About this Author
Dana Dana Blankenhorn has been a business journalist for over 25 years and has covered the online world professionally since 1985. He founded the "Interactive Age Daily" for CMP Media, and has written for the Chicago Tribune, Advertising Age, and dozens of other publications over the years.
About this Site
Moore’s Law defines the history of technology. It held that the number of circuits etched on a given piece of silicon could double every 18 months as far as its author, Intel co-founder Gordon Moore, could see. Moore’s Law has spawned constant revolutions since then, not just in computing but in communications, in science, in a host of areas. Moore’s Law applies to radios, and to optical fiber, but there are some areas where it doesn’t apply. In this blog we’ll take a daily look at new implications of Moore’s Law in real time, as it rolls forward to create our future.
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October 31, 2005

How the Bucky Man Transformed My Alma Mater

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Posted by Dana Blankenhorn

smalleytesttube.jpgDr. Richard Smalley passed away last week.

Few men have ever transformed an institution as profoundly as Dr. Smalley transformed my alma mater, Rice University in Houston.

It started before he got there. When I was an undergraduate I went to a little talk at Hamman Hall, then the largest theater on campus, by Buckminster Fuller. Bucky was amazing. I left with a buzz in my head the likes of which I have seldom experienced. So, I am certain, did many others.

As my senior year began Dr. Richard Smalley joined the Chemistry Department. He taught freshman Chem Lab. He seemed unremarkable. But over the next half-dozen years he gathered together a strong team, from a variety of disciplines, and in the mid-1980s his team found the molecule that would make his reputation, a 60-atom form of carbon, shaped just like a soccer ball, which everyone immediately dubbed the BuckyBall, after Fuller. Its formal name was Buckmisterfullerene.

It was what Smalley did after receiving his 1996 Nobel Prize, alongside Dr. Robert Curl (my wife's chem lab prof) and Dr. Harry Kroto of England, which made him unique.
Instead of taking the money and running, either into retirement, or toward fame, or into a bigger, better-funded school, he remained at the center of Rice. His Center for Nanotechnology Science and Technology has proven an incredibly open, alive scientific environment, best-known to outsiders for its wealth of great women scientists, like Dr. Naomi Halas. Far more important, however, is the breadth of disciplines Smalley brought together.

Look at this roster. Yes there are biochemical engineers and chemical engineers, there are chemists and physicists. But there are also economists, a philosopher, an anthropologist, even a religious studies professor. There aren't honorary positions. This is an integrated team. By bringing multiple disciplines together, with various ways of looking at scientific theory and results, the chances of a breakthrough are greatly enhanced.

That approach is now starting to bear real fruit.

Some of that fruit is finny, like the world's smallest car. Some of it is dead serious, like gold "nano bullets" that might have saved Dr. Smalley's own life, had the discovery come a decade earlier.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Futurism | Moore's Lore | Science | personal

The Collectors

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Posted by Dana Blankenhorn

shrage.jpgA friend tells me that Eric Schmidt isn't really in charge of Google, that it's still Sergey and Larry's show.

I don't know. That might be. If it is they have tipped their hand as to their corporate culture.

They're collectors. They collect great minds. Whether they listen to these minds is unclear. But they love to collect them. Get the whole set, like other kids collect trading stamps.

The latest "great mind" to join the collection is Elliot Schrage (above). He follows Vinton Cerf, "the father of the Internet" (so called) and Dr. Schmidt himself, the "father of Java" (also so-called).
The collectors like those kinds of titles. They like credentials. They're Stanford guys. They want proof of quality. Credentials are proof of quality.

Schrage is considered a "guru" on "sustainable sourcing." He's a lawyer, not just a PR guy, although the title he takes includes PR. He's a Fellow of the Council on Foreign Relations.

He's a Big Head.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Business Models | Business Strategy | Internet

The Return of AT&T

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Posted by Dana Blankenhorn

Frankenstein.gifHiow is this for a Halloween story?

Like Frankenstein's monster, AT&T is coming back from the dead.

The genesis of this stupidity is probably the old North Carolina National Bank. It acquired dozens of banks, large and small, and became NationsBank. That was a new, powerful brand. Then it acquired the Bank of America, based in San Francisco. After the deal was done it took that name. Now, in downtown Charlotte, there are homages to the old BofA on the cornices of its downtown office campus, along with some of its other kills. The bank thinks it's a nod to history, but I think it's more like the old hunter who puts deer heads on his wall.

In this case, it's SBC chairman Ed Whitacre who has the big ambition. He thinks that, by using the AT&T name, he can inherit the Bell System and, eventually, recreate it. Put back together what was torn asunder, only this time with no regulation, no controls, all powerful.

And in control of your Internet.

In his first move with the power of AT&T, Whitacre wants to start charging sites rent in order to reach his customers. Forget network neutrality. Forget about the nature of the Internet, which is that users route around attempts at control. If you're using SBC (excuse me, AT&T) DSL, Ed Whitacre will decide what sites you can see, what services you can use, what protocols you can support. My guess is he won't start by demanding rents from Google. He may go after smaller sites, like Corante, first, in order to set the precedent. But this is his promise.

This is the way Bellheads think, and it's good to get it out in the open. It's all about control of the customer, total control. Whitacre seems under the impression that today's political status quo will survive forever, that he will be allowed to control his customers as he wants.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Business Strategy | Internet | Investment | Politics | Telecommunications | e-commerce

October 30, 2005

The $50 Cellphone

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Posted by Dana Blankenhorn

free%20cell%20phone.jpgThe $50 phone is coming.

I’m not talking about a phone that costs $50 to make (that retails for $250). I’m talking a phone that costs $50 or less to make at retali. Americans already get free phones, subsidized by one-year or two-year service contracts, they they may not get the implications here.

Readers of this blog know about the big growth in service to Latin America, Asia and Africa. What you may not know is that this is mainly a middle-class phenomenon, even there. Poor people, poor by the standards of those countries, either use middlemen for their limited phone service, or they do without.

  • With a $50 phone, service providers may be able to afford cell towers across the countryside, even in the poorest villages. Families in those villages may be able to afford their own phones. People from those villages may be able to have those phones, and access that service, when they are out in their fields, or in open country. Universal service may really be at hand.

