press release

release detail

Research, conducted by The Future Laboratory and involving a global panel of experts, highlights the impact of digitally augmented reality, contextual branding and emotional engagement on media and telecoms firms’ business models

Reading, UK – November 10th, 2009 

News Facts
• Oracle, in partnership with future trends consultancy, The Future Laboratory, today launches Capitalising on the Digital Age, a study into how changes in consumer behaviour wrought by the digital world will present telecommunications and media companies with fresh challenges.
• The Future Laboratory recruited a panel of global experts, including Martin Lindstrom (author of Buyology), Hugh Garry (BBC Radio 1 Interactive), and Anders Sandberg (Future of Humanity Institute, University of Oxford), to consider how current and emerging social, cultural, economic and technological forces would impact on the future business models of media and telecommunications companies. 
• The panel assessed influences such as the rise of ‘freemium’ services, the increasing professionalism of the creative consumer and technological advances such as semantic search of film and video to build a picture of consumers’ media consumption in the next five to ten years.
• Among the phenomena predicted in Capitalising on the Digital Age are:
- Digitally augmented reality – Video visors and ultimately contact lenses will digitally enhance everyday life into a three-dimensional wrap-around immersive experience.
- Contextual branding – Predictive and geospatial software will enable brands to target consumer whims through contextual branding. Current advertising formats and models will become increasingly redundant.
- ‘Supertising’ – As multi-screens allow different members of a household to watch diverse content at the same times, ad profiling will be tailored to the individual.
- Emotional profiling – Emotional engagement and depth of connection will replace eyeballs as the dominant media trading currency. 
- Privacy for sale – Consumers will come to realise how important their personal data is to companies wishing to provide them with a world of tailored, immersive entertainment.
- ‘Crowd-charging’ – Crowd-sourcing, already being used in development and marketing efforts, could also change revenue models with companies charging contributors for the privilege of participating in the creative process.
- Recommendation culture – The digital future will not mean tuning into a particular TV channel; there will be a service that allows you to navigate the plethora of choice, recommending what you would want to consume.
• The Future Laboratory identified a number of strategies that media firms should consider in response to changing market conditions and consumer preferences to ready themselves for the future:
- Build and maintain customer trust – Trust will be the most important aspect of a brand, the key to gaining access to more profitable relationships with customers and competitive differentiation.  Users will need to feel comfortable enough to enter the new type of relationship needed for personal, contextualised experiences.
- Become the recommender – The company that consumers turn to when navigating a bewildering sea of choice will be well placed to profit.
- Prepare for new revenue models – Rather than focusing on the main item, companies will increasingly concentrate on the value of add-ons, customisation or personalisation.
- Smarter billing systems – Media companies will need to adapt to changing revenue models and cater for micropayments and assigning money to multiple pots for third-party partnerships.
- Become the orchestrator – In the long run, digital media will be characterised by alliances and partnerships between specialist providers.  As companies jostle for their position in the partnerships that will offer the seamless digital experience, the prize role will go to the company that occupies the centre ground, the ‘Orchestrator of the Dance’.
- Effective, intuitive security – The challenge will be to integrate effective security in a world of digital transactions with an easy, seamless user experience, irrespective of which channel they choose.
• In a world where success will often depend on the closeness of relationships with customers, Capitalising on the Digital Age identifies a unique opportunity for telecoms companies. With the very nature of their business allowing them to know much more about the consumer – for instance, where they are, what they spend money on, what content or applications they download – they have an inherent advantage for tailoring future immersive experiences to the individual.
• The report is available for download from www.Oracle-Marketing.com/MediaFutureTrendsReport

Supporting Quotes
• Gordon Rawling, EMEA senior marketing director for Oracle Communications, said: “The media industry is having to grapple with numerous challenges presented by the public’s digital lifestyles. Falling advertising revenues are exacerbating the urgency of dealing with questions such as how to capitalise on new technologies, engage new audiences and encourage consumers to pay for digital content. Capitalising on the Digital Age sheds some light on the steps that media firms need to be taking to prosper in this environment – for instance, building more intimate ties with their audiences and getting their systems ready to capitalise on new delivery and revenue models.”   
• Richard Windsor, analyst at Nomura International, said: “Strong, entrenched positions will not migrate into the next generation. Telecoms and media companies need to begin work now to press their respective advantages in order to make money in the new landscape.”
• Tom Savigar, strategy and insight director at The Future Laboratory, said: “A new digital economy is being forged: value will lie in having access to customers’ habits and desires.  In exchange for this, companies will offer help to navigate the vast sea of digital choices. The only way to pull any of this off, though, is by gaining trust.”
• Martin Lindstrom, author of Buyology, said: “Contextual branding will become the norm. The entire world will be based on timing and context in the future and few, if any, ads will live outside this space.”  He continued, “Most companies proceed far too quickly in order to gain revenue. Trust is not generated and built in one day – it takes years – and unfortunately few brands seem to have the patience to wait.”
• Carsten Beck, director of research at the Copenhagen Institute for Future Studies, said: “The problem the industry needs to overcome is that executives often cling to what they know and what is familiar to them. Business models must be flexible, with companies ready to commit wholeheartedly to change.”
• Gianvito Lanzolla, Cass Business School, said: “The bottom line is that no company can win by itself. Companies will need to become orchestrated in order to get the total amount of revenue that is out there, which is pretty impressive. The point will be to build firepower to get the biggest profitability.”

Supporting Resources
• Oracle Media Intellectual Property Management
• Oracle Media and Entertainment Products

About Oracle Communications
Oracle is #1 in Communications globally with 20 of the world’s top 20 communications companies running Oracle applications. Oracle Communications integrates industry-specific BSS and OSS solutions with a standards-based service delivery portfolio, as well as the capabilities of Oracle’s industry-leading enterprise applications, business intelligence tools, and carrier-grade middleware and database technologies. Oracle Communications enables service providers to deliver next generation convergent services rapidly, increase customer satisfaction and loyalty, and reduce costs in the business and the network. For more information, visit http://www.oracle.com/industries/communications.

About Oracle
Oracle (NASDAQ: ORCL) is the world's largest business software company. For more information about Oracle, please visit our Web site at http://www.oracle.com

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Contacts:
Marc Sparrow
CMG for Oracle
+44 (0) 207 067 0480
msparrow@cmgrp.com

Anders Rendtorff
Oracle
+45 44 80 83 26
anders.rendtorff@oracle.com