Media and entertainment companies must embrace egalitarian consumption habits driven by social media and mobility to fulfill desires for a unified experience across all devices and channels.

1. Democratized Content is King
Media and entertainment companies must depose traditional content
monarchies and embrace egalitarian consumption habits driven by
social media and mobility to fulfill desires for a unified experience
across all devices and channels.
Executive Summary
The wedding of Prince William and Kate Middleton
in April 2011 was a reminder to many about the
role of the British monarchy in today’s world. The
event was watched by millions, and for a few days,
London was the party capital of the world, with
many an expert’s hours spent analyzing who wore
what and who did or did not make it to the list.
The average Briton’s response to all this was, “Oh
we love the monarchy… as long as they do not
interfere with what I do.”
Bill Gates coined the phrase “content is king” in
1996,1
and it has stuck, through thick and thin.
However, the world of media and entertainment
convergence has come a long way since the
middle ages of the Internet revolution, circa the
late 1990s. Today’s consumer does not like to be
told what to watch, when to watch, how to watch.
He is spoiled for choices and revolts the moment
anyone tries to second-guess his preferences.
In other words, we live in a democratic era where
devices, platforms and carriers are continuously
vying for a share of our attention — and content
is a means of getting that attention. So, like the
British monarchy, content is still king, and it helps
attract attention, as long as content owners do not
dictate terms. Today’s media and entertainment
space can be likened to a king in a democracy.
In today’s democratic landscape of digital content
consumption, shifting paradigms are the rule
rather than the exception. Principles of Web 2.0,
cloud, mobile apps and rapidly evolving software
and communication technologies have paved the
way for an all-pervasive democratic revolution
known as social media. At the same time, hardware
innovations in the mobile and tablet space are
introducing unprecedented levels of connectiv-
ity and interactivity, empowering each and every
consumer.
Media companies, from film and television to
music and print, are feverishly trying to adapt
their approaches to this new reality. Business
models that worked for decades have vanished,
and fresh ideas are the order of the day.
However, usage and revenue patterns emerging
from the ever-changing digital world present new
challengestomediaandentertainmentcompanies.
While reach attained in the online/mobile world
was unheard of in print, online content does not
have the same revenue potential per unit as print
or broadcast content; with mobile, it is even lower.
Media companies need to accept the following
realities while planning for the future:
• Customers are increasingly less likely to go
looking for content; content needs to reach out
to where the customer is.
• Cognizant 20-20 Insights
cognizant 20-20 insights | april 2013

2. cognizant 20-20 insights 2
• Content consumption is moving from buffet
style to à la carte.
• The Internet has stripped media companies
of their control over how their products are
distributed.
• The lines between different types of media
have blurred.
• Media convergence is resulting in new com-
petitors and collaborators in the marketplace.
• Virgin content with no social wrappers is
unlikely to engage the millennial generation
effectively.
• Simultaneous multi-device customer
engagement is the new reality.
This white paper examines the effects of these
changes and illustrates potential options that
will help content companies remain relevant and,
more importantly, solvent.
