Holiday Rumor: Lexmark and Possible Misprints
December 14, 2015
Holiday festivities in Kentucky feature good cheer and bourbon. The combination yields interesting behavior and rumors. At a hoe down this weekend, one tippler talked about Lexmark, the progeny of IBM in 1991. Lexmark became a publicly traded company in 1995 and became one of Kentucky’s technology poster children. Today Lexmark is more diversified because of a push that began to gain speed in 2010 with its purchase of Perceptive Software. The idea is that Lexmark would become an end to end solutions provider, not a vendor of printers and ink.
The company blipped my radar when it purchased two outfits with search and content processing software. ISYS Search Software had been around since the late 1980s, and Brainware also had some miles on its odometer. Brainware had built a search solution based on its patented n-gram technology. Both brands have mostly disappeared since the Lexmark acquisition.
The company then purchased for $1 billion the one time big dog in document scanning. Between Perceptive and Kofax, Lexmark had a vision of becoming a document processing company. The idea was not a new one in Lexington, which had fostered Exstream Software, purchased by Hewlett Packard in 2008.
I read “Company Shares of Lexmark International, Inc.” and learned:
The Company has disclosed insider buying and selling activities to the Securities Exchange, The officer (Vice President), of Lexmark International Inc /Ky/, Coons Scott T.R. had unloaded 10,000 shares at $38.24 per share in a transaction on July 21, 2015. The total value of transaction was $382,400. The Insider information was revealed by the Securities and Exchange Commission in a Form 4 filing.
The December 10, 2015, Forbes’ article “Weak Demand For Printer Supplies And Hardware Will Continue To Hinder Lexmark’s Printer Business” did little to suggest that the grouser’s comments were wide of the mark.
How has that Lexmark transformation from IBM printer manufacturer to solutions outfit worked out?
If the information shared at the holiday party is accurate, the answer is, “Not so well.” I have no idea if the comments were accurate, muddled by Kentucky’s famous distilled spirits, or the individual’s annoyance that his shares in Lexmark were not putting hay in his horse barn. But the points I noted were:
- The top dog at Lexmark made noises that he wants to leave the company, perhaps as quickly as the new few weeks. The separation terms apparently are rumored to be sufficiently generous to put horses and hay in his stalls.
- The company is for sale and is being shopped in the proper Bluegrass manner. I assume this means with investment bankers who understand the value of digital horse flesh.
- Sales of printers are on hold. The idea is that no one is buying these devices for holiday gifts. The hardware folks at Lexmark are understandably acting like the Grinch stole their Christmas.
- Morale at the company seems to be entering a winter freeze. According to the party talker, grousing is a popular pastime.
The real journalism outfit (Wall Street Journal) reported in October 2015 that Lexmark was “exploring” a sale. So that item in my list of notable party rumors may be accurate. The point about the president, the employee attitude, and the president’s desire to find his future elsewhere may be fluff.
The IBM Lexmark Infoprint EMP156 is perfect for a home office. Don’t forget to order the options: stacker, feeder, and “attention” light.
Lexmark has about $1 billion in debt from its purchase of the document imaging company. The company’s repositioning seems like a good MBA type idea. The problem is that Lexmark has some IBM DNA. The promising Kapow unit is not likely to scale. The enterprise search sector is not likely to scale. The demand for n-gram search is not likely to explode with growth. Here’s the Google finance graph which suggests that revenues and profits are not taking off like SU 35:
My view is that the there will be some disruption for employees (not a good thing in my opinion) and for the city of Lexington (not a good thing for the technology pitch from the Chamber of Commerce).
Worth watching to see if the party chatter is accurate.
Stephen E Arnold, December 14, 2015
Google and Quantum Computing
December 14, 2015
I read “What is the Computational Value of Finite Range Tunneling?” The paper concerns a numerical recipe running on Google spiffy new D-Wave quantum computer. I also read “Google, D-Wave, and the Case of the Factor-10^8 Speedup for WHAT?” This paper points out that Google is making progress with the D-Wave quantum computer. How much progress is a matter for debate among the aficionados of quantum computing. If you are interested in the benchmark, the Google write up and the For What essay are both quite good.
When I worked through these documents, several thoughts crossed my mind, and I jotted down several. Here are two which will not require you, oh, gentle reader, to wade into the murky world of benchmarks and qubits:
1. IBM has a deal, which may be announced by now, to build high performance computer systems for the US government. My hunch is that IBM deserves a pat on its blue suited back for landing a contract to produce something tangible, unlike the Watson marketing hype-o-rama. To my knowledge, Google does not have this sort of deal. Google is writing about another company’s computer, not developing its own super systems. I think this is interesting. In the good old days prior to 2007, the Google was more of a doer. Now Google is a refiner.
