One of the nasty side-effects of a market “maturing” is that the large companies that shape the market will use their installed base as leverage to try to split the market so that they can dominate the split part more thoroughly. It’s a gamble: they hope they can pull customers from the other “side” and lock them in. I’m sure that capitalists have some explanation how this makes a market more efficient, but I suspect they’re talking about making the market more efficient for the vendors, and not better for the customers.
I see this behavior all the time, and I loathe it: it makes things more complicated and less good for the customer. Vendor A wants to divide the market with Vendor B, so they agree to disagree on a certain point of technology, and now their customers have to pick “sides.” It’s complete bullshit, to the customer, of course.
When Netflix first started, I subscribed and began building a moderately huge personal archive of media. It was nice: I could find just about any DVD that had been published. But slowly, over the last few years, Netflix decided to get into the movie business, as did other companies that used to be in the media distribution business, and they started not carrying eachother’s stuff. Last year, I realized that Netflix was useless – if I wanted to find a particular movie, I had to search through a variety of options: Amazon, Netflix, Hulu, Youtube – and see which one had which partnership with the distributor of the movie. Is this supposed to somehow make my movie-watching experience better? Of course not: it magnifies the number of vendors that have my personal information and can sell it to marketing weasels for targeted advertising. None of this serves the customer at all.
Make better movies, you jerks
Another example: I’ve been an avid gamer since I first encountered computer games in 1972 at the Johns Hopkins University summer fair; someone from the CS department had a DEC PDP-1 running “spacewar” and I fell in love. Fast forward to the 1980s I worked for DEC, which was one of the great computer companies of the time. DEC and its near competitors (Sun, HP, Sequent, Gould, Silicon Graphics, Convex, Pyramid, etc) engaged in a scorched-earth market-dividing orgy of competition that resulted in Microsoft and Intel being the last option standing. This competition was intended for the computer vendors to shake out the market and see who dominated it – none of it did anything for the customers. In fact, a lot of customers wound up with unsupported hardware made by a company that lost out in the wars. In the meantime, customers were also treated with rafts of features that didn’t make anything better; they distinguished the vendor in the market. In other words: they divided it and made it more complicated and less reliable.
I was already sensitized by this, so when I started seeing gaming console companies dividing the market through “exclusives” I was immediately wary. If you wanted Metal Gear Solid you had to buy a Playstation from Sony and if you wanted Halo you had to buy an Xbox from Microsoft. Some of the game manufacturers produced the same game for both platforms and gamers could see the differences between the platforms: negligible. Sure, there are always “True Believers” in one platform or another, but the situation entirely serves the vendors. It even makes games more expensive since developers now have to code to multi-platform APIs so that, as soon as their “partnership” agreements expire they can make the software available on other platforms. It’s not just the basic graphic and network APIs: the different platform vendors have various micro-payment schemes that need to be adopted, as well as networking protocols, server farms, group-finding systems, and load-sharing. They also monetize the customers differently: do you have to join Playstation Plus to get certain game features? Does the game vendor get a kickback for the customers they bring, or are they expected to pay for the privilege of accessing the captive customer-base?
The ideology of capitalism is that this competition refines a market and makes it better. In fact, it makes it more complicated and worse: we “need” iOS and Android to masquerade as choice instead of customer lock-in. It does not result in a better phone, better apps, or cheaper or more reliable service – it results in two different completely incompatible stacks which anyone who wants to enter that market must navigate; and they pass the costs on the customers.
Of course, it’s true that if one vendor is able to take over a market, they will almost certainly screw it up. AT&T’s dominance of the US telephone system is why the US has a copper-based system that is inferior to European public utilities. They did not compete by making their system better – in fact, they mostly relied on dividing the market geographically, and lying. We’re about to see the same dynamic play itself out again with 5G wireless roll-out: the vendors are realizing that if they call any old thing “5G” they can peel customers that don’t know better from their competitors. In the meantime, we wind up with the same situation we have had for decades: you get great service if your provider has a deal with the dominant local provider – customers get parceled and packaged and swapped between vendors like trading cards.
Amazingly, customers keep falling for this. Remember when Google were the “good guys” and were coasting on their reputation for providing decent zero-cost services that severely undercut other players in those markets? Remember when Google tried to compete with Facebook by dividing some of the social media landscape with “Google+”? If a social media platform is so fucking necessary to society, why isn’t there one that is ubiquitous, which does not suck, and which does not sell its customers as tokens to advertisers?
Comparison of exclusive games [source]
Am I the only person that this bothers? It seems to me that so many people are happy with the endless rivers of bad software, security holes, and marketing bullshit. Don’t they realize that things could, and should, be so much better? But as long as we feed the system as it exists, it will continue to exist; they’ll keep doing the same old tricks because the tricks have worked so well for so long.
I’m curious: does anyone have some good pro-capitalism ideology for how lock-in makes a market better?
