Self Driving Cars Will Be Here Before a National Train System, and Maybe That’s OK

robot car google

An article at Wired today discusses an Audi A7 prototype that can drive itself on highways. This is another notch in the growing belt of automated cars, championed primarily by Google’s amazing self driving car technology. Numerous automakers are getting in on the fun since this is clearly the future direction of driving and safety technology (whether you like it or not).

Let me cut to the chase: the ultimate future of all of this is a completely automated system of driverless cars, and this will likely happen before the public transit dreams of progressives like myself–like a national high speed rail line–are realized. This is due to three basic reasons: (1) safety; (2) cost; and (3) accessibility. All of these three things get better if we give into our robot overlords. To some this sounds terrifying, boring, or a mix of both. To me it sounds like a future we desperately need.

Robot Cars Will Be Safer

33,000 people died in the US in auto accidents in 2012, the last year for which we have complete data.  90% of these are due to human error. An estimated 1.2 million died worldwide in 2010.  Beyond the suffering of these tragic deaths, both fatal and non fatal auto accidents cost hundreds of millions of dollars each year. A completely automated system of autonomous vehicles would be safer and would drastically reduce these numbers.

A computer hypothetically can, with the right software and hardware, outdrive the best human operator. Driving is judging safe movement within a three dimensional space.  That is basically math.  Computers are really good at math.  The technology is currently a clumsy and young, but even in its current iteration, Google’s driverless car program has gone over 300,000 miles with only two accidents–both due to human error.  They currently struggle with snow and ice and other things that may seem simple to humans–such as on the fly pattern recognition, like discerning between a rock and a person.  In time, however, it is possible to iron these deficiencies out. After all, only ten years ago autonomous cars could not go beyond the first 7.5 miles of DARPA’s  142 mile autonomous car competition.  Only 18 months later, five vehicles finished the entire course.

Contrast this to eternally inevitable “human error.”  Despite thousands of laws, regulations, and tests designed to ferret out incapable drivers and restrict our behavior on the roads, we still make mistakes, and we always will.

What if the computer breaks? Well, what if you have a heart attack? What if a bee flies into your car and distracts you? The mechanical operation of a computer is probably much less prone to random catastrophic failure than you are. For one, a computer probably has better judgment regarding its functionality. It can be programmed to run diagnostic checks, have a failsafe, and generally can determine whether it is safe to use in a much more objectively accurate way than a human.  Humans think “well I only had two beers” or “it’s not snowing that hard, I don’t need chains” or “I can make that yellow light if I just speed up…” A computer won’t make those vague judgment calls, or at least it will make its judgment calls on more objective and verifiable data. Like a black box, you will be able to go back and look at what caused an autonomous vehicle to crash, compared to the litigious and vague nature of current accident reconstruction.

In fact the biggest safety obstacle is the problem of a future world inhabited by untrained drivers who have never operated a motor vehicle, and who are tasked to take control of an uncontrolled AI car. Or, the ethical implications of the trolley problem; i.e., how do you program a car to react in a situation where all potential outcomes lead to death or catastrophic injury? These are not problems with the hypothetical technology however. These are human problems.

 Robot Cars Will Be Cheaper And More Efficient

As already mentioned, auto-accidents take a tragic and constant toll on our society. Beyond the tragic human suffering of these accidents, there are also huge economic costs. These costs are spread throughout our economic system in the courts, the health care industry, the auto industry, and almost every single other economic sector since travel via automobile is such an intimately intertwined part of almost every American’s daily life. Less accidents lowers this significant toll.

There are other less obvious cost savings however: an entirely automated system will mean less traffic, more parking, more efficient fuel usage, more time for human drivers to do other things, quicker car trips, reductions in insurance costs, reduction in the need for traffic and parking enforcement, and a generally more efficient transportation system for society.

Of course, alot of these benefits depend on a completely automated system to realize their full potential.  While judging things like safe driving distance  or optimal acceleration and deceleration are things autonomous vehicles currently excel at under limited conditions, communication between other vehicles is another important goal. (Perhaps more important.)  Consider this terrifying yet shockingly-safe computer simulation of a completely automated 4-way intersection, for instance.

Or the benefits of reduced traffic in a system where every car drives at a safe distance from one another without stop and go traffic. Or a highway merge where all the cars know where every other car is going and react accordingly, without the madness associated with chaotic interchanges like the Bay Area’s “MacArthur Maze.” All of the little things that cause daily rush hour traffic jams other than accidents–following too closely, improper merging, unsafe or sub-optimal traveling speeds that necessitate needless braking–are eliminated or reduced in a system where all the vehicles cooperate on an agreed upon optimal flow of traffic.  A utilitarian driver’s paradise, if you will.

Traffic jams cost an estimated $121 billion a year,  waste an average of 38 hours a year of every American’s life, and consume an unnecessary 1.9 billion gallons of fuel  per year.  The benefits of an automated system on our economy, our happiness, and our environment  outweigh the freedom and “enjoyment” of driving yourself around.  (How much do you really ever enjoy driving yourself or others around, really?)

