Pinker's Violence Fantasy: the Truth About War and Violence in the Post Cold War Age

The WSJ's article by Steven Pinker Why Violence is Vanishing illustrates the desperate nature of Liberals and the Modern Western Society (which is profoundly Liberal in the modern, PC sense). Wanting desperately to believe that there is no more reason to fight, sacrifice, and empower nasty and dangerous men to protect us, and build nasty and dangerous weapons, the hope is that by clapping real hard for fairies, ala Peter Pan, we can believe and make it so.


Pinker notes, accurately enough, that the growth of agricultural states and enforcement technology (swords, spears, arrows, etc.) allowed centralizing monarchs to cut down hunter-gatherer personal violence which was horrendous and daily. Enlightenment Monarchs in Europe further cut down violence that was constant and grinding by eradicating banditry, enforcing laws, and promoting safety. This is why native European martial arts and weaponry, including staff fighting, knife fighting, bludgeon fighting, and unarmed combat disappeared save Savate in Marseilles, an ultra-violent port that kept that art alive until the Twentieth Century turned it into a sport. All of this is true.

But what Pinker does not contemplate, is how violence particularly in Europe and China was compressed. True Renaissance peoples did not slaughter each other personally as Dark Ages people did, let along hunter gatherers … most of the time. But a third of German speakers were killed in the Thirty Years War 1618-1648 and the terms Magdeburg Quarter entered the terminology of Europe. In China, the Taiping Rebellion wiped out 20 million people between 1850 and 1864.

Technology and new social orders tended to suppress day to day violence. Neighbor did not stick a spear into neighbor, because he had run off with a daughter or wife. Disputes were adjudicated by the state, even in Aztec Mexico. Bernal Diaz Del Castillo in his "Conquest of Mexico" first-hand account notes how Montezuma spent hours every day listening to people who came before him to judge disputes, this from a people who practiced ritual human sacrifice and cannibalism (as did, notes Diaz del Castillo, all their neighbors and the allies of the Spanish).

BUT … when the state loses control, or warfare becomes "total" with new weaponry that makes old orders obsolete, as in the 1600's, or again in the 1940's, horror emerges. Ordinary Japanese men, often under strict orders from high commanders NOT to engage in rape, pillage and murder, and facing an advancing enemy, spent all their time doing so. The destruction of Manila as American forces advanced in contravention of the commanding officer's orders is one example. Done by men who would not have dreamed of ever doing that in Japan. The violence exacerbated by a civilian population accustomed to obeying orders and unable to offer any real resistance anyway.

Violence, by being so rare, becomes almost viral when it does break out, infecting people with horrific results. There is a scene in the otherwise tedious and boring movie "the Debt," where the villainous Nazi doctor says he knew they would succeed when Jews handed over their children. Von Wallenstein and Tilly were hardly nice men. But they would have found it inconceivable to boast of such a thing, because for them, violence was a path to glory. The idea, of killing children as a means to become a famous and accomplished man would have seemed like … madness. One only became famous by fighting a powerful foe that could certainly destroy you. There was nothing to be found of glory in killing children, old men, women, and defenseless men. Though certainly they did that, on attacks on towns, their views of violence was that their glory came in open battle against a foe well able to defeat them.

Now we come to the heart of Pinker's argument. Like the "War Nerd" Gary Brecher, Pinker believes that somehow humans have stopped becoming violent, and that war will no longer break out because, well dammit human nature changed. He hand-waves the wars and civil wars that have broken out since the end of the Cold War and nuclear duopoly, including the Iran-Iraq War in the twilight of the Cold War, the Central African Wars of 1998-Present (about ten million dead or so), the Sri Lankan Civil War, the constant wars in Sudan, Somalia, and Afghanistan, the Iraq War, the Afghan War, 9/11 and the prospect for non-state violence not seen since the Treaty of Westphalia (growth of non-state militias). Pinker points to globalization and trade, ignoring that some societies are permanent losers in that unless they …

USE WAR TO CONQUER OTHER PEOPLES.

Look at Egypt. It cannot as Spengler/David P. Goldman notes, feed its people, manufacture anything worth buying, or produce literate people let alone engineers and other college graduates who are employable. All it has is War. The hope of conquering Israel, taking the Mediterranean gas fields, and then going on to conquer perhaps weak Italy, rich in resources, slaves, food, land, and without any meaningful defenses or even the will to defend itself.

Egypt, in order to survive without war, would have to deep six all of Islam, spend its time studying math and science not heaving their butts into the air five times a day, use the scientific method not something written in the Koran to figure out the world, teach their women to read and write, outlaw polygamy, give women equal rights, allow religious freedom and intellectual freedom, and promote a national concept of hard work and studying. Egypt would have to copy … China. And they cannot even be China, much less South Korea, Japan, or Finland. All that would destroy nearly everything that makes Egyptian society. The same goes for nearly all of the Muslim world, which would have to cease being Muslim if it is to eat, unless it makes war.

What Pinker does not realize, is that the AK-47, easy GPS, nuclear weapons from Pakistan, Iran, China, and so on, allow a vast equalization. Pakistan can cow the US, attacking our embassy in Kabul according to Admiral Mike Mullen in sworn Congressional Testimony, because they have nukes and we are afraid of them. The same is true for all those North African regimes. Tunisia, Egypt, and Libya cannot feed their people. But they can cross the Med in boats, come ashore in Italy, France, and Spain, and simply take over. Killing any who object. That's violence, and violent enslavement. Which awaits Europeans who have a toy/pretend military and no will to use even that.

An example of Pinker's blinkered, utopian views are below:

Another pacifying force has been commerce, a game in which everybody can win. As technological progress allows the exchange of goods and ideas over longer distances and among larger groups of trading partners, other people become more valuable alive than dead. They switch from being targets of demonization and dehumanization to potential partners in reciprocal altruism.
For example, though the relationship today between America and China is far from warm, we are unlikely to declare war on them or vice versa. Morality aside, they make too much of our stuff, and we owe them too much money.
A third peacemaker has been cosmopolitanism—the expansion of people's parochial little worlds through literacy, mobility, education, science, history, journalism and mass media. These forms of virtual reality can prompt people to take the perspective of people unlike themselves and to expand their circle of sympathy to embrace them.

The War Nerd has said the same thing, and much the same was said in … 1913. Britain and Germany simply traded too much with each other to go to War. This was also said in 1938, and of the US and Japan in 1940, which had considerable trade.

What neither the War Nerd nor Pinker really understand is how much of a loser globalization makes a lot of societies and people. Now Egypt, as Spengler notes, has to compete with China for food. As does, note, the US. The US can compete, because it is a richer society. Egypt cannot. So it is starve or war. Egypt will choose … war. Because the cost of War has gone down.

Most "loser societies" do not believe that they will pay any real price for War, and discount their enemies ability to match their "fighting spirit" and willingness to win. Advantages in jet planes or nukes are discounted, and perhaps not too unrealistically. Israel in 1973 had nukes, and Egypt still attacked it. Israel at one point faced annihilation by Egypt, and did not face nukes. If Israel did not use them, in its then greatest hour of need, would it ever? [Likely, not.]

Western societies are often, for the most part, unable to offer violence in any meaningful way. Save fantasy violence in movies, and the idea expressed in recent TV shows and movies that the public wants violence done on its behalf to be safe, no more 9/11's, but does not want to know how it was done or who did it. The violence is kept secret. No bodies in Afghanistan show, nor in Iraq now, though there are plenty. Still even less coverage of people killed by drone attacks in Yemen, Somalia, Sudan, Libya, tribal Pakistan, and rumored, Kenya, Tanzania, Eritrea, and Ethiopia.

Meanwhile "loser societies" remain immersed in violence. Violence in unimaginable and unreported ways permeate every inch of daily life, particularly in Muslim society and Latin American society. Santa Muerte or a thinly Catholicized Aztec Death-God, demanding human sacrifice, is rising, with people being tortured and killed over Twitter comments. Often the mass violence has no purpose save the satiating of the killers desires for murder and death. Given the widespread prevalence of human sacrifice and cannibalism that the Conquistadors found in Mexico (not just the Aztecs, EVERY TRIBE DID IT), you might argue that Mexico is reverting to pre-Columbian violent type.

Muslims have daily violence in their society on a deeply personal level, widespread, as well. Women are genitally mutilated, often honor killed, rape is done by judicial punishment, hanging and stoning to death for adultery is on the rise, child brides are increasing, and so is violence between Shia and Sunni, and against all non-Muslims unlucky enough to live in lands filled with Muslims in any number. This is the advantage, so Muslim thinkers and Mexican Drug cartel members alike, view versus the weak and soft West which is unable and unwilling to deal out violence except when it can massively pretend it is not.

Pinker and Brecher alike share in my view, a fundamental flaw by accepting the past as an absolute prediction of the future. They overestimate trade and cosmopolitanization. As Mark Steyn notes, the arrow of civilization does not go one way, women in Cairo in the graduating class of the University looked modern in 1959, and still fairly modern in dress in 1979. Today they are muffled in Burquas. Kabul in the 1950's had women in modern dress in record shops.

Most of the world's population lives in a place where people worship Santa Muerte, or the governments urge them to please on no account kill and eat Pygmies or Albinos for magic powers, or where women are honor killed because they talked to the wrong boy. These are places where commerce means only poverty, because now they must pay more for food and everything else, and they have nothing to sell. These are places where violence is a way of life, constant and casual, and where it is viewed as the best way to get ahead in life.

Globalization has hotwired these places right into Western civilization, and they are not being removed any time soon. Violence, and disturbing violence, are only going to increase. Why? Because the State is a joke, unable to stop violence any more (quick how many Flash Mobs have been crushed) and only able to send middle class people to jail for improperly filling their recycle trash bins. While all the while lacking any external measures to deal with violence except things done in secret and willingly ignored.

Pinker, and Brecher, are state of the art circa say, 1975. Today, they don't grasp that failing states all over the globe (particularly in the West where violence to suppress greater violence is not allowed against non-Whites, see the London riots) running hand in hand with moral pretensions, are easy pickings for failed societies that live in violence. For now, the great majority of Santa Muerte's violence stays South of the Border. That is unlikely to remain so, any more than Muslim violence will remain mostly outside of the West either.
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Steve Jobs And The End of Apple

Steve Jobs announced his resignation from Apple Computer. Is this the beginning of the end for Apple? Previously , I wrote that Apple is "trapped" in China. Without Jobs, that trap is likely to be sprung, making Apple just another HP, or Dell Computer. A commodity company making a commodity product.


Jobs, besides his design vision (less than appreciated, witness his famous "you're holding it wrong" video about the Iphone antenna screwup) understood what made Apple different. Which was software and hardware integration. Far more than rival products, Apple products "just worked." So they could charge a premium over rivals for making a system that ordinary people could use, mostly, without lots of help and hand-holding. Oh yes, there was the yuppie, SWPL-snob appeal, the trendiness, the design mastery, and the hype. But simply making things work was the core of Apple's success. There were other MP3 music players, and other smartphones before Apple. But none that made using either device so easy.

The danger for Apple is of course, China. Chinese contract manufacturers make almost everything for Apple. With Steve Jobs in place, Apple could cajole, threaten, and flatter China's top political leaders, because Jobs was a crony of Bill Clinton, Al Gore, and Barack Obama. Current or former Presidents and Vice Presidents and thus important. This is why Apple until recently was not the target of widespread gray-market manufacturing and selling. The clone-Apple Stores opening up by pirate retailers, with genuine Apple merchandise, was evidence of Steve Jobs being unable to fulfill this role.

