{"id":3732,"date":"2011-01-30T08:11:46","date_gmt":"2011-01-30T16:11:46","guid":{"rendered":"http:\/\/lefsetz.com\/wordpress\/?p=3732"},"modified":"2011-01-30T08:11:46","modified_gmt":"2011-01-30T16:11:46","slug":"problems","status":"publish","type":"post","link":"https:\/\/lefsetz.com\/wordpress\/2011\/01\/30\/problems\/","title":{"rendered":"Problems"},"content":{"rendered":"
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Q: What’s your best tip for other entrepreneurs?<\/p>\n

A: It’s not about starting a business. It’s about solving problems. That’s what being an entrepreneur is. Find a problem that there’s a better way to solve. Get a vision of how it could work better, and stick with it.<\/p>\n

Ron Shaich, Chairman of Panera Bread, in the "Wall Street Journal"<\/a><\/div>\n<\/blockquote>\n

This is why all those online music startups failed, you know the ones that were going to revolutionize distribution, they didn’t know who their customer was!\u00c2\u00a0 It wasn’t the music listener, but the major labels and publishers.\u00c2\u00a0 And their problem wasn’t easy access or availability, it was revenue replacement.\u00c2\u00a0 Unless you can convince rights holders they’re going to make a ton of money with your online idea, it’s a nonstarter, they just won’t license it.\u00c2\u00a0 Doesn’t matter that you’re arguing about an inevitable future, how much easier it will be for consumers, it comes down to cold hard cash.\u00c2\u00a0 The labels lost it and they need it. Can you solve that problem?<\/p>\n

Kind of like Ticketmaster.\u00c2\u00a0 If you can find a way to sell tickets to consumers more cheaply, great.\u00c2\u00a0 But your site better not work worse than Ticketmaster’s, then you’re going in the wrong direction.\u00c2\u00a0 This doomed Live Nation’s ticketing efforts.\u00c2\u00a0 The system didn’t work upon launch.\u00c2\u00a0 And no matter what improvements were made, public perception was that LN’s system didn’t work.\u00c2\u00a0 And once again, we’ve got an issue of rights.\u00c2\u00a0 Buildings and promoters are less worried about end consumer experience than cold cash.\u00c2\u00a0 They’re not sacrificing profits in order to make the consumer happy.\u00c2\u00a0 Without profits, they’re not in business.\u00c2\u00a0 And they’re greedy, just like the acts.\u00c2\u00a0 That’s what the Ticketmaster fees are all about, they’re hidden profit centers for the acts and promoters and venues.\u00c2\u00a0 They don’t have a problem with Ticketmaster, you do!<\/p>\n

And now we know why Amazon’s music efforts are a nonstarter.\u00c2\u00a0 The public did not have a problem with iTunes.\u00c2\u00a0 And sure, Amazon may blow out music at a loss, but how do you get it into iTunes and on your iPod?\u00c2\u00a0 People buy from iTunes as insurance, of a hassle-free experience.\u00c2\u00a0 Come on, everyone hates tech trouble.\u00c2\u00a0 Who do you call?\u00c2\u00a0 Who do you e-mail?\u00c2\u00a0 Actually, at this point it’s clear you’re on your own.\u00c2\u00a0 You’ve got to do online research.\u00c2\u00a0 Unless you’re an Apple customer.\u00c2\u00a0 Then you can go to the Genius Bar.\u00c2\u00a0 That’s a problem Apple solved.\u00c2\u00a0 You buy their products and you’ve got someone who’ll help you.\u00c2\u00a0 Ever try to get help at Amazon?<\/p>\n

And Sirius XM has solved the problem of endless radio commercials.\u00c2\u00a0 But it hasn’t solved the problem that their stations sound just like the dreaded terrestrial ones, just without ads.\u00c2\u00a0 That’s half a solution.\u00c2\u00a0 Which is why subscriptions have stalled.\u00c2\u00a0 Twenty million people will pay to get rid of commercials.\u00c2\u00a0 But in order to get everyone to pay, you’ve got to be offering a service that’s different from what’s available for free.<\/p>\n

