Relevant and even prescient commentary on news, politics and the economy.

Netflix Toasts Itself

I was going to write something about Reed Hastings’s inane email, but Wired covered the main point, even if they did bury the lede:

However, it’s impossible to see how the split itself benefits customers. The price and plan changes that flustered many of them months ago remain in place, but the company now directs them to two web sites with two search indexes, two completely separate sets of recommendations, two entries on their credit card statements, and so forth.

When Erik Loomis (now known as the sane political blogger at LG&M) noted the issues with Netflix splitting the company way back in July, there were some objections from the Twitterati that his post didn’t address any of the reasons Netflix had to make the change,* apparently ignoring that markets have to have both a buyer and a seller to function. As “Divorced One Like Bush” recently noted, there are business strategies you can use, and there are business strategies that work against you.

But rarely does one see a company deliberately opt for a business strategy that works against them.**

*One of the more prominent of those is now staunchly defending the company’s latest CF, but did have the decency to quote a respondent: “I admire the umbrage your taking on behalf of netflix and their ungrateful customers.”

**Well, maybe not so rarely, but at least Tyco management made no secret that it was determined to enrich itself at the expense of the companies it acquired and is now spinning off.

cross-posted from Skippy, the Bush Kangaroo

Atlas Shrugs: The musical or other scary variations

by Mike Kimel
Cross posted at the Presimetrics blog.

The inimitable TBogg has a clip from the upcoming movie Atlas Shrugs, Part 1. The book is so long and so interminable that the movie has to be done in three pieces.

The clip has to be seen – words don’t do it justice. And while at TBogg’s there – read the comments readers left behind. Some of them are hilarious. In any case, the clip apparently inspired TBogg to search out more information, and he located an interview with John Aglialoro, the producer of the movie:

6. Have you decided how you’ll tackle John Galt’s epic speech in part three?
Well, I’m looking at a number of different things. Having John Galt give that speech, it might be in a casino environment. It might be that he is at a mountain retreat, rather than being where he is captured, not…that violent scene at the end. But we’re going to take a look. It doesn’t have to copy just that.

No, it absolutely will be a concentrate of entertaining words with a total, philosophic…But, you know, part three could be a musical…like a Les Miserables kind of a musical. That’s part of the impact and I guess I haven’t said this publicly yet, but I’m looking at it completely different if part three is a musical with quality music that’s done in a certain way that people will like. I mean, if you saw the play Les Miserable without the music, and then with the music, you may go in there saying, ‘oh hell, I would never want to see that great book in a musical.’ That’s going to shock a lot of people to see part three be a musical, and part two may be very different from part three and very different from part one. It has to be new, you know…We get a freshness, a vitality about it, and yet it has the same, rock-solid principles and philosophies that we all know and love.

Which apparently provided TBogg with further inspiration – in a later post he tries to write out some music for part 3:

I am the very model of a modern major industrialist
You people call me selfish, but I prefer ‘objectivist”
The looters and the moochers, they try to take what’s mine
To share my genius with others, I’m afraid I must decline

I’m very well acquainted, too, with things that should be taxable
But I will not pay my fair share and on this I am intractable
Push me just a bit too far and I’ll head to Gulch of Galt
Your world will start to fall apart and it will be your fault

Your world will start to fall apart and it will be your fault
He’s packing up his bags and he’s going to Gulch of Galt
You people are annoying and it’s harshing his gestalt

The rest of the song is just as good and worth a trip to TBogg’s place to read in full.

Pull Quote of the Day: The Police Know The Truth

From Constance Ash’s discussion of Capitalism: A Love Story:

There are some scenes that that must have been shot around the period when enraged screwed-over people gathered at the New York Stock Exchange yelling, “Jump! Jump! Jump!” Moore has said in an interview, that while at the NYSE the NY cops came up to him and the crew. He told them “Hey guys, we’re just here to film a little comedy and we won’t be long,” thinking they were going to run him and crew off. The cops responded, “Mike, these bastards took a billion and a half dollars out of our police retirement fund so you just take your time.” [emphasis mine]

The real damage is known, and yet to come. Can we start us the term “jobless, pensionless recovery,” or do we have to wait until Justin Fox realizes it?

