• You could just take a list from the RIAA & MPAA of "good sites" and "bad sites." That raises a bunch of problems. Let's just start with antitrust. Two trade associations representing the biggest record labels (who've had antitrust problems in the past) and Hollywood studios giving Google (already under antitrust scrutiny) a list of winners and losers? Er... DOJ on lines one, two and three. No way is that legal.
• Even if it was legal, not everyone agrees who is "good" and "bad." It's easy for the RIAA and the MPAA to insist that Megaupload -- for example -- is unquestionably "bad." But... then you have major label artists and super successful indie artists speaking out against the shutdown, pointing out that there were plenty of good things about the service. Why does the RIAA get to decide when some of its own artists feel otherwise?
• The RIAA and MPAA don't have a very good history of recognizing a "good" new thing when they see it. In fact, they seem to scream bloody murder (sometimes literally in the case of the VCR) when new useful tools show up. Letting them program Google's search results seems fraught with problems.
• If search engines let the RIAA and MPAA program their results to point to "good sites" and suppress "bad sites," where does it stop? For years we've seen lawsuits against Google from companies that don't like how they show up in the search results. Why don't they get to reprogram Google's results too? Or pick any random industry out of a hat. Car dealers? I'm sure when you do a search on a car they want results to point to a "good" local dealer, rather than a "bad" site that tells you how to get a better deal on a car. Imagine having to do that at scale where every industry has its own interpretation. And then what happens when those interpretations conflict?
• Okay, so if they don't just give Google a list, how does it "know" the "good" sites from the "bad" sites? Again, remember with Megaupload, we've seen plenty of artists say they like the site or its offerings which actually help them make money. Can Google just assume? How? That's not how Google works. If you have any sense of the scale under which any search engine works you know that's an impossible task. There's no way to just know -- especially since sites that are "downgraded" are likely to just set up shop somewhere new and start again. So at scale, the problem becomes even trickier.
• What if there was a "proxy"? Ok. Like what? DMCA notices? If a site gets lots of DMCA notices, it must be bad, right? Okay, so look at ChillingEffects... and you realize that the sites that get the most DMCA takedowns are sites like Google, Facebook and Twitter. It does't seem like a very good proxy, because sites that are popular get lots of takedowns. It doesn't mean they're "bad."
• An "independent" third party? Who is the third party? How do they take into account the issues above? And, again, if you're doing that for one industry, you'd have to do it for all. And that simply doesn't work at scale.

• We brought in approximately $37,000 total due to this experiment, mostly in the course of that first month.
• Nearly $12,000 came from direct sales to individuals of the tiers between $5 and $150.
• As was revealed in an article at Wired, another $5,000 came from an individual, Didier Mary, who was working on a business plan and bought the Techdirt Reviews Your Business Plan package. The package included an Insight Community conversation, which recently concluded, about his business model idea. Didier has told us that "it was a great experience" and very useful to him in moving forward with his plans.
• Another $20,000 came from larger companies, which purchased Insight Community packages after learning about them through this effort.
• The effort also resulted in potential future deals, as it led many more companies to contact us to learn more about the Insight Community.
• Other companies, with whom we were already talking about the Insight Community, contacted us after we launched this, with one noting that if what his company had been discussing with us was on the list, he probably would have just "clicked buy" right away (though, with that company, we're still discussing a deal and have not yet completed it).
• Ignoring the higher end Insight Community deals, the average amount paid by users was over $70. This was significantly higher than expected.
• Sales came from 15 different countries around the globe. North America and Europe were obviously the biggest, but we also got sales from Asia, South America and Australia (no Africa). The international sales might have been bigger if we had launched international sales the same day we launched the overall effort. Unfortunately, we didn't have all the details on that sorted out until a week later, and I think we probably lost some international sales that way. The US Postal Service does make international sales much easier these days -- especially with its "one rate" boxes, but shipping is still really expensive, and many countries then add annoying tariffs on top of everything. This was annoying, but (unfortunately) unavoidable.
• Our highest selling item was not the cheapest, second cheapest or third cheapest offering (contrary to the claims that people just want the cheapest item). Instead, the biggest seller -- by a pretty wide margin -- was the Approaching Infinity package, that included both a copy of my book and a t-shirt.
• For quite a while, the hoodies (which we almost didn't offer) outsold the t-shirts... but in the end the t-shirts barely passed the hoodies.
• The Techdirt Book Club outsold the Techdirt Music Club by a factor of three.
• No one bought the Day with Techdirt package, though we actually got a lot of inquiries about that, with multiple people who don't live in California saying that if they were closer, they would have bought it. This is still available, though.
• And, fear not, no one bought the $100 Million Silence Techdirt offer (still available as well!), though we did get a few people who were worried that someone would actually take us up on this -- and one satirical offer from someone claiming to be from the RIAA, which made me laugh, saying the RIAA would pay up, but wanted to guarantee "exclusive rights" to the RIAA, such that it would be able to "pursue appropriate legal action against any and all 3rd parties that make use of this silence purposely or inadvertently" including, of course "the right to pursue similar action against any individuals who are also not reading Techdirt and therefore infringing on our own licensed agreement to be the sole recipient of a Techdirt-free world." Brilliant.
• However, the $100 Million Silence Techdirt offer did get the most traffic of any of the tiers, by a factor of three -- though, it also drove many people to check out the other tiers.

