Category Archives: Business

Review: Dealers of Lightning Story of Xerox PARC

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This is the Third historical book written about a business. The first was the history of Bell Labs and compared to that book, this was a wild ride in terms of organization. It would bounce back and forth over the span of ten years, while Idea Factory (Bell Labs book) was a stately possession moving forward with time. I believe that the major difference was that while a lot was happening at Bell Labs, it wasn’t crammed into 10 years. It occurred over 40 years or more, which allowed the author to pick and choose the people to follow. In Dealers of Lightning so much was happening at the same time with the same people and unique people that it forced the author to jump backwards and forwards through time.

Despite that, it really made me realize how much we owe to PARC researchers in the 70’s for technology we have today. If you’re using a tablet, one of the very first visionaries that created that concept was Alan Kay, he first envisioned it in the 60’s and from what was described in the book, the iPad is pretty much true to his vision. Amazing to be honest.

Here’s a list of things they made:
Object Oriented Programming
Ethernet
The First mass produced PC
The predecessor to Word
The original Desktop
VLSI, what has enabled the development of basically every semiconductor chip
The first Graphics Chip
Copy, Cut, and Paste
The right click
First Laser Printer
The predecessor to Postscript (Adobe)
A piece of software where you could edit text and pictures at the same time
A computer in 1982 that had 6000 Japanese characters and could type in 100+ languages and it’s capabilities wouldn’t be match again until the 90’s

Dramatically influenced Apple, Microsoft, 3Com (Metcalfe founded this after leaving PARC), Adobe (2 PARC researchers founded this), and many other companies.

Xerox was a visionary company to fund a research agency like PARC. PARC was likely one of the last of its kind as well. There are very few companies that have a similar branch of research facilities that push basic and applied scientific research. I suggest reading this book, just so it helps you understand where the technology we all use and love came from.

I give this book 4/5. Well researched, great topic, difficult to write because of the concurrent activities.

New economy vs. old economy

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With the rise of the so-called “Sharing Culture” there’s been a recent upswing in the types of business that focus on connecting people point to point with others that can provide services that people need without a lot of the fuss of other intermediaries. There are, of course, a few pioneers in this type of activity, Napster, Kazaa, but also more “Legitimate” companies, such as eBay, PayPal, and Craigslist. These caused disruption, but not on a seriously massive level. eBay expanded the amount of people that could or would auction off their goods. It more likely impacted the amount of garage sales or donations to Goodwill. Craigslist did have a negative impact on newspaper’s income – however newspapers were having other issues because people just weren’t buying them, so it was somewhat moot. Now, however, there are companies springing up that are impacting much larger less “fringe” portions of our economy.

I first heard of companies like this while in the Netherlands where some of my friends were using Couchsurfing. Which connected people that were passing through an area for a night to two to crash on someone’s couch. I don’t think any money was exchanging hands. I believe that this site was a natural precursor for AirBnB, which has gotten in a lot of hot water lately. This site, for those unaware, allows people to rent out rooms of their house or their entire house for short periods of time. The idea is that the renters can use the stuff in the house and have a cheaper place to stay compared to a hotel. While the owners are able to rent out unused space. For instance, I could rent out my third bedroom if I wanted too.

A lot of people aren’t happy with this notion. For one, it does violate a lot of zoning laws and people are pissed about their neighbors renting out rooms to god knows who. Secondly, it does violate those laws and New York City has decided to do something about that. They’ve asked for information on 15k users in the city. This will likely be a large blow to membership there. If users feel that they are likely to be hit by a law suit or forced to pay licenses to rent out the rooms, renting the rooms will be much less appealing. This of course will thrill hotels as they can continue to enjoy a higher cost.

Part of this stems from the fact that this is new and scary. People don’t understand the change. Part of it comes from the fact that the city doesn’t want people to do this instead of normal rental agreements which “protect” both parties in different ways. An AirBnB arrangement is very different and likely has a lower level of protection (mostly social norm based rather than legal based). Part of it probably has to do with money. The city likely earns less taxes from people renting rooms this way than from Hotels.

These types of differences are going to be occurring on a more frequent basis. We need to help steer the conversation as internet savvy folks and look into how we can create accommodations for both sides. I’m not saying for the hotels, I’m talking about for your neighbors and community. Work with them to help them explain what’s happening, why it’s happening, and what they can do to help develop the social norms for websites like AirBnB rather than destroying it before it has a chance to be successful.

