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July 19, 2005
"Tunneling" Consumers and Venezuelan Radio
I've long held a theory that people buy what they're sold. In other words, when it comes to making certain purchases, people buy from a selection of what they're shown. This may seem pretty obvious, but it always burns me when record companies, car manufacturers, etc. rely on the defense of "it's not what people want" when asked why they don't produce more musically complex albums or environmentally-friendly vehicles or more ergonomically designed widgets--whatever the product may be.
Clearly, the average American consumer isn't going to buy a hybrid if you make it look like a hyperlame geekmobile with the all power of a steam-powered go-kart. My theory is that people simply aren't given compelling choices and so, either out of ignorance (meaning ignorance of their true options, not stupidity) and/or a desire for expediency, they take what they're offered as opposed to demanding something different. It's a kind of passive consumerism. Is it any coincidence consumers happen to buy those products which result in the greatest profits for the producers of those products (SUVs, one-hit-wonder bands, etc.)? No. It's "tunneling" in action. By controlling every option the consumer has, a company can, in certain cases, effectively steer decisions made by consumers.
The real question to me has always been: what would happen if you could change such a market in one stroke? Would the people demand a return to the old? Would they just adapt and deal with it? Would they actually come to prefer the new system imposed on them? Would riots break out to demand Britney Spears get more airplay?
While those leaders in history who have held the power to make such sweeping moves have made some pretty grim decisions (say, Stalin with the extermination of the kulaks, Mao with The Great Leap Forward, etc., etc.), Venezuelan President Hugo Chavez has also taken a hard, yet comparatively bloodless line--and helped me out by setting up an interesting experiment.
According to the Washington Post, the Venezuelan National Assembly (which the Post views as a rubber stamp of Chavez's positions), "recently passed a law requiring that no less than 50 percent of all music played on the nation's radio stations be Venezuelan." The law mandates that, "no less than 50 percent of all music played on the nation's radio stations be Venezuelan. Of that, half must be classified as 'traditional,' showcasing the 'the presence of traditional Venezuelan values.'"
In response many Venezuelan artists have begun to cover traditional songs and record sales of Venezuelan music have skyrocketed. Informal polls report that Venezuelans are enjoying the new selections and, indeed, it's become somewhat fashionable to listen to traditional music in recent months. The manager of one of Caracas' largest music stores told the Post, "We've always had traditional Venezuelan records in stock, but before a few months ago we never sold any -- not one. It was all Britney Spears, Backstreet Boys and that sort of thing. But now I'd say one-third of our business comes from Venezuelan artists, which is absolutely incredible."
In this case, given variety (50% traditional, 50% standard fare), a significant portion of the population has opted for the alternative. Is it wrong to partially control what kind of music can be played on the radio? U.S. recording companies and their lobbying groups think so and strongly condemn the move. Of course, for Venezuela, it keeps a significant chunk of money in the Venezuelan economy supporting Venezuelan culture and artists that would otherwise be subsidizing Britney's latest bling binge. Maybe it's not so crazy and dictatorial after all....
Posted by Matt Markovich at July 19, 2005 11:42 AM