The Geek’s Reading List – Week of December 19th 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This week’s tech news was dominated by the Sony hack and the fact Apple had withdrawn from the Russian market due to the weakness of the ruble. The Sony hack is less about technology than it is about inept corporate practices, which, given Sony’s recent history, should scarcely be a surprise. I saw countless articles regarding Apple’s decision to suspend sales in Russia, most of which suggested this was, somehow important. One cannot help but wonder whether the average Russian is going to be more concerned with buying food this winter than upgrading to an iPhone 6.
This edition of the Geeks List, and all back issues, can be found at www.thegeeksreadinglist.com.
1) Spanish Newspaper Publishers’ Association Now Asks Government To Help Stop Google News Closure
Sometimes you have to be careful what you wish for. The back story to this was that Spanish newspapers figured that Google was stealing their intellectual property by linking to their news sites via Google News. Inflated by moral outrage, they lobbied for, and got, a law compelling payment. Google, which claims to make no revenue from the service, decided that paying to provide traffic to Spanish newspapers didn’t make much sense, so they shut down the site. Not surprisingly, traffic to the Spanish newspapers promptly dropped, resulting in the Spanish newspapers losing ad revenue. You could not make this up.
“The main media lobby behind Spain’s new intellectual property law, which caused Google to announce late on Wednesday night that it was to close Google News in Spain, has now said it wants the Spanish government and European competition authorities to intervene to stop Google shutting down the service. The Spanish Newspaper Publishers’ Association (AEDE) issued a statement last night saying that Google News was “not just the closure of another service given its dominant market position”, recognizing that Google’s decision: “will undoubtedly have a negative impact on citizens and Spanish businesses”.”
2) Special Report: How Sony Systems Were Hacked
When hackers are portrayed in the movies, it is often as quirky geniuses with serious personality defects. Few hackers are that bright and they don’t have to be as most hacks start with pretty basic steps and exploit well known security holes. For example, when Sony illegally distributed a rootkit (http://en.wikipedia.org/wiki/Sony_BMG_copy_protection_rootkit_scandal), itself an example of corporate activity which would have led to prison time if a person had committed the act, it did not require the best and the brightest to do so. After all, they hacked Microsoft Windows. So it is not exactly surprising that the “geniuses” who hacked Sony used the old “steal the admin password” route. Why do I believe the admin’s password was “Password123”? You can rest assured numerous large litigation settlements will arise from this hack but the damage to Sony’s film business is probably terminal (see item 5).
“In late breaking news on Thursday, an unnamed U.S. government official told CNN that investigators have solved the vexing question of how the computer network Relevant Products/Services at Sony Pictures Entertainment was hacked. Rather than a sophisticated system breach or an inside job, as hypothesized by many in the I.T. security Relevant Products/Services establishment, the answer was actually quite simple. The hackers apparently gained access to Sony’s systems by obtaining the login credentials of a high-level systems administrator in Sony’s I.T. department. Once the credentials were in the hands of the hackers, they were granted “keys to the entire building,” as stated by the U.S. official, who was reportedly privy to government briefings on the topic of the Sony hack.”
3) BlackBerry woos keyboard loyalists with launch of Classic
This announcement was made a few days before Blackberry announced “disappointing” financial results. I put quotes around disappointing because the expectations regarding the company’s operating performance do not appear to be founded by any sort of research or analysis, but probably winks and nods from the company itself. In any event, the fact the company would launch such a product shows hows deeply troubled it is (as if all recent announcements had not already established that). All the Classic does is provide an alternative for the rapidly shrinking number of Blackberry users who would even consider purchasing another device from the manufacturer, it would never convince a new adopter to move to the platform. I can buy a dual SIM UNLOCKED Android phone for C$149 at the local computer store, or pay a bit more for a similar unit at Staples. Why on earth would I buy a Blackberry?
“BlackBerry Ltd launched its long-awaited Classic on Wednesday, a smartphone it hopes will help it win back market share and woo those still using older versions of its physical keyboard devices. The Canadian mobile technology company said the new device, which bears striking similarities to its once wildly popular Bold and Curve handsets, boasts a larger screen, longer battery life, an expanded app library with access to offerings from Amazon.com Inc’s Android App store, and a browser three times faster than the one on its legacy devices.”
