conflux
SatireWire
SOCCER-MAD U.S. CRAZED OVER WORLD CUP
"As World Cup fever grips the globe, nowhere is the mania for Earth's greatest sporting event stronger than in the United States, where 280 million soccer-mad Americans are on the emotional edge, unable to think or talk about anything else. As one zealous U.S. supporter explained: "World Cup... World Cup, that's... racing?"
Yes, the insanity is almost palpable."
11:26 PM 0 comments
News.Com
Enforcing laws in a borderless Web
"Certainly, conflicts over jurisdiction have been around for centuries, but the Internet introduces a new set of questions about how to apply cross-border laws. In the physical world, the ground rules are relatively well established, bolstered by years of international treaties, case law and agreements between specific nations that dictate how such laws are applied and enforced."
"But the Web changes the dynamics. When you put up a Web site, virtually anyone can stop by and shop. And often, sites aren't selling items but are merely posting speech that some might find objectionable."
"FOR MUCH of its life, the Internet has been seen as a great democratizing force, a place where nobody needs know who or where you are. But that notion has begun to shift in recent months, as governments and private businesses increasingly try to draw boundaries around what used to be a borderless Internet to deal with legal, commercial and terrorism concerns.
“It used to be that a person sitting in one place could get or send information anywhere in the world,” said Jack Goldsmith, a professor of international law at the University of Chicago. “But now the Internet is starting to act more like real space with all its limitations.”.""
redux [08.18.01]
"On the face of it, the Internet appears to make geography obsolete. But the reality is rather more complicated. If you want a high-speed digital-subscriber line (DSL) connection, for example, geographical proximity to a telephone exchange is vital, because DSL only works over relatively short distances. Similarly, go to retrieve a large software update from an online file library, and you will probably be presented with a choice of countries from which to download it; choosing a nearby country will usually result in a faster transfer. And while running an e-business from a mountain-top sounds great, it is impractical without a fast connection or a reliable source of electricity. The supposedly seamless Internet is, in other words, constrained by the realities of geography. According to Martin Dodge of University College London, who is an expert on Internet geography, "the idea that the Internet liberates you from geography is a myth"."
redux [04.02.01]
""All politics is local," the late Massachusetts congressman Tip O'Neill once quipped. It turns out that the old saw is also true of e-commerce.
Cruise by a Nordstrom in Seattle on a misty spring day and the beige mannequins might be wearing yellow raincoats and duck boots. Three thousand miles away in Boca Raton, the Nordstrom window might showcase dolls dressed in floral-pattern bikinis and sunglasses. But at Nordstrom.com you get the same sell whether you log on from soggy Seattle or sunny Boca.
That's because, in our rush to get online, we've forgotten that some of the rules of real-world selling still apply on the Web. Geography matters -- online and off."
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"But for auction sites, gambling sites and others, geography is becoming increasingly important, because they must treat people from different locations differently, as is the case with the French government's barring the sale of Nazi-related items to its citizens.
Online advertising companies, too, are increasingly desperate to use geographic targeting tools to reinforce their clients' faith in Internet marketing. In short, for a growing number of companies, this will be the year when the borderless Internet economy becomes an outmoded concept.
"Our customers told us over the past six months or so that it was an absolute requirement that we have geo-targeting," said Mark Joseph, chief technology officer for MediaPlex, an advertising company based in San Francisco."
redux [10.07.00]
"This project arose in response to one of the great myths or the Internet age, i.e. the coming of cyberspace heralds the end physical constraints which will eventually lead to the death of cities. In fact, the exact opposite is occurring. The largest concentrations of Internet users and producers are located in urban areas and many of the most innovative firms in the Internet space are housed in downtowns. There should be nothing surprising about this since, cities have always been the primary source of innovation and will continue to play this role in the future.
Although the power of the Internet does opens up new possibilities for long-range collaboration and even new spaces of interaction within cyberspace it also exhibits much of the traditional unevenness that has characterized urban and economic development throughout history. The fact that information can be easily and widely distributed is often mistaken for an indication that the production of this information is also diffused. In fact, there is a much more complicated dynamic involving the connection of specific places to global networks resulting in a system of production that is both place-rooted and networked at the same time.
8:24 PM 0 comments
The New York Review of Books
Popcorn Park
"Spider-Man looks like what it is, a work of large-scale industry. If you admire it, it's in the same way you might admire a World's Fair or a suspension bridge. The Amazing Spider-Man came up from the bottom; not many people were looking for original invention in ten-cent comics in 1962. Spider-Man, the movie, descends from above, trailing clouds of magazine covers and licensed toys, and thus has a ponderousness its model altogether lacked. The scenes of digitally simulated combat—like most scenes of digitally simulated combat—have little more life to them than the rapidly shifting arrangements of numbers on the screen of an electronic calculator. Not for one moment do we believe that any entity is colliding with any other entity: the heft of actual being and actual contact is replaced by a terminally weightless play of microdots."
"We saw a cultural and generational coup d'etat this month, at least in cinematic terms -- if we were watching. Star Wars was challenged by millions of rebellious kids, who decided to choose a new kind of myth. The next generation unseated its elders -- as is the right of every generation - and is making its own culture, moving away from ours. In doing so, these kids balked at mega-hype, rediscovered earnestness, simplicity, the love story, some patriotism, punctured a billion-dollar balloon, and maybe even sparked a (relative) movement away from whorish sellouts, back to simpler story-telling. I, for one, sure hope so.
