Does the end of net neutrality mean the dream is dead?

Capitalism at its best offers a fantastic way for innovative ideas to get their moment in the sun.

The availability of capital to be risked has taken the world from kings and serfdom to a relatively amazing place. The modern industrial universe is on the internet.

So allowing the “owners” of the internet infrastructure to decide who gets to play and can charge different rates for different access is in effect removing the ability of disruptive technology to get a foot hold.

Why would a cable company want Netflix to thrive, it’s killing their old business model?

Why would a bank or insurance company want a financial service aggregator to thrive, they are forcing down prices.

Why would Google want a distributive search service to thrive, it’s could decimate their ad revenue?

Why would anyone who is in a position of power today want to allow new ideas that directly impact their current revenue stream to happen?

Well quite simply they would not.

Today a small number of very large business are intertwined and deliver the backbone and on and off-ramps to the internet. The law has until now required them to openly offer their services without consideration of the type of use their customers are putting the systems too. And this has allowed millions of new ideas to grow and be tried. Many have failed but some have become the best ideas of their time. Each one if them was disruptive, but with the end of net neutrality in the future many new ideas will not be able to compete, as the incumbents will have the ability to make disruption untenable though now legal aggressive pricing tactics.

Anyone who thinks this will not happen when net neutrality is removed just needs to look at every single other time when anti-competive ideas have been legal. Asking the wolf to guard the hen house never works. Business will always use every advantage it has, if it’s allowed it will be done. If its almost allowed it will be done. The only time a business acts ethically is when there is a material advantage in doing so. Many businesses talk about doing good, but that is simply because doing good things can be good for the balance sheet. Business is a matter of survival of the fittest, and when you allow the biggest to have a huge advantage they will always take it.

This is why rules that allow new ideas from new people to gain a foothold are so incredibly important. In the same way that the oil and car industries held back alternative fuels, electric cars and high speed rail, giving Comcast, Cisco, Google, AT&T and the rest of the current crop if internet giants a way to make new internet based ideas unprofitable can only be bad for capitalism. The rise and fall of the roman empire tells a deeply relevant story.

Let’s not allow the rise and fall of the internet to read the same way.


The only way is to “keep it moving”

Economics always seems very complex, and there is a reason for that. Like all mathematically impossible situations the only way to explain them is to make them seem too complex to explain.

Through all of human history the idea of exchange goods for services has required all the systems we see today, including, laws, education systems, policing, security etc.

Until a few decades ago the idea was that you would exchange services for things of equal value, such as a lump of gold or silvers or a bushel of corn. And to save carrying huge bags of gold around, notes were passed between people saying that they promised to provide the actual gold in exchange for a service. These notes of promise were called money. And to be able to make money you used to have to have a store of precious metals equal to the amount of money you printed.

And then someone has the really smart idea of getting rid of the need to actually have the store of gold to be able to print money. This allowed as much money to be made as was needed, to grow the economy. The only issue is that if anyone ever wanted to swap his or her money for gold the whole system would collapse.

So to make sure a collapse doesn’t happen there was an implicit need to make sure all the money keeps moving around. It’s like musical chairs where there are less chairs than people, so as long as everyone is moving there is no issue, but if the music was ever to stop there wouldn’t be enough places for all the money to sit, then the value of money goes down (inflation).

To make sure the money keeps moving governments used to tax money that was sitting still. This has two important effects:
1. Taxing money means it keeps moving by itself (moving to the government who could spend it on services)
2. Made it preferential for people to keep their money moving to keep it out of the hands of the taxman.

Today we have a huge issue in that the amount of tax applied to money that is not doing anything is too low to encourage people to keep it moving. This means that too much money is just sitting in banks making money without doing anything, and this is really bad, as sitting money can be seen for what it is, and that is a promise that can never be kept.

It’s okay to be rich; actually it’s the best thing to be. But the value of money will only get less if it does nothing of real value. Capitalism is without a doubt the best system the human race has ever had to build the quality and length of human life. But capitalism demands that capital be used to build stuff, it fails if it sits around doing nothing.

