Horizon Scan: ICT and the Future of Media

Networked Society Lab
ICT &
the future
of Media
Industry Transformation
– Horizon scan
Part 3/8 Industry Transformation – Horizon Scan: ICT & the Future of Media 1

Structure of this Report Series
This report is one in a series of seven investigating
industrial transformation in the Networked Society.
The impact of technology on our everyday lives and
economic interactions is undeniable. In conjunc-tion
with megatrends such as globalization, climate
change, urbanization and aging populations, ICT is
helping to transform our society and the economic
structures that have formed the basis of industries
since the industrial revolution.
Digital technologies allow new organizational forms to
emerge within and outside of industrial boundaries,
thereby challenging our traditional notions of economic
organization in markets. Where once size was an
important driver of success, now many smaller com-panies
are able to compete both locally and globally.
Where firm, strongly defined boundaries and clearly
defined economic roles were necessary, now the abil-ity
to dynamically participate in a variety of networks is
key to a resilient corporate strategy. ICT is transform-ing
the rules of our world’s economic value systems,
and industries are being transformed as a result.
It is not possible to provide a deep dive into every
industry covered within this series. Instead each report
investigates the role of ICT in creating productivity
improvements and industrial disruption with a view to
gaining a broad perspective on the overall transforma-tion
the world is undergoing. Six industries are inves-tigated
and across them general themes are identified
that form the basis of the final report, the “Economics
of the Networked Society”, which outlines some of the
broad economic principles that may help us under-stand
the era we are entering.
These reports represent the culmination of several
years’ work investigating the changing economic
structures of the world in the digital age. We hope our
small contribution helps to further not just the vision
of a Networked Society, but also its implementation
– a society where dynamic, digitally enabled strategic
networks allow us to build an economically, environ-mentally
and socially sustainable world.
2 Part 3/8 Industry Transformation – Horizon Scan: ICT & the Future of Media

Method
The reports in this series are developed using systems
analysis to identify the operating boundaries of each
industrial structure. Through analyzing the boundaries
and their associated thresholds, a stronger understand-ing
of capacity for change within an industry is possible
to achieve. This method combines systems analysis
with traditional measurement methods as well as ex-tensive
interviews across various parts of an industry’s
value chain in order to try and understand the possible
emergent characteristics of industrial structures and
the role that digital technologies may play in creating
innovation, disruptive or otherwise. Many boundaries
may be affected by a number of different aspects.
Within these reports, however, we focus solely on how
these thresholds can be adapted by ICT. Each report
outlines the following:
1. The industrial boundaries and associated
thresholds
2. The role of data within those boundaries
and the emerging information value chains
3. An overview of the industrial archetypes /
organizational forms of start-ups in the industry
Each of these industrial analyses has then been further
analyzed to understand the emerging characteristics
of the Networked Society, which is covered in the final
report.
For further information on the method, contact
Dr Catherine Mulligan: c.mulligan@imperial.ac.uk

ICT & THE FUTURE OF MEDIA
TABLE OF
CONTENTS
Structure of this Report Series 2
Method 3
Scope of the Report 5
Executive Summary 6
1. Introduction 7
2. Industrial Structure of the Media Industry 9
2.1 Value Chain of the Traditional Media Industry 10
2.2 Impact of Digital on Media Value Chains 11
2.3 Intermediaries and Aggregation 12
3. Media Industry Thresholds 13
3.1 Bandwidth, Connectivity and Speed 14
3.2 Consumption 17
3.3 Financing 18
3.3.1 Advertising 19
3.3.2 ICT and Cross-Media Advertising 20
3.3.4 Nature of Media Advertising in the Digital Era 21
3.4 Intellectual Property 22
3.5 Subscription Fees 23
3.6 Regulatory Aspects 24
4. Industrial Disruption in Media 26
4.1 Authoritarian /Unilateral 27
4.2 Entrepreneurial/Distributed 29
4.3 Democratic/Inclusive 31
5. Conclusions 32

ICT & THE FUTURE OF MEDIA
Scope of the report
The media industry covers an extremely broad range
of sectors, including:
> Film
> Television
> Music
> Print
> Computer games
> Advertising and marketing
> Interactive media
> Press and radio
This report focuses on film, television and music, with
some references to the application of social media
within these contexts. In addition, due to convergence
of cable, mobile and transmission technologies over
the Internet Protocol, the pattern of transmission and
content distribution is shifting. Smartphones, tablets
and a variety of other devices are enabling end users to
access content on demand and in the format that they
wish to receive it.
At the same time, a broad variety of industrial struc-tures
are active in media from public service, which
is financed by governments; independents, which are
often a handful of people creating niche products for
specialist markets; multinationals, e.g. BskyB, which
delivers Sky Sports across the globe; and media
conglomerates that provide some of the larger-scale
services across the globe, e.g. Bertelsmann, which
operates in over 50 countries and owns multiple TV
and radio stations across the EU. All of this adds to the
complexity of the media industry. For the purposes of
this report, we focus on private companies and the as-sociated
and intellectual property protection, with some refer-ence
to public service.
This report focuses on the role of ICT in reforming and
disrupting the industrial structure, specifically how
content is created, delivered and distributed to end us-ers.
The report therefore has a consumer-centric, rather
than a supplier-centric perspective on the industry.
AUTHORS
Dr C.E.A. Mulligan, Research Fellow, Imperial College London
Dr Zeynep Gurguc, Research Associated, Imperial College London
Sohrab Mosiri, Manchester Business School
business models of advertising, subscriptions
DISCLAIMER
All care has been taken in the preparation of this document, but no responsibility will be taken for decisions made on the basis of its contents.
1 IPCC (2007) Intergovernmental panel on climate change, Working Group III, Report May 2007.

Executive summary
Perhaps more than any other industry, media typifies
modern society and culture. It connects commerce with
audiences, relates world events to households, cre-ates
celebrity, and defines the cutting-edge. Access to
smartphones and tablets has affected not just consump-tion
patterns, but also the ability to participate in content
creation. Social media have created opportunities for
consumers to participate in all aspects of the media
value chain. Many substantial brands have been eroded
or collapsed, while others have emerged as new cham-pions
of the digital era. Content creators, media compa-nies
and distribution companies alike need to adopt agile
strategies and exploit innovative business models in
order to survive in this competitive and growing market.
The media industry is still undergoing dramatic changes.
The amount of available content is increasing, and
more people can access it due to the proliferation
of mobile broadband, digital TV and IP transmission
technologies. The way in which media is created and
consumed is also changing due to the use of digital
technologies and the emergence of “prosumers” who
often work together across networks to create content.
This report provides an overview of the drivers of
change within the media industry. It is evident that the
media industry is still changing rapidly and fundamen-tally.
New patterns of convergence and new alliances
and configurations across the media supply chain will
bring greater innovation to media, in terms both of
products and services adopted by the consumer, and
how the industry is configured to provide them.
The report outlines three main organizational arche-types
for media production within the Networked
Society – Unilateral/Authoritarian, Entrepreneurial/
Distributed and Democratic/Inclusive. Each of these
has different advertising, distribution and content
development models. The report concludes with a pro-jection
of what might come next in the media industry.

