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Innovation driving strategic choices for P2P

Innovation driving strategic choices for P2P. Saul Berman Global & Americas Leader, IBM Strategy & Change. Technology driven innovation across consumers, business models and business design impact P2P. Demand will increase Social networking & consumer engagement.

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Innovation driving strategic choices for P2P

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  1. Innovation driving strategic choices for P2P Saul Berman Global & Americas Leader, IBM Strategy & Change

  2. Technology driven innovation across consumers, business models and business design impact P2P Demand will increase Social networking & consumer engagement Monetization remains a core question Content monetization & new business models Business ModelInnovation Consumer Innovation TechnologyDisruption Business Design and Infrastructure Innovation P2P can address challenges Content explosion & efficiency challenges | 4-Jan-20

  3. Explosive growth in consumer interaction 2008 Global Digital Content Adoption 2008 2007 Source: 2008 IBM Digital Consumer Survey. Total responses = 2800 across six countries: Australia, Germany, India, Japan, UK, US. IBM 2007 digital consumer survey: Total responses = 2800 across five countries: Australia, Germany, Japan, UK, US *This category was not included in the 2007 survey. | 4-Jan-20

  4. 100% 89% 90% 84% 80% 68% 70% 60% 50% 45% 40% 36% 40% 31% 25% 30% 25% 25% 20% 13% 10% 7% 0% Passive Experiencer Engaged Influencers Contributors Consumer engagement especially among the digital “savvy” – driving growth of user generated content Digital Content Interaction with Online Video Gadgetiers Aggregate Massive Passives Kool Kids Influence and Interaction driven by the digital “savvy” % who have watched online video % who have uploaded videos % who regularly watch online video % who have rated video content online Source: 2008 IBM Digital Consumer Survey. Total responses = 2800 across six countries: Australia, Germany, India, Japan, UK, US | 4-Jan-20

  5. Increased sharing and distribution of video content among social networks drives consumer internet traffic growth Global Consumer Internet Traffic forecast Cagr 2007-2012 104% 57% 24% 44% 30% 31% 34% • In 2012, the sum of all forms of video (TV, VoD, Internet, and P2P) will account for close to 90% of consumer traffic • In 2012, Internet video (crossing Internet backbone) will be nearly 400 x the U.S. backbone in 2000 | 4-Jan-20 Source: 2008: Cisco Visual Networking Index: Forecast 2007- 2012

  6. Three waves of Internet video growth Internet traffic Video Communication IP Video to TV IP Video to TV IP Video to PC IP Video to PC IP Video to PC Time 3 2 1 Increasing video traffic over the Internet challanges M&E companies to manage distribution cost • M&E Companies must manage distribution cost - especially in the current economic environment • Disruptive innovation in CDN/P2P space can potentially reduce distribution cost by 50-80% Source: 2008: Cisco Visual Networking Index: Forecast 2007- 2012 Cisco 2008: Video, catching the next wave, Marthin de Beer | 4-Jan-20

  7. Create Manage Distribute Consume Service Lessons from the music industry: Value is not disappearing but shifting closer to the consumer Music Value Chain In-Home Services Distributors Record Labels Devices CAGR -1% CAGR 18% CAGR 11% Global CAGR* -3% 2008 Size: $20 billion Size: $12 billion Size: $37 billion Size: $2 billion US CAGR -5% US CAGR -5% Promoters KEY CAGR 10% Decreasing share Size: $13 billion Increasing share Sources: PwC Global Outlook 2008-2012; CEA Market Research 2008; Veronis Suhler, 2007; eMarketer, 2007; IBM Analysis “CAGR is 2003 - 2008 | 4-Jan-20

  8. Lessons from the Advertising Industry:Fundamental shift in capability requirements Consumer-centric marketing: What is it? From To ADDRESSABILITY Broad Micro MEASURABILITY GRANULARITY Impact Impressions INTERACTIVITY* One-way messaging Two-way dialogue CONTINUITY Integrated, cross-platform Single Platform INTEGRATION CONTEXT Ad message disjointed from adjacent content Message tightly coupled with adjacent content *Interactivity considered a feature that is not essential to all advertising formats. | 4-Jan-20

  9. P2P need to identify revenue models across theemerging ecosystem End Customer Subscriptions Pay per Use Access Wireless and Fixed Internet Access providers Telco/ISP Access $ Peering charges for access to content Typically no charge $ CDN Peering/CoLo charges to shift content around CDN CDN Large network and cache of a variety of content Internet Core Global networks transporting Internet traffic $ Charges for amount of data cached Possibly charges for bandwidth used OTT Providers Content, media and Application providers Variety of transactions/models Per click or basic ad revenue Internet Core OTT’s End Customer Advertisers | 4-Jan-20

  10. Saul J. Berman Partner & Global Executive IBM Global Business Services saul.berman@us.ibm.com | 4-Jan-20

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