The Geek’s Reading List – Week of March 27th 2015
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 12 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) Intel: PC sales weak as many businesses stick with Windows XP
I predicted the end of PC sales growth about 8 years ago so stories of a week market are not exactly new. Except for gamers, for most people in most applications PCs are now replaced when they break, not because they lack the power to keep up with the demands of software. A similar argument can be made for operating systems, in particular Windows XP: for most people in most circumstances, it is more than up to their job. Of course, the major weakness in Windows XP is security, especially since Microsoft essentially announces security flaws to the world and doesn’t fix them for XP. Mind you, security is not a passive thing and company policies and practices can have an impact. It can be a lot cheaper than regularly replacing your machines and/or getting into a subscription agreement with Microsoft.
“Perhaps the most interesting detail that emerged from Intel’s lackluster first quarter financial results the other day had nothing to do with mobile, the company’s white whale. Instead, it concerned something so old that it almost seems laughable in the same week that the very 21st-century Apple Watch dominated headlines. Per ZDNet’s own Larry Dignan: “In a statement, Intel said it cut its first quarter outlook because of “weaker than expected demand for business desktop PCs and lower than expected inventory levels across the PC supply chain.” One reason the chip giant cited for that weaker demand: a slowdown in companies upgrading from Windows XP systems. What’s particularly interesting about this is that the move away from the ancient OS helped drive some of Intel’s better results in 2014.”
2) One reason to love Chromebooks even if you don’t want one
This is somewhat of a reprise of the Netbook period when PC vendors launched very low cost laptops in an effort to invigorate interest in PCs, though, at that time there was not much of a competitive alternative. Chromebooks, which are meant to be used mostly online are quite cheap and reasonably capable for basic applications. Given a choice I would go for a Windows machine at the same price because I liven in Canada where Internet access is slow, expensive, and unreliable. Of course, a lot depends on how competitive these new machines are, at least from a feature perspective.
“Apparently, Microsoft is keeping a close eye on these cheap Chrome OS computers, and wants to put up a fight with affordable Windows machines of its own. Digitimes has learned from sources familiar with the matter that Microsoft plans to release cheaper laptops to compete against affordable Chromebooks this year. The company is working on at least two distinct clamshell notebook models, the publication says, both featuring 11.6-inch displays. The devices should start selling at some point in mid-2015, with prices ranging from $149 to $179. The new affordable Windows devices will pack Intel’s Bay Trail-T CR processor, with one model geared towards education, which also happens to be a target for Google’s Chromebooks. Interestingly, the consumer model will cost $149, while the education version will be priced higher, at $179.”
3) Moore’s Curse
I’m glad somebody wrote this article and a link to it should be placed next to every article about self driving cars, solar power, and electric vehicles. Moore’s Law applies to transistors and transistors alone because they get better AND cheaper as they get smaller and the technology to make them smaller has followed a predictable path for about 50 years. In contrast, for example, bolts do not get better as they get smaller. Most other things get slightly better and slightly cheaper over time but the rate of change is limited by other factors. A battery is limited by chemistry and size: unless you make big changes to the chemistry (and chemistry progresses slowly) a battery is not going to improve that much that quickly. The same goes for solar cells and windmills. Physics rules.
“As components have gotten smaller, denser, faster, and cheaper, they have increased the power and cut the costs of many products and services, notably computers and digital cameras but also light-emitting diodes and photovoltaic cells. The result has been a revolution in electronics, lighting, and photovoltaics. But the revolution has been both a blessing and a curse, for it has had the unintended effect of raising expectations for technical progress. We are assured that rapid progress will soon bring self-driving electric cars, hypersonic airplanes, individually tailored cancer cures, and instant three-dimensional printing of hearts and kidneys. We are even told it will pave the world’s transition from fossil fuels to renewable energies.”
4) Micron and Intel Unveil New 3D NAND Flash Memory
A number of companies announced 3D NAND Flash memory recently. This allows multiple layers of storage on the same die, significantly reducing cost and packaging size. As the press release and video suggest, this approach is particularly suited to Solid State Drive (SSD) applications. As I predicted a few years ago, the era of the Hard Disk Drive (HDD) is drawing to a close and I recommend upgrading any laptop with an SSD if it doesn’t already have one. Ultimately, the HDD industry will more or less disappear and all of the value of that industry will be transferred to the Flash memory manufacturers.
