Silicon Valley Watcher - at the intersection of technology and media

Yesterday I made the case that Google's Nexus phone is nothing without the network. Whatever wonderful software and features Google and partners pile onto the phone, it is the network operators that have the final say on whether they will allow it -- which is why Google needs to own its own Telco more than it needs a branded phone.

Google cannot risk being cut off, or positioned a couple of clicks away because of a future decision by a Telco. If it owned its own network it wouldn't ned to worry about this issue.

Analysis: GOOG Needs To Have Its Own Telco Service More Than It Needs A Phone...

Here are some additional points to ponder:

- One of my readers suggested that Google could make an investment in a Telco that would ensure a couple of board seats -- that way Google wouldn't need to operate the Telco business itself and that would guarantee not being thrown off the network.

I don't see this as working because there would be too many conflicts of interest. Board members are chosen so that they can offer the best possible advice without a conflict of interest. GOOG has many areas of overlap with a Telco ranging from advertising to services such as Google Voice.

- Wouldn't net neutrality regulations protect Google and others?

No, not really because a Telco could decide to put Google's services a couple of clicks away from a cell phone's home screen. It is isn't preventing access to Google but it's not making it easy. It would be impossible to have a net neutrality regulation that guaranteed rights to a mobile phone's home screen.

- Why would Google sell it's own branded phone and compete with handset makers such as Motorola and others?

It doesn't make sense except to make sure that the Android standard doesn't fragment into many slightly different, but incompatible versions. That's what harmed Unix for many years. This way there will always be one true standard, the Nexus One, and that will discourage handset manufacturers from customizing their Android phones with proprietary features.

- What's Google's long term plan with mobile, what comes next after the Nexus?

The Nexus phone shows that Google is very serious about mobile. Eric Schmidt has publicly said on many occasions that the mobile web is a much larger business opportunity than the desktop/laptop search market.

But it's a totally different market where there is a lack of software and hardware standards as in the PC market. And for good reason: the Telcos and phone makers fought against Intel and Microsoft's attempts to standardize these markets in the same way that they succeeded in standardizing PC markets with their proprietary technologies.

In the PC market, Intel and Microsoft managed to aggregate most of the value-add. Their duopoly managed to maintain huge profit margins in the 60% plus range while PC makers, and others have had to survive on razor thin profit margins of just a few percent. The Telcos won't let that happen to their industry.

This means Google has to play by the rules of the Telco industry. It will need to pay for access.

It will pay the Telcos for prominent position on handsets and to guarantee that users have easy access to its services.

The iPhone holds the clues. Google pays to have its search box easily accessed on the iPhone. It also has prime position for its YouTube service on the home screen - you can't delete this icon like you can with downloadable apps.

This is the model for Google moving forward - paying the Telcos for position and access to mobile users.

Making such payments is nothing new for Google. In its most recent financial report it paid $1.59 billion to third parties for access to search traffic. These 'Traffic Acquisition Costs' (TAC) were 27% of its total advertising revenues. This was mostly to third-party web sites. In the future, it will be increasingly paid to Telcos.

This is a far better strategy than owning your own Telco. It's better because:

- It doesn't need to make a very expensive and complex Telco acquisition and deal with the government regulations.

- By not owning a Telco it can hit back at competitors and better control its partners. That's because it can use its money to buy clout. Smaller companies don't have the resources.

If Google had its own Telco it would feel obligated to ensure fair access to all. This way, it can hide behind the self-interest of Telcos and their control over their network and services.

And that's what will be next after Nexus: Google will make deals with Telcos to ensure its mobile services have prime positions.

- The Telcos will agree because Google can monetize the mobile phone screen real-estate -- and the network bandwidth -- better than the Telcos can themselves.

- The Telcos get paid and the business deal acts as barrier to entry for any Google competitors.

What's Microsoft going to do? It will have to follow suit. It has a mobile OS, it has relationships with the Telcos, it has the financial means to muscle in on similar type deals.

The losers will be the thousands of startups that won't have the same easy access to mobile users. They will be forced to partner with Google, Microsoft, or the Telcos, on their terms.

This means less innovation, less competition, and continued high prices for mobile access -- a digital divide far greater than the one on the desktop.

- - -

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To help subsidize my habit (publishing SVW) I'm now offering business strategy consulting services including media strategies. First come first serve. You should contact me here: tom (at) foremski.com or 415 336 7547.

Do we really live in an open web or is it only open until some companies say it's not?

Is the web truly open when companies such as Twitter, Facebook, MySpace, etc, can close the door to their data, or prop it slightly ajar?

With so many social networks and Web 2.0 applications it helps if third-party applications and services can access each other's data streams, especially if it is users wanting to aggregate their own media activities.

This is done through publishing an application programming interface (API) that specifies how other programs access your data.

But what is to be gained by doing this? Well, lots of pats on the back from the influential geekerati on Techmeme, who love open APIs because they look at the world from a user's point of view.

And there are other advantages, especially in the beginning because APIs allow many other services and applications to flourish, which helps spread your own service.

But open APIs can become closed or restricted at anytime.

For example, Friendfeed aggregates people's blog posts, Facebook activity, Youtube videos, Twitter posts, comments, etc. It does that because it has been granted permission to access user data from all those sites.

Steve Gillmor over at TechcrunchIT reports that Twitter has begun restricting its feed to Friendfeed (recently acquired by Facebook). He says Twitter is trying to "kill" Friendfeed.

Competitors will always seek to restrict their competition.

Of course Twitter turned them off. Facebook is Twitter's self-declared number one competitor. When you own the platform and the protocol you have every right to protect your own arse. In fact they have an obligation to their shareholders and investors.

Open APIs are a key foundation of Web 2.0. Yet this whole industry is being built on a very shaky foundation, one that can be closed at any moment.

If the world of open APIs is temporary then the open APIs are useless.

Why would anyone attempt to build a new service or product that relies on open APIs when that access can be restricted or closed at anytime?

Why would it the web become closed?

Because there's money in proprietary systems. Closed systems make money. It's much more difficult to make money in an open industry standards world.

Look at the PC industry with its razor-thin margins on PCs, while Intel and Microsoft make 60% plus margins on their proprietary PC technologies.

Look at Apple Computer and the fortunes it makes through its closed systems.

It's the traditional way money is made in the computer industry.

Open systems are anomalies.

I remember when email was first out, I started using MCI mail. But I also had to have a CompuServe, and an AOL account because there were no gateways between the systems. It took years before you could send an email seamlessly between systems.

It wasn't because the technology wasn't available, it was. It was because you could make more money by not having a gateway.

There are very few open industry standards that arose because companies agreed, and then only after many years of slogging through a tedious standards process.

The Internet is a collection of open industry standards that succeeded only because the US government financed and supported it. And it still took years to become well established.

But we've always had industry de facto standards. That's because one company eventually won out over all the others, and that's what we all began to use, their standard.

Is the X86 microprocessor architecture an open industry standard? No, it's a de facto industry standard developed by Intel. That's why Intel can maintain 60% plus profit margins.

Why should Facebook, Twitter, Yahoo, Microsoft, Salesforce, Google, or any other company with a valuable data stream, promise to give open access, to anyone, at anytime?

