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.
News of the Civil Rights lawsuit aimed at making Craigslist mediate its listings has hit The New York Times.
The Chicago Lawyers' Committee for Civil Rights Under Law says that the company’s current ads often violate laws against non-discrimination. People advertise to hire folks, or to rent apartments, and don’t think that “whites only” applies to them.
The newspaper industry is downright gleeful over this. Julie Bosman’s lead is dripping with sarcasm.
FOR several years, Craigslist.org has been aggressively taking classified advertising from newspapers.
Now Craigslist is the one under attack.
The story, and the suit, are deliberately misleading. They both ignore the fact that the ads in question are free.
In that way they’re not really ads at all. They are speech.
Which changes the legal principle. To force on site managers a responsibility to police all speech for all potential legal violations would render free speech impossible.
Both the municipal deal they signed in Philly and the one they’ve joined in San Francisco (with Google) carry user price tags. In Philly they say they will re-sell capacity to other ISPs for just $9 per user per month. In San Francisco the plan is to give away 300 Kbps links, but charge $20/month for true ADSL-like speeds.
I’m of two minds on this. Let me talk out of both sides of my mouth for a moment:
Earthlink is betting the company on this new way of doing business. The San Francisco investment alone is estimated at $25 million. They have to get their money out somehow. And they have to gain some control of infrastructure in order to stay in business, now that the Bells and cable guys have gotten Bushie permission to monopolize the rate-payers’ infrastructure.
On the other hand what happened to free? And how can the cities promise any exclusivity in these deals? They don’t have any more right to the frequencies than Google. Why should taxpayers let them offer exclusive access to traffic lights and other city-owned infrastructure, and grant an “exclusive” cloud license to anyone?
As a business story it may be 100% accurate. As a barometer of blogging itself, it's dead wrong.
Blogging is not a separate business from the Internet. Blogging is simply another way of producing a Web site. It brings coherent, regularly-updated Web sites within the budgets of every business, every individual, everywhere.
Blogging can be journalism. A blog can be a personal journal. A blog can be a store. A blog, like a Web page itself, can be anything you want it to be.
So when someone writes "blogging bubble about to pop" and cites a few business case studies involving the creation, purchase and selling of companies involved solely in blogging, I laugh. Because that's not blogging.
But this time, the industry insists, it's different. This time it's e-mail marketing.
Leading the charge is an outfit called Advocacy Inc., headed by Roger Alan Stone (he uses Alan so you won't confuse him with the OTHER Roger Stone). Their client list includes a large number of names and organizations from the left side of the aisle, including Tim Kaine, who won Virginia's governor's race last year.
What makes it different? Stone insists his company is using all the disciplines of the old paper direct mail business to trim lists down to names of real prospects. That means he prospects from existing lists, like those of Moveon.org, which he knows are opt-in. And he limits his mailings further through targeting, so liberals don't get e-mail about Oregon candidates if they're living in Georgia.
Had the e-mail marketing business been doing this 10 years ago today's spam problem would not have happened. But it did, and it did. As a result, any list to which people are sent e-mail without notice is considered spam by most users.
But not the government. In writing the CAN-SPAM Act the government was very careful to make itself (and the politicians who work for it) immune from the legal charge. What Stone is sending is spam-that-is-not-spam. It is legal.
But is it ethical?
The National Journal Hotlinehas a feature up on Stone today, which conflates Stone's story with those of other folks, notably Tim Yale of VButtons Inc., who are actually in different businesses. (In VButtons' case, it's embedding webcast ads in Web pages.)
What they wind up doing is merely confusing the issue.
The funniest Super Bowl ad was probably the FedEx bit with the caveman saying "it's not my problem" FedEx hadn't been invented and the other caveman's package got stomped by the dinosaur. (Although my 14 year old son howled at the Diet Pepsi Jackie Chan set-up, with a Diet Coke getting squished as a "stunt double.")
The most important ad, however, came at the end. It was a fairly straight ad, although (like everything else about the game) horribly overdone. In it a man with a cellphone walks through a world populated by sports of all kinds -- baseball, football, basketball, NASCAR and track all going on around him.
It was a house ad, really. It was for Mobile ESPN. ESPN is owned by Disney, which also owns ABC, which ran yesterday's game.
So why was it important? It was important because neither ESPN, nor ABC, nor even Disney owns any cellular assets. They don't hold frequencies, or towers, or run networks. They are re-selling.
Richard Branson's Virgin Mobile has already created billions of dollars in equity value through cellular wholesaling. Others want into the business. It's a good business, good for the wholesaler, and good for the network (usually Sprint) doing the wholesaling.
Yet this is the business the Bell companies have spent the last decade destroying when it comes to Internet access. They ignored the promises of the 1996 Telecommunications Act. They killed all the CLECs, claimed they didn't have to wholesale on "new builds," made everything a new build (even cutting copper to guarantee it) and topped it off by getting governments on the state and federal level to sign-off on the scheme.
Verisign CEO Stratton Sclavos is a big investor in incumbency. And he gets value for money.
OpenSecrets.Org reports that he gave $84,000 in political contributions during the 2004 cycle, and has (with his wife) given another $24,700 in 2005. The Verisign PAC, meanwhile, has spent another $36,200 this cycle, in hard money contributions.
That’s not all. The same Web site reports Verisign put out $124,000 in “soft money” contributions during 2002, and $88,600 in the 2000 cycle. While some of the money (about 15%) goes to Democratic incumbents, the vast majority goes to Republicans.
That's just the money I found searching OpenSecrets under Verisign and Sclavos. It doesn't count other money that may have been sent from Verisign executives, or their families, or third parties under Verisign's direction.
What does Verisign get for this money? It gets the full legal authority to rob the Internet, to take you, for everything it can grab.
HIPAA stands for Health Insurance Portability and Accountability Act. It was signed by President Clinton in 1996, when he was trying to triangulate the new Republican majority in Congress with the idea of regulation, but managed by the private sector.
”HIPAA is a toothless tiger,” says Info-Tech analyst Ross Armstrong. “The first problem is that HIPAA is complaint driven, and complaint-driven enforcement doesn’t work. The second problem is that in the one HIPAA-related conviction that has occurred, only the individual was charged, not the organization itself."
“If HIPAA is to be truly protective and useful, healthcare entities and their executives must be held accountable in the same way that Sarbanes-Oxley holds CEOs and CFOs responsible.”
I'll go Armstrong one better. HIPAA is worse-than-useless.
HIPAA isn't entirely to blame for this, but it has driven the bulk of the medical profession into a very expensive case of Luddism. That's because HIPAA:
Theoretically makes hospitals and insurance companies liable for mistakes; and
Lets small practices out of this problem by refusing to computerize.
Mistakes in records and their release can happen. They do quite often. By accident. Not on purpose. But because there are automatic penalties (if someone complains) two things happen. The handling of all patient information becomes heavily bureaucratized, and patients are given legal gobbledygook aimed solely at keeping them from pursuing their rights if they arre violated.
It's the small practice exemption that really bites, however.
A few years ago some wags talked about people having a "right" to Internet service, and they got laughed at.
Let's try it another way.
America's economic future requires every citizen have access to Internet resources, and full freedom to use them.
Everyone needs Internet access, and literacy, to be part of the modern world.
FAST Internet access. Just as it's stupid to tell someone an 8086 machine is equivalent to a modern computer, so it is sheer ignorance to claim the availability of dial-up means everyone has Internet access. It's got to be fast enough so all modern applications run.
In a recent essay Visicalc co-founder Bob Frankston compares the Internet to roads. In a recent piece here at Mooreslore , I offered something similar. What if the railroads had a veto over road development, I asked, even after the car became popular?
But this dramatically underestimates what we're talking about.
The Internet is becoming a universal database, a universal discussion, almost a hive mind for humanity in the 21st century. If you don't have access you can't contribute. And you can't benefit, either.
This is the Century of the Mind. We've already seen business gravitate to those cities with the best connectivity, with the best chances for minds to connect. That's what Silicon Valley is about. That's what Boston is about, what New York is about, what Atlanta and Austin and Washington are about. Connections.
But with the Internet it's not just cities which are judged on their connectivity. It's nations.
And we're falling behind. Already, just in the last few years, we've fallen to 19th in broadband penetration. We're about to be passed by Slovenia, for God's sakes! Slovenia! Slovenia was, in the 1990s, part of Yugoslavia, a country which destroyed itself in civil war. Now Slovenia is passing us in the access its citizens have to the Essential Resource of our Time.
Why is this? Simple.
We've allowed Internet service to be monopolized by two sets of companies - Bell companies and cable operators - who are paying for obsolete infrastructure, who are forcing us to pay for that infrastructure before they deliver more, and who think only in terms of billing for specific services, not selling bits.
The Internet is just bits. Video bits, sound bits, e-mail bits, Web bits, text bits. The meaning of the bits are defined at the edge, on the computers that exchange them. All producers are consumers, all consumers can be producers. But the gatekeepers won't accept that. They see the Internet as services - TV, phone, e-mail - billable events which they define and they control.
And so, with Internet connectivity held hostage to these so-called "service providers," your ability to be part of the future atrophies, disappears, dot by dot, bit by bit. So does America's competitiveness.
Frankston calls the process through which this has happened the Regulatorium. He's talking about a network of political connections, state and federal agencies, think tanks and Bell-sponsored "consumer groups" who push the Bell-Cable duopoly more effectively than Jack Abramoff's K Street Project dreamed of.
Here, he says, is what we need instead. Some simple statements:
Connectivity is fundamental. The Internet is not a service. The Regulatorium doesn't have the language for this. Giving it the language is the leverage point.
Speed is useless if you can't communicate. It's easy to speed up the network - what we need is pervasive connectivity. This means that wireless connectivity - be it Wi-Fi or other protocols is our basic right.
Rather than giving carriers the ability to define our services, connectivity must be infrastructure like roads and power lines and "just be there". We can then create services and solutions.
This is light years from the way the world works today. But we have to get there.
I've written a lot about these issues here, tangentially. Moore's Law drives the world, not just as it relates to chips but as it relates to telecomm technology too. Moore's Law of Fiber shows that optical fiber capacity can grow exponentially, just by changing out hardware. Moore's Law of Radios shows we can have the same capacity increases using the air that we have with fiber.
All the laws and rules we have in place for telecommunications are based on the idea of scarcity. Capital to build networks is scarce, so only a few big companies can play. The frequency spectrum is a scarce good government must distribute.
I don't know of a better way to say this, so I'll just say it.
This week's issue of A-Clue.Com is on-topic (for once).
It's about e-commerce, and about how to make start-ups work.
Specifically we're talking about what it takes to get a start-up launched and the character of a successful entrepreneur, who is at its heart.
You're invited to join the A-Clue.Com community by clicking this link. Always free.
I learned a great and terrible lesson recently.
While it's true that anyone can launch a business, an entrepreneurial business must be a team from the start.
Sure, you need the entrepreneur, the idea person. You need someone who can find the money, who can sell the scheme, who can adjust to events, who can lead. You need someone of boundless energy, determination, ambition, and (especially) ruthlessness.
If your business is going to be on the Internet, you need a content guy. Having an Internet business without a content guy is like having a restaurant without a chef. On my latest venture, I'm the content guy (not the entrepreneur).
The content guy is committed to the editorial mission of the site (and even stores have an editorial mission). The content guy has contacts, a voice, an understanding of what's needed to attract attention and credibility. A content guy might be able to run the whole show himself, if this were a small business. But it's not, so keep the content guy in his place.
There's a third team member needed, and many businesses fail to plan for this. That's the tech person. In a restaurant this would be the maitre 'd. In an old-line manufacturing business this would be the engineer. In retailing it's a number cruncher. A geek, in other words. Gotta have a geek.
While today's Web tools are much more powerful and simple to use than ever before, they're still tools. Every step toward simplicity is matched by a step toward power. While users may use your Web site to simplify their lives, or even their own creation of content, that's not how it works inside the site business.
Everyone hates spam. But there has been no political constituency potent enough to fight the well-organized Direct Marketing Association, which has successfully defended spammers from meaningful regulation for a decade.
Now Matthew Prince, a young Chicago lawyer, thinks he has the answer. Porn. Well, anti-porn.
Using the Christian Right as his political base Prince’s company, Unspam Inc., has gotten laws passed in Utah and Michigan that could both make him rich and make most e-mail disappear. While fighting for the law in a Utah court, he has taken his show on the road to Georgia, Illinois, Wisconsin and Minnesota, trying to get identical laws passed there.
The laws create a “do not porn” registry, run by Unspam, that e-mailers must filter their messages through. Anything in an e-mail deemed “harmful to minors,” even in a link, becomes a felony. Not just porn offers, but alcohol, tobacco, gambling, firearms and illegal drugs are covered. Parents on the list get the right to sue for up to $1,000 per message (Utah) or $5,000 per message (Michigan). There are also criminal penalties, including jail time.
Prince spends money through his “base,” using Susan Zahn’s WDC Media (the same folks used by Christian broadcasters) for his PR, and emphasizing the porn angle in his releases. An Unspam press release sent out via Webwire identifies only the porn industry as fighting the new laws.
But the direct mail industry is now energized as well. WindowsSecrets editor Brian Livingston put out an article on Earthweb last year blasting Prince as essentially a patent troll. (The company has filed U.S. patent application 20040148506 to protect its registry, he says.) Prince claims he wins his registry contracts through competitive bids, but if you got the law through and patented the required technology, well, you figure it out. (I should note here that WindowsSecrets is an e-mail newsletter, so Livingston would have to filter his lists through Unspam if the law holds up in court.)
A recent Wall Street Journal story on Unspam estimates compliance costs this way:
Businesses are charged $7 for every 1,000 email addresses examined each month in Michigan, and $5 per 1,000 in Utah. Companies must have their lists examined once a month. A company with a list of 100,000 emails would pay $14,400 annually to have its list examined by both states. Unspam receives the majority of the revenue to administer the registry, and the rest goes to the state.
Livingston disputes the WSJ conclusions. He says monthly screening won’t protect e-mailers, that 85% of the money goes to the state. He then offers two illustrations of how easy it would be for the law to be abused:
A conservative activist puts her e-mail address, which is also used by her daughter, on a state registry. The listing takes 30 days to become effective. She then e-mails a health clinic for information about morning-after pills. If the clinic replies with the information, the sender is guilty of a felony.
A liberal activist registers his and his son's e-mail address. After 30 days, he e-mails a gun dealer, asking for product listings. If the dealer replies with details, he's guilty of a felony.
The Walt Disney Co., including ABC, ESPN, the movies, the theme parks -- the whole shebang -- is presently valued at about $50 billion. That's actually about one-sixth less than it was worth five years ago.
Apple Computer Corp., by contrast is worth $65 billion. That's about eight times more than it was worth five years ago.
I decided to note this after reading about how Disney wants to make a move on Pixar, for $6.7 billion, and how that would result in a "pivotal" role for Jobs at Disney, with Steve as Disney's largest shareholder. But before he bought that pig in a poke, you'd think Steve would consider how becoming the "largest shareholder" of a media company worked out for Ted Turner.
Uh, uh. Instead of selling Pixar, Jobs could easily offer a three-way Apple-Pixar-Disney tie-up, in which Jobs and his team would own about two-thirds of the resulting company.
So the question occurs, does Jobs want to run Disney?
NOTE: I'm promoting this to the top today because of its comment thread.
When I first interviewed Richard Wingard back in September, I thought little of it. He seemed to have a clever way to research basic research, using individual investors. He promised new technology enabling video compression on cellular and dial-up lines. Cute.
Then some of Wingard's investors started commenting here. The number of comments grew and grew. They've turned this comment thread into their own little clubhouse, swapping takes and rumors on the company's promised sale, which in the interview Wingard said would happen some time this year.
Interesting. Enjoy the thread, and if you're part of it, thanks for visiting. We do other stories.
Richard Wingard has figured out a way to fund cutting-edge technology with angel investors, and hold them in their investments for nearly 7 years. (The picture is courtesy the University of New Hampshire alumni association.)
Wingard runs Euclid Discoveries, which is working on an object-based video compression technology he says will deliver 10 times the performance of MPEG-4, enough to "turn your iPod into a DVD player."
And he's done it all with angel investors, who are best-known for backing only early-stage customers. Wingard has rejected the entreaties of venture capital firms, saying their time frames for pay-outs are too short. Yet he has succeeded in getting angels who will wait as much as 7 years for a private auction of his technology, and a distribution.
The Media PC ain't gonna happen. The "walled gardens" of the cell companies are going to come down. The telcos' plans in cable are non-starters.
All these huge corporations are subject to the Content Chimera, the idea that networks are pipes for selling content to people, and that it will all "converge" somewhere.
This is nonsense:
TV standards are moving toward those of movies. None of the "Media PC" offerings at CES took HDTV into account.
Networks are not pipes for selling content to people. They are two-way bit pipes. The future is synchronoussymmetrical, not asynchronousassymmetrical.
It's not all going to "converge" in any particular place. We will seek to consumer entertainment where we are, with whatever attention we can give. But we also create, we communicate, we interact. Different levels of attention require different types of devices.
The Content Chimera goes nowhere. It's the technology version of the Oil Chimera that now drives America's relations with the world. The solutions in both cases are remarkably similar.
Interactivity.
The "choke point" for the content market is NOT in production, or distribution, or marketing. It's in each one of us. It's in the time we have to consume, and the attention we can give to creation. Creation of content, by its nature, involves the consumption of older content, and the laws must reflect this, or they're economically non-productive. (Energy creation and consumption must similarly become a two-way street, all of us creating what we can from the Sun or wind or heat around us, and the current grid evolving into something remarkably like the Internet. But that's anoither show.)
The news business is going to try cracking down on the Web this year.
Already, I'm seeing all news pictures, even common mug shots of celebrities, given labels. They're small, usually in a corner. They read AP or AFP or Reuters. But they mark these pictures as property, and allow the rights-owners to track them as they're used on other Web sites.
The next step, of course, is to send out RIAA letters to Web sites, demanding that the pictures be taken down or (more likely) that the news agencies be paid cash money for their use.
Personally, I'm avoiding the issue by avoiding the pictures, but that's not likely to be viable over the long run. Because just about every image file out there is owned by someone, and most don't have Creative Commons logos on them.
Melinda Gates is more than worthy. She gave humanity to a man who needed it desperately. And in turn she is shaming the rest of us into action (well, those of us with hearts and brains).
What struck me most in Times' cover story is how old Bill looks. He's younger than I am, for gosh sakes! (Oh, right.) His face is lined, his neck is stretched. Only a few pictures showed anything different -- those where he was looking at his wife.
Bill married Melinda rather late. He was 39. It was the year his mom, Mary, passed away. Melinda was a product manager at the company. He was ready. What she saw in the shuffling geek I don't know. It wasn't the money.
Melinda changed Bill into someone Mary would be proud of. She's as bright as he is, but she brought a new perspective to Bill's life, and a moral imperative he had avoided for years. She gave him back his humility, she took him out of his mind and into his heart, a place many geniuses never get to go.
While you're all tucking into your Christmas turkey the hype machine for the next round, the Consumer Electronics Show in Las Vegas, is already filling media inboxes.
CESlong-ago replaced Comdex as the technology industry's premier trade show.Somewhere between the Internet and the iPod, computing bifurcated into a gadget market, which is CES' bailiwick, and a server market, which doesn't need the trade show hassle.
