By: Scott Fedale, Janet Poley, Jeff Poley

January 30, 1998
Dallas, Texas

Goals for today’s talk

Understand convergence and interoperability

Understand Harvard Business School model

Develop & review of ADEC options & choices

Decisions ?

What is ADEC’s Strength?

Content

Content

Content

So How Do We Maximize our Strength?

Challenge

How can ADEC most efficiently deliver the content that we package to our audiences?

Harvard Business School Model

content

packaging

transmission network

manipulation infrastructure

terminals

What's Going On?

Convergence of:

• 1890’S - TELEPHONE
• 1930’S - TELEVISION
• 1980’S - COMPUTING

The changing structure

Now:

• content-specific distribution, provided by unique technologies, hardware and methods

Future:

• content-independent distribution, provided by a common infrastructure

Content

Communities of interest/dominant market position

Will capture more of total industry value

But will remain a collection of largely independent businesses

Packaging

2 Types

• technically oriented systems integrator
• distribution packagers
  • MTV, AOL, ADEC

Caveat

If you don’t control the packaging of your content, you risk losing intellectual property rights

Transmission

How can ADEC most efficiently deliver the content we package?

Options?

• Bid w/ commercial providers
• Aggregate our own demand for most bandwidth/least cost

Manipulation

Software in the network

Other software

ADEC needs to influence how this develops

We need to do the manipulation, not be manipulated

Terminals

Convergence of present options

• ex.-set-top boxes

Appliances will replace the old proprietary ones

• (phone, computer, tv)

IRD’s via commerce match

Importance of "first mover" advantage

If we’re not providing it, someone else will!

Partnerships made now will pay off in long term

Earlier we partner, more advantage to ADEC

Why "Provide Our Own"?

We Control:

• Aggregating our content
• Packaging our content
• Cost of transmission
• Marketing

Standards and Interoperability?

Move towards common transmission platform results in issues of proprietory standards

• Ex.-digital compression-
  • Europe/U.S.
  • In U.S.-Digicyper/Magnitude/Weggener/ Spectrum Saver/Powerview

Options for ADEC

Continuum from collaboration, capacity building, etc. to aggregated content and marketing.

• ( MTV model )

Decisions?

Current behavior not economical

• Proprietary standards, equipment
• State designed tranmission systems
• Lots of individual, small buys of time-wired/wireless
• Duplication of programming
• Chasing small $$$$$
• Not making a decision is a decision!

Results of No Decision

Limits our ability to take part in:

• Allocation of digital spectrum
• 4-7 % Educational allocation on DBS
• Public interest/education-commercial broadcast digital tv
• Internet II
• Rural Access
• Increased program distribution

So What Do We Recommend?

Raise investment capital to develop shared system

More human capital in programming, marketing, management

????????????????????????????