From the perspective of any modern corporation, Steve Jobs was a misfit and never should have made it to the top of the world’s largest technology company.  Compared to his peers at AT&T, RIM, Hewlett-Packard, IBM, Samsung, LG, Lucent, Nokia, and even Google, one of these things is not like the others.  These people, while they are for the most part talented managers and/or innovators, are not brave and unconventional visionaries questioning — and challenging — the status quo.  The template of a contemporary CEO simply does not apply to Jobs.. yet it is safe to say that he created more shareholder value during his split tenure at the helm of Apple than all of these combined.

Jobs doesn’t fit as CEO material because, as I wrote a few years ago, the design of corporations systemically weeds out and ultimately purges people like Steve Jobs, tending to favour evolution over revolution; hedgehogs over foxes.  Insodoing these institutions prefer making incremental steps toward that which can be known and quantified versus embracing risk and opportunity to make great leaps forward.  HP or Microsoft would never have brought us the iPod.  Certainly not the iPhone.  And the efforts of Apple’s competitors in the tablet space?  Hmph.

The lesson with the greatest gravitas from Steve Jobs’ famous 2005 Commencement Address is in my opinion the following:

You can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something — your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life.

So what made Steve special is that, having ascended to the top of the technology industry ecosystem, he was seemingly a fluke.  Those dots — The iPod led to the iTunes Music Store and to a flattening of media distribution and to the iPhone and iPad and beyond — all connected back to a single leap where a computer company decided to sell some portable music devices and see what happened.  Jobs made big bets all the way along and knew that the dots would somehow connect down the road, and staked his personal and corporate reputation on quality in every regard.  No focus group or market research could have supported the decision to place these bets, and so no other CEO did.

Many of us think that we have the courage to make big bets.  Far fewer among us are given the resources and leeway to execute these broadly.  Still fewer among those are actually successful in both ideation and execution.  Steve Jobs danced on that razor’s edge and always came away unscathed, teaching us all that it can be done and that the rewards for success await.

Steve Jobs created new markets and made us crave things we didn’t know we would need; he helped us consume information and ideas in ways we never knew we could; he literally tore apart the media business and set forth reshaping it to be more consumer-friendly.  All the while he dazzled us with things which are ‘insanely great’ like a magician entertaining a crowd of transfixed six-year-olds.

The saddest aspect of Steve Jobs’ passing is simply that without him it will be a long time before a similar revolutionary will ascend the treacherous climes of corporataucracy to lead another hugely successful company to create things which dazzle and inspire us.  If ever.

Here’s hoping there’s another Steve in the wings somewhere.  Until then, we’ll likely have to make do with a whole lot less magic in our world.

So I suppose it is no surprise that the in-crowd is gleeful about the judgment.  It has all of the requisite keywords to invoke the sort of self-satirizing knee-jerk rejectionism that we have come to expect from the cornball neopop blogosphere types that take the time to type these missives (I can be fairly accused of being one of them, too).

But isn’t it time to progress beyond our cliched fear of Microsoft?  The DoJ hurricane blew past their ranch years ago; the company’s dominance in Operating Systems is now respectably challenged by Apple’s OSX and various flavours of Linux (and, if only in vapour, by Google Android); and their web browser is being resoundingly thumped by an influx of not dissimilar offerings from Firefox, Apple, Google, and even Opera.  The Zune is an also-ran MP3 player next to the iPod, and Windows Mobile has become a running joke in the telecom industry while the iPhone has become the dominant player in a little under two years.  The next penny to drop for Microsoft may well be Enterprise apps, with Office and Exchange as the cornerstone.  If someone figures out Shared Calendaring, my friends, that latter jig may be up but soon.

So it’s probably fairer now to conceptualize Microsoft as the aged, embattled warhorse that it is; as bloated and sweaty as its present CEO; both of them a heart seizure waiting to happen.  With billions in the bank it’s hard to feel too sorry for them, but would we be cheering so loudly if the party on the losing end of this patent dispute was any other company?

In recent months the company has been sued by patent holders and licensors over a litany of fairly benign and long-implemented technologies from instant messaging to Windows Update to  its Product Activation System.  Each of these is a clear improvement without which Windows, an already unusable operating system, would be significantly worse.  And so in a worst-case scenario Microsoft is now hampered from delivering you a higher-quality, more innovative product not due to lack of imagination on the part of its engineers, but due to a wellspring of imagination emanating from patent attorneys and their litigious clients.

i4i isn’t strictly a patent troll, but they’re not the original inventors of the technology either.  They are also clearly using this patenet defensively, to prevent Microsoft from encroaching on their market.  This is really an obstacle for anyone who wants to do complex document workflow automation (and lots do).

We actually need for Microsoft to win some of these disputes.  We will all benefit.  Each sets a dangerous precedent that will affect all comers upstream of these cases, and a patent troll armed with a lucrative victory on something so obvious and derivative of open-standards as the ability to edit custom XML is dangerous to the web as a whole and will create a substantial speedbump to innovation.

So maybe just for a while keep your malicious joy in check when reviewing this case.  Microsoft is presently doing the web a favour acting as a breakwater for all of us.  I’ll hold my judgment until we see how they put their own patents in this arena to use (or disuse).

During this time the practise of Policy by Press Release rose to prominence as ill-founded concepts like the “Bomber Gap“, “Missile Gap“, and “Submarine Gap” were leveraged to justify a massive expansion in military spending.  U.S. Doctrine from the end of the Vietnam era to the collapse of the Soviet Union in 1991 was to essentially outspend the Soviets while engaging them in proxy guerilla wars in weak communist ally states and financing developing countries through the World Bank.  It is thought by many (mostly Pro-Reagan) historians that it was indeed the US Military-Industrial Complex that won the Cold War and bankrupted the Soviet Union by simply outspending them.

Nowadays, we live under the spectre of far more benign [perceived] enemies.  Most of us in the technology industry fear Microsoft’s Goliath and align with Google’s David more meaningfully than any political discourse, though we only rarely cower under our desks in fear of a Vodka-soaked phone call between Steve Ballmer and Eric Schmidt (which I am positive has happened).

