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Copyright  2014 Pearson Education, Inc
Copyright 2014 Pearson Education, Inc
Chapter 10
Chapter 10
YouTube and the Emerging Internet Broadcast System (IBS)
YouTube and the Emerging Internet Broadcast System (IBS)
Trends in Online Content, 20132014
Trends in Online Content, 20132014
Trends in Online Content (cont
Trends in Online Content (cont
Content Audience and Market
Content Audience and Market
Media Consumption
Media Consumption
Internet and Traditional Media
Internet and Traditional Media
Media Revenues by Channel
Media Revenues by Channel
Digital Content Delivery Models
Digital Content Delivery Models
Online Content Consumption 2012
Online Content Consumption 2012
Free or Fee
Free or Fee
Digital Rights Management (DRM)
Digital Rights Management (DRM)
Media Industry Structure
Media Industry Structure
Media Convergence
Media Convergence
Convergence and the Transformation of Content: Books
Convergence and the Transformation of Content: Books
Making a Profit with Online Content
Making a Profit with Online Content
Online Publishing Industry
Online Publishing Industry
Online Newspapers
Online Newspapers
Daily Unique Visitors at Online Newspapers
Daily Unique Visitors at Online Newspapers
Newspaper Business Models
Newspaper Business Models
Can Apps and Videos Save Newspapers
Can Apps and Videos Save Newspapers
Challenges: Disruptive Technologies
Challenges: Disruptive Technologies
E-books and Online Publishing
E-books and Online Publishing
New Digital Ecosystems
New Digital Ecosystems
Challenges of E-book Platform
Challenges of E-book Platform
E-book Sales
E-book Sales
Magazines Rebound
Magazines Rebound
Read All About It: Rival Digital Newsstands Fight
Read All About It: Rival Digital Newsstands Fight
Online Entertainment Industry
Online Entertainment Industry
Online Entertainment Industry
Online Entertainment Industry
Online Entertainment Audience Size
Online Entertainment Audience Size
Projected Growth in Online Entertainment
Projected Growth in Online Entertainment
Television and Premium Video
Television and Premium Video
Movies
Movies
Online Movie Business Share of Movie Revenues
Online Movie Business Share of Movie Revenues
Music
Music
Consumer Spending on Digital Music
Consumer Spending on Digital Music
Games
Games
Online Gaming Audience
Online Gaming Audience
Online Entertainment Industry Structure
Online Entertainment Industry Structure
Hollywood and the Internet: Lets Cut a Deal
Hollywood and the Internet: Lets Cut a Deal
Copyright  2014 Pearson Education, Inc
Copyright 2014 Pearson Education, Inc

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apple 2013

apple 2013.ppt
1 Copyright  2014 Pearson Education, Inc

Copyright 2014 Pearson Education, Inc

Publishing as Prentice Hall

2 Chapter 10

Chapter 10

Online Content and Media

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

3 YouTube and the Emerging Internet Broadcast System (IBS)

YouTube and the Emerging Internet Broadcast System (IBS)

What types of online videos have you watched online, and on what devices? What sites have given you the best overall viewing or entertainment experience, and why? What advantages does watching traditional television have over watching online TV and films?

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-3

4 Trends in Online Content, 20132014

Trends in Online Content, 20132014

Vertical integration: Distributors enter content production business Netflix transitions to TV show distribution The mobile platform accelerates the transition to digital content E-book sales grow rapidly Digital music sales top physical sales Console games stagnate as online, social, casual games soar

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-4

5 Trends in Online Content (cont

Trends in Online Content (cont

Four Internet titans compete for ownership of online content ecosystem: Apple, Google, Amazon, and Facebook YouTube launches 100 entertainment channels Internet content challenges cable TV for home viewing Revenues from online media are the fastest growing media revenues

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-5

6 Content Audience and Market

Content Audience and Market

Average American adult spends 4,500 hrs/yr consuming various media 2013 media revenues: $526 billion More than 77% of the hours spent consuming TV, radio, Internet Desktop and mobile use: 4.6 hrs/day Internet usage doesnt reduce TV viewing

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-6

7 Media Consumption

Media Consumption

Figure 10.1, Page 632

SOURCE: Based on data from eMarketer, Inc., 2013a, authors estimates

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-7

8 Internet and Traditional Media

Internet and Traditional Media

Cannibalization vs. complementarity Does time on Internet reduce time spent with other media? Books, newspapers, magazines, phone, radio Internet users Spend relatively less time with traditional media Consume more media of all types than non-Internet users Often multitask with media consumption Multimediareduces cannibalization impact for some visual, aural media

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-8

9 Media Revenues by Channel

Media Revenues by Channel

Figure 10.2, Page 634

SOURCE: Based on data from industry sources; authors estimates.

