The Chris Voss Show - The Chris Voss Show Podcast – Digital Renaissance: What Data and Economics Tell Us about the Future of Popular Culture By Joel Waldfogel

Episode Date: July 3, 2020

Digital Renaissance: What Data and Economics Tell Us about the Future of Popular Culture By Joel Waldfogel

Hi folks, Chris Voss here from thechrisvossshow.com, thechrisvossshow.com. Hey, we're coming here with another great podcast. We certainly appreciate you guys tuning in. All of you, not just one of you, but all of you, we appreciate you guys being here. Be sure to refer the show, refer the show. Grab someone, grab that person sitting next to you, not that one, the other one. Grab them and say, have you subscribed to the Chris Voss Show podcast? If not, grab their phone and go to thecvpn.com and tell them to subscribe.

We've got a most excellent author on today, a gentleman who's done several books, and you can see the live version of our discussion on youtube.com forward slash Chris Voss. If you want to check that baby out hit that bell notification for all the wonderful things that you're doing there today we have joel waldfogel he brings an economist perspective and lots of data to study questions that are interesting important and also fun for the last, he has studied how digitization has performed the music, movie, book, and television industries. His work is the subject of a book called Digital Renaissance. Early in his career, he focused attention on the wastefulness of holiday gift-giving in his book Scroogenomics, and before that, he developed ideas about the tyranny of the market,

that markets deliver what large groups like-minded consumers want, and these small groups with atypical preferences wanting. Welcome to the show, Joel. How are you doing, buddy? Great. Good to be here. Awesome sauce. So you're a multi-faceted author of a number of different books. And give us, where can people find you on the web or maybe find your books on the web? Where do you want to plug those? Certainly at Amazon.com. I'm a professor at the University of Minnesota,

so you can find my, I have a not very interesting personal website at the University of Minnesota as well. All right. Well, hey, we know you're smart because you're a professor. So there you go, right? Well, maybe.

We'll see. Okay. All right. Well, you've got three books going, so you're doing something right. So awesome sauce. Check them out on amazon.com. There'll be a link on the Chris Foss show as well. So digital Renaissance, this is an interesting book that he's put out. You can find this book. It's available on Princeton university press. And I was really interested because it talks about what data and economic tells us about the future of popular culture. And I was really interested because it talks about what data and economics tells us about the future of popular culture.

And I was really interested in the future. So tell us, Joel, what is the future? Well, you know, the future has been with us for a little while now. So for cultural industries, maybe the big event that brought the future to us was kind of the creation of the Internet. And in particular, something in 1999, the development of the software called Napster, which allowed kids mainly just to steal music, to get music without paying for it. Well, yeah, it's funny, you know, depending on how old people are, they think it's their birthright to get music for free. But in any event, if you're a person who sells music, a record label or recording artist, this was really the beginning of the end. And from 1999 to basically a few years ago, music industry,

recorded music revenue fell by well over 50%, just calamitous collapse of revenue. And now the reason why the rest of us might care is because it does cost some money to bring new products to market. We all like music. And so if the record labels can't earn any money, if the artists can't earn any money, we might worry about new artists just giving it up and not creating anything new. That really was the concern people had at the kind of dawn of the bad news of digitization, Napster. And frankly, that's not the only bit of bad news for the musicians. A lot of musicians and artists really complained pretty bitterly about the small payments they perceived themselves to be paid for being streamed on Spotify, you know, a fraction of a cent per song and so forth. So there's been a lot of talk about how technological change, stuff related really to the internet, has just undermined the ability of the creative industries to continue to create stuff. That's the setup. Of course, with the title of a book like Digital Renaissance, that's probably not the final answer, but that is the setup. And that's really what people quite earnestly thought. And I think for good reason for a while.

So the main, the thrust of your book, you talk about what it tells you about popular culture. What do you find at the, maybe we shouldn't give away the ending, but I mean, do you find that it's a good thing or that it's a bad thing? We'll get to, it'll be a good thing, but let me talk about the process and give even a fair shot to the fear mongers who had concerns.

The way these industries work is that a lot of people want to write books, have their books published. A lot of people want to produce movies. A lot of people want to have their music released. And so people would essentially line up and try out and try to get these intermediaries, the record labels and the movie studios and the publishing houses to basically bet on them, sign them, invest in them,

bet on them and promote them. The way this industry works, though, it's a super unpredictable industry. It's really hard, even for people very skilled at this, to decide in advance which things are going to be worth investing in. So it's amazing. You look at movies, there are some huge budget flops, you know, something like five or 10% of these products succeed in the sense of really making a lot of revenue enough to cover their costs. So it's always been an expensive crapshoot, just sort of the non-technical way to say it. A lot of investment and very risky, very hard to predict which ones would win. Now, digitization comes along. In the first part of it, we already talked about it. It was like bad news on the revenue side.

That just makes it harder. But that wasn't the only thing that happened. The other aspect of digitization is that by reducing the cost of communicating, but by basically the cost of producing all these products and distributing them, and I'll explain what I mean in a second, like think about music. You used to need skilled labor, an expensive studio. Then you needed to have this thing pressed onto discs. You need to get it into stores.

You needed to have these, a lot of really important commercial relationships. Now you just record a song. It used to be you upload it to iTunes. Now you get it on Spotify. And all of a sudden you have global distribution. It didn't really cost anything. I I mean it used to be almost impossible now anyone can have global distribution of any of these products almost for free the thing is so

that's sort of good news except if you're a traditional guy if you're a publishing house or a major record label you would say the following well wait a minute those are a bunch of barbarians. We're going to have barbarians storming the gates, just drowning us in bad music, bad books, bad television, bad movies. And of course, there's a lot of truth to that. But here's the thing. It's super unpredictable which things are actually going to be good. And so what we get with this enormous pile of, I'll go ahead and call it bad, but I just mean commercially unsuccessful. What we get with this enormous pile of, I'll go ahead and call it bad, but I just mean commercially unsuccessful. What we get with a big pile of commercially unsuccessful things is a few standout successes, things that were unpredictably good. And now we have them. And now that's the source of what I call the digital renaissance. So for, you know, every thousand terrible, let's go ahead and say just terrible, not in an aesthetic sense, but even just in a commercial sense.

