Today the UK telecoms regulator Ofcom released its anticipated Code of Practice for ISPs to help combat digital piracy (following hot on the heels of the tough Irish anti-piracy strategy). The Code forms part of the provisions of the Digital Economy Act and is a series of best practices for ISPs to follow rather than a new set of regulations. The intention is that copyright infringement will be seriously dented without need for more formal state intervention (such as the reserve powers of the Secretary of State to cut off repeat offenders’ broadband connections). I will be amazed if any statistically significant decrease in copyright infringement happens because of this Code being followed. Simply advising ISPs when and how to notify subscribers who are infringing copyright is not enough.
But I’m not saying that draconian state intervention is inherently necessary. Indeed, the preferred option is for legislation to establish clear limits and consequences but for consumers to be lured away from the illegal sector by compelling cheap and free alternatives. If ISPs and mobile operators are empowered with truly engaging services that give on-demand access to content on the terms consumers want and with most or all of the cost hidden, then file sharing will meet its match.
File sharing (on network and off network) exists because it fills a needs vacuum. A vacuum which neither iTunes nor Spotify sufficiently fill on their own. Subsidized, unlimited MP3 subscriptions would nip file sharing in the bud. Why would a teenager use BitTorrent when they can get the same music at higher quality and with clean meta data and that they can use however they like, all as part of their parents’ ISP bill?
Forget the Football World Cup; summer 2010 is shaping up to be one of the most exciting periods in digital music’s short history. Spotify is preparing to launch in the US (still), Nokia is rolling out multiple new Comes With Music territories, MOG is finding its feet as a premium subscription service and a number of exciting new services are primed for launch. But just as with the World Cup we’ve already got a decent idea of who the finalists are likely to be: Apple and Google. Continuing the World Cup analogy a little, Apple is Argentina, the once great force that have lost their way a little but have arguably the best array of talent and look like they may just be about to have the engine purring like a tiger again. Whereas Google takes the role of Holland: a slick, skillful team who take all before them with their total football but have never won the World Cup. (Football aficionados will have noticed I left out Spain - the 3rd and possibly strongest favourite - but they didn’t quite fit my framework!)
Closed versus open is actually closed versus…er…closed. Google is playing the role of disruptive new entrant and mischievously played upon Apple’s original 1984 marketing, positioning Apple as being the Big Brother now. Google has also played strongly on being open versus Apple’s closed approach. But the bottom line is that Google’s music strategy looks likely to be pretty closed too. The fact that the Android Music Store is designed to work with Android devices means it will be similarly exclusive as the iTunes / iPhone / iPod / iPad ecosystems. The difference is Google is betting on a wide range of partners having a large installed base of customers on its platform so it will ‘feel’ open.
Eircom, the Irish incumbent telco, has introduced a ‘four strikes and you're out’ anti-piracy policy, making Ireland the first European country to take such measures, beating even France to the punch. Under the provisions of the policy, the Irish Recorded Music Association (Irma) will supply Eircom with IP addresses of thousands of infringers from which the ISP will select just 50 a week and match them against postal addresses. These 50 will then receive notification letters, a phone call, and potentially a browser pop-up. If they are identified a 3rd time, they will have their connection temporarily cut off, and if they are caught a 4th time, they will lose access for an entire year.
I’ve just come back from a day at the UK music event the ‘Great Escape’. Though it was a bit of a flying visit, I had the opportunity to listen to a Q&A with Universal Music Group International’s VP of Digital, Francis Keeling, and to co-judge a panel of new British digital music startups. Here are my highlights.
Universal Music understands the value of product innovation.
Click the embedded video below to view our latest Consumer Product Strategy Podcast episode. This is episode two in our 'Find Your Popcorn' series in which analyst Nick Thomas looks at new ways to build revenue around content in the digital age.
This podcast series is part of the buildup to a major research report on the same topic, and we'd love your feedback and thoughts as we develop the thinking. So please feel free to make any comments and suggestions as we progress. Enjoy the podcast!
Here is the second video podcast in the "Find Your Popcorn" series, part of a new approach to our research processes. So to hear me talk about how gaming sites' promotion of virtual goods (paid for with real currency) could help other companies build new revenue streams, please click on the video link below. And as ever, please share your thoughts and feedback on both what we are saying and how we are saying it.
And watch this space for updates on how to subscribe to future podcasts via iTunes.
I enjoyed listening to Carol Bartz, the CEO of Yahoo!, who was in London last week to address the European press and analysts. She’s smart, focused and entertaining – a rarer combination than it should be. But one thing in particular struck me. When she was asked about the future of online advertising, she commented that in the future, “ads should be as interesting as the content.”
A truism? Perhaps, but one that still eludes many advertisers off- or online. And while my usual focus is on the content side of media, let me extend my brief a little to comment on some current ad campaigns, bearing in mind Bartz’s words. Excuse the non-scientific survey, but three campaigns I’ve watched in the past week have stuck in my mind.
John Lewis’ lengthy TV ad has been extensively written about - with several commenters noting its uncanny ability to make them cry. It’s all about brand positioning, but it’s a beautifully crafted bit of content that bears repeated viewing. In my household (like many others in the blogosphere) this is a rare example of a TV ad that viewers actually hope will be shown. In essence it’s not revolutionary, but it’s hugely effective (and affecting). Check it out here.
I saw it on TV last week when in a cruel twist it was shown before the corresponding new campaign from Marks and Spencer, its erstwhile competitor as the UK shopper’s best-loved retailer. But what a terrible ad (no link - unsurprisingly it has not been uploaded to YouTube). Uninspiring, unaspirational, humdrum and failing to convey anything great about the M&S brand. Its message? Something about shopping at M&S if you can’t be bothered to cook. That’s what I recall, anyway. Not the finest call to action I’ve ever come across.
Regular readers of the Consumer Product Strategy blog will know that we put a lot of store in the value of product innovation for media companies in the digital age. We’re taking this theme further with our latest initiative, the Forrester CPS podcast ‘Find Your Popcorn’, and in turn experimenting with some of our own research product innovation.
Over the coming month, CPS media analyst Nick Thomas will be recording podcast episodes and posting on the ‘Find Your Popcorn’ theme. This research theme investigates new ways to generate revenue from content in the digital age and the kinds of new product models that can and should be developed. It is essential information for product strategists at media companies and technology companies alike.
Throughout the ‘Find Your Popcorn’ series, our intention is to expose the report writing process to the external marketplace and to give you, the audience, the opportunity to participate in the discussion and debate. So over the coming weeks, we will be experimenting with different ways of using the podcast format and we encourage you to give us feedback both on the content and the deliverable itself.
Forrester clients will additionally get an exclusive full-length video deliverable to accompany the final report.