How Napster Changed the Education Industry

May 24, 2010 - PRLog -- How Napster Changed the Education Industry
By Anthony Cipollaro

Monday, May 24, 2010 2:22 PM

ORLANDO, FL – And we thought the Napster Era was over. We were wrong. Though different than the way Napster used to allow the free distribution of music, the digital revolution allows the free flow and sharing of data. When an item becomes digital, it instantly becomes subject of public view and drives free-distribution. Be it an embarrassing photograph, one’s favorite song, or maybe the latest Twitter update, once it’s on the internet it could potentially go anywhere. While Napster is now regulated and has very specific parameters for operation, the internet still remains an untamed forum, sometimes causing a previously “stable” pay-for-content-market to lose its legs.

Recently, the digital content market has increasingly become the focus of strategic corporate planning, forcing a “revenue model revolution” to keep up with this trend. Different companies have begun looking for a competitive advantage on this digital landscape. It’s no surprise the growing digital content industry presents an attractive business opportunity for a number of companies in different market sectors, especially those involved in music, games, digital product markets, information, and evidently…education.

This is because digital market products have a distinct advantage over physical market products. Digital markets typically have lower entry costs, allowing companies to efficiently compete by utilizing less start-up capital in developing and maintaining their business. Also, in a digital market, prices change easily. This often leads to high price flexibility and lower prices for consumers, which makes the products attractive and affordable for the majority of visitors – making the industry attractive to entrepreneurs, and angel investors. Furthermore, with digital markets comes digital marketing. Digital Marketing allows a business to reach customers more effectively by “promoting products and services by using database-driven online distribution channels to reach consumers in a timely, relevant, personal and cost-effective manner,” says expert Jared Reitzin1.

The digital product market is growing.  But as the market has grown, so has the proliferation of file sharing technology. Here lies the inherent disadvantage of a digital market. If there is one consumer who can access the product, there is one consumer who can potentially share the product with other possible customers. Consider the Casebriefs LLC, case study.

Released in 1995, Casebriefs™ is an educational digital products series, which provides digital case briefs distributed over the internet. Casebriefs are basically Cliff Notes, but for law students. The series has over 60 published titles consisting of over 50,000 authored pages that it owns into perpetuity and license free. All content featured on Casebriefs is “best-of-breed,” meaning it’s been written by either lawyers or law professionals. Because of this, law students trust the high quality content found on Casebriefs.    

Previously, students would log in to the Casebriefs website, locate their title, and enter their credit card information to download their case brief title in an e-book format. But thanks to the digital e-book format, fewer and fewer law students were paying for content. The pre-regulated Napster-era style of music proliferation had expanded to text based content. Though visits to the Casebriefs website were still solid in number, revenues declined because one consumer could purchase the content and easily pass it to other consumers for free.

Before a well-executed and thought out plan to change business models, Casebriefs LLC was losing favor due to the proliferation of file sharing technology. After reconsidering the business model, the Casebriefs team decided on a different direction. Rather than a paid for content model, a “Free content,” model would be utilized. This “Free content,” model would be advertiser supported, with income generated by the aggressive solicitation of advertisers identified for the website.

To be clear, there is a fine line between what happened during the illegal Napster-era of free music downloads and what eCaseBriefs is doing today by providing their case-brief content for free. When asked about Napster’s free-content distribution model, Mr. David Gray, CEO and director of sales for eCasebriefs.com noted:

“Napster was an enabler of copy written, paid for, content to be passed around for free thus avoiding any monetary purchase of the copy written work product.  Casebriefs on the other hand is allowing its copy written content to be used for free – the publisher is allowing its content to be passed around and used in an open environment.  The two have very different business models.”

It is Mr. Gray’s goal to make eCasebriefs.com the Cliff Notes for law students. He is determined to be, in his words “The leading publisher and distributor of the highest quality academic study materials and general information for the US law student market.” And currently, he’s in a position to do just that. Mr. Gray has more than doubled the number of advertisers on www.ecasebriefs.com – which range from law companies, to law schools, and even study abroad programs in the education field. He is also opening the doors to new investors for the company to conquer the unexploited market. See more information about this here.

The brief 21 year history of the internet has seen unbelievable exponential growth, a rapidly changing landscape, and some of the most innovative technology ever created by mankind. The digital content industry, which grew rapidly in the late 90’s, experienced a major slowdown in pay for content revenue due to digital content sharing. Casebriefs is a company which has since rebounded by providing free content, and utilizing an advertiser supported business model. There is no doubt that the “Napster effect” is being felt by slow reactants to the industry’s behavior. eCasebriefs, however, is quickly reaping the fruits of its labor – an on time strategic shift.

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NewGate Capital Partners is a Mergers and Acquisitions boutique firm headquartered in Central Florida. We specialize in strategic marketing consulting services and provide confidential business brokering, customized research services.