Congeries of cross connected concepts
This article about the decline of Old Media has been passed around a lot, but I will basically ignore the content and use it as a bait and switch for my own thought, which concerns the question “Why wasn’t Old Media successful at harnessing the Internet?”.
I think that’s a good question, if for no other reason than back in the 1970s when I first heard discussions on this subject, the concensus was that the key “value add” feature of the coming Information Age was editorial. That is, filtering the flood of information and picking out the good bits. Old Media seemed in an excellent position to make the most of that, being information companies and having skilled editors. But it didn’t work out.
One reason is (as for the music industry) the Internet disintermediates, which in turn means that organizations in the middle must become far more efficient and lean to survive. This is very hard for any instutition to do and Old Media proved no exception. I have plenty of personal anecdotes related to me by people in the industry of the sort of padding that was and to some extent still is present.
But I think that more importantly, the rise of social media meant that consumers could become participants at the same time journalism became much more proscriptive. In other words, just as journalists were becoming more like deer hunters, the deer were building their own guns. Hunters don’t like that and would certainly shy away from anything that would upgrade their prey’s capabilities. There was the Narrative and nothing detracts from the Narrative like dissenting voices (as many of us know from personal experience). I think that Old Media missed out on the Internet to no small extent because they were unwilling or unable to handle debating their Narrative. You can still see this happen on a regular basis, some Old Media Person of Importance lashing out at the idea that the peasantry might dispute his version of events or even throw contrary facts at him. It won’t matter in the long run — we are swinging back from the era of mass propaganda in which Old Media was forged to a far more fractious style similar to the coffee houses of early Industrial Age Europe and purveyors of information will just have to adapt or go under.
| Hey Skipper Tuesday, 17 March 2009 at 11:48 |  |
This article along the same lines is also pretty good.
BTW — very well written precis.
| Bret Tuesday, 17 March 2009 at 12:26 | |
“…the key “value add” feature of the coming Information Age was editorial.”
Yes. The problem for the newspapers is that information consumer preferences are extremely varied. For example, you are providing the editorial/filtering service. I happen to particularly like your editorial/filtering service, along with what looks like to me about fifty other regular readers. There is no newspaper with an editorial/filtering capability that meets my particular preferences as well. Fifty readers cannot support a newspaper. Therefore newspapers are probably not going to be able to capitalize on editorial/filtering.
| Harry Eagar Tuesday, 17 March 2009 at 13:38 | |
Well, nobody is, in a business sense.
Craigslist does not take away revenue from my newspaper, it simply destroys it. There are people who think you can live on air, but they are very skinny.
| Annoying Old Guy Tuesday, 17 March 2009 at 14:08 | |
Bret;
That’s because I have rather iconoclastic tastes. Consider, say, Instapundit, who is almost entirely an edtor. Or The Huffington Post. The revenue streams are certainly going to be a lot smaller but the overhead should decrease even more.
Mr. Eagar;
You mean Craig’s List takes the money out and burns it? Wow, that’s hard core. Here I thought it just remained in the consumer’s pocket to be spent on other things.
| Harry Eagar Wednesday, 18 March 2009 at 12:41 | |
It’s the Linux model, without the side money.
| Annoying Old Guy Wednesday, 18 March 2009 at 16:09 | |
Mr. Eagar;
One of the hallmarks of economic progress is that things get cheaper, thereby improving the standard of living. Most people consider that a good thing, although it can be rough on the providers of formerly expensive things. If you want to go Luddite, that’s your choice, but that has generally not been a popular choice.
Hey, Skipper;
The most interesting thing in that article is the bi-polar attitude of Old Media toward property, that it’s just an affectation when it belongs to someone else and vitally important to protect when it belongs to Old Media. Mr. Eagar demonstrates that in microcosm, alternately complaining that Old Media is failing because of rapant theft, and then castigating us for overly valuing property rights.
| Harry Eagar Thursday, 19 March 2009 at 12:23 | |
Not overly. Exclusively. There is a difference.
Nothing ever gets free, Guy. There ain’t no free lunch. Craigslist is a business model in the cities where it does business. I suppose you could consider it welfare for sellers in places where it does not do business. In any case, subsidizing sellers of furniture in Alaska on the backs of sellers of sex in Chicago is a very strange business model.
| joe shropshire Thursday, 19 March 2009 at 15:22 | |
At first blush, maybe. But it’s really no stranger than subsidizing the business reporter for The Maui News, on the backs of people trying to sell a condo through The Maui News.
| Hey Skipper Friday, 20 March 2009 at 01:56 | |
AOG:
Yes, that was very interesting. I don’t know how sanguine newspapers were about Napster, but certainly their attitude towards others’ property and their own was bipolar.