1.
Introduction
“ In 1472 the best university library
in the world, at Queen’s college in
Cambridge, housed 199 books.”
Davenport & Beck, 20011
Media is currently undergoing a series of dramatic
transformations as the traditional power structures
in the industry are challenged by digital technolo-gies.
New forms of content creation have long been
understood as potentially disruptive elements, with
user-generated content (UGC) proliferating in many
different forms, from podcasts to blog posts and
YouTube videos creating critical mass, or going “viral”,
challenging the established content creation methods
of large studios and television channels. UGC has also
challenged the dominance of American culture around
the world, as people of all cultures and languages are
able to create content relatively cheaply. This trend will
only continue with the obvious need to create content
for and by the emerging BRIC markets2.
UGC is just the start of these transformations, however,
as digital technologies allow new forms of power dis-tribution
to emerge for the media industry. Prior to the
advent of cheap and ubiquitous ICT, the costs of media
production and distribution were much higher. Indus-tries
were formed around the management and exploi-tation
of these costs, and the newspaper, television, film
and music industries of the late 20th century flourished
on high sales, high-paid stars and many forms of adver-tising.
Much of the common culture of these decades
was set by the actions of these industries. It is argu-able
that mass media had a significant role in defining
society as we knew it. Expensive production combined
with expensive PR, marketing and distribution. This
created extremely high barriers to entry for anyone
wishing to enter this market. For example, it would cost
at least US$200 million to create a cable network, or
US$50 million for a national magazine3, leading to the
development of extremely large, well coordinated media
production corporations dominating the media industry.
In the USA, these included the Washington Post, NBC,
20th Century Fox and CBS, among other large corpora-tions.
Products that were profitable for these compa-nies
dictated popular culture.
Today, ICT has dramatically lowered the barriers to
entry, enabling users to challenge dominant culture and
exposure to advertising. As a result, the overall media
industry is facing a significant battle between old and
new models. While the truly digital media industry is still
emerging, many of the newly formed companies are the
emerging corporations and conglomerates of the future
media industry as it reforms itself in response to the
digital challenge.
1 Davenport, T. H., & Beck, J. C. (2001), The attention economy: Understanding the new
currency of business, Boston: Harvard Business School Press.
2 Media Vision, 2020, Ericsson
3 Carr, D., 2014, Ezra Klein Is Joining Vox Media as Web Journalism Asserts Itself,
NY times, Jan 26, 2014

1. INTRODUCTION
The blurring of the boundaries between technology
and broadcasting, combined with the growing number
of broadcast platforms, creates new opportunities to
engage audiences and increase revenues. It is there-fore
important to understand the implementation and
monetization of content enabled by digital structures
and the current economic structure.4
The internet economy has also acted as a catalyst of
economic growth, creating jobs and increasing com-petitiveness
in particular for media. BCG estimates that
it should contribute to a total of US$4.2 trillion to the
G-20’s total GDP in 2016. This internet economy also
includes the media content industries, which employ
10.8 million people in the EU27. Average annual growth
rates for media content industries are higher than the
overall growth rates in the EU. The internet is grow-
4 The Future of Media Conference (2014) http://www.salford.ac.uk/spd/coursedetails?cou
rseid=THEFUTby85
ing and diversifying geographically, and the number
of internet users is expected to increase from 2 billion
to 5 billion by the end of the decade. Internet users
already spend 20–30% of their time online, mainly
engaging with media content. The media sector thus
differs significantly from other sectors and requires ap-propriate
policy making and regulation. In Europe, free
media is often considered a part of, and a prerequisite
for, democracy and quality of life.5
The UK’s creative industries are currently worth more
than GBP 36 billion per year. They generate GBP
70,000 every minute for the UK economy and employ
1.5 million people in the UK. These industries account
for around 10% of UK export revenue.6
5 EU Media Futures Forum Final Report (2012) http://ec.europa.eu/digital-agenda/sites/
digital-agenda/files/forum_final_report_en.pdf
6 EU Media Futures Forum Final Report (2012) http://ec.europa.eu/digital-agenda/sites/
digital-agenda/files/forum_final_report_en.pdf

2.
Industrial
Structure of the
Media Industry
According to the Institute for Media and Communica-tions
Policy 7, media corporations have bigger budgets
than some nation states. As agents and moderators of
globalization, they have economic and opinion-shaping
power. Technological progress and growing competi-tion
force media corporations to expand their busi-nesses
both nationally and internationally.
Globalization, deregulation, technological innovation
and the convergence of previously separate industries
such as media, entertainment, information, and con-sumer
electronics, have created a somewhat turbulent
media landscape8. As certain technological thresholds
have been crossed, industries that were previously
separate now intermingle, creating a new industrial
structure comprised of adjacent companies that must
compete and collaborate despite having fundamentally
different business models and industrial cultures.9 The
boundaries of several industries are shifting and merg-ing
together, and the segments are fighting to become
“primary gateways for content access, navigation and
provision”.10 As a consequence, many incumbent media
companies experience severe challenges, as content
proliferates, audience behaviors change, advertising
revenue erodes, and new competitors emerge. Some
competitors come from adjacent industries that have
significant cash reserves and R&D resources. Others
are tiny start-ups that may grow into a larger threat to
established players. The newspaper industry is a prime
example, with readers moving to online news and ad-vertising
revenue following.11
Cheap, ubiquitous ICT is eroding the benefits of scale
for traditional media companies as cost savings gen-erated
from centralized production and distribution
decline. Media firms operating in this rapidly chang-ing
environment have to adapt quickly to create or to
sustain their competitive advantage. For profit-oriented
entities such as media and entertainment companies,
the central question is how to create, deliver and cap-ture
value in the evolving landscape shaped by the ICT
revolution. Sections 2.1 and 2.2 investigate the changes
to the media value chain so far. Section 4 analyzes the
emerging value chains.
7 Media Data Base - International Media Corporations 2014, medialab.eu/en.html
8 Kranenburg, H.V., Ziggers, G.W. (2013) How Media Companies Should Create Value:
Innovation Centered Business Models and Dynamic Capabilities. Handbook of Social
Media Management. Springer.
9 EU Commission, 2012, The Digital Shift in the Media and Content Industries: Policy Brief
10 ibid
11 Duke, S., 2014, German giant who wants Google cut down to size. The Sunday Times,
21/09/2014

