TheMediaIndustryattheDigitalCrossroadsArtificialIntelligencetotheRescue? ReneBuest

DirectorofTechnologyResearch

VDZTechSummit

November22,2017,Hamburg

ABOUTME.

ReneBuestDirectorofTechnologyResearch

• 7+YearsExperienceasTechnologyAnalyst• ResearchAreas

• CloudComputing• DigitalEnterprise• DigitalInfrastructure&Platforms

• FormerAnalystFirms• CrispResearch• NewAgeDisruption• Gigaom Research @ReneBuest

DIGITIZATIONIt’sanEvolution,Stupid!

THEDIGITALEVOLUTION– STEPBYSTEP.

+40Years

1971Intel4004:Firstmicroprocessorproducedinseries

1994Amazon

1998Google

2004Facebook

2010Pinterest

1985Windows1.0

2006AmazonWebServices

1990Internet

1950erDevelopmentElectronicComputer

1969Arpanet

1976Apple

1975Microsoft

2010WhatsApp

2014AmazonAlexa/Echo

2001Expedia

2008Spotify

2008Airbnb

2009Uber2003

Skype

1984Cisco

1972SAP

1999Salesforce

1977Oracle

2010Instagram

Cloudimpact

2011AppleSiri

2016GoogleAssistant

2007AppleiPhone

2007Netflix(onDemand)

2003Tesla

1997Netflix

2012GoogleNow

DIGITALENTERPRISEEVOLUTION.

DigitalEnterpriseEvolution

DigitalEnterprise1.0(1970- 2000)

DigitalEnterprise2.0(2001- 2015)

DigitalEnterprise3.0(2016- …)

• Mainframes• TerminalSystems• PersonalComputer• LocalAreaNetworks• Client-Server-Architecture• EnterpriseComputing• Software&Applications• Internet

• MobileComputing(Smartphones,Tablets)

• Cloud(IaaS,PaaS,SaaS)• Web-Centric-Architecture• Software-definedX(SDx)• InternetofThings(IoT)• APIEconomy• Interconnectionwith

Ecosystems• SocialMedia

• End-to-Endofferings(Devices+Services)

• SophisticatedInterconnectionbasedonIoT (People,Objects,Locationsandmore)

• Context-EconomybasedonData&Knowledge

• AI-definedWorld(Smart/IntelligentEnvironments)

THEMAGICTRIANGLE.

Digital

Cloud AI-driven

NextGenerationBusiness

• Scalability• Elasticity• GlobalReach• Localization• StateoftheArtTechnologies• FasterDeployments/Releases• CostEffective• […]

• BetterUnderstanding• FancyExperience• DeeperEngagement• Customized• Predictive• Conversational• Augmented• […]

CHALLENGESFORTHEESTABLISHEDECONOMY

PLATFORMCOMPANIESINVADETHECOMPETITIVESPACEOFESTABLISHEDCOMPANIESWITHTHEIRSTRONGCASHPOSITION.

THEPLATFORMCOMPANIES’CASHPOSITIONLotsofcashtoinvestwithnourgencytoprioritizebudgets.

THEESTABLISHEDCOMPANIES’CASHPOSITIONVerylittlecashtoinvest,highpressurethroughexternalstakeholders(capitalmarket,customersetc.).

total revenue

totalcost

Playmoney

marginexpectedby/returnedtomarket

cost of revenue

$

Playmoney

$

cost of revenue

PLATFORMCOMPANIESR&DSPENDINGSAREINCREDIBLE.

Source:DerSpiegel

PLATFORMCOMPANIESHIJACKTHEDIRECTRELATIONSHIPBETWEENTHEESTABLISHEDCOMPANIESANDTHEIRCUSTOMERS.

Customerschooseplatform

RETAIL

CUSTOMIZEDADVERTISING,

IN-/OUTBOUND

E-COMMERCE

Customerschoosegoodsandservices

fromplatform

Brandinfluencescustomerstobuytheirproducts/services

Brandoffers itsproducts /services onmultiplechannels

BRANDNO.1

BRANDNO.2

BRANDNO.3

Platformwillalwayssatisfythecustomerstokeepthemfrom

switching

INTHEPAST:DIRECTCUSTOMERRELATIONSHIP

TODAY:POINTOFSALEMOVESINTOTHEPLATFORM

Platform chooses goods/servicesfrom the brand based onthe

customers‘preferences

BRANDNO.1

BRANDNO.2

BRANDNO.3

CustomerschooseanAIassistantplatform!

How can Ihelp you?

Needsomething?

GENERALAIUNIVERSE– BIGINTERNETCOMPANIESBUILDTHEIROWNGENERALAI.

THE“HOTELCALIFORNIA-EFFECT”–Consumerscancheckoutanytimetheylike,butcanneverleave.

• BigInternetcompanieslikeAmazon,GoogleandFacebookcollectendlessamountsofdataandcreatetheirownGeneralAIs.

• Endconsumersgivetheirdata/knowledgetothecompaniesandinreturngetfreeaccesstoofferedservices.

• TheAIsfromthesecompaniesareusedtobuilddisruptiveordisintermediatingapproachesthatcannotbeusedbyenterpriseswhoarethreatenedbythesedisruptionsandintermediations.

• Servingconsumerswithfreeservices,gettingtheirdatainreturnandthedisruptiveapproachesareinterconnectedtocreatea“HotelCalifornia”effect.Consumerscan“check-outanytimetheylike,buttheycanneverleave.”

offer(partlyfree)servicestotheconsumers

Consumersgivedatabackinreturn

Build their ownGeneralAIsonthe consumers‘data.

GENERALAI

ESTABLISHEDCOMPANIESdonothaveaccesstotheseGeneralAIswithoutendangeringtheirveryexistence.

