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- THE FRIDAY LETTER -
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from Gilder Publishing,
for friends and subscribers)
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| http://www.gilder.com/ | Issue 340.0/May 9, 2008
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HEADLINES:
- The Week / Kessler: The War for the Web
- Friday Feature / Forbes: How it Went Wrong & How to Make it
Right
- Friday
Blogger Bonus / Gilder: Putting it All Into Perspective
- Readings /
|
GILDER/FORBES
TELECOSM 2008: The exaflood Nicholas CARR:
The Big Switch, Rewiring the World
|
The Week / The War for the Web
Andy Kessler, Wall Street
Journal (5/6/08): Microsoft was smart to walk away (for now)
from its $44 billion bid for Yahoo. It's never good to overpay. But the
software giant – whose stock has flatlined for eight years – was onto the right
strategy in looking to the Web for growth.
Can't Microsoft build something on its own? Why the rush to pay billions for
Yahoo? The simple (and wrong) answer was that adding Yahoo's 20% Web search
market share to Microsoft's 10% meant that it could compete against Google's
60% share. Technology changes too fast for that to make sense except on paper.
Programs run anywhere these days – on your desktop computer, on servers in data
centers, on your iPod, cellphone, GPS, video game console, digital camera and
on and on. It's not just about beating Google at search, it's about tying all
these devices together in a new end-to-end computing framework.
With
the Microsoft/Yahoo deal breakdown, everyone assumes Google walks away with the
prize. Not so fast. This contest is just starting. For Microsoft or Google or
anyone else to win, they need four key elements of an end-to-end strategy:
- The Cloud. The desktop computer isn't going away. But as
bandwidth speeds increase, more and more computing can be done in the network
of computers sitting in data centers – aka the "cloud”….
- The Edge. The cloud is nothing without devices, browsers and
users to feed it….
- Speed. Once you build the cloud, it's all about network
operations. Whoever can deliver search results faster, wins….
- Platform. Yahoo's mistake was relying on expensive workers to
update Web pages and sell ads, and especially to run Yahoo Finance, Sports,
HotJobs and Travel. Google hates using people for these tasks. The company may
love programmers and probably customers as well, but it tries to put absolutely
no one in between them. Google's genius was to automate all its Web page
creation and to have a market set prices for ads….
At
the moment, neither Google nor Microsoft, or anyone else, has nailed down
cloud, edge, speed and platform. All the loosely coupled electronic devices in
our pockets need to work together seamlessly with Facebook applications in the
cloud. Who will do it? Unclear.
The
continuing battle between Microsoft and Google will mean fierce competition –
adding features, building data centers, cutting deals and spending money on
speed and customer convenience. That's the way to move technology forward. It's
great to see Microsoft with some fight left in it. Not only hasn't the Internet
yet matured, it's becoming an ever-more high stakes game.
READ THE COMPLETE ARTICLE: http://www.andykessler.com/
Hear ANDY
KESSLER speak at Telecosm 2008.
register online today: www.TelecosmConference.com
|
FRIDAY LETTER BOOK OF THE MONTH Covering the range of global warming
claims, from the famed "hockey stick graph" to a predicted rise of
mosquito borne diseases, the book is fascinating and even profound on the
flaws of computer modeling, the irrelevance of consensus to science, the
crippling effects of excessive specialization, and the mounting evidence of a
coming cooling trend. It ends with a cogent explanation of how carbon taxes
and offsets devastate the environment. --
George
Gilder |
Friday Feature / How it Went
Wrong—and How to Make it Right
Steve Forbes, Forbes.com “Fact and Comment”: (5/5/08): Since World War II most
countries have regarded monetary policy as a critical instrument (the other
biggies being government spending and taxation) in regulating the economy. If
economic activity is slowing, so the thinking has gone, the central bank should
rev up the printing presses: The extra money will stimulate growth. Conversely,
if the economy is growing too quickly, the central bank should tighten up on
money creation, slowing things down to avoid the economy's careening off the
road in the equivalent of a car wreck. The longest-serving Federal Reserve
Chairman, William McChesney Martin Jr., liked to say that it was the Fed's job
to take away the punch bowl just when the party really gets going.
This is a misbegotten view of what central banking's main mission should be. The Federal Reserve should have two key tasks--and only two: preserving the integrity of the dollar and dealing vigorously with financial panics to limit unnecessary damage.
It
is a colossal conceit for the Fed to think it could guide something as mammoth,
sprawling and diverse as the U.S. economy. Yet even Greenspan, who for much of
his life was something of a libertarian, fell prey to this form of governmental
narcissism. The Wall Street Journal's long article about Greenspan
contains these revealing sentences: "Mr. Greenspan expected his [easy
money] policy to boost housing because the rest of the economy was relatively
unresponsive to lower interest rates. Based on decades of his own research, he
believed a buoyant housing market would spur consumers to borrow against home
values and spend more," thus boosting the economy. (The real stimulus to
our recovery from the 2000--01 recession was the 2003 Bush tax cuts. The lower
rates on personal income, capital gains and dividends, as well as some
incentives for business to invest, quickly put the sluggish U.S. economy back
on a growth trajectory. Real growth rates soared from almost nothing to between
3% and 4% right through the third quarter of last year.)
The
consequences of central banks' trying to guide their economies are routinely
disruptive, if not destructive….
READ ON: http://www.forbes.com/columnists/global/2008/0505/009.html
Hear
STEVE FORBES speak at Telecosm 2008.
register online today: www.TelecosmConference.com
|
The Gilder Telecosm Forum To
learn how to join this powerful network of talented, tech-savvy investors and
thinkers online daily to debate, discuss, and decode new and emerging
technologies and share valuable and actionable investment advice, visit www.Gildertech.com today. |
Friday Blogger Bonus / Putting it All Into Perspective
Gilder Telecosm Forum Member (5/6/08): Just viewed this May 5 interview with Syed B. Ali CEO
of Cavium (http://tinyurl.com/69hnz7)
George Gilder, Gilder Telecosm Forum (5/6/08): Syed Ali of Cavium (CAVM) will speak at Telecosm
2008, together with Eli Fruchter of EZchip (EZCH) and Ron Jankov of NetLogic
(NETL). They will be grilled by Andrew Schmidt (Nyquist Capital) among others.
Other speakers include the splendid CEO of Luxtera, Greg Young, the
incandescent inventor of Ethernet Bob Metcalfe, NVIDIA (NVDA) chief
scientist David Kirk, and Jules Urbach, yesterday noticed by Variety as
one of the ten leading innovators in Hollywood, who is transforming the worlds
of graphics, datacenters, digital entertainment, and film production. We'll
also have new nanotech companies and a debate about venture capital strategies.
My daughter Louisa will present the themes of her soon-to-be-published
book on entanglement physics (Knopf, Nov. '08) and
Lawrence Solomon will show that Global Warming Deniers
comprise a constellation of leading scientists far more distinguished
than the exponents of climate change. Richard Vigilante will describe the new
publishing techniques that permitted his company to propel two books, including
The Deniers onto bestseller lists within about three months after
receiving the completed manuscripts.
Carver Mead and Steve Forbes will put it all into perspective.
Hope to see you there at Sagamore Resort in Bolton Landing, NY. The
conference begins with a cruise on Lake George on the evening of May 27 and
runs through the 29th.
To read more of
George Gilder’s posts and those of the Gilder Telecosm Forum members, visit http://www.gildertech.com/ and become a Forum
member today.
__________________________________________
Readings /
Cisco
reports 5% drop in quarterly profit
http://www.marketwatch.com/news/story/cisco-reports-5-drop-profit/story.aspx?guid=%7B6C723017%2D4D1F%2D4D15%2DB9CE%2DDF7B87606787%7D
Nanowires for Displays
http://www.technologyreview.com/Nanotech/20728/
The Candidates on Technology
http://www.technologyreview.com/Biztech/20726/?a=f
So What is “plan C” for
Microsoft Search?
http://news.wired.com/dynamic/stories/M/MICROSOFT_PLAN_C?SITE=WIRE&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2008-05-08-17-04-35
Biologists Enlist Online Gamers
http://www.technologyreview.com/Biotech/20738/?a=f
Ministers find online world time consuming
http://www.scrippsnews.com/node/32945
Apple
developing 3D gaming controller for Apple TV
http://www.appleinsider.com/articles/08/05/08/apple_developing_3d_gaming_controller_for_apple_tv.html
__________________________________________
Friday Letter Editor: Mary Collins George / mcollins@gilder.com
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