Social Media, Mobile Devices Take
Over the World
In the first decade of this century, content con-
sumption irreversibly shifted to digital. Powered
by ever-increasing broadband speeds, 3G and 4G
networks and an explosion in the smartphone and
tablet markets, the digital content marketplace
has overwhelmed all other forms of content dis-
tribution. By 2020, the size of the digital universe
is expected to be 35 zettabytes, 44 times higher
than the 0.8 zettabytes of 2009.2
Moreover, the
international digital content market is expected
to grow to $36 billion in revenue by 2014, more
than twice the $16.7 billion chalked up in 2009.3
Mobile content consumption is expected to
increase at a much faster rate than wired con-
sumption in the coming years. From 2012 to
2016, revenue generated by mobile Internet
access is expected to grow at 12.2% annually
compared with 7.1% for wired access (dial-up and
broadband).4
And consumers are expected to use
4G networks to consume ever increasing amounts
of multimedia content. By 2017, mobile video will
represent 66% of all mobile data traffic, and 4G
connections will account for 45% of global mobile
data traffic.5
Increased digital content consumption is accom-
panied by the equally game-changing and all-
pervasive emergence of social media. In 2012,
social networking accounted for 20% of the total
time people spent on PCs, and 30% on mobile
devices.6
The biggest social networking phenomenon in
the world, Facebook, is consuming a growing
timeshare of Internet consumption. After
performing the seemingly impossible task
of dislodging the Google home page as the
most visited Internet Web page, Facebook now
occupies 17% of consumers’ PC time in the U.S.6
and accounts for one out of every five page views
on the Internet worldwide.7
While the millennial generation is driving the
social media revolution, older age groups are not
far behind. As of December 2012, over 50% of
Internet users in the 50-64 age group and more
than 30% in the 65-plus age group were exposed
to social networking (see Figure 1).8
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Feb ‘05 Aug ‘06 May ‘08 Apr ‘09 May ‘10 Aug ‘11 Feb ‘12 Aug ‘12 Dec ‘12
Percent of Internet users in each age group who use social networking sites
18-29
30-49
50-64
65-plus
All Internet users
Source: Pew Research Center’s Internet and American Life Project surveys, 2005-2012
Figure 1
Social Networking Site Use by Age Group

3. cognizant 20-20 insights 3
Advertisers Follow the Money
As content consumption moves online and onto
mobile devices, so do most revenue-generation
models. Players across the content creation,
marketing and distribution sectors have accepted
this tectonic shift and are adapting their
business models to favor online and mobile. As
the potential for subscription-based revenue
generation models for online content remain
limited (millennials,9
in particular, have grown up
on the Internet, believing content should be free),
companies see advertising as a means for driving
digital revenue streams.
Online researcher eMarketer estimated that
online ad spending in the U.S. would surpass print
advertising in 2012 for the first time ever, topping
out near $40 billion.10
By 2016, online spend is
expected to nearly double that of print advertis-
ing. In the broadcast marketplace too, online ad
spending will slowly catch up with TV ad spend by
2016 (see Figure 2).
A study of interactive marketing spend trends
over the next four years reveals the increasing
dominance of social and mobile. Social and mobile
spend is expected to grow at rapid annual rates of
26% and 38% respectively, while search advertis-
ing will plateau with an annual growth rate of 12%
(see Figure 3, next page).11
Most advertisers have already shifted focus from
search to social media. Even the biggest search
giant Google shifted to social, launched Google+
(to mixed reviews) and even integrated search
results. Facebook’s new social media search tool
Graph Search is expected to introduce a new
dimension to social media advertising.
Display advertising is expected to continue its
robust growth, the result of a more engaging
multimedia format compared with the pure text
format of search-based advertising.
Contending with a Revenue Disconnect
A painful realization of revenue challenges is
slowly dawning on traditional media and enter-
tainment companies that have plunged headlong
into the digital world (see Figure 4, next page).
Online content does not have the same revenue
potential per unit as print or broadcast content,
and mobile has even less. Here are some eye-
opening statistics.
A print newspaper reader is estimated to
contribute 18 times the value of an online reader.12
This is partly due to the fact that most newspapers
do not change for online content. But the bigger
reason is that an online reader is more likely to
go directly to a news article through search and,
hence, look at the ads on one page only, compared
with a print reader who notices ads on each page
of the edition while browsing. Part of the drop is
also because digital ads offer improved measur-
ability (in the form of impressions or click-through
rate) compared with print ads.
The news is not much better in the broadcast TV
space, with a viewer estimated to bring in three
times the value of an online viewer per episode.
Although online ads can be more expensive than
broadcast ads, given their ability to target the
right audience, the number of ads shown during
programs on the most popular online video sites
is approximately only 20% to 25% of what is
shown on broadcast TV. Many industry experts
believe Internet audiences simply will not tolerate
32
39.5
46.5
52.8
57.5
62
36 34.8 33.7 33.2 32.6 32.3
2011 2012 2013 2014 2015 2016
Online Ad Spending
60.7
64.8 65.6 67.8 68.9 72
TV Ad SpendingPrint Ad Spending
Source: www.eMarketer.com
Figure 2
U.S. Print, TV vs. Online Advertising Spend

4. cognizant 20-20 insights 4
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
$90,000
2011 2012 2013 2014 2015 2016
($M)
Social media
E-mail marketing
Mobile marketing
Display advertising
Search marketing
as many commercials as on TV, although the
hypothesis is still unproven.
