Arab Media Outlook 2008-2012


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Dubai Press Club / PricewaterhouseCoopers: Arab Media Outlook 2008-2012

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Arab Media Outlook 2008-2012

  1. 1. AARAB MMEDIA OOUTLOOK 022008-2012 aroballoCCollaborating for growth na stsaceroFForecasts and analysis of traditional em latigid & digital media in the Arab world & Created by: Supported by: 2nd Edition
  2. 2. BA AID KOOLT 2102-8 htworg rof gni lanoitidart fo sisylana dlrow barA eht ni ai
  3. 3. AARAB MMEDIA OOUTLOOK 022008-2012 aroballoCCollaborating for growth na stsaceroFForecasts and analysis of traditional em latigid & digital media in the Arab world & Created by: Supported by:
  4. 4. COpyRIghT © 2009 AIDE 1102-7002 K This document is provided by Dubai press Club and pricewaterhouseCoopers for guidance only, and does not constitute the provision of legal advice, accounting services, investment advice or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional advisers. Before making any decision or taking any action, you should consult a professional advisor who has been provided with all the pertinent facts relevant to your particular situation. The information is provided “as is”, with no assurance or guarantee of completeness, accuracy or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability and fitness for a particular purpose . Dubai press Club holds all copyrights to this report and no part thereof may be reproduced or replicated without prior explicit and written permission. In producing this report, Dubai press Club was assisted by pricewaterhouseCoopers. pricewaterhouseCoopers refers to the network of member firms of pricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity. All rights reserved. Requests for permission should be addressed, in writing, to Maryam bin fahad, Dubai press Club, p.O. Box 39333, Dubai, UAE (email: for additional information or to acquire further copies of this publication please visit or ISBn: 978-9948-03-893-1 2102-80 4 hTwO
  5. 5. BARAARAB MEDIA OLTUOOUTLOOK 2008-2012 Prepared by Dubai Press Club, Dubai Media City, Dubai Studio City, International Media Production Zone and PricewaterhouseCoopers The Dubai press Club plays a vital role in the growth of the regional media industry through its many initiatives including the annual Arab Media forum and the Arab Journalism Award. Dubai press Club is dynamically involved in key issues affecting Arab journalism and regularly organises training workshops as well as hosting seminars on topics of regional and global significance. As a founding member of the International Association of press Clubs it is a thriving forum for the exchange of ideas. Over the past seven years, Dubai Media City (DMC), Dubai Studio City and the International Media production Zone have established themselves as the region’s leading media hub. with a thriving media community of over 1,200 regional and international media companies and hundreds of media freelancers, DMC is a place where every kind of media business can operate with collective synergy, including: publishing, music, film, new media, leisure and entertainment, broadcasting, media and marketing services and information agencies. DMC provides an advanced infrastructure for media-related businesses to operate globally out of Dubai. pricewaterhouseCoopers provides industry-focused assurance, tax, and advisory services to public and private sector clients. More than 146,000 people in 150 countries combine their thinking, experience and solutions to build public trust and enhance value for clients and their stakeholders. The firm’s Arab network has 21 offices in 13 countries. 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 5
  6. 6. DORppRODUCTIOn f nKCAACKnOwLEDgEMEnTS ST For Dubai Press Club Maryam Bin fahad, Executive Director Omar Dusuki, Strategy planning Director Ibrahim Khayat, Senior Consultant Shajahan Madampatt, Content Development Specialist Mohab Mazen, Senior Events Management Executive nour Aldin Al yousuf, Events Management Executive Abdulaziz Abdullatif Sadeq, Events Management Executive Ibrahim Ustadi, Awards Executive Ahmed Khaled, Customer Relations Coordinator Musab Zakarya, Editorial Manager-Arabic Contact: For TECOM Investments Sanjive Khosla, Chief Strategy and Business Development Officer Russell Sy, Executive Director of Strategy & Business Development Lindsay Miller, Director of Media Strategy & Business Development Contact: For PricewaterhouseCoopers Marcel fenez, global Managing partner, Entertainment & Media practice hazem galal, partner Ian Sanders, partner Elaine Lui, Senior Consultant Sarah wazzi, Senior Consultant Jason wang, Digital Media and Technology Consultant Contact: Project Editor Kelly McCarthy, Third Millennium publishing Contact: 2102-80 6 hTwO
  7. 7. ELBATTABLE Of ETnOCCOnTEnTS 08 foreword: Dubai press Club 09 foreword: TECOM Investments 10 foreword: pricewaterhouseCoopers 11 Acknowledgements 12 Executive Summary – Arab Media Outlook 2008-2012 16 Section One: Worldview 17 Emerging trends and industry response 26 Infrastructure: the enabler of convergence 33 The impact of UgC – The changing face of media 35 Content packaging 35 Measurement and targeting 36 Content distribution 37 Audience measurement issues 37 how new media is changing traditional media 42 Collaboration 43 Section Two: Regional Update 44 Regional characteristics and dynamics 53 Circulation trends 57 Advertising revenue trends 75 Section Three: Unlocking value – the technology challenge 76 Regional developments 91 Implications for government policy makers and sector regulators 92 Implications for traditional media 95 Annex: Methodology 96 Methodology for advertising spend projection 2008-2012 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 7
  8. 8. EROffOREwORD – – DR IABUDDUBAI pRESS CLUB STnEMTSEvn Dubai press Club is proud to present the second makes the adoption of digital technologies a edition of Arab Media Outlook 2008-2012. In this natural development for the region. year’s Outlook we review the changing nature of media in general and the effects that technology In this Outlook, we have also looked at the is having on media across the region. emergence of user-generated content in the region. we believe the surge of citizen Besides analysing the interface between media journalism that we see today in the region will and technology, the Outlook also predicts the complement “mainstream journalism” and changes and trends that are expected in the add to the depth and breadth of media content. media industry over the next five years. The we have seen many prominent examples report covers all media sectors and examines of citizen journalism recently, both locally key user trends. Our analysis of the region’s and internationally, that confirm that digital media is expanded to include twelve countries technology is transforming large sections of across the Arab world: Bahrain, Egypt, Jordan, people from passive consumers into active Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi creators of media content. Arabia, Tunisia, UAE and yemen. none of our work would have been possible In keeping with our commitment to provide without the kind cooperation of key members of an accurate assessment of media trends in the media industry. we thank them all for their the region, we asked our Knowledge partners, time and insight. Their input was particularly pricewaterhouseCoopers, to work with us valuable in our understanding of statistics to develop a better understanding of how where publicly cited data are not always as global developments are being brought to accurate as they appear. we are confident that, market in the Arab world and how our regional as with last year’s Arab Media Outlook, our media businesses can benefit from the projections accurately represent the trends in latest technologies. we have great pleasure the twelve countries we reviewed. in reporting that the Arab region is well positioned to keep pace with the global trends Our research indicates that the Arab media of collaboration and convergence, although the industry is going through a period of renewal degree of adaption to the changes differs from and regeneration in terms of technology and country to country. content although there are challenges along with the opportunities. The latest challenge to This Outlook includes growth trends for both surface is the unprecedented financial turmoil digital and traditional media and also looks in the global economy. Media cannot remain at ways in which Arab media operators and untouched by these developments so we regional governments can invest in new thought it prudent to include the implications of technologies to add value throughout the the upheaval for the Arab media industry. I am industry’s value chain. you will see that the new sure the insights and analyses, as well as the technologies have unlocked immense value for data and projections contained here will serve new and traditional media, in ways that were as a reliable source of reference for media unthinkable a decade before. The fact that a experts, policy makers and the general public majority of citizens in Arab countries are young throughout the region and further afield. Mona Al Marri, Chairperson Dubai Press Club 2102-80 8 hTwO
