Maybe there's a silver lining here. Most industries undergo consolidation, and as they scale up the barriers to entry get higher and higher.
Maybe, just maybe, the pastiche of stupid/crazy laws relating to the Internet will serve to foster more churn in the industry, and therefore more innovation.
Let's say this law passes in Italy, so YouTube essentially becomes a vehicle for corporate communications in that country and end users basically can't use it. What's going to happen? Those users are going to move to a competing service that's too small to attract regulators' notice, or to have operations in the country.
Clearly, this is a terrible and stupid idea. But maybe there's a fringe benefit to all of the terrible and stupid ideas flying around out there. The RIAA's reaction to Napster gave us Bittorrent, after all.
I was a 3-at-a-time Netflix subscriber until this news hit yesterday, and I really only used it for new releases. Now I'm a 1-at-time subscriber and working on getting an RSS + torrent solution up and running.
Short version: some of the facts cited in FSJ's argument directly contradict his argument. Having profits constant across 3 months while revenue and capex grows is *not* one of the many signs of AT&T's infrastructure malfeasance.
So this in-the-closet lesbian, who is anonymous because she has not been outed (yet) by the rental data, is now fronting a class action lawsuit which is going to get a ton of press and probably get her outed?
What's next? A class action suit against her lawyer on behalf of people in the class who were formerly anonymous but whose identities were discerned by interested people after hearing about the lawsuit?
So I'm one of the suckers who bought an iPhone (love it) and got stuck on AT&T (hate it). I was on a one hour conference call yesterday that my phone dropped three times. So I want to be clear that I think AT&T is incompetent, poorly managed, and operating on the borderline of fraud (they promise phone service, but it does not function like any phone service I've ever had before).
All that said, this FSJ post is a pretty good example of how tone and good writing can convey the opposite message from what the words and graphs actually say.
Take the section that reads "I mean look at the last three quarters. Like the surface of a pond on a windless day, right? Weirder still, over those three quarters, AT&T’s revenues actually grew by about $700 million. And still, net profit stayed almost dead flat."
That sounds pretty bad, doesn't it. Snarky and sarcastic and... hey, wait. It's actually saying that revenues went up but profit didn't. And if you look back to the charts, it's clear that that $700m revenue growth, in fact, went into capex. So the problem here is... they've reduced profit margins as revenues have grown so as to invest more? Isn't that kind of the opposite of the vibe you get from reading the piece?
And, wait -- should capex be linked to total subscribers, or subscriber growth? I mean, if you have 10 subscribers join in one month, and then 2 per month from then on (so you go from 10 to 12 to 14), you've (presumably) already built out capacity for the first 10 when they join, and don't need to buildout capacity for 12 and 14 new users in subsequent months. Sorry if my writing's not clear there. I mean, it's silly to compare capex to total subscribers (proxied by revenue); capex should be linked to growth, or derivative, of subscribers.
I think AT&T has dropped the ball big time, and should have spent far more on buildout than they have. I would cheer an FTC investigation of the company's failure to provide the service they promise. But this financial "analysis" is really just internet blowhardism dressed up with charts.
That's dishonest in a few ways. The copyright being asserted is over the broadcast stream, not the sporting event itself. You're intentionally conflating CBS' interest in protecting their revenue with the facts-not-copyrightable fair use defense.
Also, Justin.tv, much as I love them, doesn't take down infringing content. I watched MNF on the service yesterday, and it was (at the time) the most popular live stream on Justin.tv. For several hours. I imagine that's the case every Monday night.
I do think Justin.tv has some legitimate section 230 defense, but the fact is that they turn a pretty blind eye towards the content on the service, and the majority of their top feeds *are* unauthorized transmissions of copyrighted content. You can defend that, they can defend that, but to claim complete innocence and surprise is going to come across as disingenuous to anyone who's actually used the service.
I guess you'll also argue that the lower volume of applications has no correlation to the lower R&D budgets at most large companies? And because R&D budgets have no bearing on number of patent applications, clearly R&D is just less efficient now?
