Lazy Man and Money

$5 MP3 albums from Amazon (Aerosmith, Death Cab for Cutie, James Taylor)

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If you aren’t in the mood for a foot-long sub at Subway (and who isn’t?), parlay that money into some good music from Amazon. I got an email about a $5 sale they are having on 50 of it’s MP3 albums. I thought it would be fun to click through and see all the no-name artists that they had there… except that some of them are quite popular. I did get a chuckle from The Raspberries (not to be confused with The Cranberries), but seeing Aerosmith’s Big Ones surprised me. It has 13 songs that got significant air play (some still do). Doing the difficult math, 15 songs for $5 comes out to about 33 cents a song. Take that iTunes!

Here are some other highlights:

There are more to choose from, but I’m kind of biased towards the Boston music: Aerosmith, James Taylor, even the Death Cab for Cuties album has a song called Lowell, MA on it. They had Dolly Parton, Kanye West, The Greatful Dead, and Etta James… something for everyone.

Go check out Amazon’s $5 albums.

Lehman Bankruptcy, Bank of America/Merrill Lynch: What Can We Learn Here?

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I try to take a couple of weeks of vacation outside of America and Wall Street explodes. Lehman is filing for bankruptcy. Bank of America is buying Merrill Lynch. I don’t even need to get into American Insurance Group losing a third of value. It will teach me to get away from it all in isolated resort in Phuket, Thailand. I should be sipping Singha’s by the pool now, but I found myself drawn to the financial news.

One analyst on BBC World was asked about Lehman’s reported bankruptcy filing. He made a great point they don’t have a steady stream of deposits – and they don’t enjoy the same Federal protections. This is in contrast to companies like Bank of America and Citigroup who are much more diversified. It is this diversification that is allowing Bank of America to buy Merrill Lynch. Once again, we are reminded the value of diversification. Interestingly the next question was about whether it’s no longer worth it to “focus on one thing and do it well.” The analyst kind of panned the question. I would have said that it’s great to be focused in a popular area when times are good. When times are bad, it can be trouble.

Doesn’t that bring up an age old dilemma – is it better to diversify or focus? In many instances, I believe in diversifying. For investing, I think it’s just a certainly the way to go. When it comes to income streams, I believe in diversifying as well. Perhaps, I don’t give focusing it’s due. When it comes to being really successful, it seems that most do it by focusing on a few things and being the best at them. Aerosmith lead singer, Steven Tyler, says that anything worth doing is worth doing right. I mention that example, because he’s one of the best in the world at what he does. More than ever before, I’m reminded that diversifying seems to lead to a safety and possibly an average to above average lifestyle, while those looking for more may be better off focusing – just be prepared to end up bankrupt in your quest for greatness.

Bundled Football Tickets, Video Game Systems, Music, and DVDs… Arrrg!

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Note To Businesses: Consumers Don’t like Forced Bundling of Products

bundles.jpgWith football season coming up, my thoughts have started to slowly turn to blocking, blind-side blitzes, and blackouts. Recently tickets for next seasons AFC Championship rematch, New England Patriots vs. San Deigo Chargers went on sale. Though it’s a mere 8-hour drive, I was prepared to call in and try my luck at getting tickets. Then a friend told me something that I couldn’t believe. In order to purchase tickets for that game, you must buy tickets for two preseason games (see press release for details). If you are unfamiliar with preseason football games, the games are of little interest to fans. Typically the coach doesn’t want to risk a big injury, so the players that will play 90% of the season only play 15% of the preseason game. Teams don’t necessarily try to win as much as they try to evaluate the talent on their roster.

If I were to try to get the Patriots tickets, I’d surely have to try to sell them or not use them. Driving 8 hours one way for each of the games doesn’t interest me – especially when one of them is the 4-12 Falcons from last year. I looked into the possibility of selling them, but a distant friend says that they generally only go for 25% of their face value. In the end, what the Chargers have done is carefully crafted a scheme to effectively raise ticket prices for the games in demand rather than lower the cost of the preseason tickets to a price that reflects the marketplace’s demand. It doesn’t sit well with me. I’d rather see them just charge different prices for the games. Maybe there are laws against variable ticket pricing or perhaps the NFL doesn’t allow it. Either way, this is effectively the same thing.

It’s not just football ticket bundling either. It’s also:

  • Video Game System Bundling – Often video game systems will be released with a game bundle included. If you want the system, you better like the games that are bundled. If you don’t, you might be waiting a long time to buy the system.
  • DVD Movie Bundling – One of my favorite shows is Buffy the Vampire Slayer. After releasing the seasons individually, they released Buffy the Vampire Slayer: The Chosen Collection. This 40-disc collection has one DVD of “exclusive, never before seen extras.” If you want the information on this DVD, you are going to have to pony up nearly $200. Sadly, I know a few people who will do just that.
  • Music – Greatest Hits Collections – I’ve fallen victim to this one myself. I used to love Aerosmith (still do, but not as fanatical as I once was). They have a couple of albums like Gems which is essentially a greatest hits collection. However, it adds the studio version of a song that was only previously released as a live version. They’ve repeated this formula a couple of times. It’s pretty common, because studio executives know that fans of the band will by the album for that one song. Of course things are different now with everyone using iTunes.
  • Cable TV – In order to get FX and ESPN, one is often forced to buy a package of some 300 stations. You want high definition and a DVR? Well that requires another higher level of programming. Consumers say they want to pay only for the channels they watch. Cable execs say that it would be expensive as the popular channels subsidize the more niche channels. It’s also good for them to say, “Your cable bill has only gone up 50% in the last 3 years and we’ve given you access to 300% more programming.” It’s just not programing that you care about.

It really comes down to money. Executives of companies have found some ways to get you and I to give them our money. They play with our emotions to make their sale. In some ways, I want to congratulate them on a well-devised plan. In the end, I have decided that such marketing has left a bad taste in my mouth. Perhaps that’s why the iTunes store has been so successful – it’s allowed people a way to escape the bundling of products.

Photo Credit: °Florian