Partner Voices: Aggregion Sets Out to Revolutionize the Digital Distribution Market
The publishing industry is increasingly being confronted by new formats, platforms, and business models, with the result that digital rights management is once again coming to the fore in the battle to retain control over content, especially keeping track of it across the myriad distribution channels now available.
Experts believe that in 2018 the world’s digital content (audio, video, games and e-publishing) market will reach almost USD 120 billion annually. E-publishing will have grown the most in percentage terms – by 68%.
That the center of gravity in the content market tends to shift toward digital formats is explained by the proliferation of the Internet, a growing number of mobile devices and, as a consequence, changing consumer preferences. As of right now, over a half of all users access the Internet from mobile devices. They all want to be able to access online content anytime, from anywhere.
Changing markets call for the preeminent role of content distribution under new conditions. On the one hand, users need to get convenient access to digital content; on the other, copyrights must be protected, and licensed content must be securely stored and delivered from copyright holders to end users.
The very same technologies that changed the content market are also changing the world, creating still more growth opportunities for the digital content market. These are all cloud-based solutions that reduce costs and improve the efficiency of all businesses across the board. They are highly scalable and help make sure that changing business objectives and market demands receive a timely and efficient response.
One solution that has been developed to tackle the issue comes from Aggregion, a cloud-based multilingual platform which allows publishers to manage content distribution networks. The solution’s unique USP is that it allows to license digital content of any type across all distribution pipelines and formats, including interactive media, and allows the rights holders to trace each content copy all the way through the distribution channel.
The Aggregion platform also adjusts to publishers and distributors’ current sales models, with its ready-made solutions designed to be able to be integrated into existing sales channels. Yet keeping traditional sales channels intact and functioning properly is not the company’s only aim – far from it.
Indeed, it is the burgeoning number of new digital sales channels that makes Aggregion well placed to respond to the needs of modern publishers and content rights holders. The company partners with hardware & software developers, mobile operators and internet providers, all in a bid to create new channels for content as well as to pioneer innovative digital opportunities.
With offices in London and Moscow, What’s New In Publishing met up with CEO and founder Nukri Basharuli to discover more about Aggregion’s plans to, in his own words, ‘revolutionize’ the way publishers protect and distribute content.
What’s so innovative about the solution?
Nukri Basharuli: Digital content licensing has been a “pain in the neck” for copyright holders ever since such content came about. Aggregion solves this problem by making off-the-shelf tools available, as well as by using a unique Aggregion DLM module developed specifically for the purpose. They securely protect content from unauthorized access, are extremely flexible and may be used to enforce any licensing policy requirement.
We are able to license and protect each individual copy of content or access to any online resource and track it in the distribution pipeline -- something which has never been done before. Most publishers are limited in their ability to protect audio and video but now they can solve this and protect every type of interactive content.
Licensing management through Aggregion helps you make your content available to the maximum number of legal users. Some want to get complete and permanent access to content – such as being able to watch a movie at any time, anywhere, with the best possible picture quality, making as many pauses as they like. Others would settle for watching it once, and then deleting the file from their PC or mobile device altogether. The licensing model Aggregion offers allows for setting licensing parameters in a very flexible manner. By offering each customer content access terms that suit him or her best, copyright holders stand to attract very different audiences with their own, distinctly different interests.
Copyright holders get to decide for themselves on what terms they are willing to provide access to their content or how to put licensing packages together. In fact, they can experiment any way they wish with any licensing parameters whatsoever. Our job here is to help them do that in the most trouble-free, convenient and efficient manner possible.
Could you explain how it works?
Nukri Basharuli: We use the SaaS model (software as a service) whereby our solution is centrally hosted. Distributors connect to the Aggregion platform and sign content license and distribution agreements with publishers.
The distributors can then use our platform to manage their distribution network: sales, prices, sublicensing politics, online stores etc. The content is tracked and the distributors get all the data on the sold content. In fact, all the data on sales can be easily accessed through the distributor’s account.
