It is the Internet companies such as Google, Yahoo!, eBay, AOL, Microsoft, News Ltd and Amazon, which by evolving their services and capabilities are forcing the industry to change. They are breaking down the old business models which were mainly built around monopolistic market structures.

Traditional media companies have realised they can longer treat the Internet simply as a fad; the reality is that these developments are well and truly eating into their businesses. The industry has had no choice but to finally begin moving in more innovative directions. The telcos will also need to work hard to keep up, as they too have lost the lead they had in the market for the last five years.

The focus is moving towards content and applications, and this requires a change in marketing strategies. The market is now moving from supply driven (telco) to demand driven (Internet), and those with the best marketing and customer service capabilities will win; technologies are rapidly becoming commodities. Convergence will inevitably lead to a structural separation between infrastructure and media players.

Triple play is the first telecoms derived business model designed to deliver some of the newly integrated products. While there have been some positive developments in countries such as France, Italy and Hong Kong; by and large it has not been the success story that was anticipated. It is the Internet media companies that are now setting the trend and the business models emerging from their stables will become far more important in the future.

A key to success in the new era of digital media revolves around advertising. New advertising business models are now emerging, giving the industry the confidence to begin changing their more traditional models. The phenomenal growth in online advertising revenues is also a driving this trend.

In order to maintain their positions and compete in the new market, leading Hollywood players have digitalised their collections, and in some cases set up online content distribution services. Others have established partnerships with existing content distributors and packagers, and the content is promoted and sold over the Internet or even mobile.

Current broadband developments will finally lead to the much-vaunted phrase ‘Interactive Multimedia’, and this in turn will bring one-to-marketing opportunities based on video communications and interactive digital TV networks. It is expected that by 2015, 65% of all New Media revenues will be based on permission based marketing.

Search services are central to almost everything that users do online, and this places leading search companies such as Google and Yahoo! at an advantage in the new market. Google is the industry leader, dominating the worldwide search market with around a 60% market share.

The value of search services also became evident with Microsoft launching its own search engine ‘Live Search’, and Amazon its ‘A9’ search engine. Traditionally known as a web encyclopaedia, Wikipedia is also attempting to move into the market, with the proposed launch of a search engine in 2007.

User Generated Content (UGC) will see the largest growth this year; video-based consultancy, monitoring and communication services will also see significant growth.

The USA continues to play a leading role in the development of new digital media markets, being home to many of the global digital media giants such as Microsoft, Google and Yahoo!. In 2010 over $2 billion will be spent on social network advertising in the US.

Cable TV is set to play a pivotal role in China’s converged media environment, as triple play services - which include the provision of television, telephony and broadband Internet access over a single network - begin to be delivered over cable TV infrastructure. China has the largest cable TV network in the world.