Dana Blankenhorn

The Politics of Comstockery

American censorship, no matter its reasoning, is always political. It represents an effort by a dominant or growing Political Thesis to ride the other side out of the debate.

The Comstock Laws of 1873, the most successful censorship regime, were used by Republicans to banish reformist impulses under the Civil War Thesis that reached its peak under then-President Grant. (That's Anthony Comstock himself to the right, from Wikipedia.)

If you can't describe the sexual violence and degradation attendant to the rise of industrial New York, you can't possibly change it.

The great successes of the Progressive Movement, such as Jacob Riis' classic How the Other Half Lives, lay in describing this reality so it could be addressed. Forcing attention on what needed reforming required defying what had become the common concept of the law.

The Customer Is Always Right

There has been a bit of liberal triumphalism on the blogs lately. (This is a band which gets what I'm about to write.)

It has to do with copyright. Copyright is an issue that has united both Left and Right Blogistan since the Web was spun. All those who work on the Web recognize that the absolutist position of the copyright industries is self-defeating. The only way you succeed with a market, or an audience, is by identifying with its needs, ahead of your own.

In journalism this is called credibility. In music it's called keeping it real. In the real world of business it's called the customer is always right.

Yet for a decade now the copyright industries have been fighting what their market obviously desires, the unfettered access to content which the Internet provides. The copyright industries have changed the law, they have tinkered with technology, they have forced ads onto viewers, they have editorialized. None of it has worked.

In a free market consumers have the ultimate power. If we keep our hands in our pockets you don't make a sale. If we don't like the terms and conditions we are likely to keep our hands in our pockets. End of story.

Two liberal blogs, Eschaton and Down with Tyranny, are in an especially feisty move this morning. Atrios notes the fall of the newspaper industry.  Howie Klein notes the fall of the music business.  While these are both political blogs, doing a bit of political gloating, fact is both are covering a business story.

And that's my beat.

The great failure of the copyright industries in the last decade has been its inability to create  compelling business models for the Internet which bring the same revenue, per viewer, that they had before. This is largely because both were dealing with overly-large numbers.

It's not what the million-selling records or the hundreds of thousands of newspaper buyers think which is important. It's not the customers you have despite your attitude that is important. What is important is what each individual consumer believes, both those who are buying your product and those who are not.

What matters is whether you can make money with one consumer, not 1 million. Do the first and the second will follow. Nothing else matters.

It is possible that video will lead the way here. Because video is discrete, because it is expensive to produce, and because good video will always be in short supply, there is promise.

The battle is now on between networks and Internet companies to monetize video. If you go to Comedy Central's MotherLoad, for instance, you'll be forced to watch a liquor ad for each two segments of programming. (I like the mute button.) And Google is not the only Web company now seeking video circulation.  Netscape is in on it,  and at the heart of the recent NBC Universal deal is the idea that AOL and Microsoft will be getting in on it too.

What matters here are metrics:

• Cost to deliver each video.
• Cost to advertise each video online.
• Value you receive per viewer.

Talk Radio is Right Wing Rock

Some of our pieces in The 1967 Game make obvious sense, like comparing Mitt Romney to his father George.

This one may make less obvious sense. Just remember we're not talking about talent, but about political history, and the political impact of what its adherents call an art form.

Talk radio is right wing rock and roll.

Talk radio is actually older than rock was in 1967 (it was barely 12 then), but as any visitor to the Hall of Fame will tell you, rock music actually traces its lineage further back, as it was originally a fast Rhythm and Blues. And R&B dated from the 40s, 20 years from the date we're talking about.

Modern talk radio also dates back 20 years, to the 1987 end of the Fairness Doctrine. Destroying the premise of broadcast regulation allowed right-wing screamers to take the bark off, to ignore community standards and wail away. You might think of Rush Limbaugh, then, as being the Chuck Berry or Little Richard (left) of this new art form.

Talk radio reacted to the Clintons much as rock music reacted to the Eisenhower years. It developed in reaction. If it had an Elvis Moment, it was obviously the Lewinsky Scandal. Just as with rock in the mid-50s, the Lewinsky matter pushed talk radio to the forefront, legitimized it, and turned its players into true national figures. Here is where a host of new stars emerged, like G. Gordon Liddy and Ollie North, each with their own song of white male suffering. The Day the Music Died was the day Clinton was acquitted.

The key to the rise of both talk radio and rock music was a defined audience, one with enormous loyalty and a feeling of oppression in their daily lives. White middle class men, many of them in jobs that required lots of driving (thus lonely), did for talk radio precisely what lonely teenagers in their bedrooms did for rock music. They defined it, they set its tastes, and they created their stars in their own image. They followed its message and took it to heart. (Oh, so that's why Limbaugh is so ugly.)

Jobs-Envy

Despite the similarity in their ages (they're both born in 1955, same year as me) Steve Jobs and Bill Gates are men of different times.

Gates is of the 1980s, when computing was defined politically, through software. He became the anti-IBM candidate for the future of computing, then outmaneuvered IBM at the bottom of the stack, in the operating system, where it had made itself vulnerable.

Jobs is a man of today, when computing is defined in terms of marketing, where it has become a mere extension of consumer electronics. Image as defined by Hollywood, a focus on cool design and simple return policies, has always been his metier. You pay for that -- you've always paid more for Apples -- but the value proposition is always there.

So why all this Jobs-envy?

When people like Bill Thompson of the BBC (the picture is from his column) attack Jobs, they see  what isn't there rather than what is, saying Apple has "a tiny share of the computer market and an increasingly perilous first mover advantage selling portable music players," then complaining that we pay it too much attention.

