WiMAXis still too expensive for Ordinary Filipinos

By Victoria Ho, ZDNet Asia

28/04/2009

The price of WiMax CPEs (customer premise equipment) must fall to a cost-effective level for operators before the masses in rural areas of the Philippines can access the wireless broadband standard.

According to Happy Communications' CTO Raul E. Ocampo Jr., the current price of CPEs still prohibits operators from recouping their investments because of the low ARPU (average revenue per user) from the country's consumer demographic.

The Filipino WiMax operator's current user base consists of enterprise customers, making monthly ARPU of US$800 to US$1,000. Ocampo estimated consumer monthly ARPU to be that of around US$25 to US$30.

"CPEs need to get cheaper than US$100 to hit the sweet spot. Then WiMax will be a sure success," said Ocampo.

Manufacturers also need to shrink the size of current CPE models so they are "not so bulky", he added.

Happy Communications intends to roll out a consumer service in the fourth quarter of this year, but Ocampo said it is "not in a hurry".

He explained that customers in the Philippines do not display much brand loyalty to operators, so winning customers over when entering the market later will not be as challenging, and will also give the operator time to build out its infrastructure.

Operators eyeing the rural opportunity
With just 1 percent of broadband penetration seen in rural areas in the Philippines, Ocampo said opportunity is very high for WiMax operators.

Currently, broadband service is limited just to "key urban areas", he said.

Ocampo expects rural broadband connectivity to bring opportunities in VoIP (voice over Internet protocol) usage, with many looking to make cheaper long distance calls to Filipinos stationed overseas. Distance learning is another aspect of interest.

Philippe Berard, director of business development at wi-tribe, too spoke on the opportunity in the Philippines for the operator.

Berard said the country's regulator had put in a "pro-competition, pro-transparency" licensing model, making it easier for an overseas operator like wi-tribe to come in.

Communicating online is also building momentum in the Philippines, and the device ecosystem is building up. More Filipinos are buying laptops, and the government has helped stimulate PC penetration through price subsidies, he added.

With these factors, Berard said Internet penetration is expected to hit 33 million--33 percent of the population--by 2013.

"There is a large pent-up demand for broadband [because] there is no DSL (digital subscriber line) network and the copper network is poor," he said.

Both Berard and Ocampo were speaking at WiMax Forum Congress Asia '08, held in Singapore

Knockoff Cellphones made a hit sales in China

SHENZHEN, China — The phone’s sleek lines and touch-screen keyboard are unmistakably familiar. So is the logo on the back. But a sales clerk at a sprawling electronic goods market in this Chinese coastal city admits what is clear upon closer inspection: this is not the Apple iPhone; this is the Hi-Phone.

“But it’s just as good,” the clerk says.

Nearby, dozens of other vendors are selling counterfeit Nokia, Motorola and Samsung phones — as well as cheap look-alikes that make no bones about being knockoffs.

“Five years ago, there were no counterfeit phones,” says Xiong Ting, a sales manager at Triquint Semiconductor, a maker of mobile phone parts, while visiting Shenzhen. “You needed a design house. You needed software guys. You needed hardware design. But now, a company with five guys can do it. Within 100 miles of here, you can find all your suppliers.”

Technological advances have allowed hundreds of small Chinese companies, some with as few as 10 employees, to churn out what are known here as shanzhai, or black market, cellphones, often for as little as $20 apiece.

And just as Chinese companies are trying to move up the value chain of manufacturing, from producing toys and garments to making computers and electric cars, so too are counterfeiters. After years of making fake luxury bags and cheap DVDs, they are capturing market share from the world’s biggest mobile phone makers.

Although shanzhai phones have only been around a few years, they already account for more than 20 percent of sales in China, which is the world’s biggest mobile phone market, according to the research firm Gartner.

They are also being illegally exported to Russia, India, the Middle East, Europe, even the United States. “The shanzhai phone market is expanding crazily,” says Wang Jiping, a senior analyst at IDC, which tracks technology trends. “They copy Apple, Nokia, whatever they like, and they respond to the market swiftly.”

Alarmed by the rapid growth of counterfeits and no-name knockoffs, global brands are pressing the Chinese government to crack down on their proliferation, and are warning consumers about potential health hazards, like cheap batteries that can explode.

Nokia, the world’s biggest cellphone maker, says it is working with Beijing to fight counterfeiting. Motorola says much the same. Apple Inc. declined to comment.

Even Chinese mobile phone producers are losing market share to underground companies, which have a built-in cost advantage because they evade taxes, regulatory fees and safety checks.

“We’re being severely hurt by shanzhai phones,” says Chen Zhao, a sales director at Konka, a Chinese cellphone maker. “Legal cellphone makers should pay 17 percent of their revenue as value-added tax, but shanzhai makers, of course, won’t pay it.”

So far, however, China has done little to stop the proliferation of fake mobile phones, which are even advertised on late-night television infomercials with pitches like “one-fifth the price, but the same function and look,” or patriotic appeals like “Buy shanzhai to show your love of our country.”

Last month, the Ministry of Industry and Information Technology did warn consumers about the hazards of shanzhai phones, saying “their radiation usually exceeds the limit.” China’s consumer protection agency says faulty mobile phones were the No. 1 consumer complaint last year.

A few weeks ago, a 45-year-old man in south China was severely burned after his cellphone exploded in his shirt pocket, according to state-run news media.

But that hasn’t seemed to affect sales of black market phones, which typically sell at retail for $100 to $150. In the spirit of what is called “shanzhai” — which suggests rebels or bandits and which applies to counterfeit products of all kinds — many consumers are willing to take a risk on a cheap item that looks stylish.

“I saw iPhone pictures on the Web; it’s so cool. But it costs over $500 — too expensive,” says Yang Guibin, 30, an office worker from Chongqing. “So I decided to buy a shanzhai iPhone. I bought it in a digital market here; it looked exactly like the iPhone.”

Some experts say they believe the shanzhai phenomena is about being creative, Chinese style.

“Chinese grass-roots companies are actually very innovative,” says Yu Zhou, a professor at Vassar College. “It’s not so much technology as how they form supply chains and how rapidly they react to new trends.”

While the phones may look like famous brands, companies actually add special features like bigger screens, dual-mode SIM cards (which allow two phone numbers) and even a telescopic lens attachment for the phone’s camera.

Since it is the SIM card that makes a phone run in China, as in most places other than the United States, all you have to do is insert a valid SIM card into a shanzhai phone and it works.

All this innovation comes from an industry that only took off in 2005, after Mediatek, a semiconductor design company from Taiwan, helped significantly reduce the cost and complexity of producing a mobile phone.

Using what experts call a turnkey solution, Mediatek developed a circuit board that could inexpensively integrate the functions of multiple chips, offering start-ups a platform to produce a low-cost mobile phone.

The industry got another boost in 2007, when regulators said companies no longer needed a license to manufacture a cellphone.

That set off a scramble by entrepreneurs in this electronics manufacturing center. Counterfeiting and off-brand knockoffs flourished. Tiny companies would buy a Mediatek chip loaded with software, source other components and ask a factory to assemble them.

Marketing strategies were simple: steal. Designs and brand names were copied identically or simply mimicked. (Sumsung for Samsung or Nckia for Nokia.)

Tapping into the supply chains of big brands is easy, producers say. “It’s really common for factories to do a night shift for other companies,” says Zhang Haizhen, who recently ran a shanzhai company here. “No one will refuse an order if it is over 5,000 mobile phones.”

The people who make fake iPhones admit it’s a shady business.

“We are a kind of illegal producer,” says Zhang Feiyang, whose company, Yuanyang, makes an iPhone clone. “In Shenzhen there are many small mills, hidden. Basically, we can make any type of cellphone.”

The competition is already forcing global brands to lower prices, analysts say. And new Chinese brands are emerging, like Meizu, a would-be Apple that has opened stylish stores here.

“Our phone is even better than the iPhone,” says Liu Zeyu, a Meizu salesman in Shenzhen. “Our goal is to create a phone that makes Chinese proud.”

Chen Yang contributed research.

Counterfeiters turn to Cellphones

Technological advances have allowed hundreds of small Chinese companies, some with as few as 10 employees, to churn out what are known here as shanzhai, or black market, cellphones, often for as little as $35 apiece. This fake Louis Vuitto-branded phone was available at a mobile phone market in Shenzhen, China.

