monopoly much?

While last week’s rather toothless consent decree against Microsoft’s anticompetitive practices left many industry observers more than a bit disappointed, the furor has been compounded by a recent Microsoft SEC filing which adds real credence to charges that the company has unfairly leveraged their monopolistic dominance in one area (namely, OS software) to compete in other areas. According to the filing, Microsoft actually loses money in every single business in which they participate, except for the Windows and Office business areas, which show ridiculously high 86% and 79% profit margins respectively. In other words, allegations that Microsoft has artificially increased pricing in areas of monopoly to underwrite non-competitive entrance into other areas are apparently true. While Microsoft clearly disclosed this unusually detailed profit breakdown in an attempt to inoculate the company against Enron/WorldCom accounting practices problems, I’ll be curious to see whether their admission of this type of information will eventually prompt a reopening of the antitrust investigation.

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November 18, 2002

give me your fat, your lazy, your tubby masses…

New York is, from the perspective of the very lazy, truly an ideal city. No place else boasts such a wide array of services catered to those who can’t be bothered to get up out of their easy chairs. Jonesing for a few Big Macs? Don’t worry, because McDonald’s will deliever that fatty-fried “beef” directly to your front door. Out of toilet paper? Call from the john and the corner drug store can get TP into your hand by the time you’re ready to wipe. So perhaps it shouldn’t be overly surpising that it is in this environment that FreshDirect, the largest delivery-based grocery startup since WebVan’s calamitous disintegration, is being launched.

As much as I’d like to prognosticate the firm’s horrible impending failure, I’m actually oddly bullish on the company. I’ve bought my groceries from then for the past three weeks, and it seems to me the company hits the trifecta of requirements for consumer uptake (better quality food, at lower prices, more conveniently provided), all couched within a business model that is based on making rather than losing money on each delivery (leveraging both a rather cleverly technologized warehouse system and a slew of direct-purchase deals with food growers and makers which cut out the pricey distribution tier of middlemen).

FreshDirect’s currently running a “$50 of free groceries for new customers” promotion, so if you live in NYC, you might as well give them a whirl – with the amount we pay for anything in this city, any financial break is a welcome change. Just don’t throw out your Gristedes club card; my positive outlook aside, if these guys don’t build up a customer base quickly, you’ll once again be pushing the cart down the aisles yourself.

Update: Several readers have pointed out that Kozmo is perhaps a better failed dot-com comparison than WebVan, as Kozmo similarly leveraged New Yorkers’ sloth before plummeting out of business. FreshDirect, however, is largely immune to the main problem Kozmo faced: small orders (most Kozmo.com orders were for one or two, relatively inexpensive items). The markup on a single tub of Haagen Dazs isn’t enough to cover the cost of delivery; a cart full of groceries, however, grosses enough to work – hence FreshDirect’s $40 minimum.

Update 2: Several other readers have emailed to say they like to hand-pick fruits and vegetables themselves, something web grocery shopping doesn’t allow. I’d posit, however, that what those readers really mean is that they want their fruits and vegetables to be good – if the quality of the food delivered is high enough (fruit that’s large, mildly under-ripened and completely free of bruises, for example), people are largely just as happy as if they did the picking themselves. Because the FreshDirect warehouse is catered to the food rather than to the shoppers (foods are kept in ideally climate and moisture controlled rooms, and aren’t roughly piled and frequently handled, as in supermarkets), pretty much all of the produce I’ve had delivered is at least as good as what I could hand pick at Food Emporium or even the Amish Market.

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November 16, 2002

beep beep beep beep beep

While I’ve spent much of my time over the last six months boning up on film knowledge, I must admit I’ve been, until recently, slacking off on following the world of high tech. As a born-and-bred, died-in-the-wool geek, I simply assumed I could step down my daily dork-reading and still have a pretty good sense of the state of the tech industry.

Then, earlier this week, I discovered Ellen Feiss. The subject of one of Apple’s “Switch” ads, Ellen’s “is she stoned?” appeal launched a flurry of activity, from MetaFilter discussions to a slew of fan sites. In short, she’s become something of a web phenomenon. Which, while vaguely amusing, doesn’t perturb me in and of itself. What does bother me is that I’d never heard of Ellen Feiss until this week; yet she’s been a major meme for nearly five months.

Needless to say, I’ve been on Wired and Slashdot every morning since.

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Holy ill-informed digital rights policy, Batman!

This morning, taking advantage of another day at home, I worked my way through the pile of Daily Variety (the film industry’s trade rag) that had accumulated on my desk over the past few weeks. And, in particular, I was struck by the ever increasing number of film-industry-driven inane digital media bills, lawsuits and corporate initiatives that seem to have sprouted up recently.

As an industry member myself, I find it all a bit embarrassing. Isn’t there even one senior studio exec who remembers how ill-conceived this whole anti-tech song and dance was 20 years back, when the VCR was first introduced? At the time, MPAA prez Valenti testified to congress referring to the new technology as “the Boston Strangler of the American film industry,” apparently slightly underestimating video sales & rentals eventual role as a significantly larger revenue stream to the movie biz than theatrical distribution (video currently represents a whopping $16.9 billion market vs. box office receipts’ still quite healthy $8.4 billion). Undaunted by facts or history, Valenti’s doing it again, now painting digital technology as, I suppose, the “Washington Sniper of the American film industry.” Worse, he still seems to be receiving equally unanimous film industry support.

