The Geek’s Reading List – Week of January 18th, 2013
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. 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. TMT Predictions 2013
For those of you who missed Deloitt’s TMT Predictions 2013 launch, this page links to the full report. There is good stuff here – but, as they say, it is the beginning of a discussion.
“What new funding trend could complement your existing venture capital efforts in 2013? How could your company leverage the “Bring Your Own Computer” policy as a key tool? These are just a few of the insights your company will gain in reading Deloitte’s Technology, Media & Telecommunications (TMT) Predictions 2013.”
2. Google Declares War on the Password
This is consistent with the Deloitte Prediction 2013 regarding the death of password only security. I rather doubt it has to get this complicated: a 1024 byte random password stored on an USB device or NFC device which might be stored on phone or, even in multiple places. When used in junction with an actual password this would frustrate most scams. Loss or theft of the token could be dealt with through more complex schemes.
“This may be closer than you think. Google’s security team outlines this sort of ring-finger authentication in a new research paper, set to be published late this month in the engineering journal IEEE Security & Privacy Magazine. In it, Google Vice President of Security Eric Grosse and Engineer Mayank Upadhyay outline all sorts ways they think people could wind up logging into websites in the future — and it’s about time.”
3. Worldwide PC shipments slipped 6.4% in the fourth quarter to 89.8 million units
I don’t think this is caused by Windows 8, but Microsoft’s fiasco may have the effect of encouraging people to seek alternatives rather than buying a new PC with a touch centric operating system which actually lacks a touch input device.
“In the fourth quarter of 2012, worldwide PC shipments declined 6.4%, sliding to a total count of 89.8 million units, according to IDC. For the year, 352 million PCs were sold. Compared to 2011, that figure represents a 3.2% decline.”
4. ARM suppliers join Facebook Open Compute Project
I had to choke back both laughter and tears when this got so much coverage on the web the other day. If nothing else it is a sure sign the major qualification to write about tech is to have a complete ignorance of the past and present of technology. This is how things were done until about 20 years ago. There is a reason it isn’t done this way anymore: what you gain in flexibility you lose in performance and cost. You don’t keep stuff as one part become obsolete because all the components are always becoming obsolete. Plus, hardware and software maintenance of an heterogeneous hardware environment is a nightmare.
“Facebook’s Open Compute Project is being expanded to incorporate ARM processors, providing new options for companies shopping for low-cost hardware to build out cloud computing environments. Chip vendors from both the ARM and x86 sides of the house announced they are working together to develop a “common slot architecture” that will allow ARM and x86 processors to coexist side by side on the same motherboard.”
5. Dell’s bold plan to reinvent itself: A USB-sized PC that gives access to Windows, Mac OS, Chrome OS
God help me: I have been working with computers since I was 17 years old (that was unusual back then). Like clockwork, or a recurring rash, every few years or so, somebody rehashes this idea in one form or another. Besides all the questions regarding security (i.e. what happens when Dell closes its doors or a new private equity owner decides to increase service charges, holding your data and applications hostage) what do you do when the network goes down like happened in Ontario the other day?
“Dell is working on a projected currently called “Ophelia” that is “a complete, self-contained PC” that also happens to be as big as a USB thumb drive. But the killer feature of Ophelia is that it uses “virtual instances of… operating systems running in the cloud” to give users access to “Windows, Mac OS, Google’s Chrome OS, Dell’s custom cloud solutions, Citrix cloud software, and even Google’s Chrome OS.” Let’s take a step back and think about what this really means. If you plug Ophelia into a flat-panel television, it will connect to the nearest Wi-Fi network and give you access to any type of operating system or app that is running virtually somewhere in the cloud.”
6. London Calling: Are ARM’s core days numbered?
An interesting article but I do not see how the title aligns with the discussion. Companies have outsourced their CPU designs for a long time, either to ARM or Intel, so nothing really changed except the business model. Differentiation tends to come from software, in any event.
“Time was when a great many companies had their own processor architectures. It was a pinnacle of electronic and semiconductor achievement and many digital engineers wanted to have a crack at designing one and feeling the glow of watching software execute on an electronic machine of their own devising.”
7. Is Apple’s iPhone No Longer Cool To Teens?
The mention of the Microsoft Surface tablet makes me a bit skeptical (though against all odds I saw one in the wild today), however, I have believed for some time that the smartphone business (and much of technology) has become the fashion business. If true, this is very bad for Apple.