One 2005 success you've probably got under your tree right now is the games DVD. It may be a sports title, a fashion title, or a trivia title. It sells based on the brand (ESPN, Trivia Pursuit) standing behind the maker (as opposed to a publisher's brand). Play is divided between some sort of game board and the TV, on which the DVD plays the answers.
The next step in that evolution is bringing the Web into the mix, making the whole thing instantly updateable, and providing a continuing revenue stream in terms of new content and Web stores. That's what NetBlender is touting. They sent two PDF press releases here today (the bulk of the site is password-preotected) and the language would make P.T. Barnum proud.
This has never been true. From the beginnings of the service, in the 1990s, eBay deliberately tried to hold its security expenses to a minimum.
First, "the community": was to be relied upon. Then you were told, it's your risk. The eBay financial system has never been a member of Visa because achieving that level of security would be too expensive. So eBay bought PayPal and tried to turn it into a private bank -- only it lacked banking security.
It is natural to rely on cops in the financial world -- after you have done everything possible to protect yourself. That costs money, and money is something eBay has always been reluctant to spend, at least on computer security.
Now eBay admits that many accounts are being hijacked by crooks, and it acts surprised. Once again, they seem to blame crime victims and "phishing" e-mails when in fact it's their own security (or lack of it) that is at fault.
Successful eBay merchants have been pushing-back on this story, with letters claiming they're happy bunnies, but they're insiders here.
The fact is that eBay has never paid-out what was necessary to assure any level of security. It has pocketed that money as profit, and now it's reaping the whirlwind for that.
What motivates a blogger most? (Image from the blog of James P. MacLennan.
Traffic.
It's not really money, although money is nice. What bloggers want more than anything is traffic, and the attention that traffic generates.
Traffic validates. Traffic defines our value within the blogosphere.
There have been many attempts to calculate this over the last few years. There were blogrolls. There are link numbers. But these are mere approximations. What we want are page views, audience, comment strings so long that we ignore them or (maybe better) turn them off (because we're now so powerful and important).
Despite the talk among bloggers about how we transcend the "old media," what jazzes us more than anything is a TV or radio appearance. Then, unless we already work in TV or radio (in which case our blog starts with a huge head start) we put on our best suits, we luxuriate in the makeup chair, and we preen for the cameras.
I've often said writers are shy egomaniacs, and it's on display all over the blogosphere. Even though the talents needed in writing, blogging, and TV appearances are all quite different, what most bloggers really want is to be, in some small way, "king of all media" (at least in our minds).
Now, what are the business implications of all this?
But it would solve a lot of problems, most especially for the Bells, who would be the idea's staunchest opponents, if it were proposed. (It's not being proposed. I'm just blogging here. This is a thought experiment.)
The problem is there is billions of dollars in copper infrastructure that is becoming worthless faster than the loans made to build it can be paid off. This fact is the elephant in the room no one wants to talk about.
So throw those assets, and the debt behind them, into a pot. Sign yearly management contracts with the present owners (mainly the Bells) to keep those assets going.
Then anyone who wants to build on those assets (including the Bells) or provide services using those assets (like ADSL) can do so without discrimination. The Bells no longer have an incentive to stifle competition. They do have an incentive to build, to build fiber, to build what amounts to a cable system, because every dime they use in that effort is a new dime, and every dime that comes in as a result of that effort is their dime.
The Bells would all create management arms, and cash flow from the contracts. But the corporation as a whole would have a different set of incentives. It would want those costs kept down. It would be pushing all its assets into advanced services, and seeing the management company as a cash drain. Fine. If they try to starve the management company, there would be a process by which customers could complain and have a new manager appointed.
For the last few days I've been needlessly obsessed with a study I found at Georgia State University, about peer-reviewed journals. (The image is of Fondren Library at Rice University, where I got some really great naps during the 1970s, and worked for a peer-reviewed journal.)
The article cites a study from England indicating academics prefer peer review to simply posting studies on the Web and letting everyone criticize them.
I grabbed hold of a telling detail, while nearly half believed open access (as using the Web is called) would undermine the current system, 41% said that would be a good thing.
I should have waited, because today the folks at Georgia State gave me (as they say) "the rest of the story."
It's an article in Library Journal which the publisher (Reed-Elsevier) has conveniently declined to make available on their Web site, which offers the smoking gun.
The article, by Theodore Bergstrom and R. Preston McAfee, charged that the publishers of peer-reviewed journals are collecting monopoly profits on labor donated to them by universities.
It's time to recognize a simple fact and react to it: the symbiotic relationship between academics and for-profit publishers has broken down. Large for-profit publishers are gouging the academic community for as much as the market will bear. Moreover, they will not stop pricing journals at the monopoly level, because shareholders demand it.
So far, universities have failed to use one of the most powerful tools they possess: charging for their valuable input. Journal editing employs a great deal of professorial and staff time, as well as supplies, office space, and computers, all provided by universities.
Academic journals cost very little to print or distribute. They are produced, in fact, by researchers who agree to be part of the peer-review process. They are a bottleneck through which knowledge must pass before the rest of us get a crack at it.
Yet these same journals are owned by for-profit publishers, who keep raising their prices, forcing universities to pay for them, often with government money
At ZDNet Open Source recently I called this a battle between academe and open source. But in fact there's more to it than that. There's the abuse of monopoly power, and the acceptance of an abusive relationship by the academic community.
When private companies are allowed to gain monopoly profits, often paid-for by government funds, and act as a bottleneck to knowledge, something is clearly very wrong.
With apologies to Bergstrom and McAfee there are, in fact, several things schools could do:
I'd say we came out ahead. Skolnick is a leader in bioinformatics, the use of computer technology to model biological processes and steer research toward breakthroughs. Furcal is a good shortstop, but that's about it.
I'm being a bit flip here. The point is that cities and states are bound to do better going after academic superstars than sports stadia or fading industries. Yet most deals are aimed at sports stadia or fading industries.
Georgia, for instance, put over $180 million in tax revenue into building Philips Arena, where the elite eat sushi in luxury boxes lining one side, while the rest pile into seats on the other. They are offering all sorts of tax breaks to Ford if it will keep its Hapeville assembly plant open.
But for $5 million in laboratory expenses and $2 million for an endowed chair (some of it privately-funded) Georgia gets Skolnick, along with 19 colleagues and $1.5 million in grant money. Not a bad deal.
In The Wizard of Oz the Wicked Witch of the West writes "Surrender Dorothy" in the sky. But she can be destroyed by a bucket of water.
Microsoft's problems can't be solved that easily. And their best course at this point is for Bill Gates to retire.
As chief software architect and board chairman, Gates is in the way of what Microsoft must do in order to grow again.
I mean no insult by this. It's simple historical fact. Every businessperson, no matter how brilliant, has one act, one great achievement. Gates' was Windows, and all the politicking and marketing savvy needed to give it control of your PC. (Steve Jobs is the exception that proves the rule. The iPod is simply a reflection of his one true craft, which is consumer electronics marketing.)
But if a company is to survive and become a real institution it must have a second act, another life. And you get that with new leadership. IBM, Microsoft's arch-nemesis, has had three lives over the years with three great leaders:
Thomas Watson Sr. built the company around the punch card machine.
Thomas Watson Jr. re-built the company around the computer.
Lou Gerstner re-built the company again around services.
The Always On medical market won a big endorsement today from a San Francisco research house, FocalPoint Group, which advised hospitals that the technology is ready to lower costs and improve care.
The study projects that more than $7 billion will be spent on wireless data applications in the United States by 2010. Technologies, including WiFi, RFID, cellular, and low-rate ZigBee modules will be used to improve asset tracking, patient monitoring, and emergency response situations. In each case, these technologies are being implemented in health environments today and are expected to restructure the ways in which hospitals are organized and to handle patient needs.
In terms of the work I've been writing about these are fairly primitive applications. Track the medicine in the pharmacy, give doctors on call instant access to records they can read, that kind of thing. We're not yet talking about wireless monitoring of patients, or following those patients after they leave the hospital.
Despite this we're talking about huge savings:
With the vast majority of hospitals relying on paper-based systems, more than 770,000 Americans are injured or killed every year from adverse drug events, costing between $1.5 billion to $5 billion annually. Personal digital assistants (PDAs) can improve the legibility of drug orders while patient-worn wireless bracelets communicate information about drug allergies or deadly drug interactions -- potentially saving the healthcare system billions. In addition, long-range wireless transmissions and electronic patient records provide more complete and continuous data feeds about patient history, health and activities.
America's biggest tech companies are focused today on the problem of creating, not technologies, but platforms.
Not that there's anything wrong with that. Intel and Microsoft and Cisco all rose to prominence with platforms. The first two had "WinTel," a marriage now on the rocks (Windows works fine with AMD, Intel will make Apple chips). Cisco had the Internet platform.
These companies changed the world. But the world is a funny place, a "what have you done for me lately" place. In business, it's a "what are you going to do for me next" sort of place.
Microsoft, like it or not, has defined a platform strategy. To that extent, Windows still works. The problem is seen most visibly at Cisco and Intel. Let's tackle Cisco first.
The "problem" is that an Always-On data appilcation (say a heart monitor which phones the doctor when there are potential problems) won't use the network very often. (ABI calls these applications M2M, for "machine to machine.") As a "user" a heart monitor is a $10/month account (maybe). The distribution channels used for cellular, which depend on people, can't deal with that kind of account. (I'd always thought you piggybacked on your individual account, but never mind...)
The direct route is for the carrier to create a gateway, as Orange has in the UK. The problem with that is the carrier is only going to deal with large-scale developers. They might sign a deal with an ADT (for security) or a Honeywell (for home management), but not with a small, local guy -- too much trouble. The indirect route is to have someone else run a gateway equivalent, allowing the creation of a Movile Virtual Network Operator (MVNO) to handle data services. The trouble with that is that the operator gets cut out of some of the revenue, which they find unacceptable.
The result is nothing. There are no big application developers because there are no small scale successes. And there aren't any small scale successes because the carriers won't do business with them directly.
One of my biggest problems with the whole podcasting "phenomenon" is the shortage of good aggregation tools.
There are many Podcast organizers out there, in other words, but no one place you can go to see it all.
Until now. A Japanese outfit called Podium has launched a beta of just such a service. Here, on one page, you have all the major podcast "networks," and their top downloads, one-through-ten, along with direct links to the sites themselves. (Given its location, it's no surprise that the page is available in Japanese, Chinese, and English. The link is to the English-language page.)
The same page also features quick links to the RSS feeds of any existing aggregator. One-stop shopping.
Evaluating blog traffic has always been a dicey proposition.
There have been many attempts, with many different methodologies. There were blogrolls, hits, unique visitors, all sorts of nonsense.
Feedster has recently adjusted their methodology. They try to count all links, and discount the spam ones. The most interesting innovation here is the tag cloud, which you can see to the right of the list. Notice that popular tags are bigger than less-popular ones. The biggest remain politics and tech, followed by gadgets (which is a sub-set of tech). (Oh, and let's not forget to send a little link love to Robert Scoble (number 76), who turned me on to this.
What's interesting here is that these are subjects for which print publishers either have poor publishing models or failing ones. If you were invested in computer magazines over the last decade, you lost your shirt. Political publications have always been money holes.
As you will note from the headline, Corante is number 21 on the list, with 18,446 adjusted links. That's well ahead of such reportedly popular sites as Gawker, TalkingPointsMemo, Eschaton and Kottke..
You can see some of the unfairness right there.
Here I'm comparing a whole bunch of people (of which I'm proud to be one) to the sites of individuals. And, in fact, the big MSM blogging headline of 2005 has been the rise of "group blogs," so-called blogs that are actually running some sort of Community Network Service, like Dailykos (number four on the list), and the Huffington Post (number seven).
So let's be fair, with a bunch of group blogs Corante out-polled:
A lot. History. Image. Attitude. Branding. A rose by any other name would smell as sweet, but might not sell so well. Patagonia toothfish sounds nasty. Chilean seabass, on the other hand, we'll hunt that practically to extinction.
Names, in other words, have meaning. In the case of the new AT&T, the old SBC, the older Southwestern Bell, the name means control. Control of your telecommunications experience, of what comes out of the wire or through the air, control like the old Ma Bell had. (A gracious good afternoon...)
But control is beyond the reach of any phone company in an age of Moore's Law. Moore's Law of Fiber makes it impossible to control the backhaul market. Moore's Law of Radio makes it impossible to control the wireless market. The only way to maintain control, in order to pay-off capital costs, is through government fiat.
The Bell System, the old AT&T, had that kind of control because capital was short and beause it accepted strict regulation of its rates. The new AT&T can never have that control, because capital is abundant and because it refuses to accept rate regulation.
A few simple questions are all that's needed to knock this one down like a last-second Hail Mary:
The Media Center PC spec has been a market failure.
Nothing here about who's going to make these boxes. Notice?
TV displays, in the age of HDTV, have moved miles from the standard PC aspect ratio.
The fact is the actions of watching TV and using a PC are different. With a TV, you're mostly passive, except for that remote in your hand (and we know who you are). With a PC you're constantly active.
The launch of so-called Open Source Media (no, they're not open source, in fact they try to keep people from even using fair use quotation through a EULA, don't get me started ) is proof that a Blogging Bubble is well underway.
Why? No business model.
Everyone doing a blogging network, whether AOL (Weblogsinc), Gawker Media, Metroblogs, Huffington Post, OSM, you name it -- they're all using a media strategy. And Dana's First Law of Internet Commerce is:
It's not publishing, it's not TV, it's the Internet.
Any strategy based on bulk advertising, based on pure page views, is going to fail. No strategy based on pure star power can succeed, because it doesn't take into account the fact that stars fade and stars emerge. (It's not who you are, it's what you're saying, that counts.)
There's a lot of hyperbole there. (Patrick Henry, right, was nothing if not hyperbolic.)
But the fact is that the tools and technologies needed to create a "hot zone" -- an area that can get 802.11 wireless coverage -- keeps going down.
There is no need for such zones to be defined by political boundaries. There is no need for there to be just one such network in an area. There are tons of places near me that have multiple networks in reach. That's the beauty of the unlicensed band.
What you need to deliver a HotZone to a corner, a neighborhood, or a development are:
Antenna arrays that let you serve your whole service area efficiently, by which I mean efficiently in terms of spectrum use.
The biggest danger to this vision is coming, the mergers of local and Internet backhaul outfits to be known as Verizon and AT&T.
If those companies are allowed to consolidate and control Internet backhaul and sell it through an eye-dropper, as they now sell broadband through an eye-dropper, then they can halt the American wireless revolution in its tracks.
One of the strangest aspects of the post Bell break-up era has been the continuing Bell fascination with content.
The reason for it: cable envy.
While phone service, and Internet service, take money only for bits, cable companies have long made money three ways. They make money on the bits they transmit, they make money from the content companies sending those bits, and they make money from local advertising.
Seen from that point of view, Ed Whitacre’s nonsense about charging Google rent for reaching “his” customers makes a little sense. It makes more sense when you look at history. ADSL was first launched a decade ago as a way for phone companies to offer cable service. BellSouth, Sprint, and MCI all bought MMDS bandwidth in the 1990s to deliver wireless cable service.
The triple play has nothing to do with consumers, in other words. It has to do with revenue streams.
Two press releases came in today and demonstrated to me that the biggest problem we have in this world right now is a lack of ethics.
In one a business research group, Info-Tech, is asking us to ban eBay's Skype from corporate system, saying the software is dangerous. In the other, the Electronic Fronter Foundation basically wants us to boycott Sony CDs because they're secretly installing malware disguised as a DRM that keeps people from fairly using what they thought they bought.
What these stories share is an assumption, a very dangerous assumption in an interconnected world.
The assumption is a lack of ethics by all. Sony is treating all its customers like criminals, and acting in a criminal manner in response. Info-Tech is assuming that Skype, along with other "peer to peer technologies" such as "IM," (as noted in their press release) is dangerous and must be outlawed from corporate networks.
We can speculate over why this has happened, but a fish rots from the top. CEOs get the big money because they're responsible. So in the case of Sony Corp., it rots from Howard Stringer. In the case of Skype, it rots from eBay CEO Meg Whitman. If we can't assume good ethics in their products, nothing their employees do matters much.
It's one thing for large institutions to be on guard against consumers or employees, to take precautions against theft. It's quite another for them to take the law into their own hands, or to take on the characters of a police state in response, to assume by their actions that everyone is a thief.
Once that line is crossed, all bets are off and the market becomes a war of all against all.
Microsoft is not a Big Time Brand, as my friend Rob Frankel would say. It doesn't give most of us the warm fuzzies. It's not a trusting relationship. There's no love there, as there is with Apple or Google.
So while I enjoyed Russell Beattie's brilliant summing-up of the strategy, I am far more confident in Om Malik's competitor sum-up. Look at the left side of Om's chart, then look at the right. Is the right side of the chart going to collapse because the left side is tightly integrated?
Remember what's coming, please. Apples are going to be on the Intel platform next year. That means they'll be just as cheap as Dell machines, maybe cheaper, and more stylish to boot. Google dwarfs what Microsoft is doing online, because they know where their business starts (search).
It's good that Microsoft is understanding where their business starts (the desktop) but just putting extensions on that into others' turf isn't monopoly.
The hidden flaw, or Achilles Heel, of scaled technology systems like Amazon, eBay and Google is that the technology replaces human action.
Techdirt's recent story of the angriest eBay seller is just one example. The folks at eBay have always been lax in putting human resources against their computerized auction house, and frankly I won't do business with it as a result. A seller who threatens buyers physically should not be on the system, period.
It's an open secret that eBay is beset by fraud, on both sides of transactions, that Google results can be clickfrauded, that Amazon is robbed by identity thieves. These companies regularly calculate the cost of real police against the perceived benefits from better policing and keep the wallets in the pocket. We all suffer from that.
The danger is that every Web 2.0 start-up I've seen or heard of goes the same route. Computer interactions are replacing human interaction, cutting the costs of transactions. Perhaps we're cutting too deeply.
The problem, technocrats insist, is that people "don't scale." I can only do a certain amount of work each day. Same with you. When it comes to computer work, just put in another server, another T-3 line, and the same software's impact is multiplied.
The sound fried my phone line. More important, it knocked me off the Internet.
The world of the 20th century, I quickly learned, is a world of limited information. I had to watch Hurricane Wilma on TV. I couldn't get any word on my favorite football team (Sheffield Wednesday). My view of the local scene was limited to what my newspaper chose to print.
It took me back to my own life in that century. I gathered information by phone. I entered it on a typewriter. I flashed my eyes across typewritten notes to produce my copy, and I filed the results in real file folders.
I also worked within a functional business model, one I'm still trying to replace.
A lot of people are (rightfully) upset over SBC CEO Ed Whitacre's recent statements dismissing the concept of network neutrality.
Given that SBC will take the AT&T name once its merger with that company is complete it has many fearfully humming the theme from "Empire Strikes Back," seeing the Death Star in the sky again, preparing to see the Internet lights turned off all over the world. (The song is now a favorite of every Enormous State University band, usually played in the Third Quarter as Little Sisters of the Poor are crushed.)
Frankly, Mr. Whitacre is an idiot. There are many reasons why net neutrality, and not paid content access, will triumph in the U.S.:
Google is one of the largest owners of dark fiber in the world. That's what their San Francisco WiFi bid is really all about. They need to fill that fiber, and WiFi can easily render wired phones (and lines) obsolete.
