A Brief Bit on Taiwan As a Thing, Musing on Vtuber as Economic Output

I never really wrote about vtubers, but it’s interesting to note that recently Hololive/Cover suspended two of their vtubers for upsetting the Chinese mainland audience by mentioning Taiwan in the context of countries. It’s a pretty common shorthand to refer to economically distinct regions on internet platforms because there are places in this world that are run by different commercial laws despite those places not being really countries. Maybe this is just a very short explainer on both Taiwan and reporting data on the internet.

Places like the Vatican are city-states that are not fully a nation but are run by distinct set of local laws. Places like Hong Kong are administrative regions of other countries, which runs on different laws than their mother countries. Places like Taiwan are effectively different countries but are not legally recognized as independent countries by the UN and most other countries (although some countries do recognize them).

For sake of ease, viewer analytics for ads will list entities, viewers, etc., by these legal boundaries. It’s not “country” but there are few terms more suited.

The PRC, as a stipulation of doing business with them, require their trade partners to follow the same political stance in regards to Taiwan. I think the situation always escalate fast because, as per its communist tradition, being called out by the common folk was the original gaslighting social media mob that you see online today. It just happens that there are so many people in China that the effect was a lot more immediately felt in more places. Normally you would just have reasonable government agencies or some more professional parties regulating speech do this, but out comes the mobs.

As for Cover’s actions, that seems rather business as usual. I think when you have virtual youtubers who are being managed and monetized in a VC-y kind of way, this sort of thing is invariably going to happen. Cover has made investment to stream on Bilibili, which is China’s biggest weeb/youth video platform. The fact that the vtubers themselves are Japanese is irrelevant because by association Cover trying to monetize Coco or Haachama will lead to those problems. And frankly a mandatory 3-week break for the talents is the usual showbiz tactic, helping things to blow over. It’s not like those two won’t be attacked by streaming now, despite what their stans may say. It’s just typical de-escalation.

I think it does mean that the better long term strategy is to stream Chinese vtubers in China only, so you can let the more western-minded vtubers be themselves. Of course, there are internal business ramifications there. The token kotowing and having to make Coco/Haachama fans suffer for 3 weeks is a drop in the bucket in the overall scheme of things. Things will smooth over and move on while Cover management learn their lessons, hopefully.

To me, though, this is a bigger issue in two sense. So I’m going to pivot into this second discussion about economics (again).

In general, world economies broke out by country falls into three categories: 3rd world, developing, and first world. The majority of people in the world live in developing countries, like China and India. These general labels reflect more of an economic mode than actual quality of life that people associate with say, 3rd world countries. Yes, third world countries generally have major lack in infrastructure and developed industries. Their main economic output would be subsistence farming, mining and other resource extraction, and very low tier labor. Advanced economies, on the other hand, make their economic output on higher-end service industries (such as tourism) and labor adds value in a value-add chain (high tech industries, financial industries, etc). The former kind of countries can only make money by extraction: people mining ores are selling ores. The latter kind of countries make money because the people and businesses themselves add value: people writing code, giving your investment more dividends.

Developing economies are ones in between, where the mode of its economic output has shifted from the lowest tier into manufacturing and adding value, but they are cost-competitive because the labor force is cheap as the standards of living is low. As a country gets wealthier the cost of its labor will rise. Unless the value they add to their manufacturing also rises (for example, instead of sowing t-shirts they move to sowing shoes to building furniture to building computers), these developing economy will lose their competitive edge globally and be stuck doing that thing they got good at making. (By the way, Taiwan is a good example of this–a wealthy people that don’t make much money but because of the kind of products that make up Taiwan’s core exports, able to truck along much farther than much bigger, more resourceful countries.)

Where does the entertainment industry fit in here? Movies, music, art, books, and brands generally, are value add. A Louis-Vuitton bag may cost thousands of dollars, but it’s no different than a high-quality bootleg you can find in China in terms of looks and utility, at a fraction of the price. That’s because the brand itself adds value to the final product in the production chain.

A market like PRC brings its gigantic consumer base to the table. Indeed, advanced economies are not concerned about how much corn they can grow, or if they’re going to run of land to grow food or mine iron or whatever. They are concerned if there is demand for the things they can add value to. This is in other words the post-scarcity economy that advanced national economies are operating from. It’s not about how much you create, but how much you consume. For example it’s less important for Volkswagen to get that extra cent less per ton of steel they buy, and more important for them to increase demand for their cars–higher demand drives their topline price, reduce their inventory, increases margin, and improve on economy of scale.