2. Googlers have made the D-Wave perform. That’s good. The problem is that like the ORNL wonks using Crays to index health text, the computer is not one available to lots and lots of people. In fact, to verify the Googlers’ achievement, folks with Fancy Dan equipment have to replicate what the Googlers achieved. There will be lots of controversy. The Cray is a user friendly device compared to the D-Wave. Google seems to be working overtime to convince people that it is still a technology leader. I wrote about the gaggle of Googlers talking about Google’s artificial intelligence and machine learning achievements. My question is, “Is the Google feeling the heat from companies doing better in cutting edge technologies?”
Stephen E Arnold, December 14, 2015
Big Data and Math: Puzzlers Abound
December 14, 2015
Interested in math? Navigate to “Big Data’s Mathematical Mysteries: Machine Learning Works Spectacularly Well, but Mathematicians Aren’t Quite Sure Why.” Yep, I know the certainties of high school math are annoyances when dealing with more sophisticated procedures. Dabble in C* algebras, and you will realize why home economics and general business were appealing.
The point of the write up is that numerical recipes can do their thing on existing and incoming data. If the recipes were trained correctly by a human, some of the niftier systems can learn. Now this is not the same as housebreaking your new Great Dane, but the analogy is close enough for would be mathematicians.
If a system does not require humans to supervise it, methods exist to explore hidden structures. Think patterns a human cannot perceive.
Here’s the passage I highlighted:
These methods are already leading to interesting and useful results, but many more techniques will be needed. Applied mathematicians have plenty of work to do. And in the face of such challenges, they trust that many of their “purer” colleagues will keep an open mind, follow what is going on, and help discover connections with other existing mathematical frameworks. Or perhaps even build new ones.
The idea is that good enough mathematicians can use numerical procedures and get pretty useful outputs. There you go. No need to fool around with Hilbert spaces.
Stephen E Arnold, December 11, 2015
Ericsson Reveals the Future: Good News for AI, Bad News for Smartphones
December 14, 2015
The sample was 100,000 people. That’s a lot. I have no clue how these folks were selected or how the data were analyzed. I do know the sponsor, Ericsson. As you may know, has realigned itself and as a result has its shares trading at about $US9.00 as I write this post. Revenues and profits have been flat. I once owned a Sony Ericsson mobile phone. Exciting in a Swedish sort of way.
I read “Smartphones to Die Out ‘within Five Years’, Says New Study.” The main point of the study is to outline the future based on survey results.
The most interesting finding was that smartphones are going to be gone geese in 60 months. I find this an interesting statement. I am not sure how I will make a telephone call when I am in some far flung country to check on my beloved dogs, Max and Tess. According to the write up’s interpretation of the Ericsson survey data, the answer is artificial intelligence. Well, okay.
The write up also presented the 10 trends for 2016. Sigh. It is that time of year when pundits, struggling commercial enterprises, and mid tier consultants display their fortune telling expertise.
Here are the top 10 trends. Be aware that I don’t know what some of these expressions mean, and I am not too motivated to figure out the gobbledygook. You, gentle reader, may have the gumption to tackle the notion of “internables.” I don’t.
The Ericsson predictions are:
- The lifestyle network effect. No clue.
- Streaming natives. Geofeedia will celebrate this I believe.
- AI ends the screen age. Er, how am I going to get information?
- Virtual gets real. No reference to the adult industry which may be the one to watch.
- Sensing homes. Ah, ha. Nest and Watson in the fridge. Well, maybe.
- Smart commuters. Will these folks ride in Uber, autonomous vehicles, or hyperloops? Here in rural Kentucky, mules and automobiles are like to remain popular modes of transportation. Commuters riding mules may want to keep their wits about them when moving down the information superhighway.
- Emergency chat. Yep, 911 is a bit of a mess as a form of emergency chat.
- Internables. No clue.
- Everything gets hacked. “Everything.” Those categorical affirmatives are slippery. One exception and the argument is revealed as specious.
- Netzien journalists. Oh, like this blog?
I have some—well, actually dozens—of observations. Let me highlight a couple.
First, devices are likely to be needed. If my Samsung refrigerator functions as a phone, isn’t the Samsung refrigerator just a larger version of bloated smartphones?
Second, sixty months is not very long. Watson will just be building up steam, and the Alphabet Google thing will be in court. Amazon will be tangled in trucks, drones, and legal hassles. For the unencumbered company like an Ericsson, perhaps these trends will revitalize the firm’s organic growth. Buying stuff from Nortel and Microsoft does not seem to be providing much lift.
