Category: Web/Tech
The blogosphere as a spontaneous order
Read Jonathan Wilde’s insightful analysis of how blogs serve as an unplanned order, a’ la Hayek. Lynne Kiesling offers excellent commentary and further links.
A Bit of Talmudic Commentary
The Wall Street Journal’s David Wessel featured Marginal Revolution as one of the five best econ blogs/web sites. Wessel cited our wide ranging interests accompanied by bits of “Talmudic commentary.” Brad DeLong, Stephen Roach, John Makin, and Venture Blog were also cited. Welcome to all the new WSJ readers!
Will the FCC regulate Internet phone calls?
Hearings start today, here is the full story. A month ago a Federal court ruled that state governments may not regulate such calls. And the FCC traditionally has left the Internet alone. Nonetheless long-distance service over the Internet costs only a fraction of most calling plans, which threatens both telecommunications companies and government revenues from long-distance calls.
The problem has arisen, in part, because of previous regulatory decisions, most specifically access fees:
Long-distance companies now pay local companies $25 billion a year in “access charges.” The fees cover the cost of connecting long-distance customers to the local network. The long-distance companies argue they should not have to pay access charges for calls that travel over the Internet.
In other words, Internet calling is cheaper in part because the calling services do not have to pay access fees to the long distance network. Over time we can expect such accees fees to fall apart, they will prove to be neither a political nor an economic equilibrium. Here is what one industry spokesman predicts:
Nortel Networks, the Canadian telecommunications equipment maker, estimates that local telephone companies could cut their costs of running a network by 30 percent by shifting to a Internet-based network. Nortel also contends that carriers can cut their capital investment costs by 50 percent. “The market is absolutely moving in the direction of the convergence of these networks,” said Martha Bejar, president of carrier solutions at Nortel.
The bottom line: Competition will become more intense, calling will continue to become cheaper, but the long-run problem of paying for the telecommunications network will become more severe.
Buy, Eye in the Sky
For those who have nearly everything and can afford more, you can now buy your own space mission (on Ebay naturally). The offer, from SpaceDev, a real firm that sells micro-satellites, does not appear to be a hoax. Although, like space tourism, this is obviously in the early stages and something of publicity stunt it is also another important step towards the private exploration of space. For more on the offer see this item in Wired News.
What is the fair use doctrine?
Wired.com offers this very brief and useful summary, thanks to Geekpress.com for the pointer. This is the best simple statement I have seen of what “fair use” is all about. Note that the fair use doctrine will increase in importance, as companies put up tougher gates around their intellectual property. Bloggers must know about fair use as well, lest they quote too freely from copyrighted material and incur legal penalties.
For this economist, the courts aren’t nearly liberal enough in interpreting fair use. I think, for instance, that rappers should be able to sample songs without clearing copyright, at least provided they are doing more than simply copying large blocks of the song verbatim. Read Robert Christgau’s account of the famous Gilbert O’Sullivan case; O’Sullivan objected when rapper Biz Markie sampled his “Alone Again, Naturally,” a transformative use if I ever heard one. Will more sampling make rap better and cheaper? Yes. Will it diminish the supply of sample-ready material? Unlikely. So why not interpret fair use more liberally in this regard?
The new replacement for Google?
A news-gathering web site that tailors the stories selected to individual users is being tested by Microsoft. Once MSN Newsbot is fully functional, Microsoft says the site will personalise results within 10 minutes of a user starting to browse.
If successful, the site is likely to be a direct rival to the highly popular Google News, which clusters information from over 4000 news sources according to topics but does not customise results.
For the full story, read here.
How might such a service work? One possible algorithm follows the Amazon.com model, and compares the user to what previous like-minded users have been looking for. But if I could ask for one improvement, it would not be this. My searches are so wide-ranging, so strange, and so eclectic, I am perhaps immodest enough to think I have few useful doppelgaenger [“doubles,” roughly, from the German] in this regard. I would prefer the ability to type in questions, often of a conceptual or abstract nature, and receive a ranking of relevant web sites. In short, a better version of askjeeves.com would be most likely to draw my loyalties away from google.
Game I, man vs. machine
It is a draw, here is one account, here is a link to the moves and other background. Kasparov had a clear edge, in my view, but was unable to convert his position into victory. The computer played its typical perfect defense and Kasparov’s advantage slipped away entirely. They then settled for a draw by perpetual check.
Bottom line: This has to be heartening to the computer fans. Kasparov can’t expect many better chances to win. Three more games to go, and now the computer has white.
Addendum: Here is an easier link to the moves, with quality analysis. I would have played 21. Q x c6, more resilient than it looks, instead of Kasparov’s 21. Ng3.
Microsoft hires bounty hunters
Microsoft has put up “two $250,000 rewards, a total of $500,000, for information that leads to the arrest of the writers of two nasty computer worms — the Blaster worm and SoBig.” I am all for this as those guys sure wasted some of my time. As regular readers will know, I am also a fan of bounty hunters (see my earlier post; and my econometric paper – finding that bounty hunters reduce failure to appear rates and bring back fugitives much more succesfully than the public police).
