Global Media Industry

ICT Expert Training Program Lecture 1

Transcript

1. GLOBAL MEDIA INDUSTRY Present by Inho Cho Ph.D.
2. OVERVIEW
3. OVREVIEW  In 2010, The industry began to stabilize. However, at the same time, change became integral to this new stability. New models were experimented with, while each medium began to truly embrace a digital world. News organizations sloughed off the barriers of tradition and went mobile as well as digital-first.  Television and the Internet continued to converge with new platforms like Smart TV. Meanwhile, it began to look like the future of Internet radio may be in cars. The social media revolution invaded newsrooms everywhere, demanding that the media truly engage their audience on a new, personal level.
4. OVREVIEW  In 2010, hundreds of newspapers and thousands of magazines had folded. The number of folds were getting fewer, but traditional media continues to move in a new media direction. Approximately 102 magazines launched as digital-only or went exclusively online, while hyper-local newspaper-type sites grew rapidly.  The media appears to be evolving. Online staffs are growing and social media editors are becoming a mainstay in newsrooms. Although there are still losses within the industry, successful organizations are adapting to move forward.
5. NEWSPAPERS  After witnessing a newspaper industry massacre, the industry seems to have stabilized “Something had to change as the newspaper business was hemorrhaging jobs and money,” says Coates. “It was a Darwinian environment and only the strong remain. Those newspapers that adapted to the changing media and distribution of news survived, and those that didn’t died.”  Many of the survivors were community newspapers that understood how to successfully connect with their readers online and in print
6. NEWSPAPERS  As we move into 2012, newspaper organizations continue working to merge print and online products in a cohesive way to produce news. “In the future, the success of newspapers will not be measured by printed circulation but in terms of impact through whatever brand reaches the public. However, success is measured by the bottom line and the future is still a little murky as to how these brands will turn a profit in terms of online advertising, paywalls and computer tablet apps. Stay tuned.”
7. MAGAGIZINES  Over 2010, the industry stabilized enough for more magazines to launch than to fold – with a total number of 169 launches and 167 folds. “The Atlantic, for the first time in a decade, is not losing money. It attributes much of that success to taking down its paywall and putting younger writers on a Web-first deadline, as well as merging the print and digital sales teams. For larger-tier magazines like the ones at Time Inc., you’re going to need a bigger boat: one that makes bigger moves resulting in bigger waves.”  The trend in magazine launches was toward local and regional: a perfect example of how popular the hyperlocal concept has become among all media.
8. MAGAGIZINES  Many of the launches were in the health and food niches, including Dash, Athlon Sports, Yum Food & Fun, Made Possible, and Where Women Cook.  Meanwhile, 49 digital and online magazines launched this year, while 53 print products went online-only.  The industry hasn’t completely recovered: Advertising revenue was barely up from 2009. And consumer magazines saw more substantial gains than other magazine titles.  The industry expects digital content, applications and mobile devices to grow in popularity even further: In 2011, around 50 magazines have applications for the iPad, and that number is always growing.
9. RADIO  In a changing media world, the future of radio is uncertain “The assumption is that with all the new technology available—Internet radio, satellite radio and iPods—giving consumers more and more listening options, traditional radio will soon go the way of newspapers. A cursory look indicates that this might be the case.” A survey by Forrester Research reports that terrestrial radio use is down 15 percent over the last five years—and while online media is growing, only one in four people surveyed said they listened to streaming audio. Arbitronreports that radio in the top ten markets achieved more listening time in 2010 than in 2009.
10. RADIO  Radio is moving into a mobile age.  A sampling of 18 smartphone users aged 18-49 found that many rely on their devices for listening to music as well as news. (Arbitron & Jacobs Media)  Radio has a built-in audience that it can direct to its mobile applications. What is clear is that radio must create a mobile strategy for the future.  Meanwhile, more online resources are popping up all the time.  Customizable music services like Pandora, Last FM, Yahoo! Music and MySpace Music are becoming more popular.  Sirius XM Radio is doing fairly well. HD radio, which allows multiple radio streams on a single channel can be the future of radio. But, problems remain…
11. BROADCASTING INDUSTRY
12. BROADCASTING INDUSTRY USA UK FRA GER RUS JPN CHN IND AUS BRA TV revenue 59.4 7.1 6.6 6.9 2.2 18.1 4.0 4.2 3.0 6.7 Revs change (%, YOY) 6.3 8.5 8.8 2.0 16.6 6.2 13.6 17.7 9.9 17.6 Revenue per cap 192 114 101 85 16 143 4 4 138 34 From advertising 73 37 29 26 13 66 3 1 69 21 From subscription 118 49 52 29 3 52 1 3 49 12 From public funds 1 28 20 30 0 25 0 0 20 1 TV license fee n/a 92 65 117 n/a 111 n/a n/a n/a n/a Largest TV platform Dcab Dsat DTT Dsat ATT Acab ATT Acab DTT Dsat % of homes 39% 42 38 34 36 25 33 59 43 39 TV viewing (mins/day) 283 242 212 223 226 n/a 158 119 188 222 No.1 channel share (%) 7 21 25 14 17 n/a 7 9 18 42 DTV take-up (%) 87 97 93 62 34 66 33 29 75 59 Pay TV take-up (%) 88 52 57 63 55 60 52 82 31 18 DSO date 2009 2012 2011 2008 2015 2011 2015 2013 2013 2016 Source: IDATE / industry data / Ofcom / Mediametrie, Eurodata TV Worldwide.