Google only stumbled its way into Microsoft’s crosshairs nine years ago, whereas Microsoft’s founder Bill Gates has long sought to get in on the action on the Internet and the Web in particular.  The two are presently in a pitched battle on a number of fronts, including Search (Microsoft recently launched Bing), Mobile (Google’s Android is a pattern-cut copy of MSFT’s Windows Mobile strategy), The Browser (Chrome versus the dreaded IE), Email (Google is making inroads into institutional and corporate email services), and Productivity Applications (Microsoft Office as an app and a hosted service versus a number of nascent Google Apps).

Most recently, Google responded to the Bing launch by going after MSFT’s supposed crown jewels with an announcement about Chrome OS.  Microsoft then parried with its own vapourware announcement about Web Office.  Engaging Microsoft on another front on an increasingly expansive battlefield might seem like the smart thing to do, but as Kevin wrote, Spite is not a business strategy. This is akin to pissing in your neighbour’s yard just because he took a whiz in yours.

The Soviets, like our more modern evil empire whose Kremlin sleeps in the dales just outside Seattle, were more cagey than we might have thought in those days.  They didn’t match the US and NATO move-for-move in force expansion, and rather than counter Reagan’s famous SDI initiative with a Star Wars system of its own, they simply rejiggered their ICBMs to penetrate airspace using different methods and geared fighters up to be able to shoot down satellites from within the mundane confines of our atmosphere.

No … the Soviets didn’t join in the arms race — instead they were quite content to watch their enemy blow its own brains out, expanding US debt in leaps and bounds (US debt doubled under Reagan in a single year, mostly on the back of military spending) while their own programs pursued less lofty goals, financing battlefield weaponry and troops on the ground in Afghanistan and elsewhere.

We didn’t know it at the time, thanks to a lot of propaganda from our own leaders, but the Commies were actually the underdog.  And like any underdog, the Soviets capitalized on American fear and loathing to nurture an inflated perception of its own militarism and level of armament, hoping that the US would collapse under its own weight trying to keep up — and it nearly worked.  Some would argue that it has — and that our current and previous economic hiccups, heaped atop rampant social problems in the US, are the reckoning for decades of rampant Cold War spending — and may not be remedied anytime soon.

Google is apparently trying to match Microsoft on every front in the technology industry — but it too is an underdog.  It’s attempting to do so with far fewer employees (Google has 20K employees – Microsoft has 90K), far fewer financial resources, and no apparent profit model associated with many of these businesses.  Microsoft has also had the benefit of nearly 30 years — all supported by revenue growth in the rising tide of the PC revolution — to expand its business aspirations from its core business of supplying Operating Systems.  Furthermore I would argue that the core of Microsoft is no longer Windows, and has instead long been its much more expensive product offering, Office.

If Google is attempting to parlay its underdog status into some sort of puffer fish role, in forcing Microsoft to compete on many more fronts than search, then the insincerity of these efforts is pretty transparent to most of us.  And it will fail.  I use MS Word and Apple’s Pages, but would not even consider using Google Docs.  As a web app, it delivers a far poorer user experience at the point of my absolute maximum requirement for efficiency and dexterity.  Google’s Chrome browser isn’t much better than Firefox, and as I’ve pointed out frequently, Android is a duplicate of Microsoft’s own floundering efforts in the mobile space with little improvement.

Microsoft is likely snickering (I know I am) as it watches Google’s many flailing attempts to strike it in different arenas.  Particularly so in Operating Systems.  Slapping a GUI onto Linux, particularly when said GUI developer is Google — a company apparently bereft of UX designers — is a cynical, me-too play that will alienate the Linux Community and pale in comparison to OSX.

According to Yahoo Finance! on MSFT and GOOG, Microsoft has 3x the revenue and 20% more cash reserves than Google.  That’s an amiable war chest and revenue stream that means it’s unlikely that Google can cause Microsoft to spend itself into oblivion.  Google, on the other hand, is moving in too many areas and executing poorly in most of them.

If Google truly wants to hurt Microsoft it needs to double-down on a sincere effort to unseat Microsoft Office and Exchange and thereby dominate the ways in which we communicate at work.   Otherwise, much as the Soviet Union really collapsed due to radical downward shifts in the price of oil and lack of access to credit, Google may suffer from a decline in CPC advertising and all of the air will spew out from its puffer fish act.

In May Day parades, the Soviets would invite Western leaders to the review stand, as bombers and missile launchers would run circles past the parade ground.  These Westerners would return to their peers wide-eyed with parables of impressive arrays of weaponry and massively inflated estimates of actual force sizes.  Unlike during the real Cold War, Google’s foe is not self-invested in grandiose estimates of its enemy’s fortitude and the rest of us are quite aware that in many cases, such as the ill-fated Orkut and other flailing products, Google’s emperor has no clothes.

And unlike our former evil empire’s round-faced leader, Ballmer is under no pressure for Perestroika.

Here’s a question:  Where do you host your email?

Gersham and I are rather well-known for a business we started in 2002 called Geekmail.  By 2003, we were on the cutting-edge of IMAP-based email hosting and ran thousands of mail accounts on a cluster of 9 servers hosted at Peer1 Network in Vancouver.  We pushed the envelope in anti-spam technologies: combining advanced whitelisting techniques with behavioural, bayesian and heuristic anti-spam technologies and using our own common-sense approaches to deliver very high anti-spam effectiveness with a too-low-to-track false positive rate.

What we achieved, in essence, was a sort of email nirvana.  In those days, giving someone 1GB to store their email on your server was unheard of… but we did it.  Hosting catch-all email accounts was a novel concept … but we did it.  Hosting custom email domains was tough stuff too, even, but we did it.  We also had a hell of a launch party. 

