Cloud Computing for the Media and Entertainment Industry

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Cloud Computing for the Media and Entertainment Industry
IBM Sales and Distribution       Media and Entertainment
Thought Leadership White Paper

Cloud Computing
for the Media and
Entertainment Industry
Cloud Computing for the Media and Entertainment Industry
2   Cloud Computing for the Media and Entertainment Industry

Contents                                                           Media cloud evolution
                                                                   As a result of these challenges, media executives are having to
1   Executive Summary
                                                                   rethink their supply chain. We are learning that the troika of
4   Introduction                                                   service-oriented architecture (SOA), digital supply chain, and
                                                                   cloud is evolving into the blueprint for enjoying innovation
8   IBM takes a leadership role to address cloud industry
    issues and challenges                                          with the potential to reduce capital expense and operating
                                                                   expense. This triad of technologies, SOA, digital supply chain,
13 IBM recommendations for successful cloud                        and cloud will enable media companies to keep pace with
27 General recommendations                                         turbulent times by providing:

29 IBM Global Business Service cloud “get started” and
                                                                   •   Faster time to market
   “keep going” offerings
                                                                   •   Increased sales by increasing exposure to content
30 Cloud computing resources                                       •   A richer flow of information to adapt quickly to changing
                                                                       consumer interests and demand
                                                                   •   Decreased labor, inventory, and working capital costs
                                                                   •   Faster, fresher content packaged, identified, and available to
Executive Summary                                                      the right consumer anywhere, anytime
Challenges facing media executives
These are very turbulent times for media executives. Media         Content that is available “forever” as deep catalog or digital
CEOs are having to adapt their business models at an               inventory that has the potential able to produce a revenue
unprecedented rate. How will media companies manage to             stream over the Long Tail or for years to come.
keep pace with the ever-accelerating rate of innovation? How
will media companies maintain competitive advantage over           Media companies are looking for ways to innovate without
new entrants? Are there cloud consumption models that are          compromising their content ownership and digital rights.
appropriate for media companies to pursue? Should media            Cloud providers must be aware that security and content
companies be leaders or adopters?                                  protection are key issues that media executives care about.
                                                                   IBM® has been involved in cloud computing from the
Market forces and landscape of media                               beginning, was one of the original co-authors of the Cloud
and entertainment                                                  Manifesto in 2009, and continues to be the media and
The new reality is that the consumer is in the eye of the storm.   entertainment industry’s trusted partner: a partner that
Where there was once a scarcity of content, now there is a         brings innovation when and where it provides value; not
seemingly unlimited supply coming from traditional media           technology for its own sake; and, only when it strengthens
sources as well as new media and social network Internet sites     clients’ strategic goals and objectives. IBM provides facilities,
via more and more portable consumer devices. It is estimated       hardware and software, and professional services to match our
that by 2012 there will be one trillion devices connected to the   clients’ needs, budget and their optimal cloud deployment
Internet and 50 billion of them will be mobile phones.             model. IBM appreciates that media consumers, along with
                                                                   media assets, both hold the highest value to media companies.
Cloud Computing for the Media and Entertainment Industry
IBM Sales and Distribution   3

                                                                        •   Provide e-commerce and storefront capabilities with ad
                                                                            insertion capability.
IBM has been involved in cloud computing                                •   Support subscription and pay-per-view models.
from the beginning, was one of the original                             •   Maintain control over the cloud’s content delivery resources:
co-authors of the Cloud Manifesto in 2009,                                  Prevent rogue applications from over-consuming resources
                                                                            using SOA governance capabilities.
and continues to be the media and                                       •   Integrate enterprise legacy and backend systems—such as
entertainment industry’s trusted partner.                                   enterprise resource management (ERP), customer relationship
                                                                            management (CRM) and supply chain management (SCM)—
                                                                            with external cloud services.

Working closely with our clients, IBM continues                         Why IBM?
to extend digital supply chains reliably and securely to create         IBM appreciates that the journey will be different for each
new revenue streams that pursue the right customers with                media company. IBM is a trusted partner offering proven
the right content.                                                      technology, products, and professional services. IBM is focused
                                                                        on creating value and delivering meaningful solutions. Media
“What do I have to do?”—IBM Recommendations                             companies and IBM share the key values of reliability and
Media companies must understand where they are in
                                                                        security. IBM is a global company that supports open
developing their digital supply chain and how they can best
                                                                        standards, oversees complex projects, brings relevant emerging
utilize SOA and cloud computing to augment and improve it.
                                                                        technologies to market, and stays in the trenches with our
The application of technology to enrich the digital supply
                                                                        clients from the development of strategy through the ongoing
chain and to improve competitive advantage will depend upon
                                                                        implementations of new solutions and business models.
a wide variety of factors. However, a generic strategy for a
media company might include combinations of these elements,             IBM believes that enhancing the digital supply chain with
all of which are related to digital supply chain, and all of which      cloud computing holds the key to providing cost-effective,
IBM has a history of successfully delivering to media clients:          extra-enterprise content processing services that can extend
                                                                        and enhance media companies’ core competencies and enable
•   Build digital archives (convert analog assets to digital assets):
                                                                        them to compete and thrive in today’s consumer-centric
    Digitize assets, store them on-site and off-site applying best
                                                                        marketplace. Cloud computing represents a fresh approach to
    practices in storage and asset management.
                                                                        outsourced and managed services solutions, which have long
•   Leverage the digital archive to support on-going production
                                                                        been salient IBM capabilities. This paper is intended to provide
                                                                        media executives with new business insights into how cloud
•   Protect assets using encrypted communications
                                                                        computing can extend their core enterprise capabilities, and it
    (authentication, authorization) and the encryption of content.
                                                                        will provide some guidance, current and future offerings and
•   Provide analytics to support pricing, product mix, release date,
                                                                        step-by-step recommendations for help along the unique
    and placement decisions.
                                                                        journey each company will take to reach its goals.
•   Provide separate portals for business-to-business (B2B) and
    business-to-consumer (B2C) processes to support branding
    and consumer experience.
Cloud Computing for the Media and Entertainment Industry
4   Cloud Computing for the Media and Entertainment Industry

