Just like it sounds, this site allows you to enter a website to see whether it's down.
And this part you could have guessed: the founder works for Twitter.
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In Sunday's NYT, an article reported that Time Warner, Comcast and AT&T were all pursuing strategies aimed at curbing so-called bandwidth hogs -- Internet users whose high-volume usage threatens to slow down everyone's Internet experience. The Internet companies like to frame the problem as a free rider problem -- if everyone pays the same price for unlimited Internet usage, then a few MMORPG enthusiasts who also download movies and video clog up the works for those who just want to check email and get directions. Users tend to fall into two, disparate camps: using Internet for checking weather, headlines and email uses less than 5 gigabytes a month. However, downloading one movie uses 5 gigabytes by itself. So, it makes sense to charge varying amounts depending on usage, just like electricity, water, long distance, cell phones usage, etc.
Except that I don't think electricity and telephones are good analogies. The electric company provides power and also delivers it. When you pay for the usage of electricity, part of that is for the infrastructure used to deliver it, but also part of your charge is for the actual product: power. When you download a movie from Netflix, your internet provider is someone different. You have a merchant on the one hand and a delivery service on the other. The burden of that delivery is borne by the internet provider, who has to come up with a way to charge you for it. The internet provider would really be happy if you didn't download that movie. (For example, Comcast's strategy is to slow down the Internet for bandwidth hogs, incentivizing less usage.) But the merchant, Netflix, will not be happy with that result. So, if internet providers begin charging "by the byte," then the online merchants who want to sell you products that must be delivered via the internet (music, TV, video, news, books) will lose business as the delivery charge rises. As consumers feel incentivized to ration their own Internet usage, then online providers will feel the pinch.
So, here's my prediction. Online providers such as Netflix, iTunes and television companies will borrow from one of two models. One may be "free shipping," a la Amazon and Zappos. The second may be something like the "toll free number," which allowed consumers to call out-of-town businesses back when long distance was almost prohibitively expensive.
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If you aren't using Firefox already, the new Firefox 3.0 may make a convert out of you. Take a look at this screencast for a quick tour of new features. I have been using Release Candidate 2 for the past few weeks, and it's great. If you wait for the official release, you may be part of a new world record. But don't wait.
By the way, my favorite Firefox add-on, Foxmarks, is available is beta for Firefox 3.0.
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In writing that last entry, I noticed that TripIt was nominated for a Webby Award.
Take a look around over there, and you will find some interesting sites, including several that I have blogged about here. Mint, the wonderful financial management tool, was nominated. So was epicurious, the recipe site that I use to cook the family meal each Sunday. TED is also a nominee.
I was surprised that I do not read any of the five nominated business blogs. Or any of the law blogs.
But I found a cool Pink Floyd site, a great site for searching airline and hotel fares, and blurb.
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IBM and Linden Lab, creator of Second Life, have entered into an alliance "to create an enterprise-class version of Second Life behind a corporate firewall." According to the IBM website: "IBM is helping clients and partners to conduct business inside virtual worlds and to connect the virtual world with the real world through a richer, more immersive Web environment."
So was this recent television commercial by IBM making fun of Second Life as a business tool? Or just the way some people use Second Life? Some discussion surrounding the ad from earlier this year is here.
On a personal note, looking at my travel schedule this summer, I would be interested to hear from people who have attended a virtual conference in Second Life. Good experience? Or not ready for prime time?
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Google is the assignee of this patent, filed last week:
At a client, a video is received. The video includes one or more advertisement slots. The video is played back to a user. During the playback of the video, an impending advertisement slot is detected. One or more advertisements are requested for placement in the advertisement slot. The one or more advertisements are received and placed in the advertisement slot.
Is this the future of YouTube? From a quick browse, I can't tell how this would differ from the television playbacks, which are now routine.
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According to the NYT, one of those supposed advantages: "a prestigious brand name."
What pops to mind when you hear "AOL"? Is it positive? Prestige?
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We'v ehad some interesting discussions here on the blog about Second Life. (See Leandra Lederman's posts on taxation here; mine on gambling, which has since been prohibited by the hosts, here.) Apparently there has been a run on the banks in Second Life!
I have never been on Second Life, but I understand that player can exchange U.S. dollars for "Linden dollars," using online banks. Then, as necessary, players can get Linden dollars for use on Second Life by having their avatars use the ATMs in the virtual world. Linden dollars also may be cashed back out for U.S. dollars. Unfortunately, these virtual banks may literally be run by an individual who may or may not invest your account dollars wisely. Although these banks promised players very high rates of interest (24% to 30%, and in one case 200%) compared to bricks-n-mortar banks, opening accounts there may also have had much higher risks than a regulated, FDIC insured institution. On bad investment that some virtual banks made was in Second Life's gambling industry, which was destroyed when Second Life banned gambling. Following that ban, there was a run on the banks in August, with players attempting to withdraw their funds at the same time. Some players found the virtual ATMs to be out of order during this crisis. The WSJ article estimates $750,000 in player losses during that time.
