The Convergence of Business and Technology

While technological convergence is no longer a new idea, the fascination with the subject lies with the capabilities and applications of both hybrid and brand new technological platforms and the ways previous stand alone industries, have been reconfigured and thereby mobilised to provide enhanced service delivery. Such convergence pertains to the “digitisation of communications and the ways discrete media formats have become accessible to other media forms; have been further factors in this process” (Saltzis, 2007). In technical terms, Saltzis (2007) reminds us that “the new technologies convergence can be attributed to developments in digitization, bandwidth and compression; as well as interactivity.

Moreover, the rapidity and pervasiveness of technological convergence has seized the entrepreneurial imagination and arrested the attention of economic rationalists, with respect to “the devices used by institutions within the communications and media industries, as well as the information they process, distribute, and exchange over and through these devices” (Mosco and McKercher 2008: 37). Such convergence also focuses upon the “integration of or interface between and among different media systems and organizations, made possible by the development of new technologies” (Mosco and McKercher 2008: 37).

With this being said, a more fertile field to explore, derives from the recognition that while technology continues to converge, so does the corporate world. The nub of this issue is the nature and extent of the link between these two types of convergence, and the nuanced ways in which one shapes and is shaped by the other. Corporate convergence, according to Babe (1996:284-285) refers to the “mergers, amalgamations, and diversifications, whereby media organisations come to operate across previously distinct industry boundaries.” Babe extends this explanation stating that corporate convergence refers to the non-technical features of convergence, which also “contribute to the blurring of industry boundaries” (Babe 1996: 284-285). Examples he cites in the 1990’s from his Canadian context include “ Time Warner combining book publishing, music recording, and movie making, not to mention cable television, (while) Rogers Communications, Inc. engage in newspaper and magazine publishing, long-distance and cellular telephony, cable television, and radio/television broadcasting” (Babe 1996: 284-285).

While it is self evident that “corporate convergence promotes and is promoted by technological convergence” (Mosco and McKercher 2008: 37), closer attention is warranted to examine the nature of the promotion and the ways these two significant convergences influence each other. It is illuminating as we do this to itemise dimensions of technological convergence, to begin to pinpoint the areas of synergy between technology and corporate enterprise. The International Telecommunications Union (ITU) has been helpful in its examination of convergence, by singling out ‘device convergence,’ ‘network convergence,’ ‘service convergence’ and ‘regulatory convergence’ (ITU 2008). While the ITU cites examples of devices include mobile phone, camera and internet access device, network examples include fixed-mobile convergence and next-generation networks (ITU 2008). Moreover, service convergence is exemplified by voice services over the internet; not to forget regulatory convergence for broadcasting and telecommunications, citing the example of the Office of Communication (Ofcom) in the United Kingdom (ITU 2008).

The view of convergence from the corporate stakeholder, according to Andriole (2005:28), is ideally a “multi-disciplinary, anticipatory, adaptive and cautious” one, no longer about “early adoption of unproven technology,” but instead about questions of “business technology acquisition, deployment and management” (Andriole 2005: 28). The sense that the momentum has changed within the corporate sector, prompting corporate leaders to be ready to have ‘convergence conversations’ is clearly articulated by Andriole (2005). It is advocated that companies will benefit by thinking in terms of “business technology convergence plans” (Andriole 2005: 28). Instead of technology being a footnote or a discrete department within a corporation, through its own array of convergences, it now occupies a central position in underpinning corporate cultures. As a response to this generational shift in consciousness, business planning now closely consults with technological providers, shaping corporate decisions and goals. This change of thought led spawned a new series of business planning questions, which demonstrate some of the links between technological and corporate convergence. Questions which illustrate this include: “‘How does technology define and enable profitable transactions?’; ‘What business models and processes are underserved by technology?’; ‘Which are adequately or over-served by technology?’” (Andriole 2005: 29)

Now when strategic planning is tabled as an agenda item within companies, the matter of technological capabilities is taken seriously, as corporations realise that sidelining technological innovation, is a stepping stone towards giving away market edge to one’s competitors. Indeed, Andriole (2005: 30) forewarns of the perils of business technology segmentation. Instead of a new business initiative being conceived then asking what technological capability exist to support it, Andriole (2005: 30) argues that technologists must be present as part of the materialisation process of a company’s development goals and strategies.

