For the past few weeks, I've been surfing the web and checking out new sites. Many seem to be an attempt to replace or imitate Napster - variations on file-sharing and downloading - but others show more imagination. They don't represent new ways of selling the same old things, but ways of creating new markets for new things. They are exciting because they put the power of institutions at the service of individuals.
Fairtunes.com, which came about as a result of Napster but is no clone, was started by a couple of Waterloo University kids in Canada. If you have listened to 'free' music on Napster (or elsewhere) and you'd like to make a voluntary contribution to the artist but don't know how, you can send it to Fairtunes, which will pass it on minus credit-card and direct processing fees. For what it's worth, the founders are contributing their time and other costs - not a sustainable business model, but a good way to start. It's not universally popular in the music industry, but I think it's a nice addition to the mix and it lets people act on their generous (or guilty) impulses. The take so far: about dollars 2,500.
Another approach is idealive.com, which helps artists collect money beforehand for projects they want to undertake. The idea is to create an informal exchange where artists and fans/investors can find each other. Most projects go through the funnel of established distribution channels, which weed out non-mainstream ideas, but, with idealive, the artists have some chance of finding their audiences and getting funding. This approach poses the question of how projects will make money, but at least some fans are more interested in seeing things happen than in collecting money afterwards.
Two issues: projects must be clear on whether their goal is to make art or to make money as well. And second, idealive.com will over time have to take on regulatory functions to verify the legitimacy of projects posted.
In a slightly different direction, there's ShareYourWorld.com, which lets individuals or small businesses post and sell digital photographs and videos. It's a giant photo bureau, where SYW describes the inventory in a richly indexed online catalogue and collects (small) fees for content providers. When I was a kid, my mother snapped a delightful photo of my brother and me, sitting on a gas station island enjoying a couple of Pepsis.
We had no idea how to get this picture to the Pepsi people; with ShareYourWorld we might have had a chance.
All these companies have great ideas, but should anyone invest in them?
There's a huge difference between an idea and a self-sustaining business.
The challenge is to implement ideas well enough to survive as a business.
That means figuring out how to charge, provide customer support and manage quality control.
When you start a business open to all-comers, you will encounter people trying to abuse the system. How do you create your own regulatory regime, as eBay has had to do? As companies gain visibility, they gain competitors.
They will have to keep on being creative, expanding their services, raising their quality and probably lowering their prices. But they all send an encouraging message: on the internet, the entrepreneurs are often as creative as the artists.