A famous Oatmeal cartoon showed the cartoonist making a good faith effort to buy Game of Thrones. He finds that the show is not available on iTunes, Netflix, Amazon, or Hulu. He tries to buy HBO Go, but it's only available as an add-on to a cable package. Finally, the cartoonist gives up trying to pay for the show and pirates it through Bit Torrent. This cartoon is probably the best ever expression of the "piracy is a customer service issue" thesis.
In a way, this doesn't make any sense for HBO, which makes its money off subscriptions and would ostensibly welcome an opportunity to sell subscriptions to another market segment. HBO claims that (a) people aren't interested in a la carte HBO Go and (b) the transaction costs are too high to do their own billing, etc. The technical term for these explanations is "bullshit." Cord cutters are a relatively small market segment but a fast growing one and I think it unlikely that cable subscriptions will fully rebound when the recession ends since the issue isn't just price but convenience. Moreover, I see no reason why HBO can't handle billing and other logistical issues when the Metropolitan Opera and the NFL, not to mention Netflix, don't seem to have any trouble running their own separately billed streaming video services. Of course there are transaction costs associated with billing, but it can't possibly be anywhere close to the cost of a basic cable package.
And here we get to the real issue. It's not that HBO would like to cut out the middleman and sell to us directly, rather requiring you to buy basic cable is the whole point. Cable is a total cash cow and a more flexible business model means lower revenues. The reason is that the incumbent business model of cable combines the features of bundling (basic cable) and a two-part tariff (premium cable channels) for a perfect storm of price discrimination. For much the same reason as Disneyland could only lose money if it sold a la carte tickets to Splash Mountain for $20 without requiring $80 park admission (which includes access to Main Street, Jungle Cruise, etc), cable companies would lose money if you could buy HBO Go for $20 without first buying basic cable (which includes access to ESPN, Mtv, etc). Basically, economic theory (and some reasonable assumptions about the structure of demand) suggests that an a la carte video market could not make as much money as a bundled video market.
So, that's why the cable companies don't want you to buy a la carte HBO Go, but why is that HBO's problem? Let's contrast it with the NFL. The NFL offers standalone access because the credible threat of a streaming business model gives them more leverage to negotiate with the MSOs. In contrast, HBO doesn't want leverage because most of its sister companies are part of the basic cable ecosystem. (They used to have an actual MSO as a sister company but they spun off Time Warner Cable in 2009). Time Warner makes a lot of money from HBO subscriptions, but it makes even more money from carriage fees on CNN, Cartoon Network, and most of the cable networks starting with the letter "T." Unlike HBO (which would do well under an a la carte model) most of these other channels rely more on channel-surfing audiences than cult followings and so couldn't sell subscriptions on their own and would have to settle for something like a Hulu Plus or Netflix business model, probably with less money per subscriber and far fewer subscribers than they currently get through basic cable. Basically, cord-cutting would help HBO but devastate the rest of the company. For what is a media conglomerate profited if it gain a few hundred thousand a la carte HBO Go subscriptions, and lose its carriage fees and ad revenue? What can a media conglomerate give in exchange for its Turner and WBTVG divisions?
Time Warner more or less acknowledges in their investor report that disruptive innovation could screw them: "Furthermore, advances in technology or changes in competitors' product and service offerings may require the Company to make additional research and development expenditures or offer products or services in a digital format without charge or at a lower price than offered in other formats." This is on the first page of the "risk factors" section of the report, whereas piracy doesn't come up until the third. This order is consistent with my own reading of the industry and with the history of the recorded music industry, the proximate problem of which is not piracy but digital singles.
