The end of summer is always bittersweet. Back to school time marks the end of vacation weeks, long weekends, barbecues and for most people, the opportunity to wear shorts. Here in Florida where shorts are always appropriate, it means only five more weeks of oppressive heat until we return to climate paradise. Of course, that is in turn balanced by living in a driving hell, as overmedicated snowbirds clog our roadways and change lanes without signaling. On the bright side, those swerving Cadillacs also signal that football season is underway, which makes it time to get the jump on the digital signage prediction cycle.
Every year at this time, I try to come up with seven predictions for the coming year in our industry. In addition to being the name of George Costanza’s mythical firstborn, seven is a hat tip to football, it being the value of a touchdown and an extra point. The predictions are the result of lots of conversations with end users, vendors and the occasional pundit, as well as data visualization based upon random twitter streams. Before diving in to the shallow end of the prediction pool, it is customary to take ownership of the accuracy of last year’s set. So here we go:
- Proximity marketing gets closer: Got it wrong that Apple would unlock its NFC chip, but had the part about a proliferation of beacon tests right, as well as noting that beacons and NFC would have different use cases. More on this in this year’s prediction. Near miss
- Content rationalization steps forward: I jumped the gun on the acceptance of software to autocorrect content encoding and making content auto-magically responsive. While there is little doubt that it makes perfect sense and it is coming, it didn’t happen in a meaningful way in 2015. Miss
- Sun Tzu comes to digital signage: I foresaw unnamed titans preparing to make a move to own it all, wiping out their partner ecosystem in the process. Again, it didn’t happen in 2015, but the tea leaves haven’t changed much. Miss
- It is, and will remain Digital Signage: The silly suggestion to rename our industry Public Video was a success in pandering to a customer, but an abject failure as a movement beyond that. It is still Digital Signage, and by the way NOT Dynamic Digital Signage. Hit
- NYDSW becomes a fixed part of many marketing budgets: The continued growth of the event calendar and attendance during NYDSW is testament to the hunger for diverse yet related programming in the fall. This year, NYDSW is the week of November 2nd. Y’all come. Hit
- Consolidation accelerates: I predicted an increase in M&A activity as well as a fair amount of personnel movement. The M&A side of things did not disappoint. Planar, IZON (nee PRN), Aerva, Touchtunes, Yesco, and Coolux were among the companies involved in transactions. While we did not see any major shuttering of companies that might have been expected, the dealmakers were busy, and lots of smart, experienced people (and others) changed horses in 2015. Hit
- Programmatic or problematic?: Noting that the hype cycle for programmatic buying was at peak levels at this time last year, I predicted that the path to programmatic would remain a dilemma for digital signage for a number of reasons. The challenges remain intact, and the success stories and growth remain elusive. Hit
Final tally for last year’s predictions: 4 hits, two misses and one near miss. Not bad. Maybe this year we will take a few more chances. Let’s get on with it.
- LEDs emerge and prices start to drop: The Yesco acquisition by Samsung and the Planar acquisition by Leyard were about gaining market share and product portfolio for the former, and North American distribution, for the latter. They represent the visible tip of the iceberg, as other traditional display manufacturers are looking to expand product offerings with LED, and the once upstart Nanolumens has grown up to pre-IPO phase. The Infocomm show floor looked like Times Square with many (predominately Chinese) LED players pumping out high wattage monsters. The stage is set: LEDs of many sizes, shapes, use cases and pixel pitch factors will flood the market, and prices will continue to drop as a result.
- DPAA mission evolves: The Digital Place-based Advertising Association, more familiarly known as the DPAA, has slowly morphed its membership model over the past couple of years. Once effectively a club in which members paid big bucks to sponsor private research and drive standards, the DPAA now takes on members at significantly lower dues rates. Despite that, legacy big players are still asked to pay high rates, and are counted on to add to the kitty by sponsoring events such as the upcoming Video Everywhere Summit. DPAA’s focus on media, advertising and research on out-of-home remains, but its value proposition to members must shift somewhat as its member demographics change. There is danger of friction between factions (both old and new) and my guess is that the DPAA must resolve that before it goes further, which may involve re-inventing itself or recasting its mission and how it spends its money. As an aside, one hopes that the DPAA aligns the date of their 2016 Summit with NYDSW. It would be a further signal that they want to embrace the industry at large and develop that week further rather than forcing a sense of exclusivity via scheduling.