And then we get to parking. A truly autonomous vehicle could reshape the urban landscape.  In today’s “holy shit are you kidding me?” fact of the day, over 30% of city business district driving consists of people driving around looking for a parking spot. On average, one third of an American city’s landscape consists of parking spaces. Your friendly robot car could just drop you off and go park itself somewhere, or drive home, or just drive around waiting for you.  That space could be reduced and used for other purposes. Urban planning would change to accommodate the reduced need for parking, which currently dominates the hated (by me, anyway) “big box” parking lot syndrome of modern suburban development. The benefits are transformative and are a realistic means of achieving the public transportation and mixed use goals of a lot of progressive urban planners. More retail establishments could exist in higher density urban environments since the need for big parking lots would be eliminated, for example.

Robot Cars Are More Accessible

A robot car could eventually drive anyone anywhere.  This one is a no-brainer, really. More people could get more places on their own. Society has already made this a goal with laws like the ADA and its state analogs. Driverless cars would further these aspirations in addition to the benefits already described above.

This Is Not A Fairy Tale–This Can Happen

This brings us back to the title of this post. Regional high speed rail systems in the United States remain, unfortunately,  mostly pipe dreams. Only one high speed rail line exists in the United States between Boston, New York and Washington D.C. (and it operates at a relatively “pedestrian” average of 68 m.p.h.). A myriad of others remain either in limbo or dead.  Even California’s high speed rail line–voter approved and currently under construction  between Los Angeles and San Francisco–won’t be open until 2020 at the earliest. (That is assuming the myriad of budget and political problems get ironed out and it actually gets completed.) A national high speed rail system would be impossible if it had no regional systems to connect.  In the meantime, automated cars already have the infrastructure in the form of roads. People already are used to driving or getting a ride to work, whereas (in America, at least) most people simply do not use trains. Automated cars also would not need the massive government subsidies currently floating high speed rail proposals, because auto manufacturers are actively in the process of developing and deploying the technology.  And once they do, with hypothetical autonomous cars zipping along on the freeway at much higher speeds, and for a longer sustained period than human operators, will the need for regional high speed rail systems be as acute as it is today? Arguably not. And that is not necessarily a bad thing.

 

Ubisoft’s “Free” Offer to Assassin’s Creed Consumers Isn’t Actually “Free”

The world of video games is a tumultuous one.  Video game releases look more like big budget movie releases these days, and in some cases they make even more money. So a big problem with a big video game release can be big trouble, and Ubisoft’s recent release of Assassin’s Creed: Unity has been nothing but trouble.  The game was reportedly full of bugs,  and it got so bad that developers just gave users additional content for free. Millions of consumers, however, had already paid for that additional content in the form of pre-ordering a “Season Pass,” so Ubisoft had to offer another apology and another free game to appease consumers. This is known in the industry as “shining a turd.”

There is a little problem with this so called “free game” however. It’s ain’t free, even though Ubisoft unequivocally claims it is. Here is a screen cap of Ubisoft’s free game offer, in case they take the page down. I have used my amazing MS Paint skillz to highlight the “free” part:

assassins creed free bullshit

Here’s the catch: when you try and download the game, Ubisoft makes you sign a boilerplate “clickwrap” agreement that waives your right to sue Ubisoft for all of the tremendously awful problems with Assassin’s Creed: Unity. 

You hereby irrevocably and unconditionally RELEASE, WAIVE, AND FOREVER DISCHARGE AND COVENANT NOT TO SUE Ubisoft Entertainment S.A., and each of its past, present and future divisions, parent companies, subsidiaries, affiliates, predecessors, successors and assigns, together with all of their respective past, present and future employees, officers, shareholders, directors and agents, and those who give recommendations, directions, or instructions or engage in risk evaluation or loss control activities regarding the Campaign (all for the purposes herein referred to as “Released Parties”) FROM ANY AND ALL LIABILITY TO YOU, your assigns, heirs, and next of kin FOR ANY AND ALL CLAIMS, DEMANDS, CHARGES, LAWSUITS, DEBTS, DEFENSES, ACTIONS OR CAUSES OF ACTION, OBLIGATIONS, DAMAGES, LOSS OF SERVICE, COMPENSATION, PAIN AND SUFFERING, ATTORNEYS’ FEES, AND COST AND EXPENSES OF SUIT, KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, ARISING OUT OF OR RELATED TO THE PURCHASE, ACQUISITION, RENTAL, POSSESSION AND/OR USAGE, AND/OR THE INTENT TO PURCHASE, ACQUIRE, RENT, POSSESS AND/OR USE, THE ASSASSIN’S CREED UNITY VIDEO GAME AND/OR THE ASSASSIN’S CREED UNITY SEASON PASS ON ANY AND ALL PLATFORMS, AND/OR RELATED TO THE CAMPAIGN, WHETHER CAUSED BY THE NEGLIGENCE OF THE RELEASED PARTIES OR OTHERWISE.

