• by December 20, 2002

The Online Publishers Association on Friday announced the results of its Q2/Q3 U.S. Market Spending Report for paid online content and the growth is remarkable.

The study, conducted by comScore Networks, determined that the total market for paid online content in the U.S. grew to $361.4 million for the third quarter, a 14% gain over the previous quarter and a 105.3% gain over Q3 2001. Through the first three quarters of 2002, U.S. consumer spending for paid online content totaled $975 million, versus only $670 million for the full-year 2001.

The report also found that the number of U.S. consumers paying for online content in Q3 2002 nearly doubled to 14.8 million from 7.9 million in Q3 2001, with more than 1 in 10 online users now paying for some form of content online.

The Personals/Dating category surpassed Business/Investing and Entertainment/Lifestyles content to become the leading paid content category in Q3 2002 with $87 million in revenues, a 387% gain over the same quarter last year. The OPA/comScore study found that spending in nearly all content categories grew more than 100% in the third quarter of 2002 versus the same quarter last year. The top three categories - Personals/Dating, Business/Investment and Entertainment/Lifestyles - account for 62% of all paid content revenue year-to-date in 2002.

"Remarkably, during a period of general economic stagnation, the market for online paid content in the U.S. maintained its stunning year-over-year growth rate," said Michael Zimbalist, executive director of the Online Publishers Association. "As consumer acceptance continues to rise, premium content will play an increasingly important role in the revenue mix for online publishers."

In Q3 2002, nearly every pricing model experienced triple-digit growth over Q3 2001. Single-purchase transactions rose to more than $56 million, a gain of 132% over Q3 2001. General News showed phenomenal growth in single purchases, going from $604,000 in all of 2001 to almost $9 million in just the first three quarters of 2002. The single-purchase growth in that category came primarily in the $5 -$49.99 price range.

Micropayment transactions (individual purchases under five dollars) also experienced dramatic growth, up from $279,000 in Q3 2001 to $3.1 million in Q3 2002, a more than tenfold year-over-year growth rate, although such transactions still account for only a small fraction of all paid content spending.

The information contained in the report is based not on self-reported consumer surveys, but on actual observed purchases of content. Using its representative panel of more than 1 million U.S. online consumers, comScore Networks calculated the results by passively and electronically monitoring the actual purchase and usage transactions that took place during the analysis period.