Content services

Content sectors are each at very different stages in the digitisation process. But all are feeling the impact of changes in consumer behaviour and business models. Veteran players are being cut out of the loop, to the benefit of new online players, but the issue of growth is clearly still very much alive.

Sectors in turmoil

The content industry as a whole is having to deal with major upheavals created by the digitisation of content, its distribution and consumption. In addition to the rapid adoption of new consumption methods, which are making traditional ones obsolete to some degree, the advent of new players aggregating and distributing content online, along with the emergence of new business models, has shaken up both the markets’ players and their organisation.

Changing business models

If advertising is an integral source of financing for television and traditional print media outlets, it has also become a component in the new digital economy for music, video games and even books. But it is the commitment-free monthly subscription model that has really taken over as the new universal access model for content, coming to replace the purchase of singles, PPV and rentals.

Books continue to resist the move to digital

The impact of digitisation nevertheless varies a great deal from one content industry to the next. While video games have moved almost fully over to digital, not least because of the development of mobile gaming but also gaming on computers and home consoles, the book today remains the chief holdout, resisting the move to digital products and consumption, with stubbornly low adoption levels and very slow progress for e-books.

Intermediate links in the value chain are the most vulnerable

The consequences of all this for the value chain are very real, however. Traditional publishing and retail players are being squeezed out of the loop by e-commerce giants and the main online content aggregators. They are struggling to reinvent themselves in this new environment of self-production and self-distribution, which enables new young talents and veteran producers alike to reach their audience directly, and cut out the middlemen.

Digital driving growth in all sectors – except print media

Despite the difficulties that some of these players are facing, all the different content segments continue to grow: digital music sales now outweigh physical album sales, and are offsetting the inexorable decline of CD sales. The only exception for now appears to be physical print media sales, as the consumer shift to reading online is neither being offset by an equivalent rise in online ad revenue, nor in a comparable tendency among readers to buy an online subscription.

Books still resisting the move to digital
Growth remains steady