February 13th, 2009
Over the past decade, we have built a country-sized economy online where the default price is zero — nothing, nada, zip. Digital goods — from music and video to Wikipedia — can be produced and distributed at virtually no marginal cost, and so, by the laws of economics, price has gone the same way, to $0.00. For the Google Generation, the Internet is the land of the free.
Which is not to say companies can’t make money from nothing. Gratis can be a good business. How? Pretty simple: The minority of customers who pay subsidize the majority who do not. Sometimes that’s two different sets of customers, as in the traditional media model: A few advertisers pay for content so lots of consumers can get it cheap or free. The concept isn’t new, but now that same model is powering everything from photo sharing to online bingo. The last decade has seen the extension of this “two-sided market” model far beyond media, and today it is the revenue engine for all of the biggest Web companies, from Facebook and MySpace to Google itself.
http://online.wsj.com/article/SB123335678420235003.html?a=y
Tags: culture, film, free, innovations
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February 12th, 2009
The real reason that the music industry came around to the idea of downloads wasn’t because they had a startling insight into the future, or even because Apple forced the issue by building a clever ecosystem around the iPod (it didn’t launch the iTunes store until 2003). It was because customers were choosing to pirate instead.
To put it less glibly, the publishing industry isn’t being forced to confront a radical shift in consumer behaviour caused by technology, because that scenario just is not happening. Customers aren’t forcing the issue by choosing to abandon books and read pirated text instead. And this means the problem isn’t there to be confronted.
Oh, yes, there are problems. The publishing industry is having trouble. People aren’t buying books. Sales are down. Websites, supermarkets and megabookstores are taking over from smaller retailers and throttling the market.
But unlike the music business - who saw those lost customers head straight to Napster, Kazaa or Gnutella - the average book reader isn’t turning to legally dubious sources for their novels, or meeting up with book dealers on street corners to pick up copies of the latest bestseller.
http://www.psfk.com/2009/02/kindles-growth-hampered-by-lack-of-pirates.html
Tags: piracy
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February 11th, 2009
Artist Lawrence Yang offers this update to Pepsi’s recently remastered look - A healthy reminder that when you get past the sexy new ads and logo, Pepsi is still Pepsi.
http://www.psfk.com/2009/02/pic-pepsi-logo-redux-again.html
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February 11th, 2009
If retailers are struggling to bring in customers in a rough economic climate, getting personal might be the answer.
According to ChoiceStream, 41% of US Internet users surveyed said they paid more attention to advertising that was personalized. And nearly the same proportion of respondents (39%) said they were more willing to click on such personalized ads.
Still, Internet users respond to personalization, and according to ChoiceStream, the more money viewers spend online, the more likely they are to respond.
“Today’s online consumers understand the value of online advertising and know retailers have information about their shopping behavior that can make their experience more relevant,” said ChoiceStream president and CEO Steve Johnson.
http://www.emarketer.com/Article.aspx?id=1006878
Tags: ads, personalisation
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