For our class session today, where the topic is innovation and business models.

http://www.youtube.com/harvardbusiness#p/u/32/KGzXWO_anLI

Google and Cisco

Google announced a couple of weeks ago that they intended to experiment and deploy a 1GB network in the US for connecting up to 500k households. See the Google blog site for details.

So who is scared? One industry pundit writes:

Regardless, the carriers are scared. Just like they were scared when Google said that it would start investing in wireless broadband by participating in wireless spectrum auctions. Earlier today we held our most recent Bunker Series Event where we discussed the broadband buildout ( GigaOM Pro, sub req’d), and I was pretty explicit in making the point that Google Fiber is a good thing, because incumbent carriers have been dragging their feet for too long.

And who is the Winner in this? The FT writes:

Cisco Systems is developing an ultra-high-speed system for internet access in partnership with a number of US service providers, according to people close to the company.

The move by the US telecommunications equipment maker comes just weeks after Google promised it would build an ultra-high-speed fibre-optic system . The Federal Communications Commission, the US media regulator, is preparing to unveil its national broadband strategy next month. Unlike Google, Cisco’s move does not appear to conflict with existing broadband network operators.

Walmart and Online Video

Reuters reports that Walmart, the world's largest retailer, has purchased a video online site. they report:

"Wal-Mart Stores Inc will buy the fledgling Vudu online movie on-demand service, in a deal expected to close within weeks and pit the world's largest retailer against the likes of Netflix Inc.

Wal-Mart hopes to combine Vudu's technology with its own scale and expertise to get into a burgeoning market staked out by Netflix and other digital movie distributors, as viewers migrate to the Internet away from traditional movie rentals."

So what do you think they are thinking in Bentonville? How does online video sales mesh with the physical retail world?

Thinking Big

A video on the Bloom Box-one of Silicon Valley's most secretive, but expensive start-ups is here. Can it be true?

Carly Fiorina

As a bookend of the prior post about the new CEO of Xerox (and if you thought it was worthwhile reading), you may want to read the commencement speech of Carly Fiorina, former CEO of HP, given in 2005, just after her highly publicized dismissal. Go to this link.

This is a lesson about attitude. Ursula Burns recently became CEO of Xerox Corp., a former blue chip company that due to technological change, had become a turn-around story. They are in the middle of the story today--outcome not clear yet. She is unique in that she is the first black woman to become CEO of a Fortune 500 company in the US. So what does it take to stand up and walk to the top of the hill? What set her apart for this highly coveted position? The NY Times did a recent article on her in their Sunday business edition. Some key points are in bold:

In 1989, she was invited to a work-life discussion. Diversity initiatives came up, and somebody asked whether such initiatives lowered hiring standards. Wayland Hicks, a senior Xerox executive running the meeting, patiently explained that that was not true.

“I was stunned,” Ms. Burns recalls. “I actually told him, ‘I was surprised that you gave this assertion any credence.’ “ After the meeting, she revisited the issue with Mr. Hicks, and a few weeks later he asked her to meet with him in his office. She figured that she was about to be reprimanded or fired.

Instead, Mr. Hicks told her she had been right to be concerned but also wrong for handling it so forcefully. Then he told her he wanted to meet regularly with her.

“She was enormously curious,” Mr. Hicks remembers. “She wanted to know why we were doing some things at the time, and she was always prepared in a way that I thought was very refreshing.”

He offered her a job as his executive assistant. It was January 1990, she was 31, and the offer felt like a dead-end. “Why would I ever want to do that?” she answered, assuming that the title meant secretary. The job was much more, of course. She would travel with Mr. Hicks, sit in on important meetings, help get things done.

She accepted, and, Mr. Hicks remembers, they talked a lot about leadership. Mr. Hicks, a vice president overseeing marketing and customer operations, explained the need to manage people in different ways, not to intimidate them, and to make them feel comfortable by listening carefully.

As she absorbed some of these lessons, Ms. Burns continued to speak her mind inside Xerox — particularly on an occasion in mid-1991 when the stakes were unusually high. At the time, Paul A. Allaire, Xerox’s president, held monthly meetings with top managers, and Ms. Burns and other assistants were invited to sit in (but off to the side).

Ms. Burns noticed a pattern. Mr. Allaire would announce, “We have to stop hiring.” But then the company would hire 1,000 people. The next month, same thing. So she raised her hand.

