Changing music

A number of earlier postings have focused on the impact of information technology on the business of music. Now Alex Ross, music critic for The New Yorker, has written a wonderful summary of recent books about the impact of information technology on music itself: “The Record Effect: How technology has transformed the sound of music.”
The article is an enlightening description of how the art and craft of music changed because of recording technology, starting with John Philip Sousa prediction that recordings would lead to the demise of music.
I found the discussion about recording versus live performance especially interesting – including the following passage about the decline the concert experience:

In 1964, Glenn Gould made a famous decision to renounce live performance. In an essay published two years later, “The Prospects of Recording,” he predicted that the concert would eventually die out, to be replaced by a purely electronic music culture. He may still be proved right. For now, live performance clings to life, and, in tandem, the classical-music tradition that could hardly exist without it. As the years go by, Gould’s line of argument, which served to explain his decision to abandon the concert stage, seems ever more misguided and dangerous. Gould praised recordings for their vast archival possibilities, for their ability to supply on demand a bassoon sonata by Hindemith or a motet by Buxtehude. He gloried in the extraordinary interpretive control that studio conditions allowed him. He took it for granted that the taste for Buxtehude motets or for surprising new approaches to Bach could survive the death of the concert-that somehow new electronic avenues could be found to spread the word about old and unusual music. Gould’s thesis is annulled by cold statistics: classical-record sales have plunged, while concert attendance is anxiously holding steady.
. . .
A few months after Gould published his essay, the Beatles, in a presumably unrelated development, played their last live show, in San Francisco. They spent the rest of their short career working in the recording studio.

Ross goes on to decry the death of concerts as a blow to art. He does not go on to describe how this latest wave of IT – file sharing of digitized copies – may be leading to a return to the concert tour. That is something that his New Yorker colleague James Surowiecki wrote about just a few weeks earlier in “Hello Cleveland” (see my earlier posting “The new music industry“).
Surowiecki’s argument about the return of touring is clearly true in popular music – because it is being driven as much by the artists as the fans. It remains to be seen whether classical music will
(and can) move in the same direction. Some months ago I posted a piece on how the San Francisco Symphony is gaining a strong following (The innovative organization – not what you think). But I have no real evidence one way or another.
The old cliche is that technology changes everything. If in fact concerts are the new wave of the music future, another cliche might be more appropriate: the more things change, the more they stay the same.

Trade theory doesn’t always work

Surprise, surprise, surprise. Economists are finding that classical trade theory doesn’t seem to explain what is happening (or not happening, in this case). As a story in the Wall Street Journal, “Why Dollar Can’t Close Gap” explains:

Economists, puzzled that a weaker dollar hasn’t done more to shrink the U.S. trade deficit, think one reason may be the growing flow of goods moving between the foreign and U.S. divisions of large multinationals.
Forty-two percent of all U.S. trade in goods, $950 billion last year, occurs between arms of the same companies, including U.S.-based companies trading with their foreign divisions as well as foreign companies trading with their U.S. arms. Nearly 90% of U.S. imports from Ireland are such “related party” trade, as are 74.6% from Singapore, 62.1% from Germany and 61.1% from Mexico.
“When so much of trade is related-party moves, the determining driver is demand in the U.S., not shifts in exchange rates,” says Joseph Quinlan, chief market strategist of global wealth and investment at Bank of America.
. . .
Economic theory says that as the dollar declines, the trade balance should shift in the U.S.’s favor, usually with a delay of about 18 months after the currency starts moving downward. But it has been more than three years since the dollar started its slide, although it has recovered some ground recently, and there is little evidence of a significant impact on trade.
. . .
Gary Hufbauer, an economist at the Institute for International Economics, says companies with factories around the world, in theory, should be quicker to respond to shifting exchange rates because they see more immediately where it is cheap to produce and where the markets are strongest. But, in fact, he says, this isn’t how it works in practice.
One reason is that in large markets like the U.S., with many competitors, companies that import products are competing with domestic producers who don’t face the same pressure from the latest currency swings. As a result, importers are hesitant to raise prices to offset a falling dollar, because that would likely cut into market share, says Mr. Hufbauer. That, in turn, short-circuits one of the main ways in which a falling currency is supposed to curb imports.
Moreover, all producers face large fixed costs, regardless of where they build their plants, especially in industries such as autos and electronics that increasingly rely on advanced production technology and costly distribution systems. These companies are more inclined to choose production locations around the world and set prices according to competitive conditions in each market, rather than currency rates.

Seems like it isn’t your grandfather’s Ricardoian trade world any more.

Sweden changes its law

An update on the earlier posting on file sharing, Movie piracy – China, Russia . . . and Sweden. This story from Reuters.com

Sweden’s parliament approved a law on Wednesday that bans the downloading of copyrighted material such as films and music from the Internet after being singled out for criticism by Hollywood.
Sweden had until now allowed downloading of files, while uploading, or putting material on the Web, was illegal.

Interestingly,

The new Swedish law allows people to make one copy of a CD for personal use and to make copies of newspaper articles.