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The first day of the TED conference was a full one. It was a chance to catch up with old friends and meet some amazing new people, and to hear a number of interesting talks, all of which I hope to write about later. The two high points of the day were neuroscientist Jill Bolt Taylor talking about her stroke and Robin Williams impromptu stand-up.
I got a few pictures from my Nokia N95 which I put here.
UPDATE: You can play the video here.
There was a standing-room only crowd in the Ames Courtroom
at the
for today’s en banc hearing of the
FCC on Broadband Management Practices.
As
Markey made a opening speech in which he reminded the audience and the commission that "the Internet is as much mine and yours as it is Verizon’s, AT&T’s or Comcast’s." His prepared remarks are here, including a call for more competition in which he said “We want to look back years from now and be able to celebrate that this is No Country for Old Bandwidth." He remarked that he thought that was the most appropriate Oscar reference, certainly better for today’s academic deliberations than “There Will Be Blood.”
Most of the testimony and discussion revolved around what kind of bandwidth management practices were reasonable, exactly what Comcast did, what authority the FCC had to regulate network operators, and what was the best policy to promote broadband in the US.
The issue of transparency surfaced repeatedly. Commissioner Michael Copps accused Comcast and other network operators of making management decisions "in a black box" and recalled an old Washington adage that “decisions made without you are usually decisions made against you.” He lumped the Comcast actions together with other cases where operators had refused to make SMS short codes available to controversial causes or censored a web broadcast critical of Bush's stance on Iraq.
The general tone of the Commission, even before any of the testimony, was that there were definite limits on how a network operator could restrict it's subscribers access. Several of the commissioners made reference to the commission's previous adoption of four freedoms for Internet consumers:
The first witness was Gilles BianRosa of Vuze,
Inc. Vuze uses a BitTorrent client to deliver video content licensed from its 150 partners. BianRosa said that there have been 20,000,000 downloads of the application to date. He described what he called a "cat and mouse game" with Comcast in which his subscribers had problems getting content but Comcast denied having done anything. He allowed as to how Comcast was entitled to manage their network but suggested that their motives went beyond maintaining the quality of the network and were really a form of unfair competition. As he said, Comcast was running a horse race in which it owned both the race track and a horse in the race. He said he was willing to let the market decide but that markets only function of there are rules. He also said he was willing to work with any reasonable management scheme, but that was difficult when the network operators were not forthcoming about what they were doing.
David L. Cohen of Comcast said it was a pleasure to be there as a participant but "hopefully not as the main course of the meal." In what Chairman Martin later told me was Comcast's first on-record admission that they had been doing any filtering Cohen said they were using "this one tool" and only in periods of heavy traffic, in only those geographies impacted by such traffic, and only until such time as the congestion is alleviated. He said what they were doing was delaying packets "for only a few seconds" and only in the upload direction, something he said would cause BitTorrent to send its traffic to less congested nodes. He allowed as to how this action would be "almost imperceptable to customers" - something that BianRosa and others disputed.
As the other witnesses testified and the commission asked questions, it was clear that there were legitimate reasons for Comcast to manage traffic, but the general consensus was that needed to be done in an open and above-board manner.
At the end of the morning's session, the Martin asked Comcast and Verizon if they thought the Commission had the authority to regulate how the operators managed their networks or if they agreed with Congressman Markey that additional legislation was necessary. Tom Tauke of Verizon said he thought the FCC had the authority, but added that Verizon did not operate a "shared network" and thus did not engage in the tactics of which Comcast was accused. Comcast's Cohen said he thought the Commission had not followed its own rulemaking procedures and thus could not penalize Comcast. When asked if the Commission could levy penalties after making such rules he said he "would have to get back to them."
If the morning's session was mostly lawyers, the afternoon was mostly technologists. David Reed, of the MIT Media Lab used a paper envelope to illustrate the difference between a IP packet and it's contents, and made the analogy that what Comcast was doing amounted to opening the envelope and messing with the packets. [Update: text of Reed's statement here] ] He said he had captured the packets on both ends of a BitTorrent connection on the Comcast network and observed how Comcast had forged RST packets so that each user's machine was fooled into thinking the packet came from the other user's machine. As David Clark and other witnesses pointed out, the Internet has long had mechanisms for handling bandwidth shortages. Comcast's major sin was hacking something together that violated all the rules, and then denying that they did it - not the kind of cooperation on which the Internet has depended.
Clark bemoaned the unwillingness of any of the network operators to share usage information, making it impossible to assess how widespread were the problems that Comcast complained about. He did cite some figures he found which indicated that it cost a network operator $0.10 to deliver a gigabyte, outing the cost of provisioning the average customer at $0.50 per month. On the other hand, watching HDTV might consume 200 GB per month, so the incremental cost of IPTV could be $20.00. He said that all-you-can-eat pricing may not be tenable under those circumstances and that network operators may end up going to some sort of tiered pricing.
