Tuesday, June 30. 2009The Free Market for Snake Oil and the Age of UnreasonTrackbacks
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If you have more respect for the LSE than for the RSA, then the economist you should be reading is Danny Quah, who has been publishing on the "Weightless Economy" for over ten years now.
There is no snake oil in the economics of books, CD's and newspapers. They all have high fixed costs and low marginal costs, but they all have revenue models that rely on distribution being physical, costly, and impossible to avoid. When I buy a book, I pay for 500 grams of paper, just so that I can read the words printed on it. But if I can have the words without the paper, I will, and I'll collect them myself from the author, and I won't want ninety percent of the cover price to go to a distributor. The publishing business model is dying because distribution no longer adds economic value.
You are absolutely right, and I'm not arguing publishing will survive as is - but the distribution bit is:
(i) not free in new media either, just cheaper (ii)not the only bit of the value chain, and digitisation hasn't reduced these other costs nearly as much. The snake oil is in believing the above 2 areas are also free, or can be covred by a tiny % paying freemium rates.
I think one reason why Gladwell's review captured so much attention was the surprise at one of the main producers of The One Big Idea form of business books turned on another. You could as easily apply the thrust of the last sentence of the New Yorker review to Gladwell's own work as to Anderson's or any other number of authors of fashionable one-chapter ideas stretched out to 100,000 words.
Perhaps one reason why the showman tours work is that the audience realises that they don't really have to wade through the text, just turn up for an hour.
But was the Age of Old Media really the age of reason? Has broader access to media distribution channels really changed the dynamic or merely applied it to a larger scale?
Meaning: there has always been an uneven distribution of megaphones, why does this new distribution lead to less reason (on the average, at the median, overall)?
@Chris more than that - Gladwell parked tanks on the whole Web 2.0 lawn because he is asserting that its underlying economics are bollocks - goes far further than just Anderson
@Taylor my thought was that the old papers used to have to pay lip service to giving 2 sides, whereas most blogs do none of that. Also
"The economic version of a perpetual motion machine". Very nicely put.
Alan: ah, agreed. Old paper journos knew how to cover themselves because they knew it was a long-term, multiple-term game, whereas most newer entrants (bloggers, etc.) are newer to the game.
I was thinking about how there always used to be inaccurate information spread within social groups, but since it was hard to dip into those groups we couldn't "see" or "hear" about the inaccuracies and faulty logic; but now we can. I always try to think about if the behaviour is truly different, or if we're just now more aware of what's always existed. But that's beside the entire "free" debate. I'm glad the debate is re-emerging, simply because it's been fundamentally misunderstood for a long time. |
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