Wall Street Journal: Schering-Plough, generic firms face FTC suit over illegal payments. The move is the latest in a widening drug war by the FTC, which alleges that a number of major pharmaceutical companies have paid off smaller rivals to delay generic competition.
ICANN and Verisign, an Unholy Alliance
Reuters: Lawmakers ask for review of ICANN-VeriSign deal. “Without taking a position on the propriety of the revised agreement, we want to ensure that any actions by ICANN support and encourage strong, vibrant competition,” the letter said.
OK, I’ll take a position. The ICANN-Verisign deal smells to high heaven.Verisign’s Network Solutions unit is in a class almost by itself as an arrogant, monopolistic enterprise that throws its weight around like the proverbial 800-pound gorilla. Except in NSI’s case, this gorilla is just plain mean.
This deal, put together after secret talks, effectively lets NSI maintain its status — and maybe strengthen it. Now there will be a secret vote by ICANN’s board.
Until Congress started asking questions, the ICANN vote was a foregone conclusion. Now, maybe, this train will slow down just a little.
Backing the Net
One of the most ridiculous initiatives I’ve seen in a long time is the “Back the Net”, propounded by Michael H. Tchong, who edits and runs the Iconocast online newsletter.
Tchong thinks the Net economy has fallen because of a “viral lack of confidence” about all things cyberspace. There’s a good reason for this lack of confidence. Investors got screwed, royally, and they’re understandably leery now.
They got screwd by a daisy chain of a) entrepreneurs who didn’t care about anything but their “liquidity events”; b) venture capitalists who funded absolute junk, knowing they could cash out; c) investment bankers who took these garbage companies public and raked in huge fees; d) the shill analysts at the banks who pumped the lousy stocks; e) stock brokers who sold garbage to retail investors; f) greedy investors. The media played a role with credulous coverage.
Tchong’s solution is ridiculous. Don’t buy things just because they’re online. Buy them because you need them. Period.
England’s Progress Toward E-Government
The British government has earned a poor reputation among civil libertarians and privacy advocates worldwide for its desire to maintain pervasive surveillance on electronic communications. But the regime’s attention to cyberspace is also having a positive effect — rapid progress toward putting government services online.
Among recent moves is a Web site called UK online. It’s a start on what the United Kingdom’s “e-Envoy,” Andrew Pinder, calls a determination to make the nation “the No. 1 place to do e-business in the world.”
UK online is a gateway to information services. Its pages offer a wide variety of information, and entry points to government systems such as the tax authorities. The idea in the latter case is to make it possible for British citizens and businesses to be able to handle all of their dealings with the government electronically.
By 2005, Pinder said in an interview Thursday during a brief visit to Silicon Valley, the government should be electronically accessible in every possible way.
He also said the system has an open technology architecture, so third parties can offer value-added services to consumers and businesses. The government also is planning to create a joint venture with Microsoft to sell this kind of system to other governments that are not as far along in creating e-government operations.
Jeff Bezos’ Amazon.com continues to be under pressure from investors and observers of the e-marketplace, but Bezos professes utter confidence in his company and its future.
I caught up with him yesterday at the PC Forum conference. He was grinning, as usual.
“Why am I so optimistic?” he asked rhetorically, reflecting the topic he was about to address in a talk to the conference audience. “Why in the world is this man still laughing?”
Easy, he answered. Electronic commerce just makes too much sense to dismiss, and the big trends are all in favor of e-commerce’s continued rise.
“We trade real estate for technology,” Bezos said. “Real estate gets more expensive every year and technology gets cheaper every year.”
In half a decade or so, when bandwidth is many times greater to people’s homes than it is today, the change in the customer’s online experience will be so great that we will scarcely recognize it. Real estate, meanwhile, isn’t going to follow Moore’s Law.
Why be optimistic about Amazon? That’s also easy, Bezos insists. “We’re the leader in that space.”
The company’s fundamentals are better today, when its stock has crashed, than they were when the stock was at its ridiculous peak in the Internet bubble, according to Bezos. “We are uniquely positioned,” he says.
Maybe. I don’t disagree that Wall Street’s assessment of many stocks today is equally irrational on the negative side as it was on the positive side a year ago. But there are an awful lot of questions about Amazon’s future that Bezos hasn’t answered. Even the patsy Wall Street analyst community, which used to praise all things Internet with little due diligence, is demanding more useful information from the company.
By the way, Bezos wouldn’t answer when I asked him if Amazon has filed for a patent on its “Honor System” service, an online payment system. If he hasn’t, I’d be amazed.
Garry Betty runs one of the largest Internet companies around: Earthlink, a leading Internet service provider.
His product isn’t free. His 4.7 million subscribers spend at least $20 a month, and many are willing to pay even more.
But Earthlink, which has grown through acquisitions and relentless marketing, still faces giants on all sides.
Over here is America Online, the overwhelmingly dominant online provider and now a major producer and marketer of entertainment and information. Over there are the local telephone and cable monopolies, which tend to think that competition is something for other companies.
Yet Betty seemed to be in a mood as sunny as the Arizona day here at the annual PC Forum conference when he talked about his plans for Earthlink. The Atlanta-based company may be a distant second to AOL in number of subscribers, but it’s way ahead of everyone else — and Betty and his team have huge plans.
Think broadband, he said over lunch at PC Forum. And think broadly about broadband.
That’s easy to say, but Earthlink is dealing with companies that, for the most part, don’t care much for competing. The local phone companies continue to throw roadblocks in front of competitors in the digital subscriber line (DSL) market. The cable companies haven’t gone out of their way to open access to third parties, either.
