2 business strategy - dcu school of computingasmeaton/mecpracticums2005/… · web view2.2...

Dublin City University Business School & School of Computing

Business Plan for Arbitro Participatory Media System

Authors:

Student Name Student Number ClassDarragh O’Flanagan 50552879 MECB

Robert Keogh 50506010 MECBOwen Edwards 90279921 MECT

Richard McDonough 54155291 MECT

Supervisors:

Supervisor Name AreaAlan Smeaton School of Computing

Des McLaughlin Business School

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Table of Contents:

Business Plan for Arbitro Participatory Media System 11 Executive Summary 4

1.1 Mission Statement 41.2 Market 41.3 Business Model 41.4 Business Highlights 41.5 Company summary 5

2 Strategy 62.1 Our Product 62.2 Business Strategies 62.3 Strategic Analysis – Using Porter’s 5 Force Model 92.4 Competitive Advantage 102.5 Business Model 112.6 Revenue Model 122.7 Targeted Customers and Route to Market 122.8 Risk Assessment 15

3 Market Analysis 173.1 Segmentation 173.2 Customers 183.3 Competition 193.4 Marketing 193.5 Survey 24

4 Operations Plan 274.1 Operations Strategy 27

5 Management and Labour Requirements 285.1 Salaries 28

6 Technical Report 306.1 System Overview 306.2 Web Services 306.3 E-Mail Server 336.4 SMS / MMS Gateway 336.5 Message Processing Server 336.6 Graphical User Interface 346.7 Competing Solutions 396.8 Competitive Advantage 40

7 Finance 417.1 Funding & Assumptions 417.2 Sales & Profits 423 Cashflow 2005-2006 427.4 Cashflow 2006-2007 457.5 Cashflow 2007-2008 457.6 Profit and Loss Account 46

Appendix: 47Appendix 1: Survey Questions Asked, Graphs & Tables of Results 47Appendix 2: Entertainment & Media Industry Overview 52Appendix 3: Population numbers (Ireland) 53Appendix 4: Mobile Phone Population (4000 users) 53Appendix 5: Interview with the Channel 6 media company 54

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Appendix 6: Broadcasters 56Appendix 7: Arbitro User Interface 57Appendix 8: Sample image of from video capture using XDA mobile device 57Appendix 9: Using MMS to create TV shows based on the success of SMS-TV shows. 58

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1 Executive Summary

1.1 Mission StatementWe aim to facilitate the general public in having an active role in news coverage, entertainment programming and to ensure adequate compensation for their efforts. We will assist media organisations by providing access to a previously untapped resource of content.

We provide a software system and service whereby the public can send mobile phone content to a centralised repository. Media companies can then use our software product to search this repository and purchase selected content.

Revenue will be created through the following: A license system where we charge an annual fee to use our product/service. We take a percentage of the sale price from each piece of content sold. The public pay us a fee, on top of standard network charges, to submit content

to our product/service.

1.2 MarketIn 2003, the 9001 million messages sent in the European SMS-TV market generated an estimated €400 million for broadcasters, mobile operators, and technology providers. It is estimated that this will be extended using MMS and picture messaging in 2006. Broadcasters could capture €250 million to €375 million from this market. Europe is the world leader in SMS-TV, and the market is growing. Studies suggest that, depending on the show's format, 5 to 15 percent of the total audience is converted from viewer to active MMS participant [see Footnote 1 or Appendix 9]. Current trends indicate that this will extend into other media areas such as news and entertainment broadcasting. Already, media organisations are searching for new ways of accessing new content2 and are broadcasting video content captured by the public. The market is edging more and more towards the inclusion of ‘Participatory Journalism’.

1.3 Business ModelThe business model is to license the service and product to media organisations. The license gives media organisations access to content captured by the general public. The user that captured the media will receive payment minus the commission that will be deducted by us. A premium will also be charged on the transmission of the content if delivered by MMS.

1.4 Business HighlightsRevenue for the 2nd half of 2005 will be €45,900. During 2006 revenue will be €268,322 with the expected growth rate at 5% per annum.

1 See Appendix 9: Using MMS to create TV shows based on the success of SMS-TV shows.2 See Appendix 5: Interview with the Channel 6 media company.

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1.5 Company summaryThe name Arbitro stems from the Latin arbitro -are and arbitror -ari , dep. (1) [to witness; to bear witness]. (2) [to arbitrate, judge, decide].

A company external to DCU is to be started-up. It is to be founded by the four Masters students. All four members will own an equal share in the company.

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2 Strategy

2.1 Our ProductCurrently many mobile phones have both video and image capabilities. These capabilities and the number of phones with them are expected to grow. With so many people with these devices and the growing number of media stations requiring up to the minute reports of incidences and events, images could be captured by mobile users and transmitted to the media stations. At present though, video / image messaging is stuck at the peer-to-peer level.

Our system will allow video / images to be sent to centralised repositories. The receiver will have processing software which collects the video / images and processes it. It is then displayed on the screen, along with statistics (e.g. Jim has sent 5 videos/images before this) and is ready to be purchased and broadcast. The camera phone allows people to act as mobile reporters where they send in video, which will be almost instantly available to TV stations for news reports, celebrity spotting or for police to be informed of crime scenes, etc. People can record incidents as they happen, in the hope that they will be rewarded for it if the video is purchased.

Our company will set the price of the video / images to be exclusively or non-exclusively purchased via the user interface. If a TV station decides to use the video / images exclusively, the piece of media will be marked as being exclusively used for a number of months so the piece of media won’t be available to other TV stations. The system will also be able to accommodate for searches of media based on features such as location. In the future, it is expected that camera phones will be able to record GPS coordinates in the metadata of the video / images. Our system will be able to translate these coordinates into place names and this will be stored alongside information on the video / images.

Basically our product will be a video and image recording service / platform which receives content from distributed mobile phone users. Users e-mail or MMS videos or images captured by mobile phones to a centralised server which processes images for use by media companies.

2.2 Business Strategies After receiving funds from Enterprise Ireland or from a suitable investor, our product will be fully developed and ready for the marketplace within one year. We have examined a number of different business models and we have chosen one that we feel is particularly suited to our product and that will also generate the greatest amount of

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revenue. Media organisations such as TV stations, production companies and the printed press would be users of our software and therefore purchase our licences. Bigger organisations will purchase more seats because they will have a more diverse their range of needs would be and the more employees they would need to research appropriate content.

We would use a license system where there would be a fee per year to use the system per seat.

Also for every video/image purchased, we will take a percentage of the sale price.

We generate revenue from the public sending MMS messages to us. They pay us a minimal fee on top of the standard network charges.

We will initially launch our product in both the Irish and the UK market at the same time due to the fact that media broadcasts in the UK are highly likely to be seen in Ireland and vice versa.

2.2.1 Sustainable Competitive Advantage Through Market Position3

Our competitive advantage will be based on a privileged market position gained through significant first-mover advantages in skills, infrastructure and market-specific relationships with customers. Our aim is to establish a “privileged”, hard-to-replicate, position, in an industry that will be unattractive to enter due to us gaining the majority of the market as the first-mover. The recipe for doing this comes from:

Right goals: focus on long-run profitability (e.g. this is the beginning of a new era for news, entertainment, etc.)

Clear value proposition: unique value for particular users/customers (e.g. the same features cannot be found anywhere else)

Distinctive value chain: same activities as similar companies but done in a different way (e.g. other companies use web sites whereas we use licensed software that will not have “down time” and also contains unique features)

Trade-offs: not try to be all things to all customers (e.g. can focus on certain profitable areas of a very broad market, such as news)

Activity chain: mutually consistent and reinforcing activities (e.g. using phones to transmit content will increase the interest in their use for usually non-technologically savvy people and therefore bring them into the frame)

Continuity of direction: keeping to the discipline of the strategy (e.g. future areas of development, such as branching out into the area of policing and using the technology to send and maintain crime data, will still require the same strategies)

See Sections 2.2.4 and 2.2.5 for more information on how we aim to maintain a privileged market position and/or competitive advantage.

3 “Assessing your strategic alternatives from both a market position and core competence perspective” by Prof. Brian Leavy.

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2.2.2 Blue Ocean Strategy4

We will create a blue ocean of uncontested market space. Red oceans represent all the industries in existence (the known market space), where boundaries are defined and accepted. Blue oceans denote all the industries not in existence today, where demand is created rather than fought over. We will create a blue ocean of “participatory journalism” from within the red ocean of defined, internal acquisition of media content.

No one else is currently providing the service we offer in the same way that we offer it. Therefore we will be uncontested in dominating our newly created market for purchasing mobile phone content. This new market (that we create) is our blue ocean, as we will be the only company within it when we launch the product/service.

Being the first-mover will mean creating a reputation that has the ability to last. Customers will be attracted to our reputation and may automatically use our known product/service because it is the original and best known.

The more customers that submit content and purchase it, the more likely others are to follow. Existing customers will not deviate from our company, as they will “stick to what they know works”.

This blue ocean will remain uncontested for as long as the market remains impenetrable or unattractive to others. The idea and technology may be copy-able by others but we aim to maintain a blue ocean with the aid of exclusive partnerships [see section 2.2.4] and intellectual property rights [see section 2.2.5].

2.2.3 The New Frontier of Experience Innovation5

Value is created for customers who submit content, through the experience of filming video, submitting it, having it purchased by a media company and then receiving a reward. The role of consumers is becoming more active in an increasingly networked society. Our product/service allows individual customers to actively co-construct their own experiences through personalised interaction, thereby co-creating unique value for themselves. They will achieve a feeling of satisfaction and pride from having their content visible to the public once a media company purchases and uses it. They will develop a sense of achievement, and of “winning”, through gaining a reward, which makes them more likely to repeat the process and recommend it to others.

2.2.4 Exclusive PartnershipsBeing the first mover will allow us to create partnerships with some companies who buy our product. This will mean that they agree to only use our system (and not use the system of possible competitors) once they purchase the licences. Therefore the market becomes less attractive to others and the barriers to entry increase for any possible future competitors. Not all companies will want to enter into a partnership but those that do will gain advantages such as having instant access to the latest

4 “Blue Ocean Strategy”, By: Kim, W. Chan, Mauborgne, Renée, Harvard Business Review, 00178012, Oct2004, Vol. 82, Issue 10.5 “The New Frontier of Experience Innovation” , By: Prahalad, C.K., Ramaswamy, Venkatram, MIT Sloan Management Review, 15329194, Summer2003, Vol. 44, Issue 4.

