Would Steve Jobs Have Approved? Artist Offers His Apple Monologue, Performance Rights, For Free

from the it's-good-to-share dept

As sales of its products soar, and its share price continues to climb, Apple has come under increasing scrutiny because of the working conditions in the Chinese factories where its iPhone and iPad are manufactured. This has led Apple's CEO, Tim Cook, to announce recently that the Fair Labor Association will be conducting audits of Apple’s final assembly suppliers, including Foxconn factories in China.

That tension between the undeniably desirable products and the not-so-glamorous conditions under which they are made powers a monologue by Mike Daisey, entitled "The Agony and the Ecstasy of Steve Jobs," which we discussed last month, and described by the New York Times as:

a mind-clouding, eye-opening exploration of the moral choices we unknowingly or unthinkingly make when we purchase nifty little gadgets like the iPhone and the iPad and the PowerBook.

The NYT also has an interview with Daisey in which he makes clear his view that, for all the shiny-toy ecstasy Apple's leader purveyed to the world, Jobs could have done better:

This is someone who had an opportunity to transform the world with these devices and then did. He started as someone whose devices were forged out of piracy, and today it’s the most locked-down computer company in the world. As a capitalist I’m sure that it’s very attractive. But if we’re talking about him as an artist, I’d say that he completely lost track of his ideals.

Given that jaundiced view of "the most locked-down computer company in the world", it perhaps shouldn't be too much of a surprise to discover that Daisey the artist is trying to stay true to his own ideals by opening up his work to everyone, not just to download, but to perform:

after nearly 200 performances, the monologuist Mike Daisey was to release a theatrical transcript of his latest one-man show, “The Agony and the Ecstasy of Steve Jobs,” through his Web site, mikedaisey.blogspot.com. It will be free to download and in a rare twist, if an aspiring performer should want to mount a production of the show, Mr. Daisey will not ask for payment.

Rare indeed. Given Jobs' allergic reaction to letting people 'do what they want' without significant limits or tollbooths, would he have approved?

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If People Like You And Your Work They'll Pay; If They Like Your Work, But Don't Like You, They'll Infringe

from the cthulhu-saves-your-games dept

With the massive success of Double Fine's Kickstarter campaign (which has passed quadruple what it asked), a lot of people are commenting about just what it means to be successful in today's digital climate. Among those talking are indie game developers who are taking the time to reflect on this phenomena and how they might be able to duplicate it for themselves. One of these indie developers is Robert Boyd, the creative mind behind retro JRPGs Breath of Death VII and Cthulhu Saves The World. After a series of tweets on the topic of Double Fine's success, Robert closed with this profound statement:

If people like you and like your work, they'll buy your games. If they like your work but don't like you, they'll pirate them.

The first half of this statement is at the heart of the idea of connecting with your fans. Part of this ability to connect with your fans is to be more open and human with them. We have seen repeatedly how artists sell more of their work and scarcities associated with their work as they become more human to their fan base. As fans come to trust you and feel that they can approach you directly, even if that is through email, Twitter or Facebook, they will be far more likely to trust you enough to part with their money. This trust is one of the keys to Double Fine's success and a key to the success of any game developer. Similarly, it was seen in the way Louis CK treated his fans.

The second half of this statement is a lesson that many larger publishers, developers and others in the entertainment industry have forgotten. Because of that, they are suffering the fallout. DRM and other methods that show how little the developer or publisher trusts its fans breeds contempt within the fan community. While those consumers may still like the product, they don't like the way they are treated. This is one of the driving factors behind piracy. To top off the problem, these creators and gatekeepers set up walls between themselves and their fans. They do everything to avoid contact with fans outside carefully orchestrated scenarios. This turns fans off and decreases the amount of trust they have for these individuals and companies.

It's often said that people will just get stuff for free if they can. But, clearly, that's not true. We've seen so many cases of content creators being supported by their fans at tremendous levels (such as the two cases mentioned above) that there's clearly more to it. And it seems that a key element is whether or not fans actually like you. Some people suggest that the disconnect with piracy is that people value the work, but won't pay for it. But a more accurate realization may be that people value the work... but don't value the creator if the creator doesn't value them. When the two sides value each other, it seems people are more than willing to pay.

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Why Music Is Not A Product & Three Reasons Why That's A Good Thing

from the check-your-assumptions dept

Perhaps the biggest illusion in content-centric industries is the belief that the content itself is the main product. For the end-consumer, music is not a product or a service. End-consumers rarely pay for music. They put down money for copies of music, such as CDs, sheet music or music downloads. They put down money for tickets to live experiences. They put down money for subscriptions to music services. Those are all products, but music itself is not. Arguably, the only way to directly 'pay for music' is through commission or donation.

So what is music, or any other type of content? It's what adds value to the CD in the box. It's what makes 2 covers separated by a stack of paper worth buying from the book shop. It's what brings hundreds of people to one place for a shared experience. But it's not a product.

For people that have effectively programmed their minds to see their content as a product, this might be an uncomfortable revelation. Yet while uncomfortable, it can also be very empowering and here's why:

• Digital-proof. For a long time the music industry 'got away' with believing that the content is what people buy. However as music went digital, an increasing amount of people were able to separate the content from the product; thus leading to an uncontrollable proliferation of the content through unauthorized networks. Understanding that music ≠ the product fully acknowledges the digital reality, which is the first step to finding viable alternatives for products.
• Flexibility. Understanding that music is not the same thing as the product which creates the financial reward is a great way to rethink the products that are created surrounding your music. Music is neither a CD nor a download. It can add value to anything. Some people actually create content around physical things to make them more valuable and easier to sell (it's called Significant Objects).
• Fan-centrism. Separating product and content means you no longer have to sell fans what you want them to buy. You can sell them what they want to buy and let the music add value. By understanding who your most avid fans are, you can provide them with something they'll be happy to spend money on. Example (oversimplification alert): got hipster fans? Sell subscriptions to exclusive content via an iPhone app. Got teenage girl fans? When doing a live show, give them a number to send a text message to for an x amount of money & give them exclusive backstage content from the show when they return home. You can do anything; just understand your audience by being connected with them and realize that it's not the content itself that's being sold.

