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November 2004 Archives
November 30, 2004
Sun CTO to go mano a mano with Bill Gates
A good relationship between Sun Microsystems and Microsoft is undoubtedly a good thing, but comparable to Nixon's re-opening of US diplomatic relations with China?
Hope stays alive as "Sun Microsystems Inc. and Microsoft Corp. are poised to flesh out the details of the historic truce they signed earlier this year, ending years of bitter sniping between the two technology giants," reports the San Francisco Chronicle.
Greg Papadopoulos, Sun's chief technology officer, is the man who will go mano a mano with Microsoft chief Bill Gates, "because his boss, Sun Chief Executive Officer Scott McNealy, has publicly ridiculed Gates for years, calling him a convicted monopolist, among other things."
In Silicon Valley, burning bridges means never having to say you're sorry.
Gates and Papadopoulos formed something of a mutual appreciation society back in the 1980s, reports the Chronicle, in full Silicon Valley myth-building mode, when "when Gates gave a lecture at the Massachusetts Institute of Technology. Papadopoulos was then an MIT engineering professor and he had been assigned to welcome Gates." Papadopoulos found Gates "really accessible, sort of down-to-earth."
Links:
Making peace with a rival
Sun Microsystems sends a top man to sit down with Microsoft by Benjamin Pimentel, San Francisco Chronicle, 30 November 2004
What's the story? Doug Millison also edits OnlineJournalist.org, "on a need-to-know basis"
November 30, 2004 |
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Bloggers should reveal relationships—a proposal for an online media color code
In my “blogging” I try to be as up front as possible. If I have a business relationship with someone I will reveal it. If I mention someone and that person is a friend, I will tell you about it.
I think it should be perfectly fine to color code online content to reveal types of relationships. For example, if you see a name of a person or company and it is green, it denotes a monetary or business relationship. A person’s name in yellow might denote that person is a buddy, a cronie, somebody I’m unlikely to say bad things about. A name in brown might indicate a bit of brown nosing. A name in red might mean a “special” friend (!)
The more information a reader has about the relationships that a reporter/writer/blogger has--the better. Let’s not hide behind impressions of impartiality. I am not impartial. There are certain people I like, there are certain companies I like—I will make that clear. It’s part of what we are developing as our “Up Front” disclosure policy.
Yet in newspapers and news magazines—those relationships between the writer, editor and industry people are hidden. There is great care to maintain an impression of impartiality.
There is a lot that can be done in the online medium that has not yet been tried. A color code for relationships might be an interesting approach to maintaining an honest media during a time of great fragmentation. Blogging is fragmenting the media landscape but it requires trust. Maybe a color code could help in establishing and maintaining a trusted relationship between bloggers and readers.
Overall, we need a new approach to media and PR and I believe we are on the cusp of big changes in these areas. I want to help lubricate the wheels of change. Stay tuned.
November 30, 2004 |
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Blogger Om and blogging buddies broaden broadband content market
My good buddy Om Malik, his Om-ness, the universal sound of all that is broadband, is set to go live December 1 with TheBroadBandDaily.com.
Om, already dominating the broadband news market with his GigaOm site, is band leader of the new site. About a dozen hand-picked experts in various broadband sectors will be contributing blogs, news, and columns. Interestingly, I hear there will be no advertising. Om believes it taints blogging. Also, some of the content will be available in PDF format for easy offline reading.
PDF formatted content is really taking off and I think it is a great companion to a mobile lifestyle. For example, we are planning to produce an end of the week “Friday Watch” PDF newsletter containing the best of Silicon Valley Watcher that week—plus some fun items. Something to print up and throw into the weekend get-away bag, a chance to catch up on the week in Silicon Valley while in a hot tub in Tahoe.
PS: I tried getting as many “B”s into the headline as I could, but maybe someone can suggest a better one!?
November 30, 2004 |
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November 29, 2004
Silicon Valley changes on the horizon
Will Silicon Valley remain a leading force for innovation?
Yes, says Stanford University President, John L. Hennessy, in a Business Week interview published today.
That doesn't mean the Valley won't change, however.
Q: Let's look out a few years. How will the Valley change?A: I think several things will occur. In the aftermath of the bubble a lot more attention will be paid to core technology advantage and the sustainability of an advantage. Will there be a market for this technology? A lot more attention will be paid to both those things.
I think we'll see much more emphasis on whether you think of outsourcing some sort of the R&D function or restructuring it in some way. I think you'll see more emphasis on that, so that what gets done increasingly in the Valley is what would be extremely difficult to do somewhere else, rather than something that could be done somewhere else possibly less expensively.
The Valley's greatest weaknesses are high costs and arrogance, Hennessy correctly observes.
Links:
What's the story? Doug Millison also edits OnlineJournalist.org, "on a need-to-know basis"
November 29, 2004 |
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Should bloggers refuse advertising to maintain independence?
Should bloggers avoid advertising as much as possible, because that is another potential route to influence their writing?
There are organizational structures within newspapers and magazines that create a separation of “church and state,” the separation between editorial and advertising.
Because bloggers are trying to do everything—write, edit, publish and canvas for advertising—they are in a very tricky position.
For example, early this year, I ran into a blogger who was covering a political event, a speech by a political candidate—yet that person was also hoping to get advertising from the candidate's organization hosting the event!
If companies want to influence key bloggers they can do it very easily. Bloggers should stay away from any attempt at establishing a relationship: offers of access to top executives, free entry into conferences, meals and drinks with company representatives, basically ANY personal contact. The best bloggers can thus “keep it real.”
Professional journalists have to deal with this stuff every day: how to avoid attempts at influence, how to maintain professional relationships, and still produce great stories. In the UK, for example, journalists take great pride in being wined and dined yet writing brutally honest news stories about their host. "Biting the hand that feeds IT" is the motto of The Register, the UK tech news site.
Also, bloggers don't have editors. Journalists come under pressure from the demands of their editors for angles or stories that the reporters know are BS. This means that reporters sometimes/often cannot write the story they would like to write.
(I have a solution for this coming up...watch this space!)
The Register
November 29, 2004 |
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Controlling access to top executives is widely used to influence media coverage
One of the practices used to influence media coverage is controlling access to a company’s top executives.
For example, a reporter for a large newspaper or magazine needs access to CEOs of important companies. However, before that access is granted, a relationship has to be developed to ensure that a reporter understands their business, their strategy, who their competition is, how they differentiate themselves, etc before they give access to the valuable time of their top executives. This is all perfectly reasonable.
But, this is also where there is opportunity for leverage, where there is potential to influence media coverage to a larger or lesser degree, because reporters need that access. Why? Because editors will scream at them if their competitor got an interview with the head honcho and they did not.
Companies can demand that questions must be submitted in advance, that final drafts of stories be approved by them, that some subjects cannot be mentioned etc. This varies from company to company and larger publications are able to refuse such demands and still get the interview.
I have to say at this point, that in my time at the Financial Times I was never subjected to such demands. But all journalists are aware of this point of leverage, and some have been denied access for good and bad reasons. The good reasons are that they might have been sloppy journalists with little understanding of the company or their sector. The bad reasons are obvious.
The value bloggers have in the media landscape is their vantage as independent commentators. If they are brought into the “system” they will be compromised.
November 29, 2004 |
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Meet Mozilla Man
Meet Mozilla Man, the kind of evangelizer that every software maker needs.
A story in today's San Jose Mercury News lays bare for all to see the power of committed customers to evangelize - for free! - products that can compete successfully against entrenched competitors supported by high-budget marketing programs.
Microsoft cannot compete successfully with Internet Explorer as long as the likes of Alexander Vincent is motivated to spread the Firefox gospel. Observes reporter K. Oanh Ha:
....Vincent is a mild-mannered secretary for a Vallejo real estate broker. By night, he's an online crusader protecting users of a new Internet browser from glitches and security bugs. If he were a superhero, you might call him Mozilla Man....Vincent is one of roughly 2,000 volunteer evangelists who see their mission as freeing millions of computer users from the tyranny of Internet Explorer. Mountain View-based Mozilla -- with a paid staff of 12 software developers -- depends on volunteers like Vincent to help write code, fix software bugs and market the browser.
The rest of Ha's story reads like a love letter to the communitarian fervor that drives the Firefox volunteers, and the open source software movement more generally.
Links:
Volunteers spread word of Firefox
by K. Oanh Ha, San Jose Mercury News, 29 November 2004
What's the story? Doug Millison also edits OnlineJournalist.org, "on a need-to-know basis"
November 29, 2004 |
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Intel struggling, says New York Times
The New York Times rakes chip giant Intel over the coals today.
