Commentary on the Westlaw marketing campaign and other vendors who try to double-dip by selling directly to users things that they already have access to through the library's paid subscription. 

Social Networking and Individual Outcomes: Individual Decisions and Market Context illuminates a mathematical perspective to determining how one develops his social network. Focusing predominantly on a social group’s impacts on an individual ignores other features of social interaction such as the deliberate attempt to formulate networks.  Ioannides’ mathematical calculations simplify social interactions into cost/benefit analyses.  The costs include time invested, potential social devaluation, and others.  Benefits include attainment of resources, an increase in one’s network, and others.  In short, Ioannides hardens abstract social interactions into the confines of transactional interactions.

The article, while somewhat cryptic, quantifies attempts to increase one’s social network.  Such formulas are useful in identifying which components (e.g. other individuals, the environment, itself, benefits from the specified situation, etc.) are most impactful on the individual user (and, subsequently, how impactful such factors are relative to their counterparts).  Although Ioannides recognizes that individuals may be agents of their behavior (and that such behavior varies between environments), much of his literature assumes that humans behave maximally; that is, humans will only engage in behaviors that absolutely maximize their benefits while diminishing any potential costs.  Such presumption presents potential difficulty in accurately evaluating subjective human behavior on social networking platforms.

Gladwell, Malcolm. "The Tipping Point." 2000: Little Brown & Co.

Like Chris Anderson's Long Tail, Malcolm Gladwell's concept of a sociological "tipping point" is a useful term in any discussion about marketing on the internet. "The Tipping Point" is a sociological analysis of different types of key consumers: connectors, mavens, and salesmen. Gladwell uses these terms and other definitions of "tipping" and "stickiness" to explain instances of small ideas or materials becomining unexpectedly popular as they reach a "tipping point."

Though Gladwell does not remark explictly on the internet, I believe that his concepts are crucial to the way that the internet spreads information about musicians. Much of my discussion on online marketing and non-industry-regulated profitability is tempered by the understanding of internet marketing efforts as definitionally "grassroots." "The Tipping Point" is an analysis of grassroots marketing efforts, and my hope is that when Gladwell's concepts are lent to examinations of popularity and profitability of independent musicians on the internet, useful trends will be derived. For example, why would Radiohead benefit from a pay-what-you-want model, while an indpendent artist might not? And if an independent artist like Girl Talk does reach a "tipping point" via internet exposure, the ways in which they expand on these internet "grassroots" methods are major contributing factors to success. Gladwell's discussion offers some terminology to explain why.

Dubner, Stephen J. "What's the Future of the Music Industry? A Freakonomics Quorum." Freakonomics Blog, New York Times. 20 September 2007. <http://freakonomics.blogs.nytimes.com/2007/09/20/whats-the-future-of-the-music-industry-a-freakonomics-quorum/>

This 2007 New York Times blog compiles the opinions of five different experts on the music industry. They are asked to reflect on the "future" of music in the context of the digital revolution. One expert is the author of the previously-referenced "Effects of File-Sharing on Record Sales," three are major music executives, and another is the founder of Engadget and a free, online-only music label. Essentially, they all offer disparate perspectives regarding the way in whcih music consumption is changing.

In a paper meant to argue a particular position about the success of new online music distribution methods, any novice or statistical opinion must be tempered by that of the experts. This New York Times column is a unique and valuable compilation of 5 different expert opinions. Largely, everyone seems to agree that the music industry is undergoing substantial change and that the labels must be open to reinvention. One suggestion undrestood by the labels in 2007, it seems, are advertising-supported models. Most interestingly, in their opinions these experts define exactly why the internet has changed the demand for music so thoroughly: it has affected scarcity. This is a crucial basis of understanding for any marketing or revenue model that follows.

Anderson, Nate. "Free Nine Inch Nails album tops 2008 Amazon MP3 Sales Charts." Ars Technica. 6 January 2009.

