Riding the Digital Wave <ul><li>Curt Marvis </li></ul><ul><li>President Digital Media, Lionsgate </li></ul><ul><li>October...
 
Digital Media: Introduction In the wake of a digital-driven “media meltdown,” media and entertainment companies are slowly...
Digital Media: Growth and Market Opportunity MONETIZATION Providers of web, EST, and OTT content are successfully monetizi...
*Total screens available to US consumers (M) 46M 60M 79M 90M 169M 281M 330M 811M 1.9B Massive Growth in OTT Distribution t...
TV is WHAT You ’ re Watching Not HOW you ’ re watching
Growth around Apps and Social Games New content model for consumers ($38B by 2015)
<ul><li>THE NEW TRINITY </li></ul><ul><li>VIDEO  </li></ul><ul><li>+ MOBILE   </li></ul><ul><li>+ SOCIAL </li></ul>
U.S. Smartphone Users Now Spend More Time with Mobile Apps than they do Using the Desktop and Mobile Web
“ Every 12 to 18 months, the Amount of Information Being Shared by People on the Web will Double.” ZUCKERBERG’S  LAW
 
Facebook PLATFORM POWER   CITYVILLE REACHED 100,000,000 NEW USERS IN JUST 30 DAYS
The New Online Currencies As of July 1, 2011 – USING FACEBOOK CREDITS WILL BE “MANDATORY” FOR  INJECTING REAL MONEY INTO G...
WHO SHOULD YOU TRUST?
Brand to Consumer is the Wave of the Future <ul><li>Lionsgate content currently touches an audience of 70+ million people ...
How does Lionsgate leverage this opportunity? <ul><li>Create  new content in the form of social games, apps and web series...
Brand to Consumer Offerings Digital Media Content and Distribution Original & derivative Web series, Branded Channels, Mic...
What is currently happening at Lionsgate? <ul><li>Two social games launched this fall.  WEEDS SOCIAL CLUB and the DIRTY DA...
STREAMING MOVIES ON FACEBOOK THE WISDOM OF “ FRIENDS ” HAS TURNED OUT TO BE FAR MORE VALUABLE THAN THE WISDOM OF CROWDS
<ul><li>LOW BARRIERS TO ENTRY </li></ul><ul><li>HIGH BARRIERS TO SUCCESS </li></ul>
LOW BARRIERS TO ENTRY <ul><li>Three Major Paradigm Shifts Across the Entire Consumer  +  Business Technology Sectors of th...
COMPETITIVE BUSINESSES OF TOMORROW <ul><li>We think we understand the traditional terms and concepts,  </li></ul><ul><li>b...
Games Rewards Commerce International Entertainment On-Demand Theatrical LIVE Music Sports Advertising Brands Social/Mobile...
Long-term INNOVATION: The Five-Year Plan The Next Five Years: Transition from Adaptation to Innovation The short-term tact...
Thank You! Open Q and A
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Keynote: Riding the Digital Wave

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Curtis Marvis, President of Digital Media, Lionsgate, reveals how film studios are getting into the business of tackling the digital space. Learn about the creation of the Weeds Social Club and the Dirty Dancing Social Game, which became the #2 fastest growing facebook game in the world within two weeks of its launch. Lionsgate produces critically acclaimed television titles Mad Men, Weeds, and Nurse Jackie, and has released numerous box office hits including THE EXPENDABLES, THE LAST EXORCISM, SAW 3D, and PRECIOUS. Lionsgate continues to lead the way as an independent producer and distributor of motion pictures and television programming as it explores new opportunities in multi-platform and digitally delivered content.