At about 5:00 pm, the group adjourned to Pound Hall for some wine and cheese. Chairman Martin (shown at right holding a Diet Coke) stayed for several hours chatting with the participants. (Bob Frankston in the photo.)
Twitter's developers have been silent on the demographics of their user base, but there has been speculation that it may skew older than Facebook or AIM. Recently Zena Weist used Twitter itself to conduct a survey. While it was admittedly an unscientific sample, she did get 120 responses. The ages ranged from 14 to 68, with the average being 37. That may explain why several of my over-37 friends have been asking me about Twitter recently.
You can contribute to the poll, and track the results by tweeting your age to @zenaweist.
Here are some more details on Monday's FCC Hearing at the Harvard Law School.
Date: Monday, February 25, 2008
Time: 11:00 a.m. (Eastern Standard Time)
Location: Harvard Law School
Ames Courtroom, Austin Hall
1515 Massachusetts Avenue
Cambridge, MA 02138
Directions: www.law.harvard.edu/about/contact/directions.php
Streaming Audio: www.fcc.gov/realaudio
Schedule:
11:00 am Welcome/Opening Remarks
11:45 am Technology Demonstration – Gilles BianRosa, CEO, Vuze, Inc.
12:00 pm Panel Discussion 1: Policy Perspectives
1:30 Lunch break
2:15 Panel Discussion 2: Technological Perspectives
3:45 Closing Remarks
4:00 Post-panel discussion
5:15 Reception - Pound Hall - room 212 - John Chipman Gray room
I put links to some background reading here.
I had a visit yesterday from Steven Ginzberg and Jack Schatz of Gray Box Software. They showed me a new financial analysis and modeling tool - RulesBase. A mutual friend had noticed a resemblance to a product from my first start-up, Javelin Software, and suggested they seek my advice. I've spent quite a bit of time recently advising startups on other technologies with which I've worked - audio, video, wireless, social networks - but this was definitely a flash from the past.
Javelin was a financial modeling package that was based on formulas instead of cells, and used GUI and windowing before Windows (Steve Balmer paid us a visit and asked us to consider porting it). It beat Excel for Infoworld's Software Product of the Year, much to the consternation of Bill Gates. The company never did displace Lotus 123, but Lotus did pay the compliment of implementing many of Javelin's features in Lotus Improv. The company was acquired by IRI which later became part of Oracle.
Like Javelin, RulesBase uses formulas, like GrossMargin = Sales - CostOfGoods instead of C23=C21-C22. The variables can represent vectors, so one formula can define multiple time periods or product lines. The idea is to offer a more intuitive and less error-prone method of building sophisticated financial models. RulesBase doesn't have the full set of features we built into Javelin, such as time series or pivot tables, but I think that's a good thing. I recommended Gray Box follow Jason Fried's advice in Getting Real:
Make each feature work hard to be implemented. Make each
feature prove itself and show that it’s a survivor. It’s like “Fight
Club.” You should only consider features if they’re willing to
stand on the porch for three days waiting to be let in.
Or as I've said before, iterate in the marketplace, not the conference room.
Sometimes an old idea becomes new again when some breakthrough occurs, such as an increase in processor speed or the availability of a graphical user interface. Those things will benefit RulesBase, but perhaps the most promising development is the adoption of object-oriented and agile development methodology. Not only will those advances aid in the building of the product, they also can be applied to the development of the models built with the product.
A pre-release version of the software can be downloaded from the site.
It looks like the SM-3 missile launched from the cruiser Lake Erie successfully shot down USA 193, the spy satellite which had died shortly after launch in 2006. If the bus-sized vehicle had crashed to earth with its Hydrazine fuel tanks intact it would have made quite a mess.
According to the FEMA First Responder Guide For Space Object Re-Entry Hydrazine is pretty nasty stuff:
- Hydrazine vapor is exceptionally hazardous in that once it is ignited it will continue to burn by exothermic decomposition in complete absence of air or other oxidant.
- Explodes during distillation if traces of air are present, also affected by UV and metal ion catalysts.
- The decomposition reaction may be explosive, especially when catalysed by certain metals and metal oxides.
It's also a carcinogen and highly corrosive.
Last chance until 21 December 2010.
