Posts Tagged internet
Andrew Sullivan linked to Forbes’ Timothy Lee citing a “study” called The Sky is Rising that claims to prove that the entertainment industry is not suffering.
Mike Masnick (who, full disclosure, has paid me to contribute to his Techdirt blog in the past) has a great new study out today about the growth of the entertainment industry. Driven by complaints from a handful of large movie studios and record labels, there’s been a tremendous amount of discussion of the negative effects of the Internet—specifically, illegal file-sharing—on content companies. In a new study funded by the Computer and Communications Industry Association (which frequently locks horns with content companies over copyright issues), Mike nicely illustrates that if you look beyond the largest firms, the entertainment industry is in great shape by almost any measure.
Masnick himself had some very optimistic-sounding words and some impressive-looking statistics to back them up, as well as a pretty infographic to explain what he is saying.
Yet, what we find when looking through the research — from a variety of sources to corroborate and back up any research we found — is that the overall entertainment ecosystem is in a real renaissance period. The sky truly is rising, not falling: the industry is growing both in terms of revenue and content.
This “study” is a great example of why you should never trust people with a clear agenda when they tell you what their research has proven. I took the step of actually downloading Masnick’s “study” and, to be blunt, it’s a load of bullshit.
I’m not sure what makes Masnick think that he is convincing, but he was obviously banking on no one who knows what they are talking about actually reading his study. He has a decent graphics designer, but even any first-year maths/economics student could tell you that his “study” is an extended polemic and not much else. For those of you out there who have never studied in this field, here’s a few of the many reasons why you should not trust a word in The Sky is Rising (aside from the fact that it’s called that, obviously):
According to who?
Take a look at this:
More recently, the movie industry has also been dubbed recession proof, due to the box office ticket sales that have held up rather well in comparison to other industries. In 2008, DreamWorks Animation CEO Jeffrey Katzenberg said, “Both traditionally as well as recently, we have seen that our product is, at worse, recession-resistant and, more optimistically and historically, has actually been recession-proof.” Additionally, according to the MPAA, total worldwide box office ticket revenues have increased by 25%, from $25.5 billion in 2006 to $31.8 billion in 2010.
According to PwC reports that include movie revenues beyond just box office ticket sales, the film industry has grown worldwide by almost 6% over the five-year period from 2005 to 2010, exceeding approximately $82 billion in value. For an industry that claims to be plagued by piracy, this steadfast level of growth during the Great Recession appears to justify the boastful statements of being recession proof.
The “PwC” referred to is presumably international accounting firm Pricewaterhouse Coopers, the issue here is that the “study” has not even said this, let alone provided a way to see the PwC data. What we do have is a nice-looking chart that doesn’t really say anything.
But wait, what about ..?
We can intimate that we are seeing the MPAA box office revenues from 2006-10, but there is a lot of information missing:
- Obviously, the US market has been quite stagnant while the international market has been steadily growing, why is that?
- Where has the growth been? We are told that other countries have high ticket sales, but not how they changed over the same time period.
- How have films been doing relative to the wider world? (i.e. if Nigerian films are booming, is that a sign of films doing well or of Nigerians doing well?)
Other films that deserve to be mentioned are independent films that don’t generate mainstream box office ticket sales. In 2011, the Sundance film festival received around 4,000 entries, and independently-financed films are being produced with renewed vigor as production costs have dropped.
- How have production costs dropped? What are these costs? What were they before and what are they now?
- Why don’t “independent films” achieve box office sales? Obviously they achieve some, how many do they actually get and why is it so much less than “non-independent”?
- For that matter, what do you define as “independent”? Does that include everything outside of the major US studios? Does it exclude big Bollywood productions?
Oh, it’s obvious is it?
