(this post in collabaration with NPR)
Over the past few days a couple of us have been trying to figure out the economy of the internet. Or more specifically: Of 'internet gambling' and 'internet pornography', which industry is larger?
Firstly what does the 'largeness' of an industry mean? Its turnover? profits? number of users? It'll likely be quite hard to get reliable numbers of pornography users (although the number of online gamblers has been estimated at 12 million as of 2003) so I'll restrict this analysis to talking about the gross revenues for each business.
Gambling: In 2001 the gaming board for Great Britain estimated that "Total online gambling – £21 billion". This figure is split into:
Online Horseracing - £2 billion
Online Sports betting - £9 billion
Online casinos - £5 billion
Online Lotteries - £5 billion
These figures represent the turnover (that is: total bets placed) and gross profits (i.e. bets placed - winnings) are much smaller, of order 2.2 to 3 billion pounds circa 2000. In the period 2000-2006 onling gambling experienced an absolutely explosive growth and I would not be surprised if the figures today were a factor of 5 or more higher than these (backed up by the graph on this page, showing a revenue growth from 2bl in 2001 to just shy of 15bl in 2007). I'll therefore estimate that total Online Gambling Revenue is around £10+ billion.
This seems pretty much in line with future predictions from e.g. $48bl (£24bl) by 2010 (Merrill Lynch)
Pornography: I have really struggled to find figures on the size of this business, the BBC recently reported it to be 'worth £29bn' and I don't know whether this is revenue, net worth, or turnover so need to discount this number.
NBC wrote recently that the industry is a "$2.5bn business". Other sites put the revenue at $1bn in 1998, a 2001 report from UK group Analysys, forecast that broadband erotica would be worth US$3 billion by 2003. In 1998 Datamonitor forecast that by 2000 adult content would generate US$1.7 billion revenue in 2000. Finally it has been estimated that the global "online adult market" was worth around US$2 billion a year. (last three numbers from here)
These numbers are all a bit out of date and I wouldn't be surprised if with the advent of widespread broadband coverage this market grew in the same way as the gambling market
Summary: From a completely untrained and haphazard look at the numbers I think that around the start of the millennium the online gambling and online pornography businesses were both valued at around $2bn, although these is a lot of scatter in the numbers from ifferent sources. Today the size of the online gambling business is slightly greater than that of the online pornography business.
Obviously I'm no accountant, so this conclusion should be taken with a shovel full of salt. Additionally I have not factored in how the US government's recent ban on online gambling will affect the gambling numbers
Miscellaneous Mindblowing Facts:
Over the past few days a couple of us have been trying to figure out the economy of the internet. Or more specifically: Of 'internet gambling' and 'internet pornography', which industry is larger?
Firstly what does the 'largeness' of an industry mean? Its turnover? profits? number of users? It'll likely be quite hard to get reliable numbers of pornography users (although the number of online gamblers has been estimated at 12 million as of 2003) so I'll restrict this analysis to talking about the gross revenues for each business.
Gambling: In 2001 the gaming board for Great Britain estimated that "Total online gambling – £21 billion". This figure is split into:
Online Horseracing - £2 billion
Online Sports betting - £9 billion
Online casinos - £5 billion
Online Lotteries - £5 billion
These figures represent the turnover (that is: total bets placed) and gross profits (i.e. bets placed - winnings) are much smaller, of order 2.2 to 3 billion pounds circa 2000. In the period 2000-2006 onling gambling experienced an absolutely explosive growth and I would not be surprised if the figures today were a factor of 5 or more higher than these (backed up by the graph on this page, showing a revenue growth from 2bl in 2001 to just shy of 15bl in 2007). I'll therefore estimate that total Online Gambling Revenue is around £10+ billion.
This seems pretty much in line with future predictions from e.g. $48bl (£24bl) by 2010 (Merrill Lynch)
Pornography: I have really struggled to find figures on the size of this business, the BBC recently reported it to be 'worth £29bn' and I don't know whether this is revenue, net worth, or turnover so need to discount this number.
NBC wrote recently that the industry is a "$2.5bn business". Other sites put the revenue at $1bn in 1998, a 2001 report from UK group Analysys, forecast that broadband erotica would be worth US$3 billion by 2003. In 1998 Datamonitor forecast that by 2000 adult content would generate US$1.7 billion revenue in 2000. Finally it has been estimated that the global "online adult market" was worth around US$2 billion a year. (last three numbers from here)
These numbers are all a bit out of date and I wouldn't be surprised if with the advent of widespread broadband coverage this market grew in the same way as the gambling market
Summary: From a completely untrained and haphazard look at the numbers I think that around the start of the millennium the online gambling and online pornography businesses were both valued at around $2bn, although these is a lot of scatter in the numbers from ifferent sources. Today the size of the online gambling business is slightly greater than that of the online pornography business.
Obviously I'm no accountant, so this conclusion should be taken with a shovel full of salt. Additionally I have not factored in how the US government's recent ban on online gambling will affect the gambling numbers
Miscellaneous Mindblowing Facts:
- Total global gambling turnover (offline and online) - £638 billion.
- About 200 pornographic films are shot in the US every week
- Adult entertainment model Jasmine Mai told the BBC: "The adult industry
is bigger than every professional sport combined. It's part of life - it's
mainstream now. - Annual PPARC budget: 450-500mil
Labels: gambling, online, pornography
