Blockbuster video declared bankruptcy earlier this month. It didn't come as a surprise to anyone.
Back in the 80's Blockbuster emerged as the dominant player in the new videotape rental market. Blockbuster successfully drove much of the independent rental shops out of business despite the fact that the independent shops held a big advantage -- they rented porn. But, Blockbuster had more capital and were able to stock more recent releases, which were in high demand by most consumers. By 1994 Blockbuster was worth $8.4 billion and blockbuster brick and mortar stores dotted the landscape. Blockbuster had achieved monopoly power in their industry.The problem with having monopoly power is that companies often begin acting like a monopolists,begin rent seeking, and offering the product they want to sell as opposed to the product the customer wants to buy. Blockbuster fell right into this trap by, among other things, adopting strict and onerous late fees policies, skewing their movie selecting to new releases, and drastically limiting the available selection of older movies (the long tail). They also became content in their position of dominance and sluggish in adopting new technology, such as switching over to dvds and taking advantage of the Internet.
Our public schools are stuck in a Blockbuster world. Public schools exist to serve themselves, not their customers -- the students, parents, and the public. I have profoundly different views than some edu-pundits, but the one thing we tend to agree on is that the students, parents, and the the public are not being well served by the public schools, though we disagree on the means and ends of the needed improvement. Almost no one believes that public schools are using technology effectively, for example.
Blockbuster had settled into a mode of business that was good for Blockbuster and not so good for consumers. Public Schools have done the same. The only real difference is that public schools are immune to market forces and can only be dislodged from their heavily entrenched position via political forces. Good luck with that.
Blockbuster, in contrast, was not so insulated from market forces. It didn't take long for other providers to enter the market and begin providing the products and services consumers wanted. Look at what happened.
Netflix and other providers ate Blockbuster's lunch in less than ten years. Netflix won for the simple reason that they offered a better service. No late fees. No trudging out to the local store with it's limited selection to return movies. No limited time period for watching the movie you just rented.
That must have been incredibly disruptive to Blockbuster's "stakeholders." But, did you read any tearful op-eds about how the institution of Blockbuster must be saved to protect the public good of readily available video rentals? Either did I.
Loser: Blockbuster
Winner(s): Consumers and Netflix (as long as they stay ahead of the competition)
Today, Blockbuster is a husk of its former self while Netflix thrives. And, Netflix can't rest on it's laurels because it is already attracting fierce competition.
Winner (again): Consumers.
Do you think this drastic change (which benefited consumers greatly) would have occurred if a) the government ran Blockbuster or b) Blockbuster was able to get regulations passed granting a monopoly to itself (think phone company) or otherwise limiting competition?
13 comments:
C'mon, Ken. Likening a single corporation to a public institution is ludicrous. There is a long history of "rich" corporations falling by the wayside because of advancing technology. Think of the US auto industry for a recent example.
Netflex is now in the same position that Blockbuster was earlier.
Public schools don't exist to serve themselves, They exist to serve the public. Is there something about public that you don't understand. And the public schools don't have customers Students, parents, and the public are just that. They aren't customers.
Almost no one believes that public schools are using technology effectively.
"Technology" in every sector other than education refers to "how to"--reliably accomplishing specified ends with defined means.
There is little or no technology in the education sector. Rather teachers are obligated to make equipment--typically electronic devices--work effectively.
Ken-Are public health services a monopoly? Fire fighting? Police? State, local and Federal Governments? Parks and recreation areas?
In each case there are "private alternatives" There are also private schools. No one is proposing nationalizing private schools.
The thing is, not all of the public can afford the luxury of private services. All are not born or grow up "equal"
Unless you are an anarchist, some form of government is necessary. The only questions are in the details.
My bet is that the politics and economics near term will bet the federal government out of trying to legislatively mandate "quality education." But that's a whole nother story
Likening a single corporation to a public institution is ludicrous... Public schools don't exist to serve themselves, They exist to serve the public.
Dick, public schools provide a service and that's it. Calling it a public institution doesn't change that reality. Yes, providing education services benefits the public but so does providing entertainment services.
And, as we both agree, to the extent that they are failing to provide effective instructional services they are failing at their public function. Always have.
And for the record public schools are serving themselves at the expense of the public; that's the problem inherent in the current system.
There is a long history of "rich" corporations falling by the wayside because of advancing technology.