13. BROADCASTING INDUSTRY  Some of the key market developments  Recovery from 2009 in global TV revenues  Global TV revenues increased in 2010 (by 7.7%), following a recovery in the advertising market (up 9.9% since 2009)  Continued growth in pay-TV subscription (up 7.1% since 2009)  Digital video recorders  Video on demand  High-definition television  Three-dimensional TV  Public funding  Usually sourced from TV license fees or government grants  Revenue from this source has been relatively stable
14. GLOBAL TV REVENUES 0 50 100 150 200 250 300 350 400 2006 2007 2008 2009 2010 Revenue Revenue
15. BROADCASTING INDUSTRY REVENUES BY SOURCES 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2006 2007 2008 2009 2010 Advertising Public funds Subscription
16. BROADCASTING INDUSTRY ANTICIPATIONS  Key Anticipations  VOD market will exceed PPV market  Mobile broadcasting and OTT (Over-The-Top) markets will grow significantly for the next five years  Advertising accounts for about 45% of TV industry revenues and the proportion of advertising will continually increase by 2015  Subscription TV, OTT and VOD will lead TV industry for the next five years
17. BROADCASTING INDUSTRY REVENUE ANTICIPATION 2010 2011 2012 2013 2014 2015 Subscription 163,394 176,701 191,249 205,568 220,489 235,764 OTT 244 420 641 961 1,399 1,954 VOD 4,870 5,734 6,731 7,578 8,409 9,215 PPV 4,273 4,239 4,227 4,199 4,200 4,224 DMB 1,097 1,256 1,610 2,035 2,681 3,365 Public funding 29,205 29,350 29,751 30,233 30,474 30,697 Sub-total 203,083 217,700 234,209 250,574 267,652 285,219 Advertising 169,770 175,380 192,951 202,610 224,434 232,648 Total 372,853 393,080 427,160 453,184 492,086 517,867 Source: PWC (2011)
18. BROADCASTING INDUSTRY: REGIONAL ANTICIPATIONS  North American market accounts for about 42% of the industry  All regional market are expected to grow in the next five years; especially, Asia-pacific and South American markets are expected to grow by more than 10 %  Regarding advertising revenue, Asia-pacific market is the second biggest one  North America: 74,251  Asia-pacific: 41,233  EMEA: 40,747  South America: 13,539
19. BROADCASTING INDUSTRY: REGIONAL ANTICIPATIONS 2010 2011 2012 2013 2014 2015 North America EMEA Asia-Pacific South America 83,395 72,557 34,211 12,920 88,569 76,674 37,720 14,737 94,055 81,381 42,043 16,730 99,100 86,178 46,463 18,833 104,756 90,761 51,175 20,960 110,653 95,370 55,883 23,313 Subscription & Public funding 203,083 217,700 234,209 250,574 267,652 285,219 North America EMEA Asia-Pacific South America 74,251 40,747 41,233 13,539 74,699 42,944 42,983 14,754 83,133 45,959 47,320 16,539 84,168 48,764 51,769 17,909 92,350 52,560 57,265 22,259 94,323 55,414 61,484 21,427 Advertising 169,770 175,380 192,951 202,610 224,434 232,648 Total 372,853 393,080 427,160 453,184 492,086 517,867 Source: PWC (2011) *EMEA: Europe, Middle East, Africa
20. BROADCASTING INDUSTRY  Some of the key market developments  Digital TV gained ground in many nations  Different digital TV penetration types  Almost complete digital conversion: UK (97%), France (93%), Spain (98%), etc.  Digital TV available in 60% to 80% of homes: Germany (62%), Japan (66%), Sweden (63%), etc.  Analogue platform predominating: Russia (34%), China (29%), India (33%), etc.  Different growth rate in the take-up of digital TV platforms  Rapid increase: Brazil (20%), Ireland (18%)  Mainly affected by digital swhichover
21. TAKE-UP OF DIGITAL AND ANALOGUE TV, 2010 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Analogue Digital ( ) year-on-year change
22. BROADCASTING INDUSTRY  Some of the key market developments  Different penetration of IPTV  Although IPTV is becoming a viable alternative in many countries, it can be challenging to gain a foothold due to the availability of well-established competing digital platform technologies  Take-up of IPTV in France increased by almost a third in 12 months to reach nearly a quarter (24%) of French main television sets in 2010, making it the second most popular platform after DTT
