Transcript THE ROCKY ROAD TO DIGITAL v. 9.0 THE MEDIA ENVIRONMENT: PRINCIPAL DRIVERS OF CHANGE PBS/Las Vegas - 4/13/05 DAVID B.

THE ROCKY ROAD TO DIGITAL v. 9.0
THE MEDIA ENVIRONMENT:
PRINCIPAL DRIVERS OF CHANGE
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
1
What we’re going to talk about . . .




Principal drivers of change in the media
environment
Some consequences of those changes
Opportunities for public broadcasters
Priorities
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
2
“With most information technology innovations,
we have consistently over-estimated the speed
with which they will unfold and underestimated their eventual impact.”
(attributed to Bill Gates)
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
3
And yet, the direction of change in the media
environment is clear:
None of us should be surprised by what will
happen in the next several years. These
changes will affect us all, as individual citizens
and consumers, and in how we do our work to
fulfill our missions.
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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It is not an overstatement to say that the
transition from analog to digital technologies is
changing everything - content creation,
distribution, content packaging, how our
audiences access our services.
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Despite Bill Gates’ caveat about over-estimating
the rate of change, in recent months we appear
to have arrived at a “tipping point” at which
the rate of change in the media environment is
accelerating exponentially.
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Depending upon your point of view, the emerging
media environment is either:
1) An ideal alignment of the stars, in which it will
be possible for public service media
organizations to address the needs of their
audiences far more effectively than in the past,
OR
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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2) It’s a “perfect storm” of disruptive
technologies, in which marketplace forces will
prevail, making it increasingly difficult to
sustain legacy public broadcasting business
models and to address the public interest.
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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At the very least, we are at what Intel chairman
Andy Grove has referred to as a “strategic
inflection point”, which is that point in the life
of a business or institution at which fewer and
fewer of the old rules apply.
We know that if we continue to do business by
the old rules, there is a high probability of
failure.
But the new rules haven’t been written yet.
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change


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Computer processing power continues to
double every 18 months at no increase in
price. (Moore’s Law)
The cost of digital storage for text, audio,
video data is dropping by 50% every 10
months
Advances in compression continue,
squeezing increasing amounts of
information down same-sized channels or
”pipes”, increasing choice
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

Conversion from analog to digital
technologies
 For cable, one analog channel = eight
digital channels
 Replacement of analog broadcasting by
digital television and radio broadcasting
increases number of broadcast program
services
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change


Digital file formats facilitate cross-platform
exchanges,
 manipulation of content for display on
various devices from cell phones to largescreen HDTV displays
 convergence of functions e.g. cell phones
and handheld devices which “do
everything”
Shift to Internet Protocol provides universal
language for voice (VoIP), audio and video
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

Bandwidth to homes, schools, businesses
continues to increase
 broadband now in more than 30% of US
homes, emerging as audio and video
distribution platform side-by-side with
broadcast, satellite and cable
 fiber to the home replacing copper for
video, telephone, broadband service
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

Verizon’s (and other Baby Bell’s) “Fiber to
the Premises”
 maximum capacities
 fiber-optic cable
400,000 mbps
 coax
850 mbps
 copper twisted pair
10 mpbs
 consumer offer
 FiOS - 30 mbps
 DSL - 1.5 mbps
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

Broadband Over Powerline (BPL)
 FCC approved nationwide rollout in
10/04
 last “100 feet” are wireless
 no need for individual truck-rolls
 also useful to power companies to monitor
their systems
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

Shift from wired to wireless technology
 omnipresent wireless connectivity with cell
phones, WiFi, WiMax, PDAs as universal
handheld multimedia devices for data,
audio, video, telephony
 cities deploying universally-available
wireless
 principal driver of economic
development, educational access
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