“I’m a little confused, Mr. Allaire,” she said. “If you keep saying, ‘No hiring,’ and we hire 1,000 people every month, who can say ‘No hiring’ and make it actually happen?”

She remembers that he stared at her with a “Why did you ask that question?” look and then the meeting moved on.

Later, the phone rang. Mr. Allaire wanted to see her in his office. She figured that it was not good news. But Mr. Allaire wanted to poach her from Mr. Hicks, so she could be his executive assistant.

So where did this attitude come from? She answers:

“150 percent my mother. My mother was pragmatic, focused and extremely, exceedingly practical, and she was the ultimate self-determining person.”

Her family (her father was never in her life) lived on the Lower East Side of Manhattan — “when it was really bad, when the gangs were there and the drug addicts were there.”

Her mother made ends meet by looking after other children. She also ironed shirts for a doctor who lived down the street and cleaned his office, bartering for things like medicine and even cleaning supplies. She had many sayings — and she repeated them, often in blunt terms, over and over.

“Where you are is not who you are,” she would tell Ms. Burns and her brother and sister. “Don’t act like you’re from the gutter because you live in a place that’s really close to the gutter.”

“She was very, very black-and-white and very clear about what responsibilities we had,” Ms. Burns recalls. “One was that we had to be good people. And the second thing is that we had to be successful. And so her words for success were, ‘You have to give’ — and she would say this all the time — ‘more than you take away from the world.’ ”

Google and Power

Google has received the right to sell power to consumers and companies from the Federal Energy Regulatory Commission. What could they be thinking?

Wired explains:

Google can now exploit its massive data centers to provide services for controlling power consumption in commercial buildings, industrial sites, and homes. It is largely a task that should be handed off to large computer rooms.

Providing these services will allow Google to better leverage its hardware resources. Search will get cheaper because the hardware budget can be amortized over more services. Both web 2.0 companies and energy-services companies will complain about being undercut by the big G. Consumers will also have to get used to Google having even more information about their daily habits.

But can Google charge for energy-management services? That could be a challenge. The average person might rightly balk at suddenly being asked to write a monthly check to one of the biggest companies in the world, particularly if other companies offer the same services.

This is where the power part comes in. Consumers will pay for power. If Google combines its services — for free — with competitively priced electricity, consumers will likely lose that reticence. It will be a better combination than what their utility can provide.

Conversely, Google could charge for these services the same way energy services companies like Siemens do: If Google saves you $200 on your utility bill, you pay the company half. You pay, but you still save. It’s a theory, but clearly the company and its founders are obsessed with alternative energy.

Read More http://www.wired.com/epicenter/2010/02/google-can-sell-power-like-a-utility/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+wired%2Findex+%28Wired%3A+Index+3+%28Top+Stories+2%29%29&utm_content=Google+Reader#ixzz0g1qLNfq5

ChatRoulette

Some have called Chatroulette the hottest site since You Tube. The New York Magazine describes the experience as follows:

"The first time I entered ChatRoulette—a new website that brings you face-to-face, via webcam, with an endless stream of random strangers all over the world—I was primed for a full-on Walt Whitman experience: an ecstatic surrender to the miraculous variety and abundance of humankind. The site was only a few months old, but its population was beginning to explode in a way that suggested serious viral potential: 300 users in December had grown to 10,000 by the beginning of February. Although big media outlets had yet to cover it, smallish blogs were full of huzzahs. The blog Asylum called ChatRoulette its favorite site since YouTube; another, The Frisky, called it “the Holy Grail of all Internet fun.” Everyone seemed to agree that it was intensely addictive—one of those gloriously simple ideas that manages to harness the crazy power of the Internet in a potentially revolutionary way.

The site activates your webcam automatically; when you click “start” you’re suddenly staring at another human on your screen and they’re staring back at you, at which point you can either choose to chat (via text or voice) or just click “next,” instantly calling up someone else. The result is surreal on many levels. Early ChatRoulette users traded anecdotes on comment boards with the eerie intensity of shipwreck survivors, both excited and freaked out by what they’d seen. There was a man who wore a deer head and opened every conversation with “What up DOE!?” A guy from Sweden was reportedly speed-drawing strangers’ portraits. Someone with a guitar was improvising songs for anyone who’d give him a topic. One man popped up on people’s screens in the act of fornicating with a head of lettuce. Others dressed like ninjas, tried to persuade women to expose themselves, and played spontaneous transcontinental games of Connect Four."

