by Dana Blankenhorn
Volume VI, No. XVII
For the Week of April 29, 2002

This Week's Clue: My Mistakes

I hate pundits who don't acknowledge their past mistakes. When my predictions turn out wrong it's really up to me, not you, to point them out. So in my new e-book, "Boom, Bust & Beyond: The Best of Dana Blankenhorn" I've got an entire chapter filled with false predictions I published here, where I was either ridiculously early, or just plain wrong.

I think a good columnist should apply the same honesty to their life. For most this is unnecessary. They get the gig from their employer (or a syndicate created by the employer) and so long as they keep that one sponsor happy they're free to cash regular paychecks.

I, however, am a freelance. This means I'm in bidness. I don't really want to be in bidness, even though I cover bidness. I'd rather be writing about bidness than working on billing, or marketing, but that's the reality of it.

And that's my first mistake. I've spent far too much time these last few years working in my business rather than on my business. I've always believed that my work is my best advertisement, but for the last five years it's been my only advertisement.

To my credit, I anticipated the current Internet Bust. I was looking for it back in 1997. And it's true that the depth of the downturn should have shaken me more than some others because it has been concentrated on the two sectors - e-commerce and telecommunications - where I spend most of my time.

But in the last few months some friends have reported new growth. They've gotten columns, even book deals, while my phone hasn't rung since the New Millenium started (literally). This has caused me some useful soul-searching. The physician is trying to heal himself. (If I commit malpractice, I think, maybe I can sue myself, and live off a fat settlement against myself.)

What Clues did I miss?

If you don't use a list of Clues like this, all you're doing is wallowing in self-pity. They need to become an action plan. So here's one:

This has always been an interactive column. I love your e-mail suggestions, and I welcome your input to I-Strategy, which recently passed its 18-month anniversary. So feel free to pound me on what I've written here, and if your own business isn't what you want it to be, conduct this exercise yourself. Ask yourself, honestly, what you think you're doing wrong, and set in motion a plan to do it right. You have nothing to lose but your under-employment.

SSP (Shameless Self-Promotion)

You can show how Clued-in you are by downloading the animated .gif file on the upper-left side of our home page , and copying it onto your own Web site. It shows you want your business partners to get a Clue too. (Clicking directly on the graphic leads to our subscription page.)

Want a really good read? You'll find it in "Boom, Bust & Beyond: The Best of Dana Blankenhorn," now available for purchase at DanaBlankenhorn.Com.. You can also order my novel, "The Time Mirror," at the same location.

I still write for Boardwatch and BtoB, but if you need some writing, editing, or consulting help don't hesitate to call on me

The Print on Demand version of "Living on the Internet" is also available for purchase at BookSurge.Com, for $29.99. And you can get the PDF version for just $7.99 (such a deal). The March update to the book is coming, and it's easy to get on the list via e-mail.

Remember that it's journalism that keeps the Clues coming...

Shameless Promotion

A list is only worth the permission it's based upon. Auditing and aging your list are the only ways to know you really have permission to pitch - the first step on the road to getting them to sign on the line which is dotted. That signature is your bottom line. Everything else is just cost.

Take the first step toward making your lists truly valuable with help from my friends at Whitehat Interactive - click here to begin. They've got a Clue.

Takes on the News

Moore on Why Telecomm is Falling

The reason big telecomm companies like Qwest and Worldcom are sliding toward bankruptcy is really very simple. It's Moore's Law.

No 30-year depreciation schedule can survive against Moore's Law. With the capacity of fiber lines constantly increasing, with the capability of radio constantly improving, the price to move a bit continually slides toward zero. The only way to keep up is to increase speed in line with Moore's Law, and to re-orient your economics in conjunction with it.

Look at the chip-making industry. These boys replace their equipment nearly every year, despite the hundreds of millions it costs. That's why Applied Materials split its stock again recently, even while chip-makers like Intel continued going sideways. You don't take out 10-year loans on one-year plans.

How can the telecomm sector create an economic environment based on Moore's Law rather than depreciation? The good news here is that Wintel (Microsoft and Intel) are on the case. The best news is they're not working in harness.

Microsoft's game is always to dial-down capabilities so it can provide cheap upgrades on its schedule. Putting a crippled Wi-Fi system into Windows allows it to control this upgrade cycle, if consumers follow along. Consumers will find wireless networking built-into future copies of Windows, and if they use it they're tied, not just to Microsoft's system, but to Microsoft's decisions on upgrades.

