The Geek’s Reading List – Week of October 10th 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 has beenanother very slow tech news week. Most websites continue to dedicate resources to promoting things like Tesla, which, late in the week launched a vehicle with two (2!) electric motors. Perhaps this is to provide redundancy as “long term” tests show the drive systems on the Model S last about10,000 miles between replacement. Perhaps the most interesting story is that Adobe’s “Digital Editions 4” turns out to have all the attributes of malware. While the “EULA” probably cover this, expect a sizable lawsuit as a consequence. Be warned: this sort of thing is increasingly common.
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1) Adobe is Spying on Users, Collecting Data on Their eBook Libraries
Personally I avoid Adobe software like the plague: the ubiquitous PDFreader is a 73 MB file with incredibly frequent security updates while the more functional and stable Nitro PDF reader (http://www.nitropdf.com/pdf-reader) is about 1/20th the size. I’ve never used this Adobe software, but it seems that it is needed to loan ebooks from libraries so this particular malware attack appears to be directed to those most dangerous of people: “readers”. Large software companies are faced with a conundrum: they no longer innovate and their markets are saturated. Every now and they they get brilliant ideas such as this, which is probably motivated by the desire to aggregate and exploit big data. When you have had no growth for the past four years, pay no dividend, produce little in the way of cash flow, and yet have a $33B market value, you gotta do something.
“Adobe has just given us a graphic demonstration of how not to handle security and privacy issues. A hacker acquaintance of mine has tipped me to a huge security and privacy violation on the part of Adobe. That anonymous acquaintance was examining Adobe’s DRm for educational purposes when they noticed that Digital Editions 4, the newest version of Adobe’s Epub app, seemed to be sending an awful lot of data to Adobe’s servers. My source told me, and I can confirm, that Adobe is tracking users in the app and uploading the data to their servers. (Adobe was contacted in advance of publication, but declined to respond.)”
2) Adobe’s Half-Assed Response To Spying On All Your eBooks
As a follow up, Adobe did, finally, address its malware problem through misdirection and deceit, finally pointing out that, indeed, it ain’t malware if you agreed to it. I can imagine this software is firmly ensconced, so there is very little chance anybody can do anything about it (except, as noted above, through a class action suit). Perhaps some bright developer can create a background task which spoofs the Adobe malware, resulting in (for example) the contents of the Library of Congress to be inserted into their database.
3) The amazing progress of LEDs, in one chart
It is a little weird the guys who invented the blue LED got the Nobel since they built upon the work of the inventor of the LED, and he didn’t get anything. In any event, the blue LED enabled the white LED, and the white LED is having, and will continue to have a dramatic effect on the way the world is lit. Unlike compact florescent bulbs, which are fragile, relatively short lived, and often give off pretty awful light, White LEDs are the future of lighting – this time no laws will be needed to promote them. They are efficient, and getting ever more efficient, robust, and very long lived. Even the pricing has dropped steadily.
“This year’s Nobel Prize in physics was awarded to three scientists who advanced LED lighting technology in the 1990s. Their work was part of a longer-term trend of rapid improvements in LEDs. The improvements have come so fast, in fact, that engineers came up with a law to track the changes. Everyone knows about Moore’s law, which says that the number of transistors in a computer chip (and, therefore, its computing power) doubles every 18 to 24 months. It has a less famous cousin called Haitz’s law. It says that every 10 years, the power of LED lighting packages will increase by a factor of 20, while the cost of these packages, per unit of illumination, will fall by a factor of 10.”
4) Why Are We Letting Critical Infrastructure Get Regulated By A Cartoon Industry?
This article makes the very valid argument that, while economic growth in being driven by innovative connected technologies, legislation is being driven by much smaller, utterly non-innovated, entrenched businesses. The reason this is the case should be pretty clear: the entrenched businesses know how to work the system and “influence” the lawmakers who matter and most lawmakers in most countries are oblivious to technology. Frankly, discussions I’ve had indicate that, while they may or may not use technology, the demographic which comprise politicians simply cannot grasp the underlying structure or how it interrelates. Cartoons they understand.