Introduction                                                      targeted consumers. In other words, media companies are
Today, economic pressures are forcing media companies             looking to the cloud to enhance their digital supply chain—
to alter the way they do business. We live in an “attention       adding specific media processing services—while reducing
economy” and compete for the ever-changing attention              operating expenses. There is considerable talk about how cloud
of consumers. Our customers and consumers are more                computing can help reduce capital expenses; however, this is
demanding and less loyal than ever before. Advertising as a       less likely for large, mature media companies than it is for
source of revenue isn’t what it used to be. Media companies       small-to-medium media companies. Small-to-medium
cannot simply raise prices or sell more advertising to attain     businesses (SMBs) are likely to be more eager to outsource
profit goals, and there is not much room left to cut from         content storage and content processing than the very large
operating expenses. In today’s economy, there is an increased     media companies since it is difficult to increase capital and
focus on the effectiveness of digital supply chains. However,     operating expenses. Large media companies are likely to have
merely reacting well in today’s attention economy is not          developed highly efficient custom enterprise systems that are
sufficient to survive financially.                                not likely to be replaced by generic or composite services in
                                                                  the cloud. Also, large media companies are likely to have
Media CEOs are adapting their business models at a rapid          decentralized storage pools in multiple physical data centers
pace. How will media companies keep up with the ever-             presenting access complexities and limitations. There is also
accelerating rate of innovation in the new economic               the issue of how much content is still in analog formats.
environment? How will media companies maintain competitive        However, no media company can afford more capital expenses
advantage over new entrants? Are there cloud consumption          merely to accommodate seasonal needs or for resources that
models that are appropriate for media companies to pursue?        are not fully utilized.
Should media companies be leaders or adopters?
                                                                  The greatest opportunities for media companies are available
                                                                  wherever content storage, media processing and distribution
                                                                  services are co-located. Just as economies of scale become
Using cloud computing, media companies are                        available to media companies seeking to reduce their cost per
developing new and better ways to quickly and                     gigabyte (GB) to $0.10 or less, processing services economies
                                                                  of scale become available when the range and intensity of
efficiently deliver content to fine-grained                       content services are co-located with the content itself. For
targeted consumers.                                               example, it is becoming clearer that processing services are not
                                                                  standalone services. If large video files need to be transcoded, it
                                                                  is probably not cost effective to merely transcode these files
                                                                  since the communication costs may be too great. However,
Media companies are responding with new ways to enhance
                                                                  when transcoding services and other content processing
their digital supply chains using cloud computing. Using cloud
                                                                  services are co-located with the content, the communication
computing, media companies are developing new and better
                                                                  costs become a proportionately smaller part of the overall cost.
ways to quickly and efficiently deliver content to fine-grained
Cloud Computing for the Media and Entertainment Industry
IBM Sales and Distribution   5

Media companies will need to prepare themselves to make the        The new reality: Consumers at the eye of the storm
journey and take advantage of these evolving media clouds.         Today, the traditional economics of media have been
While few media clouds exist today, they will evolve over time     overturned. Before the Internet, there were limited sources of
along paths of greatest return, in terms of time to market and     content, or what Bob Garfield, author and long-time writer for
the ability to distribute more B2B and B2C content to more         Advertising Age, has called the “age of scarcity.” Today, the
consumers for the least investment.                                supply of content is greater than the demand. Advertising alone
                                                                   cannot support media delivery. As new business models
                                                                   emerge, it is clear that the consumer is at the eye of the storm.
                                                                   Content that cannot be discovered and easily located, played or
Cloud computing represents many                                    downloaded will be forgotten. Media executives now must
opportunities for media companies to improve                       rethink their supply chain: The emphasis is on the assets rather
their competitive advantage by getting content                     than the medium and consumers are no longer dependent on a
                                                                   dominant medium for the content they want.
to multichannel, three-screen (or even
four-screen) markets faster than ever before                       What is the most efficient way to get content to consumers?
while potentially reducing costs.                                  What is the best way to reduce time to market? The supply
                                                                   chain of the past, which focused on the distribution of content
                                                                   after it was created, is being inverted to focus on the consumer.
                                                                   IBM believes its key differentiator is being able to bring all the
Cloud computing represents many opportunities for media
                                                                   various technologies, components, services, and business
companies to improve their competitive advantage by getting
                                                                   partners together in these media value chains to create business
content to multichannel, three-screen (or even four-screen)
                                                                   value and deliver real-world solutions.
markets faster than ever before while potentially reducing
costs. This paper begins by looking at how cloud deployments       Current and future cloud deployment: What have
have been done in the past. It reviews the promises and risks      others done?
associated with cloud computing, what media and IT industries      Over the past two years, several surveys have been performed
are doing to address these opportunities and risks, and provides   in an attempt to better understand how companies are using
the IBM point of view. It concludes with IBM’s                     cloud computing today, and how they plan to use cloud
recommendations and identifies resources that will enable          computing in the future. In 2008, a professional IT journal
media companies to enhance their digital supply chain by using     study revealed that storage, archiving, and disaster recovery
cloud and SOA technologies.                                        were the most likely uses and planned uses for cloud
                                                                   computing. In 2009, an industry analyst published the results
                                                                   of a study that identified security and performance as the issues
                                                                   that most concerned executives about cloud computing.
                                                                   Another study in 2009 showed that less than half of decision-
                                                                   makers were either using or considering using cloud
                                                                   computing, and, of those who were planning to use cloud, most
                                                                   were considering private clouds.
Cloud Computing for the Media and Entertainment Industry
6   Cloud Computing for the Media and Entertainment Industry

