Thursday, August 24, 2006

BBC NEWS | Programmes | Click | Film piracy: Is it theft?

BBC NEWS | Programmes | Click | Film piracy: Is it theft?

A wonderful two-headed interview (not a debate, since the interviewees are in different places) about art, technology and business today. The video feed can be watched at

Dan Glickman of the MPAA sticks to the ignorant caveman definitions and uses of the words "theft" and "piracy" as commonly applied to intellectual property rights and technology today. He seems to be ignorant of the entertainment industry's own successful processes that compete with "free."

John Perry Barlow smartly and soberly (hmmm, he wrote lyrics for the Grateful Dead) provides clear examples of how he has prospered from "free" (his example of the Dead's blanket permission for their fans to tape and distribute concerts). His scathing point that the entertainment industry is peopled by men who are older, less flexible, and less smart that the average young consumer today, and the industry must adapt.

The industry should have adapted ten years ago, yet they collectively cry like babies and misdirect attention to make up for the fact that their share of the entertainment pie does not continue to grow exponentially, all while consumers and artists are not being served.

The music industry, from the rise of Rock 'n Roll and the LP record, and the movie industry, from the birth of the summer blockbuster and the home video market, have prospered and found brilliant ways to provide less value to consumers and less compensation to artists. The entertainment industry, and perhaps more importantly our artistic culture, will never truly prosper until this gets turned around, with consumers receiving far greater quality and value and artists (in both broad and deep ways) receiving far more support and compensation for their work.

Tuesday, August 22, 2006

Tower files Chapter 11, seeks buyer

Tower files Chapter 11, seeks buyer

Simply no surprise. Simply an example of a top-heavy public company that hasn't managed to figure out how to turn a growing-profit in a changing market. Not necessarily a sign of impending doom for the music industry.

I don't think that a packaged music format, something that people can pick up, feel, and pay-for at a cash 'n wrap, will at some point cease to exist. I do believe that we have seen the last successful disc-based format (at least I hope so). SA-CD and DVD-A (including its cousin DualDisc) were tremendous improvements over CD, sounding better, providing high-resolution and surround music capabilities, having limited video capability (for DVD-A), containing backwards compatibility, etc., yet in a non-rush to market these properly, the music industry let them become a failed experiment. New formats Blue Ray and HD-DVD can be described with the same advantages over CD, yet unless the music and video industries can quickly come to their senses, both formats will go down in flames.

There are other ways to distribute content. I hope that the physical medium will have no moving parts. Flash memory is getting denser, more robust, and cheaper every day, but it probably has limitations that will prevent it from getting as cheap per storage-unit as current magneto-optical systems. Spinning discs were from day-one an anachronism, designed from hearts raised with the romantic notion of spinning vinyl, and even in the late-'70s not the only choice for dense data storage. The Sony/Philips hegemony of patent rights, replication facilities, and constant hardware upgrade and replacement cycles has been very effective to them but it has held-back media technology by decades. Whatever way the planet spins toward for physical content distribution, I hope that we see the light before a spinning disc or (hard drive) platter is chosen.

The People have spoken (and have been speaking for a decade) - they download and trade files of audio and video content. It's just plain natural for us to have a (currently) open communications system like the internet and share what we can. Certainly a one-to-many hobbled system like iTunes is one way to generate revenue for copyright holders (hopefully to creative artists), albeit a limited hierarchical one. The browsing process at the iTunes store can be replicated in a retail brick 'n mortar environment, possibly with technology that lets us listen to anything in the store beyond the primitive listening stations, relatively unchanged since the 1950s; browsing through a stack of CDs at Tower, we see something we like (the visual will continue to be very important) and pick it up. What if the music on this music-carrier immediately started playing in our earpiece tethered to our cellphone, and we could add this to a playlist for download, add the physical album to our shopping cart at the cash 'n wrap (perhaps to be replicated, printed, and shrink-wrapped on-the-spot!), or to a save-for-later list? This could satisfy both our urges for immediate-download-gratification and hunter-gatherer instinct directing us to take home a trophy (the shopping gene, common to men and women!).

Why isn't Tower at every live performance? Set up a small shop selling the artist's (and related artists') CDs, offering on-the-spot downloads to phones and iPods, selling instant CD-Rs of tonight's shows, sharing profits 50/50 with the artist? This works at every level of the music industry, from opening acts at local clubs to sold-out U2 arena shows.

Some say iTunes etc. is pushing us toward a singles-market instead of an album market, but in the century of music distribution, we have seen this cycle a few times - after the height of the 78 RPM album in the '30s, and again in the album-oriented '70s and '80s. These cycles should be looked-upon as a refresher for the industry, not as a coffin-nail in an industry.

