Time To Live In Reality: People Are Going To Copy; So Build A Better Business Model
from the indeed dept
Rose M. Welch points us to an interview with Cory Doctorow, where he discusses his decision to give away all of his books as free downloads (which, as you hopefully know, has been quite successful for him). As Rose notes, one of his quotes aptly sums up the basic position we’ve taken here at Techdirt for years:
As a practical matter, we live in the 21st century and anything anybody wants to copy they will be able to copy. If you are building a business model that says that people can only copy things with your permission, your business is going to fail because whether or not you like it, people will be able to copy your product without your permission. The question is: what are you going to do about that? Are you going call them thieves or are you going to find a way to make money from them?
This is what’s been so frustrating about this debate for so long. The focus, by many in certain industries (especially the music and movie industry), has relied so much on the “calling them thieves” part, rather than figuring out better ways to make money. Sure, if there were a way to stop unauthorized copying, that would make lives easier for those companies. But that’s a pipe dream. It’s not possible. And while it may take more work, once they stop complaining about it, and start realizing that there are ways to leverage that copying as free or cheap creation, promotion and distribution, suddenly it becomes an opportunity, rather than a threat.
Filed Under: business models, copying, copyright
Comments on “Time To Live In Reality: People Are Going To Copy; So Build A Better Business Model”
” Sure, if there were a way to stop unauthorized copying, that would make lives easier for those companies.”
Since there isnt a way to stop unauthorized copying. We can only hope they do like they are threatening to do in spain … take their marbles and go home.
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Amanda Palmer has it figured out. She’s going to release ukulele covers of Radiohead. Nobody is going to want to copy that. Problem solved without any need for draconian DRM.
Free content supports artists who will publish ukulele covers of Radiohead. If we want to continue to enjoy mainstream artists, we better all try to figure out what we’d rather pay for – something that scales – if we don’t want to pay for the content.
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facepalm indeed. i cannot think of anything (musically) she could do that would be any less appealing.
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She plays Radiohead on the ukelele half-naked. So… Yeah. It’s amazing what people will endure to see other people half-naked. That being said, aside from the ukelele thing, I adore Amanda Palmer.
Why would they want to re-work their business model? It’s not like they’re in it for the money.
Oh, wait…
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Remember when the recording industry was in it to make great music and making money came in a close second:
http://lefsetz.com/wordpress/index.php/archives/2010/05/25/ted-talk-simon-sinek/
Those who lead inspire us. We buy posters and t-shirts to show that we’re on the bandwagon, that we believe too. Who’s buying a t-shirt of the flashes in the pan? Who wants to be caught in a Tiffany t-shirt today?
Why are the major labels in business? Not to bring us the best music. Jac Holzman was on that mission, when he started Elektra. Same deal with Ahmet Ertegun at Atlantic. They loved the music, they wanted to bring great stuff to the masses. The money wasn’t first. Riches and fame came as a result of their passion.
In other words, we’ve got it assbackwards today.
The wannabes always ask…HOW CAN I GET PAID?
The major labels say…YOU’D BETTER PAY, YOU’D BETTER NOT STEAL!
And the classic acts tell us…YOU’D BETTER OVERPAY TO HEAR THE SAME SONGS AGAIN!
Huh? Where’s the appeal of that? Who’d want to associate with that?
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“Who wants to be caught in a Tiffany t-shirt today?”
I can think of at least two people:
http://www.imdb.com/title/tt1152828/
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you can find the rest of Anonymous Coward’s comments here…
http://lefsetz.com/wordpress/index.php/archives/2010/05/25/ted-talk-simon-sinek/
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I linked to it, yes.
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d’oh. I missed that, sorry.
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That’s okay! That TEDtalk is really amazing so it’s all good. Mike should post it!
i agree. the problem, though, is “figuring out better ways to make money”.
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1. Take all the money you would spend fighting a fight you can’t win
2. Use it to hire creative people
3. ????
4. Profit
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Blasphemy!
And another...
…enlightened author http://jakonrath.blogspot.com/2010/05/piracy-again.html
Re: And another...
Great article. Konrath makes some very valid and insightful points. It is in human nature to share information (that’s why we have gossip) and fighting human nature works just as well as the keeping the HD DVD encryption key from appearing all over Digg.
There is a way to stop unauthorized copying or at cut down on it least significantly. The way lies in oppressing people and exerting a whole lot of control over their lives and activities. If you are strong enough to oppress and control people sufficiently, you can stop unauthorized copying. Thats the problem. There is a way, it just doesn’t lie anywhere near democracy.
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“If you are strong enough to oppress and control people sufficiently, you can stop unauthorized copying.”
Oppression has never stopped any of the things it was intended to stop or prevent. It has only slowed them down. In the all the media creation and distribution industries the trends are already there, they are undeniable, and unstopable. The order of failure is Newpapers, Record Labels, TV Studios, Movie Studios. All of them have charts showing the trends of any past implemented disruptive technology.
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They just haven’t managed to set up the level of oppression and control that they need yet.
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“They just haven’t managed to set up the level of oppression and control that they need yet.”
It wont happen because an alternate set of systems has already been created, the creative commons and its ilk, and the new business models based music as a loss leader. As the current system becomes more oppressive, the secondary systems will gain more support causing a financial crisis that destroys the oppressive one. This is part of a study I am doing on disruptive technologies.
