The media industry: In the vanguard of digital transformation
The media industry has already been transformed by several waves of digitalization. To thrive, media enterprises will have to keep technology at the heart of what they do, helping them create compelling content and reach new audiences.
Almost 20 years ago an influential essay entitled ‘Content is King’ was published. At a time when most people did not even have email accounts, it made some bold predictions, most notably that “content is where… much of the real money will be made on the Internet”. For the best part of two decades, its author, Bill Gates, has been proved spectacularly right.
But today the picture is more complicated. As we chart in our analysis of digital trends in the media sector, the industry has already been transformed by several waves of digitalization – file-sharing, streaming, social and mobile – driven by the impatience of consumers to access any content from anywhere in the world at any time. Social media, video-streaming services and smartphone apps compete continuously for our attention. With gigabytes of content being created every second, media companies are engaged in a tooth-and-claw battle for consumers’ attention.
In this hypercompetitive market, having great content is no longer enough. Media enterprises need to integrate their content into high-quality user experiences, with customized content, better viewing recommendations, more personalized and relevant adverts, and online tools to recreate those ‘office water-cooler’ conversations about the latest hit TV series.
For media organizations to create the right content and present it in the correct context will require innovation and digitization throughout the business, from discovering new methods of creating content (such as crowdsourcing) to experimenting with imaginative ways to distribute it (say, through connected retail apps).
Digital has become so important that the boundary between the media and technology industries has broken down. This has implications for both traditional media companies and digitally native startups.
To thrive, all these enterprises will need to keep technology at the heart of what they do, to help them reach younger audiences, create compelling content and services, and distribute and monetize their content more efficiently.
We have identified three digital themes – personalization and contextualization, content fragmentation, and partnerships and industrialization – that will define the evolution of the media industry over the next decade:
Building on our analysis of these three themes, we have drawn up a number of recommendations for business leaders that will help position their enterprise to thrive in an era of intense innovation. Developing a digital business is about speed and agility, so we have considered a number of tactical, shorter-term capabilities and investments. Our recommendations span the use of data, digital strategy, learning through failing faster and more cheaply, and updating legal and intellectual property frameworks for the digital age.
Media is one of six industries (along with automotive, consumer, electricity, healthcare, and logistics) that have been the focus of the World Economic Forum’s Digital Transformation of Industries (DTI) 2016 project. An overview of the DTI program can be found here.
Our in-depth findings about the digital transformation of the media and entertainment industries are available in a white paper, which can be downloaded here.
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