The Geek’s Reading List – Week of December 7th, 2012
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.
Please feel free to pass this newsletter on. I am trying to reconstruct my distribution list so if you receive this newsletter and want to be added to the distribution list, send me an email at email@example.com. Of course, if you find any articles you think should be included, please send them on to me!
I blog at www.thegeeksreadinglist.com.
1. IHS cuts chip market forecast
I am going to save you tens of thousands of dollars in consulting reports – from now on, for the indefinite future the semiconductor industry is going to grow at the same rate as global GDP, plus or minus 3%. Not only that, but my free forecast is likely to be more accurate than the forecasts sold by any of the industry analysts. Oh, and the HIS forecasts for 2013 and beyond – seriously, you have to be joking …
“Market research firm IHS iSuppli Monday (Dec. 3) cut its forecast for the 2012 semiconductor market for the third time in just over three months, saying it now expects the chip market to contract by 2.3 percent based on projected shortfalls in most major end markets.”
2. Taiwan engineers defeat limits of flash memory
A more accurate headline would be “… propose a solution to vastly extend the life of Flash memory.” Nonetheless, as I have pointed out in the past, because ‘wear’ on Flash memory is a more significant consideration when the devices are used as SSDs, the industry would seek solutions to these and similar limitations. This approach promises to do away with that problem.
“They redesigned a flash memory chip to include onboard heaters to anneal small groups of memory cells. Applying a brief jolt of heat to a very restricted area within the chip (800 degrees C) returns the cell to a “good” state. They said that the process does not have to be run all that often. According to project member Hang‑Ting Lue, the annealing can be done infrequently and on one sector at a time while the device is inactive but still connected to the power source. It would not drain a cellphone battery, he added.”
3. Update: New 25 GPU Monster Devours Passwords In Seconds
I guess we now understand why you need a password of at least 8 characters, one upper case and one lower case character, and one symbol or number: it increases the amount of time to crack by a couple seconds or so!
“There needs to be some kind of Moore’s law analog to capture the tremendous advances in the speed of password cracking operations. Just within the last five years, there’s been an explosion in innovation in this ancient art, as researchers have realized that they can harness specialized silicon and cloud based computing pools to quickly and efficiently break passwords.”
4. FIPEL lights could replace LEDs
Polymer lighting has been a promising field for a while. I don’t know of any reason why the technology can’t replace LED, but it has been ‘just around the corner’ for some time now. Besides, there are lots of applications where you want a concentrated light.
“The lighting, based on field-induced polymer electroluminescent (FIPEL) technology, also gives off a soft, white light, rather than the yellowish tone of fluorescents or LEDs’ bluish tinge.”
5. Top 25 US developers account for half of app revenue
This is scarcely surprising, and I would bet that the number of companies taking the lion’s share of revenue from the PC market is even more distorted. App stores of various flavors claim hundreds of thousands of ‘apps’, most of which are essentially web pages, and few of which have any value, other than the sponsor. Think of it this way: there are reportedly 700,000 apps on iOS and Android. If the average one generated sales of only $1,000 per month, that would be 700 million in monthly revenue. Could that ever make sense?
“A small number of developers, almost entirely game companies, continue to generate the majority of revenue at the leading app stores – Apple’s App Store (iPhone only) and Google Play. Based on daily App Interrogator surveys, Canalys estimates that just 25 developers accounted for 50% of app revenue in the US in these stores during the first 20 days of November 2012. Between them, they made $60 million from paid-for downloads and in-app purchases over this period.”
6. Google’s Explainer-in-Chief Can’t Explain Apple
Apple’s strategy does make sense in that they want spread fear, uncertainty, and doubt among Android manufacturers. They can get damages, or settle, with each of them individually and go after Google at their leisure. On the other hand, if they go after Google directly they risk losing it all, or, by settling with Google, placing Android vendors off limits. Either way, it’s a sleazy way to run a company, but then again, Apple has never been about technology.
“Apple and Google are well aware of the legal strategies of each other. Part of the conversations that are going on all the time is to talk about them. It’s extremely curious that Apple has chosen to sue Google’s partners and not Google itself.”
