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June 15, 2004

ACCUSTREAM RESEARCH: STREAMING ADVERTISING AND SUBSCRIPTION REVENUE FORECAST AT $625 MIL. IN ’04

Monterey, CA Subscription and stream-based advertising revenue is forecast at $625 million in 2004, and expected to reach $864 million in 2005, according to a new report issued by market analysis firm AccuStream Research.

The report, Streaming Advertising and Subscription: A Complete Market Analysis 2003-2005 concludes that stream-based advertising (audio and video) will make up 37% of total streaming media revenue in ‘04, up from 28% in 2003.

With broadband penetration increasing, and those users consuming more of the Internet—including audio and video—advertising have been following those audiences online and creating more demand for streaming media inventory.

On the supply side, sites are incorporating a variety of traditional and newly launched ad unit formats and approaches, including pre-roll ads, ads running inside subscription streams, Java video ads that are not tied directly to a requested stream and between-the-page ad units. 

The streaming ad market picked up momentum during the second half of 2003 and advertiser demand carried over into 2004. Upfront sales indicators suggest an even more robust market in the fall of ’04 and into 2005.

“What’s happened over the past two years, is that agencies, rep firms, solutions providers and content sites have recognized that as streaming media has grown in reach, it can in fact be supported by advertising. And, broadcast media budgets are the target everyone is shooting for,” commented Paul A. Palumbo, research director at AccuStream.

“Advertisers understand the impact of visual messaging, particularly to targeted audiences. And, in 2004 while more high value content moved out from behind subscription services, increasing inventory, CPMs have held firm.”

“On the Internet radio side, rep firms now pitch inventory using the same reach metrics as on-air radio. With everyone speaking the same language, there is a better chance to attract national advertisers.”

As for subscription, streaming and download music services are forecast to make up 39% of the $384 million dollar market in ’04, followed by platform services such as SuperPass, and professional sports league programming at 24%.

AccuStream Research publishes the monthly reports iBroadcast Stream Report, iBroadcast Avails Report, iBroadcast Wireless and Mobile Content Report, plus other annual and semi-annual streaming media reports with extensive data and analysis.

Contact: Paul A. Palumbo, ppalumbo@accustreamresearch.com
(831) 393-1953

Accustream Research
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