This way, everybody wins. The fans win, because what they pay for is more relevant to them. The artists win, because not only do you have increased chances to monetize, but you will also create a stronger connection with your fans by giving (or selling) them what they want.

Some great, classic examples of artists & labels that 'get it' are:

• Nine Inch Nails' Trent Reznor (Mike's case-study on Trent Reznor & the formula for future music business models);
• Younger Brother & Twisted Music (Case Study: How Shpongle Went From Yelling At Fans To Embracing Fans);
• Cee-Lo Green (uses his content to make himself & his endorsement the scarce good);
• Dave Matthews Band (particularly the fan club and the emphasis on merchandising).

In short, the value of the products you sell can be raised dramatically by attaching your content to it. Your content is valuable, but for end-consumers, it's not your product.

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Nothing Scales Like Stupidity

from the but...-but...-outliers! dept

An argument we frequently hear in the comments is how whatever's working for sucessful artist A won't work for artists B-Z. Whether it's Jonathan Coulton giving away his music while still making $500,000/year, Joe Konrath bypassing major publishers on his way to megabucks in self-publishing or a game developer using the Pirate Bay as a distribution system, we hear the same thing: this is all well and good for whoever's being discussed, but it's no good for anyone else. John D. Cook at The Endeavour boils down the argument thusly:

Yes, that would be the smart thing to do, but it won't scale. The stupid approach is better because it scales.

And that's it, in essence. Despite the fact that creative artists have to compete with free in this day and age, many people, even some in the creative community, still believe that this is optional. So, they lash out against any artist who has chosen to attack the perceived "piracy problem" by performing such aberrational acts as "connecting with their fans" and giving them a "reason to buy." Strange how that works.

But the arguments are always there. "This only works for X." "This artist is too small/unknown/niche/etc." If they're not running through the normal gatekeepers, it's made to seem as though every success story is yet another single example whipped up in a vacuum. Maybe the problem isn't the business plan that works, it's the outdated thinking that says that if it doesn't scale, it's not worth examining. Cook responds:

If the smart thing to do doesn’t scale, maybe we shouldn’t scale.

One size will never fit all. Get over it. Look at what works and adjust per individual situation rather than looking for the simple "Plan A" that's supposedly a be-all and end-all for every creative artist. That doesn't exist any more.

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The World Of Open Textbooks Just Became A Little More Crowded -- And A Little More Open

from the sharing-the-knowledge dept

Open e-textbooks are hardly new: Techdirt has been reporting on the pioneer in this market, Flat World Knowledge, for several years now. But a new entrant called OpenStax College is noteworthy for a number of reasons:

OpenStax College is a nonprofit organization committed to improving student access to quality learning materials. Our free textbooks are developed and peer-reviewed by educators to ensure they are readable, accurate, and meet the scope and sequence requirements of your course. Through our partnerships with companies and foundations committed to reducing costs for students, OpenStax College is working to improve access to higher education for all. OpenStax College is an initiative of Rice University and is made possible through the generous support of several philanthropic foundations.

Those foundations include the William and Flora Hewlett Foundation, probably the leading philanthropic organization in the field of open education, and the Bill & Melinda Gates Foundation. But the Rice connection is just as important as the funding.

Although MIT is known as a pioneer of sharing its courses freely online through its OpenCourseWare project, arguably Rice University went even further with its highly-modular Connexions program, which offers what it calls "frictionless remixing". The use of small learning modules, together with a permissive cc-by license for everything, allows educators and publishers to create their own courses by drawing on Connexions' material.

Given that the founder of Connexions, Richard Baraniuk, is also the Director of OpenStax College, it's hardly a surprise that the same cc-by licensing applies to the latter's textbooks. Still, that's a step beyond Flat World Knowledge, which allows textbooks to be modified, but under the more restrictive cc by-nc-sa license. Even though OpenStax College is a non-profit, and Flat World Knowledge a company, both adopt the same business model: the e-textbooks are given away, while printed copies and supplementary materials require payment -- a classic example of using abundance to make money from associated scarcities.

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How Being More Open, Human And Awesome Can Save Anyone Worried About Making Money In Entertainment

from the make-it-happen dept

I've been pretty busy traveling and appearing at various conferences over the last month, including Midem, where I released our latest research report, The Sky is Rising!. I did so with a quick ten-minute presentation about both the state of the industry... as well as the fact that the challenges for anyone in the entertainment industry can be met by being more open, more human and (most of all) more awesome:

It's basically a follow-up presentation to my 2009 presentation, which introduced the Connect with Fans + Reason to Buy formula. Either way, it was fun to be back on the Midem stage, and I was thrilled with the overall response to the presentation. I heard from a lot of folks at the show about how much they liked it and how it gave them a good framework for building out their efforts as artists or as labels. It's always fun to be at Midem and talk to people on the ground about what they're seeing in the industry as well. Two years ago, I had thought that perhaps the industry had reached the bargaining stage, but I may have been wrong (or the five stages of grief aren't really applicable here). There wasn't nearly as much talk about "evil piracy" at this year's Midem... but there was plenty of lashing out about "evil Google" and how it was to blame for everything. If anything, it seemed to be a slip back into the "anger" stage. As we've explained time and time again, this anger seems entirely misdirected.

So it was nice to see so many people at Midem respond positively to my "totally positive" message about where some key opportunities were, by having them focus on how being more awesome to fans and treating them as human really has amazing results.

Separately, while I was at Midem I also did a much more technical "Midem Academy" session that was designed to be a hands-on interactive discussion about specific strategies for alternative business models that don't rely on copyright. That session was 50 minutes long and didn't have the same "entertainment" value, as I was told I had to use their limited Powerpoint format, rather than do my typical style (as seen above). Still, I quite enjoyed that discussion, and ended up spending almost as much time as we spent in the session talking to people and answering questions after the session. For some reason a lot of people were shy to ask questions to the whole group, but wanted to chat afterwards. There was also a cool "open table" session I did at "Direct2Fan Camp" at Midem, where I got to talk with a bunch of folks who were interested in new business models. That was a lot of fun.

