Posts Tagged ‘Free’

Nine Inch Nails Case Study

February 5, 2009

Last year the name Nine Inch Nails or Trent Reznor was mentioned a lot, when someone was talking about the future of music marketing. Trent has developed a complete new way for music marketing using the whole potential of web 2.0.
He demonstrated on how many ways you can connect with fans and how you still can give your fans a reason to buy in the digital age. There is more than MySpace, there is more than just giving your songs away for free in hope the audience comes to your live shows.
Mike Masnick was summarizing the NIN Campaign in his presentation given to MidemNet this year.

Predicting the Digital Age 14 Years Ago

October 27, 2008

esther_dyson

Yesterday I read an amazing WIRED article! Well…  great magazine…. but this one was from 1995. Remember how computers and mobile phones looked in 1995?
The article is about a new way of looking at compensation for owners and creators in the net-based economy. The author, Esther Dyson, predicted in her article all the problems the media industry will be confronted with in more than ten years time cause of digitalisation. She wrote about all the challenges for owners, creators, sellers and users of intellectual property. About the fact that quality content will be free, easy to copy but hard to find. And she made suggestions how content creators can find ways to be paid. The article could have been written last year … and still it would be a great one.

I had never heard about this article before… (sure, I had heard about Esther)
It`s quite a long article … I just wanted to quote a few of the best parts:

“In a new environment, such as the gravity field of the moon, laws of physics play out differently. On the Net, there is an equivalent change in “gravity” brought about by the ease of information transfer. We are entering a new economic environment – as different as the moon is from the earth – where a new set of physical rules will govern what intellectual property means, how opportunities are created from it, who prospers, and who loses.
Chief among the new rules is that “content is free.” While not all content will be free, the new economic dynamic will operate as if it were. In the world of the Net, content (including software) will serve as advertising for services such as support, aggregation, filtering, assembly and integration of content modules, or training of customers in their use.”

(…)

“I am not saying that content is worthless, or that you will always get it for free. Content providers should manage their businesses as if it were free, and then figure out how to set up relationships or develop ancillary products and services that cover the costs of developing content. (…) The way to become a leading content provider may be to start by giving your content away. This “generosity” isn’t a moral decision: it’s a business strategy.”

(…)

“The definition of the problem, rather than its solution, will be the scarce resource in the future.”

(…)

Owning the intellectual property is like owning land: you need to keep investing in it again and again to get a payoff; you can’t simply sit back and collect rent. To some, this state of affairs may seem unfair. It certainly is if you grew up by the old rules and don’t want to play in a new game. But if you look at the new rules by themselves, they have a certain moral grounding: people will be rewarded for personal effort – process and services – rather than for mere ownership of assets.”

(…)

“So, what happens in a world where software is basically free? Successful companies are adopting business models in which they are rewarded for services rather than for code. Developers who create software are rewarded for showing users how to use it, for installing systems, for developing customer-specific applications. The real value created by most software companies lies in their distribution networks, trained user bases, and brand names – not in their code.”

(…)

“With the means of production growing cheaper and easier because of the Net, a bifurcation will take place: more and more people will produce material for smaller audiences of their friends, while those seeking large audiences will give their stuff away or seek payment from a sponsor – and try to persuade influencers to recommend it.
In the end, the only unfungible, unreplicable value in the new economy will be people’s presence, time, and attention; to sell that presence, time, and attention out-side their own community, creators will have to give away content for free.”

This was all written 13 years ago!!!

The Free World

October 7, 2008


Universal McCann publishes every month a small “brief for executives” titled “Trend Marker”. In July they had the theme “Welcome to the “Free” World”. It`s 12 pages long and summarizes some interesting facts about this new “culture of free access”. It shows why this “Free Culture” exists, what the business models are and has some case studies of brands, who already navigate the “free world”.

The paper is just a short overview, and it claims not to cover the theme completely … I`m looking forward to Chris Anderson`s new book for that… but it summarizes some points of this area quite good.

Music Access as Product Bundle

September 24, 2008

Sony Ericsson announced today more details to their new unlimited mobile music service. PlayNow Plus will launch in Sweden by the end of the year and will be available globally next year. Reuters reports, the service will cost 99 Swedish crowns (US $15.24) a month. Subscribers can download an unlimited number of tracks to the handset or to a PC. The handset will sync with the PC using broadband and 3G/HSDPA connectivity.

So here we go. After Nokia, Sony Ericsson is now the second big player in the game. We are just waiting on the iPod subscription bundle and then the transition is officially started. We are on the way to the “music age of access”.