A settlement agreement is a contract and a contract by definition cannot be created without exchanging something of value. Waiving your right to sue Ubisoft for damages, or to participate in a class action, has value. That means this “free” download isn’t free, and Ubisoft is arguably creating yet another problem by engaging in false advertising in violation of a variety of false advertising laws, including California Business and Professions Code section 17500:

It is unlawful for any person, firm, corporation or association, or any employee thereof with intent directly or indirectly to dispose of real or personal property or to perform services, professional or otherwise, or anything of any nature whatsoever or to induce the public to enter into any obligation relating thereto, to make or disseminate or cause to be made or disseminated before the public in this state, or to make or disseminate or cause to be made or disseminated from this state before the public in any state, in any newspaper or other publication, or any advertising device, or by public outcry or proclamation, or in any other manner or means whatever, including over the Internet, any statement, concerning that real or personal property or those services, professional or otherwise, or concerning any circumstance or matter of fact connected with the proposed performance or disposition thereof, which is untrue or misleading, and which is known, or which by the exercise of reasonable care should be known, to be untrue or misleading, or for any person, firm, or corporation to so make or disseminate or cause to be so made or disseminated any such statement as part of a plan or scheme with the intent not to sell that personal property or those services, professional or otherwise, so advertised at the price stated therein, or as so advertised. Any violation of the provisions of this section is a misdemeanor punishable by imprisonment in the county jail not exceeding six months, or by a fine not exceeding two thousand five hundred dollars ($2,500), or by both that imprisonment and fine.

Ubisoft is intentionally “disposing of” (i.e., giving away or selling) property (the game) along with “inducing the public to enter into any obligation” (i.e., waiver of their right to sue) with “untrue or misleading” statements, namely, that the “free” download is “free,” when in reality the consumer has to waive their rights to sue.  This is illegal.

I am not sure what is sadder: that Ubisoft is this stupid or that we have become so cynical that internet outrage is basically limited to “well that sucks” type comments such as Game Informer’s comment that “these terms aren’t surprising.” Even Consumerist–usually on top of these sorts of scams–makes no mention of the legality of this clause. (They do accurately point out that this goes beyond the normal consumer fleecing we see in forced arbitration clauses, a favorite topic of mine.) Have we become so jaded that we simply assume a company can lie and tell us something is free when it plainly is not at all free?

How to Reject Consumer Arbitration Clauses

As I have previously blogged about, almost every single consumer contract with a big retailer or service provider includes a broad, sweeping waiver of your rights to a jury trial. Instead, these companies make you agree to arbitrate all disputes in a forum favorable to them. You have probably also waived your right to participate in a class action. This is bad for consumers and good for major companies. It lowers the company’s exposure in case they release a harmful product, and limits the rights of their customers in case of abuse or shady billing practices.  Basically, they don’t have to worry as much about treating you fairly. I think that stinks.

However, buried in many of these agreements is an opt-out. If you sign any new consumer agreement in the near future, or if you get an email saying your current agreement has been amended and you have the opportunity to review it, look for the arbitration clause in the agreement, and look for the opt out provision. It will likely require you to mail a letter to some address. Do it. Here is a rejection template:

Via U.S. Mail [or however the agreement specifies]

[address of recipient]

Re: Rejection of Arbitration Provision

To Whom it May Concern:

I am in receipt of your [insert name of agreement, e.g. “Amazon Store Card Agreement”]. Pursuant to [insert arbitration section, e.g. “Section III, “Evil Evisceration of Your Consumer Rights by Corporate Fatcats”] of the Agreement, I am rejecting the arbitration provision. I wish to retain my rights to a jury trial in State or Federal Court.

My information is as follows:

[name, address, account number]

Please let me know if you require any other information. Thank you for your prompt attention to this matter.

Very truly yours,

[happy customer]

That’s it. Pay attention to the information requested and include any additional information they request.  Also be sure to mail it in within the deadline provided, usually 30 or 60 days.

For the price of a stamp, an envelope, and a piece of paper you retain your constitutional right to a jury trial. Don’t let big  behemoth retailers and service providers like Comcast and AT&T and Amazon divide and conquer America’s consumer base–always sign and deliver arbitration rejections!

Court Allows Class Notice Via Social Media

A sign of the times? A New York court approved Class Notice via social media in a lawsuit against Gawker Media LLC. FLSA Overtime Law Blog has the scoop. Gawker is being sued in a class action by current and former interns for allegedly violating the Fair Labor Standards Act (“FLSA”). Since it is a class action, a majority of the interns probably do not know about the case, and the Court wants to inform them of their right to participate.

