What Shawn Fanning And Henry Ford Have In Common

from the starting-revolutions-that-made-incumbents-sue-customers dept

We have a situation where we have an upstart company that understands the impact of new technologies and how to take advantage of them to give people a product they want at a reasonable price – something existing companies refuse to do. An industry association representing those companies goes on and on about intellectual property and starts lawsuits against the upstart. When that doesn’t do the trick, they actually start suing customers of the upstart to try to scare people away from doing any business with the upstart. Talking about the music industry and Napster? Nope. The same thing happened a century ago when the Association of Licensed Automobile Manufacturers sued Ford Motor Company’s customers for buying “unlicensed” cars. As the RIAA’s lawsuits are doing today, this tactic angered the folks who were most interested in cars, and turned public opinion vehemently against the old line industry. The authors of the article have borrowed (nothing wrong with that, right?) a line we’ve used here often enough: “suing your customers is not a business strategy.” The article here suggests (again, as has been discussed here more than a few times) that there are plenty of business models that can be created around the idea of free, unrestricted music – and if the old industry doesn’t figure out how to embrace them, other companies will. However, listening to the lawyers does not make business sense. No one is saying that they can’t sue – we’re just saying that they shouldn’t sue.

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Comments on “What Shawn Fanning And Henry Ford Have In Common”

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Anonymous Coward says:

Let me guess....

They were both balding, rich geeks by the time they were 40?

oh, no… that’s what the *will* have in common.

Let’s understand something about the two “industries” before we start getting all sentimental about avoiding repeating history by studying it.

Ford didn’t succeed because legal stragety failed. He succeeded because the industry needed his ideas and critical investors realized this. Ford figured out how to manufacture and assemble physical goods who’s primary market limitation had to do with cost to the consumer.

Music, once assembled once by the recording industry, has an almost zero cost of reproduction and distribution. The industry has the production and popularization of music down to a fine art and they don’t really need any help with the reproduction/distribution aspect of their business. So, what’s Fanning’s big accomplishment? The discovery that if you give something away for free that people normally pay for, 99% of the folks out there will take it? That’s not revoluation or even evoluation… it’s just plain stupid… esp. if you don’t “own” the music that you’re encouraging people to take.

So, let’s get something straight; Fanning != Ford, not even remotely. Just because the legal profession decides to use an industry’s stupidity to line their pockets doesn’t make Ford and Fanning or anyone else similar.

Now, go back and re-think your essay and write another one about why the RIAA is fscked in the head and destrying their industry without even realizing it (hint: it has something to do with the price point of early automobiles and the underestimated consumer demand for them at the right price point).

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