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IFX Group


Vaporware: The Lifetime License: an alternative media licensing idea

There is a growing problem with media licenses where the major licensing houses feel that every play should receive a royalty and consumers feel that once they pay for a title, they should be able to play it as often as desired for their personal enjoyment without additional burden.

These two conflicting views on licensing will ultimately cause a serious break down in the funding for the major media licensing houses as more consumers find alternate sources for their media independent of the packaging.

There is another way; de-couple the media from the content. This means to sell rights to the title at a specific quality separate from the physical container for that media.

In terms of music where the Apple online music store sells songs for $.99 and traditional brick and mortar music stores sell a CD with 10 songs for $15, $9.90 of that CD goes towards license and the remaining $5.10 is simply the cost for the container.

This licensing has some very strong benefits for the consumer including the ability to buy multiple different containers with the same song without having to pay multiple times for the media license.

The idea is that over the past hundred years of recorded media, one thing has remained constant - the recording packaging media continues to improve. If the consumer could pay a license fee for the CD-quality title, not the physical CD recording media, they would still be encouraged to buy newer media containers with higher than CD quality or content not available in the standard CD packaging.

By now it may be obvious that this appears to be a major problem for licensing houses that will be missing out on revenue potential from old title sales on new media. They are thinking of all the VHS movies that sold throughout the 1980's that also sold again on DVD in the 1990's. The sad news is that the typical home computer now has more than enough power and storage to completely remove the need for physical media - so unless the next distribution media offers something so wildly special that it overpowers the typical home computer, the consumer trend will continue away from physical media.

In the new world where physical media is no longer tightly connected to the content, the licensing houses have become little more than a way to monitor the distribution channel. If they do not accept and embrace their new role, they will simply become pointless as artists and consumers flee from their grasp.

A side benefit, once the licensing houses accept their new place in the world, is that a customer must identify themselves to take advantage of the lifetime license program. This allows demographics not possible in the media industry today and could lead towards much more cost effective product development and marketing programs with very little risk to artists and very little cost to consumers.