virtualeconomics

Another missing secondary market

Last week Victoria Coren wrote that she hopped on a train with an advance purchase ticket, got caught and had to buy a new, expensive ticket. So far so unremarkable, that's how train tickets work now and while yes it's sad that a natural monopoly got privatised by pseudo-Thatcherite zealots who didn't understand the basics of Thatcherism, and yes it's a shame that instead of public transport Britain has a semi-regulated non-market that's little more than a license for train companies to steal, there's no real trick to catching the train you bought a ticket for. 

All the news that's useful to print

There was an interest rate announcement today from the Bank of England's Monetary Policy Committee. They voted to keep interest rates at 0.5%.

I know because I read it on Twitter. And -here'd the important bit - that headline is all I had to read.

In most media, interest rate announcements make for an article or a news story. They spin it out, because the format they have available, indeed all they know how to do, requires each story to be just that. A story, with a bit of context and analysis and speculation for what it will mean in the future. So the newspaper journalist will tell us a bit about how Gordon made the MPC politically independent and the TV newsreader will point out what it means for mortgage rates, probably with a talking head (or two, for "balance") discussing whether it's good or bad.

But interest rate announcements are precisely the sort of news where absolutely everything relevant can be conveyed in a sentence.

Bad news for the music business is bad news for everyone

Bad news for the music business is bad news for everyone. Earlier today Charles Arthur identified three bits of bad news for the industry, and I'm going to talk about three more and what it all means for music listeners.

Charles points to Warner Music's poor results, Fred Wilson's weary resort to piracy in the face of the industry's refusal to sell him the album he wanted, and research from Forrester showing music's shift to digital is at best in its early stages.

On top of all that, we also have today's ruling against (now defunct) ACS:Law finding that "if all that is proven is a single download then all that has been lost is one sale...." (more in PC Pro, which has absolutely led on this story); we have the takeover of EMI itself by the bankers at Citigroup; and, in a story now a month old, we have HMV's inability to sell CDs even when the pre-Xmas snowpocalypse brought to a near standstill the postal system on which its online competitors rely. Online, offline, everywhere, changing habits and the shift to digital is hammering the commercial prospects for music.

In the broader historical and technological context the collapse of the music industry's commercial model isn't really a big surprise.

On football and competition

A recent European ruling apparently makes it likely that the football league will be prevented from selling rights on a territory by territory basis - a Portsmouth landlady has been buying the games for less than £1,000 from Greece instead of the £7,000 asked by Sky Sports, and initial opinion from European legal experts is that she is fully entitled to.

Apologists for the billionaires who own the big clubs and the millionaires who play for them will claim that the loss by the clubs of their current three billion odd pounds in territorial TV revenues will adversely affect the quality of football played.

Which is palpable nonsense.

You know what's not cool? Stealing seventy billion dollars

It turns out that, as Egypt continues to fight to kick Mubarak out, that he and his family have somehow stashed $70 billion (that's right, with a "b") in banks across the world.

I'm sure you've noticed over the past ten years that trying to get your bank to give you your own money has become more and more complicated and onerous. "Money laundering" regulations apparently require financial institutions to pester us for utility bills, passports and the answers to immemorable security questions before we can see, let alone withdraw, our own cash.

Well, here's a modest proposal. Mubarak has stolen about $70 billion from a country that is about to kick him out. If these international agreements on money-laundering and identity checks are good for anything at all, can we use them to make sure he gives it back? Or, if not, admit that the whole thing is pointless and stop wasting everyone's time with them?

Eat me

Chocolate bars are shrinking but the prices staying the same? Reminds me of a pet annoyance - snack sizes in train stations. Take - by way of example - Leeds station in Yorkshire. There's two W H Smiths, a Whistle Stop and a Journey's Friend all selling basically the same stuff - papers, magazines, chocolates, crisps and drinks. Every single one of them sells soft drinks only in bottles, never in the smaller cans, and only "grab size" (ie sodding massive) bags of crisps. Same in Kings Cross, same in Euston, same in Newcastle. No matter how many outlets in a UK station nominally "compete" with each other to sell snacks for the journey they somehow all end up selling the largest, most expensive - and incidentally therefore most fattening - size of crisps and drinks to their captive audience. Try to buy a can (not a bottle) of coke in any train station and see. It's almost like it's a conspiracy.

A big society of millionaires?

News that the coalition's Big Society Tsar, Lord Wei, 'is to scale back his hours after discovering that working for free three days a week is incompatible with "having a life"' proves once again that life imitates not so much art as satire. Like The Onion's "fuck everything we're doing five blades" or Daily Mash's once-imaginery TV show "America's fattest bitch", satire finds itself the shortest step behind reality when the man in charge of getting people to give up their time for the Big Society realises he simply hasn't the time.

In fact, the only people who seem able to afford the time to work for the still-nascent Big Society for nothing are those with no need to earn a living - millionaires like Martha Lane Fox and Lord Heseltine. 

Which perhaps suggests an opportunity to kill two birds with one stone.

Good news for journalism: no way is Demand Media really worth more than the New York Times

When Demand Media floated earlier this week it started out at $17 a share, rocketed on first day trading to a high of $24, and even after falling back to trade around $22 last night its market cap of $1.8bn still makes it worth more than the New York Times. It's that "worth more than the New York Times" bit that evidently set journalists' teeth on edge - if the US paper of record is worth less than a five-year-old content farm, what hope for journalism?

It's neither surprising nor informative that journalists almost universally hate Demand Media and want it to fail. People who make a living from writing and take pride in crafting sentences are hardly disinterested observers of a content farm that treats articles like commodities and has driven down the price of an article to $15.

The good news for journalism is that there is no rational basis for believing that Demand Media is worth more than the New York Times. Looking at the numbers behind the IPO, Demand Media's almost $2bn valuation doesn't make an iota of sense. 

Some unlimiteds are more equal than others: Tmobile's "fair use" redefinition continues

Last week Tmobile caused a bit of a stir by announcing that their allegedly "unlimited" mobile Internet browsing would be capped at half a gig. At the time I guessed it was to stop people just sticking their old SIM in a tablet. Today, I discovered that actually it's just a ploy to charge customers to get that cap raised.

When Tmobile first announced the massive drop in bandwidth last week, Techdirt commented

"Basically, this is T-Mobile UK announcing to the world that it doesn't have the bandwidth to actually give people what they want, and it hasn't invested in the necessary upgrades to offer a reasonable service. Or, a simpler way of explaining it, is that this is T-Mobile UK telling users in the UK who actually want to use mobile broadband to find another provider."

"We're not on price comparison websites because..."

You know a good way to spot when an explanation is just an excuse? It keeps changing. 

Direct Line tells us they're not on price comparison websites. Indeed, the company has been boasting of its refusal to compete on price for rather more than a year now.

The reasons an insurance company might not to appear on price comparison websites are, admittedly, more complex than a mere desire not to compete directly on price. There are potentially sound business reasons to want to own the customer relationship. But since those reasons are mostly to do with preventing the price comparison site from selling those customers cheaper insurance from a new advertiser at the end of the year, they aren't an explanation you can tell the customers themselves. So over the course of more than a year we have seen, instead, a series of bizarre excuses.