MattMaroon.com

It was announced recently that HP was purchasing Palm. As both a customer and shareholder of Palm, I’m happy with this.  It was, quite probably, Palm’s least bad option.

I’ve had a Pre for almost a year now, and while I love it, and truly think WebOS is by far the best mobile OS on the market, I can see why Palm has had trouble with it. Their advertising strategy has been pretty awful, to put it mildly. They’ve taken some steps to change that recently, and I think their newer ads will work out much better, but it’s unclear if they could sustain themselves long enough for that to happen if they had remained independent.

They’ve also got to make some more appealing hardware. The Pre looks cheap and plasticy, and to some small extent feels that way too. HP might not be Apple, but they’re much better at building attractive hardware (when they try, which they often don’t) than most.

Palm made a seemingly enormous mistake in launching with Sprint. Their hardware had a pretty long technological lead on everyone else when it launched, but was about average by the time it got to the bigger carriers. Whatever Sprint gave them (in excess of what Verizon would have) it wasn’t worth it.

HP is getting a lot in this deal. They’re getting the most user- and developer-friendly mobile OS on the market. They’re getting the carrier relationships (biz-dev is the name of the game in the mobile space) and clearly some engineering talent.

On the other hand, I’m afraid they may be developing the “man with a hammer syndrome” if all of the stories about killing off the Windows 7 Slate are true.  While I love my Pre, I have no desire for a bigger, faster one. There’s just too much it can’t do, even at 3x the size.

I’d probably preorder a Windows 7 one. There’s just so much I can do on Windows 7, even on a device designed solely for casual use, that I cannot on an iPad or a comparable WebOS device. I can watch Hulu or play games. I can use Roboform to log into my zillions of web services without having to type passwords (and typing is the Achilles heel of virtual keypad devices, so anything that reduces it is going to be a big usability boon). I can use full-fledged Outlook or Trillian. I can use Dropbox and Windows Live Writer and VLC and uTorrent and play Chess on Yahoo. I can play Starcraft 2… ok maybe not. But you get the point.

The number of things I can do on a full Windows machine dwarfs even the iTunes App Store, which itself makes the WebOS one look flabby and weak. I don’t want an app store, I want good old fashioned programs. Apps suck, they just suck a little less than websites.

I don’t want or need a bigger, less convenient version of my phone, I want a smaller, more convenient version of my laptop. 

What sort of blogger would I be if I didn’t make a bunch of predictions for the next year that you could laugh at (some now, some in 11 months). Rather than making a bunch of vague statements that can’t even be evaluated a decade from now (I’m looking at you, The Economist) I’ll try to make right-or-wrong predictions so one of us will get to stick our tongue out at the other on New Year’s Eve.

Mobile

1. The iPhone will remain solely on AT&T, much to the chagrin of iPhone users. Android and Palm will gain market share as a result, probably more the former than the latter. Customers will continue, for the most part, choosing their carrier and then their phone as they’ve done since the industry began.

My reasoning behind this is that the only network that matters to Apple is Verizon, and Verizon won’t give them much of a deal. AT&T clings to the iPhone like a drowning man to a life raft. It’s all they’ve got, and they’ll give Apple all of the control they expect in return. I wouldn’t be surprised if Randall Stephenson is washing Steve Jobs’ car every Sunday.

Verizon won’t play that game because they know that in the long-term, that means irrelevance for them, and if there is one thing Verizon has shown all along it’s that they are the mobile network most capable of thinking long-term. If Apple wants to play on their playground, they’re going to have to follow the same rules as all the other kids, and Steve Jobs won’t ever let that happen.

Verizon has been growing their business just fine without the iPhone, and for the first time they’ve got solid competition (Droid, Storm [though I hate to call that hunk of junk competition, it sells] and soon the Pre) for the consumer smart phone space. They’re looking back to 2007 when they passed on the deal the first time because Apple wanted too much money and too much control and laughing about how right they were. AT&T might have gotten themselves the hottest phone on the market, but they got it at a price that hasn’t helped them stop the bleeding, and if anything has put them in worse shape than they were then. They’ve hemorrhaged customers even despite bringing in millions with the iPhone 3G, and Verizon has gained a big chunk of them.

(Everyone is also claiming that Verizon won’t do much to market the Pre because they want the Droid to be their iPhone. I don’t believe that either. Verizon wants the hardware companies competing tooth and nail. They didn’t want to be a king maker for Apple, but doing the same thing for Motorola wouldn’t be any better for VZW in the end. They’ll put their muscle behind a new phone every couple months just as they always have. The Pre and Pixi will be up to bat pretty soon, then it will be someone else’s turn at the plate.)

The only other network I could see the iPhone landing on is Sprint. They’re CDMA and therefore can roam on Verizon’s towers. They’re just big enough to matter (because really, what’s joining up with T-Mobile going to do for Apple?) but in a bad enough position that they might give Apple more than Verizon.

2. Palm will put out a successor to the Pre that does even better. I’m not talking about the rumored Pre Plus that will be launching on Verizon shortly, I mean a second generation. If you forced me to nail down features, I’d say video (which may be on the original by then), Flash (ditto), a better keyboard (I hope) and of course the obligatory more memory.

Their ease of development (already the easiest, and going to be even more so once Ares launches) will give them the highest app count to user base ratio, though that won’t count for much in the grand scheme of things because as anyone who actually has one of these phones knows, you only need one app that makes fart noises. The quality of an app catalog does not scale in direct proportion to quantity, in fact it’s more of a logarithm with a large base number.

WebOS will continue to be the best mobile OS, especially once it gets Flash, which will be the most popular feature ever to hit smart phones, but will still not eclipse the iPhone or Android in total sales yet. Hopefully for Palm’s sake they’ll ditch the creepy marketing campaign for one that works.

3. More Android units will ship that are highly-regarded and will land on every major carrier. 2010 might not be the year my prediction from 2008 comes true, but it might be the last where it doesn’t.

4. Apple will launch a tablet of some sort. It won’t be a roaring success like the iPhone 3G. It probably won’t even be anywhere near the middling success (or middling failure, depending on your point of view) of the original iPhone. It won’t be a total dud (Apple TV) either. Think along the lines of the Macbook Air.

Apple does product development as well as anybody though, maybe better. The original iPod sucked. So did the original iPhone. In both cases, Apple watched what users did, figured out what mattered and what didn’t, and successive generations got better and cheaper. So to make this clear, I’m speaking only of the first generation.