Probably the biggest error that Masnick makes repeatedly is that he simply states facts that are “clear” without any evidence to substantiate them. I have picked a few examples out, but this happens again and again (emphasis added):
In 2001, Forbes published an estimate that assumed around 13,000 video releases were created every year and pegged the entire US porn industry to be valued at less than $4 billion. The widespread piracy of these types of movies is putatively ubiquitous, but despite this copyright infringement, predictions for the demise of the adult film market seem to be dismissed easily, given that the demand for adult entertainment seems to be going strong.
It “seems to be going strong”??? According to who? You can just “feel it”? Because the people making the movies definitely seem to think that their industry has taken a massive hit and, by the way, this has led to a competition to see who can be more “extreme” in order to capture the shrinking number of guys who actually pay for porn. This “fact” needs to have some substance, i.e. “which seems to be growing strong, as we can see from the increase in sales reported by [x]”.
Similar for these:
However, outside of advertising budgets, consumers are still willing to subscribe to television services in significant numbers even when free over-the-air broadcasts are widely available.
… These digital distribution methods for movies and shows are still in their infancy, but the convenience for viewers creates valuable services — which appear to be in growing demand as traditional television networks are beginning to provide their own online video strategies.
… A TV show or movie can be produced for a fraction of the cost compared to a decade ago, so many more kinds of shows can be developed with less risk.
What are these “significant numbers”? What is the demand for digital distribution? What fraction of the costs of a decade ago is production at now? This is actually a nice segue into my next point:
Volume published doesn’t mean anything
“Production costs” are relative, but what have undeniably dropped are distribution costs – mostly because they have gone from something (i.e. the cost of creating a physical product to distribute) to nothing (the cost of distributing a digital file). As a result, the volume of units has increased dramatically in film, publishing and music. This does not say anything about the number of people watching them or, most importantly, their quality (I have already argued that the quality of music being produced has been declining recently).
Here’s Masnick’s take:
With the cost of both production and distribution falling dramatically, different options for watching movies are more widely available than ever before, which creates an environment where a low budget film can potentially become enormously popular. Examples like Paranormal Activity, The Blair Witch Project and El Mariachi might be rare, but they also demonstrate the very real possibility for moviemakers to produce incredibly profitable films without a $200 million budget. There may be some exaggerations regarding movie budgets, but memorable (and profitable) storytelling doesn’t necessarily require an Avatar-sized budget.
Here are some numbers for you: according to IMDB, these three films, released in 2009, 1999 and 1993 have grossed $444,045,819 to date with combined budgets of $295,000 (most of which was for El Mariachi). Avatar, on the other hand, had a budget of $237,000,000 but grossed $2,782,275,172 in two years. Even factoring in the budgets, Avatar grossed six times as much in two years than those three films did in a combined 35.
What does this say? Whatever you think about “memorable storytelling”, Avatar-style productions are immensely more profitable than their smaller, cheaper counterparts and a lot more people are willing to pay for them. If the movie industry can no longer produce the Avatars of this world, that is a problem.
Now here’s where piracy comes in: people will not be thinking long-term about the problem because we inevitably choose short-term rewards (watching Avatar for free!) over long-term ones (more Avatars being made) – see hyperbolic discounting. Ultimately, however, if we all stop paying to watch Avatar there will not be another James Cameron movie made ever.
… The line between amateur and professional video is even becoming difficult to define, as the children from the viral video “Charlie Bit My Finger” have gone on to become minor celebrities — earning enough income for Charlie’s family to afford a new house.
The Business/Media section of today’s Australian had a special cover page dedicated to heralding the next step in television through IPTV (that’s “Internet protocol television”).
FOR more than half a century the humble television has commanded the attention of millions of families around the world. Yet despite our inextricable attachment to the box, the complaint that “there’s nothing on TV” has persisted for just as long.
The days of those complaints and the one-way nature of the television are numbered as the ubiquity of high-speed internet access ushers in a new era of a more connected broadcast medium through the adoption of IPTV, or internet protocol television, a technology that streams television and video services via the internet direct to your computer, TV or game console.
