I means to end "Means and Ends"

No not really. I find myself in an interesting 18th-century conversation with Jamie Lewis, of Burton Group. It's 18th-century in the sense that months and months pass between responses in the conversation, which is unusual in the warp-speed world. How I find myself here is via a little vanity-surfing on Google that turned up a blog post of Jamies' from February which was a response to a paper I'd written a while before called "Digital Identity Religion and Information Dogma." The paper itself was not so much a response as an extension to Jamies' thoughts in his own paper, "Means and Ends: Identity it Two Worlds." If I'd known about this earlier, it would have made great conversation at Digital ID World, in SF, in May. But I didn't. Anyway . . .

In his post, Jamie says,

Grayson seems to have gathered from "Ends and Means" that I think the "consumerist and corporatist views" of identity management "shall meet eventually in some state of balanced dissatisfaction." My point in that piece, though, was to make the point I've made in other places: that one size does not fit all, that both sides need to do what fits their needs, and that need a metasystem that will allow them not to just co-exist, but to interoperate as needed. To me, that's not a "state of balanced dissatisfaction," but one of appropriate balance and enablement.

I'm now merely here to assure one and all that I do agree with Jamie -- was inspired, in fact. His words above in explaining his meaning require no response from me. More important though, I want to assure you that "state of balanced of dissatisfaction" seemed like a nice turn of phrase. It is also, I think, an honest projection of likely outcome. It almost has to be when there are competing interests that meet in the middle: everyone is satisfied, it's true, but they have to be a little dissatisfied as well. Glass half-full -- glass half-empty. It shouldn't change the message.

The operative words in the phrase start just prior to my self-referential quote: shall meet. They will meet and they will give and take on both sides. There will be balance, and it will be contextual and driven by unique needs and circumstances. Those are the ends. The means are systems that can be applied in multiple contexts.

More pointedly, having now re-read my essay, I think that the underlying thrust of what I was trying to say (Roughly that the way we all see (personal) information informs how we will deal with it, and, since there are dramatically different understandings of that information -- who "owns" it, etc. -- resolving the digital identity systems may be more persistently tricky than we anticipate. So, we might be well advised to at least bring out into the open this critical underlying -- one might say "structural" -- premise.) remains largely unaddressed and unresolved at large within the so-called discussion.

To you.

I don't want to belong to any club that will accept me as a member.

Groucho. Always pithy. There's something fascinating about aSmallWorld, an online club that desocializes (or at least limits -- like Hutterites or Amish) the broad social network opportunity proposed by the WWW. From its landing page:

aSmallWorld is an invitation-only online community which is not open to the public. It is designed for those who already have strong connections with one another.Which is not to say that I don't understand and can't appreciate the objective: to rid the online social networking environment of leeches and inject some social trust into the network. Still, feels a little unusual -- a little . . . "restricted?"

Posted by Grayson at 07:35 AM

Good morning. Welcome to Attack Vector 459

Inevitability. The Washington Post carries an article today (Hackers Skip Windows to Embed New Infections) that points out hackers are moving beyond operating systems and the hum-drum of browsers to infect systems. This, according to a report by SANS Institute, of Bethesda. A snip:

Hackers now often bypass operating systems, staying one step ahead . . . For example, worms, viruses and spyware can now infect machines when users simply visit certain Web sites, rather than requiring victims to click on a malicious e-mail or file. Individual songs delivered via trusted programs such as the RealNetworks media player or iTunes can be vehicles for malicious code that can cripple machines or open them up to remote control by hackers.

And so Kim Cameron sayeth

The last post I made, below is entitled, "I still don't understand privacy, but maybe it's a language barrier." It is about the inadequacy of the vocabulary we're using to develop the digital identity "world." (And, I appear to have confused the author of the "Seven Laws of Identity" with a short-term former Canadian prime minister . . . my bad and now repaired.)

That was yesterday. So, I find it almost serendipidous if not synchronistic to find the following quotation in a post by Kim Cameron:

But talking later with my excellent friend and partner Adele Freedman, she pointed out in an irritated sort of way that in the non-digital world, identity and anonymity really are exclusive. Anonymity is "the quality or state of being unknown or unacknowledged." But identity is, "the collective aspect of the set of characteristics by which a thing is definitively recognizable or known."

So my takeaway is that we need to improve the way we talk about this. [This emphasis mine]

Amen.

I still don't understand privacy, but maybe it's a language barrier

Yesterday I posted why I thought junk paper inside bank statements addressed to me could hardly be a breach of my privacy. That in response to the Canadian Privacy Commissioner's finding to that effect. This morning, a colleague dropped the following quotation on my desk:

Civilization is the progress toward a society of privacy. The savage's whole existence is public, ruled by the laws of his tribe. Civilization is the process of setting man free from men.

