Update on Review and Trends 2012

Duncan Stewart is one that needs no further introduction in Canada when it comes to discussing media and telecom trends as well as upcoming technologies. Since 2001, he’s been touring around Canada with Deloitte’s TMT predictions (this year’s schedule of upcoming presentations is available on their website).

We were in the fully-packed room at the Scotia Bank Theatre in Montreal last week to hear what Duncan and his trends analysts are foreseeing for this upcoming year. Here are some highlights:

Big data gets really big…

Although still marginal in terms of money (roughly $1.5 B compared to $3.4 T for global IT), big data gains importance in terms of quantity and traditional database management and analytics tools reach their limits. It’s time for ground breaking innovations. Not surprisingly, more than 90% of Fortune 500 companies will be on it one way or another in 2012, but 50% of these projects will be pilot projects.

Near field communication (NFC)

It’s a growing trend but 2012 should still be another “transition year”; the NFC technology will be used for payment but now also more and more for other uses (fast and easy way to exchanging data without relying on Wi-Fi or phone networks, one answer to these increasingly crowded networks).

Moving from HDD to SSD (solid state drive)

SDD are pricy (about 10 times the cost of their HDD counterparts) but they are convenient if not mandatory for portable devices (smartphones, tablets, ultraportables). They also become important for data centers (cooler, less energy-demanding). About 10% of the new centers to be built in 2012 should use SSD hardware.

Two tablets per household…

People used to move around their houses carrying their lights with them. Nowadays light is ubiquitous. Tablets should follow the same trend, transitioning from one tablet per household to one per person. On the longer run, it’s one per room or even more than could be the norm. Ubiquitous…

Portable devices as portable DVRs

Streaming being not always possible or the best solution (think of commuters in a train), tablets may turn into handy portable DVRs where users could catch up on the shows recorded the day before (30 B hours watched last year).

The caps are back

As the networks reach their capacity limits, we should see the end of the “All you can eat” wired bandwidth plans. Average cap is expected to vary between 150 and 250 GB per month, more than what most average users should need. This trend should last until fiberglass networks kick in (timeframe: 10 years).

TV schedules are still king

Viewed as dying not long ago, live TV is getting back stronger as interactions on social networks favour live shows. The latest stats (Nielsen report) speak loud: In the US, people watch on a weekly basis an average 32 h of live TV. Timeshifted comes second with… 3 h per week.


More and more companies are using MRI (Magnetic Resonance Imaging) technology to improve products and user experience. It’s something getting big but kept hidden by companies using it (competitive edge).

Online advertising: Emotions matter

Brand advertising online is gaining momentum and should catch up with TV where it is predominant. Less focused on click-through rates and the likes, it will focus more on brand and image building, such as illustrated in an online Chipotle (Mexican grill restaurant) commercial showed during the presentation. This long commercial (over 2 minutes) is all about emotions, with the name of the company only showing up – briefly – at the very end of it.

More links

To read our own review 2011 and trends for 2012.


TRENDS 2012: All together now

(Read introduction: Coming up next, review of the 2012 media trends.)

This Beatles favorite makes for the perfect title of the final chapter in our series 2011 Review >> 2012 Trends. The best summary of the current effervescence in the digital media sector (and the best stimulus for a discussion that goes beyond mere year-end predictions) can be found in a recent article by Erick Schonfeld, in which he compares the unprecedented proliferation of technology start-ups to the Cambrian explosion and makes this enlightening observation:

“The internet is today’s steam engine. Anyone can tinker and build an app or a web business. The pace of innovation is similar to what was seen during the tail end of the industrial revolution in the late 1800s (…) Today’s most productive machine is the computer. But that machine is increasingly useless if it is not connected (…) It’s not just that the network is the computer. The network is society, the market, and politics all rolled into one.”

In all activity sectors and particularly that of media creation and distribution, this evolution will continue until society (the user) merges with the market (right-holders, producers, distributers) and politics (legislative machinery, regulation). In fact, the past few years have seen the user begin to climb back up the hierarchical ladder, moving from passive receiver to active transmitter.

As far back as 2006, TIME named “YOU” person of the year. Yet five years later, a division remains. Business is prepared to “listen” and “dialogue” with the user and even integrate user-generated content, provided users not alter the editorial or marketing trajectory of the company. User-generated content remains distinctly separated from that created by the professionals, and only rarely does anyone venture into co-creation terrain, where developers, authors and users unite to form a nucleus of inventiveness.

