Apple Magic Trackpad: UI Revolution ?

Posted by admin on Jul 30th, 2010
2010
Jul 30

Apple’s Magic trackpad is getting more coverage and print than a simple pointing device deserves. Takethe5th sees it as a delay in game penalty for Mac OS/X. Gizmodo, the victim of Apple’s iPhone 4 ire, sees the Magic Trackpad as a precursor to the fall/displacement  of Mac OS/X and the emergence of a new OS4-inspired OSMac  operating environ with a whole new UI experience driven by  multi-touch ; drag, swish, and drop ; other rich gestures; and context sensitive objects with flyout iconbars and menus. Gizmodo sees a problem with touchscreen with monster 27″ and larger  Apple screens being too fatiguing for the Cupertino devotee’s affinity for huge screen to manage touch screens  all day long. Hence the need for a trackpad.

Takethe5th agrees and disagrees . First, a big point of agreement – for sure there is going on right now a UI “see change”[okay, a poor pun] marked by smartphones from Apple’s iPhone and Google’s Android plus the iPad phenomenon [ soon to be followed by a wave of Android and other tablets this Fall].  Yes indeed, the old 3-5 levels deep menubar and the cryptic rows of  Mayan glyph-like toolbars will largely break up and become attached to the various objects on the screen as context sensitive menus, flyouts and a  gesture controlled UI. Instead of Image | Adjustment | Resize – pinching the object will cause a resize and leave the property bar with precise adjustment fields available if required and a bounding crawling-ant border for touch adjustments.

But Takethe5th disagrees with Gizmodo’s need for a trackpad solution because of large screen fatigue. First, the laptop with swivel screen and 16-22″ inch diagonal should satisfy the bulk of users who require gi-normous screens. But many may defect to the 10-14″ iPad or Tablet size. Also there are a number of alternative solutions including pen-light stylus + spoken commands,  finger and mouse combos,  as well as the keyboard and trackpad combo proposed by Gizmodo. In fact, Gizmodo points to a good video discussing new UI approaches:

Note that Takethe5th again disagrees with 2 critical points. Mice will not be abandoned but combined with finger operations and other direct to screen point devices while huge screens will be the creative desktop exception not the rule in computing display. Also consider the possibility of a projected display on to a close screen that increases and decreases in size as the user requires – zooming the whole screen yet leaving it conveniently close to the user and pointers.
Summary
What the MagicTrackpad and the wave of smartphones plus slates and tablets indicates is a tipping point in UI-User Interfaces in computing devices. Direct, simple, easy to use  and direct contact with the objects affected are the new paradigm. Making smart-device users immediately productive is the key. No more remote controls like for TVs translated to computer screens:

Note the page for edit is highlighted in yellow above.
Rather the new UI will be more accessible directly with touch and gesture, less encumbered with menus and toolbars,  highly context and object sensitive and thus faster to use and easier to discover/remember how to use.  This is the UI Revolution being implemented on smartphones, then iPads and tablets to be followed by a computer screen near you.
Two final observations. What company based in Redmond, Washington is desperately trying to catch up with this UI Revolution with iteration 5 on  their 4 times missed mobile phone offerings? What major IT player in Armonk, NewYork is largely on the outside looking in and barely shaping these proceedings? Now where is the center of gravity in Computing?

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Apple Shorts Touch Screen for Mac Desktops and Laptops

Posted by admin on Jul 28th, 2010
2010
Jul 28

A few moments of conciliatory silence for the legion of Apple Mac Desktop and laptop users. They will have to wait maybe for Christmas or maybe the NewYear for their multi-touch screen computers. There was no touch+gestures in the MacMini announcements this past May . Ditto again for yesterday’s iMac announcements.
This is what Mac users got – a Magic Trackpad.

Oh and Mac users got Intel’s more beefy Core  i3, Core i5, and Core  i7 CPUs – a little behind most PCs which have had them for 3-5 months, but welcome because graphics design really eats up CPU power. Not quite a touch screen and the productivity that is implied with that type of interface – no hand eye coordination required with touch screen in contrast with a mouse or even trackpad.

But there may be valid  reasons for this delay in bringing touch screens to Macs:
1)Fingers may be too fat for graphics using touch screen and the precision of a stylus or lightpen pointer may be a)incompatible with current touch screen technology or b)too expensive;
2)software vendors [including Apple itself with its Final Cut Pro, Aperture and many other graphics oriented programs] may have to make major adjustments to support touchscreen operations;

3there is a master plan for bringing touch screen + gestures to the Mac masses and that time is not now.
Whatever the reason this leaves an opening for Microsoft and Google and the thousand one tablet vendors to beat Apple on the laptop/netbook borderline. Currently, the iPad with full touch screen operations is the Apple line of defense against netbooks and laptops encroaching on it light, touch-enabled market leadership. But what if the 1001 Google Android powered tablets or a Windows 7 Touch screen land on store shelves in the Fall and in time for Christmas? Will iPad be enough to blunt this PC and smart tablet onslaught? Clearly somebody in Cupertino is a)betting that is so or b) has his own touch screen surprise up a turtleneck sleeve.

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Super Talent UltraDrive MX SSD

Posted by admin on Jul 28th, 2010
2010
Jul 28

Want to supercharge your laptop? Then do consider the Super Talent UltraDrive MX SSD. This Solid state drive comes in 60GB, 120GB, 240GB and 480GB capacities [prices not available util early September. Current 64GB UltraDrives using SATA-only are in $140 range]. The UltraDrive also has both SATA and USB ports so users can mount it internally [be sure to have a laptop expert for this task] or externally through a USB 2.0 or 3.0  port. Users may want to consider getting a USB3.0 upgrade for greater throughput. Or when upgrading a laptop , ensuring it supports USB 3.0. Disk I/O is seen to improve by a factor of 2-4 times using the external USB 3.0 connection .

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China View I:

Posted by admin on Jul 26th, 2010
2010
Jul 26

China has become the 2nd largest economy in the World today; and will become the largest if the government and people maintain there pact -”authoritarian one party rule in exchange for rapid economic development”. Takethe5th will link to articles that illuminate the progress China is making towards achieving that end. This first article originates with Marketwatch and of course deals with the economic challenges faced by China. It is very ironic that Marketwatch is calling for an often much maligned “social safety net” for China.

After an unprecedented three decades of 10% annual growth in gross domestic product (GDP), in which hundreds of millions of its people were lifted out of poverty as the country became the workshop of the world, China faces a more difficult second act.