This all sounds great, but should hardly be coming as a newsflash to… well… anybody. The beginning of the last decade saw the music industry almost collapse as file-sharing technology and increased download speeds made it possible to share and download music across the globe for free.
Yet it was still somehow a shock when the exact same thing happened to the TV and movie industries. Somehow, during the whole experience that the music industry went through, it did not seem to register that they may need to start re-thinking their distribution models.
In fact, it seems like they still haven’t done that.
The (pretty mediocre) interactive guide that The Australian put together is far too generous to the existing TV providers, aside from the ABC, who are genuinely embracing technology in an effective way. As for Foxtel:
By far the most comprehensive offering but also the most expensive. It will be interesting to see how Foxtel heads off the likes of FetchTV, Optus MeTV and Quickflixs who are increasingly making inroads on their territory.
Well, they got one thing right, Foxtel are the most expensive. Most comprehensive though? Not quite. Here’s the biggest problem that none of the coverage recognised: the most comprehensive offering is the entire Internet.
The reality is that anyone with a computer and a half-decent broadband connection (the best kind available in Australia, unless you have the NBN, in which case you can add “exorbitantly expensive connection”) can watch almost any TV show or movie that has ever been made in HD whenever they feel like it and for free.
There is no reason to subscribe to the overpriced Foxtel monopoly when there is a better service being provided free-of-charge. Meanwhile, Foxtel has added the ability to record shows on IQ, as well as some pay-per-view movies and a piss-poor catalogue of online downloads, all of which barely amount to any effort to compete with online services.
The main issues are still there:
- Aside from the extremely limited “Foxtel downloads”, customers are confined to the single TV that is connected to the giant Foxtel set-top box through a wall outlet.
- Customers are completely restricted by what Foxtel thinks they should be watching at any time, unless they have recorded a series as it airs onto a very limited hard drive or they want to pay extra on top of their $100 per month subscription for a pay-per-view movie.
In other words, Foxtel are charging more money for a worse technology.
No company is in Australia is yet providing the business model that would work: a subscription-based service allowing a certain number of hours of viewing depending on your package and providing as comprehensive a library of on-demand viewing as possible. For anything besides live TV, there is simply no reason for a distributor to dictate when their customers can and cannot watch a particular show.
If Foxtel in particular does not start updating its product soon, it will be gone in a matter of years. The industry as a whole needs to seriously wise-up before it gets defeated by progress.
Personally, my eyes were glued to a combined Balkan Beat Box and Infected Mushroom show being streamed live from Tel Aviv, which was amazing. It looked like one of the biggest performances I’ve ever seen and while obviously I had huge FOMO for not being there, at least I could have some idea of the experience, due to amazing advances in the internet and video streaming. Although Infected didn’t play much of their early work, which is their best in my opinion. They seem to be transitioning from the world’s number one psychedelic trance outfit into some kind of Linkin Park clone, but luckily they aren’t there yet and still put on an extremely impressive show.
That said, according to my Twitter and RSS feeds, everyone else was watching Hosni Mubarak not resigning. Luckily, the whole transcript was online, so I know what I
didn’t missed. Here are the highlights:
Our priority now is to facilitate free election – free presidential elections and to stipulate a number of terms in the constitution and to guarantee a supervision of the upcoming elections to make sure it will be conducted in a free manner.
…This time is not about me. It’s not about Hosni Mubarak. But the situation now is about Egypt and its present and the future of its citizens.
See? It’s not about him! He doesn’t have to resign, it’s just about facilitating democracy!
He even went on to tell everyone what a good, patriotic guy he is:
I was a young man, a youth just like all these youth, when I have learned the honor of the military system and to sacrifice for the country. I have spent my entire life defending its land and its sovereignty. I have witnessed and attended its wars with all its defeats and victories. I have lived during defeat and victory.
But apparently he did relinquish some power…to his newly appointed Vice President Omar Suleiman, also the head of his brutal secret service, which he has used to oppress any opposition for the last 30 years. What a generous dude!
