This post goes over Step2's 20,000 character limit. Please see the comments section for the second half.

INTRODUCTION



I once rented a car for work and had an unpleasant experience. When I returned the car, I thought to myself, "I'm never renting from them again." After sitting on it for a day, I realized conducting my own silent protest wasn't going to help me or the rental agency. So later that day, I called their corporate headquarters and told my story to the VP of customer relations. More importantly, I told him what they did wrong and what kind of experience I expect as a customer if he wants my future business.



I would like all the content creators reading this to view this post as though you are the car rental agency. I am a dissatisfied customer who may never buy from you again unless you get your act together. I normally wouldn't waste my time explaining all this, but the content creators on Step2 certainly seem to be going in the right direction so I'm hoping this information will help.



This post isn't my attempt at a debate. You won't hear any mention of theft versus copying, exposure versus lost sales or right versus wrong. All I want to do is give you real-life insight from the file-sharing world. I want to hold your hand and show you how I decide what to buy and what my motivation is to pirate. I will use the terms pirate, download and file-sharing interchangeably throughout this post but they all mean the same thing: to download your content for free.



Some people will read this and think, "I don't care what this guy says, internet piracy is damaging." For those people, I ask you to skip the rest of this post and jump to the bottom section titled, 'In Closing.'



Some of you won't read this entire post and it won't hurt my feelings. You won't understand your customers and we won't buy your content. And don't read this hoping to find out why people download your content in the hopes that you can stop it in the future. You cannot stop file-sharing. It would be like trying to stop people from using electricity. People who have already paid for your content will also be some of the ones who download it. And they'll share it with others.



CHAPTER 1



I'm probably in your demographic. Male, mid-thirties, no children and living in Los Angeles. I'm also an unashamed downloader. I have many albums, many movies and many games that I share with friends and strangers. Most of which I've downloaded for free. Surprisingly, I also have many albums, many movies and many games that I have purchased, that I also share with friends and strangers. How did this happen?



When I was 16 and got my first job, I had nothing else to spend my money on but movies, music and games. I amassed a decent collection those first couple of years. As I grew older, I discovered I had purchased a lot of garbage. I was buying based on hype and I hated myself for it. By the time I was 21, I had stopped buying everything. I only played video games at my friend's houses and I only rented movies because at $1 a pop, I didn't feel ripped off if the movie sucked. I stopped buying music completely because it was hard to justify gambling $10 per CD. And trust me, that's what it all felt like, gambling.



I was in my twenties when Napster appeared and I still remember the day I heard about it. I had just started converting my CD collection over to mp3 and Napster saved me tons of time. After I downloaded the stuff I had already purchased, I began checking out new content. I quickly found several new acts that I liked and started downloading more new acts. It was addicting. When Napster was finally shut down, the file sharing industry had exploded. All these new services were catering to all types of media. Internet speeds were increasing. I had to buy larger hard drives to store everything.



I noticed something peculiar though. I was buying music CDs again. And I was going to the movies again. Same thing with video games and movie DVDs. It definitely started out slowly, but I can say with certainty, I spend significantly more now on entertainment than I ever did before I started downloading. And my story is not unique, many file-sharers will tell you the same thing.



Here's one thing a lot of content creators seem to not understand: I'm downloading your content because I'm interested in it. I'm not downloading it to try and stick it to you, I don't even know you. It's up to you to make the content compelling enough for me to buy it. I might not buy this one since I already have it, but if I become a fan, I'll likely buy the next thing you put out. Many content creators will think this is unfair. "I created the content, I get to control distribution and formats." No, you are wrong.



It used to be that way. If the record label said, "We are releasing this album in New York on the 10th and in Los Angeles on the 20th and only on cassette" then I had no option but to deal with it. Now, I don't care when, where or how you release it. If I want it, I'll get it. This is exactly what the internet did: it took control away from you and gave it to me. If you don't like it, then sit in your basement and create your content for your love of the craft instead of for profit. But if you want to sell it to me, you're doing it my way.



I will still give you my money if you make me happy. The sad part is there are still times where I would gladly pay for something but the content creator has left me no choice but to download it. Techdirt seems to post a story like that once a week. I'm not going to deny myself the enjoyment of your creation just because you haven't figured out how to collect.



How about this, I'll continue to download your stuff and have a blast. When you finally catch up, I'll buy your new stuff if the price is right. Maybe if you're lucky, I'll tell one of my non-techy friends about your movie or book and he'll buy the physical copy because he can't figure out how to download it. And I'm not going to feel bad about any of this because according to my credit card statements, I spend about $2,500 a year on entertainment. A $200 per month entertainment habit that is unequivocally fueled by file-sharing. Yes, I download more than $200 worth of content a month, but if you take away my file-sharing, you'll lose the money I'm putting into the market. That was definitively proven during my pre-Napster days.