Its government must spread the wealth beyond the great coastal cities of Beijing, Shanghai, Guangzhou, and Shenzhen to deep in the interior. It must find work for its young people while providing for a growing number of retirees. It must encourage people to spend more and save less to “rebalance” the economy away from exporting and towards domestic consumption.

How the Communist Party-run government handles this transition will determine whether it will retain the support of the Chinese people, despite its inherently undemocratic nature, and avoid the social upheavals that are the bane of all authoritarian states. It will also decide how great a power China will become. …. China needs to develop a stronger social safety net, raise incomes in the rural areas, and boost employment in the service sector. We certainly saw evidence of the latter on our trip. A growing army of hotel and restaurant workers serve tens of millions of visitors from inside China and abroad.

The safety net is key. Right now, many Chinese retire early — often with government pensions. But by 2015, there will be some 200 million Chinese aged 60 and over and a shrinking population to support them, thanks to the one-child policy instituted in 1978. With the Communist-era benefits dismantled, Chinese feel they must save more to take care of living and medical expenses in their old age.

The article provides an on-the-scene view of some of the major current economic and political issues percolating in China. Well worth the read.

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Enabling Web Encryption Easily

Posted by admin on Jul 22nd, 2010
2010
Jul 22

One of the major security problems is that data on the web often runs naked. This is due to two reasons – 1)the HTTPS protocol can be more difficult and costly to implement and 2)there is a notable performance hit to be taken in most situations. Network World is reporting work done at Stanford University that would embed encryption at the lowest TCP layer a)without incurring a large performance hit and b)without incurring huge development penalties. Well worth the intro read here at Network World and the surprisingly accessible Stanford-led original paper here. This is potentially a huge step forward in basic Web security just waiting for a Perfect Security Storm to get implemented.

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The Obama Flaw in Financial Reform

Posted by admin on Jul 21st, 2010
2010
Jul 21

The Obama team here seems so happy with delivering only what the Republicans and the Financial Lobby would allow. And that is unfortunately playing to the weaknesses in the Executive Branch that have continued through the last two presidencies -
a)a grossly poor financial management and regulatory record with a tough choice among Alan Greenspan, the SEC controlling Wall Street, Treasury Secretary Hank Paulson granting immense favors to financial favorites during the crisis and the Clinton White House dismantling bank controls for  being the worst /most blatant concessions to Wall Street financial lobby with its election bankrolling;
b)increasingly ineffectual government regulation – this is not confined to the Financial sector but can be seen at  FDA, DOE, DOD,  and many other departments and regulatory agencies which have been grossly under performing. And if you look at the Financial Regulators, there is a giant octopus of 15 agencies with overlapping responsibilities and mismatched  top level reporting authorities which creates a  huge sprawling mess when trying to regulate coherently the financial sector. And the tragedy is Treasury/Finance is not alone. There is a curious echo octopoid sprawl in the Intelligence community with another 17 agency  octopus trying to co-ordinate National Intelligence. As one pundit has noted, it will take  another 9/11 or Depression Inducing Perfect Financial Storm to provoke the President and Congress to take serious action;
c)starving the Beast guarantees ineffectual regulation and administration – for example, the 2400 page Financial Reform Legislation so joyously being  signed into law adds huge responsibilities at the Fed, SEC, and a cluster of other agencies but does not provide any budget to these agencies so they are doomed to fail.
Summary
In sum ,Yes We Can was embraced because a sufficient number of Americans wanted more executive leadership. The ability to not only work harder, act more prudently in World  and domestic affairs; but also to manage the government, its people and resources much better than it had been in the past. Clearly the Bush regime was at best a pecuniary penchant just muddling through; but just as often a covert exercise in proving that regulation and big government cant work by end running the bureaucracy and starving the agencies of support, staff and monies when they needed it the most. The Obama Flaw is that his White House Staff seem cheerfully oblivious of this need for much better management and administration of the government. Shades of a reverse Jimmy Carter.

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More on Windows Phone 7

Posted by admin on Jul 20th, 2010
2010
Jul 20

In Taketh5th’s coverage of the  Summer IT  Soap Opera, one of the most commented and controversial stories was the status of Windows Phone 7. The tech reviewers were all over the place on the July 2010  revealed developer editions of Windows Phone 7 on a Samsung smartphone. Here is the must reads to date:
Gizmodo – July 19th Windows Phone 7 Review is upbeat with caveats
Infoworld – July 15th Windows Phone 7 : Don’t bother with this disaster
ZDnet – July 18th technical preview of Windows Phone 7 – a winner come Christmas
Note these three must-reads reviews could not be more different in their conclusions
Given the importance of WP7 to Microsoft, a recent, thoughtful preview by Engadget is worth reading as well:

Here is an telling excerpt from that article:

By any measure, Microsoft’s got its back against the wall in the mobile game, and becoming competitive quickly is vital to the company’s success — and in that regard, we understand why they’ve been so adamant about getting Windows Phone 7 on shelves in time for Holiday 2010. The thing is, putting out a product that’s half-baked risks alienating early adopters at the worst possible time, especially considering that we see a clear-cut (and pretty painless) path to fixing the most egregious shortcomings. Seriously, if the WP7 team put their heads down and added a clipboard and some rudimentary multitasking, Microsoft could have an exceptionally solid version-one product in Windows Phone 7 — especially when coupled with the company’s fierce outreach to developers.

Of course, that’s a big “if” — the clock is ticking on Windows Phone 7, and the industry has already proven that it won’t wait around for companies to play catch-up. It’s not about lapping the competition at this point, it’s about just being in the race — and if Microsoft doesn’t know that by now, it may already be too late.

Readers are encouraged to peruse the full preview.  Engadget editor, Joshua Topolsky, certainly catches here the importance of WP7 for Microsoft. If you divide Redmond’s business in 3rds: Server Software, Windows, and Windows Client Apps – the success of Windows Phone 7 ensures the viability of Windows and Windows Client Apps going forward; failure [and if WP7 does even 10 times Kin, that is failure] means Google and Apple apps will do unto Windows and Windows Client Apps what Firefox and fellow browsers have done to the once proudly 90%++ market share IE franchise.

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Summer IT Soap Season: AAPL vs GOOG vs MSFT

Posted by admin on Jul 19th, 2010
2010
Jul 19

Summer Theater is well …. soapy, meller-dramatik, and often tainted with fits of outrighteous comedy and unexpected self-satire. And this season’s IT Summer Stock is packed to the gilt edge with certified Box office bonanzas. First there is a new Summer Stock Valuation leader – AAPL, displacing vaunted enemy number one, MSFT from the top of the IT Market Capitalization Heap. Next there are those brash Mountain View college boys goog-ing and getting into every nook and cranny of the Cloud they have searched 10 to the 100th times. In the process, GOOG is thereby increasingly displacing MSFT and AAPL into 2nd place position in many a market. And MSFT has developed a persistent shank shot when teeing off into new markets with Courier, Kin, Mobile 6.5, Zune all doing the Vista Poo.