One fundamental area a business model which values efficiency and effectiveness is the calibre of the internal and external communications systems and infrastructure. In the 21st century business context of global interfacing, communications which are “pervasive, secure and reliable” (Andriole 2005: 30), are a base line issue. The incentive to acquire such state of the art systems is one factor driving further technological convergence, as the market demand fosters technological innovation to bring market edge to communications. The airline industry is a practical case in point, with specific international airlines branding being fostered by the level of their onboard entertainment systems for travelling customers. Some international airlines have invested heavily in this component of their corporate identity to enhance their market niche, displaying convergence through the multi-media, multi-channel video and music on demand, personalised entertainment systems, which now permit replay and play back functions (Yu 2008).

We are reminded us that a large area of compatibility and synchronicity between technological and corporate convergence relates to the classical knowledge networks, such as universities, corporations and investors, who derive great benefits from convergence, finding more penetrating ways to exchange information and knowledge, their primary resource Saltzis (2007:2). Additionally, since political, economic and financial power is derived from shared information, the value of corporate convergence to the stock markets and to companies is self evident. In relation to the priming of information flow via the synergy between corporate and technological convergence, some observers are beginning to draw attention to the sociological trend that knowledge, through these processes, has become less of a community resource and increasingly a commodity. As information is commodified, it is packaged to target specific interest groups and economic stakeholders, who prize specific knowledge for specific outcomes, in terms of client need and demand. This instance of the knowledge super highway shows that knowledge can be ‘positioned’ within the market with greater precision through convergence, yet , in so doing, may easily lose its original contextual underpinnings that imbued it with richer nuances of meaning in the first place. This phenomenon is perhaps no more evident than in cable television, where networks and individual channels are devoted to specific content delivery 24 hours a day. The downside of course, is that information must be assimilated rapidly on the take up side by the media corporation, just as it is foisted upon the consumer with a ‘forced- feed’ pretext, to make room for the next feed. Information, through such convergent capabilities, that permit ‘bites’ of knowledge to be digitally transferred globally and instantaneously, allows knowledge to be stripped of the framework in which it emerged, just as it is quickly, yet superficially digested by the global consumer. When information held the status of being a community resource, rather than a global commodity, it could be used at the will of the consumer, for their own determined purpose, rather than the commodified purpose preselected by the respective media conglomerates that perpetuate the promulgation of endless information.

Further challenges to technological and corporate convergence trends, apart from dilution of meaning due to the multiplicity and potentially splintering of sources, according to ITU (2008) concerns, “content distribution and management, sustainability and scalability, innovation management, competitive dynamics, tariff policies, network security, regulatory coherence and consumer protection” (ITU 2008). While the broadening of avenues for content distribution has the allure of versatility, the revolutionary distribution of music in the past decade illustrates the potency of convergence, threatening to undermine the very industry it was seeking to promote. I-Tunes and other legal internet based distribution pathways for music radically altered the income and revenue streams derived from popular music providers globally. While the consumer was benefited through the open door of access to music, (just as the educational market was reconfigured once educational corporations began to exploit the potentialities of online delivery of educational content at school and university level), the demand for live music globally initially declined, yet has now been buoyed up by the benefits of enhanced global exposure, on account of the global penetration capacity of online music.

Another aspect of this link that has pressurised corporations like never before has been how to safeguard the integrity of informational, entertainment or intellectually creative products, once they are so widely available via the world wide web. The proliferation of cloned products has the tendency to diminish the quality, reputation or demand for the original. Corporations have had to weigh the benefits of more universal distribution, against this tendency to have the integrity of a product compromised. This, in one sense has been as much about re-education of the consumer, who remains driven by the desire for quality in many instances, overlooking the detracting influence of You-Tube look alike musical bands renditions of hit singles by either reputable or promising new talent.

