Amazon EC2 is a hyped technology that is actually exceeding it's expectations. It's cloud computing, and when Amazon added recent features to enable datacenter level fail-over and cluster tools, it became the best way to scale any large internet service.
It now has over 60,000 customers, some using thousands of instances of virtual hardware. Combined, they use more bandwidth than all of Amazon.com. Companies like RightScale are examples of a blossoming 3rd party support and service eco-system growing around EC2.
Google is attempting to do something similar with Google App Engine, and Sun and IBM have cloud models as well.
But Amazon EC2 doesn't do Windows. You can't run the Windows stack on it (at least in any real way). You can run Linux, FreeBSD, Solaris and almost any other Unix you can name. But no Windows. Windows is gonna fall further behind as the internet infrastructure shifts to cloud models.
Windows isn't Cloudy.
In short Google shows that it's not doing anything to justify Facebook's holier-than-thou attitude. (Ever see how Facebook collects you Gmail contacts if you let it, or perhaps you recall Facebook Beacon on initial launch?).
Upshot: Google is revealing Facebook's hypocrisy, and doing it with the panache of Dan Akroyd finishing a faux-debate with Jane Curtain: "Jane, you ignorant slut."
Now that's proper use of a corporate blog in my book!
"Of the three major search engines, only Microsoft’s Live.com – if you want to call it a major search engine – returns much worse results..."
-- Philipp Lenssen, Google Blogoscoped
Why are all the apps on Facebook trivial, crappy or spammy?
Facebook originally launched the app platform with a lot of talk about how to create value out of the social graph.
Why hasn't that happened, with all the energy being spent on developing Facebook apps? Ben Rattray has a good answer - mainly because the structural incentives are all on creating virality.
The reason there are few and little use of utility-based applications is not because users don't want to use them or because app developers don't want to develop them, or even because Facebook doesn't want to encourage them (which they clearly do). It's because the means of distribution inside Facebook are structurally biased against them.
[I]t is very difficult to achieve a viral coefficient of over 1 through word of mouth. Ironically, this difficulty is compounded inside Facebook because the proliferation of viral action apps inundates users with invitations and makes them less and less likely to accept anything – including invitations to utility-based applications. So the barrier for going viral increases even further
Ben also categorizes the kinds of apps that could be useful, and which ones make sense on a social platform. It's very useful to look at - if you are thinking of how the web will be shaped by increasing adoption of "social" techniques into websites.
Of course there are more types of apps, and the list of examples is thin, but it's useful to think about if you plan to adapt to the ever-increasing "socialness" of the web.
Malcolm Gladwell reports that Nathan Myhrvold assembles geniuses to create inventions, and it's working like crazy.
But then, in August of 2003, I.V. held its first invention session, and it was a revelation. “Afterward, Nathan kept saying, ‘There are so many inventions,’ ” Wood recalled. “He thought if we came up with a half-dozen good ideas it would be great, and we came up with somewhere between fifty and a hundred. I said to him, ‘But you had eight people in that room who are seasoned inventors. Weren’t you expecting a multiplier effect?’ And he said, ‘Yeah, but it was more than multiplicity.’ Not even Nathan had any idea of what it was going to be like.”
The original expectation was that I.V. would file a hundred patents a year. Currently, it’s filing five hundred a year. It has a backlog of three thousand ideas. Wood said that he once attended a two-day invention session presided over by Jung, and after the first day the group went out to dinner. “So Edward took his people out, plus me,” Wood said. “And the eight of us sat down at a table and the attorney said, ‘Do you mind if I record the evening?’ And we all said no, of course not. We sat there. It was a long dinner. I thought we were lightly chewing the rag. But the next day the attorney comes up with eight single-spaced pages flagging thirty-six different inventions from dinner. Dinner.”
I can believe it because this is how I feel about the internet - there are still millions of great ideas out there, waiting to be implemented.
Even Bill Gates is impressed by these guys - which partially explains why Microsoft is stalled. Microsoft's muse is simply more excited by other stuff...
Bill Gates, whose company, Microsoft, is one of the major investors in Intellectual Ventures, says, “I can give you fifty examples of ideas they’ve had where, if you take just one of them, you’d have a startup company right there.”