2.1
Value Chain
of the Traditional
Media Industry
Traditionally, from a consumer’s perspective, the
value proposition of the media industry comprises
the medium itself, as well as the product or service.12
A simplified traditional value chain can be comprised
of creation, production and distribution of content,
as illustrated in Figure 1.
The traditional value chain was linear – content was
created, e.g. a photographer took a photo or a journal-ist
wrote an article, creating a “first module copy” that
involved a significant amount of effort and cost. During
the production phase, bundling occurred, which placed
different content together to create the final market-ready
product, e.g. a newspaper or a radio playlist. The
distribution phase included everything related to the
distribution of content to consumers, which traditionally
required large infrastructure investments in the case of
TV and cable networks, or complex logistics operations
for music and newspapers to deliver the physical con-tent
to consumers: “Movies made money from tickets.
Bands made money from physical albums. Transactions
took place between hands or across a register. The
business model was a simple point of contact: Drive
consumers through the doors”. 13
Incumbents in the media industry originally applied
ICT in order to increase efficiency in these processes,
particularly with regard to bundling content. For more
than 150 years, “new communications technologies
have tended to concentrate and commercialize the
production and exchange of information, while extend-ing
the geographic and social reach of information
distribution networks”.14 With the development of the
internet, however, this concentration of power could be
challenged and new organizational forms for informa-tion
and entertainment could emerge. This is covered in
more detail in Section 4.
It is well understood that digital technologies have
affected the marginal costs of distribution within the
media industry. Once created, content in digital format
can be reproduced at very little cost and instantly
“shipped” to consumers over the internet. The internet
has not just led to an acceleration of the distribution
process, it has also led to a convergence of media, as
different media types (e.g., movies, music and print)
can now be distributed and consumed via the internet
and across multiple devices. ICT has therefore played
a significant role in shaping a new value chain. This is
covered in the next section.
Figure 1: Traditional Media Industry Value Chain
Creation Production Distribution Viewers
12 Hess, T., Matt, C. (2013). The Internet and the Value Chains of the Media Industry.
Media and Convergence Management. Springer
13 Thompson, D., 2014, The Future of Media will be Streamed, The Atlantic, April 10th 2014
14 Benkler, Y., 2006, The Wealth of Networks, Yale University Press

2.2
Impact of
Digital on Media
Value Chains
Due to social media and other digital communication
channels, media companies can actively integrate con-sumers
into their value creation processes. This allows
them to exploit consumers’ potential (usually at a very
low cost or even for free) to create additional value. In
the case of media companies, the integration can occur
at any of the three stages of the traditional value chain:
content creation, bundling and distribution.15 This is
illustrated in Figure 2.
Increased usage of ICT has led to a complex and dy-namic
process of “disintermediation”, as producers are
able to generate direct sales and creators can directly
distribute their work online. Telecom and IT players,
meanwhile, create a move towards “re-intermediation”,
allowing smaller companies that may not have large
marketing budgets to participate in the market.16
The most obvious examples are new forms of digitally
enabled intermediaries, such as Spotify and Apple
iTunes. Through access to closed digital music plat-forms,
they have captured part of the market traditionally
held by record companies. In particular, these platforms
allow end users to create their own “bundles” of music.
New aggregators enable TV consumers to decide what
they want to watch and pick-and-mix their own services.
Around 50% of consumers prefer this approach to the
traditional TV bundles.17 “This is leading to the evolution
toward a service model, where the consumer is buying
a service which happens to be linked to editorial content,
rather than buying a media product per se.” 18
e.g. GoPro and social interaction with traditional medium
Editing UCG
Figure 2: ICT and Current Media Value Chain
Creation Production Distribution Prosumers
Social networks
15 ibid
17 Ericsson Consumer Lab Report, 2014

2.3
Intermediaries
and Aggregation
New digital technologies have also helped create new
media aggregators, such as GoPro, which allows end
users to capture video and share it via the internet. Go-
Pro sees itself as a media company as well as a hard-ware
company. “On the GoPro channel on YouTube,
videos average about half a million viewers each.” 19
GoPro is therefore attempting to act as an intermediary
for the large number of professional and amateur users
of its equipment that tag their videos with “GoPro”.
The company often selects videos and edits them to
create a product that is more relevant for a particular
market. For those engaged in activities such as adven-ture
sports, The possibility of payment has also meant
a change in the experience of performing tricks and
stunts: recording and sharing them has become
a deeply embedded part of the experience itself.
“ When the agony of missing the shot trumps
the joy of the experience worth shooting, the
adventure athlete (climber, surfer, extreme skier)
reveals himself to be something else: a filmmaker,
a brand, a vessel for the creation of content.
He used to just do the thing—plan the killer trip
or trick and then complete it, with panache.
Maybe a photographer or film crew tagged along
… Now the purpose of the trip or trick is the
record of it. Life is footage.” 20
As is often the case with media technologies, GoPro
was the result of a confluence of different technolo-gies
reaching critical mass at the same time – small
enough camera technology met waterproofing and high
speed broadband. As will be discussed in Section 3,
increases in technical speeds and capacities now have
a direct impact on the media industry itself and the con-nections
between different parts of the value chain. The
fact that media and content are now often purely digital
products, rather than a combination of digital and physi-cal,
means that ICT has a fundamental role in the media
industry that it does not have in many others. The role
of ICT in the media industry continues to evolve. Sec-tion
3 covers some of the main thresholds of the media
industry in the digital age.
Rather than the simplistic notions of disintermediation
or re-intermediation, the media industry is experiencing
a two-fold interaction between:
1. The reallocation of costs across the industrial
structure. Some costs are disappearing, e.g. physi-cal
transportation. Some remain unaffected, e.g.
editing. And others are being introduced, e.g. soft-ware
security and digital rights management.21
2. The increasing importance of non-market and
non-proprietary content production22 through the
creation of dynamic strategic networks across
well-established internet technologies.
Section 4 presents three organizational archetypes in
media that emerge due to the interaction of ICT with the
different parts of the media value chain, as the business
models that have dominated the media and entertain-ment
industry over the past four decades are challenged
by new methods of creation, production and distribution.
19 Paumgarten, N., 2014, We are a Camera: Experience and Memory in the age of GoPro,
New Yorker, September 22nd, 2014
20 ibid
22 Benkler, Y., 2006, The Wealth of Networks, Yale University Press

3.
Media Industry
Thresholds
This section provides an overview of the main thresh-olds
in the media industry. Due to space limitations, we
have focused on those that are appropriate and ap-plicable
in global markets. Industrial boundaries help
define how economic actors are able to interact with
one another within an industrial structure.23 Thresholds
are associated with those boundaries, and once par-ticular
levels are crossed, the entire industrial structure
could be completely reformed, creating space for new
entrants and redefining the role of all economic actors
within it.
This section presents three main thresholds. Section 4
illustrates how these allow new organizational struc-tures
to form and compete with one another:
1. Bandwidth, connectivity and speed: Media is now
directly linked to ICT and its associated technical
capacities.
2. Media consumption patterns: The manner in which
media is consumed by end users is increasingly
important for the industrial structure, and can rap-idly
change it.
3. Financing mechanisms: How the industry receives
funding and pays for content reflects how much
money is available for content creation.
23 Mulligan, C.E.A., 2011, The Communications Industries in the Era of Convergence,
Routledge