Barely four paragraphs into the story, longtime Silicon Valley observer John Markoff gloomily observes, "For two decades, Intel has been the most sure-footed of Silicon Valley companies. But lately, it seems to have lost its way.
Markoff lets Ashok Kumar, a financial analyst at Raymond James & Associates, drive another nail:
"They have made many wrong decisions and now it's time for soul-searching and structural, not cosmetic, changes."
The rest of Markoff's article focuses on the various challenges incoming Intel CEO, Paul S. Otellini will face.
One bright spot: a transaction Silicon Valley Watcher spotlighted last month: "Clearwire, a digital wireless start-up being led by Craig McCaw, a cellular telephone pioneer. Clearwire hopes to capitalize on the unproven long-range version of the WiFi digital wireless standard called Wi-Max and Mr. Otellini clearly hopes the technology will be a disruptive one."
Links:
The Disco Ball of Failed Hopes and Other Tales From Inside Intel by John Markoff, New York Times, 29 November 2004
Tech Watch: Intel invests in Clearwire by Doug Millison, SiliconValleyWatcher.com, October 25, 2004
What's the story? Doug Millison also edits OnlineJournalist.org, "on a need-to-know basis"
November 29, 2004 |
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Bloggers could become easy prey to standard public relations techniques
As companies and their public relations organizations ponder how to react to the “blogging” phenomenon, I’d like to point out some tricks of the trade used in the business of influencing media.
Forewarned is forearmed some say, and maybe some of the following will help bloggers who are not professional journalists.
I believe that some bloggers are in danger of losing their independence and their unique voice within the media landscape—if they become pulled into a sphere of influence. This is the “sphere” that professional journalists operate in every day and cannot avoid.
This sphere of influence has many aspects. It involves conversations with company representatives, being included in pre-briefings on important company announcements or mergers, prompt return of phone calls during breaking stories, invitations to events, being fed exclusive stories, and easy access to top executives. In each of those examples, there is a point of leverage that can be subtle, or it can be blunt and to the point.
I might not make too many friends by raising such topics but part of my mission with this venture is to educate readers about how the media “sausage” is made. And if bloggers give up a key vantage point as commentators on the media, by allowing themselves to be pulled into the sphere of influence, we will be poorer for it.
It is impossible to work as a professional journalist and not be influenced in some way. If this wasn’t true, there would not be a massive public relations industry. Many PR companies compare the cost of influencing editorial coverage with the cost of advertising in that publication. A common metric is a number that represents the ratio of: (PR cost of generating a certain amount of column inches in publication)/ advertising cost in that publication. Obviously, there is a higher value on editorial content.
More on this to follow…
[This is one of our “foundation” topics and there will be many more articles on this and related subjects. The goal is to foster a better approach to communicating ideas and generating high quality trusted media.]
November 29, 2004 |
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November 23, 2004
FUD in IT security markets can have serious consequences
The practice of creating fear, uncertainty and doubt (FUD) in markets has always worked well for the largest IT companies. IBM was first associated with this term but others quickly learned how to use the technique.
FUD is simple and very effective. If you are challenged by a smaller rival, maybe a startup, you say you have a better product/service on the way soon. Potential customers will often wait to evaluate both products/services. This provides the larger player with time to catch up, while the startup burns out of money or can't match the marketing dollars.
In my most recent column for the Financial Times, I make the point that FUD in the IT security sector could potentially have far more serious consequences these days. It can prevent the timely application of security technologies within large numbers of organizations, leaving them vulnerable to huge numbers of exploits.
Several security technology startups recently banded together to fight FUD and what they claim is a deliberate creation of a false sense of security. They have challenged the largest vendors, such as Cisco Systems, Symantec, Check Point and Juniper Networks, to allow an independent lab to evaluate competing security products.
From the FT column: (it’s a little strange quoting myself but the column is behind a subscription firewall so I can only smuggle a few paras out....)
The companies issuing the challenge are Imperva, NetContinuum, and Teros. Shlomo Kramer, chief executive of Imperva, is a co-founder of Check Point, the leading firewall vendor. The CEOs of the three companies are primarily concerned about the issue of application security. While the perimeter of most corporations is protected by firewalls, there is less protection against software that exploits IT applications and steals data for criminal gain. They say application security systems must meet certain minimum requirements.“We believe these minimums are not being met by many vendors, despite marketing claims that strongly imply such protection. The result is a false sense of security that exposes consumers and corporations to a higher risk of identity theft and other similar data loss threats,” they say. ICSA Labs, an independent laboratory, will be testing application security products and helping establish minimum standards.
I also note in the column that clarity in the computer security market is very important. Keeping the message simple will help sales and adoption. However, Symantec, the world’s largest security software company, seems to believe that clarity is best served by the introduction of a new IT term: “information integrity.” This term is now used to describe its security products and services. According to Symantec, “Security + Availability = Information Integrity.”
I recently heard that some security startups are considering adopting the “Information Integrity” term because Symantec uses it. This ability for a dominant company to change the language used to describe products or services is a formidable competitive advantage. But the introduction of more jargon won't speed the overall adoption of the latest computer security technologies. And I doubt it will do much for Symantec's sales.
We already know that computer virus, worm and spyware creators move far faster than computer security companies. There is no need to handicap things further with confusing IT jargon.
Here is my FT column, a subscription to FT.com is required.
dk0815
November 23, 2004 |
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November 22, 2004
Dour VCs lack enthusiasm for anything-- quick takes from Under the Radar conference
IBD Network recently put together another one of its popular Under the Radar events, which features hand-picked startups performing in front of a panels of VCs. It was interesting, but not for the reasons you might expect.
The startups are allowed a six-minute pitch and the judging panels are separated into categories, such as security, the digital home, etc. At the end of the day, the VCs give their feedback and highlight which companies they liked. This is part of the pre-cocktail panel called VC Outlook, which featured Neeraj Bharadwaj from Apax Partners, Lara Druyan from Allegis Capital, Robert Simon from Alta Partners, and Chad Waite from OVP Venture Partners.
The panel moderator was Rafe Needleman, a senior editor at Cnet. The poor guy had to work hard to get anything out of the VCs. They were stumped by questions such as, “Which of the startup companies you saw today really impressed you?” And they were rendered speechless when Rafe asked, “What have you seen lately that excites you?”
The VCs were happy to talk about what they didn’t like. They didn’t like the startups that pitched their technology rather than their solution. And there were too many startups offering technologies that were more akin to “features” rather than point products —- echoing Larry Ellison’s great line about Oracle’s dotcom competitors: “Those aren’t companies, they are features.”
They didn’t like security technology companies because there are too many of them. And they hated startups with consumer business models because of the large amount of money it takes to build a consumer brand.
It seemed that the VCs on the panel knew the enterprise IT market reasonably well, but they lamented that startups in that sector now have to compete against very large enterprise companies. Not to mention the downside of continued declines in corporate IT budgets.
I’m not sure what benefits the startup companies gained from the event. The VCs I spoke with said they would not invest in any of them because they look for exclusivity in deals.
But I did meet a guy, John, at the evening reception, who blew me away with his description of his startup venture. It is simple, brilliant, and innovative. And it is self-funding-- no VCs required. I promised not to say anything about John’s venture just yet, but it illustrates the fact that good innovation is happening -- it just doesn’t get in front of VCs.
Could the deal flow be slow, offering slim pickings because the deals are being snapped up before they get to the VCs by angel investors? I believe so -- angel investing is larger than ever and will continue to grow in importance.
These days it’s the angel investor networks that are better connected to new technology trends and innovation —- not the VCs. That’s because the angels are the ones providing nearly all of the seed money for startups. Many VC firms have shifted to investing in less risky late-stage financing rounds, where the companies are 3-5 years old, long past their “innovative” phase and now well into their monetization phase.
cd1841
Links:
http://www.ibdnetwork.com/
November 22, 2004 |
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November 19, 2004
Silicon Valley is similar to Las Vegas but without the all you can eat buffets
If you haven’t noticed by now, I’m a huge fan of Silicon Valley and I will tell you why in future articles. And I’m confident I will convince you why Silicon Valley is important and will continue to be so for many more years.