For every thousand terrible things, we have some things that wouldn't have made it through, but do now, and are really important to consumers. So I'm an economist, not a professor of culture. So I'm going to say good. When I say good, I mean valuable to consumers. So for example, Fifty Shades of Grey. Cultural snobs will tell you it's a terrible book, and they may well be right, but it's one of the most popular books ever written, and it's a book made possible only by digitization. Some person could write Twilight fan fiction, it could catch on, and it could become enormously popular, and then become republished by a traditional commercial press. And there are just hundreds of examples like that in the book context, the music context, the movie context. that's what the digital renaissance is the democratization of creation and

distribution a big pile of garbage and a whole bunch of good things you know sort of needles in that that was the word i was looking for the democratization i was going to ask you about that um because that's certainly what it did uh would har Potter fall into that? I know she kind of came out of obscurity. I mean, so she's kind of a, she's an old fashioned in some sense. I mean, so she, there, there is a story, I believe, of many rejections by, by, you know, she, she, she toiled in obscurity before she finally got signed by a traditional. So I don't think she's an example,

but there are many examples of people who went ahead and just said, okay, fine, I'm not going to get a contract with a traditional outfit. So I'll just go ahead and do it myself. I mean, there are various versions of doing it myself that vary across these industries. Like in music, it's true, there literally is self-released stuff. But there's also this whole sector of so-called independent record labels, alongside this other sector of major record labels. The major record labels are the ones owned by the huge conglomerates, and they traditionally accounted for the vast majority of sales, although a relatively small number of releases. And there were a lot of sort of a fringe of indie record labels releasing, you know, college

music and so forth, you know, kind of music for snobs, or not snobs, but just music for people of unusual taste. We just lost the snob audience. Yeah, no, I mean, I, well, I admit that in a nice way, but in any event, so if you couldn't be signed by a major, you didn't seem bankable commercially, you could release kind of this indie sector, but it was pretty hard to get discovered because radio wasn't going to play you. I mean, radio played very little of that stuff. So again,

digitization has brought, brought us things like Pandora, Spotify, Apple Music, where everybody gets a seat at the table. Now, I'm not going to pretend every seat at the table is the same. Clearly, you get promoted if you're from a major outfit. But still, we see a lot of artists coming from obscurity and success. So in music, maybe people's favorite example is Justin Bieber. Justin Bieber was discovered on YouTube. You know, he was on YouTube and then Scooter Brown,

this famous producer saw him and said, this guy's bankable. And he went, you know, sort of straight to the top in a sense that would have been hard if he had just been sending in his demo tape. But there are many, many examples like that in all these industries. Who's the other gal who came up around the time of Justin Bieber? She's the largest Taylor who came up around the time of Justin Bieber? She's the largest. Taylor Swift did the same thing, YouTube videos. I think she was signed, so she was on Big Machine.

I think she might have been signed to a big label. Didn't she start like Justin Bieber, though, doing YouTube videos? It could be. I can't remember. It could be. It certainly can't have hurt her, but she seems like a – I mean, the folks that are, I mean,

there are lots of examples of various kinds, but if you go back even 10 years now, which brings you 10 years into this kind of revolution, you start seeing bands like, what's the matter with me? I'm losing my memory at my age.

At this point, this year, it's a good thing. Arcade Fire, sorry. So you see bands like Arcade Fire. They're on an indie record label, you know, but they've had some critical success, but no major radio airplay.

And they go and win the best album Grammy. This is a kind of, you know, an example of a phenomenon of these guys going in some sense around the traditional gatekeepers, but finding pretty big favor with consumers and even winning, you know, winning Grammys. If you look at the share of independent record label music, that is the share of music sales that are accounted for by that.

It used to be a number like 10%, 5%. It's grown depending on how you count, you know, it's grown by a factor of three. Again, showing that the kind of stuff that didn't used to get released in any real way to consumers has now become a big share of what people actually consume. My favorite example of a statistic like this is the share of best-selling books accounted for by books that were originally self-published. So like the 50 Shades story. I mean, that used to be a non-existent phenomenon. Self-published. So like the 50 Shades story.

I mean, that used to be a non-existent phenomenon. Self-published books were things that, you know, embarrassing things that people did. But, you know, after the Kindle appeared in about 2008, it was possible to self-publish a book, make it available on Amazon. And again, many of those don't sell at all. But if you look at the top 150 sellers by week in the USA Today bestseller list, it went from 0% of them having been originally self-published to about 10% in

three or four years. And in the romance category, the category where Fifty Shades lives, it reached about 50%. I mean, that's a shocking statistic. If you're a New York publishing house looking at a world where half of the best sellers are books that establish themselves without you, you, the traditional gatekeepers, no longer have control. It's pretty amazing, the romance section of books. We're always looking for people to bring on the show and inviting people. And every now and then I've got a stream that I go into for books on Twitter and just the romance stuff is overwhelming. And I'm sure the quality is awful.

Well, I don't know. I shouldn't say that. Maybe, I mean, I don't, that's not my thing. So, you know, maybe I shouldn't judge. One version of this, if we're not being snobs, one version of this is to say that there is a whole bunch of unmet need. There were, in some sense, genres that people didn't appreciate could exist and that were created by this.