CHAPTER 2



So let's approach this from a different angle. How about we take a deeper look at why I pirate your content and how you can extract money from me. But before I discuss how to get me to buy your album or book, let's go over a few things that are common to all types of media.



A. I have a lot of things competing for my entertainment dollars. You can't expect me to buy your content sight unseen when your competition has already proven to me that they have a quality product. You have to show me what you've got.



B. Get a handle on your pricing for digital media. Look, we understand why a paperback costs $7. You have to buy paper, glue and ink. It has to be written, edited, printed, shipped and stocked. And each of those people wants to cover their costs and make a profit. But when you write an ebook, and all you have to do is hit 'copy' to make another sale, you have no business charging $7 each. Remember before when I said I'm not downloading to try and stick it to you? In a situation like this, I'm downloading because you're trying to stick it to me.



C. Don't try and restrict when or how I can purchase your content. The internet has made the world a single, always-open marketplace. Either your product is for sale or it's not. Don't try and tell me I can't buy the DVD in the United States because Europe gets the exclusive rights for the first 2 months. I'm just going to download it and probably forget to buy it.



D. Stop trying to dictate how I can consume your content. This includes formats, media types and playback restrictions. I don't care if you think it's only real music if it's played on vinyl. I want it in mp3 format on my phone so I can listen to it at work. I don't care if you think a Hulu subscription is only valid for a computer. I want to watch the content on my television. I don't care if you think I should have to buy a digital copy separately from the DVD. I'm going to buy the DVD and create my own digital copy. And if you try to inject DRM to prevent me from doing what I want, you will have ruined your reputation and I will never buy from you again. Instead, I will only download your content for free. The question isn't whether I'll get your content in the format I want, the question is will you get my money in exchange for it? Your cooperation helps.



CHAPTER 3



Music. If you want me to buy your music, I need to be able to hear it first. Even if you're trying to sell for profit, you should find a way to get mp3 versions of your music on file-sharing sites. Now I know some of you are going to tell me that since you're selling your songs on Amazon or iTunes then I can hear 30-second preview clips and I have no reason to pirate. Nonsense.



Most music listening is not done sitting in front of the computer clicking "Play Preview," waiting 30-seconds, clicking "Play Preview," waiting 30-seconds, etc. We all listen to music while driving in the car, working out, partying or browsing the internet. I can download your entire full-length album in unrestricted mp3 format in less time than you can listen to one 30-second preview. You're not going to sell me anything by forcing me to sit on one website, going click click click and only getting small snippets of your music. What you are going to do is make me not care about your content.



One day I saw the name of an artist I had never heard of before. He had released three albums but hadn't made it big. I downloaded all of his albums and found out I liked a good portion of his stuff. A few months later on Amazon, I noticed he had a new digital album out. I purchased it without listening to a single preview clip. I also told several of my friends about him. I don't know if they bought anything, but that's not the point. The point is he got my money. Specifically because I was able to download his older albums and the stuff he was selling was DRM-free.



Now some of you are sitting there thinking, "Hey, you now have four albums but only paid for one. That artist lost three sales!" Obviously you aren't paying attention. Your facts are accurate but your conclusion is erroneous. No sales were lost. There were only two possible outcomes, either there would be no downloads and no sales or there would be three downloads and one sale. Which would you rather have?



Don't try to gouge me either. We customers have come to expect physical CDs to cost $10-$12. You better be in that range if you want me to buy. You've got no business selling your album for $25, you're just going to alienate me and drive me to download it instead, even if you're a big-name artist. I'm also turned off by the current mp3 market pricing of $1 per song and $9 per album. It's digital, I should be saving more money by not buying the physical product. I think $0.25-$0.50 per song and $3-$5 per mp3 album is my price range. You may think I'm insane, but luckily I'm not confined to your pricing structure, I've got other options.



Those other options also mean I'm not going to entertain your thoughts of using special playback mechanisms to enjoy your music. I will not install some special software just to play your CD. I will not install iTunes. I will not use Windows Media Player. I'm going to convert your CD to flac and mp3 and put it on any device I want. I want my music free of DRM and free of licensing restrictions for personal use. Another thing I'm not going to tolerate is when you offer special tracks through one particular retailer. Like when you make an album with 15 songs and then offer a special 16th song that is only available if you buy from Walmart. I'm definitely going to pirate that 16th song and I'm going to consider pirating the whole thing. Do you want my money or not?



