stories filed under: "free"
Why It Makes Sense For Record Labels To Offer All Music Freely As MP3s
from the the-argument-is-spreading dept
We've been making this sort of argument for many, many years, but it's nice to see that it's catching on in a variety of places, including the more mainstream media. Over in the UK, there's a column in the Telegraph advocating that record labels stop trying technological and legal efforts to fight unauthorized file trading online, and instead give away all their music as free MP3s, and focus on alternative revenue streams. The crux of the argument is the same one that we've made over and over again, namely (1) fighting unauthorized file trading is counterproductive, doesn't work and will never work and (2) once you free up the music, there are all sorts of compelling business models you can adopt that can actually help you make more money. The column is a bit weak on highlighting some of those business models, though there are plenty. But, it's still nice to see the concept getting more attention.Financial Columnist Stands By Her Claim That Kids Giving Away Lemonade Are Destroying America
from the it-must-be-stopped dept
We recently wrote about the bizarre, and economically clueless, column by a so-called "financial expert," Terry Savage, who apparently accosted some young girls for giving away free lemonade, saying that they showed what was wrong with America, since they should be selling the lemonade. The irony over the fact that she was giving them "free" advice apparently did not occur to her. Not surprisingly, a lot of people contacted Savage to express their bewilderment at her column, and rather than admit that perhaps she got the story wrong, she's standing by it. Phillip alerts us to her most recent column, where she tries to explain, yet again, why these girls were destroying America. It's not that she's against charity. Or even that she thinks charity goes against capitalism. It's that she has decided what's best for these girls is to learn how to make an honest buck.Basically, Savage seems to insist that, despite not knowing anything at all about these children, their situation, their upbringing or their parents, that it was an absolute mistake not to have them selling the lemonade.
It's important to start teaching those financial lessons at an early age. These little girls, around age 7 or 8, are already targets of consumer marketing -- for everything from toys to videos, from fashion to food. Certainly, it's also the right time to teach them the value of the money they spend, and how difficult it is to earn it.It certainly is important to teach kids financial lessons. But that doesn't mean they can't give away lemonade as well.
The children weren't rescuing people from the heat, since it was a temperate day. They were just looking for something to do -- and there was no one around to teach them how a lemonade stand should really work.And that's the crux of the issue. Savage has decided that she knows how a lemonade stand "should work." She's also decided that she knows how to best act as a parent for some young girls she knows nothing about. How does she know that they didn't earn the money used to set up the lemonade stand? How does she know that the lemonade stand wasn't a reward for something else they did? She's just decided to take it upon herself to tell children what they should do without knowing anything about the details of what's going on? That's not very convincing.
Filed Under: economics, free, lemonade, terry savage
Author Puts Novel Online For Free... And Gets A Book Deal
from the but-free-never-works dept
alex was the first of a few of you to send over the story of how author Marta Acosta posted her "young adult vampire novel" online for free at Scribd, where it became a top download with tons of great reviews... and that helped her get a book deal with Tor, who will be publishing the book in hardcover shortly. Once again, another example of how "obscurity" is a bigger problem than "piracy" for most content creators.Filed Under: books, free, marta acosta
Companies: tor
Is It Better To *Require* Or *Request* Something In Return For Free Content?
from the the-debate-goes-on dept
Over at Music Think Tank there's a blog post provocatively titled: Why Music Should Never Be Given Away For "Free", which brings up a point I've heard multiple times from various music industry marketers (many of whom I generally agree with). They say it is okay to give away music without a monetary transaction taking place, but instead you should demand something else in return. In this post, he suggests requiring an email address, a retweet or a Facebook share in order to get free music.I definitely understand the general rationale for this line of thinking, but I'm afraid that people are going too far with it, and it's actually harming the value of free music in some cases. Obviously, it's great if you can get something (monetarily or not) in exchange for the music, but putting up a barrier can also be harmful. First of all, if it's truly a brand new fan who hasn't heard your work, they might not be willing to commit to you in that way. Especially when it comes to Tweeting or Facebooking an artist. If I don't know the artist, there's no way I'm mentioning them to all of the people who follow me on various social networks. On the flip side, when I do see friends who make those kinds of Tweets, they feel like spam. They're not at all convincing and they don't feel authentic. They feel forced. Honestly, when I see people post social networking messages in exchange for free tracks, it actually makes me less interested in the musical act, because I feel like they need to beg for attention, rather than letting the fans organically give them attention.
