The Geek’s Reading List – Week of November 24th, 2012
I offer a welcome back to my earlier readers and an introduction for my new ones. I am an independent analyst and consultant with 19 years of experience as a sell side technology analyst, and 13 years of prior experience as an electronics designer and software developer.
The purpose of the Geek’s Reading List is to draw attention to interesting articles I encounter from time to time. I hope that what I find interesting you will find interesting as well. These articles are not to be construed as investment advice, even though I may opine on the wisdom of the markets from time to time. That being said, it is absolutely important that investors understand the industry in which they are investing, along with the trends and developments within that industry. Therefore, I believe these comments may actually help investors with a longer time horizon.
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1. Windows 8 Is A Dud, Targets Not Reached Claims Insider
There has been a lots of news about Windows 8 adoption over the past couple weeks. Not much of it is favorable, which is not surprising, because people really don’t care about new operating systems any more: only a small portion of the population ever upgrades, and an even smaller number would buy a whole new PC just to get the latest OS.
“In Australia Microsoft’s PR Company Ogilvy & Mather and internal PR hacks are refusing to return calls about the struggling Windows 8 or report how sales of their Surface Tablet are going with insiders now tipping the return of a “start button” in an effort to try and lure consumers to upgrade. A big problem for Microsoft is that consumers are not buying new notebooks or hardware running Windows 8 which is creating issues between Microsoft and their partners such as Dell, HP, Toshiba, Acer and Asus.”
2. Windows 8 sales ‘well below’ projections, report claims
More of the same, but, as usual, he just doesn’t get it: people see virtually no marginal benefit to a new version of Windows, so they just don’t give a damn. There isn’t much in the way of hype and flash (assuming Microsoft could muster either) which is going to change that.
“Sales of Windows 8 PCs are well below Microsoft’s internal projections and have been described inside the company as disappointing,” Paul Thurrott wrote on his Supersite For Windows today, citing a source inside Microsoft. The culprit? “Lackluster PC maker designs and availability,” according to Thurrott.”
3. Loophole enables anyone to get a Windows 8 license for free
Given the complete lack of interest shown in Windows 8, one has to wonder if this isn’t an effort by Microsoft to increase license activation numbers.
“Copies of Windows 8 Pro are freely available from Microsoft’s website for anyone who wants to try out the operating system. Normally, the software would expire after 180 days, a period that is meant to allow Volume Licensing customers to automate and manage the activation process. But a loophole in the company’s Key Management System allows anyone to legitimately activate their copy of Windows 8 permanently, for free.”
4. How Much Longer Can Tech’s Free Party Last?
The author of this short article gets a lot of things wrong. First, ‘free apps’ are often trivial in nature and you could not sell them. Second, a lot of really good open source software is free because it is a community project – venture capitalists do not factor in to its’ creation. Third, development tools nowadays are very powerful and very inexpensive, meaning somebody can slap together a pretty good project for little or no money. Finally, the business model of Apple, and others, is based upon the ‘pull’ created by free or inexpensive apps, creating a market for the hardware (and they skim a lot off the top of any actual app related revenue).
“It’s possible that venture capital firms will continue to support apps and software companies until they reach an audience and have to start thinking about making money. After all, inventing an app isn’t like inventing the toaster: The first connects on a global platform that already exists (the Internet, the smart phone) and the second requires an expensive and labor intensive global supply chain to build and ship across the world. As a result, you can build a global software product with just a handful of great engineers, which makes it much easier to sell your product for next to nothing.”
5. As Boom Lures App Creators, Tough Part Is Making a Living
More of the same – after all, most apps are essentially digital trivia, and there should be no more money in that than in blogging or web design. Eventually people will figure this out. One has to wonder how many Macbooks have been sold to support this boom/bust. As for the ‘app factories’ we so recently read about, let’s just say they likely do not represent a long term investment opportunity.
“The couple’s chosen field is so new it did not even exist a few years ago: writing software applications for mobile devices like the iPhone or iPad. Even as unemployment remained stubbornly high and the economy struggled to emerge from the recession’s shadow, the ranks of computer software engineers, including app writers, increased nearly 8 percent in 2010 to more than a million, according to the latest available government data for that category. These software engineers now outnumber farmers and have almost caught up with lawyers.”
6. Why Owning Software or Data ‘No Longer Makes Sense’
So says the guy who works for SAP, in any event. I am not a big believer in ‘the cloud’ mostly because of the very factors cited in the brief article – plus security and the fact outsourcing usually goes to the lowest bidder, regardless of who you think you are dealing with. Regardless, the question you have to ask yourself is – if my software and data is core to my business, what happens when by cloud provider (or my business) goes off line?
