Mario Fantoni's Blog

TV Is Dead. Long Live The Internet.

Where did Wikipedia come from? All those hours, all that work. Where did the time and effort come from? It comes from the TV we're not watching.

Take a look at Netroidcomics (NSFW). Sure, some of these folks were at work, goofing off, but the real influx of time and energy we're seeing online comes from TV. Three, four or even six hours a day not spent doing virtually nothing. Multiply it by 2.2 billion people online and suddenly, there's a huge influx of hours just waiting to be put to good use.

I don't watch TV and I don't go to meetings. You'd be amazed at the difference it makes.

While the last few years have been devoted to mostly trivial pursuits, I would imagine we're going to see a rapid acceleration in the quality and meaning of things we manage to create with our new-found time. At least I hope so.

Day Old Sushi...Yuck!

I am not making this up. As the photo on the left attests, a profit-minded entrepreneur is trying very hard to make ends meet. The problem with this strategy is obvious. It sends the anti-sushi message. Hey, we're not fresh. We don't even care so much about fresh.

If I ran a quickserv sushi place, I'd write the time the product was created on every single box and would offer a local shelter anything that was more than 60 minutes old. The money they make selling the old sushi can't possibly make up for the horror the full-price customers feel.

Easy Mony

A couple of weeks ago I decided to buy a treadmill (new year's resolution...) so I checked Craigslist. The problem was that I searched for "threadmill" by mistake and found only a used NordicTrack C2155 for $185 (MSRP $1,199). I found it very strange that only one person was selling a treadmill in the whole Sacramento area, but I called the seller (a Philippine lady that did the same typo I did, of course) and arranged to buy the "threadmill." I have it in my exercise room. Last week I realized my mistake and searched Craigslist for "treadmill" and found 133 for sale. I then looked for "NordicTrack C2155" and found 13 for sale, from $350 to $500. Bottomline: my typo saved me between 40 and 60% of the cost.  I am sure is possible to make money on Craigslist or eBay using typos, like buying "threadmills" and selling "treadmills."

Hollywood vs. Piracy: Surprise, Surprise

In a paper titled ‘Reel Piracy: The Effect of Online Film Piracy on International Box Office Sales’ researchers from the University of Minnesota and Wellesley College examined the link between BitTorrent piracy and box office returns. Contrary to what’s often claimed by the movie industry, the researchers conclude that there is no evidence that BitTorrent piracy hurts box office returns.

With their unconditional support for SOPA, PIPA and ACTA, Hollywood is pressing hard for new legislation to curb piracy. The studios want ‘rogue’ websites to be censored and are calling on Google and Internet providers to take responsibility. However, the study reveals that movie industry itself has the key to decreasing piracy, without passing any news laws. “We find that longer release windows are associated with decreased box office returns, even after controlling for film and country fixed effects."

The above means that movie "pirates" wouldn’t have bought a ticket at the box office if file-sharing was nonexistent. Yet, the movie industry lobbyists keep hammering on about eliminating "pirate" sites, while ignoring the fact that the industry itself can make important steps to decrease piracy as well. Governments around the world are not blind to this double standard, as both the Netherlands and Switzerland chose to keep unauthorized movie downloading legal until the industry improves the availability of legitimate content.

Of course the study is far from perfect as there are many more factors that influence box office returns. However, the findings clearly indicate that the movie industry itself must take the biggest step towards eliminating piracy “losses,” not lawmakers.

9 Things That Will Disappear In Our Lifetime

 

1. The Post Office
Get ready to imagine a world without the post office. They are so deeply in financial trouble that there is probably no way to sustain it long term. Email, Fed Ex, and UPS have just about wiped out the minimum revenue needed to keep the post office alive. Most of your mail every day is junk mail and bills.

2. The Check
Britain is already laying the groundwork to do away with check by 2018. It costs the financial system billions of dollars a year to process checks. Plastic cards and online transactions will lead to the eventual demise of the cheque. This plays right into the death of the post office. If you never paid your bills by mail and never received them by mail, the post office would absolutely go out of business.

3. The Newspaper
The younger generation simply doesn't read the newspaper. They certainly don't subscribe to a daily delivered print edition. That may go the way of the milkman and the laundry man. As for reading the paper online, get ready to pay for it. The rise in mobile Internet devices and e-readers has caused all the newspaper and magazine publishers to form an alliance. They have met with Apple, Amazon, and the major cell phone companies to develop a model for paid subscription services.

4. The Book
You say you will never give up the physical book that you hold in your hand and turn the literal pages. I said the same thing about downloading music from iTunes. I wanted my hard copy CD. But I quickly changed my mind when I discovered that I could get albums for half the price without ever leaving home to get the latest music. The same thing will happen with books. You can browse a bookstore online and even read a preview chapter before you buy. And the price is less than half that of a real book. And think of the convenience! Once you start flicking your fingers on the screen instead of the book, you find that you are lost in the story, can't wait to see what happens next, and you forget that you're holding a gadget instead of a book.