I would guess most people don’t want to carry a device around 24/7 unless it fits in their pocket. It will be a device for lounging around the house, but people already have notebooks and smart phones for that.

And if people have to have some sort of carrying case for a computing device whenever they leave, they’ll want a full-featured computing device, especially at any price point over $500 since you can get a reasonable notebook for that these days. It’s unclear to me what a tablet can do that an iPhone can’t, and what it can do as well as a notebook, let alone better than, while still remaining price-competitive.

I expect the tablet will be what the Kindle should have been. Apple will realize (as they always have) that nobody cares about battery life. They’ll deal with 5 hours if it means a color screen and the ability to watch video and surf the web. Apple will also realize that even a digital keyboard is better than that monstrosity on the Kindle, that Wi-Fi is better than Whispernet, and that a web browser is better than all of the books and magazines in the universe.

My guess is the product will have a 3G data card built in, cost $599 subsidized through a carrier with data service (which is why I’m putting this in mobile) and maybe $799 with no service contract. That will be way too much. I’m just spit-balling there though.

Web/Software

1. Facebook and Zynga will both IPO (their valuations will be very much tied together) and a previously thawed tech market will heat back up. Social games will continue to grow,and maybe get a second IPO from someone like Playdom, though not at the astounding pace they did in 2009.

2. Twitter won’t exactly fade back into obscurity, but it will garner fewer and fewer media mentions, and new users, as time goes on. It may end the year with fewer daily actives than when it started as people tire of the enforced inanity of a 140 character limit.

3. Application developers will slowly start to shift away from iPhone and Facebook to the good old-fashioned internet once again. The iPhone platform’s terrible distribution system will, despite insanely high RPUs, prevent the business case from being realized by developers. Facebook’s platform (which has great distribution but much lower RPU) will go through a rough patch with major changes that makes developers ask “why am I not just building this on a website again?”

4. Google Wave will gain virtually no traction at all. The DoJ will take firm action against Google for anti-trust violations.

5. Facebook’s growth will slow because there are only so many people on the net. Their revenue may hit $1 billion.]

6. Bing will gain a little market share, but not enough for Google to worry about. Most of it will come from Yahoo anyway.

Games

1. Pundits will finally realize that the real success story of the previous generation of consoles wasn’t the Wii, but the Xbox 360 (All gamers already realize this, pundits can’t see beyond unit sales.) just in time for rumors of the next generation to start circulating.

2. Starcraft 2 will finally launch, after years of teasers. It will be critically acclaimed and very popular, but not as popular as it could have been a year or two ago due to many former RTS players having moved on to MOBA games like DoTA and League of Legends.

3. Flash will come to mobile devices, sparking a massive upsurge in the casual games industry. The number of game apps on any mobile platform is trivial when compared to the number of Flash games out there.

That’s all I’ve got. Please tell me where and how I am wrong.

My vanity alert buzzed this week with a link to this forum thread (you may have to manually scroll to the top) quoting a bunch of people who said the iPhone would be a flop. Fanboys love nothing better than pointing out every time someone made a prediction about Apple failing, where it clearly succeeded.

The problem is that a large portion of the quotes were correct in context, including mine and Steve Ballmer’s. Mine, which came from this blog post, was:

“It’ll sell a couple million units to the many people who have wet dreams about Steve Jobs, and that will be about it.”

Matt Maroon, MattMaroon.com , 7 May 2007

and Ballmer’s was:

“Five hundred dollars? Fully subsidized, with a plan? It is the most expensive phone in the world and it doesn’t appeal to business customers because it doesn’t have a keyboard which makes it not a very good email machine…”

Steve Ballmer, Microsoft CEO, January 2007

Both quotes, as evidenced by the dates, were about the first iPhone, and both turned out to be correct.

When Apple first announced the iPhone they set a goal of selling 10 million units by the end of 2008, a goal they would never have made with the iPhone we were talking about. Both of our arguments centered on the pricing. If you read my blog post I specifically mention the pricing as the major issue in almost every paragraph.

Originally the unit wasn’t selling well at all. So Apple dropped the price a few weeks after it launched, pissing off the early adopters of course. Why? Because me and Steve Ballmer were correct.

Even after that price cut, it continued to underperform. Ballmer and I were more correct than even we knew. According to Apple’s own sales figures, the original iPhone sold only 6.1 million units in 5 quarters. When your sales target is 10 million units in 6 quarters, that’s about 27% below where you’re aiming, even with a price cut. I’m sorry, but that’s a flop.

Then, of course, things changed. Apple released the iPhone 3G, which was most definitely not a flop. The combination of a lower price, 3G speeds (which had become standard for smart phones nearly a year before the first iPhone launched) and, perhaps most importantly, the App Store did for the iPhone what the Nano did for the iPod. It’s now undeniably a success, in some ways even a game changer.

And that’s not really surprising to me, or probably to Ballmer (though he’s contractually obligated to never admit it) or most of the others quoted back then. It’s what they did with the iPod. The first of those were expensive and of extremely limited appeal too. Apple does product development just like everyone else, often better than everyone else (though they too have their Apple TVs) and they refined the iPod greatly over successive generations until they had a winner. They got there a bit faster with the iPhone, but they also had a lot more experience and a much larger ad budget to work with too.

But I think we’ve found a great test for fanboyism. If you relish in applying predictions about a $500-$600 device with no 3G and no app store to a device that costs $100-$300 and does have both 3G and an app store, you’re a fanboy. Or just someone with little capacity for logic. Either way, enjoy those dreams about Steve.

I’ve been talking to some people a bit about the internet advertising industry lately, and it’s occurred to me that many people even in the web industry have little or no understanding of how it works. To save myself the time of repeating it to each, because a lot of people may find it interesting, and because some of the topics I’ll be covering here in the very near future relate to it, I thought I’d write up a quick primer on the various terms, how they’re defined, and what they mean in practice.

Here are the basic terms, in logical order rather than alphabetical:

Ad Terms

Impression: This is what one view of one ad is called. Every time you see an ad anywhere, that’s one impression. A webpage with multiple banners might serve up one impression each for many different ads.

Publisher: The website displaying ads. The term is a holdover from the days of print marketing, but probably could use some updating nowadays. It’s a pretty big stretch to call the authors of most blogs or a social network "publishers".

CPM: Cost per 1,000 impressions (M being the Roman Numeral for 1,000). This is the amount a publisher gets paid to serve up 1,000 ads. For instance, I might purchase 1,000,000 impressions (1,000 times 1,000) of an ad on Facebook for 12 cents CPM, so my total bill would be 1,000 * .12, or $120.