And yeah, virtual youtubers only makes sense as an economic entity in this sense. Any reasonably outgoing person with knowing how things work could be a vtuber. The value-add here from Cover or other vtuber production teams add to the core product–a YouTuber/internet celebrity–is the promotional aspect, the business management, the branding management, tech support and creating art assets and what not, and also in talent management. These internet celebrities do things people already have been doing since the dawn of the vlog era, but this is the value add. And these things are only valuable if it generates corresponding, and additional, demand.

It is with demand that Mainland China heaves its similarly-trained netizens onto the world. In order to really escape that middle income trap that will invariably clip the wings of modern developing economies, these countries are always looking for ways to change gear in terms of what drives their economy. But this is still on the consumption side. For example, it is good economy for the USA to make a good film for the PRC, because mainstream/Hollywood films are these advance-economic, extremely value-added products that make billions of dollars for the USA each month (at least, pre-COVID). It’s like saying Avenger Endgame or Avatar made a billion bucks in the USA is a big deal, but it’s the billions of bucks these movies make overseas that is the bigger deal. And global blockbusters of this kind is almost monopolized by American filmmaking companies. China has been able to make some domestic ones, but they invariably all fail to register overseas. That’s where China is stuck on.

Maybe this partly explains why Tiktok is such a focal point this year, politically? Because the same thing is happening for social media platforms.

What I’m trying to say is, this is a bit of the same thing for virtual youtubers. At least for now.

Actually what I’m really trying to say is, the way China goes about their national policies about utilizing its massive human resource to shittalk their way into power is a zero-sum or negative sum economic strategy. Chinese companies are significantly sheltered by the country’s nationalistic economic agenda and it’s probably fair to argue many of them do not have what it takes to become global brands. This is also a national agenda for them to change, in which the likes of Huawei and Tencent are in the forefront. However, it’s not really clear how far this will go, and if the competitiveness of these companies and advantages are sustainable, innately driven, or external (such as above-average protective government policies). People in that country are working hard to shift their brands from being perceived as low-cost, low-quality to high quality. (Again, see the LV example. [Or maybe this is the difference between Nijisanji and Hololive? LOL]) That is really the mark of an advanced economy.

Then again, this is also why you can see having the fifties out in force is really the only leverage PRC has, because ultimately they are still in a position of consuming the products from external actors (Japanese companies in this case). Do they really have any say? Should they? I personally think the answers to those questions depends on ultimately the quality of good produced, and the arrangement of the bargain. That these vtuber VCs make good decisions that enable their talents and managers to make the best content is likely, the best outcome for the most people, long term.

PS. The video I linked has a super rough crash course on the political background on Taiwan and why they’re shunned by China. It doesn’t get into the nitty gritty at all, and doesn’t explain why there is an independence movement, etc., but it does highlight the economic trade agreement between Mainland and Taiwan, which is ultimately the one paper clip that connects the two sides of a single piece of paper. If you know a better video that gives the geopolitical crash course for Taiwan please let me know.

Nibbling on Granblue Fantasy (As a Story)

I think I should preface that this is more like a not-fully-earnest take (shitpost as they say on Twitter) on the topic: what is missing that makes Granblue Fantasy interesting to me, in Granblue Fantasy. I posit this tweet as the giant arrow in the sky pointing to the answer.

I think it requires that trigger warning or disclaimer here because I am picking on GBF for no reason. And this is probably better phrased as “CyGames FantasyVerse” or I don’t know whatever the term is for that.

As in, those stories are missing what makes a fantasy in my estimation of what fantasies are. It leans really heavily on adventure and characterization–because I think it’s fair to proclaim the majority of people enjoy swashbuckling adventures, may it take place on an island-hopping airship or elsewhere, featuring mights, magic, intrigue, and fantastical beasts. However, is this what it means to have a fantasy story?

Fantasy is a genre of speculative fiction set in a fictional universe, often inspired by real world myth and folklore.

According to Wikipedia, above, that is what a fantasy is. And I know everyone agrees with this, including Cygames, because we have stories like Manaria Friends (Mysteria Friends). That to me is a proper fantasy–where a set of relatively mundane human social circumstances are compounded into intrigue and interesting narratives because it isn’t just a boarding school for well-to-do teenage girls, but a magical school. In other words, it is the fictional universe (in other words, the setting) that defines fantasies. It is not the characters or the stories they tell that really make fantasies fantastical.

