I have been meaning to write about the NY Times piece on royalties in the age of streaming music. People have talked about how real dollars have turned into digital nickels when music went online and sales went from records to individual songs. With streaming, the argument goes, “the river of nickels looks more like a torrent of micropennies.” The first big gaping whole in the article was that it made no attempt at unpacking what part of the economics goes to labels versus individual artists....

I had an opportunity to buy shares in the Pandora IPO but chose not to. If I was a super active trader and had stayed on top of it I could have made a fair bit of money as the stock popped by about 60% in early trading but closed even the first day up only about 10% from its IPO price. Yesterday, only a couple of days later, Pandora is trading below its IPO price. Today the price is down a bit more. Why did I not jump on Pandora? There are two key reasons. First, I spent a bunch of time readi...

I have been reading and thoroughly enjoying “Reality is Broken” by Jane McGonigal (love the name too!). One basic premise of book is that games are engaging exactly because they represent a “better” version of reality in which missions are clear, feedback is more direct, failing is fun (careening off the track), … At the same time, I have started to learn how to play piano from a fake book. A fake book only shows the right hand melody and then indicates the chords that should go along with it...

This is another post in thinking out loud about the economics of abundant and digital goods. In particular, I am interested in mechanisms that allow producers to recapture some of the consumer surplus even when the price for (a version of) the good is zero. In photography, there is a well established difference between limited edition prints (sometimes a single one) made by the artist and reproductions of the photograph in catalogs or online. I believe it is possible to create a similar mecha...

In Monday’s post on the Economics of Abundance, I gave “name your price” as an example for how to deal with zero marginal cost. This is a case of voluntary price discrimination, i.e. folks who value something more are more likely to name a higher price. The first question of course is if such a scheme can work at all, that is will anyone pay if paying is entirely voluntary. We know the answer for this to be yes from the Radiohead experiment with about 40% of folks paying (according to Comscor...

Personal media management and consumption are a mess. For instance, I use Picasa for photos and short video clips coming off my camera onto my laptop. But given the large number of photos and video, I then move everything to an EasyNAS RAID array. Pictures from my mobile phone go to flickr. For music and video downloads I use iTunes on my laptop, but in my living room I have a Sonos. My PVR is from the cable company and (big surprise) doesn’t talk to anything else. My DVDs are largely not rip...