Overview of Media Business Unit-1
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Key issues media business facing todayMedia is going through a time of huge transformation. Not just from a media agency point of view, but
across all parts of the value chain, from the media owners to the agencies and ultimately the marketers
and advertisers.
These changes are being driven by technology and associated social change, where media channels are
becoming more fragmented and the media consumer is more empowered than ever before. Some are
even becoming media in their own right through blogging and social media.
The industry continues to face the challenges and issues driven by technology, the economy and the
increased complexity of the category.
Just to name a few:
Declining sales of newspapers
Low circulation and advertising revenues
Digital transformation challenges
Increasingly fast past environment of social media
Audience Measurement methodologies & standardization of individual & multi-media channel
planning
Audience measurement measures how many people are in an audience, usually in relation to radio listenership and television viewership, but also in relation to newspaper and magazine readership and, increasingly, web traffic on websites. Sometimes, the term is used as pertaining to practices which help broadcasters and advertisers determine who is listening rather than just how many people are listening.
Tracking ROI & attribution across media channels proving effectiveness of media campaign activity
ROI defines Return on investments
In every industry, collecting metrics that indicate the return on investment for a particular business
event, campaign or strategy is essential to the success of your operations. Doing so informs you
whether what your company is getting the intended results, and can allow for a quick course change if
the numbers start to move in the wrong direction.
Return on investment, called ROI, is the incremental gain from a business operation divided by its
cost. It measures the efficiency with which business is using its available resources. It’s a key metric
for public companies with shareholders to satisfy, but even if you’re a small business or sole
proprietorship it is a key way to tell what’s working and what isn’t.
Recruitment & retention - finding, training & retaining quality, relevant people
Recruitment and retention are two human resources functions that require strategic thought and
planning. Talent management--an area of human resources which includes recruitment and
retention--is extremely important to your organization's growth.
Recruiting Qualified ApplicantsRetaining Talented Employees
Keeping up to date with constantly evolving market trends, initiatives & opportunities Keeping up to date is necessary to
Stay relevant
Communicate
Staying organized
Staying in touch
Business costs of continually evolving marketing technology & media research
Managing an increasingly diverse & siloed agency roster
Fragmenting market & increased competition from other media & channels ie social, owned &
earned media
Procurement & agency margins - finding an effective & sustainable business model
Disconnect & miss-communication between client, agency & media
Limited scope for outside the square & new opportunities
Some of the stated solutions are:
Multi-channel automated buying platform to streamline & simplify media trading process
Multi-channel planning & campaign measurement platform highlighting campaign results &
channel/media attribution
Ongoing training, talent pool development & accreditation for required evolving skillsets
Industry-wide structural change surrounding payment & agency remuneration models
Transparency surrounding agency revenue streams & publisher/media rebates
Consolidation of various media & advertising functions i.e. media and creative agencies merging
Developing in-house capabilities - bringing media & advertising decisions in-house
Amalgamation & alliances across key areas such as research & data collection
Industry driven regulation surrounding data ownership & consumer privacy
Incentives for innovation & first to market opportunities
Key Trends and Themes for Growth
Cost structures for content need to be significantly reduced
Consumer time and spending are shifting to digital, but media companies’ ability to monetize consumer engagement in the digital arena is well below what it is in analog media. As a result, media companies need to fundamentally reduce the cost of their content. Key levers include introducing more variable cost by maintaining fewer staff editors and content producers and instead managing networks of external contributors; developing greater scale and consistency in approaches to content production and technology; and attacking fixed costs through centralization, outsourcing, offshoring, and portfolio rationalization.
Advertisers are demanding more accountability, relevance and interactivity
Spending on traditional paid media is coming under growing pressure as advertisers devote more resources to digital, database marketing, event marketing, place-based media and even loyalty programs. This shift requires media companies to increase their focus on innovation and ROI as they craft advertising solutions. It is also creating opportunities to build new businesses around lead generation, custom media, and marketing services.
Technology shifts are affecting the value of content and distribution
Consumers are no longer satisfied just to enjoy print, video, or other forms of entertainment and information passively. In today’s search-driven world, consumers are actively looking for control, community, and interactivity. Ad-supported media companies, therefore, need to develop a robust digital toolkit to build premium inventory, whether in targeted and tagged site areas, interest-specific e-newsletters, or registration-required applications. The goal for media companies: move from creating impressions to building relationships with consumers, both directly and on behalf of marketers. New strategies combining content and applications can offer significant value to media and entertainment companies across both traditional and digital media. For example, companies can use relationship marketing strategies to drive consumers to stores, theaters, and other screens as well as to activate other desirable actions.