3.1
Bandwidth,
Connectivity
and Speed
The role that mobile connectivity now plays in the media
industry – and society as a whole – cannot be under-stated.
Mobile connectivity has increased dramatically
around the world over the past decade. It is predicted
that there will be 9.2 billion active mobile subscriptions
by 2019, illustrated in Figure 3.
2.6 billion of these will be on LTE networks, providing
high-speed and seamless video access for end users,
illustrated in Figures 4 and 5.
The majority of that traffic will be video, as illustrated in
Figure 5. While connectivity provides an illustration of
how many people can access the internet, a closely re-lated
threshold is bandwidth. Bandwidth can be under-stood
as the total distribution capability of the industry,
but is more commonly understood as the data capabil-ity
of online mechanisms. Bandwidth in the context of
media is split into uplink and downlink:
> Downlink speeds are closely related to the types of
content an end user will consume while using their
mobile device.
> Uplink speeds relate to how end users are able to
contribute content and the distribution network
forms they are able to connect to.
Both of these thresholds are heavily dependent on
subscription pricing.
Figure 3: Fixed and mobile subscriptions 2010–2019 Figure 4: Mobile subscriptions by technology. Source: Ericsson
Mobile subscriptions
Mobile broadband subscriptions
Fixed broadband subscriptions
Mobile PCs, tablets and mobile
router subscriptions
SUBSCRIPTIONS/LINES (BILLION)
Fixed and Mobile subscriptions
2010 – 2019
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
10
9
8
7
6
5
4
3
2
1
0
Mobile subscriptions by technology
2010 – 2019
6.7 billion
mobile
subscriptions
9.2 billion
mobile
subscriptions
LTE/HSPA/GSM and LTE/CDMA
HSPA/GSM
GSM/EDGE - only
TD-SCDMA/GSM
CDMA - only
M2M subscriptions not included
MOBILE SUBSCRIPTIONS (BILLION)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
10
9
8
7
6
5
4
3
2
1
0

In 2013, video
accounted for ~40%
of mobile traffic
Segment
File sharing
Video
3.1 BANDWIDTH, CONNECTIVITY AND SPEED
Social networking
accounted for more
than 10% of mobile
data traffic in 2013
and will have the
same share in 2019
Audio
Web browsing
Social networking
Software download and update
Other encrypted
Other
Mobile application traffic outlook
2013 and 2019
2019
2013
Figure 5: Mobile Application Traffic Outlook 2013 and 2018
The continued drive towards mobility will have an
impact on the media industry as customers become
increasingly demanding about accessibility of content
on a variety of devices over a variety of access network
technologies. For example, consumers will expect to
access the same content and media streams irrespec-tive
of whether they are using radio, cable or fixed net-work
technology, and they will want the switchover to
be seamless. Consumers increasingly expect the same
content to be accessible whether they are watching a
TV, a laptop or “on the go”. They also expect to be able
to move media between these devices as they move
around, which places increasing pressure on network
media solutions to manage handovers effectively.24

Display pixels (’000)
App processor (Giga-operations per second)
Modern downlink bitrate (Mbps)
Figure 6: Increases in Mobile Device Capabilities
Increases in mobile device
capabilities
1995 2000 2005 2010 2015
1,000
100
10
1
0,1
0,01
Figure 7: Social networking sites or apps used by those with a current social
networking profile by age: 2013
Total Aged 16 – 24 Aged 25 – 34 Aged 35 – 44 Aged 45 – 54 Aged 55+
14
4 6
2 1
4 5
6
9
42
29 28
2423
17
22
20
31
33
36
22
3
6
7
9
16
8 8
99
9897
96
9494
12
9
12
15
17
1514
21
21
21
21
181918 21
15
17
5 4
2
5
7
3
5 5
Facebook Twitter YouTube Whats App Google+ Instagram Linkedin SnapChat MySpace Flickr
8
DATA SOURCE: OfCom Media Use and Attitudes Report 2014
Figure 8: Frequency of site visits on mobile device, delta 2012-2013
At least quarterly Less often
34
45
6
39
5
29
2012 2013
83
66
50
42
14
3
1 2
1
6
7
10
2
8
11
31
22
6
16
36
5
31
8
42
6
59
51
8
43
5
74
7
67
78
2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013
Total Aged 16 – 24 Aged 25 – 34 Aged 35 – 44 Aged 45 – 54 Aged 55 – 64 Aged 65+
100%
80%
60%
40%
20%
0%
DATA SOURCE: OfCom Media Use and Attitudes Report 2014
3.1 BANDWIDTH, CONNECTIVITY AND SPEED
One of the most important thresholds in the media
industry is therefore speed and other capabilities of
mobile devices, and the rate at which they are in-creasing.
Some are illustrated in Figure 6. Today’s
smartphones have more computing power, higher-resolution
displays and can handle greater bandwidth.
This increases the possibility for end users to use their
mobile devices for content generation. Technology
companies will increase in importance within the me-dia
industry as the way something is made and distrib-uted
becomes just as important as the content and the
medium it is transmitted across.
As processing speeds continue to increase, it is likely
that mobile devices will become editing tools as well
as content creation devices. This gives the potential to
deeply embed the end user in all aspects of content
creation and production processes. Social media also
enable end users to participate in the media distribu-tion
processes. As these technologies and communi-cation
methods become more commonplace, we can
expect yet another reshaping of the structure of the
media industry. The speeds and capacity of ICT will
also have a flow-on effect to suppliers as the ability to
provide content, in addition to connectivity, becomes a
deciding factor for consumers: “internet subscriptions
are increasingly being selected based on the content
offered by the provider.” 25
With high fixed and mobile broadband penetration
rates, “the web has become a fully realized consumer
medium where pages load in a flash and video plays
without stuttering. With those pipes now built, we are
in a time very similar to the early 1980s, when big cities
were finally wired for cable. What followed was an
explosion of new channels, many of which have
become big businesses today.” 26
25 Blankenhorn, D., 2014, AT&T wants what Comcast has and it’s not broadand wires,
The Street, 23rd September 2014
26 Carr, D., 2014, Ezra Klein Is Joining Vox Media as Web Journalism Asserts Itself, NY
times, Jan 26, 2014

