Bitcoin is a peer-to-peer virtual currency that seems to pop up in the conversation everywhere I look. A virtual currency is is a currency that is created on computers and traded on the internet. A couple of examples of virtual currencies are Linden Dollars in the online world Second Life and Gold in the massive multiplayer online game World of Warcraft (WOW). People in third world countries play WOW to collect WOW Gold and sell it for real money to players in the first world so that they can buy more powerful armor, weapons and spells to use in the game. Bitcoin is different in that its purpose is to be a currency like dollars, euros or pounds, whereas Linden Dollars and WOW Gold are an element of their games and have no real purpose or value outside of the game.
The other aspect of Bitcoin is that it is a peer-to-peer currency. Bitcoin is created by mining for it against a cryptographic algorithm. Once Bitcoins are created they are traded on a peer-to-peer network. When a transaction has taken place, it is broadcast to the peers on the network, they confirm that the transaction is valid and has taken place. The peer computers add the transaction to the history so that the transaction becomes permanent. There is no central authority that creates or manages Bitcoin, it manages itself through its network of peer computers all running the same software.
One feature of Bitcoin that has excited interest is that it promises secure anonymous transactions, like cash, but over the internet. While this may seem like a good thing, it is also a problem as it means that Bitcoin is an extremely useful currency for people who want to get around the law. Bitcoin has the problem that it needs to establish itself as useful currency with a legitimate reason to be. If the major use of Bitcoin turns out to be to abet criminal activity it may find itself under attack from governments that want to suppress it.
I am going to do a couple of posts on Bitcoin, one examining the economic aspects, and the other looking the technical and security aspects. In the mean time here are a number of links on related issues. My interest in a virtual currency comes from several direction. In the past I have written in this blog about both Virtual Goods and Virtual Economies.
A big question at the moment is the whole issue of what is Money. Some politicians, concerned about monetary policy have called for a return to the Gold standard, which has resulted in others asking this question. This American Life did a Podcast on that subject and came to the conclusion that Money is much more ephemeral than we may think. Planet Money did a related story where they looked at the small Pacific island of Yap where they used giant round stones as money. When a stone changes hand because of a payment, as the stone is large and heavy, the stone remains where it is and everyone on the island just knows it belongs to someone different. If you think that is strange, it is not that different from the way we manage gold. The gold bars sit in a bank vault and their ownership is digital bits recorded on a disk that is revolving at 7200 RPM. When the gold changes hands, a new record of ownership is written to the disk, however the gold remains exactly where it is. I will have to write more about virtual goods in real economies another time.
Showing posts with label Sightings. Show all posts
Showing posts with label Sightings. Show all posts
Sunday, June 19, 2011
Sunday, February 06, 2011
Revolution: The First 2000 Years of Computing
For years, the Computer History Museum (CHM) has a open storage area where they put their collection of old computers, but without any interpretation except for docent led tours. I had no problem wandering through this treasure trove because I knew a lot about what they had on show, from slide rules and abacuses to the Control Data 6600 and the Cray machines. Even then, a docent could help by pointing out features that I would miss, such as the ash tray on each workstation of the Sage early warning computer system.
Now the CHM has opened their "Revolution: The First 2000 Years of Computing" exhibition, and I recommend a visit. They still have all the interesting computer hardware as they had in the visible storage area, however it is placed in a larger space and there is all kind of interpretive help from explanation of the exhibits to video clips that you can browse. In my visit, I saw a lot of new things and learned much.
For example, Napier's Bones are an old time calculation aid that turns long multiplication into addition. The Napier's Bones exhibit explains how they work and allows you to do calculations using a set. The exhibit on computers and rocketry has the guidance computer for a large missile arrayed in a circle around the inside of the missile skin leaving an ominously empty space in the middle for the payload. In the semiconductor area they had examples of silicon wafers that ranged from the size of a small coin from the early days to a current wafer that is the size of a large dinner plate. There is also an interesting video discussion of the marketing of the early microprocessors like the 8086, the Z8000, the M68000 and the absolute importance of landing the design win for the IBM PC that led to the current era where Intel is biggest and most profitable chip maker. These are just a sample of the many fascinating exhibits there.
I spent over 2 hours in the exhibition and only managed to get through half of it. I am a long time member of the museum and can go back any time, so this is a warning to non-members to allow enough time for their visit.
Now the CHM has opened their "Revolution: The First 2000 Years of Computing" exhibition, and I recommend a visit. They still have all the interesting computer hardware as they had in the visible storage area, however it is placed in a larger space and there is all kind of interpretive help from explanation of the exhibits to video clips that you can browse. In my visit, I saw a lot of new things and learned much.
For example, Napier's Bones are an old time calculation aid that turns long multiplication into addition. The Napier's Bones exhibit explains how they work and allows you to do calculations using a set. The exhibit on computers and rocketry has the guidance computer for a large missile arrayed in a circle around the inside of the missile skin leaving an ominously empty space in the middle for the payload. In the semiconductor area they had examples of silicon wafers that ranged from the size of a small coin from the early days to a current wafer that is the size of a large dinner plate. There is also an interesting video discussion of the marketing of the early microprocessors like the 8086, the Z8000, the M68000 and the absolute importance of landing the design win for the IBM PC that led to the current era where Intel is biggest and most profitable chip maker. These are just a sample of the many fascinating exhibits there.
I spent over 2 hours in the exhibition and only managed to get through half of it. I am a long time member of the museum and can go back any time, so this is a warning to non-members to allow enough time for their visit.
Tuesday, November 16, 2010
Yeah, Yeah, Yeah
This morning I woke up to the local newspaper headline "Do you want to know a Secret?", and knew that something was going on. Later they changed their tune to something more like the The Wall Street Journal which starts their piece "Steve Jobs is nearing the end of his long and winding pursuit of the Beatles catalog." Other newspapers had headlines like "All you need is iTunes", "Let it be Available" and "Apple and The Beatles finally come together on iTunes". All in all, it seems like bunch stupid headline tricks from the old media, a sure sign that they are getting past it.
Meanwhile the new media is a lot more standoffish. Wired News is like "Yawn". TechCrunch is all business with "All 17 Beatles Albums Are In The Top 100 On iTunes". Of course Fake Steve Jobs had a field day, providing by far the best commentary on the whole event.
