Foreign Culture Wars

When it comes to culture, Europeans think differently than many of us west of the Atlantic.  Just last month, European countries, led by France, unanimously endorsed the concept of ‘cultural exception’ in the current U.S.-European trade deal talks—meaning that cultural industries are exempted from full exposure to the free-trade winds that will blow through other industries under the new agreement.  It’s a position that in the U.S., with its mega-imagesscale cultural industries (Amazon and books, Hollywood and movies, ABC and Desperate Housewives, etc.), seems almost nonsensical.  For someone like the late Jack Valenti, Hollywood lobbyist extraordinaire, it’s simply a matter of cultural industries outside the U.S. failing to make competitive product.  He used words like “baloney,” “odious” and “a needless crutch”, for instance, when describing quotas on foreign television previously established by EU member states.

It’s a battle that Canada had to fight when negotiating its own free-trade deal with the U.S. back in the 80s.  At the time the Americans were keenly interested in gaining unfettered access to both the energy and cultural industries in Canada.  And, in the interest of context, it’s worth tracking back further, to the institution of ‘Canadian content’ regulations in the early 70s.  Prior to 1971, for instance, Canadian musicians heard on the radio were a thin and scattered bunch.  Following the imposition of the ‘Can-con’ rules, there was a veritable explosion of Canadian musical talent, from recording artists as diverse as Anne Murray and Steppenwolf.  (Although Anne may have won the day on most radio stations, prompting one wag to wonder whether AM was in fact her moniker.)  The digital revolution has since of course, negatively impacted the music industry as much as it has any trade anywhere, but, for a time, the pop music scene in Canada was never more robust.

In TV too, the original imposition of Canadian content rules quickly spawned a sizable industry that had previously been hardly present at all, and that continues as viable to this day.  There was an original mandate with government subsidies of the film and television industry to create product that was ‘culturally distinct’—stories would be ‘recognizably Canadian’—and with globalization that mandate has suffered (Is there anything genuinely recognizable as Canadian about a show like Rookie Blue?), causing one to wonder if the TV industry is still ‘cultural’ at all, but I digress.

The point is that cultural industries outside nation-state juggernauts like the U.S. and China have historically needed protection in order to flourish, if not survive.  What someone like Jack Valenti failed to recognize is that it takes the same ratio of talent within any pool to produce hits, regardless of place; therefore the Canadian or French pool has to be protected if it is to remain large enough to produce proportionately fewer hits, that is enough hits to survive.  Without that protection the industry will simply be overrun by the wildly larger numbers of both people and dollars emanating from the American cultural behemoth.

Which is exactly what has happened with the Canadian movie industry, where Can-con rules have never been applied.  (If you’re wondering why, perhaps it’s sufficient to say that Hollywood movie distribution contracts, back in the day, did not even recognize Canada as a separate territory.)  While the Canadian radio and television industries have evolved a reasonably sound business model, the same can’t be said about the indigenous movie industry in Canada.  It has been, and remains marginal; what I have described as an ‘ego-driven crap shoot’ where few people are employed, and audiences are meager.  (I’m referencing English-speaking Canada here; French Canadians actually go to see their own movies in considerable numbers.)

In Europe, French regulations delay the release of DVDs, in order to preserve movie houses.  German regulations force online book retailers to sell their product at list prices, in order to preserve bookstores.  Different thinking.

The internet of course arose in a ‘wild west’ American culture where any form of regulation was considered anathema.  In 2000, Yahoo! was sued in France after Nazi memorabilia was offered for sale on its auction site.  (It’s essentially illegal to sell such stuff in France in any venue.)  Yahoo! fought back, arguing “free speech,” that France could not rightly impose its laws on a U.S. company.  Yahoo! lost that case.

Vive la différence.

 

Marx Was Right

Those politicos who chant the competition-as-salvation mantra, especially those in America, may find it hard to believe, but not so long ago many prominent U.S. businessmen and politicians were singing the praises of corporate monopoly.  Incredibly, given America’s current climate of opinion—where the word government, never mind socialism, seems a dirty word—just 100 years ago, it was widely believed that there were four basic industries with “public callings”—telecommunications, transportation, banking and energy—that were best instituted as government sanctioned monopolies.  The most successful of the corporate entities to occupy this place of economic privilege was the American Telephone and Telegraph Company (AT&T), and here’s what its then President, Theodore Vail, had to say about the social value of competition, “In the long run… the public as a whole has never benefited by destructive competition.”

Groucho's older brother Karl (kidding)
Groucho’s older brother Karl (kidding)

Karl Marx may have been wrong about many things, including what best motivates the average human being, but he was certainly not wrong when he suggested that capitalism tends directly toward monopoly.  How could it not, when the most durable means of defeating the competition will always be to simply eliminate it?  In 1913, AT&T had been remarkably successful in doing just that, and its monopoly would survive undiminished until 1982, when the Reagan administration oversaw the breakup of AT&T into the seven so-called ‘Baby Bells.’

