The Creator's Dilemma On Others Making Money Off Your Content

from the offer-it-up-yourself dept

A couple of folk sent in this story of Ryan Sohmer, author of the popular web comic Least I Could Do, where he complains about others "stealing" his content in iPhone apps. But, this isn't the usual case of a content creator lashing out about "stealing." Sohmer has built up a nice model in giving away his comics for free, and we even wrote about his anger earlier this year at the Writers Guild of Canada for trying to force ISPs to pay a "tax" to writers. On the whole, his views are quite progressive on business models and free content. But what he's upset about here is that some others are taking his comics and putting them in fee-based iPhone apps, and thus "profiting" off his content, without his permission:

As a general rule, I'm fairly lenient with individuals using our content for personal use. You want to throw up a comic on your blog, use our avatars or wallpapers, that's fine. That's actually what they're there for and truth be told, we appreciate you spreading the word.

Where I draw the line, however, is an individual lifting our entire comic archives, putting them in an iPhone app, charging 99 cents for it and putting their own advertising banners on each comic. Profiting off of our hard work without so much as a link back to this site. No justifying that, that's ripping us off, plain and simple.

The sad reality of it, is that things appear to be getting worse. Almost every day, I receive a couple of e-mails telling me about a new app or aggregator that's featuring Least I Could Do or Looking For Group.

Alex Winston, who was the first to send this in, asked what we thought Sohmer should do in such a situation, and wondered how those who are open to sharing their works should deal with cases where others profit from those works. We've actually discussed something similar recently, but to more directly address the question, I tend to think that the answer is to simply supply a similar offering yourself -- and make it clear which ones are the official versions. Even if you're giving away your content for free, if people want to pay for it, why not offer them a way to do so? And, if you make it quite clear which is the official version and which is not, most people will go for the official version, because they want to support the artist.

And, if you're still offering your works for free, and yet others are making money off of some sort of "aggregation," well, at some point you have to admit that perhaps it's the aggregation they're paying for, rather than the content itself, since they could have received the content for free. I recognize that it can seem upsetting at first if it looks like someone is "making money off of my content," but rather than worry too much about it (since it's not going to go away), the answer is to focus on doing whatever it is you can do to make sure that people know of ways to support you directly, and then it's up to them. If someone else is somehow offering something better, then perhaps look into ways to improve what you offer as well. But, in the end, worrying about what other people do will only get you so far. Focus on what you can do.

An alternative option is that if someone is really doing something that is better with your content, you could approach them, and ask them for a reasonable cut of the revenue, noting that in exchange, you'd promote their app to your fans, as well. That would likely increase the number of buyers, and everyone comes away happy.

Filed Under: copyright, free, profit

Free Content Undermines Democracy?

from the people-pay-you-for-this? dept

A journalism professor by the name of Tim Luckhurst is claiming that newspaper paywalls are needed to preserve democracy, and that free content online undermines democracy. We've heard this argument before, and it makes no more sense now than when it was first raised. The basic argument is that free content online isn't bringing in enough revenue to pay reporters, thus newspapers are going under and firing reporters. Thus, with fewer reporters, there are fewer people to watch the government and therefore corruption runs rampant. Or something like that.

Of course, there are so many fallacies wrapped up in this argument, it's difficult to even know where to start (though, one would have hoped that a journalism professor would have done the decent thing and checked into these things a bit more carefully before writing a silly opinion piece based on a variety of myths):

