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Musings Report 2018-29 7-21-18 Doubts about the New Model of Paying for Content: Popularity
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For those who are new to the Musings reports: they are basically a glimpse into my notebook, the unfiltered swamp where I organize future themes, sort through the dozens of stories and links submitted by readers, refine my own research and start connecting dots which appear later in the blog or in my books. As always, I hope the Musings spark new appraisals and insights. Thank you for supporting the site and for inviting me into your circle of correspondents.
Doubts about the New Model of Paying for Content: Popularity
You are receiving this essay because you are a financial supporter of my work, via a subscription, contribution or Patreon patronage.
Needless to say, you know all about the economic conundrum facing content creators: how can independent journalists, writers, cartoonists, animators, documentary filmmakers, musicians, podcasters, etc. get compensated for creating content in a world in which content is mostly free?
Unlike the majority of consumers of content, you've chosen to support creators of content directly via subscriptions or patronage.
To me, you are the Heroes and Heroines of Independent Media, for without direct financial support, Alternative / Independent Media rests on a very flimsy platform based on popularity--in essence, a monetized system of "likes."
But before we get to that new model, let's cover the conventional models.
1. Direct patronage was the model of supporting artists, composers, writers, etc. for much of Western history, hence the great number of portraits of wealthy patrons and compositions dedicated to wealthy patrons.
2. The other model for independent creators was to work a full-time job and write, compose or paint in whatever spare time remained. This is the model for Goethe (manager of a large estate as a livelihood), Descartes (tutor to nobility), Mahler (working conductor and musical director), Philip Glass (plumber and taxi driver) and countless others.
3. The conventional model in the industrial / post-industrial age is to secure a position in an institution that provides financial support in exchange for things the institution values: labor, loyalty, reputation, research, etc.
These institutions include universities, think-tanks, foundations and to a lesser degree, Old Media. The vast majority of mainstream authors, composers, artists, etc. depend on a position in an institution (or institutional funding) for their livelihood.
4. The last conventional model is the marketplace: selling one's creative content successfully enough to generate a living, or in a few cases, wealth. If you pore over detailed income data from the IRS (something I consider part of my job), you discover tens of thousands of individuals earn substantial sums from royalties, which typically flow from music, books, films, etc., and licencing of patents and other intellectual property.
The IRS doesn't break out the sources of royalties, but we can surmise the majority flow to owners of patents. Using other data, we can conclude the number of individuals earning middle-class incomes solely from creative content is very modest.
A new model of "income sharing" has arisen in which corporate distributors of content (Spotify, YouTube, etc.) pay the content creators a thin slice of revenues from subscriptions, advertising, etc.
These are notoriously modest. Thousands of listens on Spotify generates less than $20.
Creators need millions of views/listens/downloads to earn meaningful sums: 11 million views on YouTube nets $7,200, according to online data.
Many creators mix and match these funding sources: they apply for grants, market their work, have a part-time job, teach part-time in a school or college, etc.
The new model is Internet-based. I know of two examples: Medium.com, and Steemit, which is "a social media platform where everyone gets paid for creating and curating content."
In both Medium and Steemit, one's income from posting content is based on the popularity of your content (or curation). If very few people read/consume your content, your earnings can be counted in pennies: to really make the equivalent income of a part-time job, your content needs to be viewed/ "liked" / recommended thousands of times.
Given this set of financial incentives, what would you post? Something short (so you can produce numerous posts), something catchy or topical, something that can be reduced to bullet-points/short list, and so on.
Given the dependence of income on "likes," what's the incentive to post content that's challenging and unlikely to be popular in terms of "likes"?
In effect, these models create powerful incentives for short "light reading" / entertainment and powerful disincentives for doing lengthy research, explaining complex dynamics, etc.
If one's work isn't popular (doesn't generate thousands of "likes" in systems that pay for popularity), doesn't sell well on the marketplace and doesn't qualify for institutional "ownership"/sponsorship, then what's left?