A couple of things conspired to force us to close Geekmail… a situation which I will always regret:  1)  We were taken to court by a fool fellow whom we’d (our mistake) taken on as a business partner, and whose sole objective was to kill the company; and 2)  Google launched Gmail.  The latter was far more significant since it was A)  Free and B)  From the web’s hottest property.

Now, this all is the long way of explaining that I am perhaps something of an email geek.  I’ve used one form of computer-based electronic mail or another since 1985.  I co-founded Geekmail, of course, and also did a considerable amount of strategic work for FrontBridge — the world’s #2 message management service provider before its acquisition by Microsoft in 2005.  BuzMe and RingCentral, two Unified Communications services I helped bring to market, were among the first to deliver voicemail to their users via email (believe me, a novel concept in 1999/2000).

Be that as it may, it rather surprises me that even today GMail (which has been in Beta for 5 years) still pales in a number of key features (including anti-spam) to the technologies and quality of services we provided with Geekmail.  While we didn’t have nearly the scaling issues that Gmail has to deal with (except for in our very early days) we never experienced the kind of multi-hour outages that Gmail regularly hands to its users.  We also focused the users’ experience on Secure IMAP, not a web-based interface (though we had one of those too) and offered lots and lots of storage to go with it.  And in our later version of Geekmail, the anti-spam functions were tweakable: if you didn’t like the default settings, you could turn on and off different techniques that were used to combat spam on your inbox.

When we were forced to let Geekmail die a rapid death, we scrambled around to find a company who could take our subscribers and whose service closely mirrored our own.  The short answer was:  there weren’t any.

It wasn’t until a couple of years later that I began talking with John Capo; founder and operator of Tuffmail.  In addition to being a pretty nice guy, John runs a service that is the closest analog to Geekmail that I can find anywhere.  In my view this ranks Tuffmail as the very best email service provider for email geeks anywhere.  And so it has been for about 4 years that I have blissfully run my personal email address at ianbell.com on this service — and am now at a point where it is so critical to how I do my daily business and live my life that I would be miserable without it.

As these screen shots should reveal, Tuffmail is literally like having your own mail server cluster up in the sky somewhere.  By that I mean practically every aspect of its functioning is customizable to your whims and needs.  I can change how it responds to spam, I can block certain servers from sending me mail, I can blacklist any email sender from connecting to the server, and so much more.  I can also have a catch-all, which many email hosts hate to do because it creates spam honeypots, but which has become a critical means for managing my accounts online.

I don’t do any filtering or routing of email at the client level.  This would be impossible, since I access email from four different devices on a day-to-day basis.  Instead, I have input a complex set of rules into Tuffmail’s extremely robust email rules interface (sorry I can’t show you this — classified!) and all incoming mail is stored in the appropriate folder when I check it from my MacBook Pro, my iPhone, my Mac Pro, or whatever.  Microsoft Exchange, Gmail, yahOo! Mail, your ISP’s Mail Server — they all wither by comparison because they don’t allow this sort of granularity — and because they don’t fully embrace standards-based IMAP email messaging.

I keep all my mail, as well, nearly 5GB at the moment.  So if you said something in 2005, it’s pretty easy for me to find that message in my email clients (this could be the reason why mail.app sucks up most of the free memory on my MacBook Pro) and regurgitate it.  This is extremely handy and it reaffirms email’s rightful place at the fulcrum of my life (sad but true).  This is only possible because I have an enlightened email hosting provider who A) embraces large mailboxes and B) embraces large message sizes, which means I can send around presentations and big graphics files without fear of them bouncing back (unless the receiver’s mail server is a dunce, of course).

I don’t ever receive spam in my InBox anymore, because I have the settings and filters perfectly tweaked to my needs on Tuffmail.  But blocking spam is easy these days.  The real problem is blocking it without also blocking legitimate messages — this is much much harder.  And this is where GMail, which uses the Postini service (which is not directly integrated to GMail), tends to fall over.

Have you ever heard the excuse “Oh, I sent you the email, but maybe it got caught in your spam filter….” before?  Sure you have.  That doesn’t happen to me.  The benefit of the Realtime Reports (screen shot above) is that I can go in to the server logs  and actually see when a message flew through or was rejected by the Tuffmail server hierarchy.  I just view the page, do a Firefox search for the person’s email address, and if they sent a message it’ll be there.  I’ve caught anyone who’s ever made that excuse to me in a white lie… not that I hold it against them.  🙂

There is one downside to all of this, of course… with Tuffmail, I have created a monster.  I have so many settings and tweaks, and I have the spam filters so well-trained, that the pain of moving to another provider would be excruciating.  Most likely, I never will.

I don’t endorse products very frequently (and I never do it for any sort of remuneration) — but Tuffmail is one of those rare birds that truly deserves the kudos.  Email hosting is a tough business and in many ways I’m glad I’m no longer in it.  On the other hand, when I use Tuffmail I get pangs of jealousy and nostalgia.  Ah, what could have been!

Which one are you?  The ancient parable of the fox and the hedgehog has come into increasing view in popular culture lately.  And while its origins are somewhat ambiguous, the allegory has been applied to entrepreneurs, scientists, philosophers, playwrights, business leaders, economists, and even US presidents.

One of the fables goes something like this (sorry, no link to a source … I am paraphrasing a story from my childhood):

A fox and a hedgehog were strolling through a country path.  Periodically, they were threatened by hungry wolves.  The fox — being blessed with smarts, speed and agility — would lead packs of wolves on a wild chase through the fields, up and down trees, and over hill and dale.  Eventually the fox would return to the path, breathless but having lost the wolves, and continue walking.  The hedgehog, being endowed with a coat of spikes, simply hunkered down on its haunches when menaced by the wolves and fended them off without moving.  When they gave up, he would return to his stroll unperturbed.

According to the great liberal (before that was a dirty word) historian and thinker Isaiah Berlin who in 1953 wrote the Essay “The Hedgehog and the Fox“, interpreting the works of Tolstoy, Foxes are complex thinkers who account for a variety of circumstances and experiences while hedgehogs have the keen ability to focus and drive along a single path.  As examples, Berlin flags such thinkers as Plato, Lucretius, Dante, Pascal, Hegel, Dostoevsky, Nietzsche, Ibsen, and Proust as Hedgehogs and slots Herodotus, Aristotle, Erasmus, Shakespeare, Montaigne, Moliere, Goethe, Pushkin, Balzac, Joyce, Anderson as Foxes.

