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“Louis CK”, illustration by Eddie Guy, 2011 (The New Yorker, June 13, 2011, p. 127,  © 2011 Condé Nast)

The New Yorker: illustration by Eddie Guy for the review “Man Alone. Louis C.K.’s tribute to truth” by Nancy Franklin, June 13, 2011, pp. 126-127; subscription is required to access the full article. © 2011 Condé Nast.

The portrait shown above was produced by Canadian-born illustrator Eddie Guy. For more information (biography, portfolio) visit his official website (Flash is required) and browse his blog over at Picture Mechanics.

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A good year for Louis CK
A “fun little experiment”
The consumer experience
Business at human scale
References

A good year for Louis CK

I first heard about Louis CK in the very beginning of 2009, when a video excerpt from an appearance he did on October 1st, 2008 on Late Night with Conan O’Brien went viral. The clip “Everything’s amazing and nobody’s happy” was uploaded on YouTube in February 2009 and has since gathered more than 4,5 millions views. In it Louis CK talks about the economic crisis and our relationship with technology (which we don’t quite understand but take for granted anyway). I still find it to be as hilarious as it is accurate.
Last spring, I stumbled upon HBO’s special Talking Funny (it premiered on April 22: see HBO ―which requires Flash―, IMDb). The show features Louis CK alongside friends and comedians Ricky Gervais, Chris Rock and Jerry Seinfeld. As it was noted during this one-hour HBO special, Louis CK is not as “clean” a comedian as Jerry Seinfeld is. For example, Seinfeld rarely (if ever) cursed on his show. On the other hand, Louis CK employs what some may consider as a strong, if not rude language. If I had to put Louis CK on a scale, I’d put him right in between Jerry Seinfeld and Doug Stanhope. I happen to enjoy all of them. Furthermore, Louis CK and Doug Stanhope are very good friends. The latter was prominently featured last August on an episode of the second season of Louis CK’s TV show Louie (IMDb).
After “Talking Funny” I watched his first three hour-long stand-up shows: Shameless (2007), Chewed Up (2008) and Hilarious (recorded in 2009 and released in 2011). Meanwhile I came across Nancy Franklin’s review of Louie in The New Yorker:

If you’ve seen any of C.K.’s work, you know that inappropriateness is only the beginning. It’s not just that he, as the trope goes, says the things that everyone else only thinks; he says the things that people won’t admit to thinking. The show is a kind of tribute to truth. (And to dirtiness.) This isn’t a single-dad comedy, though; more compellingly, it’s a comedy about the death spiral that is life, and about giving reality its due. (The New Yorker: “Man Alone. Louis C.K.’s tribute to truth”, June 13, 2011, pp. 126-127; subscription is required to access the full article)

I decided to give it a try and very much liked what I saw. Apparently I was not the only one. By the end of season 2 (last september) Louie (broadcast on FX Networks) had managed to gather an average of one million viewers per episode (see TV by the Numbers). It earned a 90/100 rating on Metacritic (based on 7 critics) and a 8.8 rating on IMDb (based on 7,864 users). This past summer, the show was nominated for two Emmys. By the end of the summer, FX announced that the show was renewed for a third season of 13 episodes (see The Hollywood Reporter).
Louis CK’s TV show is not the only thing going well for him. Earlier this month, he was featured in the Time’s section “People Who Matter” for the year 2011 (“Louis CK” by James Poniewozik, Dec. 14, 2011). His show took the first place in the Time’s Top 10 TV Series list (Louie by James Poniwozik, Dec. 7, 2011). Furthermore, it was announced a few days ago that the comedian was to host the 68th Annual Radio and TV Correspondents’ Association dinner (or RTCA diner, not to be confused with the White House Correspondent’s Association dinner or WHCA diner: see The Washingtonian).
However, Louis CK’s most surprising achievement this year may have to do with an experiment he ran on his latest show. When the time came to sell Live at the Beacon Theater, he tried his hand at an atypical ―although not new― distribution model. And it worked, big time.

