Laws regulating traffic are written for a reason, but that reason is not to generate revenue. The rules of the road exist to keep public roads safe for drivers and pedestrians. Fines for infractions should be a deterrent, not a major source of revenue.
At least the red-light cameras, if properly financed, have the potential to enforce laws at no net cost to the law-abiding taxpayer. Unless the study cited above is correct, and they actually make intersections less safe.
I apologize that I have not read the study or articles cited in this post, but thought I would add another angle that I recall reading a few years ago about Washington D.C.'s early implementation of red light cameras.
Apparently, the manufacturer of the red light cameras was happy to install them for the cash-strapped city at a discount in exchange for a percentage of the red-light ticket fees collected. Then someone (a city council member, perhaps?) pointed out that if the purpose of these devices is to reduce the amount of red-light running, why should the manufacturer get rewarded by their products' failing to do their job?
Arguably a camera manufacturer that is being paid by the ticket would be more inclined to make the cameras harder to notice by drivers, or even cheat by somehow "catching" people who were not actually running the light. Come to think of it, why are these cameras always camouflaged? Shouldn't they be bright orange to make drivers more aware of their presence and less likely to run the light? (Yes, I am saying this with tongue in cheek. Revenue enhancement through "enforcement" of driving laws has been around as long as there have been cars and public roads, and I've got a few speeding tickets from small town cops to prove it.)
I always thought the D.C. case was an interesting semi-paradox, or at least a great example of private industry profiting off of local law enforcement.
I think the article's closing statement about raising the price is throwing off readers and missing the point.
The price change is a red herring. The resellers are unhappy that Google is selling direct and bypassing them, not that the price of the service is going down.
To wit, if a VAR can add $20 of value to a $30 service and sell it for $50, why can't they also add $20 of value to a $3 service and sell it for $23? If customers want to buy support from a VAR the fact that the cost of the underlying product has gone down shouldn't change that fact.
The only reasons the VARs would prefer to resell a more expensive product is because A. it better meets the needs of their customers or B. the product is sold only through VARs so they do not have to compete with their own supplier.
Fleckenstein was not the first to pin the dot com bubble on Greenspan's loose money policy. The exact same charge was expressed in the 2006 book "Bubble Man" by Australian business journalist Peter Harcher.
I get the "bubbles are good" argument, but we should not make that statement too generally. The stock market bubble in the late 1990's was eerily similar to the one seventy years earlier, and when that one popped we had 20% unemployment for almost a decade.
We should make a distinction between sound designed to attract vs. repel. If a store plays loud rap music or any other kind of music because that is preferred by its clientele, who cares? If a store plays a sound that is repellent to a specific group of people for the sole purpose of discouraging those people to enter the store, this is something altogether different.
A public space is one that the general public is allowed to use without interference. If a shopkeeper opens their store to the public, but is playing a sound inside the store that interferes with a normal person's ability to use the space, then they are certainly violating the principle of public space.
Be careful assigning a zero or negligible value to digital goods.
There is still a scarcity at play due to the fact that digital goods require physical resources for hosting and transport, albeit in much smaller unit quantities than physical goods. For a case in point, look at the financial statements of Level 3 (an internet bandwidth provider) and Akamai (a hosting service). Those two randomly selectd firms, which represent a sliver of the industry, had combined revenue close to $4 Billion last year, and have experienced double and triple digit annual revenue growth.
This demonstrates that society does place value on digital goods. To the extent that consumers can substitute physical goods with less costly digital goods, in the long run this supply/demand dynamic will tend to drive the price up as the digital economy continues to move along its marginal cost curve. In the long run, Internet technology is no more immune from "diminishing returns" than any other.
As another case in point, the combined average household expense for for bandwidth (cell phone, broadband, cable/sat TV, sat radio, phone, etc.) has been steadily increasing each year. If digital goods are getting cheaper, why is it that we are spending more money on them?
Peer-to-peer architecture and ad-supported business models do not make these costs go away, they just shift them to different places in the value chain (i.e. ultimately the consumer still pays).