But Earthlink has been making deals with the cable crowd — including an agreement, announced Tuesday, to conduct technical trials that could lead to Earthlink offering service on Comcast’s cable systems. It’s slogging ahead in the DSL marketplace, and it’s looking to offer satellite and other wireless op
tions.
“We’re going to grow broadband aggressively,” he said, “and we’re agnostic as to transport.”
It also wants to be neutral about the devices customers use to get information. Betty says Earthlink will be rolling out services that help customers retrieve e-mail and other information from a variety of devices from pagers to phones to handheld computers. Mail will arrive formatted for the specific device, and customers will have considerable control over whose messages get through, and when.
BY THE WAY:Joel Spolsky got some junk mail from Earthlink that raised his ire. I’ve asked Earthlink to respond.
More Views of HailStorm
The Scam Artists and the Energy Crisis
Here come the sleazeballs who want to take advantage of the higher prices and shorter supplies of various kinds of fuels. Some of the come-ons are arriving in e-mail, including an offer this morning for a $20 video tape explaining a program I could join to get free power forever.
Here are some of the headlines from the e-mail:
Announcing a bold new program that might provide permanentFree Electricity for Homeowners !
Economic windfall!
Energy Independence!
Zero Emissions!
End of Wars over Oil!
You get the idea! It’s bogus!
Don’t fall for things like this!!!!!
Esther Dyson and her crew always get startups to show their stuff at this conference. My favorite of the batch this year is Antarcti.ca Systems, a Vancouver-based company that’s creating cool visual representations of data.
Tim Bray, the company’s founder and CEO, is also known as a co-inventor of XML, the Extensible Markup Language that’s creating such a stir in the technology industry these days. He took me through a sample of Antarcti.ca’s work, a map of the Internet.
Keep in mind that the Web map isn’t Antarcti.ca’s product. The company wants to license its “Visual Net” framework that lets business create other kinds of visual representations of large sets of data.
Visual Net, says Bray, “takes a complicated, shared data space and puts a GUI in front of it.”
Starting from an image of the Antarctic continent, Bray and his colleagues have mapped the category structure of the Web. The data comes from the Open Directory, a project that relies on volunteers who are trying to create the world’s largest and most useful hierarchical directory of Web sites.
You can get a 2-D or 3-D image. I strongly prefer the 2-D one, because I find it more useful than the three-dimensional representation. Either way, what you get is a diagrammed view of the Web that can be useful to look around and see some relationships.
The Sum of All Knowledge
Interesting notion hit the floor at the PC Forum conference this morning. Graham Spencer and Joe Kraus showed how computing power is increasing at such a rate that things we copyright when created in the analog world, such as a poem, could be created by computers crunching numbers at a rate equivalent to the old saw of enough monkeys writing Shakespeare, given enough time, simply by making random punches on typewriter keys.
That idea has implications for copyright, needless to say. I’m still working this through, but it’s pretty provocative.
Now That’s a Rate Hike
Maybe the Public Service Board members had a spy in the room Monday night when Steve Kirsch, the serial entrepreneur whose current startup is Propel, got up and raised hell about the California energy situation. Given the massive rate hike approved on Tuesday, Kirsch must be pleased.
Among other things, he urged raising rates to get the utilities back onto solid financial footing. He also said Gov. Gray Davis should forget about a solution that makes everyone happy. Can’t do it, said Kirsch. Government action to push real conservation wasn’t one of this points, an odd omission in my book.
The PC Forum conference, which got under way in suburban Phoenix today, is once again shaping up as one of the most interesting events of its kind. Esther Dyson and her colleagues have gathered a terrific list of panelists, and already we’ve heard some challenging discussions.
The organizers have also pulled together an interesting group of new companies. I stopped by presentations this afternoon by Voxeo, which is trying to pull together the phone and the Web with an applications-building platform that looks quite cool, and ActiveBuddy, which is using buddy lists as a platform.
The idea with ActiveBuddy sounds innovative. It combines back-end scripting and servers to create services that companies can deliver to instant-messaging clients. There’s some real potential here — both for customers looking for information and companies that want to provide it. And as ActiveBuddy’s CEO, Peter Levitan, noted, the IM list is tantalyzing real estate.
California’s Electric Rate Increase
AP: State power regulator proposes 40% rate increase.
Gee, what a shock.
I’m always amazed at how many people seem to believe everything they read. The fact that scam artists get away with their tricks is evidence. So are the myriad myths zooming around the Internet every day.
Even if cyberspace isn’t all that much different from the real world, it does seem as though we need to learn some new rules. More in my Sunday column.
Surprise: Bush is a Right-Winger
Washington Post: Bush Team Has ‘Right’ Credentials. President Bush is quietly building the most conservative administration in modern times, surpassing even Ronald Reagan in the ideological commitment of his appointments, White House officials and prominent conservatives say.
I am beginning to respect Bush’s ability. He’s at least as good a liar as Bill Clinton, and maybe a better politician.During the campaign, Bush called himself a “compassionate conservative” — an ink blot of a claim that was intended to be whatever the voter wanted it to be. Now that he’s in office, however, Bush is showing his true colors.
Bush has already repaid the coal lobby in spades by tossing overboard his campaign support for measures to slow global warming, and his EPA killed rules to lower arsenic in water. Bush appointed the most reactionary attorney general in recent history, John Ashcroft. Bush and his congressional buddies have tossed
overboard new rules designed to protect workers from on-the-job injuries.Bush ended a policy (New York Times), dating back to Eisenhower, in which the American Bar Association vetted potential judicial appointees. Ideology now rules, and the federal judiciary will be full of people like Antonin Scalia and Clarence Thomas, whose radical activism would have the right wing screaming if they were liberals. Bush is supporting new restrictions on abortion, and thwarting congressional attempts to stop his actions. And so on. George W. Bush is only a conservative in the current, hard-line sense of a once-meaningful word that’s been hijacked and perverted by the hardline right wing of the Republican Party. Bush is a radical right-winger, and he’s going to transform the government — and America — if he can get away with it.