More recently, Jim Collins (author of “Good to Great“) took this concept into the business world in his book and it is one of the central unifying themes of his work.  In his book and other writings Collins comes down pretty hard on Foxes:

Those who built the good-to-great companies were, to one degree or another, hedgehogs. They used their hedgehog nature to drive toward what we came to call a Hedgehog Concept for their companies. Those who led the comparison companies tended to be foxes, never gaining the clarifying advantage of a Hedgehog Concept, being instead scattered, diffused, and inconsistent.

This is understandable.  Collins, a former Stanford University Business Professor, comes from a hedgehog factory.  He has made a career of spooling hedgehogs into mainstream companies at the mid-management level and consulting with large, heavily-matrixed companies on business strategy and leadership.  In many respects he lives in a world constructed by and for hedgehogs — so it makes sense that he could see the “Great” companies he writes about in his books (all typically fortune 500 players) as hedgehogs.  On a long enough timeline we are ALL wrong, but it is worth pointing out that a number of Collins’ “Great” companies have suffered badly from (and others have caused) the current economic downturn, eg. Circuit City.

As Nicholas Kristof describes the dichotomy in the NY Times:

Hedgehogs tend to have a focused worldview, an ideological leaning, strong convictions; foxes are more cautious, more centrist, more likely to adjust their views, more pragmatic, more prone to self-doubt, more inclined to see complexity and nuance. And it turns out that while foxes don’t give great sound-bites, they are far more likely to get things right.

John Kerry is clearly a Fox: A self-doubting; complicated; unable to present absolute, sound byte-friendly answers to complex questions.  George W. Bush, however, presents himself as a hedgehog: simple, direct, ideological, and absolutely assured of his correctness.  In 2004, America signed up for its second term of 4 years of hedgehog leadership to substantial effect.

In our industry, hedgehogs have the benefit of focus and the ability to keep their heads down and companies out of trouble during tough times.  They succeed through the avoidance of substantial risk and through the ability to see things through.  When they fail, it’s because their conservatism holds them back, and markets move past them; or because they can’t release their death grip on that singular idea and move on to the next thing.

The Fox has the benefit of broad vision and the ability to perceive the complex interaction of seemingly dissonant ideas, and they succeed because they are able to travel outside of marked pathways with their ideas and make substantial gains.  When they fail it’s because their reach exceeds their grasp, because they are too far ahead of the market, or because they have difficulty maintaining focus to see things through.

The one problem that Mr. Collins cannot cop to is that while Hedgehogs are mass-produceable through training and discipline (this is what MBA factories do), Foxes are not so easy to come by:  their behaviour is learned but it is most likely interdisciplinary and tangential.  As a modern example, one could strongly argue that Steve Jobs, Reid Hoffman, and many successful tech entrepreneurs are foxes.

On the other hand Bill Gates, who at one time was the richest man in the world:  pure hedgehog.  Rupert Murdoch?  Count the spikes.  There are many successful hedgehogs in the mainstream business world and far fewer Foxes.  The structure of businesses, after all, are generally designed around hedgehogs. In general larger corporate structures aren’t great at absorbing foxes.  It’s why Jobs quit Apple, before going back as CEO under a mandate that embraced his wide-ranging aspirations.  It’s probably why entrepreneurs such as Evan Williams, who blew out of Google as soon as he could after selling blogger.com to them, generally can’t wait to get out of the mother ship after a their lock-up periods are done.  A friend and the CEO of a company acquired by Microsoft always referred to Redmond as “they” and never “we” even while he took down an amazing salary serving as a VP for two years.

Innovation is a concept which we modernists tie into every description of a person’s thinking process.  Wikipedia says there are a few different types of innovation:  “It may refer to incremental, radical, and revolutionary changes in thinking, products, processes, or organizations.”  Perhaps the razor cuts this way:  Perhaps hedgehogs deliver incremental changes while foxes deliver radical, revolutionary changes.

As a fox, I know that many of my successes have come when paired with hedgehogs.  A hedgehog can pluck a singular concept from the maelstrom of energy emanating from the fox and run with it along a narrow path.  Steve Jobs had Wozniak on the engineering side, and just as significantly Mike Markkula on the financing and business affairs side.  The latter two are quintessential hedgehogs.

While it’s valuable to know whether you’re a fox or whether you’re a hedgehog, it is not particularly constructive to assign a static value judgment to one versus the other.  At varying points in the arc of a business, a prevalence of influence from either a fox or a hedgehog can make or break a company.  Witness the foxes that artificially inflated hyper-economies at Enron (Jeff Skilling) and AIG (Joseph Cassano) to great personal benefit but ultimately destroyed hundreds of billions of dollars in wealth.  And meet the Hedgehogs, Gil Amelio and John Sculley, who sapped the growth of Apple, diluted its brand value, and very nearly bankrupted the company.

So figure out what you’re good at, chase the visions you believe in, and if you’re fortunate enough to work in an environment that embraces and supports your particular attributes, you’ll ultimately be successful.