“The new 3D NAND technology stacks flash cells vertically in 32 layers to achieve 256Gb multilevel cell (MLC) and 384Gb triple-level cell (TLC) die that fit within a standard package. These capacities can enable gum stick-sized SSDs with more than 3.5TB of storage and standard 2.5-inch SSDs with greater than 10TB. Because capacity is achieved by stacking cells vertically, the individual cell dimensions can be considerably larger. This is expected to increase both performance and endurance and make even the TLC designs well-suited for data center storage.”
5) The Critical Smartphone Issue That Manufacturers Ignore
This is not a very well written piece but it makes a good point: as manufacturers pursue style over substance battery life cannot keep up with demands. Of course, one could offer replaceable batteries, but that is an expensive option. Alternatively, just add a millimeter or two to the thickness of the case: my Nexus 5 has a 2300 mAhr battery and the battery is 6mm thick out of a total thickness of 9mm for the whole phone. Increasing the phone’s thickness by 3mm would add more than 50% to the battery capacity. Since I, like many other users, have a rubberized protector on the phone to protect the screen from cracking, a factory rubberized, slightly thicker, Nexus 5 would have 50% more battery and actually be thinner and lighter than what I carry around today.
“I’ve spent the last ten days in Austin attending the various strands of SXSW. I’ve been doing so for the last eleven years, and one thing that has become clear over the last few years, and acutely aware of this year, is just how ill-served consumers are over a critical part of smartphone design. Modern batteries are too small.”
6) Apple files patent for a SUPER camera: System uses mirrors and multiple sensors to make photos brighter and clearer
This technological breakthrough was covered with the usual fawning praise for anything Apple does or is rumored to be considering doing. The funny thing is, there is nothing novel about 3 CCD cameras – I’ve actually owned a couple of them. How it is possible to patent something which has been in mainstream consumer products for the past 15 years or so is a complete mystery.
“Apple’s latest marketing campaign has been designed to showcase just how good the cameras are on its iPhone 6 range. But if a patent awarded earlier this month is anything to go by, the camera on the iPhone 7 could take even better photos. The papers, originally filed in 2011, detail a three-sensor camera that splits light to boost the number of pixels it can manage.”
7) Apple Pay Adoption: Improving, But Still A Long Way To Go
This story was reported a number of different ways, depending on the biases of the source. Long story short, Apple Pay is only available on iPhone 6s and only a small fraction of those appear to to have any interest. There might be many reasons for this, including a limited number of stores supporting the system although why any store would support a proprietary pay system only useable by a small subset of a minority of mobile users is another matter. Apple is an effective marketer, so you should not count them out on Apple Pay. Nevertheless, I suspect any such payment system will have to be adopted across Android and iPhone to be successful, or, at least the respective readers at the stores should be able to handle either system equally well.
“A little under four months ago, the payments ecosystem got something of a surprise when a first round of Apple Pay adoption numbers was released by InfoScout in collaboration with PYMNTS.com. A survey of about 400 possible Apple Pay users on Black Friday revealed that 95 percent of iPhone 6 and 6+ users who could have paid with Apple Pay on Black Friday didn’t. Perhaps more surprising, five weeks after launch, more than 90 percent of those who could have used Apple Pay hadn’t given it a try. Four-and-a-half months have passed however. That has given Apple the chance to build, enhance and expand its payments ecosystem — signing on new banks, and forging merchant partnerships in its quest to broaden its appeal. Consumers have been inundated with Apple Pay promotions from their banks, and media coverage has been intense.”
8) A review of Android for Work: Dual-persona support comes to Android
I used to work for a bank which had very strict rules regarding what you could use your device for and it was understood the compliance department tracked all your emails, etc.. Of course, the IT department seemed to be about 5 years behind the times and as responsive as slugs when things went wrong so most of us carried two devices. I am pretty sure (but could never prove) the more “entrepreneurial” employees conducted “special” business on their personal devices, many of which were actually paid for by the bank. The mobile industry is catching up and beginning to offer “dual personality” devices which allow for concurrent operation as business and personal phones. This might also help with billing. Of course, as an early generation product, the article notes set up is bizarrely complicated, however, that will no doubt change.
“If you work in an office environment, you probably know a few people—maybe a lot of people—with two smartphones. One is a personal phone full of pictures of the family, games, social networking, and sports stuff, and the other is a company-issued smartphone full of e-mail, appointments, contacts, and documents. With two phones, your IT department has full control over your work data and can remotely wipe it, and they never get to see your personal pictures or other information. It’s a workable setup, but the downside is all the duplication—you have two phones, two chargers, and almost no free pocket space. The other alternative is BYOD—Bring Your Own Device—in which the IT department takes over and installs a bunch of company software to your personal phone. There is a better way, though, and it’s called a “dual-persona smartphone”—a way to have separate work and personal data on a single device. Blackberry was the first to have it baked into the OS in BB10, but in terms of OSes that users actually want to use, it’s been left up to often-clunky third-party solutions.”
