The Future of Digital Entertainment
(Article as published in march 2007 issue of marketing magazine www.marketing mag.com.au)
The penetration of broadband and the sophistication of the end-user means that the Internet is no longer seen merely as an information gathering point and purchase space. Today it is as much an entertainment hub and is part of the digital revolution changing the face of entertainment. We look at current trends and initiatives in digital entertainment; how the lounge room/online entertainment space of tomorrow will look and impact on the future of digital entertainment. We also look at the culture of consumer behavior and how the industry will be able to deliver what the consumer wants now and in the future.
CONVERGENCE CULTURE
In his book ‘Convergence Culture’ Henry Jenkins, Professor of Media Studies at M IT talks of the new ways our media and culture works. Suggesting that
“We live in a world where every brand, every message, every sound and every image is spread across every media channel either legally or illegally”.
On the one hand this spread is shaped by boardroom decisions as companies try to maximize the spread of their brand messages by ensuring every franchise plays across the overall vision of the company, while media companies try to maximize ownership of multi media channels.
It is also spread by the consumer who want the media they want; how they want it, when they want it and in the forms they want it; and if companies don’t make it available to them legally, they will take it illegally.
In tandem with this culture convergence has been the birth of web 2.0, a second generation of internet-based services such as social networking sites, blogs, wiki’s, and social communication tools — that have led people to collaborate and share information online in ways previously unavailable.
THE ALL POWERFUL CONSUMER
We now live in a world where the consumer is constantly scanning the media environment looking for media properties they care about and companies have lost control.
The consumer can do anything they want with your brand, your advertisement your entertainment content. “They can mix it, mash it up, mod it, remix it, spread it through the internet, put it on You Tube and download it through bit torrent and there is very little you as a company can do about it “.
What is exciting right now is the degree to which companies are beginning to realize the power these participatory audiences exert through what Jenkins calls ‘A world of collective intelligence’.
Henry Jenkins talks in terms of companies shifting away from an old prohibitionist model which says, “don’t touch my intellectual property it’s mine to control” to a more collaborationist model which actively seeks to engage the consumer by giving up this control and allowing consumers to generate their own content on the platform provided and it is this thinking that is at the heart of web 2.0 and the transformation that is taking place in our media today.
In his book “Lovemarks-The future beyond brands” Kevin Roberts Saatchi worldwide CEO talks about the notion of ‘Inspirational Consumers’ who not only deeply care about brands and products but also will go out of their way to advocate, publicize and say ‘this product is worth paying attention to’. It is this group Jenkins argues companies had better listen to and find ways to engage.
The consumer in this context has a very powerful role to play so if a blogger finds out some information damaging to a company they can spread this very quickly and what was a brand community one minute can turn out to be your harshest critic the next.
This collective power prompted Time magazine to name its 2006 person of the year as “You” not one powerful person but to the collective you meaning your average Joe and the rest of us public. The editors see the dawning of a new era as “the small contributions of millions of people” result in You “seizing the reigns of global media…founding and framing the new digital democracy”.
THE GROWTH OF USER GENERATED CONTENT
It is the notion of consumer behavior coupled with the changes in technology that has led to the new area of user-generated digital entertainment being born. The growth of digital video over the last year has been nothing short of phenomenal, culminating with acquisition of My Space and You Tube by News Corp and Google respectively.
Inevitably the flood of creativity on line from sites like You Tube, My Space, Google video, www.revver.com, www.breaker.com, www.lulu.TV, and www.blipTV.com has led to the interest of Hollywood, TV Producers and advertisers.
US TV station NBC For example, has ordered TV scripts of two of You Tube’s video hits that attract over one million views each: ‘Nobody's Watching’ and the weekly wranglings of video pod cast, ‘Ask a Ninja’, starring two would-be actors sporting ski masks.
‘The Diet Coke and Mento’s Experiment‘, highlights the combustible effects of mixing the two together and resulting explosion in the fashion of a synchronized fountain. With over 5 million hits on US website www.revver.com which pays for its content has earned its creators over US $30,000, and an NBC show case on ‘Late Night with Letterman’.
A recent survey by the Pew Internet and American Life Project found that 40% of Internet users have posted content online and that user-generated content is mostly driven by the under 30’s. Within this age group it was noted that 62 % viewed content generated by someone they knew.
It is argued that online platforms hosting user-generated content have already amassed audiences exceeding those for some traditional media platforms. Clearly a new critical mass has been born.
THE SCRAMBLE TO MAKE MEDIA CONTENT AVAILABLE
This transformation has led to media companies scrambling to make their media content available across a variety of platform devices, anxious to avoid a similar recurrence as suffered by the music industry. This is seen as the key to modernizing many media companies and how they make their content available against the growth of user-generated content.
Last year in the US the Walt Disney Co. which also owns ABC television group made its first foray into making it content available online in a groundbreaking deal with I-Tunes that made “Desperate Housewives”,” Lost “and other Disney channel programs available online for the first time legally.
In conjunction with the I-Tunes deal they also developed their own online media player and during the ABC test they had 5.7 million streams of episodes. Far more people watched than the number of streams .In contrast during the same period Disney channel had 37 million streams, which speaks volumes about Kids and technology.
Newly formed company ‘Click Star’ www.cstar.com, a joint venture between Intel and Morgan Freeman’s Revelation Entertainment, is being positioned as the show case for internet video and Intel’s new ‘Viiv’ Platform. As well as a Danny Devito’s ‘Jersey’ documentary channel there will also be a movie channel hosted by film director Peter Bogdanovich that will provide old and new movies shortly after release.
THE BATTLE FOR THE LIVING ROOM
At the moment it is still too difficult and complex for the average person to take content from their PC and transfer it around the various devices in the home but all that is set to change as we see advances in home networking.
