Media Companies Driving Higher Revenue Efficiencies through Technology
The media and entertainment industry has seen a staggering amount of change in the last few years – one of the major trends is the industry consolidation as evidenced by Time-AT&T merger and other large M&A. The M&E industry is a profitable industry segment and has traditionally managed excellent profit margins relative to other industry segments - so they are always very attractive acquisition targets for large conglomerates.
The disruption of digital channels (Youtube, Hulu, Netflix) has also changed the way content is produced, distributed and eventually consumed – large studios are realigning their plans to accommodate the industry shift.
As the industry consolidates and disrupts at the same time, there is a significant undercurrent within the industry to reduce operating costs while managing to create the quality of content that has been expected of them. There is a greater need to understand the consumer behaviors and how we can systematically tailor content to cater to consumer – which has led to significant IT investments in the world of cloud computing, machine learning, digital analytics. In a world where elections, democracies and larger macro-events are influenced by social media, the M&E companies are embracing the world of information analysis like never before.
In the M&E world “Content is king” and while the technology and the industry is changing at a fast pace, if you happen to meet people engaged in the upstream part of content acquisition, you are very likely to find that they continue to be saddled with inefficient and unwieldy processes. There is a crying need for technology driven process simplification and in the paper we will focus on how the M&E companies are simplifying their contractual process around content acquisition, talent management, license and distribution and using the data within these processes to drive better revenue efficiencies.
Contract Management in M&E
Contract Management is a key process in M&E Industry’s value chain. All key players involved in creating, producing and delivering content such as producers, cast, crew, transportation providers, production shoots, catering etc. need a contract. And that’s a lot of contracts for producing one 2-hour movie or a 13-episode pilot season of your favorite show. In fact it is very common to have the pilot season of a show to have hundreds of contracts created before the show sees the light of the day.
Unfortunately, the contracting process is plagued by inefficiencies – contracts are complex, manual, inconsistent and produce very little analytics. Due to the same, the studios are unable to negotiate the best talent or talent fees (talent contracts), efficiently procure production services (vendor contracts) or distribute the content effectively (license contracts). Also the industry goes to all lengths to protect their “magic sauce” of content creation – thereby compounding the inability to automate these processes.
The good news – the industry is on the cusp of change; the recent IT trends in cloud computing and digital analytics provide the ability to design wing-to-wing processes for the industry.
How can IT Help?
Despite the qualitative nature of M&E production processes, there is a goldmine of data that can be mined. Using cloud computing platform like (AWS, Salesforce, Microsoft), companies are able to integrate all the key entities of the M&E ecosystem (production companies, networks, artistes, attorneys) into single system.
Contract Lifecycle Management (CLM software) providers, typically delivered in a Cloud or SaaS (Software as a Service) model, have evolved now to provide the ability to efficiently draft contracts, structure contracts better and drive them to closure. All executed contracts then become a great source of analytics driving simplification of procurement, delivery and consumption of the content - these are the industry practices so prevalent in Manufacturing, Banking and High Tech – to produce a “factory-line” approach for processes; that Media has now started to use.
The IT solutions provide end-to-end capability for production executives to manage their contracts and payments
1. Attorneys to draft complex contracts intuitively by using a “user-friendly” wizard
2. Complex, legal constructs can be built into formulae and algorithms
3. Allow for legal team to maintain a universal library of clauses, gives, amendments
4. Automate contract lifecycle from draft to fully executed copy with approvals, e signatures
5. Extract data from analytics to drive payments, project budgeting and other executive decision-making.
In some of the recent projects, we have seen the leading M&E companies adopting the identified approach–and, an industry notorious for operating using paper, fax machines and field cabinets in hallways, is finally waking up to the world of cloud computing.