Slashdot Mirror

You are so full of dick-sucking bullshit that it is spilling out through your keyboard. The WTO has ruled against the USA, just recently in fact. See the case of steel tarrifs in which the EU won and the USA lost.

Furthermore, the existence of a few restrictive policies like the blocking of Mexican commercial truckers does not mean that NAFTA is not favorable for Mexico. Here's the way it works, NAFTA sucks for poor Americans because jobs for unskilled labor goes south, NAFTA is reasonably good for upper-middle to upper class Americans because they can buy goods cheaper and think they are immune to their jobs going south. NAFTA is pretty good for rich industrial Mexicans because they get to sell their product to the US market with relative ease. NAFTA is somewhat good for the poor Mexicans who can now get jobs that pay very well compared to other jos in the local economy but the cost for them is sweat-shop like conditions.

"For instance, Microsoft, the world's most valuable company, declared a profit of $4.5 billion in 1998; when the cost of options awarded that year, plus the change in the value of outstanding options, is deducted, the firm made a loss of $18 billion, according to Smithers."

should also have mentioned that Wikipedia has a whole article on Slashdot Subculture where n00bs like me cut our teeth. Plus The Economist mentions Wikipedia as a successful example of Open Source in this already slash-dotted article

Dear Economist Troll,

What you're doing is wrong, but I think I love you. A few people on Slashdot made references to Cassini using something called 'convolution coding' in a previous article's comments, and I didn't know anything about what they were talking about - but now I know.

I think I'm going to have to get a subscription to the Economist now...

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Coding theory

Not the usual channels

Jul 1st 2004
From The Economist print edition

[Image]

How to transmit information reliably

ON JULY 1st, a spacecraft called Cassini went into orbit around Saturn--the first probe to visit the planet since 1981. While the rockets that got it there are surely impressive, just as impressive, and much neglected, is the communications technology that will allow it to transmit its pictures millions of kilometres back to Earth with antennae that use little more power than a light-bulb.

To perform this transmission through the noisy vacuum of space, Cassini employs what are known as error-correcting codes. These contain internal tricks that allow the receiver to determine whether what has been received is accurate and, ideally, to reconstruct the correct version if it is not.

Such codes go back to 1948, the year when Claude Shannon, universally regarded as the father of coding theory, published a paper which showed the maximum theoretical rate at which information can be transmitted without error. But it is only recently that real codes have started to approach Shannon's theoretical limit. Those on Cassini, while powerful, still have some way to go, because the probe is limited to the technology available when it was built in the mid-1990s. But developments in coding theory made at the time Cassini was being assembled are now coming to fruition. As a result, as well as spacecraft, tomorrow's consumer-electronic devices, from mobile phones to high-definition televisions, will be able to receive and transmit data at something close to Shannon's limit.

Turbo coding, as the first of the new techniques to come on stream is known, was invented by Alain Glavieux and Claude Berrou, two researchers at the Ecole Nationale Supérieure des Télécommunications de Bretagne in Brest, France. It is now being deployed in third-generation (3G) mobile-telephone networks, and will allow wireless access from 3G phones to be over ten times faster than from an old-fashioned dial-up line.

Turbo-charged transmission

Turbo coding takes one of the techniques deployed on Cassini--known as convolution coding--and doubles it. Convolutional codes work by adding some of the bits (the ones and zeros of binary arithmetic) from a block of data, and transmitting that sum alongside the raw data. The decoder then works backwards, to make sure the sums add up correctly. If they do not, it knows there has been a mistake and fiddles with the appropriate bits to try to correct the errors. Unfortunately, it does not always succeed.

What Dr Glavieux and Dr Berrou showed was that combining two convolutional codes would yield a dramatic improvement in performance--one that would go almost all the way to the Shannon limit. To do this, you have to shuffle the bits in each block of data at random. Each block is then broadcast twice--once unshuffled and once shuffled. One convolutional decoder works on the unshuffled data, and the other on the shuffled data. The shuffling means that an error which affects one block will not affect the other at the same place in the sequence.

If the two decoders disagree about a particular bit in the message because transmission noise has introduced errors, they consult one another by feeding their "opinions" about the error to each other, along with a measure of how confident each is about its opinion. Each decoder then uses the other's input to make a decision, and the process is repeated until they agree with each other.

This feedback loop has proved to be

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Coding theory

Not the usual channels

Jul 1st 2004
From The Economist print edition

[Image]

How to transmit information reliably

ON JULY 1st, a spacecraft called Cassini went into orbit around Saturn--the first probe to visit the planet since 1981. While the rockets that got it there are surely impressive, just as impressive, and much neglected, is the communications technology that will allow it to transmit its pictures millions of kilometres back to Earth with antennae that use little more power than a light-bulb.

To perform this transmission through the noisy vacuum of space, Cassini employs what are known as error-correcting codes. These contain internal tricks that allow the receiver to determine whether what has been received is accurate and, ideally, to reconstruct the correct version if it is not.

Such codes go back to 1948, the year when Claude Shannon, universally regarded as the father of coding theory, published a paper which showed the maximum theoretical rate at which information can be transmitted without error. But it is only recently that real codes have started to approach Shannon's theoretical limit. Those on Cassini, while powerful, still have some way to go, because the probe is limited to the technology available when it was built in the mid-1990s. But developments in coding theory made at the time Cassini was being assembled are now coming to fruition. As a result, as well as spacecraft, tomorrow's consumer-electronic devices, from mobile phones to high-definition televisions, will be able to receive and transmit data at something close to Shannon's limit.

Turbo coding, as the first of the new techniques to come on stream is known, was invented by Alain Glavieux and Claude Berrou, two researchers at the Ecole Nationale Supérieure des Télécommunications de Bretagne in Brest, France. It is now being deployed in third-generation (3G) mobile-telephone networks, and will allow wireless access from 3G phones to be over ten times faster than from an old-fashioned dial-up line.

Turbo-charged transmission

Turbo coding takes one of the techniques deployed on Cassini--known as convolution coding--and doubles it. Convolutional codes work by adding some of the bits (the ones and zeros of binary arithmetic) from a block of data, and transmitting that sum alongside the raw data. The decoder then works backwards, to make sure the sums add up correctly. If they do not, it knows there has been a mistake and fiddles with the appropriate bits to try to correct the errors. Unfortunately, it does not always succeed.

What Dr Glavieux and Dr Berrou showed was that combining two convolutional codes would yield a dramatic improvement in performance--one that would go almost all the way to the Shannon limit. To do this, you have to shuffle the bits in each block of data at random. Each block is then broadcast twice--once unshuffled and once shuffled. One convolutional decoder works on the unshuffled data, and the other on the shuffled data. The shuffling means that an error which affects one block will not affect the other at the same place in the sequence.

If the two decoders disagree about a particular bit in the message because transmission noise has introduced errors, they consult one another by feeding their "opinions" about the error to each other, along with a measure of how confident each is about its opinion. Each decoder then uses the other's input to make a decision, and the process is repeated until they agree with each other.

This feedback loop has proved to be

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Non-governmental organisations and business

Living with the enemy

Aug 7th 2003
From The Economist print edition

[Image]

Companies are increasingly under attack from NGOs. Should they co-operate?

BEING the boss of a big company besieged by indignant activists is not much fun--though it is increasingly a fact of life. Mention, say, Greenpeace, to a typical boss and he will often turn apoplectic. Still, a growing number of executives are concluding that it is better to get along with the lobbyists than to attack them. Just look at the rapid spread of activist-friendly corporate social responsibility policies or listen to Lord (John) Browne describe how green nowadays is his firm, BP--even if it still makes its money selling oil.

Consider, too, the lengthening lists on the "Victories" pages of the websites of campaigning groups such as the Rainforest Action Network. Among its trophies is Citigroup. RAN campaigned to get the financial giant to adopt policies to reduce habitat loss and climate change, urging customers to cut up their Citicards and plastering the internet with nasty jibes against named executives. In April, RAN announced a truce, claiming that Citi had agreed to what it wanted. Not bad for a group with a dozen staff and a $2m budget.

In the contest between NGOs and companies, size is no advantage. Nor is being in the right. NGOs are increasingly pursuing their campaigns within America's notoriously plaintiff-friendly legal system, with its potential for huge payouts. (Worse, a case involving Nike now before the Supreme Court might discourage firms from entering into public debate with activists, by classifying their comments as "commercial speech", which lacks America's usual protection for free speech.)

So what is the best policy for a firm attacked by such NGOs (non-governmental organisations)--which, in contrast to the many NGOs that simply get on with doing good works, aim to force firms to change by deluging them with bad publicity? Should the NGO be attacked, ignored or befriended? The answer may vary, depending on the kind of business a firm is in--and the nature of the NGO.

Many bosses face growing pressure to talk with their NGO critics--even if this leads to little more than cosmetic action. Many folk assume that firms such as Nike, Nestlé and Shell have paid heftily for being targeted by a high-profile campaign.

Barking not biting

The memory of a campaign may linger, but evidence of damage is scarce. Few customers of Citigroup seem to have cut up their cards. Craig Smith of London Business School studied the impact of an NGO campaign against a big European food firm and found that sales initially dropped but recovered within a few months.

As for the share price, even in the case of companies pilloried for investing in South Africa during the era of apartheid, two somewhat incompatible studies found little reason to respond to the activists. One found that pressure had no discernible impact on the share price; the other, that announcing withdrawal from South Africa actually cut the share price.

This lack of impact may not be entirely surprising. Although the utterances of NGOs are often reported in the media as if they were Holy Writ, as they have become more sophisticated--even business-like--some NGOs have selected their campaigns less for the significance of the cause than for their ability to attract publicity and to raise donations from consumers in the market for things to feel angry about.

Still, it can sometimes make sense to co-operate with NGOs. Some firms will incur lower costs

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Non-governmental organisations and business

Living with the enemy

Aug 7th 2003
From The Economist print edition

[Image]

Companies are increasingly under attack from NGOs. Should they co-operate?

BEING the boss of a big company besieged by indignant activists is not much fun--though it is increasingly a fact of life. Mention, say, Greenpeace, to a typical boss and he will often turn apoplectic. Still, a growing number of executives are concluding that it is better to get along with the lobbyists than to attack them. Just look at the rapid spread of activist-friendly corporate social responsibility policies or listen to Lord (John) Browne describe how green nowadays is his firm, BP--even if it still makes its money selling oil.

Consider, too, the lengthening lists on the "Victories" pages of the websites of campaigning groups such as the Rainforest Action Network. Among its trophies is Citigroup. RAN campaigned to get the financial giant to adopt policies to reduce habitat loss and climate change, urging customers to cut up their Citicards and plastering the internet with nasty jibes against named executives. In April, RAN announced a truce, claiming that Citi had agreed to what it wanted. Not bad for a group with a dozen staff and a $2m budget.

In the contest between NGOs and companies, size is no advantage. Nor is being in the right. NGOs are increasingly pursuing their campaigns within America's notoriously plaintiff-friendly legal system, with its potential for huge payouts. (Worse, a case involving Nike now before the Supreme Court might discourage firms from entering into public debate with activists, by classifying their comments as "commercial speech", which lacks America's usual protection for free speech.)

So what is the best policy for a firm attacked by such NGOs (non-governmental organisations)--which, in contrast to the many NGOs that simply get on with doing good works, aim to force firms to change by deluging them with bad publicity? Should the NGO be attacked, ignored or befriended? The answer may vary, depending on the kind of business a firm is in--and the nature of the NGO.