7. The Next Big OS War Is in Your Dashboard
Open Source software has gotten so good it is hard to believe anybody starting a project would not give it a close look. Not only is the quality good, many developers know how to code with it and there is a vast library of readily available, good quality code (and a lot of crap as well). Even if the companies do not decide to use open source, its availability has to set a ceiling on how much closed source solutions should cost.
“The shift in focus from what’s under the hood to what’s behind the dashboard has brought a largely covert war to the auto industry over the operating systems that will control these gadgets. As in the smartphone biz, the battle line is between proprietary and open source software. The outcome will determine what these systems look like, how they work and how distinctive they are as automakers embrace walled gardens or open ecosystems.”
8. Sales down, Microsoft raises prices radically
This is what a monopolist does: they have set up a ‘simplified’ licensing system which puts them in complete control of the customer. Because they have no apparent capacity for innovation or product improvement, they can squeeze their existing (i.e. remaining) customers a little harder each year. Their existing customers are pretty much screwed right now as they have no choice but to pay up. However, it makes Android and other open source alternatives more attractive for emerging or growing companies. Eventually this will catch up to Microsoft.
“Microsoft is going to make up for the Windows 8 sales shortfall in a brilliant move, milking the trapped. In a shock to no one, they are raising prices on their enterprise customers to cover consumer revenue potholes.”
9. Christmas gift for someone you hate: Windows 8
One of the funnier Windows 8 reviews I have seen. I don’t think a better tablet interface would have made Windows 8 a winner – though it might have made it a viable option to an iPad, albeit, at a similar price. The average desktop or laptop user has no interest in a tablet user interface, and there are more interesting paradigms, if you wanted to offer an enhancement.
“One thing that Android and iOS do not address is how to handle the requirement of offering a legacy Xerox Alto-style mouse and windows environment. Microsoft here integrates the tablet and the standard Windows desktop in the most inconvenient and inconsistent possible way.”
10. Here Comes the First Real Alternative to iPhone and Android
Probably not, but you never know: after all, as RIM has discovered, users are not married to user interfaces anymore – they adapt to whatever they like. If this company can gain critical mass (and a China footprint would be a good start) it stands a chance.
“Sailfish, Jolla insists, will become a legitimate alternative to the Coke and Pepsi of smartphone platforms: Apple’s iOS and Google’s Android. Microsoft would like to accomplish the same thing, and has spent billions trying, with limited success; it has already cut back production for the new tablet running its latest OS, Windows 8. So what makes this group of fewer than 100-odd Finns, most of them refugees from the sinking ship that is Nokia, think they stand a chance?”
11. Won’t Someone Take iTunes Out Back and Shoot It?
I stopped letting iTunes update itself about a year ago. It seems it has devolved into the same sort of massive bloatware as Adobe’s PDF reader (well, actually pretty much any piece of software Adobe produces). I just want something to stick music on my iPod: why does it have to be so big, and need a new download every couple weeks?
“I picture frazzled engineers growing increasingly alarmed as they discover that the iTunes codebase has been overrun by some kind of self-replicating virus that keeps adding random features and redesigns. The coders can’t figure out what’s going on—why iTunes, alone among Apple products, keeps growing more ungainly. At the head of the team is a grizzled old engineer who’s been at Apple forever. He’s surly and crude, always making vulgar jokes about iPads. But the company can’t afford to get rid of him—he’s the only one who understands how to operate the furnaces in the iTunes boiler room.”
12. 3D printing: The hype, the hopes, the hurdles
This is a surprisingly good article which discusses some applications, potential applications, and real challenges for 3D printing technology.
“Three-dimensional printing: hype, or hope? That’s the question industry leaders sought to answer at the Techonomy conference here in the sunny greater Tucson area. A panel of experts — Geomagic’s Ping Fu, Shapeways’ Peter Weijmarshausen and PARC’s Stephen Hoover, with CNET’s own Paul Sloan moderating — discussed the promises, pitfalls and potential of a technology that allows almost anyone to turn a digital file into a perfect copy of a physical object, from puzzle pieces to airplane wings, in materials such as plastic, metal and rubberlike polymers.”
13. Jan Leno Sowing Off Some 3d Printing And Scanning Technology
Of course, they could have just as easily scanned the part and milled it out of plastic on a CNC to see if it fit. The 3D printer, in this example, was not necessary. However, the examples, especially the steam engine, are kind of interesting.
