The Sedona Conference Dublin

The Creative Process: Demystifying Digital Media

(http://www.digitalmediaintelligence.com/sedona.html)

The Secret Life of Content and

The Digital Media Value Chain

Presented October 24, 2002 in Dublin, Ireland by

Mark Goldstein, International Research Center

PO Box 825, Tempe, AZ 85280-0825 USA, Voice & Fax: 602-470-0389,

markg@researchedge.com, URL: http://www.researchedge.com/

2002 - International Research Center (Version 1.0)

Content takes many forms and travels in many ways, yet has a clear value chain even in these transitional and transformative times. As the interlocking elements of content creation, digitization, aggregation, distribution, and consumption continue to drive both converging and diverging distribution channels, enormous confusion and opportunity abound. Content producers, content enablers, and tool makers as well as other digital media players need to clearly understand the value they create or add and the interests and concerns of their upstream and downstream partners and customers. This session will analyze content distribution networks (CDNs) and digital media value chain models, discuss how technology has enabled ever-broader digital media distribution, and illustrate the impact on content producers, the marketplace, legal issues, and consumers.The Secret Life of Content and The Digital Media Value Chain

By Mark Goldstein, International Research Center

The Sedona Conference Dublin, October 24, 2002

Transitions in Transportation ModalitiesSource: Trillium (The Future is Ahead of Schedule)

Growth of Information Technology in the EnterpriseSource: Intel (Creating the Possible: The Evolution of Information Technology, 2000)

Adoption of Various Technologies in the U.S.

Source: UnderstandingUSA.comGrowth of Internet Connections

Source: The Death of e and the Birth of the New Economy by Peter Fingar & Ronald Aronica, 2001

Evolution of the Modern Supply ChainSource: Accenture Institute for Strategic Change

Open Systems Interconnection (OSI) Reference ModelSource: GartnerGroup

Internet Protocol (IP) Value ChainSource: MIT, The Evolution of International Internet Telephony by Terrence McGarty, 2000

Evolution of Companies via the Web

Sun Open Net Environment (Sun ONE) Implementation Matrix

Virtual Enterprise Migration ModelSource: KPMG Consulting

E-Impact will restructure offerings and how they are deliveredE-Impact will transform marketing, selling and customer serviceE-Impact Across Industry SegmentsInvestment by LeadersInformation as a Percent of Total OfferingSource: Gartner GroupE-Impact will restructure the entire industry

Source: International Research Center (http://www.researchedge.com/)Collaborative Technologies for Enterprise Knowledge Work

Source: International Research Center (http://www.researchedge.com/)Knowledge Workers in the Modern Enterprise

High-Performance Customer Relationship Management (CRM)Source: Chordiant Software

eBusiness Infrastructure MapSource: Informatica

Source: Lightwave, September 2001

Source: DCI

Enterprise Information System Architecture

The Growing Complexity of Web Solution InterrelationshipsSource: IDC, 2000

Tools for Enterprise Content ManagementSource: IDC, 2000

Vendors Move Towards Enterprise Content ManagementSource: Forrester Research, November 2001

Connect and CommunicateSource: International Research Center (http://www.researchedge.com/)

Telecommunications Market SegmentationSource: Hilliard Lyons

Source: Light ReadingOptical Network Hierarchy

New Enterprise Network Simplifies Corporate ArchitectureSource: Forrester Research, January 2001

Broadband Features & ApplicationsSource: Jupiter

Content Interactivity and Richness are IncreasingSource: GartnerGroup

Messaging and Downloads Become the Killer AppsSource: CIBC

Telecom Technologies by Market Segment & Connection SpeedSource: McKinsey & CompanyDirectFiber

Content Distribution Network (CDN) BottlenecksSource: Alcatel

Content Management Eases Network BottlenecksSource: CIBC World Markets

Source: Cutter ConsortiumThe Super Peer P2P Architecture

Source: Network World, September 10, 2001

Future of P2P Web Content Delivery - Key Points

Even if P2P CDNs Don't Deliver on All of Their Claims,Their Cost Advantages Will Shift The Marketplace

