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

The latest survey finds that two-thirds of adults who download music couldn't care less about copyright laws, although the survey was done before the RIAA made public its intentions to sue the individuals who share music online (not the people who download that music) according to this AP story in the San Jose Mercury News. Maybe people feel it is payback time for having been forced to buy expensive ($14-18) CDs which only had one or two songs that were any good!

The survey published Thursday by the nonprofit Pew Internet and American Life Project estimated that roughly 35 million American adults use file-sharing software, about 29 percent of Internet users. Those figures were generally consistent with other estimates of 60 million American users across all age groups

...The survey said younger Americans, ages 18 to 29, were least worried about copyrights, with 72 percent saying they weren't concerned. It said 61 percent of Americans who were 30 to 49 years old were similarly unconcerned. Full-time students were the least concerned with violating copyright, with 82 percent saying they were not worried.

As if the wacky first few people intending to run for governor -- if CA Gov. Gray Davis is recalled -- wasn't enough, now Larry Flint, publisher of Hustler has also taken the initial steps to run (short of filing a number of signatures and/or a fee). According to this AP story in the San Jose Mercury News:

The registered Democrat, civil libertarian and free speech advocate said he'd solve California's budget woes by expanding slot machine gambling. His holdings include several casinos.

``California is the most progressive state in the union,'' said Flynt, 61. ``I don't think anyone here will have a problem with a smut peddler as governor.''

But the low- and mid-market sales continue at a crisp rate as low interest rates make higher prices affordable to the thousands who were priced out during the dotcom boom. According to this San Francisco Chronicle story yesterday:

Sales of luxury homes in the Bay Area dropped in the second quarter as the region's stumbling economy kept a cap on price appreciation, a real estate information firm reported Tuesday.

A total of 1,714 homes priced above $1 million were sold in the nine-county region between April 1 and June 30, down 3.5 percent from the peak 1,776 in the same period last year, said DataQuick of La Jolla (San Diego County).

Louis Borders, most famous for founding Borders books and the biggest dotcom failure Webvan, is now back with his newest content startup according to this San Francisco Chronicle story:

With KeepMedia, which started Monday afternoon, the sadder but wiser Borders is back in business with a more modest attempt to marry technology with the mass market, this time in a field that is littered with past failures: paid Internet content.

Borders said his new venture has the potential to be the "category killer" that Webvan never was. For a subscription fee of $4.95 per month, KeepMedia provides access to the archives of 140 magazines and some newspaper columns, going back 10 years.

AlwaysOn interviews Kleiner Perkins' VC extraordinaire Vinod Khosla on where technology and his investments are going:

I don't think the software business is over, but I think the economics are getting a lot more rigorous. If somebody provides a better return people will take it. And Salesforce.com has done that. At some point you run out of the number of people who need bigger IT systems because you've given one to everyone, and you also run out of new areas to create these [systems]. SAP created one and Siebel created another, and PeopleSoft created HR, and then maybe Ariba created a smaller segment.

But then you start getting to get the marginal categories. We saw that happen on the Internet. Jeff Bezos created an important category which is multi-billion dollars, and then people created all kinds of niches and pretended that they were huge. So, people take a successful model and keep replicating it, but the opportunity gets more and more marginal in that class. Eventually you get to the very marginal, and they're not important. So will there be more important software niches? Yes. Will there be huge ones? Might be. IT might be back in that class.

All factors indicated that Google will wait, as it has said, and not go public this year even as the tech stock market has had a solid rise this year according to this San Jose Mercury News story:

Like Netscape in 1995 and eBay in 1998, some believe that a blockbuster initial public offering of stock in the hot private company Google could lead to another IPO wave.

...So it's Google, backed by two high-profile venture firms, Kleiner Perkins and Sequoia, that observers are eyeing. Buzz on the street, though, is that the company won't go public until early next year, and that a host of other private companies in the valley are positing their IPOs for Google's frothy wake.

The latest numbers for advertising according to this article in Editor & Publisher:

Online advertising revenue is expected to rise 10% to $6.3 billion this year, according to the latest projections from Jupiter Research.

That growth will be fueled in part by the proliferation of paid-search advertising sales, which Jupiter predicts will skyrocket 50% to $1.6 billion in 2003

The most important development in the success of iTunes, Apple's new music downloading service, is that it allows music lovers to legally download single songs and put together playlists based on what they like and in the sequence they want to hear those songs. The day of the album is now history...Napster made that happen a few years ago!

Charles Haddad writing in a BusinessWeek story shares responses from numerous readers:

Maybe I was wrong. Maybe established bands such as Metallica should fear Apple's iTunes Music Store. Longtime Metallica fan Marc McCoy, a graphic designer in Pittsburgh, wrote me that he would have bought just two songs off the band's new St. Anger release rather than the whole CD if he could have. Writes McCoy gleefully, referring to the coming PC version of the music store: "When iTunes for Windows rears its head, we'll see who's in control."