Avant Garde? yes. I haven't tried it- no webcam but soon to get one. Anyway, the NY Mag writer says that it is brutal--he got switched off abruptly by the other side 18 straight times--"too old" was the usual response, where there was one--and he is 32.

So who would create this kind of site? A 17 year old from Moscow. He described his experience as follows (quoted in email to the NY Times):

I created this project for fun. Initially, I had no business goals with it. I created this project recently. I was and still am a teenager myself, that is why I had a certain feeling of what other teenagers would want to see on the Internet. I myself enjoyed talking to friends with Skype using a microphone and webcam. But we got tired of talking to each other eventually. So I decided to create a little site for me and my friends where we could connect randomly with other people.

It wasn’t so easy to create it for me, but I have been coding since 11 (thanks to my father who introduced me to the Internet early – most of my knowledge comes from it).

I didn’t advertise my site or post it anywhere, but somehow, people started to talk to each other about the site. And the word started to spread. That’s how the simultaneous user count grew from 10 to 50, then from 50 to 100 and so on. Each time the user count grew, I had to rewrite my code completely, because my software and hardware couldn’t handle it all. I never thought that handling the heavy user load would be the most difficult part of my project.

As the user base grew, bandwidth and hosting bills started to show bigger sums. I am glad that my relatives helped me with it by ‘investing’ some money in my idea.

It wasn’t very much money, so I couldn’t just buy new servers just like that, I had to optimize my code as much as possible instead. I must say that lots of people have helped and still are helping me when I have questions about coding. I am very thankful to them. I still code everything myself, though. I’d love to share work with someone else, but I am not in the USA, and most of the interested people are located far away from me, because I live in Moscow. So I still have to do all the things myself. But I am not worried.

I enjoy what I do. It is like a game for me. I discover new things and solve interesting problems.

Right now Chatroulette uses seven high-end servers all located in Frankfurt, Germany. Network throughput is 7 gigabits a second. I use various technologies to minimize bandwidth consumption. But a lot of bandwidth is still consumed. Bandwidth bills show sums which shock me as a teenager, but I am not very worried.

I am glad that people show attention to my project, and there were interesting offers I’ve received that probably might help my project to survive and improve.

Advertising on Chatroulette is kept to a minimum, because there are a lot of sites full of advertisements, which distract you from what you want to do on those sites. I also love minimalism. That’s why I have put only four links on the bottom as advertisements. And what is interesting, is that these advertisements almost cover all expenses, just those four links on the bottom!

I think it’s wonderful that I do not have to put a lot of advertisements on my site to keep it running. I am not sure why it is so. Maybe because Google AdSense (the thing I use to show the advertisements) shows links to various video chats. I don’t think this is a bad thing. I actually think it is a good thing, because only people not interested or tired of using my site click those links, to explore other services.

I am aware that Chatroulette is popular in USA. It is interesting, but I have never been to the USA myself. Yet most of my site users come from it. I would love to visit the United States.

I actually think that it would be best to found Chatroulette as a U.S.-based company. But this is just an idea.

I have always wanted Chatroulette to be an international thing. That’s why I chose Germany for hosting, because it is in the middle between Russia and U.S.A. It is also at the center of various backbone European networks. I think this is a good place for hosting a project which connects people around the world with each other.

However, I am planning to get other servers in other countries soon. With it I will add more interesting and “weird” (in a good sense) features which will make my site even more entertaining.

What is currently stopping me from adding other features which have been suggested by many and have been in my mind is that I am not even sure what Chatroulette is now.

Everyone finds his own way of using the site. Some think it is a game, others think it is a whole unknown world, others think it is a dating service.

I think it’s cool that such a simple concept can be useful for so many people. Although some people are using the site in not very nice ways – I am really against it. Others do really unbelievable things I could never think of. They make up songs about strangers and sing to them, draw them, listen to music, broadcast them their own music. Two groups of teenagers can party together. That’s just great in my opinion. I am glad that I made this project and it is a pleasure for me to work on it.