More recently, a cloud adoption survey was performed that              Cloud gains momentum in media
included nearly 600 respondents responsible for managing               From the surveys cited, it can be observed that despite the
their organization’s IT budget and operations throughout               challenges, cloud computing, mainly due to its economic
Canada and the United States in 2009. This survey revealed             attractiveness, continues to grow. There are good reasons to
some interesting findings:                                             switch to cloud: low costs, low barriers to entry, increased
                                                                       mobility and scalability. There has been an emergence of
•   Security remains the leading reason for not adopting cloud         content clouds recently. As technical and cost barriers fall and
    computing. Forty-six percent of respondents who indicated          security issues are addressed, the cloud has become a viable
    they were not going to adopt cloud computing indicated that        platform not only for back-end operations, but also for key
    lack of sufficient security was the reason.                        business practices, including content management and
•   Despite the fact that security and integration issues are users’   distribution. During the 2008 presidential election in the
    biggest fears, this has not dissuaded them from implementing       United States, the New York Times online was able to handle
    cloud-based applications.                                          record traffic using cloud technology. The on-demand nature
•   The survey shows strong satisfaction with cloud computing          of massively scalable clouds has enabled media companies to
    once it has been installed.                                        provide more video on demand (VOD) without having to make
•   Seventy percent of the decision-making respondents plan to         investments in content delivery networks. By harvesting,
    move additional applications into the cloud; most indicated        hosting and combining their content with other content in the
    they would be doing so within the next year.                       cloud, publishers and media companies can answer a higher
•   Sixty-two percent of the respondents considered using cloud        level of questions for the customer. Consumer demand
    computing.                                                         rules—getting content to the consumer fast is the key to
•   When those who indicated they were not going to adopt              cloud success.
    cloud computing were asked what changes or improvements
    would change their minds, 33 percent said maturity of              This concept of “mix and match” around content is not new;
    solutions and 32 percent said better integration.                  however, cloud-based distribution of content promises to
•   Thirty-two percent indicated that existing infrastructure          enable consumers to use vast amounts of digital content in
    investments were a reason for not adopting cloud computing.        ways that currently do not exist. John du Pre Gauntt, the
•   Twenty-six percent indicated that integration worries              founder of Media Dojo, describes a digital supply chain
    prevented them from moving to cloud.                               manufacturing cloud that will enable customers to pick and
•   Cost is still the primary motivation for moving to cloud,          choose among media titles and how they want to experience
    however, agility is gaining momentum.                              them based on their product or service purchases. The news
                                                                       source BBC, in its information and archive strategy, describes
At a recent major software industry event, panelists estimated         moving to an asset-focused approach with enhanced metadata
that approximately 20 percent of enterprise computing takes            that will make content searchable and accessible. This
place inside the cloud, while 80 percent, generally the more           demonstrates the digital archive cloud as another channel.
mission-critical applications, take place inside the firewall. In
other words, most enterprises are still running their
applications on their own servers in their own data centers.
Cloud Computing for the Media and Entertainment Industry
IBM Sales and Distribution   7

Gauntt takes this further in his discussion of media scenarios,
                                                                  Table 1. Major cloud outages 2008 - 2009
describing “smart media” that has been strategically tagged and
will seek out interested consumers regardless of the channel or   Service Outage     Date         Duration            Source
consumer device. Until rights management is better controlled
                                                                  Amazon S3          02/15/08     4 hours             cnet
in software as a service, more media companies like The New
York Times will convert their internal application                Amazon EC2         04/07/08     1 hour              techcrunch

programming interfaces (APIs) to externally facing APIs on        Amazon S3          07/20/08     8.5 hours           amazon
clouds so that customers can license feeds or download content    Amazon EC2         06/11/09     7 hours             cnet
and mix it with their own content. For some media companies,
                                                                  Amazon EC2 12/09/09 1-5 hours                       datacenter-
there is a greater willingness to package and price content on    			                                                 knowledge
an a la carte basis.
                                                                  Google App         6/17/08      7 hours             softpedia
Recently, in a move to increase the ability to earn more
                                                                  Google Gmail       07/16/08     2.5 hours           pcworld
revenue from digital distribution, a consortia of 48 media
companies, called the Digital Entertainment Content               Google Apps and 08/06/08        about               pcworld
                                                                  Gmail		                         15 hours
Ecosystem (DECE), agreed to standardize on a common
format and enable proliferation of their content using Neustar    Google Gmail       08/11/08     1.5 hours           gmailblog

as the cloud-locker along with five digital rights management     Google Gmail 08/15/08           more than           pcworld
formats: digital rights management (DRM) formats (Adobe®          		                              24 hours

Flash Access, CMLA-OMA V2, the Marlin DRM open                    Google Gmail       10/16/08     30 hours            pcworld
standard, Microsoft® PlayReady and Widevine). Through             Google Gmail       02/24/09     2.5 hours           googleblog
cloud computing, entertainment that consumers buy would be
                                                                  Google Gmail       03/09/09     up to 22 hours      cnet
stored in a digital locker, Neustar, and remotely accessed from
                                                                  Google network 05/14/09 2 hours                     arborne-
any device that meets DECE’s format requirements.

The dark side of clouds                                           Google App         07/02/09     6 hours             techcrunch
In order to increase the adoption of cloud computing by media
companies, it will be necessary to build trust and confidence.    Google Gmail       09/01/09     2 hours             gmailblog
Public clouds have made the news frequently over the past two     Google Gmail       09/24/09     2.5 hours           cnet
years with major outages (Table 1).                               Microsoft Hotmail 03/12/09 5 hours                  network-
Security and performance issues cannot be controlled by the       Microsoft Azure 03/13/09 22 hours                   network-
media company in the public cloud; these issues represent         			                                                 world
dependencies. Not only have there been instances of stolen        Microsoft 10/04/09              6 days +            cnet
content, but there have many cases of stolen online identity.     Sidekick		                      total loss of
These issues can be summarized as loss of control by the          		                              contact data
content provider.                                            02/11/08     6 hours             zdnet

                                                             01/06/09     1 hour              The Register
Cloud Computing for the Media and Entertainment Industry
8   Cloud Computing for the Media and Entertainment Industry

