If you are an investor in or user of telephony, you might be interested in this web page describing how the Internet is undermining the established providers of telecommunication services. An excerpt is included below (warning — it requires some knowledge of technology).
The Paradox of the Best Network comes about because as a network gets stupider, connectivity becomes a commodity. Those who own and operate the network have less to charge for. After all, they’re just moving bits. The high-value services, the ones that command premium prices, reside at the edge of the best network. Because the best network is simple, it is low-cost to operate. In a competitive market, this means it is low priced. Low price also lowers barriers to innovation at the edges of the best network.
The telephone companies are impaled on the horns of this dilemma. Historically, their high-margin services have been built into the middle of their network, which has been optimized for a single application — voice. Their business is based on this special-purpose network. They know that implementing the new commodity network threatens the very basis of their business.
In contrast, the Internet is not optimized for any specific application. Its strength is its generality. It’s designed simply to move bits across all kinds of wired and wireless infrastructures. As a result of this simplicity, the Internet has proven to be the most scalable, most robust communications infrastructure humans have ever built. It has proven itself effective at encouraging innovation: of all the winning networked applications of the last decade — email, web browsing, instant messaging, chat, music sharing, streaming audio, ecommerce, etc. — every one appeared on the Internet. Not one was invented by a telephone company. And not one needed any special mechanism within the network itself
This fact frightens the telephone companies. It should. The Internet’s bits-are-bits simplicity even threatens to turn their cash cow — voice telephony — into something anyone can do just by installing simple software onto an everyday PC. Hook a PC to a high-bandwidth, always-on connection and anyone can make high-quality Internet phone calls without telephone company involvement. Further, innovations like document sharing, collaborative whiteboarding, and add-on video conferencing, which are difficult on the old telephone network, are relatively easy additions to an Internet telephony program. Because the Internet is a commodity network, Internet telephony is cheaper. Because it’s a stupid network, innovation is easier. Further, the value is added at the edge of the network, outside of telephone company purview.
But, the real threat to the incumbent telephone companies isn’t the Internet. It’s the Paradox of the Best Network. The paradox means that companies that run the old, closed, special-purpose telephone network have an unfit business model for running the new network. No amount of technological upgrading will fix this. To survive, the incumbents must become different businesses. But there’s no guarantee that they’ll be the best companies to run the best network.
Link The Paradox of the Best Network
The Chinese government is threatened by free speech. It doesn’t tolerate criticism and freedom of expression (just like business partner Wal-Mart). Michael Moore would be a skinny prison inmate if he lived in China.
A Chinese court recently announced that a democracy advocate who had used the Internet and was charged with subversion would receive a suspended sentence instead of a long prison term.
The case had drawn criticism from human rights groups and served as a rallying cry for this country’s rapidly growing number of online commentators. Both in China and abroad, some commentators quickly applauded what seemed like an official show of leniency toward the accused man, Du Daobin, a prolific author of online essays on issues of democracy and free speech.
But many among China’s Internet commentators are warning that what appears to be government magnanimity in this high-profile case conceals a quiet but concerted push to tighten controls of the Internet and surveillance of its users. China’s restrictions on the medium are already among the broadest and most invasive anywhere.
Link China’s Web Police Send Mixed Message
Below are some excerpts from a letter posted on the web to George Bush from Joseph George Caldwell, who spent much of his career working in military systems analysis and served as director of research and development at the US Army Electronic Proving Ground’s Electromagnetic Environmental Test Facility. He has conducted much research in the area of strategic planning and analysis and maintains a popular Internet website (www.foundationwebsite.org) on strategy, politics, and warfare.
My proposal is this: Divide (balkanize) the country into three parts – three countries: one for the Kurds (“Kurdistan”), one for the Sunnis (“Sunnistan”) and one for the Shiites / Shias (“Shiastan”). Relocate people as required to create a homogeneous population within each country (as was done, e.g., in Cyprus and in India/Pakistan several decades ago and in a number of countries in North and South America a few hundred years ago). In each country, place a powerful and respected family in charge. Each family will be responsible for running its country in an orderly fashion. Each family will be beholden to the US for its position. The requirement for continued US support will be the development of its oil resources, and trade oil with the outside world. If it does not comply with this requirement, it will be replaced.
As currently constituted, and under current circumstances, Iraq is not governable. There is not, as is so often referred to in the press, an “Iraqi people.” There are basically three Iraqi peoples – the Kurds, the Sunnis, and the Shias. My proposal recognizes this fact. A strong nation is comprised of a population that is highly homogeneous with respect to basic human attributes, such as language, religion, race, geography and culture. Profound differences in ethnicity and religion are currently tearing Iraq apart. As three separate nations, stability, order and peace will return. I know that diversity is important to you, and trying to minimize diversity by forcing a single nation instead of three diverse ones is very much counter to the goal of promoting diversity.
