Mediaworks and Mega

January 17th, 2013 at 9:00 am by David Farrar

The Herald reported:

MediaWorks has cancelled an advertising campaign for internet millionaire Kim Dotcom’s new business, Mega, which is due to be launched on Sunday.

The new online data storage facility, a successor to the defunct Megaupload, promises to be an online haven for internet users, which he has previously said will be “powered by legality and protected by the law”.

On Twitter today, Dotcom said MediaWorks had cancelled a radio advertising campaign which had been booked prior to the launch.

“Apparently some music labels complained to MediaWorks about our radio ads. Booking of over 500 ad plays terminated. Wow!!!

“Not blaming MediaWorks. They are a great company with great people. It’s the music labels that are abusing their power, again.”

Dotcom appealed to non-MediaWorks radio stations to play the advertisements instead.

A MediaWorks spokeswoman confirmed the campaign had been pulled.

“For commercial reasons we are not playing the Kim Dotcom advert.”

That is somewhat concerning. If Mediaworks had concerns about whether the service being advertised was legal, it would be appropriate to consider not running the ads.

But it sets a nasty precedent if one group of advertisers or suppliers can get a media outlet to refuse advertising from a competitor – not during a sponsored progamme – but from the entire network.

Would we want a media outlet refusing advertisements from a car manufacturer because their horse and buggy supplier objected?

Now Mediaworks as a private company can choose to do what they want. However allowing one group of suppliers to pressure you into turning down paid legal advertising is a pretty bad precedent to establish, as it may encourage others to do the same.

If the issue is that they thought the service being promoted was not legal, then again that would be different. But they themselves have said the decision is for commercial not legal reasons.

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23 Responses to “Mediaworks and Mega”

  1. dime (10,207 comments) says:

    sounds like good business to me!

    mediaworks owns the ROCK and other music stations right?

    If i was running a record company id be using the same tactics :)

    why is he running ads on the radio anyway? is this just part of his PR blitz? make his business seem more legitimate cause its on the radio? get more kiwi support thinking thatw ill make it harder to ship his fat ass off to the US?

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  2. BeaB (2,164 comments) says:

    So we are expected to accept Dotcon’s explanation at face value?

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  3. Yoza (1,926 comments) says:

    Strange that this should raise any eyebrows, I would’ve thought it was par for the course. It is very rare for any of the mainstream media outlets to be anywhere near controversial for fear of upsetting corporate revenue streams derived from advertising. As dime points out, self-censorship in the interests of commercial objectives “…sounds like good business”.

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  4. RRM (10,097 comments) says:

    I’m trying to think of other successful online ventures that have relied on radio advertising…

    Google? No…

    YouTube? No…

    Twitter? No…

    MySpace? Arguably… (I used to hear “and don’t forget to check out their page on MySpace” quite often.)

    Facebook? No…

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  5. Weihana (4,620 comments) says:

    …and if they believe the service being offered is illegal then the avenue for that is the courts. But these are people used to getting their way. They had the feds intentionally deceiving courts on their behalf, they’ve been able to shut down a major private company without so much as a chance to defend themselves in court before funds and servers are seized, and now they can dictate who is and is not allowed to advertise. If ever there was any doubt that they were a bloated monopoly with too much power…

    Protest with your feet (or fingers): http://www.thepiratebay.se

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  6. scrubone (3,097 comments) says:

    RRM, I think you’re thinking of whoar.co.nz

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  7. Weihana (4,620 comments) says:

    Dotcom gets all the advertising he needs from the news media.

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  8. Azeraph (612 comments) says:

    Business is business but Dotcom wouldn’t try another sneaky runner, he’s too public now so he’ll play by the books but it is interesting to see how people always fall for the “Stinks sticks” meme.

    It goes to show the level of critical assessment skills we have as a nation.

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  9. vendetta (60 comments) says:

    The only real surprise is that they initially agreed to it at all. This will be a result of the music companies (Sony, EMI etc) throwing their toys and threatening to stop working with MediaWorks radio stations if they allow ads for a competitor product to be aired.

    One more example of the labels attempting to swim against the tide rather than innovate…

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  10. dime (10,207 comments) says:

    “One more example of the labels attempting to swim against the tide rather than innovate…”

    lol we should apply that logic to gas stations. just start taking petrol for free. when they complain just say – you guys need to learn how to innovate!

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  11. RRM (10,097 comments) says:

    threatening to stop working with MediaWorks radio stations if they allow ads for a competitor product to be aired.

    Saying “competitor product” is being generous… file-sharing and file-storing web services have traditionally been tools for ripping off the copyright and I.P. of record companies, rather than “competing” with them.

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  12. vendetta (60 comments) says:

    RRM, Dime – Irrelevant. Those are illegal actions, while Mega has supposedly been set up to function within the law (and with the amount of scrutiny the service is likely to be under, I’m inclined to believe it will) .

