Category Archives: current events

I’m moving to Texas

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Last night, after the sessions at LISA ended, I decided to go out and eat some meat. After all I am in Texas.

It turns out the place I went to is within walking distance of my hotel, The Hyatt Regency, on 702 Ross street off of Market and is called Y. O.  Ranch.

And yes the meat was fantastic.

But the reason I wanted to move to Texas is because there were 5 or 6 steak houses right next to each other! Literally one right next to another. Not fancy fluffy California fusion with mixed greens and arugula, but honest to God steakhouses! Places where the beef was beef and the meat was meat and the men were men.

This is a place, where buffalo meat is considered exotic!

When I told the waiter that I live in California, he smirked at me and asked if they actually serve meat in the state. I told him yes, but the steaks you buy are about 1/18th the size, and most of the time the waiter is explaining how the cow was a happy cow that lived a full and productive life when he’s not looking at you like a baby killer. I then told him about my challenges in trying to find a spit-rod for my roasted Lamb, and he had this perplexed expression on his face: why is finding a spit-rod so difficult to find? How do you roast pig?

So I am moving to Texas.

My wife pointed out that if I do move to Texas, i have to support Bush. But I pointed out that Texas was also the home of such fine upstanding politicians like Lyndon Johnson and Ann Richards. And after all I live in a state with a Governator!

Save Raw Milk — Oppose AB1735

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The California state government, bowing to the pressures of the large agribusinesses that do most of the farming, have chosen to ban the sale of raw unpasteurized milk. Of course, an outright ban would have been too obvious, so instead they made the requirements to ship so onerous, that the small farmers that sold the milk will no longer be able to sell it.

This is an outrageous, unacceptable, overreach by a state legislature to kill a segment of the farming community to serve it’s political paymasters in the large agribusiness under the tattered fig leaf of concern for the health of Californians.

If you care about the right of individuals to buy products that are safe then please go to this website:

 http://www.organicpastures.com/contact_lawmakers.html

And follow the instructions to protest this recent law.

As if we don’t have more important matters to worry about.

gPhone: Google’s capitulation?

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The recent announcement by Google around the gPhone has been portrayed by the press as a game breaking move. That somehow a new free OS that is customized for cell-phones somehow, once again, changes everything. And that more, to the point, that was Google’s plan.

I disagree. In fact, I believe Google had grander ambitions, those ambitions proved too costly, and that the recent announcement was an admission that those plans were shelved. And that Google was signaling to the cell phone carriers that they were going to play by their rules.

Hence, the blog title: Google capitulation?

Here’s what I think:

Google’s management team correctly observed that the future of search was search on the cell phone. And that location based search on a cell phone was going to be a tremendous revenue opportunity.

The challenge was that the current cell phone carriers act as tax men. You can’t sell a service without putting the service on a cell phone that the carrier sells. And the cell phone carriers themselves had ambitions on how exactly those advertising services were going to be delivered.

But why would the carriers be any different than MS and Yahoo in their ability to compete with search?

Unlike Microsoft and Yahoo, the cell phone carriers thanks to their connectivity to customers through Yellowbook, and the fact that they sell phone numbers, have the sales force, and the business process to create a real alternative local search advertising market.

So if you’re Google, and you have more money than God, you think outside of the box. If the problem is that the cell phone carriers control access, you need to create a new network that does not have the cell phone carriers acting as the gatekeepers.

To do that Google needed three pieces:

  1. A network that could carry phone calls that was not owned by the cell phone carriers.
  2. A set of devices that would connect to that network
  3. A set of compelling services that would cause people to select that network.

So what was the plan?

Let’s look at them in reverse order. For (3) Google was building it’s own applications, and then buying startups that offered innovative cell phone services. For (2) Google was working on an OS and reference platform. And for (1) Google had a three pronged strategy. The first was to build Metro WiFi like they did in Mountain View and San Francisco. The second was to bid on the wireless spectrum and either build or lure someone to build the network. Third was to create a regulatory environment that would allow other virtual carriers to build their own networks.

