Tag Archives: business model

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Apple quietly unlocks the gate in the garden wall

Well, well, well – chalk one up for market forces. Remember Apple slamming the gate on the iOS app ecosystem walled garden by insisting on in-app subscriptions with a 30% rake-off? Lots of sad faces among former evangelistas of the iPad-as-future-of-publishing that week.

But now, perhaps due in part to big-name venues like the Financial Times refusing to play ball and opting out of the ecosystem, or perhaps just due to a realisation that a walled garden excludes as many customers as it potentially encloses, the Cupertino crew have quietly back-pedalled on the whole idea.

And so a restrictive information-channelling business model is scaled back due to opposition from other businesses and the customer base, all without the need for any heavy-handed regulation or monopoly inquests; who’d have thought, eh? 😉

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Cory Doctorow lays down his not-actually-a-manifesto

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The more famous Cory Doctorow gets, the more people try to knock him down. I’m quite fond of him myself (he’s very charming in person, if somewhat perpetually part-distracted*), but while I’m not going to argue any sort of superhero status for the guy (I’ll leave that to Randall Munroe), when it comes to puncturing the poor arguments of his most vocal critics, he’s got undeniable flair. Witness his recent retort to an article that accused him and other net notables of profiteering from their “evangelism” of “free” business models for creatives, which also acts as a pretty good summary of the state of the artistic marketplace and the ongoing copyright wars. A few snippets:

What should other artists do? Well, I’m not really bothered. The sad truth is that almost everything almost every artist tries to earn money will fail. This has nothing to do with the internet, of course. Consider the remarkable statement from Alanis Morissette’s attorney at the Future of Music Conference: 97% of the artists signed to a major label before Napster earned $600 or less a year from it. And these were the lucky lotto winners, the tiny fraction of 1% who made it to a record deal. Almost every artist who sets out to earn a living from art won’t get there (for me, it took 19 years before I could afford to quit my day job), whether or not they give away their work, sign to a label, or stick it through every letterbox in Zone 1.

If you’re an artist and you’re interested in trying to give stuff away to sell more, I’ve got some advice for you, as I wrote here – I think it won’t hurt and it could help, especially if you’ve got some other way, like a label or a publisher, to get people to care about your stuff in the first place.

But I don’t care if you want to attempt to stop people from copying your work over the internet, or if you plan on building a business around this idea. I mean, it sounds daft to me, but I’ve been surprised before.

[…]

I understand perfectly well what you’re saying in your column: people who give away some of their creative output for free in order to earn a living are the exception. Most artists will fail at this. What’s more, their dirty secret is their sky-high appearance fees – they don’t really earn a creative living at all. But authors have been on the lecture circuit forever – Dickens used to pull down $100,000 for US lecture tours, a staggering sum at the time. This isn’t new – authors have lots to say, and many of us are secret extroverts, and quite enjoy the chance to step away from our desks to talk about the things we’re passionate about.

But you think that anyone who talks up their success at giving away some work to sell other work is peddling fake hope. There may be someone out there who does this, but it sure isn’t me. As I’ve told all of my writing students, counting on earning a living from your work, no matter how you promote it or release it, is a bad idea. All artists should have a fallback plan for feeding themselves and their families. This has nothing to do with the internet – it’s been true since the days of cave paintings.

I believe the appropriate phrase is “zing”.

[ * After appearing on a panel with Cory at Eastercon 2008, to which he managed to contribute more thoughts and ideas than the rest of us put together despite busily battering away at a netbook at the same time, a friend from the audience suggested a hypothetical version of posthuman bear-baiting: the game would simply involve installing Cory within a Faraday cage that blocked all wi-fi and phone signals, and then betting on how long it would be before he spontaneously combusted from sheer frustration… ]

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DRM may suck, but avoiding it is no panacea to piracy

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As a fellow-traveller of the copyleftists, this is the sort of story I’d rather not be reading. But it’s an important one, because it underlines the problem that all the optimistic rhetoric in the world can’t sweep under the carpet: the point-and-click adventure game Machinarium was released without DRM, and despite (or perhaps because of) great reviews, suffered from an estimated 90% piracy rate. The developers are now having a “pirate amnesty” where they invite people with pirated copies to cough up $5 – a quarter of the original asking price – to legitimise their installation.

So much for the myth (albeit rarely stated directly) that DRM-free games are less likely to be pirated because they give the players their oft-demanded flexibilities of installation and migration; disappointing, perhaps, but hardly surprising.

However, it’s worth bearing in mind that the piracy rate would probably have been similar even if DRM had been baked in to Machinarium. So what’s the way out of this bind? My guess (and it is a guess) would be a lower price point – maybe if the asking price had been $5 from the outset, more people would have coughed up in the first place. The counterargument to that usually goes along the lines of “but that won’t cover the overheads of making the game!”; the counter-counter-response is “well, charging $20 obviously hasn’t achieved that either”. Quod erat demonstrandum.

Then there’s the MMO/metaverse model: charge very little or nothing for software and access, and make your rake-off through in-game items. We know this one works, because if it didn’t there’d be no goldfarming outfits in developing nations… but how to adapt it to single-player gaming experiences? Or maybe you have to look at sponsorships, in-game advertising and product placements… none of which sound particularly appealing, but would probably become accepted by players pretty quickly once there were no other options…

… and given the way things are going, that might not be too distant a day. What this story makes clear is that DRM is a blind alleyway: whether you include it or not, you’ll still have your work pirated. The web burgeons with suggested alternative business models for computer games, but to my knowledge no one has yet made one of them really stick.

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RecycleMatch seeks to match bulk waste with people who can use it

File under “business models I really wish I’d thought of first”: RecycleMatch seeks to match…

… waste streams and under valued resources with potential users of the resources, to help create new revenues and savings for the companies participating – while at the same time having a positive impact on the environment. Our goal is to create an industrial ecosystem in which the use of energy and materials are optimized, waste is minimized, and there is an economically viable role for every product of a manufacturing process.

Seems simple enough, doesn’t it? And what a great idea – an eBay for corporate by-products! [via MetaFilter]

One wonders how well it would be policed if it took off, though; if a system like this got big enough (think eBay at its peak), it could become a clandestine clearing channel for getting rid of waste that you’re not supposed to have produced in the first place, or acquiring waste that you intend to use for purposes rather less than environmentally-minded…

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How to make two million bucks in a day legally

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It’s easy: all you do is sell a sparkly horse upgrade to your MMO client base.

… this morning Blizzard announced the online sale of a new “celestial steed” for use in WoW.    These mounts cost $25 (on top of the retail price plus $15 monthly subscription).  So in a world of free games and virtual items selling for a dollar or two, how popular could a $25 sparkly flying pony be?

Well, the queue for their purchase was at least up to over 91,000 people waiting in the queue earlier today.  When I took a screen shot, it had fallen to “only” about 85,000.

90,000 X $25 = $2,250,000.

In one day.  From one item.  In a game that isn’t free to play anyway.

Also note that the horse in question doesn’t actually do anything different to a regular WoW horse except look pretty. So, there’s money to be made from virtual, intangible and functionless goods… provided you’ve got that client base there with money to spare, natch.

Speaking of mad things you can do in virtual worlds, how about building a Turing-complete 8 bit computer within the game Dwarf Fortress [via MetaFilter]?

All of a sudden the simulation hypothesis doesn’t seem quite so insane…