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<title>Techdirt. Stories filed under &quot;customers&quot;</title>
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<image><title>Techdirt. Stories filed under &quot;customers&quot;</title><url>http://www.techdirt.com/images/td-88x31.gif</url><link>http://www.techdirt.com/</link></image>
<item>
<pubDate>Fri, 29 Mar 2013 09:55:24 PDT</pubDate>
<title>Wal-Mart Wants Store Customers To Deliver Packages To Online Shoppers</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/blog/innovation/articles/20130328/16172422503/wal-mart-wants-store-customers-to-deliver-packages-to-online-shoppers.shtml</link>
<guid>http://www.techdirt.com/blog/innovation/articles/20130328/16172422503/wal-mart-wants-store-customers-to-deliver-packages-to-online-shoppers.shtml</guid>
<description><![CDATA[ Having just seen cases where legacy players have felt <a href="http://www.techdirt.com/blog/innovation/articles/20130327/02594322476/taxi-limo-trade-group-hates-innovative-upstarts-labels-them-rogue-applications.shtml">threatened</a> by more innovative startups that take advantage of more distributed "peer-production" rather than top-down centralized systems of old, it's interesting to see a counter example.  Apparently, Wal-Mart is considering a plan in which it tries to get <a href="http://www.reuters.com/article/2013/03/28/us-retail-walmart-delivery-idUSBRE92R03820130328" target="_blank">in-store shoppers to help deliver packages to online buyers</a>.
<blockquote><i>
"I see a path to where this is crowd-sourced," Joel Anderson, chief executive of Walmart.com in the United States, said in a recent interview with Reuters.
<br /><br />
Wal-Mart has millions of customers visiting its stores each week. Some of these shoppers could tell the retailer where they live and sign up to drop off packages for online customers who live on their route back home, Anderson explained.
<br /><br />
Wal-Mart would offer a discount on the customers' shopping bill, effectively covering the cost of their gas in return for the delivery of packages, he added.
</i></blockquote>
The company admits that it's just brainstorming the idea at this point, but it's always interesting to see big established companies recognizing that others have been disrupting parts of their core business, and rather than freak out about it, try to take the disruption even further.  Of course, this might serve to disrupt <i>other</i> legacy providers, <a href="http://www.project-disco.org/competition/032813-walmart-goes-startup-retail-giant-plans-to-experiment-with-crowd-sourcing/" target="_blank">such as UPS and FedEx</a>.  Hopefully they won't freak out about it, but who wouldn't be surprised to start seeing stories raising moral panics about how "dangerous" this new plan will be since the drivers won't be wearing uniforms any more?<br /><br /><a href="http://www.techdirt.com/blog/innovation/articles/20130328/16172422503/wal-mart-wants-store-customers-to-deliver-packages-to-online-shoppers.shtml">Permalink</a> | <a href="http://www.techdirt.com/blog/innovation/articles/20130328/16172422503/wal-mart-wants-store-customers-to-deliver-packages-to-online-shoppers.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/blog/innovation/articles/20130328/16172422503/wal-mart-wants-store-customers-to-deliver-packages-to-online-shoppers.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>leveraging-the-customer-base</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20130328/16172422503</wfw:commentRss>
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<pubDate>Wed, 27 Mar 2013 05:53:49 PDT</pubDate>
<title>Dumb Policy: Store Charges $5 Just To Look At Goods, To Keep People From Looking And Then Buying Online</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20130326/16500822469/dumb-policy-store-charges-5-just-to-look-goods-to-keep-people-looking-then-buying-online.shtml</link>
<guid>http://www.techdirt.com/articles/20130326/16500822469/dumb-policy-store-charges-5-just-to-look-goods-to-keep-people-looking-then-buying-online.shtml</guid>
<description><![CDATA[ It's really incredible how many <i>bad</i> strategies legacy companies come up with in trying to compete with the internet.  Rather than <i>increasing</i> their own value and figuring out ways to leverage that value, they often go in the other direction and make the experience <i>worse</i>.  Case in point, this store in Australia that is so fed up with people shopping in the store, but then buying online that it's now <a href="http://consumerist.com/2013/03/25/store-combats-showrooming-with-5-just-looking-fee/" target="_blank">charging people $5 as they enter</a> just to look around.  If you buy something, the $5 counts towards the purchase.  If you don't, the store keeps it.
<center>
<a href="http://imgur.com/sHTNWT0"><img src="http://i.imgur.com/sHTNWT0.png" width=560 /></a>
</center>
In case you can't read it, the sign says:
<blockquote><i>
    As of the first of February, this store will be charging people a $5 fee per person for &#8220;just looking.&#8221;
<br /><br />
The $5 fee will be deducted when goods are purchased.
<br /><br />
Why has this come about?
<br /><br />
There has been high volume of people who use this store as a reference and then purchase goods elsewhere. These people are unaware our prices are almost the same as the other stores plus we have products simply not available anywhere else.
<br /><br />
This policy is line with many other clothing, shoe and electronic stores who are also facing the same issue.
</i></blockquote>
This story originally got attention <a href="http://www.reddit.com/r/WTF/comments/1axk4y/when_they_open_tomorrow_im_going_to_see_how_many/" target="_blank">via Reddit</a>, and looking at <a href="http://www.reddit.com/r/WTF/comments/1axk4y/when_they_open_tomorrow_im_going_to_see_how_many/c91vgon?context=3" target="_blank">some other photos</a> it appears the store is called <a href="http://imgur.com/PHC8E6i,yVEyODy#0" target="_blank">Celiac Supplies</a>, and is a "gluten free grocery store."
<br /><br />
I can understand where the <i>thought process</i> to do something like this comes from.  For years, of course, we've heard things about how Best Buy has basically become Amazon's showroom.  But this is the exact <b>wrong</b> response.  Rather than showing ways to <i>add more value</i> to the customer experience so they <i>want</i> to come in, they're taking away value and giving customers reasons to never go in in the first place.  That's a stunningly short-sighted way of running a business.  The people who were coming in, seeing what was there and then ordering online aren't suddenly going to start paying you for stuff anyway.  They'll keep shopping online.  But, on top of that, some existing <i>customers</i> who are used to buying will be turned off by this and <i>also</i> switch to buying online.
<br /><br />
In fact, this seems to be screaming out "hey, you get better deals online and <b>we know it</b>!"  Not smart.
<br /><br />
Instead of doing that, why not look for ways to add value?  For a specialist store like this, they could create all sorts of additional value, including more support in helping customers find what they need, the ability to offer bundles and recipes, cooking classes and much much more.  The focus should be on using the local store to provide <i>more value</i> rather than taking away reasons to shop there.<br /><br /><a href="http://www.techdirt.com/articles/20130326/16500822469/dumb-policy-store-charges-5-just-to-look-goods-to-keep-people-looking-then-buying-online.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20130326/16500822469/dumb-policy-store-charges-5-just-to-look-goods-to-keep-people-looking-then-buying-online.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20130326/16500822469/dumb-policy-store-charges-5-just-to-look-goods-to-keep-people-looking-then-buying-online.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>add-value,-don't-take-it-away</slash:department>
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<pubDate>Mon, 18 Mar 2013 05:37:16 PDT</pubDate>
<title>Maxis GM: Our Vision Is More Important Than Our Customers &amp; Lots Of People Love Our Crappy DRM</title>
<dc:creator>Timothy Geigner</dc:creator>
<link>http://www.techdirt.com/articles/20130316/04473722350/maxis-gm-our-vision-is-more-important-than-our-customers-lots-people-love-our-crappy-drm.shtml</link>
<guid>http://www.techdirt.com/articles/20130316/04473722350/maxis-gm-our-vision-is-more-important-than-our-customers-lots-people-love-our-crappy-drm.shtml</guid>
<description><![CDATA[ Well, it's been several hours, so obviously someone must have done something stupid over at the <a href="http://www.techdirt.com/blog/?tag=simcity">SimCity franchise</a>. I could run through a long list of links from our coverage of this debacle, but I'll make it easy on you. The key links are the <a href="http://www.techdirt.com/articles/20130305/14551022206/launch-day-punishment-simcitys-online-only-drm-locking-purchasers-out-servers-purchases.shtml">launch</a> debacle, the <a href="http://www.techdirt.com/articles/20130307/14574822243/simcity-backlash.shtml">backlash</a>, and the <a href="http://www.techdirt.com/articles/20130314/06175522320/modder-makes-simcity-capable-offline-play-which-works-flawlessly.shtml">evidence</a> that all of this is wholly unnecessary. That last one is important because during the initial stages of this muck up, EA/Maxis came out hard, saying that offline modes were logistically impossible because of all the cloud-based resources needed to run the games simulation calculations. The evidence in the link proves rather conclusively that that is absolutely not the case. In that post, I had suggested that it was time for the game's producers to finally come out with a strong mea culpa. Here is that mea culpa, from Maxis GM Lucy Bradshaw:
<blockquote><i>
So, could we have built a subset offline mode? Yes. But we rejected that idea because it didn't fit with our vision. We did not focus on the "single city in isolation" that we have delivered in past SimCities. We recognize that there are fans &ndash; people who love the original SimCity &ndash; who want that. But we're also hearing from thousands of people who are playing across regions, trading, communicating and loving the Always-Connected functionality. The SimCity we delivered captures the magic of its heritage but catches up with ever-improving technology.</i>
</blockquote>
Okay, so it isn't so much a mea culpa as a, "Hey, customers, why don't you go outside and play hide and go f@#$ yourself!" It's difficult to imagine a more tone deaf statement, given the circumstances. To essentially come out and say that you understand lots of people wanted an offline version of this game, and we already know you could have made one quite easily, but you rejected the idea of filling a customer need because it didn't match with your "vision"? I'd suggest that if this launch has been a faithful representation of your vision, it may be time to get idea-glasses.
<br /><br />
And can I ask the other obvious question? Where the hell are all the people clamoring for online only mode? I have no doubt that there are folks who wanted and still want online components to the game, but who the hell is asking for a blatant limitation on their game?  There's a major difference between offering <i>online components</i> and <i>requiring</i> it be online all the time. Personally, I think Bradshaw is reticulating our splines on that one.
<br /><br />
On the other hand, when discussing the need for the servers in Bradshaw's blog post, there was one glaring omission: server resources/calculations. It appears the game's designers have finally decided to stop lying about <i>why</i> the servers in the cloud are needed and instead moved on to suggest that it's just a big part of their customers that are unnecessary instead.<br /><br /><a href="http://www.techdirt.com/articles/20130316/04473722350/maxis-gm-our-vision-is-more-important-than-our-customers-lots-people-love-our-crappy-drm.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20130316/04473722350/maxis-gm-our-vision-is-more-important-than-our-customers-lots-people-love-our-crappy-drm.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20130316/04473722350/maxis-gm-our-vision-is-more-important-than-our-customers-lots-people-love-our-crappy-drm.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>so,-so-much-wrong</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20130316/04473722350</wfw:commentRss>
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<pubDate>Fri, 30 Nov 2012 10:40:09 PST</pubDate>
<title>Recording Industry Could Catch More Flies With Honey, But Keeps Betting On Vinegar</title>
<dc:creator>Tim Cushing</dc:creator>
<link>http://www.techdirt.com/articles/20121127/17093921162/recording-industry-could-catch-more-flies-with-honey-keeps-betting-vinegar.shtml</link>
<guid>http://www.techdirt.com/articles/20121127/17093921162/recording-industry-could-catch-more-flies-with-honey-keeps-betting-vinegar.shtml</guid>
<description><![CDATA[ As Mike covered earlier, Ofcom, the UK&#39;s media regulator, has just released a new report on online piracy containing information it has been gathering for the Intellectual Property Office (IPO) ahead of the Digital Economy Act&#39;s eventual rollout. (<a href="http://www.techdirt.com/articles/20121126/00590921141/dear-riaa-pirates-buy-more-full-stop-deal-with-it.shtml" target="_blank">Surprise! Pirates buy lots of stuff!</a>) Andy Malt, editor of Complete Music Update (CMU) and freelance writer/copywriter for music and tech companies, <a href="http://www.thecmuwebsite.com/article/editors-letter-what-matters-in-ofcoms-piracy-stats/" target="_blank">has a look at the numbers and arrives at the conclusion that they&#39;re hardly discouraging</a>.