Interns are usually young. Gawker is a well known blogging website. Ergo, social media is probably an excellent means of getting in touch with these young, tech savvy class members. The Court noted in its Order that “89% of 18—to 29–year–olds use social networking sites.” You can find the Order here.

I applaud the Plaintiffs’ creativity and I will be keeping this Order in my research file for my next class action.  Class actions are hard.  Max Kennerly’s Litigation and Trial blog (if you’re a litigator add that to your weekly reading list) has an excellent post detailing just how difficult some class cases can be. Even if you “certify” a class action (i.e., get a Judge to agree that your single Plaintiff can represent a larger number of as-yet unnamed similar Plaintiffs) you are still faced with the huge hurdle of actually getting everyone in the class to participate. When class participation becomes a problem depends on whether you have an “opt-in” or an “opt-out” class notice procedure. In California, the default rule is all class cases are “opt-out.” This means you are in the class unless you tell the Court you are not.  Class certification in California therefore usually goes like this: (1) the court certifies the class; (2) the lawyers agree on the form of class notice and submit it to the court for approval; (3) class notice goes out to class members; and (4) class members either opt out of the class after receiving the notice, or they do nothing and remain as class members. The Federal rule, by contrast, requires you to opt-in after being notified.  This means you are out until you tell the court you are in. Practically speaking, under the Federal rule it is harder to get higher participation in the actual class. If too few people opt-in to the class, then you have no class case, or you have a lower amount of exposure to the Defendants and thus less leverage to settle the case.

I do not know the average opt-in rates for Federal class cases, but in California it is customary to expect as few as 15-25% of the class to actually participate or even claim any settlement once the case is settled. Yes you read that right. Once the case is settled and the class is told “hey, there is a pot of money with your name on it, just tell us you want it” only around 1 out of 4 class members claim the money.

Why? Sometimes a class settlement is so nominal it might not be worth your time. I once got a settlement for about $10 in some consumer case against Dell. I didn’t mail that in, even though it was basically free money. (I should have!) In my experience however I think the biggest culprit is stale class member contact info. I have had low participation even in cases where class members were potentially getting hundreds or thousands of dollars, and it was primarily because we just could not find people. This is often the case in wage and hour class cases against places with a lot of turnover, such as restaurants or other low wage establishments.  In these cases sometimes you are trying to find people employed as long as eight to ten years ago, and whose records might not be complete or accurate (or might not even exist at all). Think about it–do you think someone could have found you when you were 27 based on a single snapshot of info garnered from when you were 19? Might be kind of hard.  And in some cases if participation is too low, then your class is decertified. That means it is dead, gone, kaput, bye bye.

This is obviously not how anyone wants class cases to go (except defendants). Defendants actually bank on low participation by crafting one-sided class settlements with two pay-out numbers. These are called “reversionary settlements.”  They basically work like this:  you have one big number that might sell with a court and with an over-eager Plaintiffs’ counsel, but getting that pay out is dependent on some totally unrealistic % of participation. There is a second smaller amount that kicks in if there is not enough participation in the class.  Defendants like these deals because they know that so long as the participation number is high enough, they will never have to pay top dollar to settle the case. For this reason  devising creative and effective ways to increase class participation in settlements or during the class notice period is always a high priority for Plaintiff’s lawyers who want their clients to get paid.

Enter social media. A brilliant idea and something more courts and more Plaintiffs should suggest for class notice. When you move or change your phone number, odds are you are still keeping your Facebook account or your Twitter profile. Odds are you might even check those more than you check the mail. (How many times did you physically open your mailbox this week? How many times did you open Twitter or Facebook? Exactly.) High participation in class cases is not only good for class members, it is good for the integrity of the system, since class action cases and the lawyers who prosecute them get a bad rap in the media, mostly thanks to a constant dose of reported “coupon” settlements that look like a windfall for lawyers. This perception is not representative of the actual class action landscape and it should change. Class cases are one of the most effective tools in the consumer or the employee’s arsenal for enacting real, positive social change on behalf of a large number of people whose individual claims might not be worth enough to get to a court room. (Or worse, people might not even know it is happening to them.)  Class actions are literally the answer to being “nickel and dimed.”  They exist for that reason. It’s why big business would love to kill the class action device entirely (and spends billions every year trying to do so). Hopefully  the internet and social media will help push the needle in the other direction.

 

 

Robert Reich Reads My Mind

From my Facebook feed, where me and Robert Reich are totally besties:

We need to raise the minimum wage, invest in education and infrastructure, lift the cap on income subject to Social Security payroll taxes, resurrect Glass-Steagall and limit the size of the banks, make it easier for low-wage workers to unionize, raise taxes on corporations with high ratios of CEO pay to average worker pay, and much more. In other words, we need an agenda for shared prosperity.

I particularly like the last idea. Any other agenda items he is missing? On a scale of 1 to 10, with 1 being least likely, how likely is it we get three of those done in the next six years? I’d guess it’s about a 2. This makes me sad.

