A-Clue.Com
by Dana Blankenhorn
Volume III, No. XLIV
For the Week of November 1, 1999

This Week's Clue: Money (It's a Hit)

This Week's Clue: Money (It's a Hit)

SSP (Shameless Self-Promotion)

Frustrating Links, with Genius Attached

How Small Sites Can Profit

How We Get To Crash

Clued-in, Clueless

Don't give me that do goody good bullshit either. It's been 25 years, but Pink Floyd's biggest hit, from "Dark Side of the Moon," still resonates. It's the Silicon Valley "robber barons," as "The Industry Standard" dubbed CEOs recently, who are today's rock stars. (I, on the other hand, was termed a simple "madman." Well, they got one thing right.) 

How are we handling being rock stars?

We're not handling it well. Wealthy net-executive parents pay no more attention to their teenagers than residents of the meanest ghetto and they're paying the same price for it . (At least the ghetto poor have poverty for an excuse.) Tech executives are to the 1990s what the Morgans and Carnegies were to the 1890s, and they're following today's McKinley, too.

The answer to attacks on Internet freedom by these men is to accommodate it, encouraging the use of filters that allow any local censor to keep anything they want from anyone they may have power over. Not everyone agrees with that, and their arguments are (I feel) powerful . But, in fact, most Americans want to go further than filters. The best word I can find for their attitudes are that they're Australian in character.  

Given a choice between liberty and order, businessmen look at Russia and China and choose order without hesitation. It's an impulse government is more than happy to oblige . This can be a dangerous choice online, because strong encryption guarantees that strict order can't be enforced. (Read that last sentence again - it's important.) 

The fact that Sweden has (so far) gotten more from Internet technology than the U.S. may be instructive here. We've become so accustomed to condemning the welfare state as sterile we've ignored the growing sterility of our own culture, and as in Rockdale County we're paying a fearful price for it. Is the answer to that problem really to try and kill online freedom? Rockdale has been on the forefront of that effort and look what it has gotten for its trouble. 

The fact is Silicon Valley is more like Rockdale County than its residents would like to admit. Money doesn't cure all ills, and if we want to protect our right to make money, an admission of that fact wouldn't hurt. 

This admission should come in the context of larger goals. The fact is that all Internet users share political interests. We need liberty, we need transparent markets, and we need political stability in order to do our business. You can't always get what you want (unlimited freedom and unlimited money) but if you try sometimes you just might find you get what you need. (That was a hit, too.) 



SSP (Shameless Self-Promotion)

I have begun my adventure at Voxcap.Com, discussing how next year's elections might impact the future of the Internet. I write daily for ClickZ, and appear on TechEdge Radio. I write monthly columns for  NetMarketing, Boardwatch, and  Intellectual Capital. Once every other month I'm in CLEC Magazine. The lead item here is also the Monday e-commerce column of Andover.News. You can still buy my book . Subscription instructions are at the bottom of each issue.

Remember that it's still journalism that keeps the Clues coming. Give me a call at 404-373-7634. (Yes, I do some commercial writing.) Now back to the show...


Takes on The News

Frustrating Links, with Genius Attached

Ticketmaster head Charles Conn thinks you should have permission before you link to another Web page , and that's nonsense. As I've said many times, there are ways to frustrate incoming links. You can charge for content, as the "Wall Street Journal" does, thus making incoming links inoperable for anyone who's not a customer. You can hide links behind a password-protected firewall, which will do the same thing. (Dynamic sites aren't properly indexed anyway. Even the database-driven sites that want incoming links find it hard to get them.)

Or you can do what the idiots at FoxNews have done, use technology to redirect everything back to your home page. I was recently directed from Intenet.Com's Newslinx to a story on "Neuromancer" author William Gibson at Foxnews.Com, under the URL http://www.foxnews.com/books/102299/writersblock_gibson.sml. But watch what happens when you click that - this code (js_index.sml?content=) is inserted by the Fox server, and you land on their home page. The way Fox is using it is incredibly stupid, it's a major waste of time, but at least it shows what's possible.

Gibson's takes, once you reach them, are (as always) extraordinary and as provocative as anything Jesse Ventura has ever imagined. "The business of being a futurist has become a short-term deal," he says. "We've invented something that's going to bring about the dissolution of the nation state," namely the Internet. Gibson's last three books, by the way, have centered on nanotechnology. "Nanotechnology is what they call a technological singularity - it creates such enormous change that history basically ends, the species ends, and we develop into something so technologically 'other' that we wouldn't recognize ourselves as human," he tells Fox. (Now you don't need the link, right?)

How Small Sites Can Profit

The question of how small companies survive in a land of giants has been around ever since IBM grabbed the concept of Univac's first mainframe computer and ran with it. It's a staple theme of Clueless business reporters from "The Wall Street Journal" and "Business Week" down to your weekly business fishwrap.

Yet small outfits still percolate upward, from Microsoft in the 1970s to Compaq in the 1980s to Yahoo in the 1990s. And still idiots ask the question, as MSNBC's Elliot Zaret has recently. His example, Ureach (http://www.ureach.com), is instructive. Co-founder Krishnamurty Kambhampati complains that aspects of his technology are quickly copied by the likes of Excite, so Zaret makes the (stupid) leap small outfits can't survive today. (One guy's stupid, most start-ups have always died, so success is impossible and 2+2=5.)

This is the bunk. Anyone who has seen the movie "Tucker" knows better than to attack entrenched power head-on. (This is like Rice trying to run on Nebraska.) You find something the other guys aren't doing, build that niche, and if it's a simple technology you license it. (Bill Gates sold IBM an operating system Big Blue didn't want to build. Compaq built luggable PC clones before IBM wanted to. Yahoo's Web index is still unique.) Come to think of it, though, with today's wide-open passing attacks Rice  would try to run against Nebraska. (Not that it would do us a heck of a lot of good.)

How We Get To Crash

When Excite announced last week it had bought Bluemountainarts.com for what could turn out to be $1 billion, I made light of it in my daily column for ClickZ.Com. But Denise Caruso, in a story that hit the streets the day the deal was announced, , neatly summarized the real danger in this thing and all deals like it.

The problem is that stock has become money, so the money supply (and the value of money) is out of the Federal Reserve's hands. "The Internet creates vast amounts of 'near-money,'" she wrote, quoting veteran venture capitalist William Davidow. "It's not even a Ponzi scheme, because there's nothing downstream to pay off the investors."

Or, as CNBC's Joe Kernen asked recently, "What happens when all this money goes to money heaven?" What will happen is that those who didn't turn their stock into real cash will become poor real fast, and even the value of real money will fall hard. What will follow that will be a liquidity crisis - not enough money chasing too many goods. Someone will have to step in and buy. The reluctance to do so (having the government print money to buy goods on the cheap) kept the Great Depression going until World War II forced that solution on a reluctant West. That's not a prediction - that's just a history major talking.

Clued-in, Clueless

Clued-in is Better Campaigns for its balanced story on the current controversy over the Bush campaign's actions before the Federal Election Commission aimed at reining-in online political speech.

Clueless is the underlying complaint . Even if the FEC agreed with its premise, a ban would be completely unenforceable, and simply anger Netizens against the Governor's campaign.


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