Other important issues that worry public cloud users include           •   Investigative reporting: It may be impossible for some cloud
vendor lock-in, or the inability to get information out of the             providers to support investigations of inappropriate or illegal
content, or to transfer it to another cloud provider if the cloud          activities since logs, data and content may be dispersed over
user deems the service to be unsatisfactory. Cloud computing               ever-changing hosts and data centers.
continues to mature and address these issues; however, it is           •   Long-term viability: What are the provisions if the cloud
doubtful that many media companies are rushing to put the                  provider goes out of business or gets acquired by another
crown jewels into public clouds. The best analogy is putting               company?
money in a bank; it takes time to realize this level of trust and
confidence.                                                            IBM takes a leadership role to address
                                                                       cloud industry issues and challenges
Another more obscure issue is data dispersion, or the fact that
the cloud user does not know where the data physically resides.        IBM and the Open Cloud Manifesto
Countries where content may reside could have very different           In 2009, the Open Cloud Consortium, originally a consortium
laws regarding access and privacy. IT research and advisory            of universities, was formed to address the creation of open
group Gartner, Inc. has identified seven risks:                        standards to provide for inter-cloud interoperability—basically,
                                                                       a pledge to develop standards that would make it possible to
•   Privileged user access: Cloud customers do not know the            easily move applications from cloud to cloud. Shortly
    background, credentials or police records of those who             thereafter, it was recognized that the corporate computing
    administer public clouds. Enterprises generally have physical,     industry would need to develop a coordinated approach, which
    logical and personnel controls.                                    came in the form of the Open Cloud Manifesto, and was
•   Regulatory compliance: Many businesses must be SAS                 largely driven by IBM. The resulting document was brief (only
    70-compliant1. Regardless of whether or not one uses a cloud       seven pages) but it laid out the basic principles for companies
    provider, ultimately it is the customer who is responsible for     and cloud suppliers to work together and make it possible to
    the security and integrity of the data or content, even if it is   interoperate between clouds and to provide the flexibility to
    being managed by a cloud provider.                                 switch between suppliers. IBM and 29 other groups agreed to
•   Data location: This is another way of describing the data          the Open Cloud Manifesto.
    dispersion problem of not knowing where data and content is
    physically located.                                                One of the more recent outcomes from the original Open
•   Data segregation: Cloud users assume that their content is         Cloud Manifesto is the work of the Cloud Computing Use
    segregated from other users. While encryption helps, users do      Case Discussion Group, which continues its efforts today, and
    not always know or understand what schemes are in effect (or       in which IBM continues to be a major contributor. IBM
    how effective they are).                                           continues to foster an open discussion about cloud computing,
•   Recovery: Cloud users may not know what will happen to their       and created, as a launch site for our
    content in the event of a disaster.                                original work with Google. This group produced an important
                                                                       white paper, Cloud Computing Use Cases White Paper,
                                                                       identifying key cloud business scenarios. This white paper is
                                                                       now in its fourth version focused on service level agreements
                                                                       (SLAs) and use cases for security compliance. This document
Cloud Computing for the Media and Entertainment Industry
IBM Sales and Distribution   9

provides easy-to-understand descriptions of cloud service             Cloud value drivers
consumer and cloud service provider, as well as descriptions of       There are a number of ways that clouds can drive business
the most typical use case scenarios (not intended to be an            value. Cloud provides much more than merely a cost-focused
exhaustive list):                                                     return on investment (ROI) model:

•   End user-to-cloud: Consumer gains access to content through
    subscriptions, pay-per-use and/or sponsored advertising
•   Enterprise-to–cloud-to-end user: Media company stores archive
    content offsite in private cloud and cloud pushes derivative
    content to subscribing consumer
•   Enterprise-to-cloud: Media company collocates content
    distribution services and consumer behavior analytics in the
    cloud, and integrates with the cloud to monitor sales and time
    to market
•   Enterprise-to-cloud-to-enterprise (digital supply chain): Media
    companies collaborate on content; for example, studio dailies,
    multi-lingual/global production and distribution
•   Private cloud: An in-sourced, enterprise-hosted, on-premises
    private cloud, or outsourced private cloud managed by an          Figure 1. Cloud value drivers help define how business value is created.
    external entity
•   Changing cloud vendors: Business continuity
•   Hybrid cloud (single cloud has characteristics of private cloud
    and public cloud): Cloud stores copies of digital masters         Cloud value drivers have the potential to transform business
    (private cloud); manufactures digital derivatives for B2B and     strategy in many ways:
    B2C distribution, and may provide storefront capabilities
    (public cloud)                                                    •   Driving business innovation
                                                                      •   Increasing business agility
                                                                      •   Lowering total cost of ownership
                                                                      •   Improving asset utilization and products-services time to
                                                                      •   Optimizing technology investments
                                                                      •   Enabling real-time content and metadata sharing
                                                                      •   Providing globally available resources
                                                                      •   SOA and cloud: The dream team
Cloud Computing for the Media and Entertainment Industry
10   Cloud Computing for the Media and Entertainment Industry