This week, Second Life announced that only banks with actual charters will be allowed to operate in its virtual world. Is this necessary regulation or interference with the libertarian model of Second Life? (The phrase "libertarian dream" is used in the article.) I guess if you're dumb enough to give real money to a virtual bank without knowing who owns it, what they will do with your money, and what the reserves there are, maybe you deserve to lose it?
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The first time this entry appeared on my Discovercard bill, I assumed that my wife had purchased some office supplies online:
AP9*BUSINESSMAX 888-584-2217 CT $ 14.95 Merchandise/ Retail
When it appeared three months in a row, I decided to investigate. One Google search led me to the Ripoff Report, which linked Businessmax to VistaPrint. Sure enough, my wife had purchased address labels from VistaPrint shortly after our move. In clicking an offer to receive a "free" address stamp with the order (in fact, VistaPrint charged us for the stamp, too), she inadvertently enrolled in a Businessmax membership program with uncertain benefits.
Based on the volume of complaints posted on various internet sites, lots of people have been surprised by their enrollment in Businessmax. Indeed, when I called Discovercard to dispute the charges, I got only as far as "AP9" before the customer service representative said, "Is this a Businessmax charge?"
While Discovercard was removing those charges from my account, I was calling the number above to ensure that we would not be subject to continuing charges. A fellow named "Morton" could not have been more cooperative. It's almost as if we caught him with his hand in the cookie jar.
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One of the major challenges in moving lies in establishing a new set of routines. Rather than merely replicating old routines, I have come to view moves as a short window of opportunity to make profound changes in my habits or lifestyle. My wish list for my move this summer was surprisingly long, but I will mention only two things in this post: money and health.
Budgeting has never been a strength, and though we have done fairly well on one law professor's salary, money is not sloshing around freely in the Smith household. With one child in college and four more in the pipeline -- and a much larger mortgage payment than we had in Wisconsin -- I decided to take the opportunity of our move to do some financial planning.
As one of its employee benefits, BYU offers a free consultation with a financial planner. So I assembled all of our financial information and sent it to our designated consultant. Apparently, unless you have very obvious problems -- like no retirement planning, no other savings, or excessive credit card debt -- the only thing this fellow has to offer was a slap on the back and a hearty "You're doing great!"
So I took matters into my own hands and started using Mint. The setup is simple -- just create a Mint account, then add your credit cards and checking account. Mint pulls all of your transactions and begins to classify them. At the beginning, some of the transactions ended up in strange places, and the biggest category of transactions was "No category," but I have gotten into the habit of classifying (or re-classifying) transactions, and Mint learns from the past. So I am building a history, which is the key, of course, because Mint is about detecting spending trends. (The service also suggests "Ways to Save," but I have found those suggestions completely unhelpful.) It's too early to say whether Mint will help us to rationalize our spending, but the initial signs are hopeful.
Now the harder -- and more urgent -- change: my health. Actually, my doctor in Wisconsin told me that I am in very good health ... for a fat man. No high blood pressure or high cholesterol. No heart problems or shortness of breath or diabetes. Yet. But I have been gaining weight consistently for the past 20 years, and every time I visit a doctor, the main message is simple: lose weight.
The principle governing weight loss is obvious and we all know it: burn more calories than you consume. It was clear to me that my first step needed to be ... taking more than a first step. My sedentary lifestyle had to go. The problem, of course, is that, like most fat people, I don't enjoy exercise. I needed to find something I could do without the nagging feeling that I wanted to be doing something else.
So I bought an iPod and started walking to work. That's three miles of uninterrupted podcasts/recorded books each way! When I started, temperatures in Utah were mostly in the 90s, but on some days broke 100 degrees. Frankly, I am not sure why that didn't stop me, but I kept walking. In the first month, I lost 7-8 pounds. And there is no incentive for weight loss that is greater than weight loss.
So I took the next step, recruiting my 16-year-old son to lift weights with me three times a week at the end of the workday. He is engaging, funny, and smart. We talk about his school and my work and BYU football. All the important stuff. He is a former football player, and he enjoys lifting weights, so I am counting on him to keep me on task. And to spot me on the bench press!
After classes started, I enrolled in Y-Be-Fit, a fitness and health program run by faculty and students at BYU. For $20 I received a personal health assessment -- including a blood lipid profile, a treadmill test, a trip to the Bod Pod (to measure body fat), a nutritional analysis, and various other evaluations -- and a weekly counseling session for three months. My "counselor" is a BYU student, who checks my progress, offers encouragement, and provides me with information on how to reach my health and fitness goals. Again, this is not rocket science, but it's nice to have the regular visit as an incentive to keep exercising.
