September 17, 2008
Running a Corporation

Carly Fiorina, CEO of HP, recently got into trouble when she said that Sarah Palin couldn’t run a corporation. She quickly amended that to say that she was talking about specific business credentials, and that John McCain (who was responsible for the BlackBerry, don’t you know), Barack Obama, and Joe Biden were similarly unqualified.

That brought me to think about exactly that question–how would each of the four perform as a chief executive of a corporation? Having no experience in or knowledge of the job or the environment, let me give my completely unqualified assessment, and see if you agree.

McCain would be the closest thing to a pointy-haired boss; especially in a tech corporation, he would likely not understand what he was selling. He would probably lead by whim more than by far-sighted planning, and would probably be easily influenced by those around him, doing either the last thing someone told him was a good idea, or the thing that the most people on his senior staff thought was a good idea. His mercurial temper would not help. He might have a few priorities and directions he would want to go in, but these would be limited in scope and importance. He would be uninspiring overall–workers would be less than impressed with grampaw’s war stories, and more affected by his poor speaking style. His health would spark concerns that would dampen (or, I suppose, spark) stock prices, and people would always be asking about who’s next in line to take over.

Palin would be the usurper, the lightweight that shot up to the top for a variety of reasons not having much to do with actual talent. Though sharp and ambitious, she would not be the productive type; she would have gotten to where she was over the backs of others she tore down along the way, or by the helping hand of those above who favored her. There would be widespread concern about how capably she would govern, and while she might win over the PR crowd, the professionals would have strong doubts. The social pages of the newspapers might herald her self-proclaimed accomplishments, but those in the know would laugh at the claims and understand her for the lightweight she is; look to the boring columns in the financial sections to read far-less-optimistic reviews. Those working for the company would be unhappy–people in any management position would be in constant fear of being fired (except for the neophytes, cronies, and kiss-ups), and those below would be wondering what draconian edicts would restrict their working conditions next. She would bring light to the company, but not progress, efficiency, or productivity.

Biden would be the college-professor type of CEO–a good deal of knowledge and experience, but otherwise uninspiring. He might miss the big picture for the details, and some would see him as ineffectual. While some workers would be comfortable with the low-key professional, others would be worried about whether or not this leader could take the business where it needs to go, and whether the big boss had what it takes to sell the company and make it thrive. Biden would have connections, but not necessarily the power to bring the company to the heights expected of it. He would be far preferable to McCain or Palin, but would just not be the type who would make a company a great one. The corporation he ran would be as low-key as he is–getting by, doing OK, but never in the big leagues.

Obama, while a new face, would be the only one who would really do well as a CEO. While relatively inexperienced, he would have two necessary things that any of the other three would not: the charisma to drive the company and sell the product, and the intellect to grasp what the company needs to do and how to do it. While Obama technically has no executive experience, he did start from virtually nothing and build a multi-hundred-million-dollar organization which took on and took down one of the biggest, if not the biggest political dynasty around. Obama is, in fact, closer to a self-made dotcom startup that offers a great new product that everyone wants to try. It might be heavy on flash and style, and it will have bugs, but still has the substance to sell. There is the same effect in both cases–people who like the product say it’s really great, and the naysayers quickly tire of the fans, exaggerate the expectations, and then try to shoot down the company for not being 100% perfect and delivering a product of god-like perfection. But the product is still solid and sells well. Obama is similar to Steve Jobs–someone with very good business intuition and the public persona to sell it. Everyone working for him might wonder if he could take on Microsoft after leaving Dell in the dust, but they’d be optimistic about the stock options and excited about the person leading their corporation.

Thoughts?

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Written by Luis at 12:14 pm | No comments so far
 

August 2, 2008
WalMart to Employees: Vote for Republicans or Evil Unions Will Sodomize You!

In case there was any remaining doubt about whether Wal-Mart was completely without any sense of morality or ethics, this article should dispel those illusions. They are telling their people that unions are bad and they should vote against Democrats who will help the unions. Now, I’m not legal expert, but isn’t such mandatory anti-union and vote-persuasion propaganda illegal in this context?

“The meeting leader said, ‘I am not telling you how to vote, but if the Democrats win, this bill will pass and you won’t have a vote on whether you want a union,’” said a Wal-Mart customer-service supervisor from Missouri. “I am not a stupid person. They were telling me how to vote,” she said.

And can Wal-Mart get off the hook simply by claiming they’re not doing what they’re obviously doing, or is that power limited only to the Republican Party? Or is there no difference?

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Filed under: Corporate World,
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July 7, 2008
They Gotta Be Going Somewhere

It’s not entirely clear how accurate it is, but a survey (PDF) done by the Ponemon Institute (yeah, I know) for Dell claims to have found that on average, about 10,300 laptops go missing at the 36 biggest airports in the U.S. each week. Averaged out, that’s about 40 laptops lost at each major airport every day. The frequency of reported loss is not equal, though; LAX has the highest, reporting about 1200 lost each week, or about 170 per day. 69% of those lost at major airports are never recovered.

Even stranger, the place where people lose their laptops most is at security checkpoints–airports report that 40% are lost there. 23% are lost at the departure gate, 9% in restrooms, 7% at food service, 6% at clubs or lounges, 6% on transport systems, and 4% each at retail shops and ticketing counters.

Something sounds fishy here. Assuming the data is accurate, then even accounting for intentional theft being higher at airports than elsewhere, that still sounds like a very high number. Even people who carry laptops belonging to their companies understand how expensive they are; I don’t know of many people who treat the things casually. A laptop is not exactly something that you just put on the seat next to you and then forget about, like a dog-eared paperback.

Some of the locations sound strange too. Why 40% at security? It’s not as if the laptops are out of your sight for very long. Even if you account for people in front of you “accidentally” picking up your computer, it still sounds high; again, it’s a place where people tend to be wary of stuff like that. And restrooms? How the hell does that happen?

So, being the cynic that I am, I have to wonder exactly how many of those “lost” laptops are actually stolen by the people claiming to have lost them, using the airport as a convenient excuse? Seeing as how large companies most likely reclaim such losses via insurance, it seems likely that employees might consider such theft “covered” and therefore more attractive.

But there’s another possibility: the survey was commissioned by a computer company selling a security system> I am always suspicious of “research” released by people trying to sell you something.

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Written by Luis at 9:03 am | No comments so far
 

July 1, 2008
Mac Market Share

There’s a story hitting the news wires: the Mac has hit an all-time high of 7.95% market share, more than ever before, with the impression being of an immediate upward trend for Apple. Last year at about this time, some clueless tech writer at Computerworld wrote that the Mac OS was flailing while Vista showed robust growth, using the exact same source of stats that the new story uses (Net Applications’ tracking data). I wrote a blog post explaining in detail why this guy was full of it. Both stories–the one that was negative about Macs last year and the one which is positive about Macs this year–are wrong, and for similar reasons.

Yes, a new all-time high about Mac use is nice to hear, but not impressive to me right now. The reason: it’s not Mac season yet. I have noticed a pattern over the past three years–here’s the data over that period of time:

Macuse-Na

The areas filled in with green show sustained growth. See a pattern? Every year, starting in September, there is a sustained growth burst that continues until January. Between February and August, there are minor fluctuations, but the market share generally remains static.

