The Olympics Meet New Channels of Distribution

08%20Olympics.jpgThe shift to digital content deployment represents the most rapidly advancing and impactful distribution change in the history of business. Many, as this article will show through the example of NBC's Internet broadcasts of the Olympics, are embracing the shift while a large number of other businesses are wrangling to adapt because of perceived risks and more critically the requirement for their leadership to actually think anew about extant business models. Failure to quickly adopt these new methods of customer interaction will result in catastrophy for many organizations while other competitors pass them by. This is even more true forcompanies that rely largely on the deployment of digital media content. The 2008 Olympics is illustrative of this point. Just two years ago during the 2006 Turin Winter Games, NBC streamed only one hockey game online. This year, the network will stream 2,200 hours of 25 events live. In only two years time the shift occured. Imagine what the next two years will bring.

The rapid pace of advancement for the new channels is occurring from a combination of factors. There has been a significant recent change is the amount of video organizations can put online. YouTube is the lingua franca of what's happening on the Internet, and has expanded enormously in the past two years. In addition the consumer’s appetite for content has changed. It’s no longer about just putting content online. Consumers now demand and expect transmission onto mobile devices and the ambition for enlightened organizations is to be able to reach as many viewers as possible. Video player technology is also much improved today, processor connections and network connection feed is much better and this will continue to improve at a rapid rate. In the end the biggest driver are consumers who have been exposed to online video and digital content and are increasingly expecting it.

Depite the obvious, many organizations are failing to proceed with the adoption of these new channels because they cannot reconcile the perceived threat these new channels entail to their existing business models. However, time is their enemy. They are the buggy whip makers watching the Ford production plant spit out the first fleets of cars from afar. Leadership of these businesses naively believes that the cannibalization of current revenue streams is not worth the risk of moving into the future. The tragedy is that because of this thinking, these organizations are not even preparing for just how rapid this change will occur. Because of their failing to accept the inevitable they will be ill equipped to catch up when the avalanche of consumer demand reaches a “tipping point”, which it has. Just think about the NBC Olympics example. This is a company whose revenue model is nearly exclusively surrounding digital content deployed on television and they are embracing the risk, because they know they have to.

Research shows that if you look at households with children, there are more laptops than televisions in the house. The way young people and increasingly older people are approaching the world, seeing technology as a tool, is changing things very quickly. Failing to embrace this change in your organization is a prescription for obsolescence.