26 May 2009
Traveling
I'm currently in Europe for the next month so posts will most likely be absent. Expect stories/thoughts/etc when I return towards the end of June.
19 May 2009
Lincoln, NE
I don't live in Lincoln anymore and probably won't again for a long time. I would like to eulogize my experience there from the past 5 years by listing out some of my favorite things about Lincoln, Nebraska. Sorry if this gets a bit long, but it should be in an easily skimmable format. You can also check out all of the places on this list on a Google map I created here.
Food
I love eating out, and Lincoln has a surprisingly wide variety of food options available in a small radius. Below are a few of my favorite restaurants in Lincoln in no particular order. Every one of these restaurants (with the exception of Bison Witches) is locally owned/run as far as I am aware.
Coffee
I spent a lot of time as a student at Coffee Shops around town. Below are a couple of my favorites with a brief description. All of these shops are local, offer wireless (except maybe a couple of the smaller Cultiva locations), and offer whole bean or ground coffee for sale.
This list wouldn't be complete as a University student without mentioning at least a few of my favorite bars.
Just some random places that don't fit into the categories above but are worth mentioning:
Food
I love eating out, and Lincoln has a surprisingly wide variety of food options available in a small radius. Below are a few of my favorite restaurants in Lincoln in no particular order. Every one of these restaurants (with the exception of Bison Witches) is locally owned/run as far as I am aware.
- The Oven -- Amazing Indian food. Definitely try their mulligatawny soup. The place also has a cool laid back atmosphere and is pretty reasonably priced.
- Thai Garden -- Pretty good Thai food and you can't beat the price-- or the bridge you cross as you enter. This is my favorite Thai restaurant in town.
- Magnolia -- When I first walked into Magnolia, I expected it to be quite expensive, but it turned out to be very reasonable. The atmosphere inside is as fancy as you'll find downtown. The food is also delicious, and nearly half their menu is vegetarian options. It makes a great date restaurant.
- Lazlo's/Fireworks -- Lazlo's is a locally owned brewpub for Empyrean Brewing located in the Haymarket (original), South Lincoln and Omaha. It is the go-to place for delicious American food and good beer in Lincoln. Fireworks is another restaurant owned by the same people that specializes in wood-fired cooking.
- La Paz -- My favorite Mexican restaurant. Margaritas are a must here.
- Bison Witches -- Not your typical sandwich/soup joint. This place offers huge sandwiches and delicious bread bowl soups. They also have great happy hour beer specials from 4-7. This is a popular lunch stop so if you're planning to go over the noon hour, be prepared to wait.
- Yia Yia's -- Best bottled beer selection downtown, and it's a Pizza joint. Their pizza by is also very good and is made by the slice to your liking. This is a great place to just hang out, have some pizza and beer, and relax to some good music.
- The Watering Hole -- 12 grilled hot wings please. Hands down the best wings in town, served with good beer. My friend also tells me they have the best veggie burger in town, but I was never able to actually order anything other than wings once I stepped in the door.
- Bread & Cup -- A fairly new sandwich/soup shop that offers other dishes at their leisure. They also have great people, good beer/wine, and fresh baked bread. This is one place I wish I would have gone more often while I lived in Lincoln.
- Thé Cup -- Another sandwich/soup restaurant, but is not open in the evening and serves good coffee rather than beer/wine.
- Maggie's Vegetarian Wraps -- A small local restaurant in the Haymarket that makes delicious wraps/soups/etc. They strive to use local ingredients when possible so some of their menu items are seasonal. They also don't take credit cards, so bring some cash.
- Danny's Downtown Deli -- A nice local deli with very friendly people. Makes a good quick lunch stop.
- Ivanna Cone -- Homemade ice cream done right. They always have new flavors for you to try out as well as some of the classics. This is hands down the best ice cream in town.
Coffee
I spent a lot of time as a student at Coffee Shops around town. Below are a couple of my favorites with a brief description. All of these shops are local, offer wireless (except maybe a couple of the smaller Cultiva locations), and offer whole bean or ground coffee for sale.
- The Coffee House -- This is the college indie crowd coffee shop in town, and my favorite downtown coffee joint. They rotate original artwork fairly often and always have plenty of fair trade/organic coffee on hand. My only complaint is that the wireless is sometimes spotty and electrical outlets are sometimes hard to find during busy hours. They have two separate rooms which is nice-- One for conversation and one for studying, with a smaller third back room that can be reserved for meetings/events.
