The Polymathica Founders Group

I am dedicating 2023 to the recruitment, organization and deployment of 100 founders of our subculture, Polymathica.  We will have a private discussion area within my Substack, but we will also hold Zoom meetings, etc.

This will not be a debating society.  We will initiate projects, recruit leaders, get funding, if needed, and make it all happen.  It is all about creating a parallel economy, with our own news, our own TV, our own books, our own social media, etc.

Now, the people who join the Founders Group and are successful will likely acquire very affluent lifestyle.  But, don't do it for that.  There are probably easier ways to join the 1%.  This is primarily a big deal you will be one of the Polymathica Founders.  For the 10 million or so Polymathicans you will be where it all started.

For those of you who just stumbled in, Polymathica is a subculture of Western Culture that reveres Intellectual Sophistication and engages in a lifelong pursuit it.  Intellectual Sophistication is a combination of intelligence, erudition, objectivity and discipline.  Because of this, we kind of need to be Apollonian rather than Dionysian.  We are definitely part of Western Culture and, as such, we embrace liberal (not Liberal) values.  But, we have our own take on it and one that I think most of us are quite proud.

At the core of the Founders Group will the Polymathica Central Workgroup.  Literally, we will be building a web presence that will be sort of like a combination of Amazon, Facebook, Twitter (or Gettr), Youtube (or Rumble), and more.  It won't have as many monthly users (not even close), but what it lacks there it will partially make up for in breadth.  The members of the workgroup will, upon success, definitely become wealthy, but not Zuckerberg level wealthy.

I want Polymathica Central to be a collection of subdomains, bookstores, fashion boutiques, video streaming services, social media groups, educational groups, etc. Polymathica Central will charge 'rent' for being on the domain, like a kind of virtual mall, and that will be worthwhile because if you are providing goods or services to polymathic people, that is where you will find them.  This is called network effects and is what drives the Internet.

I will spend time and energy getting this started.  However, other people in the work group will be the CEO, CIT, CFO, etc. of Polymathica Central.  I learn, I think and then I write.  To that end I will create a subdomain, The Polymathic Roundtable.  It will be comprised of about 12 of the very best Polymaths I can find.  Each of us will have a newsletter, but we will also convene round table discussions on a broad spectrum of topics.  These may be presented in print, podcast or video.  If in video, which I expect to be the norm, they will be accompanied by subscriber Super Chats.

The going rate for paid subscribers on Substack is $60, though few newsletter writers can really justify that with volume of content.  The Polymathic Roundtable will begin on Substack and be an outgrowth of my current MichaelWFerguson.Substack.com account.  If you want to support the development of Polymathica Central and/or the Polymathic Roundtable but aren't interested in becoming a Founder, your $60 per year paid subscription will be greatly appreciated.

Your $60 Polymathic Round Table paid subscription will get you premium subscription status for your choice of 5 of the 12 Round Table members.  You may procure more at $12 per year each.  This, I believe, is a fair 'fee for service' or subscription price.  My goal is to actually make this service the best source of news, analysis and commentary available anywhere.

The top ten newsletters on Substack average $2,000,000 per year of revenue.  Substack is new and that will likely increase over the next few years.  My goal for The Polymathic Roundtable is that we will eventually have 500,000 subscribers for a total revenue of 30,000,000 USD revenue.  This translates to $1,750,000 per year of income for the average Round Table member.  This is will be a usual income for Polymaths.

Polymathica Central will enable Polymaths and serve Polymathicans in a growing number of ways and the initial 100 Founders Group is what will make it all happen.  Western Culture is fragmenting and if you don't want to be stuck with the choice between Woke and Right wing, you need to support alternative futures for yourself.  Polymathica may be your preferred cultural home.

If you are interested in being a Polymathica Central Founder, you begin by becoming a Founder Subscriber.  Your annual dues are $210.  This is used to fund the organizational development process that will include advertising, promotion and administration.  We will have articles and Zoom meetings where we will discuss the subdomain productive activities that you may want to consider.  Other Founders, especially those who will construct Polymathica Central may contribute other suggestions.

The advertising process itself will involve promoting articles, encouraging readers to become free subscribers and from this group we will recruit founding members.  The membership fee for Founding Membership will finance this process.  Because of that, Founders will have access to the growing subscriber list to undertake their project.

