Industry Expertise in the Digital Media Industry: Specialization vs. Disruption of Online Business Models

In the digital media sector, the importance of industry expertise has become ever more important through the concurrence of various factors: technological specialization, user-centric business models and product development frameworks as well as the need for a profound understanding of business drivers in data analysis. Additionally, this tendency is fostered by the growing relevance of informal networks and increasing regulation. Such renaissance of industry expertise clearly provides opportunities, especially by optimizing business models and products in order to create even more value for the customer. However, risks and conflicting developments are substantial: the digital transformation of media business models is not yet at a final stage (and is expected not to be complete for a long time), and the likelihood of disruption has increased, particularly given the convergence of industries and value chains that used to be entirely separate, e.g., entertainment offerings by telecommunications or technology companies or concepts such as driverless connected cars. One should also bear in mind that organizational culture is more company specific rather than industry induced and that the fit with such culture or at least its malleability is a major success factor for management. In short, management in the media industry should retain its more generalist approach. If value creation for customers becomes the decisive factor, it can in some cases be achieved through a stronger industry orientation and optimization of products and processes; in others, however, it may be necessary to innovate the business with concepts from adjoining or even remote fields. Industry know-how and expertise can be intensively utilized through new types of networks, but must always and constantly be challenged and contrasted against other industries. The sum of specialization trends should be balanced with an organizational culture that encourages regular questioning of industry-specific assumptions.