Is that a bad thing for consumers, or as you put it, the public?
There's also a long history of "public institutions" existing well past the point when they became obsolete.
Also, the advancement of technology didn't do Blockbuster in. Failing to adapt to the advance of technology did, among other things. Blockbuster had the opportunity to buy Netflix and passed it up. Walmart also failed in this market.
Netflex is now in the same position that Blockbuster was earlier.
Right and they know it. Which is why they are busy improving and growing their video streaming services and capabilities.
And the public schools don't have customers. Students, parents, and the public are just that. They aren't customers.
They'd much rather be customers and treated as such.
There is little or no technology in the education sector.
And why do you suppose that is, Dick?
In each case there are "private alternatives" There are also private schools. No one is proposing nationalizing private schools.
When it comes to monopolists and monopsonists, having market power is the key factor, not the presence of a few "competitors."
At one point Microsoft was propping up Apple so it could struggle along so they'd have a "competitor" in the market.
It's not a free market when you have to pay your tribute to the monopolist before you can buy alternate services. Why do you think charter schools have grown so quickly, certainly not due to the improved instructional services.
The thing is, not all of the public can afford the luxury of private services.
This is a separate issue. I'm not proposing that we end education subsidies to the poor. (Though I think I can make a good argument that the subsidies are serving to increase the price of education by the amount of the subsidies. See the secondary education markets and the current bubble that has been created.)
Unless you are an anarchist, some form of government is necessary
I don't remember arguing that government shouldn't be in the business of regulating education providers. That is the proper role of government. Hopefully those regulations will serve to maximize competition.
public schools provide a service and that's it. Calling it a public institution doesn't change that reality. Yes, providing education services benefits the public but so does providing entertainment services.
The institution of public schools has a long history. The "services" the institution is expected to provide have changed have morphed over the years. Until recent stabs at "privatization of all schools" the distinction in the US has been between "public schools" and "private schools" Per the US Constitution, education is a state and local matter, but the Feds have increasingly encroached and are currently bashing the institution.
They'd much rather be customers and treated as such.
Who told you that, Ken? Polls indicate that by and large, parents are satisfied with "their" school. There is not general support for "vouchers."
There is little or no technology in the education sector.
And why do you suppose that is, Dick?
Well, for at least three reasons.
One. The "teacher" is viewed as "the most important variable" A "high quality teacher can make any program work."
Two. The private sector invests no money in R&D to to create education "how to."
Three. The govt-acad-pub trinity proscribed all support of the D in educational R&C in 1986. The Institute of Educational Sciences mentions research and evaluation, but leapfrogs development.
Why do you think charter schools have grown so quickly, certainly not due to the improved instructional services.
I don't see that they have "grown rapidly. But are you contending that charter schools are there to provide weak competition to public schools and thereof sustain the "government monopoly."
I understood it was the teachers unions that were the obstacles to "reform."
Informative essay in Oct 3 issue of NYTimes, Hegel on Wall Street that bears on this matter. The crux:
Hegel’s emphatic but paradoxical way of stating this is to say that if the free market individualist acts “in [his] own self-interest, [he] simply does not know what [he] is doing, and if [he] affirms that all men act in their own self-interest, [he] merely asserts that all men are not really aware of what acting really amounts to.” For Hegel, the idea of unconditioned rational self-interest — of, say, acting solely on the motive of making a maximal profit — simply mistakes what human action is or could be, and is thus rationally unintelligible.
I'm not sure that "having a long history" justifies having a continued history. Perhaps we should take some lessons from Finland and Sweden. The services have changed but the instructional services have never been very good.
People are generally satisfied, but as you point out, schools provide many non-instructional services and provide them well enough, if not economically. They've never been very good at providing the instructional services. And, of course, many children do well even with poor instruction. So, it's not surprising that people generally like their local school. Also, in more recent polls the grades people are giving to their local schools is decreasing.
Vouchers are for other people's kids (read "poor kids"), that's why there isn't much support. Vouches are viewed as just another taxpayer expense. And, I'm not proposing vouchers -- I'm proposing giving funding directly to parents and letting them pick the school, including their own public school, they send their kids to. The object is to give people control and to thereby promote competition between schools.
So if teachers are viewed as the most important variable why aren't schools using technology to virtually bring these great teachers to schools?
