I had a few random thoughts closing out 2009. But I do not wish to look into the past. I'd prefer looking forward into 2010 and what it offers the world of digital signage and digital media. The following are some of my predictions for the year 2010.

Companies: barriers to entry will be more formidable.

Entering companies will NOT see the large margins their competitors did 18 months ago. It simply will not happen. Consequently, it will be less inviting to jump into the digital sign industry unless there is a compelling reason. I fully understand, however, this does not constitute a "barrier to entry." If you would like to learn more about barriers to entry, visit the Wikipedia article on the subject. It is quite informative. I will address only a couple of the most obvious barriers to entering into digital signage for the coming months and years ahead.

I believe the number one barrier to entry in this marketplace will be advertising--getting yourself noticed above the literally hundreds of competitors. Just take a look at our industry resource directory to see for yourself. Internet advertising (both organic, PPC, and partner lead purchase), promoting at trade shows, direct mail, strategic partnerships, and direct sales are among the best methods for product distribution in this industry. But take a look at your respective ROI for said methods and you'll be a bit shaken by the results. I could devote an entire page to advertising barriers to entry in digital signage alone, but I'll let you draw the overwhelmingly obvious conclusions to that argument yourself. One thing is for certain, industry resource companies charging monthly rates for industry "lead" generation will certainly feel the pressure from their customers to deliver worthwhile leads--not the leads from Nigeria and Turkey.

Customers: barriers to entry will continue to erode.

Because digital signage software and hardware prices continue to fall, customers are going to finally have their day in the sun. Both software as a service fees and outright purchases of software will decrease--making the small mom and pop enterprises more likely to accept enterprise-level signage technology. This is ultimately good for the industry. Why? Competition increases while prices decrease. What we lose in margins is made up for in scale and size. The increase in the scale and size will come more from the 1 to 10 screen deployments then any other sector of the industry. This is where the barrier dropping will help the most: the masses will have what they want. They will get inexpensive software with easy content creation tools for deployment to smaller networks.

Technology marriages will become more widespread.

There comes a time in the industry life cycle when innovation becomes the norm for every company. Otherwise, companies without the latest widget will be left without customers--it's that simple. Even if the technology is less than practical for 99% applications, if a customer sees they can get more feature sets from a competitor at the same or smaller price, they'll go with the competition. Moreover, vendors and developers need to have something to do within the industry. There is no end to product engineering.

Apple is a good example of a company who does not stop innovating. Their innovations not only put them ahead of the competition, but they are able to pitch the sizzle behind the steak of their technology solutions. Similarly, companies doing digital signage will need to innovate and integrate various other technologies into their platforms. Technologies such as augmented reality, artificial intelligence, audience tracking/measurement, SMS integration, screen-zone scheduling, and smartphone apps will not be needed for practicality's sake, but more for sales' sake. Mark my words, software will contain more widgets to be integrated with more applications.

The dust from the hardware/software price war will settle.

There is a massive disparity between pricing of enterprise software packages. When you can get SaaS from between $10/month and $100/month per player--there's a bit of a disconnect. Digital signage media players range from $300 to $3,500 a pop. While the functionality, features, and benefits can differ between the providing companies, the large price gaps are still unwarranted.

Of necessity, prices will come more to a middle ground. Currently, smaller companies have lower prices and lower margins. Why? Because they can afford it. Less overhead means less expense and the margins do not need to feed the families of 40 employees. The only downside is that stability is hampered by possible economic turbulence. The card deck has a less sure financial foundation. In the case of larger organizations, the margins are necessary to cover a higher cost--both for development and company management. There is a problem here though. If your prices are too high, you'll immediately scare off approximately 95% of your potential clients--producing a sales closure rate of close to zero. If your per unit margin is 800%, but you only sell 10 a month, then you're still not covering operating costs. Necessity will require a decrease in price. Nuff said.

Some large "industry leading" companies will fold.

