Last month, Ron Miller gave us a blog that clearly distinguished content stealing from content sharing. The former is piracy, he argued, but the latter is not -- and Big Content (as I like to call the studios and music labels) couldn't or wouldn't tell the difference.
Ron went on to say that building a consensual solution to piracy won't be possible until Big Content lets go "of notions of total command and control." All very fair, except for the elephant in the room. Content stealing is indeed piracy, and it's here to stay. That's the really challenging fact Big Content has to get its collective head around. Or not.
Writing for Forbes under the brutal heading "You Will Never Kill Piracy," contributor Paul Tassi makes what seems to me to be the unarguable case that as long as people can download content much more easily and conveniently than they can otherwise obtain it (buy a DVD or go to a movie theater), then that's what they're going to do. Especially when there doesn't seem much chance of getting caught, and it doesn't really feel like stealing.
Let's pause right there. Never mind whether it feels like stealing, Big Content will say. Theft is theft. The trouble is that the classic definition of "theft," both in law and language, has always involved the intent permanently to deprive the rightful owner of the thing stolen. That's not happening with piracy. You can "steal" a thousand copies of a movie, and it will just keep reproducing itself.
Don't be silly, Big Content will say. We're talking about loss of sales, and there's plenty of room for debate about how large or small that loss is. It's not persuasive, however, to the individual who sets about downloading something for which he and she would not dream of paying the full price.
The first thing Big Content needs to get drilled into its saurian brain is that prices are set, ultimately, not by studios and music labels, but by the market. And the market -- except for certain niche segments -- is no longer willing to pay $30.99 for new DVDs, $17.99 for new CDs, or $26 for a couple to go to a movie theater (popcorn not included).
The second thing Big Content needs to grasp -- and this is where one might despair -- is that alternative sources for movies and music are not going to be driven out of business. Pirate Bay has been around almost 10 years and is ranked the 79th-most visited site on the Web.
Finally, the message Big Content needs to receive is a very simple one. If you can't beat them, join them. As Tassi shrewdly points out, companies like Netflix, rather than being Big Content's second-most deadly enemies (after the pirates), could actually be Big Content's saviors. Convenience and cost are the two factors that will keep pirates in business indefinitely. That's where Big Content has to compete.
Stop shackling content to the purchase of little shiny discs in plastic boxes (hello, Blu-Ray). Stop trying to prevent your customers from sharing things they already own. Instead, provide -- or allow Netflix or YouTube to provide -- readily accessible content at a price set by consumers. There will still be pirates, but the audience might be persuaded to give legitimate content another chance, if it can be obtained instantaneously and at an affordable price.
True prices are determined by the market, or whatever people are willing to pay, which in Internet terms means no price or $0$. Why won't people pay for internet content? Because they are used to it. So the next stage is how do you get people used to paying for Internet content. Next up where does "sharing" (free) cross the line. Is sharing music with a dozen friends the same as making it available on-line for a million people to "share" and pass around? What would happen if some industrious blogger decided to just copy and share original content of the New York Times on some web site or copy and share Apples latest OS and put it up for free. Maybe we are all crazy that could also be a possibility and have zero solutions to a problem that threatens to wreck whatever is left of the "economy". Just dice and slice content up into derivatives and hope for the best maybe that would work.
I agree that's bad news in the abstract, Mike, but thankfully we've already seen that there's a more effective lobby than the RIAA: namely the Internet-using public. The monster isn't going to get that.
Wow. Magnetic links. Wikipedia has a decent explanation. As I understand it, the magnetic links point to content but contain no information about its location. Another example of the Internet staying a few steps ahead of those who would fetter it.
Analysis: the torrent freak and pirate bay crowd have made tracking another level more difficult and this will push the defense harder to demand deep packet inspection
certain elements will be cheering them on as it could mean they might get their ultimate prize: the Alternate Decryption Key, or ADK.
No ADK? un-approved cipher? we forward your data to the Bit Bucket
the music/entertainment sharing business however is a very open society: easily infiltrated. the RIAA and MPA should simply hire their own detectives as appropriate to this matter: they should not be permitted to impose huge processing penalties on the rest of the 'net to protect their interests. that would be an un-authorized tax.
Certainly, the fact that independent content creators can upload good Web series to YouTube or produce CDs on a shoestring suggests fantastic amounts of waste and mismanagement in what Big Content producers are doing. But I still think misguided greed plays a role in price-setting. Remember the leap in price from vinyl records to CDs, despite CDs being cheaper to manufacture - how much money we all spent duplicating our vinyl purchases in a physical format which, frankly, we no longer need? I have hundreds of CDs (thousands of dollars) gathering dust, because it's easier to play music with a few clicks.
Excellent observation about how the old royalties model no longer works. There is so much dilution going on that older, bigger acts like the Rolling Stones really only make money anymore on their concerts.
I wrote a post that made similar arguments on the CMO site titled "Why Content Pirates Will Win". Very much the same arguments, pointing out how fighting what they perceive to be piracy is an expensive and futile battle, that it's a market adjustment, and that adaption was the key to success.
And it's not just Big Content who seems to lack this grasp as I've had to drill it into the heads of some small-time content producers as well.
My current theory is that the proper price to charge for content is about the same as what you'd have to pay to advertise it. So if say, Google Adwords would charge you $1.50 per click on average to advertise your content, you charge people $1.50 per copy. The idea is that the content owner trades up the cost of the content in exchange for word-of-mouth advertising. The $1.50 price tag itself is small enough that people wouldn't think twice about purchasing it anyway. Included in this theory is that one also needs to ensure all content links back to the source somehow. Those who want more can then follow the link to the source, and with the low price-tags and convenience of having all related content in the same place, they'd be likely to buy the stuff they want from there.
so many hands in the pie scrambling for a piece . . Kurt you got that right. Can only imagine what the financial statements must look like for say U2 or Journey or some big act like that. I doubt you would see . . Apple computer that the band made the album on. $2000. Promotion on YouTube. Free. Twitter and facebook. Free. Weeks supply of Ramen noodles. $12.50. Weeks supply of beer. $50. CD's . . 200 ripped on the Apple. $25.
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