Meanwhile the new media is a lot more standoffish. Wired News is like "Yawn". TechCrunch is all business with "All 17 Beatles Albums Are In The Top 100 On iTunes". Of course Fake Steve Jobs had a field day, providing by far the best commentary on the whole event.
Monday, July 05, 2010
The HP Tablet and the Elephant
Recently HP bought Palm and in the acquisition press release announced that they are developing "... webOS based hardware products, from a robust smartphone roadmap to future slate PCs and netbooks". In all the discussion of this event, nobody seems to be discussing the elephant in the room, or more correctly, the elephant who is no longer in the room.
Ten years ago, HP would not have dared announce that it was going produce its own operating system (OS) in competition with the dominant Microsoft Windows OS. Then, most hardware developers had been cowed by Microsoft's aggressive and successful response to any attempt to develop a rival operating system. To give a couple of examples, in the early 90's the Go Corporation had developed its Penpoint OS for handheld computing. Then in 1992, Microsoft announced its own Windows for Pen Computing. Go Corporation faltered, was taken over by AT&T and then the project was shuttered. Another example is the fate of Be Inc. who had developed BeOS, initially to power their own hardware. In 2002, Be Inc. sued Microsoft claiming that Hitachi had been dissuaded from selling PCs loaded with BeOS, and that Compaq had been pressured to not market an Internet appliance in partnership with Be. The case was eventually settled out of court with no admission of liability on Microsoft's part. However by this time Be Inc had admitted defeat and sold its intellectual property to Palm Inc.
In the late 90's Microsoft was so dominant that no Silicon valley Venture Capital firm would fund a start up that would have the remotest chance of challenging Microsoft in any way. Since then Microsoft seems to have been transformed from a lithe competitor into a stumbling giant. The Vista version of the Windows OS is widely regarded as a failure, and was quickly replaced by Windows 7. While the Windows Mobile OS for smartphones has been around for a long time and gone through several versions, it has been losing market share for some time. Recently Microsoft introduced a new smartphone, the Kin with much ballyhoo, only to give up on it six week later. There are plenty other examples of Microsoft's left hand not knowing what the right hand was doing, like the PlayForSure debacle.
We have come to the point where Microsoft is so crippled by its own self inflicted wounds that one of its most important OEM customers is going to use its own operating system on future slate PCs and netbooks. The elephant is no longer in the room.
Ten years ago, HP would not have dared announce that it was going produce its own operating system (OS) in competition with the dominant Microsoft Windows OS. Then, most hardware developers had been cowed by Microsoft's aggressive and successful response to any attempt to develop a rival operating system. To give a couple of examples, in the early 90's the Go Corporation had developed its Penpoint OS for handheld computing. Then in 1992, Microsoft announced its own Windows for Pen Computing. Go Corporation faltered, was taken over by AT&T and then the project was shuttered. Another example is the fate of Be Inc. who had developed BeOS, initially to power their own hardware. In 2002, Be Inc. sued Microsoft claiming that Hitachi had been dissuaded from selling PCs loaded with BeOS, and that Compaq had been pressured to not market an Internet appliance in partnership with Be. The case was eventually settled out of court with no admission of liability on Microsoft's part. However by this time Be Inc had admitted defeat and sold its intellectual property to Palm Inc.
In the late 90's Microsoft was so dominant that no Silicon valley Venture Capital firm would fund a start up that would have the remotest chance of challenging Microsoft in any way. Since then Microsoft seems to have been transformed from a lithe competitor into a stumbling giant. The Vista version of the Windows OS is widely regarded as a failure, and was quickly replaced by Windows 7. While the Windows Mobile OS for smartphones has been around for a long time and gone through several versions, it has been losing market share for some time. Recently Microsoft introduced a new smartphone, the Kin with much ballyhoo, only to give up on it six week later. There are plenty other examples of Microsoft's left hand not knowing what the right hand was doing, like the PlayForSure debacle.
We have come to the point where Microsoft is so crippled by its own self inflicted wounds that one of its most important OEM customers is going to use its own operating system on future slate PCs and netbooks. The elephant is no longer in the room.
Sunday, May 09, 2010
Google Books Rocks
Awesome is too small a word to express what Google Books has achieved. Last year Google settled the class action law suit that allows them to index out of print books that they had digitized. As part of the settlement they also have to sell the books, which means that Google is now a bookseller. The most important part of the settlement is the Books Right Registry:
I will write more about this issue another day. For now, here is how I stumbled upon the awesomeness of Google Books. My father would often quote "but tomorrow by the living god, we'll try the game again" after some setback. I knew it was from a poem, but not much more. So the other day, I typed "but tomorrow by the living god" into Google and was astonished by the progress that has been made in search over the last few years. The first entry in the search results linked to a poetry anthology in Google Books that has the full poem by John Masefield.
Masefield is best known for his poems "Sea Fever", "I must go down to the seas again, to the lonely seas and the sky, ..." and "Cargoes", "Quinquireme of Nineveh from distant Ophir, ..." For poem collectors, here is the rarely seen poem TOMORROW by John Masefield:
"The agreement will also create an independent, not-for-profit Book Rights Registry to represent authors, publishers and other rightsholders. In essence, the Registry will help locate rightsholders and ensure that they receive the money their works earn under this agreement. You can visit the settlement administration site, the Authors Guild or the AAP to learn more about this important initiative."One of the biggest practical issue with Intellectual Property is that it is impossible to use most Intellectual Property because you do not know who owns it, and therefore you do not know who to ask for permission to use it. Laurence Lessig has been talking about this for a long time as a part of his campaign to fix copyright laws. The establishment of a Book Rights Registry goes some way to address the problem with one type of Intellectual Property. Perhaps this will be the beginning of a trend.
I will write more about this issue another day. For now, here is how I stumbled upon the awesomeness of Google Books. My father would often quote "but tomorrow by the living god, we'll try the game again" after some setback. I knew it was from a poem, but not much more. So the other day, I typed "but tomorrow by the living god" into Google and was astonished by the progress that has been made in search over the last few years. The first entry in the search results linked to a poetry anthology in Google Books that has the full poem by John Masefield.
