 I love working with Ralph, he makes it sound so good. Is the microphone on here or are we there? Can you hear me? It would be terrible if you couldn't hear me. So as you can see, I collect websites. This presentation is going online at 7.30 p.m. I have it on the time release. You'll be able to download from mediafuturist.com. So I give you a short expression for us what I really do. A lot of people are saying, this is a futurist. I think David gets the same question. Basically what I do is I sort of infect people with ideas about where it can go for the next couple of years. And this is basically... I was lucky to find this at istockphoto.com and I thought, okay, this is a perfect fit describing what I'd actually do. I run a blog, of course, and here is my book, Music 2.0. That's a book I wrote last year. You can download for free at music2overthebook.com. And here's my old book, and here are some of my clients. So I work with technology companies, media companies, publishers, rights holders, copyright organizations with people that usually wouldn't talk to each other. But through me, I guess they are, and I do mostly think tanks and those kind of things. So here is Obama saying it's not a recession to which I would add it's not just a recession, but a transition. Now in content, we're looking at this kind of scenario. We're looking at a total reset of the content logic. The internet has disrupted everything from A to Z as far as what we pay, when we get, how we do it, how we spread it, how we listen to it, all of it. So there's no wonder that we have to reset starting with the music business, which has been resetting for what, 200 years? I'm 10 years, I mean. So we're going from this sort of paradigm of control, of domination, of power. We're going away to a different, what I call the age of collaboration. America should know about this, right? Going from war to a way of collaborating to actually make it better for everyone. This is a huge shift. So we're going from what I call an ecosystem to an ecosystem. An ecosystem means I make as much money as I can with what I do regardless of what happens to you. That's extreme capitalism. That's what we've had until now. Not to say it was bad. I tried myself, but failed. But in any case, now we're shifting. Now all of a sudden, Medvedev, the Russian president, says economic egoism is over. That has a lot to do with copyright, with patents, with how we act internationally, with the banking crash, of course, which comes partly out of this. So we're seeing this sort of move to a situation to where we really are all connected. The telecoms, the content businesses, advertising industry, the mobile manufacturers, Nokia getting into music, Sony Ericsson getting into music, RIM getting into music, right? So we're all connected in this scenario, and we're looking essentially at a situation that I call broadband culture. Some people would call it broadband unculture, like Andrew Keane, who's, I'm sure, busy twittering. Hello, Andrew. So basically, if we talk about broadband, I mean, we have this phenomenon to where all of a sudden we're connecting to each other. We're doing this now through a multitude of platforms, and we're doing it around the world. By the time I'm done speaking, I'll have another 1,000 twitter followers. So we're all connecting in a way, and this is getting to be kind of hard to do, of course. Of course, at the same time, we have a flood of content. All the digital movies we can watch, all of the downloads we can get, all of the RSS feeds, right? It's basically mayhem. So the flood of content is coming down very hard, and of course, then mobile makes it worse. Because now, guess what? You can watch YouTube on the subway, not just at home. You can also do it there. So all your time is taken up with media, mobility, and the sort of flood of content that we're seeing here. So when you think about this, and you look at the digital content trends, music is, of course, first to go digital. Right now, it's at about 20% of the revenues, of the dwindling revenues of music are digital. But that's going to go to 100%, of course, followed very closely by video, by games, by books, magazines, and print. And we're seeing, of course, the first scenarios play out with magazines and print right now. And this, of course, are my own estimates. They're not scientific, they're just futuristic. But here's a scientist. Barmer, Steve Barmer from Microsoft says there will be no consumption of media left that is not going through IP within 10 years. No more printed stuff here. That's what he says. I don't quite believe it's going to be that drastic, but that's what he says. So we're going to see a lot of this. We're going to be basically uprooted by these things. This is going to make us flail our legs and say, oh my God, what, you know, the load is heavy. Basically lifts it up. And a lot of people will scratch their heads and say, okay, how do we go from here? Now, this is from the industry standard. The new one, they say, print in the New York Times costs twice as much as giving every subscriber a free Kindle. Think about what that means. We could give everybody a box that would be cheaper than keeping on printing. I don't know if that's true. You'll be the expert on that eventually. But this is an amazing development. I mean, if we look at what's happening here, we have total mobility everywhere. We