It would be opening itself up to competition. It would be giving up a key competitive advantage and a key competitive differentiator.

Where's the monetary value in doing that?

If open APIs can be changed at any time then they are not open, but ajar. This threatens the entire Web 2.0 sector. This is a very serious issue.

Chris Saad writes:

In the end, the only real solution for all of this, of course, is a return to the way the web has always worked (well). Open systems.

He is right.

But open standards will be years in the making, and in adoption. In the meantime, it looks like we will be heading into a closed web of the like that we haven't seen since before the Internet.

That's going to restrict innovation to a tremendous degree.

UPDATE: Craigslist blocks its data from Yahoo Pipes.

Don't be evil, Craigslist - Startup diaries

Yesterday (Nov 30th 2009), at approximately 2pm PST, Craigslist effectively killed all Yahoo Pipes projects that use Craigslist as a data source.

As the Twitterati, (and FriendFeederati,) abandon blogging and past-tense sites, is this a sign of the next phase of online media? It seems that way.

So what will happen to online advertising, and the "old" media? There's no real-time ad networks right now and none on the real-time media that I see.

The old media (we used to call it mainstream) has barely gotten used to the "Always-On-Media" of blogging, etc. Now they have to jump into the real-time web.

And they can't.

Because there isn't a business model in the real-time web. (Just as there isn't in online media.)

By the time they jump in, there might be a business model then. Maybe. But I bet it won't be enough to support professional work.

Things are very interesting in media and PR communications these days. Things are changing so fast and we are all learning so fast. The changes happening in our industries are unprecedented, we have no frame of reference except our old ways.

For much of my 25 years in Silicon Valley I've been reporting on innovation and what people have been doing in software, IT systems, chips, etc. These days, the innovation isn't so much in technology, but in media communications.

These days I spend a lot of time talking with reporters about the changes in media and PR. There is a tremendous amount of innovation happening in media communications: Twitter, Friendfeed, Facebook, etc, represent just a tip of an iceberg, a tip that barely existed a year ago, what will be there next year?

And that's what's great about all of this innovation in media communications, that we are in the midst of it, and that we get to help create the future. We get to make the mistakes, and we get to discover and create things that no one has ever done before. It's like making fresh footprints in the snow. It's not often that we get to do that.

Rupert Murdoch wants a Google rebellion, says Forbes. Murdoch calls Google, Yahoo copyright thieves, says Wired. Newspaper groups step up propaganda war on Google, says the Daily Telegraph. And in today's New York Times, A.P. seeks to rein in sites using its content.

The saber rattling has been going on for a while but now the battle lines are being drawn. And it is all because news is not free. News has been made available for free, and it has been made into a commodity but that is not its future because there is no future in that model. You will have to pay for it.

That means the end of the news aggregators. That means the end to arguments that the news aggregators send high volumes of traffic to the online publishers.

What is the use of more traffic when it cannot be monetized to support the work of the news organizations?

The only "news" that will remain free will be press releases--but there is little value in that type of unfiltered "news" source.

But, there may be a solution to keeping news free, one that takes advantage of the distribution power of Google, bloggers, and the large number of of social network users sharing content -- while at the same time making some money for the media companies.

In Monday's NYT article: Associated Press Seeks More Control of Content on Web

They [A.P. executives] said they did not want to stop the appearance of articles around the Web, but to exercise some control over the practice and to profit from it.

I have a solution: A content license for any online site that also publishes the content owners' designated ads.

For example, if you republish a news story you also publish alongside it one or more "adtribution" links, simple text ads with live links, designated by the content creator.

In this way, news media companies get a big benefit from having their news stories distributed for free by the news aggregators, bloggers, and online socialistas -- and their advertisers also get the distribution, which would improve ad revenues for the content producer. News would (might) remain free.

Adtribution links would "stick" with the content. These days fewer and fewer people visit a news site, they read news stories in their RSS newsreaders, or on news aggregator sites. News content is ever more becoming divorced from its web site, which means so are its advertisers.

Adtribution links could be sent along with RSS feeds and help reunite content with its supporting advertisers.

It would be simple to automate it, news aggregators and blogging software could be set up to automatically copy a set of associated live ad links, at the same time the content is copied and pasted.

Adtribution links could be attached to any shareable, embeddable media. And they could be widgetized so that their ad content could be changed at any time.

In some cases, sites that republish content might agree to run adtribution links in a permanent part of their page, so they aren't directly next to the content, for aesthetic or other reasons.

Would something like this be enough to appease the newspaper industry and keep our news free?

Will bloggers etc, be willing to republish text ads? Probably not. But they could get used to it. We can all get used to it.

I remember the hue and cry in the early days of the Internet that users would not tolerate advertising on the Internet. We got used to it, and I predict we'll get used to many more online business models. Some will work.

Here's a catchy slogan: "Adtribution supports the source." Maybe the media moguls will catch notice.

- - -

Please see:

Silicon Valley Watcher:

"Google Devalues Everything It Touches" - Wall Street Journal Chief

FutureWatch: The End Of The News Aggregators And The Future Of News

Support the Source: Creating a New Media Business Model and Keeping the Web Open

Virtual cash could save newspapers | Tom Foremski: IMHO | ZDNet.com

Newspapers: 25 things to try before turning off the lights | Tom Foremski: IMHO | ZDNet.com

People are advised to watch what they post or upload because it might come back to haunt them. Drunken photos, drag costumes, sexist or racist jokes, etc could cost you a job, a relationship, or damage your reputation in the future.

The warning is that if it goes on the Internet, Google, in its earnest desire to index all of the world's information, will index all of your embarrassing stuff too. A simple search will easily reveal a checkered past.

But is this really true?

I Googled "Tom Foremski" and came up with a search result of 135,000 links. Each page showed 10 links related to my name. I wanted to see how far I could go, what would be the very last of the 135,000 search results? But after 55 pages, or 552 links, Google could show me no more, and I got this message:

In order to show you the most relevant results, we have omitted some entries very similar to the 552 already displayed. If you like, you can repeat the search with the omitted results included.

So I clicked on "repeat the search with the omitted results included." This time I only got 20 pages of results or 196 links. I got less instead of more.
Either way, the most web pages I could find with "Tom Foremski" was 552. Yet Google had indexed 135,000 pages with my name on them. This was just 0.4 percent of the total.

If someone were checking up on me, they would only be able to see 0.4 percent of everything on the Internet that is indexed "Tom Foremski."

So while it may be true that the Internet will store everything forever, it is not true that an employer or anyone else, will be able to Google you and easily find things you wish weren't there.

My advice to anyone that is worried that others might judge them for youthful or other indiscretions, is to make sure to be very active on the Internet, because only a small fraction will be accessible if you get Googled. Anything bad will be diluted into the long tail of you.

Of course, in the future Google might be replaced by superior search engine that will provide access to all of its index. But even then, slogging through tens of thousands of links would discourage the most diligent of employers.

However, watch what you post is still good advice.

Anti-Twitter mania will hit the media very soon. For now, mainstream and newstream media is still in a honeymoon period with Twitter.

Earlier today, Ev Wiliams, co-founder of Twitter was on Charlie Rose, and there have been many favorable news articles discovering Twitter as if for the first time.

