The Geek’s Reading List – Week of November 1st 2013
I am an analyst and consultant with 20 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.
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1. Bright Lights, Big City: NYC Swapping All 250,000 Street Lights To LED
I was an early proponent of LEDs for general purpose lighting, however the street lamp market is pretty compelling not so much due to energy savings but the fact the much longer lives of LED streetlamps result in enormous savings in expensive, unionized labor for semi-annual replacement.
“New York City will be seen in a whole new light over the next few years, as an effort to switch to LED street lights continues. Mayor Michael Bloomberg announced all of the city’s 250,000 street lights will be changed over to light-emitting diodes in a four-year initiative.”
2. Opinion: A Wolf in Sheep’s Clothing
Scientists and science journalist are being increasingly open about major flaws in much of the data and ‘known knowns’ assumed true for many decades. Of course, science is self-correcting and remains the best method for uncovering the mysteries of nature, however, flawed research can lead other researchers down the rabbit hole, and the current environment leads to a situation where the overwhelming majority of published, peer-reviewed research is flat out wrong, a situation which benefits no one. Fortunately, articles such as these should lead to eventual solutions.
“Recently, I was the lead author on a paper demonstrating that about 40 years and many millions of dollars of US nutritional surveillance data were fatally flawed. In most research domains, such a finding might be monumental; yet in nutrition epidemiology—the study of the impact of diet on health, hereafter referred to simply as “nutrition”—these results are commonplace. In fact, there is a large body of evidence demonstrating that the systematic misreporting of energy and macronutrient intake renders the results and conclusions of the vast majority of federally funded nutrition studies invalid.”
3. Mixing Nanoparticles to Make Multifunctional Materials
A really interesting approach especially for prototyping novel materials. As usual, the scalability of the process (and cost) is an important question. After all, there is nothing revolutionary about a material which can only be made, at huge cost, in small quantities. Thanks to my friend Duncan Stewart for this article.
“Scientists at the U.S. Department of Energy’s Brookhaven National Laboratory have developed a general approach for combining different types of nanoparticles to produce large-scale composite materials. The technique, described in a paper published online by Nature Nanotechnology on October 20, 2013, opens many opportunities for mixing and matching particles with different magnetic, optical, or chemical properties to form new, multifunctional materials or materials with enhanced performance for a wide range of potential applications.”
4. Graphics Chips Help Process Big Data Sets in Milliseconds
No doubt this will be promoted by those bullish on the prospects for the moribund Graphics Processing Unit (GPU) industry as opening up new vistas for the devices. Unfortunately, that is not likely to be the case: exactly how many people or companies need to, or want to, do this sort of processing? The answer is approximately none relative to the number of gamers using the devices. So GPU may transform ‘big data’, but ‘big data’ is not going to have a measurable effect on demand for GPUs. (Also, see item 20).
“New software can use the graphics processors found on everyday computers to process torrents of data more quickly than is normally possible, opening up new ways to visually explore everything from Twitter posts to political donations.”
5. New Simple.tv pricing, features revealed: DVR for cord cutters will retail for $250
There have been one or two Over The Air (OTA) PVRs on the market, however, little was done to really promote them. Given the growing number of ‘cord cutters’ abandoning usurious cable TV fees, Simple.tv may be a product whose time has come.
“Simple.tv’s new DVR for cord cutters will come with a sticker price of $250 and go on sale in mid-December, according to a product page on Newegg.com.”
The failure of early generation reactors at Chernobyl and Fukushima have cast a pall on the nuclear power industry. Later generation reactors are inherently safe and some designs are not even capable of producing material for weapons. Here is one such design, bankrolled by none other than Bill Gates.
“TerraPower’s Generation IV traveling wave reactor (TWR) offers a safe and economic form of low-carbon energy that meets base load demand for electricity. It offers enormous environmental benefits, high barriers to proliferation, and uninterrupted energy security that significantly address many of the issues faced by today’s reactors.”
7. Are online comments full of paid lies?
This is an annoying trend, but actually entirely consistent with ‘mainstream’ advertising, which has raise the art of lying and misdirection to high art. After all, when some half-wit celebrity endorses a product, it is their fee and not their life experience which is talking. The advantage of the Internet was that ‘real’ people and not shills gave opinions, at least for a while. I find forums useful because discussions about products tend to be dialogues and shill get shouted down.
