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Chapter 10 - Online content and media. The main contents of this chapter include all of the following: Trends in online content, 2010-2011; content audience and market; internet and traditional media; digital content delivery models; media industry structure;...
Ecommerce business. technology. society seventh edition Kenneth C Laudon Carol Guercio Traver Copyright © 2011 Pearson Education, Inc Copyright © 2011 Pearson Education, Inc Chapter 10 Online Content and Media Copyright © 2011 Pearson Education, Inc Copyright © 2010 Pearson Education, Inc Copyright © 2011 Pearson Education, Inc Slide 102 Information Wants to Be Expensive Class Discussion Why did the Wall Street Journal succeed with a subscription model? Would you pay to read a daily newspaper online? Why or why not? Would you pay for access to online archives of newspapers and/or magazines? Do you think newspapers can make the transition from “print on paper” to “news onscreen?” What you think about the New York Times’ Copyright © 2011 Pearson Education, Inc plan for a subscription-based model? Slide 103 Trends in Online Content, 20102011 Increased media consumption Internet media revenues fastest growing Growth of Internet audience outpaces other media User-generated content growing, inverting traditional production/business models Entertainment moves to mobile devices Internet advertising revenues expanding rapidly Copyright © 2011 Pearson Education, Inc Slide 104 Trends in Online Content (cont’d) Content owners adapt mixture of advertising, subscription, ala carte payment for business model Paid content and free content coexist Convergence Newspapers in transition to online models Web becomes entertainment powerhouse Consumers increasingly support time-shifting, space-shifting in media consumption Copyright © 2011 Pearson Education, Inc Slide 105 Content Audience and Market Average American adult spends 3,900 hrs/yr consuming various media 2010 media revenues: $973 billion TV, radio, Internet: Account for over 80% of the hours spent consuming media Copyright © 2011 20 - 30% substituting Pearson Education, Inc online Slide 106 Media Utilization Copyright © 2011 Figure 10.1, Page 651 Pearson Education, Inc SOURCE: Based on data from U.S Census Bureau, 2010 Slide 107 Internet and Traditional Media Cannibalization vs complementarity Time spent on Internet reduces time available for other media Books, newspapers, magazines, phone, radio Conversely, Internet users consume more media of all types than non-Internet users Internet users also often “multitask” with media consumption Multimedia – reduces cannibalization impact for some visual, aural media Copyright © 2011 Pearson Education, Inc Slide 108 Media Revenues by Channel Copyright © 2011 Pearson Education, Inc Figure 10.2, Page 652 SOURCE: Based on data from U.S Census Bureau, 2010 Slide 109 Relative Size of the Content Market, Based on PerPerson Spending Copyright © 2011 Figure 10.3 Page 653 Pearson Education, Inc SOURCE: Based on data from U.S Census Bureau, 2010 Slide 1010 Convergence in Publishing Industry Technological convergence slowed by: Poor resolution of computer screens Lack of portable reader devices to compete with book DRM concerns Lack of standards Potential solutions Sub-pixel display technologies Electronic ink technology Copyright © 2011 Pearson Education, Inc DRM software Slide 1030 Convergence in Publishing Industry(cont’d) Content E-books in media integration stage XML and large-scale online text/graphic storage systems have transformed book production and made it more efficient Industry Industry Some structure still dominated by a few titans challenges from: Google, Microsoft in indexing copyrighted books Barnes & Noble move into publishing Self-publishing Copyright © 2011 Pearson Education, Inc Slide 1031 Insight on Society The Future of Books Class Discussion What technologies are changing the concept of what a book is? Do you consider Wikipedia a “book,” and if so, what type of book? What qualities makes Unigo a threat to traditionally published college references? Are some types of traditional books more threatened by Internet technologies than others? Copyright © 2011 Pearson Education, Inc Slide 1032 Online Entertainment Industry Major players: Television, radio, Hollywood films, music, video games Undergoing a transformation brought about by Internet, aided by: iPod/iPhone video and music platform Digital cellular networks Social networking platforms Viable business models in music subscription services Copyright © 2011 Widespread growth of broadband Pearson Education, Inc Slide 1033 The Five Major Players in the Entertainment Industry Copyright © 2011 SOURCE: Based on data from U.S Census Bureau, 2010; NPD Figure 10.10, Page 687 Group, 2010, authors’ estimates Pearson Education, Inc Slide 1034 Online Entertainment Audience Size Online “traditional” entertainment (films, music, games): Music downloads, followed by online games and TV, radio User-generated content: Substitutes for and complements traditional commercial entertainment Two dimensions: User focus User control Copyright © 2011 Sites that offer high levels of both will grow Pearson Education, Inc Slide 1035 Projected Growth in Traditional Online Entertainment (In Millions) Copyright © 2011 Pearson Education, Inc Figure 10.11, Page 689 SOURCES: Based on data from eMarketer, 2010, Stevenson, 2010; authors’ estimates Slide 1036 User Role in Entertainment Copyright © 2011 Pearson Education, Inc Figure 10.12, Page 690 Slide 1037 Content Internet has greatly changed packaging, distribution, marketing, sales of traditional entertainment Greatest impact: Music From CD of 12-15 songs to single-song downloads Groups can bypass traditional marketing and sales Revenue Models Copyright © 2011 Pearson Education, Inc Marketing, advertising, pay-per-view, Slide 1038 Convergence in Entertainment Industry Technology convergence: PCs and handheld devices (iPods) become music listening devices PC has become game station Game stations connect to Internet Movies Move and television toward Internet distribution Copyright © 2011 iTunes Store, Netflix, Hulu Pearson Education, Inc Slide 1039 Convergence in Entertainment Industry (cont’d) Content convergence Significant progress toward digital tools for content creation and production Digital cameras, workstations Music recording and production highly digitized; some distribution direct to Internet, bypassing CD production stage Copyright © 2011 Pearson Education, Inc Slide 1040 Convergence in Entertainment Industry(cont’d) Industry structure Fractionated: 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 © 2011 Pearson Education, Inc Slide 1041 Entertainment Industry Value Chains Copyright © 2011 Pearson Education, Inc Figure 10.13, Page 694 Slide 1042 Insight on Technology Hollywood Meets the Internet: Round 3 Class Discussion What strategies has Hollywood pursued to combat movie piracy? Are there legitimate ways that videos can be distributed on the Web? How can the differentiation of DVD products help in combating piracy? Do you think Hollywood is doing a better job of protecting its content than the music industry? Copyright © 2011 Pearson Education, Inc Slide 1043 All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher Printed in the United States of America Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall Copyright © 2011 Pearson Education, Inc ... Figure 10. 7, Page 672 SOURCES: Based on data from comScore, 2 010; eMarketer, 2 010 Slide? ?10? ?22 Newspaper Business Models Initially fee-based, then free, and now beginning a return to fee-based... Slide? ?10? ?25 Ebooks Evolution Project Gutenberg (1970s) Voyager’s books on CD (1990s) Adobe’s PDF format Types of commercial e-books Web-accessed e-book Web-downloadable e-book... advertising Pay-per-view/pay-for-download Charge for premium content Subscription Monthly charges for services Mixed Copyright © 2011 Pearson Education, Inc Slide? ?10? ?16 Making a Profit with Online Content