  9. 9. wEROffOREwORD – MOCETTECOM InvESTMEnTS The TECOM Investments media cluster—Dubai we hope that this edition of the Arab Media Media City (DMC), Dubai Studio City (DSC) Outlook provides valuable insights that will and the International Media production Zone influence decision-making within media (IMpZ)—represents a realisation of the vision companies, infrastructure providers and of his highness Sheikh Mohammed Bin Rashid policy-making bodies across the region. There Al Maktoum, UAE vice president and prime is no doubt that the Arab world is attracting Minister and Ruler of Dubai to transform Dubai global acclaim for the growth of its media into a knowledge-based society and economy industry and we must all work together to and to develop Dubai as the media hub for the maintain the forward momentum of recent Arab region. years. Complacency is not an option. It is Over the past seven years, Dubai has developed clear that the media consumer in our region a unique global media community that is as sophisticated as those anywhere in the provides a strong regional platform for media world, and it is essential that Arab media companies. Our investment in infrastructure companies respond to the needs of the new and the wide range of significant business media consumer as well as continuing to satisfy incentives offered by DMC, DSC and IMpZ the large population segment that happily have generated an expansion in the media receives their news and entertainment through community that includes over 1,200 regional traditional media channels. and international media companies and with its key economic data, credible research hundreds of media freelancers. and astute analysis of emerging technology The media industry has also been expanded as it relates to the media industry, the Arab through DMC’s sister organisations: DSC, Media Outlook is an essential tool for all which is dedicated to filming and broadcasting media companies in the region. The media industries; and IMpZ, the world’s first free zone business model is changing and there are to bring all elements of the printing, publishing many opportunities where technology can and graphic art industries into one geographic unlock value for media companies in the Arab cluster. we thank all the media companies who world. Information contained within Arab Media are now part of this wonderful growth story and Outlook 2008-2012 will help us all to achieve invite media companies who are not yet a part this. of the Arab media scene to come and join us. Dr. Amina Al Rustamani Executive Director of Media, TECOM Investments 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 9
  10. 10. EROffOREwORD – STnEMEgDEL ECIRppRICEwATERhOUSECOOpERS It is our great pleasure to welcome you to this, Digital media will thrive in the Arab market the second Arab Media Outlook, which covers because the market has a large, technologically the projection period 2008–2012. working accomplished demographic group—its youth— closely with the Dubai press Club and TECOM who are comfortable with it and will customise Investments we have kept the promises we it to their own requirements. The digital future made in last year’s AMO and have expanded this is now clearly the digital reality, and its impact edition to include six more Arab countries, as is being seen across many industry sectors. well as examining the use of new technology in the region and reviewing new media channels. The media industry is dealing with a range of emerging business models that are affecting This Outlook covers the current status and participants across the content production and future prospects of the Arab media industry distribution value chain. These developments with a focus on the emerging trends of reflect the emergence of a new type of convergence and collaboration. we have consumer who wants “anytime, anywhere, maintained a largely consistent format with last anyhow” access to media. notwithstanding year so that year-on-year comparisons may be such trends, traditional and physical media obtained. formats are still growing strongly and continue to form the backbone of most of the industry There is tremendous potential for the media segments covered in the Arab Media Outlook. industry in the Arab region. from work The ever-expanding Entertainment and Media conducted on our global Entertainment industry continues to provide opportunities & Media Outlook we know that the Arab for entrepreneurial innovation as well as for entertainment and media market is growing collaboration across the entertainment, media faster than any other region. Traditional and communications value chains. media such as newspapers and television are performing in line with the strong growth we would like to thank everybody involved in of the region’s economies and are achieving the research and feedback that enabled the growth rates that are the envy of the rest of preparation of this report. we are proud to the global industry. Digital media are also be associated with the Dubai press Club and growing although there are variations across TECOM Investments and thank them for the the region depending largely on differences in opportunity to work with them on this project. the level of development of broadband access infrastructure. Opportunities for investment in this area abound. Marcel Fenez Global Managing Partner Entertainment & Media Practice PricewaterhouseCoopers 2102-80 10 hTwO
  11. 11. OnKCAACKnOwLEDgEMEnTS Dubai press Club and pricewaterhouseCoopers would like to thank the following media organisations for their kind participation in the compilation of Arab Media Outlook 2008-2012. Ad-Dustour newspaper, Jordan Cnn, International Agency news, Morocco Dar Al Sada, UAE Al wasat newspaper, Bahrain Du, UAE Al Ahram newspaper, Egypt Egypt Radio Al Akhbar newspaper, Egypt Emirates International Telecommunications (EIT), UAE Al Akhbar newspaper, Lebanon Es Sahafa newspaper, Tunisia Al Alam newspaper, Morocco french news Channel, Morocco Al Arab Al yawm newspaper, Jordan International Advertising Association (IAA) Al Arab newspaper, Qatar Jordan Tv Al Arabiya Tv, pan Arab Laha Magazine, Lebanon Al Ayam newspaper, Morocco Lebanese Broadcasting Corporation (LBC) Al Balad newspaper, Lebanon Lebanon Radio Al ghad newspaper, Jordan Le Renouveau newspaper, Tunisia Al hayat newspaper, pan Arab MBC group Al hurra Tv, pan Arab Mediaedge:cia Middle East Al Jazeera Children’s Channel, Qatar Middle East Communications network (MCn) Al Jazeera Media Training and Development Centre, Qatar Mindshare, UAE Al Jazeera printing and publishing Company, Saudi Arabia MTv, Morocco Al Madina newspaper, Saudi Arabia national Tv and Radio Broadcasting, Morocco Al Manar Tv, Lebanon new Tv Al Masri Al youm, Egypt nielsen Al Mawkif newspaper, Tunisia nusf Al Duniya Magazine, Egypt Al Qabas newspaper, Kuwait Oman Establishment for press, publication and Advertising Al Rai newspaper, Jordan Oman Observer newspaper Al Raya newspaper, Qatar publicis groupe, UAE Al Riyadh newspaper, Saudi Arabia Qatar news Agency Al Sahifa Al Maghribia newspaper, Morocco Reuters, International Al Shabiba newspaper, Oman Saudi Research and Marketing group (SRMg) Al watan newspaper, Oman Starcom Mediavest group Al watan newspaper, Saudi Arabia TECOM Investments, UAE Arab Journalists Union, Egypt Unilever, UAE Arab Media group, UAE Universal Media, UAE Arab news newspaper, Saudi Arabia weghat nazar Magazine, Egypt As Safir newspaper, Lebanon yemen general Corporation for Radio and Tv Bahrain Tv yemen Journalists Union Cairo Sat and Cairo news Company (CnC), Egypt yemen news Agency Chada Radio, Morocco yemen Observer Centre for Arab women for Training and Research yemen Today (CAwTAR), Tunisia 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 11
  12. 12. XEEXECUTIvE USSUMMARy 2102-80 12 hTwO
