It is apparent that the traditional business model of the recording industry hasn’t been working. They have seen dramatically declining profits for the past 10 years. Topping the record companies’ claims for the reason of this decline a lack of copyright enforcement in digital spaces. With current technology it has become far easier to download, in most cases illegally, than it is to go out a purchase the music legitimately. Purchased music is on the decline, but music saturation is on the rise. It is obvious that the demand for content has not decreased, but desire to pay for it has. In a system that is seeing a significant loss of returns, one aspect of the music industry continues to perform well if not significantly better. The live concert industry.
Why does a fan go to a concert? They most likely already “own” the music. They have the same songs on their ipod, computer, and stereo system. Surely the sound quality is better at the fan’s home where they can listen to the digitally re-mastered music playing out of quality speakers, rather than at a nightclub or bigger venue. And yet, fans continue to go to concerts even when ticket prices are in excess of several hundred dollars. They go, not entirely for the music or content of the show, but for the experience of the event itself. In the words of Yahoo Answers user Jukebox Breakdown (when poised a similar question), “The main reasons I go and see a band in concert is because I love the band’s music and want to see them perform it live. Listening to a band’s music with other fans give[s] you a feeling like no other. You’re all there for the same reason. It’s like one big family. Going to concerts, for me, [is] like taking drugs. I need them to feel good” (Jukebox). So in reality the audience is not paying for the music at the show, which they have likely listen to hundreds of times before, but they are paying for the shared immersive experience.
Like the music industry, many other media content providers are struggling to successfully transition their business models to a digital environment. They have to address similar problems with pirated content in addition to lagging advertising sales. However, unlike the music industry, many media providers do not have an equivalent to the live concert. As these media providers look for ways to monetize their products in the digital age, perhaps they will turn to monetizing the experiences surrounding their content rather than just the content alone.
Experiences are a dominant form of cultural expression. Before there was TV, radio, or the Internet, audiences gathered at physical places to consume culture. At its most rudimentary level, this community interaction is the “experience” that media producers could try to recreate and foster in order to monetize their content. Technology, like the television, originally replicated an experience and transplanted it across the country. In the early days of television a concert would be shot live and broadcast. This created a shared experience that had not been available to a home audience before. Furthermore, there was a sense of urgency intrinsically embedded within the media, because it had to be viewed right then or not at all. Today, however, content is easier to record, rewatch, and copy this has left media experiences in a precarious position. A position where only some pay for content and they disperse it to the others who didn’t.
Many other business models are based around experiences. Think of a baseball game and the urgency that surrounds it. A person could record the game and watch it a month later, but the thrill in a baseball game is that it is live. Even more thrilling is being at a stadium or at a bar watching the game. A fan will pay for tickets or beers, when they could just as well watch the game at home for free. This experience is created out of the live experience that a baseball game creates. Most TV does not encourage this type of experience-based behavior, because it is not in the live TV format. It is hard to imagine fans of a traditional TV show like Law and Order participating in a ritual experience like the one surrounding baseball. However, there are examples of taped (non-live) TV shows that create spaces for their fans to experience the urgency of the show. Shows like LOST and Heroes manage to foster a sense of urgency in their content. This translates from the TV screen to the living room and then into Internet spaces. LOST’s urgency is spawned by complex mysteries and cliffhangers written in as plot devises. Fans of the show are driven to unravel these mysteries through online community discussion groups. One of the most popular of these websites is a highly trafficked site called “Lostpedia.com”. Interestingly, “Lostpedia.com” is an unofficial site meaning that it is unaffiliated with ABC, the producer of LOST. While this site does drum up more buzz around the show. ABC is missing out on a possible experience based monetary stream.
Star Wars is a venerable cultural brand that shows a model of how an experience can be monetized. They use a classic fan club model that they call “Hyperspace”. Hyperspace allows fans to get exclusive content and discussion boards. While the content itself eventually will disseminate amongst all of the fans (even those not using Hyperspace), it is the other perks that encourage fans to continue to pay for membership. These experience based perks include, sneak peaks at new Star Wars projects, Beta testing for new site features, exclusive discussion boards, and user profiles (Hyperspace). Fans pay the toll so that they are able to be involved with the Star Wars fan community. The membership cost $14.95 and demonstrates the lengths that fans will go to in order to access the urgent and community. Since the content from the discussion boards will invariable be leaked to unofficial channels it is only the single person experiences that make a membership uniquely valuable. This could be an option for shows like LOST, adding not just additional content online, but additional experiences for an individual to explore.
