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Australia - Digital Media - Online Media Industry

This annual report offers a wealth of information on the industry behind the various developments of digital media in terms of information, communication and entertainment. The report includes analyses, statistics, forecasts and trends. It provides a comprehensive insight into the progress of the Online Media Industry and examines the key issues and opportunities.

  Subjects covered include:

  • The role of the different sectors (TV, Radio, Newspapers, telecoms, ISPs; Developments in the online video and DVD rental market; The Film and video producers; Analysis of the various activities from the broadcasters; Overview of the activities of the telcos and ISPs as media players; Overview and analyses of all the major players in the industry; Overview and analysis of the mobile media market; Home network market - developments and statistics. 
  • Researcher:-Paul Budde, Kylie Wansink

Most of the media companies have a vested interest in protecting their traditional businesses. Over the last 50 years they have been able to obtain certain political advantages that have allowed them to carve out monopolistic markets.

  The new digital media are undermining the traditional media’s privileges and their grip on their monopolies. They are now all jockeying for a position in the new Internet economy. Sectors include TV and radio broadcasting, newspaper publishers, film and video industries. The traditional industry has turned the corner and is now well and truly on course to dominate the digital media market, launching events using their traditional media and supplementing them through new media activities.

  The more adventurous traditional media firms, (Seven, Nine and the ABC) made early attempts to gain market share in the digital media space, and publicly funded organisations like the ABC and SBS are now gaining market share amongst digital viewers.  

Quality content is crucial as digital platforms are becoming relatively commoditised. Telcos tried to claim this territory but continue to struggle to leverage their natural advantages.

  Alongside the ABC and News, Fairfax Digital has continued to compete for digital viewers. Other players include Lachlan Murdoch, News Limited, Ten, Macquarie Southern Cross Media, WIN and Austereo.

  However, they are increasingly being faced with more competition from overseas media companies.

  In terms of advertising and marketing in the digital media era the traditional media companies have made quantum leaps in comparison with the telcos. While the Internet companies like Google have clearly been the leaders to date, media companies are now also making great progress.

  New advertising models, permission-based marketing and premium sales activities are being used to attract people to events and services. New video applications are emerging as the Internet media companies seek to exploit the added speed and capacity of broadband infrastructure.

  The most significant driver behind these developments has been the arrival of broadband. This has opened up consumer markets. For decades only corporate users have been able to afford data services.

  The Internet quickly used this new data development to create an enormous number of consumer applications. Broadband improved the quality by allowing for video-based applications; and, just as importantly, it has made access to digital media affordable to the mass market.

  The other technology driver in the market has been mobile. There is no doubt that mobile data applications have caught the attention of the media, but after nearly ten years less than 5% of mobile revenue is being generated by services other than voice or SMS.

  The business models used by operators are definitely not working for mobile media. The operators’ own portals are not delivering the services customers want at a price customers are prepared to pay.  

Interestingly, straightforward mobile data traffic has increased significantly.

  Operators are making far more money from traffic (capped data packages) than they are from content. This might result in them finally changing their closed business models. However, there is a limit to the mobile networks’ spectrum capacity, and we will have to wait for true IP-based wireless broadband to become available before the operators can fully deliver on the promise of mobile data.

  The dynamics of converging markets and technologies is bringing sweeping changes to the telecommunications, entertainment, video and multimedia markets, characterised by expanding product/services developments.

  At the heart of a digital home is the technical concept known as the media centre. This combines voice, video and data applications and includes VoIP, broadband TV, digital video recorders (DVR or PVR), home networking, CD and DVD playback and MP3.

  Cable TV operators, telcos, consumer electronics and IT companies are all competing for the media centre business in the digital home. The initial business model to deliver these integrated products is know as a triple play model, according to which voice, video and data applications are all delivered over one single access subscription. However, this telco-driven approach is rapidly being overtaken by the business models introduced by the Internet media companies.

  Home networking, in a broader sense, is migrating beyond its PC-centric beginnings to incorporate a variety of consumer electronics devices, from digital TVs, to multi-room DVRs, digital media adapters, energy management devices, set-top boxes and game consoles. The incorporation of IP-based connectivity into more CE and PC devices is being driven by both telecom/network operators and consumer electronics manufacturers. IPTV and multi-room DVR demand is driving cable, satellite and telecom operators to consider a variety of new high-speed home networking technologies.

