1. Digital Media 101 Drivers & Frameworks: How We Got Here and Where We are Going 1 Dr. Gigi Johnson, Executive Director, Maremel Institute Education Programs in Media and Cultural Change @maremel

2. Computers as a retail consumer product seemed humorous in 1965 Cartoon, Gordon Moore article Electronics, Volume 38, Number 8, April 19, 1965. 2

3. 2 Forces Geometrically Changed How We Connect Dramatic increase and diffusion of data, storage, and computer processing power into the system and into homes and cell phones Dramatic decrease in the cost of “distance” (Cairncross, 1997) from both deregulation and technology creating infrastructure and reduced per minute or per connection cost 3

4. Moore’s Law continues to drop cost and increase speed of computing Source: Deloitte’s Center for the Edge Source: Intel.com 1965: prediction that the number of transistors on a chip will double about every two years 4

5. Kuyper’s Law: Storage Cost Continues to Plummet Source: Deloitte’s Center for the EdgeDeloitte’s Center for the Edge 5

6. Bandwidth Continues to Decline in Cost, Increase in Speed and Capacity Source: Deloitte’s Center for the Edge 6

7. Internet is Reaching the Last Third of U.S. users, Mostly Over 65 Sources: Deloitte Center for the Edge, Pew 7

8. US Mobile Has Reached Saturation; Internet/4G to Keep Growing 8

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10. Technology: Changing Rules ExpectationsFunds ContentTime 10

11. 4 costs have transformed content creation, transport, and playback Cost of digital distribution and inventory Costs of transit and storage Costs of creation and tools Costs (and rewards) have increased to integrate, e.g., Google, Facebook, Vevo, YouTube, Twitter, etc. 11

12. Resulting Power Shifters and New Limits o Extensive computing power in the home and inexpensive storage -- heading to Cloud Computing o In most countries, broadband in expansion or late adopter stage o Battery/power being “solved” o Compression (continuing) to be “solved” o Heat (heat?)/energy use o Tools for inexpensive creation 12

13. Media technologies connect “Where” and “When” Time of Consumption Place of Consumption Metaphors/rules of consumption Time of Capture Place of Capture Rules of Capture/Editing/ Context Time Space Connections 13

14. ExamplesLocation Time Shifting Multiple Uses Multiple Media Concerts, theater, sporting events 1 – live venue – out of home None1Initially, none Movies in theater1 – shifted – out of home Yes – venue’s choice 1 for user; multiple for theater None RecordsMany – moveable Yes – user’s choice ManyNone (45 vs LP) Television1 – shifted – in home Yes – channel’s choice 1 for user; multiple by contract for station None Radio1 – shifted – in home Yes – channel’s choice 11 Progressive Media Have Re-sliced Time and Place for Consumers 14

15. Time and Place Shifted to the Home and Onward 15

16. ExamplesLocation Time Shifting Multiple Uses Multiple Media Rental, Home Video (1984 Betamax ruling) 1 – shifted, in- home Yes No CD; cassettes; DVD; books, newspapers Many – shifted – users’ choice Yes Not until recently DVRs (digital video recorders, like TiVo) Where the device is Yes Progressively (e.g., Slingbox) Digital files – mp3, epub, jpg, html, avi, mpeg2, mpeg4, etc. ManyYes Yes – crashed into time- and place-based contracts New Media Cracked Open Time and Place Permanently …so will we ever need to purchase another copy of a library media? DATA is now the driver. 16

17. Digital Connection Drivers are Reconnecting Time and Place with Data Technologies of Connection Metadata to the frame Recording relationship with user Recording relationship with distribution Influencing relationships with filter and relationship with other media objects Allowing connection with other media objects 17

18. Time: Sliced and Diced with Data Data now measures and guides connection between consumer use and advertiser measurement of time 18

19. Data Driving New Business Models Licensing and new syndications Razor/blade – cross-subsidy Paying for virtual goods or relationship Versioning/”Freemium” (free or inexpensive versions to promote and for various media) Selling data and behavior (like advertising) New “Windows” – new slicing economic rent by timeframe and technology limits “Library” – selling different time/place values for paid-for content 19

20. Abundant Creation Creative Community New Filters + New Abundance Drive New Creative Industry Structures Variable Inputs + Uncertain Outputs = Excess Production and Capacity Source: Caves, Creative Industries, 2000 20

21. Gartner’s Hype Cycles: New Models Push in with Inflated Expectations 21

22. Gartner Hype Positions Shifted: 2009-2011 Editions 22

23. New Powers: Alliances, Keystones, and New Aggregators 23

24. Interwoven Networks of Influence are Changing 24

25. Bulk of Internet Users: Asia and Europe 25

26. Global Shifts to Connected Participation 26 Source: Universal McCann Wave4 7/09

27. Citizen journalism unleashed whole new realms of participation, politics, and recommendations 27

28. Wireless: 3G projected to strongly penetrate before 2016, behind Europe and Japan 28

29. Expanding our External Brains: New Expectations 29

30. Consumer decision points are changing to “right now” 30... and instant data is now available for that decision influencing moment

31. Techmeme: Social graph vs. Interest graph – The Age of RelevanceThe Age of Relevance 31 Shifting Powers: Information, Recommendation, and/or Relevance

32. Data Recrafts Assumptions Around Territory and Contracts Local: Collecting local audiences for local advertising, local media content, and geo-contracted structures of national content and ads…. Search-based local advertising: restructuring hyperlocal market…release of mechanical “need” for local content distribution over time (including education? Newspapers?) New business combinations? Local creation? Local social tools/conversations? 32

33. Data "Flow": Newer Need for two-way Infrastructures 2-way information on music, books, digital publishing, connected media Distribution to dozens or hundreds of distribution points in different formats Need to realign internal company processes – reinvent the pipes of the corporation – to maximize these assets –Not just digital workflow – digital decision-making 33

34. Music as a Small-File Canary: What Happened? 34 Source: RIAA figures; Digital Music News http://infographicchart.posterous.com/chart-the-real-death-of-the-music-industry

35. Digital Now: Singles On Demand Changing Tides of US Music Sales 35 Source: RIAA figures; Digital Music News http://infographicchart.posterous.com/chart-the-real-death-of-the-music-industry

36. New Ecosystems Building to Integrate with Re-Aggregators New tools for artists to connect through the reaggregators (e.g., Root Music) New data tools for “filters” to understand the market (e.g., Next Big Sound) New relationship- driven content exchange marketplaces (e.g., Spotify, MOG, Cloudsound) New influencers (individuals, specialty reviewers)

37. Advertisers: Catching and Driving Change 37 Source: Blackstone

38. TV: Tipping into Data, Relational, and Social? Source: Silicon Valley Insider

39. Shifting Viewing Trends 39

40. TV: What and Where? Source: XBox

41. Dr. Gigi Johnson, Executive Director Maremel Institute Education Programs in Media and Cultural Change @maremel 626-603-2420 www.maremel.com