One-third of heavy Internet users admit to
regularly pirating music and video content,13
pointing toward a gaping hole in monetization
strategy for online content.
Social media is not untouched by this problem.
Although major online giants have generated
ever-increasing amounts of advertising revenue
over the last few years, growth is mainly driven
by additional content consumption per user. The
rate of advertising revenue generation per hour
on major online sites has not risen significantly
over the last few years (see Figure 5, next page).14
Social media penetration of developed markets
has reached a saturation point. Most of the
growth in social media consumption in the near
future will be in emerging markets, such as Africa
and Asia, and on mobile devices, which offer
much lower monetization potential.
Mobile users are less inclined to absorb, or
even tolerate, ads on their devices. The chief
reason is the smaller screen size, which renders
non-essential information a nuisance. They are
also much less likely to click on hyperlinks on
mobile. Revenue potential per user on mobile
is expected to be limited compared with ads
delivered to personal computers. Facebook’s and
Twitter’s Sponsored Stories and Promoted Tweets
strategies, respectively, are more subtle than
display ads, and are believed to be more effective
with mobile device users.
While these strategies have been successful to
an extent, there is a long way to go before they
can match the returns offered by ads on PCs. For
example, in 2012, more people used Facebook
on mobile devices than on PCs for the first
$709
$46
$125
Print Online
Newspaper value per reader per year
Consumer Paid Advertising Advertising
$560
$170
Broadcast TV Online
Broadcast TV value per thousand
viewers per episode
Source: Beyond Content
Figure 4
Comparison of Value: Print, Broadcast TV, Online
Source: Forrester Research, Inc.
Figure 3
U.S. Interactive Marketing Spend

5. 5cognizant 20-20 insights
time in the company’s history, whereas revenue
generated from mobile accounted for just 23%
of total ad revenue.15
Even by 2016, mobile adver-
tising revenues are expected to account for only
15% of the global Internet advertising market.16
Impact on Media and
Entertainment Companies
Media and entertainment companies are expe-
riencing the following implications to their
business:
• Media companies that try to lift-and-shift
their revenue generation models from offline
(print, broadcast, etc.) to online platforms are
in for a rude shock. The revenue generation
potential of traditional streams (like subscrip-
tion, vanilla ads, etc.) is not the same in the
digital world.
• With the rise of social platforms and
app-based content consumption on mobile
and tablet devices, customers in the future
will be increasingly less likely to proactively
seek content (i.e., visit individual Web sites,
etc.). Instead, content needs to reach where the
customer is (on social platforms and mobile).
• Content consumption is moving from buffet
style to a la carte. Users will decide what they
want to consume; content creators cannot
push sundry material and expect to monetize
it (as with the traditional print and broadcast
world).
• The Internet is stripping media and enter-
tainment companies of control over how
their products are distributed. The Internet
disrupts their ability to create media scarcity
by delaying product distribution. This threatens
the fundamental profit engine of the media and
entertainment business. Case in point was the
furor over “read-it-later” apps, such as Read-
ability, Instapaper and Read-It-later, which
allegedly impinge on a publisher’s rights by
transforming written content, albeit for the
reader’s convenience.
• The lines between media types have blurred.
In a world of content consumption through
apps, the user will not know or care if they
are buying a movie, game, music track or
news article. Users will not pay for each type
of media separately but will pay for a uniform
experience delivered across all formats. The
silver lining is that apps can help push control
back into publishers’ hands.
• Media convergence is resulting in new com-
petitors, as well as collaborators, in the mar-
ketplace. As a news publisher now needs to
compete with a broadcast house, a music label
and a Hollywood studio to gain digital user
attention, it needs to work with technology
companies such as Apple and Google to take
its products and services to them.
• Virgin content with no social wrappers is
unlikely to engage the millennial generation
effectively. Today’s youth has Facebook and
Twitter in its DNA and is increasingly likely
to leverage social media in all aspects of
life – official and personal. While most Web
pages possess social sharing add-ins, media
companies need to devise ways of leveraging
social media to the next level. (Read our white
paper “A Brave New World of Connected Media”
for additional insights.)