“We are moving into a world that is evolving into a subscription economy,” says Erik Berggren, vice president of customer results and global research at Success Factors (an SAP company). “What you want both as a consumer and as a business user is the utility of something. You want a means of transportation. You want computing power. You want answers to your questions. You want to get something done really quickly in your business. That’s going to be the driving force.”
7. Organic Light Emitting Diode to be used in the manufacture of soft screen phone
A misleading headline – OLED displays have been around for some time. Actual sale of a product with a flexible display is newsworthy, however. Over the long term, flexible displays may be made on a continuous (web) production line, driving costs to very low levels.
“Samsung began incremental production of smartphones able to bend the screen and even be folded into the pocket, it is learned that this innovative technology uses organiclight emitting diodes (OLEDs), they are very thin, you can place them on soft material such as plastic and metal foil. Samsung is not the only commercial company who uses Organic Light Emitting Diode to develop soft screen, it also includes: Sony Corporation of Japan and the South Korean LG company.”
8. How To Enable 4G LTE On The Google Nexus 4
It is hard to believe this functionality is there, because the hardware cost of LTE support is not trivial, and yet why support it in hardware if you have to hack to support it in software? Perhaps Samsung is awaiting regulatory approval for a subsequent software upgrade.
“Reports surfaced this morning that the Nexus 4, Google’s latest flagship Android smartphone, supports LTE via a relatively easy software hack. After testing, it turns out that’s definitely true, so I’ll show you exactly how to enable it on your device. Fair warning: the Nexus 4 only supports LTE on the AWS band (1700 or 2100MHz), which is currently used for LTE networks in Canada, and for some areas served by T-Mobile’s fledgling 4G network.”
9. Phone patents: An absurd battle
The author does not address the real problem, namely, that you can get a US patent on anything right now. It used to be that you had to show utility, novelty, and most significantly in the context of technology related patents ‘non-obviousness’. I recall, when I was designing my first cellphone, discovering that Motorola had a patent on a circuit which basically consisted of a flip-flop and an XOR gate, despite the fact that 99% of digital designers would have ‘discovered’ exactly the same solution. It you allow patents on trivia, you are going to be overwhelmed with patents and infringement.
“To get an idea of the size of the problem facing the likes of Apple and Samsung, consider this: O’Connor believes – based on estimates from patent firm RPX – that there are about 250,000 active patents in the United States that may have some relevance to the activities of mobile device manufacturers out of a total of about 1.5 million active patents. That means that about 17% of all active patents in the United States are potentially patents on smartphone technology. ”
10. NTSB drops ‘unacceptable’ BlackBerry for iPhone
It may be that US government agencies are simply dropping a ‘foreign’ product for a ‘domestic’ one. That being said, government accounts have been a major stronghold for RIM and they’ll be nearly impossible to win back.
“Research in Motion’s BlackBerry devices “have been failing both at inopportune times and at an unacceptable rate,” the agency wrote in a procurement request issued last week.”
11. How to Join the Open Wireless Movement
This movement has twin advantages: cheap Internet access (which should, ultimately drive down pricing of the paid for kind, and frustration of efforts to ‘clamp down’ on ‘piracy’ – after all, your honor, it wasn’t me but an anonymous user who downloaded those files.
“The talk that caught my attention, however, was Adi Kamdar’s presentation about the Electronic Frontier Foundations’s new campaign, The Open Wireless Movement. The Open Wireless Movement’s purpose is to encourage folks to open their personal networks to the public. The EFF partnered with some great organizations to get this off the ground.”
12. Bad Reasoning: We Don’t Need More High Speed Internet Because People Don’t Use Fast Internet Now
This is the problem with a lot of decisions being made regarding telecommunications policy in general – many of the commentators simply don’t get it. Of course only a few people use a higher speed service: applications exploiting an infrastructure tend to come well after that infrastructure has been constructed. Who would have conceived of streaming video during the dial up era?
“This reasoning is faulty on many, many levels. First off, if you look at the full Booz report, almost every conclusion is exactly the opposite of what Worstall suggests. He seems to take that one paragraph out of context, and assume that because only a small percentage of people were taking advantage of “top speeds” it means that there’s no real demand for it and no economic benefit.”
13. Training light to respond to light
The ability to deal with light without converting it to electricity has significant potential advantages in communications. Computational applications are probably a long way off.
