FICCI, along with PricewaterhouseCoopers (PwC), has brought the digital medium under the scanner in its recently released report ‘Entertainment and Media: India going Digital’. The report focuses on a digital rights management system (DRMS).
According to the study, an efficient DRMS that allows management and protection of digital content; and technology-agnostic, forward-looking and robust regulatory policies balanced with self-regulation and cross-industry agreements, were the need of the hour to give a fillip to the fast-growing Indian digital entertainment and media industry.
The study points out that the advent of digital media had thrown up several new issues that Indian stakeholders needed to take cognizance of. Among these, copyright issues were at the foremost which impacted exploitation of digital content across ‘new media’. Technology issues, especially those relating to inter-operability of equipments and devices at consumer premises, are also to be dealt with. Digital piracy, though at a nascent stage, will also be a challenge for Indian stakeholders, with proliferation of digital media to Indian masses. The FICCI-PwC study thus notes that an efficient DRMS that will allow management and protection of digital content in a digital environment should be made mandatory.
India is currently witnessing a trend of increased digital infrastructure penetration of broadband and mobile networks, which now makes it possible to broadcast, stream and download digitised content from diverse platforms to a variety of devices. The new technological environment is thus creating great opportunities for content providers in India to monetise their valuable content across various digital media and devices.
However, the migration to digital formats is having an adverse impact on competing revenue streams. The FICCI-PwC study points out that digital/mobile spending streams competed with physical home video sell-through and rental, physical recorded music sales, physical book sales and purchases of magazines and newspapers. Additionally, traditional TV, radio, magazine, and newspaper advertising continued to compete with Internet advertising.
The study also found that companies were forming alliances and joint ventures to better take advantage of and serve the needs of the changing environment. Broadcasters are creating strategic alliances with digital networking companies and teaming up with Internet companies and wireless providers to stream programming, both over the Internet and mobile devices. Publishers and search engine companies are working together to share content and sell advertising in both print and digital formats. Technology companies are creating alliances to support the expansion of digital and mobile distribution of content.
The study notes that content, distribution, and technology companies are thus expected to continue to pursue new relationships during the next five years to accommodate the growing role that digital distribution will play in the entertainment and media market.
In 2006, the various digital platforms generated $690 billion in global spending, or 48 per cent of total entertainment and media spending, including Internet access spending. During the past ﬁve years, spending on these platforms expanded by double-digit rates and high-single-digit rates. Two additional years of double-digit growth are expected, with high single-digit gains anticipated during 2009–11. By 2011, spending on these platforms will reach $1.1 trillion, growing at a 9.1 per cent compound annual rate. Asia Paciﬁc will be the fastest-growing region, with a projected 13.5 per cent compound annual increase.
The FICCI-PwC study highlighted that customer focus could very well be the key differentiator in the times to come. Such a focus means knowing one’s customers, offering them the best experience, making sure one’s organisation truly listens to customers while having the agility to react quickly to their changing expectations. Those companies able to harness this approach almost certainly will be the winners in a competitive and increasingly complex marketplace.
More and more entertainment and media companies are pushing forward with their triple- and quadruple-play strategies. Enabled by the growth in broadband and mobile, new players are intensifying competition and the fight for revenues, as the market moves toward lower prices.