Masefield is best known for his poems "Sea Fever", "I must go down to the seas again, to the lonely seas and the sky, ..." and "Cargoes", "Quinquireme of Nineveh from distant Ophir, ..." For poem collectors, here is the rarely seen poem TOMORROW by John Masefield:
Oh yesterday the cutting edge drank thirstily and deep,In my original search results, there was a link to Google newspapers where a Virgin Islands Daily News edition from 1950 quotes part of the poem. This time when I did the search, that link did not come up. Instead there was a link to a 1991 zine for Vietnam War vets that quotes a verse of the poem. Who knows what you may find when you do the search.
The upland outlaws ringed us in and herded us as sheep,
They drove us from the stricken field and bayed us into keep;
But tomorrow
By the living God, we'll try the game again!
Oh yesterday our little troop was ridden through and through,
Our swaying, tattered pennons fled a broken, beaten few,
And all a summer afternoon, they hunted us and slew;
But tomorrow
By the living God, we'll try the game again!
And here upon the turret-top the bale-fires glower red,
The wake-lights burn and drip about our hacked, disfigured dead,
And many a broken heart is here and many a broken head;
But tomorrow
By the living God, we'll try the game again!
Sunday, February 14, 2010
Predatory Lending
While the practice of Predatory Lending is difficult to define, it is easy to see the results, people stuck with high priced loans that they cannot get out of. Today I saw a couple of references to an article in the Washington Post that reports more than half of of the mortgages in the US have an interest rate that is greater than 6% while for the last year the mortgage interest rate has been hovering around 5%. This means that over half the homeowners in the US are unable to refinance their mortgages to take advantage of a lower interest rate.
Many people think of predatory lending as something like payday lending to the poor. In practice it happens at all levels of the economy. At the highest level there are the exploits of the "economic hit man" whose job was to enable the selling of economic development loans to poor countries that could ill afford them. Recently, the economic woes of Greece may have been exacerbated by clever derivative swaps from Goldman Sachs, designed to hide the true nature of the debt that it owed.
Predatory housing loans inflamed the housing bubble, sticking the middle classes with high priced loans cleverly disguised with low initial teaser rates. Now the middle classes are stuck with loans that they cannot refinance because their houses are underwater or because they do not have a job, a good enough job or the credit rating for the refinance to go ahead. This is a yet further drag on the economy, already in recession. As the Washington Post article says:
Many people think of predatory lending as something like payday lending to the poor. In practice it happens at all levels of the economy. At the highest level there are the exploits of the "economic hit man" whose job was to enable the selling of economic development loans to poor countries that could ill afford them. Recently, the economic woes of Greece may have been exacerbated by clever derivative swaps from Goldman Sachs, designed to hide the true nature of the debt that it owed.
Predatory housing loans inflamed the housing bubble, sticking the middle classes with high priced loans cleverly disguised with low initial teaser rates. Now the middle classes are stuck with loans that they cannot refinance because their houses are underwater or because they do not have a job, a good enough job or the credit rating for the refinance to go ahead. This is a yet further drag on the economy, already in recession. As the Washington Post article says:
"More refinancing activity would have helped household budgets, but also the national economy because homeowners might have spent some of the extra cash they pocketed, giving the recovery an added lift."Homeowners do have an option. As Roger Lowenstein writes in the New York Times "Walk Away From Your Mortgage". Part of his argument is that banks are walking away from their mortgage obligations, and the American people should not feel obliged to behave better than the corporations who sold them their home loans in the first place. I would add to that argument that much of the vitality of the US economy comes from labor mobility. Having people stuck in a home that they cannot sell because their loan is underwater and unable to get a job nearby is yet another drag on the economy.
Sunday, December 27, 2009
Kindle Chronicles
Amazon announced that "On Christmas Day, for the first time ever, customers purchased more Kindle books than physical books." Well duh! If you want a physical book for Christmas, you have to buy it before Christmas day. On the other hand, every one who received a Kindle as a gift used the wireless book download feature to get a book to read on Christmas day. In the very same announcement, Amazon said that "Kindle has become the most gifted item in Amazon's history". Amazon's statement is a nice piece of spin but not a lot more.
More interesting commentary on electronic book readers is found in the Kindle Chronicles blog. In the early days of emusic, musicians generally stood by their record companies. Book authors seem to be a much more independent lot according to the most recent post "What We Have Here Is a Failure To Communicate". The publishers have been trying to preserve their position by keeping the prices of ebooks high, while the authors want to be read and the books that sell most on the Kindle are the cheaper ones. Also authors do not see why the publishers should get such a large share of the revenue when there is no cost to their ebook inventory.
More interesting commentary on electronic book readers is found in the Kindle Chronicles blog. In the early days of emusic, musicians generally stood by their record companies. Book authors seem to be a much more independent lot according to the most recent post "What We Have Here Is a Failure To Communicate". The publishers have been trying to preserve their position by keeping the prices of ebooks high, while the authors want to be read and the books that sell most on the Kindle are the cheaper ones. Also authors do not see why the publishers should get such a large share of the revenue when there is no cost to their ebook inventory.
Wednesday, October 14, 2009
e-Readers for All
The e-Reader market is heating up, just in time for Christmas. Amazon is expanding features and bringing the Kindle down the price curve. Today came word of the Barnes and Noble e-Reader with two screens, an e-ink screen for reading and a small LCD touch screen for interactivity.
Also today I caught up with the "This Week in Tech" podcast from last weekend where they talked about the real killer features of the Kindle - wireless download and almost unlimited capacity. You can buy as many books as you want any time you want, which leads to buying many more books than you would otherwise buy. Imagine the scene, at dinner with your friends, you discuss books that you have recently read, and bam you buy the books they recommend there and then. In fact there was even a cry in the podcast "Friends don't let friends use a Kindle while drunk" (for fear that the judgmentally impaired friend may buy too many books).
When the original Kindle came out there was a tremendous outcry against it with people complaining of gadgets destroying their book reading experience and authors expecting to have their livelihood destroyed just as the music industry has been laid waste. Hint, musicians are doing just as well as they have always done, it is the music moguls with their "by the way, which one is Pink?" who have been laid waste. The Kindle stimulates the publishing industry and makes it much easier to buy books, leading to more sales where author gets a larger slice of the pie.