Lobby Mesin Voting memilih Software Voting Open Source

Matthew Burton | April 21, 2009 - 8:01pm
Companies who make proprietary products do not like open source alternatives to those products. They view open source products as a threat. Partly because they're free, but mainly because they have more potential.

So if the voting machine lobby published a report called "Open Source: Understanding its Application in the Voting Industry," (540K PDF) how much understanding do you think it would impart upon the reader? Either this document seeks to confuse, or its authors are confused themselves. The report is clearly targeted at those who make decisions regarding elections:

Legislators who adopt policies that require open source products, or offer incentives to open source providers, will likely fall victim to a perception of instituting unfair market practices.

I believe that a competitive market is usually the best way to get something done. But when it comes to securing and bug-proofing software, open source code will always be better. Incentivizing a better way is the government's job. They incentivize more efficient energy sources. Why not more transparent elections as well? (Plus, if there were one thing left alone by the marketplace, shouldn't it be a vote counter?)

The report devotes several pages to explaining how open source works. The assumption is that the reader is unfamiliar with open source, and they probably are: they are election officials, not developers or software lawyers. So the report does its best to portray open source products as leaderless and unmaintained:

It is likely that an open source project...would lack the structure to support products as they are fielded by local election officials. In addition to software support, the issue of accountability in such an open source environment remains an area for further research.

They ignore the fact that some companies' entire revenue models revolve around integrating, modifying and supporting open source software. Red Hat's market cap is twice that of Diebold's. I'm sure they can support your election.

The report also has a chart that compares the download statistics of a few open source election projects with some of the more popular file sharing programs. First, it's very dishonest to equate low usage with low quality. These numbers speak to demand, not quality. Free music is popular. Installing an electronic voting machine in your garage isn't. Even if the whole world adopted a standard open source election system, it would not be downloaded as often as a tool that lets you get free media.

Are the listed software products good? I don't know. But I do know that programmers seldom donate their time to software that people don't want. The more people clamor for something, the more time volunteers will devote to it. Because of the unique nature of election software--the average person has no use for it--the people with the power to adopt it are going to have to speak up in order for developers to commit themselves to it. If any people with such power are reading this, the ETC is trying to pull one over on you. They're trying to convince you that your own lack of demand for open source election software is the very reason you don't want it.

In any case, these download statistics make false argument. Nobody I know is saying we should abolish proprietary systems tomorrow and switch to an existing open source product. We're saying open source election software deserves attention and support, and effort to create a kick-ass system must be marshaled. When programmers donate their time, they do it for causes that they know people will benefit from. If they aren't making open source voting software, it's because the users (secretaries of state, county clerks, and the FEC) aren't asking for it. So please, do what the ETC is begging you not to do: start talking about open source voting software, and offer incentives to those who might make it.

Femtocells Pass a Standard Milstone

Posted by Carl Weinschenk Apr 13, 2009 5:06:11 PM
The finalization of a standard is important. Just ask the folks trying to work through 802.11n. In that context, the femtocell industry passed a major milestone earlier this month when a standard for Universal Mobile Telecommunications System (UMTS) femtocells was finalized.

The announcement, which was made by the Femto Forum, the 3rd Generation Partnership Project and Broadband Forum, said that the spec covers network architecture, security, management and provisioning and radio and interference aspects, according to Unstrung. Femtocell rollouts to date, the piece says, have been limited and the standard should help. It suggests, however, that improvements will occur “at a limited pace” and concludes by noting that ip.access and Ubiquisys announced compliant products and that similar announcements should be expected.

Tech Watch provides more information on the ip.access femtocell, called the Oyster 3G. Interestingly, the story doesn’t exactly say that the device is compliant with the new standard. Instead, it quotes the company as saying that an upgrade has made “significant process” toward that status. The other takeaway is a non-expert explanation of the standard’s importance. It says that it provides plug-and-play functionality and facilitates femtocells that are easy to install, scalable and cost-effective.

It’s wise to take research done by vendors that just happens to validate what they are peddling with a grain of salt. It’s also wise not to simply dismiss the findings. Results that the vendor doesn't like are more likely to be discarded than changed. Thus, it is entirely possible that those that are released are legitimate. With that as a preface, this InformationWeek piece describes research from Airvana, which offers femtocell technology under the HubBub label. The piece says the vendor ran three tests each in urban, suburban and rural settings and found that throughput exceeded 2 Megabits per second (Mbps) “on a statistically reliable basis.” Arivana and the writer of the story say the major selling point of femtocells is coverage. Thus, speed increases can be a powerful additional inducement to service providers and end users.

Will Franks, who lets us know what he thinks of his contribution to femtocells by the name of his site -- Femtocell Pioneer -- provides three data points on why femtocells are not just for the home. He says it is possible for businesses to put together what he refers to as “Lego bricks” of coverage that can be fitted into any space and expand or shift as needs change. He says that femtos' self-organizing nature eliminates the need for site surveys, or changes to the macro network, and that they are simple enough to be sold through existing direct and indirect channels.

Those who can still afford to attend trade shows invariably pick up a lot of useful information. That was true of femtocell shoppers visiting the recent CTIA show in Las Vegas. Femto Hub does a good job of rounding up the femtocell news from the show. On the Code Division Multiple Access (CDMA) side, Airvana demonstrated HubBub, AirWalk exhibited the EdgePoint Pro, Hitachi showed products developed in partnership with Airvana and Motorola won the CTIA Emerging Technology Best in Show award for its femtocell picture frame. Airvana, Tatara, Acme Packet and Starent Networks showed their products in network scenarios. On the CDMA side of the coin, Ubiquisys, Alcatel-Lucent and Airvana displayed products.

Much of what occurs for the balance of the year will depend on whether the economy improves. The good news is that the standards process seems to be moving along nicely and, perhaps more importantly, vendors seem ready to support customers who do materialize.

Microsoft Terancam Denda US$388 Juta karena Langgar Hak Paten

Microsoft terancam didenda sebesar US$388 juta karena melanggar hak paten milik perusahaan software anti pembajakan, yaitu Uniloc. Keputusan ini disampaikan oleh Federal Jury Rhode Island yang memutuskan perkara ini.

Software yang dipatent-kan itu akan menerbitkan identitas para pengguna lisensi untuk mendeteksi apakah legal atau tidak.
Diberitakan pula bahwa Microsoft akan melawan keputusan ini dengan menyatakan bahwa pihaknya tidak melanggar paten tersebut karena paten tersebut dianggapnya tidak berlaku.

Berita selengkapnya ada dibawah ini:

Posted by Lora Bentley Apr 10, 2009 2:29:05 PM

Here's an interesting patent law tidbit: Reuters reported Wednesday that a federal jury in Rhode Island entered a $388 million judgment against Microsoft for infringing patents belonging to anti-piracy software vendor Uniloc.

Microsoft, of course, will ask the judge to overturn the verdict. A spokesperson told Reuters, "We believe that we do not infringe, that the patent is invalid and that this award of damages is legally and factually unsupported."

The patent in question covers software that prevents unauthorized use of software by "generating unique identities for licensed users," the story says. The award is reportedly one of the largest on record in a patent case.

Empat Pelajaran dari Hasil Penyelesaian Kasus Pelanggaran HaKI Microsoft vs Distributor Open Source

Ada empat Pelajaran yang kita dapat dari hasil Penyelesaian Kasus Pelanggaran HaKI Microsoft vs Distributor Open Source, yaitu " Microsoft and TomTom Settle Patent Infringement Cases" dimana Perusahaan Distribusi OSS Tom Tom setuju mengambil paten berbayar dari Microsoft untuk lisensi penggunaan navigasi kendaraan, dan menghentikan penggunaan software File Allocation Table (FAT) yang di-klaim sebagai milik Microsoft, guna melindungi para pengguna produk Tom Tom. Ini menandakan bahwa konflik antar pengguna HaKI akan tetap ada selamanya, namun dapat diselesaikan melalui Pengadilan sebagaimana kasus-kasus lainnya yang biasa diselesaikan.

Adapun empat pelajaran itu adalah sebagai berikut:

1. Software Open Source bukan wilayah software HaKI gratis, karena keberadaan software Open Source adalah karena adanya HaKI GPL (General Public License).
   