And whether we think it's aesthetically good or not is a different question. We could talk about that separately, but I think a whole bunch of interests are being met by products that the traditional gatekeepers did not anticipate and kind of rejected for a while. That and there's clearly a lot of unhappy wives. You know, it's interesting to me what you're talking about in the book, because I watched the whole, you know, I grew up in the late 70s and 80s when some of the best, the best

music was ever created. And I shouldn't say that because blues and soul and jazz, I mean, that really, you know, the best music was ever created. Um, and, uh, and I shouldn't say that because blues and soul and jazz, I mean that, that really, you know, 50, 60, but,

but really when it came to like recording production, uh, and everything else, uh, that was a great time. And, and, and then I watched the Napster thing go down,

you know, I was, I'm a big Metallica fan to this day. So, you know, I remember the Lars, you know i'm a big metallica fan to this day so you know i remember the lars you know up there going um and but you know honestly there was a lot of interesting things even before digitization they kind of shot themselves in the dick in the music industry that drove consumers

to go fuck you um you know i don't know i don't know if you talk about this in the book but there was the paola that went on with uh with uh uh the one label m mci uh you know the rolling stones got to a point where they just admitted this total fuck you to consumers that we're basically going to make two hits on the on the uh on the album that are going to be radio and the rest of it's just shit and they just zoned it they just came out and said yeah that's that's what we're doing there's just and a lot of and a lot of a and r guys started promoting that sort of concept and so people got sick of it they're like why do we have to buy a whole fucking album when there's only two good songs on it fuck you guys so whenster came along in the digitization,

the payola scandal of, who was it, MCI? I don't remember. There's been a bunch of these. I mean, there was one going all the way back to the 50s, of course, but then much more recently this stuff has continued in various forms. This stuff's continued for a long time. I mean, even when it was illegal, there was a legal way for labels to essentially pay to get their music promoted on traditional radio.

I mean, there was this bottleneck. It was worth investing in getting it. And it's just part of this whole, in some sense, whether you view it as rotten in the sense of corrupt or just an inefficient system because they're guessing which songs we might like and they're usually wrong. And that's the whole choice we get. But actually, you reminded me of something that I want to take us back to, if you don't mind, talk about music quality. So we all have views about what's the best music, and frankly, none of us are wrong. But there are some ways to try to use data to see which music is in some sense most valuable to people or most used. There are a couple ways, and none of them is above reproach, but let me just

describe them a little bit. One is to look like what critics, critics have these best of all time lists or best of the decade lists. There's a famous Rolling Stone book, 500 best albums of all time. And there are lots of lists like that. And if you take those lists and you put the music back into the year when it was originally released and say, well, how many are from each year? It turns out, according to them, and frankly, if you also bring a bunch of other lists in there as well, it looks like 1970 is the high watermark for music quality. And then it falls. And it falls, and it's kind of stable through the 80s into the 90s. And then you have Napster come along in 1999,

and you might worry now that the amount of good music getting released would even collapse. But what actually happens is not that. What happens is the amount of good music getting released would even collapse. But what actually happens is not that. What happens is the amount of good music measured by what critics say stays pretty stable throughout the early 2000s. But here's a different way to think about it. How about what if you could have data on what people buy or listen to on the radio by year and when it was released. So what I mean is, say, for the year 2010, what if you knew what fraction of what people are listening to came from 2010 versus 2009 versus 2008? And suppose you had that for a bunch of years. What you'd see, because I have the data, what you'd see is that people use older music less than newer music, just because it's just

appreciation. Old stuff is, in general, not as useful to people as newer stuff. But after accounting for how old a vintage is, maybe some vintages get used more than others. And here's what you find if you look at that question. It looks just like what the critics say. It rises to 1970 and falls after that, and it's pretty stable up to about 2000. But then after 2000, and again, this is the year Napster, 1999 is when Napster comes along. As music industry revenue is collapsing, the apparent usefulness of the vintages released after 1999 starts to rise substantially. Now, that seems weird, but here's what's going on. There's a huge, because of the falling costs and

lots of the democratization of creation, there's an enormous increase in the number of things created. Now, a lot of it is not useful. Nobody buys it. Nobody listens to it. But there's some of this stuff that wouldn't have made it through before, but does. It ends up attracting a lot of attention. It may, you know, it's not that particular musicians or artists are better than before, but the vintages as a whole include more stuff that seems useful to people. Let's just put it that way. So that's my other kind of evidence of the digital renaissance. It's not just that the guys that wouldn't have made it through before now do and sell pretty well. It's also that the new stuff seems good to people compared to the

old stuff. I know the person I'm thinking of is Mariah Carey. Mariah Carey was dating and I think married at one point to the, to the guy. Yeah. And he pretty much, one of my favorite bands is Kansas and he pretty much took everybody that would had, it was cutting in the studio,

cut a record. And he said, you know, as soon as he got the records done, he was like, we're dumping all advertising and marketing and everything is going behind Mariah Carey. So basically, and then they went into this huge payola scandal with her material, even though some of it sucked. Tommy Mottola, that's who it was and uh so they just started doing this payola by buying the radio stations and everything and so i think that you know between the merger of the fu of the record labels and then like you say the digitization of napster where it's like hey we can democratize this music and everyone can get a hold of it. And we found ways to go around, you know, what the studios have done. And then it made, it kind of opened up this age of disposableness.

Do you talk in the book about disposability where, you know, we went from owning things to where we don't really own things anymore? Well, there is certainly this movement away from owning things and toward a kind of a subscription model. It's a Netflix thing. It's a Spotify thing. And it's actually, in many ways, it's a wonderful opportunity for both the buyers and the sellers. But one thing just to say, though, about this period between about 1999 and about 2003, you know, it is fun to sort of think back. 1999, Britney Spears is huge. Backstreet Boys. These albums are selling like more than anybody since the Beatles. But it's, but you're right.

There was a lot of consumer resistance because an album was 15 to $20 and it didn't have 10 or 12 good songs on it necessarily. And so one of the things that digitization allowed and both Napster, of course, allowed you to get individual songs for free illegally, but it took three years. Here was sort of the problem. It took three or four years for the music industry kind of being forced by Apple to provide a la carte sales of individual songs at 99 cents a piece. And those were four lost years. Now, to be fair, it's a pretty hard problem.

You're the canary in the coal mine. You're the industry seeing your whole source of revenue traditionally is being threatened by people who are stealing. And so your first thought is let's sue them or let's try to sort of take time back. There's a huge opportunity here. There's a huge opportunity if you can distribute things digitally. You don't need trucks, you don't need record stores, you don't need a whole bunch of costs. And once and frankly it took more than just the itunes music store for this to happen it frankly took spotify rhapsody had the idea earlier but it took spotify to really get adoption of the idea 10 bucks a month all you can eat now you own nothing

but it's all you can eat as long as you keep paying god i've been spaying i've been paying for spotify god for so freaking long, $10 a month. I probably, I don't know, maybe they've got more money. I was paying for Spotify back when you couldn't get into America, and I had to fake an IP address to get a subscription in Europe and do the whole Onion thing and whatever. It was just to get a prescription, a subscription. I wasn't like overthrowing

government. They haven't worked it out with the record labels yet. Yeah, but I was like, that's not their fucking problem. This has been good news though. Sorry to interrupt, but this has been great news for everyone because the last three years, finally, recorded music revenue

has risen substantially. It's still way below where it was, but it's not, you know, since there are no longer are such substantial costs, it's not even clear profitability is off, but revenue has risen by substantial fractions or substantial percentages for the past three years. And it's really being driven by subscription sales of music. So that's good news for, for Spotify.