Maybe we should be listening to the various analysts who're warning of a Wi-Fi bubble in a New York Times story when McDonald's jumps on to the Wi-Fi bandwagon according to this Wall Street Journal story (subscription required).

Wi-Fi is going to be ubiquitous. It is already at our home in Los Gatos. But soon it'll be available at all kinds of commercial establishments...and when one of those starts to offer it for free as a perk, how long will the others continue to charge for it? It'll be like the HBO of the last decade, when offering that premium channel was a big plus at hotels and motels across the country. Now? Every hotel had better have HBO! Same's going to be true for Wi-Fi in two years.

McDonald's move, part of a pilot program, is the latest attempt by a high-profile chain to capitalize on Wi-Fi, the wireless technical standard behind the increasing popularity of high-speed Internet access among laptop users on the go. Borders Group Inc., Starbucks Corp. and others have all begun to offer wireless "hotspots" in their outlets, giving patrons the ability to check e-mail or surf the net away from home or office.

...Many skeptics have questioned whether wireless providers and chain operators can ever hope to profit from Wi-Fi, especially a chain like McDonald's accustomed to fast customer turnover. But analysts including Gartner Inc.'s William Clark say restaurants are, in part, trying to use wireless to attract customers during off-peak hours and to get them to spend more on food.

Yesterday's San Francisco Chronicle story covers the potential Wi-Fi bubble that's continuing to build up:

...some analysts and investors are now questioning whether one key market for Wi-Fi, public Net access through hot spots at airports, hotels and coffee shops, is rapidly becoming a dot-com-style bubble waiting to burst, with service providers throwing far more money at expanding services than consumer demand will warrant anytime soon.

Some 4,500 Wi-Fi hot spots -- areas of up to 300 feet in radius within which subscribers with laptop and handheld computers can get broadband-speed Net service -- have been deployed across the United States, mainly in the last two years, according to Pyramid Research of Cambridge, Mass.

How did almost three weeks go by without my adding a post to my blog? Well, I had to after reading this New York Times op-ed piece by Thomas Friedman, "Is Google God?"

Says Alan Cohen, a V.P. of Airespace, a new Wi-Fi provider: "If I can operate Google, I can find anything. And with wireless, it means I will be able to find anything, anywhere, anytime. Which is why I say that Google, combined with Wi-Fi, is a little bit like God. God is wireless, God is everywhere and God sees and knows everything. Throughout history, people connected to God without wires. Now, for many questions in the world, you ask Google, and increasingly, you can do it without wires, too."

..."The key point is not just whether people hate us," says Robert Wright, the author of "Nonzero," a highly original book on the integrated world. "The key point is that it matters more now whether people hate us, and will keep mattering more, for technological reasons. I don't mean just homemade W.M.D.'s. I am talking about the way information technology — everyone using e-mail, Wi-Fi and Google — will make it much easier for small groups to rally like-minded people, crystallize diffuse hatreds and mobilize lethal force....

A growing breed of sites with names like ShopInPrivate.com, Discreet Shoppers and HardToBuy.com that let you buy the things you're too embarassed to buy at the local drugstore according to this Wall Street Journal story (subscription required):

[ShopInPrivate's] Mr. Nardone believes shoppers are worried about buying "I'm a loser" products in public. "The person has to accept the embarrassing health condition they may have before they'll have the courage to bring a product up to the counter."

...While a handful of small Web stores vie for consumer dollars, they are dwarfed by Drugstore.com. The online drugstore giant had net sales of $57.1 million in the first quarter.

Drugstore.com, Bellevue, Wash., opened in February 1999. The site now boasts more than 2.8 million customers. Walter Conner, senior communications director, recounts a nightmarish commercial from the company's early days: A clerk over a loudspeaker calling out a price check on condoms.

In a first for professional sports leagues -- which so far have sold highlight packages etc. on videocasette, DVD or via streaming -- MLB.com (owned by all the major league teams) will begin to sell the entire game on video via the Web. So anyone can now download the play by play account of the whole game thanks to the dramatically reduced costs involved. Basically, it is bandwidth that MLB.com has to pay for...and I'm sure they're hoping to sell lots of other things to customers once they have them on the site. According to this Wall Street Journal story (subscription required):

The $3.95-per-game service on MLB.com got a trial run on Thursday, with video of the Houston Astros' no-hitter -- using a record six pitchers -- of the New York Yankees the night before. As of late Thursday afternoon, 201 fans had bought this game, according to the site. The service, called Digital Classic, will be offered again when the Yankees' Roger Clemens notches his 300th victory, which could come as soon as Friday against the St. Louis Cardinals. (Fans can pay in advance for the Clemens game, and then be e-mailed when he wins; around 190 fans had done so by late Thursday afternoon, according to the site, with limited promotion.)

