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Consumer Outlook: Fee-based Content Academic Presentation

Consumer Outlook: Fee-based Content Academic Presentation. Graduate Capstone in Technology Johns Hopkins University Fall 2001 . Charlie Jones Inbar Tissona Kristen Waller Drew Gascoigne. Agenda. Introduction and background The project scope Methodologies used Our findings

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Consumer Outlook: Fee-based Content Academic Presentation

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  1. Consumer Outlook:Fee-basedContentAcademic Presentation Graduate Capstone in Technology Johns Hopkins University Fall 2001 Charlie Jones Inbar Tissona Kristen Waller Drew Gascoigne

  2. Agenda • Introduction and background • The project scope • Methodologies used • Our findings • Our recommendations • Who we are • Questions

  3. The Project • Who is Hughes? • What is the Project About? • Identify premium content opportunities (current and future) and explore the associated business problems and issues (competition) But First A Movie!!!!

  4. Introduction • What did you think about the movie? • Was the quality good? • What about the editing? • How was the synchronization of the sound to the video? • But What about the content?

  5. Introduction • Content is the center of your universe!!! • Availability • Legal issues • Selection • Ease of use • Technological constraints • Time, time, time

  6. Project Scope

  7. The Research Questions 1. Who will pay? 2. What content will sell? 3. What is the optimal programming mix? 4. How much can you charge? 5. What the people really want? 6. Who are your partners and competitors?

  8. Product Price Promotion Place Project Approach The business question 6 research questions Compliance Matrix 45 survey questions Online Offline Focus Group

  9. Project Methodology MS Access Database Primary Research 45Q’s 45Q’s Graphics Graphics Secondary Research Industry Research Industry Analysis The Final Product Primary Research Focus Groups

  10. Project Results Who will pay? • The Internet Community • Gender • Age • Income level • Ethnicity • Internet usage trends

  11. Project Results Who will pay?

  12. Survey Group Focus Group Project Results What content will sell?

  13. Project Results What content will sell? The Obvious: • News • Financial Information • Contemporary Movies • Sports • Music and Concerts • Gaming • Children’s Programs • Adult content

  14. Focus group Survey group • News • Financial Information • Contemporary Movies • Sports • Music and Concerts • News • School/research • Shopping • Finance • Sports Project Results What content will sell? Top 5 Priorities!

  15. Project Results What content will sell? The Not So Obvious: • DIY • Travel Channels • Cooking Channel • “The 10 minute Chef” • Contemporary Channel • Education/Research • Foreign News and Entertainment

  16. Project Results What is the optimal programming mix? • It’s all in the wrapping • Differentiation!!! • Menu driven content • Offer categories, but: • Let People Personalize their content • Don’t lock them into long term contracts • Maximize your content • Offer the extreme • Offer the Unusual

  17. Project Results What is the optimal programming mix?

  18. Project Results How much can they charge? • If Hughes builds IT, they will come • BUT………… • $5 for a PPV - Unicast • More for Sports Packaging -$40 for NCAA Tournament • More for a Season - $15 for Season 4 of Seinfeld • $15 Monthly Package Pay Option – Multicast • Monthly unlimited downloads • Subsidize the Installation & the HW – pay $65 monthly • Network Access, ISP services, premium content and HW

  19. Project Results Recommended Pricing Methods

  20. Project Results How much can Hughes charge?

  21. Project Results What the people really want? • Now They’ve built IT, how do you fill the seats? • IF … • Timely – No longer than it takes to get a movie from Blockbuster • 24 hours for Niche Content • HIGH quality • HIGH reliability • Portability of the material • The Couch Potato Syndrome • Give it to me at work • “Don’t get rid of my Email” • Bundle your service

  22. Project Results What the people really want? “ My computer is not the same as my 51” big screen and certainly not as comfortably placed as my couch” “ I would pay $5 if it was TV quality video and audio and the download was quick” “ I’d be more interested if I could get a packaged deal with TV included, then I would pay $65” “ I would subscribe for a short period of time if one of the options included access to reference material for school” “ I would only pay for current movies not yet available and Local sporting events that were not televised”

  23. Project Results Who are their partners and competitors? • Think fast the clock is ticking….. • Bandwidth wins!!!! • Partners: • Disney • Viacom • Your current merger • Competitors: • AOL/Time Warner • Verizon

  24. Project Results Potential partners? • Disney – #2 Media Company • $25 Billion annual revenue • ABC, ESPN, Touchstone, Hollywood Pictures, Miramax • #1 in Sports and Children’s Content • Needs an ISP • Viacom - #3 Media Company • $22 Billion annual revenue • CBS, MTV Networks, Nickelodeon, BET, Paramount, Blockbuster • They own the rights to your content • Needs an ISP

  25. Project Results Possible competitors? • AOL/Time Warner - #1 Media Company • Largest Internet provider – 31 million subscribers • Netscape, CompuServe • Possible Sony Partnership • Combined customer base of 130 million • Strong distribution backbone through cable • Verizon - • Largest DSL provider – over 1.2 million subscribers • Bundled services • $65 billion annual revenue • Strong Backbone

  26. Project Recommendations • Use what they’ve got • EchoStar Merger – 2nd Largest Satellite Provider • 1 Mb to 1500 for $1 • 90% control of domestic satellite market • Don’t forget about the obvious • Give me current Internet functionality + Premium Content • Don’t forget about the not so obvious • DIY, Cooking, Travel, Education and Contemporary Channels • Think about bundling services • Don’t compete internally • Use the DirecTV Brand recognition

  27. Project Recommendations • Partnerships are the key • Use satellite to their advantage • Capitalize on what others have and don’t have • Be cognizant of the legal ramifications • Napster evolving into Morpheus • Remember Packaging and Pricing • Menu driven • Short-term contracts - monthly

  28. That's All Folks!!! The Project Team Who are we?

  29. Questions???

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