weeks - 2:23 am on Apr 28, 2011 (gmt 0)
I don't think I've seen the economics and marketing laid out as clearly and simply as by sundaridevi here. What's interesting is to make streaming pay, it's going to have to scale. $1 downloads are only attractive if you have a LOT of downloads. What is a lot? For me, a million. For the kid next door, a hundred. For General Electric or Apple, I look like the kid next door. Yet, as they get bigger, the streamer undercut their own market as they are driving prices down to make more sales. Everyone here with a retail site knows this. The world has seen this with iTunes. And Walmart.
Today online video revenue for free streaming sites comes from in-video ads (like Hulu) or from on page ads (like AdSense or other traditional banner type ads), but that revenue is pretty small compared to what you get for VOD or paid downloads.
There are issue here for the arts and culture. Does our society require the potential of super-dupe huge fame and fortune to create the Beatles? Nothing in the past would indicate that to be necessary. Indeed, perhaps the late 20th Century was unusual in its huge cultural brands. I'm talking about Tide soap and the Rolling Stones, both. Maybe those of us building the web, especially the independent web, have been a part of all of that unwinding, slowly...
We'll still have the people talented as the Stones, but more than ever we are going to have to use our own judgment to find them.
Is Tide really a good soap?