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content and all the archives. This will help us to maintain a privileged market position and/or competitive advantage by keeping hold of the business from certain companies. There will be fewer customers for any future competitors or they may even be discouraged from entering the market at all due to a lack of possible business.

2.2.5 Intellectual PropertyWe have already consulted Tomkins who specialise in patents and licenses. We are going to proceed with the process involved in protecting our product/service. As of the time of writing, we are still undergoing this process. Tomkins need to view the product/services on offer and make a detailed judgement on what exactly we can gain intellectual property rights on. If possible, we will also trademark our company name and any other distinguishing names involved with the product.

Provided we gain intellectual property rights, they will act as a deterrent to anyone wishing to enter this market. It may block others from entering the market place or make it less attractive. This will help to maintain a blue ocean of uncontested space or to maintain competitive advantage if competitors do enter the market.

2.3 Strategic Analysis – Using Porter’s 5 Force Model6

Rivalry among existing competitors: Local Irish market has no known direct competitors. The UK market has

some similar competitors (direct and indirect) but they operate in different ways to us and do not provide the ability to transmit instantly via mobile phones (instead they use e-mail). They also do not provide varied content for any interests other than news or advertising.

Switching costs are high as the money invested in acquiring the application is lost, the relationships that are created are dissolved, and the pool of existing and future content is lost.

A good or established reputation is hard to compete against, making it difficult to compete against our company who are the first-movers in this new industry.

Threat of substitutes: Direct e-mailing to media companies. Direct SMS or MMS to media companies. Existing products and services for transmission of different content could be

converted to something similar.

Bargaining power of suppliers (people that submit content): They could boycott our service and deal directly with companies, but this

requires much unstructured and undefined interaction for both parties. The business dealings may not prove successful without and intermediary.

They can switch to another company, if a competitor arises in the future. However, we are currently the only business of this kind in the UK and Ireland.

6 http://www.themanager.org/models/p5f.htm Article explaining the model for the Five Competitive Forces that were developed by Michael E. Porter in his book “Competitive Strategy: Techniques for Analysing Industries and Competitors“ in 1980.

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http://www.themanager.org/models/p5f.htm

Suppliers may find it difficult to deal with multiple companies if they bypass our service. They will need to remember multiple methods of transmitting content (e.g. phone numbers), multiple process chains of interaction (e.g. steps in sending content), and they will need to individually keep track of all interactions without intermediary assistance (e.g. tracking).

Threat of new entrants: Requires relationships to be formed on two fronts: the public who submit

content and any companies that purchase the rights to use this content. They need to enter an existing market (created by us) and pry market share

away from our company. They need time and resources to copy the idea and enter the market.

Bargaining power of end users / buyers (media companies): There is a risk that customers could develop similar in-house applications

rather than outsourcing. They face much cost, time, development and relationship establishment

problems if they are to create their own applications and services. Our business is the only one of its kind in Ireland and the UK, so they need to

use our product or lose competitive advantage to their competitors.

2.4 Competitive AdvantageWe believe that our product has a competitive advantage because we have not found any other system that uses mobile media content in the same way that our system does. This gives us our first-mover advantage, which will put us in a great position in

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the market place. Our system will allow media companies to access and use video and images, captured at the scene of an event by the general public, faster then ever before and they won’t have to wait for reporters to arrive on the scene of important events. The public will also be motivated to use our system as they will be receiving something in return for their video / images.

Our primary aim is to create a strong image and brand name around our product through our marketing strategy. In doing this we hope to dominate the market with our product. This will put off potential competitors from entering the market and customers will become comfortable with our product making them unwilling to change to a different system.

With our system fully completed, working and patented before anyone else we feel that our company will be in a very good position. Our system will be unique and we strongly believe that media companies will take great interest in our product. It will be our intention after launching this product in the UK and Ireland, to launch in markets abroad such as North America and Asia where media companies are plentiful.

2.5 Business Model

Business Model 1:

Our software will be made freely available on the Internet through our website. A license system will be used with a fee per seat per year to use the system. Initially there will three types of licences:

1. Standard License - There will be no alerts with this type and it will only be for one seat.

2. Premium License – This type will include alerts and it will be for five seats.3. Enterprise License – This type will include free alerts and the number of seats

will be limited by the size of the company.

Alerts will be sent to the user if a video / image is received from a certain person or the description contains a certain keyword.

When videos / images are processed by the system they will be priced by us after the user confirms, through e-mail, that they wish to sell them. They will be given an exclusive price and a non-exclusive price. When the videos / images are then purchased by a company, we will deduct a percentage of the money received by the sender. This will be in the region of 10-30%.

Business Model 2:

Our second business model would be to package our product up and sell it as a standalone product to a TV station or media company. The selling price for this will have to be considerately large, as we would receive no more revenue from the product once we sold it.

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The business model that we have decided to use is Business Model 1. We will use this model because we believe that it will generate the greatest amount of revenue from our product and this revenue will be continuous. If we were to use Business Model 2 we would only receive a once off lump sum.

Funding:

For our company’s development we will receive our funding from a suitable investor or Enterprise Ireland. With Enterprise Ireland the grants will come in three phases, which are:

1. Proof of Concept Stage2. Technology Development Stage3. Commercialisation and Development Stage

Awarding of the grants depends on certain criteria and conditions. Below are the maximum amounts available at each stage:

2.6 Revenue ModelThe revenue for our system is based on a license per seat model and the revenue received through content sales. The license per seat is a fee charged for the number of seats that use the system. The charge per seat would be based on the type of license purchased and would typically be around €5,000 per seat. Commission will be charged on the content that is sold. The commission rate will be on a sliding scale of approximately 30%7 for low value content, reducing to 15% for high value content. We would expect the BBC and BSkyB to purchase the Enterprise versions and smaller independent media houses would purchase the smaller licenses, such as TV3 and Channel 6.

2.7 Targeted Customers and Route to MarketThe main category of media companies that will be interested in our product will be the large TV stations in both Ireland and the UK. These stations will initially consist of RTE1, RTE2, TG4, TV3, Channel 6, BBC1, BBC2, UTV, CH4 and SKY NEWS. All of these channels are available on the SKY Digital Satellite System, which is available in both Ireland and the UK. We will also target media production companies. We intend to initially to focus our attention on the TV stations in the UK and Ireland for the following reasons:

The large increase in the amount of people using their camera phones in the UK and worldwide: One third of all mobile subscribers in the UK use their phones to take photos, a growth rate of over 200 per cent on the same time last year.8 It is projected that worldwide camera phone shipments will grow from 178 million units in 2004 to over 860 million units in 2009. By 2009, camera phones are expected to account for 89% of all mobile phone handsets shipped9. Although, there is a common perception that the quality of mobile videos is quite poor, mobile phones are getting better and 7 Appendix 5: Interview with Channel 6 media company8 http://www.w2forum.com/p/mms Article on camera phone usage within the UK

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http://www.w2forum.com/p/mms

better and they will continue to do so for years to come. Most of the camera phones that Vodafone are now selling have 1.4 mega pixel cameras. This is good enough to print a good quality 7 X 5 Inch photo. In appendix 8 is a frame from a video taken of Lance Armstrong in this year’s Tour de France. The video was recorded using an XDA from O2 on a second floor balcony. The quality of the video is quite good.

0100200300400500600700800900

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Worldwide Mobile Phone and Camera Phone Shipments

Non-Camera PhonesCamera Phones

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Mobile Phone Companies in the UK and Ireland continue to make huge profits each year: The graph below illustrates how companies in the Ireland and UK continue to do extremely well each year due to the amount of people using their mobile networks.

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9 http://www.capv.com/home/Press/2005/1.10.05.a.html Info Trends/CAP Ventures Releases Worldwide Mobile Imaging Study Results10 http://www.capv.com/home/Press/2005/1.10.05.a.html Worldwide Mobile Phone and Camera Phone Shipments11 Figures taken from the 2004 Vodafone Annual Report sent to shareholders and the O2 Annual Report which is available on the Web at http://www.o2.com/investor/financial_performance_report2005b.asp

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http://www.o2.com/investor/financial_performance_report2005b.asp

http://www.capv.com/home/Press/2005/1.10.05.a.html

http://www.capv.com/home/Press/2005/1.10.05.a.html

WWI, the company that owns Meteor Mobile here in Ireland, recorded profits of $5,325,000 in 2004. T-Mobile in the UK had sales increased by over €283 million in the first 9 months in 2003 compared to the first 9 months in 2002.12

More and more people are using mobile phones in Ireland and the UK: Customer numbers continued to increase for all companies in the UK and Ireland in 2004.

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The large amount of TV stations that are available in the UK and Ireland: Currently there is a huge amount of stations available to people in the UK and Ireland that have cable TV or digital satellite. SKY digital currently has over 9 million subscribers in the UK and Ireland. This figure is up 13% on last years figure.14 NTL Ireland and

12 Figures taken from the third quarter financial results at http://www.t-mobilepressoffice.co.uk/press/international/2003/print/151103-Q3.doc 13 Figures taken from the 2004 Vodafone Annual Report sent to shareholders, the O2 Annual Report which is available on the Web at http://www.o2.com/investor/financial_performance_report2005b.asp, from Western Wireless First Quarter 2005 Financial Results at http://www.ww-int.com/press.php?state=3&id=58 and T Mobiles financial Results for the 3 quarter http://www.t-mobilepressoffice.co.uk/press/international/2003/print/151103-Q3.doc

14 Figures taken from BRITISH SKY BROADCASTING GROUP PLC results for the nine months ended 31 March 2005 at http://media.corporateir.net/media_files/lse/bsy.uk/reports/2004ar/sky_2004/our_highlights.html

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http://media.corporate-ir.net/media_files/lse/bsy.uk/reports/2004ar/sky_2004/our_highlights.html

http://media.corporate-ir.net/media_files/lse/bsy.uk/reports/2004ar/sky_2004/our_highlights.html

http://www.t-mobilepressoffice.co.uk/press/international/2003/print/151103-Q3.doc


http://www.ww-int.com/press.php?state=3&id=58

http://www.ww-int.com/press.php?state=3&id=58

http://www.o2.com/investor/financial_performance_report2005b.asp


UK has nearly 900,000 subscribers.15 A lot of the stations that these companies broadcast are news stations, which will be our main market. News programs would use our product to access videos / images of important current events.

The similar usage of Mobile Phones in the UK and Ireland: People in the UK and Ireland use their mobiles in similar ways. Texting has become huge in both countries with companies reporting huge amounts of texts being sent each year. Last year over 9 million texts were sent per day in Ireland. MMS and camera usage is following the same pattern and they can only become more and more popular. The penetration of mobiles in the UK is 103% compared to 97% in Ireland.16 These are amongst the highest figures in the world.

