Publishing in the Knowledge Economy - DTI Home Page

Publishing in the knowledge economy
The industry today
discretionary spending
• (But) low business profitability and low growth
hit B2B and B2C advertising
• Product innovation – e.g. new magazine
launches – slows
• E-commerce stalls as business investment
slows and consumers shun online shopping
• Consumers unwilling to share personal data
but are less fickle and more brand loyal
• Local media and libraries more valued as
people spend less time at work
• Mergers and acquisitions accelerate as media
companies attempt to gain scale
Outcome
If the new business environment is slow to
take off due to the slow take up of network
technologies, publishing companies will be
exposed to the weaknesses in the industry
where sales per title are declining and there will
be no chance of exploiting the opportunities
projected to occur in the new business
environment.
Should the industry not move to put into place
new processes and supporting technology to
reduce costs in the business, the problems will
be compounded as the industry will be faced
with diminishing revenues without being able
to reduce costs.
The publishing industry will lose out because
it will be exposed to its weaknesses and unable
to meet the challenges of a shrinking business
environment.
14.3.2 The fast pace of the change in
the knowledge economy catches
publishers unaware
This scenario assesses the impact of a very
dynamic change in the business and
competitive environment with the shift to a new
knowledge economy occurring at a rapid pace.
It further suggests that publishers have had
insufficient time to prepare for the new
environment and are exposed to the threats
that have been identified with regard to missing
out on exploiting the new opportunities.
Premise
• Economy supports personal consumption
growing at a faster rate
• Affluent and young consumers use interactive
technologies for (some) physical shopping,
digital purchases and billing and banking
transactions
• ‘Destination shopping’ occurs mainly in outof-town
developments incorporating other
entertainment facilities and ‘shop windows’ for
travel and financial services
• Pace of technology growth continues
• The roll out of broadband and wireless
technology accelerates
• Publishers squeezed by new entrants into
market
• Large funds are put into new start-ups, but
lessons are learnt from ‘Internet’
Implications
• Publishers are panicked into ‘Internet-type’
response
• Publishers forced to develop chargeable
services around creation and use of content
• Focus is lost on existing business as time and
money is spent on catching up
• Lack of incentives to create content
• Large investments are made adapting content
and advertising systems
• Publishers unprepared to exploit new
opportunities
• Content may be dumbed-down, but
information easily available to every consumer,
wherever they are
• Even greater fight for attention from
consumers
• Retail chain becomes less important
• Sophisticated CRM and CMS needed to
manage multiple channels
• Large retailers become major guardians of the
customer relationship and customer data
• Retail brands are the most trusted by
consumers and are extended back into
publishing value chain
Outcome
The speed of change is such that publishing
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