Yumiko and I are moving to Austin Texas this month. I’ve accepted a job with a dotcom there. I want to send out all our love and appreciation to everyone we’ve met while here in The Lou. For what it’s worth, I’ll be one closer to the Alamo.

We’ve got some things that we’re not going to take with us. Some bookshelves, a glass computer desk, some books. Please let us know if you’d like them.

and another:

Yahoo, you know I love you...

Yahoo! is in play, again.  Microsoft has been rumored to renew it’s offer, Google may be lurking around, and Alibaba, the China ecommerce marketplace / payment method / sourcing B2B giant, has also been very public about it’s wanting to buy Yahoo!.  In my opinion, Alibaba may offer the best path forward for Yahoo.  My take on the reasons why:

Microsoft – Meh. Microsoft has been desperate to get something to counteract Google’s rise.  As the world moves ever closer to full-cloud operations, the desktop apps become more and more irrelevant.  Yes, people will be using Outlook and MSWord for years to come, but that’s just inertia, it’s not growth.  Bing was a good shot, but it’s still getting 3rd place behind Google and Yahoo for keyword buys from companies.  If MS could acquire Yahoo, they would increase their share of keyword revenue, and might get enough core revenue to start making something.  However, this doesn’t really do anything for Yahoo– it just gets them bought out and assimilated into Redmond.  Meh.

Google – Nope. I doubt the Federales would allow this one: Google already controls possibly 80% of the online advertising revenue out there– if they bought Yahoo, that share could surge up to 90%.  Monopoly (funny how companies are getting to that status faster and faster…).  Here again, Yahoo would just become a brand within Google, and probably quietly left to ebb away into nothing as users were migrated over to GMail, G+, and Google Apps.

Alibaba – Interesting. Yahoo already owns 46% of Alibaba.  There’s a certain I Ching symmetry/irony that could come if Alibaba were to buy out their own “father”.  If Alibaba were to get Yahoo, it would give them a solid beachhead to take all their platforms developed in China to bring to international markets: Tmall, Taobao, Alipay, and Alibaba B2B would gain a US-based staff and org in one fell swoop.  But the important piece that Jerry Yang should consider, IMHO, is how Yahoo! might survive and grow into something sustainable: Yahoo! would likely disappear inside Microsoft or Google, but it stands a good chance of staying on– and perhaps thriving– as a branded portal inside the Alibaba group: as a company, Jack Ma (CEO of Alibaba) tends to segment out new markets, pour money in as needed, and then interconnect companies as much as possible.  Yahoo! enjoys strong portal loyalty with its users.  It’s a decent news aggregator for people, it’s got a kick-ass web mail client (Zimbra).  With all of these, Alibaba could suddenly gain a portal face for it’s considerable marketplace engine in Tmall and Taobao, as well as an ability to link Alipay’s payment services for micropayment content delivery as ipads and tablets push more and more rich content behind paid firewalls.

Forrester wave for ecommerce platforms 2009

GSI announced today that it’s selling out to eBay for $2.4B, which is a lot of money for an also-ran player in the ecommerce space.  But that’s not what drew my attention on this.  It’s the parts that eBay isn’t buying, or maybe that Michael Rubin wanted to keep for himself: shopRunner and ruelala.

ShopRunner is essentially Amazon Prime for the rest of us schmucks that don’t work for The Empire.  It’s a federation of online retailers who offer up yearly subscriptions to customers.  Pay $50 once, and enjoy free overnight shipping for the rest of the year–  A good deal, actually if you buy more than 6 or 7 items a year online.  The subscriptions are transferable across retailers.  If you’re a shoprunner member on shoes.com, then you’re also a member on sportsauthority.com or drugstore.com or borders.com (if they last through the summer).  ShopRunner has a future of becoming a serious consumer powerhouse– it knows what everyone is buying across all those sites, it can bring discounts, and it can introduce new properties to consumers.  It’s all about logistics and customer fulfillment now, and ShopRunner is in a great place.