have constant peering and connecting, as I call it, with friends. Always being pinged by somebody for something and location-based services. Deep oceans of content. Our brain is in shock. Not in the glass quite yet, but, you know, all this stuff happening at the same time. We can hardly deal with it. We need filters. This is the big opportunity for content to be filters. Like the BBC, of course, has been all along. Filters, right? Basically, curating and figuring out what to do and all those lovely words that we're seeing here. Curation, collation, contextualizing. That is a huge opportunity that I see in this flood of content. So, if we're looking at the other direction, as David was saying earlier, the real action, of course, is in the BRIC countries. Brazil, Russia, India, China and, of course, Africa, they're going straight to digital content. Indian kids will watch the first movie ever, not on television because they don't have electricity a lot of times. They'll do it on the mobile phone. The first English word is Google. Straight to bundled access, straight to mobile, straight to new types of advertising. All that stuff will happen there, and, of course, especially in Africa, sooner or later. Google is setting up free networks around the world. 17 satellites, as far as I know, flying around the orbit, basically giving people free internet access and Nokia will give away free devices. Then we're going to see action. Then we're going to be worried about content, right? The exchanging of content is going to be a thousand times what we see today. So, that's a good view and a bad view. But here's a short story on this. The question that I have is, is content really ready for this future? Of course not. We know the answer. It's not have to be a futurist for that one. But here's an interesting example. Kutiman, how many know about Kutiman? Here's an Israeli guy on a beach cut together probably about 5,000 hours of video that created a new song only by sampling. And he used all kinds of sources that must have taken a lifetime or two. I don't know. Amazing project. This is what it sounds like. Well, what can I do? He could play that 16th note groove just straight. These are all separate images of video from separate places. Then he cut together into a song. Do it again. They're not actually playing together. They're cut. They're playing single notes, they're playing chords and they'll mix them together. Let's just pick the mother of all funk chords. Let's pick a 9th chord. Was supposed to stop earlier. Sorry about that. It's a cool track though. So, what he did is put all the stuff together and the headliner Kutiman was in the press so amazing, so illegal. Everything he did was essentially wrong. And if you have kids, you know what I'm talking about. Everything we do on the internet is essentially not legal. All the cool stuff. And I'm talking about sex now. I'm talking about all the stuff that's good like all the stuff that we used to do with music and sharing and cutting video to audience and so on. None of that is legal. And of course we can look at the story of Pandora that's no longer legal in this country. Last of them buying the liberty to be legal hopefully. All of mp3.com, the fab channel in London. It basically happens all over the world. All the cool stuff is not working. The industry has essentially said all the cool stuff we can't do. We don't know what to do with you guys. We don't have the authority. We don't want to create trouble in the ecosystem so to speak. Letting the virus of liberty roam free. So basically this has to move over into a corner to where we're saying we need to enable things rather than prohibit things. We're moving in a direction to where we're clearly seeing in the copy industry the value of a copy is completely declining. That's not used to anyone obviously because a copy is easy to make. Anybody can get a free one. Now what comes in the place of a copy is attention. And not to be too California and Kevin Kelly evangelistic. Attention revenues. That's not just advertising. Anything that's being generated by people's attention. That is where we're going because in the future I'm going to look at this little bit more detail. Here's an early example. The president of the United States of America, the band, has an iPhone app. Amazing place for this iPhone is $3 to get the app. You can listen to four albums for free and do the whole thing. I think I have details on this in the next slide. So you pay $3 for what you would otherwise do for free because you can do the free listening on the web. It's a great way of getting sort of net play, cell tickets, and a direct line of communication. So what they have done is they have repackaged their music into an app. They charge for it. We're excited. We're doing all this stuff. We're linking them. They're making money out of this format change. It's essentially a packaging issue. So if we're looking what's happening, clearly all of you know the content is essentially in the cloud. Pretty much any content we want. Images, videos, books, and all of the books will be moving into an afterization process in the next few years. Pretty soon you'll be able to read every single book you want on the iPhone for free. Not legally, but for free. So this is where content resides now in the cloud. And this is no surprise that's where we are. We upload pictures to