Online video, social media and mobile media are expanding rapidly
Media and entertainment companies need to ensure they participate actively in the growth platforms of the future. Making this happen will require mastering a new set of skills and strategies involving portfolio and business development, software, and technology. Creating a successful culture of innovation will also be a key element of the path forward. For many media companies, this will require greater openness in innovation processes, and the need to embrace more systematic “test and learn” approaches — trying many things, but scaling up only those that work.
Positions in emerging markets have become key to long-term growth
Global media and entertainment industry growth will be fed primarily from the emerging markets of Latin America, Asia, Russia and the Middle East. Across these regions, the multimedia landscape is developing rapidly; and, in many cases, traditional barriers associated with distribution and regulation are no longer that significant. Companies looking for growth need to be evaluating partnerships and acquisitions that result in a greater exposure to these geographies.
Industry Size
DigitizationSince the advent of the internet in the 90s, media companies have fought to
develop the capabilities to create, manage, sell and distribute digital content.
Modern media companies must examine the business 'ecosystems' they serve and the business models they use to adapt and lead in this digital environment. Understanding the needs of customers, for content and for the means to purchase and distribute it, is a start.
However, to be digital leaders in media, companies must understand the entire 'ecosystem' they are serving. They must also identify all interactions between ecosystem participants to learn how their content and accompanying sales and distribution processes give customers value. Only then can the business models from the analog world be updated to anticipate the digital universe that is evolving every day.
Some media segments have yet to shake off their analog legacies to find new profit models (for example newspapers); others have abandoned the models based on their analog roots to create new revenue and profit models. The paper looks at how digitization has affected media, by sub-segment:
Newspapers and Magazines
Book Publishing
Broadcast and Cable TV
Film
Advertising
Radio
Music and Music Services
Information Services
Gaming
New Entrants into Media
Areas to consider
Digitization of press
Digitization of Television
Digitization of Cinema
Digitization of Radio
Digitization of Recorded Music
PIRACY
Piracy has become more of a problem in the past decade than it ever has before, specifically movie piracy.
“Piracy is not a victimless crime,” and this is completely true. Piracy is extremely harmful to the movie industry and its effects are larger than anyone could imagine.
There are many different ways that people pirate movies. One of the most classic ways people pirate is by “leaking” them. This involves a person going into a movie theater with a camera or a phone and recording the movie as it plays. It is usually a poor quality, but many people still download these recordings anyways instead of going to see it in a theater.
Sometimes these leaks occur before the movie is even premiered, often because it is filmed during a special premier before the opening night. This is referred to as a pre-release, and they tend to result in a 19% decrease in how much the movie makes at the Box Office
. The Motion Picture Association of America looked into this belief and discovered that piracy costs around $20.5 billionannually in the United States alone (Plumer, 2). In fact, a study back in 2005 estimated that a 10% decrease in worldwide piracy, including both film and music, over the course of four years would add 1.5 million jobs, $64 billion in taxes and $400 billion in economic growth
The loss of money affects more than just the filmmakers and studios, however. It helps the entire economy grow due to tax and job increase. Pirating less films will mean that the studios will get more money, which leads to more movies, which employs people like hairdressers, electricians, actors, costume designers and countless other occupations. This will add more jobs to the United States and will also add more tax money to help the country.
Pirating is stealing intellectual property
A way for movie theaters to prevent piracy is to change their types of projectors.
by projecting an infrared spectrum over the projected film. This infrared image was not visible to the audience, but it would make the video on the camera someone brought into film the movie into a very low quality that would make the video almost unbearable to watch
TELEVISION
Pirated television isn’t what you find on street corners as illegally distributed box sets of your favorite show, although that is a small part of the problem. The most common form of pirated television comes from the reposting of streaming copies of episodes on free or paid sites.
The television industry is dependent on raising money by selling advertising slots priced to match viewing rates. When a show is pirated, the commercials are typically edited out and the reporting for viewing drops.
This means a direct loss of advertising dollars to the television companies. This loss of money then impacts the ability and willingness of television studios to invest in new shows.
Television piracy is so effective and pervasive because it is next to impossible to code a show so that it cannot be recorded off a television. Consumers have shown that they have a willingness to watch pirated material that was recorded simply by placing a camera in front of a set, flicker and all.
MUSIC