3.2
Consumption
As important as ICT and the associated speeds and
rates of change is the changing manner in which
people consume media. For example, there has been
a dramatic increase in the number of people using
mobile devices to consume video and create content in
addition to accessing social media: “Four in ten mo-bile
users have used mobile phones to put photos or
videos on sites like YouTube, while two-thirds (66%) of
online adults say they have a current social networking
site profile, unchanged since 2012 (64%)… Three in ten
social networkers say they have a Twitter profile, and
one in five say they have a YouTube (22%) or Whats-
App profile (20%). Social networking overall remains a
popular activity with 60% of users visiting sites more
than once a day, an increase from 50% in 2012, and
with 83% of 16-24s doing so (69% in 2012).” 27
As discussed, an increasing number of non-English
speakers are now accessing media industries via the
internet. A key factor for increasing consumption is to
make it available to more end users. Content and chan-nel
providers may seek increased audiences through
advances in translation: “within a few years, the Inter-net
will offer simultaneous interpretation of audio and
video, making all sorts of media content accessible to
new audiences”.28
27 Ofcom (2014) Adults’ Media Use and Attitudes Report. Research Document April 2014 28 Pfanner, E. (2013) Peering Into the Future of Media, NY Times, Oct 14, 2013

3.3
Financing
Funding for media has traditionally come from four
main sources: 29
> State aid
> Advertising and sponsorship
> Donations
> Individual subscriptions
All modes of finance create a sense of loyalty or binding
to those providing the funding (even where any control
over editorial freedom is expressly precluded in law)
and can therefore influence coverage. According to
Lowe & Berg (2013) 30 in an empirical study on European
Union member countries, the four modes could be
categorized as follows:
> License fees
> Direct subsidy
> Subscription or pay-per view
> Advertising
Table 1: Regular Media Activities by Age: 2013
Watch television
Use a mobile phone
Go online (via PC/laptop/
netbook/tablet
Listen to the radio
Read newspapers/magazines
Watch videos/DVDs/Blu-rays
Listen to music device/CD
tape player
Listen to portablemusic device/
MP3 player
Play console/computer games
Use a portable media player
2013
Total 16 – 24 25 – 34 35 – 44 45 – 54 55 – 64 65 – 74 75+
96%
85%
75%
70%
66%
55%
44%
30%
26%
17%
91%
95%
87%
56%
50%
68%
40%
61%
53%
31%
94%
95%
81%
66%
61%
63%
41%
34%
39%
25%
95%
64%
87%
72%
66%
63%
45%
35%
27%
20%
96%
89%
85%
76%
65%
53%
46%
29%
21%
15%
99%
83%
71%
76%
76%
47%
52%
18%
11%
10%
99%
71%
50%
73%
75%
46%
42%
10%
6%
3%
98%
46%
25%
76%
76%
26%
30%
4%
1%
2%
DATA SOURCE: OfCom Media Use and Attitudes Report 2014.
Only license fee payments and subscription or pay-per
services are transparent modes of funding. In countries
with advertising-supported media or direct subsidy,
defined here as allocation from general tax revenue
as in the Netherlands and Spain, people cannot easily
know how much their media system costs.
This report focuses on funding for privately owned
media companies, namely:
1. Advertising
2. Intellectual property and release windows
3. Subscriptions
29 Psychogiopoulou, E. (2014) Media Policies Revisited: The Challenge for Media
Freedom and Independence. Palgrave McMillan UK.
30 Lowe, G., Berg. C.E. (2013) The Funding of Public Service Media: A Matter of Value and
Values International Journal on Media Management. 15(2) PP 77-97

3.3.1
Advertising
The most common business model for both traditional
and “digital” media has been advertising.31 For exam-ple,
Universal backed a start-up, SpiralFrog, whose
business model is based on allowing customers to
download songs under copyright for free, with advertis-ing
as the sole source of revenue. Google, meanwhile,
has used advertising to develop perhaps the most
successful model in the current digital economy. The
value of TV advertising in the USA was estimated at
US$74 billion by Standard & Poor’s in 2007 32, whereas
subscription revenue streams were estimated at US$75
billion by Standard & Poor’s in 2007. 33
Advertising remains a key element in the business mod-els
of media companies – it represents a fundamental
link between private entities and consumers. As a con-sequence,
advertising remains a vital revenue stream
for media companies. Digital technologies create both
new opportunities and challenges for the advertising
model. Innovative tracking technologies enable detailed
understanding of end users, paving the way for interac-tive
communication. Technologies such as Siri, Apple’s
voice-controlled assistant application could, for exam-ple,
enable end users to “converse” with ads.
Advertising revenues also face specific challenges in
the new landscape, as audiences adopt digital video
recording devices to access their preferred content at a
time of their choosing. These devices allow audiences
to eliminate advertising, and thus have the potential
to affect advertising revenue streams. More than 50%
of respondents in a survey about media habits indi-cated
that removing commercials is very important,
and almost 30% were willing to pay to remove them.
Consumers also wanted the ability to opt in or out of
advertising.34
At the same time, such devices allow consumerori-ented
companies to communicate with their customers
and also develop deep understanding of aggregated
demand for different content.
In traditional advertising research, the main focus
has been on consumer attitudes and behaviors.35
This was also initially the case with online advertising
research, which focused on issues such as attitudes
and behaviors towards ads, medium reliability, product
involvement and website context congruity. Over time,
the focus in online advertising research has shifted to
issues of advertising effectiveness, such as attention,
displayed advertising formats and visual design is-sues.
Online ad pricing is often based on placement,
document arrangement, frequency and size. Other
transaction-based measures to determine online ad
effectiveness include click-through rates, registrations
and purchases.36
31 Sigismondi, P. (2011) The Digital Glocalization of Entertainment. New Paradigms in the
21st Century Global Mediascape. Springer
32 Amobi, T.N., Donald, W. (2007) Broadcasting, cable and satellite. Standard & Poor’s
industry surveys. McGraw-Hill, New York
33 ibid
34 Ericsson Consumer Lab Report, TV and Media 2014
35 Michailidou, E., Christoforou, C., Zaphiris. P. (2014) Towards Predicting Ad Effective-ness
via an Eye Tracking Study. HCIB Springer International Publishing Switzerland
36 ibid

3.3.2
ICT and
Cross-Media
Advertising
In the current digital media market, companies’ adver-tising
strategies have moved from single media plat-form
to cross-media advertising. Convergence within
the media industry presents advertisers with complex
challenges. Target groups are fragmented because
of the enormous growth in media outlets. Consumers
are less attentive because of media multitasking, and
more selective because of interactive and “on demand”
media options, making it easier than ever to avoid ad-vertising.
It is therefore increasingly difficult for market-ers
to reach their target groups and attract attention to
their messages.37
Cross-media advertising, where several different media
are used to communicate related brand content, is one
way advertisers have responded to these challenges.
In cross-media campaigns, advertisers seek to maxi-mize
the effectiveness of their budgets by exploiting the
unique strengths of each medium and taking advantage
of cross-media synergies:38 “Old media planning was
about picking individual media. New media planning is
about picking combinations of media.” One of the big-gest
questions in cross-media advertising is how each
medium can enhance the effect of the other media.
The degree to which brands use different media in their
campaigns varies. A study by Klausch et al. (2010) into
the share and composition of 2,569 campaigns in the
Netherlands showed that about 40% were cross-media
campaigns. Around 33% of these campaigns used two
media, 17% used three and 7% used four. The remain-der
used more than four media.
37 Voorveld, H., Smit, E., Neijens, P. (2013) Cross-media Advertising: Brand Promotion in
an Age of Media Convergence. Media and Convergence Management. Springer
38 ibid