Finally, part of the reason the whole "free music" world exploded the way it did was because of the massive simplicity and lack of friction in music sharing, which made music discovery and promotion much more seamless and easy. Putting required friction back into the process seems like a mistake, and will likely just drive fans (or potential fans) either to other artists or back to the same file sharing systems that remove that friction. That doesn't help anyone.
So rather than requiring an explicit exchange, it always seems a hell of a lot more effective to offer the content for free, but ask for the exchange as a voluntary setup: "If you like these songs, tell your friends or sign up for our mailing list" or something like that. This way it's not forced. It's not inauthentic. It's not friction. It's about trusting the listeners, rather than trying to force them to act in a certain way.
Filed Under: business models, economics, email, fans, free, music, social media, transactions
Financial Columnist Lectures Little Kids Who Want To Give Away Lemonade That They're Destroying America
from the wow dept
Stuart sends over a column from a Chicago Sun-Times columnist, Terry Savage, that I could have sworn was satire until someone convinced me that it's not. Savage is apparently a "financial" columnist, who apparently is a bit confused about her basic economics. Over the long weekend, she decided to celebrate the American way by berating and lecturing some children who set up a lemonade stand because they wanted to give away the lemonade for free. According to Savage, these kids represent all that is wrong with America. I'm not joking."No!" I exclaimed from the back seat. "That's not the spirit of giving. You can only really give when you give something you own. They're giving away their parents' things -- the lemonade, cups, candy. It's not theirs to give."Shockingly enough, you can read Savage's column -- for free -- online. I'm guessing she doesn't get the irony. Savage seems confused about a whole lot of things, from the concept of philanthropy and sharing to some very, very basic economics. For someone who presents themselves as a financial expert, this one column seems to undermine any credibility in the field.
I pushed the button to roll down the window and stuck my head out to set them straight.
"You must charge something for the lemonade," I explained. "That's the whole point of a lemonade stand. You figure out your costs -- how much the lemonade costs, and the cups -- and then you charge a little more than what it costs you, so you can make money. Then you can buy more stuff, and make more lemonade, and sell it and make more money."
I was confident I had explained it clearly. Until my brother, breaking the tension, ordered a raspberry lemonade. As they handed it to him, he again asked: "So how much is it?"
And the girls once again replied: "It's free!" And the nanny looked on contentedly.
No wonder America is getting it all wrong when it comes to government, and taxes, and policy. We all act as if the "lemonade" or benefits we're "giving away" is free.
Of course, the kids aren't expecting that they should get government handouts for free. They're getting marginal benefit from making (most) people happy in giving them free lemonade. Economics is not about cash, it's about benefits vs. costs. Yes, they're often calculated in cash terms, but if the marginal benefit to the children is greater in giving away the lemonade, there is nothing wrong with that at all, and it's certainly not against "basic economics" as she claims later in her column.
Again, I need to remind everyone, that you can read her column for free on the Chicago Sun-Times website. Why? Because the marginal benefit to the Sun Times and to Savage herself is higher in giving away the content for free. In the case of the Sun Times, it's from the ad revenue it receives, and in Savage's case whatever (probably too high) sum the Sun-Times pays -- and also for the "free promotion" it's supposed to give to help her sell her books. In other words, the marginal benefit to having her columns online for free is greater than the marginal cost. Just as the marginal benefit to the little girls from seeing happy people by giving them lemonade outweighs the "costs."
If we can't teach our kids the basics of running a lemonade stand, how can we ever teach Congress the basics of economics?Why don't we start by teaching our "financial experts" the basics of economics?
If that's what America's children think -- that there's a free lunch waiting -- then our country has larger problems ahead. The Declaration of Independence promised "life, liberty, and the pursuit of happiness." It didn't promise anything free. Something to think about this July 4th holiday weekend.Wait, what? You know what the Declaration of Independence also didn't include? Anything about how much "life, liberty and the pursuit of happiness" costs. You know why? Because it has nothing to do with whether or not something costs money or is free. So that's not "something to think about" because it makes no sense.
But, perhaps we shouldn't be surprised that someone who thinks it's a good idea to lecture little children against sharing lemonade isn't exactly the most logical of thinkers out there.
Filed Under: economics, free, lemonade, terry savage
Another Journalist Seduced By App Madness Predicts The End Of The Web
from the ah,-technology dept
We've talked a few times about the media's obsession with "apps" as the solution to what ails them. They get one glance at the control that an app appears to provide, and they go wobbly in the knees and fail to consider basic trends and basic economics. As a few folks have noted, locked down apps are like the CD-ROM craze among media types just as the web first became popular. Who won that battle?The latest reporter to fall under the sway of the app-run future is The Atlantic's Michael Hirschorn -- a writer who's work I usually like quite a bit. He writes eloquently about the "closing of the digital frontier," and predicts that the days of the browser are dying, as the days of the app are rising. In the process, he misleadingly attacks the basic economics of free, the history of Silicon Valley, and some rather important trends.