What are your designated licensing rules?
Nukri Basharuli: The license parameters are regulated and set out by the publishers.
WNIP: And the costs?
Nukri Basharuli: It is currently free to use. We only charge publishers if they are going to be selling content directly to the end user, using a fixed price per copy or a small percentage. The pricing is very competitive because we want to make Aggregion a worldwide story -- the solution is so unique we feel it can transform the entire DRM and DLM landscape and digital distribution market. We’re trying to change publishers’ way of thinking and their mentality around the entire issue.
In fact we feel this is going to change the whole world of content distribution. There are so many different channels and touchpoints that keeping track and protecting content is more vital than ever. There are hundreds of methods of content distribution -- which are multiplying daily -- and the need for publishers to protect and, importantly, control their content has never been greater.
Indeed, all of this sounds very promising. Yet, we would still like to get your take on why you believe Aggregion will be successful in the market?
Nukri Basharuli: We have taken great care to study the market and are fully aware that copyright holders have their own solutions for distributing digital content. Additionally, they are free to use a number of other third party applications available. They could also enter into direct agreements with producers of other types of digital content or manufacturers of other goods and thus create their own proprietary sales channels. However, such channels are not integrated and could not be duplicated. On the other hand, Aggregion's smart platform that uses modern cloud technology offers a unique, previously unseen solution that allows one to put a distribution network together Lego-like, using an almost infinite number of available options. Such a modular approach greatly expands opportunities for creating new sales channels and arrangements, giving rise to complex, multidimensional structures.
The essence of Aggregion's innovative strategy is in, first, incorporating traditional distributors into the digital content distribution system, and, second, creating new distribution venues by engaging with new partners and resellers of every stripe and color, thus creating distribution chains of any length required for copyright holders to reach the end users of their content.
Integrating with Aggregion offers copyright holders a host of new opportunities, such as various arrangements with mobile equipment vendors for including bundled content (music albums, games, access to educational materials installed on servers purchased by educational institutions, etc.) in package deals offered to end users or subscribers. Quite often, copyright holders connected to Aggregion find themselves in position to sell content even through venues they would never have thought of before – say, selling collectible jazz records through online stores integrated into an online jazz aficionado community or targeted developmental content through forums for parents of special needs children. Aggregion also creates totally new sales opportunities, bundling physical goods with digital content, such as, for example, when offering champagne bottles together with tickets to a romantic movie.
Yet another important feature of our system is that it generates reports automatically, and they cannot be tampered with or deleted. They are guaranteed to be accurate, excluding the very possibility of errors or abuse. Since Aggregion collects data in real time, reports are available on demand at any point in time.
At the moment, the platform generates seven different reports: Catalog Sales, Sales By Reseller, Distribution Paths, Reseller Details, Resellers by Location, Reseller Rating and Customer Details. Over time, new reports will be added to address additional needs our partners may have.
Large volumes of different statistical data presented in the reports offer a valuable tool for marketing analysis, sales management and planning. Analyzing this data, copyright holders can make informed decisions based not only on traditional general financial metrics but also on specific indicators measuring effectiveness of their channel partners, local market conditions and end user preferences.
Additionally, our technology supports distribution of content of any type – online websites, offline content and applications, etc. Just as MasterCard and Visa process payments in any national currency, Aggregion supports content transactions along the entire distribution chain, from the copyright holder to the end user, across any and all digital distribution channels. We also back this process up with maintenance and support that is available 24/7. We literally work round the clock across every time zone.
That is all nice and good, but how certain are you that your cloud platform is effectively protected from unauthorized access?
Nukri Basharuli: It is a well-known fact that not even government information systems could be guaranteed against intrusion. Naturally, Aggregion's platform could become a target for hacker attacks, and some of those could even be successful. The key advantage offered by Aggregion is that our platform is capable of tracking every license along the entire length of the distribution chain, from the copyright holder to the end user. The system automatically generates reports on content movement, these reports are available to copyright holders online, and should any copyright violations be detected, we could take immediate measures to respond.
