For the Week of December 29, 2003

It's a myth that the affairs of men are wholly unpredictable.

The particulars are beyond knowing, but the tides themselves are easy to chart. Markets fall when everyone shouts buy, and rise when everyone wants to sell. Once people know how to use a technology, its growth days are over. And every generation faces a political crisis of confidence, when the old assumptions cease to work, in which new beliefs are forged.

When will the market turn, and how hard I can't tell you. Exactly when a technology reaches saturation I can't tell you. Have we reached that political crisis point, and how violent will that cataclysm be? I can't tell you.

I only know that the patterns repeat, cycle-after-cycle, in all areas of life. It's human nature, the desire for change, each generation's attempt to climb higher than the one before.

And now, I suspect, begins our time. And the time of our children.

The year 2003 represented a bottom in many ways. It was a bottom for the markets, a bottom for my career (and probably yours), a bottom for progressive ideas, a bottom for America's relations with the world.

But no alcoholic ever takes AA seriously until they hit some bottom, and for each one it's different. I embarrassed myself at the time of my wedding. I was an idiot until I found God. Or I lost a fortune, lost my family, fell into the gutter, literally died. Somewhere the bottom is reached, the turn comes, and the soul commits to flying for real, unaided.

There are many kinds of alcohol in the world. Each is a crutch, something you lean on until you topple over. Money can be a crutch, an abusive relationship can be a crutch. A business model can be a crutch. A political philosophy can be a crutch. The crisis comes when the crutch stops working, it shatters, breaks, you're there on the ground.

As James Taylor wrote,

So in 2003 we were on the ground. We surrendered. Some surrendered to violence, in hopes of quenching their rage. Technology markets surrendered to slow evolution, a solution offering short-term hope and long term loss.

Democrats surrendered too. First they surrendered to their rage, and when it was validated they began to gather on this medium, the new fireside. They stopped bowling alone, and many became active. The miracle of connection began again. The cycle of political growth was renewed.

How long before the harvest? I can't tell you. Maybe never. For progressives Howard Dean may turn out to be Barry Goldwater, Ronald Reagan, William Jennings Bryan, or something (someone) entirely different. Which is it? I can't tell you. I only know that something new began this year.

I had to see it for myself. So at the bottom of my career, in early June, my wife and I drove six hours north from Connecticut, into the wilds of Vermont, through forests I had never seen, to an office park off a stub freeway, behind a big box retailer. There were only a few dozen people then, all glad to see us, to chat, to take autographed copies of my book, to show us around, as awed by our visit as we were by them. They were unspoiled, like a great little restaurant that hasn't yet been reviewed. And I warned them, you're about to become a tourist trap, you're about to be overwhelmed by hungry people, you've got to scale, you've got to build platforms and bureaucratic systems that can handle exponential growth.

They got the Clue. Maybe they didn't have to hear it from me. All I know is now they're all famous, Matt Gross and Zephyr Teachout and Joe Trippi, household names, big-timers. Where do they go from here?

I don't know. That's the magic of life. You can know the patterns, you can hear the song in the wind, but you can't know exactly how it will play out, just that it will.

That same weekend, as I explained last week, came my own turn. Progressive Strategies brought me to the attention of Big Tech for the first time, in a format that guaranteed I get a hearing, because the right people are paying enough money to assure they will listen. Is this where my vision of Always-On, of the Internet in the Air, starts to become reality, and sweeps me along to glory?

I don't know. That's the magic of life. I may be ignored again, my words may be twisted, the company may fail for reasons beyond my control. As Chris Berman says, "That's why they play the game."

But the game is afoot. The game has begun. The cycle is renewed. The Dow has broken over 10,000. Technology companies have money to invest in new ideas, new paradigms. They can dare to dream again, the big guys anyway. And if they're dreaming, then the small guys, guys like me, can get a hearing again for our dreams, and perhaps the money needed to make them come true.

Which will come true?

I don't know. That's the magic of life. Someone else may take credit, some other company may get there "fustest with the mostest," all you can do is run your race, as fast as you can, and hope that if the fates point to you then you can scale up, and build a big team, and grow, perhaps even (one day) earn a profit.