The growth spurts are dramatic–less than 1% growth in terms of total market share in late ‘05 (but that was bigger in terms of percentage of growth over the existing brand market share), 2% in late ‘06, and close to 1.5% in late ‘07. But right now we’re in the lull period.

Not to mention that the larger rise took place in May, not June (which was only a slight uptick from May), which was not really reported on. And if you look back, for some reason, there has always been a peak around April or May, so this is not a surprise. The safe bet is that the number will fall again in July and/or August, but then take off again in September, as always–probably representing back-to-school sales which create the growth spurt which lasts into Christmas sales, dying out soon afterwards.

Now, I’ll be surprised if the numbers continue to grow before September; that would be unusual, and could signal a bigger-than-usual surge in the latter third of the year. But right now, it’s not clear how big that surge will be. Yes, the iPhone 3G is making waves, but the original iPhone was making even bigger waves a year ago. While the current spurt trend–only two data points long–shows a slowing increase (2% to 1.5%), that’s less a trend than it is just a couple of data points. The surge this year could be anywhere from a 1% increase up to about 9%, or a 2% increase again up to 10%.

The only thing I’m pretty sure of is that there will be a surge–that’s the safe bet. And if you take a look at Apple stock, you’ll see a similar trend: a general pattern of big increases in the latter half of the year, with slower growth, decreases, and/or volatility in the first half.

Appl05-08

That graph is less clear-cut, but you’ll notice that the biggest increases, especially when you discount the drop-and-recover beginning of 2008, always fall in the second half of the year, peaking over the new year, and then dropping or at least slowing. But since 2003, there’s never been a value drop between June and December.

Those seem pretty clearly to be the golden months for Apple.

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Written by Luis at 11:04 pm | Just one comment so far
 

April 24, 2008
Republicans Reinforce Job Discrimination

Wow, the right-wingers are really showing their true colors as bigots. They just filibustered (what, the 5,349,816th time this session?) a bill that would make it possible for workers to sue for pay discrimination, essentially killing it. Obama and Clinton returned to D.C. to vote for it, and McCain stayed away, signaling that he would have voted to kill it anyway.

Let’s rehash: this is based upon a scummy re-interpretation of law by the Bush administration. The original law was intended to make it so that if you found out your employer was paying you less than another worker for the same job because you were the wrong gender or race, you could sue them, so long as you filed suit 180 days after the last occurrence of the discriminatory pay. That was obviously meant to be structured so that the 180 day deadline happened after the last disparate paycheck was issued.

In a suit based upon this law, an employer tried to claim that the 180-day deadline started when the initial decision was made to issue unequal pay, taking advantage of wording that was just nebulous enough to allow for that interpretation (if you’re a complete idiot). Co-workers don’t immediately disseminate how much money they make to all coworkers, and employers often strongly discourage (or even try to prohibit) such sharing in any case. Finding such disparity within 6 months of the initial pay difference is so rare to discover that the law would essentially be meaningless under the new interpretation. It’s about as obvious as it can get that this was not the way the law was supposed to work.

The plaintiff, Ms. Lilly Ledbetter, won her case, and all the appeals until it reached the conservative-stacked 11th circuit (a spin-off of the 5th circuit, the most conservative in the country)–whereupon the law suddenly changed to support discrimination. Then the case was appealed to the Supreme Court, and naturally, the Bush administration jumped on the company’s side, filing a brief in support of the bigotry, in opposition to the EEOC’s rational application of the law in accordance with decades of precedence. And the 5-member Republican majority on the Supreme Court voted along straight party lines to uphold the ludicrous reinterpretation that essentially gutted the law. (Message: if you’re a corrupt, lawbreaking corporation, now is the time to get your suits before the high court! Get the payoffs while they last!)

Some right-wingers used the “it’s the law’s fault” defense, saying that they’d like to fight against discrimination, but darn it, the law is just so clearly written to be stupid, we have no choice but to follow it and be stupid ourselves. The Bush administration made no such dodges; they simply claimed [PDF] that once a decision was made to discriminate, a corporation could not be expected to remember that it had initiated such discrimination beyond 6 months, and it would be a travesty if people were allowed to sue after discrimination had continued for years and years. (They even made the deranged argument that the Ledbetter law would discourage allegations of discrimination from being “expeditiously resolved.”)

So if a corporation got away with discrimination for 180 days, then they were home free–untouchable from that point on. As I pointed out before, this asinine view of the law just begs for abuse, and is even institutionalized in posterity if pay increases are decided as a percentage of initial pay levels.

Well, no problem–just re-word the law so that it clearly states the obvious intent. But there’s a big problem–no, two big problems: one, the president–who vowed to veto the reworded bill, and now the Senate Republicans, who just filibustered it to death before it could even get to the president’s desk.

So the conservative wingnuts in all three branches of government have not voiced their intent to let bigotry reign.

Ready to vote yet?

Oh, and I almost forgot to mention: the insidious Liberal Media™ continues to call Republican obstruction “blocking” or “denying” in their headlines, even eschewing the correct term “filibuster” in the full text of most of the articles covering this story (the few that there are, that is). They showed no such reluctance to use the word “filibuster” almost endlessly in the far more rare cases when Democrats blocked a handful of the most extremist right-wing judicial nominees.

Oh, and here’s a bonus bit of Republican hypocrisy:

Republicans said Democrats were playing politics, by timing the vote to give the Democratic presidential candidates, Sens. Hillary Clinton of New York and Barack Obama of Illinois, time to return to the Capitol from the campaign trail. Both senators spoke in support of the bill before the vote.

Yes, how terrible that they allowed senators time to vote on legislation. As opposed to four years ago, when Kerry returned to D.C. to vote for a veteran’s health care vote… and the Republican leadership delayed the vote so Kerry couldn’t vote on it. Those Republicans are just pips, aren’t they?

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Written by Luis at 11:29 pm | 2 comments so far
 

March 14, 2008
RIAA: “Hmm. Suing Customers Didn’t Seem to Work. Let’s Try Forcing Everyone to Pay Us Lots of Money!”

The latest display of unfettered greed from the RIAA:

Having failed to stop piracy by suing internet users, the music industry is for the first time seriously considering a file sharing surcharge that internet service providers would collect from users. …

[The] idea is to collect a fee from internet service providers — something like $5 per user per month — and put it into a pool that would be used to compensate songwriters, performers, publishers and music labels. …

“If ISPs do not cooperate voluntarily,” [U2 manager Paul] McGuinness declared, “there will need to be legislation to force them to cooperate,” McGuinness said.

Um, right. Good idea.

Preface: the reports I have seen say nothing about this idea including the legalization of music file-sharing. I would presume that if the RIAA were suggesting that the $5 fee would allow everyone to legally download all the music they want for no extra cost, it would be a huge story and everyone would be covering that angle. From what I have read, they seem to be suggesting that the $5 surcharge only compensates them for what pirates steal, and nothing more; people would still have to pay for their music in addition to this surcharge. Under that assumption:

So many problems, where to start? Oh yeah: the idea of a blanket fee. Unable to target individuals efficiently, and tired of shooting in the dark, the RIAA now says, effectively, “kill them all and let god sort them out.” Charge everyone for the music, whether they download or not; essentially, the RIAA will get their very own federal tax.