<blockquote>
<i>Of the 5099 people surveyed between May and July this year, 47% weren&rsquo;t able to distinguish with certainty between legal and illegal services, while only 16% actually admitted to accessing unlicensed content, and only 8% said they relied on illegal sources of music.</i><br />
<br />
<i>When those infringers were asked why they went to unlicensed content sources instead of legitimate sites or services, the most common responses were that the illegal sites were free, convenient and/or quick. Asked what would convince them to stop accessing illegal content, the three most common answers were that they would do so if legal services were cheaper and had all the content they wanted, and if it was clearer what was legal and what was not.</i></blockquote>
Malt points out that there are several legal services, most of which are inexpensive, including ad-funded streaming services which give listeners access to thousands of tracks for free. ("Inexpensive" is, of course, relative. Ofcom&#39;s study shows that music retailers and streaming services would convert a majority of casual infringers by cutting prices 50-70%. resulting in 2-3x the number of purchases.)<br />
<br />
Of course, Malt&#39;s speaking about music services in the western world. Worldwide, the situation isn&#39;t nearly as seamless. And TV/motion pictures are a <i>completely different</i> situation. While there are several services available, the content is much more fractured and more expensive. Most streaming services (Netflix, Amazon, Hulu) suffer from <a href="http://www.techdirt.com/articles/20110901/20203315773/starz-netflix-how-industry-jealousies-strangle-golden-goose.shtml" target="_blank">major studios&#39; unwillingness</a> to license their output at reasonable rates, and pricing on digital products isn&#39;t all that competitive.<br />
<br />
But as for music services in the US, it's mostly good news, even if it took much longer than it needed to get to this point. Still, Malt then goes on to point out an area where these services disappoint, often through no fault of their own:
<blockquote>
<i>The missing content point is a stronger argument, providing file-sharers relying on it really are trying to access tracks that artists or labels have failed to make available through legit routes. And this is something the music business really ought to have solved by 2012.</i></blockquote>
<a href="http://www.techdirt.com/blog/casestudies/articles/20121119/02552821089/acdc-kid-rock-finally-realize-that-selling-tracks-online-is-probably-good-idea.shtml" target="_blank">AC/DC joined the digital party</a> just within the past couple of weeks and a handful of other holdouts have chosen to stay CD-only. The list of holdouts for streaming services is much, much longer, however. But while these holdouts <i>may</i> be giving themselves a slight sales boost, they&#39;re doing so at the expense of their own industry.
<blockquote>
<i>[W]hile artists perhaps should have the power to control where their music is distributed, many of the Spotify resisters are acts who have made their millions already, and really should be thinking about the good of the wider music community. Because every artist shunning the streaming services is providing ammunition to the aforementioned self-confessed infringers.</i></blockquote>
<blockquote>
<i>The world has moved on, music consumption has changed, and the Napster generation are now at an age where they should be becoming the music industry&rsquo;s biggest customers, but that&rsquo;s not going to happen if the legit services they are embracing are lacking catalogue.</i></blockquote>
Here&#39;s where these artists make one of the worst assumptions -- that withholding their music from streaming services will result in a corresponding boost in sales. While there may be a few fans who opt to purchase rather than do without, a majority will find other options, none of which involve purchasing the album.
<blockquote>
<i>[A]n increasing number of people, when then can&rsquo;t find an album on their streaming service of choice, will not just fall in line and go buy the record from the three shops that the artist or label has dictated can sell their music.</i><br />
<br />
<i>When I can&rsquo;t find &lsquo;Red&rsquo; by Taylor Swift on Spotify, I don&rsquo;t think, &ldquo;Gosh darn it, I&rsquo;ll just have to <a href="http://www.thecmuwebsite.com/article/taylor-swifts-album-not-on-streaming-services-but-is-available-with-pizza/" target="_blank">go and buy it from Papa John&rsquo;s pizza parlour</a>&ldquo;. I think, &ldquo;Well fuck it, I&rsquo;ll just not listen to it then, cos I&rsquo;ve listened to enough sixteen track pop albums lately to know that a good chunk of it will not be very good. Also, Ed Sheeran co-wrote one of the tracks on it&rdquo;. Meanwhile those others not willing to take the financial risk of being lumbered with a handful of filler tracks will Google &lsquo;Red for free&rsquo; and download it off someone else&rsquo;s hard drive for nothing.</i></blockquote>
So, while some <a href="http://www.techdirt.com/articles/20120622/16193319442/myth-dispensing-whole-spotify-barely-pays-artists-story-is-bunk.shtml" target="_blank">artists may despise</a> the Spotifys and Pandoras of the world, withholding their music cedes ground to infringers and other artists. Even if the bump in sales is bigger at this point in time, that won&#39;t always be the case. The law of diminishing returns is going to kick in as a new generation of music fans raised on always-on internet and streaming services is just going to bypass artists that aren&#39;t available on the services they use.<br />
<br />
He then goes deeper into the numbers, looking at what it takes to convince infringers to utilize legitimate services -- and it&#39;s here that the involved industries continue to shoot themselves in the wallet. Yes, there are some people who are <i>never</i> going to use legitimate means and will <i>never</i> pay for music, movies, etc. So, why spend so much time worrying about something you can&#39;t fix?
<blockquote>
<i>OK, some of the infringers who complained about being confused may be taking the piss again. After all, most people finding content online via a search engine with &lsquo;pirate&rsquo; in its name know there&rsquo;s a very high chance the content they download isn&rsquo;t legal, even if they plead ignorance. So education probably won&rsquo;t work with this group. Then again, these are also the people who know how to hide their file-sharing from the three-strikes police, and to circumvent the web-blocks put up in front of The Pirate Bay, so there&rsquo;s probably not much you can do about them.</i><br />
<br />
<i>But remember, this was only 8% of those surveyed, so I say fuck em. Let&rsquo;s focus on the 47% who implied that they want to do the right thing, but find the whole thing too confusing. Let&rsquo;s stop handing over cash to lawyers and technology whizzes who want to go after the 8% and focus on doing some decent education with everyone else. Because if OfCom&rsquo;s research tells us anything, it&rsquo;s that the music industry&rsquo;s current educational initiatives, including the Music Matters programme, which <a href="http://www.thecmuwebsite.com/article/music-matters-launches-in-us/" target="_blank">expanded into the US</a> this week, just aren&rsquo;t working in the slightest.</i></blockquote>
If you&#39;ve got approximately 92% of the population to work with, why on earth would you spend your time trying to legislate, sue or otherwise inconvenience the other 8%? The thought process seems to be that only 0% piracy is acceptable and that accepting less is ceding the battle. Taking a hardline against file-sharing will only alienate potential customers. File sharing isn&#39;t limited to an "unlawful" fringe. A full 2/3rds of the study&#39;s respondents admitted to infringing activity, but if the content industries insist on treating customers as thieves, they&#39;re just going to end up with fewer and fewer customers.
<br /><br />
The half-assed "educational" programs are a joke as well, with most of the effort going into telling people how file sharing is wrong, rather than playing up the advantages of legitimate services (please -- no more of the "your illegal download is probably a virus" ridiculousness). Or better yet, move that time, money and energy into convincing rights holders to work with existing services to make them <i>better</i>, by adding <i>more</i> content, reducing idiotic, arbitrary restrictions that make no sense with digital goods and negotiating rates that work for everyone involved.<br />
<br />
Malt has a couple of excellent points on how to do education right. As he says, the Music Matters campaign <a href="http://www.techdirt.com/articles/20110818/12234515587/is-talking-about-beatles-as-wonderful-shared-experience-really-wise-anti-piracy-psa.shtml" target="_blank">is a farce</a>. It fails to do anything resembling "education," preferring to use guilt as negative reinforcement rather than give the undecided a reason to choose legitimate services. Not only that, but the Music Matters mark isn&#39;t even displayed by the two largest music services (iTunes and Spotify).
<blockquote>
<i>I suppose Music Matters is better that the American record industry wheeling out millionaire pop stars to complain about how file-sharing is depriving them of record sales, but it still feels decidedly mediocre for an industry that, when it comes to selling artists and albums, is actually pretty good at engaging and enthusing consumers. It&rsquo;s easy for me to sit here and criticise, and I don&rsquo;t claim to have the answers. But for a start, perhaps instead of forcing ISPs to send out angry letters to those consumers mistakenly downloading unlicensed music files, the labels could start sending thank you letters to those who inadvertently use a legal store.</i></blockquote>
There&#39;s an idea. Thanking your customers for purchasing from you rather than taking alternate routes to the same content. It would make for some great PR and maybe start altering the general image of the average record exec as a grouchy, out-of-touch robber baron with dollar signs for eyes, surrounded by lawyers and starving musicians.<br />
<br />
Education <i>can</i> be a good idea, but it needs to be handled with a much defter touch than any of the content industries seem able to manage. Think more carrot, less stick. And try to let bygones be bygones. You can&#39;t keep bemoaning the post-Napster climate when you&#39;ve got a whole new generation of potential customers who are accustomed to streaming services, low prices and instant access across multiple devices. Like it or not, streaming services and single track sales are here to stay. Ad-supported apps may not bring in great money, but that&#39;s the new reality. There&#39;s no going back, no matter how much legislation you throw at the internet. A continued preference for enforcement over engagement is only going to make things worse.&nbsp;<br /><br /><a href="http://www.techdirt.com/articles/20121127/17093921162/recording-industry-could-catch-more-flies-with-honey-keeps-betting-vinegar.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20121127/17093921162/recording-industry-could-catch-more-flies-with-honey-keeps-betting-vinegar.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20121127/17093921162/recording-industry-could-catch-more-flies-with-honey-keeps-betting-vinegar.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>chasing-8%-at-the-expense-of-the-other-92%-is-just-more-bad-math</slash:department>
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<pubDate>Tue, 20 Nov 2012 00:02:00 PST</pubDate>
<title>Micro-Stock Photo Agency Prefers Converting Customers To Cracking Down On Infringers</title>
<dc:creator>Tim Cushing</dc:creator>
<link>http://www.techdirt.com/blog/casestudies/articles/20121113/18461221040/micro-stock-photo-agency-prefers-converting-customers-to-cracking-down-infringers.shtml</link>
<guid>http://www.techdirt.com/blog/casestudies/articles/20121113/18461221040/micro-stock-photo-agency-prefers-converting-customers-to-cracking-down-infringers.shtml</guid>
<description><![CDATA[ In this bold era of <a href="http://www.techdirt.com/articles/20121009/17431520668/judge-calls-copyright-trolls-bluff.shtml" target="_blank">copyright trolling</a>, calmly (ir)rational <a href="http://www.techdirt.com/articles/20120904/22172920275/copyright-killbots-strike-again-official-dnc-livestream-taken-down-just-about-every-copyright-holder.shtml" target="_blank">takedown bots</a>, baseless <a href="http://www.techdirt.com/articles/20121112/17111021024/revenge-porn-site-owners-escalate-their-failure-going-bogus-dmca-notices-to-bogus-legal-threats.shtml" target="_blank">legal threats</a> and ridiculous <a href="http://www.techdirt.com/articles/20121025/17571420849/66-million-ruling-against-lyrics-site-once-again-shows-how-short-sighted-music-industry-is.shtml" target="_blank">statutory damages</a>, it&#39;s a true rarity to see a copyright holder deal with infringement, especially non-commercial infringement, with a reaction that&#39;s actually in line with the "crime" committed.<br />
<br />
As photo sharing increases, thanks to platforms like Pinterest and Tumblr, the chances of infringement increase. Paidcontent has the details on a <a href="http://paidcontent.org/2012/11/13/turn-pirates-into-customers-a-smart-approach-to-the-photo-problem" target="_blank">micro-stock agency that&#39;s treating infringers as potential customers, rather than criminals</a>.
<blockquote>
<i>Unlike other image owners, Dreamstime does not sic lawyers on people who like its photos. Instead the company, which claims to have more than 5 million users, responds by sending them a notice to take the image down or else to buy a license at the going rate which can be as low as $8.</i><br />
<br />
<i>According to CEO Serban Enache, this approach actually leads to better business.</i><br />
<br />
<i>&ldquo;We want to respond to copyrighted images but we want to do it in a different, non-heavy-handed way,&rdquo; said Enache in a recent phone interview. &ldquo;This is very successful way of turning unauthorized users into customers. Once they learn of the license, they often obtain larger licenses.&rdquo;</i></blockquote>
When you give infringers a logical option (take down the photo or pay a fee), most will take down the photo. If you give them the chance to license the photo for a reasonable rate, you should be able to find a few takers. The most important part of this scenario is that Dreamstime <i>gives infringers an option</i>, something most copyright holders are unwilling to do. Compare Dreamstime&#39;s method to those of other copyright holders.
