Umair Haque / Bubblegeneration
umair haque  


Design principles for 21st century companies, markets, and economies. Foreword by Gary Hamel. Coming January 4th. Pre-order at Amazon.

Tuesday, August 31, 2004

A new theory (requires free subscription) has surfaced (apparently based on evidence) to explain the "Tunguska event" which occured in Russian Siberia in 1908.

-- dhd // 8:57 PM // 3 comments


War on Terror Butlerian Jihad

Pipe-bomb blast at stem-cell research lab in Boston.

-- umair // 4:33 PM // 1 comments


Replication Wars

Engadget interviews Valenti.

-- umair // 3:01 PM // 0 comments



These guys are debating what Bush's favorite rhetorical tactic should be called:

" I called Karen and asked her why she was saying this, and she had this almost Orwellian rap that she laid on me about how things she�d heard � that I watched her hear � she in fact had never heard, and she�d never heard Bush use profanity ever. It was insane.

I�ve obviously been lied to a lot by campaign operatives, but the striking thing about the way she lied was she knew I knew she was lying, and she did it anyway. There is no word in English that captures that. It almost crosses over from bravado into mental illness."

Uhh...guys...this is what the rest of the world calls The Big Lie. Wake up. Why do you think they don't teach us history in (public) school anymore?

Here's another example.

-- umair // 2:52 PM // 0 comments


-- umair // 2:30 PM // 0 comments


Alex Halavais takes up Mike@techdirt's experiment to hack Wikipedia by introducing false info.

Interesting, but kind of irrelevant - it's pretty clear that the economics of open-source anything depends on reputation and trust; both of which will be increasingly important as these mechanisms get gamed. How far off is real Wikispam? As the value of Wikipedia increase, as it's been doing, spammers will try to establish prop rights.

-- umair // 2:26 PM // 0 comments


Very nice piece about measuring media concentration and why the HHI doesn't capture the value most attach to plurality in media. Highly recommended.

-- umair // 12:44 PM // 0 comments



Tiffin carriers. I could use one right about now.

-- umair // 12:34 PM // 0 comments


The Beeb asks if vinyl will disappear. won't - because to guys like me, tinny music on MP3 is not a substitute for the warmth of music on vinyl. In fact, they're complements.

Now, people like me aren't the mass market obviously. But the growth rate in my segment is really, really high; and so this is a niche that is the future of music demand, not the past. This is not a paradox to anyone under the age of 25.

Nice quote, though:

"..."Record companies used to be run by record lovers, providing some amazing packages," he said. "Now they're run by accountants."

-- umair // 12:05 PM // 3 comments


You have gotta be kidding me. The Beeb has an article about Gartner's Hype Cycle, which I think is kind of not cool, because it's just a restatement of the most simple innovation dynamics with a bit of cosmetic surgery,

-- umair // 12:01 PM // 0 comments


New iMac. I think this is a singularly uninspired and totally uncool design, but ymmv.

-- umair // 12:00 PM // 1 comments


Can someone explain to the NYT that the term 'unsanctioned demonstration' is fundamentally opposed to, umm, the United States Constitution? Thanks.

-- umair // 11:57 AM // 0 comments


Genome Economy

Synthetic life - Sciam article from a month or two back. Worth a read.

-- umair // 1:32 AM // 0 comments


Hydrogen Economy

"...Supramolecular complexes created by Karen Brewer's group at Virginia Tech convert light energy (solar energy) into a fuel that can be transported, stored, and dispensed, such as hydrogen gas.

The process has been called artificial photosynthesis, says Brewer, associate professor of chemistry. "Light energy is converted to chemical energy. Solar light is of sufficient energy to split water into hydrogen and oxygen gas, but this does not happen on its own; we need a catalysts to make this reaction occur."

Link. Interesting.

-- umair // 1:27 AM // 0 comments


2000 (1957 version)

Air-conditioned jackets. Finally!

-- umair // 1:25 AM // 0 comments


Gartner predicts India to lose outsourcing revenues. Blah, blah, blah - arbitrage is a zero-sum game.

-- umair // 1:24 AM // 0 comments



"...What do we get in return for granting TV stations free use of our airwaves? Unfortunately, when it comes to coverage of issues important to our nation, the answer is less and less."

That's what an FCC commisioner says.

-- umair // 1:21 AM // 0 comments


I am completely obsessing over Battelle/Mayfield's Sell-Side Advertising, which is the coolest idea I have heard for ages.

I have the intuition that the economics of this model is absolutely spot on, and I'm trying to give it a bit of structure (and a pricing mechanism).

Note it incorporates the idea of viral revenue streams like in my network licenses.

-- umair // 1:17 AM // 0 comments


Coordination Machines

Finding college roommates is a lot more riskless than it used to be. And there's probably a lot less upside as well.

-- umair // 1:15 AM // 0 comments


Niall Ferguson thinks a Bush reelection would be bad for conservatism - like John Major bad; it might essentially kill the party. I think Niall is great at sounding huge alarm bells, just like this one.

-- umair // 1:12 AM // 0 comments


A bit about Orion, who hope to create personal supercomputers, aka cluster workstations.

I'm not sure if this is aligned with consumer needs in the long (long) term - I think it's the Net that needs to provide data crunching capability. That means real data crunch, not just simple database manipulation. Think about how difficult it is to build (or view) even a serious graph on the Net.

Of course, Orion's target market is professional users of scientific workstations. The problem is that this market is relatively small, and it's not clear whether global growth will happen. Still, it's big enough to make Orion a nice chunk of $$.

-- umair // 1:03 AM // 0 comments


Utility Function

Sewer divers.

-- umair // 1:02 AM // 0 comments


Release the Photos

There are more and worse Abu Ghraib photos. The Post has the entire disc (as do others). Sy Hersh has talked about them. I would like to see them. Would you?

Someone should set up a website. I would, but I'm (honestly) too chicken, because I don't want to get clockwork gitmo'd.

Aside - this is why I think the Dems are missing a big opportunity. Coordination machines do things. Blogs are only information machines - they filter things. Now, there are many different kinds of filters. But they can't multiply action like coordination machines can. would be a nice example of a coordination machine.

-- umair // 12:55 AM // 1 comments


Freedom --> Slavery

"...The Justice Department has opened a criminal investigation and is demanding records regarding Internet postings by critics of the Bush administration that list the names of Republican delegates and urge protesters to give them an unwelcome reception in New York City."

Link. Voter intimidation is only really voter intimidation when it's anti-GOP. What a surprise.

-- umair // 12:52 AM // 0 comments

Monday, August 30, 2004

The impending doom threatened by self-replicating nanorobots transforming the planet into "grey goo"???

-- dhd // 9:06 PM // 0 comments


Our grand children will likely be taught these principles in grade school. However, it's kind of exciting (from a nerd point of view) to be alive in a time with so much innovation (mind you, it could be argued that being alive at anytime in history would satisfy this criteria, except for the dark ages of course.) Check out one application of quantum theory that will ensure the quantum memory in my quantum computer in the year 2050 won't get away with spontaneously switching a 1 to a 0 (i.e. memory error correction). ... and no, they haven't figured out how to construct Scotty's transporter...yet. Damned Heisenberg compensators!

-- dhd // 8:11 PM // 0 comments


A good article on some of the issues and benefits of adopting an open spectrum policy. It reads more like a manifesto, but still addresses some key questions including some previous issues discussed on bubblegeneration.

-- dhd // 8:02 PM // 0 comments


The recent iTunes Music Store's Volume Discounts is interesting. The individual customer has been serviced; the new "individual" is businesses. I like this positioning. B2C, now B2B. Which means Apple will now be spreading its Fairplay/AAC in 10,000 or 25,000 lots, minimum. A clever way to progress the audio-codec format of choice from non-DRM'd mp3 to DRM'd aac (albeit crackable, but that's beside the point). Get someone else (or some aspiring business, promotion, what-have-you) to spread the "currency" for you. Jobs noted that iTMS's competition was not other EMD services, but piracy. At this rate, to compete with iTMS does an EMD have to act like a pirate? A little weed is starting to seem like the only option....

-- matt // 11:47 AM // 0 comments

Sunday, August 29, 2004

This fascinates my Linux-geek side : all hail the arrival of GmailFS. Wow!!! Like really, wow!!! I think the Google strategy wonks are doing an exceptional job of entrenching the platform.

-- Mahashunyam // 7:05 PM // 0 comments


Creating infrastructure for the Bottom of the Pyramid (BoP) : Refuting objections to a Global Rural Network (GRNet) for developing nations. This is an example of how infrastructure directly aimed at the BoP may look like. I think there is a huge potential for disruptive ideas in addressing the BoP.

I think CKP has only discovered the demand side of the equation, and explained how to create strategy around meeting it. However, I think the economics of the BoP can go much farther. There's an entire eco-system of government, infrastructure, platforms, markets and applications waiting to be built here. I think we need to use technology and policy as key drivers to bring the BoP into a value-chain intermediated by strong market mechanisms. The BoP can hugely benefit from the efficiency gains brought about by this.

These market mechanisms will need strong infrastructures and regulatory environments to operate in. This makes me think that scope for innovation in creating these environments is much more than what CKP has alluded to. We need to think of creative ways of building, funding and operating such infrastructure. Above all, we need to fundamentally re-think the designing of the infrastructure, policy-making and regulatory apparatus to make it specifically suit the unique needs of the BoP.