Flickr. We do YouTube. And of course right now there's still sort of geek material. But very soon because of mobile devices anybody can do it. So basically what we see here is that the content is in the cloud, the users are in the cloud and the money is in the cloud. The new money is in the cloud. That's where we have to go to get the money. So the future of content as I like to say is in the cloud and the crowd. Those are the two places. They are not in the box. They're not in the CD. They're not in the copy. They're not at water music. They're not in particular places. They're in the cloud and the crowd. All we have to do is say yes. We want this to make this connection. To monetize this. And then I think we have the... I just give myself a little toast here. So what we're looking for is a collaborative revenue model. We need to get away from the domination model which says I have this right and therefore I can ask for whatever I want from you. Google or whatever it is. Because I want to get paid. Which is of course a positive approach. But having a domination play essentially means there's no way to collaborate. It's my way or the highway. Just ask BLAST FM or Spotify or I mean project playlist or any of those guys. Just ask any of the 780 or so stranded and bankrupt ventures in digital music what the issue was. No collaboration. So what we need to do as an industry beyond music of course media, telecom advertising the joint development of what I call the new generative. Where is the new money coming from? It's not going to come from one place. It's not going to come from the government. It's not going to come from Google. It's not going to come from the telecom. It's not going to come from many places. Places that we actually create together. So this sort of idea of saying we like to control it and therefore we work in the future and here's the real bomb for a lot of us. Now with the internet listening, reading or watching is keeping, copying and sharing. It's the same thing. Digital radio is a cheap iTunes basically. Because anybody can reorganize and redo this, right? Basically say what we're getting here right now as soon as we listen we make a copy. So why do we have a copyright but of course performance is free? Because it's the same thing now. The mechanical reproduction of music is whatever it is in the States, 9.1 cents for that. But the stream or the listening is free. But now the stream is the same in the download. As we all know, if you just watch the kids how they do these things. And then the mobile connects to the web in the same way. So we have this situation where the theory that listening is free and that listening costs money has been completely demolished. And that will be true just to watch the next generation happening there with videos and of course with books. So free. Free radio. Remember that free radio wasn't cool until the government said so. It was illegal. Radio did not have a license for a long time because it was free. Publishers, writers, musicians, pretty much anyone that was in the government said that's not good. It's free music. But they did get a license so now they have a huge boom in radio or they used to. Now we're thinking, okay, television, YouTube, also free. Or at least if you consider the payment of a license fee it's more or less free. But the next step will get interesting. The Internet. This is from Kevin Kelly's website, KK.org. It's free. It's enlarged but it's basically the same idea. It's free. So now you can say, let's hold on a minute. That can't be. There's no free lunch here. You get everything for free. Who's going to make any money? What's the larger behind this? So if we think down this little bit I think we need to license content on the Internet like we license radio starting with music. A license that gets everyone to be legal to what they're doing anyway. And that's not going to stop. As I told you earlier, if we look towards the rest of the world we're going to see a total explosion of sharing and doing this will make us look like aspiring to be N1. So I think online access needs to be the same than music access. Bundled. We have that already in place in China and Google. I'll talk about that later a little bit. And of course in Denmark with TTC and music access has to be payment included. Of course that's a big topic. I'm not talking about the tax here, right? Even though it could be a tax if you're so inclined. We have to create a new ecosystem then on top of that permission. This is a system that worked out great for radio. The radio license gives every broadcast to the right to broadcast anything they want 24, 7 hours a day. So it's basically the difference between the radio station is not the permission to have the music but what they do with it. Which music they play, how they talk, what kind of personalities they are. We'll have the same thing on the internet. Everybody has permission. You make a difference on top of the permission. Not because of the permission. That's where we're going with this. I think ultimately if you look at the printing press that gave us of course a statute of and copyright. Now the internet is going to give us the usage right. The right to use the content on a revenue sharing, on a license basis that built in as soon as you connect. There's no other way to solve this problem. Because individual negotiations of rights as we've seen