<blockquote>
<i>As photos spread across the internet, bands of lawyers are springing up who offer themselves as hired-gun enforcers to image owners. When they find a target, they squeeze them for thousands of dollars and take a cut of the loot.</i><br />
<br />
<i>Major image owners like Getty possess image recognition software that lets them quickly detect unauthorized use of their images. The legal settlements they collect have become a major source of revenue.</i></blockquote>
These copyright holders are willing to imagine that a hobby blog&#39;s use of an image is somehow depriving them of thousands of dollars. Because of this irrational (but self-interested) logic, the "problem" is treated with utmost severity, resulting in demands for prohibitively expensive licensing fees.<br />
<br />
Not only does Dreamstime request reasonable license fees, but it doesn&#39;t waste time with the DMCA process. A DMCA takedown notice almost always results in the infringing content being removed, but does nothing to help the photographers earn any income. It&#39;s hard to earn money by shooting first and asking questions later. Instead, the infringer is approached directly and honestly, rather than threatened with the possibility of legal action and thousands of dollars in statutory damages. Perhaps if more copyright holders approached casual infringement this way, they might see an uptick in income, rather than alienating another set of potential customers.<br /><br /><a href="http://www.techdirt.com/blog/casestudies/articles/20121113/18461221040/micro-stock-photo-agency-prefers-converting-customers-to-cracking-down-infringers.shtml">Permalink</a> | <a href="http://www.techdirt.com/blog/casestudies/articles/20121113/18461221040/micro-stock-photo-agency-prefers-converting-customers-to-cracking-down-infringers.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/blog/casestudies/articles/20121113/18461221040/micro-stock-photo-agency-prefers-converting-customers-to-cracking-down-infringers.shtml?op=sharethis">Email This Story</a><br />
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<slash:department>sometimes-a-handshake-gets-better-results-than-a-savage-beating</slash:department>
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<pubDate>Wed, 10 Oct 2012 05:00:05 PDT</pubDate>
<title>Xbox DRM Punishes More Paying Customers And Actually Restricts Purchasing Options</title>
<dc:creator>Tim Cushing</dc:creator>
<link>http://www.techdirt.com/articles/20121006/15375020630/xbox-drm-punishes-more-paying-customers-actually-restricts-purchasing-options.shtml</link>
<guid>http://www.techdirt.com/articles/20121006/15375020630/xbox-drm-punishes-more-paying-customers-actually-restricts-purchasing-options.shtml</guid>
<description><![CDATA[ Publishers are still hanging on to DRM despite <a href="http://www.techdirt.com/articles/20120923/05265720472/why-everyone-should-care-about-drms-punishment-visually-impaired.shtml" target="_blank">example</a> after <a href="http://www.techdirt.com/articles/20120730/04291119876/ubisoft-drm-fiasco-allows-any-website-to-take-control-your-computer.shtml" target="_blank">example</a> of how it does little more than annoy or harm paying customers. Why would you purposely annoy those throwing money your direction? To fight off a few pirates? Is it worth it? Most DRM is cracked and discarded within hours of a game&#39;s debut and yet, companies hold onto the <a href="http://www.techdirt.com/articles/20120412/07212918466/another-reason-why-drm-is-bad-publishers.shtml" target="_blank">crippling code</a>, assuming that a small dent in piracy is worth the <a href="http://www.techdirt.com/articles/20120203/07550617650/ubisoft-cuts-off-legit-players-with-drm-server-migration-pirates-play.shtml" target="_blank">fallout</a> from hundreds of pissed off customers venting their rage all over the internet.<br />
<br />
Some of the most pernicious forms of DRM take the form of "online services" which require a unique login and account before <i>anything</i>&nbsp;can be done gamewise. Under the auspices of "convenience," software companies have managed to lock down access to purchased games, reserving the right to do whatever they want with the software, thanks to broadly written Terms of Service and, for console manufacturers, binding arbitration "agreements."<br />
<br />
Over at Medium Difficulty, <a href="http://www.mediumdifficulty.com/2012/10/04/xbox-live-drm-does-not-understand-the-modern-family" target="_blank">another gamer is dealing with DRM, as implemented by Xbox Live</a>.
<blockquote>
<i>The particular set up for us to play three player horde mode, with system link, in the same house led to our first transgressive living room. Two TVs was wrong, but it felt so right. Gears of War 3 came out and we continued to enjoy our set up, especially since friends could also join over Xbox Live. For our non-nuclear unit, it was the golden age of multiplayer.&nbsp;Then the Mass Effect demo dropped with included MP. While I know we might be in the minority, we found it, and still do, a pretty enjoyable experience. But we hit a hiccup: we couldn&rsquo;t split screen the multiplayer. There is no couch multiplayer for Mass Effect 3.</i><br />
<br />
<i>So we did what any reasonable modern family with disposable income would do: we bought a second Xbox. And honestly? There&rsquo;s no going back. Couch co-op is not a guarantee anymore. Xbox Live has done wonders for online console gaming, but it has made a local co-op a second priority in some instances. There are enough games that do not support local co-op, and even more that do not support both local and online at the same time.</i></blockquote>
So far, the outlay for Microsoft products, at the <i>very minimum</i>, includes two Xboxes. Then there&#39;s the fact that two avid gamers share the same living space, meaning that the outlay for software is much larger than your typical "complaining basement dweller." (The preceding is the sort of dismissive wording often deployed by DRM defenders in an effort to make a very real problem sound like some loser&#39;s overwrought drama. No one falls for it anymore, but it still makes frequent appearances in comment threads and forums.)<br />
<br />
First, the co-op problem. Not really a DRM issue, but the next one definitely is:
<blockquote>
<i>Our second Xbox came with Fable 3, which is yay! but it also introduced us to the problems of owning two Xboxes. DRM is a real pain in the ass... We would go to play our Fable 3 campaign on one machine and be told that we couldn&rsquo;t use the DLC, even though, you know, the code was in the box sitting on top of the machine. <b>Without that DLC, you cannot load a saved game</b>.</i></blockquote>
Because DLC (downloadable content -- ranging from small add-ons to standalone games) gets assigned to the Xbox it was purchased on and the player&#39;s Gamertag (which makes sense), but is a problem when attempting to make sure your DLC shows up on both consoles. Microsoft&#39;s rationale is simple: prevent users from going from Xbox to Xbox with their Gamertag and downloading DLC (and standalone games) onto the drives of non-paying gamers.<br />
<br />
But this rationale doesn&#39;t do much for households with multiple consoles who most likely aren&#39;t going to buy a unique copy of DLC (much less full games) for each Xbox in the house. Since the games can&#39;t be played at the same time (with one disc and say, two or more Xboxes), it would make sense (from the consumer&#39;s perspective) to be able to transfer the DLC (<i>especially</i> if you can&#39;t even <i>load a saved game</i>&nbsp;without it) from console to console.<br />
<br />
Also bear in mind that purchasing full games via XBLA (Xbox Live Arcade) ties that game to that particular Xbox if the "wrong" Gamertag is used.
<blockquote>
<i>For example: I purchased TellTale&rsquo;s Walking Dead Episode 1. I enjoyed it a great deal. When episode 2 came out, Meg thought she would be a kind and thoughtful spouse and purchase it for me. This was apparently not the Microsoft-endorsed thing to do. Months later, I still haven&rsquo;t been able to actually play the second episode. I have to either buy it again, or play it on another system. Which is dumb.</i></blockquote>
Thinking that these limitations could be worked around by using a Family Account (you know, to make sure all of your family members can access the same DLC/games), the author set one up only to find that Microsoft&#39;s definition of "family" is rather bizarre.
<blockquote>
<i>We set the account up under Meg, then gave me all the permissions that any adult would want on his game console, and went about our gaming business. That was until one day when I went to purchase something from Live and realized that, from Xbox LIVE&rsquo;s perspective, I was not an adult at all. I could not add points to my account. This wasn&rsquo;t a setting in our family account. Nope, only one member of the family can add points to their account. If I want points to buy something, Meg has to give me an allowance. I&rsquo;m not joking, that is the word in the interface. An allowance.</i></blockquote>
Nice. A system that treats grownups like children and everyone like thieves and at no time approaches the reality of today&#39;s gaming market. Instead, it sets up a series of intricate hoops that must be navigated before DLC can move from machine to machine.
<blockquote>
<i>Context: Meg&rsquo;s Xbox is the new version, so black, and mine is the old white one.</i><br />
<br />
<i>Prerequisite: Have both gamertags saved on a USB stick. This allows you to log in to any Xbox without transferring your gamertag or recovering it from Live.</i><br />
<br />
<i>1. Log in to black Xbox with Meg&rsquo;s gamertag.</i><br />
<i>2. Go into Family Settings.</i><br />
<i>3. SELECT GRANT ALLOWANCE.</i><br />
<i>4. Instead of using the default payment options, because I don&rsquo;t want to charge her credit card, I select my credit card from the list of her payment methods.</i><br />
<i>5. Purchase a number of points.</i><br />
<br />
<i>Info: You can add 500 points or in 1000 point increments.</i></blockquote>
Let&#39;s just break in here for a moment and roll our eyes at the "point" system which handily turns actual money into useless Xbox Fun Buxx. Further eye rolling will ensue after step 6.
<blockquote>
<i>6. After the points have been added to Meg&rsquo;s account, I grant them to my account.</i><br />
<br />
<i>Additional info: You can only grant points in increments of 400. Thanks for the convenience.</i><br />
<i>Remember: Most DLC on Xbox Live is in neither 500 or 400 point increments. I know what&rsquo;s happening here, Microsoft.</i></blockquote>
Fun stuff. This sort of plan always leaves a gamer&#39;s "wallet" either short a few hundred points or with no way to bring the account down to 0. Microsoft loves this, just like many companies love gift cards. More often than not, the card is discarded with some spare change on it. Not enough for one person to keep, but thousands of leftover virtual coins soon adds up to real money. It&#39;s not completely Machiavellian but it still works out pretty well for the companies issuing the cards.
<blockquote>
<i>7. I then sign in to my account on the black Xbox, purchase what I wanted and download it.</i><br />
<i>Result: Now, the DLC is available on Meg&rsquo;s Xbox so that she can play it if she wants.</i><br />
<br />
<i>8. Turn off the black Xbox, and then log in to the white Xbox with my account and download/transfer whatever I bought.</i><br />
<i>Result: I can play the DLC on my Xbox, and Meg can play it on her Xbox.</i><br />
<br />
<i>Please note: She cannot play the DLC on my Xbox.</i></blockquote>
That&#39;s a whole lot of steps for a paying customer to jump through just to make sure someone doesn&#39;t run off with some free DLC. If you and your family members are taking turns playing something that requires DLC in order to <i>load a save</i>, it would make more sense (in Microsoft&#39;s eyes) to skip buying a console(s) from it and just schedule some time in front of the only Xbox. That scenario is whole lot likelier than hoping its DRM scheme will be obtuse enough to force multiple gamers with multiple consoles <i>under one roof</i> to purchase individual copies for every Xbox. Microsoft may consider that to be the "right" or "moral" choice, but I can guarantee you the consumer doesn&#39;t.<br />
<br />
Last word to "CPG," the author of this piece:
<blockquote>
<i>I shouldn&rsquo;t have to set up charts to figure out what DLC is on what machine, especially when we are on a family account that <b>actually restricts my ability to purchase DLC</b>.</i><br />
<br />
<i>We&rsquo;re a modern family, geared towards gaming. <b>We&rsquo;re publishers&rsquo; target market &ndash; and if we&rsquo;re not, we will be soon</b>. They need to start thinking ahead.</i></blockquote>
&nbsp;<br /><br /><a href="http://www.techdirt.com/articles/20121006/15375020630/xbox-drm-punishes-more-paying-customers-actually-restricts-purchasing-options.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20121006/15375020630/xbox-drm-punishes-more-paying-customers-actually-restricts-purchasing-options.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20121006/15375020630/xbox-drm-punishes-more-paying-customers-actually-restricts-purchasing-options.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>fighting-bad-ideas-with-worse-software</slash:department>
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<pubDate>Fri, 24 Aug 2012 11:38:19 PDT</pubDate>
<title>MPAA Pretends 'Offering Something' Is The Same Thing As 'Offering What People Want'</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20120824/01254520142/mpaa-pretends-offering-something-is-same-thing-as-offering-what-people-want.shtml</link>
<guid>http://www.techdirt.com/articles/20120824/01254520142/mpaa-pretends-offering-something-is-same-thing-as-offering-what-people-want.shtml</guid>
<description><![CDATA[ We recently wrote about David Pogue's article highlighting how the movie industry's <a href="http://www.techdirt.com/articles/20120821/19130920119/dvd-is-dying-hollywoods-plan-do-nothing-cede-ground-to-file-sharing.shtml">failure</a> to embrace what technology allows is a huge cause of infringement, and the industry still doesn't seem to get that.  In response, in typically tone deaf fashion, MPAA spokesperson Howard Gantman has taken the usual tack of not actually addressing what Pogue wrote, but <a href="http://blog.mpaa.org/BlogOS/post/2012/08/21/More-Legitimate-Avenues-Available-Today-to-Watch-Movies-and-TV-Shows-Onlinese-than-Ever-Before.aspx" target="_blank">making an unrelated argument</a>. He says that somehow, magically, because there are more crippled, annoying, expensive, incomplete movie services out there, no one should complain.  You see, in the MPAA's world "offering something" is proof that they're innovating, even if it's not what people want.
