Linear TV to remain strong over catch-up TV content in 2010
Up to 90pc of TV content and 80pc of radio content will still be accessed in traditional linear fashion in 2010. It is also predicted 2010 will see the newspaper industry fight back, but not from behind pay walls.
In its 2010 technology trends forecast, Deloitte says that 2010 will be the year of the ‘prosumer’ – employees who buy technology devices for both work and play.
Deloitte says the supremacy of broadcasters’ programming schedules is predicted to remain strong. More than 90pc of television and 80pc of audio is expected to be consumed in this manner, meaning linear will continue to reign supreme in 2010, despite the proliferation of non-linear options, such as RTÉ player and TV3 catch-up service.
In addition, the reports predict that mobile search will dominate the strategic direction of the smart-phone market in the year ahead, with search becoming one of the five most-used smart-phone applications by year-end 2010.
“The power of consumers’ choices will be felt in 2010 as IT departments’ procurement decisions are increasingly influenced by employee preferences – for example, in the choice of a mobile device for work and personal use,” Harry Goddard, partner in Deloitte’s technology, media and telecommunications (TMT) group.
“Another key theme that emerges from this year’s predictions is the varying degrees of success that technology will have on the green agenda.
“Although solar demand is likely to grow strongly in 2010 and 2011, some subsidy cuts and cheaper-than-expected electricity rates may prevent that growth from being as strong as some might hope. That said, technology is likely to reinvent cement this year!
“The reports also predict that 2010 will see a greater uptake in cloud computing and desktop virtualisation. It’s clear that cost is likely to be front of mind across the TMT industry this year. This need to cut costs will also have an impact on contract negotiations.
“While the supplier’s focus will be on margins, the client’s imperative to reduce costs may lead to a prolonged negotiation process. This is certainly something that we can expect to see in Ireland as Deloitte Ireland’s recent survey of CIOs found that nearly 60pc of respondents expect their IT budgets to be cut by up to 20pc in 2010.”
In 2010, many enterprise purchasing decisions will be based more on the preferences of individual employees. With the rise of the ‘prosumer’, more and more enterprises are likely to allow employees to choose their own phones, or at least allow prosumer-selected phones to integrate better with enterprise networks.
Enterprise-focused vendors will need to alter sales techniques originally designed to sell to monolithic buyers whose concerns were enterprise in scale. While IT departments will have to become more flexible, best practices are still necessary, such as deleting data on employees’ devices if they change jobs. Also, given the faddish nature of consumer sentiment, processes that reduce product churn will be needed.
The future of many enterprise computing and telecom tools will likely involve compromises between work and personal life, that is, employees being available 24/7 but allowed to choose their own smart phone.
Tech and CO2 reduction
In 2010, technology’s contribution to CO2 reduction could result in electric cars, more efficient airplanes and leaner data centres. Yet there is another largely-overlooked industrial segment that may deliver equal benefit: cement.
Cement production represents about 5pc of global emissions – almost double that of the aviation sector – but is an essential driver of economic growth.
The year 2010 should see the world’s first laboratory scale carbon-negative cement plant, with an industrial scale plant expected in 2011. The total resulting reduction in global CO2 emissions and construction costs could be significant.
The full benefits of carbon-negative cement could be realised after five to 10 years, with sidewalks and driveways likely to be the first carbon negative constructions rather than skyscrapers.
Though 2010 has been viewed as the beginning of the end for the linear schedule, the gap between linear and non-linear usage will remain substantial. Despite the growing range of non-linear options, most content will continue to be consumed according to broadcasters’ programming schedules, with more than 90pc of television and 80pc of audio, respectively, being consumed in this manner.
Linear’s lead may even extend in developing countries, where strong television sales will increase viewership, and in developed countries, where the digital switchover is likely to raise linear consumption. Charging for previously free non-linear services could also boost linear.
In 2010, the newspaper and magazine industry will continue to threaten to charge readers for online content, however that talk is unlikely to be matched by action. Publishers rumoured to be thinking about pay walls may ultimately decide against it, or are choosing hybrid models where most content is free, while charging only for a limited quantity of premium content.
Publishers who use pay walls need to maintain and publicise the premium nature of their content. Excessive cost-cutting could devalue the brand. Online readers might be willing to become micropayment customers, but only if the content is good enough and worth the effort.
For some, acquiring an article for 30 cents online may not justify the time taken to enter credit-card details. Also, the value of the micropayment strategy to the content provider requires volume: one micropayment per customer every two weeks might result in transaction costs exceeding gross margins.
This year's smart-phone market
Leadership in mobile search will dominate the smart-phone market in 2010, despite modest projected revenues at between US$1 billion to $2 billion. However, providers will spend several times that amount to strategically position their companies to exploit future income streams.
By year-end 2010, search will become one of the five most-used smart-phone applications. Search will play a key role in future mobile platforms, with arrangements to share revenues key to a successful business model, and subsidies on smart phones to be co-funded by operators and search-engine platforms.
Developers will need to offer various user interfaces for a variety of user environments, and consider how best to adapt search to these unique characteristics, and the required technologies to integrate and work across a range of application stores.
The year 2010 could be an inflection year for VoIP – voice call over the top of an IP-based network – via mobile phone, given the growing number of Wi-Fi-enabled phones, more Wi-Fi hotspots, and the increase of "one-to-many" communication. Within three years, mobile VoIP could be worth more than US$30 billion globally.
If routed over Wi-Fi, mobile VoIP could lessen demands on the cellular network, and smaller operators in markets where the calling party could see a decrease in overall termination charges. Companies may use the allure of free calls to enable the flow of advertising messages, therefore substantiating the mobile voice market’s value.
If mobile VoIP results in declining revenues for operators, investment available for maintaining networks could drop and threaten the roll-out of next-generation infrastructure. Portals, such as Yahoo or Facebook, could promote mobile VoIP applications by pointing to smart-phone versions of their websites.
By John Kennedy
Photo: Up to 90pc of TV content will still be accessed in traditional linear fashion this year, a Deloitte trends forecast says