Apparently Suleiman told everyone that it’s ok and the protests are just Al Jazeera’s fault. Sounds reasonable, right? Anyway, back to Mubarak:
I have delegated to the vice president some of the power – the powers of the president according to the constitution. I am aware, fully aware, that Egypt will overcome the crisis and the resolve of its people will not be deflected and will [inaudible] again because of the – and will deflect the arrows of the enemies and those who [inaudible] against Egypt.
Now, I’m not Egyptian, but I have a feeling that the protestors were not quite satisfied with this whole thing. You see, I feel like contrary to Mubarak’s apparent sentiments, this whole thing really is about him. In fact, apparently the protestors didn’t take so kindly to the speech…at all:
People silently held up their shoes in disgust, and a great rallying cry “Leave! Leave! Leave!” went up. I have never been in a crowd wracked with such intense emotion. After he finished, men wept openly while their friends consoled them. There was rage and screaming and shock. People could hardly find the words to voice their frustration. “It is promises in the air!” “He wants to keep his military honor!” “He cannot imagine that his people are telling him to go.” People shook their heads and looked up to the sky as if for some answer. One woman told me with a cracked, inchoate voice: “I’m angry … we’ve been waiting for years … wait until September? And he’s sorry!” she spat with sarcasm. “It’s too much! Sorry is in actions, not words. It’s the same old story. It’s no change. We’re just running in circles.”
Huh, guess he wasn’t as convincing as he hoped.
That said, there is some sense in what he’s doing. One Tweet that came-up on my feed sums this up pretty well:
You see, emotions run high in protests like these, but as Middle East guru Daniel Pipes observes, democratising a country requires a huge shift in culture and infrastructure and can take decades, it won’t happen overnight. So the current regime does need to hang around, at least for a while.
There have even been suggestions that the army is allowing these protests to continue because the military leaders had grown tired of Mubarak and did not want his son taking over. This was supported by an announcement yesterday that Mubarak was transitioning power to the army. Even if Mubarak is eventually forced out, this scenario would spell more of the same for Egypt in the foreseeable future. I guess only time will tell.
Images from this photoessay from The Atlantic.
The AWL’s Choire Sicha made a good observation about the internet:
2 Girls 1 Cup took the web by storm—back in summer of 2007. Goatse—the infamous picture that first gaped at us in 1999!—has been popular and not popular in waves over the years since, but the last few years? Not so much. Whatever happened to Tubgirl and Eel Girl? (If you have never seen these things, worry not!) There was also, a few years back, some website that was supposed to be the future of the Internet, devoted to tabloid play of death and destruction video. Now I can’t even remember what it’s called and can’t even Google it up….
What happened? The Internet was great at being a foul cesspool of shock, but it looks like that’s over now.
Her answer is that since everything’s become more professional and most of the “hub” sites are owned by “grown-up” organisations like AOL and the Huffington Post, everything is self-censored and material like tubgirl just doesn’t spread like it used to.
The enjoyable and more mainstream websites that propagate meme-related stuff on the web, like Urlesque (currently most-popular: Cab Driver Does Spot-on Michael Jackson Impression) and Buzzfeed (most popular:Top 10 Crazy Texts From Parents), are actually grown-up entities and can’t and won’t handle actual shock material, as seems quite correct. (One is owned by AOL; the other is the team behind the Huffington Post.) And so there’s really no one left to identify the next famous Brazilian lesbian scat porn trailer and force it upon its non-intended audience.
I think there’s a point here, but I also think a big factor is the migration of social interaction from messageboards and chatrooms to sites like Twitter and Facebook, as well as the takeover of…life by Apple. You see, forums didn’t really moderate for material like this and it was very easy/funny for someone to post a picture to a whole bunch of random people who they didn’t know and then sit-back and laugh at the reactions. These new social media giants can restrict certain links and the whole process is made much more difficult by the fact that you are no longer an anonymous screen name, you need a whole extensive profile that takes a lot of time and effort to build and can be traced back to your real identity.
