Singapore - The Asia-Pacific online content services market -- including music, video and games -- saw revenues grow 25.6% in 2007 and are expected to rise 21% to $4.67 billion by year's end, and to $9.2 billion by 2013, according to a report from Frost & Sullivan.

The growth is being fueled largely by online gaming, which accounted for as much as 81.3% of revenues in 2007, compared with music (10.8%) and video (7.9%).

Online gaming is expected to see a compound annual growth rate of 14% over the next five years, to $6.9 billion -- when it will account for 75% of the market share.

The report cites free online content -- both legal and illegitimate -- as factors posing major obstacles for wider uptake of paid online content; for instance, China's legal music downloads account for only approximately 1% of the region's online music market.

"Game providers on the other hand have adopted the FTP (free-to-play) revenue model where gamers are not charged an upfront cost to play games online, and instead aim to profit through in-game advertising and virtual sale of in-game items like weapons, ammunition and such," said Frost & Sullivan analyst Kamlesh Kalwar.

"In nascent markets, there has been a consistent attempt to increase sampling by giving the base version for free and charging for the advanced versions once the subscriber is hooked."

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