Early on, I will encourage one or more Founders to create a subdomain for crowdfunding.  Acquiring and developing a subdomain will not be free and often may require a small, private equity round of financing.  This will not only enable our subdomain enterprises, it will provide an opportunity for substantial capital appreciation among Polymathicans.

If you are interested in becoming part of the Founding team, I suggest that you join as soon as possible.  I am limiting this group to 100 and it is best to grab your place and get to work before someone else does.  If you want to support the development of Polymathica Central and incidentally the Polymathic subculture, do join as a paid subscription to my Newsletter.  We will work on increasing the premium services that are provided to paid subscribers.  Rest assured that much of your support will be used to grow the ranks of Polymathicans.

Newsletter 1: A few points you absolutely need to know

The Internet is so overwhelmed with content that one cannot consume more than a tiny fraction of it.  That, generally, is not a problem because most of it is duplicative.  Choose your favorite content creator to present you with the standard Right and/or the standard Left narrative.  My goal is not to provide you with X number of words or Y minutes of video per time period.  Rather, my goal is to correct the most egregious misstatements within the Right and Left narratives.  Both sides 'lie to you for your own good'.  I don't condone that, especially because they get it wrong so often.

So, here are a few corrections of the most important current issues that are being reported and discussed. 

The Truth about Inflation

The U.S. Federal Reserve needs to print money - approximately 800 billion USD of it per year.  Parenthetically, the Eurozone needs to print about the same amount of Euros.  The Fed can do so directly by buying Treasuries with created money.  Or it can do it indirectly by lowering interest rates that are internal to the banking system.  This, usually, increases credit demand and allows the member banks (JP Morgan Chase, Bank of America, Wells Fargo, etc.) to loan more money using fractional reserves and thus they create more money that way.  The first method is a scalpel and because excess profits are returned to the Treasury, this method benefits the taxpayer.  The second is a blunt instrument that enriches the owners of banks.  The Federal Reserve has absolutely needed to increase the money supply in order to avoid the economic disasters that could have resulted from, first, the 2008 financial meltdown and, second, the forced closure of businesses during the 2020-2021 pandemic.  Since it absolutely had to be sure that the strategy worked, they resorted to Quantitative Easing (QE) or the buying of Treasuries to immediately and reliably infused money into the system.

Because of this, the Federal Reserve now holds about 9 trillion USD of Treasuries.  Because of this QE, the crises were, indeed, mitigated if not totally avoided.  However, now all that extra money in circulation is causing massive inflation.  The Federal Reserve can actually kill this inflation totally and completely dead by selling some (about 2 trillion USD) of its Treasuries.  Why don't they do that?  Well, they are planning on it, actually.  They just announced that they are going to start selling 98 billion USD of Treasuries per month.  However, while the Federal Reserve can effectively, either lower the inflation rate or interest rates through, Quantitative Easing or Tightening, they can't simultaneously affect both in a positive direction.  The best they can do is attempt to balance inflation and interest rates. They have also announced that they are going to increase interest rates, right now by 50 basis points (0.5%) and likely more later.

Just the signaling of rate increases has caused the Treasury interest rates to increase.  Since ten year Treasuries are the best predictor of all interest rates, including your credit card debt and mortgage, in isolation, this is not a good thing.   If they don't sell Treasuries, what is called Quantitative Tightening, inflation will continue and perhaps increase.  Since there is a lag between inflation and wage increases, higher inflation is painful to most voters.  So, in theory anyway, the Fed will try to balance the two, interest rates and inflation, in order to minimize the overall negative effect to the economy and to soothe political unrest.

In the long run the basic challenge is this.  The Federal Reserve needs to increase money supply by about 800 billion USD per year in order to maintain a healthy, growing, low inflation economy.  However, the structural deficit is about 1.5 trillion USD per year.  The Federal Reserve does not have the tools to resolve that 700 billion USD imbalance.  That must be done by Congress and their only tools are to either increase tax revenue or decrease spending.  The correct solution would probably to do a bit of each.  However, both are politically inexpedient and so the problem is left unsolved and both narratives are rife with lies.  In other words, both interest rates and inflation will likely go up to a painful level.