The evidence: In its first four days, Star Wars: Episode 2 -- Attack of the Clones sold nearly $117 million worth of tickets. When Spider-man opened two weeks earlier, it earned $115 million in just three days."
12:21 AM 0 comments
Online Journalism Review
AOL Time Warner: Time to Grow Up, Fast
"Let's forget our stock portfolios for a moment and focus on something that's much more significant over the long haul: the vitality and independence of the news outlets at the world's largest media company.
What impact has the merger had on the news operations of the world's first Internet-powered media company? How is this game of media monopoly affecting the players -- the journalists, the readers, the public?"
redux [04.01.02]
"As AOL Time Warner Inc. stock sank last week to the lowest level since the companies announced plans to merge two years ago, the biggest merger in corporate history looked more and more like the biggest blunder.
"The merger of AOL and Time Warner was "an absolute mistake," Berry said. "The only reason it went through is that this was during the silly times in the market. Otherwise, there was not a chance in hell.""
redux [01.24.02]
"Only six months ago, the merger of AOL and Time Warner was reshaping the media industry, for two main reasons. First, because of its size: it was more than twice as big as its nearest rival, Viacom, and everybody else was scared of being trampled under the sheer weight of the new group. And second, because AOL Time Warner seemed to be redefining the nature of media itself, through its fusion of old and new. At that time, most activities of other big media groups—whether News Corp’s obsession with snapping up DirecTV, a satellite broadcaster (which, for now, it has failed to do), or the attempts by Vivendi Universal, a French media giant, to secure distribution in America (which it has done)—could be explained by their need to stand up to AOL Time Warner..
Today, however, things look a little different."
redux [12.06.01]
"Old media officially took control of new media within the world's largest media company Wednesday, when CEO Gerald Levin unexpectedly announced his retirement. By selecting former Time Warner executive Parsons as his successor less than a year after the AOL-Time Warner merger, Levin disproved many assumptions about the direction of a company conceived at the height of dot-com power--and about the role of the Internet in creating a brave new world of media. Essentially, the establishment neutralized the revolution.
"In its role in a diversified media company, the Internet has a place as does any other medium," said Mark Mooradian, an analyst at Jupiter Media Metrix, commenting on the significance of the power transfer. "The Internet is simply another one.""
redux [07.08.01]
"Like its earthly manifestation, which also encompasses portions of Rockefeller Center eight blocks downtown and AOL's digs in Dulles, Virginia, the intangible cultural sprawl of AOL Time Warner is also vast and diverse. With content spanning much of mainstream music, movies, television, magazines, and other media; with access to the distribution of cable and online services; with some 90,000 employees including some 17,000 at Time Inc. and CNN; and with a combined customer base 130 million subscribers strong, the new company is dealing with the convergence of old media and new on an incomparably large scale. Because of its sheer size and the strength of its news brands, CNN and Time Inc., the forces and patterns set in motion by AOL/TW may well affect everyone in journalism -- in print, on TV, and in the evolving online frontier."
redux [03.09.01]
"In the Time Inc. division, which is the largest magazine outfit in the U.S., concerns are multiplying faster than staffers initially imagined. Some at Time Inc. are increasingly wary that the magazine business could be threatened by AOL?s lack of journalistic savvy and the huge pressure to meet AOL Time Warner?s extremely aggressive financial goals ? including increasing cash flow 30 percent this year ? amid an ever-deteriorating advertising climate."
"AOL Chairman Steve Case?s answer: The pressure would force people to abandon old ways of thinking and forge new relationships across its various units."
redux [02.21.01]
"From the Web's beginning, in 1995, a debate has simmered over the ethics of online journalism. Most established media have maintained as clear a distinction online as they do in print between news and commerce. Pure dot-coms, by contrast -- and so-called portals, in particular -- have been willing, even eager, to pair editorial and sales in ways that aren't entirely transparent to readers.
"AOL's purchase of Time Warner and its Time Inc. publishing unit -- a prominent ASME member -- has, overnight, transformed the world's largest and most profitable dot-com company into the world's largest and most prestigious magazine publisher as well. It has thus moved the debate over the Web's journalistic ethics from the realm of the theoretical to the intensely practical. The issue is: Whose standards should prevail -- those of AOL Time Warner the publisher or those of AOL Time Warner the newsstand aggregator?"
redux [04.11.00]
"America Online's president sees home entertainment and communications as a collection of boxes. The TV set is the ''tell-me-a-story box.'' The personal computer - ''the manage-your-life box.'' The CD player? ''The give-me-a-mood box.''
The roles for those machines may be quickly evolving and the lines between them blurring. But Bob Pittman still sees plenty of room in American life for the newspaper out in the mailbox."
"In remarks that were part pep talk, part cautionary tale, he said practitioners of the written page can thrive in the new communications age if they are aggressive about getting their content online and don't defy a consumer-driven Internet culture that wants more and more at little or no cost."
redux [03.21.00]
"The choice of Sacks as primary attraction of a journalism seminar -- he's senior vice president and general manager of America Online -- was controversial enough to make one editor of Online Journalism stay home in protest. Yet it was strangely invigorating to hear this smug megacorporation executive lecture on his own importance, and how all journalists will play by AOL/Time-Warner's rules from now on, because, as Sacks said, "We're the biggest guys. We're big, and we're bad."
""If our goal was to publish bad magazines, by the way, we could have done that without a $120 billion merger." Before Sacks finished, he had happily proclaimed, "We do no original news," and described the new world of reporting as "an integrated consumer experience." Gives you an idea about how AOL might cover a famine."