It’ll be easier than anyone might have imagined. He’s up against political opponents who have utterly lost their spines. The Democrats are abject cowards, based on their record so far this year.
The Silicon Valley tech moguls who supported Bush pretended he was a new kind of Republican. They were lying, too, or they didn’t want to know the truth. Either way, they should be asking themselves whether they got more than they bargained for in this president.
The person in this nation who should be most ashamed is the person least likely to understand the concept. The egomanic Ralph Nader, who deliberately threw the race to Bush, also lied through his teeth when he claimed there would be no serious difference between a Bush and Gore presidency.
But give Bush his due. He’s seen the vacuum the Democratic patsies are leaving in the political scene, and he’s filling it as fast as he can. He’s no amateur, after all.
New Scientist: It’s Over. The Mir space station plunges into the Pacific Ocean – the end of a glittering space era for Russia.
The passage of the Mir station into history should resonate with those of us who believe that humanity is destined to break the bonds of this planet, sooner or later. It’s looking more like later as space exploration meets budgetary constraints and our amazing lack of imagination.We need to redouble, not slow, our move into space. The risks of doing otherwise are huge. Maybe an asteroid won’t create a catastrophe someday, and maybe some virus — from nature or a laboratory — won’t wipe out the species.
But the classic admonition, that you shouldn’t put all eggs in one basket, is never more true than in this situation. We’ve been bound to this planet by our own primitive nature until now. It’s time to grow up, and out.
Mir’s contributions to humanity’s space exploration were enormous. We all owe the people who funded and operated this platform our thanks.
Richard Li, Stanford Dropout
In November 1999 I wrote a column about Richard Li, executive chairman of Pacific Century CyberWorks, a company that got rich on inflated Hong Kong stock prices and ended up buying the territory’s biggest telephone company. In that column I said, based on information provided by PCCW, that Li was a graduate of Stanford University.
He isn’t, as he admitted when the International Herald Tribune started asking pointed questions several days ago. He claims he never personally lied about this. Maybe that’s true.
I’m chagrined, to put it mildly. I made an error by reporting something that I hadn’t absolutely verified.
But PCCW’s statements about the matter have been beyond astonishing. The first one, which I received yesterday, said:
To end further media speculation, Mr. Richard Li, PCCW’s Executive Chairman, wishes to make public the status of his studies at Stanford University. Mr. Li attended Stanford for more than three years from 1984 to 1987, but left before completing his degree, for personal reasons. In some isolated instances, Company public relations materials have been produced that inaccurately reported Mr. Li had graduated from the university. Mr. Li has instructed the Company to act immediately to correct any inaccuracies in these materials and on its public web site. The Company emphasizes that this inaccuracy did not appear in public disclosures filed by the Company in accordance with applicable legal requirements.
The second, arriving today, said:
Following Mr. Richard Li’s clarification issued of March 22, 2001 regarding his academic record, Mr. Li instructed a search be conducted of all relevant legal documents. Mr. Li has since become aware that one company of which he is a non-executive director and one company of which he was previously a non-executive director have filed public statements which contained certain erroneous material concerning his academic record.Mr. Li has contacted the companies concerned and asked them to take all necessary and appropriate actions. PCCW only holds a very minor equity stake in one of those companies and no longer holds a minority stake in the other company.
It appears that this situation arose principally because PCCW’s equity interests in these companies were relatively small and they were not PCCW companies. As such, information for the filings was not processed by the relevant department within PCCW in accordance with the same procedures established for the dissemination of information by PCCW group companies. This oversight has now been remedied.
Let’s parse this. What PCCW is claiming is that lying to the press and the public doesn’t count. It only matters when you lie in “relevant legal documents,” such as securities filings.
Li impressed me when I met him. But his grand plans are not working out as intended, and he’s lost most of his credibility among financial journalists and people I met in the Hong Kong business community. His investors must surely be grumbling, because PCCW has lost most of its market value.
The only sensible reaction to the lie — whether it’s Li’s or his staff’s, or both — is sadness. What an unnecessary fiasco this is.
Technet Lobbies Behind Closed Doors
Some of the honchos at TechNet, a technology-oriented lobbying organization, spent time in Texas before last year’s presidential election explaining the tech industry to George W. Bush. In essence, they said jump, and he asked how high.
Now the tech crowd is absorbing valuable lessons — such as the utility of backroom dealing — from the good-old-boy energy industry, in which the president worked for a time. Many of Bush’s best friends hail from the energy business, and some of them now hold high government posts.
One is Donald Evans, a Texan whom Bush named as U.S. commerce secretary. Evans is scheduled to have breakfast with TechNet members today in Menlo Park, but somebody didn’t want you to hear what he was going to tell them, or vice versa. The breakfast was made off limits to the press, on the principle that some of the most outspoken executives on the planet would hesitate to be frank if the public might find out what they said.
Kind of makes you wonder what they want to talk about, doesn’t it? Maybe they’ll tell us, so we can tell you, at the news conference that’s supposed to follow the breakfast. Or maybe not.
When Mercury News reporter Jennifer Files asked
a Commerce Department public-relations person why the event was being held behind closed doors, he replied that this was pretty much standard operating procedure for TechNet.