the last 10 years always lead to a power play. And basically to the point where lots of companies want this but can't afford it and therefore become illegal. I have some more examples on this soon. So who's the number one issue here? Of course Google is where it all comes down to. That's especially the last couple weeks the debate about Google and content have been raging. Google does all these funky things. They do all this stuff and people think Google is the solution. If we just get money from Google we'll be happy. But guess what? In China four days ago if you use Google search engine in China, Google.cn which is partly owned by Google guess what? They have what we are not getting free music. Free, legal, authorized music. As of four days ago if you live in China use Google free downloads, free streams, all free using the search engine directly from the search box. Of course they had that before with Baidu. But it wasn't entirely legal by Western standards. So Google has gotten license deals in place with all of the major companies and the Chinese companies to create music on top of the system. So fields like free music for China unlimited mp3s which we've been discussing for four years paid with attention, with advertising and then China of course people aren't worried about selling CDs so that's really why it works there. Google is willing to lubricate that sounds kind of weird but they're willing to essentially grease the system. Somebody's going to have to put up some money and they did. I don't know how much but it probably was quite substantial. The industry is willing because China is lost as they've said for traditional copyright. This is a bizarre situation. I mean it's great for the Chinese people but us over here that have been faithfully buying from iTunes if we use the search engine we won't get this. Why won't we get this? Because we're not lost for copyright. We're going to have to keep on paying by the unit which nobody does anyway or being taken to court because we're not China. Think about that logic. Basically now Google says this is a funny quote from Google he says we can make money later. The Google chief of China said we'll put the money into this now because it helps our brand sounds a lot like some ISPs we can make money later and then Cai Fuli says we hope this moves the landscape to a legal model. I mean you have to applaud Google for taking this leap and my hunch is they're going to do this wherever they can around the world. Because there's enough money when the system actually works to pay for all of the music. Think about this for a second 4 billion cell phones around the world. If we got $10 a person a year which would be quite a mission but considering that you know around the world it wouldn't be that easy. We're talking about $40 billion that's almost twice the size of the music business. So if we were to wrap it into a service we would all make a lot more money. This is something that's going to happen and TechCrunch rightly says this is kind of strange if you live in China you can download for free otherwise you cannot. So of course the IFPI has been very happy about this which I find kind of interesting. This is the first time in a year, three months ago talking to John County about China some of you may remember he called it a landmark day which I would agree with for the rare occasions that we can agree. But of course I never had the tradition of not buying music. The translation of this for me is where can we if they say where can we still try to control distribution they won't do this but if it's lost they will do it. Now this brings an interesting question to buy any more music. We also get this and if it works in China why doesn't it work here? I mean this is an interesting question I think it very well could. Something to look at I think we already have the flat rate right there. I think we have to say goodbye to this model and this goes for both parties. This goes for Google being the guy or for the record labels or for whoever is going to be the guy. This model is not going to work. We have to switch to a model that uses what I call the new data economy the new content economy and next generation advertising. When I talk about advertising I'll have a quote in this a little bit later but I'm not talking about the old interruptive stuff. I'm talking about new way. If we combine that with the mobile phone population then I think we're going in the right direction. So the question really is what is the value, the future value of content? How is it going to be monetized? This is a huge issue which I'm not aware of because I only need another hour for that. I think this is a collaborative model that we're going to look at because we all have to get involved with doing this. Here's a quote from Mark Anderson a much smarter guy than I am from the Charlie Road show. These are all under monetized assets. Give me an example. Every video on YouTube, Viacom is suing YouTube, suing Google for copyright infringement. It's 180 degree the wrong strategy. They should be using YouTube as a distribution channel. They should let all the videos go on to YouTube. Every time there's a Viacom video on YouTube there should be a buy button and you're driving traffic directly back to the properties, you're selling DVDs, you're selling music, you're selling video games, you're selling all the stuff that Viacom