2.8 Risk AssessmentAs with every business start-up there are certain risks involved. Here are the risks that we believe would affect our business most.

Unknown Companies using Mobile Multimedia Content in the same way that we doThere is a risk that another company has developed or is developing a system that is the same as our system. After extensive research we know that there are companies that use mobile multimedia in similar ways to us but we believe our system is unique in the way that people interact with their media once they put it onto our system. Media is also instantly available to companies once we have priced it.

Unknown PatentsUntil a proper search of the patent databases is carried out, there is a small risk that another group already patents our idea. We will employ an external company to carry out a search of patent databases and register our patents if they don’t already exist.

ManpowerThe company will need 4 full-time staff if our product is to get fully developed and our company is to get a first mover advantage. If the project doesn’t get the manpower it needs the product won’t get developed in time and other companies could beat us to the market place.

External Economic MarketsThe mobile communications market has been growing over the last couple of years and is expected to keep growing but if the market was to collapse it would leave us in a difficult situation and it might not prove feasible to develop our product. This is highly unlikely even though the global market for mobile phones suffered a decline in the rate of increase in 2002 due to the global downturn in electronics. The occurrence of another such downturn could affect the licensing of our technology to companies.

6 months before entry into Market

15 Figure taken from the first quarter 2005 results at http:// www. ntl .com/locales/gb/en/investors/qreports/2005-1.pdf 16 http://www.mobileyouth.org/my_item/9_mn_text_messages_sent_per_day_ireland Article on text message sending in Ireland

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http://www.mobileyouth.org/my_item/9_mn_text_messages_sent_per_day_ireland

http://www.ntl.com/locales/gb/en/investors/qreports/2005-1.pdf

It will take approximately 6 months to get a Beta version of our product developed and to have it ready for the market place. By this stage we intend to have a partnership formed with a TV station that will help us market our product and develop it further. The TV station will also be a source of funding for our product. We have already had some progress in this area. It will cost a lot of money to get the product to this stage and there is a risk that the product could fail and be unsuccessful. Our Enterprise Ireland Grant will be given to us in three stages. The awarding of each stage depends on the success of the stage before.

3 Market Analysis

3.1 SegmentationThe telecom market is segmented into the following sectors:

Broadband & Fixed Telecoms Handsets & Devices Media & Entertainment Mobile Content & Apps Mobile & Wireless Strategies Networks & Infrastructure

We are interested in the “Media and Entertainment” segment.

3.1.1 Media Organisation SegmentationMedia organisations are segmented as follows:

Televisiono Newso Entertainmento Sport

Radio Broadcasting Film Industry Recorded Music Industry Printed Press

o Newspapero Magazine

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o Book publishing Websites

Arbitro intends to service the television “News” and “Entertainment” segments initially and in the future to include other segments such as “Sport” and “Magazines”.

3.1.2 End User SegmentationBy the end of 2004 there was approximately 3.78 million mobile subscribers in Ireland. Analysing the results from the survey17 we found that 100% of participants owned a mobile phone and of the 70% that possessed a mobile phone with a camera, 50% came from the age group of 20 to 29. The next largest ownership group was from the age group of 30 to 44. This amounts to 1,508,593 people18.

The 20 - 44 age group is the segment that is most likely (87%) to send image or video content in order to receive payment. The 15 - 20 age group is the segment most likely to send content for no fee or for fun. According to ‘The MORI British communication survey’19 the following describes the ‘young communicators20’:

90% know that you can send and receive email on mobile phones, compared to the national average of 63%

87% are aware that you can send pictures (national average is 60%)84% know that you can access the Internet via a mobile (national

average is 55%)61% are aware of Instant Messaging capabilities on mobile phones

(national average is 40%)59% know that you can access information such as travel timetables

on the mobile (national average is 37%)

These results indicate that the 20 – 44 and the 15 – 20 age groups are both aware of and familiar with the technologies involved in our business. Therefore, services such as ours should be easily accessible and used intuitively by people in these segments.

The 2003 McKinsey21 survey demonstrates the success in the use of SMS messaging in TV programming. The survey concludes that SMS-TV is ready and prepared for the next generation of SMS, MMS. The research indicates that the user segment that Arbitro wishes to serve is already familiar with sending SMS messaging to TV stations and will quickly adopt the use of MMS messages.

3.2 CustomersOur customers are split into two groups. The first group is the public that supply us with image and video content. They will not directly pay us but will use us as a

17 See Appendix 1: Survey Questions Asked, Graphs & Tables of Results18 See Appendix 3: Central Statistics office 2002, www.cso.ie 19 The MORI British communication survey20 The term ‘young communicators’ relates to respondents fitting the following criteria: 16-34 years old; household income of £17,500 or above; whose attitude to buying new technology is positive, ie they did not agree with the statement ‘I rarely buy technology’ and those over 21 years are in employment.

21 See Appendix 9: A pitch for using MMS to create TV shows based on the success of SMS-TV shows.

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http://www.cso.ie/

broker for the content, which they capture. Commission will be charged on any payment they receive. In Ireland22 mobile penetration increased by 6% from 88% to 94% with over 3.78 million mobile subscribers. Additionally Vodafone launched its 3G service in November 2004. Meteor has increased its market share to 9% of mobile subscribers with Vodafone and O2 having 51% and 40% respectively. There were over 4 billion SMS messages sent in the last 12 months, an increase of almost 10% on the previous year. This equates to an average of 89 SMS messages per subscriber per month. The rate of increase in the number of MMS messages sent is expected to increase in the last quarter of 2005.

The second group of customers are the media companies that use image and video content. These include television, newspapers, magazines and web sites. There are 2 broadcasting companies in Ireland23 and 29 in the United Kingdom. Currently, end users have to negotiate on a case-by-case basis with each media company for the sale of media content so there is no set price scale. Typically, Sky News24 in the UK pays £250 sterling per video clip purchased.

3.3 CompetitionThe major competition is from users sending images and video content directly to media companies. Magazines list e-mail addresses or MMS phone numbers for users to send their clips to while TV programs display the address on the screen. Media companies receive the multimedia messages on their phones and they must filter through the large amount of unusable content in order to find suitable content. The NewsMarket and NowPublic are two companies providing similar services but are not considered direct competition.

The NewsMarket is a broadcast news distribution service that brings newsmakers and journalists together via a single Web-based platform to create a more efficient environment for the exchange of video news content. The content is of a professional quality whereas Arbitro’s content is of lower quality but is immediately available.

NewsMarket is not seen as a direct competitor with Arbitro but in the future we plan to develop a professional version of Arbitro to deal with videos of a professional quality.

Arbitro performs a similar function but will not be restricted to newsmakers and journalists. It will receive media from any user with a mobile phone.

NowPublic is an open source news site based in Vancouver that allows users to build their own news stories. The Web site, located at NowPublic.com, brings together photographers – both amateur and professional - and bloggers, letting them work together to cover news stories anywhere in the world.

22 Source: Baskerville and ComReg Estimates23 See Appendix 6: Broadcasters24 Source: ‘Citizen journos come of age’, http://www.theaustralian.news.com.au, Peter Wilson and Sally Jackson, July 14, 2005

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http://www.theaustralian.news.com.au/

http://www.theaustralian.news.com.au/common/story_page/0,5744,15920939%255E7582,00.html

3.4 Marketing

3.4.1 Marketing Mix: ProductParticipatory or Citizen Journalism is on the rise as more and more people create their own blogging sites containing news items including text and media elements. People are becoming more comfortable with having photographic capabilities on their mobile phones. They are unlikely to carry a camera everywhere but they will have their phone with them at all times.

The design of the product was influenced by our survey results, interviews with media industry organisations and current trends in the use of mobile media. Our technology will facilitate the reception, storage and sale of media elements. The product will be operated over the Internet utilising a central server for receiving and storing multimedia elements. There will be two user interfaces used to access and purchase content. The first user interface will be a consumer version and will consist of a Web site, which will be used for accessing content by the general public. This content will be of mass appeal. The second user interface will be a professional version and will consist of an installable application. This version will be used by media organisations to access the content. This content will be filtered based on the needs of the media organisation. The two user interfaces will have different licensing schemes (see “Price” below).

The benefits to consumers are:1. An encouragement to record images and video on their phones as there is a

well-known location to send the media to.2. Media recorded by the consumer will be permanently stored leading to its

value increasing over time.3. The optimum sale price will be established for the consumer by using domain

specialists to negotiate the value.

The benefits to media agencies and organisations are:1. Access to content recorded by consumers, which is filtered for quality and

labelled accurately for fast retrieval.2. A professional business relationship with a single entity with standard

negotiation terms rather than one-to-many relationships with individual consumers.

Value Chain and Stakeholders:

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The stakeholders in the value chain are: End Users / General Public – These are the people using the service by

recording and supplying media content. Telecom Operators – These are the mobile phone networks such as Meteor,

O2, Orange, T-Mobile and Vodafone. Media Processing – This is the Arbitro system, which receives content from

the End User via the Telecom Operator and makes it available to the Media Companies. The content is processed into a more manageable format allowing Media Companies to save time in locating and deciding on content to broadcast.

Media Companies – These are the television and magazine companies which license the Arbitro service enabling them to purchase content from the End Users.

System Process Analysis:The existing process enabling an end user to capture media content and then sell it to a media company is as follows:

Without the use of the Arbitro system, the time taken for a user to send their videos and images to all interested media companies is greatly extended. The end user must contact all media companies individually and negotiate terms with each. They will also not receive the best remuneration for their video unless they have specialised domain knowledge that allows them to set a value for the video accurately.

The system using Arbitro is as follows:

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Using the Arbitro system the workload on both the general public end and the media companies is greatly reduced. The end user need only contact Arbitro in order to sell their videos and images. Arbitro will handle the communication with all the media companies and will ensure the best price for the content. The media companies need only communicate with Arbitro greatly reducing the number of contacts they need to maintain. The media will be processed by Arbitro, which leads to a more simplified evaluation process by the media companies.

The advantages to this process are as follows:1. End users will record more images and videos as they have a consistent place

to deliver them to.2. Media companies will use more content supplied from mobile users as the

procedure of acquiring the content is simplified.3. End users will be encouraged to send in their content, as they will trust that

they are receiving the best price.4. Media companies will benefit in the time saved not having to view irrelevant

images or videos on a small mobile phone screen. This is because Arbitro will have processed all videos and only media of an expected quality will be delivered to the media companies.

