Reverb® – A framework for monetizing digital content
The sorry state of the music industry is pretty obvious today. The business used to depend on sales of albums and singles to create billions in revenue. The idea of getting this content for free exploded into cultural phenomenon with Napster and continues in the torrent era.
Most experts pin the problem on the idea that media scarcity is dead. But from the perspective of my first startup, a company that made a good-sized business delivering innovation and usability to big clients, the problem looked more like an industry that had lost touch with fans.
File sharing, even Napster, is inherently geeky. Torrents require knowledge about routers, port forwarding, and IP address URLs – not to mention a certain situation ethic that makes it feel OK to take something that sort of feels like stealing. But what made Napster worth diving into was the surprise and delight of getting a match for almost any song you wanted to find. And once you connected peer-to-peer with the user who had your song, you could browse the rest of their collection which almost always had additional nuggets of goodness tempting you to download.
The idea of Reverb® is to let brands help the music industry make downloading easy while keeping it free. The Reverb architecture embeds suppressible ads in the digital content. People who play the free content get a DJ-style talk-over that’s no more than 10-15 seconds long somewhere during the playback.
A simple Reverb API allows any desktop, mobile or digital player to remove this ad on the fly – almost like noise-canceling headphones. An advertiser might want to suppress the audible ad in exchange for you downloading a branded player for your desktop. Or maybe you paid for the content and iTunes or Windows Media Player would remove the ad on-the-fly.
We piloted Reverb with two major record labels in the UK. Reverb was neck-and-neck as the cornerstone of a major, multi-million dollar online rollout for The Coca-Cola Company that ultimately was awarded to the makers of Habbo Hotel for their virtual worlds.
Most of all, Reverb faced the challenge that only a superstar technical CEO could battle the entrenched music industry. Steve Jobs took up the challenge and iTunes/iPods have been nothing short of a cultural transformation. I’m not embarrassed to say that I’m pretty good as a CEO. But I’m no Steve Jobs. Not yet, anyway.