Are corporations always wrong to engage with the "grey" market?

 by Martin Belam, 26 October 2006

Sony's engagement with the "grey" market surrounding their games hardware has been in the news a lot over the last couple of weeks. First there was the anouncement that the corporation was intending to do everything possible to keeps the PS3 games console out of Europe until the official launch scheduled for March 2007. Then there were the revelations by the Lik-Sang website that Sony staff in Europe had previously purchased "grey" market Sony products from them. Sony's official line is that the staff purchased the machines in order to help trace the supply route.

The purchasing of PSP consoles by SCE employees would be for investigatory purposes. We would also like to express our surprise at a company releasing personal information about its consumers

It illustrates an increasing problem for corporations trying to restrict their content or equipment to particular regions or rights areas - if you know your restrictions are being circumvented, do you try and ignore it, or do you actively try to understand the consumer experience.

It strikes a real parallel with me for the way that the BBC engaged with the concept of file-sharing television programmes. The first high-profile peer-to-peer leak of a flagship BBC programme was the leaking of the first episode of the revived Doctor Who, 'Rose'. For executives within the BBC to understand how the audience is accessing their content, they need to have used BitTorrent. To understand the scope of digital black market BBC content available to download, they need to have searched across file-sharing services.

The question then is whether you should do those activities using your real name and a company credit card, risking the kind of exposure that Sony has just suffered at the hands of Lik-Sang, or whether you get anonymous minions to do it from home, with much greater exposure to legal risk on an individual basis.

For me, I think if you truly want to understand the end-to-end consumer experience of what could potentially develop into a significant proportion of your market, you need to be engaged with all the avenues of distribution, whether it be physical products or digital content, white, black or grey.

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