Transcript Up-date Gesamtvermarktung

Strategic outloook
for media:
technology,
economy, content
Annet Aris
SVIAZ-Expocomm
Day of Mass Communication
Copyright 2011 Annet Aris. No part of it may be circulated, quoted, or reproduced for
distribution without prior written approval from Annet Aris. This material was used by
Annet Aris during an oral presentation; it is not a complete record of the discussion.
May10, 2011
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Is the digitization of media a blessing or a curse?
For discussion
Blessings
 More consumer value:
transparency, access, choice,
own contribution
 Higher advertising „Return on
Investment“: better targeting,
measuring, performance
based pricing
Curses
 Lower willingness to pay, piracy
 Exponential growth of advertising
inventory
 Winner takes it all?
 Lower costs:
production,distribution,
storage
Source: Annet Aris
1
Digital consumers behave like a kid in a candy store
Low WTP
for content
Lower
content
quality
More
advertising
Less
income/
more ads
Lower
effectiveness
Lower
rates
Source: Annet Aris
2
Impact of digitization on industry structure
Monopoly
Key characteristics
• No competition
• High barriers to entry
• High profitability
• Low consumer benefits
Examples
• US telco’s/cable co’s
• US local newspapers
Source: Annet Aris
Impact
digitization
Perfect
competition
Oligopoly
•
•
•
•
•
•
•
Limited competition
Medium barriers to entry
Profitability depends on
industry conduct
Medium to high consumer
benefits
TV broadcasters
German magazines
Music majors
•
•
•
•
High competition
Low Barriers to entry
Low profitability
Medium to high consumer
benefits
•
•
•
Independent TV
producers
Free lance journalists
Book publishing
3
Industry structure in the analogue media world
Content
packager
Content Creator
Exam- •
ples
•
Artists
TV/Movie
Producers
Sport
associations
Journalists
•
•
Industry •
structure
•
•
Share of •
value add•
•
•
•
•
•
•
Mostly
•
competion
Some
oligopoly •
Hollywood)
Monopoly for
owners of hit
rights
High (hits)
Low (rest)
Source: Annet Aris
•
Content bundler
TV channels
•
Newspapers/ •
magazines
•
Music majors
Book publishers
Game publishers
Radio channels
•
Pay TV
Cable operators •
•
(Retailers)
Mostly well
•
behaved
oligopolies
BtE: distribution •
scarcity,
purchasing
power
Monopoly or
competitve
oligopoly
Some
competion
between small
retailers
High to medium •
High to low
•
Platform
operator
Hard-/ Software
provider
Terrestial
Satelitte
Cable
•
•
Monopolies or •
oligopolies
BtE: investment•
in infrastructure
•
•
•
High to medium
TV
Game console
Competitive
oligopolies
BtE: IP,
investment in
production
facitlities
Medium to low
Negative impact
Uncertain impact
Impact of digital on industry structure
Content Creator
New
entrants•
•
•
Consumers •
Hidden
•
talents
Crowds
Content
packager
Positive impact
Content bundler
•
Websites
•
Applications •
Search
Portals
Social
networks
E-commerce
•
•
Impact on •
Industry
structure
More
•
competion
Competitive
oligopolies
•
•
Functional
monopolies?
Impact on •
share of •
value add
Higher (hits)•
Lower (rest)
Medium to
low
•
High
*BtE= Barriers to entry
Source: Annet Aris
•
Platform
operator
Hard-/ Software
provider
Telecom
•
•
•
Mobile
Set top
PC
Competitve
oligopolies
•
Competitive
oligopolies
Medium?
•
High to low
5
Convergence of platforms leads to vertical integration
Content Creator
Video •
•
Internet
•
•
Content
packager
TV/Movie •
Producers
Sport
associations
TV channels •
• Free
•
• Pay
Pay TV
Cable
operators
Webeditors •
Users
Content sites •
•
Portal
Search
Fixed • User
Line voice
Mobile •
Voice •
User
•
Mobile
content
developers
Source: Annet Aris
Mobile
operators
•
Mobile
operators
Hard-/ Software
provider
Platform
operator
Content bundler
•
•
•
Terrestial •
Satelitte •
Cable
•
ISP‘s
TV
Set top box
•
•
PC
Game consoles
•
•
•
Telco‘s
FVNO
Telephone
manufacturers
•
•
Mobile
operators
MVNO‘S
Mobile phone
manufacturers
•
6
Convergence drives integration
Content
packager
Content Creator
Video •
•
Internet
•
•
TV/Movie
•
Producers
Sport
associations
TV channels •
• Free
•
• Pay
Pay TV
Cable
operators
•
•
•
Terrestial
Satelitte
Cable
•
•
TV
Set top box
Webeditors •
Users
Content sites •
Portal
•
ISP‘s
•
•
PC
Game consoles
•
•
Telco‘s
FVNO
•
Telephone
manufacturers
•
Mobile
operators
MVNO‘S
•
Mobile phone
manufacturers
Fixed • User
Line voice
Mobile •
Voice •
Hard-/ Software
provider
Platform
operator
Content bundler
User
Mobile
content
developers
Source: Annet Aris
•
Mobile
operators
•
Mobile
operators
•
7
..and even diagonal integration
Content
packager
Content Creator
Video •
•
Internet
•
•
Hard-/ Software
provider
TV/Movie
•
Producers
Sport
associations
TV channels •
• Free
•
• Pay
Pay TV
Cable
operators
•
•
•
Terrestial
Satelitte
Cable
•
•
TV
Set top box
Webeditors •
Users
Content sites •
Portal
•
ISP‘s
•
•
PC
Game consoles
•
•
Telco‘s
FVNO
•
Telephone
manufacturers
•
Mobile
operators
MVNO‘S
•
Mobile phone
manufacturers
Fixed • User
Line voice
Mobile •
Voice •
Platform
operator
Content bundler
User
Mobile
content
developers
Source: Annet Aris
•
Mobile
operators
•
Mobile
operators
•
8
Fundamental change in the rules of game
Pre digital
Media essentially local and
highly decentralized
Source: Annet Aris
Post digtal
Network externalities and
global scale
9
Apple’s ecosystem
iBooks
iTunes
account
iTunes
account
Ads
Apps
10
Google creates major network benefits through systematic learning
Continuous
Experimenting and
Learning !
Build up of server infrastructure
More and better free consumer services
Paid content services
Larger and better advertising offering
Network effect
Cost effect
Source: Annet Aris
Adwords
Adsense Admob
11
Fundamental change in the rules of game
Pre Internet
Media essentially local and
highly decentralized
Post Internet
Succes increasingly driven by
network externalities and
global scale
Mass marketing
Customer lifetime value
Company based competition
Ecosystem based competition
Exposure based advertising
Source: Annet Aris
Marketing ROI
12
Media in the future: who will
win?
When we are not careful:
nobody!
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IMPLICATIONS FOR MEDIA COMPANIES
•
Less is more: prevent the negative content/advertising
spiral, go for high impact content and advertising
•
Focus more on how to grow the digital pie together rather
than on how to share the pie
•
Don’t reinvent the wheel: Learn and create own network
effects (content communities?)
•
Innovate not only content and medium but also business
models, dare to take risks based on your consumer
insights..
•
Build the right capabilities for a volatile world (people,
organization)
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EVERYTHING ELSE YOU WANT TO KNOW CAN BE FOUND IN:
[email protected]
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