Why You Should Vote Yes on Prop 46

If you sue your doctor for medical malpractice you can recover two basic types of damages: economic and non-economic damages. Economic damages are the out-of-pocket expenses incurred as a result of medical error. Your surgery bill, the funeral expenses for your loved one, or the lost wages resulting from you or a loved one missing work. The non-economic damage is the intangible amount that a Jury awards to compensate you for what the law calls “pain and suffering.” It is the hard to define (and often, anything but compensatory) amount of money that a jury thinks a life is worth. For better or worse “Justice” in the civil court system is measured in dollars and cents.  And justice for medical negligence is, predictably, a whole lot of money, because why shouldn’t it be?

Well in California, those non-economic damages are capped. In the 1970’s the insurance lobby, alarmed at the high dollar value of cases brought against doctors for medical malpractice, successfully lobbied for a $250,000 cap on non-economic damages in medical malpractice cases, among other things.   That basically means that insurance companies have decreed that your suffering, or the lost life of your loved one, is worth a set pre-determined amount of $250,000. This cap does not adjust for inflation. Just to give you an idea of what $250,000 got you in 1975: a gallon of gas was $0.50, the average cost of a new car was $4,250, average rent was $200, and the average cost of a new house was $39,300.  Adjusted for inflation, $250,000 in 1975 is about $1,000,000 in 2014. Things are a little more expensive these days, but damages in medical malpractice cases will be $250,000 tomorrow, and they will be $250,000 in 2050. Does that sound fair?

Well it gets worse. Guess who is harmed the most by that cap? People whose damages are predominantly non-economic as opposed to economic. Let’s say for example that the current CEO of a Fortune 500 company is in a car crash and needs emergency brain surgery. Let’s say the doctor botches that surgery in some catastrophic, negligent way and the CEO dies. The CEO’s family can sue the doctor and the hospital for the amount of money that CEO was going to earn had he survived the procedure, which would have been a whole bunch of money. While the non-economic damages are capped at an arbitrary and unjust $250,000,  the family is still able to sue for a large amount of money since their loved one was such a high earner, and since his high earning capacity is so easy to prove. The family will need to hire a lawyer to get it, but they won’t have any trouble doing that.  The case has a predictable high dollar value, and the family might be able to afford to pay a lawyer by the hour anyway.

Now let’s say that instead of a CEO, it is a four year old child of a low income family. They can’t afford to hire an attorney by the hour.  That means they need to hire a contingency lawyer who only gets paid once they win the case. The child, obviously, has no wage earning history. The economic damages are the cost of the medical procedures, funeral expenses, and other out of pocket expenses that an insurance company pays for anyway, and that the insurance company recovers back for itself as opposed to the family. The “non-economic” damages are capped at $250,000.  And that isn’t a blank check that gets written out by the hospital, that’s a dollar amount that the insurance company will make a family fight tooth and nail for. Both the lawyer’s fee and often costs (often paid by the lawyer up front, since the client cannot afford it) have to come out of the recovery, and California puts strict limits on how much of the total judgment the lawyer gets.  If a lawyer sinks $100,000 in costs into a trial (common in these cases), along with thousands of hours of their time over the course of a year or more, the attorney is still breaking even at best and probably losing money. And more importantly the client is only getting around half of the entire $250,000 judgment, after at least a year of grueling litigation.  Not to mention that the Defense wins about 80% of these cases.  In other words, an attorney is betting about $125,000-$150,000 of their own money with 20% odds just to break even in the best case scenario. How many lawyers are going to do that? How many clients are going to want to fight that battle?

That family thus might be getting nothing, because they will have a hard time getting an attorney to represent them in the first place, or they will find a good lawyer who is open and honest about their chances and what it will take mentally and physically to get there, and the family will decide that it isn’t worth it.  Even a low hourly rate is out of reach, due to the huge amount of time necessary to try these cases , and the huge amount of costs incurred in witness fees and court expenses that a lawyer has little to no control over.

Eliminating the ability of contingency attorneys to make a living fighting for victims of medical negligence is exactly what the insurance companies intended. It helps their bottom line to deny justice to victims of medical malpractice. This is out of the corporate defense lobby playbook of denying access to the courthouse for regular people. If they don’t like the law, they prevent people from enforcing it. Like, for instance, mandatory consumer arbitration.  This is unfair.

Although I do not practice medical malpractice litigation, I do practice employment law and I represent primarily low income Plaintiffs on a contingency basis, so this hits close to home for me. It’s an unfortunate fact that utilizing the court system in the United States costs a lot of money, but it does. The multiple reasons for that are beyond this blog post. Contingency attorneys are the keys to the courthouse for the vast majority of Americans without deep pockets who cannot afford to pay outrageously high court costs, or an attorney’s hourly fee.