2. Tuntutan Pelanggaran HaKI, termasuk atas OSS, adalah proses tuntut-menuntut biasa dan dapat diselesaikan (business as usual).
3. Tuntutan terhadap OSS memang dapat terjadi namun dapat diselesaikan seperti pada kasus Tom Tom diatas, dimana Tom Tom membayar hak paten yang dipakainya dan menghentikan penggunaan software FAT milik Microsoft.
4. Penyelesaian kasus2 tuntutan HaKI adalah baik bagi para pengguna Software itu, karena dapat menggunakan tanpa rasa ketakutan.

Rincian lengkap dari artikel " Four Takeaways from the Microsoft-TomTom Settlemen" ada terlampir dibawah ini:

by JeffSeul, Holland & Knight
Apr 8, 2009 9:28:58 AM

Whatever one thinks about open source software and software patents, the recent settlement of Microsoft's patent infringement lawsuit against TomTom illustrates that both are here to stay and that conflicts between owners of intellectual property rights (IP) at the intersection of the two can be resolved in the usual way.

To be sure, five of the eight Microsoft patents at issue in the case had nothing to do with the open source Linux operating system used in TomTom's car navigation devices. Microsoft stressed that its lawsuit was not the beginning of an assault on Linux(1), and Jim Zemlin, executive director of the Linux Foundation, characterized it as "a private dispute" and urged others not to jump to the conclusion that it was anything more(2). Nonetheless, the lawsuit – and its quick settlement – may tell us something about the ongoing evolution of the tech industry and how open source software (OSS) figures within it.

What does the Microsoft-TomTom settlement mean for tech companies and their customers? Here are four takeaways:

Takeaway 1: Open source software is not an IP-free zone.

There is a great deal of confusion among non-lawyers about the applicability of intellectual property (IP) rights to OSS. Perhaps contrary to popular opinion, the OSS model is based upon the existence of IP rights.

The most commonly used OSS license is Version 2 of the GNU General Public License, or GPLv2. As explained in the GPLv2 itself(3), it relies upon the existence of and ability to enforce copyrights, as does any software license. All licenses grant users a subset of the rights held by the software's creator, so long as users comply with the obligations and restrictions found in the license. For example, like other "copyleft" OSS licenses, the GPLv2 requires users to make any improvements (and related source code) available to the world only under the GPLv2, just as the original creator of the software chose to do. OSS also can be protected by patents, and it can infringe patents that protect other software.

The Microsoft-TomTom settlement is further evidence that sophisticated developers and distributors of OSS understand that OSS is not an IP-free zone. A settlement is not an admission of liability, of course, but TomTom's decision to settle quickly, on terms that require it to stop using some of Microsoft's Linux-related patents and shield its customers from lawsuits for infringement of other Linux-related Microsoft patents, presumably is a tacit acknowledgment that Microsoft's infringement claims need to be taken seriously.

1. See Q&A: Microsoft's IP Chief on TomTom, Linux and Patents (last visited Apr. 8, 2009).

2. See Note on MIcrosoft TomTom Suit: Calm Down, Hope for the Best, Plan for the Worst (last visited Apr. 8, 2009).

3. Paragraph 5 of the Preamble to the GPLv2 says, “We protect your rights with two steps: (1) copyright the software, and (2) offer you this license which gives you legal permission to copy, distribute and/or modify the software.” See GNU General Public License, version 2 (last visited Apr. 8, 2009).

Takeaway 2: IP lawsuits, including suits involving OSS, are just business as usual.

Traditional software companies have brought IP infringement lawsuits against one another for eons. Now, we not only see traditional software companies occasionally suing distributors of OSS, we see distributors and proponents of OSS suing others, both offensively and defensively(4).

For example, in September 2007 the Software Freedom Law Center, an organization that provides legal services to protect and advance OSS, filed an enforcement action against Monsoon Multimedia on behalf of the creators of BusyBox software, which is distributed under the GPLv2(5). The suit alleged copyright infringement for distribution of modifications to the software without making source code for the modifications available as required by the GPLv2. In Europe, guardians of OSS also are aggressively pursuing license violations as copyright infringement. A group called the gpl-violations.org project claims to have successfully enforced the GPL in over 100 cases between 2004 and 2006(6).

Patent related OSS litigation is also becoming common(7). Microsoft is not the first traditional software company to sue an OSS vendor for patent infringement, and TomTom is not the first major OSS distributor to settle a suit. In June 2006, Firestar Software sued Red Hat, a leading commercial distributor of OSS, alleging that Red Hat's open source Hibernate product infringed a patent covering Firestar's ObjectSpark technology(8). The companies have since settled the dispute.

In another recent case, Trend Micro, a developer of software that protects computers against viruses and spam, sued Barracuda Networks, a company that sells hardware containing open source anti-virus and anti-spam software, for patent infringement(9). In response, Barracuda Networks sought support from the open source community. It ultimately initiated a separate lawsuit to try to have Trend Micro's patents declared invalid(10) and another lawsuit alleging that Trend Micro was infringing three patents newly acquired by Barracuda Networks from IBM, which contributes to OSS projects and distributes OSS as part of its marketing strategy for its hardware and services offerings(11). TomTom used Barracuda Networks' defense strategy – counter-suing with patents newly acquired from a third party – in a patent infringement suit brought against it by another competitor, Garmin(12). Before the recent settlement, TomTom also sued Microsoft for patent infringement in response to Microsoft's lawsuit.

Patent infringement claims by OSS vendors aren't always defensive. Indeed, TomTom sued its Japanese navigation product rival Aisin AW last year for allegedly violating four of its patents(13). Barracuda Networks, TomTom and other OSS vendors are sophisticated companies that understand the IP environment and deploy both IP rights and OSS to their commercial advantage(14).

4. See generally Francis M. Buono and McLean Sieverding, Trend Spotting: Recognizing the Growing Risk of IP Litigation Facing OSS Developers and Implementers, METROPOLITAN CORPORATE COUNSEL, Vol. 16, No.9 (Sept. 2008).

5. Andersen et al. v. Monsoon Multimedia, Inc., No. 07-CV-8205 (S.D.N.Y. 2007) (settled). Similar suits have been brought against others. See, e.g., Andersen et al. v. Xterasys Corp., No. 07-CV-10455 (S.D.N.Y. 2007) (settled); Andersen et al. v. High-Gain Antennas, No. 07-CV-10456 (S.D.N.Y. 2007) (settled); Andersen et al. v. Verizon, No. 07-CV-11070 (S.D.N.Y. 2007) (settled).

6. GPL-Violations.org (last visited Apr. 8, 2009).

7. The following cases provide a few examples, in addition to those discussed in the body of this article: Jacobson v. Katzer, 2008-1001 (Fed. Cir. 2008); IP Innovation LLC v. Red Hat, Inc. et al., No. 07-CV-00447 (E.D. Tex. 2007); Network Appliance v. Sun Microsystems, No. 07-CV-06053 (N.D. Cal. 2007).

8. FireStar Software, Inc. v. Red Hat, Inc., et al., No. 06-CV-00258 (E.D. Tex. 2006) (settled).

9. Trend Micro initiated an action before the International Trade Commission seeking an order preventing Barracuda Networks from distributing the allegedly infringing products. Trend Micro, Inc. v. Barracuda Networks, Inc., No. 337-TA-624, 72 Fed. Reg. 74,329 (USITC, Dec. 31, 2007).

10. Barracuda Networks, Inc. v. Trend Micro, Inc., No. 07-CV-01806 (N.D. Cal. 2007).

11. See generally Ryan Paul, Barracuda bites back at Trend Micro in ClamAV patent lawsuit, ARS TECHNICA (July 2, 2008), (last visited Apr. 8, 2009).

12. See Press Release,Garmin Ltd., Garmin Obtains Complete Victory on TomTom Patents, Will Pursue Own Patent Claims Against TomTom (Dec. 23, 2006), (last visited Apr. 8, 2009).

Takeaway 3: Settlements of lawsuits involving OSS can and do occur.

All of the lawsuits mentioned above were settled. IP lawsuits, including those involving OSS, settle in one of the following ways, or some combination of them: the defendant stops using the plaintiff's IP, the defendant pays the plaintiff for a license to use it, or the parties cross-license IP to one another.

In the Microsoft-TomTom settlement, TomTom agreed to take a paid license under Microsoft's car navigation patents. While TomTom agreed to stop using the FAT LFN file system technology covered by two patents that Microsoft claims are infringed by the Linux operating system used in TomTom's navigation devices(15), TomTom will continue to use technology covered by two other patents that Microsoft claims are infringed by Linux. Microsoft agreed not to sue TomTom's customers based on their use of that technology(16).