	Upgraded the CPU on my Mac Mini from Core Duo 1.6GHz to Core2Duo 2.33GHz – (instructions & discussion) Results are amazing, and the bump in performance, even during transcoding of video, is immediately noticeable.  Note that there was a dramatic increase in fan noise so hope you’ve got your Mini in a closet somewhere as I do.  (UPDATE:  Fan noise was due to broken heatsink screw.  Here‘s an example of why this upgrade was a great idea)
	Created a generic bootable USB OSX Leopard installer on a 16GB Thumb Drive – (instructions & instructions) Upgrades and refreshes are now a breeze.  It’s also got all of my (licensed) apps like Adobe CS and Microsoft Office on board in case I ever lose my hard drive, etc.
	Installed and began regularly using Sxipper for login automation – (install) Apart from making it WAY easier for me to log in to sites and keep track of all of my passwords, this has allowed me to emancipate myself from a broken Firefox configuration that I have beeb married to since the early Betas.
	Hacked my AppleTV and installed XMBC/Boxee – (instructions) Since I already store my media within iTunes, and since Boxee has very limited content avilable at the moment, this was FAIL.  I do find it interesting to see what others are watching, but the only active friend I have is Boxee CEO Avner Ronen.  If Boxee wants me to be a frequent user, it needs to allow me to subscribe to torrent feeds and automagically download the movies to my AppleTV.
	Maxed out the RAM on all of our Macs – (get some) RAM prices are artificially deflated thanks to the manufacturers vastly overestimating the demand for memory following the release of Windows Vista.  My friends @ CanadaRAM have great prices as a result.  Their loss is our productivity gain!

All in all my future wife was quite dismayed at the number of times I broke out the torx screwdriver and cracked open a computer on the ottoman while watching “Long Way Down” but I’m grateful it’s over with.  Happy New Year all!

UPDATED: One more Bonus thing I did!

Installed Nambu on my MBPro and iPhone for managing my Tweets etc. – (discussion & iphone app ) The Nambu Desktop app is in beta, so you can’t get it yet… but the iPhone cllient is available for cheap from the iTunes Music store.  Keep an eye on the Nambu web site for the launch of the Desktop client.  Nambu in both cases revealed a number of Direct Messages I never knew I had… twitter is notoriously bad at revealing these via its web interface.

Seeya.

Of course, Microsoft can afford to write these cheques practically ad infinitum, but if your tools are so lacking in perceived utility that you need to bribe people to use them (even if the graft is partially subsidized by affiliate fees), perhaps this is not really the best you could hope for from your marketing team.

You can’t take on Google by trying to buy, or even out-feature, your way into the blank-text-box Search Engine arena. Except for some regional players, like Russia’s Yandex, they’ve won and will not soon be replaced.

What Ballmer, and lots of other people, are missing is that the Search marketplace as we know it is poised for a change. Much of this change emerges from the fact that Google fundamentally owns the global Search Market, but much of the opportunity extant in this space comes from the fact that the technology behind search, and how people will make use of search engines in the future, will be a whole lot different than what you see when you type in www.google.com today.

…. but, there is light at the end of the tunnel for folks who are on the outside looking in at Google’s substantial (and impossible to dislodge) market share:

For most people, web search is a kludge.

Think about how you use Google today. Think about why you type things into that blank text space beckoning to you on your Firefox browser, or why you surf over to Google.com and enter a few snippets of text into that empty area amidst the sea of clutter-free Google whiteness ten, twenty, or maybe many more times per day.

In some cases, you overheard something being discussed in a coffee shop. Or you saw a billboard ad. Something offline motivated you to head to the blank text box and ask it to do your bidding. That is Google’s fundamental market opportunity and has remained largely unchanged since the first search engines began emerging in 1995.

This is, however, just a fraction of the reasons why many of us head to search engines. Often the reasons are as much motivated by inadequate information at one site as by anything else. An example: You’re reading an article from a wire service like Reuters, which rarely include photos, about a car or a submarine or a mountain. You’d like to see what that looks like, so off to Google you go. Or you’re looking at a new LCD on eBay, but the seller hasn’t listed the number and type of inputs that come with it; so off to Google you go to try and find the specifications.

In short, most often we go to Google to search for things because our browsers aren’t good at building pathways between like objects on the web. These types of Searches are what I call context-driven. You shouldn’t need to do this. You shouldn’t need to interrupt your surfing to drop off to a third-party site in order to add flavour to the web objects which have already garnered your interest.

What if you could press a button and instantly be delivered relevant information that is contextual to that which you are/were looking at? What if sites displaying articles from wire services (notable for their sparseness) were able to draw in information – in realtime – which added relevant photos, videos, or related stories?

Some of this is already happening, albeit rather jerkily. One of the leaders which started doing this some time ago was Sphere, which was recently acquired by AOL. It took them some time to draw the same conclusions as I have, and they had a difficult time monetizing these services. But on a great enough scale the same technologies which make relevant content possible also make relevant advertising possible. And while click-thrus will be fewer in quantity they can be greater in quality and therefore infinitely more valuable, thanks to much more accurate targeting.

Being accurate in driving these sorts of searches is hard. Whereas Google relies on its users to sift through its top 30 or so recommendations to find the most relevant information, contextual search engines need to be able to do that with high accuracy on the first few matches with little to no meatware — sorry, Mahalo. Many of the current buzzwordy trends such as the Semantic Web initiatives, Social Search, the shift from RSS to Atom, and API-accessible semantic processing are key enablers to make this easier, but there’s still a considerable amount of R&D necessary to beat Google’s current level of accuracy in this regard.

As a result, you need a long lead to get there, and few of the companies dabbling in the Vertical Search space have raised enough capital or have investors who have committed to developing these opportunities. But in the long run, this will augment Web Search and replace much of the traffic that is today driven by Google’s simple, primitive, empty text box.

What’s clear is that Microsoft’s desperate attempts to lure users to its essentially equivalent service to Google’s can only cost its shareholders. A new paradigm is necessary and, fortunately, the opportunity is ripe for the picking, right in front of us all.

This is a rare opportunity where the solution lies in good, solid R&D and product realization — not in leveraging semi-monopolistic product integration or in brute force advertising spending. Is Microsoft bold enough to understand, and embrace, the fact that Search is shifting? Do they have the product and engineering people to make this happen?

Case in point:  Recently, Microsoft announced they would build a research and development centre in Vancouver, and in turn use that operation to recruit and nurture smart people from around the world who were being prevented from entering the US due to immigration hassles.  Microsoft said it as plainly as they needed to:  they had effectively tapped out the supply of smart software people trickling out of U.S. universities, and thanks to increasing costs and constrains imposed by the U.S. INS,  it was just too difficult to fill that void with educated foreigners ; both  which circumstances put U.S. -based tech companies at a pretty significant disadvantage.