CPC: Cost per click. Many ads are paid for only when someone actually clicks them, regardless of how many impressions are shown. This is very typical for ads on Google, Facebook, Myspace, and many other platforms. So if I pay Facebook 30 cents CPC to run my ad, and only one person clicks it, then it doesn’t matter whether they showed it once or one million times to get that one click, I still pay exactly 30 cents.

CTR: Clickthrough rate. The number of impressions of an ad that are clicked on by the viewer divided by the total number of impressions of that ad shown. If Facebook shows my ad 100 times, and 3 people click on it, that’s a CTR of

3/100 = .03

This is also sometimes expressed as a percentage (which in the above case would be 3%) but if so will need to be converted to a decimal for calculating eCPM, which I’ll get to after…

CPA: Cost per action. This is the amount of money an advertiser pays a publisher to drive one user who performs a certain action. For instance, suppose Netflix pays publishers $20 every time an ad banner on the publisher’s site gets Netflix one new member who signs up for a monthly service plan. Netflix is paying $20 CPA.

What constitutes an action is generally determined in advance by the advertiser, and in most cases involves a user purchasing something. (There’s also a similar method called CPL, or cost per lead, which I’ll ignore since it works about the same way but usually doesn’t necessitate a purchase.) This is a very common method of marking online through affiliate programs.

eCPM: The effective cost per 1,000 impressions. This is a useful metric when estimating the cost to run ads paid for by the CPC or CPA method rather than CPM. The formula for calculating it is:

eCPM = CPC * CTR * 1,000

or

eCPM = CPA * CTR * 1,000

So let’s say I’m paying Facebook 30 cents CPC, and I get a clickthrough rate of 1%, then I am effectively paying Facebook

$.30 * 0.01 * 1,000 = $3

eCPA: Effective cost per action. The effective amount an advertiser purchasing ads by any method other than CPA (for instance by CPC or CPM) pays for one action.

Ramifications

For publishers everything comes down to eCPM, for advertisers it all comes down to eCPA. Once you understand those two simple rules, the rest flows naturally.

Publishers have limited inventory (i.e. impressions) and want to maximize their profit, and the way to do that is to run the ads with the highest eCPMs. Even if the advertiser is paying by the CPC method, the smart publisher is automatically calculating which ads are paying the highest eCPM (which, remember, is CPC * CTR * 1,000) and displaying them first. (The same applies to CPA, but I’m going to continue just using CPC in my examples both for clarity and because it’s considerably more common among major ad platforms.)

Advertisers are all about maximizing the productivity of their ad budget. They seek to allocate their funds to the places that have the lowest eCPA. If that eCPA is less than the profit they make from the acquired customer, they’re making money. If not, they’re going to end up poorer.

So regardless of the tracking method used, every intelligent advertiser is looking at their eCPA, and every intelligent publisher their eCPM. This is why when I see ludicrous articles like this one about how we should stop using the CPM method (oddly by someone who formerly ran the Interactive Advertising Bureau and should know better) I laugh because the payment method is entirely irrelevant. It all boils down to the same thing in the end.

As an advertiser bidding by the CPC method, there are therefore a couple things you can do to maximize your profit. For one, you can pay more. If you double your CPC bid, you’re doubling the eCPM you’re paying the publishers, and therefore your ad will be significantly more likely to run. If your profit margin drops to half of what it was, but your volume quadruples, you come out a winner.

But since no advertiser is ever in a hurry to pay twice as much when there are other options available, it’s usually more common to focus on improving the CTR. Double your clickthrough rate and you’re paying the ad network twice the eCPM, however you’re still paying the same amount per click, while only using up half as much of the advertiser’s inventory. It’s a win-win for the advertiser and the network, which is why you’ll find a lot of helpful tips on the networks’ sites (and even frequently get contacts from staffers) on how to improve your CTR.

There are two very good ways to increase your CTR. One is to make your ad more appealing. Experiment with different images, sizes, and texts. This is both art and science, and time-intensive to boot, but it’s a powerful way to maximize your return on investment. If you are purchasing sufficient volume you can multivariate test the results of different ad texts pretty quickly.

Another common method of improving CTR is to improve your targeting. With search-based ads, such as those found on Google, find the keywords that convert best and most cheaply. On Facebook or Myspace, target users who fit your desired demographics and interests, and tailor your ads specifically toward the keywords being targeted.

So there you go. You now know everything you really need to know about how internet advertising functions at a basic level. There of course are thousands of little tips and tricks that people have collected over the years, some of which they’ve shared, many they’ve probably not. I’d recommend searching around for all of the advice you can find and then figuring out the rest through trial and error.

Everyone’s in an uproar about Apple’s rejecting the Google Voice app. My thoughts on that are pretty much “duh”. That’s Apple. That’s how they’ve always run their show. Always. If you make something on their very closed, very proprietary platform, it better be something they don’t feel competes with them in any way or they’re going to reject it. End of story.

They rejected an app that does nothing more than automatically download podcasts to your iPhone because they felt it competes with iTunes. How something that makes your iPhone, and only your iPhone, better could possibly compete with the iPhone I have no idea. But that’s Apple. They want you hitting up iTunes, and therefore being within a reasonable proximity of the iTunes store where you might pay them, as much as possible so they ban anything that might interfere with that.

Don’t get me wrong, that’s their right. I’m not one of those far-left idealists who has moral qualms with somebody trying to make a buck, so while I totally expect this sort of behavior from Apple, it doesn’t make angry at them. It does make me just a little more glad I got a Palm Pre instead. It does make me glad I’ve consistently chosen products (from mp3 players to cell phones) that optimize user experience over ones that want to lock me in and make money. It does make me laugh every time I hear one of their higher-ups talk about how they just want to make good products and don’t worry about making money, because just about everything they’ve done in the last decade has belied that. And it also does make me question the wisdom of blocking an app that makes your product better in the hopes that it will lead to someone spending an extra buck or two on songs.

But it doesn’t piss me off and it wouldn’t even if I owned an iPhone because I’m not dumb enough to expect anything else. It’s just Apple doing what Apple has always done. If you bought an iPhone you should have seen this sort of thing coming. To Steve Jobs, every customer is just a means to an end. People who love Apple products try their best to forget that and imagine Steve’s arms around them keeping them warm while they’re standing in line for the 3GS at 6 a.m., and then they get angry every time Cupertino does something like this and forces them to snap back to reality.