Statistics bear this out. 71% of cases in California dealing with infants had their verdicts lowered to the $250,000 cap.  67% of elderly victims also had their verdicts lowered. Is it sound public policy to prevent families from recovering money for the preventable deaths of infants and the elderly? I don’t think so.

Here’s the deal with Prop 46. It basically adjusts that $250,000 cap to take inflation into account. In 1975 dollars, $250,000 is roughly $1,106,092.01. (Via BLS.gov.) Prop 46 thus raises the cap to $1,000,000. This will open the courthouse doors to young and elderly victims of medical negligence who are now shut out of the system.  That’s why I support it.

Do not believe the ads saying this will raise your premiums, or cause doctors to leave California, or increase the use of “defensive medicine.” These claims have been studied (since caps have been around for a long time in various states) and they are wrong.  Simply put, these caps serve one purpose: saving insurance companies money at the expense of victims.

A controversial part of the bill also calls for drug testing doctors. I am torn on this element of the bill. I get why they put it in there, but as a matter of principal I disagree with random drug testing. Ultimately, I think raising the cap is simply too important to vote no because of drug testing. It deeply saddens me to see colleagues in my line of work who are going to vote No because of it. I understand and respect their decision but I strongly disagree.

So vote YES on Prop 46 this November. It’s a Yes vote you will hopefully never need, but you or your family will be better off if you ever do.

I Was Cord Cutting Before It Was Cool, Man

Duuuuude

Duuuuude

Around 2005, I bought my first “big” TV. It was my first year of law school and I guess I wanted to frivolously spend my student loans. I never had a “big” TV before and this was around the time that large flat screen TV’s were becoming more mainstream and cheap. It was a Vizio Plasma 42″ and it was mesmerizing. When my buddy and I lugged it into my apartment and took it out of the box, we both just sort of stood there and stared at its huge, empty black screen. There was only one problem–I had no cable and no antenna. So I hooked up my laptop to the TV, which luckily had a VGA port (how times have changed) and my cord cutting days began.

I learned that “cord cutting” was a thing about 3 years ago.  I thought I was just this unique, free thinking genius that had discovered a secret world of online streaming TV, sort of like that XKCD comic:

Courtesy to the always funny and interesting xkcd.com

Since discovering I am not alone, it has been interesting to see how a niche industry has developed outside of the parameters I chose for myself.  For instance, my long time set up has been pretty simple:  a small Windows PC (that I build myself, emphasizing low noise, gaming prowess, size, and looks)  a wireless mouse, and a wireless keyboard. No remote control, no media frontend software, none of that. Just Windows and the Internet. A lot of people I talk to about this setup think it is antiquated and clumsy, which might be true. (I find it simple.) The online streaming options have greatly improved since 2005, but the basic system is the same. (The old Vizio died, twice, and has been replaced with a lovely Panasonic 52″ plasma. Oh, I also added a receiver and some nice Polk Audio speakers… but that’s about it.) The websites I primarily use today are:

  • Netflix
  • Amazon
  • Individual TV network sites, like Comedy Central
  • MLB.tv
  • Digital over the air channels
  • Highlights from NFL, NBA, and other sports sites for games that already happened.

That’s it. Between those resources I can basically watch anything I want, whenever I want, and it all looks good since HD streaming is now mainstream. (Except some live sports… but unless it is a big game, I am content listening on the radio. If it is a big game on cable only, that is more fun to watch with a crowd or a friend anyway.)

Hardware wise, I hook up my custom built “HTPC” (home theater PC) housed in a beautiful little Lian Li Q11 desktop case to my receiver via HDMI. The receiver goes to my TV via another HDMI cable. Yes, watching TV requires knowing how to actually use a computer, but this only stops my three year old (and not for long). I have occasionally left detailed instructions for house-guests. (Step 1: turn on gray box; Step 2: turn on black box. Step 3: turn on TV; Step 4: click on the internet; etc.) Since I built the computer myself, I made sure it has some juice to play games, which I enjoy from the comfort of my couch with a wireless Xbox controller (which works with Windows). Of course I have not had the time to play video games since 2011, but at least it’s there! This probably also explains why my Xbox 360 is sitting in a box in a closet somewhere, after I tried and failed to sell it on Craigslist.

Some people think it is crazy to use a wireless mouse and keyboard from a couch. It works fine for me and I have never had an issue with it. It has been amusing to watch this market segment grow, and to see the streaming services I use tout “new” products that will let people *gasp* watch Netflix streaming, or Hulu, or Amazon, on their TV! USA Today estimates that about 6.5% of people have “cut the cord.”  Nowadays people use XBMC, or some sort of Linux frontend, or they use Windows Media Player, or Roku, Apple TV, Google TV, their Xbox One, their PS4, or they just use the apps that come with their “smart” TV. I don’t really keep up with what’s going on beyond reading tech websites, since I’ve got what works for me.