Back around 1999, I realized that standardization only emerges in a market after all the technological life has been sucked out of it – there’s no more money to be made by being incompatible. It’s only then that the big vendors will explore intercompatibility and standards. Or, once one vendor has conclusively lost the battle (see Beta vs VHS)
Sure, but they’re lying through their teeth. Capitalists hate efficient markets (when that term is used in its standard economic sense) because efficient markets minimize profit. Pretty much everything you’ve described in your entire post is intended to reduce economic efficiency.
Your game console example (where the console hardware is, at least at the beginning of the cycle, highly subsidized) reminded me of a related problem: complaints about price discrimination for products with high fixed and low marginal costs. Sure, lots of people hate the idea that they paid twice what the person sitting in the next seat over in the airplane did for the same flight, or that they see different prices from others when they go to amazon.com, and saying that price discrimination is bad sounds good there. But then you remember that a lot of South-east Asian folks can afford textbooks only because Pearson sells them for a quarter the U.S. price in India, making Americans subsidize the Indians’ share of the fixed costs. (Not that they do it out of the goodness of their hearts.)
It’s funny but I feel the same way about television/cable/satellite/etc. Meanwhile TV shows have more advertising on them, and the show does not last as long. So I said forget it, I’m not paying for that. If they start sending ME a check every month to watch all the advertising, I might consider it. Otherwise, forget it.
I agree about phones too. My phone does all kinds of crap I’m not interested in, so I don’t use those features, but it sure was a good excuse to crank up the price for it.
It’s almost like… corporations are super greedy and don’t care about whether or not they are serving their customer base. Now if only there were some sort of, I don’t know, governing body or something to regulate the unfettered greed…
I feel like almost every defense of capitalism relies on a model of a small village of craftspeople. Oh, and also insisting that people are rational (we’re not), and well informed (again, we’re not).
And it seems like the best defense of capitalism a lot of people can come up with is to point at some corrupt, failed economy, and yell “COMMUNISM!”
I used Hulu until they killed the “free” option, and then I started using Netflix. There’s enough on there that it will take me a while to work through the list of stuff I want to see, and I’m loathe to pay for another service when I haven’t exhausted the current one. It’s too bad, since I’d really like to see some stuff on other services, like Preacher, The Runaways, American Gods, etc. I wonder if any of those will ever come out on DVD, or if they will be streaming only.
Nope you are not the only one it bothers, it bothers and annoys me, because of the position of power it gives the dominant platforms. For instance I signed up to Facebook using a nym as while there were people I wanted to keep in contact with I didn’t want any of my old friends contacting me, the friendships that weren’t current all slid for a reason. Someone reported me for using a nym and bang, I’m off Facebook with the only option for return to use my ‘real’ name and to prove it’s my name by sending them my passport, not even a copy of my passport, my actual passport. Well fuck that, I’m not going to trust my passport to a company like Facebook quite apart from the fact that I didn’t want to use my ‘real’ name, and actually as most of the people I was keeping in contact with had been on a defunct forum they didn’t even know me by my real name. I was Jazzlet to them, Jazz for short, the ones I know in the flesh even call me Jazz, and in the UK at least if you are not using it for criminal purposes an AKA is perfectly legal, so where does Facebook get the right to insist I use my ‘real’ name when the nym is just as real? Now as it happened I realised that being off Fb was good for me, so I dropped it, but there are people for whom using their ‘real’ name would be dangerous, would Fb insist on seeing the court order against a woman’s violent ex or dangerous stalker? Yet I have lost conact with some people who I very much liked, all because Fb has that unfettered power. Now that’s a personal story, but they can and do ban perfectly legitimate groups that are working on things that improve society, supporting vulnerable people of all kinds etc etc etc while allowing groups that are dangerous to go on posting crap that at the worst gets people killed, I think that’s a real and dangerous problem.
That’s one part of the problem you are talking about, which covers far more like the effective monopolies on particular products etc etc etc, point is there are all sorts of ways these situations disadvantage the consumer, starting with money and going right on up to their lives.
No, you aren’t the only one. It bothers me too. Hmm, should I leave it at that or should I rant about this topic? I guess I might as well do the latter, considering that I have a free evening.
Consider light modifiers for studio strobes. Every damn manufacturer has to use their own mount. There’s Elinchrom, Alienbee/Balcar, Hensel, S-mount/Bowens, Profoto, Broncolor, etc. mounts. For some reason I cannot put any manufacturer’s reflector or softbox on any other manufacturer’s strobe. It’s annoying as hell.
Personally, I’m stuck with S-mount/Bowens, because I’m using cheap Chinese lights (Godox brand). This mount sucks, it’s flimsy. I know damn well that human engineers could make a lot better system for attaching a softbox to a studio strobe. But, no, they won’t do that and make it a standard.
And, no, camera gear manufacturers aren’t earning more of my money by limiting which mount I can use. The only thing they have achieved is pissing me off and forcing me to buy an adapter. I have no brand loyalty for photo gear. I use stuff from lots of different brands.
