In my last post, I looked at the first three overriding themes of the 'digital shift'. This time, I'll look at the next four.
T4: The digital citizen/consumer calls the shots
Ultimately,everything starts and ends with the consumer who wants to enjoy a wide range of creative products on the new digital devices, moving seamlessly from literature to films, games, music and more. More than that, the reader wants to engage in different ways, as an active participant and contributor to an online community as well as a consumer of the creative work.
So it's the consumer/citizen who is really driving change. From publishing to music and games to films, we are seeing innovative cross-media partnerships to create new content for consumers and make them available across a whole range of platforms.
On the legal front, the rise of 'over the top' services to consumers means that many companies which used to be 'B2B' (e.g. film and TV producers and publishers) are now 'B2C', engaging directly with consumers. Suddenly, consumer law in all its forms, from marketing, sales and contract law to data protection, is their problem. Put another way, it's actually an opportunity to build brand and reputation for those that get it right.
T5: Mind the [Digital] Platform
From digital gorillas like Facebook, Amazon, Google and Twitter to social media start-up platforms, the nature and variety of online platforms bringing content, services and communities together continues to proliferate. They are the real 'digital disrupters' in the value chains in almost every industry, and represent an increasingly significant part of the digital landscape.
The legal issues around T5 are as varied as the platforms themselves. At the top of the legal list are competition law (arising from the market dominance of the 'gorillas' in this sector), liability of platforms for hosting illegal content and the role the law may require them to play in enforcement of rights e.g. under the Digital Economy Act in the UK.
T6: Collaboration is the name of the game
“Collaboration is crucial for the industry’s survival. If, to try and protect their rights, companies and rights holders remain in silos and don’t collaborate, revenue will be limited.” - Neil Blair, Pottermore.
“Collaboration” is defined as “the action of working with someone to produce something”. Interestingly, the same definition cites the “traitorous cooperation with an enemy” as an instance of collaboration. So it is certainly not synonymous with a harmonious relationship. Collaborations can be tough, conflictual and competitive as long as they work and deliver sufficient benefits to the collaborators.
Collaborations come in all shapes and sizes in the ‘post digital shift’ world. Some are operational, where the publisher outsources a business function to a third party, such as an e-commerce platform or the provision of payment or product fulfilment services. Others are strategic, where the relationship enhances the publisher’s brand or enables it to increase market share or to enter new markets, so truly adding value to the business. Think of partnerships like Spotify’s deal back in 2009 with Swedish Telco Telia and Deezer’s deal with France Telecom to reach bigger audiences for digital music streaming services.
So on the legal front, the structuring of collaborations is equally diverse, ranging from straightforward contractual relationships, licences, corporate joint ventures, agency through to full blown mergers.
T7: ‘Consolidation and fragmentation’
All these changes are driving consolidation within different industries as companies seek scale where needed (e.g. proposed merger of Penguin and Random House). But, at the same time, markets are fragmenting as industry players seek to build their brands by creating niches.
For instance, Rebecca Smart, CEO of publishers Osprey, recently wrote a piece in the Bookseller about the need to organise around ‘verticals’ i.e. creating imprints for specific genres/ subjects/ markets. “With a branded collection of books in a vertical you can reach customers via retailers that sell other products in the same areas of interest. And if you have a brand you can sell direct to consumers.” (source: Bookseller, 2/11/12).
Whilst her comments relate to the publishing industry, they are also relevant to other markets affected by the ‘digital shift’.
Have a good week.