October 20, 2014
I read “HP Shareholder Wants Scrutiny of Wachtell Role in Controversial Settlement.” Quite an interesting write up. The proper nouns alone make the article a stunner. Here’s a sampling:
- Wachtell Lipton Rosen & Katz
- Skadden, Arps, Slate, Meagher & Flom;
- Proskauer Rose, Choate
- Brown Rudnick
- Cotchett Pitre & McCarthy
- Robbins Geller Rudman & Dowd
- Greenfield & Goodman
The proper nouns point not to actual humans in most cases but to law firms.
In addition to the HP management decision to buy Autonomy for billions of dollars, the litigation is acting like a magnet for attorneys eager to help their clients and help blind justice remove the occlusion from her eyes.
Here’s a passage I noted:
“Wachtell inappropriately represented simultaneously both HP and the individual director and officer defendants,” the brief said, “and seemingly succumbed to the pressure to construct a settlement that unjustly benefited the individual defendants and provided, at best, nominal value to the company. Since the interests of the company were wholly incompatible with the goal of the individual defendants to eliminate their liability, Wachtell should not have provided such de facto dual representation.”
Would a law firm behave in this manner? I assume that the resolution of this matter will clarify the situation. I had the same silly notion about the settlement between i2 and Palantir. I am hopeful, however.
Stephen E Arnold, October 20, 2014
October 20, 2014
I read “IBM Paying Globalfoundries $1.5 Billion to Take Unit in Retreat From Chips.” Sounds like a good deal. IBM pays $1.5 billion for a company to take a money losing chip operation.
I thought the idea was to buy low and sell high, not pay and then pay high someone to take a product or business. I know the notion of “freemium” gets some chatter, but I think we need another word for this business maneuver.
The write up said:
“IBM has always taken the long view of its business strategy, continuously reinventing,” Tom Rosamilia, IBM’s senior vice president of the systems and technology group and integrated supply chain, said in a blog post today, calling the deal “one more step in the company’s reinvention.”
I wonder if this is a business recommendation from the almost mystical Watson system or if it was the work of humans. If this was the work of Watson, is it a good example of a solid business answer. If it were humans, well, perhaps we learn more about what happens when a company runs out of management steam?
Either way, a business school has a case to feed to the young sharks hungry for business acumen.
Stephen E Arnold, October 20, 2014
October 18, 2014
Why are they charging for access to ebooks, many of which are already in the public domain and available at archive.org?
I assume the answer is “money.” Harvard’s endowment piggy bank contains about $30 billion, according to US News’s 2013 estimate. Latin and Greek readers are flush with cash. Get with the program. Pony up.
Stephen E Arnold, October 18, 2014
October 17, 2014
I read the dead tree version of “analysts Ask What’s Next for Google.” You can find the write up in the New York Times in section B, page 1 and 2 of the October 17, 2014 edition. You may find the story online at this link but no promises. (As you can see, I am indifferent to Google’s rules for linking. Too bad.)
In the write up, there were two quotes to note. I invite you, gentle reader, to consider each carefully:
- “The thing that worries investors, though, is that the company’s golden goose—its search engine—is showing signs of age.”
- “Google executives grow annoyed with analysts’ fixation on clicks and cost per click.”
The first quote seems to indicate a growing realization that Google’s core technology is more than 15 years young. The innovations are mostly wrapper code and tweaks that generate more money for Google. Keep in mind that the vaunted business model is pretty much what GoTo/Overture/Yahoo had and did not leverage. We have, therefore, a bit of Clever, some voting, and the PageRank method disclosed in a patent held by Stanford University. The innovation engine at Google has been to graft GoTo/Overture/Yahoo with a bit of Oingo (Applied Semantics) and ignite the race to be number one on a page of Google results. Ta da. A business model that works. Keep in mind that Google is, as Steve Ballmer said, before he bought a basketball team, a “one trick pony.” A monoculture of money with an ageing DNA. Eeek.
The second quote shows what happens when a non math club member questions the appropriateness of the math club’s penchant for doing mathy things. In my high school math club, we fooled with machine readable tests, hid books in the library, and dodged confrontations with football players who did not enjoy our sense of humor. Think of it. Google is annoyed with analysts. Don’t those folks have an influence on institutional investors and others with big piles of money to invest? In my math club, we were quite arrogant when the principal attempted to reign in our antics. I can report that the principal put the brakes on our mathy antics. Nevertheless, we were incensed. A mere non math person was poking his nose into our Euler crankcase. Bah.
