Business Models for CC Licensed Works

CC licenses encourage free and legal sharing, reuse, repurposing, and remixing of creative works. Choosing a CC license for your work, however, does not necessarily mean forgoing an opportunity to make money. In fact, CC licenses have become an important part of many online revenue models that are emerging as internet platforms grow and develop.

There are several ways creators can use CC licenses as part of their business models:

• Use CC licenses to sell yourself, not your product. Many creators today target smaller, more specialized markets. Freely sharing products under CC licenses becomes a way to promote themselves and their brand, increasing their audience base and product distribution. The more fans you have, the more likely you are to make money.

• Use CC licenses to connect with fans, then give them a reason to buy. Openly sharing creative work allows the audience to actively engage with it, thus helping to build a relationship between the creator and the fans. Creators can then generate revenue by charging for premium versions of their product (e.g. deluxe editions or hard copies) or related goods (concert tickets, t-shirts, etc.).

• Use advertising alongside the CC-licensed product. An advertising-based business model relies on as many people as possible seeing your work. So the wider your distribution, the more money you make.

• Use commercial licensing arrangements in parallel with releasing a product under a CC license. Using a CC license to raise the profile of your works can lead to commercial opportunities. CC-licensed photos and music, for example, are regularly picked up for paid uses by publications, films and advertisements.

• Use crowdsourcing to fund, and earn profits from, CC-licensed works. Crowdsourcing is an increasingly popular way to fund projects, and CC now even has its own page on Kickstarter, the popular crowdsourcing platform.

Case Studies

The benefits of incorporating CC licenses into business models for creative works are illustrated by the following case studies.

• Dan Bull is a British rapper who has leveraged the tools offered by CC to generate viral marketing for his work. He released his single Sharing is Caring commercially while also making it available for free download under CC0, a tool that dedicates a creative work to the public domain. The song reached #9 on the UK Independent chart and #35 on the UK R&B chart.

• Cory Doctorow is a science fiction writer who has used the CC BY-NC-SA and BY-NC-ND licenses for his books. Releasing his books under CC licenses has helped Doctorow promote himself, expand his readership and increase his book sales. His CC-licensed books have consistently outperformed his publisher’s expectations, with Little Brother spending four weeks on the New York Times best seller list.

• The Nine Inch Nails Ghosts I-IV album generated revenues of $1.6 million in its first week of sales even though it was released under a CC BY-NC-SA license and a quarter of the album’s tracks were available as free downloads. NIN’s Trent Reznor has relied on the “connect with fans + reason to buy” model, giving fans the ability to remix and redistribute the work, while generating revenue through sales of a reasonably-priced CD, deluxe edition packages, and concert ticket sales. Read more about NIN Ghosts I-IV.

• Sita Sings the Blues is a CC BY-SA-licensed animated feature film from Nina Paley, who chose CC licensing in order to reach the widest audience. Even though it was freely released online, the film brought in $55,000 in revenue in the first nine months through donations from appreciative fans, sales of film-related merchandise and DVDs, and theatrical distribution.

• Cafuné is a Brazilian feature film by debuting filmmaker Bruno Vianna, who sought a wider audience. The film was simultaneously released in theaters and online under the BY NC-SA license. The release included two versions of the film, each with a different ending. Furthermore, the CC license enabled the audience to create their own endings to the movie. This resulted in a spike in downloads of the film, which was followed by a significant increase in the number of theater-goers.

• Flat World Knowledge is a commercial higher education publisher that uses the CC BY-NC-SA license for its textbooks, allowing them to be adapted for individual courses. The company offers free and customizable access to textbooks online, but charges for hard copies and downloadable customizations. The company’s open textbooks were used by 800 colleges in 2010.

• Unglue.it is a new crowd-funded project to turn individual, already-published books into freely-shareable ebooks. To release the CC-licensed ebooks, Unglue.it first buys the rights from the copyright holders. To that end, Unglue.it works with rights holders to decide a fair price for compenstion and runs fundraising campaigns to raise the needed amount.

• Jeremy Keith took a photo of the Kennedy Space Center’s Vehicle Assembly Building in Cape Canaveral and posted it on Flickr under the CC BY license. A studio representative spotted the photo and wanted to use it for the blockbuster feature film Iron Man, but could not include Jeremy’s name in the credits. Jeremy used the CC+ protocol to license the photo commercially outside the CC BY license, enabling its use in the movie.