A really interesting point is everything the media distribution industries are doing and have done, is based on beliefs and not any sort economic theory or any real studies. They are doing everything wrong because they are not adapting to the clearly visible trends. It means their imminent failure if they do not change.
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Well, I certainly agree with you that I don’t think they don’t have the power to to pull it off. I still think it is important to understand what they are trying to do, and that if they *did* have enough power, they could do it.
It is not like we have never seen masses of people forced under unwanted control for long periods of time while their oppressors benefit from it before. I can picture “success” for them, and this is what it looks like. It doesn’t last “forever” of course, but what does?
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” I still think it is important to understand what they are trying to do, and that if they *did* have enough power, they could do it.”
I do understand what they are trying to do, protect their business intrests. Slowly, intentional or not, they are trampling the constitution of the US, and causing all sorts of unintended consequences.
In this day and age of unlimited communications, every thing they do is being blocked, worked around, made incosequential, or on the verge of being replaced by something else. Our perspectives on where this is going seem to be different, you seem to think they will succeed, I know they wont.
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They aren’t going to manage to do anything about infringement, but they are going to manage to make everyone’s lives miserable and make our laws irresponsible and harmful. I don’t agree that the fact that the laws are harmful rather than helpful doesn’t matter or should be allowed or ignored. Sure current infringers and people after entertainment won’t care, (what do they care if laws they aren’t following are more stringent). But other areas still have to take a beating. High profile legitimate companies or other entities can’t or won’t (continually) ignore the new law without risking their business. Technological advancement and economy suffers as legitimate companies try to comply with the irresponsible laws. Random people will still get hurt with their “guilty until proven innocent” crap. Other laws will be passed on this precedent that going overboard on restrictions and monitoring is ok in the name of security against non=violent crimes.
Once the new laws have been in for a while, they start pushing them on other countries, and then escalate it to whatever the next stage of more harmful laws that use these ones as a foundation, which will hurt people and companies more while probably still not affecting current infringers at all.
You know, I just don’t think it’s a good idea to let them do this stuff just because “I” don’t have to follow the law anyway.
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“They aren’t going to manage to do anything about infringement, but they are going to manage to make everyone’s lives miserable and make our laws irresponsible and harmful.”
This I agree with. A large chunk the implementation will violate sections of the constitution. Due process will go out the window. Law enforcement will be farmed out to private corporations, in this case ISP’s. Privacy will be impacted as surveillance goes up. It will also do nothing to slow down infringement as new encrypted and distributed systems come into existance.
Previously on techdirt I pointed out that, as humans, we have been sharing and spreading information for about a million years. In 1709 Queen anne signed the Statute of Anne, a law that was an attempt to change our nature through legislation. We have reached the point were this has been pushed so far as to not allow people stocking shelves in stores to sing while working, where playing a song in a public park requires a liscence, where singing happy birthday in public can get you dragged into court and sued. Not only does this violate the spirt of the copyright clause, it violates human nature.
“Once the new laws have been in for a while, they start pushing them on other countries, and then escalate it to whatever the next stage of more harmful laws that use these ones as a foundation, which will hurt people and companies more while probably still not affecting current infringers at all.”
The industries pushing for ACTA are a very small part of the global economy. There are about 50,000 people that make their living off of media sales and distribution, the other million or so are worker drones with yearly salaries. The laws they are pushing for affect everyone and every corporation on earth. In the end who do you think will prevail? The industries that are going to be dead in 10 years no matter what they do, or the people at large and the other 95 percent of GDP corporations.
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” the other 95 percent of GDP corporations.”
change to
the other corporations of the world that represent 95% of the worlds GDP.
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” In the end who do you think will prevail? The industries that are going to be dead in 10 years no matter what they do, or the people at large and the other 95 percent of GDP corporations.”
Not sure about “the end” or when that might be, but in the meantime in “the present”, they have already won over the U.S. government, and are using it to pressure other countries who have been relatively quickly buckling under pressure. It is certainly no time to be complacent and think “there is nothing to worry about”.
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“It is certainly no time to be complacent and think “there is nothing to worry about”.”
Agreed, seems we are both arguing the same point from slightly different perspectives.
Can they change...
Can authors and people that think this way change the world? Maybe not but they will spark the idea in someones mind that will bring forth the change, if people like Cory keep doing it their way we should see some change in our lifetime.
Ctrl+c & Ctrl+v
Copying is now ubiquitous. We have supercopying machines in our pockets. Copying will only get easier.
But really, good luck trying to put that genie back in the bottle, ten years after the Napster debacle.
Copyright infringement has been nipped in the bud, right? How do young people consume content? The future will not be kind to the control freaks.
Change
Things will never change with them and they will continue to make bad decision after bad decision until they are no more.
It can’t happen fast enough for me. Good riddance.
Re: Change
Things will never change with them and they will continue to make bad decision after bad decision until they are no more.
It can’t happen fast enough for me. Good riddance.
for me copying used to be about getting free shit, but that had been eclipsed by a sense of civil disobedience, of political statement (see the swedish pirate party hosting the pirate bay), and about hastening the demise of large media conglomerates.
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I second that sentiment.
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…in favor of large aggregation conglomerates.
Way to “fight the power”, idiot.
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What the fuck is an aggregation conglomerate?
Re: Re: Re:2 Change
i heard about this company called google?
Re: Re: Re:3 Change
I thought they did search? And a million other things as well.
Re: Re: Re:4 Change
And many of those “million other things” are aggregation.
