Authors: Bala Balakrishnan, Global Advisory Leader for Cable and Satellite Sector, EY, US; Sakshi Trikha, Associate Director, Global Markets — EY Knowledge, India
Several posts in this blog have talked about managing change and achieving goals amid disruption. These are core skills for CIOs – with change in most industries fueled by technological advancements. The telecommunications, and media and entertainment, industries are no exception – they are undergoing a significant transformation driven by rapid improvements in technology, changing consumer habits, the rise of new competitors and changing business models.
In the multichannel video programming distributors (MVPD) sector, technological advancements have improved the capability to deliver vast sets of content; smart devices have reshaped consumer consumption patterns, and technology and telecom players have entered the sector, increasing competition.
MVPDs are increasingly integrating other capabilities into their portfolio and forming deals with players from other sectors to gain new markets. Policy developments and consumer acceptance of net neutrality are also shaping MVPD capabilities and business models.
Staying ahead in a changing sector
To stay relevant in this dynamic industry, MVPDs have the option of both commoditizing their services and focusing on continually optimizing their cost structure – or reinventing themselves with a reimagined set of product portfolio and service capabilities. Adding new businesses, revenue and operating models and technology are key enablers of any reinvention. So the CIO can be a critical player in this transformation:
- Reimagining products and services: With the changing landscape, a number of future products and services could be technology-based, including those connected by the internet of things (IoT), such as smart home and tele-health for example. MVPDs may also need to augment their top line with new revenue streams, such as personalized service bundles or targeted advertising. Technology and the CIO can to be at the center of all this change. To provide services that are beyond the core portfolio of MVPDs, CIOs can leverage partnerships to co-develop customer offerings. This opens the door for MVPDs to be super-integrators of all content, seamlessly delivering services across entertainment, communication, and home and life management.
- Creating agile business models: Agile business models can help MVPDs to compete effectively and CIOs must prepare and develop their organizations for change. This can include instituting technology capabilities that enable MVPDs to offer more flexibility to customers, e.g. by allowing them to design and modify their own bundles, watch preferred advertisements and manage spend across the various services they consume. CIOs can help by building robust big data and analytics tools to gain relevant insights about customer choices and behaviors. These insights can be used to customize offerings to micro-segmented consumer bases, to enable customer acquisition, retention, value and profitability management.
- Transforming customer experience through appropriate interface and design: Effective customer management can differentiate the leaders from the followers. MVPDs may have to evolve from providing customer care in silos to a more integrated customer experience management approach. CIOs can help deliver more value to customers through enabling a relevant and smooth customer interface. Segmenting customers to identify the brand promise of each segment and establishing the right capabilities for effective value exchange, facilitates the customer experience at each touch point.
What can determine success in times of change is the ability to evolve with the change. CIOs have an important contribution to make to assist MVPDs to not only face the change, but also to evolve and grow with it.