Ayn Rand

[Admission: I haven't read Ayn Rand's work firsthand, but what I've ingested through others' interpretations and preaching of her philosophy of self-interest -- particularly since Reagan's administration -- has troubled me.]

First things first. This is exactly what I was saying in the second paragraph of my post: "It is a wickedly individualistic imperative that in many instances allows for and encourages an individual to extricate herself from the group (the market, the customer base, the social network, etc.)." Good to know the thought comes with philosophical pedigree. Am I the only one, though, that finds the statement ironical -- if not entirely self-contradictory -- in the highest order? Is "civilization" in Rand's world the imperative toward anti-socialism? What's the ultimate end? Not very encouraging for what is by all accounts a social species.

The quotation was merely the catalyst for this post. Without it I would never have returned to make the following (laboured) point: some of the intractable challenges of identity (especially the non-technical notions of information "ownership," privacy, and so forth) are the direct result of having the wrong language for dealing with digital identity. Let me elaborate using this privacy issue as the example.

Let's start with "private." According to the OED there are several definitions, the ones most relevant for us being:

1 belonging to an individual; one's own; personal (private property).
2 confidential; not to be disclosed to others (private talks).
3 kept or removed from public knowledge or observation.
4 a not open to the public. b for an individual's exclusive use (private room).

These are operative definitions for most things, but tend to be most applicable to tangible, observable things. Each definition presumes exclusive right to the thing being held private. Things that can be made private have another commonality: readily definable limits if not "owners." Where it gets dicey is with less tangible things, like ideas and information, or -- more pointedly -- to knowledge where ownership is uncertain.

Information, regardless of type, is essentially data within a meaningful context. The providence of data analytics and databases and directory structures is to aggregate, store, parse, and make data into meaningful information. Personal information -- or the more specific personally identifying information -- is contextual data about a person: name, perhaps address and locators, maybe certain other identifiers such as assigned numbers (e.g., social security number, etc.). It can manifest itself in various media but is in its essence intangible. Information in its purest form is hard to put a rope on.

Of course there are ways to lasso information and tie it down: patents; copyrights; locked rooms, closets, cabinets, and folders; encryption and ciphers; and I'm sure there are countless other ways to take data and information (in tangible form of some sort) and hide it away. But information is not what appears in tangible form -- such as on a plastic card or in a report. It is the knowledge of that data in its proper and meaningful context. To briefly digress, the value of information is in what knowledge of it lets one do. If nothing can or is done with the knowledge derived from the information created out of the data, there is no point in having it: it is worthless. It becomes trivia (which has its own value at parties with a lot of nerds and wonks). In short, I think it is hard to apply mechanics, in this case the definitions of "private," that work for tangible things to intangibles such as information.

The OED's definition for "privacy" is at first blush more specific about why "secondary marketing" would justifiably be considered an invasion of privacy. It reads:

1 a the state of being private and undisturbed. b a person's right to this.
2 freedom from intrusion or public attention.
3 avoidance of publicity.

Even I can see how this alone could have directed the Privacy Commissioner: especially definition 2. My question is whether it's reasonable. Deconstructing:

• Let's assume that marketing and other communications that cause apoplexies among the citizenry (privacy zealots) have precious little to do with publicity making definition 3 irrelevant.
• The second definition appears to derive from the first and, in my view, speaks more to issues of trespass than to communication. This is a little hard to abstract, but think of the difference between someone looking across your open yard at what you are doing on your property as opposed to someone who has opened the fence gate and intruded to have a gander. There are nuances in this distinction that limited space (and my lack of desire) makes hard to explore much further: our "private" space should be sacred to the extent that others ought not to be able to intrude on it to observe and gain knowledge about us.
• The first definition is quite clear on privacy being the right to a state of being private and undisturbed. "Undisturbed" is effectively equivalent to "intrusion" in the 2nd definition, which is to say that it refers to not being actively intruded upon when in one's "private" state. I'm going to ignore it, having dealt with it above. This leads us back to "private." ("Ahh, now it makes sense why you chose the underlying word first, Mr. Moto.")
  As this notion of privacy relates to information privacy (personal or otherwise), it implies that information is a tangible "thing" to which the mechanics of removal and seclusion from others' prying eyes can be applied. And, I think we've dealt with that to a pretty fair extent as well.
  Did anyone else notice that although "private" appears to be applicable to "objects" like information, "privacy" seems only to refer to the concept of a person being left alone? For there to be "information privacy," that information must be a subject or actor in its own right to be left alone. Otherwise, I think it has to revert to the concept of "private information protection." Interesting . . .

