A few days ago, I had the opportunity of participating in the 15th Cable and Broadband Conference in Catalonia and commenting on Telvent's point of view on technology, the consumer and the market.
As regards technology, the surge of broadband in both fixed and mobile networks was one of the main instigators of change in the media sector. It opened up new business opportunities and lent seriousness to a mature sector that had become anchored to an analogue world hemmed in by its narrow spectrum.
With 22% of the population connected to broadband and 30% to Internet, a mobile penetration rate currently as high as to exceed 100% and the new possibilities in DTT, the sector has discovered new worlds and different possibilities of doing business by integrating channels and reaching the consumer by different routes (television viewer, listener, user, customer, etc.).
The sector is also observing a change in uses and profiles. On the one hand, children and young adults aged 8 to 24 do not watch as much television, although they interact with it increasingly by using other channels (telephone, Internet, etc.). In general, nearly all audiences have a wider range of choices in content and more power to decide, and content is therefore becoming much more important than the channel or means by which it is transmitted to the consumer.
Therefore, merging content platforms and channels enables different types of access, and results in a process of conversion and derivation toward different types of services which may be billed to the customer completely in the medium term. However, we cannot yet overlook the importance of revenues generated by advertising, which still constitute a significant part of the revenue according to profit and loss accounts for the sector, although there are certain exceptions.
From a market viewpoint, we are now witnessing growing corporate concentration. Since this is the result of a process to integrate channels completely (text, audio, video, TV and multimedia), it is necessary to reinforce the critical mass in order to play an increasingly important role in those channels. From now on, all companies will provide everything, since that is what content platforms now permit. This is the main cause of change in business models, and of the increasing importance of pay-per-view content and on-demand distribution. This trend is irreversible. In addition, a mature sector needs to strengthen itself through increased concentration, provided that it does not exceed the limits in the new Spanish law on audiovisual communications.
Furthermore, both production and technology are heading toward a "my camera and me"-type model in which anyone can be a real-life spectator and publish his or her creations online using formats that can be accessed by other means of communication. In other words, distribution has gone global. The creator of content in the media is currently a kind of platypus capturing real life in its totality, whether as text, audio or visual content, to bring together the offline and online worlds. This depends on impact on and demand by the consumer. Traditional newspapers are finding themselves obliged, for example, to bring together their traditional article-writing and online pieces, with the effort that this entails from the viewpoint of different profiles, uses and customs, as well as the technology in use. But it also affects the business model. What is going on in the latest news? What should be done when a scoop comes out?
Content no longer has the same shelf life it had before. Content can be integrated, interconnected and managed in such a way that when it interacts intelligently, it produces great value by regenerating itself in an automatic or "natural" way. If content is within everyone's reach, it means that it is permanently updated. Convergence toward the IP world (IPTV, VoIP, MobIP...) permits a level of standardisation that greatly favours and enriches content creation and distribution.
An enormous gap is being opened between reality and managed content. The consumer makes a choice. The consumer pays. Payments for not sharing or for not creating. Charges for content, not for access to the channel. Payments for exclusivity, quality and immediate receipt. Payments for gaining information just in time, for real-time events or for a conscientious analysis of reality.
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