Telerik is releasing an update to its entire product line this week. As usual, there will be webinars to walk you though all of the cool new stuff. All webinars will be held at 11 AM EST (full time zone conversion) and all will be recorded for Telerik TV on-demand viewing. To join the webinars, register now:

• Tuesday What's New in Q1 2010 Overview + RadControls for ASP.NET AJAX & Extensions for MVC
• Wednesday What's New in RadControls for Silverlight & WPF
• Thursday What's New in RadControls for WinForms & Telerik Reporting
• Friday What's New in OpenAccess ORM & JustCode

If you have been following me on Facebook, you know that last week I traveled to Vancouver, Canada, to watch the Winter Olympics. I love to take photos and videos and of course took a million photos and videos. The problem is that I apparently broke the law well over 100 times while I was up in Canada. These laws and their enforcement need to be updated.

Let’s start with a photo of Scott Stanfield and I being the ugly Americans wearing our Team USA jersey at a hockey game (USA crushed Norway 6-1!).  A friend’s wife took it for us using my personal camera. While I did not ask Scott if I can post it, having known me for 10 years, he knows that if you pose for a photo with me, it will be online-so permission is implied. Nothing wrong with this photo, right?

According to the International Olympic Committee (IOC), this is a borderline case. While it is ok to take the photo of ourselves at the venue, live action is going on in the background. Good news for us is that you can’t see it in the photo. I am safe, the IOC won’t send lawyers to shut this blog down.

Now take a look at this photo:

Similar in nature to the one above of Scott and me, this photo is in the stands of a spectator. Sure this crazy cow-bell ringing Swiss dude did not give me his permission, but that is between him and me, not the IOC. (Trust me, he wants to be photographed!)

I posted this photo on a sports blog along with a small video of the same (to show the world how exciting and crazy Curling, yes curling is, and how rowdy the Swiss fans are with their cow bells!)

Not so fast according to the IOC. They sent me a nasty-gram legalese email and made me pull the photos and video down. You can see the ice in the lower right hand corner as well as the “articles of play” or the stones used by the curlers as well as one of the Olympic judges and logos. I am violating the IOC’s copyright right now, just posting it here again. (And YOU can go to jail just for looking at it!)

WTF?????

The old school copyright laws are out of date. There is a difference between me downloading movies and me taking a photo at a live sporting event. (Or any live event for that matter.) My views on the RIAA and MP3s are well known (they are pure evil), however, let’s take a minute to think about the copyright at the Olympics.

I understand that NBC and other broadcasters paid the IOC a lot of money for the exclusive rights to show the Olympics on TV. I also understand that without that money, the Olympics would be difficult to stage. If I recorded an entire event, or even a very important small part of an event (like the winning shot for the hockey Gold metal), I understand that that takes away from NBC’s exclusive coverage.

That said, that is not what I am doing. I was taking photos and videos of the atmosphere, the venue, the fans and surroundings. While at times I did get some live action in my frame, mostly it was stuff that the TV cameras did not care about. For example, most readers of this blog are technology savvy people who think that curling is a waste of time. I went to Canada believing the same thing. After attending curling, I was in awe of curling and its strategy, skill and the excitement of the plays coming down to the wire. I enjoyed it so much, I went to a second match!

I was also blown away by the crowd. At the US-Swiss men’s game, the Swiss spectators were out of control. (Switzerland had a huge come from behind win on the last extra end shot.) It was like the 7th game of the World Series (or final match at the World Cup for you non-Americans) chanting over and over at the top of their lungs: Go Swiss!  Pounding the floor with their feet over and over. Boom boom boom! And the cow-bells. Oh the cow-bells! Singing the Swiss National Anthem after the match. Totally awesome! I captured the essence of this sheer excitement in the photo above. The IOC wants me to remove it.

Here is an example where a law is meant to protect a party (the IOC) and my violation of that law in actually helping the “protected” party. My photos are free advertising for the IOC. In addition with my enthusiasm, I am helping spread the word about curling, how much fun the Olympics were in person, and bring more attention to the Olympics in general. Someone who was not interested in curling and the Olympics may decide to go to the Olympics in 2012 or watch it on TV because of my blog post and photo. Or someone may google Olympic Curling and be brought to an Olympic site and possibly buy something or watch a video, a video that was sponsored and brought in revenue to the IOC. More to the point, the collection of photos by the thousands of spectators on flickr, Facebook, and blogs, etc, not just mine, will bring in even more to the IOC. The more people the violate the copyright, the more value for the IOC is created.

