Did everyone here catch the Editorial Observer item in Sunday’s New York Times?: A New Magazine’s Rebellious Credo: Void the Warranty! The article recounted the launch of Make Magazine, a throwback quarterly that celebrates the almost-forgotten idea of the creative impulse inside us all.

Make, its makers will tell you, is part of a grass-roots rebellion against consumer technology that they say stifles ingenuity by discouraging end-user modification. To these restless minds, increasingly sophisticated consumer products have forced users into a kind of stupefied passivity, with nothing to do but replace batteries and update software, to point and click into a zone of blissed-out consumption. … In this world, to tinker – to open the case, to fiddle with wires and see what happens – is to rebel.

My thought, after reading the article, was: Yes! The freedom to tinker! It’s no longer a concept confined to a narrow set of technologists, geeks and academics. O’Reilly is a tech publishing house, sure, but surely this periodical has tapped into a nascent impulse among some segment of Americans to throw off the shackles of consumerism and to hark back to a time when we were co-creators of our products.

I remember watching my dad tool around with short-band radio and spend weekends under the hood of his car. What tinkering skill sets will I pass along to my 6-year-old? At the moment, the best I have to offer is, alas, a set of tools in the Darknet that I can point him to, given the widening disconnect between our laws and the kinds of things people want to do with digital technology.

But perhaps we can think of tinkering in a larger context: as a reformulation of our media culture. In that sense, creating a work of personal media (and perhaps showing it off on one’s blog or a site like Ourmedia) is an affirmative action that looms larger than it may at first seem. Clinton talks (in the comments below) about a media revolution that’s about honesty and substance, and that taps into a sentiment I bring up often in my talks about personal media: the genuineness and authenticity that we’re seeking to connect with and that’s missing from the realm of commercial-driven mass media. Even the failings can hold meaning because they’re true and genuine. I’m not all that concerned with figuring out a business model for the big boys to replace the current regime; someone will do that, whether it involves advertising, subscription or some new model we haven’t thought of yet. What we should be concerned about is breaking the stranglehold that the major media outlets (500 channels and nothing on) have on our living rooms. I do believe that when a wealth of Internet programming comes gushing through our TV sets, American culture will change – for the better.

We’ll be a more fragmented society, yes, but we’ll also see more and more young people picking up the tools of digital creativity. And becoming tinkerers.

The technology for measuring TV and radio audiences is about to change in important ways, according to a long and interesting article, in yesterday’s New York Times Magazine, by Jon Gertner. This will have implications for websites, online media, and public life as well.

Standard audience-measurement technology, as used in the past by Nielsen and Arbitron, paid a few consumers to keep diaries of which TV and radio stations they watched and listened to, and when. Newer technology, such as Nielsen’s “people meters”, actually connect to TVs and measure when they are on and which channel they are tuned to; family members are asked to press buttons saying when they start and stop watching. People meter results were surprisingly different than diary results, perhaps because people wrote in their diaries the shows they planned to watch, or the shows they liked, or the shows they thought others would want them to be watching, rather than the shows they really did watch.

The hot new thing in audience measurement involves putting quiet watermarks (i.e., distinctive audio markers) in the background of shows that are broadcast, and then paying consumers to wear beeper-like devices that record the watermarks they hear. A key advantage of this technology, from the audience monitor’s viewpoint, is that it records what the person hears whereever they go. For example, current Nielsen ratings for TV only measure what people see on their own television at home. Anything seen or heard in a public place, or on the Internet, doesn’t factor into the ratings. That is going to change.

Another use of the new technology puts a distinctive watermark in each advertisement, and then record which ads people hear. When this happens – and it seems inevitable that it will – advertisers will be willing to pay more for audio ads in public places and on the Net, because they’ll be able to measure the effect of those ads. Audio ads will no longer be coupled to radio and TV stations, but will be deliverable by anybody who has people nearby. This will mean, inevitably, that we’ll hear more audio ads in public places and on the Net. That’ll be annoying.