Yes, successor Tim Cook is quite able in wringing inefficiencies and costs out of Apple's supply chain. But that was not the skill-set of Steve Jobs, and what made Apple great. What made Apple great was stuff that just "worked" ... and keeping a flood of copy-cat merchandise out of places like Asia, Europe, Latin America, and North America. Cook lacks the connections and cronyism to top Democratic politicians needed to keep Chinese Contract Manufacturers, many of them connected to their own top political people, from simply running off lots of extra Iphones, Ipods, Mac laptops, and the like, and selling them for their own pure profit.

Really, what's Apple going to do? Sue the cousin of a top Politburo leader? When they flood not just China, but Japan, South Korea, Taiwan, Singapore, and Europe, and the Americas with the exact same kind of Ipod and Iphone made from the exact same factory as those Apple takes delivery of?

All that money is just sitting there, on the table. Apple has margins of around 35%, astonishing for a computer company (the industry average is about 4-8% or so) and in part that depends on there being limited, and Apple-authorized supply of their electronic merchandise. No, Best Buy and Amazon will not sell gray-market merchandise. But Mom and Pop retailer and swap meet and flea market folks will, at far less prices. At least part of the untold story of the DVD collapse in terms of prices has been the easy availability of DVDs from Asia on the semi-black market. The same factories that churn out say, copies of the latest Hollywood blockbuster on contract will inevitably run off millions more for their own sales. "Hostel" producer-director Eli Roth famously discovered copies of his movie on sale in Mexico city for what amounted to twenty-five US cents. They were pirated DVDs of course, but ran just the same. They were no doubt pressed from the very same factory that ran off officially authorized copies for sale in the US.

HP's discontinued tablet, selling at $99, was sold out in a matter of days. That's the price point for things like an Ipad. It is naive and unrealistic to expect Apple's manufacturers to not sell those things for about that price, one way or another. What the hell do they care about Apple's intellectual property? Contracts? Rule of Law? In China the rule is of crony, of power, of connections. And nothing else. The Red Emperors, Princes, and the like do as they please. Steve Jobs when he was healthy was able to delay this process, but even had he not been sick, these contract manufacturers would end up screwing Apple over. In order to make more bucks.

The "Chinese advantage" has always been a trap. Yes, manufacturing costs are far cheaper there, but producing things in China just makes it easier for the factory to run off millions more copies and sell them on their own. Apple post-Steve Jobs is going to be a wonderful example of just how much a trap the Chinese manufacturing cost-advantage really is, and how far a company can fall. When its previously expensive, hip, and trendy stuff gets sold like pirate DVDs.
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China Wins the Future

Lots of people from Thomas Friedman to Barack Obama wish the US were more like China. I thank God every day it is not. Slashdot has a story and comments about a derailment of the high speed bullet train that led to numerous dead and injured, and coaches falling off a bridge. Only a few months too, after Railways Ministry officials expressed concerns that safety standards had been ignored in building the high speed train network. The claim of course was retracted, but undoubtedly true.


Winning the future, Obama's "WTF" slogan (no I am not kidding) requires more than building up pirated technology in a slap-dash manner, cheaply. It means innovation. Which in turn requires … property rights widely respected and widely dispersed. China is again regressing to its Eunuchs-on-command-from-the-Emperor mode. Brilliant men either make a few, poorly understood breakthroughs (gunpowder, magnetic compasses) or copy something else, which then goes stagnant. Since there is no one at a deep-wide level to push technology ever further.

The West did not invent: gunpowder, magnetic compasses, paper money, printing, civil exams, and a lot of other things borrowed from China and India. But what the West did do, far better, was push advances constantly. Relentlessly, generation after generation. So that every twenty years there were newer and better navigation devices, charts, understanding of navigation, time-pieces, calculation log-books, and weapons. Made possible not by people under control of the Emperor, or the Central Party Oligarchy, but by many competing, widely distributed, always on the make ordinary folk trying their best to improve their lot every day.

The West beat the best brains on the planet. The West never had Court Eunuchs to match the Chinese Emperor, or the Ottoman's scholars, or the ones in India. But it did have the Beretta Family, and the Caslon family, and the Caxton family, and the Wright family, and many more. All building on the work of others, to constantly improve technology to their own advantage. China has nothing like it.

There are many talented people in China. But their innovations, their designs, will go nowhere for their own advantage. No one is going to invent anything for the glory of the Emperor, or Central Party Committee, and the advantage of Red Princelings. Instead that lack of ability to better one's own self except by examination and rising in the Emperor's (or Central Party Committee) service means a mind-bending bureaucracy stifling anything other than stealing some other culture's advances.

That's not winning the future. More like heading for a crash, as the ability to work smarter with resources diminishes. As Jim Chanos famously observed, the USSR grew tremendously from 1946 up through the late 1970's. Then productivity hit a wall. All the cement had been poured. All the villages electrified. All the people taught to read. All the highways built. All the peasants sent to technical school. And productivity fell, year after year, in accelerating fashion. Because fundamentally, people won't work hard for anyone but themselves. Slaves may fear the whip, but avoid any serious work for their masters. Meanwhile the genius of Napoleon, a former peasant himself, was to make French peasants small landholders. Give a man a piece of property, no matter how mean, and a chance at a family of his own he can improve, no matter how small, and he'll fight to the death for it.

If you wonder how Napoleon managed all those victories, against so many, for so long, before luck ran out, that's how.

The US has many faults, but it is not China. And for that I thank God.
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The Power and the Vulnerability of the West

The standard narrative by most commentators looking at Western vs. non-Western conflicts is either Steyn-ian demographic doom or Sailer-esque insouciance. Sailer wrote on the 20th Anniversary of the "Highway of Death" and the Western air dominance over Libya, asserting that the West can always dominate adversaries as long as it does not occupy them. Mark Steyn notes that differential birth-rates among non-Europeans both inside and outside Western nations promises to transform the West into basically, variants of non-Western nations peopled almost exclusively by non-Western people. That the demographic freight train is unstoppable. The future for America being Mexico, for Europe, Islam. In reality, things are not so simple.


It is not that simple because the West has advantages the non-West lacks. Which is, basically an open-ness to change, including fairly radical social change, driven by technology. At least in part, this has historically been driven by the West being relatively depopulated compared to rival civilizations, and therefore having fewer institutional and mass population centers of resistance to technological change. The compass, gunpowder, paper money, were all invented in China but took hold in the West. Being constantly improved in the West while they languished in China. The fate of the Zheng He's fleet (burned to the waterline by the Court Eunuchs) contrasts with the voyages of Columbus, Vasco de Gama, and others in the West. Where constant improvements in navigation or firearms or money meant increased wealth all around, particularly those who could provide better tools. If nothing else, Western society was small enough so that it did not have massive centers of resistance to social change.

The Western medieval knights, were rapidly abandoned even before the gunpowder advent, with the superiority of the pike square. A bunch of peasants using pikes (and archers in the center) were certainly cheaper than mounted, armored knights, who would require an entire estate to maintain. Later, harquebus and musketeers were even cheaper. And far more deadly. While Europe was radically transforming its military to ever deadlier, ever cheaper versions, Japan under the Tokugawa Shogunate, used muskets to beat its rivals, and then outlawed firearms. Fearful of the social changes making peasants more deadly than the samurai would bring. This led to the domination of the Black Fleet under US Commodore Perry. And the wrenching modernization undertaken, as the shock of Western superiority led to hurried efforts to catch up to Western superiority. The Japanese found they had nothing in their arsenal that could even touch the ships of Perry's fleet in Tokyo Bay.

Two recent maps, from a paper recently published, hat tip Slashdot, shows the top science cities in physics and chemistry. One can see the physics maps here and the Chemistry maps here. The more green a circle is, the more top quality research (as measured by the paper, including originality and new understanding) is done. The more red the circle, the more second-rate, low quality (basically merely copying other research) the city has produced. Larger circles denote more research, and smaller circles less volume of research.


The visualization tool from Google maps is stunning. It shows the dominance, of the East Coast of America, a few institutions on the US West Coast (Stanford, then Berkeley, then UCLA/USC), and then secondarily Western Europe, in the UK, Northern Europe from Northern France, Switzerland, Northern Italy, Germany, Sweden, and Norway, in both Chemistry and Physics research. The highest quality of research is done in these locations (with the US leading) and the most volume. [The map above right is of the top Physics locations]


Almost no research of any kind, is done in Latin America or Africa, and that which is done is mostly red (low quality). Russia puts out high volume, but low quality research, and the same is true for China. Japan and Singapore are the only non-European/American nations that puts out high quality and high volume of research in chemistry and physics. [The map above right is of the world chemistry research.]


While there is much to criticize about the US higher educational system, and recent efforts as noted by Steve Sailer to push women into dominance in science at places like MIT put US dominance in science at risk, the US lead is overwhelming. But it is also vulnerable. Just a few locations in the US, MIT, Columbia/NYU, University of Illinois Urbana-Champaign, Sandia Labs, Stanford, Berkeley, and UCLA/USC, account for most of the high quality research done in the US. Destroy those cities with nukes, and you kill the entire research advantage of the West. The ability of the West to come up with new, and more deadly technology: better, autonomous UAVs that cannot be jammed, micro UAVs that can observe jihadis without being seen, even small ones with weapons able to kill individual jihadis when opportunities arise. Or the ability to sniff out explosives, with tiny portable devices, or drugs, or other contraband (smuggling of which helps fund jihadi networks). [The map above is of US Physics research output by city]

Just as importantly, advances in chemistry and physics allow Western nations to generate material advantages. The holy grail of electric cars is a self-charging (via powerful solar arrays) system that can store massive amounts of electricity. Both depend on significant advances of chemistry (battery and solar array technology) and physics. Other advances could include networked UAV-based anti-ICBM systems using powerful lasers (which would require advances in chemistry and physics), negating the advantage of nations like North Korea, Iran, and Pakistan, which possess or will soon, considerable amounts of ICBM nuclear missiles. The play of these failed nation-states has been to use WWII technology (the V2 and nuclear warheads) together to act as a shield against US or other Western nation reprisals, with the threat of nuclear annihilation of those nations (say, Denmark) that don't fall in line with Islamist domination, and lack significant nuclear forces or protection of their own. Even Denmark could put together an array of satellites orbiting around with lasers powerful enough to blast ICBMs out of the sky during launch phase. The way the Holy League defeated the Ottoman Turks at Lepanto, despite the Papal States, Genoa, Tuscany, the Kingdom of Naples and Sicily, and Venice being by European standards, second raters (only Spain was a major power).

The decisive hinge therefore of Western and non-Western fate will be, the ability of Western nations to respond to the obvious targeting of major cities, and the ability of ancillary research universities to replace those lost to nuclear or biological or chemical weapon terrorism. It is pretty unlikely that the jihadi networks will target research universities, the lure of major population centers being irresistible. But many major research universities sit in major population centers. MIT is located in Cambridge, near Boston. Stanford sits in the Bay Area, as does Berkeley. Columbia and NYU are in New York City. London is the site of many of the UK's leading universities. Germany, France, and Switzerland have more dispersed universities, and the US's key research institutions of Urbana-Champaign (University of Illinois), Sandia National Laboratories, and Carnegie Mellon (Pittsburgh) are located in second, third, or lower tier cities and towns.