Competition is good, particularly for the consumer. The e-Reader needs another generation or so to iron out the kinks and bring the price down to the mass market levels. I am waiting for the $149 price point (iPod Nano) which should come by next Christmas if not sooner.
Also today I caught up with the "This Week in Tech" podcast from last weekend where they talked about the real killer features of the Kindle - wireless download and almost unlimited capacity. You can buy as many books as you want any time you want, which leads to buying many more books than you would otherwise buy. Imagine the scene, at dinner with your friends, you discuss books that you have recently read, and bam you buy the books they recommend there and then. In fact there was even a cry in the podcast "Friends don't let friends use a Kindle while drunk" (for fear that the judgmentally impaired friend may buy too many books).
When the original Kindle came out there was a tremendous outcry against it with people complaining of gadgets destroying their book reading experience and authors expecting to have their livelihood destroyed just as the music industry has been laid waste. Hint, musicians are doing just as well as they have always done, it is the music moguls with their "by the way, which one is Pink?" who have been laid waste. The Kindle stimulates the publishing industry and makes it much easier to buy books, leading to more sales where author gets a larger slice of the pie.
Competition is good, particularly for the consumer. The e-Reader needs another generation or so to iron out the kinks and bring the price down to the mass market levels. I am waiting for the $149 price point (iPod Nano) which should come by next Christmas if not sooner.
Monday, September 07, 2009
Ikea Culture
We live in an Ikea world. I like to find excuses to visit the nearest Ikea in Palo Alto to lunch in their cafeteria, eating either a smoked salmon plate or Swedish meatballs with Lingonberry jam. The cafeteria has a great view over the South Bay and the East Bay hills. However the reason for this post is to note that Ikea has been popping up in the conversation all over the world.
In China, the Ikea stores have become a great success, for the people, if not for Ikea. This LA Times story reports that Chinese people are flocking to the local Ikea store, to test the bedding, hang out and eat in the cafeteria, maybe even buy some plates, just not to buy anything big.
Meanwhile in LA itself, several young aspiring producers have noticed that an Ikea store is just like a movie studio with lots of little well lit sets showing off bedrooms, living rooms, kitchens. Just the place to make a short episode on the cheap. The actors mike up with wireless mikes outside, rush in and take a few shots and then rush out before any employees notice. Here is Ikea Hights, a soap opera, and here is a send up of The Real World.
Finally, as reported in the New York Times, there has been outrage over the decision by Ikea to change the font in their latest catalog from Futura to Verdana. Futura is a well respected modern san-serif font that suits the Ikea style. Verdana is the generic Microsoft version of a san-serif font that comes on every computer with Windows. I am not sure why this is so important, are these people really complaining that Ikea has lowered its standards to encompass the lowest common denominator font?
In China, the Ikea stores have become a great success, for the people, if not for Ikea. This LA Times story reports that Chinese people are flocking to the local Ikea store, to test the bedding, hang out and eat in the cafeteria, maybe even buy some plates, just not to buy anything big.
Meanwhile in LA itself, several young aspiring producers have noticed that an Ikea store is just like a movie studio with lots of little well lit sets showing off bedrooms, living rooms, kitchens. Just the place to make a short episode on the cheap. The actors mike up with wireless mikes outside, rush in and take a few shots and then rush out before any employees notice. Here is Ikea Hights, a soap opera, and here is a send up of The Real World.
Finally, as reported in the New York Times, there has been outrage over the decision by Ikea to change the font in their latest catalog from Futura to Verdana. Futura is a well respected modern san-serif font that suits the Ikea style. Verdana is the generic Microsoft version of a san-serif font that comes on every computer with Windows. I am not sure why this is so important, are these people really complaining that Ikea has lowered its standards to encompass the lowest common denominator font?
Sunday, July 26, 2009
Twittering Foodies
Given these difficult economic times, the latest trend in San Francisco dining is the unresturant, according to San Francisco Magazine. That is a posh way of describing eating from a food cart or truck. For example: Spenser-On-The-Go serves Caper Braised Skate Cheeks or Frogs Legs and Curry from a converted Taco truck; Boccalone serves exquisite pulled pork sandwiches from a bicycle; the Creme Brulee Cart and Magic Curry Kart are just street carts.
As the vendors come and go and many of them are not properly licensed, the only way to find out where they are going to be serving is to follow them on Twitter. At last! a purpose for Twitter, if you are a committed foodie. As I have not quite gotten to the Escargot Puffs level yet, I have not yet joined Twitter, although I can see a glimmer of hope. On the other hand David Letterman is still firmly in the camp that twitter is a colossal waste of time as this hilarious segment with Kevin Spacey shows.
As the vendors come and go and many of them are not properly licensed, the only way to find out where they are going to be serving is to follow them on Twitter. At last! a purpose for Twitter, if you are a committed foodie. As I have not quite gotten to the Escargot Puffs level yet, I have not yet joined Twitter, although I can see a glimmer of hope. On the other hand David Letterman is still firmly in the camp that twitter is a colossal waste of time as this hilarious segment with Kevin Spacey shows.
Saturday, July 11, 2009
Graphs That Suck
Many years ago in the early days of the web, I learned about web site design by reading "Web Pages That Suck: Learn Good Design by Looking at Bad Design". It is a delightfully easy beginner level crawl through web site design, filled with examples ranging from excellent to awful with a capital 'A'. I would recommend the book
today except that the examples that make up the bulk of the book are way out of date.
For Business Intelligence the equivalent would be a book called something like "Graphs that Suck", and Stephen Few's Perceptual Edge blog is a good place to find examples of this genre. Recently they posted a spectacularly bad example, a pie chart put out by Business Objects to promote a user conference. I will not repeat the critique, however I will say that if this is an example of what Business Objects thinks their software should be used for, I would be leery of using it!
today except that the examples that make up the bulk of the book are way out of date.For Business Intelligence the equivalent would be a book called something like "Graphs that Suck", and Stephen Few's Perceptual Edge blog is a good place to find examples of this genre. Recently they posted a spectacularly bad example, a pie chart put out by Business Objects to promote a user conference. I will not repeat the critique, however I will say that if this is an example of what Business Objects thinks their software should be used for, I would be leery of using it!