• Newspapers need readers to pay to survive. Not true. Not even close to true. First, newspapers have almost never made money from subscription fees or newsstand purchases. Those fees rarely even covered the cost of the newsprint and delivery. Newspapers have always made their money on advertising and classifieds (a form of advertising).
• Free content online is why newspapers are in trouble. Again, not true. In most cases, the publications that are in trouble are in that position because they took out tremendous amounts of debt. Most newspapers are actually still profitable on an operational basis, but aren't making enough to repay the debt. The problem was poor management thinking in believing that leveraging their futures to ridiculous levels made sense.
• Without old school newspapers, government corruption is not well covered. This one remains to be seen, but there is growing evidence that it, too, is not true. The power of the internet has made it such that many more people can hold our governments accountable by gaining a voice and speaking out against corruption or corruptive influences. It's not fixing the problem entirely, but then again, neither did newspapers. The fact is that it's much easier now to call attention to corruption, and there are more and more forums to help with that -- such as Wikileaks, combined with the ability to self publish or more easily contact those with a larger audience.
• Putting up a paywall will somehow fund more journalism. Again, remains to be seen, but there's little evidence to support this claim. There are numerous competing offerings providing news in the marketplace today. There is little indication that enough people are interested in paying directly for news to the level it would take to support news operations. Combine that with the decrease in ad revenue (the real source of revenue for most news organizations) from cutting off a large chunk of an audience, and it seems likely that these paywalls will actually serve to decrease overall revenue over the long term rather than increase it. It's not clear how that helps anyone.

On the whole, if one were to grade this professor's analysis, you'd have to give him a failing grade for basing an argument on outright falsehoods and unsupported statements.

Filed Under: democracy, free, free content, journalism, paywalls, tim luckhurst

That Mythical 'Information Wants To Be Free' Crowd

from the help-us-out-here dept

Jay Rosen is doing a brilliant job highlighting the rather silly trend among folks who think they're "debunking" the economics of free to build up complete strawmen often identified as "the information wants to be free crowd." However, as Rosen notes, none of those critics ever links to anyone in particular or defines who they're arguing against or what it is they actually said. There's a good reason for that, of course. Usually those folks are arguing against a myth. They don't want to argue against the actual economics or what folks who understand where free fits into the wider economic landscape are actually saying. They want to throw up a punching bag (usually something along the lines of "everything must be free!") which they can knock down without anyone punching back. But that's not because they're right, but because they're arguing against a myth. No one claims everything (even information) must be free. Most (and in this group I include folks like Kevin Kelly, Chris Anderson, Stewart Brand and others) are simply pointing to the basic economic forces on information. If you don't understand what those forces are, then you will be overwhelmed by them. But simply claiming that any one in that group is saying that everything must be free is flat out wrong.

Filed Under: chris anderson, economics, free, kevin kelly, stewart brand, strawmen

In Going Free, London Evening Standard Doubles Circulation While Slashing Costs

from the but-free-doesn't-work!! dept

In October, we wrote about how, just as Rupert Murdoch and crew look to put up paywalls for online content, the operators of the London Evening Standard were going in the other direction and making their physical paper free. So, how's that been working out? mowgs alerts us to the news that the paper has doubled its circulation in just a month. Not bad. But what's more interesting is that it's also slashed its distribution costs massively. It used to cost about 30p, and now it's just 4p per paper.

This actually brings up a point that's rarely talked about in the free vs. paid debate. Charging can be expensive. It takes quite a bit of effort to charge, to take money, to manage the money, to set up the accounting and bureaucracy for managing each transaction. And, even worse, if you're working with third party distributors, like news agents, then you have to handle financial relationships with them as well. Getting rid of the per paper price changes the economics not just on the revenue side, but on the cost side as well -- something that's rarely discussed at all. And, yes, this impacts online news orgs too. Putting up a paywall is going to prove a lot more expensive than most people think on the cost side.

Filed Under: costs, free, news, subscriptions
Companies: london evening standard

Nasty Old People, Give It Away And Pray And Releasing Movies For File Sharing

from the another-one dept

We were just talking about some indie filmmakers who were happy with the extra attention they've been getting from having their movie "leaked" on BitTorrent, and ChurchHatesTucker alerts us to another story of filmmakers embracing file sharing. This one is actually from a few weeks ago, but a Swedish filmmaker made a low budget indie film called Nasty Old People and released it under a Creative Commons license, along with a request for donations. The link is to Metafilter where there's an interesting discussion about whether or not the experiment is a "success" or a "failure." It's a bit of a mixed bag, as at the time of the discussion, the filmmaker had made back 20% of the film's budget and there were questions if it would get much higher. Thus, it was easy for some to quickly call it a clear failure.