Satellite distribution of audio, video and data
provides increasing number of channel choices
(e.g. DirecTV, DishTV, Sirius, XM)
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change
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Technologies which ignore geography (e.g. Internet,
satellite, wireless) erode geographic market boundaries
 exacerbate battles between wholesalers and retailers
over who delivers services directly to consumers
 e.g. Sirius/XM; Comcast/PBS kids channel;
PBS.org; NPR.org
 local becomes global, e.g. audio/video streaming on
line
Undermines foundation of network/member station
relationships
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

the wholesaler/retailer relationship
 True Value Hardware has 6000 member stores
worldwide
 owned by individual storeowners, a retailerowned buying cooperative
 < www.truevalue.com >
 “True Value is no longer selling products online”
 Ace Hardware has 5100 member stores worldwide
 < www.acehardware.com >
 3/12 thru 4/30/05 - order on-line; free shipping if
using “ship to store” option
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

proliferation of GPS (Global Positioning
System)-equipped receivers/display devices
facilitates delivery of location-specific content
and services

evolution of home media servers
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

increasingly sophisticated database
management and data mining capabilities
enable personalization/ customization to match
audiences with content in which they are
interested
 assisted by collaborative filtering,
recommender systems, relationships engines
(“others who ordered this book also
ordered . .”)
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

sophisticated search tools
 required to find stuff on the Internet,
which is turning into a map of the world
as large as the world itself
 Google and Yahoo audio/video search
services, soon Microsoft
 check out http://video.google.com/
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

http://search.yahoo.com/cc

“Options: Find content I can use for commercial
purposes. Find content I can modify, adapt, or
build upon. ..... This Yahoo! Search service finds
content across the Web that has a Creative
Commons license. While most stuff you find on
the web has a full copyright, this search helps
you find content published by authors that want
you to share or reuse it, under certain
conditions.”
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change

miniaturization, wearables, incorporate
ever-smaller computer devices into everyday
objects, including clothing
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Principal Drivers of Change
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Development of “cognitive” or “software defined”
receivers has potential to vastly expand signalcarrying capacity of over-the-air spectrum
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replaces “hard mapped” frequency assignments
with intelligent receivers operating like cell
phones or in-home wireless phones, changing
channels invisibly to assure optimum reception
could facilitate sharing by additional users of
already -occupied spectrum without interference,
e.g. by unlicensed devices
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences
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Audiences becoming used to accessing
whatever content they want, when they want it.
Shift from real-time to non-real time use of
media content using DVRs/PVRs, video on
demand
Broadband facilitates on-demand distribution,
emerges as real time/non-real time
audio/video/interactive distribution platform
(view Comcast spots)
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences
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Increasing capacity of packaged media (e.g.
HD-DVDs)
Proliferation of iPods, MP3 players,
podcasting, soon video iPods
 see < www.pod101.com >
Videogames emerging as content platforms for
education and training, as well as for
entertainment, storytelling, on-line connectivity
 check out Sony PlayStation Portable
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences
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accelerating audience segmentation/
fragmentation
technology facilitates aggregation of selfidentified, self-selected communities of interest
organized around media content and services
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences

Inability of legacy audience measurement tools to track
increasingly-complex media use behaviors
 Nielsen having difficulty tracking use of DVRs,
VoD, broadband, let alone tracking viewing of
hundreds of conventional video choices, multitasking with Internet use
 ratings, *reported* viewership of individual
“channels” will continue to decline
 sample-based measurement being replaced with
proprietary direct measurement technologies, e.g.
VoD, TiVo
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences

Erosion of effectiveness of interruption
marketing, e.g. commercial advertising,
traditional on-air fundraising

challenge for PTV: Develop alternatives to
traditional on-air fundraising before passing
tipping point of core audience alienation
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences
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lowered threshold to entry for content
creators, distributors
barrier to entry to high technical quality also
lowered
plummeting prices for HD production, postproduction equipment reducing cost of
“conventional” production as well
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences
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
technology facilitates interaction between
content/service providers and their audiences
 audiences no longer necessarily anonymous to
communicators or to each other
 “markets are conversations”  < www.cluetrain.com >
 e.g. the “blogosphere”
 modifies mass comm model; evolving to “mass
customization”
facilitates interactivity, not just two way but peer-topeer
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Consequences
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need to understand viewers’ and listeners’
increasingly-complex media use behaviors
initial findings of CPB-funded NPS research
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Opportunities