As part of the Y-Be-Fit program, I was told by a BYU Professor of Exercise Science that the corollary to the caloric deficit principle (above) is that very few people successfully lose weight through exercise alone. Most of us need to make fairly extreme adjustments to our diets. That probably explains in large part why, after two months of walking to work and lifting weights, I had lost only 10 pounds. (I understand that 10 pounds is a lot for two months, but my point is that most of the weight loss occurred in the first month.)
Over the past two weeks, therefore, I have been speaking to my counselor about the need to adjust my diet. After reviewing the results of my nutritional analysis, my task was clear: less meat, more veggies. And stop eating out so much!
This has been tough. Despite a scriptural injunction to eat meat "sparingly," most Mormons are far from vegetarians. Having attended a fair number of luncheons since my arrival, I can testify that non-meat options are tough to come by at BYU. But I am slowly learning the tricks of the trade, and I had a very tasty vegetarian rice dish at a law school luncheon today.
Despite these little successes, I have been frustrated by my inability to know whether I was achieving a caloric deficit. During our session this week, my counselor suggested that I try the "MyPyramid Tracker" on the USDA's website. As with Mint, my limited experience may be insufficient to draw any firm conclusions, but I have been able to count calories rather painlessly over the past two days. Entering the physical activity numbers is more challenging, but I am going to persevere until I can develop enough history to get a feel for this new lifestyle.
By the way, at my most recent weighing, I am down 12 pounds since the beginning of August. I hope you will see even less of me the next time we meet.
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If free music seems too good to be true, it probably is. I tried SpiralFrog tonight. The software crashed my computer (which never happens on this machine). When I got the computer re-booted, navigated to the site, and tried to download a song (Bohemian Rhapsody, of course), the software went into spasms.
This may have something to do with the warning on the site: "We are currently experiencing extremely high traffic at SpiralFrog, which may be causing delays for some users. We apologize if this is you."
But even if it worked, SpiralFrog has a bigger issue: "Songs and video files that you download from SpiralFrog are not compatible with Apple's range of iPods or Microsoft's Zune."
My next step was "uninstall."
UPDATE: Marketplace is doing a series on the music industry. The second installment (here) mentions SpiralFrog, but pursue a bigger theme: mixed messages are being sent by the "Big Four" music publishers (Sony BMG, EMI, Universal and Warner) by simultaneously prosecuting people who have downloaded "free" music and attempting to market through file sharing. By the way, the first installment of Marketplace's series is here.
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Thanks to Jeff Nolan at Venture Chronicles, I have subscribed to Pownce. I am still experimenting, but if you are interested, Valleywag explains why "Pownce is the new pink."
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Whaddya do when you need to send a 40mb data file to your co-author who's in a
different city? Chances are you can't just email it. Your email server likely imposes an upper limit on attachment size for security reasons. And 40 megs is a big attachment. You could snail mail a thumb drive, but that seems archaic. You could post your file on your faculty webpage for download, but that may be a bit of a chore, especially if you don't have permission or software skills to tinker with it. Or . . . (drumroll), you could DropSend it. DropSend allows you to send files up to 1GB, or to upload and store files online. And best of all . . . (drumroll), it's free. You just have to register by (no surprise) giving them a wee bit of personal information. For free, you get 5 sends per month and 250MB of storage. Five bucks a month gets you 15 sends and 1GB of storage. And so on. It's a really nice service when you need it.
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Fred Wilson is blogging about free music as a business model:
So let's agree that it's the selling of music that's failing. What should the music business do? Watch the movie. The print companies went free, accepted advertising dollars instead of subscriptions, plugged into Google for traffic, and the money is now pouring in.
It seems so obvious and so inevitable. But there is a lot more to Fred's post, and it is well worth reading.
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One of my goals this summer is to rationalize my information gathering systems. This is, in large part, a sorting problem. Particls, which went into public beta this week, claims to have a solution:
The web is just too big. No one has time to keep track of all the sites, conversations and interesting bits and pieces that interest them. We all have real work to do and lives to live!
So what if you could subscribe to the sites you like best and be notified when they change. Particls even works out how important the new information is to you and displays a proportional alert.
For example, general information can be displayed on a news ticker, important stuff might appear on a popup alert and urgent information could be SMS'd to your phone.
Think of it like a highly advanced widget or filtered feed reader.
It's hard to get a feel for this product from the descriptions. When I see the words "news ticker," I think PointCast. And that is not a good start. But I downloaded the product yesterday, and fiddled with it.
It has a long way to go, but it has some potential. In the short time I have used it, I see three big problems:
First, my reference to downloading should trigger some reaction. They need to put it on the internet so my customization is not tied to a single computer.
Second, much of the content is too old. It's a news ticker, for crying out loud. Why am I getting blog posts from five days ago?
Third, not surprisingly, when I enter keywords to reflect my interests, the results include lots of sites that I visit as a matter of course, including Conglomerate! The ticker doesn't help me much when it displays a post that I wrote last Monday. I need to be able to exclude certain sites from the results.
