iPopping \'Digital-Media Opportunities to Create Strategic Business Value\' by Richard D. Smith, SMITH-TRG. $5 Trillion global market. From content creation to distribution to end-user.
iPopping Digital-Media Value Creation Opportunities, by Richard D. Smith, SMITH-TRG
1. February 2010
SMITH -TRG BUSINESS PERFORMANCE & VALUE CREATION CONSULTANTS A
Copyright 2010 SMITH-TRG, All rights reserved.
iPopping
By: Richard D. Smith ‘Digital-Media Opportunities to
CEO, SMITH-TRG
RDSmith@SMITH-TRG.com Create Strategic Business Value’
SMITH-TRG
2. February 2010
contents
Copyright 2010 SMITH-TRG, All rights reserved.
introduction
MEDIA LANDSCAPE
OPPORTUNITY
WHY ACT NOW?
SMITH-TRG
3. February 2010
WHO WE ARE begins
with WHO WE WERE.
Copyright 2010 SMITH-TRG, All rights reserved.
A digital-media venture development and value
creation consulting firm.
Launched second venture as technology sector
imploded, drastically changing the playing field.
Many packed it in. Others didn‟t have the vision,
passion or „Attention Economy‟ experience.
We did. And, we embraced it.
Our consulting, IT/telecom & digital-media roots
uniquely enable us to assist carrier and media
industry/sector/segment CXO‟s develop and
execute business value creation strategies .
As you can tell, our past has a great deal to do
with our present.
As well as our future.
SMITH-TRG
4. February 2010
OUR value view. . .
Copyright 2010 SMITH-TRG, All rights reserved.
"Achieving consistently superior value growth is
the single accomplishment that most clearly
distinguishes great companies from all others. It
is the hallmark of exceptional leaders. In our
experience, a focus on value is our key to helping
clients‟ achieve superior performance, and it
therefore forms the basis of everything we do”.
- Richard D. Smith, SMITH-TRG
SMITH-TRG
5. February 2010
WHAT we have done. . .
Advised 4 global consumer electronics
innovation leaders on –
Copyright 2010 SMITH-TRG, All rights reserved.
strategy
product portfolio(s) & pipeline
high-impact & high-value B2B deals
M&A
retail store transformation & expansion
emerging smartphone & multi-touch screen
markets
new wireless application platforms & related
services
Developed X-Otica a digital-media enabled
retail store of the future – basis for world‟s
most successful (revenue per square foot)
retail chain
SMITH-TRG
6. February 2010
plus . . .
Advised wireless carrier, IT, consumer product, media
Advised 4 global consumer electronics
& entertainment, hospitality, –
innovation leaders on automotive, advertising,
Copyright 2010 SMITH-TRG, All rights reserved.
and marketing companies on digital-media
strategy
Assisted mall operators and retail chains ROI optimize
product portfolio(s) & pipeline
place based „Digital Out-of-Home‟ networks
high-impact & high-value B2B deals
Authored book, AD-MIRED, „Media‟s Power to Create
M&A Value‟, 2006
Business
retail store transformation & expansion
Advised Seoul Korea on „Digital-Media City‟ (DMC),
emerging smartphone future
multi-billion dollar city of the & multi-touch screen
markets
Foundedwireless Media (AIM2)platforms & related
new Audient application a audience interactive
mobile-marketing, „Advertainment‟ content, and
services
wireless advertising venture
Developed X-Otica a digital-media enabled
retail store of the future – video-messaging,
Founded Saint CRISPIN a global basis for world’s
most successful (revenue per square foot)
(precursor to „video-mail‟) venture, sold to F-500
retail chain
SMITH-TRG
7. February 2010
WHAT we believe. . .
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“The greatest value creation opportunity
will fall to those who give the end-user
consumer what they want…really, really
want. And that is: an integrated, easy to
use, video media experience, anytime,
anywhere, and on any platform.”
