Sunday, 15 May 2011

Hurry! Free Stuff!

It’s pretty easy to download movies, music and e-books off the net. It’s pretty obvious none of the industries involved knows how to deal with this or which is the best way to proceed.

The problem is the established companies are not interested in just embracing the new. It still has to line their pockets. If the development of digital product results in cutting out the middlemen, then the middlemen aren’t going to like it very much.

Not only will they seek to dissuade people from choosing alternative methods that don’t line their pockets, they will actively try to fuck things up.

I’m particularly interested in how e-books will develop now that the age of the e-reader is upon us (this will probably be how Skynet gets started). Books are easy to pirate, there’s lots of demand,  and they take seconds to download. What can you do? I think an interesting way to see what the future has in store is to look at the rise of the podcast.


What marks out podcasts from other parts of the entertainment industry is that they have no established business model. There is no one to fight for the preservation of traditional podcasting because there is no traditional podcasting.

Although it is an excellent way to disseminate information on any number of subjects, the most popular podcasts are basically people chatting in an amusing fashion, usually hosted by comedians. Most of these podcasts are free, with huge audiences and very cheap to make — the search for a way to monetise them has been something of a Holy Grail.

The first attempt at monetising podcasts was to approach it like cable. You pay us so much per month, we give you X amount of shows. The only major player to have successfully established a subscription service is Jimmy Pardo's Never Not Funny. This was an early hit in the podcast world and built up a big, loyal following. 

They then switched to a season ticket model where you buy 30 or so one-hour plus episodes for about $20, which are uploaded over the course of a year. I don’t know of any other podcast that has managed this feat.

What most comedians have done is to use the podcast as a marketing tool. By listening to a one-hour show the comedian drives up demand for his live appearances and merch. This has worked very effectively for some minor comedians who were stuck in the middle of showbiz. WTF with Marc Maron (intimate interviews with comedians and actors) and Doug Loves Movies with Doug Benson (chatting about movies with his comedian friends) are two excellent examples of this.

Benson has stated he is a stand-up first and foremost and as long as he’s selling out performances he is happy to self-fund his podcast.

Maron uses a donation button to ask for support with his costs, but to be honest he is getting a huge payback for his investment anyway. He has gone from virtually unknown outside the comedy community, to leading light over the last few years. He used to not even be able to sell out his own CD recordings (and very amusingly makes note of this on the CDs). He now sells out clubs.

Both these comics were more or less ignored by the mainstream media. Limited slots and a preference for vanilla acts had seen all but the occasional token ‘alternative’ act pushed into the margins.

My conclusion is that what makes podcasting work (beyond all common sense) is goodwill. It is about building a relationship between product provider and recipient. Once the audience starts appreciating what is being offered to them for free they in turn will support the artist — but not necessarily in the way you want them too.

Sometimes it is in straightforward exchange of cash for services rendered, but more often it is a nebulous approach where the audience turns out to see the artist in public, raises awareness across the internets, forms communities based on a mutual appreciation, and generally pushes for the artist.

With the internet allowing distribution and access to the marketplace on a par with the major players, the obvious route to success would be to build up a following through a free exchange of ideas and interests. And it will be the audience who decide worth, not some predetermined estimation that a book should cost 9.99, or that a movie is worth more than a TV show. Patience, the nemesis of the business-minded, will be the commodity of greatest value.

In terms of book publishing, the big loser is most likely going to be the publishing companies. Writers can make money direct from the reader. Readers will have personal relationships with the writer, and so will be less likely to steal from them. The role of the middlemen, to provide investment for production, to facilitate distribution, and market  the product, is reduced to roughly zero. Expect them to come out fighting. Dirty.

20 comments:

Laoch of Chicago said...

I think podcasting can be quite profitable. Leo Laporte with his TWIT network is reputedly making more than a million dollars a year personally through advertising on the podcasts on his network.

J.A. Beard said...

The publishing companies already have come out fighting dirty. They've beat the online retailers into submission on agency versus retail pricing for instance. I know it's a very complicated issue, but when you cut right through it all, it really smacks of, "We must protect our old business model at any cost, no matter if it messes with the end-consumer or what."

I would have thought the publishing companies would have tried to learn some of the lessons from the music and movie industries, but perhaps they were banking way too hard on the "special cultural status"* of physical books.

*I used to see phrasing like this very commonly 2-3 years ago from people discussing e-books from readers, agents, and the occasional editor suggesting that people just would never accept e-books on any sort of wide-scale.

I still see it a bit on occasion, but in an age where agencies are turning themselves to mini e-publishers and the Big 6 are now banding together to form their own eBook online mega-store, I think people have finally accepted the future has arrived. ;)

mooderino said...