Future Developments:The mobile environment is changing rapidly. Presently, the mobile operators are rolling out their 3G networks. Arbitro is compatible with 2.5G and 3G networks. As network speeds increase the experience of using Arbitro will become incredibly simple as the time to send video will be minimal. With the use of 3G and then following with 4G networks, Arbitro will evolve into a live service where the end user will deliver content to media companies as the event happens.

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Initially Arbitro intends to service the television “News” and “Entertainment” segments of the market. However, our product can be applied to many other areas. We intend to create different versions of the product for different markets.It can be adapted to many different areas in different ways and with different business models.

At later stages we will enter into the following areas with adapted versions of the product:

Televisiono Sport

Recorded Music Industry (e.g. album artwork) Printed Press

o Newspapero Magazine (e.g. celebrity photos)o Book publishing

Websites Police Information Recording (e.g. crime scene reporting/recording) Insurance (e.g. recording of insurable items as proof of ownership) Graphic Design (e.g. the selling of images to design firms)

Different versions, such as one for the police, could generate revenue using differing business models. For example, a package for the police could be sold as a standalone product as described by Business Model 2 [see section 2.5], as they would simply want to store and search through content rather than purchase individual pieces. Another example is of a version for the printed press segment that would be solely for images. We will create custom versions for each segment thusly. Each segment will be entered based on market conditions, demand, projected revenue and competition in the future.

Future developments for our technology are described in Section 6.

PriceLicensing:There are two options available for selling the Arbitro product. The first option is to sell Arbitro as a standalone application to another organisation. The purchasing organisation would have to maintain all content they receive as well as the relationship with the mobile network operators. This option would lead to less revenue for Arbitro in the long term, but could generate revenue quicker in the short term if a higher license fee was charged for a complete purchase.The second option is for Arbitro to host the service and to charge a license to each media company that wants access to the service. The license fee would be charged per seat on a yearly subscription. Commission will be charged for images and videos that are purchased by the media companies. The commission rate will be on a sliding scale rate of approximately 30% for low value content, reducing to 15% for high value content. End users may also have a fee-paying facility, where they can pay Arbitro a fee for their content to be evaluated quickly. This will allow the end user to signal that their content is urgent.

Promotion

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In order to promote Arbitro’s services, a one to one relationship or a strategic partnership needs to be made with a media company. This partnership will be of mutual benefit to both Arbitro and the media company. Arbitro will benefit from a connection with an organisation in its primary market channel. The media company will benefit from the competitive advantage of using the system. They will also benefit from being part of any promotional activities, such as demonstrating the product at tradeshows and press releases. It may be necessary to work with the media company in providing customised features. As a result, a one to one relationship needs to be maintained between a member of Arbitro and the media company. This person needs to be available for consultation with the partnering company.

By having the partnership we can begin to identify our target market better through the actual running of the beta product. This will help us to not only meet the public’s and media’s needs better but it will give us the added experience in both the technical and business aspects of the system.

As part of our partnership with Channel 6, we will have a mutually beneficial relationship. For example, in our meeting with Michael Murphy [see appendix 5] he suggested that Channel 6 would give us significant aid by hiring a marketing company to help deal with advertising. He suggested that TV adverts and billboard adverts were an example of this aid.

PlaceTarget Market Channels:In order for Arbitro to be successful, it is necessary to get high market penetration in a very short period of time. It is essential that Arbitro maintain its first mover advantage. It is therefore important that Arbitro becomes the standard for end user content delivery to media companies. To achieve this end users must become quickly aware of the Arbitro service and its benefits. To achieve this a strategic partnership with a media organisation will be established.

Primary Channel:Media OrganisationMedia organisations such as television stations are the primary target for the Arbitro system. They are already in the market for images and video captured by users on mobile devices. Media organisations such as the BBC and Sky News have a history using content provided by end users. The phenomenon of participatory journalism is growing. The aim is to establish a strategic partnership with a television station. The television station will be supplied with access to the Arbitro system at a significantly reduced license fee. The aim is to become established in the market and become the standard for mobile content reception. The other media organisations will require the Arbitro system if they are to remain competitive. Using the relationship with the television station, it is planned to develop exclusive television programming which will demonstrate the capabilities of Arbitro. Revenue will be generated by the commercialisation of the show and the services of Arbitro will be paid for in the form of a negotiated fee and advertising time.

Benefit to media company:

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1. Competitive advantage in having state of the art technology.2. Reduce license fee.3. Access to more content available.

Secondary Channel:Web CommunityArbitro will be available as a web site allowing end users to send their images and video content to the site from their mobile phones or e-mail accounts. This site will allow users to view each other’s images and videos while also providing functions such as voting and purchasing. This channel will breed familiarity among the mobile phone / web site users of the Arbitro system leading to the network effect of Arbitro becoming the standard for image and video content delivery.

3.5 Survey

3.5.1 Survey Analysis:Refer to Appendix 1 for an overview of the survey questions asked, graphs and tables of results.

The survey was conducted by passing out questionnaires to a stratified random sampling of people that we thought would represent our target market. They had to fill out a form and only answer the appropriate questions. As certain questions did not require a response, the percentage results given are those of valid responses only rather than a percentage of all participants. All results are approximate and may have been rounded for convenience.

About the participants: Most of the participants were in the 20-29 age range (40%). The 30-39 age

group were the second biggest group asked (25%). Other age groups ranged from 5-10% participation.

100% of participants owned a mobile phone. 75% of these used pre-paid phones, with the other 25% owning bill phones.

20% couldn’t live without their phones, while another 45% valued them a lot. 25% did not value them massively and only 10% said they could live without them.

40% used all features of their phones (such as cameras, MMS, etc.) and 60% did not.

70% of people owned a camera phone and 30% did not. Of the people who did not own a camera phone, 50% said their next phone would be a camera phone. 30% would not get one and 20% were undecided.

Results from those with camera phones: 93% did use it to take pictures/videos while only 7% did not use this function.

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29% took 1-5 photos/videos a month. 21% took 6-10 and another 21% took 11-15. The remaining 29% took 15+ per month.

The largest use of the camera was for photographing/videoing “going out” or a “family member”, with 23% and 22% respectively. Other main uses were for sporting events and pictures of boyfriends/girlfriends. Smaller results arose for holidays, weddings, birth of children and other non-listed events (such as work).

Results from all participants: 50% of people used MMS to send multimedia to other people and 50% did

not.

75% of people would take a picture of something interesting if they saw it. Only 25% would not.

40% would send it to a media company. 60% would not send it and would prefer to keep it themselves.

Of the 60% who would not send content to a media company, 75% would decide to send it if they had the possibility of getting money for it. 25% of that original 60% would still not send it.

Most people (27%) expected to get around €100 for an important piece of video or photograph they submitted. The second largest result was 19% expecting €200 with another 19% expecting €1000. Smaller numbers of people (7% each) would only expect small rewards such as €5 or €10. Other results were 14% wanting €150 and 7% expecting €300.

In the future we intend to create more and improved surveys that will give us better details about our market. We will aim to have them completed by a larger and more random grouping of people.

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4 Operations Plan

4.1 Operations Strategy

4.1.1 Development PhaseThe completion of the product concept development and preparing our technology for licensing is being funded with the investment of €90,000 made by Enterprise Ireland. This phase focuses on getting our technology ready for licensing. These funds are being used as follows:

Completion of the product development stage Completion of the patent application Incorporation of the Venture and Legal Fees

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4.1.2 Operational PhaseDuring the operational phase, we officially open our doors for business. We will initially be launching a beta version of our product. The reason for this is to get our first-mover advantage in the marketplace. We start by executing a licensing agreement, and identifying media companies that our product will appeal to. Our goal is to secure a partnership with a major media company within the UK and Ireland. We have already made contact with a TV station within Ireland who is interested in our product.

Personal sales presentations by the executive staff will be used to negotiate licensing agreements. The original four founders will manage execution of this phase with limited support staff as outlined under Human Resource Requirements. Licensing agreements will be for one year with annual minimum thresholds to ensure proper commercialisation by our licensees.

4.1.3 Full Launch PhaseDuring the full launch phase our technology is fully developed and we will be targeting all the media companies in the UK and Ireland. Our primary function remains supplying proper technical support, continuing to identify new categories, continuing to developing our system in new ways and defending our intellectual property.

5 Management and Labour RequirementsThere are currently four post-graduate students working on this project. The four students are working fulltime on the project and the group consists of 2 students with a business background and 2 students with a computing background. If the research was found to be commercially viable we would like to have the following management structure in place by the end of phase three:

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5.1 SalariesFor the first two phases, our main aim would be to get a fully working beta version of our product ready. Ideally, one of the developers will double as a CEO. Initially the salaries for the group will be small and this is unlikely to be a problem, as they will have already worked on the project for three months without any pay. The salary amounts will also be limited by the Enterprise Ireland conditions. The CEO would be responsible for the start-up of the business and the success or failure of the company. He would take care of marketing, strategy, financing, hiring, firing and general operations.

In phase three one member of the group will begin to work full time as a Business Development Officer. He will be responsible for making contact with the TV and media companies and he will try to sell our product to them. The business development officer’s role requires someone with specialist domain knowledge of the TV business and how pieces of media are licensed. As a result a competitive salary will need to be paid and he would receive commission after that depending on his sales. The administrator would be taken on part-time for the second phase and by phase three we would hope to have him/her working with us full-time. We will use consultants for advice on external markets and external accounting firms will manage our accounts. Legal advisors will be used to register our patents and deal with any legal issues that we may have. Tomkins who specialise in Patents and Licenses have already been consulted for advice on patenting issues with our product and licensing issues with pieces of media.

Annual Salaries

Phase 1 Phase 2 Phase 3 Full LaunchCEO €20,000 €80,000

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CEO

CTO Chief Operations Officer Business Development Officer

Administrator

Business Development Officer

€10,000 + Commission

Min. €15,000 + Commission

CTO €10,000 €45,000Chief Operations Manager

€10,000 €45,000

Administrator €5,000 €25,000

6 Technical Report

6.1 System OverviewThe Arbitro system is Internet based. It contains a centralised server that is hosted by us. End users supply the system with multimedia content (images and videos) using

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one of two methods. The first method is via email; the second is using MMS. The media organisations access the content using an installed user interface that uses Web services to access the media content on our service. The system architecture is as follows:

The system contains the following sub-sections: Web Services E-Mail Server SMS / MMS Gateway Message Processing Server User Interface

6.2 Web ServicesWeb Services are used as an integral part of our system. They allow the client application to communicate with the database; they allow the e-mail and MMS server to communicate with the database and they allow the notification system to communicate with the database. Web services are web-based enterprise applications that use open, XML-based standards and transport protocols to exchange data with calling clients. They represent a new platform on which developers can build the same distributed applications they've always built, but with interoperability. This means that developers can develop applications that work on different platforms and with different operating systems.