Worse yet, by measuring what people actually hear, the technologies will strengthen advertisers’ incentives to deliver ads in ways that defeat the standard measures we use to skip or avoid them. No longer will advertisers measure attempts to deliver audio ads; now they’ll measure success in delivering sound waves to our ears. So we’ll hear more and more audio ads in captive-audience situations like elevators, taxicabs, and doctors’ waiting rooms. Won’t that be nice?

Sony says it wants to create a system that does for movies what Apple’s iTunes does for music, according to a CNET story by Stefanie Olsen.

Unfortunately Sony doesn’t seem to understand what Apple did:

“We want to set business models, pricing models, distribution models like (Apple Computer CEO Steve) Jobs did for music, but for the film industry,” Michael Arrieta, senior vice president of Sony Pictures, said at the Digital Hollywood conference here.

What Apple actually did was to think about what customers wanted and then strive to provide it. Customers wanted one-click buying, ownership of songs rather than rental, tranferrability to different devices, and an attractive price. Apple couldn’t provide customers’ dream service, but they got pretty close. Apple realized that it didn’t have carte blanche to choose the business model, pricing model, and distribution model that Apple would like best. This is what is supposed to happen in competitive markets – market pressure forcing companies to give customers what they want.

Compare to Sony’s own digital music strategy, which looked like an attempt to construct Sony’s dream world. Customers didn’t want to live in that world, so they didn’t buy into Sony’s system. If Sony wants a different result this time, it’ll have to change its strategy.

Derek Slater, responding to the recent Cato paper on DRM technologies, raises an important question: How competitive is the record industry?

The Cato paper argues that market competition will blunt the possible negative effects of DRM on consumers. The theory is that a variety of competing DRM systems will emerge for online music. These systems will offer differing levels of flexibility to consumers. They will face market pressure to meet consumers’ needs, because consumers can choose which one to buy. Record companies will face competitive pressure to license their music via the DRM systems that consumers want to buy. If the DRM market is competitive, and the music market is competitive, then market forces will foster a reasonable DRM technology.

This theory has much to recommend it. But the theory works, of course, only if the music business really is competitive. If the record companies act as a cartel, they can use the resulting monopoly power to dictate the design of DRM systems, regardless of consumer preferences. Tellingly, the Cato paper does not bother to argue that the major record companies behave competitively in this respect. Instead, the section on record company competition (p. 6) talks almost exclusively about indie labels, which account for only a small piece of the overall market.

How can we tell whether the record industry is responding competitively to DRM? An interesting natural experiment is about to start. MP3Tunes, a new startup headed by serial entrepreneur Michael Robertson, is launching a new music service that sells songs in MP3 format. Will the major record companies license their catalogs for sale on MP3Tunes?

In a competitive market, they would license to MP3Tunes. There are surely some customers who are willing to pay for music but don’t want to accept the hassles of other online music services. MP3Tunes will extract revenue from these customers.

You may object that the record companies won’t sell their content in an unprotected format. But of course they already do so, and in fact most of their revenue comes from sales in the unprotected CD format. And they can’t rationally be worried that their existing catalogs will leak to the P2P networks – that already happened, long ago. It’s hard to see how licensing their existing catalogs to MP3Tunes would make the P2P infringement problem any worse.

The record companies may feel that other music services meet their needs better, for example by increasing the likelihood that consumers will have to repurchase the same song later. These factors might affect the price they offer MP3Tunes, but they shouldn’t preclude negotiations altogether. In a competitive market, producers have to offer the products that consumers want, not the products the producers like.

It’s hard to see any economically rational reason for a major record company to refuse, categorically, to deal with MP3Tunes – unless we assume that the major record companies act as a cartel. That’s why the record industry’s response to MP3Tunes will tell us how competitive that industry really is.

(Let me preempt some rebuttals by pointing out that if you want to argue about what would happen in a competitive market, your argument cannot be based on assertions about what the record industry, as a whole, wants or needs. Assuming that “the record industry” is an actor whose needs, desires, or plans matter is tantamount to assuming that the industry is in fact a cartel. Nor can you assume that any individual company in a competitive market cares about the fortunes of the industry as a whole, as opposed to its own selfish interests. Much of the discourse about the record industry assumes, implicitly, that it is a cartel. If you want to rebut my argument about how a competitive industry would behave, be very careful to avoid adopting that assumption.)