Some people believe the GPLv2 prohibits all types of "discriminatory" settlements of patent suits, i.e., settlements that protect some licensees of GPLv2-covered software without providing the same protection to all other licensees. It does not. The GPLv2 prohibits agreements that cannot be honored while honoring the terms of the GPLv2(17), but it is possible to structure settlements and other agreements that do not induce anyone to violate the GPLv2. Microsoft has now reached several patent truces with companies that distribute software under the GPLv2, not least of which is its 2006 agreement with Novell. That agreement includes a covenant not to sue end users of products containing the infringing patents. Several leaders of the Free Software Foundation, including Richard Stallman, have publicly stated that the Novell deal is consistent with the GPLv2(18).

13. See TomTom sues Toyota navigation company, TRAFFIC TECHNOLOGY TODAY.COM (Feb. 18, 2008).

14. According to the online records of the United States Patent and Trademark Office, Dean Drako, the founder of Barracuda Networks, filed applications for two anti-spam related software patents long before Trend Micro sued Barracuda Networks: Patent Application No. 20060248575, titled "Divided encryption connections to provide network traffic security," filed on November 2, 2006; and Patent Application No. 20060238991, titled "Low profile expansion card for a system," filed on October 26, 2006. Both applications are still pending.

15. Some critics of Microsoft's suit against TomTom, like Bruce Perens, creator of the Open Source Definition, claim Microsoft’s File Allocation Table Long File Name (FAT LFN) patents are not innovative, implying, it seems, that they could be invalidated if challenged. See Bruce Perens: Analyzing Microsoft's TomTom Lawsuit (last visited Apr. 8, 2009). In fact, each patent has been affirmed twice by the U.S. Patent and Trademark Office, in the original examination and later during re-examination in 2006. U.S. Patent No. 5758352 was affirmed through reexamination on October 10, 2006, and U.S. Patent No. 5579517 was affirmed through reexamination on November 28, 2006. It also is well known that many companies have taken licenses under them. See TomTom Can License FAT Without Violating GPL (last visited Apr. 8, 2009).

16. See Microsoft and TomTom Settle Patent Infringement Cases (last visited Apr. 8, 2009).

17. GPLv2, Section 7.

18. See Transcript of Richard Stallman from the fifth international GPLv3 conference, Tokyo, Japan; 2006-11-21 (last visited Apr. 8, 2009).

Takeaway 4: Settlements are good for IT consumers, the people who matter most.

Litigation involving OSS is increasing, so it is good to see that suits involving OSS can be resolved in the usual way. Many tech companies, like TomTom (and Microsoft ), now pursue a "mixed source" strategy in which they distribute both open source software and proprietary software – often in the same product. Many OSS projects begin as labors of love, but most significant projects ultimately must find financial sponsors to survive and thrive. The Linux operating system, the Apache HTTP Server, the Firefox Web browser and other major OSS projects are supported by financial contributions and "volunteers" paid by major companies that produce revenue from products and services which are wholly or partially dependent upon the success of those projects. As Sun Microsystems explains in its 2007 10-K filing with the SEC, "[w]e build relationships with [the open source development community] to stimulate demand for our commercial products."

When software companies resolve their differences by agreement, they show respect for their customers, many of whom know and care little about the geopolitics of the tech industry, and all of whom want good products at reasonable prices that they can use without concern about debates among IP lawyers. According to Microsoft, for a year before it filed suit it tried to persuade TomTom to take a license under its patents. Given how fast the suit settled and the terms of the settlement, one wonders what changed from TomTom's perspective – except that it could no longer question whether Microsoft was serious. It seems a public skirmish could have been avoided, but the Microsoft-TomTom settlement is nonetheless another hopeful sign that the tech industry is evolving to accommodate different business models and development paradigms within the system of IP rights on which innovation for the benefit of consumers partially depends.

Why Businesspeople Use Twitter?

By John I. Todor, Ph.D., The Whetstone Edge, LLC

Are you Twittering? If not, don't you know that it is the fastest growing social network with seven million people using it?

If you are like me, you may have thought: "What will it do for my business? How much time will it take?"

To get some answers, I decided to interview some business people I know and respect—people who are successful and yet find time to Twitter. Armed with the insights I got from them, I started Twittering last week (johntodor).

Here is what I learned.

Lesley Russell, VP of Direct Marketing and Sales, St Supery Winery
Twitter username: stsupery

Twittering personally about 8 months, for business about 4 months.

What motivated you and how did you get started?

I kept hearing from marketing gurus that consumer brands needed to monitor their online reputation and Twitter was mentioned as one way to do so.

I started by searching Twitter for mentions of St. Supery and almost immediately discovered that people were talking about us and it wasn't all good. I came across a tweet by a woman in NYC saying she was disappointed in our Sauvignon. I responded by mentioning that I was sorry she was disappointed and offered to send her a different version of our Sauvignon Blanc. She was both surprised and pleased to hear from me. She loved the wine I sent her and said so on Twitter and in her blog. What I didn't know was while she is a PR Professional in her day job, she is also an amateur wine blogger with a big following.

Wine bloggers have a tremendous influence, so we invited a group of them to spend a day with us at our winery. They were twittering away all day long. Tremendous word of mouth.

In addition to monitoring and responding to comments, I answer questions like "When will the 2004 vintage of our Elu wine be ready to drink?" or "Where can I buy your wine in Florida?" I try to help our customers have a better experience with our wines.

Pamela Swingley, President of Savvy Internet Marketing
Twitter username: pamelaley

Twittering about 8 weeks.

What motivated you and how did you get started?

I am developing software for personal healthcare management and will be looking for investors in the near future. My background has been in the technology sector. I wanted to learn about the investment and healthcare communities, fast. I also wanted to start building visibility and credibility within both communities.

I searched for active Twitters in both communities and started following them. I quickly got a feel for the culture of the communities and started asking questions and adding my insight about Internet Marketing. They must like something I am saying because twice as many people follow me than I follow. I am learning and building credibility in a new industry.

I get great results and it only takes 15 minutes per day.

Randy Saunders, Senior Marketing Manager, Cincom Systems
Twitter usernames: randysaunders and cincom

Started Twittering about 9 months ago but only got serious 3 months ago.

What motivated you and how did you get started?

More and more business people I know were using Twitter, so 3 months ago I decided to make a concerted effort to figure out what you could do with 140 characters.

I started with two goals. One, I wanted to connect with a wider range of business professionals and to learn from them. Two, I wanted to monitor and enhance Cincom's online reputation.

In the first case, I was very pleasantly surprised to learn how accessible, open and personable many CEOs are on Twitter. I am also learning from people outside my core industry. Now I am educating others within Cincom of how to use Twitter.

One of the beauties of Twitter is that it is rapid fire and easy. People say what is on their mind. There is something very real about this type of communication.

Cincom's online forum, Expert Access, provides thought leadership on Customer Relationship Strategies and Business Process Management. We now use Twitter to promote it.

We also use Twitter to monitor mentions of our Call Center products and learn directly from our customers. It is also a good way to monitor what our competitors are up to.

I get on Twitter 2-3 times per day and try to keep the total time to 15 minutes per day.

Bill Flitter, CEO and Founder of Pheedo
Twitter username: bflitter

Twittering about one year.

What motivated you and how did you get started?

Curiosity. Pheedo is in the business of syndicating and aggregating content for clients. I wanted to see if we could use Twitter to syndicate our own content. I also wanted to know what people were talking about.

I started by using search tools to find people who were Twittering about topics that interested me. I was surprised by the volume of people chiming in. People let loose with whatever is on their minds. They also tweet about what is happening right now. Once I discovered #hashtags, I realized you could follow the conversation about a give topic, often as it was happening. People twitter about events they are at, while they are at them. How else could you get insights from conferences you are not at or get multiple opinions, now? Events now post the #hashtag on their site, just paste in the search window to learn what people are saying.

We also use Twitter for brand monitoring. We quickly find out if a client is having a problem and can respond. We poll people to see how widespread a problem is and allocate resources accordingly. We want our customers to have a good experience with Pheedo.com and we want them to know we are responsive. Twitter is a good way to do so.

I must admit that I am also a little cynical about Twitter. There is a lot of noise, a lot of posting of things I am just not interested in. I actually seldom get directly on Twitter.com. Rather, I use friendfeed.com as an aggregator of all my social media sites. I find this to be much more productive.

