The Pirate’s Dilemma: To Compete or Not To Compete

Written by Matt Mason on March 14, 2008 

It’s hard for large organizations that move at glacial speeds to compete with individuals taking their content and creating new distribution systems, revenue streams and business models, but the fall of the major record labels taught the rest of the corporate world a lesson. In many cases, piracy it is helping people to innovate and create new legitimate market spaces.

Last week I did a keynote speech at The Medici Summit on The Pirate’s Dilemma, focusing on when and how it’s best to compete with pirates. When I was writing the book, I thought many large corporations wouldn’t be open to the idea that they can learn from piracy, because of the way the major labels reacted to it, but I’ve been pleasantly surprised to find many that are trying to do exactly that.

Previously: MTV Uses P2P Data for Playlist Selection

Next: Japanese ISPs Agree to Ban Pirates from the Internet

88 Responses (Add yours or TrackBack)

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26 Mar 15, 2008 at 04:26 by h33t

you gonna buy his story about Bill Gates?

Bill’s mom and dad gave Bill $1Million on his 21st birthday. they were on the same church dioces as the chairman of IBM who sold Bill DOS for 1 buck

Bill Gates was sponsored from the beginning by an uneconomical transfer of the DOS code which became MSDOS

27 Mar 15, 2008 at 04:43 by h33t

Matt Mason your minute of fame is in your own pants and by naming the greats none of their kudos falls on you and at the end of the day your bank is full of bucks from your sugar daddies but you made ZERO contribution to filesharing or net neutrality or free acess but that is not your objective because you are a media whore

finally, he defends vista saying it is more economical than linux … he equates open source, linux, with piracy omfg

if it is true that people who have a fat salary from a big corporation buy Matt who is paid by them to make his fancy presentation then nobody is surprised

the 100% WRONG Matt does is equate free = piracy

Matt if you really want to earn a buck and support the future and teach the encumbents how to shape up for the future then send a mail to admin@h33t.com

bottled water? you are an assclown

28 Mar 15, 2008 at 04:51 by h33t

the dvd sellers on canal street complained that downloading was hurting business …. and Matt hopes his argument benefits from that statement?

the sellers on canal street are pirates because they sell illegal copies for profit. that is the definition of piracy

filesharers are not pirates their activity is not for commercial profit

Matt is typically confused about this

freak i hope you are not

29 Mar 15, 2008 at 05:55 by interested viewer

Well, he could easily be on the corporate blood-suckers side, but he might not be, and at any rate, he is an intelligent man and great speaker;
obviously I’ve been making some of the same statements for ages:)
[quote]piracy is a market indicator;
fighting is one response, but
not often the best response.
if pirates are adding value,
in some way, you should look
at competing with them.

People are not competing with
pirates with the way they should
be.

So when piracy is effecting your
business, you really have two
choices; you can either fight
piracy in the courts, or you can
match pirates, play for play, in the
marketplace.

To compete, or not to compete?
That is the question, ladies and
gentlemen; that is the pirates
dilemma.[/quote]

30 Mar 15, 2008 at 06:25 by interested viewer

[quote comment="311668"]Matt Mason your minute of fame is in your own pants and by naming the greats none of their kudos falls on you and at the end of the day your bank is full of bucks from your sugar daddies but you made ZERO contribution to filesharing or net neutrality or free acess but that is not your objective because you are a media whore.[/quote]
I’m tempted to agree; he understands ALMOST all of the economic principles very well [except, you know, for the only big one]*[but he got almost all of the smaller ones!!!], too bad he doesn’t understand the philosophy of the event too; while the cadre of people holding the philosophy over the economics is 1/k the total people using p2p, it is 100% of those doing the development.

[quote]finally, he defends vista saying it is more economical than linux … he equates open source, linux, with piracy omfg[/quote]
Nah, he was illustrating that for-cost products can massively beat out free products, even when the free product is universally judged superior on every important front. It was a really good example, and I was very impressed;
He did viciously abuse the numbers, though; people in general are idiots, and of the intelligent, not many are necessarily computer-literate [him for example:)].
Vista is pre-installed on 90%+ of new sold computers over the past two years. Its not like a computer buyer gets a checklist of things he wants, like (a.Vista, b.XP, c.Linux, d.OS X).
If he did a comparison between number of people who DELIBERATELY purchased vista, versus people who DELIBERATELY aquired Linux, the numbers would be MUCH less flattering for Vista.