Of course, when I’m wearing my tech hat, chairing the newly formed Paradigm Blue foundation, I’ll be working hard to piss in Valenti’s eye, lobbying for more level-headed digital rights bills based on a better understanding of the underlying technologies and their likely consequences. But I’m a bit worried as to how whole-heartedly I’ll be able to throw myself into that task. Valenti and the MPAA have significant power over the other half of my professional life, providing the all-important G/PG/PG13/R movie ratings for Cyan’s films. And, similarly, I don’t want to piss off any studios to the point where they’ll be less likely to distribute something that Cyan produces.

Quite a dilemma, and one with rather significant impact on my professional life. For the first time, the whole Batman / Bruce Wayne secret identity plan is starting to make a whole lot of sense.

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October 26, 2002

‘glorification of the automobile’

Check out an exceedingly creative web app (though one, admittedly, of rather dubious utility): Lost in Translation. In short, the app uses BabelFish, AltaVista’s online translation engine, to translate strings of text back and forth between English and a foreign language ten times through. As anyone who has ever used an online translation engine might guess, the results are rather interesting. Observe these sample results:

Before: I’m a little tea pot, short and stout.

After: They are a small POTENTIOMETER, short circuits and a beer of malzes of the tea.

or

Before: A cookie is just a cookie, but fig newtons are fruit and cake.

After: Biskuit has expert of biskuit, but Newton von Fig is fruit and hardens.

Honestly, this thing could entertain me for hours.

Postcript: As BabelFish ghost-wrote the majority of my Italian papers while at Yale, this exercise greatly clarify my grades in that class.

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October 12, 2002

d.i.y.

Amazingly enough, the Verizon repairman did actually show up this afternoon. Unfortunately, the problem he diagnosed – a broken wall jack – was one he had come completely unprepared to fix. But, he assured me, he could be back with the requisite equipment by late this week – early next week at the latest.

Unwilling to wait, and dubious that he would make even that lengthy time frame, I ventured to the local hardware store, picked up an RJ-11 jack, and installed the damn thing myself. And it worked. Granted, it wasn’t rocket science. But it was the first repair project I’ve pulled off in this apartment (beyond assembling furniture and changing light bulbs), and I was hit by a sort of pride of ownership (or, more accurately, rentership). I now have a stake in the place. I’ve pried a chunk out of the wall, messed around with the wires contained therein, and reassembled the whole deal as good as new (more or less). Look out Bob Vila; there’s a new do-it-yourself guru in town.

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April 29, 2002

invisible technology breakdown

Within the world of tech thinkers, the distinction between visible and invisible technology gets a lot of discussion. According to the dichotomy, visible technology is something we consciously think of as ‘high tech’ – say, a computer. Invisible technology – say, a phone – blends into the fabric of daily life to the extent we forget that there’s complicated science behind it. As they improve, technologies usually move from visible to invisible. Which, by and large, is a very good thing. One of the few downsides is that our tolerance for error decreases as invisibility increases. When your computer crashes, you’re expecting it to happen. When your phone crashes, you feel vaguely betrayed, as if the fabric of the modern world is slowly unraveling.

At least, that’s how I felt, when I picked up the phone this morning to find, not a dial tone, but a low pitched static hiss. In true tech-dork fashion, I went to work trouble-shooting for about 45 minutes, unplugging, replugging, switching phones, jacks and outlets, dialing in and trying to dial out. Eventually, I gave up, convinced that the problem would right itself given enough time (it’s a phone – how could it possibly not just plug and go?), and headed off to a brass quintet rehearsal.

I returned four hours later to find the problem the same as before, and broke down and called Verizon. Supposedly, supposedly, they’ll be around to fix the problem tomorrow afternoon, but given my past experiences with the company, I’m not holding my breath. And, of course, my trusty cell phone, which gets nearly flawless reception everywhere else in Manhattan, is patchy at best up here in my apartment.

Fine. I didn’t want to talk to anyone, anyway.

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April 28, 2002

rfid update

A few weeks back, I fawned over what I saw as an important trend: RFIDs (radio frequency identification tags) in the supermarket. Since then, a variety of readers have pointed me towards breaking RFID news, the most exciting of which includes:

Wal-mart has begun testing RFIDs in a pilot program at the Tulsa, Oklahoma Sam’s Club (the pilot covers all Bounty paper towels, Mach 3 razors and cases of Coca Cola sold through the store). The company is using the tags to track everything from supply chain inventory and shipping, to on-shelf product availability and check out. As the prices of tags drop, Wal-mart hopes to quickly scale up throughout the entire firm.

To help push down those prices, Alien Technologies has created a new process for building RFID tags: fluidic self-assembly creates very small RFIDs (as tiny as a millimeter square) for a fraction of the cost of current tags (under 5 cents, versus today’s 50 cents).

Demonstrating another of RFIDs many potential uses, Invensys, which builds the controls for GE, Maytag and Whirlpool appliances, has begun testing the use of RFIDs in lieu of washing instruction labels in clothing. A ‘smart’ washing machine could read the tags of all the laundry in the load, then optimize water temperature and spin cycle for the best possible wash.

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April 22, 2002