(Before you conclude that it’s only right-thinking, right-leaning governments, like Reagan’s, that can properly control corporate America, know that it was also a Republican administration, under President Taft, that condoned the ascendency to monopoly by AT&T in 1913.)

Tim Wu, in his book The Master Switch (cited last week in this blog), has postulated “the cycle” as continuously operative in the communications industries (all the way from telegraph to TV), whereby technical innovation gives birth to an initially wide-open trade, but where soon enough corporate consolidation leads to singular business empires.  It’s worth noting that by 2006, AT&T had, via some truly brutal business practices, essentially reunited its pre-breakup empire, leaving only two of the Baby Bells, Verizon and Qwest, still intact and independent.

The latest example of the tendency toward monopoly in Canada can be seen readily at play in the federal government’s efforts to boost competition among the oligopoly of this country’s big three telephone providers, Telus, Bell and Rogers.  Evidence suggests that, prior to the government’s most recent intervention—in 2008 reserving wireless spectrum for new companies like Mobilicity, Wind and Public Mobile—Canadians paid some of the highest mobile phone charges in the world.  Since their entry into the marketplace, these three rookie players, have—what a surprise—struggled to prosper, even survive in the face of fierce competition from the triad of telecom veterans.  All three ‘Canadian babies’ are now said to be up for sale, and the feds, to their credit, stepped in earlier this year to block a takeover of Wind Mobile by Telus Corp.

Former Baby Bell Verizon—now referred to in comparison to Canadian telecoms as “giant” or “huge”—is reported to be circling Canada’s wireless market, rumoured to be considering a bid on either of Wind Mobile or Mobilicity.  Facilitating this move—and setting off alarm bells (no pun intended) near the Canadian cultural core—is a recent legislative relaxation of formerly stringent foreign ownership rules to allow foreign takeovers of telecoms with less than 10 per cent of the market.

Wu’s book asks if the internet will succumb to the same cycle of amalgamation that so many other electronic media have.  His answer: too soon to tell, but history teaches us to keep a wary eye.  And if you consider Apple’s cozy relationship with AT&T over the iPhone, or the fact that Google and Verizon have courted, you’d have to agree with his concern.  Wu concludes his book with an advocacy of what he terms “The Separations Principle,” an enforced separation of “those who develop information, those who control the network infrastructure on which it travels, and those who control the tools or venues of access” to that information.

The internet, given its decentralized construction, is not easy to consolidate, but no one should feel confident that today’s corporate titans won’t try.  Nor should we underestimate their ability to succeed in that effort.

 

Future Imperfect

“You’re welcome to Le Carre—he hasn’t got any future.”

—A publisher who rejected John Le Carre’s The Spy Who Came In From the Cold, which would go on to be described by Publishers Weekly as “the best spy novel of all-time.”

file000152304352 When it comes to predicting the future, we all make mistakes.  As we age, we hope to make them slightly less often, but, let me assure you, we never entirely escape the incidence.  Some of us, however, are in positions of authority which make the dimensions of our prognosticating blunders truly spectacular.  Infamous examples abound, especially in the cultural realm…

“Who the hell wants to hear actors talk?”

—Harry Warner of Warner Brothers, dismissing the idea of ‘talkies’ in 1925.

“Guitar groups are on the way out… The Beatles have no future in show business.”

—Dick Rowe, Decca Recording executive, snubbing The Beatles in 1962.

So too in the realm of technological future-telling.  Tim Wu, in his highly entertaining The Master Switch, recounts how in 1877 Western Union [Telegraph] was the most powerful information corporation on the planet, exclusive owners of the only continent-wide communications network.  The Bell [Telephone] Company was at the time a new and struggling tech firm with few customers and even fewer investors.  Such was the financial duress felt by Bell that the company’s President offered Western Union all of Bell’s patents for $100,000.  William Orton, Western Union’s President, declined the offer.  A company memo circulated a year earlier summed up Western Union’s take on the admittedly primitive Bell technology: “This ‘telephone’ has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us.”

Lest you think that the pace of technical innovation was invariably slower in the 19th century, it should be noted that, less than a year later, Western Union recognized the error of that take, and embarked upon a furious development effort of its own, commissioning a promising young inventor named Thomas Edison to come up with a better phone.  The effort would prove strangely inopportune (proving that luck too always plays a part in determining the future), when, just as Bell launched a patent-infringement lawsuit, it was discovered that Jay Gould, Robber Baron King mentioned elsewhere on this blogsite, was secretly buying up shares of Western Union, in preparation for a hostile takeover.  Western Union was suddenly obliged to view its telephone dust-up as a “lesser skirmish, one it no longer had the luxury of fighting.”  The company settled out of court with Bell on less than favorable terms, and Bell soon re-emerged as the American Telephone and Telegraph Company (AT&T), which would become the most successful communications company of the 20th century.

file1251307481611In a ‘look back’ article published earlier this year, U.S. News revisited its own predictive report from 1967 entitled, “The Wondrous World of 1990.”  The predictions made in the 1967 piece range from wide misses—a manned Mars landing, a cure for the common cold—to the remarkably prescient—a “checkless, cashless” economy, an “automated” (Google?) car.  (A blithe addendum notes how, if the driver of the robotic car does not accelerate as instructed, “the [computerized] roadway takes over control.”)