<br /><br />
But this shows a rather remarkable lack of awareness of what customers seem to be saying.  They're saying they don't want services that only let you watch a movie for 24-hours.  They're saying that they don't want movies that cost ridiculous prices.  They want reasonable access at reasonable prices -- and the reasons some people aren't flocking to some of these services isn't that they're evil "thieves," but that they don't find those new offerings compelling.  The proper response is to <i>make them more compelling</i>.  But, apparently, in the world of the MPAA, the response is to berate and guilt people for not using their crappy offerings.<br /><br /><a href="http://www.techdirt.com/articles/20120824/01254520142/mpaa-pretends-offering-something-is-same-thing-as-offering-what-people-want.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120824/01254520142/mpaa-pretends-offering-something-is-same-thing-as-offering-what-people-want.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120824/01254520142/mpaa-pretends-offering-something-is-same-thing-as-offering-what-people-want.shtml?op=sharethis">Email This Story</a><br />
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<slash:department>and-that's-why-they're-such-failures</slash:department>
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<pubDate>Thu, 29 Dec 2011 10:32:56 PST</pubDate>
<title>Paul Christoforo Doesn't Seem To Know How To Stop Digging A Deeper Hole Of Internet Infamy</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20111229/02504317222/paul-christoforo-doesnt-seem-to-know-how-to-stop-digging-deeper-hole-internet-infamy.shtml</link>
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<description><![CDATA[ Remember Paul Christoforo?  The "marketing rep" for the Avenger gaming controllers who caused quite a stir this week by doing <a href="http://www.techdirt.com/articles/20111227/12593617206/latest-entrant-how-not-to-do-marketing-online-world-ocean-marketing-fail.shtml">just about everything wrong</a> in responding to a customer service request, and then missing no opportunity to make the situation worse at every turn -- especially after Gabe (aka Mike Krahulik from Penny Arcade) got involved.  It involved pretty much everything: dreadful customer service, false claims, anger, curses, bravado, promises that couldn't be kept, an absolute refusal to back down, and an apology for getting caught (rather than an apology for the actual actions).
<br /><br />
You might think that, after the widespread backlash and a couple days to reflect (especially after getting fired from handling the Avenger account), Paul might come back a bit more humble and with a bit more perspective on what he did.  In fact, that's exactly what I expected when I saw the headline of Kotaku's interview with him: <a href="http://kotaku.com/5871656/chastened-gaming-rep-paul-christoforo-responds-to-internet-infamy" target="_blank">Chastened Gaming Rep Paul Christoforo Responds to Internet Infamy</a>.
<br /><br />
Then I read it.  And, all I can say is that Paul doesn't seem to know how to stop himself from digging himself a deeper hole.  A recommendation: in the future, maybe just don't speak up.  Even as he <i>claims</i> to have learned his lesson, his words show that he still wants to blame others and doesn't seem to recognize why what he did was wrong.  He makes additional questionable statements, such as contradicting himself <i>in the same interview</i>.
<blockquote><i>
A chastened Christoforo is now looking for forgiveness from the Internet community he unwittingly antagonized, saying in an interview with MSNBC.com's In-Game he was "caught on a bad day" and that he hopes they will "let sleeping dogs lie."
<br /><br />
"They've pretty much ruined me in the past 24 hours," Christoforo said. "It was humbling a little bit, but life goes on. I'm not going to die."
</i></blockquote>
"Life goes on" and "I'm not going to die" are actually good mantras for getting through a tough situation, so I won't begrudge him those statements, but the overall sentiment that comes across here is that he's brushing off what happened, as if he needs to just ride out the storm, rather than fix what he did wrong.  As for that first statement, about how he was ruined... just hang onto that one for a second, because soon after that, we get:
<blockquote><i>
Yet despite all the drama, Christoforo said he hasn't lost any of his other accounts, aside from Avenger. "It hasn't affected my business yet," he said. "Clients have brought it up, but they've mainly laughed about it. I haven't lost any clients."
</i></blockquote>
Wait, what happened to him being "ruined"?  Then almost immediately after that he says it "hasn't affected" his business?  I'm curious how many of his clients actually "laughed" about it.  But really that's not the worst of it.  As the interview goes on, Paul seems to show less and less understanding of what happened here.
<blockquote><i>
"I didn't know who that guy at Penny Arcade was," he admitted. "If I had known, I would have treated the situation a little better. PAX is a great show. What he does is what I've been idlolizing since I was a kid. It's admirable he's put that together. He has a lot of connections, ones I want too."
</i></blockquote>
Who Gabe is really is kind of meaningless here.  Paul seems to be suggesting that it's okay to be a complete asshole to people so long as they're not important or don't have "connections."  But if someone has "connections" then you should be nice to them.  This certainly fits with Paul's claims during the email exchange, where he kept claiming that he had some special "connections." 
<br /><br />
As for all those "connections" he claimed?  Yeah, not so much...
<blockquote><i>
Regarding the litany of names Christoforo's e-mail called up as potential supporters - a list that included everyone from Epic Games' Cliff Bleszinski to the mayor of Boston - he said the tactic was meant to "impress, not to threaten" and didn't come through correctly because "you can't see tone of voice in email."
<br /><br />
"I don't know the mayor of Boston," he admitted. "That was taken totally out of context, I was just joking around. I am from Boston, though, and I know a lot of people people who own clubs. I know some influential people, like the guy who runs the door at the convention center.
</i></blockquote>
Saying something you wish you didn't isn't others taking something "totally out of context."  It just means you made up stuff and got called on it.  And, um, the guy who runs the door at a convention center isn't generally considered "influential."  Finally, nothing in the email suggested that naming those "connections" was meant to "impress, not to threaten."
<br /><br />
And then there's this part, in which he shows that he's not really apologetic at all:
<blockquote><i>
"He called me a bully, but he was being a bully ... especially when he emailed me out of the blue, saying 'That's f***ing s***ty, you're banned from PAX,' I was like 'Who the f*** are you? That's how you introduce yourself? ... I dont want to call him out, but he could have gone about that a totally different way, he could have said, 'Hey, I run the show, that email was a little unprofessional, if you don't do something to apologize I don't want you at my show.' But he just came at me and said, indirectly, 'Hey, f*** you, you're banned from PAX.' Is that what you'd call professional? I wouldn't."
<br /><br />
Christoforo also said his response was driven in part by what he saw as the disrespectful tone of the messages that came before it. "Not that I don't have respect for anybody, but if someone's badmouthing me or being a little punk or being a jerk, they don't deserve respect," he said. "You can't expect to go up and say 'Hey you piece of s***,' and expect respect. Send an email, introduce yourself. ... I trust everybody until they give me a reason not to respect them. I'm not a tough guy, not a bully, but at same time not going to take s*** if it's uncalled for.
</i></blockquote>
Basically he's still blaming the others in the conversation, and even suggesting that <i>they</i> should have gone about things differently.  In fact, he seems to suggest that they provoked <i>him</i> into his reaction.  At this point, it might be worth going back to <a href="http://penny-arcade.com/resources/just-wow1.html" target="_blank">the original email thread</a>, to see who started the hostilities.  The customer, Dave, was nothing but polite through a series of perplexing emails.  It's Paul who kicks off the hostilities with a totally uncalled for email that first tells Dave that his order will be cancelled if he dares to try to reorder at the new, cheaper price, and then pulls out: 
<blockquote><i>
You placed a pre order just like any software title the gets a date moved due to the tweaks and bugs not being worked out and GameStop or any other place holds your cash and im sure you don&rsquo;t complain to activision or epic games so put on your big boy hat and wait it out like everyone else. The benefit is a token of our appreaciation for everyone no one is special including you or any first time buyer . Feel free to cancel we need the units were back ordered 11,000 units so your 2 will be gone fast. Maybe I&rsquo;ll put them on eBay for 150.00 myself.
</i></blockquote>
Sorry, but I don't see how that's anyone's fault by Paul's.
<br /><br />
Then there's this:
<blockquote><i>
"Ultimately, if I was able to control the customer, it never would have happened. I've dealt with thousands and thousands of customers with similar complaints, they were all asking the same question. When is it big enough that it hits the news? When it hits Penny Arcade, when it hits a guy who has the biggest affiliations in the industry."
</i></blockquote>
He still thinks it's about <b><i>controlling</i></b> the customer, not responding to Dave's very legitimate and real requests. 
<br /><br />
Finally, at the end, he seems to admit that perhaps he was really at fault here:
<blockquote><i>
So what lessons has Christoforo taken from his brush with Internet infamy? "I'll definitely stay away from customer service emails," he said. "I could have nipped this all in the bud by being a little nicer. You never know who knows who, and lesson learned. We all have bad days and they caught me on one."
<br /><br />
"At the end of the day, I'm a human being, and it feels like the entire world was bullying me," he said. "I want people to like me, I don't want people to think I'm a bad person. ... I made a mistake. ... I hope I can make something positive out of it."
</i></blockquote>
We agree, and hope that he <i>can</i> make something positive out of it, but it's got to start with ditching the claim that he's somehow the victim in all of this and trying to excuse his behavior.<br /><br /><a href="http://www.techdirt.com/articles/20111229/02504317222/paul-christoforo-doesnt-seem-to-know-how-to-stop-digging-deeper-hole-internet-infamy.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20111229/02504317222/paul-christoforo-doesnt-seem-to-know-how-to-stop-digging-deeper-hole-internet-infamy.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20111229/02504317222/paul-christoforo-doesnt-seem-to-know-how-to-stop-digging-deeper-hole-internet-infamy.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>wow</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20111229/02504317222</wfw:commentRss>
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<pubDate>Tue, 27 Dec 2011 16:16:00 PST</pubDate>
<title>The Latest Entrant In 'How Not To Do Marketing' In An Online World: Ocean Marketing Fail</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20111227/12593617206/latest-entrant-how-not-to-do-marketing-online-world-ocean-marketing-fail.shtml</link>
<guid>http://www.techdirt.com/articles/20111227/12593617206/latest-entrant-how-not-to-do-marketing-online-world-ocean-marketing-fail.shtml</guid>
<description><![CDATA[ One of the key points that we've been making for years is that, in an online world, pissing off (or simply not caring about) customers is no longer a viable business strategy.  A good business today recognizes that the customers' best interests are also the company's best interests.  If you don't realize that... well, then you get into a situation like Paul Christoforo and Ocean Marketing that's taken the internet world by storm today.  It begins with a <a href="http://penny-arcade.com/resources/just-wow1.html" target="_blank">must read email thread posted at Penny Arcade</a>.  Seriously, just go read the whole thing.
<br /><br />
The short version for those who don't read it, is that a guy, Dave, who pre-ordered some gaming controllers that hadn't arrived, emailed Ocean Marketing and got back less than optimal customer service from Christoforo, who runs Ocean Marketing.  Actually, he got back obnoxious customer service.  Beyond not being helpful Christoforo is outright insulting of the customer (who has already paid for the item not yet delivered) and bragging about how "connected" he is.   In response, the customer (Dave) wrote back explaining why this was totally unacceptable, and cc'd some various gaming websites/blogs.  Gabe (aka Mike Krahulik) from PA chimed in, especially when he saw Christorofo brush off Dave by mentioning PA's own event PAX East.  After replying to both that Christoforo won't be allowed to exhibit at PAX, Christoforo (apparently not realizing who he was dealing with) simply makes a bad situation worse:
<blockquote><i>
We&rsquo;re not renting a booth at pax east this year , bigger and better shows to be at we got nothing from the show . Oh so you know this guy has sold over 500 thousand dollars of product in Dec and is my main distribution arm landing us in GameStop , fry&rsquo;s , Myers , Best buy , Activision , MLG , play N trade and a lot more . Were in 6 countries and you&rsquo;re not going to take my money for a booth that&rsquo;s a crock I can guarantee I&rsquo;ll get a booth if I want one money buys a lot and connections go even further.  He&rsquo;s a native Bostonian from Little Italy . Who are you again ? 
</i></blockquote>
Amazingly, this actually comes after Dave had told Mike "Please don&rsquo;t cancel their booth on my account.  As much as I hate this asshole, I still WANT his product and think it should be out there."  Mike explains to Christoforo that he runs PAX, but Christoforo still doesn't get it:
<blockquote><i>
OK Mike whatever you say lol , are you sure hour not in Boston I spoke to the person who ran the show in Boston last year. If you let some little kid influence you over a pre order then we don&rsquo;t want to be a your show ,Ill be on the floor anyway so come find me , I&rsquo;m born and raised in Boston I know the people who run the city inside and out watch the way you talk to people you never know who they know it&rsquo;s a small industry and everyone knows everyone. Your acting like a douchbag not that it matters pax east pax west , e3 , CES , Gamer Con , SSXW ,Comic Con, Germany I&rsquo;m all over the place. If we want to be there we will be there with industry badges or with a booth you think I can&rsquo;t team up with turtle beach , Callibur or Koy Christmas , I can&rsquo;t get Kevin Kelly to pull some strings or G4 , Paul Eibler Ex CEO of take 2 ,  Rich Larocco Konami , Cliff Blizinski Epic who were working with on a gears version , Activision who were working with on a MW3 and Spider man Bundle , The Convention Center Owners themselves , Mayor of Boston come on Bud you run a show that&rsquo;s all you do and lease a center in Cities you have no pull in its all about who you know not what you do.  I&rsquo;ll see space where ever I want , with who I want when I want and where I want so many ways around you and so many connections in this industry its silly. Anyway , I have no issue with you Sean Buckley Engadget, Scott Lowe IGN and the list goes on and on. Little kids unhappy with a PRE ORDER starting trouble and you email that to us , he&rsquo;s a customer unless you&rsquo;re his boyfriend then you should side with the company not the customer. Be Careful 
</i></blockquote>
And it gets worse from there.  Of course, once Gabe posted it to Penny Arcade, it started to get picked up elsewhere including (of course) <a href="http://www.reddit.com/r/gaming/comments/ns2pu/pa_makers_of_avenger_controllers_take_money_and/" target="_blank">Reddit</a>, and from there it just began exploding.  Popehat has <a href="http://www.popehat.com/2011/12/27/outsource-your-marketing-outsource-your-reputation-and-ethics-applies-to-every-industry/" target="_blank">a bunch of links</a> including the fact that Christoforo <a href="http://twitpic.com/7zb9gk/full" target="_blank">went ballistic</a> on Scott Lowe from IGN, after Lowe told Christoforo to stop saying IGN supported him.  Christoforo responded on Tiwtter calling him a "douchebag" and suggesting that because he sent IGN review units he should support him.  That tweet has since been removed, but the screenshot lives on.
