Thursday, August 05, 2004
Flipping through the Big Five portfolio, we come to Viacom, which New York magazine's journalist/investor James J. Cramer calls a slow-moving, easy-to-sink battleship at the mercy of nimbler competitors who have invested more wisely in video games, satellite radio, Internet search engines, and video-on-demand.
"Those are the companies with the better models, the better technology that has, in an incredibly short period of time, stolen massive amounts of the fuel that powered Battleship Viacom: the viewers themselves," Cramer writes.
I just love the idea of a guy who is repeatedly updating his book about the coming media apocalypse for two decades, against a backdrop of rapid technological change, contrary evidence cascading down about him from the heavens.
While you're at it, I've always loved this wonderful little spasm of sarcasm from Charles Paul Freund in Reason.
Markets—including media markets—never reach equilibrium, something that their critics have never figured out. Left to themselves, media markets remain in flux, changing with the varying roles the media assign themselves, or are assigned by their users. Of course, there is one way to leech the dynamism out of such markets: regulate them.
I think his points on the loss of quality, the loss of localism, and the loss of democratic debate will be harder to refute than that book reviewed.
I think it's just like banks: Once banks merge and merge, they reach the limits of economies of scale. You end up with something that isn't any better for the consumers, and is even worse. For example, people in poorer areas can't get loans as easily as they could before: localism is just gone because one size fits all solutions are cheaper.
It's just like collusion: what's good for business is sometimes bad for the rest of the economy.
But my question to you is: do you believe the market-based solutions should be used based on principles of freedom, or do you believe they should be used because they produce the best outcome?
you could stand here and say that timewarner will take over the globe, and the next day find out that all the high level execs embezzled and cheated from the company, breaking the whole empire into pieces.