Piracy as a leading indicator of sales

One great way to determine whether your digital product is destined for greatness is how many people want to steal it. The same goes for open source.

One great way to determine whether your digital product is destined for greatness is how many people want to steal it. As the television industry is starting to realize, there's a great deal of positive information that can be gleaned from illegal torrents of the shows. If no one wants to watch it, no one is going to steal it.

The open-source analog, of course, is the download. If you aren't getting free downloads, then it's probably futile to try selling a product. Downloads, in other words, tell us a lot about future purchases, assuming there's a compelling business and revenue model behind the download. According to an article on Last100.com:

Tech-savvy consumers have been boldly declaring that piracy can help and not hinder industry for years (especially when it comes to music downloads), but I was shocked the first time I heard the same claim from some very knowledgeable marketing types one day over a year ago in a boardroom. One of them simply asked, "Is the show on BitTorrent? How many people are downloading it??" The rest of the group looked genuinely interested in the answer from a demand point of view, not from an outraged one. I've since heard the same thing again several times, from different companies.

An even more interesting thing has started to happen: unofficial, but sanctioned television show leaks on BitTorrent. Broadcasters aren't posting their shows directly on PirateBay yet, but they are talking informally and giving copies of shows to a friend of a friend who is unaffiliated with the company to make a torrent. Why? Well, it's partially an experiment, but the hope is that distribution of content this way will lead to new viewers who wouldn't have been reached through traditional marketing means. Early signs indicate that these experiments are working.

The TV industry needs to explore ways to take advantage of piracy. While people will gladly take a free product if offered it, they'll also likely pay for a complement to that product. Hence, TV watchers have long "paid" for free TV with taxes (U.K.) and advertising (U.S.). In a world of TiVo, there may need to be new means of monetization devised, but the value of the piracy for indicating a potential market should not be underestimated.

(Via Slashdot)

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About the author

    Matt Asay is chief operating officer at Canonical, the company behind the Ubuntu Linux operating system. Prior to Canonical, Matt was general manager of the Americas division and vice president of business development at Alfresco, an open-source applications company. Matt brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. He is a member of the CNET Blog Network and is not an employee of CNET. You can follow Matt on Twitter @mjasay.

     

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