So basically, we can call this the "HBO has to take one for the team" model. We can get a similar result with a slightly weaker model which doesn't require long-term corporate cross-subsidization but treats HBO as autonomous from the rest of Time Warner. In the short-term, HBO itself is highly dependent on cable companies. The target market for a la carte HBO Go would be households with broadband but no cable, or about 5% of all US households. This is dwarfed by the 20% of households that have cable but no broadband. Moreover, although 70% of households have both cable and broadband, most of them aren't familiar with streaming video through set-top devices. So as a rough ballpark, let's say that half of US households have cable but either lack broadband and or wouldn't know how to use it with a set-top device (even if they already own a Blu-Ray player or game console with built-in streaming support). This means that the number of households HBO could appeal to with a la carte HBO Go are one tenth as numerous as the households they rely on cable companies to reach. And HBO does rely on the cable companies to reach these households through marketing promotions and the like. If HBO figures that angering the cable companies could cost them even a small fraction of these households then they're better off alienating Matthew Inman and myself rather than angering Comcast. The same logic explains why Netflix is interested in creating a cable channel and recent rumors that Hulu will switch to the HBO Go business model.
Of course for the cable companies to punish HBO would require them to forgo their half of HBO subscription revenue. This sounds like cutting off your nose to spite your face but that's not unheard of, especially if doing so deters your face from pissing you off again by flirting with a disruptive business model. We see a similar dynamic with how theatrical exhibitors react whenever movie studios suggest closing the video release window from its current 17 weeks. (Ironically in this scenario it's the cable companies who are the innovators trying to disrupt the stodgy incumbents). For instance last year, Universal floated the idea of experimenting with tightening up the pay-per-view window for Tower Heist. The theaters were livid and threatened to boycott the test film. This despite the fact that the experiment was on ridiculously unappealing terms to the consumer: $60 to watch a mediocre film three weeks after theatrical premiere and that's only if you live in Atlanta or Portland. Ultimately Universal backed down, deciding it was better to keep their old trading partners happy than try to develop new ones.
(By the way, I'm sure you'll agree it's a total coincidence that Universal was bought by a cable company shortly before the Tower Heist incident. Similarly, a total coincidence that this same cable company has a history of playing hardball with internet companies that offer infrastructure for streaming video services that compete with cable TV).
All that is to say I can understand why HBO Go isn't available yet to cord cutters. Still, let's say that tomorrow HBO starts offering standalone HBO Go subscriptions (as I sincerely hope it does), how would I explain that? I could see this happening if HBO decides that the transition will happen eventually and it is better to do it while they can still do so favorably. We saw a similar dynamic ten years ago with the recorded music industry, which acceded to a low price point digital singles market as it saw its market share eroded by piracy, but only moderately so. In 2003, when the record labels agreed to participate in iTunes, unit sales were down about 15% from the pre-Napster peak, which wasn't fun but also wasn't catastrophic. Most people were still buying CDs when the record labels agreed to a legal digital singles market that would eventually destroy the CD market. They did so in order to transition consumers to a new model before most of us had fully committed to piracy. It's a lot easier to get someone to buy singles for $1 if they're used to buying CDs for $15 than if they're used to pirating singles for nothing. Similarly, as the number of cord-cutters increases this will be an increasingly attractive market for HBO, and not just because it can get these people as customers but because it can keep them from developing the habit of pirating content that isn't promptly made available through legitimate streaming markets. We may not be at that point yet, but I wouldn't be surprised if we reach it before HBO runs out of Fire and Ice novels to adapt.
Though it wasn’t pretty, Minaj was really teaching a lesson in civility.
Nicki Minaj didn’t, in the end, say much to Miley Cyrus at all. If you only read the comments that lit up the Internet at last night’s MTV Video Music Awards, you might think she was kidding, or got cut off, when she “called out” the former Disney star who was hosting: “And now, back to this bitch that had a lot to say about me the other day in the press. Miley, what’s good?”
To summarize: When Minaj’s “Anaconda” won the award for Best Hip-Hop Video, she took to the stage in a slow shuffle, shook her booty with presenter Rebel Wilson, and then gave an acceptance speech in which she switched vocal personas as amusingly as she does in her best raps—street-preacher-like when telling women “don’t you be out here depending on these little snotty-nosed boys”; sweetness and light when thanking her fans and pastor. Then a wave of nausea seemed to come over her, and she turned her gaze toward Cyrus. To me, the look on her face, not the words that she said, was the news of the night:
In the name of emotional well-being, college students are increasingly demanding protection from words and ideas they don’t like. Here’s why that’s disastrous for education—and mental health.