- Meadowlark Coffee -- I started hitting this place more often once I moved off campus. Since it's not near the university, Meadowlark draws a more age diverse crowed, with anywhere from high schoolers and retired people in there at any given time. They also host a lot of community events like open mic nights and poetry slam competitions.
- Cultiva Coffee -- Located near Meadowlark on South Street, this is one of Lincoln's local coffee roasters. They also serve freshly brewed coffee while they are open. Recently they have started serving coffee in the back of Indigo Bridge Books across he hall from Ivanna Cone, and downtown out of the State Theater.
- Kopeli Coffee -- Almost did not throw this one in here. The coffee at Kopeli is so-so, but they have delicious lunch soups and paninis, their wireless is usually superb, and they are open later than most places, so it gets visited fairly frequently.
This list wouldn't be complete as a University student without mentioning at least a few of my favorite bars.
- Doc's Place -- Doc's is a great lounge, but a little bit out of the way from most of the bars. They have a good beer selection and fairly reasonable prices for the most part. Typically draws an older crowd.
- Zen's Lounge -- Zen's used to be my favorite bar before they raised their prices, now it is probably the most expensive bar downtown, but is still worth visiting occasionally. They have a nice beer and cocktail list with some originals created by their bartenders. The lounge also has WiFi should you feel the need to work over a beer.
- Duffy's Tavern -- The home of the fishbowl, Duffy's is a great all-around bar with pool tables, live music, a beer garden, and a window into the gyro place next door for those late night munchies. They used to do karaoke with a live band on certain nights but I am not sure that is still going on.
- Box Awesome -- This is the place for local music in Lincoln, with shows every Friday and Saturday night at minimum. They also recently remodeled to make the place better for shows.
- Zoo Bar -- A jewel in the center of downtown, the Zoo bar is a blues bar that pulls some amazing acts, both local and national. They have posters on the wall of some famous past visiters and the list is fairly impressive. The drinks are good and the atmosphere is excellent. This is another place I wish I would have gotten too more often.
- 12th Street Pub -- Good drinks, good prices, good people, and live local music. What more do you want? If you get lucky, you might be able to see the famous Nate & AJ band perform.
Just some random places that don't fit into the categories above but are worth mentioning:
- Indigo Bridge Books -- A new, independent bookstore in the Haymarket, featuring books on a variety of topics. As mentioned earlier they also have a coffee stand inside selling delicious Cultiva coffee. This place is also host to The Table, a pay-what-you-want community lunch endeavor focused on bringing people together. I will write more about The Table in a later post.
- A Novel Idea -- A locally owned used bookstore located downtown. They have a surprisingly wide selection of books and a good variety.
- Empyrean Brewing -- I mentioned Empyrean already when talking about Lazlo's, but I feel the need to re-iterate that this is the best local brewery in Nebraska. They also do free brewery tours the first Monday of every month as part of beer school. Make sure you get there early though, as it's a popular event.
- Open Harvest -- A local natural foods co-op. I believe they are currently raising money to build a new, bigger store.
- Haymarket Theater -- I've only been here a couple of times, but I was impressed with the quality of the venue and the shows. The building also hosts a youth theater as well.
- Illuzion Glassworks -- A new head shop in downtown Lincoln. Much of their glass is locally blown and I believe they have plans for a lounge or coffee shop in the front part of the building.
12 May 2009
The Effective Anti-Commons
I occasionally stumble across trends on the internet that frustrate and annoy me enough to write about. One of the most recent is what I like to call the "effective anti-commons." The term is a play on the phrase the tragedy of the anti-commons coined by Michael Heller. This tragedy in a nutshell is when numerous rights-holders each control part of a resource to the detriment of everybody involved. Last summer I saw Professor Heller give a talk* in Redomond, WA about his book Gridlock Economy during which he described the phenomenon in some detail. One of the examples he provided is that most airports are basically unable to add runways due to the land nearby being owned/controlled by too many competing interests. If you want more examples, check out the links above.
* side note: Quite a few of the Microsoft Research talks can be found at researchchannel.org, but god forbid you try to watch the videos on a linux box.