The End Better Not Be Near

There are two ways my way of life could come to an end. The first one (the realistic one) is that more and more streaming sites stop streaming unless you subscribe to cable (this is currently how ESPN, Fox, and HBO Go do it, among others). Couple that with a lot more sites offering their own streaming services and cutting off licensing deals with Netflix, and I am relegated to buying cable or buying each and every individual show I want to watch on Amazon or iTunes. The other highly unrealistic scenario is sites just offering their own content online for their own monthly fee, commonly referred to as a la carte cable. I say this is unrealistic because the economics of cable television are such that channels like ESPN make waaaay more money from exclusive licensing deals and cable TV deals than they would from charging people individually. Check out this article over at the Atlantic, for instance, which includes a chart showing that ESPN makes $7.2 billion in revenue per year before advertising, just off of money it skims from your monthly cable bill.  The billions of dollars ESPN also makes off of exclusive licensing deals with the NBA, NFL, and multiple college conferences like the SEC are dependent on this massive eyeball reach, something it might not have if everyone had the choice of subscribing to ESPN or not. That means ESPN would likely have to charge up to $30 month, the Atlantic estimates, to make up for this lost revenue if they went “a la carte.” Ain’t gonna happen. The economics are mostly the same (but scaled down) for other popular networks.

If that were to happen, cord cutters like myself would surely face the alarming possibility that “a la carte” television actually winds up costing more than just buying cable. This has been a more popular story recently thanks to HBO’s decision to offer its online HBO Go service “a la carte,” i.e. without a bloated and mostly useless cable subscription, for a monthly fee. CBS also offers a monthly fee-based streaming service (which is odd since I can get CBS over the air).

It may be that the days of Netflix or Amazon having everything I want are numbered, as more and more content owners decide they want to make money streaming their content online rather than selling it to others to stream for them. I don’t know. Personally, I think the doom and gloom is a little premature since you really have to have a truly deep offering of original content to justify charging people a premium to watch just your shows. HBO can do that since they have such a huge assortment of great original shows and licensing deals thanks to their parent, Time Warner. Netflix is obviously working hard to hedge its bets with House of Cards, Orange Is The New Black, and so on, to justify its existence in an Armageddon like scenario where everyone decides to stop licensing their content libraries (like when Starz decided to pull the plug on Netflix in 2013, cutting 2,000 titles).  But would I pay Comedy Central a monthly fee to just watch the Daily Show? Tempting, but no.  Would AMC successfully wring, say, $10 a month out of my wallet for Mad Men, Breaking Bad, and the Walking Dead (which the Atlantic estimates it must charge to make up for lost cable revenue if it were unbundled)? Maybe, but probably not. Could Sony price gouge (hey, it’s Sony) $20 a month for streaming access to their vast library of movie titles?  Put all of those together and you’ve got a hefty monthly bill. I would probably throw up my hands and not pay any of it and buy what I wanted individually on Amazon, to be honest. (And if that becomes impossible, well I give up.)

If we have to speculate about the unrealistic scenario of a la carte cable (and we have to, because it is fun, and because I am already way to deep into this blog post to stop writing about it) I think a more likely possibility is the “top of the funnel” license holders axing the Netflix middle men. For instance, HBO already basically offers all of Time Warner’s movies, since Time Warner owns them. Viacom could package Comedy Central, MTV, and all of its Paramount Pictures movie titles (over 2,500, apparently). Fox probably has enough original content to offer its own service, unless it includes Fox News in which case no way am I paying for that. Disney could survive just selling ESPN. Comcast could ironically offer its own streaming service since it owns NBC and Universal, which together own a ton of original and sought after content. (Want to watch “I’m On A Boat?” Pay up!)

Yes, some out there are pondering a truly dark dark future. For now, I’m happy that I can just sit and watch Jon Stewart for free when my wife and I eat dinner.

How Reaganomics Has Failed Us in One Chart

Bill Moyers, one of my heroes, posted a fantastic chart at his website showing precisely how in the past forty years, average regular wages in the United States have flatlined at around $30,000 (in 2008 dollars), while the incomes of the top 1% have gradually skyrocketed. (Beginning, of course, with Reagan’s historic tax cuts, and getting worse from there through Glass-Steagall and more recent Bush tax cuts and the watered down Dodd-Frank act.)

What separates this chart from others is it highlights key legislative or political moments in time and provides explanations for them if you mouse over it. It’s one of the better graphical representations of just how badly our political system has failed the 90% of this country that primarily lives on earned wages rather than equity.

Wednesday’s Reading List

Every now and again I will try and post a list of articles and blogs I am reading. I can’t promise some of them will not be about the Giants beating the Nats, or the Dodgers losing to the Cards, and how right the world is now that that happened….