<br /><br />
Separately, people have turned up <a href="http://www.natesnetwork.com/Poor-customer-service" target="_blank">more examples</a> of poor customer service experiences involving Ocean Marketing and Christoforo, as well as claims that Ocean Marketing has been <a href="http://www.examiner.com/video-game-industry-in-national/ocean-marketing-gaming-pr-rep-to-avoid-at-all-cost" target="_blank">plagiarizing a ton of articles from around the web</a> on its own blog.  Andrew Galbraith from Examiner.com has the details:
<blockquote><i>
It seems the plot has thickened a bit further. Apparently, <a href="https://twitter.com/#%21/williambgoss/status/151690994339942402" rel="nofollow">as</a> <a href="https://twitter.com/#%21/williambgoss/status/151676459826679810" rel="nofollow">pointed</a> <a href="https://twitter.com/#%21/williambgoss/status/151676681751511040" rel="nofollow">out</a> <a href="https://twitter.com/#%21/williambgoss/status/151676931337748481" rel="nofollow">by</a> <a href="https://twitter.com/williambgoss" rel="nofollow">@williambgoss</a> <a href="https://twitter.com/#%21/williambgoss/status/151677773105209344" rel="nofollow">on</a> <a href="https://twitter.com/#%21/popmortem/status/151683071568125952" rel="nofollow">twitter</a>, Ocean Marketing has been lifting articles from across the web for their blog with little to no attribution of sources whatsoever. An article <a href="http://www.forbes.com/sites/lisaarthur/2011/05/17/study-marketers-reporting-social-media-roi-of-100-200-even-1000-percent/" rel="nofollow">published on Forbes</a> is clearly posted wholesale on the <a href="http://oceanmarketinginc.com/blog/?p=461" rel="nofollow">Ocean Marketing blog</a> with no sourcing roughly two weeks after initially hitting the web. Moreover, the same is done with a <a href="http://www.bizreport.com/2011/04/social-marketing-goal-is-to-get-likes.html" rel="nofollow">BizReport article</a>, appearing as <a href="http://oceanmarketinginc.com/blog/?p=450" rel="nofollow">Ocean Marketing's "original work"</a> no less than two days later. &nbsp;
</i></blockquote>
The story has been getting picked up in a ton of places, but you have to wonder why anyone would hire Christoforo to market any of their products ever again.  The Popehat link above notes that when you outsource your marketing, you're outsourcing your reputation.  And that can be dangerous...
<br /><br />
In the meantime, it appears that Christoforo, beyond digging himself a deeper hole, has also tried to <a href="http://penny-arcade.com/2011/12/26/an-update1" target="_blank">well, dig himself a deeper hole</a>.  He first threatened to have his "lawyers" contact Penny Arcade, followed up by some begging:
<blockquote><i>
"You have the power Mike Please make it stop"
</i></blockquote>
Of course, as Gabe/Mike points out, he really doesn't have the power.  Once these things are out there, they're out there.  Then comes the non-apology apology, where Christoforo apologies for not knowing how big Penny Arcade/PAX are and for getting exposed -- but not for his actual actions:
<blockquote><i>
I just wanted to apologize for the way our emails progressed I didn&rsquo;t know how big your site was and I really didn&rsquo;t believe you ran Pax , So for what&rsquo;s its worth I am very sorry. Your post has obviously made my life very difficult and I have not slept yet dealing with all the spam and personal information intrusion as well as my family being smeared on the internet.
</i></blockquote>
That's not a real apology at all.  That's someone digging even deeper.
<br /><br />
<b>Update</b>: Ah, and now reports of <a href="http://kotaku.com/5871400/cut-paul-oceanmarketting-christoforo-a-breakhe-probably-just-has-roid-rage" target="_blank">pretending to be someone else</a>.  Kotaku apparently reached out to <strike>Bruce</strike> Brandon Leidel, who had been their contact in the past on the controller in question, and they noticed something odd in the response -- which suggested that it actually came from Christoforo.  Then Leidel apparently reached out to Kotaku separately saying that he no longer works with that client, in part because of Christoforo...<br /><br /><a href="http://www.techdirt.com/articles/20111227/12593617206/latest-entrant-how-not-to-do-marketing-online-world-ocean-marketing-fail.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20111227/12593617206/latest-entrant-how-not-to-do-marketing-online-world-ocean-marketing-fail.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20111227/12593617206/latest-entrant-how-not-to-do-marketing-online-world-ocean-marketing-fail.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>easy-to-boil-this-ocean</slash:department>
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<pubDate>Fri, 12 Aug 2011 06:14:44 PDT</pubDate>
<title>UMG Watermarks Audiophile Files, Pisses Off Paying Customers</title>
<dc:creator>Timothy Geigner</dc:creator>
<link>http://www.techdirt.com/articles/20110809/04114515451/umg-watermarks-audiophile-files-pisses-off-paying-customers.shtml</link>
<guid>http://www.techdirt.com/articles/20110809/04114515451/umg-watermarks-audiophile-files-pisses-off-paying-customers.shtml</guid>
<description><![CDATA[ Let's say, just for analogy's sake, you had a defense contractor that supplied weapons and ammunition to Earth's army. Let's say that army was going to war with the evil pod people from the planet Dah-Rull. And let's say that this defense contractor, named Universal Munitions Group, supplied the good guys with new bullet rounds that they promised would completely obliterate the Dah-Rull pod people and make everyone on Earth happy again.
<br /><br />
Now let's say that when Earth's army confronted their enemy and fired their weapons...the bullets, instead of firing, simply blew up, taking the limbs of Earth's infantry with them. As a result, the pod people were free to take over the world. You'd be pretty pissed, wouldn't you? Unless you're a pod-person, I mean?
<br /><br />
Yet that's about how effective Universal Music Group's latest attempt at watermarking is. You can read the <a href="http://www.hydrogenaudio.org/forums/index.php?showtopic=89818">fascinating exchange</a> on the message board of Hydrogenaudio.com, but here's the skinny. A customer of Passionato, a site dedicated to bringing audiophiles high quality recordings of classical music, notices that he was getting an odd thrumming noise on his FLAC file of Tchaikovsky's 5th Symphony that he got from Passionato (the file was advertised as lossless), a noise that wasn't present on the file he got directly from UMG. There's some back and forth between helpful board members about some technical issues that could have been the problem, but eventually, after multiple users go and test files similarly, they arrive at the conclusion that it must be watermarking. It culminates with someone from Passionato showing up and indicating that the file received was faithfully translated from whatever UMG supplied the site, meaning that any sound artifacts would have been the result of UMG's file, not a technical issue resulting from compression or file extension switches. Basically, UMG watermarked files being distributed through their partners. Files which are being advertised as lossless recordings for audiophiles.
<br /><br />
A couple of things were clear in that board exchange:
<br /><br />
First, nice try, UMG, but this isn't going to accomplish what you want it to. You're talking about a dedicated group of audiophiles here. There were all manner of suggestions for nixing the watermarking, from pirating an un-watermarked file (keeping in mind that it was already purchased in what was supposed to be lossless format), to doing a cut and paste remixing of the file from a clean one to cut out the artifact. Either way, it can be done away with.
<br /><br />
Second, <i>these are your damned customers</i>! Seriously, as ridiculous as my opening analogy was, this is equally stupid. Your watermarking is only pissing off paying customers. Now they have to, in addition to... you know... <i>giving you money</i>, go around and figure out a way to fix what you screwed up for them. And that's going to make them buy from you in the future? And that did <i>what</i> exactly to keep the files from being pirated elsewhere?
<br /><br />
I can't believe I have to say this to an established company, but: UMG, customers are people, too. Stop screwing with people and sell the product as advertised, or you'll find you'll have no more customers left to piss off.<br /><br /><a href="http://www.techdirt.com/articles/20110809/04114515451/umg-watermarks-audiophile-files-pisses-off-paying-customers.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20110809/04114515451/umg-watermarks-audiophile-files-pisses-off-paying-customers.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20110809/04114515451/umg-watermarks-audiophile-files-pisses-off-paying-customers.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>hisssssssssssssssss</slash:department>
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<pubDate>Thu, 28 Jul 2011 07:51:25 PDT</pubDate>
<title>Another Day, Another Study That Says 'Pirates' Are The Best Customers... This Time From HADOPI</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20110727/16233815292/another-day-another-study-that-says-pirates-are-best-customers-this-time-hadopi.shtml</link>
<guid>http://www.techdirt.com/articles/20110727/16233815292/another-day-another-study-that-says-pirates-are-best-customers-this-time-hadopi.shtml</guid>
<description><![CDATA[ We've pointed out that a <a href="http://www.techdirt.com/articles/20110721/04092915191/industry-suppressed-report-showing-users-shuttered-pirate-site-probably-helped-movie-industry.shtml">whole series of studies</a> have all suggested that the biggest infringers of content online also tend to be the best customers of content, rather than just "freeloaders" who refuse to pay for content.  Critics of these studies brush them off (without any evidence) by simply saying if that were true, then sales of content wouldn't have dropped so much in the music industry (other industries, it should be noted, have not seen such a drop-off).  But that's misunderstanding (or misapplying) basic statistics.  No one is saying that this means that file sharing automatically leads to more sales.  But it does suggest that treating those people as just "freeloaders who just want stuff for free" is absolutely the wrong response.  It shows that these people are <i>willing</i> to pay money if they're given a good <i>reason to buy</i>.  The problem is that they're <i>not</i>.
<br><br>
From a strategic standpoint, this impacts how one responds to increased "piracy."  If you realize that they're merely underserved customers, the correct response is to come up with better business models.  If the problem is that it's "free, free, free!" then perhaps enforcement could make some sense.  But... all of the studies seem to suggest it's the former, rather than the latter... and thus the enforcement/stricter copyright responses won't help at all (as we've seen).
<br><br>
Joe Karaganis, from SSRC, points us to the news that there's been <a href="http://piracy.ssrc.org/hadopi-says-lets-try-cutting-off-nose-to-spite-face/" target="_blank">yet another such study... and this one is from HADOPI, itself</a>.  Yes, the French agency put together to kick people off the internet for file sharing did a study on the nature of unauthorized file sharing, too.  Not surprisingly (and consistent with every other study we've seen on this topic), it found that those who spend a lot of money on content... were much, much, much more likely to also get content through unauthorized means.  HADOPI released the results in a somewhat convoluted way (perhaps trying to downplay this result), but Karaganis reformatted the results to make this clear:
<center>
<img src="http://i.imgur.com/RvXCO.png" width=560 />
</center>
Karaganis suggests, then, that HADOPI's method of dealing with this -- threatening people to stop their file sharing, won't do very much to help the bottom lines of the entertainment industry:
<blockquote><i>
If piracy is a sampling and discovery tool for high spenders, then suppressing piracy could depress legal sales.   If&ndash;as I&rsquo;ll argue at more length in a subsequent post&ndash;we&rsquo;re in a mostly zero-sum market in which consumers are maxed out on discretionary media expenditures, then enforcement won&rsquo;t significantly expand but at best just cannibalize one media sector for another.  Music, games, and movies, let&rsquo;s say, competing for the same discretionary dollars&ndash;and all of them competing with rising, increasingly non-discretionary internet access and data charges.   If we&rsquo;re in this type of market, then HADOPI is just in the business of eliminating its best customers.  Good luck with that business model.