He kicks it off, as nearly all attacks on the economics of digital goods does these days, by mocking the old "information wants to be free" phrase, which he falsely suggests led the world astray. Rather than recognizing the basic economic forces that made (and still make) digital goods to be driven towards free, he pretends it's just an idea a bunch of "hippies" had -- that somehow hypnotized everyone else:
With the long tail of Brand's dictum chopped off, the phrase Information wants to be free--dissected, debated, reconstituted as a global democratic rallying cry against monsters of the political, business, and media elites--became perhaps the most powerful meme of the past quarter century; so powerful, in fact, that multibillion-dollar corporations destroyed their own businesses at its altar.Of course, it wasn't some blind support for a mantra that resulted in so much being free online. It was the basic economics of content, and a recognition of how those models can work. But, Hirschorn is so sold on this idea that "free" was just the pipedream of a bunch of digital hippies someone tricked the rest of the world into buying, that the one story he uses to explain this sense of "gospel" actually seems to disprove his point. He actually suggests that the fact that the online world quickly and decisively debunked the infamous 1995 Time Magazine technopanic about online porn is an example of the unwillingness of the digerati to be open to new ideas:
It's a bit of a Schrodinger's-cat situation when you try to determine what would have happened if we had not bought into the IWTBF mantra, but by the time digital culture exploded into the mainstream with the introduction first of the Mosaic browser and then of Netscape Navigator and Internet Explorer, in the mid-'90s, free was already an idea only the very old or very obtuse dared to contradict.
At the WELL, the core gospel of an open Web was upheld with such rigor that when one of its more prolific members, Time magazine's Philip Elmer-DeWitt, published a scare-the-old-folks cover story on cyber porn in 1995, which carried the implication that some measure of online censorship might not be a bad thing, he and his apostasy were torn to pieces by his fellow WELL-ites with breathtaking relentlessness.... In retrospect, what seems notable is the fervor with which digital correctness--the idea that the unencumbered flow of everything, including porn, must be defended--was being enforced. In the WELL's hierarchy of values, pure freedom was an immutable principle, even if the underlying truth (that porn of all kinds was and would be increasingly ubiquitous on the Web, with actual real-life consequences) was ugly and incontestable.Now, I put a brief ellipsis in the middle of that paragraph, because right in the middle, Hirschorn hides the key fact: that those folks who pointed out the massive problems with the story were correct! Hirschorn basically tries to hide that point in the middle of the paragraph, where the beginning and the end of the paragraph suggest that people pointing out the massive flaws and outright ridiculousness of both the "study" and the Time report based on the study, were somehow overreacting in this religious fervor to sustain the digital wild west. The fact that Hirschorn even admits that the study was flawed, and then still claims the debunking was "political correctness" is bizarre and, quite frankly, insulting. Those who responded to the report didn't do so out of some "porn must be free" ethos. They did so out of a belief that truth is more important than blatant lies.
Hirschorn then goes on to make a stunningly ignorant statement concerning how the entertainment industry responded to the "open and free" internet:
Ironically, only the "old" entertainment and media industries, it seems, took open and free literally, striving to prove that they were fit for the digital era's freewheeling information/entertainment bazaar by making their most expensively produced products available for free on the Internet. As a result, they undermined in little more than a decade a value proposition they had spent more than a century building up.Wait. Which "old" entertainment industry is he talking about here that put its most expensively produced products onto the internet for free? Last I checked, we seem to have a new story pretty much every single day about just how hard the old entertainment industry is fighting to stop its content from being online for free. Furthermore, in the few cases where they have put stuff online for free, it's not because they were "striving to prove they were fit for the digital era's freewheeling information/entertainment bazaar," but because they were dragged kicking and screaming after someone pointed out to them that others had already put all their content online for free, and that if you put your content online, you actually had some ability to monetize it -- whereas, if you left it to everyone else, you made that more difficult. Somehow Hirschorn doesn't know this. It makes me wonder if he even uses the same internet the rest of us use.