The non-Western world has nothing like the US/European/Japanese university research system, government supported, doing basic research in physics, chemistry, and other areas that supply potential Western advantage. Muslim, Mexican, and African societies have failed, almost entirely, in even establishing research universities. Those in Russia and China do mostly derivative, low quality work though they do have a lot of volume. But as in WWII, technological advances in things like RADAR, computers, bombsights, aircraft design, and crucially, primitive ground proximity fuses (the key American artillery advantage) can make up for disastrous early defeats, poor generalship, and bad tank designs. The American ability to explode artillery shells directly overhead tanks, or advancing infantry, was the great killer of German troops in the West, along with fighter-bombers like the P-47 Thunderbolt and P-51 Mustang. And on the other side, the German advances in jet engine technology and small arms (the assault rifle prototypes) came too late and in insufficient numbers to beat back the US tide in the West, despite better tanks and artillery.

What in particular, Muslim societies have bet on, against the West and China, is jihad backed by massive amounts of manpower and fanaticism. This has been the traditional way of Muslim warfare, and the uprisings all around the Muslim nations, provoked by food shortages and crisis, are at least in part aimed at restoring Muslim dominance by traditional mass jihad.

This has been tried before. It was quite successful against the Byzantines, the Eastern Roman Empire, taking away Christian North Africa, Spain, the Middle East, Sicily, Southern Italy, and Southern France with ease. Requiring a slow, centuries long effort in Spain, and several hundred years effort in Sicily and Southern Italy, and France, coupled with constant vigilance and escape from Muslim raids. Muslim jihadis were raiding Rome and the Vatican as a matter of course, until the 1400's.

Against the main force of the West, it has been mostly failure. The siege of Vienna failed twice, as massive amounts of Muslim manpower ran up against European fortifications in the gunpowder age, and better quality of gunners. Against more modern forces, particularly the Second Barbary War against the US, Muslim forces failed. Muslim forces cannot put up modern air combat planes into the sky. They do poorly with tanks, and artillery. Muslim forces do best with irregulars, aiming to dominate by numbers. Against forces with superior technology, and a will to use that technology to slaughter them in great numbers, they fail. Kemal Ataturk's famous epiphany came at the slaughter of Ottoman forces at Meggido, as Allenby's combined arms of aircraft, mechanized vehicles, and artillery slaughtered the ill trained, and substantially larger Ottoman forces.

Achieving military dominance, as Victor Davis Hanson points out in "Culture and Carnage," is not something that is the mere matter of copying Western technology. Because Western nations are willing to upend their own social systems in the pursuit, generally speaking, of material commercial and military advantage, by adopting ever more efficient technology. Technology that makes each man, either in the workforce (machine tools, computerized machine tools, and new materials) or on the battlefield, more efficient. It is the civilizational response of a people facing strategic threats all around them, who are few in number.

The most likely outcome, therefore, is a collision of cultural strategies between Europeans and Muslims (to a lesser extent European descended peoples in the Americas and those of mestizo origin). The Muslim strategy is to conquer by birth rates and mass jihad, in various forms. The European strategy is to dominate by technology that is ever more efficient at both creating wealth and battlefield dominance. The key is the shortage of much of everything, driven by China's emergence on the world stage, and insatiable demand for raw materials.

The easiest way for Europeans to keep their welfare states, which they like, is to kick out all non-Europeans. Which, one way or another, the will do. Perhaps not all, and some European states might fall under Muslim domination, leaving European neighbors to conquer them in the name of eliminating threats. No one thought much of Germans prior to Bismarck -- the Germans were the dis-united, kicked around afterthoughts of Europe. But the ability to leverage advances in chemistry and physics, and combine that with a small but disciplined fighting force, made them formidable by the time of the Franco-Prussian War.

Conflict, therefore, is inevitable. For their part, an impoverished Muslim mass of people in North Africa and the Middle East (including Turkey) see their only way out of poverty through what amounts in one way or another, mass jihad. An exodus in one way or another, into Europe, which is rich and poorly defended. For their part, Europeans (Sarkozy is instructive here, demanding and acting on the demand that Khadaffi go, because he fears Khadaffi sending millions of his people, all Muslims, to France eventually) do not want an influx of Muslims. Their PC/Diversity leaders to the contrary, they want the Muslims and non-Europeans they do have to leave. For nothing else, the preservation of the Welfare state. Which is fundable if they continue to make technological advances and do not have to support a massive Muslim population unsuited to a technology dominated society.

For their part, Muslim jihadis are likely to continue to target iconic buildings and cities in the West: London, Paris, Rome, above all New York City. With perhaps serious damage to research institutions housed in these cities. Attacks on urban centers, regardless if done Bombay Style, or through weapons of mass destruction (airliners loaded with jet fuel, chemicals, biological weapons, and or nukes) are likely to decentralize Western society as attacks on critical centers have in the past. The danger here is that the West would possibly lose some margin of research edge, which is realistically its only hope in competing against manpower-driven rivals.

Contra Richard Florida, wealth comes not from trust-fund reliant urban hipsters, but the sort of folks who founded Hewlett-Packard, or Apple Computer, or MicroSoft, or Intel Corporation. Entrepreneurs and businessmen reliant upon a large pool of technically trained people, and basic research coming from technology and science driven universities. University of Texas at Austin, for example, is no better than LSU, while the University of Chicago, and University of Michigan, outweigh them both. But Stanford, Berkeley, and MIT seemed to have produced the most companies out of the basic research in science and engineering.

This makes Western cities far more productive, than Muslim or Mexican ones, but not in the way most pundits think. Antique stores, tragically hip tend-setters, gays, entertainment/fashion people, do not create wealth. They merely sip at the froth of the wealth created, by pocket protector wearing engineers and scientists. Who in turn create research only in stable institutions, located in middle to upper class income cities, that are livable and not third-world style hell-holes (sorry Tulane University and New Orleans), with a critical mass of colleagues, students, and potential employers.

This makes Western cities, such as San Francisco, Berkeley, Cambridge and Boston, New York City, London, Geneva, Zurich, Munich, Hamburg, Cologne, and Chicago vulnerable not just to dirty bombs, nukes, and chemical attacks, but demographic transformation. California could spend all its wealth in a vain attempt to educate immigrants from Chiapas, and their children and grandchildren, to levels of White and Asian achievement, and destroy the ability of the University of California at Berkeley and Stanford University to continue cutting edge research into physics and chemistry. Destroying in turn the ability to innovate and create new industries and new jobs. Demographically, the transformation of California from 80% White in 1960 to 40.1% White today, is a serious and probably mortal threat to California's technological dominance.

You cannot sustain world-class research in physics and chemistry with the population of Mexico. Which California has been transformed from, the state of the Beach Boys and Apple Computer to Chiapas and Cuidad Juarez North, in the space of two generations. Long term, Stanford and Berkeley are finished, because all available money in California will be spent on basic K-12 education, and Affirmative Action at the University level for Chicano Studies and so forth. The same fates await the University of Chicago, and Urbana-Champaign, as Illinois transforms into majority-Mexican. This will move the center of research power to Boston and New York, and the surrounding areas, which are becoming Mexican majority the least rapidly. "Whitetopia", the area defined by Black Author Richard Benjamin, basically Washington, Oregon, Idaho, Montana, Wyoming, Utah, North Dakota, South Dakota, and Nebraska, have significantly no real research universities and no real output in physics or chemistry. Second-tier White states, with significant Black populations but miserable economies that don't attract many Mexican immigrants, such as Oklahoma, Arkansas, Louisiana, and Mississippi have at best, lower level (both shade of green and volume) research universities, but that is better than the basically none at all (confined to Washington and Oregon, what little there is) of Whitopia. Georgia, Florida, Virginia, and North Carolina all have significant research universities, whose output while second-tier, is respectable. However demographically, they are somewhere between Texas and California (doomed to Mexican majority) and places like Alabama (poor, likely to remain Black and White only).

The advantage European states have, is the ability for some of them to kick out immigrants, particularly places like Germany and Italy and Switzerland (there is less will in the UK or France to do this at present) and so spend most of their education money on things (research on physics, chemistry, and other science/engineering subjects) that create wealth, power, jobs, and advantages. Instead of pouring money down a rathole of attempting to make Muslim, or Mexican, or African immigrants into respectable, bourgeois, science-minded Europeans. To some extent, power is likely to pass, from the US, back to Europe, because their demographics are more favorable, if they act now to kick as many non-natives out. This would mean in practical terms, technological innovation over the next thirty years is likely to come from Europe, not America, and not China (which has volume but little original research).

In the US, technological power and thus wealth creation, is likely to pass to the East Coast again, specifically Boston and New York City. Both of which have remained White enough to attract and maintain world-class researchers at world-class universities. Both of which also seem to have enough of a middle class tax hinterland to support research, instead of what amounts to variations of "University of Phoenix" or Devry Institutes. This certainly sets up a conflict, between a mostly Scots-Irish population ethnically cleansed out of California and the Southwest and parts of the South, and the old Puritan-Progressive population of the Northeast. It is worth noting that while the technological base of the US military depends almost entirely on work done at the basic research level at the few East and West Coast Universities, the manpower of the Military is drawn almost exclusively from West and South White populations.

In the end, we are likely to see over the next thirty years, a nearly total confrontation in all spheres, between a very thin population, almost exclusively White, relying on ever changing, and more powerful technology, and manpower based swarming strategies, designed to overwhelm while not exposing a mass to firepower. Against a backdrop of shortages of almost everything, driven by Chinese demand. While manpower is not a power to be dismissed, against shortages of almost everything, technology often wins. Not every time, but most of the time.

The power given by something as simple as Google Maps shown by the research paper, to visualize data, is likely to be more decisive over time, to a population no matter how small, attuned to use it. Technology is value neutral, except for one aspect. Those who are willing to change their societies and persons, to use more and better technology, succeed more than those wed to a way of life, above all else. Successful use of technology requires its total embrace. Not elevation of God, Allah, or racial characteristics (La Raza, Ubermenschen, etc.) above all else. Instead a constant, restless seeking of advantage.

At any rate, the multicultural, diverse world of today and tomorrow hardly resembles Disneyland's "It's a Small World" Ride of handholding, singing children. Rather, a fairly Hobbesian war of all against all.
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The Future Lies In Your Hand: Phone TV vs 3-D TV

A recent series of Financial Times columns shows why 3-D TV will not be Hollywood's savior, and some combination of Kindle, Nook, Ipad, Ipod, Iphone, Netbook, or other cheap, flexible, and handy tablet sized device will be the consumption device of the future. This has profound implications for the type of media, with the possibility of all sorts of new content over-turning the Big Media stranglehold, and not incidentally refighting the culture wars. Think a lot more "Rifleman" type Westerns, instead of say, "Glee."


First, a Financial Times Panel tested 3-D TVs and the results were not pretty. Just as most 3-D films have flopped (there's only one Avatar), daily use of 3-D TV is not a happy experience. Glasses are required, and it can be a strain for some. The FT panel, including six kids, four girls and two boys, ages 2 to 10, with some grown-ups, found the extended use tiresome:

At the same time, even 3D-light can be a strain to watch for some. After an hour, at least one child had her plastic glasses off and was curled up in a ball, declaring that her eyes hurt.

By the time the children’s test session switched to Pain – a video game in which a rubbery adolescent thrill-jockey is launched from a slingshot against buildings, rubbish bins and other urban-landscape targets – the kids were happy to play in plain old 2D.

