CHAPTER 2- A DIGITAL WORLD

1. CHAPTER 2- A DIGITAL WORLD

2. DIGITAL TECHNOLOGY • Everything on the Internet is digital I.e. all of its text and pictures are stored as a string of zero’s and one’s (or ‘bits’). • A bit is a single piece of information • 3 factors make the translation into bits such a powerful process: 1) Moore’s law 2) Ability to create digital environments 3) Convergence

3. 1) MOORE’S LAW • Noticed by Gordon Moore, a co-founder of Intel Corporation, based on engineering practices. • The falling cost of digital technology. • “Each new generation of chip technology, which has been released about every 18 months, can pack the same number of elements into half the space”

4. Using Moore’s Law • Input substitution- When an input to production gets cheaper, we substitute that cheaper input for other inputs that have stayed the same or gotten more expensive. • E.g. the switch to bits from atoms • Digital technology helps offset increasing costs (e.g. marketing and customer support) for organisations.

5. Language and Digital Substitution • Substituting bits for atoms saves money and creates new capability's • For example, the internet allows global companies to send messages and text to a variety of cultural audiences as language options are offered, as well as online translation services made available. • E.g. disneyland.go.com/disneylandresort

6. Will Moore’s Law continue? • Skeptics say that the doubling period would need to be adjusted to keep the law going. • Also, factories making the chips are becoming more expensive. • Conversely, supporters of Moore’s Law, such as industry commentators, argue that costs will continue to fall exponentially, reflecting the cost decrease of ‘Mainframe’s’ • The future of Moore’s Law has been controversially debated over the past couple of years: • Robertson, j. (2002) “Moore’s Law Namesake Predicts IC Density Growth could Slow” Available online (proquest)

7. 2) DIGITAL ENVIRONMENTS • The use of computers has extended from making simple calculations to creating entire digital worlds. • Digital environments are: a) Procedural b) Participatory c) Spatial d) Encyclopedic

8. a) Procedural • Computer’s are logical, pre-programmed engines that follow (‘procedural’) rules. • Internet marketing allows consumers to interact directly and independently with the digital environments. • ‘Procedural rules’ + ‘Participation’ = Interactivity

9. b) Participatory • Participation online is encouraged, and provides feedback between the user and the computer. • Participation helps users find the information needed, thus ease of use is important. • Help’s create ‘personalization’

10. c) Spatial • Digital environments can make participants ‘loose track of time’ and dismiss the ‘real world’ • Providing familiarity and comfort to users makes spatial environments seem less ‘daunting’, and more realistic. • E.g. disney.go.com

11. d) Encyclopedic • Digital environments allow large amounts of information to be stored cheaply and easily. • Cheap ‘bits’ allow marketers, for example, to avoid costly multiple product versions or ignore small markets e.g. a book publisher allowing various formats to be offered online.

12. The Future of Digital Environments • Digital environments are dynamic and are continually increasing in size. • Improvements are continuously being made to existing sites, including the ability to offer not only two but also three dimensional capabilities. • E.g. ‘e-toys’

13. DIGITAL CONVERGENCE • “…the merging of industries, technologies and content which used to be separate but now overlap...” (Hanson, 2000) • The merging of computing, communications and media content make up the ‘Interactive Multimedia’ triangle. • Companies composing the Multimedia triangle are merging e.g. Disney’s Go Network

14. HOW DIGITIZING WORKS • In order to take advantage of Moore’s Law, digital environments and digital convergence, text and images need to be made digital. • Digitizing text- Each letter of the alphabet is assigned a code. • Digitizing images- Each colour/shade of an object is assigned a number which is then represented by a ‘binary’ code. • Text and images are then stored digitally as a set or string of binary codes (I.e. ‘0’s’ and ‘1’s’).

15. DIGITIZING MARKETING PROCESSES • 3 step process followed by firms to take advantage of digital environments: 1) Archive- Retain and digitalize material 2) Substitute- Substitute digital materials into marketing processes e.g. Allowing staff at ‘Levi’s’ to globally view customer focus groups over an intranet’ 3) Redesign- Change marketing practices to better use digital features e.g. ‘e-tickets’

16. SUMMARY • The Internet is compiled of digital images and text, stored as a string of ‘0’s and ‘1’s. • Moore’s Law identifies the falling cost of digital technology. • Digital Environments are procedural, participatory, spatial and encyclopedic. • The Internet has allowed industries, technologies and content to converge. • Taking advantage of digital environments involves the ‘Archive’ and ‘Substitution’ of digital material, and ‘Redesign’ of marketing processes • Due to the rapidly growing, improving and dynamic nature of the technological industry, who knows what it will bring tomorrow??