Tax lazy money to keep the capitalist system healthy. Either it moves to the government to spend, keeping it moving. Or it forces people to use their money to build things. Either way is much better than notes of promises that cannot be kept sitting in places where its lack of true value can be seen.


Car Renters Against Thrifty Car Rental

I hate Thrifty car rental with a passion

So what is the business of a car rental company? You would think it’s to rent cars, and you would imagine they would love customers who book in advance and then arrive at exactly the time they booked for to rent a car.

Well this is not the business model preferred by Thirfty car rental.

Last week we were in Vegas for a few days and decided it would be great to go for a hike in the Mohave desert, and pop in to Fry’s, my favorite geek out store on that side of the US. So we duly looked for a day’s car rental. We found Thrifty were at the airport, and so called them and booked a car for the next day. All confirmed and ready to go.

So the next day we dutifly took a taxi to the airport and went to the thrifty car rental desk, where we were told that they were not honoring reservations. Why I asked? Did you not have cars? And the stunning response was this “oh we have cars, but we are holding them in case any of our premier customers decide they might want one”.

So the facts were we had booked a reservation, they had a record of our reservation, they has cars available, but they chose to be assholes and not rent cars on the off-chance that a regular customer who had not made a reservation would want one.

The faster Thrifty go bankrupt the better, as far as I am concerned.

I will NEVER rent from them again. And I advise everyone I know will to NEVER rent from them again.

There is nothing worse than a business that does not understand why it is in business. Thrifty car rental, I wish you nothing but bankruptcy, your business model stinks.

I called Thrifty’s service department to complain and was unable to speak to a manager as none were in. I have not received a call back from them or any apology for their stupidity.

I think I’m going to found CRATCR, Car Renters Against Thrifty Car Rental, POWER TO THE PEOPLE!!!!!


What the hell is going on! oh right the same as always.

What the hell is going on!

Like most kids around the world, when I was at school I learnt of the history of the Brits who travelled to America to find solace free from religious and social tyranny.

It was held up as the pinnacle of freedom. A country driven to see all people as equal and to allow each individual the freedom to live their lives as they wished.

Of course the next chapter in that children’s history book did explain that all wasn’t perfect, with oppression of native people, rampant slavery, racism and sexism issues and a history of political corruption and political cowardice that pretty much matched the rest of the world. I know now that this chapter is taught very differently in America.

It seems that maybe teaching the issues of the past more completely may have been a great way to help people to learn to stop repeating them.

The issues of today, seem to be all too familiar from that children’s history book.

Yes I’m looking at you corrupt Supreme Court, and you, paid for politicians, and you business owners who think you have rights greater than other individuals, and you irresponsible gun rights advocates, and you manufacturers who ship jobs oversees to save a buck irrespective of the long term social costs, and you climate change deniers who put your short term profits ahead of long term health and social need, and you union leaders who limit growth of your members to line your personal power bases, and you war profiteers, and you bigots who subvert the meaning of religious texts to support your bigotry…. Hmm it’s a long list when you think about it….


The 7 Habits of Corporate Executives

I’ve read and listened to a good number of books on business, marketing, management, etc. which offer many excellent approaches, techniques and tips to run a successful, innovative, motivated team and organization. These books were/are best-sellers.

7_Habits_of_Highly_Effective_PeopleI know that the senior management of virtually every organization reads them and that many assign them to their teams and the next generation of leaders. “Long-term thinking,” “train, nurture and retain staff,” “always look at things from the perspective of your customers and prospects,” “treat everyone with respect and assume positive intent,” etc.

So my question is, “Why is it so rare that senior management actually follows any of that advice?”

Why do its readers go from "Good to Ghastly?"
Why do its readers go from “Good to Ghastly?”
Are they just not bright enough? Weak minded? Unable to change bad habits? Prefer “politics” to actual achievement as a strategy to advance? I mean really, WTF?

Did they mean well but revert to “Lord of the Flies” behavior after one bad quarter? Or are they just hiding their “crazy” in public most of the time? I’m asking because now that I’m back on positive side of the ledger I’m horrified at how bad it had been so often at so many places for me, my family and my friends. I had a chat with my first real business “mentor” the other night regarding helping his daughter get started in her chosen field and I was reminded how shocking it was when I first worked with him and was truly trusted, supported and empowered by him and the entire management team when we worked together in the 90’s.