The 10-year-old Mhairi summed up: “It was fun – but it made me tired.”

The 3-D effect for the World Cup broadcasts was compared to cut-outs in dioramas, not a fully immersive effect.

Another Financial Times article notes that Sony has bet big on 3-D TV:

A nimbly-executed product launch is no guarantee that consumers will embrace Sony’s 3D world. A shaky US economy, the scarcity of original 3D content so far, and consumer discomfort with clunky 3D glasses have slowed initial sales of 3D TVs.

Research groups estimate that 3m-4m 3D sets will be shipped this year, equal to about 3 per cent of global high-definition TV sales and below some analysts’ and industry executives’ early predictions.

Sony's ambitions are quite large in this area, but history shows that consumers prefer convenience over high-quality of reproduction. While obviously, sound and color in theaters won over silent films and black and white movies, consumers were not required to invest in anything but a ticket. Perhaps only color television and High Definition (the latter still only at 80% penetration in the US market) mark consumer preference for higher quality media reproduction, over convenience. Every other major consumer decision has been in favor of convenience. From the victory of VHS over Betamax, and later VHS over LaserDiscs, to Walkmen and cassette tapes over LPs, then CDs over LPs and tapes, and finally MP3s over CDs, consumers have been choosing convenience and on-the-go music over high quality reproduction, and the same with video.


Do consumers have an extra $700 to spend for a 3-D TV? Likely, no, not most of them. They'll be hard-pressed with predicted $5 a gallon gas and many energy and commodity shortages to spend much beyond a price point of $100 or so. Perhaps even less, around $75.

And what sort of device would be sold at that price point? A massive, home-based theater system? Nope. Something cheap, fast, and very, very handy. A super-video Ipod, basically, that can also double as an e-reader, an e-magazine reader, and so on. A cheaper, more versatile Ipad, basically. Aimed at the mass market.

With the FCC imposing by regulation, net neutrality, price pressures will naturally inhibit streaming video over 3G, 4G, and Wifi/Wimax networks. This makes the model of "download and go" and playing the media, anywhere, anytime, more probable. The Ipod/Itunes model. People like having a massive library of music, it is quite likely they'll like a massive library, on the go, convenient no matter connections or not, of video.

We are likely to see an explosion, of cheap, more broadly appealing content, at the 99 cents model, set by Itunes and apps on Iphones. This can be singles, short stories, e-comic books, and "episodes" of serialized video content. And unlike the old style of top-down, 18-34 female oriented TV (and often, movie) content, the new media devices will be completely open to anyone. The Band "OK GO" detailed on the WSJ how they used the internet, YouTube, and personalized content to make a comfortable living without record label contracts. Various other artists are doing the same, selling everything from dinner with them to personal concerts to personalized swag and songs and so forth.

Consider this, in the new hard-stressed economic environment, most US consumers will be spending considerably less on media and entertainment. They'll want a personal, cheap device to keep (likely with their computer) a media library of songs, movies, TV shows (by any name), magazines, books, and so on, all there for consumption in a hand, personal, and affordable form. This will herald a big change in how media is made and distributed.

The current model requires expensive budgets, and has many gatekeepers. Movies are expensive gambles, and so too are TV shows, with production budgets at around $3-4 million per episode, at around $66-$88 million per year. Much of the latter only paying back if a show hits at syndication or foreign sales, both under severe price pressure.

By being able to charge, directly, consumers of serialized entertainment, the break-even rate at roughly 99 cents per download is only 3 to 4 million downloads. And of course, the more downloads beyond those levels, the higher the profits. By cutting out the TV Network and advertiser supported middle men, much lower levels of viewership can hit break-even points. And a limited, three episode run can be constructed, contingent on say, downloads covering costs and indicating future profits by demand.

What does this mean? Far fewer things like "Nurse Jackie" and a lot more entertainment versions of "Call of Duty: Black Ops." Because content creators won't get paid unless their content is popular. Unlike today, when stuff like "Kick Ass" or "Scott Pilgrim Versus the World" makes creators rich despite almost no real appeal to anyone. Yes this also means a lot more "Twilight" like stuff, with hunky bad boy supernatural or superpowered Alpha males, and loser beta males, to appeal to the female market. But it will be balanced by stuff that guys like. Can anyone imagine a network TV show that portrayed Cold War Black Ops heroically? Even "the Unit" had to play the anti-Government, soapy, female-drama relationships angles to get on the air.

And the ability to create e-comic books, or e-books without major publishers, means even more content oriented towards (the only underserved audience, men) is likely. Certainly, Amazon and Itunes are vying to become profitable portals for this content, each in their own way. Netflix is likely to be a player, with perhaps Redbox and a few others (MicroSoft?) as well. But the model established with consumers seems to be, purchase a cheap download, put it on your computer (and media player, phone, Ipad, tablet, etc.), and play the media anywhere.

The corollary to this, obviously, is that a new shift to 3-D content will not bail out Hollywood's content model. Instead, they will face constant erosion, not just from rampant piracy (made worse by recession), but viewer apathy. Hollywood has bet heavily that they can continue their current business model, where few movies or TV shows actually make money or find audiences, but content generally is subsidized by a few massive hits (and ancillary revenues, mostly from toys/merchandising) and repackaging old content in 3-D, the way old catalogs found value by making DVDs of TV shows and movies often decades old. Hollywood desperately hoped first Blu-Ray and then 3-D would prevent them from rethinking their business models and the lucrative role gatekeepers, and the entire infrastructure plays in creating and delivering content to consumers.

This seems unlikely to happen. Rather, it seems clear that democratization, and just as important, re-massification of serialized entertainment (TV) and movies is on offer with the transition to Ipad-style entertainment. Hollywood's creative people will have to emulate OK Go, rather than the current audience-unfriendly model. Direct engagement with fans, by producing content or goodies they pay for directly, will be the model. Perhaps some content will feature ads, or embedded product placement, at reduced cost. That too, will obviously will be aimed at a very broad audience, rather than a narrow one, in most cases.

It won't all be a land of milk and honey. Privacy issues and exposing user's data, including age, gender, location, politics, and sexual preferences, are going to be major issues for interactive content, they way they are now with Iphone and Google Android apps. Abuses will occur.

But the major shift in entertainment is consuming cheap content on the go, personalized. Not massive and expensive home entertainment systems consumers just cannot afford. THAT promises to be a big change certain to shake up Hollywood.
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Crime and Currency

The Stuxnet worm is in the news. Was it the Israelis? The CIA? The Chinese? No one knows, or even what the aim was (hindering Iran's nuclear infrastructure, industrial sabotage against Siemens by the Chinese, or simple extortion on a wide scale) but the event was significant in the risk it poses to infrastructure, and more widely to the West's, and America's, commercial payment system. Growing cyber-crime might be the one thing to restore cash to its former glory. As the world discovers the downsides of a cash-less, sci-fi world of debit and credit cards: they are easily hacked.


Hacking or skimming credit and debit cards is nothing new. episodes in Florida, and Utah involving gas stations with skimmers installed, the twist being that they had Bluetooth transmitters, more high powered than consumer devices, allowing criminals parked blocks away to collect the data on credit and debit cards, and use the data to fraudulently skim accounts. The scam was perpetrated, because there are only two major manufacturers of gas pumps in the US, and both have standard master keys that open all pumps built by that manufacturer.

Stuxnet is a problem for US infrastructure, obviously the same weapon used against (perhaps) the Iranians can be used against us. Stuxnet spread by infected USB drives, exploiting previously unknown Windows vulnerabilities, and spread throughout the local networks, looking for Siemens industrial controllers and issuing sabotaging commands. Stuxnet was found in Iran, Indonesia, and India, the source infection being shipments of Chinese manufactured USB flash drives, and using forged digital security certificates from Taiwanese manufacturers. The same attack could be used, of course, against US utilities, nuclear power plants, and the like. But more significantly, against the US electronic payment system.

Most people today rarely use cash in purchases. Shopping at the grocery store, paying for gas, and all sorts of daily life activities generally involve credit or debit cards. Cash is harder to carry around, more vulnerable to street robberies, and by its nature imposes stricter spending limits (if you pay by cash only, you cannot buy more than what cash you carry). Checks are becoming a rarity, something written out to pay bills sent in the mail (and even that is declining as online payments proliferate), and not much else.

But the system is vulnerable. External facing security is fairly robust, since ATMs were introduced, banks have done a reasonably good job at limiting the damage criminals can do on their network, by using dedicated network connections, massive amounts of encryption, and imposing limits on withdrawals. Bank payment systems are also robust, sharing the same, dedicated networks, encryption, automated verification, and auditing and analysis to spot intrusions and fraud. Far less robust, is the internal systems. Or more succinctly, once you are inside various bank internal systems, there is far less security. Most of it is oriented towards preventing employee fraud and theft. Not outside intruders.

Stuxnet was thought to have required about six months full-time, dedicated work by a team of six top-notch programmers. At a nominal wage of $150,000 a year per programmer, that works out to about $450,000 to create Stuxnet, outside of other costs. Such costs are well within organized crime rings, particularly those operating in Russia and Asia. The US financial payment systems must look like a very tempting target. Obviously, help from a former or current employee at one of the major electronic clearing/payment systems banks would be needed, but that is relatively straightforward. Organized crime is good at finding people like that. Current internal systems would need to be carefully studied for weaknesses inherent in system designs and trade-offs in the engineering (security vs. usability). No doubt banks are yanking out USB ports even now from internal systems, but a network is as vulnerable as its most vulnerable connection. Other equipment required for the network is vulnerable in the manner that Iranian, Indonesian,and Indian power plants were vulnerable, to equipment from reputable manufacturers that would not at first blush contain malware or viruses. Cisco routers, or firewall, or other network equipment, would come to mind.

It is shocking, however, to see how widespread the use of Microsoft Windows, really has become in the banking industry. Just see how your local bank uses them. You'd expect with Stuxnet, banks would see the danger, and rip out Windows in favor of something else, with a more robust security model. But human nature is what it is, security is not a profit center, and so little money is spent on it. Overestimation of the efficacy of external security makes institutions complacent, as they've spent considerable sums on it. All of which is useless when it is bypassed by malware hidden in something from a legitimate manufacturer.

Nobody thought to check the USB drives because the idea that they would be infected with malware from the factory, even though that was the case. Network equipment from global manufacturers, and the like would be targets as well. Since most of them use common components sourced and assembled in China, it is a matter of mass-infection, and stealth operation, until some trigger is reached. Once inside, the Stuxnet modeled malware can be used to skim accounts and so on. The amounts could be staggering, and so large that banks would be tempted to pass on the cost in one way or another to retail customers. Even if the cost is simply a government bail-out, that itself will be passed onto customers. Swipe card network components, are another target of course. While security is tight, Organized Crime networks specializing in cyber crime and flush with cash are undoubtedly targeting the whole swipe card network system now, at the time of this writing.

Which brings us to the next issue. Will the cost of Organized Crime networks so compromise the safety and cost of the current electronic banking system that it can no longer function in the way that it does today? And if so, how will people operate? ATMs, and the networks they depend on, including the whole swipe cards, depend on both security and low costs. If the networks are compromised, both security and low costs will be gone. The advantage banks have had is that there were relatively few gifted electronics and computer science people, and those that existed were well compensated and solidly middle class. Since the early 1960's, the advantage of banks and payment companies has been that they had most of the truly gifted people, and criminal organizations did not.

