Feb 022006

Two things I’d like to cover today.

First, the RIAA thing is getting out of hand. They keep coming out with figures about how many billions they’ve lost due to piracy. That’s bullshit. You’re creating a figure based how many sales you DIDN’T get. Hell, I could say that I’ve lost 500 trillion dollars because I haven’t yet obtained all the money in the world. Another point is that basic economics will teach you (wow, that class was useful) that you will get a certain amount of demand for a certain price. Lower the price, demand goes up. Charging 20 bucks for a CD that cost about 50 cents to make (and I’m including overhead n shiz) is now turning out to be too high. It is a fact that the music industry appears to be unable to grasp. How hard is it to understand that if you lower your price you will sell more? Now, from what I can tell (and I’m no economist) the demand for cds is fairly elastic (seeing as how there’s so many alternatives and competitors) so a small change in price will see a large change in quantity exchanged (technically: the price elasticity of quantity demanded is greater than 1). That means that their overall profits might very well go UP because they’re able to sell more.

Another matter I want to address is the recent emergence of the issue of artists getting screwed. Firstly, I think the artists are stupid. If your dream is to drop out of high school, get into some band and then magically hit it big (and you have no idea how you’ll do it), then you’re an idiot. I’m not saying it doesn’t happen or won’t happen, but the odds are stacked highly against you. What I’m trying to say is that you need to have other skills and experiences than just how to make music. If you don’t know how to negotiate, how to read a contract (or at least to hire a lawyer to read it for you) then you deserve to be paid tiny amounts and have most your hard-earned cash go to line some plebian bastard. A situation arose like this during the studio era of filmmaking (1940’s-50’s-ish) where studios would get actors in binding contracts because they were naive. Unfortunately, the actors only got paid if they were used, but they couldn’t work elsewhere. What happened if you didn’t get parts? you had to fend for yourself. Eventually this tyrannical system broke down, and I think that will happen in the music industry. It happens today because artists are naive and believe they are just that–artists. That they are somehow diluting their art if they learn some basic business skills.

I would like to apply my arguement about bad pricing to the theatre chains as well. While the MPAA has been trying to claim (like the RIAA) that they lose money to piracy, it’s hard to say that. They believe that the people who downloaded would have bought otherwise. Not true. Most people who download wouldn’t buy if they couldn’t download. A number of reaons exist for that, first is that the movies suck. I have no idea why the movie industry is crying over low ticket sales, they make much, much, much more money from "secondary" markets such as DVDs, TV and overseas distributions. They’re still getting their cash. It’s the theatres that are in a pinch. They are in a pinch because of a number of reasons (I believe):
1. Their pricing is a little high. Recently some chain (Cineplex Odean, I think) reduced their ticket prices a coupla dollars. I’d be interested in seeing some numbers on how that worked out.
2. The "experience" of the a theatre is now being mimicked at homes with greater and greater ease. With the growing popularity of high-def and surround sound, it’s easier to feel like you’re at the movies at home. Times used to be that the only way you could hear the symphony was by going to a concert hall. That’s not the case anymore. You have many more choices now, but concert halls still exist.
3. Crappy movies. Self-explanatory. Audiences are becoming more sophisticated. They liked the mind-bendiness of The Matrix (my opinion on the matter doesn’t really…matter). They liked the narrrational tricks of Memento. Audiences want to be stimulated. They want to think about a movie after it’s over. Throwing in some action, some chics and some plot doesn’t make a good movie, regardless of how much money you throw at it. I believe that one of the fundamental conventions of the Hollywood system might have to be changed–that that a movie must be easy to understand. On another level, the movies need to become more realistic. I mean, most of us don’t lead lives like those portrayed in the movies (part of the popularity of movies is because they lead different, sometimes "better" lives than us). But when they do try to portray real life in movies, it seems to get too stylized to be convincing. This last arguement is a little thin, I will think on it later.
4. No genre of our times. Hollywood has been unable to find a solid formula for the current times. A solid formula for a movie becomes a genre over time. Film 101. Westerns captured the imagination of the audiences in 40’s, 50’s because they dealt with an ideological fight between wilderness and civilization. Hollywood needs to find some sort of movie formula that both connects with the audience and is entertaining. Hollywood will stop complaining about not making as much money once they work out something that works. The more profitible films of recent times have included comic book adaptations, book adapatations and fantasy movies. Perhaps it is the fact that we can not do them with previously unprecedented realism, but they’ve been popular. I’ll have to look up the figures and properly work this reason out.

There you have it, my extremely long rant on stupid shit.

In other news, I’m going to be doing presentations to teach other UfT clubs and high school students about investing.

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