11 Oct, 2022
On September 21st, at the Entertainment Evolution Symposium in Los Angeles, MESA brought together the industry leaders, Associations, and Pepperdine University. The energy was palpable because many people had not attended a physical event since 2019, and we were all happy to participate.
The topics covered were no different than in previous events — data analytics, forecasting revenue models, and the direction of the industry relating to M&A and streaming.
Yet, as the industry continues to morph and leaders address the new challenges that arise, one area that needs long overdue attention is: how we can introduce better technology at early stage of content? Greenlight through Amortization are the birth stages of content. These processes bring life to content through the financial supply chain; this is where it starts.
I started in this industry with MGM, when the top-selling VHS titles were Overboard and Roadhouse. That was 23 years ago. When a theatrical release did poorly at the box office, the studio could make up for it at the Home Entertainment release window. Today, the shift is to streaming, and it's all about the subscribers, which requires both quality and quantity to be competitive. Managing costs is more critical than ever because there is no opportunity to compensate for losses.
The industry is talking about the connected consumer, uses of data with AI, and Web3, all of which are pivotal advancements. However, the content ideation and approvals processes have remained insulated from advanced technologies and continue to be managed via email and Excel. The business units that fall under Greenlight through Amortization are the initiator of our content chain, the content-financial supply chain.
Finance, budgeting, and production accounting are in dire need of advancement or integration because the current tools are antiquated, single purpose, not easily accessible, and can't keep up with the demands of today. invenioLSI’s product, Content Financials, is a proven solution designed and built for the media industry leveraging SAP S4 HANA technology. This product is the enabler, not the replacement of roles.
I find it fascinating that seven of the nine prominent studios/streamers heavily invest in SAP technology but do not use it to its capacity — akin to owning a Lexus just to play the radio. I am not talking about advanced technology such as AI or ML. I am referring to an automated workflow that is part of an asset already owned by the studios — the same studios that currently produce most top films, episodic shows, and international content.
Part of SAP's Media Value Chain, our solution focuses on the financial management process across the many departments that play a role in content creation, with detailed financial planning, control, and reporting at its core. Departments such as finance, marketing, production, and operations, which previously worked in silos, will now work on the same system improving transparency and efficiency.
Our industry has benefited from technology in many parts of the content supply chain. But it is high time we facilitate the content and financial supply chain that provides everything downstream from production, post-production, and distribution, each area employing millions across the globe.
SAP is the industry’s financial system of record and is built to enable every aspect of a studio's business units. Therefore, I strongly recommend that any studio, streamer, or media company leverage its capabilities more than ever, given that it is already available. For those organizations searching for an integrated enterprise resource planning system, SAP’s S4 HANA Cloud has the best low-cost entry with all the value needed to get your studio/production company/streaming business in a competitive position.
The industry will continue to advance with technologies that enable virtual production, cyber security, and AI-driven localization. However, let's make sure we establish a foundation of scalable automation at the source of content production.
Learn more by watching James speak at the event!