FormFactor is the first technology company in six months to decide to go public according to this San Francisco Chronicle story:

FormFactor, a maker of semiconductor testing equipment, said Wednesday that it has increased the size of its initial public offering, signaling that Wall Street may have regained its appetite for new issues.

...FormFactor reported a profit of $699,000 on revenue of $18.7 million in the first quarter ending March 29. Last year, during the first quarter, the company's profit was $846,000 on revenue of $17.3 million.

Finally, someone explaining why SF doesn't have more cafes and restaurants with sidewalk tables. Cafe Flore, one of my favorite cafes in the city, just changed ownership much to most of the loyal following's trepidation since Ahmed had owned it for over 25 years. But one of the first moves the new owner made was to add tables to the sidewalk outside on Noe Street -- an amazing, great change, especially on weekends when it used to be overwhelmed with people. According to this San Francisco Chronicle story:

Until 1993, getting a street-use permit had no formal process at all, and so it was virtually impossible for a café owner to make his outdoor dining legal.

"It was very hard to get a permit, because we dealt with each permit on an individual basis," explained senior plan checker Nick Elsner, who has been with the City's Department of Public Works (DPW) for 19 years. "Permits would get passed around to different agencies, get lost on people's desks. Planning had to look at it; Traffic had to look at it." But 10 years ago, all the agencies got together with local merchants and created a formal process Elsner says has grown increasingly efficient. "Now, we have a two-hour turnaround getting feedback from the Planning Department, telling us whether this is an establishment that has the right to put tables and chairs on the sidewalk or not."

Several companies have recently raised venture money with multiple offers on the table according to this San Jose Mercury News story which features Scalix, which provides a Linux-based email platform:

Most people think it's tough now for entrepreneurs to get money. But if you have the right experience, and a good idea, venture capitalists will fight to give you their money -- and even shower you with gifts to make sure you take it.

...But hot ones get wrapped up in little more than a month. New Enterprise Associates calls the process of wooing a hot company ``love bombing.'' Partner Stewart Alsop said he ``bounced around in his chair'' when Farris called him April 10 to tell him about Scalix.

...He delivered a bottle of 2000 Rochiolli Pinot Noir -- from his personal collection -- to Farris' doorstep on April 24, the day he delivered his written offer to invest. He then dropped by the Mayfield Fund, and delivered a present to Allen Morgan, the partner who helped incubate Scalix in Mayfield's basement: a bottle of Knob Creek bourbon, Morgan's favorite. As an existing investor, Morgan would play a key role in deciding. To top it off, Alsop bought Farris dinner at the well-known Bacchanal restaurant.

According to this New York Times story (registration required):

Yet, while nearly three-quarters of the nation's households belong to rewards programs of some kind, according to the consulting firm Forrester Research, most of them do so only offline, because such offerings have been slow to emerge on the Web. That is now changing, though, as some of the Internet's biggest companies — including eBay, LendingTree, USA Interactive and the music-sharing system KaZaA — are turning their attention to loyalty programs.

"With the land grab for online customers winding down, it's time for Internet retailers to shift their efforts to customer retention," said Carrie A. Johnson, an analyst with Forrester Research. "Rewards programs are one way to do that."

How one entrepreneur cashed in on the short Iraqi war according to this New York Times story (registration required):

As he tapped out an e-mail message early one Monday morning in April, Zac Brandenberg had no idea the kind of success he would achieve. At 2:30 a.m. he pushed a button on his keyboard, sending two million copies of the message scampering across the Internet imploring their recipients to "Get the `Iraqi Most Wanted' Deck of Cards!"

...Hundreds of millions of e-mail messages about the cards have been sent since, and some 1.5 million decks have been sold by GreatUSAflags.com, a Web site owned by JDR, based in Los Angeles, and its partner, Lionstone International, which is based here. Other companies have sold a total of more than one million decks, making the Iraqi cards one of the fastest-selling fad products in history.

With the Barbara Walters interview with Senator Hillary Clinton (her new book is Living History), airing last night, a cover story in Time magazine, and numerous other media ops, Senator Clinton is back in the limelight with vengeance according to this New York Times story (registration required):

"Look at what she has done in this one weekend," said Phillip Friedman, a Democratic strategist in New York. "She has commanded more attention than the nine Democratic presidential candidates combined, she has given her version of a scandal that involved her family, and she has begun to move on to a posture as a national leader in the party."