Note: Includes Google Web sites; Yahoo! owned and affiliated Web sites
Source: Company and comScore data
Figure 5
Online’s Flat Line
GlobalAdvertisingRevenuePerHour
(MillionsUSD)
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
2007 2008 2009 2010 2011
Google
Yahoo! (total)
Facebook
Yahoo! (display only)

6. cognizant 20-20 insights 6
• Simultaneous multi-device customer
engagement is the new reality. 41% of tablet
owners and 38% of smartphone owners use
their device daily while in front of the TV
screen.17
Not only are they simultaneously
posting about the content they consume on
social media, but they’re also shopping and
looking up relevant program and product info.
Preparing for the Future
The following recommendations can help media
and entertainment companies move forward.
• Content:
>> The quality of packaging and delivery
will draw higher premiums. Traditionally,
the quality of content received the high-
est premium; however, the digital user of
today expects a feature-rich, personalized,
interactive and intuitive content consump-
tion experience. As a result, digital products
cannot be replicas of print and broadcast
products.
>> “Relevance” is the byword of the future.
Hybrid algorithms need to be devised to
suggest the most relevant content to a con-
sumer based on a combination of demo-
graphics, psychographics, social networks
and past consumption patterns across de-
vices and media.
>> Established media and entertainment
companies need to leverage the long-tail
revenue generation potential of legacy
content they have developed over de-
cades. When tied to relevancy algorithms,
legacy content can reap rich dividends.
• Distribution and delivery:
>> As users consume more content across
numerous digital devices, they expect a
uniform experience. While providing such
an experience, companies can provide new
subscription models, such as “pay once,
view anywhere.” Such subscription models
can extend beyond digital entities into the
print and broadcast world, as well.
>> Use of social media-based analytics will
drive targeted content distribution in the
future. Content delivery needs to change
from “one-to-many” to “one-to-one.” De-
spite privacy concerns, over 50% of con-
sumers worldwide are willing to provide
information about themselves online or via
a mobile device in exchange for something
of value — as long as it is transparent and in
exchange for perceived value.18
• Revenue:
>> As the revenue potential of each indi-
vidual medium decreases, media compa-
nies must create a far greater number
of avenues of revenue generation from a
single piece of content, as well as be open
to sharing the spoils with a far greater
number of partners (device manufacturers,
third-party app developers, media distribu-
tors, content aggregators etc.). Monopoly
over the revenue potential of content is a
thing of the past.
>> As pricing preferences of online and mo-
bile consumers are extremely heteroge-
neous, monetization models also need to
be customized for individual customers.
Companies need to find a balance between
making payment options as non-intrusive
as possible, yet simultaneously keep them
transparent.
Moving Forward
In our view, successful media and entertainment
companies will do the following:
• Know thy customer: From newspapers to
broadcasters to studios, a common thread is
emerging: the days of commoditized content
are over. Unless media and entertainment
companies endeavor to know what their
customers are thinking on a real-time basis,
they will gradually lose the ability to invest and
monetize relevant content and opportunities.
Tools have recently emerged that mine con-
versations on popular social media platforms,
as well as analyze user sentiment. Media and
entertainment companies can use these tools
to listen to the pulse of their audience. Hearing
the voice of the customer is important in every
industry, but for media companies, it is hyper-
critical. Companies that know what type of
content their customers are seeking stand a
better chance of delivering it to them quicker.
• Exploit “F-commerce:”19
Almost every brand
has a Facebook page today. Media and enter-
tainment companies should use these pages
for commerce (preview, order, checkout) and
not just information exchange. Examples
include companies such as BabyAndMeGifts.
com, Ettitude, Livescribe, etc., that are making
use of Facebook APIs to enhance e-commerce
offerings, structuring Facebook stores and
installing plug-ins to improve user experience,
as well as combining social campaigns with
F-commerce to extract the maximum benefit.
Various options include downloadable apps

7. cognizant 20-20 insights 7
that allow viewers to transact within a
company’s existing Facebook presence (e.g.,
Ecwid Payvment), catalog applications that
organize products but link back to an existing
online store (e.g., Storefront Social), integrated
e-commerce platforms that include extensions
for Facebook commerce (e.g., BigCommerce)
and tailored development environments for
Facebook commerce (e.g., 8th Bridge). Obvious
benefits are two-fold — reaching customers
where they are usually present and leveraging
social recommendations without the extra
effort of visiting multiple URLs and logins.