Currently standing in the way are compatibility issues highlighted in the battle for dominance taking place around file formats for digital video and how it will be protected. On the one side we have Apple’s rights protected ‘Fairplay’ system and on the other Microsoft’s windows media DRM. While I-Tunes has become the dominant player of legal music and video downloads, many media and executives prefer Windows DRM and Windows will be supported by a wide variety of platform manufacturers.
This year sees the battle to make the PC the entertainment hub of the home Intensify with the launch of its new ‘Vista’ operating system. Designed to upgrade The Media Centre Edition (MCE) of the XP windows operating system,’ Vista’ is specifically designed to transform the PC into a living room entertainment device. Instead of the normal windows user interface (UI), it provides a UI specially designed for operation at “ten feet’ in ‘sit back’ mode to control TV viewing on the computer as well as the functions of recording and DVD, Video, and music playback and photo viewing.
There are now many manufacturers of MCE based computers and increasingly they are designed to resemble consumer electronic devices rather than computers so they appear more acceptable in the living room environment.
Apple computers has its own version of the MCE for Macintosh computers which it calls ‘Front Row’ and Hewlett Packard last year debuted its successful Widescreen ‘Media Smart TV’ both of which sync to its own home network.
The huge growth in video that enters the home through the Internet will be displayed on your TV as well as your PC. The cable networks in the US have also been quick to get in on the action with AOL launching its own ‘ten feet’ experience, ‘AOL Hi- Q’ went online late last year and allows consumer DVD quality video on line.
Most recently Apple along with its groundbreaking I-Phone has launched its ‘I-TV “set top box that will sync TV sets to its I-Tunes portal which means any of the videos, music or films now available through the I-Tunes will play on your TV.
The development of game consoles also represents another viable means of digital entertainment for the living room with Sony Playstation 3 and Microsoft's X Box 360 both connecting to the internet and being marketed as home entertainment hubs to pipe movies, TV programming and music in addition to games. Incorporated into both new players is a HD DVD drive that is being touted as the next generation format, which provides six times the resolution of a standard DVD.
Either way you look at it ‘the battle for the living room’ is showing no signs of abating and it’s anyone’s guess how things will pan out. One thing is certain: we are still a long way from the one black box which will pipe all our entertainment; however with advances in technology you will see hardware become more robust, more powerful and more affordable at every level.
THE EVOLUTION OF ONLINE GAMING & VIRTUAL REALITY
When Tiger Woods showed up at a EA Games campus recently to view the latest installment in the Tiger Woods PGA Tour“ video game his initial reaction wasn’t quite what its designers were expecting. The golf great grew a little impatient upon viewing TV images of his swing and asked when he could see the game. After a pause the designers said this was the game and that he was looking at computer graphics.
Right now, computer generated animation for films, games and virtual reality (VR) only go 95% of the way there but with enormous advances in video processing technology it is only a matter of time until that last 5% achieves photo realistic rendering.
Imagine in virtual reality being able to put your own face on your avatar or player in your favorite online game, complete with facial expressions. Where else can you cross a reality TV show, My Space, a Personalized website and day-to-day life? Using an avatar, Second life (SL) www.secondlife.com lets users travel through a virtual world and interact and share experiences with other users.80’s pop act Duran Duran and Suzanne Vega have done virtual concerts in Second Life and interacted with fans in unimaginable ways. Such has been the hype over SL in the last six months that companies are literally falling over themselves to use it as a platform to promote their products and services and interact with gamers.
NBC new movie ‘Smoking Aces’ For example challenges gamers to become Second Life’s ultimate hired assassin to win their share of one million dollars by visiting the Nomad Hotel in Second Life® to pick up game instructions, a hit list, and weaponry. www.virtualnbc.com
With My Space losing its cool factor amid privacy issues it will be interesting to see how VR sites like SL and MTV’s newly launched Virtual Laguna Beach www.vlb.mtv.com will continue to attract an ever growing audience. There is no reason why we won’t be able to work in VR in the future. As the slogan for SL reads “your world your imagination”.
THE DIGITAL SHOW DOWN
Striking the balance between owning intellectual property and giving consumers control is key to the debate over copyright. There are two main camps both with widely divergent views.
On the one hand we have the traditional media companies and hard ware/software companies who believe information is a commodity that can be bought and its distribution controlled. On the other side are the computer companies like Google, IBM and most consumers who believe that information, by its nature should be free and its distribution uncontrolled.
Kevin Kelly's ‘New Rules for the New Economy” explains how traditional business models have been transformed by the Internet. Originally wealth was based upon physical objects and value came from scarcity. In the new information age value comes from abundance. The more people who have access to information the more valuable that Information is.
Rob Metcalfe the inventor of the Ethernet networking standard explains it very well in what became known as Metcalfe’s Law –“The utility of a network expands by the square of the number of users”. The more people on the network the more conversations are possible. Those who want to restrict the flow of information think of information as little atoms rather than as part of a great network.
The Economics of abundance’ is also the premise behind Chris Andersons “The Long Tail’ which demonstrates that endless choice is creating unlimited demand for niche products and services previously unavailable. The furor currently surrounding You Tube is a classic example. Numerous companies are engaged with litigation for copyright infringements and requesting their content be removed from the site. Little surprise Google set aside a considerable legal contingency fund upon its acquisition of YouTube.
These people claim to be in the content-delivery business but they do not understand the nature of information. There is a very good reason YouTube in the space of 18 months has grown from nothing to be sold for 1.65 Billion US dollars because of ‘the free flow of information’.
DRM is another example which restricts the way information can be used in software or hardware Advocates of this technology say that it is necessary to protect the rights of artists and publishers but all the signs point to the inevitable demise of copyright. A website www.defectivebydesign.org goes one step further in the campaign against the control of information. It is a grassroots movement against the absurdity of DRM targeting manufacturers. It argues DRM products have built in features that restrict what job they can do. These products have been intentionally crippled by the user’s perspective, and are therefore defective by design. ‘The digital freedom movement’ www.digitalfreedom.org also advocates ‘the free flow of information’ is essential to the creativity and innovation in our modern digital world to allowing new technologies the freedom to flourish.