Reasonable people can disagree about the extent to which taxes should be increased or spending should be decreased.  But in combination, they can be used to balance the scales.  However, ignoring the problem simply won't make it go away.  If the problem is ignored, EUNA (this is happening in the Eurozone and U.K. as well) will walk blindly into extreme economic hardship.  Over time high inflation and high interest rates will result in a recession due to insufficient demand side.

Climate Sensitivity, again.

From time to time I discuss the Climate Sensitivity implicit in the models you hear about.  Changes in Solar output and albedo should be modeled, but generally aren't.  Typically, models input an increase in atmCO2 and the assumed climate sensitivity and that drives the answer.  While the IPCC shows all sorts of assumptions on CO2 output and the resultant atmCO2 levels, in fact ever since we have had accurate measures, atmCO2 has been increasing at a remarkably constant rate of 0.45% per year.  There have been all sorts of schemes, treaties and protocols, etc. but the rate of increase has remained unchanged.  That really leaves the uncertainty in the assumed climate sensitivity.  Know it and you know how much the Earth will warm (given flat solar output and no change in Earth's albedo).

In the IPCC AR5, the range for Climate Sensitivity was 1.5C to 4.5C.  In the latest IPCC AR6, the range was narrowed to 2.5C to 4.0C.  This implies an increase in Earth's temperature by 2100 of 1.5C to 3.0C.  Oddly, however, the Executive Summary goes on and on about temperatures that are up to 5C higher than today.  How do they manage this?  By assuming a much higher rate of increase in atmCO2.  While that is not impossible, it is highly implausible.  If one studies the internal forces that are responsible for the 0.45% per year increase and one wanted to argue for a change in the historical rate, one would argue that it will likely begin to decrease about mid-century, with the net carbon cycle reaching balance around the end of the 21st Century or a bit before.

Once the argument over the proper value of Climate Sensitivity is resolved, it is likely that a controversy will arise over the rate of atmCO2 increase.  There needs to be attention paid to the effects of albedo, as well.  However, right now, the argument is over Climate Sensitivity.

Peer reviewed papers describing research on Climate Sensitivity are published nearly every day and I read at least the Abstracts of all of them.  I did write about one such paper a few weeks back, but generally I do not.  First, not all of them are very compelling and second, many just aren't going to be technically accessible to most Polymathicans.  However, I develop a 'working hypothesis' on the likely value of Climate Sensitivity from all of the published information and my estimate has remained rather persistently between 2.0C and 2.5C.  In other words, I was within the IPCC AR5 published range, but I am now outside of the IPCC AR6 range.

Recently I said that the AR6 is the first report by IPCC that is overtly partisan.  One of the reasons that I say this is that the increase of the lower limit to 2.5 flies in the face of much of the published research.  In fact, like the one to which I provided a linked, most research is coming to a consensus in the 2.0C to 2.5C range.

What does this mean?  It means that, based upon best evidence, that is the range of Climate Sensitivity and, while it will result in a warmer planet, it does not support any catastrophic scenarios.  The IPCC AR6 Executive Summary, without stating it, does imply a climate catastrophe that just isn't easily supported by the evidence.  IPCC, in the immortal words of Taylor Swift, 'You Need to Calm Down'.  We are, collectively, allowing ourselves to be convinced of the advisability of a cure that is actually worse than the disease.

On Roe v Wade

A draft opinion on a SCOTUS pending case on Roe v Wade was leaked and has overcome much of the Internet and the Right and Left silo.  Ruth Bader Ginsburg's assessment that the decision was flawed was correct, though very unpopular on the Left.  SCOTUS does not rule on what laws should be enforced. It rules on the constitutionality of State and Federal laws and regulations.  It also, from time to time rules on disputes between States and between a State and the Federal government.  Clearly, the Constitution makes no mention of abortion which implies that it is a matter to be determined by the individual States.  But, of course, there are complicating issues. 

Can a right to an abortion be inferred by the existing Constitutional provisions?  This is what Roe v Wade attempted to do, through the novel interpretation of the 4th and 14th amendments.  While RBG is favor legal abortions, she could not support the justification within Roe v. wade.  This, however, does not mean that the Constitution has no applicability to the issue.  However, it is limited and, as is the case with all termination of life, the description and penalties revolving around the taking of a citizen's life is a matter for the States.  However, the rules governing whether any one individual is a citizen is a matter for the Constitution and it speaks directly to it.  However, it does not do so in a way that directly informs us on abortion. 