A “fun little experiment”

On November 11, 2011, Louis CK performed live at the Beacon Theater for this year’s New York Comedy Festival. The performance was recorded by his team and in the following weeks he edited the raw material into a finished product. He already self-produced a show before. Hilarious was produced independently and then sold to Epix and Comedy Central. It was thus aired and distributed on CD and DVD by third parties (see Wikipedia: “Louis C.K.”).
This time though things were going to be different. Louis CK took two crucial and somehow bold decisions. First, he decided to release the show soon after the live performance directly on the Internet: no TV premiere, no physical discs (although he may release those later), no boxes. Second, instead of selling the show to major networks or online distributors such as Hulu, Netflix and iTunes, he chose to sell it directly to his fans through his official website louisck.net
The price was fixed at $5.00 USD. Using a PayPal account, anyone in the world could download the show and watch it online. It’s a very, very simple matter of at most three steps: enter a valid email address (so confirmation and login information can be sent to you), proceed to payment with PayPal (yes, a PayPal account is mandatory here as it is the only payment option) and finally choose between streaming the film online or downloading it (or do both). If you so chose to download the film you’ll have the choice between a hi-res version (1280×720 h.264 mp4) or a standard definition version (800×448 h.264 mp4). At around 800 ko/s it took me about 20 minutes to get the hi-res version. There’s also an option to buy the video as a gift for someone else (who will then receive an email with proper login information to access the video).
The file one gets on his computer is totally DRM free. It means a person can basically do whatever she wants with it or in Louis CK’s words: “You can download this file, play it as much as you like, burn it to a DVD, whatever”. As long as she agrees with the 3744 words “Terms & Conditions”.
In the process the consumer will not be enlisted as a member of something or forced to subscribe to a mailing list. What you see is what you get. Nothing more, nothing less. While we’re at it, here’s an outtake from the show:

So the hour long video (01:02:43) was released online on December 10, 2011. What happened next made the headlines of some of the major electronic media. I’ll skip the details and instead list a couple of relevant links at the end of this entry. Here are the basic facts, mostly retrieved from the latest official statement posted at louisck.net by Louis CK (keep in mind this is an ongoing experimentation, so figures may increase in the following days or months):

  • By December 21st, the sales of the video “Live at the Beacon Theater” had crossed the $1 million dollars mark.
  • It means that in 11 days about 200,000 people have bought the video either from themselves or as a gift for someone else.
  • As it is the case with online distribution, there was some fear about what piracy could do to the experiment. The video was indeed (and still is) torrented (distributed freely over P2P networks, in this case without the owner’s consent). But interestingly enough, it is far from being a popular download. At the time I’m writing this, there’s about 40 people seeding the video (making it available for download through P2P networks). There’s no way to know exactly how many people in total downloaded it so far through those means. However, I would think it is significantly smaller than the number of people who bought it through the official website. In fact, there’s an ongoing debate on Pirate Bay (a website which hosts torrent files and allows users to search and download them). In the comments section of the most popular torrent related to Louis CK’s show at the Beacon Theater, users are arguing for and against the illegal download of the video file.
  • Louis CK was glad to publicly divulge how much money he made and how the money was used (or was to be used):
    • $250,000 for production costs;
    • $250,000 in bonus for his staff and all the people who worked with him on the show;
    • $280,000 went to a few different charity foundations. Those foundations were either recommended by friends or by Twitter users;
    • So for the moment that leaves about $220,000 for himself to enjoy as he pleases.

There were many comments made about Louis CK’s surprising success with his atypical distribution model (although not new). One can find them below (and some more). I’m mainly interested in two things. One has to do with the consumer’s experience. The other has to do with the community, that is the relations that somehow keep us together ―for better and for worst―, clients and restaurant owners, fans and singers, computer users and software developers, audiences and comedians. The two are of course intricately entangled.

The consumer experience

Let’s start by considering the consumer’s experience. The entertaining industry has been fighting piracy for years. It seems to me that a lot of energy and money is spent in order to develop copyright protection technologies such as DRM (Wikipedia: “Digital rights management”), HDCP (Wikipedia: “High-bandwidth Digital Content Protection”) or even the upcoming SOPA initiative (Wikipedia: “Stop Online Piracy Act”). This strategy is highly problematic in at least two ways.
First, it doesn’t work very well: DRM and HDCP protections have been broken a long time ago and there’s actually an important negative reaction by Internet users against SOPA (see for example Time: “GoDaddy Boycott over SOPA Support Still On, Exodus Looms” by Matt Peckham, Dec. 19, 2011). Blu-ray discs are ripped and torrented as soon as they hit the market (sometimes even before).
Second and most importantly, all this technological warfare often impedes on the consumer experience. The user interface gets more complicated and the consumer gets restricted in what he can chose to do with the film he bought and the music he legally acquired. For example, one can read Khoi Vinh’s “Blu-Ray Blues” (posted on January 10, 2011) while keeping in mind that Blu-ray technology was in large part developed precisely to counter piracy problems to which the DVD was and still is exposed.
Torrents are not easy to use either. One needs to find a good torrent client and to configure it properly, to learn the difference between a dozen of file formats from .mkv to .rar to .mp4, to figure out what and where to find the desired material, to manage one’s bandwidth consumption, etc. Someone motivated enough could learn how it works in a day or two. My mom wouldn’t be able to do it in a month. And I believe there are a lot more consumers out there like my mom than there are so called “pirates”.
Torrents are (relatively) complicated to use, but once a person gets the file she wants, she’s free to do whatever she wants with it. Once registered, Hulu, iTunes and the likes are (relatively) easy to use but the consumption of the product comes with serious limitations (last time I checked, the iTunes Store’s “Term and Conditions” was running a little bit over 17,000 words).
Fighting piracy could mean investing serious effort and money to improve the consumer experience. If it’s better and easier, they will come. That’s not a new argument, but it’s an argument worth repeating. Here’s a comment made by a reddit user to Louis CK during a Q&A he did on December 12:

The video format is perfect, the encoding is clean, it’s dirt cheap and was hosted on a fast server (and damn fine content to boot). That’s all we ask for. I promise you half of us labeled pirates just want a specific or usable format that works with our home entertainment setup. We’ll gladly fork over gobs and gobs of money if you just continue to provide content in this style. It’s simply not a price thing for many of us.

Business at human scale

Which brings us to the second point or the ways we interact with each other. Often, when I buy something (when I consume something) it’s impersonal and way beyond my understanding. I’ll still buy albums on iTunes because sometimes it’s convenient for me. But I’m really not sure about the way the money I spent is used. What percentage goes back to the artist? The dynamic of this distribution model mostly eludes me: I cannot represent it to myself (that’s another way to think about the “crisis of representation”).
I’ll go to an ATM machine to get money but I don’t know how many people are working to make that happen, what they do exactly and more importantly if they care about what they do. I don’t know how the machine works. And I doubt that the concept of “happiness” has its place in the process by which I get my money (even though they are telling me that I’m “more than a number”). The same thing applies when I buy a Coke, or an external hard drive. To a certain extent it’s okay and even necessary. There are things we use and services we need that come from or run on systems so complex we cannot grasp them.
It can get to you though. It’s getting to me when I have to go to a Federal office to fill some forms. I run from one “agent” to another feeling they are like automated machines transforming me into an automated machine as well. They don’t care about me (only the forms) and I don’t care about them (I just want it to be over as fast as possible). I sometimes feel that my indifference toward the product (or service) I consume in-differenciates me in return. It’s a common feeling nowadays I suppose, to feel like a nobody, like a lost, disaffected subject.
Louis CK’s experiment most likely worked for multiple, practical reasons: because the transaction process is easy and painless (as I explained above), because the show is funny, because he could rely on a pre-existing community of fans (I’m thinking about Louie‘s regular audience), because he quickly decided to tell everyone how exactly the experiment was going (which in turn fueled media attention and surely helped to attract new potential buyers), because the price was so low it was “close to stealing”, etc.
But most importantly ―I would like to think― it worked because this experiment was run (is still running) at a human scale. By cutting on the intermediaries, not only Louis CK was able to offer his show at a very low price, but he keeps control on the revenue. Instead of paying for CEOs, lawyers, distributors, etc., the consumer who chose to buy the video will see his money return into the pockets of those directly involved in the production process as well as in charity donations.
Furthermore, this consumer knows he’s making a transaction with another human being, not a legal, corporate abstraction. That’s an economic model at a scale I can actually understand and relate to. It has the potential to bring more satisfaction to both the creator (the content producer or the service provider) and the consumer. That itself should translate into something economically interesting for both parties.
Could Louis CK’s model work for everybody? I’m quite sure it could not. Does his experimentation invalidate the dominant model? I don’t think so: it doesn’t need to in order for it to work. Does it constitute a threat to networks, Netflix, iTunes and the like? Likely not: they are complementary ways of doing business.
In the opening bit of his clip “Everything’s amazing, nobody’s happy” recorded in October 2008, Louis CK talks about the economic crisis:

[…] when I read things like the foundations of capitalism are shattering I’m like maybe we need that. Maybe we need some time where we’re walking around with a donkey with pots clanking on the sides, ya know.

Louis CK’s “fun little experiment” looks like an effective way to explore other interesting, simpler business models. Sure, louisck.net has nothing to do with a donkey, but it’s a nice ride nonetheless.

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References

Finally, here are some relevant resources about Louis CK’s experiment as well as additional material I used for this entry:

“Louis CK Live at the Beacon Theater” (photo from louick.net)
“Louis CK Live at the Beacon Theater” (photo retrieved from louick.net - title added in Photoshop)
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