Multichannel monetization should beat piracy

Nick Bilton writes, "Internet Pirates Will Always Win" and provokes some interesting ideas: is preventing piracy just a game of whack-a-mole?  Certainly, in the current paradigm, it can seem that way.  

I wrote to colleagues in 2007, when Razorfish was in discusions with NewCo (the nascent NBC/Fox JV that would become Hulu) that fighting the desire of content to be easily available (even if not free) was not a viable business strategy.  

Then, as now, this is a matter of ideology, because the people with the biggest ideas about content are rarely in charge of setting its price or licensing terms.  

But in the multi-channel world, with connected devices now a threatening alternative to STB-connected distribution, content players should not forget the power of an engaged audience.  They are a monetizable asset, and even if watching for a far lower prixce, creating a low-price tier with identifiable audience members can produce email opt-ins, social discussions, merchandise/DVD/other revenue, and tune-in for other programs.  

Mr. Bilton quotes Holmes Wilson, co-director of Fight for the Future, in the article:

The hit HBO show "Game of Thrones" is a quintessential example of this. The show is sometimes downloaded illegally more times each week than it is watched on cable television. But even if HBO put the shows online, the price it could charge would still pale in comparison to the money it makes through cable operators. Mr. Wilson believes that the big media companies don?t really want to solve the piracy problem. "

"If every TV show was offered at a fair price to everyone in the world, there would definitely be much less copyright infringement," he said. "But because of the monopoly power of the cable companies and content creators, they might actually make less money."

Mr. Holmes is not wrong about the exciting power dynamic in play - it certainly could be empowering to do something the "man" doesn't want you to do. Nevertheless, exercising our inner Che Guevara is neither an effective mechanism of revolution against the industry nor a stricly pleasurable experience (corrupt and low quality BitTorrrent downloads mostly waste our time, if not our money).  Wouldn't a low-price on-demand stream or download just be...easier?

It's myopic to think that adding many more low-revenue streams is going to lose money; it certainly will if the HBO/HBO Go are your only revenue source.  The MSOs and the premium TV providers have to work together to create experiences and tiers whose scope is beyond the cable system, and where even if the price is lower, the experience is better than piracy, which is, after all, a pain in the butt.  But I'm just an idealist, I know.

GOOG 3G/4G Spectrum Patents from Nortel Key to World Domination

Over at SAI, the chart of the day suggests that ChromeOS is a jab at Windwows (duh) and that Google needs the OS to succeed because it is the best hope to kill a weaker Microsoft.  Despite Microsoft's attempts to break out of the doldrums, and the extreme diversification of their product offerings (many of which never stood a chance of working)- Windows remains the cash cow for the giant.

If I were Google, I wouldn't try to win the war against Windows under current conditions; I would need more things to fall into place.

Android users are wising up to the Google Platform, and applications for Android are proliferating.  Windows Phone 7, how are you feeling?

Bing is getting better, has differentiated itself and is integrating with Facebook more obviously (the future of social search is very scary for any company that does not follow Bing's lead)- that's got to be scary for Google.

ChromeOS apps would all be web apps, and the value proposition would have to involve the cloud, and applications that are enhanced by always on-data networks.  WiFi in the current sense just will not cut it.  You know what would?  3G/4G wireless connectivity built in.  

ChromeOS laptops might be a miserable failure like the Nexus one, but if Google sold them at a loss, they'd exact a far more painful loss on Microsoft.  With onerous license fees from the essential connectivity, Google has to own the key patents in order to reduce its costs.  This illuminates why Google may be fighting so hard against Apple and RIM for Nortel's 3G/4G patents.

When yo sign into Google Apps, use email, docs, spreadsheets, watch Youtube videos in the Chrome browser, and android apps all day, getting served advertising by Doubleclick until you remotely program your Google TV from your android phone and watch The Office when it's convenient for you...that's when Microsoft dies.  And with the exception of GoogleTV, I haven't named one thing above that sucks.  

To do the same thing on Windows/microsoft/Bing/MSN/Xbox, you're making some compromises along the way, for sure.  It's not a done deal, but it's for all the marbles.

Learning from Ninjavideo.net- Give Me What I Want

The last decade has seen information technology  increase productivity and the measurement of marketing, and this has primarily been a gain in efficiency.  I think social technologies trend in the opposite direction by making marketing more powerful, insightful, and satisfying to the target audience.  Having the people's affirmation as a lynchpin of success has done wonders for the quality of many marketing program's.

At a recent NY Tech Meetup, I was introduced to Ninjavideo.net and finally had a chance to try it out.  While the site seems to be hitting its stride in terms of ad monetization, it's possible all this ad-revenue will be clawed back by a copyright infringement lawsuit.  From a usability perspective, the site is great, and THAT is what people want. [side note: consumers (ok, I) will click on nearly anything to get the content we  (ok, I) want].  There is literally no telling what the "Ninjavideo.net Helper Applet" is doing after you're done with it.

Conclusion: The site is one a huge missed opportunity for the major media companies and studios- this is where the people are, and they'll watch ninjavideo.net or its successors until they figure out how to serve the audience rather than enslave them. 

Happy Thanksgiving!

Just in case I don't post over the holiday, Happy Thanksgiving!  Or, Slapsgiving!