Impressions from IBC 2 - Sony and DECE

With apologies for the time lag (work has been particularly crazy recently), here's the second summary of my conversations from IBC. This time the interviewee was Spencer Stephens, SVP of Technical Services for Sony Pictures Entertainment and the topic was Google TV and DECE.

Stephens believes that there are two key game changers for IP - connected TVs and the move from physical to digital content 'lockers'.

With regard to the first, Google TV is a game changer. Stephens wasn't a fan of Apple TV as it's just an add-on to the TV, unlike Google, which is a hybrid of TV and the Internet and enjoys some of the benefits of both. It integrates EPG, DVR, purchased content and so on. Personally, my concern with Google TV is that it disintermediates broadcasters by focusing on content brands. Consumers are more likely to search for 'Top Gear' than for 'BBC 2'. Branded channels are a way round this, but I feel that they immediately restrict the value of Google search - I can find stuff using the EPG search equally easily. The only upside I can see is if Google TV can search across multiple devices attached to a home network. If so, that would be a genuinely cool feature for the mass market.

On the move towards digital content lockers, Stephens predicts that in 2012, 20% of the content sold globally will be delivered digitally (12% of revenues), up from 1% in 2008. At the moment, the limitation on e-sell through is the walled garden silos that limit consumption to a single platform. This is the rationale for Ultraviolet, supported by the DECE consortium. In DECE's opinion, there are 6 roles in the content ecosystem that will enable the transformation to a single digital content locker:

Content Provider
Retailer
Locker Access Service Provider (which streams the content)
Digital Service Provider (provides order fulfilment for the retailer)
Client (device) implementer (I guess that means Sony and Cisco, looking at the partner list)
DECE co-ordinator (which manages access to the locker)

In this ecosystem, I can access my content on any device, at anytime and from anywhere. Me, I'm a cynic. This is one of several DRM schemas out there - Disney's Keychest being the other notable example. The trouble is that they've just created a larger silo, locking everyone into another stiffling closed ecosystem where a consortium generates innovation. And again, there's a prisoners' dilemma, because unless everyone goes into the consortium, the best place to be is outside as having different technology could easily swing the game in your favour. Chances of Apple ever being involved? Zero. Likewise Google, I should think.

As for the six part ecosystem, it's yet another attempted carve up from the companies that have hitherto failed to capture value out of the digital content ecosytem. Good luck with that.

Impacts of a handset leasing model on mobile telcos

Following yesterday's post, here's some related thinking on the impacts on operators of handset leasing. Handset sales represent around 25% of operator revenues in a typical European market, but generate only around 5% of margin. It may therefore be the case that the scenario described would lead operators to a more profitable structural model than exists today. Oil companies are consistently and acceptably profitable, despite being (literally in some cases) the ‘dumb pipe’ that operators are so desperate to avoid becoming. One of the reasons for the oil majors sustained profitability is clear focus on their role in the value chain – to supply the fuel that enables transportation, relying primarily on location, then brand and finally product innovation to compete. BP or Shell do not need to subsidise the purchase of a car in order to drive consumption of fuel because consumers are ‘hooked’ on it (it gets them from place to place) and there are many credible car manufacturers an

Value drivers for telecoms retail

I've been doing a really large number of driver trees recently - we've taken to using them on every project to get really into the guts of value creation for businesses and thus decide where to focus initiative development (How To Win, if you're keeping score). Anyhow, I had to pause for thought recently to work out how to represent the subscription aspect of telecoms retail for a client. Since it took me a minute, I thought I'd share... its lack of elegance suggests that its not quite right, although it was enough to demonstrate that there was a certain lack of coverage in the initiatives that my client was pursuing and thus spark a debate. Enjoy.

Chief Strategy Officers II - Career Development

Here's a follow up to my earlier post on the starting point of Chief Strategy Officer (CSO) careers in the FTSE 100 and S&P 500 companies - a visualisation of two steps in their careers: their first employer or job and the job they had before they got their current position. Lots of work went into this... so any insights that you glean from the visualisation would be great to hear about :). The CSO is a crucial strategic role on the executive (!) and the owner of the tone and philosophy of decision making across much of the business, knowingly or unknowingly. Scrutiny of their experience in defining the process and language of strategic management is therefore appropriate not just amongst their executive peers, but in my view amongst shareholders. The days when being very smart and able to analyse large amounts of data were enough to be a CSO are basically gone... has the profession moved on enough to cope?

Versatile Amphibian

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