2. Disclaimer:
The information contained in this publication is of a general nature and is not
intended to address the circumstances of any particular individual or entity. The
document has been prepared with the help of various sources believed to be
reliable, but no representation or warranty is made to its accuracy, completeness
or correctness. Whilst due care has been taken in the preparation of this
publication and information contained herein, Mazars takes no ownership of or
endorses any findings or personal views expressed herein or accepts any liability
whatsoever, for any direct or consequential loss howsoever arising from any use
of this publication or its contents or otherwise arising in connection herewith.
3. Foreword 3
Executive summary 4
Emergence of the new economy and its challenges 6
Information dissemination: challenges in today’s world 8
Analogue to digital data: route to e-commerce 9
Industrial revolution in the new age of digitalisation 11
Industry focus 12
Media & entertainment 12
Retail 14
Publishing 15
Telecommunication 16
Healthcare 17
Digital social isolation 18
Challenges & future outlook of digitalisation 20
Contents
We are living in a dynamic world where
speed is of essence and transformation
is the key to success. From the flickering
monochromatic images that appeared
first on the television sets of 1930’s to
the 3D Hi Definition images in a modern
day ultrathin LED display televisions, the
world that we live in has seen changes
driven by innovation. The impact of digital
technologies is prevalent in every spectrum
of our lives and consequently the current
era is also termed as the “digital age”.
The process of digitalisation started
some five decades back with the advent
of computing technologies and digital
electronics. Today digitalisation can be seen
as a tool of transformation which extends
beyond our lifestyle to the way we transact,
interact and conduct business. Across all
sectors, be this communication, media,
healthcare, retail and manufacturing, we
are increasingly seeing the use of digital
technology. The landscape of this digital age
is increasingly being driven by innovations
in e-communications, e-commerce
and ever increasing deployment of the
internet to create economies based on
high technology, massive communication,
knowledge creation and innovation. It is
important to understand and appreciate the
factors that are ushering in such changes
and how these are impacting the modern
day business.
Mazars has in this whitepaper analysed
some pertinent issues which throw light on
how digitalisation has become a vehicle of
this new age of transformation.
I am confident that you will find this
whitepaper useful to your business. We
would be happy to discuss any specific area
that you would be particularly interested in,
in greater detail.
Miguel De-Fontenay
Global Consulting Leader
Mazars
FOREWORD
4. Executive summary
Digitalisation, as we call it today, is
sweeping across every aspect of our
daily lives in all possible ways. Right
from gathering the news we find in the
newspapers every morning to the billing
process at our neighbourhood grocery
shop, it is digital technology that is
making tasks faster and more accurate.
The economy today is no longer driven by
real currency transactions only, but also
by concepts of e-commerce and electronic
transactions that take place, across the
globe, within a matter of seconds.
This digital revolution is now increasingly
dependent on the generation and
transmission of information, while
capitalizing on advancements in computer
systems. The ease of information
transmission has allowed the growth of a
new world economy, which is characterised
by rapid global communication and social
networking through digital media. In
addition, goods & services have become
more technology focussed and knowledge
centric. The concept of knowledge
economies is becoming increasingly
pertinent in the present scenario as
nations build up special programmes
towards the improvement of their
knowledge pool.
However, there are challenges in growth
of these knowledge pools. Around 28%
of the world’s population uses internet or
internet based communication platforms
to interact with one another and this usage
has increased by almost five folds during
the past one decade. However, when
analysed with a focus on different regions
globally, it is apparent that this growth has
not been uniform. There remains a huge
disparity in the growth pattern between
high and low income regions. This gap
is further accentuated due to the vast
differences between regions in the context
of their ability to access modern digital
communication tools.
The increasing use of digital media
in business communication and data
dissemination has led to a rapid growth of
e-commerce and m-commerce across the
world. Dependence on internet has led to
businesses getting established over the
internet and leading to faster trade of wealth
and assets, in most cases by using secured
internet transaction systems. Business
transactions over social networking sites
have lead to the coining of a new term
called “social shopping”. The opening up of
the telecom market and the blossoming of
broadband have further paved the way for a
flourishing e-commerce sector.
This is not limited to marketing and
business transactions alone. Digitalisation
has brought a paradigm shift to the
traditional ways of manufacturing, handling,
storing and transporting things. Computer
aided designing and manufacturing
processes have revolutionised the
manufacturing industry and the deployment
of industrial robots (which are digitally
controlled) have become the order of the
day across industries.
4 | Digitalisation
5. The scope of digitalization is immense
and its role on the transformation of
our lives may span across innumerable
business sectors. As a part of this
thought leadership whitepaper, Mazars
has analyzed some key driving factors
responsible for the digital transformation
in the world that we live in today. This
publication also provides some interesting
perspectives on certain sensitive
and critical issues of this era such as
industrial revolution in the digital age,
data management and transmission,
growth of e-commerce and their role in
changing business environment. Certain
industries such as Media & Entertainment,
Healthcare, Publishing and Retail which
have implemented tools and techniques
of the digital era have gained maximum
benefit. This publication also contains
an analysis of some important aspects
relating to the extent such tools have
been adopted and the advantages as
well as flipside of the ever increasing
implementation of these technologies
in these sectors. In addition, we have
provided an assessment of how the ill
effects of overindulgence in digital or the
virtual world have lead to social isolation,
which is more often termed as “digital
isolation”. Social interactions become
limited under such circumstances and lead
to isolating people from the real world.
This situation leads to many other social
issues which are increasingly being openly
debated in various forums on negative
effects of digitalisation, especially in a
situation where an increasing number of
people are getting involved with social
networking sites to communicate and
make friends in the virtual world.
It is evident that the digital world is not
devoid of challenges posed by antisocial
elements and the forces which tend to
create disruption in the lives of the people.
From internet frauds to electronic virus
attacks in the communication networks,
the age of digitalisation poses a whole new
set of issues for the world to encounter and
overcome.
With intrusion of digital technology in
every possible arena of innovation, the
future seems ever changing with new
technologies evolving almost every day.
Indeed while technology has greatly
improved as time has passed; scientists
are continually working in order to develop
useful products, which facilitate our lives.
Even though some may well argue that
technology has lessened the quality of our
lives, others have a view that this may have
well made our lives easier. Digitalisation has
provided to us better knowledge with faster
ways of locomotion and communication.
After assessing various perspectives,
developments and outcomes, what appears
to be coming out very clearly is that it is a
balanced and effective use of digital tools
and techniques that can eventually make
our dreams of today, a reality of the future,
while making our world a better place to
live in.
Mazars Thought Leadership Series | 5
6. Emergence of the new economy
The industrial revolution that swept the
world decades ago had set forth a base
for an economy which was dependent
on manufacturing. However, by the end
of the 20th century, the world has seen
the rising of a new economy which has
transformed from heavy industry to new
knowledge driven technologies. The use
of knowledge in technologies such as
knowledge engineering and knowledge
management has led to an age of rapid
information dissemination and the process
of transformation has been accentuated by
digital technologies, developed across the
world.
