05/05/2013 Looking for Business Models in Digital Media and Content Industries Dynamics of the Media and Content Industry International Conference European Forum for Science and Industry Media and Content Brussels 25‐26 October 2012 Claudio Feijóo Source: indigo‐moogle.deviantart.com Contact: cfeijoo@cedint.upm.es CeDInt – UPM, Campus de Montegancedo, Pozuelo de Alarcón, 28223 Madrid, Spain Access the presentation at: http://upm‐es.academia.edu/ClaudioFeijoo THE VIDEOGAMES REPORT 2 Are games important for the EU economy?  The EU benefits from a rich milieu of developers and an important population of middleware producers and distributors  The EU is strong on telecom services especially mobile  The EU is seen as a "hotbed" for games development overall  A numerous population of highly creative small development studios  National markets are still unevenly developed  Games as a testbed for digital innovations, marketing, advanced services Mobile Media Ecosystem 1 05/05/2013 3 IS THERE LIFE BEYOND ADVERTISING AS A BUSINESS MODEL? (… and personal information as a currency to pay for apparently free lunch) Source: The “Usability‐Stickiness” Model for App Business Models—Ilja Laurs, CEO of GetJar (2011) Media and Content 4 MYTHS AND TRUTHS ABOUT THE APPS ECONOMY Apple, Google and the rise of the platforms The number of apps available for download in the Apple platform has grown from 500 to 500,000 in three years (2008‐2011) Source: Apple (2011)  App stores have changed the value chain of software (distribution and pricing), and might do the same with the industries of games, books, …  It is not about apps but platforms. How to control a platform?  Cross‐platforms and cross‐media  Mobile platforms as multi‐sided markets … videoconsoles as two‐sided market paradigm  Top of the Pops: average per‐app revenue is $1,200 to $3,900, an app has 35% chance of generating only between $1 and $500, more than 75% of developers cannot rely on app development as their sole source of revenue (Vision Mobile, 2012), small multidisciplinary studios, fragmented.  EU: companies are rather well represented among the top developer companies worldwide, large population of highly creative small development studios (clusters) is observed mainly in the UK, France, Germany, the Nordic countries and to a lesser extent in Spain. Mobile Media Ecosystem 2 05/05/2013 5 COMPETING AND COLLABORATING BUSINESS MODELS IN THE ECOSYSTEM From advertisers, content producers and telecomm operators to device manufacturers Mobile data plans Apps Social networking Games In‐game items 2012E (B$) Growth y‐y (%) 9,5 76 83 20(2) 26(1) 31 15 18 16 ‐ 8 ‐ 18 2.1 2.5 Music ‐ 16 ‐ Video 2.9(4) 3.6(3) 24 Total advertisers spending 6.3 11.6 85 TOTAL 128 150 17 220(5) 235 7 Mobile handsets (1) (2) (3) (4) (5) 2011 (B$) 32 billion apps downloaded in 2012 23 billion apps downloaded in 2011 280 billion videos watched on mobile devices in 2012 108 billion videos watched on mobile devices in 2011 1,7 billion mobile handsets shipments in 2011 Source: adapted by the author from industry data (Gartner, IDC, Informa Telecoms and Mecia, Interactive Advertising Bureau, IPTS, Juniper Research, NPD, Strategy Analytics, PwC) Market segment Mobile Media Ecosystem 3