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The 'free' PC makes a comeback







The 'free' PC makes a comeback

The 'free' PC makes a comeback 12/17/2003 10:48 AM

CNN Dec 17 2003 9:48AM ET




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How the 'Free' Market Ruins the
Entertainment Media


How the 'Free' Market Ruins the
Entertainment Media
02/07/2005 01:31 AM
There's a fascinating ar ticle in this week's New Yorker by Louis Menand about the history of the US film industry. It describes what's happened to the industry since its #1 year, way back in 1946:


1946
2004
Studio films released
700
200
Number of screens nationwide
19,000
36,000
Average weekly tickets sold, all screens 100 million
24 million
Average weekly tickets sold, as % of population
72%
8%
Average tickets sold per film
7 million
6 million
Average tickets sold per week per screen
5,000
700

So now you know, if you didn't already, that the 'box office records' routinely reported to be broken are all dollar records, and that actual attendance and popularity of films, by any measure, are in a long-term and steep decline.

sidewaysThere is no great conspiracy to dumb down the industry, or to turn out less and less product each year, or to make more sequels and re-releases than original scripts, or to hype films so that most people who go at all rush out to see them before the unpaid critics, and actual movie-goers tell them how bad they really are. It's a perfect example of the 'free' market in action, and the excesses it leads to. Today between 25% and 40% of the total attendance at a new release is rung up in its first weekend. And on average 60% of the revenue comes from overseas, because, well, because there are more people and hence more undiscerning moviegoers overseas. And 35% of movie-theatre revenue comes from overpriced concession food.

The economics of the industry are now such that, in order to make money, you must have a blockbuster that will bring in hundreds of millions in its first weekend. To do that you need to 'open' on at least 15,000 screens worldwide, you have to pay at least $50 million in advance marketing worldwide, and you absolutely have to feature one or more of the "handful of stars who can open a movie worldwide", and pay each of them $25 to $150 million to do so. The margin of error is small, so you cannot risk a failure, and hence every blockbuster must follow a proven formula, like a comic book.

This hyperbolic model would be fine, for those foolish enough to continue to sustain it, if it weren't for the fact that, as Menand puts it:

Blockbuster dependence is a disease. It sucks the talent and the resources out of every other part of the industry. A contemporary blockbuster could almost be defined as a movie in which production value (sets, costumes, special effects etc.) is in inverse proportion to content. The talent, knowledge and ingenuity required to make just one of the battle scenes in 'Troy', or one mindless James Bond chase sequence, would drain the resources of many universities. But why doesn't anyone put more than two seconds' thought into the story?

The answer to Menand's question, of course, is that they don't have to. Why spend money on a well-crafted story, as director Norman Jewison said when receiving a recent life-time achievement award pleaded the industry to do, when it merely distracts from the 'production values' and needlessly reduces the bottom line? Why write a script at all when you can create a movie which makes hundreds of millions of dollars even though the star speaks only 17 lines in two hours of action (Schwarzenneger in Terminator)?

To those that think all this is just envy, Menand tells the cautionary tale of one non-blockbuster that merely attempted to present a good story with a competent ensemble of non-big-name actors, Sideways. This film, #189 of IMDb's top-rated (by audiences) movies of all time, has been a critical smash as well, but it was made for a mere 16 million dollars, excluding marketing costs, and despite all the help from critics, Oscar nominations and viral marketing, has brought in a mere 22 million dollars in ten weeks. That's a fifth of the marketing budget alone for each of the Matrix sequels, which brought in half a billion dollars each. [The picture above is a scene from Sideways].

The 'free' market has basically determined that if you want to make a quality entertainment product you have to do it as a labour of love, and if you want it to be seen you have to be willing to lose a lot of money on it (which means you need to find someone with both taste and money to underwrite it) or else let it wallow in obscurity, unknown to the millions who would appreciate it if only 'the market' would allow it any visibility. In other words, the unrestricted 'free' market in entertainment produces less, of lower-quality (according to both critics and customers). In the process, just like everything else in George Bush's America, innovation is discouraged and a tiny handful of people and corporations get obscenely rich while the rest struggle their whole lives.