sells. These are the distribution vehicles of all time. These are Nirvana. It's like master for the music industry. There's an interesting quote on this. I think if we're looking in this direction we can clearly say the PRS says when they talked about the breakdown of the deals with YouTube, they said Google made 5.7 billion in the last quarter and therefore they should damn well pay us. Which is, of course, not a far stretched logic. It's obviously a nice number to look at but YouTube is now losing 500 million this year and spending $1.5 million a day on streaming. If we put these numbers together I think what's happening here is we take the sort of golden egg that we have in the Internet especially starting not just with YouTube but with others and we're saying if we can just take that and make all the money but it doesn't work that way. The hosting costs 360 million a year. YouTube will stream 100 billion videos in 2009. Now imagine if we actually paid, they actually paid what was asked which is one cent per stream, one euro cent per stream. That's a billion euros a year. That's for the composer. I mean, it's great. I'm a composer. I'd love the money. But that doesn't seem plausible, does it? Because that doesn't even include the other part of the right or any growth of YouTube. So in that kind of system, how can we actually, I think what needs to happen is we need to move that golden egg into the center of the collaboration. We need to move to a place to where we can actually do this. I'm going to jump ahead a little bit and then I'm going to show you. I do have a summary I want to show you. And I think that's crucial. As usual, I have over-exhausted my time here. OK, so I think where we're heading to as far as the future of content is concerned, the age of punishment is coming to a decline. And as you can see, the whole free-strikes idea isn't going to fly anywhere except for France. Maybe. The European Parliament has voted 424 to 27 to not have anything to do with it. The idea of disconnecting people because they do stuff on the Internet. That is not going to happen. Instead, we're moving to this, to open platforms, to collaboration, to a trust environment. All of the big companies, including Nokia and others, are moving in this direction. With a new Internet license for music, keep in mind we don't just sell something, which is the music. We get the direct connection to the user. We get the user data. We get the marketing channel, the reducing of the costs. All these things are happening in the same direction. Now we'll just jump again and then I'm pretty much done. Bear with me for a couple minutes. So here's a quick summary. I think with all our business ventures, we should look at this first. Does it fit the broadband culture? Does what I'm doing fit into what people are doing on the Internet ? That's really sort of the measuring stick because ultimately that's where everything is going. We have to use the culture of collaboration. So I think what it means is that we have collaborative value creations that we create new dollars together. We make money around the content rather than just off the content by selling copies of it. And my favorite phrase, which of course is borrowed from Lare elastic, compensation, not control. The content is in the middle of what we do and of course it's the most important part but the money for the content is on the edges. The content isn't being monetized in the center of everything. It's monetized in many different ways all around it. Including stuff like packaging, like time shifting, like authentication, personalization, all these things that we talked about earlier. I think we're heading in this direction of where we just need to give permission for this to happen. And lastly I think it's also very important that we see the content now is in itself becoming a pool. So the product is in fact becoming the marketing like Nike Plus or something where we essentially take the content and offer it for streaming on things and generate money at the end of this funnel. Which is also a great mechanism for example for reducing cost. And a great example for this is Skype. Skype is a really interesting platform. Skype from Skype says essentially I'm free, so now 280 million people are using it. But guess how they make money? The merit and trust gets my money. I buy a Skype out number or a Skype in number or a global roaming deal or mailbox or whatever. I buy things from Skype. That's how they do this. That's how they turn that into money. So we're going to see the creation of a place where the content is metered and basically permitted. And this is going to start with music and already has. And Denmark already is looking at in Canada and of course in China as I explained earlier if we just give permission for it. The filtering will be paid for. I think there's lots of business in that. And I think most importantly the process of collaboration is what's going to get this whole thing going. I think really this is a question of the content owners, the telecoms, and the advertisers actually collaborating to create what I call this new ecosystem. I promised I would end and so here I do. Thanks for listening. Please feel free to send your comments and talk back to me on Twitter or whatever you want to do. Befriend me, follow me and pursue me whatever you want to do. We have your permission. Thank you.