Letterman and shock culture: Structure, Conduct, Performance

It is a far stretch to insinuate that Mr. Letterman, that avant garde man of letters, in any way engineered the current frakas.

That said, weird as it is, he likely to benefit in the ratings game.

In one of its accidentally successful frameworks, McKinsey came up with the SCP idea to aid Industry Analysis--
(S): Structure: A structure, decided by policy, costs and norms, exists in an Industry. The global steel Industry has huge economies of scale, is faced with buyers that can play on supplier against another, and ore is located far from demand, forcing advantage to mill owners who can buy vast volumes from mine owners and feed it to operations world wide-- it is a structure that favors scale and cross-globe holdings. The Entertainment Network industry has a structure where 70% of eyeballs are attacted by 10% of shows. Loyalty for a successful show can be high if a successful formula and personality are found, eyeballs dictate revenue, and these eyebalss allocate attention by shock value

(C): Conduct: Industry structure drives the conduct of players. The global steel Industry has a structure that favors scale and cross-globe holdings. The Entertainment Network industry has a structure that allocates attention by shock value of conduct. So, steel magnates have tended to consolidate capacity and huge, multinational M&A is common. In entertainment industry, networks seek programs that can shock. Late night shows, more insulated by the norms that look askance at exposure of the young'ns to debauchery, are more free to satisfy this demand for shock.

(P): Performance: How players in an Industry perform is driven by their conduct. Steel Industry has very volatile earnings (performance is cyclical)-- the London Metal Exchange can supply the spot price for steel, making price transparent, and mill owners price takers. Supply-Demand balance dictates price almost entirely. That and fuel cost, but that is baked into all commodities.

The Entertainment industry has become progressively more raunchy. Accidental dissolution too brings disrepute, notoriety, and eyeballs. Eyeballs rule.

So, while David didn't mean for it to be so, his misfortunate dalliance would probably accrue a fortune for his sponsor network. Sphere: Related Content

Not So Obscure: Paten Law, Supreme Court, and Aristotle's Four Causes

In one of my recent blogs I invoke Aristotle's Four Causes theory-- that an effect has four identifiable causes;

1. Material Cause: the material of which the effect is made (a statue of stone, so the material cause of a statue is stone)
2. Efficient Cause: the (physical?) agency that marshals the effort to shape the material (human arms that chiseled the statue)
3. Formal Cause: The design that artists mind, or the program that drives the agency in (2) above.
4. Final Cause: The purpose that motivates the final cause. For the statue, it may be the need to satisfy a customer.

The Supreme Court recently heard a case on the patentability of software. As you'd see from the list above, it is unclear where software lies between (2) and (3) above. I hold that patent laws have been seen in the US justice system to apply to the "efficient cause". In the case of software, is it the efficient cause or the formal cause of problem solving? I'd say that is the nub of the issue.

I hold that it is the efficient cause, and so should be patentable. Red Hat lawyers, on the other had, do not. They argue,

"the Supreme Court and lower courts had held that abstractions couldn't be patented and that a patent needed to cover an abstraction incorporated into a particular machine, or be a process that "transforms a particular article into a different state or thing," Tiller wrote."

The wording "an abstraction incorporated into a particular machine," suggests they believe the machine is the efficient cause, the code the formal cause. And therefore a machines is patentable, and software not patentable.

This just to illustrate that these philosophical concepts are more applicable than we credit them. And that fasting is productive of philosophical thought.

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Cell Phones Go Fishing: A Case Study From Kerela, India

In a study on the impact of improved information on commerce, Harvards Robert Jensen makes some interesting, though entirely unsurprising, observations.

In brief, for an extended period before the penetration of phones, fisherman in Kerela had seen their incomes decline. Forced to compete in local markets, at the mercy of local traders, they had seen both prices and volumes decline over the years.

Then with the advent of cell phones, these same fishermen could discover the best prices rapidly, leading to better prices for the fishermen, AND, lower average prices for the customers.

A true Pereto optimality.

More later.

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