Subscription services didn`t get a huge success on their own yet (like Rhapsody and Napster). But maybe they can find success with a device bundle. Of course there is the second big business model “Free”  with ad supported versions like Last.Fm or MySpace Music and there will always be the illegal “darknet” p2p version of music download, but getting your adored “high end” device subsidized is a big lure for many people to make a subscription contract. I´m sure there will be some devices exclusive with the subscription bundle comparable to the iPhone & mobile provider deals at the moment. If you`ve signed a contract and the music service is great, you wouldn`t want to loose it, because it`s “so convenient”. And most important, the service will “feel like it`s free” after a while.  At the moment, the price per month is still a little bit high, but when the price falls to 5 or 7 Dollars per month, many people really won´t care about this addition to their monthly mobile/internet bill.
And at this point there always comes the obligatory question: Do you know how much money you spend for water usage at home every month? Did you ever care about water costs standing under the shower?

DRM Free – Finally

September 16, 2008


Music provider 7Digital announced today that 100% of it’s 4 million strong catalogue is DRM free MP3 format. After years of talking about DRM issues, now one after another big player gets it… and we are finally there.

Apple is still “waiting” … Mark Mulligan has good comment on that:

“Often what happens when a single company dominates a marketplace it eventually falls foul of complacency and finds itself under multi-directional attack from niche innovators. Apple’s dominance of digital music is comparable to that of Google’s footprint: it continues to augment its dominance through innovation and weak competitive threat. Most other digital music providers have settled for me-too WMA stores. 7Digital hasn’t. The irony of all this though, is that DRM-free shouldn’t even be an issue anymore.”

Now I`m looking forward to the “MySpace Music” start… will it achieve all the expectations? We will see at the end of the week…

Pricing Models For The Digital Age

September 15, 2008

I already quoted Chris Anderson yesterday and must once again. He brought to my attention this great paper by Prof. Hal Varian (for all of you who have had not the honor to study a few semesters of economics… he is “god” … well my professors told me so… by the way Mr. Varian is the “chief economist” at Google at the moment…)

In this paper, Varian describes 14 business models that allow content creators to make money even if they cannot stop the content from being distributed for free.

  • Make original cheaper than copy.
  • Make copy more expensive than original.
  • Sell physical complements.
  • Sell information complements.
  • Subscriptions.
  • Sell personalized version.
  • Advertise yourself.
  • Advertise other things.
  • Monitoring. (ASCAP monitors the playing of music in public places, collects a flat fee, which it then divvies up among its members.)
  • Site licenses.
  • Media tax.
  • Ransom. (Allow potential readers to bid for content. If the sum of the bids is sufficiently high, the information content is provided.)
  • Pure public provision.
  • Prizes, awards and commissions.

Some of these models are better than others… some only work for a very specific kind of content, but they are all options.

Three Business Models Of Free

September 14, 2008

Found this basic thought on Chris Anderson`s blog
If you want to make money with free products, you will have three options for your basic business model.

Of course you can combine this models. So everybody who tries to make money with media content will basically play in this area in the future. It´s as simple as that. Well it isn´t…

The Free Digital Library

September 12, 2008

Brewster Kahle has a dream. He is trying to build a truly huge digital library — every book ever published, every movie ever released, all the strata of web history … all free to the public.

As he shows in his TED talk, we are not far from it … well technically… of course there are some other “challenges” to overcome…

What could this mean to the media industry? Is there any chance to get this through? How should publishing/content industry and the library coexist? What´s the model?

When we go digital, there will be the point where everybody will have access to all knowledge that was ever released to the public. That´s where we are heading. Don`t know how long it will take, but we will get there.

So we should start adressing the questions above.

The Unlimited Free Jukebox In Your Pocket

July 19, 2008

A dream a few years ago… and now we are nearer than we think.

Just found this Mediaweek article:

“Internet radio upstart Pandora has streamed 3.3 million songs to iPhone users since the launch of its new mobile application, making it the third most popular such app for the red-hot device”

Using a data flat rate on the iPhone, you can enjoy all the big music streaming platforms (not just Pandora, Last.Fm works already too – see the userinterface in the pic) for free…

Well, not  everybody has an iPhone or something equivalent in his pocket yet… but soon.

Napster Reloaded – DRM Free

May 20, 2008

Napster just launched the largest digital rights management-free music store in the world, with six million songs that can be loaded onto just about any digital audio player.

So here we go… Napster with a two way solution, subscription and pay per download. And on top of that a great digital music brand… maybe this is serious competition for itunes now.

I can imagine that some people will start as Napster customers, by buying DRM-free songs a la carte, and after a while they will realize that a subscription service is very useful…

The brand Napster is quite interesting… up to now, the business model was not on a competitive basis to a mainstream target group, and it wasn`t really possible to capitalize the brand, but now…

If the brand and the shop is able to add more “context”, meaning getting traffic from mags, music portals, blogs, cooperations with media brands et cetera…. then it will provide a competitive product and possibly gain back their “pirate” community”…

Well, we will see…