The digital signage industry is in obvious disarray. Competition is fierce and company casualties will be high if margins cannot cover the COGS of your software/hardware--especially as prices fall and margins nearly disappear. Read the financial statements of some of the larger competitors within the industry and you will see there is no calm before the storm. It is very obvious what is going to happen. It doesn't matter how much venture money you have. If you manage to burn through it like the Nazi book burning party without getting a return, there won't be anything left in the end. In the end, the assets will have to be sold off at a fraction of the cost for development and expansion.

Company consolidation will continue to occur.

I have spent time working for a publicly-traded company within this industry. Hughes' Helius is a profitable company due in part to their product variety above and beyond digital signage. As a consequence of their profitability, they could afford to pay for expensive Google PPC campaigns, professional SEO, and partnerships with several industry portals (you know who they are). Additionally, they are owned by Hughes--a company with a vast array of salespeople and partners worldwide who help lead potential customers to the Helius product line. Concurrently, I watched my brother garner leads from digitalsignage.com. I confidently know more about industry-related leads in digital signage than anyone--hands down. I can tell you from experience, that supply outpaces demand in digital signage by a huge margin. Let me say it a different way: there is simply not enough industry interest or industry leads to feed every industry company.

Most companies in the industry are banking on the day when capital markets open back up, digital signage becomes more "household," and when leads swim in like the salmon of Capistrano. While this may eventually happen, those pushing their product with PR after PR know just as well as I do that they are simply hoping for the day of digital signage to arrive for their company whilst they eat up more and more of their hard fought for resources. I'll simply consolidate my thoughts here: everyone you see in our directory will not be there in five years.

Some small players, because of their low overhead will survive, thrive and succeed. Some of the actual industry leading companies will continue to perform installations and do very well. But there will be much more consolidation than we now recognize. The people may stay within the industry, but they will be shifted between various new organizations who'll be taking over the assets of their competitors. It's that simple.

Stick around, you may be able to get some software for a song in the months ahead.

Searches for terms relating to "digital signage" will somewhat plateau.

How many industry-types search "digital signage" in the search engines on a regular basis? I'm sure quite a few. The current 100K searches for digital signage in Google are made up of customers and competition. I'm not entirely confident what percent of that number are competitors, but it's not a small number. Competing searches for specific keywords in online marketing will remain. Digital signage companies will always try and see where they match up in Google rankings. It's only natural. Inquiries about actual solutions will grow, but not at the rate we have seen in the last three years. This is simply a prediction of what will happen. It has happened in nearly every emerging and burgeoning industry when it comes to online search. Don't believe me, then visit Google Trends.

Re-engagement with dead/cold leads will increase.

Those who've already researched in the industry, but whose projects were dropped due to issues such as "lack of funding" will begin to re-engage. While digital signage is somewhat of a luxury, it doesn't mean certain organizations do not find it necessary. I cannot tell you how many viable and possible leads have dropped off the face of the earth because the funding dried up due to the economy. In an economic downturn, digital signs are certainly not a necessary part of the marketing plan.

In many cases, the organizations we've spoken to previously have reached out to us again with requirements above and beyond what their initial inquiry entailed. Their ideas of what they want to do have expanded. They are also more informed on what the technology can do. Software companies will see similar re-engagement of previous potential clients.

Seekers of the technology will be more educated and more qualified.

You will begin to see less inquiries where customers ask why they need a media player at each display. Those types of inquiries will begin to disappear as customers will educate themselves on the product before they start asking the questions. The web is just filled with places to gain free information. Customers will find said free information and come to digital signage vendors with the necessary questions which will make the sales process much more smooth.

Perhaps one of the biggest reasons potential clients will be more educated in 2010 is because it'll already be something they've researched before. This ties back in nicely to my previous point that old potential customers from 2008 and 2009 will become the revisiting customers of 2010.

Funding and VC Pocketbooks will open.

This will be more of a general market trend, less specific to digital signage. Pocketbooks will open up in general, digital signage will be a beneficiary of the market coming out of the slumps. With the projected industry-related growth touted very high, this industry may still be a good place for venture funds to put their dough. However, much of this funding will probably be put into networks themselves. Thinking you can come in and compete with the sign software vendors is a bit ludicrous.

