The Entrepreneur and Infopreneur

“The Entrepreneur is dead, long live the Infopreneur”

The entrepreneur is dead?! I’m not sure if the entrepreneur is dead however I will be looking at the differences between an entrepreneur and an infopreneur and whether the entrepreneur is still alive or if the future lies within infopreneurs. I will be looking at examples of an entrepreneur and an infopreneur and analysing whether there is a future for each. An entrepreneur is someone starting or growing a business who distinguishes themselves with their innovative ambition and achievement who accepts full responsibility for the outcome of the venture (Parks, 2006). An infopreneur is someone who gathers, organises and displays information on the internet offering a value added service as a business venture in return for a reward. An example of a well known entrepreneur is Sony Corporation. Sony was set up in 1946 by Masaru Ibuka and Akio Morita, two passionate inventors who wanted “to build consumer products that no other company had done before” (Bolton and Thompson, 2004). Throughout the years Sony built upon their knowledge and expertise releasing products, both successful and failing ones. In 1979 Sony released the Walkman, which “changed the lifestyle of a generation” (Bolton and Thompson, 2004), and from then onwards Sony has been going from strength to strength. In 1991 Sony created Sony Music Entertainment, the second biggest recording company in the world. Sony Music Entertainment can be split down into divisions by the label companies they own, for example Columbia Records, Epic Records and RCA Music Group. Sony Music Entertainment signs upcoming artists onto their recording labels and supports them in building and marketing their portfolio. When an artist’s song is released you can buy the physical CD on the high street or online or download the MP3 file by purchasing it from the Sony MyPlay store.

You will also hear the song being played on other forms of media, for example television and radio; this forms a very beneficial form of advertising for the artist’s song which will trigger people to buy or download the song. In my opinion Sony Music Entertainment are very successful at developing artists and releasing their music, as a lot of successful artists have been brought from nowhere, who are signed to one of the Sony Music Entertainments record labels. Buying music online has grown at an incredible pace with over 98% of singles now being purchased as downloads (The British Recorded Music Industry, 2009). In my opinion Sony have now got a lot of increased competition from both legal and illegal downloading on the internet; I will be looking at one of the main competitors for Sony Music Entertainment, Napster since they were re-launched in 2004. I have created the business environment model for Sony, see appendix 1; this identifies that there are several forms of competition including cheaper downloads that are available on the internet, there are also three main competing music agencies – EMI Group plc, Universal Music Group and Warner Music. These music agencies are not major threats as they are all well established companies. Sony are currently selling singles as MP3 files for download for 99p each through the Sony MyPlay Store and iTunes; if customers can find these singles elsewhere on the internet for cheaper then customers will not purchase from Sony. There are a lot of small companies launched over the past eight years to sell/share MP3 files on the internet as 98% of singles are now bought as downloads (The British Recorded Music Industry, 2009).

If customers want to substitute Sony’s MP3 files and physical CDs, they could always listen to the radio, watch the television or watch/listen to the song online. The main customers for Sony are the listeners as they go out to the shops and purchase the physical CD or pay to download the MP3 file to their computer. Another customer is the bands that are signed up to Sony’s recording agencies as they have to pay a management fee. The bands are also classed as suppliers as they are the ones who create the music in return for management, support and sales. Another supplier is the company who create the physical CDs for Sony so that they can be sold on the high street. In my opinion Sony have three main business models – selling digital and physical goods, the marketing model and the procuring model; this is Sony’s chance to market and sell their products. In my opinion Sony’s main revenue model is sales as this is their main form of income from the sales of music; they also have advertisement and affiliate fees creating other sources of revenue.

One of Sony’s main competitors are the infopreneurs who are offering the music downloads on the internet, just like Shawn Fanning with Napster. Shawn Fanning created a piece of software that allowed him and his friends to connect their computers and share the music on them using peer-to-peer technology to move the files from one machine to another; he called this service Napster (Waters, 2009). This service expanded so much that 85 million people around the world were soon using Napster, with a billion searches for music every day. The Recording Industry Association of America sued Napster because the act of sharing music was illegal and after two years of fighting the law case, Napster was closed in 2001 (Waters, 2009). Napster was bought by Roxio in 2003 and re-launched legally in America; in 2004 the service was brought back to the UK (Goldsworthy, 2009). There are around 700,000 subscribers to Napster who can download and listen to music for a small monthly fee. Napster is currently offering five downloads a month and you can listen to over eight million songs online for just £5 a month. You can download your five MP3s to your computer and even through your phone; Napster will send a back up of the MP3 you downloaded through your phone to your computer too.