3.3.4
Nature of
Media Advertising
in the Digital Era
Media economist Robert Picard argued in 2003 that the
traditional media needed to prepare for the ‘‘gradual
erosion’’ of their financial base because of new media
pressures and declining advertising revenue. In fact,
newspaper advertising revenues have dropped by an
estimated 23% over the last two years.39 The current
economic climate is partly responsible for this decline,
though Forrester Research predicts a long-term adver-tising
shift toward social and interactive media.40
According to Wagler (2013)41, more than US$ 119
billion was spent on digital advertising in 2010. Spend-ing
on interactive advertising is projected to near US$
77 billion by 2016, representing 35% of all advertis-ing
in the USA. Interactive media is rapidly changing
the media landscape and challenging the advertising
industry to develop effective means of communication
in a fragmented media environment. Advertising has a
long history of working with traditional print, radio, and
television. Agencies are now defining and exploring
new approaches for creative applications using the vast
number of interactive media channels now available.
39 Project for Excellence in Journalism, 2009
40 Kurpius, D., Metzgar, E.T., Rowley, K.M. (2010) SUSTAINING HYPERLOCAL MEDIA.
Journalism Studies 11(3), PP 359-376
41 Wagler, A. (2013) Embracing Change: Exploring How Creative Professionals use
Interactive Media in Advertising Campaigns. Journal of Interactive Advertising 13(2) pp.
118–127

3.4
Intellectual
Property
In an analogue world, the exploitation of intellectual
property under copyright stems from carefully planned
distribution through subsequent, often exclusive, “re-lease
windows”. These allow content owners to apply
price discrimination across a variety of distribution
mechanisms for content, e.g. film, DVD and broadcast
TV. Digital technologies have the potential to disrupt
this mechanism.
Distribution via different digital platforms makes it
possible to replicate the timing of release windows,
from cinemas to free-TV networks. Digital distribution
methods therefore provide a parallel shelf life for enter-tainment
content, generating potentially new revenue
streams. The timeframes for different media are out-lined
in Table 2.
Table 2: Release Window Timeframes – Adapted from Sigismondi 2011 42
Distribution
method
Theatre
Home
entertainment
VOD/PPV
Pay-TV
Free TV Network
Timeframe
Initial release, lasting 3 – 6 months
3 – 6 months after theatre
8 months after theatre release
Subsequent
windows
Basic cable, Pay-TV
and Free TV second window
42 Sigismondi, P. (2011) The Digital Glocalization of Entertainment. New Paradigms
in the 21st Century Global Mediascape. Springer
The duration of release windows evolves over time.
ICT allows new parallel distribution mechanisms and
enables rapid distribution of pirated content. The cur-rent
entertainment industry business model, based
on release windows, is changing and may ultimately
cease to exist as a result of ICT. In particular, view-ers
often choose to watch larger portions of a series
in one sitting,43 not one episode per week as was the
tradition before streaming services. One survey found
that: “although 77 percent of people watch scheduled
broadcast TV, almost as many watch streamed video
several times a week or more, at 75%. A lot of recorded
and physical media viewing is shifting towards easy-to-use,
convenient streaming, using on-demand services
that allow cross-platform access to content”.44
43 Media Vision 2020, Ericsson

3.5
Subscription
Fees
Other revenue streams for media and entertainment en-tities
stem mainly from subscription fees collected from
consumers, usually on a monthly or on-demand basis
for entertainment content from different platforms.
A mixed business model is often utilized, combining
advertising revenues with subscription fees, as is often
the case for cable or satellite TV channels.
A 2006 survey of executives conducted by the Econo-mist
Intelligence Unit within the IBM institute for Busi-ness
Value revealed that on-demand subscription and
entertainment content rental were deemed the most
significant future revenue streams for telecom, network,
and multiple system operators. Network executives
believed advertising would still play a pivotal role.
But there is another side to the story: “Studies also
show a rise in ‘cord cutting’ — that is, cancellations
of pay-TV subscriptions — by American households.
Instead of watching scheduled channels, more people
are using on-demand services like Netflix, or simply do-ing
without TV, as they log longer hours on the Internet.
Television, in other words, is starting to look more like
the Internet, even as the Internet starts to look more like
TV”.45 Content is now available anytime, anywhere.
With regard to industrial structure, a number of different
forms of finance are possible, including:
> Reallocation, e.g. from traditional television
to online, or from cinema to online distribution.
> Role, e.g. whether the funder has control or interest
in the content and how that control or interest is
manifested.
> Redistribution, e.g. consumer consumption pat-terns
affect how media budgets are allocated.
45 Pfanner, E., 2013, Peering Into the Future of Media, NY Times, Oct 14, 2013

3.6
Regulatory
Aspects
The regulation of the media industry is extremely com-plex.
This section provides a brief overview of some of
the major issues facing the industry in the digital era.
Due to convergence, the regulatory environment also
affects competitiveness in addition to business models
from different sectors. Regulations for different indus-tries
affect the disintermediation or reintermediation
prospects of not just companies and sectors, but entire
regions. Google and other USA-based companies, for
example, work under privacy laws that allow them to
collect, collate and use data about individuals because
they are regulated as IT companies. Telecommunica-tions
providers, however, are unable to use their data
in the same manner. A regulatory battle is therefore
emerging between:
1. Regions, e.g. the USA and the EU
2. Sectors, e.g. telecommunications, IT and media
regulation
Communication laws and regulations have to be amend-ed
in order to cope with converged services. Conver-gence
is leading to the development of inter-industry
segments within the media industry, as illustrated by the
difficulties Google is currently facing in the EU regarding
“the right to be forgotten”. Many in Europe view Google
as a media company46, rather than solely a technology
company.
46 Duke, S., 2014, German giant who wants Google cut down to size. The Sunday Times,
21/09/2014
According to Liu (2013)47, US communication laws
and regulations are applied according to a silo model
(sector-specific regulation), while the EU has adopted
a horizontal or layer model for regulations. While the
impact of ICT is global, there are significant issues
around how individuals, nations and regions define
themselves and how they control and access media.
In oligopolistic and monopolistic markets, where bar-gaining
power is shifted towards manufacturers, bun-dling
can become an abuse of market power due to
the limited choices available to consumers. New ques-tions
therefore emerge. Does Google’s dominance of
search markets in Europe constitute a monopoly, and
should anti-trust apply? Does Google’s use of filters
and “bubbling” protect the interests of end users, or
does it damage companies’ abilities to market them-selves
properly if an algorithm downgrades their rank-ings
or removes them altogether? At what point does
an aggregator need anti-trust regulations?
In addition, advertising regulations affect the forms of
advertising adopted online as well as in the environ-ment
of television and other media.48 A study found that
the UK and China, for example, applied less regulation
to some forms of advertising than Germany and the
USA, and that advertising markets differed as a result.
Against this, it was noted that there is increasing homo-geneity
of regulation across markets, mainly because
of the nature of technology and the global potential of
online experiences.49 Regulation is therefore intimately
linked to ICT in the media industry.
47 Liu, Yu-Li. (2013). Convergence in the digital age. Telecommunications Policy, 37(8),
61–614
48 Esposito, M., Kennon, O., Mohammed, M. (2013) Brand Funded Media, MBus Thesis,
Manchester Business School, 2013.
49 ibid