The point is, you want to “hasten the demise” of the creative corporations in favor of tech corporations. This makes no sense from an anti-corporation standpoint.
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Way to “fight the power”, idiot.
i think it’s more like assisted suicide.
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“i think it’s more like assisted suicide.”
Thanks I am going to use that in the future …
Now that ACTA has passed it is time for the Record Labels, TV Studios, Movie Studios, and Pharma companies to be taken to task. Today I present you with a plan to assist in the suicide of the of the architects of ACTA …
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“Aggregation conglomerates” (as you call them) don’t try to monopolize our culture.
Examples?
What examples are there of companies that have “leverage[d] that copying as free or cheap creation, promotion and distribution”?
Re: Examples?
i heard about this company called google?
Re: Re: Examples?
AC: To clarify, I’m sure you didn’t mean that Google is giving away other peoples’ material. Because they’re not.
They do, however, embrace the open source model for their software, which has resulted in tremendous financial gains.
Re: Re: Re: Examples?
thanks- i only just noticed i was talking sh*t
Re: Re: Re: Examples?
Technicality: Yes, Google is giving away other people’s ‘material’ (in other words, ‘material created by others’).
However, and I think this is your point, the rights for said material have expired so Google is within their rights to do so.
Re: Re: Re: Examples?
Technicality: Yes, Google is giving away other people’s ‘material’ (in other words, ‘material created by others’).
However, and I think this is your point, the rights for said material have expired so Google is within their rights to do so.
Re: Examples?
Broadcast TV and radio come to mind. Thousands of separate, competing business, giving away an expensive product, 24 x 7.
Re: Re: Examples?
Perhaps there are some exceptions, but many seem to not appreciate that television and radio stations do in fact pay royalties to the rights holders in order to play their works over the airwaves. Hence, what they play is fully authorized and consistent with applicable law.
Re: Re: Re: Examples?
At what point in your question did you put in “cannot follow the law or pay for content”? TV content is free to the end user and for years the networks have made money from it. You asked for examples and got one. Changing the question after it is answered is just trolling.
Re: Examples?
What examples are there of companies that have “leverage[d] that copying as free or cheap creation, promotion and distribution”?
how about any site with user generated content like image boards?
This trend will end like Shareware.
Works fine on the front end for a few with either good products or the right breaks in publicity, but as number of products grows, even the best gets lost in a sea of choices.
That’s actually EXACTLY the “model” major studios use, of promoting a few — regardless of merit — and using the rest as a pool from which they pluck ideas and talent.
SO, while it’s working now for a few — who are actually using the publicity angle — is it going to work *in general*? Example: the Iphone arena with its 100000 choices? I think not — IN GENERAL, mind. For a FEW, yes.
Part of the problem with (some) shareware, and Iphone apps, is that they’re simply too expensive. This gets to the “too cheap to buy” versus “too expensive to buy” dilemma, for which there’d have to be a solution in the overall society, of perhaps subsiding these “producers” through an easy and painless vote system, and out of general revenues. — But of course that’s “socialism” so reactionaries will dismiss it out of hand, while moneyed interests will oppose it with literal force.
Re: This trend will end like Shareware.
Works fine on the front end for a few with either good products or the right breaks in publicity, but as number of products grows, even the best gets lost in a sea of choices.
the problem is never excessive choice. it’s always a lack of differentiation. there is no such thing as “too much choice”, unless you are lazy or uncreative. the problem is producers who cannot differentiate themselves.
one way to do that, as is stated here on techdirt all the time, is to connect with fans and give them a reason to buy. another way is to simply make stuff that people really believe in. the phenomena is described here sometimes as a “true fan”.
That’s actually EXACTLY the “model” major studios use, of promoting a few — regardless of merit — and using the rest as a pool from which they pluck ideas and talent.
that was great when selling millions of copies of “a few” things paid the bills, but it doesn’t anymore. anything with mass appeal will just get copied en mass, partly because that’s the most efficient way to get it, but also because the product is disposable, forgettable, and not really worth the price of admission.
major studios sell promotion and distribution at a markup to subsidize production. copying slashes the price of promotion and distribution, leaving little to subsidize production.
that leaves the studios with a small number of products with high production costs and shrinking avenues of subsidy. that’s a broken product. trying to sell a broken product is a broken business model.
SO, while it’s working now for a few — who are actually using the publicity angle — is it going to work *in general*? Example: the Iphone arena with its 100000 choices? I think not — IN GENERAL, mind. For a FEW, yes.
in general, the business of selling something that people can get for free, with nothing that differentiates your product from the free stuff, will not work. in general, selling something that adds value to something free, like professional support or convenience, does work.
there’d have to be a solution in the overall society, of perhaps subsiding these “producers” through an easy and painless vote system, and out of general revenues. — But of course that’s “socialism” so reactionaries will dismiss it out of hand, while moneyed interests will oppose it with literal force.
who can say no to red blooded american ingenuity? who would scoff at old fashioned capitalistic competition? who thinks that plain old small town community isn’t a good idea? who has something bad to say about creativity or customer satisfaction?
why not make something that a small group of people believe in and will pay to support? why not build a dedicated community around your product and leverage it for support, the way that churches do? why not cowboy up and do some real work instead of hiding behind lawyers, licenses, and lawsuits like a sissy?
what is funny is to see the answer to the question right on the same page of techdirt:
http://techdirt.com/articles/20100526/0020429577.shtml
basically, not very many people are enjoying reading books online. the situation is self regulating, most people wont suffer online reading for very long, and are generally much more comfortable with a good paper book. what doctorow is doing, albeit by accident, is playing off a nice combination of peoples greed to download something (anything!) for free, their inability to enjoy the product in a digital format, and that the subjects of his books appeal very specifically to those people who would download to start with. again, is his a business model, or just a lucky intersection of situations that cannot be repeated?