My digital center is my blog. This is where I share ideas and content and use syndication tools to distribute it to Facebook, Twitter and so on. For example, Twitterfeed.com converts my blog to an rss feed to my Twitter account. It stays within the 140 character limit and links back to the actual blog.

Mark Ginnebaugh, President of DesignMind
Twitter username: markginnebaugh

What motivated you and how did you get started?

I run several professional groups and was looking for ways to raise awareness and increase attendance at meetings. I also have a blog and wanted to promote it.

I started promoting my events, and within a week got results. People who never heard of our groups started showing up—because they were interested in the topic.

In addition to gaining visibility, I am learning a lot by being on Twitter. I try to only spend about 15 to 20 minutes per day on Twitter but often spend much more. I must warn you that if can be addictive.

If this article motivates you to Twitter, you might want to start following these people (see their Twitter username). If you are already Twittering, please share your insights and stories.

Here is a list of resources to help you use Twitter for business.

eBooks

• How to Use Twitter for Business: a Beginner’s Guide (free)
• The Twitter Power Guide: Advanced tips to make the most of Twitter (free)
• Twitter Means Business: How Microblogging can help or hurt your company ($17.95)

Articles

• 7 Marketing Mistakes to Avoid on Twitter
• Twitter: A Marketer’s Duct Tape
• From Twits to Tweeple, Why I Embraced Twitter and You Should Too (part one of a five part series)
• Beginner’s Quick Start Guide and Tutorial to Using Twitter (From Zappos)
• Twitter 101: Connie Benson provides a roundup of Twitter-related resources

Video

• Twitter in Plain English (Common Craft Show)

Taxing the Internet and Other Services

by Martha Zoller
(11/13/2007) and resent by Ardi Sutedja

Last week, the president signed into law a 7 year extension of the moratorium on state and local government internet access taxes. H. R. 3678, the “Internet Tax Freedom Act Amendment Acts of 2007,” prohibits multiple and discriminatory taxes on electronic commerce including internet access until November 1, 2014.

Ronald Reagan said, “Governments view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” He said that to the White House Conference on Small Business in 1986. More that 20 years later, it’s still true.

Use of the internet as well as commerce on it should not be taxed. There: I said it. This is a mode of communication and commerce that has equality at its base. A company, large or small, can look and compete in a free market and as long as the product is in demand and the access to the internet is unfettered, they can compete equally.

"The president's signing of the Internet Tax Freedom Act today represents a historic victory for small businesses, consumers, and all American taxpayers," Roger Cochetti, group director of U.S. Public Policy for the Computing and Technology Industry Association, said. He went on to say, "Congress' decision to extend the moratorium on Internet access taxes and multiple or discriminatory taxes on internet sales for an unprecedented seven years signals this Congress' firm belief that the Internet is priceless engine for economic, social and civic advancement in the United States that must not be burdened with discriminatory and abusive tax schemes," Cochetti said.

This is a big step in the right direction because when Congress starts taxing something, it’s never temporary. In 1898, Congress passed a levy of one cent per telephone call to help raise money for the Spanish-American War. By 1990, the tax was up to 3% of your overall telephone bill.

Over the last several congressional sessions -- including a bill introduced this year --Congress has made half-hearted attempts to repeal this tax. (Does anybody remember the last time Congress repealed any tax? And how are they spending the telephone tax dollars? They’re probably porking it out in earmarks.)

This federal excise tax on telephone service is only one of many taxes and surcharges that appear on the average phone bill. On average, 20% of the average phone bill is taxes, government fees, and other surcharges imposed or regulated by federal and state governments. I guess “Big Phone Companies” need to be taxed to control their growth -- or is it to encourage growth; I’m never sure about that.

Then there’s “Big Oil.” You know the evil oil and gas companies that are making record profits. The dirty little secret is federal and state governments are making record tax revenue. Some lawmakers have called for new “windfall profits” taxes -- similar to the one signed into federal law in 1980 by President Jimmy Carter -- that would tax the profits of major oil companies at a rate of 50%. Tax collections on the production and import of gasoline by state and federal governments are already near historic highs. The Feds are benefiting far more from “Big Oil” than the oil companies are. Since 1977, the Feds have collected more than twice the amount of domestic profits earned by US oil companies during the same time.

So are we ushering in the era of “Big Internet Taxes?” For the supposed party of the little guy, the Democrats, all they are doing besides investigating Republicans and “Big Business,” is trying to raise taxes on anything that they can find. Let’s leave the internet alone. In 1996, I put the first internet connection in my home. It was slow and expensive. Today, I am spending about 1/3 of what I paid in 1996 and the connection is light-speed faster. That’s what competition does. If you leave competition in the internet and e-commerce business, then there will be more choices up and down the line and the connections will be faster, better and cheaper. That is the American Way.

Americans can’t afford to have Democrats in power: we will be taxed to death. With the temporary tax cuts expiring in the next presidential term and the Democrat leadership proposing the taxation of the internet and everything else that moves there has to be a better way. And we know what it is: the path that Ronald Reagan took in 1981.

Republicans have not done enough to win back the House of Representatives or the United States Senate. Republicans were “born to cut taxes and make government smaller” as John Kasich, former Chairman of the Budget Committee in the House of Representatives says. He adds, but “we didn’t do either of them very well.” Republicans can -- must -- do a lot better. The alternative is to remain in the political wilderness for the foreseeable future.

---

Ms. Zoller is a political analyst and conservative talk show host for WDUN AM 550 in Gainesville, Georgia and syndicated on The Georgia News Network. She is one of the Talkers Magazine "Heavy Hundred" Talk Shows in America. She can be seen regularly on cable news. She is the author of "Indivisible: Uniting Values for a Divided America." You may contact her through www.marthazoller.com.

Will Cisco go into the smartphone business?

High end users do not just want attractive smartphones, but phones that perform at least one task really well. Hence the appearance of location-optimized phones from Garmin/Asus, social networking phones from INQ and other and the host of handsets that claim to be as good a music or camera experience as a dedicated MP3 player or digital camera. All this creates higher usage and more and more data traffic, which suits the operator - and Cisco.

The king of IP data traffic has increasingly looked to sell the devices that drive this traffic too, and recently added Pure Digital, maker of the Flip budget camcorder, to its portfolio. Surely it is only a matter of time before it brings out a smartphone, which could act as a focal point for all its consumer electronics and home networking devices, and even incorporate the Flip technology and other Cisco offerings like its mobile VoIP technology?

A research note from UBS summed up Cisco's interest on consumer devices. Pure Digital "will add to Cisco's arsenal of products aimed at driving increased network bandwidth … As more consumers upload video content to the web, it will also drive demand for Cisco's traditional products - switches and routers." The same could be said of advanced handsets, and there is a rising tide of reports that Cisco will produce one of these (or acquire a vendor) for mid-2010.

In a research note earlier this month, RBC Capital Markets' Mark Sue wrote: "Considering its big push into the consumer market, we believe Cisco may be developing a smartphone of its own, slated for mid-2010." Cisco has filed various patents in this area recently, including one for "managing time delays in relaying video wirelessly to consumer electronics devices"; and another for streaming video on a network connected phone. The frequency with which portable devices are mentioned in recent Cisco patent filings led even BusinessWeek to give credence to talk of a Cisco phone.

The magazine points out that, as of last fall, the networking company had sold 168m consumer gadgets (more than the total iPods sold), and has many of the components in place already for the whole wireless media story, at home and on the road. These include set-top box firm Scientific Atlanta, Wi-Fi leader Linksys and now Pure Digital, plus aggressive developments in telepresence.

And Ken Wirt, VP of consumer marketing, helped develop Palm's first non-enterprise product and was global head of marketing for the smartphone maker. Of course, this only adds to speculation that Cisco might make a bid for Palm, especially if the launch of the Pre goes less well than anticipated, depressing the price. "[CEO John] Chambers talks about consumer electronics all the time," Wirt says. "It's an area where we see a lot of potential upside."

Copyright © 2008, Wireless Watch (http://www.rethinkresearch.biz)

AP prevents it news access without payment: End of Web 2.0 Era?

Perusahaan Pers terbesar di Dunia Assocaited Press mulai melarang akses atas content-nya oleh masyarakat bila mereka belum membayar langganan buanannya. AP mengeluh karena banyak perusahaan lain yang mengeduk untung besar dengan menyebarkan content miliknya yang gratis. Oleh karena itu mulai sekarang AP akan mengharuskan para pelanggannya untuk membiayar biaya keanggotaan sebelum mereka dapat men-dowbload content.