The support of independent patrons like you. That's the only model I see that frees content creators to generate work that may not be wildly popular or mainstream enough to win conventional institutional support, but that still has value to a core group of supporters.
I treasure your support because it confirms my work has some value beyond my own hopes. I reckon every other content creator you support feels the same.
Highlights of the Blog This Past Week
The Schizophrenic Deep State is a Symptom, Not the Disease (7/20/18)
Our Institutions Are Failing (7/16/18)
Best Thing That Happened To Me This Week
Forgiveness and understanding from a good friend for a thoughtless faux pas of mine.
Market Musings: Three-Pack: Gold, Bitcoin, Put-Call Ratio
Part of my job is to look at a lot of economic/financial charts every week, and I try not to overburden your patience with too many charts.
Here are three charts that caught my attention: Gold, Bitcoin and the Equities put-call ratio (CPCE), which reflects the confidence (Bulls) and fear (Bears) of options traders.
No indicator of tradable highs or lows is perfect. If any indicator was close to perfect, everyone would start using it and as a result it would lose its predictive value.
Tom McClellan shared this chart of gold on his Twitter feed. The lower panel is a measure of uptrend/downtrend, and it's registered a new low. The last time this indicator was this low, gold rallied over $250.
There's no guarantee it works this time, but extremes are always worth noting. Can they become more extreme? Of course.
The second chart (weekly) is of the NYXBT, the NYSE Bitcoin index, which has been declining since January.
MACD and stochastics are finally looking bullish, and the downtrend has been broken to the upside, at least for now. The descending wedge formation is also a reliably bullish indicator. Is the downtrend in Bitcoin over? If the bullish trend holds, the likelihood increases.
What caught my eye in the CPCE chart are the trendlines. Recall that CPCE is on a see-saw with the S&P 500 (SPX): when the CPCE is very low, stocks are bullish, confidence is high and that often marks a top in stocks. When CPCE spikes higher, it signals fear and a tradable bottom in stocks.
When stocks are skittish and weak, the CPCE notches higher. When stocks are exhibiting bullish strength, CPCE trends down.
Interestingly, CPCE has been trending higher since June 1, suggesting weakness in stocks, yet the SPX continues edging higher, surpassing 2800.
My interpretation of the CPCE is that stocks are not as bullish as price indicates, and a move down is increasingly likely.
From Left Field
How the Enlightenment Ends: Philosophically, intellectually--in every way--human society is unprepared for the rise of artificial intelligence. (Henry A. Kissinger June 2018) -- H.A.K. is 95...
Love and Western Nihilism -- this is heresy...
Donald Trump was Elected by Russia? Mass Dementia in the Western Establishment -- this is also heresy...
Batam Island: Indonesia’s Pathetic Attempt to Create Second Singapore (This time it was really supposed to work!) -- more heresy....
IT’S TIME FOR A LITTLE PERSPECTIVE ON RUSSIA (Current Affairs) -- meddling in elections and internal politics is part and parcel of intelligence/spying....
The staggering rise of India’s super-rich: India’s new billionaires have accumulated more money, more quickly, than plutocrats in almost any country in history.
Nitrates in Meat May Be Tied to Mania -- far from proven, but interesting...
It’s not kids’ screen time you should worry about - it’s yours.
Take a look inside a Japanese home and you’ll understand why they love minimalism (via Bill M.) -- many ads, view with adblocker... actually, urban homes in Japan are often cluttered due to their small size... this article is a good example of idealization....
John Brennan, Melting Down and Covering Up: He accuses Trump of treason. But what's his bluster really about?
The Aesthetics of Gentrification, and New York’s Top-Down Approach to Change-- interesting view of how desirable cities are changing, and not for the better....
The inconvenient truth about cancer and mobile phones--maybe they're safe, but check who's saying so and based on what evidence...
The Man Who Planted Trees (1987) (30 min animation)
"The political and commercial morals of the United States are not merely food for laughter, they are an entire banquet." Mark Twain (via laserLefty)
Thanks for reading--
charles |
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