Into The Unknown

We thought we could make money on the Internet, but while the Internet is new and exciting for creative people, it hasn't matured as a distribution mechanism to the extent that lets you trade real and immediate opportunities of income for the promise of online revenue. It will be a few years before digital distribution of media on the Internet can be monetised to an extent that necessitates content producers to forego their fair value in more traditional media.

-- Kyle Broflovski to Stan Marsh, Canada On Strike

So, thought for the day: If a fictional nine year old can explain, in a nutshell, why the Internet doesn't work as a distribution mechanism, why can't the music and movie industries seem to understand that we're still only really playing in the sandpit when it comes to legal digital content? Once the traditional industry heavyweights let the technology organically progress and develop into a ubiquitous distribution channel, letting things like broadband availability and speed, format support and hardware plateau, then they can monetise it. No sooner. We'll look back in five/ten years and see how iTunes was nothing more than a brief (and well-marketed) flash in the pan.

Moving on now - well, hasn't this past week been eyebrow-raising? MySpace officially announcing their (expected) music offering, with three of the four majors on board and the fourth expected to join suit shortly. A hooray! for DRMless downloads, but a booooo! for going with MP3. Another hooray! for (like Amazon) forcing the music labels' hand though on the DRM issue, the fight between AmazonMP3 and MySpace Music is going to a good one if they both continue apace. Though, all that aside, when you have some record labels forging ahead of the curve and going / already offering FLAC or WAV lossless audio for only a little more than MP3s, it makes you wonder why we're still paying so much for digital music - and we're putting up with it!

I know a little about this: for the past nine months I've been on work placement at a small indie label. Our primary revenue stream is iTunes thanks to our 30-year back catalogue, but we still get a pittance in terms of money we actually see from sales. People would be surprised if they found out how little we get from each sale. Only the dominant vendor is the real winner in any online distribution scenario, as they have little overheads, instant content for monetisation, and in this case iTunes also has the closed - and somewhat captive - userbase (for the moment).


TheNextWeb 2008 looked like a big success - a shame the web streaming completely gave up when Diggnation was being filmed. Still, we had a Dutchman telling post-watershed jokes on a live webstream at 5pm, Jim Louderback (bless him) not dropping or breaking something on-stage for once (watch near enough any DL.TV episode he's featured in to see what I mean). And if that wasn't enough, Kevin Rose and Alex Albrecht turned up half an hour late, got ludicrously drunk on stage, were accosted at various points by a kilt-adorned Scotsman and a cheeky PR guy - and to top it off, there was a girl wearing a moustache. I also didn't have to pay $1,000 to watch the live stream. That, and no cost of plane ticket and accommodation to get there... I class that as a win.

In the UK, Ofcom announced their decision and their initial roadmap for digital terrestrial TV's migration to HD [free registration required], and not everybody's happy with them... likewise, the Freeview Consortium's relative inaction (or inability) to wrangle a good solution for the future of digital terrestrial broadcasts, combined with their apparent hatred for good programming and worthwhile use of the available spectrum has irked quite a few people (myself included). My housemate even wrote an open letter to them.

Oh, and in other news, I'm putting together a brand new design for ITU. The current look (Glossy Blue by Nick La, found via BlogCrowds) worked well as a placeholder while I gathered my ideas together, but I hate basing sites on templates (however good they are)... Any designer will know what I mean when I say "It just doesn't feel 'mine' 'til I've done the design." (A poet and I don't know-et.)

Until next time, stay classy.

A recent discussion on Slashdot (and reported on BoingBoing) raises an interesting question: with the commercial world moving ever more towards conditional licencing agreements for games, music, and ebooks, is there going to come a flash point whereby consumers realise they're paying for nothing more than thin air? Or, will the powers that be see the necessity to force a change in law to ensure that people still get what they (think they) are paying for?

It's one of the reasons I've shied away from music rental services (that, and the horrible DRM too), but it's also a driving force behind me actively avoiding ebook and digital media purchases for things like films and TV shows. If we're paying the same as we'd pay for physical media, but we're getting less rights in return (and often, not even a permanent digital copy) why should we even bother paying?

It's definitely one of the factors for the MP3 format sticking around as long as it has (and I fully support open* formats like FLAC and MP3, but I would only hand over money for music in FLAC format at a push for reasons of quality). I'd most definitely never enter into a licencing agreement between myself and a publisher - books are one of those things you can savour, hold in your hand, leaf through the pages or enjoy at your own pace. And, when I'm done with it, and if I don't want it, I can sell it on - can you do that with an ebook? Not likely.

Well, not yet, anyway... But isn't the whole point of digital media that by its very nature, it removes the element of scarcity? Surely the death knell of the humble printed book isn't already ringing?

Can there ever be 'digital rights'? (and can industry ever expect to be able to 'manage' these rather nebulous 'consumer rights' when, arguably, they themselves don't have the right in the first place?)

From the Gizmodo article,

In the fine print that you "agree" to, Amazon and Sony say you just get a license to the e-books—you're not paying to own 'em, in spite of the use of the term "buy." Digital retailers say that the first sale doctrine—which would let you hawk your old Harry Potter hardcovers on eBay—no longer applies. Your license to read the book is unlimited, though—so even if Amazon or Sony changed technologies, dropped the biz or just got mad at you, they legally couldn't take away your purchases. Still, it's a license you can't sell.

But is this claim legal? Our Columbia friends suggest that just because Sony or Amazon call it a license, that doesn't make it so. "That's a factual question determined by courts," say our legal brainiacs. "Even if a publisher calls it a license, if the transaction actually looks more like a sale, users will retain their right to resell the copy." Score one for the home team.

There's a kicker, though: If a court ruled with you on that front, you still can't sell reproductions of your copy, an illegal act tantamount to Xeroxing your Harry Potters. You'd have to sell the physical media where the "original" download is stored—a hard drive or the actual Kindle or Sony Reader. Our guess is that it only gets more complicated from here. What happens when the file itself resides only on some $20-per-month Google storage locker?

There's a full commentary on BoingBoing (and a link to the parent Slashdot story via the Gizmodo article).