Pretty Lights and BitTorrent Bundles

Description

Pretty Lights and BitTorrent Bundles: Abstract

This case describes the innovative strategy implemented by musician Derek. V. Smith (aka Pretty Lights), to penetrate the electronic music market. In 2014, his latest album was nominated for a Grammy in the Best Dance/Electronic Album category, and he now heads a label that produces not only his own creations but also those of other world-renowned artists in that musical genre.

A key component of this success was the decision to make digital files of Smith’s tracks available free of charge using BitTorrent software. The music could be downloaded using bundles composed of a number of music tracks and a video clip of one of Smith’s performances. Although the download was free, part of it was locked. To unlock this part, users had to provide their e-mail address, enabling Pretty Lights to develop a database that could be used to promote his concerts through direct marketing. Pretty Lights pioneered the use of the BitTorrent platform to distribute his creations, but this strategy has since been adopted by music industry stars Madonna, Moby, and Radiohead frontman Thom Yorke.

The case serves as a springboard for exploring issues related to the monetization of music, copyright, and the marketing of cultural offerings.

Teaching objectives

Understand and explore the concepts of marketing, distribution, and disintermediation of cultural products. In the context of cultural products, explore the issues of price setting, zero price, communication, promotion, and customer relationship management. Understand the concepts of personal branding and its links to entrepreneurship.

Main themes covered

• On-line distribution systems
• Disintermediation
• Communication channels
• Downloading bundles
• Marketing music

Concepts and theories related to the case

• Disintermediation of distribution
• Use of bundling
• Pricing strategies and free cultural offerings
• Business models in the music industry

Additional information

Also available in French.

Teaching notes are available for teachers only. Contact the HEC Montréal Case Centre for more information.