3.6 REGULATORY ASPECTS
With increasing mobility and increasing access to con-tent
via mobile devices, many customers now expect
access to the same content while travelling as when
at home. This also creates regulatory issues, such as
the question of cross-border licenses for streaming
services. Previously, when an end user purchased a
music CD, they were able to take it with them and listen
to it on a portable media device. Today, however, many
streaming services are not available to roaming travel-ers.
For example, a music subscription in one country
may not work while visiting another. Within the EU,
therefore, “record companies and authors’ collecting
societies agreed to provide multi-territory “one-click
micro-licenses” for small scale use of music online,
which would make it much easier for those who wish
to use music to do so with legal certainty on their own
websites or when posting videos on other sites”. 50
50 Euractiv, 2014, TV, film industry pledge easier cross-border copyright, euractiv.com

4.
Industrial
Disruption
in Media
Each of the thresholds presented in Section 3 is subject
to adaptation and change. As a result of the disruptive
elements of ICT over the past decade or so, the media
industry has been reshaped.
This process is continuing, however, and a “confluence
of technical and economic changes is now altering the
way we produce and exchange information, knowledge,
and culture.” This is actually leading to new organiza-tional
forms. Multiple value chains are emerging within
the media industry that relate to:
1. How power is distributed between economic actors
2. How content is created and paid for
3. How the media production and distribution
elements are financed
This section outlines three forms of media value
chain that digital technologies have helped enable
in the media industry:
1. Authoritarian/Unilateral
2. Entrepreneurial/Distributed
3. Democratic/Inclusive
These illustrate different roles that actors may play
within the structures of the industry.
The following descriptions present several views of how
ICT may be applied for the development and distribution
of media. ICT is solely an enabler of these organizational
structures. They are presented here from both perspec-tives
without value judgements.

4.1
Authoritarian
/Unilateral
“ With great power vast quantities of
data comes great responsibility.”
Eli Pariser
This organizational structure first applied in the 1800s,
most closely represents that of broadcast TV. Media
that operate under the authoritarian model can be
either privately or publicly owned. Until the 1850s,
publishing presses in Europe were privately owned and
the aristocracy – wanting control over what was printed
about them – exercised financial and political power
to regulate what could be printed. This model is still in
operation in many countries today, where governments
control what is printed and broadcast, and even who
has access to the internet. It is a traditional model of
media that in many economies has allowed groups of
commercial interests to fund media through advertis-ing
or sponsorship, but not to control content without
formally changing the designation of that content, e.g.
from a TV show to an advertisement (see Esposito et
al., 2013). This is illustrated in Figure 9.
Figure 9: Authoritarian/Unilateral
Content Creation
and Distribution
The role of ICT within the media industry today raises
some challenging questions about how algorithms may
inadvertently create authoritarian-style or unilateral
structures within the media industry.
An example of this is the “filtering” or “filter bubbles” 52
used by search and news engines. End user data is
interpreted by an algorithm, and the engine presents
information that it “thinks” is most relevant to each
user. Information may be tailored to the user’s region,
registered hobbies or job description. Examples of this
exist today in Google’s search or Facebook’s selec-tive
displaying of friends’ updates, in particular for their
advertising requirements.
52 Pariser, E. (2011) The Filter Bubble: What the internet is hiding from you, Penguin Books

4.1 AUTHORITARIAN/UNILATERAL
Another example is Yahoo’s personalization algorithm,
which generates 45,000 totally unique versions of the
Today module every five minutes.53 This algorithm
makes it four times as likely that an individual will click
on a link compared with traditional online editorial
processes. As an example, it “might decide to serve up
a particular package to women in the 35-44 age range
in Peoria, for example, but not to men in that same age
range in Peoria, or women in the 21-24 age range in
Seattle” 54. Yahoo is also implementing this algorithm
in its news feed, which means it will have a degree of
control over what news an end user is presented with,
despite human editors being involved in the final selec-tion
process for news feeds.
There is no doubt that these types of filters make the
internet more efficient and can help individuals and end
users find the information they are looking for more
quickly. However, it effectively provides a form of digi-tally
enabled authoritarian control over the media indus-try.
While it is currently used to direct people’s interest
to articles they will find interesting, it could also be used
to direct sentiment, e.g. regarding a war or a particular
court case. The reason that this falls under the authori-tarian
model is that it removes control from the end user
– who may not even realize what has happened.
53 Boyd, E., 2011, Brains and Bots Deep Inside Yahoo’s CORE grab a billion clicks, Fast
Company, Aug. 1 2011
54 ibid
Therefore media corporations may be able to execute
significant control over what an end user sees in their
news feed. While it is unlikely that any of today’s search
engines would execute authoritarian control over
search results or adapt news sources, the possibility
emerges due to the application of ICT.
It is not only technology companies that may apply
ICT to establish control over media content. Recent
changes have been propagated in the online environ-ment
where instead of maintaining only indirect control
of content, commercial interests have sought to better
control content or to take a larger stake in the value of
media programming. For example, commercial brands
have become investors in online programming such as
drama productions and human interest and advisory
shows, as well as taking stakes in app and game de-velopment.
Several companies have even started their
own news outlets, e.g. GE Reports55, which provides
reports on science and innovation.
55 GE Reports, available at: http://www.gereports.com/about

4.2
Entrepreneurial
/Distributed
The ICT revolution has placed cheap and powerful
computational capacity into the hands of many people
around the globe. An outcome of this is that the physi-cal
capital for the creation and production of content is
broadly distributed throughout society, as is the power
over the creation, production and distribution of media.
This is illustrated in Figure 10. Anyone who wishes to
create and share his or her own content it is therefore
able to do so – if not alone, then at least in cooperation
with others.57 Networks of individuals can now work
together to generate content for one another, increasing
the role of non-market and non-proprietary production.
“ The change brought about by the
networked information environment
is deep. It is structural. It goes to
the very foundations of how liberal
markets and liberal democracies
have coevolved for almost two
centuries.”
Benkler, 2006 56
Connector Node/Member
Network Member
Figure 10: Entrepreneurial/Distributed
56 Benkler, Y. (2006) The Wealth of Networks, Yale University Press 57 ibid