MOVING TOWARDS A NEW MEDIA MODEL
Moving towards a new media model the combination of Google’s search savvy and You Tube’s handle on Internet video yields the first viable new media successor to broadcast and cable TV. The union offers the interactive infrastructure and tools needed to manage and monetize web-based digital video unmatched by traditional media platforms. What it means is that the Ad dollars and creative content that have sustained traditional media will increasingly shift to interactive platforms that can give consumers and advertisers more of what they want on interchangeable screens.
The 6.2 million daily visitors to You Tube are ripe for Google’s advertising savvy technology, which gives immediate open access to most commercial and user generated content. It reflects the demands of a young audience that will broaden as it matures.
Clearly the emerging standard for video and information is on-demand interactivity, being able to download and store content across any platform or device. The search engine is the means to manage this content; one cannot exist without the other. Add to this the ability to charge consumers and advertisers and you have a ready made new media model. Google can perfect ways of making money from content online by connecting the right-targeted consumers, advertisers, content producers, platforms and devices.
There is no reason why media companies cannot readily adopt this type of model by simply giving up control of copyrighted works and making content available for free that generates revenue from advertising. A few sites like US website www.brightcove.com already do this with video content and syndicate content to other sites with all parties receiving a share of revenue.
THE FUTURE OF DIGITAL ENTERTAINMENT
By 2010 it is predicted all TV will be digital, your computer will be able to speak to a whole host of portable and lounge room devices, even sing to us. Broadband penetration will be 75% of all households and 50% of all advertising will be on line.
Henry Jenkins talks of us being in an apprenticeship phase now where we are still learning to use the new consumer power at our disposal in an age of convergence. If we fast track five years we will have learnt to harness this power and these skills will have spread from niche fan-based communities to general consumers.
As demand for content soars, more consumers are seeking out information in online communities and engaging in media content in new ways. We will no longer be watching scheduled prime time shows; we will be subscribing to TV programs in the same way we subscribe to a magazine.
The opportunity for niche programming via an Internet based model will be significantly increased as those shows with a niche dedicated market and audience will be able to support and fully fund the show.
In his book ‘The Long Tail’ Chris Anderson demonstrates the renaissance being enjoyed by back catalogue film, book and music titles and that this can be also applied to other industries.
He cites the example of US subscription music website Rhapsody being able to sell each of its 1 million music titles at least once a month; and out of its total sales 40% of titles were previously unavailable. Likewise Amazon has done for books what Rhapsody had done for music and accounts for 20% of all book sales in the US. This, has been coined the “long tail effect”. www.thelongtail.com
Henry Jenkins says that in the future there will be more examples of transmedia storytelling techniques, like ‘The Matrix’. That is, where stories are made up of a complex world with multiple characters, which in turn support multiple platforms. The Matrix was made up of a Movie trilogy, a series of comics, an animated feature and a video game which all interact together to make up a whole.
Right now it is only really children’s content like Pokemon have this integrated story-telling technique but we will reach the point where the West Wings of the future will be fully integrated across multiple TV shows and multiple web platforms.
The notion of a quality drama will be one that allows the viewer go as deep as s/he likes and have as much complexity as s/he wants with an online community based around it, actively deciphering the pieces.
Interactivity will therefore become a more important part of the TV viewing experience which means more reality TV programs, a concept driven more by the opportunity to participate in the decision making process. The element of success for any platform is putting consumers in control so they can watch what they want where they want and when they want that will be reality in 10 years time.
Thomas Freidman’s best selling book ‘The World is Flat’ talks of a world where the power of the internet makes it possible for individuals to collaborate and compete globally. He tells us that by 2020 the free flow of information will completely blur national boundaries. These will be replaced by corporation-based cultural groupings and reconfigured human organizations tied together by global networks. Maybe this isn’t so far from the truth.
ACKNOWLEDEGEMENTS
’New Rules for the new Economy’ -Kevin Kelly -1999
‘Lovemarks’-The Future beyond Brands “Kevin Roberts, Powerhouse Books 2005 www.lovemarks.com
‘Convergence Culture: Where old and new media collide-‘Henry Jenkins 2006 New York University Press
Blog www.henryjenkins.org
‘The Future of Entertainment’-special The Hollywood Reporter September 26 2006
‘Broadband Delivery of Film and TV content over the open Internet: A technical discussion of the technical issues and Hurdles-The British Screen Advisory Council Briefing Paper: Ben Keen 2006
’What is web 2.0’- Tim O’Reilly-30/9/2005 O'Reilly web resources www.oreilly.com
‘Pew Internet and American Life Project’-The Future of the Internet-24th Sept 2006 www.pewinternet.org
Goog deal shifts paradigm on demand”-Hollywood Reporter article October 17 2006
Madison & Vine’-Scott Donation McGraw Hill 2004
The Coming digital showdown’-Graeme Philipson SMH article October 17 2006
The World is Flat-Thomas Freidman-Farrar, Straus and Giroux 2005
The Long Tail’-Chris Anderson-Random House Business Books 2006
“Idea City-New Thinking about marketing advertising and culture” –Joel Greenberg - http://blog.ideacity.com/
Tuesday, February 6, 2007
Sunday, December 3, 2006
Digital Entertainment -An Online Strategy
INTRODUCTION
The penetration of broadband and the sophistication of the end-user means that the Internet is no longer seen merely as an information gathering point and purchase space.
Today it is as much an entertainment hub and is part of the digital revolution changing the face of entertainment. This document outlines trends in digital entertainment and current initiatives; how the lounge room/online entertainment space of tomorrow will look and impact on the future of digital entertainment. It further examines the culture of consumer behavior and how we can deliver an online strategy in line with what the consumer wants now and in the future.