This article summarizes experiemental distribution of Nine Inch Nails's new album and the effects the new online distribution model had on sales. Nine Inch Nails released the album Ghosts I-IV under a Creative Commons license, which allows legal free sharing and remixing. Despite this, the album garnered huge profits; both via digital download on Amazon.com, and perhaps more significantly in limited edition "extras" sets. The Ars Techinca article goes on to pose two questions to Fred Beneson of Creative Commons: Why would fans buy the album when it could be had for free, and would Creative Commons Lisencing work for record labels? Bereson addresses these questions speculatively, with optimism as well as some analysis of the factors necessary for the success achieved by NIN.

This is a major success story for Creative Commons, and an example of a profit-making model that still offers free download and distribution of music. The profits of Ghosts I-IV speak to the appeal for a product that is not available for free download (extras, convenience, or the authenticity of supporting an artist directly). Understanding the presence of this demand is necessary for understanding the way people want to consume music in the digital age. Profits can be achieved via different music products and services.

Accenture Media and Entertainment. "The Challenge of Change: Perspectives on the future for Content Providers." Accenture Global Content Study 2008. Accenture: 2008.

This report is the result of a market research firm initiative, in which they surveyed 100 entertainment executives to determine their opinions on the future of revenue models based on digital media. The results of the survey show that the ad-based model is the most popular model for the surveyed executives, as opposed to subscription or iTunes-like services. Though the focus in the report seems to be on forms of entertainment other than music media, it provides a successful context for profit-garnering models in digital entertainment. It also reflects the point of view of those that will ultimately be responsible for shaping the way that media is transferred to the consumer (legally) online.

This report represents yet another perspective on successful provision of internet content (without greater legislation). The importance of advertising on maintaining free content on the internet cannot be understated -- many argue that advertising-based models represent the future of music revenue. Ad-based music models are already being put into place: the music-search engine developed by Google in China, for example. The Accenture report is important, therefore, because it provides data and quotes from industry experts that address the longstanding relationship between advertising and entertainment.

Anderson, Chris. “The Long Tail.” Wired Magazine Issue 12.10. October 2004. < http://www.wired.com/wired/archive/12.10/tail.html>

Chris Anderson’s article “The Long Tail” (later expanded into a book) introduces the idea of the growing importance of the Long Tail in the way that media is marketed on the internet. It posits that the internet has allowed for a new profitability of the non-“hit” 80% of entertainment product (books, music, DVDs). Ultimately, he argues that the incorporation of the Long Tail into business and marketing models has been advantageous for the entertainment industry, the consumer, and for “culture” as a whole.

The concept of the rising profitability of the Long Tail is a major one in any argument regarding new music marketing on the internet. The Long Tail model is a fundamental example of the way that online consumption of media has changed (and, it is argued, improved) the music industry as a whole. Since 2004, when Anderson first coined his Long Tail idea, we have seen the effects of Amazon, Netflix, and iTunes’s feedback mechanisms for identifying taste and suggesting a focus on less-popular items. Clearly, the exploitation of the Long Tail by these distributors proves the profitability of internet-specific marketing models. Further, I believe that the growth of the Long Tail model has been a taste-making mechanism in the generations that have embraced these internet vendors—not only has the use of the Long Tail shaped marketing initiatives, but it has changed the way the consumer defines their own taste.

Carles. "Animal Collective is a Band Created By/For/On the Internet." Hipster Runoff. 13 January 2009. <http://www.hipsterrunoff.com/2009/01/animal-collective-is-a-band-created-byforon-the-internet.html>

In this blog post, satirical/ironic blogger "Carles" produces one of the most-discussed theses on Internet music of 2009. He posits that the band Animal Collective's most recent release, Merriweather Post Pavillion, was successful specifically because it catered to the tastes of it's internet-savvy audience. In doing so, Animal Collective has thereby defined what it means to be an "internet band": how to walk the fine line between mainstream and authentic taste; how to produce internet hype without immediate backlash; how to produce revenue despite a full-album leak. Hipster Runoff also references the importance of online-criticism mediums like Pitchfork and meme-production in determining the success and respectability of a band. Ultimately, he concludes that the success of Animal Collective is not only the result of but also a reflection upon the band's internet following: a "symbiotic relationship" uniquely achieved.