I believe that the cost of (1) became prohibitive along two dimensions. The first was the sheer dollar cost to build. The second was that while Google was building out it’s competitive network, the existing cell phone carriers would treat Google and their software as enemy number one. In many ways, the Google move might force the carriers to embrace Microsoft and Yahoo. The potential loss of revenue while the network was being built out and the cost of the network just made the strategy impractical.

Confronted with this reality, Google scaled back it’s ambitions, and like a researcher who has failed to prove something significant, they looked for pieces of that strategy that were still valuable and tried to get some value from them.

And that’s what the gPhone announcement is about. Unlike every Google announcement in the past, Google was announcing vapor. Nothing real, no product, just a statement that the grand cell phone strategy was about releasing a free OS to cell phone carriers.

With that announcement Google was signaling to the cell phone carriers that their plan was to play by their rules. Like Microsoft, Blackberry, Nokia, Palm and Apple they were going to release an OS, that the handset providers could port to their devices, that the cell phone carriers could certify and that Google would continue to be a software provider into those walled gardens.

Google was no longer planning to build an open, unwalled garden.

Google capitulated to the existing market reality. Perhaps we are seeing the limits to even their ambitions?

iPhone: This changes nothing

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It’s happened. My Apple friends, you know the ones who run around proclaiming the Mac’s greatness, have gotten their hands on iPhones. Now I will be subjected to claims about how great the iPhone is and how it changes everything in the cell phone market. Already they are asking whether, Nokia, the global leader with 400 million phones sold per year and approximately 50 000 employees devoted to exactly one market is doomed, doomed I tell you.

Let us, for a moment, exit the Steve Job’s reality distortion field. So I’ll make two seemingly contradictory statements:

  1. The iPhone’s success is critical to Apple.
  2. Even if the iPhone succeeds it is irrelevant to and will barely affect the broader cell phone market.

Let me start with (1).

Apple has consistently occupied a niche in the broader general personal compute market. A market I define to include all devices that people use to browse the web, message, entertain themsevles and generate content with. If you exclude the biggest segment, the cell phone, Apple’s global share of the PC market is an almost irrelevant 5%. The problem for Apple is that the 5% Apple owns is absolutely irrelevant to the emerging personal compute platform that is the cell phone. In other words, regardless of whether Apple owned 10 or 15% of the laptop market without some kind of cell phone strategy the long term prospects of the company were questionable. The thesis for this argument is that as more and more users migrate to cell phones to do most of their laptop activities, the value of the laptop declines and the value of the cell phone as their dominant personal compute platform increases. In other words, over time, the cell phone becomes the laptop, the laptop becomes the desktop, and the desktop becomes the mainframe. Why this is important to Apple, is that Apple’s market tends to self select among people who are willing to adopt newer and more exotic technologies. There was always the possibility that the right phone may affect Apple faster than the broader Microsoft market.

Furthermore, the reality is that unlike Microsoft, who after 6 years of trying finally has finally produced a credible cell phone OS that actually runs on a non-trivial amount of cell phones Apple had zero presence in the market. Vista and Mobile Windows are fairly well integrated and that the integration creates the possibility that the Mobile Windows may drive Windows OS sales over time. This could, in theory, impact Apple’s long term (tiny) position in the computer market.

Apple had two strategies open to it. One was to try and get cell phone manufacturers to adopt the Mac OS or Apple applications preserving some kind of presence in the cell phone market. The second was to build their own custom designed cell phones. Proving, again, that Apple is a hardware and not software company, the strategy they chose to adopt is to build their own phone with their own OS. In effect, Apple decided that Apple needed to build their own device so as to provide a home for their fans so as to preserve Apple’s overall share of the personal compute market.