A TechNet spokesperson said the organization wished the breakfast could be open, but that Evans wanted it closed.
Asked which side really didn’t want the media there, another TechNet representative said it was a joint decision.
Okey dokey.
Los Angeles Times: Energy Overcharge of $5.5 Billion Is Alleged. Money should be refunded to taxpayers and utilities, the state grid operator says, citing evidence of market manipulation. Suppliers deny the accusation.
The power generators, whose spot prices have risen so dramatically in the past year, are trying to persuade us that they aren’t doing the logical thing. And the logical thing for people with the ability to manipulate markets into higher prices is to do just that.What’s happening now is not ordinary competitive pricing. No market sees increases of this sort without extraordinary changes in conditions, namely upheavals on the order of a natural disaster, where the physical ability to deliver is severely impaired, or plain old rigging of markets. There’s been no natural disaster of that kind in California in the past several years.
An efficient marketplace explains some of the price hikes, but only part. So does entirely rational behavior on the part of the people with pricing power.
It’s striking, too, that the out-of-state generators are refusing to turn over maintenance records (AP) to the California Public Utilities Commission. Those records might show whether the suppliers have been deliberately shutting down working facilities in order to heighten scarcity and drive up prices.
What a mess. Too bad no one in a position of authority seems capable of dealing with it.
Just in case anyone hasn’t figured it out by now, electricity prices in California are about to skyrocket (SF Chronicle). There is no alternative barring a fantasy scenario — a joint federal-state takeover of the utilities and their suppliers — not that this fantasy would be anything, in the long run, but a nightmare.
If anyone truly believes that California’s businesses will really just “roll with the punches” (Mercury News) for much longer, that’s an even more foolish illusion. This state is on the verge of driving away all new business development and some existing stuff as well.
In their half-deregulation, a scheme that the utilities and suppliers lobbied for, California’s governor and legislature put all of us at the mercy of the suppliers. Now those merciless — i.e. typical — companies, which conned the lawmakers in the first place, are taking full advantage of the situation. Why shouldn’t they?
Gov. Gray Davis, who boasts all the leadership qualities of a Dilbert character, is trying to solve this mess with a series of back-room deals, excluding even the Legislature from the arrangements. If this is legal, it shouldn’t be.
Meanwhile, hapless state government employees — absurdly outmatched by the sharpshooters employed by the electricity suppliers — are trying to negotiate power deals for the utilities. You couldn’t sell this absurd situation as fiction.
The governor and his apologists pretend that there’s a way out of this without a price hike for power. Right. Instead, they’ll shift costs into the state budget. This means cutting other services, raising taxes or not cutting taxes that should have been cut.
If we pay for power through our state taxes, that’s precisely the same thing as a rate increase. It’s just disguised, and not very competently.
The state treasurer reports that this shell game has whacked the state’s budget surplus (Reuters), threatening California’s fiscal position. Taxpayers could end up footing much higher interest costs on bonds and other state/local borrowing as a result.
And the governor and his acolytes just keep on pretending they’re competent to solve this.
Who are these people trying to fool, anyway?
MacOS X Officially Debuts
News.com: Jobs: OS X here; updates on the way. Jobs took the wraps off Mac OS X during a press conference at the company’s headquarters in Cupertino, Calif. It is the first complete overhaul of Apple’s operating system since the first version came out 17 years ago, and Jobs said the new OS will have a similar life span.
HailStorm’s “Open” Architecture?
Wired News: Dot-Net: Hailstorm or Firestorm?. “By definition, if they are saying the operating system will become an online service, they are leveraging their OS monopoly into a brand new area,” the source said. “They will take control of the consumer, from the moment he turns on his brand new computer shipped to him by an OEM, and will be hand-in-hand with that consumer through every action he or she takes on the Internet forever more.”
Dave Winer asks on the Decentralization mail list if Microsoft’s desktop dominance gives it an automatic “free pass to dominance
into any market”. The U.S. Court of Appeals seems to think so.
Mercury News: Mercury News publisher quits rather than cut more. Citing the prospect of layoffs, proposed changes to news coverage and possible cutbacks in the paper’s financial support of community groups, Harris said in his letter of resignation that he feared the corporation was placing too much emphasis on economic concerns at the expense of the newspaper’s role as a public trust.
I could not say it better.
Salon Asks for Money
Salon: Announcing Salon Premium. Starting next month, for a $30 annual subscription, we will begin offering readers a special service, Salon Premium, that will include not only all the regular Salon fare but additional “bonus” features available only to subscribers.
Sign me up.
Corporate Schemers
New York Times (registration required): Questions on Firings and Severance at Computer Associates. The fired workers said that the company, which makes software that many big companies use to manage their computer systems, is disguising a mass layoff as individual firings of subpar employees to avoid paying severance. If it lacks documentation for the firings, the company might also have opened itself to lawsuits that argue that the firings were discriminatory, labor lawyers said.
More Corporate Schemers
Los Angeles Times: Fake Fans, Fake Buzz, Real Bucks. After being blindsided by the Web hype on ‘The Blair Witch Project,’ movie studios are paying for phony sites, often striving for the clunky naivete of a genuine effort.
You have to give Microsoft credit — for brains, ambition and drive.
And if the company succeeds in its HailStorm initiative, you’ll also give Microsoft your credit card.
Here’s my quick take on what I saw this morning: HailStorm is a remarkable play for the biggest time of all. It’s designed to suck all of us — software developers, businesses and their customers — into Microsoft’s version of the Internet’s next generation.