  • Another implication of the sub-$50 phone is that a new mass market of voice-only customers will develop. For now data service relies on more expensive models. Eventually Moore’s Law will allow today’s data services to trickle down onto those $50 handsets, but that will take time. And at that point, the selling point for things like text messaging will be its lower cost. (In contrast, today’s text messaging is seen as an extra-cost add-on to your service.)

  • A third implication of the sub-$50 phone will be its increased use by criminals. A disposable phone means more disposable accounts, more pre-paid services that allow anonymity. It means more phones that can be used as triggers for car bombs by terrorists, or that can’t be traced to kidnappers and bank robbers.


...continue reading.

Comments (2) + TrackBacks (0) | Category: Business Models | Consumer Electronics | Digital Divide | Economics | Semiconductors | Telecommunications | cellular

Final Exam for CAN-SPAM

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Posted by Dana Blankenhorn

alt="spam.gif"Since its passage the CAN-SPAM act has done more to enable spam than any other act by anyone. It legalized specific forms of spam, it overturned stiffer state laws, and it has gone unenforced.

The primary enforcement of this "law" has come from private parties. Microsoft, which urged the act's passage, has been the most aggressive. And they're making one more attempt to make it work, suing 13 spam gangs that use malware to turn ordinary PCs into "spam zombies."

The lawsuits should make clear a dirty little secret of the spam wars. It's homegrown. Much of the spam supposedly coming from Korea, Russia or China is actually being bounced off servers there to mask its origins.

The likelihood of this being effective in stopping spam is nil. I also disagree on the need for new laws. Instead of going after spammers, go after the people who pay for spam to be sent.

A lot of spam represents fraudulent offers and those who make those offers should be prosecuted. Shaming corporations into policing their distribution channels and re-sellers would get rid of another hunk. Illegal offes should be prosecuted under fraud statutes. Attorney General Gonzalez might enjoy prosecuting porn spammers under obscenity statutes.

Shaming can work. There is little political spam for that very reason. Candidates and causes who spam lose support. When this happens to corporations, they will take the appropriate action.

...continue reading.

Comments (4) + TrackBacks (0) | Category: Internet | law | spam

Should I Kill My Phone Line?

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Posted by Dana Blankenhorn

bellsouth%20logo.gifOm Malik has an article that goes inside the Bells’ loss of DSL market share (and then phone lines).

In order to serve customers, phone companies must install expensive DSLAM equipment in each switch, and when that’s maxed-out they must install more. Cable operators, by contrast, made all their capital investment up-front. The “burden” of a higher market share is borne by the customers (who must share a limited resource), not the company.

Last week, as I noted here, I switched from DSL to cable modem for my broadband service. This was not the fault of BellSouth. It wasn’t really the fault of Earthlink, my DSL provider. A lightning strike hit my phone system, and the only way to learn that it also killed my PC’s Ethernet circuit was to come in and test it. The cable modem guy did that.

The question occurs, then, what about the rest of my phone service? I’m paying $60 for a single phone line, one I’ve used for nearly a quarter century, one I’m known for. That’s a lot to pay for a brand that, in theory, I can switch to a cell phone.

A decade ago, when I was with Interactive Age my employer, CMP Media, made me install an extra phone line they would be billed on. BellSouth actually had to replace the box outside my house with a new unit that could handle as many as six lines. Now one line lives where six were supposed to…and it’s hanging by a thread.

Is it time for me to kill my personal Bell?

...continue reading.

Comments (4) + TrackBacks (0) | Category: Business Strategy | Consumer Electronics | Economics | Internet | Telecommunications | personal

October 28, 2005

Replacing Edison

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Posted by Dana Blankenhorn

Edison.jpgThomas Edison was America's greatest inventor. He was wonderfully prolific, a symbol of the 19th century who stayed active well into the 20th. But many of his inventions have been replaced:

  • His ideas on the use of DC current were replaced by AC by the 1890s.
  • His improved ticker tape was replaced by computer networking.
  • His phonograph was replaced by the CD.

Now perhaps his greatest invention, the light bulb, is about to be replaced.

LEDs are about to replace light bulbs. Vanderbilt graduate student Michael Bowers (go Commodores) was just trying to make really tiny LEDs, quantum dots made on a nanoscale. But he found after fabricating them that they were far more effective light sources than a regular light bulb.

Here's how a Vanderbilt University publication explained it:

Although they are considerably more expensive than ordinary lights, they are capable of producing about twice as much light per watt as incandescent bulbs; they last up to 50,000 hours or 50 times as long as a 60-watt bulb; and, they are very tough and hard to break. Because they are made in a fashion similar to computer chips, the cost of LEDs has been dropping steadily. The Department of Energy has estimated that LED lighting could reduce U.S. energy consumption for lighting by 29 percent by 2025, saving the nation’s households about $125 million in the process.

Cool, huh?

Of course, one great Edison invention has yet to be bested.

...continue reading.

Comments (1) + TrackBacks (0) | Category: History | Moore's Lore | Science | Semiconductors

The New Credibility

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Posted by Dana Blankenhorn

forbes_logo.jpgWal-Mart is under fire for its lack of benefits. It's running ads where an employee calls the company her "support system" after a liver transplant. Oil companies are under fire for price-gouging. They run ads claiming to be green. Mutual fund operators who've pled guilty to stealing from customers run ads saying they've earned our trust.

This is par for the course in corporate America. Advertising is used to make people forget. As the press moves on to other stories, it often works.

But it doesn't work in the blogosphere. There is no business model corporations can use to induce forgetfulness among bloggers who oppose corporate actions.

That's why Forbes has placed, behind its registration firewall, a front-page feature on "dealing with blogs" through lawsuits and intimidation. There have long been powerful weapons employed against whistle-blowers and individual muckrakers. Forbes suggests these be deployed against individual bloggers.

But there is a problem with that, the same problem that befits the copyright industries. Copying.

...continue reading.

Comments (0) + TrackBacks (0) | Category: Business Strategy | Copyright | Internet | Journalism | blogging | ethics | marketing

October 27, 2005

Saved by the Cable Guy

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Posted by Dana Blankenhorn

the%20cable%20guy.jpgI was ready to write a slam against Earthlink this morning. Twice they have lost my order for a new DSL modem. On the phone yesterday I grew quite testy.

But this morning the UPS guy showed up at my door, with a box from Earthlink. A DSL modem. Hooray!