By violating the law, I am helping the IOC make money. If I follow the law, I am doing economic harm to the IOC in potential lost profits and free advertising. The system is clearly broken. The more photos on flickr, Facebook, and blogs, etc, the better off the IOC is. Copyright laws and their enforcement need to change, catch up with digital media and social networking.

As you all know by now, Google unveiled its latest attempt at social networking this week, called Google Buzz. The first reaction was that it was Twitter meets GMail and some folks joked and called it Glitter. Sure it got 9 million posts in the first two days, however, it is doomed to fail.

Buzz is a response to Twitter and to some degree Facebook. In the past if news happened, you went to Google to see what was up. Nowadays, you go to Twitter first to get the real time news and see what people are saying. You only go to Google for what I call the encyclopedia search, like “who was in that movie?” or “what year was xyz” or “what is the name of that blah blah?” All real time stuff you go to Twitter, like “what is going on at the TED conference this weekend?” As the saying goes, Twitter starts arguments, Google ends them. Twitter and social networking (when you can ask your network a question instead of Googling it) are a threat to Google’s core business model: owning search and the ad revenue around it. Buzz is an attempt to mitigate that by creating the platform for people to go to for real time search and social networking.

The problem with Buzz is that it brings nothing new to the table, except maybe GMail integration, but if you use Facebook you can pretty much replicate that. We already are on Facebook, LinkedIn, and Twitter, so who needs Buzz? Buzz is already too far behind and does not have any break out features, so it is not going anywhere anytime soon. Google is Google and will get some traction just because of its strong brand: just look at the PR around the Nexus One and Android, however, those are great products. Buzz is (at this stage) just a copy cat of what is already out there. I don’t see the platform growing into something better anytime soon either.

At Google, its founders still have a strong say in everything the company does. That is not a problem, look at how successful Google has been; look at Steve Jobs’ hold over Apple and that seems to be working out. But at Google, Larry and Sergey get a lot of things, however they don’t “get” social networking. Google has tried and failed with social networking and community in the past and most visibly ran Orkut into the ground and acquired YouTube since GoogleVideo failed. Google will need to bring in someone big from the social networking community to own Buzz. Since Google has deep pockets, I am sure they can. My advice to Google is to do this pronto and then rethink what Buzz will do.

Google should reposition Buzz to be a master consumer and publisher: the place you go to publish and consume all of your social media content. This way they will get all the eyeballs and then hence, all the ad revenue. What would be great is if Google Buzz talked to all the APIs of all the social networking sites and used OpenID and created one social networking portal for you. You can post your photos, blogs, status updates and consume content from all of your contacts (“friends”) on all the social media sites without having to sign up for them all (or join them all). I constantly get invites to fringe social networking sites from friends overseas and refuse to join some of them, but I am missing out on that content and connecting with those friends. Google Buzz can solve that problem, I can consume that content without joining.

Google will also have to work on a breakout feature to get all the people to visit Buzz, maybe an image search: I can upload my photo and then search across all the social networks for image recognition of myself. Throw on top of this portal some awesome search and categorization and filtering that made GMail so successful and you have a great platform. Then Google Buzz could be the only social networking site you had to visit.  Today I have to check my RSS feeds, Twitter, Facebook, LinkedIn, Flickr, Gmail, and like 10 other sites I am a member of. Sure I have some email integration and RSS readers, but it is not a true one stop shop. Google Buzz can do that. If not, they are doomed to fail.

Fifteen years ago I was a programmer on Wall Street. Times were good, it was the boom economy and Fidelity Investments where I worked was flush with cash as the Dow just hit 4,000 for the first time. (Yes you read that right.) I had a great office in the (now gone), World Trade Center looking at the river and I coded client server applications all day. We were waiting for the conversion from 16 bit to 32 bit with the arrival of Windows 95. Except for arguing with my annoying co-worker Ronald who wanted to write his own grid (I wanted to buy a grid, so it is funny that 15 years later I work at a component company), life was good. I was a good programmer and I use to dream of being CTO of Fidelity Investments one day.

Then one day one of my buddies and I went to an event for IT professionals hosted by Netscape. It was about the Internet, the browser, and this new Java thing. At the session, they threw my entire 3-tier, client-server world upside down. “Dude they are talking about going back to the days of Rumba dumb terminal” my friend said to me. The speaker kept saying that the browser is going to be ubiquitous. (I had to look up ubiquitous when I got home.) A very tall guy from Sun said that “The Network is the Computer.”

I went home that night and canceled my AOL account and joined pipeline.net, an ISP that allowed you to surf the “real” web with Netscape Navigator 1.0 via dialup. Over the next few weeks I took a class on Java and taught myself HTML and put up a web page. (Full disclosure, I abused the <Blink> tag. Sorry, I know some of you now think lesser of me.)  Later that year when Fidelity did not embrace the Internet fast enough for me, I quit and stared my own business to focus on “the internet and databases.”