However, clearly, if at any point it the gestational period a fetus becomes a citizen, it will enjoy the rights of a citizen.  Also, clearly, removing it from a female's womb prematurely in a manner that unnecessarily ends its viability would be against its Constitutional rights.  By practice, a person is recognized as a citizen when a birth certificate is issued.  However, a reasonable modification to that would be that the Constitutional rights of a fetus should be recognized when it COULD be issued by its premature and intentional birthing.  To do otherwise leads to some logical contradictions.

Suppose, as an example, a female is 24 weeks pregnant and she is diagnosed with cancer.  She needs immediate treatment, but the treatment would kill the fetus.  Obviously, she wants the baby but she also wants to live.  So, her medical team, concluding that the fetus is viable, removes the fetus and places the baby in the neonatal ICU where it survives.  It, of course, has Constitutional rights as of the date of removal.  There is a clear difficulty in that a 24 week old fetus that could be removed and survive will have Constitutional rights in this case, but not in another because of the condition and desires of the mother?  That makes no sense.  If a 24 week pregnancy results in a viable fetus, it either has Constitutional protections or it doesn't.  To justify the termination of a viable fetus would require the determination that in the first case, the baby has no Constitutional protection until some set time after its birth.

So, if, in fact, the draft opinion is rendered in more or less the leaked form, the decision on abortion will, for the most part, be returned to the States.  That is certainly broadly consistent with the general tenor of the Constitution.  Like most of Europe, the States are signalling that they will allow an abortion on request until between 12 weeks to 15 weeks. There are exceptions.  Poland does not allow elective abortions.  Florida just passed a law allowing abortions to 12 weeks, reduced from the current 24 weeks.  The only States affected are those who currently allow abortion on demand later in pregnancy. 

I do not actually favor limiting pre-viability abortions for a number of reasons.  The major one has to do with the introduction of highly ambiguous reasoning.  Every State that limits abortions to 12 weeks to 15 weeks must make some sort of exception for females whose life is threatened by continuation of the pregnancy.  However, what constitutes a life threatened, while clear in many cases, is not so clear in others.  What about the claim that a continued pregnancy would threaten the females life via an increased risk of suicide?  If there were a valid logic to reducing the limit to 12 weeks to 15 weeks, then some ambiguity to what constitutes a threat could be tolerated.  This, however, is my personal assessment and as a matter of law, in the U.S. where laws are often issued by States but reviewed by SCOTUS, there is probably no legal justification for it.

An Addendum

I very much want there to be a forum by which more intellectually sophisticated content can be created, distributed and discussed.  However, at the same time, I recognize that there is far too much content out there already.  So, I want to be as efficient as possible.  I am settling in to a provisional system where I publish a weekly Newsletter on Substack and on Locals where, on Locals, the ultimate objective is to create a community of Polymathicans or intellectually sophisticated people.

I want to be the Mr. Ed of social media. 

People yakkity-yak a streak
And waste your time of day,
but Mister Ed will never speak
Unless he has something to say!

That means that my newsletter, while weekly, might be short or long depending upon how much I have to say.  Most and podcasters throw out one to three hours of content per day.  So, for financial reasons, they must have that much to say.  Since they don't, they repeat themselves a whole lot.  I won't do that.  I repeat but only as is absolutely necessary.

As I said, I am not here to say what is already being said, over and over, elsewhere.  If someone is saying something important, I will simply attach a link.  There is no reason for me to waste time saying it again.

Please encourage people to join Polymaths.Locals.com or MichaelWFerguson.Substack.  This activity is only financially justified if I have at least 10K paid subscribers and I am nowhere near that.

The Polymath Entertainment Supplement

The Polymathic Institute uses Mailchimp.com to manage its e-mail lists.  The primary use will be for the weekly PDF magazine of erudite analysis and commentary, The Polymath.  I believe that The Polymath's calculated circulation of six million will be closely approached in the three to five year time frame.  It will reach this circulation because one of its most important editorial policies is to publish articles on topics where the mediocracy gets it wrong.  Consequently, The Polymath will surprise and engage its readers.  An example can be found in the Omega Hypothesis page under 'Divine Intervention Through Synchronicity.'