From the perspective of those seeking to put Vancouver on the map as far as software and product development is concerned, this served as a tremendous endorsement, and a opportunity which could be seized upon by the local tech community.

The conditions themselves, in turn, couldn’t really be better for any company big or small to operate a research and development centre in a Canadian city in general, when the strength of the dollar, the numerous government incentives such as SR&ED, and Canada’s liberal immigration policies regarding talented individuals such as Engineers.

These are conditions that Canada should capitalize on, specifically by relaxing further the immigration policies regarding software engineers and marketers, creating temporary work visas which can be turned around at the port-of-entry and can serve as a gateway to permanent residency (such as we have with NAFTA), and actively promoting the Canadian tech industry to workers abroad.

The benefits of these preconditions are obvious: diversity of talent equals an increasing wealth of ideas, knowledge, and research — which would ensure that tax credits like SR&ED pursue increasingly meritorious ideas and opportunities. It would also take advantage of a significant mis-step by our friends south of the border.

On my personal blog, I rarely restrain myself from criticism of the Bush government and US foreign policy. So my bias is well-known.. 🙂

As the US Economy is jerkily shifting from a decades-long manufacturing cycle, as the UK did through the 1980s, to a nation that generates the greater part of its wealth from intellectual labours, their leadership is ignoring the obvious: the country lacks enough talent to conceive and build this new intellectual, cultural economy.

It says something about Bush’s vision for America that while he posits an amnesty bill for the millions of illegal and largely unskilled immigrants coming from Mexico and Latin America, he imposes and reduces a cap on legal immigration visas for skilled workers, such as the H-1B.

They U.S. is turning away creative minds (including engineers) at the border, throwing millions of babies out with the bathwater, as they attempt to ebb the flow of “good” jobs being taken from America’s labour force and handed to foreigners. At the same time, those jobs are in turn being fully-outsourced to foreigners residing overseas, as companies attempt to cope with the fact that they can’t meet hiring goals for specialized positions.

In today’s market we compete equally for dollars and for workers on a global stage. When a company outsources its call centre, which uses largely unskilled labour, to India that should not be considered a problem for an advanced nation like the U.S. But when a U.S. company outsources R&D to India (or in this case, Canada) it should be considered a crisis. Microsoft’s move, from a U.S. perspective, is just exactly that. And it shows the grit which companies like Microsoft will go to route around the damage that is Bush’s immigration policy.

The Bush government, by limiting H-1 Visas and making it generally difficult to become a productive, creative resident of their country, has created a window which Canadians can and should exploit to bring talent to our nation: talent which will be trained and coached at the expense of U.S. companies, and will eventually spin out of these R&D centres and create their own new companies sparking new innovation.

This process can be exemplified by the number of Canada’s technology startups (meritorious or not) created by former Nortel executives throughout the last 10 years. That these have all represented a substantial increase in value for Canadian economic development, and the collective intelligence of our software community in general, would be tough to question.

With the quantity of resources available to technology entrepreneurs in cities such as Vancouver, the real challenge today is spending it effectively by hiring talented individuals.

So as our dollar approaches parity with the U.S. dollar making our salaries competitive, as our quality-of-life (particularly in Vancouver) far exceeds that of technology meccas like Seattle and Silicon Valley by all apparent measures, and as our government’s financial support for entrepreneurship continues to give a stage-to-orbit boost for many different ideas, the only pennies needing to drop really are a more sophisticated approach to valley-style Venture Capitalism and continuing expansion of immigration policies to support innovation.

With those two tweaks to our existing structure, a lot will change in the fortunes of Canada’s (specifically Vancouver’s) technology entrepreneurs.

In the meantime, bring more Microsoft’s to the suburbs of Vancouver. They will import some of Canada’s more brilliant Entrepreneurs and their co-workers at U.S. expense for our future benefit.

-Ian.

These prices make Sophos’ acquisition of Vancouver’s Activestate (which, among its products, marketed an interesting anti-spam software solution) for $26M look like a bargain. And with all of these transactions coming in the multiple hundreds of millions of dollars, the number of sellers probably now exceeds the buyers by a 2:1 margin. That means that the remaining two will need to get down to the business of making money.

Fortunately that’s not actually very difficult in the email border security marketplace. The value of anti-spam/anti-virus services for email may soon exceed the money spent on providing email itself. Although the market tracks behind analyst estimates (don’t they all?) email border security was a $3.5Bn market in 2006 and will top $6Bn in 2010, according to Radicati.

The email services business is capital and operationally intensive, and requires a fairly large investment to develop a business. Postini has gone through about $34M in 4 or 5 rounds since its first financing in 2000, from VCs including AltoTech Ventures, LLC; August Capital; Mobius Venture Capital; Pacifica Fund; Summit Accelerator Fund; Sun Microsystems Venture & Strategic Investments; and Bessemer Venture Partners. The company’s probably been cash-flow positive (or near to it) since late 2005.

It’s tempting to view this acquisition as an admission that fighting spam is a problem requiring dedicated resources.. the upshot would be that GoOgle will certainly be able to increase the efficacy of their internal spam-fighting strategies. But that ain’t the whole story. Google likely does have the expertise to effectively eradicate spam flowing into their G:Mail network, but of course it could also benefit from more advanced strategies developed by a more evolved spam fighter, for sure. But that’s not worth $625M.

More ominously for Microsofties, Postini’s customer list (which likely numbers into the tens of millions of mailboxes) makes an excellent channel-to-market for a business-class managed email service as G:Mail moves into that particular high-value market segment. While Postini’s mailbox numbers are inflated because of some of their early success with ISPs (FrontBridge was totally focused on Enterprise), each of the “big four” managed email security vendors did a fairly good job at optimizing their sales and customer acquisition processes for dealing with business customers. Google has no experience with this at all.