Somewhere around 1998, the guy from Netscape was right, the browser was ubiquitous. Every Super Bowl ad had a “www'” at the bottom as did every magazine ad. HTML ruled the world. It continues to rule the world to this day. It is hard to believe that HTML is only on version 4.

Then came the iPhone. Web pages on the small screen just don’t work well. Enter the world of applications or apps. So today, instead of web pages, we interact with the sites we like with Apps. Use Facebook on the web? Download the App. Need a currency converter, weather notification, even news and sports scores, there is an app for those as well. No longer do you need to go to a web page, you are using a native application on the device you are using. This will only proliferate with the iPad and rumored Google gPad.

I have never been a believer of 100% “The Network is the Computer” or “back to dumb terminal” browser only computing. Hardware is too fast and too cheap to not take advantage of local graphics APIs, local memory, and even local storage for caching and backup. Why code to the least common dominator? Why should you have “Google docs” just in a browser when you can take advantage of the local device for spell check, rendering, and cache? A hybrid approach is the best bet, with the ultimate storage in the cloud, but the application will store a cached version locally and also have a local App that takes advantage of the local API and rendering engine. This is what all my apps on my Android phone do now, from TripIt to Facebook to a simple currency converter (which I can use offline).

HTML and the web page dominance is now over. A whole generation of users are growing up using devices and interacting with the internet only via Apps. Apps are our future; we are now living in the App Economy, as Business Week puts it.

Apps are the new HTML.

On January 22nd 1984, during the 3rd quarter of the Super Bowl, Apple unveiled the Macintosh personal computer for the first time with a masterful TV commercial directed by Ridley Scott. I was only 12 years old at the time and I still remember it, it was that good. Almost 25 years later I studied it in business school, that is how important to Apple this ad was. The ad was a take on the George Orwell classic novel 1984 and is considered Apple’s defining moment. The ad said that Apple arrived and is now part of the game in a big way.

Since then the Super Bowl has been used to create brand awareness and many other companies have tried to put themselves on the map the way Apple did that January in 1984. A few even succeeded, Monster.com is one that comes to mind. Another, pets.com, created such brand awareness for its corporate mascot, that the mascot lived on, even though pets.com went out of business 9 months after its Super Bowl ad.

Google has never spent any money on traditional advertising. Not a single Google ad has ever appeared on TV and to my knowledge, in print media either. They grew to be a multi-billion dollar company by word of mouth. That is why this morning while watching the Super Bowl (it is morning in China) I almost fell out of my chair when the Google ad played.

The ad was perfect.  It was simple and kept your attention by telling a love story. It focused on the core business of Google: search.

While not a masterpiece like 1984, the ad did the job in a very Google way. Since Google is already “on the map” this ad was a signal to Apple (iPhone) and Microsoft (Bing): Watch out, we’re coming! The ad is a signal of the arrival of Google 2.0. The company that grew up on search that is now making phones, browsers, operating systems, and much more.

Well played Google.

The content middle men (Hollywood studios, record labels, book publishers, etc) are suspicious of digital content. I predicted last month that they will fight back this year against digital distribution, most notably against Netflix and Amazon. Last month Warner Brothers held Netflix hostage and threatened to withhold its content unless Netflix held back new releases for 30 days. Netflix had no choice but to capitulate.

Inspired by their motion picture brothers’ success with Netflix, book publisher Macmillan recently held Amazon hostage. They threatened to withhold their entire collection of books, print and digital, unless Amazon raised their prices for the Kindle. Amazon challenged, but lost and yesterday had to capitulate as well. New books from Macmillan will now cost between $12.99 and $14.99 for the kindle. (FYI, Steve Jobs of Apple said that the iPad’s pricing model will be identical to Amazon as well.) I am now embarrassed that my first book was a Macmillan imprint.

You can’t blame Netflix and Amazon, they had a gun to their head. They are pioneering a new way to legally consume digital content, so we always knew that the middle men would fight back. While the studios hold all the power today, that will not be the case tomorrow.  People who use Netflix never go back to the old model, same with the Kindle. (I say, if it is not on the Kindle, it doesn’t exist.) As Kindles, iPods, iPads, Sony eReaders, etc, all grow in numbers, the studios and publishers will no longer be in a superior position, and the market will remember the barriers they are putting up today. This day is almost here, my 68 year old uncle now streams movies with Netflix.  My parents get the Kindle. My mom has an iPod. An entire generation is now growing up with iTunes and Kindles-my 13 year old niece will not leave the house without her iPod and Kindle.

