Cloud To Fuel The Future Of Media And Entertainment A COMMISSIONED STUDY CONDUCTED BY FORRESTER CONSULTING ON BEHALF OF AWS MARKETPLACE, NOVEMBER 2023
© FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. In June 2023, AWS Marketplace commissioned Forrester Consulting to evaluate the role of cloud solutions in the media and entertainment (M&E) industry. Forrester conducted an online survey with 623 respondents and six in-depth qualitative interviews with technology strategy decisionmakers at global organizations to explore this topic. We found that purpose-built platforms, cloud solutions, partner networks, and marketplaces help M&E companies overcome hurdles to security, skills, and scale to boost customer experience (CX) and competitive advantage. Executive Summary
© FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Key Findings M&E firms are accelerating their cloud adoption. The need for better CX, content capabilities, and differentiation in a competitive landscape is rapidly driving this shift. Security, skills, and scale hold back greater cloud usage. As M&E firms accelerate cloud adoption, they’re feeling the effects of legacy systems and capabilities shortages. Firms are putting their weight behind the cloud. M&E firms realize the future importance of cloud-based capabilities and are investing in better solutions. In doing so, they expect greater operational efficiency, real-time insights, and content pipelines and archiving, with the ultimate payoff being improved CX and competitive advantage. Marketplaces and partner networks offer a critical role in M&E. M&E decision-makers plan to adopt and expand their use of software and data marketplaces for stronger CX, improved real-time insights, and greater ability to fill critical capability gaps with tool sets.
4 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Respondents said new differentiation remains the top industry priority as their organizations look to accelerate pipelines, delight customers, and diversify business models. Top Organizational Priorities Over The Next 12 Months (Showing “High priority” and “Critical priority”) Improving experience of consumers/ customers Improving our differentiation in the market Adopting better data and analytics capabilities 85% 80% 77% Base: 623 global technical and business decision-makers in media and entertainment Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023
5 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 40% 56% do not feel their organization is satisfied with its speed of delivery. However, M&E firms are playing a game of catch up when it comes to modernized systems and their technology infrastructures. do not feel their organization is prepared to compete today with its current infrastructure. Base: 623 global technical and business decision-makers in media and entertainment Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023
6 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. They’re also using a mix of cloud models and strategies, leading to a chaotic and inconsistent technology landscape. Base: 456 global M&E decision-makers with implemented cloud-based technology systems Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023 23% 29% 40% 61% Private Public Hybrid (public and private) Multicloud Currently using 13% 37% 44% 61% Private Public Hybrid (public and private) Multicloud Planning to use Base: 167 global decision-makers planning to implement cloud-based technology systems Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023 14% 36% 50% “It’s fragmented. … Teams are given their own functionality and their own stuff. We lose negotiation power … since teams across the company sometimes use [different providers]. … How do we get smarter? We have a workforce that’s an expert in one or the other.” — Director of advertising strategy, cable and streaming media We have a central cloud strategy (including product decisions). Teams/business units within the organization make independent cloud strategy decisions. We have a mix between central cloud strategy and teams making independent decisions.
7 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Across content production, analytics, and direct-toconsumer (D2C) streaming, M&E firms suffer from similar challenges touching security, skills, and scale. Top Technology Challenges Organizations Experience 37% 41% 43% Limitations stemming from data volume Software/systems are inconsistent/unreliable /nonperformant My organization has concerns that new technology brings new security/risk challenges 36% 37% 45% Scaling/expansion costs My organization has concerns around security and risk My organization lacks key technology skill sets 34% 39% 45% Pipeline integration challenges My organization has concerns around security and risk My organization lacks key technology skill sets Media/Content Production Analytics D2C Streaming Base: 623 global technical and business decision-makers in media and entertainment Note: Showing top three responses per type of challenge Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023
8 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. It’s these three S’s that hold M&E firms back from improving their infrastructure. Security Skills Scale
9 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. • Cloud strategies have often been emergent. • Cloud will not be a “one-team strategy.” • IT might not meet the speed of the business. • The business might be replicating work. • Current models are not scalable. This means: The result is: • Excess cost. • Reduced resources available. • Increased vulnerabilities. • Reduced effectiveness of utilization. Security Skills Scale
10 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Ultimately, these challenges stifle content pipelines, CX, and business performance. “We have a lot of tech that is either dated or used by legacy customers that we haven’t transitioned off, and that’s just multiplied.” —Director of advertising strategy, cable and streaming media Organizational Consequences Given Their Technology Challenges Base: 623 global technical and business decision-makers in media and entertainment Note: Showing top nine responses Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023 32% 32% 33% 34% 35% 35% 37% 40% 45% Weaker content supply chains Weaker ability to compete/differentiate Poor partner experience (e.g., misalignment, difficulty communicating) Misalignment of strategy across the business Routine digital platform failures Growing cost of doing business Poor customer experience Weaker ability to build content pipelines Weaker organizational efficiency/productivity
© FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. To address these shortfalls, M&E firms are turning to the cloud with urgency to infuse content capabilities, agile storage, and modernized operations at scale into how they work. Those increasing investment by less than 10% are in for a nasty shock when they realize that simply won’t be enough. “Our strategy is move as many workflows as possible to the cloud.” —Senior director of technical services, streaming and broadcast media said it’s important that their organization uses cloud-based technology solutions. 80% 34% plan to increase their cloud-based technology investment by more than 10% over the next year.* Base: 623 global technical and business decision-makers in media and entertainment *Base: 456 global decision-makers with implemented cloud-based technology systems Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023
12 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Why are firms turning to the cloud? The most successful cloud firms — organizations that have been successful or very successful with their cloud-based technology to date —experience even greater benefits. Base: 456 global decision-makers with implemented cloud-based technology systems Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023 Compared to laggards, respondents from successful implementers of the cloud report that: • “My organization’s satisfied with how it engages customers.” • “Using platforms like marketplaces is an effective way to purchase technology to meet my organization’s industry needs.” • “My organization feels prepared to compete today with its current technology infrastructure.”