Some say Tower's biggest challenge comes from Wal-Mart, Target and Circuit City. This may be so currently, but again people forget recent history. Most people, through Rock 'n Roll era, the Hi Fi boom, and the rise of the LP record and CD, bought most of their discs at Sears or J. C. Penney, at rackjobbed sections of the store. These sections carried only the hits, but they replaced what was sold, and could be depended-upon to have popular stuff at a reasonable price, close-to-home whether you lived in Manhattan KS or Manhattan, New York, NY. A specialty retailer like Tower will always sell the hits, but what differentiates them from the mass-marketers would be depth of catalog. Unfortunately since mass-marketers (including internet-based retailers) often look at music and video products as loss-leaders, drawing people to their stores to ultimately purchase more-profitable items, Tower has had to increasingly charge higher prices than mass-marketers and is looked-on as a high-priced alternative. The record labels should have recognized Tower's worth and found a way for them and other specialty retailers to prosper in the face of mass-market competition.

And don't get me started on independent record stores. The major labels had essentially booted the indies by the early '80s by refusing to sell direct to them. A linear decline in independent store success continues to this day. Successful indies, I guess Amoeba would be the poster child, could concentrate on depth, scale, and vibe, while using tools like live performances, trade in used product (at-best a wash for the music industry, trading actual sales for marketing value), etc. And Starbucks would have to qualify as a successful indie record store chain, exploiting their captive, homogeneous audience with very focused custom product.

Tower has a lot going for it if it wants to survive as an independent entertainment retailer - a known name, refined distribution mechanism (if they haven't fatally poisoned this stream by not paying their suppliers), physical locations probably still with good locations and affordable leases, etc. If they can show that they can adapt, and in-fact lead, they can choose to prosper.

Saturday, August 19, 2006

US Democrats compress presidential calendar | US News |

US Democrats compress presidential calendar | US News |

I'm not a member of a political party.

I have never been a member of a political party, I probably never will be, but I kind a wish that there was a party to which I would like to be invited. Am I missing out of some fun?

Belonging to the Republican or Democratic party these days is sort of like being a fan of a Major League Baseball team. You might get interested by one or two players or strategies, but these things by their nature will change every few years. You then stick through the winnings and losings because you're comfortable, because you know where the cleanest restrooms are, because, well, they're still in the game, aren't they?

It's particularly present in the Republican party these days - a Lincoln, T. Roosevelt, or even a Goldwater Republican wouldn't recognize the party today. The majority of the tiny minority that keeps the barely-conservative current administration in power hardly understands what the elite plans for these what's-the-matter-with-Kansas crowd. The current Rove-army is very smart at getting their people elected largely against the self-interest of many of the people who vote for them.

If the Democrats wantopinioninon, they should not take subtle strategic moves like these movements of primaries. They should require a primary, with common rules, in each of the fifty states, on the same day. Let's pick May 15.

That gives six months for their nominees to campaign - well enough. It gives the national party less influence on any one state, but I'm sure they will allocate engery, time, money, money, money, to the states where their efforts will produce candidates that will influence the national election, (did I say money?).

Let's say the Republicans do this too. In 2008. A six month presidential election. Let's say they agree that the six months will be spent with at least one joint appearance in each of the 50 states, in a large public facility, with full media coverage (every radio and TV outlet will carry this in the local area). Two presidential candidates talking to each other - discussing, debating, maybe estrategiczing, in front of a non-cherry-picked audience that would be seeing the same show, without filters.

I must say that a candidate with the obvious lack of appropriate knowledge communicationsions skills as our current president would never have made it through this process. Wouldn't you agree?

Tuesday, August 15, 2006

Recall Ahnold? Maybe, but at Least Vote in Your Own Best Interest

Once again, California is a laughing stock because we elected an actor as governor. History isn't kind to our previous experience with this, and look at the squirmy leftovers from the Reagan administration currently working in the GWB administration, how well their policies have treated you, and how popular they are. Many of us may have felt a certain need to get Gray Davis out of office, but what is the price we are paying for the recall frenzy?

If you still are of the belief that Davis deregulated the energy industry in California and caused rolling blackouts, or that he tripled our car tax, do a little more research. These things were put into place by Republican Governor Pete Wilson, a meaner and grayer Gray. Wilson is not a stupid man, but deregulation and tax cuts as an ideological tactic were all the rage, and apparently the majority of us bought into this despite the fact that most of us would never benefit - short term or long - from these ideas as implemented to buy the votes of the wealthy and powerful.

A great source for information might be the book and movie "The Smartest Men in the Room" about the rise and fall of Enron. The traders at Enron and other companies had found ways to game the power distribution system in California to their financial advantage. As long as a resource or utility is being traded, someone will find a way to profit - these guys just used their corporate influence (including a long-standing relationship with the Bush family and those currently in-power in the White House) to take this profitability to a new level, without regard to the effect on the California energy market and Californians in-general.

