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Industry Threatened by Innovation at the 'Edge'?
penciling_in writes "In an article on CircleID, Bob Frankston, best known as the co-developer of the legendary VisiCalc and Lotus Express, shares his concern regarding industries desperate effort to control 'the edge' -- VoIP, P2P, Video on Demand... 'The commoditization of the transport is making it increasingly difficult to make money just because you own the pipe. The cable industries have a long history of owning the content and demanding a share in companies whose signals they deign to carry. As gatekeepers they have the ability to command a high fee for passage. The problem is that the scarcity is going away and with the shift to narrowcasting (as in Video on Demand) there is no scarcity. Instead they must own the content themselves if they are to retain any advantage.
The Comcast/Disney issue (see: Comcast Family Protects Power) is portrayed as a media consolidation and convergence but that doesn't make sense. With transport becoming increasingly abundant it is easier for new players to enter the market and we should see increasing divergence once millions of people can experiment with new ideas.'"
When new technologies appear and make things more convinent, someone who was making money off the older technology loses out. Some companies want to simply protect their revenue without either pre-empting the change in technology or changing after a new technology has been adopted by the mainstream.
If VoIP became mainstream, how many telephone companies would go bankrupt? how many would fight tooth and nail to implement measures that would ensure that they got a piece of the pie?
Be you Admins? nay, we are but lusers!
Content-delivery ain't what it used to be. Joe Bob Basement Studio can put his mp3's in the same pipeline that Mega-Record Pimp Corp can.
.mp3 track these days, far and wide, to all and sundry, and it can be done very, very, effectively.
...
The difference is, whether people will pay attention to you or not - not whether they -can- through whatever means are available, but whether they will.
At ampfea.org we've been gathering together, as a crew of Artists, to present a united front and stable base of operations for use by our individual members to use for promoting their artistic efforts.
This is the future. There's no -need- any more for media giants banded together to share/consume resources for promotion, there is now the need for Content Producers to cut through the dreck and get good material online, and deliverable. It costs nothing to promote an
I see the day when those 80's Golden Dreams of media control in the hands of the people is actually feasible. Lets hope we avoid some of those other predictions
; -- the corruption of government starts with its secrets. a truly free people keep no secrets. --
Imagine purchasing your shows direct from the producing company. One new copy made available per week. Mine to download and then view when I felt like it. No 'channels' or 'networks' in the traditional sense.
No adds.
Or another scenario; I live in a large city ( > 4 million). Only the very largest of companies can afford to advertise. With narrowcasting a sort of advertising model could be supported where a small business might only choose to advertise in a 2km radius - or maybe only to profiled recieptients.
Dunnno.... but things have got to get better.
AC
You might not know but the inventor of print, Gutenberg did not want to print large volumes of books - he wanted to print books that would look similar to the hand-copied ones (hence fancy font and illuminations) - see the Gutenberg bible - these were the incunabuli
He wanted to make much money. Were it not for his followers that stole his invention and started mass production of books (very similar to those we now nowadays - set up in antiqua typeface) that cheap books started to exist and made wide dissemination of knowledge possible.
If there were patents in Medieval Times, surely Gutenberg would obtain a one, and no print as we know it would be possible.
You can defy gravity... for a short time
> Why is "industry" so surprised? This is what
> capitalism is supposed to be about; the
> inefficient are driven to extinction and new,
> more efficient players take their place. They
> have to take the good with the bad and shouldn't
> be allowed to legislate protection everytime the > wind blows their way.
well, it's a slippery slope: once you start
taking the good, and then take the bad,
and then you take them both and there you have, the facts
of life, the facts of life.
especially when the world never seems, to be living up to your
dreams and
suddenly you're
finding out the facts of life are all about you.
yooouuuuuu.
that's why the industry is so surprised:
it's obvious that it's going to happen, it just
wasn't clear to them that it was eventually going
to happen to *them*.
The problem of content and transmission today have to do with one thing - making money for someone. Everybody thinks in terms of paying for either bandwidth speed or throughput, or paying for content exclusive to one provider. This is not going to get us anywhere.
