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Jupiter Research: Paid Content Market to Soar

Consumer spending on paid content on the Internet will jump to $2 billion in 2003, up 30 percent from a year, according to a survey published by Jupiter Research.

However, despite the growth of the paid content market, the research firm found that online advertising remained the "best opportunity" for most online media businesses.

Jupiter Research, which is owned by the same parent company as internetnews.com, is projecting paid content will grow at an annual rate of more than 20 percent until 2007, when it will reach $5.4 billion.

The report, released at the company's Online Media Conference Monday, found that syndication revenues for consumer content will grow from a very small base in 2003 to $1.4 billion in 2007. At the same time, Jupiter Research said online advertising spending will reach nearly $14.0 billion in 2007, up from $6.2 billion in 2003.

But, even as consumers are opening their wallets to pay for online content, Jupiter's researchers found that, for the next 18 to 24 months, online media house will generate 60 percent to 70 percent of revenues from advertising.

"The $2.0 billion forecasted for paid content spending is fragmented across over a dozen categories ranging from news to sports to health to adult content, making it difficult for any one company to collect a significant share of that spending," Jupiter noted