In 2001 the state suffered rolling blackouts January 17-18, during the time of year when California typically used the least electricity. Davis bought power at highly unfavorable terms on the open market, since the California power companies were technically bankrupt and had no buying power. The "Smartest..." writers report their conclusion that, while he stood his ground for a while, Davis eventually capitulated to the terms set forth by the bankers controlling energy interests so he could secure his financial position for a possible presidential run in 2004; I can't see this, since his political support and popular poll number was at this time very low.

In April of 2001 Arnold Schwarzenegger meets with Bush political advisers to discuss whether the actor should run for Governor of California in 2002. Karl Rove says "That would be really nice. That would be really, really nice."

On May 17 2001, Schwarzenegger met with Enron CEO Ken Lay, Michael Milken, and 12 other California Republicans at the Peninsula Hotel in Beverly Hills. There they share (according to Enron emails) "an insider's conversation of what's going on with the energy situation." Later, during his campaign for governor, Schwarzenegger claims he is unable to remember anything about the meeting, including whether he even met Ken Lay.

In early 2003 an effort to recall the unpopular Davis, funded largely by the black-hearted and covetous Darrell Issa, began. When Schwarzenegger threw his hat in the ring, the Republican party (not yet suffering from record-low poll numbers nationally themselves) knew they had a chance and threw their support behind him. Schwarzenegger blamed Davis for the energy crisis, for the end of the VLF Offset signed - with a sunset clause - by Pete Wilson, and for spending too much time in office raising political funds. Thus, Davis was replaced in this recall, based on this pack of lies.

Davis may not have led effectively in the energy area, but no reasonable person can disagree that the game was rigged against him on international, national, and statewide levels. What's funny is that the pricing that Gov. Davis agreed to with his back in a corner in 2001 actually is saving Californians today, since energy prices have since skyrocketed. One of the largest interests supporting the Schwarzenegger campaign was car dealerships, funding the spread of lies about the VLF Offset, and Schwarzenegger paid them back by holding a political rally at a car dealership in the San Fernando valley at taxpayers' expense, signing bills taking away existing consumer rights in automobile transactions. And since his election, Schwarzenegger has spent a record amount of time raising a record amount of political money, far exceeding Davis' best efforts.

Aren't Arnold's actions in that recall effort enough to convince any California resident that he was the wrong choice? Our constitutional recall provision is not bad in-itself, but shouldn't we save it for truly criminal actors and punish ineffective leaders in elections? Gov. Shwartzenegger's ineffectiveness as governor, his misguided and costly special election effort, and low current popular support should speak for themselves.

Let's vote for our own interest in November, and put this Experiment in Arnold back where it belongs.

Friday, August 04, 2006

Estate Tax on Minimum Wage Bill? It's a tax on the Death of Common Sense!

Other than in some bizarre world of state-supported class warfare, the recent (and recently defeated) bill teaming a Minimum Wage hike with cutting the Estate Tax was politics at its lowest.

We're all suffering because of the disparity between poor and rich. None of us are benefitting from the fact that the lowest paid worker in the US earns less that he or she has, adjusted for inflation, since the introduction of the Federal Minimum Wage. I'm not suggesting a Minimum Wage beyond that as a safety net (although a Living Wage, adjusted for local cost of living, would be a tremendous boon for all), but it is just plain wrong for the best and wealthiest country in the world to ensure that our lowest-paid workers can not sustain a family of four above the poverty line.

In this great country, we do not create royalty. The Estate Tax (go directy to jail, do not pass go, do not collect two hundred dollars if you call it the Death Tax...) is not an either/or proposition - the bulk of this un-earned income should be passed to heirs, but it is reasonable to expect some of this to be redistributed, as our founding fathers would have suported. And please, no hysterical stories of farms or small businesses going under - if the founder of a business is wealthy enough to be affected by the Estate Tax, he or she can afford a lawyer and a financial planner to keep this from happening.

In this great country, we value hard work and families. Minimum Wage earners are actually working for something (unlike trust-fund kids in most cases) and deserve respectful treatment and a place at the table. If employers won't do this, simply because they can, the safety net of the Minimum Wage is a reasonable way to direct these business owners to contribute to their brothers, their neighborhood, and their society.

After all, the GAO's own studies show some interesting things: most new jobs are created by small business owners. Most Minimum Wage-earning employees are employed by small business owners. Small Business owners in the states with the highest Minimum Wage are also the most prosperous, even adjusted for increased cost-of-living in these states. These same small business owners benefit most from more stable employees, safer neighborhoods, increased local spending, etc., that the increased Minimum Wage delivers.

A spending cut (instead of a tax cut/welfare for the wealthy) would be appropriate to balance a Minimum Wage hike. Maybe even a federal tax break to the business owner for each new employee hired at the Minimum Wage or higher after the Minimum Wage is increased.

I can already hear the Republican congressional candidates already practicing their speeches: "We tried to increase the Minimum Wage in congress, but the Democrats voted it down!" When will people stop believing this crap?