Don’t stop at Google
Here are thirty useful Internet search tips, as pointed out by Brad DeLong, channeling Elizabeth Lane Lawley, who is in turn channeling Mary Ellen Bates.
My favorite idea is number 17:
Use Teoma.com to identify experts’ sites, link-rich pages. (Look at “resources” section on results page; these are “link-rich” sites on your topic.)
And let’s not forget the last suggestion:
Some searches are simply not meant to be done online.
Lynne Kiesling has moved house
Here is her new blog address, the simpler www.knowledgeproblem.com. Lynne is one of the smartest and most articulate bloggers out there. Her basic focuii are energy, electricity, environment, telecom, and infrastructure more generally, but she covers many areas of interest. Here is one of her recent posts about the FCC and media deregulation.
Speaking of the FCC, I was quite taken by this quotation from Clay Shirky:
Yesterday, the FCC adjusted the restrictions on media ownership, allowing newspapers to own TV stations, and raising the ownership limitations on broadcast TV networks by 10%, to 45% from 35%. It’s not clear whether the effects of the ruling will be catastrophic or relatively unimportant, and there are smart people on both sides of that question. It is also unclear what effect the internet had on the FCC’s ruling, or what role it will play now.
What is clear, however, is a lesson from the weblog world: inequality is a natural component of media. For people arguing about an ideal media landscape, the tradeoffs are clear: Diverse. Free. Equal. Pick two.
I’ll jettison equal. I’d rather have the chance to learn from Lynne’s blog, whether or not it has the drawing power of network television. And on the numerical comparison, well, we can only keep our fingers crossed.
Marginal Revolution Milestone
Yesterday we breached 10,000 visitors for the first time. Keep coming – you are in good company!
Thank you all for reading
Alex told me that today we broke 10,000 readers for the first time! Many thanks to you all for reading, and for your feedback and ideas. I’ve found blogging to be an enormously rewarding experience.
My favorite article on blogs, by the way, is this piece by Clay Shirky. It tells me, among other things, that I shouldn’t expect to make any money blogging. No problem, and I look forward to writing tomorrow’s posts.
Has Google peaked?
The economic theory of adverse selection suggests that we should be suspicious when companies go public. Here is a summary of some research on the topic. If your big idea has such a stunning future, why let other people in on the action?
Google.com will be going public, and John Gapper at The Financial Times has his doubts. Are they trying to cash out at their peak? Here is part of his critique:
The more pertinent question is whether its business model will retain the lead. To start with, it can no longer rely on others failing to grasp the importance of search. Algorithmic search engines are tough to design and maintain but others such as Teoma, owned by Ask Jeeves, and Yahoo’s Inktomi are catching up.
So is Microsoft, which is developing an algorithmic search engine that may be launched by spring next year – the likely time of Google’s IPO. By 2006, it will be bundled into the next generation of Windows – Microsoft’s usual tactic when faced with superior technology owned by others.
The biggest uncertainty is whether its focus on internet searches to the exclusion of anything else will remain the best strategy. Although it has clearly been popular so far – Google performs 200m searches a day and is responsible for an estimated 75 per cent of all referrals to websites – it could become an Achilles’ heel. It means that Google has no unique content, and no long-term customer relationship with the individuals who use its technology; it is only as good as its last search. That contrasts with sites that have their own databases and customer networks, such as Yahoo, with its 100m registered users, or Amazon, which holds a mass of data about the products that it sells.
The difficulty for Google will come as rivals combine search with other resources in ways that it will find hard to match. The launch of Amazon’s “Search Inside the Book”, which allows customers to search pages on its database for references and information, is one example of how search technology can be applied to data within internet sites.
Yahoo is augmenting internet search with its own information. Its Yahoo Shopping service not only allows users to search for the cheapest outlet for different models of digital cameras but also combines the results with its own guide to buying cameras, and with user reviews. Google’s own shopping service, known as Froogle, also displays the cheapest prices but looks flat by comparison.
My take: I’m not buying any shares. My understanding of the technical issues is weak. But I understand the theory of adverse selection pretty well.
Thanks Lloyd!
Many thanks to Lloyd Cohen for guest blogging with us last week. Stay tuned to this spot for more guest bloggers!
Blogs make media more personal
Personality is a key reason why blogs will continue to gain readers. Consider this:
Media was institutional. Now it is personal.
By personalizing media, I don’t mean customizing it (My Yahoo, Your Yahoo, All God’s Children Got Yahoos).
I mean humanizing it, taking on the personalities of people, not of institutions. Consider:
: The success of FoxNews can be attributed to the rise of the personalities and opinions of its anchors…People magazine personalized all news, for now every story has a People angle. I was at the magazine at this tipping point. Once was, a big TV show on the cover yielded big sales. That ended with the remote control and its revolution of choice. The institution — the show — no longer mattered. Now what sold was the event in the star’s life. It was personal. And soon, it wasn’t just entertainment but news of any sort that got that treatment in People and everywhere. News was personal.
Reality TV is a similar phenomenon. For the full opinion, with links, read here.
Many people love the idea of getting their news from Glenn Reynolds as a filter, with his personal commentary, rather than looking to an institutional filter. We all want celebrities or authorities of one kind or another, and blogs help to fill this demand.