I'm taking the "effective" anti-commons to refer to those situations where control of a resource is split between multiple parties, but through technological barriers rather than through legal rights and restrictions. This happens fairly frequently when dealing with information rather than with physical resources. Technological barriers are necessary because data and other factual information is not copyrightable in and of itself (although the display or compilation of the information may be... the copyrightability of databases is somewhat hazy). So in order to provide protection to a database, companies keep it behind close doors and throw up a scary license that says you cannot copy the facts they display on their website. There have also been attempts to apply the legal concept of trespass to chattels to prevent data extraction techniques such as web scraping.
These attempts to legally control factual content have been hit or miss at best, so organizations have resorted to using technology to protect the data instead, partially because it is so easy to do. In general these barriers exist by default and a certain amount of effort must be spent to remove them (through providing web services or periodical database dumps, etc). This leaves few alternatives beyond web scraping for a third party to access the data. Many third-party sites do take this scraping approach, the most popular are probably airfare aggregators.
In many domains this sectioning off of information is harmful both to the consumer and the provider of the data. A few examples of where this is a problem are listed below.
For consumers:
One area I didn't mention above, because it deserves it's own post (or series of posts) is the identity metadata domain (i.e. social networking sites). However many of the same problems pervade this domain as well.
* side note: Quite a few of the Microsoft Research talks can be found at researchchannel.org, but god forbid you try to watch the videos on a linux box.
I'm taking the "effective" anti-commons to refer to those situations where control of a resource is split between multiple parties, but through technological barriers rather than through legal rights and restrictions. This happens fairly frequently when dealing with information rather than with physical resources. Technological barriers are necessary because data and other factual information is not copyrightable in and of itself (although the display or compilation of the information may be... the copyrightability of databases is somewhat hazy). So in order to provide protection to a database, companies keep it behind close doors and throw up a scary license that says you cannot copy the facts they display on their website. There have also been attempts to apply the legal concept of trespass to chattels to prevent data extraction techniques such as web scraping.
These attempts to legally control factual content have been hit or miss at best, so organizations have resorted to using technology to protect the data instead, partially because it is so easy to do. In general these barriers exist by default and a certain amount of effort must be spent to remove them (through providing web services or periodical database dumps, etc). This leaves few alternatives beyond web scraping for a third party to access the data. Many third-party sites do take this scraping approach, the most popular are probably airfare aggregators.
In many domains this sectioning off of information is harmful both to the consumer and the provider of the data. A few examples of where this is a problem are listed below.
- Recipes -- There hundreds of different recipe collection sites on the web, some of the most notable are Allrecipes, Epicurious, RecipeZaar, etc. I still haven't found one with an open API. There are also a few web scraping aggregate sites like Supercook and Food.com, but surprise surprise they don't have an API either.
- Car Pooling -- There are many carpooling websites, many of which sprang up in the last few years when gas prices were on the rise. Here is a list of 25 of them.
- Guitar Tabs -- Just searching for guitar tabs will bring you quite a few different websites, each with their own collection of tabs. Lyrics websites are the same way.
- Events -- Let's say you have an event coming up in Omaha, NE that you want people to know about, where would you post that event to so people saw it? Yahoo? We Go Places? Eventful? Or maybe a city specific site like Hello Omaha? Yahoo and Eventful at least realize the importance of data-sharing in this domain and provide developer APIs for access to their data.
For consumers:
- Where do I find information? An obvious problem when the information for a domain is split across multiple locations is where to look for something you need. Using recipes as an example, where would one know look for a desired recipe or recipe type? There is little to no way to tell which website has the highest chance of providing the best results. You have little choice but to search all of them (or Google might provide decent results).
- Where do I contribute information? Similar to problem 1, a person has to make a choice about where to contribute information so others can use it. In the case of events, how do you choose a site where the relevant group of users is likely to see it? Different people probably check different websites so you have to post the same information (facts) across many of them if you hope to advertise to the most people (this actually happens fairly often with guitar tab websites).
- How do I most effectively connect with other users? Carpooling is one of those domains where the goal is to connect people to each other. This is incredibly problematic when somebody advertising a ride and somebody looking for that same ride are on different websites. The problem of connecting these people is only a problem because the relevant information is not shared.