Sprint has some interesting deals going with cable companies that create a "triple play" with cable networks combining phone, mobile, and television service. Network neutrality in that offering could cause millions to switch off their phones.
Level 3 can easily link their fiber backhaul capacity to new providers via WiFi and WiMax, delivering another alternative for consumers.
People aren't stupid. Consumers understand what the concept of network neutrality means. If it's threatened they will demand it from regulators and Congress.
The U.S. is an increasingly small portion of the Internet. Continued slow growth will make the U.S. an economic backwater, and people know that.
A 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.
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.
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.
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).
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.
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.
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?
The 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::
Internet 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?
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. Unless....as 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.
The 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.
I 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.
Back in the 1970s most people who were at the age I'm at now were convinced these "PC" things were going nowhere.
It was left to teenagers -- teenagers -- to lead the world into the future.
Young people are essential to technology because they approach problems without preconceptions. Their new eyes often find solutions where older eyes find nothing but problems.
Take the problem of hit and run drivers. It's a big problem. But there are so many hurdles in the way of a solution -- privacy hurdles, timing hurdles, etc. -- that corporations just haven't tried to do anything.
Well, some kids at York University at Toronto have done something. Cameras and sensors were combined with a mobile phone into a system that snaps the car who hit you, and sends the owner an MMS message immediately.
It's primitive, it's not even a product -- it's a class project -- as Techdirt notes. But it's a prototype, something that can be productized and easily sold at prices car owners will accept.
This is the dirty little secret of science, that most scientists make their breakthroughs at relatively young ages, and then spend the rest of their lives sliding through on their reputations. How old was Einstein when he came up with general relativity? He was in his early 20s. (That is him, at the top of this item, from the Space and Motion Institute.)
Don't just bring in young people. Listen to them, give them autonomy, give them whatever you have to. Just get them.
There are benefits to age. I know about many of them. But there are also benefits to youth. And the best teams know how to mix the two.
The movement of network boundaries ties together all the trends of the present time.
By the network boundary I mean the point where your client, which you control, ends and a network which is beyond your control begins.
Crossing the network boundary requires more than a cost-benefit analysis. It also requires a trust-benefit analysis. You have to trust the network, and the network owner, before you make the jump. (The illustration of the word Trust is from Professor Myoung Lee of the University of Missouri.)
So trust is a vital asset to any company seeking to lure people across the boundary. This is why Google's credibility is so vital, and why CEO Eric Schmidt has to go, because he doesn't understand that and his actions threaten Google's credibility.
The frontier in computing today is the placing of personal data and applications on the other side of the network boundary. GMail represents both data and applications. That's what makes it an important product.
But there are many other appications that could be handled on the other side of the network boundary. All the things we consider desktop applications could be handled on the other side of that boundary. Trust,. or the lack of it, is what keeps those assets on our side of the boundary.
We have known for years there are many benefits in placing our data and applications on the network side of the boundary. Our clients can become simpler, for one thing. Our costs can be reduced, for another thing. Our stuff is more accessible, especially if we build access to it into all our clients.
But there are risks to doing this, trust risks. Government could get into our stuff if it's on the other side of hte boundary. So could private actors -- bosses, competitors, hackers. And then there's the question of how fast and reliable the network connection is, which now separates us from our stuff and our applications.
This is why the U.S. technology lead is threatened by politics today. Our lack of trust in the government keeps us from moving our stuff and our appilications across. And the government's asinine policy on networks -- private unregulated duopolies of cable and phone giants -- means the cost benefits of moving these things across is lower for Americans than for people in other countries, in Asia and Europe.
The speed of networks determines our technical ability to cross the network boundary.
Below is a typical Feedburner RSS ad, which appears in Newsreaders but not on Web pages. We'll discuss it after the flip:
UPDATE: After this was posted, Feedburner vice president-business development Rick Klau wrote the following. It is directly on point (as the lawyers say):
While I can only speak for FeedBurner, we only splice ads into feeds for publishers, on behalf of the publisher. We never splice ads in a feed that the publisher didn't ask for, make money from, or know about, ever. It's the same type of model as web advertising solutions that you use on your site, and you make most of the money.
FeedBurner is a publisher service. We only perform those services on a feed that a publisher wants us to perform, and that goes for everything, whether it's splicing ads, applying a stylesheet, or tracking statistics.
No blog site manager running our service can be unaware that their feeds have ads in them because it is impossible to get ads in your feed at FeedBurner without either directly contacting us or selecting the AdSense for Feeds program and providing us with all the details needed to splice in those ads.
"Correct. eBay paid $2.6 million in cash and stock for a company that had few revenues, no profits, and hardly any business model, and whose operations were completely incompatible with eBay's own."
"I could understand the stock, and even understand the press claims the deal was worth $4.1 billion. It's the cash that gets me."
After $2 billion, Rupert Murdoch's Internet strategy has become clear.
Capture kids.
Murdoch finished off his buying spree by putting $680 million into IGN, which runs Web sites devoted to video games. This followed his earlier purchases of Scout Media, which runs sports sites for various sports teams, and the company that owned Myspace.com, the music fan site.
Murdoch has called a special "summit" of his top corporate chiefs for this weekend at his California ranch. Prince Alwaleed bin Talal’s Kingdom Holding Company of Saudi Arabia has apparently endorsed his strategy. (Didn't know the Saudis had their hooks into Murdoch quite that deeply, did you?)
But what is he going to do? And what can he accomplish?
While Cerf was a fine engineer in his day, his record as an executive leaves a lot to be desired. Those with memories recall that he was with MCI all through the Worldcom disaster. He gave speeches, he took awards, and he had nothing to do with the fraud. He was out of the loop.
He was lipstick on that pig.
Will he be any closer to the loop at Google? Or does this mean Google is about to turn itself into another MCI?
The sad fact is that Google is rapidly becoming a bureaucratized mess. Current CEO Eric Schmidt ignored Blogger, he gave his corporate credibility a padding, he has loaded up on his personal fortune and generally made a hash of those things it was in his power to make a hash of.
Over at ZDNet, Steve Gillmor (left) has a wonderful commentary that got me thinking about a financial disease, one to which corporations like Microsoft are addicted and by which users like us are burdened.
This week's issue of my free weekly newsletter, A-Clue.Com, dealt with journalism. (Subscribe here.)
Specifically, I'm looking at the impact of Google Maps on our business, and how we practice journalism, as well as how we deliver it to readers. (Speaking of which, Google has satellite imagery of New Orleans taken at 10 AM on August 31 available here.)
Talk about shock and awe...)
There's a saying that bloggers are journalists who won't make a five-minute phone call, while journalists are bloggers who won't spend five minutes on Google.
Both views have something to them, although I'd say that Google keeps getting better, while the phone doesn't.
But there's a bigger secret neither side tells you.
The fight has barely begun for control of the new Internet interface, the RSS reader.
NOTE: We were honored to get two important responses to what follows.
Markos Moulitas says he never had an "exclusive" on Cindy Sheehan (I usually reserve the term for the first to get a story, but Sheehan's words have since been on many other blogs) and that there are RSS feeds to Dailykos diaries. (My point is the feeds are separate from the main subscription.)
Nick Bradbury, creator of FeedDemon, wrote to say that FeedDemon inserts no ads in feeds, that those ads are placed by sites. (This may mean the New York Times has a major ad campaign underway, using blogs as delivered by feeds. If you use another reader, let me know if you see Times ads.)
CORRECTION: Upon further investigation, I have learned that the Times ads come from Feedburner.Com, which is in the feed creation-and-management business. So Nick's right.
Please note that the data in parantheses does not question the honesty or truthfulness or veracity of either correspondent's words, but simply describes the responses I gave them, and the thoughts I had in writing this post.
We're always honored here at Mooreslore when newsmakers respond to our posts about them, when they correct what I write or report. Thanks again. We now return you to your regularly-scheduled post.
But already it's getting interesting.
I have written before how publishers have been placing ads in raw RSS feeds. this means my e-mail list of RSS stories is cluttered with "brought to you by" notices. This is on top of the outright advertisements sent as RSS, which if they hit a keyword you like means they're coming right at you.
What's more interesting, perhaps, is what's happening in stand-along RSS readers.
There are many in the market, but the examples here are going to be concerning FeedDemon (logo at left), now owned by Newsgator, which I have been using a few months:
Some advertisers, notably the New York Times, have taken to advertising within these products. I have gotten a steady stream of Times ads in FeedDemon, a reader I paid for. (Before, ads only came in shareware.)
Some site owners, like that of Josh Marshall, have begun truncating their RSS feeds to near-meaninglessless, in order to force users to go from the reader to the site, which then displays in the feeder's window, exposing you to their ads. Full disclsoure demands I mention that Corante is a leader in truncation. If you see Mooreslore through FeedDemon you see just a few lines of content, not enough to know what the story is about.
Other sites, like TPMCafe, meanwhile, publish everything in a feed, but without the paragraphing. Go figure, since TPMCafe and TPM are run by the same people.
Sites that use "diaries," based on Scoop, don't automatically send out RSS on what's in the diaries, only what's on the main site. Dailykos, which at first seemed to have an exclusive on the thoughts of anti-war protestor Cindy Sheehan, may have lost that because of this. (That's speculation on my part, but on a blog you speculate, and if you're wrong someone writes to correct it. Hint, hint.)
He offers a Cachelogic chart showing how p2p services (but more specifically eDonkey) are driving total Internet traffic. In fact, more than half the total Internet traffic monitored by Cachelogic, according to the chart, is eDonkey traffic. (The illustration was copied from Malik's blog, but credit should go to Cachelogic.)
Then Malik makes some really key points (boldfacing is mine):
In the long term, however P2P traffic if not managed properly is going to become a big problem.
The explosion in P2P traffic is going to have an impact on the people who don’t use the P2P services as well.
Due to P2P’s symmetrical nature on average 80% of upstream capacity is consumed by P2P.
If you're of a certain age (anywhere from 35 to about 45) that should send you running screaming from the room. The band made a living off that for years, but by the mid-1990s even the Germans were tired of them.
So Katrina, who was an American Army Brat but has been in England since 1976, went back to the drawing board. She actually had some success, even winning the Eurovision Song Contest for England in 1997, but she wanted back in the pop game.
Every day I find limits in the local Web. Right now, for instance, I need a USB Bluetooth connector for my laptop. It's on the Staple's Web site, but delivery is three days away, and it's not at Staple's. It's on the Best Buy Web site, but it's not at the local Best Buy. I'm going to Fry's tomorrow (a 40-mile roundtrip) and if it's not there I'll have to wait for delivery.
All this driving would not be necessary if local inventories were rourtinely tied to Web sites (as they sometimes are at BestBuy.Com). That's one Local Web application.
Mark Glaser has an OJR piece up about Cook's Illustrated, which has drawn 80,000 paid subscribers.
Glaser credits "cross-promotion and deep research" with the site's financial success.
The truth is simpler, and comes in one word -- credibility. Glaser sums it up this way, "the Consumer Reports of food." (That's publisher Chistopher Kimball, from an appearance on CBS.)
It's an apt description. I pay for Consumer Reports online. I don't use it often, but when I face a big purchase, I get my money out. Because CR is absolutely, 100% credible. There are no ads. There are no conflicts of interest. Everything they do is about earning my trust -- mine, not any vendors -- and they succeed at that.
The recent contretemps over Google's Digital Library plan proves that the essential conflict between copyright and connectivity has not been resolved.
I was chilled by this comment from Karl Auerbach, (right, the cartoon featured on his home page) former ICANN governor and certified "good guy" of Internet governance, to Dave Farber's list:
I've become concerned with how search engine companies are making a buck off of web-based works without letting the authors share in the wealth.
I've looked at my web logs and noticed the intense degree to which search engine companies dredge through my writings - which are explicitly marked as copyrighted and published subject to a clearly articulated license.
The search engine companies take my works and from those they create derivative works.
Oil, like other commodities, is priced based on a contunuous auction, demand measured against supply. (The picture is from a primer on peak oil, courtesy Energybulletin.net.)
Supply has become inelastic. Not just the oil, but its refining. No one is building new refineries (not in this country). When supply gets really tight we actually import gasoline.
The problem is that demand has also become inelastic. I'm talking to you, mister. No one seems willing to make a change, to reduce their demand for oil, gas, and electricity. Back in the 1970s people switched to smaller cars, they didn't drive as much, they even boosted the thermostat. Now, nothing. We get in our SUVs, we take the freeway 40 miles to work and back, we drive all over hell-and-gone for various reasons (kids, shopping, etc.) and we usually leave the A/C on high while we're gone.
It's advertised as a "peer to peer location service" combining "WiFi, cellular and GPS." But what exactly are you supposed to do with it? Where are the applications that will get Navizon's money out, let alone a profit? No clue.
Back in the 1980s, Wall Street played a game on Microsoft's duo of Gates and Ballmer, demanding "grown-up supervision" for the then 20-something computer software duo.
Fortunately, Bill and Steve did not take the hint (get lost). They kept their stock, kept control, isolated a succession of adults, and finally came out the other side, billionaires and still in control to this day.
Well, I think Google has now outgrown its grownup.
Larry Page and Sergey Brin not only founded Google, but set many of its most important standards. They understand Google's corporate direction in their bones. But, like Gates and Ballmer back in the day, they were forced by Wall Street to get "adult supervision" in the form of Dr. Eric Schmidt.
Schmidt is, at heart, a computer scientist, and a good one. He is known as the "Father of Java," for his work on that language while at Sun. Then he went to Novell, and nearly rode the thing into the ground. (This should have been a hint, boys.)
While a straight look at technology and the desires of consumers could lead you to these conclusions, they're dumber than dirt.
Let's start with the first one.
Even if people start leaving their laptops at home, laptop sales are not threatened by mobile phones, because laptops are replacing desktops. It's basic ergonomics. Where does your lap go when you stand up? If you're standing, or walking, you can't use a laptop, you have to use some sort of handheld device. As PDA functionality moves into phones, as the two markets merge, then, yes, phones become the handheld of choice. But that doesn't mean they replace laptops. It means they replace PDAs.
Sam Walton was devoted, first and foremost, to his employees. (That's the cover of his autobiography at right.)
He was famous for driving around the country, arriving unannounced at stores, leading employees in cheers. It was almost Japanese.
People forget today, but Wal-Mart salaries in its early days represented big raises for rural people who otherwise faced lives of poverty, absent the small luxuries city folk took for granted. Thanks to Sam Walton, Wal-Mart employees could afford to shop at Wal-Mart. He transformed America from a land of rich city-poor country to one of middle class uniformity, and if you once lived on the poorer side of that divide it made him a great man.
Henry Ford was the same way. His River Rouge plant didn't just turn out a low-cost car (the Model T) . It turned out well-paid workers who could buy those cars. Ford, too, revolutionized America, making this a nation on-the-move.
My point today is that, in both cases, there were side-effects, which demanded renewal and change. And the refusal to change just delayed these crises -- it didn't prevent them.
The big trend of this decade, in technology, is a move toward openness.
It started with open frequencies like 802.11. It then moved into software, with open source operating systems and applications. Now we have open source business models. The ball keeps rolling along.
Open source has proven superior in all these areas due to simple math. The more people working a problem, the better. No single organization can out-do the multitudes.
But this simple, and rather elegant, fact, is at odds with all political trends.
I believe that one of the cruelest businesses of our time are the so-called "payday loan" folks.
You see these shops in every ghetto. Victims write checks that are due to be made good when they get paid. The interest rates on these things can be as high as 100%.
Banks think that, at this rate, it's good business.
Now the business has come online through a San Diego outfit called Spotya.
I'm a big fan of both Marc Canter (right) and Joi Ito . (NOTE: The picture, by Dan Farber of News.Com (and ZDNet fame), was taken off Marc's blog.)
They're both brilliant. They're both A-list bloggers. They're both rich. I've known both for about two decades.
But I think Marc has a vital Clue Joi has missed, about one of the most important trends of our time, the rise of the open source business process.
Here's why I think that.
Joi has put a lot of money into SixApart, which runs Movable Type, which powers this blog. It's good stuff. But it's being left behind because it is, at heart, proprietary. It doesn't interconnect with other software. It isn't modular, scalable, and it can only be improved by the SixApart team.
In other words, it doesn't take advantage of the open source business process, and thus there are whole new worlds it hasn't been able to scale into. It's not a Community Network Service (like Drupal), and it's not a social networking system (like MySpace).
Marc, on the other hand, has just released GoingOn. It's a new engine for digital communities, like MySpace. He launched with Tony Perkins, who will use the system as the new heart of his AlwaysOn network (no relation to my wireless network application idea of the same title).
Marc calls GoingOn an Identity Hub, something to which other identity systems can connect. (It's interoperable with Sxip Networks, for instance.)
But Marc also understands that his stuff can't be the be-all and end-all. Let him explain it:
He's right because there's already some Web content people do pay for. Dow Jones loses reach and influence, but does make money selling online subscriptions. Lexis-Nexis and Dialog haven't gone free with the dawn of the Web. Last time I checked iTunes was selling songs online, at a profit.
He's wrong because he insists that "micro-payment technology" will stimulate the growth of pay-for-play content. We've been hearing that one for 10 years now, and it's as wrong now as it was in 1995.
There's already a micro-payment program in place. A very successful one.
Fox has never had an Internet strategy. This was partly because Murdoch wouldn't pay top dollar for Internet assets. But it was also because he has kept his Internet operations on a short leash.
By spending big to get MySpace, which has taken over the business of social networking around music in the last year, Murdoch is changing his tune.
But it doesn't matter unless DeWolfe, who launched MySpace just two years ago with Tom Anderson, has a second strategic act in him.
Conservatives have long complained the press is biased against them. Lately liberals have taken up the same cry.
Now technologists have the right to call out the media as well. When an organization that claims to be totally dedicated to the search for objective truth, like the Associated Press, starts slipping bias into its tech coverage, watch out.
But the headline? Piracy tool turns legit. And the text was no better. " The Opera Web browser will soon support a file-transfer tool commonly associated with online movie piracy."
Excuse me, AP, but bull-cookies. BitTorrent is not Kazaa. It's a technology. There's no business there. Blaming BitTorrent for piracy is like blaming FTP or SMTP or even HTTP for piracy, because you can move copyrighted files. You can move copyrighted content across all Internet protocols. They are value-neutral. And the head of Opera even told you why he did this -- because it enabled the rapid distribution of Opera itself and Opera wanted such a capability widely-available.
For people who like gaming, their games (or online environments) are their main interface to the Web. This has been true for some time, and unremarked upon.
There are other new interfaces that many people depend upon. The iTunes player can be an interface, when linked to Apple's Music Store. Any music player, or multimedia player, is a separate Web interface, which may or may not connect to a Web page at any time. People who swap files use those programs as interfaces.
The point is in many niches the Web browser has already been replaced as the main interface to the Internet. Microsoft's five-year campaign to dislodge Netscape was worthless, which may be why they're letting Firefox run off with so much market share.
And now, even readers are getting their own, separate interface, the RSS reader.
I use FeedDemon. Steve Stroh uses NetNewsWire on his Mac and calls it fabulous. This field has yet to shake out.
I have noticed some big differences occur in my work when I'm using FeedDemon instead of the browser as my interface to the Web:
I'm seeing more content, faster.
I'm seeing fewer ads.
I'm finding great differences among sources in how they react to readers. Some post just a few sentences to the reader, others let the whole article run. The latter sites are seeing far fewer "hits" on their pages than the former, thus far fewer page-views overall, and far-fewer ad reads.