We were all “jazzed up” to go to work every day, weren’t afraid to take calculated risks, and achieved great success with a small team and virtually no budget. Motivated, smart people we were and we innovated virtually every day to make the place better. Did I find a great leadership through my own research? LinkedIn? No, it was pure luck for me (and for them), that we “found” each other and were able to do great things and enjoy the process.

Why is that so rare today? Are 70% of Americans just idiots (as one of my best friends continually points out)? Do people really just not listen and comprehend good advice anymore? Are all “organizations” above a certain size just destined to go horribly dysfunctional because of their size? Is even the best corporate culture guaranteed to dissolve above 100 employees?

Soooo many "leaders" need to really read this book.
Soooo many “leaders” need to really read this book.
I don’t know the answer and believe me, I’m not complaining – I love competing against badly managed companies with toxic management styles and dysfunctional cultures. The bigger and better resourced they are, the better; it makes for greater satisfaction when you beat them and have your pick of their customers and their best employees.

I still would like to know the answer but until then I’ll just enjoy the fact that the competition is not going from “Good to Great,” doesn’t live by the “No Asshole Rule” and clearly hasn’t adopted “7 (or even 1), Habit of Highly Effective People.”

p.s.: When asked what my favorite “business” books are, the response is simple: “The Essential Drucker” and “The No Asshole Rule.” Great advice to work and live by everyday-

Best. Business. Book. Ever.
Best. Business. Book. Ever.


What I have learnt from playing Chess.

To win a game of chess you don’t need to have every piece survive, just the king. And in most chess games putting your pieces at risk are the most effective ways of winning. Create an emergency where by taking a desirable piece your opponent weakens their overall defense or by not taking that piece provides you with a desirable offence is the key to playing the game.


The more moves you can think ahead, considering the full range of potential future moves the better your chance of building a winning strategy.

There has always been a strong linkage between games like chess and strategic battle planning or political maneuvering.

In the last few decades these skills have truly entered a new realm of advancement. Since World War II, world leaders have realized the power they get from disasters both natural and forged. Many things that in the cold hard light of reasonableness would seem ridiculous are considered in the wake of an emergency.

The concept of habeas corpus used to be considered absolute! You could not be charged with a crime without evidence and you were considered innocent until proved guiltily in a court of law. These were basic principles of the society we created. It was considered critical that all people were treated as innocent, and this meant that strict controls were placed on agents of the state to prohibit unreasonable search and to ensure that you could not be held without charge.

But every time an emergency happens these and other sacrosanct stakes in the ground of society are ripped to shreds.

When a bunch of mad terrorists attacked America, we lost the right to ensure searches were undertaken only when ordered by a court. We also lost the rights to privacy of emails, and phone calls. And we lost the right to not be held without charge.

When a prick tried to light his shoes on a plane and another tried to blow up his underwear we all lost the rights to not be full body scanned, and to carry nail clippers.

When a hurricane hit New Orleans the people of that city lost their right to public education, and virtually every school was turned into a for-profit school supplemented via vouchers.

This is not just an American creation, everywhere in the world emergency situations have been used to re-write the rulebook, and in every single case the power base has been shifted from the people to an unelected series of corporations.

We now call this globalization.


Today we are seeing more and more “created disasters” such as the so-called fiscal cliff and the previously routine (but now line in the sand) debt ceiling debacles.

Each new disaster allows dramatic changes to be negotiated, lowering the social framework and replacing it with a corporately profitable model.

When we are shocked by the lack of investment by the government after any particular disaster, It’s simply a matter of realizing that in those specific cases the needs of corporations is best served by letting the disaster fester for longer. When there is a benefit to the corporate world, action is swift.

Gun lobbyists and anti-gun lobbyists all see terribly sad gun killings as a reason to push their special interest.

Politicians use minorities and under-educated children as pawns to drive for moving social programs to the private sector.