What makes the Summer Season even more eventful is the players. Take AAPL’s Steve Jobs, the new Emperor of Innovation, is taking swings at ADBE and its Flash when the real problem appears to be that AAPL has under-engineered the graphics drivers [or allowed contractors to do the deed]on its hardware. So all this time AAPL has been selling at double if not triple prices graphics inferiority to its carefully cultivated design & graphics acolytes. Now that is real meller drammer material! But not to be outdone MSFT’s CEO, Dancin Steve Ballmer [ why he hasn't done Dancing with the Stars is a mystery to all us fans] is swatting back at the new Emperor and vowing to swat down the iPad and iPhone with a horde of new tablets and Windows Phone 7 smartphones by Christmas[which Christmas is not stated].

So with these players and shows going on this Summer IT Soap Season, it seemed appropriate to see what the various IT  reviewers had to say about the Season . Several key shows are on tap this Summer – lets see how well the IT Tech Press has covered them. Note that stories/reviews marked in green are must-reads on their “shows”:

1)Will Microsoft Windows Phone 7 make the mobile market cut – this is Redmond’s 5th and last swing for a presence in the rapidly emerging and huge mobile and iDevice markets. They have already had swings and misses with Windows Mobile 6, Mobile 6.5 , Zune, Courier and Kin – another miss would see Microsoft out of the fastest growing and most influential IT market. How has the Tech Press covered this?

BNet – sets the “what is at stake table” with So Where’s Microsoft ?
BusinessWeek - mid July & Ballmer promises presence in Smartphone and tablets

Computerworld – Hints of trouble with Window Phone 7 and reliance on Zune software

Computerworld Humor - Why was Russian spy working at Microsoft?
Engadget – Looks at 5 gadgets that failed including Microsoft Kin as prelude to WP7
eWeek – Lists ten markets misses for Microsoft, Mobile phones is at the top
eWeek – Sets out 4 key success factor for Windows Phone 7
NYTimes – has hinted at problems with Youthful market spurns the wares of Microsoft
GizmodoJuly 19th Windows Phone 7 Review is upbeat with caveats
InfoworldJuly 15th Windows Phone 7 : Don’t bother with this disaster
Note these three must-reads could not be more different in their conclusions

ZDnet July 18th technical preview of Windows Phone 7 – a winner come Christmas

PCWorld - grave reservations on Windows Phone 7…it maybe Vista again
theRegister Humor – Vista hating Microsoft throws poo at Apple iPhone 4
ZDnet – a second, more cautionary take on Windows Phone 7


2)Apple’s Steve Jobs has done a PR no-no: openly disparaging Adobe’s Flash software while cutting off Java and program generators from use on Apples iDevices – Is Steve’s harsh criticism of Flash justified? Why include Java and program generators as banned software tools? Is Steve’s HTML5 to replace Flash solution viable ? What is behind the ban?
AllthingsDIf Steve Jobs Is a God, How Could He Be So Wrong About HTML5 vs. Flash for Us Mere Mortals?
BusinessWeek – lays bare Steve Jobs attacks on Adobe Flash
Gartner Blog – very early on in debate defines some of the key trade-offs on Flash, Java, and HTML5
Gartner Blog – compares the Apple developer economics to Facebooks
GizmodoApple takes developers hostage in War on Adobe – how far Apple goes to ban Flash
Infoworld – Java developers are left outside of all iDevices
Keep an Open EyeApple vs Adobe: Vetting Steve Jobs Flash Assertions
NYTimes - Is Apple a victim of Sour Grapes briefly mentions Apples ban of Flash
O’Reilly – YouTube and Hulu voice caution about replacing Flash with HTML5 video
theRegister - Humor – Apple reels as Steve Jobs Flashturbates
Wired – decidedly for Flash replacement by HTML5


3)Google’s Android is coming from behind to challenge Apple’s iDevices with an Open Development and Support model in contrast to Apples Closed Ecosystem – Do the two ecosystems make a difference in consumer and/or corporate buying decisions? How well is Android doing in the mobile phone and tablet markets? How is Apple fending off the OS leads that Google has?
BusinessWeek – 10 best Smartphone Apps for college – iPhone-10, Android-6, BBerry-2
Computerworld
– the iPhone 4 vs Android battle
Engadget – Nielsen says iPhone has 3 times market share of Android phones
eWeek1 + eWeek 2- 2 must-reads cover major trade-offs between iPhone4 vs Android2.2
Gizmodo – great graphic summary:The-dogs-of-war: Apple vs Google vs Microsoft
PCWorld – one of several very good articles on Android vs iPhone
theRegister - Humor- The “truth” about the iPhone 4 antenna problems
theRegister – superb analysis on developer advantage Android has over iPhone


Summary
The Tech Press acquitted itself reasonably well in covering these issues. First, there is a surprising amount of good if sardonic humor. One could easily double the number of humor articles. The traditional Tech Press acquitted itself well with eWeek, Infoworld, and ZDnet all bagging must-read articles. The nouveau gadget press also is well represented with AllthingsD and Gizmodo showing up in the must-reads. TheRegister easily took the humor crown with some deliciously funny send ups that The Daily Show or Stephen Colbert would flash green with envy at.
What was surprising were three things: not much presence of the Business press with just BusinessWeek, Gartner and NYTimes catching mentions [if Gartner and NYTimes can be thought of as Business Press]. I looked at Forbes, theEconomist, Fortune, WSJ… and they were doing latest news stories on these fast moving, big events in IT but certainly not the Brobadingnagian Battle Story. Second, the Android vs iPhone story got a lot less coverage than expected. After all these are former near partners now swinging tooth and nail with Apples iDevices’ Design++ and Closed Ecosystem vs Google Android and Chrome’s Massive Competence and Open Source Ecosystem. This is legendary Business Case material – only BusinessWeek showed up with big view articles.
However, the most interesting trend was the widely diverse opinions on Windows Mobile 7. Gizmodo and ZDNet loved it; Infoworld was thorough, but curt with its assessment – “Don’t bother with this disaster”. PCWorld was middling, but favoring caution. This is no small matter because if Microsoft shoots itself in the foot a fifth time for Mobiles – the train has left the station. And what brought Microsoft to so much power in the IT industry, its UI and Windows, will surely wither away over the next 3-5 years barring a major merger or acquisition.
In sum, the IT Press coverage was a lot better than expected. I suspect the young guns like Engadget, Gizmodo, TechCrunch [just missed on 3 stories] are keeping all the players more committed to following the IT game. With the two Steves out there pitching their IT wares and throwing a lot of high heat – there are big Summer Blockbuster stories just waiting to be written.