Today consumers and innovation lost a battle. But the war is far from over.

Apple and Google are the current darlings of Silicon Valley. Anything they do is golden and for the longest time they formed a tag team with Apple building great consumer electronics and Google leading in search and other search related applications like Maps and GMail. Google Search, Google Maps, and GMail power the iPhone and helped it be such the huge success it was. The sweet relationship between the two tech giants was only growing.

Now it is war.

First Google made Android. That pissed off Apple somewhat, even causing the Google CEO to quit Apple’s board. Google use to get the location data from each search on the iPhone and Apple started to withhold it last year. Apple feared that Google would use this valuable data to do market research and to build behavior metrics into the Android. If Google knew every search performed on an iPhone and the location where the user was standing when making that search, that is very valuable market research information if you are thinking of entering the mobile market.

Then last summer Google Voice was rejected by the Apple App Store. As I wrote on this blog several times about Google Voice, it is disruptive technology that AT&T is threatened by, so Apple rejected it, showing us once again that Steve Jobs controls the iPhone very tightly. While this spat was ugly, it was just a lovers quarrel. The FCC got involved and some high profile tech luminaries ditched their iPhones over this, but it was a not a declaration of war.

Then came the Nexus One. Pearl Harbor. Now Google is right on Apple’s turf. Apple decided to buy a mobile advertising company to retaliate. The war is on.

Even the iPad is a front in this war. ChromeOS started to ruffle Apple’s feathers. While ChromeOS is a threat to Microsoft in the NetBook space (but Windows 7 for Netbooks is something like $7), ChromeOS is on a collision course with the iPad. In the battle for lower end light weight web device laptop/netbook/slate market, it will be ChromeOS vs the iPad.

Steve Jobs decided to get into the rally the troops mode now that war is on. As reported by Wired, Jobs went ballistic at an Apple company town hall meeting when the topic of Google was brought up.  He claimed that Google wants to kill the iPhone, but “we won’t let them!” He said that Google’s mantra of “don’t be evil” is “bullshit.”

Wow, this venom is usually reserved for Microsoft. Speaking of which, Apple is rumored to replace Google as the default search application on the iPhone with Microsoft's Bing. Warfare makes strange allies.

After you read Gizmodo or Tech Crunch, read this blog next.

With more hype and fanfare than the President’s State of the Union Address, Apple launched the much anticipated iPad today. Despite the surprisingly many show stopper (for me at least) complaints like: no camera for web calls, no USB ports, no widescreen form factor, AT&T 3G, no HDMI output, and no Flash and Silverlight support, the iPad will probably sell well at first. Then sales will drop off. Even though version 2.0 will have a USB port and an HDMI output, I don’t see the iPad being a massive break out hit like the iMac, iPod, and iPhones before it.

The reason why is because we just don’t want a tablet. The industry has been trying for years. Apple tried as far back as 1983 and failed. Microsoft has been trying for almost a decade and failed (Tablet PCs are only 2% of PC sales.) If you have a smart phone and a laptop, where does the slate/tablet fit in? Apple says you will use the iPad to surf the web, however, the web will be pretty crippled without any Flash or Silverlight support. Nor can you make video Skype calls. Apple says you will read books, but the battery life and eye strain will drive the eReader crowd back to the Kindle. Apple says you will watch TV and movies, however, with a 4:3 (non widescreen) form factor and without HDMI output you will watch less and less media.

Since I am not going to ditch my smartphone and I am not going to ditch my laptop, I don’t need another device to carry around. The iPad can’t replace a laptop without multitasking. It is too big to replace my phone. Apple was figuring that maybe it would replace my Kindle, however, the Kindle’s power is that it does just one thing and one thing great: it is an awesome platform to read books without any eyestrain. Nothing else.

The iPad is not a category killer. I guess Steve Jobs is human after all.

When Windows Mobile 6.0 shipped, Apple’s iPhone was just a rumor and Android was nowhere in sight. How times have changed, now Microsoft has been left for dead in the smartphone/mobile space.

We have been waiting, and waiting, for any news on Windows Mobile 7 from Microsoft. Two rumors leaked this week that lead us to believe that the long, long wait will be over soon.

The first, reported by WMExperts, claims that there will be news on WinMo 7 in the next two months, possibly at Mobile World Congress in Barcelona in mid Feb or CTIA in Las Vegas in late March. WMExperts also say that there will be two versions of Windows Mobile 7:

• Windows Phone 7 Business Edition
• Windows Phone 7 Media Edition

Also on naming, WMExperts says:

First, it's not Windows Mobile 7 but just "Seven," so that's how we're going to refer to the OS from now on. Also the phrase "Microsoft Zune Phone Experience" may be tossed around.

