Chris Anderson was nice enough to send me a review copy of his new book, The Long Tail, which has been storming the best-seller lists. So far (a third of the way through) the book lives up to the hype: it’s a quick read that’s packed with interesting stories and insights about the changing rules of the information economy. If you haven’t gotten your copy yet, you should.
For those who haven’t yet encountered Anderson’s work, he argues that by reducing the costs of distributing information, the Internet has radically expanded the set of products that are economically viable. A big Wal-Mart might have 5,000 CDs on its shelves, but at the iTunes Music Store, I can choose from among hundreds of thousands of albums. Anderson dubs these less-popular works the “long tail” of music, and he demonstrates that while each of these “misses” aren’t commercially significant by themselves, when you add them up, they comprise a significant part of the total demand for music. Anderson demonstrates that the same phenomenon can be found everywhere you look: Amazon makes a substantial fraction of its book revenue from books that can’t be found in any Borders. A substantial fraction of Netflix rentals can’t be found in any Blockbuster.
Anderson’s book explores the implications of this shift. He argues that once consumers have the option of wandering far from the beaten path of mainstream hits, many of them discover stuff they like a lot better than the mainstream fare. Now that “long tail” products are readily available, the demand for them is growing, as more and more consumers find new products they never would have found in a pre-Internet age. This, in turn represents a serious threat to the hit-dominated culture of incumbent content companies, whose businesses are carefully tuned to cranking out mainstream fare that will appeal to the broadest possible audience. The upshot is that over time, the tail will be more an more important, transforming our culture from the homogenous, hit-dominated world of the 20th Century to a decentralized culture with thousands of micro-niches of varying sizes. In short, Anderson argues that the blockbuster isn’t an inevitable feature of modern media, but rather is an artifact of the centralized distribution technologies of the 20th Century.
I don’t have any real quarrel with that thesis. But “what he said” doesn’t make for an interesting blog entry, so below the cut, I’ll offer a quick criticism.
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CNet has a harsh review of Amazon’s new video download service:
I left work after that and rebooted my laptop at home. That’s when the real trouble began. I noticed that the Amazon player had launched itself. Annoying. I looked in the program for a preference to stop it from launching itself, and there was none. Typical. So I went to msconfig and unchecked Amazon Unbox so that it would definitely not launch itself at start-up. When I rebooted, it was no longer there. However, my firewall warned me that a Windows service (ADVWindowsClientService.exe) was trying to connect to the Net. I clicked More Info in the firewall alert and found it was Amazon Unbox. Downright offensive. It still was launching a Net-connection process that even msconfig apparently couldn’t stop. Forget it. That’s not the behavior of good software. I went to uninstall it.
After the Install Shield launched and I chose uninstall, I got a login screen for my Amazon account. I just wanted to uninstall it. I shouldn’t have to log in to my account to do that. So I canceled the login, and the uninstall failed. I tried that three times, and it failed each time. Finally I gave up and logged in and the uninstall finished.
So, in summary, to be allowed the privilege of purchasing a video that I can’t burn to DVD and can’t watch on my iPod, I have to allow a program to hijack my start-up and force me to login to uninstall it? No way. Sorry, Amazon. I love a lot of what you do, but I will absolutely not recommend this service. Try again.
As Ed Felten has explained, it’s not a coincidence that DRM software tends to act like spyware.
Via Patri Friedman, there’s a controversy brewing over the boundaries of online privacy. Ryan Singel at the Wired blog has a good summary:
A guy who identifies himself as Jason Fortuny, a 30 year old network administrator, posted a graphic ad on Seattle’s Craigslist, pretending to be a woman wanting some BDSM sex.
Not surprisingly, many men responded, many with photos and more than a few with pics of their genitals.
Some used their work accounts, provided their real names and gave out their cellphone numbers. One looks to be a contractor for Microsoft, while another used a .mil address to reply.
Fortuny, whose MySpace profile says he likes to “push people’s buttons” then posted all the photos and correspondence on what may be the web’s lamest wiki, Encyclopedia Dramatica.
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As I mentioned back in July, Tim Carney was kind enough to send me a review copy of his new book, The Big Ripoff. With dozens of example, Tim does an excellent job of documenting just how frequently Big Business and Big Government are in bed together.