With regard to my last point, I don't want to use a service like this to read "the sites [I] like best." It is more efficient for me to visit those sites directly (in the case of newspapers, like the WSJ, NYT, or WaPo) or put them into Google Reader (in the case of my favorite blogs). I want Particls to retrieve information from sources I wouldn't normally visit. And I want the information fresh ... within hours, not days.
Is that too much to ask?
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A cute name for a new search engine. Mahalo claims to be "the world's first human-powered search engine." Why use people to build search results? According to founder Jason McCabe Calacanis, "humans using machines can create much better search results than machines alone."
The early results are impressive. Just click on any of the search terms on the main page and behold!
But expect lots of gaps. The product is only in "alpha," and it is missing much more than it has. Especially terms relating to business. No "hedge funds." No "insider trading." No "corporation"!
Still, it's a nice start and an elegant site.
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Amazon wants to sell music without digital rights management software. (W$J) Amazon said it has made deals with "more than 12,000 record labels," but it didn't answer the two most important questions: Will Amazon sell from major labels other than EMI, like Universal, Sony BMG, and Warner? What's the price?
In any event, investors liked the news. Amazon's shares climbed over 3.5% today.
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If you have been searching for a Joost invitation, you can get one here courtesy of GigaOM. Joost stumbled a bit coming out of the gates, but things are working fine now. The software is easy to install, and the picture quality on my 30" monitor is fair (grainy, but not horrible). The biggest limitation at the moment is content, which is skimpy. But Joost is working on it.
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Speaking of turnarounds, Amazon is doing it. A year ago the company's stock was in a freefall, but today brings the news that Amazon more than doubled its net income while increasing sales by 32%. The W$J headline reminded me of the days when Jeff Bezos was an internet rock star. He was Time's Person of the Year in 1999, but nowadays I hardly ever see him. Relieved of the burden of explaining e-commerce ad nauseum, he now fills part of his newfound free time investing his fortune through Bezos Expeditions, his private equity fund. In the meantime, one thing hasn't changed: Bezos still has commentators guessing about what is really going on at Amazon.
UPDATE: Groceries? I had no idea that Amazon was selling groceries. When I look at the list of Amazon's product categories, I am reminded of Bezos' expansive vision for Amazon and marveling at the fact that it seems to be coming true.
UPDATE2: Here is an excerpt from that Time Person of the Year article linked above. Transport yourself back to 1999:
And he is still losing his pants. That's maybe the one thing people still really don't understand about the e-commerce revolution. If these are such hot businesses, then why are they hemorrhaging cash? Amazon--the company everyone wants to be like--could lose nearly $350 million this year. O.K., the Net is different, but don't profits and losses matter anymore? They do. Bezos insists Amazon's oldest businesses--books, music and video--will be profitable by the end of 2000.
But Amazon's losses are also a sign of the New Economics of Internet commerce. These new rules spring from the idea that in the new global marketplace whoever has the most information wins. While it used to be sellers who had all the information, buyers are getting smarter and smarter. At sites like mysimon.com it's possible to go shopping and search not only Amazon but also the collections of two dozen other booksellers to find the best deal. And in coming years--heck, at Net speed, in coming months--it will be possible to find the cheapest price on just about anything: wines, CDs, perhaps even body parts.
...
There is, in all this, a kind of humanness that is exactly the opposite of what online shopping was supposed to be like. Amazon is not a depopulated, Logan's Run kind of store. The site allows readers to post their opinions about books, to rate products, to swap anecdotes. As you sit there reading, say, a literate and charming book review from Bangladesh, the real power of the Amazon brand comes home. It is a site that is alive with uncounted species of insight, innovation and intellect. No one predicted that electronic shopping could possibly feel this alive. If it is a sign of an e-world yet to come, a place in which technology allows all of us to shop, communicate and live closer together, then Jeff Bezos has done more than construct an online mall. He's helped build the foundation of our future.
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Jason Pontin takes a crack at understanding Twitter:
My own experiences with Twitter were mixed. I quickly realized that decrying the banality of tweets missed their point. The only people in the world who might be interested in my twittering — my family, my close friends — were precisely the ones who would be entertained and comforted by their triviality.
But I also strongly disliked the radical self-revelation of Twitter. I wasn’t sure that it was good for my intimate circle to know so much about my daily rounds, or healthy for me to tell them. A little secretiveness is, perhaps, a necessary lubricant in our social relations. I wondered whether twittering could ever have broad appeal.
I haven't used Twitter a lot, but this doesn't make sense to me. The messages are simultaneously banal and "radical self-revelation"?
In my view, they are neither. The answers to "what are you doing?" are varied enough to be interesting, but short enough to allow for private space. Twitter is an ingenious vehicle for maintaining relationships or building communities, and I agree with Evan Williams, the founder of Obvious (the company that created Twitter): "It adds a layer of information and connection to people’s lives that wasn't there before."
