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#tcmc
Coming Together or Falling Apart?
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#tcmc
Coming Together or Falling Apart?Introduced By!
Jon Watts, MTM London !
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This document is confidential and intended solely for the use and information of the addressee
12th June 2014 │ MTM │ Contact [email protected] │ Tel +44 (0) 20 7395 7510
Coming together or falling apart?
!A panel discussion
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1. Setting the scene
2. What’s happening and where’s it going?
3. Future scenarios for the children’s media market
4. Fact or fiction?
!!!
Exploring the future of children’s media and content in the UK, from a business and commercial perspective
Welcome to today’s panel discussion:
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MTM is a TMT research and strategy consultancy, advising clients in digitally-driven markets
What we do Recent clients
• Market and economic analysis • Technology forecasting and analysis • Competitor benchmarking • Market sizing and forecasting
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• Qualitative and quantitative research • Content, brands, ads, technology • Demand and pricing analysis • Attitudes, behaviours, preferences
• Vision and strategic planning • Opportunity assessments • Product and proposition
development • Commercial growth strategies
• Organisational and business process design
• Digital transformation • Leadership coaching and support • Implementation and action planning
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Introduction to MTM
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Introducing our expert industry panel
Tina McCann, SVP and MD – Nickelodeon UK and Ireland
The panel
Rob McMenemy, CEO – International Division, Egmont Publishing
Alice Taylor, CEO – MakieLab
Kate Wilson, Founder and Managing Director – Nosy Crow
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The children’s media market is changing …
1. Setting the scene
Source: Simon Leggett, The complex media interactions of children aged 5 to 16 (2014)
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Many challenges, but opportunities proliferating
1. Setting the scene
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As media consumption and consumer spending change, how will the market evolve?
1. Setting the scene
• More fragmentation … The opportunities for brands created by small players – start-ups and one-man-bands – have never been greater. If an idea is good, and you market it cleverly, you can succeed with pretty minimal investment
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As media consumption and consumer spending change, how will the market evolve?
1. Setting the scene
• More fragmentation …
• … or further consolidation?
The larger players still dominate and that isn’t going to change. Disney has so much to invest – they can develop things, scrap them, and try again – and they have so much expertise and so many resources for testing and trying things out.
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As media consumption and consumer spending change, how will the market evolve?
1. Setting the scene
• More fragmentation …
• … or further consolidation?
• Digital-first the norm …
It’ll take a while, but it will happen. Kid’s consumption patterns are changing, along with the rest of us. Pretty soon you won’t need TV… every kid’s character brand will have a digital element at the very least, and lots will start there
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As media consumption and consumer spending change, how will the market evolve?
1. Setting the scene
• More fragmentation …
• … or further consolidation?
• Digital-first the norm …
• … or film and TV still on top?
People talk a lot about digital properties generating substantial M&L revenues, and there certainly are some – we manage a few of them. But the number is small – most of the time, I want to see a second TV series before I really commit to something
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As media consumption and consumer spending change, how will the market evolve?
1. Setting the scene
• More fragmentation …
• … or further consolidation?
• Digital-first the norm …
• … or film and TV still on top?
• Shifting cultural boundaries?
Digital is enabling ideas and concepts to spread more freely across borders, but there are cultural barriers to consider – most content creators are considering this and tailoring their brands… what we are seeing is more international partnerships, though.
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Is this the best of times or the worst of times for children’s media and content?
2. Panel discussion
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Is this the best of times or the worst of times for children’s media and content?
2. Panel discussion
• Most challenged business models?
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Is this the best of times or the worst of times for children’s media and content?
2. Panel discussion
20% tax breaks for
animation?
• Most challenged business models?
• Most exciting areas of new opportunity?
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Is this the best of times or the worst of times for children’s media and content?
2. Panel discussion
• Most challenged business models?
• Most exciting areas of new opportunity?
• Commercial, strategic implications?
‹#›
Is this the best of times or the worst of times for children’s media and content?
• Most challenged business models?
• Most exciting areas of new opportunity?
• Commercial, strategic implications?
• New business models emerging?
2. Panel discussion
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Introducing our four scenarios for 2020:
2. Playing to win1. Digital media eats the world
4. A thousand flowers bloom3. The death of print
3. Future scenarios
Please note: these are thought experiments, not forecasts
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1. Digital media eats the world
• Internet-connected devices emerge as the dominant children’s medium
• Linear channels and broadcasting decline
• On-demand becomes the dominant mode of TV consumption
• Digital businesses emerge as major children’s media players
• Many children’s broadcasters shift completely online
3. Future scenarios
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2. Playing to win
• The games industry becomes into the dominant children’s medium …
• … driving the creation of new IP and major children’s franchises
• Toy and games companies become even more important funding sources
• Moshi Monsters, Club Penguin and Angry Birds acknowledged as trail blazers
• Lego is the new Disney
3. Future scenarios
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3. The death of print
• Physical book and magazine markets decline rapidly as digital takes-off
• Magazines transition to digital …
• ... and physical book buying persists only as a small gifting market
• Children’s publishers shift online –some successfully, many fail – but new players proliferate
• Apple and Amazon become (even more) dominant players, but major authors increasingly go direct
3. Future scenarios
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4. A thousand flowers bloom
• Costs of entry fall, content-creation tools proliferate and digital platforms provide easier access to audiences,
• New businesses use digital platforms to address global markets
• Rather than consolidating, the market fragments
• Big children’s franchises persist...
• ... but creative destruction becomes the norm – new properties burst to life, but with shorter life-cycles
3. Future scenarios
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A final thought from our panel …
3. Future scenarios
A realistic scenario for the Children’s media market in
2020?
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Time for some audience participation …
Fact Fiction
By 2020 …
or
4. Fact of fiction
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Bagbuss will be the largest UK children’s brand
4. Fact of fiction
Source: Publishers Association, PA Statistics Yearbook (2013)
By 2020?
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2009 2013
298333
The children’s physical book market will be worth less than 50% of its current retail value?
4. Fact of fiction
Source: Publishers Association, PA Statistics Yearbook (2013)
By 2020?
Sales of physical books in the UK (£m)
-10.6%
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Digital children’s books will be worth over £150m
4. Fact of fiction
By 2020?
2009 2013
£16.0
£0.5
Sales of digital books in the UK (£m)
+5,762%
Source: Publishers Association, PA Statistics Yearbook (2013)
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Netflix is the world’s largest commissioner of children’s television and video?
4. Fact of fiction
By 2020?
Source: FierceOnlineVideo, A closer look at the billions of dollars Netflix, Amazon and Hulu are spending on original content(2014)
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A film based on a digital-first brand (e.g. Moshi Monsters) tops the UK box-office?
4. Fact of fiction
Source: BBC, Lego movie stands tall at UK box office (2014)
By 2020?
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75% of the top 20 children’s apps will be made by microbusinesses (fewer than 10 employees)?
4. Fact of fiction
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Children’s print magazines will have a total average issue circulation under 1m
4. Fact of fiction
By 2020?
At a time when kids have access to more digital devices that ever before it’s good to see in that children’s magazines are doing great business – compared to the same period five years ago circulation has increased by a 29%!
Current circulation
c.2m+
Source: Adam Woodgate, Children’s magazines are bucking the trend (2013)
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UK children will spend over 20 hours online each week
4. Fact of fiction
By 2020?
2007 2012
129.7
Average hours spent online per week by UK Children
Source: Ofcom, Children and parents: Media use and attitudes report (2013)
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THANK YOU!
#tcmc
Coming Together or Falling Apart?