Well, not hooray. First I had trouble getting it to go on. Turns out one of the plugs on my UPS was fried in Friday's lightning strike. Then I couldn't get the DSL light to go on, indicating the modem was working. After several hours on the phone (and several times on my knees) I was sent to a local Radio Shack for a DSL filter.

I had just installed the filter, and the green DSL light was still not there, when a miracle occurred.

It was a cable guy.

In my anger on the phone the previous day, I followed through on my threat to call the cable company. I told them I was a long-time cable subscriber (true) and asked how long it would take to get modem service. Three to five days, I was told. So I forgot about it.

Yet here on my doorstep was a cable guy, in a white truck, promising to have me on the Internet within minutes. Oh, frabjous day, calloo callay! I chortled as he worked.

But the install took longer than expected, and the explanation showed why I was wrong to curse Earthlink.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Consumer Electronics | Internet | Telecommunications | personal

October 25, 2005

Intel Losing Power

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Posted by Dana Blankenhorn

otellini.jpgThe headline is a pun.

Intel's new chip road map, announced today, implements a commitment to lower-power processors the company announced earlier.

But in some ways the headline is not a pun. Intel really is losing some of its power, the power to define markets, the power to control them. Much of this power is being lost to AMD.

But Intel is willing to lose this power in order to rationalize its chip line and prepare for the real chip end game, which begins once a Chinese chip company decides to abandon the Intel road map and go out on its own.

Seen from that angle, everything Intel is doing looks prudent. Pruning the line, emphasizing lower-power in higher-speed processors, it's all very reasonable based on Moore's Second Law, the fact that, as designs become more complex, they become exponentially more difficult to implement.

...continue reading.

Comments (5) + TrackBacks (0) | Category: Business Strategy | Consulting | Moore's Lore | Semiconductors

Rich and Poor

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Posted by Dana Blankenhorn

david_spade_capital_one.jpgOnce there were three classes in America. Now there are two.

You are rich or you are poor.

How do we tell the difference? It's quite easy:

  • In the 19th century the rich were fat. Prosperity meant you had enough to eat.
  • In the 20th century the rich were thin. Prosperity meant you could control what you ate.
  • In the 21st century the rich can age.

It's access to health care that now divides the rich from the poor. If you've got a good health care plan, or can even afford to go beyond it for cash, you're rich.

If you can't, you're poor. Are you in an HMO that says "no" like one of David Spade' s Capital One ads? You're poor. Are you attracted by these new "pretend health care plans" that say if you're young and healthy you've got "found money" and you don't have to pay for others' problems? You're poor. Work for Wal-Mart and you're not a manager? Don't let their adoption of their own "pretend" plan kid you, nor their talk of how you're an "associate," you're poor.

The divide -- the key to the divide -- lies in preventive care. Specifically the drugs you need to stay out of the hospital.

I'm lucky. I'm rich. Thanks to my wife, and her health care plan, I can get Lipitor for my cholesterol, Diovan for my blood pressure. My son can control his anger, my daughter can control her acne. We even have eyeglasses and regular dental check-ups.

I know, wow. If she left me, or were fired tomorrow, I'd be on the other side of the divide within moments. My prosperity rests on a knife edge. We call this middle class.

...continue reading.

Comments (2) + TrackBacks (0) | Category: Economics | Journalism | Politics | Science | medicine | personal

Comeback of the Year: Chris Anderson Leads Wired Back

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Posted by Dana Blankenhorn

wired=anderson.jpgThe naming of Chris Anderson as AdAge's "Editor of the Year" caps one of the biggest comeback stories in publishing history.

While Wired wasn't tjhe biggest boom-and-bust magazine story of the 1990s (The Industry Standard holds that honor) its sale to corporate America was seen as an ending. I (and many others) wrote often that Wired is Tired, using a cliche from the magazine's own pages. The magazine's horizons shifted inward, from revolution against the corporate system to service on its behalf.

Under Conde Nast, Anderson has turned that around. He has made Wired relevant again. He did this in part by thinking big thoughts himself, as in his own Weblog-book The Long Tail. But this is a team event. Anderson built a great team, which managed to produce many articles that turned heads.

I have great respect for this award, and new respect for Anderson, because I once wrote for AdAge and I know the process that goes into making this kind of announcement. AdAge's staff is putting its own prestige on the line by honoring Anderson. It does not do this lightly.

Congratulations, Chris. You obviously earned it. You're obviously Clued-in. Keep up the good work. And best of all, you're a Truly Handsome Man.

Comments (0) + TrackBacks (0) | Category: Business Strategy | Internet | Journalism | marketing

October 24, 2005

American Diaspora 34

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Posted by Dana Blankenhorn

NOTE: This is part of a continuing online novel. Here is the Table of Contents.

The America Diaspora is a sequel to The Chinese Century.

Scale up, scale down.

...continue reading.

Comments (0) + TrackBacks (0) | Category: fiction

Off Line

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Posted by Dana Blankenhorn

Panera Bread.jpgRegular readers of this space may wonder where I've gone.

There's a story there.

It starts Friday evening, when a sudden lightning strike knocked me offline. Turned out that my phone service was knocked out -- not the cable, not the electrical, just the phone.

I called for help from my cell phone, and (fortunately) the phone company was nice enough to make an appointment with a serviceman for this morning, Monday.

So what happened Monday you ask.

...continue reading.

Comments (2) + TrackBacks (0) | Category: 802.11 | Futurism | Internet | personal | spam

Table of Contents: American Diaspora

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Posted by Dana Blankenhorn

NOTE: This Table of Contents will be continually updated as new chapters are placed online.

...continue reading.

Comments (1) + TrackBacks (0) | Category: fiction

October 21, 2005

This Week's Clue: The Entrepreneurial Mind Set

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Posted by Dana Blankenhorn

In my spare time I'm helping a start-up.

This has given my e-commerce newsletter, A-Clue.Com a realism it never had before. (Subscribe here.)

Now, as in this week's issue, it's the thinking of a real entrepreneur, inside the process. Strange days, indeed.


Young people are naturally entrepreneurial.

I have two in my house. One wants to be a lawyer. The other isn't sure what she wants to be. But both work very hard, they are on the lookout for opportunity, and when something comes along they grab it.

I wish one of them knew PHP.