  Key highlights: The ABC is the online media leader under the right policies they could follow the example of the BBC, a truly converged public broadcaster which leads the world. The dumbing down of the public media, offers great potential to the new online media companies. Online media will be driven by the ‘thinking society’. The diminishing role ninemsn in the online media landscape Focus moving away from the telcos and ISPs as media players. Massive changes in the mobile media market business models. Large uptake of mobile media expected in the under 25 years old. The marketing battle between ninemsn and Fairfax Digital. The difficulties Seven is facing with its  TiVo strategy. Triple play models are not delivering the revenues they predicted. 10% to 14% of houses currently have some sort of networking.

1. The Media Industry
1.1 Global overview
1.1.1 Introduction
1.1.2 Continental shift in competition
1.1.3 Distinct industry realignments
1.1.4 TV broadcasters
1.1.5 Radio broadcasters
1.1.6 Newspaper publishers
1.1.7 The video and DVD rental companies
1.1.8 The anomaly of the mass media
1.2 The Australian media industry
1.2.1 Media statement new government
1.2.2 TV broadcasters
1.2.3 Radio broadcasters
1.2.4 Newspaper publishers
1.2.5 The Thinking Society - market analysis
1.2.6 The video and DVD rental companies
1.2.7 Film and video producers
1.3 Media companies
1.3.1 Market analysis
1.3.2 The rise of public sector digital media
1.3.3 News Corp and subsidiaries
1.3.4 PBL - Nine - ninemsn
1.3.5 ABC
1.3.6 AOL
1.3.7 Ten Network
1.3.8 Fairfax Digital
1.3.9 Austereo online
1.3.10 Foxtel
1.3.11 Macquarie Southern Cross Media
1.3.12 WIN SelecTV
2. Marketing Strategies & Analyses
2.1 Introduction: the changing role of marketing due to digital media
2.2 Internet companies taking over the bat
2.2.1 Telcos operators of Internet economy infrastructure
2.2.2 Internet strategies around core business
2.2.3 Niche marketing for smaller telcos
2.2.4 Internet business models
2.2.5 New virtual business models
2.2.6 Wholesale to the Internet companies
2.2.7 Spinning off into the Internet economy
2.3 Simultaneous media users
2.4 The key drivers of growth
2.5 The role of service providers
2.5.1 Service providers as e-commerce leaders
2.5.2 E-cash service providers
2.5.3 The role of ISPs
2.5.4 New telcos - no winner, many losers
2.6 The future is digital people, not digital media
2.7 Customer loyalty
2.7.1 Case study - Emagine
2.7.2 Loyalty until the next deal
2.7.3 Customer segmentation
2.7.4 Effectiveness of campaigns and loyalty programs
2.7.5 Customer value management
2.8 Permission-based marketing
2.9 Advertising
2.9.1 Digital advertising - a brief analysis
2.9.2 Mobile marketing
2.9.3 New advertising models are long overdue
3. Mobile Media
3.1 The mobile content market in 2009
3.2 The market for mobile digital media
3.3 Operators have lost the content battle - analysis
3.3.1 Not much progress in almost a decade
3.3.2 Still no open networks
3.3.3 Untapped potential
3.3.4 We are a telecoms industry
3.3.5 3G is taking off
3.3.6 What do you mean - customer service?
3.3.7 All we need is competition
3.4 New marketing and distribution models
3.4.1 On-Deck Services - operator portals
3.4.2 Plenty of content providers
3.4.3 Branding with partners
3.4.4 The future: value-chain-based scenarios
3.5 Mobile TV
3.6 Premium Rate SMS (PSMS)
4. Triple Play Models
4.1 What went wrong with triple play?
4.1.1 VoIP and video - hard nuts to crack
4.1.2 TV camera in front of radio programs
4.1.3 FASTWEB is leading the charge, for change
4.1.4 Triple play soon to be forgotten
4.2 Triple play and beyond
4.3 Three distinct markets
4.3.1 Infrastructure market
4.3.2 Content market
4.3.3 Appliances and services market
4.4 Triple play basis for new pricing models
4.4.1 Lower costs open up access to new models
4.4.2 Triple play pricing
4.5 Killer apps