Granted, this year saw the progression, albeit timid, of such phenomena as crowdsourcing, crowdfunding and the alternate reality game (ARG), which involves the user (online and offline) in an interactive narrative. But many industry players see these initiatives as just more ways for companies to lose control. Transmedia storyteller Lance Weiler views co-creation with the public as a chance to bring “happy accidents” into a project. The Japanese example of Hatsune Miku is an astounding illustration of how a new economy of collaborative creation can turn into a phenomenal business success.

Control is not lost, but it must be distributed…fairly.  

In the case of Hatsune Miku, creation is communal and users have the right to change and disseminate intellectual property (within certain parameters), but all contributions by the public must be not-for-profit. However, when the company uses the creation of a fan, a contract and remuneration are arranged. To not pay contributors would be an injustice, as demonstrated by the recent Voir vs. Huffington Post affair in Quebec(1).   Such should also be the case for the giant platforms that feed off of the data they collect on their users, turn this data into profits on the markets, and use it as an asset to capitalize their business on the financial markets.

The past year has also been particularly active in terms of legislative review, regulatory upheaval, legal battles, patent wars, and privacy issues. This fight for control will take on new vigour and will confirm that in a world of quasi-continuous connectivity, society, the market, and politics cannot just co-exist…they must cooperate.

Returning to Schonfeld’s evolutionary metaphor, only those species that are able to adapt to this environment will survive. The Cambrian explosion began in Canada; there’s no reason why our talent, culture and politics cannot contribute to shaping the world of digital content tomorrow!

(1) The upcoming launch of a Quebec edition of The Huffington Post recently caused quite a stir in the blogging community when the weekly VOIR revealed that influent Quebec bloggers would contribute to the site without being paid.

2012 TRENDS: Connected TV: evolution, not revolution

(Read introduction: Coming up next, review of the 2012 media trends.)

Unquestionably, over-the-top (OTT) services grabbed the attention of the Canadian broadcast industry in 2011.  The CRTC led (and continues to monitor the trend) a series of  consultations with the industry to examine the potential impact the arrival of players such as Netflix will have on Canadian content production.

With OTT services not subject to the same rules that govern Canadian cable operators and satellite distribution companies, the latter are demanding a level playing field, notably by asking for deregulation and greater flexibility (in Canadian content quotas).

While most of us were focusing on the high-profile subject of OTT services, other striking developments in the television industry were unfolding both at home and abroad. Cable companies may have concerns that new operators and content distributors are moving into living rooms, but television manufacturers are worried that the television is being moved out.

With media consumption habits changing and technology firms on the fast track, SONY, Panasonic, Samsung, LG and the like are facing a major challenge. Their ambitions are clear: via connected TV[i], the manufacturers hope to centralize use, win back their role as the entertainment focal point of the household, and enter the service and publishing sector to draw back control over the content-acquisition.

However, jumping on the Web-linked terminal bandwagon is not a panacea for an industry that has been built on closed distribution models. Not only will such a move serve to give third-party distributors (such as OTT services) yet another device on which to deliver their content, but broadcasters will have to compete with game publishers and developers, application developers, and the whole gamut of Web publishers—notably those who specialize in online videos, such as YouTube, Dailymotion and others—all of whom contribute to the video offering. In short, the issue of controlling the signal and diminishing the gap between content and user has become so crucial that a group of major French broadcasters took the step in late 2010 of signing a charter, most notably to control third-party displays superimposed on viewers’ screens during television programs.

So what’s next? Can we expect that in 2012 connected TV will create a tsunami of competition on your living room TV screen?

“Traditional” players need not brace for connected TV to create a massive disruption on the TV market, but blustery winds are nevertheless in the forecast. The so-called smart TV may already be enjoying steady penetration in the U.S. and Europe and will no doubt fare better than 3D models, but it still faces an uphill battle; in itself, it will never provide users with the same level of satisfaction they find on the Web in terms of social dialogue and personalizable choice. The reason for this is clear: the television screen is and will remain a shared screen. Social media and programming personalization functions make little sense when the terminal is designed to be used by many people at the same time. The response therefore lies in multitasking: everyone in front of the TV and each with their own second device to enhance the viewing experience.

