First Monday, Special Issue #6: Commercial applications of the Internet

Reflections on: A taxonomy of Internet commerce
First Monday

Reflections on: A taxonomy of Internet commerce by Paul Bambury



This paper is included in the First Monday Special Issue #6: Commercial applications of the Internet, published in July 2006. Special Issue editor Mark A. Fox asked authors to submit additional comments regarding their articles.

Read the original article here http://www.firstmonday.org/issues/issue3_10/bambury/index.html


Reviewing this text, nearly eight years after writing it, has been a nostalgic experience. 1998 was an exciting time for those interested in the Internet. The potential seemed immense. Something new was happening. Maybe society would be transformed by the public network.

Since then, there's been the dotcom crash and the subsequent establishment of the net as part of the plumbing of post-modern society. An important part of this has been the pervasive commercialization of the network. It's still a public network but it is now a commercial, public network. Notwithstanding this, there are still significant non-commercial territories flourishing and the net continues to aggregate vast and disparate communities.

When writing A Taxonomy of Internet Commerce, I was interested in whether a new type of business was emerging on the net and if a new type of economics could describe it. This was partly related to notions about information and freedom. Information was free and abundant on the net. This seemed contrary to economic principles around the relationship between value and scarcity. Since then, there has been abundant work done by many thinkers on these issues.

In respect to the role of abundance and scarcity on the net, Umair Haque and the Bubblegeneration crew (see http://www.bubblegeneration.com) have identified that attention is scarce on the net and that this is an intrinsic feature of net markets. Attention scarcity appears to be an emergent property of vast, distributed networks, the scale of which exceeds the attention span and capacity of any individual, by several orders of magnitude.

My experience in attempting to market music on the net suggests that attention scarcity is an important factor and a difficult problem to address. My music company, Qualia Recordings, has music available for download (for free and pay) on the QualiaRecordings website, on forty-eight other commercial sites through the CDBaby Digital Distribution Program, and available for play on last.fm. Of course, many other artists and independent record companies are also taking advantage of this emerging commercial infrastructure. In this market it can be difficult to attract sufficient attention to sustain the business model.

Many bands and artists take advantage of the net by using it to advertise their performances, at which they sell their CDs. This can be very effective and the major record companies are becoming less relevant to artists. However, despite the apparent success of aggregators like iTunes, few independent artists appear to be profiting from commercial downloads and a business model based solely on pay-for-downloads is very difficult to implement successfully.

These reflections are related to another important development in network economics, Chris Anderson's theory of the Long Tail (see http://www.thelongtail.com). This is a very interesting and attractive notion, which was hinted at by Michael Robertson in his Middle Class Musicians article on mp3.com. What this potentially means for independent artists is that they can pursue their musical careers on an amateur basis through net enabled distribution and promotion, while keeping their day jobs and still hope to make enough profit from their musical activities to make them sustainable. Amateur and independent artists can theoretically rely on the long tail to provide them with a modest audience and income.

It is probably too early in the development of net markets to fully understand the usefulness of long tail theory to small content businesses like independent music producers, but the emergence of large scale aggregators, such as iTunes seems to provide the necessary infrastructure for long tail independent music markets, if artists and producers can solve the attention scarcity problem. End of article

 

About the author

Paul Bambury is an independent music producer and director of Qualia Recordings. He and his collaborators produce music as Alien Headspace, FutureRetro and the Trancendental Anarchists. This music is available from qualiarecordings.com, cdbaby.com/cd/futureretro, http://cdbaby.com/cd/alienheadspace, iTunes and http://www.last.fm/label/Qualia%20/

For a day job Paul works for the Australian Government.
E-mail: taqpah@iinet.net.au

 


 


Contents Index

Copyright ©2006, First Monday.

Copyright ©2006, Paul Bambury.

Reflections on: A taxonomy of Internet commerce by Paul Bambury
First Monday, Special Issue #6: Commercial applications of the Internet (July 2006),
URL: http://firstmonday.org/issues/special11_7/bambury/index.html