Of course, it's not really that simple. First, I've said for years that I'm no fan of "give it away and pray" business models, which really aren't business models at all. While it works sometimes, it's pretty much a crapshoot, and never strikes me as a real business model. So, on the whole, I'm not too surprised that it didn't bring in much more than 20% of its budget in 2 weeks (though some compare it to blockbuster movies that can often make about the same % of their budgets in the early going.

However, if we compare this situation to what would have happened otherwise (i.e., if the movie were not released this way) the situation becomes a little more interesting. This was a very low budget indie film that likely would not have received any distribution at all. At best, the filmmaker perhaps could have self-printed DVDs, and would have been lucky to have sold a dozen or two. She could have tried to enter it into various film festivals, but that's quite difficult, and even then there's a pretty good chance that the movie doesn't end up actually making any money. Yet, in this case, she not only made money from donations, but the film is getting picked up and shown in theaters around the world. So, compared to that situation, things actually look better than the alternative.

On top of that, while this particular movie may have been a net loss, she could use it for marketing herself. She can go around and show the movie to others, and perhaps use that to get funding for a larger scale project or another film that's released with a bit more of a complete business model. Nasty Old People becomes marketing and a promotion for Hanna Skold. It has to be better resume filler for a filmmaker to talk about tens of thousands of people downloading and watching your film than just going in cold saying you want to make a film. And, in fact, she's already hard at work on a new film script, with many people who became fans of Nasty Old People following along and interested in seeing what the new script is like. So, as a marketing tool, it sure seems like giving this movie away has been quite useful.

Filed Under: business models, creative commons, donations, free, movies, nasty old people

Information Should Not Be Free... Says InfoWorld Columnist That You Can Read For Free

from the just-saying dept

Doug sent over a link to an angry screed by columnist Bill Snyder that bashes anyone who thinks anything should be offered for free. Want to read it? Go ahead, because it's free at InfoWorld.

And, of course, that's the problem with Snyder's analysis. It doesn't take into account the wider business model. The reason that Snyder's article is available for free is because InfoWorld has decided that it has a better chance of monetizing that content by offering it for free and selling advertising. It's other option would be to charge people directly to read Snyder's economically confused analysis -- but then no one might pay. So which makes more sense? According to Snyder, the latter.

Snyder also takes on the scourge of free WiFi, that pretty quickly showed that paid WiFi is a niche market, only working where you have limited and captive audiences (and even it is under greater and greater competitive threats). Unfortunately, his economic analysis is misguided:

News and Wi-Fi service are commodities, just like cars, housing, and food are commodities. Labor and raw materials, as well as the capital to buy them, are the essential ingredients of most any good or service we might care to own or consume. No money, no commodity -- that's a basic economic principle that the digital revolution has done nothing to change.

Sounds good, but it's wrong. Very wrong. Yes, they're commodities, but the defining rule of a commodity is that it is priced on the marginal cost, not the fixed costs. And yet, Synder suddenly thinks that while that applies to cars, housing and food... it goes away in the digital world? The only person really claiming that the economics has changed is Snyder, in insisting that digital products do not adhere to the same laws of supply and demand.

Snyder seems positively confused that free is a part of a larger business model:

I don't write for free, my editors don't edit for free, and I'll bet your IT hands don't run networks or produce code for free.

And yet, your content is available for free. Funny how that works. Why does it work? Because it makes good business sense. But, to Snyder, when this is pointed out, he gets confused and thinks that it proves his point:

I know, I know -- some of you are going to bring up open source.

