The mobile digital newspaper Business scenarios for ePaper devices Leo Van Audenhove Simon Delaere Pieter Ballon Mic

1. The mobile digital newspaperBusiness scenarios for ePaper devicesLeo Van Audenhove Simon Delaere Pieter Ballon Michaël Van Bossuyt Studies on Media, Information and Telecommunication (SMIT) Institute for Broadband Technology (IBBT)

2. CONTENT • E-paper project • Business models • Conclusions • Lessons learned for the newspaper industry

3. 2 - E-paper project • Project goals • Generate generic knowledge about the potentials of news content on a dedicated electronic reading device • Iliad eReader based on eInk • Test some common hypotheses concerning success factors in practice • eInk Technology • Ink carrying a charge which can be updated by electronics • Paper-like high readable screen • Look of real paper • Ultra low power consumption

4. 2 - E-paper project - Partners involved • De Tijd • High brow newspaper focusing on business sector • Philips & iRex Technologies • Development of ePaper devices • iRex Technologies is a spin of company of Philips • Belgacom • Belgians incumbent telecom operator • Hypervision / Agency.com & iMerge • Two advertising agencies specialized in electronic advertising • Flemish University Institutes

5. 4 - Business modeling • Research Question • What are possible business models for ePaper devices in the newspaper industry? • BUT: technology broadens scope • Publishing industry - Print Media • Information industry • Starting point • Innovation in technology offers new business opportunities • BUT: technology does not operate in vacuum • Technology and business models are shaped by the business environment and actors involved • Complexity of innovation/product development is growing • Created in value networks • Often involving multiple actors

6. 4 - Business modelingframework Strategic alignment between all four dimensions required in order to create viable and sustainable business models Four main business modelling dimensions: • Value network • Financial model • Functional arch. • Value proposition

7. 4 - Business modeling - Roles • Roles in value network • Advertising & device suppliance • Place depends on business model • Service provision • Place depends on actor taking up this role • Related to who has contact with customer

8. 4 - Business modeling - Scenario development • Scenario method • Why: largely prospective research • Based on 2 basic uncertainties • Identified on the basis of: • Desk research • Interviews with actors involved • Interviews with actors in the Flemish Contexts • Basic Uncertainties • Aggregation versus disaggregation • Extent to which newspaper content is offered as an editorial product • Open versus closed • Extent to which the device is open to content from multiple players

9. 4 - Business modeling - Scenario development

10. Newspaper-Model: Scenario Outline • One content aggregator offers service • Based on its own content e.g. Newspaper • Making use of new capabilities of technology • Regularly updating content • Offering information aimed at specific segments • Personalizing content • Integrating personalized advertising • Close to current ePaper project • De Tijd as leading newspaper

11. Newspaper-Model: Value Network • Newspaper • Integrates content production, aggregation and platform content aggregation • Device manufacturer • Keeps certain control through configuration device/software components

12. Newspaper-Model: Value Network • Service provision • Logical that newspaper will put service in market • Has a good customer relationship • Has content for which customers want to pay • Have certain market intelligence • Third party content • Content from the mother publishing house • Content from outside • Expected to be complementary • Direct competitors unlikely to support platform

13. Newspaper-Model: SWOT

14. Newspaper model - Examples • Yantai Daily Media Group (China) • Offers since Oct 2006 all its newspaper titles on the Iliad eReader • PCM Uitgevers (The Netherlands) • De Volkskrant, NRC Handelsblad, ... • End of May 2007

15. Kiosk-Model: Scenario Outline • Intermediary offers integrated service • Access to aggregated content • National and international newspapers • Magazines, Comics • Books, etc. • From different content providers/aggregators • Analogy with newspaper stand • Newsstand, Zinio

16. Kiosk-Model: Value Network • Intermediary plays important role • Integrates two markets 1) readers; 2) information providers • Causes network externalities, especially online • Advertising possible at two levels • Can cause friction

17. Kiosk-Model: Value Network • Service Provision: two options • Through intermediary • Newspaper looses costumer relationship • In analogy with purchasing paper in newsstand • Intermediary (different from device supplier) • Will favor open standards • Will try to publish on different devices • Will be forced by content producers to protect content with DRM

18. Kiosk-Model: SWOT

19. iTunes-Model: Scenario Outline • Intermediary offers integrated service • Access to disaggregated content • Single articles from national and international newspapers, Magazines, etc. • Comics, Books, etc. • From different content providers/aggregators • Service only available on specific device

20. iTunes-Model: Value Network • Intermediary plays central role • Integrates two markets 1) readers, 2) content providers • BUT ALSO device suppliance and service provision • Content on single platform and on only one type of device • Disaggregation of content

21. iTunes-Model: Value Network • Service Provision (disaggregated content) • Through intermediary • Newspaper looses costumer relationship • Newspaper looses part of editorial function • Intermediary and device supplier same actor • Might favor proprietary standards • Will favor compatibility with own devices • Will be forced by content producers to protect content with DRM • Intermediary might shift to content provisioning • E.g. audible

22. iTunes-Model: SWOT

23. iTunes model - Example Sony Connect Sony - e-Reader and website (http://ebooks.connect.com)

24. Web-Model: Scenario Outline • Device as gateway to the web • User can access all content • Web, blogs, newssites, egov applications, etc. • Might be supported by push elements, e.g. RSS • User can upload own content • PDF, Word, etc. • Still possible to procure paid content • Using different open and proprietary standards • Costumer becomes aggregator in terms of own selection

25. Web-Model: Value Network • No integrated service concept • Device supplier central in scenario • But integrates no other central roles • Might control platform provision through software • Newspaper role more marginal • In competition with online content/information

26. 5 - Conclusions • Newspapers • Remain in a rather unique position as mass medium • Have strong costumer relations • Have shrinking market but willingness to pay • ePaper allows for more constant monitoring of newsreaders • Believe in value of editorial function

27. 5 - Conclusions • For newspapers kiosk possible scenario • Most Flemish actors seem to prefer this scenario or variant on it • BUT strong competition between large groups • iTunes model possible scenario for print & ebooks • BUT most online examples rely on long tail • Newspapers have short tails • Time and Uniqueness • Scenarios might co-exist • Could gradually shift from I to IV over time • Path dependency might be possible pitfall

28. 6 - Lessons learned • High potential of the device vs. Importance of look ‘n feel • Positive on screen quality and size • But look ‘ feel of newspaper • 48,9% of test panel would consider buying an eReader (if fully operational) • Reading device (vs. All in One) • Old habits die hard • No change in reading pattern • Strong link with printed newspaper • Navigation • Content (trust, aggregator,...) • Representation • Substitution or complementarity? • In this stage, the device is not ready but it provides users with some additional options (time, place) • Strong competitor for printed paper in the long term

29. 6 - Lessons learned • Control of the user: choice/complementary: AND & AND story • Personalised & full • News of today (breaking news) &. News of yesterday • Payments: fee & free • Newspapers as aggregators • Brand as trustmodel • Offer • Certified, trusted & authentication

30. Contact • Leo Van Audenhove • Leo.Van.Audenhove@vub.ac.be • Simon Delaere • Simon.Delaere@vub.ac.be • Pieter Ballon • Pieter.Ballon@vub.ac.be • Michaël Van Bossuyt • Michael.Van.Bossuyt@vub.ac.be • Websites • http://smit.vub.ac.be/ • https://epaper.ibbt.be/