David Simon is an immensely talented writer and producer, whose show "The Wire" falls somewhere between epic poetry and Shakeapearean drama. He is also the rare fellow who despite his success in television (he can now afford theater tickets for himself and all of us too), has not lost his edge.
Simon's history lesson is true: there is a dying culture of newspaper reporters who follow the actual workings of local crime, business, and government with the same determination and passion that the mass media now devotes only to celebrity, scandal, and salaciousness. These people still exist, albeit in declining numbers, but their readers and publishers have either died off or been seduced by perky television news anchors.
News may be abundant, but the persistence to cover boring city council meetings that actually determine the fate of the community is in short supply, as is a readership that feels so attached to its community that it cares deeply about these things.
Another very talented writer, Mark Bowden, wrote a fascinating profile of Simon in The Atlantic. If you are interested in the newspaper business, watch this season of The Wire, and read this profile:
In the article cited and the discussion thread above, there is a persistent tendency for "artist adoration."
People who decide to become recording artists are just ordinary human beings who happen to have a mass-marketable talent, and have chosen to sign a record deal in hopes of making it big.
My point is not that record labels are paragons of morality, but that they are not especially different from the owners of other firms.
Our society places so much value on celebrity, and projects its own desire for youth or rebellion on recording artists, that it has invented a mythology that recording artists are victims of their industry. I am beginning to sense that even a fairly enlightened thinker can fall for this myth.
If the recording industry's actions resemble that of a pimp, it is only because society's desire for beautiful, marketable, talented musicians resembles lust. Artists enter into these deals of their own free will, with hopes of selling (or renting) their talent to a mass audience, and sign up with the highest bidder. It is a victimhood of choice. With the exception of the rare prodigy-savant, musicians have other life choices available, and many who have been "successful" might have found a more healthy, positive, and mutually rewarding bargain with society by setting their sights a little lower than international fame.
Don't believe the hype. Art is divine, but artists are not gods.
To put this in an economic perspective, consider that for most of the history of the recording industry, it WAS primarily a manufacturing business. Record labels had large investments in fixed assets (or long-term contracts with other firms making these investments) to manufacture records, tapes, and CD's and distribute them to retail stores. Artists were a relatively inexpensive supplier of raw materials (songwriting and performance), who were in great supply but whose success rate, as the article explains, was about one-in-ten. With such a dismal prospect of cashing in one's talent, artists couldn't exactly go out and get bank loans to finance their own recording sessions, manufacturing, and distribution (would you give a loan to a friend who only had a 10% chance of paying it back?). So they went to the loan sharks, aka the recording industry, who fronted them all of the initial investment in exchange for a pitifully small share of the potential return.
The internet and digitization of music has opened up new frontiers for musicians, but the record industry still is incurring the costs of fixed manufacturing assets. It is an established microeconomic principle that a business should only exit a competitive industry if, in the short term, its revenue is less than its variable costs (which are low). Simply stated, the record labels will continue to operate the CD business until they are no longer paying off the manufacturing capital; until that point is reached it is actually more costly to shut down than to operate at a loss. Maybe then we'll see significant investment in pure-play digital distribution and more creative business models than the old ones that persist today.
My point here is that we can debate the record labels' morality until we're blue in the face but the reality is that they held the economic power in the artist-label relationship until very recently. As capitalists, they exploited that power for profit and to make good on the commitments they made to their investments and creditors. They are "helping the artist" no more or less than, let's just say, the owners of a software firm that pays Chinese or Indian programmers $2 or $3 an hour to write code is helping them. When's the last time we've heard anyone on this blog or elsewhere fret about the low standard of living of this workforce, or how they're being cheated out of their fair share of profit in the software industry? Many of us have profited in the appreciated value of software companies employing this workforce, and you're probably running code written by one of them on your computer right now. I sympathize with recording artists, but they are now free to take their own risks and get their own payday, regardless of whether they or others wish to blame past failures and vulnerability on the evil recording industry.
Radiohead's digital pre-release of "In Rainbows" was an unqualified success. Most notably, it is a sensational album, not an experiment with some throw-away tracks. It's among the band's best all-time albums and among the best albums released by any artist in 2007.
