Macrotrend # 2: Entertainment will increase dependence on unconventional revenue sources created by technology innovation
As entertainment becomes medium agnostic, i.e. the same content gets re-cycled over multiple mediums like film, television, video, gaming, ringtones, events, merchandise, V-O-D etc., conventional revenue sources would diminish and give way to new revenue sources (propelled by technology innovation)
Examples -
Today’s music is increasingly becoming dependent on I-tunes downloads (new revenue source) rather than CD sales (conventional revenue source).
“Today, home entertainment is shrinking, box office is flat, the TV audience is splintered, and significant internet money remains hypothetical. Video game revenue, meanwhile, shot up 34 percent last year and has increased 49 percent so far in 2008” says Graham Hooper, head of Disney consumer products.
When it comes to the preferred mode of listening music, mobile phones are a close no.2 at 25% compared to 28% of mp3 players. On the subject of downloading music, nearly 70% of all kids (<14 years old) use Bluetooth / MMS to exchange music while the older youth (15-24 years) prefer to download from the net to the computer and then transfer to their phones.(Source: Synovate Young Asians Study 2007 for MSN)
Implications –
1. When in the business of entertainment, it is critical to start engaging new technologies ahead of the curve and the market
2. When thinking of an entertainment strategy for your brand, ensure that you experiment boldly with future “star” apps along with your evergreen and conventional distribution channels
I agree. But I would go a step further and say entertainment and technology would become one entity. The way I see it - creative creates entertainment and technology packages it.
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