4.2 ENTREPRENEURIAL/DISTRIBUTED
YouTube is one example of this. Terrorist organizations
are also able to utilize readily available ICT to cheaply
and easily create and distribute content.58 McLuhan’s
anticipated “global village” of contest and conflict has
come true thanks to the availability of ICT. 59, 60
One of the key aspects of this model is that it is often
based on social networks. While anyone may be able
to create and release content for distribution, the real
power in such networks is with the “connector nodes”
– people who can straddle the boundary between
two or more networks and exercise influence over
both. These connector nodes become very lucrative
in a networked society, as they are the points at which
networks can disseminate knowledge and content
between one another. It is likely that advertisers will
want to identify and understand these nodes in social
networks because of the number of connections they
have access to. These aspects of power are already
58 Malik et al, 2014, Isis in duel with Twitter and YouTube to spread extremist propaganda,
Guardian, 24th September 2014
59 McLuhan, M. (1962) The Gutenberg galaxy: The making of typographic man, London:
Routledge & Kegan Paul.
60 McLuhan, M. (1964) Understanding media, New York: Signet Books.
understood within the media industry, as can be seen
in LinkedIn’s “Influencer” title or Klout’s Social media
scores. These connector nodes provide dissemination
points that will allow advertisers or content developers
to quickly develop “market reach”. “ICT enables new
forms of production and exchange based on these
networks that will now co-exist and play a much larger
role, alongside property- and market-based produc-tion,
than they ever have in modern democracies.” 61
As opposed to traditional mass media technologies
such as TV, radio and print, new media is a disparate
set of technological platforms that are deeply inter-woven
into the social fabric of their user communities
(be it YouTube, Facebook, Twitter, Instagram, Pinterest
or a slew of others), giving rise to fundamentally and
functionally distinct attention structures. As a result, a
number of new types of media companies now classify
their work as “digital journalism”.
61 Pariser, E. (2011) The Filter Bubble: What the internet is hiding from you, Penguin Books

4.3
Democratic
/Inclusive
Perhaps the most commonly recognized and under-stood
organizational structure of the digital media
industry is the democratic/inclusive model. This covers
the use of ICT, and in particular social media, to create
two-way communication between the creators of infor-mation
and the consumers. In order to exercise power
within this sort of structure, input is required from as
many people as possible so as to effectively represent
the overall wishes of the population in question. This is
illustrated in Figure 11. An example is Netflix, which
uses information gathered from all of its end users in
order to create content. 62, 63, 64
The UK radio station BBC Radio 1 uses this organiza-tional
structure effectively to help create its playlists.
For example, during playlist creation meetings, “the
Figure 11: Democratic Structure in Media
Content Creation
and Curation
62 Ericsson, 2014 The Impact of Datafication on Strategic Landscapes
63 Maull, R., Godsiff, P., Mulligan, C.E.A. “The Impact of Datafication on Service Sys-tems,”
System Sciences (HICSS), 2014 47th Hawaii International Conference on, vol.,
no., pp.1193, 1201, 6-9 Jan. 2014
64 Lycett, M. (2013) ‘Datafication’: making sense of (big) data in a complex world. EJIS
22(4): 381-386 (2013)
artist’s YouTube views, Soundcloud hits, Shazam rat-ings,
Twitter followers and Facebook likes” are tallied
as an important input from the target audience.65 This
is combined with traditional market research: “we’ve
got a panel of thousands of young people from the age
of 12 to 29 in our overall research group, and we pay a
research company to test 400 of them every week.”
To some extent, this is a response to the younger gen-eration’s
methods of connecting with content – which is
heavily digital and smartphone-based. Radio 1 is there-fore
augmenting its traditional broadcasts with a You-
Tube channel and a BBC iPlayer channel, which allows
it to get more detailed information about which songs
and bands generate most interest among listeners.
These types of initiatives by media and content
companies cause another shift in the power distribution
of the music industry: “the internet has diminished the
power of pluggers in favor of stats about an artist’s
online popularity. There’s more music out there than
there’s ever been because it’s cheaper to produce and
distribute.” 66 The result is that it becomes the artist’s
responsibility, rather then the record label’s, to develop
a digital media following through channels such as
YouTube and Twitter.
One outcome of this form of organizational structure
is the development of multi-channel networks (MCNs),
“which function as new media’s answer to Hollywood
studios, giving independent creators a host of market-ing,
growth, and other business offerings in exchange
for a percentage of their advertising revenue”. 67
65 Khomami, N. (2014) Radio 1’s playlist
66 Khomami, N. (2014) Radio 1’s playlist secrets uncovered: the battle of the ‘brands’,
The Observer, 25 May 2014
67 http://www.buzzfeed.com/hillaryreinsberg/old-media-is-buying-up-the-biggest-you-tube-
networks?utm_term=4ldqpia#vgjop8

5.
Conclusions
The media industry is one of the fastest-changing and
most dynamic industries in the world. The industry’s
experiences of the convergence of technology, business
models and regulation predict the likely impact of ICT
on many other industries. Media has often acted as an
early indicator of how industries will adapt to changes in
consumer behavior resulting from new technologies.
Early ICT adoption by the media industry focused
on productivity and efficiency improvements for well-established
processes and a well-defined value chain,
with an understood distribution of costs and profits.
As technologies have converged, bringing new ways
to create, produce and distribute content, the industry
has had to adapt to rapid changes in end users’ tastes
and preferred access methods. And whereas end users
have long been accustomed to a relatively stable selec-tion
of media outlets — film, TV, DVD, radio — they now
have access to a vast range of media and a plethora of
devices on which to access them.
UGC is now well established even within video creation
as cheaper bandwidth and higher processing capacity
in mobile devices means that many more of life’s mo-ments
can be captured and shared with others.
The media industry and the mobile communications
and technology industries are now closely intertwined,
reinforcing the fundamental role of ICT. It is not possible
to discuss the media industry without discussing the
impact of ICT.
At the same time, ICT creates new possibilities for
redistribution of power across the media industry. End
users have access to powerful technology that enables
them to create networks for creation and distribution
of content. These networks often have global reach
and utilize social media outlets as distribution mecha-nisms.
ICT has virtually removed the entry barriers to
the media industry. However, a key issue for the digital
media industry is to improve the quality and reliability
of information within such networks.
An important development within the media industry
has been the creation of aggregators – websites or
software that pull together different types of informa-tion
and content for end users. These them to create
their own bundles instead of relying on a company to
do it for them.
ICT has already contributed to the evolution of three
organizational forms – Authoritarian/Unilateral, Entre-preneurial/
Distributed and Democratic/Inclusive. These
represent different ways that ICT has been applied
within the media industry to exercise power over con-tent
and distribution. The application of ICT in such a
broad variety of forms perhaps reflects the complexity
of humanity and our increasing interdependence in a
rapidly changing world.

Horizon Scan: ICT and the Future of Media

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