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|User Info||Whistling Past the Dead Netflix, You Be...; entered at 2017-08-12 18:19:12|
Registered: 2017-06-16 Los Angeles, Ca
This post isn't directed at supertruckertom (maybe to people who think we are really booming), it was more inspired by his post. I really want to try to express to people what's at stake.|
I got good news and bad news. Bad news: you have cancer. Good news, though: it's booming!
When we talk of growth and booms we have to qualify what we're talking about. There's this idea that blanket growth is good, because we're taught growth, growth, growth. When growth went unqualified and beyond reasoned measure the Ancients called this "overreaching", and it had disastrous results.
Many people think that the majority of players in the NFL are millionaires. This is far from the case, where only a handful of players on a given team even net a million dollars (and yes, the average player does earn well above the median income, but they have a much, much, much shorter window of earning potential). On a 53 man roster, at least, 45 of those players are role players.
Now here's the thing. If you're a star player and you get cut or traded, typically you won't find out about it until ESPN broadcasts it. The General Manager or his office won't contact you. Partly because a star player negotiates his contract as an individual because he has leverage. However, role players are fired or traded rather nicely. They sit you down, say nice things about you, wish you luck, and so on. Why is this? Because the vast majority of the team consists of role players. So if I treat you badly because you are a role player, you're likely going to get a bad reaction from the team. See, an owner can still field a team without a star player, they can't field a team at all without the role players.
The content business use to run on the Pareto Principle, commonly called the 80/20 rule, that is, 80% of the effects comes from 20% for the causes. Basically, 80% of the revenue was generated by 20% of the content. So let's go back a few years, 2013, the top 1% of music artists accounted for 77% of all artist-recorded music. http://www.promus.dk/files/MIDiA_Consult....
I use 2013 because the research consultant firms that conducted the research have released those reports to the public (obviously for current numbers they'd want to get paid). Are we to suppose that the situation has gotten better? So yes, there's movies, music, and books that are making money, but they're fewer and fewer and they're all previously branded stuff typically. That's the thing about creating content solely though data: it can only create content you already like or know about. Just look how awful Google's ad sense and ad words is.
This is what they mean by the 1% economy, it's the consolidation of wealth and power. There's many reasons for how and why this has happened, but one thing that's easy for people to grasp is data mining. So, perhaps Google and others can get better at their data being predictive, sure, if you're willing to let them into your house.
But even top selling artists have to product place into their acts. Lady Gaga's infamous Doritos performance. Even a high grossing performer like Jay-Z has to product place in concerts. This of course ends the notion of the independent artist. But it's booming, right? Try putting your content on Youtube and they demand 45% of the ad revenue without sharing any of the production costs. Or wait until Youtube goes to negotiate with Merlin Agency and see what kind of deal they'll get. Who's Merlin Agency? And agency that represents a collective of indie labels in digital media.
Web 1.0 promised the democratization of distribution. Except it's ended up in fewer hands.
Web 2.0 the sharing economy. Except it's ended up in fewer hands.
And now Web 3.0, the DIY economy (do it yourself), or the maker economy. That's 3d printers where people can make their own items like clothing--intellectual rights on clothing designs, yeah that worked out great for music, film and books....it'll end up in fewer and fewer hands.
When Andrew Keen interviewed Dale Daugherty, the guy championing the maker-economy, he asked him what's going to happen with everyone in the textile industry in unemployed? Keen said Daugherty didn't respond. Even he's not sure what kind of world that will be.
Technology advancing is one thing, the total disregard for the law and common decency is a totally different thing, but it's on the internet so it's okay. Hey, I like that band, I think I'll bankrupt them by pirating their content.
And the thing is, this was not at all what the early implementors of the internet and the web in the 1980s and early 1990s envisioned--because they're very much alive and say so. But by turning YOU into a product through data mining, they've been able to devalue everything else.
Even Silicon Valley for the most part hasn't benefited. In Santa Clara County, the geographical heart of Silicon Valley, in 2001 after the dot-com bust the poverty rate was 8%, but in 2013 it was 14%, food stamps in 2001 was 25k, jumped to 125k by 2013. Silicon Valley doesn't even create jobs in their own area. Because they form start up to get funding, and then the top people pay themselves, try for another round of funding, and so on. That's their business, not production but getting funding. Silicon Valley has one of the shortest employment lengths than any other industry, just about competing with the NFL. Start ups tend to fire 25% of their staff in the first year. Then the "founders" jump to another start up, get funding, then dump it, and so on. The business model is about funding, not production. That's all Tesla has proven to be.
With Netflix, because the content gets poached by pirating, they then poach the networks, and then the networks poach the consumer and so on. It creates an entirely perverse system as everyone is trying to survive. But it didn't have to be this way, nor does it need to remain this way. It's literally become lawless.
Of course star players are needed, but without the role players you can't even field a team. Every General Manager and coach who doesn't understand this is out of a job quick.