If you are looking to start a private or ad-based network and you need funding, there seem to always be someone who will be willing to fund such ventures. But, for those willing to take risks on funding through advertisements only, 2010 may be your comeback year. If TARP funds can be tapped, even private networks may see a comeback.

Content creation will become more of a industry necessity.

In any industry, the ongoing fees are where the money is to be made. Digital signage is no exception to this rule. 2010 will not be the only year this will take place. As the technology continues to infiltrate the masses and become implemented everywhere, the content will need continuous updates and improvements. In fact, I see a day--after the margins of hardware and software are super thin--where content, content creation, and content repositories will be where the regular monies are gleaned.

Once the technology is literally used in 95% of venues and the market is completely flooded with installations, the real regular revenue will come from content creation. Think about the Internet as a parallel example of this. Content delivery is such a simple thing. In fact, it's boring. To millions of people visit YouTube because it delivers the videos better than other video sources? Of course not. They visit because of the amount, variety, and quality of the content offered. Such will be the case with digital signs. Content will not only be king, but it will be the queen, the duke, and the jester all rolled into one.

Digital menu boards will begin to see an explosion.

We are receiving many more inquiries regarding the need for digital menu boards. This is one niche that I see becoming huge. It will almost be a necessity going forward for competing restaurants to have digital signage installed as their digital menus. When the likes of McDonald's get on board, it will certainly require other fast food companies to follow suit. Just in my own personal bubble, I have seen many more restaurants begin to install menus that are digital. In the last two months, I can count four restaurants which I have been to that have installed digital to replace their static back-lit signs. The possible expansion here is nearly exponential.

Digital signage will become more of a household name.

With more inserts being placed into USA Today and industry-leading companies pushing the envelope of direct sales and push advertising, we will certainly start to receive less inquisitive looks when we describe what it is we do. 2010 will certainly not be the year that the industry catches up to the hype--not by a long shot, but we will see a maturation take place in 2010 which will be fueled in part to a emerging economy, lower prices, and a larger industry. It may not be too much to say 2010 is so bright, we've got to wear shades.

Three panel templates for digital signage displays may be dying a slow, but silent death. For decades, the three panel layout has been a fair standard for all types and forms of installation. Below you will find several reasons why the standard three-panel digital sign content template may be dying off as the industry continues to evolve.

Display Mounting Strategies Have Changed

In the most simple of terms, displays are being mounted in non-traditional ways. Increasingly, signage network installers have having requests to install their signs in portrait mode. The landscape installs of the past will still be the standard, but quickly we are seeing the landscape change (pun intended). Displays are not only going vertical, but they are also being mounted horizontal and even in the shape of a Christmas tree. While display mounting strategies become more unique and creative, so will the content. My personal thought is that creativity (in content and installation) will be one of our greatest allies for making a meaningful impact. I love the quote by Rollo May:

Creativity arises out of the tension between spontaneity and limitations, the latter (like the river banks) forcing the spontaneity into the various forms which are essential to the work of art or poem.

Displays Devices Have and Will Change

Will the standard 16:9 LCD be the digital signage standard of the future? I highly doubt it. Signs will increasingly become more prevalent and small. With the decrease in the size of the average display, the next natural evolution will be the elimination of RSS feeds and sidebars. In similar fashion, projectors, including rear-projection, are increasingly finding their place in the industry as store-fronts are using their windows for product promotion.

While display devices change, so must the three-panel content follow suit. A three panel layout on a rear projection seems somewhat ridiculous for in-window display. It also would be completely out of form to be had on a small form-factor display at a mercantile checkout.

We haven't even mentioned 360 degree displays, 3D LCDs, LEDs, OLEDs, or holographic technology. While these fall far outside the range of traditional digital signage, they do still fall within the curve and will certainly require a shift in the way content is displayed. Certainly, three-panel templates would not work in any of the aforementioned scenarios.

