October 19th, 2008, 4 Comments »
Anyone paying attention to the web over the past five years ago is aware of the rise of crowd-sourcing and all its permutations. Whether it’s the amateur editors at Wikipedia or zillions of reviews on Amazon, it’s become commonplace to rely upon the wisdom of crowds.
I do this all the time. Before going to the cinema, I consult aggregated reviews at Metacritic and Rotten Tomatoes. When booking holidays, we’ll check hotel reviews on Travelocity or Expedia. And when I want to dip my toes into what the web’s talking about, I visit popurls or Techmeme or twitt(url)y.
We Need a Lot of Stuff
As regular readers know, we’re building a house. And, as you might expect, that house is going to need a lot of stuff: fridge, stove, dishwasher, TV, stereo, washer/dryer, etc. No matter how you slice it, the cost of this stuff adds up.
So how to choose the right stove or television? We’re pretty ignorant on this front, and I don’t fancy visiting a ton of showrooms. We could rely on the wisdom of crowds, but in this case, that seems a bit insufficient. Instead, we’ve bought a subscription to Consumer Reports. My family has relied on this publication on and off for as long as I can remember. I can picture the photocopied and highlighted pages, complete with dense little graphs, that would kick around my father’s desk.
It’s $25 a year for a subscription to the Consumer Reports website, but really it’s $25 for piece of mind. I’ll still google for opinions of the stove or TV we choose, but I’ll do so with the experts’ opinions in my back pocket.
I guess, at the end of the day, I can’t place all of my trust in the crowd.
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August 14th, 2008, 5 Comments »
The Internet, as you know, changed everything. Well, not everything, but it sure disrupted the way we make and distribute art. Ever since I saw geeks posting encoded files to Usenet, I’ve been curious to watch how the web has turned content creation (an awful, generic term) on its head.
One truth of the web in 2008 is that it is a much flatter playing field for creators. If you made an independent film in 1993, and you didn’t get backing from a studio, you couldn’t imagine how, say, 100,000 people would ever see it. YouTube makes that quite achievable in 2008.
But that flatter playing field isn’t necessarily accompanied by a lot of money-wielding players. And an artist has gotta eat. YouTube and other video sites have revenue sharing programs, but I doubt even 100,000 views would generate much money. I did a few quick searches on this, but couldn’t find any sample numbers.
Email Lists and True Fans
In a lot of cases, the old economic models are shot, or in sharp decline, and we haven’t figured out new ones yet. A recent guest columnist–a musician–on the Telegraph’s blog shed some light on how his band has survived in a post-Napster world:
When we left EMI in 1995, our most recent album had sold over 300,000 units. While we were still contracted for more, EMI decided to drop us. We were no longer commercial.
Today, after the internet boom, that level of sales would get us a deal with any of the major labels. After three more badly-marketed albums with an independent label we were down to 100,000 units.
In 1999 we released our final contracted album for Castle Records and, in anticipation of the way we planned to do business in the future, called it Marillion.com. We had already collected the email addresses of more than 20,000 fans through free CDs, downloads, etc. and by asking these fans to order and pay for the upcoming CD in advance, we were able to finance the writing and recording.
The precious email list reminded me of Kevin Kelly’s excellent essay 1000 True Fans.
Indie Games Come of Age?
The video game industry has, by comparison, remained unhindered by piracy. I’m not sure why this is. I assume that the industry’s explosive growth over the last decade has more than compensated for the revenue lost to pirated games. Plus, of course, I suspect that relatively few console players have the skills or inclination to play pirated games.
In any case, I’ve seen the video game industry as kind of like Hollywood’s studio system. There are a few big publishers, and they buy development studios or license their content. Even a ’small’ development studio would, I think, have dozens of employees.
The revolution in casual gaming, however, enables smaller teams and individuals to earn more attention. There’s a ton of free casual game sites on the web now. I don’t know how much revenue a given game creator sees from advertising, but I do know that their games are constantly copied and posted on new sites with advertising wrapped around them.
Still, I recently read about a success in the relatively new world of casual gaming on the consoles. Jonathan Blow developed a reportedly excellent game called Braid. He released it on XBox Live Arcade, an in-game system where players buy and download (I gather) generally cheap games. Braid had no in-store distribution–you can only get it through your XBox 360. It cost $15 to download the game. Via Silicon Alley Insider, I read Blow’s blog post about his first week of sales:
As I write this, there are 62,242 entries on the main leaderboards. I don’t have official sales numbers for the full week, but I would guess about 55,000 people have bought the game so far.
That works out to $825,000 in the first week. Microsoft takes a cut–possibly 33%–but that’s still terrific revenue for an independent game developer. Wikipedia provides a little information about the development process, but I’m unsure of what the budget for such a game would be, and how many people contributed to it. It’s enough, apparently, so that Blog can build another game without a day job.