It's also in principle principle good news for the artists as well and the labels. They seem to complain a lot though about what they're getting paid. And I think they just have to accept with the democratization, they were just maybe getting overpaid. Is that? Well, I don't know. It's hard to say what overpaid means, but I think one of the challenges is that they now face a lot of competition. Part of the competition is from stealing, and I think it's right. That's not fair. But then there's also just a lot more music out there. So there's more sort of – I mean, that said, though,

if you look at Spotify and the top – who's on top on Spotify, it's not as though consumption has moved sharply away from the top artists. The top artists are still doing extremely well. I mean, what's maybe new is that now there's a, there are a lot more artists can participate. Many artists who are kind of middle class, middle income artists are unhappy that they don't make a lot of money. But I think a lot of them to be fair, need to ask,

how would it be in the alternative world where only a few got signed period? I mean, it might kind of suck to only get paid a little bit but it might be even worse to not have the opportunity to release things at all yeah so it gives more space for different things like i remember when um i'm trying to think of the guy who really helped podcasting really get going um he was a big radio dj for a lot of years. He did love line and stuff. Uh, and he really, he got fired from the radio one day and they were like, what are you going to do? He's like, I'm going to do podcasts. He really built quite the little podcasting empire.

I used to listen to him. Um, and then, uh, you know, a lot of voices that you, you know, I mean, even me, I have a podcast, I'm not radio quality in any way, shape, or form. I probably would never be let onto a radio set. And certainly with the language I use. That's what's interesting. I mean, so the digital renaissance idea works perfectly for podcasting. I haven't studied podcasting, but lots of cool things are happening. I mean, so in the old days, there were a few radio stations per town, so there weren't that many slots.

So if you had, you know, imagine that you were of interest to lots of people, but not a lot of people in any particular geographic place, there's not a place for you in the traditional world. But there's, there is a place in the new world, if you can find a few listeners per county across the whole country, you might have an audience worth, you know, worth communicating to. And so that's another digital renaissance phenomenon yeah they in fact they got an offer from a radio station uh yesterday i think it was the day before and they want like 450 bucks an hour to put me on the radio they want me to pay i was like why i have an international audience right now i have a huge social media following that you know we publish to and we

can share it out and bang the crap out of it oh why why'd i pay you 450 bucks to go in there and then well if you get a sponsor i'm like yeah but still they'd have to pay you know like i can do that for free now and still get paid for what i do yeah um and uh and then i don't have to worry about like they were talking about going on somebody's radio station channel and i'm like what to the some local like I don't have to worry about, like, they were talking about going on somebody's radio station channel. And I'm like, what? To some local, like, I don't know, hey, Arizona, how's it going, Phoenix? I'm talking to the world in the Chris Voss show.

What are you doing, man? I never thought with the, like you talk about, the democratization of technology and stuff, being able to give us stuff, uh, inexpensively and make it so that everyone can use it. I never thought I'd have clients around the world. I never thought I'd sell around the world. Um, uh, being able to call around the world. I mean, our companies, we used to pay like $40,000 a month just for a long distance, you know,

12 cents per, I think it was the best deal we ever got. It was like 12 cents per minute or something. And I never distance, you know, 12 cents per, I think it was the best deal we ever got was like 12 cents per minute or something. And I never thought, you know, we'd ever reach this democratization like with Skype where I can just call somebody and it's just obsolete what it, what it costs over the internet. So the internet, the internet really was the, the internet and the, and the what would you call it? The broad adoption of the internet. I mean that most of the,

most of the phenomena here are really driven by that. It's digital technology, one form or another. I mean, think about, whether you think about music or movies, even, you know, what does it take to produce a programming and, you know, an iPhone has a pretty good music studio on it, garage band, you know, what does it cost to make cinema-quality movies? It used to cost an enormous amount of money. You needed film to rent Panavision cameras.

Now for a couple thousand bucks, you can buy a digital SLR that makes cinema quality. I'm not saying that's the main reason why Hollywood has it better, but that's the main reason why the kid who went to film school can make a movie that might turn out to be his or her ticket to uh to actual you know actual starring you know kind of career i remember when blair witch came out and they made it for like 12 grand or maybe no it was like 30 grand i think and then i think i saw some iphone videos they made for like five grand and uh i don't think they were successful as blair witch. Blair Witch just was stupid successful.

But, yeah, it's definitely – so it opens – this democratization has opened up more availability for better choice for consumers, would you say? For sure. I mean, just if you look at the number of products available, which is a rough measure of choice, the amount of new music brought to market tripled between about 2000 and 2010. The number of new movies has gone up by substantially more than that, although it becomes hard to even measure what a movie is. We have this notion that a movie is like one of those things released on a thousand screens. Well, there are about, there are about 150, 250 of those things released on 500 or 1,000 screens per year.

But there are hundreds, if not thousands, more movies created for direct-to-digital distribution. So there are a lot of movies that first show up on Netflix, first show up on On Demand, first show up on Amazon Instant. And there are just many, many. And then there are, of course, a lot of movies that aren't even really commercially real but this is the number of movies that you could go out and pay to see has gone up by something like a factor of five what do you see happening with uh i mean coronavirus right now is already driving uh theaters into bankruptcy and they were kind of on the edge anyway before that i mean anytime i went into a theater to see a really good movie, you know, I go in and I look around and be like, there's just us here, man. What do you see happening with that digitization?

