Olivier Braet: Business model issues voor de audiovisuele sector

Business model issues for the audiovisual sector [email_address] IBBT-SMIT, Pleinlaan 9, 1050 Brussel

A) OBSERVATIONS
B) EXPLANATIONS
(c) 2009 - Olivier Braet, IBBT-SMIT, Pleinlaan 9, 1050 Brussel

SOME BASIC OBSERVATIONS

Illegal downloads
P2P: Bittorrent has replaced Napster, Limewire, Kazaa, etc …
Over http: downloadfora, blogs, google

Content industrie
SMPTE Broadcast flag: For digital TV
CSS (Content Scramble System): DVD-CCA
AACS(LA) (Advanced Access Content System(Licensing Administrator)): For HD-DVD / Blue-Ray
IP Targeting (Case: hotspotshield)
Connectiviteitsindustrie
Deep Packet Inspection
Traffic shaping (packet prioritization)
OMA DRM: Mobile world
OSF: Broadcasting world (DVB consortium)
18 Crypt: Broadcasting world (DVB consortium)
Software industrie
Windows Media DRM (BBC iPlayer); Apple Fairplay; Helix DRM; Adobe Flash DRM
Protected Video Path (PVP)
Contentguard (XrML)
DReaM
Consumenten electronica
HDCP for HDMI
DTCP
Proprietary PVR techniques
Proliferation of Digital Rights Management (c) 2009 - Olivier Braet, IBBT-SMIT, Pleinlaan 9, 1050 Brussel

Free streaming dominates

Legal and economical arguments thicken
“ Intellectual and artistic property rights are every bit as important as the rights of ownership to physical property. It is no less wrong to steal a film recording than it is to steal a teenager’s laptop.”
But stealing a laptop is zero-sum; stealing a digital song or movie is not.
Argument from efficiency : “Without enforceable artistic property rights, there is no incentive to produce.”
Empirically unproven
Argument from justice : “Taking something for nothing, without permission, and with no compensation for the person who created and owns it, is wrong.”
But creating does not imply ownership, nor is there a right to maximize income.

B) EXPLANATIONS

Explosion in supply & demand (c) 2009 - Olivier Braet, IBBT-SMIT, Pleinlaan 9, 1050 Brussel DEMAND Quantity Price SUPPLY Democratization of digital production expands media supply… … equilibrium price of media drops to below zero € 0 Source: Umair Haque

Strategic reasons for DRM
Each industrial actor attempts to control the value stream of its ecosystem
Content aggregators want to maintain traditional revenue model
ISPs are worried about broadband consumption
Software providers strive for platform dominance
Consumer Electronics manufacturers aim for hardware profit margin
The higher in the value chain, the greater the fear for canibalisation. Biggest fear: Exchanging analog Euros for online cents.

Creators and aggregators most afraid for digitalization
Bron: Telco2.net 2007 managersenquête

CONCLUSION:
DRM Business Motives
& Revenue models

1 st pro memorie: Revenue mechanisms for online digitale content
Three basic mechanisms:
Direct revenue model
“ Pay-per-item” (iTunes 68%, AmazonMP3 5%)
Subscriptions (license model: Rhapsody 2,5%)
Advertising based revenue model
Free-to-air
Product placement; merchandising
Rights clearance
http://fairplaycalculator.nl/
Public broadcaster subsidies
… and combinations of the above.

2 nd pro memorie: Media consumer generations according to IBM
‘ Massive Passives’
Older demographic
Prime Time TV; “lean back”
‘ Gadgetiers’
Younger professionals
Focus on ease of use (iTunes, PVR)
‘ Kool Kids’
Children, teenagers, students
Multitaskers; Circumvent protections (download, rip and share)

2 nd pro memorie: Better approach :: Technology and age agnostic variables
Product category
Do not treat ‘music’ or ‘books’ etc. as single content forms
Sort according to repeat use value
User groups
Do not treat age cohorts as groups with same technological competences
Sort according to technology knowledgeability & sensitivity

Introducing supply & demand
Collectability & Sensitivity

Requests anyone?
Olivier Braet IBBT-SMIT (V.U.B.) Pleinlaan 9, 1050 Brussel olivier.braet@vub.ac.be

Olivier Braet: Business model issues voor de audiovisuele sector

by Muziekcentrum Vlaanderen on Oct 29, 2009

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Olivier Braet: Business model issues voor de audiovisuele sector — Presentation Transcript