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-9

10 Digital Content Delivery Models

Digital Content Delivery Models

Online content delivery revenue models Subscription A la carte Advertising supported (free/freemium) Free content can drive users to paid content Users increasingly paying for high-quality, unique content

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-10

11 Online Content Consumption 2012

Online Content Consumption 2012

Figure 10.3 Page 650

SOURCE: Based on data from eMarketer, Inc., 2013b; industry sources; authors estimates.

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-11

12 Free or Fee

Free or Fee

Early years: Internet audience expected free content but willing to accept advertising Early content was low quality With advent of high-quality content, fee models successful iTunes 80 million buy from legal music sites YouTube cooperating with Hollywood production studios

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-12

13 Digital Rights Management (DRM)

Digital Rights Management (DRM)

DRM: Technical and legal means to protect digital content from unlimited reproduction and distribution Issue often cast as moral contest Telecommunications and device industries benefit from increased traffic 23% of global Internet traffic is stolen material

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-13

14 Media Industry Structure

Media Industry Structure

Three separate segments Print Movies Music Each dominated by few key players with little crossover Larger media ecosystem Millions of individuals, entrepreneurs Blogs, YouTube, independent music bands, and so on

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-14

15 Media Convergence

Media Convergence

Technological convergence Hybrid devices Content convergence Three aspects: Design, production, distribution New tools for digital editing and processing Industry convergence Merger of media enterprises into firms that create and cross-market content on different platforms

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-15

16 Convergence and the Transformation of Content: Books

Convergence and the Transformation of Content: Books

Figure 10.6, Page 641

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-16

17 Making a Profit with Online Content

Making a Profit with Online Content

25% users will pay for some content Four factors required to charge for online content Focused market Specialized content Sole source monopoly High perceived net value Portion of perceived customer value that can be attributed to fact that content is available on the Internet

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-17

18 Online Publishing Industry

Online Publishing Industry

$92 billion based originally in print, moving rapidly to Internet Three segments Online newspapers E-books Online magazines

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-18

19 Online Newspapers

Online Newspapers

Most troubled segment of publishing industry Failure to protect content from free distribution 60% have reduced staff However: Online readership growing at more than 10% Mobiles, e-readers, tablets provide new avenues More users willing to pay for premium content Aggregators are recognizing need for high-quality content to distribute and use for advertisements

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-19

20 Daily Unique Visitors at Online Newspapers

Daily Unique Visitors at Online Newspapers

Figure 10.8, Page 646

SOURCE: Based on data from Alliance for Audited Media, 20123

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-20

21 Newspaper Business Models

Newspaper Business Models

Initially fee-based, then free, and now beginning a return to fee-based Newspaper headlines are primary content on Google News, Yahoo News New York Times now charging for premium access Newspaper efforts to ally with Internet titans New reader devices with reader apps

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-21

22 Can Apps and Videos Save Newspapers

Can Apps and Videos Save Newspapers

Have you read a newspaper using an app? Have you paid for any online newspaper or article? How much would you pay for a single article? Would you prefer to watch online news videos produced by a TV station or by a newspaper such as the New York Times? What other opportunities could help the industry recover from the decline in print sales?

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-22

23 Challenges: Disruptive Technologies

Challenges: Disruptive Technologies

Newspapers: A classic case of disruptive technology? Industry still in flux Newspapers have significant assets: Content Readership Local advertising Audience (wealthier, older, better educated) Online audience will continue to grow in numbers and sophistication

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-23

24 E-books and Online Publishing

E-books and Online Publishing

E-book sales have exploded in recent years$5.8 billion in 2013 30% of all consumer book sales New channel for self-publishing authors Amanda Hockings My Blood Approves (2010) Evolution Project Gutenberg (1970s) Voyagers books on CD (1990s) Adobes PDF format

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-24

25 New Digital Ecosystems

New Digital Ecosystems

E-book hardware, software, combined with online megastores Amazon Kindle: Linked to Amazon store and cloud storage Apple iPad: Multipurpose tablet, linked to Apple stores Authors able to bypass traditional agent, publisher channels DRM more effective for e-books than music industry

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-25

26 Challenges of E-book Platform

Challenges of E-book Platform

Cannibalization Fewer physical sales More e-book sales, more purchases of readers Book publishing revenues same in 2012 and 2011 Finding the right business model Wholesale model Retailers pay wholesale price and establish retail price Agency model Distributor as agent must charge publishers retail price Converging technologies Interactive books, iBook Author, iBook Textbooks

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-26

27 E-book Sales

E-book Sales

Figure 10.9, Page 651

SOURCE: Based on data from eMarketer, 2012b.

