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Children's market still young

A new study shows that the online children's market is fairly small but will get a lot bigger.

Every time a child logs on to the Net, Al Gore gets that warm feeling, knowing that he's getting closer to his goal of wiring America's classrooms.

Today the vice president took his campaign to Sacramento, speaking to educators and lawmakers about new legislation that will integrate learning technology into teacher training programs and curricula for kindergarten through 12th grade.

But businesses aiming to cash in on the potentially lucrative children's market--well, they're not sharing Gore's warm feelings. At least not yet.

Despite the proliferation of children's software, the promises to make the Web fun to surf, and the fact that more children are logging on every day, Web businesses aimed at youths just aren't making a lot of money.

That's the conclusion of a Jupiter Communications study released today. "The kids market is still struggling to find its footing in the online marketplace," according to the study.

Unless you're America Online (AOL). AOL "currently dominates the landscape for children's online content--and will continue to do so over the foreseeable future," the report states.

That scenario could change, however, as media conglomerates such as Disney and Nickelodeon get their acts together with comprehensive kids-oriented sites.

Government initiatives like Gore's also could also give business a good shot in the arm, according to the study. "With increased government initiatives--and pressure--aimed at wiring public schools for Internet access, the growth in the number of kids with access to the Web from the classroom is expected to increase from 1.5 million in 1996 to 20.2 million in 2002," the study states.

But for now, revenues from the online kids market remain pretty small: At the end of 1996, they totaled $306 million. However, by the end of 2002, Web developers that have stuck it out could be richly rewarded, with revenue reaching an estimated $1.8 billion.

Meanwhile, the industry needs to focus on some crucial issues. Parents are--and will remain--concerned about their children being protected online. That means the Web will have to not only be safe from adult-only content, but also from marketers preying on children.

Jupiter released the study in anticipation of its online conference Digital Kids II, to be held in San Francisco in June.