Monday's International Herald Tribune had a fascinating article with views from several directions on convergence in the media space. The IHT quoted EA (Entertainment Arts the video gaming giant), Star the Asian satellite broadcaster, and SK Telecom Korea's biggest mobile telecoms operator. Here are a few tidbits from the story:
Entertainment Arts Executive Vice President Gerhard Florin says that videogaming differs from other media in that when gamers interact with a videogame, they do it with full attention. That is not true of most other mass media - when we have the TV on, we might be reading a newspaper or while reading a magazine we may have the radio playing in the background etc. For those thinking gaming is a teenager phenomenon, check out this stat. In the past ten years, the average age of the gamer has shot up from 17 in 1995 to 25 in 2005. That is the average age, so it means there are plenty of us 40-somethings also into gaming ha-ha, and most tellingly, the average age of the gamer is still rising. And relevant to convergence? EA says that the future of gaming involves mobile phones, as the mobile phone allows micropayment elements to be built into the gaming experience (as we discuss in our book Communities Dominate Brands, in the case study of the Habbo Hotel). EA expects something in the magnitude of 40% of revenues in gaming coming in the future from mobile phones. Fascinating?
Meanwhile Star the Asian satellite broadcaster, talked about its recent experience in India. In August they included SMS text messaging to the Who Wants to be a Millionaire show. In less than six months they received... (...drum-roll...) ...100 MILLION text messages. Wow. And obviously Star shares in a portion out of the premium cost of those messages, what a nice revenue stream. CEO of the Star Group, Michelle Guthrie was quoted saying that they see already 5% of their total revenue in many of their markets coming from "non-advertising, non-subscription" sources. That is premium SMS text messaging, folks, and it was a flat zero only two years earlier. Looks like they have bought into the SMS-to-TV model, much like our case study in our book on SMS-to-TV chat ha-ha..
And a third element in this convergence? South Korean mobile operator giant, SK Telecom was also quoted in the same story. Rick Kim, the global head of the SK Communications Internet Service Provider arm of SK Telecom, shot this warning to all traditional media: "Mobile phone companies like us will increasingly enter the media space as we see the need to add value to attract customers. When everyone has a mobile phone, you need to look for new ways to get revenue." A significant warning from the leading mobile operator in the country with the highest penetration of broadband internet, and the highest migration of mobile phones from current 2G standards to next generation 3G phones.
And yes, again we did discuss the Korean impacts to media in our book, with our case study of Oh My News. And this blogsite has shown continuously further glimpses into the Korean market. I would particularly suggest now paying attention to CyWorld, which is like Habbo Hotel turbocharged...
Convergence is obviously happening, nobody would doubt that. The beauty of it is, that today there is so much of a new opportunity, that convergence can give numerous opportunities to create new innovative service propositions to existing customers. That of course needs innovation and creativity. Alan and I will keep on monitoring what we find around the world as we run our workshops on these topics, and we will keep on posting them here. So do come back and please feel free to share these thoughts - and links to these stories - with your colleagues.
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