Saturday, December 08, 2007

Radiohead to Onbadhu Roobai Nottu

What's common to Radiohead and the soon to be released tamil movie Onbadhu roobai nottu: they come at a price of zero.

Radiohead got into the headlines due to their weird (innovative?) pricing strategy of pay what you want. In a rational world, no one who buys the album should pay for it. But not all are rational. Radiohead did make some money, whether it is big or small is a totally disparate issue.

Now a tamil movie Onbathu roobai nottu (Nine rupee currency) is coming up with a similar concept. In all of the Pyramid company owned theatres in Tamilnadu, the movie is to be screened free without any ticket. Post the show, the audience is expected to pay or rather give how much ever they feel the movie is worth by depositing cash in a hundi. At first thought, the revenue model looks like a road side koothu happening in the rural streets. This strategy carries with it one basic risk: people not paying up after the movie. All these revenue models based on the concept of tipping the waiter at a restaurant will not hold when there is minimal or no eye contact with the waiter (or producer) and hence no one to self-coerce oneself not to be stingy.

1 comment:

Karthik said...

True. We've been taught consistently to optimize greedily. If the no. of people who have had the opportunity to unlearn this ingrained tendency crosses a certain threshold, such a system can become sustainable. There's no reason to believe that we are even acceptably close to this threshold. Also, there will be a fair amount of cases with partial unlearning who just make a token payment for satisfying themselves. There will just be a central portion of the gaussian curve with a very low mean. ;) Its funny that when economists have been moving to irrational models of action even in the developed nations, such an experiment is being tried in a nation as ours. Edhaa therudhaanu paapom.