We've written about Dan Pink's last work, Drive before. It's a fascinating book that explores some counterintuitive concepts about how money incentivizes people. His new book, To Sell is Human appears to build on these concepts, as it specifically relates to salespeople (who many people assume are only incentivized by money). An HBR article appears to summarize the thesis:

Some things in life we know are true. The sun rises in the east and sets in the west. A body in motion will remain in motion unless acted on by an outside force. And the best way to motivate salespeople is by offering them commissions.

But what if we’re wrong, at least about that last one? What if paying salespeople commissions is rooted more in tradition than logic? What if it’s a practice so cemented into orthodoxy that it’s no longer an actual decision? That’s what a handful of companies have begun discovering. To the surprise of many, these firms are showing that commissions can sometimes do more harm than good—and that getting rid of them can open a path to higher profits.

Either way, it should come as little surprise that Pink is also trying unique ideas for the selling of his own book, including recruiting a "launch team" made up of 96 people who promise to share the ideas in the book (and, no, I'm not a part of that). He's offering up "rewards" for people who are willing to do this:

• Advance galley copy of To Sell is Human – there’s only a couple hundred of these ever printed.
• Signed 1st edition hardcover of To Sell is Human.
• A public Thank You on my blog along with links to your website and Twitter.
• Exclusive access to me – and each other – via a private Facebook group.

It's that last one that I find most interesting. It's not all that different than some of the offerings we've put together for people on Techdirt as well, who wish to support the site, and can get greater access in exchange (which has been really fun in practice!). It will be interesting to see how well this works (and hopefully Pink will report back on the success or failure of the program as it goes on).

What do people have to do in order to be included? Well, first they have to apply (and applications close tonight at midnight eastern) and be chosen. But then, it's pretty straightforward:

• Spread the word about the book on your platform during the weeks before and after publication.
• Leave a short, honest review of To Sell is Human at Amazon.com or BN.com on December 31.
• Join us in the Facebook group to brainstorm and share ideas on how we might spread the word about To Sell is Human.

I would imagine that, under current FTC rules, anyone in this program would actually need to disclose their participation in the program whenever they talk about the book -- which hopefully Pink is telling those who sign up for this. I also wonder if those who don't get "in" to the program will walk away feeling negative about it. Hopefully not. Either way, it's an interesting experiment and hopefully he'll share how well it works. I've always been a big fan of "access" to content creators as a possible unique form of "reward" -- and it's the kind of experience that can't be copied, which is what makes it so valuable.

As the legacy of Louis CK grows, as does his fanbase and his ability to get the closed to be more open, it's worth noting that comedians have long existed on the edge of the IP world. While some comedians will occasionally pull out the copyright card, accusations of joke-stealing and copyright infringement of their acts haven't found the same hold as in music and movies. There is a great deal of borrowing and tweaking going on in the joke world and yet the comedy business is still around.

Now we can add another comedian to the list of folks who just don't see infringement as a problem, and think of the internet as a boon rather than a threat: Doug Stanhope. In an interview with Wired -- which is hilarious enough to be worth reading the entire thing -- the former Man Show frontman took on the notion that piracy is harmful.

The internet has done nothing but good for comedy all around. Comedians no longer have to rely on TV execs and club owners deciding if they are funny or not. There’s the problem of piracy if you think it’s a problem. I credit piracy with getting my name known enough to have a decent career. People bootlegging shows on cellphones and putting material out before it’s finished is a problem for every comic, but compared to all the upsides of what the internet has done, it’s a fact of life that we’ll learn to adapt to even if it means finding these people and killing their families in front of them.

Now, I'm at least 75% certain that the last bit about killing families for infringement is a joke, but his larger point is a gem. When we, all of us, think about what we want the internet to be, it is important for us to weigh the sum total of its impact. If I may extrapolate on Stanhope's statement, I would argue that this completely undermines the view the piracy and/or sharing must be stamped out on simple moral grounds. We've all heard the "but piracy is just wrong!" arguments (or, heard that in substitute of an actual argument) but that's nonsense. Piracy, infringment, and sharing would be wrong if there were a net-negative impact on the works being infringed upon or shared. If there is a net-benefit to those people, as Stanhope suggests there indeed is, how in the hell could that be morally wrong?

