Streaming media is becoming the growth engine for the $94 billion US entertainment media industry, sharing a key role in the industry along with content download.

In streaming, rich digital media is transferred across a network without requiring any local data storage. Content downloads, by comparison, are stored locally. In both scenarios, digital rights management (DRM) is being used to control or limit the listening, viewing, and distribution of content.

Streaming technology is poised for robust growth—the streaming media industry has survived its introductory phase and evolved, and now proven business models have been identified. A sufficient number of consumers are prepared to pay for the service, and technologies have become stable enough to support growth.

The business models for streaming, IPTV, and other delivery vehicles for digital entertainment are still evolving, however. In the music industry, Apple iTunes has been very successful. Consumers have demonstrated a willingness to pay for audio content, and are comforted knowing that the content they have purchased is stored on their handheld device as well as being backed up on their home computer. Apple receives 100 percent of hardware sales and a portion of sales related to iTunes content. Competitors, such as Microsoft and Verizon, are experimenting with the online music market. Microsoft's Zune download service operates similarly to iTunes, while Verizon's service includes downloads and a subscription-based streaming service. It is apparent that the currently used download and pay-per-track model is here to stay, and will maintain the lion's share of the online music market.

Consumers are also being provided with a variety of video content through a variety of venues, including pay-per-view, subscription, and ad-supported models. Video or TV content includes extensive international, national, local, financial, sports, weather, and entertainment news coverage, and is sourced and distributed by major news outlets through a variety of web portals. This content is generally free to the consumer, although it may be posted somewhat later than live news broadcast on television.

The major networks all have begun to stream some ad supported TV shows. This would suggest that some consumers show an acceptance towards exposure to commercials in return for content they want.

Feature films are also available from producers and rental firms via both streaming and downloading. Films are generally on a pay-per-view basis. iTunes, for example, has sold video content since the introduction of the video iPod in late 2005. That content could be obtained by the same method as audio tracks. In January 2008 Apple announced that it would also rent movies from all of the major studios on its website. As a download service, Apple movie rentals could potentially be a competitor to streaming movie services offered by others. But the most prevalent movie rentals will likely be viewed on a big screen in the living room and not on a portable device.

The success of all of these rich media delivery systems indicates that consumers are....................
Market Segmentation

Content Derived Revenue
Internet CDN Streaming VOD Content
IPTV Content
Mobile Streaming Audio Content
Mobile Streaming Video Content
Internet Audio on Demand
US Internet VOD Advertising

Network Derived Revenue
Encoding
DRM
Telco IPTV Network Services
Internet CDN Network Services
Performance Measurement

Content by Service Provider Type
Mobile
Internet
Telco TV