Economics Lesson for eMusic

Paul Brown @ 2006-11-23T01:34:00Z

I've been a happy and active eMusic user for the past several months with a monthly subscription in their highest tier, and I bought a booster pack if I got bored mid-month and there wasn't anything really compelling on Bleep. On a per-track basis:

MONTHLY :: $19.99 / 90 tracks = $0.22 / track
BOOSTER :: $14.99 / 50 tracks = $0.32 / track

However, they recently reshaped their pricing and packaging; the new per-track prices:

MONTHLY :: $19.99 / 75 tracks = $0.27 / song
BOOSTER :: $15.99 / 30 tracks = $0.53 / track

The per-track price impact is a whopping 36% increase:

OLD :: $34.98 / 140 tracks = $0.25 / track
NEW :: $35.98 / 105 tracks = $0.34 / track

The aggregate price increase aside, the fact that the monthly subscription tracks and booster tracks are different goods (at least in that they have different prices) should have tipped eMusic that they might be shooting themselves in the foot. My new purchasing habits will be the monthly tracks only, making the pricing change a net decrease in revenue for eMusic of $14.99 — whoops. Hopefully someone there had heard of price elasticity and wasn't actually expecting to get 36% more out of me...

eMusic was doing a great job of nickel-and-diming me, but I'm not so fond of being dime-and-quartered as an encore.

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The Empty Accent

Paul Brown @ 2006-11-19T17:53:00Z

Not to be left out, I took the quiz, and it got the right answer, i.e., I have the same accent that the people on TV have:

What American accent do you have?
Your Result: The West

Your accent is the lowest common denominator of American speech. Unless you're a SoCal surfer, no one thinks you have an accent. And really, you may not even be from the West at all, you could easily be from Florida or one of those big Southern cities like Dallas or Atlanta.

The Midland
Boston
North Central
The Inland North
Philadelphia
The South
The Northeast
What American accent do you have?
Take More Quizzes

Florida, Dallas, or Atlanta? I don't think so.

It would be easy enough to come up with an equivalent short quiz based on food and place names, e.g., "Does 'sandwich' have an 'm' in it?" or "Does 'Boston' have an 'r' in it?" or "Does 'tea' rhyme with Lee?"

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Mathematics Education and the Lowest Common Denominator

Paul Brown @ 2006-11-18T03:26:07Z

From one of Steve Yegge's rants:

Geometry, trigonometry, differentiation, integration, conic sections, differential equations, and their multidimensional and multivariate versions — these all have important applications. It's just that you don't need to know them right this second. So it probably wasn't a great idea to make you spend years and years doing proofs and exercises with them, was it? If you're going to spend that much time studying math, it ought to be on topics that will remain relevant to you for life.

Sigh.

Unfortunately, there is no canonical ordering of the pedagogical cart and horse in mathematics. Should concepts be rigorously defined and developed at the expense of motivation, or should rigor wait until intuition has been nurtured? My own belief is that the two need to proceed in lock-step so that a student neither becomes bored nor grows careless, but that rigor must be preserved. Rigorous thinking should be the asset that a student carries away from a mathematics course, rather than any particular piece of knowledge or technique. The disclaimer is that I used to be an academic mathematician — completed a Ph.D., spoke at conferences, took an academic job, published some papers, etc. — but I make no apologies for my prejudices about teaching and learning mathematics, as they are the product of knowledge and experience rather than ignorance or malice. (I still have some results that I should write up and publish, but I have a secret plan to spend some of my golden years doing math, something like what R. M. Foster did with his semi-recreational interest in tri-valent symmetric graphs.)

