PRESIDENT AND CEO
2013 will be remembered as the year that everything came together.
Since the dawn of the current Device Age, media consumption has been headed to a Manifest Destiny that experts have called “Convergence”: a new reality in which consumers can access any type of media they want, anywhere they want, through a spectrum of interconnected devices.
Forrester’s year-end report confirms we are on the precipice of that moment. 50% of cell phone owners now have smartphones—rich media can be delivered to them everywhere through high-speed LTE and proliferating WiFi availability.
From a device perspective, we are at the apogee of a significant evolution. The iPhone 5 represents a kind of Platonic Form that all other smartphones will coalesce around. There will be incremental improvements in memory, speed, weight, and camera technology, but the essential look, feel, and most importantly usage for media consumption has reached a plateau that media producers can rely on to be the standard for some years to come. Tablets are being massively adopted—Forrester notes they’ve doubled to almost 20% penetration in 2012. Amazon’s value-priced Kindle tablet is helping to fuel the post-PC shift by bundling access to hours of free media content with Amazon Prime service. And at some point this year (we know this because of the recent leaks to the Wall Street Journal) we will have the full Apple TV experience.
For consumers, Convergence means access to a media feast unlike anything previously imaginable—in breadth, depth, and richness, with information and entertainment from books to music to visual arts to film/TV to games.
But what does this mean for media companies, and in particular book publishers?
- Greater, smarter interactivity: Interconnected devices and software technologies like HTML5 will increasingly enable experiences beyond the “DVD extra” model of added image, audio, or video content. We’ll see new combinations of previously separate “ebook” and “app”-type experiences including 2-screen synchronized audio/video, geolocation, and social communications that will be “baked in” rather than “layered on” to the reading experience for fiction and nonfiction.
- More partnership opportunities: Technology companies across the hardware/software spectrum have come to realize that great content is the Final Frontier of differentiation, and book publishers have this in spades. The great stories, authoritative information, classic and contemporary brands that you’ve built and nourished over decades are uniquely valuable, and new partners will come knocking in 2013.
- New business models: One-time content-for-cash transactions will be increasingly less of what publishing is about in the 21st century. Creating ongoing relationships between consumers and content libraries, with incremental value-adds for incremental cost, and innovative advertising/merchandising partnerships, will be more and more common.
- More intense competition: The resources necessary to enable these new interactivity, partnerships, and business models will be considerable. Amazon’s recently launched publishing arm and the announced consolidations among what had been the Big 6 are only the beginning. Outside players including private equity and technology companies will become a greater part of the landscape, creating both threats and opportunities.