Add to that the fact that Steve Jobs’ own morality prevents any inappropriate material on iPhones and iPads and seeing shock sites is becoming harder and harder.
I do agree with Sicha though, while it’s obviously pleasant to not be watching a video of a jar breaking…inside some guy, there is a certain charm that the young internet had that all this growing up has caused it to lose. Sad…
The Labor government is betting its $36 billion National Broadband Network can only be built by government and must rely almost universally on a fibre optic network.
But last month US President Barack Obama in his State of the Union address went in the reverse direction, promising the American people a nationwide wireless network among other technoligical solutions built by the private sector. The question is does Obama know something Communications Minister and NBN champion Stephen Conroy does not?
Obama is constantly being attacked in the US for implementing some kind of socialist regime, which is why it’s funny to compare his broadband scheme to the one currently being pushed by Steven Conroy and the Gillard government. As outlined by Mitchell Bingemann in today’s Australian, Obama’s plan involves auctioning-off airwaves previously reserved for analogue TV and government service and then providing subsidies for broadband to be implemented by private industry, with some funds specifically for extending broadband to remote communities. Most importantly, he isn’t restricting the kind of technology to be implemented – it can be anything from fibre to 4G wireless. The cost of the whole thing ? About $7.2bln.
Compare that to the Australian plan. Our government wants to roll-out the most expensive technology out there to every home in Australia, creating a centralised monopoly wholesale operator at a cost of $36bln and taking 10 years to complete, which in the technology world is several lifetimes. To compare, that is $24 per American vs $1600 per Australian. As Ian Martin observes, also in today’s Australian:
More important, President Obama chose to support wireless broadband over fibre access because it has more to offer. Bearing in mind that the backbone of wireless networks is typically a fibre core, it’s wireless broadband, not fixed broadband, that is growing with advances in wireless network capability, wireless devices and applications. Obama’s firefighter is downloading the design of a burning building on to a handheld device, not knocking on a neighbour’s door to plug a laptop into the local fibre network. In fact, they would probably download it in the fire truck on the way to the building.
Cisco, a network equipment provider, has forecast that Australia’s monthly mobile data traffic will double each year in the next five years, a 32-fold increase as wireless broadband grows. That is about 150 petabytes (or 150 million gigabytes) a month, the equivalent of 16 text messages per person every second.
Ericsson, another network supplier, has recently demonstrated peak mobile download speeds of 168 megabits per second on existing network technology, although it would require new consumer handsets. That’s four to eight times the peak download speed offered by Telstra’s NextG network at present. It’s likely that peak mobile speeds will be greater than the 100Mbps offering over NBN Co before it has even met 10 per cent of its rollout target.
Even if cable broadband is the absolute best and fastest technology out there and will be for the next 50 years, which may be the case, I am in no way convinced that every single household in Australia needs it. There are definitely benefits to providing broadband to rural Australia, so too with implementing a cable broadband network between hospitals and schools, to allow better healthcare and education in remote areas; but can’t we find a cheaper way to connect some people? Why do they all need 100Mbps?
It also is just folly to put all of our chips down on one technology at a time when communications technology has a massive revolution every few months and is barely recognisable from year-to-year, especially when everyone seems to be going 3G and 4G technology is in the pipeline. No one can doubt the importance of broadband, but an infrastructure project this size needs to be far more carefully considered and its extent needs to be weighed more thoroughly, there’s no reason why we have to be “all or nothing”. The American plan is supporting market forces and innovation – companies will be competing to provide a cheaper and better service and the technology with the highest demand (i.e. what the American people most want) will be the most common. We are getting an expensive service, whether we want it or not. If America is becoming Sweden, Australia is becoming China.
And it’s not like we have nothing else to spend the money on – when a country our size has such poor roads, no high-speed rail, no inner-city metro systems and such bad water infrastructure, should broadband to every home really be the top priority? I am very worried about the whole policy to be honest, it seems very rash and excessive.