Publishers are waking up to this by shortening, even eliminating, the text that goes into the "newspaper" format of feedreaders. The Wall Street Journal is especially aggressive in this. US News is especially lenient.
You may have great merchandise, you may have great service, you may have a nifty shopping cart. But if you can't bring the values of your shop floor to your Web site, you won't succeed online. Over time you may not succeed offline either.
An editorial mission replicates the value of your store online. What is your Unique Selling Proposition (USP)? For Amazon it's a database, a huge variety of merchandise. Works for Amazon, works for Wal-Mart, but it won't work for you.
In fact, Wal-Mart's failures online can be attributed to this editorial mission failure. They were unable to replicate the values of a real Wal-Mart in their online efforts. While the store looks a jumble, regular shoppers know you can actually get what you want there fairly quickly. What they should have enabled was a form of "shopping lists" that people could print-and-use at home, adapting to their own needs, then input regularly on the site, along with a delivery service.
The difference between editorial values and commercial values is that the one defines what you are, and the other puts your name in mind. If branding is to be worthwhile you must deliver the values the brand promises. That is exactly how editors think, too. What you call your reputation they call credibility.
NOTE: That's the royal crown magnolia from mytho-fleurs.com. Like it? It's yours.
A long evening spent reading Lasica's book brought the title to me: King of Irony.
Remember, this is a book. Thus it is subject both to a book's business model and its rights regime.
Want a copy? $25.95 plus tax and (if you buy it online) shipping get it for you. Or wait for it to appear at your local library. Or borrow one from a friend, free. Or wait some months for it to appear in a discount bin, or a remainder lot, or a garage sale. The price you pay is a function is a function of the time you're willing to wait for it.
What can you do with this book? I typed an excerpt today by hand. The length of the excerpt, again, is a function of time, and the cost of my time to produce it, unless I want to string it out a page or two. In that case, technology might be deployed -- a scanner -- plus a few minutes with the scanner's OCR software, some cutting-and-pasting, and voila!
Want to steal some more? Production costs are going to get you. A Xerography process may give you a bound book for just a few dollars, if your order is small. An offset process costs less per book, but the order in that case must be bigger. I guarantee the printer will want to know you're a Wiley fella (or lady) before they take the order.
And we haven't even cracked the cover yet. Easy to see where Lasica's crown comes from.
It's nice when "real" (paid) market analysts agree with one of your premises. Especially when it's a key premise to you, as Always On is to me. (This is advertised as an Always On Server, from Virtual Access.)
M2M stands for Machine to Machine (ironically this sits right below an item about how poor most tech nicknames are) but we're talking about the same thing, intelligent sensors linked to wireless networks. Programming the sensors to deliver some result, then automating delivery of the result in some way (sending an alarm, telling the user, etc.) is what I mean by an Always-On application.
As I have said here many times the tools are already at hand, and cheap. We're talking here about RFID chips, WiFi and cellular networks, along with standards like Zigbee that let these things run for years on a single battery charge.
There are problems with every application space, however:
If Intel is the big dog of the chip world, AMD is the little dog jumping around it, nipping at its heels, acting like it (not Chipzilla) owns the street.
This Administration does not look kindly at anti-trust claims. They settled with Microsoft, they gave the cables and Bells a duopoly (leaving America a third-world broadband country), and they seem content to let China monopolize world trade while India gains control of services. All this is in pursuit of an ideology that becomes less-and-less distinguishable from Putinism and Kleptocracy by the day.
Short form. If they had a case they should have filed it in Europe.
By a 9-0 count the Supreme Court has held that Grokster (and its ilk) can be sued.
The decision was written by David Souter (right, in an old picture from Wikipedia), a conservative-turned-liberal appointed by the first President Bush.
Here's the key bit:
"We hold that one who distributes a device with the object of promoting its use to infringe copyright, as shown by the clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties."
I've highlighted the most relevant portion. To me it looks like they wouldn't hold against BitTorrent, but that Grokster's business model, which did sell the service as a way to infringe, crossed a legal line.
As written I find it hard to argue against the language, but I guarantee I'll disagree with the interpretation, especially the spin being placed on this by the copyright industries.
As I see it the decision puts a limit on the "non-infringing uses" language of the Betamax decision, but does not overturn it. Grokster falls because its business model is based on infringement. BitTorrent has no business model, and thus may be exempt.
Trouble is that is an assertion that will be tested in courts that will twist this result just as the DMCA was twisted to reach this decision. Congress was told by the Copyright industries in 1998 that the DMCA would not overturn Betamax, that it would protect fair use, that it would not be extended in that direction and should not be interpreted as going there.
With this decision -- a unanimous decision as opposed to the 6-3 Betamax ruling -- I guarantee you the industry's lawyers will try and turn this into open season on the Internet.
I spent last week in Texas, dependent on free WiFi hotspots, and I learned a powerful lesson.
There is no such thing as free WiFi.
When "free" WiFi is provided by a bar, coffee shop or restaurant, there is a quid pro quo. You're going to eat. You're going to drink. And when you're no longer eating and/or drinking (and ordering) you're going to get nasty looks until you leave.
There is a cost to a shop's WiFi that goes beyond the cost of the set-up. That is the cost of the real estate, the cost of the table, and the cost to a shop's ambience when a bunch of hosers come in and spend all day staring at laptops.
Former RIAA president Hilary Rosen finally gets it about copyright.
This volume needs to be embraced and managed becasue it cannot be vanquished. And a tone must be set that allows future innovation to stimulate negotiation and not just confrontation.
Her column at the Huffington Post (she apparently chose not to take feedback on it) is filled with honesty about both the tech and copyright industries, honesty she never admitted to (in my memory) while shilling for the RIAA.
But is it possible that this honesty is what finally caused her to leave? (Or did her life, and its imperatives for action, take precedence?)
That would be a shame, because the fact is, as she writes, that the answers here must lie in the market, not the law courts. For every step the copyright industries take in court, technologists take two steps away from them. This will continue until the copyright industries really engage consumers with offerings that are worth what they charge, and which aren't burdened with DRMs that restrict fair use.
We returned to the topic of e-commerce, and the effort to make money in journalism, with this week's A-Clue.Com, which went out to subscribers this morning. (You can get one too -- always free.)
The topic this week might be called the new media's old media problem, with a proposal for solving it. (I have no idea whether the book here is good or not. If someone can send me a link to sales, we'll see.)
Enjoy.
In software terms blogging and commerce are incompatible. They're two trains running on different tracks.
Bloggers aren't really thinking of making money. They may put up begging bowls, and they make take BlogAds, or put in Google AdSense, but their Achilles Heel is that, when they think of money at all, it's in Old Media terms.
Let's sell ads.
Community Networking Systems like Scoop, Slash and Drupal also share this problem. They have an advantage over blogging systems in that they can scale. They can take a lot of traffic, and a lot of users. Those users are empowered to create their own diaries, or polls, or multi-threaded comments. But again commerce is secondary, in this case even tertiary. The most successful "commercial" community sites are those, like DailyKos and Slashdot, that direct people off-site to give money or time to important causes. There is no built-in business model.
The only unfortunate thing here is that the writers of the release on this interesting report call the area eHealth.
My problem is not with their intent. A rose by any other name and all that. My problem is that the term eHealth is stifling, limiting. It minimizes what is actually happening, and isolates wireless network applications to one small field.
The story is about how some coffee houses are turning off the WiFi because they don't like the fact that their shops become offices. People shut up around WiFi. They bring in their PCs, turn on, and tune out the world around them. They may buy a coffee (increasingly they don't) but that's all you're going to get out of them.
Coffee shops and restaurants have beren the leaders in the WiFi "hotspot" movement based on the assumption they will be good for business, that people who WiFi also eat and drink.
Turns out we don't. Not that much, anyway. And we don't leave the table, either.
All of which leaves these shops without a valid business model. Would those using free WiFi object too much if they grabbed a piece of your browser's real estate and forced ads on you while you worked? How about if they put in a WiFi tip jar? I'm open to suggestions here.
Chris Anderson's blog, The Long Tail , is a "public diary on the way to a book" about the economic impact of mass customization.
As the graph shows, the phenomenon is familiar to anyone who blogs, and the challenge is to find a way to profit from it.
Stuff on the left side of the curve has business models. Stuff in the middle is struggling for a business model. Stuff on the right has no business model.
As you can see by looking at the endorsements on the left side of Anderson's blog, the Digirati are reacting like Anderson just discovered fire. And the Long Tail is no less obvious.
What's non-trivial is finding a way to profit from these atomized markets.
Google does it. TiVo does it (sometimes). But must those who profit from the "market of one" all be scaled? What about the creators? And what are the consequences of that?
What we've seen in the market, since the rise of the Internet, is an increasingly-shorter tail. Middle market books don't sell. Independent movies are having more trouble getting produced, not less. Musicians who used to live decent lives on record company contracts find today they can't get a sniff.
I've been a professional writer for over 25 years now. And what is most striking about the last few years, besides the rise of open source and blogging, is the rise of forced amateurism.
He's not alone. Far from it, in fact. Three years into a supposed tech recovery and most of the offers I'm getting, still, are for "exposure" or "contacts," not dollars. Even those publishers who do profess to pay something, such as Newsfactor, in fact pay very little. Professional tech journalism, the field I've been part of for 20 years, is circling the drain.
The same is increasingly true of professional software development. The rise of open source disguises a disquieting fact. Many programmers today can't get work, and salaries are down. Most commentary is to the effect that programmers should "get over it." No wonder fewer want to be in the profession. I notice that CEO and sales pay rates in that industry aren't falling.
The fact is that trends designed to liberate this business, so far, are succeeding only in impoverishing the people in it. I've said this before, but the problem here is one of business models.
One of the most interesting ideas I heard at the recent Blognashville event was Glenn Reynolds' suggestion of "local blogs." (The image is from Notbored.)
I looked into it. Won't work.
Local blogs don't scale, except in a small number of instances, in localities that are in fact quite large. You can, in theory, have New York blogs, covering the whole city, but how local are we talking about?
There's not enough of an audience for a single local blogger to cover, say, school board meetings, or crime, or even business, and bring in any money at all.
The answer to scale is comprehension. But that brings its own problems.
I'm generally all in favor of anything to fight spam. And regular readers of this space will recall how much I like my own anti-spam tool, Mailwasher from FireTrust.
But this pissed me off.
UPDATE: After posting this I learned the spam database I'm about to describe is not necessary for Mailwasher to work. My complaint here is solely regarding issues of marketing and notice. Mailwasher remains my anti-spam solution of choice.
The latest version of the product, Version 5.0 to be precise, supports a company spam datebase, called FirstAlert! This is a commendable thing, on balance.
But in order to pay for maintaining this database, FireTrust has changed its business model. This is not necessarily a bad thing. Essentially they're going to a subscription model built around FirstAlert!
I was asked to download the "upgrade" to Mailwasher, by FireTrust, roughly a week ago. I did so. It's now a $37 product but, if you want to maintain your own POP3 mailbox and a public e-mail address, it's a necessity. Upgrading was transparent, easy-peasy.
Suddenly this morning I get a pop-up, inside Mailwasher, reading "your subscription to FirstAlert has expired," with a link to renew. The link goes to a page inside the FireTrust site, and they want $9.95 for the subscription. The page doesn't indicate how long this "subscription" lasts.
Because of the way in which this was done, it can look to a consumer like a classic bait-and-switch. I bought this thing just last week and now you want MORE money?
Fortunately it's very easy for FireTrust to fix this:
You may remember him. Long-haired weirdo. Crazy hair. Counter-cultural kind of guy.
Some 30 years ago he and another friend named Steve hung around with the losers at something called the Homebrew Computer Club.
They had this neat idea for a new kind of box, using a TV, tape recorder, and typewriter as interfaces for a self-contained computer. One of them (I think it was the other Steve) shopped the idea to Hewlett-Packard.
Well, you do have to listen to your elders, after all. I'm sure that discouraged Steve. Probably discouraged everyone else around him. Their thing never saw the light of day, as I recall.
I have been criticized soundly here by the early leaders of the blogging business community,(Pictured is one of these leaders, Jason Calacanis. From Vertikal.Dk.)
And why should these people listen? They have what they consider success. I'm a "low traffic blog." If I'm so clever I should be doing it, not talking about it, right? (Right.)
But the plain fact is, most of today's top blogs are using the wrong business model.
Their model is a media model. I tell you, you listen, and maybe I advertise to you on the side. This is what newspapers do, what magazines do, what radio does, what TV does.
But is the Internet a newspaper? Is it radio or a magazine or TV? No, it is not. The IN in the word Internet is short for Intimate. So why then should a business model imported from one of these other industries be appropriate? Only because, like TV entrepreneurs in the late 1940s, you can't think of a more appropriate one. You don't have the right vocabulary. You weren't born to this medium.
What would work better?
The community business model would work better. This is driven, not so much by what bloggers want to say as what their readers want to say. There are many high-traffic sites now using the community model -- Slashdot, Plastic, Groklaw, DailyKos. What they have in common is true community software -- Scoop, Slash, even Drupal.
The problem (and this is the nut of the issue) is that most of these community sites have deliberately shied away from having a business model. The only site I mentioned above that has a true business model is Slashdot, and Slashdot is so unusual people with an editorial background can't get their arms around what that business model is.
Good news (at least in the short term) for file hoarders.
Given that both sides in the Copyright Wars know about language and framing, I'm urging use of this new term for the heavy hobbyist users on peer to peer networks.
Pirates (the copyright industries' term) is false. There is no economic motive behind most file trades. There is no assurance that, if trading ended tomorrow, sales would rise appreciably.
Traders (the term favored by users) isn't correct either. Most traders are asymmetric. Most are downloaders, not uploaders.
I think the word hoarding says more about the motives of the users, and the way toward ending the practice, than anything else. Thanks in part to the industry's rhetoric, and in part to its actions, many lovers of music and other files are afraid they will lose access to the culture they crave. Thus they demand to have physical copies of its artifacts, and grab all they can. It's classic hoarding behavior.
But time is the limit here, not space. You can only listen to one song at a time, watch one movie at a time. It doesn't matter how big your collection is, the only way to get enjoyment out of it is to play the files.
Many hoarders today already "own" more files than they can play in their remaining lifetimes. When you get your arms around this concept, you begin to see how self-defeating hoarding is.
This week I continued the discussion, asking why so many responded to that piece denying they had any such thing as A Clue, let alone A-Clue.Com.
Enjoy.
There was an interesting reaction to my piece last week, denial.
Many of the leaders in the blogging business read it, and all of them denied its inherent truth, namely that they had A Clue.
I'm not a business, insisted Jason Calacanis. Never mind that he has 65 blogs, a uniform look-and-feel, that his writers don't even get their pictures on their blogs and, when they leave, they leave with nothing. No, it's all about passion, he insists. We do this for love, he says. Business? We're not building one of those.
Despite his ponytail and his sometimes counter-cultural language, despite being what I like to call a Truly Handsome Man (it's a brighter term for bald, people) Ted Waitt was always a follower, not a leader. (The picture is from a 2002 profile in the Sioux Falls, South Dakota Argus-Leader.)
Waitt was Gimbel's to Michael Dell's Macy's. He wanted to be Pepsi to Dell's Coke.
But computing lacks the stability of the retailing or the soda business. So when Waitt announced his resignation today (at 42 it wouldn't sound right to call it a retirement) it wasn't big news.
Waitt and Gateway did well in the 1990s, following Dell into mass customization. He made his big mistake when he tried to out-think Dell, opening a chain of retail stores that caused $2.4 billion in losses, according to The New York Times.
But I personally think the mistake was more basic than that.
B.L. Ochman (the picture is from her Whatsnextblog) has already broken this, but this week's a-clue.com newsletter features a piece on blogging business models, written following the Blognashville conference.
Enjoy.
I spent the weekend at Blognashville, a gab-and-egofest for about 100 (mostly male, mostly middle-aged) bloggers at Belmont University in Nashville (a pricey pimple on the bottom of Vanderbilt) to fuss over Glenn Reynolds (much nicer in person than online) and to search for meaning.
The big question: how will we make money off this?
People are investing a ton of time and effort in blogging. Volunteers get burned out if they can't find money. All institutions are built on money. At Nashville we all felt we were in the gold fields and no one seemed to have made a strike.
There's a Clue there. Nearly all those 49'ers (and Alaska 98'ers) who went in with pick and shovel failed. It was those who went in with a business model, professional mining companies or merchants such as Levi Strauss, who succeeded.
Some 99% of blogs (including mine) go about the publishing question backwards. That is, we look at the process from the writer's point of view, not the reader's. This is forgivable in that bloggers are writers, but this is one of the key differences between writers and publishers. Publishers create for the market.
That is, publishers define the readers they want, the content those readers need, and the advertisers they will hit-up to pay the bills. They then order the production of the product, and keep an eye out to make sure it meets the readers' requirements.
In other words, the difference between blogging and journalism lies entirely on the business side of the shop. Publishers are just as likely to pay for lies as bloggers are to make stuff up. The difference is the publishers create lies that appeal to their audiences, while bloggers write lies that appeal to themselves.
This is easy to understand when you look at the professional blogs that are run by publishers - Weblogsinc, Gawker Media, and Paid Content. Jason Calacanis, Nick Denton and Rafat Ali defined the readers they wanted, created a business model, then hired writers to fulfill the mission.
In contrast I found, at blognashville, that even the most-popular bloggers are mere dilletantes. This is a term Glenn Reynolds applied to himself. Dave Winer, with whom I spent pleasant hours, is also doing his blog on-the-side - his business is RSS. I was surprised to find myself the most knowledgeable businessperson in the room, and I'm a complete failure.
When you're led by amateurs you can't expect professional standards to be upheld. Yet, on the editorial side, blogs often do just that. It's on the business side where they all fall down.
Still, I saw several potential business models at the conference:
Many think the secret of Fox' dominance of news is political. A generation brought up on the myth that an objective press is biased to the left, then given a right-wing Pravda, sees the latter as "fair and balanced."
That's a small part of the story. Identifying a niche and serving it is as old as the magazine business. Older. It's as old as Poor Richard's Almanack.
The real secret is much simpler. The "network" is actually a studio. Few bureaus, no big investigation team, no bench, little support. Who needs writers when most hosts can wing it. It's talking heads. It's radio economics.
The real difference between blogging and journalism is on the business side, not the creative. (That's Henry Copeland of Blogads on the left of the picture, taken last year from Dan Bricklin's blog.)
On the creative side, blogs are just as likely to care about journalism, public service, and lies as any other media.
On the business side, however, nearly all bloggers do things backwards.
That is, we look at the content from the writer's point of view. Journalism looks at all content from the reader's point of view.
This is no small point. You can see it clearly in examining the "blog journalism" companies which have found success -- Weblogsinc, Gawker Media, and Paid Content. Jason Calacanis, Nick Denton and Rafat Ali all defined the readers they wanted, created a business model, then hired writers to fulfill the mission.
As of today Intel's new direction is better. Better doesn't always mean more. In the case of microprocessors it can mean putting more computers on each chip (multi-core) or running with lower power. In terms of communications it can mean a host of attributes, from security to coverage to throughput.
The strength of an economy, like that of a society, depends on social mobility. That means the poor can rise to wealth. It also means the wealthy can end up poor. (This old cartoon, from what folks like to call THE Ohio State University, pre-dates Wal-Mart by generations.)