The media and entertainment industry has been met with              Service oriented architecture (SOA) has been increasingly
dramatic changes over the last five years that have moved it        promoted as a means of addressing the media business’ needs
from nearly all physical products to predominantly digital          in a cost-effective and responsive manner. In 2008, Gartner
products. Everything associated with the creation of content        reported that most European and North American companies
has turned from physical goods to digital. While this transition    were planning to adopt SOA over the next 12 months. SOA
has opened up new opportunities in delivering new products          promises to provide services as the basis of abstraction so that
and services to consumers (such as new audio and video              services are loosely coupled, autonomous, stateless and include
delivery services that have evolved to products like iPads), new    their own explicit quality of service characteristics (security,
challenges have been introduced in understanding where              performance, etc.).
content is inside the client’s environment, what state it is in,
who needs to get it, and when it needs to be delivered.             An SOA is the perfect architecture for cloud because services
                                                                    run on any system that exposes them, inside or outside the
Systems and processes have evolved over time to support the         enterprise. An SOA allows you to manage, orchestrate and use
physical creation and distribution of these products and            services and create “situational” applications that are
services. As the content and its delivery environment have          “composites” of services, which enable business agility. This is
changed, many of these systems have as well, but for the most       made possible because an SOA provides the following three
part the systems and technologies do not all work well              fundamental properties:
together. Closed, proprietary and siloed infrastructures must
now give way, or at least harmonize with open, standardized         •   Open standards
and more horizontal processes and applications.                            –– SOA provides a standard method of invoking web
                                                                              services allowing disparate organizations access to these
Media companies, dealing with a more competitive                              services across network boundaries.
environment during difficult economic times, are searching for             –– Web services use open standards to allow inter-
ways to minimize their technology costs while, at the same                    enterprise connectivity across networks and the Internet.
time, offering more sophisticated products and services. Media             –– Messaging protocols (SOAP) and transport protocols
companies’ resources have been organized according to the                     (including HTTP, HTTPS, JMS)
specific business functions they support which, as we have                 –– Security can be handled at both the transport level
stated, have resulted in the formation of separate application                (HTTPS) and/or at a protocol level (WS-Security).
silos. In response, these separate application silos result in             –– Web Service Definition Language (WSDL) allows
duplication of application functionality, high integration costs,             web services to be self-describing for a loosely
underutilization of resources, and limited ability to share                   coupled architecture.
content and information. Media companies’ underlying                •   Integration
technology has become much more complex and less flexible,                 –– Interfaces are provided to wrap service endpoints to
making it increasingly difficult to respond and keep pace with                provide a system-independent and application-
the revolutionary changes in the industry.                                    independent architecture.
                                                                           –– SOAs can provide dynamic service discovery and
                                                                              binding, which means that service integration can
                                                                              occur on demand.
IBM Sales and Distribution   11

•   Virtualization                                                the workflows necessary to provide multiple channel content
       –– A key principle of SOA is that services should be       distribution are too much for many media companies. On
          invoked by service requesters that are oblivious to     the other hand, doing nothing could mean disintermediation
          service implementation details, including location,     or, worse, obscurity.
          platform and if appropriate to the business scenario,
          even the identity of the service provider.              How media companies can benefit from SaaS
                                                                  SaaS minimizes the upfront costs associated with hardware and
All of the properties above are prerequisites to support          software acquisition and helps companies avoid having to hire
services delivered from the cloud. Additionally, if an SOA        more staff to operate and maintain in-house systems. There are
framework is to provide the ability to situationally create a     four basic SaaS models (and combinations that can benefit
composite service, it must be able to provide the messaging       media companies):
properties that are required to connect the various services
that comprise the composite service. Messaging properties,        1. A multi-tenant architecture owned and maintained by a cloud
such as persistence, transformation, routing and mediation, are      service provider (ASP-style)
necessary precursors to be able to support the choreography       2. Hosted internally and maintained remotely
of the composite service. Extending these messaging properties    3. Internally developed and hosted on cloud provider
to media objects enables content agility and is the key to           infrastructure
providing an SOA that allows a seamless integration of the        4. Self-hosted software providing software services to partners or
transactional messaging and content essence that exist in all        subscribers
services that emit or consume digital media.

A cloud based on SOA allows an enterprise’s intra-
organizational business processes to be extended into the
                                                                  In the future, most internal-facing, media
cloud and take advantage of the benefits of cloud computing,      company enterprise applications will be delivered
particularly on-demand services and highly scalable IT            in the form of reliable and secure services using
services. Cloud computing and SOA combine to form the
“dream team.” Since a cloud is basically an instance of an
                                                                  private networks and the Internet.
architecture, using SOA ensures that cloud computing
provides be the most agile and cost-effective cloud platform.
                                                                  In addition, there are various combinations of the basic models.
Cloud computing provides media companies with software-
as-a-service (SaaS), infrastructure services (infrastructure-     In the future, most internal-facing, media company enterprise
as-a-service, or IaaS), and platform services (platform-as-a-     applications will be delivered in the form of reliable and secure
service, or PaaS). Considerable pressures exist to meet           services using private networks and the Internet.
consumer demand. However, the development and infra-
structure costs associated with building the technology and
12   Cloud Computing for the Media and Entertainment Industry

How media companies can benefit from IaaS                        IBM has been building large data centers for years, offering
IBM offers IaaS by using core competencies in various            these benefits:
infrastructure technologies, including cluster computing,
autonomic computing, grid computing, utility computing and       •   Reliability: An IBM data center typically provides 99.99
virtualization. IaaS benefits media companies by providing           percent up time.
elastic or scalable infrastructure on demand to handle           •   Smarter data center management: Thousands of sensors,
traffic and content overflow situations. IaaS uses statistical       connecting IT equipment, data center and building
multiplexing to increase and shrink resource utilization.            automation systems, provide data that can be analyzed for
Some estimates are that statistical multiplexing reduces             future capacity planning, conserve energy and maintain
resource utilization costs by a factor of five to seven.             operations in the event of a power outage.
                                                                 •   Energy efficiency: An IBM data center uses half the energy cost
A mission-critical, enterprise-scale cloud provider must             to operate compared to data centers of similar size by taking
possess large-scale reliable and secure fundamental                  advantage of free cooling—using the outside air to cool the
infrastructure resources: data centers, managed services,            data center. Intelligent systems use sensors to continuously
massively scalable storage, massively scalable processing            read temperature and relative humidity throughout the data
and secure network connections.                                      center and dynamically adjust cooling in response to changes
                                                                     in demand.
                                                                 •   Cloud computing capability: Support for cloud computing
                                                                     workloads allows clients to use only the resources necessary
                                                                     to support IT operations at any given moment—eliminating
                                                                     the need for up to 70 percent of the hardware resource that
                                                                     might have been previously needed to perform the same task.
                                                                     The data center also hosts recently announced “Smart
                                                                     Business” cloud computing offerings—each of these solutions
                                                                     can significantly reduce a client’s total cost of ownership
                                                                     (TCO) by up to 40 percent.
                                                                 •   Built for expansion: Due to an innovative modular design
                                                                     method, IBM will be able to add significant future capacity in
Figure 2. IBM North Carolina Leadership Data Center
                                                                     nearly half the time it would take traditional data centers to
                                                                     expand. This design/build method, called IBM Enterprise
                                                                     Modular Data Center (IBM EMDC), also enables IBM to
                                                                     rapidly scale capacity to meet demand by adding future space,
                                                                     power and cooling to the data center with no disruption to
                                                                     existing operations. This means up to 40 percent of capital
                                                                     costs and up to 50 percent of operational costs may be
                                                                     deferred until client demand necessitates expansion. An IBM
                                                                     data center can also quickly and seamlessly expand its power
                                                                     and cooling capacity.
IBM Sales and Distribution   13

