Play in to Media’s Future


Winding down the week, feels like a good time to post a summary of some of my exploratory research and findings in the media sector.

By media – I am speaking about ‘traditional’ media like broadcast, music, news publishing and video.

This piece reflects on two questions:
i) WHAT is the future of media?
ii) WHO determines this future?

Somehow to understand the WHAT, we have first to understand the WHO.

So, I’ll provide a brief analysis of media’s WHO.


3 Spheres of Influence in Media Creation and Consumption

Media_Content There are three key influencers within the media sector:

content creators, content providers, consumers

– these influencers define the process of creating and consuming media.

External forces such as regulators, government policies, etc, are also influencers that can have a major impact, for better or for worse, on the media landscape. Such external influencers are clearly worth more discussion, but I’ll leave that for another day and forge ahead with the topic at hand.

Considering these three influencers, do all three have equal influence in determining media’s future? Is anyone category the key determinant?


 

The Future of Media is Oliver Twist
To understand the influence of each category in media’s future, we can explore their needs.

Beginning with content providers, “What do content providers want? What is their remit?”
 More content. More consumers. More revenue.

These needs are unanimous irrespective of industries: broadcast, news publishing, music.

How about content creators, “What do content creators want?”
 More discoverability – to make their works widely available to a larger audience
 Fairer royalty payments for their work and content consumption

Finally (but by no means the least important) consumers, “What do consumers want?”
 More choice – the kind of choice that leads to more control
 Cheaper pricing

Yes, the media world seems to be caught in its own Oliver Twist moment with the world constantly demanding ‘more!’
How such demands can be met in a satisfactory manner for all three categories is the challenging question, as the cross category demands appear to be in conflict. But, are they?


 

Media Challenges and Opportunities

  • Music

The music industry’s current status can be summarised as below:
• New content monetisation models are required.
• Fragmentation within the music industry, whereby artists are able to assign exclusive rights to specific streaming providers, is putting strain on the consumer market. Consumers don’t want to pick and choose their streaming music providers based on their favourite artists.

My view on streaming is that providers have to evolve to more creative affiliate models to achieve a ‘happy’ balance across their needs, and the needs of artist creators and consumers.

As I write this, a BBC news interview by #VictoriaLIVE [2] discusses UK Music sales and the fact that in 2015, the British Music Industry experienced one of its best years, with 1 in 6 global album sales by UK artists. However, despite this success, revenue growth has stalled – largely attributed to external platforms cutting into revenue streams of labels and artists: audio streaming platforms (£146Million); YouTube (20% video consumption and associated revenue) and shared viral videos (unaccounted).


 

  • Broadcasting

The summary of the broadcast industry can be viewed as:
• Revenue shrinkage linked to activities of ‘cord shavers’ (media consumers who shrink their cable subscription packages), ‘cord nevers’ (media consumers who have never subscribed to a traditional PAY TV service) and ‘cord cutters’ (media consumers who cancel their cable subscription packages) is on the rise
• Media consumers’ have a rising desire to pay for only what they consume.

A study conducted by Forrester Research and summarised by Wall Street Journal[1] revealed that whilst ‘cord cutters’ were previously seen as the major threat to the future of cable, ‘cord nevers’ are “a burgeoning group that could pose an even bigger threat” to TV. These group of media consumers believe they can do without TV subscription services and consume most of their media via online platforms such as Netflix and YouTube.

The activities of ‘cord shavers/nevers/cutters’ have been attributed to the fall in share prices of cable broadcasters since mid-2015.


 

  • News Publishing

What can be said about the future of News Publishing?

A MoneyWeek article [3], highlights major challenges faced by newspaper brands such as falling circulation figures, dipping advertising revenue, job cuts, etc. Whilst all of this may not be much news, it appears that many traditional news publishers are struggling to change course in the right direction. Quoting MoneyWeek – based on comments by the owner of The Independent, “The industry is ‘in denial’ about the challenges it faces”.

Online only news sites are faring better with money they generate from online advertisers.

But, in an ironic twist as to the future of TV versus digital news channels, an article published in the Financial Times[4], cites examples of digital news upstarts turning their attention to television, as they face challenges to steady advertising revenue streams.

The article hinted at BuzzFeed’s possible interest in creating programming that could one day air on television. This is a move that another digital news startup Vice Media has made, launching a series of programmes that air on HBO and even recently launching its own cable channel: Viceland.

It appears that for startup digital news publishers, cable TV provides higher and more reliable revenue streams than the online space – especially as TV gives them opportunities to license content and rely less on advertising.


 

– Immersive Videos

Virtual Reality (VR) technology is presently a major uptrend in the media space.

In 2016, there has been a lot of buzz about upcoming media trends such as Virtual Reality which was liberally highlighted at the 2016 Mobile World Congress, by multiple tech players including: Facebook, HTC, LG, Samsung, and more. All these big technology players had consumer models of their VR headsets on show at the Congress.

Statistics reveal on average, US adults consume 5.5 hours of video per day, and a media expert friend of mine with 20 years sector experience, informs me that there is an increasing consumer interest in viceral and immersive technologies.

Such positive indications as to consumers’ interest in immersive technologies and videos shed light on why VR technology is presently seen a candidate for big wins in the media space.
Personally, I consider the work of the company immersive media as they innovate with 360 degrees videos and develop ‘groundbreaking’ campaigns for clients, really interesting.

 


FULL CIRCLE Summary

The highlighted challenges point to areas of opportunities where innovative companies: established, entrepreneurs and startups alike, can really help to shape media’s future.

  • Companies that are willing and able to balance the needs of the three key influencers in media space are sure to win big.
  • Consumers want more control, flexibility and content. It’s a demand that is not unique to one but applicable to all media industry sectors.
  • With revenue streams dwindling, it is surely high time for affected media players to change course in the RIGHT direction with fresh solutions.
  • The future of media depends on fresh ideas that can be quickly moved to workable solutions.

Any takers?…

With lots of ideas buzzing through my mind and already passing through my

separation -> sieving -> shifting analysis*,

I’m in!

 

* separation (grouping), sieving (wheat from chaff) and shifting (step up)

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If you would like to find out how I can help you bring fresh solutions to your business by exploring, forming new ideas or shaping existing ideas in the media, technology, mobile space, please get in touch: linda@bluewaterhebron.com

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[1] http://www.wsj.com/articles/tvs-looming-threat-cord-nevers-1444151008
[2] BBC TWO TV News, Victoria Derbyshire (#VictoriaLIVE ), 20 May 2016
[3] “The death of the newspaper,” MoneyWeek Article – 06 May, 2016
[4] “Digital news start-ups switch on to TV,” Financial Times Article – 21 April, 2016

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