Google faces several challenges:
First, it has to find a way to generate more money because the company is spending lots and lots of money. Spending is okay as long as there is a payback. Spending to buy balloons, barges, and a solution to death is noteworthy. Pumping bucks into infrastructure is like feeding a youth soccer team at Pizza Hut after a match on a chill autumn day. Fighting legal battles consumes bales of bucks. There are other cost issues, but the GOOG has one source of revenue…after 13 years of trying to generate other revenue streams.
Second, search remains important. Search systems that return results that are not useful face some headwinds. In my view, Google’s precision and recall leave something to be desired. Google forces me to search silos of information within the Google empire to get a reasonable comprehensive view of what Google has indexed. Really useful information like “date indexed” and explicit easy access to book and scholarly content would be a plus. Right now, when I search Google, I see the fruits of much labor in the advertising functions. The relevant results function seems to have been kicked to the side of the information highway.
Third, Google’s enterprise search system has fallen behind the search service available on Amazon Web services. Google tried to disintermediate the information technology professional in an organization. Now, Google has an expensive system that is a lot of work to make useful to the annoyingly youthful users in an organization. In 2002, I figured Google would own enterprise search. Well, that hasn’t worked out. That market should have been a slam dunk for the Google. We do have Google Glass, however.
Google faces some “interesting” challenges. I am confident the math club approach is correct. After all, who cares what an annoying principal or non mathy person thinks?
Stephen E Arnold, October 17, 2014
October 15, 2014
I assume this statement is a surprise to some folks:
Now, disclosure text has become very small, and the shading very subtle, meaning users often don’t realize they are clicking through to ads rather than the most relevant result for their query.
In an increasingly important quest for revenue, these allegedly deceptive ads may be just the beginning of math club maneuvers. Relevance has a new meaning. Perhaps it is a synonym for revenue?
Stephen E Arnold, October 14, 2014
October 13, 2014
According to PacerMonitor, Chiliad, Inc. filed for bankruptcy on August 6, 2014. As you may recall, the company was a Washington, DC area analytics firm founded by Christine Maxwell of McKinley Group and Magellan fame. (Magellan became part of Excite, which also faded away.)
About two years ago, Beyond Search wrote about Chiliad and its big rocks. Also, in 2012, the company named Craig Norris, as chief executive officer. Mr. Norris (an industry leader according to Reuters) had been the CEO of Attensity, sentiment analysis outfit, which has experienced its share of strong headwinds. In the news release about his appointment, he said:
“I am excited to be joining Chiliad at an important stage in its growth. What makes or breaks an analytics company is the quality and usability of its core technology. Chiliad’s offering has proven its ability to extract critical findings from data at massive scale for both Government and Commercial customers. I am eager to see us gain recognition for our technology leadership.”
The news release included assertions by Patrick Gross (Chairman of the Chiliad board of directors) that I have encountered many times in the last five years; to wit:
“Chiliad has already solved two very challenging problems. The first is the ability to rapidly search data collections at greater scale than any other offering in the market. The second is to allow search formulation and analysis in natural language. This means that no longer is an elite class of analysts required in order to generate meaningful results, thus reducing the personnel training and skills shortages that plague alternative solutions and put timely discovery at risk. The explosion of ‘Big Data’ is real and valuable findings are buried in vast collections for both enterprises and governments. Chiliad has the opportunity to integrate its innovative, massively scalable solutions with emerging open source software to build customized solutions for the largest-scale clients.”
Businessweek described the company in this way:
Chiliad, Inc. provides data analysis solutions for various clouds, agencies, departments, and other stovepipes. The company offers Discovery/Alert, a platform that enables investigators, business analysts, and knowledge workers to securely reach, find, analyze, and continuously stay on top of big data—whether structured or unstructured, and classified or unclassified. Its software solutions include Iterative Discovery cycle that allows analysts and researchers to reach various content silos, find what matters, analyze it to find meaning from the information relationships presented and continuously monitor changes; and Architecture, a virtual consolidated data center that enables multidimensional analysis and ranking. It serves government/intelligence, law enforcement, healthcare, pharmaceutical, insurance, and other markets. Chiliad, Inc. was founded in 1998 and is headquartered in Herndon, Virginia.
I have highlighted the buzzwords that were designed to generate sales leads and revenue. I can only assume that the verbiage and the Attensity management touch fell short of the mark. How many of the “analytics” and “business intelligence” companies will follow Chiliad’s path? Good question but I keep asking it.
Stephen E Arnold, October 12, 2014
October 7, 2014
Venerable Hewlett Packard may be a bellwether for other established high technology companies trapped in a time warp. Some hardware and services are enterprise centric. Other hardare and services are consumer centric.. Why not create two companies and double the fun?