Wired magazine recently printed an interview of Thom Yorke by David Byrne which revealed some of the nuances of Radiohead's strategy (as well as a comprehensive survey of the business models currently available to recording artists). Three facts stand out: the online sales of In Rainbows alone, even with the name-your-price option, exceeded the combined online sales of every prior album the band has ever produced; Radiohead owns all the rights to the master recording, virtually unheard of in the recording industry; and the physical CD release is a limited licensing deal, not actually a release by the band itself.
This fall's release of In Rainbows was one of the rare cases where a heavily pre-publicized event actually lived up to the hype.
The NYT article correctly cites the film industry's desire to store not just finished copies of movies, but the outtakes as well. A commonly used digital intermediate file format for feature film production requires 50MB per frame. At 24 frames per second, a two hour feature takes up 8TB. With a typical 10:1 shooting ratio you've got 80TB of media to archive for a single movie.
Film negative used for movies does not technically have more data density per square inch than today's hard drives (although there are experimental holographic film emulsions that do). The cost advantages are process-related. For a traditional analog film archive, you simply put the material on a shelf and the costs are shipping and storage. For a digital archive, there are additional costs of transferring the media from the production server onto an archive format, backing it up, and periodically recopying as old physical formats become obsolete. The shelf life of film negative is well-known. The shelf life of a 1TB hard drive is not well-known, and is not believed to be as long as the film.
The file format used for archived media would need to have similar or identical characteristics to the file format used to edit the media, if the archived media is to have value as a raw material from which to produce future media products. The path that digital media takes from acquisition to manipulation to distribution/consumption generally involves lossy compression. When designing a path for digital media to take from acquisition to archive for the purpose of future manipulation and reuse, quality loss is not desired.
Hardware does not dictate file formats, but technical requirements influence, if not dictate, both. Consumers don't need to edit material for projection on a 70 foot screen, thus consumer electronics equipment and the formats suitable for the consumer are generally not interchangeable with professional cinema production formats. Again, the technological gap is only going to get smaller over time, but today it remains fairly wide.
I can understand that people outside of the industry might make naive assumptions about cinema technology, but I am puzzled as to why the topic of this New York Times article is drawing criticism and dismissal. There are plenty of excellent reasons to dislike Hollywood, but its desire to preserve digital media assets is not one of them. The technical challenges discussed in the article are real, and well-known to the archivists and engineers who design and operate media archives.
A couple of points are missed here, I believe due to some confusion about the motion picture industry.
1. There is a significant difference between the level of technology used to produce films than that used to distribute them. It is true that storage is cheap and getting cheaper. However the storage needed for the uncompressed original footage is thousands of times greater than that needed to store a finished DVD or digital cinema distribution copy. The assertion made in the NYT article that digital storage is more costly than the analog storage is correct, largely because analog information can is stored in very dense media such as a 70mm camera negative.
2. The reason that movie studios use 'proprietary formats' to archive their content is that these are the formats necessary to digitally acquire, manipulate and produce films of acceptable quality. There is no consumer market for 4K digital intermediate motion picture file formats, any more than there is a consumer market for 70mm film cameras or projectors. While the divide between consumer and professional technology is narrowing somewhat in television technology, this is not the case in theatrical films. The hardware used to produce films -- and thus the file formats used to store these images -- are simply out of reach of the consumer. Someday this will not be the case, but until then it is not valid to suggest that a motion picture studio use consumer-accessible file formats for its archives.
3. P2P storage is an effective way to efficiently distribute current and timely information. It is not an effective way to maintain a long-term archive. The studios' business model relies upon keeping its intellectual property safe and accessible for the life of the copyright, regardless of the current level of interest. Think back to the height of the Napster/Kazaa craze a few years ago. Is every pop song that you shared still on your hard drive? If so, will it still be there in five, ten, twenty, or fifty years the next time it needs to be accessed?
