by Dana Blankenhorn
  Volume VII, No. XXXI

This Week's Clue: Libertarian Conservative

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This Week's Clue: Libertarian Conservative
SSP (Shameless Self Promotion)
SP (Shameless Promotion)
Pushing Deep Thoughts
The Role of Paid Content
Voice Remains A Key Always On Technology
Clued-in, Clueless

Dana Recommends The Blankenhorn Effect offers a powerful, positive message for our time. Once you understand how Moore's Law impacts every part of your life, how powerful it is, and how irresistible a force it truly is, you will have the power to predict the future and know how to change it. Buy it today, and make 2003 a better year for yourself, your business, and your family.


For the Week of August 4, 2003

My first political experience was on the right.

In the early 1970s I was an official with Young Americans for Freedom and hung out with (among others) Richard Delgaudio. Richie liked 16-year old girls. He still does, apparently, but when you're 50 there's another name for that.

We were "libertarian" conservatives. We wanted less government, a government that wouldn't nitpick business and would stay out of our bedrooms. It really was freedom we were after, not just another word for nothing left to lose.

Later, I changed. I met women for whom the lack of choice would mean a life of slavery. I met gays who couldn't help what was in their hearts. I met an Aggie who enjoyed green smoke but otherwise was a nice guy. I had a Tamil friend who, despite the fact he was Caucasian, was due to his skin tone called a "nigger."

But conservatives changed, too. Once in power they had a whole list of people they wanted to throw in jail, sometimes for life, and otherwise make examples of. (Some of these people were personal friends. Sometimes these people included me.) They abandoned the idea of a "small government" in favor of one that endorsed their interests at home and abroad. And they got rich, very rich. They became bag men for their wealthy clients. They became bullies, even fascists .

Many ideas I considered basic to conservatism - like balanced budgets and privacy - were abandoned by those who claimed the mantle of conservatism. They were taken up, curiously, by those previously called liberal Democrats. Certainly not by all - not by unions, not by financial interests - but by plenty of Democrats who, in the 1990s, found themselves in power, in state houses and the White House.

I still consider myself a libertarian. In many ways I still consider myself conservative - conservative in how I live, in how I handle money, and in how I treat my kids. But I have been voting Democratic for some time, and today write often on behalf of Howard Dean .

All this is preamble, by the way, to a discussion of technology and with Internet commerce. Because it turns out, unfortunately, that many issues dogging the Internet economy require political solutions.

Many of these solutions could come from the use of a President's bully pulpit. The copyright wars would end if the President demanded that music and movie companies seek a market solution. The World of Always On would blossom if the President would support strong privacy laws, and state clearly that any business which didn't recognize peoples' data belongs to them will see its CEO behind bars. We need clear direction for bio-science to really push ahead.

Mainly we need to understand that patent and copyright laws are not absolute, that they exist to encourage people to make more and go forward, and that when these laws become an enemy of progress they must be altered. We need, simply, balance.

This is the rhetoric of such people as David Weinberger, David Reed, Bob Frankston and the other folks at Greaterdemocracy , a blogging forum formed after the 2002 debacle which is now moving into the Dean camp.

Their message is this. The only way for America to succeed is to keep climbing the value chain. When progress slows down, as it did in the late 1980s, and as it is doing today, our competitors catch up quickly. In the late 1980s it was Japan that was kicking our butt. Today it's India and China. Old standards, easily copied, are quickly co-opted. Change is our chief ally. Rapid change allowed America to raise its share of global economic activity throughout the 1990s - from roughly 20% to roughly 30%. And that share is now heading downward.

It is our slower pace of technological progress, hamstrung by government working for entrenched industries, that most puts our future at risk. As a result the Bush tax cuts, sold as domestic stimulus, are rapidly turning into foreign aid - even IBM is exporting jobs to India.

It's true that there are many Democrats who are slaves to the money power. (Even Michael Jackson is aghast at this and when Jacko calls you strange it's truly time to look in the mirror.) But I also remember that, when I started in politics, Nixon's liberalism was quite pronounced. (He launched the EPA, the CPSC, and OSHA. He instituted wage-price controls and appointed Harry Blackmun to the Supreme Court.) In other words, you can't let perfection become the enemy of the good.

What we have now is not working for tech, and it's not working for the rich, either - who need profits more than they need tax cuts. It will not work for tech, because it is not driven by the needs of tech. Without tech America is Argentina, only with more gun crime. That's a message we still have to get through to Howard Dean, but I believe it's a message he will listen to.

What tech needs is freedom to innovate, the human capital to innovate with, and the financial right to fail. Tech needs liberty, a democracy that adjusts to changing conditions, and transparency in financial markets. Tech doesn't just make its makers rich, it makes us all rich. But right now it's mainly making Indians and Chinese rich.

A Howard Dean Administration will change that. And if I'm wrong, we'll dump him. The key is in his own rhetoric - you have the power. Let's take that power, hold Dean's feat to the fire, and get the tech economy moving again.


SSP (Shameless Self-Promotion)

I have started work as a business analyst with Progressive Strategies , a New York research firm that has the ear of the world's top technology companies. If we can get some of 'em to actually follow some Clues, it would be a very good thing indeed.

We have a winner. "The Blankenhorn Effect" has won the Computer/Internet category in the 2003 Independent Publisher (IPPY) awards . The book was also reviewed (favorably) by Ray Troxel of The Web Server Times last week.

"Dana, it is GOOD," raves Pete duPont, lawyer, futurist and once a candidate for President. "This is some really powerful 'stuff.' I think you've got a winner," says Drew Kaplan of DAK Catalog fame. One result is I have begun working on a follow-up book, describing the future direction of technology, to be called "The World Of Always On." Buy "The Blankenhorn Effect" at Amazon.Com , or at least say nice things. You can use the ASIN number, 1553953673, and recommend it to readers of other, similar books. You can also save on shipping when you buy the book at Amazon, over the cost of buying it elsewhere.