Out-of-Home Audiences are On-the-Move

Much like the ever-famous scene in Minority Report with Tom Cruise, we know that many sign displays are mounted in areas where people are moving.

Consequently, moving audiences have significantly less time to grasp the message on the display. When you only have between one and five seconds to say what needs to be said, do you fill the screen with a sidebar and a RSS crawler? If you do, you're probably an half-insane.

I used to live in Las Vegas and it would always make me laugh when I would drive by one of the literally hundreds of billboards that litter that city and see two or three long sentences of writing on them. Even if I were not in advertising, I would know that was not a good idea. First, I'm driving, which means my attention to a billboard is not full. Second, I'm driving past quickly at 75 MPH which means the time I have to view is going to be seconds. It was always quite entertaining when the outdoor billboard would read something like:

"Injured? Law Practices of Smith, Smith, and Smith. We have been providing professional legal advice to the Las Vegas area since 1974. Come in for a free consultation today. WWW.lawyerURL.com. 444 Tropicana AVE. Las Vegas, NV blah blah blah 555.555.5555"

As small form-factor digital signage becomes more prevalent, it will increasingly be installed in areas of high traffic. But as the term "high traffic" so readily implies: the audience is moving. Meaning the messages not only have to be short, they have to be painfully simple. Mucking up the display with more than one frame can ensure your message is lost in a grip-load of buzz and noise.

Software Capability Improvements

Dynamic digital signage content is what makes or breaks any deployment--quite literally. The clunky, standard, main window and side playlist of yesteryear is quickly disappearing. It is being replaced by a more pop, whiz, bang version of itself. Flash, Silverlight, and Apple Quartz are changing the ways content is being viewed--on all types of digital media. I really like some of the functionality given by Apple Quartz. From their website:

Quartz is a powerful graphics system which forms the foundation of the imaging model for Mac OS X. Quartz offers a sophisticated two-dimensional drawing engine and an advanced windowing environment. Quartz's feature-rich drawing engine leverages the Portable Document Format (PDF) drawing model and offers Mac OS X applications professional-strength drawing functionality. Quartz's windowing services provide low-level functionality like window buffering, event handling/dispatch as well as dynamically creating the translucency and drop shadow effects found in the Aqua user interface.

The Dwindling Effectiveness of Noise

Studies have shown that banner advertising effectiveness online has significantly decreased over the years. Additionally, the more educated the audience, the less likely they are to click on a banner ad--especially on consumer-driven websites. Similarly, increasing the noise on a digital sign display can significantly decrease the effectiveness of not only your main panel, but also your sidebar and crawler. Too much can be too much. As generations become more media savvy, they also are learning to more quickly filter that which they want from that which they do not want.

When you visit a website, you generally consume what you are looking for, while ignoring everything else. The same goes for digital media displays. If some static image were being displayed in the sidebar while some very interesting, dynamic content was playin' through the main playlist window, you--as a content consumer--may readily ignore the sidebar content--much like they would when visiting the "online" version.

In summary, unless you are using a hyper-captive audience, the standard three-panel sign layout may be hurting your signs' effect. And, as viewing habits for out-of-home change overtime, those wishing to make a favorable impact on a the content consumer, will need to get creative and move far away from the traditions of signage from the 1990's.

We often hear the term "solution" used in conjunction with "digital signage." But when are we limited? Where does the hype fall disappointingly short? When can the asset become a veritable liability. Let's examine this phenomenon by taking a look at a few of the things digital signage is incapable of doing.

1. Substitute for a marketing strategy.

I think this is an example of the age-old adage of strategy vs. tactics. Strategy takes a look at the entire forest and not the trees. Strategy is the big picture. Tactics, on the other hand, can be outdated. Yesterday's marketing strategies will not win today's media battle amidst the fragmented market. Contrastingly, yesterday's strategies, coupled with today's tactics can create a powder-keg mix for implementing something really successful.

This marketing mix will most definitely include the web, mobile marketing, print (yes, including printed signs), direct mail, broadcast television, and direct sales. Unlike the original three marketing methods of 1950 (ABC, NBC, and CBS), we've now got a lot more choices. And, of necessity strategy requires we use multiple tactical maneuvers for any marketing mix.

