What We’d Rather Not Admit About E-Commerce
Many thought today’s pirate release of an unfinished version of the film “X-Men Origins: Wolverine” was an April Fools’ joke. Had it been a tease, full of strange character choices and obscure in-jokes for comic book fans, I would have applauded 20th Century Fox for a viral marketing masterpiece. Instead, what we have is a case of Internet piracy the New York Times has deemed “unprecedented.”
There’s a dirty secret about the economy of the Internet, one that users of my generation (the Y one, namely) don’t want to admit. We expect our digital media delivered for free. Somehow, this feels right to us. And if there’s a reasonably easy way of obtaining licensed, commercially released media without paying for it, odds are we will choose that over the legal avenues.
While iTunes, Rhapsody, and now-legal Napster have had great success with their online music stores, we need to put that into perspective. Anywhere from 50 to 90% of all Internet traffic comes from peer-to-peer or bittorrent traffic, most of which is music and video. Imagine what kind of profits these companies would be making without Internet piracy taking most of their potential customers away.
My generation grew up when Napster was still the underground, pre-RIAA wonderland of free music. In our formative years, we came to expect and love free media. These days, YouTube and Hulu only serve to reinforce the notion that information ought to be free.
Newspapers attempting to survive online discover this attitude quickly: subscription-only news sites rarely survive. The only viable source of income for content producers is advertising, which cycles right back into creating content to attract advertisers and users.
What emerges, then, seems to be two closed economic systems that only interact at the point of consumption. Internet media content producers and advertisers exchange money in a capitalist model of supply and demand—the more pageviews, the higher demand for that advertising space.
But that money doesn’t really come from consumers, at least not directly. Only when media consumers respond to those advertisements does extra money enter that closed capitalist system. The rest of the time, media consumers exist in a world of free information at their fingertips, which they can share and re-mix as they see fit.
Lawrence Lessig might cringe at the observation, but when it comes to media, e-commerce is becoming e-communism.
Now I know this isn’t universally true, but it is largely generationally true. And my generation is about to come of age with our disposable income. I suspect we will find new ways of not spending it on music and movies.
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