Business Strategy

The danger of being comfortable: Entertainment

It’s the year 2000. You want to watch a movie, so you go to a movie theater. You want to want to listen to that new popular song whenever you want, so you buy the CD, or maybe even the single. You missed your favorite TV show? You better hope one of your friends recorded it on VHS tape before the new one airs next week. This was the consumer way of life for many decades prior to 2000 in the world of entertainment.

The entertainment industry was one of the very first to be disrupted by technology. Around the year 2000, a little tech monster called Napster crept onto the music industry’s radar, disrupting how people had access to copyrighted music. While illegal, the popularity spoke volumes of the demand of downloadable creative content. While artists, labels, and other companies lost money by the literal billions, the industry desperately needed a solution for a legal way to download, stream, and purchase music on the internet.

Apple stepped up to the plate and launched iTunes. At first, it was just jukebox software, able to store digital music files on a computer. In 2003, Apple released the iTunes Music Store, the first legal platform for distributing digital music for a cost. It was a hard battle, though. Convincing and reteaching the general population that music wasn’t free took quite a bit of time and marketing (as well as a few lawsuits). When the iPhone was first released in 2007, iTunes was a pioneer mobile application for storing digital music files. Even though it’s been through many versions at this point, it is one of the oldest, and most successful, mobile apps out there today.

The music industry wasn’t the only entertainment realm that had a significant jolt in the early 2000s. As internet bandwidths and hard drive capacities increased, the ability to torrent movies and other visual content became prevalent. It’s fair to say that this disruption was the pivotal moment that redefined how the public consumed entertainment content.

The torrent, or peer to peer sharing, phenomenon was also the beginnings of the social media age. Entertainment became a topic of conversation beyond face-to-face engagements. Technology had to move at the speed of light to keep up with demands and expectations.

Fast forward to 2015. Who are some of the major players in entertainment technology?

In July 2015, Netflix reported its subscriber count reached 65.6 million, with 42.3 million in the U.S. and 23.3 million internationally. With a minimal monthly subscription, users have access to over 10,000 titles ranging from films to TV shows to original content. When Netflix entered the original content stratosphere, they took a major step forward in the game. By creating on-demand series and movies, they rebranded themselves as a source of content you could find nowhere else. Several award-winning productions later, they’ve reached respect levels similar to the likes of HBO.

Amazon Video
Formally known as Amazon Instant Video, the company rebranded itself in September 2015 under a new, shorter name. Amazon Video also plays competitively in the original content arena, premiering their first series in 2013. Amazon Video has the distinct advantage of association through big brother, a brand so popular most people in the world are familiar with their services. Having more assets and relationships than most other companies out there, their access to creative content is vast.

iTunes and Apple Music
The edge iTunes has above the others is its direct connection to Apple, and the compatibility with their products. They also extend well beyond film and series. Music was their original baby and remains one of their prime services. They have a pulse on the industry like no other and they know their audience well. Apple Music was introduced on June 30, 2015 as a music streaming service. This new application offers access to 30 million songs by paying a monthly fee of $9.99. The purpose of Apple Music is to deepen the music experience through peer to peer recommendations and artist to fans connection.

All Apple touches doesn’t turn to gold, however. In 2010 they launched Ping, a software-based, music-oriented social networking and recommender system service. It failed to stack up to communication usage on other social networking sites, so in 2012 it closed the service and replaced it with Facebook and Twitter integration in iTunes.

Not only was entertainment the first child of technology disruption, the tech leaders in these industries are still some of the biggest, best, and most profitable. It will also be the industry to expect the most impressive blindsides from in the future. If you have an idea that might change the way we access or enjoy entertainment, the conversation starts here.

By Jen West