Finally, a couple weeks before that, I was in Washington DC for the Congressional Internet Caucus' State of the Net event, where there was a panel discussion/debate over SOPA, which was recently put online as well. That panel has myself and Steve Crocker (head of ICANN) talking about problems with SOPA/PIPA... and the MPAA's Paul Brigner and the US Chamber of Commerce's Steve Tepp defending SOPA. The panel may seem out-of-date, but it actually took place the day before the mass internet blackouts that effectively killed the bills. So, when this discussion happened, the bills (even in reduced form, without DNS issues) were still very much alive. At this point, the debate might be more interesting in a historical context, rather than a present one: Either way the discussion was also fun (and, at times, a little heated). I also found it kind of amusing that we were told that there were to be no "opening speeches," and then everyone gave an opening speech. I don't know if it's a DC thing or what, but I had to create an "opening speech" on the fly, though I tried to keep it short.

Either way, it was great to meet many Techdirt community members around the globe at these various events as well, and I hope to see more of you at future events.

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People Rushing To Give Hundreds Of Thousands Of Dollars In Just Hours For Brand New Adventure Game

from the monkey-island! dept

Whoa. After dinner, I did a quick look around the web to see if anything interesting was going on, and saw someone mention that the Double Fine Adventure project on Kickstarter had raised over $100,000 in just a few hours. I clicked to open the page, but then went off to do some other things, take my dog for a walk, tuck my son into sleep, chat with my wife, etc. Then I came back to my computer, and someone else mentioned that it had now raised over $200,000. And as I write this, it's getting mighty close to $300,000. Who knows where it'll be by the time you read this. Either way, the basic story is that popular game development shop Double Fine wants to create a new point-and-click adventure game, but says that no publisher will pay for such a thing (even though they have Ron Gilbert -- the creator of the original Monkey Island games on staff).

So they decided to go to Kickstarter. And, as a part of that project, they're also planning to create a documentary film about the making of the game... using the same filmmaking team, 2 Player Productions, who have also been working on a documentary about video game maker Notch (who you hopefully know already). But they wanted to raise $400,000. $300,000 for the game, and $100,000 for the documentary. That's still a significant chunk to raise over Kickstarter... but clearly the public thinks it's worth it. You should check out the awesome video that Tim Schafer, Double Fine's boss, put together, embedded here:

The video is quite awesome.

Separately, Double Fine wanted to offer some super premium tiers which were simply too rich for Kickstarter to handle, so they had to post them to their own website. These include the following:

Pledge $15,000 or more:
Dinner with Tim Schafer and key members of the dev team.

Pledge $20,000 or more:
Dinner and BOWLING with Tim Schafer and key members of the dev team.

Pledge $30,000 or more:
Picture of Ron Gilbert smiling.

Pledge $35,000 or more:
Undoctored picture of Ron Gilbert smiling.

Pledge $50,000 or more:
Become an actual character in the game.

Pledge $150,000 or more:
Tim Schafer (that’s me) will give last four remaining Triangle Boxed Day of the Tentacles, in original shrink-wrap.” (Limit of 1) (Holy crap, what am I thinking? I only have four of those!)

There are plenty of interesting things to discuss about all of this, but one of the key points is that this shows how content creators sometimes can read a market much better than the traditional gatekeepers. Double Fine knows that no publisher would give them money for this game because the "experts" at those publishers (gatekeepers) don't think there's a real market for them. But there clearly is, and it's all coming out thanks to the Kickstarter campaign, and this massive rush to fund the game.

I also find this amusing, coming just hours after someone was telling me on Twitter that Kickstarter was no way to fund serious development, because people just aren't willing to pay for creating new things. It appears that plenty of people disagree. Anyway, we've embedded the pledge widget below, because at the rate people are pledging, I'm sure the numbers we talk about above are likely to be out of date pretty quickly, and it seems likely that this game will far surpass its $400k goal. I'm just wondering if Ron Gilbert will ever actually smile.

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Publishing 2.0: Content Is Marketing, Profits Come From The Packaging

from the moving-with-the-times dept

Publishers find themselves confronted by a difficult dilemma at the moment. On the one hand, they might want e-books to succeed, because digital devices represent a huge new market to which they can sell their back catalogs. On the other, they might want them to fail, because e-books will cannibalize sales of traditional books, and it's not yet clear how low the price of e-books will have to go in order to avoid the kind of piracy problems the recording industry exacerbated through persistent overcharging.

But maybe publishers can have it both ways – selling high-volume, low-price e-books, and small-run, high-price physical books. As a recent feature in the Guardian devoted to the rebirth of "beautiful books" put it:

What the rise of electronic publishing has done, rather, is create a context in which the book's two distinct incarnations – as beautiful object and as a set of vaporous pixels - are linked not by "or" but "and".

This is certainly what they believe at the Folio Society. You might think that a company that has dedicated itself since 1947 to publishing exquisite editions of classic texts – everything from Beowulf to Elizabeth David's Italian Food – would be feeling glum about its chances in this new landscape. But David Hayden, the publishing director and a bookselling veteran, is feeling perky. An unabashed fan of new technology, he reckons the result of the seismic shifts in publishing will mean "fewer and better-produced books". In particular he believes in the model of the "retroactive purchase", which goes something like this. You buy an e-reader and, at a stroke, have access to thousands of out-of-print classics via Project Gutenberg. One evening, at a loose end, you download The Mill on the Floss, having always wondered vaguely what it was about. You find yourself transfixed. You love this book, you really do, and want to suggest it to your book group. So you buy the Penguin Classic edition, because it's easy to scribble on and pass around. And then, when your Mum's birthday comes around – she loves George Eliot and has been on at you for ages to take the plunge – you give her a handsome presentation copy of the book, bound in buckram and silk, the sort of thing that the Folio Society does surpassingly well.

The rise of beautiful books described in the article is a classic example of using abundance to make money from scarcity. Freely-available e-books encourage people to read a text they might not have encountered otherwise. When they discover they enjoy it, they decide to buy it in a form that enhances the pleasure of reading – a high-quality physical book.

This phenomenon is why publishers should not see low e-book prices – which are likely to come, whether they want it or not, not least because of Amazon's growing power – as the end of the world. In the digital age, where raw information can and will be copied freely, it no longer makes sense to pursue a business model based largely on selling what's inside the book. Instead, publishers should think about the unique elements of the content's packaging, which can't be shared in this way. That's exactly what companies built around open source have done, and Red Hat is now a billion-dollar business.