Stephen E Arnold, December 14, 2015
Bill Legislation Is More Complicated than Sitting on Capitol Hill
December 14, 2015
When I was in civics class back in the day and learning about how a bill became an official law in the United States, my teacher played Schoolhouse Rock’s famous “I’m Just a Bill” song. While that annoying retro earworm still makes the education rounds, the lyrics need to be updated to record some of the new digital “paperwork” that goes into tracking a bill. Engaging Cities focuses on legislation data in “When Lobbyists Write Legislation, This Data Mining Tool Traces The Paper Trail.”
While the process to make a bill might seem simple according to Schoolhouse Rock, it is actually complicated and is even crazier as technology pushes more bills through the legislation process. In 2014, there were 70,000 state bills introduced across the country and no one has the time to read all of them. Technology can do a much better and faster job.
“ A prototype tool, presented in September at Bloomberg’s Data for Good Exchange 2015 conference, mines the Sunlight Foundation’s database of more than 500,000 bills and 200,000 resolutions for the 50 states from 2007 to 2015. It also compares them to 1,500 pieces of “model legislation” written by a few lobbying groups that made their work available, such as the conservative group ALEC (American Legislative Exchange Council) and the liberal group the State Innovation Exchange(formerly called ALICE).”
A data-mining tool for government legislation would increase government transparency. The software tracks earmarks in the bills to track how the Congressmen are benefiting their states with these projects. The software analyzed earmarks as far back as 1995 and it showed that there are more than anyone knew. The goal of the project is to scour the data that the US government makes available and help people interpret it, while also encouraging them to be active within the laws of the land.
The article uses the metaphor “need in a haystack” to describe all of the government data. Government transparency is good, but when they overload people with information it makes them overwhelmed.
Whitney Grace, December 14, 2015
Sponsored by ArnoldIT.com, publisher of the CyberOSINT monograph
Censys Search Engine Used to Blow the Lid off Security Screw-Ups at Dell, Cisco
December 14, 2015
The article on Technology Review intriguingly titled A Search Engine for the Internet’s Dirty Secrets discusses the search engine Censys, which targets security flaws in devices hooked up to the Internet. The company has already caused some major waves while being used by SEC Consult to uncover lazy device encryption methods among high profile manufacturers such as Cisco and General Electric. The article also provides this revealing anecdote about Censys being used by Duo Security to investigate Dell,
“Dell had to apologize and rush out remediation tools after Duo showed that the company was putting rogue security certificates on its computers that could be used to remotely eavesdrop on a person’s encrypted Web traffic, for example to intercept passwords. Duo used Censys to find that a Kentucky water plant’s control system was affected, and the Department of Homeland Security stepped in.”
Censys uses software called ZMap to harvest data for search, which was developed by Zakir Durumeric, who is also directing the open-source project at the University of Michigan. The article also goes into detail on Censys’s main rival, Shodan. The companies use different software but Shodan is a commercial search engine while Censys is free to use. Additionally, the almighty Google has thrown its weight behind Censys by providing an infrastructure.
Chelsea Kerwin, December 14, 2015
Sponsored by ArnoldIT.com, publisher of the CyberOSINT monograph
More Big Data Analytics Market Size Numbers
December 13, 2015
I read “IBM, SAS, and SAP Do0minatge Big Data Analytics Market, but Challengers Remain.” The write up contained one of those wild and wooly market estimates. I love these confections. Many gobble down the figures because, like cupcakes, the sweet looks so darned tasty.
Here’s the passage I highlighted:
Big Data analytics software revenues will experience strong growth in the coming years, doubling its current global 2015 revenue of $US36.20 billion to $US 73.77 billion by 2021 and reaching $US81 billion by 2022, a compound annual growth rate of 12 per cent in the next seven years.
Here’s another number:
Drilling down into industry specifics, findings also claim that the Big Data analytics healthcare vertical segment will grow from $US7.964 billion in software revenue in 2015 to $US17.031 billion in 2022, a CAGR of 11 percent worldwide.
Seven years. Okay. There is no explanation about the method used to cook up the data. That’s fine. Who reads the label on a box of Cap’n Crunch?
The write up identified some companies posing a challenge to the Big Data analytics leaders IBM, SAS, and SAP. I found this list fascinating:
- Bosch
- Cisco
- Dell
- General Electric
- Intel
- Microsoft
- Oracle.
Life is tidy when the pool of players consists of publicly traded companies. What about the minnows not on the list? Presumably the big folks need not worry about upstarts.
Stephen E Arnold, December 13, 2015
Improving Government Technology: Some Principles
December 13, 2015
Yes, it might be possible. Navigate to “Delivering Results: A Framework for Federal Government Technology Access & Acquisition.” If the link does not resolve, you will have to scout around. No guarantees that this document will remain on a public Web site. The comments apply to almost any government too. I think the write up is focused on the US government, the approach is borderless and a wonderful example of clear thinking about how consultants think about contracting opportunities.