Now, to round out the discussion, what about this notion of a "right" to information or, in shallower terms, "ownership" of information? I raise this because it is explicit in the idea of private and implicit in that of privacy that the "thing" is "belonging to an individual; one’s own." I’ve written about it before, as have many others. There is little consensus on who "owns" information and much philosophical hand-wringing. Suffice it to say that unless you own something it's hard to justify it being private (Highly applicable to your shopping habit information in the hands of the retail store: is it yours or theirs?). I'm copping out now by leaving this thought hanging without further support: I'm tired and want to get to the climax.

The point of this entire pedantic diatribe is that I think the language -- the vocabulary --we're using to create and discuss digital identity is a holdover from a different time and place. While it is valid and necessary to some degree during this transitional period because it creates a shorthand for getting to ideas and provides essential continuity with the past, the baggage that this vocabulary brings with it is weighing down and impeding effective discussion about what is and where it's going. In this case, we're applying 17th or 18th-century definitions of private and privacy in a 21st-century world.

Some people like the old vocabularies: they're comfortable and easy. New vocabularies are hard work and cause tremors of their own accord. Some would suggest it is more important to focus on the practical issue at hand than with the pissy notion of the vocabulary by which we discuss these issues. Others -- like the Cluetrainers and Kim Cameron, even Dick Hardt -- are busy dealing with changing the language. Is "identity meta-system" an appropriate word or description? Maybe, maybe not. Doesn't really matter. What matters is that the word is (sort of) new and the opportunities for it are endless.

Tamagotchi - the toy that plays with your children

I know I'm way behind on this because these little things have been out for seven or eight years. But there is apparently a craze among kids here these days and my daughter just succeeded in obtaining a tamagotchi via her grandmother.

Typically we play with our toys and always have. We initiate and control the "when" of playing with our time-wasters. (Of course there are many games and toys that have timing as part of their point and purpose. But even with these it's a limited, finite period of game play.) Not so with the tamagotchi. Once started, the little electronic "alien" life is born and then continues to grow through to adulthood before it "leaves" for its home. During it's life here in your son's or daughter's hands, it demands varying levels of care in the form of feeding, cleaning, praise, discipline . . . It chooses it's times -- not when it's convenient to play, but during homework, dinner, bath and so forth. To that point, the silly thing woke me up at 3:00AM chirping away because it needed cleaning or food or some such. (It ended up under a few cushions in another room; I hope it's not scarred.)

My point, to end this post, is that I'm fascinated by the toy. I find it amazing that the Japanese managed to find a toy that plays with children. That is, the toy is now directing the how and the when. What's the long-term effect of THAT?

I guess I just don't understand Privacy

Michael Geist, law professor, columnist, and proclaimed guru of all things Internet, has weighed in on the Canadian Privacy Commissioner's recent finding that inclusion of marketing materials in a statement to a client/customer constitutes "secondary marketing" and is a privacy breach. The client/customer must have the ability to opt-out from receiving the intrusive extra paper. The Toronto Star column, the link to which will likely disappear soon, is at: Building privacy culture from the ground up.

I understand the all-permeating opt-out zeitgeist. It stands in accord with the basic citizen's -- or even human -- right and freedom to choose whether, how, and when anyone -- not exclusively, but especially commercial businesses -- may communicate with an individual. It is a wickedly individualistic imperative that in many instances allows for and encourages an individual to extricate herself from the group (the market, the customer base, the social network, etc.). But that's another matter. Suffice it to say that the Commissioner's decree that opt-out is required makes sense within the environment of the day.

What makes less sense is what comes of that foundational premise. First, the Commissioner and Geist take the position that these "secondary marketing" materials are an unauthorized use of customers' personal information. Interesting. With reference to the online practice of ensuring opt-out from mailings of "other interesting and valuable information from associated companies," I see the consistency. I, a customer, did not specifically allow you, the business, to send me any information beyond that which relates directly to the service you are providing. OK. But what does that have to do with privacy?

The bank under scrutiny notes that it bulk mails such enclosures to all its customers with their regular statements. The mailings are apparently not individuated and personalized by customer. Moreover, the envelope is a means to convey an essential element in the provision of the service: the statement. That it also affords a fabulous, paid channel to the individual for added messaging is a bonus not especially different than having sponsor's signs painted on hockey rink boards, commercials on television, ads in magazines, or . . . Yes, no doubt, the paper that is received inside the envelope, inside my house, is much more insidiously annoying and difficult to block out like those other ads. Yes, they are inside my house and therefore have breached my territory (without my desire or approval). All true. So what?