Financial Capitalism and IBM

For the past few years I have begun to question the merits of finance led business--that is to say, where the "bottom line" determines capital allocation and business strategy--management by the spreadsheet if you will. It is an uphill battle as financially-led business is so "logical" in theory--just like free markets. In practice, it leads to something else--inequality, disruption of people's personal lives, and perhaps long term decline due pushing the company to capital rates that are not sustainable over the long run. I don't (yet) know what the solution is and there are a lot of thoughts flowing among people far smarter. Regardless, for a glimpse of how financial capitalism is affecting IBM, see this article from Robert Cringely, one of my favorite IT analysts. Let's see if his prediction of customer revolt in 2010 holds true, though we won't see the financial results until 2011.

Empathy

An excellent article is posted in the FedEx Open Forum. As they quote Henry Ford:

“If there is any one secret of success,” said Henry Ford, “it lies in the ability to get the other person’s point of view and see things from his angle as well as your own.” This is empathy.

And how do you practice empathy--six tips are given in the article including my favorite for the business world:

Much has been written about what executive presence is but one thing is certain: those who possess it have “social generosity.” We invariably walk away from them feeling energized and better about ourselves. This is because they have empathy, the quality that makes them sense our need to feel important. They see us not as we are, but as who we could become. Simply put, they care about how we feel. What a wonderful gift it is, to be able to bestow this on those we encounter. One could argue that it is indeed impossible to have executive presence without empathy because a major requirement for executive presence is the ability to connect with others.

We pay people lots of money for identifying hidden assets and we talk of this as the means of achieving success in the financial world; and yet the far more "value add" talent is in the above--to see not as we are but as who we can be.

Education

Have been thinking about education for some time--kids do that to you. And there is undoubtedly a heat wave on education, which will only grow more intense with the global melting pot--opportunities for any who can think. And when I listen to my Indian friends, they are right there with Koreans in terms of focus. But what should be taught remains stuck in the old ways.

In the NY Times, Susan Engel had this to say:

"...what children need to do in elementary school is not to cram for high school or college, but to develop ways of thinking and behaving that will lead to valuable knowledge and skills later on. So what should children be able to do by age 12, or the time they leave elementary school? They should be able to read a chapter book, write a story and a compelling essay; know how to add, subtract, divide and multiply numbers; detect patterns in complex phenomena; use evidence to support an opinion; be part of a group of people who are not their family; and engage in an exchange of ideas in conversation. If all elementary school students mastered these abilities, they would be prepared to learn almost anything in high school and college."

So how do we get to this educational state of enlightenment? Engel further writes:

"In this classroom, children would spend two hours each day hearing stories read aloud, reading aloud themselves, telling stories to one another and reading on their own. After all, the first step to literacy is simply being immersed, through conversation and storytelling, in a reading environment; the second is to read a lot and often. A school day where every child is given ample opportunities to read and discuss books would give teachers more time to help those students who need more instruction in order to become good readers.

Children would also spend an hour a day writing things that have actual meaning to them — stories, newspaper articles, captions for cartoons, letters to one another. People write best when they use writing to think and to communicate, rather than to get a good grade.

In our theoretical classroom, children would also spend a short period of time each day practicing computation — adding, subtracting, multiplying and dividing. Once children are proficient in those basics they would be free to turn to other activities that are equally essential for math and science: devising original experiments, observing the natural world and counting things, whether they be words, events or people. These are all activities children naturally love, if given a chance to do them in a genuine way.

What they shouldn’t do is spend tedious hours learning isolated mathematical formulas or memorizing sheets of science facts that are unlikely to matter much in the long run. Scientists know that children learn best by putting experiences together in new ways. They construct knowledge; they don’t swallow it."

Impossible? I have seen schools doing this--this is the competition for the future.

Bill Gates and More....

Found out that Bill Gates has his own blog site now--he gives his views on issues of the day, tells people what he is doing, what he is reading, where he is traveling. For details go here: http://www.thegatesnotes.com/

From this site, Bill suggested that if I was interested in sustainable energy that I read three huge thick books on Energy written by this obscure (at least to me) professor--the fellow has a voracious reading appetite---and it is not the only book that he is reading now. Anyway, he said that if I did not have time, that I should check out this video--what an interesting man he introduced to me. A professor of University of Manitoba -- independent, worldly, data-driven thinker. It is worth listening to if you are interested to know the direction of the planet.