Perhaps the bigger issue is whether Obvious can monetize Twitter without ruining the service. Pontin is skeptical. Williams is not worried about that now, but claims to be confident that they will find the answer. I'm with Williams, assuming he can scale the service to keep up with demand.
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Bryan Camp of Texas Tech Law School has posted on SSRN an interesting paper on the taxation of events in World of Warcraft (WoW) and Second Life. As I understand Bryan's argument, he would treat exchange transactions within both worlds as "imputed income," which is not taxable under federal income tax law. He thus comes out in favor of a "cash-out" rule for determining tax liability in both worlds. Bryan adopts the "magic circle" analysis of virtual worlds—which he also analogizes to theater's "fourth wall"—the notion that activity within the virtual world is separate from our world and thus without consequences in it.
Bryan and I agree on the end result of non-taxation of exchanges within WoW under the federal income tax (per my previous post on this issue), although I take a different path to get there. However, I disagree with the magic circle notion; my view is that virtual worlds exist within our world, not outside of it. Accordingly, my position is that there is no magic circle that shields all activities within virtual worlds from taxation; we have to look more carefully at each world and the activities within it. I therefore do not agree that a magic circle protects conduct within Second Life.
Bryan recognizes at the end of his paper the possibility that Second Life will become commodified to such an extent that its activities would warrant federal income taxation. The view he expresses is that transactions within Second Life should be taxed once businesses begin accepting Lindens (Second Life's currency) for real-world services. He comments that that will make Second Life essentially into a barter club (which posed a huge tax compliance problem in the 1970s, before the IRS cracked down on such clubs).
I share that concern. However, my view is that, given the magnitude of economic activity already existing within Second Life and the number of real-world companies already established there, adopting a policy of non-taxation of Second Life activity inevitably would foster the kind of commerce that Bryan views as tipping the balance toward taxation. Christine's excellent post on gambling within Second Life sheds light on this: If conducting an activity within Second Life draws a magic circle around it that exempts it from the laws that otherwise apply to that activity—and would apply to that activity if it were conducted elsewhere on the Internet—then that activity will likely move to Second Life. It seems inappropriate as a policy matter to allow a business to escape regulation that applies to its competitors simply because of the particular platform used to conduct the business.
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Fred Wilson points to an interesting first post at comScore Voices on the demographics of browser usage. Fred captures the findings in this provocative headline: "Firefox Users Are Rich Young Men."
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Thanks to everyone who posted comments on my first post on virtual tax. As promised, this one discusses Second Life. For those who are unfamiliar with it, Second Life is a different type of world from World of Warcraft (WoW) and other game worlds. Second Life provides a virtual environment and basic avatars but leaves it to participants to provide most of its content. Its Terms of Service allows users to retain intellectual property rights in their content. Second Life earns its revenue from selling "premium" memberships that allow "ownership" of land and from monthly land use fees. Basic membership is free.
Second Life can be used as a type of chat room for avatars and for entertainment activities, such as going to a concert. Second Life also facilitates commerce. It provides the LindeX, an in-world exchange for its currency, Lindens (though it purports merely to license Lindens to users). Second Life users can do things like create a line of cool T-shirts for avatars that they sell copies of for Lindens. Real-world business such as Adidas have joined Second Life, selling virtual items for avatars and promoting their real-world products.
How should transactions within Second Life be taxed? My view is that, from a policy perspective, the right result is to tax commercial activity within virtual worlds but not game play. Thus, if Anna is a Second Life entrepreneur raking in the Lindens and Bert uses Second Life to build and furnish a virtual castle to hang out in with his friends, then, as a general matter, Anna should be taxed on her Second Life activities, but Bert shouldn’t be. The problem is how to reach that result.
One possibility would be to provide a "cash-out" rule, along the lines of what I proposed for WoW. The problem I see with this is the extent to which Second Life is a medium for commerce. WoW focuses on a game with a general storyline and goals and prohibits real market trade. Second Life encourages commerce and not only allows but facilitates the exchange of Lindens for dollars. Were sales for Lindens not taxed, that would encourage excessive allocation of resources to virtual businesses. Deferral of taxation would be a larger problem in Second Life than in WoW because of the larger array of business opportunities and the lower risk of deferring cashing out that the legitimacy of exchanging Lindens for dollars provides. Failing to tax sales of virtual items in Second Life could also facilitate tax evasion by sellers who purport to sell a virtual item but actually sell a real one (for Lindens).
Thus, I think the better result is to tax sales within Second Life (for Lindens). That would result in the imposition of tax on commerce such as Anna’s. (Information reporting by Second Life might be required for effective enforcement of the tax.) It would also, at least in theory, tax sales by play-minded users, but the likely outcome for someone such as Bert would not be any actual federal income tax liability because only profit would bear tax. That is, because the expenses of an income-producing "hobby" can be deducted from the income from the hobby under IRC section 183, someone like Bert, who spends more on Second Life than he brings in from it, would not actually owe any federal income tax on his Second Life activities.