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Once Again, If You're Trying To Save The $200 Million Movie, Perhaps You're Asking The Wrong Questions

from the why-$200-million dept

Many years back, when discussing new business models that don't need to rely on copyright at a Cato event, an NBC Universal executive demanded to know how he could keep making $200 million movies. As we said at the time, that's asking the wrong question. It's makes no sense at all to start from a cost, and then derive back how to make that profitable. I could just as easily ask how can we possibly make $1 trillion movies in the future? The only thing that should concern Hollywood is how it can make profitable movies in the future. That could mean figuring out ways to make a profit on a movie that costs $200 million (and, certainly big blockbuster movies like Avatar sure seem to still be able to make plenty of money, despite being widely downloaded via unauthorized means). However, it might also mean making really good movies for a lot less money. Of course, we've suggested that in the past, and got mocked by Hollywood folks who seem to insist that any good movie has to cost a lot of money. That seems pretty presumptuous.

I'm a bit behind on this (the SOPA/PIPA stuff took up a lot of time), but filmmaker/actor/director/writer Ed Burns, who came to fame a couple decades ago with the massively successful indie film The Brothers McMullen, likely had every opportunity to follow the path of plenty of successful indie moviemakers: go mainstream. He could have hooked up with a big studio and been filming the latest of those $200 million bubble-gum flicks. And while Burns has appeared in a few big studio films (Saving Private Ryan), over the last few years, he's really focused on staying close to his indie roots. In fact, he's stayed so close to them, that you could argue his latest efforts are even more indie than his first film.

He filmed his latest movie, Newlyweds for a grand total of $9,000 ($2K for insurance, $2k for actors, $5k for food, transportation, and other costs) and was done in just 12 days -- but spread out over 5 months. He used a three-man crew, natural lighting, found locations that didn't require paying, and filmed with a Canon 5D camera.

Of course, he's admitted that the editing and post-production work really brought the overall budget up to about $120,000 -- but that's still an incredibly inexpensive movie. He's also focused on using Twitter to market the film. In that interview, he notes that if you connect with your fans, they'll "work on your behalf" to help you do stuff. He's distributing it using VOD, and it seems very likely that it will make a nice profit (if it hasn't already), just given the low budget, and all the buzz the film has been getting.

Of course, no one is saying that all movies should be made for $9,000 (though, I'm sure some of our regular critics will pretend that's what I'm saying). But there is an argument that lots of really great movies that would never have been made before, now have the ability to get made, distributed, watched (and be profitable!) in a way that simply wasn't possible just a few years ago. Frankly, I'd rather focus on ways to help more filmmakers be able to make movies like this, than worry about how some exec at NBC Universal defends his decision to waste $200 million on the next "reboot" of some franchise no one cares about.

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Kickstarter Helped Raise Nearly $100 Million In 2011... But There Are No New Business Models?

from the just-saying... dept

For years, we've been hearing how the new business models we talk about aren't really "big enough" or that they're just "exceptions" to the rule. Yet, every year we see more and more success stories involving those kinds of business models. Kickstarter, for example, has been quite successful building a platform that empowers exactly the kinds of business models we've described for nearly a decade -- and it has found tremendous success doing so. It just posted some stats for 2011, showing that just under $100 million was pledged into projects this year (with approximately $84 million going into projects that were actually funded).

Perhaps most interesting of all? The two areas of the entertainment industry where we repeatedly hear the loudest cries of "there are no new business models!" -- movies and music -- were the two largest areas on Kickstarter. An impressive $32,473,790.40 was pledged for films and video -- leading to 3,284 successful projects, involving 308,541 backers. For music, it was $19,801,685.21 pledged for 3,653 successful projects, involving 260,178 backers. The 2011 numbers roughly tripled the 2010 numbers, so this kind of thing is clearly growing quickly. And, remember, Kickstarter is just one company in this space, which has multiple other companies -- such as IndieGogo and PledgeMusic -- offering similar platforms.

And yet, we're told that there's no way to make money and that fans just want stuff for free? Perhaps it's time to rethink some of those assumptions...

But the really key thing here is exactly what we've said all along: new business models develop. They always do. And part of allowing those new business models to develop is letting new startups, services, platforms and tools develop to meet the needs of the market. Kickstarter clearly meets a need. Things like SOPA and PIPA make it more difficult to start such a company or build such a platform these days (which is why both Kickstarter and IndieGogo have come out strongly against these bills). Let these new services live, and watch new business models succeed (and with them, all sorts of artists and creators).

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Bandcamp Embraces Pirate Googlers, Turns Them Into Customers

from the it's-not-so-hard-to-compete dept

A common complaint from the legacy movie and music industries is that when people Google things like "watch movies online," unauthorized sources rank higher than legitimate ones (for some crazy reason, it seems like people prefer comprehensive libraries of unrestricted links over stale selections of geoblocked videos). Moreover, they complain about autocomplete terms like "torrent," completely missing the fact that those are caused by people searching that exact thing, not the other way around.

So it's great to see the people at Bandcamp doing the exact opposite and celebrating the prevalence of those dirty pirate keywords. They looked at their own analytics and noticed a lot of sales being generated by search terms that would send your average RIAA lobbyist running to Congress:

For example, just this morning someone paid $10 for an album after Googling "lelia broussard torrent." A bit later, a fan plunked down $17 after searching for "murder by death, skeletons in the closet, mediafire." Then a $15 sale came in from the search "maimouna youssef the blooming hulkshare." Then a fan made a $12 purchase after clicking a link on music torrent tracker What.CD. Then someone spent $10 after following a link on The Pirate Bay, next to the plea "They sell their album as a download on their website. You can even choose your format (mp3, ogg, flac, etc). Cmon, support this awesome band!"

That last part is another example of how Mike described Louis CK's recent experiment: be polite, be awesome and be human. CK's video was also available on the Pirate Bay, and as someone here pointed out, it spurred several users to comment with links and encourage people to buy, while others offered explanations for their decision to use the torrent. Though there can be no doubt that in both cases some "hardcore" pirates just didn't give a damn, there are far more people who just want to be polite, awesome and human and support the artists who do the same.