It's super interesting. This one fits also well with my identity as a university professor. I mean, so there are digital alternatives to a lot of what we do. There are digital alternatives to going to a physical movie theater. There are digital alternatives to going to a physical classroom. During coronavirus, during the pandemic, we have been forced at most schools to deliver our education digitally. And similarly, movie theaters have had to close almost everywhere. And so people have to or choose to watch them via other means. I think studios are starting to release things directly to video or choose to, to watch via other means. I think studios are starting to release things directly to video, much to the chagrin of theaters. But here's the thing, I think, and I say this partly as a self-interested person in the ed biz,

young people do want to physically be together. You know, they want to interact with each other. A big part of college is social. And I think similarly, a big part of going to the movies for young people, not as much for old people, but for young people is a very social thing. So I actually think that once the pandemic is over, and let's hope that's really soon, that people will get back together at movie theaters. I mean, I think there's a permanent shift. You look at what people spend on their 72-inch screens at home and sound systems. A lot of people want to watch at home. Some of that, though, is not taken from theaters. It's taken from other forms of entertainment.

But I think that the enduring appeal of theaters and colleges will be that young people want to be together. And you know what's interesting is you talk about a renaissance of technology. You talked about that in the music portion. Now people are driving theaters and making a comeback. In fact, now there's churches doing drive-in theater for your church. There's comedians.

I think there's one of the famous comedians is going to do a comedy stage show at like a drive-in theater sort of experience. Yeah. Well, it's, it's, it's weird times. I'm on top of everything that's tragic,

we are, we're all pretty desperate to do something. So I get it. I don't know how much of that will, will survive. Some things will survive the pandemic, some new habits. I, you know, I have a romanticism to the drive-in theater. I grew up with drive-in theaters. I, I miss drive-in theaters. You know, there was something about being in your car. I unfortunately didn't go through the dating period with driving theaters uh people that are older might have some more romantic sort of experience with that but uh you know looking back i mean being able to sit in your car and enjoy your car and not have to listen to other idiots in the theater

kind of be nice especially in the digital age where people have phones and stuff um it is interesting and and we were talking about movies in fact there was a big movie it was an animation i can't remember if it was disney or not i think it was like milo some it was some animated movie that was released during the coronavirus lockdown and it did a hundred million dollars in sales and theaters freak the crap out because they were like holy crap we can be extinct and uh people adopt uh you're right with colleges um you know for a long time people wonder when colleges will make that transition and uh i mean yeah you do need to be in college so you can go there i mean you're trying to you're in the class trying to figure out which girl you know you can what she's

cute um but uh and then there's you know drinking and partying and stuff and there's some learning stuff too there is and actually we're working hard on on learning and and forms of active learning in class that we can't do as well online. But it is interesting, though, to be forced through this. We're all learning something. Yeah. So let me ask you this because I've been talking about a lot of this on the show. I think people are going to have a lot of these habits of consuming stuff electronically, and they're going to have a hard time clawing back.

Now, there might be some sort of renaissance, like you say, to going back to, I don't know, the romantic era of going to classrooms and stuff, but I don't know, what do you think? I think, so I think undergraduates, 18 to 21, 22 year olds, I think they're going to want to be together. Now, there's a separate issue, though, of, you know, using lower cost technologies as a way to provide services to people who hadn't previously been served. You know, and so and that is a real issue because we have a lot of income disparities across the country and a lot of people aren't properly served by these markets. But I think, you know, look, as a society in general, we've gotten a lot richer over time. You could almost think about certain aspects of the undergraduate educational experience as these long-term luxury goods. I mean,

a generation ago, major state universities had a lot of commuters who lived at home and just came to the campus for a day. And now as families have gotten richer, most of these kids live on campus or they live in apartments. And so the point is, as society gets richer, it wants a kind of a better experience, a bigger, a richer experience that involves both educational and social aspects for its kids. I mean, at the same time, though, these lower cost technologies can and should and ultimately will make it possible for more people to get access. I mean, my favorite example there is not college, but, you know, Khan Academy. Those Khan Academy videos freely available to any kid anywhere or any person anywhere, frankly, are a great way to educate oneself. I mean, they're good to help you with stuff you're confused about at your school, whatever level of school. So it's an interesting digital, you know, example of digitization, making education available to people without the social aspect, but with a lot of the other aspects in it.

And I don't know, you know, I know it's going to be interesting to see. The other thing we're going to be running into is something with costs and stuff. I mean, we're going to be in a dark, I don't think always in a dark place, but I think we're going to go through another dark decade of clawing back economy-wise from this great recession. And I think a lot of more stuff is going to become dispensable. I mean, I see a lot of people together now that are on Zooms and that becomes a social thing. A lot of my friends who used to, you know, they used to hang out with the girls,

they hang out on Zoom now and that's becoming the thing. And so it will be interesting to see how long this coronavirus thing goes on, how long we have to socially distance and whether we bounce back to it from our old norms or whether we get so spoiled, we continue on with like, well, fuck it. That's the way it is. Yeah.

Well, I mean, think about air travel and all the travel people do for business and business, especially. I think, I think we've all learned that we can do a, I mean, travel is quite nice and can be quite useful, but we, there are a lot of things we used to do via travel that we can do a lot. I mean, travel is quite nice and can be quite useful,

but there are a lot of things we used to do via travel that we can do pretty well via Zoom. Pretty well. Yeah, it's interesting to me. And I do a lot of events or used to do a lot of events, let's put it that way. And now, you know, people are trying to do these virtual online things, and they're never quite the same. They I mean, I just have zero interest in participating in online events. And so I want to see those come back.

And it looks like so far they're a bomb. But, yeah, it's interesting how our world is going to get shaped to more technology and whether or not habits are going to stick or not and whether or not going to make a difference. I mean, uh, years and years ago, I remember hearing the popcorn lady, I forget her name, uh, but she would run all the books on popcorn and business and stuff. And, and she said, more and more people are, people are, uh, are retreating into their homes and they want to stay home more and they want to do more and we're going to see more and more technologies that are geared towards them and you're going to find the consumer wants to be at home more you know they don't want to be out and about they

don't want to and i used to spend like i remember i used to spend four to six hours a weekend at the record store looking through records right tapes and you know now i can spend i don't know an hour or two going through uh spotify and then the beautiful part about spotify is it's data driven as opposed to you know uh mariah carey and her husband uh payoling me right no personalized recommendation i mean it's amazing if you think about uh the old the old days you look in the in the listings in the newspaper for the movies that are playing at theaters near you. Big city, maybe it's 25 movies, maybe more if you're in a very big city. And, you know, what number of songs you can listen to.