4.5.1 Killer app one: always-on, affordable high-speed Internet access
4.5.2 Killer app two: broadband video
4.5.3 Killer app three: broadband VoIP
4.6 Telco’s arrogant stand on content
4.6.1 Changing market
4.6.2 Triple play makes it impossible for telcos to dominate content
4.6.3 Video services will be delivered by the Internet media companies, not the telcos
4.6.4 Tele-presence will be the killer app
4.6.5 Triple play is an access product
4.6.6 Content providers are fighting back
4.6.7 Customer service is not what the industry wants to deliver
4.6.8 Internet companies might take over the telcos
4.7 Triple play in cable TV
4.7.1 Digital upgrades
4.7.2 Global dynamics cable vs telco
4.7.3 Role of cable
4.7.4 The future of infrastructure-based competition
4.8 Triple play pioneers in Australia
4.8.1 TransACT
4.8.2 Optus
4.8.3 Adam Internet
4.8.4 Soul
4.8.5 engin
4.8.6 Skype and other web apps for a flat fee from Hutchison
4.9 Triple play in telecoms
4.9.1 Broadband providers are taking the lead
4.10 Triple play will deliver transparent bills
4.11 The ACCC on triple play monopolies
4.12 The future of triple play
4.12.1 New technologies
4.12.2 FttH - ultimate triple play infrastructure
4.12.3 Media centres in the home
4.12.4 Separation and integration
4.13 International benchmarking
5. Home Media Centres & Home Networks
5.1 Industry overview
5.1.1 Market in progress
5.1.2 Home media developments
5.1.3 Home networking developments
5.1.4 Market analysis
5.1.5 Key developments
5.1.6 Industry sectors vying for home media market
5.1.7 DVR overview
5.1.8 Industry consortia
5.2 Australian developments
5.2.1 Statistics and forecasts
5.2.2 Home networking developments
7. Glossary of Abbreviations
Table 1 - Online users and other media usage
Table 2 - Media advertising expenditure - 2002 - 2005
Table 3 - Australia - triple play pricing - 2005
Table 4 - Percentage of operators globally offering unlimited nationwide fixed-line calls - 2005
Table 5 - Triple play pricing with per-minute call charges - 2005
Table 6 - Double-play pricing (voice and data) with per-minute call charges - 2005
Table 7 - Bit caps and corresponding service limits from off-network sources - 2005
Table 8 - Networked TV shipments worldwide - 2008; 2012
Table 9 - Forecast installed base of homes with connected entertainment networks worldwide - 2010 - 2011
Table 10 - Broadcasting subscribers, annual change and penetration in the US - 2008
Table 11 - BSkyB subscriber statistics - 2005 - 2007
Table 12 - BSkyB ARPU - 2005 - 2007
Table 13 - BSkyB revenue, operating profit and annual change - 2007
Table 14 - Market shares of major MSO, DBS & telco video providers in the US - 2005; 2007 - 2008
Table 15 - Consumer electronics sales growth in the US - 2006 - 2008
Table 16 - Internet-enabled consumer device shipments worldwide - 2012
Table 17 - DVR households worldwide - 2007; 2011
Table 18 - DVR shipments worldwide - 2007; 2011
Table 19 - Home network penetration of households - 2005; 2007-2008; 2010; 2015
Table 20 - Australian multi dwelling units (100+) - 2003 - 2009
Table 21 - Key features sought by smart wiring customer - 2004 - 2007
Table 22 - Existing level of smart wiring uptake - 2004 - 2007
Table 23 - Revenue forecasts - Australian home automation market - 2003 - 2008
Exhibit 1 - Murdoch-Packer deal structure and pblMedia structure
Exhibit 2 - pblMedia structure
Exhibit 3 - Telecommunication convergence
Exhibit 4 - Why mobile marketing won’t work
Exhibit 5 - Mobile facts and figures
Exhibit 6 - What users want
Exhibit 7 - Description of National Cable and Television Association’s Broadband Home
Exhibit 8 - Media centre devices
Exhibit 9 - TV-orientated consumer devices adopting IP interface
Exhibit 10 - Networked client devices
Exhibit 11 - EPGs versus IPGs
Exhibit 12 - Top 5 DVR providers worldwide - 2008
Exhibit 13 - Multi-dwelling units

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