Many bosses face growing pressure to talk with their NGO critics--even if this leads to little more than cosmetic action. Many folk assume that firms such as Nike, Nestlé and Shell have paid heftily for being targeted by a high-profile campaign.

Barking not biting

The memory of a campaign may linger, but evidence of damage is scarce. Few customers of Citigroup seem to have cut up their cards. Craig Smith of London Business School studied the impact of an NGO campaign against a big European food firm and found that sales initially dropped but recovered within a few months.

As for the share price, even in the case of companies pilloried for investing in South Africa during the era of apartheid, two somewhat incompatible studies found little reason to respond to the activists. One found that pressure had no discernible impact on the share price; the other, that announcing withdrawal from South Africa actually cut the share price.

This lack of impact may not be entirely surprising. Although the utterances of NGOs are often reported in the media as if they were Holy Writ, as they have become more sophisticated--even business-like--some NGOs have selected their campaigns less for the significance of the cause than for their ability to attract publicity and to raise donations from consumers in the market for things to feel angry about.

Still, it can sometimes make sense to co-operate with NGOs. Some firms will incur lower costs

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Lexington

Moore's law

Jul 1st 2004
From The Economist print edition

The success of his new film is bad news for George Bush. But is it good news for the Democrats?

[Image]

DURING the first three years of the Bush administration the White House rolled over liberal America relentlessly. George Bush began with surprise on his side: the Democratic Party never expected a "compassionate conservative" with a doubtful mandate to morph into a fiery apostle of tax cuts. After September 11th, he benefited from the instinct to rally round the flag. And then he had the Democrats' fear of being seen as wimps when it came to dealing with Saddam Hussein.

But liberal America is no longer willing to be rolled over. Bookshops are piled high with Bush-bashing tomes. Democrats in Congress have more fire in their bellies than they have had in years. John Kerry has already raised more money than any presidential challenger. George Soros is pouring millions into Democratic think-tanks and pressure-groups.

This liberal counter-insurgency has its own pudgy Che Guevara. From the moment Mr Bush "stole" the election from Al Gore, Michael Moore launched fusillades against "the thief in chief". "Stupid White Men", whose publication was delayed by September 11th, went on to sell around 4m copies worldwide. Mr Moore is the perfect antidote to dreary diatribes in the Nation, a man who believes there is no contradiction between left-wing politics and popular entertainment.

"Fahrenheit 9/11" is Mr Moore's harshest blast against Mr Bush yet. The film has already garnered the Palme d'Or at the Cannes film festival (along with a 20-minute standing ovation). It made $24m on its opening weekend in America.

It must be said that, as cinema, the film is not up to the standards of "Roger and Me", Mr Moore's anti-capitalist documentary of 1989, in which he stalks Roger Smith, the General Motors suit who had closed a plant in Mr Moore's hometown of Flint, Michigan. Nonetheless, it gathers some fascinating footage. Mr Moore's vicious wit scores points, as in the scenes of Paul Wolfowitz slobbering saliva over his comb and John Ashcroft warbling a patriotic ditty. His portrayal of the attack on the World Trade Centre--sound only against a blank screen as the planes hit the towers--is a stroke of genius. And Mr Moore can spark genuine outrage even amongst Republicans: what on earth was the White House doing shuttling the bin Laden family out of America straight after the terrorist attacks?

Yet "Fahrenheit 9/11" is unlikely to change anybody's mind. Mr Moore takes too many cheap shots. Wanting to accuse the president of stupidity and idleness, but also of shrewd and unceasing efforts in the cause of evil, he keeps contradicting himself. He lashes Mr Bush for spending too much time on holiday, and then shows him hobnobbing with Tony Blair at Camp David. (Maybe, just maybe, they were discussing affairs of state.) He presents Saddamite Iraq as a land of jolly weddings and kite-flying children. He flirts--or appears to flirt (his method is to insinuate not assert)--with deranged conspiracy theories. Can he really be implying that the White House, and the sinister forces it strives to serve, were glad that September 11th happened?

In so far as the film has a central argument, it is that the war on terror is a confidence trick. Mr Bush is not serious about homeland security, let alone about tackling bin Laden and his Saudi friends. He is simply using terrorism as an excuse for keeping the population in a state of panic while launching a grab for Iraqi oil. Mr Moore ends the film reading a pas

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Lexington

Moore's law

Jul 1st 2004
From The Economist print edition

The success of his new film is bad news for George Bush. But is it good news for the Democrats?

[Image]

DURING the first three years of the Bush administration the White House rolled over liberal America relentlessly. George Bush began with surprise on his side: the Democratic Party never expected a "compassionate conservative" with a doubtful mandate to morph into a fiery apostle of tax cuts. After September 11th, he benefited from the instinct to rally round the flag. And then he had the Democrats' fear of being seen as wimps when it came to dealing with Saddam Hussein.

But liberal America is no longer willing to be rolled over. Bookshops are piled high with Bush-bashing tomes. Democrats in Congress have more fire in their bellies than they have had in years. John Kerry has already raised more money than any presidential challenger. George Soros is pouring millions into Democratic think-tanks and pressure-groups.

This liberal counter-insurgency has its own pudgy Che Guevara. From the moment Mr Bush "stole" the election from Al Gore, Michael Moore launched fusillades against "the thief in chief". "Stupid White Men", whose publication was delayed by September 11th, went on to sell around 4m copies worldwide. Mr Moore is the perfect antidote to dreary diatribes in the Nation, a man who believes there is no contradiction between left-wing politics and popular entertainment.

"Fahrenheit 9/11" is Mr Moore's harshest blast against Mr Bush yet. The film has already garnered the Palme d'Or at the Cannes film festival (along with a 20-minute standing ovation). It made $24m on its opening weekend in America.

It must be said that, as cinema, the film is not up to the standards of "Roger and Me", Mr Moore's anti-capitalist documentary of 1989, in which he stalks Roger Smith, the General Motors suit who had closed a plant in Mr Moore's hometown of Flint, Michigan. Nonetheless, it gathers some fascinating footage. Mr Moore's vicious wit scores points, as in the scenes of Paul Wolfowitz slobbering saliva over his comb and John Ashcroft warbling a patriotic ditty. His portrayal of the attack on the World Trade Centre--sound only against a blank screen as the planes hit the towers--is a stroke of genius. And Mr Moore can spark genuine outrage even amongst Republicans: what on earth was the White House doing shuttling the bin Laden family out of America straight after the terrorist attacks?

Yet "Fahrenheit 9/11" is unlikely to change anybody's mind. Mr Moore takes too many cheap shots. Wanting to accuse the president of stupidity and idleness, but also of shrewd and unceasing efforts in the cause of evil, he keeps contradicting himself. He lashes Mr Bush for spending too much time on holiday, and then shows him hobnobbing with Tony Blair at Camp David. (Maybe, just maybe, they were discussing affairs of state.) He presents Saddamite Iraq as a land of jolly weddings and kite-flying children. He flirts--or appears to flirt (his method is to insinuate not assert)--with deranged conspiracy theories. Can he really be implying that the White House, and the sinister forces it strives to serve, were glad that September 11th happened?

In so far as the film has a central argument, it is that the war on terror is a confidence trick. Mr Bush is not serious about homeland security, let alone about tackling bin Laden and his Saudi friends. He is simply using terrorism as an excuse for keeping the population in a state of panic while launching a grab for Iraqi oil. Mr Moore ends the film reading a pas

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Hollywood

Moore money

Jul 1st 2004
From The Economist print edition

Hollywood is waking up to the fact that controversial films are raking it in

[Image: Gross record breaker]

TWO hugely popular, hugely controversial movies have left Hollywood's big studios looking red-faced for passing up the chance to profit from them. "Fahrenheit 9/11", Michael Moore's flawed but entertaining George Bush-bashing "documentary" has grossed a record $24m in its opening weekend, having cost $16m (see article). Disney had controversially decided not to distribute the movie. Earlier this year, the big studios shunned "The Passion of the Christ", produced by Mel Gibson, partly because of accusations that it was anti-semitic. It went on to rake in $370m, making it the seventh-highest grossing film ever.

Disney's official justification for preventing its Miramax subsidiary from distributing "Fahrenheit 9/11" was that the half or more of America that disagreed with Mr Moore's views might avenge itself on the firm's products and services. "Eisner made the right decision to not use Disney shareholders' money to advocate a partisan political position," says Herbert Allen, president and chief executive officer of Allen & Co, an investment bank in New York.

Other media executives suspect that Disney's boss, Michael Eisner, also hoped to make life difficult for Harvey and Bob Weinstein at Miramax, with whom he has a fraught relationship. The Weinstein brothers had to buy the film themselves and use a smaller distributor, Lions Gate--something that seemed riskier at the time than it looks now.

Hollywood may be a bit braver in future. Rupert Murdoch, boss of News Corporation, recently told his number two, Peter Chernin, that he was disappointed at his decision to pass over "The Passion". Mr Murdoch liked the film--and would have liked the money too.

Politically controversial movies often benefit from lots of free publicity. They can expand the market for films, as the people who flock to them tend to avoid Hollywood's typical fare. When Mike Dunn, president of home entertainment at Twentieth Century Fox, went to see "Fahrenheit 9/11" in Woodland Hills, Los Angeles, he noticed that many in the audience had not been to a movie for ages. "They didn't even know how to buy a ticket, and bitched about the price of the Coke," he says. Almost one-third of the audience at "The Passion", he says, had not been to the movies in the past year.

Now studios are jostling to win the home-video rights for "Fahrenheit 9/11". Sony Pictures is said to be in the lead. Twentieth Century Fox's home entertainment division will release "The Passion" in August and, later, "The Hunting of the President", a documentary about an alleged right-wing conspiracy against Bill and Hillary Clinton. The surest guard against self-censorship by America's media giants, it seems, is big box office.

::: the economist troll

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Hollywood

Moore money

Jul 1st 2004
From The Economist print edition

Hollywood is waking up to the fact that controversial films are raking it in

[Image: Gross record breaker]

TWO hugely popular, hugely controversial movies have left Hollywood's big studios looking red-faced for passing up the chance to profit from them. "Fahrenheit 9/11", Michael Moore's flawed but entertaining George Bush-bashing "documentary" has grossed a record $24m in its opening weekend, having cost $16m (see article). Disney had controversially decided not to distribute the movie. Earlier this year, the big studios shunned "The Passion of the Christ", produced by Mel Gibson, partly because of accusations that it was anti-semitic. It went on to rake in $370m, making it the seventh-highest grossing film ever.

Disney's official justification for preventing its Miramax subsidiary from distributing "Fahrenheit 9/11" was that the half or more of America that disagreed with Mr Moore's views might avenge itself on the firm's products and services. "Eisner made the right decision to not use Disney shareholders' money to advocate a partisan political position," says Herbert Allen, president and chief executive officer of Allen & Co, an investment bank in New York.

Other media executives suspect that Disney's boss, Michael Eisner, also hoped to make life difficult for Harvey and Bob Weinstein at Miramax, with whom he has a fraught relationship. The Weinstein brothers had to buy the film themselves and use a smaller distributor, Lions Gate--something that seemed riskier at the time than it looks now.

Hollywood may be a bit braver in future. Rupert Murdoch, boss of News Corporation, recently told his number two, Peter Chernin, that he was disappointed at his decision to pass over "The Passion". Mr Murdoch liked the film--and would have liked the money too.