But wait, there’s more: most people make the mistake of looking at the “big four” (Postini, FrontBridge, MXLogic, MessageLabs) as purely anti-spam/anti-virus companies. And fair enough: that was the crux of their value proposition as the spam problem flowered out of the late nineties and hit home hard starting around 2001.

But the big undercurrent in the managed email services marketplace after the anti-spam value proposition started to blow over in 2005 actually became compliance archiving. Big companies were spurred by the penalties imposed on company directors and board members by Sarbanes-Oxley combined with the NASD 3010 and SEC 17a requirements for public companies. Also, an increasing number of court cases have relied on email discovery to substantiate their cases, which if your archives are on CDs or Tapes can be very, very costly. That’s why FrontBridge purchased MessageRite in 2004, and it’s why immediately thereafter their competitors set forth beefing up their email archiving and retrieval stories. Google hints at this in their acquisition FAQ:

” .. businesses have been forced to choose between innovation on one hand, and these backoffice mandates on the other. In effect, many businesses use legacy systems not because they are the best for their users, but because they are able to support complex business rules.”

They made an even stronger statement to this effect on the conference call. As El Reg reported:

“In a conference call, Girouard added without giving figures that there had been “significant interest” from large business about Google Apps but that complex security requirements and meeting regulatory compliance have acted as a barrier. “Up to date we have focused on partnerships to resolve these issue but we recognised it’s in our own interest to pull things together” by buying a technology that can boost its hosted apps business.”

The archiving and electronic discovery driver in particular plays well into GoOG’s current capabilities — massively-scaled indexing, searching, and storage of data — particularly well, don’t ya think?

Give people choice and freedom and they’ll pay. Try to sue your own frickin’ customers into oblivion and we’ll see you in bankruptcy.

-Ian.

—— http://story.news.yahoo.com/news?tmpl=story2&u=/washpost/20030909/ tc_washpost/a47297_2003sep9&e=1 RIAA vs. the People Tue Sep 9,11:06 AM ET

By Cynthia L. Webb, washingtonpost.com Staff Writer

The Recording Industry Association of America ( news -web sites )made good on its promise to prosecute Americans who engage in the illegal downloading and trading of pirated music, filing 261 copyright violation suits yesterday.

“Legal actions have been taken on a sporadic basis against operators of pirate servers or sites, but ordinary computer users have never before been at serious risk of liability for widespread behavior. The RIAA said that’s the point it’s underlining with the unprecedented legal action,” CNET’s News.com reported.

But in an editorial today, the San Jose Mercury News said the RIAA’s legal campaign is bad policy: “Suing your customers, as a long-term strategy, is dumb — even if they bring misfortune upon themselves. … The suits are the unfortunate, but predictable response of an industry that failed to see the Internet until it stared it in the face. Since Napster ( news -web sites ) first appeared four years ago and declared the death of the compact disc, music CD sales have fallen more than 25 percent. A generation of music fans don’t think twice about copyrights, which they associate with overpriced CDs and parasitic studio execs.”

According to the Mercury News editorial board, the music labels “won’t win back many of those customers until they make their full catalog of tunes easily accessible over the Internet, in formats that people want, at prices they’re willing to pay. That’s starting to happen — Apple Computer ‘s iTunes Music Store and BuyMusic.com are offering songs from 49 cents to $1 — but the offerings are limited. The music studios are still dragging their feet. For now, the big labels hope to scare people straight, particularly parents, since copyright owners can sue children for theft.”

The New York Times pointed out an even larger implication of the RIAA suits: “With the club of lawsuits and the olive branch of an amnesty program, the music industry is waging a campaign against online piracy that relies on both public relations and economics to attack the idea that everything in cyberspace can be free,” the article said. “That will not be easy. The Internet sprang from a research culture where information of all kinds was freely shared. That mentality still resonates with the millions of Internet users who routinely download music onto their computers. But the emphatic message of the music industry’s two-step program announced yesterday is that the days of plucking copyrighted songs off the Internet without paying for them are numbered.”

An Escalating Fight Against Ordinary People

Thousands more lawsuits against fileswappers are expected in the coming months as the RIAA looks to make examples of the worst digital pirates: People accused of downloading and sharing on average more than 1,000 illegally downloaded songs, thanks to Gnutella ( news -web sites ),Kazaa ,Grokster and other popular file-trading services.

The Washington Post said the “legal offensive aims to stem the tide of online song sharing launched by Napster in the late 1990s, and it is likely to strike fear into the hearts of parents who have not closely monitored their teenagers’ computer habits. That’s because the lawsuits were filed against the holders of Internet service accounts, regardless of who in the household was responsible for swapping the songs.”

The Los Angeles Times said the “cases — the first of thousands the labels expect to file in federal courts — mark a turning point in the music industry’s four-year battle against rampant piracy on the Internet. For the first time, the recording industry is training its considerable legal firepower on individuals, not the companies profiting from the public’s hunger for free music,” The Los Angeles Times said. “One quirk in the process, though, is that the defendants named aren’t necessarily the people using file-sharing networks. That’s because the Recording Industry Assn. of America’s investigation identified only the people whose Internet access accounts were being used to share files. They might be the parents, roommates or spouses of the alleged pirates.”

The RIAA suits hit the young and old and stretched across economic lines too. Among those sued is the Bassett family from Northern California. ” Scott Bassett said neither he nor his wife used the family PC in Redwood City, Calif., for music, but their teenagers and dozens of their friends do. Had he known what was going on, he said, ‘I would have pulled the plug,'” The Los Angeles Times reported, quoting the former junkyard operator who, like other targets of the suits, was confused about what to do. “Do I really need to hire a lawyer? Can I just call them up and say I’m sorry and give them back all the music that was downloaded? I’m just a little guy,” Bassett told the paper.

The Bassetts were darlings of the media yesterday, appearing in a number of articles, perhaps since they illustrated so nicely the ironic twist of the suits, which can target people who own the ISP accounts, not necessarily the file-swappers themselves. “I can’t believe this,” Vonnie Bassett , mother of a 17-year-old file-swapper, told The San Jose Mercury News. “To think I might actually have to pay money to these people. I think it’s the stupidest thing that the recording industry would do this.”