On top of that, I don’t even see the whole point of having various mounts, when even the big brands like Broncolor or Elinchrom are offering speedrings that enable their light modifiers to be used on any other brand’s strobes. Is the whole point of having various mounts simply to force photographers to buy multiple speedrings for a single softbox? Then again, considering how big brands charge up to $100 for a single speedring, selling lots of speedrings might actually make sense from a business perspective.
You know, being as cynical as I am, I’m actually surprised that light stands are exempt from this trend and I can use any brand’s light stand to support any other brand’s strobes. Isn’t it a miracle that a photographer can buy an Elinchrom light stand and put a Profoto monolight on top of it without having a need for any adapters?
Tripods, on the other hand, don’t always do so well. Theoretically, there’s an industry standard, namely most tripod manufacturers use Arca-Swiss style plates in order to attach the camera to the ballhead. Except when some manufacturers decide not to do that (I’m looking at you, Manfrotto). The first time I bought a tripod, I didn’t know any better and got a Manfrotto one. Ouch. Of course, now I’m using another brand’s ballhead that’s compatible with an Arca-Swiss style plate.
And then there’s also the sad fact that if camera manufacturers wanted to, they could make their lenses truly interchangeable. Phase detection autofocus accuracy might be tricky to get right, but as long as photographers were willing to stick to manual focus, interchangeable lenses would be as simple as agreeing to use a single mount. After all, there already are photographers who use Nikon lenses on Canon cameras with adapters (not the other way around, though). There are also photographers who use vintage lenses with adapters. There are even brands like Sigma and Zeiss who make lenses for all the cameras out there. It could be done.
This is just so sad and frustrating.
I’m glad that I’m not into computer games and I don’t watch movies often. Thus those examples you mentioned in this blog post are irrelevant for me.
E-books, on the other hand, do bother me a lot. Amazon Kindle, Kobo, Barnes & Noble Nook, etc. all try to force people who own their e-readers to also buy e-books from their own store. Fuck them all. Instead I’m using an e-reader from a Chinese company (Onyx Boox). The thing I love most about this device is that it supports all imagine e-book file formats, it doesn’t tie me to any e-book store, and it has no DRM. Just because American/European companies might want to manipulate and artificially limit my e-book purchasing options doesn’t mean that I will allow them to do so.
One more thing—it’s nice that pirate sites have all the stuff anyway. All the e-books, all the movies, everything is there for people to just download. There’s no market fragmentation, no DRM, no artificial limitations. When legal stores that sell digital files act like assholes, it sure stops people from feeling guilty about pirating stuff.
Jazzlet @#4
Yeah, the real name question bothers me a lot too. I don’t like my legal name, because it’s a female name.* Unfortunately, in Latvia I cannot change my legal name, because Latvian laws suck. This leaves me with two options: (1) use my legal name online even though I don’t like it and it clashes with my gender identity; (2) use a different name and face certain other problems. I don’t like either of these options.
Whenever I use my legal name, I try to remind myself that it doesn’t matter how I call myself—a name is just a meaningless label that doesn’t define who I am. It’s just a meaningless string of sounds. I shouldn’t care about it. Yet the problem remains that to some extent I do care, I don’t see myself as female, and thus I also don’t want to be forced to call myself in a female name.
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* Actually there’s one more reason why I don’t like my legal name—people who are unfamiliar with Latvian language seem unwilling to believe that a name can have two vowels in a row, in this case ie. Thus a lot of people assume that my name must be Leva instead of Ieva. It’s tiresome to correct people all the time.
Ieva
As I did, sorry again. Though the font here does not distinguish between an uppercase ‘I’ and a lowercase ‘l’, which doesn’t help.
Also ‘yes’ to the lack of lens etc. compatability, yet another area of irritation.
Still bitter about the UNIX wars?
Jazzlet @#7
You or anybody else among people who comment here misreading my name didn’t bother me much. If somebody online misreads my name, it makes no real difference for me. As I said, I try to deal with having a legal name that I dislike by not caring about it. I don’t have to care about my name online.
People mistyping my name bothers me only when it actually matters. For example, when I applied to study in a German university, they wrote my name as “Leva.” On that occasion I wasted two hours of my time until I got university employees to correct the spelling of my name in their computer system.
Then there’s also the fact that Latvian post employees aren’t legally allowed to give my any packages unless the name in my passport matches what’s written on the package. (Yes, I really have to show my passport to a post worker in order to get a package.) On one occasion people from an online store where I ordered some stuff wrote my name incorrectly on the package, and that delayed me getting the stuff I had bought, because I had to write to the customer service people from that online store, and I had to ask them to contact Latvian post workers and clarify who the recipient of this package was supposed to be.
Shorter sermon: Capitalism poisons everything. Judging by the comments you might be preaching to the choir, Marcus.