And this isn't true just in the film industry -- it's true of every aspect of the 'entertainment industry' in America: Television (remember when we got 39 quality episodes a year of a well-written series like M*A*S*H?), music, publishing, 'professional' sports. In each we get less and less product, hyper-marketing, flagrant 'product placement', spin-offs and sequels, a dearth of innovation, and a handful of privileged billionaires working alongside millions of starving peers. Blockbuster dependence, thanks to the unhealthy working of the 'free' market, is making all of these wonderful trades and crafts into manufacturers of overpriced mediocrity.

The answer is the same as the solution to any other aspect of the economic, political, social or educational system that has become utterly dysfunctional -- as producers we need to establish our own parallel industries, and as consumers we need to withhold our money from from the blockbuster industry, walk away from it, stop funding it, and instead direct our business to new enterprises that enable, support and sustain entrepreneurship, innovation and craftsmanship. In the entertainment 'industry' that means supporting independent filmmakers, studios, theatres, media, musicians, publishers, and 'amateur' sports leagues. It means helping artists break free of the stranglehold of the blockbuster machine by encouraging them with our consumer dollars, and helping them organize a new, quality-oriented network of production and distribution companies.

And it means one more thing, something commonplace (though constantly threatened) in Europe and Canada, but anathema in the US -- encouraging government investment in entrepreneurship. We realized in Canada that, being so close to the US and overwhelmed by the hype of its blockbuster entertainment industry, we simply could not compete for the youth market and for space in the bottom-line-oriented movie theatres and the bottom-line-oriented commercial TV stations' schedules. So we have heavy government investment in our 'cultural industries', despite the outrage of America's NAFTA supporters. The government invests heavily in film and television production, and in supporting the publishing of Canadian musicians and authors. It has quotas on 'Canadian content' in the media. And it has whole networks paid for substantially or completely by the taxpayer, with a charter to provide an avenue for Canadian and quality foreign content. It's not a perfect solution, but the difference between the content quality on Canadian and American television, at least on a per-dollar investment basis, is startling, and a testament to the fact that, as with anything else, a balance between markets and government investment and regulation works better than either an untrammeled 'free' market or a government monopoly.

Some of the best US television, like the CSI series, originated with partnerships with Canadian companies that depend on government support, and repay it with extraordinary creativity. It would be nice to believe that indy producers and catalysts like Sundance Institute could compete with the blockbuster industry without substantial government assistance, but the evidence suggests otherwise. The business model is stacked against them. And the US has moved so far right from the days of the New Deal in its conception of the role and value of government that I wouldn't hold my breath for anyone in power to advocate a government role in funding innovation for anything except military applications. We'll have to look elsewhere for working models.

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WHY 'FREE'
TRADE DOESN'T WORK


WHY 'FREE'
TRADE DOESN'T WORK
08/29/2004 03:58 PM
zapatistas
When I was younger, I was both a socialist and a supporter of 'free' trade. Both concepts make eminent sense in an ideal world. Take away the complexity of real world affairs and debate the benefits of either concept strictly philosophically, and the 'no' side doesn't stand a chance. Unfortunately, or fortunately if you have an ideological opposition to either or both concepts, neither concept works in the real world -- in fact, they both backfire and make things worse. The problem is that the elite wealthy and powerful who control the media and most world governments are violently opposed to socialism and selfish supporters of 'free' trade. So while the myth of the viability of socialism as a workable political system has been soundly and widely discredited, the myth of the viability of 'free' trade as a workable economic system is cynically perpetuated by the powers that be.

