The Geek’s Reading List – Week of June 27th 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.
1) Schultz advocates large-scale testing of self-driving cars on Dutch roads
This looks like a promising development for self-driving cars. I don’t know enough about Dutch politics to hazard a guess as to whether this proposal is likely to be adopted, however, the sponsorship of a minister is probably a strong indication it will be. Another factor might be the nature of Dutch law regarding the apportionment of blame and damages in the event of a traffic accident. Collisions with self driving cars are bound to happen regardless of how good the technology gets, and one can imagine tort lawyers are smacking their lips over the prospects.
“Minister Schultz van Haegen: “The age of self-driving cars has arrived. Developments in this field will change the relationship between driver and vehicle more in the next twenty years than anything in the past one hundred years did. I want us as the Netherlands not only to be ready, but also to be at the vanguard of this innovative development internationally. Self-driving cars will make a positive contribution to the flow of traffic and to the safety of our busy road network. Moreover, self-driving cars are more economical which is good for us as well as the environment.”
2) EU launches attack against corporate tax avoidance
Frankly it is hard to understand how governments let corporations get away with this, at least outside the US. The EU is a particularly odd place because certain members more or less actively promote tax avoidance as a business model. The reason I mention this article in a tech newsletter is that, if enacted properly, cash taxes paid by industry titans would skyrocket, which would ultimately impact valuation. I favor a ‘general tax-avoidance’ law which would criminalize cheating as well as levy astronomical fines.
“The EU has taken steps to curb tax avoidance by global corporations. In recent months, criticism in the budget-strapped bloc has mounted over tax loopholes exploited by companies such as Apple, Google and others.”
3) Russia wants to replace US computer chips with local processors
With (likely well-founded) rumors of ‘back doors’ in Intel and AMD processors, the current tensions between Russia and the West makes this move long overdue. Perhaps the same thing would have happened if the Snowden/NSA revelations had not occurred because you have to believe Russian intelligence was well aware of what was going on. Regardless, other countries, in particular much of the Muslim world, are probably asking themselves whether the Russians would be more trustworthy suppliers than the US. As a side note, ARM processors are not a good market for Microsoft Windows, and any such ‘home brew’ Russian systems will likely run Linux.
“Russia’s Industry and Trade Ministry plans to replace US microchips Intel and AMD, used in government’s computers, with domestically-produced micro processor Baikal in a project worth dozens of millions of dollars, business daily Kommersant reported Thursday.”
4) Canada implements world’s first national Bitcoin law
This seems like a pretty well reasoned and balanced law. While not making Bitcoin legal tender it does require dealers and transaction processors to follow the same anti-money laundering provisions as anybody else, including the local foreign exchange dealer. While the law seems to make sense, I wish I could say the same about the lawyer’s brief comments at the end: is it the role of anti-money laundering laws to foster entrepreneurship? Quite the opposite, depending on the business you are starting.
“At the end of this week, the Parliament of Canada quietly implemented what is likely the world’s first national Bitcoin law, and certainly the world’s first treatment in law of Bitcoin under national anti-money laundering law. Late Thursday, Canada’s Governor General gave Royal Assent to Bill C-31, An Act to Implement Certain Provisions of the Budget Tabled in Parliament on February 11, 2014 and Other Measures (“Bill C-31“). Bill C-31 amends Canada’s Proceeds of Crime (Money Laundering) and Terrorist Financing Act, S.C. 2000, c. 17 (“PCMLTFA“) to legislate over Bitcoin as a matter of anti-money laundering law.”
5) New open-source router firmware opens your Wi-Fi network to strangers
I don’t get the purpose of this and, while it is possibly a good idea, I can see some problems with it. After all bandwidth is finite, and sharing it means you get less and your data cap gets eaten up by strangers. Of course, the main reason bandwidth is finite is because of ham-handed and generalized incompetent regulation but that is another issue.