9) Twitter cuts off Meerkat, won’t let it import who you follow on Twitter
Ah, the perils of developing an application on another company’s infrastructure: they can either buy you or buy your competitor and shut you down. Since there are very low barriers to copying a popular application, there tends to be multiple competitors which emerge for any popular new application which arises. This means the infrastructure owner (Twitter in this case) can hold a reverse auction to determine who it will buy for the lowest cost before shutting down all the others. Not a compelling investment environment if you ask me.
“Meerkat, the new livestream sharing app, has taken the tech world by storm. It’s easy to see why, too, seeing how the app lets you easily share your live video streams with your Twitter followers. It could even import the accounts you follow on Twitter, as well as those who follow you: That way, you’ll be able to see what your Twitter friends are doing on Meerkat, all without having to find them and add them manually. But according to Mat Honan at BuzzFeed, Twitter unceremoniously blocked Meerkat’s access to its “social graph,” thereby rendering Meerkat’s contact import feature inoperable.”
10) Battle for African Internet users stirs freedom fears
I have covered the positive impact mobile communications has had in the developing world in the past by offering banking to people who never had it before, as well as price discovery, etc., for farmers and small business owners. The logical next step is a roll out of some measure of Internet service, which requires some degree of infrastructure and an appropriate regulatory environment. Large, US Internet companies like Facebook and Google are experimenting with various methods of delivery and this is not without controversy. My suspicion is that there activities are only a first step: once market interest has been demonstrated, local entrepreneur will step in.
“Critics, however, say big service providers and Internet companies are luring African users into using their services, giving them opportunities for greater advertising revenue. “It’s like a drug pusher giving you a small amount and saying: ‘If you want more, you have to come and buy it’,” Africa Internet access specialist Mike Jensen said. Giving Africans free access to some Internet sites may also stunt innovation and limit the opportunities for African entrepreneurs, making online technology another industry on the continent dominated by big foreign companies.”
11) Wi-Fi Is About To Undergo a Huge Change
Home Wi-Fi is pretty impressive: I can set up a 600 mbps connection off a cheap router using 802.11AC. The problem is that there is limited capacity for high speed connections in a public place and more and more public places are offering some degree of free Wi-Fi. These technologies are astoundingly mathematically complex so it is truly amazing it can be crammed into a laptop for little extra cost or even sold as a USB “dongle” for $25.
“Get ready for superior Wi-Fi. At an event in San Francisco, component-maker, Qualcomm, demonstrated its contribution to this new technology, MU-MIMO. MU-MIMO (Multi-User Multiple-Input Multiple-Output) is a new technology that will be in many new routers, smartphones, laptops and other Wi-Fi devices. MU-MIMO is engineered to handle many wireless devices connecting to a wireless network at the same time. In fact, as more devices connect to a MU-MIMO-enabled Wi-Fi router or access point; the better network performance becomes.”
12) Cutting the TV cord? Call the anti-cable guy
The CBC has been running the odd story about cable cutting lately. It makes sense they would do so, since, unlike Bell, Rogers, and Telus, they have no reason to manipulate news coverage for to suit their corporate interests (http://business.financialpost.com/2015/03/25/crtc-chairman-says-report-bce-inc-manipulated-news-coverage-disturbing/) even if that might be illegal. Long story short, most Canadians have access to Over The Air HD content they might miss as they move to streaming services. There are people who show you how to do it. Besides an antenna you might want an OTA PVR such as this: http://nuvyyo.com/. It may sound expensive, but compared to ballooning cable TV rates, the payback is pretty short.
“The cable guy has a new competitor: the anti-cable guy. He helps you cut the cord on traditional television services and hooks you up with alternatives. Most Canadians still watch cable or satellite TV. However, cord-cutting is catching on as more people seek potentially cheaper and more versatile viewing options. But not everyone has the technical chops to break with tradition. So enter the cord-cutting consultant, a hired hand who does the job for you. It’s a small but growing business model fueled by expanding viewing options in the digital age.”
13) Manipulating Wikipedia to Promote a Bogus Business School
There are legions of paid agents out there manipulating various social media for financial, philosophical, and political reasons. It is remarkable, for example, how the same (false) talking points arise when criticizing, for example, telecommunications policies in North America. It was easy to see this when you were consuming corporate media, but it may not be apparent when looking are crowd sourced information such as Wikipedia. Setting aside the question of who in their right mind would rely on an online resource to chose their business school, the effectiveness of this campaign is remarkable as is the time it took for action to be taken.
