Telco Busting Business Model #487

Imagine for a minute all iPads were 3G enabled.  Now, imagine that no data plans were sold with them.  Next, all users get free access to the iTunes app store.  Now, everything is an app.  Connectivity is an app (for random browsing).  Bundles of call minutes could be sold as an app.  Text and instant messaging too, if anyone still pays for that stuff.  All other apps would have access bundled with them in a 3G context, in the same way as books for the Kindle have access bundled with them.  Telcos become infrastructure providers for consumer electronics and applications (media) providers.  The end.

Java, Oracle, and The Patent Disco

** Full disclosure – your correspondant works for IBM, though this is entirely a personal view.  He does not work in the patent side of the business. He also holds IBM shares.

The tyranny of lawyers is descending upon us.  When Oracle bought Sun, most of the headlines concentrated on Oracle’s new found love for hardware (notwithstanding its insistence on the irrelevance of cloud computing).  As a software company, however, it was its merger with the doyen of Open Source Software that was more important.  MySQL, OpenOffice, and in particular the Java programming language were managed by Sun, were now to be housed in one of the most profiable software companies in the world.  The Sun ecosystem had been driven around hardware sales, but how would ‘free’ software sit inside Oracle?  One blogger wrote that “Oracle could finally democratize the JCP (Java Community Process) by making it more transparent and inclusive,” though most were more circumspect.  The majority of concern centered on MySQL, a free database that clearly competed with Oracle’s core software business.

Slowly however it began to dawn on the outside world that the rationale for the acquisition may have been driven more by the lawyers than the technology strategists.  The R&D credentials of Sun were huge.  The patent register was impressive.  The extent to which Oracle could use its ownership of Sun to ward off nefarious encroachment by all sorts of interlopers who would steal its clothes.  It became obvious for Oracle’s actions not immediately, as speculation focused on how and whether Oracle would deal with the hardware business.  But in 2010, Oracle launched a lawsuit against Google for a billion dollars because Android had been written in Java.  Huh? Yeah.  Suddenly, everyone got jittery.

Google bought Motorola Mobility, substantially for it’s patents.  Facebook, Yahoo and Microsoft all executed moves to develop their patent portfolio.  Facebook recently countersued Yahoo with a patent it had registered by a former Yahoo employee!  The great Daddy of them all IBM spends $6bn a year on R&D and has led patent registrations for many, many years.  Apple’s patents- the subject of many high profile battles with Samsung and others – are primarily hardware related.

Now, we’re seeing a rash of litigation that threatens to undermine the entire technology business.  Value, and the openness that has characterised the innovation of the Internet, is pushed into the background as defensive landgrabs from major ecosystems and major (predominantly US) players establish what appear to be zones of control.  Oracle’s case against Google – is particularly interesting in that it posits that the Java language is itself intellectual property (rather than the code / binaries that it produces) and therefore that Google’s android software owes Oracle compensation for its use of Java.  The thing is, an enormous amount of the world’s software is written in Java.  That would mean undermining a massive swath of the economics of the software business – and potentially massively enriching Oracle.

One can’t get away from the sense that this is only the first act – and that the main event will happen when these US behemoths take on the Indian and Chinese companies that are coming in the next decade or two.  And the lawyers will be in the vanguard.

IBM Selectric – a fond remembrance

selectric stamp July 31st was the 50th birthday of the IBM Selectric,  which may have been the most popular typewriter ever sold [link]. The swappable typeball was revolutionary for its time, and to quote Wikipedia.

The possibility to intersperse text in Latin letters with Greek letters and mathematical symbols made the machine especially useful for scientists writing manuscripts that included mathematical formulas. Proper mathematical typesetting was very laborious before the advent of TeX and done only for much-sold textbooks and very prestigious scientific journals.

In 1997, it was time to publish my PhD. thesis (100 plus pages and well over 100 formulas), I found a typist in NYC who would charge $1.00 per page plus $1.00 per formula. Even though the symbol  typeball made formulas possible, it still took her longer to do a single equation than a whole page of text. My how technology has changed but I think having gradually absorbed new technology I still underestimate its impact.

Then yesterday, I came across this wonderful post [link] on a group of college journalist who tried to publish a newspaper using technology from just twenty years ago (but there is no 1 key !!!, use the lowercase L instead). Besides their experiences, there are a couple  of memorable quotes that I found quite profound.

While archeologists try to recreate what life was like 10,000 years ago, and historians try to recreate what life was like 1,000 years ago, journalists can’t even recreate how they published a newspaper 20 years ago. No one documented the details or saved the old equipment. (I had to buy some of it from creepy old men through Craigslist.)

We are losing touch with old technology and while we are relatively good at saving content, the processes are being lost at an alarming rate. The second quote was from one of the student journalists.

Technology hasn’t made us lazier, but it has made it possible to be lazier while still producing the same amount of quality work. Now that I’ve realized this, I know I’ll definitely be working faster to produce more quality news. And unlike the ancient civilizations of the 20th century, I’ve got the technology to do it.

that is something to think about.

The real 3D revolution ~ forget the movies

There has been a lot of press about 3D at the movies and it seems that every so-so movie ( anyone seen Drive Angry 3D?) has to be filmed in 3D, even if most of the public wonders why. Avatar has a lot to answer for! Although thankfully, none of the major Oscar contenders had to rely on the 3D gimmick to get their message across.