Within this context, vertical integration of most industry players has been the first wave of response to the need to be on all screens.  Going further though, would imply that Media groups must break down the barriers and converge in areas that reach beyond their services; their programming strategies, advertising sales forces, and content offer should follow the same logic.

Additional reading: The Difference Between Connected TV, Social TV and Expanded TV & http://meta-media.fr/2011/11/22/cest-le-tour-de-la-tele/ (in French).

[i] Connected TV refers to television sets equipped for Web access, but “more than merely an HD monitor plugged into a high-speed Internet connection, it is no less than a multimedia entertainment management centre able to recognize and interact with a personal computer, a 3rd generation gaming console, and multiple modules while offering a wide range of functionalities, including a connection to social media networks.” (Free translation from ABC de la télé branchée, Evolumédia)

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2012 TRENDS: An avalanche of data

(Read introduction: Coming up next, review of the 2012 media trends.)

The avalanche of data available to companies who operate in the digital sector and the performance measurement of their projects will be a major issue in 2012.  All of the experts, whether their specialty is interactivity, mobility, social media, or online video, agree on one fundamental point: it is no longer possible to ignore the need to measure the impact and gauge the success of content and marketing strategies.

But how does one go about this in an uber-connected world, where data on audience, usage, engagement, sharing, conversion (and countless other aspects) flows—often in real time—and is generated by a multitude of platforms? How does one go about this in a world with an abundance of analytics tools yet few if any measurement standards or key success indicators?

Even once the established players adapt to the multiplatform and social realities of the digital environment (as was the case this year for comScore Canada, Google Analytics, Facebook  and Twitter, among others), the challenge remains massive for all involved, given the management effort, continuous analysis, and actions involved in wading through this sea of information.

Paradoxically, companies have never been in a better position to cost-effectively collect and store immense quantities of data, which is prompting a keen interest in all things related to big data. Furthermore, and following the example of other trends in the digital sector, particular attention will be paid to mobility and social media measurement, and the dialogue will be once again be led in large part by the advertising sector. It is clear, however, that this issue now goes far beyond purely marketing and promotional objectives.

Performance measurement is clearly a responsibility of every business, but it has also become an industrial issue in all sectors. In the audiovisual content production and broadcast sector in particular, a number of measurement consortiums and certification bodies have been created in recent years, sometimes on an initiative by the television sector (as in the United Kingdom and the U.S.), other times on an initiative by the advertising sector (as with 3MS from IAB) or by ODJ in France.  In certain cases, progress has been marginal, and in others a membership system has confined the application of standards to a limited number of players.

This trend is here to stay, and the Canada Media Fund will continue to do its part in 2012. Since late 2010, we have led a concerted drive towards digital performance measurement across the country, notably via the creation of an advisory committee and the introduction of a discussion forum. The result is a measurement framework that will be applied to all digital media projects funded through the Convergent and Experimental streams of the CMF and an implementation plan for the measurement system that will be introduced in the first quarter of 2012.

2012 TRENDS: Your virtual wallet

(Read introduction: Coming up next, review of the 2012 media trends.)

During the last quarter of 2011, competition in the new (and highly lucrative) mobile payment market intensified in North America, with Google launching its Google Wallet service in the U.S. in September, and VISA, Master Card and PayPal following close behind with a range of mobile transaction services. A recent study by Forrester Research predicts that by 2016, consumers will be able to pay for most of their purchases using their smartphones.

Mobile payment can take many forms. It may consist of using your cell phone to interface with the merchant’s terminal and finalizing payment with a simple click. Or it may involve using your phone to register your transactions, which in turn are added to the monthly bill you receive from your mobile phone operator, as is offered by Android for application purchases in the US and since 2011 in Europe.

In all cases, we can expect that the ease of shopping using mobile payments will build consumer confidence and drive the growth of business models such as in-app purchases or mobile advertising, both directly linked to the increase in paid app downloads.

In Canada, while the rush to mobile payment is less pronounced, a recent survey conducted by ING Direct demonstrates the extent to which Canadians are ready to shift their banking transactions to their mobile phones. Among the functionalities most sought (31% of respondents) from financial institutions is the possibility of making payments using smartphones.

In an environment where business and monetization models rule and where the ultra-connectivity of users can facilitate—indeed accelerate—this shift to transaction models, the mobile payment trend is clearly one to watch.

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TRENDS 2012: Behold, the resurrection of publishing

(Read introduction: Coming up next, review of the 2012 media trends.)

