quinthar edition

David Barret responds to my Sue Em All Solved post, in which I say that the Sue Em All campaign is *succeeding*:

Are you sure it’s working out well? All the troubles of TPB amount to
little more than a couple slight dips — from enormous piracy to
slightly less enormous piracy. TPB is still alive and well. … nothing has been remotely effective at reducing torrent pirating.

It’s precisely wrong to see downloads as the measure of success —
what matters is activity that could be monetized. Unauthorized
downloads don’t matter unless the downloader would have made a
purchase. The point is to extract as much money as possible from each
potential customer, not to extract money from people who aren’t ever
going to be customers.

Sell Donald Trump a gold-plated tour jacket. Sell box sets to
20-somethings who passionately love a particular band. Sell single
MP3 downloads to teens with no more than a single dollar to spend.

in what possible universe can you claim pirates aren’t demolishing
their foes in every field of battle they choose to fight? … The only battles the copyright forces are winning are Pyrrhic. They’re *masters* of those.

I know that people who read tech blogs think P2P is winning and don’t
understand why anybody would be in a business that assumes copyright
will continue to exist. This is a dream world.

Licensed content businesses are a big deal, techies.
YouTube, Hulu, Netflix, Pandora, Last.fm, Spotify, and on and on. And
awesome products from startups like Mog keep coming in wave after
wave.

Hulu
vs The Pirate Bay
:

Or note that Limewire earned on the order of $20 million a year, while
the iTunes music store probably earns on the order of $150 million –
an order of magnitude. And it will probably cost Mark Gorton far north of a hundred million dollars to settle the lawsuit. That
investment is a huge disaster, even though he had the #1 product in an
important space!

Money reshapes the economy like icebergs reshape continents.
Slowly but inexorably, value follows investment and users follow
value. Spotify’s users are there because Spotify’s investors
subsidize them. Who is investing in the Limewire of tomorrow? And
who is investing in their competition?

3 thoughts on “quinthar edition

  1. But your numbers illuminate why I say this is a Pyrrhic battle for copyright owners: the fact that an insignificant pirate outfit like Limewire is within an order of magnitude to the revenue earned by Apple on content sales is stunning. Apple is worth $240 *billion* dollars; it earns over $40B a year in revenue. For it to only earn $150M on content sales should be proof that nobody else should even bother. As a comparison, they sold 2M iPads in 2 months. Those cost $500 each, so that’s roughly a billion dollars. In 2 months, from one product. iTunes will never, ever be significant to Apple. Indeed, I believe the only reason Apple has iTunes is to distract from the fact that Apple is the major beneficiary of piracy. Nobody can argue with a straight face that people buy $30K worth of iTunes music to fill up their ever-expanding iPods; Apple *is* the largest inducer of piracy in the world. They’re just more clever about monetizing and hiding it.

  2. I could argue either position from the numbers. However, even under RIAA’s statistics, the decline in sales is from one order of billions to another order of blllions. It’s not clear that piracy is the entire reason, despite RIAA claims to the contrary. Changes in digital music delivery technology, including the price points of mp3s and the need to adjust the price point of CDs, seems to tie in there, too.

    I think that licensed content is around for a long time. The question in my mind is when will a fair regime be developed to fold the new internet technology into
    a licensed model.

    For me, I just license my content liberally, as does now thousands if not tens of tens of thousands of other hobbyist content creators. Our “business model” to
    “bring down’ the current system involves operating entirely within the law,
    creating niche networks of fans of common interests, and eschewing any effort to “take over” mass culture. In its infancy, it’s working out pretty well so far.

    I’ll become a MOG subscriber the day I can find all the creative commons and netlabel artists I can find on last.fm at MOG.

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