The Consumer P2P Streaming Market is Hot, But Enterprise Delivery is A Bigger Opportunity Network Service Providers and Telcos are the Ultimate P2P Streaming Channel The Logical Corollary: Hosting Companies Should Consider Partnering With, Investing In or Acquiring Distributed Computing Companies to Offer Their Own Streaming P2P Services "Traditional" Content Delivery Networks Won't Survive The Next Wave of Consolidation And Competition Without An Infrastructure Partner Hybrid "Traditional" Content Delivery Networks with P2P Content Delivery at the Edge Will Begin to Form. Security Issues Raised By P2P Could Remain Critical for at Least the Next 12 Months; Enterprises, However, Need Not Share These Fears P2P CDN Providers Will Need To Own Key Channels Of Their Business P2P CDN Public Offerings Are On The Way P2P Content Delivery Will Find Consumer Acceptance Quietly, But Widely Source: PeerToPeer Central 2002

Twelve New Commandments of TelecomIndustry boundaries will crumble and reform

New types of companies rapidly emerge, stimulating new technologies, but ultimately are absorbed by larger players

Companies not previously thought of as competitors enter the market

Customer segmentation grows in strategic importance

Customer loyalty grows in strategic importance

Prices generally drop, but not for all customer segments

Elaborate new packaging and pricing schemes emerge

Wide geographic scale and product/technology scope emerge as key weapons

Service quality drops as costs are squeezed

Companies struggle to maintain profitability at lower revenue levels

Customer usage of all telecom services increases dramatically

Unit prices fall, on average

from Americas Network May 15, 1996

Source: McKinsey Quarterly, 2001 Forces Leading to Possible Industry Consolidation

Content & MediaDigitalEcosystemSource: Deloitte Consulting

Source: GartnerGroup, November 2001The Home Gateway and Content Convergence

Source: International Research Center (http://www.researchedge.com/)Modern Home Network Example

Source: Home Automation Systems, Inc.Home Networking Applications

Source: eMarketer, Inc. (http://www.emarketer.com/)U.S. Residential Dial-up and Broadband Forecasts (in Millions) Notes: Year 2000 Actuals derived from U.S. DOC & OECD surveys. Other Broadband category includes wireless, satellite, and fiber to the home.

Source: International Research Center (http://www.researchedge.com/)Residential Data Services Comparisons

Newspaper Publishing Magazine Publishing Book PublishingRecorded Music Radio & Out-of-Home Media Filmed Entertainment Television Content: Broadcast & Cable Networks Television Distribution: Station, Cable & DBS Internet Advertising & Access Spending Theme Parks & Amusement Parks SportsSource: PricewaterhouseCoopersEntertainment and Media Industry Segments

Source: PricewaterhouseCoopers

Source: University of Michigan Business School, September 2002

Activities Regularly Performed OnlineSource: Forrester Research 2001 (Note: Corrected Legend) BroadbandNarrowband

Pathfire VOD Digital Media Distribution & ManagementSource: CED Magazine, February 2002

Keys to the Video On Demand (VOD) Business ModelSource: CED Magazine, February 2002

Source: GartnerGroup

Source: The Mobile Constituent/CysiveDiversity of Mobile Computing Devices and Networks

The Hyper-Connected IndividualSource: PricewaterhouseCoopers

Personal Interactive Service Manager (PRISM)Source: PricewaterhouseCoopers (Note: 7 Layers)

Wireless Industry Value ChainSource: Cherry Tree & Co., November 2000

Next-Generation Wireless Services EvolutionSource: The Yankee Group, August 2001

Mobile IP Content Control and DeliverySource: Cisco Systems

Mobile IP Services Architectural OverviewSource: Cisco Systems

Source: The Yankee Group, October 2001 Online Consumers Wireless Web Applications Wish List

U.S. Consumers' Interest in Specific Location-Based Applications Source: Jupiter

Wireless Value Chain for Content SettlementSource: The Yankee Group, August 2001

Source: eAI Journal

Key Enabling Technologies for Mobile Data Growth(Note: Fails to Anticipate 802.11x WLAN as Key Technology - MG)

Comparison of 1G, 2G, 2.5G, and 3G Networks Source: Nokia and 3G Newsroom

Proxim Wireless Public Access Solution SetSource: Proxim

Source: Wired, Illustration by lostinspace Wireless Coverage by WLANs Over a City

Examples ofMobile WirelessInformation AppliancesHandspring TreoMotorola V200

Nokia 9290 CommunicatorSony Clie PEG NR70V

Source: PC MagazineLexus Telematics Example

Source: KMWorld/University of California, Berkeley

Visual Content on the Web is ExplodingSource: eVision

The Future of Search TechnologySource: eVision

One is Glad to Be of Service

That line, taken from "Bicentennial Man," starring Robin Williams, suggests at least one aspect of professional and personal life in the early to middle years of the 21st century. All kinds of devices and appliances, including houses and automobiles, will be able to communicate in order to serve us better. Intelligent, speech-understanding, and synthesis systems will make it easier to interact with computer-based systems by means of voice commands. Free flow of information all around us will be the normal case, as will casual networked interaction by voice, keyboard, mouse, or other three-dimensional means.

