Ready, Fire, Aim! - Mihail's Public Blog

Wall Street Journal reports (subscription required):

Private-equity and venture-capital investment world-wide fell nearly 50% in 2001, but the volume in the Asian-Pacific region slid only 3.5%, according to a new report, the authors of which see Asia continuing to outperform other regions in 2002.

The annual report by London-based venture-capital firm 3i Group and PricewaterhouseCoopers put total global private-equity investment, including spending on company buyouts and restructuring, at $100 billion last year, compared with a high of $199 billion in 2000. In the Asian-Pacific area, the 2001 figure was $11.9 billion, compared with $12.33 billion the previous year.

Wall Street Journal story (subscription required) on product placement in the Bond films and how they've influenced America's drinking habits.

About half an hour into "Dr. No," the very first James Bond film in 1962, Sean Connery's Agent 007 gets a medium-dry vodka martini -- shaken not stirred, of course -- delivered to him in his Jamaican hotel. Historians of the spirits industry consider that drink to be a flash point in America's transition to mixing martinis with vodka rather than gin.

..."Die Another Day" represents a substantial opportunity for Finlandia, a relatively small brand in the U.S., to convert some Bond fans from Smirnoff to Finlandia. With 1.6 million cases shipped world-wide in 2001, Finlandia is the second-largest super premium vodka in the world behind Absolut. Since 1996, the vodka's growth has also been primarily in the U.S. Still, it had less than a 1% share of the U.S. vodka market last year, while Smirnoff had a 16% share.

The switch in the U.S. to vodka from gin began after World War II and gathered momentum through the 1960s, says Paul Pacult, managing director of Spirit Journal Inc., an alcohol beverage consulting and publishing concern.

Meanwhile, Bond creator Ian Fleming, an intelligence agent in Moscow in the 1930s, had developed an affection for Russian vodka. Later, when he discovered American martinis, he combined the two, according to John Cork, author of "James Bond, the Legacy: 40 Years of 007 Films," who adds that "James Bond probably did more to popularize the vodka martini itself than any other single factor."

In "Die Another Day," Mr. Brosnan sips his martini with Ms. Berry in the ice palace, a key setting of the film. The name "Finlandia" is never spoken, but Mr. Bond, with one hand in the pocket of his trademark black tuxedo and the other hugging his martini glass, stands in front of a chiseled ice bar stacked with Finlandia bottles.

Ray Lines, founder of Utah-based CleanFlicks, is quoted by the Wall Street Journal (subscription required) as saying "All we're talking about here is choice." Is it just about that? Choice, golf clubs, freedom of editing? The legal issue may boil down to whether editing these films, or making the software that changes these films, violates the "derivative work right" of copyright holders to control the making of related works.

The big Albertson's Inc. grocery-store chain this summer began renting so-called e-rated videos -- edited without filmmaker permission -- in most of its 46 Utah stores. A Utah-based software start-up, Trilogy Studios, just introduced a product that lets home-video users excise a variety of unwanted scenes on their computer, using the company's preprogrammed edits.

..."I can go into Wal-Mart, buy a set of golf clubs and paint 'em a different color, and nobody cries about that," says Mr. Lines. "This is America."

Movies aren't golf clubs, filmmakers say. The Directors Guild of America, based in Los Angeles, is exploring legal action to halt the editing operations. Materials announcing a suit, including outraged quotes from big-name directors like Martin Scorsese and Mr. Spielberg, were mistakenly posted on the guild's Web site last month and quickly taken down. DGA Executive Director Jay Roth says all the editing operations likely violate copyright laws.

I mentioned this here when I saw the incorrect Wired story about "Our Product is like Software Pasties"

According to the Wall Street Journal (subscription required):

Intelligence agencies were aware of numerous threats that terrorists might use airplanes as weapons against the U.S., despite government claims following Sept. 11 that the World Trade Center and Pentagon attacks came like bolts from the blue.