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Google Adds Online Photo Editor to Picasa

Posted by admin on Jul 18th, 2010
2010
Jul 18

Picnik is one of the best online photo editors – it is now a part of Google’s Picasa line of free online photo albums.  The good news is that Picnik is fast and has some of the best online photo edit features plus context-sensitive help & hints.

The system seems to be a bit slower on startup than benchmarks on the same machine two years ago [20 seconds then 32 seconds now, but that may be online service variations]. But the operations are still fast and responsive. More interesting are three things Google has done with Picnik.

First, Google has barely changed Picnik at all from a functional and feature viewpoint. What you saw before is what you now get. Second, they have retained the $25/year Picnik Premium edition which adds a number of creative effects and special features to Picnik’s photo editing capabilities. This is an important decision because traditionally Google has not charged for its consumer web services – letting advertisements pay the freight. For example Maps and Gmail on the consumer side have added features that could be thought of as premium but they have not charged for them. Picnik appears to be a testing of the waters for charging for premium Google Online services.

The most important aspect is that Google continues to invest in Picasa and “social” image processing.
Google now has in Picasa roughly equal online web album features as Flickr or Facebook but now with a)unlimited free web storage of images; b)more useful image editing  than Facebook [but not Flickr which uses Picnik too]; and c)recently improved discussion capabilities to match Flickr,  Facebook and other online photo services. See here for Picasa’s nifty Explore page, which like Fotki and Flickr, watch the Photo Pulse of the World day in and day out. Clearly along with Buzz, Calendar, Reader, and the upcoming Google Wave, Google is lining up to face the growing Facebook challenge for eyeballs and online advertising space.

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iDevices II : Rapid Evolution

Posted by admin on Jul 15th, 2010
2010
Jul 15

The first post on iDevices argued that the currently breaking wave of new iPhones, smartphones, iPads and tablets represent a major new face to personal computing. The common denominator among these iDevices is high portability, Web and WiFi connections, touch+gesture powered ease of operations, plus small but dense screens that are visible in most lighting conditions. But other characteristics distinguish these gadgets. Their OS are major rewrites with greater security, reliability and speed of operation. They are packed with sensors, camera, and audio devices that compliment the wide array of media supported. They have public APIs that allow 3rd party developers to write now hundreds of thousands of apps that allow users to customize their iDevice exactly the way they want.

But this customization works the other way too. 3rd party vendors can hop aboard any  iDevice [note this could be Apple but also Google Android, HP webOS, RIM Blackberry OS, etc]  they choose  by simply using their APIs in developing an app for that iDevice. The 3rd party can then  tie their specialized tool, say a geodometer for survey work,by means of the selected  iDevice API and then have a well know and often used interface as a value add for their equipment. This could also true of PCs and laptops but they are not nearly as light, portable nor have full working day battery life plus touch and tap interfaces to match iDevices.

Finally, what makes iDevices a new category of PC  is the various trade-offs engendered in their design. These trade-offs  include  weight+size [smaller screens than PCs, no big hard drive or GPU, etc], no connectors needed [neither mouse nor keyboard required and few ports for cable connectors relative to PCs and laptops] and battery life of at least 7 hours [no use of high speed dual core CPUs or GPUs or battery guzzling hard disks]These design patterns  bring unique functionality to iDevices which  distinguish them as  a new type in Personal Computing.

True by adding a docking station with keyboard, mouse, and external hard drive, an iDevice becomes an average laptop but with touch and tap easy use. But free an iDevice of these constraints and it becomes a highly portable remote display and controller connected not just to the Web but likely hundreds if not thousands of tools and gadgets by WiFI, HDMI, etc.  This is why any company  in Personal Computing better also be into iDevices.

The final distinguishing characteristic of iDevices is their rapid evolution. True, iDevices were preceded by PDAs – Personal Digital Assistants like the Palm Pilot, Apple Newton, and Windows Mobile of 10-13 years ago. These devices pioneered the ideas of light weight, high portability, longer battery life, and an array of  built-in apps to choose from. However, lead by Apple with its iPod, iPhone and now iPad the winning trade-offs and design characteristics of iDevices have  rapidly evolved in the past 3-4 years.

The rise of iDevices follows from the 80-20 rule.

80% of users employ only 20% or less of their PC’s functionality. Think of iDevices as computing that matches a big chunk of those 80% of users. How?? By catering to their media, display and messaging needs. These users are looking for access to computing power around their  voice and text messaging ; music and images; games and video; and finally a panoply of web access services. Note that all of these uses tend to be Low I, High O => Low  Input/High Output in  device activities. In contrast, many important activities on the PC are the exact opposite – comparatively high input to lower output ratios.

iPod delivered the music and images first and best. Then iPhone delivered voice and text messaging plus Web services with all that iPod could do yet still in a handy portable fashion and extended touch screen ease of use.  Many of the  iPhone ease of use features  with touch + gestures  were added to the IPod Touch. And soon everyone in the smartphone and tablet market did so or at least intended to do so.  But most important of all iPhone added all day battery service and not thousands but hundreds of thousands of apps for customizing what “your” iPhone could do.

The final winning touch has been that  the iPad  deliberately eschewed any keyboard, mouse or tethering connectors – to deliver a highly portable viewing device suitable for Web pages, movies, games and email/Web connections. Yes, iPad is emphatically not just a PC [although with a docking station it can quickly become one]. iPad is important for what it does not have:

1)lets repeat – no keyboard, no mouse, no tethering connectors to tie it down;
2)no 4 hour or less battery life – with 7-9 hours meeting most workday needs;
3)no great weight – light and highly portable;
4)no problems reading the screen in many lighting conditions – an eReader with color;
5)no great slowdowns in response time – with a native 1GHz CPU delivering consistent speed;
6)no hesitation in how it works – as the simplicity of touch and gestures prevail;
7)no throwback OS – to encumber with old install, response time, and security problems;
8)no overwhelming size or added plugins to discourage taking an iDevice anywhere.

Following in the style of Microsoft’s Steve Ballmer, the common appeal of these iDevices for many users are: Mobility, Mobility, Mobility; Simplicity, Simplicity, Simplicity; Security, Security, Security; and Profitability, Profitability, Profitability. Lets look in detail at each factor in turn.