How media companies can benefit from PaaS                           IBM recommendations for successful cloud
Finally, as a layer built on top of IaaS, PaaS offers media
                                                                    Digital supply chain
companies consistent services such as authentication,
                                                                    IBM has been looking at how the new business reality impacts
authorization, data persistence and task scheduling. PaaS
                                                                    supply chain. By using digital supply chain, media companies
has been a topic of interest with telcos since they already
                                                                    can use their core competencies and call upon clouds to
provide content, storage, and connectivity services to
                                                                    enhance their supply chain. Clouds are places to store, process,
consumers and businesses. Telcos are providing their existing
                                                                    distribute and support exposure of content in an elastic fashion.
IaaS as a platform for B2B and B2B2C digital supply chains.
                                                                    To increase supply chain efficiency and deliver the products
IBM is building digital media exchange clouds supporting
                                                                    and services consumers want, media companies are looking to a
comprehensive content aggregation, management, derivative
                                                                    combined SOA and cloud computing solution.
manufacturing, and multichannel distribution built on top
of clients’ outsourced and managed services.
                                                                    Using SOA and cloud computing in the new digital supply
                                                                    chain enables media companies to keep pace with the rate of
                                                                    innovation. SOA and cloud computing support:
IBM is building digital media exchange                              •   Faster time to market
clouds supporting comprehensive content                             •   Increased sales by increasing the exposure of content
aggregation, management, derivative                                 •   Richer flow of information to adapt quickly to changing
                                                                        consumer interests and demands
manufacturing, and multichannel distri-
                                                                    •   Decreased labor, inventory and working capital costs
bution built on top of clients’ outsourced                          •   Faster fresh content that is packaged, identified and available
and managed services.                                                   to the consumer
                                                                    •   Available “forever” deep catalog content

                                                                    IBM’s commitment to digital supply chain
The IBM SOA software group framework                                management
To support the digital supply chain, IBM Software Group             IBM structures a digital supply chain that is customer-centric,
has developed the IBM Media Enterprise Framework built              responds to new consumer behavior, and is smarter or opti-
on SOA architecture using IBM software. Cloud computing             mized using business intelligence and analytics. The IBM
provides a way to virtualize the service executions, security       Media Enterprise Framework shows IBM’s strong commit-
and infrastructure. Media Enterprise framework can work             ment to its clients by taking a “we’re in it together” approach.
with the cloud in realizing the capabilities, such as business      Cloud offerings often fail because clients do not perceive that
analytics and optimization, media, metadata and information         the cloud provider understands or cares about the client’s
management, multi-channel enablement, business process              business. IBM’s commitment includes becoming an integral
transformation, security and infrastructure management.             part of the design and delivery team.
The Media Enterprise Framework can be used as a delivery
platform to help manage the services in each of the capabilities.
14    Cloud Computing for the Media and Entertainment Industry

Leading the evolution of media clouds:                                  as simple as an in-house, in-sourced, on-premises managed
What should I do?                                                       service model to a full hybrid cloud that is fully integrated with
Media companies must understand where they are in                       the media company’s enterprise systems. There are several
developing their digital supply chain and how they can best             reasons to begin with the archive:
utilize SOA and cloud computing to augment and improve it.
The application of technology to enrich the digital supply              •   The archive is not in the production-critical path; therefore,
chain and to improve competitive advantage will depend upon                 there is less risk to current mission-critical processes. At the
a wide range of factors. However, a generic strategy for a media            same time, there are likely to be hidden treasures in the
company might include combinations of these elements, all of                archive, or, what retailers used to call “deep catalog.”
which are related to digital supply chain, and all of which IBM         •   Most media companies store copies of their assets. Some
has a history of successfully delivering to media clients:                  media companies are applying approved asset preservation
                                                                            and disaster recovery budgets to justify private cloud archive
•    Build digital archives (convert analog assets to digital assets)       initiatives.
     and store digitized assets on-site and off-site, applying best     •   Most media companies have a mix of analog and digital
     practices in storage and asset management.                             content in their on-premises archives. Some of the digital
•    Develop an enterprise-wide strategy for standards-based                content may be stored off-site as part of the disaster recovery
     metadata creation, discovery, use and exchange.                        and business continuity policies.
•    Protect assets using encrypted communications                      •   Media companies can develop their metadata strategy
     (authentication, authorization) and the encryption of content.         (metadata creation, discovery, use, and exchange) in a
•    Provide separate portals for B2B and B2C to support                    deliberate and controlled pace rather than being driven by the
     branding and consumer experience.                                      demands of live events and live content.
•    Provide e-commerce and storefront capabilities with an ad
     insertion capability.                                              IBM GA cloud offering use cases and
•    Support subscription and pay-per-view models.                      media and entertainment specific use cases
•    Maintain control over the cloud’s content delivery resources       It is important to separate media and entertainment use cases
     by preventing rogue applications from over-consuming               into two groups: (1) generic use cases, or, those use cases that
     resources.                                                         can be used regardless of the industry environment, and (2)
•    Integrate enterprise legacy and backend systems with external      media and entertainment-specific use cases that address
     cloud services.                                                    specific needs in the media and entertainment industry.
                                                                        Generic use cases may provide value to those media companies
The journey begins at the same spot for every media                     considering how best to “wade into” cloud computing, or those
company—digitizing content, to create the new digital supply            looking to implement a cloud to demonstrate cost savings and
chain. IBM recommends that media companies begin with                   provide the organization with valuable hands-on experience
their digital archive as a means of building a pilot to explore         and understanding of cloud challenges and benefits. For
the use of a private or public cloud. Deployment models can be          example, IT organizations of media companies can
                                                                        immediately implement the generic use cases to demonstrate
                                                                        and test the value of cloud computing in supporting workloads
                                                                        optimized for IT, such as testing of applications and software.
IBM Sales and Distribution   15