And speaking of free, Pandora’s successful because it solves the filter problem.\u00c2\u00a0 What do I listen to?\u00c2\u00a0 There’s a plethora of music online, where do I start?\u00c2\u00a0 By plugging in the name of your favorite act in Pandora.\u00c2\u00a0 Build a better mousetrap than Pandora, give better recommendations and you can kill the site.\u00c2\u00a0 Only one venture in every category succeeds online.\u00c2\u00a0 Barnes & Noble has no traction selling books online and Borders is barely in business, everyone just goes to Amazon.\u00c2\u00a0 Amazon sells books very well. They were there first and got it right, like Apple did in music.<\/p>\n

In order for the aforementioned Live Nation to be successful, it’s got to solve the problems of acts.\u00c2\u00a0 Which is they want to make more money without giving the appearance of screwing their fans.\u00c2\u00a0 Sure, LN overpaid for years, but now they’re in trouble if they want to pay less.\u00c2\u00a0 Because the acts are not loyal to LN, they’re loyal to money.\u00c2\u00a0 In order to triumph, LN’s got to not only pay more for gigs, but prove to acts that they can upsell ticket buyers on additional merchandise.\u00c2\u00a0 We keep hearing about this, but it’s yet to happen.\u00c2\u00a0 So, right now, unless an act wants to play in the sheds, it’s open season in the concert business.\u00c2\u00a0 If you’re willing to pay, you can promote the act.\u00c2\u00a0 Because there’s just nothing special to LN.\u00c2\u00a0 Used to be they paid more, but with that debt…<\/p>\n

And the problem acts have is exposure and getting paid.\u00c2\u00a0 Which is why the major labels are faltering.\u00c2\u00a0 Because the majors can only expose mainstream\/Top Forty fare and they don’t want to pay more, they want to pay less for more rights.\u00c2\u00a0 That’s not an enticing deal.\u00c2\u00a0 Certainly not if you’re not making Top Forty music.\u00c2\u00a0 Unless the majors find a way to sell music in categories other than Top Forty, unless they provide more services for their 360 deals, they’re screwed.<\/p>\n

And indie retail will continue to die, because most people don’t have a problem with online music.\u00c2\u00a0 Sorry, it’s the truth.<\/p>\n

And new venues will always have an uphill climb, because people don’t go for the building, but the show.\u00c2\u00a0 The problem is getting tickets to see the desirable acts.\u00c2\u00a0 StubHub fixed this problem, as did the scalpers, that’s why they’re triumphing.\u00c2\u00a0 The acts have platinum packages, there’s talk of airplane pricing, which no one likes when flying, I don’t know why they’d like it in concert tickets, the only solution is for the act to truly control the ticket by going paperless.\u00c2\u00a0 But that eliminates shenanigans…\u00c2\u00a0 But if you’re in it for the long haul, it’s the only way to go.\u00c2\u00a0 Then again, if you’re a flash in the pan, your problem is how can you make as much money as possible as quickly as possible.\u00c2\u00a0 Don’t worry about screwing your fans, they won’t care about you two years from now anyway.<\/p>\n

And if you’re making music…\u00c2\u00a0 The consumer’s problem is not that he can’t find enough beat-driven Top Forty music.\u00c2\u00a0 It’s that he can’t find anything new and innovative that he will pledge allegiance to.\u00c2\u00a0 Unless you can make this, you’re on a long hard slog.<\/p>\n

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Q: What’s your best tip for other entrepreneurs? A: It’s not about starting a business. It’s about solving problems. That’s what being an entrepreneur is. Find a problem that there’s a better way to solve. Get a vision of how it could work better, and stick with it. Ron Shaich, Chairman of Panera Bread, in […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[2],"tags":[],"class_list":["post-3732","post","type-post","status-publish","format-standard","hentry","category-music-business"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/s96vPs-problems","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/3732","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/comments?post=3732"}],"version-history":[{"count":1,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/3732\/revisions"}],"predecessor-version":[{"id":3733,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/3732\/revisions\/3733"}],"wp:attachment":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/media?parent=3732"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/categories?post=3732"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/tags?post=3732"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}