...For example, the report detailed examples of intelligence showing Osama bin Laden intended to carry out a strike inside U.S. borders, including an August 1998 report that "a group of unidentified Arabs planned to fly an explosive-laden plane from a foreign country into the World Trade Center." The Federal Bureau of Investigation relayed the information to the Federal Aviation Administration, which deemed the plot unlikely, the report said.

Former Vice President Al Gore will deliver a major foreign policy speech addressing our current tensions with Iraq and the War on Terrorism.

Monday September 23

11 a.m., Registration | Noon, Program

Gold Room, Fairmont Hotel
950 Mason Street (at California), San Francisco

$15 for members, $30 for non-members

For reservations call 1.866.468.3399 or register online

William Faulkner said, "the young writer is … demon-driven and wants to learn and has got to write he don't know why, he will learn from almost any source that he finds. He will learn from older people who are not writers, he will learn from writers, but he learns it."

It accomplishes its goals by choosing three noted writers of fiction each year to select the winner and four runners-up of the PEN/Faulkner Awards for Fiction; by presenting a series of readings by noted writers of fiction at the Folger Shakespeare Library and other venues; and by sponsoring the Writers in Schools program in which the authors in the reading series teach classes in Washington public high schools.

When William Faulkner won the Nobel Prize for literature in 1950, he gave a speech memorable for its insistence on the survival of all that is noble in the human spirit, especially the talent and inspiration of the writer. Then he gave away the prize money to establish a fund to support and encourage new fiction writers.

The PEN/Faulkner Award for Fiction is the successor to William Faulkner's generosity. It is an award designed to be independent of the demands of the publishing industry, free from all constraints of sales and marketing, free to flow from the judgment of a writer's peers.

It was quite an amazing collection of smart, talented people at the Grotto event last night. However, Indian-American Muslim Samina Ali especially stole the show with her gripping, powerful, emotional short story about/around the birth of her child, Ishm, who turned 3 years old yesterday. Ishm had taken over the large terrace and celebrating his birthday with over 300 of the Grotto and Samina's fans. The story was written by Samina especially for the Grotto evening at the request of Bronson who organized the event around the theme "The One."

Watch for her novel, Madras on a Rainy Day, that'll be published by powerhouse Farrar Strauss & Giroux in 2004. You can also catch Samina in December at a reading. I will for sure!

One interesting thing about the writing community here as I was discussing with Samina is that unlike LA and New York, it is not as professional -- I don't mean this in a necessarily negative way. I just mean that the writers here don't seem to know the reality of the publishing world -- the necessity of having an agent, of trying to sell a book before you've written 500 pages (like one young writer confided) and what it takes to get published. Maybe San Francisco is a training ground for writers trying to figure it all out and then if they're really serious, many if not most will leave for the big city.

The search for San Francisco's creative community ended yesterday evening. I was blown away by the San Francisco Writers Grotto's Grotto Nights event organized by Po Bronson et al at the San Francisco Public Library.

Thanks to Julie Landry who's Bogging Network blog Big Ideas is so beautifully written for introducing me to this event and who was there with her good friend, June. Mike Thomas who writes the hysterically funny Blogging Network blog Open Mike showed up, too, and we all had a great time at the After Party at the Grotto headquarters on Fell Street...at the old Dog and Cat Hospital Building.

San Francisco tends to be a very fragmented city when it comes to the creative community. While every cafe seems to be filled with writers or artists etc.-- such as the talented Bill Quick writing his blog from a WiFi wired cafe yesterday after we met at a new Hayes Valley spot -- it can be really hard to find a critical mass anywhere.

Circuit City  reported Wednesday, according to the Wall Street Journal, that its net income increased 34% for its second quarter due to higher sales and profits from its stake in the used-car megamart CarMax.

Revenue increased 9.9% to $2.22 billion from $2.02 billion, helping to offset remodeling costs that doubled to eight cents a share in the latest quarter from four cents a share a year earlier.