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Keynote: Riding the Digital Wave

  1. 1. Riding the Digital Wave <ul><li>Curt Marvis </li></ul><ul><li>President Digital Media, Lionsgate </li></ul><ul><li>October 27, 2011 </li></ul>
  2. 3. Digital Media: Introduction In the wake of a digital-driven “media meltdown,” media and entertainment companies are slowly taking advantage of continuing innovation in the digital landscape <ul><li>In recent years, all segments of Media and Entertainment have experienced accelerating change across several dimensions, rooted in the pervasive impact of “digital disruption” </li></ul><ul><li>Companies press ahead with digital transformation initiatives, with strong signs that a “new normal” is emerging, characterized by: </li></ul><ul><ul><li>Personalization of digital services delivered to individual consumers </li></ul></ul><ul><ul><li>Rapidly shifting technological platforms that diminish the authority of mass media and empower the &quot;audience of one“ </li></ul></ul><ul><li>Today, media companies no longer frame the digital landscape as a challenge to overcome, but as an opportunity to deliver commercial value </li></ul>Accenture Survey, 2011: More than 48% of surveyed media and entertainment executives assess the digital landscape as an opportunity (as opposed to a challenge) Source: Accenture: Reshaping The Business for Sustainable Digital Growth, 2011
  3. 4. Digital Media: Growth and Market Opportunity MONETIZATION Providers of web, EST, and OTT content are successfully monetizing this growing online viewer base The OTT market will grow into a $16B+ industry by 2016 Total OTT market size ($B) Source: IMS Research, “Over the Top Video – Service Delivery and Business Models” 43% CAGR Online advertising spending is expected to grow significantly, thereby supporting free-to-view (e.g. YouTube) models Total Online Advertising spend worldwide ($B) Note: includes banner ads, search, rich media, video, classifieds, sponsorships, lead generation, and email; excludes mobile ad spending Source: eMarketer, June 2010 10% CAGR Electronic Sell-Through spend is likewise expected to grow, driven by adoption of Ultraviolet and digital locker platforms Total Electronic Sell-through (EST) spend ($M) Ultraviolet is the digital locker initiative supported by Lionsgate, Paramount, Fox, Warner, Sony, and Universal, as well as Netflix, Comcast, Best Buy, Roxio, and many CE companies “ Buy once, play anywhere”: UV allows user to upload digital copies of content from disc or EST into a locker to view from nearly any device Source: Adams 21% CAGR
  4. 5. *Total screens available to US consumers (M) 46M 60M 79M 90M 169M 281M 330M 811M 1.9B Massive Growth in OTT Distribution to connected devices, including tablets and smartphones More Screens = More Content The typical home of 2.6 people has an average of 24 gadgets, including at least one smartphone. There are now more wireless devices in the US then there are people: 327.6M
  5. 6. TV is WHAT You ’ re Watching Not HOW you ’ re watching
  6. 7. Growth around Apps and Social Games New content model for consumers ($38B by 2015)
  7. 8. <ul><li>THE NEW TRINITY </li></ul><ul><li>VIDEO </li></ul><ul><li>+ MOBILE </li></ul><ul><li>+ SOCIAL </li></ul>
  8. 9. U.S. Smartphone Users Now Spend More Time with Mobile Apps than they do Using the Desktop and Mobile Web
  9. 10. “ Every 12 to 18 months, the Amount of Information Being Shared by People on the Web will Double.” ZUCKERBERG’S LAW
  10. 12. Facebook PLATFORM POWER CITYVILLE REACHED 100,000,000 NEW USERS IN JUST 30 DAYS
  11. 13. The New Online Currencies As of July 1, 2011 – USING FACEBOOK CREDITS WILL BE “MANDATORY” FOR INJECTING REAL MONEY INTO GAMES
  12. 14. WHO SHOULD YOU TRUST?
  13. 15. Brand to Consumer is the Wave of the Future <ul><li>Lionsgate content currently touches an audience of 70+ million people on YouTube and Facebook every month and it is constantly growing </li></ul><ul><li>Monetization of certain Brand to Consumer products is growing at a staggering pace with sales of apps and social games. Neither of these product lines was in existence 3 years ago </li></ul><ul><li>Zynga currently has over 300M users on FB out of an audience of 700M FB users. By next year over 70M Americans will play social games. 20% of FB game players have paid cash for in-game benefits </li></ul><ul><li>YouTube shows over 3B videos a day and has over 48 hours of video uploaded every minute. This includes over 9B a month via mobile </li></ul>