Politically controversial movies often benefit from lots of free publicity. They can expand the market for films, as the people who flock to them tend to avoid Hollywood's typical fare. When Mike Dunn, president of home entertainment at Twentieth Century Fox, went to see "Fahrenheit 9/11" in Woodland Hills, Los Angeles, he noticed that many in the audience had not been to a movie for ages. "They didn't even know how to buy a ticket, and bitched about the price of the Coke," he says. Almost one-third of the audience at "The Passion", he says, had not been to the movies in the past year.

Now studios are jostling to win the home-video rights for "Fahrenheit 9/11". Sony Pictures is said to be in the lead. Twentieth Century Fox's home entertainment division will release "The Passion" in August and, later, "The Hunting of the President", a documentary about an alleged right-wing conspiracy against Bill and Hillary Clinton. The surest guard against self-censorship by America's media giants, it seems, is big box office.

::: the economist troll

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Hollywood

Moore money

Jul 1st 2004
From The Economist print edition

Hollywood is waking up to the fact that controversial films are raking it in

[Image: Gross record breaker]

TWO hugely popular, hugely controversial movies have left Hollywood's big studios looking red-faced for passing up the chance to profit from them. "Fahrenheit 9/11", Michael Moore's flawed but entertaining George Bush-bashing "documentary" has grossed a record $24m in its opening weekend, having cost $16m (see article). Disney had controversially decided not to distribute the movie. Earlier this year, the big studios shunned "The Passion of the Christ", produced by Mel Gibson, partly because of accusations that it was anti-semitic. It went on to rake in $370m, making it the seventh-highest grossing film ever.

Disney's official justification for preventing its Miramax subsidiary from distributing "Fahrenheit 9/11" was that the half or more of America that disagreed with Mr Moore's views might avenge itself on the firm's products and services. "Eisner made the right decision to not use Disney shareholders' money to advocate a partisan political position," says Herbert Allen, president and chief executive officer of Allen & Co, an investment bank in New York.

Other media executives suspect that Disney's boss, Michael Eisner, also hoped to make life difficult for Harvey and Bob Weinstein at Miramax, with whom he has a fraught relationship. The Weinstein brothers had to buy the film themselves and use a smaller distributor, Lions Gate--something that seemed riskier at the time than it looks now.

Hollywood may be a bit braver in future. Rupert Murdoch, boss of News Corporation, recently told his number two, Peter Chernin, that he was disappointed at his decision to pass over "The Passion". Mr Murdoch liked the film--and would have liked the money too.

Politically controversial movies often benefit from lots of free publicity. They can expand the market for films, as the people who flock to them tend to avoid Hollywood's typical fare. When Mike Dunn, president of home entertainment at Twentieth Century Fox, went to see "Fahrenheit 9/11" in Woodland Hills, Los Angeles, he noticed that many in the audience had not been to a movie for ages. "They didn't even know how to buy a ticket, and bitched about the price of the Coke," he says. Almost one-third of the audience at "The Passion", he says, had not been to the movies in the past year.

Now studios are jostling to win the home-video rights for "Fahrenheit 9/11". Sony Pictures is said to be in the lead. Twentieth Century Fox's home entertainment division will release "The Passion" in August and, later, "The Hunting of the President", a documentary about an alleged right-wing conspiracy against Bill and Hillary Clinton. The surest guard against self-censorship by America's media giants, it seems, is big box office.

::: the economist troll

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

Piracy and the movie business

Tipping Hollywood the black spot

Aug 28th 2003
From The Economist print edition

[Image]

The movie business is not doing enough to ward off the threat of digital piracy

AS HOLLYWOOD bosses know all too well, digital piracy could plunder their industry. The music business, where piracy has long been active, has lost a quarter of its sales already. Watching its plight, the movie moguls say, has taught them a lesson: listen to what the customer wants and keep the business model flexible. But investors are not convinced that Hollywood's leaders are on top of the piracy threat. Like Scarlett O'Hara in "Gone with the Wind", says Gordon Crawford, an investor at Capital Research and Management in Los Angeles, many have decided to do something about it tomorrow.

It is true that movies are not yet as vulnerable as music. Hollywood starts from a better position. Its products are priced more reasonably than CDs. People want to watch all of a film, so there is no incentive to download a single track. It can take days to download a movie from the internet, unlike a song, which takes minutes.

But rampant DVD piracy may be coming soon, both in the form of traditional counterfeiting and downloading from the internet. Hard pirated copies are widespread, and will proliferate further with the spread of DVD recorders and burners. Already as many as 600,000 movie files are shared each day on peer-to-peer file-sharing networks such as Morpheus and Grokster, according to the Motion Picture Association of America (MPAA). That number is likely to soar as more households get broadband internet and compression technology cuts download time.

Movie industry bosses say that they are doing plenty to combat the threat. As well as helping local police with raids on counterfeiters, they are devising "digital rights management" (DRM) techniques, such as deleting content after the user has "consumed" it. They are also offering movies cheaply online and seeking new laws. This week they won a battle against pirates when California's Supreme Court ruled that the First Amendment right to free speech cannot be used as a defence by someone publishing trade secrets on the internet--in this case, software to break DVD copy protection.

American Pie-in-the-sky

Next will come an Orwellian project to "re-educate" the young. With Junior Achievement, a volunteer teaching organisation, the MPAA has developed a curriculum for use in 36,000 American classrooms which teaches that swapping content is wrong. Older file sharers will be hard to persuade, however, and hackers can usually get around any copy protection the industry devises. According to the Pew Internet & American Life Project, 65% of people who share music and video files online say they do not care if material is copyrighted. Last month, the MPAA tried an emotional approach, with a series of adverts in which a set painter, a stuntman, a make-up artist, a grip and an animator explain how piracy hurts them, not just the big bosses. The campaign is unlikely to have much effect, industry-watchers say, as everyone knows how many millions the latest blockbuster grossed and how much the star got.

To frighten people, the big music firms are going after individuals in court. Movie firms reckon that this will help them too, though for now they are leaning on universities to stop their students file-sharing. One studio suggests that parents could be presented with a bill for their child's downloading activities at college, and degrees could be withheld until someone pays. Universities may stand by their stu

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Piracy and the movie business

Tipping Hollywood the black spot

Aug 28th 2003
From The Economist print edition

[Image]

The movie business is not doing enough to ward off the threat of digital piracy

AS HOLLYWOOD bosses know all too well, digital piracy could plunder their industry. The music business, where piracy has long been active, has lost a quarter of its sales already. Watching its plight, the movie moguls say, has taught them a lesson: listen to what the customer wants and keep the business model flexible. But investors are not convinced that Hollywood's leaders are on top of the piracy threat. Like Scarlett O'Hara in "Gone with the Wind", says Gordon Crawford, an investor at Capital Research and Management in Los Angeles, many have decided to do something about it tomorrow.

It is true that movies are not yet as vulnerable as music. Hollywood starts from a better position. Its products are priced more reasonably than CDs. People want to watch all of a film, so there is no incentive to download a single track. It can take days to download a movie from the internet, unlike a song, which takes minutes.

But rampant DVD piracy may be coming soon, both in the form of traditional counterfeiting and downloading from the internet. Hard pirated copies are widespread, and will proliferate further with the spread of DVD recorders and burners. Already as many as 600,000 movie files are shared each day on peer-to-peer file-sharing networks such as Morpheus and Grokster, according to the Motion Picture Association of America (MPAA). That number is likely to soar as more households get broadband internet and compression technology cuts download time.

Movie industry bosses say that they are doing plenty to combat the threat. As well as helping local police with raids on counterfeiters, they are devising "digital rights management" (DRM) techniques, such as deleting content after the user has "consumed" it. They are also offering movies cheaply online and seeking new laws. This week they won a battle against pirates when California's Supreme Court ruled that the First Amendment right to free speech cannot be used as a defence by someone publishing trade secrets on the internet--in this case, software to break DVD copy protection.

American Pie-in-the-sky

Next will come an Orwellian project to "re-educate" the young. With Junior Achievement, a volunteer teaching organisation, the MPAA has developed a curriculum for use in 36,000 American classrooms which teaches that swapping content is wrong. Older file sharers will be hard to persuade, however, and hackers can usually get around any copy protection the industry devises. According to the Pew Internet & American Life Project, 65% of people who share music and video files online say they do not care if material is copyrighted. Last month, the MPAA tried an emotional approach, with a series of adverts in which a set painter, a stuntman, a make-up artist, a grip and an animator explain how piracy hurts them, not just the big bosses. The campaign is unlikely to have much effect, industry-watchers say, as everyone knows how many millions the latest blockbuster grossed and how much the star got.

To frighten people, the big music firms are going after individuals in court. Movie firms reckon that this will help them too, though for now they are leaning on universities to stop their students file-sharing. One studio suggests that parents could be presented with a bill for their child's downloading activities at college, and degrees could be withheld until someone pays. Universities may stand by their stu

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Technology in China

The allure of low technology

Dec 18th 2003 | BEIJING AND HONG KONG
From The Economist print edition

China's misguided attempts to become a high-tech economy

THE country's success in putting a man into space this October, only the third nation to do so, was more than just a boost to national pride. It signalled the Chinese government's intention to turn the world's workshop into a technological powerhouse. With an abundance of cheap engineers, growing research spending and plenty of useful foreign intellectual property on hand (and not terribly well protected), many of the necessary building blocks would appear to be in place. To the consternation of many firms in the rich world, China has already become a big exporter of electronic components, DVD players and digital cameras. Chinese manufacturers, such as Legend in personal computers and Ningbo Bird in mobile-phone handsets, have seized leading positions in China's domestic market. A few--such as TCL, a TV manufacturer; Huawei, which makes telecoms switching gear; and Haier, a white-goods group--are building a global presence.

This is threatening to inflame already raw trade relations with the rest of the world. The prime minister, Wen Jiabao, recently called on America to open its high-tech sector to China in return for trade concessions. Meanwhile, in a bald display of protectionism, foreign computer- and chip-makers have been banned (since December 1st) from selling some wireless products in China unless they incorporate Chinese encryption standards sourced from 11 named Chinese firms. If the rule is enforced, Dell, Intel, Sony and others may have to choose between sharing technology or curtailing shipments to China.

A handful

So will China become the next technology superpower? Actually, probably not--at least, not anytime soon. Its successes so far are restricted to a handful of firms, most are either protected or exceptional, rising through cracks in China's planned economy. On December 10th, at a seminar in Beijing on Chinese technology organised by China Economic Quarterly, a research publication, Ming Zeng, a professor at Insead, near Paris, and Beijing's Cheung Kong Business School (and a noted optimist on Chinese firms) admitted: "I spent five years hunting for examples of successful high-tech companies in China. After all that work, I can only find three or four."

Overall, China's technology base remains limited and the capital infrastructure needed to produce advanced, high-tech goods largely absent. And while more and more high-tech goods are made in China, almost all the value is being captured by foreign companies (see chart). Writing in the quarterly, Daniel Rosen, a visiting fellow at the Institute for International Economics in Washington, DC, argues that, on close inspection, "China's high-tech exports turn out not to be so very high-tech--nor, indeed, very Chinese."

[Image]

Of $325 billion of exports in 2002, China's Ministry of Commerce rated only 20% as genuinely high-tech. And those were mostly mature commodities, such as DVD players and laser printers. The brains of these machines, namely their semiconductor chips, were almost all imported--reflected in China's high-tech trade deficit of around $15 billion. What's more, 85% of its high-tech exports between January and August 2003 were accounted for by foreign enterprises in China.