[quote]if it is true, that people who have a fat salary from a big corporation hire Matt, who is paid by them to make his fancy presentation, then nobody is surprised[/quote]
True; because he understands piracy much, much better than they do, as well as how to react to it (compete don’t sue). He may not get all of it, especially the philosophy, but he understands the meaning of the phenomenon.

[quote]the 100% WRONG Matt does is equate free = piracy[/quote]
No; wellll,actually… if he does, its in such an indirect way that it is meaningless and accidental. Each time, the “free=piracy” message paled in comparison to whatever topic he was speaking (”pirates=competition”,”can compete with free product”,”you music/movie/media/industrial corporations were born as pirates”,”if pirates contribute to society, they aren’t a bad thing”];stuff like that.

[quote]Matt if you really want to earn a buck and support the future and teach the encumbents how to shape up for the future then send a mail to admin@h33t.com[/quote]
sorry, I don’t get it; It’s late and I’m pretty tired:)

[quote]bottled water? you are an assclown[/quote]
No, there have been many, many people protesting bottled water in the past; its just they are all hippies and tree-huggers, so nobody pays any attention.
Bottled water actually is an enormous scam. Notice how in the 50’s, modern refrigeration and dairy farms –> “Don’t just drink a glass of milk a day; science says you should drink 3 a day!”, whereas in the 80’s bottled water was born, and “scientists” said “Don’t just drink water when you’re thirst, because then its too late; drink water ALL the time!”.
Yeah, you can say growth in the industries made it possible to drink so much, but I’m going to say the pulic advisories were BS to jumpstart the respective industries.
Long story short: bottled water is a scam; if you are at home and thirsty, get a glass of water. If its not drinkable, bitch to your mayor.

*He identified the concept okay; pirates exist because the market wants them; consider them as competitors, and offer at least as much as them; shouldn’t be too hard for a multi-billion $ company versus unorganized pirates.
He failed to identify the correct method, though. iTunes [fuck apple and all its disgusting seed] proved that people are willing to pay money for what they can get for free, its just people won’t pay insane amounts of money for what they can get for free.
Translated, this means that (many) PIRATES WILL PAY AND DO WANT TO PAY FOR THEIR GOODS & PROPERTY; but the more you charge, the more we will reject you.
Movies ARE NOT WORTH $25, they are worth $3-4. CDs ARE NOT WORTH $15. They are worth $3-4. [don’t care how much it cost to produce, they both provide at least two hours of entertainment [since I like to listen to CDs several times, but only watch (most) movies once.
When companies take a profit from their work, then good for them. When companies shit all over the people who once wanted to give them money for their products, well then its time to find alternate suppliers.
The solution is hardly as difficult as being better than the pirates; the solution is to sell your products, permanently, for WAY less than you do now. That’s it. Drop your price 80%, forever. Its that easy, and that’s the part he missed.

31 Mar 15, 2008 at 06:35 by Wow..

H33t; you need to get a life and stop trolling websites.

32 Mar 15, 2008 at 06:42 by PoacheR2k

[quote comment="311636"]
Epic fail.[/quote]

You still do h33t :)

Nice response “interested viewer”, I very much aggree with you in most parts.

33 Mar 15, 2008 at 06:48 by Damon

Well as per some people come out to bash a rather well done presentation. Also notice how Matt is selling the book whilst advertising it on a site that is geared towards piracy (call it what you like, you dont pay for it, you dont own it, up to the person if he is ok with that). Yet people want to buy it knowing they can get a free version, he has earned his wage. I buy music I like because I feel that even though I got it for free, its worthy of the price it asks. If anything he highlights that no longer can you expect to be paid, you have to now earn it.

34 Mar 15, 2008 at 07:08 by prodigydancer

@h33t

I haven’t read the book, but I don’t trust “nice” presentations and your words make sense. In case of Matt Mason I see a man who wants to make his little profit on filesharing one way or another. Can’t say I like it.

@Matt

You can sell this PoS about “new distribution models” or wahtever to fat media pigs, no problem. We don’t care. But if you tell them that your views are P2P comminity views be prepared to get a copy of your book stuffed up you @$$.

35 Mar 15, 2008 at 08:01 by ace hall

reminds me of Dogbert’s defination of con-sultant

36 Mar 15, 2008 at 08:12 by Rycon

Hes making up this whole bull shit dilemma for himself..

when did this become a dilemma?

THERE IS NO DILEMMA!