Let me get to the heart of the matter. The way to improve government technology involves the government taking action on several “principles”. Intrigued? Here they are:
- A Common Goal – The Common Good
- Competition and Innovation
- Collaboration
- Contracting Flexibility
- Risks/Rewards
- Workforce
If you have been involved in government work in the US or elsewhere, you may note that the principles omit one of the key drivers: Billing and related matters such as scope change.
There are some other hitches in the git along. Let me highlight one for each of the principles.
1. A common goal is tough to achieve. Government entities want to retain power, headcount, and budgets. The notion of intra and inter agency cooperation or even inter and intra department cooperation is fascinating. The nature of the bureaucratic process is meetings with overt and hidden agendas. The common goal and the common good are easy to describe, just tough to implement.
2. Competition. If you are a vendor in rural Kentucky and you want to bid on a government project, you may have a difficult time achieving your goal. Projects often begin at the appropriate stage, work their way through the consultant driven request for proposal stage, then there is the statement of work stage, and along the way are contracting officers, legal eagles, and assorted procurement professionals. For someone working in Hazard County, the process is definitely expensive, slow, and designed to allow the big dogs to eat the tasty bits. Competition exists but in a meta sort of way.
3. Collaboration. Meetings are collaborative fun fests. The problem is that the objectives of power, headcount, and budget act as fusion power sources among the participants. Talk is the energy of government meetings. Doing results from expanding power, headcount, and budget allocations. Many meetings require a paid consultant or two to provide the catalyst for the talk. The collaboration results in more meetings.
4. Contracting flexibility. Right. There are rules, and if the rules are sidestepped even by some highly placed folks, that wandering off the reservation is rarely a good thing. An outfit called 18f is trying to deliver flexible contracting on a modest scale to some GSA functions. Right. Have you ever heard about 18f? If so, you are one of the lucky few. In the meantime, the established contractors keep doing their thing: Capturing major contracts.
5. Risks / rewards. Risk is not something that is highly desirable either for a government professional or for the people and companies capturing major contracts. Risk can be discussed in a “collaborative” meeting. The systems then continuously operate to reduce risk. Want to have an unknown contractor build your next weapons system? Not going to happen in my lifetime. Want an unknown contractor to code a Web page? Well, sure, just fill out the appropriate forms or figure out what 18f is all about. There is a reason some government contractors are big. These outfits know how to deal with risk, government style.
6. Workforce. The governments with which I have worked struggle with the workforce issue. The idea is to find and hire the best and brightest. How is this working out? Some folks from a successful company flow into the government and then flow out. This is the revolving door for some folks. Folks who stick in government operations, regardless of country, like the working environment, enjoy the processes, and revel in the environment.
The principles are well stated. I am not sure that changing how governments operate is going to make much headway. Think about your last interaction with a government entity. What did that reveal to you?
Stephen E Arnold, December 13, 2015
Palantir: Worth $20 Billion?
December 12, 2015
I read “U.S. Data Company Palantir Raises $679.8 Million.” The key points in the write up from my point of view were that Palantir is valued at $20 billion, which may be a record for a company providing search and content analysis. The other point is that the company has raised more than $670 million. The company keeps a low profile and reminds me of the teenage Autonomy from the early 2000s. Value may become an issue at some point.
Stephen E Arnold, December 12, 2015
Yahoo: The Old Purple Ship Appears to Be Sinking
December 12, 2015
I read “Yahoo Will Spin Off Its Web Business, Including Search and Email.” The write up said:
… company officials said they were exploring a “reverse spin-off” of Yahoo’s substantial Web properties, which include search, email, media and advertising units. By creating a separate company, the value of those businesses would be more apparent to investors — and easier to sell.
Search means traffic. Email means some customers, some of whom pay the Yahooligans. But what is Yahoo search? I have to be forthright. I no longer know.
What’s left? Perhaps Yahoo will become a holding company of questionable acquisitions?
Too bad. I liked the yodel, and I enjoyed the tales of acquisitions gone off the rails. I liked hearing about the warfare among Yahoo silos.
Best of all, I loved the phone call with a New York analyst which asserted that Yahoo had better semantic technology than Google. Guess where that wild and crazy Yahooligan works? If you answered Google, you are correct. Even smart folks with silly notions want to work for a successful company.
Xooglers, by the way, no longer work for the Google. The analysis of Yahoo under the control of Xoogler will make an excellent case study.
Stephen E Arnold, December 11, 2015
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