Several months ago I stumbled across this great article by Todd Woody called: The Race to Kill Kazaa. You probably have used some sort of peer-to-peer file sharing program since the advent of Napster – and there are literally dozens of similar programs.
In Mr. Woody’s story he mentions a new legitimate service that Sharman Networks (the creator of Kazaa) has developed and is now deploying: Altnet. I tried to access the Altnet website after reading the article but could not access it (nor could I a few weeks later). However, I did end up finding this summary off of Kazaa’s site.
A couple weeks ago I decided to take a peek once more and was pleasantly surprised with a living, breathing website. Here’s the skinny: you sign up, pay $99 and they help you distribute your content via two separate channels, both of which use the Kazaa P2P software. All of your work is “protected” with the latest contentious acronym: DRM – Digital Rights Management. It’s actually not too shabby of a deal as trying to replicate your software or music is next-to-impossible (though I’m sure there are hackers trying). Additionally, you have access to tens of millions of Kazaa users (not to mention all the ‘lite’ versions).
If you aren’t familiar with how the Kazaa software works, here is a quick tutorial. First, it has a search tool which operates just like a search engine. Their programmers figured out a way (primarily though Supernodes) to index Petabytes (1,000,000 GB) worth of data for instant (no more than 20-30 seconds) results. Additionally, the query tool is broken down by type: Audio, Video, Images, Documents, Software and Playlists.
So if you are in the mood to watch Dr. Strangelove all you do is: load up Kazaa, go to the Search menu, click on Video and then type in Dr. Strangelove. I’m pretty sure you can figure out the rest of the necessary requirements needed to complete a transfer (if I didn’t say the actual words I can’t be held liable).
Altnet utilizes credit card payments and payments charged to your phone bill (I guess they assume everyone has a phone, MacGyver didn’t). Altnet also created an easy-to-understand slide-show explanation that can be viewed here.
So how does this help you launch your Polka career? Well, I am actually going to try and convince my musically inclined sisters to publish their material with Altnet. $99 is could be a lot cheaper in the long run if you compare it to competing products (though it also depends on the target demographics, disposable income, etc.).
For instance, using Text Ads from Overture (Lycos, Alta Vista, FAST, etc.) will cost you at a minimum of $.05/click (depending on what the key word is it can cost up to several dollars – guess what their competitors do all day: click on that keyword to rack up charges). Google and Yahoo have implemented similar services on their search engines (quite successfully too, Google recently acquired Applied Semantics - which I discussed briefly here).
Here is the math: you purchase the key phrase, Big Band Music, (the user has to type that exact phrase in) at Overture for $.05/click. Note: you might see the acronym PPC, it stands for PayPer Click just like PPV does for PayPer View.
For the same price of having your product listed and deployed by Altnet, your TextAd at Overture can be clicked on 20,000 times. That does not mean 20,000 individuals will purchase your product. To be conservative, just use a 1% conversion ratio (note: this assumes that your website looks decent, is navigable and there is a market for your product or service).
At 1% you receive 200 customers. You sell your product, The Best of Big Band Wanna-be’s, for $10. So that translates to $2000.
Costs on the other hand include: domain registration ($9/year), web hosting (~$50/year), web design ($100 once) and of course that $99 PPC fee. But you are still making a profit.
A few caveats however. First, can you generate 20,000 visitors to your site? Next, will 200 people buy your product for $10? Can you get that keyword for $.05/click? If you are actively promoting both your band and your web site you probably could generate the traffic and if you brainstorm enough you can think of keywords potential customers might use (Overture has keyword lists which detail what words were used each month along with companies who have purchased keywords, how much they bought the word for, etc.).
Altnet utilizes a similar keyword scheme called TopSearch. I found a translation to their poorly worded commentary used in their slide shows: Content owners can self-publish their content to the Kazaa Media Desktop by paying fees of $99 and up to Altnet. The content creators can place whatever restrictions they prefer on the use of the copyrighted work using the Altnet software, and can ensure that their works are placed at the top of user searches by buying placement through Altnet's TopSearch. The TopSearch applet interfaces to the Kazaa desktop and places the approved searches on top of other, non-copyrighted files.
The same questions apply here as the Overture scenario: Is there an audience for your product? Are they willing to purchase your product? Additionally you should ask yourself: what is the air-speed velocity of an unladen swallow?
Fortunately it seems that there are at least individuals willing to pay for copy-protected products off of Kazaa – Altnet is reporting that approximately 18 million ‘copy-protected’ products have been sold (I assume in the past year as that is how long the service has been available for).
Conclusions
Looking at both the Overture and Altnet solution it appears that with either one you will need a website (or a blog). As far as which system will offer a better conversion ratio, that depends on your product. If you are trying to sell a video or song I would personally go with Altnet (Kazaa), as many more potential clients with disposable incomes use this venue (of course it also depends on what genre your video or song is, if it’s Oldies or music from the Rat Pack, you might not have an audience left that is still alive – aside from me).
By optimizing your website properly, it could appear higher in search engines thus alleviating the need to use PayPer Click schemes from Overture or Google. Assuming you do that you can focus your advertising energies with Altnet.
I personally would like to know more as to how Altnet has worked out DRM technology for software, documents and images. I understand how they can prevent reproduction of music and videos, but the other three seem a bit more difficult, especially documents and software.
If you are uneasy about using Altnet at first, try a ‘free’ alternative built into Kazaa called Kreate. This allows you to customize the keywords in files that you are sharing. Once you have renamed your files (ex: Big Band Music can use keywords like – jazz, Frank Sinatra, Sammy Davis, rat pack, etc.) you can see just how popular your file is (you can see who is downloading and what they are downloading from you). If you find that your files are indeed very popular then trying out the Altnet solution might prove to be a successful strategy.
If you try out any of the above strategies, whether it is TextAds, Altnet or Kreate, feel free to keep me informed on their progress and successes.
Posted by Tim at April 26, 2003 05:45 AM | TrackBackHey, I like the rat pack . . .
Posted by: Matt at April 26, 2003 07:30 AM