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Overhype
by Mike Masnick
Fri, Sep 5th 2008 7:42pm
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Filed Under:
anti-american, business, capitalism, long-term view, maximizing profit
Companies:
habbo hotel
Permalink.
Maximizing Profits Doesn't Mean Screwing Your Customers
from the rinse,-lather,-repeat dept
A few years back, we wrote a post debunking the ridiculous notion spread by some that Craigslist was somehow "anti-capitalist" or not "maximizing profits" because it actually offered most of its services for free. As we noted, much of Craigslist's long-term success was because of these decisions -- which in all likelihood did increase overall profits for the company in the long run by building up further trust in the company. It may not have maximized profits for this quarter, but it most likely was doing a pretty good job in generating profits for the long haul by keeping customers happy, rather than trying to squeeze them for every immediate dime (and who was just saying that Silicon Valley doesn't have a long term view?)
Now we've got another similar story, as the LA Times is positively amazed that the popular virtual world Habbo Hotel limits its users to spending no more than $35/month, on the theory that many of its users are teenagers, who could get sucked into spending on stuff, which could lead to eventual backlash. Its CEO made this clear in a recent interview, saying: "We didn't want a situation where teens were raiding their parents' credit cards to be able to play.... We really don't want teenagers to spend more than the price of two movie tickets a month on Habbo."
So, how does the LA Times describe this decision? It points out, partly in jest, that "turning down money seems un-American." Again, even if this wasn't meant as a serious comment, it's similar to the silly claims about Craigslist. Habbo Hotel has simply made a strategic long-term decision on ways to best maximize its success for the long haul. And, part of that probably included the calculation that Habbo would have been in quite some trouble if news stories started showing up about kids bankrupting themselves buying virtual trinkets for their Habbo Hotel world. Limiting how much people can spend isn't anti-American or anti-capitalist or even anti-profit maximization. It's just taking a much longer term view of the best way to maximize profits over the long run.
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Predictions
by TIC Expert, Kevin Donovan
Fri, Sep 5th 2008 6:22pm
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Filed Under:
discs, formats
Permalink.
Disc Makers Convince Themselves That Discs Are Here To Stay
from the short-run-vs.-long-term dept
Remember all that hype about the paperless office? The paperless home? Heck, even the paperless life! Well, so do some Sony executives who think the persistence of paper proves that Blu-Ray discs is here to stay. Speaking at an expo in Denver, Sony SVP Andy Parsons said, "I'm fond of recalling the old visions of the past that the paperless office would completely obliterate the need for paper. It seemed like a very reasonable, logical prediction decades ago that turned out to be completely wrong." The only problem with this self-promotional position (besides the fact that recent research shows younger people aren't interested in using paper) is that it ignores the many formats of information that have come and gone. Paper is unique in its ubiquity, but Sony should know all about formats which die; after all, they invented a couple. While discs may be around for a while due to existing infrastructure, the clear trajectory is towards digital only as evidenced by the swing towards net-centric devices like Apple's MacBook Air, the iPhone and Dell's new netbooks. As bandwidth and net-connected devices increase, shiny pieces of plastic will disappear (for everyone but the collectors) along with their tape-based predecessors.
Kevin Donovan is an expert at the Techdirt Insight Community. To get insight and analysis from Kevin Donovan and other experts on challenges your company faces, click here.
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Scams
by Mike Masnick
Fri, Sep 5th 2008 10:31am
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Filed Under:
copyright, extortion, pre-settlement, scams
Permalink.
Scammers Copying Big Copyright Extortion Tactics
from the learn-from-the-best dept
It really was only a matter of time. For a while now, the entertainment industry has been using borderline extortion tactics with "pre-settlement" letters that promise individuals they won't get sued if only they pay a fee upfront -- ranging from a few hundred dollars to a few thousand. These letters have proven to be incredibly effective in getting people to simply pay up, so it's no surprise that other scammers have started copying the technique as well. Right now it sounds like they're simply calling people, but it's really only a matter of time until they start sending nearly identical "pre-settlement" letters on threatening letterhead, and getting folks to pay up as well. Of course, given the extremely flimsy nature of the evidence often used by the entertainment industry in sending out those letters, we'll once again note the very fine line between what these supposedly legitimate companies are doing and the out-and-out scammers are doing.
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Culture
by Mike Masnick
Fri, Sep 5th 2008 9:11am
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Filed Under:
barracuda, copyright, heart, john mccain, performance rights, sarah palin
Permalink.
Heart Demanding McCain Campaign Stop Using Its Song
from the not-much-leverage dept
Last month it was singer Jackson Browne suing the McCain campaign for using his song in a commercial. As we noted at the time, since it was used in a commercial, it was most likely infringing, but if McCain wanted to use it at an event, he could as long as he paid the proper performance licensing fees. So, now we have another situation where exactly that scenario has happened. At the Republican National Convention earlier this week, the speakers played the Heart song "Barracuda" for VP candidate Sarah Palin (who apparently went by the nickname "Sarah Barracuda"). This is perfectly legal, assuming that the RNC has paid the required performance license, and there's no reason to think they didn't, given how much music was used at the convention.