Now, you could argue that stuff like this already happens; you pay more for items at stores as a way to cover losses to shoplifting. But at least the stores do this in-house; they don’t ask the oil companies to add a surcharge to gasoline sales on the idea that shoplifters use their cars to get to the stores. A more consistent model would be to add to the price of music sales to offset losses to piracy. Maybe the RIAA doesn’t want to do this because they know that the music they sell is already vastly overpriced. Just as likely is that they know it would dampen sales, whereas a surcharge on ISP services would only dampen the ISPs’ sales.

And we’re talking about huge fees generated. At $5 per ISP contract per month, with about 90 million U.S. households online, the RIAA would get a nice $5.4 billion bonus on top of all the music they sell each year. Cover most industrialized nations, and we’re talking many tens of billions of dollars the RIAA “earns” just for waking up in the morning. Brilliant! And all this without any evidence that they’re actually losing any money to file sharing–and actually some evidence that file sharing is actually generating revenue for them. Even if you believe they do lose money, it can’t even come close to that much money.

The Wired article actually legitimizes this approach somewhat:

The idea is controversial but — as Griffin and Jenner point out — hardly without precedent. The concept of collecting a fee for unauthorized use of music was developed in France in 1851 as a way of reimbursing composers whose work was being performed without their permission in cafes and the like.

The practice spread to the United States in 1914 and currently applies to radio airplay and webcasts in addition to live performances. In a 2004 white paper, the Electronic Frontier Foundation called for it to be applied to file sharing, but the Recording Industry Association of America immediately dismissed the proposal.

Either the writer of the story was just regurgitating what the RIAA was feeding him without checking it out, or he was simply poorly informed. The EFF white paper suggested something somewhat different from what is being suggested by the RIAA today. That 2004 white paper proposed a system in which individual file sharers could pony up $5 a month and in return, they could continue their file-sharing ways unabated. Having ISPs voluntarily buy into the system was one means of doing this–but the key point was that in return for the fee, all customers could then legally download all the music they wanted. As I mentioned above, I see no reference to this in the RIAA’s current proposal; instead, they simply push their idea as an additional compensation for pirated music only, not a blanket subscription-fee service. As for the radio fees, those were applied only to specific businesses who used the product–it was not applied indiscriminately as a tax. Unless I am mistaken, radio stations that do not broadcast music don’t pay the fee. (Could someone confirm that, please?)

The idea of having ISPs collect revenue for the RIAA seems a bit much to ask. Music is not all that is downloaded; if enforced by law, you would have the movie and TV producers, software developers, e-book vendors, and may other parties suddenly claiming they were losing billions to pirating and demanding additional fees be added to the ISPs’ prices until the fees became ridiculously high.

There is one precedent I can think of for this kind of idea: in Canada, a surcharge is added to media players and blank recording media and the money distributed to the music industry and artists; in fact, Canada has recently started to consider the $5/mo. ISP fee, but in exchange for making file-sharing legal.

The actual precedent in making up for revenues lost to theft is crystal clear: costs are added to the specific product stolen, or else added to the prices in the specific vendor’s venue. If the RIAA wants to jack up their own prices to compensate for this, then fine. If the RIAA wants to offer everyone a $5 per month subscription fee for accessing all the music they want, also fine. But to force every user of the Internet to pony up $5 a month, indefinitely, on the unfounded basis that the music industry is losing money it cannot even come close to proving it is actually losing, and to do so while insisting that these same people still pay full price for their music on top of this… like I said, that would be a fantastic deal for the music industry. But realistically, it is a stupid idea with little precedent and no rational justification.

Here’s a different view, by the way:

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Filed under: Corporate World,
Written by Luis at 10:48 am | Just one comment so far
 

March 2, 2008
They Just Don’t Get It

Here’s the latest genius masterstroke from the networks:

Looking to strike a blow against the proliferation of digital video recorders, the ABC network, its affiliated broadcast stations, and Cox Communications’ cable systems are establishing an on-demand video service that would allow viewers to watch ABC shows like “Lost” and “Desperate Housewives” any time they choose.

The catch: It uses a new technology that disables the viewers’ ability to fast-forward through commercials. …

ABC and Cox executives said that consumer response to the test had been positive. Several executives involved in the project, which ABC plans to offer to other cable systems around the country, said the move was an overt attempt to staunch the use of DVRs like TiVo, which viewers often use to avoid commercials. That activity is increasingly seen as threat to broadcast television, which depends on ad revenue to pay for programs.

“This does counter the DVR,” said Anne Sweeney, the president of the Disney-ABC television group. “You don’t need TiVo if you have fast-forward-disabled video on demand. It gives you the same opportunity to catch up to your favorite shows.”

So, to quote Maxwell Smart’s various and sundry opponents, exactly what kind of idiots do they think we are? “Hmm, I have this DVR sitting right here and can record the TV show in high-def and can blow through all the commercials… or I can wait a few days, and then slowly download a lower-res, DRM-studded version of the show that I have to watch on my PC with the fast-forward disabled, forcing me to watch commercials.”

Easy choice! Since I’m a complete and utter moron, I’ll watch the downloadable version!

They just don’t get it, do they? The networks, I mean. They seem to think that these various schemes they keep on coming up with will somehow just destroy people’s ability to think rationally and decide to do what is in their best interests. Now, if they were Republicans, maybe they’d be a lot more skilled at it. Unfortunately, studio and network executives aren’t running the GOP, otherwise Bush would have certainly lost four years ago. Instead, their stupidity is wasted on these Quixotic, worthless attempts to bypass the far more appealing alternatives that average viewers can clearly see are better for them.

I have said it before: there is only one way this can work out to the content providers’ benefit: narrowcasting.

What they have to do is give up the old-school thinking of doing things in broadcast mode and switch to delivering personalized content. The pay-as-you-go method of making people pay $2 to watch a TV show they’re used to getting for free just ain’t gonna cut it with 95% of the audience. And people are now too used to being able to cut through commercials or otherwise getting past the dreck that is advertising. 97% of the audience isn’t expected to watch or be interested in commercials anyway–it’s just getting that 3% who happen to be interested in the commercial being shown at the moment which is key. And there is only one solution that is really going to work in a big way.

Here’s the condensed version: make all video content available online–all old movies and TV shows, as well as new television series episodes as they are produced. Make it so people can browse an iTunes-like interface and easily choose which programming they’d like. Then stream it to them, or download in higher definition, whatever works best.

But here’s the key: personalize the commercials. Don’t broadcast, narrowcast. You’ll have to find out what people want to see, so instead of charging money, you have people answer some questions once a month. They have to say what kind of commercials they like to see, want to see. What will they be buying in the next month? What subjects are they interested in?

One thing we all have in common is that there are commercials we like to see. For me, if all my commercials were movie previews, computer commercials, and commercials for stuff I plan to buy in the near future (local wedding chapels is one, in my case, or ideas for what to buy Sachi for her birthday)–then I would want to watch the commercial breaks.