Bandcamp recognizes that people who search for torrents and file locker links are, at the core, just fans looking to get some new music. By focusing on serving those fans, they don't need to worry about illegitimate sources -- after all, in most cases they already provide a superior option:

We see these sales as proof that Bandcamp can effectively compete with filesharing and other free distribution platforms by a) giving fans a clear, easy way to directly support the artist, and b) offering them a better user experience. Our favorite recent example of this was an $8 sale that started with the search “milosh flac -torrent.” So here was a fan looking for a Milosh record, wanted a high quality flac, but didn’t want to have to sift through a bunch of torrent sites. And that led them right to Bandcamp, and right to putting money in the artist’s pocket. Beautiful.

Beautiful indeed. When you tear down walls instead of constantly building new ones you can actually turn search terms like "torrent" to your advantage, rather than resorting to SEO-by-lawsuit. Bandcamp is yet more proof that you can "compete with free," if you give people an attractive alternative.

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Cee Lo Green: Making Millions Even If His Albums Don't Sell

from the how-it's-done dept

A whole bunch of you have been sending in the recent NY Times article that details how singer Cee Lo Green is making $20 million this year, even as the sales of his album have been considered just so-so, based on traditional industry metrics. The article is really much more about Primary Wave Music, a music publisher/management firm that seems to totally get the economics of the music business today -- that by selling the scarce they can make a hell of a lot more money than just by selling music.

We've actually talked about Primary Wave's work in the past, in some of the things they've done to help Mariah Carey make money. And the story with Cee Lo is pretty similar: focus on selling the things you can't pirate, the real scarcities. And we're not talking (as our critics always insist) about tangible goods like t-shirts, but selling the person. Primary Wave may be positioned as publishing and management, but it's real business is marketing.

When Primary Wave took over Cee Lo’s management, shortly before the release of “The Lady Killer,” he still had a relatively low profile as a solo artist. But the company seized on the early viral success of “Forget You” to make Cee Lo a ubiquitous face.

His over-the-top performances at half a dozen award shows -- performing with the Jim Henson Company puppets at the Grammys, playing a piano that spun 360 degrees above the crowd at the Billboard awards -- proved highly successful. His television campaign for the year has also included “Saturday Night Live,” an appearance on the NBC comedy-drama “Parenthood” and his own talk show on the cable channel Fuse (“Talking to Strangers”).

Primary Wave also booked numerous commercial endorsements for Cee Lo, in traditional TV spots like a 7Up commercial that has been running since October, as well as a Web video series for Absolut Vodka and personal appearances for Duracell and Pretzel M&M’s.

And, no, this doesn't just mean complete selling out (I can already hear the critics...), but finding campaigns that match Cee Lo's personality. They note they've turned down a ton of deals that didn't fit.

Either way, it looks like Cee Lo is earning a ton of money from all of this: commercials, sponsorships, TV appearances and (of course) tons of live performances. The article notes that actual direct music sales are the smallest slice of the pie.

But the key point here is that these and many other opportunities are much more wide open to artists today, and it helps if their music is more widely known. That is, artists like Cee Lo, with the help of companies like Primal Wave, are recognizing that if you use the infinite goods -- such as the music -- to make the scarce goods (like Cee Lo himself or his endorsement) much more valuable, you can make a lot more money than ever before. And when you look at the overall market that way, you realize that there's lots more money to be made in the music industry today than ever before. The only part of the industry that's hurting is the part that was based on selling plastic discs, which has become obsolete. Everything else is booming.

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Louis CK: Over $1 Million In Sales In Just 12 Days For DRM-Free Download

from the polite,-awesome-and-human dept

As you probably recall, comedian Louis CK kicked off a brilliant little experiment in getting people to buy his latest comedy special, by being polite, awesome and human. He offered up a direct-to-fan offering, with no DRM, from his own site for $5, and he did so while being totally open about the process and his thinking, which only endeared him to more people. After four days, he had brought in over $500k, and twelve days in, he's surpassed $1 million, and he's got the screenshot from PayPal to prove it:

Once again, his writeup shows that this has been quite a success, as he admits that he's never had a million dollars suddenly dumped on him like this. Also, again, his writeup reinforces what worked about this in the first place, the fact that he's being polite, awesome and human:

So it's been about 12 days since the thing started and yesterday we hit the crazy number. One million dollars. That's a lot of money. Really too much money. I've never had a million dollars all of a sudden. and since we're all sharing this experience and since it's really your money, I wanted to let you know what I'm doing with it. People are paying attention to what's going on with this thing. So I guess I want to set an example of what you can do if you all of a sudden have a million dollars that people just gave to you directly because you told jokes.

He then explains what he's doing with the million dollars. $250,000 will go to pay off expenses related to the website. Another $250,000 is going to his staff and the people who helped work on the show. As he says "I'm giving them a big fat bonus." Then he's taking $280,000 and giving it away to a list of charities:

• The Fistula Foundation
• The Pablove Foundation
• charity: water
• Kiva
• Green Chimneys

What's interesting is he notes that he learned about some of these via recommendations people made to him via Twitter -- once again, showing that he's reaching out and connecting with fans.

Finally, he's keeping the rest for himself:

That leaves me with 220k for myself. Some of that will pay my rent and will care for my childen. The rest I will do terrible, horrible things with and none of that is any of your business. In any case, to me, 220k is enough out of a million.

I never viewed money as being "my money" I always saw it as "The money" It's a resource. if it pools up around me then it needs to be flushed back out into the system.

He also notes that he's a little uncomfortable with all the news this is making and he plans to stay quiet for a bit. Again, this highlights a few key points:

• Being polite and sounding human can be incredibly powerful. It's amazing how simple this seems, but so many things are first run through so many layers of PR people and publicists and the like that it's still pretty rare to see someone famous come across as being human. It's entirely possible that Louis is running all this through PR people and publicists before it's going live, but if so, they're doing a good job in making sure it really sounds like it's directly from Louis. If I had to guess, I'd say that's because it actually is directly from Louis. From everything I've seen, heard and read about him, this really does match his persona.
• Fans don't resent content creators for getting a ton of money. We keep hearing entertainment industry bigwigs and copyright maximalists insist that people claim that the reason they infringe is because content creators "have too much money already." But as we've seen with Louis, nearly everyone who's taken part in this is positively thrilled with his success. I haven't seen anyone complaining that he made too much money at all. Do some people complain about rich stars? Sure, but if you're polite, awesome and human, and actually connect with your fans, they want you to succeed.
• Having a charitable component is kinda cool. Yes, in this case it's after-the-fact, but it's still cool. We've shown in the past that pay-what-you-want works better with a charitable component, and I'd guess it's because it fits with the reasons that people are willing to buy in the first place.