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Reality: http://www.spinner.ca/2010/05/27/apples-dominance-over-digital-musical-market-under-investigatio/
“Recently, the infamous tussle between the iTunes, Apple’s massive online music store, and one of the world’s biggest bands, the Beatles, came to a head with Paul McCartney claiming that the party at fault for delaying their music being made available on iTunes was record label EMI.”
That’s a great business model, right there. Way to go, EMI. Gone bankrupt yet?
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umm, nice way to ignore my post and try to redirect the discussion. what the heck are you on about mike?
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I don’t think that’s mike. It’s just not in his style.
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Which business model makes more sense in the 21st century? The one used by Cory Doctorow or the one used by EMI? Which business model uses reality as a starting point?
Cory Doctorow doesn’t seem to being going bankrupt. I blame reality.
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Not exactly relevant, but what the heck:
http://www.dilbert.com/fast/2006-11-22/ [dilbert.com]
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What was your point anyway (it’s kinda hard to read without the capitalization and paragraphs)?
That he got lucky? Somehow the stars were aligned during a full moon on a Saturday and he made much $$$?
Or are you complementing the guy on his good job?
I seriously didn’t get it…
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no it is the usual mikey stuff. he says “find a better business model”, but the story under it isnt a business model that repeats. there is nothing to learn here, except that some people do get incredibly lucky even when they make mistakes or take chances that most of us never should consider as business paths.
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I agree, business shouldn’t take chances or risks. They might accidently be innovative. Can’t have that!
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Warning: the following post contains massive doses of sarcasm; Reader discretion advised (wear a diaper).
/begin post
Yeah. Innovation and risk taking is soooo last week.
I’ve got an idea: Let’s stock up on patents and copyrights instead and just let the $$$ flow into our pocket while producing nothing relevant or innovative.
And if this fails, we run crying to the government, howling how piracy and technology is killing our business and that they should make them stop somehow. Tell them to wave a magic wand or something (while pointing out how China is doing an awesome job of filtering their internet). Also ask the government to implement an inquisition-type system for handling theft* (accusation == punishment; Who needs proof when our money is at stake?).
If all that fails and we find ourselves in the crapper, we can always ask for a bailout. I mean, we are just too big to let fail.
Man, some great business model we got here. I’m glad I thought of it all by myself. Better patent it (rushes to patent office).
*Yeah, that’s right, theft, not infringement ya freeloaders
/end post
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The bailout is an Internet tax – and it’ll first manifest in the form of premium ISP accounts that suffer less draconian enforcement measures.
The first step is to get ACTA adopted worldwide (and it’s proceeding nicely).
I reckon it’s about 50:50 between corporate possession of the Internet and copyright/patent abolition.
It all depends upon THE PEOPLE.
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Upset that someone borrowed your favorite tactic, TAM?
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Look behind you, it’s kung-fu mike! With triple staff action!
you write the exact same article over and over and over and over.
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Because it’s an important message that bears repeating.
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Like how the public domain is the rule and copyright is the exception to that rule.
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and that piracy supports terrorism.
Just because something is easy to copy doesn’t make it any less stealing if you haven’t/wouldn’t/won’t pay for it. Ease of breaking doesn’t undo a moral.
Unfortunately, as copying skyrockets, the companies panic, and jack prices for the rest of us who just wanted to legitmately pay for music and film they enjoy, so we can enjoy it. Instead I get music and video full of disclaimers and DRM that means it may or may not play on my chosen media player.
Making a mixed tape back when required 1. waiting for the song to come on the radio to record it, and 2. spending time because tapes could only be recorded at a 1:1 speed. A 4 minute song took 4 minutes to copy, atleast. Now I can download an entire album in seconds. Scaling has become a legitimate issue.
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Copyright infringement is not a moral issue. Copying: it’s in our DNA!
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Copying != theft. Back to school you go.
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You’re right, it doesn’t make it any less stealing. Since it wasn’t stealing to begin with, it can be any less stealing than it already is, correct?
I applaud your logic.
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“Unfortunately, as copying skyrockets, the companies panic, and jack prices for the rest of us who just wanted to legitmately pay for music and film they enjoy, so we can enjoy it. Instead I get music and video full of disclaimers and DRM that means it may or may not play on my chosen media player.”
Read what you wrote: the COMPANIES jack prices, inflict disclaimers and DRM that ruins the experience, no one else. It’s stupid beyond words to do such to those that pay you – your literal last line of defense – in an attempt to willfully ignore reality and apply scarce value to infinitely available goods.
Companies need to change, because humans won’t.
The constant mantra of “give infinite away and sell scarcity” has a nice appeal, but it does not necessarily translate into all industries. I have as yet to receive a response applying this mantra to software companies whose products comprise entirely utilitarian, digital content.
Of course, companies like Apple, which is in reality a hardware manufacturer, and Red Hat, which is a service provider, are at times used as examples consistent with the mantra. However, they are not representative of the software industry per se. Adobe, Corel, AutoCad, Microsoft, etc., etc. are not in the hardware business as it pertains to their flagship products.