“Members of the “Open Wireless Movement,” including the Electronic Frontier Foundation (EFF), Free Press, Mozilla, and Fight for the Future are advocating that we open up our Wi-Fi private networks (or at least a small slice of our available bandwidth) to strangers. They claim that such a random act of kindness can actually make us safer online while simultaneously facilitating a better allocation of finite broadband resources.”
6) Infographic: Avoid disaster with BYOD survival cheat sheet
I hate infographics, but this one raises a few good points like the fact that employees can exploit data plans on the company’s dime. For example, I might go to Florida and watch a soccer match on my smartphone resulting in a spectacular data charge and there is no way the company can sort out whether this was personal or business use. The links at the bottom of the page provide additional useful information.
“Unless you’ve been working under a rock in a faraway universe, your company is probably dealing with BYOD (bring your own device) challenges. Companies know they can’t just ignore BYOD. It’s common knowledge that employees will figure out how to get access to corporate information with or without explicit permission. But there’s an upside. Many employees willingly add hours to their work days when you permit them to use their personal devices on the job. You can benefit from the increased productivity and avoid BYOD security pitfalls if you follow a few best practices.”
7) Researchers Find and Decode the Spy Tools Governments Use to Hijack Phones
A couple of takeaways from the article should be that if the “good guys” know how to do this, then any other hacker, scam artist, etc., should be able to do so. The idea that these “products” are only sold to legitimate governments is absurd: the definition of what constitutes a legitimate use would be fluid and they would have no control of what happens after they sell the product. Thanks to my friend Allan Brown for this item.
“Newly uncovered components of a digital surveillance tool used by more than 60 governments worldwide provide a rare glimpse at the extensive ways law enforcement and intelligence agencies use the tool to surreptitiously record and steal data from mobile phones. The modules, made by the Italian company Hacking Team, were uncovered by researchers working independently of each other at Kaspersky Lab in Russia and the Citizen Lab at the University of Toronto’s Munk School of Global Affairs in Canada, who say the findings provide great insight into the trade craft behind Hacking Team’s tools.”
8) Aereo loses to broadcasters in Supreme Court fight for its life
One problem with disruptive business models (think Aereo, AirBnB, Uber, etc.) is that you run into an existing regulatory structure which generally favors the incumbents. Investors in Aereo might have thought they discounted the event risk associated with a loss at the Supreme Court, but this defeat appears to be total. It is unlikely the company can adjust its rate up high enough to pay licensing fees ot broadcasters, and the broadcasters – flush with victory – are not likely to be in much of a hurry to negotiate. For Aereo, the war is over.
“The Supreme Court struck a dramatic blow against Aereo today in a ruling that puts the TV streaming service as it currently exists on its deathbed. In a 6–3 ruling, the court found that Aereo’s service violates the Copyright Act by playing back recordings of broadcasters’ TV shows — even though it legally captures those shows over the air and obtains individual copies for each viewer. Aereo had argued that it was merely providing technology that its subscribers were renting in order to watch TV, positing that the viewers were responsible for playing back those recordings.”
9) Brain implant restores control of paralyzed muscles
More positive news in the bionics department, but the video makes it fairly obvious this is a long way from prime time. However, given 5 or 10 years this might result in a considerable improved quality of life to quadriplegics. Also, see item 19.
“The quadriplegia that comes as a result of a serious spinal cord injury cuts off the lines of communication between a person’s brain and their limbs. The condition is often irreparable, and those who suffer it do so for the rest of their lives, but surgeons at Ohio State University and researchers at Battelle might have just struck back at the condition. Using a technology called Neurobridge, the pair have been able to offer Ian Burkhart, a 23-year-old who was paralyzed after a diving accident, the ability to move his hand with his own thoughts for the first time in four years.”
10) The vacuum tube strikes back: NASA’s tiny 460GHz vacuum transistor that could one day replace silicon FETs
Interesting technology, but it is a bit premature to get excited about it. There are more parameters to a transistor than switching speed and a particular type of transistor has to meet or exceed a number of those to be of practical use. I am quite skeptical about the claim this would be used for computing because at a certain point speed, size, and power are closely related barriers to use. It is also worth noting that solid state devices have been made from exotic semiconductors and which operate at over 700 GHz. No – those aren’t likely to revolutionize computing either. The most likely application for such devices are probably advanced RADAR systems.