As observed quite well HERE, the internet’s number one appeal these days is that it makes people feel important. Like talkback radio on steroids, the web lets any idiot with a keyboard and an opinion get airtime that they could never have even dreamed of before. Morons can connect with each other from across the globe and pat each other on the back for making stupid pictures of penguins with subtitles. Want an example? The “Bed Intruder Song” was the most highly viewed youtube video of last year and the number one comment is:
“THIS VIDEO HAS NOTHING TO DO WITH JUSTIN BIEBER, JUSTIN BIEBER IS GAY SO QUIT TALKING ABOUT HIM THIS IS NOT HIS VIDEO, THUMBS UP FOR ANTOINE DODSON CAUSE HES THE BEST”
That turd has been read by millions of people – something like that would never have happened even 5 years ago. Hell, the whole blogosphere was built by people who think they have something to say (besides me, my opinion really does matter, obviously). As that Paul Ford post said:
To read a book people will turn to their phones. But the web is where they will go to complain.
In The Man Who Spilled the Secrets, Vanity Fair’s Sarah Ellison details the relationship between Wikileaks’ Julian Assange and the mainstream media, particularly the Guardian. This really illuminates the difference between the internet’s “free-for-all, everything counts” philosophy and the more traditional media’s quality-controlled approach.
The Guardian, like other media outlets, would come to see Assange as someone to be handled with kid gloves, or perhaps latex ones—too alluring to ignore, too tainted to unequivocally embrace. Assange would come to see the mainstream media as a tool to be used and discarded, and at all times treated with suspicion…
The biggest gulf between WikiLeaks and the traditional news outlets lay in their approaches to editing. Put simply, WikiLeaks didn’t have one, or believe in one. “Neither us nor Der Spiegel nor The New York Times was ever going to print names of people who were going to get reprisals, anymore than we would do on any other occasion,” says David Leigh. “We were starting from: ‘Here’s a document. How much of it shall we print?’ Whereas Julian’s ideology was: ‘I shall dump everything out and then you have to try and persuade me to cross a few things out.’ We were coming at it from opposite poles.”
As the article says, the Guardian is probably considered more of a rogue (i.e. lower reporting standards) than most large newspapers, and yet there was still a huge gulf between their mentality and Assange’s. Assange’s has also been changing over time – he is becoming more and more aware that it actually is important to filter what is published and that there are repercussions to putting certain things out there.
This is exactly the problem with the internet being the way it is – with no quality control anywhere, very dangerous opinions can be spread fairly easily. For example, a whole series of terror attacks have been linked to American/Yemeni clerid Anwar al-Awlaki – most recently, the attempted stabbing of a British MP by Roshana Choudry. The terrorists’ whole ideology came from online material, as did their contact with Awlaki, who eventually convinced them to attack.
Not that I’m comparing Awlaki to Assange at all, but doing something as significant Wikileaks does requires some level of responsibility. Either way, it seems to be catching up with him – as the article notes:
Through December, WikiLeaks still wasn’t collecting new documents from potential whistle-blowers. The site is crowded with pleas for donations. “He is short of money and short of secrets,” someone who has worked extensively with Assange told me. “The whole thing has collapsed.”
The final take-home point is the Guardian‘s motto, which I have never read before but now love. Opinions are always going to be up for debate, but it’s the facts in the end that will win the day. That is why these stupid conspiracy theories about Israel are so crazy and why Wikileaks in the end probably wasn’t the worst thing to ever happen. Through all the stuff that probably shouldn’t have gotten out, we did find out that, despite a little dirty laundry, in general the US, Australia, the UK, Israel and other such nations pretty much make their views and agendas public, whereas other countries completely do not (Saudi Arabia, I’m looking at you). I’d love to see what the Iranian diplomatic cables would look like…
Scott outlined the paper’s principles in a centenary editorial on May 5, 1921, in which he put forth what has become the paper’s motto: “Comment is free, but the facts are sacred.”