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People Actually Do Pay for Online Content Jim Jansen Senior Fellow Pew Internet & American Life Project. Thanks!. Great to be here!. Who is Jim Jansen?. Senior Fellow at the Pew Research Center (Pew Internet & American Life Project) - http://www.pewinternet.org

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slide1

People Actually Do Pay for Online Content

Jim JansenSenior Fellow

Pew Internet & American Life Project

thanks
Thanks!

Great to be here!

who is jim jansen
Who is Jim Jansen?

Senior Fellow at the Pew Research Center (Pew Internet & American Life Project) - http://www.pewinternet.org

Associate professor at College of Information Sciences and Technology, The Pennsylvania State University, USA

Active research and teaching efforts in the web area - http://ist.psu.edu/faculty_pages/jjansen/

Forthcoming book, Understanding Sponsored Search (Cambridge) … theory of keyword advertising

Recent Pew Internet reports focusing on ecommerce, income effect on internet usage, and online product research

what is pew internet
What is Pew Internet?

Part of the Pew Research Center

A nonpartisan “fact tank” based in Washington, DC

Provide quality and objective data to thought leaders and policy makers

Pew Internet is one project of the Center

All findings are based on nationally representative telephone surveys …

U.S. adults age 18+ or U.S. teens ages 12-17

Drawn from dual-frame (landline/cell phone) samples

English or English and Spanish

in fact
In fact, ….

65% of internet users have paid for online content

… and they spend about $10 per month for this content

before we look at the details
Before we look at the details, …

Let’s examine the context in which this occurring.

There are three on-going revolutions in technology and access …

slide10

70%

66%

  • Broadband access at home transformational, internet becomes a central hub for:
  • information
  • communication
  • entertainment

Changed the media landscape!

More importantly, content creators!

cell phone owners 85 of adults
Cell phone owners: 85% of adults

96%

Cell phone ownership has outpaced or is on par with internet access for all age groups!

90%

85%

58%

mobile internet connectors 57 of adults
Mobile internet connectors: 57% of adults

62%

  • Mobile internet connectivity with:
  • Cell phone – 39%
  • Laptop, etc. – 87%

59%

55%

Always on - access anytime and anywhere!

slide15

48% of American adults use social networking sites. The fastest growing is the 50+ age cohort!

slide16

And, folks aren’t using just one SNS!

If trends continue, the majority of American adult internet users will have profiles on multiple social network sites.

Currently, a majority of social networking site users already do (52%).

Changing social roles, workforce, culture, politics, news sources, community, commerce, participation, etc.

the impact on information
The impact on information …

Dramatic effects on people’s relationship to information, media, and electronic content

so what does this mean for purchasing online content
So, what does this mean for purchasing online content?

This is what we are seeing …

65% of internet users have purchase some type of online content!, and are spending about $10 per month

what do we mean by online content
What do we mean by online content?

Online content in this case refers to intangible digital products (i.e., software, articles, music, etc.). This is in contrast to …

tangible products (e.g., hard-copy books, clothes, computers, etc.) that one can touch or

tangible services (i.e., hotel reservations, airline ticket, rental cars, etc.) that one engages after purchase.

quick methodological note
Quick Methodological Note

Rather than just ask if a person had purchased online content or not …

We asked participants whether or not they had purchase 16 different types of digital content

breakdown by type of content
Breakdown by type of content

33% of internet users have paid for digital music online

33% have paid for software

21% have paid for apps for their cell phones or tablet computers

19% have paid for digital games

18% have paid for digital newspaper, magazine, or journal articles or reports

16% have paid for videos, movies, or TV shows

15% have paid for ringtones

12% have paid for digital photos

11% have paid for members-only premium content from a website that has other free material on it

10% have paid for e-books

7% have paid for podcasts

5% have paid for virtual items to use in video or computer games

5% have paid for “cheatsor codes” to help them in video games

5% have paid to access particular websites such as online dating sites or services

2% have paid for adult content

High of 33%

Let’s take a quick look at these percentages and content types

Low of 2%

music and software lead the way
Music and Software Lead the Way

33% of internet users have paid for digital music online

33% have paid for software

21% have paid for apps for their cell phones or tablet computers

19% have paid for digital games

18% have paid for digital newspaper, magazine, or journal articles or reports

16% have paid for videos, movies, or TV shows

15% have paid for ringtones

12% have paid for digital photos

11% have paid for members-only premium content from a website that has other free material on it

10% have paid for e-books

7% have paid for podcasts

5% have paid for tools or materials to use in video or computer games

5% have paid for “cheats or codes” to help them in video games

5% have paid to access particular websites such as online dating sites or services

2% have paid for adult content

Entertainment and commerce have always been big drivers of internet usage.

apps games and information are next
Apps, games, and information are next

33% of internet users have paid for digital music online

33% have paid for software

21% have paid for apps for their cell phones or tablet computers

19% have paid for digital games

18% have paid for digital newspaper, magazine, or journal articles or reports

16% have paid for videos, movies, or TV shows

15% have paid for ringtones

12% have paid for digital photos

11% have paid for members-only premium content from a website that has other free material on it

10% have paid for e-books

7% have paid for podcasts

5% have paid for tools or materials to use in video or computer games

5% have paid for “cheats or codes” to help them in video games

5% have paid to access particular websites such as online dating sites or services

2% have paid for adult content

The increasingly high penetration of smart phones and tablets drivers of apps usages.

multimedia premium content and books follow
Multimedia, Premium content, and books, follow