9:34 AM 0 comments
News.Com
Why 3G should fear the wireless LAN
"To be sure, the technologies may be complementary, but might wireless LANs still whittle away at carriers' 3G revenue?
Wireless LAN operators in so-called hot zones can offer service more cheaply and won't be constrained by spectrum and infrastructure costs. As a result, it will be much easier for them to pass down lower costs to consumers. Cellular operators are trying their best to cut 3G launch costs, but they still don't have the ability to wage a mobile data price war--and won't be in any position to do so for the near future."
"Now, don't get us wrong -- we here at Unstrung are very excited about the many, many applications of wireless LAN technology. But talk of a combination of 2.5G technology and wireless LAN public access points supplanting 3G is just plain wrong, especially on the old continent."
"However, if carriers do start to roll out WLAN services, Unstrung will make one last bold prediction: You can kiss the idea of WLAN services being cheap or even free goodbye. Despite the fact that WLAN bandwidth is cheaper, carriers won't be keen to eat their cellular margins by offering an inexpensive alternative."
redux [03.17.02]
"Have you ever checked your e-mail over a high-speed Internet connection, while waiting at a bus stop? Have you ever chatted with your pals on the Net, using high-definition television? How about hooking your car up to the Internet so that someone knows where you are at all times? These feats are no half-baked visions of the future. Somewhere in the world, they’re being done right now.
THE SAME KINDS of people who brought you the Internet three decades ago — academics and military types, corporate gurus and pony-tailed geeks — are doing it again."
redux [03.04.02]"A growing number of localities have already decided to sidestep emerging third-generation cellular technology in favor of making creative use of wireless LANs.
Greg Anderson, director of IT for the city and county of Broomfield, Colo., said he plans to cut off his Cellular Digital Packet Data service from Redmond, Wash.-based AT&T Wireless Services Inc. because it's too costly and the data rates are too slow. And he said he has no intention of using the more advanced 3G cellular once he completes his industry-standard 802.11 wireless LAN, or Wi-Fi, installation countywide later this year."
[requires 'free' registration]
"Mr. Pozar, a radio engineer, is a member of the Bay Area Wireless Users Group, an active band of hobbyists who have been building free networks in communities through the region. Mr. Pozar and some of his friends have quietly begun obtaining the rights to place $2,000 wireless network access stations on the mountains and hilltops that encircle San Francisco Bay. If he succeeds, the network will be a starting point for a wireless data network that could eventually spread all over the Bay Area.
Significantly, what will set Mr. Pozar's planned Sunset Network and those like it apart from the commercial cellular networks now being constructed at great expense is that they will "self assemble" — expanding from one neighborhood to the next as individuals and businesses join by buying their own cheap antennas that either attach to the wired Internet or pass a signal on to another wireless node."
[requires 'free' registration]
"One of the site's supporters, a nonprofit group called nycwireless.org, recently persuaded the Bryant Park Restoration Corporation to jettison a plan to provide Internet cables in a small area of the park, in Midtown Manhattan. Instead, the restoration group will finance the installation of an 802.11 network designed to bathe the entire park in bandwidth this summer.
"We thought it would make people want to stay in the park," said Daniel A. Biederman, executive director of the restoration group, a private organization that oversees the park."
""The goal is to facilitate the free exchange of information," said Shand. But since fast internet access is a powerful draw for many people, the idea of free high-speed access from anywhere is what gets most people interested. "Democratizing broadband," as Shand puts it, is a good way to facilitate the free exchange of information.
The obvious questions, though, are "Is it legal?" and "Won't the ISPs get mad?""
"Despite the buzz over unplugged coffeehouses, free community networks and war driving, jacking in to the wireless Net is still next to impossible. Even in cities like New York, Seattle and San Francisco where public wireless projects are prevalent, working access points are rare. Technology writer Mark Durham, currently in the process of mapping all available Wi-Fi nodes in San Francisco, says you're better off looking for a pay phone. "I've got about 105 listed," he says. "But that includes Starbucks."
If there's one technology that doesn't need evangelizing, it's wireless Net access. But while there are some start-ups out there, such as EarthLink founder Sky Dayton's Boingo, that may succeed in leading us to the promised wireless land, there are also plenty of prominent failures."
redux [02.12.02]
"NPR's John McChesney visits Aspen, Colorado, where entrepreneur Jim Selby has set up a wireless network that gives residents quick access to the Internet. Selby has put directional wireless antennas on about 40 homes in the hills surrounding Aspen, so nearly the whole town can receive signals that provide his free wireless Web connection. To form the network, he uses a WiFi (why-fy) transmitter. A new company called "Boingo" makes software that would enables wireless access to WiFi service providers across the country. (6:11)"
redux [11.27.01]
"It’s an increasingly common scene: a telecommuter perched on a park bench, pecking away at a laptop. But a peek over her shoulder reveals a more startling sight: she’s surfing the Web, outdoors and cable free.
Anywhere, anytime Internet access is gaining ground across the United States as wireless networks owned and run by their users spring up in more cities each month—25 at last count."
"Wireless hotspots using public access local area networks in airports, hotels and even on Japanese trains may face temporary problems like the rest of the telecoms industry. But the mid-term predictions are for massive growth. And as Clive Couldwell point outs, they will not only be an increasing threat to mobile operators but also provide plenty of opportunity for fixed-line operators and isps to add some mobile services cheaply."