This Hipster Runoff post is important in the way that it was reflected on throughout the blogging community; it was taken with unusual sincerity, and both praised and criticized. The story of Animal Collective's new rise to prominence (Merriweather Post Pavillion is their fifth album) tells the story of the new internet marketing machine. This CD epitomizes a particular kind of marketing and revenue model on the internet. The Hipster Runoff post takes this a step further, as it analyzes how and why the internet-branding of Animal Collective was successful, and the way the branding of Animal Collective simultaneously contributes to a branding of self. Animal Collective and the Hipster Runoff analysis is an example of the way that online music critics, independent bloggers, and their music-savvy audience are responding to a particular kind of online music marketing.

This is a journal article in a journal called Popular Music, and it is by Eamonn Forde.  It was written in 2004.  This article gives information about the state of file-sharing in 2004, and explains that record companies shouldn’t worry so much about it.  The article’s argument is that record companies will still be able to sell a large amount of CDs despite file sharing, and that there are other forms of media from which they can profit.  
    The film and TV industries are also becoming upset about the use of P2P networks to share files, because many of them are video files.  In other countries, the government has tried to help these industries with the use of levies.  In Germany, there are levies on PCs and CD-Rs that go to record companies.  And all over the world, record companies are flooding P2P networks with fake versions of songs to frustrate the users.  This is called “spoofing.”
    I doubt the “spoofing” tactic works very well, and the levy idea seems unfair to the consumer, who would be forced to pay higher prices for goods.  This article is important to my research because it suggests it might be best for the record companies to ignore P2P file-sharing.  In France, CD sales have been going up by 5 percent every year, and they also have P2P networks.  It is possible that the record companies may just need more creative marketing schemes to attract more customers.  Also, they need to take advantage of the market for music on cell phones, because that market is less likely to be affected by file sharing.  As the author says, “Online delivery is not the death knell for record companies.  It should be seen, ideally, as the wake up call they so dearly needed.”  If record sales are still increasing in countries that face the same file-sharing problems, American record companies need to try to emulate some of these other companies’ strategies.  They claim that their lawsuits are necessary, but maybe if they are more creative, they can avoid angering their customers and causing additional damage to their industry.

59p.

Analyst report from ING Wholesale Banking (Equity Markets) on advertising agencies.

   Wright, Jon. "Leaders in Marketing."Journal of Marketing. Vol. 32, No. 1, (1968), pp. 62-63. 2 April 2008.       <http://proxy.library.upenn.edu:5549/stable/view/1249199?seq=2>

    As shorter workdays and lengthened vacations started to become the norm in the mid-1960s for middle and upper class families, leisure time became a subject worthy of study.  Once businesses starting to realize the implications of this new leisure culture, the need for leisure and recreation marketing increased.  E. Cardon Walker was the Vice President of marketing for Walt Disney, Inc. and was largely responsible for revolutionizing marketing in this era.
    Walker rose through the ranks of Disney starting as a messenger after graduating from UCLA in 1938 and eventually moving to the advertising/publicity department in 1949.  He was promoted to head of the department in 1950 and by 1960 became part of the three-man executive committee including Walt Disney himself that served as the top policy-making body.  Walker was in charge of sales, advertising, publicity and promotion.  In 1966 under his direction, Disney’s sales were $116.5 million and their profits reached over $12 million. 
     The marketing philosophy that Walker built for Disney in the 1960s has not changed much over the past half decade.  Walker’s philosophy is grounded in sound marketing policies.  Walker wanted to keep Disney limited to family entertainment and specifically film to maintain complete control of marketing from within the corporation.  Approximately half of the corporation was devoted to films and the other half focused on ancillary products such as sound tracks, merchandise and toys, all of which reinforced the advertising of the films themselves.  During this time, Disney was able to transition successfully from cartoon shorts to feature length animated films, to feature length live action films and eventually to television.  These smooth transitions show Disney’s flexibility and ability to maintain control over its market.  For example, when television emerged as a new means of entertainment, Disney embraced it instead of fighting this new technology and starting to produce television programs.  Again, Disney’s conservative but modern approach is apparent.  Disney did not expand its markets beyond the entertainment and film industry, and when it did, do so slowly and cautiously to avoid risk.  In addition, its marketing techniques have not changed significantly over the years.  At the same time, they were one of the first to jump on the television bandwagon and utilize marketing techniques to enhance their sales.