The reality is, of course, that Apple is in it for the money. Always has been too. They haven’t always been good at it, but they’ve always tried to make products that make money. If they make products that are “better” they only do so because it will make them more money than making ones that are not “better”. If you think they’re some sort of Prometheus bringing style down from Mount Olympus to mankind just to save us from our tasteless dictators in Redmond, you’re deluding yourself and you deserve the disappointment that inevitably follows time and time again.

Some people are blaming the whole fiasco on AT&T too, but that makes no sense to me. There’s a Google Voice app that runs on Blackberries, which AT&T hosts. And besides, what does AT&T have to lose? It doesn’t reduce in the slightest the number of AT&T minutes or text messages you use (and therefore buy). They’re most certainly going to pull the plug on anything that interferes with you paying them, but Google Voice doesn’t do that. In fact it might result in you paying them more.

But it does interfere with the iPhone, in the same way that the Podcaster app did. It’s got you replacing one iPhone function with a third party version that’s better. And unlike the Podcaster app, they couldn’t just toss that feature in at a later date and steamroll Google for having found itself on the wrong street in their product road map. So if you didn’t see this coming, you just haven’t been paying attention.

I was listening to Marketplace yesterday when I heard something that was so dumb that it offended me. It was an interview with a guy named Christopher Steiner, the full text of which can be found here, about his book $20 Per Gallon, which is about what will happen to society as gas prices rise. Some of the classics were:

at $6 per gallon Americans will abandon SUVs forever.

at $12 we’ll all start living in urban condos and walking everywhere, roads will start closing and many of the remaining ones will start charging tolls.

at $14 per gallon big box stores like Wal-Mart will go out of business.

There are so many things wrong with this. First is the notion that gasoline could somehow get to $20. It assumes proportional demand. India and China will make a bunch of gas guzzlers just like we have, and want to buy just as much gas as we do. Of course, almost nobody in either country can afford to pay what we do in gas, and virtually none will be able to pay $10 per gallon. At some point in oil’s meteoric price rise those estimates, which are likely based on today’s gasoline prices, will all fall off a cliff.

But supply and demand is nebulous and impossible to gauge, so let’s just fast forward to a future where he’s correct, and that however many billions of BRIC dwellers suddenly have cars and the GDP per capita to bid gas prices up considerably higher than they already do. Then we get to the real reason the whole argument is stupid, which is that it assumes humans will adapt to the changing prices of gas by radically changing our lifestyles rather than developing new technologies to mitigate the costs. That’s like saying we’ll stopping having casual sex because AIDS is spreading. Despite the almost endless list of times humans were faced with technological hurdles and overcame them, this notion might just be mildly misinformed, rather than borderline-retarded, if not for the fact that those new technologies are already here.

Take ethanol, for instance. There’s a lot of controversy about it now because of government subsidies and the fact that it’s actually more expensive than gasoline for the same level of output without them. Those are true and valid criticisms, but it’s not that much more expensive and it still has to be factored in when discussing future gas prices. Unsubsidized corn-based ethanol already puts an upper limit on the cost of gasoline of somewhere around $5-$7 per gallon, depending on where you get your numbers from, and that’s rapidly becoming an outdated technology. We’ve got thousands of scientists at work on new biomass sources and production methods, but even if you discount that all as pie-in-the-sky optimism, our currently available ethanol production will stop the ascent of gasoline prices long before all Lowe’s locations turn to ghost towns.

And then there’s the even more exciting technology, electricity. We’ve already got usable electric cars on the road, with more coming out every year. There’s the Tesla. There’s the Chevy Volt, which is expected to get 50-60mpg when running on gasoline alone. There’s the new plug-in Prius.

Electric cars aren’t quite ready for primetime yet, but they’re close. Battery technology, which seems to be the limiting reagent, is rapidly improving. Our power-grid couldn’t handle everyone driving plug-ins yet, but we already have smart grid technology that could and we’re in the process of rolling it out. A process that would be sped up greatly by gasoline hitting $10. Nuclear power can provide us nearly unlimited cheap electricity, which again would advance quickly with high gas prices.

All of the pieces are there, we just haven’t had sufficient motivation to pay for them yet. But given the choice between that and not driving our SUVs 30 miles to work every day, it’s pretty clear what the First World will choose.

I found this article a few minutes ago about the rumors of antitrust investigations around Google. Like most Libertarian hatchet jobs these days, it starts with a belief in an unproven set of first principles roughly equating The Market with a just and loving God, mixes in a total lack of understanding of a complex issue, and arrives at a useless conclusion.

The author doesn’t know the difference (and it’s significant) between AdSense and AdWords, which is the first clue as to how little he actually knows about this issue. I’m not even sure where I side on the Google antitrust topic, but I know it’s a hell of a lot less simple than “Google makes the best search engine and as soon as they stop the money will flow elsewhere.” Anyone who has actually used either of those two products (I’ve done both) knows this.

It’s not hard to find people (via Google searches no less) who were making a lot of money and then were effectively put out of business by a change in or sudden enforcement of the nebulous AdWords or AdSense terms, or in Google’s results algorithm. It’s clear to anyone sufficiently knowledgeable about internet marketing that Google’s tremendous share of searches gives them unprecedented control over the flow of advertising dollars on the net.

The author continues:

In other words, Google is to be shackled so that future competitors can catch up to Gmail, Google Maps and Google Books.

Google Books is undergoing a controversy of its own in relation to their settlement with the Authors Guild giving them and only them rights to sell orphaned books digitally, which has nothing to do with what the DoJ is rumored to be investigating. I’m not sure where I stand on that issue yet either, but one thing is for sure: it’s small potatoes compared to AdSense/AdWords and search engine results.

Gmail is in 4th place behind Yahoo, Microsoft, and AOL respectively, and Google Maps does well but has far more significant competition than their search or advertising products.

In summation, this guy has very little clue what he’s talking about, but that never stops a Libertarian from writing a negative opinion piece about the government.

Epstein is an analyst at the Ayn Rand Center for Individual Rights.

Shocker.

I have a new entry on the list of Web 2.0 words I wish would die: micro-transactions. Being in the virtual goods industry, I read a lot of publications about them and they constantly talk about micro-transactions and micropayments. (I’m only picking on TechCrunch with the links here because they’re the easiest and most visible, and they should know better, but it’s sadly pervasive.)

I’m tired of reading titles like “Zynga Pushing Nine Figures In Revenues Thanks To Micro-Transactions”. Micro-transactions implies they’re unusually small, or somehow different than all of the rest the millions of payments that occur on the internet every day. They’re not.