"Mobile operators should certainly be worried. The combination of no licence fees - because they operate in the unlicenced 2.4 ghz band - relatively cheap and easy installation, a wide and growing potential customer base and high-speed connectivity - offering data rates of up to 11 mbps to wireless-enabled laptops or handhelds within 50 metres of any access point - means that these wireless hotspots will spread ever faster across the world."
"Fast Internet access over small wireless networks in restaurants, hotels and airports will soon start hurting telecommunications operators, a new survey found Monday.
More than 20 million Europeans will use some 90,000 open Wireless Local Area Networks (WLANs) by 2006, market research group Analysys said. Today there are up to 20,000 WLAN users, most in the United States."
redux [08.26.01]
"AN UNDERGROUND MOVEMENT to deploy free wireless access zones in metropolitan areas is taking hold. If it turns out to be successful, wireless network operators may be fighting against a grounds-up movement that could undermine their multibillion-dollar campaign to offer next-generation 3G (third-generation) wireless services in major metro areas.
The movement, called by some the "parasitic grid" and by others more simply the "free metro wireless data network," has already installed itself in New York; San Francisco; Seattle; Aspen, Colo., Portland, Ore., British Columbia; and London."
redux [04.14.01]
"Permit me to throw a stick of dynamite in the room: Third generation, or 3G , wireless is dead before it was even born. And after billions wasted on 3G, it's going to be replaced by free wireless local area networks, or LANs.
A technology that the cell-phone industry is spending untold billions on, 3G promises to deliver high-speed data precisely where you don't need it -- on your phone. On the other hand, homes, offices, coffee shops, airports and hotels are building out cheap and grass-roots wireless local area networks that deliver even higher-speed access where you do need it -- your personal digital assistant and your laptop."
redux [09.09.01]
"Burton subscribes to the term "Open Network Access Point," believing the scale that could be achieved by widespread adoption of wireless access point would be amazing.
But as with many stories, there is a dark side. Both Burton and Pozer agree individual providers of these access points, which can cost as little as $150, must be aware of the legal implications."
""The Internet has always been revolutionary," Burton said. "What you're seeing now is the old school revolting.""
"That was funny. I laughed and laughed. It doesn't feel very parasitic every month when I pay my DSL bill. There's nothing parasitic about a community network. The bandwidth is paid for. People are taking their existing connections and letting other people share it. There's nothing new.
I think what has people scared is that, as I know and others know, bandwidth is significantly oversold. If everybody wanted to request their 384 kilobits or their 1.5 Mbps at the same time, you'd have the same thing happening that you had in the twenties with the run on the banks. The infrastructure can't support it, even though it's sold as such. I think that's where the fear is coming from on the telco side."
redux [08.15.01]
""This is why I love New York," says Anthony Townsend, standing in the middle of Washington Square Park, holding his laptop computer like a butler's tray and scanning the adult playground the place becomes on hot summer evenings. Where else, he asks, can you walk around with a computer, surf the Web, and go utterly unnoticed?
As if to prove his invisibility, or perhaps to demonstrate that he belongs, he hoists his machine like some digital prayerbook and begins chanting: "Jesus! Jesus! Thank you!"
No one - not the guy playing the Ramones on acoustic guitar, not the tonguing teenage lovers - notices this modern miracle worker or the cybernet he has cast around them. Along with some 30 other volunteers in a group called NYCwireless, Townsend's on a crusade to set up wireless Internet access zones: small areas, often called free networks, where people can tap into high-speed connections, without cables or phone lines, at no cost"
redux [12.10.00]
"With its meticulously preserved rows of army barracks and offices, San Francisco's Presidio neighborhood gives off the illusion that it's still the 1800s, when it was a bustling spit-and-shine military base.
The wireless Internet antennas sprouting everywhere suggest something else: Today's civilian community is home to a very unregimented attempt to build a homemade wireless Web that seeks to rival the expensive plans of telecommunication conglomerates and other corporations."
""I use it in bed, at the cafe, in the car, on the grassy fields," says Brewster Kahle, a 40-year-old high-tech entrepreneur who lives and works in the area. "I'm living a wireless existence."
"Matt Westervelt and three of his friends had tinkering on their minds when they started building their own high-speed wireless network in June. Climbing on the roofs of their Seattle homes, building antennas and trying to make them work with Ethernet protocols sounded like fun. Plus, if the whole shebang actually worked, they figured they'd be able to access their home computer files from the local cafe, play Net-based games while sitting on each other's couches and stream video onto their personal data assistants -- all at speeds of up to 11 megabits per second, far faster than what cellphone operators or other wireless providers offered."
"Call it "the free-network movement" -- a bubbled-up-from-the-underground effort to spread high-bandwidth wireless connectivity everywhere."
11:18 PM 0 comments
Wired News
Tech Toxics' Tarnished Legacy
"California high-tech manufacturing companies are degrading the environment in developing countries, a new research report confirms.
Case studies done in Taiwan, Malaysia, India, Thailand, and Costa Rica by the California Global Corporate Accountability Project document water pollution and inadquate waste management resulting from component production."
redux [04.06.02]
"Americans will throw out about 10 million old computers this year. About two-thirds of these will be shipped to Asia for dismantling by rural villagers. The computers all contain mercury and lead, and the resulting toxic waste has become a threat to villagers' health and environment.
"A coalition of activists and lawmakers has been working to improve the situation, and in recent weeks they've gotten a signed pledge from electronic manufacturers in the United States to consider a new solution."
