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MBA Students Are On Demand In Disruptive Digital Media Industry

Digital innovation in the media industry has created a new market for business schools' specialist MBA programs – and new careers for its students.

Sun Nov 2 2014

John Carey keeps a harried schedule. Not only is he a professor on a media management MBA program, one of a growing number of blockbuster-focused specialist training courses, but he consults large media corporations in his spare time.

The professor has helped clients including Google, NBC, The New York Times, A&E Television Networks and Cablevision, to name but a few, navigate the increasingly fragmented media industry as it transitions into a new digital age.

From his base at Fordham Graduate School of Business in New York, a city steeped in a rich music history from blues to hip-hop, he helps operate one of a handful of MBA programs that specialize in the rapidly evolving media business. Other courses have been rolled out in the UK, Canada and across the US.

“There is an important role for MBA programs in music and media,” says John, who teaches on the Communications and Media Management MBA.

Such has been demand for these courses in the UK that Henley Business School, a pioneer of the creative industries, has expanded its media-focused MBA into South Africa and plans to launch a third in Hong Kong in 2016.

The media industry is evolving. There is increasing M&A activity among the large legacy broadcasters, record labels are turning to new revenue in music streaming, and broadcast and cable groups face stiff competition from a host of technology companies and ups-starts including Netflix, Amazon and Apple, as consumers migrate to video content on smartphones and tablet devices.

“This is the golden age of TV. It is a most exciting time,” says Helen Gammons, director of the MBA for the Music & Creative Industries at Henley. “But… Disruption could be just around the corner and most of the broadcasters will be looking at how this evolution will pan out.”

Indeed, the US television industry is loosing advertising contracts as digital competitors start to steal market share.

Cable companies are shedding subscribers, many of whom are turning to streaming services from Netflix, Hulu and Amazon.

But Helen thinks that this innovation and disruption can be harnessed by managers with the right training, who can help companies to be ahead of the change curve.

“Sky is already experimenting in this regard. Mergers and acquisitions are likely in this sector and executives with those skills will be needed to help manage such transitions,” she says.

She adds that 100% of executive students on the flexible program find employment. “With change comes great opportunity,” says Helen.

It helps to explain why media business is booming at Henley. Inquiries are up 100%. 

Henley’s creative MBA was the first of its kind. The program, which costs £24,500, was set-up in 2012 and has grown to have a 65% increase in enrolment for its second intake.

It tailors workshops and content on the music and wider media and “creative” sectors alongside core MBA modules such as finance and marketing.

“We attract executives from across the creative industries – film, TV, music, content distribution, broadcasters, tech services [and] games,” says Helen, reeling off a few from a long list.

The UK’s creative industries are worth £71 billion a year to the UK economy, with growth of almost 10% in 2012 that outperformed all other sectors of UK industry, according to official figures from the Department for Culture, Media and Sport.

Employment in these media sectors increased by 8.6% between 2011 and 2012, a much higher rate than for the UK economy as a whole.

It is this growth in jobs that attracts MBAs to specialist media management courses, particularly in the digital world, according to Tim Holmes, who helped to develop the MBA in Media Management at Cardiff Business School.

“The field of digital, on-demand video services is a prime area of career opportunity for graduates,” he says.

The MBA, which costs up to £18,660 and is delivered in the Welsh capital, is taught jointly with the School of Journalism, Media and Cultural Studies.

As the MBA cohort is made up of global students, they see scope for the expansion and development of video streaming services around the world – particularly on mobile devices, Tim says.

He adds that it is essential for students to understand this new media landscape, which is both fragmented and converged. “Traditional channels are in competition with technology companies,” he says.

It is a similar story across the Atlantic, according to John from Fordham. “We have placed our MBAs at every major TV and cable network, as well as many startups and niche media companies,” he says.

The NYC-based business school offers both an MBA concentration in media and a master’s degree in media management.

This focus allows managers to understand the nature of disruptive change, how to manage innovation as well as spot entrepreneurial opportunities in the media industry, says Bozena Mierzejewska, assistant professor of the Communication and Media Management MBA at Fordham.

“Changes brought by technology create not only challenges for music labels but obviously create enormous opportunities for MBA graduates,” Bozena says.

But the business of music is not exactly in rude health. The big record labels such as Universal Music Group, Sony Music and Warner Music have struggled as consumers have moved online. Even with the growth of digital, global recorded music industry revenues fell 4% last year, according to the IFPI, the global music industry association.

“We have not yet had a student with a burning desire to get into the music business,” says Tim from Cardiff.

But John says the industry is still a “billion dollar business” despite shifts in where the revenue is going. He adds: “Students don't see the music industry the way people in my generation do. My generation sees decline; they see the areas of growth.”

However, the slowdown presents a problem for business schools, many of which place value in music industry learning in their specialist MBA programs.

Where there may be  more career opportunity, however, is in the technology groups feeding on the decline of the record business. Apple bought Beats Electronics earlier this year, while Google’s move into broadband fibre service is transforming it into a content distributor.

Telecoms groups are also bundling music streaming services with mobile phone subscriptions. Spotify has deals with Deutsche Telekom in Germany and Sprint in the US, while up-starts Rhapsody and Deezer have struck similar deals with telecoms groups.

At the same time, technology companies hired the most MBA graduates at a host of leading business schools last year. 

“There may be a major opportunity in big broadcast media. In music, all the streaming services are essentially making the same content offer,” says Rob Bolton, a digital marketing manager at Warner Music who lectures for the Schulich School of Business’ Arts and Media Administration MBA.

This streaming sensation is wider than the music industry. Cable companies are also shifting content online.

HBO recently announced a new standalone digital service, while online distributors such as Netflix, Amazon and YouTube are changing consumers' viewing habits.

“The demand for TV content to be streamed is definitely there,” says Rob. “An MBA [graduate] with knowledge of the industry will indeed be a valuable asset – especially for those graduates who can identify and exploit opportunities; essentially creating new jobs as opposed to looking for posted roles to fill,” he adds.

There are signs that business schools are adapting their content for the digital age. Media programs are teaching the use of big data and analytics, say program directors, which media companies use to examine market trends and to develop strategies.

Henley recently held an event with IBM – “Analytics With Attitude” – for its MBAs, while big data is also part of Cardiff’s media-focused MBA curriculum. 

Helen says data analytics is used to inform marketing campaigns. 

“The creative sectors – the music, film, TV and games arenas – are greatly benefitting already from advanced analytics, and so much more is possible,” she adds.