A recent online conversation with Vijay Gill brought this home to me. The topic was actually our recent piece on The Myth of Scarcity. I liked it, posted it to Dave Farber's list, and Vijay responded quite thoughtfully, his point being that telecommunications is hard, some parts are scarce, and real technical knowledge is even scarcer. Maintaining total connectivity in the last mile without protecting the monopoly is harder than I make it sound.
Why is it that politicians have done a better job on the Internet than publishers?
It has to do with a concept I call Pitch Credibility.
Journalists understand the concept of credibility. It's the trust readers place in us. If there is a journalism profession, it's based on this idea of credibility. I took a huge hit to my own credibility when I screwed-up an item on Ev Williams. I went through hell on that not to regain my credibility, but to minimize the losses, and in hope the damage would not spread to innocent Corante authors.
But just as editorial work must have credibility, so must advertising. That is the innovation the Internet makes necessary.
Moveon.org understood this right away. It knew that if it suggested you give to Candidate X, then Candidate X better fit the desires of the Moveon audience, or the endorsement would damage Moveon. Because it had pitch credibility with its audience, Moveon was able to gain honest information (a mailing list) from its members, and even financial support, based solely on its promise to deliver.
While Moveon failed in these last two cycles as a political force (ask Presidents Gore, Dean and Kerry) it has succeeded in creating a business model that everyone else on the Internet needs to pay attention to.
So if Roger Simon, for instance, is to succeed in his efforts to unite the right-wing blogosphere and extract money from its members, he must retain pitch credibility. He better not let anyone like me in because I'd damage it. And he better use that credibility only to solicit for products, services and people the audience will surely endorse.
Perhaps you can see now why this idea is easier for a politician to understand than a businessman. Politicians are attached to what they're selling in ways businessmen aren't.
Belief is at the heart of pitch credibility.
How can we take advantage of this in the business realm?
The Associated Press was created by publishers to let papers share stories and reduce editorial costs, in an age where everyone knew their business model and barriers to entry were rising.
Today barriers to entry are at rock-bottom and valid business models are hard to come by.
So naturally, everyone's trying to create an AP.
This is going about things backward. Business models aren't for sharing. They must first be created by entrepreneurs, then expanded upon. Only once they're established can you expect the kind of consolidation an AP represents.
What we have, then, is a business opportunity. What is that opportunity?
A shared registration database would be a good place to start. One sign-in, and one cookie, might get a reader posting privileges at hundreds of sites. The database would provide advertisers with a working profile of the readers (demographics and psychographics) justifying a higher cost per thousand on ads. Blogs on the network could be bundled based on politics, subject matter, or geography, just as is done in the magazine business.
The result would be a brand offering the services of an ad network. It should also be able to aggregate other business opportunities for the members of the network, so it would have aspects of a talent agency as well.
How close are we to something like that? Not very close at all:
It's true. There are three kinds of lies -- lies, damned lies and statistics. (The picture is that of a statue of dramatist Friedrich Schiller, in Kaliningrad, Russia.)
Market research companies specialize in the third kind of lie, namely statistics. While these companies were originally created to help clients deal coherently with the market, that's no longer the sole source of income.
The process of market research has been corrupted by paid research done on behalf of:
corporations
trade groups
politicians
political interests
Yes, the categories do overlap. More, and what to do about all this, after the break.
I have not written much about Voice Over IP in this space because I'm not an expert in it. (Yes, I hear you say, this never stopped you before.)
Actually I didn't think I had anything original to add to the conversation. I still don't. But I want to point you to someone who does.
That someone is Tom Evslin (left). Evslin recently completed a wonderful series on the economics, politics, past and future of VOIP, on his blog, which I heartily recommend to anyone interested in this area.
Evslin calls this year a "flipping point" driven bythe mass distribution of VOIP software. It's not really free although, once you have your set-up, each call carries no incremental cost. The market battle between Skype and Vonage are driven by Metcalfe's Law, control of end points. Evslin offers the best explanation I've yet seen of Skype and its business model, which is rapidly evolving into an alternative phone network.
The secret to being a successful entrepreneur is learning how to handle NO.
(I don't know where this image originated. It appears to be an old poster of actor-author Dom DeLuise.)
I learned this lesson from an entrepreneurial friend of mine today, and it's so important I had to blog it.
Entrepreneurs bring ideas to businesses and people. They sell these ideas, as businesses. They take a lot of meetings. And most of the time, maybe over 99% of the time, the answer at the end of the day is No.
"You have to turn it into an opportunity," my friend said. You do that by finding someone else -- a money source, another business -- who will either run with your idea, finance your idea, or buy it outright.
And you keep moving.
The difference between entrepreneurs and other businesspeople is that most businesspeople are in the yes business. In a going concern you mostly hear yes. People do come in the door, people are satisfied, you do create systems that wind up giving value for money. If you're not doing this, you're out of business quickly.
Entrepreneurs, on the other hand, are constantly being told no. It's only when they get the yes that they have the chance to build that business they were describing, and this is usually the end of a long, long process. Yet the businesses an entrepreneur launches are often much better than those run by businesspeople, because they've been tested, vetted, and designed to grow fast.
Personally I don’t think this is necessarily the case. Newspaper companies will be able to use computers and on-demand pagination to mass produce paper products that are relevant to future audiences. Just as radio and TV only forced the industry to change, not disappear, so it will be in this case.
But let’s assume Murdoch is right. How can incumbent newspaper companies achieve anything on the new medium? His speech read like someone anxious to learn. I'll take him at his word.
The best way to understand the future is to look into how chips are changing.
Two transitions are transforming Moore's Law. The original article, in 1964, described only the density of circuits on silicon substrate.
The rule implied that chips could get better-and-better, faster-and-faster. Doubling bigger numbers means bigger incremental changes in the same time. Over the years chemists and electrical engineers learned to apply this exponential improvement concept to fiber cables, to magnetic storage, to optical storage, even to radios, so that 802.11n radios will transmit data at over 100 Mbps -- twice what earlier 802.11g models could deliver, but still 50 Mbps more.
The transitions have to do with what we mean by better.
The success of Google has been based on the fact that technology drives its train. Technical success is the most-sought value.
This is becoming a problem.
In many of the new businesses Google has launched, technical values (while important) are not going to be the sole drivers of success. In blogging, in RSS, in Google News, in Google Desktop, in Google Local, and in other areas, other skills are required.
Business skills. Marketing schools. Journalism skills. Political skills. Artistic skills.
Leonardo DaVinci (celebrated above) could not get a job at Google today. In a well-rounded company, his genius would find a place.
The need for these various skills will only increase with time. Google must find a way to recruit these skills, and to reward these skills, without giving the people with these skills control of the company.
Don't go to journalism school. You can learn to write anywhere. The way to write better is to practice. If you love writing you can pick up the rest on-the-fly.
Instead, go to business school. Why? Because the only way you're going to have a good career in this business is to have the skills of a publisher. And those are the skills taught in business school.
In my first lecture at Northwestern's Medill School of Journalism, in 1977, we were told firmly that if you wanted to make a good living there was a fine businesss school on campus, the Kellogg School, and we should go there. So I've got their logo at the top of this item. I should have taken the advice.
More on why you should go to business school to learn journalism after the break.
The key benefit of open source is transparency. (That's a transparent Mozambique garnet, from CLDJewelry in Tucson, Arizona. Transparency doesn't have to be perfect to be beautiful.)
The key benefit is not that the software is free. It's not that you can edit it. It has nothing to do with the obligations of the General Public License. It's inherent in every open source license out there.
The key advantage of open source is you can see the code. You can see how it works. You can take it apart. You can fix it. You can improve it. Most people do none of these things, but all benefit from this transparency.
The benefit became clear when I got responses to a ZDNet post called Is Linux Becoming Windows? The news hook was a Peter Galli story about how some folks were getting upset over the feature bloat now taking place in the Linux 2.6 kernel.
Those who responded said simply that the complainents, and I, had lost our minds. Kernel features aren't mandatory. Just because something is supported doesn't mean you have to do it. You can pick and choose among features, because you can see the whole code base -- it's transparent. You can look at the various builds out there and, if there's something you don't like, something you can do better, you can fork it, and maintain your own enhanced code base.
When Microsoft changes its software it makes things incompatible. When Linux software changes this doesn't happen, because the change is transparent. New builds are transparent, and if you come to a fork in your operating system road you can take it.
Transparency is the key term. And it doesn't just apply to software:
Last month Intel's mobility chief Sean Maloney was in the hunt to head H-P, a job that eventually went to Mark Hurd of NCR. (Watch out. Dana is about to criticize a fellow Truly Handsome Man.)
But how well is Maloney doing his current job?
Intel's role in the development of Always On is crucial, and its strategy today seems muddled. It's not just its support for two different WiMax standards, and its delay in delivering fixed backhaul silicon while it prepares truly mobile solutions.
I'm more concerned with Maloney's failure to articulate a near-and-medium-term wireless platform story, one that tells vendors what they should sell today that will be useful tomorrow.
Intel seems more interested in desktops and today's applications than it is in the wireless networking platform and tomorrow's applications.
One problem journalists have with blogging is it does away with gatekeepers.
Printers are gatekeepers. They cost money and make you think before you publish.
Editors are gatekeepers. That's their job. They assign stories and edit them carefully so you don't mispel words.
Publishers are also gatekeepers. Traditionally their role has been to shield the poor, innocent journalist from the nasty world of business.
Mark Glaser of OJR examined this today without reaching any conclusions (as good journalists are taught to do). (The recent picture of Nick Denton is from the OJR story.)
Glaser interviewed three people whose blogging companies seem to be bringing in bucks -- Denton (of Gawker, Wonkette, etc.), Jason Calacanis (of Weblogsinc) , and Rafat Ali (of Paid Content) -- about how they pay people who work for them.
By the month, said Calacanis. By the story, said Ali. By the reader, said Denton.
Shock! Shock and dismay, responded the folks at Slate and Salon, representing the traditional industry.
Long story short I thought it would help if I described what might be a better plan for citywide WiFi. Apologies to those of you who have read this before.
The short answer is WiMax. The long version follows the break.
There is a tyranny to having a narrow beat. (The image, by the way, is from the Oak Ridge National Lab.)
Yes, you can develop sources. Yes, you can develop expertise. But with a narrow beat you're limiting yourself, and you're becoming increasingly dependent on your employer, since beat knowledge is often non-transferrable. You're also more likely to "go native" with a beat, internalizing sources' views as your own without analyzing them.
Blogging and RSS are, at their heart, designed to let us do away with this Tyranny of the Beat. Your subject can be read based on its subject matter, or you can develop your own personal fan club.
I have always resisted having a narrow beat in my work. You'll see stories here ranging from Internet Commerce to Always On to law, science, even politics, along with what Hylton thought was my beat when he took me on -- semiconductors.
I think this keeps me fresh. It keeps me interested. That keeps the quality high.
But that's not the way publishers look at things, even blogging publishers. There are now several companies that run a stable of blogs, besides Corante, and each one places writers in narrowly-defined beats. Weblogsinc may be the most aggressive in de-personalizing their blogs. They now have 75. Most can change out the staff in a nano-second and keep going. Good for them, bad for writers.
And weren't blogs created so we'd have something that was good for writers?
A look at the Technorati Top 100 offers a good illustration on the rise of these corporate blogs.
Like Kremlinologists of the past, people are now analyzing Google's every move the way they once followed Microsoft.
Exhibit A today is a piece from Jim Hedger on Google's latest patent application. But the same things can be found any day of the week. Just enter the word Google at Google News and here's what you'll come up with today:
I've seen the TV ads and maybe you have, too. "Get a free ringtone. Simply text (whatever) and get (name of hit song) as a ringtone!"
Well, it's a scam. It's not free. In fact, writes Stephen Lawson for The Industry Standard, it's a lot more costly than a regular ringtone. This is because you get multiple texts in reply, with directions for the download, and these texts cost money -- $1.99 plus call charges each. It's an easy case to make, it's simple consumer fraud, it's aimed at teenagers. A state attorney general who wants to make a name for himself (or herself) can have a field day with this.
Hitachi Eyes 1 Terabyte Drives, writes MacWorld, noting new technology the Japanese company says lets it put 4.5 Gigabytes of data on a single centimeter of hard drive.
I'm like, don't the first people read the second paper?
Moore's Law of Storage is rocketing along right now even faster than Moore's other "laws" (as described in The Blankenhorn Effect). Magnetic storage is eliminating the cost of physically maintaining content, any content, with profound implications for everyone.
Both Sony and Microsoft have recently announced efforts to "jump the iPod" with video downloads.
Neither effort is serious, in terms of 2005 serious. Both are attempts to place markers on the future and gain agreements with the content industries they think will mark the future.
And this is just what's wrong with them.
You don't open up a new market by focusing on the seller side of the transaction.
You open up a new market by focusing on the buyer side.
Eric Rice (left), responding to Dana's Law of Content, asked a real good question yesterday:
And who will be the ultimate judge of what is and is not good and compelling?
The short answer is you would. Not you, Eric. You. The person reading this. And you. And you.
The biggest problem blogging faces right now is it's hard to find the good stuff. Oh, much of the good stuff does get found. And, of course, what constitutes good stuff is all in the eye of the beholder.
I have made few comments about the so-called conspiracy against the Apple iPhone.
The story was that Motorola was ready to release a cellular phone that was also an iPod device, but it couldn't find any carriers for it.
What's more interesting to me is the tug of war now taking place among entrepreneurs between these two technologies.
And, surprisingly, cellular is losing.
The reason has to do with business models and open standards. (Thus the picture above of standard pawns, available from the good people at Rolcogames.)
It's one of the great laws of politics. As soon as people decide you have power, and you can be moved, everyone and his auntie is going to try and move you.
I hinted that something might be happening more than a month ago, but it was probably the controversy over Google News that tipped it over.
With Google News, from the very beginning, Google did something it claimed it wasn’t doing. That is, it exercised editorial judgement. As SearchEngine Journal noted, “While an algorithm based on publishing popularity chooses which articles are found under which keyword phrases, the news-authority sources themselves are supposed to be pre-screened by a human.” And some immediately started writing programs to see what those humans might be doing.
But just as I was objecting, wanting to get in, others were objecting wanting to stay out. Agence France-Presse has won an agreement from Google that News won’t even spider stories sent to its affiliates, while Jeff Jarvis is crowing that Google News no longer spiders “hate sites.”
And now the atmosphere of controversy has spilled into the main site. French law demands that ads for competitors not be placed against trademarks. Google complies, on its French site, but continues to employ them on its U.S. site, where the standard is different. So the French sue.
This weekend Slate offers a feature of Philip Anschutz, a conservative businessman (and big soccer fan) who has launched printed papers under the name the Examiner in Washington and San Francisco.
Jack Shafer syggests Anschutz needs to invest more in editorial and consider the Web in order to be taken seriously.
Correct and double correct.
I wrote about this several weeks ago, and what follows is that original copy. You can get it free any time.
The business has been at the heart of my "profession" for a century. The whole idea of a journalist as a professional is also a product of this business. I took my graduate degree from the Medill School of Journalism. Joseph Medill was the old reprobate who built the Chicago Tribune empire.
But as I've said many times here this whole idea of a "journalism profession" is a fraud. Professionals can make it on their own. Journalists can't. If you don't have a job you are not part of the fraternity. Even if you build a journalism company based on your vision of what the profession should be, you are always nothing more than a businessman.
In all the arguments over copyright and patents the interests of the middle class creator are constantly invoked, then discarded.
The fact is that, while most western countries are middle class, the structure of their creative classes is pre-Marxist. That is there are a few writers, artists, musicians and actors who get rich from it, and a lot who get virtually nothing.
Unless you have business acumen, or constant success in your field, you're very likely to end up poor. And without a big hit, you're nearly certain to end up relatively poor from your work in the content industries.
At the same time, those who manage the industry, whether or not they have any talent, nearly all wind up rich.
Thus there's a difference between what we find in society as a whole and the content society.
The big news in blogging today is not the FEC, but a concerted effort by media companies to kill it by co-opting it. (The illustration is from an Investigator.Biz feature on the slave trade.)
Companies large and small are hiring bloggers, full or part time, are launching their own staff-written blogs, or are seeking to have bloggers publish on company-owned sites.
The weapons they wield are money (I'm up for that), the machinery of publicity, and credibility.
Much of that credibility, however, is being defined by search engines, especially Google, which refuses to spider blog entries on equal terms with media-fed blogs.
If you want to find this entry, for instance, you must look in the main search engine. Specialized blog search engines get a fraction of a regular search engine's traffic, and are based on RSS, meaning they're self-organized rather than spidered.
The result is that the independent blogger today has the same problems finding an audience as an independent Web site would have had in, say, 1998.
X.400, I should note, was an interoperability system for moving messages betwen X.25 networks, and for billing the costs through the carriers. It took years to negotiate, it was difficult to implement, and it was made obsolete by the Internet's basic agreement to move the bits first and settle later.
Today's mobile or cellular operators (take your pick on the name) are much like the old X.25 operators, such as GEIS and CompuServe. The networks they operate are walled gardens, very proprietary, so it takes both technology and diplomacy to get stuff over the walls.
This is not cool, once customers start taking pictures with their camera phones and (under operator urging) want to share them.
You may have caught the nasty 509 error which hit this site yesterday.
Here it was no big deal. It was a technical problem. It was fixed.
But it did occur to me that, finally, the market for core bandwidth is starting to turn around and Web hosts are finding themselves in the position of restauranteurs. (Thus, we're repeating our picture of Italian restauranteur Mario Batali.)
You may now think about Parmesan Reggiano, some nice Balsamico, the cool breezes of Tuscany, an artisanal bread and a fine bottle of red. I'll explain.
Whatever idiot at Agence France-Presse is pushing to keep its stories from being linked widely might want to do a re-think after reading this.
AOL is far more powerful than Agence France-Presse. At one time its walled garden was the most powerful force online. Its shareholders took 45% of Time Warner's equity in 2000, and while that's now worth a fraction of what it was (thanks to the fact they weren't really worth the price), it's still a lovely parting gift (and thanks for playing our game).
Well, after spending billions of dollars and five years fighting the inevitable, AOL has succumbed.
When a currency becomes overvalued it gets tossed like confetti. This is what happened in the late 1990s, and it's happening again. (The allusion, of course, is to the hit song 1999 by the man at left, known again by his given name, Prince Rogers Nelson.)
Yahoo's P/E is at 54, Google's is 123. Their stocks are overvalued in a market where the average P/E is still said to be near historic highs.
It doesn't matter whether acquisitions are made with cash or stock. Cash acquisitions, after all, can easily be handled by the company selling stock. Yahoo has been especially active in this area.
Companies of all sorts want this currency, and thus we have both Yahoo and Google on an acquisition binge.
This summer will be the peak of the Voice Over IP (VOIP) boom. (The illustration, by the way, is from Poland. No, he doesn't look Polish.)
It's an easy prediction because Philips announced at CTIA a reference design for "converged handsets," with 802.11 and GSM or GPRS cellular in the same package.
We've seen the success of Vonage and Skype. We've seen the growth of 802.11 "hot spots" in hotels, airports, and on campuses. We've now seen the cellular industry adopt to VOIP. It's happy days.
If I'm on Cingular, and you're on Verizon, and our friend is with U.S. Cellular, in other words, we can easily exchange short text messages. But exchanging, say, photos or music is nearly impossible.