5. The Land Line Telephone
Unless you have a large family and make a lot of local calls, you don't need it anymore. Most people keep it simply because they've always had it. But you are paying double charges for that extra service. All the cell phone companies will let you call customers using the same cell provider for no charge against your minutes

6. Music As We Know It
The music industry is dying a slow death. Not just because of illegal downloading. It's the lack of innovative new music being given a chance to get to the people who would like to hear it. Greed and corruption is the problem. The record labels and the radio conglomerates are simply self-destructing. Over 40% of the music purchased today is "catalogue items," meaning traditional music that the public is familiar with. Older established artists. This is also true on the live concert circuit. To explore this fascinating and disturbing topic further, check out the book, "Appetite for Self-Destruction" by Steve Knopper, and the video documentary, "Before the Music Dies."

7. Television
Revenues to the networks are down dramatically. Not just because of the economy. People are watching TV and movies streamed from their computers. And they're playing games and doing lots of other things that take up the time that used to be spent watching TV. Prime time shows have degenerated down to lower than the lowest common denominator. Cable rates are skyrocketing and commercials run about every 4 minutes and 30 seconds. I say good riddance to most of it. It's time for the cable companies to be put out of our misery. Let the people choose what they want to watch online and through Netflix.

8. Local Storage
Many of the very possessions that we used to own now reside in "the cloud." Today your computer has a hard drive and you store your pictures, music, movies, and documents. Your software is on a CD or DVD, and you can always re-install it if need be. But all of that is changing. Apple, Microsoft, and Google are all finishing up their latest "cloud services." That means that when you turn on a computer, the Internet will be built into the operating system. So, Windows, Google, and the Mac OS will be tied straight into the Internet. If you click an icon, it will open something in the Internet cloud. If you save something, it will be saved to the cloud. And you may pay a monthly subscription fee to the cloud provider. In this virtual world, you can access your music or your books, or your whatever from any laptop or handheld device.

9. Privacy
If there ever was a concept that we can look back on nostalgically, it would be privacy. That's gone. It's been gone for a long time anyway. There are cameras on the street, in most of the buildings, and even built into your computer and cell phone. But you can be sure that 24/7, "They" know who you are and where you are, right down to the GPS coordinates, and the Google Street View. If you buy something, your habit is put into a zillion profiles, and your ads will change to reflect those habits. "They" will try to get you to buy something else. Again and again.

All we will have left that can't be changed are memories.

Google+: Can't Live With It, Can't Live Without It

 

Google and Facebook are both trying to gather as big a user base as possible, in order to exploit those users' identities and make lots of money in the process. Google's integration of Google+ into its core search service should dispel any illusions that the company's social platform will die the death of its predecessors. Yes, Google+ currently feels like a nerd sanctuary, and yes, the company screwed up previous social efforts such as Wave and Buzz, but Google is deadly serious about this one. Wave and Buzz were experimental. If Google+ were to fail, it would now take — at the very least — a huge chunk of Google's reputation with it. The only way in which this could be avoided is if people loathe Google+ so much that they actively disable it en masse for their Android phones, Google Search and the rest — if that happens, then Google could ditch it and few would notice. People are generally apathetic about such things, so that won't happen. 

So what does this move do for Google? The company is already king of the search world, with an 80 percent global market share. This move is unlikely to increase its share, as search, rather than Google+, remains the driver here. It may create a unique-enough experience to fend off Bing, which people are starting to realize is a decent alternative, but then again it could send people Bing's way if it skews results to too great a degree. But Bing and the Bing-powered Yahoo search collectively have around nine percent market share. Baidu has ten percent, but that's mostly a China-specific service. Google's position in the search market is not seriously under threat.

The real rival here, of course, is Facebook. And the funny thing is, despite the fact that Google+ and Facebook are both social networks, I'm not even sure that characteristic is in itself the battleground. You know that annoying thing when you install a new browser or service and the damn thing keeps trying to get you to change your homepage? That's what this war is about.  The two companies are coming at it from different sides, of course. Facebook started with social networking and is now using platform-specific apps to make sure people who want to follow a shared link don't have to leave Faceland to do so. Google, being first and foremost a search company, is coming at it from the other side. While iGoogle has its uses, it is too cluttered a portal, so Google is using the social element to keep its search engine the de facto entry point and standard browsing launchpad. It's a defensive maneuver, but it may work.

As for you and me, the users, it can at least be said that we don't have to put up with 'Search plus Your World' if we don't want to. I would certainly advise those who already grumble about Google's results-tailoring cookies to toggle the new service off.