Sorry, that proves my point. Open source has grown in influence and quality in the last few years as business models in the community have evolved. Not too long ago, any open source company that dared post a paid or paid-support enterprise version of its software would be pilloried. But not any more. The recession has put many excellent technologists out of work, but there would be even fewer employed if open source companies were afraid to make a profit, then plow it back into development projects and expanded infrastructure.

Just ask the open source millionaires at MySQL if they think everything they produce should be free.

Snyder figured out the wrong thing. Yes, getting paid is important, but the question is what you get paid for, and he's asking people to charge for the parts of a business that make the most sense being free -- and doesn't explain why he gets to decide what should be free and what shouldn't. The answer, really, is that none of us decides: basic economics tells us. If you have a competitive product with no marginal cost, it's going to eventually get driven to free. Whether you like it or not. And then you shouldn't whine about the evils of "free." You should instead figure out ways to use that to your advantage.

Filed Under: bill snyder, economics, free, information

Free Doesn't Mean Devalued

from the more-to-life-than-money dept

The concept of zero took ages for societies to recognize, let alone understand. Mike has explained before how it's been a stumbling block in economics for some libertarian and "free market" types more recently. People who think about economics in terms of scarcity get upset when abundance pushes price down towards zero, as if the economic equation were broken. But if you flip the equation and think of it as a cost of zero, you realize that the trick is to use as much of those abundant goods as possible, adding value to complementary scarcities for which you can charge. Zero doesn't break economics, it just requires a different approach.

But artists and other creators hit a different stumbling block than libertarians (libertarian artists aside...). Zero is a problem because they feel like their art is worthless; they aren't hung up on scarcity, they're hung up on "devaluation." We've heard it from journalists. I hear it most often from fellow songwriters. The economic theory makes them feel as though their work is just viewed as some sort of cheap commodity. The thing is, value and price are not the same. Price is monetary value, but value is so much more than money. Price is what gets driven down to marginal cost, but value factors into the demand side of the equation. Expensive things aren't necessarily valuable, and valuable things aren't necessarily expensive. I value oxygen a lot, but it seems silly to pay for the air I breathe each minute, given the abundant supply.

More importantly, songwriters who get hung up on "devaluation" confuse recordings with music. They equate the two. A recording is not the song, it's just an instance of it, and a digital audio file is just an instance of the recording. Equating these reduces music to recordings to files. As important as recordings are, there's so much more to music. When you think of a song, do you think of the recording, or a memory you had connecting with the music? Do you think of the file and how much it cost, or the emotions, people and experiences that the music conjures up? The recordings are just a means through which we experience the music. Songwriters (of all people!) should know that the value in music is so much more than the price of a recording. It's not devaluing music to give it away for free, but it can increase its value by allowing more people to connect with it, to know, love and understand it -- to value it. It's through that experience that music is valued, not price!

Ironically, the underlying concern ends up being economic -- how will we make money? A price of zero for digital audio files doesn't mean that no one values the songwriting profession, or that no one is willing to spend money on music and keep songwriters in business. Sharing digital audio files makes the music more valuable and leads to more opportunities for monetization. When you give music away and connect with an audience, the opportunity for monetization is in the associated scarcities -- access, containers, community, merchandise, relationships, unique goods, the creation of new music, etc. -- by giving people a reason to buy. Getting hung up on "devaluation" is a distraction from the opportunity -- the necessity -- to experiment with new business models.

So, can we please stop complaining that free means devalued?