I like talking about Silicon Valley and I am often told that Silicon Valley won’t recover its importance, and is likely doomed to a slow and irreversible decline in its fortunes. Most of the arguments boil down to this: Silicon Valley will be unable to compete with the innovation that now happens all over the world; China, India, Canada, Israel, France, Poland, Taiwan -- innovation is happening everywhere and Silicon Valley will become a one-line historical footnote.
Yes, innovation happens all over the world. But why should that be a problem for Silicon Valley?
Let’s take a look at Las Vegas. With the boom in Indian Casinos, the majority of Americans now live within a three-hour drive to a place where they can legally gamble. That’s a bad scenario for Las Vegas. I would not be an investor with that kind of trend in play. Yet the last time I was there, it was bigger and brasher and richer than ever. There were no tumbleweeds in the streets.
This is what brand building is all about -— Las Vegas scrambled up the stack and became the premier gambling brand. It captured the "thought leadership" on all things gambling.
The regional casinos did not become competitors, instead, they acted as evangelists. The Indian casinos introduced millions of people to gambling and educated them on how to gamble.
And that is what will happen to Silicon Valley. Innovation around the world won’t harm Silicon Valley —- it will serve to enhance its leadership reputation.
Plus, Silicon Valley is going to be a leader in a very specific form of innovation -- I'll tell you about it next week (or maybe sooner if you call me.)
See also by Tom Foremski: Silicon Valley is back baby...dotcom
dm0731
November 19, 2004 |
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Dueling spinmeisters: Cisco and Juniper in the middle kingdom
Juniper was not happy with Cisco’s spin on business that both companies won recently with China Telecom. Cisco came out with the news first, late last week, that it won a good sized chunk of the China Telecom contract.
My sources say that Juniper was upset about Cisco’s spin on the news and that’s why it came out with its own announcement on the contract win earlier this week. Even so, Juniper has been restrained on the importance of the contract win, in accordance with its agreement with China Telecom about what it can announce publicly. My sources tell me that Juniper has done very well, beating out Cisco where it matters, in the high-end, high performance part of the contract.
I’m told that Juniper won ALL of the strategic part of the contract. Juniper’s network equipment was selected for the core of a high-speed national backbone China Telecom is building, and in eight regional networks in China.
That is more than a feather in Juniper’s cap—it’s a jab in the eye and a poke in the ribs from Juniper to Cisco. Cisco has often mentioned Asian competitors such as Huawei Technologies as potential threats—but it should look closer to home. Juniper is on a roll.
Juniper Networks Awarded China Telecom Next-Generation Network Contract.
dm0732
November 19, 2004 |
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November 18, 2004
Canada wants a piece of the offshoring pie--think of it as "India north"
Canada is ramping up its efforts to get a piece of the outsourced/offshore software development market, which of course is booming in India. Did you know that several Canadian provinces offer very generous tax incentives to US and other companies that locate part of their technology development in their regions?
And with costs going up in India, software development costs can be substantially lower in Canada, says Richard Savage, a consultant who works with the province of Ontario. "You'd be surprised at how generous the tax incentives are," Mr Savage says. “Silicon Valley companies should think of Canada as ‘India north.’”
Silicon Valley VCs are adamant that they will not fund a startup if the business plan does not have an offshoring strategy. My question is whether Canada qualifies as "offshore” to VCs? Companies such as Electronic Data Systems prefer to call their Canadian based operations "near shore."
By the way, insisting on an offshoring component is a tough requirement for startups-- they have enough on their plates without having to learn how to manage offshore development teams.
Also, it’s the VCs that pocket the benefits of offshoring first. They will put less capital into a startup on the basis that offshoring will lower development costs.
As a startup CEO told me earlier this year, “We get less money but the milestones the VCs want still remain the same.”
dk1738
November 18, 2004 |
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The graying of Silicon Valley... just one more bubble!
Silicon Valley doesn't have its young whiz kids anymore, those icons of youthful energy and enthusiasm that were common during the dotcom boom years. Some of those kids moved back East. Some moved in with their parents, I'm told. Others stayed here and have “gone native,” becoming hooked on the startup culture.
Overall, it’s an older crowd these days. I'm seeing a lot of entrepreneurs, and a lot of startup teams that have significant numbers of people in their mid-40s to late-50s. If you were to combine the ages of the management in a startup team, you could probably easily hit 500 years.
Were you to also add in the board of directors' ages, you could probably reach 1,000 years. (By the way, I have no statistics on this; but I would love to see someone chart this and map it against local economic cycles.)
That's pretty good: a millennium of experience sits within the centers of many startups. And let’s not forget that we also have a lot of aging venture capitalists out there. There is a huge amount of experience within those ranks.
So, that should mean that the current crop of Silicon Valley startups would be a very successful bunch. Smarter managers plus smarter money must equal lower risk of failure. Is my math right?
After all, many of the people on these management startup teams have survived this downturn, and at least four prior ones. They have business experience that dates back to a time when the IBM PC did not exist.
Plus, they are a highly motivated bunch, far more motivated than the MBA script kiddies of dotcom boom days. These Silicon Valley gray hairs just need that one last decent sized success to cash out. Or as one grayhair told me recently “Just one more bubble, that’s all we ask.”
cd1530
November 18, 2004 |
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November 17, 2004
Silicon Valley . . . Nigeria
Abuja Technology Village is modeled after the Silicon Valley USA, says Nigerian Minister of the Federal Capital Territory (FCT) Malam Nasir el-Rufai, according to a Xinhuanet report.
Learn more about Nigeria...
Nigeria will spend $38 million on the 650-hectare development. Nigeria's Silicon Valley is expected to create some 40,000 jobs and serve as a center for technology outsourcing, the government says.
cd1545
Links:
Nigeria to set up silicon valley, Xinhuanet, 17 November 2004
OnlineJournalist.org, edited by Doug Millison "on a need-to-know basis"
November 17, 2004 |
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The time when Sabrina Horn almost table danced… PeopleSoft vows to innovate, and Sun says its software will be free
The Horn Group PR company held a dinner Tuesday evening featuring a panel on “Does Innovation Matter: The Silicon Valley Outlook” a topic dear to my heart.
The event was at Roe—a Burmese fusion restaurant next to Hawthorne Lane. I arrived late for cocktails and looked around and didn’t see any of the Silicon Valley Hack Pack, except for J. Bonasia, reporter at Investor’s Business Daily. The poor guy has been covering the software enterprise beat and if it weren’t for Oracle-PeopleSoft he’d have little to write about. I was asked how did I think the PeopleSoft/Oracle thing would turn out? I said I do not know, I have not even considered it, it just doesn’t feature on my radar screen.
That whole enterprise software sector seems like a bygone era, like some kind of Jurassic period. Yet that whole sector can continue living off the maintenance revenues for years—it isn’t going away. But there is nothing to write home about either.
Fortunately, I was seated next to some Silicon Valley grayhairs—my favorite kind of people, the ones that have been around the block many times, and either come back for more or can’t find an exit strategy! On my right was the dapper Paul Wiefels of the Chasm Group, the very successful Geoffrey Moore consulting group franchise. I’ve met Paul before and he is always good company. On my left was Barry Goss, chief product officer at PKWare, the enterprise data compression and security company, another great dinner companion with Silicon Valley stories that go back to 1980.
Sabrina Horn, the head of the Horn Group stood up to commemorate 13 years of the Horn Group, and to thank her first client, PeopleSoft, represented at the dinner by Rick Bergquist, CTO and PeopleSoft Fellow.
“I almost danced on the table,” Sabrina recalled, when she landed her first client. I cannot recount how many wonderful dinners have been ruined by a panel (in this case it was also the curry sauce on the filet mignon)—but, we dutifully sat through what seemed hours of chatter about innovation from representatives of companies such as PeopleSoft, and Sun who had seen their best years of innovation when President Reagan was in power.
Mr Bergquist announced that PeopleSoft was going to take on SAP with “innovation.” I can’t wait to see that battle of triceratops versus stegosauraus.
Also on the panel: Mark Gorenberg, partner at Hummer Winblad Venture Partners, Josh James CEO of Omniture, David Martin, CEO of Qlusters and Prem Uppaluru, CEO of Transera. MR Rangaswami co-founder of Sand Hill Group and organizer of Software 2005, moderated the panel, and he did an excellent job demonstrating knowledge of trends within the software sector that many of the panelists lacked.
There was a lot of open source bashing by the panel, same old arguments, total cost of ownership, blah, blah, blah. All I’d like to say on this subject is: open-source is way more than just Linux, and if the open-source steamroller doesn’t get you, “good enough” will. You have to keep climbing the stack.