It’s also the most centralized thing I’ve seen in years, from a company that hooted down the idea of the Network Computer until the concept suddenly seemed to translate into a multi-billion-dollar annuity income for our favorite monopolist.
HailStorm, a code name that Microsoft should have avoided, given its real-life connotations, is some meat on the “dot-net” strategy the company announced last year. Fundamentally, it’s about transforming software — and much more, if you think about it — into Web services to which we’ll all subscribe (for fees, of course).
Microsoft’s consumer-friendly take on the scheme is “a new world of computing where all the applications, devices and services in an individual’s life can work together, on their behalf and under their control.” In other words, each of us will control our data, and access to it, while using it from anywhere and making it selectively available to others.
The ideas here are seductive. This may well work.
The framework of technologies is theoretically open to all comers. Maybe Microsoft is planning to pull a fast one, but I don’t quite see how they can do so, because the architecture uses developing standards such as the Simple Object Access Protocol and XML, which means it should be a multiplatform system that anyone can use.
I like this architecture, as far as I can understand it. The possibilities are truly emerging for all manner of services that could make the Net the multidirectional, multifaceted medium it was meant to be.
But if software developers and businesses don’t continue to support other, non-Microsoft Net-based software, they’ll risk trouble later on. The world’s dominant software company may not believe it can make the next Internet its proprietary preserve at the moment, but if it sees the opening, it will surely try to do just that.
That’s because Microsoft is Microsoft. And, in fact, some of what Bill Gates and his colleagues described Monday is overtly aimed at capturing what Gates himself called a “critical mass.” Critical mass, and then some, is what the company has enjoyed for years on the PC desktop.
Capturing the developers is the most obvious, and necessary, part of critical mass for any platform. If Microsoft runs true to form, it’ll provide excellent tools, plus the kind of care and feeding to which Windows developers have become accustomed.
Capturing computer users into the Microsoft universe, in various ways, is also on the agenda. Demonstration after demonstration this morning showed HailStorm services running inside Microsoft’s instant-messaging client. Each separate demonstrator (eBay, Groove, American Express, among others) had created a tab inside the Microsoft messaging client, on the assumption, apparently, that users would use only one or a few of these things. Yeah, sure. It’ll be ugly when dozens of companies are competing for this screen space, not to mention our attention spans.
You see, the other critical mass Microsoft plans to capture, beyond its Windows desktop monopoly, is you and me in new and different ways. Now we’re getting into a matter of trust. Microsoft hasn’t earned it.
Microsoft wants us to essentially move our lives onto its computers — financial transactions, calendars, address books, documents, you name it. This is the ultimate in centralization. Leaving aside the unreliability of the big computer systems the company now runs — think of the outages and problems with Hotmail, MSN and even Microsoft.com — the idea of confiding in Microsoft with my most personal information is, well, nutty.
Oh, the company is saying all the right things about privacy and security. It insists it will treat our most personal information as inviolate — that Microsoft will never mine, sell, trade or otherwise misuse that data — but I doubt that these promises are worth the PowerPoint slide they were printed on.
Here’s a challenge to Microsoft. Guarantee the sanctity of this data in a way that persuades me. How about agreeing, in writing, to a fine of a year’s revenue if the company breaks this promise?
Even if Microsoft doesn’t misuse the data, the temptation of this central storehouse will be overwhelming to other busybodies. When the government or other third parties with a subpoena or court order want access, they’ll get it.
All of the HailStorm moves are aimed in a clear direction, to move all of us toward an Internet where we pay for services we use. I don’t think that’s a bad thing. The end of “free” — a misused term — is coming, and we do need to make it work.
I’ll be talking with various folks here this afternoon. More to come.
The Earthlink Cookie Question
Steve Gibson: The Composition of EarthLink’s Custom Browser Token. EarthLink has just provided some members of the press with a plausible, and much less troublesome, explanation for the source of this token.
I’m not the first with this thought (see this Paul Andrews piece), but the everything-must-be-free model of the Internet has been a disaster. I can’t tell you how many services I use that I value and would pay for if only I could.
More in my Sunday column.
A Microsoft Hailstorm
Microsoft has given the code name “Hailstorm” to a Web services initiative it’s showing to reporters tomorrow in Redmond. By all accounts, this is a major step in the .NET evolution in which Microsoft seeks, among other things, to a) define the next computing platform; b) morph packaged software into Web services; and c) dominate the next generation of computing.
Some hints via the Web:
Robert Scoble: Are you ready for a HailStorm?. Dave Winer: Notes on non-disclosures. Infoworld: Shifting to Web services. I’m prepared to be impressed, and I’m heading up to Redmond today. Look for my report from the scene.
But I want to take note, unapprovingly, of the code name. Anyone who’s been in a hailstorm should pause at this code name. Hail is pieces of ice dropping at high velocity from the sky. Ice is a solid object. When it hits, sometimes in chunks as large as baseballs, the result is violence. It damages property and injures living creatures.
Is that the message Microsoft wants to send? Code names matter.
Response to the Microsoft Hailstorm?
Yossi Vardi, of ICQ/AOL fame, sent me an e-mail about a fascinating new site called ICQ Developers’ Tools.
Dave Winer posts the ICQ API License agreement. Looks pretty restrictive to me, too. John Gilmore: Verio is censoring John Gilmore’s email under pressure from anti-spammers.. I’m pushing back by publicizing the problem, and meanwhile allowing their censorship to take effect. If you ever want to get an email from me again, it’s time to speak up about this!
Glenn Fleishman tells Gilmore he’s wrong.
The Nigerian Financial Scams, E-Mail Style
Two get-rich-quick e-mails arrived yesterday, one right after the other. The timing was a coincidence, I’m sure, but what these come-ons have in common is their utter sleaze.