Knowing that I would have to watch commercials, I would be OK so long as the commercials were ones I wanted to see. And I would be glad to give up that info to get access to all the programming I’d like to watch. Privacy, schmivacy–most people give up that data in exchange for a member’s card at their local supermarket and a two-dollar discount on three refrigerator packs of Diet Coke.

This would be golden for the advertisers: instead of reaching only 3% of the audience, they’d be reaching over 90% in all likelihood–30 times the value. The studios could even eliminate the middleman in the form of local stations, and make off like bandits. The advertisers would be happy, the viewers would be happy, and the studios would get rich.

It’ll take bigger investment in broadband, which is overdue anyway, and details would have to be worked out to salvage DVD sales. Maybe offer the downloadable stuff in 480i old-fashioned TV quality, and then sell DVDs of the shows in Blu-ray with the extra features and commentary–they’ve probably already mined out most of the 480i DVD sales anyway.

However they figure that out, the narrowcasting option is the only viable option that I can see. Frankly, whenever I see one of these stupid, lame attempts by the networks to “do away with” DVRs or pirate downloads or whatever, I just laugh. They are all pathetic and doomed, and clearly so.

When are they going to learn?

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Written by Luis at 11:31 pm | No comments so far
 

February 18, 2008
The Revenge of Betamax

If you bought an HD-DVD player and/or recorder and some HD-DVD titles, then it looks like you’ve got a nice, new Betamax machine on your hands. That’s right: Toshiba has apparently thrown in the towel as Blu-ray takes the prize as the winner of the new high-capacity DVD battle.

The turn came when Warner Brothers made the switch to Blu-ray. This kind of surprised me, because over the past few years, there were all kinds of dips and turns in the battle, where each maker seemed to suffer big setbacks, but then charged back later when the tide turned. When Warner–just one studio of many–announced their switch, there was a lot of buzz that this was some momentous turn. Beats me as to why–a variety of studios had been turning this way and that for a while now, and it never seemed to change anything.

Toshiba fought back, primarily by slashing prices on their players, which had always been cheaper and had come out earlier than Blu-rays. But that didn’t seem to work. Vendor after vendor decided to go Blu-ray, until the lethal blow came with Wal-Mart deciding to drop HD-DVD. That signaled the end that had begun with Warner’s move. Toshiba has not made its formal announcement yet, but it seems pretty much set:

A source at Toshiba confirmed an earlier report by public broadcaster NHK that it was getting ready to pull the plug.

“We have entered the final stage of planning to make our exit from the next generation DVD business,” said the source, who asked not to be identified. He added that an official announcement could come as early as next week.

And here I was, figuring that it would last until somebody came up with a hybrid drive, like they did with the DVD±R/RW format. For a long time, people thought that the plus-minus wars would produce a single winner, but now everyone uses optical drives that allow for both types (although it’s getting harder and harder to find “plus” disks; “minus” seems to be the anti-climactic winner there).

Instead, everyone who bought an HD-DVD player will start to find it harder and harder to get disks to put into their machines, and eventually will have to buy a Blu-ray device.

The competition was good for at least one thing: it drove prices down a lot faster than might have happened otherwise, and spurred development and releases. Hopefully, that trend won’t slow down too much now that Sony can take a breather and relax, its dominance assured.

Oh, and guess who championed HD-DVD? Microsoft. And who picked Blu-ray from the start? Apple.

The only downside I can see: now we have to get used to a weird format naming system. Until now, it had been simple: everything was -ROM, -R, and -RW, and the initial letters made sense–CD and DVD. For some strange reason, Sony decided to go with “BD-R” and “BD-RE” for the recordable and re-writable formats. One would have expected “BR” (for Blu-Ray) to be the initial string instead of “BD” (for Blu-ray Disk), but when you think about it, that would have made the full designations “BR-R” and “BR-RW”–which sound a bit “chilly.” But “RE”? Apparently, that’s for “RE-writable,” instead of the long-used “Re-Writable” (“RW”). Why Sony changed that, beyond the desire to confuse people, is anyone’s guess.

But what really blew me away was this map:

400Px-Blu-Ray Regions With Key

Those are Blu-Ray regions, as in the DVD regions that have created so many headaches for international travelers. Just last night, I got an email from an old student who was having trouble getting American DVDs to play on his Japanese computer. That’s because Japan uses Region 2, strangely aligned with Europe, but not with America, which uses Region 1. But look at the new map: Japan and America use the same region. That means we can use American BD-videos in Japan! Which means that potentially, I could buy films from Amazon.com for movies that are only just coming out in theaters in Japan, and for a price which is less than the two movie tickets Sachi and I would have to buy here. That’s nice. (Although it should be noted that HD-DVDs were region-free–oh well.)

So, what will you be in for with a Blu-ray upgrade from your old DVD? Well, for starters, Blu-Ray has a minimum of 5 times the capacity–25 GB vs. the old DVD’s 4.7 GB (though I find a DVD-R will only take 4.3 GB when you actually want to record something). However, multi-layer discs are becoming available; you can buy 50 GB Blu-rays now. There is talk about BD’s with up to 10 layers, or 250 GB of storage on a single disc. No news on when those will be out, though. Blu-Rays, having so much capacity, will take longer to write; currently, it’s supposed to take a half hour to burn a 25 GB BD-R with the fastest available writer.

Blu-ray movie discs should have a more powerful and varied interface, allowing for more features the user can control. Let’s just hope they did away with that idiotic you-can’t-skip-past-these-ads “feature.” BD’s also sport a much thinner but tougher plastic coating, supposedly resistant even to scrubbing with steel wool.

So, should you buy your Blu-ray today? As always with computer equipment, it depends–future equipment will always be cheaper and/or have more features. Drives bought today might not be able to handle higher-capacity discs released in future years. On the other hand, optical disc drives do have a tendency to crap out after a few years of steady use; there’s no telling how long the new machines may last. And by the time those better-featured machines come out, prices may have dropped to a level where you might not mind buying a new machine so much.

Me, I’ll have to wait until I get a Hi-def TV. However, they do sell Blu-ray drives for computers, and I do have this nice, big, HD-ready 24-inch iMac screen… but looking at what Yodobashi Camera is selling, their cheaper units seem to only work with Windows PCs–ironic, since Apple supports the Blu-ray format, and Microsoft went HD-DVD. Figures.

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Written by Luis at 9:24 am | Just one comment so far
 

February 7, 2008
RIAA: We’re Hypocrites, and Don’t Mind Showing It If It Can Make Us a Quick Buck

You know how the RIAA whines about how downloading music of the Internet is really hurting the artists? How it’s not so much about the greedy, parasitic corporate suits as it is about the struggling, bona-fide musicians who are just trying to get by–except for all you lousy, stinking criminals who keep stealing their music and taking food out of starving artists’ mouths? And so forth and yadda yadda yadda.

Well, despite the fact that the musicians do all the work, spilling their hearts into the music, writing and arranging and performing, the RIAA pays them a pittance–and now wants to cut that even further. Despite the fact that digital downloads and digital streaming costs far less to distribute than traditional CDs, the RIAA thinks that current royalties paid for a music track (now at 9 cents) is much too high. They want to pay less than that. For a downloaded track, the songwriters are asking for 15 cents; the RIAA wants to cut the current rate by about half, down to 5 cents.