The next stage in the media landscape for Twitter is to knock it down. I already see the seeds of the pushback in conversations I've had with people in journalism, PR, marketing, communications, etc.

The popular point of view is that the 140 characters that Twitter allows is not enough to express much of anything. But that's not my point of view.

When I first became a journalist blogger nearly five years ago, my buddy Om Malik would say, "Dude, you write too long." And Om was right. I came from a newspaper background where we were taught to fill space. Working at the Financial Times our editors would tell us how long our news stories should be. And we would try to fill that space.

We would often get calls from our desk editors asking us to come up with another 100 words or more for a news story because the page had been redesigned for a later edition. We were filling space.

But when I became a "journalist blogger" I realized that there was an interesting switch. Writing for a newspaper, where there was always a finite amount of space, I was often asked to stretch a story to fill the space. Yet online, where there was an infinite amount of space, writing less was always better.

That was one of my many "aha" moments regarding blogging, that less is more. And over the past few years the trend has been towards even less.

So, at first glance, Twitter critics might seem right in saying that 140 characters is not enough space to communicate ideas.

But if you can, I can guarantee you will be a far more successful communicator.

And if you want to go viral, expressing your idea in 120 characters or less is even better (so that others can retweet:)

Like it or not, 140 characters or less, is currently a new container for ideas. And that makes things interesting.

- - -

Please see Twitter co-founder Ev Williams on Charlie Rose:

I recently met with Bill Coleman, one of Silicon Valley's most impressive entrepreneurs over the past 30 plus years. He's been at VisiCorp, Sun, he founded BEA Systems (sold to Oracle for $3.5bn), etc. His analysis of Silicon Valley's future is fascinating.

What was especially interesting about our conversation is that he doesn't see green/clean technologies as a disruptive technology. Yet Silicon Valley leads this nascent industry.

Mr Coleman says that green technology doesn't follow the Peter Drucker rule of being a disruptive technology, which means being 10 times better or cheaper than what was there before.

"In the green market, what we're displacing is cheaper per unit than what is displacing it. It won't be driven by a tsunami of adoption." He says companies and individuals will take their time before adopting more expensive green technologies, especially with the current economic condition.

However, this could change if President Obama's administration adopted a plan of offering incentives for the development and use of green technology. He says this would be a far better stimulus package.

"There are lots of benefits for humanity, but the economics of the green market won't drive a rapid adoption unless there are incentives."

Mr Coleman is a critic of the current government stimulus package, that focuses on physical infrastructure projects. He says that incentives for green technologies would create better quality jobs and have a longer term economic stimulus effect than pick and shovel jobs that end after the project is done. Green technology jobs have a longer life span than bridge or road projects.

Plus, infrastructure projects slow capital formation, he says, which is needed to fuel the next recovery.

Cloud computing, biotech, and nanotech are examples of Silicon Valley's best disruptive technologies, and they don't need any government incentives, says Mr Coleman. And these are industries where Silicon Valley leads.

The recession will hit hard, says Mr Coleman, but Silicon Valley will survive because it reinvents itself every ten years.

You can read the rest of the interview here:

Thought Leader: A Conversation With Valley Veteran Bill Coleman About The Economy And The Business Of Disruption . . .

2009 global chip sales could plunge by as much as one-third in 2009 says market research firm Gartner.

Mark LaPedus at EETimes reports:

Worldwide semiconductor revenue is forecast to reach $194.5 billion in 2009, a 24.1 percent decline from 2008 revenue. Market research firm Gartner also warned that its ''negative scenario'' could reach a 33 percent decline in 2009.

The chip industry is expected to start growing in 2010 but even with three years of growth, 2012 revenue will still be below 2009 revenues.

Worldwide IC revenue is expected to fall by at least 17 percent sequentially in the first quarter of 2009. There is a strong possibility that the first quarter of 2009 could be worse, and if the market continues with moderate declines in the second and third quarters of 2009, the industry could face a record annual decline.

EETimes.com - Gartner cuts IC forecast, sees 24% drop

The decline Information Technology (IT) markets will be relatively modest compared with the chip market. IDC expects growth of 0.5 per cent in global markets. Hardest hit will be hardware spending on servers, printers and PCs, which are expected to drop 3.6 per cent in 2009. Software and services are forecast to grow 3.4 per cent.

IDC also said that global server sales plunged 14 per cent in Q4 2009 compared with the year ago period. This also marked the first time sales were lower in all three server sectors: volume, midrange, and high-end.

Tech Trader Daily - Barron’s Online : Global 2009 IT Spending Will Barely Grow, IDC Says

Foremski's Take:

Lower chip and hardware sales will affect Silicon Valley companies such as Intel, Hewlett-Packard, and Sun. Spending on software and services will benefit IBM, the world's largest computer services company.

Although the chip industry will be down significantly this year, chip companies are used to a four year cycle of boom and bust. It is in the bust part of the cycle that chipmakers such as Intel (Intel is an SVW sponsor) invest in building chip fabs so that they are ready for the next boom period. Intel recently said it would invest $7 billion new manufacturing facilities in the US over the next two years.

Intel to invest $7 billion in U.S. facilities - MarketWatch

The other day I got into trouble with Cisco's outside PR agency, the 463 because John Chambers, Cisco CEO continued to complain about education in the US, saying the same things he has been saying for many years. So I complained that I've been hearing these same things time and again. (Please see my TechNet post: John Chambers Marks Dull Innovation Summit Panel- Content Was"Slightly Less Useless" Than Prior Panels )

Among Mr Chambers comments, he said that our local school system is broken and can't be fixed.

I was on a panel with Mr Chambers two years ago. I spoke about how Silicon Valley's public schools are basketcases when they should be showcases.

It is embarrassing. Silicon Valley says to the world we are inventing the future yet our communities suffer from terrible public schools! Is this the future?!

He said Tom, we tried to tried but the system is broken and can't be fixed. And he said the same thing last Thursday too. Cisco was a big supporter for school vouchers, a controversial proposal designed to let parents help pay for private education with public school funds. I'm not sure if this initiative is what he was referring to.

I was told by his PR person that Mr Chambers has done a lot for education around the world. And I applaud his work and the medals and awards his work has earned. However, I'm surprised that he would give up so easily with improving Silicon Valley's local schools.

A "CraigsList" for schools

There are many things that could be done for schools, especially in applying the tools for building social media communities. This is a key emerging business for Cisco it would be a great demonstration of its tools and technologies.

Within walking distance of every local school in the Silicon Valley/Bay Area there is a tremendous amount of resources that could help raise the standard of education for all, regardless of income. This area is the 10th richest economic region in the world.

Why not build a type of "CraigsList" around every school? It would bring the local community closer to its local schools. If a teacher needs a box of pencils or a volunteer to explain rocket science, they could post it online.

This "CraigsList" for schools could also offer a collaborative platform for the teachers, students, and parents. It could offer online tutoring. It could fund free broadband for the schools. If set up as an independent venture, it could possibly fund these activities by offering commercial broadband services to local businesses. It might cost a few bucks more per month but the local businesses would know the money is going back into their communities.