Since this site seems to have no shortage of opinions offering some of its own ideas concerning business plans for digital content providers within the entertainment and movie industries, it only seems appropriate that examples of possible business plans also be offered. Because Adobe products are so ubiquitous, perhaps is could be used to offer some examples. I would then take such examples and extend them to those other companies who offer digital products that support and expand upon the native capabilities of Adobe products. Photoshop is one product that quickly comes to mind in that an entire sub-industry has developed for products such as plug-ins and actions.
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The constant mantra of “give infinite away and sell scarcity” has a nice appeal, but it does not necessarily translate into all industries. I have as yet to receive a response applying this mantra to software companies whose products comprise entirely utilitarian, digital content.
Odd that you say that when I have answered that question multiple times in great detail every time you bring it up.
I went through a whole series of examples of how companies, such as those that make CAD software, could leverage scarcities.
Of course, that was back when you actually posted under your name. So I guess you can pretend to be someone different and pretend I never answered your question.
However, they are not representative of the software industry per se. Adobe, Corel, AutoCad, Microsoft, etc., etc. are not in the hardware business as it pertains to their flagship products.
Again, we did detail how those sorts of companies could leverage the software into selling scarcities. You ignored it.
But, more to the point, your question is misleading. It’s like asking “but how can buggy whip makers keep selling buggy whips.” It’s the wrong question. The question is how can buggy whip makers keep making money. If selling software isn’t a good business, then you have to sell something else.
IBM figured that out a long time ago. That some other companies are slow on the ball doesn’t mean there aren’t business models.
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I respectfully disagree. I have raised the question in numerous prior posts and I have never received a reply from either you or one of your colleagues.
All I read about are examples like Red Hat, which is not even what I would call a software company in the sense that I use the term. According to your various articles in which Red Hat is discussed, each one notes that the scarcity it sells is services.
IBM is likewise inapt as an example in that it has always (at least to my knowledge) been a purveyor of hardware. Where it ran into problems was by not leading the charge as the industry transitioned from mainframes to other devices.
Thus, I believe my question is valid and remains unanswered. How would/should Adobe adapt? Should it simply merge with a hardware manufacturer, try to host online behind a paywall, etc., etc.?
I ask this question in all seriousness because I truly am trying to understand the broader implications of what the future may hold for the software industry.
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Is Adobe going bankrupt? The commercial internet has been around for 14 years and in that time Adobe has still managed to make money.
http://www.google.com/finance?q=adobe
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Of course Adobe is making money, but the points repeatedly being made here is that reliance on the sale of digital content as a product is the equivalent of a “buggy whip” that will ultimately implode.
I am merely trying to get my arms around some of the things this site believes may be viable to stave off an implosion.
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I respectfully disagree. I have raised the question in numerous prior posts and I have never received a reply from either you or one of your colleagues.
This is a blatant lie. You have raised this question two or three times, and each time I’ve taken the trouble of writing up a long reply in response.
And now you claim that we have never answered you?
All I read about are examples like Red Hat, which is not even what I would call a software company in the sense that I use the term. According to your various articles in which Red Hat is discussed, each one notes that the scarcity it sells is services.
IBM is likewise inapt as an example in that it has always (at least to my knowledge) been a purveyor of hardware. Where it ran into problems was by not leading the charge as the industry transitioned from mainframes to other devices.
No, we answered directly about how makers of CAD/CAM software. Here’s one of them: http://www.techdirt.com/articles/20080519/2320201174.shtml#c296
Please now apologize for falsely claiming we have not answered this question.
Thus, I believe my question is valid and remains unanswered. How would/should Adobe adapt? Should it simply merge with a hardware manufacturer, try to host online behind a paywall, etc., etc.?
If Adobe would like to pay us to help come up with a better business model, we’re more than willing to help. But, frankly, I see no good coming of answering you, when you’re going to pretend we did not answer you the next time you feel like falsely claiming there are no scarcities.
But, at a high level, it’s not at all difficult to think of scarcities for Adobe’s products. Since you brought up PhotoShop, spend a little time figuring out the scarcities associated with photoshop: design talent, photography expertise, graphic design work, cameras, etc.
Then, start to think about business models that would leverage free software to make those things more valuable. It’s not that hard. Despite your claim that there are no scarcities and there are no business models, there clearly are. Just because you are unable to think of them does not mean there are no business models. Only that you can’t think of any.
Re: Re: Re:2 Re:
You toss the word “lie” around as if it was popcorn. The truth be told, it really is possible for someone to make a statement in error that is not a “lie”.
In all likelihood given the contents of your then comment I did not see it, because almost certainly I would have dug deeper to flesh out what you were saying (which, admittedly, was a quick first thought as you so noted). Part of the reason I know I would have dug deeper is that I have been associated with aerospace companies who have needs for very high-end software tools, and it would be unrealistic for them to proceed as you suggested. Again, I am mindful of your disclaimer that yours was merely a quick, off-the-top-of-the-head possibility.
It is my recollection that I have asked this question before, and upon reviewing the collection of comments did not note one from you or one of your colleagues.