And FWIW the fictional universe in GBF is just a giant crutch. It doesn’t play a role as a character other than to peg different characters’ circumstances. If that’s all it is, you don’t need a fantasy to tell the same story. This is kind of how I feel about both seasons of the anime, and the Bahamut anime, with exceptions to some individual episodes. If the fantastical aspects of your story is just a contrivance, then your fantasy is just not that good? Hope I’m not saying anything really controversial here.

Again, here is a disclaimer that I am not versed in GBF story-wise, besides from the anime and random things I pick up on twitter. I really only play the game for the collaboration (and the free not-gambling).

Last Exile is the story that triggers this realization because, it is basically the same fantasy story, just slotted into the steampunk pigeonhole instead of the Tolkien-esque bin vis-à-vis JRPG lens. Maybe GBF has that story to tell inside all that garbage gacha game shell, but aside from cratered credit card bills, these tragedy-of-common businesses commit other sins in their wake.

PS. I wanted to write more for Kurocon but didn’t get to it before it was over, so read about the ANN announcement for us instead.

Case Study: ePlus complaint Open Letter

The a few week ago, some fans for the Love Live franchise decided to publish on twitter a letter complaining and asking for an oversea-friendly streaming option for the recent Nijigaku online live event. Being not really involved in any of this (although vaguely interested in the same event), I was wondering why there was any kind of perceived drama. Well, it seems clear to me why there was drama. See below.

A few thoughts, after reading that post and the twitter replies.

Good fans versus bad fans: In light of the ongoing racial protests in America, I think there is a parallel of dissonance between how illegally distributing and viewing content isn’t a “bad behavior” as compared to selectively applying laws or violence on perceived slights against African Americans but letting White Americans more leeway is also acceptable behavior.

It’s important for people who defend racist positions to justify their point of view, ie., they are still the good guys, despite engaging in an array of conceivably-to-obvious evil conduct or perpetrating questionable-to-toxic ideas in bad faith. The same can be said of all fans of a franchise, in that all fans are good fans, when considered individually. Of course if you ask fans from larger communities, few if any would say “all fans are good fans” is a true statement.

Good intention: I think the letter represent an attempt at customers trying to get some service. It is not unreasonable to ask the question that how will folks overseas, in these English-speaking regions typically serviced by Love Live official channels. A public letter, however, is not how it’s done with a consumer facing situation. If you were an adjacent stakeholder, maybe that would make more sense.

In the end what happened was the oversea-facing marketing folks were notified of this internet trend and an official statement went out to let people know an overseas solution was in the works. Last weekend it worked out (other than the technical difficulty that locked out the first session) and people got their seiyuu idols.

Groomed by attention-seeking platforms: The world doesn’t work like Facebook, Twitter, or Instagram. As old timer like Kelts would say, and I quote:

What sucks is that the discourse on social media is so coarse. When you go back and read exchanges between diehard anime fans on Usenet and old chatrooms and forums from the mid-2000s, they read like middlebrow literature compared to what you see on Twitter, Reddit, and Discord. So many social media posts are made just to get hits, not to communicate or share ideas, and the most provocative, cruel, or just plain daft stuff gets liked and retweeted a thousand times. 

An ex-friend of mine once told me he was going to market his book entirely on Twitter. I said, well then you’ll get a bunch of responses from people who don’t read a lot of books. But he said he just wanted to sell a lot of copies. He didn’t care about the quality of the people who read them or followed him.

But I guess that’s the state of most things in America right now, politics in particular. Mass appeal is all that matters.

I’ve got nothing to say to that. Well, maybe besides that it isn’t the acid rain’s fault that we can’t have good things. It’s a confluence of factors–people in their 20s and early 30s learned how to talk on the internet not via blogs but via Reddit, Twitter, Tumblr and the like. Maybe even 4chan is better? Forums basically all died and Reddit is really where it is now. But when you have this kind of issue, getting attention seems like an obvious helpline that it all went there. Ultimately that’s kind of just how it is today, but it comes across like that these kids do not care about the things are perceived. It’s always about mobilizing your online mob first and last. It’s part of the tragedy of the commons in which powers the economic engine of the attention economy. Maybe it’s popcorn for some, but it’s pollution in the most basic economic sense.

Satoshi Kon, 1963-2010

On the 10th anniversary of Kon’s passing, we need his work today more than ever. For now, there’s a teaser of a documentary about Kon being floating around done by a French film company.

Kon is easily my favorite dead filmmaker. Not that it really helps–but as others said better than me repeatedly, that his ability to craft a movie that blurs the boundary of reality and fantasy is unmatched, especially if we frame it from the bounds of anime filmmakers.