You either compete or you die, how many fucking examples do we need to make, COMPETE OR LOOSE, THAT IS YOUR CHOICES..

why do they not understand that.. this piracy situation is so far out of reach, stop even ACTING theres something you can do about it other then compete.

The Pirate’s Dilemma: To Compete or Be Owned

37 Mar 15, 2008 at 08:52 by a/s/l

h33t, shut the fuck up and move on.

38 Mar 15, 2008 at 08:52 by h33t

disregard that, i suck cocks

39 Mar 15, 2008 at 09:47 by Enki

Thank you for teaching the corporate killers how to make even more money. We are toxifying the planet and our bodies. The lust for profit is destroying biodiversity, and making life nearly unlivable for the majority of its human citizens. It’s also driving us mad. We’ve lost our compassion for one another. And corporations are replacing governments. He mentioned Wal-Mart. The typical Wal-Mart supercenter carries 900 different wood products. An area of forest the size of a football field is cleared every second. That’s 86,400 football fields a day. In tropical forests, it’s estimated that 50,000 species become extinct each year because of deforestation.

The enslaver of peasants around the world. What a corporate robot.

40 Mar 15, 2008 at 12:20 by david

where can you see the presentition? the links in the article don’t lead there

41 Mar 15, 2008 at 14:54 by um, yar?

Good speech. A bit beyond the mental capacity of some of the commenters by the looks of it, and considering it was layed out so even dimwitted coporate types could understand, the likes of h33t must be severely mentaly retarded. And Enki, wel what they fuck you’re talking about who knows or cares, stupid tree hugging hippie.

42 Mar 15, 2008 at 15:04 by ace hall

” 38 Mar 15, 2008 at 08:52 by h33tQuote h33t

disregard that, i suck cocks”

haha,let me help..
————————————-

[cc] close captioned for imagination impaired.

h33t:(muffled sound)deesregud th_t,(mouthful) eiii sukfkiing chooock.

43 Mar 15, 2008 at 15:10 by As An Industry Slowly Dies.....

It just goes to show that at least some industry people get it and are progressive enough to realize it’s time to build the future instead of defending a past business model that is dying from it’s own stagnation, greed, and arrogance.

[quote comment="311567"]Great presentation. I’ll be buying your book the next time I have the chance. :)[/quote]

I’ll be downloading it. :P

44 Mar 15, 2008 at 15:28 by PHOTO

Download some excellent photos for wallpapers:
http://rapidshare.com/files/98182564/excellent_photos.rar

45 Mar 15, 2008 at 16:09 by PDoS32

you cant teach an old dog new tricks

46 Mar 15, 2008 at 16:29 by Zach Holliman

[quote comment="311748"]Hes making up this whole bull shit dilemma for himself..

when did this become a dilemma?

THERE IS NO DILEMMA!

You either compete or you die, how many fucking examples do we need to make, COMPETE OR LOOSE, THAT IS YOUR CHOICES..

why do they not understand that.. this piracy situation is so far out of reach, stop even ACTING theres something you can do about it other then compete.

The Pirate’s Dilemma: To Compete or Be Owned[/quote]
+100, x1,000

Yeah, it is that obvious; its just that after ten years of being beaten in the head, they (media companies) still don’t get it, so he spelled it out for them in words of two syllables or less.

I totally agree, its really really obvious.

Its just that the corpo-rats are SOOOOO stupid, they really need it spelled out like that; even so, maybe one in a hundred got the point!!!

47 Mar 15, 2008 at 16:40 by Sal

I liked the presentation. We’ve all got our views, but this guy is “turning around” concepts on piracy.

That there’s no point suing your customers. [Agreed]

That this is cutting edge business model - get over it [to the music industry].

That the day of the CD is fast coming to an end - customers prefer to download.

He’s staying a lot of the same things that we are. Standard copyright laws can’t apply now. Customer enjoy remixing - so allow them too - as a business model.

Only the corporations are paying him to say it. That’s the corporations for you!!

48 Mar 15, 2008 at 16:47 by yogi

What a beautiful, fascinating and insightful presentation!!!

Thank you Matt!!

49 Mar 15, 2008 at 17:00 by n1

[quote comment="311541"]thx for the stream

@3 you can rip/save it to hd if you have firefox[/quote]

I have Opera and can do that too :P

50 Mar 15, 2008 at 17:51 by Norm

Nice presentation, but I don’t think it goes far enough. I don’t think piracy is creating a new business model for record labels or software companies - I think it’s destroying labels and software companies and replacing them with open alternatives.

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