Further on that point, while some may argue that it is still wrong because the infringers are not respecting the wishes of the artist, look at how Stanhope frames it: Piracy is a problem if the artist thinks it's a problem. Bootlegged shows and uploads may present challenges and problems, but they are going to adapt. It seems to me that it is every bit incumbent upon artists, be they comedians or musicians, to change their frame of reference as it is on the internets denizens to respect the artist's wishes.

One of the false impressions our frequent detractors seem to pick up from the stories covered here is that Techdirt hates middlemen. This couldn't be further from the truth. Mike Masnick has often stated that middlemen can be extremely useful. The problem is, most middlemen aren't. Most middlemen in disrupted industries continue to stake a claim to territory that is no longer theirs, insisting that their presence is still needed, or at the very least, that they be paid their tribute regardless of their actual worth. In essence, they attempt become gatekeepers, something no industry truly needs.

Nate Hoffelder sends over a story highlighting the difference between useful middlemen worth their pay and position and middlemen whose claim to a slice of the pie is solely based on an overestimation of their own indispensability. Jim McCarthy, a literary agent for Dystel & Goderich Literary Management, gives his account of a recent writer's conference, one in which several agents fiercely guarded their disappearing territory.

A week and a half ago, I had the opportunity to go to the Novelists, Inc. 23rd Annual Conference. And on one of the panels I sat on, all the growing tension and dissatisfaction came to a head...

[O]ne of my co-panelists went after someone on the panel for "denigrating" agents and said he wouldn't stand for it. So I grabbed the mic and offered, as an agent, to denigrate agents for them. I believe very strongly that good agents are incredible partners and can bring authors more success (I'll get back to this). But more importantly at that exact moment, I was just suuuuuuper pissed. It was disgusting to watch another industry professional demean an author simply because they seemed to be chiseling away at his pedestal.

That's a strange way for a group of people to treat potential clients, especially when the creation of legitimate self-publishing platforms have made the run-of-the-mill agent largely superfluous. If the agent cares for nothing more than finding a way to insert himself between the author and his earnings, then naturally he'll feel threatened by the many recent routes to success that completely bypass him.

But there are agents who actually understand that their role, and the role of the publishing industry in general, is no longer what it once was. McCarthy explains:

Here's my take. The role of agents in the marketplace is changing dramatically. At DGLM, we've always prided ourselves on being a full-service agency. In the past few years, we've been aware that what "full-service" means is changing. As authors have more access to self-publishing and more success in doing that, agents need to be able not only to guide their clients through that process, but to be aware of the pitfalls, potential gold mines, and ways to strategize that are best for an individual project but also an author's entire career.

McCarthy notes that simply because a good agent can be beneficial to authors, it doesn't mean that everyone needs an agent, especially not a bad (or simply an average) agent. However, many in his field believe the latter to be the case, even as their confidence level has shifted from "This is how to get us" to the more desperate and demanding, "You need us." Even as he spoke to several others in his same field, his message was greeted with anger and defensiveness. McCarthy's point wasn't that agents are unneeded, but that agents unwilling to accept their new responsibilities and let go of their old habits have nothing to offer today's writers.

Rather than feel threatened and become openly hostile and dismissive towards any writer that utters the phrase "self-publish," McCarthy is actively working to become an essential element of a writer's career.

What we're seeing is a balancing of power. Authors have more control of their careers and can be more demanding. Does that make my job easier? No. Does it make it more exciting? Yes. Because it's one thing to bandy the word "partner" around and make yourself sound friendly, which seems to be happening a lot. It's another thing to actually act like a partner.

Middlemen can be extremely useful, but they can't simply remain in the "middle" for no other reason than that's where they've been historically. No middleman can honestly state categorically "You need us." It simply isn't true anymore. But, if they're willing to recognize their new role in various content industries, they can be the best thing that's happened to their clients.

Yesterday, Louis CK announced the seemingly impossible: his next comedy special will air on HBO, and also be available as a DRM-free download like his revolutionary Beacon Theatre show. Yes, even the network so infamous for its tight grip on content that fans have literally begged it to take their money can't ignore the overwhelming success of CK's open, inexpensive, highly accessible approach to content distribution.

So far there aren't many details on the arrangement, except that the DRM-free option will cost $5 and be available on CK's website "a few months" after the initial HBO airing. Now, of course, this is the very definition of a "release window" and thus far from a perfect situation, but it's still an astonishing step (in the right direction) for the notoriously controlling HBO. Traditionally, the network's content has only been available to cable subscribers or, much later, on physical media and in major digital media stores like iTunes — despite countless fans asking for an affordable, timely standalone digital option.