It is the same story with semiconductors, an industry China has explicitly targeted for development. The country is a voracious consumer of chips and an increasingly important location for silicon-wafer plants,

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Technology in China

The allure of low technology

Dec 18th 2003 | BEIJING AND HONG KONG
From The Economist print edition

China's misguided attempts to become a high-tech economy

THE country's success in putting a man into space this October, only the third nation to do so, was more than just a boost to national pride. It signalled the Chinese government's intention to turn the world's workshop into a technological powerhouse. With an abundance of cheap engineers, growing research spending and plenty of useful foreign intellectual property on hand (and not terribly well protected), many of the necessary building blocks would appear to be in place. To the consternation of many firms in the rich world, China has already become a big exporter of electronic components, DVD players and digital cameras. Chinese manufacturers, such as Legend in personal computers and Ningbo Bird in mobile-phone handsets, have seized leading positions in China's domestic market. A few--such as TCL, a TV manufacturer; Huawei, which makes telecoms switching gear; and Haier, a white-goods group--are building a global presence.

This is threatening to inflame already raw trade relations with the rest of the world. The prime minister, Wen Jiabao, recently called on America to open its high-tech sector to China in return for trade concessions. Meanwhile, in a bald display of protectionism, foreign computer- and chip-makers have been banned (since December 1st) from selling some wireless products in China unless they incorporate Chinese encryption standards sourced from 11 named Chinese firms. If the rule is enforced, Dell, Intel, Sony and others may have to choose between sharing technology or curtailing shipments to China.

A handful

So will China become the next technology superpower? Actually, probably not--at least, not anytime soon. Its successes so far are restricted to a handful of firms, most are either protected or exceptional, rising through cracks in China's planned economy. On December 10th, at a seminar in Beijing on Chinese technology organised by China Economic Quarterly, a research publication, Ming Zeng, a professor at Insead, near Paris, and Beijing's Cheung Kong Business School (and a noted optimist on Chinese firms) admitted: "I spent five years hunting for examples of successful high-tech companies in China. After all that work, I can only find three or four."

Overall, China's technology base remains limited and the capital infrastructure needed to produce advanced, high-tech goods largely absent. And while more and more high-tech goods are made in China, almost all the value is being captured by foreign companies (see chart). Writing in the quarterly, Daniel Rosen, a visiting fellow at the Institute for International Economics in Washington, DC, argues that, on close inspection, "China's high-tech exports turn out not to be so very high-tech--nor, indeed, very Chinese."

[Image]

Of $325 billion of exports in 2002, China's Ministry of Commerce rated only 20% as genuinely high-tech. And those were mostly mature commodities, such as DVD players and laser printers. The brains of these machines, namely their semiconductor chips, were almost all imported--reflected in China's high-tech trade deficit of around $15 billion. What's more, 85% of its high-tech exports between January and August 2003 were accounted for by foreign enterprises in China.

It is the same story with semiconductors, an industry China has explicitly targeted for development. The country is a voracious consumer of chips and an increasingly important location for silicon-wafer plants,

> I can tell you cafe rates never approached $3.00

The prices in the article are converted at PPP (purchasing power parity) not "raw" exchange rates, so your calculation of "4 reis ~= $1.25" is bogus in this context.

BTW, the Economist has an interesting version of a PPP calculation based on big macs

We can start compiling better (and statistically, better 'weighted') indicators of PPP than the incredibly successful (but somewhat outdated) Big Mac Index.

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Technology, shopping and beyond

The future is still smart

Jun 24th 2004 | LONDON AND NEW YORK
From The Economist print edition

[Image]

Contrary to some recent reports, the roll-out of revolutionary smart-tag technology is still going to plan

SO THOROUGHLY have the lessons of the internet bubble been learned that the launch of any new technology is now invariably accompanied by much talk from industry observers about dangerous hype and inevitable disappointment. A case in point is radio frequency identification (RFID), a new, super-cheap version of which may, its backers hope, be destined to transform everything from shopping to warfare. As soon as RFID's boosters alerted the world to their innovations, reports of dire setbacks began to circulate. Yet if anything, the surprise is how well the roll-out of the new technology is meeting early expectations.

RFID systems are made up of readers and "smart tags"--tiny microchips each with an attached antenna. The tags can be stuck on everything from milk cartons to hospital patients. When prompted by a reader, the tag broadcasts the information on its chip. Unlike the traditional bar-code, which smart tags aim to replace, RFID chips give every tagged object a unique identification. (A bar-code describes only a class of objects, such as cans of Coke.) Companies hope to use RFID to track the trillions of objects that circulate the world every year in planes, lorries and ships, through ports and warehouses, on to shop shelves, through tills and into homes and offices. Accurate tracking should eventually save hundreds of billions of dollars a year as it improves distribution, reduces theft, cuts labour costs and shrinks inventory. Governments also want to use RFID to reduce drug counterfeiting and improve military logistics, among other things.

Smarter than the average bar-code

Firms have put smart tags on some goods for quite a while. But due to their cost tags have until recently mostly been stuck on expensive or oft-stolen items, such as designer clothes and compact discs.

In 2002, the Auto-ID centre, a partnership between academic researchers and business based in Cambridge, Massachusetts, came up with a standard for a new, stripped-down RFID chip that stores just 96 bits of information--enough to give every object in the world a unique number. With tag readers plugged into a computer network, this number can be used to look up detailed information about the object, such as its origin, age and expiry date. At the same time, the Auto-ID centre also challenged manufacturers to produce a five-cent tag. Several start-ups, including Alien Technology and Matrics, said they could do so. Suddenly, there was huge interest and talk of a potential mass market.

Last June, Wal-Mart, the world's biggest retailer, said it would require its 100 top suppliers to put tags on pallets and cases of products for shipment to a cluster of its supercentres in northern Texas. (Those press-ganged suppliers were later joined by 37 "volunteers".) Tesco, Britain's biggest retailer, also decided to introduce the technology. This year Metro, a German retailer, and Target and Albertsons, two other American ones, announced tag mandates for their suppliers. On June 17th, Wal-Mart said it would extend its RFID roll-out to its top 300 suppliers and to more shops.

The American government is becoming a big user of the new tags, too. Last October, the Pentagon said it would require its suppliers to put tags on cases and pallets shipped to its warehouses. It expects suppliers to have the technology working by January. The Food and Dr

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Technology, shopping and beyond

The future is still smart

Jun 24th 2004 | LONDON AND NEW YORK
From The Economist print edition

[Image]

Contrary to some recent reports, the roll-out of revolutionary smart-tag technology is still going to plan

SO THOROUGHLY have the lessons of the internet bubble been learned that the launch of any new technology is now invariably accompanied by much talk from industry observers about dangerous hype and inevitable disappointment. A case in point is radio frequency identification (RFID), a new, super-cheap version of which may, its backers hope, be destined to transform everything from shopping to warfare. As soon as RFID's boosters alerted the world to their innovations, reports of dire setbacks began to circulate. Yet if anything, the surprise is how well the roll-out of the new technology is meeting early expectations.

RFID systems are made up of readers and "smart tags"--tiny microchips each with an attached antenna. The tags can be stuck on everything from milk cartons to hospital patients. When prompted by a reader, the tag broadcasts the information on its chip. Unlike the traditional bar-code, which smart tags aim to replace, RFID chips give every tagged object a unique identification. (A bar-code describes only a class of objects, such as cans of Coke.) Companies hope to use RFID to track the trillions of objects that circulate the world every year in planes, lorries and ships, through ports and warehouses, on to shop shelves, through tills and into homes and offices. Accurate tracking should eventually save hundreds of billions of dollars a year as it improves distribution, reduces theft, cuts labour costs and shrinks inventory. Governments also want to use RFID to reduce drug counterfeiting and improve military logistics, among other things.

Smarter than the average bar-code

Firms have put smart tags on some goods for quite a while. But due to their cost tags have until recently mostly been stuck on expensive or oft-stolen items, such as designer clothes and compact discs.

In 2002, the Auto-ID centre, a partnership between academic researchers and business based in Cambridge, Massachusetts, came up with a standard for a new, stripped-down RFID chip that stores just 96 bits of information--enough to give every object in the world a unique number. With tag readers plugged into a computer network, this number can be used to look up detailed information about the object, such as its origin, age and expiry date. At the same time, the Auto-ID centre also challenged manufacturers to produce a five-cent tag. Several start-ups, including Alien Technology and Matrics, said they could do so. Suddenly, there was huge interest and talk of a potential mass market.

Last June, Wal-Mart, the world's biggest retailer, said it would require its 100 top suppliers to put tags on pallets and cases of products for shipment to a cluster of its supercentres in northern Texas. (Those press-ganged suppliers were later joined by 37 "volunteers".) Tesco, Britain's biggest retailer, also decided to introduce the technology. This year Metro, a German retailer, and Target and Albertsons, two other American ones, announced tag mandates for their suppliers. On June 17th, Wal-Mart said it would extend its RFID roll-out to its top 300 suppliers and to more shops.

The American government is becoming a big user of the new tags, too. Last October, the Pentagon said it would require its suppliers to put tags on cases and pallets shipped to its warehouses. It expects suppliers to have the technology working by January. The Food and Dr

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Video games

A serious contest

May 6th 2004
From The Economist print edition

Can Microsoft's clever strategy level the playing field with Sony?

LIKE the combatants in a beat-'em-up video game, the makers of video-games consoles do battle in orderly rounds, one of which occurs every five or six years. The current round began in 2000, when Sony launched PlayStation 2. In 2001 Nintendo, the firm that once ruled the industry, launched the GameCube, and Microsoft made its first foray into the cut-throat market with the Xbox. Four years on, Sony is the clear winner, with sales of 70m consoles, followed by Microsoft with 14m and Nintendo with 13m.

Next week, the industry's biggest trade show, E3, which takes place in Los Angeles, will provide the first glimpses of the next round. It is expected to be a brutal two-way fight. For, after a difficult start, Microsoft has now established itself as Sony's main rival, and is gaining momentum. Most important, it has won the crucial support of games publishers, says Nick Gibson of Games Investor, a consultancy. That means Microsoft will "pretty much be neck and neck with Sony" in the next round. Nintendo, by contrast, has been less successful at keeping publishers on board, and has survived thanks only to the strength of its in-house software business.

Xbox Live, Microsoft's subscription-based online-gaming service, has also been well received. It provides features, such as global player rankings, that Sony cannot match. And although online gaming is still a minority sport, it is expected to be far more significant in the next round, as broadband connections and wireless home networks become more widespread. By signing up customers for Xbox Live now, Microsoft hopes to retain their loyalty into the next round.

But perhaps cleverest of all is Microsoft's new software-development platform for games, called XNA, a set of software tools that can be used to write games for PCs, Xbox and the forthcoming Xbox 2. According to Robbie Bach, Microsoft's "chief Xbox officer", insulating programmers from the underlying complexity of the console hardware "creates huge cost efficiency and flexibility." While Microsoft will probably not unveil the Xbox 2 at E3, says P.J. McNealy, an analyst at American Technology Research, the XNA tools will enable the firm to demonstrate the kind of things that will be possible on Xbox 2 when it appears.

The contrast with Sony is striking. While Microsoft is focusing on software, Sony is emphasising hardware innovation for its PlayStation 3. Its plan, which it has yet to describe fully, is to use a new kind of chip, called Cell, as the basis for both the PlayStation 3 and its consumer-electronics devices, such as DVD players. With multiple Cell chips working in parallel, the PlayStation 3 will be a powerful machine. But its radical new architecture will require games programmers to start from scratch. In the meantime, Sony is trying to keep developers focused on the PlayStation 2.