I recently came across a pretty cool example of what some of this may look like. The Rural Infrastructure and Services Common (RISC), addresses "The problem of the economic development of large underdeveloped economies present unique challenges that require innovative solutions." Here's their concept paper (sorry, it's in MS-Word .doc format).

-- Mahashunyam // 5:24 PM // 0 comments

Saturday, August 28, 2004

Random acts of browsing lead to interesting reads....

Started reading this blah blah on outsourcing at ACM Queue from slashdot, got pointed to this cool entry on Parable of the broken Window over at Wikipedia, which finally led to a couple of old favourites from Bastiat : That Which is Seen, and That Which is Not Seen and Petition of the candlemakers. Did I mention that I think Bastiat is, like, one of the coolest economists ever?

-- Mahashunyam // 5:17 AM // 0 comments


How to profit from Open-Sourcing software - nothing entirely new. Basically, how big is the project owner's ego? In other words, are they hiding some sort of implementation know-how they feel gives them an advantage over other kinds? And have they measured the difference between this "know-how advantage" and the edge they would get by quickly increasing their user base while also increasing switching costs? Hello first-mover advantage?

-- matt // 4:23 AM // 0 comments

Friday, August 27, 2004

The successful integration of optical disc technology and holographic recording technology

-- dhd // 9:59 PM // 0 comments


Do you ever get the feeling that people who design and manufacture weapons like this one, were once (or still are) avid video game junkies. This thing looks like something straight out of Perfect Dark or Halo.

-- dhd // 9:54 PM // 0 comments


Blogging has allowed nearly anybody to become an amateur publisher. Bored with being restricted to just text? ....vlogging has arrived.

-- dhd // 8:41 PM // 0 comments


Strategy decay : HP enters Consumer Electronics. Note to Carly : copying every move that Dell makes will not make HP successful.

-- Mahashunyam // 8:15 PM // 0 comments


Does anybody really want to learn to type again? If you ask me, the ergonomic keyboards were bad enough, but this one handed (PDF; via Gennum) keyboard puts a new spin on things. Really, I'd rather be able to talk to these things and get them to write it down. Better yet, I'd like to be able to think it, and get them to write it down.

-- dhd // 4:11 PM // 0 comments


With the (slow) move towards hydrogen power, the water economy is coming. However, the relative disparity in the earth's stores of fresh water means that we either develop cheap efficient desalination solutions, or countries like Canada (with abundant fresh water supplies) will become the next middle east. Note: people point out that water, unlike oil, is available to anybody. This isn't quite true. Similar to the cost of drilling for oil, there will be a water processing cost involved to produce the hydrogen. Scarcity might still be an issue.

-- dhd // 3:58 PM // 0 comments


Why revenge feels good. The results are probably not a shock to anybody, as the article points out. The problem I have with these type of studies is they don't take into account (or look at) higher thinking. So your dorsal striatum lights up when you start contemplating revenge just to remind you that it would be a highly enjoyable course of action. What I find more interesting is: what causes you to actually take out that revenge or decide not to? What parts of the brain are lighting up when you're contemplating the outcomes and making your decision. And, assuming this happens, is there a pattern in people who are essentially impulsive and do not go through this type of thought process.
In a somewhat related note, I think these petscans could be used to help us teach better. Studies of the reaction of the brain to being taught new things could allow us to better construct our teaching structure and patterns. This could apply to anything from learning to skate to how your brain interprets quantum physics. Not sure how feasible this is at the moment, but I'm going to copyright it as well ;). You owe me (a large) cut if you make any money off this...I'll be watching.

-- dhd // 3:28 PM // 0 comments


I'm sorry, but this is just screwed up.

-- dhd // 3:27 PM // 0 comments


I would agree with everything you said below IF I had agreed with your premise. I don't. First, 'owning' spectrum is a misnomer. You can't actually own spectrum. You can be given a license to transmit in a certain frequency, but you don't own. Anybody could interfere with your broadcasts if they wished, with only the fear of legal ramifications. Granted, you can broadcast in a certain frequency all the time continuously, thus hogging the spectrum (essentially UWB floods large portions of the spectrum, however it uses techniques such as OFDM to keep things working). You can't however broadcast in all spectrum all the time, unless you have a very fancy multi-in multi-out type transceiver. Besides, current battery technology wouldn't let you use this type of power. On top of this, the whole thing would be pointless because anybody can broadcast at that same frequency and at that same time resulting in the degradation of your signal. Spectrum is finite, simply because there is a range and power within which we can broadcast and not cause nasty side effects like cooking everything in the broadcast path. However, within this range, the spectrum is infinite (considering time). The point of cognitive radio technology is it actually negates anybody's ability to "squat" on or own a piece of spectrum. The smart devices will see this spectrum as not available, and find the next white hole, which invariably must exist. A more effective solution to the economics of spectrum is to have a system where by the smart devices themselves negotiate for spectrum, with automatic transactions. For example, if you want to send your powerpoint project in to work from your pda, the pda will negotiate with various providers (cell, Wi-fi, or whatever else exists), and then pick the cheapest and most efficient alternative based on what it has learned about your needs and habits.
My point here is the spectrum itself will become a commons. The real economy will be in helping you get the information off wireless and on to the wired backbone.

-- dhd // 3:15 PM // 0 comments


Wow - quite a link over at DeLong's. No kidding, go read (more politics - a long series of emails between an Arab student and an American prof from 2003-now).

-- umair // 12:50 AM // 1 comments

Thursday, August 26, 2004

Dave (aka dhd), below, agrees with Shirky that spectrum should be deregulated, and points to a future of smart devices that will intelligently juggle spectrum.

I disagree - I think this is a technically possible future, but an economically improbable one.

First, let's start by noting that, in the real world, spectrum interference is currently an issue (as my panoply of interfering machines tell me). So spectrum is, as far as I can naively tell, scarce - perhaps not as scarce as the FCC says it is, but certainly, still scarce.

So, second, I can't imagine a scenario where firms incentives' are to build machines that juggle spectrum nicely with other machines - I can only imagine the opposite; the incentive to build machines that try and co-opt as much spectrum as possible. That's because in a Shirky world, you're always and everywhere better off owning more spectrum than not.

So simply deregulating spectrum would have all kinds of costly consequences - spectrum squatting, spectrum litigation, etc, etc. Basically, it would encourage a whole new range of spectrum rent-seeking strategies aimed at eating as much spectrum as possible as soon as possible. Think about the current patent thicket strategies that non-innovators like IBM are resorting to right now in order to stake their claims in idea space.

If we really want to think about this economically, we should seek to balance the costs of non-productive uses of spectrum against the benefits of productive uses of spectrum. That is, to make it expensive to simply hold spectrum. The most obvious solution is to trade spectrum credits which have some kind of time value attached to them, just like bandwidth is (was) traded.

So, here's an absolute monster of a business model - to be to spectrum trading what plays like Arbinet are to bandwidth trading. If you have the resources, the time, and the balls - it would be a hell of a fun ride.

I copyright this and if you, your heirs, or your friendly local ibank tries to put it into action, you owe me 175% of the $$.

-- umair // 11:36 PM // 0 comments


The management thinking pendulum swings back to 'hardball' aka strategy as conflict, not strategy as competition. I wouldn't pay too much attention; ymmv.

-- umair // 11:26 PM // 0 comments


Politics of the Day (3) (Via Mefi). The Dems are so out of it they can't even get a similar effort together for Bush, which is fairly amazing (if expected).

We all know there will be some kind of October surprise - simple tactical thinking would tell the Dems to plan a counter-surprise, decoy, misdirection, intimidation, bluff, threat, blah, blah; they're incapable of that as well. We all know that the great civil rights movements of the 20th century are based on symbolic nonviolent resistance; the Dems can't get this together either. The best they can come up with is to challenge Bush to weekly debates.

Yeah, I know I'm kind of jumping to conclusions about what Dems may or may not want - I'd just like to make the point that, imho, their capacity for strategic thinking is probably less than my kid sister's. Actually, that's saying a lot, since she can kick my ass.

-- umair // 7:59 PM // 1 comments


Slate asks 'Why is Florida's Voting System so Corrupt' and takes a very long time to answer the question. I think the answer's pretty simple: nobody really cares. If voters (or Dems) really wanted to - if it was worth their time, effort, and money - they'd do something (but they don't). The price hasn't been high enough - yet. Maybe after November it will be.

-- umair // 7:45 PM // 0 comments


The First World is the New Third World

Hey, look, there's more and more poor and uninsured people around. I'm sure glad I'm related to Dick Cheney - oh, wait, I'm not. Sh#t.

On a more serious note, this is why I say democracy is worth more in the 3rd world than it is in the US - voters in the States seem to do a very nice job of ignoring reality, even when it consists of a boot stamping on their face - forever.

-- umair // 7:44 PM // 0 comments


Anti-Value Drivers

'Dude, Where's My Resale Value?' - American cars are at the bottom end of the resale value spectrum. Obviously - the income elasticity of demand pretty much mandates that you'll want more for your money than a Detroit crapmobile can give you if you can only afford to spend $20k on a car.

