The End of Industry Boundaries Within Creative Industries
The technical distribution medium called Internet meant the end for many exploitation models of creative industries. It will also be the end for the sector boundaries within the creative industries. For this reason, companies that are dealing with new business models are confronted primarily with the question of which industry they will be in by tomorrow.
Music, movies, software, games, books, newspapers, radio and TV are differentiated into industries that each follow their own production and exploitation logic. Thus, the industries have their own structures, platforms and organizations. In all areas products are made, partly with substantial investments, which are then distributed in the greatest possible circulation through data carriers and channels. Success is measured by the number of units, circulation and quotas. The Internet reminds us that this logic of the industry has always remained alien to the consumer. He listens to the radio while cooking, at the same time the TV runs and the phone rings. Later, he flips through the newspaper, checks his emails, makes another phone call, watches a movie for a while until he takes a book and listens to music in the background. According to previous business logic, at least seven different market researchers and industry experts should be occupied with the evaluation of this example.
Meanwhile, the existing media areas music, movies, software, games, books, journalism, radio and TV can in principle be consumed over the Internet by an end device. On the Internet everything exists side by side. Previous separations into the categories music and book or movie have been manifested by data carriers. This artificial separation has led to the formation of media industries, without being asked we as consumers had to endorse this when buying and using their products. With the convergence of media sectors we are only at the beginning of a revolutionary development. Today we are dealing with an irresolvable coexistence. Tomorrow sounds, texts and moving images will be connected by their creators in a way that we cannot say anymore whether the product on our PC, iPhone or Kindle is a book, a piece of music, short film or a completely new product shape. If providers want to compete here, they must ask themselves what they are actually selling. At the moment, many companies still think only in categories of media carriers. Although they have the possibility to offer their customers so much more: events, entertainment, experience and knowledge. Until now, this spectrum only appears in marketing, in order to sell the bits and bytes on data carriers better.
At present, diversity and flexibility are required, stable patterns of successful business models on the Internet will develop over a long period of time. The evolution of the letterpress took several centuries. Now we are facing a similar revolution. At the beginning, analog business models were translated into the digital world. Now digital business models are originally established on the Internet. The first rules of success are generated thereby. This includes an easy usability and no restrictions concerning the handling, such as copy protection. Successful models are often based on the inclusion of the customers. They rate products, for example at Amazon, or they contribute as it is demonstrated by facebook. We are experiencing a renaissance of subscription models, if they are combined with a set of choices. We know from our research that among those customers of new offerings are also those who are in other contexts known as “copyright pirates”. Users who illegally copy the most, often belong to the pioneers when it comes to new legal offers, since they usually have a wide range of interests.
Altogether, many companies are asked to get in touch with their customers again, before earning money. Only fifteen percent of consumers trust advertisements, while 90 percent of them rely on recommendations. Concerning business models on the Internet, there are experiments with different possibilities taking place at the moment. Not all experiments will be crowned with success. However, who wants to defend old business models has lost already. The different protagonists of the creative industries should, while developing new digital business models, regard the dissolving of former industry boundaries as a chance for their own re-positioning and take an active part in the development of new markets.