1/THE DIGITAL REVOLUTION & CONVERGENCE CULTURE
Henry Jenkins, Professor of Media Studies at M IT in his book ‘Convergence Culture’ talks of the new ways our media and culture works, we live in a world where every brand, every message, every sound and every image is spread across every media channel either legally or illegally.
On the one hand this spread is shaped by boardroom decisions as companies try to maximize the spread of their brand messages by ensuring every franchise plays across the overall vision of the company, while media companies try to maximize ownership of multi media channels.
It is also spread by the consumers who want the media they want; how they want it, when they want it and in the forms they want it. If companies don’t make it available to them legally, they will take it illegally.
In tandem with this culture convergence has been the birth of web 2.0, a second generation of internet-based services such as social networking sites, wikis and social communication tools — that have led people collaborate and share information online in ways previously unavailable.
2/THE ALL POWERFUL CONSUMER - A WORLD OF COLLECTIVE INTELLIGENCE
We now live in a world where the consumer is constantly scanning the media environment looking for media properties they care about and companies have lost control.
The consumer can do anything they want with your brand, your advertisement your entertainment content. They can mix it, mash it up, mod it, remix it, spread it through the internet, put it on You tube and download it through bit torrent and there is very little you as a company can do about it.
What is exciting is the degree to which companies are beginning to realize the power these participatory audience exert through what Jenkins’s calls “a world of collective intelligence’.
Henry Jenkins talks in terms of companies shifting away from an old prohibitionist model which says don’t touch my intellectual property its mine to control to a more collaborationist model which actively seeks to engage the consumer by giving up this control and allowing consumers to generate their own content on the platform provided and it is this thinking that is at the heart of the transformation that is taking place in our media today.
The consumer in this context has a very powerful role to play so if a blogger finds out some information damaging to a company they can spread this very quickly and what was a brand community one minute can turn out to be your harshest critic the next.
3/THE GROWTH OF USER GENERATED CONTENT
It is the notion of consumer behavior coupled with the changes in technology that has led to the new area of user-generated digital entertainment being born. The growth of digital video over the last 12 months has been nothing short of phenomenal, culminating with acquisition of My Space and You Tube by News Corp and Google respectively.
Inevitably the flood of creativity on line from sites like You Tube, My Space, Google video, Revver.com, Breaker.com, Lulu, TV, Blip TV has led to the interest of Hollywood, TV Producers and advertisers.
For example, NBC has ordered web and TV scripts of two You Tube’s video hits that attract over one million views each: ‘Nobody's Watching’ and the weekly wranglings of video pod cast ‘Ask a Ninja’ starring two ski mask sporting actors.
‘The Diet Coke and Mento’s Experiment‘, combustibly combined in the fashion of a synchronized fountain which has earned its creators over US $30,000 with over 5 million hits on US website Revver.com (which incidentally pays creators for its content) is also receiving an NBC show case on ‘Late Night with Letterman’.
A recent survey by the Pew Internet and American Life Project found that 40% of Internet users have posted content online and that user-generated content is mostly driven by the under 30’s, within this age group it was noted that 62 % viewed content generated by someone they knew.
It is argued that online platforms hosting user-generated content have already amassed audiences exceeding those for some traditional media platforms. Clearly a new critical mass has been born.
4/THE SCRAMBLE TO MAKE MEDIA CONTENT AVAILABLE -CURRENT INITIATIVES
This transformation has led to media companies scrambling to make their media content available across a variety of platform devices, anxious to avoid what happened to the music industry happening to them and is seen as the key to modernizing many media companies and how they make their content available against the growth of user-generated content.
This year in the US the Disney ABC television group made its first foray into making it content available online in a groundbreaking deal with I-Tunes and the development of it’s own on-line media player.
Disney also made its hit TV series ‘Desperate Housewives’ and ‘Lost’ available online and its Kid’s Channel available online. In the experiment the Kid’s Channel had 3.7 million to 5.7 million streams to that of the TV series which speaks volumes about childrens’ rapid adaption to the power of technology.
Click Star www.cstar.com, a joint venture between Intel and Morgan Freeman’s Revelation Entertainment is being positioned as the show case for internet video and Intel’s new ‘Viiv’ Platform. As well as a Danny Devito’s documentary channel there will be a movie channel hosted by film director Peter Bogdanovich which will provide old and new movies shortly after release.
5/TECHNOLOGY DEVELOPMENTS/ISSUES-THE BATTLE FOR THE LIVING ROOM
At the moment it is still too difficult and complex for the average person to take content from their PC and transfer it around the various devices in the home but all that is set to change as we see advances in home networking.
Currently standing in the way are compatibility issues highlighted in the battle for dominance taking place around file formats for digital video and how it will be protected. On the one side we have Apple’s rights protected ‘Fairplay’ system and on the other Microsoft’s windows media DRM. While I-Tunes has become the Walmart of legal music and video downloads, many media and executives prefer Windows DRM and Windows will be supported by a wide variety of platform manufacturers.
January 2007 sees the battle to make the PC the entertainment hub of the home intensify with the launch of Microsoft’s new ‘Vista ‘operating system. Designed to complement the media Centre Edition (MCE) of the XP windows operating system, MCE provides a UI specifically designed for operation at 10ft in sit-back mode. Hewlett Packard has also recently debuted its successful Widescreen media smart TV which also syncs to one’s own home network.
The huge growth in video that enters the home through the Internet will be displayed on your TV as well as your PC.
The cable networks have also been quick to get in on the action with AOL launching its own 10ft experience, ‘AOL Hi- Q’ went online this month and allows consumer DVD quality video on line. In the UK, British Telecom in conjunction with Microsoft are launching its own IPTV service ‘BT Vision’ and in December Apple will launch its I-TV set top box that will sync TV sets to its I-Tunes portal.
The development of game consoles also represents another viable means of digital entertainment for the living room with Sony Playstation 3 and Microsoft's X Box 360 both connecting to the internet and being marketed as home entertainment hubs to pipe movies, TV programming and music in addition to games. Incorporated into both new players is a HD DVD drive that is being touted as the next generation format which provides six times the resolution of a standard DVD and a higher level of interactivity.
