The Geek’s Reading List – Week of April 3rd 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) Meerkat is dying – and it’s taking U.S. tech journalism with it
Manipulation of media is an old trick so it is not surprising the same tricks are used in online tech journalism. Given the low pay (for those who are paid) alternative business models, such as graft, are bound to emerge. At least this results in a democratization of media manipulation – pretty much anybody can afford to corrupt online media. Nevertheless, it is hard to feel bad for the investors who relied on fawning coverage for their investment decision: investment research has devolved into seeking the opinion of others rather than developing subject matter expertise. Thanks to my friend Duncan Stewart for this article.
“About three days after it received a lavish new funding round, Meerkat died an ugly and embarrassing death. It is hard to decide whether the Great Meerkat Debacle that has unfolded over the past week is a tragedy or a comedy — probably a bit of both. The mobile streaming app that had whipped U.S. tech journalists into a frenzy announced $14 million in new funding on Thursday. Money poured in from Jared Leto, Greylock Partners and other illustrious sources. On the same day, Twitter launched its rival streaming app called Periscope. Apparently, investors didn’t stop to ponder why Meerkat people rushed to cash in so aggressively only a month after the app had debuted. Well, we now know why.”
2) 5 Sad Facts About America’s Ridiculously Slow Internet
It is hard to believe that the US and Canada once had globally leading telecommunications infrastructure but 20 years of incompetence or corruption (I favour the latter since I find it hard to believe the regulators are that stupid) has taken care of that. Unfortunately, the actual report requires registration where you have to fill in a whole bunch of stuff I simply made up (except the email address) http://www.akamai.com/stateoftheinternet/. Canada is #20 in terms of average connection speed or #27 for peak speed and only 38% of Canadians who are connected have access to speeds over 10Mbps. I do not expect this decline to reverse any time soon unless and until a modern broadband infrastructure is recognized by government as important (as it was 30 years ago) nothing will change. Discussions with government officials and industry movers and shakers show a degree of obliviousness that is hard to fathom. So maybe it is stupidity and corruption, with stupid politicians appointing corrupt regulators.
“If you want fast internet, you’d be better off moving to Latvia than settling down in middle America. Or South Korea, Hong Kong, Japan, Sweden, Switzerland, the Netherlands, Ireland, Czech Republic, or Finland. The US isn’t even in the top 10 countries with the fastest average connection speeds worldwide. In fact, Akamai only mentions the US in this part of the report to note that broadband adoption had dipped slightly (a “negligible 0.3 percent drop”) and to point out that “in the United States, 50 million people—or roughly 16% of the population—are not connected to the Internet.” Later in the report, Akamai points out that the global rank for the US is number 16.”
3) Havana wants Internet for ‘all Cubans’ by 2020
It is easy to mock this announcement, given the abysmal state of the country’s infrastructure (doubtless partly due to the economic blockade imposed by the US), however it suggests a profound transformation in the Cuban government’s attitude in general. After all, they at least realize the importance of ubiquitous Internet access, which is more than we can say for our own government.
“Havana announced Thursday it wants “all Cubans” to be connected to the Internet by 2020, a goal the United States says will be difficult given the government’s communications monopoly. The communist island already has one of the world’s lowest connectivity rates, with only 3.4 percent of the population able to access the Internet from home in 2013. “The Cuban government is working to ensure that the IT resources and Internet are available and accessible to all Cubans” in five years, Communication Ministry IT director Ernesto Rodriguez said, according to the official news website Cubadebate. A push to include all households reaches beyond a goal set by the United Nations for 50 percent of the population in developing countries to have Internet access in five years at a price of less than five percent of their monthly revenue.”
4) Autonomous car completes 3,400-mile US road trip
This is a follow up of the Audi autonomous vehicle cross country road trip. The report is interesting in that it appears to be frank, mentioning that the driver had to intervene on a few occasions as unexpected challenges arose. The fact the car followed the speed limit is not surprising, as it would have been bad publicity if it had gotten a speeding ticket, or had a collision while travelling at over the sped limit. No doubt the route was carefully chosen to minimize the likelihood of unexpected challenges, nevertheless, this shows how far the technology has come.