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Another intriguing idea for Firefox: The Coop. I see lots of possibility here, not just for the usual social network fodder, but for co-authors.
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Thank you, Gordon, for the kind introduction, and to my Conglomerate hosts for the chance to guest blog. Gordon mentioned that one of the things I’ve been working on lately is the question of how virtual worlds should be treated by the federal income tax. For those who are unfamiliar with them, virtual worlds include such popular massive, multi-player, online role-playing games (MMORPGs) as World of Warcraft and Everquest. They also include virtual environments that aren’t as structured, such as Second Life. Today’s post will focus on World of Warcraft (WoW); I’ll discuss Second Life in a subsequent post.
In WoW, players complete quests and raids to take an avatar from level 1 to level 70. As Professor Richard Bartle has described, these games allow ordinary people to engage in a "hero’s journey." Players buy the WoW software and pay a monthly subscription fee for access. They can earn "loot" that has value in the game when they kill computer-generated monsters (MOBs). There is an in-game currency (gold) and an in-game economy in which players can buy, sell, and trade items with each other. WoW’s Terms of Use forbids "real market" trade in game items, but it happens all the time.
Games like WoW raise income tax issues, in part because items in them, though part of a "game," have real market value. In the paper Gordon mentioned, I discuss two of the issues: the taxation of loot "drops" and the taxation of exchanges within the game, such as the exchange of a virtual sword for gold. From a policy perspective, my view is that drops and purely in-game trades should not bear income tax. One of the problems with taxing them would be the regressive nature of the tax because players who put in the most time and the least money would owe the most tax, although players who put in the most time (40-80 hours a week or more) tend not to be employed full-time (e.g., students). Players with higher incomes tend to be those putting in less time; they tend to spend money in the "real market" in lieu of hours of "grinding" to level up. Such a tax would also pose administrability issues because of its enforcement difficulties. For these reasons and others, I argue that players of games like WoW should be taxed if and when they cash out—that is, on real market trades. That approach would allow those playing for entertainment not be taxed on their game play (beyond the tax they already paid on the money spent on the game), while catching most profit-seeking activity.
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I confess to being a bit of a residential real estate voyeur. Like others of my ilk, I sometimes browse the real estate listings in my neighborhood or town just to get a sense of what’s out there. I’ve used Realtor.com and ZipRealty, among others. I’m still waiting for the internet to become the great equalizer for the consumer. Standard broker commissions haven’t gone down much, as far as I can tell, although fee-for-service arrangements appear to be more common, and DOJ is currently prosecuting an antitrust suit against the National Association of Realtors for its “blanket opt-out” rule, which enables traditional brokers to inhibit online brokers from providing complete MLS listings to their customers.
It was interesting to see Zillow, a relatively new real estate website, as the subject of a recent Fortune cover story. Zillow is trying to innovate, to go above and beyond the basic internet listing site. It is intensely data-focused, unlike most real estate sites. It aspires to collect and analyze lots of data on every house in the nation, in order to be able to offer accurate valuations across the board. The site collects publicly available information on each home, and also allows a homeowner to update existing information on her house. Zillow’s proprietary valuation algorithm calculates a “Zestimate” of the value of each home once enough data has been obtained. Apparently, much or most of the data used to Zestimate a house are publicly available. It’s another nice example of the power of the internet to aggregate “small” information—lots of little bits of data, each piece of which may be useful to only a handful of people, such that collection, analysis, and dissemination just wouldn’t be cost-effective pre-internet. (See here for another example).
Zestimates are far from perfect, of course, and there are lots of parts of the country where Zestimates are either unavailable or way off. To its credit, Zillow gives statistics showing Zestimates coverage (as a percentage of all houses) in major metropolitan areas, as well as ratings and statistics on Zestimates’ accuracy in each market, including median error as a percentage of selling price and percentage of Zestimates within 10% of selling price.
The site also has amazing “bird’s eye view” photos of houses from multiple perspectives. They’re taken from fairly close up—much better, say, than Google satellite photos. I can actually “walk” down the street of my childhood home, identifying each house on the street. Another interesting innovation is the Make Me Move option, which allows a homeowner to effectively announce to the world the price at which she’d be willing to sell, without actually going to the trouble and cost of a formal listing. Potential buyers can email the owner via the website. I was a little surprised at how popular this Make Me Move tool is. There are several hundred Make Me Move homes in Atlanta, and almost 70,000 nationwide.
Worth a look.
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Twittermap. Twittervision. (Wow!)
Twitter explained. (Maybe you should start here.)
Twitter's on the front page of Financial Times?
What am I doing? Registering with Twitter.
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Hot on the heels of an announcement that growth in internet advertising is slowing down, Yahoo! is thinking about paying $1 billion for Facebook. Fine. NewsCorp bought MySpace, and that is looking like a good decision, but I suspect that the executives who are negotiating these deals are more than a little bit concerned about this:
The danger of building a business around networking sites -- which also include Friendster, Bebo and myriad smaller players -- is the fickle nature of their consumers. As the Internet has sped up the life cycle of success and failure, it is possible some of these sites will flame out as their young devotees flock to the next thing.