Anyway: Yes, it bothers me and it’s everywhere. Capitalism hijacks every system and usurps the original purpose by replacing it with money. Healthcare is supposed to get people healthy, instead you get price-gouging on one end and corner-cutting on the other to bolster profits. Or take cars, a big topic in the EU right now: The technology is supposed to become more sustainable, “green” and whatnot. Instead you get lies, excuses and, if you’re the consumer, stuck with the bill while the liars and cheats pocket the profits.* [Fourhundred million sevenhundred thousand twohundred and ninetysix addiitional examples were omitted for brevity]
That’s why I frequently catch myself thinking, [example of critical infrastructure or service] should primarily be run/regulated by the state so it works cheaply and efficiently. Then I have to remind myself that efficiency and cost-effectiveness are often the last thing state-run operations achieve. They tend to either fall to plain old corrruption and cronyism or someone decides that it isn’t working and should be thrown back into the free market where it sinks like a stone.
“Efficient markets” are nowhere to be seen. I assume they’re just a metaphorical paradise from some holy economics text not meant to be taken literally. A few passages to comfort those who don’t get to play the game but are, as you put it, mere tokens in it.
*Getting to keep the illicit profits must be a core principle of capitalism. Maybe that’s what the “free” in “free market” refers to: The token fine and zero jail time served when you’re found out.
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Re: Ieva Skrebele (#6):
Indeed. [Obligatory XKCD] Piracy isn’t solely about money or robbing poor megacorps of their hard-earned cash, often it’s about convenience and reliability. Large movie sites, game platforms etc. seem to be doing their damndest to make doing business with them as inconvenient as possible. “Like this game? Then you’ll love being hamstrung by an installer platform that does absolutely nothing for you but throw ads at you. If the platform breaks or your connection goes down you’re screwed.” – “Thank you for purchasing our service. Now before we get started, here are some ads we think you’d enjoy.”*
Anyone who decided to change their business model to actually serve their customers would probably be both a lot more popular (assuming they can cope with the market splitting issue) and have a lot fewer problems with their products being pirated.
*Ad1: Thing you googled yesterday.
Ad2: Same thing since you looked at it on Amazon
Ad3: Same thing again, even though you already bought it and it lasts a lifetime.
Ad4: Ad for Thong, because of a typo you made during your first search
Targeted advertising, truly revolutionary.
@Ieva, it ain’t just the lens mounts, it’s also the battery thing! Why oh why does each of the 4 cameras I own need a different battery and a different charger?
And, on the topic of batteries, I think that is the biggest drawback to an electric vehicle fleet. Cahrging takes too long for those who travel long distances. A standard battery is needed for all electric cars, these can then de dropped and swapped at charging stations in about the same time it takes to fill a car’s gas tank.
Reckon the efficient market will do that?
komarov @#10
My experience, living in Europe, is that, despite all the corruption, state-ran critical infrastructure and services work better and are cheaper than privately owned ones. I went to a state owned school and university, I get my medical care in a state owned hospital. And, yes, privately owned alternatives do exist in Latvia, it’s just that they are worse and cost more. For example, when it comes to universities, state owned ones are where you go to get education; privately owned ones are where you go when you need the services of a quasi diploma mill. Another example: in past I could buy electricity from only one state owned company, but now I can buy electricity in the free market; the day when the switch happened, electricity prices jumped up a lot.
Yes. While I was living in Germany, I didn’t pirate anything at all. I didn’t need to, and I wasn’t even tempted to do so. I’m not interested in games or movies anyway, so books constitute the only digital content I need. My university’s library was amazing, and they had books on every subject I was interested in reading about. On top of that, I could also buy books cheaply. In Germany, I could buy online used books for as little €0.1 and pay around €2 for shipping. Paying a couple of euros for a used book was affordable for me, so I bought many.
Unfortunately, in Latvia it’s a whole different story. Latvian libraries suck. All of them. Even the larger ones. The official government policy is that Latvian libraries must store a copy of every single book ever published in Latvian language. Unfortunately, there are only two million people who speak Latvian language. As you can imagine, books that are actually worth reading are never translated into Latvian. Bestsellers like Harry Potter or Twilight do get translated into Latvian, but nobody will translate academic books, as there are too few people interested in reading those. The end result is that Latvian libraries have very few books that I might be interested in reading. Of course, Latvian libraries have very few books in foreign languages.
Of course, I can still buy books online. In theory. In practice it’s more complicated. According to European book sellers, Latvia is the middle of nowhere. Many don’t even ship books to Latvia. Those who do shit them, charge high shipping fees, usually it’s around €10 for shipping. At this price point I’m no longer so happy to buy books online, even if I can find cheap used books from sellers who are willing to send them to Latvia.
Of course, e-books always cost the same regardless of where I live. Unfortunately, the pesky little problem is that e-books are often more expensive than a used paperback copy of the same book. On top of that, e-book sellers also tend to annoy me with DRM and all sorts of other crap.
The bottom line: when you live in the middle of nowhere, piracy is pretty damn tempting.
Oh, and I forgot to even mention income discrepancies. If you live in, for example, Germany your salary is going to be several times higher than if you live in a place like Latvia. A €30 price tag for a single book looks totally different for somebody who only earns €600 per month compared to another person who earns €4000 per month.