If the material was sent, albeit directly addressed to an individual because of the statement that had to be provided as an essential aspect of the service for which the customer "opted-in," without any regard for who specifically it was being sent to, without any delimitation on the individual target's profile beyond being a member of a particular group (the bank's customer), without personalization or customization that would render it a more potent and effective solicitation, what's the harm? That it was addressed to a person by name? Secondary marketing materials are ever so slightly more of a nuisance than primary marketing materials. But unless the bank -- in this case -- provides the means for follow up by the marketer (a phone number or the address of the customer so that the secondary marketer can pursue a solicitation), given that the customer was not selected for personalized communication based on personal data and information, it is only a nuisance. To deem it to be an invasion of one's privacy stretches the bounds of what constitutes privacy of information.

Let's presume that the bank: merely included an item of marketing material inside the envelope to its customer; neither customized the targeting (i.e., everyone got the same paper) nor divulged the name, address, or other information about any customer to the secondary marketer that paid for the medium (i.e., the space in the envelope). If so, there was no solicitation made based on uniquely identifying personal information nor was the personal information distributed to any other party. Nothing was taken from the customer but a little bit of effort to sift through yet ignore the envelope clutter. How is this an invasion of privacy?

To be an invasion of one's privacy presumes that all communication and contact with a person has to be approved by the recipient. The logical extent of this is that there can be no communication because the initial mover is prevented from moving. That logical extent is, of course, ridiculous. But what it does present is bold relief of the inherently unworkable nature of a "privacy culture" that extends the definition of privacy in this excessive, individual-centric way.

Instead, it may be of greater long term value to restrict the definition of "privacy" to the inhibiting of any activity: that distributes or makes use of personal information to customize and personalize solicitation/communication; that distributes without the subject's approval any of that subject's personal and personally identifying information; that uses access to a subject and that subject's personal information to take away from the subject additional knowledge of it or other such of its intangible property(ies). That would be consistent with an invasion of privacy whereby somebody learns/sees/hears something that they shouldn't; somebody accesses something that is protected.

I can't stop people from yelling at me, but I can stop listening. I can't stop people from looking at me, but I can draw the blinds. I can't stop people from eavesdropping on my conversations, but I can hold those conversations out of their earshot. It makes little difference if I get more junk mail -- even inside my mail -- because I can ignore it.

Here's why it's often hard to not "profile"

This sort of thing makes me crazy mostly because it raises the human "reptilian" response function of my brain into high alert. You'll see why it makes me think of the ambiguity that pushes field operators in spy organizations to often shoot friendlies: when you don't know for sure who's friendly, everyone's an enemy.

A story in the Globe & Mail covers some dialogue between Canadian national security personnel, from Deputy Prime Minister through CSIS (spies), and an Imam in Toronto: Imam warns Ottawa to back off Muslims. The lead:

A controversial Toronto imam warned Public Safety Minister Anne McLellan at a closed-door meeting to stop "terrorizing" Canadian Muslims.

The irony of the statement exceeds even my ability to balance reality with surreality. More than that though, the story's next paragraph lays out a threat by this so-called "radical" religious man against the nation:

"If you try to cross the line I can't guarantee what is going to happen. Our young people, we can't control," Aly Hindy, the head of Scarborough's Salaheddin Islamic Centre, recalls telling the minister at the May meeting she held in Toronto with dozens of Muslim leaders.

Wow. That sounds like a (not so veiled) threat to me, laid off by the "leader" with a plaintive "it's so bad, we can't control . . ." So everyone in the government is being nice (read the rest of the article) and bending over backward not to overreact by calling this threat what it is; to not paint any or all Muslims with a brush that could be construed as "stereotyping;" to not even issue a response to this particular man by calling him out as making sedicious threats implying terrorism toward the nation. The whole thing is bizarre. As I recall, the White Russian dukubohrs (sp?) were put down quickly. Various ethnic immigrant groups through the early part of the century were interred and later stripped of their connections to their culture, families, etc., etc. simply because they belonged to a racial or ethnic group with which the country was at war. They themselves did nothing, made no threats, demanded no special treatment . . .

What's wrong with this picture? The entire issue is well beyond my ability to address it, lay blame (if any is to be laid), or assess a response. But, if a community within the country says it has no control over itself BUT -- and here's the big but -- follow our demands and not exert any control over us (or those in our community who we can't control) then what must a nation do to protect its house? I try to be pretty broad-minded and take people for who they are. But I also know that there's a really good likelihood that one tends to be like those one spends time with -- whoever that is.

Given all the recent events, imagine the combustability of the situation in the USA, in Britain, in Australia, and Israel.

Not on vacation -- yet

As much as it may seem like it already, this Site is not on summer vacation . . . yet. It's just that there's been nothing to motivate clicking on the keyboard for the past couple days. At least nothing for this Site . . . yet. Having said all that, we will be closing until the 25th of July.