CTIA didn't answer that challenge, but it turns out CeBIT in Germany did . An outfit called conVISUAL in Oberhausen, Germany (near Dusseldorf, in the Ruhr, the heart of the Bundesliga), did.
The USC Online Journalism Review is too filled with major media types to be truly clued-in about the blogosphere. Although they try. And to the major media they really seem to "get it."
They don't.
How else do you explain this, a long whiny piece from Mark Glaser moaning over a professional journalist's decision to shutter a personal site due to his conflict of interest.
Instead, Glaser cries censorship, acts like there's nothing to be done, and downplays the very-active role other Indian bloggers are taking in publicizing what has happened and working around the problem.
Over in New Orleans, the assumption at this year's CTIA show is "The Next Big Thing" is video.
Video clips, sold like ringtones. The mobile Web is TV, just as last year's mobile Web was radio. (The picture is from the story linked-to in this paragraph, at PocketPCMag.com.)
I think this is wrong-headed thinking.
That's not to say video won't have a place. It will, especially where desktop Internet penetration is low. Within a few years, I suspect, we'll see a "mobile BitTorrent", because the kind of video that will be in highest demand will be that which is most likely to be suppressed, and not shown on TV.
But video still isn't the Killer App for the next wave. Video is going to remain a niche.
Here in one sentence we the utter cluelessness of the industry.
Newspapers have always given away their content. Always. The money you pay for your daily paper goes only toward its distribution costs. The ink, the paper, the printing, and the entire editorial budget (which is just 8% of the total, although publishers act like it's the whole thing) -- that comes from advertising.
There are more American labels around. Apple. Motorola. Microsoft. The U.S. companies are good at seeing the opportunity and writing software that works.
Our balance of payments is not helped by it.
As Cynthia notes (deep in the article), these boxes are being made in China. (Actually most of them are being made in Taiwan.) Some of the software conceptualizing is being done here, as is the marketing (although I suspect some of that software work was off-loaded to India).
Those failing, flailing Japanese outfits she mentions, meanwhile, are still doing everything in Japan. Or they're doing "too much" in Japan. Except for Sony and Nintendo Japanese companies were never good at anticipating demand. Mitsubishi, Canon, C. Itoh, Ricoh, et al -- they were manufacturing houses. They were China before China was cool.
Note: The following was published today in my free weekly e-mail newsletter, A-Clue.Com, now in its 9th year. Join us -- always free.
The last time I wrote about Permission Marketing (from the book by Seth Godin, right) I described the "permission tree" and urged you to audit all levels of permission so you could make use of them.
Now I'm going to tell you how to apply permission to the highest levels of personal transactions, the selling of homes and cars.
It's Lotus Notes inventor Ray Ozzie. While Ray may think he sold a company to Microsoft, Groove Networks, in fact his world is about to get rocked like never before.
Groove does collaboration tools, and Microsoft (an early investor) is interested in those things. But I don't think Gates signed off on this deal to get Groove's technology, otherwise he never would have un-retired Nathan Myhrvold's title. (Microsoft currently has three people with the CTO title, meaning no one really has the power.)
The bottom line is that Gates needs Ray Ozzie, and he needs him bad.
Microsoft puts more dollars into new technology development than just about anyone else in the world, but it gets less bang for its buck than any outfit since Xerox PARC. Microsoft Research has a ton of high bandwidth people, they're doing all sorts of high bandwidth things, but when was the last time Microsoft introduced anything of real importance?
There's nothing journalists like better than a good old fashioned catfight. (The animated gif catfight is from Supah.Com. I guess you can send it to friends as a postcard.)
And in tech journalism today it doesn't get any better than Pamela Jones vs. Maureen O'Gara.
Jones edits Groklaw, the free community blog which has covered the open source revolution's legal defense so expertly. Her stuff is so good that SCO talked about putting together a rival site, called Prosco.Net, last year. (As of this writing that site is still empty.) Jones is so ethical she actually quit a really good job to stay on the beat, writing "money is nice, but integrity is everything." (I think I'm in love.)
O'Gara edits the $195/year LinuxGram newsletter. She writes fast, tight, "insider-type" stuff, with tabloid headlines like "Ray Noorda's Competence in Question." She learned her trade at CMP, and calls her company G2 Computer Intelligence.
Conflict was natural because of their differing styles. Jones is careful and shy to the point of near-invisibility. She writes like a lawyer. O'Gara is brassy and bold and uses the rest of the press as her PR machine. She writes like a journalist.
What got the feud rolling was a stunt O'Gara pulled before the court in the case of SCO vs. IBM. She filed her own motion to unseal the records, then did a story on her heroic act.
Newspaper companies do this all the time. They fight to unseal records of criminal trials or government decisions, writing a series of stories on the filings and the reaction. But Jones didn't like O'Gara's headline, nor the attitude in her story which was (to say the least) self-congratulatory.
No hostility there. Maybe a little around the edges, oozing out? Leapin' Lizards, Batman, the heroine action figure who apparently wishes to Take the Open Source Movement Down singlehandedly is none other than Maureen O'Gara, who is asking the Utah court to unseal all the sealed records:
With Bluetooth viruses causing all kinds of havoc, and forcing millions to close the open ports on their phones, it seems strange to be writing about a "Bluetooth Network" connection.
Here's the deal. Wideray customers put kiosks in the stores, and when someone comes over with a Bluetooth device they can feed whatever they want -- games, demos, product details. (It also works with Infrared or WiFi.)
I have used the system at trade shows, and its effectiveness is limited by the client device. If the device has limited power and storage, the effect of the download is minimal.
But, with even Nokia Symbian phones attaining the power and storage of older PDAs, this is changing. Wideray now supports Microsoft and Symbian, as well as Palm devices.
From Medgadget comes word that Always On was a theme of the Demo conference in Scottsdale, Arizona, last week, even if they didn't use the name.
One such exhibitor was Lusora, a San Francisco outfit that claimed to be in the security business, but also introduced a medical device.
It's all quite wonderful, but there is one big problem.
Standards.
Lusora's medical gadget uses Zigbee, and its hub, on the surface, looks proprietary, even though it's based on industry standards like WiFi and TCP/IP.
I could be wrong. I hope so. I've contacted their PR folks to see if they can be helpful. And I'm certain they can be.
For decades employed journalists have considered themselves a class apart. Charged by their employers with deciding what was relevant, they took fame and turned it to infamy, often violating confidences, and said they were just doing their jobs.
They ignored the concentration of power in their own business -- a journalist is someone who works for someone (who buys ink by the barrel, spectrum by the megahertz, bandwidth by the terabyte) -- and expected a legal shield to protect them and no one else.
When Microsoft tried extending its Smart Tags feature, which sounded awfully similar, into Internet Explorer, Robichaux wrote in Exchange Security, "the furor was incredible. Walt Mossberg, Dave Winer, Dan Gillmor, and a host of other influencers immediately started screaming that Microsoft was taking control over web content and generally acting like an 800-lb gorilla. The EFF even opined that the MS smart tag implementation might be illegal."
He's right. But does it matter?
Microsoft has used its power for a decade to extend its monopoly across desktop applications and into the Internet itself. As a result it has a very poor reputation.
Google, on the other hand, has offered optional services, in software, on top of its search service. It has a stellar reputation.
Sony blazed new trails among Japanese manufacturers, preferring proprietary control of its technologies, emphasizing design and its brand name, acquiring American firms and integrating them. In the 1990s, on the other hand, Apple was a troubled PC maker with a small market share.
This was before two things happened. Apple's genius returned to his throne, and Sony's faded from the scene.
Sony Founder Akio Morita, who passed away in 1999, was a legendary entrepreneur, a visionary, a genius. In Tokyo, Elvis has indeed left the building.
Still, in the first year after Morita's death, Sony could have done the deal easily. And the spirit of a man equal to Morita in vision, Steve Jobs, would be working for Japan Inc.
In a New Yorker profile of chef Mario Batali (left) there's a wonderful scene of Mario rooting around a waste pail, looking for what the author-turned-prep chef has tossed away.
Our job is to sell food for more than we paid for it, Mario lectures him. You're throwing money away.
Apple Computer is the greatest exponent today of what I call Batali's Clue. Your job, as the maker of products, is to get more for your creation than the cost of the electronic "food" that goes into it.
It's a vital Clue because components in the Moore's Law age spoil like dead fish on a wharf.
Here's an example plucked from today's headlines. (Well, the ad pages.)
It's nice when someone in the "major media" gets the Always On vision, no matter how they get there.
The vision is simple. It's a wireless Internet platform. You get there by combining robust scalable PC applications with Internet connectivity and WiFi.
I'm fascinated with how Western technology filters into the developing world and changes lives.
For instance. Back in the mid-1990s we had the idea of the "Internet Cafe." It would be flash, it would have broadband, it would have great food. We were crazy.
Now we have cellular, or mobile service. (Whichever you prefer.) In the West, it means everyone has a phone, and they're on it all the time. Young girls drive like little old ladies. Guys look crazy seemingly talking to themselves, but then you see the little bud in their ear -- oh.
Then it filters down. Read how it filters down in Cameroon, from the Cameroon Tribune in Yaounde. (Then get the scene at the top of this item as desktop wallpaper, free, from Dane Jacob Crawfurd.)
Mobile carriers are trying to make an impossible transition.
They want to move from a data world where every bit is precious, and where every file is controlled, into a broadband world where phones have PC functions. And they want to do it without changing their business models.
It can't happen. The industry's dirty little secret prevents it.
That secret is that most cellular minutes today are wasted. Perhaps as many as 80% of the minutes customers are allocated in their contracts each month aren't used. And this has been the source of immense profits. (The illustration, in time for Valentine's Day weekend, is a Korean product for women that also enables the creation of twin secrets.)
Modern cellular marketing is all built around contracts, with a fixed monthly charge for a fixed number of minutes over a fixed term. To get contracts incentives are offered, including free phones.
But look at what happens. Marketing convinces people to pay high prices for plans with high limits. Cingular's "rollover" plan costs a mininum of $40/month, which comes out to about $45 with taxes and other fees. Advertising convinces people they need high limits to deal with "ugly over-age charges." But it's difficult to measure your usage in the middle of the month, and the vast majority of customers don't come close to their limits.
When the contract term expires, usually in a year, customers can theoretically leave that carrier for another one, taking their phone number with them, and even get a new set of incentives, like a new, more advanced phone. But most are as ignorant of their contract expirations as they are of the status of their minute bucket. (Quick: what's your contract expiration date?)
Carrier profitability thus depends on ignorance, customers with old phones who don't take out new contracts and don't use their gear. And in that environment, who needs broadband? Where is the market for PC functionality?
The H-P brand is about teamwork, Frankel writes, but Carly transformed it into executive fiat. The brand became Carly, not the team spirit that built the company.
This is fascinating because Sprint, alone among U.S. telcos, has a unique business model, at least in cellular.
It wholesales.
Lots of companies, from Virgin to Earthlink to Disney, have gotten into the cellular game by re-selling Sprint's capacity. They all have their reasons. They all have their own branding, their own marketing, and their own niches.
The point is Sprint is profiting from wholesaling capacity to these companies. Profiting big time.
Ever since the Web was spun I've been looking for a better way to track the news.
I have created some in my time. I launched the Interactive Age Daily for CMP. I created the A-Clue.Com weekly newsletter.I like to think this blog helps.
But the raw material I use has changed constantly. Maybe that's a good thing, because some of my value as a journalist lies in my ability to dig through this raw material and give you the good stuff.
Now that Star Trek is officially dead (no new shows or movies, even in production) the time has come for a new idea.
Here's one.
Stardate.
It's an anthology series, built around various scientific "principles" that define the Star Trek franchise.
Think of it as Science made into Drama.
Yes, it's an excuse to make science exciting. (Just think of the educational spin-offs we can produce!) And the production costs are low enough to put this on the SciFi channel (where Enterprise should have been all along). Or might I suggest a pitch to Discovery Networks, which has got proven talent in making science fun with shows like Mythbusters?
For host, might I recommend Stephen Hawking? Playing the role Alistair Cooke made famous, he opens each show by describing the science (and the Star Trek technology) on which the show will be based. (I might recommend getting several scientists for this role, perhaps one for each specialty. But Hawking is a name. He'll do great for starters.) Or, with confidence this show will last for decades, Lance Armstrong, who's already under contract to Discovery, who knows how to read a cue card, and who owes his life to science?
I have written a bit on RSS here, often wrongly. (The illustration is from the blog of Andrew Grumet, who brings the complexity of video feeds to the process.)
I have bemoaned the delivery of ads via RSS, both as content and within feeds, as "RSS spam."
My complaints were misdirected, as I learned. The problem was not in the feeds, but in the reader. After I patiently explained my problem to my newsreader maker, I was told "we'll work on it."
And what is my problem?
My problem is I want all the real news and commentary on the field I cover, and that's all I want. You don't get that with a simple keyword field.
As always in technology, problems are usually opportunities turned on their head. New start-ups are emerging that hope to use RSS as a true intelligence gathering service, instead of as a garbage in-garbage out collector.
What they say is what I've said, that separating wheat from chaff is very difficult. They are going about that in different ways. Rojo is doing it privately, just letting a few people in, while Bloglines is doing is publicly, creating a versoin of Google's PageRank algorithm.
The printer is in Moto, a Chicago restaurant, and it's programmed by executive chef Homaro Cantu. The paper is the same stuff you see on some birthday cakes, made of soybeans and cornstarch. The ink is edible, and the flavors are powders placed on the paper after it's printed. This means he can create a 10-course "tasting menu" that won't leave you bloated -- just well-read and out several Benjamins.
Cantu is making paper sushi and menus that can be crunched into his gazpacho for "alphabet soup."
Many companies re-sell cellular capacity. It's a simple branding exercise.
Earthlink is the first to enter this business with a vision. The vision comes from founder Sky Dayton, who kept the chairman title for years after leaving for Boingo, but has now relinquished it to run this new joint venture, SK-Earthlink. (Glenn Fleishman interviewed Dayton and has a great story on him.)
Dayton's vision, since the beginning, has been based on the idea that spectrum is plentiful, that WiFi can be connected, and that a telecom firm doesn't consist of wires and switches but software and marketing.
Earthlink itself is based on the idea of re-sale. Its dial-up service rides on top of the existing phone network. Its DSL offerings are based on the same networks. It's not a stretch.
So, what's the vision? Jump over there with me and I'll tell you.
It's not capitalism. Capitalism does not by itself guarantee competition. (Image from Clint Sprott at the University of Wisconsin. Go Badgers.)
That is does is the biggest lie told by political conservatives.
Capitalism, in fact, evolves toward monopoly, or to its cousins duopoly and oligopoly, just as ecosystems evolve toward a "climax" state that can only be re-set by catastrophe.
The only mechanism we have to protect competition against this natural tendency is government.
Only a government strong enough to stand up against the biggest enterprises can guarantee competition.
This is difficult to assure.
It's difficult to assure because money corrupts, and corporations -- not government -- are the source of money. It's your money, and unfortunately corporations are considered as people under U.S. law -- immortal people who can't be jailed.
If the last several months proves anything, it is that there are many ways to grow in the cellular business. (Birthdaycraftsandsupplies.com offers a fine selection of Pinatas. Ask them to bring back the dollar sign one to the right. Don't you agree it looks cool?)
You can grow organically, as Verizon has done, stealing enough AT&T Wireless accounts (better technology and concentrated marketing) so Cingular may find its prize (we're number one) turning to dust in its mouth.
You can grow by buying licenses, as T-Mobile is doing this week. Government spectrum auctions brought in nearly $1 billion this week and T-Mobile looks like a big winner.
You can grow through alliances, as Sprint is doing. Its latest catch - Earthlink is going to private label its spectrum.
First and foremost, it would be the murder of a great company by the government. It was government that broke up AT&T in the 1980s, and it was government that made AT&T non-competitive in our time.
Second, of course, it means that business tributes to the U.S. government are even more important than previously imagined. If the government can murder the nation's largest company (albeit over time and in chunks) it means no company is safe from a rapacious government, regardless of party. (Is is coincidence that AT&T was forced to divest during the Reagan Administration, and killed under Bush II? Check the campaign contribution files for the answer to that one.)
Word that mobile phone makers (and some networks) want to embed WiFi and VOIP into phones brings up a crucial point about the VOIP market, and about how technology works in general.
There are two major threads of VOIP software out there. Most, like Vonage, work along a standard. Then there's one who doesn't.
But that one is Skype.
Guess which of these two "standards" leads?
Skype. By a bunch. This puts another twist into the whole discussion of VOIP, and VOIP-cellular in general. Because there are multiple models to choose from:
Gary Wolf has a piece at Wired which had me shaking my head for some time.
Several folks have pointed me to it. It's an imagined memo, dated three years into the future, after Linus Torvalds has supposedly gone to work for Mr. Bill Gates.
The idea behind the imagined memo, something I've written about extensively recently over at ZDNet's Open Source, is based upon building a Linux desktop suite. Wolf's point, apparently, is that Microsoft moving to Windows isn't that far-fetched, that Steve Ballmer doesn't get it, and that Gates has the imagination to listen to the market rather than the yes-men in Redmond.
The significance of WiFi-cellular roaming lies in Always On applications.
Think about it. Cellular channels are relatively low in bandwidth, WiFi channels are high in bandwidth.
Now, you're wearing an application, like a heart monitor. When you're at home, or in your office, this thing can be generating, and immediately disgorging, tons and tons of data, detailed stuff that may be fun for your doctor to analyze later.
A "blogger" named "Oscar" has dozens of blogs on Blogger, which seem to have no purpose other than to to churn out spam. (Like the image? It's from Rhetorica, which was talking at the time about comment spam.)
Blogger does have some fine features for the spammer. You can set it to e-mail everyone on a list whenever the blog is updated. So if you're a "master spammer" all the little spammers get the updated script simultaneously.
Google, which owns Blogger, is either blind or willfully complicit to what's going on here. (I'm guessing blind. It's a big virtual world out there, and Google does try to get things right.)
The more significant point is that what's going on is the systematic destruction of RSS as a medium for conveying thought. Already it's becoming impossible to maintain a "keyword" RSS feed. By that I mean that if I tell Newsgator, "send me everything on cellular," I'm going to get a lot of junk, not just from Oscar, but from direct sales sites, resume sites, and "wrap" sites, which place their ads around other sites' content and broadcast it via RSS. (What I need, Newsgator, is a way to create keyword-searches while at the same time blacklisting specific URLs -- then I wouldn't be able to write items like this one.)
But that is not all, oh no, that is not all. Because wherever crooks go unmolested, honest businesses are going to follow.
The idea is that you and your friends subscribe to Dodgeball, then text your location to one another at night, so you can get together. (And if they have friends with them, and those friends are attractive, voila!)
Absolut Vodka sponsored a "nightlife channel" on the service last year, like a traditional media buy, so Dodgeball members could associate the brand as a "friend." (Beats having an AA sponsor, I guess.) Now they're looking to make more money from things like Premium SMS and applications.
The Six Apart-LiveJournal merger is not a roll-up.
Roll-ups happen when there is an established way to make money at something. No one has really found a way to make a reliable dollar from blogging.
Not that people aren't trying. There are tons of new blogging programs out there, tons of new file types to blog, tons of new blogs (of course) and tons of new paradigms.
It's an industry in the process of discovering itself.
Here's the short-form. Roll-ups are about money. Without money, mergers are about people.
