Value Creation of CEO and Chief Blogging Officer.
Then answer given by
Damodaran is what internet as a distribution model is all about. The distribution will work only when your commitment is not the to the distribution but to the value your work creates. The issue is that many of those who create so called 'Value' or 'intellectual property' are high on distribution crack cocaine addiction wagon and as such are addicted to the distribution that pays them most even if it puts a barrier to accessing that value by others. (from
Motley Fool Hidden Gems: Interview With Prof. Aswath Damodaran [Subscription Required]: I made some phrases in bold letters)
James Early: My question might be getting more toward your life philosophy. Your website has an incredible amount of information for free, there for anyone who wants to look at it. Why do you do that? What about your passion for industry and prosperity?
Aswath Damodaran: I measure return on capital very simply as I invest time capital into creating papers, books, lectures. For me, the maximum return on capital is if people use what I do. It has driven my publishers crazy because on my last four books, I put the entire book online for free. I have had calls from my publisher the next day saying, "What are you doing? You put your own book online. Aren't you worried that you will sell less?" They have completely misunderstood my objective in writing the book. They thought my objective in writing the book was actually to sell a lot of books and make money.
My objective in writing the book was to get the most people to read the book. From that objective function, what I am doing makes complete sense to me because more people read my book if they can download the book and read it than if they are forced to pay an absurdly high price for that same book. In fact, the reason I did it was more for people outside the US than in the US because I have actually got emails from an Indonesian analyst saying I would love to buy a book, but it is a month's salary for me! I don't want to put him in a position of spending a month's salary to buy my book or not reading my book at all, so I said to go ahead and read. It is not as if I am losing sales by doing it. The reality is, if somebody wants the book they are going to buy the book, if they can afford it. If they can't afford it, this is all moot anyway. They wouldn't have bought the book."
As this example I can see why
Cluetrain Manifesto is online for free and you can also buy it if you wish to have a printed copy. This is also why
Chris Locke is creating so much good shit on his websites for free. This is what
HighBeam didn't get about Chris Lock's chiefbloggingofficer blog contribution to Value Creation because the dude is not addicted to distribution as value creation but is addicted to Creation as Value Creation and then finding the best distribution to share the creation. When the Gig Ended for Chris at CBO, HighBeam just became another information pusher and the company lost value. Remember that CEO's job in any corporation is not to strategise how to grow a company and create earnings but instead it's to create Competitive Advantage. CEO's job is to carve out the Existence of Value and create Incentives to Access Value and Barriers to Entry for other corporations, strategy to create earnings are secondary. The reason NIKE pays Tiger Woods millions of bucks is all about Competitive Adventage and Barriers to Entry for Other Corporations. NIKE can not afford not to pay Tiger because if Tiger was exclusively representing another company it would have been a Barrier to Entry for NIKE. Of course Barriers to Entry can be created artificially as Communism and Mafia do it but in a free market one has to constantly create Barriers to Entry, every corporation has to build those structures. Chris Locke's writing at CBO was Barrier to Entry for HighBeam's competition because if another company tried to do a similar gig it would further prove the Value Creation of CBO.
Another point Damodaran reminds me and I am quite amazed that most miss this point is that CEO's job is always to look at Value Creation for Shareholders and not for the Corporation. It's is the Shareholders that put up Equity for the promise of Future Cash Flows. They are the ones CEO is working for. A Corporation does not belong to a CEO, it is not his plaything unless he is enough large of a shareholder and derives most of his income from the Cash Flows stream rather than a CEO's compensation.
Well, ok enough of these thoughts, back to looking for a job.