Kebijakan ini bila di-ikuti oleh berbagai penyedia berita lainnya akan menyebabkan konsep bisnis Web 2.0 akan berakhir. Tentu saja di Era Masyarakat Informasi, akan terjadi penyesuaian-penyesuaian bisnis proses agar terjadi keseimbangan baru. Salah satunya adalah akan terjadi model bisnis baru, dimana akan muncul Agregator Berita baru dimana Ia akan memperoleh berita-berita secara gratis dari para Blogger yang tersebar diseluruh dunia, sehingga dapat dimanfaatkan oleh para pencari berita yang memerlukan.

Berikut ini kami lampirkan berita lengkap tentan Associated Press sebagai berikut:

The End of the Web 2.0 Free-for-All

“The latest moves by the Associated Press toward putting a stranglehold on its content online, making it unavailable to other online publications who aren’t paying for it, signals the impending end to the free-for-all that’s defined Web 2.0.”

The backstory is that for months the AP — a cooperative with more than 1,400 U.S. newspaper members — has griped that its content is unfairly used online. The first publicized incident occurred in June when the AP sent the Drudge Retort a cease-and-desist letter for excerpting and linking to its content. The debate was heightened this week when in a statement and at its annual meeting the AP affirmed that it will pursue legal action against online publications that use its material without paying for it or at least sharing revenue.

“We can no longer stand by and watch others walk off with our work under some very misguided, unfounded legal theories,” said Dean Singleton, AP chairman, in a statement. “We are mad as hell, and we are not going to take it anymore.”

The AP’s issue is with publications that excerpt and link to its content, and with search engines, like Google News, which aggregate news stories that may be using the AP’s content without paying for it.

And while we know it’s hard to take seriously anyone who quotes Network in an annual statement, there’s good reason for concern.

Over the last few days there’s been much back and forth contesting the AP’s argument, with Google saying its search engine is good for news organizations, The New York Times questioning whether Yahoo is more of a friend to AP than Google is, and experts like ThinkerNetter Scott Hilton exploring the legal issues.

But regardless of the finger-pointing, the underlying theme is clear: AP does not want to share its content with those who aren’t paying for it, and that changes things drastically.

The news organization is taking a lot of heat for not playing by the rules of the digital age, but it certainly isn’t alone. YouTube has been dealing with similar anger from the large networks who, oddly enough, don’t want their content stolen and uploaded on its site. Despite our collective delusion, the content of the world does not belong to everyone, and, yes, the people who pay for it do mind when you’re making money on it and they aren’t. Crazy, we know.

AP’s harsh tactics and legal threats are out of step with how the Internet works, which is why this is such a big deal. Most organizations operate under the pretense that excerpting and linking back to content is fair game on the Web.

But, despite our cries, the facts are clear: If organizations like the AP take a stand against this whole free-for-all, where what’s mine is yours and what’s yours is ours, it will signal the end of Web 2.0.

We can stomp our feet as we like and call the AP out of touch, but we can’t shun them completely and think the Web can otherwise survive. Without content from the big guys — the news organizations, the networks — the Web as we’ve come to know it does not exist. The large organizations operate as separate entities, and the underdogs who’ve been making some form of money off of them have to figure out how to stand on their own or share the little revenue they have for access.

When the people providing the content wake up to that fact, as the AP has, and start to pull it out from under the rest of us, that’s when reality will settle in for those whose livelihood and business model rely on its availability.

— Nicole Ferraro, Site Editor, Internet Evolution

News without Newspapers through an integrated Hyperlocal Web Sites

By CLAIRE CAIN MILLER and BRAD STONE

If your local newspaper shuts down, what will take the place of its coverage? Perhaps a package of information about your neighborhood, or even your block, assembled by a computer.

A number of Web start-up companies are creating so-called hyperlocal news sites that let people zoom in on what is happening closest to them, often without involving traditional journalists.

The sites, like EveryBlock, Outside.in, Placeblogger and Patch, collect links to articles and blogs and often supplement them with data from local governments and other sources. They might let a visitor know about an arrest a block away, the sale of a home down the street and reviews of nearby restaurants.

Internet companies have been trying to develop such sites for more than a decade, in part as a way to lure local advertisers to the Web. But the notion of customized news has taken on greater urgency as some newspapers, like The Rocky Mountain News and The Seattle Post-Intelligencer, have stopped printing.

The news business “is in a difficult time period right now, between what was and what will be,” said Gary Kebbel, the journalism program director for the Knight Foundation, which has backed 35 local Web experiments. “Our democracy is based upon geography, and we believe local information is such a core need for our democracy to survive.”

Of course, like traditional media, the hyperlocal sites have to find a way to bring in sufficient revenue to support their business. And so far, they have had only limited success selling ads. Some have shouldered the cost of fielding a sales force to reach mom-and-pop businesses that may know nothing about online advertising.

One problem is that the number of readers for each neighborhood-focused news page is inherently small. “When you slice further and further down, you get smaller and smaller audiences,” said Greg Sterling, an analyst who has followed the hyperlocal market for a decade. “Advertisers want that kind of targeting, but they also want to reach more people, so there’s a paradox.”

Still, said Peter Krasilovsky, a program director at the Kelsey Group, which studies local media, many small businesses have never advertised outside the local Yellow Pages and are an untapped online ad market whose worth his firm expects to double to $32 billion by 2013.

One of the most ambitious hyperlocal sites is EveryBlock, a six-person start-up in an office building in Chicago overlooking noisy El tracks, which is stitching together this hyperlocal future one city at a time. Backed by a $1.1 million grant from the Knight Foundation, it has created sites for 11 American cities, including New York, Seattle, Chicago and San Francisco.

It fills those sites with links to news articles and posts from local bloggers, along with data feeds from city governments, with crime reports, restaurant inspections, and notices of road construction and film shoots. (The New York Times has a partnership with EveryBlock to help New York City readers find news about their elected officials.)

One day last week, the EveryBlock page for Adrian Holovaty, the company’s founder, showed that the police had answered a domestic battery call two blocks from his home and that a gourmet sandwich shop four blocks away had failed a city health inspection.

“We have a very liberal definition of what is news. We think it’s something that happens in your neighborhood,” said Mr. Holovaty, 28, who worked at The Washington Post before creating EveryBlock two years ago.

In some ways the environment is right for these start-ups. In the last several years, neighborhood blogs have sprouted across the country, providing the sites with free, ready-made content they can link to. And new tools, like advanced search techniques and cellphones with GPS capability, help the sites figure out which articles to show to which readers in which neighborhoods.

Unlike most hyperlocal start-ups, Patch, based in New York, hires reporters. It was conceived of and bankrolled by Tim Armstrong, the new chief of AOL, after he found a dearth of information online about Riverside, Conn., where he lives. Patch has created sites for three towns in New Jersey and plans to be in dozens by the end of the year.

One journalist in each town travels to school board meetings and coffee shops with a laptop and camera. Patch also solicits content from readers, pulls in articles from other sites and augments it all with event listings, volunteer opportunities, business directories and lists of local information like recycling laws.

“We believe there’s currently a void in the amount, quality and access to information at the community level, a function, unfortunately, of all the major metros suffering and pulling back daily coverage of a lot of communities,” said Jon Brod, co-founder and chief executive of Patch. This month, the home page of The Star-Ledger’s Web site, based in Newark, twice referred to articles first reported by Patch.

Outside.in publishes no original content. The company gathers articles and blog posts and scans them for geographical cues like the name of a restaurant or indicative words like “at” or “near.” An iPhone application lets users read articles about events within a thousand of feet of where they are standing. Outside.in, which is based in Brooklyn, licenses feeds of links to big news sites that want to deepen their local coverage, like that of NBC’s Chicago affiliate.

Venture capital firms have invested $7.5 million in the company, partly on the bet that it can cut deals with newspapers to have their sales forces sell neighborhood-focused ads for print and the Web.

One hurdle is the need for reliable, quality content. The information on many of these sites can still appear woefully incomplete. Crime reports on EveryBlock, for example, are short on details of what happened. Links to professionally written news articles on Outside.in are mixed with trivial and sometimes irrelevant blog posts.

That raises the question of what these hyperlocal sites will do if newspapers, a main source of credible information, go out of business. “They rely on pulling data from other sources, so they really can’t function if news organizations disappear,” said Steve Outing, who writes about online media for Editor & Publisher Online.