“Way back in the salad days of digital computing (the 1940s and ’50s), computers were made of vacuum tubes — big, hot, clunky devices that, when you got right down to it, were essentially glorified light bulbs. This is why early computers like the ENIAC weighed more than 27 tons and consumed more power than a small town. Later, obviously, vacuum tubes would be replaced by probably the greatest invention of all time — the solid-state transistor — which would allow for the creation of smaller, faster, cheaper, and more reliable computers. Fast forward to 2014, though, and the humble CMOS field-effect transistor (FET) is starting to show its age. We’ve pretty much hit the limit on shrinking silicon transistors any further, and they can’t operate at speeds much faster than a few gigahertz. Which is why NASA’s Ames Research Center is going back to the future with its new vacuum transistor – a nanometer-scale vacuum tube that, in early testing, has reached speeds of up to 460GHz.”
11) US Legal Lessons from Canada’s First STL IP Infringement Case
This was a Canadian case which was settled out of court so it is hard to believe many legal lessons could be learned therefrom. Furthermore, the issue seemed to revolve around a company selling a tangible implementation of an open source design which makes it hard to believe the designer would have prevailed, so the settlement was probably a positioning exercise my the defendant as much as anything else. That being said, does provide an interesting discussion regarding the Intellectual Property issues in play.
“Last month, 3Dprintler.com ran a blog post about “Canada’s First STL IP Infringement Case.” I can’t say if it was the first STL infringement case in Canada, or even if there was any infringement under Canadian law. However, this case provides a good opportunity to examine some of the principles related to digital files, 3D printing, and intellectual property from a U.S. legal perspective. At Public Knowledge I’ve been writing about these topics for years.”
12) Google: 100,000 lives a year lost through fear of data-mining
Golly: if a billionaire says it, it must be true! I mean you wouldn’t expect a Google founder to just make something like this up, especially since they can make money off it, would you? Given a record of collusion with the NSA (and, likely, others) what could possibly go wrong with letting corporations data mine health records?
“For me, I’m so excited about the possibilities to improve things for people, my worry would be the opposite,” he told the New York Times’s Farhad Manjoo. “We get so worried about these things that we don’t get the benefits … Right now we don’t data-mine healthcare data. If we did we’d probably save 100,000 lives next year.””
13) Even venture-backed Bitcoin miner startup can’t deliver on time, gets sued
These Bitcoin miner businesses are amusing. I figure they are inherently dubious. After all, if you had a gizmo which could churn out gold would you sell the gizmo for gold or churn out gold? The very fact somebody offers a gizmo or service which produces a fungible commodity and they are willing to sell you said gizmo or service implies they believe the money you are going to give them is inherently worth more than the commodity said gizmo or service will ever produce.
“Yet another Bitcoin miner manufacturer, CoinTerra, now faces legal action for not fulfilling an order when it originally promised to. CoinTerra is the third Bitcoin-related startup to face litigation for breach of contract and/or fraud in recent months.”
14) Google’s Android One program will set minimum standards for bargain-basement smartphones
I continue to believe smartphone prices are headed way down. These devices are targeting the developing world and it is important to understand these are unsubsidized, “all in”, type figures. Smartphone features are no longer really evolving so it is hard to believe that $100 pricing in the developing world will not have an impact on broader markets.
“Since the company is targeting the developing world, Google is initially teaming up with Indian smartphone makers like Karbonn and Spice. In an example presented on stage, Sundar Pichai talked about a Micromax Android One device with dual-SIM and SD card slots, a 4.5-inch display and FM radio priced at just $100.”
15) Warning over USB chargers after woman dies from apparent electrocution
This is what happens when you allow power mains connected things to be sold without the proper regulatory approvals. The only way to dissuade such practices is to levy extreme (i.e. bankrupting) fines or prison terms to the importing businesses. At least this will provide an incentive to Chinese vendors to forge the certification marks. Of course, if the prices in the photo are correct (A$25 for a ‘cheap’ charger) there would be a strong incentive to import stuff from China, regardless of quality: I can buy a cheap certified charger for $5 in Canada.