Mailchimp.com provides 12 e-mails per name per month in its standard account.  The Polymath will take four or five of those leaving seven or eight e-mails per subscriber per month.  Some of that will be used for a peer reviewed, Journal of the Polymathic Institute.  We also will likely send personal invitations to Fellowship and a limited number of special communications. However, such supplemental e-mails will still leave a whole lot for other uses.

One idea, and I am truly excited about it, is The Polymath Entertainment Supplement.  Amazon and others sell books, music, videos and games on their site, generally taking 30% from the content provider, paying 4%-6% to the affiliate, and retaining 24%-26% for processing the payment and sending the content to the customer.  This is a big number that leaves plenty of room for improvement.

On Amazon content that would appeal to Polymathicans is not uncommon, but typically languishes, often selling 100 units or less per year.  On YouTube the same is true about music and video.  Creating a video on YouTube is relatively easy, but micro-niches rarely find even 1% of their market.

We can improve upon that, immensely.  By doing so we will do two very exciting things.  First, we will enable the '1,000 True Fans' concept.  Second, we will create a community of well compensated Reviewers.  We will take 25% from content producers, but we will aggressively promote their content.  Consequently, the perceived value of Polymathica for our content producers is much greater than Amazon.

Reviewers will retain 10% which is substantially better than Amazon.  However, for the 4%-6% that Amazon pays its affiliates, it still expects the affiliate to deliver the traffic.  The Polymath Entertainment Supplement is part of the Polymathica Enterprise Network and as such, the traffic is provided as part of its 'cut'.  Reviewers are paid for finding and presenting content of special interest to Polymathicans.

Polymathicans are voracious readers and their tastes generally don't conform to mainstream preferences.  Consequently, there may be a market for as many as 25 million book sales per year through the Entertainment Supplement when circulation exceeds 4 million. The $240 million in sales will go $180 million to the authors, $24 to reviewers and $36 million to The Polymathic Institute.

As a rough estimate, we may have 30 books reviewed per month and 15 reviewers.  The 360 authors will sell an average of 70,000 copies for royalties of over $500,000 per year.  Reviewers will review 24 books per year with sales of 1,680,000 copies and commissions of $1,671,600.  At first, the Reviewers will scour the low volume e-books on Amazon.com to find appropriate content.  However, over time, the authors will approach them.

The 1,000 True Fans concept is particularly amenable to the music industry.  There are literally tens of thousands of musicians who are good, but not commercially viable within any of the commercial genre.  Some may have a CD to sell or a DVD concert.  Assuming that our reviewers review two of these ($12-$15 ea) each month and the average sells 50,000 copies @ $12 ea the reviewer will earn $1,440,000. There should be sufficient activity to support 8-10 music reviewers.  Because of the many delivery modes of music it is more difficult to characterize musicians, but it should be able to support at least 200 musicians @ $350,000 per year.

There will be plenty of activity in the future for video and games but at present there are no viable business models.  The books and music reviews can be undertaken immediately, return six figure income soon after the completion of The Polymath crowd funding and seven figures within three years.

This is an opportunity worth fighting for, if it interests you.  You will search for obscure but great books and music and tell millions of people about it.  Even when you are earning seven figures it will be part time which will allow you to create your finely crafted life.

Everyone who contacts me wants to write articles for The Polymath.  I do not want to discourage them, but, frankly, very few will be successful.  To succeed, one must possess a very high level of intellectual sophistication, a penchant for thinking outside of the mainstream box and, of course, you must be a very high quality writer.

On the other hand becoming a successful Reviewer is a more realistic objective.  You need to have the persistence to find the high quality Creative and enlist them in the process.  You need to be a good, but not necessarily great, writer.  And, as you can see, the income is potentially even better than that of the Creatives you will manage.

We will probably send out two supplements so we have about four mailings left.  So, stay tuned for more ideas.  However, be sure to subscribe to the Polymath so you can be sure not to miss anything important.

