Start Up Blog

Short media memory & piracy

Posted in entrepreneurship by Steve Sammartino on January 11, 2014

Kim Dotcom sent out a tweet a couple of days ago on how to stop digital piracy. It was the most succinct realistic view of the digital market place I’ve read. While the stop part might be an overstatement, it would certainly minimise it. I’ve taken his points and listed them below:

How to stop piracy:

  1. Create great stuff
  2. Make it easy to buy
  3. Works on any device
  4. Same day global release
  5. Fair price

The last four on this list really speak volumes. But the thing which is really standing out to me on this list, is that most media companies seem to have forgotten the reasons why they did things a certain way prior to the digital era. Most of their decisions were based on what was possible. The limitations on selling their goods were physical realities. Although these physical realities no longer exist, they seem to have forgotten why they did things a certain way. That way was the only way. The stability of the media system pre-web seems to have distorted their minds to the point that they forget the ‘why’. I’m going to reference the recorded music business to show how their rigidity has failed them. In fact the digital world is actually what they always wanted, and that piracy is not the problem, but the industry’s poor memory.

Make it easy to buy: In a digital age, the best advice anyone can give, is to sell it in as many places as possible. This is always the case for any mass market product. Rewind back to the pre digital music industry and you’ll remember that record companies would sell their records in any store that would stock it. Kmart, Target, Walmart, the local independent record shop. So long as it was out there they were happy. Sales representatives were judged on the number of distribution points they got their stock into. But for some reason they seem to have forgotten this fact. They now decide to hold back on potential distribution points for no apparent reason. The early iTunes revolt being the easiest example we can all remember. Totally counter to what they did before the format changed. So why the music industry don’t embrace this and make it ‘easy to buy’ is beyond me.

Works on any device: It used to be really hard for the music industry to do this before digital. They had to invest in manufacturing for vinyl records, then cassette tapes, then beta, then VHS, then CD…. but they did it and moved quickly to have their content available in all formats. So why the change of heart now? Why don’t they move as quickly as they used to? This is especially strange given that they no longer have to make physical stuff to make their content available on any device. Or even worse, when it’s already loaded up onto a content platform and they restrict usage depending on the device you a re retrieving it from. Vevo on youtube is the classic example. If a song won’t play on my mobile via Vevo, I’ll just listen to a another song. No revenue for you! It’s much easier to do now than it was then.

Same day global release: If you can, then you should. Simple. Here’s the thing the recording industry has forgotten about their pre digital staggered global release programs. Every new market (country) they entered had extra associated costs with it. They used to have to make more stock (records, CDs) to sell. Pay to get their content promoted on TV and radio. (Now we’e all immediately aware of of any big music launch once it happens) They had to change the formats to suit particular markets. They had to ship records on boats for 4+ weeks across oceans. They wanted to be sure the record would be a hit before they invested all the money into wider market expansion. They had reasons to delay global release plans. Reasons largely around stock, promotions, production and mitigating financial risk. None of these reasons exist today.

Fair price: When people get a raw deal, they find an alternative. They even cheat. People know the costs of content distribution are minuscule compared to the pre-digital era. This ought be recognised more than it has been in many digital channels. I truly believe most people will pay a fair price. And in the words ‘fair price’ I would like to add the idea of purchase without friction. Simple ways for us to give you our money so we can get on with enjoying the content. Not a million hoops to jump through. I’d go as far as saying that most people want to pay those who bring them joy with their output. In a world of zero cost digital duplication, then fair pricing  would mean taking out 100% of the now removed physical production costs.

Once we get over the fact that anything which is both digital and good will be pirated by some people, then we can get on with business and just know it’s a fact of life. A cost of doing business. We shouldn’t let it paralyse us into avoiding new methods.

The laws of nature tell us much about piracy or lost revenue. If we don’t distribute the output it goes bad. Stored water which isn’t sent out via distribution channels evaporates, natures form of piracy. The longer we wait, the more we lose.  We can add to this the frustration distributors have with non global release plans.  So much so that distributors are becoming makers (Netflix) because they can’t get what they need.  The end result is a great demarcation with all things digital. If we can’t get it, we’ll make it ourselves or source it elsewhere. The best approach would be to embrace the reality omnipresence and immediacy. 

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3 Responses

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  1. Sally Lewis said, on January 12, 2014 at 7:10 am

    Reblogged this on Tea and Trivia and commented:
    “The longer we wait the more we lose”

  2. samotage said, on January 15, 2014 at 1:14 pm

    Consider this. The “record companies get to double dip”

    When I was a boy, I bought the LP Icehouse Man of Colors, and others and CD’s

    Now, I’m no longer a little pup I have no idea where these hard copies are, some are in boxes some lost. I think I ripped my CD once, but itunes corrupted the files and I have 1/2 this album.

    Just now I wanted to listen to it, and was dismayed about the above corruption, so the easiest way to solve is to just buy it again. The double dip…

    It is annoying, it’s cost practically nothing to deliver – the record recovered all recording costs in the 80’s so it’s money for jam.

    Sam, @samotage

  3. saad said, on January 22, 2014 at 4:30 am

    just not enough to say “say no to piracy, we should do overcome this prob via support legal contents.”


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