I’m hoping there will be a lot more experimentation in these types of sites even if I never use them. I firmly believe that it’s your house you should be able to use it as you see fit as long as it doesn’t cause harm to other people. Having a two way conversation and educating the different stakeholders involved is crucial to ensuring the survival and continued experimentation in these spaces.

Review of Without Their Permission

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I was inspired to begin writing again by reading Alexis Ohanian of reddit fame’s debut book, titled “Without Their Permission” for those that were regular readers and know me are aware of my interest in the startup community, technology, and activism during the SOPA/PIPA days. So reading this book happily fell into many of those interests.

First of all, this book was entertaining. It’s a rather self aware book and in some cases the humor of it reminded me of Drew Curtis’s book “It’s not News it’s Fark” which is a humorous book that really pokes fun at mainstream media. There’s some of that in this book, but it’s much more playful and selfaware of how important the media has been to Alexis’s success.

During my Master’s thesis research I read a lot of scientific studies that looked at the types of businesses, industries, education, and so forth of founders. Which really focused on the technical skills of the founders. This book didn’t. Alexis wasn’t the technical brains behind reddit, he was the “other stuff” that helped make reddit reddit. I believe that this is a fantastic view point to bring to the conversation on start ups, incubators, accelerators, etc… because it’s something that’s missing.

I have to say at first while reading the book I was really annoyed by the line “every link is created equal” because in any network this simply isn’t try. Any unconnected link is equal, but as soon as the Internet is the Internet links become less equal because of interconnectedness of the Internet. At first this prevented me from enjoying the book because I was so focused on this, however after working 8 hours I forgot about it until it was mentioned later. I only bring this up, because a large portion of the book is spent discussing how important networking is to the success of a startup. It became clear to me that Alexis gets it.

I also found this book enjoyable because it is much less self congratulatory about the Internet entrpreneurs than other books such as Makers, the New industrial revolution, Micro Wikinomics and Macro Wikinomics which cover very similar topics and ideas. In fact any time it felt to be getting too overly optimistic Alexis would point out that everything comes from hard work. It’s work that almost everyone can do, but it takes dedication.

Alexis points out a lot of successes that he’s been involved with as an investor, which provide a lot of great anecdotal experience as well as a graduate’s perspective from the Y-Combinator. I think these views are all helpful as we begin to look for more unique ways to fund startups beyond the traditional VC method.

Finally, I enjoyed the section about SOPA/PIPA which was interesting as I was actively involved on reddit and blogging to inform others about what was happening. Some of that included sharing the interviews Alexis did during that time period.

In general this book is definitely a great introduction to a more realistic view of Internet entrepreneurship from a successful founder, a great introduction to many unique startups out there that are very inclusive, and a great introduction to SOPA/PIPA for people that weren’t paying attention.

Get out there and make something great happen.
5/5

NSA and Edward Snowden

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Today saw the unveiling of the NSA leaker, Edward Snowden, a highschool dropout that worked his way through sheer capabilities as a programmer. To me this guy is pretty amazing. He cares about the people that he could have put in harms way, he made sure that he did not release any information that would put anyone in harms way, even though he had the capabilities. He learned from Bradley Manning and worked to ensure there would be no risks of physical injury. He felt that these actions violated the constitution and decided to expose these deeds to the public even though he knew his life was over. He believes he’s likely to be targeted by the US government or an agent, such as a member of the Triad gang (he’s in Hong Kong), to be executed.

Not only he is clearly concerned, but the media seems to think that this is also true. My roommate was watching ABC news with Diane Sawyer and during one segue she mentioned that he may have left because he feared for his life and was likely in danger. Think about it. It’s publicly acknowledged by our press, that it’s likely a whistleblower might be killed by the US government. This is a US citizen that has a family history of serving (father a member of the coast guard and mother a legal clerk) the US government. He is afraid for his life because he believes that the US government would murder him. If he dies and his body is found the blame will automatically fall upon the government. Edward will not be able to answer phone calls, call anyone, and is essentially on his own to make it to a country that has no extradition treaty with the US. This is a travesty – the fact that many people believe this man is going to die within the next few weeks – killed by his own government without his right to a trial.

Why does what he said matter? A lot of people are talking about it being only Metadata – here’s an excellent article explaining what would have happened if the British had meta data during the revolutionary war. It would have ID’d Paul Revere as a likely revolutionary based on his association. Knowing nothing else about him other than a few clubs he and 254 other people in Boston were members of it was possible to deduce the entire social network and who was at the center of the networks.