Fossil fuel advocates who are paid by the fossil fuel industry promote the idea that fossil fuels are good for you, while cigarette companies have only just come around to the idea that maybe ciggies cause cancer.

Now quite frankly I’m not sure that large corporations run by unelected doctor evils are really that much worse than your average politician.

But there is a lot to be said for the idea of getting the politicians you deserve.

Please can we get back to a government “Of the people, for the people and by the people” it really was a revolutionary idea.

corporate overloads


Start It Up In NY?

New York wants new businesses to start up here!   Newly hired employees, innovative new services and products, new revenue and profits and tax income to the state and more!  I’ve heard NY politicians talk about it, “We’re making New York an attractive place to start and grow your company!” and the like.

Steve and Woz in Jobs' garage creating Apple.
Steve and Woz in Jobs’ garage creating Apple.

We’ve heard the stories about successful companies started in a garage or studio apartment with an idea and just a few hundred dollars in some cases. The next thing you know they’ve got a campus, thousands of employees and plans to hire thousands more.  Those stories are never about New York companies though, are they?  Coincidence?  Bad luck?  New Yorkers aren’t as smart as people in Washington state or Virginia or elsewhere?

Actually, just the opposite.  New York entrepreneurs are smart enough to know that New York state and especially the 5 boroughs of New York City have a unique “Publication” requirement for all new LLCs that will likely cost them thousands of dollars and 6+ weeks of hassles.  Open your business elsewhere, no such requirement and no such fee.  Hmmm…, NY and pay the fee or anywhere else and not pay the fee.  Tough choice for them, eh?  How does NY compare to neighboring states for formation of new LLCs per capita?  Terrible, of course.

The “Publication” requirement requires new NY businesses to publish an official notice of their existence in multiple printed newspapers for 6 consecutive weeks.  Any newspapers?  Of course not.  They select the newspapers and you have to call the county clerk to get the names of the papers who will get the $.  They say the requirement is so the general public is “notified” yet the New York Law Journal with its high rates happens to seemingly always be one of the required newspapers.  Big circulation of the general public for that one, eh?  Oh, and the information is already available online, for free, to anyone in the general public who wants it on the Secretary of State’s website.

How unique is the fee?  48 states don’t have it, that how unique it is.   If you’ve ever been curious about what a “special interest” group is and how their influence can drive lawmakers to do something for just them at the expense of virtually everyone else, here’s your case study at the state level.

$2000.00 may or may not seem like a lot of money to you but to some budding entrepreneurs it is money they could clearly use better elsewhere (elsewhere meaning anywhere other than New York).

NY and its lawmakers don't seem to love new business
NY and its lawmakers don’t seem to love new business




Is Apple getting boring?

Is it time to see apple as “that company that used to amaze?.

It was amazing when apple introduced the ipod, the imacs were really cool. I loved it when they introduced the iphone. The ipad was game changing. I even loved the airport extreme, and the apple tv (version 2) changed how I use my TV’s and computers.

But now it’s just a case of twice a year; thinner, faster, bigger, smaller, wider, taller and longer lasting.

Has apple become the new sell-a-vision. Rather than keynotes are they now really delivering 30 minute ad’s prompting how their new feature will change our lives , but hold on order now and get two for the same price , just pay separate shipping and handling.

I still love their products, but it feels like the innovation has slowed down considerably.

Compared to others in the space of ergonomics of consumer IT, they still suck least. But surely that’s not what we have come to expect from Apple.

Information Technology still sucks in so many ways, and there are still huge empty spaces for creativity and game changing innovation.

Apple don’t let the death of your autocratic founding genius be the reason why you stagnate and become part of the homogenous mush that is the rest of tech.

Some of the Android-y companies and even Microsoft seem to be showing signs of getting ready to take the creative high ground. I suspect they will continue to break as much as they fix, so apple you have a chance to stay as the leader of the cool pack. But that chance is getting smaller every day.


The tax discussion is just a way of avoiding real change.

Why do politicians think that all the revenue collected by a small business is taken as Salary?