The explosion of learning, and technical knowledge, particularly in a globalized workforce, means there are literally millions of people, often with profoundly non-middle class ideas, beliefs, and backgrounds, who are also technically astute or even gifted, in electronics and computer science. There now exists, globally, available to global Organized Crime networks, people who are at least the equal, of the men who create security networks for banks and electronic payment companies. Not the least of which are the layoffs prevalent in much of the electronics and computer science industry, and the ethos of youth over experience. This resource has already been utilized.

Zeus malware is continually updated and auctioned to lower-tier crime rings at $1,500 a transaction. Of course, for criminal rings operating outside the US or US-friendly jurisdictions (principally Russia and China), the risk of e-mail phishing scams and the like is relatively low, and the payoff fairly unattractive if not lucrative. But the big target is of course, the entire retail payment system itself. A ring that could penetrate and exploit, comprehensively, that system, would not reap millions. At the minimum, such an exploit would net billions, if not trillions, of dollars to any ring audacious and determined enough to get such an advantage. Particularly if measures were taken along the lines of Stuxnet, to cover the tracks of the creators and the recipients of the transfers. Such as massive chaos, erasing transaction records, and the like. Presumably, after the money has been sent abroad. A key component would of course be sending the money out of the country to places where the Organized Crime ring can use it. The money is no good unless they can get at it. Formidable problems to be sure, but not insurmountable given the extraordinary rewards. Indeed, the nexus of political objectives by hostile regimes and Organized Crime speak for themselves. Considerable resources are available to crack this problem, and eventually it will be cracked.

But what then? How will people react? If their payment network is compromised? Indeed if online transactions and swipe-card systems alike are unreliable, insecure, and high cost (because merchants run the substantial risk of non-payment and fraud), people will stop using them. It has happened before. Confederate bank-notes had little value as the war progressed, as prospects for victory grew remote and Union counterfeiting increased. In Britain, during the Dark Ages, usage of coins essentially ceased from the early 400's until the reign of Alfred the Great. Indeed, gold and silver coins, passed from common usage into oblivion, fairly rapidly, in the Twentieth century, except for collecting. Dollar coins themselves, common in the 19th Century, are now considered a bother by many. So too, usage of cash has declined significantly for common payment except for small items. When you are in line at the grocery store checkout, or at the gas station, you will rarely see people paying cash.

Yet before the ATM was introduced widely in the 1970's, and the widespread use of Credit Cards in the mid 1960's, cash was king. As it had been since 700 BC in Lydia, when the first coins came into use. Coins, either precious or made of ordinary base metals (copper, zinc, etc.), have a long history of being used globally as a means of trade. More recently, a few trusted paper currencies have been used, despite frequent counterfeiting, because of the massive amount of money in circulation and the general soundness of the currency. The US paper denominations being the best known but not the only currency in that category.

If electronic payment networks become so compromised that it is far too costly to use them, consumers will simply default to cash. Almost everything that can be done with electronic payment systems, either swipe cards or chips with various encryption (and Blu-Tooth) can be done with cash. Except of course, online payments in particular, Amazon and Itunes. Since a substantial amount of commerce depends on this electronic payment system, work-arounds will have to be rapidly constructed. One such would be partnerships with retail establishments for payment. An order "pending" until payment is made, in cash, at a fulfillment station. At grocery stores, or other places eager to partner with folks like Apple or Amazon.

Electronic payment systems have had a remarkably long run without serious interference from Organized Crime rings intent on extracting their own percentage. Inevitably, as skills spread out around the world, and the small cadre of solid middle class professionals that defends the system faces a massive army of people with matching skills and unbounded ambitions, that is likely to change. Particularly since those who have been most inspired by Stuxnet are not likely to be security professionals but those in the intersection of rogue states, terrorism, and crime. All that money to be stolen just begs for someone to try and steal it. Particularly since the world is now awash in the equivalent of electronic safe-crackers, and much of the safe components (electronic hardware) are manufactured in a few, fairly corruptable, Chinese factories.

So it is probably a matter of when, not if, all things considering. And not one event, but a series of events, propelled by the need to steal a lot of money. When that happens, cash will once again be king.
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The Tyranny of Free TV: Time-Warner's Jeff Bewkes Does Not Get It

In a series of interviews, Time-Warner's Jeff Bewkes declared TV is entering a new Golden Age, with its influence ever stronger on Western and indeed, global culture. Dismissing threats of cable cord cutting, and technological challenges from Amazon, Netflix, Apple, Google, and others, Bewkes declared that he saw limitless revenue from cable, decrying the "tyranny of free television." In "The Big Short," Michael Lewis portrayed chief executive after chief executive, who knew only vaguely what his company was doing, what risks it took on, for what rewards. This was true of Wall Street giants like Bear Sterns, to legendary insurance firms like AIG, to legendary clueless hedge fund manager Wing Chau, partnering with Merrill Lynch. None had a clue as to the real nature of the business they were dealing with. Jeff Bewkes promises to be Television's most legendary Wing Chau.


Because Time-Warner has the temporary whip hand over Itunes and Netflix, Bewkes assumes that no one can do what he did, go out and create content (as he did with HBO). In the interview at DeadlineHollywoodDaily.com, he said:

Bewkes argued that with TV shows such as Boardwalk Empire, which will come to UK Sky next year, TV is having its 2nd golden age. Partly this is because TV has kept pace with technology, from digital to HD to 3D. “We’re in the midst of a TV renaissance,” Bewkes tub-thumped. Bewkes singled out UK-originated shows such as Shameless, The Office, American Idol and X Factor as examples of quality TV. “The cultural impact of TV is now greater than movies. TV has become the most innovative medium in pop culture today. And it comes from increasing quality. Television is very healthy right now; TV is the only medium which has increased its audience apart from the internet.”

Given that 80% of Time Warner revenue comes from TV, Bewkes said he’d restructured the media giant as mainly a video programming business. “AOL was meant to take over everything,” Bewkes said, referring to AOL’s 2000 merger with Time Warner. “Unfortunately, it only took over us.”

Funny. Recent projections for 3-D TV adoptions have been re-adjusted, given the global consumer cut-back in discretionary purchasing. 3-D TVs promise to be less robust in sales, both in the US and globally, than Blu-Ray. Which itself is languishing as consumer's wallets are pinched. This is another Wing Chau moment, thinking that spending by consumers (or home-buyers) can go on forever. His view of quality TV, crummy reality junk from Britain, or un-funny "comedies" speaks for itself.

In a story from ABC News, Bewkes touted an initiative to allow cable subscribers to view content online, and claimed:

Jeff Bewkes said the number of television viewers was growing, paid-television penetration was increasing and advertising and subscription revenues were up. He urged the industry not to undervalue its content when making deals for digital distribution.

Bewkes of course believes that cable subscriptions are growing when in fact, they are already decreasing, a prospect Comcast acknowledged when they decided to buy NBCU instead of investing in their core business.

In an interview with the Financial Times, Bewkes said:

“We’re in the second or third year of a planetary global readjustment,” he says, yet TV subscription revenues, programming budgets and time spent watching TV rose through the recession. “Why? People love their TV. They love it on their TV screen and they love it on their new screens,” he argues.

TV’s golden age is no accident of history, he continues, but a consequence of a business model dating to the early days of HBO, the Time Warner-owned subscription channels operator where he made his name, and of previous waves of digital upheaval. “People act like it’s new. People say, ‘What’s going to happen when the digital world gets here?’ There’s this inappropriate comparison to the music business, where something happened to them when digital technology arrived on their shores that was akin to the Vikings landing,” he says.

Yet CNN and HBO were conceived about 30 years ago, where digital transmission and compression technologies first enabled multiple channels to be sent to millions of homes across the country for little cost.

Those advances led to the “vitality” of shows such as The Wire, Entourage or Curb Your Enthusiasm, he argues. “Back when you had the tyranny of free TV” – he repeats the phrase for emphasis – “The tyranny of free TV led to a monopoly of expression [and] the lowest common denominator of shows that could appeal to a mass audience.” [Emphasis Added]

As investors debate how many people will pay for video online, Mr Bewkes mocks those “grasping for some hazily conceived idea that somehow free TV on the internet will bring some sort of paradise to the people,” saying: “Well, it didn’t before.”

Bewkes doesn't get it. Indeed, he has no basic understanding, none at all, of his business. He's as clueless as Wing Chau. The Music Business was no more decimated by the advent of Itunes and Ipods than it was of 45 rpm singles, or 8 track tapes, or cassette tapes. The Music business was decimated not by "Vikings landing" but by crummy music no one wanted to buy in any great numbers. As the youth wave ended, and music and its consumers alike, aged out of pop music creation and consumption.

Let us be honest. The Wire, Entourage, and Curb Your Enthusiasm don't make money. HBO does not make money from ratings (it is advertiser free) or from the minor revenues via DVD sales and foreign sales. These shows are not "vital" since hardly anyone watches them. HBO makes money from subscriber fees. HBO is available to about nearly 100% of TV households, yet only 30% pay for it. That means, that 70% of households find HBO ... not worth the money to pay for it.

Bewkes (he started at HBO) does not even understand his own business. He sells snob-appeal, niche shows to upscale consumers, or those with tastes approximating those folks. But he does not charge Tiffany, Rolex, or Ferrari prices. Thus he's extraordinarily vulnerable to a prolonged recession making his cable channels irrelevant. While the Sopranos, Entourage, and the Wire get lots of press coverage, so does Gossip Girl. None of them get much in the way of viewers. He can't sell these things abroad, for premium prices, most nations have local content requirements, and subsidize local TV production even more than local movie production. Heck in emerging markets, simple piracy is always an option. Once a show is released on DVD, piracy is inevitable, particularly in places like China, and Russia, and India, where rule of law is regarded a quaint obsession of the West, and fairly weak and decadent besides.

The Wire, Entourage, Rome, and the rest exist only to entice HBO viewers to not cancel their subscriptions. It is not as if HBO is growing its subscriber base. Indeed, the "growth" in cable subscriptions are basically phantoms, people getting low deals to deal with the over-the-air conversion to digital, and then canceling them as the fees grow upwards. As detailed extensively here, consumers are finding that absent live sports, cable and satellite are entirely optional.

It is interesting how he phrases "the tyranny of free TV" as something harmful, and his own shows as the bastion of SWPL hipness, coolness, and all together with-it-ness. This is what happens when those who protest against the man, become the man. They become lame beyond belief, trapped by reflexive dislike of a mass culture they rebelled against, and became ... part of.

Jeff Bewkes is the head of Time-Warner. And he does not want to head a mass-audience media company. He is so tied in, emotionally, to the idea of being a hip, cutting edge rebel, he can't even see where the money is. If you want to know, in large part, why TV sucks so much, it is precisely because of men like Jeff Bewkes. Who have nothing but contempt for mass market.

Sure, the mass market can be dumb, if you make it that way. But most of what passes for "hip and edgy" on cable TV, particularly HBO, was lame ten years after it was first conceived, by the Romantics in the 1840's seeking to "shock the bourgeois." An artistic movement one hundred and seventy years old, is hardly cutting edge. It is, in fact, the establishment itself, irony of ironies. Shows like Rome, or Boardwark Empire, mostly seek to titillate their largely female audience with "taboo" sex and such. Exhibit A being "Tru Blood" and the scenes of violent, degrading sex popular among the female (and gay) audience for that show. Nothing has been more stupid, over the years, than the stuff Alan Ball has put on Showtime, from "Six Feet Under" to "Tru Blood." You could dub it, the tyranny of the hipster. Ultra-ironic, standing for nothing, except shocking ordinary people by how "transgressive" he is.