13 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Though only one in five M&E decision-makers call the cloud mission critical today, this figure will jump to one in three in 2024, underscoring the cloud’s increasing importance toward accelerating key business objectives. Importance Of Cloud-Based Capabilities To Organizations (Showing “Mission critical”) 18% 34% Right now One year from now +16% Base: 623 global technical and business decision-makers in media and entertainment Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023
14 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. These cloud benefits include greater CX, efficiency, and differentiation, which enable future-fit M&E strategies. “We’re investing more in resources to power DTC services —investing in the cloud and infrastructure, acquiring rights in a smart way, and security with customer data.” —Director of platform distribution, cable, streaming, and broadcast media “The digital platform is the future we’re betting on.” —Senior director of technical services, streaming and broadcast media Expected Benefits From Investing In Cloud-Based Technology Base: 623 global technical and business decision-makers in media and entertainment Note: Showing top nine responses Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023 35% 36% 37% 37% 38% 38% 40% 43% 49% Improved security Improved technology consolidation Improved ability to measure ROI Improved ability to scale operations Improved real-time communications Improved content archiving Increased ability to generate realtime insights Improved direct pipeline integration across media partners Improved operational process/operational unit agility and efficiency
15 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. 56% planning to adopt/are adopting/ expanding their use of marketplaces. Similarly, over half of respondents reported expanding/upgrading their use of marketplaces or planning to implement in the next 12 months. “[Marketplaces are] a focus. [We’re] trying to determine how can we offer additional value and efficiency with video ad customers in a data marketplace where they can find new sources of data or vendors that have been approved and can run within our tech environment.” — Director of advertising strategy, cable and streaming media Base: 623 global technical and business decision-makers in media and entertainment Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023
16 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Firms that have already adopted marketplaces have experienced better CX, insights, access to capabilities, and organizational agility, which are all critical to achieving key business goals and connecting IT to the business. “[With marketplaces,] we can put the power back in the hands of the retailer or ad buyer because we don’t want to get in the way of the customer in every interaction.” —Director of advertising strategy, cable and streaming media Realized Benefits Through Using Software And Data Marketplaces Base: 410 global technical and business decision-makers in media and entertainment who use marketplaces Note: Showing top seven responses Source: A commissioned study conducted by Forrester Consulting on behalf of AWS, July 2023 40% 44% 47% 50% 54% 58% 64% Improved employee/partner experience Increased availability of media and entertainment-specific cloud tooling Accelerated content creation/publication pipelines Increased business unit agility due to new tooling Better access to features/tools we otherwise would not have access to Increased ability to generate real-time insights Improved customer experience
17 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. So, what should M&E firms prepare for as they look ahead? A cloud strategy that accounts for AI. “People want a more immersive experience of the genres they love, gaming included. Gaming is the most expensive form of engagement going forward in five years. But does it work in an ad environment where you create a new experience and decrease the cost to serve?” — Director of advertising strategy, cable and streaming media “Interoperability is a challenge facing the industry. Complementary services between different software stacks. … If you commit to [one cloud brand] is [another brand] compatible with AI? I think that’s critical three to five years ahead.” — Director of platform distribution, cable, streaming, and broadcast media “Last year, I did an analysis on how many editing hours we used doing highlights/clips. We spend more than 10,000 hours a year doing this. If we can find an AI system to do it for us … man, do the numbers, right?” — Senior director of technical services, streaming
18 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. What else can M&E firms do to improve their use of the cloud? Key Recommendations Create a federated cloud strategy to tackle larger cloud problems. As M&E firms have adopted cloud, emergent need has frequently driven implementation. This might have been guided by things like a central cloud strategy, but IT and the business have been adopting in silos, resulting in repeat work, fragmented security posture, and a lack of available skills. As cloud strategy matures and adoption accelerates, your M&E firm will need to mature its practice, with IT focusing on platform enablement and platform engineering and the business becoming more effective at coordinating initiatives. Leverage partner networks and marketplaces to fill in key capability gaps. Key to an effective cloud strategy is prioritizing the development of business differentiating capabilities. Marketplaces and partner networks help businesses refocus on this, meeting broader vertical- and production-specific needs with specialized cloud apps and capabilities and resulting in a faster time to market than the usual build-ityourself approach.