  13. 13. we are pleased to present the second edition of vehicle navigation devices, UMpCs (ultra-mobile Arab Media Outlook. In this year’s edition, Arab pCs), Apple ipods (and similar devices) and Media Outlook 2008-2012, we have expanded e-book readers. we point to the emergence of the publication to encompass the vibrant media mobile television—the delivery of broadcast markets in twelve Arab countries from the television to mobile devices—as a powerful Atlantic to the Arabian gulf: Bahrain, Egypt, means of distributing premium content. Mobile Jordan, Kuwait, Lebanon, Morocco, Oman, television represents an attractive commercial Qatar, Saudi Arabia, Tunisia, the UAE and opportunity for content producers and owners yemen. we also look at developments relating and for mobile-network operators. to Arab publications and television broadcasters that cover all, or part of, the region. The power of mobile internet and mobile television is that it allows consumers to As in the first Arab Media Outlook, our focus is be connected to their content “anytime, on “the business of media”. In particular, we anywhere”. This is particularly relevant to the look at how global technology developments are “net generation”, the new generation of young impacting the media business in the region and consumers who have grown up with the internet at the opportunities that these developments and for whom mobile phones are an essential present for media companies to unlock value part of life. across the content creation and delivery value chain. In Section Two: Regional Update we analyse how global and regional developments are In the first edition we also looked at a number impacting Arab media. we focus on factors of factors affecting revenue and profitability that directly drive revenues and profitability growth in the global media sector and how for the sector. first, we look at the economic these impacted the media sector across the and demographic trends that affect all sectors Arab region. Our study included demographic of the economy but which have a particularly and economic forces that impact all areas of the strong impact on the media, and then we assess economy, as well as the forces of convergence the effect on the region’s media sector of the that are specific to the media, entertainment, global trends considered in Section One. Among telecoms and technology sectors. In particular, the issues which we cover are the impact of we focused on the rapid development of web mobile and broadband penetration on the 2.0—the emerging second generation of delivery of digital content, the effect of literacy internet services—which is being powered by rates on the development of the print media, various forms of user-generated content (UgC) the impact of changes in press legislation and and the growth in mobile telecoms as this is the strong growth in outdoor advertising across likely to be the future preferred means for the region. accessing the internet in most countries in the region. A common feature across all twelve of the markets that we studied is that young This year, in Arab Media Outlook 2008-2012, people make up a relatively high percentage we build on these themes. In Section One: of the population. In some countries, over worldview, we consider the development of 50% are less than 21 years old and all web 2.0 business models and web-enabled countries have a large youth segment that technologies that facilitate collaboration is particularly receptive to new media. between content owners, software developers pricewaterhouseCoopers global media and and the end user. UgC, as both a contributor entertainment research indicates that the and a rival to conventional news and “net generation”, regardless of its geographic entertainment media, is one high-profile location or cultural background, tends to aspect of this. we look at how traditional print behave in a very similar way when they and broadcast media are responding to these are online. They are comfortable with new developments. technologies and prefer the speed and variety of content delivered through online and mobile we then look at the repackaging and delivery channels. All they need is the right broadband of news and entertainment services via low- infrastructure in place to access the internet. cost, mobile computing devices connected The positive news for media owners and to the internet via wifi and third-generation advertisers is that younger media consumers mobile networks. These include smartphones, are also likely to spend a higher proportion of 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 13
  14. 14. their income on media consumption and their assumptions compared with those used in last mobile phone is considered a necessity, not a year’s publication. luxury item. In the light of the global developments outlined In the same section, we show illustrative in Section One and the review of national projections for future circulation and advertising markets in Section Two, we focus in Section revenues for the twelve national media markets Three: Unlocking value—The technology covered in this outlook. for each country, challenge on how technology has released we comment on how the market trends are value for both digital and traditional media. impacted by global developments and by factors In this section we look at how technology has specific to the individual national markets. the potential to unlock value right across the content creation and delivery value chain, A key question now facing the region’s media and at the state of the required technology sector is the extent to which it is exposed to infrastructure in the countries covered by a potential slow down in economic growth this Outlook. we then consider the role of resulting from the global financial crisis and governments in stimulating investment in these lower oil prices. The region’s economies areas. finally, we look at the implications for have recently enjoyed very strong growth, traditional media companies in the region. particularly in the oil-producing gCC countries that benefited from the historically high oil Our analysis points to significant opportunities prices that peaked early in 2008-Q3. The non- for media companies in the region to use the oil sectors have benefited in turn from the power of web 2.0 to develop new revenue impact of oil-financed public spending and streams and to maximise the value of both new from policies to diversify economies and reduce and existing premium content. Distribution to dependence on oil revenues. The most obvious mobile broadband devices including mobile manifestation of this growth (and one of its television will play an important part in this. main drivers) was the surge in activity across Another priority area is the development of the property sector throughout much of the audience measurement processes for both region that has been closely linked to cheap print and broadcast media. The absence of and readily available bank credit. Along with reliable audience figures makes it difficult for telecommunications and financial services, advertisers to target their advertising and to the property sector is the largest spender on assess its effectiveness which reduces their advertising across the region. All three sectors willingness to spend. are likely to be impacted by a downturn in economic growth. Our assessment of priorities for traditional print and broadcast media companies, network The projections in Section Two were produced operators and government policy makers and before the impact of the global financial crisis regulators is summarised below on the regional economies, and hence on the media sector, had begun to be felt. The impact Priorities for traditional media: of the crisis and of the associated fall in oil prices in the second half of 2008, on the region’s • Develop strategies for online and mobile economies is likely to be complex and both the content production and distribution extent of the impact and its timing are as yet • Review archive entertainment content and unclear. A full analysis of the impact is well assess potential for mobile distribution beyond our scope for the Arab Media Outlook • Repurpose content for distribution to mobile 2008-2012, but it is clear that it will affect the devices economies of every country examined in this • Develop “snack Tv” content for mobile-Tv publication and it is likely that this impact will distribution be uneven, with economies most closely linked • Develop best-practice online presences to the global economy and most exposed to incorporating interactivity, RSS, video etc. movements in oil prices being affected the • Strengthen online profiles for star journalists most. given the current uncertainty, we have and columnists – e.g. using video podcasts based the projections on relatively conservative • Enter into content distribution agreements with mobile telecoms operators • Commence implementation processes for audience measurement 2102-80 14 hTwO
