- Here’s a business model with a future: sue your customers. That’s what, as of this month, the recorded-music industry has been doing. It filed suit against four college students involved in Internet file-sharing (in which compressed “files” of music are swapped, Napster-style), asking for billions of dollars in damages. Yes, billions. Interestingly enough, the Bush administration, known to be opposed to frivolous lawsuits and in favor of tort reform, has weighed in on the side of the industry. Let’s go after those students. That’s where the money is.
This strategy would suggest that lawsuits against computer makers and the manufacturers of modems (and, for that matter, the little cables that connect your computer to the phone line) are in the offing. A calmer voice from the back row of a Business 101 course might well offer this suggestion to the industry: stop seeking as your customers the people most likely to steal from you.
….As events have proved, there is one crucial problem with this demographic cohort: it has much more time than money. And, if these music lovers are enrolled at a university, they probably also have access to a superfast Internet connection, which makes the usually cumbersome process of downloading music files as easy as checking your e-mail.
Many people over the age of 25 have been moaning for years, correctly, that nobody is putting out records for them. These people have families, church and community meetings to attend, golf to play and cooking to do. They have careers and disposable incomes. All this makes them far more likely to opt for the convenience of stopping by the record store than trying to figure out how to work Kazaa or Gnutella or any of the other strangely named avenues of Internet commerce avoidance.
….Arif Mardin, the producer of the hit CD by Norah Jones, said of these customers the night the disc won three Grammys, “They don’t know how to download, so they go to the store and buy the record.”
Sure enough, the next week, the CD was No. 1, selling half a million copies, and registering the biggest post-Grammy spike in recorded-music history. [NY Times]
Genius: market to people who have the money, like the convenience of a physical product with actual information included in the package, and don’t want to sit around waiting for spyware-laden software to download spoofed songs. Like me.