Microsoft senses an opportunity. It is widely expected to steal a march on Sony by launching the Xbox 2 towards the end of next year, kicking off the next round before Sony is ready. "Microsoft has taken the gloves off," says Mr McNealy. The PlayStation 3 is not expected until early 2006, and even then only in Japan; analysts do not expect the worldwide launch until late 2006. (Nintendo's successor to the GameCube is also expected in 2006.) Last time around, Sony's 18-month head start and Microsoft's status as the industry's newcomer meant that the Xbox never had a chance of catching up with PlayStation 2; it was always going to be just a trial run for Microsoft. But now Sony and Microsoft look evenly matched--and the battle can begin in earnest.

::: the economist troll

Interestingly, although the copied article text is accurately reproduced according to Araxis Merge, and well-typeset, the original article doesn't actually appear to be "subscriber-only." I have no problems accessing it, and I surely don't have a subscription. A bizarre post, this parent.

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MONITOR

Beyond the digital divide

Mar 11th 2004
From The Economist print edition

Development: Amid much worthy talk of "bridging the digital divide", technology firms have realised that fostering the adoption of information technology in the developing world would not just benefit locals, but is in vendors' best interests as well

[Image: Aggregated buying power in action]

THE gleaming Indian headquarters of Hewlett-Packard, an American computing giant, are testament to India's technology-led boom. The glass-panelled tower, located on a busy Bangalore thoroughfare, swarms with a new breed of well-heeled urban professionals. But inside the building, in a warren of cubicles on the second floor, a rather different customer is being targeted. Engineers and programmers at HP Labs, the company's research arm, are working on low-cost devices for the three-quarters of Indians who still live in the countryside. In one room, a cheap e-mail device that allows messages to be sent in local languages is on display; in another sits a tablet-shaped PC that lets users fill out government forms in Indian scripts.

These technologies are part of HP's ambitious plans to sell to the 4 billion poorest people at the bottom of the global economic pyramid. In addition to work being done at the HP Labs, the company has also invested resources in its "e-inclusion" initiative, a project designed to set up "Digital Villages" and "i-communities" around the world--the former are philanthropic projects, the latter strategic market investments. Several centres--in India, South Africa, Ghana and Brazil--have already been established.

All of this activity could easily be mistaken for yet another philanthropic effort to bridge the "digital divide" between rich and poor. But that is only part of the story. Anand Tawker, the head of HP's e-inclusion efforts in Asia, speaks of a "blended strategy" that creates social benefits at the same time as boosting HP's brand and sales. "In the process of creating social value, there is also a profitable return to HP," he says. "Doing good and doing well are not mutually exclusive."

HP is somewhat ahead of the curve, but it is not alone. Companies around the world are now busy developing low-cost devices and innovative business models to reach the world's poor. Intel, the world's largest chipmaker, is pushing cheap wireless-data systems as the best way to extend connectivity to rural areas. Vodacom, South Africa's largest mobile operator, has set up "phone shops" where rural entrepreneurs can buy and resell airtime. And the Indian Institute of Technology (IIT) in Chennai recently unveiled a stripped-down cash-dispenser that it plans to take to the masses in partnership with private-sector banks.

Of course, the idea that the poor constitute an untapped market is hardly new. Hindustan Lever, a subsidiary of Unilever, pioneered the idea years ago, marketing its shampoos and detergents in single-use sachets rather than larger (and more expensive) bottles. But the increasing ubiquity--and falling cost--of digital networks has heightened interest in these markets for at least two reasons. First, such networks increase information transparency, allowing, for instance, farmers or fishermen to sell their produce to the highest bidder, rather than just to the nearest market. This in turn creates new markets and expands existing ones. Second, dispersed electronic databases can aggregate demand, opening up low-margin markets that depend on high volumes for their viability.

In a celebrated article published in the Harvard Business Review in 2002, C. K. Prahalad of th

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----

MONITOR

Beyond the digital divide

Mar 11th 2004
From The Economist print edition

Development: Amid much worthy talk of "bridging the digital divide", technology firms have realised that fostering the adoption of information technology in the developing world would not just benefit locals, but is in vendors' best interests as well

[Image: Aggregated buying power in action]

THE gleaming Indian headquarters of Hewlett-Packard, an American computing giant, are testament to India's technology-led boom. The glass-panelled tower, located on a busy Bangalore thoroughfare, swarms with a new breed of well-heeled urban professionals. But inside the building, in a warren of cubicles on the second floor, a rather different customer is being targeted. Engineers and programmers at HP Labs, the company's research arm, are working on low-cost devices for the three-quarters of Indians who still live in the countryside. In one room, a cheap e-mail device that allows messages to be sent in local languages is on display; in another sits a tablet-shaped PC that lets users fill out government forms in Indian scripts.

These technologies are part of HP's ambitious plans to sell to the 4 billion poorest people at the bottom of the global economic pyramid. In addition to work being done at the HP Labs, the company has also invested resources in its "e-inclusion" initiative, a project designed to set up "Digital Villages" and "i-communities" around the world--the former are philanthropic projects, the latter strategic market investments. Several centres--in India, South Africa, Ghana and Brazil--have already been established.

All of this activity could easily be mistaken for yet another philanthropic effort to bridge the "digital divide" between rich and poor. But that is only part of the story. Anand Tawker, the head of HP's e-inclusion efforts in Asia, speaks of a "blended strategy" that creates social benefits at the same time as boosting HP's brand and sales. "In the process of creating social value, there is also a profitable return to HP," he says. "Doing good and doing well are not mutually exclusive."

HP is somewhat ahead of the curve, but it is not alone. Companies around the world are now busy developing low-cost devices and innovative business models to reach the world's poor. Intel, the world's largest chipmaker, is pushing cheap wireless-data systems as the best way to extend connectivity to rural areas. Vodacom, South Africa's largest mobile operator, has set up "phone shops" where rural entrepreneurs can buy and resell airtime. And the Indian Institute of Technology (IIT) in Chennai recently unveiled a stripped-down cash-dispenser that it plans to take to the masses in partnership with private-sector banks.

Of course, the idea that the poor constitute an untapped market is hardly new. Hindustan Lever, a subsidiary of Unilever, pioneered the idea years ago, marketing its shampoos and detergents in single-use sachets rather than larger (and more expensive) bottles. But the increasing ubiquity--and falling cost--of digital networks has heightened interest in these markets for at least two reasons. First, such networks increase information transparency, allowing, for instance, farmers or fishermen to sell their produce to the highest bidder, rather than just to the nearest market. This in turn creates new markets and expands existing ones. Second, dispersed electronic databases can aggregate demand, opening up low-margin markets that depend on high volumes for their viability.

In a celebrated article published in the Harvard Business Review in 2002, C. K. Prahalad of th

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

This is the second of two relevant articles in this issue.

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Microsoft

Windows à la carte

Mar 25th 2004
From The Economist print edition

[Image]

Might the European Commission's controversial new antidote to Microsoft's monopoly actually work?

HALF a billion euro? Forget about it. The headline-grabbing EUR497m ($612m) fine imposed by the European Commission on Microsoft this week is the least of the software giant's worries, for it makes that much profit every two weeks and is sitting on a cash pile nearly 100 times bigger. Far more worrying for Microsoft is the commission's demand that it produce, within 90 days, a version of its Windows operating system stripped of its media-playback capabilities. That sounds trivial, but it would set an important precedent that could be used to make Microsoft remove other bits from Windows in future. Hence Microsoft's recent strenuous efforts to negotiate a settlement to avoid this week's ruling, and its determination to have the ruling overturned on appeal. Allowing PC-makers to pick and choose which bits of Windows they want from an "à la carte" list of features is something Microsoft wants to avoid at all costs.

That is because Microsoft relies on the "bundling" of new features into Windows to protect its existing monopoly and to extend it into new areas. Windows is installed on over 90% of new PCs. So any feature Microsoft adds--a web browser, say, or a media player--quickly becomes ubiquitous. Rival products, such as Netscape's web browser or the RealNetworks media player, which must be installed separately, lose out. Microsoft crushed Netscape this way, and now the commission has ruled that Microsoft's "bundling" of its media player into Windows "is an example of a more general business model which deters innovation and reduces consumer choice in any technologies which Microsoft could conceivably take interest in and tie with Windows in the future."

The next version of Windows, codenamed Longhorn, due in 2006, will include search, database and security add-ons, and will no doubt inspire new legal challenges. By making Microsoft "unbundle" its media player when asked to do so by PC-makers, who can then substitute an alternative, the commission's aim is both to level the playing field today and pave the way for further unbundlings in future.

So great is Microsoft's desire to preserve its ability to bundle that, during settlement talks with the commission, it even offered to include rival media players in Windows, rather than remove its own. But Mario Monti, Europe's competition commissioner, was less interested in winning yesterday's battles than in preventing tomorrow's misdeeds. Attempts to devise a voluntary set of rules to govern future unbundling failed, so Microsoft will now be legally compelled--subject to appeals--to unbundle its media player. This would constitute a big step towards an "à la carte" Windows. But would that actually work?

It might. If Microsoft's various add-ons were optional rather than compulsory parts of Windows, each one would have to compete on merit with rival alternatives. PC-makers could then differentiate themselves from each other by assembling different software bundles for specific markets. Indeed, to some extent, though it would never admit it, Microsoft has started down this path already: it sells several versions of Windows, including a basic version for home users, a more advanced "pro" version for business users, and specially modified versions for tablet computers, media centres and its Xbox games console. It also offers cut-down versions of Windows in some Asian

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This is the second of two relevant articles in this issue.

----

Microsoft

Windows à la carte

Mar 25th 2004
From The Economist print edition

[Image]

Might the European Commission's controversial new antidote to Microsoft's monopoly actually work?

HALF a billion euro? Forget about it. The headline-grabbing EUR497m ($612m) fine imposed by the European Commission on Microsoft this week is the least of the software giant's worries, for it makes that much profit every two weeks and is sitting on a cash pile nearly 100 times bigger. Far more worrying for Microsoft is the commission's demand that it produce, within 90 days, a version of its Windows operating system stripped of its media-playback capabilities. That sounds trivial, but it would set an important precedent that could be used to make Microsoft remove other bits from Windows in future. Hence Microsoft's recent strenuous efforts to negotiate a settlement to avoid this week's ruling, and its determination to have the ruling overturned on appeal. Allowing PC-makers to pick and choose which bits of Windows they want from an "à la carte" list of features is something Microsoft wants to avoid at all costs.

That is because Microsoft relies on the "bundling" of new features into Windows to protect its existing monopoly and to extend it into new areas. Windows is installed on over 90% of new PCs. So any feature Microsoft adds--a web browser, say, or a media player--quickly becomes ubiquitous. Rival products, such as Netscape's web browser or the RealNetworks media player, which must be installed separately, lose out. Microsoft crushed Netscape this way, and now the commission has ruled that Microsoft's "bundling" of its media player into Windows "is an example of a more general business model which deters innovation and reduces consumer choice in any technologies which Microsoft could conceivably take interest in and tie with Windows in the future."

The next version of Windows, codenamed Longhorn, due in 2006, will include search, database and security add-ons, and will no doubt inspire new legal challenges. By making Microsoft "unbundle" its media player when asked to do so by PC-makers, who can then substitute an alternative, the commission's aim is both to level the playing field today and pave the way for further unbundlings in future.