The role of mathematics as queen and servant of science complicates the basic economics of teaching mathematics in a university setting. The various non-honors flavors of calculus are often referred to as "service courses" in that those courses are taught by the mathematics department as a service to other departments. Enrollment drives staffing, be that full-time faculty, adjunct faculty, or graduate students, so it behooves a mathematics department to hang onto calculus courses in order to preserve headcount. This creates tension with other departments who'd like to have the lowest possible barrier to entry and spend time on the smallest body of material. For example, I was on the faculty of the mathematics department at UIC and thus privy to the sort of politics that only people with job security can engage in, and the economics department stirred up a hornet's nest by attempting to hijack calculus for their own marginal gain. The presence of Math 160 "Finite Mathematics for Poets^H^H^H^H^HBusiness" and Math 165 "Calculus for Poets^H^H^H^H^HBusiness" on the list of courses makes me think that the mathematicians lost the battle and won(?) the war in that the watered-down curriculum is present but being taught in the math department.

Watered-down, reduced-rigor service courses are also hard on mathematicians. It's like asking Alain Ducasse to serve Pillsbury "croissants" and convince diners to like it. (Do not poke Alain Ducasse or a mathematician in the belly; they probably will not laugh and might even pop-n-fresh you right in the nose.)

Back to the subject at hand, i.e., the bland preparation of Calculus that's served in schools across the country and obviously left an absence of taste in Steve's mouth. In spite of the fact that the word literally means a method of computing, the meaning and relevance of calculus are not bound-up in the rules and mechanical tricks needed to work contrived physics problems. Calculus is about developing an intuition for functions, about being able to reason clearly about behavior given higher-order observations (e.g., rates of change), about approximation, and about when an estimate is an approximation or not. To further extend the food metaphor, high school (and many college) instructors aren't to blame for the Hamburger Helper ("just add graphing calculator") calculus curriculum, since there's a very high probability that they don't know that Salisbury "steak" isn't really any contiguous part of any one cow — it's the same way they were taught.

More on this later.

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Value to You versus Value to Them

Paul Brown @ 2006-11-16T02:04:36Z

Pricing is a black art, especially when it comes to things like a company, a highly specialized piece of software, or a business relationship with intangible benefits. The rookie mistake is to set the price according to the cost or even to use the cost as an anchor in explaining the price. The value to you in whatever units (dollars, years, number of bowls of Top Ramen eaten, broken marriages, quatloos, whatever...) is irrelevant to the purchaser, while the value to them is some proportion more than you can expect a rational actor to be willing to pay.

Putting the cost on the table in front of the potential purchaser can only weaken your position. Instead, keep the discussion focused on the value and how to ensure that the purchaser realizes it. If they try to low ball you, just say "no"; there's no need to justify it or explain your reasoning.

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A Few Good Meals in Seattle

Paul Brown @ 2006-11-15T16:02:00Z

The wife and I try to put on the dog and get out for a good meal once a month, leaving the kid home with a babysitter. In my case, "dog" means a shirt with buttons and a pair of shoes that aren't Birkenstocks, but the scene in Seattle is decidedly casual, anyway. We've got a preference for tasting menus and local ingredients, and Seattle restaurants have been good to us so far.

The places that we'd go back to, with links and comments:

  • Rover's. Northwest cuisine with a French accent and inspired wine pairings (e.g., a white burgundy with lobster and beets). We went for one of the pre-set dégustations, but Rover's is the only restaurant I've seen that lets people mix-and-match off of tasting menus. Like lots of restaurants in Seattle, no valet parking.
  • Canlis. Impeccable service (they do a no-claim-check valet service where your car is waiting for you when you walk out) and solid if a bit traditional menu. We inadvertently ordered too much food because the portions were larger than we expected.
  • Le Gourmand. More seasonal Northwest cuisine with a French edge. We happened to go during morel season, and a big, saucy plateful with some venison as a garnish was part of the meal. If his reputation holds, the morels were probably gathered by the chef himself.
  • Sitka & Spruce. Creative small plates, local seasonal ingredients, and a chalkboard menu on the wall in a tiny space. Here's a nice review with pictures in a local "metroblog".
  • Elemental. Small plates with a fun "skip the menu and just bring me some food and wine" guessing game dégustation. The only negative with the meal was that the pairings included full glasses of wine, so we left both stuffed and stupefied. Like Sitka & Spruce, Elemental is tiny (~20 seats), and fills the tables for a first seating promptly at 5:30PM. (We got turned away once by arriving at 5:35...)