"Porcelain" communications from .mobi

Esoteric title in reference to this Guardian article describing the activity to create a mobile-only TLD (.mobi): Consortium to start releasing mobile-only internet addresses. Interesting stuff. The consortium includes Microsoft, Ericsson, Nokia, T-Mobile, Vodafone . . . and a few other comparable "lightweight players." All speaks to further settlement of the mobile option for communications.

More interesting, and buried at the back of the article, is the following snip:

The news comes as another long-awaited mobile service is to finally get the green light. MobileATM, a 50-50 joint venture between IT firm Morse and the LINK cashpoint network, announces plans today to introduce mobile banking by the end of the year.

MobileATM has spent the last two years developing a simple to use service which effectively turns a mobile phone into a cashpoint machine. Although a mobile phone cannot dispense £10 notes, customers can check their bank balance and top-up pre-pay phones from their bank account through the service, by using their PIN.

The Revenge of Geography

What follows is a final draft of a paper I've been working on. Comments welcome.

One original promise of the Internet was that it would render location irrelevant. That, of course, is bunk. It's true that in these early days for the Internet, the ground remains unsettled and could change tomorrow. Be that as it may, one thing can never be overlooked: Ultimately we are physical beings with physical needs. While some of our needs and desires can be made digital, most of the important ones can not. And so geography rears its head and puts the lie to great plans and forces rethinking about opportunities.

The most seductive business models of the Internet age (so far) are built on a pillar of geographic independence. Amazon, eBay, Expedia, and iTunes, by way of example, have each succeeded with an implied freedom from the bonds of geography. Tom Friedman makes the case in his latest book, The World is Flat, that globalization (not strictly but substantially equivalent to "geographic independence") has been richly enhanced by the Internet. He and others point to how the Internet has provided the structure for knowledge service providers with greater intelligence, more ambition, and lower-cost environments to succeed at servicing Western needs without geographic proximity. Fair enough. In some ways the Internet has leveled geographic inhibitors. But over-generalizing to represent proof that the Internet frees us from geography is simply wrong.

This paper is not about globalization, the forces for which go well beyond communications media. Rather, it's a perspective on why and how geography continues to matter in significant ways -- even to those bellwether businesses of the new age.

Seductive 'virtual' businesses

eBay

eBay is about as digital a version of the real thing -- a marketplace -- as could be created. The business simply administers and facilitates -- for a fee -- the buying and selling of any good and service among everyone and anyone. Although co-opted by independent vendors rather than simple traders, eBay remains an open marketplace where the right item for someone and a good reputation count.

eBay probably would not be any measure as large were it restricted to the same small geographic market area upon which a flea market relies. Because sellers and buyers reside at the end of any Internet connection, eBay can host an enormous volume of commerce involving items for which there is no significant local market. It's axiomatic that the likelihood of a buyer and seller finding each other diminishes as a market space is constrained. But widely separated, unknown people with the same interest in some thing find each other on eBay.

Amazon.com

Everyone knows Amazon's story: extremely well funded, long time to profitability, survived severe skepticism, now making increasingly profitable sales everywhere -- the primary source for just about everything, not just books. No doubt many features like the intelligent recommendation engine make Amazon a great experience and increase its popularity. But its unmatched array of product makes it the most likely source of any item, and its accessibility from anywhere at any time are critical.

Amazon's rich product assortment is feasible only because it holds inventory at and processes transactions from distribution centres at a cost lower than any retail store. More significantly, it can even hold esoteric items for which the market in its service area (arguably the world) is severely restricted. So Amazon is the first source for popular and unusual merchandise because it operates in a relevant market: one that is substantial and efficiently serviceable. And for a substantial part of its business, Amazon has no relevant competition. Somewhere between 30 - 50% of Amazon’s sales are of merchandise that the average bricks 'n mortar big box bookstore doesn't even carry. Traditional retailers won't typically stock such product because there is no local market to buy it in a reasonable amount of time.

iTunes

iTunes is distinct from other digital vendors in that it doesn't even have the burden of unique transactions that the others shoulder. Where a travel reservation on Expedia is subject to a fixed inventory and requires a unique document number, or a book sold on Amazon is a unique "thing" to be delivered, iTunes is liberated from these constraints. Its products can be resold forever with impunity: once rights have been obtained and the audio digitized, that's it. There is never again any inventory acquisition, replenishment, or processing required. Each new customer simply downloads a copy without affecting the original.

iTunes sells current hits in substantially greater volume than the old and the unusual. But, one should expect that iTunes probably generates a significant portion of revenue from music that retail and mail-order music stores/services simply can't offer. Chris Anderson and Joe Krauss point out that iTunes has a library of well over one-million pieces of music and each one has been bought at least once. It's nearly a perfect model: unrestricted practical market breadth, unlimited supply, and effectively no marginal cost to distribute.