Circuit City Group is the electronics-store chain of Circuit City Stores Inc., which isn't publicly traded. The parent company also has a separate tracking stock for CarMax, which it plans to split off on Oct. 1.

Radio Free Blogistan has several posts related to yesterday's Berkeley panel on weblogs. If you have any interest in the panel participants' and audience members' observations then this is the blog to check out since it has got links to everything out there on the panel.

Among other posts, it includes some choice comments from the panel and audience such as Rebecca Blood saying "I've never considered myself a journalist" and yours truly making the following observation:

"I've stopped reading newspapers, but Nick Denton's blog ... business and tech ... makes me read more than i used to."

Mihail S. Lari (founder of the Blogging Network, from the audience)

I'm looking forward to Radio Free Blogistan's notes on the panel since I was sitting behind Christian Crumlish (did I get the name right?) and he was taking incredibly detailed notes! So I stopped trying to write down everything and just listened to the panel which was interesting but left a few important things unsaid such as answering the question about the economic model behind blogging -- which Blogging Network is addressing quite effectively.

I just got back an hour ago from the UC Berkeley panel, Weblogs: Challenging Mass Media and Society with Blogger founder Meg Hourihan, San Jose Mercury News columnist Dan Gillmor, author Rebecca Blood et al. This evening's panel was moderated and organized by Assistant Dean Paul Grabowicz who is Director of the New Media Program at UC Berkeley's Graduate School of Journalism.

More details and observations about the panel to come in the morning. Good night!

The $2.5 million that Mr. Welch estimated he would pay annually may be far less than the actual cost to G.E. to provide those services because of government rules on how to value perks. For example, under federal rules, it would cost an executive less than $500 to take a corporate jet from New York to Paris on vacation, but the flight would actually cost shareholders at least $15,000.

And there may never be any disclosure to shareholders of just what these perks cost because S.E.C. disclosure rules do not apply to retired chief executives...John Coffee, a securities law expert at Columbia University, said the Welch case illustrated how an S.E.C. rule limiting disclosure of executive perks to "incremental cost" — how much extra a company pays for a given benefit — had been stretched "by very sharp corporate lawyers who have taken a small exception and turned it into a huge loophole."

He said many companies were using the "incremental cost" rule to hide the true cost of perks. "If the C.E.O. has a masseuse, they will tell you the person was on the staff anyway so there was no incremental cost," Mr. Coffee said.

Mr. Coffee said Mr. Welch's perks show how even when there is no hint of fraud, the disclosure rules do not serve shareholders well.

Charles Simonyi, a computer scientist who joined Microsoft when it had 40 employees and held the title of Chief Architect until a few years ago is leaving to start his own startup, Intentional Software. At Xerox PARC, Simonyi developed Bravo, a pioneering graphical text-editing program, that became the basis for Microsoft Word.

Mr. Simonyi's departure, to be announced today, will leave Microsoft with only three senior people from the team that led the company in the early 1980's: Bill Gates, a co-founder and the company's chairman; Steven A. Ballmer, the chief executive; and Jeffrey S. Raikes, a group vice president...

Mr. Simonyi has left Microsoft with the right to use the intellectual property he developed and patented while working there. And Microsoft holds a right to be the first to negotiate with Intentional Software if the company comes up for sale.

A new, younger generation of innkeepers is muscling its way (subscription required) into the sleepy $3.5 billion B&B business with its own ideas about lodging. At a host of new and newly owned inns, they're replacing traditional decor with post-modern rooms, swapping afternoon tea for Internet access, and taking a pass on socializing with their guests. In short, they are tinkering with a formula that has served B&Bs for ages. "You might as well strike the 'breakfast' out of 'Bed and Breakfast,' " says Richard Gordon, an inn inspector based in Providence, R.I.