23. IPTV TAKE-UP ON MAIN TV SETS, 2010 0 5 10 15 20 25 30 2004 2005 2006 2007 2008 2009 2010 GER ESP US NED SWE FRA Source: IDATE/industry data/Ofcom
24. BROADCASTING INDUSTRY  Some of the key market developments  Value-added services on DTV platforms growing in popularity  Consumers continue to embrace high definition TV, as channel line-ups grow  HDTV in France and the US entered the mainstream, with penetration for the first time reaching a majority of households (60% (up by 18pp) and 54% (up by 9pp) respectively)  Platforms responsible for delivering HD content differ across countries
25. GROWTH IN THE NUMBER OF HDTV 0 10 20 30 40 50 60 70 2007 2008 2009 2010 GER UK ITA JPN US FRA
26. NUMBER OF HD HOMES, BY PLATFORM 0 10 20 30 40 50 60 70 US UK,FRA,GRE,ITA JPN Satellite Cable IPTV DTT
27. BROADCASTING INDUSTRY  Some of the key market developments  Digital video recorders are now widely available in countries  Take-up was highest in the US at 41%, followed by the UK  Technologies that have become available more recently are beginning to gather momentum among consumers  Internet-connected TV: 13% in France, 9% in Australia,7% in the UK and the US it was 7%.  3D TV: 10% in Italy 8% in Germany, 7% in France and 6% in the UK and Australia  Watching TV content over the web is continually increasing
28. BROADCASTING INDUSTRY  Revenue growth in 2010  Most countries experienced revenue increase in 2010  Growth was largely driven by increases in advertising, with the exception of India  The combined revenues of Europe and Canada still fall below the US  All BRIC countries experienced TV revenue increase in 2010  India: 17.7%  Brazil: 17.6%  China: 13.6%  Russia: 13.6%
29. BROADCASTING INDUSTRY REVENUES 0 20 40 60 80 100 120 140 160 2004 2005 2006 2007 2008 2009 2010 USA Europe/Canada Japan/Australia BRIC
30. BROADCASTING INDUSTRY  Revenue composition  Revenues among the major European TV markets all grew and generated a relatively consistent revenue mix among subscriptions, public funding and net advertising  Pay-TV was the fastest-growing source of revenue  US experienced relatively flat TV advertising revenues over the five- year period  Japan experienced a decline in advertising revenues while revenues from pay-TV subscriptions remained constant  BRIC countries experienced an increase in net advertising revenue and subscriptions, but they are notable for a lack of public funding
31. BROADCASTING INDUSTRY: REVENUE PER HEAD  The US continues to generate the most revenue per head ($482 per head in 2010, and increase of 15% year on year)  Major European market except UK recorded declines in per- capita revenues in 2010  Advertising and subscriptions revenues per head bounce back in 2010  Public funding, in the form of TV license fees paid by viewers, remains an important element of TV finance in major European markets  Pay-TV companies continue to outperform their free-to-air counterparts (ex., Comcast, BSkyB)
32. BROADCASTING INDUSTRY: TV AND CONSUMER  Digital TV take-up on main sets  In the UK, Spain and France, nine in ten homes had digital television by the end of 2010, with take-up reaching 97%, 98% and 93% respectively. In the US, the comparable figure was 87%.  Year on year, growth in digital television take-up was greatest in Brazil, where penetration rose by 20 percentage points. In the Republic of Ireland, DTV take-up increased by 18pp, while in Spain and Australia it increased by 14pp.  Despite the growing take-up of a range of digital media technologies, minutes per head of TV viewing rose in 2010 in many countries.  TV was most popular in the US in 2010, where viewers watched an average of 283 minutes per day, up by 1.1% year on year. In Italy, the comparable figure was 246 minutes (up by 3.4% over the year), in Poland 245 minutes(2.1%), and in UK 242 minutes (7.6%).
