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Consumer Spending for Online Content Totals Nearly $1.6 Billion in 2003
NEW YORK -- Consumer spending for online content in the United States grew to nearly $1.6 billion in 2003, an increase of 18.8% over 2002, according to a report release yesterday by the Online Publishers Association.Paid online content spending by quarter showed clear seasonal trends, peaking in the third quarter at $407 million and dipping slightly in the fourth quarter to $404 million, mirroring a similar trend witnessed in the same quarters of 2002. Despite this slight quarter-over-quarter decline, there is no clear indication that the growth of paid content spending is coming to an end.The top three paid content categories -- Personals/Dating, Business/Investment and Entertainment/Lifestyles -- accounted for 64% of total online content spending in 2003, up slightly from 62.6% in 2002. Online Personals/Dating remained the leading paid content category in 2003, accounting for 28.8% of all paid content spending. U.S. consumers spent $449.5 million on Personals/Dating content in 2003, up a robust 48.8 % from 2002. However, this percentage increase was eclipsed by the Personal Growth category, which grew by 104.5% from $44.3 million in 2002 to $90.7 million in 2003.Spending in the Research category totaled $108.6 million, up 1.8%, while spending on general news of $87.5 million represents a 25.1% hike. Other categories include Games ($73 million, up 1.3%); Greeting Cards ($40.6 million, up 12.3%); Sports ($38.2 million, up 26.6%); and Credit Help ($36.6 million, down 9.5%).According to the report, 16.4 million U.S. consumers paid for online content in the fourth quarter of last year, up 2.1 million over the same period in 2002. The proportion of the total U.S. Internet population that paid for content in the fourth quarter of 2003 grew to 11.1%. With monthly e-commerce penetration ranging from 22% to 30% in 2003, there is still plenty of room for growing the number of paid content consumers within the population that is currently making transactions online."Paid content revenue growth continues to be driven by the acquisition of new customers to the category," says Michael Zimbalist, president of the Online Publishers Association. "The number of Internet users who participate in e-commerce continues to be significantly larger than those who pay for content online. As a result, we believe there is still significant growth potential for this market."In addition to tracking paid content spending by category, the report also analyzed paid content pricing models. While it is no surprise that subscriptions continue to be the dominant model as opposed to single-purchase sales, it is notable that monthly subscriptions have overtaken annual subscriptions as the dominant subscription term. In 2003, monthly subscriptions accounted for 49.6% of total subscription revenue (compared to 44.1% in 2002), while annual subscriptions accounted for 41.6% (compared to 47.0% in 2002).The top 25 Web destinations by 2003 consumer content revenue are as follows:yahoo.comreal.commatch.comclassmates.comwsj.comediets.commatchmaker.comweightwatchers.comconsumerreports.org180ussearch.comkiss.comancestry.combluemountain.comcarfax.complayboy.compressplay.comespn.go.comieee.orgegreetings.commsn.comastrology.comthestreet.comBritannica.comconsumerinfo.comsmartmoney.comThe study was conducted in partnership with comScore Networks.Founded in June 2001, the Online Publishers Association is an industry trade organization whose mission is to advance the interests of high-quality online publishers before the advertising community, the press, the government and the public. Visit the Online Publishers Association: www.online-publishers.org"