4) Tesla’s game-changing, lane-changing Autopilot? “Currently, there is no radar on the market that can achieve that,” Toyota engineer says
It’s almost become a tradition to carry an item on Tesla in the Geeks Reading List, just like it was for Bitcoin for a couple years. I suspect Tesla will be a longer duration story simply because of the massive amounts of capital, and obliviousness (the two are related) injected by Wall Street. Furthermore, it will take a number of years before owners realize the batteries – which are the most expensive component of the vehicle – don’t last wrong and, due to the replacement cost, 5 to 8 year old Teslas should have a zero resale value. Thanks to Alain Bélanger of Novacap for this item.
“Two months ago, Tesla launched its Model D. Not quite a new car, not even a refresh, but the webs went wild. The Model D sports an extra electric motor, and a sensor package. Any other automaker, and such non-news would not even elicit a yawn from the press, save for a few snarky blogs that would torture the maker for not delivering the software for the hardware. Come to think of it, no automaker would dare to deliver hardware sans software, for fear of getting their derrieres handed to them. Tesla is unlike any automaker. As a Silicon Valley company, Tesla has marketing rights to vapor ware. The Model D was feted like the second coming of the Model T, and it was pronounced as equally, if not more disruptive to the industry than the mass-produced Ford.”
5) Sony Attack Is Unraveling Relationships in Hollywood
Following on from Item 2, it is hard to feel too much pity for a company whose executives are, apparently, disdainful of the “talent” they so vigorously court and promote externally, or one which, allegedly, tolerates a culture of racist jokes, etc., which would not be permitted even at an investment bank (largely because they understand what happens when such things get leaked). Most significantly it seems likely that no actor, director, or producer will be willing to work with Sony on any film which is in any way controversial given their singular lack of backbone. Recall that Chaplin released “The Great Dictator” in 1940 (while the US still enjoyed peaceful relations with Germany) and that was an obvious attack on Adolf Hitler.
“The attack has disrupted the web of executive, business and talent relationships that stitches together Sony’s core moviemaking operation. Hollywood’s creative community fumed about what they saw as failure by Sony to make a stand for artistic freedom. Steve Carell called it “a sad day for creative expression,” while Zach Braff described Sony’s move as “a pretty horrible precedent to set.” The filmmaker Judd Apatow and the documentarian Michael Moore also took to social media to lament the demise of “The Interview” as caving to the hackers.”
6) Ford dumps Windows for QNX in new in-car entertainment unit
At the time it was surprising Ford adopted Windows for its entertainment system, but it is not really that less strange they went for QNX. After all, an entertainment system is not exactly rocket science and Linux – or Android – is free. Besides, the industry is steadily moving towards automotive grade Linux in many other applications so it will be just a matter of time before Ford does the same.
“As foreshadowed in February, Ford has announced a new in-car entertainment and communications system that will run on BlackBerry’s QNX real-time operating system, not Windows as is the case for the company’s current efforts. Ford Sync 3 will offer touch-screen and voice recognition controls. The latter will allow drivers to command both their vehicle and apps on their phone. Siri control is another feature. The auto-maker’s offered a touch-screen system for some time now, but it’s widely regarded as one of its weak points. A complete refresh on a new operating system therefore looks like a good move.”
7) Google to Integrate Android Directly Into Cars (Report)
I am not convinced this particular strategy will work. Google may certainly want to tie auto vendors to its data gathering but I rather doubt they will comply (I suspect mass adoption of Apple’s alternative is even less likely, given that company’s history of slipping the blade into the back of its partners when convenient). Nevertheless, Android is an open source project and there is very little to prevent the auto or consumer electronics industries from adapting it to their needs while severing the Google proprietary link. You may then decide whether or not to pair your smartphone with your infotainment device, but since your smartphone is already providing Google and/or Apple with vast amounts of personal information, it is just a difference of semantics.
“Google knows that the next big platform war is going to take place behind the wheel, and it won’t necessarily need Android phones as a Trojan horse. A new report says the company has plans to integrate its operating system directly into vehicles in 2015. According to Reuters, Google wants Android to become the primary OS for your car’s infotainment system, which would allow drivers to get instant access to various services via a built-in Internet connection. The report also claims that Google would be able to make more use of a car’s camera, sensors, fuel gauge and more.”
