Another Journalist Duped by Robert Levine's Distortions?

Another journalist has fallen victim to the illogical arguments of Robert Levine ("How Digital Parasites are Destroying the Culture Business"). Readers of this blog may recall that I've previously pointed out some of the many problems with Mr. Levine's grandstanding and his book, Free Ride.

They are not hard to spot.

Still, in a January 20, 2012 The Globe and Mail review of Free Ride, Paula Todd, a lawyer who teaches journalism (and should know better), becomes yet another victim of Mr. Levine's glib line of BS - without even pausing to consider the obvious sophistry that underpins Free Ride.

For example, one of Mr. Levine's favorite arguments is that YouTube is built on "pirated' Saturday Night Live clips. As recounted by Ms. Todd in The Globe and Mail: "In 2003, for example, NBC delivered an $800-million (U.S.) profit to its owner, General Electric. Just seven years later, the network was looking to lose more than $100-million."

Wow. A $900 million dollar swing!

According to Mr. Levine (who Ms. Todd quotes uncritically), "while viewers were busy downloading Saturday Night Live from the Internet, Google was poised to buy YouTube for $1.65-billion."

Wow. Google bought YouTube because they wanted to get their hands on all that money that rightly belonged to NBC!

Terrible right?

Not exactly.

Because, to suggest, as Robert Levine does (and Ms. Todd credulously repeats), that "piracy" is the cause of what happened to NBC between 2003 and 2008 is patently absurd.

Are Ms. Todd and Mr. Levine aware of the landmark events in NBC history that account for the drop in profits between 2003 and 2008? For example, Friends ended in 2004 (and with it NBC’s lock on “must-see-TV” ad revenue) and the network struggled to breakeven on the Chinese Olympics in 2008 (having paid billions for U.S rights to the Olympics through 2012).

How about the problem of comparing apples to oranges?

Do Ms. Todd or Mr. Levine realize that NBC Universal was formed in May 2004 by the merger of General Electric's NBC with Vivendi's Vivendi Universal Entertainment and that profits at NBC Universal were depressed in 2008 because of a string of flops in its movie business (No movies in the top 10 of 2008, but many clumped at the bottom of that year’s barrel including Leatherheads, Definitely Maybe, Changeling, Death Race, Welcome Home Roscoe Jenkins)?

Finally, if we've reached the breaking point where "hijacking content that someone else paid to create deprives content creators of the cash to make more of it," why does TV ad revenue continue to grow? Over the 2003-2008 period MagnaGlobal reports worldwide TV ad revenue grew from $122.5 billion to over $155 billion. Mr. Levine describes a world where TV advertising revenue has been crippled by the internet, instead of the real world where TV ad revenue continues to grow (Deloitte predicts over $200 billion in 2012) as the world becomes more wired.


Mr. Levine's over-the-top obsession with "digital piracy and greedy technology firms" make him a lousy standard-bearer. This is a genuinely disruptive time, but content creators deserve a better champion. It's just too easy to knock down many of Mr. Levine's arguments with facts (even if Ms. Todd was not up to the challenge).

Content-creators need to be compensated in the New World - and enterprise-level "piracy" is a real problem. Robert Levine is 100% right about that. But I fear that Mr. Levine's hyperbolic distortions (and his attacks on people who are engaged in good-faith efforts to find a New Way) do more harm than good. Paradoxically, Robert Levine and his absurd claims may be an obstacle to getting content-creators compensated in the New World of digital connectivity.

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