Long tail trend poses a challenge for conventional media owners

Yet again, another interesting article from the FT about the latest Nielsen Netratings survey of Internet brands. Interestingly enough, the web 2.0 brands are growing very fast and the media industry is getting nervous.

Consumer content on the internet increases.
By CARLOS GRANDE
September, 15th 2006 – (c) 2006 The Financial Times Limited.

The sharp rise in consumer-created content on the internet was underlined yesterday by figures showing five of the 10 fastest-growing online brands were websites for people publishing and sharing their own material.
When Nielsen/Net Ratings, the data company, did the same survey for 2005, only one of the top 10 fell into the consumer-created category.
Analysts believe the changing market reflects the greater availability of broadband internet access, which makes it easier for consumers to distribute home-made material such as video or photographs via the web.
They said the trend posed a challenge for conventional media owners investing in and charging for content.
However, sceptics argued that many consumer-created web brands have yet to show they can recover their running costs from revenue streams such as advertising.

The latest figures, which cover the period from January to July, are notable for the growth of YouTube.com, the website which encourages people to upload and share video clips for free.
Nielsen/Net Ratings calculated that YouTube’s unique UK audience – the number of individuals looking at the site at some point over the month – was 3.58m in July, up 478 per cent from January. YouTube is a privately-held US company that has not even launched a dedicated UK website.
The growth outstripped that of Flickr, a website owned by Yahoo, the search engine, which provides online storage of photographs. Flickr increased its audience by 131 per cent to just over 1m.
YouTube’s unique audience for July was also larger than the 3.5m recorded by MySpace, the networking website owned by Rupert Murdoch’s News Corporation, which has launched a dedicated UK variant.

Alex Burmaster, European internet analyst at Nielsen/Net Ratings, said: “Last year indicated the potential for sites utilising the internet as a method for users to communicate and share information and the first half of 2006 has confirmed this. The audience to video-sharing phenomenon YouTube is testament to this, having grown by a factor of almost five during the year. More than one in eight Britons online now visit the site.”

The audience figures are important because both YouTube and MySpace aim to remain predominantly free to the public and charge advertisers to reach their users, who are mostly young.
While advertisers have been drawn to the websites by their growth and the lengthy average times that visitors spend on them, they are aware that the sites often contain raucous and copyright-infringing material, which could prove damaging to brands advertising on them.

Other content-sharing websites in the top 10 list included Photobucket, for image and video-sharing, and Bebo, a social networking website and rival to MySpace.
American Express was the fourth fastest-growing web brand.

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