This is a pretty huge success and shows what can be done by going direct-to-fan, while really connecting with those fans. Meanwhile, over at Step2, we're discussing why this worked, and whether or not "polite, awesome and human" are really the key three components. Feel free to weigh in...

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Louis CK's 'Experiment' Brings In 110k Sales, $550k Gross, Over $200k Net... In Four Days

from the nice-work-if-you-can-get-it dept

So that was fast. Yesterday we wrote about comedian Louis CK's experiment in direct to fan sales, offering up his latest comedy special for a simple, convenient $5 download with no DRM (and also being human and polite in talking about it). All we've been hearing since the sale went up on Saturday was about how everyone's buying it, and it appears plenty of people were curious how it was going. Louis has put up a statement explaining all of the results in pretty great detail. However, before we get to the numbers, he makes a really good point at the beginning. He points out that originally he had no plan to share the results, and that it's natural to try to hoard such information. But somewhere along the way, he realized something really important: people aren't just interested in buying his work, they're buying because they're interested in the experiment as well:

It's been 4 days. A lot of people are asking me how it's going. I've been hesitant to share the actual figures, because there's power in exclusive ownership of information. What I didn't expect when I started this was that people would not only take part in this experiment, they would be invested in it and it would be important to them. It's been amazing to see people in large numbers advocating this idea. So I think it's only fair that you get to know the results. Also, it's just really cool and fun and I'm dying to tell everybody. I told my Mom, I told three friends, and that wasn't nearly enough. So here it is.

This reminds me of Andy Richard's thoughts on transparency, and how that helps connect fans even closer. It's all something of a virtuous circle, it seems. Do cool experiments, be awesome, be polite... and be transparent. And people will want to support you.

On to the numbers. I love the fact that Louis didn't just reveal the topline revenue, but walked through the expenses as well:

First of all, this was a premium video production, shot with six cameras over two performances at the Beacon Theater, which is a high-priced elite Manhattan venue. I directed this video myself and the production of the video cost around $170,000. (This was largely paid for by the tickets bought by the audiences at both shows). The material in the video was developed over months on the road and has never been seen on my show (LOUIE) or on any other special. The risks were thus: every new generation of material I create is my income, it's like a farmer's annual crop. The time and effort on my part was far more than if I'd done it with a big company. If I'd done it with a big company, I would have a guarantee of a sizable fee, as opposed to this way, where I'm actually investing my own money.

The development of the website, which needed to be a very robust, reliable and carefully constructed website, was around $32,000. We worked for a number of weeks poring over the site to make sure every detail would give buyers a simple, optimal and humane experience for buying the video. I edited the video around the clock for the weeks between the show and the launch.

For what it's worth, Louis is pretty famous in comedy circles for his ability to come out with an entirely new "hour" of (amazing, brilliant, hysterical) content each year -- and once he's put that into a special or a video or an album, he never performs that stuff again. Lots of other comics will reuse old material or it takes them a lot longer to develop an hour of material, but as he explains here, he views it almost as if he's a farmer and this is his crop. So it definitely was a risk to do things this way, but certainly a calculated and not a particularly crazy risk.

Okay, let's jump down to the bottom line:

The show went on sale at noon on Saturday, December 10th. 12 hours later, we had over 50,000 purchases and had earned $250,000, breaking even on the cost of production and website. As of Today, we've sold over 110,000 copies for a total of over $500,000. Minus some money for PayPal charges etc, I have a profit around $200,000 (after taxes $75.58). This is less than I would have been paid by a large company to simply perform the show and let them sell it to you, but they would have charged you about $20 for the video. They would have given you an encrypted and regionally restricted video of limited value, and they would have owned your private information for their own use. They would have withheld international availability indefinitely. This way, you only paid $5, you can use the video any way you want, and you can watch it in Dublin, whatever the city is in Belgium, or Dubai. I got paid nice, and I still own the video (as do you). You never have to join anything, and you never have to hear from us again.

I'd actually argue that he did much better than he explains as his net here -- because he already admitted that the cost of production was paid for by tickets sold to those shows. So by not counting profits until he's covered the cost of production, he seems to be doubling the revenue needed to cover production. This makes the results even better than what he suggests.

And while he says that the $200k (which, again, I think miscalculates the actual bottom line) is "less" than he would have been paid if he'd simply sold the show, there are a few other mitigating factors, beyond what he lists above. He focuses on how it would be worse for the fans. But I'll take it a step further and suggest that going that path would have been worse for Louis as well. First, this isn't done yet. While there's definitely a huge spike in sales at the beginning, and it will only go down from there, I wouldn't be surprised to see a decently long tail of support here. Second, and more importantly, this whole experiment -- including the transparency here -- likely has both widened his fan base considerably (even though it was already quite large) and, more importantly, deepened their loyalty to him.

In other words, it may not make as much now, but chances are this pays off even greater sums down the road. Many of the people who found out about this and bought the download are likely now to be more interested in watching his TV show, seeing him live or purchasing future specials that he releases like this (or in new, even more creative, ways). In other words, by doing this kind of experiment, by being polite, awesome and human... and then being transparent about this, it's likely that his earning power from these efforts only grows. That's pretty cool.

Two final thoughts on this, as responses to a couple of the common arguments we hear from folks who can't get their minds past the traditional business model. First up, we always hear claims that "people won't buy stuff if they can get it illegally for free." It would seem that iTunes, Netflix and many other examples have long proven that false, but here's another example.