Offshoring also was discussed and everyone agreed that it was good for innovation. By the time the panel was done, many of the diners had slipped away but I did have an interesting chat with Mark Feldman, senior vp of marketing at Virsa Systems, which offers “real-time continuous compliance” software for Sarbanes-Oxley.
Mark has got a killer marketing message aimed at CEOs “use our software and stay out of jail.” He says that business is booming. Earlier this year Virsa picked up $15m from Kleiner but hasn’t had to touch the money because sales have taken off like a rocket.
An interesting aspect of Virsa’s business is the large amount of internal fraud that its systems can uncover within customer companies. “It more than pays for itself in revealing internal fraud of hundreds of thousands of dollars, and in some cases, much more than that,” Mr Feldman says.
dk0900
November 17, 2004 |
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November 15, 2004
Andreesen's new company? Not all that new...
Business Week is touting Marc Andreessen's newest venture, Opsware.
"The Web browser pioneer's latest company, Opsware, may be sitting on another gold mine with its utility computing software," writes the venerable weekly.
The new company offers networking software that is the final remnant of Andreesen's ballyhooed post-Netscape venture, Loudcloud, which withered in the dot-com bust, and will compete against BladeLogic, a Waltham, Massachusetts start-up, Sun Microsystems, IBM, EMC, and Veritas Software.
Prospects for the company look reasonable, although the company is still losing money:
While Opsware is hardly the tech giant many envisioned Loudcloud would become, it's healthy. It has been cash-flow-positive for five quarters, revenues are expected to double to $35 million this year, it has more than 250 customers, and some analysts expect it to turn profitable within the next year. It has had two profitable quarters since it was founded. In its most recently reported quarter, which ended July 31, Opsware lost $813,000 on $8.6 million in sales.
Links:
Andreessen: The Right Spot Again?, Business Week
OnlineJournalist.org, edited by Doug Millison "on a need-to-know basis"
November 15, 2004 |
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Silicon Valley is Back, Baby.......Dotcom
I've had lots of chats about Silicon Valley lately and I’m of the Bachman Turner opinion that you ain’t seen nothing yet.
When I arrived here November 8, 1984, Silicon Valley was going through the down cycle following the PC boom. A hundred PC companies wanted just 10 per cent of the market, wanting to strike it rich, as rich as the Apple IPO—the Google celebrity IPO of its day.
Hundreds of Apple staff became millionaires, including secretaries and the guy that ran the parking lot. The media coverage was massive. VCs rushed in like a herd and funded a huge number of PC companies and when the bubble popped, the down cycle was harsh. Stories about Silicon Valley’s death were constant and grinding for several years. I’ve seen several business cycles and the same thing happens in each down cycle, endless speculation about Silicon Valley’s future. What future does Silicon Valley have?
I think I can answer that question very easily—and I’ll accept any size bet on this call: when Silicon Valley comes back, it will be bigger than before. (Actually, it’s been back for a while--hence this venture.)
I was chatting with Ron Piovesan, from Cisco on this topic recently, and he says has also seen signs of improvement. He laughed when I said I own the dotcom name: SiliconValleyIsBack.com.
I said I’m serious, I do own it. I also have SiliconValleyisBackBaby.com! I'm going to set them up as headlines--heck, they were only $8 apiece. I bought SiliconValleyGarage.com for $8 too. Maybe I'll set it up as a tribute to HP?
Things in Silicon Valley might look bleak if you look at the big cap tech companies but they don’t when you look at startup activity.
Silicon Valley is very much like a fairground slurpy -- big chunks of ice with most of the juice at the bottom.
And there is a lot of juice accumulating, the laptops are discretely reappearing in bars and restraunts, and there are many signs of bubbly behavior.
Getting back to Silicon Valley…
It’s going to have a larger impact than before. I’ve been through about 5 business cycles and each time Silicon Valley has come back stronger.
The most recent comeback, the dotcom boom, was the first time Silicon Valley was able to have an immediate worldwide economic impact. It was the first time it became hooked up to world stock markets through the tech IPO flood. This provided a mechanism for trading in Silicon Valley’s ideas. Remember, many dotcom companies were stories--stories about business concepts--revenue models were not necessary.
I think this time around, Silicon Valley's ideas will have a larger impact and things generally will be done differently. The way Silicon Valley innovates will be different, media will be different, PR will be different.
And this time around, dotcoms will eat the lunch of the established companies. Then they will eat the companies (or at least suck out the soft fatty stuff such as the brand image and leave behind the crunchy legacy infrastructure stuff.)
There will be many companies that won’t be able to reduce their cost base fast enough to meet the efficiencies of new Silicon Valley "new rules" ventures.
I’ve got some views on where I see things heading, and I will write about those trends and I’ll probably check them out myself. That’s because the next phase of the internet is going to be all about . . .
To be continued . . .in SiliconValleyWatcher. Reporting on the business of Silicon Valley.
(Drop me a note sometime…!)
November 15, 2004 |
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The usual suspects at Text 100 event
"It was a dark and stormy night; the rain fell in torrents--except at occasional intervals, when it was checked by a violent gust of wind which swept up the streets..."
But we made it to the Text 100 office opening last week.
It gave me another chance to play in my three-dot journalism persona, chronicling the geek society. The party felt a lot like the Bite Communications party the previous week--a lot of the same people standing around and yacking.
Text 100 and Bite are owned by the same parent company, Next Fifteen, which would explain that deja vu feeling as I walked in with Louise Kehoe, my former colleague at the FT.
. . .
I quickly ran smack dab into Jeff Lettes, corporate comms chief at Applied Materials and Tim Dyson, head honcho of Next Fifteen, and it was as if we were still having the same conversation as the week before. But this time, I found out an interesting connection between the two of them—they drop off their kids at the same school. (This is the kind of stuff you can only read about here, on Silicon Valley Watcher: we reveal the hidden insider networks that power Silicon Valley.)
. . .
The event had much the same Silicon Valley Hack Pack as always, give or take a Quentin or a Cory. Don, by the way, is the Silicon Valley Hack Pack’s chairman of the board. He is tireless in his pursuit of great stories or a decent cilantro prawn appetizer. I’m also happy to grab a bag of stories at such events, and some “one inch food” from the appetizer trays. And let me tell you--it takes many long years of professional journalism to master the art of eating a healthy and well balanced meal and choosing the right appetizer combinations. That’s another reason bloggers wouldn’t make it in the top tier of hacking and flacking--they would die of malnurishment or obesity. That’s why this type of thing is best handled by professionals.
. . .
Text 100’s Emma Wishchhusen soon grabbed me by the elbow and led me to a darker and quieter corner of the party. She seemed eager to talk with me and I was a little excited that maybe she was going to give me a scoop on some news about one of her clients. Instead, she demanded to know: “What is your business model?” It was a question several others asked me later that evening. My answer was always the same: my business model is to make money from publishing online content.
I know what one-half of the business formula looks like—produce as much original and compelling content as you can. The other half of the formula is not yet clear, I’ll admit. But I know that unless we can create a great editorial product it doesn’t matter what revenue model we choose.
We’re currently in beta/soft launch mode but as we step things up early next year you’ll see some innovative revenue models. (More on that topic at another time…)
. . .
The party grew hushed and respectful as Aedhmar Hynes, Text 100’s chief executive, spoke for a few minutes about how far the company had come from humble beginnings. She remembered that when Text 100 first opened its San Francisco office, it took six weeks for office furniture to arrive and they had to make do with desks that were just planks of wood on a couple of breeze blocks. (So this is where that signature dotcom fad started…!)
Steve Fox, InfoWorld’s chief editor, was introduced to speak about top trends or something along those lines. Steve is an excellent storyteller and I’m sure it was interesting stuff, but the party yacking level gradually started to pick up again as people realized Steve wasn’t buying the drinks. So I didn't get to hear Steve’s top trends (did anybody blog it?)
. . .
Aedhmar had brought along her newborn baby and vowed that four kids is enough. “I don’t know how it happened,” she remarked. I didn’t feel it was my place to explain these things—but I do have two kids myself and I am somewhat familiar with waking up in the morning and thinking “what the heck happened last night…?” (Not that I would suggest in any way that Aedhmar suffers from my particular malady, of course....)
While I enjoy teasing Aedhmar I also enjoy having someone to talk with about kids. Just before Aedhmar went on maternity leave, I remember a conversation we had about how kids are master manipulators, working one parent against the other. And we were marveling at their powers of persuasion and persistence—qualities that should be very helpful to them in their adult world.
