Convergence benefits elude media, telecoms and IT companies, new research finds

More than ten years after media, telecommunications and information technology began to converge, few companies in these industries have been able to capitalise on the trend. Convergence offers firms vastly improved capabilities to understand and reach their customers, but has also made control of customer relationships much more difficult. Customers now find it hard to distinguish between content, distribution channels and the technology that underlies them. Media, telecoms and IT firms themselves are often unclear which technologies will best help them understand and reach customers; most also acknowledge not having a clear understanding of their customers' behaviour.

These are the main findings of a study by the Economist Intelligence Unit and sponsored by Oracle, Converging on the customer: new media for closer relationships. The report is based on a survey of 168 executives in the media, telecommunications and IT industries worldwide, as well as in-depth interviews and other research.

The study shows convergence to be a double-edged sword: it provides an unfiltered window into customer behaviour, but also blurs the lines of communication between companies and their customers. “We live in a murky world,” says Ranjan Kapur, Country Manager in India for WPP, a global advertising and marketing firm. “Convergence is complicating life. It’s no longer clear who owns the content. It’s no longer clear who gets to monetise that content. And it’s no longer clear who owns the customer.”

Other key findings of the report include the following:

• Social media provide companies with an unprecedented opportunity to know their customers better. Social networks are becoming a more important part of company strategies to become more focused on their customers. Today, such things as Twitter, Facebook and LinkedIn are important to just over half of companies. Nearly 70% say that they will become an important tool in the next 12 months.
• The battle for customers is playing out on mobile devices. Ninety-two percent of survey respondents say they have either developed or are investigating a mobile application strategy. Firms are competing for attention on the small screen of a mobile telephone in the hope of gaining fresh insights into the behaviour of their customers.
• Firms are struggling to figure out how to benefit from new technologies. Although 74% of survey respondents see emerging technologies in general as an opportunity to increase revenues and margins, half have trouble identifying which technologies they should use to achieve those goals.

Converging on the customer: new media for closer relationships
is available free of charge at
www.eiu.com/sponsor/oracle/convergingonthecustomer

Press enquiries:

Joanne McKenna, press liaison, +44 (0) 20 7576 8188, joannemckenna@eiu.com
Katherine Dorr Abreu, Senior Editor, +1 212 554 0637, katherineabreu@eiu.com

Notes for editors

Converging on the customer: new media for closer relationships is an Economist Intelligence Unit report, sponsored by Oracle. The research is based on an online survey of 168 executives worldwide, in-depth interviews with executives and other research. The survey was conducted by the Economist Intelligence Unit in September and October 2009 and examined the challenges and opportunities created by convergence. Their companies’ primary industries are telecommunications (38% of respondents), information technology (36%) and media (16%).

The survey has a broad geographic reach: 30% of respondents are based in Western Europe and 29% each in North America and in the Asia-Pacific region. The remaining 12% are based in other regions. The companies range in size from those with annual revenue of US$500m or less (47% of respondents) to those with revenue of US$5bn or more (26%). The remaining 27% have revenue of US$500m to US$5bn per year. The level of seniority of respondents is high: 47% are C-level executives or board members. They fulfil a broad range of functions in their companies: 40% are involved in strategy and business development, 38% in general management, 29% in marketing and sales and 21% in IT.

About the Economist Intelligence Unit

The Economist Intelligence Unit is the world leader in global business intelligence. It is the business–to–business arm of The Economist Group, which publishes The Economist newspaper. As the world's leading provider of country intelligence, the Economist Intelligence Unit helps executives make better business decisions by providing timely, reliable and impartial analysis on worldwide market trends and business strategies. More information about the Economist Intelligence Unit can be found at www.eiu.com or follow us on www.twitter.com/theiu.

About Oracle

Oracle is #1 in Communications globally with 100 of the world’s top 100 communications companies running Oracle applications and technology. Oracle Communications integrates industry-specific BSS and OSS solutions with a standards-based service delivery portfolio, as well as the capabilities of Oracle’s industry-leading enterprise applications, business intelligence tools, and carrier-grade middleware and database technologies. Oracle Communications enables service providers to deliver next-generation convergent services rapidly, increase customer satisfaction and loyalty, and reduce costs in the business and the network. For more information, visit www.oracle.com/Communications.