For streaming music–aka Internet radio–the artists want 12.5% of the money made. The RIAA: take 0.6% and be happy with our extreme generosity. Why? Because, they say, streaming music is like radio and artists don’t deserve any of that revenue. Which is full of it, because radio doesn’t pay, last I checked, while streaming music now does. The RIAA wants all the money made from streaming music, and wants to give the artists squat.

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Written by Luis at 10:32 pm | 2 comments so far
 

January 20, 2008
Domain Name Blackmail

Whatever you do, never use the domain name registrar Network Solutions, ever. If they are your registrar for any domain names now, then immediately pull your business from them, and get your names registered with another registrar, like GoDaddy. A policy Network Solutions enacted in just the past few weeks showed them up to be predatory, unethical, and downright anti-consumer.

In short: when you do a search for a domain name on Network Solution’s web site, they claim the name for themselves and force you to pay them more than three times what the competition charges, or else risk losing the name to cybersquatters.

Although it’s been in the news over the past few weeks, I had not heard of the controversy. I got wind of it today, when my father told me that he’d fallen into their little trap. A family friend needed help getting a domain name, and together they came up with the perfect name–the only name, in fact, that they felt would be good for the situation. He went to Network Solution’s web site to see if it was available. The web site informed him that it was available for purchase–but prices for other dot-com domains were listed for $15 on the page, so he assumed that was the price (actually, that also is misleading–the domains are “from” $15, and most are $35) and went to GoDaddy to see if he could get a lower price. To his surprise, GoDaddy informed him that the domain name was taken. When he did a “WhoIs” search, he discovered that Network Solutions had reserved the domain name, blocking any purchase from anywhere except Network Solutions. If he went to their site, the domain name was listed as “available.”

It turns out that there is a new twist in cybersquatting, called “frontrunning.” Apparently, cybersquatters have worked out ways to see what domain names people are enquiring about on services like Network Solutions and GoDaddy. When they see that there is interest in a name they deem worthwhile, they will move in and snap it up before the person who originally searched for it can make up their minds.

What Network Solutions claims it is doing is protecting people from the frontrunners: when someone searches for a domain name, they put a 4-day hold on it. The idea is that frontrunners would be foiled from snatching it up. That’s the claim, in any case.

And, as it turns out, the claim is completely bogus. Network Solutions is doing nothing but blackmailing consumers into buying the domain name from them, and nobody else. How can we tell? My father and I did a little experiment: we ginned up a domain name that we didn’t really want, and I searched for it at GoDaddy: name available! For $10/year.

Picture 7

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I then searched for the same name at Network Solutions: name available!

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I went back to search for it again at GoDaddy: Sorry, that name is taken.

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We did a WhoIs search: Network Solutions has taken that name.

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But the key was to do one final search: while I had done the original search, my father–not only on a different computer, but from a different continent–searched for it on Network Solutions: that domain name is available!

In other words, anyone could get that domain name–but only from Network Solutions, and only for $35–more than three times what GoDaddy charges.

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How does this protect you from Frontrunners? Not at all; they could buy the domain name if they wanted, from Network Solutions. In fact, the block on the name helps the Frontrunners–if you decide to wait four days for the domain name to become open again, that give the cybersquatters that much more time to grab it out from under you.

In other words, if you are afraid that someone else might grab the domain name you want, then you are essentially blackmailed into paying steep prices to buy it from Network Solutions.

Network Solutions does not even tell you about the 4-day lock before you do a search. A week ago, they claimed they would add that to their web site–something that would take only minutes to add–and yet no warning appears today when you do a domain name search.

Network Solutions claims that they “hide” the data from frontrunners, but when the WhoIs search actually advertises that the name was searched for and held by Network Solutions, their claim falls apart as an utter crock. In fact, until just a few days ago, Network Solutions would actually go so far as putting a billboard ad for themselves on the domain name someone searched for, calling out for other people to snap up that domain name! Yeah, sure, they’re doing a great job of “hiding” that information. And up until last week, they were putting holds on domain names that people checked out under WhoIs searches–not even asking on their web site.

Now, if they allowed customers the option of a domain name lock for four days so that only they could purchase the domain name, that might be a different story. But that’s not what Network Solutions did. Instead, they decided on a policy that essentially tricks people into divulging their original ideas for names, and them blackmails them to pay usurious prices, fast, or risk losing their idea to cybersquatters.

Scummy. Really scummy. I believe in sending businesses a signal. I will never touch Network Solutions as a registrar (luckily, I never did before), and I urge everyone else to do the same. If you have domains registered with them, then leave. Get out. A company that treats potential customers like that is bound to burn you, sooner or later.

Update: My father says he called Network Solutions and asked them to release the domain name he’d searched for, the one he and the family friend needed–and Network Solutions freed the domain name. Which is great for my dad and our friend, but is another bit of proof that Network Solutions isn’t trying to stop frontrunners. They had no proof whatsoever that my dad was not a frontrunner himself; they just released the domain at his request.

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Written by Luis at 12:15 am | 22 comments so far
 

December 25, 2007
RIAA Follows Bush Administration Example, Plants Fake News Story

Is this the new version of the press release? You may not even be aware of the print version, in fact: many “news” stories are simply word-for-word reprints of text press releases, essentially ads put out by organizations in the form of a news story. Usually they announce some new product, an event, or an organization’s position on a news-related story–something that resembles news more than it does an ordinary ad. But it’s still an ad. A lot of people read them and don’t know that they come directly from an interested party, some business or other organization that has a stake in influencing people’s views.

And that’s the problem: people usually accept news reports as being unbiased, as coming from an uninterested source, giving an objective view. Press releases are the exact opposite of that. That some news organizations reprint this word for word, especially when they do it without any disclosure about the source of the “story,” is contrary to the idea of objective journalistic practice.

A new version of this seems to be the “video press release”–a short insert for TV programs or even web sites, disguised as a news report. Done in the same format (or close to it), it can be dropped into any TV show or web site and appear to be a regular news story. It may have preceded the Bush administration, but Bush certainly made extended use of it–especially the type that tries to hide its biased source and fool people into thinking that it’s a real reporter. This is even worse than the text press release, because people are less familiar with the fact that these even exist, and they are less likely to have some disclosure about where they came from.

Well, not surprisingly, now the RIAA has jumped onto the wagon, and has their own fake news “video press release” out--which, of course, does not identify itself as coming from the RIAA. It has all the usual RIAA claims, like the canard that piracy costs the industry billions, but it goes further, trashing pirated copies as having “atrocious” quality, and then quietly segues into full-commercial mode, suggesting “cool, innovative ways to get your favorite music,” such as buying Christmas-themed ringtones.

Ah, yes–nothing says “I got the perfect gift for you” like paying two and a half bucks for a shortened version of a song you already paid a dollar for, especially when it’s a song that is only usable on a cell phone for one month out of the year–and most people would find “atrocious” even in that case.