</i></blockquote>
And suppressing the means of communication at the same time -- collateral damage for no good purpose.  Brilliant!<br /><br /><a href="http://www.techdirt.com/articles/20110727/16233815292/another-day-another-study-that-says-pirates-are-best-customers-this-time-hadopi.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20110727/16233815292/another-day-another-study-that-says-pirates-are-best-customers-this-time-hadopi.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20110727/16233815292/another-day-another-study-that-says-pirates-are-best-customers-this-time-hadopi.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>damn-that-data</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20110727/16233815292</wfw:commentRss>
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<pubDate>Tue, 26 Jul 2011 12:38:27 PDT</pubDate>
<title>Former Google CIO &#038; EMI Digital COO Guy Explains How File Sharing Is Good For Artists</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20110726/02584815254/former-google-cio-emi-digital-coo-guy-explains-how-file-sharing-is-good-artists.shtml</link>
<guid>http://www.techdirt.com/articles/20110726/02584815254/former-google-cio-emi-digital-coo-guy-explains-how-file-sharing-is-good-artists.shtml</guid>
<description><![CDATA[ In April of 2008, EMI hired Doug Merrill away from his Google CIO position to lead the company's digital efforts.  As we noted at the time, this actually seemed like an opportunity for EMI to really <a href="http://www.techdirt.com/articles/20080401/235437721.shtml">embrace</a> what the technology allowed, though we feared whether he'd have any real power at EMI.  Indeed, it wasn't too surprising to see him <a href="http://www.techdirt.com/articles/20090323/1615084216.shtml">leave</a> less than a year later, without a clear explanation at all.  We'd heard some rumors of a bit of a "culture clash," and it appears that Merrill is finally confirming that in a recent speech he gave.  What was the culture clash?  Well, Merrill, like a typical Googler, decided to actually look at the <i>data</i> and found that <a href="http://torrentfreak.com/former-google-cio-limewire-pirates-were-itunes-best-customers-110726/" target="_blank">it said file sharing could be good for artists</a> and that users of Limewire were their <a href="http://www.computerworld.com.au/article/394785/former_google_cio_says_business_misses_key_people_marks/" target="_blank">best customers</a>:
<blockquote><i>
Merrill profiled the file sharing behaviour of people who used Limewire against the top iTunes sales and the biggest iTunes buyers were the same as the highest sharing &ldquo;thieves&rdquo; on Limewire.
<br /><br />
&ldquo;That's not theft, that's try-before-you-buy marketing and we weren&rsquo;t even paying for it&hellip; so it makes sense to sue them,&rdquo; he said wryly.
</i></blockquote>
Not surprisingly, as we've noted over and over again, this sort of data and evidence (of which there are now at least half a dozen studies all saying the same thing) is simply not something that the major record labels are willing to hear.  They just continue to deny the evidence.  And then they wonder why they're flailing...  Merrill apparently didn't talk about his departure from EMI, but it's not difficult to read between the lines.<br /><br /><a href="http://www.techdirt.com/articles/20110726/02584815254/former-google-cio-emi-digital-coo-guy-explains-how-file-sharing-is-good-artists.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20110726/02584815254/former-google-cio-emi-digital-coo-guy-explains-how-file-sharing-is-good-artists.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20110726/02584815254/former-google-cio-emi-digital-coo-guy-explains-how-file-sharing-is-good-artists.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>oops</slash:department>
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<pubDate>Wed, 12 Jan 2011 12:21:00 PST</pubDate>
<title>If Your Business Model Is Based On Hoping Your Customers Never Do Math, You're In Trouble</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/blog/entrepreneurs/articles/20101111/18052111823/if-your-business-model-is-based-hoping-your-customers-never-do-math-youre-trouble.shtml</link>
<guid>http://www.techdirt.com/blog/entrepreneurs/articles/20101111/18052111823/if-your-business-model-is-based-hoping-your-customers-never-do-math-youre-trouble.shtml</guid>
<description><![CDATA[ As we get closer to the NY Times finally putting in place its long-promised, often-mocked paywall concept, it's worth pointing to a story from a couple months ago, which I  didn't have time to write about when it came out.  It involved some comments on a panel from Gerald Marzorati, the Times' assistant managing editor for new media and strategic initiatives, in which he more or less <a href="http://blogs.forbes.com/jeffbercovici/2010/11/10/ny-times-editor-on-the-beauty-of-readers-ignorance/" target="_blank">mocked the subscribers of the print publication</a> for being too ignorant to do basic math and realize just how much they were paying:
<blockquote><i>
"We have north of 800,000 subscribers paying north of $700 a year for home delivery," Marzorati said. "Of course, they don't seem to know that."
<br /><br />
As evidence that Times subscribers don't realize how much a subscription costs, he pointed to what happened when the paper raised its home-delivery price by 5 percent during the recession: Only 0.01 percent of subscribers canceled. "I think a lot of it has to do with the fact that they're literally not understanding what they're paying," he said. "That's the beauty of the credit card."
</i></blockquote>
Of course, another explanation (which is much more favorable to the NY Times) is just one of general price inelasticity to a newspaper like the NY Times.  If that's the case, where the price rises and most people keep subscribing, it suggests that most of those people continue to value the subscription more than the price, and the newspaper might even be able to get away with raising the price further.  What's odd, however, is this assumption by Marzorati, that it's the general ignorance of their subscribers that keeps them in business.  We're in an age when assuming ignorance on your customer base is a very dangerous position to be in.
<br /><br />
If the company's guy in charge of new media and strategic initiatives seems gleeful over ignorant readers, rather than focusing on ways to make sure they continue to get more value out of their subscription than they pay for it, it makes you wonder how long this sort of setup can really last.  There are all sorts of ways that a publication with the reputation of the NY Times can make lots and lots of money.  But betting on the ignorance of subscribers does not seem to be like the best overall strategy.<br /><br /><a href="http://www.techdirt.com/blog/entrepreneurs/articles/20101111/18052111823/if-your-business-model-is-based-hoping-your-customers-never-do-math-youre-trouble.shtml">Permalink</a> | <a href="http://www.techdirt.com/blog/entrepreneurs/articles/20101111/18052111823/if-your-business-model-is-based-hoping-your-customers-never-do-math-youre-trouble.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/blog/entrepreneurs/articles/20101111/18052111823/if-your-business-model-is-based-hoping-your-customers-never-do-math-youre-trouble.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>ny-times,-we're-looking-at-you</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20101111/18052111823</wfw:commentRss>
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<pubDate>Fri, 10 Dec 2010 14:30:00 PST</pubDate>
<title>Warner Bros. Finally Realizes That 'Pirates' Are Underserved Customers</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20101210/13123412237/warner-bros-finally-realizes-that-pirates-are-underserved-customers.shtml</link>
<guid>http://www.techdirt.com/articles/20101210/13123412237/warner-bros-finally-realizes-that-pirates-are-underserved-customers.shtml</guid>
<description><![CDATA[ We've discussed in the past just how <a href="http://www.techdirt.com/articles/20101116/16591611901/how-warner-bros-should-have-responded-to-harry-potter-leak.shtml">backwards</a> Warner Bros. has been at times in responding to "piracy." So it's a bit amusing that many, many, many years after plenty of us have been pointing this out (and have been told directly by folks at Warner Bros. that we're "full of it") that the company is finally recognizing that <a href="http://paidcontent.org/article/419-warner-bros.-targets-new-consumer-segment-pirates/" target="_blank">those who infringe are really just underserved customers</a>, whom they didn't give a good reason to buy:
<blockquote><i>
<b>Pirates Make Purchases:</b> Few subsist on copyright infringement alone; typical pirates steal in addition to making legitimate entertainment purchases like boxoffice, DVD and even online transactions. Even the most diehard pirates spend some money, though less than more casual infringers. "One of the main things we're doing is looking at why they do things legitimately on certain products and not on others," said [WB's director of business intelligence, Ben] Karakunnel.
</i></blockquote>
Apparently, they just started looking at this data only 18 months ago.  Frankly, the fact that they weren't looking at that data seven or eight years ago suggests a dysfunctional management team.  What's really silly, of course, is that plenty of folks have made this exact point to people at Warner Bros. and elsewhere for years, and were told that we were just "defending pirates."
<br /><br />
Another thing they realized was that in foreign markets, a lot of unauthorized copies are because WB didn't make translated/subtitled versions available quickly enough -- another point that sites like ours have been making for years and which WB just figured out:
<blockquote><i>
In the international markets, illegal WB content in which pirates dub or subtitle themselves is increasingly popular. For one unspecified program Karakunnel used as an example, it wasn't until the third day after its initial airdate that one such pirate-created translated version accounted for 23% of pirated files of that particular program. By day 10, it accounted for 74%.
<br /><br />
Said Karakunnel, "If we can get dubbed or subtitled language versions in the first two days, we can beat them to the punch."
</i></blockquote>
Kudos to Warner Bros. for finally figuring this out, but it's pretty amusing that the company thinks this is new, when just a couple years ago it was denying that any of this was possible.<br /><br /><a href="http://www.techdirt.com/articles/20101210/13123412237/warner-bros-finally-realizes-that-pirates-are-underserved-customers.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20101210/13123412237/warner-bros-finally-realizes-that-pirates-are-underserved-customers.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20101210/13123412237/warner-bros-finally-realizes-that-pirates-are-underserved-customers.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>took-you-this-long?</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20101210/13123412237</wfw:commentRss>
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<item>
<pubDate>Tue, 21 Sep 2010 18:24:00 PDT</pubDate>
<title>Expectations Matter, Even If You're Not 'A Customer'</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100921/03371711089/expectations-matter-even-if-you-re-not-a-customer.shtml</link>
<guid>http://www.techdirt.com/articles/20100921/03371711089/expectations-matter-even-if-you-re-not-a-customer.shtml</guid>
<description><![CDATA[ We recently had a <a href="http://www.techdirt.com/articles/20100920/11350411082/scribd-puts-user-docs-behind-a-paywall-without-them-realizing-it.shtml" target="_blank">discussion</a> about law professor Eric Goldman's <a href="http://blog.ericgoldman.org/personal/archives/2010/09/scribd_puts_my.html" target="_blank">complaints</a> about Scribd, after the site, which he'd been using regularly to upload and share legal documents, quietly put up a paywall on older documents without making that clear to users.  Suddenly, many old documents that Goldman had thought he was sharing with the world, were hidden behind a lock and key, unless you paid up.
<br /><br />
While many people agreed that this was a mistake on the part of Scribd, in talking with Goldman separately about this, he noted that a few people strongly disagreed with his position, and noted (accurately) that he was getting a free service from Scribd, and thus he was "not a customer" and shouldn't complain at all.  We received a few <a href="http://www.techdirt.com/articles/20100920/11350411082/scribd-puts-user-docs-behind-a-paywall-without-them-realizing-it.shtml#c63" target="_blank">similar comments here</a>, effectively suggesting that if you're not paying, you're not a customer and, thus, have no right to complain.
<br /><br />
This is silly -- and wrong.  It's where the often artificial distinction between "customer" and "user" and "product" gets blurry and, at times, questionable, especially in the realm of "user-generated" content.  There are more ways to "pay" than with money.  In Goldman's case, he's actually been "paying" Scribd by providing it with valuable, sought-after content that he uploads.  Scribd is "paying" Goldman with free hosting, bandwidth and services.  Advertisers are "paying" Scribd with money.  Users are "paying" Scribd with their attention.  All are "customers" in some sense, while also being users and, potentially, "the product," as well.  Focusing only on the relationships where actual cash exchanges hands misses the point (greatly).
<br /><br />
Once you realize that, it makes perfect sense for Goldman to complain.  He was using the service under pretty explicit terms that he was providing these documents to share them with the world.  Scribd unilaterally (and quietly) changed those terms on him, to something completely different.  In turn, by pissing off Goldman, and having him seek alternatives, Scribd is actually harming its overall site.  Even if you accept the narrow definition of "customer," to suggest that Scribd's only customers are their advertisers, pissing off Goldman should still be seen as a problem, because as Goldman uses alternative services, it lessens the "product" that Scribd can offer to those particular "customers."
