Linked List: March 26, 2021

Friday, 26 March 2021

Jack Rusher Explains NFT’s in a Way That Actually Makes Sense ★

Jack Rusher, “What Does It Mean to Buy a GIF”:

Photographic prints can be reproduced in unlimited quantities, but artists’ signatures cannot. This led to a situation where the market for art split in two, one fork for collectors and one for those only interested in the work as an experience. I would argue that this is good for everyone. Artists gained a way to sell work that would otherwise be reduced to a commodity, collectors gained access to a new and culturally vital art form, and great works of art became available to everyone at very close to the marginal cost of reproduction. […]

When viewed in this light, the nature of NFTs becomes quite clear. An NFT is a mechanism by which an artist can publicly attach their cryptographic signature to a digital work of art. In other words, it is a technology that supports in the context of digital arts the same kinds of signed editions that have existed in fine art photography for most of a century.

To say this explanation made a lightbulb turn on in my head is an understatement. NFTs are the digital equivalent of a signed copy of a photograph. You can copy the art losslessly, but you can’t copy the signature, and that signature has value to some collectors.

I’m still unconvinced that the NFTs — especially as currently implemented — aren’t a scam, and I remain firmly convinced that this initial bubble is a Ponzi scheme of sorts, but I at least have a feel for the basic idea why anyone might spend some money on one.

Head-Scratcher of the Day: The NYT Makes Hay Out of the NCAA’s Men’s and Women’s Basketball Tournament Budgets ★

Alan Blinder, reporting for The New York Times, under the outrage-seeking headline “NCAA Acknowledges $13.5 Million Budget Gap Between Men’s and Women’s Tournaments”:

The N.C.A.A. budgeted nearly double for its men’s basketball tournament in 2019 than what it planned for its women’s competition, a $13.5 million gap that will assuredly drive questions about the organization’s commitment to gender equity.

The tournaments vary substantially in their formats and popularity, and N.C.A.A. executives insist that those differences necessarily account for their budgeting decisions. But a financial summary prepared by the association and reviewed by The New York Times, which included figures that a range of college sports executives said they had never seen, showed that the N.C.A.A. devoted far more resources to the men’s tournament, which organizers said had a net income of about $865 million in 2019. The women’s tournament, officials said, lost $2.8 million, more than any other N.C.A.A. championship competition.

This is why so many people are concerned about the direction of The New York Times. The fact that the men’s tournament earned $865 million and the women’s tournament lost nearly $3 million but their budgets are only $13.5 million apart is a sign that the NCAA is committed to gender equality.

In an interview on Friday, Kathleen McNeely, the N.C.A.A.’s chief financial officer, said that organizers “really do strive to have parity” between the men’s and women’s tournaments, particularly around the student-athlete experience. But she said that public interest in the men’s competition had fueled more ticket sales and required more spending.

“The men’s tournament is just a larger tournament: 690,000 fans compared to 275,000 in 2019,” she said. “That kind of a difference is going to bring in a lot of little costs that are going to drive the difference.”

Twice the budget for twice the fans — it’s commensurate. The women’s tournament TV rights are part of a package ESPN signed for the rights to 24 different Division I championships, including women’s basketball, and are worth $36 million per year. The Times claims the NCAA values the women’s basketball tournament as being worth 16 percent of that package: about $6 million per year. The TV rights for the men’s tournament were just extended for $1.1 billion per year. That’s a factor of 183×, yet the tournament budgets differ by only 2×.

That means the Division I women’s basketball tournament generates about one-half of one percent of the money that the men’s tournament does, but gets half the budget to run its tournament. That’s a great deal for the women’s tournament — and every other sport, both men’s and women’s, in the NCAA. This Times story is clearly presented as exposing a scandal of some degree, an inequity, when the complete opposite is true: the NCAA uses the immense profits of its single spectacularly profitable tournament to fund all its other tournaments, of which 84 out of 89 lose money, according to the NCAA.

(College football is even more profitable than men’s basketball, but its weird “championship” postseason is not run by the NCAA.)