Besides urgency another key concept needed to understand experiences is community. Sites like StarWars.com are a digital space in which fans can create and share their own content that is themed in the cannon of the Star Wars imaginary-entertainment environment. In Derek Johnson’s interview of Will Brooker, “Star Wars Fans, DVD, and Cultural Ownership”, Brooker argues that a cultural icon like Star Wars has become as much the property of the fans as that of George Lucas. The interview is in reaction to a revised version of the film that was being released on DVD in 2005. However, Johnson mentions fan online experiences when he states, “In this intersection of realms of audience and producer Brooker offers a theory of “overflow” in which the experience of media consumption has been altered and expanded by the spillover of textual content onto internet sites that offer immersive, more participatory experiences,
where audience members are actively encouraged by designers to contribute to the production of cultural content” (Johnson 37). “Overflow”, as Brooker describes it, is all the tertiary content that is not explicitly in the Star Wars movies. For example the overflow of content can include websites, video games, books, fan fiction, and remixes. While it is not unheard of to monetize overflow, many content producers have not truly maximized its potential. The additional profits from the monetization of community works may not act as an exclusive source of revenue, but could certainly work in tandem with other sources such as ads. One must also remember that official overflow needs to be carefully monetized. Too many ads or too high of fees can make the overflow content seem disingenuous and can lead to users abandoning the site for unofficial ones leading to associated loss of revenue. Community is a difficult thing to foster and subscription based business models are also tricky in an age when so much is free online.
Agency plays an important role in creating full-fledged media experiences, because it adds to the immersive nature of the experience and allows a user to govern some control over the media itself. American Idol makes a fascinating study of experiences not only because of the urgency that it creates, but also because of the community it develops both in the online space but also around the water cooler. It has more than just a television show it is a worldwide phenomenon. One of the reasons that the show has created such buzz is that it invites audience participation. The audience is encouraged to vote for contestants, with the winning ones remaining on the show until its finale. The audience is able to extend their agency into the world of the show and American Idol is able to monetize this extension.
In 2002 AT&T’s revenue for SMS messaging in the Untied States was little more than a couple million dollars. This is not very impressive when compared to Europe where text messaging was a $14 billion dollar market the same year (Elkin 2). However, this was about to change thanks to a deal that was quite lucrative for both American Idol and AT&T. Rather more traditional means of voting such as telephone or email, text messaging provided a way for both companies to charge for this interactive feature. Furthermore, since text message charges show up on the user’s monthly bill it is not a huge hassle to charge an additional fee for the feature. This means that users can vote without having to think about the exact monthly charge as they vote. AT&T claims that it cost the average subscriber around 10 cents per text message (Elkin 1). With AT&T’s 22.1 million subscribers and American Idol the top ranked show it is easy to see the potential for profits (users are, of course, not limit to a single vote). Tobi Elkin of Ad Age points out the further potential of messaging when he writes, “With ‘American Idol II,’ AT&T Wireless is expected to push SMS beyond voting, offering subscribers with SMS-enabled wireless phones the ability to engage in text-based messaging activities such as gossip, games, jokes, quizzes and real-time chats with fellow ‘American Idol’ fans, the contestants and possibly the judges, as well as other interactive experiences” (2). SMS messaging provides a monetization stream in which interactive overflow is allowed to swell. It shows a method in which a content provider uses urgency, community, and agency to create an experience that is unique for each individual audience member.
