I know Linux would have been free if I wasn't so damn lazy that I spent real money on a RH CD.
What is interesting here is that people are sueing MS on (as I understand it) the grounds that they were overcharged for the OS. The reason they think this is that MS is a monopoly, so under classic economic principles, it must be overcharging. But, it seems that MS wasn't obeying this principle... it seems probable they could have been charging far more for the OS. I doubt any court would consider $0 to be the fair price, and comparable products that are commercially developed and sold cost... what? I don't know. (I also doubt that the people sueing are the companies that bought NT etc. They are probably users that bought 3.1, 95, 98, etc.)
So my question is, were these people really damaged in the way they are alleging? I agree that they, you, I and several companies I have worked for were all damaged in other ways by MS, but is this case a case that can be won?
Isn't this complaint about the one way Microsoft really didn't abuse its monopoly? My problem with the way MS acts is the crushing of competitors and the stifling of innovation, not the cost of Windows.
I don't know, how does the cost of Windows compare with the cost of other OSs?
Wow - this guy had to be insane. Not only trying to break into what must be one of the most difficult-to-crack industries in the world, but doing it on his own dime. I mean, he started in January 2000, when venture capitalists were still giving out money. What was he thinking?
Maybe we can start a support fund? We can all send in $1? Or we can pool our dollars and buy the company and publish his specs as an open-source-hardware game console.
Doug Miller, a Microsoft executive, was recently interviewed for Slashdot. Many of the questions posed were regarding the competitiveness of Linux with Windows in the medium-term. To paraphrase, Rob said that there was no viable business model based on Linux, that the lack of standardization (ie. KDE v. Gnome) would be enough of an economic disincentive to commercial application developers to prevent them from venturing into the market.
On the face of it, he seems to have a point. What do you think? Does Linux need to be herded down the path towards a super-majority recognized 'standard' to be successful, or can the type of open-source movement to date provide enough tools and applications to drive Linux to dominance?
I think he's both right and wrong.
We tend to visit sites that are also visited by other people like us, and not visit ones with people who have very different interests. But not every site is about politics, per se, so even sites populated by people like me in some respect are populated with people unlike me in other respects.
For instance, this site is host to some pretty vociferous arguments. Many of the people who post here have very different political viewpoints than mine. Some posts make my blood boil, yet I still keep reading. I read because this is a site about... about... well, I forget what this site is about, but there are generally pretty interesting things on it.
The most interesting idea in the review (haven't read the book yet) is the idea of a 'public service' link to a site about public policy. This could be the fee the government charges for its initial investment in the Internet. Reminds me of the boards in Ender's Game. The democratic system of government presupposes some intelligent public debate, and its long-term survival demands an informed populace, so the system of government (as opposed to the current government itself) might be well-served by this sort of thing. There are precedents to governments incenting their citizens to participate - some states in ancient Greece fined citizens that didn't vote in elections.
I think this is the sort of selflessness I used to expect from Universities before I went to one and found out what they are really like. A flaw in the capitalist system is the difficulty in price discrimination: charging people what they can afford for goods that have very low marginal cost but require a large investment. MIT is doing this by providing both the high-priced option (degree, professor support, community) and the no-price option (just the bare content - figure it out yourself). Maybe next is the low-price option (online community, email professor support, etc.)
Personally, I got a degree from an accredited university, but found that I taught myself everything (I learn better visually rather than audibly and was shy, so didn't find lectures or professor access very valuable.) Of course, having the degree lets me convince others that I actually learned something, which allows me to hold a better job, so it was worth the price.
A comprehensive computer science education is already out there on the web for anyone with a compelling interest to find. I taught myself Linux and C using only free resources on the web. The real benefit here might be if other universities started putting non-CS, non-engineering coursework up: economics, history, political science, business. These are pretty poorly represented right now. I think there are two audiences: people in less-developed countries that still have web access and older people who still have the desire to learn but don't have the time to go back to school. Falling into the second camp, I am eagerly looking forward to this and to other university efforts.
This doesn't bother me nearly as much as AudioGalaxy putting Webhancer on my hard disk. After reading the comments here I downloaded and ran AdAware and found it (thanks/.)
To think I actually trusted someone. BTW, AdAware is excellent.
I think even a loss of $600k is break-even per share when you have more than 168 million shares outstanding (that's a loss of $0.00357 per share, closer to zero than to a penny.)
As to their accounting (the difference between the $24 million GAAP net loss and the $600k adjusted loss), this is allowable by the SEC and reflects mainly one-time or non-cash charges. Although this sort of manipulation should always raise eyebrows, it is usually subject to intense scrutiny by the outside auditors in a company like this (by "like this" I mean small tech company with a big recent drop in stock price.) The outside auditors often are named as defendants in shareholder lawsuits because they (and the D&O insurance provider) are the only ones with a meaningful way to pay the claims.