And I'd also advise people to stop predicting Google+'s imminent demise. It could happen, but don't hold your breath.

Siri Doesn't Like Planned Parenthood

I don’t think Apple really wants to keep its customers from finding abortion services using Siri, the voice-based automated assistant built into iPhone 4S’s. Has been more than a month since the problem was reported on CNN, and Apple has been remarkably obtuse on the issue, making statements that deny intent, deny culpability, yet at the same time seem evasive. It’s time for Cupertino to learn a lesson in damage control.

Visit any Apple store and you’ll see it. Those Apple kids in their t-shirts are friendly and helpful and good at their jobs but don’t you get the sense that they’re drunk on Apple-Aid? They know what they can and can’t, will and won’t do for you and for all the tattoos and Converse sneakers they aren’t going to go a millimeter over that line. And then there’s their sense of time — AppleTime — which is different from yours and mine, have you noticed? They live in the zone, while we’re just visiting. This is fine when things are going beautifully and customers are lined-up down the block, but how well does it work when things aren’t going right, like in this Siri situation?  Badly. 

Apple comes off looking insensitive and smug. They blamed the problem on Yelp, its supplier of local business data, which could well be correct, but Apple never said "and we’ll fix it right away." Then they blamed the problem on Siri being in beta. I didn’t know that, did you?  Siri is part of IOS 5, is that in beta?  I didn’t know that and I suspect most of the folks at Apple didn’t know that.  In fact I might even go so far as to wonder if it is even true? Blaming beta software for bad performance is Google’s bag, not Apple’s.  That was a stupid PR move and stupid PR moves happen when companies panic. Which suggests a leadership vacuum of sorts at Apple. With Steve Jobs gone, the company has told itself and told the world that it won’t try to second-guess Steve’s ghost — no asking “what would Steve do?” But what happens if they don’t have a ready answer to the question “What should Apple do?” I think that’s what we are seeing here.

Ironically Apple appears to have fallen into this very abyss. They are so caught up in their own process of information and damage control that the actual problem with Siri doesn’t appear to matter to them. Their statements suggest things will improve soon. This is an example of AppleTime. Why should it take that long to fix?  It shouldn’t and it won’t, but Apple appears to not want to empower us by communicating honestly.  They want to surprise us by fixing it yet don’t respect us enough to explain the plan.

Their first thought is to dissemble, not to accept responsibility. They seem to think solely about how this abortion incident could hurt them, not how it could be a chance to show Apple’s character — a chance to have character. Everyone appears to be too busy to try to actually fix the problem. Maybe after 16 years Steve forgot his own lesson, but I’m guessing that if he read this post he’d get it right away. And Steve would learn from it, because he was one guy who wasn’t afraid to admit when he was wrong.

My First Donation to Wikipedia

How many times on Wednesday did you do a web search that led you to a Wikipedia page that then didn’t load because of that site’s SOPA protest?  I didn’t notice the effect immediately but once I did I was later able to go back through my browser history and see that I tried and failed to open a total of 13 Wikipedia pages.  Whether you give a damn about SOPA or public protest, this experience has given me a whole new respect for the role Wikipedia has come to play in my life and probably yours. As a result I made a small donation to Wikipedia around lunchtime then was frustrated the rest of the day for not being able to access it.

As for the SOPA/PIPA protest itself, I sympathize. But in my view what we have here is mainly a conflict of business models, dying industries, and really, really poor design that will work itself out over time. Remember the record album — the vynil LP?  Some were great, most were not. Too many B tracks if you ask me. The music industry has long had a problem of value.  The groups I liked sometimes didn’t have many good songs.  The record companies would put one or two good songs on an LP or CD, then throw in 10 more that weren’t so good.  All we wanted were good songs at a reasonable price, which didn’t mean the 15-20 percent yield we were getting from albums.

Then came iTunes and all those problems went away.  iTunes did more than just sell the songs the record companies were pushing: they sold whole collections of music.  As a result, more, not less, music was sold, most of it the good stuff. Music — if not the recording industry — is better as a result. Steve Jobs proved thinking about the consumer is very good business.

Now we have SOPA and PIPA.  I would like to have the same ability to build an online movie library as I have done with music, but there are big problems with this, starting with Windows Media Center and, yes, even iTunes — pretty good products in their own right that protect the copyrights of stored content.  That part is okay.  But they have very little third party support.  Then there is the problem of content.  I can buy only a fraction of what I’d like to get and it is scattered over several suppliers.  If the movie and TV industries think I am going to subscribe to 5-10 services for $10-25 a month each, they’re nuts.

The movie and TV industries are doing now exactly what the recording industry did before iTunes.  SOPA and PIPA will die but they’ll be replaced with something just as bad because politicians need votes and producers are afraid of the future — a future that’s coming no matter what the entertainment industry does.  For the money they are spending on lobbying, a design team could develop a new system that would make more money by exposing more content, not less, enabling new business models in the process.  At least that’s my take on it.