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Filed under: Corporate World,
Written by Luis at 3:28 am | 2 comments so far
 

November 21, 2007
RIAA, MPAA Urge Presidential Candidates to Uphold Copyright Fascism

Via CNet News:

A coalition of entertainment and publishing industry heavyweights would like to see the 2008 presidential candidates champion “meaningful copyright protection” in their policy platforms. …

In a conference call with reporters Tuesday afternoon, Ross said the group also intends to hold briefings with presidential campaigns about its copyright priorities, but it’s not “in the endorsement game,” although individual alliance members may choose to take that step.

Here’s the pledge that I would like to hear the candidates make concerning copyright:

“I pledge that my campaign will take a firm stance on copyright infringement; that, where the constitution and the law require and permit, those who violate the law will be held responsible for their actions.

”I also pledge that copyright law will be revised in a manner that is far more compliant with personal creativity, and less with an eye toward the eternal profits of non-person corporations. The idea of a corporation having the same rights and powers of a human being is offensive to me, as it should be to all people who take the concepts of humanity and personal responsibility seriously. Copyrights are intended to stimulate creativity, not line the pockets of shareholders and executives who do not create anything but more money for themselves. Current copyright limits are the life of the author plus either 50 or 70 years, but that number is continuously extended to protect the profits of the corporations owning those copyrights, and are not in any way intended to encourage new creations.

“For this reason, I shall sponsor and support legislation that will restrict copyright protection solely to the individuals who create; these individuals may lease their copyright holdings to businesses, such as corporations, for a period of time not to exceed twenty years beyond the act of creation. The reason: to stimulate creativity and public knowledge by enriching the public domain, allowing more universal access to all works of art and information, unrestricted by cost or other legal impediments. This not only allows a sufficient time for the original artists to collect on their creations, but adds stimulus to corporations–who might otherwise rest on profits from already-created work–to pay artists to create even more to generate more profits for themselves.

”I also pledge to strengthen laws concerning ‘Fair Use,’ as well as the personal use of legally-purchased intellectual property. I shall sponsor and support legislation allowing anyone who has purchased a work of art or information to use and enjoy that product in any and all forms that the individual pleases, and forbidding the sellers to prevent or limit the right of the individual to do so in any way, shape, or form.

“I further pledge that I will fight to the extent of my ability to maintain the law, including where it applies to arbitrary and blind lawsuits that attack broad swaths of our citizenry in the hopes of either extorting money as the end result of nuisance suits, or which attempt to ferret out potential civil suit awards by indicting large numbers of people, despite the knowledge that many or most of those people are innocent of any wrongdoing.”

Such a pledge would be a true “commitment to creativity” that the media suits talk about but clearly do not intend.

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Written by Luis at 10:58 pm | 5 comments so far
 

November 8, 2007
Blame Jobs

Former Disney studio head Michael Eisner says that writers are stupid to strike against the industry and to ask for a cut of digital sales:

The problem, Eisner said, is that the Writer’s Guild is lobbying for a bigger cut of the profits from digital distribution–and according to the former Disney chief, those profits simply aren’t there.

Gee whiz, where have we heard that before? It’s practically a mantra with the studios. This was portrayed pretty well on last weekend’s SNL, on Weekend Update, where a “Studio Head” talked about an end to studio profits:

Studio Head: DVDs and the Internet have put an end to all that. You know what it costs to make a DVD? Sixty cents. You know how much we charge? Twenty-nine dollars. And the writers want a bigger piece of the profit. What profit??? You know, we asked our accountants to figure out what twenty-nine dollars minus sixty cents is, and you know what they came up with?

Amy: Twenty-eight forty?

Studio Head: Negative thirteen dollars.

If that sounds like exaggeration, just take a look at Forrest Gump. Winston Groom wrote the novel, and made a deal with the studios to get 3% of the net profit. Not the gross, which is everything the film takes in, but the net, which is what’s left over after costs have been deducted. Tom Hanks and Robert Zemeckis got cuts of the gross, and made something like $40 million apiece.

The budget was estimated at about $55 million. It made $330 million domestically, and had worldwide ticket sales of $661 million. That’s before even DVD sales. And yet at that point, Paramount claimed that the movie was $60 million in the red. Somehow costs of $55 million became costs of $720 million. The studios, however, graciously admitted that “someday” the film would show a profit, and so “advanced” Groom a quarter of a million dollars to show their good will. This is commonly known as “Hollywood accounting”; many more examples can be found here.

So what is the new pitch? How come the movie studios aren’t making anything new off of Internet sales of TV and movies?

Blame Steve Jobs. According to Eisner, he’s the baddie:

Eisner, a well-known critic of Apple (whose CEO, Steve Jobs, is a powerful member of Disney’s board of directors), suggested that the profits may be getting sucked up elsewhere. The studios “make deals with Steve Jobs, who takes them to the cleaners. They make all these kinds of things, and who’s making money? Apple! They should get a piece of Apple. If I was a union, I’d be striking up wherever he is.”

Okay, two things. First of all, Apple makes most of its profits from sales of hardware like the iPod. I seriously doubt that they get much more a cut of retail sales than any distributor. And second, what Eisner is effectively saying here is that writers should be angry at Jobs for being a smart businessman, and not at the studio heads who bargained away all of their profits. Somehow that makes the writers “stupid” and the studio heads blameless–assuming that again, Eisner isn’t lying his ass off.

But that’s the problem with Eisner or anyone else who represents the studios. They are well known for being habitual, if not obsessive liars when it comes to profits. You do that, it may get you more money in the short run, but in the end, no one believes a word you’re saying, and simply assumes that everything coming out of your mouth is a self-serving lie.

Which it probably is.

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Written by Luis at 8:58 am | Just one comment so far
 

October 7, 2007
Equilibrium

An interesting point from Michael Arrington via Blackfriar’s Marketing:

The economics of recorded music are fairly simple. Marginal production costs are zero: Like software, it doesn’t cost anything to produce another digital copy that is just as good as the original as soon as the first copy exists, and anyone can create those copies (meaning there is perfect competition and zero barriers to entry).

That’s an excellent point concerning “intellectual property”: so long as it is sold electronically, so that not even distribution or packaging costs come in, the cost of production is close to zero. Now, with software, there is a mitigating factor: the cost of producing the original, which can be pretty damned high in some cases, and so the cost must be offset by multiple sales and/or high pricing.

Music, on the other hand, costs somewhat less to produce. Yes, costs for studio recording and so forth can be fairly high, but in the end, the average song must cost far less to produce than the average software package churned out by a company.

In the past, there was more respect for the costs of intellectual property because of the physical nature of the product; there was a book, a record, a CD–some physical product that had to be manufactured, and held in one’s hand. A consumer could feel they were getting value, or additional value, because of this. With electronic transmission–a very new development–that physical component no longer needs to matter.

And so producers suddenly have a commodity that can be reproduced at zero cost and costs nothing to distribute. The problem is, they still expect to price and police the system as if there were a physical product involved. And that’s where part of the intellectual disconnect comes in.

Imagine that a farmer who sells oranges suddenly finds that a machine has been made that can take an orange and reproduce it at zero cost. Initially he is ecstatic, as he sees his production costs fall drastically, but he can still charge as much for the product as he did when he grew each orange from the soil.