In fact, the iPhone’s success is critical to Apple. If the iPhone flops, this may create an oppening for some of those Apple users to migrate to other computer platforms. The reason may be better integration with their dominant compute platform, namely the cell phone. Thankfully, for Apple, the early news is that the ancient hardware platform they built has been a smashing success with their fans, thanks to the rather clever software interface they built. So kudos to Apple!

Having just congratulated Apple on their first phone, I am worried that the first cell phone they produced was already ancient in terms of hardware technology. The cell phone market is not the mature PC market. The cell phone is a rapidly evolving hardware platform. There is an open question as to whether Apple can simultaneously sustain the level of innovation in both the PC and cell phone market necessary to compete over the long haul. An iPhone that is always two years behind the rest of cell phone market becomes less interesting over time.
Now let me address point (2):

Even if the iPhone succeeds it is irrelevant to the broader cell phone market and will barely affect the broader cell phone market.

The most irritating aspect of the Apple fan is his belief that the iPhone will somehow change the dynamics of cell phone market or perhaps even disrupt the dominant player in the cell phone market, Nokia. The central thesis of the argument is the following:

  1. The iphone is like the ipod, a disruptive technology, that the major players will be unable to react to
  2. Because the iphone is like the ipod, a disruptive technology, Apple will become the dominant cell phone player
  3. The cell phone manufacturers will go out of business and Apple will finally rule the computer market!

Before I even point out why I think this argument is deeply flawed, let me observe that the iPhone is irrelevant to the broader cell phone market.

The total cell phone market is approximately 1 000 000 000 cell phones (http://www.ipsnews.net/news.asp?idnews=36161) per year. If the iPhone sells 5 million per year that’s 0.5% of the global market. As a point of comparison, Nokia sold 106 million phones in the quarter ending Jan 1st 2007 (http://www.infoworld.com/article/07/01/25/HNnokiasalesup_1.html)

Heck even in the United States there are approximately 120 million subscribers between verizon and att. Assuming 1 cell phone per subscriber, if the iPhone sells 10 million units it will have hit ~8% of the verizon/att market and less than 4% of the total US market.

Practically speaking the iPhone may eventually own a tiny market of the global market, but is utterly irrelevant in the places where the growth in phones is most dramatic (the emerging markets of China, India and Africa) because of the cost and form factor of the device.

The most optimistic scenario for the iPhone for it’s impact therefore, is the following:

I think in the most optimistic scenario,the iPhone is to the general mobile cell phone market what the Mac is to the PC: pushing a few trends faster but generally irrelevant.

Of course, anyone who believes in disruptive technology will gladly point out that the dominant players are never weaker than when they appear strongest.

So is the iPhone like the iPod, disruptive to the rest of the cell phone market?

I think the answer is no. The iPod was disruptive to the personal media market because it was the first device that had enough capacity to carry most of your music as well as an elegant form factor. The iPod was, therefore, able to take advantage of the transition of media to digital form. The reason no one else was able to respond was that the players in the market at the time were either too small to compete with Apple or (cell phone manufacturers and Microsoft) completely missed the boat.

The iPhone has a pretty UI on top of a marginal hardware platform. Apple has not invented the first usable cell phone. Apple may have invented the first usable cell phone based web browser. However, the problem is that the cell phone vendors are not some puny players that are incapable of reacting and Apple’s global share is too small to make their current advantage meaningful. The most reasonable claim is that Apple’s disruptiveness is tied to the fact that they do software and they understand industrial design. The problem is that cell phone vendors understand industrial design (Motorolla RAZR) and increasingly understand the value of software (possibly because of Microsoft). The major cell phone manufacturers are aware of the importance of the software platform and have been aggressively investing and re-organizing to become software players. If you combine their ability to innovate in hardware, their manufacturing capacity, their global reach and their new found focus to create software the most likely outcome is what I said earlier:

I think in the most optimistic scenario,the iPhone is to the general mobile cell phone market what the Mac is to the PC: pushing a few trends faster but generally irrelevant.