And Here I Thought Corporations were Rational

Ken Houghton lowers the level of discourse at AB by discussing the career of a porn star other than Adam West.

One of the primary tenets of economic theory is that corporations believe in nothing other than profits. Well, it’s not quite that stark—we use phrases such as “utility maximization,” “cost minimization,” and the like—but the basic idea is that corporations, even more than individuals (silly humans!), have as their sole target maximizing profits.

So I’m a bit confused by the Vancouver Sun’s poorly-edited* obituary for Marilyn Chambers.

Let’s put the timeline together:

  1. Chambers “began her onscreen career as an Ivory Snow detergent model.”
  2. Chambers made Behind the Green Door, released in 1972.
  3. The movie “prompted a run on boxes of Ivory Snow, which featured a photo of Chambers.”

    So far I follow this: actress tries a different role, reaches a whole new audience, and sales of her previous works soar. (Think Kristin Chenoweth going from Broadway to television. Or maybe not.) What I don’t understand is the reaction:

  4. [T]he scandal produced “a Marilyn Chambers clause in all modeling contracts, saying that you can never have posed topless or nude or been in any kind of adult film or Playboy or anything like that.”

Let’s review. MKarilyn Chambers (h/t Tony C.) causes a major spike in sales of Ivory Snow detergent. Better yet, some of those people probably aren’t even going to open the box, so they’re going to have to buy another detergent as well—and, even time they have to go shopping, they’re going to see that Ivory Snow detergent and, if they need detergent, they’ll have an identification with it.

UPDATE: Robert, in comments, notes that this may be a rational act, if we assume normal market segmentation and a lack of loyalty on the part of the spurt of buying.

I believe this is what economists refer to as a “win-win” situation.

So why would the result be a “business decision” specifically banning the possibility of developing such cross-marketing potential in the future?

*I say poorly edited because on things such as that the last sentence of paragraph three is “The L.A. County coroner is examining the cause of death, but a spokesman said foul play is not suspected.” and the closing of paragraph four is “The cause of death is under investigation but foul play was not suspected and an autopsy is pending,” which strikes as the equivalent of giving the reader a sense of deja vu through stereotomy glasses.

How Much Should I Spend to See a Movie? (In which I channel McMegan)

While the brood was at Mary Poppins, I took advantage of the Academy Awards rules and went to see Revolutionary Road. The incremental cost was subway fare (arguably a sunk cost, since I have old Metro cards) and the $12.50 NYC film ticket price.

So that was quite rationalisable; met up with an old friend and spent a relatively pleasant couple of hours. (Saw the movie too.)

On the other hand, Defiance opens December 31st. At the Ziegfeld. And that one I can’t not take Shira to see.

So it’s either: spend US$18 for train fare (two r-t) and US$8 possible subway fare (walk slightly over a mile, with timming issues), and ticket price (presumably US$25), and get a babysitter to cover the minimum five hours (and probably more) this hegira would take.

Not to mention how one values ten to twelve person-hours of time with much to get done.

Or wait until it opens on 16 January, and be able to pay C$ (which might still be an advantage then), but not get to see it at The Ziegfeld.

Matching Obsessions

It is no secret that the only movie I’m waiting to see this year is Quantum of Solace, even if they did have the poor taste not to use Janelle.

Well, Paul McAuley saw it more than two weeks ago, and confirmed it is everything viewers of the recent Casino Royale would expect.

So far this wouldn’t fit on an economics blog. But see the comments to the movie:

I’m somewhat boggled by the concept of a secret international organisation corrupting third-world countries for profit when the World Banks does a perfectly good job of that already…

to which the only possible response was:

This is a super-secret world bank – but yes, their methods are somewhat similar.

Wonder if Dani Rodrik would agree. On a possibly-related note:

Consider this an open thread discussing international development and “aid.”