“Taiwan’s Fair Trade Commission this week fined Korean conglomerate Samsung $340,000 for “astroturfing.” Specifically, the Taiwanese FTC said Samsung paid two “marketing firms” more than $100,000 to hire people to “highlight the shortcomings of competing products,” engage in the “disinfection of negative news about Samsung products,” positively review Samsung products and, (in a bizarre turn of phrase), do “palindromic Samsung product marketing,” whatever that means.”
8. Windows 8 Adoption Slows Ahead Of Windows 8.1
The article reads as though the writer is very keen on promoting Windows 8 (and 8.1) and hardly sounds objective. Given the market reaction to Windows 8, and the near complete rejection by business users, it is hard to believe anybody is champing at the bit for Windows 8.1.
“Windows 8 expanded its desktop market share only modestly in September, its last full month before Windows 8.1 hits the market, according to the newest figures from Web tracking firm Net Applications. Microsoft’s newest OS placed third overall, behind first-place Windows 7, which actually gained more users in September than Windows 8 did, and Windows XP.”
9. Why is broadband more expensive in the US?
It is worth noting the OECD figures are unreliable – my analysis showed they were derived from advertised cost and claimed speeds. At least in Canada, only the Federal government and the OECD believe claimed speeds are even remotely associated with actual bandwidth. Actual, measured speeds in the US and Canada are generally much (i.e. 50%) lower.
“Home broadband in the US costs far more than elsewhere. At high speeds, it costs nearly three times as much as in the UK and France, and more than five times as much as in South Korea. Why? Men’s haircuts, loaves of bread… it is surprising how much more expensive some things are in the US than the UK. Now home broadband can be added to that list.”
10. Hardware is now open (sourced) for business
An overview of the trend toward open source hardware by a member of the ‘mainstream media’. You know a trend is well entrenched when CNBC mentions it.
“The open-source hardware movement is migrating from the garage to the marketplace. Companies that follow an open-source philosophy make their physical designs and software code available to the public. By doing so, these companies engage a wave of makers, hobbyists and designers who don’t just want to buy products, but have a hand in developing them”
11. Motorola announces Ara, an open hardware project to create customizable smartphones
It is hard to fathom the benefit of this approach, but it has moved from a crazy crowd funded concept to a project supported by Motorola/Google.
“If you thought Motorola and its Moto X Maker helped you customize a unique smartphone, then prepare for even more. The Google-owned company has just announced Ara, a hardware platform that is entirely open to customization — essentially letting tinkerers develop their own smartphones.”
12. Chinese appliances are shipping with malware-distributing WiFi chips
That’s one way of supporting low prices: enable fraud by embedding piracy tools in your products. For anybody who has ever tried to get a legitimate product with embedded WiFi to log into a network, you know how frustrating it can be but these devices apparently manage to do it all by themselves. These guys should ‘go legit’.
“Was the iron in the last hotel room you stayed in made in China? Bad news: it may have been hiding an insidious little chip designed to infect your computer with spam-serving malware.”
13. The Government wants to teach all children how to code. Here’s why it’s a stupid idea
I tried to find the background of the author Willard Foxton, but I could not confirm whether he is a completely uneducated lout, or simply an arts graduate. His assertion that programmers are “dull weirdos” suggests either is likely the case. Most engineers and programmers have wide interests, spanning numerous domains, often including the arts (in particular music). “Dull weirdos” is a phrase which evidently can apply to some journalists, however.
“As a subject, it only appeals to a limited set of people – the aforementioned dull weirdos. There’s a reason most startup co-founders are “the charming ideas guy” paired with “the tech genius”. It’s because if you leave the tech genius on his own he’ll start muttering to himself.”
14. Apple censors Lawrence Lessig over warranty information; iOS 7 mess grows
This is one way to make sure that people are satisfied with your products: censor any discussion of fiascos such as this one. Perhaps Apple hasn’t heard of the “Internet”, which is a novel medium which ensures their fiasco, and associated censorship, will not go unnoticed (except, perhaps, by fanboys).
“A significant number of Apple users have lost Wi-Fi functions after its glitch-ridden iOS 7 update. Ignored since September, Apple Support Communities members are now watching their solutions be deleted by Apple. And according to Lawrence Lessig, Apple is also preventing its users from posting innocent questions about the deletions.”