14. Ultralight fractal structures could bear heavy loads
In many ways, this shows the potential impact of computational performance on engineering. Actually manufacturing these components may be a lot more challenging than designing them, however. 3D printers tend to have modest size limits and a narrow selection of materials. Nonetheless, for situations where strength/weight is extremely important (space, for example) this could be a breakthrough.
“A team of researchers in Europe has shown that the density of large structures can be dramatically reduced, if they are designed using a fractal pattern. The researchers have worked out a way to calculate an optimal “hierarchal structure” built from a certain material so that it can withstand a given load. They claim that using such techniques could help in building highly efficient load-bearing structures that could be used in solar sails, cranes or other lightweight-yet-strong constructs.”
15. Startup to launch $199 brainwave computer controller in 2013
This product is a ‘brainwave sensing’ head-band, and it is developed by a Toronto company. It will be cool if deterministic outcomes (i.e. control, not just influencing) can be produced with this gizmo however. The video on the company website is not entirely clear on what can be done at this stage.
“Startup Interaxon today announced it’ll ship a $199 headset called the Muse next spring that will let people use their brainwaves to directly control videogames and other computing operations.”
16. First Electron Microscope Image of DNA Double Helix
Even though the structure of DNA was figured out decades ago (and X-ray crystallography was just a part of that) it is, nonetheless, pretty cool to be able to actually see it.
“The structure of DNA was originally discovered by using X-ray crystallography, which involves scattering X-rays off atoms in crystallized arrays of DNA to form complex patterns of dots on photographic film. Images were then interpreted using complex mathematics. These new images are now direct pictures of DNA strands, seen through an electron microscope, which sees electrons rather than photons.”
17. Blurry photos: New program fixes the unfixable
This might be of some use to people.
“Load your blurry image into the program, and start monkeying with the sliders. A progress bar at the bottom of the window moves to show how the image is being processed according to each change in parameters, and on my reasonably powerful desktop machine, each change took about 15 seconds to resolve.”
18. Groupon: from dotcom star to just another coupon business
Big surprise here: I mean, it is a coupon business which its exploited by cost sensitive purchasers who descend, like a pack of piranha, on whatever business is willing to offer deep discounts (often below cost) until it’s over then move on to the next victim. Who needs a middleman to give stuff away? (ps: this also shows why I avoid stocks with ‘multiple voting’ shares like the plague.)
“Even Mason admits the board is right to be pondering his future. “Here’s a news flash: our stock is down about 80%. It would be weird if the board wasn’t discussing whether I’m the right guy to do the job,” he said at a conference held by news site Business Insider last week. Clearly Mason still thinks he is the right guy: he survived last week’s board meeting, helped in part by shares that give him 10 times the votes of his peers. But the odds on his long-term survival are getting longer.”
19. A123 Goes on the Auction Block: Here’s How It Got This Bad
A123 was an amazing story: a company which had promising technology which was going to revolutionize the Lithium Ion battery business. You know those disruptive battery technologies you read about every second day (the days between the disruptive solar technologies)? Well, this was one of them, except it wasn’t that disruptive, so they couldn’t get much of a premium over plain old fashioned batteries. And, while they were losing money hand over fist, investors (and government was keen to keep those very hands and fists full. Then the gravy trains stopped and, a business which was more or less built to lose money actually ran out of money. Go figure.
“So how did we end up here? It’s hard to pin down a singular cause for A123’s demise. But the company’s early filings in the bankruptcy case lay out a few key moments. It helps illustrate a blow-by-blow account—at least from A123’s perspective—of how the company’s fortunes unraveled so quickly.”
20. CO2 emissions could feed algae biofuel bonanza
Newsflash: plant life thrives in a CO2 rice environment! So, if we make a special manufacturing plant which grows algae – we’ll do something Mother Nature never intended: converting CO2 and light into biomass! Our problems are solved! You say algae grows naturally in ponds and oceans? Enough of this foolish optimism!
“Algae is the solution to the climate-change issue,” explains Steve Martin, Pond Biofuels’ CEO. He says it’s not enough to hide carbon underground, as you would with a carbon capture and sequestration project. You need a way to fix the carbon in place.”