The meaningful differences between GAAP and adjusted are:
- Goodwill amortization: this is a non-cash charge to account for a company that was acquired. Excluding this (as an investor) makes sense if the company is not in the business of acquiring companies - if it was unusual (everything here is IMHO, if I need a disclaimer);
- Stock-based compensation: although there are several explanations for this, the most usual one is that a company gave out options before they were public and the SEC said the strike prices were below "fair market value" later on - the difference needs to be amortized over the vesting of the options. Again, a non-cash charge and should be ignored by the investor if the company is not continuing to give out cheap stock;
- Merger, acquisition and other: this is usually the abused bucket. It's hard to know what is in here, if the expenses are cash or not, and if the expenses are actually recurring and not one-time (the company will say they are, of course, but hard to evaluate the truth of that, is what I mean). Luckily, it's the smallest of the numbers.
The proof will be next quarter - assuming they do no more acquisitions, will their operating cash-flow be positive? The only real value in a business is its ability to generate cash in the future, not its reported GAAP earnings. That is what RHAT is trying to tell the street with its adjustments: we are very close to generating cash with our business. Up to you if you believe them or not.
Well, no. Typically in an IPO, company A contracts with an investment bank to sell a specific number of shares at a specific price and gives the bank the option to sell an additional number of shares into the market (this overallotment is called the Greenshoe, or just the Shoe.) The company gets the specified price per share, less the underwriter's commission (which is so often 7% that the banks are being investigated for antitrust.)
Company A may later sell more shares, but it almost never gets to trickle them out, and is usually restricted by the underwriter from selling more within a specific period of time so as not to hurt the marketability of the initial offering. Any offering of shares by the company (a "primary" offering) is at a set price and is accompanied by all the government-is-your-friend paperwork required by the SEC. Shares that are not registered in an SEC filing can only be sold to the public under exemptions built into the law. These exemptions are typically for small offerings by individuals out onto the open market after a specific holding period (Rule 144 sales).
The investment bank may make quite a bit of money trickling out the shares in the shoe, but that is their money, not the company's. The company only gets the offering price, less commission.
The reason IPOs typically have a jump in price after they start trading is that the banker deliberately (and with knowledge of the company) underprices the deal. Anecdotally, the average IPO is discounted 15% for sale to institutions, meaning the institution expects to make about 15% by flipping their shares to the general public. This, in effect, compensates them for the risk they take in being part of the distribution network. Cynics would say it also makes them beholden to the i-banks for when harder to sell deals come around (like, which institutions would have bought Loudcloud without some favors being called in?) Institutions are well aware that (historically again, not just during bubble-mania) IPOs have less appreciation, on average, than the broader market - they are bad investments in the medium-term.
The company agrees to this underpricing for two reasons. The first is that they are negotiating the price with the investment bank. This deserves emphasis, because many managements believe that the investment bank is their *agent* in the sale. This is not true. The investment bank does not necessarily have the best interests of the company as their primary concern. In fact, given the volume of business from any one small company just going public versus the volume of business from incredibly large institutional investors that are active in every offering they do, you figure out who they want to please the most. What happens is that the night before public trading commences, management of the company and the the i-bankers sit down and negotiate the offering price. The management wants a high price, obviously, and the bankers want a price that will allow them to sell the deal and get a kick after public trading starts. They determine this price by callin the potential investors and feeling them out about their interest at different price levels. They want the deal to be two or three times oversold (demand for two or three times the number of shares being sold at the given price). This allows them to see some increase in price in the short-term. The second reason management doesn't want to overprice a deal is that if their stock price drops like a rock immediately after the offering, the chances of investors coming back in the next offering is small, limiting their ability to raise money or do a secondary in the future.
This whole field is so new that even the things that are completely obvious now may not have been 5 or 10 years ago. I remember a debate at my old employer about a patent they owned from 1989 or so that covered executable code delivered over a network - I don't remember the specifics, but you get the idea (I think the patent is this one: http://www.delphion.com/details?pn=US05347632__ ). The company decided it would be pretty difficult, if impossible, as well as counter-productive to try and enforce it. I believe that patent is now owned by IBM.
Now, I know a lot of the engineers here won't subscribe to my notion that ideas should be free and only implementation should be worth something, but shouldn't patents only be for a max of 2 or 3 years in this field? The government grants these mini-monopolies on ideas to encourage innovation, not supress it.
Thanks for this. Reading it reminded me of the days when we were in this for love, not money. Now that those days are back, it's good to remember that creativity, experimentation and community are the reasons we love the internet.