The new information economy which is
largely dependent on digital technologies,
is linked to the concept of a digital age
or digital revolution and carries the
ramifications of a shift from traditional
industry to an economy based on
the generation and transmission of
information.
The information era is a phenomenon
where the current economy is dependent
principally on the ability of individuals to
transfer information freely and to have
instant access to knowledge that would
have previously been difficult or impossible
to find without digital technology. This
digital economy has been formed by
capitalizing on advancements in computer
systems, with the transition spanning the
introduction of home computer in the 1970s
to the 1990s when internet was accessible
to the general public and the adoption of
such technologies in the two decades after
1990. The information age has allowed
growth of the new world economy and as
such has been characterised by rapid global
communications and networking to shape
the modern society.
Although the new economy, which may also
be termed as digital economy and which is
marked by e-commerce and m-commerce,
has become a widely accepted phrase, it
is still not precisely defined. It is currently
identified by e-communication and internet
based businesses, which combine to form
its backbone.
Several important trends collectively
contributed to the rise of the new economy.
First, today’s goods and services have
become technologically sophisticated and
knowledge-intensive.
Second, for technological and competitive
reasons, knowledge is increasingly
becoming a distinctive factor in the new
economy. The knowledge-driven economy
is not only about new high-tech industries,
neither is it confined to a particular
technology but it is about those aspects
and sources which can potentially create a
competitive advantage; and with this the
ability to innovate, to create new products
and exploit new markets. As knowledge has
become the driving force for the economic
growth, organisations across the globe are
depending on the success of application
of human know-how in everything they
produce and the ways of producing it.
Products themselves are increasingly
characterised by knowledge content. Adding
ideas to the products and turning them into
new products is becoming crucial to wealth
creation. Digitalisation has helped in more
than one way and the rapid growth of trade
and commerce across the world is being
made possible by digital communication
and digitally controlled rapid transportation
systems.
Thirdly, the new economy is completely
consumer centric. Products are increasingly
being made to order and information is
personalized. A widely held hypothesis
is that the individualization is the key to
success – particularly as one goes from a
large to a small and to a smaller group and
finally to the individual level.
One unique way to depict how well
countries across the world fare in terms
of managing their knowledge economy is
through the global Knowledge Economic
Index (“KEI”). KEI itself was designed as
an interactive means for the benchmarking
a country’s position vis-a-vis others in
today’s global knowledge economy and
was created by the World Bank Institute.
This takes into account key variables in
four knowledge economy pillars - economic
incentive & institutional regime, education
& human resources, the innovation
system & information and communication
technology.
Knowledge is being put to work every day
to accelerate and deepen the development
“Knowledge
Economies Index
takes into account
key variables in
four knowledge
economy pillars
- economic
incentive &
institutional
regime, education
& human
resources, the
innovation system
& information and
communication
technology”
6 | Digitalisation
7. process. When applied to all types of
innovation, including the more modest
ones in the use of basic technology, it
becomes a major resource for wealth
generation and job creation. While various
types of knowledge, including the most
traditional can be of use; at the same
time there is a need to invest in advanced
technologies to stay competitive. In
these times of accelerated globalization,
“grey matter” or knowledge is a country’s
main durable resource. Its exploitation
for economic and social well-being is
increasingly at the center of development
strategies.
The central role of knowledge and
innovation in economic growth is widely
acknowledged in advanced countries
and the experience of those that have
championed this new paradigm has led to
the coining of the expression of Knowledge
Economies (“KE”). However, this notion
is less widely accepted among developing
countries, the elaboration of appropriate
and efficient policies for knowledge based
development processes is particularly
challenging in view of the more difficult
political and economic environment in
some countries.
One of the major challenges in the
information era that is backed by the digital
technology pose, is building of KE’s. This
is primarily intended for the policy-making
community of developing countries and
deals with advanced development strategies
that focus on policies to address intangibles
assets such as education, innovation,
information and communication
technology. With globalization and the
technological revolution of the last few
decades, knowledge has become the key
driver of competitiveness and is now
reshaping the patterns of the world’s
economic growth and activity. It is
therefore imperative for both developed
and developing countries to think, with
some urgency, about their future in terms
of becoming and sustaining themselves as
KE’s. To become successful KE’s, countries
have to rethink and act simultaneously
on their education base, their innovation
systems and their information and
communication technology infrastructure,
while also building a high-quality economic
and institutional regime.
The role of digitalisation in transforming
the countries into KE’s and sustaining them
over a period of time is vital. The thrust
to the pillars of KE’s can only be provided
if a country is able to internalise the
advancements in the digital world and put
them to optimal utilisation in the growth of
intellectual and knowledge dissemination.
The future global economy, is dependent on
smart business processes and tools and is
termed as digital economy.
Mazars Thought Leadership Series | 7
8. Information dissemination: challenges in today’s world
The internet is rapidly becoming a
mass medium for information and data
dissemination. Our research shows that an
estimated 1.96 billion people were online
globally in 2010 which is about 28% of the
global population. The growth of internet
users has been staggering at 445% in the
past 10 years. Within five years, internet
penetration has reached the level that
television took more than 15 years to achieve.
However this situation, if viewed in pockets is
different across the world.
The USA had initialy represented over half of
the global internet users, but by the year 2010,
internet penetration from Asian countries
had increased to 42%, whereas Europe’s
share had increased to 24%. At the same
time North America’s share has fallen to
13% from a shade under half of the internet
users 10 years back. There are disparities
within Europe, as some parts of Europe have
moved online faster than others. Northern
Europe has reached a greater penetration
rate than the South with the penetration in
Germany and the UK accounting for nearly
50% of European internet users. There is a
similar contrast on a vertical platform with
Western Europe being higher than the Central
and Eastern Europe (“CEE”). Altogether this
means that compared to the USA, the growth
potential in Europe is extremely high. The
situation in the rest of the world, especially
Asia has been very inspiring as it now
contributes more than 40% of the worldwide
internet usage. The ensuing chart gives a
snapshot of the internet usage pattern in
different regions.
It has been warned that if left purely to market
forces, the digital economy could foster a
two-tiered society, creating a big gap between
those who can communicate with the world
and those who cannot. For example, in
USA there is a direct relationship between
family income and access to computers and
internet. Although some observers argue that
this is temporary, our research shows that
this gap is widening rather than disappearing.
Globally, most children today are not growing
up digital. Among the billion people born in
the last decade, 97% were born in developing
countries often lacking food, housing, and
education. Interestingly, more than half of the
1.2 billion children in the world, aged six to
eleven, have never made a phone call.
However, the real gap comes between the
developed and the developing world. There
are still people in the latter who do not have
access to telephones. With the network
becoming the basis for commerce, wealth
creation, jobs, learning, health care, as well
as social development, these countries will
become severely disadvantaged. Being poor
involves being information-poor as well.
