Fighting over something that nobody knows what it is

Interesting and insightful piece on the challenges faced by the Writers Guild of America and the Hollywood studios:

“Part of the problem is that they’re fighting over something that nobody knows what it is,” chief research officer for CBS David Poltrack said.

The future shape of the TV industry is so uncertain, according to Poltrack, that almost any formula established today will almost certainly quickly become obsolete.

One reason the digital-rights management wars have been so endless and so intractable, for instance, is that content owners still cling to the notion that every copy, every use of their content implicates their exclusive rights and should be monetize, or at least specifically accounted for within a licensing scheme.

In a networked environment like the Internet, however, use-based or copy-based models have not been notably successful for monetizing content. Mostly what they do is imposed significant technical, legal and financial overhead needed to track, control or otherwise account for each copy.

The problem for both the producers and writers, however, is that in a networked environment, value really changes hands at the point of access to the network, not from the exchange of copies on the network.

As the Supreme Court correctly diagnosed in the Grokster case, the monetizable exchange was occurring at the point of entry to the network: the more eyeballs that came to Grokster, the more it could charge for advertising.

The real problem for the content owners was not that someone was infringing their exclusive rights but that Grokster was not sharing the value it derived from that monetized exchange fairly with the other stakeholders in the network. It was an economic problem more than a legal one.

Shutting Grokster down, however, doesn’t really address the basic problem. For content owners to thrive in a networked environment they’re some day going to have to figure out how to get a piece of the action at the point of entry to the network, where the real value is.

But so, too, will anyone with a stake in the revenue generated by that content.

That means the vaunted but still elusive “new business model,” everyone is always urging on content owners is also essential for the writers and other stake holders.

From Content Agenda.

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