Hollywood Information Technology Research Study

As part of its effort to develop its first Hollywood Information Technology Summit next fall, ESCA has recently concluded a CIO research study in order to discern the "burning issues" for the Hollywood IT community.  

The following issues and opportunities were confirmed and discussed as part of these discussions:

• Nearly $1.5 billion have been spent by the Hollywood Studios, except 20th Century Fox and Sony Pictures Entertainment, and the DVD replicators on SAP in the last five years. Each installation has been a stand-alone learning curve with virtually no sharing of experiences in the industry of the IT professionals.

• Now that SAP and Oracle have enabled the entertainment industry to establish the standard business processes of ERP (Financial Management and Human Resources) that are at par with other industries, the executives face the challenge of achieving an ROI on the huge infrastructure investment already made.

• Standard software solutions provided by SAP do not meet the industry-specific requirements of the business. Consequently, numerous age-old legacy systems have been retained and interfaces developed through extensive customization. The result has been the high overall operating cost of IT with high cost of maintenance, lack of being current with software revisions and upgrades created by SAP and Oracle, inability to achieve efficiency in generating business intelligence.

• Data Synchronization in the B2B world, particularly with retailers, replicators and distributors is hampered by degree of customization and spaghetti like codes.

• The entertainment industry suffers from the lack of standards necessary for data synchronization with its trading partners and the less than optimal accuracy and timeliness of data from retail

• The business systems for the various divisions of the Hollywood Studios, namely 1. Film, 2. Television Network, 3. Home Video (Home Entertainment), 4. Music (in some cases), 5. Video Game (in some cases), and 6. Theme Parks remain segregated from software platform point of view but may share a common infrastructure of hardware and related services where the CTOs play a significant unifying role.

• The emerging world of digital content delivery over different channels, different formats and multiple devices has produced additional challenges of transformation from a physical supply chain to a digital one where the necessity content security is paramount. Considerable opportunities exist for leveraging business systems of the divisions. As a matter of fact, the Intellectual Property Management, Product Life Cycle Management, Back-Room Operations and Digital Pre-production may have significant potential for leveraging corporate resources.

• Online digital distribution and a seamless experience across multiple channels of distribution are becoming increasingly important.

• The emerging technology of RFID is likely to create a serious overload of data and requirements for middleware and business intelligence.

• The organizational structures of many studios where the CIO reports to the CFO creates an environment where the strategic objective to achieve Financial Control become paramount.

• We must breakdown any silos that may exist between the functions of IT, Sales and Marketing and Operations of many of the enterprises in the industry.

• If demand-driven supply chain has to maximize its effectiveness, the functional excellence we have achieved over the last three decades through IT has to give way to Business Process excellence where Service Oriented Architecture (SOA) has to be deployed.

• Today, the primary supply chain issues affecting the entertainment industry are 1. The Last 100 Feet at Retail where execution is grossly deficient, and 2. Demand Forecasting and Rapid Replenishment. Information Technology, which is the Holy Grail of the supply chain, can have a very positive impact on the profitability of the industry. A recent research commissioned by the Operations Heads of all the entertainment companies has confirmed that the issues of In Store Execution and Data Synchronization have a huge impact on sales and profitability.