- In proximity, beacons recede while marketing advances: In my last post, I referred to beacons as a dog whistle, hypersonic distractors to those with specially tuned ears. There are many beacon tests in play, and you can expect to hear much more about the tests than the results. In 2016, I believe that the focus of marketers and digital signage network operators will turn from a technology (beacons) toward a concept, proximity marketing. Or put a different way, execution as opposed to tools. The difference will be actual integration with digital signage in a more natural manner than beacons offer both for the technologists and the customers. Key words to remember will be “opt-in”, “privacy”, “wifi”, and “triggers”.
- Bigs move their chips: The big players have been in and out of digital signage since the very beginning of its growth curve some 12-15 years ago. In retrospect, all of their bets can be characterized as dabbling relative to their size, usually in enabling software. Cisco and Intel made tiny software acquisitions relative to their size with no impactful results. Oracle sniffed around through a partner company. Harris, now out of the business, made a relatively small deal to get Infocaster and subsequently invested heavily in it before bailing out. Google raised eyebrows by appearing at DSE in 2014, but has likely determined that digital signage is not enough like online advertising to excite them, although they will be happy to push boxes and use partners as probes. Going forward, I believe the big companies will express their interest in the digital signage space via marketing and data-based points of entry, rather than through backend software and devices.
- No public pure plays: Here is one that is binary. It will either be prescient or absurdly off base. Today there are arguably two public companies that are pure digital signage plays: RMG Networks and Creative Realities. Neither derives any discernible benefit from being public at this point, and they pay a heavy price to support public company compliance requirements. Further, their ability to raise new cash through a normal secondary is near zero due to stock performance. The prediction: at this time next year, there will be no public digital signage pure plays. My hunch is that RMG goes private and CRI just goes.
- Trolls back under bridge: 2014 was a busy year both for patent assertion entities, more commonly referred to as trolls, and those fighting hard to de-fang them. Our industry’s busiest troll, Activelight, has been relatively quiet since last year, likely due to the legal and health problems of its primary stakeholder. While there is reason to fear the sale of his interest to his hedge fund backers or other PAEs to defray his ongoing expenses, other forces are in play that might keep Activelight and others at bay. Cross-industry entities such as United for Patent Reform and many other groups and individuals are working hard to get Congress to do what is right and make important reforms in law and in practice at the PTO. No one ever made money betting on politicians to do the right thing, but the odds are even between real reform passing and some kind of window dressing Act being passed that does nothing. Let’s hope for the best in the name of innovation, real inventors and small businesses everywhere.
- Content triggers become more relevant and interesting: The cornerstone of digital signage is and always will be relevance in context. The next wave of making digital signage content more relevant will without doubt be triggered content, content that changes in near real time as a result of some type of external data point. That has always been possible in simple use cases (pick up an item, react to weather forecast), but only becomes truly relevant when something is known about the audience at a specific moment in time and content can be delivered while that knowledge can be leveraged. This has been conquered online in the most annoying ways possible using cookies and retargeting software, but can be done more subtly and effectively with digital signage as the sources, quality and speed of data analysis improves and scenario-based content can be delivered quickly. Hopefully not like that Tom Cruise movie whose name shall not be typed here. 2016 should be the year where some of these strategies start to appear and get sorted out.
There you have it, seven for 2016. Times are becoming more exciting for our industry and there are many more moving parts than there used to be. I am sure to have missed a few layups here, and my Sunday basketball buddies will tell you that is not unusual these days. Feel free to opine on these or add your own predictions in the comment section.