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Building a new business is tough. And even though the internet has significantly reduced barriers and created incredible opportunities for entrepreneurs around the world, building a successful technology-based business is still challenging.

Unfortunately, the challenges sometimes lead companies that are labelled as 'innovators' to do something innovators usually don't: complain. The past week has given us two examples of this.

Seattle-based ivi TV bills itself as a company "hard at work innovating the way to bring TV online with the professional quality the very word television entails." For $4.99 each month, ivi TV subscribers recieve access to local television feeds so that they can watch their favorite programs anywhere they go, online, through a desktop application.

There's just one problem: ivi TV never obtained the rights to 'rebroadcast' this programming. So not surprisingly, ivi TV was sued, and yesterday a judge issued an injunction against the company. ivi TV plans to appeal, and the company's CEO published an angry response on its blog:

This fight is for the people and their right to choice and control over their own entertainment — and it will continue. The oppressive big media networks must open their doors to innovators or they will inevitably fall. People want responsible choice, not the one-size-fits-all television offerings imposed by powerful media interests.

Strong words, but they're disingenous. ivi TV's fight isn't for "the people", and it has nothing to do with "powerful media interests." The basis for ivi TV's 'innovation' was a loophole in copyright law that it thought would enable it to sell access to other companies' content for a relatively nominal fee. ivi TV is simply upset that a court ruled that loophole doesn't apply to it.

Time may prove the companies that sued ivi TV to be short-sighted with their own content strategies, but needless to say, ivi TV's argument that "oppressive big media networks must open their doors" to every company that would like to resell their content for a few bucks a month is hardly a convincing one for obvious reasons.

ivi TV isn't the only upstart railing against big companies in the past week. Readability, a company that seeks to promote "a sustainable publishing ecosystem" by giving consumers a new way to support publishers, lashed out at Apple after finding that Apple's new in-app subscription rules might force it to share 30% of its revenue from iPhone and iPad-originated subscriptions.

Readability's creator, Richard Ziade, wrote an open letter to Apple, telling the tech giant, "If we implemented In App purchasing, your 30% cut drastically undermines a key premise of how Readability works." He went on, "Before we cool down and come to our senses, we might as well share how we’re feeling right now: we believe that your new policy smacks of greed."

One might point out that Ziade's letter is hardly selfless in its own right. Readability is a for-profit company that shares 70% of all membership fees with its publishers, and keeps the other 30% (sound ironically familiar)? Assuming a $5.00 monthly fee, Readability would have to share $1.50 with Apple for in-app subscriptions, leaving Readibility $2.45 to share with its publishers, and $1.05 to keep.

That may not be ideal, but it's unlikely going to put Readibility out of business. The more important question Ziade never asks: will Readibility and its publishers make more money being in the App Store (even with Apple's fee), or will they make less? After all, how much Apple takes matters a whole lot less than how much you and your partners make.

Frustration over Apple's rules is understandable, and Apple certainly doesn't help itself when those rules lack clarity. As it turns out, Apple's rules may not even apply to Readibility, but after reading Ziade's hasty response, one could just as easily argue that Readibility is greedy for asking Apple to alter its business model so that Readability can maintain its current margins.

In both cases discussed above, there's a common plot: 'innovators' complaining about others who are (allegedly) impeding their innovation. Which is somewhat odd, when you think about it. Innovators are supposed to blaze new trails, finding better ways to do things and leaving slower companies in the dust. Yet increasingly, those who are billed as cutting-edge upstarts seem to be asking others (partners, competitors, frenemies, etc.) to help blaze those trails for them.

Innovation generally doesn't work like that. If you're trying to do something new and find yourself complaining and blaming, chances are you're not really innovating. While theres no formula for innovation, the truth of the matter is that most innovators don't ask others to drain the moats they've built around their businesses; they're too busy building castles with moats of their own.

Photo credit: binusarina via Flickr.

Patricio Robles

Published 23 February, 2011 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (1)



At least this guy is out there doing something. You just sit back and write about it, saying "I told you so" when you don't have the balls to do anything like this yourself. And if you'd look at the laws, he actually is right. We live in an area where we don't get cable and relied on ivi for a precious 4 months and I totally miss them now. There is a definite need, and you can't tell me FOX needs more money, or cable companies need more of our money. He is not complaining, he is doing something for those of us who need/used the service. Lay off, man.

over 5 years ago

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