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Peering for Dollars: Part 1

Peering for Dollars: Part 1

April 3, 2002
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" Today video distribution accounts for more than 25 percent of all revenue from a motion picture. "

This is part one of a two part series on "Profiting off a Napster Generation, Digital Rights Management, Geo-targeting and a Few Other Buzzwords You Should Know"

Over this past weekend I loaded Limewire, a popular Napster-like peer-to-peer program, onto my computer : and then I watched your content without paying you a dime.

I downloaded your newest movie because someone used a spider to take it off of your site: zero dollars to you after you spent time, money and resources. This is bad for business and is not uncommon in a our world where ideas, content, documents, and opinions meet a mechanism that allows for super-distribution the likes of which no previous civilization has ever known.

Let me throw this at you: Do you go to sleep each night and ask yourself, "Did I remember to lock the front door? Did I lock the car?" You might keep your money in a bank rather than on a street corner with a sign that says, "Hey - this is my money so don't touch it." If you use email you may have a password, even if it is your oldest child's birthday or the year you were married, right? Keys, locks, passwords, codes : these are the tools you rely on to gain access to parts of your world, because they provide you with a level of comfort and safety surrounding that which is most important to you.

As we move about and conduct business in a distributed economy, most take time to ensure that the gates that lock their most important assets are safe and sound. As a content provider or a consultant for, broker for, or marketing arm of a content provider, you must make sure that you protect content on a frame-by-frame basis, too.

Months ago I thought that instead of sourcing or developing a technology to do just that, our group should develop a solution that can allow content to think and follow rules and then bundle it together with a creative and managed "viral marketing" campaign. If we could accomplish that, then maybe we could make people come to a site, pay for an experience or just pay to view content. Wow, what a concept! Traffic, traffic, traffic:. This could only mean money to companies.

"Viral marketing?" you ask. Viral marketing lends itself to the thought that a force takes on a host from which it feeds and grows, and then it moves on. Viruses are spread at high rates and are tough to stop. Those who do not believe in locks may see this concept as a negative, but not all viruses have negative impacts. (And my biochemistry professor swears I never listened.)

Variety Magazine, a leading entertainment industry publication, recently published an article that said News Corp. and Walt Disney Co. have enlisted Washington's help to stop Internet thievery, clearly taking a shot at peer-to-peer technology. News Corp. President Peter Chernin likened the downloading of pirated content to burglarizing a video store. This is the same industry that years ago said VCRs were good only for bootlegging videocassettes. Today video distribution accounts for more than 25 percent of all revenue from a motion picture. If Hollywood was wrong then, they are really wrong today. Remember: This is the same philosophy the recording industry preached so dramatically when it went out of its way to abolish Napster.

Referring once again to the exchange of content via P2P, Chernin continued by saying, "The truth is that stealing is stealing." In my opinion, stealing is only stealing if the content stolen does not generate revenue or serve a purpose to the copyright holder. Now whose fault is that? It is the fault of the content producers themselves, not the engines behind delivery.

My favorite Peter Chernin quote calls what is occurring "a tough generational problem." I think that is a poor excuse, as Fox, a subsidiary of News Corp., goes out of its way to bring us to the lowest common denominator on television (Celebrity Boxing, Cops, Married with Children, That 70s Show, etc.). They, of all people, should not take that square-peg approach - but if that is their belief, I say this, "Think outside the box and work the problem." I guess they will arrest me on the same day that the FCC visits me for my cable box or when the police arrest me for removing those pesky tags that come on pillows.

As we become proactive, I ask you another question: Why would you want to stop a piece of content from traveling throughout the universe spreading your word to the masses? If you were promoting a rock concert and word of mouth sold tickets, you would encourage, push, manipulate, pay off : and relish the success as your dollars poured in. If content is king, end-user traffic represents the people who will allow you to keep the title. As king, you should maintain the right to tax those who wish to cross your Bill Gates. It becomes a 24/7 tax season in which you are the accounts receivable department. That is sweet!

Am I one of the few who get it? I must be, because the U.S. Congress has a bill on the floor that will make consumers liable for their actions if they copy copyrighted works. I guess they will arrest me on the same day that the FCC visits me for my cable box or when the police arrest me for removing those pesky tags that come on pillows. While Congress figures out how to enforce that one, you should worry about what you can do to protect and monetize your "ass-ets."

People have been trading forever, whether it was fur, baseball cards, or electronic content, and they are not going to stop now. I have been cynical, but the truth is that no one is really saying that people should not be allowed to trade; it is that the owners are not making any money for the content that leaves their world. Whose fault is that? Derailing peer-to-peer is not likely. I would say that you have a better chance of derailing that same train with a stick of MacGyver gum.

~ Stay tuned for Part 2

About Playa Solutions
Playa Solutions (http://www.playasolutions.com), represents a company that fuses seasoned management with a business model that has been created to minimize risk and maximize revenue potential for various types of online properties. In addition to providing direct and professional services, the Company's end-to-end solutions increase web traffic, protect content and generate additional revenue streams. Acting as a conduit between properties and concepts, technology and the adult and mainstream verticals, Playa serves as an infomediary that is firmly rooted in the belief that creating and serving the end user is paramount to success and begins by augmenting existing technologies and marketing efforts.


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