Inspired by the recent Emmy awards broadcast, and with a nod to the awesome Best Drama winner Breaking Bad, this month I take a look at the impact of technology innovation on the Media and Entertainment industry and what it will take for those companies to win the “IT Emmy.”
As consumers, we have all directly experienced the dramatic changes happening throughout the Media and Entertainment (M&E) industry. From music to television, books and movies, new and innovative technology has been a major, and at times quite disruptive, factor in reforming the industry’s business models. It is only karmic then that M&E companies are using technology in turn to create solutions that deal with the underlying changes in long established production practices and distribution approaches. As readers of my CMSWire series might anticipate, I see enterprise information management (EIM) technologies playing an important role in those solutions.
It’s been said that the larger lesson of Breaking Bad is that "actions have consequences.” To help me take a closer look at both the actions and the consequences for M&E, I’ve invited my colleague and industry expert, Charles Matheson, to answer some top of mind technology questions for publishers, broadcasters, movie studios and advertisers alike.
Deb Miller: Charles, the Media & Entertainment industry seems to be going through a real transformation driven in large part by technology innovations. Traditional business models have been turned upside down or, in some cases, simply ceased to exist. What segments of the M&E industry are suffering from technology disruption?
Charles Matheson: Business model disruption has been in effect for the past 15 years and the first segment of the M&E industry to feel the sting of technology disruption was the music industry in the early 2000’s. The emergence of digital music files or MP3’s that could be shared or sold blew up the decades-old business model of recording and distributing music. In a half decade the music industry saw billions of dollars evaporate from the business with devastating results. Just try to find a record store in your town. The other segments of M&E saw what happened to Music and determined that it wouldn't happen to them, so adoption of new information technology and an innovation imperative drives their strategic planning and decisions. Media companies across the board have decided it’s safer to ride the technology wave than it is to resist and get buried by it.
Deb Miller: Each segment of the M&E industry is different and will face different business pressures and innovation challenges. Are some segments handling this business transformation better than others?
Charles Matheson: Each segment has its challenges, but they are not in denial or resistant to change. The two segments of M&E that took the hardest hit early on were music and newspapers in the publishing segment. The advent of a ubiquitous free network caused major disruptions in key pieces of their respective business models. Music was freely, if illegally, distributed through services like Napster and news was aggregated through portals while classified advertising moved to specialized web sites like Craigslist.com. Advertising jumped on the new technology early on and perceived it, correctly, as a tremendous opportunity. Other segments like publishing, studios, broadcasters and game developers have changed their business models to adapt and prosper.
Deb Miller: How are the segments using technology to enable this business transformation?
Charles Matheson: One key enabler has been the adoption of business process management disciplines and technology starting at the inception of a project, book, show or advertisement. Modeling and mapping a business process, even one as iterative as film production or website development, has proven to deliver results. Cost savings and performance improvements through process and case management are obvious benefits, especially those focused on serving the customer. However, increasing revenue may be the real “gold statue” winner for BPM. For example, a BPM based application that helps manage Intellectual Property and licensing can have a tremendous impact.
Deb Miller: How are distribution models changing to meet the new business environment?
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