RueLaLa is a private deal site.  I’m less impressed about this part.  I think the ‘deal of the day’ site is cool and all, but it may have run its course in terms of growth.  The ‘private sale’ model likely has an even shorter half-life: once people realize that the perception of exclusivity is just that, a perception, then the passion will fall off, and RueLaLa will wind up for what it really is: a discount outlet for branded goods.  Sales will be solid, but outlets are never sexy.  There may be an exportable SAAS model there, and I know that RueLaLa has been trying to put that together, but I also know that converting one site into a SAAS platform pretty much requires a complete tear-down and rebuild, or starting from scratch.  At that, RueLaLa is really just a cash-flow to fund something else.  We’ll see on this one.

On the other side of this deal, eBay is moving up the value chain a bit, and picking up some legitimacy in the process.  Let’s be honest, when you hear the word “eBay”, how many of us instantly think “beanie babies” and “random junk flea market”?  eBay has a branding problem, and that’s caused a revenue problem: eBay was never taken seriously as a shopping platform for “real” companies, even though they have a huge amount of traffic and do an enormous amount of sales.  Theoretically this all changes now with the acquisition of GSI: it’s a true B2C ecommerce platform and fulfillment/logistics network.  (GSI always differentiated itself from the other platforms by offering not just the website infrastructure, but the fulfillment warehousing and other logistics goodies).

eBay was always a distant 2nd place behind Amazon.  This doesn’t really change that, but it does indicate a different tack: rather than try to go against Amazon head on in terms of product mix and navigation and pricing, eBay is showing that its’ going for the Taobao model: build up a store from the grass roots small vendors by providing them an ever growing amount of  tools and merchandising functions, then cement in the relationships with an exclusive payment method and legitimate company retailers in the mix.  Taobao, for those of you who’ve never heard/seen of it, pretty much owns the China market to a level that Amazon could only dream of: some estimates put over 70% of ecommerce going through Taobao at one point or another.

eBay is looking to solidify it’s own market space.  Consumer-to-consumer sales? check.  B2C sales? check.  In-house payment method? check.  Fulfillment value chain? check.  The only thing missing now is physical retail space.  I used to think that Amazon would buy Sears or Target.  Now, eBay may get a shot.

eBay made a smart move on this.  Michael Rubin made an even smarter one.

Facebook is rapidly approaching its Sakura-mi in Japan.  Until now it was the dark horse behind the dominant Mixi.jp, and really only used by Japanese students and employees who had spent time in the U.S. or E.U.  But now, with the movie The Social Network hitting it big in Tokyo, and Mixi dying a slow death from no new functionality and a poor user interface, the network effect that accelerates Facebook adoption is taking off.  However, it’s not all sweet rice wine and kara-age.  There are some snags.

Facebook has the following going for it in Japan:

• The movie is pretty much like a 90-minute tutorial on how Facebook works, and that it’s okay (necessary) to use your real ID and not a fake alias.  Japanese are finally getting used to that point.
• Mixi always accepted and centered on people making aliases, which seems like a protection of privacy (a big point for Japanese), but ultimately prevented people from connecting with their real-world set of friends.  Everyone had their real friends, and their Mixi avatar strange connection friends.
• Facebook has its marketing act together: it’s a viable advertising channel which means that companies are looking at it seriously (which they never really did with Mixi).
• Facebook has a workable API for others to utilize (e.g. Facebook login).  Mixi never got that far in their product roadmap.

However, Facebook may run into some bumps:

• When we all signed up for Facebook 3-4 years ago, the Facebook viruses and scams weren’t as advanced as they are now.  I see my Japanese friends signing into Facebook for the first time, but many of them are falling victim to the same scams and dupes that tricked my young nieces when she first joined up.  In short, Japanese users are still a bit naive.
• The “real identity” thing is a big lump for Japanese users to swallow.  If they use their real ID, that means that all those people from High School and old jobs and college can now really find them.  Americans went through that phase, but admit it– if you could do it over again, would you really “friend” all those random people that you happened to graduate at the same time from some school 15 years ago?
• On-gaeshi.  I’ve described this before as a benefit for short texting like twitter, but I still see it as a small hindrance for Japanese.  Friending one person in a group obligates them to friend all people in that group, and anytime they get a friend request, they feel they MUST return the favor.  It almost puts a compulsory feel to the network effect, and it creates a slight anxiety for users.
• Lack of shopping benefits: there’s no deal at Starbucks or Takashimaya or Mitsukoshi for participating in a given Facebook promotion, because those large companies are still way behind on the Social Media thing.
• Work environment: Japanese office workers are pretty much sitting shoulder to shoulder on long bench tables, with the section chief at the end of each row, and the bucho sitting behind him (furthest from the front door, of course).  There are no cubicles, no offices, no privacy.  There’s no way office workers can screw off on Facebook during work time.