Lisa Schamis , a 26-year-old New Yorker, “said her Internet provider warned her two months ago that record industry lawyers had asked for her name and address, but she said she had no idea she might be sued. She acknowledged downloading ‘lots’ of music over file-sharing networks,” the Atlanta Journal-Constitution reported. “This is ridiculous,” Schamis said. “People like me who did this, I didn’t understand it was illegal.” Neither did Nancy Davis , a Sanol, Calif. schoolbus driver. “From what I understood — and I’m not the most computer-savvy person in the world — I thought it was becoming legal,” Davis told The San Francisco Chronicle. “I’m completely shocked by the whole thing,” Heather McGough , a single mom of two children from Santa Clarita, Calif., told The Los Angeles Times. She “figured that the music-sharing services that survived after Napster was shut down must be legal. She said she let a friend install a program for the Kazaa file-sharing network on her computer so that she could listen to music — songs she already owned on CDs — while she worked.”

Paying the Piper

So what’s in store for those snared in the RIAA lawsuits? “The RIAA suits seek an injunction to stop the defendants’ file sharing, as well as damages and court costs. Copyright law allows for damages of up to $150,000 per infringement — in other words, per swapped song,” The Washington Post noted. More from The Boston Globe: “Accusing the defendants of copyright infringement, the music association is requesting statutory damages of $750 to $150,000 for each song, bringing the potential liability of some file-sharers into the millions of dollars.”

“Individuals, I’m sure no matter who they are, simply don’t have that kind of money,” Atlanta attorney Doug Isenberg , who specializes in Internet law, told The Atlanta Journal-Constitution. “And there’s no way possible the RIAA can sue even a meaningful number of people, because there are tens of millions of potential defendants.”

Perhaps some good news for those being sued: The Philadelphia Inquirer reported that the “RIAA has been settling for less: Yesterday, it announced $3,000 agreements with fewer than 10 people whose Internet service providers had received subpoenas.”

RIAA President Cary Sherman told The Los Angeles Times “he would welcome cases going to trial because it would help establish for the public that file sharing is illegal. The proceeds from any trials or settlements will be kept by the RIAA to cover the cost of its anti-piracy campaigns, he said, rather than being used to compensate labels and artists. Several lawyers warned that the RIAA’s amnesty offer may be a bad deal. Those who apply for amnesty from the RIAA must confess their past transgressions, but that won’t protect them from being pursued by music publishers, independent labels or even federal prosecutors.” The RIAA is offering amnesty to those who admitted to file-swapping, erase their digital libraries of songs and sign a notarized promise not to do it again.

Criticism From the Usual Suspects

Critics of the RIAA’s move were vocal in their objections to yesterday’s developments. The Electronic Frontier Foundation clearly hates the idea of the lawsuits. “Does anyone think that suing 60 million American file-sharers is going to motivate them to buy more CDs?,” EFF Staff Attorney Wendy Seltzer asked in a statement . “File sharing networks represent the greatest library of music in history, and music fans would be happy to pay for access to it, if only the recording industry would let them.”

Bill Evans , founder of Boycott-RIAA.com , told The Baltimore Sun that the lawsuits amount to a witch hunt. “They are trying to intimidate people and to stop file-sharing because they can’t control it,” Evans said. “If that’s the case, we believe they should take over a portion of the market and make it more affordable to people.”

Elan Oren , chief executive of file-sharing site iMesh , told The New York Times that “rather than filing huge lawsuits, record labels should work with file-sharing services to devise a method of compensation in exchange for legally distributing their music over the peer-to-peer networks. But record companies say creating a compensation system for file sharing — for instance, imposing a tax that could be redistributed to copyright holders — would be extremely difficult.”

“Michael McGuire , research director at the GartnerG2 research firm, said the threat of legal action needs to be just one part of a more widespread effort by the recording industry to deal with illegal Internet music swapping,” The Chicago Tribune said. “Are hard-core traders going to see the light and see the error of their ways?” McGuire told the paper. “I don’t think so.”

RIAA Strategy Paying Off

The music industry’s tactics, while controversial, have made a dent to some file-swapping. “Still, there is little agreement about whether the industry’s tactics are having much impact on music piracy. The recording industry has cited data from research firm NPD Group that estimated the number of households downloading music from the Internet declined 28% to 10.4 million in June from 14.5 million in April, around the time music companies began publicizing a campaign to target individual file sharers. Music companies have also been trying to wean music fans off file-sharing programs by licensing their songs to commercial music sites like Apple Computer Inc.’s Music Store,” The Wall Street Journal reported. “But services like Morpheus, LimeWire and Grokster all report that usage of their services has grown, especially as students have returned from vacation.”

But the music industry has a long way to go before it stamps out piracy. “From the rise of Napster until today, tens of millions of people have started trading songs, movies and software online through services such as Kazaa with little thought for the legality of their actions,” News.com noted. “Even as the threat of Monday’s lawsuits loomed, more than 2.8 million copies of the Kazaa software were downloaded last week, according to Download.com , a software aggregation site operated by CNET News.com publisher CNET Networks . Indeed, a recent study by the Pew Internet and American Life Project found that 67 percent of people downloading music said they did not care whether the music was copyrighted or not.”

The Future of E-Music?

Apple’s iTunes is being held up as a successful, legal alternative to secret file-swapping. The pay-for-play service has been a hit with music fans and everyone from Sony to Microsoft is looking for a comparable match to compete with the service. Apple’s service has sold 10 million songs since its launch in May. “Legally selling 10 million songs online in just four months is a historic milestone for the music industry, musicians and music lovers everywhere,” Apple head Steve Jobs ( news -web sites )said, according to BBC News Online, which noted (how ironic, in light of the complications of the RIAA’s legal suits) that the 10 millionth song sold on the service was “Complicated,” by Avril Lavigne .