- Richard D. Smith, SMITH-TRG
Author, AD-MIRED, 2006 book
SMITH-TRG
9. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
Market Size
$5 Trillion
Global annual value
SMITH-TRG
10. February 2010
Content creators
Media companies
Aggregators (network)
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Value Chain
Aggregators (broadcast)
Back-office Apps
Network service providers
Pieces Carriers (domestic/global)
Infrastructure (IT/services)
Portals (music/video/books)
From content creation to Devices (hardware)
distribution to end-user Devices (software)
Apps providers
End-user (media consumer)
End-user (business)
SMITH-TRG
11. February 2010
Market
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Players
Anyone, small to large, in
and/or around digital-
media eco-system
markets
SMITH-TRG
12. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
A Market Mover
Snapshot
Vision. Innovation. Value Creation.
SMITH-TRG
13. February 2010
Shares trading $45 to $55
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Retail store chain (26) in
2005 need of re-invention
(Revenue per Sq. Ft. $1,000)
Apple
5 Year Snapshot Product portfolio & pipeline
decisions required
Value growth plan pending
SMITH-TRG
14. February 2010
FANATI C I S M
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“I think fanaticism is underrated.
I‟m a fanatic about the engineering
groups. Steve (Jobs) is a fanatic
about the user experience and
the design.”
- Bill Gates, Microsoft
Advice for entrepreneurs, enterprise game changers
SMITH-TRG
15. February 2010
Shares reach $199
Retail chain transformed,
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revenue per Sq. Ft. $4,000
2007 iPhone launched, AT%T
Vision & Value Progress exclusive & user revenue
share deal reached
Product portfolio/roadmap
established
SMITH-TRG
16. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
2009
(Apple officially a computer
hardware & software company)
Strategically morphing
itself into a media
company
SMITH-TRG
17. February 2010
iPhone
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A "zero" revenue
contributor three years ago.
Fourth-quarter 2009,
iPhone revenue up 90%
year over year to $5.6 billion.
SMITH-TRG
18. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
iPhone & iPod
contribution . . .
$9 billion of total $13.5 billion
in quarterly revenue.
Two thirds of total!
SMITH-TRG
19. February 2010
Shares trading @ $200+/-
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Earnings per share up 562%
2010 Shareholder equity up 428%
5th Yr. Value Delivered Cash on hand up 411%
Retail chain 250+ stores
world-wide, still $4,000
iPad launched revenue per Sq. Ft.
SMITH-TRG
20. February 2010
Apple
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Systematically tilts wireless Value Strategy
playing field to their advantage.
“Apple extracts more and
Apple designed iPad chip, dubbed more of the value, while
A4, marks strategy shift first carriers get more and
signaled by 2008 purchase more of the costs.”
of start-up P. A. Semi. - Craig Moffett, Senior Analyst
Berstein Research
SMITH-TRG
21. February 2010
iPad
(again Apple demonstrates)
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“To create greater business
value – One does not have to
be first to create, just first to
innovatively perfect what has
been created.” Richard D. Smith
SMITH-TRG
23. February 2010
Global Carriers
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Forecasted Wireline & Wireless Revenues
Transport Revenues $1.65T
2007 vs. 2012
$2.2T
Trends Dial-up
Broadband % share
Wireline % share
3%
8%
42%
2%
11%
31%
Wireless % share 47% 56%
(does not include satellite carriers)
Source: Verizon study
SMITH-TRG
24. February 2010
U.S. Wireless Growth
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2005 vs. 2009
U.S. Subscribers
Penetration
194.4M
66%
276.6M
89%
Wireless
(% of U.S. Population)
Wireless Only Households 7% 20%
Annual Total Rev. $108.5B $151.2B
Annual Data Rev. $8.5B $37.0B
Annual Minutes of Use 1.26T 2.23T
Annual SMS Messages 52.2B 1.36T
(Source: CTIA)
SMITH-TRG
25. February 2010
Google enters mobile space. . .