“An autonomous car’s recent 3,400-mile U.S. road trip proves there’s at least one thing computers do better than humans: Follow the speed limit. Auto supplier Delphi Corp. fitted an Audi Q5 with radar, cameras and laser sensors to navigate the 15-state journey from San Francisco to New York, mostly traveling on highways. The car drove itself 99 percent of the time, Delphi said Thursday. Along the way, the autonomous Audi never drove above the speed limit, even when everyone else did. As a result, other drivers subjected the car—and its human occupants—to “a few hateful gestures,” said Jeff Owens, Delphi’s chief technology officer Jeff Owens. The person sitting in the car’s driver seat intervened once when traffic was weaving around in a construction zone, and again when the car didn’t want to move into a busy left lane to avoid police stopped on the right shoulder. The car also got a little skittish when it was next to semi-trailer trucks, edging over to avoid them. But for the most part, it easily navigated bridges, traffic circles and open highways, even in heavy rain, Owens said.”
5) Toyota to offer low-cost auto-braking and safety features
I consider this to be an important announcement: rather than offering advanced safety features in its most expensive vehicles, Toyota has decided to make them an option across almost their entire product line, and at a relatively modest price. I suspect that the entire product line will be covered as older models are refreshed. As the #1 or #2 car manufacturer, Toyota’s decision will put a lot of pressure on other vendors as well as lead to an inflection point in the number of equipped vehicles in the fleet. Astute insurance companies should offer rebates for vehicles with these systems, or even offer to cover some of the cost of the option. It would be good publicity and likely reduce their claims costs.
“Toyota Motor Corp. plans to bundle several advanced auto safety features that reduce the frequency of crashes into a low-cost option for its Toyota and Lexus vehicles. The features alert drivers to a pending collision and trigger the brakes, switch on high beams when there is no oncoming traffic, and warn drivers who drift from their lanes. An upgrade package alerts drivers to potential collisions with pedestrians and also brakes automatically. The move was lauded by safety experts who eventually want to see the technology become standard equipment on all vehicles.”
6) Why China May Have the Most Factory Robots in the World by 2017
Factory robotics are a continuation of automation trends which have been around for over 100 years. Virtually any task on the factory floor can be automated, it is just a question of cost where the important parameters are production volume and labour costs though high volume manufacturing is typically automated even with low labour costs because the quality and efficiency is so much higher. As the article notes, rising labour costs tilt the decision in favour of automation as is happening in China. One thing to note is that the robots Chinese factories are buying cost the same as the ones a North American factory would buy, thus levelling at least the machine labour part of the competitive playing field.
“Having devoured many of the world’s factory jobs, China is now handing them over to robots. China is already the world’s largest market for industrial robots—sales of the machines last year grew 54% from 2013. The nation is expected to have more factory robots than any other country on earth by 2017, according to the German-based International Federation of Robotics. A perfect storm of economic forces is fueling the trend. Chinese labor costs have soared, undermining the calculus that brought all those jobs to China in the first place, and new robot technology is cheaper and easier to deploy than ever before. Not to mention that many of China’s fastest-growing industries, such as autos, tend to rely on high levels of automation regardless of where the factories are built.”
7) FlexShapeGripper – gripping modeled on a chameleon’s tongue
Speaking of robots, this is a very cool gripper developed by Festo. The video is pretty interesting, however certain issues such as the weight which can be lifted, position precision, etc., are left unaddressed. So this might be cool but otherwise have limited application.
“The chameleon is able to catch a variety of different insects by putting its tongue over the respective prey and securely enclosing it. The FlexShapeGripper uses this principle to grip the widest range of objects in a form-fitting manner. Using its elastic silicone cap, it can even pick up several objects in a single gripping process and put them down together, without the need for a manual conversion.”