So great is Microsoft's desire to preserve its ability to bundle that, during settlement talks with the commission, it even offered to include rival media players in Windows, rather than remove its own. But Mario Monti, Europe's competition commissioner, was less interested in winning yesterday's battles than in preventing tomorrow's misdeeds. Attempts to devise a voluntary set of rules to govern future unbundling failed, so Microsoft will now be legally compelled--subject to appeals--to unbundle its media player. This would constitute a big step towards an "à la carte" Windows. But would that actually work?

It might. If Microsoft's various add-ons were optional rather than compulsory parts of Windows, each one would have to compete on merit with rival alternatives. PC-makers could then differentiate themselves from each other by assembling different software bundles for specific markets. Indeed, to some extent, though it would never admit it, Microsoft has started down this path already: it sells several versions of Windows, including a basic version for home users, a more advanced "pro" version for business users, and specially modified versions for tablet computers, media centres and its Xbox games console. It also offers cut-down versions of Windows in some Asian

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

This is the first of two relevant articles in this issue.

----

Can Microsoft be tamed?

Mar 25th 2004
From The Economist Global Agenda

After more than five years of investigation, the European Commission has fined Microsoft almost EUR500m for monopolistic abuses and given it four months to make life easier for competitors in the server and media-player markets. But with a long-winded appeal inevitable, the punishment may prove ineffectual

[Image]

IT IS headline-grabbing stuff: a fine of EUR497m ($612m)--the European Union's biggest ever for an antitrust violation. As importantly, the EU has required that Microsoft make far-reaching changes in its behaviour. But many worry that the punishments handed down by the European Commission, the EU's executive arm, on Wednesday March 24th will have little effect. Microsoft will apply for an immediate injunction against the commission's decision and will appeal. This process could take five years, a lifetime in the fast-moving world of computer software. And, in the meantime, Microsoft has its sights set on the Google search engine, just as in the past it has targeted Lotus's spreadsheet, Netscape's browser, Sun Microsystems' servers and RealNetworks' media player.

In addition to the record fine, the Commission has demanded that Microsoft do two things to make life easier for its rivals: it must produce a Windows package that excludes Windows Media Player within 90 days; and, within 120 days, it must make available a chunk of code for Windows, so that rival server manufacturers can design network computers that will work smoothly with the 90%-plus of PCs that run on Windows operating software. In essence, the Commission is attempting something genuinely new: a break-up, not of Microsoft itself, but of Windows. The logical conclusion of this is a new kind of Windows, in which PC-makers and their users are free to choose which bits of it they want to buy, and which they don't.

Microsoft has protested against the fine and these demands, saying that a settlement rejected by the EU's competition commissioner, Mario Monti, would have been better for consumers. (Many expect Microsoft to continue to push for a settlement, despite the ruling, perhaps once the appeal is under way.) Anticipating the fine, Patty Murray, a senator from Microsoft's home state of Washington, described the EU's sanctions as "a hostile act with severe consequences for the global economy". After Mr Monti's ruling, Bill Frist, the Republican leader in the Senate, described it as a "preposterous demand". It is not the first time that Mr Monti has irked Americans. There was an outcry three years ago when he blocked the merger of General Electric and Honeywell after American regulators had given it the go-ahead.

Microsoft's forays into a succession of new markets have landed it on the wrong side of antitrust authorities on both sides of the Atlantic many times before. During the late 1990s, the company fought an aggressive antitrust suit from America's Department of Justice (see timeline, above). The department argued, as European competition regulators are now doing, that Microsoft was abusing its dominance in the PC operating-software market in order to expand into other markets. The other market in that case was the one for internet browsers, then dominated by Netscape. The case led to a groundbreaking judgment, in 2000, that the only solution was a break-up of Microsoft into two companies: one making the Windows operating software, and one making the applications that run on it. That way, there would be no reason for the maker of Windows to favour products like Microsoft Office or the f

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

This is the first of two relevant articles in this issue.

----

Can Microsoft be tamed?

Mar 25th 2004
From The Economist Global Agenda

After more than five years of investigation, the European Commission has fined Microsoft almost EUR500m for monopolistic abuses and given it four months to make life easier for competitors in the server and media-player markets. But with a long-winded appeal inevitable, the punishment may prove ineffectual

[Image]

IT IS headline-grabbing stuff: a fine of EUR497m ($612m)--the European Union's biggest ever for an antitrust violation. As importantly, the EU has required that Microsoft make far-reaching changes in its behaviour. But many worry that the punishments handed down by the European Commission, the EU's executive arm, on Wednesday March 24th will have little effect. Microsoft will apply for an immediate injunction against the commission's decision and will appeal. This process could take five years, a lifetime in the fast-moving world of computer software. And, in the meantime, Microsoft has its sights set on the Google search engine, just as in the past it has targeted Lotus's spreadsheet, Netscape's browser, Sun Microsystems' servers and RealNetworks' media player.

In addition to the record fine, the Commission has demanded that Microsoft do two things to make life easier for its rivals: it must produce a Windows package that excludes Windows Media Player within 90 days; and, within 120 days, it must make available a chunk of code for Windows, so that rival server manufacturers can design network computers that will work smoothly with the 90%-plus of PCs that run on Windows operating software. In essence, the Commission is attempting something genuinely new: a break-up, not of Microsoft itself, but of Windows. The logical conclusion of this is a new kind of Windows, in which PC-makers and their users are free to choose which bits of it they want to buy, and which they don't.

Microsoft has protested against the fine and these demands, saying that a settlement rejected by the EU's competition commissioner, Mario Monti, would have been better for consumers. (Many expect Microsoft to continue to push for a settlement, despite the ruling, perhaps once the appeal is under way.) Anticipating the fine, Patty Murray, a senator from Microsoft's home state of Washington, described the EU's sanctions as "a hostile act with severe consequences for the global economy". After Mr Monti's ruling, Bill Frist, the Republican leader in the Senate, described it as a "preposterous demand". It is not the first time that Mr Monti has irked Americans. There was an outcry three years ago when he blocked the merger of General Electric and Honeywell after American regulators had given it the go-ahead.

Microsoft's forays into a succession of new markets have landed it on the wrong side of antitrust authorities on both sides of the Atlantic many times before. During the late 1990s, the company fought an aggressive antitrust suit from America's Department of Justice (see timeline, above). The department argued, as European competition regulators are now doing, that Microsoft was abusing its dominance in the PC operating-software market in order to expand into other markets. The other market in that case was the one for internet browsers, then dominated by Netscape. The case led to a groundbreaking judgment, in 2000, that the only solution was a break-up of Microsoft into two companies: one making the Windows operating software, and one making the applications that run on it. That way, there would be no reason for the maker of Windows to favour products like Microsoft Office or the f

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

RATIONAL CONSUMER

The meaning of iPod

Jun 10th 2004
From The Economist print edition

Consumer electronics: How Apple's iPod music-player and its imitators are changing the way music is consumed

WHAT is the meaning of iPod? When Apple, a computer-maker, launched its pocket-sized music-player in October 2001, there was no shortage of sceptical answers. Critics pointed to its high price--at $399, the iPod cost far more than rival music players--and to the difficulty Apple would have competing in the cut-throat consumer-electronics market. Worse, Apple launched the iPod in the depths of a technology slump. Internet discussion boards buzzed with jokes that its name stood for "idiots price our devices" or "I prefer old-fashioned discs."

Such criticisms were quickly proven wrong. The iPod is now the most popular and fashionable digital music-player on the market, which Apple leads (see chart). Apple has been unable to meet demand for the latest model, the iPod mini. On the streets and underground trains of New York, San Francisco and London, iPod users (identifiable by the device's characteristic white headphone leads) are ubiquitous. Fashion houses make iPod cases; pop stars wear iPods in their videos. The iPod is a hit.

Its success depends on many factors, but the most important is its vast storage capacity. The first model contained a five gigabyte hard disk, capable of holding over 1,000 songs. The latest models, with 40 gigabyte drives, can hold 10,000. Before the iPod, most digital music players used flash-memory chips to store music, which limited their capacity to a few dozen songs at best. Apple correctly bet that many people would pay more for the far larger capacity of a hard disk. Apple's nifty iTunes software, and the launch of the iTunes Music Store, from which music can be downloaded for $0.99 per track, also boosted the iPod's fortunes.

[Image]

It is easy to dismiss the iPod as a fad and its fanatical users as members of a gadget-obsessed cult. But the 3m or so iPod users worldwide are an informative minority, because hard-disk-based, iPod-like devices are the future of portable music. According to In-Stat/MDR, a market-research firm, iPods account for 22% of digital music-players overall, but 71% of hard-disk-based players (see chart), the fastest-growing segment: over the next five years their sales will grow by 45% a year, overtaking flash-based players during 2005. So what iPod users do today, the rest of us will do tomorrow. Their experience shows how digital music-players will transform the consumption of music.

Professor iPod speaks

Few people know more about the behaviour of iPod users than Michael Bull, a specialist in the cultural impact of technology at the University of Sussex in England. Having previously studied the impact of the cassette-based Sony Walkman, he is now surveying hundreds of iPod users. Their consumption of music, he says, changes in three main ways.

The first and most important is that the iPod grants them far more control over how and where they listen to their music. Surely, you might ask, an iPod is no different from a cassette or CD-based player, since you can always carry a few tapes or discs with you? But most people, says Dr Bull, find that if none of the music they are carrying with them fits their mood, they prefer not to listen to music at all. The large capacity of a hard-disk-based player does away with this problem. The right music can always be summoned up depending on your mood, the time of day, and your activity, says Dr Bull. As a result, iPod users tend to listen to particular music duri

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

RATIONAL CONSUMER

The meaning of iPod

Jun 10th 2004
From The Economist print edition

Consumer electronics: How Apple's iPod music-player and its imitators are changing the way music is consumed

WHAT is the meaning of iPod? When Apple, a computer-maker, launched its pocket-sized music-player in October 2001, there was no shortage of sceptical answers. Critics pointed to its high price--at $399, the iPod cost far more than rival music players--and to the difficulty Apple would have competing in the cut-throat consumer-electronics market. Worse, Apple launched the iPod in the depths of a technology slump. Internet discussion boards buzzed with jokes that its name stood for "idiots price our devices" or "I prefer old-fashioned discs."

Such criticisms were quickly proven wrong. The iPod is now the most popular and fashionable digital music-player on the market, which Apple leads (see chart). Apple has been unable to meet demand for the latest model, the iPod mini. On the streets and underground trains of New York, San Francisco and London, iPod users (identifiable by the device's characteristic white headphone leads) are ubiquitous. Fashion houses make iPod cases; pop stars wear iPods in their videos. The iPod is a hit.

Its success depends on many factors, but the most important is its vast storage capacity. The first model contained a five gigabyte hard disk, capable of holding over 1,000 songs. The latest models, with 40 gigabyte drives, can hold 10,000. Before the iPod, most digital music players used flash-memory chips to store music, which limited their capacity to a few dozen songs at best. Apple correctly bet that many people would pay more for the far larger capacity of a hard disk. Apple's nifty iTunes software, and the launch of the iTunes Music Store, from which music can be downloaded for $0.99 per track, also boosted the iPod's fortunes.

[Image]

It is easy to dismiss the iPod as a fad and its fanatical users as members of a gadget-obsessed cult. But the 3m or so iPod users worldwide are an informative minority, because hard-disk-based, iPod-like devices are the future of portable music. According to In-Stat/MDR, a market-research firm, iPods account for 22% of digital music-players overall, but 71% of hard-disk-based players (see chart), the fastest-growing segment: over the next five years their sales will grow by 45% a year, overtaking flash-based players during 2005. So what iPod users do today, the rest of us will do tomorrow. Their experience shows how digital music-players will transform the consumption of music.

