The Geek’s Reading List – Week of March 7th 2014
I have been part of the technology industry for a third of a century now. For 13 years I was an electronics designer and software developer: I designed early generation PCs, mobile phones (including cell phones) and a number of embedded systems which are still in use today. I then became a sell-side research analyst for the next 20 years, where I was ranked the #1 tech analyst in Canada for six consecutive years, named one of the best in the world, and won a number of awards for stock-picking and estimating.
I started writing the Geek’s Reading List about 10 years ago. In addition to the company specific research notes I was publishing almost every day, it was a weekly list of articles I found interesting – usually provocative, new, and counter-consensus. The sorts of things I wasn’t seeing being written anywhere else
They were not intended, at the time, to be taken as investment advice, nor should they today. That being said, investors need to understand crucial trends and developments in the industries in which they invest. Therefore, I believe these comments may actually help investors with a longer time horizon. Not to mention they might come in handy for consumers, CEOs, IT managers … or just about anybody, come to think of it. Technology isn’t just a niche area of interest to geeks these days: it impacts almost every part of our economy. I guess, in a way, we are all geeks now. Or at least need to act like it some of the time!
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. Or feel free to email me to discuss any of these topics in more depth: the sentence or two I write before each topic is usually only a fraction of my highly opinionated views on the subject!
This edition of the Geeks List, and all back issues, can be found at www.thegeeksreadinglist.com.
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1. Wash U, U of I Scientists Use 3-D Printer To Help Create Prototype Next-Gen Pacemaker
There seems to be an increasing number of medical applications for 3D printer, though it is hard to tell which, if any, will become mainstream. This device is rather interesting, but I don’t know enough about pacemakers to understand the pros and cons. It would seem to me the installation of this device would almost certainly be a more invasive, and therefore dangerous, surgery than for existing pacemakers.
“Researchers at the University of Illinois at Urbana-Champaign and Washington University in St. Louis have developed a new device that may one day help prevent heart attacks. Unlike existing pacemakers and implantable defibrillators that are one-size-fits-all, the new device is a thin, elastic membrane designed to stretch over the heart like a custom-made glove.”
2. Google and Postini: Why You Should Avoid Google as a Business Technology Supplier
This entrepreneur’s blog post focuses on the hazards of using Google as a business technology supplier, be he seems to miss the broader point that this is a general issue with using any cloud services of any kind for business or personal use. If, for example, you install Microsoft Office, you will be able to access your local files as long as your computer is functional. Even then, you have your files and you could almost certainly find a computer or compatible software which would allow you to access those files. If, on the other hand, your cloud services provider goes out of business, is hacked, discontinues the service, etc., you are simply out of luck.
“My company is probably one of the longest users of Postini, a service Google acquired a few years back that was designed to combat malware on Exchange and other business mail systems. Postini could be sold as a standalone product or provided as a service provider offering. The company decided to discontinue support for service providers likely to eliminate support for services that competed with Google Mail.”
3. How do the chemical ghosts of dinosaurs help their preservation?
Time was ancient fossils were considered to be, pretty much, stone casts of the bones of long dead critters. Then they found that that residual chemistry for things like pigments sometimes persist, allowing colours to be determined. Even more recently it was discovered that actual biological tissue might remain, tens of millions of years after death. The mummified hadrosaur looks pretty cool if you ask me.
“For some years now, Mary Schweitzer and her team have been researching the idea that organic molecules can be preserved for millions of years, specifically within dinosaurs. They have used a plethora of chemical and biotechnological techniques to demonstrate that, within animals like Tyrannosaurus rex, it is possible to find the residue of structures such as blood vessels and even proteins. Naturally, her research has been met with a whole wad of stiff resistance from the scientific community, seemingly for no other reason than “We don’t like the sound of that..”. Scientific rigour ftw!”