XML is used to transfer data between different applications because it is a cross-platform, extensible, text-based standard for representing data. In our system XML is used to represent the different objects and data that is transferred between the server and other applications. These applications are free to do what they want with the data when they receive it. The fact that data is in an XML format makes it extremely easy for machines to read.

SOAP or Simple Object Access Protocol is the transport protocol used to transport client requests and web service responses. SOAP is transported over HTTP to enable a completely interoperable exchange between clients and web services, all running on different platforms and at various locations on the Internet. This is the beauty of Web Services; any computer connected to the Internet can access our service if needed. HTTP is a familiar request-and response standard for sending messages over the Internet, and SOAP is an XML-based protocol that follows the HTTP request-and-response model. This makes interoperability possible.

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Our service is described on the Internet using WSDL or Web Service Definition Language. WSDL is a standardised XML format for describing network services. Below you can see an example of our WSDL file, which describes our Web Service.

In this section of our WSDL file you can see where the Notification Object and Message Object are described. The description includes the name of the service, the location of the service, and ways to communicate with the service, our service is called MediaService and it uses SOAP encoding. WSDL service descriptions can be stored in UDDI registries or published on the Web. This allows them to be discovered and used by other companies who would be interested in our services.

To develop the Web Service for our system we used J2EE, the Java Application Server and JAX-RPC. JAX-RPC stands for Java API for XML-based RPC. JAX-RPC is a technology for building web services and clients that use remote procedure calls (RPC) and XML. Often used in a distributed client-server model, an RPC mechanism enables clients to execute procedures on other systems. In our system the client application will communicate with the application server using our Web Service. The client will pass arguments to methods on our application server and the server will return data in the form of XML SOAP messages. On the server side, the developer specifies the remote procedures by defining methods in an interface written in the Java programming language. The developer also codes one or more classes that implement those methods. Client programs are also easy to code. A client creates a proxy (a local object representing the service) and then simply invokes methods on the proxy. With the JAX-RPC API, clients and web services have a big advantage: the platform independence of the Java programming language. In addition, JAX-RPC

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is not restrictive: a JAX-RPC client can access a web service that is not running on the Java platform, and vice versa. This flexibility is possible because JAX-RPC uses technologies defined by the World Wide Web Consortium (W3C): HTTP, SOAP, and the Web Service Description Language (WSDL). In our system C++ code was created from our WSDL file quite easily and we were able to communicate with our server using this code.

Our Web Service is a service-oriented Web application that implements the endpoint of a Web Service. In the creation of our Web Service, a war file is created and this is deployed onto our application server. A deploytool is used to do this, which is a GUI tool to package applications, generate deployment descriptors, and deploy applications on the Application Server. Once the Service is deployed onto the server and the server is up and running, client applications are free to access the service as they please.

MYSQL Database Server is used to store the tables and information that our system needs. MYSQL is used because its architecture makes it extremely fast and easy to customise. Its management system is unmatched in speed, compactness, stability and ease of deployment. In our system there are a total of 6 tables, which are:

InternationalWeatherStations: This table stores GPS coordinateds in Ireland and their nearest place name.

Media: This stores information on the media sent into our system. Notification: This stores information for our notification system, which will

be explained shortly. Purchase: Each row in the media table has a corresponding entry in the

purchase table, which stores information about if it’s been purchased before or it’s been exclusively held.

Sender: This holds information on the people that send in the media into our system.

The database and these tables are accessed and manipulated using our Web Services. The database is connected to our application server using JDBC and connection pools. Connection pooling is a technique used for sharing server resources among requesting clients. Our connection pool allows a maximum of 32 connections. This can be increased or decreased as the developer pleases. The database connection is then given a JNDI name and this is registered with the JNDI naming service. An application can then use the JNDI API to access that DataSource object, which can then be used to connect to the data source it represents.

A notification system also exists to notify people of new media containing a certain keyword or media that has been sent by a certain person. People create a notification through the user interface. The user interface interacts with the notification table using the Web Services. A Java program called Notify runs on the computer that also hosts the MYSQL database. This program checks the database every 30 seconds for a new entry using a JDBC connection. If a new entry exists, the program checks to see if there is a corresponding entry in the notification table. If someone has to be notified about a new entry the Java Mail API is used to send the person a notification about the new piece of media and it’s corresponding media ID number. This person can then use their client application to access the media in question.

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6.3 E-Mail ServerThe e-mail server is used to receive content captured by users and sent by email. It uses the Java Mail API to detect if emails received contain video or image file formats supported by Arbitro attached. Supported messages are forwarded to the Message Processing Server.

6.4 SMS / MMS GatewayThe MMS Gateway is an interface to telecom operator MMSCs25. At the core is a Celtius MM1 protocol implementation library, which we will license. Celtius26 Protocol libraries implement a set of protocol stacks in the field of mobile messaging. The protocol libraries include e.g. PoC (Push-To-Talk), MMS (MM1, MM7, EAIF), IMPS, WAP, HTTP and Push. We have received a 2-month trial license27 of the C++ MM1 (MMS) protocol implementation. This development license provides us with a set of APIs, which receive MMS messages either directly from Mobile phones or from a Mobile Operator. Messages received are forwarded to the Message Processing Server.

The SMS gateway is used to send instructions to users that send in media content. When content is delivered to Arbitro via MMS, the sender is sent an acknowledgement and request for confirmation via SMS. This is implemented using a bulk SMS messaging services provider. The provider we are using is Clickatell28. They enable us to send SMS messages for €0.044 each using their SMS Gateway Connect service. This service allows us to send global SMS messages using their HTTP APIs.

The SMS and MMS gateway is implemented using VC++.

6.5 Message Processing ServerThe message-processing server performs the image and video processing. Messages received contain images or videos in MIME29 format. The MIME formats supported by Arbitro are: video/vnd.avi; video/mpg; video/mpeg; image/gif; image/pjpeg. The video processor currently supports the following codecs: AVI; MPEG-1; MPEG-2; MPEG-4; 3GP. Current mobile phones capture video in MPEG-4 or 3GP.

The function of the message processor is to extract thumbnail images from the videos. These thumbnails or key frames represent a synopsis of the video. They facilitate the fast identification of the subject matter. Key frames are selected using colour histograms. A histogram is calculated for each frame in the video. Frames, which have a colour histogram significantly different from the previously chosen key frame, are selected. The process is iterative and stops when a maximum of 5 key frames is found. Each key frame is then resized and stored in JPEG format. Image files received are treated similarly as only a thumbnail needs to be created. This is simply a resized version of the original.Meta data belonging to the message, such as subject, sender, date, content text, is formatted and sent via the Web Service to the database.25 MMSC - Multimedia Messaging Service Centre.26 http://www.celtius.com.27 Full Celtius license is €6,000 per server.28 http://www.clickatell.com29 MIME (Multipurpose Internet Mail Extension)

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The message processing is written in Java and uses The JMF (Java Media Framework) for processing MPEG movies and images, QuickTime for Java for processing MPEG-4 and 3GP movies.

6.6 Graphical User InterfaceOur graphical user interfaces (GUIs) are created using Java Swing and JFC30. This software is free for download from the Java website. JFC is short for Java Foundation Classes, which encompass a group of features for building GUIs and adding rich graphics functionality and interactivity to Java applications. It is defined as containing the features shown in the table below.

Features of the Java Foundation Classes Feature Description

Swing GUI Components Includes everything from buttons to split panes to tables.

Pluggable Look-and-Feel Support

Gives any program that uses Swing components a choice of look and feel. The Java platform supports the GTK+ look and feel, which makes hundreds of existing look and feels available to Swing programs.

Accessibility APIEnables assistive technologies, such as screen readers and Braille displays, to get information from the user interface.

Java 2D APIEnables developers to easily incorporate high-quality 2D graphics, text, and images in applications and applets.

Drag-and-Drop Support Provides the ability to drag and drop between Java applications and native applications.

Internationalisation

Allows developers to build applications that can interact with users worldwide in their own languages and cultural conventions. With the input method framework developers can build applications that accept text in languages that use thousands of different characters, such as Japanese, Chinese, or Korean.

We decided to use Java Swing GUIs because it allows the software to be downloaded from the web or copied from a CD and installed on individual PCs, rather than simply using a web site. The GUIs transmit information across the web and communicate with the databases via Web Services (described earlier in this section). This also 30 http://java.sun.com/docs/books/tutorial/uiswing/14start/about.html Description of Java Swing

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http://java.sun.com/docs/books/tutorial/uiswing/14start/about.html

allows us to control copies of our software and how many can be used by each company that purchase it.

The GUI contains features such as: Search functionality A directory tree structure for manual search A dynamic table displaying summary information of multiple content

selections A details panel containing more detailed information on selected content An alerts interface to set automatic alerts/warnings about incoming content,

without the need to search for it A purchases interface to allow financial transactions

Frames Panel:There is a dedicated section of the JFrame located at the bottom of the screen for displaying fixed information on the video/image such the Senders ID, Location, Price of Content and information which may be edited by the administrator such as the message subject and text body. This section also has a dedicated area for displaying the key frames of each video and holds buttons such as a Purchase Button for launching the Purchase Panel and the Launch Video button used for playing the associated video file through the Video Panel.

Purchases:This GUI displays financial information. The price of content is displayed in various currencies (namely € and £ sterling) as we are targeting the Irish and UK markets first. Our company sets the prices.

Users choose to purchase content for a time period of 1-12 months. There are two ways to purchase content:

Exclusively – any other exclusive or non-exclusive purchases are then blocked so that the buyer will be the only one to have the content. Only the same company can re-buy it exclusively once the selected time period expires, or else it will become available non-exclusively.

Non-exclusively – many companies can purchase the content but no one can ever make an exclusive purchase of this content.

The frequency with which each video/image has been purchased is displayed on screen. For example, a certain image may have been purchase 0 times exclusively and 11 times non-exclusively to date.

Financial details (e.g. purchaser details) will not need to be entered every time a purchase is made. The software sitting on client’s PC will automatically send those details because they have registered with us once we sold them the software licence. Once a purchase is made, financial transactions will happen via Secure Socket Layer (SSL) security.

Future developments would be to have a team of people judging the merit of selling each video/image exclusively or non-exclusively. They would then decide if each one required one or both methods of purchase rights. For example, selling many copies of

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an important news video non-exclusively could potentially make more money than selling one high priced exclusive copy.