Silicon Valley/Bay Area schools could very easily, and inexpensively become wonderful showcases for the transforming power of the technologies being developed here.

I refuse to believe that our local school system cannot be fixed. And I refuse to believe that John Chambers and our other local captains of industry cannot find a solution to this problem.

We have world class leaders here in the Bay Area, there is nothing that they cannot accomplish.

Where there is a will there is a way, and hopefully my humble post might renew Mr Chambers interest in revisiting this challenge.

Silicon Valley Watcher Challenge: $10K for schools

And in the meantime, I challenge my readers to help raise $10,000 for schools through a challenge on DonorsChoice.org. There are many classroom projects to choose from. This is part of the Lit Liberation challenge established by Tim Ferriss, the author of "The 4-Hour Work Week."

Tim asked Silicon Valley Watcher and a small group of other online publishers to help raise a total of $1m for schools around the world. More details are here, from Brian Solis:

Tim Ferriss Forms LitLiberation to Raise $1 Million in One Month

Take a look at some of the school projects on this page and help schools here and elsewhere:

Help Public School Kids by Funding Silicon Valley Watcher Challenge at DonorsChoose

Technorati Tags: litliberation, puppy

(From my ZDNet column: http://blogs.zdnet.com/Foremski/?p=188)

Sending out friend requests on LinkedIn or FaceBook is fairly easy for Americans but I bet it is less so for other, less gregarious cultures.

For example, I would guess that in Japan there would be fewer "friends" requests coming out of the blue. Same in Europe, especially in the UK, where I'm from.

Here in the US there is a culture of acquaintances which is not as developed as in other countries, or at least the countries I am familiar with. The culture of acquaintances is that I know a lot of people, and I like them, but I don't know them quite as well as my friends.

But that distinction doesn't matter much in the world of the social networks, and in the world of blogging, and Flickr, and Twitter--the whole trend to share oneself with the world...

But what if you are shy, what if you don't want to be AlwaysOn, always in conversation, what if you want to listen to your internal conversation, what if you value your privacy, your personal moments that you share carefully and uniquely? Will those people be at a disadvantage in this new world?

http://blogs.zdnet.com/Foremski/?p=188

The first sign of the dotcom dotbomb was when I saw a billboard with "your ad here." There were gasps in the office when I told my colleagues.

The other day I was at Matt Greeley's Second Friday when I met with an entrepreneur of what Matt calls: "Socially aware clothing."

It's a T-Shirt that text messages, he told me. What do you mean, a T-Shirt that text messages?? I got to talk with the inventor and it is a T-Shirt that has an SMS address printed on it and if you are curious you can send a message to a stranger.

The T-shirts can be used by all sorts of people such as DJs in nightclubs I was told. I asked the inventor if the inks were UV reactive, no, but the rest of the shirt was, because it is cotton and has starch in it...

I generally dress up a bit when going to clubs, doesn't that renegade the T-shirt-with-a-text-message concept to sports bars and frat parties? I was told that in America things are different, people wear T-shirts to clubs all the time. (I don't think so.)

"I only need five percent of the market to be profitable," I was told and I've heard that line before. "Our templates for our T-Shirt designs are copyrighted," when I asked what was the secret sauce.

I said that you could put the same message on a business card, it doesn't have to be a T-shirt. I seems that that idea had already been nabbed by someone else.

Check out Reacted

I want to focus on content and not technology and yet I have been off-line for days because of hardware failures. And trying to learn the new worlds of "many-media"--how different types of media are prepared, produced, and then distributed.

These have been frustrating weeks but I am reassured with a vision of the future. We are almost at that cusp in history when technology will matter less. It'll be what we do that will matter more than how we do things. And then I'll be able to focus on content instead of technology.

A 1-click future

Right now, I am suffering the multiple agonies of dealing with resuscitating two notebooks, a failed external backup drive, and setting up up a completely new notebook--plus learning video and audio editing for Podtech.net related projects.

One of these days very soon, these types of things will be all one-click problems because we'll have pushed so much of our lives into the cloud where such problems are cheaply outsourced.

Standards get wrapped

Much of my week has been spent with either trying to revive my old hardware or getting to grips with new hardware such as Sony hi-defintion video camcorders. The puzzle is that Sony and Panasonic have adopted a high definition video compression format that has no editing support from the major video editing software vendors.

Are Sony and Panasonic so bad at evangelism that they couldn't get support for their video format from dozens of software companies a year before launch? It's been six months since the launch and there is only a trickle of low-end video editing software coming out. Corel's ULead DVD MovieFactory is one of the first to offer some limited support for AVCHD.

Lost in Video Translation

Because of my Podtech.net deal to produce a Silicon Valley Watcher show I've gotten to shoot lots of video but translating and publishing the video content takes hours of computer processing time, and that's without the editing time.

I would like a magic button that automatically takes the video from the camcorder and loads it into my editing software and then when I'm finished, in the time to make one-click it publishes my video interviews all over YouTube, PodTech, AppleTV, iPhone and wherever else. That's a fantasy because right now, just getting the video content out of the camera and into a format for the editing software takes about 7 to 8 hours per hour of footage. And then exporting it into different publishing formats can take another 3 to 4 hours per hour of footage. That's way too much time lost.

Why can't we have inexpensive video co-processors specifically designed to zip through such tasks? A general purpose microprocessor is good at many tasks but not as good as a specialized processor at specific tasks. We already have DSP chip technologies and powerful graphics co-processors that process many similar tasks within PCs. It would be good to get some video co-processors, too. I should thing there must be some on the way...

Over on New Rules Communications I was writing about Google's ad networks and the bad economics for media companies. 

Link to: This Is Why Online Ad Nets Can't Save Media Companies

I noticed that there is an interesting conflict of interest emerging at the heart of Google's business model.

Please check my reasoning:

Google makes almost all of its revenues from two ad networks:

-AdWords: Customers advertise on Google web sites.

-AdSense: Customers advertise on Google partner sites, which includes many media companies.

Google's revenue in 2004 was about evenly split between AdWords and AdSense.

Since then, Google's revenue from its own sites has grown by 24 percent to 62 percent of total revenues. AdSense has fallen.

And this makes sense because Google makes far more money from its own sites than from partner sites. It is better for Google's shareholders that it channel more of its revenues through its own sites because:

-Google gives back about 80 per cent of AdSense revenues to its partners.

-It keeps all of its AdWords money.

And this is where it has a mammoth conflict of interest:

Which advertising network should Google invest in?

-A dollar invested in its AdWords produces far more profit than invested in AdSense, its partner network. Management has a fiduciary duty to its shareholders to maximize profits.

-Google can boost overall profits by undercutting AdSense at anytime it wants, say  by offering a discount on AdWords compared with AdSense. A 20 percent discount on AdWords would make more money for Google than the corresponding loss of business through AdSense partners.

-Google can undercut AdSense in other ways, and is already doing it, by investing in technology that improves AdWords conversions over AdSense. Google can apply technologies to its own sites that make them more efficient at selling ads. It can't do that with partner sites. And partner sites don't have the resources to improve their advertising conversions at a similar pace.

Which means AdSense revenues for media companies will continue to fall because AdWords is more efficient.