 Variety.com - MPAA tries to remove NC-17 stigma: Glickman takes a hard look at ratings

Sat., Mar. 10, 2007

 Variety.com - Fox Atomic brings new twists: Genre Label Adds to Conventional Tactics.

Tue., Feb. 20, 2007

 by Steven Zeitchick

The article discusses the creation of Fox Atomic--a division of Fox Film Entertainment dedicated to genre films and youth markets. However, Fox Atomic doesn't want to just create and market movies, rather "it wants to create entire worlds around those movies." The Fox Atomic website enlists current trends in digital culture to reach out to young, tech savy audiences. The studio has a presence in Second Life called "Fox Atomic Island, a virtual movie studio where citizens can pick up and play with avatars from all its leading pics." It also holds mashup and machinima contests, includes movie related video games on its website, as well as user forums and information on forthcoming releases. In addition, Fox Atomic has created a comics division that will release comics based on movie properties that are not adaptations of the films, but rather engage in "cross-media" storytelling. Current and upcoming film releases include The Hills Have Eyes 2, 28 Weeks Later, and Touristas.

Although other film studios and distributors have a web presence and engage with digital culture, few have ventured quite as far as Fox Atomic. The article remains skeptical as to the success of this strategy as it is still unproven in its ability to generate ticket sales, but this sort of "web 2.0" interactivity and media convergence may be something that film studios can ill afford to ignore.

“Supreme Court Finds Marketing Activity Creates Liability in Peer-to-Peer (P2P) File-Sharing Case” from the Journal of the Academy of Marketing Science looks at how the Grokster decision will affect the marketing of new technologies that could potentially have copyright infringing capabilities. In the Grokster case the court looked beyond the Sony ruling on the issue of whether the distributor induced copyright infringement. The court put forth the active inducement test which meant that a company could be held liable if the courts could interpret its actions as inducing, enticing or persuading its users to infringe on copyrighted works.

The Supreme Court has been trying to find the line to balance technological innovation and protect copyrighted materials. The members of the Supreme Court differed on the extent of protecting the Sony ruling. Justices Breyer, Stevens, and O’Connor believed that Sony protects distributors unless it can be proved that their products are almost exclusively used for infringement. Justices Ginsberg, Kennedy, and Rehnquist would have supported modifying Sony to require that distributors anticipate and prevent infringing uses. While at present time, the law does not require companies to anticipate infringing uses, firms can be held liable if they intentionally profit off of illegal uses. It is possible that future courts will see acts that would not previously be seen as intentional as being sufficeint to hold companies liable.

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In this scholarly paper, Arthur De Vany and W. David Walls discuss, among many other things, how the studios used the “blockbuster” strategy in which advertising, box office ranking, and movie stars play integral roles in a film’s success. They acknowledge Jaws as the first movie to employ this technique on a national level, using television advertising in addition to a nationwide release.

According to this theory, the opening of the movie is the most important event in a film’s life. Producer Robert Evans compared it to a parachute jump, “If it doesn’t open, you are dead.” De Vany and Walls believe that if the theory were true, the choices of early movie-goers directly affect the decisions of people who see the movie later. Furthermore, a strong opening weekend or week can lead to a “dominant position in the film market.”

