TED Conversations

Tim Pastoor

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What business models are outdated and what are the alternatives?

One example to begin with:

"SOPA & PIPA are not about copyright. It is about protecting a dying business model. (...)
This isn't about stealing for the movie industry bigwigs and their high priced lobbyists. It's about desperately trying to maintain the old familiar business model that afforded them a lifestyle of Armani suits, lunch at Nobu and limos. It didn't work for music and its not going to work for movies."

- David Meerman Scott


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  • Jan 25 2012: If a business model is truly outdated, it will collapse under the weight of its own incompetency and new ways of doing business will take their place. The only thing that really changes is who's wearing the Armani suits and how they're paying for them. Since everyone could not have Michelangelo paint their ceiling, should society have insisted that he pass on the Sistine Chapel? Scarcity is intrinsically rationed by the fact of its scarcity. I'm fine with replacing money as the means of determining distribution, but every other measure is just as arbitrary and demonstrably less productive and I say this as someone who's part of the 1% at the bottom of the scale. One might want to look at one's envy of Armani suits and being driven to Nobu in a limousine. If those truly are not how you measure the quality of your life, then why would you care if someone else has them? There is no straight line path that runs from Armani deprivation to feeding starving children. If wish that there were. It would greatly simplify the choices we make.
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      Jan 26 2012: Nice analysis David, and I agree with you on this one. The way 'the system' works nowadays is build upon the events that came out of human nature. People shouldn't do anything just to acquire an Armani suit in the first place. If you don't do whatever you do out of passion, you'll never fully enjoy what you're doing. And no, I don't believe in pursuing a life goal of getting that Armani.
      I believe in business models which pursue a social return on investment, instead of a financial one. Out of this, one can truly become successful and create a business model for the long term. I see new business models around me which are becoming successful, thanks to this concept. I hope the world will see many more, and that many more people will get inspired to create one of their own (especially with other people in a multi-talented formation).
      • Jan 27 2012: Why would one want/need an Armani suit in the first place? it is nothing more then a status symbol and has nothing to do with the cost and quality of the suit, and as such a totally inefficient way of distribution scarce resources.
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          Jan 29 2012: I still maintain that the remuneration of creative effort has to be directed to the effort - not the result. We used the model of gaining that remuneration at the point of transaction only because it was a practical way to do it that way, not because there was any underlying functional principle mandating the method. With digital media, the test of practicallity evaporates. It is now plain that the underlying functional principle is creative activity - not creative result. It is the activity that must be remunerated. What method matches that functional principle?
          If you have ever worked for a company, you will see that your terms of employment also include granting exclusive right of the result to the company - you are remunerated for your activity, the company enjoys the result exclusively - you have no control over it. Most are happy to operate under those rules.
          Of course, the company then goes on to re-market your intellectual results in order to pay you and gain a profit.
          Perhaps the corporate employment/IP model can be used, but that the corporation is taken from the process and the customer pays the worker directly for his activity. Paying for activity is a problem because most expect a product at the time of transaction.
          So if we then replace the company with a management collective that garners funds for the creatives within the collective, the results can then be released for free copy by the customers. Problem there is that not all customers have paid. Then we are back to the jelousy thing .. is that a real problem - the objective is to pay for creative activity - not to become rich?
          Assuming such a model could work, then what methods are available to attract funds?
          There is patonage and subscription .. is there any other way?
          It is in these methods that the real progress will be made.

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