I’m sure Facebook will eventually roll through the country.  I am also relatively confident in predicting that penetration will never be as high as it is here in the US.

• For the sake of keeping the math easily understood, let’s say there are 350,000,000 people in the United States
• Let’s also put the Federal Budget at $3.5 Trillion (for easy math)
• Divide the budget by the population and we get $10,000 each.  It costs each person (you, your spouse, and each of your children) $10,000 each year to power the federal government.  Ouch, but okay.

So, there’s the situation.  Here’s my proposal:

• Give every person in that 350M population a vote, including the children (because we need to let the future people vote more than the dinosaurs on this stuff).  For children’s vote (anyone under 18), the vote goes to the parent as a proxy vote.  Mormons and Catholics will love this part.  That’s 350M possible votes.  These votes are handed out 1 vote per person for free. Kinda like how things are now, with the additional kids’ votes.
• Issue ANOTHER 350M votes, but not to the people.  These 350M votes are FOR SALE, at $10,000 each.  I don’t care who buys them: Google, the Teamsters, my rich uncle, Boeing, Jimmy Swaggart.  Votes go for $10K each.  Get ‘em while they’re hot.
• Abolish the income tax, because the feds don’t need it anymore (they’re selling things now, no more compulsory crap).

Insane, right?  Maybe, but think about it.  I still get a vote.  At most, only 50% of the electorate is for sale, so sovereignty still lies with the people.  If I want to participate more than my one vote, I am welcome to buy another (which I might, I just got a windfall bonus because I’m not paying income tax anymore).  Large corporations will want to buy hundreds of votes, and they’ll open their checkbooks.  In the new system, that money goes into the general fund, not some fat senator’s pocket.  Speaking of whom, those senators and congressmen will suddenly need to switch roles: from gladhanders who dole out money that they didn’t make as favors to sycophants, into becoming salesmen huckstering for votes.  Aha– how has the power now, Quimby?

Won’t corporations buy up all the votes?  Yes, I hope so– tell me how that’s different from the current situation.  Won’t rich people monopolize their power over the poor?  Maybe, but again– how is it different from now?  If anything, this would make things way more transparent.  If you don’t buy an additional vote, then use your one free vote wisely.  If  you don’t like the government policies, then either pony up and buy a vote, or shut up and sit down– it’s free for you.

I kicked this idea to Scott Adams, and he said it was a good idea, but likely a tough sell.  Help me spread the word.

Look! What exotic writing!

Can someone please tell me why we still have passport books with 20-odd pages in them? There’s really only one page that “counts”, the one with your photo and passport number on it. The rest of the pages are blank, left to be filled up with stamps from various countries. I used to be quite proud of my last passport book, as it had stamps from all over Europe and most of East Asia. In fact, I actually filled the book.

I am confident in guessing that the concept of a passport book arose out of 19th century British Empire or French Departmental bureaucracy. Before passport books, men carried “letters of writ” with embossed blobs of wax stamped with seals on them. This format doesn’t stand up well, so a specific book was a great leap forward. But given that entry into any given country is now done by electronic lookup, a modern passport really only requires the one page with my photo and the embedded RFID chip. When Japan lets me enter as a spouse of a Japanese National, they know exactly who I am and who my wife is. Why do I need a stamp that says so? When China granted me a multi-year multi-entry visa, they gave me a nice shiny sticker that takes up a whole page, but I am pretty sure this is for my benefit– certainly the records of my visa are in their immigration computers, right? This would be true for any country that grants specific visas for entry: they really only need my name ans unique passport number to look up my records. If anything, the sticker is there just to make me feel good and see something tangible in my little book of stamps and stickers.