Professor iPod speaks

Few people know more about the behaviour of iPod users than Michael Bull, a specialist in the cultural impact of technology at the University of Sussex in England. Having previously studied the impact of the cassette-based Sony Walkman, he is now surveying hundreds of iPod users. Their consumption of music, he says, changes in three main ways.

The first and most important is that the iPod grants them far more control over how and where they listen to their music. Surely, you might ask, an iPod is no different from a cassette or CD-based player, since you can always carry a few tapes or discs with you? But most people, says Dr Bull, find that if none of the music they are carrying with them fits their mood, they prefer not to listen to music at all. The large capacity of a hard-disk-based player does away with this problem. The right music can always be summoned up depending on your mood, the time of day, and your activity, says Dr Bull. As a result, iPod users tend to listen to particular music duri

Ha, the best cover they ever had was the one from when Kim Il-Jong reached out to the world: Greetings, earthlings

Other good covers:
Greatest danger, or greatest hope?
Will the real Al Gore please stand up
Can it fly?
Mr Bush goes to Europe
Remember

Here's an archive of their covers going back to 2000.

Ha, the best cover they ever had was the one from when Kim Il-Jong reached out to the world: Greetings, earthlings

Other good covers:
Greatest danger, or greatest hope?
Will the real Al Gore please stand up
Can it fly?
Mr Bush goes to Europe
Remember

Here's an archive of their covers going back to 2000.

Ha, the best cover they ever had was the one from when Kim Il-Jong reached out to the world: Greetings, earthlings

Other good covers:
Greatest danger, or greatest hope?
Will the real Al Gore please stand up
Can it fly?
Mr Bush goes to Europe
Remember

Here's an archive of their covers going back to 2000.

Ha, the best cover they ever had was the one from when Kim Il-Jong reached out to the world: Greetings, earthlings

Other good covers:
Greatest danger, or greatest hope?
Will the real Al Gore please stand up
Can it fly?
Mr Bush goes to Europe
Remember

Here's an archive of their covers going back to 2000.

Ha, the best cover they ever had was the one from when Kim Il-Jong reached out to the world: Greetings, earthlings

Other good covers:
Greatest danger, or greatest hope?
Will the real Al Gore please stand up
Can it fly?
Mr Bush goes to Europe
Remember

Here's an archive of their covers going back to 2000.

Ha, the best cover they ever had was the one from when Kim Il-Jong reached out to the world: Greetings, earthlings

Other good covers:
Greatest danger, or greatest hope?
Will the real Al Gore please stand up
Can it fly?
Mr Bush goes to Europe
Remember

Here's an archive of their covers going back to 2000.

Ha, the best cover they ever had was the one from when Kim Il-Jong reached out to the world: Greetings, earthlings

Other good covers:
Greatest danger, or greatest hope?
Will the real Al Gore please stand up
Can it fly?
Mr Bush goes to Europe
Remember

Here's an archive of their covers going back to 2000.

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

The article does not strictly deal with this most recent release of Apache, but it is mentioned in this article as an example of open source's successes. The rest of the article is certainly worth reading, if only for a well-argued perspective on the strengths and weaknesses of open source.

----

Open source

Beyond capitalism?

Jun 10th 2004
From The Economist print edition

The open-source model can be applied to goods other than software, but it has its limits

THAT "open source" is a good way to make software is beyond question. For those unfamiliar with the term, the open-source model allows many people to collaborate on the development of a piece of software by making its underlying programming instructions, or source code, open to everyone, usually by publishing them on the internet. The resulting program is then given away too: open-source software is shared, not sold. Commercial software vendors, by contrast, jealously guard their source code because only by keeping it secret can they protect their ability to demand money for their products.

[Image]

By far the best-known example of open-source software is Linux, an operating system that is maintained by volunteers around the world, runs on everything from wristwatches to mainframes and now powers one in five of the world's server computers. Open source's other successes include Apache, a piece of software that powers two-thirds of the world's web servers, Sendmail, a program that dispatches most of the world's e-mail, and MySQL, a database program.

Advocates of open source argue that it produces software that is secure, reliable and, of course, cheap. All this is clearly true, despite the fact that open source's opponents--chief among them Microsoft, the world's largest software company--try to deny it. Now many people want to apply the open-source model in many fields other than software. There is already an open-source cola recipe, an open-source encyclopedia and open-source academic journals. The model is also being applied in medical research (see article). Some zealots even argue that the open-source approach represents a new, post-capitalist model of production. Are there no limits to the power of open source?

Of course there are. The model is particularly well suited to information-rich goods, of which software is merely the most obvious example, since it is pure information. The surprisingly good open-source encyclopedia (see Wikipedia.org) is another example. Like software, it is modular, which allows different people to work on different bits. Drugs, too, are information-rich goods, and searching for candidate molecules and performing clinical trials may be amenable to open-source-style distributed collaboration. So far, so good. But building, say, an open-source car is rather more problematic, since information (in the form of design and specifications) constitutes only a minor ingredient: the costs of materials and manufacturing would remain. Until someone invents a "universal replicator" capable of synthesising any object from software specifications, it is hard to see how the open-source model can be applied to manufactured goods.

The model has other limitations as well. It is not clear, for example, that the open-source model can be genuinely innovative--most open-source software merely imitates existing commercial products. Furthermore, the open-source software movement is driven by the desire to dethrone the proprietary software model, embodied by Microsoft. This shared g

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

The article does not strictly deal with this most recent release of Apache, but it is mentioned in this article as an example of open source's successes. The rest of the article is certainly worth reading, if only for a well-argued perspective on the strengths and weaknesses of open source.

----

Open source

Beyond capitalism?

Jun 10th 2004
From The Economist print edition

The open-source model can be applied to goods other than software, but it has its limits

THAT "open source" is a good way to make software is beyond question. For those unfamiliar with the term, the open-source model allows many people to collaborate on the development of a piece of software by making its underlying programming instructions, or source code, open to everyone, usually by publishing them on the internet. The resulting program is then given away too: open-source software is shared, not sold. Commercial software vendors, by contrast, jealously guard their source code because only by keeping it secret can they protect their ability to demand money for their products.

[Image]

By far the best-known example of open-source software is Linux, an operating system that is maintained by volunteers around the world, runs on everything from wristwatches to mainframes and now powers one in five of the world's server computers. Open source's other successes include Apache, a piece of software that powers two-thirds of the world's web servers, Sendmail, a program that dispatches most of the world's e-mail, and MySQL, a database program.

Advocates of open source argue that it produces software that is secure, reliable and, of course, cheap. All this is clearly true, despite the fact that open source's opponents--chief among them Microsoft, the world's largest software company--try to deny it. Now many people want to apply the open-source model in many fields other than software. There is already an open-source cola recipe, an open-source encyclopedia and open-source academic journals. The model is also being applied in medical research (see article). Some zealots even argue that the open-source approach represents a new, post-capitalist model of production. Are there no limits to the power of open source?

Of course there are. The model is particularly well suited to information-rich goods, of which software is merely the most obvious example, since it is pure information. The surprisingly good open-source encyclopedia (see Wikipedia.org) is another example. Like software, it is modular, which allows different people to work on different bits. Drugs, too, are information-rich goods, and searching for candidate molecules and performing clinical trials may be amenable to open-source-style distributed collaboration. So far, so good. But building, say, an open-source car is rather more problematic, since information (in the form of design and specifications) constitutes only a minor ingredient: the costs of materials and manufacturing would remain. Until someone invents a "universal replicator" capable of synthesising any object from software specifications, it is hard to see how the open-source model can be applied to manufactured goods.

The model has other limitations as well. It is not clear, for example, that the open-source model can be genuinely innovative--most open-source software merely imitates existing commercial products. Furthermore, the open-source software movement is driven by the desire to dethrone the proprietary software model, embodied by Microsoft. This shared g

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

The article does not strictly deal with this most recent release of Apache, but it is mentioned in this article as an example of open source's successes. The rest of the article is certainly worth reading, if only for a well-argued perspective on the strengths and weaknesses of open source.

----

Open source

Beyond capitalism?

Jun 10th 2004
From The Economist print edition

The open-source model can be applied to goods other than software, but it has its limits

THAT "open source" is a good way to make software is beyond question. For those unfamiliar with the term, the open-source model allows many people to collaborate on the development of a piece of software by making its underlying programming instructions, or source code, open to everyone, usually by publishing them on the internet. The resulting program is then given away too: open-source software is shared, not sold. Commercial software vendors, by contrast, jealously guard their source code because only by keeping it secret can they protect their ability to demand money for their products.

[Image]

By far the best-known example of open-source software is Linux, an operating system that is maintained by volunteers around the world, runs on everything from wristwatches to mainframes and now powers one in five of the world's server computers. Open source's other successes include Apache, a piece of software that powers two-thirds of the world's web servers, Sendmail, a program that dispatches most of the world's e-mail, and MySQL, a database program.

Advocates of open source argue that it produces software that is secure, reliable and, of course, cheap. All this is clearly true, despite the fact that open source's opponents--chief among them Microsoft, the world's largest software company--try to deny it. Now many people want to apply the open-source model in many fields other than software. There is already an open-source cola recipe, an open-source encyclopedia and open-source academic journals. The model is also being applied in medical research (see article). Some zealots even argue that the open-source approach represents a new, post-capitalist model of production. Are there no limits to the power of open source?

Of course there are. The model is particularly well suited to information-rich goods, of which software is merely the most obvious example, since it is pure information. The surprisingly good open-source encyclopedia (see Wikipedia.org) is another example. Like software, it is modular, which allows different people to work on different bits. Drugs, too, are information-rich goods, and searching for candidate molecules and performing clinical trials may be amenable to open-source-style distributed collaboration. So far, so good. But building, say, an open-source car is rather more problematic, since information (in the form of design and specifications) constitutes only a minor ingredient: the costs of materials and manufacturing would remain. Until someone invents a "universal replicator" capable of synthesising any object from software specifications, it is hard to see how the open-source model can be applied to manufactured goods.

The model has other limitations as well. It is not clear, for example, that the open-source model can be genuinely innovative--most open-source software merely imitates existing commercial products. Furthermore, the open-source software movement is driven by the desire to dethrone the proprietary software model, embodied by Microsoft. This shared g

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

While not strictly related to this teenager's arrest, the article below does provide insight on how the film industry might better accomplish its goal of keeping bootleggers at bay.

----

Piracy and the movie business

Tipping Hollywood the black spot

Aug 28th 2003
From The Economist print edition

[Image]

The movie business is not doing enough to ward off the threat of digital piracy

AS HOLLYWOOD bosses know all too well, digital piracy could plunder their industry. The music business, where piracy has long been active, has lost a quarter of its sales already. Watching its plight, the movie moguls say, has taught them a lesson: listen to what the customer wants and keep the business model flexible. But investors are not convinced that Hollywood's leaders are on top of the piracy threat. Like Scarlett O'Hara in "Gone with the Wind", says Gordon Crawford, an investor at Capital Research and Management in Los Angeles, many have decided to do something about it tomorrow.

It is true that movies are not yet as vulnerable as music. Hollywood starts from a better position. Its products are priced more reasonably than CDs. People want to watch all of a film, so there is no incentive to download a single track. It can take days to download a movie from the internet, unlike a song, which takes minutes.