THEAI-ENABLEDENTERPRISE

AIISTHESTRONGESTTOOL.

Astrongbrand,outstandingservicesandinnovationaretheconditionsforsurvival.Butturningexponentialistheonlywaytosuccessfullycompeteagainstcompaniesthatarealreadyexponential.

PLATFORMCOMPANIESTHINKBIGPlatformsareexponentialandthinkbigregardingtheirtargetsforimprovement.Theychoosetostartdisruptingindustriesthattouchbillionssuchashealthcare,transportation,communications,energy,financeandtelecoms.

AIINTHECORPORATETOOLKITAIisoneofthetools– potentiallytheonlyone– inthecorporatetoolkittohelpovercomethesecompetitivethreatsANDmakeuseofthestrongsideofestablishedplayers:THEIREXPERIENCE.

WithAIanythingthatisaprocessinyourcompanytodaycanbeautomated.Onyourjourneytonewbusinessmodels,imaginewhatyoucantowiththefinancialresourcesandtalentsetfreewhentoday’sbusinessislargelyrunbyAI.

turningexponential

THEEND-TO-ENDPLANFORTHEAI-ENABLEDENTERPRISE.

D A TA

S T RA T E G Y

E X E C U T I ON

AI-enabledEnterprise

RETHINKSTRATEGYThinkaboutanew(exponential)businessmodel.

TOP-DOWNRETRAININGPrepareandtrainyourorganizationforanAI-enabledenterpriseandacceptinganewbusinessmodel.

PREDICTIVEANALYTICSUsedatafromthesemanticmaptoexpedite,improvebusinessprocessesandfuturebusinessevents.

SEMANTICMAPOFYOURDATAAcceptcontinuousdataflowasafoundationforfuturestrategy.

AUTONOMOUSITOPERATIONSAutomateIToperationtoreceiveimmediatevaluebroughtbyHIROTM andcollectdata.

EXPANDTOOTHERBUSINESSPROCESSESUsingknowledgeofcompanygatheredthoughITautomation,makemoreprocessesautonomous.

DATA-DRIVENPROCESSESUsedataandAItogenerateoutcomebasedprocesses.

1 2

34 5

6

7

ARTIFICIALINTELLIGENCE& THEMEDIAINDUSTRY

WHATCOULDTHEMEDIAINDUSTRYDO?

STOP PLAYINGTHEEYEBALLGAME

Simplifylanguagetosuitemoreandmorebasicemotionstogetmoreeyeballsintheshortrundidnotwork,didit?

• Companieswithmorereachhavemoreeyeballs• Companieswithmoreclientsknowtrendsbetter• Companieswithcentralized contentmanagement

canproducemoreindividualizedcontent

START PLAYINGTHEVALUEGAME

Optimizeyourplatformtoday,butplantogetpayedforsomethingyouknowbetterthanothers.

Today:• ImplementnarrowAIforrecommendations• Hookyourselfintoexistingstreamsandplatforms

tomakemoney• Createanunderstanding ofyourclientsandyour

clients’friendsinthecontextofyourmedium

Tomorrow:• Stopcreatingthesamething20timesinone

company• Insteadfocusoncreatingmoreindividualized and

bettertargetedPERSON-2-PERSON content• Sellvalue,noteyeballs(time,security,risk

awareness,…)

SUPPORTOURGOALS– AEUROPEANAPPROACH

FULLAUTONOMY:

WithourArtificialIntelligence(AI),establishedcompaniescanrunanyprocessautonomouslywhileretainingtheirknowledge andmonetizingtheirexperience.

AI DP

ADATA-POOLFORESTABLISHEDCOMPANIESWITHSTRICTDATAPROTECTIONUNDEREUROPEANLAW:

WeareworkingonaData-Pool whereestablishedcompanies’dataisorganizedsemanticallyandsharable.Dataremainsundertheirfullcontrolandownership,followingstrictEuropeandataprotectionprinciples.

DIGITALCORRELATIONEverythingIsDirectlyInterconnected.

DIGITALCORRELATION.

Digital

CloudComputing

DataAnalytics

Internetof

Things

FogComputing

ArtificialIntelligence

AugmentedReality

Blockchain

TemplateEconomy (3D Printer)

SDx

AutonomousLife

AdvancedPersonal

Assistants

Connectivitye.g. 5G

THANKYOU

GETINTOUCH.

ReneBuestDirectorofTechnologyResearch

arago GmbHEschersheimer Landstrasse 526- 53260433FrankfurtamMainE-Mail:rbuest@arago.coPhone:+496940568172Mobile:+4915114515020

@ReneBuest

CONTACT.

GETINTOUCHEurope&OtherRegions:arago GmbHEschersheimer Landstr.526-53260433FrankfurtamMainGermanyEmail:info@arago.co

NorthAmerica:arago Inc.41E11thStNewYork,NY10003USAEmail:info@arago.co

OTHERRESOURCESHIROTM StoryshowsdatafromrealHIROinstallationsacrossamultitudeofclientswithIToperationsasasampleset.SeeautomationratesbytechnologyorprocessandexaminehowHIROcombinesmanypossiblesolutionsoutoffewKis tosolvealargevarietyofproblems.

HIROTM Portalprovidesstatisticalinformationtomonitor,trackandanalyzeautomationactivities.Italsoprovidesresourcesforenterprisestoimprovetheirautomationrates.Furthermore,theportalallowsuserstomanageexistinglicensesandinstallationsaswellastocreatenewlicenses.

HIROTM CommunityiswhereKIscanbeshared,requestedandreviewedcollaborativelybylogged-inusersandArago’s experts.ItalsooffersanenterprisefunctionalitywhereKIsandKIbundlescanbesharedexclusivelywithinorganizations.

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