You Compete With Free Because You Have To

from the welcome-to-the-marketplace dept

One of the frustrating things in discussing intellectual property issues around here is that every time we suggest a company is making a mistake in its business model, such as by treating its customers as criminals, someone steps up to yell at us for "defending piracy." That's not true at all. We do not, and will not, defend piracy in any form. What we will do, however, is note that most attempts at fighting the piracy are wasted effort that is bad for business and often alienating to legitimate customers. That has been our point all along. Piracy is in the market place and it's simply a fact of the market.

There's increasing evidence to suggest that the best way to "fight" it isn't to lock everything down and limit your legitimate customers, but to change a business model and provide a compelling offering at a reasonable price that people want to pay for. Over time, we've discussed numerous examples of how that works. The simple fact is that some amount of piracy is a market reality -- and there are two strategies to dealing with it. One is to try to fight it directly and lock everything down. That's the path the recording and film industries have chosen, and it hasn't done much to help at all. The other is to admit that not only can you compete with "free" by offering something of value, you can often use the "free" stuff for promotional value -- leveraging that aspect that others in the industry see as a weakness. It's always good to see when companies at least recognize this market reality. Take, for example, this quote today from the head of an Israeli company: "The goal of the world is to beat the Chinese. They don't care about intellectual property. We have to develop something that will take two to three years to copy." In other words, he's recognizing that the market reality is that you have to compete where some element of the market simply won't respect intellectual property laws. That doesn't mean it's impossible and you shut down, but that you adapt to the market and figure out ways to compete anyway.

Reader Comments

Subscribe: RSS

View by: Time | Thread

  1. identicon
    GraphiX, 10 Aug 2006 @ 4:14am

    i just dont get it.

    i dont understand all this i really dont.

    there shouldn't be a need for any piracy there shouldn't be a single reason to DRM everything if only the idiots did it like it was ment to be but no they have to try and complicate everything all the time.

    it's as simple as ABC

    1. supply content on BT or p2p in a subscription
    everyone in that group/subscription can only share the files from that community without dRM.
    they stop paying the monthly subscription
    they cannot continue to share but they keep everything they once traded or downloaded.

    or option 2.

    sell media at a fair price without restrictions tada!!
    how hard is that really? hell that is how it is ment to be in the first place but they had to go and screw everything up as per usual.

    if online services just did what allofmp3 do what more can people ask for as everyone understands that service just works you get what you want when you want for a really good price without restrictions.

    why can't the industry just understand this
    instead of treating everyone as criminals and then moaning and bitching when its not going their own way.

Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here

Subscribe to the Techdirt Daily newsletter

Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Follow Techdirt
Insider Shop - Show Your Support!

Report this ad  |  Hide Techdirt ads
Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Report this ad  |  Hide Techdirt ads
Recent Stories
Report this ad  |  Hide Techdirt ads


Email This

This feature is only available to registered users. Register or sign in to use it.