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  13. RRM (10,097 comments) says:

    vendetta –

    Yes but when you have a name and reputation like Dotcom, people are going to jump to conclusions about your activities, that’s life.

    (It’s business too, I work in my construction industry and my boss just won’t get involved with projects for a couple of fairly high-profile crooks in this town who are known to be bad payers… just as a different sort of example of the positive power of negative reputations! )

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  14. RightNow (7,014 comments) says:

    Dotcom is currently facing legal action for his past ventures so you can’t blame Mediaworks for being gun-shy if there are legal concerns.

    A year or two ago a distributor of electronic cigarettes (that dispense nicotine vapor) wanted to run radio ads with Mediaworks. The MW legal team spent a fair bit of time and effort trying to get a definitive ruling on whether these things are legal – clearly the ad revenue was going to be worth the effort. The end result was they couldn’t get a definite yes, so no ads and no revenue (Incidentally I understand the actual reason you can’t advertise e-cigarettes with nicotine is that nicotine can only be derived from tobacco, so these products are effectively a tobacco product)

    I also support their right to reject advertisers for commercial reasons.

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  15. scrubone (3,097 comments) says:

    People and companies have the right to make stupid decisions.

    And the open market means that we have the right to use or not use the services of those who, in our judgement, make such stupid decisions.

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  16. dime (10,207 comments) says:

    “Those are illegal actions, while Mega has supposedly been set up to function within the law ”

    LMAO

    Yeah. Heres how they stay within the law.

    Shitbag #1 uploads some music and posts links all over the net.

    Shitbags #2 – 24,587 download said music.

    Someone finally lays a complaint. Mega removes said file.

    Mega is all legal and nice :) yet, profiting off stolen IP.

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  17. Weihana (4,620 comments) says:

    dime,

    Mega is all legal and nice :) yet, profiting off stolen IP.

    Good. Intellectual property was always intended as something to benefit society by encouraging the creation of creative works. This concept has now been bastardized. Indeed the very term “intellectual property” conveys a notion that it is analogous to real property which is bogus in my view.

    Profits may be falling. Good job I say. It’s fat for a bloated industry. Artists which are truly valued will always be rewarded for their popularity and sorry but if you are mediocre you might just have to get a real job to live off. You were never going to be rich anyway (and no one is bothering to download your crap, you probably can’t give it away).

    It’s been over a decade since rampant file sharing has “threatened” the entertainment industry. And yet movies and music are more widely available than ever before. Society has nothing to lose by telling the industry to suck it up.

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  18. lofty (1,317 comments) says:

    Weihana, private IP such as that developed and owned by our company , does not fall into your catagory of something to benefit society does it?

    Do you mean because it is on the web that IP should be available to everyone, or is your definition of IP music orientated?

    I can assure you that our IP is real property, in fact it is the heart of our business, and is kept very very secure indeed.

    We know that our IP sure can benefit society, but it aint free. And only we can use it. Thats business.

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  19. superflynz (14 comments) says:

    Given the success (and foresight) of his PR campaign in 2012, surely this was also foreseen as a likely outcome. It is not that hard to connect the dots.

    The result? 10x more free promotion by the mainstream media. Well played, I say!

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  20. Rex Widerstrom (5,013 comments) says:

    RightNow says:

    Incidentally I understand the actual reason you can’t advertise e-cigarettes with nicotine is that nicotine can only be derived from tobacco, so these products are effectively a tobacco product

    Nicotine patches and gum are freely advertised in Australia. That would seem to be a particularly narrow-minded, counter-productive law if that is the case in NZ.

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  21. Weihana (4,620 comments) says:

    lofty,

    Sorry my comments were indeed oriented towards the entertainment industry and I do acknowledge that intellectual property is a broad term which applies to many different types of information. Of course there should be different rules suited to different categories. For instance an invention is not the same as creative entertainment.

    But of course neither am I saying that there should be no copyright protections even for music and other entertainment. But when a new technology comes along that undermines their current business model they should be expected to adapt and find revenue elsewhere rather than to impose draconian new measures to try and prevent the inevitable.

    What I do oppose is moralizing about intellectual property without recognizing that the rules around it are practical in nature designed to strike a balance between the interests of the creator and the interests of society at large.

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  22. RightNow (7,014 comments) says:

    Rex, I believe the patches and gum are sold as ‘therapeutic medicines’ or aids to give up smoking, but the e-cigarettes can’t be. I think they have to go through some exhaustive/expensive testing processes in order to be so labelled.
    Either that or the government is still working out how to tax them.

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  23. Paul Marsden (990 comments) says:

    MediaWorks may well in breach of the Comerce Act and/or, Fair Trading Act, for refusing to supply goods and services

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