8) Qualcomm sees smartphone technology powering robotics
Robots are more likely to be developed as distributed systems, with a large number of lower powered processors rather than a small number of high powered processors. In fact, for some applications where cost is important, there is a good chance control will be handled over a wireless link to a cloud based platform, at least in countries with an infrastructure to support it. Either way, most likely robotics control nodes are almost certainly going to be implemented as “Systems On a Chip” (SOC) such as the ones inside smartphones. I doubt the same SOCs will be used because certain subsystems such as radar processing are not present on smartphone SOCs, however, astute SOC vendors should be able to get ahead of the trend with the right configuration of device.
“At Qualcomm’s robotics research lab, Vice President of Engineering Serefin Diaz scanned a living room with a tablet computer that contained the San Diego company’s computer vision technology. The screen began to fill in with a 3-D digital reconstruction of the television, coffee table and other living room furniture. That may not seem useful. But what if computer vision technology powered a robot that did housework? It automatically would know what to avoid while vacuuming or dusting without the need for specific programming. The demonstration highlighted Qualcomm’s belief that smartphone technology — sensors, cameras, processors and wireless connectivity — could drive the nascent consumer robotics market closer to the mainstream.”
9) What does the growing adoption of ad-blocking say about today’s digital advertising?
I am always shocked when I use a browser on a PC, phone, or tablet where ad-block software has not been installed. I have no idea how people put up with so much visual noise, let alone why they tolerate the waste of the bandwidth they pay for. As with the dying of radio (see next item) what should concern investors is the demographic shift: the youth who don’t watch ads become consumers who don’t watch ads. No doubt there are counter-measures in the works, though I rather doubt litigation will work.
“Demographically, the survey found that men and millennials are most likely to use ad blockers. Men are 48 percent more likely than women to block ads, and 41 percent of respondents aged 18 to 29 reported using the software. “This shows a generational mindset shift,” Giusto says, pointing out that young people will likely continue their ad-avoidance behavior as they grow in buying power and influence — a serious problem for the advertising industry in the future.”
10) Free Radio On My Phone!
If you have any doubts whether radio is a dying business, here is some evidence: an AstroTurf campaign to force smartphone vendors to enable the FM receivers purportedly present in existing smartphones. Although I rarely listen to radio since I discovered podcasts, I once owned a phone with a radio receiver and I liked it, especially when I was away from a coverage area. Today’s youth listen to very little radio, a trend which bodes poorly for the value of those cash machines and, in particular, the associated licenses.
“Today’s smartphones already have an FM receiver! This means that all listeners would have easy access to radio for the entertainment they love and information they need, but wireless carriers are dragging their feet and won’t activate the FM chips that are in every smartphone. FM radio doesn’t require an internet connection and won’t drain your phone’s battery. We need your help to make sure carriers hear this message: We shouldn’t be forced to pay to stream local radio – especially in emergencies – it should be FREE and at our fingertips. TAKE ACTION today!”
11) A Look Inside the Ask Toolbar Installed with Java for Mac
Distributing malware bundled with systems and software is not new but the fact “legitimate” companies such as Lenovo, uTorrent, and now Oracle appear to have embraced the practice is disturbing. It will probably take a class action suit to stop the practice (after all, there is no difference between malicious adware and this sort of thing under the law) or perhaps companies such as Google and Mozilla will simply disable the security certificates of these companies (a practice they have begun for other forms of “legit” malware) which would require the user to disable their browser security to install the malware.
“It’s back! And it’s likely here to stay. A few weeks ago, Intego pointed out that Mac users were no longer being offered to install the Ask toolbar during the installation of Java for Mac. At that time, the Ask toolbar had mysteriously disappeared from Java installations. We suspect that, due to media backlash, Oracle temporarily suspended the process that allows the JRE installer to install the Ask toolbar—depending on a country check.”
12) Up to 380,000 computer servers threatened as software support ends
Frankly, I was shock at this story, but not that the servers were vulnerable but that the government was using any Microsoft server software when a superior, more secure, more popular (51% market share), open source system (Apache on Linux) is available? How can anybody still be running a 15 year old server? The electricity saving alone would merit replacement!