Even if there is access to internet, in many
regions of the world data transmission is slow
due to use of obsolete technologies with poor
connectivity. However with introduction of
broadband services worldwide, the scenario is
changing. Network Service Providers (“NSP”)
like Level3, UUNet, Sprint, AT&T, Savvis, Qwest,
Time Warner and NTT, play important role in
connecting the masses through the internet. It
was estimated that around 500 million internet
subscribers use broadband. As per the latest
available data, China Telecom led the pack of 10
largest broadband service providers followed by
China Unicom. The two Chinese ISPs account
for nearly 20% of the world’s broadband
subscribers.
Mobile networks are fast becoming the
mode of information dissemination with the
introduction of data services both in the 2G
and 3G spectrum. 3G spectrum is rolled out
in almost every corner of the world now, and
statistics show that most of the revenue for the
network operators come from data services
rather than voice services, which indicates that
more and more information sharing would
happen over this network as over the internet,
globally. This should help in bridging the gap
to a certain extent over a period of time.
“The growth of
internet users has
been at a staggering
445% in the past 10
years.”
Internet users in the world by regions 2010
Growth in mobile cellular subscribers
0
1
2
3
4
5 3G
2G
2006 2007 010280025002 2009
Billions
Source: ITU World Telecommunication/ICT Indicators database
8 | Digitalisation
9. Analogue to digital data: route to e-commerce
VCRs, tape players, and record players
are now the devices of the erstwhile era of
analogue recording, where data was linearly
recorded from one point to another. With
the introduction of digital technologies,
recording and storage of data took place
through the binary system using zeroes and
ones. This resulted in advent of terms like
“sampling rate” or “bit rate,” which refer to
the number of times per second the digital
signal is sampled, The higher the number,
the higher is the quality of sound or video.
Lets look at why such digital transformation
took place in the first place. Computers
perform digital computations, which can
only work with digital media. Consequently,
all analog audio or video media need
to be converted to digital to work on a
computer. Once the information is digital,
computers can be used to edit the data and
create effects that were never possible with
analogue media. Digital media is non-linear,
which means it can be edited or played back
by starting at any point, and is a timesaver
compared to working with tape. Digital
information also does not “wear out” after
repeated use like tapes or records do, which
results in much better longevity for digital
media.
Similarly, documents which were earlier
stored in printed form can be compared to
analogue data where such data is subject to
wear and tear over time. Earlier businesses
were conducted through traditional means
involving paperwork and manpower where
transactions took place through physical
“Social networks
like Facebook
and e-commerce
are beginning to
converge leading
to what has been
termed as Social
Shopping”
interactions between the seller and the
customer. 15 years back, websites like
E-bay and Amazon opened their shops
online, and ever since, this phenomena
has changed drastically with the buying
and selling process moving to a virtual
transaction world. This led to the terms
e-commerce and e-business. Subsequently,
with the advent of mobile telephony
services being integrated with data transfer
facilities, mobile-business or m-commerce
took shape. As per estimates, worldwide
over 85% of new handsets are currently
enabled to access the mobile internet
and marketing and advertising through
mobile has a market size of over USD 3.5
billion at present which is expected to grow
exponentially to about USD 38 billion by
2015.
E-commerce and m-commerce sectors are
now entering a new phase of development
as the traditional online commerce sector
merges with the newer web and mobile
tools of social media, cloud computing
and location based services. In addition,
infrastructure required to facilitate online
and mobile commerce is becoming a
reality as high-speed broadband and
mobile technologies become more closely
integrated.
The e-commerce model is now evolving
and combining new elements of online
experience. In addition, original e-retailers
are facing competition as services based
on Person-to-Person (“P2P”) model, which
refers to a service which allows users to
communicate directly with each other to
exchange information, products, services,
or make direct payments to each other,
have become increasingly popular. Crowd-
sourcing is an extension of the P2P model
and facilitates group communication
in niche areas. Also, social media such
as social networks like Facebook and
e-commerce are beginning to converge
leading to what has been termed as Social
Shopping. Successful online business
models are being quickly adapted or
incorporated into mobile devices in order
to maximise revenue opportunities. It
is now difficult to discuss e-commerce
developments in isolation of m-commerce,
as these two sectors have become so
closely inextricably intertwined. Google’s
gross revenue from mobile advertising is
over USD1 billion per year, suggesting that
mobile internet based business models
can be main revenue earners under present
scenario.
While the e-commerce sector has become
a competitive sector – other changes are
also occurring in terms of how merchants
operate and manage their websites. Some
e-retailers are outsourcing areas such as
security and payment processing, while
others are beginning to make use of cloud
computing. Cloud computing allows those
e-retailers who do not have resources or
capacity to manage their sites infrastructure
to tap into a cloud based service. Cloud
computing that offer software-as-a-service,
web-based access to storage and computing
power and give developers the tools to build
Mazars Thought Leadership Series | 9
10. yy Despite the economic downturn, online spending was resilient in most markets and in the current year we have seen the
return of some growth, as tentative confidence in the world economy returns.
yy Australia , Hong Kong, India, Japan, Singapore and South Korea are some countries in Asia Pacific which have embraced
online spending and there is room for substantial growth ahead in there country. It has also become recognised that China too
offers enormous potential in the future.
yy Although the internet’s overall share of total USA retail sales remains relatively small (at less than 4% in the current year), the
same has increased from around 1.5% in 2003. However, this share is expected to continue to grow steadily over the next 5 to
10 years, with exports forecasting sales of over USD 240 billion by 2014.
yy Western Europe is one of the key regions where global e-commerce has grown. E-commerce usage in Eastern Europe is also
growing strongly on the back of growing broadband penetration and internet usage.
yy The opening of the telecom market and the blossoming of broadband has paved the way for a flourishing e-commerce sector
in countries like Argentina as well.
yy Mobile commerce is potentially important for a wide range of industries, including telecommunications, IT, finance, retail and
the media, as well as for end-users. This will work best in those areas where it can emphasise on the core virtue of mobile
networks – convenience.
yy While Dubai and Jordan have developed as the Middle East region’s major bases for web-based businesses and services, Saudi
Arabia, which is home to around one in seven Arab internet users, is this region’s most important market.
yy In the United Arab Emirates, in 2010 Etisalat announced a partnership with Mobiqa which allows consumers to purchase
tickets via their mobile (m-ticketing).
yy M-payment services carry more than 12% of the country’s GDP in Kenya.
Source: Research and Markets 2010
Some facts about different countries in terms of e-commerce
and host web applications is one of the
most promising area of IT. Organisations
like Amazon, AT&T, Enomaly, Google,
GoGrid, Microsoft, Netsuite, Rackspace
etc. have been rigorously dwelling into the
possibilities of cloud computing and have
been successful in turning their business
goals into reality.
E-commerce and m-commerce services
have become so dynamic that keeping
abreast of the emerging trends has become
a key priority for many enterprises and
investors alike. Our experts believe that the
future directions of the e-commerce and
m-commerce are likely to be focused on the
use of social media, location based services
and cloud computing for the digital economy.
10 | Digitalisation
11. Industrial revolution in the new age of digitalisation
The industrial revolution that swept
the world in the 19th century, has been
further accentuated by the digital era, with
the application of digital technologies
in modern day manufacturing industry.