Intel's proposal is more straightforward. It's selling programmable (read upgradeable) chips to telecommunications firms and it's pushing the next version of Wi-Fi - 802.11a at 5 GHz - rather than the current 2.4 GHz 802.11b standard. Putting "a radio in every chip" is very Clued-in. It puts the power of Moore's Law squarely behind wireless, and encourages chip upgrades.

Notice one more thing. The aims of Microsoft and Intel here are different, with Microsoft trying to lock-in customers and slow progress, while Intel tries to push the upgrade cycle ahead. Intel doesn't care whether Microsoft supplies the software for future radio-based chips, so long as you buy them.

The result is there is now tremendous opportunity in the telecommunications space if (and this is a big if) you can build an economic model that takes advantage of Moore's Law (allowing for regular upgrades of speed and capability) with a new company not tied to depreciation in any way. Someone will buy Worldcom and make money on it, but it will be out of bankruptcy, after even the bondholders get a Marine-style "hair cut."  The value of Worldcom's assets will be between one-to-three years' revenue, and no more than that.

Google's Fight (Put Me In, Coach)

There are days when I wish, more than anything else, that I worked for Google.

A job description would be hard for me to come by. I don't do PR, and they don't need columnists. For starters, though, I know I could produce some fine white papers. They need some short, well-written punchy white papers (like this), stuff that reporters would find accessible and engineers would find acceptable.

God knows they've got the topics. There's their new API  - whoever heard of a search engine publishing such a thing? That deserves a professional explanation. There's its policy on spamdexing  - define it and explain what you're doing in broad strokes (because enforcing it takes a Seurat). The same thing should be done (in conjunction with lawyers) regarding Google's stands on such things as Overture's patent-infringement suit, its response to the DMCA, and the decision in Kelly vs. Arriba Soft.

These white papers could be used by a variety of departments within the company, and freely distributed to the media (or other interested parties). The exercise would also help the company clarify its positions on various subjects, and make sure everyone is on the same page while eliminating stonewalling.

Hey, give me a call.

Keep Business From Evil

Ever since the 1930s philosophers and political scientists (mainly on the left) have identified links between fascism and big business.

When possessed of an excess of zeal small business lobbies push for something approaching anarchy, an Ayn Rand world with no law, and no responsibility, in which the right masters will magically appear because they'll win the capitalist game. When possessed of the same excessive zeal, meanwhile, big businesses push toward fascism, in which the market's social mobility is stifled (along with thought) in the name of maintaining the status quo.

Both these excesses are pure nonsense. There is no perfection, because everyone's definition is different and few can be accommodated. Constant, active contention is the closest man has come, a maximum of liberty, democracy and capitalism held in a constantly-shifting balance through a system of checks and balances, restricting all power and giving people constant opportunities to change their minds.

Right now, it's the big business conservatives - especially in the media space -- who seem to have the bit in their teeth. They're threatened by change, they fear the market, and they want a government powerful enough to maintain present economic arrangements forever.

How can they do it? By controlling the flow of ideas so only those appealing to the "establishment" will be heard, as FCC chairman Michael Powell wants to do. By putting the criminal law (and its penalties) behind present economic arrangements on content. By allowing business innovation only by "members of the club," and then only under carefully-controlled conditions. And by making sure everyone condemns fair use as piracy, even those who are supposedly "anti-establishment".

What can stand against such a scheme? Well, business can. By allying itself with just one set of business lobbies - music companies and movie companies (how ironic) -- the Bush people are ignoring technology industries which are much more in-touch with the market. Technology companies have finally started bringing consumer concerns into the room but until consumer concerns are truly dealt with the market won't move forward.

Despite all the evil that business and government can do, separately or together, remember always that you hold the ultimate power. You control the horizontal, you control the vertical. You control your wallet, you control your mind, you control your ballot. Don't let the powerful forget that. Use your power every day, and eventually the strong will be forced to knuckle-under.

Clued-in, Clueless

Clued-in (from a marketing perspective) is Echostar's ditching of Starband in favor of an alliance with phone company SBC. Its direct broadband play will be DirecPc (after their merger), so why not sell DSL and satellite together against cable? (The failure of StarBand also demonstrates the strength of 802.11 in rural areas, by the way.)

Clueless is Bruce Sunstein, an intellectual property law attorney, who claims that users can be legally-enjoined from linking to an inside page of a Web site, and forced instead to waste time at the front door. Victory by this idiot in any court would render the whole idea of the Web meaningless, and there are already too-many sites following this advice, framing inside pages and playing other control games to keep people from getting to the information they need. If you don't want people linking to something put it behind a firewall.

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