New Media Supply Chain 01.24.09

GBS Supply Chain Management Practice

THE Green, Lean, Intelligent, Digital, Enterprise SUPPLY CHAIN

DJ Everette

“Ideas Without Implementation Are Useless” – Peter Drucker


CONTENTS

•New Media Digital Convergence

•Digital Media as the Organizing Principle

•New Digital Media Supply Chain Management Opportunities

•Examples of Early Adopters with New Digital Media Supply Chain Projects underway

•Summary/Recommendations for Action

•Benefits: cost savings, improved efficiencies, increased innovation

•Glossary

OBJECTIVE Exploration of the revolution in the traditional supply

chain


Advertising Providers A shift beyond advertising is a result of consumer adoption of new distribution formats, advertiser spend shifts, game-changing new entrants and ongoing digital migration.

Companies with Converging Business Models Link to The Internet & Push to the Edge

Media Network Providers: are transforming their business models, driving services with rich content.These new ways of working, socializing and using information are only possible with the combination of 3G mobile and high-speed communications services.

Information Providers -business moving at the “speed of now,” users require On Demand access to information anytime and anywhere.

NEW MEDIA Content Providers: includes Digital, Networked Information, Computerized DVD, Blu-ray Disc and Communications Technologies in the emerging Telemedia marketplace.

INTERNET

Advanced Technologies Providers :Mobile, TV, Computer, Terminal equipment, software developers, media content providers, ISP’s, etc.


TIME TO MARKET is critical for companies. Shaving weeks off a product launch or new marketing campaign, getting resources up to speed and grounded for action, can mean millions of dollars in gained opportunity in many industries. ADVERTISING IS A HUGE PIECE OF THIS.

Applications: i.e. IBM’s Smart SOA Widget

STORAGE AND REPURPOSING CONTENT FROM PRODUCTION TO PLAYOUT IS AT THE EYE OF THE TORNADO.


A NEW LOOK AT DIGITAL MEDIA & IBM’s SUPPLY CHAIN MANAGEMENT SERVICES IS STRATEGICALLY IMPORTANT TO IBM.

For global enterprises, branded digital media content - product documents, multimedia, brand-related photography, graphics, presentations, video - is core to business process.

Managing the digital media supply chain from creation to delivery to the Enduser can have a dramatic impact on a business agility and ROI.

IN ORDER TO DO SO, A RE-EVALUATION OF TRADITIONAL SCM SOLUTIONS IS REQUIRED


IBM’s Traditional Supply Chain Consulting and Systems Integration Services today excludes Consideration of Digital Media Paradigm shift.

Supply Chain

Strategy

Supply Chain

Strategy

Program Management

Change Management

Product Lifecycle

Management

Product Lifecycle

Management

Supply Chain

Operations

Supply Chain

Operations

Procurement

ProcurementLogisticsLogistics

Supply Chain

Enterprise Application

s

Supply Chain

Enterprise Application

s

Supply Chain

Planning

Supply Chain

Planning

PLM:• Virtual product introductions• Market planning• Portfolio & pipeline management• Telematics• After sales service

Supply Chain Planning:• Demand mgmt and

communication• Inventory management• Sales & operations planning• Collaboration or CPFR• APS implementation

Procurement:• Strategic sourcing• Supplier

enablement• Supplier

integration• E-procurement• Leveraged

procurement services

Supply Chain Operations:• Revenue & pricing optimization• Extended order mgmt• Enterprise asset mgmt• Supply chain architecture• Mfg execution systems

Logistics:• Performance

improvement• Collaborative fulfillment• Inventory management• WMS implementation• TMS implementation

Supply Chain Enterprise Applications:

• ERP selection• ERP implementation• ERP integration• ERP extensions• Application

Management Services / Outsourcing

Supply Chain Strategy:• Scenario planning• Business model design• Governance (global, regional and local)• Network and infrastructure optimization• Customer service strategy development• Transformation roadmap development

SCM WORKING AT A TRANSACTIONAL/PHYSICAL LEVEL TODAY –DIGITAL CONTENT NEEDS TO BE INTEGRATED INTO E-E PROCESSES


Production & Licensing

Aggregation&

PackagingContent Distribution*

Online Portal Provisioning

Transportation & Delivery

Device Management & Support

Major Studios dominate/Telco has no experience

Telco buying skills

Distributors of content include web-based providers like Rhapsody/YouTube/Apple iTunes/ Zune.