. . .
Other bits and pieces: Joe Fay, Computerwire US editor seems positive about his move back to London in the new year. Young Kevin Murphy, cub reporter at Computerwire (er, sorry, Kev, deputy US editor isn't it?) has officially applied for Joe's job.
I got a lot of great feedback on Silicon Valley Watcher, it's being passed around which is great and we haven't even started doing all the things we want to do.
Burghardt Tenderich, GM of Bite Communications North America told me he is writing a blog and it is getting a very good response in Germany. "I've been writing a lot about the election," he says. "I'm trying to explain to people why Bush won." I'd like an explanation too but I do not read German. If you do, here is Burghardt's blog:
http://burghardt-tenderich.blogspot.com/
Three-dot Journalism and Herb Caen--the original blogger.
http://www.siliconvalleywatcher.com/mt/archives/2004/10/media_watch_san_1.php
November 15, 2004 |
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November 12, 2004
Tit for tat
You'd think these were squabbling grammar school kids, not two of the most powerful companies in the software industry. First, Google runs an unflattering photo of Bill Gates on its news.google.com page, next to stories about Microsoft's launch of a competing search engine, on the day of the announcement. Now, Microsoft has apparently struck back.
A search for "more evil than Satan" on Microsoft's new search engine returns Google as the top result.
"A subtle jab by the Redmond search engine crew at Google?" asks Silicon Beat.
These are the folks we are supposed to trust to index and search our PC desktops?
Links:
The most evil search engine? by Sarah Lacy Silicon Beat, 12 November 2004
MSN Search results for "more evil than satan"
What does Google think of the Microsoft search engine? by Doug Millison, Silicon Valley Watcher, 11 November 2004, includes screen shot of news.google.com with unflattering picture of Bill Gates and close-up showing what Gates is really doing with his finger
Affiliate Link:
OnlineJournalist.org, edited by Doug Millison "on a need-to-know basis"
November 12, 2004 |
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November 11, 2004
Halo 2 the wait is over but what about the “Arabic” sounding aliens?
Halo 2, the Xbox videogame, has been a long time coming and has missed seemingly countless launch dates (it is a Microsoft product) but it finally arrived. And my son Matt tracked down a rare copy in San Francisco on Wednesday after we visited half-a-dozen different stores. It turned out that the Good Guys had a secret stash. “No one seems to know that we stock games,” said a salesperson at the Van Ness store.
I finally got Matt off the game at 3am this morning then he was back at it by 10am. But he made an interesting comment, “What’s with all the Arabic sounding names of the aliens?”
I looked at the booklet that came with Halo 2 and there are indeed, some names that do not require too much stretching of the imagination to notice an “Arabic” twang to the types of aliens encountered in the game. There are the Sangheili, described in the booklet as having a “thirst for human blood and vengeance for the atrocity at Halo, and their loyalty is unquestioned.” There are also Jiralhanae of “simian origin” and the Kig-yar.
The leaders of the alien forces are the Prophets described as the “guiding light and directors” that will lead the alien forces “to truth and perfection.”
By the way, “Hala” is Arabic for “halo around the moon.” Fans of the game will be familiar with the circular world around a moon, on which the gory battles with the aliens take place.
I’m sure that the Arabic sounding alien names are not intentional and most probably an artifact of the society we live in.
November 11, 2004 |
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Silicon Valley's hometown heroes
The Tech Museum Awards shine a well-deserved spotlight today on Silicon Valley innovators who have applied technology to humanitarian causes.
K. Oanh Ha's story in today's San Jose Mercury News trumpets the achievements of the "winners in the fourth annual Tech Museum Awards" including:
Local researchers Paul Burgess and Ken Owens Jr. applied their software and mathematical talents to make a robot that will save tens of thousands of lives and limbs from land mines, the treacherous remnants of war.For the past two years, the pair have spent countless hours in their windowless office at Humboldt State University maneuvering a radio-controlled toy car with a joystick. They came up with a new breed of mine-clearing robots that will operate with unprecedented accuracy down to a centimeter. Using a global positioning system, it removes mines the size of a tuna can.
....Burgess, whose hometown is Fremont, left a six-figure software job in San Francisco, while mathematician Owens left the security of a NASA job to develop their project.
"I wanted to do something that was an end to itself rather than the end being a paycheck," said Burgess, 28. "When you do work that you feel is benefiting other people and this is consistent with your own set of values, it's rewarding and addictive."
Links:
by , San Jose Mercury News, 11 November 2004
Affiliate Link:
OnlineJournalist.org, edited by Doug Millison "on a need-to-know basis"
November 11, 2004 |
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Intel names a new CEO
Paul Otellini will become Intel's chief executive when Craig Barret ascends to chairman next May, the Associated Press reports.
The 54-year-old Otellini is a "30-year Intel Corp. veteran who oversaw the launch of the Pentium processor in the 1990s."
Andy "Grove, who has served as chairman since 1998, will leave the board to become a senior adviser to the board and management," the AP reports. "Barrett, 65, will then become chairman, following the same path as Grove and, before him, company co-founder Gordon Moore."
Links:
Otellini to Succeed Barrett as Intel's Chief by the Associated Press, in New York Times, 11 November 2004
Affiliate Link:
OnlineJournalist.org, edited by Doug Millison "on a need-to-know basis"
November 11, 2004 |
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November 9, 2004
A new look for Silicon Valley Watcher
I’ve been nursing a bad cold but I wanted to take the opportunity of introducing a new look for Silicon Valley Watcher and to praise the work of my colleague Dida Kutz. The creation of a three column layout using Movable Type, or for that matter any other server-side web publishing application, is not an easy task.
Movable Type for example, was designed to publish blogs. It is very good at publishing one long page, split up into “entries.” It is also a good and inexpensive content management system, automating many tasks such as archiving that save on admin costs.
However, Movable Type is not a flexible publishing tool—at least not yet. As an online publisher I would like to be able to publish a variety of content and to present that content in different ways.
I want to go beyond the standard expectation of what a “blog” is and write news stories, features, columns--in addition to daily blog entries.
And I want to to be able to easily promote our best content on the home page, without those stories being pushed further and further down towards the bottom of the page. Yes, there are a variety of ways to work around these issues, but there is way more that needs to be done to create a very flexible server-side web publishing platform.
The three-column format will allow us more flexibility to promote our columns, features and other original content. And it will also allow us to comment on daily events in a traditional blog format. We’ll be playing around with the format over the next few weeks and we are always happy to have hear your best ideas in terms of presentation or anything else!
November 9, 2004 |
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Silicon Valley's VC point man in China
by Doug Millison for SiliconValleyWatcher.com
The man with the cure for China market fever is Lip-bu Tan, "one of the first U.S.-based VCs to begin investing in China," according to the San Jose Mercury News.
Tan, chairman of Walden International "was one of the early backers of Chinese semiconductor company SMIC, which recently became the fastest company ever to hit $1 billion in annual sales," writes Matt Marshall. More important, Tan "helped bring other VCs into that deal."
Marshall reports that Tan is leading a deal to invest $11 million "in a Chinese semiconductor-equipment company, bringing in a group that includes a few first-time Silicon Valley investors in China: Interwest Partners, Lightspeed and Bay Partners."
Other VCs who have partnered with Tan in China deals, according to Marshall, include:
- Robert Chaplinsky of Mohr Davidow Ventures
- David Britts of ComVentures
- New Enterprise Associates investing, with Tan, $15 million in Telegent Systems, "another fabless-chip company that enables TV broadcasting on mobile devices"
Marshall says Tan has become the go-to man because he speaks Mandarin and Cantonese and has well-placed Chinese connections.
Having lived in China for a year and a half and possessing fluency in Mandarin, I can say that it is the standard dialect, nationwide, necessary for interacting with Beijing-based government officials. Cantonese is the devilishly difficult (even harder to learn than Mandarin because it has a more complex system of tones) dialect spoken by clannish entrepreneurs in southeast China, Hong Kong, and throughout the Overseas Chinese diaspora.
Since Tan keeps a home in Shanghai, according to Marshall, I wonder if he might have some fluency in Shanghai dialect, too, which is also very difficult. (Mandarin, Cantonese, and Shanghai dialects are very different, mutually unintelligible, with wildly varying pronunciation and idioms - but all educated Chinese read essentially the same written language, with some local differences in diction.) Shanghai, colonized by the French, Germans, British, Americans, and Japanese in the first half of the 20th century, is often called the Manhattan of China, because of its cosmopolitan culture, and because of the entreprenurial gusto expressed by the native Shanghainese. (To get a flavor of the difference between Northern and Southern China, think Red State/Blue State, to put it in terms of the recent Presidential election.)
