the dilemma of the front page

front-pages

The Newseum, that stunning monument to the investment priorities of the leaders of traditional news media, features on its front facade the front pages of newspapers.

The front page of a print newspaper is commonly considered to be important news: “front-page news.”  But news that’s important to you depends on you. Why take seriously what some group of persons whom you haven’t selected and who know nothing specific about you proclaim is important to you?[*]

Knowing what others are reading is important to you.  But many persons get information from the Internet, which has millions of dynamic front pages.  Looking around your social network on Facebook, looking at most read and most emailed article lists on a content site,  and checking search keyword trends and Twitter trends provides much better information about what relevant others are reading than does looking at articles on the front page of a print publication.

Vanity Fair’s recent double-cover issue featured a cover photo of Michael Jackson and a cover photo of Farrah Fawcett.  The text on both covers is exactly the same, but the text layout and font sizes are re-arranged in accordance with the photo featured. Both versions of this issue were side-by-side in the magazine rack at a supermarket where I shop.  So shoppers could choose the magazine with the cover that they preferred.

But offered in this way, the front cover loses value.  How important can it be that Michael is on the front cover if you choose him to be there? What’s the public significance of Farrah being on the front page of your magazine if Michael is on the front page of the other gal’s mag?

The space of public engagement is no longer a sphere but a huge, messy garden.

*  *  *  *  *

[*] The front pages of different newspapers are not necessarily independent evaluations of what’s important.  Since the early 1990s, the New York Times and the Washington Post have been exchanging front page previews the night before publication. The Washington Times’ front page appears to be designed to contrast with that of the Washington Post.  Having enlarged front pages of newspapers displayed across the facade of the Newseum is a claim to public importance that contasts sharply with the usefulness of services such as Google News.  The newspaper history represented within the Newseum similarly contrasts sharply with objective newspaper history and historically representative newspaper content.

michael-farrah

movie negative cost increased 60x since 1929

Some economic aspects of the U.S. movie business have changed relatively little from 1929 to 2007. The number of feature movie releases in both these years was about 700.  The total number of movie screens was 66% greater in 2007.  That’s less of a change than the 148% increase in U.S. population from 1929 to 2007.   The real value of box office receipts, measured relative to the Consumer Price Index, was about the same in 1929 and 2007.

In contrast, expenditure on making movies (negative cost) increased by an estimated factor about 60 from 1929 to 2007. Because this estimate is based on estimates more likely to err on the high side for average negative cost in 1929 and on the low side for averge negative cost in 2007, this estimate is more likely to be too low than too high.  Movie-making costs for feature films have increased enormously since 1929.[*] To cover their costs, feature films now rely heavily on non-exhibition revenue  such as DVD sales, television network distribution fees, and licensing for ancillary mechandise.

The large increase in feature film costs for studios and traditionally organized movie producers creates economic space for new ways of producing  and distributing movies.

*  *  *  *  *

For the data and calculations discussed above, see the online movie economic trends spreadsheet (also available as an Excel file).  I’m grateful to Wayne Schmidt for making available online historical movie data. Check out some of the amazing projects Wayne has undertaken!

Note:

[*] No good, direct evidence seems to exist for the change in film distributional and promotional costs from 1929 to 2007 . Promotion costs are much larger than distribution costs.  Total advertising spending as a share of GDP was greater in 1929  (2.8%) than in 2007 (2.0%).  Film promotion costs probably did not increase as much as did film negative costs.

BellSouth communication services volumes, rates, and revenues, 1992-2009

A dataset of units sold, rates, and revenues from 1992 to 2009 for BellSouth’s interstate communication services is now available.  BellSouth, now part of the new AT&T, developed as a regional Bell (Telephone) Operating Company (RBOC) serving customers in nine states in the U.S. Southeast.  This dataset has been compiled from price-cap tariff data publicly filed at the U.S. Federal Communications Commission (FCC). It is intended to foster better understanding of communications industry developments, keener appreciation for the realities of economic regulation, and more informed public policy deliberation.