In the context of this post, I am not trying to get you to commit to a hard, fast answer to business plan alternatives. We both know such plans are limited only by one’s imagination. Where my frustration lies is that I am left with this nagging question as it pertains to those whose line of business is solely the preparation and dissemination of utilitarian software (as opposed to software such as games). Is it beneficial to convert the industry to a sevice provider in the form of work for hire software developers? Might such a course reduce incentives to provide software with as wide a range of utility as possible? Etc.
These are not questions that are easily answered because of the ubiquitous nature of software that effects every aspect of our daily lives; but answers to questions such as these are in my opinion important precisely because of consequences that may arise were the industry to shift from a digital to a physical model.
Re: Re: Re:3 Re:
You toss the word “lie” around as if it was popcorn. The truth be told, it really is possible for someone to make a statement in error that is not a “lie”.
Indeed. But when you repeatedly have asked this question, and I have addressed it repeatedly, at some point I have to assume the intent to make a statement in error is there, and thus, a lie. If that was not the case, I am sorry, but given how frequently it has happened, and the number of times I have had to point this out to you directly, I find it unlikely that you did not ever see my original answers.
In all likelihood given the contents of your then comment I did not see it, because almost certainly I would have dug deeper to flesh out what you were saying (which, admittedly, was a quick first thought as you so noted). Part of the reason I know I would have dug deeper is that I have been associated with aerospace companies who have needs for very high-end software tools, and it would be unrealistic for them to proceed as you suggested.
I do not understand the claim that it is unrealistic to put in place a smart business model, when the alternative is to go out of business.
Where my frustration lies is that I am left with this nagging question as it pertains to those whose line of business is solely the preparation and dissemination of utilitarian software (as opposed to software such as games). Is it beneficial to convert the industry to a sevice provider in the form of work for hire software developers? Might such a course reduce incentives to provide software with as wide a range of utility as possible? Etc.
Given that every single example of business models changing in this manner has tended to increase the overall market size, I’m curious as to why you would think it would be different in this case.
Re: Re: Re:
I’m so tired of the “horse and buggy” based analogies. they don’t fit. They’re not analogous (typically a criteria for an analogy). For the analogy to work, you need a world where everyone still wanted the buggy whips but no one wanted to pay anymore.
Clearly, that’s not what happened. But if we really want to contort something that doesn’t fit into an analogy… so be it:
If the question is “how can buggy whip makers keep making money” and the answer is “sell something else” then it’s a sad day for all those people who still want their free buggy whips.
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It isn’t no one wants to pay it is no one has to pay because there are more buggy whips then people who want them. The argument is never that people just want things for free, it is that the price they are will to pay approaches zero as the quanity approaches infinity.
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Thank-you. I’m glad somebody understands.
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It is a good analogy. People didn’t want the horse and buggy per se; they wanted to go places. People found a better way to go places, so the horse and buggy business died.
People don’t want a plastic disc, or a stack of papers; they want the content. They found a better way to get the content, so the business of publishing plastic discs and stacks of papers will die.
That way may be currently unlawful – but the law against it is unenforceable. Basing your business model on the enforcement of those laws will only lead to financial ruin.
Re: Re: Re:2 Re:
That way may be currently unlawful – but the law against it is unenforceable. Basing your business model on the enforcement of those laws will only lead to financial ruin.
well said.
Re: Re: Re: Re:
I’m so tired of the “horse and buggy” based analogies. they don’t fit. They’re not analogous (typically a criteria for an analogy). For the analogy to work, you need a world where everyone still wanted the buggy whips but no one wanted to pay anymore.
I’m sorry if the analogy was not clear to you, but it absolutely does fit.
You have to look at the actual markets: horse & buggy were the market for transportation. They wanted reasonable transportation. When automobiles came along, they represented a replacement, so business went there.
Same thing online. People want music. In the past, the record labels were the gatekeeper, and the only way to deliver music was via a physical object. But, that monopoly has gone away, and people find it easier and more convenient (not to mention cheaper) to obtain music elsewhere.
The analogy definitely fits.
If the question is “how can buggy whip makers keep making money” and the answer is “sell something else” then it’s a sad day for all those people who still want their free buggy whips.
Again, you miss the point. People weren’t buying buggy whips for buggy whips. They were buying transportation. A better solution came along.
Same thing here: people weren’t buying CDs for CDs. They were buying them for music delivery. But there’s a better solution now for music delivery.
Re: Re: Re:2 Re:
The analogy definitely fits.
It might have fit ten years ago when people were still only offering up digital product tied to physical media. But we’re long past that limited reality. It’s time to let the analogy go.
The article you wrote up top isn’t about the now dying buisness model where digital media is tied to physical product. The discussion I commented on was not about whether or not the entertainment industry should adapt by offering up non-physical options. It was about the reality of unlawful copying and businesses leveraging said reality as a marketing tool rather than treating it as a crime.
Even the Anonymous poster you were responding to specified digital content twice in his post.
So no… we’re not talking about the physicality of media. We’re talking about a reality where businesses should (arguably) allow people access to their products for free. Subsequently, the analogy of buggy whips does not work.
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You’re wrong. Buggy whip / car analogy is that both are means of transportation. Other than some hardcore antique collector, nobody wants to “get a buggy whip”, they want to get somewhere. If flying cars become the best way, ground car companies will be phased out and go out of business (probably in favor to manufacturers of jet planes or helicopters or whatever).
What you say implies that people want to get plastic discs. They don’t: they want music. The music in a CD is the same that can be copied to a hard disk. Also, it’s a change of business model: you can’t sell music like it’s some sort of limited (scarce) good. It’s not like we have to go to the music mines and get 100 tons of music ore and then process it into CDs.
