Economics and the mid-life crisis have much in common: Both dwell on foregone opportunities

C'est la vie; c'est la guerre; c'est la pomme de terre . . . . . . . . . . . . . email: jpalmer at uwo dot ca

. . . . . . . . . . .Richard Posner should be awarded the next Nobel Prize in Economics . . . . . . . . . . . .

Friday, July 22, 2005

Beethoven and the Beeb;
economics and the assessment

I noted in an earlier item that BBC3 had all nine Beethoven Symphonies available for downloading at no charge for a limited time. The Guardian has an assessment of the experiment, which is generally positive [thanks to JJ for the link]. There are several items in their assessment that are confusing, though.

Roger Wright, the controller of Radio 3, said it was "clear that people had been coming to Beethoven for the first time" through the Beethoven downloads. This was discernible from the fact that the symphonies nos 1 and 2 had a high take-up compared with no 3, the Eroica, a much more famous work.
I usually miss something, but how do these data support this conclusion?

Beethoven's downloads
1 Symphony No 6 (Pastoral): 220,461
2 Symphony No 7: 185,718
3 Symphony No 1: 164,662
4 Symphony No 9 (Choral): 157,822
5 Symphony No 2: 154,496
6 Symphony No 8: 148,553
7 Symphony No 5: 139,905
8 Symphony No 4: 108,958
9 Symphony No 3 (Eroica): 89,318
Total: 1,369,893
The real reason Symphony #6 had the most downloads because there was a great deal of hype and publicity about the programme before Symphonies 6-9 became available, but after Symphonies 1-5 were no longer available. I'd guess that Eroica received the fewest downloads mostly because fewer people were aware of the availability of the downloads when it was up.

And put this in the remember-demand-curves-are-downward-sloping book:

To put another perspective on the success of the Beethoven downloads, according to Matthew Cosgrove, director of Warner Classics, it would take a commercial CD recording of the complete Beethoven symphonies "upwards of five years" to sell as many downloads as were shifted from the BBC website in two weeks.

... Mr Cosgrove said: "I would be worried if the BBC repeated the experiment. We would take an extremely dim view if it happened repeatedly." But, he added: "It's caused quite a bit of controversy - but it has also provided us with an amazing piece of free market research. I don't think anyone had any idea in their wildest dreams that there would be this level of response. Yes, the downloads were free - but if charged at a commercial rate that would have been a huge amount of revenue."
Yes, Mr. Cosgrove. And if charged at a commercial rate, there would not have been nearly as many downloads. What is the price elasticity of demand for Beethoven Symphony downloads as the price goes above zero? I expect it is fairly high.

Digression: JJ, who sent me the Guardian piece, offers this brilliant insight:
Nothing personal, but I think it's completely nuts that British residents are paying for this service. Utterly barmy. Maybe the BBC should just send £10 notes abroad instead.
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