The New World of P2P Advertising

Katascope writes "Salon is running an article about targeted advertising on Napster and Gnotella. The worrysome part is the co-opting of P2P search databases to build profiles and advertise using instant messaging" I've always believed that targetted marketing might actually make advertising useful again (Any 24 year old who occasionally watches MTV and doesn't need zit cream knows this). This one is scary because people are sending you IMs based on the tunes in your napster share. Course I don't have IM, and use napster super infrequently, so I guess thats one way to not be annoyed. But frankly if I got junk mail about obscure Who stuff, I'd be happy. Much better then credit cards, viagra, and stock tips. As long as its opt-in. (michael: A number of people have written in with Cringely's comparison of Napster and subways. Good read.)

Comments

One of the things that sucks about America...

[d.valued]

We have no national privacy policy. In the EU, the consumer has pretty good control over the information that they give out. They have to be told what information is gathered, why it's being gathered, and that the information cannot be redistributed to anyone else wothout the consumer's consent. From Europe's Privacy Cops, a BusinessWeek article from '98 I dredged up:

The directive, which was negotiated among the EU governments over six years, guarantees European citizens absolute control over data concerning them. If a company wants personal information, it must get that person's permission and explain what the information will be used for. It must also promise not to use it for anything else without the citizen's consent. A company selling birdseed, for example, can't use its mailing list to hawk Audubon calendars. Citizens have the right to know where information about them came from, to demand to see it, to correct it if wrong, and to delete it if objectionable. And they have a right to file suits against any person or company they feel is misusing their data. One piece of the law is particularly stringent. Article 29 demands that foreign governments provide data protections every bit as rigorous as Europe's, under a similar regulatory structure. Those that fail, the EU warns, could find their data flows with Europe, the world's largest economy, outlawed.

Now, I like the idea that in the EU, my info is protected ad nauseum. Hell, there are police forces whose job it is to protect private data! The US is a database nation. By the time you're 18, dozens of companies have harassed you by phone, mail, Internet. Then, when you turn 18, dozens upon hundreds more start to crawl down your throat. I would like a law that gave the American citizen the same protections as our counterparts in the EU.
Ruling The World, One Moron At A Time(tm)
"As Kosher As A Bacon-Cheeseburger"(tmp)

What was the conclusion again?

[OlympicSponsor]

"I've always believed that targetted marketing might actually make advertising useful again..."

It's good!

"This one is scary because people are sending you IMs based on the tunes in your napster share."

And now it's bad!

"Course I don't have IM, and use napster super infrequently, so I guess thats one way to not be annoyed."

Still bad, but now not quite so!

"But frankly if I got junk mail about obscure Who stuff, I'd be happy."

Back to good! Incredible play folks--a full 360 in the course of 4 sentences--not just a "360" that's really a 180, but a literal 360.
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Cringely suggests a tax on CDR?

[typical geek]

What the hell is he thinking? Why should I want to subsidize record companies?

For the record, a few times a month I copy a commercially recorded CD on a CDR, but this is as an archival method. Almost all of the CDRs that I burn are for music that is allowed to be copied for no profit, ie. the Grateful Dead. If the artist who holds the copyright encourages me to make free copies, how would the RIAA get off in demanding that I pay them a tax?????????

If I want this kind of government intervention in my computer media, I'll move to Canada.

Re:Cringely suggests a tax on CDR?

[cpt kangarooski]

Gah?

1) Recording your own music (that is if you're a musician) should not be subject to taxes. That's a tax on speech, which is blatantly unconstitutional.

2) Musicians can copy music to which they hold the copyright an infinte number of times. A law mandating that they can't do so unless they pay a tax both infringes on their freedom of speech and copyright (if the tax goes to some entity other than the govt., which it does)

3) Recording other people's music can, under some circumstances, be quite legal. The normal set of fair uses of course. Time shifting if it's coming off of broadcast. No copyright infringement occurs in either case, so there's no justification for a tax.

4) Public domain recordings are legal to copy an infinite number of times, and preventing people from doing so again tramples on both the first amendment and on copyright (b/c copyrighted content has to become p.d. - effectively preventing that is unconstitutional)

5) The reason that DAT never took off was that it was killed at birth by the RIAA. They didn't want anyone to use the damn thing. If it had become popular we'd probably have CD and DAT as standards, and some migration to DVDA by now (though if they were that flexible, you'd also see CDMP3 and DVDMP3 compilations in stores...)

I also say to hell with taxes and restrictions on legal and protected speech and copying. The RIAA members have no more right whatsoever to make, sell and copy music than anyone else. There should be no special treatment.

Both articles are pretty good...

[lar3ry]

There is a flaw in both articles.