33% of internet users have paid for digital music online

33% have paid for software

21% have paid for apps for their cell phones or tablet computers

19% have paid for digital games

18% have paid for digital newspaper, magazine, or journal articles or reports

16% have paid for videos, movies, or TV shows

15% have paid for ringtones

12% have paid for digital photos

11% have paid for members-only premium content from a website that has other free material on it

10% have paid for e-books

7% have paid for podcasts

5% have paid for tools or materials to use in video or computer games

5% have paid for “cheats or codes” to help them in video games

5% have paid to access particular websites such as online dating sites or services

2% have paid for adult content

Entertainment and leisure pursuits are motivators across several types of online content.

podcasts stuff for games and access come next
Podcasts, stuff for games, and access come next

33% of internet users have paid for digital music online

33% have paid for software

21% have paid for apps for their cell phones or tablet computers

19% have paid for digital games

18% have paid for digital newspaper, magazine, or journal articles or reports

16% have paid for videos, movies, or TV shows

15% have paid for ringtones

12% have paid for digital photos

11% have paid for members-only premium content from a website that has other free material on it

10% have paid for e-books

7% have paid for podcasts

5% have paid for tools or materials to use in video or computer games

5% have paid for “cheats or codes” to help them in video games

5% have paid to access particular websites such as online dating sites or services

2% have paid for adult content

Again, entertainment and leisure pursuits.

and finally adult content
And, finally, adult content

33% of internet users have paid for digital music online

33% have paid for software

21% have paid for apps for their cell phones or tablet computers

19% have paid for digital games

18% have paid for digital newspaper, magazine, or journal articles or reports

16% have paid for videos, movies, or TV shows

15% have paid for ringtones

12% have paid for digital photos

11% have paid for members-only premium content from a website that has other free material on it

10% have paid for e-books

7% have paid for podcasts

5% have paid for tools or materials to use in video or computer games

5% have paid for “cheats or codes” to help them in video games

5% have paid to access particular websites such as online dating sites or services

2% have paid for adult content

At least some people tell the truth!

slide27
Misc.

33% of internet users have paid for digital music online

33% have paid for software

21% have paid for apps for their cell phones or tablet computers

19% have paid for digital games

18% have paid for digital newspaper, magazine, or journal articles or reports

16% have paid for videos, movies, or TV shows

15% have paid for ringtones

12% have paid for digital photos

11% have paid for members-only premium content from a website that has other free material on it

10% have paid for e-books

7% have paid for podcasts

5% have paid for tools or materials to use in video or computer games

5% have paid for “cheats or codes” to help them in video games

5% have paid to access particular websites such as online dating sites or services

2% have paid for adult content

6% have paid for some other type of content

purchasing online content
Purchasing online content

That’s where the 65% of internet users having purchased online content came from.

number of online content types purchased by internet users
Number of online content types purchased by internet users

75% have purchased multiple types of online content

much do they spend
Much do they spend?

Average monthly spend was $47

High end users skewed the average

Most purchasers spend approximately $10 per month

number of types of payment methods
Number of types of payment methods

23% of internet users pay for subscription services

16% pay for downloading an individual file

8% pay for accessing streaming content

demographic factors
Demographic factors

Similar percentages of men and women internet users pay for online content (except software, which significantly more men purchase).

demographic factors1
Demographic factors

There does not appear to be a racial divide associated with accessing online content.

demographic factors2
Demographic factors

Internet users between the ages of 30-49 are the most likely to have purchased most kinds of content.

demographic factors3
Demographic factors

Those with college degrees or some college generally are more likely to purchase online content.

demographic factors4
Demographic factors

There is a correlation between income levels and paying for online content, with those in higher-income bracket households more likely to pay for online content.

take aways
Take Aways

Technology and access is changing (has changed) the value, dissemination, and relationship attributes of information

Percentage of internet consumers similar for products, services, and digital content (all about 65%)

Also about the sameas the households with broadband access (66%)

related thoughts
Related Thoughts

Didn’t look at B2B purchases (e.g., search engines purchasing AP newsfeeds and Twitter feeds, etc.)

Power law distribution (i.e., Netflix for movies, iTunes for music, etc.)

Line between bits and atoms blurry (i.e., can get content both digitally and hard copy)

related thoughts1
Related Thoughts

Also, attitude shifts of purchasing online … perhaps based on context, use, and age

slide40

Sign that I am officially getting old. I had the option today to pay for or pirate software – I decided to pay.

follow on discussion
Follow-on Discussion

Happy to chat (either today or contact me)

Email jjansen@acm.org

LinkedIn http://www.linkedin.com/in/jjansen

Twitter jimjansen

Complete research in:Jansen, B.J. (2010) 65% of internet users have paid for online content. Pew Internet Report. http://www.pewinternet.org/Reports/2010/Paying-for-Content.aspx

slide42
Use of the internet in higher-income households

http://www.pewinternet.org/Reports/2010/Better-off-households.aspx

Online Product Research

http://www.pewinternet.org/Reports/2010/Online-Product-Research.aspx

Generations and their gadgets

http://www.pewinternet.org/Reports/2011/Generations-and-gadgets.aspx

Wikipedia, past and present

http://www.pewinternet.org/Reports/2011/Wikipedia.aspx

Generations 2010

http://www.pewinternet.org/Reports/2010/Generations-2010.aspx

Related Reports Available at Pew Internet

Pew Research uses a freeimum model. All reports, surveys, and data are available and free. Material from 2000 to the present!

slide43

Thanks!

(welcome questions!)

People Actually Do Pay for Online Content

Jim JansenSenior Fellow

Pew Internet & American Life Project