Something strange is happening at America’s colleges and universities. A movement is arising, undirected and driven largely by students, to scrub campuses clean of words, ideas, and subjects that might cause discomfort or give offense. Last December, Jeannie Suk wrote in an online article for The New Yorker about law students asking her fellow professors at Harvard not to teach rape law—or, in one case, even use the word violate (as in “that violates the law”) lest it cause students distress. In February, Laura Kipnis, a professor at Northwestern University, wrote an essay in The Chronicle of Higher Education describing a new campus politics of sexual paranoia—and was then subjected to a long investigation after students who were offended by the article and by a tweet she’d sent filed Title IX complaints against her. In June, a professor protecting himself with a pseudonym wrote an essay for Vox describing how gingerly he now has to teach. “I’m a Liberal Professor, and My Liberal Students Terrify Me,” the headline said. A number of popular comedians, including Chris Rock, have stopped performing on college campuses (see Caitlin Flanagan’s article in this month’s issue). Jerry Seinfeld and Bill Maher have publicly condemned the oversensitivity of college students, saying too many of them can’t take a joke.
After calling his intellectual opponents treasonous, and allegedly exaggerating his credentials, a controversial law professor resigns from the United States Military Academy.
On Monday, West Point law professor William C. Bradford resigned after The Guardianreported that he had allegedly inflated his academic credentials. Bradford made headlines last week, when the editors of the National Security Law Journaldenounced a controversial article by him in their own summer issue:
As the incoming Editorial Board, we want to address concerns regarding Mr. Bradford’s contention that some scholars in legal academia could be considered as constituting a fifth column in the war against terror; his interpretation is that those scholars could be targeted as unlawful combatants. The substance of Mr. Bradford’s article cannot fairly be considered apart from the egregious breach of professional decorum that it exhibits. We cannot “unpublish” it, of course, but we can and do acknowledge that the article was not presentable for publication when we published it, and that we therefore repudiate it with sincere apologies to our readers.
Accusations of terrorism are a window into how the Turkish government tries to intimidate reporters, but also how a media bad boy is maturing.
Under Recep Tayyip Erdogan’s presidency, Turkish journalists have increasingly been badgered, intimidated, threatened, and punished. Now, however, the Turkish government is going after two foreign journalists.
It’s not difficult to see why the Turkish government might not want journalists in the area. Kurdish fighters, some backed by the U.S., have been battling ISIS in Iraq for months. While Turkey opposes ISIS, it’s also terrified of emboldened Kurds pushing for an autonomous state in the region. For decades, Ankara has fought a protracted war against Kurdish guerrilla groups in southeastern Turkey. After long trying to avoid being drawn into the conflict against ISIS, Turkey, a U.S. ally, has begun to take action, but it’s fighting against both ISIS and the Kurds, a strange case where, for the Turkish government, the enemy of my enemy might still be my enemy.
The use of a stick to hold a camera at a distance for a self-portrait is not a new phenomenon, but the popularity of the new breed of extendable selfie stick has exploded over the past two years.
The use of a stick to hold a camera at a distance for a self-portrait is not a new phenomenon, but the popularity of the new breed of extendable selfie stick has exploded over the past two years. Multiple companies are producing varied versions of the device, tailored mostly to smartphone users. These sometimes-unwieldy extenders have been labeled as nuisances by some, especially in crowded public spaces, and have been banned in many museums, stadiums, and theme parks. Collected here are recent images of selfie sticks in use around the world, from high in the sky above China to the shores of Greece and beyond.