-- umair // 7:36 PM // 0 comments


The J neatly explains most of the drivers behind Korea's broadband explosion, and why we in the States (and Europe, and the rest of Asia, Africa, and Australia) got shafted. Yeah, you probably know this, but it's worth a quick review:

"...U.S. policies and outcomes are different. The 1996 Telecommunications Act set about to introduce local rivalry just as the Koreans were making their policy moves. But while the Act struck down state franchise phone monopolies, going to competition cold turkey was considered too harsh. Regulators attempted to ease the transition with ambitious network sharing mandates. These allowed entrants to use the existing phone network facilities at prices set by regulators. (The rules are typically referenced as "unbundling," as they allow new retail service competitors to use various pieces of an incumbent's network.) Determining these complicated terms and conditions has taken more than eight years. And in June, federal rules lapsed after being overturned by the courts, leaving the entire regulatory arrangement in limbo.

Korea avoided this path. KT's new rivals Hanaro and Thrunet (among others) were denied the opportunity to use KT's network to deliver signals the "last mile." They scrambled for efficient alternatives. By using fiber-optic capacity leased from a power company, cable TV lines, and new transmission facilities built from scratch, competing networks emerged and broadband services took off."

-- umair // 7:32 PM // 0 comments


Here's a piece about online dating that's filled with some very interesting numbers. I'd forget the analysis and think about what online dating 2.0 will look like if I were you.

-- umair // 7:30 PM // 0 comments


Hypercompetition to hit HDTV. Yeah, we know - it's the sad sad story of CE yet again, except it's even sadder, because now PC mfgrs are getting into the action, who, I think, will be disappointed by how fast their competitive advantage period disappears.

-- umair // 7:26 PM // 0 comments


David Friedman's posted a cool new paper:

"...The central thesis of this article is that, for contracts in cyberspace in the future, public enforcement will work less well and private enforcement better than for contracts in realspace at present. A secondary thesis is that while the factors that make public enforcement less workable in cyberspace will not apply to contracts in realspace, the factors that make private enforcement more workable will. Hence we can expect some shift from public to private mechanisms for enforcing both realspace and cyberspace contracts, although the shift should be larger for the latter."

This is essentially what our network licenses are about - massively multilateral contracts that are private mechanisms to redistribute the gains from replication. ( Dad).

-- umair // 7:18 PM // 0 comments


'Consumer loyalty evades travel sites'. What a surprise! I would have expected massive price competition and yield management to create consumers who respect and love my business. (Uhhh...that's sarcasm).

-- umair // 7:17 PM // 0 comments


Anomic Society

Andrew Greely says 'America's Disease is Greed'. I would say greed in the absence of the social, like (real) social capital (not the kind we bandy about on social networking sites), is a big part of the reason why the States is so collectively unhappy. When the social breaks down, something must replace the void of ritual, norm, and tradition that's left - unfortunately for us, capitalism is a system of production, not a framework of meaning and belief.

-- umair // 7:11 PM // 0 comments


I find Vibrant Media's sponsored links irritating, mostly because they slow down the page I'm trying to read...a lot. Example.

-- umair // 6:26 PM // 0 comments


Rushkoff asks 'Does Wall St Get Wireless'? - and cites the lack of love from analysts and investors wireless plays are getting. I think it's more a case of imminent hypercompetition and serious business model uncertainty that's causing the lack of love - it's nice for geeks, but not exactly fun for (risk-averse) beancounters.

-- umair // 6:23 PM // 0 comments


What I Did While I Was Sick

1) Reread Stephen Baxter's 'Space'
2) Read Calomiris' 'Emerging Financial Markets'
3) Watched Schama's History of Britain

Also, got alerted to the fact that some folks are 'suspicious' that I registered Blogversations privately. Look, this is purely a spam blocking measure I use regularly.

Not to belabour the obvious, but since I launch all this stuff here, from my blog, which has my name in big letters at the top, in the title, and in the about section, it should be fairly obvious who's behind it ;)

-- umair // 6:18 PM // 0 comments

Wednesday, August 25, 2004

So the fellows at google are also bringing money into blogging. This technique uses the adsense system, familiar to gmail users, where a machine scans the text and creates relevant ads based on matching. Not to bite the hand that feeds me, but I think the blogversations system is far better for protecting the interests of the blogger and the blogosphere. Before I comment on this, I'd like to see if there are any comments from our readers regarding the differences and their relation to the blogosphere. Comment away...

-- dhd // 9:21 PM // 1 comments


I have a great deal of sympathy for the pains the IEEE is going through to set a standard for UWB. I can see how they want to ensure that the best technology is put forward with guaranteed subsequent compatibility, without allowing the dominant companies to dictate the direction of technological development.
Interestingly, the article brings up the VHS/beta events of the past. If the IEEE had gone through the same process for trying to establish a video cartridge standard, the whole thing would have been pointless. As it was, the market decided which was a better technology. Regardless of this, shortly after the demise of betamax, the development of CD and DVD technologies signaled the ensuing end of magnetic video devices as market dominators. I see the same risk for UWB. As this argument is drawn out (combined with the pace of innovation in wireless), UWB could be completely forgotten with billions in R&D thrown to waste. ...I'm sure megaultrafantasticwideband is already in development in some lab somewhere.
SO what's the solution? Develop both standards, and spend the time and money making the devices compatible with each other. I've pointed out before that if software was doing the radio signal processing here (ie modulation/demodulation) this wouldn't even be an issue.

-- dhd // 8:00 PM // 0 comments


Standards war continues to hinder the progress of Ultrawideband. Note to UWB folks : world is moving on to WiFi while you continue to waste time.

-- Mahashunyam // 6:25 PM // 0 comments


World's first Linux keyboard is here. Open the floodgates for more complementors, may the platform entrench deeper. Is this the (one of the many) first leap(s) across the Chasm towards a true mass market in Linux?

-- Mahashunyam // 5:25 AM // 0 comments

Tuesday, August 24, 2004

Today's pick for the luckiest person alive.

-- dhd // 10:13 PM // 0 comments


If I were the world's chosen dictator, part 2.

I'd make everyone read and understand the ideas of Ernest Becker. If we don't know what drives us then we'll never understand how we could tame it.

Thanks to my wonderful friend Tertium Quid (who is also responsible for creating my screen name - it's a private joke) who introduced me to Becker, I recently finished reading Becker's Escape from Evil. I found it to be a phenomenal piece of work in Social Anthropology. It is probably one of the most influential books I've read in my life. An absolutely essential read for anyone who cares to understand the world we are living in.

-- Mahashunyam // 9:42 PM // 0 comments


I never understood the tamagotchi pet craze. Isn't the point of technology to simply and enrich our lives? Granted this is a bit of an ideal, but when I have to start giving my electronic appliance undue attention just to get it to stop nagging me, I think it's time to pull the batteries.
This seems even more ludicrous. A virtual girlfriend upon "whom" you spend money and time, and what do you get in return? A computerized thank you, or a cold shoulder. Are these people trying to profit from some sort of strange masochistic subculture? The scary thing here might just work.

-- dhd // 9:18 PM // 2 comments


Linksys, Vonage connect on VoIP. Interesting strategy : investing in complementors. Does it create any new barriers to entry? Nope. At best, buys them some time.

-- Mahashunyam // 7:35 PM // 0 comments


MPAA continues its lunacy and sues chip-makers. Would you really miss Hollywood if it just disappeared?

-- Mahashunyam // 7:24 PM // 0 comments


A strong argument from Clay Shirky illustrating why the current system of EM spectrum licensing is stifling innovation and hurting the pocket book of the consumer.
Adding to his thoughts, with the realization of a spectrum management mechanism based on a smart cognitive radio (as opposed to the current dumb radio system), the need for licenses will be completely subverted as the devices themselves will determine, communicate about and ultimately share spectrum resources.

-- dhd // 6:39 PM // 2 comments

Monday, August 23, 2004

These two "projects" remind me of the great projects you had to build in the Civilization video games. 1) the ILC 2) the ITER . The difference being, of course, that in reality such insanely expansive undertakings could only be achieved by a consortium of countries (or possibly the Americans when they're not bleeding money fighting wars).

-- dhd // 5:05 PM // 0 comments


Why can't I be this guy? Oh yeah, I didn't invent a brand new way of sequencing a genome.

-- dhd // 3:55 PM // 0 comments


It's about time that video games went from my screen to my real world. Granted I could go play laser tag or paintball in a facility somewhere, but this is a lot cooler. I mean goggles that show when you've locked on to a target... portable head sets for team communication... what's coming next, the prox mine?

-- dhd // 3:38 PM // 0 comments


All work and no play gave Umair a big fat cold. More when I'm better...!

Until then, you can see what I read for fun today: Analysing the risk of global warming and applying it to carbon trading risk management (PDF). And Shaula sent this nice link about the history of piracy and it's parallels with info 'piracy'. It's pretty cool.

-- umair // 2:00 AM // 1 comments

Sunday, August 22, 2004

The Economic Impact of Abrupt Climate Change. Absolutely essential (if a bit dated) reading. Gives eco-entrepreneurs a bit of insight into the ceiling for the size of their market (aka the estimated worst-case capital stock destroyed by climate change).