More broadly, two prophecies stand out for me in the 1967 article, two points central to the themes of this blog.  One is a miss; the other a palpable hit.  The miss discusses how, “Production and wealth will rise faster than population, so that incomes will climb steadily.”  This in turn will mean that the typical 1967 worker, who was then putting in about 2000 hours a year on the job, would, by 1990, see those hours drop to 1700 or less.  “The four-day week will arrive,” trumpets the article.

If only they had gotten that right.

The hit relates to, “Underlying the transformation to come is a quickening in the tempo of development out of scientific discoveries already made.”  One Dr. Richard G. Folsom, then President of Rensselaer Polytechnic Institute, is quoted: “The magnitude of change will expand, even explode.”

That much they did get right.

 

Documentary Demise

Documentary film may be the definitive post-digital-revolution media product: big audience; no market.  From all indications, documentaries are as popular as ever, perhaps more so, but making—that is financing—documentary films these days?  That’s another story.  In a recent report, titled Getting Real, the Documentary Organization of Canada reported that Documentary production volume decreased in Canada by more than 21% from 2008/09 to 2010/11.  The number of documentary projects dropped 23% in that time, from 591 to 457.  It’s not at all likely that the situation has improved any since.

IMG_8598 (2)The decline began with the great 2008 recession.  The television industry is one of the very first to feel any economic downturn, as even large companies can quickly cut advertising budgets in response to nose diving sales.  But, as the report indicates, by 2010, “Canadian conventional broadcasting revenues rebounded to pre-2008 levels, and specialty cable channel revenues continued to grow despite the recession.”  Essentially, Canadian broadcasters seized the opportunity presented by the 2008 crash to reduce or suspend the commissioning of documentaries, and they have chosen to maintain that diminution ever since, despite revived revenues.  Government regulators have meekly stood by over this dismal decay, too timid to promote cultural values in the face of stressful times within the free enterprise arena where combatants like Rogers, Bell and Shaw snarl and throw up their steroid-enhanced arms to the roar of the ratings crowd.

Prior to 2008, all three of the major Canadian networks, CTV, Global and the CBC, carried documentary ‘strands’ as part of their regular programming schedules, commissioning numerous one-off documentaries each season, usually as part of a loosely integrated series.  Audience numbers were not huge, but they were steady, and it meant that a vibrant community of documentary filmmakers existed across the country, and that Canadian audiences were regularly exposed to their work, along with the stories and issues contained therein.

Alternate means of funding have of course arisen post-revolution, chief among them crowdsourcing, but another recent report, this one by the Canadian Media Fund (CMF), called Crowdfunding in a Canadian Context, is illuminating in this regard.  Despite the lurid success stories of millions raised in just days (akin to those mega-rare video clips that go viral, when it’s hoped that every clip posted will), the report makes it clear that, “Crowdfunding is best suited to independent producers and developers who work on a smaller scale, with smaller budgets.”

Documentary filmmaking is far less expensive than is dramatic filmmaking, but when the making is by experienced professionals, budgets generally still need to run at least $250,000 for an hour-long show.  The larger Canadian production houses, those with full-time staff and facilities to pay for, are reluctant to consider a budget of less than $400,000 per hour.  (A top-drawer freelance documentary cameraperson will be looking for $800-$1000 per day, the best editors for $1800-$2000 per week.)  The CMF report states, “Crowdfunding appears to be best suited to smaller-scale funding with the majority of projects posting funding goals and reaching funding volumes of between $10,000 and $50,000.”

Adding to the problem is the decreased cost of production hardware.  Topline video cameras that just 10 years ago sold for $20,000 can now be replaced by DSLR cameras costing less than one-tenth of that amount.  Ditto with computer editing systems.  Post-production set-ups that once filled rooms with multiple monitors, tape decks and tower drives, are now supplanted by a laptop set upon… well, your lap.  These days just about anyone capable of picking up, pointing and pushing the record button on a camera, then operating a computer, can go about making a documentary.  It’s meant that there is a plethora of product out there now.  Most of it isn’t very good, but it’s out there, glutting the market.

The post-e-revolution landscape is an arid one for documentary filmmakers.  Their great tradition is fast becoming like too many other contemporary art practices, something that young, single people living in shared accommodations can afford to pursue, or that people with other jobs serving to pay the mortgage and feed the kids can create as a sideline.  Despite a ready audience, the documentary artform, as practiced by skilled professionals, is wasting away.