Marshall hints at what must be true, if Tan truly has the kind of clout necessary to put together successful deals of this size and scope: Tan's contacts include highly-placed officials in the Chinese Communist Party-controlled government who are the gatekeepers for investment and profit repatriation, and who provide protection against project-killing bureaucratic or legal action.
Marshall reports that Tan "has a penthouse in Shanghai," but "he wants to keep his base here, saying his wife and kids like it too much to leave." Tan sits "on the board of the San Francisco Opera; is a fan, with his sons, of the Giants, Raiders and Warriors; and is involved in a church group here."
Links:
Silicon Valley's go-to man in China by Matt Marshall, San Jose Mercury News
Affiliate link:
OnlineJournalist.org, edited by Doug Millison "on a need-to-know basis"
November 9, 2004 |
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New nanotechnology research center
by Doug Millison for SiliconValleyWatcher.com
Computer tech, bio-tech - now nanotech.
The University of California, Berkeley announced its $11.9 million Center of Integrated Nanomechanical Systems (COINS) is starting up this fall, promising "nanobatteries, nanopumps, nanomotors and a slew of other nanoscale devices – most with parts that move a mere fraction of the width of an atom."
The center is one of six new Nanoscale Science and Engineering Centers funded for five years by the National Science Foundation (NSF). Theoretical and experimental physicists, chemists, biologists and engineers will explore the basic science of nanostructures and then use this knowledge to both create nanoscale building blocks and assemble them into working devices.
Says UCB, "The goal is to merge nanotubes and a host of other Tinkertoy-like nanopieces with organic molecules – DNA, proteins or nanomolecular motors – to create sensors or nanomachines small enough to fit on the back of a virus. Each nanoscale building block ranges from a few to hundreds of nanometers across(a nanometer is a billionth of a meter, about one thousandth the width of a human hair)."
The group consists of 28 researchers from UC Berkeley, UC Merced, Stanford University and the California Institute of Technology, and includes not only engineers, physicists, chemists and biologists, but an economist. While some of the researchers are synthesizing and characterizing various building blocks, others will integrate them and map out system properties, and still others will develop the tools to manipulate and construct new building blocks and systems. Several researchers will pursue the theoretical basics and limits of new devices. And Brad DeLong, a UC Berkeley professor of economics, will explore the social, ethical, legal and societal issues surrounding nanotechnology in light of historical technology revolutions. He also will encourage conversations between nanoscientists and scholars in the social sciences and humanities.
On the People Watch tip, UCB says some of the researchers and their projects include:
Mechanical engineering professor Arun Majumdar has developed arrays of nanoscale cantilevers that flex like diving boards when molecules bind to them. Majumdar, along with Michael Roukes, professor of physics, applied physics and bioengineering at Caltech, and other collaborators will try to turn these into biosensors using lasers to detect the binding of minute quantities of chemicals.
Electrical engineering professor Ron Fearing is working with Peidong Yang, associate professor of chemistry, and Thomas Kenny, professor of mechanical engineering at Stanford, to create artificial nanohairs that will adhere to surfaces as do the toe hairs of geckos.
Carlos Bustamante, professor of physics, and other researchers are trying to convert the chemical energy in twisted DNA into mechanical energy that can crank a nanotube motor. Bustamante is working with physics professors Michael Crommie and Steve Louie; Kyeongjae Cho, professor of mechanical engineering at Stanford; and theoretical biologist George Oster, UC Berkeley professor of molecular and cell biology.
A team led by Majumdar and Ramamoorthy Ramesh, professor of materials science and engineering and of physics, is studying the movement of fluids on the nanoscale in order to develop a battery. This research also could lead to a novel type of transistor based on nanofluidics.
Researchers with the Berkeley Sensor and Actuator Sensor, which 18 years ago pioneered microscale devices or MEMS (microelectromechanical systems), are transitioning to the nanoscale with attempts to create devices from nanowires, such as a vibrating resonator. They include Roger Howe and Jeffrey Bokor, professors of electrical engineering and computer science, and Roya Maboudian, associate professor of chemical engineering.
Zettl, Bustamante and Maboudian will work with chemistry professors Jean Frechet and Paul Alivisatos, as well as with other collaborators, to camouflage nanomaterials so as to allow the binding of tailored molecules, proteins and other biological molecules. These “functionalized” nanomaterials could mimic large biological molecules in the body.
Links:
New center to research nanostructures, design and build nanodevices, UCB press release
Affiliate link:
OnlineJournalist.org, edited by Doug Millison "on a need-to-know basis"
November 9, 2004 |
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Silicon Valley supercomputers stay on top
by Doug Millison for SiliconValleyWatcher.com
Credit Silicon Valley with the world's top two fastest supercomputers and with overwhelming dominance in supercomputer technology.
The San Jose Mercury News says an IBM system in Livermore and an SGI system in Mountain View placed first and second among the 500 fastest supercomputers in the world, based on a National Research Council report released yesterday.
Of the top 500 fastest supercomputers, "IBM and Hewlett-Packard alone accounting for 78 percent," write Glennda Chui and Therese Poletti, adding that "Sixty-four percent use Intel processors."
What are the two fastest systems used for? According to Chui and Poletti:
While the Livermore machine mostly will be devoted to classified weapons work, it also will be open to researchers who want to design new materials and study interactions between molecules, among other things.The Ames supercomputer, called Columbia after the lost space shuttle, will be used to model the flight of the space shuttle before it returns to service, as well as forecast hurricanes and earthquake activity, simulate the death throes of dying stars and analyze how genes work in the human body.
Kudos to Chui and Poletti who provide more details about the supercomputers and their use than a story about the NRC report in today's New York Times.
The US government should triple its investment in supercomputer research to stay ahead of competitors, notably up-and-coming China, the report says.
Emphasize the homeland security angle and the money will pour in like Noah's flood, I expect.
Links:
Supercomputer mastery at risk: No. 1 U.S. Must Apply Itself, Report Saysby Glennda Chui and Therese Poletti, San Jose Mercury News
OnlineJournalist.org, edited by Doug Millison "on a need-to-know basis"
November 9, 2004 |
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November 8, 2004
People Watch: On meeting Bill Gates at the urinal
by Doug Millison for SiliconValleyWatcher.com
Heard the one about the men's room encounter between Bill Gates and Joe Kraus, founder of Excite.com during the dot-com boom and more recently of JotSpot?
Silicon Beat recently re-blogged a story Kraus told in his own blog (it's called Bnoopy). His fateful encounter with Gates came when Microsoft was negotiating to buy the Excite.com Internet portal. (Remember portals?) Kraus writes:
During one of the negotiating sessions (with the good cops), Vinod and I took a break to hit the bathroom. Vinod pushes open the bathroom door and there, standing slightly hunched at the urinal, was a small man dressed in a sweater. "Holy shit" I said to myself. "It's Bill Gates."Imagine you're facing three urinals. Bill taken the right-most. Vinod takes centerfield and I'm out in left.
Vinod looks over at Bill.
"Hey Bill".
Bill looks back at Vinod "Hey Vinod, who are you here with today?" (today? now is that a telling question or what.).
"I'm here with the Architext guys. This is Joe Kraus".
Let me pause this dialog to say two things right now.
1. what is the appropriate bathroom etiquette? I had a massive internal struggle. Do I reach over the urinal barriers to extend a handshake to Bill? What would he do if I did?
2. I had complete urinal performance anxiety. I had not been able to pee up to this point. Nothing was happening in the presence of the man who brought us greatness like Microsoft Decathlon and the Blue Screen of Death.
What did I do? I said hello and then stood there silently not knowing what to do or say.
Shortly thereafter, Bill finished up, backed away from the urinal, washed his hands and left.
"Bye Vinod."
I should have shaken his hand.
I'd like to think I would have washed my hand first. But, I've never had that go for the, er, jugular instinct that is the hallmark of the successful Silicon Valley entrepreneur.
Links:
Potty Talk, at Bnoopy, 29 September 2004. (Silicon Beat recently re-blogged the anecdote.)