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Identify and exploit opportunities provided by
geographic location, local retail presence,
physical presence in community
Exploit new opportunities to connect audiences
with content and services in which they’re
interested
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Opportunities

Increasing importance of station’s curatorial
role, trusted “intelligent agent” representing
known editorial sensibilities, “concierge,”
guide
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Opportunities

“The Long Tail” phenomenon
<http://www.wired.com/wired/archive/12.10/tail_pr.>
(session at 3:30 today)

“The Long Tail rebellion” (re: “Eyes on the
Prize”)

< www.downhillbattle.org >
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Opportunities

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need for new rights protocols to facilitate crossplatform as well as extended shelf-life
distribution
check out < www.creativecommons.org >
(Lawrence Lessig/USC School of Law);
The Berkman Center for Internet and Society
at Harvard Law School
<cyber.law.harvard.edu/media/wp2005>
“Copyright and Digital Media in a PostNapster World: 2005 update”
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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BBC Creative Archive Initiative
(Paul Gerhardt/BBC)
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free access to BBC content for learning, for
creativity, for pleasure
members of public will be able to download
cleared TV and radio content, and will be
encouraged to modify and create own
versions to be shared
(“You’ve heard of the long tail - this is the
long march”)
They’ve developed a new license, based on
“the creative commons”
“we want our audiences to rip, mix and
share their BBC”
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
40
BBC Creative Archive Initiative
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tentative rollout: nature and science in ‘05;
news in ‘06; sports in ‘07; drama in ‘08
not everything immediately - based on user
demand
hope to foster a culture of sharing content
and user creation, side by side with
conventional professional production
18 month pilot (4/05 start) will test user
demand, understanding of and compliance
with license terms; impact on existing and
potential enterprises
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
41
BBC Creative Archive Initiative
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
objective is “to work in partnership with
other broadcasters and public sector
organizations (e.g. Channel 4, British Film
Institute, British Library, Open University,
Imperial War Museum, National Museum of
Science and Industry) to create a public and
legal domain of audiovisual material for the
benefit of everyone in the UK”
hope to have Creative Archive fully
operational by 2010
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
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Opportunities

TiVos/DVRs, VoD as opportunities, not threats
to increased viewing
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
43
Opportunities

Exploration of new mission-consistent business
models
 subscription models (e.g. Consumer Reports
on-line)
 permission marketing (“opt-in” - junk mail
is direct mail in which recipient has no
interest)
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
44
Opportunities



Create mission-appropriate alliances with
for-profit media
Create for-profit subsidiaries
Google advertising model
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
45
Opportunities

collaborations with other public service
organizations (e.g. universities, libraries,
museums, cultural institutions)
 evolution toward on-demand digital
libraries creates opportunities to make
common cause
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
46
Opportunities

public broadcasters emerging as “public
service publishers”
(see Dennis Haarsager’s < www.technology360.org > )

position public broadcaster as provider of
production and creative services,
telecommunications services to other public
service organizations
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
47
Priorities

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stay focused on mission
secure expanded rights to content
exploit emerging distribution platforms
 Video On Demand, Satellite Radio (XM,
Sirius), Home Video, Broadband, Podcasting
secure cable carriage for digital broadcast
channels

Recent NCTA/APTS carriage agreement assures
post-transition full-bandwidth DTV carriage, fullbandwidth carriage of one station per market
during transition within duplication ceilings
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
48
Priorities



increase audience research efforts to track
increasingly-complex media use behavior
collaborate with like-minded public service
organizations (universities, libraries, museums)
stay focused on mission
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
49
What we’ve talked about . . .




Principal drivers of change in the media
environment
Some consequences of those changes
Opportunities for public broadcasters
Priorities
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
50
THE ROCKY ROAD TO DIGITAL v. 9.0
THE MEDIA ENVIRONMEN T:
PRINCIPAL DRIVERS OF CHANGE
PBS/Las Vegas - 4/13/05
DAVID B. LIROFF, VP/CTO WGBH BOSTON
51