As we have often said, there is still lots of room for the traditional "middlemen" of the entertainment industry if they act as enablers and not as gatekeepers. While HBO is still keeping the gate by windowing the release, this move shows that they may be beginning to recognize the change in their role: they are highly experienced at producing comedy specials and can do a lot to enable even the most talented and self-sufficient comedians — but they wouldn't be able to strike a deal with someone like Louis CK if they insisted on having total control over the final product, since he's already clearly demonstrated that he doesn't need them for that. Indeed, if you compare this to Trent Reznor's new non-traditional label deal, it seems like we are seeing the beginnings of a trend: artists who have struck out on their own and succeeded are now bringing the lessons they've learned back to the big gatekeepers, and using their cultural clout and their proof-of-concept experiments to change the way business is done. That's encouraging, and exciting — for all the protestations from industry incumbents that they are trying to save artists, it may end up being smart artists who save the incumbents.

We recently wrote about textbook publisher, Flat World Knowledge, changing its business model and getting rid of its free access to textbooks, something it had initially promised it would never do. The final line of our post noted that this hopefully opened up the opportunity for other providers to step in and figure out new ways to be disruptive in the textbook field. We were then contacted by Thomas Madsen, who runs Bookboon, which offers up free ebooks, including textbooks, business books and travel guides -- and then monetizes them with advertising. He notes that, not only is business going well, but they will continue to make sure that the books remain free for students. Obviously, people get a little squeamish about advertising as it relates to education, but Bookboon deals with that by focusing on a specific kind of advertising: job advertising, which students would obviously find quite useful rather than annoying (and they make sure that there isn't too much advertising). And, together, it works as a business model:

That our model is sustainable and that students and professors like our product is best illustrated by the fact that our traffic has grown on average 100% per year since 2009. This year 40,000,000 ebooks will be downloaded from bookboon.com.

This growth we have financed by retained earnings only. We have not taken in outside investments, which otherwise has been the standard when someone wants to offer free education material, and still most of these have had to give up on their original vision to survive. Because we are profitable and independent, we will be able to continue to grow our business in the coming years and provide free textbooks, to the benefit of all students.

Some tried to take the story about Flat World Knowledge and argue that it proved that "free" didn't work. But, as we noted, all it proved was that how Flat World Knowledge implemented it as a part of a business model did not work for them. Others, using "free" in other ways as part of a complete business model, are figuring out how to make it work, and Bookboon appears to be a good example of that in action.

This is certainly not the first time that we've tried to make this point, but it always amazes us how little people understand price elasticity, and the idea that a lower price can make you more money by increasing the quantity sold significantly more than the decrease in price. Instead, we hear claims by economically illiterate people about how lowering the price "devalues" the work. Of course, I've never understood how making less money devalues a work in the first place, but to each his own. Rafe Needleman has yet another story of how lowering your price can make you more money, playing off an older story he wrote, in which he was convinced by the developer of the ShareMouse app that people should be paying more, not less, for apps.

ShareMouse is $25, and Rafe thought it was too expensive, and suggested that the developer would make more money by lowering the price. But the developer, Gunnar Bartels, pushed back and convinced Rafe otherwise. First he argued that his product was better than the alternatives. Second, that lower price would lead to more support costs from less sophisticated users. And, finally, he pulled out the "developers gotta eat" card -- which doesn't make much sense if you actually can make more money by lowering the price. In the end, Rafe was convinced that perhaps Bartels had a point.

Except, now, months later, Bartels did experiment with lowering the price... and all of his arguments and assumptions fell apart.

For kicks, he offered a one-day $10 sale on Sharemouse.

“Holy cow!” Bartels wrote. Translation: He sold more licenses than the elastic pricing model predicted.

Part of the success of the trial can be attributed to the valuable marketing and promotion that came with the CNET post. Even so, Bartels says the sales figures were “overwhelming and surprising.” So he’s now planning on bifurcating the ShareMouse product line.

As for those concerns about the massive onslaught of stupid support questions? That didn't happen.

Bartels says that the expected downside of selling at the lower price, higher support expenses, has not borne out. “Maybe our product is so good,” he says.

Usually when I have the godly duty of writing about porn on this site, it has to do with a pornographic company acting (shockingly) nefarious. Maybe they're reaping millions in a judgment over a handful (unintentional innuendo) of films. Or else they're attacking speech using IP laws to silence critics of their jack-ass-ery. It might be very easy for readers to assume that pornographers as a whole (still unintentional, I swear) would be aligned against the philosophies and economics that we discuss every day. They're an easily painted "bad guy" for a host of social reasons.

