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Summary:

Nearly two-thirds of web users are purchasing digital goods, subscriptions and access to premium content. The real surprise is on how few of those purchases are for e-book titles and mobile software applications given record sales of e-reader devices and the growing demand for smartphones.

money

Nearly two-thirds of Internet users are paying for some form of digital content as more information, services and media continue moving to the web. The numbers, resulting from a Pew Internet survey of Internet users, skew towards dollars spent on digital music, software and apps, with fewer consumers having spent money on newer content markets, such as e-books, and podcasts. On average, those surveyed are spending $47 per month for digital goods and access to premium web services.

The average monthly spend is affected by extremely high-end users, such as cord-cutters that have unsubscribed from traditional television and instead are solely dependent on web-based media solutions for video entertainment. The Pew research team reports that without these consumers who rely heavily on the web, most purchasers actually spend $10 per month for digital subscriptions, content and access to media behind a paywall. Here’s a rundown on some of the Pew results for spending on digital goods:

  • 33% of internet users have paid for digital music online
  • 33% have paid for software
  • 21% have paid for apps for their cell phones or tablet computers
  • 18% have paid for digital newspaper, magazine, or journal articles or reports
  • 16% have paid for videos, movies, or TV shows
  • 11% have paid for members-only premium content from a website that has other free material on it
  • 10% have paid for e-books
  • 7% have paid for podcasts
  • 5% have paid to access particular websites such as online dating sites or services
  • 2% have paid for adult content

A few thoughts jump out at me from the survey results, the main one being that only 21 percent of surveyed consumers have purchased apps for their cell phones or tablets. Initially, I figured this number would be higher, given growth of the mobile app economy. But two factors are likely at play here. Smartphone users download more free apps than paid apps, so free downloads wouldn’t count for this statistic. And second is smartphone ownership: it’s not until this time next year that we expect one in two U.S. consumers to have a smartphone. As a result, smartphone adoption here (which is high compared to other countries) is likely around 30 percent, which would preclude 70 percent from buying apps on their phone.

I’m somewhat surprised by the low number of e-book buyers, however. Digital books for most platforms can be read on a wide array of devices: smartphones, computers, tablets and of course, dedicated e-reader devices. Even though it won’t share sales numbers, Amazon recently pointed out that its newest Kindle is the best selling product on Amazon. Between that news and the cross-platform support for e-book content, I would have expected more spending on e-books from the Pew Internet survey.

Related GigaOM Pro Research (sub req’d):

  1. How far are those dollars going? Buying ten items for $10 is quite a bit different from buying one item for $10. One is arguably a convenience tax, while the other is pay for content.

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  2. [...] conducted among 750 people who were interviewed personally and questioned on their buying habits. GigaOM’s analysis of the report is,Here’s a rundown on some of the Pew results for spending on digital goods: 33% of internet users [...]

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  3. I think one of the reasons why the number of ebooks being sold isn’t higher is due to piracy or give aways. You can easily find torrents for individual books or packages of books, but you can also find publishers and authors giving away books on their websites or Scribd.

    Myself, I rarely buy ebooks. There are plenty of free ebooks out there that aren’t pirated that can provide me enough information and entertainment to keep me busy for a while. That and the large library on Gutenberg, and I’m set for life with my reading.

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  4. E-books are naturally going to be slow burners vs. music: I can download a $9 album and listen to it on my way to work or as background while I do something else (and have it in my collection forever). I can also download a $9 book but it’s going to take more than a day or two to finish it, there are only so many hours to devote to an active pastime vs. a passive one.

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