Digitalisation of manufacturing
techniques has changed the way products
are conceptualised, designed and
manufactured. The shape of engineering
drawing boards have changed from pen
and pencil drawings on white paper
sheets to computer simulated 3D models.
This change has been brought about
by development of Computer Aided
Designing (“CAD”) and Computer Aided
Manufacturing (“CAM”) technologies over
the past three decades. From 2D CAD,
technology has moved on to 3D CAD
and direct digital manufacturing or rapid
manufacturing. While CAM has been in the
market since its inception in early 1970’s,
integration of CAD with other components
of CAD/CAM Product lifecycle management
(“PLM”) environment that required an
effective CAD data exchange have helped
the manufacturing industry grow rapidly.
The age of digitalisation enhanced these
technologies to direct digital manufacturing
or rapid manufacturing which is a process
of creating physical parts directly from
3D CAD files or data using computer-
controlled additive and subtractive
fabrication and machining techniques.
“Digital computing
has ushered in
an era of rapid
manufacturing and
robotics which in
turn are assisting
the manufacturing
sector to undergo
yet another
industrial
revolution”
Advanced CNC machines, which are
based on microprocessors and advanced
software applications, have helped the
manufacturing industry attain higher
productivity.
The increasing usage of robots in the
manufacturing process has led to
minimisation of human intervention
and maximisation of quality assurance
in the manufacturing process as well as
the products. The first modern industrial
robot, called “Unimates”, was developed
by George Devol and Joe Engelberger in the
late 50’s.
The robots of today are based entirely on
computer technology. Usage of robotics
in manufacturing has been possible
due to advancements in digitalisation
techniques. The development of computing
and software that run the computers aide
robotics usage in factories. Software based
control panels, computer interface for
control and monitoring and mechanical
robot hardware form the backbone of digital
manufacturing in factories worldwide. Our
research shows that 90% of all robots
used today are found in factories. Although
robots help in almost every possible sector
such as aerospace, chemical, rubber
and plastics manufacturing, electrical &
electronics entertainment, food & beverage
manufacturing, mineral production,
printing; automotive manufacturing and
supply are by far the largest users of robots
in their factories. In the turn of the century,
as many as 90% of the robots used in
manufacturing were used in an automotive
industry. Our research also shows that
though this share has now come down to
about 50%, automobile is still the largest
industry sector to use robots.
Digital computing has ushered in an era of
rapid manufacturing and robotics which in
turn are assisting the manufacturing sector
undergo yet another industrial revolution,
but this time towards a high degree of
sophistication leading to increased level
of automation and quality control in
production.
Mazars Thought Leadership Series | 11
12. Industry focus
Although, digitalisation has changed facets
of almost every aspect of our lives, be it
communication, fashion, media, food
processing, buying and selling of products
etc., in this section we focus on some specific
Over the years, digital technologies have
progressively increased their impact across
all segments of media and entertainment
(“M&E”) where digital transformation
continues to expand and escalate. In the
advent of the 20th century, three very evident
technologies had an impact on the M&E
industry - radio in 1920’s, television in 1940’s
and cable TV in 1960’s. Later, introduction
of VCRs, video games, wireless devices,
the personal computer, the internet and
DVD players accelerated the speed of the
technological change. Since the beginning of
21st century, the world has seen a complete
gamut of technological change from MP3
players, broadband, video on demand
(“VOD”), satellite radio, social networking,
digital media adapters, high definition TV, Blu-
Ray and online gaming.
A new dimension was added to media
technologies with cellular phones, personal
computers and the internet which were
introduced in 1980s. Once niche market
products for advanced technological wizards,
they are now seen, in developed markets, as
industry segments which have been most
positively impacted by this transformation.
The business models of these industry sectors
have seen drastic changes over the last two
decades as digitalisation has picked up rapid
must haves that even the most technophobic
consumer cannot live without. Cellular
phones have been replaced by smart phones
and desktop computers by laptops and
newly introduces tablet computers and the
internet has transformed from a medium
of communication to a global information
and entertainment network, transmitting
information on any topic in any category to
anywhere in the world. Broadband and mobile
networks are proving to have the strength
and capacity to enable the rapid growth of
application development through the process
of convergence.
We now have tools at our disposal which
are revolutionising our social and economic
environment. Mobile and online social
media sites like Orkut, Facebook, Twitter,
MySpace etc. are good examples of how
the new tools have been used to the level
of personal interaction and show the
potential that the internet, mobile, email
and broadband infrastructure have to offer.
The satellite television through the Direct to
Home (“DTH”) format has become most
momentum. Modern technologies have
been put to apt usage by these segments to
maximise profitability and optimally manage
their manpower, supply chain, operation and
business strategies.
popular with more and more people turning
to it due to digitally enhanced pictures and
better sound quality and Value Added Services
(“VAS”) such as integrated internet access,
VOD, additional radio channels etc.
The internet has become a great source of
entertainment with many different services
available. As well as social networks, some
of the most popular online entertainment
services include gambling, gaming, online
dating, online music and online video.
Experts believe that in the next few years the
overall global entertainment and publishing
industry (online and offline) is expected to
be worth a couple of trillion dollars. Online
video in particular is becoming recognised
as a powerful format for entertainment and
communication while providing an enhanced
online experience. Google’s YouTube
continues to dominate currently in terms
of the number of viewers and broadcasts
streamed. New business models are also
emerging that explore alternate ways of
generating revenue from such sites. Leading
internet media companies also continue
Media and Entertainment
“Digital technology
has been aptly
deployed by some
industry segments
to maximise
profitability and
optimally manage
their manpower,
supply chain,
operation and
business strategies”
12 | Digitalisation
13. to look for opportunities presented by
mobility, cloud computing, home media,
infrastructure etc. In all this emerging
markets have also not escaped attention;
China in particular is seen as a significant
growth opportunity.
Google remains the most popular web
property worldwide. One of the other
areas where the digital media has seen a
sea change within last two decades is in
the special effects, with these in movies
are increasingly getting sophisticated.
The growth of companies like Lucas
Film’s Industrial Light and Magic Pixar,
Silicon Graphics and others, means that
entertainment is increasingly blurring the
line between creativity and engineering.
Popular Hollywood movies like Avatar, Toy
Story, Day After Tomorrow, 2012, Matrix,
Harry Potter and the Lord of the Rings are
some astounding feats of special effects
being used in entertainment business
through computer-generated imagery
(“CGI”) techniques. Some companies
which have pioneered this industry are
Pixar, Lucas Film and Blue Skye.
Our research shows that the M&E spending
of 12 leading countries was above USD 20
billion last year, led by the USA at USD 428
billion and Japan at USD 164 billion. Of the
leading countries, China is projected to be
the fastest growing with a 12% compound
annual growth rate (“CAGR”), fuelled by
a vibrant economy and large increases in
broadband penetration which in turn are
expected to propel other segments. Japan
is expected be the slowest growing of the
leading countries at 2.8% CAGR.
Internet access is a key driver of spending in
most segments. Experts are of the view that
increased broadband penetration will boost
wired access while growing smartphone
penetration and wireless network upgrades
will drive mobile access. Experts also
believe that spending on wired and mobile
Internet access will rise from USD 228
billion in 2009 to USD 351 billion in 2014.