There are two options I can think of to keep the passport book-and-stamp format:

1. It’s there for people without a computerized lookup method handy
2. It’s a graphic cypher, with those immigration officials stamping my little book at odd angles that only they can read properly (if I tried to stamp my own book, I would get the angle wrong, and I would get busted)

Neither of these theories hold water, however:

1. Anyone who doesn’t have computerized access to immigration records and permissions has no right looking at my passport. Am I the only one that gets bothered when hotel clerks ask for my passport and write down my information? Who the hell are they?
2. Any sort of graphic cypher would need a key, with some way to transmit that key from the writer (stamper) to the reader (the next immigration official reading that stamp some months later). No way. It’s a hand stamp, and a poorly-inked one at that.

I’m pretty sure the passport book is a hold-over to a more romantic era of travel, much like those stickers that our parents put on their luggage, and we used to collect kitchen magnets. I would bet (hope) that pretty soon it will all be in the the cloud, and we’ll merely collect Foursquare badges.

good luck with that.

Oh, that I could be in Washington DC at the end of the month, to attend the Rally to Restore Sanity sponsored by Jon Stewart.  When Jon was pitching for his satirical rally, he stated as one of the deliverables for the conference was for “… everyone to take it down a notch.”  I’ve already seen this phrase on Boing Boing twice since then, as well as a few other places.  I predict it will be the new meme for Fall, and is certainly welcome and several years overdue.

Social media is fun and interactive and certainly eats up more than its fair share of our precious time (which should be devoted to sitcoms and game shows), but it comes with a sour side effect: all these online threads and discussions reward the polemic, the sarcastic, the zealot, and the crank.  No one gets very far in a discussion thread with something like “well, I don’t agree with you, but I can see where you’re coming from, so I guess that’s okay.”  It doesn’t matter if we’re discussing politics, restaurants, athletes, or Star Trek episodes (it’s a foregone conclusion that “City on the Edge of Forever” is the greatest episode of all time).  Any discussion thread is pretty much dead in the water until someone throws a rock, either decrying some action or wildly praising it, which causes some factionalization.

When someone throws a rock in a discussion thread, participants have four possible fates:

1. Some people in the group will oppose the first position with equally violent counter-rhetoric.
2. Some people will oppose the opposers.  We now have our two camps of douche-bags and assholes.
3. A third group will take the sarcastic meta-position of critiquing both groups (which I am doing here to some degree).
4. A fourth group will try and come up with some rational explanation or middle ground.  Good luck with that.

None of this is new information.  We’ve had Godwin’s law for over 20 years now.  What has changed is that: a) there are a lot more people in these threads now, and are just waking up to these dynamics (your mom knows about Godwin now).  All of these non-geeks used to yell and scream in sports bars over cigarettes, but they’re on your facebooks now, and they’re going through the cycle; and b) Jon Stewart and Stephen Colbert are trying their damndest to give that fourth group some juice.

I, for one, welcome this new meme.  I’m going to make it a point to use it online at least three times this week.

Just remember, No matter where you go, there you are.

Multichannel, multichannel, multichannel.  For online businesses, it is simultaneously the New Promised Land as well as The Impending Doom.  I’ve discussed before how I think Amazon will ultimately see its greatest threat come from Walmart, and may actually acquire Target or Sears in order to pre-empt the risk of a competitor that can offer online deals as well as physical storefronts.  The same could be said for Best Buy over NewEgg.com, REI over backcountry.com, or even Dave & Busters over Gamestop.com.

Along the same lines, I think Facebook’s recent addition of ‘facebook places‘ isn’t merely trying to push out fourquare or gowalla for eyeball share– quite the opposite– they seem to be warmly welcoming  those partners into the fold.  All Facebook wants is everyone’s current GPS coordinates, regardless of who tricks the user into surrendering them.  Why?  Because once Facebook has your 10-20, it can turn around and drop a dime on you to all those potential location-sensitive advertisers.  Facebook has the opportunity to beat Google at it’s own game.  Think Multichannel.  Think Mobile.  Think Minority Report, much sooner and much worse than anticipated.

Google must realize this also, hence its mad rush to buy up some social network providers along with location-triggered services.  I fear it may be too late for Mountain View, however– everyone has their personal troupe/network built out on Facebook, and they’ll be loathe to do it again somewhere else.

The other risk here is that the proletariat may rise up in rebellion against constantly announcing their whereabouts, but if there are free lattes involved, I wouldn’t be surprised to see people surrender their bank card PINs.