The basic issue here is that technology is now changing more quickly than the value of the content. To wit: if I handed you a motion picture film from 1875 you would be able to hold it up to the light and see an image. If I handed you an 8" floppy disk from 1975, it is highly unlikely that you would be able to read the data, not only because the physical media is less stable but because the equipment used to read the media has become obsolete. Part of the increased cost of digital media archives is the need to periodically recopy and convert the archive as technology advances.
Yes, the media industry in general is overly concerned about file sharing and feels unnecessarily threatened by the internet. But this is entirely unrelated to content archiving. Archivists just want to keep stuff safe and accessible, and have a completely different set of motivations than the businessmen concerned about the internet's impact on box office and DVD sales.
On the post: Yet Another Study Shows Red Light Cameras Cause More Accidents And Aren't Needed
Re:
At least the red-light cameras, if properly financed, have the potential to enforce laws at no net cost to the law-abiding taxpayer. Unless the study cited above is correct, and they actually make intersections less safe.
On the post: Yet Another Study Shows Red Light Cameras Cause More Accidents And Aren't Needed
The District of Columbia model
Apparently, the manufacturer of the red light cameras was happy to install them for the cash-strapped city at a discount in exchange for a percentage of the red-light ticket fees collected. Then someone (a city council member, perhaps?) pointed out that if the purpose of these devices is to reduce the amount of red-light running, why should the manufacturer get rewarded by their products' failing to do their job?
Arguably a camera manufacturer that is being paid by the ticket would be more inclined to make the cameras harder to notice by drivers, or even cheat by somehow "catching" people who were not actually running the light. Come to think of it, why are these cameras always camouflaged? Shouldn't they be bright orange to make drivers more aware of their presence and less likely to run the light? (Yes, I am saying this with tongue in cheek. Revenue enhancement through "enforcement" of driving laws has been around as long as there have been cars and public roads, and I've got a few speeding tickets from small town cops to prove it.)
I always thought the D.C. case was an interesting semi-paradox, or at least a great example of private industry profiting off of local law enforcement.
On the post: You're In The Wrong Business If You're Upset That Your Supplier Is More Efficient
It's the relationship, not the price
The price change is a red herring. The resellers are unhappy that Google is selling direct and bypassing them, not that the price of the service is going down.
To wit, if a VAR can add $20 of value to a $30 service and sell it for $50, why can't they also add $20 of value to a $3 service and sell it for $23? If customers want to buy support from a VAR the fact that the cost of the underlying product has gone down shouldn't change that fact.
The only reasons the VARs would prefer to resell a more expensive product is because A. it better meets the needs of their customers or B. the product is sold only through VARs so they do not have to compete with their own supplier.
On the post: Does Alan Greenspan Deserve Credit For The Dot Com Bubble Too?
Not a new accusation
I get the "bubbles are good" argument, but we should not make that statement too generally. The stock market bubble in the late 1990's was eerily similar to the one seventy years earlier, and when that one popped we had 20% unemployment for almost a decade.
On the post: Is Annoying Young People With A High-Pitched Buzz A Violation Of Their Rights?
Common sense
A public space is one that the general public is allowed to use without interference. If a shopkeeper opens their store to the public, but is playing a sound inside the store that interferes with a normal person's ability to use the space, then they are certainly violating the principle of public space.
On the post: Yet Another Report Of Free Label Music That Isn't
Re:
There is still a scarcity at play due to the fact that digital goods require physical resources for hosting and transport, albeit in much smaller unit quantities than physical goods. For a case in point, look at the financial statements of Level 3 (an internet bandwidth provider) and Akamai (a hosting service). Those two randomly selectd firms, which represent a sliver of the industry, had combined revenue close to $4 Billion last year, and have experienced double and triple digit annual revenue growth.
This demonstrates that society does place value on digital goods. To the extent that consumers can substitute physical goods with less costly digital goods, in the long run this supply/demand dynamic will tend to drive the price up as the digital economy continues to move along its marginal cost curve. In the long run, Internet technology is no more immune from "diminishing returns" than any other.