"Workers in Silicon Valley's semiconductor plants toil in head-to-toe protective clothing designed to keep impurities from contaminating the microchips. But Mother Jones magazine reports that the growing incidence of health problems among these workers suggests that it is they who need protection. At least 250 workers have filed lawsuits against high-tech companies, charging that the toxic soup of chemicals in production areas has triggered high rates of miscarriages, birth defects, and cancer."
redux [05.04.00]
"Behind the well-paid geeks in cubicles and the sharp-dressed entrepreneurs is an industry that consumes as many resources, uses as many lethal chemicals, and generates as much toxic waste as some of the worst culprits of the pre-Internet age. And both industry workers and the people who live near the plants are feeling the effects: the toxins damage aquatic life in the bay, poison drinking water, and, increasing evidence suggests, kill high-tech industry workers.
While the federal government, local agencies, and hundreds of thousands of Bay Area residents and company workers are dealing with the computer industry's mess here in America, the same (or worse) problems are spreading worldwide."
9:05 AM 0 comments
NPR: All Things Considered
Merrill Lynch Settlement
"NPR's Beth Fertig reports that Merrill Lynch has agreed to settle charges it misled investors with inflated stock ratings. The nation's largest brokerage firm will pay $100 million to New York and other states. The settlement follows a 10-month investigation by New York's attorney general, who uncovered embarrassing emails in which Merrill Lynch analysts made negative comments about the very same stocks they were recommending to the public. (3:30)"
"But will individual analysts take a fall? History suggests they won't. White-collar criminals almost never pay out of pocket or go to jail. The reasons go deeper than just the ability of analysts to hire the best lawyers. According to experts, American capitalism at the turn of the 20th century does a great job of encouraging entrepreneurship and risk taking but lacks an effective mechanism for punishing those who go too far. The two predominant legal responses -- the criminal prosecution and civil class-action suit -- continually fail to do the job."
"The real skinny is that virtually no one who matters in the investment industry -- which is to say, portfolio managers at large pension, mutual and hedge funds -- ever took nine-tenths of research reports seriously. Only the public did. As I explained in my book Online Investing, analysts at the major brokerages for years have been looked down upon by institutional investors as sales support staff, a pack of kids with fancy college degrees who provided little more than PR material for the retail brokerage and investment banking teams. If they were called "promoters" rather than "analysts," the public would have had a better idea of their role in the retail investment ecosystem. The funds have their own, unbiased, independent staff analysts."
redux [04.19.02]
"It should have been the "big-freaking-surprise" story of the year, and yet we still find ourselves shocked at the cynicism and self-interest of Wall Street's equity analysts. We have known, and yet not known, that analysts commanded enormous salaries based in no small part on their ability to drive investment banking business to their companies. After the Attorney General of New York's inquiry, we know for sure, and the truth is as bad as we imagined."
redux [04.10.02]
"At the height of the technology bubble, Henry Blodget and other Internet analysts at Merrill Lynch & Co. issued glowing reports about companies that would later crash, while privately deriding the stocks to one another in salty, dismissive language.
One company given a top rating by analysts was described in-house as "a piece of junk." Another was called "such a piece of crap," even though analysts in Merrill's Internet group told investors to buy more of it for their portfolios. One analyst worried that regular investors "are losing their retirement" because of the misleading advice."
redux [08.21.01]
"There is something a bit disingenuous about this legal assault, which is, after all, mainly about people who lost money speculating in the stock market. Some are suing because they couldn't get shares in initial public offerings at the offering price; others are suing because they got the shares and lost money on them. Federal regulators and politicians are suddenly shocked - shocked! - to discover that conflicts of interest are rampant on Wall Street.
Still, with $3.3 trillion up in smoke since the Nasdaq hit its peak in March 2000, it's hardly surprising that the people and institutions that helped engineer the epic Internet bubble are being called to account. And for the technology finance industry - which was transformed by the Nasdaq's boom from a relatively obscure West Coast offshoot of Wall Street into a major source of growth and profits for top-tier firms such as Goldman Sachs, Morgan Stanley, J.P. Morgan Chase, Credit Suisse First Boston and Merrill Lynch - it's going to be a painful reckoning indeed."
redux [07.19.01]
[requires 'free' registration]
"Investment banks, whose analysts were touting stocks with overwhelming zeal even as the stock market started crashing, are now trying to rehabilitate their images. Last week Merrill Lynch , by some measures the world's biggest investment bank, declared that except under strictly monitored circumstances, its analysts would be prohibited from holding shares in the companies they research. The goal is to remove any incentive for them to boost a stock to ensure their own enrichment. But this novel policy will not entirely prevent conflicts of interest from arising. It should be regarded as a springboard to a more complete revamping of the relationship between publicly available research and investment banking."
redux [06.27.01]
"Wall Street analysts are known for a lot of things--being too optimistic, failing to warn investors about the dot-com crash, and being the latest target for Congress--but they usually aren't known for their apologies."
"Morgan Stanley analyst Jeffrey Camp cut Exodus to a "neutral" from "strong buy" and gave his clients an apology.
"There are few moments in my career that rival this one in its difficulty and unpleasantness. Elbert Hubbard said, 'The line between failure and success is so fine, we scarcely know when we pass it.' But passed it I have, and it is time to own up," Camp said."
redux [06.11.01]
"As pundits rush to explain what happened on Wall Street, fingers point to the thought leaders. We read exposés on Mary Meeker and Frank Quattrone--once dubbed geniuses--and wonder how they could have sponsored initial public offerings for the nth online grocer or women's portal. Or we ask ourselves how stock analysts could ride a stock all the way down from $150 to $3, all the while touting it as a "strong buy.""
