Monday, January 3, 2011

Is Media Industry at a Crossroads?

When investment capital floods into any industry, you can be sure it is because of expectations of major growth. Conversely, when such capital does not get deployed, you can be equally sure that investors are skeptical about outsize returns.

So it might be said that a lack of fresh investment in "Hollywood" ventures signals lack of expectations. Still, many would argue that the entertainment industry remains at a critical inflection point.

That game-changer is already here in the form of technological innovation: new media, web-based streaming and the hardware that is catching up to these virtual-era breakthroughs. But all of those developments might lead investors to conclude that fresh capital is better deployed in companies that try to harness new media, not the legacy content creators.

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