Dana Blankenhorn

China Winning the Internet of Systems

Our capitalist system has a way of developing and defining standards that was effective in the 20^th century but may be ineffective early in the 21^st.

We wait for the market to create a need, and to create a leader. Then everyone else gangs up on the leader and creates what they call a standard.

Think of Betamax and VHS. Sony was the first mover, and the other manufacturers ganged up on it to take the consumer market. Or think of Apple and Microsoft in PC operating systems, where Microsoft, IBM, and their OEMs convinced most of the market to wait six full years for a working user interface Apple had introduced in 1984. The same thing is happening with Apple and Google in phones, although in this case Apple has managed to sponge off most of the profits and leave the OEMs toting Google’s laundry and holding the bag.

But there are areas of technology where that process doesn’t work, where only the government can create and enforce standards because the players are too selfish and diffuse to accomplish it themselves.

It’s why the Internet is the way it is. I was covering the story at the time it happened, so I know.

Revolt of the Viewer

The biggest life change in decades is now beginning. We are leaving an age of bundled, curated video content and entering an age of self-selected, self-curated content.

The unbundling of cable, the decision of millions to go “over the top” and choose instead to get their entertainment directly from the Internet, is one of the great sea changes of this decade, driven by rising costs and (perhaps more important) a shortage of time. Lost may be serendipity, the decision to watch things because they are on.

Today, for instance, I watched George Englund’s The Shoes of the Fisherman, a 1968 MGM film in which Anthony Quinn plays a radical cross between Pope John Paul II and Pope Francis, renouncing communism and wealth at the same time in the name of secular decency. Given that it was made early in the pontificate of Paul VI (John Gielgud gets one scene playing a nice version of Paul, then dies to make way for the plot) it is many decades ahead of its time. (Quinn’s character is even proclaimed a cardinal from Lvov, which is in western Ukraine, and a starving China drives the plot.) But it’s not what I would be watching if I had the whole world to choose from.

Days of Apps

Think of this as Volume 16, Number 28 of A-Clue.com, the online newsletter I've written since 1997. Enjoy.

---

In 2012 the software industry is like an iceberg. Most of it is under the water.

Not underwater, mind you. Under the water.

That's because the world of “applications” is over. It's all about the apps now, brutha. And no one in the app business has yet gone public. The smart VC guys and private equity people are putting tons of money into the space, so there's no need to go public, no need to give the public investor a taste.

It's like the social boom. You'll know the bust has started when one of these outfits starts looking for suckers on NASDAQ.

Doesn't mean there's no there, there. There is. I found that out Monday when I went to a “MeetUp” for Techcrunch.com at the Sweetwater Brewery, a few miles from my home.

The place was packed. Cars were parked around the corner and down the next street. (They could do it because this is a warehouse district where everyone else goes home around 5 PM.) There were well over 3,000 people there. Mostly male, mostly young, mostly white. But not exclusively. I was also pleased to find two people who rode bikes there. A guy my own age who admitted he'd taken the train to a nearby transit stop, and a younger guy who'd ridden 8 miles in rush-hour traffic. 

Tomorrow's News Today: Google Chromebook #Fail

When I traveled to China in 2009 I had an HP Netbook with me.

It was a failure. It only had 2 Gigabytes of internal storage, which within a few months wasn't even enough to run Windows (which updates constantly). I bought a 32 Gbyte stick for it, but as that wasn't the primary drive Windows never recognized its full capacity.

Now Google has, through Samsung and Acer, introduced Chromebooks that solve all those problems.  And they, too, have Fail written all over them. 

The problem is not the operating system, or the dependence on online updating. (Ostatic seems to have a problem with that). The hardware itself is first-rate, with 32 Gigabytes of chip memory inside the box and a Linux that won't swallow it all, leaving plenty of room for applications.

The problem is the basic design.

The Big Opportunity in Home Servers

A lot of people are writing today that Apple has killed the home PC  with its iCloud and iOS announcements.

They haven't. The PC has been dieing for years. As a client.

But as a server? Not so much.

I know that the long-term talk about “media servers”  has proven to be a dead end. I'm talking about an opportunity that has existed for nearly a decade, which I first began labeling “the world of always-on.”

I'm talking of single-chip, specialty devices that can provide automation, security, inventory and medical services to our aging population.