There is a lot of information out on the site including HD, live TV, XBox integration, Exchange integration, Silverlight, etc. Sync abilities are to multiple devices, the cloud (Live Mesh?) and PCs. I am starting to believe this web site, this all sounds like Microsoft: confused launch, multiple SKUs, names, and bad marketing.

The WSJ’s “All Thins Digital” site has rumor #2: Microsoft is making their own phone. Microsoft, in conjunction with HTC (the maker of the Nexus One, can you spell conflict of interest over in Taiwan?), will release the Microsoft branded “Zune Phone”. Details are sketchy, but the Zune Phone will have HD video and music subscriptions, so it is obviously targeted at the consumer space.

I predict that Microsoft will announce Win Mobile 7 at the Mobile World Congress in Barcelona in mid-Feb. The MVP summit is the same week in Redmond, so they can also inform the MVPs at the same time. (Steve Ballmer promised us last year we would be one of the “first to know”.) I am also going to speculate that the big developer announcements (Silverlight, etc) and the “Zune Phone” will be at Mix in Las Vegas in March. (Since I will not be at Mix, I suspect that they will give one away to each person attending, just like the PDC Tablet.) They can follow up with more details at CTIA the next week. (Also this is possibly why they moved the Visual Studio Launch to April, not to conflict with CTIA.)

Since Microsoft has waited for so long to release WinMo 7 and has done it with the Apple like secrecy, they have raised the stakes. With the hype around Android and Nexus One, and the sex-appeal of Apple, in order for Microsoft to stay in the game they have to really launch something special.

Indications are that WinMo 7 will build on top of everything Microsoft has done well in the consumer space: XBox and ZuneHD. The ZuneHD platform has gotten rave reviews, so building a phone on top of it makes sense. It would also explain why Microsoft was silent for so long on the phone, they had to first build the ZuneHD. Apparently there is good Twitter and Facebook support and via Live Mesh, you can edit documents on your PC remotely and sync them up. With awesome Office and Exchange support, that is huge for business users.

That all said, is this enough to stay relevant?

I think that Microsoft suffers from the fact that they are not named Apple or Google. Unfair, yes, but that is the game they are in. Media will immediately cover the blogs of the Apple or Google faithful and take away from any PR splash. Also since someone as lowly as I can figure out what is coming and when from Microsoft, expect Google and Apple to trump the day before the announcement. (Apple releases iPhone with SD card will dominate the news!!!)

In order to really shake things up, Microsoft has to take a gamble. They need to complete the revolution that Apple started and Google took to the next level.

As I have said before, the way Americans (and Canadians) buy mobile phones is broken. We buy crippled, subsidized  phones from carriers that lock us into an expensive contract. Apple changed that by making a phone that the carriers had no control over for the first time, however, they still got us locked into one carrier. Google changed the game by giving us an unlocked phone, but in reality you still have to deal with TMobile since the AT&T support is lacking and there is no CDMA version for Verizon yet.

In order for the Zune Phone to be disruptive, it has to be offered as both GSM and CDMA, unlocked, cost $150 (subsidized by Microsoft with Bing ads), and available at Wal Mart and Best Buy. If the phone is sexy enough where tons of people want it, they will go buy it at the local electronics store. Apple and Google will soon follow suit and we will be released from the tyranny of the carriers.

We’ll see what happens…

Have a startup? Want free software? The Microsoft BizSpark Camp is for you. You have to sign up by Monday. See below for more details.

Via Sanjay Jain…

With several successful Microsoft BizSpark Incubation Weeks (Azure Atlanta, Win7 Boston, Win7 Reston, CRM Reston, CRM Boston, Win 7 Irvine, Mobility Mountain View,), we are pleased to announce Microsoft BizSpark Camp for Windows Azure in New York, NY during 28–29 January 2010. Based upon your feedback we have made several changes including offering cash prize, compressed time commitment, and much more. We hope you're tapping into the growing BizSpark community.

The current economic downturn is putting many entrepreneurs under increasing pressure, making it critical to find new resources and ways to reduce costs and inefficiencies. Microsoft BizSparkCamp for Windows Azure is designed to offer following assistance to entrepreneurs.