This is good. Hopefully it won't be as futile as most other efforts at tort reform.
Of course, it only addresses about 1% of the privacy problem here... AOL is still using its users' information for its own marketing purposes. It will still keep track of what its users do and use that data to market to them.
All the hype about privacy doesn't seem to have slowed down AOL's growth... I wonder if anyone (besides the geeks, journalists and politicians) really cares. Or do they just not understand?
The Sovereignty issue cuts both ways... if Sealand is truly sovereign then any action by the RIAA might not be illegal, except perhaps under the law of Sealand.
It wouldn't be the first time a private entity got involved in foreign "adventures": the East India company replaced the native government of India with its own (only later replaced by the British government); Zimbabwe (nee Rhodesia), was colonized by the British South Africa company, led by Cecil Rhodes, and was governed by the company until 1923; and, not to unfairly malign the Brits, there are the days of dollar diplomacy in the early decades of the 20th century in Latin America when companies like United Fruit were accused of bribing local governments and organizing mercenary armies to protect their commercial interests.
Why wouldn't the RIAA hire mercenaries to shut down Sealand? They would be cheaper than lawyers.
Slashdot Mirror
What is interesting here is that people are sueing MS on (as I understand it) the grounds that they were overcharged for the OS. The reason they think this is that MS is a monopoly, so under classic economic principles, it must be overcharging. But, it seems that MS wasn't obeying this principle... it seems probable they could have been charging far more for the OS. I doubt any court would consider $0 to be the fair price, and comparable products that are commercially developed and sold cost... what? I don't know. (I also doubt that the people sueing are the companies that bought NT etc. They are probably users that bought 3.1, 95, 98, etc.)
So my question is, were these people really damaged in the way they are alleging? I agree that they, you, I and several companies I have worked for were all damaged in other ways by MS, but is this case a case that can be won?
I don't know, how does the cost of Windows compare with the cost of other OSs?
Maybe we can start a support fund? We can all send in $1? Or we can pool our dollars and buy the company and publish his specs as an open-source-hardware game console.
Doug Miller, a Microsoft executive, was recently interviewed for Slashdot. Many of the questions posed were regarding the competitiveness of Linux with Windows in the medium-term. To paraphrase, Rob said that there was no viable business model based on Linux, that the lack of standardization (ie. KDE v. Gnome) would be enough of an economic disincentive to commercial application developers to prevent them from venturing into the market.
On the face of it, he seems to have a point. What do you think? Does Linux need to be herded down the path towards a super-majority recognized 'standard' to be successful, or can the type of open-source movement to date provide enough tools and applications to drive Linux to dominance?
For instance, this site is host to some pretty vociferous arguments. Many of the people who post here have very different political viewpoints than mine. Some posts make my blood boil, yet I still keep reading. I read because this is a site about... about... well, I forget what this site is about, but there are generally pretty interesting things on it.
The most interesting idea in the review (haven't read the book yet) is the idea of a 'public service' link to a site about public policy. This could be the fee the government charges for its initial investment in the Internet. Reminds me of the boards in Ender's Game. The democratic system of government presupposes some intelligent public debate, and its long-term survival demands an informed populace, so the system of government (as opposed to the current government itself) might be well-served by this sort of thing. There are precedents to governments incenting their citizens to participate - some states in ancient Greece fined citizens that didn't vote in elections.
Of course, it's next to impossible to get into.
Personally, I got a degree from an accredited university, but found that I taught myself everything (I learn better visually rather than audibly and was shy, so didn't find lectures or professor access very valuable.) Of course, having the degree lets me convince others that I actually learned something, which allows me to hold a better job, so it was worth the price.
A comprehensive computer science education is already out there on the web for anyone with a compelling interest to find. I taught myself Linux and C using only free resources on the web. The real benefit here might be if other universities started putting non-CS, non-engineering coursework up: economics, history, political science, business. These are pretty poorly represented right now. I think there are two audiences: people in less-developed countries that still have web access and older people who still have the desire to learn but don't have the time to go back to school. Falling into the second camp, I am eagerly looking forward to this and to other university efforts.
To think I actually trusted someone. BTW, AdAware is excellent.
As to their accounting (the difference between the $24 million GAAP net loss and the $600k adjusted loss), this is allowable by the SEC and reflects mainly one-time or non-cash charges. Although this sort of manipulation should always raise eyebrows, it is usually subject to intense scrutiny by the outside auditors in a company like this (by "like this" I mean small tech company with a big recent drop in stock price.) The outside auditors often are named as defendants in shareholder lawsuits because they (and the D&O insurance provider) are the only ones with a meaningful way to pay the claims.