This is the myth of "the original sin of free" all over again, where otherwise smart people think the decision of some to go free wasn't actually driven by marketforces, and that there actually was a different choice back then. These forgetful souls don't want to acknowledge that paywalls and micropayments have been tried time and time again since the early days of the web -- and they almost all have failed.
But now, it seems, things are changing all over again. The shift of the digital frontier from the Web, where the browser ruled supreme, to the smart phone, where the app and the pricing plan now hold sway, signals a radical shift from openness to a degree of closed-ness that would have been remarkable even before 1995. In the U.S., there are only three major cell-phone networks, a handful of smart-phone makers, and just one Apple, a company that has spent the entire Internet era fighting the idea of open (as anyone who has tried to move legally purchased digital downloads among devices can attest).It's a weird sort of argument that plays up the benefits of a lack of competition in the marketplace.
Apple, for once, is swimming with the tide. After 15 years of fruitless experimentation, media companies are realizing that an advertising-supported model is not the way to succeed on the Web and they are, at last, seeking to get consumers to pay for their content.Actually, plenty of media companies are finding that an ad-supported model works great. And, yes, while many publications are seeking to get consumers to pay, history has shown that it doesn't tend to work very well in the long run.
They are operating on the largely correct assumption that people will be more likely to pay for consumer-friendly apps via the iPad, and a multitude of competing devices due out this year, than they are to subscribe to the same old kludgy Web site they have been using freely for years. As a result, media companies will soon be pushing their best and most timely content through their apps instead of their Web sites.That's one theory, but it seems unlikely beyond a certain niche. Yes, people will pay for some apps. But already some are realizing that the web itself is actually better. And, the key point that so few app-afficionados seem to recognize is that apps and websites really aren't that different. Most of the things that an app can do can also be done on the web. And, as HTML5 starts to catch on, the web will be able to do even more. Hell, the dirty little secret out there (which isn't really a secret -- it's just that a lot of folks praising apps don't realize it) is that a good percentage of these "apps" that they're so amazed by? They're really webpages. They're really HTML that's wrapped in a little app container. But there's no reason they can't just be HTML -- and as the inevitable market forces continue, many are likely to move to the web, and get out from under the withering thumb of control of Steve Jobs.
On a more conceptual level, the move from the browser model to the app model (where content is more likely to be accessed via smartly curated "stores" like iTunes, Amazon, or Netflix) signals the first real taming of the Wild Digital West.Statements like this remind me back of the days when people would load up their computer desktops with all sorts of apps as well. And then the web got good. Those who don't know their history are doomed to miss the fact that it's about to repeat...
Apple's version of the West has nice white picket fences, clapboard houses, morals police, and lots of clean, well-organized places to spend money. (The Internet, it seems, is finally safe for Rupert Murdoch.) These shifts are seemingly subtle, but they may prove profound.AOL's version of the West, back in the 90s, also had nice white picket fences, clapboard houses, morals police and lots of clean, well-organized places to spend money. And then people discovered the web. And all that got abandoned quickly.
Like the AOL of the 90s, it is true that the closed platform of the iPhone offers a nice on-ramp for people to learn how smartphones can work, and what they can do. But, in the long run, the openness of and raw innovation of the open internet won out. Why does Hirschorn think that the same won't happen again? Oddly, when he does get around to Google -- who is providing one extremely popular open road -- he repaints Google's position as being on the defensive and trying to preserve an old business model:
Google, which built its once monopolistic position by harnessing the chaos of Web search, has been forced to move aggressively to preserve its business model against this new competition: it has teamed up with the Apple-scorned Flash; is making conciliatory gestures to the content owners it once patronized; has reached a deal to purchase a mobile ad-sales platform; and is promoting its own vision of the future based on cloud computing. Phones using its open-source smart-phone operating system, Android, are outselling the iPhone. Even so, Google still needs for the Web, however it's accessed, to remain central--because without contextual search advertising, Google ceases to matter. Smart phones in general, and the iPad more pointedly, are not driven by search.Again, most apps actually are just webpages. And there isn't anything about Google's business model that requires the web to be central. I have plenty of apps on my Android phone that have Google contextual ads. Also, the last point: that smartphones are not driven by search, seems utterly bizarre to me. I use search pretty damn frequently on my phone.
All of this suggests that the era of browser dominance is coming to a close.Except that most of the points leading up to that conclusion weren't substantiated or were blatantly wrong.
And then, Hirschorn really goes off the deep-end. He brings back up the importance of paywalls, which leads to this doozy of a statement:
If they don't end up licensing original content, networks such as Twitter and Facebook will become purely communication vehicles.Wait, what?!? Twitter and Facebook are communication tools. That's why people use them. What does he think they are? That's like saying, a century ago, that if the phone company doesn't license radio programs, the telephone might just be used for communication.