In fact, looking over the last roughly 4000 transactions we’ve received on our apps, the average transaction was $21.86. That’s not quite as high as Wal-Mart (~$56) or Amazon (~$54) are getting, but the markup is probably far in excess of theirs, and I’d actually be surprised if Zynga’s average payments are lower than ours.

But regardless, I hate being part of an industry whose success is routinely cited as proof that I and a bunch of other people are wrong about micropayments being largely worthless. If you define transactions ranging from $5 to $200 with an average of $20 as micropayments, then I guess we have to eat crow. If you define them in any sensible manner, then they’re still floundering.

I picked up a Palm Pre on Saturday, and have been playing with it quite a bit since. It’s already gone on a road trip with me, and I’ve pretty much put it through its paces at this point. Here are my thoughts, starting with the hardware.

The phone has a unique feel that some people love and some people hate. I mostly like it. People equate weight and metal with build quality, which is usually not entirely inaccurate in portable electronics, so I can see why some people are worried about durability. Time will tell, but I don’t get the feeling it will be a problem. It feels pretty well-assembled.

The body is all plastic and feels very smooth and very light. The opening of the keyboard is nicely spring-loaded. Overall it’s smaller than most other full touch-screen phones, and only a little thicker, so it feels a little more pocketable than anything else I’ve held.

The keypad isn’t as bad as I’d feared after reading many reviews, but it’s definitely no Blackberry. I prefer it to the virtual ones by a long shot (I can still type one handed without looking, something you’ll never do on a touch screen) and I got used to it enough to type relatively quickly after just a few minutes, but it does feel a little cramped. They keys are a little too small and too close together, and the top row is a little too close to the rest of the device. It’s not the deal breaker I’d feared at least, but I don’t think I’ll be able to type quite as fast as I could on my last few devices. I do really like the way the keyboard curves outward when dropped, to make the phone easier to hold when typing or talking.

On the other hand, the keys are very well laid out. You can hit the “@” and the “.” keys without having to shift into special character mode, a tremendous boon in this day and age for a web device. So many of the services you use ask you to log in with your email address, so it’s very useful to be able to type it quickly and easily. Shifting into caps or special characters is as easy as it gets on a mobile device too, and Palm puts a nice little symbol under the cursor to make it easy to spot which typing mode you’re in.

Like most Palms, they threw in the awesome volume switch on the top of the phone. That was the biggest feature I’ve missed over the last few years since moving away from the Treo. There’s a standard-sized headphone jack up there too (nothing more annoying than when phones put them on the bottom) so there’s no need for special headphones or goofy adapters to listen to your tunes. It’s now replaced my iPod Nano for listening to audio books and podcasts on the way to/from work.

The speakerphone on the back has reasonable volume. The camera is a 3.2 megapixel that takes very good pictures, and comes with a flash that can be turned on, off, or left on auto. The volume and power buttons have just the right balance of protruding enough so that you can feel them while being small enough that you won’t bump them on accident.

One gripe with the hardware is the chintzy little door to the micro USB connector. It doesn’t sound like much, but that connector is both the phone’s charging port and of course its connector to your computer. If that door falls off and some little piece of whatever from your pocket gets in there you might have a real problem, and that feels like a distinct possibility. Palm really should have thought that one through a little more.

The capacitive touch screen is stunning, and the gesture area with one button below it may be my favorite invention of all time. It makes it easy to navigate without accidentally bumping links and buttons in web pages and apps. The screen has a nice feel to it too. I hear tell that it’s incredibly scratch resistant, but that’s the sort of thing I’m not inclined to find out for myself. It’s spent a little time in a pocket with some keys and come out unscathed, but not much.

Technically this one is software, but it fits here so I’ll mention it. One brilliant feature I haven’t seen on other touch screens is the little ripple that appears whenever you tap it so you know exactly where you pressed. It looks the ripple you see in water when a drop falls in. With any touch screen you sometimes have the experience of missing something you meant to click, and with the Pre you at least know exactly why.

The biggest hardware flaw, however, is the battery life. It’s bad. I remember, when the iPhone 3G came out, Mike Arrington saying something about how he was willing to strategically place chargers (presumably in his home, office, car, etc.) to get through the day because the phone was so good it’s worth it. I thought he was nuts at the time, but now I understand.

With heavy use of non-phone functions you’re not going to get through a whole day, especially if you have Wi-Fi, Bluetooth, and AOL Instant Messenger (AIM) on. In fact AIM has some sort of bug that causes it to drain battery life rapidly (though that seems like it may have been fixed with the latest OS update) so you have to be careful not to leave it on when you’re not using it. With all wireless protocols running, multiple apps in use and continuous web-surfing I’d say you’ve got about 3 hours on a full battery. I wish they had built in some way of at least intelligently cycling Wi-Fi off when you’re away from known networks, or turning AIM off after a certain amount of inactivity, or something of that nature, but they don’t seem to so you’ll have to do it manually.

The Wi-Fi antenna seems pretty solid, usually getting as many bars as my desktop. The GPS chip is reasonably fast for a phone too, which is nice when checking the weather or using Google Maps. I don’t think I’d want to use it for turn-by-turn directions, though it does come pre-loaded with that, but then I’m probably spoiled by my car’s built-in GPS.

For talking the device seems solid. I’ve only used it a little, but it’s worked perfectly. I was a Sprint customer for a long time previously, so I know their network is great (especially since you can roam on Verizon’s if needed). The entire rest of the world is blanketed in GSM, but for some reason the CDMA carriers own the US. It’s our technological equivalent of the metric system I suppose.

I would have appreciated a little extra volume in the phone’s speaker, but I was able to hear my aunt on the streets of Detroit, so it definitely isn’t bad. I don’t think it’s a phone I would recommend to the hard of hearing though, unless they were prepared to use a headset.

The Pre uses one of the most powerful processors ever put in a mobile device, and it feels like it. The loading times on most things are comparable to opening light to medium weight apps on your desktop computer. The whole system has an overall responsiveness that is truly impressive and friends who own the current iteration of the iPhone noticed a serious difference. I don’t know anyone with an Android unit handy to compare to, but it beats all the other phones I’ve tried by a wide margin.

So overall I’d give the hardware a 7.5 out of 10. The unit feels durable enough that I’m not too afraid of dropping it. It’s got a user replaceable battery (and I never go more than a year without doing so) which I consider a huge benefit, especially for a device that’s such a power hog. I plan on ordering a backup to carry with me when travelling and such. But the keyboard is cramped and the default battery inadequate, which keeps me away from giving it a higher mark.