Napster does not own the music themselves, when a member logs onto Napster the songs on their computer are added to a list of songs currently available on Napster. Only the list of songs is held centrally; the actual files are still stored on the member’s computers and when you request to download a song, it is copied from one member’s computer straight to the other member’s computer. Whilst indexing the files is centralised the actual swapping of files is peer-to-peer. I have created the business environment model for Napster, see appendix 2; this identifies that the main form of competition is other music downloading websites; the main two competitors are Apple and Real Networks. (Hoovers, 2009) Customers may go to these other music providers as they all offer a similar music collection, but others may be cheaper. Napster has similar substitutes to Sony; customers could watch their favourite bands on television, listen to the radio or watch them online. There is also a threat as this is a constantly growing market; for example, in December 2008 Amazon launched Amazon MP3 in the UK which allows you to download over eight million DRM free tracks from 29p each (Amazon, 2008). As Amazon is a huge well known international company customers may be “swayed” into buying from Amazon instead of Napster as they are a well known and trusted company and offer simple 1-Click ordering.

Napster’s customers are the users who pay £5 per month to subscribe to the service where they can download five MP3 files per month and listen to over eight million songs online. Users are paying Napster for the service of connecting them with other users so that they can all share and swap MP3 files. Users can also be classed as suppliers as they are the ones who have the music files and without the users subscribing and offering their music, Napster wouldn’t have anything to offer. Unlike normal suppliers, Napster does not pay users for giving them access to their music files. In my opinion Napster’s main business model is selling a digital service as they provide the community for the members to browse and swap music in return for a small monthly subscription fee. In my opinion they also create a community online as all of the members interact to benefit each other. Napster’s main revenue models are sales, subscription, advertisement and affiliate fees as they continue to run a profitable business by using other people’s data. The main difference between an infopreneur and an entrepreneur is the product/service as the typical entrepreneur offers a physical product, like Sony offering the CD in the high street music stores, whereas an infopreneur will create a value added service which, in the Napster example, allows customers to get the music files. Napster does not actually own any music files, they just connect members together so they can browse, swap and download each other’s files. Another main difference between Sony and Napster is when you analyse the business environment models; Sony’s customers and suppliers are actually providing and receiving physical products.

Whereas Napster’s customers and suppliers are both the users as they browse, swap and download each other’s files; there is no physical product involved. However whilst analysing these two businesses you also realise how similar they are; Sony and Napster are both spreading new and upcoming artists’ music around the world. The main advantages of being an entrepreneur are that it can be rather exciting, especially when setting up the business, as you will be making all of the decisions and taking all of the risks which will excite and motivate entrepreneurs. Another advantage is that you are flexible and independent; you can control when you work and what you do as all of the decisions are your choice. The main disadvantage is that it can be very risky and you may not get a regular salary depending on how the business is performing each month. Some people would see the amount of responsibility you have as a disadvantage as it may be quite difficult to handle all of the decisions, as each major decision will affect the business, and it is very important to avoid unnecessary costs, especially whilst setting up the business. Being an infopreneur is a lot less risky and that is one of the main advantages; you may not have as much money invested in the business as an entrepreneur because an infopreneur will have very low initial set up costs however the important decisions you make will still affect the business.

Another big advantage is the low running costs of an infopreneur, the biggest cost could be your web hosting costs, which is nothing compared to Sony’s costs (Chin, 2006). However once you have successfully set up your website with your products/services you must attract attention to your site, this has to be the main disadvantage, it doesn’t matter how good your product is if there are no customers then what’s the point? (Bolton and Thompson, 2004) You may have to invest in marketing or advertising through other people to get your business venture off the ground. After comparing the entrepreneur and the infopreneur I don’t think the entrepreneur is dead; in my opinion the infopreneur may threaten some entrepreneurs, depending on the market, however entrepreneurs can still survive alongside the infopreneur. For example, Sony were threatened by the introduction of infopreneurs creating music sharing and downloading software, however Sony adapted and can now also offer something similar so that they can survive alongside companies like Napster. In my opinion this is a good example of an entrepreneur that was threatened however they adapted to the changes and as long as entrepreneurs do this I think they will continue to survive.


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The Entrepreneur and Infopreneur. (2017, Jun 26). Retrieved October 27, 2021 , from

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