As another case in point, the combined average household expense for for bandwidth (cell phone, broadband, cable/sat TV, sat radio, phone, etc.) has been steadily increasing each year. If digital goods are getting cheaper, why is it that we are spending more money on them?
Peer-to-peer architecture and ad-supported business models do not make these costs go away, they just shift them to different places in the value chain (i.e. ultimately the consumer still pays).
On the post: News Is Valuable, But Value And Price Are Two Separate Things
The Wire and The Paper
Simon's history lesson is true: there is a dying culture of newspaper reporters who follow the actual workings of local crime, business, and government with the same determination and passion that the mass media now devotes only to celebrity, scandal, and salaciousness. These people still exist, albeit in declining numbers, but their readers and publishers have either died off or been seduced by perky television news anchors.
News may be abundant, but the persistence to cover boring city council meetings that actually determine the fate of the community is in short supply, as is a readership that feels so attached to its community that it cares deeply about these things.
Another very talented writer, Mark Bowden, wrote a fascinating profile of Simon in The Atlantic. If you are interested in the newspaper business, watch this season of The Wire, and read this profile:
http://www.theatlantic.com/doc/200801/bowden-wire
On the post: A Little History Lesson On How The Recording Industry Works
Re: Re: The cult of the recording artist
On the post: A Little History Lesson On How The Recording Industry Works
The cult of the recording artist
People who decide to become recording artists are just ordinary human beings who happen to have a mass-marketable talent, and have chosen to sign a record deal in hopes of making it big.
My point is not that record labels are paragons of morality, but that they are not especially different from the owners of other firms.
Our society places so much value on celebrity, and projects its own desire for youth or rebellion on recording artists, that it has invented a mythology that recording artists are victims of their industry. I am beginning to sense that even a fairly enlightened thinker can fall for this myth.
If the recording industry's actions resemble that of a pimp, it is only because society's desire for beautiful, marketable, talented musicians resembles lust. Artists enter into these deals of their own free will, with hopes of selling (or renting) their talent to a mass audience, and sign up with the highest bidder. It is a victimhood of choice. With the exception of the rare prodigy-savant, musicians have other life choices available, and many who have been "successful" might have found a more healthy, positive, and mutually rewarding bargain with society by setting their sights a little lower than international fame.
Don't believe the hype. Art is divine, but artists are not gods.
On the post: A Little History Lesson On How The Recording Industry Works
Just give it time
The internet and digitization of music has opened up new frontiers for musicians, but the record industry still is incurring the costs of fixed manufacturing assets. It is an established microeconomic principle that a business should only exit a competitive industry if, in the short term, its revenue is less than its variable costs (which are low). Simply stated, the record labels will continue to operate the CD business until they are no longer paying off the manufacturing capital; until that point is reached it is actually more costly to shut down than to operate at a loss. Maybe then we'll see significant investment in pure-play digital distribution and more creative business models than the old ones that persist today.
My point here is that we can debate the record labels' morality until we're blue in the face but the reality is that they held the economic power in the artist-label relationship until very recently. As capitalists, they exploited that power for profit and to make good on the commitments they made to their investments and creditors. They are "helping the artist" no more or less than, let's just say, the owners of a software firm that pays Chinese or Indian programmers $2 or $3 an hour to write code is helping them. When's the last time we've heard anyone on this blog or elsewhere fret about the low standard of living of this workforce, or how they're being cheated out of their fair share of profit in the software industry? Many of us have profited in the appreciated value of software companies employing this workforce, and you're probably running code written by one of them on your computer right now. I sympathize with recording artists, but they are now free to take their own risks and get their own payday, regardless of whether they or others wish to blame past failures and vulnerability on the evil recording industry.
On the post: Radiohead's Physical Album Selling Well
In Rainbows
Wired magazine recently printed an interview of Thom Yorke by David Byrne which revealed some of the nuances of Radiohead's strategy (as well as a comprehensive survey of the business models currently available to recording artists). Three facts stand out: the online sales of In Rainbows alone, even with the name-your-price option, exceeded the combined online sales of every prior album the band has ever produced; Radiohead owns all the rights to the master recording, virtually unheard of in the recording industry; and the physical CD release is a limited licensing deal, not actually a release by the band itself.