“It stands clear that the net is by far the most critical piece of infrastructure existing today. Not only does it build all future jobs, growth, economy, and entrepreneurship; we also exercise all our civil liberties, civic duties, and spend a lot of our social activities on this infrastructure. It’s more important than any other piece of infrastructure in society. We can do without the phone network, without cable TV, even without paved roads when we have the net. So why are we letting this infrastructure get regulated by a cartoon industry?”
5) Apple Sapphire Supplier GT Advanced Technologies Files For Bankruptcy
I first heard of this company in the lead up to the launch of the iPhone 6, which was rumored to have a sapphire display. As a general rule, I never invest in small supplier to companies such as Apple because they end up locked in a deadly embrace: they have one very large customer and no pricing power. Eventually that customer moves on and the supplier goes bankrupt. Event risk is not something I like, especially when I cannot predict the event. To put things in perspective when rumors flew that GTAT would supply the display glass for the iPhone 6 the stock was around $20, for a market value of $2.2B. What is odd is that their reported financial statements, which may or may not reflect the actual position of the company do not appear to predict any sort of risk of bankruptcy.
“GT Advanced Technologies, which has a supply relationship with Apple after an agreement struck late last year, has filed for Chapter 11 bankruptcy protection. The company will continue to operate as normal despite the filing, which is designed to protect its assets and operating budget from debt while it restructures and re-finances its obligations.”
6) Send Your Name on NASA’s Mars Journey, Start with Orion
This is something which might interest space enthusiasts and kids. As near as I can figure, you submit your name and they include it on a chip to go in space. Since a 128GB flash device could probably contain the names of all the people on the planet, and since this would be a non-critical system, this is a clever, low-risk, low cost “feel good” move by NASA. It would be a get parcel to add to the next Voyager (deep space) type mission. Sign up!
“If only your name could collect frequent flyer miles. NASA is inviting the public to send their names on a microchip to destinations beyond low-Earth orbit, including Mars. Your name will begin its journey on a dime-sized microchip when the agency’s Orion spacecraft launches Dec. 4 on its first flight, designated Exploration Flight Test-1. After a 4.5-hour, two-orbit mission around Earth to test Orion’s systems, the spacecraft will travel back through the atmosphere at speeds approaching 20,000 mph and temperatures near 4,000 degrees Fahrenheit, before splashing down in the Pacific Ocean.”
7) Sharper Image From 4K TVs Is a Gimmick Worth Having
The use of 4K or 8K in production might have merit, at least for special events like sports, however, I remain confident the 4K TV will be as much of a yawner as 3D was from the consumer perspective. 4K TV prices are dropping quickly and will soon approach the level of standard HDTVs. One should be wary of the $1,000 4K TV because you are probably going to end up with a pretty crappy TV. In terms of worth having, well, in general, cutting edge TVs might have better image processing, etc., but unless the content is there (including a 4K cabling standard) you are still going to see the typical sub-HD transcoded picture as delivered by the cable company.
“Americans have made it clear: They don’t want a lot of gimmicks in their TVs. In an effort to improve sales, though, television makers have tried gimmicks anyway. They have praised 3-D TVs. They have promoted voice controls. And they have highlighted Internet-streaming interfaces. None have really moved the needle. The latest big selling point — ultrahigh-definition displays, also known as 4K — also faces an uphill climb. But unlike many of the gimmicks and features that have been tried in years past, 4K is one we will probably adopt. And with one name-brand 4K television available for $1,000, this could be the year that starts happening.”
8) UW fusion reactor concept could be cheaper than coal
This article got a fair bit of profile during the week, along with reports of successful cold fusion, proving my thesis that the very mention of the word energy causes most people’s IQ to drop 50 point. The problem with this story is pretty simple: the issue with fusion is not cost. This issue with fusion is that it doesn’t work and hasn’t even come close to working. So somebody can doodle all they want about “low cost fusion” but unless and until anybody actually designs a fusion reactor which is a net producer of power, pricing is moot. Of course that day will come: apparently there is a new cold fusion process …
“Fusion energy almost sounds too good to be true – zero greenhouse gas emissions, no long-lived radioactive waste, a nearly unlimited fuel supply. The UW’s current fusion experiment, HIT-SI3. It is about one-tenth the size of the power-producing dynomak concept. Perhaps the biggest roadblock to adopting fusion energy is that the economics haven’t penciled out. Fusion power designs aren’t cheap enough to outperform systems that use fossil fuels such as coal and natural gas. University of Washington engineers hope to change that. They have designed a concept for a fusion reactor that, when scaled up to the size of a large electrical power plant, would rival costs for a new coal-fired plant with similar electrical output.”