From reading the statements of the principals, this merger is what I call a "team-building" exercise. The VCs behind Six Apart (the company that owns Movable Type) are trying to build a winning team. That's one of them over there to the left, Joi Ito.
A few years ago Jackson, Mississippi was the center of the telecom universe.
That's because it was the home of Canadian-born Bernard Ebbers . He married a Mississippi girl, Linda Pigott. On such chances does history turn.
Ebbers launched a long distance outfit called LDDS in the early 1980s and turned it into a classic "roll-up," buying other companies (usually for stock) and managing to the numbers.
For the last year I've been harping here on the subject of Always On.
The idea is that you have a wireless network based on a scalable, robust operating system that can power real, extensible applications for home automation, security, medical monitoring, home inventory, and more.
As I wrote I often came back to Motorola and its CEO, Ed Zander. They would be the perfect outfit to do this, I wrote.
Little did I know (until now) but they did. A year ago.
It's called the MS1000.
The product was introduced at last year's CES, and re-introduced at various vertical market shows during the year. It's based on Linux, responds to OSGi standards, and creates an 802.11g network on which applications can then be built.
At this year's CES show, Motorola is pushing a home security solution based on the device, with 10 new peripherals like cameras and motion sensors that can be easily set-up with the network in place, along with a service offering called ShellGenie.
Previously the company bought Premise, which has been involved in IP-based home control since 1999, and pushed a version of the same thing called the Media Station for moving entertainment around the home.
What should Motorola do now? Well, the platform is pretty dependent on having a home PC. The MS1000 could use space for slots so needed programs could be added as program modules. They need to look at medical and home inventory markets, not just entertainment and security.
But they've made an excellent start. And from here on out everyone else is playing catch-up.
The most dangerous word in telecommunications today is bundling. (This is the kind of bundling we're talking about by the way, the kind represented by this shrinkwrap machine, from the good people at Pierce Packaging Equipment.)
All the carriers are doing it, more and more. The cable company wants to bundle Internet service for you. The phone company wants to bundle mobile service, Internet, and maybe a dish (so you won't need the cable company).
The deals go by names like "triple play," and it's getting worse, as Time Warner aims to become a Sprint re-seller simply so it can offer a "quadruple play" of phone, Internet, cable and mobile. BellSouth already offers something like this, and SBC wants to add TiVo-like services to its bundle.
What can be wrong with this, especially when they're offering a bargain price on the bundle? (Some are, while others are just stressing the "convenience" of having one bill.)
As a struggling artist I'm always on the look-out for new ways to make money. (That's Paul and Stan of the Housemartins singing for their supper in 1984, from an Australian fan's site.)
Once I had a Web site and made it run, made it race against time. That was in the 1990s. Since the new millenium dawned, I've been in buddy-can-you-spare-a-dime mode.
I can laugh about it since my sainted spouse has a good job and shows no signs of leaving (she likes my cooking). But it would be good for the old ego to be something other than a kept man, y'know? (Not that there's anything wrong with that.)
I've tried many things. I was a highly-respected market analyst for a time but the firm turned out the be a scam that took a year of my pay off to Chapter 7 of the bankruptcy code, opening again under a new name. I've done some columns, I've had some freelance gigs, and Corante has gotten me some scratch working for ZDNet.
As usual the press is being plain silly. This is not a threat to mobile carriers because WiFi, as yet, offers no real mobility. And that's just not likely to happen because most WiFi connections are not networked.
This reads like a contradiction in terms, doesn't it?
Blogging is instant publishing. Part of the idea is that you're getting a raw feed.
But in fact most blogs are edited. Because most blogs are produced with words.
You don't need Microsoft Word to edit a blog. I am editing this in the blogging window. But for most people, coherence requires a bit of editing. You need to step back, put things in a proper order for the reader, and link what you've gotten so it makes sense as a story told, rather than a story experienced.
You can see this clearly when you see the liveblog of an event. Last year's conventions are a bad example. Because the stage happenings were broadcast there was no need to type what was said and put it out. Bloggers reverted to their normal role there of looking for "inside" stories, and wound up as near-clones of their "big media" counterparts, only without as many sources. They edited on-the-fly to create coherence.
What does this say about other types of blogging, using bigger files like audio (audblogging), mobile phones (moblogging) or video (vidblogging).
Over the weekend C|Net ran a story indicating the Mozilla Foundation hopes to add calendaring functions to its Thunderbird e-mail client (right), turning an open source Outlook Express clone into something more like Microsoft Outlook.
What follows is pure speculation, but this could make Firefox the big story of 2005, and beyond.
A few months ago Forbes had a nice article on NTT DoCoMo's iMode service, and Kei-Ichi Enoki, the man behind it. (Forbes stories are all about heroic executives, since the rich strivers are the only people who matter to it.)
The point, for us, is the direction mobile data services may take after the obvious niches, like e-mail and games, have burned out.
Enoki's answer -- remote controls. Not in the sense of point it at your TV, but in the sense of remote control of life functions. Enoki is turning iModes into electronic wallets, personal shoppers, GameBoy and iPod replacement.
There's also an answer to the item that follow this (and was written a few minutes before):
The enormous popularity of the iPod, and its dominant share of the market (some say as high as 95%) has created a new family fun game for reporters this Winter, which I call "Get Steven."
The idea is to find someone, somewhere, who can threaten the iPod's market dominance, then spin a story around it.
Others, like Hiawatha Bray (right, from Dan Bricklin), know what their editors really want -- a local guy who claims he can take down the giant.
And that's what Bray delivered, in today's Boston Globe. (This is why he gets a fat paycheck and I'm just a blogger.)
Bray found a little outfit in suburban Andover, Massachusetts called Chaoticom. Chaoticom is OEM'ing technology for putting music functionality into new mobile phones, the kind with hard drives in them.
Good story. And since in the Chaoticom universe the music delivery is under the control of the carrier, there's some momentum.
Charles Leadbetter, a freelance analyst who works with Demos of the UK and others (sort of like me but with better management), offered some great insights into the need for regulation recently that have been making the rounds of the blogosphere. (That's one of his books over there.)
How to Profit from Ignorance posits that regulation is needed to regulate ignorance. As life gets more complicated, we become more dependent on experts. Regulation becomes the experts' stamp of approval.
But there's another way of putting the same point -- transparency.
I'm dating myself here, but back in the 1970s, at Wiess College on the Rice campus, there was a four-square court. Four players, you bounce a dodge ball into one square or another, and the person who can't get it into another square on the bounce is replaced, with everyone rotating around.
Sometimes the ball would fly into the crowd of waiting players and passers-by. We'd shout "IBD," which stands for Innocent Bystander Drilled.
If the Sprint-Nextel deal goes down, Motorola is IBD. (You might want to get Motorola CEO Ed Zander one of these nifty t-shirts.)
With many companies now substituting WiFi for wired networks, it's natural that those with multiple locations would want to tie them all together.
Bluesocket Inc. of Burlington, Mass. (right, from their home page) is among those getting into this game. Their home page describes them as "building an enterprise-class WLAN" and they claim their new WG-400 Wireless Gateway can handle as many as 50 users at the same time, which is pretty nifty.
But is there a general problem here? Perhaps there is.
There is a lot of wailing-and-gnashing-of-teeth going on about ESPN entering the mobile phone business, through an agreement with Sprint.
It's not that big a deal. Sprint made these co-branding deals, called MVNO in the biz, a big part of its strategy. Virgin, Carphone Warehouse and 7-Eleven are signed-up, and Wal-Mart is reportedly taking a look.
What do you need to become a Big Time Mobile Phone Brand?
Back in the 1990s one of the bigger stories I covered concerned an outfit called TotalNews.
TotalNews tried to make a living for itself by putting its trade dress around others' news stories, even covering the original ads with its own. After a legal fight it backed off, but it did not disappear.
Fast-forward nearly a decade. Since getting access to an RSS feed I've seen a lot of links from something called BigNewsNetwork. Here's one. It looks like a story from Israel, a panel complaining about regulators.
Microsoft has launched an experiment in tightly-controlled liberty called MSN Spaces whose attitude is very oriental, nearly Chinese.
Spaces is a blogging tool (Microsoft loves to own the language, thus blogs become spaces as bookmarks became favorites) with a difference, namely central control and censorship.
However it's defended, and whatever it's called, control is the essence of the Microsoft experience. You will only use Microsoft tools, and Microsoft formats, under Microsoft rules, and write what Microsoft allows.
What could be more Chinese? (The link preceding is to the location of the art at the right.)
The two brief items below are examples of a new feature here at Corante, called Blink.
Blinks are quick hits, references to stories happening within our beats. Just a link, maybe a few words, based on something we found of interest but have yet to think about thoroughly.
I get no credit for any of this. Your encomiums should go to Hylton Jolliffe (right), our fearless leader, who has also been implementing other changes to make our blogs more "competitive" for reader interest (and advertiser dollars) as we go into 2005. It's true his forehead is too small and narrow for him to be a truly "handsome man" as I am, but we at Mooreslore are hopeful the course of time may change that.
I have been privileged to have written with Hylton for nearly two years now. He is honest, innovative, fair-minded, a good man in every way. I've chided him in the past that he should be rich as well.
Maybe (blink, blink) we can get to work on that now....
If you're a kid it's pretty exciting. But I've seen this parade before, many times. I can enjoy your pleasure, but that doesn't mean I'm not going to join "Santa" later at our favorite bar for a few pops and expect he'll make me pick up the tab.
The big truth is that it's now pretty trivial to put a TV tuner into a mobile phone. Yes, the days of Dick Tracy's wristwatch TV are really here. (Image from USA Today.)
Of course you remember what Tracy used the technology for? To see his boss while he was talking to him. I did the same thing at the 1964 World's Fair, where AT&T had a videophone demonstration. It was no big deal then, and it's no big deal now.
Entrepreneurs like Blake Krikorian of Sling Media, who is profiled in the Business Week story above, think you'll use the capability to watch their streams. Most people watch brief snippets of TV anyway, not whole shows, he says. No time. So offer them such streams for the moments where they're standing in line at the Airport, or waiting for a meeting to start, and they will pay through the nose for them.
I was hammered here recently for a piece in which I warned of what I called RSS Spam. (The image is from the home page of Geekzone, and it's a Clue to what comes next.)
Well it's my own fault, I figured. I'm looking for everything on a specific keyword, and if some store is keyed to that word I'm going to get their stuff. Yes, a good RSS editor should be able to filter-out that stuff, allowing me to unsubscribe to anything that I don't like, but still...
But now that trend has taken another step, so I feel compelled to come back to the subject of my humiliation.
If you don't want to hear about it, don't click below:
He is known to the lay person, if at all, for a program called Mathematica, which has done as much for the acceleration of change as Moore's Law itself.
By boiling down what you can do with mathematics into a computer program, Mathematica freed science from waiting on mathematics to analyze data. The program helps you devise formulae that work, so the results you get are proven. When people would say "it's not rocket science" they were often referring to the combination of math and science required to launch a rocket. Now, thanks to Wolfram, even rocket science isn't rocket science anymore.
Not only that, but Mathematica made Wolfram's Wolfram Research a going concern, a real business. It freed him from the demands of academe. He truly became the elephant that could tap dance. (He's no Gates, but he's pretty good at it.)
Still, as they always say, what have you done for me lately?
Nokia's Preminet is a direct lift from Brew's business model. It solves a lot of problems, but leaves some intact.
The idea is to simplify how developers get their products certified, marketed, and paid for. All good. But there's one big problem that isn't addressed.
Consumers.
Here are some of the questions you might ask if you're a mobile phone user:
NOTE: The above paragraph originally said the conference was in England, but Chris Potts corrected me. Also, the folks at Semacode deserve credit for extracting the slides and pointing them out to us.
First was a chart tracking the cost of making a smartphone over time, going back two years and forward six. (These are PDF files.) Despite the fact they're getting a lot better, they're also getting cheaper -- the bill of materials cost could be cut in half in four years.
John Naisbitt and a herd of library assistants basically looked at news stories from all over the world in order to divine underlying trends -- they extrapolated the recent past to describe the future.
He made a bundle.
Now a man named Charles McLean, working at an outfit called the Denver Research Group, has updated the concept using RSS feeds. David Ignatius (pictured, in his official portrait) has the story.
The title of the piece is "Google With Judgement," a title suggested by McLean. What he does is monitor 7,000 political sources (probably everything with an RSS feed) in an attempt to catch trends before they start.
McLean is cagey on his specific methodology. He's trying to sell the process for big bucks to corporations that need to know what the market's thinking quickly enough to act on it. But it sounds like he's databased a bunch of feeds and learned to distill their meaning pretty accurately.
I was late to Seach Engine Optimization (SEO). It seemed to me like a parlor trick.
The idea of manipulating a search engine's algorithm so as to dictate the first results a user sees feels like...cheating.
But I know a lot of people who use it, honest people. I've seen the good work SEO voodoo can do. And I've learned that, when done in conjunction with a complete online marketing campaign, instead of just in isolation, SEO is an important tool in the online marketer's toolbook.
I'm talking about more than the Presidential Polls. I'm talking about any survey, public or private, no matter the subject, that claims statistical validity based on calling people on the telephone.
Andrew Odlyzko at the University of Minnesota (pictured, from his home page) was kind enough to pass along a link to a piece he did on the non-technical hurdles to micropayments. (It's a PDF file.)
When people see a meter their wallets freeze up. People would much rather pay a higher price over a fixed time than a tiny price each time they use something.
Elsevier, one of several academic publishers to try pay-per-view pricing in the mid-1990s, it found that "as soon as the usage is metered on a per-article basis, there is an inhibition on use or a concern about exceeding some budget allocation."
Fortunately this is a bipartisan recognition. The Post comment above is written by the Republican Senate Majority Leader, Bill Frist (right, from CNN), and a leader of the minority Democrats, Hillary Clinton.
These ladies aren't discussing the battle between Real Networks and Apple. But there's an important Clue to be derived here nonetheless.
The dispute between Real Networks and Apple Computer over getting Real songs onto the iPod is a business dispute, even a legal dispute. It's not supposed to be about politics or religion. (The illustration, from the Portland Tribune, is from a political rally.)
Customer loyalty, usually a wonderful thing, can be turned into passion that looks very political indeed. And when Real tried to make this political, through a petition, the backlash began.
The power of Windows lies in your ability to create and market profitable applications using it.
Yes, there's a limit. Once Microsoft decides it wants your market, your cost of defending the market will likely exceed any incremental sales from that effort.
But Linux lacks Windows' ability to make software profitable. And that is why Windows, not Linux, will lead the next evolution in cellular equipment.
SSEYO has announced miniMIXA, an audio mixer for Windows smartphones.
As part of the roll-out a Reading, England arts festival will use it this weekend to mix what is being played “on-the-fly.”.
This could do to the cell phone market what programs like Musicmatch did to PCs.
The impact could be massive. Ringtones could be created at concerts, and sold right after the show. On the other hand, concert-goers could potentially bootleg the same concert and offer better mixes, free, within hours after the show.
This leads to Dana's Law of Creativity Software.
The cheaper it is, the more people can use it, and the lower the premium paid for poor results.
If you want to see what this thing is capable of, check out these sample mixes for yourself. Or, if you don't have a Windows cell phone, get a taste for the technology by downloading Sseyo's PC plug-in.
Every day, it seems, I see more and more people trying to use the blogging metaphor to make money. (The image, naturally, comes from business-blog.com.)
The question remains whether blogging will become subsumed into other media (lots of high-tech publishers, like Business 2.0, now have things they call blogs), whether new journalism businesses can be built on blogging, and whether blogging will be an individual or community endeavor.
If H-P Chairman Carl Fiorina had to report a bad quarter, which he could blame on one group, and if he then sacked the heads of that group, we'd call Carl one tough hombre.
But the H-P Chair's name is Carly, not Carl. (Actually, it's Carleton.) So guess what you were thinking when you read the news? (Picture from PBS.)
Yes, indeed, sexism is alive and well, even after you break through the glass ceiling.
Each time a member of my family needs any type of medical care I'm frustrated. (The image is from the good people at Tympanitis.com, fighting the good fight against otitis media, and is used here completely out of context.)
Mainly I'm frustrated by paperwork and waste. I'm frustrated with filling out forms, and dealing with bureaucratic clerks.
I'm frustrated because it's all so expensive, and all so unnecessary. There are technologies available today that will cure this problem, solutions that can be implemented now.
If big insurers gave clients smart cards, and insisted that all members of their networks take smart card readers, it would be a big start. Entire medical histories, and biometric identification, could be mounted on the cards cheaply. Read the card and the doctor's network automatically knows what it needs to do, about the patient and the billing.
What began as an attempt to de-fang the wolves of Wall Street has descended into a Silicon Valley farce.
The problem with Google's IPO delay does not lie in the technical glitches of the system. And it doesn't lie in the really silly price being quoted -- $110 per share.
It lies in the great scandal of the 1990s -- stock options.
The secret to turning a blog into a financial success lies in the word community.
Community is what lets a blog scale from one person spouting off into a true online service, with enough traffic to pay the bills with advertising.
Markos Moulitsas Zuniga (left, from his site) revealed this today on his site, Daily Kos, but I am NOT making a political point here. The most successful conservative sites, from FreeRepublic to Lucianne.Com to Andrew Sullivan, all do the exact same things.
For all the hoo-ha over blogging it's important to put the "industry" into its proper perspective.
A recent item at Daily Kos, one of the more popular political Web sites, did this very neatly.
The purpose of the chart was to show Kos edging past a rival site, Instapundit. But for our purposes it's more illustrative to look at the left side of the scale, unique visitors per month.
You ever leave a pot of coffee on the counter too long? I have. After several days it starts tasting really funky, and these nasty white organisms start partying on the top of it. (BREW logo from Vayusphere.)
Well, that's what seems to be happening to Qualcomm's BREW development environment, in which Verizon is demanding all applications on its cellular network be written. There's no circulation in a proprietary environment . If the creator doesn't apply regular heat (and risk that nasty, metallic taste) things are going to get funky fast.
The U.S. newspaper industry is cutting itself off from the Net, putting registration in front of users before letting them read stories.
They're doing this because they can't make money from advertisers until they can convince advertisers who they are reaching. That's what they say, anyway.
Me, I find there are very, very few stories written in any U.S. newspaper that I can't find somewhere. Most papers get by on a mix of AP and syndicated copy, with a few kids rewriting press releases or listening to police radios for flavor, and a crank in the back writing political screeds.
But there are exceptions. If you don't like forced registration, but you want to get into these sites, here's how.
Bank of America agreed to buy National Processing (that's their logo, from their home page), a major credit and debit card processor, for stock worth $1.4 billion.
National had been 83% owned by a bank anyway so this doesn't really change the balance of power between "independent" processors and "bank" processors.
The fact is big banks have been taking this territory over for years, at increasingly high prices. It's part of a general consolidation of banking in the U.S., and that's what we should worry about.
My very first editor at Rice, Steve Jackson, took O'Reilly's Clue after graduating. Instead of finishing law school he went to his first love, board games, and started a company to make them.
His first hit was called Ogre. (This image is from Goingfaster.com, a gaming enthusiast and Jackson fan.) At a time when the big cost of producing games was making, and printing, all the cardboard game pieces, Steve cut costs in half by having one player take one piece, the Ogre.
Spam does not just hurt the spam-ee. It is also destroying the spammers, their customers, and the entire effort to turn e-mail marketing into a legitimate business.