       Figure 3. Media and entertainment sub-industries and cloud
       use cases

See the first column in Figure 3, which identifies several              clients access to IBM compute clusters (IBM System x®, IBM
generally available IBM cloud offerings:                                BladeCenter®, IBM System p®, and IBM System Storage®)
                                                                        on an hourly, weekly or yearly rental basis.
•   IBM Smart Business Desktop on the IBM cloud subscrip-           •   IBM Smart Business Development and Test on the IBM
    tion service helps clients virtualize desktop computing             cloud is designed to help enterprises reduce operational costs
    resources, and provides a logical, rather than a physical,          and large amounts of capital outlays, improve cycle times
    method of accessing data, computing power, storage capacity         for faster time to market and improve quality with virtually
    and other resources.                                                instant, security-rich access to a standardized test and
•   IBM Compute on Demand infrastructure offering, provides             development environment.
                                                                    •   The IBM Smart Analytics Cloud is a solution offering to
16    Cloud Computing for the Media and Entertainment Industry

     enable delivery of business intelligence. This offering uses           desktops, designed to help you quickly back up, restore,
     IBM hardware, software and services to offer a complete                archive and maintain access to critical data on demand.
     solution enabled at the customer site.                             •   IBM LotusLive™ iNotes® is a secure cloud-based messaging
•    IBM Smart Business Storage Cloud offers a storage-                     service that provides essential email and calendaring
     virtualization solution designed to support a company’s                capabilities. IBM LotusLive iNotes can be integrated
     storage optimization efforts. It can help alleviate data storage       alongside existing enterprise messaging solutions or operated
     challenges by enabling quick implementation of a scalable,             standalone to reduce overall cost of ownership.
     global file storage system with flexibility in deployment and
     management options.                                                Media and entertainment-specific use cases
•    IBM Smart Business End User Support self enablement                Media and entertainment sub-industries and cloud use cases
     portal is an Internet-based solution that enables end users        also provides basic cloud use cases for television and radio
     to resolve their support issues due to a leading-edge know-        broadcasters, movie studios, the games sub-industry, and
     ledge database that delivers a comprehensive, personalized,        publishing. Those use cases that can be met by current IBM
     multichannel experience in multiple languages through a            offerings have been color-coded in dark-blue, those use cases
     single easy-to-use interface.                                      for which IBM offerings are imminent have been color-coded
•    IBM Information Protection Services is a range of managed          in light-blue, and those use cases that IBM will include in
     services. It includes both on-site and remote data protection      future offerings have been color-coded in white.
     capabilities for your data center servers, applications and
     databases, as well as protection for email, laptops and

                            Figure 4. Common cloud management
IBM Sales and Distribution   17

IBM’s goal is that our cloud offerings will be based on a          •   Business intelligence and analytics—a gaming cloud may
common cloud platform that provides a foundation for                   generate billions of transactions in a day. There is simply no
value-added services, including but not limited to:                    way to make sense of trends, purchasing patterns, and do
                                                                       forecasting without business intelligence and analytics. IBM
•   A public cloud with multiple service “on-ramps” for clients,       has world-class capabilities in designing and implementing
    hosted in key centers worldwide                                    BI-based digital supply chains.
•   A common infrastructure to provide computing and               •   B2B monetization—integration of content distribution
    storage resources                                                  processes with back-office and business intelligence processes.
•   A common platform, business support services (BSS) and
    operational support services (OSS) to operate and manage       Note that all of these use cases will depend heavily on the
    the cloud implementation                                       development of an enterprise and, to the extent possible, a
•   A full range of IBM and partner services                       standards-based, extra-enterprise metadata strategy. Without a
•   The implementation and hosting services to build “private      sound metadata strategy implemented as early in the digital
    clouds” for strategic outsourcing (SO) data centers and        supply chain as possible, the less visible and useable digital
    other clients                                                  content may become.

IBM believes the following digital supply chain use cases          IBM also envisions the following future use cases in media and
hold the greatest value for cloud computing in media and           entertainment:
entertainment in the immediate future:
                                                                   •   Fully integrated B2B/B2C business models: Integration
•   Digital archive—off-site content disaster recovery with            with commerce, supply chain management (SCM),
    potential to evolve into B2B and B2C business models and           enterprise resource management (ERP) and customer
    new revenue streams. IBM has a proven record of providing          relationship management (CRM) systems. IBM has a global
    digital archive as an outsourced and managed service.              team of integration specialists who integrate enterprise,
•   Production support—an extension of archive to support              legacy, and cloud-based systems using best practices in
    on-going production processes. IBM designs WAN and                 SOA-based integration.
    LAN infrastructures and works with partners to provide         •   Digital cinema end-to-end workflow support using cloud:
    cloud-based production support.                                    Centralized ad insertion, securing the production through
•   Broadcast facility resiliency—content archived to provide          post-production workflow with Key Delivery Message
    real-time broadcast failover in the event of a broadcast           (KDM) management for dailies and distribution to theatres.
    facility outage.                                               •   Real-time streaming analytics (based on IBM System S):
•   High-intensity processing—clouds equipped with special             Cloud-based capability of analyzing many inbound real-time
    high-intensity processing (grid computing) required to             sources of audio, video, text and metadata to support real-
    expedite rendering, watermarking, transcoding and                  time business model adaptation and collaborative planning
    encryption processing.                                             forecasting and replenishment (CPFR) processes in digital
•   Derivatives manufacturing—transcoding, encrypting, etc.,           supply chain.
    and final packaging content for push or pull distribution.     •   Intelligent dissemination of content using push models and
                                                                       smart content: Clouds maintain atomic content (pre-wrapped
                                                                       with rights pointers) and associated metadata, as well as the
                                                                       analytics to target consumers.
18   Cloud Computing for the Media and Entertainment Industry

Table 2. Media and entertainment-specific use cases and deployment models

Use Cases                                    Sub-Industry         Sub Use Cases                        Deployment Model(s)