---

Media companies that partner with Google in its AdSense program do it because they don't know what else to do. The economics of partnering with Google are poor and the relationship is unsustainable because of the inherent conflict of interest.

Why Would GOOG Maintain AdSense?

-There are strategic purposes, it forces media companies in its network to compete with its far more profitable business model which weakens them as potential competitors.

-Also, it keeps third-party sites out of rival ad networks.

-AdSense is a great "cookie jar" because if GOOG ever needs to meet its numbers for its quarter, it can push more ads through its own sites rather than through partners.

UPDATE: Independent Advertising Network Advantage 

Independent advertising networks, which don't compete with their publisher partners, such as Blue Lithium, Federated Media, and others, will be able to attract partner sites away from Google because they can invest in technologies to improve revenues for the entire network.

But how much freedom do large publishers have in leaving the Google network? Some have contracts with Google that could tie their hands for years.

Last year, in the wake of the LonelyGirl15 mystery, I asked:

LonelyGirl15 was found out to be a fake video blogger--scripted by a Hollywood production team--many millions had watched it, and many thousands tried to find out who was behind it.

What happens in a future world where phishing is applied to news sources rather than spoofing banking sites? And where there aren't enough watchdogs to spot the fakes?

Today's LA Times has a front page story about the "new lonelygirl15."

GreenTeaGirlie innocent vidblogger or sinister marketing hoax - Los Angeles Times

Again, my son Matthew Foremski was involved in this story. But this time in another way, testing the viral nature of trust and mistrust. It's a fascinating account pulled together by Los Angeles Times staff writer David Sarno.

In late March, a striking young brunette going by the nom-de-Tube of 'GreenTeaGirlie' posted a 10-second video on YouTube.
"Hey YouTube viewers!" said the hopeful ingénue, "I'm new. I hope you welcome me. I'm actually going to be making some videos, and I hope they're going to be really neat, so I hope you check 'em out."
Before anyone knew what was going on, "I'm New" had rocketed to the front page of YouTube's daily Most Viewed section, where it raked in more than 170,000 hits on its first day — an extraordinary showing for a maiden video blog.

Again, it is worth asking the question, what happens when there aren't enougth watchdogs to spot fakes and test the veracity of online content?

Will the viral nature of mistrust be our only protection? Or should there be a clear way to test the source of anything published online?  Is it even possible?

I just got back from HP's Gaming Summit at Dogpatch Studios, which showcased some rather nifty gaming technologies from HP Labs (video is coming.)

During a panel discussion, Rahul Sood, chief technology officer at HP Gaming, and founder of Voodoo PC said that next generation PC games based on Microsoft's new DirectX 10 technology will do more to drive sales of Vista than anything else.

"DirectX 10 is going to provide a dramatically improved gaming experience that will drive adoption of Vista," said Mr Sood.

Some of the technologies on display or discussed were:

... a curved, seamless display that fills a gamer's field of view for an incredibly immersive visual experience and a way to superimpose multimedia digital experiences on physical landscapes so people could, for example, play a game throughout a city using wireless handheld devices. The company also demonstrated a "super projector" capable of high resolution, brightness, deep contrast and a wide color gamut, ideal for projecting games for multiple players on a big screen.

Panoply and Pluribus- using multiple projectors to create a seamless giant screen for game playing or other "immersive" applications. It doesn't require precise projector positioning, all the calibration and focusing is by computer.

Memory Spot - This is an intriguing technology, a small coin sized device that can store about 4MB of data and can be read by a computer. That's about all HP was willing to say about this technology, but promised more information and applications later this year.

Coffee Table Display - Imagine a large rectangular coffee table with a huge high definition touchscreen that lets users manipulate images, drag around virtual puzzle pieces, and also transforms into a virtual aquarium! Where do the coffee cups go, I asked Susie Wee, Lab Director of the HP Labs Mobile and Media Systems Lab (video will be posted soon.)

Also:

HP TouchSmart PC
» Fact sheet
» Image

»
HP Labs Gaming Demonstrations

HP Labs researcher Mike Harville tries out a race car video game on a special curved screen designed to increase the realism and immersive experience for gamers.
» Image

Notes: Interestingly, I tried to video a panel discussion between representatives of Intel, HP, NVIDIA, Trion World, and Microsoft but after a few minutes I was told no videos were allowed. I asked why and was told that video camera made some of the panelists uncomfortable, yet they were in front of about 80 journalists(!)

Carnegie Mellon University and the University of California, Berkeley have joined together for a one day conference on April 30th in Mountain View. Academics and industry leaders will discuss issues and trends for "the new software industry."

They promise that there will be no product demos (how about no PowerPoints too...)

"The software industry is consistently in a state of flux, yet developments such as globalization and outsourcing are altering both the tempo and the type of change taking place," said James Morris, dean of Carnegie Mellon West. "We are entering a period of profound change, and we all need to know what's happening and what we can expect going forward. This conference draws on some of the best and brightest minds in academe and the software industry to answer those questions."

Added Jack Grantham, executive director of the Haas School 's Fisher Information Technology Center , "This conference presents a rare opportunity for vendors to check their sales and marketing hats at the door and settle into discussion and debate over the future of the industry with attendees, academics, and other industry thought leaders."

For more information on the conference, visit http://west.cmu.edu/sofcon/5404216.html and at http://west.cmu.edu/west_connect/events_news/news/6731936.html.

 

It seems clear to me where the software industry is headed:

•  it is about software as a service.
•  it is about moving away from running apps on your own hardware.
• it is about roll your own apps.
• it is about offshoring as much development as you can get away with.
• it is about integrating as much open source software as you can.
• it is about moving away from a database model of software towards a search-based apps type of approach.
• it is about creating apps for the small and medium business sector.

To register for the "The New Software Industry: Forces at Play, Business in Motion," go to http://www.acteva.com/booking.cfm?bevaid=128819. The early registration fee of $395 is available until Friday, April 6, 2007.

Warsaw University's team  won the 31st annual World Finals of the ACM International Collegiate Programming Contest, sponsored by IBM and held at IBM Tokyo Research Lab.

There were 6,099 teams on 6 continents in regional contests and 88 teams qualified for the finals. 25 teams were from North America, 2 from Africa/Middle East, 10 from Latin America, 20 from Europe and Russia, 31 from Asia/South Pacific.

Warsaw University solved 8 problem sets, in second place was Tsinghua University with 7 solved, the rest solved 6 or less. Highest scoring US team was MIT in fourth place behind St. Petersburg University.

Warsaw won the 2003 championship.

Polish programmers have won many international programming contests, reflecting the country's strong history in math and cryptography. Poland is becoming a favored site for many US company development centers.

Contest Standings - The 2007 ACM-ICPC World Finals

The Problem Sets

Link to ACM Contest

Technorati tags: warsaw university, ACM-ICPC

Andy Plesser over at Beet.TV has an interesting interview with Alex Laats from Defense contractor BBN about using advanced technologies to analyze and transcribe YouTube videos with 80 per cent accuracy.

A major defense department contractor, BBN of Cambridge, Massachusetts, has applied a national security technology application, developed to fight terrorism, to "crawl" the audio tracks of public Internet videos through its Podzinger subsidiary. 