Jaws is indeed a strong example of the “blockbuster” strategy of marketing because it was the highest grossing film at the time (dominating the box office), and created a national buzz about the film, which included television advertising. However, Jaws was somewhat different in that it did not have any big stars, but rather quality actors on the rise in the industry.

There are people who refute the “blockbuster” strategy and argue that the success of a film depends almost entirely on the early audience of the film and how those moviegoers express their opinions to friends, family and acquaintances. In closing, De Vany and Walls agree that the aspects of a successful film depend both on a strong opening as well as positive feedback from the early viewers.

In this article, James Surowiecki analyzes the marketing scheme of big Hollywood films like Jaws. In doing so, he looks at how blockbusters have been marketed since Jaws first opened in 1975. Among the factors discussed, the opening weekend and the behavior of the moviegoers are the most important.

In 1975, Stephen Farber, a movie critic, wrote that the success of Steven Spielberg’s Jaws was due to an “aggressive media blitz” that utilized prime-time television advertising along with an unusual national opening weekend at over 400 theaters across the country. Farber believed that audience members were manipulated into seeing the film and that the studio executives controlled what they wanted people to see.

As Surowiecki writes, Hollywood wanted to believe that the success of Jaws could be imitated by employing the same marketing strategies because there were huge profit opportunities. The studios believed that by giving certain films “a big enough push out of the gate” that enough people would go see it without regard for the actual quality of the movie’s content. This is called a “non-informative information cascade” in which the actions of the later moviegoers are based on the early moviegoers, who were persuaded to see the film due to the massive advertising campaign. Unfortunately, there have been many blockbusters that bring in large profits early on, followed by mediocre numbers in the following weeks (i.e. The Matrix: Reloaded).

However, as De Vany and Walls state in their in-depth study of what makes a blockbuster, they find that a big budget and expensive advertising campaign may make it possible for a big opening; its success truly depends on how the audience rates the film. This strategy has garnered some media criticism, but Surowicki argues Hollywood is sensible because this method increases revenues in a shorter time so that they can remove the film from theaters in order to keep a larger percentage of the profits.

This article has to do with video games that are based on movies and the profitability of these games. In particular, many video game companies are looking to acquire licenses for older, successful movies. The reason behind this is that the companies, like Electronic Arts and Buena Vista Games, see a huge potential market in selling video games based on popular films because they can market the games to the people who loved the movie.

However, as P.J. McNealy, video game analyst at American Technology Research, states, it is sometimes a difficult decision whether or not to make a game based on a new Hollywood movie or an established “Hollywood intellectual property” with a built-in audience. Games such as “Bruce Lee: Quest of the Dragon” had minimal success because the audience that appreciated the movie did not necessarily want to play the game.

The movie Jaws is a good example of an older movie that had huge success, thus Majesco decided to produce a game based on the film. Additionally, the release date was timed with the release of the 30^th anniversary edition of Jaws. By combining these two products, the company hoped to see interest in one market lead to interest in the other (i.e. video games and DVD).

The Vice President of Majesco stated in the article that “By adding the Jaws license, one of the best-known movies of all time, we instantly gave our game a better chance to reach the mass-market gamer, while allowing us to delve more into character and story.” Players will be able to control the man-eating shark as well as experience a different story line based on the blockbuster hit. The video game market adds another reason to the lengthy list of why Jaws and other popular action movies are able to have such lasting impacts on audiences because the games offer more action and information to the fans of the original films.

This article discusses the ways in which record companies are compensating for their losses through marketing.  After the Sony/BMG merge, Columbia Record Executive Charlie Walk, leads the way.  He asserts his belief that for the majors to stay in on the game they need to legitimize the online music downloading space and create alliances with consumer-goods companies to make a profit where it is being lost. Thus downloading has changed artist marketing too.