  15. 15. • Initiate dialogues with governments and regulators on the “digital dividend” -- the re-allocation of spectrum currently used for analogue terrestrial television broadcasting Priorities for network operators: • Expand broadband coverage and quality • Increase the region’s connectivity to the global internet • Build micro-payment payment platforms for digital content Priorities for government policy makers and regulators: • Actively monitor global developments in content creation and distribution • Create the regulatory environment required to encourage broadband investment • Licence mobile-Tv network operators • Initiate dialogues with the private sector on the “digital dividend” • Develop practical training programs for Arabic media professionals at all levels The scope of this publication currently reflects the media side of the wider entertainment and media business. In practice, the two sectors are very closely related and a number of our conclusions, for example those relating to mobile television and the mobile internet, are also directly relevant to the entertainment sector. This sector is becoming increasing sophisticated in the region and is growing very fast in a number of cities with the building of sophisticated theme parks and concert venues capable of attracting top international artists. Entertainment content is increasingly important to the region’s print and broadcast media and is crucial for attracting advertising spend. It will also be crucial to the development of online media. This is the second Arab Media Outlook. we have chronicled a wide range of exciting developments and pointed to the great potential for growth of the media sector across the region. next year we will expand our coverage to cover aspects of the entertainment sector that directly impact the media, add coverage on mobile television developments and look at the impact on the region’s media sector of the global financial crisis. 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 15
  16. 16. ESSECTIOn OnE: wwORLD vIEw 2102-80 16 hTwO
  17. 17. In last year’s publication, Arab Media Outlook of satellite Tv across the region and the 2007-2011, we looked at a number of factors continued growth of conventional print media affecting revenue and profitability growth in although the latter is constrained by relatively the global media sector and how these factors low literacy levels in some markets in the impacted the media sector across the pan- region. Arab region. Some of these factors are general in nature, influencing most sectors of the Web 2.0 and user-generated content economy; some are specific to the media sector. This year we build on these themes. Our we pointed first to the importance of general analysis of the economic and demographic economic and demographic developments, factors that continue to have a major both of which strongly support growth in influence on the media sector in the Middle media sector revenues in the region. Strong East is updated in Section Two of this year’s population growth in most Middle East publication. In Section One we focus on two markets, particularly in the key 15-25 age areas having an increasingly strong influence group, is increasing the addressable market on the media sector in developed markets of those consumers most likely to adopt new and which we expect to become increasingly technologies and to experiment with new ways relevant across the pan-Arab region. of accessing content. Strong economic growth, driven by historically high oil prices and by first, we consider the development of web 2.0 economic diversification policies, has created business models and web-enabled technologies high levels of disposable income, which feeds that facilitate collaboration between content both consumer media spend and advertising owners, software developers and the end- revenue. user. UgC, as both a contributor and a rival to conventional news and entertainment media, Emerging trends and industry response is one high-profile aspect of this. we look in particular at how traditional print and broadcast we drew attention to powerful forces of media are responding to these developments. convergence across the media value chain and the rapid development of web 2.0, the emerging Secondly, we look at the repackaging and second generation of internet services, delivery of news and entertainment services via including social networks and content-sharing low-cost, mobile computing devices connected sites powered by various forms of user- to the internet via wifi and third-generation generated content (UgC). These developments mobile networks. These include smartphones, have resulted in the emergence of media vehicle navigation devices, UMpCs (ultra-mobile exchanges such as facebook, MySpace and pCs), Apple ipods (and similar devices) and youTube which are already international e-book readers. household names and have challenged the established media’s business models that had Unlocking value remained largely undisturbed for a generation or more. A particular focus of this section is how technology has unlocked value for both new and we also looked at the response of traditional traditional media. we highlight lessons industry media companies, both in their investment participants have learned from managing and in new media companies, and also their facilitating the user experience as consumers development of new online channels to access content offline, online, in their homes, customers and their adoption of UgC as a workplaces, public places and on the mobile complement to conventional professional internet. Their use can be summed up as, content. we noted that these developments “anything, anytime, anywhere”. were starting to have some positive impact in the region but that this was constrained by the web 2.0 technologies and business models are lack of affordable broadband access in most challenging news and entertainment content markets. In the absence of fixed broadband production and delivery, yet also present access we pointed to the important role of opportunities for existing content owners, mobile services in the region as potentially service providers and network operators across being the future preferred route for accessing the emerging new media value chain. the internet. we also pointed to the dominance 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 17
  18. 18. Mobile internet and advanced messaging What is Web 2.0? services will be a major source of future growth for mobile telecoms operators. This web 2.0 is a trend that aims to facilitate growth requires access to a range of new data collaboration amongst users, service services for mobile customers that go beyond providers and software developers. These the simple short messaging services (SMS) that concepts have led to the development currently comprise the main source of mobile and evolution of web-based communities data revenue. Some of these services will be and hosted services such as social- similar to those available on the fixed internet networking sites, wikis, blogs and meta- or television but will be available “anytime, tagging. anywhere” on mobile devices. Other services will be developed specifically for mobile devices. Although the term web 2.0 suggests a new version of the world wide web, it Implications for investors actually refers to changes in the ways software developers and end-users new methods of content production and use the internet. Coined by influential content delivery continue to have far-reaching technology publisher, Tim O’Reilly, implications across the media value chain, web 2.0 is a strategic response by providing new channels of revenue generation entrepreneurs and established industry as well as lower costs for content creation participants. As the battle for limited and distribution, but they also raise concerns consumer attention continues to intensify, regarding intellectual property protection and traditional and new media participants are the appropriate compensation for creators of developing new methods to engage and original content. collect information on the consumer. By understanding these trends, investors The underlying principle behind web across the new media value chain can make 2.0 is to generate network effects by informed strategic decisions. Investments in allowing application development to infrastructure such as the access