The Bloomberg article “HP Split Is Latest Chapter in Whitman’s Change-Filled Career” does a good job of summarizing HP management flip flops. First, it is PCs and enterprise. Then it is to be split up. No, no. HP will not sell its PC and printer business. Oh, oh, wait. Now HP management will create two companies. Wow.
The write up states:
Whitman will lead Hewlett-Packard Enterprise, a business focused on corporate hardware and services, while Dion Weisler, the vice president in charge of Hewlett-Packard’s personal-computer and printer operations, will become CEO of that business. Whitman has been introducing new products and today she expanded a job-cut program to more than 55,000 jobs to trim costs. Hewlett-Packard, based in Palo Alto, California, has fallen behind in mobile computing at a time when consumers have migrated to smartphones and tablets, and last year lost its place as the largest maker of PCs to Lenovo Group Ltd. The split represents a reversal for Whitman, who ruled out a spinoff of the company’s PC division months after replacing Leo Apotheker, who had floated that possibility earlier that year. Whitman has since reiterated Hewlett-Packard’s commitment to the PC business on numerous occasions.
HP seems to be emulating IBM. Another parallel with IBM is HP’s expectations for content processing revenue. IBM has targeted $10 billion as Watson’s goal. HP wants Autonomy to pump billions into the HP coffers. HP and IBM have more confidence in content processing’s ability to generate substantial revenue than I do.
I look forward with interest to the unfolding of the two different B school approaches. I am not sure that Yahoo’s or HP’s will work. For me, the question becomes, “Which iconic high technology company has to flounder for a solution to revenue challenges?”
And, “What is Plan B for these over stressed giants?”
Stephen E Arnold, October 7, 2014
October 6, 2014
I highlighted this remarkable, earth shaking statement from “Google+ Is Hurting the Internet.” Here’s the passage:
…they [users] prefer to get the most relevant results.
The information appears in a Web page presenting “objective study results” conducted for a European group.
The target is poor, old Google. The company has to pump up revenues and margins. Amazon and Facebook are embracing online advertising. The Google X moonshots have not delivered big bucks to the Mountain View redoubt. Mobile search behaves differently from the old fashioned pay to play content inspired by the GoTo, Overture, and Yahoo approach.
What to do?
One answer is or may be Google Plus and user produced content. Another may be to create new user experiences. Some Google users have spotted nesting, a method that creates a Google page with ads within search “experiences.”
Check out the “Hurting” write up. The page links to other content. Is the analysis on point? Well, for the EC crowd, the report just validates what the EC has believed for a few years. For those who root on Google, the report is a misinterpretation of the high value Google delivers for advertisers and the loyal and possible naive users.
Stephen E Arnold, October 6, 2014
October 3, 2014
“Something Will Happen in Google Dominance Probe. Just Don’t Ask Me What—EU Antitrust Chief” may suggest that Google’s woes in the European Community will persist. According to the write up:
[Google] is a company with a huge, huge, huge market share and we have complainants of all sizes.
If the fines are sufficiently large, perhaps the EC’s economic woes can be in part reversed. That just leaves the EC with the challenge of joblessness, immigration, the Ukraine-Russia dust up, and the money demands of Portugal, Ireland, Greece, and Spain.
Perhaps should just raise ad rates for EC customers and share the revenue with Brussels/Strasbourg. Better yet why not route the AdWords’ revenue flow from European advertisers to regulators? Can one interpret AdWords as a form of taxation by the country of Google which should pay for cross border transactions?
Stephen E Arnold, October 3, 2014
October 2, 2014
Navigate to “Google Throws Up a New Hurdle for Retailers.” In order to pump up ad revenues, Google is using a nested query box. When a user plugs in a search, a new page displays with ads related to that query or ads which offer competitors’ products. What’s the trick? Google monitors the vendor whose product elicits the user’s “interest” and then implements the nesting. The payoff for Google is ads and more ads to “assist” the person wanting to buy a branded product.
According to the write up:
A Google search for Revolve Clothing brings up a typical Google search results page, except that just underneath the link to Revolve’s home page and above links to other pages on Revolve’s site, there is a search box that shows within it the text, “Results from revolveclothing.com.” A consumer can then search for anything on the revolveclothing.com domain by typing in that search box. That search produces another Google search results page with results from [a competitor].
We learned about this nesting capability in the research for the Google publications published between 2004 and 2009. There is more functionality to generate more pages on which ads can be displayed back at the Google ranch.
If nesting produces an AdWords’ revenue bump, nesting and its allied functions like generating pages Google constructs will diffuse. If no revenue bump is evident, farewell nesting.
Stephen E Arnold, October 2, 2014