Why TV Lost

Rarely do you see things put so susinctly. Sometimes I could just kiss Paul Graham, but that would be kind of weird and creepy. :)

He captures the inevitability of the TV vs. Internet war, the sheer obviousness and the magic and slaps it all down in a few hundred words like it was meant to be.

From: Why TV Lost

About twenty years ago people noticed computers and TV were on a collision course and started to speculate about what they'd produce when they converged. We now know the answer: computers. It's clear now that even by using the word "convergence" we were giving TV too much credit. This won't be convergence so much as replacement. People may still watch things they call "TV shows," but they'll watch them mostly on computers.

What decided the contest for computers? Four forces, three of which one could have predicted, and one that would have been harder to.

One predictable cause of victory is that the Internet is an open platform. Anyone can build whatever they want on it, and the market picks the winners. So innovation happens at hacker speeds instead of big company speeds.

The second is Moore's Law, which has worked its usual magic on Internet bandwidth. [1]

The third reason computers won is piracy. Users prefer it not just because it's free, but because it's more convenient. Bittorrent and YouTube have already trained a new generation of viewers that the place to watch shows is on a computer screen. [2]

The somewhat more surprising force was one specific type of innovation: social applications. The average teenage kid has a pretty much infinite capacity for talking to their friends. But they can't physically be with them all the time. When I was in high school the solution was the telephone. Now it's social networks, multiplayer games, and various messaging applications. The way you reach them all is through a computer. [3] Which means every teenage kid (a) wants a computer with an Internet connection, (b) has an incentive to figure out how to use it, and (c) spends countless hours in front of it.

This was the most powerful force of all. This was what made everyone want computers. Nerds got computers because they liked them. Then gamers got them to play games on. But it was connecting to other people that got everyone else: that's what made even grandmas and 14 year old girls want computers.

After decades of running an IV drip right into their audience, people in the entertainment business had understandably come to think of them as rather passive. They thought they'd be able to dictate the way shows reached audiences. But they underestimated the force of their desire to connect with one another.

Facebook killed TV. That is wildly oversimplified, of course, but probably as close to the truth as you can get in three words.

Music sales boom, but albums fizzle for '08

Americans bought more music in 2008 than ever before, but album sales — the music industry's main source of revenue — dropped for a fourth year.

According to the Nielsen Co.'s year-end figures, music purchases — CD, vinyl, cassette and digital purchases of entire albums (grouped together as total albums), plus digital track downloads, singles and music videos — attained a new high of 1.5 billion, up 10.5% over 2007.

More than 70% of those transactions were digital track downloads, a record total of 1.07 billion that swamped 2007's previous high of 844.2 million by 27%. Last week's track downloads set a record of 47.7 million, and 71 songs exceeded 1 million downloads this year, compared with 41 last year (and just two in 2005). Track downloads outsold albums by a ratio of 2.5 to 1.

Total album sales dropped to 428.4 million, 14% fewer than in 2007, and have fallen 45% since 2000. Even combining album and track sales (by a formula that counts 10 track downloads as one album sale), the 535.4 million total is still down 8.5% from 2007 and more than 30% below 2000's physical album sales of 785.1 million.

Music purchases are "astronomically high," says Rob Sisco, Nielsen's president of music, "but it's a marketplace in transition from physical to digital." He sees promise in the rise of digital purchases of entire albums, which reached a high of 65.8 million in 2008. New albums by big acts bring the market up, he says, but "there hasn't been a steady stream of high-profile releases."

Music sales boom, but albums fizzle for '08 - USATODAY.com

Wow, it's starting to happen. Exactly as predicted. The advantages of digital distribution now that music is starting to be sold DRM free are starting to really outshine the disadvantages of piracy.

Generally these advantages of digital music sales are summed up as a growth in the depth and breadth of music. A debate I've posted about here in the past.

Specifically it goes something like this.

1) The market of people whom have access to purchase music as it goes digital grows exponentially... it becomes truly global.