Video Panel:We launch another JFrame to house the video component of each video selected to view. The button is pressed in the “Frames Panel” and the JFrame is launched. We use the Java Media Framework™ API (JMF™) to handle the rendering of the video image. The JMF™ provided us with a ‘player’ interface that we used to capture and display the image. The JMF™ will also allow us to stream the video from our server to the clients’ desktop machine.

The Details Panel:(JTable)This is the section that displays a brief summary of the all the messages relevant at any given time. It is located in the centre of the screen and has been given lots of space so as to make it easy for the user to get a good overview of the messages details. It provides us with quick essential info on each message such as the media type (video/image), the Key Frame, the location taken at, the text content and the subject.

Tabbed (Filter) Panel: (JTree)This is the section on the left of the screen. Its function is to act as a filter for messages. It filters all messages by the date that they were sent on. For example, get messages sent today, sent in the last 7 days, sent this month, or sent any month throughout the year. A more specific search is available through the Search Panel.

The Menu Bar: (JMenuBar)The Menu Bar sits at the top of the main JFrame. It provides us with the facility to exit the program and allows us to manage your ‘Alerts’. The alert data is actually stored in the database but it is viewed through the Alerts Panel, which is accessed via this Menu Bar. There is also a Help function, which gives basic information about the program and how to use it.

Alerts:This GUI displays a list of previously initiated alerts and their details. These alerts can be deleted or new ones can be added. The user can search for alerts based on Subject, Sender or Content. Certain phone numbers or e-mail addresses can then be alerted about the arrival of such content without the user manually needing to search it. For example, one could set an alert to warn them if any videos arrive that relate to the “London Bombings” and then specify the phone or e-mail account to send this alert to.

Future developments would be to set alerts based upon video/image similarity, audio similarity and location based on the GPS positioning system. We would also like to combine these alert functions. For example, we could keep a look out for videos about the subject of “Michael Jackson” that have frames of him walking out of court and have audio that mention the word “verdict”.

Search:This facility allows users to search for videos/images based on text. They can enter some text in the search area and then select ID Number, Date, Sender, Subject,

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Content or Location as a search option. For example, they could enter the text “Glasnevin” and select “location” as the search facility. The table will display a summary of the results of all the videos/images that were taken in that location.

Future developments would be for searches based upon video/image similarity and audio similarity. We would also like to combine search functions. For example, we could search for videos about the subject of “Iraq” that have frames of Saddam Hussein and have audio that mention the word “USA”.

Heuristic Evaluation:There are nine principles that correspond more or less to principles that are generally recognised in the user interface community. Almost all usability problems fit well into one of these categories. The 9 principles are31:

1. Simple and natural design2. Speak the user’s language3. Minimise the user’s memory load4. Be consistent5. Provide feedback6. Provide clearly marked exits7. Provide shortcuts8. Provide good error messages9. Error prevention

Four random people from various University courses were chosen to view/use the GUIs and make comments in relation to the nine principles. These comments were collated and the results are shown in the table below. The results are abbreviated for ease of display.

Num. Alerts GUI Purchases GUI The Main GUI1 Logically ordered lists,

buttons and text areas

Easy to determine how the GUI operates (e.g. easy to see how to add/remove alerts)

Logically ordered information and menus

Easy to determine how the GUI operates (e.g. buy a non-exclusive copy of a video)

The overall look and feel to the GUI should be very recognisable to its users. First of all it has the familiar Menu bar across the top of the main Window. Every Panel also has a specific function and each Panel has been given a sufficient amount of screen to allow it to be clearly visible

2 Labels are used and radio buttons are described simply

Labels are used

A help section may be needed for first time

The language used to guide the user around the GUI is very user friendly. It uses non-technical English to

31 Molich, R., and Nielsen, J. (1990). Improving a human-computer dialogue: What designers know about traditional interface design, Communication of the ACM. (March 1990).

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A help section may be needed for those who may have trouble

users so that they know what “exclusive” and “non-exclusive” purchases are, as well as the conditions for purchase (e.g. buying non-exclusive prevents exclusive purchases for anyone else)

describe things such as the filtering of the messages in the Filter Panel. Also the labels for the details and buttons in the Frames Panel are easily understood (e.g. ‘Launch Video’ and ‘Purchase’)

3 There are only a few buttons that can be clicked and they are intuitive enough so that not much learning is required

There are only a few buttons that can be clicked and they are intuitive enough so that not much learning is required

The user rarely has to use their memory.

Everything is always there in front of them and the GUI is very clear and intuitive. Therefore it is easy to navigate by briefly glancing at the labels.

4 The GUI is consistent with the other GUIs

The text fields and radio buttons are the same as others that appear in the other GUIs

The list is a new feature but is not difficult to use

The GUI is consistent with the other GUIs

The text fields and radio buttons are the same as others that appear in the other GUIs

The look and feel of the GUI has been kept very similar all round so as not to cause confusion among users.

5 Alerts appear and disappear from the list so it is easy to see that actions have been carried out successfully

Feedback is provided on the number of purchases

It is obvious that something has been purchased successfully because users are able to download it

A confirmation of the financial transfer should maybe be displayed

When a user makes a decision that may alter any of the messages or involve payment the user is notified of their actions and is asked if they would like to continue or cancel.

There is also a help feature that provides information to the user if they require assistance.

6 Closing the GUI is simple and operates the same way as other windows

Closing the GUI is simple and operates the same way as other windows

The main Window (JFrame) has a clearly marked exit button as standard, but there is also an exit option found within the ‘File’ menu option.

This is very like other popular

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applications and should provide no hindrance to the user.

7 Keyboard shortcuts are available for radio buttons

It would be good to have keyboard shortcuts for everything (e.g. text fields)

No keyboard shortcuts are available

There are shortcuts found in the Menu Bar and Search Panel.

8 There are no error messages as users cannot cause an error

If something does not download successfully it is the fault of the operating system or Internet connection, so the GUI does not provide any information. There could be some facility to re-download it without extra cost

If an error occurs, the system reports to the user in an easily understandable manner.

No technical jargon is included.

9 There is no room to cause an error (e.g. the GUI prevents users from adding an alert if they do not give it a name)

There is no room to cause an error (e.g. users only click buttons and do not have to enter any details themselves)

Errors have been prevented by closely following the logical flow of the GUI.

6.7 Competing SolutionsCurrent Technologies permit any organisation with a background in Web Based Image Processing and/or Content Management to enter this arena. Therefore there are no direct competitors, yet there are companies doing work in similar areas that may cause a threat. The main difference between ourselves, and the existing companies is how we use the technologies to act as an agent between individuals acquiring content and its purchasers, namely various media organisations.

Existing organisations currently doing business in these areas are: Brainstorm, Flickr™, SmugMug, The NewsMarket and NowPublic

Brainstorm is a company that provides the technologies necessary to send/receive and manage multimedia data, specifically through the MMS format.

Flickr™ is a Photo Management System. It allows user to share its photos with anyone they want by posting them in a kind of “blog”. They have a technology feature similar to ours. It lets you upload images directly from your mobile to your web space. This is done via an e-mail address unique to the user.

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SmugMug is again a Photo Management System but it has more of an e-Commerce twist to it. You display your images in your own Web space with the option for these images to be protected by watermarking. You can order prints of your images via the web site, and others can purchase copies of your images as prints or by downloading them for a charge. SmugMug handles all of the transactions with the purchaser in return for 25% of the revenue generated per transaction.

The NewsMarket supplies broadcast-standard video and other multimedia content to the press. The NewsMarket delivers its content in three ways:

Digital Download with four options – FTP Pull, FTP Push, Telestream Clipmail/Clipmail PRO, or Pathfire DMG APTN Satellite Feed Beta-SP Video Tape

NowPublic allows bloggers and journalists to break stories and you are encouraged to give your own account of what happens through text/image/video reporting. NowPublic protects your work with a Smart Media format, ensuring that you get the credit no matter where your footage is used. With Smart Media, anyone who sees your work can easily contact you, thank you, praise you, ask you to take an assignment, or request a hi-resolution version of your photo.

6.8 Competitive AdvantageOur competitive advantage will come from the use of a dedicated MMS short code service number that will be integrated into all of the existing mobile phone networks. These short code service numbers are available to the public in the UK at the moment, but no one uses them for the same purpose as we do at the moment. They are not yet available in Ireland until Q1 of 2006. Our system will not be released till then but is full able to handle it now and when it becomes available our system will be the first in the country to use it for this purpose. The combination of this and the unique way that we acquire and process multimedia data from mobile phones will keep us ahead of competitors.

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7 Finance

7.1 Funding & Assumptions7.1.1 FundingThe completion of the product concept development and preparing our technology for licensing is to be funded with €90,000 grant from Enterprise Ireland. This funding will be used to get the company started and to develop the system to a suitable level so that we can begin a beta program. The next phase will be funded by the beta program partnership we will initiate with a TV station. The TV station will be an early adopter and revenue will be generated as part income and part advertising time. Cash income will come from beta license fee and income from premium MMS phone numbers used by end users to send in video clips. This funding will sustain the company until the full launch phase. See Section 3.4.1 under the heading of “Promotion” for more information on how this partnership relates to marketing.

