Content Supply Chain Management White Paper

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There is a well worn phrase that “content is king” and this remains as true as it ever was except that realizing content’s value is now a whole lot more complicated.

Content can be entertainment - a movie like Avatar, a sports highlight from the World Cup, an episode of the Simpsons. It can be a commercial, a business briefing, a financial report, a satellite map, a medical image or amateur video. A value may be attached to that content by the owner, publisher and ultimately the audience/consumer and may be enhanced by additional content or the context in which it is presented. In essence content is information and in a world of information technology, content needs to be manipulated as information. There is more content than ever and many new ways to consume that content – thus the complexity of managing the flow of that content throughout the supply chain - from creation to the consumer.

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Content Supply Chain Management White Paper

  1. 1. Content SupplyChain ManagementServicing the new supply chain economics
  2. 2. There is a well worn phrase that “content is king” and this remainsas true as it ever was except that realizing content’s value is now awhole lot more complicated.Content can be entertainment—a movie like Avatar, a sports highlight from the World Cup, an episode of The Simpsons. It canbe a commercial, a business briefing, a financial report, a satellite map, a medical image or amateur video. A value may be attachedto that content by the owner, publisher and ultimately the audience/consumer and may be enhanced by additional content or thecontext in which it is presented. In essence content is information and in a world of information technology, content needs to bemanipulated as information. There is more content than ever and many new ways to consume that content—thus the complexityof managing the flow of that content throughout the supply chain—from creation to the consumer.All content should be considered an asset, but in today’s digital media environment its true value will only be realized if you haveextremely precise, up-to-the-second knowledge of what assets you have, where it all is, who is needs it, when it will be delivered,what form is required and finally that it has arrived. All of this information about your content needs to be visible at any timefrom a single view. How else will you know exactly how much money these assets are making and whether or not you can you pushthat number even higher? Broader availability and better utilization of all the information about your content translates assetsdirectly into profits.CFOs are pushing hard to ensure that investments achieve maximum ROI, and that resource utilization is aligned more closelywith business capacity. That same utilization is also being examined on a global level across numerous company divisions, toensure that assets in one community can be advancing a project in parallel with another, allowing for projects to be deliveredfaster and more profitably. The days of project slippage, long response times and robust margins are rapidly falling prey to agileoperators who can compete faster than ever before.Once upon a time the delivery of a programme by terrestrial broadcast, satellite or cable was a relatively straightforward point topoint procedure. The content traveled along a very linear path from creation to consumption. The time windows were also verylinear: a movie was released in the theatre, six months later it was on tape in the video store, and some period later it was re-cutfor TV broadcast. Television programming was broadcast at 8pm on Thursday, god forbid if you missed it, put on the shelf tillsummer reruns and then finally when you hit the magic number of one hundred episodes, sold into syndication.Innovation in video editing technology, digital media, networking and consumption technology like the iPod, DVRs,connected TVs, VoD, on-line streaming and file sharing have forever changed the business models and made the supply chainextremely complicated. Networking technology and the Internet is the foundation of all of these changes. As global IP traffic surges upwards, the biggestsingle component is video as faster broadband speeds are allowing users to access videos even more swiftly, leading more peopleto search online for their video needs. The popularity of websites like YouTube and catch-up TV sites like Hulu and iPlayer havefuelled popularity. The launch of new platforms such as tablet PCs and connected TVs (Google TV and Canvas) will have a hugeaffect on net traffic which is set to increase from 2.7 Exabytes per month to 19.5 Exabytes a month by 2014 (Visual NetworkingIndex Global Forecast).Since the prevailing content supply chain for premium TV programme and feature films is strictly linear it is simply not built tocope with these changes. It evolves from the creative acquisition and editing of content to the management of that piece as a finalmaster copy before distribution and eventual playout, after which it will be typically shelved in the archive until needed for re-runs. Content is contained in physical form, usually tape, which is inherently nonlinear and inflexible in structure and requirescostly manual processes, and lengthy delays between each isolated silo in the chain. 2