There's a new Bill Gates out there, a new Gordon Moore. They may be in college right now (they probably are in fact), or even high school. They not only have a dream, but the instincts, the leadership ability, and the persistence to make it happen, to build the team, to stay on course right through to the end. That is the cycle of business renewal - Wal-Mart tops Sears, Southwest Air tops Delta, Microsoft tops IBM - and all these will be toppled in their turn.

When and how?

I don't know. That's the magic of life. What I do know is that the magic is back.

Happy New Year.

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Shameless Self-Promotion

My last book, "The Blankenhorn Effect" won the Computer/Internet category in the 2003 Independent Publisher (IPPY) awards .

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...

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Shameless Promotion

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Takes on the News

Media As Sport

Most businesses are easy to evaluate for sale. You pay a multiple of their earnings, or their revenue.

Media and sports properties are different. Media, rich folks think, is the mechanism by which other people learn how they should think. (In fact, financially successful media enterprises are a mirror to their readers.) Sports teams give them reason to cheer. Owners get to think the fans cheer for them.

So these properties often are not valued in conventional terms. Roman Abramovich, a Russian oil kleptocrat, wins himself the love of London by buying Chelsea F.C. and then splashing out the cash for every great player he can get. Sun Myung Moon soaks up decade-after-decade of losses at "The Washington Times" because he wants to be a political player. The purchases have much in common. Both buyers wish to buy love, popular acclaim, power. Media and sports represent means to that end.

So it is with the sale of New York magazine, to Bruce Wasserstein The price, $55 million, is ridiculous, but Wasserstein hopes in this way to become a political player.

Proving once again why you want to buid yourself a media business instead of, say, a manufacturer of ball joints. A fool and his money are sooner parted by glamour than by the practical.

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What Is Wi-Fi For?

MCI is just the latest big telco to splash out cash to say that it's "expanding its Wi-Fi footprint"

MCI wants to be relevant in the wireless world. But MCI doesn't have a Clue. It's just throwing money at a buzzword.

The question is, what is Wi-Fi good for? By itself, bandwidth means nothing. To have value, bandwidth must be used for some purpose. There must be an application. And when you're talking about a hotspot, that application must be specific to the medium.

Too many telcos are throwing money at Wi-Fi thinking they're buying telecom concessions. They're not. What hotspots are going to be good for has yet to be properly defined. It's the company that creates the application, not the one that puts up the antenna, that will make the money in this area.

Another Opening, Another Show For Motorola

Great organizations get strength from their bench. Winning teams promote assistant coaches when the old ball coach quits, and the fans cheer. Losing teams buy a savior, a story, the next big thing.

That's how you can tell the two apart in business, too. Novell went after "the next big thing" when it hired Eric Schmidt from Sun some years ago, but the magic wasn't transferrable. Motorola has been at this failure game for ages - first George Fisher, then Chris Galvin, now Ed Zander - again, from Sun.

What an outside leader can bring is a great vision, something to execute on. Ed admits he ain't got it. He liked the company's size, its brand, its history, but what is the next step? "I don't know what that is yet. I know it is somewhere in the world of communications." He sees assets and possibilities.

The fact is, Ed Zander has never had a vision to call his own. He has only executed others' visions, and he has done that well. He executed Scott McNealy's vision (when it was good), and Eric Schmidt's (when it was good). He is a fine nuts-and-bolts, manufacturing-and-marketing, three-yards-and-a-cloud-of-dust kind of guy.

In football, we call this kind of guy an offensive coordinator, maybe a running backs coach. In business, we call him the president, the number-two. He's not an entrepreneur, not pretending to be one.

And unless Zander can find a vision, he will fail. If he wants one, call me.

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Clued-in, Clueless

Clued-in is Intel's new strategy for flat-panel TVs , a single chip combining the screen and processing. "This brings Moore's Law to digital television" said Richard Doherty of Envisioneering (one of my favorite people), in the form of 7-inch thick, 50-inch across digital sets at under $1,000 for next Christmas. Ho-ho-ho.

Clueless is Microsoft's new Windows watch . Don't give me an operating system, give me applications.

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