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Questions answered in this chapter:


Regional ISPs: BellSouth, NYNEX, Pacific Bell ... as an 'electronic wallet' or to check on stock quotes, which requires relatively ... – PowerPoint PPT presentation

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Title: Questions answered in this chapter:

Chapter 15 The Future of Media Usage
  • Questions answered in this chapter
  • What is meant by the digital lifestyle?
  • How will broadband technology impact Internet
  • What are the differences among the following
    Internet-delivery mechanisms digital subscriber
    lines (DSL), cable lines, and satellite?
  • Which household device will serve as the gateway
    to the Internet?
  • How will increased wireless communications,
    video-on-demand, and personalized media content
    further fragment media usage?
  • How will the increased size of media companies
    allow them to capture efficiencies of scale among
    diverse audiences?

Network and Media Convergence
  • Digital Convergence
  • Network infrastructure convergence is
    characterized by the ability to share and
    transport information
  • Digital telephones
  • Digital radio
  • Digital television
  • Computers
  • Media convergence is characterized by mergers
    among alternative media companies
  • Radio networks
  • Television networks
  • Magazine and newspaper publishers
  • Film producers
  • Online companies

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Digital Lifestyle
  • Bill Gates (Microsoft Corp.) believes that the
    personal computer, the set-top box for
    interactive television, and the video-game
    console will all be important household devices
  • Craig Barrett (Intel Corp.) thinks about an
    extended PC era, with consumers adopting PC
    accessories such as the digital camera, personal
    digital assistants (PDAs), and digital sound
  • Steve Jobs (Apple Computer, Inc.) envisions the
    PC as the homes Internet portal, the digital
    hub, where consumers could edit their own movies
    or create customized CDs with easy-to-use
  • Nobuyuki Idei (Sony Corp.) believes that personal
    electronic devicessuch as the PlayStation 2
    video-game consolewill be the future digital
    command centers for the home

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Analog and Digital Information
  • Analog signal is a continuous variable
  • Voice over telephone wires, broadcast radio,
    broadcast television
  • CODEC analog signal can be digitized through an
    analog-to-digital conversion process (coding) and
    can be put back into analog through a
    digital-to-analog conversion process (decoding)
  • Processing analog signal involves various
    signal-filtering techniques to reduce background
  • Analog signal is difficult to compress

Analog and Digital Information (contd)
  • Digital signal is a discrete variable represented
    by 0 or 1
  • Computers, digital cell phones, digital cameras,
    scanners, printers
  • MODEM digital signal can be converted to analog
    (modulation) and can be put back into digital
  • Digital signal can be copied, processed, and
    manipulated virtually without any loss in quality
  • Digital signal is easy to compress

Applications of Broadband Technology
  • Broadband technology is usually defined as having
    a connectivity speed exceeding 128 kilobits per
    second, significantly faster than the narrowband
    speeds of up to 53 kilobits per second achieved
    over regular telephone lines
  • The increased use of broadband technology will
    allow for more applicationssuch as
    video-on-demand, multiplayer games, streaming of
    audio and video, and software distributionto be
    offered over the Internet
  • At the beginning of 2000, Nielsen//NetRatings
    estimated that only 5.1 million American
    households had access to broadband technology
  • By the end of 2005, the Yankee Group projects
    more than 30 million Americans will have access
    to broadband

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Internet Service Providers (ISPs)
  • National/international ISPs America Online
    (AOL), EarthLink, Microsoft Network (MSN)
  • Regional ISPs BellSouth, NYNEX, Pacific Bell
  • Local ISPs Access Internet Communications in
    Cupertino, CA Montana Communications Network in
    Bozeman, MO
  • By the middle of July1999, there were an
    estimated 6,000 ISPs in North America
  • In December 2000, AOL was the largest ISP in the
    United States with more than 29 million members,
    followed by EarthLink, MSN, ATT, and NetZero