I’m not sure, but I guess XBox Live Arcade and its competitors casual gaming portals can (have?) become the iTunes and YouTubes of the gaming industry, enabling the little guys to get greater distribution and, hopefully, revenue. Will indie game developers be as, on average, penniless as documentary film makers, despite their new-found distribution? Or will Johnathan Blow’s experience be repeated a thousand times over?
Clearly there are more questions than answers about the new economics of content. I mostly wrote this post to point to these two developments, and two industries at, seemingly, different stages of their evolution. For anybody interested in the background or context of these shifting tides, check out John Perry Barlow’s The Economy of Ideas and The Next Economy of Ideas.
UPDATE: Speaking of casual games, Andy points to a clever game called Coign of Vantage.
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July 15th, 2008, 12 Comments »
At some point in my adult life, I learned this rule of thumb:
The monthly cost of housing (that is, rent or mortgage) should comprise less than 30% of your income.
It’s a kind of personal finance benchmark: if you’re spending too much on housing, you’re probably not living an economically-sustainable lifestyle. For example, I recently read that, on average, Montrealers “spent 18.6 per cent of its income on housing and shelter costs in 2006″. On an unrelated note, the median cost of housing in the Montreal area seems shockingly low at $683 a month.
However, I’ve never been clear as to whether they meant 30% of your gross or your net income. I decided to finally figure it out, and write up the answer.
First off, various sources indicate that the correct metric is 30% of your ‘household’ (or sometimes ‘family’) income. So what’s ‘household income’? According to Wikipedia:
Household income is a measure of current private income commonly used by the United States government and private institutions. To measure the income of a household, the pre-tax money receipts of all residents over the age of 15 over a single year are combined. Most of these receipts are in the form of wages and salaries (before withholding and other taxes), but many other forms of income, such as unemployment insurance, disability, child support, etc., are included as well.
So the key phrase there is ‘pre-tax money’. Apparently, then, the rule of thumb applies to your gross income. Does that jibe with what you thought?
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March 5th, 2008, 8 Comments »
Kevin Kelly is a great thinker, and his latest piece about surviving as a creative person is no exception. He says that every artist needs to find and foster 1000 True Fans:
A True Fan is defined as someone who will purchase anything and everything you produce. They will drive 200 miles to see you sing. They will buy the super deluxe re-issued hi-res box set of your stuff even though they have the low-res version. They have a Google Alert set for your name. They bookmark the eBay page where your out-of-print editions show up. They come to your openings. They have you sign their copies. They buy the t-shirt, and the mug, and the hat. They can’t wait till you issue your next work. They are true fans…
Assume conservatively that your True Fans will each spend one day’s wages per year in support of what you do. That “one-day-wage” is an average, because of course your truest fans will spend a lot more than that. Let’s peg that per diem each True Fan spends at $100 per year. If you have 1,000 fans that sums up to $100,000 per year, which minus some modest expenses, is a living for most folks.
This is a great, evolved perspective on the Long Tail. It offers a tactile plan that any artist ought to be able to get their head around. The post also reminded me of two terrific articles by John Perry Barlow, published in Wired while Kelly was editor (I think): The Economy of Ideas and the Next Economy of Ideas.
I also like one of Kelly’s caveats:
Not every artist is cut out, or willing, to be a nurturer of fans. Many musicians just want to play music, or photographers just want to shoot, or painters paint, and they temperamentally don’t want to deal with fans, especially True Fans. For these creatives, they need a mediator, a manager, a handler, an agent, a galleryist — someone to manage their fans. Nonetheless, they can still aim for the same middle destination of 1,000 True Fans. They are just working in a duet.
That’s easier said than done, as there are far more artists than there are willing agents and mediators. I’ve seen many an artistic endeavour fail because the creative folks weren’t willing or didn’t know how to promote their project. The most successful artists I know are not necessarily the most talented, but they’re definitely smart, dogged marketers of their own work.
Reading the article, I wondered if I was a True Fan of anybody. I think I’ve read all of Nicholson Baker’s books. I’ve bought all of the Cowboy Junkies’ albums, and seen them four or five times. I can’t think of anybody else. One good indicator of whether you’re a true fan of an artist is if you have them on your Wikipedia watch list.
Who are you a True Fan of?
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January 23rd, 2008, No Comments »
At the moment, CAN $1 = MAD 7.53. In my experience, very few things are less than one dirham (about 12 Canadian cents). In coins, I’ve seen a half-dirham (it literally has a 1/2 symbol on it), one dirham, five dirham and ten dirham denominations. In bills, there’s a 20, 50, 100, 200 and so forth.
Practically speaking, there are no cents or centimes or santimat. Unlike most other countries I’ve visited, there are no ones and hundreds–it’s just hundreds. On the other hand, you’re not working in absurdly large quantities, as in, say, Zimbabwe or Italy before the Euro. The worst conversion experience I’ve had is Hungary, where one Canadian dollar equaled 175 forints. Try making that calculation on the fly.
Transactions are easy in Morocco. It’s just one number, and it’s almost always below 500. This is a real boon to my incredibly crap French, handy when you have to negotiate the price of many purchases over, say, 10 bucks Canadian.
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