4. LibreOffice: ignore Microsoft’s “nonsense” on government’s open source plans
Microsoft seems to believe consumers and businesses still have the same computer literacy they had in the 1990s. Examples such as this and its “switch from XP to Windows 8 or 9” campaign demonstrate (item 12) the company has the same level of obliviousness as a Toronto mayor.
“The makers of LibreOffice have slammed attempts by Microsoft to derail the government’s move to open source, accusing the company of protecting its own interests rather than users.”
5. 20,000 megawatts under the sea: Oceanic steam engines
Newscientist thrives off ‘alternate energy’ stories and I found this one rather interesting. In real life, the ocean is prone to things like massive waves and so on, so ‘scaling up’ to real world applications is generally a lot harder than expected. Consider the staggering cost of a deep water oil platform, and their occasional demise. A generating platform or even 1,000 meter siphon, would necessarily be much larger, much more expensive, and much more vulnerable.
“The idea is brilliant. The ocean is a massive and constantly replenished storage medium for solar energy. Most of that heat is stored in the top 100 metres of the ocean, while the water 1000 metres below – fed by the polar regions – remains at a fairly constant 4 to 5 °C.”
6. Early Treatment Is Found to Clear H.I.V. in a 2nd Baby
This sounds awfully encouraging, though it would be even more encouraging if you could convince ‘at risk’ mothers to get adequate healthcare.
“When scientists made the stunning announcement last year that a baby born with H.I.V. had apparently been cured through aggressive drug treatment just 30 hours after birth, there was immediate skepticism that the child had been infected in the first place. But on Wednesday, the existence of a second such baby was revealed at an AIDS conference here, leaving little doubt that the treatment works. A leading researcher said there might be five more such cases in Canada and three in South Africa.”
7. Red Hat programmer discovers major security flaw in Linux
Not to panic, though – apparently, this is an old bug which was detected and eliminated, then reintroduced, so you have to wonder whether it was an accident or intentional (i.e. the NSA effect). One cannot help but believe people will be paying closer attention in the future.
“Programmer Nikos Mavrogiannopoulos who works for Red Hat, has discovered a major security problem with the Linux operating system—a bug that could allow a hacker to create a certificate that could bypass the normal authenticity checks. Red Hat sent out an immediate alert and suggests all those who use its product update their software with a fix they’ve made available.”
8. Canadian police investigating after bitcoin bank Flexcoin folds
As Bitcoin “thefts” go this is hardly newsworthy, except for the comments by the lawyer, who speaks for the Bitcoin Alliance of Canada while making a comment to the effect that, if you lose your Bitcoin, you are plumb out of luck. No mention is made of potential criminal charges, etc. Hmmm.
“Flexcoin users who lost bitcoins in the hack will likely have little recourse to recoup their funds, though one option may be a class action lawsuit like the one being considered against Mt. Gox, said Stuart Hoegner, a Toronto-based lawyer and general counsel for the Bitcoin Alliance of Canada. “Short of a class action, people might find the burden of pursuing litigation to be something that’s not very attractive,” he said.”
9. Kia rejects Li-ion for Pb-carbon in hybrid car
It is unclear to me whether this is a ‘real’ Kia product or yet another one of those stupid concept cars. I had never heard of Lead/Carbon batteries before so I figured this was newsworthy. Not also the comment at the end regarding problems associated with Lithium Ion batteries in cold weather, so you had better keep your Tesla in a heated garage.
“The system is aimed at ‘mild hybrids’ with a small electric motor that can increase the engine’s power output, and allows a car to be driven in an electric-only mode at low speeds to cut exhaust emissions.”
10. 2014’s smartphone slowdown is extremely painful for Apple
Treat any industry analyst research as, at best, a biased guess. That being said, it is usually very bullish and any forecast of rapidly decelerating growth is probably worth paying attention to. Apple has a premium brand and high margins and so slowing growth would likely impact Apple worst of all. Furthermore, they are suggesting lower unit growth, and this usually is accompanied by lower average selling prices and lower margins. On this basis I would be surprised if revenues actually grow this year.