The 'long tail'

If you've missed this de rigeur buzzword: Welcome back to the planet. Though a relatively old concept, thanks largely to Clay Shirky, Krauss (from whom I borrowed the following chart), Anderson, and a host of popular publications, it's everywhere today. The 'long tail' is one of the recent explanations for the success (so far) of the seductive business models above. Anderson recently popularized the concept with an editorial in Wired, the magazine of which he is editor-in-chief, and a popular blog.

So what is this 'long tail' thing? As shown below, it is the overlooked part of the oft-forgotten 'power curve' distribution. This curve graphically represents the most common rank distribution in nature where there is uninhibited selection opportunity from a large universe of options. Whether the subject matter is individual wealth, structure of firm sizes in an economy, popularity of search terms or blogs, or through-put capacity of power-stations, the distribution invariably follows this pattern.

The power curve's essence is that in any population set there will be a very few who's riches is orders of magnitude larger than even the next largest member of the population. The measured value steeply diminishes rapidly and asymptotes from near vertical to practically horizontal. The 'long tail' refers to the unending horizontal line and the idea that while one member is definitely in first place, there is typically no end because the volume of small, undistinguished members of the population massively outnumbers the very rich few at the front end. For every Bill Gates there are a hundred million Joe Nobodys.

In the graph above, the data for which comes from Joe Krauss's accounting for a query distribution sampling at Excite in the late 1990s, the head and tail have been highlighted. What the graph represents is the order of magnitude discrepancy between the most-sought terms and the others. "Sex," the most popular term, was 100,000 times more popular than the 1,000th most popular term.

The numbers driving commercial exuberance for 'long tail' businesses are the percentages attributed to the head (3%) and the tail (97%). What's got everyone so excited is that they show in extreme relief what the businesses described above are experiencing to certain degrees. The head of the curve has the few winners, but the vast majority of members and volume in the market -- in this case all but a few percent of the total -- is in the tail. Logically, if a business has the features of those we've described:

limited market breadth

uninhibited supply

competitively lower cost to serve

why would it focus only on the popular? Why target only large, homogenous markets? Why carry and sell only the "hits?" It's counter-intuitive and fed by these few apparent successes and the data from absolutely constraint-free examples such as search terms.

Geography wags the 'long tail'

There is, of course, an enormous difference between the 'long tail' -- part of a rank distribution -- and a viable business exploiting the market(s) represented by a perceived 'long tail.' It may turn out the 'long tail' notion becomes as abused and discredited as the 'first-mover' share-grab strategy. The subtleties and distinctions to be worked out -- probably through high-profile failure -- are presently being overlooked in the exuberance to make this concept fit the purpose at hand. The first force that's been conveniently discounted is geography.

What the seductive businesses should illuminate are certain conditions for bridging the gap between the 'long tail' as a distribution construct and a valid business. At least four geography-based conditions alone exist for successful transition from 'long-tail market(s)' to 'long-tail business.'

1. Product must be non-perishable. A fundamental characteristic of the 'long tail' is patience. While it ought to afford high overall volume, generated in small bits from a very broad base of customers, business in the 'long tail' is precisely the opposite of that at the head of the curve. Each item may take ages to move; inventory turnover could be well outside normal business levels. That could be a problem if the products offered have a limited shelf life. Non-perishability is critical in another way. In the seductive business models, the inventory of product is ideally infinite: a sale on iTunes does not create a replenishment need; eBay leaves inventory fluidly in the hands of sellers; a book can wait in a cheap warehouse -- as opposed to dear retail space -- to be sold by Amazon.

2. Cost to hold additional inventory and process more orders must be truly marginal. Enough said. Without access and capacity to hold vast amounts of product at a competitive cost advantage, it's not worth it. In addition, the cost to process a transaction must be favourable. This includes not merely electronic v. physical checkout but credit card processing fees, system costs, logistics, and so forth. Just as the revenues for 'long tail' businesses would come from selling ones of many rather than many of one product, so too will its cost structure be inverted relative to traditional businesses. Amazon and iTunes, for instance, appear to have achieved mastery of inventory and ordering processes and costs as compared to the traditional geography-bound alternatives. One could speculate that at some point though, that will not be enough.

3. Distribution costs specifically must be limited or off-loaded. Amazon, like catalogue retailers, charges the buyer for delivery. With eBay an agreement is made between buyer and seller as to who will pay the shipping cost. iTunes's delivery cost is bandwidth, which is (a) trapped within baseline infrastructure overhead and (b) gets more cost-effective with increasing volume. (Some traditional retailers, such as REI, have begun to use their retail locations as 'warehouses' and 'shipping destinations' for online orders. The seductive businesses thus externalize one of the principal barriers to distributed-market business models: moving the merchandise -- even the digital sort. Businesses that can't offload this critical cost -- and they are the majority -- will have difficulty benefiting from the 'long tail' model or the Internet in the obvious ways.