15. Exclusive: Intellectual Ventures faces novel attack on patent business
I can’t imagine this legal theory will be accepted. After all, if the law were to decide that something was only worth what somebody paid for it, the same could apply to mineral exploration claims. Regardless, I thought the fact Intellectual Ventures has only raised $3 billion from $6 billion in investment pretty revealing. Of course, there is always the possibility the real payoff is the ancillary benefit of crippling competitors of its investors (including Microsoft, Intel, Sony, Nokia, Apple, Google, Yahoo, American Express, Adobe, SAP, Nvidia, and eBay)
“Seven years ago, Intellectual Ventures bought a patent on technology that helps detect malicious software embedded in digital content. The price? $750,000. Now Intellectual Ventures is arguing in a Delaware courtroom that Internet security firms Symantec and Trend Micro should pay roughly $310 million combined for a license to that patent through the end of last year.”
16. Big data heralds return of the Cray supercomputer
Meh – I am not sure I buy the thesis. With the US government responsible for 2/3rds of revenue it seems more likely growth (if any emerges over the long term) will be a consequence of a paranoid national surveillance state than legitimate business applications.
“”The assumption was that supercomputers were cliche five years ago. People thought, ‘I can run my simulation on my laptop’,” said Barry Bolding, a Cray vice president, at the company’s Seattle headquarters last week. “That may have been true, so long as the data associated wasn’t growing as well. But raw data is being created in exabytes as we sit here. More data means bigger computer, bigger computer means more data.”
17. Does anyone really want smartwatches?
I believe smartwatches are more of an Internet meme than a product category. The fanboy hysterics over the ever-looming launch of the Apple iWatch takes as a given the idea that people are champing at the bit for yet another redundant gadget. Frankly I’ll believe it when I see it.
“We have covered smartwatches with increasing frequency over the past year here at BGR, and almost every time we do, we can’t help but wonder what exactly is behind the surge in interest. Most recent offerings seem like an answer to Apple’s “iWatch,” which doesn’t even exist yet, of course. Samsung’s Galaxy Gear in particular feels like a rushed product that had no business launching in its current state. Logic suggests that smartphone vendors are desperately searching for the “next big thing” as high-end, high-margin smartphone and tablet sales slow. But countless market research firms still seem to think smartwatches sales are indeed set to explode. According to a new report, however, consumers aren’t buying it.”
18. Amazon’s top reviewers get free products in exchange for write-ups
This would be news is it were not for the fact this has been standard practice for newspapers, magazines, etc., for decades. The major difference is that Amazon discloses the conflict whereby those other media rarely do. (It is one reason Consumer Reports buys cars rather than borrows them from their biggest advertizers).
“Amazon’s customer reviews aren’t all put together by thoughtful buyers: as it turns out, Amazon has a program that sends free products to some of its top-ranked reviewers in exchange for a write-up. The program is called Amazon Vine, and though it’s been running since 2007, a new NPR report is bringing it some renewed attention. “I’ve had everything from very cheap earbuds, to $500 multifunction laser printers,” Michael Erb, Amazon’s current top ranked reviewer, tells NPR. “I’ve gotten a spin bike, which is probably valued at closer to $1,000.””
19. IDC: Apple’s iPad fell to 29.6% tablet share in Q3 2013, Samsung took second with 20.4%, Asus third with 7.4%
I always caution readers regarding industry research, which usually has little value. The market share figures might be interesting, though. With segment growth beginning to moderate, the obvious strategy for new entrants is to discount, a move which will have to be matched by market leaders. Expect extreme pricing pressure in this space (and smartphones).
“The tablet market is still growing. Q3 2013 saw 47.6 million units ship worldwide, up from 34.8 million the same quarter last year. Apple’s iPad once again took first place, although it dropped to 29.6 percent market share, while Samsung grew its share to 20.4 percent to keep second place. The other three players in the top five also all grew: Asus kept its third place position by grabbing 7.4 percent, Lenovo jumped to 4.8 percent to take fourth, and Acer took fifth with 2.5 percent. Amazon notably fell out of the list.”
20. If you are considering a video card upgrade, look at your monitor first
A reality check for those who believe demand for ever more powerful GPUs will continue forever. In any interface application you run into the sad reality that your senses have practical limits, and, as a consequence, past a certain point you get minimal benefit from incremental performance. I’d argue that time has already passed for GPUs, but it is arguable it ends with the current generation. The interesting thing is this puts a ‘hard limit’ on how powerful cheap, integrated graphics need to be, meaning a commercially viable discrete GPU market should pretty much disappear within the next five years or so.
“While CPU performance seems to be leveling off, GPU performance continues to rise at a considerable pace, with each generation leaving the last generation in the dust. That may be great for gamers and graphics professionals, but depending on the monitor you use, there might be no point in upgrading any more.”