I know that you have expressed a desire to install democracy in Iraq. Unfortunately, Iraq is not ready for democracy. Iraq’s religion, politics, and culture are hundreds of years behind the West. Cultures cannot be changed very fast – recall the fate of Shah Reza Pahlavi of Iran, who tried to “westernize” that country too fast. Democracy is not very important to current Iraqi peoples. What is very important to them at the present time is self-determination. And there are three major subpopulations, each of which wishes to be independent of the others. It took the West a thousand years to evolve its current democratic institutions from those of the Middle Ages. Expecting Iraq to move from its Middle-Age culture overnight is unrealistic.
The solution that I am proposing is not original with me. It was proposed hundreds of years ago by Machiavelli – and thousands of years ago by Sun Tzu. It is based on sound and tested principles of politics and warfare. The current approach of trying to impose an alien culture (democracy) overnight in Iraq, and govern radically different and inimical populations by means of democracy, is doomed to failure.
Link How to End the War in Iraq
Below are some excerpts from an article by Jonathan Rauch, who says that Reagan missed greatness, but nailed rightness.
Reagan would chuckle to hear me acknowledge that he was smart. He understood all along that liberals’ intellectual snobbery was his best friend—something the liberal intellectuals did not grasp then and, for the most part, still don’t grasp now. Bested time and again by Reagan, they might have reconsidered their contempt for him, but instead they chose to turn their contempt on a public dumb enough to be taken in by him. Today, Michael Moore and his legions give President Bush (Yale B.A., Harvard M.B.A.) the same treatment (“Stupid White Men”), with exactly the same result. Liberal condescension is the reason the country adopts so many liberal policies while electing so few liberals.
Reagan might, though, have been genuinely pleased to hear me say not just that he was smart but that he was right. At least, he was right where it mattered most.
So Reagan did more than I had ever imagined a president could do to beat Communism, douse inflation, empower markets, and even—ironically—rebuild public confidence in the federal government he so mistrusted. To which can be added, less momentously but still significantly, pulling off the audacious and elegant bipartisan tax reform of 1986. Quite a record.
He was not, however, a great president, because he had a squalid side. The Teflon president, people called him, because bad news never seemed to stick. Bad news didn’t stick, because Reagan, when confronted with it, could act with breathtaking irresponsibility.
And then there was Lebanon, the least remembered but perhaps, from today’s vantage point, most costly of Reagan’s shrugs. In his first term, Reagan committed American forces to a fuzzily defined peacekeeping mission in Lebanon, where there was no peace to keep. Again and again, he swore that the United States had a vital interest in Lebanon and would not “cut and run,” even after a suicide truck bomber (does that sound familiar?) killed 241 U.S. marines. On February 4, 1984, Reagan said, “If we do [cut and run], we’ll be sending one signal to terrorists everywhere: They can gain by waging war against innocent people.” And then, only a few days later, Reagan skedaddled, insisting lamely that he was merely redeploying the marines—on ships, offshore, floating away. No one was fooled. The signal he sent to terrorists and insurgents was exactly the one he foretold, and the country is still paying the price—in Iraq, among other places.
More important, it must also be admitted that the things Reagan did care about were very important things. And he got those right, which is impressive. More impressive still is that he got them right when the smartest people in his country had them wrong.
I had never owned any of Bruce Springsteen’s music collections until recently. I received The Essential Bruce Springsteen for Christmas — three CDs of Bruce’s best.
I always liked his hits. As I listened to these songs, I was transported back to Graduate Happy Hour at the University of Virgina in the late 1970’s. Graduate Happy Hour was supposed to be a gathering of graduates students, relaxing with a few beers, but it was really a lively outdoor party on Friday afternoons. Bruce’s songs Rosalita and Born To Run take me right back to that grassy area where draft beer was 25 cents and the parade of pretty undergraduate girls got plenty of attention. It was a great way to end the week.
International Paper has struck a deal with the U.S. Department of the Interior to conduct extensive ecological surveys and conservation projects to help recover imperiled aquatic species and restore their habitat.
The 10-year deal involves 5.5 million acres of IP’s forest lands in Tennessee, Mississippi, Arkansas, Alabama, Florida, Georgia, Louisiana, North Carolina and South Carolina.
The Interior department will assist IP in the project, which covers an area larger than the state of Massachusetts.
International Paper, which employs about 3,000 people in Memphis, is the world’s largest paper and forest products company. Businesses include printing papers, packaging, building materials, chemical products and distribution.
IP is the largest private landowner in the United States, with some 10 million acres of forest land. It is also the world’s largest seedling grower, producing more than 425 million seedlings annually.
The Southeast is the center of temperate aquatic diversity. Freshwater ecosystems there feature the highest diversity of freshwater mussels and temperate freshwater fishes in the world.
Nearly one-third of the 500 native fishes in those states are considered imperiled, and about 75% of the Southeast’s 270 species of mu
Link IP to protect species in 5.5 million-acre deal
Some positive news about the environment.