Mobility

The attraction of iDevices is that they are PDA-Personal Digital Assistants that are now touch+gesture easier to use and with about 200,000++ more apps and ways for users to customize to their precise needs and hearts content, whichever comes first. Better, the price and task of downloading and installing the exact app a user wants is a lot cheaper, easier and faster than most corresponding software buys and installs.

But the essential here is that iDevices are mobile++. This means light in weight, fit in a shirt pocket and/or backpack and thus can be easily carried to class or work. Second, their battery life is 7-10 hours or more – equal to a working day and much better than most PC laptops and even many netbooks. Third, iDevices allow users to carry their phone/data connection with them wherever they go. So can PC  laptops but not for a full day nor with such mobility and high touch simplicity[see below] as iDevices.

Do not dismiss the attraction of highly portable and connected. High mobility has arrived at the same time as highly connected has become so attractive -games, geolocation, social media, rich [video] or swift[text] messaging and web browsing are iDevice norms. Add to that the advantage of having your chosen data profile about yourself, your location, plus conditions and events in your surrounding environ available – and suddenly apps can deliver innovative value to you wherever you. Query and find the nearest restaurants. Check the route to the plaza and restaurant.  And check the  balance in your chequing account to make sure you can cover the bill.

PC laptops or netbooks barely serve these  connected query needs. They don’t have the battery life or convenient portability. But most telling of all, laptops lack the onboard  sensors, touch sensitivity and app programs of iDevices that provide so many value add services.  The parade of iDevices  has been lead by Apple but Google with Android is close behind . And just behind again is a gaggle of competitors from RIM through Dell and HP to Intel/Nokia and  a slew of East Asian players like Acer, Asus, HTC, Samsung, etc.

Simplicity

Touch+gestures deliver a new level of simplicity and ease of use to computing. A  friend, a PC phobe, loves her iPhone. As she says – “even my parents borrow and use my iPhone”. iDevices have brought, by means of no keyboard and no mouse, simplicity and ease of operation back to computing. True, there is a trade-off  with iDevices – with only a software keyboard, large amounts of text input can be a tedious task. But there is another key factor in iDevices favor.

Smartphones and tablets have allowed software developers to rethink program design .Limits of screen size and computing power plus demands for game-like quickness of operation have meant a return to simplicity and ease of operation. In contrast, these GUI virtues have been slowly but surely drained from PCs – be they Linux, Macs or Windows powered. Just ask anyone who has to use word processing, spreadsheet, or report writing programs in any of those OS.  PCs have become so  hard to learn or to remember how to use. The reverse 80-20 rule applies- 80% or more of users know only about 20% or less of a program’s commands and functions. However, it is important to note that touch screen + gestures can be implemented on both PCs and notebooks thus potentially neutralizing one key iDevice advantage.

Another key is that simplicity of installation and use coupled with lite, compact and easily accessed apps make these devices very attractive. iDevices means  having a self-customized Swiss Army knife/electronic gadgeteer that is distinctively setup for personal use.  iDevices are true  Digital Assistants which  allow users to communicate  and interact with friends and business colleagues  in many novel ways.

Security

“You have got to be kidding!” - No, security is better on iDevices for 3 reasons. First, the OS on most popular iDevices are brand new so the hackers don’t have a huge kitty of zero day virus  and repertoire of hacks available to crack into the OS. Second, the iDevice vendors have deliberately targeted their OS to be highly secure. One of the advantages of Google’s Android and Chrome OS operating systems is that they have been built using the Linux kernel – still one of the safest OS around. In addition, Google is putting extra effort into securing operations on these two OS. But that is true of all the vendors: Apple iOS4, HP’s webOS, Intel+Nokia’s Meego, Microsoft’s Phone 7, and RIM’s Blackberry OS.  All are new OS so they have no excuse for fumbling security – they know the problems that exist and have a lot of software defenses to secure their OS operations. What will be interesting to see is which OS performs the best after the first onslaught of iDevice hack and virus attacks.

But the third reason for iDevice’s greater security is that both users and companies have been chastised. No more short cuts by users in providing for their own security. For example, as more financial transactions get done online and through iDevices, financial institutions are only allowing transactions if basic security protocols have been observed. Also there are more and easier to use apps to verify that your iDevices are properly locked down. This more vigilant security will become more important as mobile phones are already being used in parts of Africa and Asia as major payment devices in lieu of cash or credit cards.

Profitability

Consumers love iDevices because they cater to their needs by being app-packed and customizable; hence iDevices are very profitable to most consumers. No need to buy a cellphone and a game console and a media player and an eBook reader- just get a Google Android like Droid X. And if you later decide you need GPS locator there is likely an app for that from Apple and Google and pretty soon RIM, HP and Microsoft too. Consumers love the profitable dollar savings engendered by iDevices with the bonus that they are much easier to use than many PCs.

Telephone company’s love iDevices because they, even with $150-300 rebates, recoup the dollars invested with added services and monthly data plans. Yes,  the days of unlimited data plans are rapidly coming to a close. The  day of reckoning is justified by  the 10-90% rule which Telecoms believe  has to be broken  - that is a very small set of users [around 10%] eat up 90% of iDevice bandwidth on their unlimited monthly usage plans. And with AT&T in the lead that new direction has been reached. This will allow telephone network providers to price on usage and recover bandwidth and revenues lost to the download hogs. Since Takethe5th is a download hog, one can be assured there are some unhappy users.

Small to medium size developers love iDevices because they are back into  money-making for their software.  PC vendors like Apple, Microsoft, and yes even Open Source had either completely cut them off from traditional  markets or  had squeezed their revenues down to a trickle. With iDevices the top level prices are not huge; but the volumes in millions of units can certainly make up the difference.

Finally, gadget makers including Apple, HTC, Acer, etc love iDevices. Its a huge, growing, and still very profitable market. Its not controlled by Microsoft; but Apple is doing its utmost to recreate that monopoly situation on iDevices. Google, RIM, Nokia/Intel and HP are trying to avoid that no-Win situation again. But right now iDevices means profitable growth for those ready to deliver nifty light touch devices  - and  preferably by Christmas 2010.

Why Light Touch  Has Won a Huge Market

One can cite the above 4 reasons and a few more rationales as to why light and touch+gesture savvy  iDevices took off. Here are some factors in the surrounding IT and personal usage industry that helped to propel iDevices to the forefront. Think of these as some necessary pre-conditions   for iDevices to take-off.

PDAs and iPods first had to pioneer with tiny apps, high mobility, and long battery life – the success here confirmed that there was a big market for customizable mobiles.

CPUs with high GHz, low cost, and low power consumption had to become available – hedging its bets even Intel supplied Atoms and other micro CPUs.