Then the technology for replicating oranges falls into the hands of his customers, and they no longer need the farmer after the first orange is produced.

True, the analogy is not perfect; software and songs are not oranges in that each product is unique; one will not simply get one piece of software or one song and then reproduce it forever. But there is enough to the analogy to realize that new technology requires new paradigms for the marketplace. Piracy and the RIAA/MPAA’s reaction to them are part of the process of coming to a new equilibrium.

The content owners are fighting like mad to maintain the old system, and keeping all the gains of technology for themselves; they use their money, power, and influence in government circles to win this battle.

Piracy is the consumer’s reaction, essentially saying, “Oh, no you don’t!” and often going to the other extreme, trying to claim all the benefits of the new technology for themselves; they use their numbers, anonymity, and civil rights legislation to fight their side.

Coming to a settlement will, like all settlements, involve both extremes to agree to a place that neither likes. Where that settlement will land is anyone’s guess right now.

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October 5, 2007
A Giant Step in the Wrong Direction

This is pretty amazing, and galling. A jury in Minnesota (Motto: “We’re the New Montana”) decided that a woman they claimed pirated music must the RIAA $9,250 per song, for a total of $222,000.

Among the amazing aspects of this case:

  • The RIAA did not have to prove that the defendant illegally downloaded any music
  • The RIAA did not have to prove that the defendant was the person who pirated the music
  • The RIAA did not have to prove that anyone downloaded the music, only that it was available for download

The RIAA in the past has said that each downloaded song should be penalized with $750, although they graciously accept $3000 quickie settlements from people they send semi-random threats to. Where the jury came up with $9,250 is a mystery. The jury refused to talk to the press as they left.

Either the defense lawyer was incompetent, or the judge was, or the jury was stupid. Or maybe a mix of all three. This is pretty astonishing. Needless to say, it was an easy case for the RIAA to win considering all of its aspects (especially the jury instructions), and the RIAA will doubtlessly try to apply the victory prejudicially over all of its future litigation actions, no matter what the differences.

To give you a picture of what the jury apparently bought into, Sony BMG lawyer Jennifer Pariser claimed that even ripping a music CD to your computer or making a backup copy was stealing, despite the fact that the law says the exact opposite. The RIAA also laid out all of their usual “we’re losing billions of dollars” fiction which has been repudiated by any research not paid for by the RIAA.

The RIAA also played dirty by claiming that the defendant had her hard drive replaced to destroy evidence, despite the fact that the replacement took place before the RIAA first contacted her.

I don’t know. Maybe the defendant was just completely unbelievable in her testimony. Maybe the plaintiffs put their massive legal resources to work and razzle-dazzled the courtroom.

The end result is, thanks to this jury, the RIAA is now completely emboldened, and now has a court-established precedent that works in its favor. The only hope is that this whole case can be appealed and won on appeal, based upon the questionable jury instructions–the judge told the jury that it was not necessary to find that the defendant had actually committed the infringement that she was being sued for.

One could call that a wee bit contentious.

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Written by Luis at 9:52 am | 3 comments so far
 

September 21, 2007
NBC Doesn’t Really Get It

After having skipped out of Apple’s iTunes Store, NBC seems to be flailing about a bit. They signed on to sell their shows on Amazon.com’s video sales service, and now have announced another “free” download service that is ad- and DRM-laden.

The Amazon.com Unbox service seems to be the most reasonable; it allows for more flexible pricing, which the networks of course desire. However, it is also restricted; it requires Microsoft’s “PlaysForSure” DRM software–something also desired by NBC and other content providers–which pretty drastically limits viewing abilities. You can’t play the video unless you’re running Windows or opt for the TiVo option. The video cannot be played on iPods or even Zunes.

The “NBC Direct” route is set up to be a disaster. Not only is it so heavily restricted that you can only play it on NBC’s proprietary software and can’t use it on anything but a Windows PC, but it carries ads which cannot be skipped. Sure, it’s free, but so long as you’re allowing ads into it, why be so stupid as to watch it on NBC’s player where you can’t skip them? Why not just tape or TiVo the show? The “NBC Direct” idea is completely nonsensical.

Part of the reason NBC left Apple was over pricing. Apple claims NBC wanted to charge as high as $5, and other reports suggest that Apple wanted to lower the price on all TV shows to $1. Probably the NBC suggestion of $5, if it happened, was less a serious proposal and more an idea thrown out there. And I can certainly see content providers wanting to set their own prices.

The thing is, Steve Jobs is no idiot, and NBC would be well-advised to listen to him. Sure, he gets money from iPod sales, demands large profit margins for his own products, and does not lose money if the margin on TV shows sold on the iTS is slashed. I will give you all of those.

Nevertheless, Jobs is one of the best marketers around, and he stands to profit by selling more and more and more of NBC’s content. And more often than most people in the business, Jobs has been right. Case in point: music sales on the iTS. It’s wildly successful. But remember how the music labels had to be dragged, kicking and screaming, into allowing for $1 song sales and no tiered pricing? Well, the iTS has been a rousing success, having sold more than 3 billion tracks in 4 years–over half of which sales occurred in the last one year–capturing 88% of the music download market, becoming one of the biggest outlets for music sales.

Like I said, Jobs is not an idiot. And selling TV shows for $1 apiece is similarly very astute. A lot of people have downloaded TV shows at the $2 price, but that can be sustained for only so long and at only so high a rate. Most people will begin to realize that at the end of a season of shows, they have only the shows to own, and they have shelled out between $40 to $48, depending on how many episodes there are in a season. In the meantime, the networks release the DVD set very soon after the TV broadcast ends, and one can own the whole season at higher quality, with all kinds of extras an add-ons, for less money. Payment for one is not transferable to another–you can’t apply the $46 you paid for season 1 of Heroes to the $40 price of the DVD box set. And if you want to watch the show in your iPod or other handheld player, you are limited to downloading via BitTorrent or another service, though you might have to process the file to squeeze it into a format the player can handle.

Yes, that fits nicely with the network paradigm of making viewers pay multiple times for the same content. But enough viewers are not stupid enough to make this a big seller. Jobs has the right idea: price the bare-bones, lower-quality version for lower, and people might go for the double-purchase a lot more easily. After all, $23 doesn’t seem quite so bad a price to pay for having immediate, portable, commercial-free access to a whole season of shows while you’re waiting for the feature-rich, expanded DVD box set to be released. A lot more people would go for that, and NBC would make a lot more money. In the meantime, a lot more people are instead turning to BitTorrent.

Here’s an even more radical idea: make the downloaded versions into the equivalent of a boxed DVD set. Offer the extra versions as extra downloads included in the price of a season pass. You can raise the price because you are essentially selling the DVD box set plus the ability to get it delivered a lot earlier, as the episodes air. Instead of $40 for the box set, sell the season pass equivalent for $50. That would represent a lower profit margin, but I bet increased sales would make up for it–and you would cut out the crowd who only buy one or the other but not both.

