We’re entering a recession, budgets are being slashed, people laid off and there is little positive sentiment to be found. Exactly the scenario in which the savvy content owner should prove they are ahead of the curve… and start giving away their content.
Not an easy sell at the best of times, but several influential voices are advocating just that.
Chris Anderson got content-owners’ juices flowing when he spoke about the Long Tail (and coined the most over-used phrase since Malcolm Gladwell introduced the ‘Tipping Point’ into business parlance a few years earlier). Now he is one of the commentators talking up the ‘free’ model.
In fairness, it could be argued that the TV industry has already pioneered this business model. After all, commercial broadcasters ‘give’ the consumer entertainment in return for the ability to sell advertisers eyeballs. In kids TV it’s not uncommon for producers to give broadcasters content in order that the show in question gets a good slot and they generate revenue from licensing and merchandising.
But in the digital realm could giving content away help owners of intellectual property build a business and lose less money to piracy?
"It’s now clear that practically everything Web technology touches starts down the path to gratis, at least as far as we consumers are concerned," Chris Anderson says in his Wired Magazine article: ‘Free! Why $0.00 Is the Future of Business’.
The ‘Freemium’ model is often used by software vendors and, according to some, could work with premium content. It involves offering free, possibly degraded or advertising driven, samples of product in the hope that, with an accompanying impulse purchasing system built in, the user will upgrade. US research group Yankee asked content owners about applying this model to their businesses and found that the rights owners’ expectation was for 5%-to-10% of free users to migrate to a pay model.
But, how could this relate specifically to TV producers and distributors? For instance, could Warner Bros. give away low quality downloads of hit teen drama Gossip Girl with adverts, while also offering high quality, high definition versions for a small charge?
What is clear is that it has to be free, initially at least. As soon as any cost is attached the model changes. Free, done well, means viral marketing and word-of-mouth and the challenge then is to generate revenues around this. Could it work for content-owning producers and distributors? More and more people think so.