Trade Body says ISPs could make up to £200m from downloads

Internet service providers could make up to£200 million a year by 2013 on legal music downloads, according to a new report by the BPI

The British music industry trade body estimates that the UK's major ISPs, such as BT, Virgin Media, and BSkyB, could generate between £100 million and £200 million a year between them in three years by bundling legal download services with broadband packages. BSkyB has already launched a music download service, called Sky Songs, while Virgin Media is planning a similar service, which is yet to go live.

Collated by research firm Ovum, the report based its projections on the basis of low (6,000 consumer sign-ups a month), medium (12,000) and high (24,000) levels of uptake of new legal download services up to 2013. ISPs would need to sign up customers at a medium rate to make £100 million collectively a year in three years, while companies could garner £203 million a year from high level subscriptions.

The BPI chief executive, Geoff Taylor, said: "It is increasingly clear that it isn't smart to be a 'dumb [broadband] pipe’. This report shows that the revenue potential of digital music services alone makes sound economic sense for ISPs."

By offering such value-added services as legal downloads, the report says that the big ISPs could save up to £20 million a year by reducing the number of customers cancelling their subscriptions.

The BPI has been pushing for the ISP sector to police illegal downloading and to offer legal alternatives with a string of press releases and reports that aim to crank up the pressure on ISPs.

Source: Guardian

Published on: 09/03/2010 10:23:00