Jobs-san

One name kept coming up in my head while watching Steve Jobs introduce his over-hyped, exquisitely timed iPhone.

Akio Morita.

Morita, the legendary Sony chairman, didn't do demos. But he was brilliant at taking parts and turning them into consumer electronics products that people would want. He would stay just slightly ahead of the demand curve, seldom getting ahead of himself. He was also an iconoclast, who insisted on going his own way and sometimes (as in Betamax) paid the price for it.

As much as anyone, Morita transformed Japan from a manufacturer of junk to a quality brand. He forced other companies to follow him, and some of the credit for their success should go to him.

Of course Morita made two key mistakes, which Jobs is also threatening to make:

How Much Further Can Apple Go?

The lovely bride and I were at the Apple Store at Lenox Mall recently, with our teenage son, and the place was (as usual) mobbed.

It's clear this has been the Apple decade. Much as the 1980s belonged to Microsoft, and the 1990s to Web start-ups (Netscape, Yahoo, etc. etc. etc.). Apple defines the landscape. Which is interesting, given that Steve Jobs had, until this decade, been considered a rank failure next to the Great Mr. Gates.

Which goes to show you that there are times for strategies. Apple's has always been a hyper-proprietary strategy. This was a weakness in the 20th century, because it kept Jobs from winning the computing market share his software deserved.

Today, however, nearly the entire value-add of hardware consists of software. The stars have aligned in Jobs' direction. DRMs, Chinese mass production, the primacy of design, computing as consumer electronics. This is Apple's time.

Which leads everyone asking, for how long, and how far can it go?

This Week's Clue: Final Five: Moore's Law

A-Clue.Com will cease in its present form at the end of the year. It will be moving here, becoming a regular weekly feature of the DanaBlankenhorn.Com blog.

To celebrate this change I  have five essays on the main topics this blog has covered in its decade of e-mail existence, looking mainly at their present and future. First, last week, was e-commerce, the original beat here. Today I have an essay on Moore's Law. Next week features The World of Always-On, then we go on Political Cycles, before finishing up with a big Internet Future essay.

Enjoy.

 

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Gordon Moore doesn't agree with me about Moore's Law.

His statement from last year, that Moore's Law is dead,  was narrowly drawn and true as far as it went. Fact is the closer you bring circuit lines together, the bigger the magnetic interference when you run electricity through them. Beyond that there is a theoretical limit – when lines get within 1 nanometer of one another, they cease to be separate lines.

But the Moore's Law Process is very much alive. We see it in hard drive capacity, where disk sizes double at the same price every 18 months or so like clockwork. We see it in optical drives, where every few years features a dispute between manufacturers over technology that's 10 times better than what came before. We see it in optical cable, where the use of different colors lets makers pack ever-more bits down the same pipe. We see it in wireless, where improved digital signal processors enable a 802.11n modem to run 10 times faster than an 802.11b, on the same frequency spectrum.

We even see it at Intel, in the chip sector. The company bit the bullet on its designs two years ago, and now pushes ahead with lower-power chip technologies and multiple processors on a chip. The quad chips of today are indeed four times faster than the single processor chips of three years ago, just as Moore's Law would have predicted.

What Makes An Interest Special?

Charles Martin wrote today pointing to a News.Com story (and discussion thread) on the RIAA trying to use the current lame duck session of Congress to get even more anti-consumer legislation into law.

The RIAA is a classic "special interest." It's narrow, but more important it has money, presence, and the ability to take revenge on those who disobey.

As the price of doing all this has risen, more general interests have been drowned out.

But in an era of Internet Politics, maybe not so much.

Abundance vs. Scarcity

The economics of this decade can be summed up as a fight between abundance and scarcity. (Pictured is the first oil well, courtesy the Paleontological Research Institute.)

Digital goods are abundant, their economics that of abundance. The time and attention of buyers is limited, the products on offer unlimited. So if you can monetize small slivers of that, as Google, YouTube and MySpace do, through truly deep personalization (it's all about you and what you want to know, see and feel) you're going to make money.

In contrast there is oil economics, which the current Administration has been making paramount. Oil is based on an economics of scarcity. The providers have the whip hand, and by manipulating supply they can maximize their value. OPEC does it, refiners do it, integrated oils do it by owning their own dealers.

The producers of "copyright" goods -- movies, TV, music, books, software, etc. -- all depend on an economics of scarcity. You've got to see that movie now, you've got to turn on the TV to this channel at this time, you've got to get the #1 hit and be the first on your street to read the #1 book. You want to run the new Windows applications, so you need Windows now, and new hardware to run it. This makes the supplier of the good king, able to name their own price by manipulating supply -- just like an oil company. And it's good to be the king.

What the Copyright Wars Are Really About

Every market has two sides, buyers and sellers.

Most markets also have intermediaries, and folks standing in for one side or the other of a transaction.

All these people in the middle are threatened by the Internet. But few have the power and money to fight back.

The music business does have this power and money. That had the power to get the DMCA through Congress, to get the WIPO treaty passed, and thus to get DMCA-like laws passed around the world. They constantly harp on the idea that they're in it to "stop illegal downloading," in other words, to represent the interests of the seller of product against the buyer.

But this is simply not true. They are, in fact, trying to retain their power as an intermediary, in behalf of the seller, and prevent that seller from going direct to the market.

Every once in a while we get wind of another artist who breaks through the noise and does exactly this. Usually it's a previously-unknown artist who did a lot of their own technical and marketing work, and who is thrilled that (thanks to their success) a publisher has stepped in to hand them an advance check.

This week, however, we have an established artist with almost no technical background using the medium music publishers wish to destroy to reach the audience and find great success.