Marcel Fenez,global managing partner,entertainment and media practice at consultancy firm PricewaterhouseCoopers says the media and entertainment industry is undergoing a structural change.
Did you notice anything unique while you were putting together this report?
We had predicted that the recession would drive change,particularly in case of digital migration. That was right and in some cases the number was more than we initially anticipated. This years important story globally was how consumers are now talking about their devices. That didnt come through so clearly last year. We have really seen some important devices grapple in the market. I think theres now an appreciation of the fact that the mobile story was a story of its own and it wasnt complete until you had the right device. Till we had the smart phone we may have had a mobile story but it really wasnt as compelling from the content consumption aspect.
Your report talks about migration of consumers to newer mediums like the internet,but people are unwilling to pay for online content. So whats the real picture?
Consumption of all mediums has increased whether its the online media or traditional media. So we are still watching television and at the same time communicating online and chatting about what we are watching. So we are seeing an explosion in consumption because of multi-tasking.
Now,the extent to which people are ready to pay depends on a number of factors. And there is no question that there is huge piracy and if people get something for free then they wont pay for it. Thats why we are seeing experimentation. We are also seeing content providers realise that they have to add more value than just content. So the ability to pay is still there. The question is what will they pay for and how do you make them pay. We have to look at various micro opportunities.
What do you mean when you say that the recession was structural?
The recession has resulted in a structural change on the industry. Its the structural shift of the consumer to digital. And the reason why we are calling it structural is because brands are realising that if they still need to talk to people then they have to present themselves in a totally different way. And therefore traditional advertising doesnt come back. So,there is absolutely no change in that,particularly in the developed markets. For developing markets,its a different story.
So whats the story of the developing markets?
The developing markets are still driven by economic growth. You have new brands coming into the market. And with more brands coming there will be more advertising. So structurally its a different story.
Do you see brands and agencies working closely to push up advertising?
Yes,there are so many different types of partnerships and alliances happening between brands and agencies. In the simplest form we are seeing product placement. But now we are seeing whole branded channels. Advertising agencies are now working with content providers and they are producing branded content.
What will be the future for print in India?
India is fortunate that there is still growth in this segment. And that is driven by two factors. One is basic economics and second is literacy. The challenge at some point is going to be how does the print industry prepare itself for the inevitable. But I think the hope is that a lot of mistakes have been made in other markets and one can learn from them. The good news is that India still has time to figure out how to protect this traditional industry.
In the global perspective,we need to be careful about using the word print because I am optimistic for some brands that may have been associated with print. So I think certain key magazine titles will have very successful growth. So I am quite bullish from the magazine point of view.
Do you think India is still wobbly on the mobile advertising front?
I wouldnt say that India is any different. Mobile advertising has been wobbly in many markets. But that is going to change and there are some game changers. Firstly,people now have the device where they feel comfortable using real rich content. Mobile advertising is still a journey that we are on and India is no different. The most successful global markets are the ones that have content and stable platforms. And you are looking at a very small percentageone-two per cent globally. Growth will also depend on where the brand will be comfortable advertising.
Are business models in the entertainment and media space changing fast enough?
The question is not whether the business models are changing,its whether organisations are receptive to the changing business models. I think the biggest challenge of all is the speed and reaction to this behaviourare you flexible enough to implement it and have multiple business models going at the same time.