If you're willing to wait, you might hear, you know, over a number of hours, you'll hear 25 different songs on your local radio station. You have your own record collection. It's different. But now, as you say, Spotify has millions, like 30 or 40 million tracks available, probably most of them terrible, but probably 5 million are pretty good. And they have then go downstairs to your television, and there you have access to,

whether it's through Amazon Instant or Netflix or a variety of services, literally thousands of movies and television shows. I mean, the amount of variety without leaving the house, just, just the worst, whatever we used to have access to.

Yeah. I mean, it's, it's crazy. The different media and stuff that we have and what gets consumed. Like, I mean, I can spend hours at night.

I go to bed and I've, I've developed a bad habit lately where i go to bed at night and i'll flip through tiktok and then suddenly three hours ago by and i've been up half the night and i think they're done in one minute bites uh so you know that's my netflix um i know other people that are doing netflix but i love spotify is great because too if you one of the things i used to have a hard time was especially when i was a kid you had 10 bucks or 12 bucks to buy an album or tape um and you know that was that was like your hard-earned money and you had one shot to blow it on an album and if you bought an album where it was like the rolling stones who'd who'd done two hits on it phoned in the rest of the album, you're going to be hating yourself 45 minutes later.

And so now you can go on Spotify. And like if I discover somebody new, like every now and then somebody will be introduced to me and like, hey, check out this artist. And I'll be like, okay. And you can go right to Spotify and you can see the most popular songs for them. So instead of going to like the shitty tracks of them, the B sides, maybe,

um, you can go right to the best ones and go, Oh wow. I really like this person. Oh yeah. I don't like this person or something along those lines. So, and it's,

it's amazing. If you think about the old days, the only way, and then my old days, now I'll be referring to 2003, the old days, the only way, and by old days now, I'll be referring to 2003. The old days, you could buy a song if it was worth 99 cents to you. So let's suppose you're not going the stealing option, you're going the buying option. So any song that you're pretty sure you're willing to risk 99 cents on, you could buy. But the songs where you think, I'd kind of like to hear that, but I'm not willing to pay 99 cents, maybe I'd pay a nickel. You don't

get to have that song unless you're willing to steal. With Spotify, if you think about all the songs you might want to listen to, this one I'm willing to pay a penny, this one two cents, this one 45 cents. Add up all that willingness to pay across all the songs and compare that to the $9.99 they charge per month. The point is Spotify is able to get – they're able to charge you for your curiosity about the songs. You're not sure enough that you'd pay 99 cents for.

And that's a beautiful thing. It means that you get all these songs that you thought you were willing to pay a penny for. It turns out they're great. Some of them aren't, but some of them are, and they get, they get to charge and get revenue,

which they share with labels and artists from, again, your kind of curiosity as opposed to just the artists you're certain about. It's really a win-win arrangement. And there are months that I've gone by without listening to Spotify. I mean, there are little months that have gone by where they've gotten their $10 and I only use the service. Well, that's good for them.

Yeah, I guess. I mean, I don't know. Unless you stop subscribing. I don't think it costs them to spin it unless they spin it or mean, I don't know. Unless you stop subscribing. I don't think it costs them to spin it unless they spin it or something. I don't know. So maybe it's just pure profit for them. I think there's an element of that. They do pay for streams, but yeah. So what are some other elements of your book that you want to talk about? Well, so another fun thing to think about is kind of the globalization part of this story. You know, there's long been a concern about American and English language movies and music kind of dominating the world.

And it's also been intertwined with technology, even before digital technology, even going back to the 1990s. The French were very concerned, you know, as the internet started to appear, as MTV, you know, was growing, that technology would force American culture on them, American movies, American music. And it is true, our movies are extremely successful around the world. We have a really huge market share. But that's all just setting the stage for now what happens when it becomes cheaper. We've already talked about it's how it becomes cheaper for everybody to release their products that includes everybody around the world and so artists in norway artists in sweden artists in belgium everybody can release their movies and music and for one thing it's cheap enough to make stuff that you can make things adapted to your local society but it's also also the case that now, even though a Belgian

artist was not going to get his or her music into American record stores 20 years ago, that music is on Spotify. And so you can discover those artists. And even if it's a very small share of US consumers who are listening to Swedish music or Norwegian music, that could be a big deal as an export product for them, for, you know, a small fraction of a huge rest of the world to be interested in their stuff. So it really is another way in which digitization is sort of empowering David against Goliath, where these Davids now are not just little people, but little countries. And so Davids can come out of nowhere and then suddenly, you know, become the next Justin Bieber or, you know, anybody. It's interesting to me.

You've got to talk about Dance Monkey. Dance Monkey or Baby Shark. Baby Shark, remember, Baby Shark is like so popular, and I don't know where that came from. What was the other popular YouTube video? Oh, the Korean, the Psy? Gangnam Style. Gangnam Style? Gangnam Style?

Yeah, he got a billion plays. I think they had to reset the counter on YouTube or something. Yeah, it was like some crazy thing, and it just came out of nowhere. And people, you know, that's the biggest thing everyone always asks me. Like, I want to do something to make it go viral. And it's like, dude, that takes like takes like you know an act of miracles gods yes aliens like i you know i don't think i don't there's very few people that can make stuff go viral without spending a huge amount of money behind it and an army of stuff in fact um sometimes

it's it's a bit subversive in this marketplace. So the other thing, I just say one other thing, and then I'll stop about this. But a lot of the stories here are stories about sort of good news for David, as opposed to Goliath, where Goliath is the traditional big players, the traditional record labels or studios. But there are other aspects of digitization that are good news for Goliath, too. I mean, one was that business of subscription selling, but another is this whole, what you might call the minor league farm system. So now it's possible