The dataset distinguishes some types of special access and trunking revenue by state.  From tariff filing years 2000 to 2003, the state distribution of revenue for these services shifts away from states that accounted for a larger share of BellSouth’s revenue (Florida and Georgia) and toward states that accounted for smaller shares (Alabama and South Carolina). This shift in the distribution of special access and trunking price-cap revenue is associated with FCC grants of BellSouth petitions to remove services from price cap regulation (pricing flexibility petitions).[*]

The number of BellSouth rates under price cap regulation increased greatly from 1992 to 2009.  The number of filed rates increased from 1,168 in filing year 1992 to 37,059 in 2007, and then fell to 21,223.  The share of non-zero-revenue rate elements declined from 55% in 1992 t0 12% in 2009. The net effect was that the number of filed rates associated with non-zero revenue fell from filing year 2000 to filing year 2009.  The broad pattern is similar to that for Bell Atlantic price-cap rate counts.  Identifying significant rates is important for efficient use of regulatory effort.

Looking at rates by descending order of associated revenue provides one view of economically significant rates.  Comparing the top-100 BellSouth special access and trunking rate elements in filing years 1999 and 2009 indicates considerable service revenue inertia. The leading rate element in 2009 was a DS1 local channel termination.  A DS1 local channel provides 1.5 Mbits/s symmetric service. It generated about $43 million for BellSouth in  demand-year-2008 revenue. That’s a lot of revenue for an old service which, by current standards, provides rather meager bandwidth.

Customer demands for rapid service installation apparently have increased.  In the 1999 filing, $3.2 million in revenue was associated with a rate element specifying a special access service order interval of less than 4 days.  In the 2009 filing, a special access (SPA) service date advancement generated $13 million in revenue. Customers seeking rapid order fulfillment pay millions to get it.

In the 2009 filing, a “Data-Universal” rate element is associated with $35 million in revenue.  This rate element has been included in filings since 1999, but prior to the 2009 filing, negligible revenue was associated with it.  The nature of the “Data-Universal” element isn’t clear.  However, innovation is vitally important to the future of telephone companies.  Generating $35 million in revenue in 2009 for the “Data-universal” rate element may be an indication of BellSouth innovating.

*  *  *  *  *

Here’s the BellSouth rate-detail dataset.

Spreadsheet data discussed above:

Note:

[*] An FCC order adopted on Aug. 5, 1999, set out a procedure (“pricing flexibility” petitions) for removing rate elements from existing price-cap regulation. On Dec. 15, 2000, the FCC’s Common Carrier Bureau granted a BellSouth petition for pricing flexibility.  The order granting that petition apparently isn’t online, but an affirming review of that order, which includes a list of the metropolitican statistical areas (MSAs) to which it applies, is online. Here’s a better formated version of the MSA list.  On Nov. 22, 2002, the Bureau adopted an order granting another BellSouth petition for pricing flexibility.  On May 16,2008, the Bureau granted a third BellSouth petition for pricing flexibility.

advertising innovation in action

Here’s a Hollywood-based analysis of sign spinning:

Some of these spinners are quite good and can be fun to watch. But again, I just wonder how useful it all is. Personally, I think they should set up the sign on a stand and [hire] performers to do stuff in front of the sign.  That or women in bikinis.

That’s dead-end thinking of traditional media.

Another whole world of value lives within persons.  Forget about supply and demand.  Have more fun with what you’re doing.  Create more enjoyment for others.  The business will come.  And if it doesn’t, you haven’t wasted any time.

*  *  *  *  *

Thanks for contributions to the above video:

Music by Sackcloth Fashion, courtesy of BeatPick.com / CC BY-NC-SA 3.0

Creative Commons License
Sign Spinners by Douglas Galbi is licensed under a Creative Commons Attribution-Noncommercial-Share Alike 3.0 United States License.