Media Watch: JotSpot's the golden boy today, Silicon Valley Watcher, 6 October 2004
November 8, 2004 |
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November 5, 2004
PR Watch: The British invasion of the Silicon Valley PR sector continues
Bite Communications hosted a party Thursday evening to celebrate its new offices on 345 Spear Street, a neighborhood that is attracting a growing community of PR professionals. Bite is a British PR company and has become a major player in Silicon Valley over the past year or so, especially following its acquisition of Applied Communications.
The usual Silicon Valley Hack Pack showed up -- Quentin, Don etc. I arrived with my former colleague at the Financial Times, Louise Kehoe. Louise, by the way, is doing some interesting work as a media consultant. Louise has been around for a long time and she knows a lot about the underbelly of Silicon Valley. I’m hoping to convince her to write an occasional guest column for Silicon Valley Watcher.
Chris Nuttall, newly arrived off the boat, was also at the party. Chris just started working in the Financial Time’s San Francisco bureau and will be covering many of the same news beats that I used to cover before I left in June to start my own media ventures. For those that have yet to meet Chris, let me introduce you. Chris is a very nice man with a lively sense of humor and knows his way around tech and the telecoms sectors. He used to work at the BBC and various trade papers.
It was also nice to bump into Jeff Lettes at the party. Jeff is head of corporate communications at Applied Materials and has been doing a sterling job at Applied for many years. This has not been an easy position. The chip equipment giant has had to go through several reorganizations to adjust to brutal market conditions within the chip equipment market. I can think of a few other Silicon Valley companies that could benefit from that kind of expertise.
Emma Wischhusen from Text 100 public relations was also at the party and looking very well considering that she had a very unpleasant encounter with some shellfish earlier in the day that caused an allergic reaction. It was also nice to see Whitney Cubbison from Bite. Whitney was absolutely radiant and when I asked what was causing it she told me she had just recently married and she is transitioning to her married name Whitney Burk. Also, I have to mention Daniel Bernstein from Bite. Daniel is a new recruit and has just been in the PR industry for about five months, but I think he will do very well. Plus, he promised to show me one of his party tricks, something to do with drinking beer. “It’s very impressive,” one of his colleagues vouched. I can’t wait.
I also had interesting chats with people from Hewlett-Packard, Cisco Systems and others. And in the spirit of full disclosure as part of our “Up Front” policy, I did pitch them on a foundation sponsorship opportunity for Silicon Valley Watcher and our coming media titles (more on that later!).
The most interesting part of the evening was meeting Tim Dyson. Tim is very unassuming but incredibly well connected. Tim is the main man behind a very bold and aggressive British invasion of the Silicon Valley public relations sector. I’ve known about Text 100, the other large British PR firm operating out here—-but I didn’t realize that Bite was originally spun out of Text 100 to resolve a conflict of interest issue when Text 100 won the Apple Computer account in the mid-1990s (hence the “Bite” name).
I knew Mark Adams, one of the founders of Text 100, when I worked in London in the early 1980s when it was just a two-person shop. Tim Dyson became employee number 6 at Text 100 and recalls working with me on Microsoft stories when I was at Computing, the leading UK trade weekly.
Tim has come a long way since then. He is Group CEO of Next Fifteen Communications Group, the holding company for Text 100, Bite Communications and August.One. Next Fifteen is Europe’s largest tech PR company and is a public company. I had no idea that this relationship existed between Text 100 and Bite. And it is interesting that the two PR firms operate autonomously and are fiercely competitive with each other. It’s a fascinating business strategy and one that seems to be working very well judging by the large clients that they have been winning.
Tony mentioned that Silicon Valley Watcher is getting a lot of traction and is being widely circulated. Obviously, this was extremely welcome news. My philosophy in launching Silicon Valley Watcher, and the other Silicon Valley media titles we have in the works, is that we should not need to spend a dime on marketing. Our community of readers are the ones that will invite others to read Silicon Valley Watcher. And they will only do that if we have content that is valuable and interesting to them.
This is an important point and it is something that I regularly tell my team--if people are circulating our content then we are doing our job. The people that read Silicon Valley Watcher are those that were “invited” by their peer group. We do not want millions of eyeballs—we just want the right eyeballs. The decision makers here in Silicon Valley are deciding on a global future. These are elite insider groups and our job as reporters and editors is to know those communities, be part of those communities, and be known by those communities. We have to produce compelling, quality content, that is our number one job. That is how we will build our readership—not because of marketing. And our readers become our gatekeepers, they are the ones that invite others by spreading our content.
Although we are still very much in beta, when we launch our other Silicon Valley Watch titles early next year, Media Watch, PR Watch, Tech Watch, VC Watch and Silicon Valley Bunion—it has to be the quality of our content that wins readers—not marketing. And in many ways, I think this approach will become increasingly important for many Silicon Valley companies and is a topic I’d like to discuss further in future articles.
November 5, 2004 |
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Friday Watch: No cancer risk for employees, IBM claims
by Doug Millison for SiliconValleyWatcher.com
Surprise! A study commissioned by IBM finds no increased cancer risk for employees in a Silicon Valley plant and two others.
Therese Poletti reports in the San Jose Mercury News that the IBM study seeks to reassure 126,000 employees at East Fishkill, New York; Burlington, Vermont; and San Jose, California.
Big Blue commissioned the study in 2000 when it was "facing lawsuits by former employees who alleged they developed cancer because of exposure to toxic chemicals while working at the company's plants," Poletti writes, noting that the study "has not yet been published by a peer-reviewed scientific journal."
Poletti quotes Joe LaDou, director of the International Center for Occupational Medicine at the University of California-San Francisco, who questions the methodology of the IBM study: "It is not acceptable science but it is often done by industry-supported researchers, and sometimes even by governmental agencies.''
Over the years, a bevy of experts and activist groups have warned that employees at chip factories and other manufacturing facilities in Silicon Valley face health risks from the toxic chemicals at the workplace. Leaks of these chemicals have poisoned ground water, too, threatening Silicon Valley residents who choose not to purchase bottled water for drinking and cooking.
Poletti notes that "In March, IBM settled 50 other suits filed by former San Jose workers," and that "The company also has settled two birth-defects cases in New York state. About 110 cases still are pending in New York."
Links:
IBM says cancer risk not greater by Therese Poletti, San Jose Mercury News, 5 November 2004
Silicon Valley Toxics Coalition , activist and watchdog organization
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November 5, 2004 |
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Friday Watch: Life goes on
by Doug Millison for SiliconValleyWatcher.com
It's been a tough week for Silicon Valley and the greater San Francisco Bay Area. Most of us voted for Kerry (over 80 percent in the city of San Francisco) and it's difficult watching Bush smirk and sneer as he enjoys his moment in the sun. There was much weeping and wailing and gnashing of teeth on Wednesday. High tech executives remain unsure what opportunities may unfold, or slam shut, in the second Bush term, while California as a whole braces for payback after having voted for Bush's opponent, and for embracing lifestyles that infuriate Bush's right-wing, fundamentalist Christian supporters. But even as reality sinks in, Silicon Valley finds some reasons for hope.
Michael Moore - after sending out an email called "My First Thoughts About the Election" which simply listed the names of the American dead in the Iraq war - now offers "17 Reasons Not to Slit Your Wrists." Numbers 14 and 15 are especially good:
14. Bush is now a lame duck president. He will have no greater moment than the one he's having this week. It's all downhill for him from here on out -- and, more significantly, he's just not going to want to do all the hard work that will be expected of him. It'll be like everyone's last month in 12th grade -- you've already made it, so it's party time! Perhaps he'll treat the next four years like a permanent Friday, spending even more time at the ranch or in Kennebunkport. And why shouldn't he? He's already proved his point, avenged his father and kicked our ass.
15. Should Bush decide to show up to work and take this country down a very dark road, it is also just as likely that either of the following two scenarios will happen: a) Now that he doesn't ever need to pander to the Christian conservatives again to get elected, someone may whisper in his ear that he should spend these last four years building "a legacy" so that history will render a kinder verdict on him and thus he will not push for too aggressive a right-wing agenda; or b) He will become so cocky and arrogant -- and thus, reckless -- that he will commit a blunder of such major proportions that even his own party will have to remove him from office.
The many groups that fought so hard against Bush during the election campaign seem to be gearing up to oppose his most egregious legislative and executive efforts - and watch for anti-war protests to start up again, too.
Links:
17 Reasons Not to Slit Your Wrists by Michael Moore; scroll down for "My first thoughts after the election..."
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November 5, 2004 |
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November 4, 2004
Bio-tech Watch: California makes stem-cell end-run
by Doug Millison for SiliconValleyWatcher.com
Bush voters may have embraced his anti-stem-cell politics elsewhere in the US, but Californians soundly rejected them, paving the way for Silicon Valley to take a bio-tech lead.