Our research shows that global advertising
is set to increase at a 4.2% CAGR from
USD 406 billion in 2009 to USD 498
billion in 2014. At the same year the overall
consumer/end-user spending is expected to
rise from USD 688 billion in 2009 to USD
842 billion in 201t a 4.1% CAGR.
According to experts, the global video
game market is projected to grow from
USD 52.5 billion in 2009 to USD 86.8
billion in 2014, growing at a CAGR of
10.6%. This will make it the second fastest-
growing segment of M&E behind internet
advertising wired and mobile. However this
will be the fastest-growing consumer/end
user segment ahead of TV subscriptions
and license fees.
The global television subscription and
license fee market is set to increase from
USD185.9 billion in 2009 to USD 258.1
billion in 2014, at a CAGR of 6.8%. Our
research shows that this will outpace TV
advertising, which will grow at a CAGR of
5.7%. Asia Pacific will be the fastest-growing
region with a 10% CAGR and is expected
to rise to USD 47.1 billion in 2014 from the
current USD 30 billion.
The total global spending on consumer
magazines fell by 10.6% in 2009 and is
projected to follow a similar pattern till 2012
but with a less steep negative growth rate
and modest growth during 2012–14. As a
result, spending on magazines will total
USD 74 billion in 2014, with 0.7 % CAGR
from USD 71 billion in 2009.
Experts believe that electronic educational
books will grow at a CAGR of 36% globally
but would still only account for less than
6% of global spending on educational
books in 2014.
Global M
&E Outlook
Mazars Thought Leadership Series | 13
14. Retail
Digitalisation provided a new dimension
to the operational setup of the retailing
industry as a whole. The introduction
of point of sale equipment, bar codes
and billing and payment databases have
facilitated efficient management of large
retail organisations. With the deployment
of digitalisation, retail operations can be
recorded in a structured and systematic
manner, providing detailed analysis of
the sales and volume of transactions.
Electronic transactions have increased
with the volume of sales. Flexibility in the
payment terms ranging from interest free
easy EMI’s to cashless transactions have
helped in driving the sales northward.
While the introduction of a new technology
may be intricate for some retailers, its
convenience and cost effectiveness creates
the need for transformation. Large stores
need to monitor inventories and expenses
of establishments virtually on an online
basis. With automated machines and
high-end computers making the task
simpler, the focus of retailer is on retaining
customers with new strategies. Add to
this, digital security systems offer safer
shopping experience for retailers as well
as customers, providing immense mental
relief to all the stakeholders. Point of
sale (“PoS”) applications provide quicker
consumer check-out and multiple payment
options like credit cards.
Retailers can now enhance the experience
their customers receive with store and
loyalty cards which can facilitate tracking,
spending habits and buying trends. By
knowing who, what, when and how people
buy certain products, retailers have been
developing individual campaigns, staff and
stock levels effectively.
Another new road in the technology to
improve their overall operations, safety
and communication is through the use
of radios. For all retailers, two way radios
are the perfect way to improve their
communication and performance. Not only
do two way radios allow members of staff to
communicate over a wide area but they can
be used as a health and safety tool by which
workers can report accidents, check stock
levels and stay in touch across the entire
site from the shop floor to the distribution
area. For example if a customer asks a
member of staff if a particular item was in
stock, within seconds sales person may
revert to the customer.
The emphasis of retailers is in utilizing
IT solutions like Customer Relationship
Management (“CRM”), Online Analytical
Processing (“OLAP”), Collaborative
Planning, Forecasting and Replenishment
(“CPFR”) tools to conduct behavioural
analysis. Retail ERP packages have been
implemented by large retailers but one
of the biggest hurdles in utilizing these
optimally is the inadequate training to
the end users. However, it is expected
that the demand and utilization of these
packages will grow in the near future. It
is estimated that about 400 to 500 MB
of data are transmitted daily between
point-of sales counters and corporate
headquarters of retail chains in developed
countries. Relay of transaction data in such
volumes helps maintain a close working
relationship between retailers and vendors
to predict consumer demand, shorten
lead times, reduce inventory holding and
thereby save cost. Retailing database also
helps in tracking purchase behaviour
through demographic and psychographic
information. This clearly is an indication of
digital technology serving as an effective
means to build the retail business and not
just restricted to supporting and improving
the operational efficiency. Use of electronic
communication like e-marketing is a cost-
effective form of attracting and retaining
customers. With internet penetration
and awareness on the rise in the
country, e-marketing proves to be a good
communication tool. Use of technology is
being further extended to home shopping,
direct mails and telemarketing while
facilitating growth in newer applications like
kiosks, intelligent vending machines, PC net
shops, etc
Banking business of international banks
such as Citibank, HSBC, Standard
Chartered etc. is growing rapidly due to
increasing use of e-cash gateways with
the growth of online retailing. Services
like PayPal are becoming highly popular
amongst millions of consumers around the
world for transacting on online shopping
portals.
It is widely felt that the key differentiator
between the successful and not so
successful retailers is primarily in the area
of technology. Consequently, it is technology
that will help the organised retailer score
over the unorganised players, giving both
cost and service advantages. Successful
retailers today work closely with their
vendors to predict consumer demand,
shorten lead times, reduce inventory
holding and thereby, save cost. Wal-Mart
pioneered the concept of building a
competitive advantage through distribution
and information systems in the retailing
industry. They introduced two innovative
logistics techniques - cross-docking and
electronic data interchange. Today, online
systems link point-of-sales terminals to
the main office where detailed analyses
on sales by item and classification are
conducted for the vendors. Besides
vendors, the focus of the retailing sector
is to develop the link with the consumer.
`Data Warehousing’ is an established
concept in the advanced nations. With the
help of `database retailing’, information on
existing and potential customers is tracked.
This facililates the flow of information on
what was purchased and by whom, and also
on softer issues such as demographics and
psychographics.
14 | Digitalisation
15. Publishing
From the prehistoric period, words have
been incised in clay, inked with a quill and
later with inventions, printed on presses
or transmitted as electronic bits in email.
This is moving to dedicated eReaders,
multipurpose tablets and other digital
devices that according to experts could
be in the hands of 15% to 20% of the
developed world’s population in the next 5
years. This new format is expected to trigger
a profound change in the publishing world
and start new trends in content creation.
Several factors suggest a fairly smooth
evolution toward the digital age, including
most readers’ continuing attachment to
paper, the complementary nature of eBooks
and paper and relatively limited electronic
piracy. Nevertheless, with 15% to 25% of
book sales shifting to digital format by 2015,
the publishing industry is heading into
wholly new territory. The penetration rate
could reach higher levels if multipurpose
tablets continue to penetrate into the
gizmo market across the world in their
current upward trajectory movements. As
USA, Korea and China are setting the pace
in this context and could see very high
penetration rates by 2015 whereas other
countries, particularly those in Europe,
will eventually catch up. Over the past 20
years, digitisation of content has shaken
the economic foundations of industries like
the press, music and video. The absence
of convenient e-reading platforms had
protected books from such a revolution
till now. However, the emergence of new
mass-market devices, such as dedicated
eBook readers or multipurpose tablets, has
put an end to that reprieve. However long
it takes, conditions are perfectly aligned for
readers to embrace digital devices. Prices
have sunk below consumers’ purchasing
thresholds, with some e-Readers already
less than USD 125. At the same time, the
reading experience and ergonomic designs
are improving.