People who comment here are certainly not a representative sample of the entire human population, instead we are a self-selected group with specific interests. That being said, judging from comments here, we all are just as concerned as you about this problem. My suspicion is that a lot of people are bothered by this problem. It’s not that people don’t realize what’s going on or don’t care, instead we keep on “feeding the system” only because there is no other choice. We want to have access to certain goods (be it games, or movies, or e-books, or photography equipment), and all the sellers who offer those things for sale engage in all the nasty business practices. Thus there is no choice. More precisely, the “choice” is rather limited: (1) buy from the sellers you despise; or (2) don’t buy anything at all and live without the goods you want to have.
The closest thing to an efficient or perfect market is racecourse betting. There the same information is available to every customer (punter), prices are clearly displayed and the prices are set by the market. The more demand for Horse A, the lower its price, the less demand for Horse B, the higher its price.
And yet, with all that information available, “the market” is only correct about one third of the time, with favourites winning 1 in 3 races.
DRM is not a problem. I borrow ebooks from my library, they use Adobe software that “expires” the loan in 21 days. Calibre and Apprentice Alf’s DDRM is all I need to keep forever.
Hear, hear! Excellent analysis.
As an avid anime watcher/collector, I’ve run into this on two fronts. Where most anime could once be viewed on Crunchyroll, in the last few years everyone is getting into the act, so that you need a subscription to Crunchy, Funimation, Sentai, Hulu, Amazon Prime, and Netflix to see the same content. Unless you watch on illegal aggregators or otherwise pirate.
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As to the piracy, I just read where Samsung and Oppo will no longer make BluRay players for the US market, and others are bound to follow suit. Which will make people dependent on streaming. And that is problematic because streaming licenses expire and then you can’t watch them anywhere, except aggregator sites or your own pirated files. Likewise DVDs are already being discontinued, leaving only BluRay, with soon limited options for upgrading from DVD players if you haven’t already got one. On top of that, several Japanese companies have decided to try to cut out the middleman of US distributors and sell BDs here themselves, at vastly inflated prices, so if you can’t budget $300 – $500 for one series, piracy is your only option to ensure permanent access.
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Anime music is a whole other ball of licensing wax. You can buy some things on iTunes (with DRM and the possibility of it vaporizing), but a lot of tracks can only be legally obtained through iTunes if you live in Japan or use a VPN to spoof that (there may be even more to getting around it, so that they don’t flag an international payment). Why they’ve made it nearly impossible to legitimately buy music by Japanese artists is beyond me.
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Then there is the problem of region codes for DVD and BluRay. This means that some titles licensed in the UK or Australia but not here means I can’t buy them unless I get a region free player or somehow disable region blocking on the one I have (and I don’t know how to do that, and fear completely fragging the software if I try).
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Caveat: all of these complaints are from a North American pov. International consumers face a whole host of other roadblocks to legal consumption of anime due to region blocking of streams. None of this benefits consumers, and I’m not entirely sure it benefits the producers and distributors either. It seems to be as much about “you’re not the boss of me” dick-waving as it is maximizing profits.
Ridana @#16
Wow, I had no idea that for people living outside of Japan it’s so hard to get digital files created by Japanese artists. When the thing you are selling is a digital file (be it music or video), it makes no sense to charge different prices based on where the customer happens to live. It’s already annoying that all the prices have to end with …9.99, and that somehow always results in prices getting higher in that region where I happen to live, but what you described goes way beyond that.
And it all sounds stupid. I cannot imagine how it could increase profits, because if things are as bad as you describe, I wonder why anybody would even try to buy legally instead of simply pirating whatever anime or soundtrack they want.
Speaking of things costing more in some regions than others, electronics and digital camera markets have the same problem. I never buy any electronics from Latvian stores, because their prices are ridiculous. It’s a lot cheaper to buy from abroad and have my stuff delivered to me by mail. For example, two of my Canon lenses are from a German online store, my digital camera is parallel aka grey import (sold by a UK store). Only my Sigma lens was bought from a Latvian seller, but that was a seller who was importing grey market goods directly from Asia. Go, capitalism! Considering how many electronics manufacturers don’t even have a Latvian service center (apparently Latvia is too small to warrant having a service center), I’m not really loosing anything by buying my stuff from abroad. If I needed warranty repairs, my electronics would have to get boxed and travel to some other country either way.
@Ieva (#17): Region restrictions are stupid, but also hard to fix. And as I mentioned in my first post above (and as you touched on in your explanation of the wealth differences between Latvia and Germany), in the interests of fairness often it does make sense to charge different prices depending on where the consumer lives. Why should an average consumer in one country have to pay 5% of his monthly salary for a book whereas an average consumer in another country pays only 1% of his monthly salary for the same book, when the marginal cost of the book is far less than either?
komarov writes (#10)
Not true. There are plenty of equity and commodity futures and options markets (NYSE, CME, the KRX where a program I wrote traded KOSPI options) that are quite efficient. These efficient markets also tend to be the most heavily regulated (with even more self-regulation than government regulation) with very strict rules explicitly designed to prevent traders from making them less efficient. (Basically, the opposite of the “free markets” that certain people demand.)