“Globally, IDC sees smartphone unit growth dropping to under 20% in 2014. This may not seem like a weak figure compared to the death throes of the PC market, but the smartphone industry has grown utterly dependent on 40%-plus annual growth over the past decade. It’s the steepness of the growth rate decline that made the adjustment to the sudden 2001 mobile phone slowdown so painful, sending operating margins of all vendors plunging during that chilling year.”
11. Imagination Tech shipments hit by smartphone slowdown
It is hard to tell whether this small firm’s troubles are directly associated with an expected slowdown of the smartphone market (see item 10), however, this data point does support that thesis. Be on the lookout for cautionary guidance from other smartphone semiconductor vendors as we move into the summer.
“Imagination Technologies has downgraded its forecast for shipments of chips containing its graphics and video technology because of lower than expected sales of top-end smartphones.
12. Windows 9 Expected To Push Consumers Off Windows XP
The headline is nonsense: unless Windows 9 requires less computing resources than Windows 7 and all manner of driver support back to 10 year old hardware, few people are going to replace Windows XP with Windows 9 unless they are also willing to throw out all their hardware, including, most likely, their printers, scanners, and so on. Nonetheless, I am interested in Windows 9 just to see if Microsoft tries to make nice with its customers or further alienate them as per Windows 8.
“Windows 9 is probably one of the most talked about topics as of late. So far we’ve heard two release windows for the rumored platform: Fall 2014 and Spring 2015. The latter date has lingered around for a bit, while the Fall release window suggests that Microsoft may be itching to move away from Windows 8.”
13. Implementing Technology to Improve Public Highway Performance: A Leapfrog Technology from the Private Sector Is Going To Be Necessary
Policy makers and the public are becoming increasingly aware of self-driving cars (see item 19, below). I believe this technology will transform our economy, and mostly for the better, unless you are as cab or truck driver. The technology will lead to leaner supply chains, less death and injuries from collisions (with corresponding reduction of medical costs), disruption of the insurance industry, better use of infrastructure, and so on. The real question is when adoption will actually begin.
“Because policymakers have not implemented those existing technologies, the authors believe the driverless car will have to leapfrog ahead of the technology on government-run highways to improve highway performance. They note that the technology, with a 10 percent adoption rate, would reduce fatalities and injuries, save travel time and fuel – and save $40 billion annually. At a 50 percent adoption rate, it would save $200 billion per year. The promise of the cars will allow virtually all of the benefits of the above-listed technologies to come to fruition in spite of government foot-dragging.”
14. A Powerful New Way to Edit DNA
I find it hard to wrap my head around what, exactly, they are doing, and how it works, but it is easy to see that repairing defective genes (or ‘improving’ perfectly good ones) would be a powerful tool for good or evil.
“In the late 1980s, scientists at Osaka University in Japan noticed unusual repeated DNA sequences next to a gene they were studying in a common bacterium. They mentioned them in the final paragraph of a paper: “The biological significance of these sequences is not known.” Now their significance is known, and it has set off a scientific frenzy.”
15. Gartner: 195M Tablets Sold In 2013, Android Grabs Top Spot From iPad With 62% Share
I repeat my caution regarding taking industry research – even historical figures – as gospel. Nonetheless, it is interesting that, while tablet unit sales increased 68%, Apples sales only grew 14.5%. Of course, Apple probably made more money on its shrinking market share than the rest of the industry did, but tablets and smartphones are not an inherently profitable product so margins should move to minimal levels as growth slows.
“A new tipping point in the world of tablets: today the analysts at Gartner have released their tablet sales numbers for 2013, and Android has topped the list for the most popular platform for the first time, outselling Apple’s range of iPad tablets nearly twofold. Of the 195 million tablets sold in 2013, Android took nearly 62% of sales on 121 million tablets, while Apple sold 70 million iPad tablets for a 36% share.”