“Microsoft Corp. is sounding a new set of alarms about a product that could soon be vulnerable to attacks by hackers. Less than a year after warning businesses and consumers about the end of support for its popular if dated Windows XP operating system, the company says it will drop support on July 14 for the Windows Server 2003 software that is in use on around 40 per cent of all Microsoft servers in Canada. In fact, according to Treasury Board Secretariat — the federal department responsible for computing equipment and infrastructure renewal — there are as many as 8,000 federal servers running the soon-to-be-decommissioned software.”
13) ‘Cultured meat’ could spell end of traditional cattle farming within decades, scientist behind lab-grown beef burger says
I find it amusing that the anti-GMO, “naturopathy is good”, crowd tend to be so enthusiastic about lab grown meat. The idea is intriguing, even though I doubt I’ll give up hunting because of it. Assuming market acceptance, I think the 20 or 30 year time frame for mass market products is reasonable, even though that scientists‘ predictions of “mass production costs” are typically unreliable.
“The Dutch scientist who served up the world’s first laboratory-grown beef burger says “cultured meat” could spell the end of traditional cattle farming within decades. That is the confronting message Maastricht University Professor Mark Post has for the Northern Territory Cattlemen’s Association, which is holding its annual conference in Darwin. “I do think in 20, 30 years from now we will have a viable industry producing alternative beef and there will be a growing market for it and eventually a really large market,” he said.”
14) Will Graphene-based Light Bulbs Be Graphene’s Commercial Break Out?
News of the world’s first first commercial graphene based product received some profile this week. I first saw a baffling article on BBC and found another equally confusing article on Financial Times. Unfortunately, as is common with such coverage, the reporter is spoon feed nonsense by a company and then he then writes up something he doesn’t understand. For example, was the device a light bulb or an LED? What benefit is graphene in an LED? This article shows I wasn’t alone in my confusion: the device is an LED, and the graphene simply acts as a thermal conductor. It is not clear why a small improvement to a heat sink would result in a 10% improvement in energy efficiency. Although I am a big believer in graphene, colour me sceptical on this one.
“The first mass market product made with the “miracle material” graphene is about to go on sale: a lightbulb. The invention is a dimmable LED lightbulb that can cut energy costs by at least 10 per cent and last for several years. Its developers at Manchester University say it is within months of going on sale. The bulb copies the classic design of the inventor Thomas Edison, but its filament has a coating of graphene, an atom-thick layer of carbon that is stronger than steel and conducts heat and electricity efficiently.”
15) Single-particle ‘spooky action at a distance’ finally demonstrated
Poor Einstein: one of the greatest geniuses in human history, a guy who revolutionized physics, and people delight in finding something he was wrong about. If you are interested in the experiment, the video is probably worth watching.
“For the first time, researchers have demonstrated what Albert Einstein called “spooky action at a distance” using a single particle. And not only is it a huge deal for our understanding of quantum mechanics, it also proves that the physics genius got something wrong. Spooky action at a distance, or quantum entanglement, in a single particle is a strange form of entanglement that could greatly help to improve quantum computing and communications. Unlike regular quantum entanglement, which involves two particles being defined only by being opposites of each other, single particles that are entangled have a wave function that’s spread over huge distances, but are never actually in more than one place.”
16) Sheep Marketplace Owner Arrested While Trying To Buy Luxury Home
The major applications of Bitcoin, and crypto currencies in general appears to be to sell illegal drugs, rip people off pretending to sell them illegal drugs, or to set up a marketplace and steal their Bitcoin. Interestingly, there is no evidence actually stealing crypto currencies is illegal, however, money laundering is. Pro-tips to would be cyber criminals, you want to cover your tracks a bit better, or, better yet, spend your profits where you can’t be extradited from.
“Thomas Jiřikovský, an alleged Owner of one of the most popular Darknet website ‘Sheep Marketplace,’ has been arrested after laundering around $40 Million, making it one of the biggest exit scams in Darknet history. After the arrest of Silk Road owner ‘Ross Ulbricht’ in 2013 — Sheep Marketplace became the next famous anonymous underground marketplace among Black Market customers for selling illicit products, especially drugs. But only after few weeks, Sheep Marketplace was suddenly disappeared and was taken offline by its owner, who had been suspected of stealing $40 million worth of Bitcoins at the time when Bitcoin market value was at the peak.”