-- umair // 9:31 PM // 0 comments


Politics of the Day (Carn't Sleep Edition)

A lynching in Alabama? I am far too burnt out to read this accurately, but you political bloggers probably should.

That's the biggie; here's some yawn-inducing run-of-the-mill First World is the New Third World Stepford Cheneys stuff: some poor lucky bastard got fired from his job for heckling Bush.

-- umair // 1:41 AM // 0 comments


I am kinda burnt out and bleary-eyed from Blogversations launch, so apologies if blogging below is less than coherent. Now I am gonna go crash :) !!

-- umair // 12:14 AM // 0 comments

Saturday, August 21, 2004

How Not to Analyse Tech Strategy, pt 341

"..."Search is not a business," said Allen Weiner, a research director for Gartner Inc., a market research firm. "It's a gigantic horizontal technology which they will have to continue to throw hundreds of millions of dollars at to make it strong."

...Weiner said Google should think of itself as a media company, saying Yahoo began a significant turnaround when it hired Terry Semel, a former Hollywood executive." I really need to say anything? Search is not business, nor a technology - it is, most fundamentally, an economy. That's what business models are built on: economics. Telling Google to Yahoo is like icing on the cake - who's been calling the shots in this industry, and forcing rivals to scramble to respond?

"..."They'll say to their dying day they are a technology company," Elliott said. "But 98 percent of their revenue comes from advertising." "

This the coup de grace. Note that this is exactly what consultants and analysts spent the 90s telling the TV and radio industry ('you're really in the ad industry'). Look where it's left them - with vital points massively exposed, and in fatal strategy decay. Why? Because it ignored the fundamental reality of their businesses: not alienating viewers and listeners in the name of ads is exactly what drives ads.

-- umair // 11:40 PM // 1 comments


Replication Wars

EFF wins Grokster case, Cory's got the details.

Look, I know this is somewhat heretical, and I think the EFF is incredibly cool, but the replication wars are over. We already won. The big question is: what will the next industry architecture look like?

Now, the media industry will use every bit of cash it has to litigate for a dead business model - until and unless someone proves there's a better way. Now, we all know there is - but no one's unlocked the new dominant design quite yet.

So what's happening here is curious: litigation makes potential investors wary of this space. So the rate of innovation slows down. At the same time, people spend less on movies and music. So the record industry is really creating a kind of prolonged agony for itself. Bizarre, to say the least.

The SuicideGirls ads are my main reason for visiting ole BoingBoing these days.

-- umair // 11:19 PM // 0 comments


Strategy Decay - Case Study

From 'Is VoIP Chump Change?':

"..."It's not going to, like, change my life," Dorman said. "This is going to be a couple-of-billion-dollars-a-year product. But you have to put that into the context of a $25 billion-a-year company."

Clearly, the question is not the size of the VoIP market - that will by definition be much smaller, since it is essentially a hypercommoditizing innovation. The question is how much of the $25 biliion VoIP will vaporize, or, if you like, how much it will shrink the pie (at least for AT&T).

These days, A $25 billion/yr company can become a $25 million/yr company with increasing speed. That's what hypercommoditization means. But to recognize all of this means stepping outside the usual frames of hidebound industry dynamics, and figuring out what's really going on. That's what decay is really all about.

-- umair // 11:12 PM // 0 comments


Textfiles is like an archive of the BBS scene. Very cool stuff here.

-- umair // 11:08 PM // 0 comments


Replication Wars

The RIAA's still at it:

"...A woman in Milwaukee and her ex-boyfriend are under orders to pay thousands to the recording industry. A man in California refinanced his home to pay an $11,000 settlement. A year after it began, the industry's legal campaign against Internet music piracy is inching through the federal courts, producing some unexpected twists."

If you want to be heard about this, check out Shake and Break and add your data. The only voice the industry will understand is cold, hard numbers.

If you think our method's not accurate, test it before you knock it - it's not as simplistic as it looks.

-- umair // 10:43 PM // 0 comments


Economic opportunity in environmental sustainability : Toronto Healthy House is self-sufficient in its water consumption (via Mefi). Wow! I am sure something like this in Vancouver or Seattle would be even more viable, given the higher average rainfall in the Pacific North-West. Note to Greens : the Market is your friend, not enemy. The only way such innovations are going to make it will be through the market mechanism for intermediating risks and rewards.

-- Mahashunyam // 9:28 PM // 0 comments


Business 2.0 interviews Prof Jagdish Bhagwati (Sub). Higly recommended.

I wish more economists would reach out to the Left to explain the role of macroeconomic policy and trade liberalization in poverty alleviation. Lately, I find myself engaging in deep discussions with my leftist friends, and it is striking to see how common our concerns are. At the same time, I find that most people do not have sufficient training in economic analysis to form well-reasoned opinions.

This makes me think that the Stupidity Tax we keep paying through our noses is just a result of our societies not being literate in economics. I cannot imagine that anyone reasonably well-versed in economics would ever support monstrous idiocies in public policy such as the War on Drugs in America.

Hmmm...if I were the world's chosen dictator for a day, I'd make it compulsory for every kid in every school to learn economics and its application to public policy. Not exposing citizens to the ideas of Bastiat, Ricardo and Smith is just too expensive for any society. It disturbs me to see that an entire generation of otherwise enlightened, well-meaning young people, especially on the Left Coast here in BC, think that trade liberalization is a *cause* of poverty, rather than its *cure*. Look no further than the link to Adbusters' take on economics posted earlier this week.

Why aren't so many educated, rational people in the West analyzing the historical experiments in economic principles, conducted at horrible human cost, in North Korea/South Korea or East Germany/West Germany? Why aren't they asking themselves why identical societies separated at a point in time in history evolved so very differently over the course of the next couple of generations just by following different socio-political and economic systems? Aren't they going to understand the economic mechanics of the miraculous poverty reduction going on right now in India and China?

-- Mahashunyam // 7:03 PM // 0 comments



Silly Dems, Malkin is nothing more than a decoy. Misdirection gets you guys every time.

-- umair // 12:21 PM // 1 comments


The Economist reviews C K Prahalad's views on profits and poverty. Personally, I believe this to be the most significant idea of the post-tech bubble era. Did I mention that I think CKP is brilliant?

-- Mahashunyam // 5:23 AM // 1 comments


An option trader's diary. Well, kind of - he's only trading 4x QQQ straddles!! If you don't know what that means...uhh.. it means he's not exactly betting the farm on something a really deviously cool trade.

Raises an interesting question - are the areas currently locked out of the blogosphere (ie anything non-geeky that makes serious $$$) going to join the fun? I doubt it, but this could be a leading indicator.

-- umair // 1:05 AM // 0 comments


More Google

Slate has an article called 'Four Ways Google Failed' (referring to it's IPO). The four reasons are mostly specious (it didn't netscape a bubble, vaporize 'evil' ibankers, prove the EMH, reform corporate governance).

I hate to rant, but this article really got to me. It just sounds so...European. The reason the States innovates is because even failure earns a reward. And, more to the point, success has a very serious reward.

In Google's case, there are many things it failed at - including doing my laundry. What it did succeed at is building a billion dollar business out of a few very simple and elegant thoughts.

Not to mention that the article contains some seriously wrong analysis:

"...What's more, yesterday some 22 million shares�more shares than were actually issued in the IPO�traded hands at an average price of about $100. So even though there were enough buyers willing to take the whole offering at $100, Google wound up accepting $85, leaving close to $300 million on the table."

Finance 101: The day after the IPO is not the IPO. Risk preferences change the day after the IPO. You cannot make this comparison at all.

Read Jamie Surowiecki's FT piece instead:

"...Wall Street can spin this however it wants. But Google went public without underwriting from a major investment bank, without handing out favours to well-connected executives and without dictating a price in the manner of Soviet central planners. Because it did, it now has hundreds of millions of dollars that it would not otherwise have had. By any standard, this was one IPO that worked."

-- umair // 12:51 AM // 3 comments



"...German men are being shamed into urinating while sitting down by a gadget which is saving millions of women from cleaning up in the bathroom after them.

The WC ghost, a �6 voice-alarm, reprimands men for standing at the lavatory pan. It is triggered when the seat is lifted. The battery-operated devices are attached to the seats and deliver stern warnings to those who attempt to stand and urinate (known as "Stehpinkeln").

"Hey, stand-peeing is not allowed here and will be punished with fines, so if you don't want any trouble, you'd best sit down," one of the devices orders in a voice impersonating the German leader, Chancellor Gerhard Schroder. Another has a voice similar to that of his predecessor, Helmut Kohl."


-- umair // 12:48 AM // 2 comments


Art of the Day

Diamanda Galas is an old fave.

-- umair // 12:40 AM // 3 comments


Interesting post by Gen suggests that Apple was more integrator than original innovator with the iPod. This is still a kind of innovation - architectural innovation. Problem is, it happens a lot less often than simpler kinds.

-- umair // 12:35 AM // 0 comments


How Not to Understand Blogging, pt 366

"...Like a lot of journalists, ClickZ's editors have been pondering the role blogs are coming to play."

Here's the rest. Basically, Clickz violates the Golden Rule of the Blogosphere - cite when you link - and then attempts to justify it using the NYT as an example. What a big surprise coming from Clickz.