The palette of the High Plains is subtle. From the moment the sun rises in the enormous sky until the moment it sets in the mountains, the land is flooded with sunlight. As the light hits it wrings out the reds and the greens, drains even purples and oranges into submission. There is color here, but no contrast.
The valley known as Iron Creek would be no different were it not for the fence that runs down its center. The pasture on either side is as muted as the rest of Wyoming; if you saw only one of them, it would blend into the hills without remark. But here, side-by-side, the two places are like night and day.
Undeniably better looking is the east side, Jim Gould’s land. It is thick with native grasses, and the field they make is bumpy and golden. They even wave in the breeze as if consciously trying to look idyllic.
The west side is gray. Its surface is dusty dirt checkered with dried manure and big sage, the official plant of parched lands. Jim tells me that in summer the cows there poke through the barbed wire to drink from his side, for the springs on their land have gone dry. “It’s really that bad,” he says.
Jim calls himself an environmentalist. As caretaker of this land, he values the individual plants, the wildlife, and even the predators that most locals loathe. Yet if he had to choose, he’d call himself a rancher first. His family arrived at this spot in Meeteetse, Wyoming, in the 1870s, and they have raised livestock on it every year since. His work is the same as the guy’s on the west side of the fence; what’s different is how he does it.
A new way of understanding rangelands
Jim Gould practices Holistic Resource Management (HRM). (HRM is also known simply as Holistic Management, or HM.) The first word is meant less metaphysically than literally: cattlemen like Jim think of their ranches not as commodity-producing businesses but as entire ecosystems—wholes. With HRM, cows go from being the sole focus, the raison d’etre, to being tools that serve a larger system. The land does the inverse: it goes from being merely a place to grow cattle to an end in itself. HRM practitioners often call themselves grass farmers rather than cattle ranchers, but really what they are growing is nature.
It is a slow process. The changes begin as soon as you take action, but before you can do anything you must understand the concept. This takes more than reading books; it requires learning to see the land differently. All four ranchers I visited in Wyoming this spring told me it was several years between when they began studying HRM and when they actually changed their operations.
Link GRASS FARMERS: Seeing the big picture
More economic news that may help my hometown of Martinsvillve, VA.
washington—The U.S. commerce department slapped tariffs of as much as 198 per cent on imported bedroom furniture from China yesterday, a decision that could cut the $1 billion (U.S.) a year of imports and raise prices for consumers.
Most of the largest exporters of furniture will pay tariffs of 24 per cent or less, with 82 of the companies paying an 11 per cent tariff, the commerce department said in a statement.
The thousands of companies not singled out will pay the 198 per cent, and they “are going to be put out of business,” Mike Veitenheimer, a vice president for furniture retailer Bombay Co., said in an interview. Still, “the duties could have been a whole lot worse,” he said.
The case is the largest trade dispute of its kind between the United States and China, and could spark a new round of complaints by manufacturers who say business has been hurt by cheap imports from China. Bassett Furniture Industries Inc., Stanley Furniture Co. and other U.S. producers support tariffs, arguing Chinese companies are selling their products at unfair discounts, and the preliminary decision backed up their claim.
…Bedroom furniture imports from China increased 121 per cent from 2000 to 2002, and another 54 per cent in the first six months of last year. Furniture makers, such as Bassett, Stanley and Hooker Furniture Corp., say that increase threatens to put them out of business.
I hope my hometown can start recovering from the collapse of the textile industry.
DANVILLE, Va. — Virginia will build a $12 million fiber-optic network throughout its struggling manufacturing belt along the North Carolina state line to spark an economy decimated by factory layoffs.
Gov. Mark R. Warner said Friday the project will connect five cities, 20 counties and 56 industrial parks with a new communications network that will be the largest publicly funded system in the state.
“Being left off the information superhighway is just not something rural communities can afford to overcome,” Warner said.
State officials hope the project, known as Regional Backbone Initiative, will eventually create 1,500 jobs and lure $143 million in private investment to the region. It is funded with $6 million of Virginia’s share of tobacco settlement money and a $6 million federal grant.
When the network is completed in two years, a private nonprofit management agency called Mid-Atlantic Broadband Cooperative is expected to offer Internet service to businesses at a 20 percent discount.
Service providers also will be allowed to connect with the network at a reduced price in hopes that they will pass the savings along to customers, said Mid-Atlantic’s interim general manager, Tad Deriso.
Virginia’s “Southside” manufacturing region has been ravaged by thousands of factory layoffs during the past decade.
The labor market area that includes Henry and Patrick counties and the city of Martinsville had an average unemployment rate of 14 percent in 2002 and 2003, according to the Virginia Employment Commission. It jumped as high as 16 percent in July.
Community leaders see telecommunications capability as the key to jump-starting the region’s lagging economy. They believe a massive Internet network would do as much to lure companies to the region as a major interstate or airport.
Link Virginia plans to build telecom system to boost rural economy