“In February, “ArbCom” voted to expel “Wifione” from Wikipedia. No idea what “ArbCom” is? You’re not the only one. It’s the Wikipedia Arbitration Committee, the highest court in Wikipedia land. And Wifione was a Wikipedia “administrator” account, run by persons unknown, that was accused of manipulating the Wikipedia site of an unaccredited business school in India by deleting links to numerous media reports alleging it scammed students into paying hefty sums for worthless degrees. For four years, that Wikipedia page was a primary marketing tool of the Indian Institute of Planning and Management (IIPM), which at one time boasted a network of 18 branches and tens of thousands of students. It lured students with the promise of an MBA and partnerships with international universities in the United States and Europe.”
14) Ford cars slow when they see speed-limit signs
This is another example of the rapid advance of high technological safety systems for automobiles: the car keeps track of speed limits and (optionally for now) obeys them. There are obvious potential problems with this type of approach as visibility can sometimes be an issue and there are many places where the default speed limit is not posted. Eventually, of course, Vehicle to Infrastructure wireless systems (see item 15, below) will accomplish the same thing in a more robust fashion and probably automatically issue a citation when you speed.
“Ford is to sell a car that can read road signs and adjust its speed accordingly to ensure the vehicle is not driving too fast. The speed-limiting tech can be activated via the steering wheel and briefly overridden by pressing firmly on the accelerator. The car company suggests the facility will help drivers avoid fines and could reduce the number of accidents. However, one expert said the innovation might only serve as a “stopgap”. “There’s a plan for speed restrictions to be beamed to your car’s computer systems and controlled from there, rather than requiring street sign visual recognition systems,” said Paul Newton, an automotive industry analyst at the IHS consultancy.”
15) Car-to-Car Communication: A simple wireless technology promises to make driving much safer.
This article touches on Car to Car (or Vehicle to Vehicle V2V) communications systems, yet another high tech safety system. The thing with V2V is that is probably has limited effect when penetration is low and probably encourages unsafe behavior to boot. For example, if I have V2V and most cars have V2V I might not look as I leave an intersection and end up getting broadsided by Brian’s old pickup truck. There might be room for some form of mandated transition where all cars are required to have, for example, a transponder on board in order to be licensed. Similarly, there might be a requirement for such a system to alert drivers via a Vehicle to Infrastructure (V2I) system about speeding, slippery roads, and so on.
“I was in the passenger seat as Krishnan wheeled around a corner and hit the gas. A moment later a light flashed on the dashboard, there was a beeping sound, and our seats started buzzing furiously. Krishnan slammed on the brakes, and we lurched to a stop just as another car whizzed past from the left, its approach having been obscured by a large hedge. “You can see I was completely blinded,” he said calmly. The technology that warned of the impending collision will start appearing in cars in just a couple of years. Called car-to-car or vehicle-to-vehicle communication, it lets cars broadcast their position, speed, steering-wheel position, brake status, and other data to other vehicles within a few hundred meters. The other cars can use such information to build a detailed picture of what’s unfolding around them, revealing trouble that even the most careful and alert driver, or the best sensor system, would miss or fail to anticipate.”
16) No, Tesla Is Not Releasing a ‘Self-Driving’ Car This Summer
You might recall that, bundled in the hype and hysteria associated with Tesla improving their fuel gauge was the somewhat lesser hype and hysteria about the company releasing self-driving cars this summer. Not surprisingly, when you say “auto-steering capability being added on in the summer will make it possible to drive a Tesla “from San Francisco to Seattle … parking lot to parking lot,” without any human driver input at all” people are gonna think, well, aren’t their contiguous parking lots through out the US? Settling aside liability issues, Tesla is, at best, playing catch up with the rest of the auto industry in the most important technological shift it has experienced in the past 100 years. Whether a tiny company with limited resources can, in fact, deliver any degree of autonomous driving (unlike that shown by real car companies) remains to be seen.
“Elon Musk this week offered a peek at some new driver-assist capabilities Tesla will be adding to its vehicles this summer, prompting a bit of a rush in the media to declare that Silicon Valley’s favorite auto maker is about to launch a “self-driving” car. Well, no, it’s not. And the funny thing is, the miscommunication about what Tesla is actually doing with its upcoming software upgrade for Model S and Model X electric vehicles (EVs) can’t be blamed on Musk—who can certainly be overly effusive when talking about his cars and rockets and hyperloops, but was actually pretty circumspect during Thursday’s conversation with press and analysts.”
