Umair Haque / Bubblegeneration
umair haque  


Design principles for 21st century companies, markets, and economies. Foreword by Gary Hamel. Coming January 4th. Pre-order at Amazon.

Tuesday, September 21, 2004

Steven Levy on price competition in digital music:

"...But the labels should understand that the nature of the digital world rewards price cutting much more than in the physical world."

Actually, I think this is one time when Levy is dead wrong - the evidence from micropayments suggests that, if anything, the digital world does NOT reward price competition. There are various reasons for this; my favorite is that unbundling reduces value for consumers in markets with heterogeneous preferences.

Will prices come down? Yeah - because no one built a new business model. Is it good for anyone? Not really.

-- umair // 2:52 PM // 0 comments


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