Possible?
Let's play intertemporal executive: in 2010, will MySpace and Facebook seem like eBay and Google today? Or will they seem more like Alta Vista or Globe.com?
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Yahoo! and Google stock are plunging today after Terry Semel, Yahoo!'s CEO told investors at a Goldman Sachs conference, online advertising revenues from automotive and financial services companies are "still growing but they're not growing as quickly as we might have hoped at this point in time."
Is this the beginning of a broader retrenchment in advertising revenues? Too early to tell. But it isn't too early to second-guess a business strategy that depends entirely on the growth of internet advertising.
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Apropos my post yesterday on Web 2.0, The Ponderings of Woodrow rants against Wikipedia's decision to delete the removal of "Enterprise 2.0" from Wikipedia. Here is the explanation from Wikipedia Artw, who made the change:
Neologism of dubious utility. I can find examples of it's use online but there doesn't seem to be a consensus on what it means other than "sort of like Web2.0, but businessy"
Here is the best part of Woodrow's rant:
For someone who's assailing the validity of a neologism, does anyone else find it downright ridiculous that he used the term "businessy?" in defense of the deletion? "Businessy?!?!?"...if that half-cocked neologism isn't a clear indication of just how out of focus the editor is with the business world, I don't know what more needs to be said.
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Despite all that's been written on the topic, I'm still not sure I understand what Web 2.0 is, but Seth Godin embraces this simple definition from Wikipedia: "Internet-based services that let people collaborate and share information online in a new way." According to Seth, "Google doesn't make the cut, because most of their traffic comes to their search engine. eBay is an 'old' company, but the many-to-many nature of the site means that they do." Hmm.
Anyway, if you can suspend your skepticism of the underlying concept, you will find Seth's ranking of Web 2.0 companies here. I am not very interested in distinguishing Web 2.0 sites from other sites, but I find the relative popularity of the listed sites interesting. Perhaps the most surprising to me is that LinkedIn is listed among the top 20. I created a profile on LinkedIn a long time ago after getting an invitation from someone, but I never use the service.
I recognized most of the companies in the top 50, but hardly any in the bottom 50. As I visited some of the fast-rising sites, I wondered what the new Web 2.0 ideas would be. The current options: creating web pages, sharing photos, listening to music, collecting virtual friends, chatting with anyone, buying and selling junk, tagging everything ... and various combinations of the foregoing. That pretty much encapsulates life on the itnernet, no?
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From W$J:
The nation's technology capital lost 185,000 jobs, or one in five, between 2001 and 2005. This year, state economists expect a net inflow of people into the area for the first time in six years.
Just as noteworthy as the comeback is the source of all the new jobs. For the most part, it isn't giants such as Cisco Systems Inc., Sun Microsystems Inc. and Intel Corp. They're adjusting to slower growth rates and in some cases continuing to shed workers. The biggest demand comes from thousands of small and midsize companies and start-ups ..., suggesting that Silicon Valley's entrepreneurial ferment survived the bust just fine. Companies are typically looking for experienced workers who are well-versed in hot technologies.
And, yet, fears of recession seem to be spreading elsewhere in the U.S.
Some used to talk about creating "the next Silicon Valley," while others argued that there is only one. Well, Silicon Valley is looking pretty unusual right now.
HT Darian Ibrahim.
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You have heard about AOL's release of private data from its users. If you want more detail, Techcrunch has most everything you need to know, but you might want to check out the NYT story, "A Face Is Exposed for AOL Searcher No. 4417749." Everyone -- even AOL -- agrees that this was an outrageous blunder. The big issue now is what to do about it going forward. Jason Calcanis wants AOL to turn off the log files, and at this point, it may be the only option AOL has if it wants to win back the trust of its (former) users.
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Fred Wilson is hyping The Hype Machine: "It just proves that aggregating music blogs (letting the people create a music service) is better than trying to work with the record labels to create one."
Fred convinced me to take a look. I searched "Garfunkel" and found a short list of songs by my favorite singing duo, and Hype Machine streams all of them to my computer seamlessly!
You can get much longer playlists by searching "Beatles" or "U2" or any recent flavor of the month. For example, here is the playlist for Nelly Furtado:
You can't download the tracks from The Hype Machine, but with a site that is this easy to use, that will be only a minor annoyance for most users. Plus, if you really want a track, just go to the blog where it was originally posted.
Oh, perhaps you are worried about copyright? No worries. From The Hype Machine:
The Hype Machine supports and respects the artists, writers, editors and producers who create original content available on the web.