Stuff like "Supertrain," or "Pink Lady and Jeff," or even "BJ and the Bear" and "Sheriff Lobo," legendary bad TV shows, did not drip with contempt for the audience's basic values, and indeed lives. They may have been bad TV, but they were "honest" bad TV, trying at least to entertain the broad audience, not tell them their entire lives and beliefs were worthless. And mass market TV, at its best, far from being a tyranny, was liberating. Shows like the Rockford Files, or the A-Team, or Gunsmoke, or Miami Vice, were of generally high quality, created a common culture, and re-inforced critical cultural values of standing for what is right and good, even at cost, in ways both comic and serious. While never forgetting the main mission, to entertain the audience for an hour or so, never insulting them. Entertainment not by shock, but by well crafted stories with interesting, and likable characters, the audience wanted to see the next week.

Bewkes further touts his view that old content generating companies are still king:

The relative changes in technology and media companies’ market valuations suggest that investors are betting that value will shift from media owners to technology groups, but Mr Bewkes likens this “false premise” to arguments made in the dotcom bubble.

“There’s no reason why their interests and growth should come at the expense of the content industry,” he says, but the trick will be to marry TV’s “very happy business model” with the capabilities of new devices.

Bewkes does not get it. The threat is not 99 cents downloads of TV shows on Itunes. Anymore than the music industry was destroyed by that model. Sure, it erodes margins, on CDs/Albums and DVD boxed sets and the like. But that is just a marginal issue. If Napster, and indeed filesharing and the internet had never been created, the music industry would still be in terrible shape. Perhaps not quite as bad, but still very bad. Because fundamentally, people stopped being willing to pay for crummy music. They weren't 16 anymore. They already had lots of music. They did not need new music, that wasn't any good.

The threat, which investors are starting to see, is that mass media companies don't want to be in the business of mass media, and so make niche content for cable channels that few watch, and collect high carriage fees. All of it vulnerable to consumers canceling cable, and switching to other stuff. That "stuff" might be DVDs they already own. Or downloads and streaming video of new, more popular, broader content on Iphones, or Ipads, or netbooks, or Internet ready TVs, or boxes to connect your TV to the internet. It could even be the Nintendo Wii, or Sony PS3, or Microsoft XBox, and Halo, or what have you.

Anyone with cash can create content. Mass media companies face competition on the content front, because a company like Google can easily throw $3 billion in cash, at creating content, and already has its own distribution network. Called Youtube, and possibly also Android apps in their marketplace. Microsoft, Apple, and Nokia can do the same. Netflix, Redbox, and other players like Amazon also have cash, if less existing infrastructure, but that's a matter of servers in a data center, scaled up.

The traditional barrier to entry, in competing with big media companies, has been scale. You needed lots of cash, both to create content, and distribute it. For TV, it cost News Corp. about $1 billion over ten years to launch Fox Broadcasting. That would be chump change to Google, and they could launch an alternative to say, the CW network easily, online. Creative people are merely workers for hire. Few are locked in to long term exclusive contracts. You could hire, if you had the money, almost any TV actor looking for a new gig. The same is true for writers, directors, producers, and so on. And the scale for distribution of course, is already there. Itunes already acts as a defacto competitor to broadcast TV, along with Hulu.com, partly owned by Fox, ABC/Disney, and NBCU.

And there is money on the table. Lack of broad, mass market serial entertainment leaves a gap in the market. One that can be filled by a Microsoft, or Netflix, or whoever needs to create mass-market appeal to keep folks around their search engine site (Bing?) or provide the next level of entertainment offerings (Netflix). You no longer need to construct an expensive broadcast affiliate network, you can simply put servers in a bunch of data centers. Its far cheaper. Heck, I'm shocked Youtube has not launched its own "channel" of serialized entertainment with creators given fairly favorable terms to put up compelling, original content (i.e. bigger shares of advertising revenue).

Since this is exactly the kind of approach Microsoft used for gaining Windows popularity, and Apple the Iphone. Pushing favorable tools and terms to application developers, that in turn created content available nowhere else but that platform.


The danger Bewkes and the like represent (to their shareholders), is arrogance. It is arrogance that at its heart thinks their creative output, their tragically hip micro-shows, are worth far more than they are. I'd be the first to agree, the stuff Bewkes and the like put out, are not worth nothing. Surely Boardwalk Empires is worth something. But what Bewkes thinks its worth? Not a chance. So ends, in all likelihood, the tyranny of pay TV. It will die when the last hippie punches out the last tragic hipster.
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More TV Execs Not Getting It

The Financial Times has covered both the Jeff Zucker firing from NBC (totally expected) and the recent Goldman Sachs TV conference. In both cases, you have undeniable proof that TV execs just don't get it. They believe that their content is so superior, it will put them in the driver's seat, forever. When, the real risk they run is folks like Verizon, or T-Mobile, or Nokia, seeking to compete by offering their own content. Which seems inevitable.


The Goldman Sachs conference was covered here. CBS's Les Moonves called today a "new Golden Age."

Apple and Amazon are renting television shows, Netflix is streaming films, Google is launching a TV product, and millions of people are tuning into the iPad. Suddenly, it seems, technology companies are charting a new course for the media business.

Yet the captains of big television networks are expressing confidence that they still have the upper hand.

At the Goldman Sachs Communacopia conference in New York this week, executives from CBS, NBC Universal, News Corp, Time Warner, Viacom and Walt Disney fired shots across the bows of the technology companies seeking inroads into their territory.

In an unusual display of solidarity among competitors, the unanimous message was that they would be judicious about making their programming available online, and seek to extract full value from their TV shows and films. Content, it seems, is confident again.

“I feel better today than I did probably at any point in the past about the NBC broadcast network’s ability to survive,” said NBCU chief executive Jeff Zucker.

“This is really the golden age,” said CBS chief executive Les Moonves. “All the networks and cable have extraordinary shows, and the numbers are pretty extraordinary.”

Such confidence might seem out of place for an industry that is facing incursions from online video upstarts and saw US cable and satellite subscriber numbers fall in the second quarter of the year for the first time on record.

But the moguls said there was little evidence of widespread “cord-cutting”, the shorthand for consumers choosing to live without cable or satellite services. Bob Iger, chief executive of Disney, said he remained “bullish” on the television channel business “even in the face of aggregators like Apple, Netflix, Hulu, whoever”.
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Meanwhile, networks are looking to play the digital platforms off against each other, in part by offering different content to different distributors in different time “windows”. While each of the networks has made salvos online, they seem in no rush to make all their content available on any one platform.

“I don’t think an early entry is necessarily the greatest thing,” said Mr Moonves.

In their measured approach, the networks are seeking to avoid mistakes made by the record labels, which 10 years ago allowed Apple disproportionate influence over music pricing through iTunes.

“Our content is a scarce resource and we need to manage it intelligently,” said Chase Carey, chief operating officer of News Corp, which owns the Fox network.

All the big studios are dabbling in digital. News Corp and ABC have partnered with Apple to offer 99 cent rentals of TV shows, while CBS and NBCU have withheld their content for the time being. But even these positions are provisional. Mr Moonves said CBS would “accept their phone call” if Apple asked again next year, while Mr Carey called Fox’s Apple deal “a short-term test”.

Mr Moonves, who had kept CBS content off Hulu, an advertising-supported site financed by and populated with content from NBC, Fox and Disney’s ABC network, also indicated that its new subscription service, Hulu Plus, “makes a lot more sense to us”.

With no dominant online platform having emerged, content for now is fragmented online, and may remain so for three to five years, executives estimated.

“The digital space isn’t going to get all shaken out and defined by Christmas,” Mr Carey noted.

In the meantime, Disney’s Mr Iger said that no one digital platform seems likely to amass enough power to dictate terms to content owners. “It’s a much more complicated world,” said Mr Zucker.

Scatter pricing fees, last minute spot rates, are up 15-17% from last year. Retransmission/carriage fees (ala cable) are also increasing, reports the Financial Times. But the execs at the conference are dead wrong. Verizon CEO Ivan Seidenberg says cutting the cord is real. He notes that being a dumb pipe is a losing proposition. Cable fees are expensive, even HBO long ago realized that to keep their market share (they are available in nearly 100% of US households, but only 30% of US households pay for the service), the channel had to have compelling content found only on HBO. Me-too copying "television being the sincerest form of imitation" ala Fred Allen, would not cut it with consumers even in the go-go 1990's and early 2000's. Consumers can save considerable amounts of money, by canceling cable or satellite. Only Pro and College football likely keeps the cable or satellite cord from being cut. Audiences for such things as Project Runway, or even Jersey Shore, are niche by definition. Its not such compelling, serialized content that people will pay to consume it. Nothing like say, the power of Dickens stories that had longshoremen shouting at ships tying up at dock for the latest news of his characters. Yes spot ads are up, slightly, from last year's debacle. Organic, sustainable growth that is not.

Being a dumb pipe, like say Amazon or Apple are now, is fine if your core expertise and revenue lie elsewhere. For Amazon, it is being the number one retailer on the web, building on both its recommendation system and its "stores" (basically providing e-Bay like service for mini-sellers) to offer the most convenient, and "safe" web retailing service. For Apple, most of their revenues still come from hardware, mostly the Iphone and Ipods, then laptop computers. Itunes is a growing revenue stream, but relatively small compared to other parts of Apple's revenues. For both of these companies, being a winning aggregator is fine, they are not lean and hungry enough to venture into content creation, though their considerable cash reserves allow them to do so if they wish.

It is other companies, sitting on a lot of cash or struggling to break out of "dump pipe" status, that are threats to TV studios and networks. Netflix has already started exploring creating its own content, as HBO did years ago. Verizon could do the same, so could T-Mobile, or AT&T. All three mobile networks offer mere service (AT&T's monopoly on the Iphone is likely to be broken soon) that is at its core, a commodity. Having the exclusive content, available only on their network, is a way to make people keep re-subscribing, and tolerate higher fees.

Microsoft is hungry too, failing to find much success out of its core Windows and Office monopolies. Making Bing into more than just search, offering exclusive, subscriber only content, is one way for them to grab market share away from Google. Which in turn has struggled to find profitability from YouTube. YouTube under Google has experimented with the Tribeca Film Festival on pay-per view movies of films in the festival. Offering original serialized content is one way to make the huge bet Google has invested in YouTube pay off. Since user-supplied video of guys crashing into a wall on skateboards has not been very profitable. As mentioned in the prior post, Nokia is lean and hungry. The company will never beat Apple's lead in apps, nor even approach Google's Android operating system and its own app store. Original Content available only on Nokia's phones and partner service providers is one way to win.

And really, what's the barrier to creating content? Cash. Nokia, Verizon, T-Mobile, Google, Microsoft, they all have a lot of it, still. HBO was able to commission its own content, and its just a smallish cable operation (admittedly part of Time-Warner, but that can hurt as much as help given the Byzantine politics inside Time-Warner). Soundstages in LA, and globally, are for rent. So too, casting directors, writers, agents, producers, cinematographers, skilled crew members, actors, and so on. The infrastructure to make serialized, TV-style entertainment is global. Anyone with the cash can make it, pretty much anywhere.