"These are people who were supposed to be making smart decisions. How did they get it so wrong? The answer is, they didn't. "
redux [05.10.02]
"And yet, as compared with previous bubbles -- say, junk bonds in the '80s -- the dotcom fiasco owed relatively less to Wall Street's lack of ethics and relatively more to willing contagion by the public itself. "The market wanted these stocks," Blodget observed to CNBC, and Blodget was right. By the millennium's waning months, it was common, for example, to see engineers in Silicon Valley with CNBC in one pop-up window on their computer screens and their brokerage accounts in another, and they would -- or so I'm told -- trade all day and scarcely attend to their jobs.
Of course, the financial press -- CNBC in particular -- fanned the flames, but faulting it or any other group misses the epidemic nature of the contagion, which naturally infected the whole of society without distinction."
redux [03.13.01]
"Henry Blodget, Wall Street's loudest cheerleader for Internet stocks, made it to the front page of the New York Times last week. And thereby hangs a tale about the media and the bubble."
"For it was the mainstream media -- which now take such delight in scolding those involved in the dot-com mania -- that helped push the idea that anyone could get rich by playing the market.
"The media invented Blodget," says Christopher Byron, a columnist for Bloomberg News and MSNBC. "In a bull market everyone loves to cheer, and Henry Blodget was everyone's first phone call. . . . Where were they when companies were trading for 150 times revenues? They were repeating the words of these guys. It's disgusting."
8:36 AM 0 comments
The New York Times
Entrepreneurship Is Fun. Then There's the Day Job.
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"A growing number of people are poised to take that chance. Last year, roughly 8 percent of working-age Americans, or 13.5 million people, started businesses, according to the Global Entrepreneurship Monitor, an index of entrepreneurial activity in 40 countries that is compiled by Babson College in Wellesley, Mass., and the London School of Business. In 1993, about 4.5 percent of working-age Americans started businesses, according to Paul D. Reynolds, a professor of entrepreneurship at the two institutions and coordinator of the project, which last year surveyed 3,000 Americans ages 20 to 64.
During the start-up stage, about 65 percent of entrepreneurs have full- or part-time jobs, Mr. Reynolds said."
""It was very clear in my mind that entrepreneurs think differently," said Sarasvathy. "Anybody who has worked with entrepreneurs to any extent knows that there is something different or funny about them. So I started with that premise.""
"After analysis of transcripts from each individual, a common theme appeared. Entrepreneurs were not goal-oriented, rather they used the materials at hand to create opportunities. Sarasvathy compares this to a chef, who instead of working from a set recipe, combs the cupboards looking for ingredients in hopes that something tasty can be created."
"Entrepreneurs are entrepreneurial, as differentiated from managerial or strategic, because they think effectually; they believe in a yet-to-be-made future that can substantially be shaped by human action; and they realize that to the extent that this human action can control the future, they need not expend energies trying to predict it.".
9:07 AM 0 comments
NPR:Weekend Edition
China Dawn
"Scott Simon talks with writer David Sheff about his new book, China Dawn. Mr. Sheff writes about dot-com entrepreneurs and the rise of the internet in China. He says the internet is a threat to authorities and a catalyst for change in China. (8:30)"
redux [04.16.02]
"A decade or so ago, it was all clear: the Internet was believed to be such a revolutionary new medium, so inherently empowering and democratizing, that old authoritarian regimes would crumble before it. What we've learned in the intervening years is that the Internet does not inevitably lead to democracy any more than it inevitably leads to great wealth.
The idea that the Internet itself is a threat to authoritarian regimes was a bit of delusional post-Cold War optimism."
redux [03.21.02]
"Mao once said, "Political power grows from the barrel of a gun." The entrepreneurs in China Dawn seem to want to change the last phrase to "ISP access."
But their enthusiasm betrays a streak of naiveté. As Tiananmen so amply demonstrated, in China today, political power still grows from the barrel of a gun. And the prediction that the rise of the Internet will liberate Chinese from authoritarian rule is far from certain."
"One notable loophole in the content watch list are weblogs. Weblogs are content websites maintained by ordinary users that can act as introspective online diaries, soapboxes to rant opinions, and a vehicle guide the horde of Internet users to swarm to other obscure links to be found on the net. They are easy to update, cheap to maintain, and difficult to block because so many new ones appear each day. They utilize a client relationship with a server and can be updated with a simple browser."
The bureaucrats and censors in China who block and monitor websites will be hard pressed to try and control the future flow of weblogs both in and out of China due to the number and diversity of this new information platform. Having met actual Internet content censors from China, they are decent people but come from a different time and different place in terms of technology. They don’t really get it yet since weblogs remain a concept difficult for them to understand for now."
redux [08.08.01]
"It is widely believed that the Internet poses an insurmountable threat to authoritarian rule. But political science scholarship has provided little support for this conventional wisdom, and a number of case studies from around the world show that authoritarian regimes are finding ways to control and counter the political impact of Internet use. While the long-term political impact of the Internet remains an open question, we argue that these strategies for control may continue to be viable in the short to medium term."
"In this paper we illustrate how two authoritarian regimes, China and Cuba, are maintainng control over the Internet's political impact through different combinations of reactive and proactive strategies. These cases illustrate that, contrary to assumptions, different types of authoritarian regimes may be able to control and profit from the Internet. Examining the experiences of these two countries may help to shed light on other authoritarian regimes' strategies for Internet development, as well as help to develop generalizable conclusions about the impact of the Internet on authoritarian rule."
redux [06.19.01]
"Singapore's Deputy Prime Minister has warned the internet threatens democracy and people's sense of patriotism.