Internet TV is Still Only Half Here

In 1999 I wrote an article explaining why Internet delivered TV would kill Cable and what the Industry would look like after the transition.  With Internet services, such as Netflix, the online presence of most networks, the episode and season purchase option through Amazon and others and now the subscription offering of CBS and HBO, there is little doubt that I was correct.

However, the transition is no more than half over.  Networks, for the most part, are still broadcast era artifacts that have simply replaced local cable distributors for the old local affiliate broadcasters.  Even the new networks, such as U.S.A., Fx, Syfy, etc., though never broadcast networks, still reflect that structure.

We need to take a step back and see that television has two relationships with its audience that are really quite different.  The first is the premium relationship that actually exists between the producer and the viewer.  For example, The Good Wife is really a relationship between Robert King, Ridley Scott, et alia and the viewers.  The second is the rerun library service, such as Netflix.  In both cases, the cable distributor is of no use and the Network now provides no more than marginal value added.

The first run producer has two basic needs.  First, save for those who are very established, funding for a new show is needed.  Networks no longer routinely provide funds directly.  Rather, funds are acquired to produce a pilot.  That pilot is then shopped to networks.  A network may purchase 13 or more episodes and that contract is used to acquire the remaining funds required to produce the show.  Ultimately, what the Network brings to the table is cheap and nearly universal access to viewers but, today, little more.

To put it simply, if you are a fan of Elementary, your allegiance is to the producers of the show, not CBS.  If CBS cancelled it and it started being distributed elsewhere you would have no thoughts of loyalty to CBS  You would go to wherever Elementary was being offered.  This is one of the strategic problems that networks have - almost zero brand value.

One of the problems with the network business model is that the budget available to the producers is determined by the number of viewers that the network can attract multiplied by the amount that advertisers are willing to pay in order to talk to a viewer.  The perceived value of the show by the viewer is irrelevant.

Internet delivery is different since it is the viewer who determines the value of an episode. If the show's budget needs to be $2.00 per episode, in the Network universe, the show is dead.  If viewers are willing to pay $2.00 per episode in the Internet universe the show may continue.  This ability for a highly committed subset of viewers to support a show will, over the next decade, completely transform the industry.

The beginning of the end for Networks will be when a show that they cancel, rather than going out of production, continues to be produced at a per episode fee and is marketed through Amazon, iTunes, Netflix and blogs and magazines with proper demographics.  If the marketers 'take' is less than that of the Networks, the 'producer to viewer' business model will grow and the network business model will die or more likely transform.

Today Netflix, Amazon and Hulu provide access to programming, mostly shows in syndication.  Netflix provides some limited original programming.  This business model needs to change as well.  The problem is that your subscription pays for programming that you don't want to watch.  As a customer, it is in your best interest to subscribe to a service whose subscription base is homogeneous and whose viewing preferences are most like your own.

Over the next five to ten years, the broadcast and cable networks, Netflix, Hulu, Amazon and some new entrants will converge on a business model that will offer a monthly subscription that will provide unlimited access to a library of syndicated shows and older movies along with episode or season pass purchase for new shows, video magazines, sporting and other events.  Right now, with Amazon Prime and Instant Access, Amazon is the closest.

Over time, because of the market pressures mentioned, these various Internet TV providers will each find their own niche.  As they do, they will collide with Internet sites that already serve the niche and will find it profitable to offer Internet TV.  An example is Huffington Post.  It already has a sophisticated web presence with over 100 million unique visitors and a strong urban, college educated, 'soft Left' profile.  'HuffTV' would be a relatively easy start up.

There will be some interesting transitional issues.  At market maturity there will be a number of enterprises each of which will have access to a specific demographic.  They will offer a first run and rerun library specifically tailored to its subscribers.  However, at present first run contracts and syndication ownership does not conform well to a market niche segmentation.

For example, the new subscription service offered by CBS, through its CBS Television Distribution, owns an impressive library of syndicated shows that will make it an instant contender in the streaming rerun market.  However, much of it doesn't match well with its current first run lineup that skews heavily to the more intellectual crime/investigation genre.  On the other hand, websites that have a strong market niche presence, such as Huffington Post, will need to acquire both a syndication and first run library.