And here is yet another important factor. Legislators world over have made quite some effort to push the pirates out of the market. Counterfeit software on the net is being taken down, and copyright violators are subjected to large fines. As a result, opportunities for seeing a new movie, downloading a new music album or reading a new digital book without paying are getting more and more scarce every day. What is even more important is that in today’s society people are quite ready to pay for proper service and pay even more for additional selection and convenience. Digital market experts all agree on one thing: the ball is now in the users’ court.
Aggregion, which supports distribution of any kind of digital content whatsoever, offers a new model for copyright holders, resellers and end users of digital content to work together to help stimulate user motivation to use paid services.
What are the origins of your company?
Nukri Basharuli: The Aggregion project was started four years ago in UK. It was first piloted in Russia as a new distribution channel for educational interactive content. Basically, Aggregion initially pioneered the technology through its distribution of interactive textbooks to Russian schools. We have since taken this much further forward and our current solution has vastly enhanced functionality and features.
I must stress that Aggregion is a completely separate and independent company -- we are registered in the UK with data centers located in England and Ireland. It belongs to a group of private investors experienced in rolling out international projects in the sphere of IT and digital content distribution.
What is your own personal background?
Nukri Basharuli: I am a PhD in nuclear physics by background but the challenges of developing software solutions to solve complex business issues proved too much to resist.
The issues surrounding content protection and licensing attracted me and I started to research the market thoroughly. My research showed that the issues of content protection and retaining control over its distribution were (and still are) uppermost in publishers’ minds.
It also meant that any new software solution had to be incredibly robust and cover every possible distribution channel and format. The challenge to find a balance between all these factors was too great to resist, especially for a nuclear physicist used to solving complex problems.
How was the solution received in Russia?
Nukri Basharuli: We rolled out the first version of our software and within six months many of the top Russian publishers had signed up as well as global publishers like Pearson and Hueber. We were also invited to partner with Intel, Microsoft, Hewlett Packard and Samsung. The need to be able to protect content has never been greater for both publishers and distributors alike.
A similar project is already operating in Russia in cooperation with the leading Russian online school platform, dnevnik.ru The breadth of the project's audience speaks for itself: every other Russian school is connected to that platform that serves over 600 thousand teachers and some 6 million students. Aggregion offers schools, teachers and students access to educational digital content from the world's leading publishers. By September 2015, it had become clear that the market is definitely interested: over 10 thousand public schools used 13 million licenses between them.
At the moment, Aggregion and Intel are discussing a project to offer schools an effective solution that includes the use of Intel-based servers and access to content via a digital library system hooked up to the Aggregion platform.
The first to test the efficacy of this solution will be the digital library of the O.E. Kutafin Moscow State University of Law, one of Russia's largest institutions of higher learning. The school's library will be connected to Aggregion and benefit from a number of advantages, such as a single access point for content on campus and beyond, convenient catalog search, potential integration with the library systems of its own branches and other partner schools and content access control across the entire user base.
At the same time, we are also working to create a single point of online and offline access to content owned by foreign publishers for the All-Russian State Foreign Literature Library (VGBIL) and its associated special and general purpose public libraries, of which there are over 40 thousand nationwide and whose combined readership amounts to over 12 million registered users.
The new distribution model has boosted the total volume of transferred data to four petabytes with this figure increasing all the time. Over a short period of time, Aggregion has become the world's largest venture in the mass distribution of content.
So, it’s been a success in Russia and we’re now in the process of rolling it out worldwide. It is a unique solution that we feel has the potential to revolutionize digital rights management and the digital distribution market in general.
How can publishers get in touch with you?
Nukri Basharuli: Our UK number is 0203 637 4247 and our email is firstname.lastname@example.org. The website can be accessed at www.aggregion.com
Thank you for your time.