From the perspective of where I live, in an increasingly polarized society due to socio-economic and political reasons, more people are being challenged to tell fiction from facts. Fantasy is ever more the salacious escape from the troublesome world. Clearly, dead man makes no movies. What would it take to get a Kon-type movie capturing the the vibe of 2020? I want some work that appreciates media literacy in this space, it’s something I have sorely missed in the past 10 years…

Like, when the dialogue in this fandom space is buzzing about anime works like Kon’s films, it elevates my quality of life. Literally those things gave people a reason to talk about these complex masterpieces instead of, I don’t know, whatever that’s happening in anime today. Even if Paprika seems to be the only thing people love to talk about on the surface (at least, Perfect Blue is the one everyone seems to remember). I’ll take that over like, I don’t know, the Promares and the Fate/Go_straight_to_Tsukihime_never of the day. Okay, yes, it doesn’t mean other works can’t mutually exist just fine with what I want. But this is the world we live in: no new Kon movie until the foreseeable future? Maybe Shinkai can be the next Miyazaki but what we need, and had always needed, is the next Kon.

Economics of Lapis Re:Lights and Deca-Dence

I need to preface this with a plug of sorts. I blame this blog post on this Youtube channel, which recently I’ve been listening/watching because it occupies a weird mind space where while it regurgitates modern econ textbook content, it’s repackaged in a soundbyte form that is mostly the right spin, as long as you understand where it comes from. It also breaks down some current event topics, which is always helpful.

So there it was, me, watching Lapis Re:Lights on the weekends. Nevermind that the main character’s (center?) head piece has a vaguely biological diagram in the middle. Never mind her, even. Or the rest of the cast except maybe the few foreigners. It’s “just the facts, ma’am” when it comes to the characters that provide us clues to the setting. In Lapis Re:Lights, people perform “orchestras” to collect mana to power its society. Mana seems to be just some elusive notion that is generated by a crowd or a region of a city.

You can refer to other works out there that think about an economy where magic is a part of it. If our economy today is running on 100% clean, renewable energy, what would the economy be like? What if we can turn this energy into goods and products in a way that scales to flexible demand? Can this energy be easily stored and made available, any time and anywhere? Actually we have some ideas to answer these basic questions.

For one, it is a work of labor to do magic. A person can only cast so many spells, based on some notion of skill (I guess, the characters are at a school to study magic). It takes a person some time to cast a spell, and to deal with the result. It also seems like scale is limited (it isn’t the same effort to magically create 1 widget versus a million widgets). A lot of the spells in the show actually do not go into things that directly generate value. Putting on lights in the sky or being able to do fancy acrobatic moves or obtaining inhuman strength are all fine and well, but it’s hard to see how anyone would exchange those things for currency. Students in the show still participate in employment much like our real world.

Mass production is also an unknown in the world of Lapis Re:Lights. The visual depiction of the world seems to be a mid-industrial-revolution European setting. We see elaborate architecture, furniture and designs. Maybe the cobblestones makinig up the roads and sidewalks clue us in, but that could be a magic thing. But someone out there has to be making magic lanterns and other similar things at bulk, right? We see a city, and it seems to be not that small. In that Lapis Re:Lights is a world with craftsmen (Merrybery is a cute!), it might also be a world with distinct social classes, as implicit both by the structure of the students organizations inside the school, and that there are royalties and rich people, versus common folks.

If we put aside things like colonization that fueled the European powers during the industrial age, then it begs the question of how the basics needs of that society is met. Is there a large number of farmers in that world? If not, where do people get food from? How does such a country generate goods and services to trade for necessities? It does seem that the country the anime takes place have commercial relationships with other nations, such as the far east knockoffs countries that sent the 3 students that makes up Konohana wa Otome and the Asian princess in Supernova.

Of course, there are still a lot of outstanding questions about the fundamentals of the nations in the world, let alone the one the anime takes place in. Is Waleland modeled after a mature European economy like Holland or Norway that we know today? Or like Monaco, where rich people go there to live and tourism makes a big part of the economy, but doesn’t really generate wealth? Or is it more like Liechtenstein, where you have a huge tax haven-style banking and corporate finance system but also a high end manufacturing sector that makes expensive, low-volume, high-tech goods like medical equipment and manufacturing machinery? I mean I would buy their magic tents.