They’re an electronic version of the old scam, the send-me-your-bank-account-information trick that seems to capture people all the time. If you get one of these, send a copy to the Federal Trade Commission and then delete it.
Bloomberg News: SEC Chief to Enforce Standard. The rule, which went into effect in October, prohibits companies from giving important news to selected Wall Street analysts before they announce it publicly. It seeks to stop companies from giving briefings to a selected few on market-sensitive information such as earnings, new products and mergers.
Laura S. Unger, acting Securities and Exchange Commission chair, was the only commissioner to vote against the rule. Now she promises to be a vigorous enforcer. Yeah, right.The Reagan administration antitrust enforcers also promised to enforce the law, and did their best to gut it. Clinton’s people put other rules on the back burner while they were in office. This is the pattern with both parties when they encounter laws with which they have ideological differences.
Some critics of the FD fair-disclosure rule have linked it to the drop in tech stocks. If that’s true, it’s not an indictment of the rule. It’s a statement of how corrupt the system was before the regulation went into effect, when companies whispered their secrets into the ears of selected pet “analysts” and manipulated markets with utter disdain for small investors, the people who really got hurt by the uneven disclosure system.
But the Republicans in power, and the rich and powerful folks who put them there, like an uneven playing field. That’s one way they make all that money.
See also:
Michael C. Perkins and Celia Nunez: Small investors suffer most in market plunge. Instead of the greatest ever legal creation of wealth, the high-tech financial bubble represented the greatest ever legal transfer of wealth — from retail investors to insiders.
Eazel hit a milestone and a wall this week — version 1.0 of its Nautilus software and, the next day, big layoffs. This weblog evolved during the day yesterday and ended up as this column in the paper.
Along the way, I asked what innovations were in the GNU/Linux-Gnome-Eazel combination. Andy Hertzfeld replied with this list.
The BBB’s Institutional Arrogance
AP: Better Business Bureau tries to stop Web links. The e-mail from Beth Zialcita, a trademark enforcer at the organization, says the link “may imply or mislead consumers into assuming that our organization supports your business or that there is a business relationship between us.”
The world is full of foolish organizations. The BBB, unquestionably, is one of them.
Bush Breaks Environmental Promises
Washington Post: Bush Drops a Call For Emissions Cuts . It also effectively overruled Environmental Protection Agency Administrator Christine Todd Whitman, who had said several times since she took office that Bush would keep his campaign pledge.
A milestone — Eazel has launched version 1.0 of its Nautilus software, which it calls a “desktop-management and service-delivery platform” for the GNU/Linux operating system.
Another milestone — an unhappy one. Eazel, operating in a financial environment that’s far different than the one in which it started, is laying off 40 of its 75 workers. A spokesman says the layoffs are mostly in sales and marketing, not product development.
Let’s focus on the positive side first. The Linux community has been touting the combination of the OS and Nautilus, a GUI plus Internet services, as a Microsoft killer. That seems presumptuous, to put it mildly.
But what I know about Eazel, notably its remarkable team, and what I’ve seen of Nautilus tells me that these are smart people with some very smart ideas. Here’s an online tour of Nautilus, which I highly recommend in order to get a feel for what’s going on. (Caution: The demo page is busy today, as you might expect.)
Some are saying that Nautilus is little more than a replacement for the Mac Finder and the Windows File Manager. That misses some key points. First, and this is subjective, this UI is plain sweet. It tweaks the old standards to give you some extra utility and, again in a subjective sense, a happier experience.
Second, Eazel is at least as much about Web services as the UI. Again, other companies are working in this area, and Microsoft is making huge noise about its “dot-net” initiative. But Eazel has thought it through in some clever ways. Your data is the point — getting to it and making the best use of it, no matter where it’s located.
I’m planning to install Nautilus 1.0 as soon as possible, and will have a report for you.
UPDATE:
I dropped by Eazel today to visit with Andy Hertzfeld, the company’s co-founder and “software wizard” (that’s his title), as well as several folks from the marketing and product-development groups. Hertzfeld’s a user-interface god, one of the original Macintosh developers.
The UI has made real strides since I the last time I checked it out, way back in October. I like the tweaks more than I did before, though I’m still not persuaded it’s any huge breakthrough compared with the Mac or what’s coming from Windows. I did especially like the OS’s ability to look at various kinds of files and objects in their own real-life context. A directory of MP3 music files, for example, could be displayed not just as icons or a list but as a playlist in the built-in MP3 player.
But Hertzfeld and company are also working hard on the Eazel Services portion of the operation. The most obviously worthwhile service is the ability to add client-side software in a way that reduces the chances of screwing up your configuration. We all know what happens when we add enough apps to Windows or a Mac — things start to break. Eazel says it can learn (with your permission) enough about your system to safely and reliably add not just OS upgrades but third-party software.
Another service I liked was the quick Google lookup. Highlight a word in a file, go to the menu and select an item that sends an XML message to Google. Boom, the next thing you see is the results of a Google search on that word. This was as simple as it could be to program, Eazel folks said.
Here’s something
Hertzfeld is working on — an integrated RSS headline viewer. It’s not in Nautilus 1.0, but it’ll be in an upcoming version.
In the screen shot above you’ll see several sites inside the browser and a copy of the Linux Today site at the left, running in its own small frame. It updates the headlines every 10 minutes, Hertzfeld said. Click on the link to a story, and it’ll launch the browser (if one isn’t already running) and display the story. Distinctly cool.
