• by Masha Geller , December 13, 2002

According to eMarketer, the web that was once the place to get limitless free content is evolving into a paid access medium, thanks to the downturn in online advertising.

According to eMarketer’s latest report, 15.7 million US consumers will purchase online content (excluding porn and gambling) by the end of 2002, and that the number will rise to 21 million in 2003. This constitutes 10% of all US Internet users this year, which will rise to 13% by next year. That adds up to individuals shelling out $3.8 billion worldwide for online content in 2002 and organizations spending about $44 billion. eMarketer estimates adult content will total $400 million and online gambling will total $2.5 billion at the end of 2002.

Why are people more inclined to pay for online content? According to a recent Content Intelligence study, 42% of people paid for online content because it was the only place they could get that information. The second most important reason was that that they were simply curious.

eMarketer assures that this “does not signal the end of all free content online, or the end of the banner and pop-up ads that supports content sites. It is a sign of the emergence of more realistic and robust business models that combine advertising, subscriptions and pay-per-view fees.”

Ben Macklin, Senior Analyst at eMarketer, says the evolution to paid content is a simple case of “economic Darwinism. Weak companies have died out and the remaining companies are adapting."

"The question of whether consumers are more willing to pay for online content now, than in the past, has become largely irrelevant," he says. "Let's face it; people would rather not pay. The more appropriate question is whether businesses are any longer willing to offer online content and services for free. And the answer increasingly seems to be no. That reality will transform the Internet."