E-Commerce and Digital Entertainment Go Global

New York, NY -- The latest findings from a study of online behaviors in 12 countries show that online banking and media downloading are set to proliferate globally, according to interviews conducted with 6,544 adults, including 3,304 active Internet users, by Ipsos-Insight, a leading global market research firm.

Among the key findings of The Face of The Web study:

• Seven in ten Internet users have purchased products or services over the Internet in the markets surveyed
• Half of Internet users have banked online
• Two out of three Internet users globally have sent digital pictures or videos over the Web
• 183Two out of five households own a standalone digital camera and one in three households with a mobile phone has a digital camera on at least one mobile phone
• One in 10 Internet Users around the world has already downloaded a feature length movie
• And, over half of music downloaders have paid for a music download, with 27% having done so in the past 30 days

Banking May Supersede Purchasing

The study shows that online commerce activity grew to 71% in 2004 from 64% the previous year, driven by Leading Edge and other markets, such as France and Urban China, demonstrating a continued and widened global acceptance of the online, retail marketplace.

Similar to online purchasing, online banking continues to gain momentum in Leading and Advancing nations, with the exception of Urban China, experiencing a 30% year-over-year growth and resulting in at least one in four adults having banked online in these markets.

"While online banking is relatively less popular than online commerce at this point in time, as financial institutions continue to improve services through this medium, online banking may very well surpass online commerce activity globally," commented Brian Cruikshank, Senior V.P. of Ipsos-Insight and co-author of the study.

Unlike online retailing, Internet banking requires fewer infrastructural resources, thereby permitting relatively greater implementation and subsequent adoption than online retailing in Nascent and Emergent markets. Furthermore, next generation mobile phones and networks already allow data transactions through a mobile device in many parts of the world. As a potentially larger mobile phone user base embraces this application, the trend will no doubt lead to greater expansion in online banking, both in developed and lesser-developed markets, Cruikshank said.

Digital Media Exchange and Online Music Leading Online Entertainment

Today, a pixel is worth more than a thousand words. Digital media exchange continues to be a dominant form of digital communication and entertainment, with two out of three Internet users globally reporting to have sent digital pictures or videos over the Web. Continued growth in digital device ownership, both wired and wireless, will not only lead to greater involvement in this activity, but may indeed be a propelling force for many to go online.

What could be driving this change? Digital cameras, both standalone and on mobile phones. Two out of five households globally own a standalone digital still camera, representing a 42% increase over 2003. Moreover, one in three mobile phones owned within a household have a digital camera, a trend that will no doubt spur continued growth in digital media exchange as next generation mobile technologies become commonplace.

Among broader online entertainment activities, music-related behaviors still thrive, with listening to online music predominating. Nearly three out of every five Internet users report having listened to music online, representing the most dominant form of online entertainment with a 25% user growth compared to 2003. In fact, online music listening is one of the most prominent online activities for Internet users in Canada, Japan, South Korea, and Urban environments of China, India and Russia. After substantial decreases in 2003, U.S. music downloading made a comeback in 2004, returning to downloader population levels tracked in 2002. Overall, two thirds of the estimated 154 million music downloaders reside in the U.S., Japan and South Korea, with Japan showing the largest year over year prevalence growth.

On average, at least one in three Internet Users has downloaded a music file. Of those, over half have paid for at least one music download in the past, with 27% of music downloaders having paid for music downloading in the past 30 days. Of the developed economies, Canada has the largest non- paying music downloader population (64%), while France has the smallest (31%).

Indeed, fee-based music downloading may provide a glimpse into future trends in broader digital media acquisition over the Internet, providing the impetus for many studios, publishers, and other content providers to begin moving their business models to a new digital distribution paradigm. While it may be a while before downloading movies become as seamless and widespread as watching TV or listening to music, one in 10 Internet Users around the world has already downloaded a feature length movie. As with all download activities, the numbers are even higher in Urban China and traditionally the broadband Mecca - South Korea where two out of every five Internet users have downloaded a movie.

Methodology

The Face of the Web 2004 study was conducted in late 2004 among a random sample of 6,544 adults in urban Brazil, Canada, urban China, France, Germany, urban India, Japan, urban Mexico, urban Russia, South Korea, the U.K., and the U.S. The Face of the Web 2004 study also examined:

• Household technologies owned and used, as they relate to wireless communication, Internet access and future home networking possibilities
• Both wired and wireless activities performed
• Types of connectivity used (i.e., broadband cable, DSL, dial-up modem, wireless etc.) and trends in emerging technologies such as Wi-Fi and other data driven wireless applications
• Extent of wireless Internet connectivity, types of wireless devices in use, and intentions for adoption
• Global Internet awareness, trial and usage within twelve key markets around the world
• Barriers to Internet usage, future plans to go online and implications of Internet growth

Ipsos-Insight

Ipsos-Insight, the flagship marketing research division of Ipsos in the U.S., has industry specialists serving companies in the following categories: consumer products; technology and communications; health and pharmaceutical; financial services; cable, media and entertainment; agrifood; energy and utilities; and lottery and gaming.

Ipsos-Insight provides custom and tracking research services to domestic clients, as well as U.S.-based multinationals. It offers concept and product testing, package testing, attitude and usage studies, omnibuses, tracking systems, brand equity, price optimization and segmentation, marketing models, advanced analytics, and global research. Ipsos-Insight is an Ipsos company, a leading global survey-based market research group.

To learn more, please visit www.ipsos-insight.com.

Ipsos

Ipsos is a leading global survey-based market research group, which conducts research in more than 100 countries. Ipsos offers a full suite of research services--guided by industry experts and bolstered by advanced analytics and methodologies--in advertising, customer loyalty, marketing, media, and public affairs research, as well as forecasting and modeling. Member companies in Europe, North America, Latin America, the Middle East and Asia-Pacific also offer a full line of custom, syndicated, omnibus, panel, and online research products and services. Visit www.ipsos.com to learn more about Ipsos offerings and capabilities.