for an artist to put something on YouTube or on somewhere and for people to see it. And for these traditional intermediaries to see, oh, that's getting a lot of views, a lot of downloads, a lot of listens. And then they know that they can go ahead and invest in that guy with much less risk than they traditionally did when they traditionally took unsigned, unknown folks and bet on them and were usually wrong. And so this is good and sometimes good news for everybody. It's possible to know a lot about your artists before you sign them because they have some kind of minor league product and you can see how popular it was one thing that's interesting is i saw i've

seen the perversion of it to where the um and yeah i've seen on more than one platform actually but it used to be when i joined youtube youtube was the people who decided what was trending was the people and they would just follow you know the people do popular you know i can make a video and it would it would go popular and you're just like hey cool man you know, the people do popular, you know, I can make a video and it would go popular. And you're just like, hey, cool, man, you know, lots of money off that. And Facebook was the same way. You could you can make a post and like suddenly just everyone's talking about that post. And then they perverted it to where they basically pulled the Mariah Carey stunt where they started perverting the trending things on YouTube and they started, you know, doing payola and who was paying advertising. And you'd be like, Hmm, it's kind of weird. It used to be all the popular people were on YouTube, but now like, Hmm, somehow all the movies that are launching are the trenders on YouTube.

Yeah. That seems like someone paid for that. That has an interesting analog. You know, if you think about Spotify, one of my favorite platforms to talk about are Netflix. So, so take,

go, go back in time and think about music industry used to have, um, lots and lots of record stores that were independent and lots and lots of radio stations that were making independent decisions about what to play. So there were really thousands of gatekeepers and it was even, it was considered a big deal when Walmart came to maybe have 20% of the retail market. Oh my goodness, it's somebody has too much power. Nowadays, basically Apple Music and

Spotify, the two major non, two major interactive streaming services, they are both the radio station and the record store, because that's where the revenue is generated by plays. They also are the radio station in the sense that they decide what to play in the following sense. I mean, although you can go and listen to whatever you want, their playlists that do account for much listening are curated by them. So they have an enormous amount of power to determine what you get exposed to and what you listen to. Now, as far as I can tell, and I've studied this a lot, they're not really doing things that are pernicious. But if we were worried about how much power Walmart had 20-some years ago, we should be really very concerned about how much power is in the hands of a small number of decision makers. Again, I don't see pernicious behavior. And I

studied this pretty carefully. But it's interesting. It's really interesting how much power there is in a few hands. You saw that with Amazon, too. I mean, my friends who write books are like, you have to start and you have to use Amazon's system if you want to be successful on Amazon, basically. It is super interesting because in the old days, you wrote a book and the standard contract gave you like, what is it, like 8% of cover price or something like that with amazon if you self-publish a book you get essentially um you know two-thirds of the of the price as your revenue which is a fantastic

royalty deal on the other hand they don't promote it for you well at least they don't promote it for you so in some sense amazon's giving you an apple or giving you great deals in some sense why do i have to pay that much for for passive hosting of my of my stuff so it's an interesting paradox exactly and youtube destroyed like one of the fun things used to be used to be so fun to go on the trending on youtube and you could see stuff and it was very democratized because it was just data-driven, and they started screwing with it, and they started trying to, you know, when stuff would trend, they'd be like, well, let's give this guy more because he seems to be doing something.

And, you know, maybe he had one funny video that was a one-off, but then they started sending more people to him, and they started taking from everyone else. I saw the same thing with Facebook where like I say, Facebook, you could trend, you could, you could, you know, uh, you could get a lot of people seeing your stuff and they started manipulating partially because they try and extort money out of the news people. Um, you know, even now I complain about on Facebook where if, if I own a web, if I own a fan page on Facebook for like the Chris Voss show, I can't put the Chris Voss show posts on like, you know, for this, you know, it's going

to go on the Chris Voss show fan page. But if I put the link to this, the chrisvossshow.com on my personal page, I want to share with my friends and say hey check this out they will not share it they bury it like it does not show up same thing with youtube links same thing with twitter links and i think they're figuring out on tiktok and so they took away that democratization because they're like hey we know that you can pay us so we're going to force you to pay us if you want your friends to see it and it really ruined what was going on and actually gave rise to the sort of issues we're having today with, you know, with the posts that do rise, have a low intellect to them, but have a high emotional volumetric to them. And now we've got, you know, people doing QAnon and, you know, what was the virus movie? I forget the Vandemic or Pandemic or Pan, I don't remember. It was the virus movie that went crazy. And so, you know, this manipulation

is the re-manipulation, I guess, of the digitization. It's kind of interesting. Yeah, I mean, this is really the reflection for these contexts of this whole larger question of the concentration of power in a small number of actors, whether it be Apple, Amazon, Google, Facebook, Microsoft, you know, a lot of these digital markets, although I tend to be pretty positive about them, calling the book Digital Renaissance, the threats here arise from a small number of players ending up controlling a lot of decisions in these markets. And so it's really important for us to keep an eye on that. As I say, I have been keeping an eye on Spotify. I haven't seen bad behavior,

but I think we got to keep an eye on all these guys because so much power is concentrated right now. Yeah. I mean, for a a while there apple kind of held the corner and then spotify you know snuck up with all their stuff um i spotify has been incredibly fair and hungry to me um during the rise of podcasts they were really hungry like they would approve every new podcast they had within like minutes um and yet you know apple would apple still takes three to five days uh google takes like a couple days to get your thing approved pretty much everybody else is uh you know takes their time but spotify would be like we're on it man um but uh i don't know maybe we maybe this is something we have to start raising flags out marching for a right for democratization

from these platforms. We're certainly seeing that with Facebook right now, where the advertisers are striking and going, hey, you know, we want fairness. And, you know, they're kind of running in the monopoly of Facebook and Mark Zuckerberg, who's like, I'll do what I want. Yeah, no, I think we are seeing some discussion of this. It's been eclipsed by some other recent issues, but certainly in the last year, we've seen a lot of politicians in both sides of the aisle, frankly, talking about some of the dangers of,

of concentrating a lot of power in the hands of a few platforms. Yeah. I miss the days of Google plus. And I mean, there was a whole, there was a whole series of time there where we were going through what, what they called Facebook killers. And, you know, so it was always keeping Facebook on edge and on the ropes of like, well, somebody else is after us.