If the hardware is a bit rough, the software is a perfect 10. Seriously, there’s truly nothing like it out there yet. WebOS is an engineering and usability marvel, such that I almost don’t know where to begin when describing it. I’ll start with the most basic feature, contacts.

WebOS uses what Palm calls Synergy. The idea behind Synergy is that you have little pieces of your life scattered across a number of places. Your phone has the names and numbers of most of your closest friends and family. Your Gmail or Outlook or Exchange Server account has scores of email addresses. AIM has instant messenger names and Facebook has all sorts of data, including pictures, depending on the privacy preferences of your friends there.

Synergy goes ahead and intelligently rolls them into one place in your phone. You give it your credentials (in my case, I use Gmail for personal emails, Exchange Server for work, AIM and Facebook.) Now you’ve got a contact card for everybody, and where it can it combines them into one. For instance if I search for my cofounder John Marks, who has an entry in every one of those accounts, it shows me one contact card that contains his AIM, Google Talk/Gmail, email addresses, physical address, phone number, his Facebook picture, etc. Every bit of data from every site is automatically lumped together into one contact. It does a very good job of this, and in the instances where it fails to combine contacts (usually an AIM account) it’s very easy to do manually. I have a lot of contacts and it took me maybe 15 minutes of work to get them all squared away. Without Synergy doing all of that would have taken days.

Synergy is also useful for IM and SMS, where it rolls the two together into one threaded conversation. So whether John texts or IMs me, I’ll see them in the same place, and automatically respond via the same protocol. I can view Buddies or Conversations in the Messaging app.

Email accounts are handled similarly. The Pre of course supports Active Sync, and it also supports IMAP IDLE, which means I can get emails from both my Exchange Server and Gmail pushed to me as soon as I receive them, rather than periodically polling. In the mail client, I have a combined inbox, but can also view the accounts separately and dig through subfolders.

Email is only missing one major feature, which is search. For some reason they left emails out of the Universal Search feature. With that and a better keyboard the Pre would be the best email device ever made, and I expect Palm to introduce both in future models and OS versions.

Which brings me to the next feature, Universal Search. Just start typing on the Pre home page and Universal Search takes over. It filters through your contacts and applications, showing you any applicable results, and if there are none it brings up a few buttons that let you easily search Google, Maps, Wikipedia, or Twitter with one press. It’s a brilliant feature for a web-enabled device, and makes using it a little more fun.

The web browser is nearly identical to that of the iPhone, right down to the pinching to zoom. They say good artists copy and great artists steal. If that’s the case, Palm is basically Pablo Picasso when it comes to the browser. They lifted everything right down to the double tapping to zoom into a div. They even stole the multi-touch gestures, patents be damned.

All of the above is tied together beautifully by the “deck of cards” metaphor. That’s something unique to WebOS, and within 15 minutes of using it you realize you could never go back. The rest of the features are available (if maybe not implemented as well) on other high end smart phones like the iPhone or G1 or, like Synergy, they’re really lovable but that you could work around with enough effort or simply do without. The easy and intuitive multi-tasking, however, is a new necessity.

Palm treats every phone function as an app. Calling, messaging, email, music, everything. It’s all its own app, and each app resides in its own card. Switching through cards is like riffling through a deck, you press a button or swipe upward from the gesture area to get into your home view, where you see them all shrunk down. Background apps are continuously running, and you can see them all changing in real time. Then you simply flick through them side-to-side. When you want to close an app you flick it upwards. You can even reorder them in the deck, though I never find that necessary.

The ability to multitask so well is the phone’s money shot. A recent example would be me listening to music from the music app, while reading news in the New York Times app. Then I got a call, so my music automatically paused and the phone app came up. After I finished the call, I closed the phone app and the music started again, then I flipped back to NYT and got back to reading. I could have read the news while talking too, but I probably wouldn’t be much of a conversationalist that way.

Palm also has a great system of notifications, so when an out-of-focus app has something important to tell you (for instance, an incoming email or SMS) they pop up at the bottom briefly, then disappear and leave a little icon behind for easy access. They strike the perfect balance, being simultaneously noticeable and unobtrusive.

The Launcher, where all of your apps are, is very well done. It shows 9 at a time, and you can easily add any webpage to it. I added Google Reader and Yahoo News. It even lets you easily make thumbnails from their page. You can reorder the apps, and swipe through pages in the launcher similar to swiping through running apps in home view. Personally I’m finding it easiest to put my top 9 apps on the Launcher’s start page, and simply use Universal Search to get to anything else.

The included apps are nice. It comes with a YouTube app, though I haven’t used it much so I can’t really say anything about it other than it works. You can search YouTube for anything, or view popular videos just like you could on YouTube.com. There are music and video players which are rather Spartan for sure but get the job done. You won’t mistake the Pre for an iPod, but it does most of the stuff an iPod does, and comes with about the same storage as a Nano, so for a lot of people it will obviate the need for a standalone mp3 player. You can also purchase tunes directly through Amazon if you’re so inclined, but really, who actually pays for music anymore?

There’s Calendaring, Tasks, and all of the other little frills you expect in a smart phone these days, but the killer app is probably Google Maps, which works with your GPS chip to make it easy to find nearby businesses and get directions. There’s also a memos app that lets you make little sticky notes, a clock app (that doesn’t ship with the phone but installs when you upgrade the OS) a calculator, Sprint TV and some Sprint NECKCAR thing, and some other frills I haven’t really explored much. The built in IM client in the Messaging app that uses AIM and Google Talk is great, if a battery hog.

Over time the App Store will presumably be where you’ll go to extend your phone. Right now it’s rather sparse, with just a handful of apps. There’s a good weather app, a New York Times and an AP app that gives you the news in an ideal format. The ubiquitous Pandora is there of course. There are some other things, mostly location-based services that all blend together into one big pile of “who cares?”, but the platform is still clearly in its infancy. The ease of development though, and the speed at which the phone sold out on launch day, make me think it will become at least the second biggest app platform in a relatively short amount of time. It’s got quite a mountain to climb to get to the top, but I’m betting a chunk of my IRA on the fact that it will get there.

The help application is also fantastic. The overall OS is so intuitive that you can figure out how to do most things on your own, but whenever you get stuck, there’s the help app. It does an awesome job of telling you how to customize the phone as much as possible. I’ve searched through it quite a bit and it’s very extensive. It turns out most of the stuff I couldn’t figure out how to do just can’t be done.