33. TAKE-UP OF DIGITAL TV Take-up (2010) (%) 1 yr growth (%) 5 yr growth (%) ESP 98 16 27 UK 97 3 7 FRA 93 17 25 US 87 5 10 IRE 83 29 16 ITA 78 10 15 CAN 78 13 12 AUS 75 22 21 NED 68 17 31 JPN 66 3 8 SWE 63 10 13 GRE 62 24 25 BRA 59 52 18 POL 56 17 35 RUS 34 34 66 CHI 33 34 91
34. BROADCASTING INDUSTRY: TV AND CONSUMER  Take-up of high-definition services has entered the mainstream in several countries, reaching 60% of all homes in France (up by nearly half on the year). In the US the figure was 54% (an increase of one fifth) and 40% in Japan (little changed over the period). In the UK, HDTV was available to a fifth (21%) of homes – up by over half year on year.  Digital video recorders are increasingly prevalent among homes in comparator countries. Across the UK, France, Germany, Italy, US and Spain, nearly three in ten households had a DVR connected to their main set. Take-up of these devices was highest in the US, where take-up stood at 41% in Q4 2011 (up by 2pp year on year). The UK ranked second, with penetration rising to 36% over the period (up by 4pp – the largest increase among the countries in this survey).
35. BROADCASTING INDUSTRY REVENUES BY NATIONS KOR US UK GER FRA JPN CHI Subscription TV OTT VOD PPV Mobile Public funding 2,011 - 309 8 252 325 69,047 244 2,746 2,843 486 - 7,491 - 175 76 3 4,205 5,021 - 188 20 1 6,261 9,136 - 268 125 90 3,115 5,679 - 245 22 41 6,128 7,004 - - - 11 - Sub-total 2,905 75,366 11,950 11,491 12,734 12,115 7,015 Advertising 1,674 70,693 5,541 5,430 3,615 16,826 9,115 Total 4,579 146,059 17,491 16,921 16,349 28,941 16,130 Source: PWC (2011)
36. BROADCASTING INDUSTRY BY NATION: UNITED STATES 2009 2010 2011 2012 2013 2014 2015 Subscription TV OTT VOD PPV Mobile Public funding 67,474 119 2,490 2,923 504 - 69,047 244 2,746 2,843 486 - 73,116 409 3,142 2,777 486 - 77,428 545 3,537 2,711 504 - 81,454 760 3,753 2,623 540 - 85,868 995 3,976 2,531 720 - 90,489 1,239 4,205 2,439 900 - Sub-total 73510 75366 79930 84725 89130 94090 99272 Advertising 64840 70693 71139 79324 80160 87853 89840 Source: PWC (2011)
37. BROADCASTING INDUSTRY BY NATION: UNITED STATES Players 2010 (3rd quarter) 2010 (4th quarter) 2011 (1st quarter) N (mil) Share N (mil) Share N (mil) Share Comcast DirecTV DISH Network Time Warner Cable Cox Communications(e*) Charter Communications Cablevision Other(e) 22.9 18.9 14.3 12.6 6.1 - 3.0 15.1 23.5 19.4 14.6 12.9 6.2 4.8 3.1 15.5 22.8 19.2 14.1 12.4 6.2 4.5 3.3 15.1 23.3 19.7 14.5 12.7 6.3 4.6 3.4 15.5 22.8 20.3 14.2 14.5 n/a 4.9 3.7 15.5 23.8 21.2 14.8 15.1 n/a 5.1 3.8 16.2 Total 97.6 97.7 95.8 Source: PWC (2011) *e = estimation Subscription TV Market
38. BROADCASTING INDUSTRY BY NATION: UNITED STATES Subscription TV Market  Cable  The number of cable TV subscribers has decreased for a few years and the future of cable TV is not rosy. • The rise of cable subscription fee • Ongoing competition with satellite TV • Competition with broadband providers such as AT&T and Verizon who now offering mobile broadcasting services • Competition with video streaming sites such as Netplix and Hulu
39. BROADCASTING INDUSTRY BY NATION: UNITED STATES Mobile Broadcasting  While worldwide mobile broadcasting market is rapidly growing, the growth in US is weak  According to OMVC (Open Mobile Video Coalition), it is estimated that 126 mobile digital TV stations will be in service by the end of 2011  Mobile Content Venture (MCV), a joint-venture comprised of 12 major broadcast groups including NBC, working to create the Dyle Mobile TV service in order to provide live video content to mobile devices including local and national news, and sports and entertainment programming
40. HOW PEOPLE WATCH 2-11 12-17 18-24 25-34 35-49 50-64 65+ On Traditional TV 22:52 22:24 24:17 28:08 32:58 41:04 46:16 Watching Timeshifted TV 1:50 1:29 1:30 2:57 3:07 2:42 1:42 Using the Internet on a Computer 0:30 1:25 4:02 6:03 5:50 4:58 2:38 Watching Video on Internet 0:07 0:21 0:45 0:50 0:35 0:23 0:12 Mobile Subscribers Watching Video on a Mobile Phone 0:20 0:17 0:12 0:05 0:01 Weekly Time Spent in Hours: Minutes – By Age Demographic for US Population Source: Nielsen (2011)
