newspapers and magazines: bigger problems than the Great Depression

U.S. print newspaper and magazine advertising revenue is falling sharply.  In the first quarter of 2009, newspaper print advertising revenue declined 30% compared to the first quarter of 2008 ( $5.92 billion in 2009 Q1; $8.42 billion in 2008 Q1).  Magazine rate-card-reported advertising revenue, which does not take into account discounting likely to be more significant in more difficult economic times, declined 20% ($4.18 billion in 2009 Q1;  $5.25 billion in 2008 Q1).  These declines are associated with the current, major macro-economic contraction.  However, these sharp declines in newspaper and magazine advertising are not just a macro-economic effect.  They also indicate deep structural changes in the communications industry.

The current newspaper and magazine advertising revenue contraction is much more rapid and significant than that associated with the Great Depression.  From 1929 to 1931, newspaper and periodical advertising revenue fell only 23% and 25%, respectively.  The revenue decline subsequently accelerated and amounted to 31% and 42% for newspapers and periodicals, respectively, from 1931 to 1933.  Because periodicals have a higher share of subscriber revenue than newspapers, the more rapid decline in periodical advertising was offset to an extent by periodicals’ greater revenue diversification.  The opposite comparative business model effect operates with the current more rapid decline in newspaper advertising revenue and newspapers’ greater dependence on advertising.

Print media almost surely will remain a significant feature of the public landscape. Now, however, every person can operate an astonishing, virtual multi-media printing press that the Internet provides globally.  How persons use print media undoubtedly will change enormously, and so too will the traditional business of newspapers and magazines.

Note:  Here’s U.S. Census data concerning the revenue structure of U.S. newspapers and periodicals from 1880 to 2007. Available also as an Excel file.

Update: Now includes data through 2008 from the 2008 Services Annual Survey, Tables 3.1.1 and 3.1.2.

communicative calculus in science

The brilliant Michael Nielsen observes:

The contrast between the science comment sites and the success of the amazon.com reviews is stark. To pick just one example, you’ll find approximately 1500 reviews of Pokemon products at amazon.com, more than the total number of reviews on all the scientific comment sites I described above. The disincentives facing scientists have led to a ludicrous situation where popular culture is open enough that people feel comfortable writing Pokemon reviews, yet scientific culture is so closed that people will not publicly share their opinions of scientific papers. Some people find this contrast curious or amusing; I believe it signifies something seriously amiss with science, something we need to understand and change.

Science, like some types of blogging, occurs within a field of intense status competition.  Leaving reviews on Amazon doesn’t.  That’s a key explanation for the much different human behavior in commenting on scientific papers and leaving reviews on Amazon.

Can intense competition for (social/group) status occur without persons carefully regulating with whom they communicate and what they write?  Communication and sociality evolved together, hence at least some aspect of communication and sociality are likely to be difficult to change independently.  Wikipedia limits individual status competition by pushing into the background the names of contributors.  At the same time, among active Wikipedia contributors who become socially engaged with each other, all the usual types of human communicative behavior undoubtedly occur. In evolved human psychology, males are likely to be more behaviorally oriented toward status competition, while females are likely to be more skilled in social communication. In science, which imperfectly encompasses female and male scientists,  quite complex and obscure patterns of communication can easily occur.

Changing assets in scientific status competition can lead to more public goods.  Nielsen insightfully describes how this  occurred with the development of scientific societies and scientific (public) journals. Open source software projects invest contributors in the success of a common, public symbolic work.  I have no doubt that new communication technology can help science operate in a way much more beneficial to the public than science currently does.

low bandwidth but geographically comprehensive connectivity has high value

Verizon introduced its National Discount Plan (NDP) on June 14, 2007. This “new, industry-leading, generally available plan for DS1 and DS3 Special Access services” offered terms that depended on a customer’s national volume of DS1s and DS3s purchased from Verizon.  Publicly available FCC annual access tariff filings suggests that Verizon sold under the NDP about $100 million of services in 2008.[1]

Rate element revenue under the NDP suggests the high value of relatively low-bandwidth, geographically comprehensive connectivity. Within Verizon’s historic Bell Atlantic service area, services associated with DS1s account for 89% of NDP revenue, while services associated with DS3s account for only the remaining 11%.  Among all interstate special access DS1 and DS3 service revenues, DS1s have a 59% share.  The national comprehensiveness of the NDP shifts Verizon connectivity revenue weight toward lower-bandwidth connectivity (DS1s).

The NDP revenue distribution across zones suggests the importance of geographically comprehensive connectivity.  NDP rate elements specify three zones.  NDP customers averaged 10 DS1 channel terminations per inter-office link in zone 1, 7  per inter-office link in zone 2, and 2 in zone 3.  Average DS1 interoffice mileage was 10 miles in zone 1, 14 miles in zone 2 , and 19 miles in zone 3.  Similar over-all patterns exist for NDP customers’ DS3 units.[2] The progression from zone 1 to zone 3 thus indicates more geographically dispersed network traffic sources.

The majority of NDP revenue is from zone 3 services.  Zones 1, 2, and 3 account for 20%, 21%, and 58% of NDP revenue, respectively.  For all Verizon offerings of DS1 and DS3 services in the historic Bell Atlantic region, zones 1, 2, and 3 account for 37%, 21%, and 42% of revenue, respectively. Hence zone 3, the zone with the most dispersed telecom traffic sources (relatively rural areas), generates a relatively large amount of revenue.  That’s even more true for customers who purchase services under the NDP.

