The Increasing Concern of Online Music Privacy

With the ease that users can download free music and share files through the internet and other technologies, online music piracy has become a major concern around the world. Even after the government shut down some of the websites such as Napster and LimeWire, many more were created. This makes it really hard to track and stop online music piracy and copyright infringement. Knowing that you could listen to music for free, people are more likely to download music from these sites rather than pay about $15 - $20 for a single CD.

According to RIAA (Recording Industry Association of America), online music piracy causes $12.5 billion in economic losses every year. I agree that online music privacy negatively affects well known recording artists and big music companies, especially in terms of their bottom line. However, it benefits new musicians by giving them a chance to put their name out there so that people are more familiar with their music.  

In order to combat this issue of online privacy, RIAA are using anti-piracy efforts such as educational programs (especially directed to high school and college students), working with law enforcement, and creating legal methods to listen music. Their goal is to control piracy on the internet and they hope that the increased number of lawsuits will discourage people to download music illegally. They plan to accomplish this by educating people about the legal ways to listen to music online through download and subscription services, internet radio webcasting, and legitimate peer-to-peer (P2P) services.   

But can online piracy really be stopped? People around the world are so used to downloading music and sharing files illegally through websites. And even if the government shuts down these websites, many more are created in its place. So this becomes really hard for the government to keep up with technology.

Link: RIAA. “Piracy: online and on the street.” http://www.riaa.com/physicalpiracy.php

The F.T.C. Online Privacy Report Recommends “Do Not Track” Option

The Federal Trade Commission (F.T.C.) recently issued an online privacy report earlier this month that seeks to protect the privacy rights of consumers. The report is a response to the ineffective current industry policies of protecting one’s privacy through self-regulation. Instead of having consumers consent to long legal disclosures, which they don’t read anyway, the report aims to provide consumers with privacy protection and thus reducing their liability.

In this report, the F.T.C. recommends companies to have a “privacy by design” approach by building privacy protections into their everyday business practices. “Such protections include reasonable security for consumer data, limited collection and retention of such data, and reasonable procedures to promote data accuracy.” What exactly is reasonable? This is a very ambiguous term and it will be very unclear as to what would be considered legal versus illegal. I know that it’s very hard to explicitly state each and every situation that would apply to this “reasonableness,” but this would create lots of confusion. One thing is for sure, that consumers would be better off than they were once before.

The report also discusses the use of a “Do Not Track” button, which would allow consumers the choice of being tracked and the ability to block advertisers from collecting their information to be used for target advertising. This would be achieved by having a cookie placed on the consumer’s browser indicating their option of being tracked or not. However, according to the New York Times article, these opt-out cookies are hard to manage and work poorly because “they often get deleted when people try to clear out advertiser cookies.”

So how would this new legislation affect both consumers and companies? Consumers will have their privacy protected and will have reduced amount of advertisements and spams. The company’s marketers and advertisers, on the other hand, spend a lot of time and money to research consumer trends and then have special advertising for a specific target market. Companies will be ineffective and will have to eliminate personalized advertisements. In addition, if ads are reduced, many websites that primarily depend on advertising revenue will suffer as a result.

Companies such as Microsoft, Mozilla, and Google have already agreed to work with the F.T.C. in order to provide consumers with more privacy protection. It will be interesting to see whether this would actually work once these recommendations are put into use.

Sources:

Federal Trade Commission. “FTC Staff Issues Privacy Report Offers Framework for Consumers, Businesses, and Policymakers.” http://www.ftc.gov/opa/2010/12/privacyreport.shtm

Richmond, Riva. “What if There Was a Do-Not-Track List for Online Browsing?” http://gadgetwise.blogs.nytimes.com/2010/12/02/what-if-there-was-a-do-not-track-list-for-online-browsing/?scp=4&sq=ftc%20issues%20privacy%20report&st=cse

Online Social Media: A Necessary Tool for Business Success

Social CRM has increasingly gained momentum and has changed the way people and businesses communicate. Companies are taking advantage of social media and social networking for marketing and increasing their customer service level. Social media sites such as Facebook, Twitter, LinkedIn, YouTube and Myspace, allow companies to not only attract new customers to their products or services, but also maintain relationships with existing customers.