  3. 3. “Old School” Linear DistributionToday content producers are trying to cut costs while capitalising on new distribution outlets and windows. They are looking tothings like reality television, outsourced creative services, global collaboration and user generated content to cut costs. They arelooking to international distribution which can lead to an increased audience size—up to twenty times over just the domesticmarket alone. When going international, the time window is much tighter than it was even two years ago. Same day and daterelease of major movies like Avatar is critical to capturing the maximum revenue and increasing ROI before pirating of the contentbecomes a factor. Digital outlets like iTunes, VoD, Amazon and Hulu offer the promise of getting their content to a much wideraudience and the business models are evolving and getting closer to revenue neutral with linear broadcast.“New” Digital Content DistributionContent may be king but making sure its value is maximized has become vastly more complicated. Managing this complexity isthe challenge you face with delivering the experience that the consumer wants.Macro trends impacting the supply chainA number of macro trends have begun impacting the market in ways that fundamentally change the way the supply chain ismanaged. These include file-based workflows, format migration and changes in distribution window. 3
  4. 4. Trends and ImpactFile-Based Workflows: In theory the movement from tape to file-based workflows is well-rehearsed yet most organizations areonly 10-15% through the migration. The overwhelming majority of businesses contain partially or wholly outmoded analogueprocesses which are undercutting the profitability of their entire enterprise. Tape operation is slow, expensive, hard to manage,energy draining and materially harmful to the environment not to mention injurious to a company’s bottom line. By replacingphysical media with file-based methods, companies can immediately realize ten times savings on every transaction. Everyoneagrees that the days of tapes and physical media disrupting the free flow of content through the supply chain are over. In fact,many organizations have set deadlines to fully convert to file-based workflows.By contrast, once physical media is converted to files it moves into the domain of Information Technology, content can bemanaged along the lines established for the management of all other IT data. Once you work with files you suddenly have theability to automate the creation, management, distribution and archiving of content. Content becomes a flexible asset with valuewaiting to be unlocked.Format Migration: Beyond analogue to file-based migration there is a parallel expectation to move from standard to HighDefinition (HD) and now into premium forms of HD such as 1080p 50/60 and even 3D. It is estimated that the market is about5-10% into this conversation process. There’s a virtuous circle driving this momentum: having tasted the benefits of enhancedpicture resolutions and experienced stereoscopic 3D, consumers are demanding choice and a better home viewing environment;consumer electronics manufacturers have a strong interest in marketing more and new versions of HD-ready and 3D-capabledisplays and STBs; while the broadcast industry, and pay-TV operators in particular, spy in these new formats a means ofmaintaining and up-selling subscribers to premium pricing or attracting new ones. This transition puts a greater strain on thesupply chain, these formats result in files that are two to ten times the size of SD and moving large files globally is not an easy taskusing today’s networks.Distribution Windows: In short the drive to new formats is a win-win for all concerned—provided it can be facilitated in anefficient manner. That means moving rapidly to market and distributing the latest versions of content to new territories within aselect and finite period. Repackaging typically includes inserting ads and promos, transcoding into the right format, conforming,QC, adding digital rights management (DRM) and virus scanning before final delivery. In addition to linear and VoD there isalso HD/SD, online and mobile. New windows have opened for digital electronic sell-through on iTunes, Hulu or Netflix oftensequenced internationally same day/date. Distribution windows have to be targeted and hit while they open or the revenuemaking opportunity is lost forever. Studies show that the value of content diminishes over time and that value is its highest 4
  5. 5. in the initial 24–72 hours after premier. Any delays in getting the asset available to the audience will result in lost revenue andlower profitability.The combination of these three trends: a move to files, a migration to enhanced formats and the quickening pace to marketdemanded of new distribution windows has significant effects on the assets a company is trying to manage.Chiefly, there’s a requirement to move not just one file from simple point-to-point but to transport multiple files to multipledestinations and onto the many different outlets where people consume content—rapidly. These files will vary in size and formatorigination. With increased volumes of HD and 3D, video files need shipping around and between businesses without sappingvaluable bandwidth and avoiding network bottlenecks. Simply trying to transport large files over a network creates latency. It isslow and unreliable and while different parts of the content creation, management and distribution supply chain lie disconnectedthe problem is exacerbated.Content must be aggregated from multiple source locations to a target location. The target location will typically be a cablehead-end, telco, or a Content Delivery Network (CDN). On the surface, this scenario seems fairly straightforward. But on closerexamination questions arise: Who determines when the content should move? Over which