Digital Archive                              All                  On-site Digital Archive              Private

		                                                                Off-Site Content Disaster Recovery   Private

Overflow                                     All                  Storage                              Public, Private, Hybrid

		                                                                Processing                           Private, Hybrid

B2B Monetization                             All                  Derivatives Manufacturing            Private

		                                                                B2B Distribution                     Private

		                                                                Order Fulfillment                    Private

High Intensity Processing                    TV, Studios, Games   Rendering                            Private, Hybrid

                                             TV, Studios, Games   Transcoding/MXFwrap/ MXFunwrap       Private, Hybrid

                                             TV, Studios, Games   Watermarking                         Private

                                             TV, Studios, Games   Encryption                           Private

                                             Publishers           Text Analytics                       Private, Hybrid

Broadcast Facility Resiliency                TV                   Real-time Analytics (System S)       Private, Hybrid

BI/Analytics                                 All                  SCM, CRM, ERP integrations           Private, Hybrid

Streaming Analytics                          TV		                                                      Private

Live Events                                  Studios, Games		                                          Private, hybrid

Digital Cinema                               Studios              KDM Management                       Private

                                             Studios              Digital Dailies                      Private

Text Analysis                                Publishers		                                              Private, Hybrid

Semantic Search                              Publishers		                                              Private, Hybrid

B2C Distribution                             All		                                                     Private, Hybrid

Smart Content                                All		                                                     Private, Hybrid
IBM Sales and Distribution   19

                           Figure 5. Sub-use case off-site preservation of content

Media and entertainment-specific use cases and                             •   Private clouds are better than public clouds when tight
their deployment models                                                        controls are required.
Each use case has a likely deployment model or set of                      •   Public clouds are best when distributing massive amounts of
deployment models based on the level of content protection,                    content to consumers over the Internet is required.
security requirements and degree of processing required within             •   Hybrid clouds are best when content aggregation,
the deployment model (Table 2).                                                management and distribution workflows need to be
                                                                               contiguous to support the digital supply chain.
20   Cloud Computing for the Media and Entertainment Industry

Digital archive can be deployed equally well as an on-site,                         Digital media archive sub-use cases
on-premises private cloud or as an off-site private cloud.                          IBM recommends that media companies start with their
Storage overflow has been implemented with great success                            archives. Figures 5, 6, and 7 show an elaboration on this
using the public cloud model. Depending upon how custom or                          use case in the form of three sub-use cases: (1) off-site
sophisticated the processing requirements are, high-intensity                       preservation, (2) off-site production support and (3) B2B
or high-performance processing can be performed in a private                        monetization of content.
or a public cloud. Generally, those content processes related to
content protection and usage tracking, such as encryption and
watermarking, respectively, are best performed in a private
cloud where strong governance and oversight are important.

                                     Figure 6. Sub-use case off-site production support
IBM Sales and Distribution   21

Figure 7. Sub-use case B2B Content Monetization
22   Cloud Computing for the Media and Entertainment Industry

Global evolution of media clouds                                  once, however, from what we
In a recent survey conducted by IBM and NHK, the national         have observed in major media companies around the world,
broadcaster of Japan, it was revealed that each of the 12 media   the highest priorities are digitizing content and protecting it.
companies are managing their assets and long-term archive
along a roadmap or continuum that is moving from enterprise       Note that each deployment model has its own business models,
to private cloud to hybrid cloud (Figure 8). There is nothing     benefits, assets, technical and business activities, and its own
that precludes using all three cloud deployment models at         set of key decisions.

         Figure 8. Evolution of media clouds
IBM Sales and Distribution   23

Enterprise deployment model                                          •   Technical activities:
•   Business models:                                                        –– Digitize: New revenue models, particularly mone-
       –– On-site preservation of assets                                       tization, are based on having digital content. Even
       –– On-site production support: Pre-production research,                 licensing models benefit from digital content since the
          search-browse-preview of archived content, and                       digital master can be used to produce many identical
          repurposing of preserved content.                                    copies for re-broadcast.
•   Benefits:                                                               –– Encrypt: Within the enterprise, encryption may or may
       –– Strong control of content and systems manipulating                   not be used; in some cases content is encrypted since it
          content                                                              will be sent to external B2B consumers. (An example is
       –– Continuity of knowledge (institutional knowledge)                    the AES 128-bit KDM encryption included in the digital
•   Assets:                                                                    cinema initiative specification.)
       –– Content is likely to be both analog and digital in the            –– Log/Catalog: Content cannot be located if there is no
          enterprise deployment model.                                         metadata associated with it. Cataloging is the more
       –– New content today is likely to arrive in digital formats             formal, information science activity associated with
          and be relatively easy to ingest.                                    preserving and archiving content.
       –– Legacy, videotape-based content, may or may not be in      •   Critical decisions:
          the process of being digitized.                                   –– What seasonal and cyclical peaks and variability
       –– Many digital asset management (DAM) vendors provide                  should be taken into consideration? What are the
          archive-as-you-go capabilities, saving content to the                temporary bandwidth and storage requirements that
          archive once the content has been ingested, once                     must be addressed that the current infrastructure
          finished shows have been approved to air, and while                  may not be able to handle?
          content is actually being aired; in addition, these DAM           –– What content are candidates for cloud storage?
          systems provide low resolution proxy generation and               –– What performance service level agreements (SLAs)
          logging and cataloging capabilities to generate and                  are required?
          enhance metadata.                                                 –– What security SLAs are required?
•   Business activities:                                                    –– What content protection and/or encryption
       –– Creation of a baseline or balanced scorecard: Represents             are required?
          the value of the enterprise model, associated costs,              –– What is the expected ROI or cost-benefit?
          including capital and operating expenses and benefits,
          particularly with respect to production support (pre-
          production research, repurposing, and so forth); degree
          of security and content protection, which will help
          provide the justification for making the transition to a
          cloud deployment model.
       –– The baseline information consists of workflow analysis,
          content audit and activity-based cost analysis: What do
          we have? How it is processed? And, how much does it
          cost to create content products and metadata?
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