Europe’s broadband revenue is expected to pick up some of the slack as DVD sales slow, with downloading and viewing movies over the Internet growing to a market worth E690 million ($875 million) by 2010, according to a study released Wednesday.
Growth in Europe’s video-on-demand market will be driven by increased broadband speed and the availability of more blockbuster Hollywood titles, said media consultancy ScreenDigest.
The firm said the meager selection meant the European VOD market in 2005 was less than $12.7 million.
“As revenues in the DVD market plateau, the Hollywood studios will view diversification of business models and legal digital distribution as an increasingly important component in not only the fight against piracy, but also the maintenance of profit margins typically enjoyed in the home entertainment market,” the report said.
A number of payment methods are being explored, including pay-per-view, monthly subscriptions and ad-subsidized models.
Europe’s VOD market to date has been the focus of three camps: the telcos and Internet service providers, including Germany’s Deutsche Telekom and Tiscali in Italy; DVD retailers such as LoveFilm and Glowria; and pure plays such as CinemaNow.
Satcasters such as Britain’s BSkyB and France’s Canal Plus are exploring the delivery of movies online as well.
The launch of Apple’s iTunes and Amazon’s Unbox services, which are not yet available in Europe, is expected to bring more options to market in the next year.