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September 7, 2004

Back Again: Micropayments [7:35 am]

More analysts promising that it’s “just around the corner” as well as arguing that, well, $0.99 is a kind of micropayment: Digital content spurs micropayments resurgence

Micropayments are typified by the 99 cents that iTunes charges to download a song or the $2.99 users might see on their Cingular Wireless phone bills after buying custom ringtones.

According to recent research published by TowerGroup, the total market for Internet and wireless micropayments, led by demand for digital content, will increase by 23 percent annually over the next five years to reach $11.5 billion by 2009. TowerGroup, based in Needham, Mass., charted the micropayments market at just over $2 billion in 2003.

[...] Future growth of the digital content market seems almost a certainty, based on the projected expansion of segments including music services, Internet publishing, and applications for mobile devices, such as custom ring tones or games. Cambridge, Mass., analyst firm Forrester Research has predicted that music downloads alone will become a $1.4 billion business by 2006, accounting for nearly 10 percent of annual music sales in the United States.

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