Why PIPA and SOPA Suck

In case you haven’t heard, PIPA (PROTECT Intellectual Property Act) and SOPA (Stop Online Piracy Act) are bills working their way through the US Senate and House of Representatives, respectively.  They both propose giving the government the power to censor web sites in much the same way that China, North Korea, and Iran censor web sites today.

What? How can this be, you ask. This is America, land of free speech and due process, which are both kind of fundamental to the whole American dream thing. And yet, it’s true. If PIPA/SOPA pass in anything resembling their current form, it will have a chilling effect on Internet free speech. Here’s why:

1. The bills hold websites accountable for content posted by their users

The bills essentially do away with the safe harbor provision of the Digital Millennium Copyright Act, the current US law protecting copyrighted material on the Internet. Under the DMCA safe harbor, sites like YouTube and Facebook are not responsible for the content posted by their users as long as they take down copyrighted material when they are made aware of it. As it stands today, if someone posts on YouTube a bootleg copy of Rob Schneider’s 1999 opus “Deuce Bigelow: Male Gigolo,” YouTube cannot be put out of business as long as it has a reasonable process for taking down the infringing content. Passing PIPA and SOPA will change this.

2. PIPA and SOPA would let the government compel other companies to stop doing business with or linking to offending sites

The bills would allow the government to order ISPs to shut down web sites like YouTube and Facebook that it finds have violated copyright laws by distributing or allowing their users to distribute protected content illegally. For sites outside the US jurisdiction, the bills allow the government to force DNS providers to stop resolving offending domain names, force search providers to stop returning links to offending sites, and force advertisers to sever relationships with offending businesses. 

3. The bills fail to consider the true costs of compliance

Specifically, the bills fail to consider: the technical feasibility of compliance, the  burden that compliance would place on companies, the potential damage done by errant takedown orders, and the impact that these acts might have on the underpinnings of the Internet itself. For example, if offending sites are removed from search engines, the DNS, and other directories, it would create “black holes” in the Internet.

No one is arguing in favor of copyright infringement. Such actions are clearly illegal and wrong. But the DMCA and other copyright laws provide ample protection and remedies designed to compensate copyright holders and bring copyright violators to justice. Chilling free speech on the Internet, imposing undue economic and technical burdens on non-infringing companies, inviting international tit-for-tat web site blocking, and involving the technologies and systems underlying everyone’s Internet experience in a legal tug-of-war to eradicate copyright infringement is a terrible idea.

Why Big Companies Abhor Change

There’s a great TED Talk by Simon Sinek about how great leaders inspire companies by asking "why?"  I think it also goes a long way toward explaining why big companies don’t handle change well.  It’s not that they can’t ask "why?", it’s that the answer doesn’t make sense at their scale, though it should. Times change and big companies don’t like to change with the times.

At the opposite end from big industrial companies sit startups, nearly every one of which begins with an effortless expression of "why?"  Big companies ask "what?" then "how?" but almost never "why?" according to Sinek, who I think has it absolutely right. But good startups are motivated from birth by "why?" Nearly every good startup begins with "why?" and that"why?" is traditionally quite simple — because the founders want one for themselves. A hardware device or software application doesn’t exist and they’d really like one, so they invent it. For startups "why" is easy. If it isn’t easy then you probably don’t have a good startup. If as a founder your answer to "why?" is “to get rich” you are in the wrong job. Applied to a more mature company, looking at Apple we can see the why of the iPod and iTunes was “to take your entire music collection with you wherever you go.” That sort of thinking isn’t common in big companies. Some of this is due to scale, some due to arrogance, and some to simply losing their way.  But no matter how big a company grows, asking "why?" is still vital for continued success. They just don’t know it.

Back in 1986 Adobe launched Illustrator, Adobe’s first consumer product. The "why?" for Illustrator was “because (Adobe founder) John Warnock wants a drawing program,” which is a classic startup reason. The business plan had the new consumer division with a net-net positive cash position of $87,000 after five years. Millions invested creating an entire new business for a new set of customers through a completely new distribution channel for a lousy $87,000? Most companies would never have done it. Yet if you look at Adobe’s market cap of $13 billion today probably 90% of that is based on consumer and professional software that began with Illustrator. That $87,000 grew to $13 billion over 25 years.

Adobe was lucky to have a curious founder still at the helm. It was lucky to be making enough money to risk a few million on an alternate future, too. But 2011 is nothing like 1986. Looking five years ahead for business justification isn’t done any more because five quarters is a long time in business today.  But then the average CEO tenure is also four years, so what? And that’s why big successful companies roll over and die.