I just don’t see the cell phone vendors falling asleep and giving Apple the time necessary to build the capacity necessary to compete with them. Of course, I could be wrong, but it seems extraordinarily unlikely.

I still believe the largest long term threat to the cell phone manufacturers and in particular Nokia is Windows Mobile because of the increasing integration between the cell phone and the laptop. Having said that, the laptop may become irrelevant over time, making that integration a niche part of the overall personal compute market.

In short, bravo to Apple for introducing a good phone. But unlike Steve, I believe this changes nothing.

Organic, shmorgamic.

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I find the recent craze about organic food to be irritating. Everything and anything is organic as long as it satisfies some bureaucrats idea of what organic should be.

When my grandma thought organic she thought food grown by a farmer who cared about the product he produced. In particular she did not think that processed food was organic. Probably she would have been appalled to learn what her grandson eats.

The absurdity of the definition of organic was brought home today by my wife. She bought organic string cheese from Trader Joe’s. What part of a processed cheese in the form of strings is organic?

So pardon my French, but organic string cheese is only organic if you’re a bureaucrat concerned with chemical compounds and not the basic process of food production.

A pox on them and their products.

Take me out to the ball game…

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Last time I checked we’re still involved in a civil war in Iraq.

Last time I checked we’re still involved in a civil war in Afghanistan.

Last time I checked I still can not bring booze from my uncle’s winery onto a plane.

Last time I checked baseball games were a place I could go and forget about that.

Not any more. In our post 9/11 world, Take me out to the ball game has been replaced by God Bless America.

I was surprised to discover how much this pissed me off. And I realized why later. It’s another cheap way for us to show our support for our troops without having a draft, taxes or rationing. Maybe if we had a draft, taxes and rationing, we could have our passtime back….

Fuck Landis. Fuck him and The Tour De Tricheurs.

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So it turns out that Landis’ miraculous ascent was chemically enhanced.

Was he a fool? A moron? Or both? They had just thrown out the 2005 top finishers from the Tour thanks to the Spanish affair. Did he think he could get away with it? Did he think that they would not test him? Did he think?

And as for phonak… Are we really expected to believe that the team had no idea what was going on? This is the Tour not some amateur race. The atheletes have more doctors and masseurs pampering them than patients in the Intensive Care Ward of hospitals. This is not credible that somehow Landis was able to inject himself with drugs without the team medical staff knowing about it.

So fuck Landis, and the entire sport of professional cycling. The lack of personal integrity on the part of the cyclists is appalling. Perhaps if sponsor’s were criminally liable for the cheating of the athletes we would see this sport clean itself up.

But in the meantime. Fuck Landis, Fuck the Tour, Fuck it all. In one appalling year Landis, Ullrich etc have managed to destroy what Armstrong built in 7 years. Damn them all.

As for me, I’ll stick to basketball, football, and hockey. At least there we do not maintain the pretense that the Athletes are clean. We admit it’s a form of entertainment, where the personal integrity of the players is irrelevant.

Isaac Hayes discovers exploitation is wrong.

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Isaac Hayes recently discovered that exploiting minority group idiosyncracies for cheap laughs was wrong and has resigned from the cast of South Park.

Isaac Hayes did not find Shaft the original blacksploitation film problematic for it’s depiction of black inner city life.

Isaac Hayes did not find the character of Chef problematic. A character who embodied ever racist stereotype: the black man as servant, the black man as a predatory sexual threat to white women, the black man known by his function as a servant to the white man not his person.

Isaac Hayes did not find the viscious attack on the Mormon faith problematic in the South Park episode All About the Mormons.

Isaac Hayes did not find the ongoing mockery of Christ, buddhism, Christianity, Islam, Homosexuality, PETA etc problematic.

No, Isaac Hayes found the critique of the Church of Scientology as being inappropriate.

sigh.

How odd that a cult devoted to extracting wealth from fools would have finally taught Mr. Hayes that although South Park is very, very funny it does push the line of appropriateness.