Not enough people watch Game of Thrones

That might just sound like the subjective ramblings of someone who’s into blood, guts, quality drama and gratuitous nudity. But economic theory suggests that an inefficiently low number of people are enjoying George R.R. Martin’s fantasy epic, along with other cultural gems such as Wolf Hall, Mad Men, and Keeping Up With The Kardashians.

The BBC’s current system turns its rights over to private distributors who profit from the sole right to sell it on. Instead the Corporation could act as a ‘national netflix,’ negotiating purchase of the UK distribution rights to content, and making it available to the public for free.

Such a radical proposal makes sense because of the strange economics of the digital age. The cost of producing an episode of Game of Thrones is high – the first season alone set HBO back $50 million. But the cost of producing an extra copy of that episode is almost nothing. There are lots of people out there to whom the episode is worth only 50p, whereas it costs $4 on iTunes.

This argument applies to a lot of digital media – to e-books, to search engines, and to blogs. Google have found a way around it by monopolising the market and raising revenue from the vapour rising off viewers’ eyeballs. (Advertising). The Adam Smith Institute raises funding from wealthy, libertarian-minded donors. So far the best that TV has to offer is streaming services like iPlayer and Netflix, and the option of online piracy.

It would be anathema to suggest the government getting involved in the business of search engines. Producing the kind of unique institutional culture that Google has is very difficult for a private company to do, and almost impossible for the government. But a quality institution – the BBC – already exists. It already provides online media to millions for free, and iPlayer is an immensely successful streaming platform.

One concern might be the weakening of incentives to produce great shows. But in an age of piracy, producers are already finding innovative ways to finance projects that don’t require shutting out potential viewers.

Nationalising content rights might not seem very pro-freedom. But the current copyright laws provide content producers with a monopoly, preventing people from enjoying content that costs nothing to produce. In this case, government intervention can promote freedom.

Theo Clifford is winner of the 18-21 category of the ASI’s ‘Young Writer on Liberty’ competition. You can follow him on @Theo_Clifford, and read his blog at economicsondemand.com.

What an excellent argument against the BBC licence fee this is

Not that Ms. Reynolds means it this way of course, she thinks she is producing the concluding argument for the retention of the BBC’s licence fee:

Anne McElvoy makes several sound points (“‘The Beeb is not facing involuntary euthanasia’”, Comment). Her easy assumption, however, that BBC radio operates with an unfair advantage – “a serious radio competitor, for example, has never got off the ground…” – must not pass unchallenged. Commercial radio in the UK competes seriously and successfully wherever there is a mass audience to be attracted. It does not, however, compete in “serious radio” because the audience it would attract (for features, documentaries, drama, comedy, etc) is not sufficient to justify the higher costs entailed. What “serious radio” commercial competitor would, for instance, underwrite her regular Radio 3 arts review, Free Thinking, or her Radio 4 series on Charlemagne and his legacy, or even the show where she has now also become a regular, Radio 4’s Moral Maze? Meanwhile, as a frequent visitor to New Broadcasting House, it cannot have escaped her eagle eye that further cuts to BBC radio budgets will seriously threaten the continued existence of any kind of “serious radio”.

Gillian Reynolds

Radio critic, Daily Telegraph

London W2

The point being that there really are things that must be done and can only be done by government and the power to tax. Radio not being one of those of course. There’s also a weaker argument that there’s things it would be nice to have and where it’s worth taxing the masses to produce a benefit to said masses. But what there isn’t is a space for the argument that the proles must be taxed in order to provide something of only minority interest. For if something does not justify the costs then we should not be doing it. If producing “serious” radio costs more than can be gained from doing so then this is an activity which makes us all poorer.

The BBC licence fee is a tax of course. And we’re really sorry to have to point this out but the point of mass taxation is not so as to provide sweeties for some small section of the metropolitan intelligentsia.

That not many people are interested in “serious” radio is an argument against the tax funding of it: that it doesn’t, as claimed, cover the costs of its production is an argument against doing it at all, not in favour of taxing those who are uninterested in it.

Yes, let’s take BBC financing out of the political arena

We finally have what looks like a very sensible idea about the financing of the BBC:

Tony Hall, the director general of the BBC, has pledged to ensure that last week’s hasty deal with government to secure stable funding for the corporation will never happen again.

Writing for the Observer, Lord Hall, who has been forced to accept responsibility for the £750m cost of free licence fees for the over-75s, argues that key negotiations about the financial basis of the BBC must now be taken out of the political arena for good.

If one is to use the power of the state to take our money at gunpoint risk of a jail sentence for non-payment then it is right and just that the amount to be extorted and how be part of the political process. For that’s what that process is: the series of decisions over who may use that power of the state and how.

So, it would appear that the head of the BBC now agrees that the BBC should no longer be tax funded, but should perhaps charge a subscription, carry advertising, whatever. For that’s the only way that BBC funding can righteously or justly be divorced from the political process, by not using that process to gain said funding.

Sadly we’re just kidding. What is being meant here is that the BBC should continue to use said state power to extort from us all but that none of those beastly politicians, the ones we elect to decide who may use that state power, should have anything to do with it. Just an open hand into our wallets.