The comments from fired NBC head Jeff Zucker are pretty telling.

Mr Zucker began his career at NBC 25 years ago, quickly rising from researcher to produce the Today Show at the age of 26. As chief executive, however, he has faced criticism for his management of NBC’s entertainment properties, notably after a failed attempt to shake up its core broadcast network’s prime-time schedule.

He was mocked, sometimes by comedians on his own payroll, for the reshuffling of Jay Leno and Conan O’Brien, and the jury is still out on the scripted programming that now fills the evening schedule.

By contrast, cable properties such as USA Network and Bravo grew strongly and Mr Immelt sang Mr Zucker’s praises. “He has always stepped up when the company needed him. He never blinked when it came to tough decisions.”

Mr Zucker said: “I think I was creative and innovative. I think I took a lot of risk, I put diversity on the agenda and I created a culture of co-operation and collaboration I’m incredibly proud of. I do wish this had been a simpler time.”

He added: “I turned this into a hell of a cable network company and expanded internationally and digitally and dealt with a cost stucture in an economically challenging time.”

The man started at Ground Zero for female-oriented PC: the Today Show. He brought the same, female-oriented perspective (Average White guys suck!) to his NBC job, and drove the network into last place. His legacy is more, female-oriented, Average White Guys suck! content including "Undercovers" and "Outsourced" (i.e. isn't it funny Americans lost their jobs to Indians in India!). While the latter has held on (in the premiere) to most of the Office's lead in, so too did 30 Rock and Parks and Recreation, comedies in the mode of NBC's Thursday night line-up (i.e. not very funny, or popular). NBC still dominates the night, but gets fractions of what it got in the late 1990's with Friends and Seinfeld.

Zucker's legacy is lack of any compelling content. NBC has nothing really, that tens of millions of people, or more, will tune in week after week just to see. The characters and situations are as boring a self-consciously "hip" Malibu lecture on the need to save the Whales or polar bears delivered from a beach side, $10 million mansion. Nothing Zucker created really stands out, as compelling, can't-miss TV.

Leaving his network (and the rest as well) hideously vulnerable to whoever can provide a sports and entertainment package that beats the current offerings, on price, and emotional content. Very little on either cable or broadcast network is so compelling people even care to see it live or on tape.

Someday very soon, a "dumb pipe" will transform itself to a place for exclusive content, seen only on that pipe. It won't be broadcast TV or cable, neither have a clue. And the change will wipe them out just as the lack of compelling content wiped out the music business.
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FX, Terriers, and Men: Why Cable is Being Replaced (and How)

FX's new cable series, "Terriers," is doing poorly, while NBC's "Outsourced" has garnered acceptable ratings in its initial debut. In part, this is because of schedule, "Outsourced" follows "the Office" which is a hit, such as it goes, for NBC, and "Terriers" has significant flaws. But the overall numbers strongly suggest that Television, both broadcast and cable, are in the midst of a transformation, one in which serial entertainment is delivered by phone, or Ipod, and consumed individually. This has significant implications, not the least of which is new entries into content creation: Neftlix, Amazon, Redbox, and possibly Apple, are moving into content creation. Not just to control costs and create broader, more appealing content that addresses the under-served portion of the audience: men. But because Hollywood just cannot create cheap, good, and male-appealing content, that also appeals to women (the pot of gold, cross-gender appeal). After pursuing "niche" for more than forty years, Hollywood is soaking in it. Which is why, slowly but surely, the major new buyers of entertainment, like Netflix, are sure to create their own content.


Verizon CEO Ivan Seidenberg recently said that cutting the cable cord is a real phenomena.

“Young people are pretty smart. They’re not going to pay for something they don’t need to,” he said. “Over the top is going to be a pretty big issue for cable.”

But that’s an issue for Verizon (VZ), too, right? Seidenberg’s company sells its own version of the cable bundle, via its Fios service, and it has 3.5 million customers. And Seidenberg noted that the TV bundle isn’t going away immediately. But it will, he said.

“We take the over the top issue with video very seriously,” he said. “I think cable has some life left in its model…but that it is going to get disintermediated over the next several years.”

Seidenberg’s argument is that over the top is a much bigger deal for cable guys like Comcast (CMCSA), who have an entire business built around the bundle, than it will be for his company, which is a relative newcomer to video. Theoretically, he’ll be be able to replace some video subscribers with subs who pay for robust broadband connections. But like it or not, it’s going to happen, he says.

“I’ve seen the movie. If you remain static too long, the technology is going to nibble at you on the edges, and you have to be prepared for it.”

For now, sports like ESPN broadcasts of college and pro football games, baseball games, basketball, etc. are about all that is keeping men subscribing. Most cable channels and all broadcast networks are completely oriented towards women. It is not, of course, just Lifetime Network. As pointed out in the post "How Female Oriented is TV?" from data collected by site TVbyTheNumbers.com (an excellent site and well worth your time), last spring in broadcast TV, only the Simpsons, Family Guy, the Cleveland Show, and Chuck were strongly male-skewing, in that order, with Fringe and 24 slightly male skewing. Broadcast TV, and cable, is a vast, female-gay ghetto. Full of "hunky" men who women can "change" and taboo-breaking scenes, etc. that excite the female audience.

But long-term, this gay-female ghetto offers little revenue growth and significant challenges by new technology, as Seidenberg notes. On the broadcast side, audiences continue to erode. Men have largely fled, "Two and a Half Men" is as noted by TVByTheNumbers.com, a female-skewing show. The White female audience is not growing, Blacks are too few in number and mostly too poor (Blacks are 12.5% of the population, and about 60% of them are urban core / ghetto) to be a profitable growth market. [The over-representation of Blacks in commercials is to signal PC adherence to diversity for Liberal White women, which is most White women, and to get Jessie Jackson and Maxine Waters off commercial makers backs, as well as promoting the Platonic "noble lie" about the socio-economic characteristics of Blacks.] Mexicans, as shown consistently by Nielsen (here), with skeptics on this point invited to click the link and see what Hispanics in the US watch.

Meanwhile, cable faces younger audiences (and old) cutting the cable cord and simply relying on Hulu, Redbox, Amazon, Itunes, and so on for entertainment, with local news and such provided by over-the-air broadcasts. Continued recession, and likely decades long wage pressure and limited job growth pretty much guarantee consumers will penny-pinch for decades to come. Older audiences finding "hip and edgy" not cutting the value equation, are likely to cut cable as a discretionary expense no longer justified, as much as younger ones. Indeed, it is likely pressured families as much as "hip/cool young consumers" (the business world has a pathetic need to appear hip and cool) who would seem to be cutting cable first.

Already Verizon and Sprint offer some streaming of games through phones. Flo TV gives live, mobile TV in portable devices, offering "no streaming, no waiting, no buffering." ESPN offers, as does the NFL, limited coverage of games on their website, via streaming video. These are baby steps, akin to the Creative Labs Rio and other early, pre-Ipod MP3 players. Eventually, some company will get this right, offering a cheap phone or player device, with low monthly fees. Making it cheap, convenient, and easy to watch video on a pocket sized device. Clearly this is where music has gone, from expensive, custom hi-fi set ups in the 1970's to now, cheap/tinny MP3 players offering massive convenience at the expense of quality sound. In the modern world, people seem to prefer convenience, over quality.

Cable is extraordinarily vulnerable to this shift, and Comcast's purchase of NBC can be seen as either extraordinarily stupid, or a desire to hedge the exposure (of being dumped as a "dumb pipe" delivering content for cheaper/better alternatives) by getting into the content creation business. If so, that move may yet prove foolish, as NBC has shown no real ability to create and sustain winning content, that appeals to both men and women. "Outsourced" may do OK ratings after the Office, but it does not seem something that would be a winner in the new scale required by a shift to personal video consumption. In that new world, scale matters. Winners would be defined, because of the cheapness inherent in the pricing model (inherited from MP3 downloads and already established by Amazon's video on demand, and Netflix's offerings), by massive popularity. While production costs can be whittled down, there's only so cheap a production can get before audiences tune out. This means a world of low-margin, high volume entertainment. Something Hollywood just can't do. Particularly TV.

FX has tried to rebrand itself as male-oriented. Ads for "Two and a Half Men" (itself female-skewing) stress male-orientation. FX's lineup includes "Sons of Anarchy," "Terriers," "Its Always Sunny in Philadelphia," "the League," "Two and a Half Men" (re-runs), and "Lights Out" (in January, about a boxer). FX has been around since 1994. Recently, MediaLife published a story on FX.

With “The Shield,” which begins its final season in September, and “Nip/Tuck,” plus movies like “Batman Begins,” FX in only a few years has gone from a nondescript network to becoming the closest thing to HBO on basic cable.

“They have some great, great cutting-edge, gritty shows that have become appointment viewing for millions of people,” says Brad Adgate, senior vice president and corporate research director at Horizon Media.
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Another big plus: The diversity of that programming makes FX a top-five network in virtually every demographic advertisers care about, putting it on par with broadcast TV in another important regard.
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The other challenge facing FX may prove thornier. The network must deal with the failure of many of its newer series to perform up to the level of "The Shield” and “Nip/Tuck." FX will debut one new drama this September but it's also bringing back three of its newer dramas, “Damages,” the Glenn Close series, "The Riches," and "Dirt," and none has fulfilled their critical promise in the ratings.

What makes it such a thorny challenge is that FX can't air just any new series. It has to be edgy, pushing the limits, and it also has to be a substantial drama. There just aren't that many scripts that meet those high standards. In a sense, being like HBO, FX shares HBO's programming challenge--one that has hobbled the pay network for several years.

FX’s tagline for advertisers is “There is No Box,” meaning it’s not confined to any demographic group or any particular genre.

That’s to say it's an edgy network airing original series and movies that you’d sooner find on pay TV than on cable or broadcast TV.

“The whole strategy of originals, which goes back to ‘The Shield,’ is to bring people in by providing fare they can’t get anywhere else,” says Lefkowitz.

FX’s target is adults 18-49, but its originals zero in on a variety of demographics. It targets men with the firefighter drama “Rescue Me,” women with “Damages,” and younger adults with the comedy “It’s Always Sunny in Philadelphia.”

FX ranks among the top five cable networks in the 18-34, 18-49 and 25-54 demographics.

Its average primetime audience in February was 1.5 million viewers, up 26 percent from February 2007. Among 18-49s, FX ranked No. 4 behind USA, TBS and TNT with 875,000 viewers, up 28 percent.
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FX’s appeal to advertisers is its big ratings and broad demographic reach, notably with edgy programs that build loyalty among viewers. It's among the strongest brands on cable.

But the network faces a real challenge in keeping itself fresh with yet more edgy shows that draw viewers, as the “The Shield” has done, without going so edgy and dark that advertisers shy away.

Edgy and hip of course being code-words for female and gay oriented entertainment. Men like action, and adventure. None of which is particularly edgy and hip. Think "Die Hard," or "Star Wars," or even the Star Trek movies. "Death Wish," the Dirty Harry movies, and the current Jason Statham action movies, are not edgy and hip. Nor are they "dark." They're filled with … action. Which is what draws in the male audience. "Damages," "Dirt," and "the Riches" were of course, female skewing (Dirt and the Riches were not renewed).

Meanwhile, the numbers for FX itself are not particularly compelling.