Definitely, if Waleland doesn’t need to import materials to run its energy economy, it can do well exploring expensive magic-infused goods, assuming the global market is mature enough. High-end manufacturing only works when there is enough demand for it, that there is a wealthy group of buyers who would be able to afford it. It could be organizations or individuals, but it’s not clear where the world sits in terms of that. But the vibe you get from this show is Waleland this is a country with a positive trade balance, where a major luxury of its people and a national resource is the magical power that fuels its infrastructure and give reasons for orchestras to exist.

On the flip side of this, in this summer season 2020, is Deca-dence. We know the creator of this series has said that the name is a wordplay on “decadence” and while thematically that is true, the setting is wild in a “reverse Wall-E” kind of way. In it, and spoilers ahead (as of ep7), there are two worlds in the story, one is the “robot” world which is inhibited by digital intelligence–from what we can tell, it is also a physical world even if the anime depicts it like cyberspace. Said digital intelligences can “jack in” to control other avatars in the Deca-dence world, which is another reality, also in the physical world, where these cyborgs and actual humans coexist. In the Deca-dence world, however, when people are killed, they are killed–unless you are a cyborg, in which you only lose your body and you get kicked out of the game (it’s kind of like Permadeath I guess)?

The economics of Deca-dence (the game?) is interesting, because clearly inside the system there is a real economy. I think this is no different than any other video game economy in which NPC (humans?) and players set the price based on supply and demand. There is a proper “sink” in which are the conflicts with Gadolls cost various resources, in terms of equipment needed to fight them, the human casualties, and other damage Gadolls inflict. Looting the Gadolls drive the economy in terms of supplying fuel, food, and other material. I don’t know, for example, where people inside Deca-dence get materials to create robotic parts (protagonist’s cybernetic arm, for instance), or even raw metal used to make those needle pipe things. It seems that there are repair kits people use to fix their homes, and armor plating used to repair the outer wall of the giant mobile rocket-arm-and-home-base. If a humvee gets blown up during the fight against the Gadolls, how do people replace it inside Deca-dence. These are important questions that don’t have clear answers.

That said it’s clear that Deca-dence, as far as a proverbial fish tank goes, is not self-sufficient. It’s clearly not a closed system since Gadolls are created outside of it and put into the game. It’s likely some manufacturing is not done by the facilities inside Deca-dence, although it does manufacture some stuff. I might have missed it, but it never implied all raw material that is needed to create stuff inside Deca-dence came from harvesting Gadolls. Although, as the setting goes, Deca-dence is actually on Earth, so there could still be resources that is harvested from the environment in general.

I mentioned that NPC and PCs set prices in the game, but this is partly true. It does have some kind of developer-set pricing for high end gear, which is really only accessible by external players (who are also called Gears), as it would mean they can purchase upgrades for their Deca-dence characters using currency outside Deca-dence. There is some reason to believe this is actually the case. Which leads us to think about what is actually interesting.

That is, the world outside Deca-dence, to be honest, is way more interesting, even if it is a much more slippery idea. The creation story that the audience is told in episode 2 paints a cyborg new-world in which humanity became nearly extinct, but only after we have uploaded ourselves into cyborgs and live in some kind of hybrid VR world. Deca-dence is really a zoo for humans, but also a “reality” game in which is basically a VR game for the cyborg denizens. So in narrative practice, it is the reverse SAO in which people in the VR is playing a game of reality.

While we were told a lot about the setting, I think much more isn’t really told to us and it’s up to us to find out. In as much the story bothered to tell us that there is an energy cycle in which Gadolls are the core transfer medium in which the cyborgs fuel Deca-dence, the Gadolls have to come from somewhere and there definitely needs be some kind of energy to power that new society of cyborgs. If anything, energy is even more important–it’s not like we can just farm and provide a way to survive anymore.

The idea behind market economics and creating sinks is very relevant to game design, however, so this is possibly the most natural take to our view of this kind of criticism of governing-by-theory, which tangentially is a blow on macroeconomics as well. I think it is kind of a dull blow though, even if it makes an apt analogy of thinking about the lives of main street folks affected by the high rollers on wall street, to use another analogy that gets to the point more succinctly.

To end this long rambling let’s just recap why this is interesting–settings are interesting in any work of fantasy, ultimately, because fantasies are fantasies are a reason. Underpinning any sufficiently robust depiction of any world is its economics. And you would at least think throwing key terms into the explanation of a core plot element would at least mean something.

In Deca-dence’s case, I think ultimately a post-scarcity, demand-based economy is its own criticism. But short of lecturing people on macroeconomics I don’t know what would really work as a compelling and entertaining story. Maybe this is why I watch those videos on Youtube.