Reading Passage 2

Emma Duncan discusses the potential effects on the entertainment industry of the digital revolution

A Since moving pictures were invented a century ago, a new way of distributing entertainment to consumers has emerged about once every generation. Each such innovation has changed the industry irreversibly; each has been accompanied by a period of fear mixed with exhilaration. The arrival of digital technology, which translates music, pictures, and text into the zeros and ones of computer language, marks one of those periods.

B This may sound familiar, because the digital revolution, and the explosion of choice that would go with it, has been heralded for some time. In 1992, John Malone, chief executive of TCI, an American cable giant, welcomed the '500-channel universe'. Digital television was about to deliver everything except pizzas to people's living rooms. When the entertainment companies tried out the technology, it worked fine - but not at a price that people were prepared to pay.

C Those 500 channels eventually arrived but via the Internet and the PC rather than through television. The digital revolution was starting to affect the entertainment business in unexpected ways. Eventually, it will change every aspect of it, from the way cartoons are made to the way films are screened to the way people buy music. That much is clear. What nobody is sure of is how it will affect the economics of the business.

D New technologies always contain within them both threats and opportunities. They have the potential both to make the companies in the business a great deal richer and to sweep them away. Old companies always fear new technology. Hollywood was hostile to television, television terrified by the VCR. Go back far enough, points out Hal Varian, an economist at the University of California at Berkeley, and you find publishers complaining that 'circulating libraries' would cannibalize their sales. Yet whenever a new technology has come in, it has made more money for existing entertainment companies. The proliferation of the means of distribution results, gratifyingly, in the proliferation of dollars, pounds, pesetas, and the rest to pay for it.

E All the same, there is something in the old companies' fears. New technologies may not threaten their lives, but they usually change their role. Once television became widespread, film and radio stopped being the staple form of entertainment. Cable television has undermined the power of the broadcasters. And as power has shifted the movie studios, the radio companies and the television broadcasters have been swallowed up. These days, the grand old names of entertainment have more resonance than power. Paramount is part of Viacom, a cable company; Universal, part of Seagram, a drinks-and-entertainment company; MGM, once the roaring lion of Hollywood, has been reduced to a whisper because it is not part of one of the giants. And RCA, once the most important broadcasting company in the world, is now a recording label belonging to Bertelsmann, a large German entertainment company.

F Part of the reason why incumbents got pushed aside was that they did not see what was coming. But they also faced a tighter regulatory environment than the present one. In America, laws preventing television broadcasters from owning programme companies were repealed earlier this decade, allowing the creation of vertically integrated businesses. Greater freedom, combined with a sense of history, prompted the smarter companies in the entertainment business to re-invent themselves. They saw what happened to those of their predecessors who were stuck with one form of distribution.

So, these days, the powers in the entertainment business are no longer movie studios, or television broadcasters, or publishers; all those businesses have become part of bigger businesses still, companies that can both create content and distribute it in a range of different ways.

G Out of all this, seven huge entertainment companies have emerged - Time Warner, Walt Disney, Bertelsmann, Viacom, News Corp, Seagram and Sony. They cover pretty well every bit of the entertainment business except pornography. Three are American, one is Australian, one Canadian, one German and one Japanese. 'What you are seeing', says Christopher Dixon, managing director of media research at PaineWebber, a stockbroker, 'is the creation of a global oligopoly.

It happened to the oil and automotive businesses earlier this century; now it is happening to the entertainment business.' It remains to be seen whether the latest technology will weaken those great companies, or make them stronger than ever.

Section 2: Questions 14-26

What do we mean by being ‘talented’ or ‘gifted’? The most obvious way is to look at the work someone does and if they are capable of significant success, label them as talented. The purely quantitative route - ‘percentage definition’ - looks not at individuals, but at simple percentages, such as the top five percent of the population, and labels them - by definition - as gifted. This definition has fallen from favor, eclipsed by the advent of IQ tests, favored by luminaries such as Professor Hans Eysenck, where a series of written or verbal tests of general intelligence leads to a score of intelligence.