But rampant DVD piracy may be coming soon, both in the form of traditional counterfeiting and downloading from the internet. Hard pirated copies are widespread, and will proliferate further with the spread of DVD recorders and burners. Already as many as 600,000 movie files are shared each day on peer-to-peer file-sharing networks such as Morpheus and Grokster, according to the Motion Picture Association of America (MPAA). That number is likely to soar as more households get broadband internet and compression technology cuts download time.

Movie industry bosses say that they are doing plenty to combat the threat. As well as helping local police with raids on counterfeiters, they are devising "digital rights management" (DRM) techniques, such as deleting content after the user has "consumed" it. They are also offering movies cheaply online and seeking new laws. This week they won a battle against pirates when California's Supreme Court ruled that the First Amendment right to free speech cannot be used as a defence by someone publishing trade secrets on the internet--in this case, software to break DVD copy protection.

American Pie-in-the-sky

Next will come an Orwellian project to "re-educate" the young. With Junior Achievement, a volunteer teaching organisation, the MPAA has developed a curriculum for use in 36,000 American classrooms which teaches that swapping content is wrong. Older file sharers will be hard to persuade, however, and hackers can usually get around any copy protection the industry devises. According to the Pew Internet & American Life Project, 65% of people who share music and video files online say they do not care if material is copyrighted. Last month, the MPAA tried an emotional approach, with a series of adverts in which a set painter, a stuntman, a make-up artist, a grip and an animator explain how piracy hurts them, not just the big bosses. The campaign is unlikely to have much effect, industry-watchers say, as everyone knows how many millions the latest blockbuster grossed and how much the star got.

To frighten people, the big music firms are going after individuals in court. Movie firms reckon that this will help them too, though for now they are leaning on universities to stop their students file-sharing. One studio s

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

While not strictly related to this teenager's arrest, the article below does provide insight on how the film industry might better accomplish its goal of keeping bootleggers at bay.

----

Piracy and the movie business

Tipping Hollywood the black spot

Aug 28th 2003
From The Economist print edition

[Image]

The movie business is not doing enough to ward off the threat of digital piracy

AS HOLLYWOOD bosses know all too well, digital piracy could plunder their industry. The music business, where piracy has long been active, has lost a quarter of its sales already. Watching its plight, the movie moguls say, has taught them a lesson: listen to what the customer wants and keep the business model flexible. But investors are not convinced that Hollywood's leaders are on top of the piracy threat. Like Scarlett O'Hara in "Gone with the Wind", says Gordon Crawford, an investor at Capital Research and Management in Los Angeles, many have decided to do something about it tomorrow.

It is true that movies are not yet as vulnerable as music. Hollywood starts from a better position. Its products are priced more reasonably than CDs. People want to watch all of a film, so there is no incentive to download a single track. It can take days to download a movie from the internet, unlike a song, which takes minutes.

But rampant DVD piracy may be coming soon, both in the form of traditional counterfeiting and downloading from the internet. Hard pirated copies are widespread, and will proliferate further with the spread of DVD recorders and burners. Already as many as 600,000 movie files are shared each day on peer-to-peer file-sharing networks such as Morpheus and Grokster, according to the Motion Picture Association of America (MPAA). That number is likely to soar as more households get broadband internet and compression technology cuts download time.

Movie industry bosses say that they are doing plenty to combat the threat. As well as helping local police with raids on counterfeiters, they are devising "digital rights management" (DRM) techniques, such as deleting content after the user has "consumed" it. They are also offering movies cheaply online and seeking new laws. This week they won a battle against pirates when California's Supreme Court ruled that the First Amendment right to free speech cannot be used as a defence by someone publishing trade secrets on the internet--in this case, software to break DVD copy protection.

American Pie-in-the-sky

Next will come an Orwellian project to "re-educate" the young. With Junior Achievement, a volunteer teaching organisation, the MPAA has developed a curriculum for use in 36,000 American classrooms which teaches that swapping content is wrong. Older file sharers will be hard to persuade, however, and hackers can usually get around any copy protection the industry devises. According to the Pew Internet & American Life Project, 65% of people who share music and video files online say they do not care if material is copyrighted. Last month, the MPAA tried an emotional approach, with a series of adverts in which a set painter, a stuntman, a make-up artist, a grip and an animator explain how piracy hurts them, not just the big bosses. The campaign is unlikely to have much effect, industry-watchers say, as everyone knows how many millions the latest blockbuster grossed and how much the star got.

To frighten people, the big music firms are going after individuals in court. Movie firms reckon that this will help them too, though for now they are leaning on universities to stop their students file-sharing. One studio s

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

High-speed rail

Trop peu, trop tard, trop Amtrak

Aug 9th 2001 | CHICAGO
From The Economist print edition

Fast trains may be coming to the mid-west--and stopping too often

THE roads are clogged. The airports are worse. Might fast trains provide relief for America's frustrated travellers? A coalition of nine mid-western states has plans for a rail system that would whisk travellers between the region's big cities at high speeds and connect them to points beyond with a network of slower trains and buses. Strangely enough, Congress, which would have to pay much of the cost, is warming to the idea.

The Midwest Regional Rail Initiative (MWRRI) is a joint venture between nine state transport agencies, the Amtrak rail system and the Federal Railroad Administration. The coalition has unveiled detailed plans and cost estimates for a 3,000-mile rail system with Chicago as its hub that would connect cities such as Detroit, Milwaukee, St Louis and Minneapolis at speeds of up to 110 miles per hour (some 50-75mph slower than French or Japanese trains, but enough to wow the mid-west).

[Image]

Randy Wade at Wisconsin's Department of Transportation claims that the region is ideally suited for high-speed rail. Over distances of several hundred miles, such as the 280-mile trip from Chicago to Detroit, rail is potentially faster, more comfortable and more productive than car travel. It should be cheaper than flying and delivers passengers into the city centre, rather than to distant airports. And cities in the mid-west are already connected by freight rail lines that can be upgraded to accommodate faster trains. MWRRI thinks that a well-run system could attract nearly 10m riders a year by 2010.

Such transport visions are two a penny and often worth as much (ask any Eurotunnel shareholder). The General Accounting Office recently estimated the cost of a national high-speed system to be $50 billion-70 billion. But both the Senate and the House are considering bills that would enable Amtrak, America's quasi-public passenger rail agency, to issue up to $12 billion in bonds to pay for capital improvements in 11 designated high-speed rail corridors. The bonds would not pay interest; bondholders would receive federal income-tax credits instead.

Such stealth subsidies are unlikely to irritate voters, impatient with traffic jams and cancelled flights. "You can't imagine congestion getting better anywhere--ever," says Mr Wade. Tom Daschle and Trent Lott, the Democratic and Republican leaders, are among the bill's 51 co-sponsors in the Senate. The White House has not taken a position yet; but, while he was governor of Texas, George Bush cut the ribbon when Amtrak began running the Texas Eagle from San Antonio to Chicago.

The bill making its way through Congress would provide a down-payment on the MWRRI plan, which can be built step by step. The full system will need lots more money, to pay among other things for the trains and improved infrastructure. Even supporters concede that high-speed rail would do well to cover its operating costs, never mind the capital investment. Politicians will have to be sold on the social benefits of getting Americans off the highways and runways.

Which they might be, except for the most potent enemy of passenger rail in America: Amtrak itself. Critics of federal spending for high-speed rail do not oppose the idea in principle; they just think that giving Amtrak control over something like $12 billion in capital spending is insane.

America's passenger rail system, which was deregulated in 1997, is supposed to cover its operating costs by December

The full text of this article from The Economist follows. The original content is subscriber-only; it is reproduced here in the hope and expectation that you will find it useful.

----

High-speed rail

Trop peu, trop tard, trop Amtrak

Aug 9th 2001 | CHICAGO
From The Economist print edition

Fast trains may be coming to the mid-west--and stopping too often

THE roads are clogged. The airports are worse. Might fast trains provide relief for America's frustrated travellers? A coalition of nine mid-western states has plans for a rail system that would whisk travellers between the region's big cities at high speeds and connect them to points beyond with a network of slower trains and buses. Strangely enough, Congress, which would have to pay much of the cost, is warming to the idea.

The Midwest Regional Rail Initiative (MWRRI) is a joint venture between nine state transport agencies, the Amtrak rail system and the Federal Railroad Administration. The coalition has unveiled detailed plans and cost estimates for a 3,000-mile rail system with Chicago as its hub that would connect cities such as Detroit, Milwaukee, St Louis and Minneapolis at speeds of up to 110 miles per hour (some 50-75mph slower than French or Japanese trains, but enough to wow the mid-west).

[Image]

Randy Wade at Wisconsin's Department of Transportation claims that the region is ideally suited for high-speed rail. Over distances of several hundred miles, such as the 280-mile trip from Chicago to Detroit, rail is potentially faster, more comfortable and more productive than car travel. It should be cheaper than flying and delivers passengers into the city centre, rather than to distant airports. And cities in the mid-west are already connected by freight rail lines that can be upgraded to accommodate faster trains. MWRRI thinks that a well-run system could attract nearly 10m riders a year by 2010.

Such transport visions are two a penny and often worth as much (ask any Eurotunnel shareholder). The General Accounting Office recently estimated the cost of a national high-speed system to be $50 billion-70 billion. But both the Senate and the House are considering bills that would enable Amtrak, America's quasi-public passenger rail agency, to issue up to $12 billion in bonds to pay for capital improvements in 11 designated high-speed rail corridors. The bonds would not pay interest; bondholders would receive federal income-tax credits instead.

Such stealth subsidies are unlikely to irritate voters, impatient with traffic jams and cancelled flights. "You can't imagine congestion getting better anywhere--ever," says Mr Wade. Tom Daschle and Trent Lott, the Democratic and Republican leaders, are among the bill's 51 co-sponsors in the Senate. The White House has not taken a position yet; but, while he was governor of Texas, George Bush cut the ribbon when Amtrak began running the Texas Eagle from San Antonio to Chicago.

The bill making its way through Congress would provide a down-payment on the MWRRI plan, which can be built step by step. The full system will need lots more money, to pay among other things for the trains and improved infrastructure. Even supporters concede that high-speed rail would do well to cover its operating costs, never mind the capital investment. Politicians will have to be sold on the social benefits of getting Americans off the highways and runways.

Which they might be, except for the most potent enemy of passenger rail in America: Amtrak itself. Critics of federal spending for high-speed rail do not oppose the idea in principle; they just think that giving Amtrak control over something like $12 billion in capital spending is insane.

America's passenger rail system, which was deregulated in 1997, is supposed to cover its operating costs by December

Everything I subscribe to was on the list:
The Economist
Reason
Science News

But there are some really intriguing ones on that list. I was tempted.

Economist right wing? I find that a little hard to believe. This is not a magazine that is afraid to criticize the Bushies (on the other hand, sometimes they have good things to say about Republicans too).

Economist right wing? I find that a little hard to believe. This is not a magazine that is afraid to criticize the Bushies (on the other hand, sometimes they have good things to say about Republicans too).

Economist right wing? I find that a little hard to believe. This is not a magazine that is afraid to criticize the Bushies (on the other hand, sometimes they have good things to say about Republicans too).

I would have posted about the Economist myself, except that the topic was which PC magazines you read, not general interest magazines. Still, the Economist comes out with a quarterly technology issue (the latest one covers smart fluids, smart dust, wireless recharging and congestion charges, among other things) and it's not only informative but highly entertaining. Oh, and there's an article this week on "the smart tag revolution". Definitely worth a look.