Either way you look at it ‘the battle for the living room’ is showing no signs of abating and it’s anyone’s guess how things will pan out. One thing is certain: we are still a long way from the one black box which will pipe all our entertainment; however with advances in technology you will see hardware become more robust, more powerful and more affordable at every level.
6/3-D PHOTO REALISM -THE NEXT STEP IN ONLINE GAMING & VIRTUAL REALITY
Right now, computer generated animation for films, games and virtual reality (VR) only go 95% of the way there but with enormous advances in video processing technology it is only a matter of time until that last 5% achieves photo realistic rendering. Imagine in virtual reality being able to put your own face on your avatar or player in your favorite online game, complete with facial expressions.
With My Space losing it’s cool factor it will be interesting to see how VR sites like Second Life (www.secondlife.com) and MTV ‘s newly launched Virtual Laguna Beach (www.vlb.mtv.com) will impress over the coming months. Where else can you cross a reality TV show, My Space, a Personalized website and day-to-day life? Using an avatar, VR lets users travel through a virtual world and interact and share experiences with other users. 80’s Pop act Duran Duran and other musicians have done virtual concerts in Second Life and interacted with fans in ways never thought imaginable in the real world. There is no reason why we won’t be able to work in VR in the future.The possibilities are limited only by our imagination.
7/COPY RIGHT-THE DIGITAL SHOW DOWN
Striking the balance between owning intellectual property and giving consumers control is key to the debate over copyright. Two main camps have emerged, each with widely divergent views.
One group comprised of traditional media companies and hard ware/software companies. Those who believe information is a commodity that can be bought and its distribution controlled. On the other side are those who believe that information, by its nature should be free and its distribution uncontrolled, this group comprises of a few far sighted computer companies Google, IBM and most consumers.
In Kevin Kelly's book ‘New Rules for the New Economy” he explains how the magic of the internet has turned conventional business models on their heads. In the old world, wealth was based upon physical objects, value came from scarcity; in the information age value comes from abundance. The more people who have access to information the more valuable that Information is.
Rob Metcalfe the inventor of the Ethernet networking standard explains it very well in what became known as Metcalfe’s Law - the utility of a network expands by the square of the number of users. The more people on the network the more conversations are possible. Those who want to restrict the flow of information think of information as little atoms rather than as part of a great network .The furor currently surrounding YouTube is a classic example; numerous companies are engaged with litigation for copyright infringements and requesting their content be removed from the site.
These people claim to be in the content-delivery business but they do not understand it. YouTube grew from nothing to be sold for 1.65BillionUS dollars within 18 months, because of ‘the free flow of information’. DRM is another example which restricts the way information can be used in software or hardware Advocates of this technology say that it is necessary to protect the rights of artists and publishers but all the signs point to the inevitable demise of copyright.
A website www.defectivebydesign.org goes one step further in the campaign against the control of information. It is a grassroots movement against the absurdity of DRM. Targeting all manufactures. DRM products have restricted features built in that restrict what jobs they can do, products that have been intentionally crippled are, from the users point of view, defective by design.
8/MOVING TOWARDS A NEW MEDIA MODEL -THE SIGNIFICANCE OF GOOGTUBE
Moving towards a new media model the combination of Goggle’s search savvy and You Tubes handle on Internet video yields the first viable new media successor to broadcast and cable TV. The union offers the interactive infrastructure and tools needed to manage and monetize web-based digital video unmatched by traditional media platforms.
What it means is that the Ad dollars and creative content that have sustained traditional media will increasingly shift to interactive platforms that can give consumers and advertisers more of what they want on interchangeable screens.
The 6.2 million daily visitors to You Tube are ripe for Google’s advertising savvy technology which gives immediate open access to most commercial and user generated content. It reflects the demands of a young audience that will broaden as it matures.
Clearly the emerging standard for video and information is on-demand interactivity, being able to download and store content across any platform or device. The search engine is the means to manage this content, one cannot exist without the other. Add to this the ability to charge consumers and advertisers and you have a ready made new media model. Google can perfect ways of making money from content online by connecting the right targeted consumers, advertisers, content producers, platforms and devices.
9/THE FUTURE OF DIGITAL ENTERTAINMENT
By 2010 it is predicted all TV will be digital, your computer will be able to speak to a whole host portable and lounge room devices, even sing to us, Broadband penetration will be 75% of all households and 80% of all advertising will be on line.
Henry Jenkins talks of us being in an apprenticeship phase where we are still learning to use the new consumer power at our disposal in a age of convergence. If we fast track five years’ we have learnt to harness this power and these skills will have spread from niche fan based communities to general consumers.
As demand for content soars, more consumers are seeking out information in online communities and engaging in media content in new ways. We will no longer be watching scheduled prime time shows, we will be subscribing to TV programs in the same way we subscribe to a magazine.
The opportunity for niche programming via an Internet based model will be significantly increased as those shows with a niche dedicated market and audience will be able to support and fully fund the show.
The idea of niche products is more fully explored in Chris Anderson’s book ‘The Long Tail’ which demonstrates that the renaissance being enjoyed by back catalogue titles can be also applied to other industries. He cites the example of one US line music website Rhapsody being able to sell each of its 1 million music titles at least once a month; out of its total sales 40% of titles were previously unavailable. This, he argues, is part of ‘the economics of abundance’ in a new digital world and has been coined ‘the long tail effect’ www.thelongtail.com
In the future there will be more examples of transmedia storytelling techniques, like ‘The Matrix’ where stories are told across different media platforms. Right now children‘s content like Pokemon have this integrated story-telling technique but we will reach the point where the West Wings of the future will be fully integrated across multiple TV shows and multiple web platforms. The notion of a ‘good’ drama will be one that lets the viewer go as deep as s/he like and have as much complexity as s/he wants. Interactivity will become a more important part of the TV viewing experience which means more reality TV programs.
