Angolan arbitrage

Wikimedia and Facebook have given Angolans free access to their websites, but not to the rest of the internet. So, naturally, Angolans have started hiding pirated movies and music in Wikipedia articles and linking to them on closed Facebook groups, creating a totally free and clandestine file sharing network in a country where mobile internet data is extremely expensive.

Here is more, via Kevin Burke.


Well, that is a twist - normally, this web site is vigorous in suppressing even the idea that overpriced items like movies or textbooks can be found for free on the Internet.

We sure are thankful to have you around to tell us which items are overpriced and which aren't. It is really valueable work. Please keep it up.

Yeah, I mentioned that films from a certain country could be found on a certain list at a certain website, and that some other torrent website was still functioning, and the post was removed. His right to do so ... and I absolutely understand that this is a principled position for many people.

Like, why is it that movies and books cost more than ever, when their marginal costs of marketing and retailing are lower than ever, and fixed costs can be spread across a larger audience than ever? I don't like putting money in the hands of monopolists, or even in the hands or those who strongly exert their market influence.

" I don’t like putting money in the hands of monopolists, or even in the hands or those who strongly exert their market influence. " Then simply don't purchase the product. You don't have to steal it, simply do without.

Because of market value. Seriously, dude, BUT IT COSTS LESS TO MAKE says not a damn thing about its market value. This is baaaasic econ.

No, Nathan makes a valid point. Given that technical advances and economies of scale are making the per-unit production cost cheaper, why are there not suppliers entering the market and exerting downward pressure on the price?

Middle men. Who have lower costs than yesterday's middlemen but more control over the market.

I'm not an anti-middle man kind of guy. It takes a lot of work to get stuff from A to B. Except for when it doesn't.

What do you think the price to buy a movie or book online would be if competition were mandatory, and you had 100 middlemen competing with a similar offering, not allowed to merge, as compared to the status quo?

I don't mind putting money in the pockets of content producers at all. But with present technologies it really bothers me how much ends up in the hands of people who have nothing to do with producing the content, and who basically don't even market the book - all they do is have a listing service for which the earn huge profits, largely resulting from explicitly (well, implicitly) anti-competitive measures through product pairing where there is no technological ability to shop with the competition.

Econ, yeah. Infinite firms and infinite consumers, supply meets demand. Well, for practical purposes, only the "infinite consumers" part applies. They will milk us for every penny they can get, and that's what econ tells us.

The "market value" taught in early econ is the cost of production plus a risk-adjusted (not so early econ anymore) rate of return on capital. The middlemen would not always be buying up any competition that enters the market if they did not anticipate being able to exert influences on "market prices".

Not sure it's quite the right place, but the "knowing the price of everything and value of nothing" comes to mind here. Don't mean to imply that you know the value of nothing, but the cliche phrase might be instructive, considering your faith in markets (which serve us well in many ways).

I wonder about the "naturally". What's the download/upload rate using 2G/3G mobile network? The file-sharing solution in Cuba seems to be more natural, carrying physical USB drivers is more efficient that trying to download several GB of data over mobile network. Without symmetrical connections, it becomes almost impossible to upload a big file using a mobile network.

Actually for most intents and purposes, most of the Internet is distributed most of the way on the sneaker net. For major CDNs its often cheaper to push content to edge servers by shipping hard drives than by sending it over the the major backbones. For example, if you're watching Netflix in Orlando you're probably streaming from a Cloudfront server 200 miles away in Jacksonville, with a video file that was Fedex'd 3000 miles from Los Gatos.

For Facebook this seems like a feature not a bug. There are fixed costs involved in 1) learning the strategies to find illegal content on a particular website and 2) finding the community that shares the illegal content you want and in the formats you want. This means that even as Angolans get higher access to broadband at lower cost I predict a strong degree of stickiness with Facebook for illegal content sharing (unless FB gets much much better at ferreting this sort of thing out).

Of course this is just a special case of the reasons Facebook inspires stickiness in the first place (and the reasons it provides free internet access to begin with) 1) On Facebook you'll know how to find things you like (friends, celebrities, news), and 2) the community of interest to you is on Facebook.

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