Given the pace of transformation, authors,
publishers, distributors and retailers may well
need to rethink their business models and
their relationships with one another. They will
have to address several critical challenges:
pricing policies that secure the industry’s
changing profit pools, redefined distribution
networks that preserve format diversity and
the reallocation of value among industry
participants. Blending editorial with retail
has become advantageous from economic
and consumer standpoint with publishing
houses entering into a series of e-commerce
partnerships in the course of this year. Large
publishers like Hearst Magazines which
publishes biggest selling magazines such
as Cosmopolitan and Esquire and Conde
Nast publication which publishes Vogue
are teaming up with online merchandising
agencies to boost up revenue through selling
products featured in their magazines. Also,
online publishing services are fast catching
up with publishers like iUniverse, Author
House, Infinity Publishing, Bookstand
publishing, promoting and selling books
through the internet. Unlike portals such as
Amazon, these are not only sites which sell
the books but publish and market them too.
Experts believe that the emerging scenario
would see a shifting balance between
eReaders, such as Amazon’s Kindle and
multipurpose tablets such as Apple’s iPad.
Previously, eReaders could capture as much
as a third of the market, based on a price
advantage and a reading experience that
closely matches that of paper. Multipurpose
tablets, priced above most consumers’ USD
300 psychological threshold, are still too
expensive for mass-market adoption. Yet over
time, they could predominate by capitalising
on multimedia capabilities that appeal to
a broader audience even as their prices
inevitably decline. Indeed, access to other
media and valuable functions may open the
gates on eBook penetration rates.
Emerging consumer behaviours will affect
literary genres differentially in terms of their
acceptability in digital format. In other words,
distinct adoption rates and business models
will impact fiction and nonfiction works,
guide books, illustrated books and children’s
literature or information. Reference books,
such as encyclopaedias and maps, have
already migrated to digital formats. Almost
all are now available free on the internet,
which has dramatically depressed print sales.
Today, the static nature of first-generation
electronic formats has made both publishers
and consumers focus first on fiction and
nonfiction and in coming next 5 years, such
works will likely remain the genre which is
most widely read on digital formats. Digital
offerings for other genres, such as lifestyle
guides, illustrated books and children’s
books, remain relatively limited today. But
their production could accelerate to meet the
strong consumer expectations. Competition
from today’s magazine and internet
companies could limit this potential, but a
strong new demand is there to be met.
Powerful digital distribution platforms
have already emerged, with select players
predominating this space: Amazon, benefiting
from its first-mover advantage, Apple, riding
on the success of iTunes, and possibly Google
in the near future. These platforms use data-
mining algorithms to extract a new kind of
consumer insight. In essence, they seek to
step into the advisory role of the individual
bookstore owner. More than that, virtual
distributors could upend today’s book-selling
hierarchy, altering everything from its vast
physical distribution networks to authors.
These could even contribute to the emergence
of truly global book publishing markets.
Writers, in particular, may be able to carve
out a new and direct role in consumer
relationships. Social networking sites such
a Twitter are being increasingly used by the
authors to popularise their books and create
a one-to-one relationship with the readers
which was an elusive situation earlier. The
anticipation for a particular book goes
up amongst the readers once a personal
bonding with the author is achieved over
such social networking sites. Hence, the role
of author in the modern publishing world
becomes more vital. Authors are in an ideal
position to benefit from the digital era.
Best-selling authors in particular should
gain more bargaining power with publishers
and distributors, which could increase
their share of the profit pool. A number
of authors have already unbundled the
physical and digital rights of their works to
increase their negotiation power.
The advent of digital publishing raises
some fundamental questions as to how and
who shall preserve tomorrow’s electronic
content? What is to be preserved and which
are to be left out? Who will decide on it and
under which criteria? Countless libraries,
national or private, have already begun
digitising paper-based content to secure its
preservation. This is a colossal task requiring
equally large investments. The digitalisation
of content and its preservation is a big
business opportunity for many organisations
across the world. The digitalisation of
publishing has opened doors to many
opportunities not only to the people directly
related to this industry but also to others
who tend to support this industry through
digital technology innovations.
Mazars Thought Leadership Series | 15
16. an approach known as forbearance where
incumbents have no obligation to offer
access to other operators once they have
upgraded to NGN. The European Union
(“EU”) is opposed to this approach and
has opted for charging risk premiums for
NGA access. Japan is the global leader in
deploying NGN broadband networks, but
for successful implementation of NGN,
there has to substantial investments in
the fiber cable networks across the world.
Demographics, topography, regulatory and
political scenario along with consumer
demand are key factors that are driving
investments in fiber cable networks that
enable NGN.
Digital infrastructure is the backbone of
telecommunication and according to the
reports of financial analysts, in USA alone,
the overall capital investments by telecom
carriers, cable TV companies, and broadband
wireless providers was USD 51bn in 2009 out
of which almost 60% went to further boosting
and setting up infrastructure for broadband
services. Digital switches have become
indispensable part of active infrastructure in
telecom sector. The BRIC markets comprising
Brazil, Russia, India and China are expected
to see the spending on telecommunications
grow to nearly USD 1 trillion collectively
over the next few years. It is estimated that
by the end of 2010, there were 5.3 billion
mobile cellular subscriptions worldwide,
including 940 million subscriptions to 3G
services. Access to mobile networks is now
available to 90% of the world population and
80% of the population living in rural areas.
With 143 countries now offering 3G services
commercially, people are migrating rapidly
from 2G to 3G platforms, in both developed
and developing countries. In a stage where
3G has become affordable to the masses a
number of countries like Sweden, Norway,
Ukraine and USA have started to offer 4G
wireless platforms which provide even higher
broadband speeds.
The emergence and continuing
commercialization of Voice over Internet
Protocol “(VoIP)” is another area that
impacts the telecommunications industry
where voice communications are done
over IP networks such as the internet or
other packet‐switched networks. Some of
the future technologies that the industry
is contemplating are IP multimedia
subsystems (“IPMS”), mobile TV, mobile
virtual network operator, IP version 6, and
the fourth generation cellular network.
0
50
100
150
CIS Europe The
Americas
Arab
States
Asia & Africa
0
5
10
15
20
252009/2010
growth rate (%)
Subscriptions
Region-wise mobile phone
subscriptions per 100 Inhabitants, 2010
Developed
World
Developing
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
0
5
10
15
20
25
Deve o
or
Deve opin
Growth of broadband subscriptions per
100 inhabitants in last one decade
Source: ITU World Telecommunication/ICT Indicators database
Telecommunication
Telecommunications is a captivating,
fast paced and one of the world’s largest
industry sectors that influences every aspect
of our daily life like normal voice phone
calls, connectivity to the internet, satellite
communications, surfing the web, fax
transmissions, video conferencing, high
speed data communications and cable TV.