Which brings me to my one major gripe with the OS, the lack of customization. Some of the apps have preferences pages, but there’s generally very little there. I feel like the OS is a little dictatorial. I can’t, for instance, remove Twitter from universal search, or add Google News instead. I can’t set AIM to turn itself off after a half hour of inactivity. I can’t do a lot of little things I’d like to be able to. I realize there’s a balancing act there for sure, but I feel like Palm could have put a lot more customizability in there without detracting from usability or intuitiveness. I’m hoping future updates fix this.

But overall I’m betting that Palm and WebOS have a very bright future. There are some serious limitations so far on the hardware, but for a first release they did a magnificent job. On the software end, they have a significant lead over everybody right now. Going forward, they need to do a good job of courting developers to the app store. They also should open up the SDK a little more to some of the lower-level parts of the phone to widen the range of what app developers can make, while leaving the simplicity of development they currently have available. Right now graphics-intensive games like many of the ones running on the iPhone are basically out of bounds, but you could build a simple app in about the same time you could on the web, which is pretty exciting.

I can’t wait to see where they go from here.

I’ve been seeing more and more lately of what I call "Hacker News Disease". It’s a pervasive mental illness that has caused me to severely reduce my participation there and remove some of the major tech blogs from my list of daily "must reads".

In fairness, this particular problem isn’t by any means endemic to Hacker News. It occurs at the crossroads where a bunch of smart people meet general tech industry discussion. I’m sure there are plenty of places that suffer from Hacker News Disease (and they probably had it first, have a terminal case of it, and are much less civil about it too) but HN is just the only one I’ve participated in, so they have the misfortune of being the community I’ve named it after.

The disease has two primary symptoms:

1. Repeatedly mistaking intelligence for knowledge.

2. The belief that anybody not in the tech industry is stupid.

The first part is endemic to all smart people (but no brilliant ones). People tend to overvalue the skills they have, and undervalue the ones they don’t. Even the most knowledgeable, intelligent people around are rarely experts in more than one or maybe two unrelated subject areas. The sum of human knowledge is vast, and while smart people often believe they could become an expert in any of them individually if they only had the time and inclination, the relatively short number of years we have on this planet precludes them from mastering more than a very small portion of them. So smart people have a lot of intelligence, but still only a tiny amount of knowledge, which causes them to overvalue the former at the expense of the latter.

The tech industry, however, overlaps with just about every subject area known to man on a daily basis. Follow a handful of the better tech publications and topics such as law, politics, entertainment, economics, biology, real estate, sales, design, and psychology are just a few that pop up every time you open your RSS reader. It’s hard to find a sizable industry that hasn’t been drastically altered by the technological advances of the last twenty years, or won’t be by the next twenty either, so it’s not at all surprising that the people in the industry like to talk about those changes as they progress.

The problem comes when people don’t know what they don’t know. I can’t tell you how many times I’ve seen someone post a legal question on Hacker News, and get dozens of replies from people who aren’t attorneys. They feel qualified to have an opinion because they’re smart, and lots of the tech articles they read have a legal slant to them, and I guess it’s easy to mistake TechCrunch for education. The fact that they’ve never taken even an introductory law class doesn’t stop them from assuming they’ve got it figured out enough to offer advice.

The same happens in every field imaginable, to the point where I almost wish the site made everyone post verified credentials just so that if anyone with actual knowledge ever responded to a question, you’d be able to filter that signal out from the overpowering noise. Generally what happens though is I click on the commenters’ profiles a few times just to find they’re some 20 year-old programmer working on a new website for people to share music and then I give up.

"The wise man knows he doesn’t know. The fool doesn’t know he doesn’t know."

-(Lao Tzu)

In and of itself this wouldn’t be insidious, because at least the fools are well-meaning, and usually polite too. People mostly don’t offer psychological or legal or health advice over the internet in an attempt to do harm. They mean to help, and they simply don’t realize that harm (and little good) could come of it.

The problem is where it intersects with the second symptom, which is the belief that everyone not in the tech industry is stupid. This is pervasive in the tech media, and in the industry as a whole. A hundred times each day you come across someone saying that "These record label execs are suing people! They’re idiots and they just don’t get it." Or "These newspaper editors are trying to charge for online content! They’re idiots and they just don’t get it." Or "These clowns from Fox and NBC who run Hulu don’t want their videos showing up on Boxee! They’re idiots and they just don’t get it". Or "Warner is picking a fight with Lawrence Lessig? What are they, idiots?"

It never seems to occur to anyone that perhaps the people they think are stupid really aren’t, and perhaps (in reality, almost for certain) the people being commented about are just as smart as and know far more about the situation than the ones doing the commenting.

You can see an example of the last one if you click the link above. While I’ve been thinking of this post for months, it took me staying home sick for a bit to actually use the site enough to inspire me, and then give me the time to write it. In the thread, people who aren’t IP lawyers argue the finer points of fair use, and assert that Warner is nuts for messing with Lessig. The following scenario never seems to occur to any of them, and they even balk at it when it’s mentioned:

1. Warner has an army of highly paid, very smart and very knowledgeable IP attorneys, who all know way more about the situation than anyone who has ever even seen Hacker News, because while the people on Hacker News were studying programming, the equally smart Warner attorneys were studying intellectual property law and working on high-profile IP law cases.

2. Said attorneys (all of whom know exactly who Lawrence Lessig is, and are more familiar with his work than anyone on Hacker News) carefully examined the case, and decided for whatever reason to issue a DMCA take down notice which, by the way, is not a lawsuit, or even remotely close to one, and was issued to YouTube rather than Lessig, though you’d quickly lose sight of those facts when reading anything written about the whole affair.

3. It occurred to the attorneys that Lessig would fight this, because anyone who has ever read anything by Lessig would know that, and as I mentioned before, the attorneys in question are not retarded. Thus they issued the takedown notice because they wanted him to fight it, or at least don’t really care if he does.

4. Because they’re smart lawyers, who are experts on IP law (because that’s their job) and who issued a takedown notice to Lawrence Lessig that they wanted and expected him to fight, there’s a strong chance Warner has something serious to gain from it.

Now I’m not saying any of that is the case. For all I know, this was all just done by some automated software or a low-level grunt whose job it is to find Warner IP on YouTube and issue takedown notices, in which case it will likely blow over and isn’t worth discussing in the first place. Lessig might appeal the takedown, at which point an actual attorney might review it and decide whether or not it’s important enough for them to worry about. I really have no idea there.

