Here’s a great link to an editorial from Globe and Mail (published Oct 9, 2009) titled:
Canada’s stumbling blocks
I agree with the author…the problem in Canada goes much beyond a disucussion around newer technologies making their way into the Canadian economy. The problem lies in policy making, in setting the right priorities in economic development. Canada’s heavy reliance and devotion to natural resources has robbed policy makers of interest in pushing innovation, cultivating competition and creating companies that can compete and stand their ground (not get bought out by yet another american firm) on a world stage.
Companies such as RIM don’t come around easily…unless something drastic is done about it!
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My Colleague Max Billings drew my attention to an article by Laura Tunberg recently. While I’ve already made my views clear on this matter in a previous blog post, I have a few things to add here in response to Laura’s article and I’m going to do it MBA style.
1. Paul McCartney talks about how at the end of the day, Piracy is preventing the average musician from earning a decent living. hmm…
Lets do some basic calculations here: An artist on an average receives 1$ per CD sale. Now if an artist manages to sell 100,000 CD’s (mind you, this is a big number for a small artist), he/she receives $100,000 – while the Record Label gets about $700,000. Now take into account the money spent on promoting the artist (which a Record Label conveniently deducts from an artist’s earnings)…how much is our artist really left with.
In our example, if the Record label spent $150,000 in promotions/marketing, then the Artist actually ends up owing the label $50,000! really…Mr. McCartney, in what way does this arrangement seem fair to you?
2. Ms. Tunberg, let me remind you that some of the best examples of creativity and innovation in our society have come about thanks to the culture of piracy and remix…
a) The birth of RADIO !! – legalized and commercialized after pirate AM broadcasting stations gained so much momentum and popularity that a new medium of communication was born.
b) The modern computer as we know it – Developed thanks to the remixing work of a club called the Homebrew computer club! (no points for guessing who some of its members were)
c) “Rip, Mix and Burn” – the iPod!!! (look at the picture below…does it look familiar?)
d) anti-HIV drugs in the developing world that cost a dollar a day as opposed to $27 / day (when produced by American pharmaceutical companies)
e) Hip-hop music, Reggae, the internet, the web 2.0 sphere…the list goes on.
3. Finally, Ms. Tunberg, let me also remind you that the United States at the end of the day is a country built and industrialized through borrowed/copied knowledge. How do you think the term “Yankee” came into being?
Its time to stop fighting piracy…and to start competing with it! It is after all, yet another business model.
I rest my case.
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The music industry now seems to want to get on the Hulu bandwagon. YouTube and Universal Music recently announced that they would be launching VEVO – a site that provides consumers with “premium music video content”. Unfortunately, there are some inherent problems with this concept. I am not sure who is really interested in watching official music videos with advertising, especially when most of this content is already available on YouTube.
Not only is this another display for gutless innovation from the music industry, but its an indication of the pressure that YouTube is feeling in its attempt to monetize its video space (Credit-Suisse Analyst Spencer Wang recently estimated that YouTube would loose close to half a Billion dollars this year).
Additional reading:
http://www.betanews.com/article/YouTube-Universal-Vevo/1239398450
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In its verdict yesterday, the Swedish court has jailed 4 people linked to the popular file sharing site Pirate Bay. Further, Pirate Bay has been asked to pay $3.6 million to various entertainment companies for damages. This verdict marks the beginning of the end!
Pirate culture has been responsible for a lot of the modern day innovations that we see around us today, be it the invention of commercial radio or the web 2.0 sphere (which is allowing me to do this!). Pirates have transformed the media industry, given birth to the remix culture and consequently to Hip Hop and even made available, cheaper anti-HIV drugs in the developing world. Yet we continue to fight this culture.
Today its Pirate Bay’s prosecution, tomorrow it could be the end of “net neutrality” as we know it. I am not saying that piracy is right. All I am saying is that pirate culture has had a remarkable impact on innovation in our society and instead of fighting it through prosecution, we must look to compete with it, on a level playing field (Apple, Apple, Apple…). We must look to provide outstanding value to consumers every step of the way (Look at what Hulu.com has done). In his book ‘The pirate’s Dilemma’, Matt Mason says “Pirates highlight areas where choice doesn’t exist and demand that it does. And this mentality transcends media formats, technological changes, and business models. It is a powerful tool that once understood, can be applied everywhere.”
We need to understand that piracy is a business model in itself and in the words of Steve Jobs, “If you want to stop piracy, the way to stop it is by competing with it”.
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