@Laoch - there are some podcasts that use advertising but I'm not really sure how effective it is. Especially as the big thing about them is podcasts are globakl, while advertising tends to be local.

@JABeard - I think as schools take up e-readers (inevitable just from a financial view) kids won't have the same love of books we do.

The big companies are trying to reatard the change to ebooks using outrageous pricing etc., but the switch has already started and there's nothing they can do. Still won't stop them acting like asses to squeeze every last penny they can from the old model.

Alex J. Cavanaugh said...

I'd think publishers need to make some of the changes we saw in the music industry.

mooderino said...

@Alex - I agree, but the music industry fought tooth and nail against the changes. It's one of the reasons iTunes has the field all to itself, everyone else was trying to Canute the tide backwards. I fear the publishing industry will do likewise.

CBame13 said...

I see podcasting going towards promoting pay sites by giving a taste of what is available on the full site, but leaving it as a tease to get people to pay 19.99 a month to be amused or informed.
I've seen instances of these kinds of sites marketing their services through a short amusing video, but whether they will move that to podcasting or not is yet to be seen (at least by me)

Donna K. Weaver said...

Come out fighting dirty, huh? Too bad they can't just learn to play in the new game.

Liz Fichera said...

I do love my e-reader and e-books, although I do it the old-fashioned way and actually buy them (or download from my library). I think people who pirate e-books should be thrown into vats of hot wax.

I like the idea of podcasting for/by authors. It sort of reminds me of vooks, although I don't think those have taken off just yet.

N. R. Williams said...

Good point. At present there is nothing we can do but hope that readers will honor the writer and purchase from them and not a pirated industry.
Nancy
N. R. Williams, The Treasures of Carmelidrium

mooderino said...

@cbame13 - it's possible, although with all the free stuff out there it'd be hard convincing people they need to pay for stuff they can easily get for gratis.

@Donna - I agree, but some kids don't play well with others.

@Liz - I have no idea what a vook is. Must go look it up.

@Nancy - I think if we develop relationships with our readers there's every chance they will pay for stuff, as long as it isn't ridiculously priced. Maybe.

Thanks for all the comments, guy. Much appreciated.

Jeffrey Beesler said...

Well in the event that the companies do try to make a muck of things, they will only succeeding in making matters worse for themselves. People will still be willing to pay for content if they see an actual value for it.

Brent Wescott said...

In the book Free by Chris Anderson, he talks about this free exchange of ideas and it's exactly as you say. Once there's a relationship with an artist, you're more willing to support that art monetarily. He points out that most artists (writers, musicians, what have you) can actually make most of their money through public appearances. Anderson says even though he gives that book away for free, he'll make money through speaking engagements. This all sounds interesting to me, but it's not how I want to make money as a writer. Is this just one more change we have to accept in the modern world?

mooderino said...

@Jeffrey - yeah, but I doubt it will stop them from doing it anyway.

@Brent - I think we're changing from a system where only the chosen few got to go to the magic kingdom, where they made a shed load of money for doing very little. Now many more people have access, but the rewards are smaller.

I think generally when people complain about unfairness, what they really want is continued unfairness, just in their favour.

I think people will have to work much harder for their coin in the new system.

Michael Offutt said...

I listen to some world of warcraft podcasts.

Brent Wescott said...

You're right. It's not unfair if it works out for me.

Michael Di Gesu said...

Mood,

I really enjoy your posts. This one in particular has some really valid points and information.

Thanks for informing us your incisive views.

Stephen Tremp said...

Everything has changes in the past few years. Its not just a tech revolution. Its a cultural one. Now we can see what's happening in repressed countries that are uprising against their governments. Very cool.

mooderino said...

@Michael Offutt - are you sure you want that made public?

@Brent - lol, exsctly.

@MDG - cheers, Michael.

@Stephen - Are you saying the employees of Random House should rise up against their overlords?

The Golden Eagle said...

Interesting post--as for what will happen to the industries affected by digital media, I think it's mostly wait and see. Either they reassess things and change their strategy with some measure of success or they end up losing as people get things from other sources.

Charmaine Clancy said...

I am a podcast addict, and I think they do add value to your writing if done well. The ones that post weekly then stop for six months annoy me, but regulars like Litopia and Writing Excuses are brilliant and I believe exist on sponsoring and commissions on products (like audible.com). There is a knack to it and the host needs a good voice (I definitely do not have a good podcast voice).
I'd prefer to pay for an audiobook than listen to a narrative in sections via podcast though.
It is interesting to see where the ebook is heading, and that's what's been on my mind this week too :)

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