8) Forget Hydrogen Cars, and Buy a Hybrid
The purpose behind the introduction of fuel cell is not to help the environment but rather to conform to California’s Zero Emission Vehicle standards as well as similar purportedly environmentally friendly measures in other jurisdictions. Such measures tend to be very popular, although one has to question how popular they will remain is, as seems to be the case, oil returns to its trend line price range of $20 to $40/bbl. As we have written extensively the problem with fuel cell cars is not the fuel cells but the hydrogen. It is a bit challenging to articulate in a few sentences, however, hydrogen is extremely expensive to transport, and peak production efficiency only occurs in massive plants. So you can expensively produce hydrogen locally or produce it in a large plant and expensively transport it. At least unlike Tesla batteries, a fuel cell car should have a resale value in the future, assuming of course they still sell them and support the infrastructure.
“If you want to help cut greenhouse gas emissions, you should probably skip the hydrogen fuel cell cars now coming to market and buy a (much cheaper) hybrid instead.”
9) Knees: Meniscus regenerated with 3-D-printed implant
The meniscus is the bearing surface in joints, in particular in this case the knee joint. When that bearing surface goes you end up with bone on bone friction, leading to rapid deterioration of the joint. Although meniscus transplants are done, as I understand it the tissue is harvested from cadavers and therefore like a joint replacement the fit is bound to be imperfect. This technique shows great promise as it means they would be able to create a custom fitting meniscus in fairly short order. This could significantly improve quality of life and result in a reduction of joint transplants. I suspect it could also be applied to other joints in the body.
“Columbia University Medical Center researchers have devised a way to replace the knee’s protective lining, called the meniscus, using a personalized 3D-printed implant, or scaffold, infused with human growth factors that prompt the body to regenerate the lining on its own. The therapy, successfully tested in sheep, could provide the first effective and long-lasting repair of damaged menisci, which occur in millions of Americans each year and can lead to debilitating arthritis. The paper was published today in the online edition of Science Translational Medicine.”
10) Amputee Makes History with APL’s Modular Prosthetic Limb
Obviously this is early stages – both in the treatment of this patient and the technology in general, but this is a pretty impressive step forward. In fact, the rather awesome video looks like something out of Terminator. I would be interested in knowing the cost as well as the duration of the battery pack.
“A Colorado man made history at the Johns Hopkins University Applied Physics Laboratory (APL) this summer when he became the first bilateral shoulder-level amputee to wear and simultaneously control two of the Laboratory’s Modular Prosthetic Limbs. Most importantly, Les Baugh, who lost both arms in an electrical accident 40 years ago, was able to operate the system by simply thinking about moving his limbs, performing a variety of tasks during a short training period.”
11) Researchers Make BitTorrent Anonymous and Impossible to Shut Down
I have been following Tribler for some time. It is a BitTorrent client which previously incorporated a search engine. Now it includes an anonymizer and a distributed file store, making it supposedly secure and impossible to shut down. Like the BitTorrent Browser, such a system can be used for good or evil, however, condemning the technology because of misuse is misplaced in my opinion. I have downloaded the software, however, I am not sure if it is working correctly. It may be that it functions like any other peer to peer system, namely the more users the more powerful it becomes.
“A team of researchers at Delft University of Technology has found a way to address this problem. With Tribler they’ve developed a robust BitTorrent client that doesn’t rely on central servers. Instead, it’s designed to keep BitTorrent alive, even when all torrent search engines, indexes and trackers are pulled offline. “Tribler makes BitTorrent anonymous and impossible to shut down,” Tribler’s lead researcher Dr. Pouwelse tells TF. “Recent events show that governments do not hesitate to block Twitter, raid websites, confiscate servers and steal domain names. The Tribler team has been working for 10 years to prepare for the age of server-less solutions and aggressive suppressors.””
12) Crossbar says it’s ‘one step’ from delivering miracle RRAM
I thought this article was interesting as it outlines some of the technologies which hope to displace Flash memory. I know a lot more about memristors (HP’s contribution) and I have a suspicion that technology will win out. After all, very few novel memory technologies ever make it to market. Nonetheless, I am rather doubtful Flash will be around in 20 years. One interesting point, however: it may be important for a start up company to ensure its technology works with existing semiconductor manufacturing techniques but it is muck less important for a large established company which can afford to invest in large, new plants full of novel technologies.
“Crossbar has jumped a hurdle limiting the readability if its resistive RAM non-volatile memory tech and says commercialisation is getting closer. Crossbar’s resistive RAM (RRAM) tech is a 3D semi-conductor structure promising higher densities and faster access than NAND; closer to the fabled uniform memory that’s as fast as DRAM and as non-volatile as flash. Resistive RAM s one of a number of technologies, including Phase-Change Memory and HP’s Memristor concept that are jostling to take-over from NAND – which is hitting a scaling wall preventing it from getting denser or faster, shortening its endurance and weakening its reliability. This RRAM tech was unveiled when Crossbar came out of stealth in August last year and has had a read problem to deal with; so-called sneak path currents affected the readability of data from cells in the RRAM structure.”