Why should the private sector spend resources on R&D on effective practices when schools aren't asking for it? Solid research-based curricula exist, but aren't being selected by educators. The first rule of business is to give the customer what he wants, not what you want him to want.
I'm not sure what the third point has to do with the adoption of new technology.
No. charter schools are not there to provide weak competition top sustain the current monopoly. But there are not enough charter schools in existence (due mostly to caps on growth) to provide sufficient competition.
Teacher's unions are a well-funded special interest and act in their own self interest. The problem with our current system is that the interest of teachers is not aligned with the interest of parents/students (the customers).
Hegel's "common good" theory hasn't worked well in practice. See the history or fascism, communism, socialism, and progressivism in the 20th century.
Dick, two questions. How do you propose we get from point A to point B in our current system? How is that change sustained when your ideological enemies gain control, of government and dismantle your "reforms"?
Dick, two questions. How do you propose we get from point A to point B in our current system? How is that change sustained when your ideological enemies gain control, of government and dismantle your "reforms"?
Well, the long answers are addressed in papers accessible on the Social Science Research Network
http://ssrn.com/author=1199505
But I can give short answers:
A: Essentially use Planned Variations methodology that was used in Follow Through years ago but was abandoned for professional/political reasons.
It involves only specifying:
--What do you want to do instructionally?
--How are you going to know that it can be done reliably?
That sounds easy. But it's altogether different than current "reform" methodology that chases wishful "goals," only to discover years later that "nothing changed."
B. The consequences of A are that the "change" is operational, not rhetorical. And the instructional products/protocols fly on their own merits rather than being legislated.
I'm with you on the planned variation bit, Dick. But I don't see how you go from planned variation to getting schools to adopt the winning models and shun the losers. Look at it this way, we already have pretty good evidence on some winning models and schools are still sticking with the losers.
I don't see how you go from planned variation to getting schools to adopt the winning models and shun the losers
The govt-acad-pub trinity was able to bury the results of Follow Through and also to fuggedabout the methodology.
One of the important but unnoticed positive consequences of NCLB was that it raised "education" from a local level of media attention to a national level.
EdWeek and bloggers such as you not only follow the money and also follow the action. We can expect that the reliable models will receive more attention and that the flaws in the vapor models will not go unnoticed.
Another consideration is that in yesteryear (though today) the reliance was/is on instructionally insensitive standardized tests. The instructional accomplishments of the updated methodology will be transparent.
Ken states:
And, I'm not proposing vouchers -- I'm proposing giving funding directly to parents and letting them pick the school, including their own public school, they send their kids to. The object is to give people control and to thereby promote competition between schools.
How does the gov't figure out how much each family gets?
Do surburban kids get the same as city kids? Will the amount be enough for private schools?
Short of a mandate, Dick, I don't see how any school will voluntarily do something they don't want to do regardless of what the research says. And if they do adopt a research based program, they will subvert it unless there is a mechanism in place to reliably predict the expected results. This will require an elaborate compliance mechanism and we know how well that will go over and can expect the same sort of issues we see with NLCB. The incentives are simply not aligned to accomplish what you want to accomplish.
Kathy, the simplest, though not necessarily the best or most efficient, solution would be to cut each parent a "voucher" per child equivalent to the per pupil expense in their home school district. That maintains the status quo funding.
The updated PV methodology doesn't involve "research" in the abstract or "predicting results." It entail testing instructional product/protocols in the same way we test product/protocols in other sectors of life--in a natual school environment
Rather than trying to distinguish between "effective and ineffective" teachers, the methodology distinguishes between effective and ineffective product/protocols.
The mistaken conclusion from the First Grade Reading Study in the early 1960's was and is that "the teacher is the most important variable." Teachers unions glommed on to this, as did teacher training institutions, and publishers.
Corallary faulty conclusions were/are "a good teacher can make any program work" and "'mixed methods are necessary, because all children learn differently.
Given these beliefs, the variability (which is the only consistency noted) is inevitable.
This isn't the place to delve into the nuts and bolts of updated planned variations methodology.
If you can keep your disbelief in suspension for a couple of weeks, I'll try to come up with something more concrete to consider.
That's too bad. I can still remember that Blockbuster used to be so popular back in the days. Now that the power of the internet is dominant, Blockbuster has no room to compete with Netflix.
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