There’s this idea they have where you can track moving things by counting wing beats. So you could build a mosquito fence and clear an entire area. They had some ideas about super-thermoses, so you wouldn’t need refrigerators for certain things. They also came up with this idea to stop hurricanes. Basically, the waves in the ocean have energy, and you use that to lower the temperature differential. I’m not saying it necessarily is going to work. But it’s just an example of something where you go, Wow.”
If you want to see what a good old-fashioned internet rant looks and sounds like, Joel Spolsky unloads it for you.
He's talking about Microsoft, Ray Ozzie and Live Mesh. It's important to note that Joel used to work at Microsoft, and contributed to what I consider the single greatest app of the PC era: Microsoft Excel.
As you read through the crescendo of angst at Microsoft's over-engineered cluelessness, be sure to note the tell-tale long sentences at peak rantage. You can feel the pounding that the keyboard took when this was typed:
It's a whole goddamned architecture, with an API and developer tools and in insane diagram showing all the nifty layers of acronyms, and it seems like the chief astronauts at Microsoft literally expect this to be their gigantic platform in the sky which will take over when Windows becomes irrelevant on the desktop.
And later, more unimpeded flux from the keyboard:
It sort of bothers me, intellectually, that there are these people running around acting like they're building the next great thing who keep serving us the same exact TV dinner that I didn't want on Sunday night, and I didn't want it when you tried to serve it again Monday night, and you crunched it up and mixed in some cheese and I didn't eat that Tuesday night, and here it is Wednesday and you've rebuilt the whole goddamn TV dinner industry from the ground up and you're giving me 1955 salisbury steak that I just DON'T WANT.
Stick around for the end, cause Joel gives bonus ranting, and targets Google...
Mary Jo Foley nails why Microsoft is continuing to decline.
Foley: There's always been this dichotomy between "Bill's guys" and "Steve's guys." Steve's guys have MBAs and their roots are in sales. Bill's guys have been traditional technologists. The people who are more like Steve will probably get more power and will run the show, so I wonder who's going to be the tech champion for Bill's guys. I think that's going to be a big cultural and noticeable change once Gates is out from his day-to-day duties.
This effect has been going on for the last 3 years and has ruined Microsoft's future: over-dependence on MBAs, and loss of technology touch.
It's nice when someone as smart & connected as Foley says things you've always believed...
Marc Andreessen has a post praising dual-class stock structures. To me this means he's recommending that public tech companies create shares that enable management to control the voting rights of the company, even though they may own a minority of the shares.
His post is extensive, and he admits he's going over to a new view (previously, he believed in the corporate version of one man / one vote). However, I think it's crazy talk and unsupportable with the arguments he's making. I think the downsides and unintended consequences are far worse than he admits.
Andreessen spent the last half of 2007 posting a lot of sarcastic notes on how Wall St. bankers and corporate titans were basically lying about their exposure to over-leveraged debt & derivatives. He reveled in exposing these guys.
In short, the problems for Wall St. were caused by excessive leverage.
Now, Pmarca is arguing that to fight potential raiders, hedge funds, private equity and other Schumpterian-type attacks, Silicon Valley should adopt the same techniques.
I.e. they should LEVERAGE their stock voting power. Basically, give insiders stock that is 10-100X more voting power than what they sell to everyone else.
The keystone of his argument is that Google does this.
He proposes the following four "commitments" that should make it OK for tech companies to operate this way:
- The key leaders of the company -- typically the founders -- who will own the controlling Class B shares, are also major economic shareholders in the company. They own a significant portion of the company and are therefore highly incented to maximize the value of the company over time.
- The key leaders of the company who own the controlling Class B shares have a long-term goal of building a major franchise, and the commitment required to execute against that goal.
- The controlling Class B shareholders have a commitment to treat Class A shareholders fairly and equally in all respects other than voting power.
- All public shareholders understand what they are getting into up front -- no bait and switch.
I think all four of these are impossible to hold management to, and about as likely to be judged in good faith as a politician's campaign promises.
Seriously, can Andreessen name ANY Silicon Valley founder who wouldn't believe that they would be able to satisfy all four of these "commitments"? Remember to ask them this at the time they are about to go public.