An aging society naturally has fewer people who will grab for a chance, who will move, who are willing to learn new things in order to make something happen. As the pool dwindles, many young people start getting old habits. They grow lethargic. They want to be shown. They want a guarantee. We see it in Japan, we see it in Europe, we see it in the U.S.

...continue reading.

Comments (5) + TrackBacks (0) | Category: Business Strategy | Economics | Futurism | Internet | Investment | personal


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Posted by Dana Blankenhorn

craig newmark.jpgWhen Craig Newmark sold 25% of his Craigslist to eBay last year, there was some skepticism. "This is a mistake. eBay bad and robotic, Craig's List human and good. And now on the way to selling out."

Well, that writer need not have worried. Craigslist can be robotic, too.

Before, and since, eBay bought an early executive's stake in his company, Newmark has been busy trying to control what the Internet says you can't control -- links.

Techdirt has a summary of the latest. Just as eBay blocked out people who tried to link its auctions with those of other companies, Craigslist has forbidden aggregation, even searches across multiple Craigslist sites.

Had Craigslist not sold its stake to eBay it might be difficult for it to get away with this. But lawyers are wonderfully useful creatures, able to stop even obviously-legal things, like linking into the site, by firing papers and money over the bow.

The queston isn't, is this right. (It's not.) The question is, is this helpful to Craigslist?

The simple fact is that, in the short term, it's not, but in the long term, it may be.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Business Models | Business Strategy | Copyright | Internet | e-commerce | law

Walter Scott's Internet Power Play

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Posted by Dana Blankenhorn

walter scott jr.jpg A childhood friend of Warren Buffett is engaged in a power play that could raise your Internet bills.

NOTE: I have been informed by commenters, and confirmed, that Buffett's Berkshire Hathaway sold its Level 3 stake in November 2003. Level 3 founder Walter Scott, however, is a childhood friend of Buffett's, and a member of the Berkshire-Hathaway board. The correct headline should thus be "Walter Scott's Internet Power Play." I deeply regret the error.

He's doing it through Level 3. Buffett owns bought a big, quiet stake in Level 3, through secured notes bought by Berkshire- I Hathaway in 2002. Also, Level 3 chairman Walter Scott is on the Berkshire-Hathaway board.

Level 3, one of the largest Internet backbone operators not owned by a Bell company, is losing money. It's trying to change this by getting tough on peering, the linking of its network to other ISPs.

Specifically it cut connectons with Cogent Communications, a smaller backbone provider, early this month, and plans to do it again next month. The effect is to render 15% of the Internet invisible to Cogent customers, and vice versa.

...continue reading.

Comments (6) + TrackBacks (0) | Category: Business Strategy | Economics | Internet | Telecommunications

Economic Lesson of Google Print

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Posted by Dana Blankenhorn

little red hen.jpgI have been reluctant to dive into the Google Print controversy because all the rhetoric is phony.

The rhetoric is about principles, fair use vs. copyright.

The reality is this is about money, about monetizing something that had no previous value and the obligation that places on the person doing the monetizing.

The plain fact is that everything Google has done, and everything Yahoo did before it, is based on monetizing fair use. The concept of fair use arose based on the idea it had no economic meaning, that it represented a necessary intermediate step on the way to meaning (and money).

But now we find, 10 years after the Web was spun, that fair use has enormous economic value. Through the magic of databasing, finding is now more valuable than having.

What then is the obligation of those who extracted this value to the holders of the data providing the raw material? The legal question has been answered, there is none. If publishers can stop Google from offering books online without payment, they can stop Google from linking to books without payment, because Google is only going to offer extracts that represent fair use free. It's the physical equivalent of the "deep linking" proposition we dealt with in the 1990s. If a book isn't read because it can't be located it makes no sound.

The moral question is something different entirely. If Google extracts a profit from Google Print, I think it does have a moral obligation to spend some of that money on activities that benefit writers and other content creators.

...continue reading.

Comments (2) + TrackBacks (1) | Category: Copyright | Internet | e-commerce | ethics | law | online advertising

October 19, 2005

Is the Blogosphere Really Better?

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Posted by Dana Blankenhorn

The question is serious.

I have seen a ton of blogs lately which have all the pretentiousness, all the assumed (rather than earned) authority, and all the tone-deafness to reality of anything in the so-called Main Stream Media they're criticizing.

We live in a time of immense selfishness, and hollow ethics. This is true in both parties. This is also true in all media -- including the blogosphere.

Just because reporting is "open source" does not mean you believe all sources. It means you take responsibility, as part of the conversation.

An example follows.

...continue reading.

Comments (3) + TrackBacks (0) | Category: Internet | Journalism | Politics | blogging | ethics | personal

October 18, 2005

The Indian Invasion of America

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Posted by Dana Blankenhorn

geronimo.jpgNOTE: The following is meant for the coming launch of a local start-up. (I'll tell you when.) So it's a preliminary draft. Your thoughts and brickbats are all appreciated.

Next time some Mexican is blowing leaves around your house, look him in the eye. Look closely at his face, his nose, his lips, his hair, his skin color.

...continue reading.

Comments (3) + TrackBacks (0) | Category: Politics

The Speed of Deciding

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Posted by Dana Blankenhorn

My friends at ZDNet have another one of what I call "Business Week" stories about how big companies are fated to inherit the Earth.

This time the subject is Web 2.0. Jeff Clavier says that small innovators, like Jason Calacanis, are right to "flip" their companies now, because they're about to be crushed by GYM (Google, Yahoo, Microsoft).

city slickers.jpg
I have seen this story repeated endlessly the last decades, and looking at that list of "big powers" should put the lie to it. Microsoft is 30 years old, Yahoo 10, Google barely 5. Yet they're fated to succeed and smaller companies should get out of the way?

Having written this before, I don't just want to bitch about it again. I want to explain why I'm right.

It's true big companies can move quickly, act quickly, implement quickly, and throw lots of money at problems like Web 2.0 (which, after all, simply requires adapting database techniques to what folks want from the Web). The speed of action, and its scale, do not determine success or failure.

What determines it is often the speed of deciding.

Once any company achieves success, and becomes filled with successful people, the decision-making process naturally slows down. It has to. People must compete for resources, and a single management's attention, in order to get their projects priority.

Good ideas don't reach market quickly in this environment.

...continue reading.