This article is a great example of why innovation happens from the outside, or in what Ron Burt calls 'structural holes': because incumbents get trapped by inertia, tradition, hidebound thinking, narrow frames - and strategy decay.

-- umair // 12:12 AM // 0 comments

Friday, August 20, 2004

Does the growing unrest over Venezuela's elections serve as a prediction of what's to come in November in the States?

-- umair // 9:23 PM // 2 comments


Will Farrell does Dubya. The video is funny. The political stuff underneath it looks like "soft money" advertising (or anti-advertising), but it's that's ok with me.

-- dhd // 9:05 PM // 0 comments


Wired magazine has an article on the seemingly forgotten IPO from Nanosys. I'm not so sure about nano's immediate promise of a world replete with "nanobots" and "replicators". If you're a little more pragmatic, you'll realize that nanotechnology companies might start making money around the time your children start investing (assuming you're in your twenties).

-- dhd // 8:34 PM // 4 comments


You can read Robert Sawyer's vision of a what a day in 2014 will be like. I think it doesn't consider anything that's really happening in the world today (war, ideology, new kinds of economics, disintegration of cultures) - and so is just a simple extrapolation down the technology curve. Everything we know about the dynamics of innovation tells us this is not how technologies and cultures interact. YMMV. (Via /.)

-- umair // 8:27 PM // 0 comments


You know we've officially become a Big Brother society when the ACLU publishes reports titled The Surveillance-Industrial Complex. Cooperation between the private sector and government, great.

-- kh // 7:37 PM // 1 comments


Intellectual bankruptcy : America's War on Drugs turns to prosecution of physicians who prescribe painkillers. Everytime I think the Shrub and his chimps cannot possibly become any more stupid, they always manage to astound me some more. Our entertainer this evening is none other than the oh-so-lovable Mr Ashcroft.

Let's think about the consequences of such idiotic actions. Are they going to stop patients from seeking pain releivers? No, pain is a strong motivator and influencer of choice. Where is this going to lead the patients to? Grey market for prescription medicine or, in the worst case, drug trade on the Street. Who'll benefit, even if we assume that people will be too scared to run into the arms of their friendly neighbourhood crack dealer? Suppliers in the grey market, who don't ask too many questions. I'd bet on these to be mostly hard to regulate Internet pharmacies. Will the patients know exactly what drugs to order from them? Nope, that's why they go to their doctor, silly! Is that going to stop them from ordering whatever drugs they think might work on their pain? Of course, not. What incentives do their doctors have to monitor their patients' health? Let's see : lack of knowledge of what drugs their patients are on, increased malpractice insurance premiums, strong fear of prosecution by Ashcroft's goons and exposure to liability risk. Sounds like no incentives to me. My prediction? Patients will pay more for drugs and self-administer high-risk treatments to escape pain. Will they be better off? Doh!

-- Mahashunyam // 2:20 AM // 2 comments

Thursday, August 19, 2004

If invested right, technology creates more social capital which creates more technology which creates .... you know how that goes. Here's a fascinating example of how such effects manifest themselves : a rural district in India is the first to become e-literate, thanks to a government initiative.

-- Mahashunyam // 10:43 PM // 0 comments


I'll add an opinion on google. At $85 dollars a pop, google could be a risky investment. I'd still take the risk. Google has three main strengths as I see it.

The first is, of course, is technology and brand interaction. Their IP is well protected, their search engine is efficient and dominant. However, is it improving? Well, Google certainly spends a lot of cash on R&D. With new and innovative search companies trying to take a piece of the pie (such as vivisimo and blinkx) as well as competition from the old standards (MSFT, Yahoo, and Overture), google's search engine might no longer be the king of the hill. However, Google has been dominant for so long that their brand now has a life of its own ("to google"). This competitive advantage is important, and suggests that google will be a good investment for at least the next 3 or 4 years (or until we start saying "i'm going to microsoft this" or "yahoo it").

The second strength is their valuation, based on the stock price and number of shares offered. Google will have A LOT of cash. From a company that appears to spend their money wisely, this can only be a good thing. Unless of course they spend a couple billion developing the next big bust. The question also arises: is the valuation of google inflated, even hyper inflated? Based on its core strengths and market dominance, I don't think so. But, there's a reason this is the 'bubble' generation, and memories of tech companies, based on some graduates student's pipe dream, with zero income, ridiculous P/E ratios, and stock values in the hundreds of dollars is still a fresh reminder of the silliness that can occur.

Finally, Google seems to have developed (be developing) one of the biggest computer networks in the world. Their massive network of mostly middle of the road pentiums (with a good number of xeons thrown in to keep things running smooth) is a strong computing and storage resource.
In fact, if I were to make a wager, I'd bet (not a lot of money) that the first conscious machine will rise from this tangled network of processors, hard drives, and cables. One day google might just ask you how you're feeling today. I don't really believe that, but I do believe that google has some serious real estate in the digital landscape, which allows for the flexibility and clout to adapt to and address market being one good example of leveraging this computing muscle.

-- dhd // 3:45 PM // 10 comments


I will have more comments on the Google IPO, but suffice it to say for now that I predict a big first-day pop. This will mystify the academics and shut the Street up. Yes, I know, you probably predicted this too!!

-- umair // 10:26 AM // 0 comments


Nanostring aims to disrupt genechips by digitizing the process of gene identification. The results will be order of magnitude efficiences and a massive cost advantage - essentially, an entirely new platform for genome research.

This fits nicely with the evolution of nanobiotech - which essentially promises to extend genetic engineering beyond the current crude manipulations we're capable of.

-- umair // 2:16 AM // 0 comments



Hi folks,

Me and a couple of partners-in-crime decided to turn my sponsored discussions as blog ads 2.0 idea into a bigger thing. You can check out the preliminary version at Blogversations.

Panic, which is our prediction market (with simplified rules to make trading easier and more fun) is also open. If you tried registering before and couldn't, it's because we had a last minute bug with one of our market structures. All is well now, so trade away! I will post more about it tomorrow.

-- umair // 2:04 AM // 1 comments


Marketing 2.0 = Marketing 1.0 (But Stupider)

bugmenot gone? Looks that way. A very nice example of your friendly local marketing droids shooting themselves in the foot with the gold PP7. Why? Because I bet that killing one bugmenot will spawn about 3 (hardier) imitators.

Trying to kill something unkillable, as dhd points out nicely, has serious unintended consequences. (Via Mefi).

-- umair // 1:50 AM // 0 comments


Genome Economy (Geek of the Day Edition)

I understand neutral networks are a hot topic these days - here's a piece about a new technique breaking some ground. But mostly I linked because it's name is a geek factor home run.

"...To begin to understand the patterns of DNA changes that result from neutral mutation, Hwang and Green developed a new version of a powerful statistical technique that they call "Bayesian Markov Chain Monte Carlo sequence analysis." Basically, the technique enables them to feed in sequence information from genomes of different organisms and discern patterns that can distinguish models of mutational mechanisms.

-- umair // 1:47 AM // 1 comments


Genome Economy

The Adonis Effect:

"...Mayo Clinic researchers have discovered a genetic basis for this physical decline -- and have suggested that �silencing,� or turning off a specific gene complex, may halt weight gain and control bone loss. The team found laboratory mice without this gene function have 70 percent less body fat and exhibit the dense bones and lean bodies of young mice."

-- umair // 1:42 AM // 3 comments


Social Innovation

Bookmobiles in India:

"...The Million Book Project, a joint venture between India, China, the Carnegie Mellon University and Kahle's Internet Archive is an offshoot of this new technology. The project is further linked to Kahle's e-books -- 17 million of them. The christening of the project took its cue from Kahle's unassuming legend painted on his vans, "1,000,000 Books Inside (soon)". The project is set to digitise one million public domain books and make them available in scanned format for anybody for free by next year."

How cool is this? Incredibly cool. Social innovation is going to be an incredibly potent force. We can think of this as recapitalizing a stock of social capital.

The only problem is in countries with little social capital - ie Saudi etc. They can't achieve this kind of social innovation - because there is no capital stock to draw down. This highlights one of the coming problems with social innovation: increasing returns.

The trick, I think, is to seed social capital in the first place. But doing that is a very, very, very tough job - measure it by roughly counting how many states have failed in the last 50 years versus how many have succeeded. The rough ratio is about 10:1.

-- umair // 1:33 AM // 0 comments


Price competition and increasing entry in Pakistan's mobile industry.

-- umair // 1:27 AM // 0 comments


Ask and Ye Shall Receive

Remember a couple of days ago when I asked 'where are the punks' who usually sort out the geeks and the jocks? Weeell, turns out they're just about to arrive.

-- umair // 1:24 AM // 0 comments


Macfanatics take Real's thinly disguised propaganda campaign to school. Look, Real has always been less than great at marketing. But that's unimportant. There is a very important psychological (rather than economic) lesson about strategy in this episode.

It's this: there are different motivations for conflict. Some are harder to break than others; that is, we can say that different motivations have different risk profiles. The simplest (and often easiest) motivation to compete against is gain (ie, simple economic gain). The second simplest is culture. But by far the most complex (and difficult) motivation to compete against is ideology.

The masters of strategy, from Musashi onwards, have emphasized this point repeatedly. We've lost it recently in our quantitative view of strategy, in which motivation is difficult (but not impossible) to represent.

