[run4yourlives]

No, actually you are.

I hate to break it to you but you as a seller do not get much of a say on what value your product has in the marketplace. This is as true for design as it is for anything else.

The value of a product is exactly what buyers are willing to pay for it. Saying things such as "spec work devalues the entire design industry" suggests clearly that your definition of value is not in line with your customer's definition.

When this is the case, you basically have two options:

1. Demonstrate an increased value to the customer that you bring that they are willing to pay for, or;

2. Lower your price to compete.

Walling off your industry to preserve profits that aren't in line with the real value of the product might be desirable but it is unsustainable in the long run in today's modern world. Ask the music industry.

[Tycho]

Walling off your industry to preserve profits that aren't in line with the real value of the product might be desirable but it is unsustainable in the long run in today's modern world. Ask the music industry.

I upvoted for the rest of the comment, but this bit seemed off. Mainly because the crowd-sourcing idea relies on the respect of copyright even more so than the music industry.

[run4yourlives]

There's a difference between respect of copyright and artificial inflation of value. The recording industry would have you believe that the consumer is stupid and has no respect for the value of the artist. This is simply false.

iTunes is a perfect example that given the correct price point, people will pay for music. The big issue is that price point might not be high enough to support the massive marketing and promotion machine that exists. That isn't the consumer's problem though.

In the end, it's actually a perfect example of my point:

When technology reduces the barrier to entry to next to nothing, industries that were predicated on high barriers need to adapt, or they will die. It's a good rule of thumb that the moment you start to do something other than talking to the customer of your service in an effort to preserve revenue, you have a value disconnect with your market.

[Tycho]

Hmm, your argument seems to rest on the conflation of 'barriers of entry' with 'copyright protection.' Consumers can now easily download music illegally - what's that got to do with barriers for entry? What market players have successfully exploited lowered entry-barriers?

[run4yourlives]

You've heard of itunes, correct? Pandora? Grooveshark?

[Tycho]

Pandora is not really a subtitute or rival for the existing business models - more like a competitor for radio stations. Grooveshark from what I can tell relies on breaking copyright. Meanwhile iTunes is successful but a) not much cheaper than CDs and b) only a small portion (combined with the other MP3 stores) of the overall music retail market. So it would appear to me that music is sold by 'the industry' at a price people do find acceptable, round about the same price they'd been selling at during their most successful days, which ended with the popularization of illegal filesharing.

Basically out of all the people who love music, a large subset of them will pirate it without qualms, and that's all that's really going on here. The changes brought about by the internet have just shrunk the overall industry, rather than allow it to be reshaped by visionary businesspeople or artists. 99 Designs works because due to copyright protection designers feel confident about showing work before receiving payment, meanwhile the music industry is failing because people feel confident about avoiding the legal sanctions of downloading copyrighted material. That it should be like that is just an accident of law enforcement practices and tracibility.