What I envision is much simpler - pay for a piece of hardware once(high speed wireless transmitter/receiver with intelligent peer routing), and then the bandwidth is not paid for by anyone, because there's no traditional infrastructure to set up. If a company would just make this type of equipment it could set free all those who currently are beholden to their ISP/cable companies for "giving" them a certain amount of bandwidth in exchange for $$$. If you make these wireless internet nodes in such a way that they auto-aggregate and reorder themselves based on surrounding nodes, you would effectively have unlimited bandwidth (to the limit of transmission tech of course) not monopolised by anyone. Much like Bittorrent, the more nodes you had, the faster it would be. Conversely, you could have high power models for remote areas to transmit/receive further.
It's a paradigm shift in thinking (since the very notion of not needing to pay constantly for access is foreign to most), and I don't have all the technical answers to this sort of idea, but surely the idea itself has merit?
Visceral Psyche Films
You certainly do not need a so-called Internet Service Provider.
So, what would it take to create your own access point?
The costs of transmission will decrease for every new technology as it is used and matures. However, it isn't cheap to maintain a large network since it becomes less expensive, but it never becomes cheap.
Technology is only one variable; people, law, markets, etc. all have to be factored in. It isn't so easy to predict the death of an organization since it has options for staying alive that you didn't consider. As much as I don't like Verizon either (especially the old Nynex part), they have managed to stick around.
Being a content provider is no guarantee of success. There have been more than a few spectacular failures of media companies (Vivendi comes to mind as a recent one).
On a side note, I have always wondered why the 5 or 6 largest ISPs never tried to build a true cartel (aside from the law).
In the land of the blind, the one-eyed man is usually crucified.
Were it not for his followers that stole his invention and started mass production of books (very similar to those we now nowadays - set up in antiqua typeface) that cheap books started to exist and made wide dissemination of knowledge possible.
If there were patents in Medieval Times, surely Gutenberg would obtain a one, and no print as we know it would be possible.
It's an interesting hypothetical situation but you've got the outcome wrong!
(For the moment, let us ignore the chicken and egg problem of actually making copies of such a patent.....)
Patents only last for, at most, 2 decades. Let's say Gutenberg did patent his press. Once the patent expired everybody would be legally entitled to make their own press.
In the mean time, because Gutenberg has had to put down a detailed description, with diagrams, of how the printing press works, far more people will have got the opportunity to see how to build their own. Moreover, others may then seen ways to make it better.
In other words, instead of it being a trade secret, and hence kept hidden away slowing down the spread of printing, a patent would have helped speed up its adoption.
With all of our rampant cost cutting and large scale manufacturing we are rapidly entering an age in which the most expensive part of a product is the carton it's shipped in and the shelf space it occupies.
Look at phones. I am usually they guy who bitches about de-regulation, but I have a flat fee I pay that allows be to yak for an unlimited amount of time to anywhere in the US. The billing and tracking what call goes where costs more than providing the service, so many new providers are just charging a flat rate.
The same is true with roadways. The first highways were toll roads. Now, everyone chips in a little in tax money, and the roads are free. Well at least everywhere but the Northeast.
I used to love college because you had the meal plan. You pay and assload of money up front, but you get to stroll into the cafeteria and eat however much, or little, however many times you wanted.
To tell you the truth, the most expensive part of a resteraunt these days are the staff, rent, and utilities. The huge portions are so you don't feel ripped off for paying $10/plate. How long till some large chain starts a "membership" club. Pay a flat fee, and eat as often as you like. Just think of the line at checkout. There wouldn't be one.
"Learning is not compulsory... neither is survival."
--Dr.W.Edwards Deming
Artificial Intelligence -- not just the Cable Industry -- is another battleground where innovation at the Edge threatens the entire Industry Establishment, yessiree Bob Frankston right-on bro'.
Artificial intelligence has been solved at the edges and fringes of the field and not by the dinosaurs of the AI Establishment.
The Edge is bypassing the AI Establishment -- just like in the collapsing free-for-all of the Cable Industry.
With accusations of kookery at the Edge, the AI Establishment (DFKI etc.) is fighting back and trying to discredit the Edge of AI, mais la verite est en marche, et rien ne l'arretera!
Artificil intelligence is evolving and multiplying in 'Net-wide Diaspora from the Edge back into the foundations of the AI Industry. Join in, or watch from the Edges?