The point is that Jobs is shifting Real from an economic competitor to an ideological competitor. He's changing their risk profile; they are getting hungrier and hungrier to accept deeper losses just to inflict relative damage on Apple (and so realize a relative gain). This is not smart, because it doesn't just raise the stakes for Apple - it raises the stakes even more for Real.

-- umair // 1:10 AM // 0 comments


For all my fellow Philip K Dick fans. Especially in light of what's happening in the world these days. Enjoy!

-- umair // 12:55 AM // 0 comments

Wednesday, August 18, 2004

Adbusters' latest project is kind of a bizarre and misguided take on economics. They try and link neoclassical econ's overemphasis on quantification and model (which has been rightly criticized by many eminent economists) with...everything they hate in the world.

Sorry, but the two just don't link up. 'True-cost' pricing is the very essence of economics. Markets do work in the real world; that's why we use them.

I understand and sympathize with Adbusters' frustration with the corporates - but attacking econ is stupid. Econ is not responsible for killing species and deforestation. In fact, econ gives us the only tools we can really use to build systems to stop such lunacy.

I hate to rant, but I think this is a case of Adbusters being too naively first world for their own good. They should spend some time in the third world - where markets aren't - to experience the counterfactual: life without economics. Clearly, life with econ is a hell of a lot better.

-- umair // 11:15 PM // 0 comments


Rorschach Blog

The future of blogs - if you ask these guys, it's PR and marketing. Maybe that's because they're in PR and marketing.

-- umair // 11:07 PM // 0 comments


The death of spectrum licensing (pdf). Ever wonder why cell phone use costs so much? Why you have to pay out your nose to use what is essentially a free resource. Is it R&D costs, so that wireless companies can bring you the nth generation of services allowing you to check your email, browse the web, pay your bills, talk to your mom, and drive your car all at the same time? Maybe a little bit. It also has a little to do with paying back the cost of all the wireless equipment required to give you ubiqutous coverage. But a portion of it comes from these companies having to cover the costs they incurred when they purchased licenses for a portion of the artificially subdivided EM spectrum. I see this article as one classic example of the death of a licensing model in response to the pressures of the modern digital economy. With devices that can share the spectrum autonomously, the need for an archaic licensing system is long gone.

-- dhd // 8:21 PM // 2 comments


Raining havoc from above. This strange incident illustrates that even apocalyptic events such as the demise of human civilization due to a giant meteor impact can be subtly hinted at through a microevent. Chances are the supposed meteorite fragment is a common stone, and the supposed gash on her was caused by a terrestrial object. Nonetheless, I'd go play the local lottery if I was this woman.

-- dhd // 7:04 PM // 0 comments


Antibiotic resistance is quietly lurking as a potential disaster of black death proportions. High rates of bacterial mutation, general disinterest and improper drug use by the public, in combination with prohibitively high development and testing costs for pharma companies is leading us down a dangerous path.

So what's this mean? Well aside from a complete overhaul of the FDA (or relevant regulatory agency) drug approval policy for antibiotics or a concerted international effort to provide incentive for novel antibiotic or alternative drug therapy development (both of which seem unlikely any time in the near future), we're all screwed.

Seriously though, this type of trend will likely lead to some developing markets for products such as this. Crazy yes, but likely an indication of things to come. More promising developments (involving legitimate science) are mentioned here. My bet is on the bacteriaphages (good time to read up on some old Russian science).

-- dhd // 5:17 PM // 2 comments


A nice article on possible developments and future directions for wireless internet access.

With all this talk about wireless access for the masses, the ever increasing scarcity of electromagentic spectrum is becoming a real issue. Hence the FCC's Notice of Proposed Rule Making and Order (pdf) in regards to dynamic spectrum management and the implementation of cognitive radio (in my opinion, and those of many others, the next 'next big thing' in communications.) I will comment extensively on cognitive radio technologies and their potential market in upcoming posts.

-- dhd // 5:00 PM // 0 comments


Hi everyone, I will be posting on bubblegeneration from time to time. Just as an introduction, I work in the intellectual property field with an interest in a broad range of technologies (from communications to biotech), their implementation, potential for disruption, and market dynamics.

-- dhd // 4:56 PM // 0 comments


Global warming opens up opportunities for innovation in energy consumption : Air cooled by the frigid waters deep in Lake Ontario started bringing relief to buildings in downtown Toronto. (via slashdot). Pretty cool.

-- Mahashunyam // 4:48 PM // 0 comments


Distributed Economies of Scale

Lulu massively distributes book publishing - letting you publish, sell, and bill online (with on-demand printing for real-world delivery). Yeah, I know it has competitors - but trust me, Lulu's model is the right one: no up-front fees, which takes authors' risk out of the game, massively expanding the market.

What an absolutely wonderful idea. It makes me happy to see dotcom 2.0 in full effect - in fact, better effect. I nice acq target for our other favorite online bookseller? Maybe.

-- umair // 2:28 AM // 0 comments


Gray Markets Defeat Property Rights - Endgame

Illinois State Gov sets up a website to import cheaper drugs from Canada. This is one of the first hints of how the dynamics of property rights in Net-mediated markets inevitable play out - the gray markets get legitimized into the larger market, consolidating parallel markets into one big one with different qualities of substitutes at different prices.

This is why property rights are a strategic error. The writing's on the wall; smart firms will think backward, not forward - and realize that large-scale legitimization of grey markets doesn't just disrupt business models; it kills them dead.

-- umair // 1:13 AM // 0 comments


BSkyB sues EDS over CRM problems. The first of many to come?

-- umair // 1:03 AM // 0 comments


BSkyB sues EDS over CRM problems. The first of many to come?

-- umair // 1:03 AM // 0 comments


Hypergrowth causes infrastructure problems and inequities which lead to political pressure in Bangalore.

-- umair // 12:56 AM // 0 comments


Surveillance Marketing

Realizing the exponentially increasing gains to coordination, especially in the face of convergence across media, ad-supported industries develop a new standard to assign unique identifiers to ads and other 'marketing assets'. It's called Ad-ID.

"...The top four U.S. broadcast networks -- CBS, ABC, NBC and Fox -- have signed on to comply with a new 12-character code for tracking all advertising, a system heralded as a new standard for monitoring the $263 billion U.S. ad industry, the two advertising trade groups behind the system said.

Called Ad-ID, the technical switch is being compared to the introduction of the universal product code, or UPC -- the tiny bar codes that 30 years ago changed the way supermarket chains tracked and delivered inventory across the country.

...In about five years, Ad-ID and RFID could be used together, he said.

"Then we could measure whether we delivered the commercial to you, and, as I am monitoring your pantry, whether you bought the product, too," he said."

Very, very interesting. This is sure to detonate an arms race in privacy; it's also sure to spark a huge industry in complements (ie those who make sure RFID works with it, etc).

-- umair // 12:35 AM // 0 comments



Real slashes prices to break Apple's coming monopsony. You can hardly blame them; Apple's refusal to open it's platform has left them with no other short-term strategic option than price competition. This is how markets evolve - it's smarter to co-opt your competitors before they become rivals.

-- umair // 12:31 AM // 0 comments


Ed Sim says: Commoditization is not killing innovation. Of course it's not - commoditization is innovation pressure. A very nice point.

-- umair // 12:23 AM // 0 comments


UCL researchers develop glass that blocks heat (ie infrared) above 29 degrees but not visible light. Nice one.

-- umair // 12:15 AM // 0 comments


Outsourcing update from the NYT. You probably know most of this stuff already.

-- umair // 12:12 AM // 0 comments

Tuesday, August 17, 2004

No, no, no...'The Six Types of Business Blogs'. A surefire way to suck the creativity and essence out of blogging - thus ensuring that it pays no dividends for corporates as idea-generator and innovation multiplier.

-- umair // 11:59 PM // 0 comments


Plazes - a location coordination machine. The rise of this class of machines hints at my second big thing for the Net this year: machines that extend the Net's reach in space and time from smart objects (those with chips) to dumb objects (sidewalks, barstools, busstops).

These are symbologies like Spotcode, Semacode, and their assorted readers. The real tectonic shift will begin to rumble when location coordination machines link up with Net extenders - thus massively slashing the transaction costs of accessing a web of 'dumb' objects whose intelligence has been unlocked. Think about the value prop for a second - I think it will be a biggie.

-- umair // 11:48 PM // 1 comments


Intelsat shifts hands to private equity. Why is this a good deal? Oh come on. Any privatizing industry is usually a good deal. Not to mention the fact that Intelsat's mandated per it's terms of privatization to issue a public offering before next summer if I recall correctly.

It's very interesting - I was just researching this about a month ago - the entire satellite industry is essentially being massively rationalized and restructured.

-- umair // 11:44 PM // 0 comments


Replication Economy

Crackdown in Brazil begins:

"...Mr. Law, the owner of three shopping centers in downtown S�o Paulo where consumers can buy counterfeit or smuggled goods as diverse as CD's and DVD's, Rolex watches and brand-name clothing, had become one of the most notorious symbols of Brazil's thriving black market in pirated goods"

-- umair // 11:42 PM // 0 comments


We can add strengthenthegood to the exploding list of political coordination machines.

-- umair // 11:40 PM // 0 comments


-- umair // 11:36 PM // 0 comments


Plea from a developer : Apple, Please Open up the iPod API!