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-27

28 Magazines Rebound

Magazines Rebound

Magazine circulation plummets 19802012 From 22 million in 2001 to 10 million in 2012 Special interest magazine sales remained stable Magazines are making up for loss in print readership One-third of U.S. Internet users read online magazines 35% of tablet users Apples iPad subscription service Popular Web sites (Pinterest, Facebook) drive traffic to online magazines Social reader apps Magazine aggregators

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-28

29 Read All About It: Rival Digital Newsstands Fight

Read All About It: Rival Digital Newsstands Fight

What advantages and disadvantages do digital newsstands offer to publishers? Do you use an app or digital newsstand to read magazines? Which ones? How does the experience of reading a magazine on a tablet or smartphone compare to reading a physical magazine?

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-29

30 Online Entertainment Industry

Online Entertainment Industry

Four traditional players, one newcomer Television Radio broadcasting Hollywood films Music Games (new arrival)

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-30

31 Online Entertainment Industry

Online Entertainment Industry

Internet is transforming industry: Platform development: Smartphones, tablets, music platform Online streaming and cloud storage Social networks as distributors Viable business models Music subscription services Closed platforms that eliminate need for DRM Widespread growth of broadband

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-31

32 Online Entertainment Audience Size

Online Entertainment Audience Size

Online traditional entertainment Online video has largest audiences, followed by music, games User-generated content: Substitutes for and complements traditional commercial entertainment Two dimensions: User focus User control Sites that offer high levels of both will grow

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-32

33 Projected Growth in Online Entertainment

Projected Growth in Online Entertainment

Figure 10.11, Page 662

SOURCES: Based on data from industry sources; authors estimates.

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-33

34 Television and Premium Video

Television and Premium Video

Television: Largest provider of high-demand content TV industry transitioning to new Internet delivery platforms Expansion of broadband networks New mobile platforms and cloud servers OTT: Over-the-top (Internet) delivery Impact on cable TV industry Social network influences Hulu: Joint venture of industry players

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-34

35 Movies

Movies

Difficult transition from DVD-reliance to streaming distribution to PCs and mobile devices More Americans bought online movies than DVDs in 2013 Many alliances and competing interests between distributors and creators Piracy, cyberlockers Two types of online movie sales Internet video on demand (iVOD) Electronic sell-through

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-35

36 Online Movie Business Share of Movie Revenues

Online Movie Business Share of Movie Revenues

Figure 10.14, page 669

SOURCES: Based on data from NPD Group, 2013a; industry sources.

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-36

37 Music

Music

Most changed of content industries Move from physical to digital product Unbundling of single songs Distributor market dominated by Apple Digital revenues account for more than half of all revenues Two types of digital music services Digital download90% of digital music revenue Streaming subscription servicesfastest growing

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-37

38 Consumer Spending on Digital Music

Consumer Spending on Digital Music

Figure 10.15, page 674

SOURCES: Based on data from the Recording Industry Association, 2013, eMarketer, Inc., 2012e.

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-38

39 Games

Games

Online gaming has had explosive growth Types of online gamers Casual Social Mobilefastest growing market Console Business models in flux Most online/mobile games offered for free

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-39

40 Online Gaming Audience

Online Gaming Audience

Figure 10.16, page 675

SOURCE: Based on data from eMarketer, Inc., 2013b

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-40

41 Online Entertainment Industry Structure

Online Entertainment Industry Structure

Inefficient, fractured: Many players and forces shape industry Reorganization of value chain needed for aggressive move to Web Possible alternative models Content owner direct model Internet aggregator model Internet innovator model

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-41

42 Hollywood and the Internet: Lets Cut a Deal

Hollywood and the Internet: Lets Cut a Deal

What challenges has the Internet posed to traditional Hollywood movie distribution? What is the biggest challenge? Can Internet distribution work with the release window strategy? Do you think Hollywood is doing a better job of protecting its content than the music industry? What is the most realistic and profitable path forward for the Hollywood film industry?

Copyright 2014 Pearson Education, Inc. Publishing as Prentice Hall

Slide 10-42

43 Copyright  2014 Pearson Education, Inc

Copyright 2014 Pearson Education, Inc

Publishing as Prentice Hall

Slide 10-43

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