7.1.2 AssumptionsCashflow 2005-2006 AssumptionsWe intend, through the beta program partnership, to be the technology used in a new format TV show. The TV channel will promote this show. We will receive income through the license fee (€1,500) and from user sending in clips. The following table shows the income from the beta program (€13,200) and the estimated monthly income after full launch. Initially the income will be €32,700 per month increasing by:

No of videos received 200Premium rate income €1 each €200.00No used 30 @ €150 each €4,500.00Commission @ 20% €900.00Sub Total €1,100.00Total after 12 episodes €13,200.00

Daily number received 100Premium rate income €1 each €100.00No used 22% @ €150 each €3,300.00Commission @ 30% €990.00Sub Total €1,090.00Total per month €32,700.00

Total revenue€45,900.0

0

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7.2 Sales & Profits

Revenue Gross Profit Net ProfitSep 1st 2005 - July 31st 2006 €268,322.55 €169,156.96 €135,616.64Aug 1st 2006 - July 31st 2007 €595,426.96 €444,383.07 €369,954.70Aug 1st 2007 - July 31st 2008 €595,428.01 €276,488.09 €202,059.59

3 Cashflow 2005-2006

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7.4 Cashflow 2006-2007

7.5 Cashflow 2007-2008

Half Year Cash FlowAug.2007-Jan.2008

Aug.2007-Jan.2008Sources of CashSales €595,428.01Subtotal €595,428.01

Cash DisbursementsSalaries €132,500.00Payroll Taxes and Benefits €14,243.75Rent €6,000.00Insurance Premiums €750.00Audit/Accounting - Legal Fees - Telephone + Internet €1,500.88Light €718.73Travel €3,000.00Office Supply €180.00Office Furniture - Office Equipment - Depreciation - Total Cash Disbursements €158,893.36

Opening Balance €576,770.30Closing Balance €1,013,304.95

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7.6 Profit and Loss Account

Yearly Profit and Loss A/C01/09/05-31/07/06 01/08/06-31/07/07 01/08/07-31/07/08

Sales €268,322.55 €595,426.96 €595,428.01

Total Cost of SalesSalaries €45,000.00 €85,000.00 €265,000.00Payroll Taxes and Benefits €4,837.50 €9,137.50 €28,487.50Rent €12,000.00 €12,000.00 €12,000.00Insurance Premiums €750.00 €750.00 €750.00Audit/Accounting €2,500.00 €2,500.00 €2,500.00Legal Fees €0.00 €32,000.00 €0.00Telephone + Internet €2,033.52 €2,788.30 €3,077.74Light €1,245.75 € 1,245.76 €1,473.84Travel €6,000.00 €6,000.00 €6,000.00Office Supply €360.00 €360.00 €360.00Office Furniture €1,950.00 €0.00 €0.00Office Equipment €20,449.00 €0.00 €0.00Total Operating Expenses €97,125.77 €151,781.56 €319,649.08Depreciation €2,799.88 €0.00 €0.00Bad Debts €0.00 €0.00 €0.00Pre payment €1,000.00 €1,000.00 €1,000.00Accruals €239.95 €262.33 €290.84Profit and Loss Before Tax €169,156.96 €444,383.07 €276,488.09Taxes Incurred €33,540.32 €74,428.37 €74,428.50Include Negative Taxes €0.00 €0.00 €0.00Profit and Loss €135,616.64 €369,954.70 €202,059.59

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Appendix:

Appendix 1: Survey Questions Asked, Graphs & Tables of Results

1. In what age category do you fall?

Age Range % People in Each0-9 510-19 520-29 4030-39 2540-49 550-59 1060+ 5

What age category do you fall?

0-910-19

20-29

30-3940-4950-59

60+

2. Do you own a mobile phone?

Response % People in EachYes 100No 0

3. If yes, do you have a bill or are you pre paid?

Response % People in EachPre-Paid 75Bill 25

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4. How much do you value your mobile?

Feelings Towards Phones % People in EachCouldn't Live Without it 20A Lot 45Not Much 25Could Get By Without it 10

0

510

15202530

3540

45

% People

Value of Mobile Phone

Couldn't Live WithoutA Lot

Not MuchCould Get By

5. Do you use all the features on your mobile, i.e. WAP, GPRS, MMS, Games, etc.


6. Do you own a camera phone?


7. If no, will your next phone be a camera phone?

Response % People in EachYes 50No 30Don’t Know 20

8. Do you use it for taking pictures/video?


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9. If yes, how many do you take a month?

Number of Photos % People in Each0 01-5 296-10 2111-15 2115+ 29

0

5

10

15

20

25

30

0 1-5 6-10 11-15 15+

Photos taken each Month

% People

10. What do you take pictures/videos of?

Photos/Videos Of… % People in EachHoliday 8Wedding 5Going Out 23Sporting Event 14Boyfriend/Girlfriend 14Office Party 3Family Member 22Other 11

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% People take Pictures of

HolidayWedding

Going OutSporting EventBoyfriend/Girlfriend

Office PartyFamily Member

Other

11. Do you use MMS to send mobile multimedia/pictures?


12. Would you take a picture/video of something interesting you saw?


13. Would you send that picture/video to a media company like a TV station or magazine?Response % People in EachYes 40No 60

14. If no, would you be willing to send them if you got money for them?


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15. What would be the minimum amount of money you would expect for an important picture or piece of video? €_________

€ Prices Stated by Participants % People in Each5 710 7100 27150 14200 19300 71000 19

0100200300400500600700800900

1000

7 7 27 14 19 7 19

Money People expect for Photos (euro)

% People

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Appendix 2: Entertainment & Media Industry Overview

Entertainment & Media Industry Overview

Amount Date Source

Total Consumer Spending on Media*, U.S. $190 bil. 2004 Veronis Suhler Stevenson

RADIO

FM Radio Stations (Including Educational FM stations), U.S. 8,729 Sept. 2004 FCC

AM Radio Stations, U.S. 4,770 Sept. 2004 FCC

Number of Radio Stations Broadcasting Digitally, U.S. 150 2004 Electronic Business

PRINT MEDIA

U.S. Magazine Revenues $21.4 bil. 2004 Publishers Information Bureau

Total Number of Daily and Sunday Newspapers, U.S. 2,300 2004 Plunkett Research Estimate

Total Book Publishing Net Sales, U.S. $25.0 bil. 2004 Plunkett Research Estimate

TELEVISION

U.S. Households with Televisions 109.6 mil. 2005 Nielsen Media Research

Broadcast TV Stations, U.S. 1,748 Sept. 2004 FCC

Cable TV Subscribers, U.S. 73 mil. 2004 Jupiter Media

Digital Cable Subscribers, U.S. 27 mil. 2004 In-Stat

Worldwide Digital Cable Subscribers 42 mil. 2004 In-Stat

Worldwide Revenues for Cable Modem Services $18 bil. 2004 In-Stat

Number of Mobile Phone TV Subscribers 270,000 2004 In-Stat

Number Projected for 2005 1.2 mil 2004 In-Stat

Mobile Phone TV Revenues in 2004 $32.8 mil. 2004 In-Stat

Revenues Projected for 2005 $47.5 mil. 2004 In-Stat

U.S. Homes with DVD Recorders (DVRs) (est.) 7 mil. 2004 Yankee Group

U.S. Homes with DVRs Projected for 2008 33.5 mil. 2004 Yankee Group

U.S. Homes with Video-On-Demand (VOD) Services 19 mil. 2004 Rainbow Media Holdings

Number of TiVo Subscribers, U.S. 2.3 mil. 2004 Plunkett Research Estimate

Total Digital Televisions (DTVs) Sold 7.2 mil. 2004 CEA

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MUSIC

Global Music Sales $32 bil. 2004 Reuters

CD Sales, U.S. $12 bil. 2004 Various Sources

Concert Revenues, North America $2.8 bil. 2004 Pollstar magazine

Approx. Number of Legitimate Music Download Sites 230 2004 IFPI

Number of Tracks Sold in the US and Europe 200 mil. 2004 IFPI

Number of iPods Sold 4.4 mil. 2004 Apple Computer, Inc.

FILM

U.S. Box Office Revenues $9.4 bil. 2004 USA Today

Average U.S. Ticket Price $6.25 2004 Exhibitor Relations Co. Inc.

Number of Movie Tickets Sold, U.S. 1.47 bil. 2004 Exhibitor Relations Co. Inc.

DVD Rentals and Sales at Retail, U.S. $21.2 bil. 2004 USA Today

VHS Rentals and Sales at Retail, U.S. $3.3 bil. 2004 USA Today

Number of Indoor Movie Screens, U.S. 35,585 2004 National Assoc. of Theater Owners

Number of Drive-In Movie Screens, U.S. 641 2004 Drive-In Theater Assoc.

ELECTRONIC GAMES

Retail Sales of Video Game Products (excl. PC Games), U.S. $9.9 bil. 2004 NPD Funworld

Total Video Game Industry Software Sales, U.S. $6.2 bil. 2004 NPD Funworld

Approximate Portable Gaming Software Sales, U.S. $1.0 bil. 2004 NPD Funworld

IFPI = International Federation of the Phonographic Industry

*Estimate. Includes consumer spending on cable and satellite tv access and services; consumer books; consumer internet access and content; consumer magazine subscriptions; entertainment (box office, home video, interactive television, recorded music and video games); newspaper subscriptions, satellite radio subscriptions.

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Appendix 3: Population numbers (Ireland)

Age Number0-14 827,42815-19 313,18820-24 328,33425-44 1,180,25945-54 480,44755-59 197,29460-64 154,25265+ 436,001

Source: Central Statistics Office, www.cso.ie

Appendix 4: Mobile Phone Population (4000 users)

Age Percentage15-24 18%25-34 23%35-44 21%45-54 17%55-64 11%65+ 10%

Source: Central Statistics Office, www.cso.ie

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http://www.cso.ie/

http://www.cso.ie/

Appendix 5: Interview with the Channel 6 media company

Minutes of our meeting with Michael MurphyMichael Murphy is behind a €10 million venture to launch a new TV channel in Ireland called Channel 6. Michael is a former TV3 and Eircom executive. His new channel hopes to take a large slice of the Irish audience that watch channels based in the UK. We started the meeting by giving him a demonstration of our product and we explained to him how it worked. Below are a couple of questions we had made out before our meeting with Michael. Michael answered these as the meeting progressed.

Q: Do you use video / images already?A: Michael did use video / images from elsewhere already. He used news agencies like Reuters do this. He made a point that it would be a good idea to form a partnership with a news agency or to have our system acting as an agency.

Q: How do you pay for these?A: The way he paid for this media was different for each piece and he said most of the time they would negotiate a price.

Q: What would you use this media for?A: He would use this media mostly for news programs but he was also interested in using mobile media for an entertainment program.

Q: Would you benefit from our system giving you better contact with the public?A: He believed he would benefit from our system giving him better contact with the public. The system would give him access to more media content and the system would have the public acting as reporters for him.

Q: Would you use people’s media content often?A: He noted how media from mobiles was beginning to be used on news programs more and more. This was highly evident in the week of the London bombings. He believed this was only going to increase over time as more people had access to camera phones and the quality of pictures from phones improved.

Q: Are you interested in our product?A: Yes, he was interested in our product and he was interested in forming a partnership with us later on. He also mentioned the possibility of making a program that would feature peoples interesting videos sent into his station using our system.

Q: Have you heard about any product similar to our product?A: No, he had not heard of any similar product to ours and he emphasised a number of times the importance of getting our product quickly developed and launched before anyone else.

Q: What area of television do you think you would use our product in?A: He thought that news and entertainment programs would benefit from our product most.

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Below are a couple of important points that Michael mentioned to us during the meeting:- We should develop a consumer product and a professional product.

- The best way to make our product professionally would be to link with a news agency, provide an archive service for the producer of a news program and to use license system that would cover our costs.

- The fact that the product was web based was fantastic. This meant that anyone in the world could use the system.