- How do I accumulate information? For sites that rely on user-generated content, it is necessary for the owner of the website to convince users to actually generate that content. With an effective anti-commons, websites are forced to compete for users not only as consumers, but also as producers. Through this competition some users choose one website while others choose a different one, and the total amount of usable content for any one website is a fraction of what it could be if the information was shared.
- How do I leverage that information to provide value and attract users? The goal of many web applications is to leverage a set of data to provide value to customers. In many cases the amount of value provided correlates directly to the size of the dataset. In many of the example domains listed above, the amount of value possible increases as the data size increases (carpooling, recipes, etc). As mentioned in problem 1, this data set can be increased quite a bit if information is shared among producers rather than fragmented. With the current model of information hoarding, it leaves the door wide open for web-scraping mashups to come through, aggregate data from multiple websites, and win the market. If the data were shared to begin with, this would be far less of a concern.
- How do I differentiate myself from my competitors? In a free market competition is inevitable and can be a good thing. However competing for data accumulation and hoarding that data is counter-productive for the reasons just mentioned. It is much more useful and attractive to spend your time competing on features, usability, integration, etc built on top of a shared data set rather than shooting yourself in the foot competing on data accumulation itself. Knowing where to actually compete is a basic business principle, and is also a reason many for profit software companies leverage open source software (so they can focus on competing in more relevant areas of the software stack).
One area I didn't mention above, because it deserves it's own post (or series of posts) is the identity metadata domain (i.e. social networking sites). However many of the same problems pervade this domain as well.
Labels:
anticommons,
copyright,
data,
identity,
information,
software,
web 2.0,
webdev
20 April 2009
Customizability in Applications
One thing that bothers me about software fairly often is the lack of customizability. This is one of the strong appeals of open source software and operating systems, in that they seem to be built with customization in mind. Proprietary software typically has a specific feature set that it is built around and tries to be as consistent as possible so as not to confuse users. This post is about thinking through some of the issues associated with customizability, some ways to handle it, and some software that I think does it right.
There are two big issues I see associated with building customization into software:
There are two big issues I see associated with building customization into software:
- Time and Cost -- Customizability is really just another feature that you have to build into software, and it's a big one, especially if you don't design with it in mind from the beginning. The problem here is also that for each new feature you add, you also have to add customizability for that feature so the development time has the potential to increase quite rapidly with the more features you add.
- User Experience Failures -- This is an interesting side effect of customizability. There is the possibility that by allowing customization of certain features of your application, users will be come confused by inconsistencies. This becomes even more of a concern when thinking about the ability to use the software from any computer and expecting it to behave in a similmar manner. If issues like this arise, it can lead to increased support costs.
- User Control/Choice -- Users are given control to shape the software to do what they want it to do and little more. This allows the software to appeal to a wider range of users.
- Avoid Feature Bloat -- Rather than try to handle a majority of user scenarios in your software, including fringe features which may be very valueable to some users but rarely used by the majority, you can allow users to customize the application to include the functionality they actually need. This cuts down on core development time, especially if you crowdsoruce the production of the fringe features to the community itself. Office apps in particular struggle with the 80/20 rule of feature usage, and I think Zoho could do well to mitigate this problem by exploring customizability for their applications.
- Platform vs Application -- By thinking about customizability, you might find an opportunity to transform your software into an application platform rather than a specific application with specific purposes. This will allow the software a far far larger appeal. Twitter is a great example of programming to a platform instead of an application. They could have easily have gone a different route.
- Plug-in Architectures -- Probably the best way I can think of to make your application very customizable is to build the base application that captures the most important or most used functionality, but build it in a way that allows people to build plug-ins that can be easily added on top of the application. This allows the application to take advantage of the crowdsourcing mentioned earlier, especially if you make the plug-ins easy to create. There are a number of examples of this being implemented well including Mozilla Firefox, Lotus Symphony (built on the Eclipse Framework), and Wordpress. Google does a similar thing for Gmail, but as far as I know these are still developed by Google Engineers. I have yet to see a hosted web-app that allows user contributed plug-ins. If anybody knows of one please let me know.
- Configuration Settings -- Most apps have some form of "preferences" page or configuration settings that you can tweak. Unfortunately these rarely go far enough to allow true customizability of an application. The other problem is that these configuration settings are rarely able to be synched across computers, which means each time you change a setting for an application, you need to change that setting on other computers you use that app on as well. This is also a problem for plug-ins, but Mozilla has an interesting solution to the problem they are developing called Weave (It's still in developmet, but you can host your own instance of it if you want to play with it).