• Use the power of apps to provide innovative
solutions: Apps should be used to provide the
entire bouquet of offerings around a piece of
content to the consumer. Examples include
trailers, games, merchandise, etc. for a motion
picture. Targeted apps should be released
around a major product debut. Apps can also
provide customized offerings, building on
social data captured across platforms.
• Leverage emerging technology: Rapid tech-
nological advances are making the creation
of apps and cross-platform offerings easier
than ever before. Technological solutions built
around HTML5 can easily convert Web apps to
native apps on the fly. These have the same
transformational potential as blogs that revo-
lutionized e-publishing half a decade ago.
• Format data correctly: With the rise of content
aggregators and custom publishing apps such
as Flipboard, Pulse, etc., content creators
must ensure that their data format is flexible
enough to be picked up by all common aggre-
gating engines and publishing apps. Keeping a
close eye on companies such as Apple, Google
and Facebook that are driving the course of
software and hardware innovation is a must.
• Utilize a second screen: The level of social
interactivity on online articles (live Twitter
feeds, friend recommendations, etc.) can be
extended to the broadcast world through
second-screen apps. While consuming video
content on TV or the Internet, users can
receive a more interactive experience by
engaging in conversations with friends and
fans on the content. They can see what their
friends are watching, consume additional
content that is not available in broadcast mode
and even purchase content on the fly, based on
recommendations and downloads from their
network. Relevant algorithms, for example, can
be deployed to cross-sell related TV shows.
• Social care: Brands need more focus on
customer service via social media. Customer
feedback on social media is fundamentally
different from other modes, in that it has the
potential to change the perceptions (positive
or negative)of a large customer base in a very
short period of time. Customer care operations,
therefore, need to be tuned to listen and react
more closely with voices in social media.
Footnotes
1
Candice Schwager, “Bill Gates’ 1996 ’Content is King’ Has Reigned 16 Years,” Examiner.com, Oct. 30, 2011,
http://www.examiner.com/article/bill-gates-1996-content-is-king-has-reigned-16-years.
2
“The Digital Universe Decade: Are You Ready” IDC, May 2010,
http://gigaom.files.wordpress.com/2010/05/2010-digital-universe-iview_5-4-10.pdf.
3
Jemima Kiss, ”Digital Content Set for Growth. Oh, Except News,” The Guardian, March 31, 2010,
http://www.guardian.co.uk/media/pda/2010/mar/31/digitalcontent-research.
4
“Global Entertainment and Media Outlook on Internet Access: 2012–2016,” PricewaterhouseCoopers,
http://www.pwc.com/gx/en/global-entertainment-media-outlook/index.jhtml.
5
“Visual Networking Index,” Cisco Systems, Inc.,
http://www.cisco.com/en/US/netsol/ns827/networking_solutions_sub_solution.html#~forecast.
6
“State of the Media: The Social Media Report 2012,” Nielsen, 2012, http://www.nielsen.com/content/dam/
corporate/us/en/reports-downloads/2012-Reports/The-Social-Media-Report-2012.pdf.
7
“Facebook User Statistics 2012,” AnsonAlex, Feb. 20, 2012, http://ansonalex.com/infographics/facebook-
user-statistics-2012-infographic/.
8
Joanne Brenner, “Pew Internet: Social Networking,” Pew Internet, Feb. 14, 2013,
http://pewinternet.org/Commentary/2012/March/Pew-Internet-Social-Networking-full-detail.aspx.
9
”Millennials and the Future of Work,” Cognizant Technology Solutions,
http://www.cognizant.com/futureofwork/explore#!/video-videos/Millennials-and-the-Future-of-Work.

8. About Cognizant
Cognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process out-
sourcing services, dedicated to helping the world’s leading companies build stronger businesses. Headquartered in
Teaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep industry
and business process expertise, and a global, collaborative workforce that embodies the future of work. With over 50
delivery centers worldwide and approximately 156,700 employees as of December 31, 2012, Cognizant is a member of
the NASDAQ-100, the S&P 500, the Forbes Global 2000, and the Fortune 500 and is ranked among the top performing
and fastest growing companies in the world. Visit us online at www.cognizant.com or follow us on Twitter: Cognizant.