The IQ test has been eclipsed in turn. Most people studying intelligence and creativity in the new millennium now prefer a broader definition, using a multifaceted approach where talents in many areas are recognized rather than purely concentrating on academic achievement. If we are therefore assuming that talented, creative or gifted individuals may need to be assessed across a range of abilities, does this mean intelligence can run in families as a genetic or inherited tendency? Mental dysfunction - such as schizophrenia - can, so is an efficient mental capacity passed on from parent to child?

Animal experiments throw some light on this question, and on the whole area of whether it is genetics, the environment, or a combination of the two that allows for intelligence and creative ability. Different strains of rats show great differences in intelligence or ‘rat reasoning’. If these are brought up in normal conditions and then mn through a maze to reach a food goal, the ‘bright’ strain makes far fewer wrong turns that the ‘dull’ ones. But if the environment is made dull and boring the number of errors becomes equal. Return the rats to an exciting maze and the discrepancy returns as before - but is much smaller. In other words, a dull rat in a stimulating environment will almost do as well as a bright rat who is bored in a normal one. This principle applies to humans too - someone may be born with innate intelligence, but their environment probably has the final say over whether they become creative or even a genius.

Evidence now exists that most young children, if given enough opportunities and encouragement, are able to achieve significant and sustainable levels of academic or sporting prowess. Bright or creative children are often physically very active at the same time, and so may receive more parental attention as a result - almost by default - in order to ensure their safety. They may also talk earlier, and this, in turn, breeds parental interest. This can sometimes cause problems with other siblings who may feel jealous even though they themselves may be bright. Their creative talents may be undervalued and so never come to fruition. Two themes seem to run through famously creative families as a result. The first is that the parents were able to identify the talents of each child, and nurture and encourage these accordingly but in an even-handed manner. Individual differences were encouraged, and friendly sibling rivalry was not seen as a particular problem. If the father is, say, a famous actor, there is no undue pressure for his children to follow him onto the boards, but instead, their chosen interests are encouraged. There need not even by any obvious talent in such a family since there always needs to be someone who sets the family career in motion, as in the case of the Sheen acting dynasty.

Martin Sheen was the seventh of ten children born to a Spanish immigrant father and an Irish mother. Despite intense parental disapproval he turned his back on entrance exams to university and borrowed cash from a local priest to start a fledgling acting career. His acting successes in films such as Badlands and Apocalypse Now made him one of the most highly-regarded actors of the 1970s. Three sons - Emilio Estevez, Ramon Estevez, and Charlie Sheen - have followed him into the profession as a consequence of being inspired by his motivation and enthusiasm.

A stream seems to run through creative families. Such children are not necessarily smothered with love from their parents. They feel loved and wanted, and are secure in their home, but are often more surrounded by an atmosphere of work and where following a calling appears to be important. They may see from their parents that it takes time and dedication to be master of a craft, and so are in less of a hurry to achieve for themselves once they start to work.

The generation of creativity is complex: it is a mixture of genetics, the environment, parental teaching, and luck that determines how successful or talented family members are. This last point - luck - is often not mentioned where talent is concerned but plays an undoubted part. Mozart, considered by many to be the finest composer of all time, was lucky to be living in an age that encouraged the writing of music. He was brought up surrounded by it, his father was a musician who encouraged him to the point of giving up his job to promote his child genius, and he learned musical composition with frightening speed - the speed of a genius. Mozart himself simply wanted to create the finest music ever written but did not necessarily view himself as a genius - he could write sublime music at will, and so often preferred to lead a hedonistic lifestyle that he found more exciting than writing music to order.

Albert Einstein and Bill Gates are two more examples of people whose talents have blossomed by virtue of the times they were living in. Einstein was a solitary, somewhat slow child who had affection at home but whose phenomenal intelligence emerged without any obvious parental input. This may have been partly due to the fact that at the start of the 20th Century a lot of the Newtonian laws of physics were being questioned, leaving a fertile ground for ideas such as his to be developed. Bill Gates may have had the creative vision to develop Microsoft, but without the new computer age dawning at the same time, he may never have achieved the position on the world stage he now occupies.

Section 3: Questions 27-40