  14. 16. How does Lionsgate leverage this opportunity? <ul><li>Create new content in the form of social games, apps and web series that leverage both existing IP as well as newly created IP </li></ul><ul><li>Focus efforts on existing high audience sized FB properties as well as content that is well suited for both pad and mobile audiences </li></ul><ul><li>Leverage existing brands that have high value for translation into new forms of revenue generating content for “bite sized” entertainment </li></ul><ul><li>Use third party developers who can bring experience, distribution strength and superior technology to the table </li></ul>
  15. 17. Brand to Consumer Offerings Digital Media Content and Distribution Original & derivative Web series, Branded Channels, Micro-nets and specials Facebook Social Games and Apps/Games Transactional EST and VOD via B to C
  16. 18. What is currently happening at Lionsgate? <ul><li>Two social games launched this fall. WEEDS SOCIAL CLUB and the DIRTY DANCING SOCIAL GAME. </li></ul><ul><li>Trailer Trash (original animated series) is live on both YouTube and HULU. A Trailer Trash game is now available on numerous game sites on a “free-to-play basis” with virtual goods up sell </li></ul><ul><li>Increased YouTube presence for original content. </li></ul><ul><li>Partnerships with leaders in web series and original content. </li></ul>
  17. 19. STREAMING MOVIES ON FACEBOOK THE WISDOM OF “ FRIENDS ” HAS TURNED OUT TO BE FAR MORE VALUABLE THAN THE WISDOM OF CROWDS
  18. 20. <ul><li>LOW BARRIERS TO ENTRY </li></ul><ul><li>HIGH BARRIERS TO SUCCESS </li></ul>
  19. 21. LOW BARRIERS TO ENTRY <ul><li>Three Major Paradigm Shifts Across the Entire Consumer + Business Technology Sectors of the Economy: </li></ul>INFRASTRUCTURE INVESTMENTS IRRELEVANT IMMEDIATE AND UNRESTRICTED ACCESS TO TECHNOLOGY NEW USAGE, PRICING AND PAYMENT METHODOLOGIES
  20. 22. COMPETITIVE BUSINESSES OF TOMORROW <ul><li>We think we understand the traditional terms and concepts, </li></ul><ul><li>but they mean different things today… </li></ul>Distinctive Technologies Network Effects Scalability 24/7 Infrastructure – Big Horsepower Costs Personnel – Lots (Maybe Cheap) Marketing – Wannamaker or Worse Rent—Cloud—or—Free Ride Customers/Users/Contributors = Labor Self-Organized, Identified, Permissive Browser-Based Friction-Free Portable YESTERDAY TOMORROW
  21. 23. Games Rewards Commerce International Entertainment On-Demand Theatrical LIVE Music Sports Advertising Brands Social/Mobile Online/Casual Hard-core TV LIVE Cloud-Based Mobile & Wireless Online, TV Electronic Coupons Check-in Social Networking Text Alerts Geo-Location Promotions Affinity Cards Discounts Mileage Plus (DISTRIBUTION) Over-the-Top National Retailers PC & iPad Services BD Live Disc Social Networks Cable & Telco Operators Gaming Consoles Consumer Electronic Manufacturers DBS Web Online Product Placement Direct Response Data Analytics The Integrated Digital Franchise 7 Principles Mobile Social Influence Sharing Reward Curation Entertainment BRAND X
  22. 24. Long-term INNOVATION: The Five-Year Plan The Next Five Years: Transition from Adaptation to Innovation The short-term tactical plan is Lionsgate’s adaptation to the digital media landscape… ..but does a long-term opportunity exist for Lionsgate to be a true innovator in this space? Short-term ADAPTATION: The One-Year Plan Innovation engine (Digital incubator / Lionsgate Labs / or venture fund) + New digital operating model and strategy + +Partnerships with Silicon Valley companies + Appropriate resource investments Individual initiatives driven out of Digital Media group based on market needs and opportunities Launch of LG-branded micronetworks New social games roll-out New partnerships and games with mobile app developers Facebook monetization Lionsgate-branded social experience platforms Gamification of existing content (e.g. interactive Mad Men on iPad) Fully interactive storytelling (e.g. using Microsoft Kinect) Innovative advertising delivery models Sample initiatives Sample initiatives
  23. 25. Thank You! Open Q and A

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