Online Portal & Search: Google, Yahoo, MSN, eBay, Amazon, MySpace dominate this space) Telcos have ceded by divesting Yellow Pages, but can be recovered.

Telcos dominate, but increasing competition. This also includes billing companies and technology providers, as well as Network Operators.

Telcos manage subscribers and defending this turf, which they control fully.

DIGITAL MEDIA IS THE INFORMATION ORGANIZATION PRINCIPLE

*Includes more than just Online –ie.Satellite, wireless mobile transmission.

CONSIDER THE WORLD ENVIRONMENT AND IBM TODAY


SOA MEDIAHUB ENABLED

•Customer Experience/BI Mgmt, (CS13) Service Quality Management, VoIP Management, Performance Management, Network Management and Security Management

Production & Licensing

Aggregation&

Packaging

•Content Services Mgmt (CS12) (AIS, S&C) Digital Media Management Workflow (transcode, DRM, Storage & Cataloging

TE

LC

OM

M

&E

•Service & Network Lifecycle Mgmt: (SCM, S&C, AIS) Network Lifecycle Management: support processes for planning, construction, maintenance and network inventory.

On Demand Content Distribution*

Online Portal Provisioning

Transportation & Delivery

Device Management & Support

•Supply Chain Visibility: (IS09) Supply Chain Management ERP•Supply Chain Collaboration•Virtual Command Center (VCC) Supplies Supply Chain Visibility

•Product Lifecycle

Management: (ISO1) Innovation Mgmt

•Digital Workflow Transformation (CS04) •News, Sports, Program Production; Broadcast Mgmt System, Enterprise Media Library; Multi-Channel Content Preparation, Post Production and Backoffice Transformation: F&A, SCM and HCM.

EL

EC

•Multi-Channel Management (MCM): (IS05) Sales Transformation/ Service after Sales

Illustrative Only.

EXISTING APPLICABLE SOLUTIONS FROM 2008 COMMS SECTOR INDUSTRY MAPS

*Includes Online, Wireless, Satellite, and various other distribution platforms linked to Internet

•Network Provisioning: (CS10) (AIS, S&C, CRM) Resource Mgmt, Activation, Customer Service Provisioning: Order Management, Planning & Design, Partner Management Order FulFillment

•Partner Integration (AIS, S&C) Partner On-boarding, Media aware content ingestion, exposure of network enablers

•Digital Consumer (CS20) Web-Centric Business Innovation; Ad Sales Transformation; Intellectual Property Management, Customer Care/Billing; Business Intelligence/Consumer Analytics

The New Digital Media Supply Chain E

&U

Cognos/BI Informed Decision making (part of

SAFE)

Enterprise Asset Management and Business process optimization

IMS: e-business Hosting Services (ebHS), SO Managed Midrange Server, Services, Delivery Partner Services (DPS), Application on Demand (AoD Infrastructure on Demand (IoD), Internet Security Services (ISS), Remote Management Infrastructure Services (RMIS), Akamai, Scale-out File Services (SoFS) ,Digital Media Event Hosting


•2004-6? Convergence Team – JoAnne Taylor – Responsibilities to explore the merger of solutions M&E/Telco. Based on funding, but got cut, but has many case studies to demonstrate the need, duplication of effort and working at cross purposes within the various industries.

•Consolidated E-E SCM thinking underway: 2000 – Present - Peter Guglielmino, Rick Dorion, Rick Koopman, Allan Parrish, John Hoehn, Amy Ayers, with high level discussions with Joe Selle.

