I'll Take "Tech" for a Trillion

Tech. For me, that word conjures up visions of PCs, graphical user interfaces, databases, servers, and a hearty bowl of acronym soup. Rightly so, of course -- this is, after all, the stuff that temporarily drove dozens of previously unknown stocks into the stratosphere during the dot-bomb era.

Today, however, I find myself forced to rethink things a bit. That's because of a report published yesterday by PricewaterhouseCoopers (PwC) that says spending on streaming media from users of wireless and broadband will rise from $11.4 billion during 2004 to approximately $73 billion by 2009. That's a compound annual growth rate of nearly 45% for the next five years. PricewaterhouseCoopers also predicts the overall market for digital entertainment will grow 7.3% annually, to $1.8 trillion in 2009, up from $1.3 trillion last year.

Frankly, I should've seen this long ago. That's because I've studied Akamai's (Nasdaq: AKAM  ) business intently, and I know this Motley Fool Rule Breakers pick is poised to capitalize on much of the growth in digital entertainment. Take deals with Microsoft to support online gaming through the Xbox and with XM Satellite Radio (Nasdaq: XMSR  ) to support streaming its premium channels, for example.

Still, Akamai accounts for only a minuscule portion of the total opportunity. There are dozens of others. Which ones, you ask? Good question. I'd say PwC provided some clues in naming some of the best markets in digital entertainment. Among them:

1.Online and wireless video games. That's right in the wheelhouse for big game-console makers such as Microsoft and Sony (NYSE: SNE  ) . Game publishers, such as Motley Fool Stock Advisor picks Electronic Arts (Nasdaq: ERTS  ) and Activision (Nasdaq: ATVI  ) , should also do well.

2.Online film rental subscriptions. You know the little red Netflix (Nasdaq: NFLX  ) envelope, don't you? 'Nuff said.

3.Licensed digital distribution of music. There's a potentially huge list of beneficiaries here, but none more so than Apple with iTunes and the iPod.

4.Ringtones and mobile music downloads. Another lengthy list, including all the phone makers and mobile service providers. But I'll settle on palmOne (Nasdaq: PLMO  ) and Nokia because their customers tend to trick out their phones more than others I've seen. In that sense, they stand to make some licensing revenue from companies that want a piece of the ringtone biz.

In sum: This is all great news for couch potatoes. If you're among the sedentary set, you might want to give your thumbs a rest and dig into these companies and their competitors. Will it be easy? No, but there's help available in our Rule Breakers service, which you can try for free. But even if you go it alone, we have plenty of tools available to show you how to separate the Rule Breakers from the Faker Breakers. Try these for starters:

Fool contributor Tim Beyers owns shares in Akamai. You can find out what else is in his portfolio by checking Tim's Fool profile, which is here. The Motley Fool has a disclosure policy.


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