Roj Blake writes (#14):
I think you’re misinterpreting there what the market there is saying. The favourites should win every race only where the odds are zero that any other horse should win. But if over a series of races the favourite is 3:1 to win in each and the favourite’s not losing a third of the time, you know something is wrong.
Curt Sampson@#18
Fairness? Yeah right!
It goes the other way around. Living in Latvia, I purchased my Canon EOS 5DS R digital camera from a UK store and had it shipped to me, because in UK stores this camera model was significantly cheaper than in Latvian stores. The average salary in UK is higher than in Latvia. Simultaneously, electronics in UK stores are cheaper than in Latvian stores. How is that supposed to be fair? And it’s not just electronics. Getting some book in Latvia is a lot more expensive than obtaining the same book in UK.
I’d be happy if, living in Latvia, I could obtain books for the same price as what Americans or British pay for their books.
I remain unconvinced by the arguments mentioned in the article you linked to.
Yet that’s exactly what’s happening. On my bookshelf, I have books printed in the USA, in the UK, in Germany, in France, etc. There are plenty of American, British, etc. online bookstores that are perfectly willing to put a book in a box and ship it to Latvia. If an American bookstore is willing to ship a physical copy of some book from USA to Latvia, I’m pretty damn certain that they would be also willing to ship the same book to the UK or Australia. Regardless of where some book is published, there are countless online bookstores willing to ship it to anywhere in the world. (Being a polyglot, I have purchased books in online bookstores from a lot of countries.)
I buy all my books online and pick them up from local post workers, so this just sounds silly for me. All it takes for a bookstore to sell books internationally is to set up a website and get lots of cardboard boxes for shipping the books they have sold. I use an online price comparison tool for finding the cheapest copy of whatever book I’m interested in, which has resulted in me buying books from all sorts of online stores. I don’t give damn about some store’s branding, imprint, and corporate connections; instead whether I will buy a book from them depends on two facts: (1) do they offer shipping to Latvia; (2) how much they charge for the book.
On top of all that, there’s also the fact that nowadays lots of books are printed in China, and shipped to other continents afterwards. So, no, I don’t buy the necessity to keep markets separated even for physical books, never mind digital e-book files. Incidentally, whenever I bough e-books online, all the stores selling them were perfectly willing to accept my Latvian credit card. Nobody seemed to be bothered that a customer with a Latvian credit card was buying an e-book that was intended for some other market (DRM can be circumvented.)
Ilya, you’re smarter than this. Surely you understand the idea of marginal cost, and so understand why your EOS 5DS R example is something completely different from what I was talking about. And you also surely understand that you are buying books in foreign territories and getting them shipped to you, rather than buying them in your territory, and how different sales would be if you told the entire population of the U.K., “you can’t buy it in local bookstores, so set up an account on Amazon.com, buy it there and get it shipped to you.”
You are lucky due to the particulars of the geography and wealth of your country. Come to Japan and use a Japanese credit card and billing address and you’ll find that there are many American places selling digital content that won’t sell to you. In fact, I’d guess that you even have the same barriers and just haven’t seen them. Have you tried using your Latvian billing address and credit card to add credit to a U.S. region PlayStation Network account?
17 @ Ieva:
Here’s a good article about why it’s so hard to buy digital music (and other goods – most action figures listed for sale on Japanese sites say they’re for sale in Japan only, though most vendors usually still ship them anyway). Buying whole CDs isn’t much of a problem, other than the expense of buying and shipping music you didn’t want along with the track you did.
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The talent agencies have a ridiculous amount of control over everything. When the movie poster for live action Fullmetal Alchemist came out, apparently they had not kissed the right rings at the lead actor’s agency, so they had to edit out the title character from the posters, even though he’d been placed dead center in the photo!
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It seems that iTunes requires you to have an account in the country of the seller, so people apparently get around this by buying iTunes gift certificates to pay for their purchases, since it’s the foreign payment that flags the transaction.
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If they weren’t so stubborn, it seems to me that anime producers could compete with aggregator sites if they were willing to pool their resources and create their own aggregator sites, just like the pirates do. Japan is currently trying to pass a law to prohibit unauthorized uploads of images, ostensibly to combat manga piracy, but even manga authors are opposed to it.
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Btw, I wanted to add that some of what I said in my earlier post hasn’t yet come to pass – I can still buy all the BDs of nearly everything I want (again, not necessarily true for international viewers) and my BD player still works, though the titles I want most have never been licensed in North America other than streaming (ok, one of them was, but Viz mishandled the release so badly the first partial set didn’t sell, so they shelved the rest) – too niche, I guess, even though they keep ending up on annual best lists. Also Crunchyroll, and to an extent, Viz and Funimation, allows free streaming with ads, so you don’t have to buy subscriptions for them, you just need to be willing to wait a week after release.
Re: Ieva Skrebele (#12):
Okay, I was a bit too harsh in my judgement. However, it seems depressingly common that state-owned or social services can still be run poorly (or even into the ground) or adopt very strange practices that wouldn’t make sense for either a social or a competitive service.