16. 5-Year-Olds Can Learn Calculus
I went to business school with a guy who had been a math professor at UCLA. He told me they had developed an experimental program to teach children calculus and it worked, provided the teachers truly believed kids could learn calculus. Of course, that is probably the limiting factor: how many math teachers have been exposed to enough math to understand calculus, let alone teach it?
“The familiar, hierarchical sequence of math instruction starts with counting, followed by addition and subtraction, then multiplication and division. The computational set expands to include bigger and bigger numbers, and at some point, fractions enter the picture, too. Then in early adolescence, students are introduced to patterns of numbers and letters, in the entirely new subject of algebra. A minority of students then wend their way through geometry, trigonometry and, finally, calculus, which is considered the pinnacle of high-school-level math.”
17. Batteries: What’s here versus what we need
Batteries are always very topical, especially in light of the Elon Musk effect. One always has to tread carefully when reading even slightly skeptical articles such as these. For example, for grid storage you need low price and durability and you currently have neither: lithium ion batteries are short lived, especially if they are used, and it they aren’t used, they why do you need them? I also have grave doubts on ‘super charging’ – unless this implies switching out the battery pack – because of the stress on the battery pack, let alone the local grid.
“The modern battery is largely keeping pace with our needs. But two other big potential users of batteries—the electric grid and automobiles—haven’t really found the better technology they need. Based on a panel discussion at this year’s meeting of the American Association for the Advancement of Science, that’s more of a challenge than it sounds, since the two battery uses need very different things.”
18. Drone pilot wins case against FAA
This is being reported by some as legal breakthrough in the use of drones. The problem is that a drone, or even a model airplane, can do a lot of damage, so visions of an unregulated market where the skies are thick with drones is simply not going to happen. Government regulation will catch up, eventually.
“The judge has dismissed a proposed $10,000 fine against businessman Raphael Pirker, who used a remotely operated 56-inch foam glider to take aerial video for an advertisement for the University of Virginia Medical Center. The FAA alleged that since Pirker was using the aircraft for profit, he ran afoul of regulations requiring commercial operators of “Unmanned Aircraft Systems” — sometimes called UAS or drones — to obtain FAA authorization. But a judge on Thursday agreed with Pirker that the FAA overreached by applying regulations for aircraft to model aircraft, and said no FAA rule prohibited Pirker’s radio-controlled flight.”
19. Would we ever ban human driving?
A rather thoughtful blog post on the subject of self-driving cars. I disagree with his view regarding the speed of uptake, however, he does raise some very good points otherwise. One thing to consider is the fact that the population is aging in many developed countries and this may speed adoption of the technology in places like Japan in particular.
“While my own personal prediction is that robocars will gain market share very quickly — more like the iPhone than like traditional automotive technologies — there will still be lots of old-style cars around for many decades to come, and lots of old-style people. History shows we’re very reluctant to forbid old technologies. Instead we grandfather in the old technologies. You can still drive the cars of long ago, if you have one, even though they are horribly unsafe death traps by today’s standards, and gross polluters as well. Society is comfortable that as market forces cause the numbers of old vehicles to dwindle, this is sufficient to attain the social goals.”
20. 7 Trillion Devices Will Need High Speed Access By 2020
This is an ‘Internet of Things’ (IoT) story, hence the ‘7 trillion’ figure, which is downright silly: 7 trillion is 1,000 devices high speed devices for every person on the planet. Setting aside that absurd figure, only a small portion of IoT devices will be directly connected to the Internet, let alone 3G or 4G networks – most will exist on local networks and be accessible via the cloud or some other mechanism. Even the vast majority of wireless devices will use WiFi or emerging IoT centric wireless standards using unlicensed bands.
“At a recent seminar jointly organised by the Enterprise Europe Network South West (EEN SW), Business West and The UK’s Technology Strategy Board Mark Beach, Professor at the University of Bristol predicted that by the year 2020, over 7 Trillion devices would be connected to the global mobile network, and that the current 3G and 4G technology will simply not be able to cope.”