Having spent over 30 years in the business, consulting for top media firms and being associated with marquee events (the Emmy Awards, the Golden Globe Awards, and the American Music Awards) in the entertainment space, John Nendick, the global media and entertainment head of Ernst & Young (EY), has witnessed the convergence of media and technology, and the migration of consumers from traditional to digital platforms. He believes that television is still the dominant medium in the industry. But the definition of TV has changed. They are driving content as well as scripting new chapters on how TV is viewed. Media companies that are oblivious to this changing audience will only flounder. Broadcasters should invest in people who can use new technologies to drive quality content, Nendick tells Forbes India.
Excerpts from the interview:
Q. What global trends do you see in the media and entertainment (M&E) sector that Indian CEOs need to watch out for?
The EY view of the future of M&E is that it will be led by the consumer driving the bus. The introduction of new technologies, be they devices or delivery mechanisms, will put consumers in the driving seat, in terms of what they choose to consume, when and how.
M&E companies need to look through that consumer lens and examine changing consumption patterns, their business model, and the infrastructure they need. Consumers will have the ability to change the way they consume content. Companies need to work towards adapting and not fighting this change.
Most companies have traditionally been business-to-business, but with migration to digital, they need to gear up for the business-to-consumer mode. They will have access to data on consumer trends and loyalty. But it has issues of privacy, confidentiality and [the companies have] the responsibility of handling this data.
Q. CEOs are facing a dilemma on how much they should invest in the future while still protecting the present. How does one strike the balance?
Fundamentally, it’s all about content. One side of media business is the content side, and that is becoming all the more important. No new technology or distribution channel will make content irrelevant. All that technology is doing is enabling more transparency and providing many windows. Great content will always get greater exposure, attract new revenue streams and great branding. Mediocre content will not be any more profitable; rather, it may be less profitable.
On the distribution side, which is where technology investments will need to be made, it will indeed be a balancing act. What the video world certainly can’t afford to do is what its music brethren did, which was to be in denial of what consumers wanted (individual Songs Vs complete albums). Leading M&E companies should embrace change without over-investing.
Q. On the TV-viewing front, what trends do you notice abroad that you believe will soon play out in India?
Q. What can Indian M&E companies learn from mistakes that were made by companies in the West?
(This story appears in the 11 July, 2014 issue of Forbes India. To visit our Archives, click here.)