Lee Hsien Loong says governments must find new ways to build a consensus on national issues and strengthen national identities."
"The internet "opens up societies and helps individuals link up with like-minded souls anywhere in cyberspace," he said.
But it "may weaken the bonds of place and circumstance that have always tied citizens to their home and nation," he added."
redux [10.26.00]
"The world is changing fundamentally. Images and information respect neither time nor borders. Hierarchy is giving way to networking. Openness is crowding out secrecy and exclusivity. Ideas and capital move swiftly and unimpeded across a global network of governments, corporations, and nongovernmental organizations. In this world of instantaneous information, traditional diplomacy struggles to sustain its relevance."
"Nations once connected by foreign ministries and traders are now linked through millions of individuals by fiber optics, satellite, wireless, and cable in a complex network without central control. The Internet, with 100 million users today, will reach one billion people by 2005 and will be available to half the world's population by 2010. The network will become the central nervous system of international relations."
redux [10.10.00]
"Metaphors, symbols and sayings are mighty mind-setters. They captivate our minds and focus our attention to one main point, effectively excluding others. Putin used the burning of the Ostankino television tower, once hailed as a symbol of Soviet supremacy, as a metaphor for the desperate economic need of Russia. The global media played along with this tune, once again showcasing images of Russia's decay. But there is another largely untold story to be extracted from Putin's metaphor: TV towers are more than symbols - indeed they are very concrete centers of mind control, distributing the flow of information and entertainment."
"Who chose the crumbling Berlin Wall as the icon and metaphor for the breakdown of communism and the end of the Cold War? Wouldn't a TV tower in flames be more accurate? It wasn't about the free flow of capital. It was about the free flow of information."
3:01 PM 0 comments
BusinessWeek
Giant Steps for a Software Upstart
"A lot has changed for Linux in the past two years. True, the basic tenets of the rebellious open-source software-development movement popularized by coder Linus Torvalds remain largely intact. Loosely organized collectives, often from competing companies, collaborate to build software products that no one owns, with source code that anyone can view and alter. Any changes in the code are held by the community at large.
While such idealism worked fine in academia and among uber-geeks, it wasn't immune to market economics as the movement matured."
redux [12.09.01]
"The nexus of open source development appears to have shifted to Europe over the last ten years. This paper explains why this trend undermines cultural arguments about "hacker ethics" and "post-scarcity" gift economies. It suggests that classical economic theory offers a more succinct explanation for the peculiar international distribution of open source development: hacking rises and falls inversely to its opportunity cost. This finding throws doubt on the Schumpeterian assumption that the efficiency of industrial systems can be measured without reference to the social institutions that bind them."
redux [12.03.01]
"How will IBM make money on free software? The idea is to use Linux to not only sell expensive computers but also high-margin software and big-ticket support and consulting services. Because nearly 60% of IBM's revenue comes from software and services, Linux plays into IBM's business model better than any other computer maker's. IBM believes the new sales will greatly exceed any revenue loss incurred from giving away the Linux operating system. Consider MDS Proteomics, a Toronto-based drug-research company. MDS bought a Linux supercomputer from IBM to do complex chemical calculations. MDS CEO Frank Gleeson says 50% of its multimillion dollar deal with IBM went toward consulting services and software, while the rest was spent on hardware and a joint-development effort with IBM researchers."
"Turning to the subject of Ximian Connector, I asked if Ximian expected flamage from the community for selling a proprietary software package. He replied, "We expect less than we would have expected awhile ago. I think that people understand that businesses have to survive. And the people know that the bloody carcasses of Open Source companies line the horizon right now.""
redux [11.21.00]
"The ideological purity of the open-source software business is being diluted by a new era of pragmatism as start-ups adjust to the economic slump."
"Where is our business model if everyone else can copy it?" asked Holger Dyroff, former CEO and now director of sales for Linux software seller SuSE. "The question is where we can make money now. Nobody cared about profitability two years ago."
"The new thinking often involves a proprietary product that has been built on top of an open-source foundation--a situation that could be considered the best, or worst, of both worlds."
"How to make money with the GPL. How to promote and spread free software. How open source's experience advantage with developers gives companies a competitive edge. Sleepycat President and CEO Michael Olson shows us what happens when free software meets intelligent business strategy."
"I love open source. I love what it stands for and I love the fact that as a connected society we've perfected the concepts surrounding 'division of labor' to such a degree that we're now afforded both the luxuries and opportunity to do what we want for the sheer enjoyment of it, even if that means coding into the wee hours of the night! I love business, I love creating them and working with people to run and fine-tune them. I especially love making money, whether it be for business, myself or others. Money has afforded me the freedom to pursue my other passions in life: travel, thinking, writing, creating and oh yea, partying! Most of all, I love it when I get to put all my loves together... all at the same time!
Must all mis amores live separate lives? Can't they just get along? I think they can. I think they will."
"Software pioneer and MIT research affiliate Richard M. Stallman has been named as a co-winner of the 2001 Takeda Award for Techno-Entrepreneurial Achievement for Social/Economic Well-Being."
"Stallman has been recognized for his work leading the GNU operating system development project, and for starting the free software movement. GNU is an acronym for “GNU’s Not Unix,” a reference to the fact that the popular Linux operating systems actually operate off of GNU."
"Stallman hopes that software companies will eventually shift their source of income to custom software, support, and custom installations rather than proprietary software. “It is not impossible to make money from free software,” Stallman said."