- Personas -- Similar to configuration settings, it is sometimes useful for people to aggregate particular settings into profiles or personas. For instance, I might want a certain configuration of a word processing application when I am writing a professional memo versus when I am writing poetry. It would be useful to be able to switch between personas with the click of a button. Once again Firefox comes through here with Profiles, but that is not the most useful solution in many applications as it requires you to restart the application
- APIs and SDKs -- I'll only touch on this one, but the ultimate in customizability is to open up some of your functionality and data through web services or some other programming interface so other developers can actually build other applications on top of your core. This is the final step to becomming a true platform and there are many examples of this being done well, including Twitter and Eclipse.
07 April 2009
My Ideal Music Distribution Model Part II: The Solution
In my previous post I outlined some of the problems with current music solutions in the digital age. In this post I will detail my vision for how I think things should work.
To begin with, I am going to make the following assumptions:
The general framework for accomplishing these goals is to offer a music subscription service similar to Microsoft's Zune Pass or Napster, but without all the bullshit and DRM. It would have the following general features.
Distribution of $$$
The big thing I would like to see is to let people dictate how their money gets distributed. This is important for two reasons. First, it lets people actually understand that they are supporting artists allowing them to make more music. Second, it shows people that their money is not going to some middle man, it is actually going to pay for the value the are getting out of the system.
There could be different options available for where your monthly fee actually goes. A few that come to mind off the top of my head are listed below.
As far as the distribution of the money is concerned, Goal 1 is to let artists keep as much of it as possible. Obviously the service itself would need to take a cut, but this can be mitigated in a few different ways.
How much would it cost?
I don't have the answer to this one offhand, I think it would take a decent amount of research to find a price-point that would most likely be profitable to both the service and artists. One option might be to experiment with a "pay what you want" scheme, although that might be too risky without setting a minimum price as well (say $10?). However by setting a minimum price I have the feeling that it would entice people to pay just the minimum.
Summary
The general theory behind all of this is that music has value and people will pay for it. Artists should be receiving most, if not all of this compensation since they are the ones providing the value. Paying for individual songs/albums is no longer a feasible model in today's world, but people should still have a way to make sure their favorite artists are getting paid and supported. I believe this model has the potential to do that, even in a world where people can download music for free (albeit illegally).
Just a final note, I think user feedback would be very important in this system. Showing people a results sheet of exactly how much of their money is going to which artists could increase buy-in and participation.
In the next post I will explore the feasibility of implementing this, who stands in the best position to do it, and possibly speculate some more on the current state of the industry.
To begin with, I am going to make the following assumptions:
- People will pay for music but have a limited budget for it
- People want to be able to own their music, and do what they want with it (e.g.. no DRM, no network connectivity required, etc)
- Get artists as much of a cut of the proceeds as possible (i.e. fuck labels for the most part)
- Allow people to choose how their money gets distributed
- Keep it affordable yet sustainable (tough to find numbers for this one)
The general framework for accomplishing these goals is to offer a music subscription service similar to Microsoft's Zune Pass or Napster, but without all the bullshit and DRM. It would have the following general features.
- For a monthly fee you can stream/download as much music as you want
- Your account is accessible from anywhere with a connection (any computer)
- No 'net connection is necessary to actually listen to your downloaded music
- Music is DRM free and sharable/transferable/etc to any device
- Music you have downloaded is still available on your devices after your subscription ends
Distribution of $$$
The big thing I would like to see is to let people dictate how their money gets distributed. This is important for two reasons. First, it lets people actually understand that they are supporting artists allowing them to make more music. Second, it shows people that their money is not going to some middle man, it is actually going to pay for the value the are getting out of the system.
There could be different options available for where your monthly fee actually goes. A few that come to mind off the top of my head are listed below.
- Audioscrobbler style -- This is really where my idea originally stemmed from. In this model, your money would be distributed based on what artists you listen to in a given month. So lets say 35% of the songs you listen to in that month are by Murder by Death. 35% of your individual contribution would then go to Murder by Death for that month. Sites like Last.fm already have the infrastructure in place to track what you play and log it to your personal profile. It would not be a stretch to extend this and monetize it.