Keep in mind that the Linux Today box isn’t a window. It’s actually an icon, but an extremely smart one. Eazel’s components follow the Gnome project’s Bonobo model. The icons can be resized and manipulated in a variety of ways, but they also meld with the network and file system. The Eazel icons “can represent files in intelligent ways, including making calls out to the Web,” Hertzfeld says.
The RSS viewer, which news junkies will love, is only one possibility. Consider, for example, a printer icon that shows you the current state of the print queue, Hertzfeld says. Hmmm.
Now, for the negative side. Eazel’s layoffs are a sad sign of the financial times. It’s a shame to see.
I’ve decided to give Linux and Nautilus the acid test. I’m going to load them on a laptop before my next trip and see if I can survive on the road without Windows. Stay tuned.
My Sunday column quotes some of the main speakers at this week’s ACM1 conference about what’s in store for us during the next five years or so.
I’ve also posted their replies in full. Read them here.
The Need for Diversity
Dave Winer: We’re Not So Different. The future Internet is being developed by a mix of philosophies. No one who’s familiar with Murphy’s Law should want all our eggs in one basket.
Entertainment Industry Versus Customers
Hollywood and the record companies are out to take absolute control over what we view and hear. Think the copyright laws are bad now? Just wait.
More in my Sunday column.
New York Times: As Stocks Fall, Some Analysts Prosper. His top recommendations are down 79 percent, on average, from the beginning of last year, with several trading for less than $1. But Mr. Blodget, the senior Internet analyst at Merrill Lynch, the nation’s largest brokerage, keeps his chin up.
UCITA, Just Waiting to Bite
Ed Foster (Infoworld): Some new shrink-wrap license terms seem tailor-made for UCITA. As we know, UCITA can cause plenty of problems just by validating the most common shrink-wrap terms, such as warranty disclaimers, restrictions on reverse engineering, and so on. Eagle-eyed readers, however, have spotted language in many EULAs (End User License Agreements) that appears tailor-made to take advantage of some of UCITA’s worst provisions.
Photo from Lucent Technologies
It was all zeroes and ones to Claude Shannon, and what we can’t predict is much more important than what we can. When he realized those things, he changed our world.
Shannon, the mathematician and theorist who died late last week, founded modern information theory. He was one of the intellectual giants of our time, and his work has had transcendent impact on our lives.
In Shannon’s breakthrough understanding, information was nothing more than the uncertain stuff in all those zeroes and ones. If I leave the words “a” and “the” out of sentences you’ll still get the meaning. Shannon applied a statistical model to the difference between what’s known and what isn’t. From that idea came one of the key foundations of modern telecommunications — and a host of subsequent breakthroughs that have changed all of our lives.
Shannon’s 1948 paper, A Mathematical Theory of Communication, is widely regarded as his seminal work. He won every major award in his field. It’s a shame there’s no Nobel Prize for mathematics.
More on Shannon:
Biography by N.J.A. Sloane and A.D. Wyner of Bell Labs. (Wyner died in 1997). More on Information Theory:
Lucent’s Information Theory site. A short course in Information Theory from Cavendish Laboratory, Cambridge, U.K. A diagram of Shannon’s mathematical model of communication. A Mathematical Theory of Communication, Shannon’s groundbreaking paper. IEEE Information Theory Society.
This posting reminds Julian Bond of Ciphers : A Post-Shannon Rock ‘N’ Roll Mystery. “If you like early Pynchon, Robert Anton Wilson or even Neal Stephenson, you’d like this,” he says.
An Irresponsible Act
The U.S. House Ways and Means Committee didn’t wait for hearings or deliberations of any kind before it approved the Bush administration’s dangerous tax plan (AP), a gift to the very rich and a potential disaster for everyone else.
The Republicans, setting a new standard for fiscal recklessness, think it’s fine to let our children and grandchildren pay for our prolifigacy. We, the generation in power, borrowed trillions of dollars to pay for our own needs. Now we refuse to pay our debts.
It’s not as if the general public is gung-ho for this gift to the rich. Polls show, in fact, that the public tends to oppose the Bush package in favor of a smaller overall trim in taxes with more of the benefits going to lower and middle income taxpayers.
Our children may hate us for what we’re doing with such abandon. I won’t blame them.
Network Solutions Gives Ground? Not Really
Wall Street Journal: VeriSign to give up .org, .net. The new agreement preserves VeriSign’s control over the “com” master list through 2007 and promises the company a special “presumption” that it will be allowed to continue in that role afterward. Currently, dot-com addresses comprise about 80% of the world’s Web addresses.
Judge Jackson’s Recklessness
With justification, the appeals judges in the Microsoft case have blasted U.S. District Judge Thomas Penfield Jackson (Mercury News) for his indiscreet remarks during and
after the Microsoft trial.Jackson was absolutely correct in what he said — because he was telling the truth about the Microsoft executives and lawyers who mocked his courtroom and the legal system with lies, evasions and sheer arrogance.
He was absolutely wrong to say it to journalists — because he gave the appearance of bias even though there is no evidence that he leaned in any direction before the case began.
And when the Appeals Court tosses him off the case they will be doing everyone a favor — because even the appearance of bias is enough in these situations.
I have trouble fathoming why Jackson did this. He told various interviewers he was just trying to be open in a case of enormous public interest. But that’s sophistry. His statements from the bench, such as the time he told Microsoft lawyers that their problem at the moment was their own witness’ testimony, and written opinions were the only proper forums for a federal judge before the case was over.
Yes, he embargoed everything until after his ruling, after the case was out of his hands and in the appeals court docket. But he surely knew two things — that there was every chance that the remedies order would be sent back for further consideration and that he might poison everything he’d done.
