Daily Archives: September 21, 2009

Openness is the key

Posted on by

It’s nice to be cited. Today, in a speech to the FCC on “Preserving a Free and Open Internet: A Platform for Innovation, Opportunity, and Prosperity”, Julius Genachowski, the Chairman of the Brookings Institution, said this:

Why has the Internet proved to be such a powerful engine for creativity, innovation, and economic growth? A big part of the answer traces back to one key decision by the Internet’s original architects: to make the Internet an open system.

Historian John Naughton describes the Internet as an attempt to answer the following question: How do you design a network that is “future proof” — that can support the applications that today’s inventors have not yet dreamed of? The solution was to devise a network of networks that would not be biased in favor of any particular application. The Internet’s creators didn’t want the network architecture — or any single entity — to pick winners and losers. Because it might pick the wrong ones. Instead, the Internet’s open architecture pushes decision-making and intelligence to the edge of the network — to end users, to the cloud, to businesses of every size and in every sector of the economy, to creators and speakers across the country and around the globe. In the words of Tim Berners-Lee, the Internet is a “blank canvas” — allowing anyone to contribute and to innovate without permission…

It’s an excellent speech. Worth reading in full.

Keynes redux

Posted on by

I’ve been reading Robert Skidelsky’s new book on Keynes, which is absorbing and well-written. I never accepted (as most of the neo-con economists did) that Keynes had been overtaken by history, as it were and Skidelsky backs that up by picking out three Big Ideas from Keynes which, he thinks, have an enduring resonance. They are:

1. The future is unknowable, so economic storms, especially those originating in the financial system, are not just external shocks which impinge on smoothly operating markets, but part of the normal working of the market system. (This is something an engineer would know intuitively, so it’s always been a source of amazement to me that economists and investors seem unaware of it. Market capitalism is an intrinsically unstable system.)

2. Economies wounded by these ‘shocks’ can, if left to themselves, stay in a depressed condition for a long time. (As the Japanese know to their cost.)

3. A moral critique of societies which worship the pursuit of money and efficiency above all other objects of human striving. I thought of this while passing the Cambridge Arts Theatre, which Keynes was instrumental in founding. In a way, it’s the most profound of his ideas, and the one most flagrantly ignored in the last two or three decades.

Skidelsky has a lovely Coda in his Preface in which he writes:

“Once I started writing this book, on 1 January 2009, I stopped reading the newspapers on a daily basis to avoid filling up my mind with ‘noise’. Any coherence my argument may have stems from this act of self-denial.”

No wonder I am sometimes incoherent. I read too many papers.

Amazon close to achieving Bezos’s dream?

Posted on by

I’ve always believed that the business Jeff Bezos wanted emulate was Wal-Mart. He started with books simply because they were objects that people will buy without having to handle them. But in recent years I’ve bought an increasing number of non-book items from the UK store. Today, the NYT is claiming that Amazon is closer to realising the Bezos dream than many of us realised.

Fifteen years after Jeffrey P. Bezos founded the company as an online bookstore, Amazon is set to cross a significant threshold. Sometime later this year, if current trends continue, worldwide sales of media products — the books, movies and music that Amazon started with — will be surpassed for the first time by sales of other merchandise on the site. (That transition already occurred this year in its North American business.)

In other words, in an increasingly digital age, Amazon is quickly becoming the world’s general store. Alongside the books and CDs and DVDs are diapers, Legos and power drills, not to mention replacement car clutches and more arcane items like the Jackalope Buck taxidermy mount ($69.97).

“Amazon has gone from ‘that bookstore’ in people’s mind to a general online retailer, and that is a great place to be,” said Scot Wingo, chief executive of ChannelAdvisor, an eBay-backed company that helps stores like Wal-Mart and J.C. Penney sell online. Mr. Wingo envisions e-commerce growing to 15 percent of overall retail in the next decade from around 7 percent. “If Amazon grows their market share throughout that period, and honestly I don’t see anything stopping it, that is pretty scary,” he said…

And that’s ignoring the whole new S3 cloud-computing business that Amazon launched a while back and which now seems to be powering every major Web 2.0 service. In a way, Amazon is a more astonishing company than Google, because it has to deal directly with the public all the time. And it’s very good at what it does.