Podzinger has analyzed, transcribed and organized some 1.5 million YouTube clips since December and is crawling many thousand every day, according to Alex Laats, who heads the unit.

It is interesting that government agencies have this technology and it means that Big Brother is here and now, so let's get used to it.

I love all the widgets that are coming out. There are some excellent services that offer search, headlines, and many other services.

Web site owners can customize these widgets and drop the Javascript code onto their servers. When a visitor comes to their site, part of the page occupied by the widget loads data, text, or images. You can see a widget in action in my side column showing recent visitors and their photos.

Widgets can be tiny, for example, at the end of my posts you can see how many blog responses Technorati has found to each article. And it is easy to make them yourself, I'll probably put together an SVW headlines widget that other sites can use.

But I wonder about the extra load on servers and bandwidth around the Internet as thousands of new types of widgets offer various services, and are deployed on tens of millions of web pages. Each time a widget containing page is viewed in a web browser, it collects data to display in that page.

So, in the above example, Technorati initiates a search for related blog posts whether it was requested or not. This creates a load on Technorati servers which slows down the user experience for anyone initiating a manual search. And it also taxes data bandwidth to move data that wasn't directly requested.

This could add up to a "load" tax on the overall Internet as widget mania proliferates.

I was discussing widgets with Josh Hallett at the Newcomm Forum. Josh is an excellent example of what I call a "media engineer," he has built web sites for many large media companies, such as the New York Times, using publishing platforms such as Movable Type and Wordpress.

Josh pointed out that using a lot of widgets can compromise the performance of your web pages. "You are at the mercy of the widget publisher. If they are having a bad day and their server is down, your page won't load in the right way."

Josh also noted that the widget publisher gets a lot of useful data from each web page it is on. Granted, not every widget publisher is going to be mining that data but it is there nonetheless. That means the widget publisher could collect a lot of information on readers, IP addresses, etc.

BTW, this is exactly why I was against running advertising networks on my site when I first started publishing because of this spyware issue. The advertising networks such as Google AdSense don't pay much AND they collect a lot of data on my users.

Google (and other ad networks) can triangulate data from many sources and collect an amazing amount of information on users as they move from site to site and as each web page load triggers another data stream. The same is true for the widget publishers.

[Doesn't this mean that Google should be able to figure out who is running a spam site and who is committing click fraud to a fairly high degree...? Maybe Google's figures on click fraud are fairly accurate.]

...

Here is Josh's excellent blog Hyku.

I was discussing innovation Wednesday evening with my old buddy Tom Abate from The SF Chronicle. These chats always provide lots of fodder for posts.

And in talking about innovation I began to wonder if it was synonymous with disruption. I think it is, because if innovation is not disruptive it won't get funding, at least not here in Silicon Valley.

Is there a unit of disruption? I'll propose one: a $1Billion unit of disruption reached over 5 years (BUD).

1 BUD = A business process that has the potential to generate $1bn in annual sales within five years.

That's about the minimum upside that a Silicon Valley startup needs to show in order to get funding. More is better, a five BUD would be stellar.

And 1 BUD = 1 Innovation Unit. Because Innovation has to be disruptive, imho.

Tom Abate: MiniMediaGuy

About 15 miles south of San Jose, down a country lane, and hidden behind one of the scenic rolling hills of "Steinbeck country" is IBM's Silicon Valley research and development labs.

It used to be called Santa Teresa Labs, opened in 1977 with about 3,000 square feet, housing about 1300 researchers, mostly working on software projects.

It is miles from Silicon Valley and out in the middle of nowhere, but this is one of IBM's top research labs. Clearly, IBM renamed the labs because it wanted it to be associated closely with Silicon Valley, and with innovation - the life blood of Silicon Valley.

I was there recently for an event that showcased some of IBM's customers (EBay, Yahoo)  and IBM's technologies. I heard a lot about innovation. Innovation was by far the most commonly used term by the presenters. I also heard a lot about IBM's "Innovation Jam."

This is an event that takes place once a year and was started in 2001, bringing together tens of thousands of IBM people, and customers, in a three-day brainstorming festival.

I had two questions: The first was "what is innovation?"

I was told that it means bringing people together to create new ways of thinking and of doing things. I was told that Innovation Jam created a whole pipeline of projects and that some of those became significant businesses, etc.

But what I really heard between the lines, was that IBM was using collaborative technologies to create business ideas and that it was the collaborative technologies of blogs and wikis and online forums that were the real innovation technologies.

My second question was: "Why does innovation only happen once per year at IBM?"

I was told that the Innovation Jam happened once per year but that the threads started there would continue throughout the year and that it took time to weed out the great ideas. Once the best ideas were discovered and tagged they would be placed into IBM's "Innovation Factory" where people would figure out how to monetise them for IBM's clients.

It was an interesting afternoon and it made me realize how much thirst there is for "innovation" among companies, and how IBM is hoping to monetise that thirst by getting companies to outsource their innovation needs to Big Blue.

I guess if IBM can say "innovation" enough times, and append "innovation" to as many things as possible, it has a good chance to make lots of money. After all, it runs the largest computer R&D labs in the world, and those researchers need to get paid. If IBM can provide "innovation" to others, then that is a good thing for all.

But the term innovation is getting so very broadly defined that I fear it is becoming over used and doesn't have much meaning.

One of the IBM executives told me that increasingly, a lot of large companies have been appointing executives with "innovation" in their titles. Such as a VP of innovation, or a chief innovation officer, and it is not clear what those jobs mean.

A little while ago I got into an online debate with Geoffrey Moore, Silicon Valley's top IT and business consultant,  on this subject of innovation. He had put together a list of different types of innovation and had said that innovation does not have to be disruptive.

I respectfully disagreed, I said innovation had to be disruptive, anything less was just an incremental improvement on how things are done. Without disruptive innovation most of the companies in SIlicon Valley would not exist, would never get funding. Who would fund a company that had a technology that just improved on an existing process?

Innovation dramatically improves a process or creates something that is capable of wresting away a huge chunk of market, valued in the $1bn plus range. Anything less is not innovation and is not disruptive.

But I shouldn't throw too many stones because I do live in a glass house. I publish "Silicon Valley Watcher - Reporting on the business and culture of innovation."

But maybe I should change my tagline to this: "Silicon Valley Watcher -Reporting on the business and culture of disruption." That way I can continue throwing stones...

- - -

Additional Info:

Geoffrey Moore: Disrupting myths of disruptive innovation

By Tom Foremski for SiliconValleyWatcher.

Geoffrey Moore, one of Silicon Valley's top IT consultants has published a column disrupting the notion of ...
www.SiliconValleyWatcher.com/mt/archives/2006/02/geoffrey_moore.php - 47k -

Dealing_with_Darwin: What do we mean by Innovate?