The reason isn't in your cluttered inbox, but in a simple falsehood. The falsehood is that spam costs nothing. (The picture is of a good book on writing for direct marketing, which you may buy here.)
Everyone believes this lie. Spammers certainly believe it. Their customers believe it. So, too, do those brand names that run "e-mail marketing campaigns."
More important, so do very legitimate marketers engaged in very legitimate double opt-in e-mail marketing campaigns.
Even legendary marketers are failing to understand this Clue. Let me give you an example.
Some say people are asking about me. Others say they have information to share.
Registering for this site provides no real insight on what's going on, and the site is hawking "premium memberships" that, in the absence of hard data, sound like a scam.
Feel free to use the comment thread if you know anything. Your comments are still not being posted (owing to comment spam) but I will give you a personal reply.
Good movie. Thumbs up and all that. Fun for the whole family. (The image is from Cinepop in Brazil.)
The Dreamworks picture is breaking all sorts of box office records. And the use of technology is astounding. I actually recognized Jennifer Saunders (as the Fairy Godmother) before she spoke -- computer animation has gotten that good.
But the theater where we saw it was practically empty. Now, this was a matinee, and the movie was playing on six of the theater's 18 screens. But the place was empty.
This got my spidey-sense tingling. (Sorry, wrong movie.) Let's just say it made me think.
Google is trying to reclaim the high ground in add-in software through redefinition.
It's doing this in a good cause, namely its own. It wants to keep enhancing its Google Toolbar. It wants to add new features that use cookies and caching and your web logs to personalize what the Internet does for you.
But whatever its own motives, others are using the same concept in far more sinister ways. They push pop-up ads that block others' sites. They steal data on your Internet usage and sell it. Or they hide what malware inside their packages.
All this infects the credibility of every software vendor, including Google.
Way back in high school, nearly 35 years ago now, I lost my first newspaper job. (The illustration is from a Buddhist temple. Cute, huh? Keep reading for enlightenment.)
Well it wasn't a job, actually. I was canned from the school newspaper, along with the rest of the staff, after some editorials appeared against the Vietnam War.
Most of the "old" staff did what you expect. They went to their parents and got the money to distribute their own paper, one that was just as slick as the regular paper.
I took a different route. I went to the market. I sold ads. I kept my costs down and generally broke even. Kept it up for nearly three years.
The lesson stuck with me. Begging isn't a business model.
I associate this lesson with conservatism, but in our time it's often ignored. Young conservatives have an easy time getting money -- from parents, from foundations, and from publishers more interested in propaganda than truth.
Simmons, rap's Barry Gordy, told CTIA last Tuesday that the industry should forget about data for a while, and concentrate on making its voice service better.
I don't know if you noticed it, but there is a Central Planning aspect to Moore's Law. (The chart, found on a University of Vermont server, is credited there to Smart Computing 1999.)
By making economic change predictable, Moore's Law lets a chipmaker set a five year plan, from a central office, and even (unlike the Communists) execute to it.
I well remember an early-1990s keynote from then-Intel chairman Andy Grove, in which he talked about making the "686" (they weren't using the name Pentium then) at a plant in Ireland. Intel does indeed have facilities in Shannon, and the Pentium II came out precisely as envisioned in the speech.
While "Bet-A-Billion" Bill Gates is sometimes (mistakenly) compared to Henry Ford, he himself recommends Sloan's own autobiography as the best book about business you could ever read. (The picture is from a University of Chicago Press page selling "Sloan Rules," by David Farber. It's a better picture of Sloan than on the current edition of the autobiography.)
If you can't find a publisher (and most middle-list authors can't any more) then you can publish yourself.
I published my Moores Law book, "The Blankenhorn Effect," (right) all by myself. While the results to date haven't been financially thrilling, all it took me to get going was $1,000, which was reasonable.
Now the price has plunged. Borders is trialing a $200 price point in some Philadelphia stores. For another $300, you get an ISBN number and the store in question stocks five copies.
Short stories are very, very powerful. They can, when done right, pack the punch of a novel into just a few pages.
But short stories have nearly disappeared from most writers' repertoirre because of business models.
A century ago the best short story writers worked for newspapers. O. Henry was a newspaperman. (To the right is the cover for the Japanese edition of this.)
Ever since O. Henry's time, however, markets for short stories have been drying up. There was a vogue for "pulp" magazines, from which modern science fiction emerged, and a few publications, like The New Yorker, still buy a few. Once a writer becomes established they can pull their old short stories out of a drawer and make a book out of them. Some, like Orson Scott Card, even lend their names, their sensibility, and their editing to whole collections of short stories in book form.
But that's rare. There is, on the whole, nothing between the "heights" in the short story format and the "dregs." There's no way to make a living there. You either write novels or you go hungry.
I'm not complaining. I'm simply stating that business models, or the lack of them, can control what we read, see and hear. What's true in fiction is also true in music and movies.
But, as we're seeing, maybe not in music any longer.
For two generations now the business model in music has revolved around the album. The format moved easily from vinyl to CD. Singles were created to sell albums. Albums had arcs. Listeners might complain, at first, "why am I buying 10 songs when I only care about one," but after they played the thing enough times they were usually satisfied.
Musicians, meanwhile, issued albums the way novelists released books. Every year or two your favorite artist had something new in the stores, new hits on the radio, and fans would add this to their collections. Concerts became "live albums," and for those who only wanted to hear one or two songs a year, there were "greatest hits" collections.
Apple's iTunes (the illustration is by Jason Schneider of iLevel Designs) has made this start to break down. Suddenly there is a business model for singles that people might accept. How long before an artist, say one not tied to the old system but popular nonetheless, starts releasing singles on a monthly basis? They can sell the singles now, through iTunes, and sell the collection later, when they're all hits.
One more interesting point that is often missed. The Apple iTunes site has a book store. Prices range from $3 to $16 per book.
But how about a short story, a new one, from someone you like, at, say 50 cents? How about if Apple started giving these stories away, to folks who registered for an online "book club?" Sure, at first you'd just see popular novelists in there, name-above-the-title brands. But a contest, say (an online answer to "American Idol") might bring new people into the mix, short story specialists whose work we'd pay for.
I use analogies all the time here at Mooreslore. I prefer historical ones.
But I also know that, while patterns repeat leaving Clues in their wake, that history never repeats itself exactly. Karl Rove may compare his boss, George W. Bush, to William McKinley. This does not mean Mr. Bush need fear Buffalo, New York. (Although come to think of it, Tim Russert does come from around there...)
But analogies can be over-done. Such is the case, I fear, with John Dvorak's latest column, reprinted at ABC News today.
Dvorak's headline calls the ethics of music distribution a complex issue, but his analogy is overly simple. It's the story of a kid with candy. Is it OK if you take my candy, should I leave it lying about, he asks. Is it OK to take it if the other neighborhood kids all say it is?
(The image above, by the way, is a computer fractal print, by Jeanne Brickman of Elmhurst, Illinois. If you like the image, consider buying a copy here.)
The trouble with the analogy is it isn't accurate. The first kid actually stole the candy, with the help of a big brother who's a lawyer. And it's not candy we're talking about, but the soul of a writer, a singer, an artist, that we're talking about. Not only that but the candy isn't even real. We're talking about a copy of the candy. There's just as much candy in the bowl after the "theft" as there was before. Someone left it out in the rain, and the "victim" (the record company) fears it may never have that recipe again...
The kid with the candy, in this case, wants to be paid any time any other kid eats a piece of that kind of candy. And the kid got the candy recipe by forcing another kid, who made the candy, to fork it over, saying he was the only one with access to all the world's other kids, and a candy maker without candy eaters is nothing more than a sugar hoarder.
Now does it matter that the kid with the candy got the recipe by controlling access to all the other kids, and that the kid who had the recipie for the candy is only getting paid on, say, every 20th piece of candy, and then with "expenses" taken out? Does it matter that the contract between the kid with the candy and the kid who made the candy stipulates that not only this candy recipe, but all future candy recipes, will be held by the kid, under the same onorous terms? Does it matter if the kid with the candy recipe is hungry, while the kid who got the candy with him under these forced conditions has more bling-bling than a Detroit pimp?
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.
Slate has another of those 
Spam is back in politics.
Verisign CEO Stratton Sclavos is a big investor in incumbency. And he gets value for money.
Info-Tech has a release out that says 
A few years ago some wags talked about people having a "right" to Internet service, and they got laughed at. 
Everyone hates spam. But there has been no political constituency potent enough to fight the well-organized 
Disney.
Richard Wingard has figured out a way to fund cutting-edge technology with angel investors, and hold them in their investments for nearly 7 years. (The picture is courtesy the 
The news business is going to try cracking down on the Web this year.
Of all the dumb-ass things Michelle Malkin has ever written (and she does it deliberately) this is the one that got me mad:
While you're all tucking into your Christmas turkey the hype machine for the next round, the 
The eBay Myth is that you are somehow safe there.
What motivates a blogger most? (Image from the blog of 
It's a crazy notion that is going nowhere.
For the last few days I've been needlessly obsessed with a study I found at 
This month Atlanta lost 
In 
The Always On medical market 
America's biggest tech companies are focused today on the problem of creating, not technologies, but platforms.
The folks at 
One of my biggest problems with the whole podcasting "phenomenon" is the shortage of good aggregation tools.
Evaluating blog traffic has always been a dicey proposition.
What's in a name? 
The launch of so-called Open Source Media (no, they're not open source, in fact they try to keep people from even using fair use quotation through a EULA, don't get me started ) is proof that a Blogging Bubble is well underway.
There's a lot of hyperbole there. (Patrick Henry, right, was nothing if not hyperbolic.)
One of the strangest aspects of the post Bell break-up era has been the continuing Bell fascination with content.
Two press releases came in today and demonstrated to me that the biggest problem we have in this world right now is a lack of ethics.
One word: branding.
The hidden flaw, or Achilles Heel, of scaled technology systems like Amazon, eBay and Google is that the technology replaces human action.
A lot of people are (rightfully) upset over SBC CEO Ed Whitacre's recent statements dismissing the concept of network neutrality. 
A friend tells me that Eric Schmidt isn't really in charge of Google, that it's still Sergey and Larry's show. 
When Craig Newmark 
Deals like the 
The 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.
Internet businesses are easy to get into, easy to compete with, easy to replace.
San Francisco is
The 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 wrote something today suggesting that Dr. Eric Schmidt leave Google.
Back in the 1970s most people who were at the age I'm at now were convinced these "PC" things were going nowhere.
The movement of network boundaries ties together all the trends of the present time.
"I'll take Bubble for $100, Alex." (That's 2004 Jeopardy mega-winner 
After $2 billion, Rupert Murdoch's Internet strategy has become clear.
The folks at Google write that 
Over at ZDNet, Steve Gillmor
There's a saying that bloggers are journalists who won't make a five-minute phone call, while journalists are bloggers who won't spend five minutes on Google.
The fight has barely begun for control of the new Internet interface, the RSS reader.
Om Malik has a wise commentary today on how peer-to-peer services 
While using the Web to track Hurricane Katrina (
The fastest way to save energy in this country is to build-out the Local Web. (The illustration is from the 
Mark Glaser has an OJR piece up about 
Oil, like other commodities, is priced based on a contunuous auction, demand measured against supply. (The picture is from a primer on peak oil, 
Back in the 1980s, Wall Street played a game on Microsoft's duo of Gates and Ballmer, demanding "grown-up supervision" for the then 20-something computer software duo.
Two really stupid predications crossed my desk this morning. (The image is by 
Sam Walton was devoted, first and foremost, to his employees. (That's the cover of 
The big trend of this decade, in technology, is a move toward openness.
I believe that one of the cruelest businesses of our time are the so-called "payday loan" folks.
I'm a big fan of both 
That headline could have been written about me. (But let's see if I can't make it up to you right now.) 
Adam Penenberg channels 
Conservatives have long complained the press is biased against them. Lately liberals have taken up the same cry.
For people who like gaming, their games (or online environments) are their main interface to the Web. This has been true for some time, and unremarked upon.
Since I was handing out
It's nice when "real" (paid) market analysts agree with one of your premises. Especially when it's a key premise to you, as Always On is to me. (This is advertised as an Always On Server, 
I spent last week in Texas, dependent on free WiFi hotspots, and I learned a powerful lesson.
Former RIAA president Hilary Rosen finally gets it about copyright. 
We returned to the topic of e-commerce, and the effort to make money in journalism, with this week's 
Despite what 
My 
I've been a professional writer for over 25 years now. And what is most striking about the last few years, besides the rise of open source and blogging, is the rise of forced amateurism.
One of the most interesting ideas I heard at the recent Blognashville event was 
I'm generally all in favor of anything to fight spam. And regular readers of this space will recall how much I like my own anti-spam tool, 
You may remember him. Long-haired weirdo. Crazy hair. Counter-cultural kind of guy.
In last week's issue of my
Despite his ponytail and his sometimes counter-cultural language, despite being what I like to call a Truly Handsome Man (it's a brighter term for bald, people) Ted Waitt was always a follower, not a leader. (The picture is from 
B.L. Ochman 
Many think the secret of Fox' dominance of news is political. A generation brought up on the myth that an objective press is biased to the left, then given a right-wing Pravda, sees the latter as "fair and balanced."
The real difference between blogging and journalism is on the business side, not the creative. (That's Henry Copeland of 
The secret's out.
The strength of an economy, like that of a society, depends on social mobility. That means the poor can rise to wealth. It also means the wealthy can end up poor. (This old cartoon, from what folks like to call 
Why is it that politicians have done a better job on the Internet than publishers?
It's true. There are three kinds of lies -- lies, damned lies and statistics. (The picture is that of a statue of dramatist 
I have not written much about Voice Over IP in this space because I'm not an expert in it. (Yes, I hear you say, this never stopped you before.)
The secret to being a successful entrepreneur is learning how to handle NO.
The best way to understand the future is to look into how chips are changing.
In 
The success of Google has been based on the fact that technology drives its train. Technical success is the most-sought value. 
Want a career in the exciting, fast-paced world of 21st century journalism? 
The key benefit of open source is transparency. (That's a transparent Mozambique garnet, from 
Last month Intel's mobility chief 
One problem journalists have with blogging is it does away with gatekeepers.
There is a tyranny to having a narrow beat. (The image, by the way, is from the 
Like Kremlinologists of the past, people are now analyzing Google's every move the way they once followed Microsoft. 
I've seen the TV ads and maybe you have, too. "Get a free ringtone. Simply text (whatever) and get (name of hit song) as a ringtone!"
Here's an interesting juxtaposition of headlines. (The lovely idiot is from 
Both 
Eric Rice (left), responding to 
I have made few comments about the so-called conspiracy against the Apple iPhone.
In all the arguments over copyright and patents the interests of 
The big news in blogging today is not the 
You may have caught the nasty 
Whatever idiot at Agence France-Presse is pushing to keep its stories from being linked widely might want to do a re-think after reading this.
When a currency becomes overvalued it gets tossed like confetti. This is what happened in the late 1990s, and it's happening again. (The allusion, of course, is to the hit song 
This summer will be the peak of the Voice Over IP (VOIP) boom. (The illustration, by the way, is 
Over in New Orleans, the assumption at this year's 
The New York Times quotes a newspaper consultant as saying 
Note: The following was published today in my free weekly e-mail newsletter, 
Bill Gates has finally hired himself a new CTO.
Podcasting is the trend of 2005.
There's nothing journalists like better than a good old fashioned catfight. (The animated gif catfight is from 
With Bluetooth viruses causing all kinds of havoc, and forcing millions to close the open ports on their phones, it seems strange to be writing about a "Bluetooth Network" connection.
From 
Perhaps the most vital asset to any technology company today is its reputation.
A few years ago I speculated publicly about Sony buying Apple. (That's Sony chairman Nobuyuki Idei at right, 
It's nice when someone in the "major media" gets the Always On vision, no matter how they get there.
I'm fascinated with how Western technology filters into the developing world and changes lives.
Some big news went unnoticed last week .
Ever since the Web was spun I've been looking for a better way to track the news.
Now that 
I have written a bit on RSS here, often wrongly. (The illustration is from the blog of 
An ink-jet printer that makes gourmet food? 
Many companies re-sell cellular capacity. It's a simple branding exercise. 
It's not capitalism. Capitalism does not by itself guarantee competition. (Image from 
If the last several months proves anything, it is that there are many ways to grow in the cellular business. (
Word that mobile phone makers (and some networks) want to embed WiFi and VOIP into phones brings up a crucial point about the VOIP market, and about how technology works in general.
A "blogger" named "Oscar" has 
Well, it might if you subscribed to 
Hartmut Neven, who does research in computer vision at 
There's a good discussion going on at Dave Farber's list today, following a 
The Six Apart-LiveJournal merger is not a roll-up.
A few years ago Jackson, Mississippi was the center of the telecom universe.
For the last year I've been harping here on the subject of Always On.
The most dangerous word in telecommunications today is 
As a struggling artist I'm always on the look-out for new ways to make money. (That's Paul and Stan of the Housemartins singing for their supper in 1984, from 
When UTStarcom announced it had a "WiFi Phone" (right) no one noticed.
This reads like a contradiction in terms, doesn't it?
Over the weekend C|Net ran a story indicating the Mozilla Foundation hopes to 
A few months ago Forbes had a nice article on NTT DoCoMo's iMode service, and 
The enormous popularity of the iPod, and its dominant share of the market (some say as high as 95%) has created a new family fun game for reporters this Winter, which I call 
I'm dating myself here, but back in the 1970s, at Wiess College on the Rice campus, there was a four-square court. Four players, you bounce a dodge ball into one square or another, and the person who can't get it into another square on the bounce is replaced, with everyone rotating around. 
I've been looking up-and-down this proposed 
With many companies now substituting WiFi for wired networks, it's natural that those with multiple locations would want to 
There is a lot of 
Microsoft has launched an experiment in tightly-controlled liberty called 
The two brief items below are examples of a new feature here at Corante, called Blink.
The bandwagon on behalf of "Mobile TV" 
I was hammered here recently for a piece in which I warned of what I called 
Nokia's 
Russell Beattie (pictured) thinks he's figured out what mobility needs.
At a recent 
Remember 
I was late to Seach Engine Optimization (SEO). It seemed to me like a parlor trick. 
The online photofinishing wars were supposed to be simple.
Each time a member of my family needs any type of medical care I'm frustrated. (The image is from the good people at 
Michael Eisner would you please go now?
The secret to turning a blog into a financial success lies in the word community. 
For all the hoo-ha over blogging it's important to put the "industry" into its proper perspective.
The U.S. newspaper industry is cutting itself off from the Net, putting registration in front of users before letting them read stories.
I'm probably talking through my hat here.
My very first editor at Rice, 
Spam does not just hurt the spam-ee. It is also destroying the spammers, their customers, and the entire effort to turn e-mail marketing into a legitimate business.
I have been getting a number of notices lately from an outfit called 
I took the kids to see 
Google is trying to reclaim the high ground in add-in software through redefinition.
Way back in high school, nearly 35 years ago now, I lost my first newspaper job. (The illustration is from 
I am no genius, but in my field I'm smarter than some people.
I don't know if you noticed it, but there is a Central Planning aspect to Moore's Law. (The chart, 
To read the entry above you would think that the tech game is over, and America has lost.
If you can't find a publisher (and most middle-list authors can't any more) then you can publish yourself.
I love short stories.
Apple's iTunes
I use analogies all the time here at Mooreslore. I prefer historical ones.