The British NHS, for example, is the Health Service in the UK, which sounds just about perfect if you like the idea of single payer social health care. One is all you need. But it’s also famously underfunded and has had doomsayers predict its collapse for years now. I’m sure many here remember that “funding the NHS” was practically a cornerstone of the Leave campaign. It was one of the fastest evaporating lies told in service of Brexit. And apart from not getting any funding their personnel crisis seems to have worsened again thanks to the politics supposed to support it.
German health services, by contrast, are split into a myriad of private and social healthcare providers. The former are “proper” commercial entities and can, in theory, do their own thing. But with the latter people have been wondering, why are there so many social providers? They essentially offer the same services, yet they’re competing with one another for customers. In the process they create administrative and marketing overheads that, some people argue, are simply unecessary. That money could be spent on actual healthcare instead if only there were fewer providers. So there’s an example of what should be a social service that seems to happily squander resources on “free market”-things instead of their actual purpose. (Another issue: Apparently they often focus on the “most attractive” customers: Young people, who they seem to think are most easily swayed by offering current medical fads and stuff bordering on quackery. This may then be covered instead of services that might appeal to, say, older people. Noone wants to draw in old customers who just get sick and cost money. That’s rather more business-like and not all that social.)
komarov @#22
I never said that state funded services are perfect. I’m fully aware of the problems. Latvian medical care system has many of the same flaws you already mentioned. Underfunded? Check. Doctors competing for young and healthy patients? Check. Alternative treatments? Check; for example, when I was a child, my doctor used to prescribe me homeopathic medicine. My mother didn’t know any better that homeopathy was a placebo, so she paid money for homeopathic pills and gave me that crap. I could add more problems to the list, but there’s no point, I assume you can imagine it anyway.
That being said, while state funded services are far from perfect, they still tend to be better than what you get from “free market” capitalists. For example, USA has the most expensive healthcare system in the entire world, and it sucks.
Curt Sampson @#20
It sounds like you may have misunderstood my point, which means I must have done a poor job explaining it. I’ll try again. You said that it would be fair if people who live in poorer countries paid less for various goods (like books) compared to what people in rich countries have to pay for the same things. In theory, I can agree with this—it would be nice if richer people sponsored access to books for those who are poorer. In practice, this isn’t happening. There is no fairness, you cannot even begin to talk about fairness. Capitalists don’t care about fairness. In reality, whenever there are price differences, it goes the other way around—people who live in poorer countries have to pay more for imported goods.
I mentioned various examples (like books or digital cameras) in order to demonstrate that with various goods the trend still always goes in the same direction—it doesn’t matter whether I want to buy a book, or a digital camera, or a gaming console, because in all these cases I will have to pay more if I live in a poorer country like Latvia compared to what people pay in a richer country like Germany. I have lived in Germany, and a lot of goods (books, electronics, clothes) were cheaper there than in Latvia. (For the sake of completeness, I should also mention that it’s only imported goods that are more expensive in Latvia. Locally produced goods tend to be cheaper in Latvia.)
Of course, I understand the various different factors contributing to the fact that imported goods cost more in Latvia than in various other richer countries. With books it’s the same price plus higher shipping costs. With DSLRs it’s the smaller market—a photo equipment store that operates in a market with only two million people won’t have the economy of scale of a store that operates in a market with one hundred million people. I get all that. My point was that you cannot use “fairness” as an argument for why markets ought to be segregated, because under the current system people who earn less also have to pay more. There’s nothing fair about that.
There certainly is a difference from the seller’s perspective (where are their offices and warehouses located, in which country they are paying taxes). For me, as a customer, it makes no difference. Regardless of whether I order my books from a Latvian, German, American, or British online store, I will always pay with the same credit card and I will always get my books from the same local post office. For me the only difference is in how much shipping costs and how many days I have to wait for my books to arrive to me.
For e-books it would make hardly any difference, except for the fact that people would get rid of DRM and their banks would do some currency conversion with every purchase.
For physical books, at first there would be some chaos because of the increased demand for shipping services. Customers would also complain about longer shipping time and higher shipping costs. In the long term, once bookstores would be forced to get rid of all the problems in the system and sort out the logistics, there might actually be some nice improvements once both markets finally got merged together.
There really is no good reason for why American and British book markets ought to be separated. Nowadays lots of books are printed in China anyway. If you print some English language book in China, it’s only reasonable to ship some copies to the UK and some other copies to the USA. If I, as a non-native English speaker, could successfully learn both American and British English vocabulary and spelling rules, native speakers could do that as well.
Nope, I have never been interested in PlayStation. Nor have I ever wanted to buy Japanese anime soundtracks. So, yes, I’m willing to believe that, due to the kind of interests I have, I simply didn’t notice any problems.