But, as reader Flix alerts us, in the diverse population of pornographers, some of them do see the opportunities in the digital revolution. Such is the example of Peter Acworth (possibly NSFW, check your local listings), founder and CEO of Kink.com, who took part in a Reddit AMA. One of the first topics discussed was the impact of piracy on his business and what he plans to do about it.

Q: When its as easy as typing "the name of the movie" + torrent into google and getting at least a dozen sites that have the torrent. How do you deal with piracy of your videos?

PA: Good question!! We are investing heavily in live and social aspects of our products and then integrating them together. I.e. in the future you will join divinebitches.com, and that gets you the material, but also live shows with models, interactivity on their blogs, etc.

Note that he doesn't list off all the reasons why piracy is such a huge problem for him and his business. He just goes straight to how he's improving his business model to inoculate against piracy by supplying un-pirateable content, like live shows and connections/interactivity with models.

This is CwF + RtB at its core. Moreover, assuming the content he's supplying is of a quality that his customers enjoy, it's unbeatable. Sure, you can pirate the films if you like, but you forgoe the rest of the product. It's a wonderful response to all the boobs (okay, that one I did on purpose) shouting "you can't compete with free!"

Of course you can. Sell the customers something scarce in a way that also connects with them.

We've written about upstart textbook company Flat World Knowledge a number of times, mostly highlighting its interesting business model of giving away digital versions of its textbooks for free, while then charging for various scarcities, including printed versions. It's also done some interesting things, like creating a make your own textbook platform. However, the company has now announced a surprising about face, saying that it will no longer offer free access to its textbooks.

The company's explanation here rings hollow:

Cost partly motivated the decision, according to Jeff Shelstad, the company’s co-founder and chief executive officer. “We’ve got to be smart with the limited capital that we have” if the company is to survive 10 years from now, he said.

There’s also “an element of fairness” behind the move, Mr. Shelstad said. Some institutional partners have been paying as much as $20 to $25 per student for access to Flat World content, while other partners pay far less. The goal is to even things out while remaining affordable, according to Mr. Shelstad. “We have anchored ourselves around affordability, and we are still there with this move,” he said.

None of those arguments make much sense, frankly. The "costs" associated with offering up free access could be alleviated by putting the works on other platforms like BitTorrent. The "fairness" argument also makes little sense. If everyone chooses to opt-in to whatever level they think makes the most sense for their situation, what's the problem?

And, of course, this move goes 100% against the promise that the company made when it first launched:

Are you reading this feeling a bit jaded? Something must be coming -- some advertising, spam, a charge after a trial period, lock-in to a product, something. Breathe. Relax. It's just not coming.

Our business model eliminates the catch. We're giving away great textbooks and making them open because it solves real problems for students and instructors. In so doing, we are creating a large market for our product. We then turn around and sell things of value to that large market -- more convenient ways to consume our free book (print, audio, PDF) and efficient ways to study (study aids). Sure, we'll make less money per student than the big guys. But that's okay. We'll be selling to a lot more of them, and we'll be doing it for a lot less money (thanks to technology like web-hosted services, XML, print-on-demand, and more). Like we said... just a smarter way to do business. For all of us.

Apparently they didn't mean most of that. Makes it a bit more difficult to trust the company on any future promises. That's not to say that the company might not still be an important player in disrupting traditional textbook pricing, but it seems like it's just opened up opportunities for others to come in and focus on truly open solutions.

Brian LaSorsa points us to the news of a new joint study by Columbia and Indiana University, indicating that online readers will be slightly more accepting of paywalls if you plead the threat of bankruptcy than if you talk about profit and financial sustainability.

In the post-paywall survey, participants read one of two “justification” paragraphs, one emphasizing a profit motive and one emphasizing financial need (that paragraph concluded, “if the NY Times does not implement digital subscriptions, the likelihood that it will go bankrupt seems high”).

Participants then “rated how the information changed their support for the paywall and their willingness to pay.” The results showed that “When participants were provided with a compelling justification for the paywall — that the NYT was likely to go bankrupt without it — their support and willingness to pay increased. In contrast, when participants were provided with a justification that emphasized financial stability, their support and willingness to pay decreased.”

