M+E Daily

Media and entertainment (M&E) companies need to make “bold” moves today to better compete, drive growth and succeed in the future, according to Robert Brown, associate VP at Cognizant’s Center for the Future of Work.

As the M&E industry reaches the end of the first phase of its digital journey, it has arrived at a critical inflection point, according to Cognizant. Despite achieving early leadership in digitizing products, services and customer experiences, the M&E industry mustn’t stop there because, for the next few years, the frontline of becoming fully digital businesses will reside within middle- and back-office operations, according to Brown. While some traditional M&E companies are already onto the next critical phase of their digital journey, one that requires them to embrace digital as a tool for transforming their end-to-end operations and business models, the M&E sector still has a lot of work to do, he said.

“It takes a very bold CEO to state in front of shareholders that legacy is poison and we’re going to write off all of this captive investment that we’ve got,” he said during the morning technology breakout presentation “The Second Half of the Chessboard: the Future Work Ahead for M&E Digital Transformation” at the Oct. 4 Hollywood Innovation & Technology Summit (HITS) Fall event.

“But make no mistake: The longer that companies wait to do that,” the harder it will be, according to Brown. “It’s like dragging a boat anchor” and akin to “paying a laggard penalty to make that shift,” he said, warning: “You either do it now or you’ve got to do it later…. The funny thing about the future of work [is] it’s always in the future, but it starts tomorrow.”

Everybody attending the session — whether they worked for a film studio, a gaming company or a TV network — must be able to “connect old processes to new technologies,” and we are seeing that such “competitive moves are happening everywhere” in the industry, he said.

As one example, he said: “It is incredible now to think that the old Gray Lady, The New York Times herself, is now pulling in half of its revenues, estimated to be about $500 million, through the paywall…. This is an area where data wants to be free and heaven help anybody that gets in the way of monetizing that.”

As another example, he pointed to Netflix dropping a trailer for the movie The Cloverfield Paradox, with “with no warning,” during the 2018 Super Bowl and receiving “rapturous receptions from fans.” He called that “emblematic of what a lot of the people on the main stage were talking about this morning,” adding that something like that “absolutely disrupts the business processes” of a company.

He also pointed as an example to U.K. publisher Archant launching The New European magazine “within 10 days following the Brexit vote,” adding: 
“The speed with which these things are happening is absolutely incredible.”
Brown went on to cite the findings of research based on feedback from 350 senior M&E industry executives.

“I’m going to call this a tale of shock and D’oh! to channel my inner Homer Simpson,” he told attendees, noting it was “shocking” because “more than 95 percent of media and entertainment companies would not characterize themselves as being digital leaders – this in the year 2018,” based on that research.

In stark contrast, he said, only 3% of the 350 executives that Cognizant interviewed thought they’re digital leaders. That’s despite the fact that, based on “everything that we’ve already heard today, and you guys see this in your business every day, being a digital leader is going to be critical.”

On the other hand, it was “good news” that 45% of the executives interviewed said they were digitally “maturing.” But he said: “There is almost a digital delusion at play, which is, by 2022, 47 percent – almost half of them – think that, ‘Yeah, we’re going to be able to catapult ourselves,’ through magic and pixie dust, ‘to become true, digital leaders.’ And so that is a rather shocking admission that does need urgent action.”

Also interesting from the research was the spending profile, he went on to say, noting there was a “50 percent expected increase in spending on new technology over the next five years.” He predicted, therefore, that money is “going to be a big lever that drives this.”

Turning to specifically where spending was occurring at M&E companies, he said: “The future of work and the future of business strategy runs right through mobility technology. Wearables are a part of the equation.” Artificial intelligence (AI) “for sure” as well, he said. But “sort of a bit of an unknown at this point” were the spending plans for blockchain, augmented reality (AR) and virtual reality (VR), he said. The impact from spending on AR and VR were about the same as wearables and AI today, “but the 2020 impact remains to be seen,” he said, adding: “I think that’s a longer-term play.”

Talent, meanwhile, “is not going away,” he said. But the big question now is “how do you stop the bleed” that’s being seen as talented employees flee from companies to work for often larger rivals, he said. He pointed to one example in the advertising space in which he said the firm WPP “lost more than 2,000 employees” to rivals and “there’s relatively few flowing back the other way.”

A key question that successful M&E companies’ executives must ask is how do they become “digital sprinters,” he said, explaining: “The sprinters are staying ahead of the pack by investing in their process. That may seem like kind of an unsexy pursuit. But unlocking the potential in the middle- and back-office processes to get closer to the customer is absolutely an unavoidable route for businesses in this industry.”

Also important is that “ethics and self-control…. be hard-coded” into each organization, he said, predicting: “The absence of trust is going to lead to anti-trust” moves by the government to reign media companies in.

One company that seems to be making the right moves is Disney, he said, telling attendees that company is “sort of engineering a foundation for multigenerational, cradle-to-grave relationships, and — in an era where trust is feeling a little bit more evanescent with each passing day — Disney has cultivated a sense of a family-friendly trusted brand.”

If Disney were to diversify into new areas for it, such as health and wellness, or other sectors we haven’t even thought of yet, “that’s where the future of work from a strategy perspective starts to get very interesting,” he also said.

He also turned to the growing presence of new jobs in the M&E space. “Fifteen years ago, who could have imagined the following help wanted ad” – one for Twitter Data Wrangler, he said, noting that job didn’t exist 15 years ago. But that kind of job – basically the social media manager – has become a significant job now, he said.

AR Journey Builder is “just one example of 21 jobs of the future” identified by Cognizant that, he said, “will sort of be experience conductors” and be “essential” for building out the new “experience economy” he predicted the current entertainment sector will transform into.

“We’re going to be releasing 21 more jobs of the future in three weeks and also releasing the Cognizant Jobs of the Future Index…so we can actually track how this stuff is manifesting and coming to pass over time,” he also disclosed.

Another factor that stands to significantly continue changing the nature of jobs in the M&E sector in the future is the growing number of employees who are able to work remotely, from home or elsewhere, he predicted, adding the gig economy is also starting to really “take off.”

HITS Fall was sponsored by Amazon Web Services, Microsoft Azure, Box, Ooyala, TiVo, Cognizant, DXC Technology, Gracenote, LiveTiles, ThinkAnalytics, Wasabi, Aspera, EIDR, MicroStrategy, the Trusted Partner Network, human-I-T, Zaszou IT Consulting, OnPrem Solution Partners, and Bob Gold & Associates, and was produced by the Media & Entertainment Services Alliance (MESA), in association with the Content Delivery & Security Association (CDSA), the Hollywood IT Society (HITS), the Smart Content Council and Women in Technology Hollywood (WiTH).