You know, Google Plus was after Facebook. It was hard. But then when Google Plus collapsed, you know, Facebook was like, hey, man, we're the only game in town. And that's kind of their attitude. I think they've actually kind of said that. Mark Zuckerberg has kind of said that over the recent comments he's made about the boycott. But maybe that's important. Maybe that's what we need to understand as a population, that we need

to start voting with our fingers on our iPads and our phones and stuff. Yeah, well, at a minimum, don't believe everything you read. Well, there you go. But you know, I think, I don't know, maybe consumers are doing that now because like you see the rise of Tik TOK right now. And I mean, Tik TOK is just taken off, stupid, crazy. And, and it's out of Facebook's hands. We saw that with snapchat where uh mark zuckerer was trying to buy snap and then they made instagram and or bought instagram um and uh there's always like a new shiny object that gives rise like and it's just what you talk about digital

renaissance where where um you know we can we can march away with whatever the new shiny thing is. One of the favorite business school case study examples is MySpace. So it's supposed to be hard to unseat an existing network player because, after all, I'm on MySpace because all my friends are on MySpace. So if I leave MySpace and I go someplace, none of my friends are there. So it's supposed to be impossible for a MySpace to be replaced. And yet it did get replaced by Facebook. And so this is, I think, in some sense, the favorite example of these big platforms.

The guys are like, oh, you know, competition is a click away. We could become not powerful in a second. Don't worry about us. Pay no attention to the man behind the curtain, that sort of thing. Most definitely. It's pretty interesting. Anything more we need to know about your book, Digital Renaissance, available from Princeton University Press?

We've covered it nicely. I encourage people to check it out. Hope they enjoy it. Definitely so. You need to understand the powers that are moving this market. And, of course, it's going to be interesting to see the future of popular culture, as you talk about in the book, where things are going. I mean, that's usually what my friends and everybody in technology

were sitting around going okay so here's where we're at what's the future and you're seeing so much of its shape by technology uh even the automotive industry you know i mean what what uh what they're doing with tesla and, what they're doing with SpaceX. You know, that alone was the democracy of space exploration. You know, it used to be you had to have a, you know, government contract and be NASA to be able to launch stuff into space. And, you know, now he's doing it for what? I don't know, $100,000 per rocket thing or something for the recycling of it. But it'll be interesting to see what the future brings

and it'll be interesting to see what industries are disrupted. And, uh, uh, you know, this, these last 10 years have been an incredible disruption of so many different things, so many different industries, so many, so much brick and mortar, um, that have gone completely online. I mean, I, I couldn't have the chris foss podcast if i had to find my way into radio djs um and you know i'd have some you know anr guy or some dj radio guy or some some program manager going uh chris you know you had a couple shitty episodes you kind of phoned in uh yeah man we gotta let you go because you're not just not pulling the sound system i remember when uh who was it it was when uh serious radio rose that was

kind of an interesting time too when you saw howard stern leave radio and go to satellite that was kind of crazy yeah that's like a half step toward this because so many more stations relative to what you have in any market on satellite. Definitely. In fact, I'm surprised he stuck with it that long. I'm like, seriously, people still paying for that? It's crazy. Well, Joel, it's been wonderful to have you on. Everyone go check out the book, Digital Renaissance. You can get it on Amazon. And Joel, it's been wonderful to have you on the show. Anything, any last words you want to throw in there? No pleasure to talk to you.

So do it again sometime. All right, let's do it. Uh, and check out his other books that he has. Uh, he's got two other books you can find on Amazon as well. Screw genomics and tyranny of the market. Uh, if you want to do a plug on these, the wastefulness of holiday gift giving, is that just because the people you give the gift to are horrible people and didn't deserve it?

No, you know, so here's the deal. Here's the super quick blurb on this. You know, economic theory is all about people making good choices for themselves. I know what I want, so I buy what I want and it's worth what I pay for it.

When I'm buying for you, I spend a dollar or let's say I spend a hundred dollars to buy something for you. It turns out it would only would have been worth 25 to you because25 to you because you already have it or it's the wrong size. It's just gift giving, as wonderful as the intentions are, subverts all the efficiency of the economy. Because I'm making decisions without knowing what you want or what you need. It sounds like every gift I've ever gotten for Christmas. It rings true for most

people. There are sentimentalists who hate me for saying this, but let's not admit it. These are wonderful thoughts, but terrible choices. I've gotten gifts over the years where I look at my friends and go, you don't have any clue who I am, do you? You don't know me. And then your tyranny, the market, what was that? The markets deliver what large groups like you want to throw a blurb in there for that one? Yes, I'll try it. So, you know, the story there is that in what we teach in economics classes is that if you leave markets to themselves, everybody gets what they want. You know, if you want a green tie, I want a blue tie. We each get what we want. It's all perfect. It's like blockbuster, go home happy. The problem is a lot

of products don't quite work that way if I want it To be a certain way a bunch of other people also need to want it to be that way for it to be provided that Way and so maybe my favorite example or a pretty good example is like the old-fashioned daily newspaper There's one per city and so if there are a lot of people like you it's gonna appeal to you And if you and I don't share the interest in the same things, it's going to be appealing to you and not to me. So the point is, yeah, you get what you want. If a whole bunch of other people also want it, which in some sense isn't surprising, but it's not at all the basic lesson that economists say to people when they also say, don't worry, markets will take care of everything for everyone.

Well, maybe that's what led to your third book, The Democratization of All That, so that everyone could get what they want. No, you're exactly right. I mean, so the digitization reduced all those costs. So now everybody is getting pretty much what they want, music, movies, and books. Most definitely.

Well, thanks for being on the show, Joel. Thanks, Moniz, for tuning in. We certainly appreciate you guys. Be sure to refer the show to your friends, neighbors, relatives, dogs, cats. Get them involved in the show. Hell, leave the show on when the cockroach is around so they have something to listen to. You know, it'll either kill them

or it'll make their brains bigger and they'll get smart and move out of your house and, I don't know, get their own house. Okay, so we certainly appreciate you guys being here. Be safe. Wear your masks. We'll see you next time.