While this will lead to a period of increased acquisition and divestiture, it has been the general pattern, albeit at a lower level, with syndicated shows in the past and doesn't cause much of a change from business as usual.  The significant change will be with first run shows.  Because networks have controlled the industry in the past, first run shows have traditionally been exclusive to one network.  As producers take control of the industry, they will see benefit in striking distribution deals with several distributors.

Polymathica, though targeted at a much smaller market than Huff Post, still represents a wonderful opportunity to enable refined, erudite programming that in today's market simply couldn't get produced.  It will simultaneously enable several thousand Knowledge Class Polymathican careers.  Additionally, most shows will be financed through crowd funding which will provide high return potential to its small investors.

So, this impending development is significant on two levels as investment intelligence and as career opportunities. First, television is a growing and volatile industry that has been dominated by a handful of companies.  While cable television is going to die, the same companies typically provide Internet service.  As people transition to Internet TV, they will need to upgrade to higher bandwidth service.  While cable companies may see their revenue decrease, their operating income may actually increase.

The broadcast and cable networks will need to choose a market niche.  While that means that their viewership will almost surely decrease, their revenues may actually increase.  An ad supported show will typically generate about 60¢ per viewer, which must be shared with a cable, satellite or broadcast distributor.  A show that is distributed over the internet via a season pass will typically create $2.00 to $2.50 of revenue and the distribution costs decrease.

While the industry is in turmoil, it does not present much in the way of investment opportunities.  The existing mainstream players will lose viewers, but will increase its revenue and income per viewer.  When I wrote the 1999 article, I thought that AT&T was in the best strategic position.  Now, it appears with the acquisition of the NBC family of businesses, Comcast may be best positioned.

The real opportunities will reside in new, smaller market niches, such as Polymathica, whose viewers were disenfranchised in the cable TV era, but will be enabled in the Internet TV era.  PolymathicaTV will be joined by ZeitgeistTV, PolyamoryTV, ChristianTV, GothTV, AryanTV, AynrandianTV, SingularityTV, etc. that, in total, will likely capture about 15% of the market.

I estimate that PolymathicaTV will capture about 0.7% of the market, or about 15 million people.  PolymathicaRerun will, at this level, generate about 1.4 billion USD in revenues.  The majority of this revenue will accrue to the owners of content.   PolymathicaTV should be able to support about 100 shows at an average of 1,000,000 viewers.  This 4.5 billion USD of annual revenue will support about 2,500 FTE career opportunities.

It will also create impressive private equity opportunities as well.  Creators of a show will acquire enough funds to produce a pilot and some marketing funds, say 1.0 million USD in the anticipation that some viewers of the pilot will purchase a season pass which will generate sufficient funds to produce the show.  Most participants in the project, including the creators, will be paid scale or siilar, against a percent of revenue.  This allows low risk and potentially high returns for both investors and participants.

Skills needed for a successful team include:

• Production
• Writing
• Directing
• Acting
• Casting
• Sets
• Wardrobe
• Editing
• Musical composition
• Special effects
• Sound

The principals will typically have mastery of several of these skills.  The deal structure will usually be gross margin = Revenue - non-equity expenses.  The Gross Margin will be broken into 10,000 shares and allocated to the equity participants.  

Crowd funders for most projects will have a 1,000 USD minimum investment requirement, with $500 increments above that. They will be pitched with a proforma statement.  For example, the show may anticipate one million viewers with an average season pass of 45 USD.  Distribution services takes 25% and non equity costs are 4 million USD for a gross margin of 29,750,000 USD or 2,975 USD.  A 1,000 USD investment, receiving two shares, will earn 5,950 USD per year for the run of the show.  If the show gains 1.5. Million viewers the 1,000 USD investor will receive 9,325 USD per year for the run of the show.

Because of the nearly immediate high return potential and the small amount risked, investors do not need to be risk averse.  An investor who invests in five projects in a year and hits on one will be cash flow positive the first year and have 100% return for the run of the show.  Because of this, a lot of pilots will be produced which can be laid off to the rerun service if they don't succeed thus reducing risk.

This is an exciting end game scenario that creates thousands of opportunities within Polymathica and tens of thousands of opportunities in other market niches.  Readers who are interested in polymathicaTV either as a participant or investor should subscribe to The Polymath.