Scroll down to the comments area and see the discussion under "What would you like to see on your iPod?". It's a glimpse into the fascinating collection of ideas and possibilities for unleashing the creative potential of thousands of developers. Any other tech company would give its arm, leg and the CEO's stock options for even a tenth of such tremendous potential for entrenching their platform. Investing in complementors to create positive network externalities does not get any better, cheaper and easier than this.

Steve, don't blow it, PLEASE. Listen to the market for once, willya? We want you to win. Don't snatch defeat from the jaws of victory this time around, for cryin' out loud!

-- Mahashunyam // 11:18 PM // 0 comments


Strategy decay : Starter XP is so crippled, I think we can safely declare it dead on arrival. Constrained to run only three applications at a time? Wow!! We have seen a new level of strategic idiocy with this one.

Here's my take on how this "strategy", if I can call it that, might've been formulated : go through a list of checkboxes to de-feature standard XP to create "differentiated value" and position it in the "lower quadrangle of price-value map". Launch Starter XP at the low end of the product choice spectrum, and target it at the entry level value-seeker. This is classic marketing thinking, kinda like pitting the Saturn against the Civic. Since Microsoft is a monopoly, this is more like creating competition against Chevrolet by launching the Saturn.

However, from an economics perspective, there would be two more competitors in that spectrum : pirated copy of Standard XP and Linux. In economics parlance, these are substitute goods. Economics is the science of making choices and their causal relationships with incentives. What incentive does a value seeker have for choosing Starter XP? By definition, the value-seeker's prime motive is to get the highest value for lowest money. Where does he get the most bang for his buck? Considering that Linux has associated switching costs due to the value-seekers' unfamiliarity with the platform, the first choice is likely to be pirated XP. Is there any incentive for him to switch over to Starter XP? Nope. Why would he trade higher value/dollar derived from pirated XP for the lower value/dollar of Starter XP? The only additional benefit is the value of owning a "legal" copy. How much is that benefit worth? The expected value of this benefit is equivalent to the potential cost of prosecution and fine, which is the probability (risk) of prosecution multiplied by the legal fine. Since the rate or prosecution and conviction in cases of piracy is extremely low in the target markets, the expected value of the benefit ("marginal benefit" in economics parlance) is correspondingly low. Is it worth the additional cost of imposed de-featurization as well as the mark-up over the price of a pirated XP? Doh!

-- Mahashunyam // 6:39 PM // 1 comments


RCMP launches probe into Nortel. Saga of broadbandits continues...

-- Mahashunyam // 5:20 PM // 0 comments


Sterling's SIGGRAPH speech on Spimes. Aaargh. Look, Spimes are just a subset of something innovators have been discussing for ages - smart objects. Spimes are transparent smart objects.

I don't think Sterling's vision of Spimes will come to pass. Here's why: the history of innovation tells us that dominant designs are circumscribed by economics. Now, the economics of Spimes are fairly straightforward: since they're hypernetworked, the market will be a massively winner-take-all market. Imagine MS to the 999th power - with access to the entire universe of data collected, tracked, and predicted by every single object you interact with.

It's not that the possibilities for evil outweigh the possibilities for good - thought clearly they do - it's that the firm's incentive to do evil outweights it's incentive to do good. The gains firms realize by abusing Spimes are far greater than the gains they realize by using Spimes to, I don't know, create nicer better technologies. Why would a hypermonopolist create a better technology when he controls all the Spimes?

So we have a paradox: control of the Spime market would be fought against viciously by citizens and antitrust authorities. But this kills the gains to Spiming by firms. So firms are better off keeping their objects closed.

The only way a viable Spimes market forms is if somebody without the incentive to abuse it controls it. Who's that? no one - the control of the market must be massively distributed. How will that work? Well, to begin with, it requires a fundamental shift in our notion of capital, labour, investment, and return - which hasn't even begun to materialize yet.

Sorry if this was long, boring, and painful. Sterling made me do it.

-- umair // 2:20 PM // 0 comments


Link of the Day

Wow. The Smith School of Business and GMU's ECHO have set up two awesome sites: dotcomarchive and businessplanarchive. Highly recommended for would-be dotcom 2.0 players and students of next-gen business in general. I cannot emphasize enough how incredibly cool this is.

-- umair // 2:13 PM // 0 comments


In case you didn't notice, I decided to try out Chatango - a flash-based messaging system - chat away. (via Joi).

-- umair // 1:36 PM // 0 comments


Comments roundup

Hi folks, I know we've missed answering at least 2 or 3 comments in the last week or so. I'll open this thread up for those with questions. Sorry about this - Blogger makes it incredibly difficult to find unread/unanswered comments...

-- umair // 11:26 AM // 0 comments


The View From Out There : How Textbooks from around the world portray US history. Pretty cool.

-- Mahashunyam // 7:57 AM // 0 comments


An interesting list of "Urban Games" - location-based games for the GPS freak in you. Interesting way to get both exercise and quench the gaming thirst, just like Dance, Dance Revolution :)

-- matt // 4:10 AM // 0 comments


Jeff has a great post about why Tivo + Netflix should merge. I've been thinking about it lately - they're very nice hedges for each other from a risk pov.

-- umair // 1:50 AM // 0 comments


Ian Welsh has a very nice post that will introduce to you to some of Jane Jacobs' ideas. I highly recommend it - and I think her books are essential reading.

-- umair // 1:35 AM // 0 comments


Jobs Vs Jobs

Daring Fireball has another post up in favour of Apple's music strategy. It's a nice example of why thinking strategically requires careful definition of firms, industries, dynamics, and markets.

"...So the gist of the current punditry�s iPod-as-Mac analogy boils down to this: Apple makes something cool, but then they keep it to themselves, and then they lose the market to a knock-off from Microsoft that gets licensed to other manufacturers.

...The iPod, iTunes, and iTMS work with any modern personal computer, Windows or Mac. Yes, the original iPod debuted as a Mac-only peripheral, and iTunes for Windows appeared even later � but Apple offered complete support for Windows relatively quickly.

...Establishing a de facto standard format for DRM audio, on the other hand, is the type of success that keeps on succeeding. Ten cents a song on 100 million songs is nice; sell a couple of billion songs, and you�re talking about a serious cash cow. Not to mention the potential to parlay success with DRM audio into success with DRM video."

The piece is a lil too confused for me to cover entirely, but if you are trying to analyse this topic, here's some fat to chew on. First, the notion of compatibility in the post is confused - let's be more precise and just call it complementarity.

Now, it's not complementarity between PC and media that's of any importance in this discussion; we take for given that for any player to have a shot at standard-setting, the nascent standard must be complementary with the core platform.

So it's complementarity between media and media player that counts here. This is why the Mac/PC parallel is deadly accurate - just like before, it's complementarity between hardware and software that's important.

That's because the gains derived from complementarity are the incentives for consumers to buy into the platform. In 1984, more software got more PC buyers; in 2004, more media players and iTunes clones would get more iPod/iTunes (platform) buyers. This is how markets grow - different quality substitutes at different prices emerge, attracted by firms seeking profits.

So Apple has a kind of meta-resource almost no other firm ever captures - a chance to control market growth. But it's opting out of doing so.

Second, the role of industry dynamics is pretty much ignored. Sure, Apple competes against Real, MS, etc - but the real game, as I've argued before, is monopsony power over suppliers (record labels). It's not between Apple and Real, or Apple and MS at all.

So yes, establishing a de facto standard for digital audio will be valuable. But that's to restate the obvious. The real questions are twofold: how do you do it fastest, and for the largest possible market? And how do you do it without fragmenting your own buyer power over record labels?

If the questions are rephrased this way, the answer pretty intuitively becomes: create a platform, charge for access to it, co-opt your competitors' market power, and subsidize your own technological advantage to exert innovation pressure. Apple's lucky Real begged them to do this; most firms have to fight for it.

If you really, really, want, you can read my long, mind-numbing Apple vs Real pieces from a couple of weeks ago. But I really think you should do something fun instead.

-- umair // 12:27 AM // 2 comments


Om has a killer post about blogging and incumbent inertia from traditional media. Highly recommended.

-- umair // 12:26 AM // 0 comments


Free Can Mean Big Money: The Open Source Economy. A well meaning article, but honestly not the best way to think about this economically - maybe a nice way to think about in terms of accounting, though.

-- umair // 12:12 AM // 0 comments

Monday, August 16, 2004

The First World is the New Third World

1) "...Republican Rep. Katherine Harris said Wednesday she regrets making the claim that a plot existed to blow up the power grid in Carmel, Ind., a notion city officials disputed."

2) The FBI's 'questioning' and subpoenaing RNC protestors before they protest.

3) "...State police officers have gone into the homes of elderly black voters in Orlando and interrogated them as part of an odd "investigation" that has frightened many voters, intimidated elderly volunteers and thrown a chill over efforts to get out the black vote in November."

Orwell said freedom is slavery. Fundamentalist Islamic clerics actually say the same thing - in a surreally flagrant display of intellectual bankruptcy. Is freedom slavery? It's funny: in the States, just discussing this idea evokes derision and, often, anger. Why?