Flash memory had to become low cost,  more reliable and higher capacity – and it did.

3G and WiFi had to  deliver – and they do with enough network capacity to handle calls, simple videos, and reasonable email and web browsing.

Vista had to fail badly sewing discord into the Windows brand and monopoly – It is clear that  Vista failed for any number of reasons but most critically it was harder to use, more expensive and slower than its predecessor, Windows XP. Also for many users older software, games and peripherals that worked in Windows XP did not for Vista. Finally, before fixing Vista Microsoft took Windows XP forcibly off the consumer preloaded PC market- users had to pay more for a downgrade to Windows XP and do the re-install on their own. This drastically changed the consumer mindshare against Microsoft – they were perceived as being part of the problem in getting computing and PCs working effectively for many consumers.

Microsoft had to fumble tablets – despite having almost free reign for 10 years in tablets and Pen OS, Microsoft and partners failed to deliver a compelling tablet in either the consumer or corporate PC marketplace. Admittedly this was a difficult task because it required moving off the Windows suite spot. However, this failure confirmed for many users that they would have to look elsewhere for device innovation to meet their needs.

Creation and/or Development had to take a back seat – many PCs are powered as if everybody was a super-user or core developer or high paid graphic designer that needs all the  screen area , computing power, peripheral connections possible. Laptops have become mini software development or video/media creation machines or huge 3D game enthusiast platforms. This is maybe 20-35% of the total consumer PC market. But for many users all they want is email, web browser, word processing, picture and video taking, Picasa-like image processor for those images, some simple games and maybe 3-5 other simple specialty apps a few of which they already get on the Web. What they would prefer is all this accessible  in one device  -  voice, image, video recorder operations and then the ability to store and forward those media  objects with ease, simplicity and speed.

One can see the shifts in emphasis enabled by iDevices in their rapid evolution – back to ease of use, customer primacy, better security, light weight and handy mobility, etc. But there are new features and functionality as geo-location, motion sensors, and media devices like a video+still camera are brought on board. Takethe5th hates software installs and updates. They can be long and tedious, require a reboot, or require a redo because of faulty configuration or shades of .DLL Hell. Then the ever present updaters constantly resident, taking up memory space and CPU cycles, and constantly nagging you to Update Now! So far many iDevices have gotten this rite right. But Takethe5th is from Missouri – show me this kindness for many more years.

Summary

The last observation is key to understanding iDevices. They have and are still evolving very rapidly. The demands of quarterly profitability may change the vendors “consumers first” tune [Apple appears to be doing that with the iPhone 4 antenna problem]. Finally, there is an absolute wave of new products coming to market in the next half year. The last installment on iDevices will examine these new trends plus the winners and losers as iDevices establish their position in the Personal Computing market.

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iDevices – the new Face of Personal Computing

Posted by admin on Jul 14th, 2010
2010
Jul 14

Peering into ongoing innovation is like  looking at a prism. One can see images of what is emerging but the various shapes of an evolving idea in the market are like the facets of the prism – each one sees different forms, strategy and structure.  iDevices presents just such a kaleidoscope image as a  mix of iPhones, smartphones, iPads, tablets, and slate computing devices that have emerged from PDAs-Personal Digital Assistants  in the past 3-5  years.  iDevices, pioneered  by Apple Computer and hence the name, imply a highly personalized computing device. iDevices take  PDA’s  light and  mobile factors  and go well beyond  with  much better Web connections,  impressive computing power  which supports new levels of ease of use  fostered by touch+gesture savvy yet still carrying at least a full day of battery power.  iDevices are not only Web connected but also media proficient by presenting dense but highly readable  and maneuverable screens powered by on-board digital still and video cameras, microphones, motion sensors, GPS locators, etc.  But the icing on the cake is the hundreds of thousands of plugins or apps that can be used to extend and customize what an iDevice can do for each individual user.

But perhaps the biggest departure for iDevices is that they represent a rewrite. Not just a rewrite of the operating systems that control them[iOS4 for Apple, Android and Chrome for Google, webOS for HP, Meego for Intel/Nokia, and Microsoft Phone 7 are all new Operating Systems]  but also of the way users are served by computing devices. Thus,  by means of touch screens and on-board sensors, iDevices know where you are, how you are holding them, what is nearby but most importantly –  what you want them to do for you. Touch + gesture savvy iDevices are like Web 2.0 – they take computer interfaces to a new level of re-dedication to personalization and ease of use.

Now some observers, like Microsoft’s Steve Ballmer, would beg to differ and sees light touch devices [or iDevices]as just another PC. If you plug an iDevice into a docking station it becomes a point and tap PC. Thus iDevices can be handled like netbooks and the EEE PC – the first editions of light, mobile, and powered for a day. For  awhile netbooks allowed Linux to  make significant inroads into a consumer “PC”  market. That incursion was quickly stomped on by Microsoft in the Summer of 2008  with the resurrection of  the just discontinued Windows XP [Vista would not fit].  And users flocked   to Windows XP netbooks by a factor of 80%++. But the victory may have been Pyrrhic as Redmond was lulled into thinking an adapted Windows  could handle the new computing paradigm represented by iDevices.  But in fact  Microsoft’s Windows XP and Win Mobile OS did not support  touch + gestures interfaces, the many new sensors,  nor the low power processors which were dominating the rapidly evolving  iDevice market.  Apple’s iPhone/iPad and Google’s Android powered devices were ceded a big lead in the market.   So iDevices, as Microsoft has learned to its chagrin, are different than PCs be they desktop, laptop or notebook.

To  help underline the game changing nature of iDevices, consider Information Week’s Executive Editor,  Bob Evans, and his  very telling Open Letter  to Steve Jobs in the June 28, 2010 issue. The note describes how much iDevices have changed thinking in Enterprise Software. Bob quotes SAP Chairman Hasso Plattner:

Plattner said that the application of that new technology within SAP’s products will be dictated not by any SAP technology or product strategy, but rather by the real world experiences of the company’s customers for whom mobile access and decision-making are becoming indispensable.

“People at SAP ask me why do you insist on running a dunning program in two seconds  instead of two minutes ? No one is asking for that kind of speed for a dunning program. And I tell them you are asking the wrong question. The right question is how long will someone with an iPhone wait for an answer? And the answer is that 15 seconds is the absolute maximum amount of time people will wait before they go and start doing something else: check voice mail, send text messages, check email …This is the new reality.”
Plattner and SAP now realize that the world of enterprise applications is no longer about the complex code but about how a rapidly expanding set of users gain value from SAP Software … so Plattner says 15 seconds is the new limit….

