The Unforeseen Consequences of Entertainmentality
Storage technology is improving in performance one order of magnitude every five years (Schwerin’s Law, first theorem). Each main segment of technology is one generation apart in performance, i.e. for a given capacity of fixed magnetic, removable optical is one order of magnitude behind, and solid state one order behind that (Schwerin’s Law, second theorem). Storage technology is thus progressing along a similar trajectory as Moore’s Law. Transmission bandwidth and display resolution, which along with processors and storage form the four sectors of digital CE and PC devices, also proceed at a similar velocity of change over time.
Content delivery technology is both network and physical in nature, i.e. transmitted or stored locally. Data transmission from a remote host is best suited for infrequent access or rapidly changing content, whereas delivery to local storage suits archiving content which is frequently accessed but does not change rapidly.
Where the content is affects the fortunes of many enterprises, i.e. when the content is stored remotely and transmitted on demand or on a schedule, the delivery fee goes to the network and back-end IT firms, but when the content is stored locally, media manufacturers get the payment and consumer electronics firms because devices that store content are more complex.
At the end of 2004, about 158 million households have broadband and/or HDTV access, while about 196 million CD and DVD recorders are installed worldwide according to Infotech research. Recorders are also readers of prerecorded, replicated content such as CD and DVD discs. The next generation blue laser discs will come on the market this year, and will set new sales records over their life cycle for both local storage of files received legitimately or not over the internet and for files created by users in the content commons, stimulating a new generation of prerecorded HD movies for playback and games for play. PC vendors will incorporate them as storage peripherals, they will be in set-top videogame and DVR boxes, and they will be part of home network hubs. Dell and HP, who together control nearly one-third of worldwide PC sales, have already announced plans to attach blue laser disc recorders to their PCs.
Infotech Epic Struggle #2. Restricting supply increases demand.
Well, sort of. Restricting access to copyrighted content may or may not result in fewer copies of content in circulation from sources other than the owner’s authorized representatives, but there is no evidence that this will result in more copies being purchased through legitimate channels. There is no evidence that the rise in peer to peer file sharing was responsible for the decline in record sales.
It is a logical fallacy that two things that occur sequentially necessarily have a causal relationship. The marked decline in records produced by the majors immediatiely prior to and throughout the last three years of reduced sales could have been a factor, but this data was removed from public disclosure by the label’s trade associations who disseminate record sales statistics. The increase in home video purchases at the same time could also have played a part in competing against record sales for relatively fixed consumer spending. FCC rules allowing greater concentration of media ownership rules that resulted in Clear Channel top 40 radio domination has also been cited as a factor limiting the important radio previewing of new music. The failure of the record companies to participate in producing higher fidelity recordings and music videos on DVD to re-ignite interest in audio programming has been cited. Some have even suggested the disconnect between the taste of A&R execs and the public is to blame, but we wonky types won’t go there.
If increased file sharing were the cause of music sales declines, than the reverse, decreased file sharing as the cause of music sales increases, would be higher in probability. The IFPI, the worldwide record industry association, reported the wildly positive news that music sales worldwide fell 1.3 percent, to $13.9 billion, in the first half of 2004 and that unit sales rose 1.7 percent, to 1.22 billion.
Laws restricting access to entertainment and information content were not formulated by the people, for the people. Unless the people are the content owners, that is. As consumers increasingly perceive loss of control over copyrighted content, their instinct to control it and to hoard it locally will increase. The more you take away rights, the more many will insist on keeping them. This will keep storage in growing demand, and growing according to Schwerin’s Law. As in the struggle above, network operators will be competing with CE and PC manufacturers for value-added opportunities with content above the table and under it.
In a perfect world, the celestial jukebox would work like the big screen in a George Jetson cartoon. Ask for what you want to watch, hear, play or know and you receive instant content gratification. Nobody asked Judy for a password, a credit card, a site member number, a signed usage rights agreement, or a fingerprint. Nobody informed her the rights to view the following content are limited, exclusive, expensive, and that doing anything else with the information than experiencing it just this once would subject her to legal and financial penalties. Who would have thought that turning a friend onto a great record would earn you a criminal record?
Content providers could learn to love having all content controlled at the source, metered out for consumption, never possessed by the consumer to copy and distribute in an unauthorized manner, and uncapturable. Consumers would have to pay to play, but could never physically archive it. Somehow, this seems potentially unpalatable.
Today, we do not have the technology in place for Video on Demand for any and all content. We are testing VOD pricing with online song downloads, however, allowing consumers to access a certain number of copies of a song, but only if they continue to pay the vendor. Digital Rights Management implementation is an opportunity to raise prices, as well as restrict access. But resistance to exclusionary content and insistence on privacy in consumption may yet be the instigators of the restoration of rights lost to piracy control.
Infotech Epic Struggle #3. Creative Commons.
Prerecorded content is not the only form of entertainment for consumers. Creating content in the form of blogs like this one, music recordings such as on personal websites, home videos and still photography is a rapidly growing business. This content creation represents an even greater investment in the more sophisticated content creation devices than playback of local content or reception of remote content require.
People who use computers a lot, which is most of us in the developed economies of the world, have a trust issue when it comes to content storage. We don’t. Therefore, we back-up on removable media. We may also take archive copies offsite. It is difficult to imagine, given this psychological tendency, that many people will want to upload their creations to a remote storage site, except for the purpose of distribution.
Years ago, back before there was prerecorded content broadcast to our living rooms and shelved next to the classics in our dens, people made their own entertainment. People in places where a legitimate CD costs a day’s or even a week’s wages still do, but they don’t have the means to capture it. People who can afford computers can, and there is some evidence to suggest that, given the authoring and composition tools, or even the tools to mix and mash samples of other content, they do want to capture it. And some of those people will also want to distribute it in the creative commons.
Access to content distribution channels to do so may become a new epic struggle. Protection of content access is the high profile one we have wrestled with for the last three years, while the right to distribute copyrighted content over the network or on media, signals vs. atoms, is large yet largely hidden.
The next few years will be interesting ones for copyrights. Protection of content against pirates who resell it may require distinguishing from people who want to share it in a community sense. Apple and other PC manufacturers may determine that a creative media application for personal computers is the next big thing, putting more tools for not only making movies and music from scratch but also from mixing and mashing samples from other sources. Hardware vendors whose own patents are abrogated by device manufacturers who elude the licensing requirements may develop renewed respect for IP legal protection and enforcement. Content providers may awaken to the stunning realization that enlightened pricing and proactive new media distribution initiatives stimulate demand and may trigger a new renaissance for prerecorded creative content.
posted by julia b schwerin