17) Automakers race to double the driving range of affordable electric cars
They can race all they want, but physics gets in the way: either you increase battery capacity or you increase “fuel” economy or a bit of both. Battery price/performance has been improving at a glacial pace and there is no reason to believe that will change any time soon. Moving to lightweight materials can help, but batteries are quite heavy. I figure the EV market is a race between making them good enough and cheap enough fast enough, which is hard to do because of physics, or consumers realizing that any EV has zero value after 5 to 8 years because the battery pack, which represents much of the cost of the car, has to be replaced.
“Global automakers are readying a new generation of mass-market electric cars with more than double the driving range of today’s Nissan Leaf, betting that technical breakthroughs by big battery suppliers such as LG Chem Ltd will jump-start demand and pull them abreast of Tesla Motors Inc. At least four major automakers — General Motors Co, Ford Motor Co, Nissan Motor Co Ltd and Volkswagen AG (VOWG_p.DE) — plan to race Tesla to be first to field affordable electric vehicles that will travel up to 200 miles (322 km) between charges. That is more than twice as far as current lower-priced models such as the Nissan Leaf, which starts at $29,010. The new generation of electric cars is expected to be on the market within two to three years.”
18) Biodegradable 3D Printed Artificial Bone that Adapts to the Human Body
A misleading headline and a very short article thin on details. The tests involve rabbits, not people, though there is obviously potential application to people. The idea is to build a sort of biodegradable scaffold which is replaced by real bone over time. This could provide an alternative to the use of cadaver material, especially when the particulars of the injury call for a custom made solution. It ight make sense, for example, to replace a shattered bone with a custom made scaffold rather than trying to reassemble it with plates and screws as is done currently.
“Animal studies and trials are some of the few requirements in the pharmaceutical and surgical industries that need to be provided if a new drug or a medical technology is to be introduced to the public. This week, scientists at Xi’an Particle Cloud Advanced Materials Technology Co., Ltd. have successfully carried out a round of animal testing on their medical procedure that allows the fabrication of completely biodegradable intricate artificial bone structures. The trials conducted by the team of scientists at the Department of Orthopedic Surgery at Xijin Hospital in Xi’an, China focused to ensure the safety of inserting a 3d printed body part inside a human body.”
19) Scientists have figured out how to inject human eyes with night vision
This isn’t an injection, it is eye drops, and the effect appears to be relatively short lived. Apparently, these guys have tested a way to boost the light sensitivity of the human eye, which is pretty impressive. The problem I would see with this “boost” effect is that those who are treated with the solution might be extremely light sensitive until the effect wears off, although, as the article hints, sunglasses could take care of that. Besides helping with night blindness, one could imagine this approach could be used to treat soldiers, pilots, or SWAT teams prior to a night operation in order to avoid the limitations of night vision goggles.
“A team of biochemical researchers in the US has figured out how to give a human volunteer night vision, allowing him to see across a distance of over 50 metres in total darkness for several hours. The key is a natural, light-sensitive substance called Chlorin e6 (Ce6), which is derived from sea creatures and has been used for many years in cancer treatment research. It’s also been shown to be effective in the treatment of night blindness and improving dim light vision in people with eye disorders, so an independent team of self-described ‘bio-hackers’ in California called Science for the Masses decided to see how else it could be used to improve vision.”
20) Amazon Goes After Dropbox, Google, Microsoft With Unlimited Cloud Drive Storage
In general, cloud services are a race to the bottom: every new server is cheaper than the one it replaces, or the one which was installed a month ago. This sets up a curious dynamic where an actual, non-manipulated positive ROI is hard to realize: the new entrant always has a cost advantage over the established players. Some businesses have conjured up schemes where hapless consumers are unknowingly paying the electricity bills for other people’s cloud services by they will eventually catch on. I recommend against using any cloud service for storage unless you can afford to lose the data. Cloud storage companies are notorious for shutting down or modifying their services and, if you have much data stored the time and cost to move it somewhere is prohibitive. This especially holds true for businesses. Either buy your own NAS, share some with friends, or get cheap external backup drives.
“Last year, Amazon gave a boost to its Prime members when it launched a free, unlimited photo storage for them on Cloud Drive. Today, the company is expanding that service as a paid offering to cover other kinds of content, and to users outside of its loyalty program. Unlimited Cloud Storage will let users get either unlimited photo storage or “unlimited everything” — covering all kinds of media from videos and music through to PDF documents — respectively for $11.99 or $59.99 per year. And those who want to test drive it can do so for free for three months.”