I particularly liked chapter 7, “Regulators and Robber Barons,” which is chock full of real-world examples of regulatory capture. Carney demonstrates that much of the time, the standard media story of big government pushing regulations on businesses and businesses resisting them is wrong. In many cases, what happens is that established businesses argue in
favor of regulations that they perceive as hurting their competitors (often smaller competitors) more than themselves. For example, in 2001, the largest biotech companies lobbied for increased FDA scrutiny of biotech crops which, as the FDA’s own proposed rule acknowledged, would have a disproportionate impact on smaller biotech companies that lacked the resources to jump through the FDA’s hoops. He tells the story of FedEx, an upstart cargo carrier who in the 1970s was prevented from expanding by government regulations that were strongly supported by the Flying Tigers, the then-dominant air cargo company. And he discusses the controversy over “a la carte” cable regulation, which most of the cable industry opposed, but which CableVision–a company that had already invested in the equipment to offer a la carte services–lobbied for. Carney argues that CableVision calculated that imposing a la carte mandates would hurt its competitors more than it would hurt itself.
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The Bush administration has been dealt another setback in litigation over its NSA surveillance program:
In this particular case, one of the plaintiffs, the Al-Haramain Islamic Foundation, claims that the government froze its assets during an investigation prompted by a warrantless wiretap, a claim that is verified by classified documentation (referred to in the judge’s decision as the Sealed Document) inadvertently given to the plaintiff. The government claims that national security would be threatened if the government confirms or denies the assertion that Al-Haramain was the subject of wireless eavesdropping. The basis for government’s argument extends from the belief that a suspect who knows himself to be a target of government surveillance could “change his pattern of behavior, jepordizing the ability to collection intelligence information.” The judge points out that the government’s argument is irrelevant in this case, because “the government already inadvertently disclosed the Sealed Document to plaintiffs, thus alerting the individuals or organizations mentioned in the document that their communications have been intercepted in the past.”
The government also claimed that, should the lawsuit be allowed to move forward, national security would be at risk, simply because certain details of the case could potentially be accumulated to reveal additional details. Known as the “mosaic” theory, the government’s argument is “that any disclosure of any information related to the Surveillance Program or the Sealed Document would tend to allow enemies to discern, and therefore avoid, the means by which surveillance takes place under the program.” The judge rejected this assertion, because he does not think that the case will necessitate public disclosure of “information regarding the al Qaeda threat” or “non-public details of the Surveillance Program.”
Any terrorist stupid enough not to worry about the U.S. government eavesdropping on him is probably stupid enough not to be a serious threat. And you could make the same argument about
any surveillance program.
Indeed, that’s why Congress set up FISA in the first place. They wanted to give the executive branch a leak-proof forum for getting judicial oversight of its top-secret surveillance activities. If the Bush administration had gone through the FISA process, or lobbied Congress to change the FISA process to accommodate their new program, they wouldn’t be in this situation. But instead, they chose to simply ignore the law and conduct their illegal surveillance program without judicial oversight. The chickens are now coming home to roost.
Amazon has unveiled its long-rumored video download service. I share Randy Picker’s skepticism about the service’s potential for success:
You get content through the Amazon unbox video player, which is the control center for managing downloads and control over the content. Once the show or movie is downloaded, you can watch it on your computer or on an approved video device (but no iPods or Macintoshes and nary a word about Linux). And if you know how to do it, you can hook your computer up to your television and watch the TV show there.
All of that is reasonably straightforward, until you start to break it down. Although this is video on demand, you need to plan your demand a day in advance. Amazon estimates that it will take more than seven hours to download a two hour movie over a 750 kbps line. The system does implement progressive download, meaning that you can start watching immediately as the content comes, but at these download rates, you’ll run out of content quite quickly.
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Every week, I look at a software patent that’s been in the news. You can see previous installments in the series here. One of the amazing thing about the software patent issue is just how pervasive software patent litigation is. When I started this project, I was afraid I’d have to scramble to find a new controversy to write about each week. Boy was I wrong. Most weeks, like this one, all I’ve had to do is run a Google News search for “software patent” and there’s new lawsuit on the first page of results. This week’s dispute is between i2 and SAP over seven patents related to project management software. Here is the oldest of the seven patents.
This patent is akin to the Guatemalan database patent and the Friendster patent I covered in previous weeks: it seems to simply describe a software product in great detail, as if a list of mundane features constitutes an invention.
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I’m pleased to see that Tim Wu took the time to respond (here and here, scroll down to the bottom of the comments) to my recent posts on his paper on Hayek and intellectual property. Here’s what he had to say on the spectrum issue:
The point made by Tim Lee is decent. It is certainly true that the FCC would have to state some kind of standard to make possible permissionless entry into the spectrum market (as it does for the garage band used by 802.11b). In addition, private actors could, if they wanted, similarly allow permissionless use of spectrum. The question is why they would want to.