Second, just last week, we discussed the claim by some that people who pirate do so because they claim that "all artists are rich." I still have never heard that argument used by people who download unauthorized content, though I guess it's entirely possible that some have made such a ridiculous argument. But I actually think Louis CK's success here (not unlike Trent Reznor's success with various business model experiments) shows how off-base that is. By any imaginable standard, Louis is doing okay for himself. But, nearly every comment I've read from folks who paid their $5 (like myself) to happily download and support Louis, is that they're all freaking thrilled beyond belief that he's brought in this much cash from this experiment.

I'm sure there may be some resentful jerks out there, but as Louis himself noted, the people who chose to buy are invested in this experiment and want it to succeed. No one begrudges Louis the money he's making from all of this because we all feel he's earned it. And it's not that he earned it by locking it up, screaming about "pirates" and using a legal sledge hammer to attack fans -- but he's earned it by being polite, by being awesome and by being human. It's a lesson a lot of other content creators still need to learn.

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Humble Indie Bundle Well On Its Way To Break Sales Record

from the meek-shall-inherit-the-earth dept

A new Humble Indie Bundle is upon us. Once again, the guys who popularized the "pay what you want" model have brought it back with a whole new treasure trove of DRM-free, cross-platform PC games. This time, they have brought a number of heavy weights including Super Meat Boy and Cave Story+. While the games themselves are awesome, what makes this bundle so amazing is that it is already well on its way to breaking the sales record of the third bundle. Announced via twitter, the Humble Guys proclaimed, "We just hit 100,000 sales and $500,000 in a tiny bit over four hours!" The previous sales record was the third Humble Indie Bundle which brought in a total of $2,167,519.10 and sold 372,346 bundles. If this bundle can sell 100,000 in 4 hours, breaking that record should be a snap.

Perhaps this success is attributable to this being the holiday season and the addition of the Red Cross instead of the EFF as one of the supported charities. Or maybe in some strange way this success is a result of my 1000th tweet being a promotion of the Humble Indie Bundle. Most likely, this success is a result of a group of dedicated game developers connecting with their fans and giving them a reason to buy. That is true success. While the "pay what you want" model won't work for everyone, all developers can learn from the attitude and effort these developers put into selling their games.

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Louis CK: Connecting With Fans & Giving Them A Reason To Buy By Being Polite, Awesome & Human

from the simple-as-that dept

A little over two years ago, we wrote about how (the absolutely incredibly brilliant) comedian Louis CK had gotten some news by asking politely for some fans to take down a video from a file sharing site, noting that it was new material he was working on, and he wasn't ready for it to be seen widely yet. The request worked. Louis himself stopped by our comments to provide some more detail. Throughout the entire situation, he did what he does, and what makes people like him: just be himself -- and be thankful and appreciative, while explaining his reasoning. In that case, he noted that he wasn't against file sharing, it's just that he didn't want this work out in the world yet. He even said that once the same work is released officially on a DVD or special, he'd be fine with the original clips going back up on file sharing sites. He was also quite clear that he didn't demand anyone take down any content, he just asked politely.

Given that attitude (and given plenty of other things he's done recently) it came as little surprise that he's released his latest "live" video directly himself off his own website, for $5 via Paypal, and is offering it with no DRM or anything like that. There are download and streaming limits, which I assume are to avoid bandwidth issues. There are a few ways he might have been able to deal with the bandwidth to offer more downloads or streams, but on the whole, he appears to be doing everything he can to make the process as simple and convenient as possible. He even put up a short note about file sharing on the page:

To those who might wish to "torrent" this video: look, I don't really get the whole "torrent" thing. I don't know enough about it to judge either way. But I'd just like you to consider this: I made this video extremely easy to use against well-informed advice. I was told that it would be easier to torrent the way I made it, but I chose to do it this way anyway, because I want it to be easy for people to watch and enjoy this video in any way they want without "corporate" restrictions.

Please bear in mind that I am not a company or a corporation. I'm just some guy. I paid for the production and posting of this video with my own money. I would like to be able to post more material to the fans in this way, which makes it cheaper for the buyer and more pleasant for me. So, please help me keep this being a good idea. I can't stop you from torrenting; all I can do is politely ask you to pay your five little dollars, enjoy the video, and let other people find it in the same way.

Once again, as he did a couple years ago, it's a polite and friendly request, not a demand or any sort of threat or anger. On top of that he explains his reasoning. In both cases, he comes across as being human, which all too often doesn't happen with stars.

To market this release, he hit the perfect target audience for this thing, doing a Reddit IAmA discussion (basically a Q&A for those unfamiliar with Reddit). Once again, throughout that discussion he was... incredibly human, and he answered a ton of questions. Not surprisingly, it's a really fun and interesting read.

Sometimes, when we talk about business models built around CwF+RtB (Connecting with Fans plus a Reason to Buy), people seem to falsely assume that means you absolutely have to give away all your content for free. We've said time and time again that that's simply not the case at all. If you can really connect with fans, and then make it convenient and reasonable for them to support you, they will do so (as I did). And that's exactly what Louis has done here.

I don't think anyone doubts that the film will end up being available from unauthorized sources. It may already be available that way. Hell, I'd bet that Louis himself expected it to show up for free pretty quickly. But the point is that the people who still "pirate" the video really don't matter. Those people were never going to pay anyway. What Louis has done, this way, is give tons of people (including plenty who normally don't pay for content) a really good reason to buy: which is by being polite, awesome and human. Compare that to so many who are rude, mediocre and programmed.

He seems to recognize this directly in some of his comments, where he notes that he went to The Pirate Bay for the first time the day before the release, and tried to think about what to do:

I don't know yet if I'll do it again. It hasn't run it's course. But I AM SO HAPPY I DID IT. Just so fun and it has been massively gratifying to share the positive of it with so many people who have written and expressed their feelings.

The day before I posted the video I went on pirate bay, which i had never visited and i read the guy's thign where he posts letters from media co's and artists and then his nasty and kind of hilariously chest beating responses. I thought "jesus. This guy is a piece of work. I would NEVER tangle assholes with this guy." and then I thought about it. What do I say to these people? To hope they don't make me regret putting it out there naked like this? So I wrote that little "to torrent" letter, just being a guy saying "dude. please?" it's the best I can do. If it doesn't work, well.

I've talked a few times now about reasons to buy, but the more and more we see success stories, I tend to think the simple list I have above is really a key point. Being polite, awesome and human takes you a hell of a long way towards both being able to connect... and giving people a reason to buy.