4. Legal jurisdictions are geographically-defined: accommodate borders. Despite globalization and regionalization in the form of partnerships and trading blocks or unions, the world is and probably will be politically defined by nation-states. Each nation will persist in asserting its sovereignty with unique, controlled legal systems. In theory the magic of the 'long tail' (especially) Internet-based business models is the absence of boundaries, including geo-political ones. In practice though, the geo-political realities of currency differences, taxes and duties, customs clearance time and fees, and so on are immediately visible beside shipping costs. Hidden just below the surface are more sinister legal issues like, well . . . legality. Consider:

"As the eBay community expands around the globe, we are encountering different laws and different points of view as to what constitutes illegal, offensive or inappropriate items," said Mike Jacobson, eBay General Counsel. "Given our expansion, as well as feedback we've received from our users, we reviewed our policy and concluded that these changes are appropriate."

eBay is not the only auction site to suffer from public ire raised over the trade in Nazi-related items. Yahoo!'s Yahoo Auction site was sued in a French court over "alleged justification of war crimes."

This was the global response from two large, 'geography-independent' online businesses to the public outcry and subsequent legal proceedings in one jurisdiction. Then there's iTunes. This truly global business (i.e., the music and its form is globally acceptable without structural obstruction) is trapped by borders. Its geographic challenge is that copyright and licensing laws for its product (music) are different by nation. That is the primary reason why the iTunes music store was unavailable in Canada for nearly two years after it launched on the south side of the 49th parallel.

Here's the rub: Most businesses, even the most seductive of 'long tail' Internet business models, do not satisfy these criteria sufficiently to render them truly geography-independent. Not only must there be sufficient value in the business proposition to overcome the constraints of space, but at a minimum the operating model has to accept and account for, not avoid, the impositions of geography.

Before business planning oneself into a virtual or 'long tail' model -- for the sake of investor, fad, or fashion -- make sure the basic business principles work. And, like one of my History professors would say, "Always go back to the geography."

Electrifying option for getting online

We've known this was coming for a while: not specifically the forthcoming announcement by IBM and CenterPoint Energy, but the development of broadband over the electric grid as noted in this Toronto Star article today: IBM to test broadband over electric power lines. A snip:

By relying on the adapters -- which currently cost about $200 but are expected to become less expensive -- utilities do not need to send a worker to install equipment. Consumers can use the adapters in any room with an outlet.

The U.S. Federal Communications Commission is backing the development of this technology in hopes of creating a counterweight to the cable and phone industries, which provide the bulk of the 36 million broadband lines now being used in American homes.

The service could also be cheaply deployed in rural areas where phone and cable companies have not yet expanded.

Where to start with impact assessment? The telcos and cable co's? Broadband access and last-mile connectivity? Affect on eCommerce at the consumer level? What about Internet governance (which as this and this attest, is a very hot topic around the UN and ICANN).

We will watch closely.

Running on 'scared'

Is it synchronicity or an example of the phenomemon that you see what you're looking for? I've been harping lately on the broad lack of courage in the places one might expect it: coporate boardrooms, policy offices, courts, presidential suites and so on. My whinging has been supported by a book I'm reading right now entitled, The Timid Corporation. It's an interesting book with an interesting premise/thesis, although I'm not sure I agree with the route it takes to get to its point nor with the almost corporatist apologist paean undercurrent in the writing. Be that as it may, the book is some 225 pages worth of expose about the increased timidity and lack of courage, and, as the author puts it, "defensiveness" that prevails.

So what? I'm seeing this "meme," as it were, appear regularly in various places. It's getting to be almost as prevalent in commentary is is "the long tail." Here, for example, is a story from the Globe & Mail that addresses the thoughts of a former chief economist at the IMF viz. the pathology of fear in the economy: World economic crisis looming. A snip:

The former chief economist of the International Monetary Fund, Kenneth Rogoff, worries that we may be living with a pathology of fear" which is holding down long-term interest rates and covering up a number of serious economic problems in the global economy.

Back to the original question: is this theme more prevalent or am I just seeing what interests me?

There's money in online crime: professional criminals involved. Story at six.

Three stories in two days in two of Canada's largest newspapers. Jist of it is -- are you sitting? -- online crime such as identity theft is being perpetrated by . . . professional, organized criminals. Shock!! Horror!! Thank God the media's all over McAfee's study (referred to in the stories).