41. HOW PEOPLE WATCH Q2 2011 Q2 2010 % Diff Yr to Yr Watching TV in the home 146:20 143:37 1.9 Watching Timeshifted TV (all TV homes) 10:30 9:27 11.1 DVR Playback (only in homes) 24:29 24:27 0.1 Using the Internet on a Computer 24:25 25:07 -2.8 Watching Video on Internet 4:26 3:52 14.7 Mobile Subscribers Watching Video on a Mobile Phone 4:20 3:37 19.8 Weekly Time Spent in Hours: Minutes – By Age Demographic for US Population Source: Nielsen (2011)
42. CHANGING MEDIA CONSUMPTION
43. CHANGING MEDIA LANDSCAPE DISTRIBUTORS Cable, Satellite, Telecom CONTENT OWNERS TV Networks and Studios DEVICE MANUFACTURERS TVs, STBs, Handsets SERVICE INNOVATORS Digital natives
44. CHANGING MEDIA LANDSCAPE TV viewing is not disappearing, but there are some changing trends There is a clear shift in behavior in the younger audience. With this group social media has become a direct competitor for time share. Source: BAEB 2011 Weekly hours of TV viewing
45. CHANGING MEDIA LANDSCAPE  Media consumption patterns  People are actively exploring new TV/Video technologies  …and are looking to enrich their viewing experience  There are not many established consumption patterns (except the ‘old’ ones)  More than 70 % are “time-shifting” on a weekly basis 1, and 50% are using internet based on demand TV/video every week  Business disruption  TV/Video consumption is fragmented and complex  New types of entrants in the market  A trial and error market with lots of curiosity around  No obvious global leadership (source: Erison ConsumerLab 2010)
46. CHANGING MEDIA LANDSCAPE TV Computer Mobile Tablet Convenient & Relaxing Time shifting Only screen around Media consumption High quality Free & unlimited To kill time & in transit Internet + email Social Lean forward Communication Socially acceptable Lean back Multitasking While waiting Domesticated mobile Fighting loneliness Personal Very personal Entertaining kids Competing Devices  Each of the dominant screens has some strengths for TV consumption  It’s not a choice between the screens, a strategy has to include all key screens
47. THE FUTURE OF TV!? Both Samsung and LG are offering ‘smart TVs’, all-in-one media experiences in the living room. Is this experience what people want?
48. THE FUTURE OF TV!? The NFL iPad app is designed to be the perfect companion for the TV experience (stats, info graphics, social features, background info). Is this experience what people want?
49. SEAMLESS EXPERIENCE ACROSS DEVICES Cross-platform access, ubiquity, and fluidity is the next frontier of the digital service battle. Companies like Amazon (whisper synch), Google (Maps, Android), and Apple (iCloud) are leading the way.
50. SEAMLESS EXPERIENCE ACROSS DEVICES BBC iPlayer  BBC iPlayer is available on 4 key platforms Usage is stabilizing around 150m views/ month, and 1.5m unique viewers per day In an on-demand world, discovery becomes a strategic user experience issue Web Mobile Consoles TV
51. SEAMLESS EXPERIENCE ACROSS DEVICES Netflix With over 20million members globally, Netflix is the leading Internet subscription service streaming movies & TV episodes. Netflix members can instantly watch unlimited streamed movies & TV episodes.
52. SERVICE CHALLENGES  As home entertainment is becoming inherently interactive, the experience should be service-led, rather than one of distribution  TV service design is about stitching things together to a coherent experience  There is the need to support two potentially conflicting needs  Simplicity and inclusiveness: over 50% think simplicity is very important  Individual passions Effortless enjoyment Flexible and individual Simple service activation One account Simple and transparent billing Lean-back optimized Social and inclusive Scales to many screens and devices Includes web interactivity Supports playlists, sharing, queuing Scales to UGC sharing, text input, etc. Smart search and recommendations
53. OPPORTUNITY  No clear international leadership in the domain  With increased viewer flexibility comes complexity and confusion  Key focus will be on service coherence, elegant media discovery and control, and multiple device usage  There’s a massive opportunity to do for the media industry what Amazon did in retail and Apple in music and telecom  User-focused design – rather than technology – is at the forefront of innovation and change