I've written at length about why 'free' trade doesn't work: Why in a world of massive, hidden government subsidies it creates a hugely unfair playing field, how it leads to unaffordable prices for medicines in the third world and hence causes immiseration and death, why it leads to a 'race to the bottom' of social and environmental standards worldwide, how it encourages unsustainable agricultural and manufacturing processes at the cost of sustainable ones, how it leads to an inexorable deterioration in quality of products and services etc. But some of my readers still say that by advocating the repeal of 'free' trade agreements and replacing them with import duties on goods and services that cannot reasonably be produced domestically, I'm encouraging the continued impoverishment of the third world.

So here is an article, written late last year by Timothy White of Dollars & Sense magazine that shows that for Mexico, a country that has embraced 'free' trade openly and honourably, whose people have done everything they can to make it work, and whose government and people had such high hopes for it, NAFTA and 'free' trade in general have been an unmitigated disaster. If you want to know the real truth about 'free' trade, please read the article in its entirety -- it is free of economic jargon and political rhetoric, and full of astonishing data on the cost of 'free' trade to that country.

Here is the synopsis at the end of the article, emphases mine:
  • NAFTA took effect in 1994, but the "neoliberal" experiment began in the mid-1980s following Mexico's 1982 debt crisis. Ten years into NAFTA and nearly twenty years into neoliberalism, the track record, drawn from official World Bank and Mexican government figures, is poor:
  • Economic growth has been slow. Since 1985, Mexico has seen average annual per capita real growth of just 1%, compared to 3.4% from 1960 to 1980.
  • Job growth has been sluggish. There has been little job creation, falling far short of the demand from young people entering the labour force. Manufacturing, one of the few sectors to show significant economic growth, has registered only marginal net job creation since NAFTA took effect.
  • The new jobs are not good jobs. Nearly half of all new formal-sector jobs created under NAFTA do not include any of the benefits mandated by Mexican law (social security, vacations, holidays, etc.). One-third of the economically active population now works in the "informal" sector.
  • Wages have declined. The real minimum wage is down 60% since 1982, 23% since NAFTA's inception. Wages in all sectors have followed suit.
  • Poverty has increased. According to Mexico's most respected poverty researchers, the number of households living in poverty has grown 80% since 1984, with nearly 80% of Mexico's people now below the poverty line, up from 59% in 1984. Income distribution has become more lopsided, making Mexico one of the hemisphere's most unequal societies.
  • The rural sector is in crisis. Four-fifths of rural Mexicans live in poverty, over half in extreme poverty. Migration levels remain high despite unprecedented risks due to increased U.S. border patrols.
  • Imports surpass exports. The export boom has been outpaced by an import boom, in part due to intrafirm trade within multinationals.
  • The environment has deteriorated. The Mexican government estimates that from 1985 to 1999, the economic costs of environmental degradation amounted to 10% of annual GDP, or $36 billion per year. These costs dwarf economic growth, which amounted to only $9.4 billion annually.
This is a story that could be told and re-told in almost any third-world country. African and Asia agriculture has been devastated by heavily-subsidized European crops just as Latin American agriculture has been crippled by heavily-subsidized North American crops. The environmental destruction wrought by business in the third world, and the criminal, dangerous, inhumane working conditions of workers, mostly run by manufacturing and mining businesses owned by or dependent on Western imports, is a global disgrace. 'Free' trade is in fact a massive fraud designed to further enrich a small number of multinational corporations and the governments they control. There is a reason for the huge, spontaneous global demonstrations against 'free' trade and globalization: People around the world directly affected by it know it is a scourge, a power and wealth grab by those who already have far too much of both. The multinationals are attempting to get additional 'free' trade agreements signed before the rest of the world wakes up to the reality of their enormous cost and inequity. They continue to argue about the theoretical benefits of 'free' trade, and blame its failings on corrupt third world governments. This is a smokescreen, and White's article eloquently shows the real motive for wanting 'free' trade agreements signed: pure greed.

The alternative to 'free' trade is not no trade, it is trade regulated for the benefit of the world's people. Regulation is not a dirty word, no matter how aggressively neocons try to paint it as such. It is our only protection against corporatists who put profit before people.

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Internet Round Three - The Big Comeback?


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