• by John Gaffney , May 28, 2002

According to research firm ICA Syndicate, convergence is becoming more than an overused concept. It needs to become a business strategy for content distribution, and potentially, media planning.

“The fusion of the global telecommunications system, the networks delivering broadcast and cable television, and the Internet is already here in many aspects,” the report states. “On one hand, this new revolution won't be as destructive to content producers as the Internet has been. On the contrary, it will bring back a more rational pricing model in which quality content is in high demand and ubiquitous in its availability. At the same time, however, the changes it brings to the content industry will be just as dramatic and just as far-reaching.”

In this post-convergence world, ICA predicts that the companies that prosper will be those that produce high-quality content and also strike early to refashion their content to new delivery protocols, partner with distribution and platform leaders, diversify their revenue streams and take advantage of new technologies. “The convergence of voice, data and video is still, from a technology and delivery standpoint, at least two years away from reality, and at least four years away from the beginnings of mass-market adoption,” the report states. “From an investment horizon standpoint, that might as well be tomorrow.”

The report also addresses the new competitive landscape in the media world. Effective competition, whether its Amazon vs. Barnes and Noble or Travelocity vs. the travel agents will depend on proactive, strategic planning, creative product enhancements, effective marketing and product placement, the building of sound distribution and platform partnership.

“Creating those winners will be as much about mergers and acquisitions as it is about marketing and infrastructure investments,” says the report. “Content producers will gain more leverage among those service providers if they can expand their product offerings through acquisitions. While voice content won't fit into their merger plans, content production companies will nonetheless have to reach out to all three for platform adherence and interoperability.”