The meaningful differences between GAAP and adjusted are:
- Goodwill amortization: this is a non-cash charge to account for a company that was acquired. Excluding this (as an investor) makes sense if the company is not in the business of acquiring companies - if it was unusual (everything here is IMHO, if I need a disclaimer);
- Stock-based compensation: although there are several explanations for this, the most usual one is that a company gave out options before they were public and the SEC said the strike prices were below "fair market value" later on - the difference needs to be amortized over the vesting of the options. Again, a non-cash charge and should be ignored by the investor if the company is not continuing to give out cheap stock;
- Merger, acquisition and other: this is usually the abused bucket. It's hard to know what is in here, if the expenses are cash or not, and if the expenses are actually recurring and not one-time (the company will say they are, of course, but hard to evaluate the truth of that, is what I mean). Luckily, it's the smallest of the numbers.
The proof will be next quarter - assuming they do no more acquisitions, will their operating cash-flow be positive? The only real value in a business is its ability to generate cash in the future, not its reported GAAP earnings. That is what RHAT is trying to tell the street with its adjustments: we are very close to generating cash with our business. Up to you if you believe them or not.
Company A may later sell more shares, but it almost never gets to trickle them out, and is usually restricted by the underwriter from selling more within a specific period of time so as not to hurt the marketability of the initial offering. Any offering of shares by the company (a "primary" offering) is at a set price and is accompanied by all the government-is-your-friend paperwork required by the SEC. Shares that are not registered in an SEC filing can only be sold to the public under exemptions built into the law. These exemptions are typically for small offerings by individuals out onto the open market after a specific holding period (Rule 144 sales).
The investment bank may make quite a bit of money trickling out the shares in the shoe, but that is their money, not the company's. The company only gets the offering price, less commission.
The reason IPOs typically have a jump in price after they start trading is that the banker deliberately (and with knowledge of the company) underprices the deal. Anecdotally, the average IPO is discounted 15% for sale to institutions, meaning the institution expects to make about 15% by flipping their shares to the general public. This, in effect, compensates them for the risk they take in being part of the distribution network. Cynics would say it also makes them beholden to the i-banks for when harder to sell deals come around (like, which institutions would have bought Loudcloud without some favors being called in?) Institutions are well aware that (historically again, not just during bubble-mania) IPOs have less appreciation, on average, than the broader market - they are bad investments in the medium-term.
The company agrees to this underpricing for two reasons. The first is that they are negotiating the price with the investment bank. This deserves emphasis, because many managements believe that the investment bank is their *agent* in the sale. This is not true. The investment bank does not necessarily have the best interests of the company as their primary concern. In fact, given the volume of business from any one small company just going public versus the volume of business from incredibly large institutional investors that are active in every offering they do, you figure out who they want to please the most. What happens is that the night before public trading commences, management of the company and the the i-bankers sit down and negotiate the offering price. The management wants a high price, obviously, and the bankers want a price that will allow them to sell the deal and get a kick after public trading starts. They determine this price by callin the potential investors and feeling them out about their interest at different price levels. They want the deal to be two or three times oversold (demand for two or three times the number of shares being sold at the given price). This allows them to see some increase in price in the short-term. The second reason management doesn't want to overprice a deal is that if their stock price drops like a rock immediately after the offering, the chances of investors coming back in the next offering is small, limiting their ability to raise money or do a secondary in the future.
Now, I know a lot of the engineers here won't subscribe to my notion that ideas should be free and only implementation should be worth something, but shouldn't patents only be for a max of 2 or 3 years in this field? The government grants these mini-monopolies on ideas to encourage innovation, not supress it.
Thanks for this. Reading it reminded me of the days when we were in this for love, not money. Now that those days are back, it's good to remember that creativity, experimentation and community are the reasons we love the internet.
Of course, it only addresses about 1% of the privacy problem here... AOL is still using its users' information for its own marketing purposes. It will still keep track of what its users do and use that data to market to them.
All the hype about privacy doesn't seem to have slowed down AOL's growth... I wonder if anyone (besides the geeks, journalists and politicians) really cares. Or do they just not understand?
It wouldn't be the first time a private entity got involved in foreign "adventures": the East India company replaced the native government of India with its own (only later replaced by the British government); Zimbabwe (nee Rhodesia), was colonized by the British South Africa company, led by Cecil Rhodes, and was governed by the company until 1923; and, not to unfairly malign the Brits, there are the days of dollar diplomacy in the early decades of the 20th century in Latin America when companies like United Fruit were accused of bribing local governments and organizing mercenary armies to protect their commercial interests.
Why wouldn't the RIAA hire mercenaries to shut down Sealand? They would be cheaper than lawyers.