Yoel Zanger, CEO Giraffic
The explosion of digital entertainment took Hollywood by storm, supported by technology innovations disrupting the way people consume content. We are facing exciting developments in both entertainment and technology industries, especially when it comes to what happens when those two intersect. Last week, in partnership with AlmaLinks, Giraffic hosted the first delegation of The Digital Entertainment Group (DEG) in Israel and I had an opportunity to moderate an intimate round table discussion between the Israeli high-tech and Hollywood executives- Mike Dunn, President, Worldwide, Twentieth Century Fox Home Entertainment, John Penney, Chief Strategy Officer, Starz and Amy Jo Smith, President, DEG. A team of promising and innovative companies in the sphere attended the meet up, including Catch Media, eTribez Jinni, Kaltura, LiveU, PlyMedia, RR Media as well as representatives from both corporate and private venture capitals such as Samsung Ventures and TerraLabs Ventures.
We discussed the new technologies within the storytelling context, as 4K and new mediums like VR being embraced by the leading Hollywood studios to provide viewers with more vivid and immersive experiences.
The distribution of the content itself and developing more personal relationships with consumers are definitely the key focus areas right now. Today, content creators are utilizing traditional models of distribution and performing content delivery optimizations that include multiple CDN strategy, Pier-to-Pier technology implementation, as well as investing massively in tracking user experience and the efficiency of their infrastructure. Delivering the content in a proper way as well as being able to track consumer engagement, within traditional methods, becomes very expensive, thus the networks and the studios are looking into gaining more abilities taking the content to the ‘edge’ and into new solutions that will deliver better experiences in a more cost efficient manner. There is a lot of emphasis put on engaging with consumers and maintaining an on-going and direct conversation with the viewers. The goal, as it seems for now, is to develop personal relevance of the content by gaining deeper understanding of audience habits, how the content being experienced and the correlation with demographic and psychological characteristics. Basically, companies like Fox and STARZ would like to understand their consumers in a very comprehensive way in order to be able offering their viewers only the content that they know will be interesting and valuable to each viewer.
Combining a better understanding of the consumed content (at the point it being consumed by the user) with contextual data available, like time of day, location etc., is a key to shortening the time it takes the user to decide what he prefers to watch; Semantic technology was identified as the best practice to accomplish that goal as opposed to collaborative filtering, that is very successful for e-commerce but lacks the personalization level that is required in the entertainment industry. Semantic technology allows the understanding of content being consumed and does not treats the data as one block, therefore will allow more personal relationship with the viewers, based not only on their interests but on their interests at the certain point of time, thus giving the opportunity to content providers recommending the most relevant content to their viewers.
The OTT availability of the content is shifting gears in Hollywood and there are a lot of ‘direct to consumer’ initiatives as well. For premium networks in US it is challenging nowadays to expend their OTT subscriber’s base, due to high costs of traditional cable bundles (as the consumers charged extra for premium channels) and the variety of OTT providers like Netflix, Amazon and Hulu that reduce the consumers’ willingness to pay for additional services. However, the regions with less OTT alternatives, expensive satellite/cable bundles and less expensive content rights are more attractive for streaming services development investments, despite the content delivery infrastructure challenges. The US is just getting too crowded.
What was very clear is the interest of major content creators to set their sights on the next evolution of entertainment and consumer engagement by pro-actively developing tech relationships to support their activities. There is a big interest in locating new technologies that will be able to provide innovative solutions to industry’s challenges/problems- due to the large scale of the industry and its complexity, even a small improvement in content delivery process or in understanding consumers can be translated into millions of dollars. Hollywood industry has very limited visibility to the start-up community in Israel. We discussed several ideas on tightening the collaboration between the Israeli tech and Hollywood. It will be really exciting to see where this path will take us and I am looking forward for all the great things that can be accomplished by those two industries working together.
I would like to take this opportunity to also thank GHK Law, Tel Aviv for hosting us in their amazing offices with a spectacular view.