Backchannelmedia

Business Wire, July 15, 2002

U.S. Market For Interactive TV Advertising To Reach $2 Billion In Revenues Through 2005

In today's economic climate, advertisers are challenging their agencies to be more effective with their media buys for reaching target audience(s). Subsequently, television advertising is going through a paradigm shift where agencies and media buyers are focused on creating more compelling ad campaigns over interactive TV programs and applications. In a Report released today, "Interactive TV Advertising: 2001-2005 U.S. Outlook & Trends" TRACE strategies reveals that interactive TV advertising is expected to account for 6.3% of total U.S. TV advertising revenues by the end of 2005. Specifically, total U.S. revenues from interactive TV advertising (comprised of Interactive Program Guides, Video-On-Demand, Walled Gardens and Enhanced/Interactive Video) will experience average year-over-year growth of 114%, reaching $2.1 billion by the end of 2005.

Growth catalysts include an increase in spending for ads delivered over emerging video-on-demand, walled garden and virtual channel platforms.

In fact, average year-over-year revenue growth for interactive TV advertising will be strongest for walled garden and virtual channel platforms, with revenue growth averaging 238% through 2005. The Report also shows that despite possessing the weakest year-over-year revenue growth, Interactive Program Guides will still account for the largest share of total interactive TV revenue by the end of 2005, with over $794 million in revenue. Furthermore, U.S. household penetration of interactive TV advertising will grow an average of 70% through 2005, reaching an estimated 122 million homes.

About the Report

Published in July 2002, "Interactive TV: 2001-2005 U.S. Market Outlook & Trends" provides companies with an in-depth analysis and examination into the growth prospects and market trends of the U.S. interactive TV advertising market, which is comprised of the following categories:

1. 1. Interactive Program Guide (IPG) Advertising;
2. 2. Video-On-Demand (VOD) Advertising;
3. 3. Walled Garden/Virtual Channel Advertising; and
4. 4. Enhanced/Interactive Video Advertising

The Report also provides 2001-2005 estimated revenue market share and growth rates for IPG-based, VOD-based, walled garden/virtual channel-based and enhanced/interactive video advertising. The Report also highlights current U.S. market milestones, ongoing technology developments and ITV advertising campaigns. Furthermore, the Report analyzes the rapidly evolving ITV advertising landscape and provides Power Rankings and profiles for the following 21 companies that are helping to drive the next stage of ITV advertising in the U.S.

-- ACTV (NASDAQ:IATV)

-- Adexact

-- BackChannel Media

-- Concurrent Computer

-- Digeo

-- Everstream

-- Gemstar-TV Guide International (NASDAQ:GMST)

-- GoldPocket Interactive

-- Liberate Technologies

-- Mag Rack

-- Metabyte Networks

-- Navic Networks

-- nCUBE

-- OpenTV

-- Predictive Networks

-- Princeton Video Image

-- SeaChange International (NASDAQ:SEAC)

-- TiVo (NASDAQ:TIVO)

-- Visible World

-- Wink Communications (NASDAQ:WINK)

-- WorldGate Communications

The Report contains 61 pages and 24 charts, and is available for $595. An additional 16 PowerPoint charts can also be ordered. For more information about the report, please visit: http://www.tracestrategies.com/market/published.html

About TRACE strategies, Inc.

TRACE strategies Inc., is a leading high-tech market research and strategic consulting firm, focused on convergent product trends across the consumer electronics industry. Our research is divided into three practice areas - 1) Interactive TV Appliances & Services, 2) Embedded Systems & Smart Appliances, and 3) Wireless Multimedia & Infotainment Appliances. For more information, please visit www.tracestrategies.com.