“Sheryl Aldeguer left behind two young children and a husband when she was electrocuted by a faulty USB phone charger in her rented room in Gosford in April. The 28-year-old, from the Philippines, was to start work as a theatre nurse at Gosford Hospital within days of her death. Authorities used Ms Aldeguer’s death to warn consumers against buying rip-off USB-style chargers. The young woman was wearing headphones and holding her laptop when she was found dead with burns on her ears and chest, in an apparent electrocution.”
16) Microsoft Makes Bet Quantum Computing Is Next Breakthrough
It seems Microsoft is backing a novel form of quantum computing, which makes this article interesting. The problem with quantum computing is that, like many novel computing systems, it has comparative limited utility. However, protein folding and other chemistry are among the applications a functioning quantum computer so a functioning system may lead to practical breakthroughs.
“Modern computers are not unlike the looms of the industrial revolution: They follow programmed instructions to weave intricate patterns. With a loom, you see the result in a cloth or carpet. With a computer, you see it on an electronic display. Now a group of physicists and computer scientists funded by Microsoft is trying to take the analogy of interwoven threads to what some believe will be the next great leap in computing, so-called quantum computing.”
17) iPhone or Android: it’s time to choose your religion
This sort of ties into item 20 as Google and Apple are diligently trying to tie users into their respective platforms. This move is in contrast with, say, the Consumer Electronics market which learned long ago that open standards work best. Some CE vendors, notably Sony, have tried to introduce proprietary systems but that has not, in general, worked well. I can imagine some people wanting, for example the same platform for their tablet and smartphone, but it is hard to believe I’d buy a car based upon what smartphone platform it works best with. Even less likely is that an auto vendor would hitch its wagon to Apple or Google.
“Life will surely be sweeter once every gadget you own relates intelligently to every other, but to get there, you’ll have to decide where your loyalties lie. And the fact that both Android and iOS platforms are set for their biggest updates in years this fall means that the obsessive comparisons between them will be as salient as they’ve ever been. More than ever, your smartphone preference will dictate your choice of tablet, TV, car, watch, and even fitness tracker.”
18) San Francisco Tells Parking Startup to Stop Operations, Warns Two Others
You might think that city lawyers would have bigger fish to fry than going after the dangerous criminals telling people where parking is available or the fiends who use that information to park their cars. Not that I think the startups have a chance in hell of being successful – it is a matter of time before the parking systems themselves tell you where spots are available (some already do).
“San Francisco City Attorney Dennis Herrera this morning sent a letter to MonkeyParking, a Rome-based startup that operates in San Francisco. The company’s app allows people to post information about the spot they are about to leave. Other drivers can pay for that information. The company currently operates in Rome and San Francisco.”
19) FDA clears ReWalk exoskeleton that lets paraplegics walk again
These sorts of systems could be a boon for paraplegics, however, I don’t understand why the FDA should have a say on whether they should be sold or not. How is this any different from crutches or a wheelchair in terms of approvals. Regardless, I expect to see continued progress in this domain, though ultimately spinal repair is the way to go. Pity about the sloppy journalism: “countless paraplegics” helped by the system? There can’t be that many of them.
“The ReWalk exoskeleton has helped countless paraplegics be able to walk again. But, until now, not just anybody in the US could buy one. That’s because the US Food and Drug Administration hadn’t given full approval for its use. However, the government announced Thursday that ReWalk has finally won FDA clearance.”
20) Apple isn’t letting Google control your home without a fight
“With all eyes on the iPhone 6, it can be difficult to remember that Apple has other hardware aspirations in the pipeline. 9to5Mac reports that Apple’s next priority will be the Smart Home, consisting of a range of new devices that will interact with Apple’s phones, computers and tablets. According to unnamed sources, Apple has put together a team specifically for the Smart Home initiative, and although development could be delayed, the company is “beyond the exploratory phase of development.””