network and become open sourced. By allowing their media production facilities will provide the key data to be accessible, companies enable connectivity for these new broadband services. open-source developers to combine The ease-of-use and responsiveness of these information in new and unique ways services are key factors in successful revenue- thereby increasing the intrinsic value of generating media products. Regional content their content. producers and distributors, broadband network operators and smart-city infrastructure web 2.0 services leverage the viral investors have the opportunity to exploit the nature of social networks to enable commercial potential of these services by the distribution and creation of content establishing early positions in the development relevant to a specific niche, in a self- of domestic infrastructure sustaining manner. By providing a framework for interactivity between The impact of Web 2.0 users, the aggregate network effects allow web 2.0 sites such as social web 2.0 technologies and services have networks to generate large volumes of transformed the internet into a platform valuable psychographic data which can be enabling collaborative access to a wide range leveraged for highly targeted advertising. of media and entertainment services that consumers now use on a daily basis. The current generation of consumers, particularly teenagers and young adults, are constantly creating and sharing content through instant messaging, social networking sites and their mobile phones. 2102-80 18 hTwO
  19. 19. 1 wORLD vIEw Much of the recent focus of attention on web 2.0 Mobility and the new generation content has concentrated on the tremendous of convergent services volume of creation, posting and viewing of video content on media marketplaces such The steady pace of convergence has led to a as MySpace, Orkut, youTube and facebook. series of new services where mobility, time- In 2007, this activity led to a number of high- and place-shifting are the keys to growth. profile transactions including the purchase of During the last few years, we have seen the youTube by google for US$1.65 billion and the adoption of subscription services that allow US$250 million advertising commitment from consumers to time-shift and place-shift music, Microsoft to facebook. games, movies and television programmes. Services such as TIvO and iTunes allow with tens of millions of unique visitors a day, consumers to record or download content to social networking sites have become important their personal computers for consumption marketing channels. This has transformed at their own convenience. Meanwhile, Sony many of these new start-up companies into has begun to offer its massive content library serious competitors for advertising dollars. for purchase through the Sony playstation 3 furthermore, telecommunication companies gaming/home media center platform. are expanding their business models beyond voice and internet gateway services into the Time-shift delivery of high definition (hD) video via internet protocol television (IpTv). Recording and watching content at a time convenient to the individual. for example, During 2008, media companies increasingly by recording a Tv show on a digital video embraced web 2.0 for content production and recorder. delivery as well as teaming with new media companies and device manufacturers to take their programmes beyond the Tv screen. As consumers continue to “snack” and maintain Place-shift a greater constant online presence as they “multi-task”, industry participants must Copying television content to digital address how they can measure, and then turn, media to watch anywhere. for example, the value of the massive amount of content downloading a favorite television program being generated into a profitable business. The to watch later on an iphone. following sections of this report will explore these issues. Recent developments have expanded the range Snacking of mobile devices that feature broadband wireless data connectivity, featuring faster habit of net generation to self-package processors, wi-fi connectivity, wide-screen content from the internet or Tv and touch-sensitive (haptic) screens and gpS consume it anywhere they want. functionality. Devices such as the Blackberry and the iphone are examples of the commercial acceptance and success of mobile-enabled content. The trend is clear: manufacturers, Multi-tasking operators and content providers are testing new ways to capture value from the “net generation” Consuming different types of content consumers that are willing to pay for content simultaneously. for example, watching Tv “anytime and anywhere”. and surfing the web at the same time. 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 19
  20. 20. Pure play over a seven-hour period. Statistics are even higher for the technologically competent and where users of the service create all the well-equipped youth of Asia pacific. These content produced. consumers actively multitask their way through social networking sites, UgC, music listening, video games, television and other content Potential for traditional media Current TV - Pure play UGC By 2007, time-shifting and place-shifting of Short form television programs such content became commonplace. with a wide as, “America’s funniest home videos”, range of mobile-enabled devices available or “you’ve Been framed!” have existed to the consumer, it became possible for the for well over ten years but have never consumer to take content anywhere and view expanded beyond Tv. it at their convenience. This potential still remains largely untapped by traditional media while the commercial success of and represents a tremendous opportunity for broadcasting pure-play UgC has yet to industry participants to take on the challenges be fully validated by the market, industry of customising content for the mobile participants continue to experiment. environment. Cable channel startup, Current Tv, (founded by former US vice president Al gore) is one of the first to create an entire channel around UgC. Current The importance of Tv is unique in that it provides free a commuter culture training to all its content contributors. The site provides extensive training for Cities with high population densities, young producers on the ins and outs of such as Tokyo and Seoul, have large content production from storyboarding to portion of the population who regularly sophisticated film techniques. use mass transit. Commuters represent a population of consumers who typically Established in 2005 in the United States, have idle periods ranging from a half an it has expanded into the UK on satellite. hour to an hour each day. In a similar move, Cablefox is running MySpace video content on their fX Capturing this idle time is a significant branded channels. opportunity. The initial success and continuing success of nTT DoCoMo’s iMode mobile data services can be The “net generation” comprises young attributed to the service’s ability to consumers born after 1977 who have grown up capture idle time by meeting the news & with the internet and mobile communications entertainment needs of this segment. and have a strong and diverse appetite for Consequently, for the next generation of content. This is both a result of convergence services, which includes mobile television, and one of its main drivers. Members of the net many mobile operators with high-density generation have come to expect services that populations are actively optimising these give them control over the times and places services and their programming offering where they consume content. They have the for their commuting consumers. ability to self-package content and services into “bite-size” pieces for future consumption. Recent studies conducted by pricewaterhouseCoopers in the United States provided several insights into consumer viewing behaviour. where parents consume 20 hours a week watching television, members of the net generation can consume 20 hours of media every day, all of it consumed in parallel 2102-80 20 hTwO