2. Be a success without C-level champs.

Top level management has to want to change. Generally this means, they need to become the evangelist for the project. If you can convert them to the signage way of thinking, then half of the battle is already won.

To convince, numbers are needed. Pilots and surveys are one of the best ways to ensure this. With c-level champs, success is inevitable. Without them, you're toast.

3. Be viewed with an "implement it and drop it" attitude.

Some treat digital media networks with a "squat and leave it" approach. This is a sure-fire way for your network to fail and fail miserably. Network management requires just that: regular and routine check-ups and content refresh. Oooh, I simply cannot say enough about content refresh for your digital signage.

Content is one of the biggest recurring costs of your digital network. If not, then you may want to reevaluate your SaaS fees. There are two major reasons for refreshed content. First, you need content to change for external visitors--things/events change and your content should follow suit. Secondly, avoiding "clerk-burn" by continuous content refresh is crucial.

In short, installing and walking away from you network is like buying a Ferrari and then never really taking it out for a drive. While Ferraris are fun to look at, you usually want to share you new acquisition with the crowds around you. And, if not stupid, you'll want to use it for all it's functionality and glory.

4. Produce an indisputable return immediately.

Investments--which is what media networks are--can often take time before a reasonable return is recognized. This may take some time and use of resources for testing. Pilots and a testing phase are often a welcome way to "test the waters" so to speak. Also, if you're simply looking for a cash return on your investment, then focusing on the numbers means patience is absolutely necessary. In that case,

Sometimes the best results from a digital sign network are produced over time through the ambiance and message you wish to disseminate. For non monetary measurement or a return on message, please see MediaTile's report on the subject.

5. Be done "in-house" or "home grown" effectively.

While many IT managers and junkies say to themselves, "self! I can put together a content distribution system for content delivery." Of course you can, but what else is on your plate? How many resources do you already have responsibility over? If the answer to the forgoing questions results in the realization that time will be a major issue, or if you're being pulled from your core competency on to a project which should involve a team of consulting experts, it may be best not to "roll your own."

I have had several conversations with individuals whose strategy is "roll yer own." The conversation usually includes something like this, "yeah, we've got our own system. It's pretty buggy and spots on the display jump in and out." I've spoken earlier about reinventing the wheel, but doing so with the wrong tools and the wrong workmen can create a hodge-podge mess that will require some major clean-up.

6. Be expected to act as the bottom line's "quick fix."

In bear markets, alternative channels for brand promo are sought. Often cheaper methods, while not always the most healthy for long term success, are lauded the most. However, expecting to have your digital media network perform as a "quick fix" for a failed marketing strategy is quite ridiculous. When desperate times call for desperate measures, don't expect desperation to lead to a despotic digital divide between you and your derelict "dark horses"--especially during a depression (sometimes I get bored and need some alliteration to spruce things up).

7. Be done successfully on a minuscule budget.

Does this video remind you of any of the clients you have worked with in the past:

While digital signage prices have decreased substantially, maintaining an effective network costs time, money, or both. Even putting signage hardware and software aside, one must realize that content itself is difficult to come by at times. And content is about cost; it's about your time or someone else's. The web is a good example of this. Creating unique content on takes effort. Effort takes money. And, much like the video, people are annoyed when you try and get things for free. A quote by Jack Handey comes to mind:

I can't stand cheap people. It makes me real mad when someone says something like: Hey, when are you going to pay me that $100 you owe me? or: Do you have that $50 you borrowed? Man, quit being so cheap!

8. Guarantee influence and sales spikes.

To provide real value and influence, your signs must stand out. And, even when they do, they are still likely to go unnoticed. This could be for a number of reasons: screen placement, type of venue, length of content loop etc. Sometimes influence--even the type of influence we are speaking of here--is measured in more ethereal and subjective terms. Niccolo Machiavelli stated:

"For the great majority of mankind are satisfied with appearance, as though they were realities and are often more influenced by the things that seem than by those that are."

