The Joke’s On iTunes

Posted on Dec 14, 2011 | 4 Comments

Being funny requires fresh thinking, which might explain why business innovation and comedy have always been closely intertwined.

In the 1920s, Charlie Chaplin pioneered self-production in movies. In the 1950s Desi Arnaz led the way to the modern sitcom format. Today, according to CNET News, comedian Louis C.K. has found a new way to get his work into people’s hands: producing and selling an online video of his show with no copyright restrictions.

He sums it up as follows: “I have a profit around $200,000 (after taxes $75.58). This is less than I would have been paid by a large company to simply perform the show and let them sell it to you, but they would have charged you about $20 for the video. They would have given you an encrypted and regionally restricted video of limited value, and they would have owned your private information for their own use. They would have withheld international availability indefinitely. This way, you only paid $5, you can use the video any way you want, and you can watch it in Dublin, whatever the city is in Belgium, or Dubai. I got paid nice, and I still own the video (as do you).”

Peter Drucker, we think, would have been pleased by such creativity. Indeed, he anticipated it. “In a time of rapid change distributors and distribution channels tend to change faster than anything else,” he wrote in Management Challenges for the 21st Century. “And it is also on the distributors and distribution channels that the ‘Information Revolution’ is likely to have the greatest impact.”

Louis CK

When Drucker was writing, it was “traditional distribution channels”—namely, brick-and-mortar stores—that were being threatened by e-commerce upstarts such as Amazon. Now, it’s Louis C.K. who stands to grab business “rather than sharing it with services from Apple, Google, Netflix or other corporate powers,” CNET noted. 

This may cut against conventional wisdom, but that’s exactly what makes it so potentially powerful. “A serious cause of business failure is the common assumption that conditions—taxes, social legislation, market preferences, distribution channels, intellectual property rights and many others—must be what we think they are or at least what we think they should be,” Drucker noted in Managing in a Time of Great Change.

What’s your sense: Is the selling-with-no-copyright-restrictions experiment by Louis C.K. an interesting novelty or the start of a big new trend? 

4 Comments

  1. Manuel Wittke
    December 15, 2011

    New Technology and new distribution channels (i.e. the Internet) allow everyone with access to distribute creative content to everyone else with access. The Internet is the infrastructure. The established distribution companies operate the POSs at where the consumers acquire the content.
    But what is a content distributor in nowadays? Is it a company that buys content and resells it? Is a webspace provider that enables a small producer to publish her creative content on a self-administrated website not a distributor just because it receives no commission for the sold content?
    Peter Drucker described innovation as a result of creating new customers.
    When the customer’s (maybe currently not known) need is not only to acquire but to get notice of content then the distributors AND the infrastructure providers also have the role of content aggregator.
    In my opinion platforms like youtube are successful because they provide the one who is looking for content a comfortable way to find it.
    When the mission is to aggregate and provide content and the customer would be the consumer AND the provider, the question still would be how to turn the work into benefit.
    At distribution platforms (e.g. itunes, netflix, amazon) it is easy to acquire content therefore the customer is likely to pay more for the content. Providing easy access to content is the mission of those companies. Restrictions actually oppose the mission. With the intention to bind the customer to the own platform the distribution company hinders the user in consuming the content freely. Apple, Google and other understood that to compensate that restriction they have to offer an immense amount of content and the consumer needs an easy-to-use consumption environment (i.e. devices and websites). As long as those two criteria are met the mission will be accomplished.
    Selling-with-no-copyright-restrictions will enable the user to consume content anywhere, anytime. And the content provider / producer has to put much more effort into publishing her content. Easy-to-consume seems to be contrary to easy-to-find.
    Thus I think we will see an interesting novelty rather than a start of a big new trend.

    Reply
  2. John Goddard
    December 19, 2011

    I like a good joke but giving away copyright on what you produce is a decision any creative person needs to consider carefully.

    Things that are considered “free” often have little value to the consumer or business customer. Sure internet distribution is the way to go to eliminate costs and barriers to obtaining a product, but any provider must ensure that their product adds value to a customers business.

    For reference check Peter Druckers book on the five most important questions any organisation should ask itself to discover where the value is in your product or service.
    John

    Reply
  3. The Feedback | The Drucker Exchange
    December 20, 2011

    [...] the topic of whether comedian Louis C.K. was being wise or foolish to sell his standup DVD free of copyright restrictions, reader John Goddard had this to say: I [...]

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  4. This Post, Too, Is Self-Published | The Drucker Exchange | Daily Blog by The Drucker Institute
    April 17, 2013

    [...] electronic distribution would to some extent alter our habits of print consumption (and much else, as we explored here). “The new distribution channel will surely change the printed book,” Drucker asserted [...]

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