- The user GUI for the professional version would take a bit more work to allow producers to access media quicker. This meant actually making the interface a bit simpler to use.

- If we were selling a non-exclusive piece of media we should take 20%. We should then try to get as many people as possible to access this piece of media. If we were selling a piece of media exclusively we should take 30%. If the value of the piece was over €5,000 we should take less.

- Pieces of media should also have an archive value.

- Our consumer product could be a fun product and most of the media should not be filtered. Our professional product should have filtered media, which should be of high quality. This would require an editorial input. We may need to cut down and crop images. Better labelling of pieces of media should be included to allow for fast browsing of videos / images.

- The header should include a representative name of the video / image, the length of the piece and the quality.

- Our product should have good branding and marketing behind it. If we went in partnership with him he would give us a hand in these areas. For example, he suggested that Channel 6 would hire a marketing company for us and that we would be advertised on the television and in other media.

- If he went to develop a TV show using our product he would give us some of the revenue generated or advertising time.

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Appendix 6: Broadcasters

Ireland:1. RTE including TG42. TV3 3. Channel 6 (Launching in December 2005) aiming at 15 to 34 age group

UK:1. BBC (British Broadcasting Corporation) including World Service, News, beeb

@ the BBC (including the Radio Times and Comedy Zone), BBC Shop and Monitoring Service (summary of world broadcasts).

2. Bravo 3. Carlton Select (cable) 4. Cartoon Network 5. Channel 4 including schools and on-line chat 6. Channel 5 (new channel, Easter 1997) 7. Classic FM (radio - see also international stations) 8. Disney Channel 9. Freeview digital TV 10. IRN (Independent Radio News) - listen to the hourly news (in ReadAudio

format) 11. ITN (Independent Television News) - watch the world news (in RealVideo

format) 12. ITV (Independent TeleVision). Regions: Anglia, Border, Carlton, Central,

Channel, Granada, Grampian, HTV (Wales), LWT (London Weekend Television), Meridian, Scottish, Tyne Tees, Westcountry, Yorkshire.

13. Jazz FM (radio) 14. Landscape Channel from CableNet 15. Live TV (cable) 16. London News Network 17. MTV UK 18. NASTA (National Student Television Association) 19. Play UK 20. The Preview Channel 21. S4C (Welsh 4th channel) 22. Sky including Sky News and Sky Sports 23. Student Radio 24. TCC (The Children's Channel) 25. Television X (The Fantasy Channel) 26. Travel (Landmark Travel Channel) 27. Trouble 28. Vega Science Trust

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http://www.vega.org.uk/

http://www.trouble.co.uk/

http://www.travelchannel.co.uk/

http://www.televisionx.co.uk/

http://www.tcc.co.uk/

http://www.studentradio.co.uk/

http://www.skysports.com/

http://www.sky.com/news/

http://www.sky.com/

http://www.s4c.co.uk/

http://www.previews.demon.co.uk/

http://www.playuk.tv/

http://www.cs.bham.ac.uk/~amw/nasta/

http://www.mtv.co.uk/

http://www.lnn-tv.co.uk/

http://www.livetv.co.uk/

http://www.cablenet.net/

http://www.cablenet.net/landscape/

http://www.jazzfm.co.uk/

http://www.scottish.tv.co.uk/

http://www.meridian.tv.co.uk/

http://www.lwt.co.uk/

http://www.htv.co.uk/

http://www.granada.tv.co.uk/

http://www.centraltv.co.uk/

http://www.carltontv.co.uk/

http://www.border-tv.com/

http://www.anglia.tv.co.uk/

http://www.itv.co.uk/about/region.htm

http://www.itv.co.uk/

http://www.real.com/

http://www.itn.co.uk/video_on_demand/video_on_demand.htm

http://www.itn.co.uk/

http://www.realaudio.com/

http://www.irn.co.uk/listen.html

http://www.irn.co.uk/irn_news.ram

http://www.irn.co.uk/

http://www.freeview.co.uk/

http://www.disneychannel.co.uk/

http://www.classicfm.co.uk/cfmint.htm

http://www.classicfm.co.uk/

http://www.five.tv/

http://chat.channel4.com/

http://www.channel4.co.uk/schools/

http://www.channel4.co.uk/

http://www.cartoon-network.co.uk/

http://www.carltonselect.com/

http://www.bravo.co.uk/

http://www.monitor.bbc.co.uk/

http://www.bbcshop.com/

http://www.comedyzone.beeb.com/

http://www.radiotimes.beeb.com/

http://www.beeb.com/

http://www.beeb.com/

http://news.bbc.co.uk/

http://www.bbc.co.uk/worldservice/

http://www.bbc.co.uk/

http://www.tv3.ie/

http://www.tg4.ie/

http://www.rte.ie/

Appendix 7: Arbitro User Interface

Appendix 8: Sample image of from video capture using XDA mobile device

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Appendix 9: Using MMS to create TV shows based on the success of SMS-TV shows.

A survey32 suggests that 42 percent or more of the mobile-phone users, and up to 70 percent of the teenagers, in a number of Europe's largest TV broadcast markets are interested in some form of interactivity between TV and their mobile phones.

At present, SMS-TV messaging accounts for less than 2 percent of the €22 billion in gross annual advertising revenues generated in the European TV broadcast market. But broadcasters could be underestimating the greatest strength of linking SMS to TV: SMS is an effective direct-marketing tool and can also increase ratings. McKinsey studies found that adding SMS interactivity to certain shows improved their viewers' loyalty. In some cases, the addition of SMS boosted the viewer ship of popular free-to-air television shows by up to 20 percent. Since advertising rates are directly linked to ratings, well-executed SMS-TV shows could at least preserve, and perhaps enhance, a broadcaster's bottom line.

McKinsey studies demonstrate that if more than 5 percent of a show's viewers interact with it, its audience is extremely engaged—and more likely to tune in again, to tell friends about it, and even to spend money on show-related content or merchandise. Broadcasters can use their knowledge of SMS activity to accelerate their marketing efforts and to command higher prices for advertising slots.

In 2003, the 900 million messages sent in the European SMS-TV market generated an estimated €400 million for broadcasters, mobile operators, and technology providers, or about 5 percent of the total SMS market included in our research33. If the system's operational effectiveness were improved and if new shows, chat rooms, and shopping applications were developed, this market could easily be worth €750 million by the end of 2005. Broadcasters could capture one-third to one-half of that sum—€250 million to €375 million.

Europe is clearly the world leader in SMS-TV, and the market is growing. Studies of more than 60 SMS-TV shows in Western Europe suggest that, depending on the show's format, 5 to 15 percent of the total audience is converted from viewer to active SMS participant. The results of traditional marketing campaigns pale by comparison: the best-targeted ones might yield participation rates of 3 to 8 percent, while click-through rates for Internet advertising average from 1 to 4 percent.

More viewers will mean more advertising revenue. In a recent survey, about 58 percent of advertisers said they would allocate a larger proportion of their ad budgets to channels with attractive ratings growth resulting from the use of SMS (Exhibit 1). In addition, 46 percent of those advertisers would bring new money to TV, either by reallocating the money from other media or simply by making new investments. Our studies show that SMS interactivity can encourage ratings growth of 50 to 100 percent for niche cable and satellite channels. Advertising provides 20 percent of the revenues of the average thematic pay broadcaster, which can reasonably expect one out of

32 In January 2003, McKinsey surveyed 600 mobile users in Belgium, France, the Netherlands, Scandinavia, Spain, and the United Kingdom about interactive TV.33 In Belgium, France, the Netherlands, Scandinavia, Spain, and the United Kingdom.

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every five shows to be interactive. SMS interactivity can therefore boost the total revenues of a niche pay-TV broadcaster by 1.5 to 2.5 percent.

In the case of free-to-air channels, which depend on advertising sales for as much as 80 percent of their total revenue, McKinsey research shows that SMS interactivity can attract up to 20 percent more viewers. If 20 percent of the shows in a broadcaster's prime-time schedule won these increased ratings, TV advertising revenues would rise by €250 million across Europe—a significant amount, equalling the broadcasters' share of the viewers' text-message fees.

Adding SMS interactivity to TV programming presents broadcasters with technological and creative challenges. Typically, once a standard TV show is produced, it is packaged in an appropriate length and time slot and then distributed. An SMS-TV show adds an extra loop to this cycle: after it has been distributed, SMS users must be able to send information to the broadcaster, and this information must somehow be integrated into the show (Arbitro would do this). To achieve the full benefit of the technology, a broadcaster must therefore master three important elements (Exhibit 2).

Software technology

SMS data are received over the Internet, interpreted by middleware, and integrated into a TV show through software overlays. A show host might, for example, pose a question to viewers and instruct them to answer by typing 1-2-3 into their mobiles for "yes" and 4-5-6 for "no." The middleware translates the numbers, aggregates the results, and passes the data to another software application, which creates a graph that is overlaid on the broadcast screen (or on a related Internet site) to show the voting results.

Should a broadcaster buy the software technology or develop it in-house? In-house development has advantages such as greater control over the end product, but they must be weighed against outsourcing's benefits, which include access to upgrades. Since analysis indicates that costs are similar either way, the decision should rest on the type and complexity of the SMS application. If a broadcaster needs only a simple voting application—for a music video show, say—off-the-shelf software will suffice. TV broadcasters have used middleware for fixed-line voting since the early 1980s, and middleware providers, mainly small software companies that were early players in the fixed-line market, have already developed excellent off-the-shelf products. Moreover, these providers are well versed in interactive voice recognition and understand the broadcasters' needs.

If it is vital to integrate an SMS application tightly with distinctive broadcast content—for example, in a live talk show—the broadcaster might choose to have more control over the process and would thus develop its own technology. But even when middleware and other kinds of software are developed in-house, broadcasters should make the technology flexible enough to use in a number of interactive applications: a voting application, for example, could be reused for a game show format. Many large, first-mover broadcasters, such as Norway's TV2, have developed software solutions in-house and then sold them to other broadcasters.

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Conclusion

Ten years ago, industry experts saw unlimited potential for interactive TV and for broadcasters that could execute it well. To date, progress in Western Europe has been hindered by the slow penetration of digital TV. But in the meantime, more than 75 percent of all Europeans own SMS-enabled mobile handheld devices, and SMS-TV, which doesn't require digital broadcasts, is giving broadcasters and mobile operators an important first lesson in interactivity. Thus prepared, they will be able to take full advantage of the new medium by advancing to the next generation of technology—Enhanced Messaging System—and then to Multimedia Messaging Services.

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2 business strategy - dcu school of computingasmeaton/mecpracticums2005/… · web view2.2...

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