•SPDE /Mediahub – Value Proposition Deck developed. SPDE not grounded in open standards environment. Mediahub fits well in this environment.

•Integration of SOA/Mediahub into Telco/M&E Solutions

•Global SME’s focused on M&E – Deeply knowledgeable about customer needs indicate valid.

CURRENT GAMING EVENTS: February Panel, Burbank CA entitled:“Creating Efficiencies in the Digital Supply Chain: From Development to Deployment” Developing, testing and deploying a game is a considerable process that requires partners to communicate effectively through not only the production process but also through the product lifecycle. Steve Canepa/Panelist

HISTORICAL PROBLEM: No Owning Organization in infrastructure to support

PREVIOUS IBM ACTIVITIES LENDING CREDIBILITY TO THIS POSITION

•See Examples Following – Demonstrating market needs are E-E and IBM is working on projects from a Supply Chain perspective.


IBM is participating and recently responded to an RFI from SPE -vision for the Digital Backbone (“DBB”) program at SPE is to use automated processes and technology to knit together several siloed work groups that exist today and develop a contemporary and economically viable digital end-to-end process. This new ‘backbone’ will be used by numerous SPE divisions and will be expected to significantly enhance productivity, flexibility and profitability of nontheatrical distribution operations. SPE’s new DBB environment can help the company become more agile and responsive in addressing the rapidly changing demands of the global distribution environment, the need to reduce labor costs for repetitive and non-creative tasks, the need for greater collaboration and integration both within and external to SPE and the challenge of fierce global competition In today’s challenging financial environment investments in technology cannot be made just for technology’s sake, but that real economic benefits must be delivered to SPE.

Example: Sony Pictures Entertainment – SPE Digital Backbone (DBB)

Rick Dorion, David Jensen, Allan Parrish, Doug Korte working this.


Example: MTV NETWORKS SUPPLY CHAIN

Tony DrummondFor one client, IBM mapped a “future vision” digital workflow…

Flexible, Scalable Environment

•Business process not constrained by technology•Choreography for business process – flexible, easily modified to fit new business models•Abstract Service model offers straight forward technology substitutions for best-in-breed evolution•Transparency enhances process monitoring and performance managementWorkflow improvements provide a solid platform for additional

revenue growth and operational efficiency


Warner Brothers – Home Entertainment Group was developed for all business units involved in digital delivery of entertainment to consumers, according to Kevin Tsujiharo, President of this new division.

This is an ongoing Transformation Project moving WBHEG into the Digital E-E Business, according to Charles (Chuck) L. Dages, Sr. VP Emerging Technologies.

“As we increasingly see the use of digital cameras on the front end by film makers an digital distribution through Broadband, DVD, Blu-ray, & HDTV and knowing that there are pockets already digitized seen in most major production and editing processes. This new initiative enables global distribution over existing and new platforms. “

Warner was working with HP (as IBM’s DAM was not considered flexible enough and they chose to use a high performance storage system at the time).

Example: WBHEG Global Supply Chain Efforts Underway

Rick Dorion/Bill Maloney


John Havens: VP Business Development – GE Commercial FI “Business Models are changing the way people consume media.” Premise: New Technologies (Servers, Routers, HW) drive change as they end up in Service Providers Supply Chains.

2.5G Wireless Data Mobile

Carriers – PLC Equipment

(Supporting Cells)

TOWER OPERATORS

Internet

Satellite

Broadband

PDA

GE TECHNOLOGY VALUE CHAIN POC

BROADCAST

Example: GE Technology POC – New Media Supply Chain


Example: BHARTI TELEMEDIA Direct-To-Home (DTH) arm of Bharti Airtel

“We provided the implementation of a service delivery platform. Bharti was already a proponent and ‘believer’ of a virtualized architecture. IBM didn’t have to sell them on the concept, but only describe it… This is a Supply Chain Management Process, but we don’t call it that” – Peter Guglielmino


Australia’s National Screen & Sound huge AV Collection/Archives, preserves and makes the collection available to all audiences. Rights Management is a large part of this when it comes to digital content delivery.