Friday, July 03, 2009
Musician Uses Twitter to Her Advantage, Shock Horror Probe
Technology is turning the music business upside down, like any other media business. Some people embrace the change and some people decry it. When I read a post like this one about using Twitter to make money, I always read the comments. Whether the post is at the Berklee School of Music or TechCrunch, the range of responses is wide and consistent. Some commenters accept the new world and cheer it on, while others complain bitterly. Typical complaints range from: "I cannot do that because I do not have any fans" through "people should respect copyright and give me the money I am due" to "the record company put you there so you should give it all back to them".
The most ridiculous response is the complaint that a musician who spends time developing their fan base is wasting time that could be better spend on creative activities. The point of the Amanda Palmer post is that if you are properly organized, it does not take a lot of time or effort to keep in contact with your fans, particularly when using new instant communication tools like Twitter.
Technology changes. Music is no longer distributed as sheets of paper or by stamping it on 5, 7 or 12 inch pieces of plastic. The business model must change with the times.
The most ridiculous response is the complaint that a musician who spends time developing their fan base is wasting time that could be better spend on creative activities. The point of the Amanda Palmer post is that if you are properly organized, it does not take a lot of time or effort to keep in contact with your fans, particularly when using new instant communication tools like Twitter.
Technology changes. Music is no longer distributed as sheets of paper or by stamping it on 5, 7 or 12 inch pieces of plastic. The business model must change with the times.
The moving finger [of technology change] writes; and having writ,HT to Roger for the Berklee post.
Moves on: nor all your piety nor wit
Shall lure it back to cancel half a line,
Nor all your tears wash out a word of it.
Saturday, May 02, 2009
The Next Revolution in Data Management
Cringely wrote a great post today called "The Sequel Dilemma". His point is that we are in the midst of a revolution in the way we do data management, the database is the like a horse and buggy soon to be run over by the next generation of data management tools like, for example, the Google database system that I wrote about last year. I particularly liked his comment:
Right now almost every web application has an Apache server fronting a database box running MySQL or its closed source equivalent like Oracle, DB2, or SQL Server. The data bottleneck in all those applications is the SQL box, which is generally doing a very simple job in a very complex manner that made total sense for minicomputers in 1975 but doesn’t make as much sense today.
Sunday, March 29, 2009
Understanding Salesforce.com
I was out of town and could not attend the SDForum SAM SIG meeting on the Salesforce.com architecture, which was a shame as it seems to have been a fascinating presentation. I have been following Salesforce.com for some time. We had them present to the SDForum Business Intelligence SIG in 2002. In 2006, Ken Rudin an early Salesforce.com employee gave an interesting presentation on his experience to the SDForum SaaS SIG.
On the one hand Salesforce.com has built the first really successful Software as a Service (SaaS) application and continue to grow the company year after year. On the other hand there is a certain amount of hype surrounding the company. Here is the unvarnished story of what they do. In the USA, there are tens of thousands of companies with distributed sales forces. Each company has to keep in contact and track what its salespeople are doing, where each salesperson works out of their home or an anonymous office suite far from headquarters. Salesforce.com provides the application to manage a distributed sales force. It is as simple as that.
Salesforce.com is the perfect web based SaaS application. There is a large client base. Each client's problem is to keep contact with a distributed sales force, dictating a web enabled application. There are many small clients who do not have the resources to implement their own sales force management application. In practice each client needs the same basic functions in their application, with some minor variations.
Salesforce.com started out by offering their application to the smaller clients who needed a few seats and would have the most difficulty in implementing their own stand alone software application. With experience they made their application economic to medium sized clients with hundreds of seats. Eventually they got to the point where they could effectively support the largest clients like Merrill Lynch with 25000 seats.
On the one hand Salesforce.com has built the first really successful Software as a Service (SaaS) application and continue to grow the company year after year. On the other hand there is a certain amount of hype surrounding the company. Here is the unvarnished story of what they do. In the USA, there are tens of thousands of companies with distributed sales forces. Each company has to keep in contact and track what its salespeople are doing, where each salesperson works out of their home or an anonymous office suite far from headquarters. Salesforce.com provides the application to manage a distributed sales force. It is as simple as that.
Salesforce.com is the perfect web based SaaS application. There is a large client base. Each client's problem is to keep contact with a distributed sales force, dictating a web enabled application. There are many small clients who do not have the resources to implement their own sales force management application. In practice each client needs the same basic functions in their application, with some minor variations.
Salesforce.com started out by offering their application to the smaller clients who needed a few seats and would have the most difficulty in implementing their own stand alone software application. With experience they made their application economic to medium sized clients with hundreds of seats. Eventually they got to the point where they could effectively support the largest clients like Merrill Lynch with 25000 seats.
Saturday, March 14, 2009
Twitter is the new Black
This is the age of Twitter. In the last couple of weeks, both Doonesbury and Jon Stewart have made fun of it. Members of the technorati who have been using Twitter for some time and have built up a solid following have suddenly found their lead in the number of followers eviscerated as Twitter goes mainstream and people we have all heard of become the most popular. As might be expected, the loudest complaints have come from Dave Whiner.
I have written about Twitter in the past and how it relates to various feed technologies. However I must confess that I do not use the service for the simple reason that I have no use it. We live in a very noisy world. I want to keep the noise level down, and Twitter seems to just increases the noise.
For example, when I first started using RSS to follow stuff, I subscribed to feeds from all the places that I regularly follow. Then I realized that there is no point in using RSS to follow a site that publishes several times a day. If I want to see what they have to say, I can just go to the site at any time and see their latest stuff. So I cut my RSS subscriptions back to the sites that publish infrequently. That way a quick daily look at my RSS feeds allows me to catch up with all sorts things without being overloaded.
That is not to say that I do not see a value in Twitter, it is just that I do not see a use case for my using Twitter now. Twitter is of most use for people whose job is about communications. My job is to get things done, and to do that, I often need to switch off the outside world to reduce the noise.
This attitude to Twitter could easily change. Many years ago, a friend suggested that I use Instant Messaging (IM). At the time I had no use for it and did not subscribe. A couple of years later, my manager asked that all reports be available through IM whenever they were working, so that, for example the manager could ask a question of anyone from a meeting. Ever since then I have been online in IM whenever I have been at work. At a minimum, it shows my colleagues in a distributed organization that I am at work and available. Just as I found a use for IM, I could find a use for Twitter.