  21. 21. 1 wORLD vIEw Infrastructure has been key to this commercial versions of repackaging software development. The wide availability of high- found on the internet and often integrate them speed broadband internet access allows into their operating software. Examples include consumers to download and share their Microsoft’s windows Media Center and Apple’s favorite television programmes, movies, music iTunes and AppleTv offerings that allow users and related content via their pCs or mobile to share their content within a discrete wireless devices. Deep broadband penetration in north network or amongst friends. America, Europe and Australasia has created a generation of consumers that has been Changes in behaviour educated to go online to meet their content needs. Driven by lifestyle considerations, The effort to make the repackaging of content consumers are repackaging content taken from easier is a key focus of content owners as traditional channels and digitalising the content they attempt to wean users away from the for their anytime, anywhere lifestyles. freeware/shareware tools that they currently use to self-package content and shift those Until recently, content consumers were potential consumers toward corporate content essentially tied to their Tvs, pCs or game channels. while some companies have forgone consoles but with the advent of personal video/ the expense of implementing digital rights gaming platforms such as the Apple ipod Touch management on their content, the important and convergent mobile phones from vendors change in behaviour is how they are selling such as nokia, Samsung, Sony-Ericsson and content. Industry participants have begun Apple, the transportation and viewing of content to do away with the sale of content online in during free time has been made considerably an album or series format. In most cases, easier. The following section provides an consumers can now purchase individual songs overview of how consumers and the market are or television episodes. Industry participants changing. have also focused on developing user interfaces that assist in the search for content through Repackaging of content the creation of customised playlists that rely upon the extensive use of meta-tagging. for Mass digitalisation of content has quietly example, in 2007, nike and Apple collaborated revolutionised how consumers access content. on the nike+ music player for runners. This for several years the use of free media players device featured software that shuffled music such as windows Media player and Realplayer into playlists specific to the sport enthusiast’s has enabled the portability of content that lifestyle or training needs. from movies to started with the proliferation of Mp3 music files. games to music, consumers are only limited by data storage, battery life and the bandwidth of Open-source software products with easy- their mobile devices. to-use interfaces are widely available on the internet and have made it possible for Consequently, these new media services have consumers to “rip,” i.e. digitise, content from generated volume sales of individual songs, various sources. for example, a wide range of movies and Tv episodes as well as compilation music and video content can easily be found albums and full-season subscriptions. online using peer-to-peer file-sharing tools This has been a successful business model such as BitTorrent. Despite a number of high- generating new revenues from library titles. profile lawsuits against network providers The ‘re-captured’ revenues represent what and individuals by the Recording Industry were effectively ‘lost revenues’ from a market Association of America and the Motion picture segment that had successfully pirated content Association, and the widespread use of digital that it wanted. rights management software, the availability of copyrighted content and the software to Embracing the snack culture repackage it remains easily available and piracy continues unabated. Computers networked By 2007, traditional media was embracing the over the internet continue to distribute games, snack culture by diversifying the channels music, film, and television content that meets where their content could be seen. notably, a wide range of consumer niche interests. This broadcasters provided prime time content as desire for control is well known to operating well as library titles across multiple distribution system software corporations who also provide platforms ranging from their own streaming 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 21
  22. 22. yDU websites to third-party content distribution platforms via IpTv platform resellers such as Amazon Unboxed. BBC’s highly successful iplayer service allows free streaming of high-quality news and entertainment content to UK viewers. In a 2007 landmark collaborative venture, broadcasting competitors nBC Universal and fox Television launched an IpTv platform branded to leverage their combined content libraries. By the 2008 Beijing Olympics, the provision of live, free content from the broadcasters had become commonplace in the United States. 2102-80 22 hTwO
  23. 23. 1 S ESACCASE STUDy wORLD vIEw At a Glance: Subject: Radiohead Established: 1993 headquarters: England Media type: Online music sales focus: Remodelling the recording industry URL: Recording artists are beginning to take during the first month of release approximately advantage of changes in consumer buying 40% of fans paid for the album at an average behaviour. following the expiration of their price of US $6-$8. recording contract with a traditional music The band recovered 100% of the revenue label, popular UK rock band, Radiohead, generated, as they did not have to share launched their seventh album, “In Rainbow”, ownership with a record label. The revenue in October 2007. for a limited period the recovered stands in sharp contrast to the typical band made their album available as a 50-60% of gross revenue retained by the record digital download online and did not set a label. Because the band also retained the rights price for its purchase. Instead, they allowed to the master, Radiohead is now selling the consumers to pay what they felt was “fair album via traditional means as part of a boxed value” for the music. set. Although the band has declined to comment The album continues to engage consumers officially on the exact success of this through Radiohead’s online presence on their experiment it should be noted that the Dead Air Space interactive website where they album entered the UK’s Album Chart and the have recently adopted a user-generated video US’s Billboard 200 at number 1. In various as the official animation for one of their “In interviews with the artists they reported that Rainbow” tracks. 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 23
  24. 24. In the recorded music sector, MySpace has Diversification of broadband grown from a generic social networking site into a marketplace for emerging, independent Radio stations have also aggressively time- artists. An increasing number of traditional shifted and place-shifted their content by performers opt to distribute their content providing content online and leveraging online. Even established classical music brands technologies such as real-simple syndication such as the new york philharmonic sell live (RSS) to notify their audiences when a show is concert recordings on Apple’s iTunes online available to download. Similarly, the publishing music store. Some established performers sector has also seen transformation. for have taken steps to end long relationships with example, the Economist and fashion magazine their record labels. UK rock band, Radiohead, Elle now feature video podcasts of editorials not only released their latest album online but and columnists to enhance brand stickiness. allowed consumers to choose how much money Consumers can listen or watch their favorite they were willing to pay for it. (See Case Study.) columnists on their mobile devices during their weekday commute. The financial Times has gone further than this with an extremely MySpace – online success developed online presence that allows the premium user to access a wide range of high- Colbie Caillat, a 22 year-old Californian value business content via specialized mobile singer-songwriter launched her career clients. These shifts represent a considerable by posting her songs on MySpace. One shift in management thinking by traditional song in particular—“Bubbly”—went viral, media. generated millions of plays and was picked up by the mainstream media. with Client a huge existing fan base, negotiating a deal with a traditional recording label Software applications that reside on gave the performer greater control over mobile phones that are designed to her musical direction and her first album “push” or “pull” content from a file server “Coco” featured content that had proven as per the needs of the end-user. appeal. 2102-80 24 hTwO
