Can User-Generated Content Generate Revenue?

eMarketer:

The user-generated content movement is no longer a fad.

In the US, eMarketer projects that the number of user-generated content creators will rise from 77 million in 2007 to 108 million in 2012.

he content is being read, seen and heard, too.

The number of consumers of user-generated content will increase from 94 million in 2007 to 130 million in 2012.

“US Internet users are creating and consuming user-generated content in record numbers,” says Paul Verna, eMarketer Senior Analyst and author of the new report, User-Generated Content: In Pursuit of Ad Dollars, “across an ever-expanding range of online content that includes video, audio, personal profiles, avatars, photo sharing, Wiki entries and product reviews.”

So the content is there, but is it accompanied by a viable revenue model?

”Advertising revenues against user-generated content are modest,” says Mr. Verna,” and they are expected to stay that way for some time.”

Or, as Andrew Keen, author of Cult of the Amateur, said in a Newsweek interview, “Nobody wants to advertise next to crap.”

“Given the size and level of engagement of the audience, advertising revenues around user-generated content will not approach the level one might expect,” says Mr. Verna.

Nevertheless, eMarketer anticipates US user-generated content advertising revenue will reach $824 million in 2012, up from $162 million in 2007.

Photo by kveselyte.

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