1. The media consumer goes digitaland remains connected Erik Dejonghe December 2010

2. Creation Aggregation Distribution Local Access Value chain of traditional media delivery Content aggregation has been the most powerful element in the delivery chain of Printed media (publishers) recorded music (record companies) radio & television (broadcasters), Film (movie companies). Content creation was in many cases integrated (or controlled) by aggregators. In the case of broadcasting, the aggregators being distributors at the same time. Power of consumer was limited to the choice of aggregated product.

3. Digitizing the delivery chain (1) Printed media: electronic delivery via the internet Mainly in support of printed delivery Generates additional cost, but also (some) additional advertising income (balance?) Accessible to non-subscribers of printed delivery Recorded Music: disruption of the Business Model ‘Hit single’ too cheap to generate profit promotion for album Album format under pressure from P2P delivery Music as a serviceis (still) booming Artists go/return to the stage …

4. Digitizing the delivery chain (2) Radio: digital delivery as single service failed Proliferation/integration FM-receivers prevents ASO of FM LT simulcasting DAB and FM: no sustainable BM Digital radio flourishes as side productof DTV, FM prevails DTV: adoption supported by technology and regulation Transport capacityx 4 - 8  broader choice, stable signal Increased competition between distributors Technological synergies between CE and ICTequipment Film (and television Series?) Conflict in value chain slows Electronic Cinema down DVD becomes main contributor for revenue P2P delivery picked up, forced shorter release windows

5. The traditional consumer of digital content Digital divide for media was lower than for ICT Skills: Complexity STB comparable to VCR; Internet browser has intuitive graphical user interface Attitude: No (or hardly) different content Access: Low price barrier Broader choice for viewing, listening/reading iPod started as Walkman with more capacity Newspaper website extended time/location for reading Free content via the internet became the (unwritten) rule Digital music became ‘free’ due to # uncorrelated factors(Open cd format’; MP3 coding; storage cost, BB speed …) Perception cannot be reversed, due to past ‘dubbing’

6. Changing the rituals, disrupting the business models (2000 onwards) Net books and media laptops Age of individual internet access down from 18 to 13 Adoption of wireless networks (2010: 80% of pc families) Adoption centralized storage/individual cloud storage Media enables smart phones Combine music, images, PIM, and mobile media access with speech and SMS Cloudsynchronizationover Wi-Fi replaces PC synchronization over usb Arrival of media ecosystems (Apple, Android, System 7 (?), CWM (?)

7. Changing the rituals, disrupting the business models (2000 onwards) “Full Quality” media/internet access via tablet devices Apple succeeded where Archos & UMPC failed (Apps concept, fast start-up & simple app switching) Tablet fills the gap between phone (fast reaction) and net book (slow start-up) Early ‘battle of the giants’ (Apple against Samsung) makes competition hesitant

8. The Connected Media Consumer re-inspirers DTV Why iDTV failed Shared screen (and sound!) does not match with OTT individual content access Video viewing distance >> information reading distance Data entry via wireless keyboards is not work in convenient in front of TV screen Why DTV puts pressure on (some) broadcasters Multichannel creates more competition for local channels Time shifting allows to view more than one ‘hit show’ during prime time Risk of Ad skipping (more in US than in Europe) TV content moves to other media

9. TV content moves to new media

10. From viewing/working/conversation devices to platforms Preserve the main screen for shared content Watching TV still implies sharing emotions in familiar surroundings Second choicemoves from secondary location to individual screen Metadata (teletext) move to RSS/ fast internet access mobile screen Preserve Individual screen for individualneeds Individual ‘catch-up’ needs more location flexibility laptop Media multitasking: ‘listen’ to news while ‘scanning e-mails’ laptop Media & work: ‘Follow’ sport event while doing ‘light’ administrative tasks laptop Use mobile screen (via Wi-Fi) for real-time metadata Individualized (slow) ‘channel mosaic’ on smartphone (tablet?) Interactive participation/conversation via applet connection with broadcaster We tolerate individualaddressing/tracingvia ‘walled garden connection’ if we receive individualizedinformationin exchange

11. Observations 2010(11?) DTV has widened the gap between ‘broadcast hits’ and ‘channel sub tops’ flexible viewing on individual screens can create important off-prime market DTV has shifted income balance from ‘passive’ channel advertising to service subscriptions  meaningful services related to television content can create more income for broadcasters and service providers (detrimental to printed media?) The ‘digitally connected media consumer’ will enjoy more flexibility in viewing time & location and will have more control over ‘quality of delivery’ (low resolution on individual screen, full resolution on main screen) and ‘quality of experience’ (advertising and delivery buffering on OTT television, preview access and interrupted viewing on premium channels) More choice will create a richer TV experience for the consumer community.