- Socialist style -- In this model your money would get distributed based on the artists who needed it most. There are a number of ways you could determine need, but an easy way to do it would be based on popularity. A user could apportion their subscription fee to the 10 least popular artists they listened to the past month or something. The idea here is that the user is then helping support artists he/she likes so that they are able to keep making music and delivering value to the user.
- Choose your own adventure -- Why not let users just choose which artists the money goes to specifically? Let Sarah give 50% of her subscription fee (minus the service cut) to Rob Costlow if she wants. If Sarah really likes Rob's music that much then she can decide to spend her money that way.
As far as the distribution of the money is concerned, Goal 1 is to let artists keep as much of it as possible. Obviously the service itself would need to take a cut, but this can be mitigated in a few different ways.
- BitTorrent -- BitTorrent could be used to legally distribute and share the music where possible to help cut down on server and bandwidth costs for the service. However it could not be used exclusively, since many artists would not be popular enough to have seeders willing to share. Basically when a user requests to download a song, the service should check the BitTorrent ratio first, then fall back to an actual server if the ratio is insufficient. Alternatively you could have a set of servers dedicated to being BitTorrent seeds and used as a backup for when the number of seeders is too low.
- Advertising -- The service itself could make money through advertising on the website you use to browse/download songs. This could be further enhanced by providing profile and social tools for people to use based around the music (see Last.fm again) to get people to go to the site for reasons other than just search & download.
- Peripheral products -- Artists could also be given the opportunity to sell other items through the site, such as concert tickets, limited edition vinyl, shirts, etc directly to fans. This would also help supplement artist income and could possibly drive revenue for the service.
- Bulk passes -- Offer people the opportunity to pay for a half or full year at a slightly discounted price. This money could then be invested and paid out to artists monthly based on the chosen scheme, with the interest from the investment going to the service provider.
How much would it cost?
I don't have the answer to this one offhand, I think it would take a decent amount of research to find a price-point that would most likely be profitable to both the service and artists. One option might be to experiment with a "pay what you want" scheme, although that might be too risky without setting a minimum price as well (say $10?). However by setting a minimum price I have the feeling that it would entice people to pay just the minimum.
Summary
The general theory behind all of this is that music has value and people will pay for it. Artists should be receiving most, if not all of this compensation since they are the ones providing the value. Paying for individual songs/albums is no longer a feasible model in today's world, but people should still have a way to make sure their favorite artists are getting paid and supported. I believe this model has the potential to do that, even in a world where people can download music for free (albeit illegally).
Just a final note, I think user feedback would be very important in this system. Showing people a results sheet of exactly how much of their money is going to which artists could increase buy-in and participation.
In the next post I will explore the feasibility of implementing this, who stands in the best position to do it, and possibly speculate some more on the current state of the industry.
06 April 2009
My Ideal Music Distribution Model Part I: Background Info
There has been a lot of talk over the last few years about how the music industry as we know it is dying. Awesome. I'm glad. People also like to speculate on where things are headed. Some think iTunes is the future, others think that music will soon be free and become simply a marketing tool for merch/performances. I honestly don't have a clue how the whole drama is going to play out, but in the next series of posts, I am going to describe my ideal music distribution and pricing model.
My basic assumption here is that people are willing to pay for music. Recorded music does have a value and people recognize this. The problem with most of the current and traditional models for monetizing music is that people are unable to afford the amount of music they would like to own. In a nutshell, the value per song of recorded music has dropped significantly, but I don't believe that the aggregate value of music to an individual has dropped at all. It might even have increased.
To put it another way, before P2P file sharing, the medium and distribution of music limited the amount of music a single person was able to access and own. Labels could easily control the price of music because it was a physical good just like any other. There was a certain limit to the amount of music you could put on one disc. With the advent of the Internet and digital music, people all of a sudden were no longer restrained by the physical product. Music libraries increased exponentially. With this new ability, it no longer made sense to limit yourself to the 10-15 songs you could get on one CD for $15. Instead you could have thousands of songs at your fingertips. The problem was that these thousands of songs didn't have a price on them, they were free.