Donna Ballman’s great series on “States That Don’t Suck for Employees” — Screw You Guys, I’m Going Home

Steve Pearl’s excellent employment law updates over at The California Employment Law Blog

A harrowing and not at all surprising collection of anecdotes about the perils of working amidst the Startup goldrush — Slate

A fascinating article analyzing disturbing trends in public education “philanthropy”; this is one of those articles that puts all the random thoughts I have had in my head over the past 2 or 3 years on this subject into words — Politico

Bryce Covert’s report on a survey that shows–surprise!–rich men take more vacations than you — Think Progress

Bryce Covert strikes again–this time with a report on rampant sexual harassment in the restaurant industry (something I am all too familiar with) — Think Progress

 

 

Like a Boss

Any article about employees or bosses discussing their bossiness is going to be on my radar. Since, you know, I practice employment law and stuff. So of course an article entitled, “Why I Regret Being a Nice Boss” is going to pique my interest.

Laura Smith basically discusses why she regrets being a push-over with her former employees. As a “nice boss,” she did not address issues like tardiness or poor performance with her workers, and this caused resentment amongst others who were following the (amorphous, apparently) rules. I think she has several good points, but I quibble with her title. I cringe at the confirmation bias some bad bosses out there will have when they read that title, and walk away not getting the point.

You can still be a “nice” boss while maintaining a functional workplace. Being a “nice” boss shares some elements with being a “nice” human. Courtesy, respect, empathy, and all of those other wonderful qualities that we cherish in people that we want in our lives. It does not mean you have to be a push over, or not tell employees how they can improve. Smith sums up her flawed management style:

I allowed my coffee shop to become characterized by permissiveness. Some took advantage of this permissiveness by making up excuses for being late, or by trying to do as little work as possible. Those who didn’t take advantage became resentful of the other employees, and of me. It brought out the worst in everyone.

What Laura Smith described above, however, is not a “nice boss.” It is a weak or lazy manager. (Sorry Laura.) Part of my problem with the “nice boss” angle (and I know this was more of a creative title than anything else) is that it implies being an asshole boss is somehow better. It isn’t. Down that road is pain and inevitable lawsuits by unhappy employees. I cannot tell you how many clients walked in my door with some crazy tale about their asshole boss. Their stories about their horrible bosses are usually legal (for now). But they are walking in my door and an experienced Plaintiff’s employment lawyer (me) is asking them questions. In the course of many of these intakes, lo and behold, I find things out. “Oh, you had to work for how many hours a day? You did what during your meal breaks? Your handbook says what?” This happens all the time.

In that way, functionally Laura Smith’s “nice boss” and an asshole boss are actually very similar. The so-called “nice” (i.e., lazy and passive) boss is going to breed resentment and hostility amongst employees who perceive a willy-nilly rudderless workplace.  Employees are going to leave that workplace feeling mistreated. To me a “nice boss” is instead an active and fair boss who employees want to do good work for. Employees know what is expected of them. They know their good work is recognized. They know bad work is going to hurt the business, and they do not want that to happen.

Laura Smith counsels write ups and a more “paternalistic” micro-managing style. If that works for you, and if you can do it fairly, fine.  I can see how in food service that might be a good way to do it. Amongst franchised formula restaurants, it is standard. So you can paper up your workplace with forms and write ups and performance improvement plans like IHOP or Walmart or any other big business that has adopted the HR “death of a thousand forms” formula.  You should realize that these forms exist, however, for (a) CYA purposes; and (b) for eliminating thinking from the management equation. I see them getting employers into trouble more often than I see them improving a workplace or improving an individual worker.

In a small business you have the luxury of immediacy. You do not have to worry about employee relations across a business spanning thousands or even millions of people. You can establish more meaningful personal connections with your workers in real time. If someone is late, let them know that they cannot do that when they walk in the door. If someone does not take a break, let them know they need to take a break. (And then pay them the hour you owe them per California Labor Code 226.7.) If someone is slacking, ask them if they need help getting their work done. If someone is doing a good job, you can tell them right away. Rewards and incentives do not even always have to be monetary. I know a firm that rings a bell when someone settles a case. They ring a bell. Yay. But I imagine it feels good to be the one that gets that bell rung, regardless of any financial incentives.

I know this is tough because for many years in my old firm I supervised junior associates and law clerks.  In truth, I was not a great supervisor. I am pretty sure I was too blunt. I gave assignments, I checked them out when they were done, and I offered feedback. I sent people back to do things that were not done, partly because I did not adequately explain (or sometimes, even know) what I wanted. The extent of my management-fu was the occasional praise sandwich. (My wife tells me the proper metaphor is a shit sandwich, since you’re sandwiching in the “shit-critique” between two slices of “praise bread.” You don’t call a turkey sandwich a bread sandwich do you? But praise sandwich sounds more…appealing.) It took me a while to learn how to motivate people to want to do good work. This is an art I still have not come close to mastering. The never ending crush of business is enough to deal with.

One thing I am sure of, however: I never tried to be “nice.” If we go by Laura Smith’s definition of a “nice boss,” I am fairly certain my former subordinates at least appreciated that.

 

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