Filed Under: free, music, value

Blink-182's Tom Delonge: Time To Adapt, Give Music Away For Free, Monetize Other Things

from the another-one dept

This one's from a couple months back, but I missed it at the time. Reader Amber Walker sends in this fantastic video interview with Tom Delonge of the band Blink-182 from the Guitar Center blog, where he makes many of the points that we discuss here, noting how technology has made it cheaper to make, promote and distribute music, and he thinks the big opportunity is in giving your music away for free, and recognizing that there are other things to sell, such as merchandise, but also subscriptions and other types of events. Some quotes:

The one thing I've learned is that, like any other type of art, it evolves. So if you're a business that supports a type of art, you need to evolve with the art. Now, a lot of things have happened that have made creating art a lot easier with the computer. And it's also made the distribution of art a lot easier.... What I have chosen to believe is that if you look at your band with a modern filter, your band has so much potential to have all these different elements about it. You can create all this really cool merchandise and concert/live experiences. You can create a really cool portal on your website. You can mix all these elements together and I always believe that if the tools are available, you can monetize all these other elements, and not really worry about selling the record. In fact, I believe that, you should take down every barrier and put as much music out there for free...

In my mind, the way the music industry is changing is that music is easier to make and it's easier to give away for free. And that will enable the band and the music and the art and everything to be bigger than it's ever been. It's just how do you collect that and how do you build your business...

I think the internet's a funny thing, because anything... that cuts through the noise on the internet will get found. The beautiful thing about the Western world is that all good art will get found no matter what. It just might take a little bit more time for some than others.... To try to really make a presence known, a band needs to capitvate people online first, no matter what -- it can be with a video or a film. It can be a song or a live broadcast. It needs to be something that's really clever. To do that, you should study the campaigns that work....

Of course, he notes that at the core of this is still good music. He says that you don't remember a band years later just for the marketing, but you need that to get attention, and then you need the music to live for itself, which leads to an interesting mantra:

The true art is not just creating the music. The true art is seeing how many people that music can touch in various ways. That's the art. Because you can be as artistic as you want and no one hears it and no one likes it. The true art is trying to break through the noise and getting millions of people to notice.

Sounds quite a bit like the difference between invention and innovation that we talk about, doesn't it? Nice to see yet another artist who has this all figured out.

Filed Under: blink-182, business models, free, music, tom delonge

Irony: U2's 'Free' Concert At The Berlin Wall, Blocked By A Big Wall

from the u2,-tear-down-that-wall dept

Dementia writes in to point out the rather ironic situation of a "free" concert put on by the band U2, at the remains of the Berlin Wall in order to celebrate the demise of the wall... but MTV decided to put up a big temporary barrier around the event so those who didn't have free tickets could not even see the event. Yes, they erected a special "wall" to block out a free concert about The Wall. As Dementia noted with the submission, "you're doing it wrong..."

Filed Under: berlin wall, fans, free, music, u2

Is Google Going Better Than Free On Navigation? Will That Set Off Antitrust Alarms?

from the should-it? dept

A few friends have passed along Bill Gurley's excellent (as usual) analysis of how Google is disrupting the navigation market by ditching the two big players in the space (Tele Atlas and Navteq), going it alone and also (the big news) offering its navigation info for free. Gurley points out that the truly disruptive part is that Google is actually offering mobile operators a deal that is better than free, in that they get to share in some of the ad revenue associated with anyone using the services. The point is pretty clear: those who are relying on the old business model of getting paid for navigation info are likely in serious trouble.

Of course, there are some perception issues. Plenty of companies who have tried a "we'll pay you" approach to marketing often find that it actually breeds some level of mistrust, as partners/users start wondering why, and if there's some sort of nasty catch. Google, of course, has a pretty good reputation, and ought to be able to overcome that issue. However, it does make me wonder if this will set off the Justice Department (and Google's enemies) on some silly witchhunt, claiming that this is somehow "predatory pricing." That, of course, is ridiculous if you actually think it through. The only real problem with predatory pricing is if it's used purposely to drive others out of business to then jack up prices. But Google's idea is to just give it more opportunity to make ad revenue. It's not predatory, it's just smart from a business sense. However, with so much scrutiny on Google these days, you could certainly see this backfiring.

Filed Under: better than free, business models, free, navigation
Companies: google, navteq, tele atlas