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This article was originally published in the #IABM journal (pp. 42-43) in a feature on "Changing Media Economics".
A rapidly changing media industry
There is no doubt media convergence is happening. Audiences for linear television and media are decreasing slowly, and we expect a collapse in the near future as audiences shift rapidly from traditional to connected media. Using radio as an example, in the UK recent data from RAJAR (Radio Joint Audience Research) shows a dramatic 40% drop in listening hours by 14-19 year olds. It is a trend mirrored in linear media across the board, and that shift has consequences for revenue. Ad spend is moving online, away from traditional channels. The latest report from Insider Intelligence, Worldwide Digital Ad Spending 2021, predicts that digital ad spend will reach $455.30 billion this year, following a 15.7% contraction in traditional ad spending in 2020.
As revenues and audiences shift, media groups merge to benefit from economies of scale. This leads to increased media concentration and rationalisation. The borders between different platforms are slowly fading and media brands will have to ask how they will face this convergence by reinventing themselves instead of attempting to extract a little bit more from their existing model until it breaks.
Greater competition
Accessibility of technology is another driver of transformation. Where media brands used to have the best technology, nowadays everyone has access to similar technology at a fraction of the cost. The barrier to produce and distribute content is gone and everyone is able to reach large audiences. As a result, competition has exploded and new content is sent into the world every second of the day.
Currently, media groups are trying to face the disruption by focusing on lowering costs, but they are not doing so in a joined-up way. They are making incremental changes instead of systemic ones, such as downsizing technical teams. Eventually, stretching production resources to their limits has an impact on the core of media brands: the quality and amount of their content production. This cost-cutting eventually leads to value erosion and damage to brand reputation.
Future proof media brands
The transformation is not yet over and no one knows where it will end. It's also unclear what business model will become dominant in this new reality.
However, two things are clear:
First of all, media brands will have to get closer to their audiences - that means faster throughput of the production, faster feedback loops and interaction with the audience, and the need to extend their reach over more platforms.
Live production will remain one of the greatest skills and differentiators for media brands in the future especially as they continue to recover and rebuild following the impact on live events of the covid pandemic. It is more difficult to produce, but offers great advantages:
Live production creates direct engagement and interaction with the public.
Live production saves time.
Live production creates an ambience and a "brand voice" that can differentiate media brands from their competitors.
Secondly, automation and robust workflows will allow media brands to focus efforts where they are needed: in building audiences and getting noticed - not in production. Quality and speed will be essential, but will not be enough to build a brand. The struggle is not simply to get content on different platforms, but to get noticed and to engage the audience, and to create continued engagement, thereby instilling brand loyalty. Furthermore, there is a need to produce more content at a faster rate, which can be published on different platforms without compromising on quality.
Media production: unplug or else
Media brands need to be prepared for anything. That means investing in a fixed and robust virtual backbone that gives production teams maximal flexibility. In other words: go digital and adopt "as-a-service" ways of working rather than investing in on-premise hardware. Without that adaptation, media brands are tied to solutions and technology that cannot be adapted to a fast-changing environment. As a result, production teams will not be tied to places and processes, which allows them to react in real-time to every new reality the future will bring. Of course, physical control surfaces will remain, but the intelligence and processing will be virtualised and distributed.
This new paradigm forces media brands to compensate for the downsizing of teams by introducing automation wherever possible. This reinvention needs to be natively digital rather than a replication of analogue processes (Digitalise v. Digitise).
The main focus of using software is that the production achieves quality requirements regardless of what media brands do with the production result or on which channel they put it. The right software requires nearly no training, is painless to adopt and is the solution technicians need in the era of the smartphone. It will no longer be necessary to invest in hardware that is provisioned to handle peak needs (CAPEX) since software can scale up and down as needed. This results in cost savings and a cost structure that grows and shrink with the activity.
There is no doubt that the future of content production will be unplugged. That is why On-Hertz adapt their business models to match the requirements of media brands: not only offer traditional fixed one-off licenses, but also SaaS and on-demand. That will ensure the budget remains predictable and in-control, but also offer the flexibility and scalability that is required.
About On-Hertz
Audio production unplugged
On-Hertz brings media brands closer to their audience. We allow creators to go from idea to high-quality content faster, live or pre-recorded, from niche shows to those with millions of fans.
On-Hertz audio-first software suite empowers you to break free from the limitations of legacy hardware environments. We build solutions and apps that are easy to adopt, a breeze to use, and offer full control over your production.
On-Hertz is where the digital transformation of your media brand starts.
Grow your audience by tapping the potential of live content
Produce more content at superior quality
Simplify and speed up your production process
Faster, better, wider: the evolution your media brand needs.