Archive notice: This article was originally published on October 22, 2007. Links and embedded videos are preserved as part of the historical record.
The digital entertainment market is in upheaval. Internet use in particular is exerting a major influence on the way the TV, games, music and PC industries function. According to pressetext, the common future of the different segments depends above all on the subject of digital connections. The British market researchers at Canalys are now taking a look into the crystal ball in their study “The evolving EMEA digital entertainment market”.
The experts give mobile-phone TV, for example, hardly any chance of an imminent breakthrough. Many consumers would be paying for pay-TV models anyway. It was therefore difficult to imagine that a broad mass of users would dig so deeply into their pockets for the limited period in which they would watch content on the mobile phone. However, price sensitivity varies considerably from country to country, emphasizes study author Adrian Drozd. “While 35 percent of consumers in the United Kingdom think that 15 euros per month would be a good price for mobile-phone TV, only 15 percent of Germans and French agree.”
In the music sector, dispensing with DRM is expected to trigger a new boom in legal downloads and put the previous industry leader iTunes under pressure. However, the industry is still suffering from piracy, which has led to a considerable slump in sales figures for physical media. “With regard to devices, Apple’s iPod is also increasingly coming under pressure from high-end mobile phones,” Drozd says. However, Apple had responded to the development with the launch of its iPhone. Despite some hurdles, the Apple phone will find its way into consumers’ hearts, especially in Europe, according to Canalys’s forecasts.
The Canalys experts also predict a fierce battle for the throne in the console market. Now that Microsoft, Sony and Nintendo have launched their new-generation consoles in Europe, the battle for customers is reaching a new level. Microsoft currently had its nose in front with the Xbox 360, followed by Nintendo’s Wii. Sony was currently still lagging behind because of high prices and a lack of hit games. The PS3 will be at a disadvantage to the Xbox 360 in the Christmas business, Goldmedia analyst Bernd Hartmann also predicts in a conversation with pressetext.
“Corrections to price and features are becoming almost commonplace with this console generation,” Canalys analyst Drozd criticizes. Console manufacturers should take care not to scare off customers with their tactical steps – especially when it comes to expanding the portfolio towards online services and positioning the console as the center of the digital home. Canalys expects the console war to peak in 2009.