Vint Cerf, Senior Vice President, Internet Architecture and Technology, WorldCom, Inc., March 2002

Modern Life is Connected and ComplicatedSource: Hewlett Packard

Personal AssistantsSource: Hewlett Packard

Key Roles of a Personal AssistantKey Requirements for a Personal AssistantSource: Hewlett Packard

Software Agents Facilitated By Semantic ContentSource: Scientific American, The Semantic Web, May 2001

The Congress shall have the Power to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.

The "Copyright Provision" of the United States Constitution, Article I, Section 8, ratified 1788

Source: The Yankee GroupSignificant Dates in U.S. Copyright Law

Potential Copyright Infringement ThreatsUnauthorized distribution or sale of copyrighted content: Content caching - loss of advertising view revenue Illegal host aggregators or trading communities Documents, music, video, graphics/photos, software Plagiarism in whole or part Sampling content beyond Fair Use guidelines Minor alterations and claiming as ones own Deep linking and framing of web pages Dilution of original content valueUnauthorized distribution or sale of consumer goods: Grey market - sold in violation of distribution terms Counterfeit - look and feel of original merchandiseSource: International Research Center, 2002 (http://www.researchedge.com/)

Source: The Yankee GroupMajor Content Licensing Organizations

Digital Rights Management (DRM)DRM is the trusted exchange of digital information over the intranet, extranet or Internet. DRM controls users rights once they have a file. Users are granted only the privileges the media sender allows. A key characteristic of DRM is the persistent protection of this information. Protection does not stop once the user acquires the information, but follows the information throughout its use. DRM can control the type of access granted to the user of the information, protecting the information from being copied, printed or redistributed without permission.

Definition from GartnerGroup, 2000

Secure Content Delivery MethodsProprietary & Confidential Information Expectation of limited distribution/useGuaranteed E-Delivery Secure content hosting & e-mail exchangesPassword Control Access granted to authorized usersRecords Management Track content location Security and retention rulesEncryption Files only accessible with decryption keyDigital Rights Management Trusted exchange with limited use enforcement Limited copying and printing privilegesSteganography & Digital Watermarks Tag for content source or unique ownersSource: International Research Center, 2002 (http://www.researchedge.com/)

No person shall manufacture, import, offer to the public, provide, or otherwise traffic in any technology, product, service, device, component, or part thereof, that is primarily designed or produced for the purpose of circumventing a technological measure that controls access to a (copyrighted) work.

Digital Millennium Copyright Act,

Section 1201, October 1998

Source: GartnerGroup

The growing and dangerous intrusion of this new technology threatens an entire industry's economic vitality and future security. The new technology, is to the American film producer and the American public as the Boston Strangler is to the woman alone.

Jack Valenti, president of the Motion Picture Association of America, 1982, testifying before the House Judiciary Committee on the advent of videocassette recorders

Traditional Movie Performance Revenue CycleSource: GartnerGroup

August 7, 2000

Source: GartnerGroupPossible Music Performance Revenue Cycle

DRM & Content Protection Market EvolutionSource: GartnerGroup

The Content Life CycleSource: GartnerGroup

Source: The Yankee GroupThe Content Life Cycle

Source: Gartner Dataquest, November 2001Contents Convergence Scope

Content Convergence Value ChainSource: Gartner, November 2001

Content Delivery Evolves with e-BusinessE-Commerce applicationsE-Business components and platformsWeb services infrastructureSyndicated servicesStand-alone Web SitesContentCommerceBusinessContentCommerceBusinessStand-alone Web sitese-Commerce applicationse-Business components and platformsWeb and Syndicated ServicesBusiness ValueCaching -- static images, html Streaming -- audio, video Dynamic caching -- customized pages -- data-level cachingDistributed delivery -- applications -- personalizedSource: Aberdeen Group