Patently, issues of security remain paramount, in this race towards virally changing convergences, whether it is the protection of personal data by entertainment companies, the finance sector or an individual relying upon social networking websites to foster their new relationships. Banks reputation for safety once built at the store front only, to remain competitive amid their market rivals, has now shifted to the quality and integrity of their web presence. This same notion extends of course, to an ever growing margin of the retail sector, and the sporting sectors, who realise that within the 21st century era of the new media users, the ‘digital native’ populations will increasingly rely upon web based sources for their interfacing with the world. Ironically, even large scale media conglomerations recognize the technological convergence can allow the operator of a mobile phone with a camera component, to drive world changing conditions, in the event that anybody happens to be at the right place at the right time, and films an international crisis on the telephone, then posts it on the web, embarrassingly before a major news corporation has the time or the infrastructure to outrun them. This realization has brought a new sense of recognition from major news broadcasters, to the power and penetration of websites like You-Tube, creating in journalists a scrutinizing eye for such alternate culture havens to assist the construction of mainstream breaking news stories.

The future looks bright for the ongoing convergence of technologies and corporate agendas. We are reminded of the profound benefits of the digitization revolution, yielding “enormous gains in transmission speed and flexibility over earlier forms of electronic communication,” (Mosco & McKercher 2008: 38) “extending the range of opportunities to measure and monitor, package and repackage entertainment and knowledge” (Mosco & Mckercher 2008: 38).

Nonetheless, the need to balance economic welfare and human welfare continues to be of concern, and one of the many implications of the increasing reciprocity, between technological and corporate convergence. In the field of media journalism news production convergence, Klinenburg reiterates that convergence facilitates a more rapid confluence of sources impinging upon an event or a story, yet it also intensifies the pressures upon the journalists time to “conduct interviews, go out into the field, research and write” (2007: 128). The processing time available at the human level continually diminishes, and when the technical speed is permitted to eclipse the human processes of digestion of knowledge and subsequent reflection, the result may ironically, in spite of a seemingly infinitely greater number of sources, be inferior, less news worthy and more insubstantial, than in would have been if the journalist had to rely upon more traditional methods of crafting a story to be broadcast or published.

While we have such warnings of convergence being manifest as a “concentration of technological ownership, in the form of the global media conglomerates” (Saltzis 2007), occurring in tandem “at the three levels of networks, production and distribution” (Saltzis 2007), it is prudent to be cogniscent of the fact that such monopolization can create an hegemonic corporate empire, allowing such media outlets to in effect be massive funnels for particular ideological positions. Divergence of ownership, on the other hand, may be a way to democratise control and use of these powerful message delivery mechanisms, yet without inbuilt check and balance systems, the corporate stakeholder will rarely consider that their over- influence in the market place of ideas is detrimental to society.

Since convergence researchers are ambivalent about the relative degree to which the “conglomeration of the global media has been the causal factor of technical convergence, or whether it is its by-product” (Saltzis 2007), there remains much to scrutinize, as we more globally to a yet more convergent means of conducting business; as well as producing, disseminating and consuming information, for diverse purposes. Saltzis’s observations seem pertinent in the final analysis. While the “benefits of these transitions include the merging of consumer bases; the creation of synergies with shared resources (utilising economies of scope and scale); as well as cross-promotion, the instability of the global media system, with its intense competition, advertising, peer-to-peer file sharing technologies, have established significant challenges for both the music and film industries” (Saltzis 2007). The matter of e-regulation is, as Saltzis asserts, “in its infancy” (2007), with many more competing political, economic and ethical questions to consider, as the global market place continues to converge.

Bibliography

Mosco, V. & McKercher, C. (2008) The Laboring of Communication: Will Knowledge Workers of the World Unite? Rowman & Littlefield

Saltzis, K. (2007) Corporate and Technological Convergence (Lecture 8): New Media and the Wired World MS2007.

International Telecommunications Union (2008) World Telecommunications Policy Forum 2009 ‘Convergence’, accessed December 13, 2008 from http://www.itu.int/osg/csd/wtpf/wtpf2009/convergence.html

Yu, R (2008) Airlines Upgrade Entertainment in Economy Cabin USA Today retrieved from http://www.usatoday.com/travel/flights/2008-05-05-inflight-entertainment_N.htm December 13, 2008.