In the news release, Media companies' digital revenues will overtake traditional revenues by 2015, issued 11-Jun-2013 by Ernst & Young over PR Newswire, we are advised by the company that the first paragraph hyperlink to the report was not working. The link has been corrected in the version that follows:
Media companies' digital revenues will overtake traditional revenues by 2015
- Over 550 senior executives from global media and entertainment companies see 57% of their revenue coming from digital by 2015, up from 47% today
- Organizational agility singled-out as a leading success factor in the digital era
- Study indicates that "digital leaders" have embraced smart mobile-social-cloud and big data analytics technologies to achieve agility
NEW YORK, June 11, 2013 /PRNewswire/ -- The average revenue of media and entertainment (M&E) companies will shortly cross the 50% mark from majority traditional to majority digital, according to a new report, Digital agility now! Creating a high-velocity media and entertainment organization in the age of transformative technology, released today by Ernst & Young that surveyed more than 550 senior executives from global M&E companies. Today, revenue from digital is 47% and survey respondents say that by 2015 it will account for 57% of revenue – thus making digital the new norm and the primary source of revenue for M&E companies.
The study goes on to identify characteristics of M&E "digital leaders" – companies that are using new technology not only to deliver digital products and services, but to build more agile organizations capable of sensing and responding far faster to shifting customer expectations and marketplace opportunities and risks. The digital leaders are pioneering the path to a higher level of organizational agility as the M&E industry transitions to digital as its new norm.
"Mobile-social-cloud and big data analytics technologies are game-changers for M&E firms," says
Pat Hyek, Global Technology Industry Leader, Ernst & Young. "These technologies can help M&E digital leaders who broke ahead of the pack in the early stages of digital to extend their advantages, as well as offer opportunities for those who fell behind to adapt quickly and catch up."
According to Digital agility now! Creating a high-velocity media and entertainment organization in the age of transformative technology, a major differentiator between these digital leaders and other survey respondents is a greater emphasis on mobile-social-cloud and big data analytics technologies for internal collaboration. For example, digital leaders are 60% more likely than all other respondents to emphasize the importance of social media for internal communication among employees: 67% said it was "very" or "extremely" important, versus 42% of all others. The study points to the kind of rapid collaboration that is enabled by social networks and characteristic of an agile organization, where silos are broken down by the ready flow of information.
The study shows that digital leaders' advanced social listening programs, leading-edge analytics and cloud-based infrastructure enable rapid deployment of new products and resources, and give companies the ability to quickly learn from and fix mistakes. This organizational agility is necessary
to meet the demands of rapidly evolving digital consumer behavior.
"Media & Entertainment companies no longer live in a world where everything lives in 'their' world. It's a connected eco-system with consumer technology leading the way," says John Nendick, Global Media & Entertainment Leader, Ernst & Young.
Other results from the survey include:
- Technology alliances: Digital leaders emphasize alliances that let them act faster than "going it alone"; 51% rank alliances with technology and other M&E partners among their top three strategic priorities for digital transformation, vs. 30% for others.
- Second-generation deployments: Digital leaders were generally more than twice as likely to incorporate lessons learned from initial technology deployments to achieve more advanced functionality. For example, 49% of digital leaders use second-generation mobile technologies to develop products/services vs. 16% of all others.
- Smart mobility: Similarly, 32% of digital leaders use second-generation or later techniques in mobility to enhance employee engagement and communication, vs. 13% of all others.
- Cloud: Digital leaders emphasize the importance of cloud computing to enhance internal and customer-facing flexibility. For example, 74% of digital leaders say it's important to host business tools in the cloud, vs. 49% of all others; and 43% of digital leaders use second-generation cloud solutions to speed product/service development vs. 12% of all others.
- Big data analytics: Digital leaders are three times more likely than other respondents to use second-generation big data analytics techniques to improve customer engagement (26% vs. 9%). Among all respondents, 66% rely on in-house resources to get insight into customers yet 41% say they gain no insight from their data, suggesting they don't have the right big data analytics tools or skills in place and may be better off partnering to access external resources.
The report concludes with an agility index that ranks the relative organizational agility of different M&E segments as well as enabling technology and digital leaders. The average score of all respondents is indexed to 100. A score of 110 denotes performance 10% above average; 90 is 10% below average.
Digital agility now! Creating a high-velocity media and entertainment organization in the age of transformative technology is one of five reports to be released in the Digital Leadership Study Series from Ernst & Young's Global Technology Center and Global Media & Entertainment Center. Conducted in conjunction with Oxford Economics, the study is based on responses from more than 550 M&E executives across industry segments including advertising, broadcast and cable, filmed entertainment, interactive gaming, publishing and information services, music and social media, as well as from the technology industry. The other reports will address managing digital growth, product development and business models, the changing relationships with customers and the "disconnects" that separate M&E companies and technology companies.
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SOURCE Ernst & Young