If you can convince some more published reviewers to read "The Blankenhorn Effect" and recommend it to their readers, please send me a name and address. In exchange, you'll get the PDF version of my second book, The Blankenhorn Effect: Boom, Bust & Beyond. This is a collection of columns from, organized chronologically and by subject, with additional commentary from yours truly.

You have my permission to forward this newsletter widely. And if you have trouble subscribing let me know . Remember: it's journalism that keeps the Clues coming...


Shameless Promotion

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If you're serious about Internet Commerce, you need Whitehat Interactive . Get it today.


Takes on the News

Pushing Deep Thoughts

Here is a business proposal for you.

It's a think tank that will take stuff that bubbles-up from the Internet and push it, in New York and Washington, so the vision can influence reality.

It would have many characteristics in common with current market and political research outfits, from Progressive Strategies on the business side to the Heritage Foundation or Progressive Policy Institute on the political. (Any of those outfits could easily launch this as an intrapreneurial effort if they were so inclined, but something tells me they aren't.)

What brings this to mind is a great paper from Doc Searls in the latest LinuxJournal . Called "Saving The Net," it is an overview for policymakers of the political, social, and economic implications of our current money-driven policy of making copyright into property.

Some of Doc's words are brilliant political analysis, like this passage. "Liberals often are flummoxed by the way conservatives seem to love big business (including, of course, big media). Yet the reason is simple: they love winners, literally. They like to reward strength and achievement. They hate rewarding weakness for the same reason a parent hates rewarding kids' poor grades."

Some of it is insightful business analysis, like this passage. "In the words of David Eisenberg the Internet's innards purposefully were kept 'stupid'. All the intelligence properly belonged at the ends. As a pure end-to-end system, the Net also was made to be symmetrical. It wasn't supposed to be like TV, with fat content flowing in only one direction."

Some of it is intelligent historical analysis, like this passage, quoting a "National Review" article. (Knowing who to quote and where is an important aspect of creativity.) "We now have an exact replica of the medieval Stationers' Company, which controlled the English copyrights, only its names today are Disney, Bertelsmann, and AOL Time Warner. The big media companies, holding the copyrights of dead authors, have said, in effect, that Jefferson, Madison, and Hamilton were wrong and that we should go back to the aristocratic system of hereditary ownership, granting copyrights in perpetuity."

There are many ways in which an analysis like this can be imprinted on the minds of both elites and the public. There are entire infrastructures in place to do just that. What's missing is a way to take great stuff like this, which comes from the Internet, and putting it into the right minds, for someone's business and political profit.

That's what a Think Tank for the 21st Century would do. It would be truly borderless, ignoring whether work came from the social, historical, political, or business end of things. It would offer PR, white papers, conferences, and campaigns of all sorts. It would be both profitable and important. For a name, I'd start with Open Sources. And it would start life as a virtual team.


The Role of Paid Content

Not all information wants to be free.

A brand or a world-shaping white paper needs to be expensive. If a Fortune 500 CEO writes a really big check he will pay attention to what he's told. If he doesn't he won't. The check pays for that attention. It must be big enough to guarantee that attention or the information has no value.

The value information has, in other words, depends on the hearer. The more specific you can make your information to the person who needs it, the more you can get for it. This is part of what I call the "inverse square" law of journalism - fat newspapers are worth 50 cents, thin magazines $5, tiny newsletters $100 or more. That is because the newspaper's costs are offset against many readers, plus ads, while the magazine has somewhat fewer readers and ads, and the newsletter has just a few readers and no ads.

Insights like these, too, are valuable. If you pay attention to the market for paid content you can create a nice little newsletter business. That is what Rafat Ali does , with a newsletter called Paid Content . With a narrow niche of publishers there is enough money in the market to keep one reporter in beer and skittles.

This is not news. For many years one of my favorite people here in Atlanta was Alan Jenks, a one-time "Wall Street Journal" writer and, later, my first editor at the "Atlanta Business Chronicle". After leaving the latter paper Alan wrote ran a succession of small newsletters, at $300-500/year, under his own name until he decided to retire.

The Internet's lower costs - lower costs of finding readers, of collecting information, and of disseminating information - will allow more, not fewer, of these small businesses to develop. The only surprise is that people are surprised.


Voice Remains A Key Always On Technology

I insist that voice is a key to the World of Always On. Tapping on a keyboard, clicking a mouse, or hitting a remote control seems to be easy, but when the computer is in the air, because the application is on a wireless network, it's not optimal. You have to walk to the screen and read it, the mouse has to be over the right place for a click to be useful, and where do you point the remote?

But reliable voice controls are hard to create. The failure of such companies as Lernout & Hauspie has also caused development dollars to flow elsewhere. But it's the difficulties around voice that make it important. Voice processing algorithms can chew up the MIPS Moore's Law is creating. The differences among human voices can, combined with the use of keywords, create security for Always On applications without the need for encryption.

So IBM's new voice kit for Websphere is an important announcement. Having a solid vendor like IBM selling the toolkits is one reason. Tying voice into Internet standards is another reason. IBM won't make a ton of money right away from this, because the need for Always On voice controls won't become apparent until Always On application markets start to develop. But it will come.


Clued-in, Clueless

Clued-in is Palm's new Tungsten T2 PDA . It's essential to have a high end if you're to remain a viable player in the market.

Clueless are the publishers of Harry Potter who have done exactly what the RIAA did - ignore the possibilities of doing business digitally until someone does it without cutting you in, then complain to lawyers about it.


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