As I mentioned in my last blog post this network analysis would have caused the changes in my Facebook network to raise some red flags. I suddenly move to Europe (I didn’t list Eindhoven has my city of residence it would have been inferred from my friends), some of my first connects in Europe on Facebook were 2 Colombians, 2 Pakistanis, an Iranian, and a Turk. These changes represented a major shift in my circle of friends. I had few non-americans as friends and no Iranians or Pakistanis in my network. Using the full history of my data they wouldn’t have found much except that I liked to drink and wrote drunk posts on Facebook while in college. However, it’s likely I would have remained someone to keep an eye on, and since then I’ve written numerous posts about Anonymous, LulzSec and other controversial topics.

Anyway, it’s important to keep this in mind when selecting the companies you decide to store your information with, even if it’s “only” metadata. Where you go, who you talk to, and what you do online are all representations of you and a lot of information can be gleaned from that.

What can we do? Vote all the bums out of office next go around for one. Start companies that only hand over encrypted data that the end users are the only ones that can decrypt it. Educate your friends, family, co-workers, and anyone politically minded you know. We need to drive change otherwise this will continue and will only get worse. At what point do we need to start worrying that the NSA/US Government will start killing your friends because of who they talk to and what they believe?

Looming battle: Content providers vs. service providers

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In my last post about the PS4, I discussed how the PS4 is a long term play and that over time the product will move away from playing directly on the PS4 towards utilizing servers to stream the game to the user. This was an argument to counter many PC gamer’s disdain for the specs for the system. Sure, the specs aren’t great, but they are a huge advancement over the PS3, which is still able to play, rather well, new games.

Most of the feedback I got on the article basically went “well that’s great and all, but the infrastructure isn’t there for this in the US.” This is extremely valid feedback. AOL still records $500 Million in revenue from dial up connections. The US rates among the worst in developed world for internet speeds and penetration. Of course there’s the argument that our country is so much larger, well, the EU as a whole tops us, it’s not uniform across the EU, but that still makes it a valid comparison. The other thing to remember, the console won’t just come out in the US. Many of these features will work better in Korea and Japan than in the US. Typically Sony has released different features by region and will likely experiment with the sharing features in Japan before rolling it out to the US, where Sony knows it will have infrastructure difficulties.

This discussion raises additional concerns though, infrastructure isn’t just about the lines in the ground, but also the structure of the service providers that allow access. In the case of the US, not only does quality and speed of the connection vary wildly but we also have more restrictions on the amount of data we can download than other countries. For a typical family you end up buying the internet 2 or 3 times at the minimum (smart phone access per family member and then the main house connection). Each of these connections likely has a different maximum for downloading or uploading with fees for going over this.

This creates a lot of difficulties as we don’t always know how much bits a specific file will use as we access it. In many cases, it likely drives consistent under utilization of the service do to excessive fees and user dissatisfaction for those hitting the cap. Americans are starting to cut the cord in record numbers, my wife and I don’t have TV, just cable internet; I have a lot of options without Cable. This is going to start increasing the rate of frustration users have with caps. I typically watch live streaming video in 720p while my wife surfs the net and watches a show on Hulu.

I have absolutely no idea how much bandwidth is being consumed on a typical night. There is no easy way for me to measure this or plan for getting close to a cap. Furthermore, both my wife and I use our phones to access the internet, listen to music, watch videos, and play games on our phones. Again, all of these use bandwidth and likely push us against our cellular plan. Sure there’s meters for these, but they are notoriously inaccurate.

This issue with be further exacerbated by the proliferation of cloud services like Drop Box, video sharing on YouTube, streaming new services all the time, and the eventual goal of offloading computing power to the cloud. The measurement of these services will be extremely difficult and planning for how much data these services will require will be absurdly difficult at best for the average user. It is likely that these services will push users over the usage caps on a monthly bases.

I think that we need to start looking for another solution. I think that Google Fiber is a start, it would make sense for Netflix, Amazon, Dishnetwork, Microsoft, Intel, and other content providers to join a consortium that will introduce a new service provider to attack the incumbents. I have heard that Dish is currently working on creating their own system with Google or some other company, I think that this could potentially shake up the industry and allow users more options. There are going to be a wealth of new services that require more and more bandwidth and higher speeds. If these content providers want users to be able to access and enjoy their services they need to challenge the status quo to enable their customers.