Stills Ingest

Video Ingest

SANS Storage Area Network

MAVIS

On Site Exhibitions

Internet Delivery

LAN Delivery

Broadband Delivery

Audio Ingest

Example: Screen Sound Australia National S&S Archive


1. SCM Practice should address this new world imperative and invest resources to create a cross-industry revised Digital Media Supply Chain Consulting Service as a new revenue stream, using Digital Media as the organizing principle.

2. SCM should incorporate SOA/Mediahub into SCM Solution implementations to create E-E flexibility, speed, agility and improved business processes, not just for M&E but for all industries, as we move into the Digital Age, as well as increased emphasis on AutomationWF and Hosting Content Push.

3. SCM should leverage all appropriate sensors/actuators, intelligent Solutions & Cognos/BI analytics within the integrated Enterprise. Corporate directives for Smarter Planet long term strategy should be embedded in SCM Solutions now.

4. Special consideration should be given to documentation of manual processes via WBI or other appropriate software, especially within the M&E context, but applicable to all Comms Sector.

5. Traditional Supply Chain Management within IBM should be redefined to include not just business processes, but Content Production & Repurposing (DAM/MAM, etc.) media concerns, as well as escalating Need for Speed/Storage issues for all industries.

6. IBM’s Research should be leveraged in Nanotechnologies/Halographic Storage Solutions to capitalize on the growing need globally, cross industry.

7. Showing a rapid return on any investment, and quantifying the savings should be built into the New Digital Media Supply Chain from start-finish. Metrics should be collected as part of BAU.

8. An SCM Sales Kit should be developed for M&E which Identifies Pain Points from the collective verticals and maps them to Partners/ Technologies/and ID’s why IBM has unique position here.

RECOMMENDATION – NEXT STEPS


•Improves process efficiencies. Ingest and store high resolution content digitally and manage\move it seamlessly through post production and distribution across multi-channel platforms and multi-distribution channels.•Supports new revenue streams. Enable new business models leveraging digital studio content•Inspires innovation. Exploit technology, including client technology, to innovate digital workflows and inspire creativity•Promotes collaboration. Drive enterprise-wide operational efficiencies through participation and collaboration•Enhances customer services and relationships. Continue to deliver world-class servicing to internal and external customers•Speeds customer on boarding. Provides a compelling service to incent customers to accept client content in digital rather than physical form

RESULTS APPLY TO ALL GLOBAL INDUSTRIES IN THIS NEW DIGITAL AGE


THE END


For global enterprises, branded digital media content - product documents, multimedia, brand-related photography, graphics, presentations, video - is core to business process, and critical to marketing success. Managing the digital media supply chain from creation to delivery can have dramatic impact on business agility. As companies gain greater control of this content, with the ability to distribute it on-demand both within the enterprise and out to external audiences, the value of digital media greatly increases. Traditional print and online channels have already created a large challenge for global organizations to manage valuable content. New channels such as cell phones, PDAs and podcasting are sure to only add to the complexity - not to mention that these new media types are increasingly expensive to produce and manage.Integrating Digital Media Supply Chain solutions enable enterprises to control these costs, maximize the value of rich media assets and manage the digital rights to this content. These software applications handle the collection, management, and distribution of digital media. And today, many global corporate marketing organizations have adopted these solutions for their high return on investment.To make the business case, you need to understand the range of cost factors related to managing and sharing digital media. These often revolve around the time knowledge workers must spend manually performing many of the tasks that can be automated through intelligent software (i.e. DAM). Specifically, such cost factors can include time spent searching for appropriate content, recreating and duplicating digital media files, licensing and rights-management activities, handling requests for file conversions and fulfillment, maintaining archives and other administrative tasks.