I have been involved in a wireless ISP providing high speed Internet access to people in rural areas who can't get DSL. As innovative as our product is, as we use Motorola Canopy to get to the customers the phone company didn't want to spend the money on, our backend is still provided by...that same phone company. The phone company makes about 18,000-plus a year just on its T1 line to us. We get more customers and need another T1 or to go to a T3. The phone company makes even more off of us.
So the moral of the story is, don't discount owning the pipes. Some people may find a way around part of your business, but you can still stick it to your remaining customers for quite some time and get away with it!
Transporter
I'm going to be wearing a hockey mask when I go off on everyone...
Why can't I use my PC as a server? Why does my cable company ISP (and, I'm sure, most ADSL companies) get away with saying that "you can't use your PC as a server" policy.....the download speeds are sort of okay, the upload speeds are pathetic..I know people can use their PC's as servers (I think that most ISP's (in their contract with you) state that if you run a server, you'r screwed...these are the policies of outdated models...I should be able to have a server (you'd think so, with all the money it costs per month for so-called high speed internet access) on my PC..it's stupid that I when I want my own web page, I have to shell out $ to my ISP or somebody else to get one (and get billed $ for so many web accesses to it). This reeks of an overpriced model of access to the internet based on outmoded pricing structure that this article plainly states....these companies want and like, their old comfortable revenue generating models rammed down our throats and what us to be nice docile consumers (old cable model, one-way information flow (no creativity)), that's why people are not watching TV anymore, they are surfing on the net...why should I have to do what some bloated company wants...I am not here to make other people rich...this model of the service providers (cable TV and radio) can go into the garbage can of history for all I care...people should demand cheap realistic, yes, I can use my PC-as-fast-server,(not expensive $/bit one-way, based on some sort of expensive cell-phone type pricing structure) internet access...I am sure that as the pipes get 1000's of times faster in the future, (ie: cheap fiber to the door hardware), the concept of paying say, $40/month for internet access of say 1 gig/day is going to look very quaint in, say the next 5 to 10 years...these companies only want your money and will do anything (twist goverments, buyup and consolidate the whole panet if they have too)...it's unfortunate that some governments (bush, for instance) will probablly let this happen. Arn't the new internet standard supposed to make running your own server (from your PC) really easy to do, but most cable co's and tel co's don't like this?
The heart of the problem is that the layered approach to networking separates the costly parts (all those fibers, wires, switches, & routers) from the valuable parts (all the applicaitons and content). The internet does such a good job of running any application on any physical network, that nobody is willing to pay extra for transport. I don't care if I get my broadband via DSL, cabole, wireless, or the powerlines. And since transport involves such high sunk costs, once companies overbuild networks, they find they have no choice but to charge less than their debt payments just to make some money.
What people do value is the applications, software, and the content. Therefore, the only way to make a profit on the transport layer is to own some of the application layer. This is why AOL bought Time Warner, Comcast wants Disney, etc.
Two wrongs don't make a right, but three lefts do.
"The horse is dead, either f*ck it or walk away, but stop beating it."
You raise an interesting point: the only way an entrenched technology can fight innovation is if its supporters can get a government to intervene on its behalf.
The easiest way for an entrenched company to fight innovation is to do nothing: if your products require a large investment in capital then you probably won't have to fight innovation from anyone but other large companies, and if your products also require a large R&D budget then you probably won't have to fight innovation from anyone but other large companies in your field.
The second easiest way is to discourage competing innovations by demonstrating them to be a losing proposition for your competitors. If a significant competing project comes out of a smaller company, you sell your version at a loss, thus forcing your competitor to sell theirs at a loss, until they leave the market or are forced out of business. This will cause you to lose money in the short term on one product at a time, but will save you money in the long term as other companies realize they can't make money competing with you and decide to stay out of "your" markets in the first place.
Note that the second method is nearly impossible if you aren't already a monopoly in some markets and is technically illegal if you are; fortunately any legal costs and fines that result are unlikely to be substantial, and just act to slightly increase the cost of "dumping".
Before you wave the no-gubmint flag, consider that one function of government is to finance and run operations that are socially valuable and yet commercially unworkable. There isn't big profit in highways, fire departments and sewage treatment plants. It's hard to deny that we need it. If it becomes impossible to make money running pipes, they could become regulated. Or the government could buy up whole systems and contract out the maintenance at an acceptable profit. If things change, deregulation is always an option down the road (look at telcos).