I have written about Twitter in the past and how it relates to various feed technologies. However I must confess that I do not use the service for the simple reason that I have no use it. We live in a very noisy world. I want to keep the noise level down, and Twitter seems to just increases the noise.
For example, when I first started using RSS to follow stuff, I subscribed to feeds from all the places that I regularly follow. Then I realized that there is no point in using RSS to follow a site that publishes several times a day. If I want to see what they have to say, I can just go to the site at any time and see their latest stuff. So I cut my RSS subscriptions back to the sites that publish infrequently. That way a quick daily look at my RSS feeds allows me to catch up with all sorts things without being overloaded.
That is not to say that I do not see a value in Twitter, it is just that I do not see a use case for my using Twitter now. Twitter is of most use for people whose job is about communications. My job is to get things done, and to do that, I often need to switch off the outside world to reduce the noise.
This attitude to Twitter could easily change. Many years ago, a friend suggested that I use Instant Messaging (IM). At the time I had no use for it and did not subscribe. A couple of years later, my manager asked that all reports be available through IM whenever they were working, so that, for example the manager could ask a question of anyone from a meeting. Ever since then I have been online in IM whenever I have been at work. At a minimum, it shows my colleagues in a distributed organization that I am at work and available. Just as I found a use for IM, I could find a use for Twitter.
Thursday, February 12, 2009
Musician versus Recording Industry
I just happened to notice this quote in an interview with The Reverend Horton Heat in the San Jose Mercury News:
Secondly, while listening to recorded music is OK, nothing beats a good live musical performance. I could give many examples of memorable musical performances that I have witnessed in person. A good recording of a good live performance beats a sterile studio performance any day. For example, many, many years ago I happened to tape Ian Dury and the Blockheads performing live for the BBC. That performance was so much more alive than any of their studio albums. When I buy music these days, I prefer to buy a live performance.
Finally, as the good "Reverend" says, in the history of music, the recording is but a blip. The recording industry came to power in just the last 50 years by controlling the means of production and now that they no longer have that control they will surely fade.
I agree with this entirely for many reasons. Firstly, it fits in well with the new reality of zero cost replication of recorded music. As many people have said, myself included, the new business of music is to give away recorded music to promote live performance."To me, being a recording artist is barely a valid art form," Heath says by telephone from a tour stop in Fort Collins, Colo. "It's almost like being in the advertising business, because in the long, storied history of music, only a small percentage of that history involves recording technology.
"Music was always a live event. It's a linear art form. You play some notes, they go out and they're gone forever. To try to reduce that to a static art form is wrong."
Secondly, while listening to recorded music is OK, nothing beats a good live musical performance. I could give many examples of memorable musical performances that I have witnessed in person. A good recording of a good live performance beats a sterile studio performance any day. For example, many, many years ago I happened to tape Ian Dury and the Blockheads performing live for the BBC. That performance was so much more alive than any of their studio albums. When I buy music these days, I prefer to buy a live performance.
Finally, as the good "Reverend" says, in the history of music, the recording is but a blip. The recording industry came to power in just the last 50 years by controlling the means of production and now that they no longer have that control they will surely fade.
Tuesday, December 30, 2008
Notes from the Dismal Science
Over the Christmas break, I have been reading "The Return Of Depression Economics" by Paul Krugman. There are good reasons why they call Economics the Dismal Science. The worse the financial situation becomes, the more there is to analyze, discuss and comment on. These are exciting times to be an Economist. I will report more on the book later, in the mean time here are some thoughts on the Dismal Science.
To my delight, the current Wikipedia entry on the Dismal Science calls it a derogatory alternative name for Economics and tries to contrast it with the "The Gay Science", the title of a book by the philosopher Nietzsche. The "Gay Science" of the books title is apparently the technique of poetry writing. It also claims that the first reference to Dismal Science is in a pamphlet published by Thomas Carlyle. The problem with all this is that the dates do not match up. The best known dismal economist is Malthus who published the first version of his pamphlet on the impending doom of population explosion in 1798. The Carlyle pamphlet was published in 1849 and Nietzsche's The Gay Science was published in 1882.
One interesting thing about Malthus is his use of mathematical models to explain his thesis. His argument was that population growth is exponential while the growth in food supply is linear, leading future generations to have more and more people fighting for proportionally less food. Nowadays economists still use mathematical models to explain their positions, although they have now graduated to sometimes using differential equations to make their point. In my time, I have known several applied mathematicians. Their models are always second order differential equations and they always oscillate, just like our financial fortunes.
Another branch of mathematics with relevance is Game Theory. Derivative trading is a zero sum game. That is, one persons gain is another persons loss. I believe that bond trading is also a zero sum game as well. In a properly open market with good information, trading in bonds and derivatives should be a straightforward and relatively low profit enterprise. For at least 20 years, as depicted first in Bonfire of the Vanities and Liar's Poker, it has been exactly the opposite. The market players have conspired to hide information and keep the market inefficient so that they can reward themselves with enormous profits from trading.
Note that derivative and bond trading is only a zero sum game when they do not default. Adding defaults makes bond trading a manly game where the best can win. Thus, are defaults necessary to justify the the profits and bonuses that Wall Street firms have been paying? Is it a matter of: "It is not enough to succeed, others must fail"? Could it be that these ridiculous collateralize debt obligation bonds were deliberately created so that some of them would fail?
To my delight, the current Wikipedia entry on the Dismal Science calls it a derogatory alternative name for Economics and tries to contrast it with the "The Gay Science", the title of a book by the philosopher Nietzsche. The "Gay Science" of the books title is apparently the technique of poetry writing. It also claims that the first reference to Dismal Science is in a pamphlet published by Thomas Carlyle. The problem with all this is that the dates do not match up. The best known dismal economist is Malthus who published the first version of his pamphlet on the impending doom of population explosion in 1798. The Carlyle pamphlet was published in 1849 and Nietzsche's The Gay Science was published in 1882.
One interesting thing about Malthus is his use of mathematical models to explain his thesis. His argument was that population growth is exponential while the growth in food supply is linear, leading future generations to have more and more people fighting for proportionally less food. Nowadays economists still use mathematical models to explain their positions, although they have now graduated to sometimes using differential equations to make their point. In my time, I have known several applied mathematicians. Their models are always second order differential equations and they always oscillate, just like our financial fortunes.