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NDP rate elements with positive demand for Verizon’s historic Bell Atlantic and Nynex service regions, as well as NDP revenue summaries for the historic Bell Atlantic region, are available as a webpage and an Excel spreadsheet.

Notes:

[1] The quoted phrase is from a publicly available Verizon document describing the NDP.  Here’s the press release announcing the NDP. See also some analysis of the NDP in relation to telecom service innovation.  Verizon NDP revenue in the historic Bell Atlantic service area in 2008 was $52 million, and in the historic Nynex region (New York and New England), $34 million.  The relative size of Verizon’s local telephone companies elsewhere, especially California and Florida, suggests a total of about $100 million in NDP revenue.

[2] Compared to DS1s, DS3 channel termination concentration is much lower.  DS3 average inter-office mileage is also greater.  These facts are consistent with greater investment in point-to-point traffic management of more expensive DS3 service.

ancient Greek inscriptions: some early content economics

Poets in ancient Greece were like opinion columnists in leading newspapers of the late twentieth century. The great epic poet Homer was the common teacher of praiseworthy behavior.  Epic poetry defined heroism, and the epic poet gave public prestige and dignity to events he deemed worthy for poetry.  To compose epic poetry required literacy, intensive study of past events and authorities, and mastery of dactylic hexameter couplets.  Few persons could plausibly aspire to write words that could measure up to a heroic standard:

Though deep, yet clear; though gentle, yet not dull;
Strong without rage, without o’erflowing full.[1]

Tragic and comic poetry were the featured form of speech at important civic festivals,  the City (Great) Dionysia and the Lenaea.  The most widely admired public teachers were poets.

However, in the common business of inscribing dedicatory, funerary, administrative, and honorific monuments, few paid the price of a poet’s services.  Of surviving inscriptions at the leading pan-Hellenic shrine at Delphi from the sixth century BGC through the third century GC, only about 1% of inscriptions are in verse.  In Athens, the share of verse inscriptions seems to have fallen with the development of democracy and Greek culture.  Surviving inscriptions up through the sixth century BGC are about 25% verse; from the fifth century BGC, about 8% verse; and from the fourth century BGC, about 4% verse. Moreover, verse inscriptions typically were not attributed to a poet, and the poets who composed verse epigrams were not well known.[2] A leading scholar of Hellenistic epigrams observed:

Throughout the genre’s history, moreover, many patrons did not trouble to hire professionals to compose their epigrams; they just did it themselves.  …

A striking example of poor yet plentiful, epigraphic verse, from the mid-third century B.C., is the series of poems inscribed at the sanctuary of Artemidorus of Perge on Thera.  It is hard to imagine that Artemidorus paid a professional to compose these.  If he did, he was badly swindled.[3]

Physical monuments are relatively expensive to construct.  Words inscribed in stone endure for a long time.  Most stone monuments in ancient Greece did not have great public importance.  The market-driving attribute of the words inscribed on most stone monuments was that the words satisfied well the patron’s interest. Words that the patron himself or herself wrote, or words that said in prose exactly what the patron wanted to be said, could do this better than could professional poetry.

Beginning at the end of the fourth century, verse epigrams became a focus of elite literary art.  One scholar has speculated:

What perhaps happened in the fourth century [BGC] was that inscriptional epigrams were collected for circulation as reading material for pleasure, as opposed to earlier professional use by stone-cutters.[4]

Epigram writers studied carefully the tradition of inscribed verse epigrams and artistically varied generic conventions.  Lucillius, a poet from the first century GC, mocked with a pseudo-funerary epigram what had become poets’ zeal for writing epigrams:

Although nobody has died here, wanderer,
Marcus the poet has constructed a tomb,
composed the following monostichic epigram and had it engraved:
“Cry for Maximus from Ephesus, twelve years old…”[5]

Part of the humor here is that, when writing epigrams became a literary art, funerary epigrams were written for persons who were still alive, like one might expect Maximus from Ephesus to be at twelve years old.

Collecting epigrams also became a highly valued literary activity. The Milan Papyrus has preserved a collection of verse epigrams, attributed to Posidippus, from the late third or early second century BGC.  About 40 BGC, Meleager of Gadara produced a famous collection of epigrams that he called a garland.  He thus analogized his collection of epigrams to interwoven, small, beautiful flowers.  Collecting epigrams remained an elite literary passion through to the Middle Ages.  A collection known as the Greek Anthology has been preserved in medieval manuscripts.  It represents about a thousand years of continuing elite literary work both in composing epigrams and in organizing and preserving epigrams from the past.

User-generated content and professional content have different values.  User-generated content best serves highly personal preferences.  Professional content is part of elite status competition and succeeds more broadly for socially structured pleasures.

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Read more:

Notes:

[1] From John Denham, “Cooper’s Hill.”

[2] See Peter Bing and Jon Steffen Bruss, “Introduction.” 2007.  Brill’s companion to Hellenistic epigram.  Brill’s companions in classical studies. Leiden: Brill, pp. 2-4.

[3] Id. p. 4, and p. 4, ft. 19. I’ve omitted an internal reference.

[4] Id. p. 7, ft. 26, quoting email from J. Lougovaya.

[5] Quoted and translated in Doris Myer, “The Act of Reading and the Act of Writing in Hellenistic Epigram.” 2007.  Brill’s companion to Hellenistic epigram.  Brill’s companions in classical studies. Leiden: Brill, p. 198.  Id. ft. 40 makes the point about the common practice in Lucillius’ time of funerary epigrams preceding the death of the subject.