2) Love of music is not innate, people can exist without buying any music at all. They can make it themselves in fact and be just as happy. Music interest like all art is cultivated and cultured. People aren't born loving Rothko or PIcaso, they develop a taste, the same goes for Britney Spears. (Eeee. A shiver just went down my spine.) More access to music, more accessibility... more commons = more cultured tastes = huge growth in people's purchasing habits in the mid and long tail

3) people's individual capacity for music is growing exponentially now that it's not encumbered by the physical limitations of CD's.

To put it bluntly I can't wait for the first terabyte mp3 player. I can't imagine what will fill it, but it would be stupid to say say as Bill Gates once did... "I only ever see a need for the individual to have X amount of memory". While this is paraphrased badly, the point is clear, don't be naive about people's capacity to consume and collect nor the ability of new formats to take advantage of that capacity.

I could see music formats of infinitely higher quality, where not only is each instrument a separate track, but each instrument has multiple channels. Who knows where it'll go but I think it's safe to say the mp3 is the wax record of its day.

In the end the death of the CD will have been the best thing that ever happened to the music industry spurring HUGE growth across the board in every area of music from the head to the tail. US citizens will discover musical interests all over the world and we'll discover the rest of the world hasn't even begun to explore the US market.


The only thing limiting the success of the music industry in 2009 will be as always the major labels themselves.

1) While DRM is on the way out, DRM cannot die fast enough. Expect it to stage failed comeback after failed staged comeback though. Everyone loves the unicorn.

2) New competing storefront alternatives are needed to spur innovation in the marketplace, but are limited by the labels arbitrarily picking winners and losers completely contrary to their innovations and contributions. Expect this to continue to slow what would otherwise be extremely rapid innovation and evolution. I.E. Expect to be stuck with the mp3 for a great number of years to start with.

3) geographical barriers thrown up will slow the exponential growth from new world markets slowing the global trend.


All this of course has nothing to do with piracy, that which the major labels fear. In fact as has proven time and again (most obviously with the video game Spore) it directly pushes the market away from the incumbent creating the demand in the p2p black markets and a more demand for independent and alternative artists. Neither are a bad thing for anyone except the major labels... so as is oft said, f*ck em.

In conclusion. Music sales will grow exponentially in 2009 greatly surpassing even the wildest dreams and expectations despite the major labels complete ineptitude. This growth will happen in all areas but CD sales, though even that may eventually even come back in 2-5 years just as vinyl has. Oh, nostalgia.

Darknet culture and the Harry Potter leak

My friend Raymond from Copenhagen did an awesome write up on some of the behind the scenes culture that went on before the Harry Potter leak and the corresponding Newsweek article.

It's truly fascinating and unlike anything I've read before.

Re: Evil Vlog is... Darknets and the Harry Potter leak

Here are some Cliff notes on his writeup and the corresponding Newsweek article

1) the NEWSWEEK writer admits to downloading, or at least attempting to download, a pirated copy of the book

2) it's overwhelmingly obvious based on the opinions of those in the Newsweek article this leak will in no way effect sales of the book and does in fact enhance the experience of the fans.

2) What really undermines and subverts the piracy efforts are scores of fan fiction... only a true fan would be able to tell the real from the fake.

4) Raymond's posts takes a look at the behind the scenes culture and collaboration on transcribing the book by multiple groups who are all competing to be the first to release a pirated copy. They are not driven by anything other than pride and being big fans.

5) Raymond's post documents the remarkable transparency of these groups, even documenting the Newsweek reporters direct contact with one of the P2P groups transcoding and leaking the book on Pirate Bay.

6) The Newsweek article while pointing out the inherent impossibilities in stopping piracy both inside the publishing world and by fan culture also documents how remarkably pervasive watermarking technologies are getting. While the age of DRM may be finally slowed or stopped moving forward we're now entering an even more dangerous age of ubiquitous watermarking. Soon every digital good you make and every digital good you buy will be watermarked and traceable back to you. This is a very scary thought, which has implications well beyond piracy such as freedom of speech.

Hopefully more later, that was just the cliff notes.