  25. 25. 1 wORLD vIEw In music and video, a wide range of low- to Citizen journalism high-cost digital media players exists, from the Apple ipod Touch to the yepp from Samsung. Launched in 2007, Cnn I-Reporter however, mobile phones are increasingly represents an early attempt to leverage dominating what was once a market for the UgC trend by creating an official dedicated music or video-playing devices. online platform to aggregate first-hand Mobile phones have converged into music news accounts. The brand became and video devices. with approximately 2.2 more widely known when Cnn paid an billion mobile subscribers globally, 33% of the undisclosed sum for exclusive rights to world’s population is mobile enabled. with the a video clip uploaded by a student during convergence of these devices we are seeing an the virginia Tech student shooting incident even greater range of possible permutations in 2007. as evidenced by Apple’s iphone 3g and nokia’s n-series consumer smartphone which The success of the I-Reporter platform integrate a wide range of functionalities into a has led other broadcasters to incorporate single device. UgC platforms into their operations. In September 2008, CBS news, an American UGC meets mobility network broadcaster, began distributing free software to enable citizen views, These same devices not only transport content, reports and comments on submissions but also allow consumers to integrate and uploaded directly from iphone users. author content. Consumers are rarely without their mobile phones/digital cameras/content players. The ubiquity of these devices allows consumers to create and tag digital content Diversity of mobility products for sharing anywhere. It is no surprise that international news organisations such as An increasingly wide range of mobile devices the BBC, Cnn, Al Arabiya and Al Jazeera are enabled through web 2.0 technology facilitates actively encouraging consumers to submit the delivery of content and the layering of eyewitness accounts for possible broadcast. The UgC. hand-held and vehicle-mounted gpS success of citizen journalism projects such as devices now dominate personal navigation. Cnn’s iReporter is largely due to the prevalence Maps contain geo-located markers for retail of low-cost devices that enable consumers to shopping, gas stations and other commercial record and immediately share their content with points of interests. Manufacturers such news organisations for mass dissemination. as TomTom and garmin have proliferated low-cost consumer-oriented navigation devices that allow consumers to input their own destinations, further personalising the experience to the consumer’s individual needs. In publishing, Sony and Amazon launched consumer-focused online e-book stores in 2007. Amazon’s Kindle e-book reader, now in its second version, and Sony’s eBook reader allow consumers to download books wirelessly using a cellular connection into a readable device about the size of a small novel. In 2008, UK start-up, plastic Logic, announced a thin, lightweight, large-screen e-ink document storage and reader that can replace paper documents and allows users to mark up documents as they would in the real world. 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 25
  26. 26. This growth has enabled the development of The Net neutrality debate home media appliances such as the Slingplayer which allows consumers to broadcast their The exponential growth of video sharing favorite content from home to wherever they and social networks has lead to the are in the world. These hotspot infrastructure debate on net neutrality and who should investments have also enabled a wide range of bear the cost of infrastructure build new services. Starbucks, in conjunction with out. net neutrality is the principal that Apple, entered the music business by leveraging all traffic is treated equally across the their wi-fi network investments. internet and there is no discrimination In January 2008, Starbucks and Apple launched amongst users. proponents believe that the iTunes wi-fi Store and a Starbuck’s this is necessary to ensure both the branded music label allowing consumers to growth of the next generation of internet download music directly to their wi-fi-enabled services and unimpeded access to all who ipods. for the first time consumers did not use it. need to be connected to their home pC in order to purchase music. Starbucks worldwide coffee Critics of net neutrality posit that the shops became music retailers and dramatically shaping of specific traffic is necessary to changed consumer-purchasing behaviour. ensure “quality of service” agreements between peer operators or with the Increasingly, the delivery of content will shift consumer. They also cite the rising costs away from fixed-line, broadband-connected associated with bearing such traffic pCs to the mobile device as consumers that is potentially pirated content. This demand anytime, anywhere services. In the US, debate and many others will continue experiments have been made between verizon’s and change as convergent technologies v-Cast platform with programmes such as affect the relationship between operators, ABC Television’s “Lost” and fox Television’s regulators and consumers. “24” mobi-sodes. These trials demonstrate that by collaborating, media companies can deliver compelling content customised to the mobile phone users. This venture demonstrates Infrastructure: the enabler for convergence the symbiotic relationship that advertisers, distributors and the telecom operators must Depending on which method is used to measure achieve in other markets. internet traffic, various public estimates find 25-40% of backbone network traffic is Investments in high-speed wireless access comprised of video and file-sharing traffic. technologies such hSpA (high Speed packet Unquestionably, the rise of UgC and the level of Access), LTE (Long-Term Evolution), wi-MAX consumer interactivity found in web 2.0 services and mobile-Tv technologies such DMB-S, directly benefit from the heavy investment in DvB-T/h will play a key role in future content broadband access and backbone networks delivery. These technologies are dependent over the least decade. Dozens of wi-fi hotspot on the spectrum allocation and coordination companies have sprung up worldwide providing decisions made at both national and infrastructure from airports, hotels and city international levels through the International streets. Telecommunication Union (ITU). 2102-80 26 hTwO
  27. 27. 1 wORLD vIEw Mobile TV Infrastructure investment Currently, more than 50 mobile television Media-rich services require a delivery trials are ongoing worldwide. Mobile television infrastructure that can support reliable promises multi-channel DvD-quality video connections and sustain the exponential growth in a broadcast format to the handset. This is in demand. The crippling effects of the January a significant improvement from the current 2008 international submarine cable breaks in streamed content model found on third the gulf underscore the importance of network generation (3g) networks. furthermore, mobile redundancy and flexibility to ensure the flow television will use a separate frequency from of commerce is sustained both regionally and 3g, relieving network operators seeking to globally. (See Case Study in Section Three.) The preserve scarce network resources. same will apply for mobile networks delivering broadcast television. new media and traditional Telecom operators in Italy, Korea and Japan media participants are only now beginning currently represent the leading edge of to leverage the broadband and wireless providers who have commercially launched infrastructure and understand the challenges mobile television. The respective markets have involved. nevertheless, the growth of these deployed a variety of technologies ranging applications is expected to be exponential. for from terrestrial to satellite transmission. the developers of smart cities of the future, In the Korean and Japanese markets, understanding these trends will help guide competing mobile television technologies in decisions on what types of infrastructure the same market have been launched. The investments will yield the best long term Korean (TUMedia, a SK telecom subsidiary) returns. and Japanese (MBco) markets use a shared satellite-based transmission system Web 2.0, social networking and augmented by ground-based repeaters. In 2006, user-generated content closely following the Asian mobile television launches, Italy’s hutchinson 3 launched the growing in parallel with the emergence of the DvB-h-based mobile television service. The snack culture and the broadening diversity UAE is currently considering both DvB-h and of low-cost, mobile-enabled devices is the Mediaflo. (See Case Study in Section Two.) A emergence of a diverse