Week 4: Business Models and the New Era of Competition

This week we looked at business models on the web.

"Business Models on the Web"

• Ambiguity around business models although they are a critical aspect of a business.


• IP becoming a form of protection around a business model in tech... difficult to tell what is old versus new in tech form


• Multiple models available: brokerage, advertising, infomediary, merchant, manufacturer, affiliate, community, subscription, utility

"Gil and Frank Discuss Business Models"

• Subscription based services such as WSJ offering online and print in combination. This is successful because it provides multiple mediums and tieiring of pricing for consumers. It also has a very targeted customer base which aids in its success.


• iTunes was used as an example of a micropayment model since it enables people to buy single songs instead of having to buy a full album


• YouTube was mentioned to discuss some failures to monetize due to its inability to successfully target ads to the videos being watched. This should improve over time.


• Myspace mentioned as a social media platform leveraged to turn social media and music into sales revenue for record companies.

I want to mention that the MySapce example needs to be updated given the recent divestiture announcement from News Corp followed by the recent bid for it by independent investment group that includes Justin Timberlake (musician). I am curious to see how the new business model will change with the new owners.