Young innkeepers are taking over B&Bs in record numbers, with a quarter of inns now run by under-40 owners, according to a survey by BedandBreakfast.com. That's up from 9% in 1997. Brash and creative, these new owners say the industry needs to become more kid-friendly and play down the schmoozing with hosts and fellow guests. "People my age don't want to stay at some place that looks like their auntie's," says innkeeper Drew Ogle. His B&B, Christopher Place Inn, features "theme" rooms ("Camelot" and "The Secret Garden") and lets guests show up in bathrobes at breakfast.

That's nothing compared to the Villa at Saugerties, N.Y., where the rooms feature stark, minimalist decor, and 28-year-old innkeeper Aimee Szparaga has been known to greet guests in a bikini. "I see a blurring between the B&B and the boutique hotel," she says.

Newfangled or not, the bed-and-breakfast has become a tempting business for young entrepreneurs these days. There are nearly 30,000 B&Bs in America -- more than all the Hiltons, Hyatts and Holiday Inns combined -- and the industry has been steadily growing for decades. In all, it's projected to grow by about 4% this year, compared with the hotel industry's anemic 1.6%.

Indeed, since Sept. 11, hotels and motels have been much harder hit than these smaller rivals, which don't depend as much on business travelers. Innkeeping is "almost recession-proof," says hospitality analyst Robert Mandelbaum of Atlanta's PKF Consulting. In hard times, these owners can always cut back on staff and do more work themselves, or simply "put a couple less bacon slices on the plate," says Jerry Phillips, executive director of the Professional Association of Innkeepers International. That flexibility and security appeal to thirtysomething refugees from recent corporate upheavals who want more control over their lives.

In today's Wall Street Journal (subscription required), Jack Welch writes a signed essay:

I'm not going to get into a public fight refuting every allegation in that filing. But some charges have gotten a lot of media attention. So, for the record, I've always paid for my personal meals, don't have a cook, have no personal tickets to cultural and sporting events and rarely use GE or NBC seats for such events. In fact, my favorite team, the Red Sox, has played 162 home games over the past two years, and I've attended just one.

But these things are not the issue. How to deal with my employment contract is what creates a dilemma

...To some, changing the contract may seem like an easy decision. However, changing it could raise the possibility that something about it was improper.

And, others might say, "Why didn't you bring this up before it was in the papers?" The simple truth is: There was not a single day in the past six years that I thought it was improper, and I don't believe it is improper today. I was given extra compensation for remaining at GE until I was 65 -- compensation which would be delivered in-kind post-retirement, rather than a much greater payment in cash pre-retirement.

America Online is the largest Internet provider in the world with 35 million subscribers but most of its users get online via slow dial-up Internet connections (subscription required).

Next month, America Online, a unit of AOL Time Warner Inc., will begin offering for the first time a completely retooled version of its online service that is specifically designed to run on broadband Internet connections. The new version of the service has players for full-motion video and compact-disc-quality music built into it, so users won't have to click on a separate "media player." It also will have more so-called appointment viewing, with televisionlike shows such as "Broadband Rocks," which will feature behind-the-scenes footage from rock concerts every Friday afternoon.

To help promote broadband connections, America Online also has quietly begun allowing multiple users to be online at the same time. Until now, every America Online account could have as many as seven users but only one of them could be logged on at a time. Now, America Online will allow all seven users of one account to be online at the same time if they are on a high-speed Internet connection.

President Bush's chief economic adviser estimates that the U.S. may have to spend between $100 billion and $200 billion to wage a war in Iraq, but doubts that the hostilities would push the nation into recession or a sustained period of inflation.

Lawrence Lindsey, head of the White House's National Economic Council, projected the "upper bound" of war costs at between 1% and 2% of U.S. gross domestic product. With the U.S. GDP at about $10 trillion per year, that translates into a one-time cost of $100 billion to $200 billion. That is considerably higher than a preliminary, private Pentagon estimate of about $50 billion.

In an interview in his White House office, Mr. Lindsey dismissed the economic consequences of such spending, saying it wouldn't have an appreciable effect on interest rates or add much to the federal debt, which is already about $3.6 trillion. "One year" of additional spending? he said. "That's nothing."