Comments (0) + TrackBacks (0) | Category: Business Models | Business Strategy | Consumer Electronics | Economics

October 17, 2005

Are These WiFi Concessions Necessary?

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Posted by Dana Blankenhorn

ben_daddy_2005_08_square.jpgDeals like the Philadelphia tie-in with Earthlink, and San Francisco's pending WiFi concession, leave me asking a tough question.

Are these deals really necessary?

My friend Glenn Fleishman points out that a city concession dramatically cuts the cost of a WiFi cloud. The "winning" company has the right to use city streets, utility poles, and city owned land. They have a big leg-up in the market. (That's Glenn, left, with his son Ben, now 14 months according to his blog. My own son John is now 14 YEARS old, and I was feeling nostalgic.)

But are these benefits truly necessary?

Would the lack of a concession double a company's costs? Triple them? I don't know. But I believe, given the recent advances in Wi-Max technology, they're not determinative.

Should Earthlink prove "successful" in Philadelphia, in other words, there is nothing to prvent Verizon from creating its own, competing cloud. There is nothing to prevent a competitive fiber company, such as Level 3, with installing a collection of WiMax base stations in any city where it does business and offering WiFi backhaul to whoever wants it.

...continue reading.

Comments (1) + TrackBacks (0) | Category: 802.11 | Always On | Business Models | Moore's Lore | Telecommunications

Microsoft Plays Ogre

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Posted by Dana Blankenhorn

Let's set the wayback to the year 1973, shall we?

steve jackson.jpgI was 18, a kid really. And I had arrived at this strange institution called Rice University. I played in the band, I was interested in journalism, I was full of myself and insufferable.

My first editor at the newspaper, The Rice Thresher, was a short, hyperactive genius named Steve Jackson. (The picture is 30 years old, but that's how I remember him.)

Steve had a habit of pacing back-and-forth in the small office we used back then, and firing Xacto knives unexpectedly at the door. He missed me several times, for which I am eternally grateful.

After graduation, Steve came within a course or so of being minted as a lawyer by the University of Texas Law School, before deciding that the passion he'd had at Rice should be where he made his living. (This lesson helped validate my own career choice of journalism.)

Steve's passion, as you may have guessed by now, was gaming. Back in the 1970s games were designed with tiny slips of cardboard, punched out of larger sheets. Steve's innovation, which came out in 1977, was a game that cut production costs nearly in half. It was called Ogre and one of the two players had just one piece.

If Steve could find one of those old game boxes and ship one to Bill Gates right now, I'm certain Gigadollar Bill would get the reference. Because right now, that's the game Gates is playing in real life. And he's the Ogre.

For proof, check out this long David Berlind feature on Massachusetts, and its decision to exclude Microsoft's XML file formats from future state purchasing contracts.

This was the meat of the story for me:

"The Massachusetts Enterprise Technical Reference Model (MA ETRM) proceedings are where some of Microsoft's biggest competitors (IBM, Sun, HP, Novell, and Adobe) gathered to make sure that Microsoft was checkmated with a devastating weapon that they themselves have been unable unleash on the American chessboard: Democracy. "

...continue reading.

Comments (1) + TrackBacks (0) | Category: Business Strategy | History | Software | personal

October 14, 2005

Yahoo's Blogging Dilemma

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Posted by Dana Blankenhorn

yahoo news.gifYahoo has begun offering some blogging results on its News search page. This, they think, puts them a step ahead of Google, which isolates blog results caught in the RSS net to a separate blogsearch page. (Both sites are in beta.)

Yahoo thinks this puts them ahead of Google in an important functionality. I think the folks at Yahoo would actually use a word like functionality.

But it does them little good (or this is barely alpha software):

  • Most blogs aren't indexed. This blog isn't indexed in Yahoo News.
  • No more than the first page of results are really available in any search that comes up with blogs. I got timed-out repeatedly trying to get past the first page of results today.
  • Blog results are segregated to the right of the news results. I think this will continue.

...continue reading.

Comments (3) + TrackBacks (0) | Category: Business Strategy | Copyright | Internet | Journalism | online advertising

This Week's Clue: The Open Source Business Model

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Posted by Dana Blankenhorn

We're back on task at A-Clue.Com , discussing our original charter -- electronic commerce.

Of course, if you had (subscribed already these thoughts would be in your inbox right now.

Still, better a few hours late than never, right?

bingobangosoftlogo.jpgThe recent agreement between Google and Sun highlighted a fact that has struck the tech industry in the gut, the effectiveness of the open source business model.

Marc Andreesssen, Bingo Bango Software in Atlanta, and even I (watch this space next week) are all working along the same path. Ad sales and e-commerce, when properly scaled, can pay for a lot of development. Those development costs can be spread so thinly that people can use powerful tools for literally nothing.

There are strict limits to this, I believe. A lot of entrepreneurs, and venture capitalists, look at the success of Google AdSense, they read about big companies ramping up their online ad spending, and they figure the same stuff they've been doing before will now start making big bucks.

Not really.

There are some key variables I believe will make the difference between success and failure in this space. One of the most important is the value you can derive from each page view.

Raising that value does not mean throwing ever-more-intrusive ads in front of people, or demanding personally identifiable information from each reader you then will share with advertisers.

What it means is making the offers on each page so relevant to the reader's interests that they will proceed down a sales funnel. How far will they go? That's where I part company with the "experts" in terms of strategy.

I'm proposing we think of three key elements in raising the per-page value of content::

...continue reading.

Comments (0) + TrackBacks (0) | Category: Business Models | Business Strategy | Consulting | Economics | Futurism | Investment | Linux | e-commerce | marketing | online advertising

American Diaspora 33

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Posted by Dana Blankenhorn

NOTE: This is part of a continuing online novel. Here is the Table of Contents.

The America Diaspora is a sequel to The Chinese Century.

“What do you mean, he’s a con artist?”

...continue reading.

Comments (2) + TrackBacks (0) | Category: fiction

October 13, 2005

Dana's Answer to Jakob's Quest

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Posted by Dana Blankenhorn

voice interface module.jpgOne thing which unites the previous two stories here is that they are both about computer interfaces. (What is this? You'll learn after you click below.)

The iPod is a computer interface, as much as Apple might protest this. The addition of a screen completes the transition from radio to TV, and from storage device to computing device.

Microsoft Office is, if nothing else, a basic user interface.