The extraordinary success of the iPad has generated unexpected spinoffs for the market; not since the onset of the “tablet revolution” had one of the devices truly captured the public’s interest.

Still, as of the second quarter of 2011, the use of tablets seemed confined to the affluent, with 45.9% of users having an annual income of more than $100,000 (Comscore, Digital Omnivores). But now, with the introduction of the Kindle Fire, Nook, and other tablets for under $200 and the emergence of initiatives such as DataWind in India, the tablet is poised to become the latest gadget for the masses and may have the same impact on the e-publishing industry as the iPod had on digital music distribution a few years ago.

According to the economic news coming from the media industry, newspapers and print publications have been at the top of the “endangered species” list for the past three years. However, by the end of 2011, encouraging news was coming from publishers whose apps for tablets had pushed their profits beyond the forecasts, prompting renewed hope. Such is the case for The Economist and magazine publisher Hearst.

Despite statistics on mobile application use showing that game downloads systematically represented the most popular application category in 2011, data recently released by SODEC indicates genuine signs of growth, notably in the U.S., where digital book sales rose by 162.9% in the first quarter of 2011, reaching US$313 million, while print book sales dropped by 18.7%.

Certain emerging phenomena suggest that e-publishing and digital distribution of narrative content will gain increasing popularity in 2012. Among the observable trends are a keen interest in self-publishing options (Amazon, Wattpad) and for aggregation and page layout applications such as Flipboard.  Will 2012 be – as promoted by the Economist – the year for Leanback 2.0 ?

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2012 TRENDS: SoLoMo (Social+Local+Mobile)

(Read introduction: Coming up next, review of the 2012 media trends.)

Widespread availability of mobile and WiFi technologies and the confirmed enthusiasm of social users are paving the way to a new approach to delivering content “just in time” and marrying business models with brands “near you”: SoLoMo.  This emerging term (amalgam of SOcial+ LOcal (or location)+MObile)  will certainly be among the popular buzzwords in 2012.   Why?  Three main reasons:

1) Mobile and ultraconnectivity:
As mentioned by Paul Burns, VP Digital Media from Shaw during a panel at Next Media 2011 – “Since 2008 , we’ve been saying that this year is mobile year!”.  Well it will certainly (again!) be the case in 2012…  Mobile devices are driving unprecedented growth in a) consumer’s adoption both for tablets and smartphones, b) advertising spending and c) technological developments.

2) Location and local content:
Now that GPS capabilities are widespread (according to Comscore, in 2011 three out of four mobile subscribers have GPS capabilities), the interest in local content is also rising as people are looking for things that are relevant to them in their context: their city, their place in the city, the people they interact with.    According to Stephen Hoover, chief executive of Xerox’s research and development unit (PARC): “We’re at the cusp of really being able to integrate all of these different sources of data and understand people’s intention in context and give them the information that’s useful at the time they need it”.  From a strictly marketing point of view, it is highly probable that when you are pushing the right content, at the right moment, in the right place, there are less steps to be made to convert a user into a buyer.

3) Everybody is Social
According to George Colony, Chairman & CEO of Forrester Research,  “social penetration” (ie online users having accessed or used social media) has reached its limits.   Based on extensive surveys, Forrester reports that “social penetration” is over 75% everywhere in the world (86% in Canada), and that people already spend as much time as they can on social.   So what’s next? According to Colony, there is now an opportunity for developing more efficient, faster and anti-”time-wasting” social apps.  This seems to correlate with data related to usage on mobile phones: according to Comscore, “search” is the top activity of mobile browser users. Social networking is second.

In order to maximize the possibilities of SoLoMo in the future, it is important to remember that this is a concept related to how/when to ACCESS and INTERACT with CONTENT… it cannot be considered as a product in itself without having a well thought out content to deliver.    But content producers and brand owners must understand the huge possibilities (both business and creative) offered by SoLoMo.  For example, as smartphones are getting more “up, close and personal”  with voice activation and dictation technologies (e.g. Dragon Dictation; and Apple’s newbie SIRI), that “friendly voice in your phone” could take the concept even further.  Imagine walking by a movie theatre and hearing your phone calling you by your first name and reminding you that new movie from that obscure Bosnian filmmaker you like is only playing there for one more day…

Exemples of Solomo applications funded at the CMF:
My City Lives