1. This works! These sorts of models can absolutely work in connecting with fans and in making money.
2. All of you, in our community, are awesome. Not just for buying, obviously, but because the overall response we got was incredible. This included many really, really nice emails that made us feel great, along with happy emails and Twitter messages from people receiving their packages, and telling us stories about wearing the clothes, reading the books, etc.
3. It's fun making people happy. Really. It really gave all of us here at Floor64 a great feeling every time we heard back from happy community members.
4. Logistics and inventory management are more complicated than you expect. We sort of knew this ahead of time, but you realize it first-hand when somehow, somewhere copies of signed books go missing, and you suddenly need to ask for an author to send extras. Also, dealing with sourcing inventory from so many different people for the Book and Music club is doable, but takes a lot of time to manage. Though, I have to say, every one we worked with -- from authors and musicians to publishers, agents and record labels really were fantastic. We didn't have even the slightest trouble from any of our partners in this endeavor. Shipping out the products definitely was an effort, but we tried to make it fun, with a group of us working together to package up and ship stuff (and on this one, the team here, lead by Gretchen, did a fantastic job, going above and beyond to get everything organized and shipped).
5. Having lots of options was a good thing because we weren't very accurate in predicting what would sell. We came close to not offering the hoodies at all, but those were incredibly popular.
6. You can't keep everybody happy, but you should try! We had to set up a better process for "customer support" as we launched this (nice job, Dennis!) and then work with and respond to customers who had questions or (in a few cases) problems. A few times the problem was that we did not explain things clearly enough, and sometimes there were problems with shipments (or, in one case, a hoodie that was frayed). But we tried our best to make sure everyone was happy and hopefully succeeded (mostly).
7. What you're selling should match your audience. The Book Club sold really well. The Music Club, not as much -- despite being awesome (seriously, the combined Music Club items are really, really cool, and the music is great as well). But, in retrospect perhaps that made sense, as the books in the Book Club directly related to everything we talk about here. The Music Club, while supporting artists who did things that we talked about here, was a bit different, and required people to like the music as well, which is a lot more subjective. Bundling together four separate musicians with different styles was, perhaps, not a great idea. On top of that, we perhaps did not do enough to promote the music itself to get more people to enjoy the work of those musicians. Finally, while some of the offerings were "unique," others could be purchased elsewhere, which limited the "scarcity" of the overall package.
8. Some promotions worked really well. The first promotion we did was offering anyone who bought both the music and book clubs together a choice of either lunch with me or a free hoodie. This helped motivate a bunch of folks to step up and buy -- and resulted in a handful of lunches.
9. Having lunch with people was really, really cool. I have to admit that I was a bit nervous going into the lunches from the above promotion, but they were all really amazing, often in very different ways. Each individual was really interesting and the conversations were quite engaging and thought provoking and fun. I'm pretty sure every lunch ended up lasting well over the allotted hour. I ended up learning a lot and had a great time at every one. I'm hoping to set up more ways to do things like that, if not the same thing.
10. Even the tiers that didn't sell, still generated interest in other things we were doing. A bunch of people contacted us about the Day With Techdirt package, and while no one bought it, many of them bought other packages instead.
11. Not everyone who says they will buy will buy, but that's okay. It was interesting to note that some people who told us they would buy (or even announced it on their Twitter/Facebook feeds) never actually did buy for whatever reason. That's fine, of course. Everyone is free to do what they want, but it was interesting to note. Just because someone says they'll buy, it doesn't mean they will.
12. Communicating directly with everyone can be difficult. While others here handled customer service requests, I started getting a bunch of emails personally from people who participated, sometimes with long and detailed questions. I tried to reply to most of these, but it was difficult, and I'm sure I missed a few.

The business model -- and I do want to make money -- I very much want to make money, and I chose this because I felt I'd make more money doing this than with a conventional distribution deal. What I'm doing is that I'm not selling the content. The content is free. The content is Sita Sings The Blues. It's digital. It's made of 0s and 1s and 0s and 1s can be copied freely and easily by lots of people.... Containers are not free. And where the money comes from is the containers. And the containers, for example, are DVDs, merchandise, t-shirts, 35 mm film prints, physical screenings. The film is free, but the container of that film is not free. And that's what we're selling...

The more the content flows freely, the more demand there is for those containers. So I want as many people as possible to share Sita Sings the Blues because that drives up the demand for the containers... That was the theory when we started this, and so far it has proven correct. Yes, I love money.

• $21,000 in donations (most at the very beginning)
• $25,100 from the store for merchandise (which cost $8,500). So, net: $16,600
• $3,000 from Channel 13 for broadcasting it (even though they didn't have to pay)

It is entirely legal for others to sell unendorsed products. It is entirely legal to sell Sita Sings the Blues t-shirts or sippy cups or whatever, but they cannot claim that the money goes to me, unless they work out a revenue share with me first, they cannot display the creator endorsed mark. We believe that this mark increases the value of the merchandise, because people want to support the artist.