"On November 5, 2001, IBM announced its donation of $40 million worth of tools to the Eclipse project. Eclipse, a fully functional software development environment that is written in Java, and that runs on both Linux and Windows, is intended to solve many of the problems of tool interoperability faced by developers of conventional tools."
"As analysts from the Hurwitz Group concluded, the move is consistent with IBM's commitment to Linux and growing tradition of incorporating open source code into its product lines: "With its experience with the open source application server Apache, and the Linux operating system, it makes sense that IBM would now move to provide the developer community with an open source development platform. The challenge for IBM and the Eclipse organization will be to draw strong and broad tool-vendor support to advance the platform, and to demonstrate that it is truly an open platform that enables straightforward tool integration to make it worthwhile for organizations to adopt. In addition, Eclipse needs to capture and enlist the efforts of the developer community at large, to test and refine the platform and add their innovation."
"This paper analyzes the evolving economic substrate of the open-source phenomenon. We first explode some prevalent myths about the funding of program development and the price structure of software. We present a game-theory analysis of the stability of open-source cooperation. We present nine models for sustainable funding of open-source development; two non-profit, seven for-profit. We continue to develop a qualitative theory of when it is economically rational to be closed. We then examine some novel additional mechanisms the market is now inventing to fund for-profit open-source development, including the reinvention of the patronage system and task markets. We conclude with some tentative predictions of the future."
redux [04.02.00]
" Open source is good for business. Now I should add that open source is not for everything in software. We have a very large and successful software business, and we're going to retain that. But open source is great for infrastructure code. The reason is that to make open source work, there has to be an overlap between the people who care about the software and the people who make the software better. As you get further up the application stack, those two groups become disjointed...so the software that checks you into a hospital will never be open source because the people who care about that can't write software."
9:09 AM 0 comments
MIT Technology Review
The Rules of Innovation
"The management of innovation today is where the Quality Movement was 20 years ago, in that many believe the outcomes of innovation efforts are unpredictable. The raison d’être of the venture capital industry is belief in the unpredictability of new businesses. A few ventures will succeed; most won’t, the VCs say. They therefore place a portfolio of bets, extracting premium prices for their capital in order to earn the high return required to compensate for the risk that unpredictability imposes. I believe, however, that innovation isn’t random. Every undesired outcome has a cause. Those outcomes appear to be random when we don’t understand all the factors that affect successful innovation. If we could understand and manage these variables, innovation wouldn’t be nearly as risky as it appears.
The good news is that recent years have seen considerable progress in identifying important variables that affect the probability of success in innovation."
redux [02.07.02]
"The whole story is about motivation. The leaders in every industry have vast resources at their disposal. If I try to grab a piece of real estate that the established leaders want, where the customers are attractive and the business is attractive, the evidence is overwhelming that the leaders will win. So what I want to do is to craft a strategy that takes advantage of what I would call asymmetry of motivation. That is, a situation where I'm motivated to go after the business of the market leaders, but the piece of their business that I can most naturally go after is the one that they're the least motivated to defend.
Remember that when a new idea emerges in an established company, it needs to get funded. And the only ideas that get funded are those that help the established company make more money. That process favors the ideas that create improved products for existing customers, and tends to reject more innovative, or disruptive, ideas. That is what creates disruptive entrepreneurial opportunities."
redux [01.21.02]
"The path to success involves staying a little ahead of the competition but close enough that customers can still understand your product and incorporate it into their lives and businesses. I recently conducted a survey of 785 tech company executives to find out why some succeeded and others did not. I found that newer companies (started after 1980) were much more likely than larger, established companies to cite marketplace barriers -- with customers that were not receptive or ready -- as a primary obstacle. Human behavior is much slower to change than technology.
Years of research shows that the innovations most likely to take hold are those that don't demand excessive change from the customer. Incrementalism -- represented by the following eight characteristics -- is key."
redux [01.08.01]
"The problem isn’t figuring out how to get people to become more “innovative”; it’s figuring out how to get people to accept and apply innovations more productively. The glut of new ideas has paradoxically created a critical shortage of the human ingredients that determine just how quickly and cost effectively they get used.
So instead of celebrating the “heroic brilliance” of innovators, this column will explore innovation from a different and more important perspective. After all, it is customers and clients—not innovators—who determine how great ideas become successful innovations."
redux [10.25.01]
"Everybody thinks that it's the market pioneers who have the best name recognition, the highest market share, and the most enduring market leadership....Right?"
"Our discoveries may surprise the business community. After exposing the limitations of prior studies that extolled the success of pioneers, we find that pioneers mostly fail, have low market share, and are rarely enduring market leaders. In addition, we found that the current trend of staking everything on getting there first all-too-often leads companies to embrace a disastrous strategy of rushing to market with incomplete, inferior, and flawed products."
redux [05.03.01]
"In many ways, the Smartphone's evolution is a classic story of high-tech innovation within a big company. It starts with a small team of engineers at Qualcomm Inc. in San Diego, who were given a hazy but intriguing mandate. Gradually, they came to believe that they could produce a breakthrough product -- even if outsiders were dubious. Repeated crises erupted along the way, including a near-death experience in February 2000 when their division was sold to the San Diego subsidiary of Japan's Kyocera International Inc. For a while, it appeared that no one wanted the Smartphone project to continue. Yet the engineers pressed on in skunk-works fashion, improvising solutions as needed, until they emerged with a product that attracted enthusiastic mobs at trade shows, media events -- and even the passenger lounge at Chicago's O'Hare airport."