13) Skype Translator is the most futuristic thing I’ve ever used
I have used Google translate to communicate with Italian government agencies, though I suspect the English version I sent along was probably what they read. Nevertheless, automated translation software is pretty impressive stuff. I tend to be skeptical of spoken word translation since I can’t get my smartphone to understand a complete sentence in English without correction. In either event, this sounds pretty cool and potentially useful in a pinch. After all, people with rudimentary understanding of other languages can engage in conversation with enough repetition and correction.
“I don’t speak a word of Spanish—I took German at school instead—but with Skype Translator I was able to have a spoken conversation with a Spanish speaker as if I were in an episode of Star Trek (as long as that episode isn’t Darmok, amirite?). I spoke English. A moment later, an English language transcription would appear, along with a Spanish translation. Then a Spanish voice would read that translation. It took a moment to get used to the pacing of the conversation—the brief delay for the translation means that if you understand the language of the other person, there’s a temptation to respond immediately, without waiting for the voice to read the translation—but once this rhythm was learned, the conversation was fluent and continuous.”
14) Riding in Audi’s 150MPH self-driving RS 7, the anti-Google car
It is probably a pretty exciting – and disturbing – experience to sit in an autonomous car while it zips around a racetrack. However, it is worth noting that racetracks are probably a lot easier to navigate autonomously than any city street. I tend to believe it will be around 20 years before autonomous vehicles are plying the roads, although there will likely be a sort of sliding scale of autonomy as we get there. To reiterate, I firmly believe autonomous vehicles will lead to a sort of industrial revolution and restructuring of economies. Just not yet.
“Until last week, the sum of my autonomous driving experience was sitting behind the wheel while a car parked itself, and the sum of my track experience involved squeezing my lanky frame into a comically small go-kart. Audi changed that recently, giving me the opportunity to sit in its self-driving RS 7 Concept while it traversed the Ascari racetrack in southern Spain. It’s the same car that recently broke the autonomous speed record in Germany, hitting 240KPH (149MPH) at the Hockenheimring. Rather than aiming to improve on its record, Audi is at Ascari to test its “piloted driving” system against the circuit’s more-challenging corners. It’s also there to see how people react to being driven, at speed, around the track.”
15) The Rise of a New Smartphone Giant: China’s Xiaomi
The article notes that Xioami hopes to penetrate a number of emerging markets due to its lack of a patent portfolio. Given the business model, this makes sense: patents are largely used by large companies to suppress competition even those most such patents are rubbish. Emerging markets tend to be less friendly to such tactics. One might conclude that sales in emerging markets will have no impact to large companies such as Apple and Samsung, but that is not the case as the sale of significantly less expensive, but equivalently functional, smartphones into those markets will greatly reduce sales. As noted in item 3) I can buy a dual SIM unlocked Android phone for C$149 at the local computer store, or pay a bit more for a similar unit at Staples.
“In China, the smartphone battle used to be Samsung versus Apple. But not anymore. Over the summer, a Chinese company, Xiaomi, took the No. 1 position in China’s competitive market and became the world’s third-largest phone maker in the process. Founded in 2010 as a lean start-up to sell smartly designed phones at cheap prices over the Internet, Xiaomi was decidedly late to the game. Its first handset came out around the time of the iPhone 4S. But a clever social media strategy and a business plan that emphasized selling services that work on the phone helped Xiaomi build frenzied support from young and trendy Chinese. With people in China expected to buy 500 million smartphones in 2015 — more than three times as many as will be sold in the United States, according to the research firm IDC — Xiaomi is poised to cement its place as one of the most powerful phone makers in the world’s most important market.”
16) Material Question: Graphene may be the most remarkable substance ever discovered. But what’s it for?