Times was, I used to be able to spout off any random factiod I thought I knew, and the Internet took it as read truth.  The Wikipedia used to be great for this.  Now, my rants are pretty much limited to the blarg you’re reading right now– we’re probably all better off for it.  Most university professors scowl very deeply if a student references the Wikipedia in a footnote, which is fair, but not for the reasons most people think: Wikipedia is a bad reference source because it’s a derivative work, not because it may be inaccurate:  The student should be citing the original work, not someone’s summarized boilerplate.  Wikipedia has largely squashed the ‘inaccurate’ label through a zealous use and requirement of all statements must have footnotes.

But that raises a conundrum for many of us: where is truth?  Where is the expert?  Is the expert the one with the most experience?  Is the expert the one with the most money?  The most devotees?  Is truth simply the mob’s consensus?  Graduate school told me that truth is the logical sum of a tested thesis.  I spent 15 years being smug that I knew what that meant, only now to really see that when the Internet gave everyone a soapbox from which to preach, now social networks are giving everyone a Hyde’s Park corner complete with audiences.  Companies like bazaarvoice and pluck are setting up these cacophonies wherever possible (good for them).  These systems invariably include meta-rating systems to rate the reviews and the reviewers, in the hopes of crowdsourcing the good information from the bad.  In general, it usually works.  It is still, however, all based on a Kuhn-model of mob truth.

The NYT recently published an article on a new computer named “Watson” designed by IBM to play Jeopardy.  Another possible use they summized might be to find counter-factual statements to anyone’s gtiven declaration on the Internet.  In short: a bullshit detector.  I can imagine they will be able to monetize this thing into millions of dollars: every social network and review thread can now come with a robot that can read plain speech, offer immediate counter-responses to erroneous information, and perhaps even show us a numerical score for ‘trustability’ or ‘truthiness‘ (all the footnotes in that link– irony!). The downside here, of course, is that most reviews for most products will be reduced to little more than the barren subjectivism of American Bandstand: “It’s got a good beat, I can dance to it.”

There is still salvation for quality content in quality reviews: hard numerical data, solid logic, and qualitative feature polarization.  I’ll explain myself on those in some upcoming posts.

This thing is metal, the size of a credit card, and uses contactless RFID to talk with whatever cash register is nearby.  Japan Rail started using Suica on the train wickets 10 years ago (traditionally, the choke point of inefficiency in any station) in order to speed people through before they get packed in like sardines (you’ve seen the pics before, and yes– it’s true).  From there, it soon spread to the convenience kiosks on the platform, the convenience stores next door, and now looks pretty ubiquitous anywhere within a kilometer of the station (which means everywhere except your grandma’s house).

Visa and Mastercard never got very far in Japan (compared to marketshare in the US).  JCP (a Japan-specific credit card) had a good run, but looks to be shrinking to second-class status like Discover Card.  Cash was always king: I used to walk around with the equivalent of $500 in my back pocket; most Japanese had $1000 on them at any given time.  Big cash + crowded trains = pickpocket’s dreamland.  I couldn’t ever figure out why crime was so low.

But enter the Suica– it’s got both Cash and Credit Cards beat:

• can be loaded up with credit via monthly automatic deposit, cash in an ATM, or even cash-back from some POS
• personally stamped with your daily commute route
• same size as a credit card
• no numbers or identity to be stolen
• MUCH MUCH faster than a credit card transaction

That last point is the killer.  To buy anything, all we had to do was tap this thing inside a circle on the glass counter, as if we were beknighting the transaction,  done.  Meanwhile, a credit card requires a swipe, a printout, the hostess signing the receipt, and we (the buyer) countersigning.  I know that some US places are just accepting the one swipe under a given amount (no signing required under $25 or so), but it’s still slower.

My prediction: Suica or other RFID cards are coming to the US soon (some are already here).  They’ll take a good chunk away from Visa corporation, especially in mass-transit towns like Boston, NYC, DC, and/or San Francisco.  My money is on Boston or San Francisco, especially if they can figure out a way to build community-centric bullshit around the card.

If I were Yelp, I would be teaming up with JR on bringing a branded card to SFO right away.