Once Again: The Sky Is Rising When It Comes To Creative Output
from the why-so-much-doom-and-gloom? dept
A few years ago, we released our Sky is Rising report, looking at the state of the global entertainment industry, in which we found that, contrary to the story of gloom and doom that was being spread by some special interests, the real story was quite exciting. What we found when we looked at the actual numbers was that we are in a true renaissance of creativity, with massively more content -- video, movies, books, music and video games -- being produced these days than ever before. Perhaps more importantly, we saw that the amount of money being spent on these things also continued to increase -- though it didn't always flow through the same channels as in the past. This combination of factors -- more content producers, many new channels -- often led some people to insist that the industry was collapsing, rather than the truth, that it was growing rapidly, just in more distributed ways. That represented certain challenges for many people in the creative industries -- but from a public policy standpoint, it certainly suggested that things were pretty good -- not deathly bad, as was often implied. Last year, we came out with a follow up report that focused on Europe -- noting a similar pattern in various European countries, though with some countries facing unique and interesting challenges. However, one interesting aspect of that report was that we saw a stronger pattern of success in those areas where innovation was allowed to thrive and flourish, rather than be held back.Today we're launching the third report in this series, The Sky is Rising, 2014 Edition, focused on the United States in particular. And, once again, we see the same basic story. Lots of growth. Tons more content being produced. Lots of stories of new business models and artists connecting with their fans in new and unique ways. We're seeing new markets develop, along with new tools to help those markets. But the key story is the same as always: there is more content being produced today than ever before, and it's helped along by innovative technology, as the two often go hand in hand. More content than ever before is being produced, and content creators have more new and powerful ways to create, to distribute, to build a fan base, to connect and to build a business model -- and that's quite exciting.
At the same time, there's a push underway to reform our copyright laws -- something that we agree needs reform. And, yet, strangely, much of the rhetoric around reform has been based on the idea that the content world is suffering, or that there's some sort of "Hollywood vs. Silicon Valley" battle going on. The actual evidence suggests no such thing at all. Rather, it suggests that when innovation is allowed to flourish nearly everyone benefits. More content creators are able to do much more and create much more content. More fans are able to experience and consume much more content while supporting content creators in new and unique ways. From a public policy standpoint, it seems like things have been trending in the right way for a long time. If there's to be any sort of public policy change it should be to try to speed up that process, rather than to slow it down.
You can read the full report below. Once again, as with the previous editions of this report, we'd like to thank CCIA for sponsoring and publishing the paper.
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Filed Under: books, copyright, copyright reform, culture, film, innovation, movies, music, sky is rising, tv, video, video games
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Revenues revenues... profit?
Now, looking at revenues is fine, however the argument should also be that you don't NEED an increase in revenues to show health.
You point out that digital sales are growing in all areas. These are close to zero marginal cost products. That means every digital sale is nearly pure profit (after retailer margins), while physical sales have a cost of goods, etc.
Flat revenues with a declining cost base would result in more profit in the industries. Growing revenues AND a declining cost base just means that there's way more money floating through. Of course, the people who really suffer are the manufacturing bases, such as physical disc manufacturers and retailers, not Hollywood or the content creators.
There is so much focus on revenues and barely anyone mentions the fact that digital is close to zero marginal cost and nearly pure profit, and that the digital/physical mix should be increasing profits naturally, even if revenues don't increase. And, as Amazon would hopefully tell people, profits are quite important, revenue isn't everything. Amazon has massive revenues but about zero profits.
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Sorry. Stronger than me.
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Let Freedon Ring
This started obviously with audio - digital recording and processing has allowed the small professional to produce studio quality albums without a massive investment in technical equipment; this has been the case for two decades or more. Modern digital synthesis means you don't need to buy or rent an orchestra full of instruments to produce your own music. A cheap keyboard and a computer can substitute for guitar, drums, horns, whatever.
Cat videos may be a staple of YouTube, but more and more amateur productions find their way onto the service; I read a report recently on how many hundreds of millions the ad system has paid for this content. Amazon now allows the author to by pass the publishing houses and self-publish eBooks; formatted with easily available software. It's only a matter of time before anyone with a smatter of time an talent will be able to take a digital animation tool like Blender, dress a virtual set with freely-available models of whatever props are needed, and walk their virtual actors through any movie they want. Kits allow the construction of games for anyone with imagination.
Heck, even popular blogs are a passable substitute for the filtering process that editors and big content originally provided. Word of "mouth" like twitter can make a product go viral the way radio stations used to generate the buzz to make hit songs.
It's a brave new world, and the dinosaurs need to adapt or else...
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An Example...
Now consider - even in the heyday of MTV, how many groups made $100,000 off a video that probably took $5,000 or less to make? How many unknown rank amateurs did so? This is the brave new world, where anything is possible.
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The key word: 'Nearly'
'Nearly' everyone benefits, but those that are used to placing themselves, like it or not, between the creators and fans, throwing up a toll-booth for 'their' cut, are suddenly finding out that more and more, people don't need them.
Why hand over the rights, and most of the profits, for your music when you can just self-publish on a service that gives you the majority of the profits and lets you keep the rights to your works?
Why hand over the rights to your stories/books, when you can self-publish on a service that lets you keep the rights to your creation, along with most of the profits?
The days of the parasite gatekeepers are coming to a close, but they are going to be fighting tooth and nail to keep the control, and money, that they have grown accustomed to, because the alternative, giving up that control, giving up those profits, and either becoming enablers rather than gatekeepers, or going out of business? That's completely inconceivable to them.
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Those eye-rolling 'off the cuff' statements
An example from the PDF:
"Video games were once expensive, standalone machines. Video arcade systems that consumed players’ coins were relatively quickly replaced by home console systems that offered comparable (and now superior) graphics."
The reality was that both arcade games and home video games came out at almost exactly the same time in the early 1970s and coexisted together for many years. Graphics of both types of systems were for the most part comparable (and in the case of early games like Pong, identical) with one glaring exception, the Atari 2600, which was literally a stone-age relic throughout most of it's decade-plus sales run. In Japan, coin-operated arcade games never went out of fashion, and are still as popular as ever.
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Re: Those eye-rolling 'off the cuff' statements
Yes, indeed, your history is accurate. The very first commercial arcade video game came out in 1971 (Computer Space, by Nutting Associates). The very first home console video game came out in 1972 (the Magnavox Odyssey -- the prototype of which is in the Smithsonian).
I love that bit of trivia, because most people assume that the first of each category was Atari's Pong, but it's not so. The arcade version of Pong was 1972, and the home version was 1974 -- although the Odyssey had the very first Pong -- Acorn, the engineer who developed Atari's Pong, says Bushnell cribbed it from the Odyssey's Pong, but Bushnell said he cribbed it from a Pong program the existed for the PDP-1 in 1964.
Yes, I'm a computer history geek.
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Re: Those eye-rolling 'off the cuff' statements
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The quality of the visuals is irrelevant (as it should be: the important thing isn't how pretty a game is but how good the gameplay is -- something that much of the game industry seems to have forgotten years ago). Also, you wouldn't want arcades to provide full, several-hour experiences. That would be antithetical to their main appeal.
It seems to me that arcade games and the type of game your talking about are addressing two totally different audiences. Arcades are primarily social experiences, console games (even online multiplayer ones) are not.
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The dynamic is much more subtle and nuanced than the numerous articles presented here tend to state.
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False comparison.
We have never said that copyright is *crushing* content creation, rather that it often hinders *innovation* and forms of *free speech* that are important for cultural purposes.
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