• Devices placed in-line with lights, kitchen appliances, and any other system which uses energy, which can monitor the conditions of those devices, turning them on-and-off in response to a program.

• Single-chip cameras that can be turned on remotely, or via a program, to provide constant security.

• RFID chips placed on goods and even foodstuffs that can monitor the inventory and location of what you got.

• Medical devices that can monitor and report on health without outside intervention.

What Should Microsoft Do Now?

For some reason – maybe it's the fact that Microsoft now sells at the P/E of a medium-sized bank – the company is getting all sorts of advice.

Some of the dumbest advice comes from ReadWriteWeb, which thinks Microsoft Needs to Open Source Something Big But What?

Wrong question. Open source is not some magic elixir. It's a specific tool with a specific purpose. When you want collaboration you offer up the code. In the mid-2000s, this meant code you just wanted to shove over the side. More recently it's been important projects you needed others to commit to in order for them to succeed.

After the Carrier Death Spiral, Google

A “carrier death spiral” is what some are calling AT&T's acquisition of T-Mobile. (Others disagree.)

The merger raises the spectre of a renewed monopoly (as though the former SBC hadn't moved decisively in that direction years ago). The deal will take a year to clear although AT&T officials insist they have the stroke with the bureaucracy to get it done.

And they do. That's the problem.

I can't tell you how many trillions of dollars American consumers have paid over the last decades, over and above their real value, for wired and wireless bits, thanks to monopolistic practices we foresaw in the mid-1990s, tried to deal with, and then saw politics unravel.

The whole idea of the government, from the beginning, was to separate the infrastructure from the service. Thanks to a compliant Bush Administration, and Clinton appointees who were outmaneuvered, the Bell operating companies overthrew that deal. This led to the merger mania which now sees us with only three “choices” – AT&T, Verizon and Comcast – for most people just two of the three, and for others just one.

The Unstoppable Power of Communication

The most powerful force in the world is communication.

This medium brings more of it within reach of more people than any medium has before. (Pictured, the capital of Rwanda.)

When George W. Bush was in Africa this week reporters were astounded by the number of people there who supported Barack Obama, who seemed to know all about him.

And why not? Africa is filled with Internet cafes. Africans don't have to listen hopefully for a word from the BBC anymore. They can pick up The New York Times.

Recently I mentioned the idea that Obama should go to Kenya and try to sort out the growing crisis there. Turns out he's been there, via radio. He made a statement and took questions at the end of last month. This has not yet had an impact, as the struggle has morphed into a tribe-on-tribe war over land. But he was there, and could be again, at any time.

It's not just politics where this medium is making enormous change. It's in every facet of life. The turnaround in Rwanda is being driven as much by information as anything else. The use of sympathy to reach markets, and the opening of an online stock exchange,  is enabling capital to reach all of East Africa. Trouble in Kenya can now quickly move capital to Rwanda and vice versa. Rapid capital flows can create a gigantic incentive to make peace.

This Week's Clue: Liberate Moore's Law

Following is the essay you can designate as Volume 10, Number 48 of This Week's Clue, based on the e-mail newsletter I have produced since March, 1997. It would be the issue of December 3.

Enjoy.

---

When this newsletter launched in 1997 it was called A Clue...to Internet Commerce.

As Internet Commerce became commerce, and as the process of doing business online became standardized, I began looking at other areas to cover and settled upon Moore's Law.

At the start of this decade Moore's Law was racing along on every front, and it seemed there was no way to stop it. So I wrote in my 2002 book. (That's it to the right. The beard is whiter now, but I still have the suit and it fits.)
 

I was wrong. There was a force that could stop many elements of Moore's Law in their tracks.

Politics.

The Biggest Lie in Technology

It's a lie that makes my blood boil every time I read it. (This cartoon, by Thomas Nast, is over 110 years old.)

The lie is that the U.S. telecommunications market is competitive, even hyper-competitive.

That lie was told again this week, by the Walt Disney Internet Group, when it announced its MVNO, a re-sale agreement with Sprint, would be closing. (The idiot in charge was engaging in some serious ass-covering.)

This followed similar announcements by Amp'D Mobile and by ESPN, another Disney unit. The only successful MVNO in the U.S. is Virgin Mobile, which is trying to go public in order to pay down its bills.

The plain fact is that the U.S. communications market, wired and wireless, phone, cable and Internet, is an oligopoly with very few participants, and that U.S. consumers have either few or no choices.