As we've often noted, paywalls may generate a little bit of revenue, or even brief periods of encouraging success, but they are ultimately not a sustainable business model for online news (though financial news may prove to be a rare exception to this rule). A survey like this one is rather emotionally manipulative, but by ending on that dark note of bankruptcy it demonstrates an important point: readers will only consider paying if they think, even temporarily, that they can't get what they want for free. The more the New York Times or any other newspaper retreats into the shadow of the paywall, the more competitors will provide readers with a compelling option. When they see that financial stability and quality content is possible without a paywall (something they already seem aware of, judging by this study's results) they won't be so willing to provide a financial safety net to old institutions encumbered by legacy costs.

Of course, more importantly, even these swing voters who are hooked by the sob story represent only a small portion of the overall study. Its broader results (from the full paper) are even more illustrative:

Only 7 percent planned to buy or had already purchased a digital subscription. Another 12 percent already had a paper subscription that provided online access and 16 percent were unsure of their response. Of the 65 percent who planned not to pay, 59 percent felt very certain of their response.

Results suggest that price and availability of free news sources were barriers to paying. Most participants rated the paywall as expensive (68 percent), though only 18 percent of those who planned not to pay or were unsure said it was “very true” that they could not afford it. Few (6 percent) thought the price was inexpensive, with about a quarter (26 percent) indicating the price was about right. Participants who planned not to pay or were unsure most commonly planned to stay within the free monthly limit (60 percent), switch to other news sources (44 percent), and use loopholes (39 percent).

Now, the New York Times paywall has performed somewhat better than expected, largely because it's not much of a wall at all, but a study like this just enforces the idea that it's a stop-gap solution at best—and a hindrance to smarter strategies at worst.

Recently, Extra Credits did a great episode on game demos and why no one makes them any more. The reason came down to the fact that it was really tough to make a game demo that really allowed a game to shine -- you were more likely to make a great game look terrible. In this episode, they talked about the need some people have to try out a game before they buy it and that free to play games were one way to accommodate that need. I would also add to this that piracy is another way some gamers try a game before they buy.

Just as it is important that people who play a demo get a good experience that leaves them wanting more, the same should be said of the full game itself. If your game sucks, people will stop playing it, word will spread and fewer people will buy it. This word of mouth also comes from those who pirate the game. Although they never paid the developer money, these players are still willing to speak their mind when it comes to the games that really make an impression on them. So it is still important to make a great game.

It was this last scenario, of people pirating a game and then talking about its bugs, that led one developer to take to the Pirate Bay to let those players know that a patch was coming. Jonatan Soderstrom is one of the developers behind a recently released game, Hotline Miami. After the game showed up on the Pirate Bay, people started complaining about bugs they ran into.

However, a few people had a couple of problems getting the game to run.

“Whenever I try starting the game I get [an] error,” user randir12 explained. “Error defining an external function.”

“Sometimes the game works if I click ignore, but there’s no sound.”

Instead of letting these players get help from other Pirate Bay users, Jonatan, as user cactus69, showed up himself with advice and news of a coming patch.

Hey there! I’m Jonatan Soderstrom, me and my friend Dennis Wedin made this game.

We’re working on an update that hopefully will take care of any/all bugs, and we’ll try to do some extra polish in the next few days. Would be great if you could update the torrent when the patch is out! It’d be great if people get to play it without any bugs popping up. Hope everyone will enjoy the game!

For the ‘Error defining an external function’ problem, try restarting your system and play again, it can pop up when your computer has been running for a while. We’ll try to figure out if there’s more to it than that.

While such direct contact between pirates and a game's developer is not entirely new (we have seen something like this before) it is still not the norm, and a great way to make an impression on the fans of the game. Soderstrom was able to put out a potential fire that could have led to some people to never picking the game up. In fact, this was his thought process on taking that effort. In a pair of tweets, Jonatan explained that he both understood why people might pirate, but also that it was important that they have a good experience.

I don't really want people to pirate Hotline Miami, but I understand if they do. I've been broke the last couple of months. It sucks.

And I definitely want people to experience the game the way it's meant to be experienced. No matter how they got a hold of it.

That great experience is one of the most important things any creator should work toward. It doesn't matter how much time and money you put into a game, movie, album or book. If the output does not meet the expectation of those who experience it, they will tell others. That will lead to even more people avoiding it. However, as you work toward making the best possible experience and you are completely open about faults, then people will respect you more, and often look past any flaws to support you.