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The Book World Is Changing: Mark Cuban Creates A Best Seller Out Of Some Blog Posts

from the catch-up-with-the-times dept

A few folks have sent over this great interview with Mark Cuban discussing the fact that he has a best selling book on his hands, one that was put together quickly, mostly from old blog posts, sold as a $2.99 ebook online, with Mark handling most of the promotion himself. There are a bunch of things in the interview, but what comes across loud and clear is just how obsolete the old way of publishing is these days. In an era where it still takes years for books to come out, and almost a year between an author handing in their final version and publication, Cuban tells a very different story:

Of all your business ventures, the profit margin for this book is unmatched. Much of the book already had appeared as blog posts, and the production, promotion and distribution costs were negligible ...

Yes. That is what made this approach so appealing. I didn't have to spend a ton of time writing and editing, and Scott Waxman at Diversion Books was very accommodating in allowing me to make edits, literally up to hours before the book was released.

More importantly, I didn't have to commit to doing a book tour and a rigorous interview schedule because I controlled all the economics. I try to always be a good business partner. If a publisher had made a big investment in me, I would have felt immensely obligated to make sure they made money.

Instead, I can work to my schedule and work almost exclusively from my phone and laptop to do all the promotional work.

Before anyone says anything, we're certainly not saying that just anyone can do what Mark did. Given his fame, success, reputation and following, all of that played into the level of success here. And he's willing to admit that. But that doesn't mean that there aren't key lessons here for the publishing industry. The idea of being able to produce smaller books, much more quickly is really quite appealing. And the legacy publishers still just aren't getting it.

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The Value Is In The Relationship, Not The MP3 File

from the some-data-on-pay-what-you-want dept

We've written a few times now about the band Uniform Motion, who has been extremely transparent with their latest release, such as explaining how much they make from different streaming platforms. Andy Richard, from the band, has also been quite active over on our Step 2 platform, and recently shared the results of a survey the band did of fans after they experimented with "pay what you want," including his own analysis of what the results mean. Here's just a snippet:

5. What made you decide to download the music?

I wanted to sample the music before buying a CD/Vinyl: 28%

I wanted to sample the music before paying for the MP3’s.: 22%

I wanted to own the music but couldn’t afford to pay for it: 22%

I don’t really know. I just clicked the buttons!: 19%

I wanted to own the music but I don’t think music is worth paying for: 4%

I wanted to write a review about your music: 3%

6. Do you have any idea how many times you have listened to our album(s)?

More than 5 times: 45%

2-5 times: 30%

More than 50 times: 15%

Once: 7%

I have no idea: 3%

I didn’t even get past the first couple of songs, you guys suck! 0% (thankfully!)

7. What made you decide to pay for our music? (multiple responses ok)

(Only people who had made a purchase were asked this question)

I wanted to support the band: 100%

I wanted to own the music: 61%

I wanted to own a tangible version of the album (CD/Vinyl): 61%

The key take aways are summarized here:

People who buy music do so to SUPPORT you.

So the interaction with fans is key. In today's business, you need to 'deserve' people's support and just making good music is not quite enough.

The value is in the relationship not the MP3 file.

We keep hearing from critics that the music is the "only thing of value" that a musician really has to offer as an argument for why any business model should be solely focused on selling music. But, as we've explained over and over again, that's not accurate at all -- and Andy's summation here encapsulates what we've been trying to say for years much more simply than we've ever said it. None of this means the music doesn't matter. The music absolutely matters, and the relationship is only built if the fans like the music in the first place. But the real value isn't in the mp3 file... but in the relationship.

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Free To Play Video Game Makes Over $2 Million Selling Just One Item [Update: Or Not]

from the damn dept

For whatever reason, some people falsely seem to think that part of what I argue is that no one should ever try charging money for digital goods. Nothing is further from the truth. I have said over and over and over again, the important thing is figuring out what it makes sense to charge for, and what it doesn't make sense to charge for. The problem we have is when people just assume that because they put a price on it, that's the right price. On top of that, those who charge without recognizing the potential pitfalls of charging for things in certain situations shouldn't complain when that effort fails. But if you do it right, you can absolutely charge for certain digital things -- and, in fact, many of the examples we point to of success stories involve charging for digital things.

Aaron DeOliveira points us to another fascinating example, involving the free-to-play online video game, DarkOrbit. Within the game, there's a special item, known as the 10th drone -- or the Zeus Drone -- that is highly desirable. As you might imagine, to get the 10th drone, you first have to get all 9 previous drones... and some blueprints to make the 10th drone. Apparently, this is quite involved. BigPoint, the company behind DarkOrbit, also tried another tactic: the company has run an occasional promotion, where you can buy the 10th drone for 1,000 euros (~$1,330). Here's the amazing part: apparently two thousand people paid, bringing in about 2 million euros, or $2.7 million. For a single digital item. Update: Or.... not quite. A clarification makes it clear that it did not bring in that much. People did buy, but they had to buy with in-game currency. You can sometimes buy such currency... and sometimes it's discounted. If it wasn't discounted and you had none in the game... then the cost of the drone would have been 1000 euros. As that's not likely to be the case, while the game did still sell 2000 such drones, it was clearly for less money. However, it is still an example of where people can be willing to pay if done right... just not as amazing.

But the real key here is in what they did to make this possible. First, used "free" to get lots of people in the door, connect with them, and make them totally bought into the game, such that they'd be willing to spend. Then, build up the overall "value" of such an item, and then offer it in a way that people really wanted to buy even at what many of us might consider to be an insane price. However, it's a perfect example of how if you really connect with fans, and carefully figure out what it makes sense to charge for... you can do quite well.

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Any Suggestions For Those Just Starting To Experiment With 'Free'?

from the and-pay-what-you-want dept

Over at our Step2 discussion site, musician Drew Stephenson shares the story of how he's about to start experimenting with a "pay what you want" model for his music. Through a series of events, he has a professionally produced album, where he owns all the rights (the label he was with shut down and let him do what he wants with the music). However, he's asking for some ideas/suggestions on things to do as he kicks off this experiment. Head on over and share your thoughts.