On Content, Promotions, Basic Economics... And Loutish Statements
from the content-and-advertising dept
"Recorded music is nothing but marketing material to drive awareness of an artist."Now, I'm not going to speak for Arrington, but I will speak for myself, and note that I've been saying similar things for nearly a decade. So I'll defend my own statements and explain exactly how it fits into the point last week about all content being advertising -- and all advertising being content. First off, I don't think that recorded music only drives awareness of the artist. I think it helps drive awareness of a whole host of other scarce goods related to the artist. But awareness is the biggest and most important in implementing a useful business model. So I find it hard to see how it's either sad or stupid, considering that it's actually quite accurate and a fundamental understanding of economics would show how it's true. Besides, if that's really the saddest or stupidest (or both!) sentence Carr has ever read, he doesn't read much.
So why is Arrington right and Carr incorrect? Because Carr still doesn't seem to understand the difference between scarce and abundant (or infinite goods). He doesn't seem to understand externalities. And he doesn't seem to recognize basic econ 101 points, such as price being set at the intersection of supply and demand, or price being equal to marginal cost (two ways of saying the same thing). Finally, he doesn't understand that non-monetary value is equally as important as monetary exchange (and that non-monetary value can be turned into money). For someone who is apparently (is he really?) a well respected economic commentator, these are odd omissions to his education. With an infinite good, the price gets pushed to zero over time. Map out the supply and demand curves and you see that, and you can confirm it when you see that the marginal cost is zero. But this doesn't mean that all is lost. In fact, it's a benefit, because that infinite good now becomes a resource that makes any scarce good it touches much more valuable. In other words, it acts as "promotion" or "marketing material" or "advertising" for those scarce goods. But, you've heard this before.
This is also why all content is advertising. Content is an infinite good. All content advertises something and makes something scarce more valuable. Nick Carr's blog, for example, helps advertise him and convinces people to buy his book (a scarce good) or hire him for consulting (which is buying his time -- another scarce good). Billy Bragg's music acts as advertising for Billy Bragg. It helps him sell more concert tickets at a higher price, or better yet, embrace newer more interesting business models like Trent Reznor, Jill Sobule or Maria Schneider. All of whom are examples of using their content to sell something scarce. It's that content that makes the scarce item valuable, but the content itself, once it exists, is an infinite resource. Once you think of it that way, it's a promotional good that can be given to everyone for free, making every other scarce good you possess more valuable. It's hard to think of why you wouldn't want to promote that way.
And that leads us to Carr's mocking of Arrington with the following paragraph, showing how little he understands the difference between scarce and infinite goods:
"As a printed poem, one assumes, is nothing but marketing material to drive awareness of a poet. As a sculpture is nothing but marketing material to drive awareness of a sculptor. As a film is nothing but marketing material to drive awareness of a director."As for the first example, yes, a poem is marketing material to drive awareness of a poet. And that allows the poet to sell many scarce goods, including books of poems, the ability to write a new poem, the ability to perform the poetry or even to get a job (say, as a poet laureate or a poetry teacher). None of those things are possible if the poems are not known. A sculpture is not an infinite good, so the statement doesn't quite fit. But an image of a past sculpture absolutely does help promote the sculptor and get them additional work in creating new sculptures (scarce goods!). As for the film, we've discussed this in great detail in the past. It is marketing material to drive people to buy scarce goods: seats in a theater. Even the great theater owner Marcus Loew recognized that: "We sell tickets to theaters, not movies." The movie is the content. It "advertises" the seats. It makes those scarce seats valuable. The content, you see, is advertising. That's not loutish, sad or stupid. It's just a basic economic truth.
Other posts in this series: