Price is what you compete on when you’ve nothing else left — no convenience, premium features, feelings associated with a brand, usability, lower total cost of ownership.
In a crowded market competing on more than just price, fierce competition can therefore be highly virtuous. Competitors can be genuine good guys. (more…)
In my view, Windows Vista is immoral. It requires so much computing power and space that most people (and certainly most businesses) will have to upgrade their stock of Microsoft PCs. What happens to the old stuff?
they reflect the times, yes?
Yes, that’s 700 million. Not bad for 6 years’ work – well done, Sam Morgan.
Watch for expansion.
But today we made our first employee.
Matt sent me a couple of links this morning which may be worth your while:
On Taming the To-Do list (and the clutter of your mind)
On Besting the Paper Beast (and the clutter on your desk)
By coincidence, I evolved/discovered the first system about a month ago, and it’s made an incredible difference to my organisational skills and productivity.
Growing our company is a daily nitty-gritty struggle. Often, when buried in that struggle, it seems to me that progress is non-existent, or at best, painfully slow. I am constantly frustrated by own limits, both of aptitude and in character. And if a lack of skill, insight, or diligence makes me feel like a fraud, lack of demonstrable progress seems constantly to confirm it. I keep waiting for people to say, when are you going to give up this charade?
With this background, it is a kind of stubborn, dogmatic arrogance, a kind of sheer bloody-mindedness that makes me get up in the morning and go to work. Sometimes, in doing this, I am cringing inside, but another part of me is raising its middle finger: it says to me, screw you, you insecure self-doubter, and up yours, world: I’m going to do this.
This morning, I sustained a lucid explanation and exploration of the shape, state, and value of our company, for 2.5 hours. I was meeting with a potential mentor, dealing with strategic overview stuff. And he was impressed – he wants to work with us.
I could never have done that 18 months ago, when we entered Creative HQ. Never never never. It is so good to have this unexpected demonstration of how much progress I have actually made. And it feels very good to realise it.
So put that middle finger down, son.
Bernard Hickey, in the business section of the Dominion Post, says
We are mortgaging the nation’s future by borrowing money overseas to push up the prices of each other’s houses.
There are a number of big issues in Bernard’s small sentance. Firstly, the problem of debt. We are borrowing money overseas because the banks we borrow from cannot find enough surplus within New Zealand. In other words, our kitty is bare, but we’re still spending. So, someone is gleefully plugging the gap – giving us all the credit we want. That’s going to need repaying, sooner or later.
Secondly, the problem of debt being used non-productively: not a scrap is added to the economy by bidding up the price of land. Thirdly, the problem of debt being used to add fake value. The true value of land is its value in use (the productive return from the land), and this does not change, no matter how high the price paid for it. Fourthly, the problem that our own people, not least our children, are the ones penalised by these high prices: they cannot access that most basic of resources. We, and they, are forced to pay a massive premium in the purchase price, a premium built on speculation of buyers everywhere that someone else will pay even more for their land – either in rents or in a subsequent sale.
This is exactly what occurred with the share prices of technology companies during the dotcom boom of the late 90s. Led by their noses by unscrupulous venture capitalists, people kept stupidly buying the shares of Really Bad Companies, Inc – simply on the basis that some other mug would pay even more.
But the reality is that the long-term price of an asset must tend toward its utilisation value – its value from productive use. This is because only that value will be consistently returned to the owner – and therefore, it is the only long-term basis for justifying the purchase cost of the asset.1
Now, in the dotcom boom of the late 90s, people were buying shares in companies whose long-term return was less than zero. The return was less than zero because the typical over-hyped Really Bad Company produced ’stuff’ at a cost greater than anyone would pay on the market. It was simple: their cost of production exceeded price of sale, and they were losing money. But so long as people and institutions kept ensuring a supply of credit by purchasing shares,2 the company kept going, throwing the money away but keeping their doors open.
When enough people realised that the internet, though seemingly a magical technology, could not magically help bad businesses make good money, and began to suspect that the money for speculation was running out, they began to get nervous. Very quickly, people lost confidence that the next mug would buy at a higher price than they themselves paid. So they sold out, as quickly as possible. Credit to these companies stopped. Virtually overnight. And the crash ensued, wiping out billions of dollars’ worth of speculative premium on shares: premium that someone had to pay for. Therefore, it wasn’t just ‘value’ that got wiped out, but many thousands of peoples’ financial well-being.
Now, consider our housing market. Although the utilisation value of land is greater than zero, the prices being paid for it are much greater still. There is a massive speculative premium built in, based simply on the fact that the next mug will pay more than the last purchaser.
What’s the lesson – not only of economic common sense, but of history? There is going to be a significant, as they say, ‘re-adjustment’.
And all those billions that have been borrowed overseas, and used to create that speculative premium, will need to be repaid. With interest. Someone is going to be left holding the can.
Christians, I hope, will not be among those holding the can, because Christians, I hope, will have been taught not to buy into a system that rewards (for a time) unproductive speculation for the sake of greed – and greed which, in the meantime, only robs our own people of purchasing power. The very antithesis of the Old Testament Jubilee, and the more generalised law, “Love thy neighbour”.
I hope.
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Published my company’s website.
Improvements to follow.
Matt’s got this link, about the emergence of non-ontological digital classification schemes, on his blog. He said to me that it sounded very germane to the original thrust of my company (which is sirlochlin R&D Ltd), and he’s exactly right.
We have been trying to build software to implement exactly these ideas since late 1999. And, now we’ve got some really good (but untested) technology. So it’s great to be vindicated by something as compelling as Shirky’s analysis.
But it’s very frustrating to not have the resources to complete the task – to develop both the software and opportunities we need in order to stay ahead of the game and produce something ground-breakingly cool – before everyone else catches up and sweeps on by.
Watching a fellow resident’s business fall apart and fail is very sad. The personal agony and self-blame is enormous. Not nice. Not nice at all.
In the interests of bashing bad business examples fairly, and because I really do like the way Daniel carries off dialogues, read this.
Some time ago I had a moan about the Evil Empire’s lying spokesmen, spinning, spinning, spinning.
Here’s a classic example, reported by CNET. It’s in a story about how the EE is going to make people in China, Norway and the Czech Republic verify that they have legit copies of Windows before they can apply security updates:
“We think that the best foundation for the most secure system is genuine software,” said David Lazar, director of the Genuine Windows program at Microsoft. “We want to urge all of our customers to use genuine software. (At the same time), we want to make sure that we don’t do anything to reduce the likelihood that a user will keep their system up to date.”
What a load of bollix. They want to make sure people are paying them money for their software. And there’s nothing wrong with saying this straight out. So why don’t they simply tell the truth? “We want people to stop ripping off Windows!”
Their actual response avoids this plain speaking, and moreover contains an implied lie, since paying for EE software has nothing to do with its security. A pirated version of Windows is no less secure than the original: unlesss, of course, the EE prevent you from fixing its flaws. Which they will do, if you live in China, Norway or the Czech Republic.
Therefore, with this sort of slimy, underhand response, all the EE does is contribute to the erosion of trust in the company – and, moreover, set a bad example in terms of corporate integrity.
So why the horrible spin?!?
I do apologise for a lack of substantial postings. Strangely, I have been focused mainly on working. But I have a heap of things that I’d like to explore, some of which are half-said and languishing in drafts. There’s this little voice in my head, or a particular arrangement of my guts, that tells me when something feels right to say, and is being said in the right way. I’ve learned to listen (though doubtless not well enough) – and that’s why some of those posts are still drafts.
There’s also a heap of good things written by others to which I would like to draw your attention, and which are piling up. But I need time to do them justice – to read, mull, and then work out what I want to say, if anything. Linking implies thought, and I don’t want to lie about how much I’ve thought!
But in the meantime, I spent time at the laywer’s this afternoon, speaking about Patent strategies for my company’s technology. It was a good outcome. There’s been a vague cloud of rather demotivating depression hanging over my thoughts in this area, but now I am relieved of a few groundless worries, it seems. Be gently thankful with me, if you will.