SUMMARY
The transformation of the digital entertainment space will give the consumer the power to control their entertainment space in hitherto unimaginable ways. Any online strategy will have to cater for a level of consumer interaction unheard of ten years ago.
The concept of Kevin Roberts “inspirational consumer’ will be the norm in all forms of online marketing and advertising. The theory is that those core consumers that care passionately about your product have an important role to play, therefore companies had better listen to and engage them. Companies will aspire to that sweet spot where brand message and fan community meet. Branded entertainment, intelligently incorporated into programming, will be as much part of everyday life as the 30-second TVC slot was to traditional media companies over the last 50 years.
A Google style advertising/subscription based on ‘the economics of abundance’ will be the new media model that companies adhere to in an information age with no copyright restrictions. A world of digital entertainment that Chris Anderson describes as providing endless choice that creates unlimited demand.
We will be able to lead multiple lives in various virtual worlds and, armed with just a computer and mobile phone, it will no longer matter where you live if you can work online and communicate Holographically with those people you choose and need to interact with.
Thomas Freidman’s best selling book ‘The World is Flat’ talks of a world where the power of the internet makes it possible for individuals to collaborate and compete globally. He tells us that by 2020 the free flow of information will completely blur national boundaries and they will be replaced by corporation-based cultural groupings and reconfigured human organizations tied together by global networks. Maybe this isn’t so far from the truth.
Acknowledgements
’New Rules for the new Economy’ -Kevin Kelly -1999
‘Sisomo’-Kevin Roberts, Powerhouse Books 2004 www.sisomo.com
‘Convergence Culture’-Henry Jenkins 2006 New York University Press
‘The Future of Entertainment’-special The Hollywood Reporter September 26 2006
‘Broadband Delivery of Film and TV content over the open Internet: A technical discussion of the technical issues and Hurdles-The British Screen Advisory Council Briefing Paper: Ben Keen 2006
Let me entertain you’ -Article by Simon Van Wyk Australian Newspaper 2026 Magazine Special: Entertainment
’What is web 2.0’- Tim O’Reilly-30/9/2005 O'Reilly web resources www.oreilly.com
‘Pew Internet and American Life Project’-The Future of the Internet-24th Sept 2006 www.pewinternet.org
Goog deal shifts paradigm on demand”-Hollywood Reporter article October 17 2006
Madison & Vine’-Scott Donation McGraw Hill 2004
The coming digital showdown’-Graeme Philipson SMH article October 17 2006
The World is Flat-Thomas Freidman-Farrar, Straus and Giroux 2005
The Long Tail’-Chris Anderson-Randon House Business Books 2006
The penetration of broadband and the sophistication of the end-user means that the Internet is no longer seen merely as an information gathering point and purchase space.
Today it is as much an entertainment hub and is part of the digital revolution changing the face of entertainment. This document outlines trends in digital entertainment and current initiatives; how the lounge room/online entertainment space of tomorrow will look and impact on the future of digital entertainment. It further examines the culture of consumer behavior and how we can deliver an online strategy in line with what the consumer wants now and in the future.
1/THE DIGITAL REVOLUTION & CONVERGENCE CULTURE
Henry Jenkins, Professor of Media Studies at M IT in his book ‘Convergence Culture’ talks of the new ways our media and culture works, we live in a world where every brand, every message, every sound and every image is spread across every media channel either legally or illegally.
On the one hand this spread is shaped by boardroom decisions as companies try to maximize the spread of their brand messages by ensuring every franchise plays across the overall vision of the company, while media companies try to maximize ownership of multi media channels.
It is also spread by the consumers who want the media they want; how they want it, when they want it and in the forms they want it. If companies don’t make it available to them legally, they will take it illegally.
In tandem with this culture convergence has been the birth of web 2.0, a second generation of internet-based services such as social networking sites, wikis and social communication tools — that have led people collaborate and share information online in ways previously unavailable.
2/THE ALL POWERFUL CONSUMER - A WORLD OF COLLECTIVE INTELLIGENCE
We now live in a world where the consumer is constantly scanning the media environment looking for media properties they care about and companies have lost control.
The consumer can do anything they want with your brand, your advertisement your entertainment content. They can mix it, mash it up, mod it, remix it, spread it through the internet, put it on You tube and download it through bit torrent and there is very little you as a company can do about it.
What is exciting is the degree to which companies are beginning to realize the power these participatory audience exert through what Jenkins’s calls “a world of collective intelligence’.
Henry Jenkins talks in terms of companies shifting away from an old prohibitionist model which says don’t touch my intellectual property its mine to control to a more collaborationist model which actively seeks to engage the consumer by giving up this control and allowing consumers to generate their own content on the platform provided and it is this thinking that is at the heart of the transformation that is taking place in our media today.
The consumer in this context has a very powerful role to play so if a blogger finds out some information damaging to a company they can spread this very quickly and what was a brand community one minute can turn out to be your harshest critic the next.
3/THE GROWTH OF USER GENERATED CONTENT
It is the notion of consumer behavior coupled with the changes in technology that has led to the new area of user-generated digital entertainment being born. The growth of digital video over the last 12 months has been nothing short of phenomenal, culminating with acquisition of My Space and You Tube by News Corp and Google respectively.
Inevitably the flood of creativity on line from sites like You Tube, My Space, Google video, Revver.com, Breaker.com, Lulu, TV, Blip TV has led to the interest of Hollywood, TV Producers and advertisers.
For example, NBC has ordered web and TV scripts of two You Tube’s video hits that attract over one million views each: ‘Nobody's Watching’ and the weekly wranglings of video pod cast ‘Ask a Ninja’ starring two ski mask sporting actors.
‘The Diet Coke and Mento’s Experiment‘, combustibly combined in the fashion of a synchronized fountain which has earned its creators over US $30,000 with over 5 million hits on US website Revver.com (which incidentally pays creators for its content) is also receiving an NBC show case on ‘Late Night with Letterman’.
