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Sunday, October 16, 2005

The 300 Billion USD Plus TV Industry - Audience Shift & Chaos Scenario – Part II

We covered in Part1 Jeremy Allaire's view that a range of macro forces helping to force a collision between the Internet and the world of video and television distribution. Continuing with the discussion we examine more of his view here - The shift in format and distribution focus for the major film studios, turns the attention away from broadcast syndication after-markets or TV output deals, and towards the much more lucrative opportunity presented through pay media and direct distribution through retail DVD sales, underscoring how digital technology even fragments distribution at the high-end of the video food chain. We earlier wrote that With Internet TV startups the cost of distributing video over the Internet for a program is much lower than broadcasting shows to millions of homes simultaneously, regardless of who actually sees them. Many special-interest shows might prove economical for the first time, while others already recorded might find fresh audiences. Finally, and crucially, over the past decade, the Internet has become the primary media and entertainment source for consumers worldwide, taking their time and attention away from broadcast and into broadband—media that offers them powerful communications tools, highly targeted content and communities of interest, dramatic choice and control, and commerce vehicles that are unmatched by traditional media and retail. A range of technology and business process drivers are forcing this opportunity:
- Global broadband reach
- Home and wireless networks that make it possible to move high-quality video media over open networks.
- Powerful and open media formats that deliver rich, interactive media experiences that have not been possible on television (e.g. Macromedia Flash), and compressed and downloadable formats that deliver DVD-quality experiences that can be secure and portable (e.g. MPEG-4, Windows Media).
- The convergence of the consumer electronics (CE) and personal computer (PC) industry, with an emerging explosion of open, consumer media devices

- Patterns of distribution on the Internet that are disruptive, decentralized, and favor massive new economies of scale for any size Web site or content owner
It is likely that we are at a tipping point in the convergence of television and the Internet, where content can flow freely over the open Internet. The powerful and irreversible entrepreneurial energy that has built the Internet over the past decade will now direct its energy into a new generation of Internet TV entrepreneurs seeking to build the next big thing in global media. All this reinforces the points that we wrote about earlier - the consumer electronics industry must work more closely with the service provider industry.These are both vying for the consumer's dollar, but they will both lose out if issues of standardisation and obsolescence are not dealt with more quickly than they have been in the past. Broadband, Mobile's first cousin is really creating froth and action in the digital market. With new innovations like the Video iPods , it is clear that the entertainment industry shall never be the same again - it is set against a huge tumultous but exciting shift.

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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
"All views expressed are my personal views are not related in any way to my employer"