A time for new business models

A time for new business models

DVD RentalInteresting post today on Techcrunch about the current debate around copyright law and Viacom’s $1 billion lawsuit against YouTube. I’m not going to enter into the merits of whether Arlington is right or wrong, but instead focus on that last paragraph of the post:

…it’s time for copyright holders to rethink their business models. The winners won’t be the companies that win or lose billion dollar lawsuits. It’ll be the companies that throw out everything that’s come before, and build new businesses around the natural behavior of people. Remove friction and win.

This message has been bandied around for some time now, and today is truer that ever. Business who focus on consolidating their position are bound to be overtaken by others who are innovating and pushing the envelope.

An interesting analogy can be drawn with the movie rental market. 10 years ago, the corner shop was king. If you wanted to outdo the competition, you built larger shops, opened new geographical locations or stocked your shops with more and better movies. Today, this strategy doesn’t work because the environment the companies operate in has changed. The rental market has moved to more convenient models, whether it’s postal services or Internet delivery, the old method is dust. Adding floorspace to your retail outlets isn’t going to matter one bit, neither is opening more stores. The world changes, embrace it and look for new opportunities.

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