But it’s also possible they’re looking for a fight, and if they are, you can be 100% sure it’s because they understand what they’re getting into and think they can win it. And if they think they can win it, there’s a good chance they’re right because they aren’t stupid. In fact they’re probably very bright, and they are very knowledgeable about and experienced in the subject area. If I had to bet on one side or the other, I’d bet on them.

That never occurred to a single person in the entire tech industry though, because they think anyone who can’t code an iPhone app, or doesn’t at least have the common sense to work mostly with people who can, is an idiot. So they go off spouting about how "Not Smart" Warner is, or how they’re in danger of setting some sort of shooting themselves in the foot "if they lose, which I think they will despite my not being a lawyer". It never occurs to them that the people who are a lawyer might be a little better at making that judgment, or even that not being a lawyer might make you a fool for even having an opinion on intricate legal matters such as who would win a case about Fair Use.

In some cases, I think the belief in the stupidity of people in other industries comes from a fundamental misunderstanding of the way in which people are compensated and therefore motivated. Take, for instance, the most flagrant example of this in recent years: the music industry. Over the last decade, they’ve fought technology tooth and nail, despite the fact that any teenager in 1999 could tell you it was a losing battle. It’s easy to look at what appears to be people tilting at windmills and see stupidity, but what you realize if you dig a little deeper is that they’re largely just intelligent people reacting in a rational manner to their own incentives.

Suppose you’re the CEO of a publicly traded record label circa 2000 and Napster is taking off. You realize that P2P file sharing is going to make a big dent in your sales increasingly over the next decade. What do you do?

You have two options. Behind door number one is fundamentally restructuring your entire company. Remember, this is still years before the iPod achieved the sort of ubiquity that led to the iTunes store and eventual copycats, so at this point, there doesn’t seem to be any real hope of long-term music sales. The CD is plainly marked for extinction, to be replaced by digital downloads, most of which will be traded from one person to another for free. You can see right away that revenues are going to have to come from something else down the line, like product placement in music videos, live performances, etc. You don’t know what you’ll be making money off of in 10 or 20 years, or how much, or even if you’ll be able to make any at all, because really you’re nothing but a middleman between the artist and the fans and maybe, just maybe, the internet is going to cut you out the way it did to computer retailers when Dell took over that industry.

Or you can sue every corporation that tries to get in on the P2P game, which won’t save you the end, but will definitely disorganize the community enough to staunch the bleeding for awhile, possibly a long while. (It’s actually done far better than most of us ever would have guessed.) You’re not stupid; you know that every time you obliterate one Napster another Kazaa will just pop up in its place, but between suing each one out of business and scaring customers by suing a few of them too, you’ll at least be able to hang on to something for a while.

And hell, the average tenure of an executive at a large corporation is only 5 or 6 years and you’ve already been on the job for two. You’re getting paid a huge salary with tons of stock options that vest over a relatively short period (such as 2 or 3 years) with a strike price low enough that your shares can slowly sink and you’ll still make millions for as long as you keep your board happy enough to not fire you, which you’ll do by pointing out that despite millions more people stealing your product daily, you’re still bringing in almost as much money as you did last year, and if you can just have a little more time you’ll sue your way back to revenue growth.

So what do you do? Do you destroy your major source of revenue, that’s brining in hundreds of millions of dollars annually, because you realize it’s going to die one way or another in the next 10-20 years and you might as well get on with it, and then start giving away the music for free and scrounging for ways to monetize in the hopes that some time, long after you’ve moved on to run a car company or a retail chain, your record label will be the one left standing? Or do you use your legal muscle to keep revenues as high as you can for as long as you can and keep collecting your multi-million-dollar salary and options package while doing lines off of naked starlets on the weekends before you move on to run a car company or a retail chain?

When you look at it from that perspective, it’s a no-brainer. You sue everyone and everything you can. If a 65 year old woman’s grandson downloads a CD of songs from Sesame Street on her computer, you sue her, sue the kid who spawned the little bastard, take the grandkid to juvenile court, and sue everyone on their block just for being within a reasonable proximity. Then you have your PR department spread the word that file sharing is illegal and if you do it, or ever even shake hands with anyone who did, we’re going to take your retirement, your house, your car, and even your $3 Timex wristwatch just like we did to this little old lady, and you’ll be spending your golden years working a second job at McDonald’s just to pay off what you owe us, all because you just had to have that Britney Spears CD but couldn’t pay $9.99 for it like a good law-abiding citizen.

That’s what they did, and it’s what I’d do too, and I have standardized tests to prove that I’m at least not an idiot. But everyone in the tech industry just assumes they’re stupid and they don’t get it. They’re not, and they do. It’s just that they don’t get paid to get it. Getting it isn’t what pays the mortgage on a $20 million mansion in Beverly Hills and the lease on a yacht. The job of getting it and actually doing something about it will fall to the next guy.

And now, a decade later, the next guys are taking over the record labels, TV networks, and movie studios, and we’re seeing things like Last.fm and Hulu and 360 degree music contracts which I said were going to be the future of that industry a year before anyone else. They’re adapting to the changing situation because the new guys, unlike the old ones, get paid for that. Their market caps are sinking faster than their boards can reprice the executives’ options, and the investors finally realize that all of the king’s lawyers can’t put Humpty Dumpty back together again, so they have to be patient and plan for the long term. And that restructuring is what we’re seeing now.

Everyone on both sides of the coin wants to work this out, because there’s enough gold there for all of us. But for those of us in the tech industry, if we’re going to get there we’re going to have to realize that they’re smart too, and they know things we don’t, just as we know things they don’t. We have to work together, and leverage their knowledge of how to produce quality content, which they do better than anyone in the world, with our knowledge of how to package it up and deliver it to consumers in the most appealing manner.

And when Hulu says they don’t want their content appearing on Boxee, or Warner issues a take down notice, or the RIAA sues our favorite music startup, instead of calling them idiots and assuming they’re out of touch with their customers and the changing world they live in, we should realize they have smart, knowledgeable people who know much that we don’t putting a lot of thought into what they’re doing, ask why, and see if we can find a workable compromise.

It’s going to be a long, bumpy road, and some of the industries (like music) that are struggling to keep up with the times will probably fare much better than others (like newspapers) in the end. We in the tech industry will do our best to step up and fill the gap, and try to make it work for everyone, but to do it well we’re going to have to stop assuming that everyone else is stupid and doesn’t get it. We’re going to have to inoculate ourselves against Hacker News Disease and work on meaningful solutions together.