The Smithsonian's entrepreneurial impulse to exploit new media for profit is a healthy one, at root. The Smithsonian is already a quasi-private entity, where most staff is on the public payroll, while most executives are paid with privately solicited donations. It could conceivably, like the U.S. Patent & Trademark Office and the federal student loan agency Sallie Mae, aspire to becoming a self-supporting entity within the government.
So of course, the institution is taking a lot of flack for its deal to produce on-demand, for-pay documentaries in conjunction with Showtime. Congress has even joined in, cutting the institution's funding while citing the high executive pay as an excuse. The deal is bad, but not for the reasons being stated in editorials. It is bad because of an anti-competitive clause that gives Showtime first-refusal over the 'right' to fund documentary projects seeking to use Smithsonian archival material. Far from privatizing the Smithsonian, this makes Showtime a de facto government agency. Forcing documentarians to seek funding from a single source in order to pursue a creative project based on national archival material is an awfully pink concept, and the kind of move that gives privatization a bad name.
Cross-posted on Samizdata.