Yong Ying-I, Chief Executive Officer, IDA Singapore - Keynote Address Fast-track Seminar, Suntec Singapore
Yong Ying-I, Chief Executive Officer, IDA Singapore - Keynote Address
Fast-track Seminar, Suntec Singapore
Singapore, 26 April 2001
Good morning, Minister, distinguished guests, ladies and gentlemen.
1 I am happy to be here this morning at the Fast-Track Seminar. As the Minister has spoken about our broadband achievements and the major initiatives going forward, I will not be speaking on that. I would like to take us a little further out, and talk about some of the exciting developments and challenges facing us as the industry develops
2 I want to clarify that this is not a policy speech nor a definitive statement of programmes that IDA will start up tomorrow. What we are going to do this year has been described by the Minister. I hope in my speech to raise some ideas as food for thought for participants at today's seminar. I hope that today will provide an opportunity for everyone to share their views about a very dynamic market and for IDA to learn from your insights.
3 What IDA is looking for are answers to what lies beyond the core broadband and multimedia activities that we are already aware of. Our problem is that the range of possibilities is growing rapidly and exponentially, and it is getting harder to grasp what lies ahead. I was asked by a team of scenario planners from one of the government ministries what I thought Singapore would be like in 2025! Gosh. I told them that I didn't know, but I started describing to them changes that were already taking place this year and next in Singapore, all leveraging broadband and wireless - The scenario planners left my office extremely worried! I told them about smart homes and smart communities; virtual or fantasy environments; digital cinemas; primary school children in our schools working on their own online learning material to share with their fellow-students; paying for your can of soft drink by pointing your mobile phone and getting the can of drink included in your phone bill; wristwatches that can monitor the heartbeat of the elderly at home and call the ambulance if they have a stroke. I told them that Rick Perry, the Governor of Texas in the US had just projected a holographic image of himself to deliver a speech at a conference. I am thinking of testing this on Minister Lim soon.
4 Perhaps these dizzying changes explain why venture capital money is still going into broadband despite the current weakness in the telecoms and technology sector. A key recent announcement was by Softbank about establishing an Asian Broadband fund. I therefore believe that the range of possibilities will expand, and developments for the industry as a whole will be very exciting. However, the changes will be very disruptive for established businesses which will have to struggle to respond to these developments.
5 One of the affected industries is the music and entertainment industry, which faces issues ranging from fundamental questions of quality of service and how to manage channel distribution to questions of online purchasing, rights management and free-music or free-radio services. There has been a barrage of claims and counter-claims, partnerships, mergers and reversals that many find it difficult to remember who now works for whom and who offers what service. An interesting example is a statement from the International Federation of the Phonographic Industry (IFPI) that a worldwide music sales drop of 1.3% in 2000 to US$36.9 billion was "evidence of the impact of free online music."
6 The experience of the music industry underlies one of the key forces impacting developments. It is called "convergence" and I thought that I would talk about this today.
7 The broadband industry is itself a convergence of communications and information technology industries. This created a platform that has a plethora of ways to reach users and be reached by users. The convergence of the two merged the complexity and intelligence of computing with the reachability and efficiency of communications in a digitized and customized service.
8 Convergence between the online broadband industry and the music and entertainment and broadcast industries will come next. The evolution of digital media will challenge every aspect of today's media and entertainment business. As broadband, digital TV, the internet and wireless come together, we will see new demand for digital audio-visual content that fuse together multiple traditional media. There are US media companies which have integrated editorial teams putting out the same story simultaneously to TV, radio, newsprint and online news. TV shows such as "Big Brother" have an extensive internet component. Animated features such as "Toy Story" provides the basis for video games and online multi-player gaming which are huge revenue generator. For the MTV generation, music will naturally lead to music videos and internet content.
9 These services can be deployed on a multitude of platforms ranging existing devices like digital TVs and mobile phones with MP3 capabilities to futuristic devices like set-top game consoles with network, storage and DVD capabilities, or PDAs with built in mobile phones and even wearables that can activate music recordings and personal conferences.
10 Convergence thus means that established business models, management processes, production techniques - all face redefinition. The mature techniques developed for celluloid films, for example, are not appropriate for all electronic production techniques or instantaneous digital distribution. Media industries that used to be local businesses will now face global influences and global competition. Previously discrete businesses will become integrated. Where media production used to be centralised, it is likely to be distributed geographically around the world. Let me speculate aloud: the global film industry used to be centred around one city, Los Angeles. As the computer becomes a camera, and as big communications pipes connect cities, there are film makers who have suggested that the approach to film making will change. Cities that will be part of the global film industry are New York and San Francisco, Montreal and London, Paris and Amsterdam, Bangalore and Sydney, Singapore and Shanghai.
11 The hub concept may not apply. This is because no single city is likely to be everything to everybody; it is not the concept of a hub but that of being a node in a global network that matters. This is collaborative-commerce applied to the media industry. Each city contributes its own capabilities and specialisation. Pre-and post-production may be done in Singapore; part of the shoot may be in Sydney; animation may be done in Bangalore and Shanghai.