However, according to a Forbes article by Jeremiah Owyang, companies face a major problem with using social media. Through social media sites, information is communicated in a rapid amount of time and therefore marketers have a hard time keeping up with the information and responding to consumers. Simply hiring more employees is not the answer to this problem.

To respond to this problem, a new trend is emerging of integrating traditional CRM systems such as SAP, salesforce.com, and other software with social media sites. This allows companies to easily track the discussions on Facebook or Twitter by identifying keywords that might show that customers are happy or dissatisfied with a particular product or even show prospective customers that are interested in making a purchase. Companies are then better able to respond to customer needs in a faster amount of time.

Generally, when customers have a problem with a product, rather than calling the company’s customer support line, they would complain on the social media sites. The news is shared with millions of people, which gives the company a negative reputation and thus affects consumer purchase decisions in a negative way. According to a New York Times article, Comcast tackles this issue by using Salesforce to search for particular keywords in Twitter. The company then responds with a Twitter message to resolve the particular problem at hand. Many companies are taking advantage of the benefits offered by Salesforce to respond to customer needs in the online social media.

Social CRM has become a necessary tool for a company to succeed. Customers also use these social media sites to inquire about a company’s reputation and read product reviews before making a purchase. Therefore, it’s very important to effectively maintain customer relationships on social networking sites.

Sources:

Owyang, Jeremiah. “Social CRM: Not Your Father’s CRM.” http://www.forbes.com/2010/04/09/facebook-twitter-social-media-crm-dell-comcast-cmo-network-jeremiah-owyang.html

“Customer Support via Twitter? Salesforce.com Makes It Legit” http://gadgetwise.blogs.nytimes.com/2009/03/24/customer-support-via-twitter-salesforcecom-makes-it-legit/?scp=2&sq=social%20CRM&st=cse

Neuromarketing: Positive Advance in Advertising or Invasion of Privacy?

First we had companies tracking our website searches and making product recommendations from our previous purchases. Now the new trend is neuromarketing, where companies are literally trying to get into consumer’s subconscious minds to influence their purchase decisions.

The New York Times article by Natasha Singer recently explained this new trend and referred neuromarketing as “making ads that whisper to the brain.” Neuromarketing essentially studies brain activity and measures brain waves to analyze consumer’s responses to advertisements and products.  It could be done simply by measuring one’s muscle contraction, pupil dilation, facial response, skin temperature or by using MRI and EEG technologies. These technologies measure one’s attention level, emotion and memory retention when watching ads or viewing product images. The purpose is to give marketers information about consumer preferences, so that they can make the right advertisements and product designs that would reach the subconscious mind. This would in turn influence consumers to buy the particular product and develop brand loyalty.

Many companies are increasingly using neuromarketing to increase sales by producing the exact products that consumers would want. According to a Forbes article by Laurie Burkitt, Hyundai Motor America used neuromarketing to see how consumers viewed their “sporty silver test model of a 2011 Hyundai.” Fifteen men and fifteen women took part in this experiment where they were to view the different parts of the vehicle, all while wearing an electrode-studded cap. The brain activity of each person was captured and the information showed their particular preferences, which was used to change the exterior design of the vehicle into a more attractive one.     

However, neuromarketing have increasingly become a controversial topic. Many feel that it manipulates consumers and turns them into shopping robots without their approval and thus it’s an invasion of privacy. They “call it brandwashing – an amalgam of branding and brainwashing.” Considering the extent to which advances in technology has allowed marketers to influence my purchase decisions, it is really scary to think about what the future holds. The question remains, do the benefits of neuromarketing overcome the negative effects of behavioral control and invasion of privacy?

Sources:

Singer, Natasha. “Making Ads That Whisper to the Brain.” http://www.nytimes.com/2010/11/14/business/14stream.html

Burkitt, Laura. “Neuromarketing: Companies Use Neuroscience for Consumer Insights.” http://www.forbes.com/forbes/2009/1116/marketing-hyundai-neurofocus-brain-waves-battle-for-the-brain.html