Another branch of mathematics with relevance is Game Theory. Derivative trading is a zero sum game. That is, one persons gain is another persons loss. I believe that bond trading is also a zero sum game as well. In a properly open market with good information, trading in bonds and derivatives should be a straightforward and relatively low profit enterprise. For at least 20 years, as depicted first in Bonfire of the Vanities and Liar's Poker, it has been exactly the opposite. The market players have conspired to hide information and keep the market inefficient so that they can reward themselves with enormous profits from trading.
Note that derivative and bond trading is only a zero sum game when they do not default. Adding defaults makes bond trading a manly game where the best can win. Thus, are defaults necessary to justify the the profits and bonuses that Wall Street firms have been paying? Is it a matter of: "It is not enough to succeed, others must fail"? Could it be that these ridiculous collateralize debt obligation bonds were deliberately created so that some of them would fail?
Sunday, November 23, 2008
Fear and Loathing in my 401K
Every so often you need to sit back and take a more detached look at what is going on, particularly when there seems to be a new event every day. The current issue is the all engulfing financial crisis. Taking the long view allows you to look past the current pain in your 401K. Like may others I know that I am not going to be retiring any time soon. I have commented previously on the risk of unregulated markets, here are some more thoughts.
One big question is who is responsible. One group of people are working hard to establish that is is not the responsibility of the current hapless President, but is something that was foisted on him by his wily predecessor and the Democratic Congress from way back when. Well, if you believe that the role of government is to stand aside and let events unfurl, as the administration has on several occasions, then it is clearly not the responsibility of George W Bush. On the other hand, if you believe that the role of government is to at the very least steady the tiller, then the current administration has been asleep at the wheel.
Another thought is that nobody is responsible, it is just a natural consequence of a complex financial system. Several people have commented that the complex derivatives made the system less volatile, however they also increased the probability of a huge collapse. I was reminded of a blog post from some time ago that referenced an IEEE Spectrum article that electrical blackouts are inevitable. This was after the big blackout of 2004. If the conclusion is that the highly regulated and controlled electrical industry will have a big blackout every 35 years or so, then the loosely regulated financial is also bound to have big blackouts every so often. Chaos theory rules.
Here are some of people who I have been following:
One big question is who is responsible. One group of people are working hard to establish that is is not the responsibility of the current hapless President, but is something that was foisted on him by his wily predecessor and the Democratic Congress from way back when. Well, if you believe that the role of government is to stand aside and let events unfurl, as the administration has on several occasions, then it is clearly not the responsibility of George W Bush. On the other hand, if you believe that the role of government is to at the very least steady the tiller, then the current administration has been asleep at the wheel.
Another thought is that nobody is responsible, it is just a natural consequence of a complex financial system. Several people have commented that the complex derivatives made the system less volatile, however they also increased the probability of a huge collapse. I was reminded of a blog post from some time ago that referenced an IEEE Spectrum article that electrical blackouts are inevitable. This was after the big blackout of 2004. If the conclusion is that the highly regulated and controlled electrical industry will have a big blackout every 35 years or so, then the loosely regulated financial is also bound to have big blackouts every so often. Chaos theory rules.
Here are some of people who I have been following:
- Paul Krugman, recent Nobel prize winner, called the problem in the housing market in 2005. He is a careful person who takes care that what he says is totally defensible. Something that I am sure infuriates his many detractors.
- Andrew Leonard on How the World Works pulls together a lot if interesting ideas. He muses on everything from the demise of petro-empires to the demise of his bank: Washington Mutual.
- Igor Greenwald's Taking Stock blog on Smart Money. The latest word from someone close to the trading floor on Wall Street.
- Michael Lewis left the money business and wrote Liar's Poker because he wanted to write and did not believe that the decade of greed could continue. Well, the financial world took another 20 years before it blew itself up, and Michael Lewis has just written a great retrospective article for Portfolio.
Saturday, November 08, 2008
Leonardo at The Tech
We visited the Leonardo exhibition at The Tech this afternoon. It is a huge exhibition. They suggest that you allow 2 hours for the tour. We were there for two hours and we rushed through the second half to such an extent that I will go back and do it again. The exhibition starts with Brunelleschi's Dome for the Duomo in Florence. Leonardo was an apprentice in Florence towards the end of its construction and it started his interest in mechanics.
After wandering through many halls of mechanical inventions, we came to the anatomy room where Leonardo takes his knowledge of mechanics and applies it to understanding how the human body works. It was after this that we had to pick up the pace just as the exhibits started to get really interesting. The exhibition then goes into his more cultural side which includes his painting and sculpture.
One thing that I got from the painting displays is that Leonardo's knowledge of both mechanics and anatomy informed his paintings. For example, there is an interesting display on the dynamics of the characters in The Last Supper. There is another display on his studies into understanding faces, expressions and the muscles that are used to form facial expressions. So, the inscrutable expression on Mona Lisa's face is no accident (this is my summize, I did not see a reference to Mona Lisa in the exhibition) .
I highly recommend that you see the Leonardo exhibition if you can, and suggest that you allow several hours to see it all properly. Also, do not spend too much time on the mechanics. It is a necessary introduction to understanding how Leonardo viewed the world but it is also important to see how he applied all this knowledge.
After wandering through many halls of mechanical inventions, we came to the anatomy room where Leonardo takes his knowledge of mechanics and applies it to understanding how the human body works. It was after this that we had to pick up the pace just as the exhibits started to get really interesting. The exhibition then goes into his more cultural side which includes his painting and sculpture.
One thing that I got from the painting displays is that Leonardo's knowledge of both mechanics and anatomy informed his paintings. For example, there is an interesting display on the dynamics of the characters in The Last Supper. There is another display on his studies into understanding faces, expressions and the muscles that are used to form facial expressions. So, the inscrutable expression on Mona Lisa's face is no accident (this is my summize, I did not see a reference to Mona Lisa in the exhibition) .
I highly recommend that you see the Leonardo exhibition if you can, and suggest that you allow several hours to see it all properly. Also, do not spend too much time on the mechanics. It is a necessary introduction to understanding how Leonardo viewed the world but it is also important to see how he applied all this knowledge.
Saturday, October 11, 2008
Its Called Risk, Have You Heard Of It?