In general I cannot understand the strength of Jerry’s and others’ objection to the substance of rules that would create permissionless market entry into the spectrum market. In my view, reflected in that paper, permissionless market entry is one of the holy grails of an effective market system.
Perhaps Jerry will jump in with his thoughts, but I think it’s crucial here to distinguish between short-range and long-range spectrum. For short-range transmission, Wu’s argument has a lot of merit because short-range wireless applications are nearly non-rivalrous. Cordless phones and WiFi seem to work quite well in an unlicensed environment.
A big part of the reason for this is that there are only a handful of people who want to transmit short-range signals in any given geographical location. There are only half a dozen WiFi networks within range of my apartment, and I live in a dense urban environment. Because I’m only competing with a handful of people, informal sharing mechanisms work pretty well. In this case, the WiFi protocol can operate on several different “channels,” and access points self-organize by selecting a channel where their signal won’t interfere with others (at least that’s my rather limited understanding of it–geeks please correct me if I’m wrong).
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Forbes has a profile of Mark Shuttleworth and Ubuntu. What I found most interesting about it is the financials:
Ubuntu now has 4 million users, half of which are governments, universities and a smattering of businesses. It adds new ones at a rate of 8% per month. After its public release in October 2004, Ubuntu quickly deposed Red Hat’s Fedora as the most popular version of Linux on DistroWatch, a Web site that caters to Linux users. Ubuntu works in 22 languages, and Canonical, the company Shuttleworth set up to distribute his software, will send a free Ubuntu CD anywhere in the world. New users rave about the simple user interface, which has gained recent converts in a couple of well-known bloggers who switched from Apple Computer’s OS X.
In May, Sun Microsystems announced plans to offer Ubuntu on Sun’s Niagara chips, which power its newer Sparc servers. While Sparc servers aren’t a particularly big market, the stunt made clear that Shuttleworth aims beyond home hobbyists.
Canonical has burned through $15 million of Shuttleworth’s money in two and a half years. He says that it will take him at least another two years to even know whether it has a chance to become profitable, and that it may never return his investment. But that doesn’t matter. He’s paying all the bills either way, along with setting up a $10 million endowment for the Ubuntu Foundation that’s earning interest for a day when his attentions may drift elsewhere.
I mean no disrespect to Mr. Shuttleworth when I say this, but $15 million is a shockingly small amount of money with which to build a full-featured desktop operating system. Microsoft’s
advertising budget for each version of Windows is an order of magnitude larger than that. Apple pulls in hundreds of millions of dollars with every release of Mac OS X, while Microsoft makes billions of Windows.
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MySpace is getting into the music market. And to help set them apart from the pack, they’ve opted for a decentralized approach: anyone can offer their music via MySpace, and pricing is controlled by the artist. Moreover, MySpace has opted to offer the music in MP3 format, unencumbered by DRM.
Joe at TechDirt gets the implications of this exactly right:
while many of these music stores are simply iTunes clones, MySpace is trying something different. It’s going to offer a way for bands to sell music directly to fans from their MySpace pages. Furthermore, the songs aren’t DRM’d so they’re not tied to a particular device, and the band controls the price at which they’re sold. Bands are already building up followings on MySpace, but have lacked a way to turn popularity into commercial success. This store will try to solve this problem. Predictably, there’s already talk of whether MySpace can unseat the dominance of Apple in the digital music space, but that misses the point. It’s the record labels themselves that should feel threatened. Not only has MySpace already given young bands an avenue to reach the masses, without a label to pay for their promotional campaigns, but now it’s giving them more control over their distribution as well. The value added by signing with a label is clearly diminishing, and their fortunes are likely to follow.
The labels’ traditional strengths were in distribution and marketing. Their distribution advantage is effectively gone, at least among the under-40 crowd that mostly listens to music on their iPods. And their promotional advantage is fading as more young people find new music on the Internet rather than traditional broadcast media.
As a result, the labels are largely coasting on inertia. Because they’ve got contracts with the vast majority of popular artists, people are in the habit of looking to them for new music. That, in turn, makes their artists more likely to succeed, which in turn makes the best artists more likely to seek contracts from them. It’s a virtuous cycle that’s allowed them to continue to dominate the music charts even as their distribution and promotional network is rapidly rendered obsolete.
But the momentum won’t continue forever. Sites like MySpace will make it ever easier for bands to find fans without the help of the labels. And once a substantial fraction of rock stars aren’t beholden to the labels, the labels’ remaining advantages will evaporate. At that point, their high overhead and history of hostility toward their customers will come back to haunt them. Consumer are likely to find getting music on MySpace to be cheaper, more convenient, and more interactive. And once bands can reach their fans directly, why bother with the middleman?
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.