<br /><br />
So rather than going with the kneejerk, "well, if he's not paying for it, he has nothing to complain about," it's important to look at the overall ecosystem, and how different pieces are "paid" in different ways -- and how upsetting one key element of that ecosystem, can harm all sorts of "customers."<br /><br /><a href="http://www.techdirt.com/articles/20100921/03371711089/expectations-matter-even-if-you-re-not-a-customer.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100921/03371711089/expectations-matter-even-if-you-re-not-a-customer.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100921/03371711089/expectations-matter-even-if-you-re-not-a-customer.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>false-distinctions</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100921/03371711089</wfw:commentRss>
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<item>
<pubDate>Mon, 8 Mar 2010 06:12:00 PST</pubDate>
<title>Ubisoft's 'You Must Be Connected To This Server' Annoying DRM Servers Go Down</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100308/0138388459.shtml</link>
<guid>http://www.techdirt.com/articles/20100308/0138388459.shtml</guid>
<description><![CDATA[ Sometimes you have to wonder if folks like Ubisoft, who keep insisting that it needs to use DRM, are just messing with everyone.  As you certainly know, Ubisoft decided to go with some <a href="http://www.techdirt.com/articles/20100127/2100117954.shtml">incredibly annoying DRM</a> for some new games, requiring you to be online <a href="http://www.techdirt.com/articles/20100218/1514238229.shtml">at all times</a>, even for single-player games.  So, what happens?  The servers that you must be connected to <a href="http://www.joystiq.com/2010/03/07/ubisoft-drm-authentification-server-is-down-assassins-creed-2/" target="_blank">crashed, making those games completely unplayable</a> for many, while creating lengthy login delays for others.  That basically makes the game useless for many.  Well, unless you downloaded the <a href="http://www.techdirt.com/articles/20100304/1302148421.shtml">cracked version</a>.  Once again, DRM is shown to harm buyers, but do nothing to stop unauthorized use.<br /><br /><a href="http://www.techdirt.com/articles/20100308/0138388459.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100308/0138388459.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100308/0138388459.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>but-of-course</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100308/0138388459</wfw:commentRss>
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<pubDate>Fri, 6 Nov 2009 04:10:33 PST</pubDate>
<title>Comcast Exec: We Need To Change Customer Behavior, Not Our Business Model</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20091030/1624136747.shtml</link>
<guid>http://www.techdirt.com/articles/20091030/1624136747.shtml</guid>
<description><![CDATA[ <a href="http://www.techdirt.com/profile.php?u=brooks">Brooks</a> writes <i>"Speaking at a cable broadcaster's summit, <a href="http://www.broadcastingcable.com/article/366272-CTAM_Summit_2009_Comcast_s_Burke_Tells_TV_Biz_To_Help_Stop_Cord_Cutting.php" target="_blank">Steve Burke, Comcast's COO, said</a>: "An entire generation is growing up, if we don't figure out how to change that behavior so it respects copyright and subscription revenue on the part of distributors, we're going to wake up and see cord cutting."  How's that for cart before the horse?<br />
<br />
His ultimate goal -- to maintain or increase revenue for Comcast -- makes perfect sense, and is positively what a cable COO should be focused on.  From there on out, though, he's off in the weeds.  How about offering this new generation new and innovative services that are worth paying for?  That's challenging, of course... but how challenging will it be to change the next generation's behavior "to respect subscription revenue."  Yikes.<br />
<br />
How many consumers, in any market, are focused on "respecting" vendors' revenue streams?  How, exactly, does he propose to effect this sea change?  And why not just develop products that consumers will willingly pay for, rather than trying to change consumer behavior in such a fundamental way?"</i>
<br /><br />
The quotes really are quite stunning.  Burke basically seems to be saying the focus needs to be on figuring out ways to get consumers to change, rather than changing to match what customers want.  A business model based on going against what consumers want doesn't seem likely to last that long.<br /><br /><a href="http://www.techdirt.com/articles/20091030/1624136747.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20091030/1624136747.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20091030/1624136747.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>good-luck,-buddy</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20091030/1624136747</wfw:commentRss>
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<pubDate>Tue, 18 Aug 2009 10:58:00 PDT</pubDate>
<title>Myth Debunking: Fans Just Want Everything For Free</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090817/1703385904.shtml</link>
<guid>http://www.techdirt.com/articles/20090817/1703385904.shtml</guid>
<description><![CDATA[ The debate between Ben Sheffner and William Patry continues over at Patry's blog, and Sheffner has an interesting piece where he argues (delicately) that <a href="http://moralpanicsandthecopyrightwars.blogspot.com/2009/08/bens-reply.html" target="_new">sometimes the customer <i>isn't</i> right</a>.  He admits upfront that this is a tricky position to defend, and he starts out with a more nuanced view as to why that is, but then he gets to this:
<blockquote><i>
So everyone wants the product -- but too many don't want to pay for it. Hell, I don't want to pay for it. I would love it if I could get all the movies and music I want for free. And I would love it if I could get all the BMWs, houses in the hills, and meals at Urasawa I want for free as well. But of course I realize I can't. Just about everyone is with me on the BMWs and houses part. But too many think that movies and music should be free, and don't see anything wrong with taking them. I'm willing to say they're wrong.
<br /><br />
Everyone understands why they can't have all the physical goods they want for free. But they have a much harder time understanding that with intangible goods like movies and music. IP is just harder to understand, and to explain, than physical property. We need theories to undergird it, special laws to define it, and special classes at law school to learn how to fight over it -- not to mention eight-volume treatises to tell us what the law actually is. So when people commit copyright infringement, they may think they're causing no harm -- but they are. They're undermining a system that enables those big, bad companies that everyone loves to hate, to finance the movies and albums that we all love.
</i></blockquote>
This is a myth.  It's a popular myth, and I'm quite sure that Sheffner and lots of folks on both sides of the debate think its entirely accurate.  But it's a myth.  The nature of a good economic transaction is one in which both parties are better off after the exchange.  That means the people "paying" don't mind paying.  They're happy to pay because they believe that what they have received is better than the cost it took to acquire it.  But basic economics plays into the situation here: if the same thing <i>can be</i> made available by others in a <i>better way</i>, it's only natural for people to ask why they should have to pay.
<br /><br />
But if you want real proof that there's a <i>lot</i> more at work than the idea that consumers just want everything for free and think that if it's not free they should just take it, look no further than the countless examples we've shown of people <a href="http://www.techdirt.com/articles/20090105/1657523291.shtml">paying lots of money</a> to support those providers who <i>don't</i> treat their fans as criminals, who <i>don't</i> try to prevent what the technology allows and who actually work to connect with those fans and give them a true <i>reason to buy</i>.
<br /><br />
Everyone wants a good deal, and a fair deal, but people are more than willing to pay <i>if it makes economic sense</i>.  Whether consciously or not, there are an awful lot of people who inherently recognize that the economics don't make sense when a good is infinitely available.  As much as people have trouble understanding explicit economic concepts like supply and demand, instinctively many do, in fact, understand the very nature of abundance and what it means for pricing.  It's not some nefarious story of a bunch of immoral "thieves" wanting stuff for free.  It's an inherent understanding of competitive markets.
<br /><br />
On top of that, Sheffner takes the position that paying for these things is necessary, because not paying for them "undermines the system," he is once again being misleading.  It may undermine one particular way that the system works, but the false statement is implicit in his argument: that this is the <i>only</i> way of funding such creation.  That is demonstrably false, as we've shown time and time again.  I have no doubt that Sheffner is sincere in his argument, but it's based on a false premise that because the system <i>used</i> to work one way, back before technology changed the basic economics it relied on, that somehow we should all suffer by limiting what the technology allows and by ignoring basic economics.
<br /><br />
It would be nice if it were possible, but I cannot find a single example of a modern society being able to successfully hold back or ignore what technology allows when it comes to economics.
<br /><br />
Finally, way back when I was in high school, I worked at a bagel shop, which also sold other baked goods.  The boss's position was that "the customer is always right" except for one particular issue: the customer could only get the next piece of coffee cake in order.  We had this giant sheet cake coffee cake, and many customers didn't want "end pieces," and would ask for middle pieces instead.  On more than one occasion, this resulted in angry customers stomping out -- and even once resulted in a fist fight between a customer and the owner's son.  Over time, as more competition entered the neighborhood (a Dunkin' Donuts across the street, another bagel shop a block away), we lost a lot of business for our baked goods.
<br /><br />
The point, which should be clear, is that you can <i>say</i> the customer is wrong all you want.  But, in the end, the market will decide that the customer is right.  Always.  If you don't provide what the customer wants (a fair transaction) and others are able to do so, you will suffer.
<br /><br />
The movie industry and the music industry both have had numerous opportunities to embrace what the technology allows -- and to craft new business models that would be massive money makers in doing so.  They have chosen not to do so.  They have said that the customer is wrong, and, as Sheffner notes, they have no problem saying so.  The problem is that, whether legal or not, the competition is springing up left and right.  Sheffner and his former colleagues can stand on whatever principles they want.  The market doesn't care.  The market only cares for those who serve the customers' needs.  Plenty of others are doing so (both legally and illegally).  Those who want to survive in business would be smart to take lessons from those who are succeeding and looking to implement smart business models around them.  Those who want to insist that "the customer can be wrong" may feel good when they look in the mirror, but they're going to have to contend with a rapidly diminishing customer base.
<br /><br />
The customer can be wrong, but focusing on that doesn't get them to pay you.<br /><br /><a href="http://www.techdirt.com/articles/20090817/1703385904.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090817/1703385904.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090817/1703385904.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>except-when-they-don't</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090817/1703385904</wfw:commentRss>
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<item>
<pubDate>Thu, 13 Aug 2009 19:32:17 PDT</pubDate>
<title>SitePoint: Rather Than Freaking Out Over Piracy, We Decided To Adapt</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090813/1754355870.shtml</link>
<guid>http://www.techdirt.com/articles/20090813/1754355870.shtml</guid>
<description><![CDATA[ AnonJr alerts us to the news that publisher/media firm SitePoint, has decided to <a href="http://www.sitepoint.com/blogs/2009/08/11/no-more-passwords-on-sitepoint-pdfs/" target="_new">do away with the passwords on the PDF versions of its books</a>, noting that it seemed to only serve to piss off customers:
<blockquote><i>
In the 18 months I have worked at SitePoint, barely a week has gone by where I have not received at least a couple of emails from customers questioning the logic behind our password protection policy. My response, based on the SitePoint philosophy, was always that we were taking an ethical (if largely symbolic) stance on the piracy issue. But how long could we maintain that line while simultaneously placing primacy on the customer experience, as all the while more and more requests to remove password protection poured in.
<br /><br />
As a web development resource and learning centre, we know that we must embrace the state of flux -- not as a lofty ideal, but as a normative imperative. You can't claim to be all about the cutting edge when you're stubbornly clinging to old, outmoded processes -- especially when your own beloved customers are urging you to move on. And if we're not keeping pace with the constantly evolving face of web design and development, then we're neither a resource nor a learning centre -- we're a museum.
</i></blockquote>
Kudos to another company recognizing that pissing off your best customers is hardly a way to run a business.<br /><br /><a href="http://www.techdirt.com/articles/20090813/1754355870.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090813/1754355870.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090813/1754355870.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>good-for-them</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090813/1754355870</wfw:commentRss>
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<pubDate>Thu, 13 Aug 2009 04:49:00 PDT</pubDate>
<title>Premier League's Fear Of The Internet A Case Study In What Not To Do</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090811/1913425851.shtml</link>
<guid>http://www.techdirt.com/articles/20090811/1913425851.shtml</guid>
<description><![CDATA[ While we have many problems with the way MLB.com conducts itself concerning its attempts to claim ownership of factual information, you can't deny that (separate from that), it's built up a nice business by really focusing on giving fans what they want in terms of online video.  While the product has had technical problems, on the whole MLB.com continues to improve it, adding many unique and useful features, such that it's actually well worth purchasing.  If you order the package to watch baseball games, it gives you all sorts of neat tools that can't be found elsewhere, and are great for tracking pretty much any game you want.  There are still some problems -- including silly blackout zones (so it's tough to watch local teams) and blackout times when games are being shown on national TV, but on the whole MLB.com has done a pretty good job making the service worth buying.
<br /><br />
Compare that to the Premier League in the UK.  It's been nearly five years since the league first started <a href="http://www.techdirt.com/articles/20050518/1140238.shtml">freaking out</a> about people watching unauthorized streams online.  But rather than trying to serve those <a href="http://www.techdirt.com/articles/20090122/1613063493.shtml">underserved customers</a>, the Premier League has repeatedly lashed out at anyone who might possibly enable these games to be seen online.  For example, it's <a href="http://www.techdirt.com/articles/20070504/155624.shtml">sued YouTube</a> apparently unaware that the company is protected by the safe harbors of the DMCA, and (if anyone) it should be going after those who actually upload the games.  It's also <a href="http://www.techdirt.com/articles/20081103/1047072724.shtml">suing Justin.tv</a> in the same misguided fashion.
<br /><br />
Amazingly, the league seems <i>proud</i> of the fact that it's going after these companies, rather than the appropriate targets.  <a href="http://www.techdirt.com/profile.php?u=jshtaylo">Jeff T</a> alerts us to an article in the Guardian which is basically a <a href="http://www.guardian.co.uk/football/2009/aug/11/premier-league-tv-rights-deals-websites" target="_new">case study in what not to do about these things</a>.  It hypes up how the Premier League purposely goes after the platform providers, as if that's a good thing.  It also (bizarrely) claims that these anti-fan maneuvers are somehow a different and better response than the way the music industry responded to unauthorized file sharing.  But that's not true.  While it's not suing fans directly, it's still suing to stop fans from doing what they want to do. It's the same exact mistake.
<br /><br />
Rather than recognizing the simple fact that the <i>reason</i> fans watch these streams online is because <i>the Premier League has <b>failed</b> to offer it up themselves</i>, the Premier League seems to relish the fact that it makes it more difficult for fans to see its product.   The article talks about the "Saturday blackouts" on video designed to get more fans to go to matches, without recognizing that such blackouts have been shown to be pointless.  There used to be rules for baseball in the US that games that weren't sold out wouldn't be shown on TV, but eventually people realized that people weren't watching on TV as a <i>substitute</i> for going to the game, but because they love their favorite team and want to watch them however possible.  The more they can watch them on TV, the <i>more</i> interested they are in seeing live games.