But many hyperlocal entrepreneurs say they are counting on a proliferation of blogs and small local journalism start-ups to keep providing content.

“In many cities, the local blog scene is so rich and deep that even if a newspaper goes away, there would be still be plenty of stuff for us to publish,” said Mr. Holovaty of EveryBlock.

People's Work need to be watched by Software

By DAMON DARLIN

Published: April 11, 2009

PEOPLE need to be watched.

Back at the dawn of the Industrial Revolution, Jeremy Bentham, the English philosopher, seized on that basic management precept to design a building that would become a touchstone for architects of a new age. Calling it the Panopticon, he arrayed prison cells in a semicircle. The innovative layout gave a smaller number of guards the ability to watch a greater number of prisoners.

In other words, it cut costs.

The Panopticon design is still in use today, and not just in prisons around the world. It was easily adapted for factories and offices.

But what happens in the information age, when workers are no longer there in front of the manager, but working from home — maybe in their pajamas, or maybe with a cat on their lap and a peppy Lily Allen tune playing on the iPod? In many managers’ eyes, they wouldn’t do as much work.

No worries. Software becomes the new Panopticon. It can monitor workers who, conveniently, do most of their work on computers. It can also measure their efforts and direct work to those who do it best.

LiveOps, a rapidly growing company in Santa Clara, Calif., that operates virtual call centers — agents working from home across the country — has also found that software can perform other management tasks. How it uses that software points to the direction in which technology is taking the workplace.

Founded in 2000, LiveOps fields some 20,000 “home agents,” all independent contractors who take orders for products advertised on late-night TV, sell insurance or transcribe recordings for other companies. The agents even take pizza orders. If there is a storm in a particular city and pizza orders surge because no one is going out, calls to the pizza store are routed to LiveOps agents thousands of miles away. (The delivery boy still has to brave the rain and the wind. Software hasn’t solved that problem.)

The virtual call center is nothing new. A number of companies, like Elance, oDesk and Guru, assemble freelance work forces to take on specific tasks so that companies don’t have to run call centers or hire additional employees. TopCoder and RentACoder have done it specifically for computer programmers. A start-up, Serebra Connect, hires college students in developing economies to do work.

But Maynard Webb, the chief executive of LiveOps, says he thinks that the company’s software gives clients like Kodak, Colonial Penn and TristarProductions, a direct marketing company, an advantage. The software moves a company beyond simple cost-cutting. Mr. Webb says greater efficiencies can be found because the company’s software measures the results from each agent according to criteria determined by the client.

If a client wants agents to persuade callers to buy additional products, the software tracks that — and then directs calls to the agents who do it best. Those agents prosper.

What about the agents who aren’t so good? “No one gets fired,” Mr. Webb said. “They just don’t get work.”

Software becomes a passive-aggressive manager.

He thinks the concept can be expanded to any line of work — like health care, retailing, publishing and law — where the output can be measured.

And the advantage for LiveOps, which Mr. Webb says has been profitable since 2006, is a harbinger of things to come. “The economics are better. No buildings. No benefits,” said Mr. Webb, a former eBay executive. (LiveOps’s 300 employees do get benefits.)

Before everyone wrings their hands at the horror of an economy shifting to workers paid by the minute doing piecemeal work at the kitchen table while monitored by an all-seeing computer, consider that Mr. Webb isn’t having trouble finding workers.

“There are way more people who want to work in this model than we have room for,” he said.

He says that the company accepts only about 2 percent of all applicants, and that his contract work force has an average age and education level higher than at call centers. And attrition, a major problem in the call center industry, is lower, less than 10 percent after the first 300 calls.

Mr. Webb says it’s because his work force is happier. Dawn Linseman, a LiveOps sales specialist in Madison, N.C., says she checks the LiveOps internal Web site every day for statistics on how well she meets the clients’ criteria. “If you keep your stats up, your calls are back to back,” she says.

She started in 2004 and handles mostly infomercial orders from a spare bedroom she converted into an office. She schedules her work around the needs of her family, grossing about $18,000 a year working about 24 hours a week.

“As soon as my son gets his driver’s license, I’ll be working full time,” she says.

Yes, she wishes she had the benefit of company-provided health insurance, which she doesn’t get as a independent contractor. A plan offered by her husband’s employer covers the family. But she says she is much happier than she was when was an accounting manager for a Michigan supermarket chain. “I don’t miss the office politics,” she said.

Indeed, she recruited her sister, who does a lot of work transcribing medical reports.

Mr. Webb says the best workers can bring in about $50,000 a year. “If they get really good, I hire them as managers,” he said.

Software, always on and always watching, remains the real middle manager.

Google money machine defies common sense, Advertisers shrink, Ads expand

By Cade Metz in San Francisco

Posted in Business, 9th April 2009 21:02 GMT

As the economy continues to shrink, Google continues to crank the dial (http://www.theregister.co.uk/2009/01/12/how_the_google_stole_christmas/) on its top-secret money machine (http://www.theregister.co.uk/2008/09/02/changes_for_adwords/).

According to the latest stats from AdGooroo - a search marketing consultant that tracks search ads from a network of servers across the globe - Google expanded its ad coverage (yet again) during the first three months of the year, despite a decrease in the overall number of advertisers using its AdWords platform.

"An increase in the number of ads coinciding with a decrease in the number of advertisers suggests an artificial change in ad coverage, perhaps in response to sluggish activity, quite different from than the organic growth which fueled revenues in previous quarters," reads a preliminary draft of AdGooRoo's quarterly report, due for release on Monday.

Google's official line (http://www.theregister.co.uk/2008/10/16/google_q3_earnings/) is that by expanding coverage, it's somehow improving the "quality" of the text ads that turn up when you type certain keywords into its search engine. But the Mountain View Chocolate Factory said the same thing last year when it was actively shrinking coverage (http://www.theregister.co.uk/2008/03/18/when_google_does_evil/).

During the first quarter - a traditionally slow quarter for online advertising - the average number of ads per Google keyword reached a high of 5.25 in February, up from 4.39 in the shopping-happy month of December. Meanwhile, the number of first-results-page advertisers dropped 1.3 per cent during the quarter.

Typically, AdGooRoo says, an increase in ad coverage results in more revenue: More ads means more clicks, and more clicks means more dollars. But considering the decrease in the number of advertisers, the outfit questions whether this will still hold true.

Potentially, there could be cases where expanded ad coverage does not grow revenue. If Google posts more ads with lower per-click prices, for instance, this could shrink the bottom line by reducing the numbers of clicks on ads with higher prices. But in the end, Google controls AdWords prices - though it says otherwise. Advertisers do set the maximum price they wish to pay, but Google's top-secret algorithms, in tandem with what others are advertisers are bidding, determine how much it actually charges for a particular ad. Thanks to Google's "quality score," ads at the bottom of the page may have higher prices than those at the top.

Google's ad coverage is limited by the keywords advertisers are bidding and their daily ad budgets. But because Google controls such a large swath of the search market - more than 60 per cent in the US, according to comScore - advertisers are generally willing to pay for as much traffic as they can get.

"Our experience is advertisers are willing to take all the clicks we can give them at the current CPC [cost per click] - even in tough times," Google senior vice president Jonathan "Perfect Ad (http://www.theregister.co.uk/2008/09/02/changes_for_adwords/)" Rosenberg said during the company's fall earnings call. "We think that will continue to be true because nobody wants to turn away a customer."

AdGooroo founder Rich Stokes argues that click-for-click, Yahoo! and Microsoft are generating better leads than Google. But advertisers are still more likely to opt for Mountain View.

"There's some pretty good ROI to be found on Yahoo!, much better than Google. But the volume is so much higher on Google," he tells us. "It takes just as much effort to manage a Yahoo! or Microsoft campaign as a Google campaign, so advertisers - many of whom are shorthanded - are going to choose Google."

Anytime Google wants to expand coverage, it can do so. Certainly, the company is concerned with so-called ad quality. But when it wants the extra cash, it can always hedge that commitment (http://www.theregister.co.uk/2008/03/18/when_google_does_evil/) in the short term.

The question is whether this latest coverage-leap will boost the bottom line.