9) Shootout: How does a high-end smartphone camera compare to a $3,400 DSLR?
Every time Apple comes out with a new phone, somebody has to compare the over-hyped virtues of a camera with less than $20 in content (including an aspirin sized lens) with an actual, honest to god camera. Usually they choose an expensive camera, such as this one, and discover that, while the really expensive camera is better, the iPhone is pretty good. Realistically, what they should do is compare a cheap $200 real camera with the iPhone and have the comparison done by somebody who knows something about photography, depth of field, gamut, depth perception, etc., etc.. In which case the conclusion would be that ALL smartphone cameras are crap.
“This is a fair amount of scratch to lay down for a camera, especially when the Internet is full of examples of pro photographers going the opposite direction, ditching bags of expensive gear in favor of smartphone cameras for most applications. The idea here is that the person, not the gear, takes the picture. And there is a (likely apocryphal) story that tells the tale of an encounter between famous novelist Ernest Hemingway and famous photographer Ansel Adams. In the story, Hemingway is purported to have praised Adams’ photographs, saying, “You take the most amazing pictures. What kind of camera do you use?” Adams frowned and then replied, “You write the most amazing stories. What kind of typewriter do you use?””
10) Ultrasmall, Millimeter-Size Wireless Health Sensors Detect Pulse And Pressure
A number of years ago, Zarlink, a small Canadian semiconductor company was working with a number of vendors to develop low power wireless interfaces for this sort of application. Alas, like most Canadian tech companies Zarlink was acquired so it is hard to know what happened to the work. Regardless, this sensor technology is probably the other half of that application. Whether or not this specific approach will be commercially successful, this sort of technology is the future of medicine.
“Engineer scientists at Stanford have created a submillimeter sensor device that transmits biological health readings wirelessly. The device is very small, measuring in one realization at only 1 millimeter by 1 millimeter in length and width, and 0.1 millimeter in depth. It is also highly robust as it works well in tissue environments which are considered “lossy” as they attenuate electromagnetic signals. Finally the device has been shown capable of reading human pulse waveforms from arterial blood flow as well as intracranial pressure in a mouse. The novel invention, in guaranteeing continuous, real time readout of health signs, is a significant advance in the area of ultrasmall, wearable sensors. Such devices are 100 times smaller than equivalent commercially available products, and 10 times smaller than research devices of similar function.”
11) Captive orcas speak dolphin
Ah – orcas may speak dolphin, but what do they say? Seriously, my parrot speaks French, English, cat, dog, microwave, telephone, tablet, and parrot, and I actually understand what he is saying when he speaks human. I would wager that the very fact captive orcas sometimes speak dolphin means they probably mimic other animals calls in the wild. Like, for example, telling a seal there are tasty fish in the neighborhood (since orcas eat seals and pretty much anything else).
“Two years ago, scientists showed that dolphins imitate the sounds of whales. Now, it seems, whales have returned the favor. Researchers analyzed the vocal repertoires of 10 captive orcas (Orcinus orca), three of which lived with bottlenose dolphins (Tursiops truncatus) and the rest with their own kind. Of the 1551 vocalizations these seven latter orcas made, more than 95% were the typical pulsed calls of killer whales. In contrast, the three orcas that had only dolphins as pals busily whistled and emitted dolphinlike click trains and terminal buzzes, the scientists report in the October issue of The Journal of the Acoustical Society of America. The findings make orcas one of the few species of animals that, like humans, is capable of vocal learning—a talent considered a key underpinning of language.”
12) One in three jobs will be taken by software or robots by 2025
Gartner and other industry research folks have a great thing going: they charge astronomical sums for studies which I have found, even directionally, to be little better than chance. In fact, I argue that industry research has negative value because bad information rarely leads to good decisions. Regardless, according to Gartner, robots and drones are gonna take our jobs, indeed, one third of jobs, within the next 11 years. I don’t quite understand the time frame, let alone the impact: any factory of any size uses a huge number of robots and other automated machine for practically anything which can be automated. Thanks to my firennd Humphrey Brown for this item.
“Gartner sees things like robots and drones replacing a third of all workers by 2025, and whether you want to believe it or not, is entirely your business. This is Gartner being provocative, as it typically is, at the start of its major U.S. conference, the Symposium/ITxpo. Take drones, for instance. “One day, a drone may be your eyes and ears,” said Peter Sondergaard, Gartner’s research director. In five years, drones will be a standard part of operations in many industries, used in agriculture, geographical surveys and oil and gas pipeline inspections.”
13) Chip Options Sought as Costs Rise
Every now and then I encounter a small semiconductor company and, while I wish them luck, I feel rather sad. Setting aside the overwhelming power of ODMs such as Foxconn, which strip most semiconductor companies of even a semblance of pricing power, the costs of producing a cutting edge chip are now well beyond the ability of a small company to fund. In the incredibly unlikely event the small company happens upon a profitable market segment (and it tends to be multiple small companies addressing the same segment at the same time) the most likely outcome is that titans such as Samsung, Texas Instruments, etc., who are all desperate to keep their factories busy, simply move into the space. It never ends well.
“The low cost of capital is fueling M&A across all industries, and the rising cost and complexity of making chips is pouring gas on the fire in semiconductors. It could cost $53 million to make a 20 nm chip, up from $36 million for a 28 nm part, and cost will take another leap with the 16/14 nm node, Edelstone told the crowd. “It requires a really big market to make money on such an investment, and this will have a dramatic impact on how the industry evolves. The cost per gate is going up with the [16/14 nm] FinFET generation, which changes the dynamics of the industry pretty dynamically — that tells you scale matters.””
14) Optical Image Stabilization
This is the beginning of a somewhat larger product note put out by Rohm regarding its Optical Image Stabilization (OIS) product portfolio. Despite that, the beginning tells you a fair bit about how OIS works and what the advantages are compared to Electronic Image Stabilization (EIS), in case you’ve ever wondered. The deeper point is, systems have become so complex and so cheap that we can, cost effectively, wiggle lenses in two dimensions based on feedback from an equally tiny and cheap gyroscope. Amazing.
“Optical Image Stabilization or OIS is an important element in reproducing a digital replica into perfection. Without this, capturing still images and recording moving video will result in pixel blurring and the appearance of unwanted artifacts. While digital capturing devices like digital cameras, digital camcorders, mobile phones and tablets grew smaller, their need for resolution quality and pixel count density grew bigger exponentially over the last decade. The market shift to compact mobile devices with high megapixel capturing ability has created a demand for advanced stabilization techniques. Two methods, electronic image stabilization (EIS) and optical image stabilization (OIS), are the most common implementations.”
15) Amputees discern familiar sensations across prosthetic hand
I tend to think of prosthetics as a stop gap until limb regeneration is figured out (yes I am serious). Of course that might take a few decades, so in the meantime this branch of research can have a significant impact in the quality of life of those missing limbs. Touch is an important component of the feedback loop for any prosthetic, in particular the hand. This article suggests a bit of a breakthrough in terms of effect and duration.
“Even before he lost his right hand to an industrial accident 4 years ago, Igor Spetic had family open his medicine bottles. Cotton balls give him goose bumps. Now, blindfolded during an experiment, he feels his arm hairs rise when a researcher brushes the back of his prosthetic hand with a cotton ball. Spetic, of course, can’t feel the ball. But patterns of electric signals are sent by a computer into nerves in his arm and to his brain, which tells him different. “I knew immediately it was cotton,” he said.”
16) Teens are officially over Facebook
I tend to ascribe less reliability to equity research than industry research because I’ve met enough research analysts to develop a very low opinion of their abilities, let alone their integrity. Fortunately for them, a particular mental defect immunizes most from being able to differentiate between what they know and what they think they know. In any event, I know a lot of GRL readers are very interested in Facebook, which I am told is the leading social networking site. These folks at Piper Jaffray appear to have done a “study” which casts doubt on the level of interest among youth.