The Web is a user interface. So is your e-mail system, whether POP3 or Web-based. The cellphone is a UI.

The point is there is more going on in this space than there has been since I first got into this business, over 20 years ago.

Jakob's more right than he knows. The user interface we've used for a long time now is broken. As I've said here many times, a computer is not a TV set, a tape recorder, and a typewriter. The computer is what is in the middle.

...continue reading.

Comments (4) + TrackBacks (0) | Category: Consumer Electronics | Moore's Lore | computer interfaces

WYGIWYS -- What You Get Is What You See

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Posted by Dana Blankenhorn

jakob_nielsen.jpgThe Macintosh interface has been around, in one way or another, for 30 years. It has been the dominant computing interface for 15 years.

Jakob Nielsen (left), the King of Internet Usability (my title for him), says it is time for this to change.

The first attempt at that, he adds, will be in the next version of (wait for it) Microsoft Office.

The new interface displays galleries of possible end-states, each of which combine many formatting operations. From this gallery, you select the complete look of your target -- say an org chart or an entire document -- and watch it change shape as you mouse over the alternatives in the gallery. The interaction paradigm has been reversed; it's now What You Get Is What You See, or WYGIWYS.

I don't know how far this will get. We already have elementary versions of this interface in blogs. Blogs are based on templates, which specify typefaces, page design, and other elements before the writer starts to work. Here at Corante, these specifications are made centrally, and all Corante blogs look similar. That's also the way it works with such community network services as Drupal. Drupal calls such designs "themes," and the theme you choose for your community is the design every user gets -- reader, writer or administrator.

...continue reading.

Comments (8) + TrackBacks (0) | Category: Business Strategy | Consulting | Consumer Electronics | Internet | Moore's Lore | Software | blogging | computer interfaces

What's Wrong with the new iPod?

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Posted by Dana Blankenhorn

ipod video.jpgNothing, per se.

Technically, it's fine. Strategically, it works in the Great Game against Microsoft.

But it's not something I want. It breaks the first law of the original design.

Quite simply it's an attention hog.

The older iPod, with its clickwheel design, required you to look at it only on occasion, when you wished to change the order of your songs, or find a new one.

The new one, with its insistent color screen, demands your full attention while the device is playing.

This is not a problem with Apple. It's in the nature of video. It requires full attention.

...continue reading.

Comments (5) + TrackBacks (0) | Category: Business Strategy | Consumer Electronics | Copyright | Economics | Futurism | Moore's Lore | computer interfaces | marketing

October 12, 2005

Corante is Not Second Class Journalism

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Posted by Dana Blankenhorn

richard lugar.jpgSenator Richard Lugar (right, owner of a killer lemon flip cake recipe) is lugging around Washington something he calls the Free Flow of Information Act of 2005.

A better name might be the First Amendment Licensing Act of 2005.

Under the proposal, "journalists" would get source protection, but some would be more equal than others. Those who work for institutions (a dwindling proportion of the whole) would get the right to protect their sources. The rest -- independents, bloggers, etc. -- would get no protection.

In other words, the First Amendment protections of corporate journalism would be expanded, and the rest of us -- the pamphleteers, the true heirs of Tom Paine -- would be told to pound sand.

Given the abuse of current sheilds perpetrated by The New York Times in recent years, and by others who have allowed anonymous sources to hide behind the press' rights while engaged in mere bureaucratic name-calling, I frankly don't think this law is necessary.

...continue reading.

Comments (2) + TrackBacks (0) | Category: Journalism

October 07, 2005

Cramer Gets Prechterized

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Posted by Dana Blankenhorn

mad_money.jpgNever buy a TV guy's stock picks. They've already gone up by the time you hear about them, and if you do your own due diligence on those picks after you hear of them you have missed the move completely.

Right now James Cramer is the most popular TV stock picker out there. And last week, in New York, he got Prechterized. By that, I mean he sounded a warning as any ever uttered by Robert Prechter, the Elliott Wave theorist I wrote about earlier this week.

Cramer's bearish analysis isn't based on waves, like Robert Prechter's bearish analysis. It's based on the performance of the Bush Administration. (Cramer also seems to admit in the column that he's a Democrat, so if you're not, you now have your excuse to ignore his advice, analysis, TV show, columns, and Web site.)

Cramer is scared, which should scare you. In his column he recommends a gold stock called GoldCorp, a minerals trader called Rio Tinto, a French oil outfit called Total, a South African energy technology outfit called Sasol, and the Fording Canadian Gold Trust.

I don't know about any of these outfits, but there's a trend here. They're not from the U.S. They deal in hard assets. They're hedges against our inability to sell new debt and the inflation that would result from that.

...continue reading.

Comments (2) + TrackBacks (0) | Category: Business Strategy | Economics | Investment

This Week's Clue: Second Acts

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Posted by Dana Blankenhorn

We all grow older, even tech executives. And this week, my free weekly newsletter, A-Clue.Com offers some thoughts on that. (Subscribe here.)

Think of it as another product of...the aging process (you should live so long).


web 20 conference.gif
I have been thinking a lot about second acts lately.

Part of it is my work with Voic.Us. I'm having to become a system administrator, at least part-time. I am trying to recruit a staff, some paid and some not. I'm trying to be an executive.

These are roles I never took on before. I wrote about them, I critiqued them, but I never had to play them before. And there are times when they make me tired.
There are other reasons, on my regular tech beat, for me to think of second acts. The great tech companies founded by my generation - Microsoft, Dell, Apple - are all into the second act thing these days. Apple's is highly successful, as Steve Jobs has become a consumer electronics mogul, a content gatekeeper. Microsoft's second act has not been so successful. Bill Gates keeps fiddling with the deck chairs, and in the latest fiddling a guy near my age, Jim Allchin, found himself forced into retirement.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Consulting | Futurism | History | Journalism | Politics | Security | blogging | ethics | fun stuff | personal

October 06, 2005

The Secret Behind the Quick Sales?

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Posted by Dana Blankenhorn

myspace logo.gifInternet businesses are easy to get into, easy to compete with, easy to replace.

This is a truth Internet entrepreneurs know and big media companies have yet to find out.

That's why Jason Calacanis sold out Weblogsinc after just two years. That's why the owners of MySpace were willing to take Rupert Murdoch's money so quickly.