· Chance to win cash prize of $5000

· Nomination for BizSpark One (an invitation only program) for high potential startups

· Learn and build new applications in the cloud or use interoperable services that run on Microsoft infrastructure to extend and enhance your existing applications with help of on-site advisors

· Get entrepreneurs coaching from a panel of industry experts

· Generate marketing buzz for your brand

· Create opportunity to be highlighted at upcoming launch

We are inviting nominations from BizSpark Startups interested in Windows Azure Platform that target one or more of the following:

• Windows Azure
• Microsoft .Net Services
• Microsoft SQL Azure
• Live Services
• Microsoft SharePoint Services
• Microsoft Dynamics CRM Services

The Microsoft BizSparkCamp for Windows Azure will be held at Microsoft Technology Center, New York, NY from Thu 1/28/2010 to Fri 1/29/2010. This event consists of ½ day of training, 1 day of active prototype/development time, and ½ day for packaging/finishing and reporting out to a panel of judges for various prizes.

This event is a no-fee event (plan your own travel expenses) and each team can bring 3 participants (1 business and 1 – 2 developer). It is required to have at least 1 developer as part of your team.

To participate in the BizSpark camp, you must submit your team for nomination to Sanjay or your BizSpark Sponsor. Visit Sanjay’s blog for details on how to submit your nomination by Monday, January 18th, 2010. Nominations will be judged according to the strength of the founding team, originality and creativity of the idea, and ability to leverage Windows Azure Scenarios.

You may want to enroll into Microsoft BizSpark, an exciting new offering that enables software startups to leverage Microsoft development and platform technologies to deliver next generation web and Software + Services applications. For details see here.

After a round of hacking attempts that apparently were supported by the Chinese government, Google announced on Tuesday that they are removing the censored results displayed for a google.cn search in China. If you take a look now, you can see photos of the tanks in Tiananmen Square during the massacre 21 years ago. This violates the laws of China and Google will most likely be shut down by the Chinese government and exit the Chinese market.

Here in Hong Kong the local media is going crazy. Hong Kong, while part of China, is autonomous and has a free press. Bloggers, twitter, and some media outlets are applauding Google for “standing up to censorship.” (Google’s decision on Tuesday does not effect Hong Kong.)

This was a nice play by Google. They are removing the censorship and forcing the Chinese government to shut them down, which they may well do soon. It is a move that gets a lot of blog love. Former Microsoftie Robert Scoble said that China is so important economically and: “That’s why this move today impressed me so much.”

If Google has such problems  with censorship and a corporate mission to and “don’t be evil” why did they agree to censorship in the first place when they entered China in 2006? Why would Google operate in China for four years while censoring their search results?

If Google was #1 in search in China and making boat loads of money, would they just pack up and leave? They are a business at the end of the day, so my bet is no. Google has not been making money in China and its revenues in China are “truly immaterial” according to Google. According to the Economist, Google has high expenses in China, including 700 people in the Google China office. Google is way behind Baidu in China, which has well over 300 million users (that is more than the entire population of the United States, the world’s third largest country by population…)

While I applaud Google for standing up to censorship, I feel that Google is exiting China due to business reasons and picked a fight with the Chinese government to get the automatic love of technology luminaries (who love Google anyway) and political rights activists who need a big powerful poster boy. If you think about it, it is a brilliant move, you hide the fact that you failed in a market and get tons of good press for poor business performance. Compare these headlines:

“Google exists China after years of poor performance. Fires 700 employees.”

or:

“Google stands up to censorship! Google on the side of freedom and democracy. Love live Google!”

Maybe I am wrong and if I am, I apologize in advance.

Last week I made some technology predictions in the Microsoft space. Yesterday I spoke about the mobile space as a whole. Today I will conclude my 2010 predictions with a look into digital content.

2010: Digital Content-The Empire Strikes Back

Already more music is sold online via iTunes then on physical CDs. Add in piracy and there is even more music in digital format. 2010 will be the year where we start to see movies and books move digital. Not much of a prediction. My predictions is that the movie and publishing industry will spend most of 2010 fighting back and in denial much like the music industry and the RIAA did 5+ years ago.

Today Netflix will sell you a device that will stream movies down to your HD TV without a computer involved. You can get unlimited movies for about $9 a month. The problem is that there are only 18,000 movies available and most of those movies are older. That is because Hollywood is stonewalling Netflix and not selling them a license to stream. Actually it is much worse than that. Hollywood is also holding Netflix hostage for new release DVDs. The studios are now planning to withhold new release DVDs for 28 days before they sell them to Netflix. Warner Brothers just inked a deal with Netflix that did just that. Now all new Warner Brothers movies released on DVD will be available for you to buy or rent at your local video store, but not available at Netflix for a month.

This is exactly the type of behavior that the RIAA and music industry would be proud of. Warner Brothers is now actively encouraging its customers to pirate the new release movie instead of getting it legally from Netflix.

Hollywood 1-Netflix 0.

But this is just the beginning.