9. Be done effectively by those who do not understand what they are doing.

Just like you would never climb K2 without a Sherpa guide, you would also never wish to implement a digital sign without the help of a sign Sherpa! Someone who has braved the pass previously and knows the nuances which treacheries of each false summit can help take you to the destination with ease.

Time and resources are wasted when inexperience replaces prudence. But, you may come to realize the following:

"There are no failures--just experiences and your reactions to them." --Tom Krause

10. Replace PR. When you work on content creation, whether online or out-of-home, quality is the name of the game. But even digital signage cannot be a full replacement for good public relations. Certainly, it can ad to the overall mixture, but it will not replace it--no way no how. Your signs could be like that tree that falls in the forest, but no one was around to see it or hear it.

Digital signs represent a simple tool in the marketer's toolbox. They do not represent the "cure-all" that some would have them out to be. However, they can provide added benefit for nearly any setting when the pieces fit together just right.

Much of this has been adapted from the Adage Article: Ten Things Social Media Can't Do.

I believe it has been wisely noted that genius is partly attributed to the ability to relate two seemingly unrelated objects. If such a definition holds true, I'm a self proclaimed genius! Today we're going to be relating undies and search engines; after which I will be coming full circle and tying digital signage into the picture.

What do whitey tighties and Google have in common?

Perhaps they are similar in that Google's homepage and "whitey" tighties are both white. Or maybe sometimes you inadvertently stumble across something you weren't looking for. Woof!

I can think of at least one way in which the two are polar opposites: one you use to find what you want, the other you use to conceal what you hope not to reveal. I'm sure there is a litany of other comparisons one could make between the search giant and a pair of tharantharuns (picked up that interesting vernacular from Urban Dictionary).

My weighty comparison of these diametrically opposed objects would reveal that simplicity is where they coalesce. Think about it for a moment. What is more simple than a pair of whitey tighties? In the technology and Internet world is there anything more simple than Google?

Simplicity of Function

Let's talk functionality when it comes to the skivies. Choosing underwear can be quite the ordeal. Think for a moment about the sometimes overwhelming array of choices, all of which are meant to perform the same function, but which complicate a very simple task. In the case of underpants, in most cases they do not need pizzaz or "pop" unless others need to see them (in that case, you're probably not purchasing them for functionality anyway).

Similarly, Google--in my humble opinion--would hurt themselves if they, like Yahoo, were to place all sorts of links and text on their homepage. Of course, Google does solicit to a sexier look with iGoogle apps and widgets, but on the surface, simplicity reigns. And, when searches are performed--which is what Google does best--all we still see is a nice logo and a search box.

Simplicity of Form

When I think of design, nothing appeals to me more than Google. No matter how long they are a company and no matter how many more cool free widgets and apps they develop, their core competency remains nearly un-morphed, at least in design and form. Google strictly adheres to the K.I.S.S. mantra of "keep it simple stupid." Google.com is the same it was when I started using it to search as a junior high student.

Much like Google, a pair of white briefs elicit the same response. How long have these things been around? 80 years? Longer? Has Fruit-of-the-Loom changed the simple design of their "biggest athletic supporter"? No! They have remained, like Google, simple in their outer design. I really do not wish to "take a peak under the hood" of either object we are now comparing :) Surface and design comparisons are sufficient for me.

How do we relate digital signage?

Simplicity, simplicity, simplicity. Gone are the days of three-panel layouts, RSS tickers/crawlers, and flashy side-panels. Gone are the days of filling the screen with nothing but utterly superfluous content for content's sake.

When it comes to content management, content creation, and content deployment for digital signs, simple and easy will continue to reign as well. As signage technology is introduced to more than IT managers and designers, simple tools will need to target the end-users who will often include secretaries, assistants, HR reps, and office managers.

So, it is utterly ridiculous to add functionality to your software or more content to your screen if it makes the management or the viewing ability more complex. If you are going to add something, make sure it increases usability and simplicity. Otherwise, you can throw that idea out with your old encrusted pair of undies.