How often does a scripted series hit an all-time ratings high in Season 6? Well, FX's comedy It’s Always Sunny in Philadelphia just did it with its sixth season premiere last night. Also breaking series records was the network's comedy The League, which opened its second season behind Sunny. At 10 PM, Sunny delivered 1.83 million adults 18-49 and 1.46 million adults 18-34, up 3% from the previous series demo highs posted by last season's premiere. In the male demographics, the gains from the Season 5 premiere were bigger, 16% in Men 18-34 (1.01 million) and 11% in Men 18-49 (1.24 million), both all-time series highs. The total viewership, 2.21 million, was was off by 1% in Live+same day but is expected to be a series best when Live+7 data is factored in.

Or, translated into English, "It's Always Sunny in Philadelphia" had 1.01 million men watching it and 450,000 women, ages 18-34, and 1.24 million men, and 590,000 women, ages 18-49. Of the core advertising group, this adds up to about 1.83 million (ages 18-49).

Terriers ratings were even worse, about half a million people watching. Comments on TVByTheNumbers.com included:

I dont think Terriers ratings are bad because it's a bad show but because its on a network whos audience isn't really into that type of show. Justified debuted big but then dropped a lot when people saw it was a procedural type show. FX built its brand off adult serialized dramas and i think thats what its audience expects. It would probably be a hit on TNT.
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Unfortunately, there doesn’t seem to be a wide audience available for the ‘PI’ genre. (Somebody wake the Mike Hammer folks up.) We saw this with Veronica Mars, and other than that show and Angel name the last PI show outside of Magnum that lasted longer than a wasted breath? (Bored to Death , Monk, and Psych aren't true gumshoe shows. They are dramedies.) I could argue that this is the wrong time to launch a new show on cable. What with all the broadcast nets pimping their wares, but who gives a hoot. I think it would've done a lot better with an early summer run. (Y'know when there's little competition.) It’s no longer a question of ‘if’, now it’s a question of whether or not the fans get to see all of it before the ax claims another victim.

Terriers, for those who saw it (about half a million people), has some major problems. Only Donal Logue ("Life," "Tao of Steve") is a compelling actor who holds your attention. Co-star Michael Raymond-James does not really register (he played "Tex" on an episode of "Life" and was also on "Tru Blood"). Nor does his character hold much interest, a blue collar crook persuaded by Logue's "Hank Dolworth" to mostly ride the straight and narrow as an unlicensed PI. The female characters remain ciphers, mostly uninteresting. Though its implied the character Britt Pollack (Raymond-James) pulls his hot girlfriend mostly on the basis of his outlaw status, the writing and performance don't indicate raw charisma. While the main description of the show, as two down and out private eyes seeking to slowly adopt responsibility and maturity, has male appeal, that theme seems a turn-off for women. Who prefer men already "hot" (i.e. high status, charisma, dangerous) and merely need their magic guiding hand and uber-sexual appeal to "change him." I.E. make him commit to one women, the female proxy character.

This is not the only "magic formula" and by itself does not guarantee success, but does seem to describe those shows with substantial audiences (nearly all female) absent gross-out, one-liner animated comedies and semi-action/sci-fi dramas, that appeal more to men. Terriers leaves men slightly intrigued, but not enough to stick around, and FX is still, mostly a female-driven audience. Hip and edgy being dead give-aways. The fruitless pining by the lead character for his ex-wife, soon to be married, seems a pointless turn-off for men, who did tune in the next day in far greater numbers (about twice the amount as Terriers total viewers) for "Sunny in Philadelphia," which is basically a more explicit Seinfeld. There seems to be a lack of action-adventure to draw in a male audience, itself a tough sell on cable even on FX (the network being mostly female oriented), and not enough "hunky guy you can change" for women. Add a lack of really compelling writing, particularly in creating compelling supporting characters, and Donal Logue can't carry the show by himself. The lead characters demons (alcoholism and a life of crime, respectively), are interesting to a female audience if the guys are "hot" Alpha males. Not so much when they're blue collar, down and out, scrapping for change. Meanwhile, guys don't see much action, adventure, or the lead characters winning. But the main problem remains lack of compelling characters (and the lack luster performance by the other actors). TV (or, serial entertainment) requires a magnetic, compelling presence by most of the cast. Aside from Logue, that's just not there in Terriers. But the problem is not confined to just one show. FX itself is trapped.

FX's problem is that their audience base is about 1.5 to 2 million viewers, tops. That's not very much. Basically, FX makes its money from carriage fees (what satellite and cable providers get charged for carrying the channel, regardless of who watches). As noted above, that money is under significant pressure from a variety of sources, and is one big shift away, from collapsing like music sales. Nokia right now, is under huge pressure. The company just hired its first non-Finn as CEO. It has no real advantage in the lucrative, high-end smartphone market, being tied to the Symbian OS with significant short-comings, including apps. The way out for a company like Nokia, seeking to challenge Apple or Google in apps, is entertainment content. Some folks at Deadline Hollywood Daily got it.

stevenp is absolutely right. These numbers are nothing to harp about and yet everyone does. It’s a calculated decision to tout these numbers for the advertisers and no one else. The issue is most of the scripted shows are mediocre at best and non-scripted is often so cheap, it doesn’t matter what numbers they do as long as audience flow is established so a channel can maintain its carriage. Reality at FX is they continue to make shows for very narrow niche audiences and although their success has been spotty, the value of the channel continues to grow due to perception. The question I have is when does cable stop cuming [he means cumulative adding] numbers and own up to its real sampling? If they did, the reality of these kinds of numbers for the cost of the programming should give one pause. But Sunny benefits from a contained budget and a ridiculous guarantee from MRC and ownership for FX productions that makes it impossible not to make and you see it again with The League which I’m sure gets made under the low budget FX model. The bath on Terriers and Justified and Damages and Dirt and The Riches is a much more important thing to look at and gage. But it’s irrelevant because the perception of the channel is in place and therefore the overall value of the asset to Newscorp is really all anyone at Fox cares about. So much for quality programming.

This commenter gets it. Cable is not delivering numbers, in proportion to the hype. Indeed, I would suggest that if you added up all the cumulative numbers of both Broadcast and Cable, it would not come close to the TV watching of say, 1968 or even 1975, when there were only three networks, plus spotty PBS, but entertainment was much broader. Emphasis on niche content inevitably drives those not enamored of out of the marketplace. There is a whole mass of under-served groups, particularly men and older audiences, who don't find hip, cool, edgy, and dark entertainment particularly appealing. And don't watch.

The problem is, that Netflix (whose CEO recently insulted Americans by calling them "self-absorbed" and implied they were stupid, on price, regarding his Canadian pilot to sell streaming video at cheaper prices than US plans), and Redbox, and Amazon, and Itunes/Apple, are all spending billions of dollars to carry content that is not making them much money. It is my view that one hungry player, will spend less, by creating their own content, deliberately engineered to be as broad as possible, reaching all four "quadrants" (young/old, male/female), to make themselves a come-from-behind player. Offering a cheap handset/player, priced less than $200 (the disposable income marker these days) and very cheap monthly rates (probably less than $10 a month).

Nokia, or Samsung, or even Motorola could be a player in this. All are under earnings pressure. Verizon, or T-Mobile, or other mobile service providers could use this to get "tie-in" and increase their earnings (by getting people to switch and stay). Obviously, technical issues such as bandwidth, compression, and reliability of service need to be addressed, but they are not insurmountable. The goal is to move video one-way only, and deliver that video onto a fairly small screen (Hi-Def need not be delivered in the first generation). So people can view video pretty much anywhere. Just like listening to an Ipod. Indeed, serialized entertainment, available ONLY through such a service, perhaps downloadable at first, could prompt switchers if the entertainment was broad enough. Men of course, form the majority of technology early adopters, so are a prime target, but women would have to find the entertainment desirable as well, given their robust participation (about half) in the technology consumption marketplace, for organic growth after an initial adoption.

The initial problem, though, is not technology but content. Hollywood has been in its own niche of dark, hip, edgy, and cool (read, female and gay) that its not really capable anymore of making broadly appealing content. Serialized entertainment, like most TV series, are a natural for personal consumption. Because unlike a movie, its not "one and done," audiences want to see lengthy development of characters, situations, and action to enhance their pleasure. If a movie is like a short story, TV is like a series of novels. Where about 17 hours, for the average hour-long drama (about 43 minutes per episode when commercials are subtracted out) that runs 22 full episodes, compared to about 2 hours maximum, allows far greater detail to be presented to the viewer, in action, drama, character development, and simple quirkiness. It is this advantage of time, that at its best, makes television superior to movies. Capable of covering either drama or comedy in far greater depth, and more carefully, than even the most skilled team can deliver in two hours.


Companies like Netflix, or Amazon, or T-Mobile, or Nokia, or Verizon, or Redbox, or Apple, or Samsung, all seeking first-mover advantage to have the complete system, cheap, fast, and good, are stuck in dilemma. They pay a lot for Hollywood content, which just isn't that compelling. Inevitably, one or more of these companies will start creating their own content. By tapping some of the more lean and hungry creative teams, definitely not including the Wachowskis, who are currently making a movie about a gay US soldier and gay Iraqi terrorist plotting to kill Bush. That's Arianna Huffington in the middle. The Wachowskis look like extras from "the Hills Have Eyes," and certainly cannot be accused of even having a remote understanding of what mainstream America finds entertaining. The one sibling as you can see has had the full sex change operation.

Likely to be tapped are those folks who attempted, but failed, in making broad-based entertainment (because TV is now such a female-gay ghetto that men have fled it for good). Rand Ravich and Far Shariat ("Life") come to mind, as the sort of model content creators approached. Folks who know how to run shows, budgets, and make male-appealing stuff that can also have appeal to women. With an offering of non-Hollywood accounting, i.e. full profit sharing on "first dollar revenues" as long as costs are kept down, with perhaps increases in percentages if consumption goes up (i.e. the shows are sold on a per-download basis, or streaming sign up, etc). Creating direct and unmistakable incentives to make the content as popular as possible. Going for people hungry for money, and willing to trade awards, "respect," and critical acclaim to get it. Young Andrew Lloyd Webers, in other words. Folks who will take critical disdain in exchange for making a a lot of money.

It is pretty clear that the current model of cable offers little possibility of change, caught in Hollywood's Hip and Edgy Trap. Which offers critical acclaim, career advancement, and plays to the desire of execs in cable and broadcast to win publicity and coverage, not audiences, for their shows. Since even in broadcast, and definitely in cable, masses of viewers don't translate into revenue. Indeed, broadcast TV is increasingly resembling movies, where a few massively profitable shows (sports, American Idol) and a few thinly profitable shows (cheap reality) subsidize money-losing "prestige" shows.

The new model (not a certainty, but a probability at least) offers canny first-movers the ability to escape the trap, use their own custom-built content, to draw subscribers/customers to a new model. One of mass, not niche appeal.

Which overall, would be good for the country. By having to appeal to male audiences, which are generally more culturally conservative than female-gay ones, the constant drift ever leftward (for example the norming of polygamy) can be arrested, at least for a while. And a common culture, among men and women, offers a way for each to have greater understanding of each other. Something the isolated culture of today provides little support for, and indeed constantly undermines.

It would be ironic indeed, if a great mass of people a short time in the future, watching videos of serial entertainment, alone and individually, on small portable screens, were more connected via mass-appealing media, than the collective viewing of TV today in living rooms and sports bars today. The world of Max Headroom is today, only instead of only Network 23, there are thousand choices, all the same, all very niche. Let us hope for a broader, more unifying tomorrow.
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