“If you fire two electrons at one other, they interact; they’re charged particles. With photons, they literally fly straight through one another. In particular, what is necessary is some kind of nonlinear interaction—nonlinear optics, which was actually invented, so to speak, here at Harvard by Nicolaas Bloembergen and others, in the late ’60s, early ’70s.”
14. How to Make Almost Anything
This is a rather good article from a surprising source, even though it gets off to a bad start. Of course commentators are more optimistic than those in the status quo: they are ignorant of reality and they can see opportunities where others can’t. Consider the quote below, how would it read if we substituted microwave oven for PC?
“Additive manufacturing has been widely hailed as a revolution, featured on the cover of publications from Wired to The Economist. This is, however, a curious sort of revolution, proclaimed more by its observers than its practitioners. In a well-equipped workshop, a 3-D printer might be used for about a quarter of the jobs, with other machines doing the rest. One reason is that the printers are slow, taking hours or even days to make things. Other computer-controlled tools can produce parts faster, or with finer features, or that are larger, lighter, or stronger. Glowing articles about 3-D printers read like the stories in the 1950s that proclaimed that microwave ovens were the future of cooking. Microwaves are convenient, but they don’t replace the rest of the kitchen.”
15. The Rise and Fall of AMD
A good history, but I suspect they are being optimistic about the future. Like many tech companies, AMD’s downfall can be traced to a large, dumb, over-priced acquisition. The die was cast, and now that the PC industry is no longer a growth industry, their fate is sealed.
“AMD has long been subject of polarizing debate among technology enthusiasts. The chapters of its history provide ample ammunition for countless discussions and no small measure of rancour. Considering that it was once considered an equal to Intel, many wonder why AMD is failing today.”
16. Death by a Billion Clicks
The consumer electronics retail sector witnessed a boom as a result of the advent of the PC and mobile space, and, most significantly for Best Buy, the HDTV revolution. Unfortunately, these have all run their course, so who needs to go to a store when you know exactly what you need and don’t need to pay extra for ‘advice’ from a sales person who likely knows less than you do?
“Just a few years ago, Best Buy was hailed as one of the finest retailers in the world. It had vanquished its rival, Circuit City, and was likely selling more electronics per square foot than any other company. But by 2012 it was in tatters.”
17. Star Trek Classroom: the next generation of school desks
I used to follow SMART Technologies, which was in the ‘ed-tech’ business. It’s bad enough when your customer is the government, even worse when said customer places a lot of things ahead of education in its priorities list. That being said, when following SMART I was exposed to all kinds of ‘ed-tech’ research: I had never read such vacuous, unscientific, crap in all my life.
“New results from a 3-year project working with over 400 pupils, mostly 8-10 year olds, show that collaborative learning increases both fluency and flexibility in maths. It also shows that using an interactive ‘smart’ desk can have benefits over doing mathematics on paper.”
18. The black box that could change the world
Because, if you want an objective and informed discussion about a company involved in quantum computing, you are going to read about it the Globe and Mail’s business section. Suffice it to say I’d wait for an actual impact before even imputing ‘world changing.’
“This nascent technology can handle information not just in binary format (zeros or ones) but harness the power of quantum mechanics to deploy zeros and ones at the same time. It has the potential to be millions of times more powerful than today’s supercomputers, solving complex problems in minutes that currently would take years.”
19. Supercomputers face growing resilience problems
This sort of makes sense, but it is very analogous to the challenges faced with earlier computers such as ENIAC. Improved fault tolerant algorithms and, as the article describes, predicting failures before they happen are important counter measures.
“As supercomputers grow more powerful, they’ll also grow more vulnerable to failure, thanks to the increased amount of built-in componentry. A few researchers at the recent SC12 conference, held last week in Salt Lake City, offered possible solutions to this growing problem. Today’s high-performance computing (HPC) systems can have 100,000 nodes or more — with each node built from multiple components of memory, processors, buses and other circuitry. Statistically speaking, all these components will fail at some point, and they halt operations when they do so, said David Fiala, a Ph.D student at the North Carolina State University, during a talk at SC12.”
20. Single photon could detect quantum-scale black holes
The interesting thing with this hypothesis is that it implies the universe is, essentially, integer: if the smallest feature can be defined, and the largest is determined by the speed of light and age of the universe, everything should be representable by integer coordinates!
“Space is not smooth: physicists think that on the quantum scale, it is composed of indivisible subunits, like the dots that make up a pointillist painting. This pixellated landscape is thought to seethe with black holes smaller than one trillionth of one trillionth of the diameter of a hydrogen atom, continuously popping in and out of existence.”