You want to know who's really going to get my money? The artists who wake up and realize they can sell me their newest physical CD for $20. And by paying $20 for it, they're going to give me unrestricted digital copies of this album, and all their other albums. You know who's going to be hurt the most by that? You. Instead of me paying $10 for their CD and $10 for your CD, I'm going to give them the $20 and pirate your album. And if you are going to sell your album digitally, I would really appreciate liner notes. You can offer me a pdf file or simply link me to a webpage, but stop ignoring this valuable info. And make sure you have a website that details everything you've released and what you're working on. There's nothing more frustrating than finding a new obscure artist you like who only has a dormant Myspace music page.



Keeping your head in the sand will also drive me to download. The Beatles fiasco when they held out allowing their music to be sold digitally is a prime example. The band, the heirs and the label all had their idiotic hands in the mix jockeying for position. Since they had no respect for their customers, I decided to downloaded every album simply because I could. When they finally did release digitally, I wanted no part of it.



I have a colleague who has been working with his brother on releasing an album. They are terrified of the internet and it shows. When I first asked to hear some of their music, I was told the only way to hear anything was to come by their studio. Excuse me? Come by your studio? Are you nuts? Barring that, they told me to go see him play live. I'm not a fan of concerts so I doubt I'd go even if it was free, but they wanted me to buy my own tickets. They finally put a few tracks on YouTube but they're still nowhere near getting me to reach for my wallet.



CHAPTER 4



Books, comics and magazines. Some will say it's not a real book or comic if you can't hold it, turn the pages and smell the paper. That's just elitist nonsense. Anyone who has paid attention to the industry knows there is a demand for digital literature and as a producer, you need to give your customers what they want. There is a market for both physical and digital and you better make sure you have both available. Sure, someone huge like Ray Bradbury can hold his breath and stomp his feet and say "No ebooks!" But someone like you can't afford to ignore the market trends. And Ray Bradbury finally releasing ebooks was a non-event for us downloaders, all of his works were already available in ebook format on the pirate sites.



Just like with music, some of you will think that if you provide several preview chapters, I have no reason to pirate. And just like with music, you'd be wrong. Many times I've read sample chapters and then been disappointed by the entire book. Maybe it was your ending, or maybe it was the way you pulled something out of your ass in chapter 17 to rescue the girl. Either way, I'm not gambling anymore. Sure, some people might read those three chapters and think, "Hey, this is great, I'm going to buy this book." Me? I'll download it and read it if it's compelling. If I didn't like it, no harm, no foul. But if I did like it, one of two things are going to happen. One, I'm probably going to buy your next book so you should make sure you have a website where I can check up on what you're doing. Two, if I really liked this book, I'm already thinking about who else would like it. I'm going to buy the physical copy and give it to that person. I've probably purchased 10 books this year, yet I don't have a single one in my house because they've all been given away.



So if you want to generate a sale from me, you better make sure your book is available on the file-sharing sites. All of your competitors are already there so there is no reason you shouldn't be also. Additionally, if I buy your physical book, you should throw in a free digital copy. And if you offer digital copies, offer all the possible formats. If you only offer a pdf version, you aren't inconveniencing the pirate community. We can easily convert it to lit, mobi or epub. But what you are doing is potentially losing a sale to people like my mom. If she can't easily get it on her Nook, she's not going to bother with it.



I rarely buy hardcover so I'm going to skip offering a price opinion on it. As far as fiction goes, I expect to pay $6-$9 for a paperback and $3-$5 for a comic. For digital, ebooks should be $1-$3 and ecomics should be $1. Sure, I'll pay more than those prices if you're one of my favorites, but chances are you're not. Stop pricing your content like a diva.



If you've managed to coerce me to buy your current book, you're going to have to entice me if you want me to buy your older stuff (which should always be cheaper than your current stuff as a rule.) At the very least, I should get a discount on your older stuff for being a current customer. And I'm not talking a token 10% discount, make it something substantial like 50%-75% off. Or better yet, use the example I proposed in the music section. Sell me your current paperback for $12 and give me free digital copies of all five of your books. Treat me right, and I'll pay full price for whatever you put out next.



Even though I'm big on downloading, I still subscribe to four print magazines and one daily newspaper. Why would I do that when everything in those old-timey printed things is available for free online? Portability. I'm not paying for the content, I'm paying for the service of collecting all those articles in one easy to carry format and having it delivered to my porch. Now I can take this easily mobile collection with me anywhere I go.



[continued in comments section]