They know they can come up with another idea quickly, and compete effectively with it quickly, if they get unhappy with their new corporate parents. They also know that their peers in this business know this, and would gladly sell out to the same companies if they don't.

Thus, as soon as a position is a established, and a big company thinks, "ah hah, a barrier to new competition," the owners of those companies are going to take the money.

They know there's no such thing as a "barrier to entry."

The cost of building a scaled Web site is falling, not rising. It's attention and talent which are the quantities in short supply. So talent will take the money and look for the exits every time, knowing that, since no one online knows you're a dog, no one knows that you've slipped your chain, either.

What does this mean about today's Weblogsinc deal?

...continue reading.

Comments (0) + TrackBacks (0) | Category: Business Models | Business Strategy | Copyright | Economics | Futurism | Internet | Investment | Journalism | blogging | e-commerce | online advertising

Thoughts on Web 2.0

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Posted by Dana Blankenhorn

web 20 conference.gifSan Francisco is hopping this week over Web 2.0.

What is it? It's a database.

When you use a database as your basic site design template, then everything becomes a database call or a database interface. Thus, you can do anything. You can do blogging, you can do identity, you can do customization, you can do community.

The problem is getting stuff into that database. Can you share data among databases? Users don't like that. But how do you get permission for all the relevant, needed data to get into the database?

The obvious answer to that is that users have to live inside the database. A lot. This restricts choices, because time is limited. It means there are only a few "winners" -- a few sites will scale to get everyone's data and everyone else will lose out.

Thus there's a self-liimiting aspect to Web 2.0 trials. with Sxip, you can take your personal data (the stuff that would fill a database) with you, and control it. Then you point that data to whatever database you choose to be a member of.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Business Models | Business Strategy | Copyright | Internet | Investment | e-commerce | marketing | online advertising

Blogging's AOL Moment

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Posted by Dana Blankenhorn

jason calacanis.jpgThe dot-boom ended when AOL bought Time-Warner. (People forget that AOL shareholders got 60% of the combined company's shares.) Will the blogging boom also end with an AOL purchase?

I ask because friends of mine in the business are thrilled over AOL's purchase of Jason Calacanis' Weblogsinc for a price reported to be $25 million. (Russell Buckley thinks AOL overpaid.)
Calacanis' company is probably the biggest in this space, but $25 million is less than the cost of a single good magazine title.

The bloggers are happy because they assume this means they now all have high-paying jobs with AOL. I don't know if that's true or not.(Jobs, yes. Highly paid? I don't know.) I'm wondering, however, just how big a business phenomenom rolling-up the news end of blogging can be, if the top group in the field is worth only that.

...continue reading.

Comments (4) + TrackBacks (0) | Category: Business Models | Business Strategy | Investment | Journalism | blogging | e-commerce | online advertising

October 05, 2005

Gas Rationing

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Posted by Dana Blankenhorn

gasoline sign.jpgThat's the issue no one will approach. No one will touch it.

Yet it has to be touched. And now.

According to energy experts, we need to see demand for gasoline drop 5% or else we'll be drawing down stocks at an unsustainable rate in the next few weeks. So far it's down 3.5%.

So how do we get the rest? A Republican Governor in Georgia has ordered gasoline stations not to "gouge," to keep their prices in line with costs, and he's even sent out the cops to enforce this. The result is that many stations around me are out, at any price. One grade out, two grades out -- how many grades have to be out before we have massive gas lines all over the country? (Speaking of grades out, Perdue also asked schools to take two "snow days" in September to ease a short-term diesel crunch. What happens in January, Governor?)

So what are our alternatives?

  • Refineries can do what they've been doing, raising prices to force demand down. How far must they go. $4/gallon? $5/gallon? And what happens to that money?
  • We could set priorities. That means rationing coupons, A cards and B cards and C cards. Think George W. Bush is going to go for that?

What we've got from everyone so far is denial, and that ain't just a river in Egypt.

...continue reading.

Comments (6) + TrackBacks (0) | Category: B2B | Business Strategy | Consulting | Economics | personal

Who Should Lead Google?

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Posted by Dana Blankenhorn

Eric Schmidt.gifI wrote something today suggesting that Dr. Eric Schmidt leave Google.

I was told, by my editor, that it was over-the-top. "A series of cheap swipes," "rather than a reasoned case."

Maybe it was. I didn't post it. I wrote something much milder, more humble, more seeking of counsel rather than snarky and smart. (I like editors. They save us from ourselves. They're very important people. Buy an editor lunch today.)

But like many people here I feel a personal kinship to Google. And I think that is the company's chief asset. Mess with my GoogleLove, and you're messing with your own GoogleSelf.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Business Models | Business Strategy | Internet | e-commerce | online advertising

October 04, 2005

Super Bear

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Posted by Dana Blankenhorn

Robert_Prechter_small.jpgI've always had a soft spot for Gainesville, Georgia economic analyst Robert Prechter.

Back when I started in journalism, at the old Houston Business Journal, Prechter was the "super bear" we'd turn to when we wanted some "the sky is falling" quote. Bulls are usually right, but when bears, especially Super Bears like Prechter, are right, they're really right. Starting in 1981, in Houston, Prechter was really, really right.

Prechter bases his analysis on the "Elliott Wave," an idea from R.N. Elliott that economic cycles run in six regular patterns -- small up, small down, big ups, big down, then super ups, super down.

The Great Depression was a Super Down. The Panic of 1837 was a Super Down. Prechter figures we're about due.

One reason you haven't heard more from Prechter lately is because of his 1995 book, At the Crest of the Tidal Wave. Those who took Prechter's warning of a bust when he made it missed out on the 1990s boom, missed out entirely.

But eventually even Cassandra is right, and when she's right, boy is she right. Thus, Prechter is back with "Conquer the Crash: You Can Survive and Prosper in a Deflationary Depression." He autographed a copy for me. Thanks. I read it.

...continue reading.

Comments (0) + TrackBacks (0) | Category: Economics | Futurism | History | Investment | personal

More on The Internet Break-Up

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Posted by Dana Blankenhorn

Paul vixie.jpgDiscussion of the possible DNS fork by the UN or ITU continues on Dave Farber's always interesting Interesting People list. (And if Dave Coursey doesn't like it, he can leave.)