I think it's because liberty was hard-fought and hard-won in the States - but has, crucially, never been lost. So it's difficult for people to understand what it means for freedom to become slavery. How does it happen? Where does it come from? Isn't the whole notion absurd? This is how freedom decays into, at the end of an exponentially faster curve, slavery.

-- umair // 11:56 PM // 0 comments


Dolphin communities dependent on superconnectors for cohesion.

-- umair // 11:37 PM // 0 comments


The Walkman killed music:

"...The social pleasure of sharing music was terminated when people clamped plugs in their ears and tuned into a selfish sound. Music in the Walkman era ceased to connect us one to another. It promoted autism and isolation, with consequences yet untold."

Actually, I think this article makes some very good points - and tells us why file-sharing is giving new life to the music industry (despite their best efforts.

-- umair // 11:36 PM // 0 comments


Laws of the Machine

Two nice illustrations of my 3 laws of machines today:

#2 - Machines exert their own sociality. The explosive growth in online dating services creates demand for personal ad writers. But economics is only a description. It misses the effects of greater efficiency in the dating market - radically altered social structures and norms.

"...In his rewrite, he nixed space-wasters. "When they ask for five things [one has] in the bedroom" -- a standard personals question -- "don't include bed," he said. He tried to flesh out what he saw as Ms. Quattlebaum's naughty-schoolgirl side. Her original ad said her favorite on-screen sex scene was "Charlotte Gray ... passionate kissing and Secretary ... big sigh."...

...In Mr. Tesauro's hands, that answer became: "A little roughhousing in Secretary made me want to take dictation, though Cate Blanchett's Charlotte Gray reminds me that passionate kissing is enough to make a girl tingle."

#3 - Machines exert their own morality: In the UK, plans are underfoot to track the children of criminals:

"...In an interview with The Independent, Hazel Blears, the Policing minister, says she is optimistic that "tracking" and "targeting" can help prevent children becoming criminals like their parents".

-- umair // 11:33 PM // 0 comments


Politics of the Day

Fred Kaplan suggests there's no way 'out' of Iraq (I guess he means for us, and not the Iraqis). History suggests something none of the talking heads have really considered and that most of us would consider absurd - that Iraq should become (officially) part of the US. Sound stupid? Yeah. But think about every single empire that humans have created - the dynamic is nearly universal. Will we see it happen? I don't know (!)

-- umair // 9:08 PM // 0 comments


I like ChangeThis a lot. It's a nice example of something I predict a lot more of: political coordination machines - machines which slash the coordination costs of organization. As discussed in previous Next Big Things posts.

-- umair // 5:25 PM // 2 comments


Do you think it's a coincidence that the financial industry - one of the few industries which hasn't had barriers to entry eroded by the Net - is also one of the few industries making $$$?

-- umair // 4:24 PM // 0 comments


A hilarious story of now Warner blows it's chances with MP3 bloggers. Dear record labels, all is not lost. Talk to me and I will tell you how to engage these guys without coming off like ultrabeancounters.

-- umair // 2:49 PM // 0 comments



Roach has a fairly disturbing take on the macro picture:

"...By way of comparison, the last time the US had a �foreign trade problem� was in the latter half of the 1980s; back then, the trade deficit (as measured on a national income accounts basis) peaked out at 3.2% of GDP in the second quarter of 1987.

Needless to say, that was not the most tranquil of times in financial markets. As America�s external imbalance widened in mid-1987, the dollar came under sharp downward pressure and US interest rates were pushed higher. Those were the classic manifestations of a current account adjustment that many (myself included) believe were at the heart of the stock market crash of October 1987. "

I've been discussing this with some macro buddies, and they've pushed this line on me recently. It's not good to hear this echoed at the top of their community. I think the macro picture is pretty bad - but not this bad - because credit is better and fundamentals (ie earnings, cashflow, etc) are strong - but I'm not old enough to remember what really happened in 87. Time for a bit of quick research...

Am I the only one that appreciates the dark irony in the fact that Google's IPO -everyone's great white hope - is timed at the worst possible moment of the last 2 years? Ha ha.

-- umair // 1:43 PM // 0 comments


Reading somewhere recently about Sci-Fi writers having a tough time predicting futures as we get closer and closer to the Singularity.

I think that's fundamentally inaccurate. I think sci-fs has become largely intellectually bankrupt because of the new generation of writers refuse to include social science - and when they do, it's always less than breathtaking. My favorite example is Foundation. Foundation was a novel based fundamentally on economics - because Asimov understood econ, he could create a world that seemed realistic, not contrived and arbitrary.

Other great examples Arthur C Clarke's Rama and his Fountains of Paradise (Hi Sir Arthur, I hope you are reading this!). In Rama, economics dictates the dynamics of the biots. Fountains of Paradise - now prophetic - understands that economics circumscribes exploration.

I read more sci-fi than I probably should. There are, to me, only two sci-fi writers currently writing who understand social science. The first is Bruce Sterling. He leaves me cold, because anyone with an understanding of the macro picture is not surprised or left with a sense of wonder by his predictions.

The other, otoh, is Stephen Baxter. I think his Evolution - written with a deep understanding of how energy economics shape advantage, selection, pressure, sociality, and structure - is one of the most momentous books I have read in a very, very long time. If you want to be provoked, I strongly recommend reading it.

-- umair // 1:10 PM // 0 comments


An Intergalactic Investment Scam (via terranova). Wow!!! Most fascinating. These guys should have worked for Enron.

-- Mahashunyam // 8:49 AM // 0 comments


Trying to Take Technology to the Masses. The bridge to cross the digital divide will be financed by the market and rewarded by profits. Brilliant. CK Prahalad is really on to something.

-- Mahashunyam // 6:39 AM // 0 comments


California buys into open-source. (via slashdot). Given that most governments are struggling with expenses and deficits, it's understandable that they'd be very attracted to an order-of-magnitude economic advantage offered by Open Source.

-- Mahashunyam // 5:28 AM // 0 comments


More fortune at the bottom of the pyramid : Indian auto and electronics industries lead the way in creating mass markets to chase profits from the lowest income strata.

-- Mahashunyam // 2:27 AM // 0 comments


Great Unravelling

Christian Exodus - a movement with a plan for targeted migration of population to achieve a fundamentalist utopia based on theocracy (aka law based on the 10 Commandments) in South Carolina. Highly recommended.

-- Mahashunyam // 2:18 AM // 0 comments

Sunday, August 15, 2004

Macroeconomy and innovations : Canadians are beginning to ask themselves why Canada is not able to translate its high potential for innovations into home-grown technology winners. Right question, wrong answers.

What is it about a society that makes it more suitable for innovation? Are there any macroeconomic policy options for the government to stimulate innovation and monetize it for its citizens? Let's make a very simple model of wealth creation in which R&D supply is "purchased" for a society by its government, productization is done by entrepreneurs and financial markets serve as intermedieries. Government funding or R&D in labs and universities as well the development of well-regulated finanical markets can be effected by sound policy-making. However, the key differentiator is entrepreneurship, which is as much a manifestation of culture and societal values as it is a product of personal attitudes and public policy. If policy-making addressed this part of the equation, then that would lead to improvement in macroeconomic wealth-creation.

Think about why the US has been the innovation engine of the West, even though most western economies spend similar amounts on government R&D and have access to well-developed financial markets. It is openness, meritocracy, forgiveness of failure, willingness to take risks, availability of risk capital looking for high returns, cultural diversity and a belief in free enterprise. Compare these to Europe and Canada to see the contrast. Avoidance of risk, lack of diversity and an ambivalent attitude towards wealth creation through entrepreneurship are some of the key reasons why Canadians and Europeans have been losing the innovation race to the US. While a lot of these factors are a product of history, many of them also have real implications on policy-making. For example, compare the US bankruptcy laws with France. Or look at capital gains tax difference between US and Northern Europe. Or see the laws on stock options and their taxation/accounting. Look at the acceptance and assimilation of non-natives in the job market, as well as in corporate hierarchies.

Sound policy-making can indeed overcome many hindrances to entrepreneurship by addressing these factors. Specifically in the US-Canadian context, the major differences are in attitude towards risk-taking and the assimilation of non-natives in the labour market. What policies are in place in Canada to encourage risk-taking and absorption of imported skills in the economy? Why is it that a much smaller percentage of Canadian entrepreneurs are foreign-born compared to the US, inspite of Canada having a higher foreign-born population?

In my opinion, one big breakdown is in Canadian labour market. Canadian policy makers should be asking themselves some very hard questions about why some of their most qualified immigrants face extremely high barriers to entering the work force, because that has a disroportionately large adversarial impact on entrepreneurship and wealth creation. Comparison to the US on that parameter of policy-making is startling. For more research, look at these:

1.Immigrant Skill Utilization in the Canadian Labour Market:
Implications of Human Capital Research (University of Toronto)

2.The Hidden Job Screen (Trinity Western University)

Compare this with the US:

1.Silicon Valley's New Immigrant Entrepreneurs (Public Policy Institute of California)

2.Local and Global Networks of Immigrant Professionals in Silicon Valley (Public Policy Institute of California)

Note to Canadian policy-makers : next time you hail a cab, take a good look at the driver to see the failure of Canadian labour market policy staring at you in your face. Fixing it would go a long way in helping Canadian entrepreneurship.

-- Mahashunyam // 6:30 PM // 0 comments


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