It started with first public demonstration
of Morse’s electric telegraph, Baltimore
to Washington in 1844. In 1876 Alexander
Graham Bell created history by exchanging
world’s first two way long distance telephone
conversation between Cambridgeport
and Boston, Massachusetts. Times have
changed since then in a dramatic manner
with the emergence of digitalisation in the
field of communication. Telecommunication
today is one of the most exciting
occupational fields that modern society has
to offer. New techniques through innovation
in digital data transfer technologies are
constantly being developed which find
applications in the technical systems that
make up a telecommunications network.
In the current day scenario, there are a
lot of wireless digital communication
technologies that have evolved and are
used by people all over the world. Wireless
technologies like GSM, CDMA, time division
multiple access (“TDMA”), universal mobile
telecommunication systems (“UMTS”),
GPRS and latest 3G cellular wireless network
are growing at a fast pace promising high
speed data communications.
There is a huge growth in the mobile phone
subscriber base in the last five years. The
ensuing graphs show the region-wise
divide in the cellular subscription and the
tracks the growth of broadband internet
subscription per 100 persons in last one
decade.
The latest and most talked
about development in the digital
telecommunication space is next
generation network (“NGN”) which
denotes some key architectural evolutions
in telecommunication core and access
networks that are being deployed worldwide.
NGN is a network system that transports all
information and services (voice, information
& media) by encapsulating these into data
packets, similar to internet technology.
NGNs are commonly built around the
Internet Protocol (“IP”).
The transition to NGN requires a
substantial amount of capital expenditure
which has raised questions about access
rights to these networks. The USA is taking
16 | Digitalisation
17. records (“EHR”) are likely to be turned into
searchable medical databases, providing a
“smart grid” for medicine that will not only
improve clinical practice but also help to
revive drugs research. In the digital world,
wireless computers pull together all of the
digitized pieces of patient information - vital
signs, physicians’ notations, lab and test
results, prescription histories, X-rays and
package them as repositories for real-time,
enterprise wide electronic data delivery. That
essential reform will enable many other big
technological changes to be introduced. For
example, clinical trials are an integral part
of the healthcare system. However, they are
highly expensive and take a long time. It is
currently possible to replicate some clinical
trial results without the time and expense,
using access to EHR. Scientists have been
able to do this by analysing the data of
several thousand people.
Just as important, it can make that
information available to the patients too,
empowering them to play a bigger part
in managing their own health affairs.
Digital technologies such as wide area
outdoor wireless (“WiMAX”), VoIP, radio
frequency identification (“RFID”), among
other technologies allow information to
be disseminated quickly and easily at the
critical point of care. The EHR is currently
directly available to patients also for the
purpose of self-care.
Recent advances in digital technologies are
enabling providers improve the quality of
patient care. Today’s healthcare IT is much
more than traditional isolated computers
Healthcare
Despite its history of innovation, the
health-care sector was surprisingly reluctant
to embrace the information technology
revolution of 1990’s. However, healthcare
and medicine is now catching up in the
digitalisation drive. Devices and diagnostics
are also going digital, advancing such
long-heralded ideas as telemedicine and
personal medical devices for the home and
smart pills.
The first technological revolution in modern
biology started when James Watson and
Francis Crick described the structure of
DNA half a century ago. That established
the fields of molecular and cell biology and
the basis of the biotechnology industry. The
sequencing of the human genome nearly
a decade ago set off a second revolution
which has started to illuminate the origins
of diseases. A third phase of revolution is
shaping up with convergence of biology
and engineering. Experts believe tools
such as information technology, advanced
materials, imaging, nanotechnology and
sophisticated modelling and simulation are
likely be brought to application in biology
too.
Digitalisation promises to connect
doctors not only to everything they need
to know about their patients but also to
other doctors who have treated similar
disorders. The convergence of biology
and engineering will be led by information
technologies, which in medicine means the
digitalisation of medical records and the
establishment of an intelligent network for
sharing those records. Electronic health
and unfriendly applications. Increasingly,
patient care is exploiting the new tools and
information that systems can provide, while
maintaining a patient-centric approach to
their use.
Digital recordkeeping is only one
component that is changing the health care
landscape. Robots, equipped with a video
screen and two-way video capability, allow a
physician to control it remotely to conduct
patient visits and video conferences, check
on patient recovery and make decisions
under emergency conditions.
Digitalisation is also changing the
pharmaceutical industry. Electronic
prescription drug systems enable
physicians to write prescriptions directly
to a pharmacy. Automated machines can
dispense medications and supplies at
the nursing station or from the hospital
pharmacy directly to the nursing cart. These
machines also record and generate bills
and maintain inventory records and restock
medications.
The digital handheld blood monitor such
as Accu-Check is another invention that
has helped diabetic patients world over.
Sophisticated medical technologies save
thousands of lives every year, through
advanced scanning systems and devices
that keep people’s hearts beating and
blood flowing. In the last century, medical
technologies ably did their part to extend
the life expectancy. However, unlike other
sectors where use of technology is bringing
costs down, the opposite is happening to
healthcare segment. Although the same
digital technology is used for healthcare
as in some other sectors, the price of the
technology is not coming down as expected.
Two basic reasons are attributed to this fact.
First, the lack of price transparency in the
medical technology market as it is not an
open marketplace of prices and services.
Secondly, it is difficult for hospitals and
clinics to know whether there’s a better
deal elsewhere and manufacturers can
keep costs high. Thirdly, and perhaps more
significantly, medical technologies still
tend to rely on an expert class to actually
deploy the technology. Highly trained and
expensive experts are still needed to actually
put the technology to work, making it
impossible to entirely automate a process.
The result is that technology stays expensive
to use, and costs keep going up.
Mazars Thought Leadership Series | 17
18. Digital social isolation
Social networking websites provide tools
by which people can communicate, share
information, and create new relationships.
With the popularity of social networking
websites is on the rise, our social
interaction is effected in multiple ways as
we adapt to our increasingly technological
world. People now socialize through
the internet and it takes away from the
in-person socialization that has been
predominant till now. Social networking
websites effect our social interaction by
changing the way we interact face-to-
face, how we receive information, and
the dynamics of our social groups and
friendships.
Communicating through the internet and
social networking websites is a different
experience than communicating in person.
Chatting online is quick and easy and
permit connecting to an almost unlimited
number of people from all over the globe.
At the same time it changes the traditional
in person conversation that is important to
our social lives and friendships. This can
neither be attributed to have a positive or
negative impact on our social behaviors and
interaction unless and as long as people
know to strike a healthy balance between
internet interaction and face to face
interactions.
Digital media has penetrated into
our culture, invaded our values, and
overwhelmed us with information. The
digitalisation of lifestyle seems complete
at this moment with rapid transportation
using computer controlled public transport
“People now
socialize through
the internet and it
takes them away
from personal
socialization that
has been around
forever”
systems, latest interactive and intelligent
gadgets etc. but it is important to consider
social losses alongside the convenience
18 | Digitalisation
19. of this digital living. Recent advances in
information and media technologies have
dramatically altered the ways in which
we interrelate to the outside world. For
example, instead of playing an actual match
on a sport field, a virtual match against the
play station is preferred.