If everyone owns a jetpack, taxi cabs will go out of business. They can call the jetpack owner a thief all they want, that doesn’t make them relevant (the thief is stealing our transportations!)
Re: Re: Re:2 Re:
I’ve already addressed this.
What I said in no way implies that people want to get plastic discs. The clear context of the conversation when that analogy was introduced was digital distribution and accepting unlawful copying as a fact of life. The argument advanced is that content providers need to adapt to the public demands for free media. So in this instance the “buggy” is paid content. The “car” is free content.
This has nothing to do with physical media. It has everything to do with media for sale, regardless of distribution method.
And in that context, Mike stated: “If selling software isn’t a good business, then you have to sell something else.”
Which is bad news for those who want software. Because while the demands have changed with delivery method, there is still a demand for the actual content. Which was my point. The analogy of buggy whips is flawed because people stopped wanting buggy whips. No one has stopped wanting software.
Clear enough?
Re: Re: Re:3 Re:
Yeah, crystal clear. What you’re saying is that you really really want to buy a buggy whip.
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Sure.
Re: Re: Re:5 Re:
Wouldn’t you rather buy a car?
Re: Re: Re:6 Re:
Sure.
Re: Re: Re:3 Re:
Which is bad news for those who want software. Because while the demands have changed with delivery method, there is still a demand for the actual content. Which was my point. The analogy of buggy whips is flawed because people stopped wanting buggy whips. No one has stopped wanting software.
But no one ever wanted buggy whips. They wanted transportation. That need never changed.
Now they want software. The question is do you sell software, or do you sell something else, that also comes with software. Or, better yet, do you sell something else made more valuable by having that software widely available?
Your argument that this is bad news for software simply doesn’t hold. It’s GREAT news for software and the people who want it, because those better business models make the software even cheaper — or free.
Re: Re: Re:4 Re:
“Your argument that this is bad news for software simply doesn’t hold. “
Your argument only holds water if we see a system evolve where the current volume of software for sale output can be matched with a free distribution method. And the belief that the current level of output is sustainable under these conditions is strictly one of theory. A theory I disagree with.
But now we’re solidly in the territory of opinion. And I will concede that I can’t hold up mine as definitive fact. Particularly while calling the factual nature of your own opinions under question.
Re: Re: Re:5 Re:
Why do you assume it’s only a success if volume of software for sales is maintained? The entire point is that new, more efficient models don’t require selling of the software upfront in the first place. Nor is it an idea entirely the realm of belief or theory, it’s fact.
http://www.redhat.com/
http://www.alfresco.com/
http://www.novell.com/home/
http://www.apache.org/
Re: Re: Re:6 Re:
Contextually, it should be obvious that what I am talking about is the majority of content providers shifting their buisness models while remaining economically viable, thus translating to no loss of product to the consumer. Obviously, literal sales are not required when speaking of transferring over to a free distribution method, as I specified.
Also: a handful of examples (that don’t even seem applicable) do not definitively demonstrate the viability of the buisness model for an entire industry simultaneously.
So no… we’re talking about something entirely different and it is theoretical, not factual.
Re: Re: Re:7 Re:
And how are they not applicable exactly, and how do they not represent the model isn’t sustainable for an industry? Have some more:
http://www.canonical.com/
http://www.digium.com/en/
http://www.zimbra.com/partners/
http://www.sugarcrm.com/crm/partners/sugarcrm-partners.html
Find a fair few more here as part of the “open source 50”:
http://www.thevarguy.com/the-open-source-50
Re: Re: Re:8 Re:
Did these companies start out with one buisness model then shift to another? Do we have the data of their profitability before and after? At a glance, your examples do not seem relevant because they don’t fit the scenario under discussion.
Contrary to what the Internet likes to believe, a handful of examples do not prove a rule. Your examples only serve to (arguably) support your theory. They don’t make your theory a fact.
Re: Re: Re:6 Re:
Four examples? Doesn’t bode well.
I really like his summary. Starting out from a fact and drawing a sensible conclusion without taboos and without blaming people.
“This is a blatant lie. You have raised this question two or three times, and each time I’ve taken the trouble of writing up a long reply in response.”
The person you are responding to is listed as an Anonymous user. I’ve seen you indicate a couple of times that you are able to circumvent the anonymous status and identify posters. Doesn’t that kind of undermine the purpose of anonymity?
Not that I agree with them making false claims about your response. That’s certainly not acceptable. But as someone who values their anonymity and privacy, I find it a little disconcerting that you appear to take the time to identify who posts what.
Apologies if I have misunderstood.
Re: Re:
This is Mike’s site, I’m pretty sure he has access to the server logs and all of the IP’s that post here. He doesn’t ever “name” any per se but he can see someone posting from the same IP over and over again.
So if you come to the site to make the same complaint over and over using different names or as an “Anonymous Coward” or are just trolling expect Mike to call you on it.
I’ve never seen Mike call someone out who posts as anonymous when they are actually contributing to the discussion. Just the people who come to troll under different names. You aren’t ever really anonymous on the internet, someone on every single site out there can tell what IP you are coming from. So if you really value your anonymity you might want to keep that in mind.
