Dominic Yang

Word count: 1165 PIN: 10601

Finding the Next Wave to RideThe Digital Industry in a Changing World

This essay defines a trend as the tendency of the majority of consumers to shift

their preferences in favor of certain new products, or for businesses to shift the conduct of

their affairs in line with innovative new practices and technologies. While businesses

often are forced to react to trends, they should not simply reproduce the specific product

or practice that defines a trend, but rather should continue to innovate. Several trends

have found expression in recent business developments, and continue to drive innovation.

Among these, this essay will focus specifically on trends in the digital industry: the

content, skills, and services that attempt to integrate and deliver text, images, audio, and

video in a digital format. Digital industries include, among others, telecommunications

(text messages in cell phone), computer-based game applications, digital multimedia

products (playing TV or music on computers), digital publishing (e-book), and online

learning.

One major trend affecting digital industries is that they produce merchandise that

serve multiple purposes. Ten years ago, people would not have expected to be able to

watch TV shows on their cell phones, but recently have come to expect such devices to

be capable of integrating various services. For example, today’s video game consoles,

such as the Xbox, do much more than simply allow gamers to play cartridge- or disc-

based games; they now also allow individuals to connect to the internet, where players

can download music, play games with their friends online, and communicate with other

players. Some systems even double as DVD players. In these and other ways, digital

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Dominic Yang

Global Initiatives Symposium in Taiwan 2009

Dominic Yang

industries are attempting to maximize the capabilities of their products to suit the

evolving technological preferences of their customers.

The importance of meeting the needs of potential customers has also led the

industry to increase their efforts to engineer products that are compatible with a wide

array of other popular technological products and systems. The iPhone is perhaps the

most outstanding example of this trend. After the iPhone became popular, many

companies began to develop internet-related products that could integrate with that item.

For example, Blackboard is one of the major online learning companies in the United

States, allowing, among other things, for educators and students to access information

pertaining to their academic courses. In light of the popularity of mobile devices,

Blackboard has arranged for iPhone users to receive notifications of important

information, such as grade changes, whereas students would previously have received

this information through their regular e-mail providers.

Many internet applications demonstrate the direction of moving from information

exchange toward an emphasis on social interaction in today’s society. For example, the

number of active users of the popular social networking site, Facebook, has exploded

from 120 million in October 2008 to over 175 million as of February 2009. This trend has

been aided by the broadened base of interest. Social networking has become popular for a

diverse array of age groups; according to statistics provided by Facebook, more than half

of its users are now 30 years old or older. The widespread social networking phenomenon

has further influenced the consuming behavior of the public. For instance, many people

tend to draw upon internet expressions of popular public opinion as guides to their own

potential consumption preferences, such as when an individual seeks out reviews of

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Find the Next Wave to Ride On - New Business Strategies in the Changing World

products or services posted by other consumers. As a result of the increased availability

of such word-of-mouth publicity, businesses should be more concerned than ever about

providing efficient services and useful, popular products.

The popularity of social networking sites has lead to the widespread proliferation

of social networking applications. Users can sign up for applications that offer everything

from a “word of the day” to up-to-the-minute stock quotes. One may thus anticipate that

more products will emerge that will take advantage of this application craze and to

maximize their marketability. These applications come with risks, however. Despite the

attraction of social interactive features, many current applications require individuals to

release personal information that would otherwise not be available to the public. Thus,

while attempting to create a greater sense of community among consumers and ease

interpersonal communication, companies are inadvertently creating an environment

conducive to identity theft. Facebook applications have already come under fire as

potential risks because they are created by third-party developers, some of which actively

seek to steal personal information. In allowing iPhone users to utilize Facebook

applications, it remains unclear as to whether such risks have been removed, or if these

businesses are perpetuating the problem for the sake of market success.

Recent developments have shown that the integration of services represents but

one component of mobile services’ rise to prominence as one of the major factors driving

growth in digital industries, a trend that will see significant growth through the next

decade. One indicator of this is the fact that the number of cell phone users has

dramatically increased over the past five years. According to a recent United Nations

report, 46% of the world’s population owns a cell phone, with China, by far the largest

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Global Initiatives Symposium in Taiwan 2009

Dominic Yang

world cell phone market, having more than 600 million subscribers as of mid-2008.

Although most mobile broadband subscribers may be found in industrialized regions,

many developing nations, especially Indonesia and the Philippines, have started third

generation (3G) networks. Also, the Asia-Pacific region’s continued development of its

broadband market – the largest in the world – is likely to further increase the demand for,

and production of, higher quality digital content and equipment.

In addition, the digital era has increased the number of competing businesses by

equalizing access to the market and making effective business strategies more affordable.

In the global market of previous decades, only large companies were capable of opening

branches, subsidiaries, and factories in foreign countries. This granted to these

corporations advantages which smaller businesses simply did not have. Namely, the latter

have the ability neither to produce in countries with more favorable tax policies nor to

produce and sell goods in the target markets, thereby avoiding export costs. Recent

developments in technology and communication, however, now allow small- and mid-

sized companies to conduct business abroad both conveniently and affordably. E-

commerce has decreased the cost of managing a far-flung enterprise while enhancing the

ease with which businesses can access the global pool of potential consumers.

In addition, other factors which determine the success of digital industries will

depend on the extent to which companies continue to improve upon their current products.

Due to the continuing rapid evolution and development of consumer technologies,

customers have increasingly higher expectations of what their products should or must

provide to meet their needs. However, as normally happens with a trend, many digital

businesses hopping on the bandwagon decide to produce products that mirror the popular

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items of the day and that share similar features. In order to attract more consumers,

future digital products need to continue to innovate, providing new special features and,

thus, increasing their competitiveness. Moreover, successful digital products must be

compatible with an increasing number of other systems and products.

Global Initiatives Symposium in Taiwan 2009

Dominic Yang