Saturday, 21 March 2009

Pay for online content

Well, I'm learning my way around blogspot. Which is nice, as it means I'll better be able to express myself, and pass on those views (of my own, as well as of others) that are the reason for this blog.

However, my first "news" style post is of bad news. The business model of the "free" internet is going to fall down, at least according to this week's Economist.

Key points to note:
1. They've said this before:

“IN RECENT years, consumers have become used to feasting on online freebies of all sorts: news, share quotes, music, e-mail and even speedy internet access. These days, however, dotcoms are not making news with yet more free offerings, but with lay-offs—and with announcements that they are to start charging for their services.” These words appeared in The Economist in April 2001, but they’re just as applicable today.

2. They weren't entirely wrong last time - think of the collapse in value of AOL and its ilk.

3. A certain fundamental of all business must assert itself:

The nature of the internet means that the barrier to entry for new companies is very low—indeed, thanks to technological improvements, it is even lower in the Web 2.0 era than it was in the dotcom era. The internet also allows companies to exploit network effects to attract and retain users very quickly and cheaply. So it is not surprising that rival search engines, social networks or video-sharing sites give their services away in order to attract users, and put the difficult question of how to make money to one side. If you worry too much about a revenue model early on, you risk being left behind.
Ultimately, though, every business needs revenues—and advertising, it transpires, is not going to provide enough. Free content and services were a beguiling idea. But the lesson of two internet bubbles is that somebody somewhere is going to have to pick up the tab for lunch.

My two pence? Facebook and Twitter will survive. They might turn out not to be worth the billions of dollars that they once were, but they'll still turn a profit on day. Also, news websites will still allow free access to their articles. They might, however, charge for access to yesterday's, or last week's archive. At the very least, they might ask you to register, so that they can use your email address for marketing purposes. But there will long be free news articles available on the web.

The Economist itself allows you to read their £4 "newspaper" (I consider it a magazine) for free online. They clearly aren't too sure that the free model is dead, yet.

My favourite sites/blogs

As a follower of the credit crunch and a Bachelor of the Science of Economics I have a few opinions of my own. In this blog I will sometimes expound these views. However, in this post, I will tell you where I acquire my information, and which ideas I see. Firstly, I would like to recommend Baseline Scenario as a source of analysis on the credit crunch. It has an explanation of the situation's causes (as they see it) and several daily posts on policy proposals and economic data.I would also recommend and Paul Krugman's twice weekly Op-Ed articles in the New York Times. Various other contributors on also have interesting views.The Economist always has interesting views on current affairs (not just Economics) but here I will recommend their columnist blogs, available here: I particularly like Bagehot, Charlemagne, Free Exchange and Democracy in America, but the others are also worth reading.I'll also mention Greg Mankiw: and the New York Review of Books: which has some interesting articles (updated approximately fortnightly, in line with their print copy).
For Formula 1, I will recommend and but if you want lots of information provides links to many of the main news sources for the sport. Former commentator James Allen has a blog available at
Assorted other sites draw in my daily attention -,,, and for news and cartoons.
Finally, I would like to promote my very first attempt at a website: and its newer version: which sells good quality sunglasses at low prices. Prescription sunglasses are available, as are designer names (including Porsche!)

Formula 1

I have watched Formula 1 for most of my life (not literally, I sleep, eat and so forth as well). I'm a young man, and yet I remember watching Gerhard Berger's car go up in flames at Imola in 1989 live. did find the late 90s period of no overtaking tiresome, but I continued to watch.I found the annual rewriting of the rules absurd, but I continued to watch.I have watched 5 very exciting campaigns over the past 6 years (2003, 2005, 2006, 2007, 2008) and feel no doubts that little change was in fact so necessary.I miss the days of a crowded grid, with privateers running engines of different sizes, forms, power. I understand how that situation ended (sponsors only backed the winners, the winners spent more money, none of the otehrs could keep up, so the winners pulled ahead, etc.)However, this doesn't quite match reality. The fastest laptimes of the best and worst cars is miniscule nowadays (2-4% depending on the drivers and circuit). In years gone by, that differentail separated first from second. It is the fact that most cars finish most races, that has lead to the increase in differential in sponsorship between top and bottom. That, and the TV cameras' preference for red cars, which was true when Ferrari was losing and more true when they win.
Despite all of this, I was thoroughly excited about the new season (I always am).The new regulations (dramatic changes to rules governing aerodynamics, a return to "slick" tyres, adjustments to the safety car rules and a few other tweaks) promised to shake up the grid (as the advantage of basing your new model on its succesful predecessor is undermined).My favourite driver was saved from enforced retirement as the former Honda team were saved (and brought back as Brawn GP). Then, miracle upon miracle, it appeared that the car is quicker than its rivals. Of course, this triggered questions (it always does).
Then, the FIA does its utmost to undermine my excitement. At the World Motorsport Council it passes a new set of regulations (2 weeks before the season starts) that would change the manner through which championships are decided (most wins wins, rather than most points wins). I oppose this, as it would force teams to back a driver over his teammate early in the season, if they wanted to win the drivers championship. It also renders any position below 2nd nearly meaningless (so a driver forced to the back in an early incident has nothing to fight for).The teams complained, and it turns out that the FIA's rules show it illegal for them to bring in such a fundamental change, at such short notice, without the unanimous approval of the teams.Then, they decide to push the change back to 2010. Given the huge outcry (see any F1 fans forum, or any news agency) surely the FIA could admit "we got it wrong". But no such luck.
I'm upset, because my excitement has been dented. Hopefully the Brawn will still be quick, the races will still be exciting (even more overtaking than before, apparently) and the championship will not be settled until the autumn. But really, it annoys me that the FIA and FOTA (the teams association) can't get along.


A few opening thoughts:

1. This is my first blog. Feel free to point out obvious things I'm missing or should be doing.
2. Comments welcome. Criticism welcome. Praise welcome. Abuse not welcome.
3. Topics: I'll most likely discuss/opine upon the following:
  • The economy (hence Credit Funch)
  • Formula 1 (my favourite sport, I support Rubens Barrichello for those wishing to spot bias)
  • A few other sports
  • British and American politics
  • Assorted minor events in my life
  • Rebuttals to accepted wisdom (well, this is a blog, after all)

4. Regularity. I may post during the week, I may not. I will post at weekends, probably.