So where is the real 3D revolution. It is is in printers gyroidof all things. An excellent summary of the technology can be found in the Economist. Basically, using the the same technology used by ink-jet printers, 3D objects are printed by laying down layer upon layer until the object is complete. While now limited to certain plastics, resins and metals, this approach has the potential of manufacturing. The benefits are enormous. Using ‘additive manufacturing’ can result in material use of 10% when compared to traditional milling techniques, it is also software-defined, so changes can be made very easily and the new ‘blueprint’ sent digitally.

We are not far off from the day, when you receive a recall notice for a faulty part in your car, you will take it down to the local service station and they will manufacture the part then and there.

But I don’t think things will stop there, in much the same way that the personal computer put computing power previously reserved for large businesses in the hands of the Joan and Joe Consumer, the same will happen with custom manufacturing. Already there are companies, like “Shapeways” and “Digital Forming” that provide a design interface and the manufacturing supply chain to allow consumers to create unique bespoke items.

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Just came across this amazing talk by Anthony Atala from the TED conference. He shows a human kidney being printed. Science is wonderful.

Supporting the Cause

[In the interest of full disclosure, my son works for Creative Commons]

While WikiLeaks and the reaction to it has been getting all the publicity, it is opportune to also remember other groups that make the ‘open internet’ a reality, such as Creative Commons (CC).  While there are many many definitions for the ‘open internet’. To me, it means ”facilitating the sharing of ideas and content while allowing for the protection of the original authors and other contributors”. Creative Commons supplies the tools to make this possible, whether it is allowing anyone anywhere to freely build on and translate MIT course materials, run a course at the Peer 2 Peer University on anything from Web Development 101 to Digital Journalism, or contribute to the incredible sum of knowledge that is Wikipedia. DSC_0649_edited-2

I, like many others, extensively use CC licensed works (including this blog) and the reverse is also true, the accompanying photograph is appearing in an Israeli online text  book written in both Arabic and Hebrew, which I think is kind of cool. This type of sharing is made so much easier through the efforts of Creative Commons.

So the questions I am asking you to consider are: How do openness, creativity, and innovation impact your every day life? How much more interconnected is your world now that music is remixed, videos are shared online, and educational materials can be downloaded before they’re bound in paper?

Creative Commons provides the tools necessary to make sharing, adapting to new paradigms, and the expansion of creativity possible. Help them make the world bigger and better by supporting their 2010  fund drive. [link]

The Irish Condition

Perhaps a little far from mobile coups d’etat, but the Irish Sovereign Debt Crisis has been nothing short of brazen – and then some.  The divertissements of this contributor have been consumed with bond yields, contagion, strategic default, the extent of European political union, and the rights and the wrongs of it all.  So it’s hard to think about mobile phones and all that stuff; it’s nigh impossible to read about anything else in this country right now, notwithstanding the omnipresent Internet.

So for our foreign friends out there, I thought I’d paint a picture of where we are, and where we have come from.  Ireland began to boom in the late 1990s.  Things were looking up, the Global economy was doing well, and as the boom got boomier, to quote our grammatically challenged former leader, our GDP grew and grew, and the tax take grew.  Most was driven by foreign direct investment in the early to late 1990′s, but post-September 11th, as the world economy stalled and wondered what it should do next, the Government of the day decided that in order to maintain growth in the economy, it should incentivise economic activity domestically, particularly in the property market.

So tax breaks were introduced for developers.  Special schemes to develop depressed areas such as former seaside “resorts” (this author’s home town included) allowed wealthy people to buy apartments and write off their investment against their taxes for ten years.  A whole raft of incentives were introduced, and the tall cranes began to sprout up everywhere.  Concurrently, buyer reliefs such as mortgage interest tax relief compounded the situation – for both investment and primary properties – and prices to rise.  Builders could not build houses fast enough.  There were queues of people to buy houses that had not already been built yet, ready to lodge massive deposits (borrowed, of course) in case they may get “gazumped“, that wonderful phrase that now seems so quaint looking back, where a builder would take an order, and between that point and the order being contracted, the builder decides to go for another twenty grand.  This was clear profiteering, and usually the people stumped up the cash.  If they had it.

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Phrase of the Day–“Patent Thicket”

We are all somewhat used to one technology firm suing another for patent infringement but they tend to be treated as isolated instances. (see NY Times). However when you look at the bigger picture as Tech Crunch has done below, you have to wonder how anyone can produce a new phone, let alone a ‘smart’ one.

Patent Thicket

I sort of remember back when Ericsson, Nokia, Qualcomm and Motorola ruled the smartphone market (2G days) that patent licensing could make up to 30% of the cost (worst case) although 5% was more typical and because of cross-licensing much less than that amongst the big 4. With the mess above – “patent thicket” sums it up beautifully , the barriers to entry and innovation are becoming inordinately high. Of course, as innovation stalls, there will be a silver lining as everyone keeps their phone for longer and the number of phones in landfills is reduced.

The Economist has also commented about this subject. They make the point that the rise of open source platforms throw a spanner (wrench) into the mix and disrupt the proprietary models of other major players (Microsoft, Apple, Nokia etc.)

Patent Thicket image from http://www.flickr.com/photos/floorsixtyfour/5061246255/