The Herb Farm for a game-centric menu is up next.

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Finding a New Sitter

Paul Brown @ 2006-11-13T21:29:00Z

Our current sitter is just about perfect: good-natured, senior from UW, energetic, down-to-earth, experienced with children, and well-liked by the kid. Nonetheless, she's graduating soon and then going to grad school, so we'll have to find someone new and break them in before our current sitter is unavailable. People are understandably guarded about their babysitters and nannies, so we're expecting to have to start from scratch rather than getting a referral from a friend. (There's probably some interesting economics or game theory lurking around, as it seems like an extreme case of asymmetric information or an inverse case of signaling.)

The wife and I joke about trying to pick up a new sitter on the UW campus: "Hi. If you need some extra money, my wife and I were wondering if you'd be interested in coming over every couple of weeks and watching... No no no, watching our kid." In all seriousness, UW and SPU both have education programs, and a couple of postings may get us what we're looking for.

The question of whether or not we'd consider a "manny" or male babysitter is interesting to me, since my inclination is "no". I see myself as a competent and nurturing father, so clearly men can be successful caregivers. Nonetheless, I would much sooner trust a female babysitter than a male babysitter if for no other reason than a twenty-something male having a nurturing interest in children is sufficiently outside of statistical bounds as to make me suspicious about motivations.

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Then Do Something Different

Paul Brown @ 2006-11-07T03:05:00Z

Bill Grosso pointed me at Mark Himelstein's book "100 Questions to Ask Your Software Organization", and I've been surprised not to find more mentions of the book or Mark's blog out in the blogosphere. (That said, he as an accomplished VP of Engineering, not Marketing.) The book is a little rough around the edges, but it's a very realistic picture of what it means to lead a software organization. It's a good exercise to take a question a day and honestly assess how you've dealt with it. Especially in a context where you don't have more experienced leaders to learn from, forced introspection is valuable.

A recent blog entry from Mark reminded me of one of the most difficult things about being a leader, which is being wrong:

When an organization is facing challenges around meeting their commitments, hiring goals, retention goals, and quality goals it is often suggested that teams improve their processes. While I have seldom seen teams succeed without processes, I have seen numerous teams fail with them. In my mind they are required but they are not sufficient. In the end, competent and courageous leadership will win the day.

I've seen the inappropriate emphasis on "how" instead of "what" in companies large and small. If what you're doing isn't working, then you need to do something different. In metaphorical terms, it's not a question of your velocity, attitude, hairstyle, or the angle of incidence of your head with the brick wall — recognize and acknowledge that it's a brick wall and find a way over or around rather than try to go through and dragging your organization along with you. (Or, for that matter, find a way to use the brick wall in your favor; a barrier to execution can turn into a advantage if you're able to use it against your competitors.) The right amount of process is the least amount of rigidity that ensures that good information flows up to the leadership and that the effectiveness of changes in direction can be quickly and objectively assessed.

As to the right kinds and levels of processes, two key challenges come to mind:

  • Select the right metrics for the goals. Hard, quantitative measurements recorded regularly are a must, but it takes discipline to ensure that those measurements have a causal relationship with the goals at hand. Is reducing bug counts going to enhance engineer morale? Is marketing effectiveness going to enhance sales effectiveness, or is the pipeline kinked-up elsewhere?
  • Ensure that locality of action and locality of information coincide. A well-factored organization has the same smell as a well-factored API, and no process should involve information and decisions moving across more than one tier at a time. Should an executive care what flavor of XP a particular team is using? Absolutely not, other than to ensure that the experiences of that lead/manager are disseminated to others. Should an executive carefully review deliverable definitions, ruthlessly track progress, and drive consensus between the teams that collaborate on a product? Absolutely. Effective processes preserve the autonomy and cleverness of people at different levels in the organization, and if your organization lacks that kind of trust, then gut it — you have the wrong people.
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