Despite or perhaps due to the
advancements in information technology,
quality of life in technology and media-
rich societies has suffered at the same
time. Issues such as the media’s impact
on mental health, the effect of video
games and digital entertainment on
child development, the use of media
in education, and technology addiction
have become increasingly important.
The idea that technology is responsible
for the widespread social isolation of our
time has got stronger and stronger in the
last century, walking at the same pace of
technological advance. Besides folk wisdom
and literary fascinations, recent empirical
studies suggest that communication
technologies like TV, cell phones and
internet may interfere with face-to-face
interactions. In today’s digital world, people
can get entertainment and information
while remaining entirely alone.
Digital gadgets like iPods immerses the
listener in a private world, cut away from
the community-building nature of popular
music that has been a characteristic
through much of its history. While the
Walkman triggered a similar isolation, the
shift from analogue cassettes – of a finite
length – to the endless permutations of the
party shuffle has meant that the digitised
soundtrack can be a perpetual companion
through life without changing the sides of
a tape or inserting a new disc.
According to experts, an average, internet
user spends three hours online every
day. More than half of the time is spent
communicating, 8.7% playing games,
6.5% surfing and 4.3% shopping. The
web is but the latest in a long list of
technological developments that have
improved the quality of life but restricted
social interactions.
It can be argued the world is more
connected than ever before, but people
spend less time in person with those
they care about. With regards to social
interactions, quantity has replaced quality.
Video games as well as at-home games
have been a part of social life for decades.
Evolution of gaming over time from board
games to video games has led to digital
isolation. 80% of the teenagers go online
and 43% spend over an hour a day on the
internet. A study also found that people
who use social networks like Facebook or
Linkedin are 30% less likely to know their
neighbours and 26% less likely to provide
them companionship.
People’s personalities begin to extend,
grow, and pervert themselves when they
reach the digital world, bringing out
otherwise uncharacteristic attributes in
the users who interact with them, whether
those users are trying to defend a point of
view or refute one. This is not the type of
behavior the social network was planned to
instigate; since these bodies of information
and communication were created to bring
people closer together. It is a loss of social
values, a change in standards and changes
in etiquette that further alienate people into
digital isolation.
Mazars Thought Leadership Series | 19
20. Challenges & future outlook of digitalisation
Once a fiction, now a reality. This has
been the story of digital technology with
its limitless possibilities to transform the
weirdest of imagination of yesteryears into
a modern day marvel. The business of
digitalisation began with the invention of
the first microprocessor and development
of computing technology based on
binary digits in the late 1950’s. There are
conflicting views as to what all can be
termed as the biggest inventions of the
digital era. The following list brings out
some of the most effective inventions which
formed the basis of further inventions and
modern day digital technologies.
yy Transistor
yy Microprocessor
yy Desktop computer
yy Gaming consoles
yy Modem and internet
yy Digital printing technology
yy Digital camera
yy Digital audio tracking systems
yy Mobile telephony
yy Laptop and miniature computers
Considering the above, three inventions
namely personal computer, cellular wireless
communication and the internet have
really radically transformed the future of
digital technology. However, the explosive
growth in digital technology over the last
few decades has raised several challenges
as well. It has been discussed in many
“Three inventions
namely personal
computer,
cellular wireless
communication
and the internet
have really radically
transformed the
future of digital
technology”
forums across the world that the privacy
is being compromised in the digital age
with almost every information being easily
transmitted within a matter of seconds.
With the sudden increase of information
exchange, authenticity of such information
is another critical issue being faced by the
world today. Another major challenge in
the digital world relates to possibilities
of networks getting corrupted. Although,
digital technologies are becoming more
and more secure, networks, both cellular
wireless communication and the internet,
are becoming vulnerable to attacks
from antisocial elements. The ability to
accommodate the vast and increasing
demand for information storage space on
the internet is cited as another challenge
that has to be overcome.
Digitalisation has changed many industries
and business strategies of organisations,
to cater to digital media and the customer
base that who is becoming more and more
accustomed to digital lifestyle. One of the
business segments where digitalisation
has made a huge impact is the M&E
world. This industry is set to grow at a
more than 6% globally in the coming years
and most of the growth is expected to
come from interactive digitalisation. With
opportunities of growth of about 15% in the
BRIC countries, the world’s largest digital
media companies are turning their focus to
these countries. This is just one of the many
examples where digitalisation is changing
the face of a USD 1,400 billion industry.
Special effects, particularly in animation,
movies, pyrotechnics etc. are some fields
within the entertainment business that have
changed with the advent of digital tools and
techniques. With broadband internet, IPTV,
networked gaming system, VoD etc. being
used by of common people, the potential of
digital media is virtually limitless.
Manufacturing, aerospace and product
designing are some fields where almost
all processes are carried out using digital
technology. From ideas which are currently
under research and development such as
keeping backup of data from a human brain
in digital media to connecting the internet
directly with human neurons, scientists are
pushing the digital technology to its limits.
However, self driven cars, automated public
transport systems, digital money, time
travels, 3D holographic imaging, telepathy,
controlling weather etc. which seemed
distant dreams are now achievable projects
under active research through the use of
digital technologies. It is very intriguing
to internalise now that one day almost
all activities would be digitally run and
controlled.
The possibilities of digitalisation driving
transformation of human society to a next
level of comfort and sophistication are
immense and only time will stand witness
to the changes digital technology would
bring to our planet.
20 | Digitalisation
23. Kapil Gandhi
Sonali Madnaik
Apeksha Bharuka
Europe
Austria
Belgium
Channel Islands
Cyprus
Czech Republic
Denmark
Estonia
France
Germany
Greece
Hungary
Ireland
Italy
Lithuania
Luxemburg
Malta
Netherlands
Norway
Poland
Portugal
Romania
Russia
Slovakia
Spain
Sweden
Switzerland
Turkey
Ukraine
United Kingdom
Asia-Pacific
Australia
China
India
Indonesia
Japan
Malaysia
New Caledonia
Pakistan
Philippines
Singapore
Tajikistan
Thailand
The Republic of Korea
Vietnam
North America
Canada
United States of America
Latin America and
the Caribbean
Argentina
Bermuda
Brazil
Cayman Islands
Chile
Dutch West Indies
El Salvador
Mexico
Peru
Uruguay
Venezuela
Middle East
Israel
Lebanon
Oman
Palestine
Qatar
Saudi Arabia
United Arab Emirates
Africa
Algeria
Angola
Benin
Botswana
Cameroon
Chad
Comoros
Congo (Brazzaville)
Congo (Kinshasa)
Djibouti
Egypt
Ivory Coast
Kenya
Libya
Madagascar
Mauritius
Morocco
Nigeria
Senegal
South Africa
Tunisia
(including Mazars
correspondent, country local
correspondents, joint ventures
and representative offices)
Global presence of Mazars
