Is capitalism dead?
The stories this week are all about companies that claim to be capitalist. Are they? Or are they just profiteers and opportunists who no longer understand the meaning of capitalism?
In the latest effort to establish an e-book lending library, Amazon is putting forward their plan. It’s different from what Google tried, and definitely different from what a group of research libraries has done (and those libraries are currently being sued by authors).
Will Amazon be successful? The answer lies in whether Amazon chooses to be capitalist and stick with their origins, or abandon capitalism for pure opportunism. When Cornelius Vanderbilt moved from steamships to railroads, there’s no question he did it because it looked profitable. There’s also no question that the basis of the profit was developing a reliable transportation system across land for business owners and passengers.
Vanderbilt used capital (and capitalism) to produce the needed transportation systems, and got wealthy in the process.
Is Amazon pursuing an e-book lending program because they want to help authors spread their ideas, make our live better, and benefit society? Or are they doing it simply to pursue profits – a.k.a. profiteering. (The original name for pirates was profiteers.)
Google has purchased Zagat – the restaurant review site.
This fits with Google’s pursuit of dollars being spent by small business on local advertising. Having a site such as Zagat is one more way for Google to service this “newly discovered” market. But will Google serve, or merely exploit?
The biggest dispute I have with purveyors of space advertising – which is one of the things Google plans to do with Zagat – is that they know nothing about, and often discourage, direct response marketing. For example, the Yellow Pages has attained renown for discouraging business owners from tracking the response rate to their ads.
So what is Google going to do? They’re in an excellent position to create a self-qualifying ascension model for business owners. Those who want to track their return-on-investment can proceed up the ascension model, and those who see no need to track response rates can stay at the bottom. Putting this into place gives Google additional revenue streams at the same time that they actively help local businesses become stronger and more profitable.
This is capitalism.
If all Google does is expand the review categories available through Zagat, then use the additional pages to sell advertising space, then they’re profiteers – plain and simple. Personally, I vote for the capitalist approach and am willing to roll up my sleeves and help. Is Google up for the challenge?
And we wrap up the show this week with a story about cable television going mobile. That’s right, they’re getting in on the mobile market, too. And they’re doing it well.
So far, DirecTV, Dish Network, Comcast, Cablevision, Cox, Verizon FiOS, and AT&T U-verse are all in on the project. It gives current subscribers access to all their TV channels through mobile devices – tablets, smart phones, laptops.
For an industry that’s suffering because viewers are being drawn away by the internet and mobile computing, this is an incredibly well conceived idea. One that the record companies could have profited from, and one that book publishers should pay attention to. (Think Amazon and the explosive growth happening in self-publishing and print-on-demand services.)
The cable companies have been working on this for two years. It shows signs of being capitalist in nature – they have put up the capital, are taking the risk, and expect the payoff to come from regaining lost viewers. Compare that to Amazon wanting to take the existing concept of the lending library – a free, public service – and convert it to a subscription based service so they can increase their profits.
You be the judge. Who are the capitalists and who are the profiteers? Listen to this week’s episode and join the conversation on my blog at www.TheMarketingSpotlight.com