At a simple level, once most founders companies' go public, they have more frickin' money than god, and are not really that incented to maximize the value of the company. Is Filo that excited to do that (would he really know how?), or would he rather spend his days reviewing hardware purchases of Yahoo's teams?
As Bud Fox once said: "How many yachts can you waterski behind?"
Citing Google and Buffett as the "good" users of dual class structure is like citing Michael Jordan and Kobe Bryant as good examples of why a kid should leave school early to pursue his NBA career - "Hey, it worked great for those two!"
Rather than go with Buffett, I'd lean towards Peter Lynch for the guidance: "Go for a business that any idiot can run - because sooner or later, any idiot probably is going to run it." Should those idiots have this leveraged control?
Should Terry Semel (who made about $500M from Yahoo in 4 years) really have had this kind of control?
For 95% of tech companies, which is more likely?
And really, are investors going to understand the implications of dual-class structures? Should they have to?
Andreessen is arguing for a great weakening of already weak corporate governance.
Would it have been good for Yahoo to have such a class structure? I don't know, but I'm sure Yahoo would have judged itself to pass with flying colors on all four commitments.
In fact, I'd argue that Yahoo is proof that companies don't really need the dual class structure to achieve control. They can simply do what they've always done and pack the board with yes-men and women who couldn't care less if the founders were presiding over a controlled flight into ground.
My belief is that this technique will become more common, and will hurt innovation in Silicon Valley more than help it. In general, the companies that do go public with this type of structure will look more like European companies of the late '80s and '90s, where management had almost no incentive to govern the company for anyone's benefit but their own.
And yes, the argument that Wall St. forces some companies to focus on the short term too much is true, but that doesn't mean founders should concentrate control so drastically. If the founders are magnanimous enough to be able to handle Andreessen's four "commitments", I'd think they'd be bright enough to run their franchise effectively without dual-class controls. After all, it has been done many times - eBay, Cisco, Oracle and many others seem to have done it.
Dual class structure would be an easy way out, and wouldn't promote healthy governance. It'd be yet more insulation from the real world for the management of most companies, and the temptation to abuse it would be huge.
I guess Andreessen doesn't think that Silicon Valley founders would be subject to that temptation, and they don't already derive enough benefits at the top of the tech-company pyramid.
Ask yourself: aren't their egos and wealth big enough already? Or do they need this leverage technique to compete with the East Coast mega wealthy in PE and on Wall St?
I don't think it'd be healthy to try.
Before making it easy for insiders to isolate themselves, I'd argue that if you want more public tech companies, and more innovation, make it easier to go public. Repeal big chunks of Sarbanes-Oxley (SarBox). I think that could help without weakening corporate governance too much.
If Marc wants to recommend this dual-class technique to Facebook, where he is apparently becoming a board member, I'd add one suggestion: Give the Class B power shares to all the employees and early investors.
Or, if that doesn't sound good - how about this: Stay private.
I rewrote searchamazonprime.com to make it better. It's designed to find products on Amazon.com that are eligible for Amazon Prime free shipping. To do this, it finds only products sold by Amazon.
The new site is redesigned to look better, and the back-end is much faster than the old one.
I've also added some nice features. It finds many more products than any other Amazon search site that I know of, and it shows them on one page.
There are sections of results by category, and you can hide categories you don't care about.
I wrote a spelling suggestion corrector based on product names. So now when you type in a misspelling or a typo, you get a suggested correction, like on Google.
Finally, you can now add searchamazonprime to your Firefox search bar. If you use the search bar in Firefox, you will get auto-completion style suggestions as you search.
It's really easy - and there's step-by-step instructions here.
So if you have Amazon Prime, or buy a lot of stuff from Amazon.com, try it out, and let me know what you think.
These cracked me up so much, I'm just gonna rip them right off Andrew's blog:
Here's Andrew's impersonation of John Battelle's Twitter stream:
Did you know the post office is selling stamps now for 41 cents that will continue to work after the rate goes up to 42 cents on May 12.
The cost of sending a first-class letter will rise by a penny, to 42 cents, on May 12. But the "forever" stamps -- currently selling for 41 cents -- will remain valid for full postage after the increase. The U.S. Postal Service estimates Americans are buying 30 million "forever" stamps a day.
Get some now and save yourself the hassle of dealing with the rate increase.