The essential point is that iDevices with point and touch  gestures are seen as being  the optimum user interface. Many IT analysts concede that iDevices are changing how consumers  interact  with computing as they do messaging, use multimedia and play games; but the analysts  insist that iDevices have yet to have an impact on enterprises. Bob Evans  begs to differ and says look how one of the major business software vendors is reacting to the simplicity and speed of response that is built into iDevices.

How iDevices are More than Super PDAs.

iDevices are certainly outgrowths of the PDAs-Personal Digital Assistants like the Palm Pilot,Apple Newton, and Windows Mobile devices of the late 1990′s to  about 2005. But then “things changed” with the launch of the iPod followed by the iPhone. A new computing device emerged –  the media and touch savvy,  Web-connected iDevice.

The crucial difference between  iDevices and  PDAs  are low-power but much more computing power, touch sensitive interfaces, sensors everywhere[ like phone, both still and video cameras, speakers, voice mike, accelerometer, etc], expanding app program catalogs, and denser but more readable screens. All these factors have allowed iDevices to absorb, like Black Hole gadgets, other popular but limited use computing devices  like simple cellphones, mobile game consoles, eReaders for books, hand-held GPS locators, media players, etc. Markets for these limited gadgets dwindle as smartphones and other iDevices meet their needs for many consumers often with an easier to use interface. For end users the attraction is one device and low cost customization  with easily downloaded and installed apps or plugin.

Summary

iDevices reflect the need for a very easy to use interface to computing power that is light, portable and easily connected or plugged into both the broad Web and other “smart devices”. Vendors in the market are beginning to see the opportunity. iDevices are moving beyond being super smartphones or the optimum eReader or the handiest game console. iDevices with their WiFi connections and easily installed apps will become the universal remote controller, the interface of choice not just to the Web, voice and messaging but the standard connection device and interface to any equipment that has a computing server with builtin iDevice “smarts” to exchange and deliver data to the iDevice. The near future will see iDevices configuring and controlling equipment they can smart-link to. Our next post in this series on iDevices examines their rapid emergence and how they evolved to become a new face in Personal Computing.

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World Cup of Sports

Posted by admin on Jul 12th, 2010
2010
Jul 12

Football[soccer in North America] after World Cup 2010 can make its case as the World Cup of Sports -  the most popular in the world especially if TV ratings are used as a measure of popularity. The 2006 Word Cup Final had an estimated 600++ million TV viewers North American  World Cup 2010 TV ratings were up by a whopping 36% despite having to contend with baseball, basketball championships, motor sports, Wimbledon Tennis Championships, etc.  FIFA with the World Cup should be congratulating themselves on a new rise to ever greater popularity.

However, George Vecsey’s assessment of World Cup 2010 in the New York Times in praise as  an alluring beacon of sport has a curious, melancholy twist:

So many World Cup finals are dark affairs, with one shadow or another looming over them. This final had no taunting or head-butting like the last one; no team played with an undetected Hand of God in its recent past.

And in the long run, the very long run, this final did not end with the gloomy coup de grâce of penalty kicks. Instead, it had two crack teams, two grand soccer traditions, testing each other for a long time…

There in lies the rub. This World Cup was alluring because it was not botched by the 5 problems plaguing FIFA’s sport:

1)Refereeing.
2)Not enough goals.
3)Refereeing.
4)Not enough goals.
5)Refereeing.

Lets look at these problems in their order.
1)Refereeing is the number one problem in FIFA’s football. No, not because of the record 13 cards handed out in this World Cup Final.  Rather because players are now openly gaming the game. The players know that because the referee is often so far from the “scene of the crime” while the sideline referee assistants are so absorbed in getting offside and ball out of play calls right, players can get away with murder. Murder in this case is anything from cleverly disguised pushes and shoves through shirt pulling and other free and corner kick wrestling matches to open bating and taunts. In short, FIFA’s World Cup games are always at the very edge of running out of control epitomized by Zinedine Zidane’s head butting redcard in the 2006 World Cup Final. It soured the game and the Italian “victory” badly. FIFA risks declining credibility as the lavish and superb TV coverage exposes the game’s officiating deficiencies ever more clearly.
2)Not enough goals is  very close to the top problem in FIFA’s football. And there are clear indicators.  The average number of goals scored in World Cup 2010 was 2.3  second only to 1990′s 2.2 low point and the stellar average of 5.4 goals/match in the 1954 World Cup. Low goal scoring brings on the  worst possible outcome,  George Vecsey’s “the gloomy coup de grâce of penalty kicks”. In the past five World Cups 2 were decided by penalty kicks and 2010 was just 2 minutes away from the same outcome. Ditto for  the Womens World Cup. The game is in danger of  dying for goals.
3)Refereeing is the number 3 problem in FIFA’s football. The beautiful game is is being marred with player’s stage acting. Thespianism can be highly rewarded. Dive whenever remotely close to the box and any contact is at hand. Dive dive  and writhe when your team needs  a breather or break in the action. Forget the free flow of the game; just get an advantage. And the players know they can get away with it, especially when the referee is 20 or more yards away. And if a freekick or penalty is available and 1 or 2 opposing players are nearby – dive, Dive, DIVE! World Cup 2010′s MasterDiver – Spain’s Andres Iniesta.
4)Not enough goals is the number 4 problem in FIFA’s Football. The goals per match are dwindling and not just in the World Cup as defenses get better and so does the sideline officiating. Give credit where credit is due – the side line officials were shown to be right by at least 3 or 4 camera angles in their offside and out of touch calls [but certainly not their goal score calls]. So FIFA should adapt. Basketball increased scoring  by establishing the threepoint shot. Ice Hockey reversed a similar trend in declining goals per game by limiting the size of gear worn by goalies and defensemen plus tweaking other rules. And the opportunities open to FIFA to  to opening up the game  can be simple and effective as these 4 examples show:
i)Raise the net by 4 inches or 10cm – many more top of cross bar shots would go in.
ii)No offsides for the the first pass over the midline – this would create space and new offensive strategies.
iii)No tackles from behind – tackles from behind slow the pace of the game down considerably and have given defenses the upperhand in matches. They are also the cause of  protests and diving.
iv)add  another on-field referee like baseball,  basketball and ice hockey all have  done -Better calls means fewer infractions because players know they cant get way with murder, play is speeded up and more goals per game follows.
FIFA must recognize that 2-5 goals per match is literally gold for their sport.
5)Refereeing is the number one problem in FIFA’s football. It is centered on having only one referee on a field that is 120 meters by 45 meters. Referees run a punishing average of 12 miles per game. Yet with long ball passing and swift counterattacking, referees inevitably find themselves out of position to make the right call. And the sideline officials have enough problems spotting offsides, out of touch balls, and balls crossing the goal line.  The case could readily be made for 3 on field referees. This would eliminate all the tugging, pulling and wrestling on freekicks.  Offenders caught touching would be whistled out of the box. More goals would be scored from corner and free kicks. Referees could more easily stay out of the way of play as they would be strategically placed  and could move out of the flow of  play[and would have more energy to do so].  In general, the players’ dives and other cheating would decline and the flow  and scoring in games would likely take an nice uptick.
FIFA football, at its peak in popularity, is also in danger of spinning out of control. Increasingly often referees are barely able to keep games under control as players play the cheat game within the game. And fans, already restive, can just say their actions are justified by the stultifying low-scoring games with  so much on-field cheating. So as one English mobster-like fan was quoted as saying – “we need to stir the game up a bit”.
Certainly FIFA administration needs a little stirring  up. Or FIFA could become like Cycling and Major League Baseball, reacting timidly to emergencies that call the quality of their sport into question.  And thus ironically, FIFA Football at its peak of popularity could likely lose its title as  the World Cup of Sports.