But, that's apparently not good enough for the band, who complained and had its label, Sony BMG, and its publisher Universal Music Publishing send cease-and-desist letters to the campaign. On what legal basis? They don't seem to have an answer for that. The whole thing is kind of silly. There's almost certainly no legal leg to stand on here, but it's surprising that the RNC wouldn't check first, given how others, like Browne, have reacted and the fact that the press would almost certainly cover the story (as they are). So, while there may be no legal basis for the complaints, it still is surprising that the RNC and/or the McCain/Palin campaign wouldn't bother to first check with the band to see if the members would be upset about the usage.
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Culture
by Mike Masnick
Fri, Sep 5th 2008 7:34am
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Filed Under:
distribution, free, michael moore, movies
Permalink.
Michael Moore Embraces Free Distribution Of Latest Movie
from the and-another-one dept
No matter what you think of controversial film maker Michael Moore (and I'll admit that I'm not a fan -- I think he's entertaining, but plays way too loose with the facts, even on issues where I might agree with him), over the years this been this odd compulsion by pro-copyright folks to pigeonhole Moore as being against anyone sharing his films online -- despite the fact he's clearly stated he has no problem with people file sharing his movies if it means more people see them. Yet, as we've pointed out, others have claimed that Moore's worst "nightmare" came true when one of his movies was leaked online, despite the fact that the leak helped get it more attention (just as Moore wanted) making the movie quite profitable. Then there was the "legal group" that used one of Moore's films as an example of filmmakers hurt by file sharing -- again ignoring Moore's stated appreciation of fans sharing his movies.
Well, now he's making his stance even clearer. He's releasing his latest movie for free online, though, oddly it will only be officially available that way for three weeks (though, I'm sure by then it will be widely available in unauthorized forms as well). As of right now, it's a little unclear if the movie will be available for actual download or just streaming, though the website for the movie itself, called Slacker Uprising says that it will be a download. I think he's being a bit disingenuous in claiming that he's not planning to profit from the release, as he's also offering a DVD for sale, which will likely do quite well. Either way, perhaps now folks will stop using the leaks of his movies as evidence that he's against free distribution of his movies.
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Culture
by Mike Masnick
Fri, Sep 5th 2008 2:38am
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Filed Under:
anti-fan, fans, guns n' roses
Permalink.
The Last Thing A Musician Wants These Days Is To Appear Anti-Fan
from the guns,-but-no-roses dept
Last week, when we wrote about the FBI's decision to arrest a Guns N' Roses fan who leaked the band's long awaited next album, one of the common responses in the comments was that because GNR had the legal right to do this, it absolutely made sense for the band to have the FBI track down and arrest this guy. While we've pointed it out before, it's worth pointing out again that just because you have the legal right to do something, it doesn't always mean that it makes sense to actually do it.
In the case of GNR, this point is expressed quite clearly by music industry observer Bob Lefsetz, who discusses how badly this whole ordeal is reflecting on GNR:
Fans. They're the hardest thing to acquire. You can buy publicity, you can pay off distributors. There's mutual self-interest. You want to sell and they want to profit. Newspapers don't do stories on acts no one cares about, and television is only interested in stars. But fans are not doing business. There's no financial payoff for being a fan. It's an end-user application. You don't build up your fandom and sell it. You own it. At least until it fades away when the act does something heinous, like stand up to Napster.
That's haunting Metallica nearly a decade out. Metallica was right, but their fans thought they were wrong. And you always want to come out on the side of your fans. Metallica has learned its lesson. But the record labels have not.
And neither, apparently, has GNR. We've discussed in the past how difficult it has been for Metallica to regain the fans it lost as a result of standing up to Napster, and it will be interesting if something similar happens to GNR in this case. Having your biggests fans arrested tends to make people question why they are fans in the first place. It's basically the opposite of the concept of engaging your true fans. These types of actions push them away, and that's never good for business.
40 Comments
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Say That Again
by Mike Masnick
Thu, Sep 4th 2008 10:26am
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Filed Under:
lars ulrich, leaks, metallica
Permalink.
Lars Ulrich On Metallica's Latest Album Being Leaked Online: It's Fine, We're Happy
from the what-have-you-done-with-the-real-lars-ulrich? dept
We've noted that Metallica has basically spent nearly the last decade trying to recover from the damaged reputation the band brought on itself when drummer Lars Ulrich freaked out about Napster and started suing. While the band has been trying to become more online friendly with its latest album release, you still had to wonder how Ulrich would react to the album being leaked online before the official release date. Some might assume he'd pull a Guns N' Roses and try to send the FBI after the leakers -- but, instead it looks like Ulrich has learned at least part of the lesson: don't freak out at your fans for music getting online, even before the official release. In fact, he seems almost mellow about the leak:
"It's 2008 and it's part of how it is these days, so it's fine. We're happy."
It's tough to tell if he's legitimately "happy" about these fans, or if he's just learned enough to grin and bear it for the time being -- but it's nice to see that he's at least learned something since the Napster debacle.
49 Comments
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