Earlier this year, CEO Eric Schmidt admitted that even Google is "not immune" to recession. "The situation is pretty dire," he said (http://www.theregister.co.uk/2009/03/04/schmidt_on_netbooks/) last month at a San Francisco analysts' conference, referring to the global economy. "During this time, what's happening is that people are using the internet more. But it obviously will affect the online-advertising markets as well - simply because our systems are so tightly tuned that if customers are buying less it will eventually be reflected in [cost per advertising click]...

"We are not immune - 'we' Google and 'we' the online-advertising industry. But we may be better positioned than other advertisers."

Pay no attention to the "finely tuned" bit. AdWords isn't anywhere near as finely tuned as Google would lead you to believe (http://www.theregister.co.uk/2008/11/26/google_ads_and_adobe/). And in all likelihood, you can ignore the "not immune" bit too. Schmidt likes to downplay the power of the money machine.

Google announces its first-quarter earnings next week. ®
Related stories

* Google flaunts Meltdown-proofiness (22 January 2009)

http://www.theregister.co.uk/2009/01/22/google_q4_earnings/
* Google AdWords: 11 herbs and spices revealed (21 January 2009)

http://www.theregister.co.uk/2009/01/21/google_secret/
* Google - your source for FREE Adobe gear (26 November 2008)

http://www.theregister.co.uk/2008/11/26/google_ads_and_adobe/
* Google - the world's first firewalled monopoly (20 November 2008)

http://www.theregister.co.uk/2008/11/20/the_google_monopoly/
* Google: 'We are Meltdown proof' (16 October 2008)

http://www.theregister.co.uk/2008/10/16/google_q3_earnings/
* Google remodels top secret money machine (2 September 2008)

http://www.theregister.co.uk/2008/09/02/changes_for_adwords/
* Screwgle™ - Google's new ad revenue model (28 July 2008)

http://www.theregister.co.uk/2008/07/28/google_expands_automatic_matching/
* Eye of newt: Inside Google's AdWords auction (24 July 2008)

http://www.theregister.co.uk/2008/07/24/the_google_auction/
* Google's riches rely on ads, algorithms, and worldwide confusion (18 March 2008)

http://www.theregister.co.uk/2008/03/18/when_google_does_evil/

A Long Price Struggle between Microsoft vs Linux

Giampolo, how low will you go?

By Gavin Clarke in San Francisco

Linux FCS Microsoft has made a tactical mistake in deciding to compete with Apple on price in its latest, much debated, Laptop Hunters TV ads.

Until recently, Microsoft was pushing hard on the "value" of Windows. Now, though, the Laptop Hunters ads have turned the spotlight on the consistently high and - and recession proof - price tag of Apple's Macs. Its latest ad, featuring a guy called Giampolo, even dismisses Macs as putting the sexy before the computing power.

That switch of focus in the fight with Apple will rebound in its battle against Linux, because Linux is cheaper than Windows for users and OEMs serving them, according to Linux Foundation executive director Jim Zemlin.

"Value" has been a major plank in Microsoft's long campaign against Linux, which has tried to reposition the free nature of Linux code as a burden.

Zemlin, speaking at the Linux Collaboration Summit in San Francisco, California, juxtapositioned the $1,500 price of Giampolo's HP HDX laptop with what he could have walked away with instead, had he gone for Linux. Shopping around, Giampolo could have got: an HP Mini 1000 notebook with Atom processor, G1 Google phone, a 42-inch plasma-screen TV, Neuros DVR and still have given back to the planet by donating a One Lap Top Per Child PC. All, of course, running Linux.

"We are starting to see a major competitor compete on price," Zemlin said. "The thing is, if you are going to compete on price that's going to be a tough competition."

As Zemlin pointed out after his keynote, Microsoft's problem is in the licensing of Windows which automatically makes it more expensive than Linux for use on many consumer devices. That busts the margins of OEMS like Motorola - a Linux user - and impacts the price they pass on to people like Giampolo.

"What can Microsoft do apart from reduce its price to zero?" Zemlin asked.

"They are going to have to leverage what ever advantage they can to compete with Apple, and price is one thing in its competition against Linux where Microsoft is doomed to failure."

According to Zemlin, price is just one link in a chain that Linux can use to beat Windows adoption. The fact companies like Motorola can also modify code and use their own branding will also help.

"Price matters, access to the code matters, and custom branding matters and allows Linux to change entire assumptions about the market place," he said. "It's a fundamental advantage over the competition who wants to compete in the same old world of price and feature sets. We are changing the entire model of computing."

Financial Trouble: Quo Vadis Facebook?

Mar. 27, 2009

By Axel Schultze, Social Media Academy

The social networking company is looking for money – lots of money. How many do they really need and what then?

2007 estimated headcount 450

2008 estimated headcount 800
2008 estimated cash flow negative $150MM
Above numbers reported by TechCrunch

2009 estimated headcount 1,200
That translates to a cost structure of roughly $200,000,000 (200MM)
With revenues (I don’t see more than 100MM) this is $100MM under.
Now add the enormous cost of data centers that need to stream the videos, the photos and the rest of the application.

The clock is ticking. So what options has Facebook?
1) Cut Cost / Layoff
Either cut staff in half to get to break even
That’s possible but hard to do. But better saving 50% than losing all.
It would also mean the company is getting profitable and may do an IPO in a year or two.
2) Double revenue
But with advertising? That’s so much harder when even advertising machine Google admits that ad revenue is flat – meaning it’s probably going down. After all, the world is beginning to realize that the advertising model is not a business model after all.
3) Additional Funding
Get $500 Million to survive 5 more years, freeze hiring and use the time to develop a product/service value based business model – probably the hardest but still possible. In MHO the only way to keep current investors happy. Remember Jack Walsh: "Shareholder value is the dumbest thing in the world:"
4) Sell
OK then there is the option to sell the whole package - better now than never. Maybe for a billion or two - again remember Jack Welsh.

Then there is competition (possible acquirer):
1) Google with $16B cash in the bank has some nice little wiggle room
2) Less aggressive but more stable LinkedIn could weak up (I know hard to believe) and with just a few smart tactical moves get really dangerous.
3) MySpace – don’t underestimate those guys. They are less strategic more like a news paper driven network – but they have 3 things: a) Huge momentum, b) Financial backing c) the option to break into business (they are just a bid sleepy in that regard)
4) Microsoft? Not really. No vision, totally a-social DNA, no momentum… just money and then we could list any other company with money.
5) The SAP / Oracle world. Hmm interesting. Unlike Microsoft, they haven’t burned their name in social media yet. Just two massive companies but may become an interesting contender in the game in the next two years.

Disclosure: The above numbers are just rough estimates.
But you get the idea

Australia's $31 Billion NBN: Smart Politics, but who is going to pay?

Apr 08, 2009
By Robert Clark
telecomasia.net

The Australian government upended 20 years of private sector-driven policy yesterday by declaring it will lead the construction of a A$43 billion ($31 billion) national fiber broadband network.

The new version of the NBN, intended to deliver fiber to 90% of Australia’s homes, requires ten times more public funding than that promised by Prime Minister Kevin Rudd on the election trail 18 months ago.

The sheer scale of the project has dramatically reshaped the troubled politics of the project. Whether the economics stack up is a different question.

Under the plan, the government will take 51% control of the new company. It is hoping that Telstra, Optus and infrastructure firms will take up the remainder.

Rudd explained his decision to take the wheel because none of the private sector bids – from SingTel-owned Optus, the Macquarie-backed Acacia and smaller local players – was acceptable. A “market failure” due to the recession, he said.

In reality the biggest failure was of the tender process itself. Having excluded Telstra because of its scant and non-compliant bid, the government was left with bit players.

Wiring Australia, with just 21 million people in a country the size of continental United States, requires the deepest of deep pockets.

After 12 years of full deregulation, Telstra is still the market’s 800-pound gorilla. This network was never going to be built without Telstra’s participation. And still won’t.

The clever politics of the Rudd decision is that it allows Telstra a way to buy its way. With the imminent departure of Sol Trujillo, the way is also opened up for a fresh start in relations between the government and the incumbent.

Telstra cautiously welcomed the plan. “We will work with the Government to assist with the implementation of its strategy,” said chairman Donald McGauchie in a statement.

Telstra investors were cheered, too, ticking up the share price by 16 cents to A$3.37 by late morning Wednesday.

But underneath the smart footwork and the stirring talk of nation-building is the massive chit at a time when public finances are already hard-pressed.

The government will start selling “Aussie infrastructure bonds” later this year, backed by a public marketing campaign – the first such promotion in two decades.

That’s telling. And that’s just the start.