<br /><br />
Jeff, who sent this story in, makes the point quite clearly, by noting that he watches poor quality streams of Premier League matches in Canada <i>because</i> the League refuses to make most of their matches available to watch online.  Rather than going after the companies that run platforms that enable such things, there's a really simple solution: offer high quality online webcasts yourself, and actually serve the fans.  But that seems far beyond the Premier League's strategic thinking.<br /><br /><a href="http://www.techdirt.com/articles/20090811/1913425851.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090811/1913425851.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090811/1913425851.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>this-is-not-a-good-idea</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090811/1913425851</wfw:commentRss>
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<pubDate>Thu, 16 Jul 2009 15:19:00 PDT</pubDate>
<title>EMI's CEO Admits Company 'Lost Touch' But Doesn't Seem To Know How To Fix It</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090715/1348145553.shtml</link>
<guid>http://www.techdirt.com/articles/20090715/1348145553.shtml</guid>
<description><![CDATA[ Well, this is rather incredible.  EMI was one of the major labels that, for a brief period of time, seemed like it might actually have figured stuff out.  You see, it got taken over by some folks from <i>outside</i> the recording industry, and they talked about how they needed to <a href="http://www.techdirt.com/articles/20071009/191057.shtml">pay attention</a> to experiments like Radiohead's and learn how to better respond to customer desires like that.  That was two years ago.  The company was also the first of the major labels to <a href="http://www.techdirt.com/articles/20070402/081920.shtml">dump DRM</a>.  It then <a href="http://www.techdirt.com/articles/20080310/110443492.shtml">pulled back</a> on its support for the RIAA and IFPI (after threatening to withdraw completely), saying that the strategy of suing fans was a dead end.  On top of all that, it <a href="http://www.techdirt.com/articles/20080609/1240501350.shtml">hired</a> some Silicon Valley techies.  For a while, we actually thought EMI might be the most interesting of the major record labels to follow.
<br /><br />
But... old habits die really hard, apparently.  The company has been <a href="http://www.techdirt.com/articles/20080630/0114251541.shtml">suing</a> pretty much every innovative startup that comes along, often <a href="http://www.techdirt.com/articles/20080617/0757251433.shtml">targeting execs personally</a> in attempts to bankrupt them.  Sometimes it's been going after <a href="http://www.techdirt.com/articles/20090224/2340153891.shtml">hobbyists</a> or investors beyond just the actual companies.  Often times, the company seems to be negotiating with innovators on the one hand, while filing unexpected <a href="http://www.techdirt.com/articles/20090618/0011185272.shtml">lawsuits</a> at the same time.  One of the key techies it hired, Doug Merrill from Google, <a href="http://www.techdirt.com/articles/20090323/1615084216.shtml">left</a> after less than a year.  More recently, the company <a href="http://www.techdirt.com/articles/20090707/0314175470.shtml">refused</a> to agree to more reasonable (but still high) streaming rates to get music back on YouTube in the UK.
<br /><br />
Basically, it appears that EMI <i>said</i> it wanted to do something new, but couldn't resist doing everything it could to snuff out innovation.  It takes more than words to actually convince both consumers and musicians that you're really adapting.  Is it any wonder that people aren't fans?  EMI's CEO <a href="http://www.hypebot.com/hypebot/2009/07/emi-ceo-leonisceti-weve-clearly-lost-touch.html" target="_new">is now admitting that the company "lost touch" with consumers</a>:
<blockquote><i>
"Music is in demand and the demand is growing all the time, but we've clearly lost touch with our consumers.  I passionately believe that if we listen to our consumers, this gap will become our opportunity."
</i></blockquote>
Ok, so start listening!  <i>STOP SUING INNOVATORS</i>.  Stop suing executives and investors in those innovators.  Stop using lawsuits as a negotiation tactic.  Start focusing on giving <i>fans</i> what they want.  Start focusing on <i>enabling</i> new business models that work <i>for artists</i>.  Stop thinking about getting a transaction on every piece of music played, but start looking at ways to use the music to create additional products people <i>want</i> to buy.  Stop trying to limit users and limit musicians.  Enable them both.  Also, over a year ago, Topspin's Ian Rogers wrote a brilliant <a href="http://www.techdirt.com/articles/20080527/0028181222.shtml">open letter</a> to EMI execs suggesting a rather smart way it could leverage its existing artist relationships.  It doesn't seem like EMI listened at all.
<br /><br />
If EMI wants <i>help</i> in listening, why not contact some of us who have been presenting solutions and showing <a href="http://www.techdirt.com/articles/20090621/1626125300.shtml"><i>what works</i></a>?  We're not that hard to <a href="http://www.techdirt.com/contact.php">reach</a>, and I'm sure plenty of folks in our community would be more than willing to provide some incredibly useful suggestions.<br /><br /><a href="http://www.techdirt.com/articles/20090715/1348145553.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090715/1348145553.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090715/1348145553.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>perhaps-by-not-suing-everyone</slash:department>
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<pubDate>Thu, 2 Jul 2009 10:16:24 PDT</pubDate>
<title>Even More eMusic Features Disabled?</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090702/0346555437.shtml</link>
<guid>http://www.techdirt.com/articles/20090702/0346555437.shtml</guid>
<description><![CDATA[ This is really unfortunate.  eMusic used to be a <i>great</i> example of how treating customers right and with respect and trust could win over more customers -- but in the last month or so, it seems like the company is throwing all that out the window and pissing off customers left and right.  Beyond the <a href="http://www.techdirt.com/articles/20090602/2250355103.shtml">big price increase</a> at the same time as signing its first major record label (bad PR to announce both together), the company has <a href="http://www.techdirt.com/articles/20090603/2329075118.shtml">censored critics</a> and <a href="http://www.techdirt.com/articles/20090624/0216435344.shtml">removed</a> the feature that let you redownload songs you'd purchased before, at your convenience.  However, now we're hearing that there were a bunch of other features that were removed as well.  An anonymous reader notes:
<blockquote><i>
"July 1 was the first day in the Sony era over at eMusic. Despite published interviews with eMusic executives, FAQs on the eMusic web site and messages from eMusic employees on the eMusic forums attempting to clarify the new pricing structure, there were quite a few surprises. Some of the changes I've noticed (or read about in the forums) include:
<ul>
<li>Certain tracks can only be downloaded with "paid" credits, not the free credits eMusic hands out for trial memberships.
</li><li> Individual track downloads disabled for tracks longer than 10 minutes - you must download the entire album
</li><li> Certain (popular) sub-10-minute tracks disabled for individual download
</li><li> No downloading individual discs in multi-disc sets
</li><li> Most new albums use 12-credit album pricing (very few reports of 6 or 9 credit album pricing)
</li><li> Many (a significant portion in the classical section at least) albums with fewer than 12 tracks cost 12 credits
</li><li> Many albums previously available on eMusic have been re-priced (in some cases, tracks available for 1 credit on June 30 now require 12 credits)
</li></ul>
IMO, the fact that eMusic did such a poor job communicating these
important changes suggests that they deliberately withheld (or downplayed) this information, possibly to keep from fueling the outrage generated from last month's Sony/pricing announcement."
</i></blockquote>
This seems like an increasing disaster.  Hopefully some of these changes are mistakes, rather than permanent.  But the way this whole situation has been handled is going to make a terrific case study in how not to do PR.  eMusic has turned from a company that customers really loved into one that many seem to hate... and it's happened in an incredibly short time frame.  That's really unfortunate.<br /><br /><a href="http://www.techdirt.com/articles/20090702/0346555437.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090702/0346555437.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090702/0346555437.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>anti-fan-is-not-a-good-thing</slash:department>
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<pubDate>Thu, 4 Jun 2009 11:11:00 PDT</pubDate>
<title>Yet Another Study: 'Pirates' Are Actually Industry's Best Customers</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090604/0117405122.shtml</link>
<guid>http://www.techdirt.com/articles/20090604/0117405122.shtml</guid>
<description><![CDATA[ We've already seen a bunch of nearly identical studies, but it's worth pointing out that there's yet another study coming out this week that says <a href="http://latimesblogs.latimes.com/technology/2009/06/bittorrent-vuze-survey-purchasing-dvd.html" target="_new">that those involved in file sharing also tend to be the <i>best customers</i> of the entertainment industry</a>.  Now, it's worth taking the study with at least some grains of salt, given that it was funded by Vuze, a company trying to sell licensed videos via BitTorrent and has had trouble getting content companies to sign on.  However, given how many other studies have said the same thing, can we finally put to rest the idea that those who file share "aren't customers" as many in the entertainment industry insist?  They <i>do</i> tend to be customers, and frequent ones as multiple studies have now shown.  The issue is just that they <i>also</i> file share, meaning many file share, in part, to find out what's worth buying.  So the focus should be (once again) on giving them <i>reasons to buy</i> rather than trying to stomp out file sharing.<br /><br /><a href="http://www.techdirt.com/articles/20090604/0117405122.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090604/0117405122.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090604/0117405122.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>again-and-again-and-again</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090604/0117405122</wfw:commentRss>
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<pubDate>Fri, 15 May 2009 03:21:00 PDT</pubDate>
<title>Just Because You Offer A Free Service, It Doesn't Mean Your Users Aren't Customers</title>
<dc:creator>Carlo Longino</dc:creator>
<link>http://www.techdirt.com/articles/20090513/1016154870.shtml</link>
<guid>http://www.techdirt.com/articles/20090513/1016154870.shtml</guid>
<description><![CDATA[ The world of Twitter got its collective knickers in a twist earlier this week when the company <a href="http://blog.twitter.com/2009/05/small-settings-update.html">made a change</a> to the settings of its service. The particular change was pretty small, but seemed to disproportionately effect "power users" and early adopters, so, of course, the uproar over it was pretty intense, and Twitter <a href="http://blog.twitter.com/2009/05/we-learned-lot.html">changed the change</a>. The details of the change aren't all that important, but like with the response to Facebook's recent <a href="http://techdirt.com/articles/20090217/1144233799.shtml">TOS change</a>, it's dragged out some rather interesting opinions. A personal favorite of mine is the response to the backlash that <a href="http://news.cnet.com/8301-13505_3-10239527-16.html?part=rss&#038;subj=news&#038;tag=2547-1_3-0-20">since users aren't paying anything for these services, they have no right to complain</a>. Apparently users should "pay up" so they have the right "to voice [their] displeasure as a customer rather than as a user" -- and this coming from a guy who writes a blog about open-source software. It's one thing for a business to ignore complaints that don't come from customers or potential customers, but in the case of free services, to imply that users' opinions don't count because they're not ponying up any cash is fairly ridiculous. Most free services rely on their users to create revenue in other ways, such as by providing traffic to monetize; alienation of users that results in a downturn in traffic, and in turn, ad revenue, has exactly the same effect as losing paying customers' repeat business. The distinction between "customer" and "user" is, in many cases, becoming increasingly irrelevant. And never mind that in many instances, such as with Twitter and Facebook, it's impossible for users to become paying customers. It's hard to imagine that either company thinks it's okay to ignore its users simply because they don't pay.<br /><br /><a href="http://www.techdirt.com/articles/20090513/1016154870.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090513/1016154870.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090513/1016154870.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>blurring-the-lines</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090513/1016154870</wfw:commentRss>
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<pubDate>Fri, 1 May 2009 18:35:00 PDT</pubDate>
<title>Stardock CEO: Focus On Your Customers; Don't Worry About Pirates</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090501/1220064718.shtml</link>
<guid>http://www.techdirt.com/articles/20090501/1220064718.shtml</guid>
<description><![CDATA[ Given our earlier posts about Stardock's new game, Demigod, and how the company was <a href="http://www.techdirt.com/articles/20090417/1603504545.shtml">dealing</a> with the fact that there were plenty of <a href="http://www.techdirt.com/articles/20090428/0213514675.shtml">unauthorized</a> copies, this shouldn't be a surprise at all:  The company's CEO has taken to his forums to make it clear that, while no one likes unauthorized copies, his job <a href="http://forums.demigodthegame.com/349758" target="_new">is not to worry about "pirates," but to focus on pleasing his <i>customers</i></a>.  And on that front, the game has been a huge success.  In his post, he points out that even if the game had been a failure, he wouldn't be blaming it on pirates, but on the company's own mistakes -- but, of course, the game hasn't been a failure.  It's been selling like crazy.
<br /><br />
This isn't new or surprising. It's what Stardock has always said.  And it's the same sort of attitude that others who have found success with content these days have had, as well.  It's never pleasant to find someone is copying content/software/whatever you've made, but you can't worry about them.  It's a waste of time and effort.  People will always make unauthorized copies, and any effort to stop them will only hurt those who actually want to give you money.  So focus on providing real value for those who want to buy, and stop worrying so much about everyone else.
<blockquote><i>
The reality that most PC game publishers ignore is that there are people who buy games and people who don't buy games. The focus of a business is to increase its sales.  My job, as CEO of Stardock, is not to fight worldwide piracy no matter how much it aggravates me personally. My job is to maximize the sales of my product and service and I do that by focusing on the people who pay my salary -- our customers.
</i></blockquote>
You can waste an awful lot of energy and resources "fighting pirates" and losing, or you can focus on actually serving your customers and making money.  Which seems more intelligent?<br /><br /><a href="http://www.techdirt.com/articles/20090501/1220064718.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090501/1220064718.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090501/1220064718.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>exactly</slash:department>
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