Annual consumer spending on Internet downloads of movies and TV shows will top $4 billion in 2011, up from just $111 million last year, according to a study released Wednesday by Adams Media Research.
"The Internet is going to revolutionize the distribution of video," says Adams Media Research President Tom Adams.
The growth will be fueled by the introduction of hardware devices such as Apple TV, a $299 box that converts videos downloaded from the Internet into signals that can be played on high-definition television sets.
Apple is selling the boxes on its Web site and says they will be shipped later this month.
Adams Media Research is betting that video downloads will ramp up gradually as Apple TV and similar devices win acceptance among consumers.
The market researcher forecasts that sales of video downloads will total $472 million in 2007, $1.2 billion in 2008, $2 billion in 2009 and $3.1 billion in 2010, and then will hit $4.1 billion in 2011.
It also predicts that advertiser spending on Internet video streams to PCs and TVs will approach $1.7 billion by 2011.