Digital Subscriber Line (DSL)
  • DSL allows for high-speed connections over
    existing copper telephone wires
  • DSL requires special modems on each end of the
    connection, in the users home and at the
    telephone companys central office
  • DSL modems send and receive all data as digital
    datano translation to analog signal ever takes
    placeallowing for faster data transmission
  • DSL divides the phone lines into several channels
    which enables to talk on the phone and use the
    Internet simultaneouslyall over a single phone
  • DLS modems must be within about 3 mile distance
    from each other
  • Data transmission speed over a DSL line is about
    1.5 Mbps

Cable Modem
  • With the use of special modem, the Internet can
    be accessed over some cable TV systems through
    the existing coaxial cable that carries TV
  • By replacing the coaxial copper with fiber-optic
    lines, cable operators could improve signal
    reliability and reception quality, increase
    channel capacity, and support the introduction of
    two-way interactive services
  • Cable modems send and receive data at speeds of 2
    to 3 megabits per second

Satellite Transmission
  • Types of satellites used geostationary (22,000
    miles above the earth), medium earth orbit (1,000
    to 10,000 miles), low earth orbit (500 to 1,000
  • Require sophisticated subscriber antennas
  • Downstream access at speeds up to 1 Mbps
  • Upstream access is available only by modem or
    other landline connections through ISPs

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Gateway to the Internet
  • Devices that are likely to serve as the household
    command center include the personal computer,
    video-game console, and interactive TV set-top
  • Currently, the PC is the primary gateway for most
    people to access the Internet
  • At the end of 2000
  • Approximately 55 million U.S. households (53)
    had personal computers
  • Approximately 35 million U.S. households (34)
    had Internet access
  • There were approximately 62 million individual
    Internet users in the U.S.

Video-Game Consoles
  • PlayStation 2 is a video-game console with the
    potential to access a wide range of broadband
    services on the Internet
  • In addition to being a video-game player,
    PlayStation 2 could function as a SC and DVD
  • With their Play Stations, users should be able to
    bank, shop, and e-mail through a television set,
    as well as download, store, and replay digital
    music and video from the Web
  • In addition to a hard drive, the PlayStation 2
    has built-in firewall ports, which will allow
    it to transfer data from camcorders, digital
    cameras, and other PC peripheral devices in the

Interactive Television
  • Currently, AOL and Microsoft offer basic
    interactive TV services that allow users to
    access e-mail, chat, and surf the Internet with a
    set-top box and dial-up modem while watching TV
  • Forrester Research projects that by 2005, 40
    million households will have access to digital
    set-top boxes, almost an eightfold increase from
    the 4.9 million households that had access to
    set-top boxes at the end of 1999
  • In addition to interactivity, video-on-demand
    will become more widely available, whereby
    consumers can choose to watch any movie or
    television show at any time and can even pause in
    the middle of it

Media Usage Fragmentation
  • Forecasters see mobile wireless technology as one
    of the fastest-growing alternatives to PCs for
    accessing the Web, especially when it is used as
    an electronic wallet or to check on stock
    quotes, which requires relatively low bandwidth
  • Palm-size computers as well as cell phones are
    now enabled to receive wireless data through the
  • Wireless Web technology will be less likely to
    take off in the United States, where 55 percent
    of the population accessed the Internet through
    desktop computers, compared to 25 percent in
  • Only 32 percent of all Americans have cell
    phones, compared to 45 percent in Japan, and 65
    percent in Finland

Media Content of the Future
  • With the continued fragmentation of media usage,
    mergers of content-based media companies will
    continue as a way to reach different segments of
  • The merger of AOL and Time Warner will allow the
    company to reach an estimated 60 percent of all
    American households through its magazines, cable
    television, movies, books, or online service
  • AOL Time Warner reaches 29 million households
    through its online service and 14 million through
    its cable systems, owns 40 magazines through Time
    Inc., has 37 million subscribers to its HBO
    channel, and reaches 12 percent of all moviegoers
    through Warner Bros Studios
  • The companies that create the network
    infrastructure will also dominate the media
  • Sony acquired CBS records and Columbia Studios in
    the late 1980s
  • Microsoft developed the MSN Network and has a
    stake in MSNBC News Channel

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