17) Electric Car Demand Growing, Global Market Hits 740,000 Units
It sounds pretty impressive: unit sales of 320,000 in 2014, almost every one of which was heavily subsidized (see the next item). Mind you, General Motor’s US sales in July, 2014, were over 256,000 units, which kind of puts things in perspective. I figure the sales and subsidies will likely remain until people figure out that a 5 to 8 year old EV is worthless because the battery is shot. This will probably happen within a couple years or so.
“Demand for electric vehicles (EVs) is growing around the world fairly rapidly, according to new analysis from the Centre for Solar Energy and Hydrogen Research — with more than 320,000 new EV registrations in 2014, bringing the total global market up to 740,000 vehicles. Alongside that, battery suppliers saw strong growth — with total revenue hitting €2 billion ($2.17 billion), according the German research company behind the analysis.”
18) Tesla Buyers Making Twice U.S. Average See Rebates in Danger
This article is more speculation than anything else: after all, why should California taxpayers subsidize anybody’s auto purchase, let alone the purchase of an expensive sports car? The EV industry only exists because of subsidies, rebates, ZEV credits, and other non-cash incentives (like free parking, access to HOV lanes, etc.). These sorts of programs tend to be permanent so I doubt the subsidies will be reduced any time soon. However, as I note in the previous article, once EV owners realized they have been rewarded for buying a vehicle with an inherently short life and zero resale value, word will get out and the issue will become moot.
“California’s incentives to purchase electric vehicles are under attack, as data shows most of the money goes to consumers who earn twice the national average yet collect cash rebates on Tesla Motors Inc.’s luxury models. “It’s hard for the average Californian to understand why someone buying a $100,000 car should get a rebate,” said California state Senator Ted Gaines, a Republican who has proposed eliminating rebates on cars that cost more than $40,000. “That’s the same question I posed to myself, and it was hard to justify.” With almost a fifth of California payments applied to Tesla vehicles priced higher than $71,000, its regulators also are drafting rules to ration incentives based on income. While the state accounts for 40 percent of the U.S. plug-in market and has doled out more incentive cash than any other, such rebates are being scrutinized from Washington to Georgia.”
19) Despite Decades Of Deforestation, The Earth Is Getting Greener
Given the continual coverage of environmental calamities, raging forest fires, etc., this is an unexpected finding: the planet is actually “greening”. As the article notes there are a number of potential explanations for this and it is rather hard to put a negative spin on the finding (although I am sure there are efforts to do so). One can’t help but wonder if a similar situation is happening in the oceans. Thanks to my friend Duncan Stewart for this article.
“We developed a new technique to map changes in vegetation biomass using satellite measurements of changes in the radio-frequency radiation emitted from the Earth’s surface, a technique called passive microwave remote sensing. The radiation varies with temperature, soil moisture and the shielding of water in vegetation biomass above the ground. We extracted this vegetation information from several satellites and merged them into one time series covering the last two decades. This allowed us to track global changes in biomass from month to month, something that was not possible before. For the period 2003-12, we found that the total amount of vegetation above the ground has increased by about 4 billion tonnes of carbon.”
20) Goodbye GPS? DARPA prepares new tracking technology
I recall having read some time ago that certain types of accelerometers could be made so precise that they would be able to keep tract of your location based on your speed and time of travel. Based on the DARPA document (page 31) that seems to be the direction things are headed. This would allow for precise tracking, even indoors or under water. I don’t expect to see such a capability in a smartphone any time soon, however, unlike GPS, in which the US government controls the satellites, once this form of tracking is perfected it should be commercialized pretty rapidly.
“Finding GPS unreliable in certain situations, the U.S. government is placing a high priority on developing a more reliable real-time position tracking technology whose signals won’t disappear in blind spots and can’t be jammed. The Defense Advanced Research Projects Agency is developing “radically” new technologies to deliver a more advanced position- and navigation-tracking system that is more reliable and accurate than GPS, according to a document on DARPA research projects posted on Thursday.”