Seth Gilbert, 10-25-2007
Usually market experiments run for a few months; enough time to draw data to evaluate. Penguin Audio books decided not to wait. Just the opposite, they pulled the ripcord on an audio book market experiment with eMusic after just a month’s time.
eMusic is the number two seller of digital music behind iTunes. They made their market by selling unencrypted DRM-Free music. Last month, they expanded into audio books following the same recipe: selling books without digital copyright encryption. Penguin was one of five founding participants in eMusic’s digital books initiative. They offered 150 titles that they were simultaneously selling with copyright protections on iTunes.
Earlier this week Penguin decided to go DRM or bust. They’ll stick with iTunes but are dropping eMusic.
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Seth Gilbert, 10-24-2007
A key precursor to advertising dollars is the ability to effectively measure audience response and behavior. It starts with the basics: how many people are watching. Then it gets to the who and where. Eventually, if there’s enough data to determine it, it becomes more and more targeted, more and more specific. The more you know about the audience, the better you can serve advertising to their interests. And the more you can target the advertising, the higher you can charge for it.
This kind of information based advertising has been the formula for Internet billions. It’s at the core of Google’s success. And now Google is hoping to expand that formula to television. Doing so, however, will require partners and new techniques.
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Seth Gilbert, 10-23-2007
There are surprises and then there are Surprises with a capital S. Apple trouncing earnings estimates this week fits in the first category. The results were stellar but hardly a shock; more of “wink wink” we did it again. Netflix handedly beating earnings estimates Monday was blind-siding surprise that was hard to see coming.
When Netflix reported late Monday, the expectation was much as it has been for recent quarters: competition from Blockbuster would be a drag on margins, price cuts would weigh on revenues and customer growth should fall into the moderate but not terribly impressive category. Click to Read More
Seth Gilbert,
It’s game time for MySpace. Already solidly established as a music and video destination for their users, the social networking giant announced Tuesday they will add casual games to the mix.
Through a deal with New York based game maker and publisher Oberon, MySpace will launch a game destination on their site in January. The section will be host to as many as hundreds of easy to play, easy to learn games. Puzzles and word games, variations on standbys like chess and checkers, should figure prominently. The idea is similar to Yahoo Games, Pogo and other sites, but will also include social networking functionality.
Casual games aren’t usually big money earners. They account for a small fraction of overall gaming industry income but the games are increasingly popular with web hosts as ways to keep their audiences entertained with quick burst of activity. Click to Read More
Seth Gilbert,
A week ahead of launching a beta for Hulu , their Internet video joint venture with News Corp (Fox), NBC is circling the wagons and gathering up their content.
In a move reportedly confirmed by an NBC spokesperson, the company has pulled all its video clips from YouTube. Notice for the takedown was sent Friday.
The move is intended to maximize Hulu’s exclusivity and give it the best chance for drawing audience. Having the same content available elsewhere would have undermined the launch.
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Seth Gilbert, 10-22-2007
When Apple issued earnings guidance at the end of the third quarter they attempted to reset analyst (and investor) expectations. An ambiguous new product launch (which turned out to be both new macs and the new iPod line) would decrease margins and profits, they cautioned. They advised a conservative view. They forecast meager revenue of $5.7 billion and earnings of only 65 cents a share. That seemed way too low. Call it conservative finance, call it sandbagging, or overly cautious analysis, call it what you want, but whatever the name – there seemed little reason for it. Now there’s proof. was , in fact, no reason for caution at all.
After the close of markets Monday, Apple announced their results for the 4th quarter. For football fans, the numbers were like yesterday’s first half score between the Patriots and the Dolphins: a blowout. For Q4 Apple reported the highest September earnings in their history.
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Seth Gilbert,
Apple’s called it confusing to customers. Other retailers have reportedly looked at it but balked. But variable pricing remains a feature music labels want. They want to bundle songs and albums, price relative to changing demand. They want to discount an old title, push a new one. They want the freedom to use pricing as a sales tool. They’ve demanded it, and maneuvered for it. They’ve threatened. They’ve nearly begged for it. But so far, fixed pricing on digital music remains the norm.
Tennessee based Passalong Networks, a provider of white label MP3 stores, is going to give it a try. White Label to the label’s white knight? That’s not likely, but it won’t keep them from testing the concept.
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