With regard to the IM-spam described in the Salon article, it won't work if the Napster user isn't running IM or IRC. It is quite possible to run Napster without being able to receive IM's, and to ignore stuff happening in the IRC window.

With regard to Cringely's suggestion of a CD-R "tax," I'd like to point out that not every CD-R is being used to make copies of audio CD's, or even archives of MP3's. A CDROM can hold ANYTHING, including a backup of one or more partitions on your system. Why should ANY money of mine be paid to lazy record company execs just because I want to make a copy of /usr/local? What if instead of audio tracks, I was making an archive of DIVX movies?

In all, I prefer the method mentioned in the Salon article, as there is an "opt-in" method, if you don't mind the spam.

The Cringely "tax" is regressive, and is as obnoxious as the "Microsoft tax" that people pay when they purchase PC's with Windows pre-installed on them, when they have no desire to run that operating system.

Interestingly, though, both articles show that more than one person is honestly thinking of how to make the Napster model work. Good try, Cringely. Better luck next time!
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Of Value, Subways, and Napster

[VanL]

There are serious flaws with Cringely's argument.
Most people only value things (privileges, objects, whatever) in proportion to their perceived cost of acquiring the thing.

My Mom used to be a social worker and anti-drug counselor. Initially, she gave her services free to those who couldn't pay. Relatively quickly, however, she was forced to change that policy; people would not show up for appointments, or expect unrealistic results in unrealistic timeframes, or even treat her badly. They didn't appreciate what they were getting for free. As soon as my Mom started charging a nominal fee ($5 I think it was), those problems went away. People valued her service more when they felt like they had invested in it.

Similarly, if the subways were "free", i.e., completely tax-supported, there would probably be positive side-effects not unlike those that Cringely mentioned. However, there would probably be more negative side-effects. The majority of people would start to think of the subways as having no value, or even worse, an entitlement. Vandalism would probably go up, and the amount of abuse on the system would jump exponentially.

Napster has the same problem. If the music were free, a lot of people would start to consider it an entitlement -- in fact, many already do. I predict that the amount of "abuse" of the artists would increase; people would expect new songs without appreciating the creative work it took to produce them. And even if the market for CD writers and such was temporarily greater than the market for music, the effect of what Cringely is proposing would be the crippling of *both* markets as soon as the market for elelctronic delivery and storage (the Cd-writers, etc) was saturated.

There are problems with my argument, just as there are problems with Cringely's. For instance, the evidence that CD sales go up because of Napster would seem to contradict my point. But that is only because having the CD adds value to the music -- lyrics, cover art, a physical medium, etc. However, if digital distribution of the *entire album* - including cover art, lyrics, etc - became the norm, there would be no additional value in buying the pressed CD.

Replies and rebuttals are welcome. I'm not saying that what Cringely proposes is bad; in fact, on some levels I support it. But the costs incurred by the tragedy of the commons must be addressed as well.

Want to make $$$$ really quick? It's easy:
1. Hold down the Shift key.

Cringely is wrong about the NYC subway

[XLawyer]

I don't know how it is in other cities, but here in Sodom-on-Hudson, fares pay a lot more than 15% of the operating cost of the subways.

Going to the MTA's web site, you can see budget figures for 1998. The New York City transit division's (that is, NYC subways, buses, paratransit, and the Staten Island railway) operating cost was $3.8 billion. There were just over 5 million paid rides on each weekday, and a subway fare is $1.50.

So let's do some back-of-the-envelope calculations. Assume that on weekends, ridership is 30% of what it is on weekdays. (I admit I have no basis for this assumption, but it seems reasonably conservative.) This works out to fare revenues of $2.2 billion for that year, or almost 60% of the operating cost.

The actual percentage for the subways is probably higher. That 60% includes the subsidized paratransit division, and the Staten Island railway. I have heard (but I don't recall where) that fares actually cover about 85% of the cost of running the subway.

Which is why they charge for it.

one problem w/ Cringley's view of Napster

[acroyear]

And its also a problem with my.mp3.com and any other service that negotiates to pay the RIAA or the publishing firms (ASCAP, etc...) for the right to exist:

Not everybody is covered under those organizations. Many smaller artists who's material is traded by napster users will never see income from the RIAA license. they're only chance for income is that the listeners like the material and purchase a cd directly from them later on.

ASCAP and BMI (and presumably, the RIAA would do the same for their cut) distribute income from site-licenses (such as public restaurants, bars, store p.a. systems, etc) based on one market value only: Radio Airplay. It doesn't matter that, e.g., Live365.com can log exactly what was played, and to how many listeners. It doesn't matter that a local pub is an Irish pub that never plays pop music.

Brittany Spears, her songwriters, and her producer will all get most of the money.