Thicker ink, fewer smudges, and more strained hands: an Object Lesson
Recently, Bic launched acampaign to “save handwriting.” Named “Fight for Your Write,” it includes a pledge to “encourage the act of handwriting” in the pledge-taker’s home and community, and emphasizes putting more of the company’s ballpoints into classrooms.
As a teacher, I couldn’t help but wonder how anyone could think there’s a shortage. I find ballpoint pens all over the place: on classroom floors, behind desks. Dozens of castaways collect in cups on every teacher’s desk. They’re so ubiquitous that the word “ballpoint” is rarely used; they’re just “pens.” But despite its popularity, the ballpoint pen is relatively new in the history of handwriting, and its influence on popular handwriting is more complicated than the Bic campaign would imply.
The neurologist leaves behind a body of work that reveals a lifetime of asking difficult questions with empathy.
Oliver Sacks always seemed propelled by joyful curiosity. The neurologist’s writing is infused with this quality—equal parts buoyancy and diligence, the exuberant asking of difficult questions.
More specifically, Sacks had a fascination with ways of seeing and hearing and thinking. Which is another way of exploring experiences of living. He focused on modes of perception that are delightful not only because they are subjective, but precisely because they are very often faulty.
To say Sacks had a gift for this method of exploration is an understatement. He was a master at connecting curiosity to observation, and observation to emotion. Sacks died on Sunday after receiving a terminal cancer diagnosis earlier this year. He was 82.
Many educators are introducing meditation into the classroom as a means of improving kids’ attention and emotional regulation.
A five-minute walk from the rickety, raised track that carries the 5 train through the Bronx, the English teacher Argos Gonzalez balanced a rounded metal bowl on an outstretched palm. His class—a mix of black and Hispanic students in their late teens, most of whom live in one of the poorest districts in New York City—by now were used to the sight of this unusual object: a Tibetan meditation bell.
“Today we’re going to talk about mindfulness of emotion,” Gonzalez said with a hint of a Venezuelan accent. “You guys remember what mindfulness is?” Met with quiet stares, Gonzalez gestured to one of the posters pasted at the back of the classroom, where the students a few weeks earlier had brainstormed terms describing the meaning of “mindfulness.” There were some tentative mumblings: “being focused,” “being aware of our surroundings.”
The Islamic State is no mere collection of psychopaths. It is a religious group with carefully considered beliefs, among them that it is a key agent of the coming apocalypse. Here’s what that means for its strategy—and for how to stop it.
What is the Islamic State?
Where did it come from, and what are its intentions? The simplicity of these questions can be deceiving, and few Western leaders seem to know the answers. In December, The New York Times published confidential comments by Major General Michael K. Nagata, the Special Operations commander for the United States in the Middle East, admitting that he had hardly begun figuring out the Islamic State’s appeal. “We have not defeated the idea,” he said. “We do not even understand the idea.” In the past year, President Obama has referred to the Islamic State, variously, as “not Islamic” and as al-Qaeda’s “jayvee team,” statements that reflected confusion about the group, and may have contributed to significant strategic errors.
Can the sleek F-35 match the rugged dependability of the aging A-10? The Pentagon plans to find out.
If you’re the Pentagon, how do you choose between an aging, but dependable, fighter jet and a brand new aircraft that you’re not quite sure is up to the job? You have them fight it out, naturally.
That’s essentially what the Air Force said it would do when it announced that starting in 2018, it would pit the A-10 “Warthog” against the F-35 Joint Strike Fighter in a series of tests to see if the new F-35s can adequately replace the A-10s, which the military wants to retire. A 40-year-old platform, the A-10 has been described by Martin Dempsey, the joint chiefs chairman, as “the ugliest, most beautiful aircraft on the planet.” It may be old, but as a certain Irish actor would say, it has a very particular set of skills: The A-10 excels at providing what’s known as “close-air support,” flying low and slow to provide ideal cover protection for U.S. troops fighting in ground combat. That capability is prized not only by the military, but also by a pair of key Republican lawmakers who oversee its budget, Senators John McCain and Kelly Ayotte.