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Ericsson Shares its Media Vision 2020

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4/8/2014
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STOCKHOLM -- In the year 2020, the global landscape will include 9 billion people, over 8 billion mobile broadband subscriptions and 1.5 billion homes with digital television, with analog almost history. The vision of the Networked Society will be realized as more than 50 billion connected devices, of which 15 billion will be video-enabled, will rely on mobile IP (internet protocol) networks dominated by video.

This is the picture of a new era of entertainment and connectivity that Ericsson (NASDAQ:ERIC) is painting in its new Media Vision 2020. Ericsson’s strategic view of the future maps how the TV and media industry will evolve over the next six years and shows that the TV industry will be worth $750 billion by 2020.

The Media Vision 2020 project is based on more than six months of research and brings together the concerted efforts of hundreds of people from across the global Ericsson organization. It includes statistical data, detailed surveys, and interviews with individuals, focus groups, industry participants and consumers.

Included in the vision are key beliefs and assertions, the timing and application of which will vary based on infrastructure and economic development in different regions. In advanced markets, such as Western Europe and the USA, by 2020 it is foreseen that:

1. The Networked Society is realized – 15 billion video-enabled devices are connected to broadband IP, transforming the consumption experience of TV. Mobile broadband is essential in all regions and fundamental in emerging regions.

2. Bundling of content and services remains the ultimate opportunity – Consumers will value simplicity and perceive value in a single bill. However, the essential need for broadband will enable separation of propositions from broadband access and content

3. OTT delivery for all - Delivery of content over-the-top becomes applicable to all TV service providers or content owners as a way of reaching consumers, and enhancing established broadcast delivery platforms

4. On-demand has risen to parity with live/linear – IP will have accelerated the ongoing shift of consumers to embrace the convenience of on-demand access to content to 50 percent of their consumption.

5. New entrants bring new investment – The acceleration of broadband capacity and penetration, along with ever more connected devices potentially enables a powerful device or social ecosystem to become a premium TV aggregator

6. Market revenues have grown to $750bn – up from $530bn in 2013. The distribution of revenues however shifts between content owners, broadcasters, TV service providers and network providers, especially as brands adapt advertising focus.

“The future is not certain, but the direction and trends are clear. The rules of TV are changing and it is essential for our customers to evaluate their strategies for success,” says Per Borgklint, Senior Vice President and Head of Business Unit Support Solutions, Ericsson. “The hope is that by sharing our Media Vision 2020 and the Game Changers, and offering our truly unique insights, capabilities and leadership that the media industry overall will achieve success and delight consumers well into the future. We have combined our broad understanding and expertise of the TV market, alongside extensive, quantifiable research to help our customers address the challenges and opportunities in this rapidly evolving ecosystem.”

In order to enable the industry players to leverage this vision and build strategies for success to 2020, Ericsson has distilled what it calls the Game Changers that are the most influential drivers and enablers of disruption, opportunity and change and will be highlighted in a series of reports throughout 2014, include:

  • ‘Forever evolving experience’
  • ‘The IP imperative
  • ‘Brand-casting’
  • ‘Changing consumption models and bundles’
  • ‘Cloud and web approach to TV’
  • ‘New money, new players’

    Ericsson AB (Nasdaq: ERIC)

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