Marcus, you’re entirely right. No company in their right mind would want an efficient market in their sector: they all want a big, and preferably growing, chunk of as an inefficient market as possible. Competition can cause markets to become more efficient, but the strategies you describe are a way to avoid competing. Content separation (i.e., exclusive distribution) is almost as good as geographical separation at avoiding competition. While nobody moved to get better long distance calls, and very few people move solely to get better cable, loyalties to TV series do change somewhat more easily — but they’re still deeply set. And, unlike geographical separation, it’s not even strictly either-or. Bonus!
Curt Sampson @ #18 mentions, among other things, standardized options as an example of an efficient market, but even there the exchanges have long fought tooth-and-nail to keep their exclusive listings, and have long resisted the conversion to electronic trading in the most lucrative products. In stock options, their efforts to make markets ostensibly more efficient for customers (funds and individual investors) have driven out most of the small market makers, and only large banks remain now. For a time, about a decade ago, the changes did reduce costs for customers, but once the many small market makers have gone, the costs have increased again. Except the profits now all go to the banks, not about a third to banks and two-thirds to solo market makers and smaller firms. (In fairness, there were other factors that contributed to the decline of the small market makers, not least an increase in regulation that’s not unlike the TSA in its ratio of apparent safety to actual safety. But aren’t the regulators in the pocket of the big banks anyway?)
Ieva Skrebele@#24:
ope, I have never been interested in PlayStation. Nor have I ever wanted to buy Japanese anime soundtracks. So, yes, I’m willing to believe that, due to the kind of interests I have, I simply didn’t notice any problems.
It’s the markets that are growing rapidly and have millions of users that get targeted by vendors for “divide and conquer.” The corporations realize “this is going to be big” and start staking out where they can dominate. Back in the early WWW days, 1992-4, there was nearly a big divide-and-conquer over secure transaction protocols – it was the UNIX wars all over again – but fortunately technological inertia and greed took over and SSL won. This stuff is everywhere and it subtly controls the market by controlling the choices that are available to the consumer.
colinday@#8:
Still bitter about the UNIX wars?
Heck, I’m still pissed off about VAX/VMS!
I picked this particular example because in practice it is happening and has been for many years now. You can read the 2006 article in the New York Times about it, and look at current prices on, say, my favourite Market Microstructure textbook: about $70 for ebook or hardcover in the U.S. and $23 hardcover, $18 Kindle in India.
This shows a gross misunderstanding of the bookselling business, and most other businesses too, for that matter. There is no magic “All Booksellers, U.K.” address to which you can ship a carton of books and expect that they’ll be magically marketed, promoted and placed in shops. There’s a good reason that a U.K. publisher will pay much more than a U.S. publisher for U.K. distribution rights for a book. As for your dismissal of evidence from someone who works in the industry, I’m just left speechless.
Curt Sampson @#28
That’s certainly great for people who live in India. I’m still waiting for the same kind of fairness to finally arrive also to the Eastern Europe. Alright, the last sentence was sarcasm—I’m cynical enough to know that there’s no point waiting, since it’s not going to happen anyway.
The industry, as it exists right now, is rotten. The existing system ought to be scrapped and completely replaced with something entirely different. The publishing industry isn’t working to serve its customers who buy books or music or whatever. It’s not even serving the interests of artists. Instead it’s serving to produce as much profit for the corporations as possible.
Charlie Stross’ article was about the reasons why, under the existing publishing system, it’s not possible to get rid of DRM. I never proposed to get rid of DRM under the existing publishing system. Instead I proposed to scrap and replace the entire damn system. Thus I’m justified to disregard her arguments, because what she’s talking about isn’t relevant to what I’m proposing. After all, it’s not like she was arguing for why the publishing industry as it stands right now is the best possible option humanity can potentially envision for how to distribute and sell books.
Ieva @29
Charlie Stross is male. His work is fun in a twisted sort of way. Check out his take on unicorns – https://www.tor.com/2013/09/24/equoid/
@Ieva:
It sounds like it’s not too important to you, but in case it becomes an issue (like when you have to send someone your address for a package, and you don’t know if that “I” will be misread as a lowercase “l”), this might work: There are a bunch of stretches of Unicode characters where the glyphs, as best I can tell, are Latin characters with serifs, including on the capital “I”. Of course, if your recipient is using an older system that doesn’t support at least Unicode 3.1, they might see a bunch of boxes, or “????”. Still, here’s what I found on my system.
𝐈𝐞𝐯𝐚
(U+1D408 MATHEMATICAL BOLD CAPITAL I)𝐼𝑒𝑣𝑎
(U+1D43C MATHEMATICAL ITALIC CAPITAL I)𝑰𝒆𝒗𝒂
(U+1D470 MATHEMATICAL BOLD ITALIC CAPITAL I)𝓘𝓮𝓿𝓪
(U+1D4D8 MATHEMATICAL BOLD SCRIPT CAPITAL I)𝙸𝚎𝚟𝚊
(U+1D678 MATHEMATICAL MONOSPACE CAPITAL I)I should actually check the above on different machines with potentially different font rendering. Hm.
. . . and further to #31, I see black squares on Android with Firefox. Sigh, nevermind.