Wednesday, July 1, 2009

Newsies: Recapture The Serfs!

Newspapers are being fed feet-first into the whirling teeth of history’s shredder – they’re in at about knee-level now – and it’s making them understandably cranky.

Their final agony has caused all sorts of howls, one of which is that copyright law ought to be rewritten. The villain here is the Dreaded Aggregator, those outfits that make money publishing or searching links to content produced by others.

Links, as in hypertext, is a large part of what makes the internet. It guides readers to content. Money is what newspapers used to make when they had the exclusive on selling ads around their content. No longer.

Now Aggregators sell ads around links to newspaper content and other stories. They usually sell those ads for lots less than newspapers, and they can tell advertisers exactly who got the full ad pitch, when, and whether it resulted in a sale. Placing online ads is often much easier than placing a newspaper ad. And the online audience is defined more by a community of interest than a geography-tied circulation list. Those online advantages – cost, reach, metrics and convenience – have been snatching revenue from traditional newspapers.

The newspaper industry’s posture has been head down in the paper dust mumbling “copyright violation” while the industry’s upthrust rear sports a Kick Me! banner. Aggregators have been happy to oblige, noting that they’re not republishing the stories – a violation of copyright – just pointing to where those stories are lawfully published.

That makes newspaper types suggest that the solution isn’t to figure out how to beat the aggregators at their own game in the future, the solution is to re-create the past. And the past they’re trying to regain never was, but that’s a fact, and newspapers aren’t about to let a fact get in the way of a good revenue story.

The story the newspapers want to tell is that in the past, they developed their audience through their outstanding content that brought loyal readers flocking to become the audience that they sold to advertisers. So if they get Congress to change the copyright laws and prevent anyone from linking to their content for a period of time without paying them, their problem will be solved. Readers will stay for the content, advertisers will stay for the readers, and all will be as it was in the days of yore.

Ahh, those days of yore – when the Newspaper Baron was lord of the only game in town and the readers were bound to the paper and advertisers respectfully paid their tribute. You know, kind of like serfs being bound to the land and tradesmen paying for a spot in the Baron’s market. Or forcing even the serfs who grew their own content to grind it in the Baron’s mill.

Newspapers are fond of saying they write the first rough draft of history. Instead, they ought to read a little of it, especially the success of the feudal barons and other nobility who tried to get liberated serfs rebound to the land and the manor. Or the success of the nobility that passed laws to prevent them from leaving in the first place.

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Here’s a link to Cleveland Plain Dealer columnist Connie Schultz calling for a change in copyright: http://www.cleveland.com/schultz/index.ssf/2009/06/tighter_copyright_law_could_sa.html

Here’s a different view from John Temple, former president, editor and publisher of Denver’s The Rocky Mountain News, which died in February: http://www.johntemple.net/2009/06/before-journalists-go-too-far-in.html

And here’s a thoughtful discussion with lots of links by Jeff Bercovici in the Daily Finance at: http://www.dailyfinance.com/2009/06/30/mixed-media-changing-copyright-law-wont-save-newspapers/

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Tuesday, June 30, 2009

Bernie Wins His Last One

Many in old age fear the uncertainty it brings, but at 71, Bernie Madoff has that licked – with a 150-year federal sentence for running the biggest known one-man Ponzi scheme in American investment history, he’s certain of medical care, enough to eat, clothing, and shelter for the rest of his life.

Astute as always, Bernie is buying that sentence at far less than face value since the actuarial buzzards have him on the menu in roughly 13 years. Although he founded his firm in 1960, he’s been quoted as saying it went Ponzi in 1991, so the trade is more than 18 years of fabulous wealth, fame, social standing and respect for him and his family against around 13 years of old age in prison. Buy low, sell high.

And yes, there may be others coming under a judge’s gavel, as authorities wonder how those close to him could have not known or suspected the scam. And his wife, Ruth is reportedly feeling “betrayed and confused” while courts strip her assets down to a paltry $2.5 million, but even if that amount is barely more than the value of their boat, it still isn’t bad.

If he were a betting man, Bernie could bet that few of those prosecuting, convicting and supervising him have wives with $2.5 million in assets. But Bernie’s not a betting man, because he didn’t invest funds from his clients in the market – always a sort of casino – he invested them in himself, which was and remains a sure thing.

Of course, Bernie’s being a non-betting type can really be seen as just nothing more than a service-oriented businessman catering to the needs of clients who wanted to out-perform the market, clients who wanted a sure thing.

And so Bernie gave them a sure thing. Years of double-digit returns, no matter what the market at large was doing, only reinforced the notion that while the rubes were picking stocks on the advice of their horoscopes and in-laws, an astute and select few were able to profit from Bernie’s extraordinary wisdom.

And it was a select few. Not just anyone could enter Bernie’s World of Magical Returns. You had to be invited and recommended, kind of like the country clubs where it never occurs to those who play golf badly for $50,000 in membership fees that they could play it just as badly on a public course for $50.

Of course, some of those playing with Bernie were doing it with money from others who never really had the backgrounds to doubt the returns on official-looking computer-printed account statements. Even the Securities Exchange Commission, which was supposed to have the background, ignored years of repeated complaints.

And although losses in the high billions of dollars were shouted about when Madoff was arrested, untangling actual money invested and lost from the snarl of imaginary profits reinvested in imaginary securities for imaginary returns makes any figures uncertain for some time to come.

Just this remains certain. The only one who probably actually made money here since 1991 was Bernie Madoff – and he didn’t do it in the market.

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Monday, June 29, 2009

For Irritation, Press @!#!

Telephone machines are getting entirely out of hand, and they don’t even have any.

Much loved by the business-school types that can proudly point to the cost savings of replacing telephone call center humans with machines, the widgets now handle both incoming and outgoing calls that demand answers.

Our health plan’s machine calls regularly demanding that the person who answers the phone answer “yes” or “no” when asked if they are my wife. It may be looking for a date, but I suspect it’s trying to get us to switch our meds from the local pharmacy to some mail-order scheme that gives the health plan a bigger cut.

It’s only a suspicion, of course. The widget on the other end stubbornly refuses to listen to anything except the questions it has asked and demands answers like a TV defense lawyer on cross examination.

Machine politics has also taken on new meaning with robo calls from politicians seeking to be elected, re-elected or just to confirm that they actually did hike the Appalachian trail. Oddly enough, the pols that wrote the Do Not Call law forgot to include calls from themselves, or in this case, their machines.

Polling firms are right behind the politicians in machines that politely ask for a few minutes of your time and are unruffled when you suggest an input port for survey shoving.

It gets worse when you are calling some tech company because the service or gizmo they provide isn’t working. Their repair-service usually isn’t either. All phones in the house lost dial tone this afternoon, so the phone company’s repair service was dialed from a cell phone.

In order, the widget that answered had to be convinced that I spoke English and that although it was being called from my mobile number, the problem was main home number. Then the machine spent some minutes testing and assured me that everything was fine. And it was –on the mobile phone. The regular phones were still DOA but the machine had disconnected. The next attempt followed the same multiple minutes of frustration but this time convinced the machine that perhaps a human ought to be involved. It must have had second thoughts, because the human conversation was then disconnected.

A third attempt to connect with a human was successful, with the problem identified and resolved. Total time slugging it out with the machines, thirty minutes. Time fixing it with the human, about two.

They’ll probably fire that human tomorrow.

He’ll get the call from a machine.

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