Digital is not a channel in itself; it's an interactive delivery mechanism. This is most evident in the world of TV. While traders engage in their traditional annual battle around contract rights renewal, the broadcast media owners are trying to expand their platforms into the alternative revenue streams offered by IPTV, video-on-demand and online.
Channel 4's strategy with its 4degD service is to cut out the middle man and go directly for pay-per-view revenues. It sees the personal video recording-style functionality of subscription services such as Sky+ as just a stepping stone towards pay-per-view, not a sustainable long-term business.
Television is no longer confined to traditional broadcasters either. BT Vision has just launched its ambitious broadband TV service. But does it really have much chance of achieving its target of signing up four million customers to its pay-per-view internet protocol TV service within four years?
For radio, the 2007 garden appears less rosy. Despite GCap Media's Steve Orchard's bullish assertions in this week's profile (see page 14), the commercial radio sector still has lots of issues to deal with before it can be described as healthy. Radio listening figures are going up, but many are engaging with the BBC, not the commercial sector. TV has alternative revenue streams such as sponsorship, advertiser-funded programming, premium rate telephone lines and interactive. Radio is still lagging behind in these areas - and it doesn't have an obvious subscription revenue model.
Next year's radio highlight will be the awarding of the second national digital radio multiplex licence, with bids open until the end of March 2007. But the bigger story may be how the winners of the licence are actually going to make it work as a commercial entity in practice.
Digital was the story of 2006. But the story for 2007 will be how digital evolves from hype and search into real revenue generation and how it helps traditional media platforms reshape themselves for the next interactive decade.
Steve Barrett is editor of Media Week