Other Business models
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The story of Gillette and the famous "razors and razor blades" business model is legendary at this point. The story goes that King Gillette revolutionized business by coming up with the strategy of selling razors cheaply, but then locking people in to expensive disposable blades, where the margin existed. This strategy has become so well-known that it's mentioned all the time and seen in lots of other industries as well, especially the technology industry.
I am not advocating charging for content online, however, it may be a necessary evil for some content providers to survive. Without subscription revenues the newspaper industry is dying.
Lately, I’ve been rethinking the concept of “business model” for startups, in favor of something I call “business ecology.” In an ecosystem, each participant acts according to its own imperatives, but these selfish actions have an aggregate effect.
I gave a talk last year to a group of TV executives gathered for an annual conference. From the Q&A after, it was clear that for them, the question wasn’t whether the internet was going to alter their business, but about the mode and tempo of that alteration.