User-Generated Content Is Top Threat to Media and Entertainment Industry

NEW YORK; April 16, 2007 –Media and entertainment executives see the growing ability and eagerness of individuals to create their own content as one of the biggest threats to their business, according to results of a survey released today by Accenture.

In its annual survey of senior executives in the media and entertainment industry, Accenture examined the growth strategies of companies across the landscape of advertising, film, music, publishing, radio, the Internet, videogames and television.

More than half (57%) of the respondents identified the rapid growth of user-generated content — which includes amateur digital videos, podcasts, mobile phone photography, wikis and social-media blogs — as one of the top three challenges they face today. In addition, more than two-thirds (70%) of respondents said they believe that social media, one of the largest segments of user-generated content, will continue to grow, compared with only 3% of respondents who said they view social media as a fad.

The new landscape offers opportunities as well as challenges, according to the study, as two-thirds (68%) of the respondents said they believe that within three years their businesses will be making money on user-generated content. 62% said they believe their companies will make money through advertising and sponsorships of social media. Other sources of profits cited were subscriptions (21%) and pay-per-play offerings (18%). However, a quarter (24%) of respondents said they do not yet know how their businesses will profit from user-generated content.

Asked to identify which type of content offers the highest growth potential for their industry over the next five years, the greatest number of respondents — 53% — cited short-form video, followed by videogames (13%), full-length film (11%) music, (11%), consumer publishing (9% and business publishing (4%).

Methodology

Accenture surveyed 110 senior executives at advertising, film, music, publishing, radio, Internet, videogame and television companies in North America (60% of the respondents) and Europe (40% of the respondents).