Which isn’t, we have to say, quite how we think the system should be working. You can ask for our money and if we like what you’re doing then you’ll get some of it: as all private sector businesses have to do. And if you demand our money with the weight of politics behind you then you’re going to have to put up with being controlled, or at least limited, by the politicians.

What you don’t get to do is use the power without accepting the oversight. Not while there’s still pitchforks and burning brands available to the citizenry you don’t.

Yes, first thing, let’s defund all the artists

We fully support the thrust of this article. Indeed, we’ve been saying much the same thing for years no, defund the arts:

Just the threat of the Tories forming a majority government was enough to start those in the arts squealing about cuts. Well, those living rich on state handouts would panic, wouldn’t they? But as a theatre critic, I have a simple plea for culture minister Ed Vaizey: stop all public funding of the arts, now!

I don’t say that because I believe the burden should be transferred to corporate sponsorship or American-style philanthropy. I say it having just come back from the Norfolk and the Norwich Festival where I sat through a show called What Will Have Been – an awful mix of contemporary circus and dance that could only exist through state funding.

The show was described as “ground-breaking,” as such shows always are, but it had much in common with every other piece of dreary, pretentious, self-consciously “arty” subsidised theatre that I have seen in 20 years of reviewing for The Stage and the former What’s On In London.

There is a difference here though in the reason why we would immediately stop all such funding. We don’t think that we are capable of, nor that we should be, deciding what art others might wish to enjoy. So our argument to defund the arts does not rest on the idea that much of what is funded is dreadful, stale, boring or even simply not to our taste. Given the existence of Simon Cowell there must be people who enjoy things that we find dreadful, stale, boring or even simply not to our taste.

Given that multiplicity of tastes out there the only way we can possibly justifiy any spending on such artistic endeavours is for the people who enjoy the specific form of it to pay for that specific form of it. We’ll not argue for subsidy of Dr. John if you don’t argue for subsidy of whatever it is that you enjoy and we do not.

There is then one further argument, that there are some forms of art (say, ballet and opera at the highest level) which we are told simply cannot exist without subsidy. Patrons of those arts would simply never pay enough to make the spectacles viable. Which is simply another way of stating that such spectacles make us all poorer. Those who see them are not willing to pay the cost of their production. Thus the benefit gained from their existence is less than the resources put into their production. That is the same thing as stating that they are subtracting value.

And we really don’t institute government to make us all poorer.

So, close down the Arts Council, abolish all tax subsidy of the arts and make the nation richer in the process.

An interesting idea to change copyright

We wouldn’t like to give anyone the idea that we think that the Green Party are anything other than somewhere between wildly misguided and entirely deluded on all matters. However, they have made one suggestion which is most certainly worthy of greater consideration. That’s to restrict the terms of copyright:

The Green party may be forced to backtrack on its proposals to limit UK copyright terms to 14 years after a howl of protest from prominent writers and artists including Linda Grant, Al Murray and Philip Pullman.

The Greens’ manifesto said the party aims to “make copyright shorter in length, fair and flexible” with the party’s policy website saying it would “introduce generally shorter copyright terms, with a usual maximum of 14 years”. Representatives of the party said on Thursday that length could be revised after a consultation.

There have indeed been howls of protest from just about everyone who has ever made a penny or two from stringing words together. As most of us here have made a penny or two from stringing words together as well perhaps we might add a little bit of grown up talk to the discussion?

The entire point of copyright (and also of patents) is to acknowledge that free markets, pure free markets entirely unadorned, are not the optimal solution to every problem. We’ll argue with anyone about the idea that they are the optimal solution to more problems than anyone currently allows them to be but we’re still insistent that this does not mean that they are perfect. And the issue of creation, whether of new ideas, new works of art or simply entertaining schlock is one of these areas. It’s difficult and time consuming, expensive in other words, to produce new material in any of these fields. It’s extraordinarily easy to copy it once that has been done.

This means that in a purely free market system it will be very difficult to profit from creation thus we think there will be less creation than we might want. So, we add protections for the creators. We have, simply, entirely invented this concept of “intellectual property”. That provides the incentive to create.

However, there’s also the point that we like derivative creation as well: someone creating atop the bones of what has gone before. And too long a, or too restrictive terms of, protection will limit and hinder this. So, some protection of creation is desirable and too much is not.

But note where this leads us. It is that original creation that we wish to encourage. And, if we’re honest about it, writing a book now is not influenced in any manner at all by the thought that a literary estate might still be earning from it 70 years after the authors’ death. The Sherlock Holmes stories only recently went out of copyright: does anyone think Conan Doyle was in the slightest influenced to write by what the stories might earn in the 1980s? Or take the lengthening of sound recording copyrights from 50 to 70 years just recently. Does anyone really think that Cliff Richard was incentivised to record “Living Doll” by how much it might make him in 2010? Sure, in 2010 he was very interested in the subject as he campaigned on the issue but what we want to know is what pushed him in the first place, not what he thinks post facto. Given that he did the recording under a 50 year protection does rather show that the 70 year protection was not necessary to encourage that original creation.

So, therefore, we probably shouldn’t have the longer protection.

14 years might be too short a period of time. From memory that was actually the time period in the early 18th century, and it could be renewed at least once. Full marks to the Greens for actually recognising this as an interesting area for discussion. But we would have thought that reverting to that 18th century was a bit odd for them. For they normally want us to fast forward to the Middle Ages don’t they?