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Tuesday, January 16, 2007

Back to the Future: Digital Media

What probably best summed up the changing media landscape in 2006 was Time Magazine's decision to put a reflective mirror on its cover, subtly stating that its annual nomination for “person of the year” was in fact “You”. As its bye-line read: “Yes, you. You control the Information Age. Welcome to your world”. What this sentiment acknowledged, among other things, was the powerful impact that Web 2.0 technologies has had on the internet and the rise of User-Generated Content (USG) during 2006. Of course, the biggest example of the triumph of USG during the year was the sale of Youtube to Google for the princely sum of $1.65 billion making its founders - Steve Chen, Chad Hurley and Jawed Karim – the most envied twenty-something entrepreneurs in the world.

But there has also been a number of happy convergences that make 2006 stand out as something of a “tipping point” for digital media take-up. I have decided to list out some of the fundamental trends witnessed in 2006 and examine the profound effects they may have in terms of paving the way for the digital future:

The rise of LCD and plasma screens. Or more alternatively, the displacement of the traditional cathode ray tube television. Televisions went widescreen, flat and most importantly, digital. Anyone in PowerCity or Dixons over the Christmas period can attest to this. With LCD and plasma screen technology, the TV now seamlessly integrates into the wall of any apartment or house – and frequently in any number of rooms. They truly are becoming windows on the world.

With multiple connections on the back, you can easily plug-in game consoles, DVD recorders, PVRs and set-top boxes and the PC and, more importantly, switch between them at your leisure. Finally the TV is not just for viewers, it is for users too. The distinction between monitor and television has become necessarily blurred. The next stage now is for easier and inexpensive networking solutions (like “plug and play”) so that media can be ported around the home from one room to the next from a centralised media hub with ease.

Broadband connectivity nears ubiquity. Ireland has been slow. Very slow. But the rest of the world has moved with the times. Finally, the concept of broadband as a utility – like water or electricity - is getting through. The real killer Web 2.0 applications – like Youtube, Apple iTunes, Second Life or Google Earth – all demand a broadband connection and this has fuelled demand for broadband and also for the applications in turn. The next phase now is higher download and upload speeds through technologies such as fibre to the kerb and Wi-Max. Watch eircom and other players move into this space in 2007.

Laptops outstrip Desktops; go wireless. 2006 was the year that laptops (or notebooks) began to outstrip desktop PCs in terms of sales. Computing has suddenly gone portable, thanks largely to built-in Wi-Fi technology as standard. Increasingly, we are seeing more and more people in coffee shops and libraries with their laptops. In fact, Ireland has one of the highest penetration of Wi-Fi hotspots in Europe and the idea of free city-wide Wi-Fi I sbeing seriously mooted by a number of city councils.

2007 will now see the release of Nicholas Negroponte's $100 laptops to the developing world, complete with wireless connectivity. This could be the ideal stimulus for Ireland (in keeping with its desire to be a leading knowledge economy) to introduce cheap cost-effective laptops into the primary and post-primary education system. Could the government follow the Home PC initiative with an even bolder “Laptops for all” in the education system?

Mobiles go multi-media. 2006 was certainly the year when mobiles clearly became more then just phones. It is arguable that post-pay users upgraded to 3G more for the functionality of the new range of phones – with increasingly sophisticated built-in cameras, FM radio and MP3 players - then necessarily for the increased bandwidth and ability to surf the net. However, the rise of the Blackberry and other smart phones was certainly pushed by the killer function of email on the fly. All four mobile operators in Ireland began trialling Mobile TV services with Vodafone launching a commercial service over 3G with Sky.

The next few years will now see the mobile operators steely grip tested by the rapid convergence of technologies that is happening in the handsets. Built in Wi-Fi and DVB-H receivers will offer other avenues of media content and applications (such as VoIP) to users outside the stranglehold of the operators networks. However, the integration of Web 2.0 services into the mobile web may open up new cash cows for the operators as User-Generated Content fuels the changing media landscape. Youtube on your mobile, anyone?

Storage gets bigger and cheaper. Lastly, 2006 saw a further precipitous drop in the price of storage as well as the exponential rise in storage capacity. This could be seen right across the board. Ipods are up to 80Gb – few would have a music collection capable of filling that size but with video now an option, iPods are more storage hungry. 1Gb flash and USB cards are available for less then €50 – remember only a few short years ago, 1Gb was standard hard disk memory in a PC!. Laptops and PCs again have much more storage capacity both in terms of RAM and hard disk memory. All this increased storage capacity is fuelling the Web 2.0 application market which support user-generated content. Second Life and Youtube require vast storage capacities. In the home, personal video recorders and media centres can now increasingly cope with the vast storage demands.

Thanks to Moore's Law, this trend is set to continue. This increasingly will mean the displacement of physical storage such as DVDs and CDs and does put a question mark over the HD-DVD vs Blu-ray battle; might both lose in the long run as digital storage becomes cheaper and studios move towards digital distribution?

So we can see that a number of trends are driving the digital media sector and what's clear is it doesn't look to stop anytime soon. One thing is increasingly clear however. Cheap and fast broadband is a necessity, if Ireland is to stay ahead of the curve. The opportunities that ubiquitous broadband offers in terms of fuelling innovation far outweighs the cost of providing it. Anyone with a laptop, a broadband connection and a basic technical training can now compete on a global scale – whether it is offering an online platform for a traditional business or just selling stuff over eBay. The tools are there.

posted by Neil Leyden @ 5:25 p.m.


At 8:03 a.m., Anonymous Scott Ryan said...

thats really very interesting

At 3:34 a.m., Anonymous Zilli said...

Thanks for writing this.


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