Honestly, this article is one of the more bizarre ones I've read in this style. It's as if it's written by someone living in an alternate universe, and has no access to history or general computing trends.
Michael Robertson's Crowdsourced List Of 1,400 Examples Of EMI Giving Away Free Music; EMI Denies All But 3
from the um... dept
Want some free music from EMI? You may remember that EMI is in a legal battle with Michael Robertson and his current company MP3Tunes (well, one of his current companies). MP3Tunes is a music locker. It only lets you upload your own songs, but also does have a search engine, Sideload.com, that will search for freely available music online. As part of the lawsuit, EMI insisted that EMI has never authorized music to be posted for free online, so any and all music from EMI that is found by Sideload must be unauthorized. Except... of course. that's not true. EMI hands out free mp3s to journalists all the time to post, and often has them on their own website. When asked about it, EMI finally admitted to allowing a grand total of three songs to be distributed freely online.To prove that EMI was lying, last fall, Michael Robertson offered up a bookmarklet that people could use to let him know whenever they found free MP3s of EMI music on legitimate sites (mainstream media, artist's own websites, label marketing sites, etc.). That "You Lie, EMI" bookmarklet seems to have worked wonders. Robertson has now collected over 1,400 examples of EMI giving away free MP3s. He's even put the whole list in a nice Google spreadsheet, so you can check it out yourself (and even see where EMI has put up free music).
I'm not surprised to see our friend Lily Allen on the list. As you may recall, last fall, right after Lily went on a bit of a rant about the evils of file sharing and distributing unauthorized music, we pointed out that on her official LilyAllenMusic website, she and EMI (who runs the website) were distributing mixtapes full of songs from EMI artists... and artists from other record labels as well (though, we doubt EMI got the rights to do that).
Either way, nice job crowdsourcing the proof that EMI does, in fact, lie:
This list is just a fraction of the songs EMI makes available, but it's irrefutable that EMI uses free song files as promotion. Astonishingly they are still telling the court that they don't authorize song files to be distributed for free. They are denying these songs are legitimate in spite of overwhelming evidence of MP3 files from retailers, blogs, artist sites, label sites, and marketing sites. Even when you point to one of their own corporate blogs which offers downloads they remain steadfast in their claim that they don't distribute MP3s online for free.But weren't we just told by the head of PPL in the UK (home of EMI) that "there is no such thing" as "promotion" when it comes to music, and "for free" should be erased from our vocabulary. Perhaps that explains EMI's actions. They no longer recognize the concept of free promotion as existing after listening to Fran Nevrkla's speech.
Thanks to the MP3tunes user community, we have powerful evidence to refute EMI's claims that they don't distribute promotional songs. I think it's one of the first examples of crowdsourcing evidence. The evidence was assembled not by parties to the litigation or their legal teams but citizens with a computer and motivation to help out. We'll learn later this year whether it will help MP3tunes prevail.
Filed Under: free, michael robertson, mp3s, music, promotion
Companies: emi, mp3tunes
Starbucks Finally Realizies That Free WiFi Is The Way To Go
from the took-'em-long-enough dept
Way back in 2003, we explained why fee-based WiFi almost certainly did not make sense for coffee shops like Starbucks. A year later, we had a discussion on how the program could be a lot more successful if it went free. But, for years, Starbucks insisted that the paid WiFi was a success. Except, if you watched, it gradually got more and more "like free." And that's because few people were actually using the paid version. And, now, finally, after all of these years, Starbucks is finally going to completely free WiFi. It's finally admitting that WiFi was always a complementary service to get more people to buy its high margin goods -- rather than a product itself.Success Of Free D&D Online Leads To Free Lord Of The Rings Online, Too
from the good-to-see dept
Slashdot points us to the news that Turbine is now planning to offer their Lord of the Rings Online as free to play starting this fall. This follows last year's decision to turn Dungeons and Dragons online into a free offering, which actually resulted in a massive increase in revenue. Nice to see them expanding this to other areas.What may be more interesting here is that this decision comes soon after Warner Bros. (the studio) bought Turbine. Warner Bros., as a movie studio, isn't exactly known for embracing "free," so it's nice to see that they're actually okay with expanding this program. Maybe they'll actually learn something to take back into the other parts of the business...
Filed Under: business models, d&d, free, lord of the rings, online games
Companies: turbine, warner bros.