The Hype Machine site users are encouraged to enjoy legitimate downloadable media and support artists by purchasing music after sampling it online. We provide full acknowledgement of the source and author for all audio that provides it - and we recommend that blog publishers include appropriate metadata when making audio available on the web. We also provide links to purchase music from Amazon.com, iTunes Music Store and the eMusic digital music store, where possible.
Additionally, authors of all postings that we index are clearly identified whenever they appear on the Hype Machine website or in the search results. All such mentions have a link to more information about the specific blog and a link directly to where the post appears on the Internet.
As a search/indexing engine, we enable users to find all sorts of audio. We can't be responsible for what people post on their blogs, and we can't be responsible for what you do with it when you find it.
The search/indexing interface contains links to other weblogs/websites. The Hype Machine neither controls nor endorses these web sites, nor reviews or approves any content appearing on them. The Hype Machine does not assume any responsibility or liability for any materials available at these web sites, or for the completeness, availability, accuracy, legality or decency of these sites.
The Digital Millennium Copyright Act of 1998 (the "DMCA") provides recourse for copyright owners who believe that material appearing on the Internet infringes their rights under U.S. copyright law. If you believe in good faith that materials we link to infringe your copyright, you (or your agent) can contact us requesting that we remove the links to the material.
Ok, my "no worries" comment obviously was tic. As far as I can tell, the Recording Industry Association of America has not launched an offensive against The Hype Machine, Elbo.ws, G2P, and other sites that link to copyrighted music, but that can't be far away. Last month a Dutch court shut down Zoekmp3.nl (more here), which seemed to offer a similar service. The underlying legal rules are different, but the common theme is that the sites are linking to infringing materials.
The DCMA provides some safe harbors for linking by service providers, but those safe harbors require that the service providers not have actual or constructive knowledge of copyright infringement. Could The Hype Machine make that argument with a straight face? I would be interested to hear from the copyright gurus on this issue.
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This cover and its accompanying story have been getting a lot of play on the blogs ...
Check out Jason at 37signals, Scott at Wordyard, Mike at 9rules, and Paul at Infectious Greed ... in decreasing order of outrage.
The problem is that Kevin Rose has not made $60 million from Digg. Not even close.
Where did BW get that number? The article contains these sentences: "So far, Digg is
breaking even on an estimated $3 million annually in revenues.
Nonetheless, people in the know say Digg is easily worth $200 million." Add this sentence: "Rose ... owns 30% to 40% of the company (he won't specify)." And voila! You get $60 million! (Or $80 million! Why not $80 million on the cover? Were they really trying to be conservative?)
Well, if the point was to get me to read the article, it worked.
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Here.
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TechCrunch: "Digg is looking more and more like the newspaper of the web, and is challenging even the New York Times on page views (Digg surpassed rival Slashdot long ago)."
Wow! I had heard of Digg, but never visited. So I sauntered over there, and found this as the top link.
Well, I suspect you wouldn't get that from the NYT.
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Fred Wilson (that is, the New York VC Fred Wilson) isn't. Apparently, Ann Althouse is. I'm not, but Robert Scoble thinks "everyone is important."
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Bill Tancer at Hitwise offers an interesting comparative analysis of market share of three internet heavyweights: Google, Yahoo!, and MSN. Google tops the list for search (47.4%), but Yahoo! dominates email (42.4%) and business/finance (34.9%) and also leads in news (6.3%). The top mapping site is Mapquest (56.3%), with Yahoo! Maps coming in second and Google Maps lagging far behind in third. The biggest surprise to me: Gmail ranks fouth in email, with only 2.54% market share.
UPDATE: I have been writing skeptically about Google's products for a long time, and I know that I am not alone. But it seems like traffic in this genre has picked up lately. Here are a couple of recent posts from Paul Kedrosky (see also here and here) and Om Malik.
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A humbling story from SiliconBeat.
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Have you downloaded IE7, yet? I just put it on both of my computers, and my first impressions are very positive. As is its custom, Microsoft has learned from the competition, adding tabbed browsing, beefing up security, and improving IE in myriad other ways. Even Firefox devotees like the new browser.
Google, Yahoo!, and Viewpoint toolbars all are built in, but there is no need to bother with a separate toolbar if all you want to do is search. The new Toolbar Search Box allows you to search from your favorite search engine. My old IE6 was set to search with Google, and the new browser inherited that preference. For people who have not set the preference in IE6, the default search engine is MSN, and that has prompted charges of foul play from Google.
As in Firefox, CTRL/T opens a new tab, and CTRL/W closes it. IE7 also provides a "Quick Tabs" screen that allows you to view all of the open tabs simultaneously. Very cool. Even cooler is the Tab Group, described by Paul Thurott:
Once you have a group of tabs open, you can save the group as special kind of Favorite called a Tab Group, and you can even specify a Tab Group as your home page; that's right, you can configure IE to open multiple documents every time you start up. That way, you might choose to visit a number of news sites first thing in the morning, and run through them over coffee. It's a great feature.
I second that!
The browser looks nice, too. "Sleek" is the adjective applied by Micro