This blog entry is in reply to Tom Foremski's challenge to one of the points ... Geoffrey Moore’s blogging dialogue with Tom Foremski highlighted to me my ...
geoffmoore.blogs.com/my_weblog/2006/02/what_do_we_mean.html - 25k -

Andrew Nordley

The Harvard Business Review has a list of top 20 "Breakthrough Ideas for 2007." Some interesting, ideas here that are counter-culture in that they challenge accepted thinking in many different areas. Siobhan Ford from HBR says that the list is free to read for all of February and that the most popular ones so far are:

• The Accidental Influentials—Forget the Tipping Point. New research shows that ordinary people, not influentials, are the best word-of-mouth marketers.
• Living with Continuous Partial Attention—The increased “coping mechanism” we’ve adapted to keep up with information flying across our radar 24/7, thanks to the endless bandwidth of technology. Can a backlash be far off?
• An Emerging Hotbed of User-Centered Innovation—Customers aren’t just voicing their needs to companies that are willing to listen; they’re inventing and often building what they want.
• The Folly of Accountabilism—Accountability has gone horribly wrong, tricking people to believe they can control their lives by adhering to specific rules of right and wrong.
• The HBR List Breakthrough Ideas for 2007

I also found #2, #9, #10, #11 and #14 fascinating.

Here is the list with links to the individual articles.

From the UK newspaper The Guardian: (Hat tip to Phil Manchester) 

Sir Tim Berners-Lee, the Briton who founded the Web in the early 1990s, says that if the internet is left to develop unchecked, "bad phenomena" will erode its usefulness.

His creation has transformed the way millions of people work, do business, and entertain themselves.

But he warns that "there is a great danger that it becomes a place where untruths start to spread more than truths or it becomes a place which becomes increasingly unfair in some way." He singles out the rise of blogging as one of the most difficult areas for the continuing development of the web, because of the risks associated with inaccurate, defamatory and uncheckable information.

Sir Tim believes devotees of blogging sites take too much information on trust: "The blogging world works by people reading blogs and linking to them. You're taking suggestions of what you read from people you trust. That, if you like, is a very simple system, but in fact the technology must help us express much more complicated feelings about who we'll trust with what." The next generation of the Internet needs to be able to reassure users that they can establish the original source of the information they digest.

Creator of web warns of fraudsters and cheats The Guardian Guardian Unlimited

Sir Tim is right, but it is a problem that is not confined to blogging; it is a problem that affects the entire Web. This is why we need a "trust trackback" or a TrustBack.

In the same way that a trackback lists who has linked to a specific online article, a TrustBack would verify the original source of online information, such as a press release or news story, and show that it is not from a "phishing" site.

On September 17, 2006, I published this post on the lessons from the LonelyGirl15 saga.

We badly need a way to verify sources of online content - we need a "trust trackback"

To save you a click or two, here is an excerpt:

What happens in a future world where phishing is applied to news sources rather than spoofing banking sites? And where there aren't enough watchdogs to spot the fakes?

A little while ago, Google News was carrying a hacked headline that was anti-US and anti-Israel. That was easy to spot; but what if Google News, or some other large news aggregator, were carrying a Reuters story that might have been more subtlety altered? . . .

 

. . .This ability to know that a news source - an individual, a company, an organization, a community, or a government - really said what it is said to have said in a news story, an online post, email, or any other distribution channel, is incredibly important. Otherwise there will be others who will sow misinformation in very sophisticated ways, for commercial gain.

There will be many opportunities for such misinformation in the online world. With so many sources of information, and more coming our way, there won't be enough online sleuths to flag the fakesters as there were with LonelyGirl15.

This means we need to have a way to verify the source of specific chunks of content as originating from an individual, a company, an organization, a community, a government.

A reader should be able to click a "trust" button and have the content verified. . .

. . . For this next phase of the Internet, we badly need a mechanism to verify the source of information that we read online.

This is about creating a type of "trust trackback" that is part of the secure core infrastructure of the internet. Who is up to this task?

Sir Tim? Can you fix the Internet for us?!

LonelyGirl15 was found out to be a fake video blogger--scripted by a Hollywood production team--many millions had watched it, and many thousands tried to find out who was behind it.

What happens in a future world where phishing is applied to news sources rather than spoofing banking sites? And where there aren't enough watchdogs to spot the fakes?

A little while ago, Google News was carrying a hacked headline that was anti-US and anti-Israel. That was easy to spot; but what if Google News, or some other large news aggregator, were carrying a Reuters story that might have been more subtlety altered?

Google News, does not use humans to spot problems, it compiles the news stories using algorithms. But can those algorithms spot fakes? Clearly not in this case.

In the future, or even now, how can we know if a Microsoft press release really came from Microsoft? And the same goes for nearly every other piece of information we find on the internet. Tampered news stories might not be noticed for days or weeks.

Validating trusted sources of information is going to be very important. And part of that trust will be provided by going to web sites of long established media brands such as the New York Times, and through anti-phishing technologies such as OpenDNS, to make sure your browser is reading a valid site.

This ability to know that a news source --an individual, a company, an organisation, a community, or a government-- really said what it is said to have said in a news story, an online post, email, or any other distribution channel, is incredibly important. Otherwise there will be others who will sow misinformation in very sophisticated ways, for commercial gain.

There will be many opportunities for such misinformation in the online world. With so many sources of information, and more coming our way, there won't be enough online sleuths to flag the fakesters as there were with LonelyGirl15.

This means we need to have a way to verify the source of specific chunks of content as originating from an individual, a company, an organisation, a community, a government.

A reader should be able to click a "trust" button and have the content verified.

For example, in reading a news story: it consists of content from the journalist/news organization; there is content from the company (the ceo said..., our customers said..., the analyst said....,); and there is information from other sources, (the company stock price..., related announcements from other companies..., related stories..., etc). An online reader has to have the means of validating each of those sources of information.

This issue of sourcing also applies to the new media release project I've been working on with corporations and PR agencies. The new media release project is focused on ways of releasing company information onto the internet in many forms, such as vidcasts, podcasts, text press releases, etc.

Those companies/organisations have a duty to release their information in such a way that its origin can be verified, and that others cannot change the content surreptitiously.

For this next phase of the Internet, we badly need a mechanism to verify the source of information that we read online.

This is about creating a type of "trust trackback" that is part of the secure core infrastructure of the internet. Who is up to this task?

- - -

Coming up:

A report on my Sunday meeting with a delegation of Spanish technologists from the remote region of Asturias in northern Spain. This is a fascinating group of researchers, academics and business representatives, that are thinking in terms of community rather than technology. They are in town visiting with Silicon Valley's leading companies and research organisations.

My good buddy Om Malik has launched a new blog called WebWorkerDaily to chronicle the virtual nature of work and its always-on effect:

Connectivity is only part of the equation, for the virtual nature of work brings up lifestyle issues. It brings up questions about how to work, and when not to work.

Link to Introducing WebWorkerDaily.

Om cites a post called "Going Bedouin" by Greg Olsen in February 2006.

By focusing almost exclusively on service-based infrastructure options, a business could operate as a sort of neo-Bedouin clan - with workers as a roaming nomadic tribe carrying laptops & cell phones and able to set up shop wherever there is an Internet connection, chairs, tables, and sources of caffeine. "Going Bedouin" is an interesting concept . . .

This is an interesting concept and something I explored in an essay in October of 2005. I chose the word "nomadig" to describe the lifestyle made possible by our mobile technologies:

We seem to be going back to our roots and becoming nomadic peoples again--or rather "nomadig" people: living in digitally-enabled groups but not necessarily *technology* focused ...