Functions in the Content Delivery Value ChainAudience ManagementEvent ManagementDigital Rights ManagementBilling and OSSEn/De/Trans- codingDigital Asset ManagementPublishing SolutionsSyndication StorageNetwork/Bandwidth Provisioning and ManagementNetwork-Side CacheServer-Side CacheHosting and ServingAcceleration/ OptimizationSwitching/ RoutingContent DeliveryContent ManagementContentMonetizationSource: Aberdeen Group

Information Engineering (InfoE) Layers ModelSource: Arizona State University (ASU, Note: 7 Layers)

Intranet Content Management Seven Layer ModelSource: Inmagic/McQueen Consulting (Note: 7 Layers)

Content Delivery Value ChainSource: Alcatel

Content Delivery Solution ChainSource: Alcatel (Note: 7 Layers)

http://www.gotoanalysts.com/piperpublic/goto/assets/pdfs/features/streamingmedia.pdfStreaming Media Digital Distribution Cycle

From Reality to Reality ReproductionSource: Divx Networks

Source: The Yankee Group, 2001Streaming Media Value Chain

Reciprocal Digital Clearing Service

Source: IDC & NQL

Market Drivers for the Application Service Provider ModelSource: Cherry Tree & Co., September 2000

IDC xSP - Value Added at Each StepSource: IDC (Note: 7 Layers)

Users Vertical Portals,Web-based Archives& Search EnginesPrint Publishers, Electronic Publishers & Content Creators Established AggregatorsDocumentDeliverySyndicators & Infomediaries Information Centers Market Intelligence Training & LearningWeb Site Mgrs. Academic & Public Libraries Indexers, Abstractors, Secondary PublishersEmployee Portals Extranets Open Web Sites Intranets Corporate Portals Learning PortalsSource: Outsell Inc.The Current State of the Content Industry

Syndicators Concentrate on Service More Than Product or AudienceSource: Forrester Research

Managing Content as KnowledgeSource: GartnerGroup

New Media Aspects of BusinessSource: GartnerGroup

Source: Gartner Research, July 2001 (Note: * Estimations for OECD Nations) Assessment of Emerging Business Technologies & Trends(Note: Mark Goldstein/IRC predictsEnterprise Instant Messagingwill have most impact by 2010)

Source: Gartner Group, June 2002Emerging Technologies Hype Cycle

Pervasive Content Value ChainSource: The Yankee Group

Content Technologies Hype CycleSource: GartnerGroup

ConsumeDistributeAggregate/ManageCreateSimplified Content Value Chain ModelCreation ToolsAuthor/CreateEdit/EnhanceComponentsObjectsModulesMetadataAssembleTransformPackageLicense/SellLicense/AcquireSyndicate/SellCatalog/TagMetadata/ObjectsRetrieve/RightsOrganize/StoreDynamic PrepLocalizePersonalizeTransformPackage/DeliverTransactionsSchedule, SequenceSecure, EncapsulateTunnel/VPNAccess ControlAuthenticationRights ManagementWeb HostingCDN/StorageManaged ServicesTransport, PeeringOSS, SettlementLast Mile DeliverySecure, FilterPersonalize, PrepareInsertions/AddsHome NetworkLocal CachingPayments ($)Presentation LayerNavigate, InteractDownload, ShareFeedback, TrackMetrics, AdjustSource: International Research Center, 2002 (http://www.researchedge.com/)

A powerful global conversation has begun. Through the Internet, people are discovering and inventing new ways to share relevant knowledge with blinding speed. As a direct result, markets are getting smarter, and getting smarter faster than most companies. The Cluetrain Manifesto (http://www.cluetrain.com/)

Photons have neither morals or visas.

David J. Farber, 1996, Former FCC Chief Technologist (http://www.cis.upenn.edu/~farber/)

Electric circuitry has overthrown the regime of "time" and "space" and pours upon us instantly and continuously the concerns of all other men. We now live in a global village. Marshall McLuhan, 1967 (http://www.beaulieuhome.com/McLuhan/)

The Sedona Conference Dublin

The Creative Process: Demystifying Digital Media

(http://www.digitalmediaintelligence.com/sedona.html)

The Secret Life of Content and

The Digital Media Value Chain

Ireland Data Points & Stats

2002 - International Research Center

CNRI Map of Dublin 802.11x WiFi Public Hotspots

Harvard Global Info Tech Report - United States

Harvard Global Info Tech Report - United States

Harvard Global Info Tech Report - Ireland

Harvard Global Info Tech Report - Ireland