For more than twenty years I have been involved in debates about whether ‘content is king’.
While I have never disputed the importance of content, I have consistently argued that without access the value of content is questionable.
However, in many countries the access issue has finally been solved; cheap, good quality broadband has become, or is rapidly becoming, available.
So, yes, we can now safely refer to content as being ‘king’. However it must not just be content – it must be highly specialised, good quality and unique content.
While nobody would try to view the millions of clips on YouTube, by now most broadband users will have looked, at least once or twice, at a ‘unique’ clip on the site.
And this is only the beginning of the content revolution. Yes, I am certainly talking about revolution here, not evolution. This development will go faster than most people expect.
There is no way that the current commercial content providers will be able to cope with this revolution. They all date back to a time when the use of video content was limited and lots of money was spent on the production of content, which took the form of advertising material, corporate video, docos and movies.
It is impossible for most content providers to change their business models. They face the same problems as everybody else involved in digital media, that of cannibalising old business models.
Enter the world of the new professional digital media entrepreneurs …….
They now offering you broadcast quality TV spots for as little as €25. Many of these new companies operate from the former Eastern Europe, in countries such as Poland and the Czech Republic. Some of you might recall a travel report I wrote on the incredibly innovative Czech content market. Look at many of the cartoons and you will find Czech names in the credits.
The business models are varied. They are using software programs that allow customers to design their own adverting spots (the €25 option). They also operate fully-equipped video studies where they are still able to produce professional commercial material for less than 80% of what is being charged by the traditional producers.
One of these entrepreneurs is Europe Marketing Group (EMG) operating from an industrial site in Warsaw. With good broadband connections they can communicate with their (mainly West European) customers, and productions fly from east to west at the speed of light – no need to operate from expensive locations in London or Frankfurt.
Interestingly, their key markets so far have been their own home markets. Businesses in these new emerging economies simply didn’t have the money to spend on content productions for advertising like their counterparts in the west of the continent.
Necessity is certainly the mother of invention.
Also, not unimportantly, labour is still significantly cheaper in Eastern Europe, especially for those operating in the film industry.
EMG’s next growth market is the production of Internet TV. With digital TV now becoming available across the world there are more channels to fill with content, and the company wants to play a key role in producing for this market as well.
Netherlands-based spotzer.nl is using cheap production facilities in Romania, Ukraine and Uruguay, with the same result – costs can be 80%-90% lower than those charged by the traditional advertising and film production studios. Via the Net, freelance producers from around the world can easily participate in these new alternative content-producing networks.
The companies advertising in the Yellow pages constitute a key market for these low cost production products. They are aware of the positive impact advertising has on their business, but so far they have been unable to participate in video-based advertising.
This is now changing and the SME market is more than keen to spend its money on low cost, good quality spots. Using the Internet and new digital TV channels, instead of the traditional media, to advertise they either place these spots on their own website or use high traffic sites that are relevant to their business.
In the meantime Spotzer has opened offices in London and Los Angeles. Another effect of the availability of low cost, high quality broadband is that countries that have this in place are now exporting their innovations and services around the world.
Another interesting site I came across when looking at these developments was tv4B.nl, a YouTube-like site, specifically aimed at SMEs. The use of advertising companies and broadcasting in general has been too expensive for most SMEs in the past, but these new Internet-based activities are going to solve that problem.
For detailed information, seereport:- Europe (Eastern) Telecoms, Mobile & Broadband Overview and Analysis 2006-2007.