12 It may be useful to clarify that the distinction between traditional media and new media is more about the type of activities rather than the specific companies. As media companies know, the traditional activities will continue to be the major revenue component for quite a few years yet. The mainstream companies also have the experienced pools of creative talent. The issue is applying what they have in different ways, and realising synergies by collaborating with newer high-tech companies.
13 IDA is giving a lot of thought to the strategic components that we believe are necessary to help ensure that Singapore is ready and able to participate in the emerging business areas. Let me mention some of these areas:
14 First, technological and infrastructure readiness. Through Singapore ONE, we already have a nation-wide infrastructure. But there are a host of issues and gaps when it comes to developing smart homes or smart communities. Many of these micro-level gaps will need to be filled or obstacles removed if we are to support the developments needed. IDA is studying this.
15 Technology and infrastructure capabilities also includes understanding some of the production, post-production and studio and printing needs and processes so that we can establish the use of broadband as not just a transmission mechanism, but a service infrastructure for media. (This could also include merging the current multimedia capabilities with the media's production capabilities into seamless cross-platform content and service creations. )
16 The second area is to develop the people with the skills, creativity and knowledge to move rapidly ahead this area. Our people must be encouraged to explore the unlimited possibilities that a career in the industry can offer. We need to have digital and interactive content producers, production crews, effects specialists, writers, translation and repurposing talent, technical designers, technologists, syndicators and distributors of the new types of cross medium content. To support the widespread development in a global and multi-industry arena, we also need people who understand this medium, know how to pull the various people together and manage the various cross industry and multi-party projects and contracts effectively. These can be domestic or international talents. They need not even live full-time in Singapore. The point about being part of a global network is that talent will flow fluidly between cities in that network.
17 Our institutes of higher learning, led by the polytechnics, already provided training in areas like animation. But given the rapid changes in this industry, it is important that we continually revamp our curriculum. Given the high quality and low cost of animation products that I have seen from India, I doubt that we can build a competitive advantage if we limit ourselves to this. I urge both the broadband and media industries to collaborate with the IHLs to review the talent needed for a worldclass convergence industry. There is a gap between our current capabilities and the skills we will need to understand. On our part, IDA will assist by facilitating and supporting such collaborations and developments - whether in developing shared networking resources or in specific pilots and programs requirements.
18 The third strategic component is the access to international markets and capabilities. This does not imply wholesale export of services or wholesale import of foreign investments or foreign talent. I had earlier called it collaborative commerce -- it implies the need to have collaborative relationships and partnerships that allows us to work with the various media conglomerates and industry players worldwide. Forming the necessary relationships to tap into these global talents is now a crucial task for our industry - be it the scripting and acting talents in Hollywood, the animation and gaming capabilities of Japan or the special effects and programming talents in India amongst many others. However, we should focus on areas that interest us and that we are good at, so that we can offer expertise and knowledge that complement their own capabilities and are valued by our partners. This strategy of complementarity is what Singapore has been arguing in developing bilateral ties with India, China and so on, and it appears to have some resonance with companies from these countries.
19 The fourth area is definitely the responsibility of the government - namely a policy and regulatory framework that enables convergence to happen rapidly and smoothly. There are many issues to think about, whether it is in the region of licensing, interconnection and market access, interoperability and open standards, content regulation, multi-platform digital rights or digital signatures and micro-payments. For example, if a few devices replace the variety of appliances currently in use for sending and receiving messages, for computing and entertainment, government will need to have rules for ensuring access for pricing access and for non-pricing issues. For new businesses at the intersection to happen, such as interactive TV, we will need to put in place a supporting policy and regulatory framework.
20 These four components will serve as the base to develop different areas of service offerings on the convergence platforms. To get these going, it is important to encourage experiments to test and push the envelope of the new platforms and services. A mixture of commercially viable content with experimental and even audience content would be needed. IDA looks forward to working with various industry partners and agencies to encourage some of these developments.
21 I hope that the Broadband Media Association launched in January can play a focal point to bring industry partners together and help us highlight and address the necessary issues.
22 In Singapore, companies are already beginning to move into partnerships to try to understand what convergence will mean to them. Examples of these include the Kadokawa, Sumitomo and Compudia Joint-Venture that will be signed afterwards, the joint work between M&E, InnovaTV and Pandora and the announcement of the Avatar Exile joint production. We wish them success and we look forward to hearing, supporting and facilitating more such examples and developments.
23 I started the speech by saying that what I would talk about today are exploratory ideas, not concrete programmes we will launch straightaway. One reason for sharing them with you is because I believe strongly that it is through discussion and tossing ideas to and fro that new insights are born. I had the pleasure last weekend of hearing Mrs Carly Fiorina, Chairman/CEO/President of HP, talk about HP's journey of rediscovering its roots as a company that emphasises invention. One of her theories about the factors that must be in place for innovation is the ability to hold opposing thoughts simultaneously; to iterate the ideas and churn, churn, churn; to allow the friction between the ideas to create insight. As Singapore moves into uncharted waters, we need to iterate ideas. I hope that you will help us firm up our ideas, so as to move forward concretely in this exciting area.
24 Thank you.