This fall's release of In Rainbows was one of the rare cases where a heavily pre-publicized event actually lived up to the hype.
On the post: Hollywood's Worried About The Wrong Thing When It Comes To Digital Archives
Re: Re: #4
Film negative used for movies does not technically have more data density per square inch than today's hard drives (although there are experimental holographic film emulsions that do). The cost advantages are process-related. For a traditional analog film archive, you simply put the material on a shelf and the costs are shipping and storage. For a digital archive, there are additional costs of transferring the media from the production server onto an archive format, backing it up, and periodically recopying as old physical formats become obsolete. The shelf life of film negative is well-known. The shelf life of a 1TB hard drive is not well-known, and is not believed to be as long as the film.
The file format used for archived media would need to have similar or identical characteristics to the file format used to edit the media, if the archived media is to have value as a raw material from which to produce future media products. The path that digital media takes from acquisition to manipulation to distribution/consumption generally involves lossy compression. When designing a path for digital media to take from acquisition to archive for the purpose of future manipulation and reuse, quality loss is not desired.
Hardware does not dictate file formats, but technical requirements influence, if not dictate, both. Consumers don't need to edit material for projection on a 70 foot screen, thus consumer electronics equipment and the formats suitable for the consumer are generally not interchangeable with professional cinema production formats. Again, the technological gap is only going to get smaller over time, but today it remains fairly wide.
I can understand that people outside of the industry might make naive assumptions about cinema technology, but I am puzzled as to why the topic of this New York Times article is drawing criticism and dismissal. There are plenty of excellent reasons to dislike Hollywood, but its desire to preserve digital media assets is not one of them. The technical challenges discussed in the article are real, and well-known to the archivists and engineers who design and operate media archives.
On the post: Hollywood's Worried About The Wrong Thing When It Comes To Digital Archives
Not so misplaced
1. There is a significant difference between the level of technology used to produce films than that used to distribute them. It is true that storage is cheap and getting cheaper. However the storage needed for the uncompressed original footage is thousands of times greater than that needed to store a finished DVD or digital cinema distribution copy. The assertion made in the NYT article that digital storage is more costly than the analog storage is correct, largely because analog information can is stored in very dense media such as a 70mm camera negative.
2. The reason that movie studios use 'proprietary formats' to archive their content is that these are the formats necessary to digitally acquire, manipulate and produce films of acceptable quality. There is no consumer market for 4K digital intermediate motion picture file formats, any more than there is a consumer market for 70mm film cameras or projectors. While the divide between consumer and professional technology is narrowing somewhat in television technology, this is not the case in theatrical films. The hardware used to produce films -- and thus the file formats used to store these images -- are simply out of reach of the consumer. Someday this will not be the case, but until then it is not valid to suggest that a motion picture studio use consumer-accessible file formats for its archives.
3. P2P storage is an effective way to efficiently distribute current and timely information. It is not an effective way to maintain a long-term archive. The studios' business model relies upon keeping its intellectual property safe and accessible for the life of the copyright, regardless of the current level of interest. Think back to the height of the Napster/Kazaa craze a few years ago. Is every pop song that you shared still on your hard drive? If so, will it still be there in five, ten, twenty, or fifty years the next time it needs to be accessed?
The basic issue here is that technology is now changing more quickly than the value of the content. To wit: if I handed you a motion picture film from 1875 you would be able to hold it up to the light and see an image. If I handed you an 8" floppy disk from 1975, it is highly unlikely that you would be able to read the data, not only because the physical media is less stable but because the equipment used to read the media has become obsolete. Part of the increased cost of digital media archives is the need to periodically recopy and convert the archive as technology advances.
Yes, the media industry in general is overly concerned about file sharing and feels unnecessarily threatened by the internet. But this is entirely unrelated to content archiving. Archivists just want to keep stuff safe and accessible, and have a completely different set of motivations than the businessmen concerned about the internet's impact on box office and DVD sales.
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