Warner Bros and BitTorrent

I enjoyed reading this case, but I didn't really find any questions to answer at the end. I was a bit surprised that BitTorrent was able to establish an agreement with Warner Brothers, given the issues that have surrounded peer-to-peer networks in the past. I would think that Warner Brothers will move forward very carefully with this partnership to ensure that all their content remains protected by BitTorrent. There are always people out there who are looking to get something for nothing. However, I do have to give Warner Brothers credit as they are taking all the risk of being a first mover in this new industry. I think they recognized that, like the music industry, they were missing out on a lot of online consumers who would pay for their product. If successful, Warner Brothers stand to make quite a bit of money by being the only one in the market with the electronic distribution system.

One thing I do believe Warner Brothers needs to monitor moving forward is the sharing of illegal movie files online. If the movie industry is going to be successful in online content distribution, they are going to have to go after people who illegally distribute their product. The music industry had to do this same thing when they went after the top downloaders of illegal music files. The motion picture industry may be forced to bring lawsuits against hackers and illegal file sharers as well. It will be interesting to see if the security settings that BitTorrent has put in place will be strong enough to keep the content safe.

If the BitTorrent and Warner Brothers partnership is successful, I would expect BitTorrent to solicit other movie studios for online access to their content as well. Warner Brothers has taken the first step. It is up to the rest of the movie industry to follow them. That is the direction the movie industry needs to go as consumers begin to demand more online video content. I'm not sure whether that will be through P2P networks or some other vehicle.

ezboard

Ezboard is an interesting company largely due to the fact that it was able to survive the Internet bubble burst in 2001. Unfortunately, that left it with very little resources to build upon its infrastructure that was the basis of its original design. For the years following 2001, ezboard was just trying to stay in business by making very small changes with what little resources it had. If Robert Labatt hadn't come into the company, I really think the company would have tanked within a year. It did not seem like any anyone on the management team had an idea of how to move forward, most likely due to the fact that the company was so constrained on resources. I think Robert Labatt knew that upgrades were necessary if the company was going to stay in business and did a good job to get it on track. I also think the company was under very poor management before Robert was hired. The fact that he could cut costs by such large numbers indicates to me that the CEO before him really did not know how to run an efficient company in any regards.

At the present time of the case, ezboard is at a critical point where it is going to grow and prosper, or fade away to banruptcy. The direction it goes all depends on how the company leverages its new software platform with its subscription model. If this is done correctly, the company should be able to see some strong growth in both revenue and profit. In my opinion, ezboard needs to first use the "slow-go" approach for Version 8.0. It should have learned that its users are very fickle, as evident in how many were lost during its 25 hour shoutdown when it switched data centers. Although ezboard will have to forego immediate revenues by taking the six months to test and collect data, it stands to lose a lot more if it unveils a program full of bugs and other software issues. Once version 8.0 is in place, I'd like to see ezboard go to a tiered subscription model, where less access is given to non-paying users. I mean, 99% of the users (9.9 million people) are using the site for free! It's amazing they are breaking even under these conditions. If the free users are limited to whether they can post or how much they can post, it would create a larger benefit gap between them and the paying users. While some people would leave ezboard for a competitor, I think a large number would also sign up for the basic plan just so they can continue to communicate with people they know on a system they trust.

The bottom line is that ezboard has the justification it has been looking for to modify its subscription program through the release of Version 8.0. It will now have an up-to-date site that competes well with the rest of the market. It needs to capitalize on the 99% of its users are are paying nothing to use the site, and even a 1% increase in subscriptions will generate a substantial amount of revenue.