In preparation for Monday's FCC hearing in Cambridge on Net Neutrality, I hope the commissioners have reviewed all of the material submitted by interested citizens. Of the 28,519 documents sent to the FCC Web Site, there are some insightful comments by CTOs of local software companies, but also a lot of submissions like this one:
MY PARENTS ARE ANNOYING
my parents can be soooooooooo annoying! ok so my mom is always invading my privacy, asking stupid stuff like who are you talkin to and blah blah blah. if i trip or sumthing i get a whole effing line of insults to my face. and they arent funny. and they try to suck the fun OUT of my life. they call rules "limits that must be set down". otherwise known as we hate you, we dont trust you,and you are a wild animal that must be tamed. and if my dad as at work and my mom starts being stupid she will call him. they even hit me sometimes. they talk about crap like control your voice's tone, and come back in at 7, i don't care how old you are and if its the summer! they let my 8 year sister have more freedom than me. if i try to tell them this i get spanked more than once. I HATE MY DAMN LIFE AND ITS ALL THEIR FAULT!
David Evans of Market Platform Dynamics and Thomas Eisenmann of the Harvard Business School gave a talk today on Google's Next Moves that added some depth to the understanding of Google's business model and made some predictions for the future.
David Evans described Googlenomics:
Google's 75% share of the paid search dollar stems from two simple principles:
Evans pointed out that the Google Terms of Service give Google the right to place ads in its services in the future even in places and ways that they don't do so today.
The technology behind the ad revenue model has three parts:
Prices are set in a Second Price Auction which has been found by economists to generate the maximum return for the seller. The resulting price depends upon the keyword purchased, for a Luxury Hotel in New York, the price of the number 1 position is $3.89 per click, but a Hot Dog Vendor only has to pay 59 cents.
The goal for Google is to maximize the revenue per search, as given by the following formula:
RPS = APS x CPA x PPC
where
RPS = Revenue per search
APS = Ads displayed per search
CPA = Click-throughs per ad
PPC = Price per click
Maximizing revenue is not simply a matter of getting the highest price for an ad, hence the quality scoring algorithm which will give favored placement to a lower priced ad if it will generate more clicks.
Interesting facts:
Google's superior revenue per search comes not only from its superior technology but also from its scale, which allows it to attract more advertisers who will bid on more search terms. These two factors account for Microsoft's desire to acquire Yahoo.
Thomas Eisenmann talked about the competitive challenges facing Google and its likely actions:
There are three different screens where ads can be placed: TV, Mobile, and PC. Each of these has a potential competitor who can impede access, such as the cable companies, mobile operators, and Microsoft, respectively. Google can counter this threat either by "playing nice" through openness initiatives such as OpenSocial and the Open Handset Alliance or it can play tough and enter the market directly, such as acquiring Facebook or purchasing wireless spectrum.
Another strategy is "platform envelopment" - bundling products together in a way that is difficult for competitors to match. An successful example is Google Base which combines a free product listing, paid search, and a discount on payment processing. A riskier case is offering free productivity applications such as a word processor, since it's not clear that peoplle are in a buying mood when they are composing a document.
Eisenmann said that Facebook could be a threat to Google if it started pulling more users into its walled garden, although he was not all that sanguine about social networks.
Similarly, Eisenmann thought Android will be a stretch since it is really hard to make a compelling mobile platform.
Over-the-top (OTT) video - creating an alternative video distribution over a commodity IP network - is another way Google can win. Google can offer the "same head, longer tail" than the cable MSOs, provide better targeted ads and a superior recommendation engine. Even if Google undercuts the average cost of a cable bundle and pays above the going rate to a content provider there is still enough margin to have a lucrative business.
In the end, Google's biggest problem may be overreach and arrogance. I remember my days at Lotus where no matter what we did money rained down on us. It's easy under such circumstances to believe that the success is a function of one's genius, but when the money flow stops it can be quite baffling.
Some of Evans and Eisenmann's predictions:
One of my favorite talks from the TED Conference was just released as a video on the Web. In 2002, George Dyson described how his father Freeman Dyson worked on a classified project in 1958 to build a nuclear-powered spaceship. The idea was to overcome a major limitation of chemical-fueled rockets, which is that as the payload gets larger the amount of fuel increases as well. Since the fuel itself must be lifted into space, this creates a natural limit on the size of the ship, which can be a problem if you want to send people to Saturn or send enough explosives into space to deflect an asteroid.
The solution was to eject small (5 to 10 kiloton) nuclear bombs out of the business end of the ship, with the subsequent explosion propelling the craft forward. Of course there were some issues with the radiation it would produce, and the problem of what would happen to the eyeballs of people on the ground who looked up during the launch. The project was ultimately shelved although Dyson claims there is an effort at NASA to retain the knowledge in case an asteroid ever does head our way. He wrote a book about it which is full of fascinating detail.