What Jackson did was improper, pure and simple. If his findings and rulings are thrown out because of his statements to the press, he will have done enormous damage. He will have improperly let an arrogant corporate lawbreaker off the hook as a consequence of his own egotism, and given the company license to do more of the same.
Worse, he will have done serious damage to antitrust enforcement. The Microsoft case will set a benchmark for competition policy in the Digital Age. Judge Jackson’s recklessness may help create a policy that is viciously anti-competition just when we need real enforcement.
Courtney Love’s Industry Challenge
Los Angeles Times: Singer Seeks to Rock Record Labels’ Contract Policy. At its core, the suit is about the recording industry’s tradition of long-term contracts that keep artists tied up for years longer than is legal in other industries, including television, film and sports. And it seeks to end the practice that allows companies to buy and sell artists’ contracts, often against their will.
Wall Street Follies
New York Times: Former Cendant Executives Charged With Fraud. The charges contend the fraud went on for more than a decade, with company officials systematically altering financial statements to increase profits in order to impress investors.
Richard Stallman’s Response to Jim Allchin
Richard Stallman, founder of the Free Software Foundation, sent his reply to comments from Microsoft’s Jim Allchin. I’d mistakenly posted a draft last week.
US v. Microsoft: Appeals Judges Draw Blood
I didn’t have time to post anything here yesterday because I was in Washington for part of the first day of the appeals hearing in the Microsoft antitrust case, standing in line outside at 6:30 a.m. to be sure I got a seat. Later I flew to L.A., where I’m giving a speech this morning at a technology conference.
The piece of the appeals hearing I heard — it runs two days, including today — was fascinating. News outlets are pretty much confirming what I suspect, that the judges were a bit rougher on the government than Microsoft (Mercury News).
Here are some of my impressions.
New Media, Old Problems
The Industry Standard: Learning from the Inside. The ride has had more dramatic ups and downs than we anticipated.
I have a lot of respect to Jon Weber, who wrote this piece, and the magazine he edits. Like Salon, a pure Internet magazine, and some other media startups from the past few years, it’s run into economic cycles and other realities that many had dismissed. They’re in a rough patch. I know the Standard will survive, and I hope very much that Salon does as well. Quality deserves to live.The Microsoft Case Resumes
Microsoft’s day in court resumes tomorrow (Mercury News) as the company tries to convince a federal appeals court that a district judge was mistaken when he slapped the company with severe legal findings and an order to be broken up. Oral arguments before appeals panels usually take an hour or so. This one will go for two days, an indication of the hearing’s importance.
Some people believe Microsoft is a wounded or — you might want to laugh at this — reformed company. I certainly agree that conditions have changed, and that Microsoft shows signs of understanding that it can’t rule everything, but it’s still making enormous profits and exhibits much of the same old behavior.
More in my Sunday column.
This Kid is No Hero; Nobody Is
New York Times: Jonathan Lebed: Stock Manipulator, S.E.C. Nemesis — and 15. And if the law ever declared formally that Jonathan Lebed didn’t break it, the S.E.C. would be faced with an impossible situation: millions of small investors plugging their portfolios with abandon, becoming in essence professional financial analysts, generating embarrassing little explosions of unreality in every corner of the capital markets. No central authority could sustain the illusion that stock prices were somehow “real” or that the market wasn’t, for most people, a site of not terribly productive leisure activity. The red dog would be off his leash.
This is an extremely disturbing and important story. It reminds us just how far into an ethical cesspool Wall Street fell during the recent technology bubble — and how many Americans the traders lured into the muck.Lebed, the protagonist of this tale, is the teenager who hyped stocks online and made hundreds of thousands of dollars buying and selling as suckers lost money. He’s a sleaze. Period.
Yet the Securities and Exchange Commission didn’t force him to give back all the money he made in his little game, and no wonder. The SEC probably would have lost in a court, because the game this kid was playing hardly differed from the one so common on “official” Wall Street — the hyping of stocks by biased analysts who were little more than shills for the companies their firms took public, and then ran secondary offerings, all for enormous fees.
Don’t get the wrong message from this article. The moral is not that this teenager was using the Net to beat the professionals at their own game. It’s that they were all — big guy and little guy — able to gull so many investors into buying stocks they knew nothing about, solely on the advice of unknown chatroom touts or famous Wall Street analysts. In the latter case, it was all legal. Why was it
illegal in the former?When will the SEC go after the famous analysts and their companies who were such an integral part of this legal scam? Never, most likely. That’s how it all works when markets are rigged by the rich and powerful.
I suspect that the days of SEC enforcement of so-called truth-telling in the securities marketplace are just about over. The Internet is too powerful a force for communication to stop the little guys from being touts.
It’s also over because the people who write and enforce the securities laws don’t dare force Wall Street’s rich and powerful to tell the truth themselves. In a world where that does not happen, it is unfair to go after the small fry like Lebed.
So here’s a better lesson, maybe. Don’t believe what you read from people who have a stake in the outcome, not unless you’ve done a lot of homework on your own. Don’t let the sleazebags rip you off, because if you do in this culture they’ll just say it was your own fault. And maybe they’ll be right.
Locked-Down Hard Drive Scheme Derailed
The Register: IBM withdraws CPRM for hard drives proposal. “People are not going to buy crippleware,” said Stanton McCandish for the Electronic Frontier Foundation
Open Source, GPL and Allchin: Stallman Responds
I heard today from Richard Stallman, founder and president of the Free Software Foundation, regarding the debate over Jim Allchin’s comments last week in which he disparaged open-source software. Allchin, you’ll recall, said he was only talk