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Fearless World Cup Semi-final Forecasts

Posted by admin on Jul 6th, 2010
2010
Jul 6

Forecasting as Larry Summers and the other members of the US Economic team have learned is a very risky business. Eight percent unemployment rate by this time with TARP fund assistance. No worry about a double dip recession. So fearless and without further to-do, here are Takethe5th’s World Cup forecasts for the Semifinals:

Netherlands 2 Uruguay 1

Too much of Uruguay’s talent is on the sidelines due to cards. Forlan cannot do it by himself. The Dutch, with Kuyt, Robben, Van Persie and Shneyter have too much fire power. It will not be a cake walk but also should not be a penalty kick victory either.

Germany 3 Spain 2

This scoreline is subject to reversal if Fernando Torres gets out of his Wayne Rooney suit and finally starts to score.  But see this astute assessment of German play so far in the World Cup in Vanity Fair. Already, Germany has frustrated an offensive and skilled passing team in Argentina; so they should be able to do it again, unless the raging bull that is Torres scores a goal or two.

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Lessons for World Leaders from the World Cup

Posted by admin on Jul 6th, 2010
2010
Jul 6

The World Cup is providing great TV, Press and Internet coverage and there-in lies the lessons for World Leaders. Great coverage means bad plays as well as good ones get big coverage. Take the tic-tac-toe passing of the top clubs like Germany, Spain and the Netherlands – all 3 teams are semi-finalists. But bad play gets covered too and often from 2-3 angles. Take the officiating – blown goal calls [think England's lost goal against Germany and the US against Slovenia]; wrestling mayhem on corner and free kicks in the box; late tackles mixed with great thespian dives; shirt, pants and arm holding and/or shoves, etc. With one referee to cover a 120m by 45m field – there is plenty of room for error. And fans all over the World are seeing this in HDTV with instant replay live on TV or in You Tube replays on the Internet. FIFA is going to have to do a lot better on officiating or see the its Championships like the 2008 World Junior Football Championships in Toronto become crass spectacles of mass deception.

Likewise World Leaders cannot discount the wave that is high definition TV and the Internet. If the TV and Print Press don’t get the story right – and it is hard to dodge these two sources sometimes wobbly aim – then the Internet with it tens of millions of blogs, tweets, and searches will reveal the underlying current of truth. Senator John Edwards saw his once presidential ambitions become the butt of paternity jokes. Israel has seen its low credibility in negotiations with Palestinians sink to new depths with the continuing Israeli settlements on West Bank territory and then the ham-fisted land followed by sea attacks against Gaza’s Palestinians. Now Israel is perceived by America’s top leaders as a liability in its war on terror. Finally, China has had 12 suicides at the Foxconn plant plus other labor strikes at nearly a dozen sites throughout China as low cost workers strike against minimal wages that are not even matching the rate of Chinese inflation.

In sum, World Leaders have still not come to terms with a)the speed and spread with which stories unfold on the Web and b)the quickness with which events they actively work to cover-up are revealed. First on the Web and eventually in the Press and TV. The Politics of Deception has turned – and World Cup coverage is the mark of that.

The other lesson of the World Cup is remorselessly pragmatic. Assists win. This remarkable fact is again underplayed by FIFA – the only major team sport that does not credit players for contributing assists on a goal. The World Cup Golden Boot is for Goal Scorers only. Yet, basketball with assists, baseball with RBIs, ice hockey with assists all record and reward with trophies and extra-compensation for players who contribute to the production of scoring plays. And anyone watching the World Cup has seen many a tap in goal and many from the passing and assists savvy teams like the aforementioned Germany, Spain and the Netherlands. Takethe5th won’t belabor the point and implications for World Leaders.

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Made in China: Rising Costs

Posted by admin on Jul 5th, 2010
2010
Jul 5

The other shoe has fallen -China announced today that its currency would be priced based on a basket of currencies rather than exclusively on  the US dollar. The net result is that Chinese goods should become more expensive. But this  broader pegging announcement has been heard before and the Chinese manage to wriggle free  of currency appreciation [temporary measure or only certain industries or the basket of currencies mime the US Dollar themselves]. Just before the announced gradual revaluation, China had  already seen substantial wage increases due to labor agitation [33% now 70% more in Fall for many electronics worker]and 20-30% again in the auto sector [Toyota and Honda so far]. Bottom line is that in key sectors like technology  and autos plus other businesses using China as a key supplier will see continuing cost pressures. Given the competitive environ for both industries [technology sees invasion of new players in markets Apple and Google have pioneered while all automakers are scrambling for a declining total new car market] expect earnings in both sectors to see downward pressure. Retailers that are also tied into low Chinese import prices will also be pressed to the extent they cannot pass on Chinese price increases to their consumers. In sum, expect major downward adjustments to associated stocks.


Update: Japanese Nikkei business paper sees similar pressures:

A recent editorial in the Nikkei business daily highlighted the issue, noting that demands by Chinese workers for higher wages marked a “sea change” in China’s low-cost production model. “The situation poses a major strategic challenge to all manufacturers that have set up production in the country to capitalize on its low labor costs,”

Update 2: July 5th, 2010: A NYTimes article examines how rising labor costs in China  and the projected rise in the Chinese currency will effect Apple and other large technical producers like Dell, HP, and others. Though labor costs are small in the assembling of final products, about 7%, many of the parts and chips used in Apple iPhones and others products are also Made in China and subject to rising labor costs too. Bottomline, Made in China means rising costs.
Original post June 19, 2010

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