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Gambling predicted to drive interactive TV

By 2005 most people will connect to the Net through their TV says research firm -- and gambling could be the killer app
Written by Jane Wakefield, Contributor

Interactive TV is beginning to take off as research firm Jupiter MMXI finds that gambling has become the surprise killer application and predicts that by 2005 more people will access the Internet through their TV than through their PC.

A quarter of UK homes -- about seven million -- currently enjoy digital TV services, all of which come with a degree of interactive content. Uptake of interactive digital TV (IDTV) is crucial to government plans for universal Net access and for turning the analogue signal off by 2010. The government is confident that half of UK homes will have gone digital by 2002.

Gambling is the "first killer app" of IDTV according to Jupiter MMXI analyst Dan Stevenson. Bookmaker William Hill claims that seven percent of its revenue comes from the Net and Sky has done deals with several betting sites. Stevenson believes the impulsive nature of gambling has played a big part in making it so popular with interactive TV users. Email has become the other big hit of IDTV, with one million of Sky's five million subscribers using emailing via TV.

While Jupiter's prediction will come as good news to the government, it is not going to be such a rosy picture for firms hoping to make money out of interactive TV content. Jupiter believes that, despite the huge increase in uptake by 2005, PC Net sales will account for the lion's share -- 80 percent -- of online spending.

However, on the future of the Internet in general, Jupiter is more optimistic than some of the gloomier reports to come out of the tech downturn. Latest figures from the firm show 13.6 million people are now using the Internet at home in the UK. While the growth rate of new users has slowed, the amount of time people spend surfing has risen to an average of seven hours per month.

There are still plenty of money making opportunities on the Net Jupiter MMXI finds. In the UK the biggest online industry will remain travel and this market will be worth £2.7bn in 2005. Most popular site with UK users remains lastminute.com, followed by Easyjet.com and British Airways Web site. A surprise entry in the top ten is Railtrack.

Railtrack had four million hits in November last year -- the time it emerged that the rail industry was in deep crisis following a series of crashes. The Ministry of Agriculture, Fisheries and Food also experienced a huge number -- 3.3million -- of hits in March as the Foot and Mouth crisis deepened. Similarly the Met Office had 1.2 million hits during the month of floods in December last year. This illustrates the disaster factor of the Net, according to Jupiter. "UK Internet users turn to the Net in a crisis," said UK managing director Mari Kim Coleman.

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