Monday, March 08, 2010

Digital Desert


Recent reports suggest that Lady Gaga recently received from Spotify her royalty / revenue share cheque for...........$150. Her album has gone Diamond and Spotify is very widely used. A major UK sports event has been unable to justify building a website as the revenues are uncertain and a UK Federation who cannot get a TV deal for a series of live events have decided not to distribute online in the USA as the revenues are not guaranteed to cover technical costs. Airlines and shops are using the web to great effect but for pureplay IP (music, TV, movies etc) the ecosystem seems to be all about free content & piracy and therefore presents no opportunity for distribution of traditional "linear" content on a profitable basis. Services built around interactivity and which deliver an "outcome" to the user may be different but passive lean back experiences are not generally delivering revenues.


To pick up on Iolo's earlier post re; Love Film...... I love the service - no late returns and a pretty wide selection of content. If the above information is correct it suggests that from a economic perspective the consumer is happier to pay for a physical disk in the post than a download via the broadband internet.