Andrew Pollack, writing in today's New York Times, explores the ramifications of the "vote by Californians to spend $3 billion on human embryonic stem cell research could speed progress on the promising but controversial field and make the state the epicenter of such research."
The measure will establish a "California Institute for Regenerative Medicine, which will become the largest single backer of research in stem cells - a field that scientists hope might eventually be used to create new brain cells for patients with Parkinson's disease, or insulin-producing cells for diabetics, or treatments for numerous other diseases."
The San Francisco Bay Area already boasts a heavy concentration of genetic engineering and other bio-tech firms. Pollack's article notes that some companies have already announced plans for new stem-cell research facilities in the state.
Links:
Measure Passed, California Weighs Its Future as a Stem Cell Epicenter by Andrew Pollack, New York Times, 4 November 2004
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November 4, 2004 |
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November 3, 2004
PR Watch: PR companies and their tech clients are starting to notice bloggers
I had an interesting chat with Christina Armstrong the other day. Christina has been working in the valley for many years and is one of the best PR professionals around. She said that the blogging phenomenon has left many PR companies and their clients baffled about what to do.
PR companies know how to work with traditional media, but they are not sure how to work with bloggers. That indecision has led to no action at all. But now, Christina says that things are changing. “Some PR companies, and also their clients, are beginning to ask, 'which are the most influential blogs?'”
This can be a tough one to judge. It is difficult to audit the readership of blogs. RSS feeds and the re-posting of stories and entries across the web is difficult to track. Yes, there is “trackback,” which is integrated into blogging software and can track links to a specific blog entry. But spammers have forced many blogs to turn-off this feature.
And the influence of a particular blog is not necessarily connected to the traffic to a particular blog. The readers of this blog, for example, are mostly Silicon Valley companies and their business partners. Our readers are small in number compared with say, News.com, but they are in the top echelon of the world’s top decision makers. They decide on the design, components, and technologies used in millions of digital products that are manufactured in factories around the world. They also finance huge amounts of innovation, which sets the direction of many sectors, not just tech, but also life sciences, etc.
And Silicon Valley executives do read blogs. In fact they do almost all their news reading online, except when they are sitting in a plane: that’s the only time print publications have a chance of reaching this elite group of decision makers. (Hey, there's an idea: a business publication that is ONLY available on airplanes?!)
In terms of blogging, Silicon Valley tech and PR companies are at least beginning to recognize the importance of this fragmented media channel. It will be interesting to see how PR companies will approach this challenge, and how they will seek to influence the “influential” blogs.
November 3, 2004 |
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Tech Watch: Bush win won't ease tough overseas tech markets
The re-election of President Bush was not a welcome outcome for some Silicon Valley companies. I know several tech company executives who have been complaining that US foreign policy has not been good for business in Europe. With about 50 per cent of revenues for many tech companies coming from overseas markets, US foreign policy can have a large effect on business--especially for many small companies.
Tech markets are tough enough for Silicon Valley companies without having to also deal with the negative connotations of being a US company in today’s world. There was hope among some local companies that a John Kerry win would set a course of improving US foreign relations and that this would help business.
However, Kerry’s support in Silicon Valley was tempered with uncertainty over his stance on offshoring. Although most local startup companies offshore very small amounts of their engineering work, there had been concern that the government might limit their future ability to use offshore development facilities.
Interestingly, it is the venture capital firms that have been pushing their startup companies to use offshore development facilities. One entrepreneur told me, “Most of the venture capitalists are insisting that business plans include an offshore component, otherwise they will not look at it.”
The venture capital firms will reduce the size of their investment to make up for the savings that offshore development work can save a venture—but the milestones remain the same. Very crafty: the VC’s take the savings upfront!
Interest in politics, however, is rare. I would characterize most Silicon Valley executives as “libertarian” in that they want as little government involvement in their ventures as possible (except, of course, for government research grants!).
Gary Reback, an attorney at Palo Alto's Wilson Sonsini Goodrich & Rosati, is concerned however that Washington, D.C. does not understand the tech industry and that this ignorance could harm the US tech sector. When I met with him recently, he was considering writing a book to highlight some of the potential problems he sees in the future in regard to possible US government actions and their effect on the technology industry. For those who have short memories, Mr. Reback helped lead the fight against Microsoft’s anticompetitive practices.
November 3, 2004 |
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November 2, 2004
Academia Watch: TechnoFeminisms
by Doug Millison for SiliconValleyWatcher.com
How deep have computers penetrated the humanities? Pretty darn deep, judging from this recent Call For Papers to be presented at a Canadian conference next year.
Call for Works: TechnoFeminisms: New Cultural MediationsAbstract Deadline: December 15, 2004
Even before Donna Haraway identified connectivity as the key to women's liberation from the tyranny of patriarchal structures, and the cyberfeminist collective, VNS Matrix, identified the clitoris as the direct line to the matrix, feminist artists and critics have been searching for ways of using technology to speak outside of the expected parameters of well-behaved bodies, restrictive language and linear ideas. We seek (post)feminist art, works or performances that use technology to explore the new cultural mediations of our information age. We are looking for pieces that expand the boundaries of art, gender, bodies, interactivity, networks, media, technology and/or criticism rather than traditional academic papers.
Links:
Call for Papers Announcement, for The Networked Citizen: New Contributions of the Digital Humanities, at the Consortium for Computers in the Humanities / Consortium pour Ordinateurs en Sciences Humaines (COCH/COSH) 2005 Meeting of the Congress of the Social Sciences and Humanities, The University of Western Ontario, May 29 - 31, 2005
Canadian Women's Studies Association
OnlineJournalist.org, edited by Doug Millison: "on a need to know basis"
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November 2, 2004 |
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Tech Watch: A Slimy Graphics Algorithm
by Doug Millison for SiliconValleyWatcher.com
A University of California, Berkeley researcher has developed a new way to animate viscous, bubbling, and oozing fluids that promises to make "movies, videogames, and even surgical simulations much closer to reality," writes David Pescovitz in the latest issue of Lab Notes, a publication of the university's engineering department.
"For quite some time, we've had mathematical models for simulating idealized solids," Pescowitz quotes James O'Brien, a professor in UCB's Department of Electrical Engineering and Computer Sciences. "And we have other models for simulating idealized liquids. But there are many materials that are in between. They may look like solids, but they also can flow like liquids."
Reports Pescovitz, "The algorithm O'Brien developed with graduate students Tolga Goktekin and Adam Bargteil takes existing fluid simulations and adds the ingredient that gives materials like toothpaste, motor oil, and dish soap characteristics of both liquids and solids."
Links:
A Slimy Graphics Algorithm by David Pescovitz, Lab Notes, Volume 4, Issue 8, October/November 2004
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November 2, 2004 |
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People Watch: Intel CEO begs forgiveness
by Doug Millison for SiliconValleyWatcher.com
Intel CEO Craig Barrett got down on his knees and begged forgiveness for cancelling the 4-gigahertz Pentium 4 chip.
Reports the San Jose Mercury News today:
Intel Chief Executive Craig Barrett is known for his dry sense of humor. He also has good-naturedly participated in some odd marketing stunts, such as the time The Blue Man Group brought him out on the stage at the 2001 Consumer Electronics Show by causing his head to emerge from a mound of wobbling Jello.But at Gartner Group's recent Fall Symposium/IT Expo in Orlando, Fla., Barrett took CEO humiliation -- or humility, depending on your view -- to a new level. During an interview on stage with Gartner analyst Martin Reynolds, Barrett got down on his knees. In front of an audience of about 7,000 information-technology professionals, Barrett asked their forgiveness for the Santa Clara company's latest product slip-up, the cancellation of its 4-gigahertz Pentium 4 personal-computer chip.
"Is it a missed commitment? Absolutely. Would we have preferred not to miss that commitment? Absolutely? I get on my knees in front of the audience, forgive us," said Barrett, according to a transcript of the event.
Barrett also acknowledged for the first time that Intel's plans to develop all future chips with two processors was a move to "avoid the power challenge." As chip makers pack more and more transistors into chips, the chips generate excessive heat.
Links:
Tech Notebook: Barrett eats humble pie over product snafu, by Therese Poletti, Michael Bazeley and Dean Takahashi, San Jose Mercury News, 2 November 2004
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