Senator Phil Gramm famously called us a "nation of whiners" and he may be right. (Note, while I try to keep this blog about technology, the financial system seems to be so badly broken it is worthy of a comment or two.) I recently ran across a blog post on a financial site called "Our Timid Government Is Killing Us" by Michael Kao, CEO of Akanthos Capital Management. In it he complains about 4 things that the Government has not done to help resolve the financial crisis. I want to concentrate on one of there here. "Problem No. 2: Lehman's bankruptcy has severely eroded confidence between counterparties."
The problem is this. Over the last few weeks, financial institutions have become unwilling to trust one another and with good cause. The issue is Credit Default Swaps. This is a 60 Trillion dollar market (that is Trillion with a capital T) where financial institutions like banks and hedge funds (the parties) buy and sell insurance policies on bonds. The "This American Life" radio program and Podcast has very good and understandable explanation of the market and how it came to be.
There are two important things to understand about the credit default swap market. Firstly, it is completely unregulated. Senator Phil Gramm tacked a clause to keep the market unregulated to an appropriations bill in 2000 that was approved by 95 votes to 0 in the Senate. Secondly, the market is not transparent, that is the various parties to the market do not know what any other players position is. Note that these two features are the way the parties in the market wanted it. There has been great outcry about reducing financial regulations in the last few years.
Lack of transparency was not a problem until Lehman Brothers went bankrupt. They were a big player in the credit default swap market. Now all their credit default swap insurance policies are frozen by their bankruptcy. Anyone who sold a credit default swap policy and then laid off the bet by buying an equivalent credit default swap from Lehman Brothers is now on the hook to pay off the insurance policy on the bond without the compensation of being able to get Lehman Brothers to make good on their policy.
The lack of transparency means that nobody knows for sure about anyone else in the market. That is that anyone could go bankrupt tomorrow because they have bought credit default swaps from a bankrupt company like Lehman Brothers and they cannot make good on their promise of a credit default swaps that they have sold. Already AIG has needed a huge injection of government money to stay afloat, and others may be suffering as well. But no one knows what positions anyone else holds. So everyone is conserving their cash not lending it out to anyone else so that they will not lose it if the other party goes bankrupt. Thus are the credit markets constipated.
A final problem is that, because the market is unregulated, there are no capital requirements to back up a bet. I can sell a credit default swap insurance policy based on my good name. I immediately get a large sum of money which I can register as a profit. It is only later that I have to worry about a problem with the bond that I have insured defaulting (what are the chances of that?) This is how the market got to be 60 Trillion dollars in size.
The underlying issue is this. There is a large risk in trading in unregulated markets. The risk is made larger if the market is not transparent, because if one of the parties to the market goes bust nobody knows what their position is worth. These risks were not recognized in the credit default swap market and policies were sold at far too low a price to recognize these risks. If the market were regulated, like other markets are, these risks would not be there and the market could deal with usual events like a bankruptcy of a player.
Finally there is a risk to the nation in allowing an unregulated market to balloon to the size that the credit default swap market has. Bankruptcies happen all the time. the fact that the bankruptcy of a player has caused the entire financial marketplace to go into a swoon is bad for the nation. The players in the credit default swap market asked for an unregulated market and they got what they asked for. Now the risk of having an unregulated market has shown itself and as Senator Gramm tells them they should deal with it and stop whining.
I am not an apologist, I am a technologist who is interested in how things work.
The problem is this. Over the last few weeks, financial institutions have become unwilling to trust one another and with good cause. The issue is Credit Default Swaps. This is a 60 Trillion dollar market (that is Trillion with a capital T) where financial institutions like banks and hedge funds (the parties) buy and sell insurance policies on bonds. The "This American Life" radio program and Podcast has very good and understandable explanation of the market and how it came to be.
There are two important things to understand about the credit default swap market. Firstly, it is completely unregulated. Senator Phil Gramm tacked a clause to keep the market unregulated to an appropriations bill in 2000 that was approved by 95 votes to 0 in the Senate. Secondly, the market is not transparent, that is the various parties to the market do not know what any other players position is. Note that these two features are the way the parties in the market wanted it. There has been great outcry about reducing financial regulations in the last few years.
Lack of transparency was not a problem until Lehman Brothers went bankrupt. They were a big player in the credit default swap market. Now all their credit default swap insurance policies are frozen by their bankruptcy. Anyone who sold a credit default swap policy and then laid off the bet by buying an equivalent credit default swap from Lehman Brothers is now on the hook to pay off the insurance policy on the bond without the compensation of being able to get Lehman Brothers to make good on their policy.
The lack of transparency means that nobody knows for sure about anyone else in the market. That is that anyone could go bankrupt tomorrow because they have bought credit default swaps from a bankrupt company like Lehman Brothers and they cannot make good on their promise of a credit default swaps that they have sold. Already AIG has needed a huge injection of government money to stay afloat, and others may be suffering as well. But no one knows what positions anyone else holds. So everyone is conserving their cash not lending it out to anyone else so that they will not lose it if the other party goes bankrupt. Thus are the credit markets constipated.
A final problem is that, because the market is unregulated, there are no capital requirements to back up a bet. I can sell a credit default swap insurance policy based on my good name. I immediately get a large sum of money which I can register as a profit. It is only later that I have to worry about a problem with the bond that I have insured defaulting (what are the chances of that?) This is how the market got to be 60 Trillion dollars in size.
The underlying issue is this. There is a large risk in trading in unregulated markets. The risk is made larger if the market is not transparent, because if one of the parties to the market goes bust nobody knows what their position is worth. These risks were not recognized in the credit default swap market and policies were sold at far too low a price to recognize these risks. If the market were regulated, like other markets are, these risks would not be there and the market could deal with usual events like a bankruptcy of a player.
Finally there is a risk to the nation in allowing an unregulated market to balloon to the size that the credit default swap market has. Bankruptcies happen all the time. the fact that the bankruptcy of a player has caused the entire financial marketplace to go into a swoon is bad for the nation. The players in the credit default swap market asked for an unregulated market and they got what they asked for. Now the risk of having an unregulated market has shown itself and as Senator Gramm tells them they should deal with it and stop whining.
I am not an apologist, I am a technologist who is interested in how things work.
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