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I’m aware of how these things work with IP addresses – which is why I always post under the same identity (minus when I forget to fill in my name). But why bother allowing an anonymous function if you’re going to make a point publicly explaining to people that you know who they really are? And I don’t just mean in the repeat IP address sense. Mike has also made a point of telling at least one individual that he knows specifically who they work for, as seen here:
http://www.techdirt.com/articles/20070318/223401.shtml
“Now, in the spirit of joining an open discussion about these important issues, would you like to stop hiding behind your anonymous facade and admit who employs you? I won’t give it away, but your IP address is quite telling.”
I would be shocked if Mike ever actually named someone. That seems to be against his character and stated beliefs. If I thought otherwise, I wouldn’t post to this site. But this sort of public statement does seem to undermine the purpose of anonymity.
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*cough*. i would say that mike has gone out of his way more than one to try to tie a cowbell on an anonymous poster. in that regard, he has little respect for privacy, real or implied.
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He he only suggests or reveals a persons identity when they’re a known troll like you.
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This is pretty much akin to the argument a cheating spouse makes when he/she is caught. You violated my privacy so you are in the wrong. If the person wants to pretend to be multiple so he can misrepresent positions he needs to put more effort into it.
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Most CMS software can track the IP’s for all comments. He won’t know who that person is, but he will know that the comments came from the same IP address. (“IP” here means “internet protocol,” not “intellectual property.”)
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” (“IP” here means “internet protocol,” not “intellectual property.”)”
Who is that a haze of?
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Yeah. I know what an IP address is. And I know Mike has used one to identify an individuals place if employment before and I know that Mike has made said individuals status as an employee for a company related to the music industry public during a debate, despite the poster opting to remain “anonymous”.
So no… I wasn’t just talking about identifying a reoccurring IP address.
I’ve written a few nonfiction books for a very niche audience, and I gave them away on the torrent sites specifically for promotional purposes.
I’ve made a fair bit of money doing that and just leaving a donation button up on the kickback site.
Were I to ever sell physical copies, I think it would be much more profitable simply for the value-added component.
i humbly suggest but not many companies are gonna do this:
make it easier to buy content. culture went global due to youtube. my internet is your internet. we are equal in that sense. so why can’t i watch a beyonce video in singapore? why can’t i buy from the itunes america or japan store? why can’t i watch anime that americans get for free on Hulu or why can’t i get all series when i subscribe to crunchyroll?
the companies are quick to punish downloaders when we get dubious dubbing on animax asia (i still have cable mind) so i have to watch things on youtube.
even with ACTA, i don’t see them discussing ways to open markets and sell goods in foreign markets at a reasonable price. but every country wants ISPs to monitor if content is being stolen/infringed.
i am very very disappoint :(. i want to buy things but i can’t afford to import anime disks or OST cds from japan for $80 a pop. and americans get funimation, hulu, abc, crunchyroll. and they still pirate.
does not compute.
What business models do you suggest ?
You need for a start or at least a business model that allowed for the cost of creation and production of content, Movies, music, music video’s, books or whatever, and especially software.
So you’re proposed business model has to be able to pay for the creation of the works, that you claim you have a super great handle on the distribution of the media.
Ok, so what model do you propose to do that ?
How do you pay for the Brad Pitts and the big names, the expensive sets, the equipment and the production team?
You cannot use a model similar to Red Hats for several reasons, for one, it does not even come close to generating enough capitol to fund the product they support, That is Red Hat alone could not have built Linux and GNU all by themselves.
And second, the Red Hat business model is a failure, it’s been listed as one of the WORST 5 stocks in the US, and it has yet to even reach it’s original market list price.
It’s also NOT a software company, it’s an IT support company, just like the many millions of similar companies that support all manner of software systems, and applications.
So, so far, no one has come up with a viable alternative business model that actually works, and ofcourse you have not addressed as to WHY they need to change anyway.
And why would they have to change, so they would have to compete with an illegal version of their own product.
Thats why there are laws against taking things and not paying for them.
And it’s very hard to find any ways to use the expensive production of something against that something in the first place. that would lead to that movie or song not being produced in the first place.
Anyway, it’s amusing you expect them to change because you want to take advantage of them, yet are unable to come up with viable alternative models to take its place, or justify why they should should do anything different to make it easier for you to steal off them.
Sure, all the entertainers and actors could quit and go into brick laying, thats an alternative model, but it’s not what they want to do, and who are you to tell people how to run their lives or businesses ?
Re: What business models do you suggest ?
Masnick isn’t suggesting a business model. That’s up to individual companies. He’s merely pointing out a condition necessary for any succesful one.
And he’s not making the demand, the market is. Even if Masnick was pig-bitin’ mad about file sharing, it would not alter the fact that file sharing cannot be stopped, and must be accounted for in any business model.
Business model suggestions
Interesting model for musicians who actually want to spread their music. Heard of creative commons? http://www.notethrower.com offers a collaborative licensing platform for free. Licensing is a great way for artists to expand their fan base through outlets in films/games/tv. Any other out there?
terrorists will just keep killing us for our beliefs, so change our beliefs
doesn’t sound right, does it?
but that’s what your saying, people are gonna steal from you, so find another way to earn a living
how about don’t steal content, you didn’t pay for
that is the solution
Re:
Doesn’t that kind of undermine the purpose of anonymity?
Late to the party, but here’s my take on it.
You’ve come to a costume party at Mike’s place. Some of us are wearing costumes that show who we are, and some of us are not. Regardless, Mike certainly knows who’s here.