range of web 2.0 range of technical and commercial challenges services. These services are designed to enable face industry participants as they deploy these mass-consumer interaction in such a way new services. that the content consumer is also the content creator. In the future, this interactivity will Anytime, anywhere services will also be enabled expand beyond the borders of wired internet through satellite, particularly for those areas and into mobile-enabled devices as users stay where the telecommunications infrastructure connected to each other during the course of continues to lag behind because of economic their daily lives. and geo-political reasons. for many developing nations, the backhaul network fails to meet the web 2.0 applications are typically pre-existing needs of the mobile networks, particularly in applications or services provided by companies rural areas. with increasing demand for mobile that are integrated in a common application services, companies such as globalstar and the interface to deliver added value. In this way, google-backed start-up, O3B networks, are for example, a yahoo finance page can allow upgrading and building new satellite networks users to integrate their news feeds from their to provide backhaul in these markets. O3B Bloomberg stock portfolio which is then stored networks have proposed a constellation of 16 in their personal finance program on Quicken. low-earth orbit satellites to provide backhaul Another example might be a service that allows capacities to telecoms that are building out users to find the gas station with the cheapest their mobile communication networks. (See price within a ten-kilometer radius using a Case Study in Section Three.) If successful, it handset enabled with yahoo! maps. would accelerate the pace of internet adoption and, it is hoped, entrepreneurship in those markets. 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 27
  28. 28. web 2.0 services leverage the viral nature of social networks to enable self-sustaining format through their “Choose or distribution and creation of content that is Lose” and “” voter relevant to a specific niche. By providing a participation programs by employing framework for interactivity between users, college students across the US to blog the aggregate network effects allow web 2.0 the 2008 presidential elections. These sites such as social networks to generate large collaborative efforts represent continuing volumes of valuable psychographic data which, media experiments by broadcasters to potentially, can be used to improve the targeting enable voter-candidate interaction. accuracy of advertising. Of all the web 2.0 applications, UgC and social Created outside of professional routines and networking have received the most attention. practices, UgC refers to various kinds of media Across the broadband connected world, content produced by web 2.0 end users. UgC huge numbers of consumers are spending ranges from news, gossip, podcasts and wikis an increasing portion of their time online to video blogs. The sharing of this content participating in social or blogging networks. The has been enabled through affordable internet following section will discuss the growth of UgC access and the ubiquity of mobile phones and and its impact. personal computers. without question, the most significant growth during this past year What is user-generated content (UGC)? has been seen in blogging and video sharing. The rising tide of web 2.0 services has UgC is created, for the most part, on a non- emphasised the importance of user-generated commercial basis. Users create content content as a key driver for success. web 2.0 for their friends and family, but also for a social networks generate self-sustaining potentially wider audience. UgC has become content that naturally diversifies to meet niche an important economic phenomenon since it markets. Content creators write about their first started in Korea with the 1999 launch of a likes and dislikes, which is then broadcast to social networking, blogging, music-sharing and a broader group of individuals who share their games site named Cyworld. views. The network effects generated by social networks and UgC have been the source of their widespread success. Voter-candidate interaction During the presidential primaries of the 2008 US presidential elections, youTube and Cnn collaborated to air user-submitted questions during the presidential candidate debates. Similarly, yahoo in conjunction with the huffington post and Slate magazine held an online debate entitled, “The Election ’08 Democratic Candidate Mashup.” Of the million viewers watching, approximately 15% voted on the candidate’s performance. MTv and MySpace held a virtual townhall meeting under the think.mtv brand where participants—via instant messaging— submitted questions and voted on the performance of the candidates in real-time. MTv has extended this 2102-80 28 hTwO
  29. 29. 1 wORLD vIEw Who participates, what do they create Technology unlocking value and why do they do it? A range of hardware and software technologies Connected at home and work, consumers are has enabled the success of web 2.0 services constantly in conversation with each other via and the UgC revolution. figures reported in the instant messaging or their social networking pwC global Entertainment and Media Outlook: site. Most UgC is produced without expectation 2008-2012 show that in 2007, the global internet of remuneration or profit. Content is created as advertising market expanded by 33.2%–the a means of self-expression or to achieve peer- fourth consecutive annual increase in excess group (or wider) recognition. Users, particularly of 30%–and makes up over 10% of global teenagers and young adults, are in the habit advertising revenue. of regularly updating their personal blogs with photos, new clips or simply their status Three key technology trends have allowed during the course of the day. As users update new media companies to unlock value from pages, their friends receive near instantaneous the consumer. first, the open software source notification of these additions via news feeds. movement that has enabled rapid application As their friends comment or add to those pages, development; second, the development of further notifications are sent to their network of notification software facilitating content friends. subscription; and third, the use of meta-tags, behavioural mapping and the development of UgC is distributed through free services that advanced recommendation engines. facilitate sharing of specific media types, for example: text (blogger), photos (flickr) or video Mash-up (youTube). Social networking sites also enable consumers to create real world items such The combination of two different web as calendars, mugs, t-shirts or photo books applications joined together using an through services such as Kodak’s Easy Share application protocol interface to create a or hp’s Snapfish. Additionally, traditional print new service with a unique function. media have tried to make their online content friendlier by allowing the posting of their articles to external blogs, or permitting their Open-source development has revolutionised content to be ranked by platforms such as Digg. the software development business. com. Independent and corporate developers alike are creating software development toolkits (SDKs) Increasingly, social networking sites are and application protocol interfaces (ApIs) that becoming more integrated, with programs facilitate inter-application communication such as Twitter updating the user’s status on and access to their services and data. Making multiple sites and platforms simultaneously. these development tool kits publically available, Users can embed hyperlinks in their various and facilitating a developers’ community blogs and picture-sharing sites to provide has resulted in unparalleled development cross-platform interactivity. Successful social collaboration resulting in faster time-to-market networking sites not only allow users to post and a broader range of applications to meet messages or facilitate in-browser instant various consumers. messaging, they also allow users to share, tag and rate content. These functions increase the reach of the content and subsequently facilitate viral dissemination of content. Despite privacy concerns, in studies conducted by pricewaterhouseCoopers, internet users have demonstrated the willingness to trade personal information for features they find useful or informative. 2 KOOLTUO AIDEM BARAARAB MEDIA OUTLOOK 2008-2012 g ROf gnITAROBALLOCCOLLABORATIng fOR gROwTh 29