Canadian Idol is almost a carbon copy of its American sister show. The producer’s methods are in the same vein as the techniques that the American version utilizes. Canadian Idol’s producers, according to Doris Baltruschat, “attempt to create all-enveloping experiences that transgress the boundaries of traditional broadcasts. They accomplish this by staging media events and engaging audiences in online environments” (42). This technique of expanding a show so that it becomes “all-enveloping” affects an experience. The experience now transcends the limitations of the screen and even the urgency indicative of a live show and has become fully immersive. Immersion is enhanced by pervasive technologies, such as computers, mobile phones, and enhanced television. These technologies allow audiences to create a simulacra Idol environment around them, where they consume the media through “cross-platform interactivity” (53). The immersive experience requires that the audience be allowed to participate in the show’s content. “Interactivity is built into reality formats intentionally to increase profits margins through text messaging, enhanced character identification, and immersion in virtual communities (as in the case of Canadian Idol’s online chatrooms), in which commercial products are often key in resolving the narrative arc,” states Baltruschat (53). If a viewer wants to get involved in any of Idol’s overflow they better be prepared to pay for their immersion.
Immersive experiences allow for the greatest perspective of monetization. This is due to the connection and relationship that the audience member has with the environment in which they are immersed. In the Idol shows it can lead to downloading usable content like mobile ringtones or sending text messages. However, this is merely paying for part of the experience rather than its entirety. Online games are an example of the massive earning potential that immersive experience can produce. Games like Second Life and World of Warcraft (WOW) demonstrate different, yet successful models for charging for experiences. WOW charges users a monthly subscription fee, while Second Life provides free membership but taxes digital property exchanges. Another characteristic that WOW and Second Life have that make them so popular and such a valuable business model is that a single game never ends. Unlike a television show, there is no official ending to the experience. A player could feasible start a game and play for years. The game producers continue to reinvest and provide game enhancements so that the game remains fresh and continually enjoyable for its players.
The World of Warcraft is a MMORPG or massively multiplayer online role-playing game. This classification of game cannot be pirated, because it needs to run on the producer’s server subsequently connecting the multiple players. The game is intrinsically based around the community experience and therefore is able to successfully monetize that experience. A player is unable to play the game offline or without a subscription. Since WOW requires agency in order to experience the play, it cannot be copied. Or rather, if it is copied it can only be a video pf single player’s experience or that is copied. There is a drastic difference between playing a game and watching video of someone else’s play. This is a further example of how an experience differs from content, because unlike the game a video copied off of TV is the same no matter the number of copies.
Struggling traditional content producers can learn from the successful examples of monetizing experiences and apply interactive aspects to their shows. By making the business model involve either live broadcasts, overflow environments, communities, or audience agency they can possibly discover new streams of revenue. Content producers can combined all of these aspects to create an entire immersive experience for which users are certainly willing to pay. It is estimated that the World of Warcraft has over 12 million subscribers as of April 2009, and each of those pay $14.99 per month making it an extremely profitable business model (Holisky). Like the live music concert, an immersive experience provides its users with interaction that they cannot get from content alone. Perhaps, these online experiences will become more prevalent in the future attempting to recreate the analog world digitally.
Works Cited
Elkin, Tobi. “AT&T Wireless to drive texting through alliance with ‘Idol II’.” Advertising Age Vol. 44 Issue 2 (2003): 4-49. Academic Search Premier. The New School, New York City, NY. April 2009. <http://www.ebscohost.com>
Baltruschat, Doris. “Reality TV Formats: The Case of Canadian Idol.” Canadian Journal of Communication. 34 (2009): 41-59.
Gray, Michael. “World of Warcraft hits 11 million subscribers worldwide.” WoW Insider. 28 October 2008. 25 April 2009. <http://www.wowinsider.com/2008/10/28/world-of-warcraft-hits-11-million-subscribers-worldwide/>
Holisky, Adam. “WoW subscriber numbers still increasing, multi-boxers trivial.” WoW Insider. 6 April 2009. 25 April 2009. < http://www.wowinsider.com/2009/04/06/wow-subscriber-numbers-still-increasing-multi-boxers-trivial/>
“Hyperspace.” StarWars.com. 2009. 25 April 2009. <http://starwars.com/fans/hyperspace/>
Johnson, Derek. “Star Wars Fans, DVD, and Cultural Ownership: An Interview with Will Brooker.” The Velvet Light Trap 56 (Fall 2005): 36-44. Academic Search Premier. The New School, New York City, NY. April 2009. <http://www.ebscohost.com>
Jukebox Breakdown. “Why do people like going to concerts to see bands live?” Yahoo Answers. 11 September 2008. 25 April 2009 <http://answers.yahoo.com/question/index?qid=20081109135036AAOeF0R>