I tried to find some statistics on the average size of a music collection over time, but my brief searching turned up no results. Just to speculate though:
As you are probably aware, 40GB is a modest amount for a music collection these days (I assumed 5MB/Song). Let's assume this is one person. From 2000-2009, that person would have had to spend ~$68/month ($816/yr) on music at the old prices. Few people I know are willing to do this. If it took that person 4 years to get the original 600 songs, that would only be $12.50/month. My assumption is that people on average probably find enough value from music to allocate that much of their budget for music.
So this brings us back to the original problem. The quantity of and access to music has changed drastically, but the pricing models really haven't allowed people to pay for the value they see from it.
Most current solutions to music in the digital age fall far short of understanding and correcting this problem. I'll just canvas a few of them below.
My basic assumption here is that people are willing to pay for music. Recorded music does have a value and people recognize this. The problem with most of the current and traditional models for monetizing music is that people are unable to afford the amount of music they would like to own. In a nutshell, the value per song of recorded music has dropped significantly, but I don't believe that the aggregate value of music to an individual has dropped at all. It might even have increased.
To put it another way, before P2P file sharing, the medium and distribution of music limited the amount of music a single person was able to access and own. Labels could easily control the price of music because it was a physical good just like any other. There was a certain limit to the amount of music you could put on one disc. With the advent of the Internet and digital music, people all of a sudden were no longer restrained by the physical product. Music libraries increased exponentially. With this new ability, it no longer made sense to limit yourself to the 10-15 songs you could get on one CD for $15. Instead you could have thousands of songs at your fingertips. The problem was that these thousands of songs didn't have a price on them, they were free.
I tried to find some statistics on the average size of a music collection over time, but my brief searching turned up no results. Just to speculate though:
Year | # Songs | Cost ($1/song) |
---|---|---|
2000 | 600 (~40-50 albums) | $600 |
2009 | 8000 (~40GB) | $8000 |
As you are probably aware, 40GB is a modest amount for a music collection these days (I assumed 5MB/Song). Let's assume this is one person. From 2000-2009, that person would have had to spend ~$68/month ($816/yr) on music at the old prices. Few people I know are willing to do this. If it took that person 4 years to get the original 600 songs, that would only be $12.50/month. My assumption is that people on average probably find enough value from music to allocate that much of their budget for music.
So this brings us back to the original problem. The quantity of and access to music has changed drastically, but the pricing models really haven't allowed people to pay for the value they see from it.
Most current solutions to music in the digital age fall far short of understanding and correcting this problem. I'll just canvas a few of them below.
- Apple iTunes. Apple was sort of the first big player to step up and try to monetize digital downloads. They have until recently charged around $0.98 per song, but have now moved to a variable pricing scheme where songs can cost $0.69, $0.99, or $1.29 based on popularity. Some people are not too happy with this, for reasons I don't really agree with. I just think it's still too expensive to be a proper solution and some of their music still has DRM on it, which is just absurd. They have sold 6 billion songs through iTunes as of January 2009. Here is the best part, though. The artist cut on each song is probably around 10% if they are on a major label. Does that seem messed up to anyone else?
- Amazon.com. I'm not really sure when amazon started selling mp3s, and I'm too lazy to look it up right now, but it doesn't really matter. Amazon's prices vary some, but typically songs are priced at $0.99 each from what I've seen. Still too expensive, but at least there is no DRM.
- Microsoft Zune Marketplace. Microsoft offers mp3 purchases at around $0.98/song through their zune marketplace, but they also offer a Zune Pass for $14.99/month. The Zune Pass allows you to listen to (mostly) unlimited music from the Zune Marketplace as long as you keep your subscription going. You also get 10 free downloads per month. The huge downside here is that it's basically just paying for on-demand radio... You don't get to keep the songs after you cancel your subscription and you are limited to 6 devices total even while your subscription is going. Napster does something similar. (watch out for the annoying lady if you click that).
- Amie Street. Amie Street is a really cool site that does actual variable pricing based on demand. Songs start free or cheap and can rise to $0.98/song based on popularity. This is a cool little model, and probably close to the best thing out there right now, especially since artists get 70% of the proceeds from each song.
- Magnatune. Magnatune is a Berkely based little site that lets you choose what you pay to download an album/song. 50% of whatever you decide goes directly to the artist. They also refuse to work with major labels (I don't blame them). 50% seems a little low to me, but the choose what you pay scheme is interesting. I'm curious to see how that works out.
01 April 2009
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