First, the Toronto Star: Cybercrime follows the money, study says. That was yesterday, I think. Along with a story about how much money there is in online crime from the Globe and Mail ('Hunting season' for computer attackers). Now today the Globe & Mail has a follow-up piece: Internet crime getting stealthy, more harmful. The lead:

Spotty teenage hackers who set off global e-mail viruses are being replaced by serious on-line crooks whose stealth attacks don't make the headlines but cause more damage, security software makers warn.

Tim Horton's . . . choice of everyone

What a bizarre line of discussion going on in the media world, and presumably in the boardroom at Tim Horton's corporate headquarters. Human waste (a.k.a. Karla Homolka) gets out of jail after a long visit and goes immediately to . . . a television studio. In an exclusive interview, she admits that her heart's desire is to go out right after her media performance and get an iced cappuccino at Tim Horton's. Now there appears to be interest and hand-wringing about whether this undesired endorsement is good or bad; how to react; etc. (Globe & Mail story here: Ice-coffee craving gets cool reception.) From the story, by way of example:

Faced with the stamp of approval of a reviled criminal, the popular coffee-and-doughnut chain took pains yesterday to distance itself from Ms. Homolka. [Emphasis mine]

Really? Can anybody imagine that Tim Horton's is any more or any less because somebody says they want a particular beverage? Well . . . I suppose that would be the logical outcome for anyone convinced in the power of celebrity endorsement. No matter how silly.

Does anybody have any idea whether Bernie Goetz preferred Pepsi or Coke?

Something REALLLY wrong is going on here . . .

The title came to me prior to recognizing that it's a reflection of Al Pacino's famous bellow in ...And Justice For All. Now the irony is settling in. In any event, these two paragraphs from the Globe & Mail story: Homolka enlists 6 lawyers for case answer a question that's been floating around my house for days as we are bombarded with news reporting about ". . . Homolka's lawyer . . ."

With a brief appearance at the Joliette courthouse yesterday to begin the appeal process on her release conditions, Ms. Homolka's lawyers now number six.

Three of them are permanent legal-aid lawyers and it is possible the others are also paid by the state.

Unbelievable. Isn't she a private, free citizen now with all the rights thereto appertaining, including being screwed if she can't afford a lawyer to pursue her quest to erase all she's done?

WiFi killed the radio star

Saw the story in the Inquirer, but followed the link to Independent Online in South Africa carrying this story: New broadband 'whispers' below the radar. Sounds very cool to me; although now I'll need another piece of hardware:

xMax, the latest innovation in broadband communications, is a very quiet radio system that uses radio channels already filled up with noisy pager or TV signals, said inventor Joe Bobier.

"xMax is trespassing radio frequencies, although trespassing is not the right word, because we're allowed to transmit a signal if it doesn't interfere with other, stronger signals," said Bobier.

The technology could interest a telecoms or Internet operator with no radio spectrum
What is unique about the system is that it can emit signals that are too weak to be picked up by normal antennas, but that can be "heard" by special aerials which know where to "listen", thus enabling dual usage of the same scarce radio spectrum.

Nobody's using all those FM frequencies anyway -- just the oldies stations that are going satellite anyway.

Live8 embarrassment

I watched a little bit of Live8. The spectacle was, well, spectacular: a testament to logistics and public relations. [It's hard not to be just a little cynical about the touring artists who's contribution garnered vast world-wide viewership . . .] I hope that it produces some progress toward its goals although I suspect that the issues being targeted are part of a complex web of high finance and international politics: not simple stuff. The television commercial is powerful. All good.

What I think was an "embarrassment" was, as a Canadian, having Tom Green represent Canada as one of the co-hosts of the Canadian show from that world-known metropolis of Barrie. Green did his very best to prove that he is a bumbling, poorly-spoken, intellectually retrograde, obnoxious buffoon with almost no awareness of what might pass as good taste for what could have been a global audience. [Well, who's kidding whom? The Canadian show may have got worldwide audience when Celine did her bit. Which brings me to my second point of embarrassment.]

Celine Dion is easy to make fun of because she's kind of corny and cheesy. The music she makes doesn't really run to my taste. In short, I can live without her. But, I would never -- for a global audience, again -- outright boo and jeer the woman's performance during a show like Saturday's. That's what the 40,000 in Barrie did though. Rather than have an internal conversation and say, "I don't care for her much, but she IS a Canadian doing the Canadian show when the Americans from Philly would gladly have promoted her as one of their own from LAS VEGAS, and she is arguably one of the top three female artists in the world, and she's brought an audience from Las Vegas into the programme, and she's doing the Live8 performance as a matinee on the same day she does her regular show, and did I mention she's Canadian . . . Suck it up and cheer for her.

"It's about 'inter-dependence' said the hosts of the program. Not in Canada.