Senior members of both the advertising and entertainment industries were represented on the panels, yet the technology players (i.e. the software developers and the electronics manufacturers) were notably absent. I believe it would be illuminating to hear what's on the horizon from their perspective; I suspect that a peek at the future could be very frightening for some traditionalists, considering that digital technology with its many capabilities and devices is recasting complete industries and changing the landscape right under our noses.
Frankly, advertisers and marketers who are struggling with acceptance of the reality of DVRs and other manifestations of digital technology are about to be run over by the next wave of the future, broadband.
At the recent Consumer Electronics Show, Bill Gates announced Microsoft's commitment to the development of convergence software. In layman's terms, that's software that will ultimately link virtually all digitally enabled devices together, such as your phone, computer, television and more. Convergence software will be the DNA of the digital future, and it is the foundation of a new global medium called broadband.
A high-powered version of the Internet as we know it, broadband is often referred to as "the Internet on steroids." The next generation of broadband will be capable of delivering streaming media and digital content in close to real-time speed and will arrive in-home via digital high speed connections supplied by cable, DSS, or telephone lines. In tech circles, it is widely predicted that broadband will quickly replace "over the airwaves" broadcast as the primary in-home delivery medium.
Fully evolved, the broadband medium will be interactive and extremely versatile. Several noted researchers predict as many as 44 million broadband connected households before the end of 2005. With convergence software as its connective tissue, broadband will be a global information and entertainment delivery medium, operated 24/7 by portals such as MSN and Yahoo!
Broadband's capabilities will undoubtedly change the way advertisers advertise and marketers market. The much-feared message avoidance technology, i.e. DVRs, will be a major broadband feature. As they are doing today in growing numbers, DVR-enabled viewers will digitally record their program choices, for anytime commercial-free viewing. This may well spell the end to traditional commercial-supported broadcast television as we know it today.
NEW SUBSCRIPTION MODEL
Without the fuel of 30-second commercial money, a subscription-based model will emerge. Entertainment content producers in particular will be forced to seek new ways to finance content production. Shared subscription fees, sponsorships, alliance relationships and transactional product integrations will become primary sources of production funding and profits. HBO is certainly demonstrating that viewers will respond to interesting programming offered on a subscription basis.
The broadband medium will create much more audience fragmentation than we have today; viewing audiences will become deeply segmented by an increased volume of topic-specific programming. This type of programming will be very attractive to marketers because it will allow them to directly, more efficiently, hit their desired targets. Content will be narrower and more defined and very specific to the viewer's interest, thus, it is reasonable to assume that viewers will watch a commercial that is germane to the subject, i.e. a Shimano Fishing Reel commercial in a fishing show.
The interactive capability of broadband technology will facilitate in-program transactional product placements. Viewers will simply click through to a marketer's e-commerce site or be directed to a local retailer to purchase a product they see in a program they're watching.
Laser-targeting consumers with messaging sounds like happy news for marketers and advertisers. However, this vision of the future must also consider that many of the creators of tomorrow's topic-specific content will be very small production entities because of the ease of shooting and editing digital materials.
%%PULLQUOTE_LEFT%% As an advertiser or marketer, your task, or your agency's, will be to find the producers before they produce the content and to secure the appropriate rights that will allow you to package it for your marketing purposes. A willingness to engage the future and adapt to the changing landscape is crucial to the continued success of companies residing on both Madison + Vine.
And for those who are unwilling to consider the technological sectors' impact on the future of entertainment marketing, they will likely be blindsided by the combination of boadband and message avoidance technology.
The message is crystal clear. Everyone should be planning for the future as much as they are dealing with the issues of the day.
Norm Marshall is founder & CEO of Norm Marshall and Associates Inc.,NMA Marketing & Entertainment Los Angeles, New York City, Sydney, Tokyo.