Perhaps the most interesting comment was this from Paul Vixie, father of BIND:

I've pondered the meaning of all of this within the context of the dns protocol and of my company's open source
implementation of that protocol, and I think I can see a way to define and support alternate roots in a way that will reduce their chaos -- but not their harm. Given that the US-DoC/VeriSign/ICANN trinity pursuing "a policy contrary to their own interests" and that the inevitable result of this will be hundreds if not thousands of chaotically interrelated dns namespaces, i'm ready to consider ways that DNS and BIND might be extended to make that inevitable condition less painful to live in.

But if i do it, it will be with rage in my heart against hose who could have helped us preserve name universality but who squandered that opportunity for short term political or financial gain. (Emphasis mine.)

...continue reading.

Comments (1) + TrackBacks (0) | Category: Digital Divide | Internet | Journalism | Politics | Telecommunications

October 03, 2005

Mesh Era Finally Arrives

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Posted by Dana Blankenhorn

mesh2.jpgThe mesh networking era is finally here, according to InStat.

A mesh, in which all devices on a network are connected to all other devices, finally has a hockey-stick chart. InStat's new report has last year's $33.5 million in sales growing to $974.3 million in 2009, a classic hockey stick formation.

InStat credits military needs with developing the technology, but there are many advantages to installing a mesh as opposed to a single hotspot:

  • A mesh can cover a large area.
  • A mesh can make certain the coverage area is completely covered.
  • Mesh can connect to many different access technologies, not just WiFi but UWB and WiMax on the wireless end, or WiMax and a fiber pipe on the backhaul end.
  • Mesh is primarily a North American technology.

...continue reading.

Comments (1) + TrackBacks (0) | Category: 802.11 | Always On | Futurism | Internet | Telecommunications

Music Industry Profits Down

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Posted by Dana Blankenhorn

ifpi.jpgThe big news in the recording industry's results today are not the growth of digital sales, or the continued fall in CD sales.

It is that the industry has become addicted to lawyers in order to maintain its business model. And those lawyers will bleed the industry dry long before pirates can.

Here is the money quote from John Kennedy (no relation), who chairs the International Federation of the Phonographic Industries (IFPI):

"Without the legal crackdown, it would be a different situation. You certainly have to have the legal services to make it all work."

In other words the industry assumes that without the terror of lawyers its current success would be unsustainable.

Which is precisely why it is unsustainable.

...continue reading.

Comments (0) + TrackBacks (0) | Category: Consumer Electronics | Copyright | Economics | law | marketing

This Week's Clue: George Lindsay

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Posted by Dana Blankenhorn

This week's issue of my free weekly newsletter, A-Clue.Com, was closer to the subject of this blog, talking about international economics. (Subscribe here.)


john lindsay.jpgIt's a special responsibility to have a reserve currency. (The picture is of the late John V. Lindsay (1921-2000), Mayor of New York from 1966-1974.)

The honor is not lightly given. History requires liquidity, military power and a reputation for sobriety before it grants the honor. The honor, once lost, can never be reclaimed.

Until the 19th century gold was the world's reserve currency. The British pound became a reserve currency only because it was believed to be tied to gold. Precious metals make good reserves because their supply is fairly fixed. They're difficult to mine and extract. Gold's ability to serve as a reserve currency in this century is being undermined, in part, by new chemical mining techniques which dramatically increase yields.

The American Indians' reserve currency of choice until the 17th century, wampum made from mother-of-pearl, was undermined by the western invention of a machine that let colonists mass produce the stuff.

The lesson is simple. A reserve currency must be supply-constrained. If it can be inflated, if it is over-inflated, it pops and ceases to have value.

The U.S. dollar has been the international reserve currency since 1945. Spending produced liquiity, our armed forces brought us victory, and our central bankers knew to take the punch bowl away when the party got going.

Democrats lost the faith of the world's other central bankers during Vietnam. By spending on both guns and butter we ran what looked like large deficits. The first Nixon budget showed a surplus. Democrats have never recovered that faith. Even the reign of Clinton was accompanied by the conservative Republican Alan Greenspan running our central bank, the Federal Reserve. By the 1990s there was no real alternative to the dollar as a reserve currency.

...continue reading.

Comments (9) + TrackBacks (0) | Category: B2B | Economics | Investment | Politics | Security

October 02, 2005

Race to the Bottom

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Posted by Dana Blankenhorn

bugs bunny elmer fudd.jpgThe U.S. and China are in a Bugs Bunny situation.

You've seen it. Two characters are falling through the air, but they are still fighting over which one will hit the gruond first, Galileo be damned.

In the cartoon, one character "wins" (always the protagonist) and the other goes splat.

In real life, it doesn't matter much which one reaches the bottom first. They're both going down.

The U.S. and China are the cartoon characters, the fall is history's greatest ponzi scheme. The U.S. imports goods and exports debt, while China imports debt and exports goods. Both sides pretend to be growing, and that growth is used to prop up corrupt regimes. In fact the U.S. debts can't be paid without destroying the currency, and the Chinese government is still losing the race against its own people.

I reflected on all this today on reading an AP story on China's new "Internet controls." The story stated "The government says there were 74,000 major protests last year nationwide." Most were over corruption, the seizing of private land (Chinese peasants don't like Kelo either), and pollution.

These protests are happening, and growing, despite an increasingly-restrictive Internet censorship regime. But the logic of that regime is self-defeating. You can't control thoughts. You certainly can't both control thought and increase prosperity. Not for long.

...continue reading.

Comments (1) + TrackBacks (0) | Category: Economics | Futurism | Investment | Politics | Security

This Tower of Babel Has Fallen

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Posted by Dana Blankenhorn

tower-of-babel-dark-big.jpgI'm about to go off on the Bush Administration again, but at least this time it's on a subject near to this blog's stated purpose.

Some days I think George W. Bush was imposed on us by our enemies. If there were a Manchurian Candidate, he is doing that candidate's bidding.

Our brave armies have been destroyed in Iraq. Our budget has gone from surplus to unrecoverable deficit, and our currency is heading south. The Gulf Coast lies in ruins while a system of kleptocracy that would make Vladimir Putin blush rules in Washington.

And now the Internet's gone.

What follows is from Milton Mueller of Internet Governance:

...continue reading.

Comments (4) + TrackBacks (0) | Category: Digital Divide | Futurism | Internet | Politics | Telecommunications | law | personal | war