Survey Indicates Internet Not Used for Entertainment.

The results of the 2000 PricewaterhouseCoopers Consumer Technology Survey (www.pwcglobal.com), confirm what the Internet's struggling and closed content sites have previously indicated -- entertainment still lags behind e-mail and research, when it comes to why users log on at home. Although entertainment was mentioned by 51 percent of Americans when asked for reasons they access the Internet, the number dropped to 6 percent when asked for their primary reason for going online. Consumers in the survey's sampling also indicated that they would not be receptive to paying for music or video online.

The study encompassed a rather small sample, with a total of 2500 consumers in the U.S., U.K., France, Germany and Australia. No demographic information was available; however, all those surveyed were adults.

"In order to make it [the Internet] a viable alternative source for entertainment, broadband access must increase in hand with more compelling content," said Kevin Carton, global leader of Pricewaterhouse Coopers Entertainment & Media Practice. The survey also confirmed the common conception that broadband is still lagging behind analog modems. The survey did note, however, that 48 percent of Germans have a broadband connection, largely due to the high concentration of ISDN - which accounts for 38 percent of the broadband connections in Germany.

The survey indicates that its not just a matter of getting the word out, as users who are aware of broadband options are still not using them for their primary access. Germany was again an exception, where half of the users aware of ISDN are actually using it. In comparison-- only 14 percent in the U.S., 3 percent in Australia, 12 percent in the U.K. and 20 percent in France have adapted broadband. The survey cites high cost as a deterrent, as well as satisfaction with current Internet connections.

The results of this survey do not indicate a willingness by consumers to adopt a subscription-based model or pay, in general, for music or video on the Internet. In all countries surveyed, about one-quarter of users download music from the Internet, showing very little change from last years results. Of those who do download or stream music, many indicated they would not continue if they had to pay for each recording, - 75 percent in the U.S., 70 percent in Australia, and 63 percent in Europe. The majority did say they had learned about new artists through this method, and that doing so led them to purchase a CD - 77 percent of Americans, 78 percent of Australians, and 54 percent of Europeans.

Video is still lagging behind with roughly 12 percent of users downloading or streaming videos, and very few finding the experience as satisfying as TV. As with music, most indicated they would no longer download video if they had to pay per download.

"The recent failures of online entertainment companies such as DEN, Pop.com, Pseudo and Scour demonstrate that the business models for online entertainment are not fully developed," said Carton. "While we're beginning to see some successful formats, there is still a long way to go before there is synchronicity among the right content, at the right bandwidth over the right interface. Only then will Internet entertainment achieve its potential and create meaningful new revenue streams for Hollywood."