World Headquarters
500 Frank W. Burr Blvd.
Teaneck, NJ 07666 USA
Phone: +1 201 801 0233
Fax: +1 201 801 0243
Toll Free: +1 888 937 3277
Email: inquiry@cognizant.com
European Headquarters
1 Kingdom Street
Paddington Central
London W2 6BD
Phone: +44 (0) 20 7297 7600
Fax: +44 (0) 20 7121 0102
Email: infouk@cognizant.com
India Operations Headquarters
#5/535, Old Mahabalipuram Road
Okkiyam Pettai, Thoraipakkam
Chennai, 600 096 India
Phone: +91 (0) 44 4209 6000
Fax: +91 (0) 44 4209 6060
Email: inquiryindia@cognizant.com
­­© Copyright 2013, Cognizant. All rights reserved. No part of this document may be reproduced, stored in a retrieval system, transmitted in any form or by any
means, electronic, mechanical, photocopying, recording, or otherwise, without the express written permission from Cognizant. The information contained herein is
subject to change without notice. All other trademarks mentioned herein are the property of their respective owners.
About the Authors
Ashish Chawla is Cognizant’s Offshore Lead and Senior Director of the Information, Media and Enter-
tainment Practice within Cognizant Business Consulting. With 16-plus years of experience across the
publishing, broadcasting and online content chain, Ashish works with business leaders throughout the
industry to help their companies align strategy with business goals. In 1999, he launched the first multi-
lingual, multigenre video-on-demand network in Asia on the Singapore One broadband network, before
moving to mainstream technology-driven business consulting. He has also written papers on the content
supply chain and formulated the concept of return on content asset. Ashish blogs on social issues at
indianwhining.blogspot.com and can be reached at Ashish.Chawla@cognizant.com.
Shubham Choudhury is a Manager within Cognizant’s Information, Media and Entertainment business
unit. He has 8-plus years of business consulting experience across information, publishing, adver-
tising, market research and entertainment industries across multiple geographies. His areas of
expertise include solution envisioning, portfolio analysis, process consulting and business devel-
opment. A Certified Scrum Master (CSM), he also holds an M.B.A. from NITIE, Mumbai, India, and
bachelor of engineering degree in computer sciences from BIT, Durg, India. Shubham can be reached at
Shubham.Choudhury@cognizant.com.
10
Robert Hof, ”Online Ad Revenues to Pass Print in 2012,” Forbes, Jan. 19, 2012,
http://www.forbes.com/sites/roberthof/2012/01/19/online-ad-revenues-to-pass-print-in-2012/.
11
Robert Hof, ”Online Ad Spend to Overtake TV by 2016,” Forbes, Aug. 26, 2011,
http://www.forbes.com/sites/roberthof/2011/08/26/online-ad-spend-to-overtake-tv/.
12
”Beyond Content: Capitalizing on the New Revenue Opportunities,” IBM Institute for Business Value,
2010, http://public.dhe.ibm.com/common/ssi/ecm/en/gbe03361usen/GBE03361USEN.PDF.
13
Ibid.
14
”Facebook: The IPO Effect,” Ender’s Analysis, http://www.endersanalysis.com/download_report/494e576
62d3762d2f2h2d2f8b.
15
Michael Gordon, ”Facebook Finishes 2012 on a High Note: Q4 Revenue $1.585 Billion, $64 Million in Net
Income,” Jan. 30, 2013, http://www.engadget.com/2013/01/30/facebook-2012-q4-earnings/.
16
”Global Entertainment and Media Outlook on Internet Advertising: 2012–2016,” PricewaterhouseCoopers,
http://www.pwc.com/gx/en/global-entertainment-media-outlook/index.jhtml.
17
“State of the Media: The Social Media Report 2012,” Nielsen, 2012.
18
“Beyond Content: Capitalizing on the New Revenue Opportunities,” IBM Institute for Business Value, 2010.
19
The buying and selling of goods or services through Facebook.