Long Tail

I read an interesting take on Piracy this morning by Chris Anderson on the Long Tail blog.

He argues that there may actually be a benefit from a certain level of piracy for IP companies and that zero piracy is not necessarily conducive to maximum margin contribution.

I don't disagree, but I don't think this is any real surprise either. The issue of course is to keep it in balance. Back in the '90's I seem to remember that the major music labels anticipated a level of piracy of between 2.5 and 7.5% of sales because of illegal manufacturing of products in China. The problem now is that the percentage of pirated music products that are sold has risen to north of 30% apparently. This is probably more a function of price than of a natural growth of pirates per se.

At the same time, I just got finished reading a lengthy article from the New York Times about the provision of mercenaries or private security foreces to companies doing business in Iraq. This story is ironically about exactly the reverse. Its about the fact that private armies that cost considerably more than national armies are now becoming de rigeur all over the world.

I am really intrigued by these two totally disparate areas of activity that each are driving different cost issues for business, and ultimately for the consumer.

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