A recent survey by the Pew Internet and American Life Project found that 40% of Internet users have posted content online and that user-generated content is mostly driven by the under 30’s, within this age group it was noted that 62 % viewed content generated by someone they knew.
It is argued that online platforms hosting user-generated content have already amassed audiences exceeding those for some traditional media platforms. Clearly a new critical mass has been born.
4/THE SCRAMBLE TO MAKE MEDIA CONTENT AVAILABLE -CURRENT INITIATIVES
This transformation has led to media companies scrambling to make their media content available across a variety of platform devices, anxious to avoid what happened to the music industry happening to them and is seen as the key to modernizing many media companies and how they make their content available against the growth of user-generated content.
This year in the US the Disney ABC television group made its first foray into making it content available online in a groundbreaking deal with I-Tunes and the development of it’s own on-line media player.
Disney also made its hit TV series ‘Desperate Housewives’ and ‘Lost’ available online and its Kid’s Channel available online. In the experiment the Kid’s Channel had 3.7 million to 5.7 million streams to that of the TV series which speaks volumes about childrens’ rapid adaption to the power of technology.
Click Star www.cstar.com, a joint venture between Intel and Morgan Freeman’s Revelation Entertainment is being positioned as the show case for internet video and Intel’s new ‘Viiv’ Platform. As well as a Danny Devito’s documentary channel there will be a movie channel hosted by film director Peter Bogdanovich which will provide old and new movies shortly after release.
5/TECHNOLOGY DEVELOPMENTS/ISSUES-THE BATTLE FOR THE LIVING ROOM
At the moment it is still too difficult and complex for the average person to take content from their PC and transfer it around the various devices in the home but all that is set to change as we see advances in home networking.
Currently standing in the way are compatibility issues highlighted in the battle for dominance taking place around file formats for digital video and how it will be protected. On the one side we have Apple’s rights protected ‘Fairplay’ system and on the other Microsoft’s windows media DRM. While I-Tunes has become the Walmart of legal music and video downloads, many media and executives prefer Windows DRM and Windows will be supported by a wide variety of platform manufacturers.
January 2007 sees the battle to make the PC the entertainment hub of the home intensify with the launch of Microsoft’s new ‘Vista ‘operating system. Designed to complement the media Centre Edition (MCE) of the XP windows operating system, MCE provides a UI specifically designed for operation at 10ft in sit-back mode. Hewlett Packard has also recently debuted its successful Widescreen media smart TV which also syncs to one’s own home network.
The huge growth in video that enters the home through the Internet will be displayed on your TV as well as your PC.
The cable networks have also been quick to get in on the action with AOL launching its own 10ft experience, ‘AOL Hi- Q’ went online this month and allows consumer DVD quality video on line. In the UK, British Telecom in conjunction with Microsoft are launching its own IPTV service ‘BT Vision’ and in December Apple will launch its I-TV set top box that will sync TV sets to its I-Tunes portal.
The development of game consoles also represents another viable means of digital entertainment for the living room with Sony Playstation 3 and Microsoft's X Box 360 both connecting to the internet and being marketed as home entertainment hubs to pipe movies, TV programming and music in addition to games. Incorporated into both new players is a HD DVD drive that is being touted as the next generation format which provides six times the resolution of a standard DVD and a higher level of interactivity.
Either way you look at it ‘the battle for the living room’ is showing no signs of abating and it’s anyone’s guess how things will pan out. One thing is certain: we are still a long way from the one black box which will pipe all our entertainment; however with advances in technology you will see hardware become more robust, more powerful and more affordable at every level.
6/3-D PHOTO REALISM -THE NEXT STEP IN ONLINE GAMING & VIRTUAL REALITY
Right now, computer generated animation for films, games and virtual reality (VR) only go 95% of the way there but with enormous advances in video processing technology it is only a matter of time until that last 5% achieves photo realistic rendering. Imagine in virtual reality being able to put your own face on your avatar or player in your favorite online game, complete with facial expressions.
With My Space losing it’s cool factor it will be interesting to see how VR sites like Second Life (www.secondlife.com) and MTV ‘s newly launched Virtual Laguna Beach (www.vlb.mtv.com) will impress over the coming months. Where else can you cross a reality TV show, My Space, a Personalized website and day-to-day life? Using an avatar, VR lets users travel through a virtual world and interact and share experiences with other users. 80’s Pop act Duran Duran and other musicians have done virtual concerts in Second Life and interacted with fans in ways never thought imaginable in the real world. There is no reason why we won’t be able to work in VR in the future.The possibilities are limited only by our imagination.
7/COPY RIGHT-THE DIGITAL SHOW DOWN
Striking the balance between owning intellectual property and giving consumers control is key to the debate over copyright. Two main camps have emerged, each with widely divergent views.
One group comprised of traditional media companies and hard ware/software companies. Those who believe information is a commodity that can be bought and its distribution controlled. On the other side are those who believe that information, by its nature should be free and its distribution uncontrolled, this group comprises of a few far sighted computer companies Google, IBM and most consumers.
In Kevin Kelly's book ‘New Rules for the New Economy” he explains how the magic of the internet has turned conventional business models on their heads. In the old world, wealth was based upon physical objects, value came from scarcity; in the information age value comes from abundance. The more people who have access to information the more valuable that Information is.
Rob Metcalfe the inventor of the Ethernet networking standard explains it very well in what became known as Metcalfe’s Law - the utility of a network expands by the square of the number of users. The more people on the network the more conversations are possible. Those who want to restrict the flow of information think of information as little atoms rather than as part of a great network .The furor currently surrounding YouTube is a classic example; numerous companies are engaged with litigation for copyright infringements and requesting their content be removed from the site.
