No Surprise: It's All About Digital in the Media Business
CNBC Media and Entertainment Reporter
In 2013 the media Industry will be all about going digital.
Media giants will invest in web video, as marketers look to DVR-proof ads.
The media giants will jump on an explosion of original web video. With Time Warner taking a stake in web studio Maker, and game-oriented Machinima expanding and preparing for a potential IPO, we'll see these next generation studios draw more advertising dollars and more eyeballs on Google's YouTube. The traditional media companies will double down on efforts to deal with the fact that everything—other than sports and live events—is threatened by DVR and the explosion of other content options. And those sports costs will continue to skyrocket.
Distribution wars: content anywhere, anytime, with any model.
Consumers will benefit from an unprecedented number of companies fighting to distribute content. Joining veterans Netflix and Hulu, Amazon will push to sell its unlimited streaming "Prime" offering, Microsoft's Xbox will expand into selling video, and Apple's iTunes could even offer an unlimited streaming option. Even Verizon's "Redbox Instant" and Wal-mart's Vudu will push for a piece of the distribution pie. Next year media companies will cash in on all this competition for their content. But beyond 2013, when these players duke it out, some of them won't make it.
The music industry gets its mojo back.
The music industry will be new and improved, as Apple innovates, launching "iTunes Radio," a Spotify-like service to keep up with that fast-growing competitor. They'll be joined by Microsoft, which will want to grow its new Xbox Music options and Google's music store. All these options will add up to more revenue for artists. Some of the biggest names will go rogue and keep control of their music distribution – like Taylor Swift has — to make sure people buy songs instead of just streaming for free, with lower-margin ads.
Publishing industry shakeup yields fewer, stronger players.
The book and newspaper publishing world is heading toward shakeup and consolidation. With Rupert Murdoch spinning off his publishing assets, he'll shop for acquisitions — like the LA Times and Chicago Tribune. And on the heels of the Random House and Penguin merger, expect more publishing houses on the block, as media giants look for economies of scale in an e-book world.