You're pretty good at the gay-baiting vulgarity, not so great with the reasoning.
Re: Re: (I always feed ferrets to my Ugly Anaconda)
Yes, I'm sure Microsoft, IBM, Google, and individual inventors have thrown up their hands and are refusing to apply for patents in order to protest the system. I expect to hear announcements at shareholders meetings: "well, we've got some great technology coming up next year, but we've decided not to patent it and just take our chances in the hopes that nobody else does, either."
The company was on the verge of bankruptcy. And, after the sale of assets to MySpace, the company will be wound down, creditors paid pennies on the dollar, and equity holders most likely SOL. Office space will be vacated before the end of the lease. In dissolution, the contracts are void.
Now, there are plenty of nefarious people in the world, but if you think this was the plan all along (we'll lose a ton of money and nose dive into bankruptcy so we can avoid paying artists), I've got some oceanfront land in Nebraska to sell you...
Actually, all there is so far is a guy at a conference saying they're looking at charging for data usage to disincent the heaviest users. You're right that there's no indication that using less will be a boon -- because there's no indication of any specifics whatsoever. You might as well say there's no indication that they won't hold your elderly grandparents hostage and demand your net worth in ransom.
In fact, there's nothing at all about whether this will only apply to new users or whether they're looking at applying it to existing users who signed up with the "unlimited" promise (and who therefore would be free to walk from the contract with their free iPhone, since this would clearly be a "material" change in terms).
Sadly, this seems to be a case of Mike speculating about what the news might be and then having a very strong editorial reaction. It's all good, but he framed his assertions as fact, and after doing a lot of digging, it seems pretty clear they're just his imaginings, based on a couple of sentences from an executive at a conference.
I'd be surprised if Amazon's cost on Kindles was less than the sale price. This is not a "profit on hardware, loss on software" model; in fact, I expect it's similar to game consoles, where they take a loss on hardware with the expectation of making it up in software.
To the extent that Amazon loses money on actual ebooks (which I'm very skeptical of), it's going to be because they see it as buying market share and establishing the company as the preeminent ebook retailer, and they figure that the long term profits will offset short term losses (perfectly reasonably business).
However, I really doubt the accuracy of this report, or at least the implication that it's the average across all ebooks. *Maybe* some high profile publishers/books represent a loss for Amazon, since they have a lot of leverage. I'd be shocked if that were the case across the board.
Um. So, charge Amazon what they'll pay today, and if that changes, change your wholesale price?
Do you really think the publishers should unilaterally lower their prices to $10, knowing that Amazon will buy the same quantity and sell at the same price to consumers?
I mean, the "I'm thinking long term" handwave is nice and haughty and everything, but that's really not much of an argument for this particular case. Given the facts as presented (which, again, I'm skeptical of), this is smart business from publishers.
Definitely take the figures in the article with a grain of salt. But if we accept them, it goes like this:
- Ebook wholesalers want $12
- Amazon wants to sell for $10
- Amazon covers the extra $2
Now, I'm a down on the publishing industry as anyone, but if Amazon's actually paying the premium, isn't this a case of *smart* business by the publishers in extracting some of Amazons' profits? What would be their advantage in selling to Amazon for $10? It's not like they'd move more volume, since it wouldn't change consumer pricing.
So, yeah, fantasy world and all that... but it seems to be working, at least at the moment. What am I missing? Why shouldn't they cash in on Amazon's willingness to take a loss to buy market share?
SOX is only about financial reporting, which most emphatically does not mean all reports that have to do with finances. Financial reporting means things filed with the SEC, with investors, etc. It has no bearing whatsoever on internal reporting, accounting, operations, taxes, etc.
That said, anytime anyone knowingly falsifies data, especially for contractual or financial purposes, it's called fraud. That really doesn't look (to me) to be the case here, but there's no need to drag SOX into this.