This article is a modest effort to de-hype graphene and it was certainly due. After all, scarcely a day goes by where we don’t read of a battery, solar, semiconductor, or whatever, breakthrough associated with graphene. What tends to get lost in the discussion is the fact these results are typically theoretical or involve microscopic amounts of this staggeringly expensive material. In other words, none of them represent a practical breakthrough of any sort. The real problem is the production of graphene, not what it can do. Even if there is a breakthrough, consider the following. I calculate that graphene weighs about 7.2 mg per square meter, meaning a single gram of graphene requires the production of 138 square meters of the stuff. Think of it as paper and consider that “wonder batteries”, etc., will require many several grams of the stuff per watt hour of capacity. So, even if it the raw materials were free, the production of, say the roughly 41 million square meters of graphene which would be required to produce a small 30 kilowatt hour electric vehicle battery, would be quite an undertaking.
“Geim placed a piece of the tape under the microscope and discovered that the graphite layers were thinner than any others he’d seen. By folding the tape, pressing the residue together and pulling it apart, he was able to peel the flakes down to still thinner layers. Geim had isolated the first two-dimensional material ever discovered: an atom-thick layer of carbon, which appeared, under an atomic microscope, as a flat lattice of hexagons linked in a honeycomb pattern. Theoretical physicists had speculated about such a substance, calling it “graphene,” but had assumed that a single atomic layer could not be obtained at room temperature—that it would pull apart into microscopic balls. Instead, Geim saw, graphene remained in a single plane, developing ripples as the material stabilized.”
17) Amazon’s cloud business a harder sell in post-Snowden era
A couple things of note: the Taser story is a red herring since, under the US Patriot Act, all US companies are required to hand data over to US law enforcement upon request, regardless of where that data happens to be stored. Furthermore, while there are certain business models which lend themselves to cloud hosting, storage of proprietary information, accounting, legal, etc., are decidedly not among them as a cloud represents a single point of failure for both operations and security. You also become “bound” to the SaaS (Software as a Service) provider which is what delights Wall Street so much. Private clouds are easy enough to set up, relatively cheap, and you are far more likely to be secure against any type of attack than if you rely on Amazon, Google, Microsoft, or any other large company.
“This spring, Taser International Inc won a small but high-profile contract to supply body cameras to the London police. But the deal nearly collapsed over one issue: where the video footage would be stored. In the end, the deal survived only after Taser dropped Amazon.com Inc as the data storage provider for the year-long project. The fact that Amazon did not have a data center in Britain was a deal breaker for British officials, according to Taser.”
18) NASA Rover Finds Active and Ancient Organic Chemistry on Mars
This press release out of NASA led to a lot of speculation as to whether Curiosity had discovered evidence of life on Mars. While that may, indeed, be the case, organic chemistry does not mean chemistry from organisms. There are, after all, lots of ways you can make methane without wee beasties making it. Nevertheless, life is a potential explanation.
“NASA’s Mars Curiosity rover has measured a tenfold spike in methane, an organic chemical, in the atmosphere around it and detected other organic molecules in a rock-powder sample collected by the robotic laboratory’s drill. “This temporary increase in methane — sharply up and then back down — tells us there must be some relatively localized source,” said Sushil Atreya of the University of Michigan, Ann Arbor, a member of the Curiosity rover science team. “There are many possible sources, biological or non-biological, such as interaction of water and rock.””
19) New law for superconductors
This sounds like an important theoretical result. Unfortunately, progress in actual applications for superconductors has been painfully slow.
“MIT researchers have discovered a new mathematical relationship — between material thickness, temperature, and electrical resistance — that appears to hold in all superconductors. They describe their findings in the latest issue of Physical Review B. The result could shed light on the nature of superconductivity and could also lead to better-engineered superconducting circuits for applications like quantum computing and ultralow-power computing. “We were able to use this knowledge to make larger-area devices, which were not really possible to do previously, and the yield of the devices increased significantly,” says Yachin Ivry, a postdoc in MIT’s Research Laboratory of Electronics, and the first author on the paper.”
20) The Darwin Awards: sex differences in idiotic behaviour
This is a rather entertaining read, though I am not entirely sure whether it is parody or science. The conclusions are not surprising: besides the fact that men tend to take on more hazardous work (whether due to economic need or a disregard for risk) I suspect the last words of far more males than females have been “hey watch this”.
“Sex differences in risk seeking behaviour, emergency hospital admissions, and mortality are well documented. However, little is known about sex differences in idiotic risk taking behaviour. This paper reviews the data on winners of the Darwin Award over a 20 year period (1995-2014). Winners of the Darwin Award must eliminate themselves from the gene pool in such an idiotic manner that their action ensures one less idiot will survive. This paper reports a marked sex difference in Darwin Award winners: males are significantly more likely to receive the award than females (P<0.0001). We discuss some of the reasons for this difference.”