A BUSINESS CASE FOR THE DIGITAL MEDIA SUPPLY CHAIN


When measuring ROI, a critical consideration is total cost of ownership (TCO):•For an on-premise solution, the TCO includes the costs of hardware, software, support, professional services and ongoing administration of the system. If separate business units can utilize the same solution for different applications, TCO is reduced by leveraging the knowledge and/or infrastructure gained through the first deployment. Each additional implementation, therefore, should account for a progressively lower TCO. •For an outsourced or hosted solution, while there are no direct equipment costs, you must factor in the ongoing monthly or annual fees. A significant benefit of a hosted model is faster deployment, which may allow you to take advantage of a market opportunity sooner, enable an accelerated product launch and realize increased revenue as a result. For example, if an internal deployment is delayed 12 to18 months due to infrastructure or other concerns and your ROI model proves returns are possible in six months, it makes sense to outsource and begin earning those returns sooner, even if the upfront costs are slightly higher. •Hard cost savings, business process efficiency improvements and the ability to take advantage of rapidly emerging market opportunities are contributing factors to ROI Understand that as digital media technology and usage evolve, there will be unexpected opportunities to derive additional value from your digital assets - and, by extension, from the solution itself. We need to capture metrics that demonstrate these points.

MEASURING ROI OF THE DIGITAL MEDIA SUPPLY CHAIN:


“NGOSS”:The term is generally used to depict the shift to higher network speeds using broadband, the migration from the PSTN to an IP-network, and a greater integration of services on a single network, and often is representative of a vision and a market concept. NGN, also defined as “broadband managed IP networks”, includes next generation “core” networks, which evolve towards a converged IP infrastructure capable of carrying a multitude of services, such as voice, video and data services, and next generation “access” networks, i.e. the development of high-speed local loop networks that will guarantee the delivery of innovative services. OSS is SWG approach.

BUNDLING: refers to the sale of a number of services combined in a single price package, usually excluding the possibility that customers can obtain a single service without taking or paying for the other services in the bundle. Bundling of services can help generate economies for the supplier through, for example, reduction in service marketing charges, customer acquisition costs, billing charges, duplication of effort (time, money, energy) or danger of cannibalization of our existing marketshare. For the client bundling often has the advantage in that prices are lower compared to having to subscribe to each service individually, however customers may not want all the services offered in a bundle. A client who does not want IPTV services may be obliged to pay for these services when subscribing to certain triple play bundles. At the same time a bundle, while nominally offering a better price than purchasing the same services separately, is also difficult to assess when trying to compare prices across a range of different offers. A service provider may also use a service in the bundle to cross-subsidize other services using this to obtain an unfair market advantage. Bundling may also make it difficult for regulators to define markets, assess market power, and therefore understand whether or not dominance exists in a given market.

NEW MEDIA includes Digital, Networked Information, Computerized DVD, Blu-ray Disc and Communications Technologies in the emerging Telemedia marketplace. Key customer segments include: Content Owners, Distributors, Aggregator, Integrated Operations (Fixed/Mobile), Mobile Operators (Pure Play), Home Broadband Providers, ICT Providers: BT Cable, Wireless, MCI, AT&T, Wireless, Internet Service Providers and Search Engine companies.

SOA/MEDIAHUB FRAMEWORK is full suite of WebSphere® products to create the SOA platform, including WebSphere Application Server, WebSphere Process Server and WebSphere Message Broker, which together form the architecture’s integration layer – the means by which different applications are made visible to one another and are able to pass data back and forth. By linking all of the company’s applications in this way via the SOA’s Enterprise Service Bus, information could be shared and processed across the entire company seamlessly. Serves business processes alone or, it provides a flexible platform for potential future uses such as management of the media itself

A Content Delivery Network or Content Distribution Network (CDN) is a system of computers networked together across the Internet that cooperate transparently to deliver content most often for the purpose of improving performance, scalability, and cost efficiency, to end users.

GLOSSARY OF TERMS:

Documents

New Media Supply Chain 01.24.09