“In May 2013, they were fleeing Facebook’s “drama.” A year later, they flocked back to the network like lil’ lost sheep. Now, a pretty dramatic new report out from Piper Jaffray — an investment bank with a sizable research arm — rules that the kids are over Facebook once and for all, having fled Mark Zuckerberg’s parent-flooded shores for the more forgiving embraces of Twitter and Instagram. Between fall 2014 and spring 2014, when Piper Jaffray last conducted this survey, Facebook use among teenagers aged 13 to 19 plummeted from 72 percent to 45 percent. In other words, less than half of the teenagers surveyed said “yes” when asked if they use Facebook.”
17) New technique yields fast results in drug, biomedical testing
This is another medical technology development with some promise. Unfortunately, the article seems to stress the ability to “detect drugs” which I do not consider to be a priority. In fact, I predict that a cheap test which would allow parents to test their kids for illegal drug use would probably lead to more runaway kids than it would to lower drug abuse, but hey, you go where the market is. Perhaps a more focuses approach could permit this device to be used to search for disease markers, etc..
“A new technique makes it possible to quickly detect the presence of drugs or to monitor certain medical conditions using only a single drop of blood or urine, representing a potential tool for clinicians and law enforcement. The technique works by extracting minute quantities of target molecules contained in specimens of blood, urine or other biological fluids, and then testing the sample with a mass spectrometer.”
18) Volvos Will Soon Plot ‘Escape Routes’ to Avoid Wrecks
Gartner’s concerns to the contrary (see item 12) a major application for robotics over the coming years is likely to be autonomous vehicles. One challenge I see with stressing accident avoidance (in contrast with, for example, ‘autopilot’) is that it is hard to see the value proposition from the buyer’s perspective. Yes, there would be tremendous societal value associated with saving peoples’ lives, but that is what insurance is for (no, I am not being sarcastic – my son’s life would have been spared with such a system). Perhaps the route to rapid adoption would be through significant reductions in insurance premiums.
“The system, which is still at least five years from hitting showrooms, can detect potential accidents before they occur, even if they’re outside the driver’s line of sight. If an accident is imminent, the car can determine an “escape route” and auto-brake and even steer the car to avoid the accident. It’s the high-tech equivalent of Sylvester Stallone in that horrible movie Escape Plan: Always looking for a way out of trouble. The technology can identify different types of road users like pedestrians, cyclists, and vehicles—an important ability because they all act differently, at varied speeds, in different parts of the road. Scenarios are anticipated up to five seconds in advance, with alerts sent to the driver. If he doesn’t respond in time, the car takes action on its own.”
19) The cookie is dead. Here’s how Facebook, Google, and Apple are tracking you now
One thing about technology is that it keeps changing. Not that long ago the EU introduced laws requiring you give permission before a website installs a cookie on your system. Personally, I prefer a more direct approach and block them as much as possible from my end. The interesting thing is, as the cookie dies, business models associated with cookies follow it. Right now a small number of companies are taking up the slack and that is probably not a good thing.
20) NIST Laser Comb System Maps 3D Surfaces Remotely for Manufacturing, Forensics
This is a novel approach to laser scanning which appears to speed things up greatly. As noted in the article, 3D scans do not destroy evidence as, say, a plaster cast does. Nonetheless, it will be interesting to see whether such evidence is found to be admissible in court: after all, any digital file can be manipulated.
“Researchers at the National Institute of Standards and Technology (NIST) have demonstrated a laser-based imaging system that creates high-definition 3D maps of surfaces from as far away as 10.5 meters.* The method may be useful in diverse fields, including precision machining and assembly, as well as in forensics. NIST’s 3D mapping system combines a form of laser detection and ranging (LADAR), which is sensitive enough to detect weak reflected light, with the ranging accuracy made possible by frequency combs, as previously demonstrated at NIST.** The frequency comb, a tool for precisely measuring different frequencies of light, is used to continuously calibrate the laser in the imaging system.”