“On the sliding scale of coolness, teens place most adults firmly on the uncool side. It goes without saying that no teen wants to show up dressed identically as the science teacher. And unfortunately for Apple, this teen logic may also apply to smartphones. They don’t want to same device as their mom, dentist, and coffee barista.”
8. The Chinese smartphone invasion begins
Smartphones will rapidly commoditize, thanks in part to the overwhelming market share of Android. This should drive prices (and margins) down fairly quickly. I don’t see the inherent benefit of a ‘name brand’ smartphone if the features are there and the price is right.
“Tech giants Apple, Google, and Microsoft were no-shows at CES this week in Las Vegas, which worked out just fine for Chinese vendors looking to establish a name for themselves with U.S. consumers. Telecom suppliers Huawei and ZTE, in particular, have set their sights on breaking into the U.S. market for smartphones and tablets.”
9. Google’s ultrafast Internet draws startups to KC
This is entirely predictable: businesses which need water set up shop near lakes and rivers, businesses which need cheap electricity set up shop where electricity is cheap. I have no doubt whatsoever that the focus of new technological products (i.e. not just entertainment and social networking) will require fast, affordable web service. Where does this leave countries like Canada?
“Inside a small bungalow on the street separating Kansas City, Kan., from its sister city in Missouri, a small group of entrepreneurs are working on their ideas for the next high-tech startup, tapping Google Inc.’s new superfast Internet connection that has turned the neighborhood into an unlikely settlement dubbed the “Silicon Prairie.””
10. China tackles last-mile fiber problem, decrees all new homes must have it
This sort of building code change makes a lot of sense however it would take many decades to have a measurable impact on availability of fibre. A regulatory regime which encourages, or even requires, services to be made available at a reasonable cost makes more sense.
“But in China, the word is a new government policy from the Ministry of Industry and Information Technology will require, according to the state-run China Daily, that “all newly built residences, if they are located in counties and cities where a public fiber optic telecom network is available, have to be equipped with fiber network connections.”
11. In The Fight Between Netflix And Cable Operators, High-Quality Streaming Video Is Being Held Hostage
Fundamentally, ISPs should be competitive with cable, telephone, and wireless companies, but due to poor regulation, most are also in those businesses. The cable/telephone/mobile business model is irrelevant, but the privileged positions those companies (especially as ISPs) hold remains.
“One cable provider is arguing that because Netflix isn’t offering it Super HD or 3D content, that it is essentially discriminating against ISPs based on whether they deploy Open Connect boxes.”
12. Facebook loses 1.4 million active users in U.S.
I have seen a number of similar data points for different countries in the past few days. Perhaps the bloom is off the Facebook rose (I wouldn’t know since I am not a member) or, maybe, they have managed to purge the numerous false users.
“The number of Americans using Facebook fell by nearly 1.4 million in early December, according to new data from social media monitoring company SocialBakers. While Facebook FB -2.74% has more than 167 million users in the U.S. and 1 billion worldwide, the recent drop in monthly active users is still akin to losing the entire population of San Antonio, Texas.”
13. Stanford Battery Lasts 5X Longer
Yet another quantum advance in battery technology. This and the silicon anode technology sounds encouraging, however, cost is an important consideration and nano-materials are currently expensive to produce.
“SLAC and Stanford scientists have set a world record for energy storage, using a clever “yolk-shell” design to store five times more energy in the sulfur cathode of a rechargeable lithium-ion battery than is possible with today’s commercial technology. The cathode also maintained a high level of performance after 1,000 charge/discharge cycles, paving the way for new generations of lighter, longer-lasting batteries for use in portable electronics and electric vehicles.”
14. OLED and 4K at CES 2013: The fantasy and the reality
Given a choice, I’d pay an extra $1,000 for an OLED TV than a 4K TV, but the spreads are about 10x and 20x that right now. Both are spectacular, but the gamut and contrast on OLED is awesome. I believe OLED has significant potential for cost reduction, possibly below the cost of LCD.
“… according to the vast majority of Las Vegas cab drivers I’ve surveyed this week, 4K and OLED sets are what most CES showgoers are talking about, too. All that attention is warranted. If you’ve seen an OLED or 4K set in action, you probably want one. If you want one, you probably can’t afford one. And if you can afford one, you probably should be watching it right now instead of reading this story. Shame on you, moneybags.”