network? Using how much of thenetwork? What are the notification methods for the sender and the receiver?This entirely new and complex set of arrangements needs to be orchestrated by a comprehensive logistics-based file system:in short, Content Supply Chain Management (CSCM).How is the market currently served? CSCM Market ClimateHaving established that physical media distribution is economically and environmentally unsound, companies have, out ofnecessity, turned to unmanaged IP-based solutions. These are inefficient and unreliable from a network stand point, lack anyreliable means to track assets and involve manual processes. If you care about content security you need to be able to track yourcontent at every point inside your business and en route to partners. At the same time the ability to track content, to knowits current location, its ultimate destination, exactly who has got it, when it was received and where it’s going next is businesscommon sense. It is a streamlined business common sense—but unmanaged transport solutions won’t enable you to implement it. 5
  6. 6. Companies could turn to niche service providers that specialize in file movement to perform some of these functions. However,as proprietary solutions, they are as expensive as shipping physical media, have limited network footprint and are not optimizedfor moving larger and larger files. Inevitably, you don’t just want your content to go to the parts of the network that happen to becovered by a certain provider—you want 360-degree flexibility to be able to send that content anywhere it is requested. By usingniche service providers companies will be unable to maintain their top level enterprise security models when their system andassets interfaces with those of third parties not equipped in the same fashion. With no clear benefit to using a service providingand wanting to assert control over their digital media business, organizations have set about building their own content supplychain management or B2B CDN networks.The most dramatic example of how these different distribution solutions impact a business is in cost.Physical Media/Tape Distribution: A simple tape transport from one place to another averages $200 USD per transactionbut can stack up to $1,000 with each new duplication and/or link in physical shipment. For example, if you are sending twentytapes a day between two locations—over the course of the year that is over seven thousand tapes at a cost of between $1,000,000and $2,000,000.Niche Service Providers: Niche service providers charge $20–80 per GB. The cost of satellite-based file transfer services comein the region of $80 per GB, whereas terrestrial can range from $20–50/GB. These service providers have done a great job ofpricing their service at about what tape delivery costs and offering the convenience of time. So there are no cost advantages of thecurrent services.Internal CSCM: By rolling out a Content Supply Chain Management solution, such as Signiant’s, the price per GB is as little as$2. This can result in cost savings of 30–1,000% over other methods. Implementing a CSCM solution can enable an organizationto cost effectively move to file based workflows, gain control of their assets, scale their digital business, capture new distributionwindows opportunities and to transform their business.What is Content Supply Chain Management?Signiant Use Cases: Aggregation of Content, Processing and Value-Added Services, Distribution 6
  7. 7. There are four areas of functionality to get beyond the simple large file movement problem to really gaining control of yourcontent supply chain. While a vital component, accelerated file movement does not on its own define a Content Supply ChainManagement solution. Equally core aspects to a solution include central management; content process automation and B2Bcontent peering.Accelerated Content Transport: Once you have committed to file based workflows, it is imperative to be able to move largerand larger files over the network efficiently. These files could be 1GB, 5GB, 30GB or even 1TB and need to be moved fast,reliably, efficiently and securely over the network to reach in the world.Over the wide area, with conventional open internet delivery mechanisms like TCP, you could only get 10% bandwidthefficiency—that means at 100Mbps you are only getting an actual throughput of around 10Mbps. This makes sending these largepackages impractical, especially with large volumes. Using accelerated file transfer, you achieve north of 95% throughput or speedsup to two hundred times faster than conventional network topologies—to enable you to meet your service deadlines, all of the time.At the same time as optimizing speed, an accelerated content transport solution requires that content move across the networkseamlessly without encountering any security gaps. Deployment of an accelerated content transport protocol automaticallyincludes the rollout of an end-to-end enterprise security model. Enterprise class security means tying content into the directoryservices of the enterprise, encrypting your files transfers, ensuring each node of the network is authenticated and that file deliveriesare signed digitally to confirm delivery and data integrity. You want to ensure you don’t violate corporate policies and that there’s afailsafe routing of the right content to the right recipient, all of the time.Similarly transport resiliency is critical when dealing with large files. Any interruption in the movement of content must be ableto recover automatically and continue the transfer where it left off. If the transfer must restart from the beginning, it is incrediblyinefficient (imagine being 90% of the way through a 30GB file transfer and having to start again from the beginning) and may notallow you to meet your business deadlines.All of which solves just one of the problems faced by media organizations—that of moving large files around without issue. Thereality is that companies need to transfer large and expanding numbers of files and here’s where the other elements of a ContentSupply Chain Management solution come into play.Central Management: You need to make sure that files arrive at the right place at the right time and to be able to oversee that inan instant in the form of a single dashboard. You need status reports of your assets wherever it is on the network at any time. Youcannot afford to risk files falling through the cracks, delays or sent to the wrong place. Since files are being pushed and pulled fromand to multiple destinations you need something that unifies in a single view, the current status of all of your content. For that youabsolutely need a centrally managed suite of resources that gives you the ability to manage, track and reprioritize bandwidth toensure files are delivered with first class efficiency.Content Process Automation: Efficiency also means eliminating manual processes where possible since wherever it lies in thesupply chain, human intervention is prone to introduce delay and errors and means that content doesn’t flow naturally throughthe system. Interruptions in the digital supply chain—either through un-needed manual intervention or offload to physical mediadoes not allow you to scale your business and cut costs.Content Process Automation is predicated on moving from physical media to the world of file-based workflows. For example therepackaging of media into different versions, adding appropriate promos, stings and bumpers, adapting for language, QC and soon is a repetitive and mundane exercise which is best outsourced to your CSCM solution whose reliability and efficiency can beguaranteed. In fact, in many instances the final step in the ‘manufacturing’ process of a piece of content is to create a short term 7
  8. 8. archive for the asset. This archive has two important purposes—it is a digitally signed version to ensure data integrity between theasset delivered and the one being served the viewers. Inevitably, someone will mistakenly delete the file—and since there is hardcost and time associated with creating this asset, having a backup ready for delivery is important.Using automation with pre-defined templates for each version eliminates labor costs as well as human error. Processes kick offautomatically either through the use of triggers or API calls from other business systems.B2B Content Peering: To truly interconnect a supply chain you need to cross the boundaries of organizations and corporations.Global collaboration and partnerships are more important than ever, with that the seamless exchange of content is of paramountimportance. Enabling content to flow across these boundaries seamlessly without interruptions while maintaining your enterprisesecurity policies is crucial.Connecting these organizations across wide geographical areas is a big challenge. There are network, security and process issuesto address. Businesses need to notify each other of incoming files, have visibility into what is delivered and have control overall incoming and outgoing files including priority and bandwidth control. That means having the ability to link your CSCMsolution to other businesses and exchange content freely with a common model.Conclusion: Servicing the new supply chain economicsWhile content will always be king, the way it is created, managed and consumed has changed forever. Companies are trying totransform their content businesses in reaction to breakthrough technologies, consumer choice, globalisation, and shrinking timewindows. With that, there are three major trends shaping the content future and company’s ability to capitalize on these newopportunities—including moving from physical media distribution to file-based workflows, the format transition from standarddefinition to high definition and ultimately 3D and finally new distribution outlets and windows.In order to capitalize on these trends, the market is currently not being served by shipping media, unmanaged solutions like FTPor the niche services that have tried to fill the growing need. In order to address the opportunities, you need a Content SupplyChain Management strategy that addresses all of the major challenges and provides the level of functionality of a completesolution, not just moving large files from point A to point B. It must move them quickly, securely and reliably; you must havecentral control and visibility into your entire supply chain, you must have the proper level of automation, and you must eliminateas many manual processes as possible. Finally, your strategy must include how you exchange content with other organizations andbusiness partners.One thing is certain, the supply chain for content has changed forever and organizations must adapt to that change. Contentis no longer created and consumed along a linear process. The global exchange and transformation of content among manyorganizations is essential to the new models. So as the supply chain changes, so must the company and having a ContentSupply Chain Management strategy is essential to adapt to that change—making the right decisions that will make you theContent King.This paper was authored by Tony Lapolito, VP of Marketing & Product Management, Signiant.You can learn more about Signiant at signiant.com. 8

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