But here’s the biggest idea: drop the frakking DRM. Jobs was dead right earlier this year when he said that DRM was stupid. It is. It does not stop piracy one bit–in fact, it encourages piracy. Why? Because if you pay for the video, you have all these restrictions and roadblocks and limitations; if you download it for free, there is absolutely no restriction on what you can do with the file. DRM does not even slow pirates down, and it punishes paying customers. Why NBC and other content providers fail to see this glaringly obvious point is beyond me. Remove the DRM, and sales will rise, piracy will suffer. What is with these idiots at the studios?

In the meantime, if you aren’t in the BitTorrent crowd, expect to pay higher prices multiple times, and face higher obstacles to viewing where and when and how you like.

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Written by Luis at 12:09 pm | No comments so far
 

September 10, 2007
Yes, Let’s Trust These People

Last month, I discovered how a web host could come close to shutting you down because your site uses more server resources than it is supposed to. In fact, that wasn’t my doing–it was a combination of hotlinkers, image search engines, and spammers all hitting my site at once. But at least the web host contacted me with specific guidelines about what was going on, what levels of use were acceptable, and general guidelines as to how to achieve those goals.

It seems that in the U.S., the Telecoms are starting to crack down on users for using their Internet connections “too much.” The punch line: they won’t tell customers how much “too much” is.

Comcast has punished some transgressors by cutting off their Internet service, arguing that excessive downloaders hog Internet capacity and slow down the network for other customers. The company declines to reveal its download limits.

“You have no way of knowing how much is too much,” said Sandra Spalletta of Rockville, whose Internet service was suspended in March after Comcast sent her a letter warning that she and her teenage son were using too much bandwidth. They cut back on downloads but were still disconnected. She said the company would not tell her how to monitor their bandwidth use in order to comply with the limits.

“You want to think you can rely on your home Internet service and not wake up one morning to find it turned off,” said Spalletta, who filed a complaint with the Montgomery County Office of Cable and Communication Services. “I thought it was unlimited service.”

It looks like we’re talking about Internet over cable TV lines, where bandwidth is shared between many homes in a neighborhood. A few users could potentially be using huge amounts of bandwidth and spoiling things for their neighbors.

However, the real crock here is that Comcast is refusing to specify what the bandwidth limits are. The article does not state what Comcast advertises when it sells the product, or what is specified in contracts about bandwidth use. But they do note:

Companies have argued that if strict limits were disclosed, customers would use as much capacity as possible without tipping the scale, causing networks to slow to a crawl.

Frankly, I find that hard to believe. Companies almost always advertise a certain speed for their service, and cable companies are well-known for advertising limits far beyond what can reasonably be accessed–you sign up for a service touted to be 10 Mbps, but find you’re not able to get better than 1 Mbps.

But not specifying the cutoff point, where you could lose your service entirely? Imagine that the electric company calls you and tells you, “you’re using too much electricity; stop that or we’ll shut your power off.” And when you ask how much you should cut or how to do it, they say they can’t tell you. What are you supposed to do? The only way to be safe is to almost stop using power except for the bare essentials.

I am not a computer engineer, but I imagine that it would not be very difficult or expensive to install a bandwidth choker in homes that abused bandwidth limits. After all, there are Ethernet hubs which cut off at 10 Mbps, and they can probably be produced for very cheap–less than $10, I imagine. There must be even simpler ways of restricting bandwidth–the 10BASE-T Ethernet hub is simply an example that it can be done. So why doesn’t Comcast do this instead of cutting people off?

Probably because it’s easier, and because they can.

Not to mention that some years back, Comcast and the others promised everyone high-speed, fiber-optic networks in exchange for raising their rates. We said yes, they raised their rates… and now they not only don’t have those promised networks, but they are actually cutting off customers’ service for using more than an unspecified amount of bandwidth.

These are the people we’re supposed to “trust” by abolishing Net Neutrality and giving them complete control over our Internet experience. Yeah, good idea.

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Written by Luis at 8:54 am | 3 comments so far
 

September 8, 2007
Bush Administration Accepts Bribes, Attacks Net Neutrality

Net Neutrality is an utter necessity for the Internet. It essentially says, “everyone on the web is free and equal,” and keeps Telecoms from becoming despotic tyrants who can tell you what to do, when to do it, how to do it, and how much you can pay them for the privilege.

So naturally, the Telecoms want to control the INternet. There are two major dangers: first, creating classes of Internet speeds; and second, the Telecoms will be able to dictate what programs you use for accessing the Internet.

The former would mean that you will pay more and get nothing in return. Anyone who refuses to pay Telecom tolls will get tossed into the slow lane; everyone else will have to pay for the privilege of not being slowed down. You, the consumer, will have to pay more for stuff you do on the ‘Net, or pay something that you get for free today. Telecoms say “we should get paid for what we give,” but they already do. Everyone pays for bandwidth, including Amazon, Google, YouTube, and Apple. And you. The Telecoms simply want to charge you more.

The latter would mean that you won’t have perfect freedom to use the apps you want to use. It means that if you want to use Skype, but your Telecom has latched onto the idea that they can ban Skype and force you to use their app instead, they can do that. And they will charge you money for it.

Essentially, the Telecoms are saying, “Trust us! We would never do any of those things!” When, of course, those things are the only reasons to kill off Net Neutrality. Of course they’re going to do those things.

The Telecoms insist that they would never censor free speech, which might also be possible if Net Neutrality were killed off. A red herring–while some complain that this might happen, it is the least of the complaints. Few believe that the Telecoms would shut off free speech when they can make money off of it instead.

Anyway, the Democrats generally support Net Neutrality, and were instrumental in keeping Republicans from killing it off last year.

Not having the GOP in Congress to do their bidding, the Telecoms have turned to the last bastion of Republican power: the White House. And as the loyally-bought politicians that they are, they have delivered: the Bush Department of Justice has delivered an Ex Parte Finding which could have been written by the Telecoms themselves–and probably was. It makes all of their lame arguments, chief among them that Net Neutrality prevents Telecoms from charging for services, and using that money to improve services and provide new high-bandwidth connections.

Which is BS, of course–they will have absolutely no obligation at all to deliver squat in exchange for killing off Net Neutrality and essentially making the Internet their private money farm. And they won’t. Just like when they promised several years ago to improve services and provide high-bandwidth connections in exchange for raising their rates. We allowed them to raise their rates, and they blew us off when it came to improving services.

The DoJ “finding” is nothing more than pure Telecom warmed-over lies, and will result in nothing but the loss of what makes the Internet valuable.

Freedom and equality is what built the Internet and made it strong. Private Enterprise with rules and control is what we had with the “Online Services” of the early 90’s, like Prodigy and CompuServe–remember when you had to pay 25 cents per email? If that had remained the rule, do you think there would have been an Internet boom? Hell, no.

But apparently the Telecoms feel that now, people are addicted to the Internet, and they can charge anything they like and people will pay.

And the Bush administration is happy to whore for them.

Here’s a fact: we already pay full price for what we get. The Telecoms will not give us anything in exchange for Net Neutrality except price hikes. And killing off Net Neutrality is nothing short of taking a public resource and giftwrapping it for giant corporations to exploit–like those public lands we all own which are given to energy companies to mine and drill and then not even pay the miniscule pittance the politicians pretend to charge them for it.

So go