Seeing what iTunes did to the recording industry, the technology phobic world of publishing may soon follow suit. Amazon is getting some pushback from publishers over pricing of titles for the Kindle. It is only a matter of time before the publishers “Netflix” Amazon. I suspect you will see something along those lines before the end of the year, especially that for the first time more Kindle books were sold on Dec 24th and 25th than “real” books.

Just like Darth Vader in the Empire Strikes back, the movie studios and publishers may win the battle in 2010, but they will lose the larger war. (Yes I am saying that Netflix and Amazon.com are Luke Skywalker and Han Solo.)

Last week I made some technology predictions in the Microsoft space. This week I will venture outside and look at the mobile space. 2010 will be remembered as the year where the mobile device hits critical mass, where we rely more on the smart device for Facebook, Twitter, email, TripIt, YouTube, etc, than an actual computer. With the device so important lets take a look at some mobile predictions.

2010: Google v Apple

With the introduction of the Nexus One phone from Google last week, Google just stepped on Apple’s toes. While Google is pushing its Android Mobile operating system to hardware manufactures, Google teamed up with HTC and built the Nexus One to sell as an unlocked GMS phone (and a TDMA version on the way for Verizon users.)

This represents a two pronged attack by Google. First Android is now considered an alternative to the iPhone by manufactures watching their market share disappear to the iPhone, just look at the Droid by Motorola. Second, by offering an unlocked phone directly from Google, while a risky move since they don’t want to annoy Android adopters like Motorola, Google is taking a page out of the Apple playbook-control the entire experience: software and hardware.

Apple will be concerned since it relies on apps by Google on the iPhone such as Gmail and YouTube. Concerned, but Apple is apparently not intimidated. On the same day as the Nexus One announcement, Apple announced that they would acquire Quattro Wireless for $275 Million. Quattro is an ad company, so Apple is basically saying that if Google is going to play in the iPhone world, Apple is going to play in the advertising world-Google’s largest source of revenue (say 90%) .

I won’t predict how this will end, however, I will predict that 2010 will have a lot more “Google v Apple” headlines as new devices and services are announced.

2010: Carriers lose control

One thing to think about is that while the Google v Apple battle is fun to talk about, let’s not forget about the carriers. 2010 will be remembered as the year the US Mobile industry changed. Before the iPhone, the carriers had full control. We bought a phone and service from them. They sold us crappy locked phones. You could not buy a different phone unless you traveled abroad and saw one and had a GSM carrier at home. If you did not travel and saw a cool phone and were lucky enough to have your carrier offer that phone, you could buy it from them and the carrier would brand the phone and remove several features. This was so common that many people did not even realize it was happening.

Apple made a device that everyone wanted. AT&T wanted it so bad that they let Apple do just about anything they wanted to. So while you still buy your locked iPhone from AT&T, it is the exact phone Apple designed, not the carrier. Sure AT&T had some influence over what was in the AppStore and that caused some problems last summer, but the iPhone was the first shot in the revolution.

This year represents the next step in the battle: removing control of the handset from the carrier completely. While the iPhone was a step in the right direction, if you wanted one you still had to deal with AT&T and it was basically impossible to get the iPhone anywhere else other than AT&T.

The Nexus One is the first “must have” phone that is not tied to a carrier. You buy your phone first at Google.com and then take your chip and put it into your phone and it works. While there are exceptions to this (AT&T 3G frequencies are currently not supported, defaulting you to EDGE, etc) it is the first step of removing the control the carriers have. Other vendors will follow suit. Fast forward a few years and Americans will do what people do in most countries, buy the phone first and then buy the service. This will lead to bigger and better innovation in devices.

2010: The year Microsoft comes back from the dead

Let’s face it, Windows Mobile has been left for dead behind the iPhone, Android, and Blackberry. A lot of people are counting Microsoft out. While it is late in the game for Microsoft, the iPhone showed that you can build an awesome device and grab huge market share in just 2.5 years. Microsoft has been working on Windows Phone 7.0 for well over a year, if not much longer. They have not given us “insiders” any info (very Apple of them.) That allows me to speculate wildly and make the prediction that Microsoft will do something bold in the mobile space in 2010.

Microsoft will do two things in 2010. First they will release the long awaited Windows Phone 7.0. We may see an announcement as early as next month at the Mobile World Congress in Barcelona. This would work well since the MVP summit is the same week in Redmond, so they can make the announcement in Barcelona and then offer MVPs more technical details. We should see Windows Phone 7 ship in 2010 and it will most likely be based on the Zune HD with a healthy dosage of Silverlight on top for application development. Will it succeed, that I can’t predict, but I will predict it will be good enough to keep Microsoft relevant.