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Introduces
Android
SMITH-TRG
26. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
Why? 5 Billion
Cellphones world-wide
(Global population 6.8 Billion)
Strategic Global Growth
SMITH-TRG
27. February 2010
Smartphone
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Landscape
iPhone has 13.7% share &
74% user satisfaction rating
RIM has 20.9% share &
2nd place positive user
rating with 43%
SMITH-TRG
28. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
“Within five years 90 percent
of mobile traffic will be from
Forecast Internet-enabled laptops and
smart phones”.
- John Chambers, Cisco
SMITH-TRG
31. February 2010
„06 Pixar & Disney Merge
A proprietary technology & digital content value-creation deal
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SMITH-TRG
32. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
Pending M&A
NBC-Universal-Comcast
“Will competition be sustainable with
$30B Merger the largest video and broadband provider
controlling huge quantities of content?”
- H. Waxman (D-Calif.)
SMITH-TRG
33. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
Motorola to spin-off wireless
Future Spin-Off handset & TV box business
into new public company
Q1, 2011
SMITH-TRG
34. February 2010
New Strategy
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Content focused company
Enterprise AOL acquired StudioNow
a Nashville based video
Reinvention production firm.
Paid $36.5M cash & stock
SMITH-TRG
35. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
From High-Impact Deals
to Media Applications
SMITH-TRG
36. February 2010
Apple’s exclusive
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AT&T carrier deal
expires in 2012.
Will the deal winner be
Verizon, T-Mobile, ?
SMITH-TRG
37. February 2010
Apps market
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larger than Apple
2
and Android. . .
X
Small businesses as
applications developers
(**iPhone 200,000 apps) Downloads!
SMITH-TRG
38. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
Mobile
Advertising
High growth Apps market
SMITH-TRG
39. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
In-Cinema
„Big-Screen‟ real-time
interactive advertising!
Doable? Yes!
Exist today? No!
SMITH-TRG
40. February 2010
Imagine
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Interactively engaging
viewing audiences with
„Advertainment‟ content in
Traditional, IMAX or Digital
Cinemas.
There are 38,600 movie theatre
screens in the U.S.. In 2009,
1.4 billion patron admissions.
SMITH-TRG
41. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
From Multi-Touch Screens
to Niche TV Platforms
SMITH-TRG
42. February 2010
Digital Signage,
Out-of-Home
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Ad Networks
Multi-Touch Wall Screens
the next generation of
place-based signage.
The U.S. retail industry is comprised of nearly 1.1 million establishments with annual
sales of nearly $4.5 trillion. As retailers struggle in today‟s economy, digital signage is
increasingly finding its place as a branding and merchandising tool near point-of-sale.
SMITH-TRG
43. February 2010
Niche Media
Platforms
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Commercial use TV/Screen applications
SMITH-TRG
45. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
A $5 Trillion
Target of Opportunity
(global media sector on growth curve)
SMITH-TRG
46. Copyright 2010 SMITH-TRG, All rights reserved. February 2010
It‟s about building your. . .
W H Y ACT N O W ?
SMITH-TRG
47. February 2010
SMITH-TRG
BUSINESS ADVISORS.
VALUE CREATORS.
Copyright 2010 SMITH-TRG, All rights reserved.
We assist. . .
CEO‟s to create business
Thank you!
value
CXO Stakeholders to solve
business performance
problems
Innovators to develop more
successful „customer-centric‟
propositions
Business Developers to
maximize return on their
investments
www.SMITH-TRG.com
48. February 2010
OUR digital-media PRACTICE
Enterprise leaders in the digital-media space are known for being
Copyright 2010 SMITH-TRG, All rights reserved.
many things. Patient is not one of them.
Consequently, they want someone who understands creating
strategic business value in the media space, they desire „trusted-
business advice‟ and new competitive advantage solutions, and they
want and desire them today!
Fortunately, with two decades of international telecommunications,
wireless, and digital-media industry experience, SMITH-TRG excels,
not just at developing executable strategies specifically for the client,
but developing them quickly.
SMITH-TRG