15. UV Light Emitting Machine Disinfects Hospital Rooms In Minutes
UV light is commonly used to sterilize things so it is a bit surprising to hear that somebody had to come up with this idea. Even a ‘robot’ seems superfluous: a set of moving UV lamps on a time should be enough to clear an infected room.
“It’s a staggering modern-day irony that the most common complication for hospital patients is acquiring an infection during their visit, affecting 1 in 20 patients in the US. It’s a problem estimated to cause millions of infections with 100,000 or so leading to death per year and a whopping $45 billion annually in hospital costs. If this isn’t bad enough, the tragedies from deadly superbugs within healthcare facilities are on the rise and will likely continue as the last lines of antibiotics fail without any new drugs moving fast enough up the pipeline to help. Fortunately, an alternative to medication promises to vastly improve the disinfection of hospital rooms, thanks to a UV light-emitting robot from Xenex Healthcare.”
16. Toshiba creating nuclear reactor for mining Canada Tar Sands
This makes perfect sense from a number of perspectives, including an environmental one. Modern nukes are far safer than the Gen 0 and Gen 1 plants behind historical disasters, though I admit the environmentalist has a point about a combined earthquake and tsunami (I suspect the cause of a tsunami in Alberta would be greater concern than the wave itself, and I do not believe Alberta is exactly earthquake prone). In any event, I predict any actual deployment of nuclear technology will be vocally opposed by the usual collection of celebrities and starlets, whatever its merits.
“Nikkei reported this week that the company had completed design of a small 10,000kw reactor and had asked the U.S. Nuclear Regulatory Commission for approval to begin construction in the United States, but the process had been delayed in connection with a meltdown at Japan’s Fukushima Daiichi nuclear power plant in 2011. The company also planned to seek approval from Canadian authorities.”
17. Paul Krugman is Wrong about the Rise of the Robots
The author (and Krugman) both have disparate political orientations which no doubt frame their opinions. Plus, both come at it from a typically American perspective – blithely ignorant of the possibility other economic arrangements even exist. Realistically, every ‘labor saving machine’ has engendered fear and created economic displacement, and yet we live as kings did a couple centuries ago: with the obvious exception of weaponry, progress is generally good and uplifting for the broader population.
“In a recent post, Krugman says the following: Smart machines may make higher GDP possible, but also reduce the demand for people — including smart people. So we could be looking at a society that grows ever richer, but in which all the gains in wealth accrue to whoever owns the robots. I think there is a fundamental problem with this way of thinking: as jobs and incomes are relentlessly automated away, the bulk of consumers will lack the income necessary to drive the demand that is critical to economic growth.”
18. Nokia releases 3D printer kit for home-made Lumia 820 cases
A surprisingly intelligent move out of Nokia albeit one which will probably find few adopters due to the early stage of the 3D market. You can bet more and more companies will embrace the potential promotional advantages of 3D printing while an even greater number try to litigate.
“Nokia has published the files necessary for people to 3D print their own Nokia Lumia 820 cases. Harking back to the days of the 3310, when interchangeable fascias were the height of cool and the Baha Men were stumped over who allowed some canines to escape, the files allow you to design your own case for the Windows Phone phone.”
19. Could Some Midwest Land Support New Biofuel Refineries?
Every objective study I have seen suggests biofuels consumed more energy to produce than they deliver. In other words, it takes more than one litre of fuel to grow, harvest, transport, and process one liter of biofuels. This strongly suggests biofuel subsidies are not environmentally positive (because they cause a net drawdown on fossil fuels) but simply a cash cow for agribusiness.
“If you were to take every gram of crops produced anywhere in the world for all purposes — and that includes every grape, every ton of wheat, every ton of soybeans and corn — and you were to use that for biofuels and essentially stop eating, those crops would produce about 14 percent of world energy.”
20. How a ‘model’ employee got away with outsourcing his software job to China
This is an amusing ‘real life’ incarnation of a Dilbert cartoon. The company he works for probably outsources customer service to India, so he is just beating them at their own game The net outcome of this amusing episode will most certainly be the employer’s loss of a good manager whi they thought was a developer.
“Bob was his company’s best software developer, got glowing performance reviews and earned more than $250,000 a year. Then one day last spring, Bob’s employer thought the company’s computer system had been attacked by a virus. The ensuing forensic probe revealed that Bob’s software code had in fact been the handiwork of a Chinese subcontractor.”