I also noted this:
The protection by technology was accepted as the natural order of the universe, and the papers did not understand the implications of the fact that their power rested not only on their ability to monetize their intellectual property, but on the inability of others to do so.
The implication here is that the newspapers actually possessed intellectual property that is worth having, rather than having that property’s value inflated solely because the cost of producing that property acted to severely limit the supply.
I call shenanigans.
At the risk of throwing my back out of whack patting myself on the shoulder, this post, completely original — not even riffing off someone else’s work — is at least as good a discussion of savings rates as I have seen in any non-specialist publication.
In other words, to a fairly great extent, newspapers do not possess valuable intellectual property. What they did possess was the means of production.
| erp Friday, 20 March 2009 at 09:05 | |
That was a great post Skipper.
Since November 23rd, however, things have deteriorated so much it’s become clear simply waiting out the crisis as we did during the Carter years may not be enough to save our bacon.
We’ve put a fairly substantial wad of cash in the mattress (safe deposit box) at my insistence and against my husband’s wishes, but now he’s even more forcibly insisting that we “park” it someplace before the dollar completely loses its value, but where?
We’re too old and tired to invest in cheap real estate or other risky ventures, so unless and until the One self destructs and in a way that destroys all his schemes and schemers, I’ll continue to insist we sit tight.
If Obama et al. succeed in destroying our institutions and economy, it won’t matter what any of us do. Goons and thugs will be in charge de jure and people who get their information from the msm won’t know what hit them.
It’s our kids and you guys who still have many many years to live and bring up your kids I worry about.
| Bret Friday, 20 March 2009 at 10:03 | |
erp,
Your worry is touching, but I have a hunch it’s misplaced. In virtually any form of society, the folks writing and commenting here will likely be in the top group - from my perspective it looks like a pretty adaptable group. The less able always bear the brunt of societies’ failings. Indeed, if you’re feeling “old and tired” perhaps you’re in the more vulnerable group.
| Harry Eagar Friday, 20 March 2009 at 13:03 | |
It isn’t society that failed. Society is doing OK. It’s markets that failed to deliver what they charged for.
You might almost as well buy gold, erp, since currency doesn’t pay interest now either. Only the market has completely failed. We know it doesn’t know how to value equities now (following the Dow shows that); and it cannot value bonds and mortgages (well, it could, but the cost is too high to make that worthwhile); and it turns out that, for the first time in history, it cannot figure out how to value gold, either.
I have taken to checking into kitco.com. This is the funniest site on the net.
| Annoying Old Guy Friday, 20 March 2009 at 13:28 | |
Hmmmm, bit of an ironic comment from someone who was just going on about the difference between “overly” and “exclusively”.
| erp Friday, 20 March 2009 at 17:06 | |
Bret, we feel old and tired because we are old and tired. As for feeling vulnerable? Perhaps, but only because we’d like to leave something for our six grandchildren. Our needs are so few, we can manage on very little if need be.
Thanks for your optimism. You sound like our kids who tell us not to worry. I know you can all take of yourselves, but I still can’t help worrying.
Harry, for some reason, gold doesn’t appeal and it’s not the lack of interest that concerns me, but confiscation of bank accounts.
| Hey Skipper Friday, 20 March 2009 at 20:05 | |
erp:
… for some reason, gold doesn’t appeal …
My guesses: gold has worth, but not as a medium of exchange; also, many countries have large gold reserves.
For instance, the US holds over 8100 tons, two and a half times as much as the second place country, Germany.
Interestingly, for accounting purposes, those reserves are valued at $42 per ounce.
Which means one way for the US to pay off debt would be to sell gold, which in any significant amount would immediately tank gold’s price.
As David Cohen as observed, it doesn’t make sense to consider debt without also considering assets.
| erp Friday, 20 March 2009 at 21:48 | |
It’s funny, I don’t much care for gold jewelry either — platinum is nice though! I agree we should consider our assets, but it’s our people that are our treasure not gold bullion.
| Hey Skipper Friday, 20 March 2009 at 23:15 | |
True enough.
