Busy this morning "consulting" on a film (Hi Liz!) and finally got around to cleaning out the InBox when I found a nice little email from the folks at Content Agenda featuring two stories that speak not only to the past media business model, but to the future.
The first is an op-ed from Julian Lloyd Webber regarding the Price We Pay for Free Music. In it he discusses the fact that musicians will be putting more and more content up on the web for free and how this will hurt musicians overall - especially those without "name value."
I am certain Mr. Lloyd-Webber is a fine musician, however he knows little to nothing of the economics of the web. To be fair, not many people do know the economics of the web. That said, we all have to realize that programming on the web or television is designed to sell products through advertising. You aren't selling the programming itself, but that is the hook to get people to look at the ads and buy the merchandise.
That's the way it's always been, and people don't blink an eye at the idea of free television, yet somehow they blanch at the idea of giving things away for free on the web. People only pay for cable because it doesn't have advertising to pay for it (I'm talking HBO, etc... here), and in that case, waaaaay fewer people watch HBO programs than they do terrestrial broadcast programs.
Now understand that there is a huge fertile field of the internet out there to plant advertising. Doing an entertainment-to-ad spending comparison, there's a lot of room to grow the web.
A lot. Estimates are that right now only 14% of the web's potential is being used ad spending-wise. Already it's a multi-billion dollar business and it still has 86% more room to grow.
In light of that dollar potential for ads, is it so wrong to give music away for free?
The second article that caught my eye was the announcement by Damon Wayans that he is starting a web business called WayOutTv.com to, "feature videos produced by aspiring young comedians he handpicked. Wayans sees the free site as an online comedy club and production studio that could eventually change the way content is bought and sold in Hollywood."
Mr. Lloyd-Webber would do well to pay attention to Mr. Wayans. He is starting the online equivalent of In Living Color - the television series which brought us comedians David Alan Grier, Jim Carrey and others (including Jennifer Lopez. What? She's not a comedienne? Really?)... And like television and radio before him, he's doing it for free.
Gee, it's even happening in comics...
Are the economics that hard to understand?