M&E Journal: Digital Disruption is Underway

By Jennifer Cooper, Global Head, Media Industry Strategy, Microsoft

It doesn’t take a trained eye to recognize that the M&E industry is rapidly undergoing digital disruption. Compared to audiences 10 years ago, today’s consumers have access to unlimited amounts of content and are consuming it on an increasingly diverse range of technologies and platforms.

In this media-saturated environment, audiences demand content experiences that are enriching and convenient, and consumption patterns are changing in response. In the last 10 years alone, video streaming subscription rates in the U.S. have increased by approximately 450 percent, and this isn’t the only dramatic shift.

Millennials now spend almost 15 percent of the time they devote to movies and television watching on smartphones. As a result, M&E leaders face increasing pressure to find new ways to monetize content and generate revenue.

Transformation is an imperative

Companies that rely on traditional business models are now facing a new reality as their business declines, and leaders don’t have much time to act. In the U.S., for example, 27 percent of consumers without a paid television subscription indicate they cancelled it within the last year.

To remain profitable in this shifting environment, companies must develop monetization strategies that rapidly deliver content to global audiences, attract and engage paying customers, and provide differentiated services to retain advertisers. Monetization is a complex challenge that doesn’t have a single solution, but digital transformation is the clear imperative. Achieving these goals requires agility, flexibility and scalability that only cloud technology can deliver.

Creating content efficiently with cloud infrastructure

Before content can be monetized, it must be created, and generating compelling content remains critical. In 2017, 54 percent of streaming service subscribers indicated they signed up specifically to access original content. There is also increasing pressure to accelerate speed-to-market. In the U.S. and the U.K., more than 62 percent of consumers now think shows should be available on demand within just a few hours of being aired.

To keep audiences satisfied, leaders are looking to cloudify, leveraging the power of intelligent cloud infrastructure to drive both production quality and efficiency. By developing cloud-based workflows using tools like Azure Cosmos DB, Azure Logic Apps and Azure Functions, leading companies like the Endemol Shine Group are facilitating collaboration between globally distributed production teams while keeping valuable intellectual property safe.

Production teams once spent hours manually reviewing, editing, transcribing and analyzing footage on siloed systems. Today’s leaders can take advantage of the automation offered by artificial intelligence, empowering teams to devote more time to collaborating and developing content that resonates with viewers. Finally, when it’s time to deliver content to consumers, distribution tools like Azure Media Services make it easy to create an engaging mobile experience and ensure only authorized users access content.

This process of cloudification not only saves time and decreases costs, but it also lays the groundwork for more effective audience engagement.

Driving deeper engagement with artificial intelligence

To retain paying customers in today’s content- saturated world, M&E companies must move beyond recommendations to develop personalized experiences that keep viewers engaged, and this is no easy task. In the U.S. and the U.K., 62 percent of viewers will switch providers or channels if they aren’t able to find content that interests them. While many content platforms try to address this issue by providing recommendations, consumers aren’t satisfied. Only 16 percent of consumers in the U.S. and U.K. say the content recommendations they receive are consistently very good.

Creating the immersive experiences today’s audiences demand all starts with metadata— the rich data generated from in-depth content analysis. Artificial intelligence tools like Azure Video Indexer empower production teams to rapidly tag content automatically based on spoken words, faces, characters and emotions.

By using machine learning to analyze this metadata along with content performance and customer behavior, leaders like Complex Networks are transforming the viewing experience to personalize it in near real time. Where teams previously relied on supervised learning tools that required time-consuming manual workflows, today’s leaders use advanced machine learning engines like the Azure Custom Decision Service to continuously test new content experiences and select those that resonate most with viewers.

This data-driven approach to building personalized content experiences goes beyond audience retention and churn rates — it also enables companies to deliver new value for advertisers.

Increasing ad effectiveness with audience analytics

While M&E companies are feeling the increasing pressure of meeting customer demands, advertisers find themselves experiencing similar challenges. As capturing consumer time and attention becomes more difficult, they are turning to M&E companies to help solve the problem.

To deliver the results advertisers seek, the right advertisements need to be matched with the right content and the right consumers. Pleasing both advertisers and customers at the same time, however, is a balancing act. More than 55 percent of consumers indicate that even relevant advertisements take away from the viewing experience.

To deliver for both groups, business leaders must use data to improve advertising efficiency.

To attract advertisers without losing subscribers, companies should optimize their advertisement strategies using artificial intelligence and audience analytics. By using tools like Azure AI to identify viewer attributes and analyze browsing history, leaders can develop more accurate audience segments and hone individual preferences.

When paired with metadata generated by production tools like Azure Video Indexer, these insights empower companies to pair viewers, content, and products with increased accuracy to keep the advertising revenue flowing.

Partner with a world-class technology leader

While technology alone won’t solve the monetization challenges today’s business leaders face, cloud infrastructure and artificial intelligence arm them with the agility and the flexibility they need to explore new business strategies with confidence.

As a leading technology provider, Microsoft is a trusted partner for M&E companies on the road to digital transformation.


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