However, I don’t think there is any basis for concluding that for the first time the market cannot value gold.
| Harry Eagar Saturday, 21 March 2009 at 00:26 | |
The price of gold is gyrating about as wildly as the Dow or the S&P, both of which are obviously out of control, with prices decoupled from anything like asset value. The bucket shop continues to operate 24/7.
erp, I think you can set your mind at rest about bank accounts being confiscated, unless you bank in Venezuela.
| erp Saturday, 21 March 2009 at 07:37 | |
Harry, isn’t the Venezuela model one of the ones being considered by the One?
| joe shropshire Saturday, 21 March 2009 at 13:37 | |
No, they are not considering it anymore.
| Bret Saturday, 21 March 2009 at 21:22 | |
erp,
I agree with your platinum opinion. Personally, I think gold is the second ugliest color in the world (yellow being the first), so I never, ever buy my wife gold jewelry.
| Harry Eagar Monday, 23 March 2009 at 13:22 | |
No, erp, nobody in the US is considering the Venezuelan model. Nor ever was. Although you might be surprised at the list of names of capitalists taking Chavez money. See the review of ‘The Threat Closer to Home’ at Restating the Obvious.
One thing you know about free market idelogues: They are always for sale, all the remains is to negotiate the price.
| erp Monday, 23 March 2009 at 17:01 | |
As usual Harry, it’s necessary to define your terms. How are the capitalists defined as referenced in your comment above and do you count Bobby Kennedy, the saviour of Bostonian have-nots, among them?
BTW - Are you sure you’re privy to what’s being considered everywhere in the US.
| Harry Eagar Tuesday, 24 March 2009 at 12:21 | |
Bobby Kennedy, the master coupon clipper, a capitalist? Of course.
But I was referring to Newt Gingrich.
| erp Tuesday, 24 March 2009 at 14:43 | |
I hold Gingrich’s amours responsible for the GOP losing the 1996 election, but a coupon clipping capitalist? No so much.
| Harry Eagar Wednesday, 25 March 2009 at 08:58 | |
He’s a rentier, not a working stiff like me.
| erp Wednesday, 25 March 2009 at 10:23 | |
Why didn’t you become a rentier?
| Harry Eagar Thursday, 26 March 2009 at 14:25 | |
Never cared greatly about having a lot of money, and I like working.
| Bret Thursday, 26 March 2009 at 16:07 | |
Diametrically opposed to Harry again. I’d really like to have a lot of money but don’t like working much. Indeed, without the possibility of one day making a lot of money, I don’t think I’d bother continuing to work (much).
So here’s the thing. If virtually everybody’s like Harry, then the government can raise taxes to near 100% and it won’t hardly change the amount we all work. If a significant number are like me, then government spending and taxing may significantly damage the economy because those people will work less. Nobody really knows how many people fall in which camp but this grand experiment may help quantify those numbers.
| Harry Eagar Tuesday, 31 March 2009 at 12:17 | |
Thatv would depend upon how much you contribute to output, minus all the money-loving Madoffs and Wagoners who destroy capital.
It isn’t obvious that people like me contribute less. I would have to shirk for eons and eons to destroy 440 TRILLION
| Bret Tuesday, 31 March 2009 at 13:15 | |
Good point. I had forgotten your apparent belief that those who work for money tend to be nearly completely unproductive (er, counterproductive overall thanks to Madoffs and Wagoners).
Under that assumption, taxes should be raised to 100%. Sure, that’ll work - that’s the ticket!
| Annoying Old Guy Tuesday, 31 March 2009 at 13:26 | |
Was there ever $440T in existence? Also, hasn’t the experiment been performed multiple times and it turns out most people are more like Bret than Mr. Eagar?
| Bret Tuesday, 31 March 2009 at 15:23 | |
aog asked: “…hasn’t the experiment been performed multiple times and it turns out most people are more like Bret than Mr. Eagar?”
If the experiment you’re referring to is communism and socialism, then those experiments are thought to have had problems for the following reasons: (1) an inherent inability to address the Economic Calculation Problem; (2) inherent corruption in the totalitarian regime; and (3) distortion of incentives. The last (3), would be related to whether or not people are more “like Bret than Mr. Eagar” but I think that economists consider (3) to be a very secondary reason and relatively unimportant relative to (1). This is important, because even if everybody were selfless like Mr. Eagar and useful at the same time, such systems would still have serious problems delivering prosperity.
Note that if I had a relatively fun career like writing or being a musician, perhaps I’d like working as much as Mr. Eagar.