A small business has many choices available for how to account for the profit generated from their business. It so happens that with the historically low federal income tax rates available currently, the most advantageous model is often to take everything as salary.

But that is not the best way for the economy and jobs. Surely we would be better off as a country if it was more advantageous for a business to re-invest it’s profits into growing the business, hiring new employees and building new things as opposed to taking everything as personal income immediately.

And remember the term “small business” is not just used for what you and I would consider small businesses.

Having said all that depending on where you live, $250,000 of personal income is not rich anymore, and the breakpoint for taxes should be much higher, I’d suggest $500,000 or $1,000,000 would make more sense.

Of course adding more taxes on the salaried income on the richest makes very little financial difference to the total collected by the feds, but it will change how they account for profit on revenue. But all the ways that income can be made outside of salary are worthy of consideration (tax on capital gains, a tax on stock trades, foreign investments, tax on multiple properties etc).

In some countries great schemes exist for alleviating taxes for actions that support the countries economic or social goals. For example in Germany you don’t pay taxes on a mortgage if the property is well maintained and rented at reasonable rates. This encourages investment and helps everyone live in nicer houses.

In other places businesses get a huge tax break for creating products locally. Locally designed, locally sourced raw materials, locally sourced production, but not for local final stage production. This encourages the use of the countries full range of industry and doesn’t reward the old technique of making everything in China and brining it all together for local final assembly just to avoid taxes.

There are a million techniques to use taxation to drive up the economy, and still allow business owners to be just as rich as they are today (or even richer).

In a perfect world the amount of people working would be as high as possible, and all of them earning enough to pay taxes. And the rich would be encouraged by the tax code to grow their businesses in ways that grow the economy.

Personal taxes are just an avoidable inconvenience for the richest, and any change to federal tax rates will have minimal impact on them! Why is it an issue being discussed? Well if we were not discussing this we would be thinking about the deeper issues.

Personal taxes on the rich are just a distraction technique.
A fight that really doesn’t matter, but allows politicians to scream and shout and excite their bases without really changing anything that truly matters.

I dream of a world where politicians all work together for the benefit of the country they serve, and not fight each other for personal gain at the detriment of all the rest of us.


The counter balance

What is worse, a business that pays people so poorly that they cannot afford to live without support from the government or a union that places such restrictive rules on a business that it cannot change to keep healthy?

Obviously this question is a trap. But it is a trap that can and should be avoidable, (and generally is avoided).

When employees of a business feel well treated they tend not to need the power of unionization. And when companies consider themselves the sum of all their employees, investors and customers then the company treats everyone well and doesn’t need to fear that unions will limit their ability to thrive.

When a business finds ways to consider it’s employees in different “classes” there is always the risk that the disparity between the classes will grow in ways that are not reasonable.

Everyone loves to be treated as an individual, and want’s to be rewarded for his or her unique skills. When a cake decorator becomes a master at his/her profession they would like to be rewarded for their excellence. If they get the same pay as someone else who is not as skilled at piping, they have less incentive to hone that skill.

When someone founds a business and spend decades nurturing and growing that business they obviously deserve the rewards that come with that level of dedication.

And when an employee is hired to perform a function for that business they don’t expect to get the riches associated with being the business owner.

There are well documented corruptions of the worker – business relationship, where workers were coerced to either take on highly risky behaviors or were placed in positions of financial subservience where they could not afford to lose their job yet were not paid enough to live. The Spector of these relationships can be seen in many large organizations today.

When unions negotiated benefits as an offset for lower wages, this was a way of a business delaying these payments to their workers. But often the long term costs of these benefits are now causing these very businesses to try and renegotiate. Some of these negotiations see pensions being reduced, while other are through the courts with companies asking for their previous agreements to be swept aside as part of pre-bankruptcy considerations.

I always thought that unions accepting lower pay in exchange for amazing retirement plans was naïve, as there is always the risk that companies can change the rules later.

Companies that treat every employee as a unique individual, providing healthy profit sharing between all levels of employees, investors and customers and not creating barriers between any levels of employees are most likely to not suffer the excesses of union mandates.

But the pressure to reduce costs and increase profits is always going to make this very hard.