19 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. What else can M&E firms do to improve their use of the cloud? Key Recommendations Secure your approach through Zero Trust. The principles of Zero Trust must be adopted during development, deployment, and migrations, not after. Reactively managing for cloud security will be a losing battle and impede your organization’s initiative. Start by eliminating implicit trust and instead treat all entities as untrusted. Enforce least-privilege access across human, machine, application, and computing infrastructure identities. Implement comprehensive security monitoring through specific cloud security monitoring solutions to overcome ephemeral asset gaps. Finally, attach and enforce cloud security through cloud management solutions. These foundations build the foundation for a Zero Trust cloud. Develop a cloud platform group. Similar to the federated cloud strategy of adoption, a cloud platform team should be created to build out automation, develop and identify needed policies, and bulk out internal skills. Different from a traditional IT team, a platform team must continuously strive to exceed developer and customer expectations. A focus on automation, policy, and skills will ensure your organization overcomes some of the more difficult-to-solve cloud challenges.
© FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. In this study, Forrester conducted an online survey of 623 respondents and six interviews with decisionmakers at global organizations to evaluate the role of cloud solutions in the media and entertainment industry. Survey participants included technology strategy decision-makers in manager positions and above in business and IT roles. Questions provided to the participants asked about organizational priorities, challenges, cloud usage, and investment plans. Respondents were offered a small incentive as a thank-you for time spent on the survey. The study began in June 2023 and was completed in July 2023. Methodology Project Team: Jason Daniels, Market Impact Consultant Steve Mullahoo, Associate Market Impact Consultant Contributing Research: Forrester’s Technology Architecture & Delivery research group ABOUT FORRESTER CONSULTING Forrester provides independent and objective research-based consulting to help leaders deliver key outcomes. Fueled by our customer-obsessed research, Forrester’s seasoned consultants partner with leaders to execute their specific priorities using a unique engagement model that ensures lasting impact. For more information, visit forrester.com/consulting. © Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester®, Technographics®, Forrester Wave, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. [E-57170]
21 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Demographics Company Revenue More than $5B 1% $1B to $5B 26% $500M to $999M 33% $400M to $499M 19% Less than $400M 21% Respondent Level C-level 10% Vice president 16% Director 34% Manager 40% Number Of Employees 100 to 499 14% 500 to 999 26% 1,000 to 4,999 35% 5,000 to 19,999 15% 20,000 or more 10% Department Operations 23% Marketing/advertising 22% IT 20% Sales 19% Financial/accounting 16% Regions North America 50% EMEA 33% APAC 17% Note: Percentages may not total 100 because of rounding.
22 © FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Demographics Tech Strategy Responsibility Final decision-maker 38% Part of the decisionmaking team 30% Influence decisionmaking 31% Top 3 Subindustries Broadcast media 83% Streaming media 78% Cable media 77% Top 3 Respondent Teams Analytics 23% Content production 22% Direct-to-consumer streaming 21% Cloud System Plans Expanding/upgrading 48% Implemented 24% Planning to implement 27% Note: Percentages may not total 100 because of rounding.
© FORRESTER RESEARCH, INC. ALL RIGHTS RESERVED. Download the full study: “Cloud To Fuel The Future Of Media & Entertainment: How Modern Infrastructures, Partners, and Marketplaces Enable Security, Skills, and Scale” Read now Explore More RELATED FORRESTER RESEARCH “The CIO’s Cloud Strategy In 2023,” Forrester Research, Inc., March 1, 2023. “Scoring Our 2022 Cloud Predictions,” Forrester Research, Inc., February 22, 2023. “Navigate The Cloud-Native Ecosystem In 2022,” Forrester Research, Inc., October 25, 2022.
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