And this time around, we are no longer tied to a particular geography, and nor is our thinking. Much of the culture of innovation is no longer tied to Silicon Valley, there are centers of innovation all over the planet.

We are mobile and seemingly in constant motion, travelling thousands of miles in a day, in a week, in a month, yet we remain rooted within our online worlds as if we hadn't budged an inch. Our physical address changes more often than our online address.

And our digital technology is disappearing into our surroundings, becoming embedded and almost invisible; as the word "digital" is embedded and almost invisible in the word "nomadig."

The essay is here.

Nomadig is the basis for SVW's future arts and culture magazine that we spoke about late last year, and mentioned in early August.

It was to be called diggrz but that name will probably be changed to avoid association with Digg - the news aggregator. I wanted to make the connection with the Diggers, the 17th century English revolutionary group that advocated a defense of the commons, and despised wealth and privilege; sentiments often expressed in today's software engineer culture.

By Tom Foremski for Silicon Valley Watcher

In thinking about Google handing over identifiable information about users of its Orkut service to Brazilian authorities, and disclosures by Yahoo in China, couldn't such things be avoided fairly easily?

For example, Enron set up huge numbers of off-shore companies to hide its debt and obscure its financial reports. Why couldn't such a method be used by Google, for example, to hide and obscure its data collections? 

Those offshore companies could be made responsible for administration of parts of its services. They could pass back data to GOOG but that data would be only data that was needed for specific tasks.

If there were hundreds of such off-shore companies, maybe independent, handling various aspects of GOOG's services around the world, it would be very difficult for anyone to access, or force access, to personal data on many millions of users.

Contractual agreements between GOOG and the off-shore companies could further prohibit disclosure of personal information to GOOG and others.

Authorities in any country would be hard pressed to chase down or subpoena private data from large numbers of off-shore companies if the data were to be fragmented in this way. It is easy targeting just one big player.

Maybe there is an opportunity for the off-shore financial centers around the world to move into this kind of business?  After all, places such as Bermuda, Switzerland, etc, have strong laws protecting the identity of bank customers. It would be a small shift in the law to protect the identities of Internet users.

The Internet giants could still have their behavioral data on users but it would first be collected and  laundered by the offshore companies to remove identifiable information. There would be nothing to hand over if authorities were to pressure Google, Yahoo,  YouTube or any other web services provider.

Please also see:

DARPA TinyOS developers get $5m from Intel and others

By Tom Foremski for SiliconValleyWatcher Who says Big Brother/Sister isn't coming? It is but under a different guise...

Posted in Silicon Valley Watcher--on March 27, 2006 05:25 AM

Big Brother brings business opportunities

With all the chatter about Big Brother, and government subpoenas for internet usage data, there are business opportunities to be had...

UPDATE: A reader points out that it looks like the Irish Medical Times newspaper was hacked and then picked up by Google. I had posted this hack from Google News with an anti-Israeli message and I asked how GOOG could stop other such incidents and guarantee the integrity of the content.

Google News is one of the world's most popular web sites and a trusted brand. This means it has a responsibility to its community if it is to retain the trusted brand relationship--which Google has managed to maintain despite its super-star status.

http://72.14.203.104/search?q=cache:rX8_ZjbMpf4J:www.imt.ie/displayinterview.asp%3FWID%3D250%26CAT%3D19

Since Google does not employ any human editors, (it is all harvested by machines) the hack hasn't been filtered from Google News.

This calls for a Digg-type credibility system. GOOG can still use machines to harvest content, (more scalable than humans) and the readers can flag potential news hacks. The entire community benefits.

But that's if the community can detect false or doctored stories. A slight doctoring of a company earnings announcement could translate into market advantages for some, and could be difficult to spot in a timely manner by even the most vigilante citizen press corp.

Citizen journalists will be very important unless we figure out viable business models for the profession of journalism; they will be the public's prime media sources, but with the potential for misinformation too.

Private groups will increasingly finance professional journalists and collect and share the information in select groups to gain competitive advantages. Ted Shelton points out that this is the way the Venetian princes won at overseas trade.

Information about ships and prices of goods was valuable to those that had it. It was so valuable, that the Venetians managed to beat out competing trade centers--and also fund the Renaissance.

This transformed the entire known world. The Renaissance was a cultural and scientific revelation, it was the rediscovery of rationalism. This propelled humanity out of a millennium of Dark Ages and into the Age of Enlightenment, and led to our modern world. Not too shabby.

I know that there will be a new generation of Venetian princes from this next phase of the Internet. If it also brings a cultural revolution on a Renaissance scale, that would be interesting. I would certainly welcome a rediscovery of rationalism and the secular society.

Anybody who runs a blog or a web site usually peeks at the search terms that visitors input. It's fascinating stuff because sometimes you can find clues to breaking stories or emerging issues/trends.

And looking at the AOL search term database that was recently released, you can see how people use the search box to make statements, as much as ask questions. The AOL search information is fascinating reading because it represents unguarded thoughts and feelings that could not be collected in any other way.

However, I find it hard to belive that AOL believed it was innocently providing the world with behavioral data and protecting users from being identified. Yes, AOL assigned a numeric code to each user accounts search history, rather than user names. But there is plenty of information in the search terms to identify some of the users.

Now, people will be far more guarded in their use of online services. Surely AOL knew that the data could identify some users. Anybody, even the newest of newbies could look at the search data and see how it could be used to identify people. Yet AOL went ahead and released the information.

Maybe some at AOL wanted to warn others that even if a company says it is not collecting identifiable data on its users, it is not true. People ego surf, they Google their dates, they check up on colleagues and ex-lovers online, they search on phone numbers, etc.

The AOL incident has placed Internet users on notice that their lives are transparent, even in unguarded moments, even when searching for something, anything, even when companies say they are not collecting identifiable data.

One response is to be very careful what you search for. Another response is to poison the database, to create a smokescreen, to use aliases/avatars, to make sure that the data collected online contains only a sliver of the real person.

Yes, it is more work, but you can never know how such information could be used in the future. You can never know if the political climate changes, and some people become persecuted for their past search terms.

And this data never goes away. Google, for example, keeps every search term, keeps a copy of every web site it ever indexed--it never throws away a single byte of data it encounters. And others are doing the same thing, and others have to comply with government regulations in keeping data for many years.

Your every click and keystroke online is being collected by many different organisations, and that means that at some point it will be possible to track it all, and identify most of it. Welcome to the future transparency of your life.

Is this what the loss of net neutrality will bring?

An SVW reader left this tip:

I use Cox cable internet, Cox's media empire printed classifieds is one of their big revenue drivers. Guess what? If you try to access Craigslist over Cox Cable internet... its nearly impossible! It appears that they throttle access to craigslist - as a matter of fact there have been a zillion complaints but hey, who can blame Cox? They're trying to stop the opening cap in their money dam! Maybe you should investigate this tip further. Cheers

I did investigate further, I walked out of my apartment and across Alamo Square and popped in on Jim Buckmaster, the CEO of Craigslist. Jim was just getting back from work and I spoke with Susan Best, publicist for Craigslist. Susan said they have known about the problem with Cox.