These people claim to be in the content-delivery business but they do not understand it. YouTube grew from nothing to be sold for 1.65BillionUS dollars within 18 months, because of ‘the free flow of information’. DRM is another example which restricts the way information can be used in software or hardware Advocates of this technology say that it is necessary to protect the rights of artists and publishers but all the signs point to the inevitable demise of copyright.
A website www.defectivebydesign.org goes one step further in the campaign against the control of information. It is a grassroots movement against the absurdity of DRM. Targeting all manufactures. DRM products have restricted features built in that restrict what jobs they can do, products that have been intentionally crippled are, from the users point of view, defective by design.
8/MOVING TOWARDS A NEW MEDIA MODEL -THE SIGNIFICANCE OF GOOGTUBE
Moving towards a new media model the combination of Goggle’s search savvy and You Tubes handle on Internet video yields the first viable new media successor to broadcast and cable TV. The union offers the interactive infrastructure and tools needed to manage and monetize web-based digital video unmatched by traditional media platforms.
What it means is that the Ad dollars and creative content that have sustained traditional media will increasingly shift to interactive platforms that can give consumers and advertisers more of what they want on interchangeable screens.
The 6.2 million daily visitors to You Tube are ripe for Google’s advertising savvy technology which gives immediate open access to most commercial and user generated content. It reflects the demands of a young audience that will broaden as it matures.
Clearly the emerging standard for video and information is on-demand interactivity, being able to download and store content across any platform or device. The search engine is the means to manage this content, one cannot exist without the other. Add to this the ability to charge consumers and advertisers and you have a ready made new media model. Google can perfect ways of making money from content online by connecting the right targeted consumers, advertisers, content producers, platforms and devices.
9/THE FUTURE OF DIGITAL ENTERTAINMENT
By 2010 it is predicted all TV will be digital, your computer will be able to speak to a whole host portable and lounge room devices, even sing to us, Broadband penetration will be 75% of all households and 80% of all advertising will be on line.
Henry Jenkins talks of us being in an apprenticeship phase where we are still learning to use the new consumer power at our disposal in a age of convergence. If we fast track five years’ we have learnt to harness this power and these skills will have spread from niche fan based communities to general consumers.
As demand for content soars, more consumers are seeking out information in online communities and engaging in media content in new ways. We will no longer be watching scheduled prime time shows, we will be subscribing to TV programs in the same way we subscribe to a magazine.
The opportunity for niche programming via an Internet based model will be significantly increased as those shows with a niche dedicated market and audience will be able to support and fully fund the show.
The idea of niche products is more fully explored in Chris Anderson’s book ‘The Long Tail’ which demonstrates that the renaissance being enjoyed by back catalogue titles can be also applied to other industries. He cites the example of one US line music website Rhapsody being able to sell each of its 1 million music titles at least once a month; out of its total sales 40% of titles were previously unavailable. This, he argues, is part of ‘the economics of abundance’ in a new digital world and has been coined ‘the long tail effect’ www.thelongtail.com
In the future there will be more examples of transmedia storytelling techniques, like ‘The Matrix’ where stories are told across different media platforms. Right now children‘s content like Pokemon have this integrated story-telling technique but we will reach the point where the West Wings of the future will be fully integrated across multiple TV shows and multiple web platforms. The notion of a ‘good’ drama will be one that lets the viewer go as deep as s/he like and have as much complexity as s/he wants. Interactivity will become a more important part of the TV viewing experience which means more reality TV programs.
SUMMARY
The transformation of the digital entertainment space will give the consumer the power to control their entertainment space in hitherto unimaginable ways. Any online strategy will have to cater for a level of consumer interaction unheard of ten years ago.
The concept of Kevin Roberts “inspirational consumer’ will be the norm in all forms of online marketing and advertising. The theory is that those core consumers that care passionately about your product have an important role to play, therefore companies had better listen to and engage them. Companies will aspire to that sweet spot where brand message and fan community meet. Branded entertainment, intelligently incorporated into programming, will be as much part of everyday life as the 30-second TVC slot was to traditional media companies over the last 50 years.
A Google style advertising/subscription based on ‘the economics of abundance’ will be the new media model that companies adhere to in an information age with no copyright restrictions. A world of digital entertainment that Chris Anderson describes as providing endless choice that creates unlimited demand.
We will be able to lead multiple lives in various virtual worlds and, armed with just a computer and mobile phone, it will no longer matter where you live if you can work online and communicate Holographically with those people you choose and need to interact with.
Thomas Freidman’s best selling book ‘The World is Flat’ talks of a world where the power of the internet makes it possible for individuals to collaborate and compete globally. He tells us that by 2020 the free flow of information will completely blur national boundaries and they will be replaced by corporation-based cultural groupings and reconfigured human organizations tied together by global networks. Maybe this isn’t so far from the truth.
Acknowledgements
’New Rules for the new Economy’ -Kevin Kelly -1999
‘Sisomo’-Kevin Roberts, Powerhouse Books 2004 www.sisomo.com
‘Convergence Culture’-Henry Jenkins 2006 New York University Press
‘The Future of Entertainment’-special The Hollywood Reporter September 26 2006
‘Broadband Delivery of Film and TV content over the open Internet: A technical discussion of the technical issues and Hurdles-The British Screen Advisory Council Briefing Paper: Ben Keen 2006
Let me entertain you’ -Article by Simon Van Wyk Australian Newspaper 2026 Magazine Special: Entertainment
’What is web 2.0’- Tim O’Reilly-30/9/2005 O'Reilly web resources www.oreilly.com
‘Pew Internet and American Life Project’-The Future of the Internet-24th Sept 2006 www.pewinternet.org
Goog deal shifts paradigm on demand”-Hollywood Reporter article October 17 2006
Madison & Vine’-Scott Donation McGraw Hill 2004
The coming digital showdown’-Graeme Philipson SMH article October 17 2006
The World is Flat-Thomas Freidman-Farrar, Straus and Giroux 2005
The Long Tail’-Chris Anderson-Randon House Business Books 2006
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