Speaking of Silverlight, that is going to be Microsoft’s next big mobile move: position Silverlight as a cross platform mobile application framework. While Adobe and Apple don’t get along, Microsoft will start to position its Silverlight platform to work with Android and the iPhone. It will be a way to get the Microsoft footprint onto those devices.

Will my predictions be right? I hope so. But if not, it sure will be an exciting year in the mobile space!

As I sit in my hotel room recovering from my PDC Hangover and reflecting on the past week, the Day 2 keynote by Steven Sinofsky was the highlight for me.

You may be thinking, yea yea, lucky bastard, you got a free laptop. Sure that was awesome, but that is not what stuck out most in my head. The most important thing that Sinofsky did was to be brutally honest with the audience. This represents a new attitude from Microsoft.

Sinofsky admitted Vista’s flaws. To prove that he got it, he even showed some of the annoying dialogs and videos of customers doing useability testing with those annoying dialogs. (He did follow up with some of the changes Windows 7 made and some of customer useability tests.)

Then he moved to IE 9 development. I remember the Microsoft of the browser wars era. The one where Bill Gates would get on stage in front of 20,000 people at COMDEX and never say the words “Netscape” but rather “down level browser.” At the PDC keynote, Sinofsky  said the words “Firefox” and “Google Chrome”. Not only did he say those words, he showed charts at how slow IE 8 is compared to Chrome, Safari, and Firefox. Of course he was also showing how IE9 will be just as fast, but he is openly admitting in front of 5,000 people and live on streaming video that IE 8 sucks.

He also talked about how IE 8 fails the ACID 3 Standards Test. I ran it here and IE 8 gets a pathetic 20 out of 100:

Then Sinofsky talked about IE9 and the Acid 3 test. IE 9 gets a pretty sad 32, but he showed it anyway and promised to get better.

I also like Sinofsky because he is accessible. When Win7 went RTM to MSDN last summer, I sent a message complaining about what I thought was a bug to an internal Microsoft email alias. Sinofsky replied to me personally with a solution (on a weekend), and it was soon clear to me that the problem was caused by something that I did, not Win 7. I followed up with some thanks for the solution and told him that the real problem was somewhere “between the chair and the keyboard.” He even replied back again saying no problem and we had a few more mails in the thread and a good laugh. This is a very busy VP in charge of one of the most widely used products in the world taking time out to talk and troubleshoot with a customer.

You may be thinking, sure Steve but you are an MVP and RD. Well at the PDC in the afternoon after they gave us the laptops, Sinofsky spend about an hour or two walking around looking for people in the cafe playing with their new laptops. He stopped and chatted with each person asking how they liked it, did the touch live up to their expectations, etc. Then he went to the expo hall and did a book signing (with free copies of his book) and even posed for photos with anyone who wanted as he signed the book.

This level of accessible and honesty is simply amazing. Keep it up Microsoft.

Following the lead of the Department of Justice (DOJ) in Washington, DC, the Attorney General of the State of New York, Andrew Cuomo, has brought a lawsuit against Intel, calling them a monopolist. While Intel has recently settled legal claims with rival AMD (mostly due to patent disputes as well as some anti-competition charges), Cuomo is suing Intel on the grounds that they are a monopoly and have stifled competition.

While Intel’s market share is huge, over 80% of chips sold are “Intel Inside”, the free market has regulated the industry very nicely and lead to innovation. Intel and its cheap and low powered Atom processor started the netbook revolution (I now see as many netbooks as Macs in Starbucks). Look at the progress with multi-core and x64 architecture. (Actually three years ago I thought AMD’s x64 chips were better since their high end chips had more cores at the time. I remember buying an AMD based 2xquad core x64 SQL Server machine in that time frame and was impressed that AMD’s multicore server chips were so much better.)

Over ten years ago, I lobbied the US Congress against the DOJ’s case against Microsoft on similar grounds. At the time did Microsoft do some bad “evil empire” things that they were able to do since they were so big? Yes. Enough to warrant an anti-trust legal battle? No. The free market was able to sort it out on its own, far better than the legal remedies brought by the DOJ. When Microsoft got all big and lazy with dominate Internet Explorer market share, boom, Firefox came out of nowhere and handed Microsoft its lunch. Now Microsoft is starting to invest and innovate in the browser space, but now has to deal with not only Firefox, but Chrome and Safari. The free market did loads more to spur innovation and regulate Microsoft than the anti-trust trial even dreamed of doing! Same with Intel, allow the free market to decide, not lawyers.

Fellow New Yorker and good friend Andrew Bust wrote an opinion here. Andrew is a registered Democrat and I am a registered Republican. We both agree on this issue. The last time we agreed on a political issue was when DOS was the primary operating system used.

Let the free market regulate the industry and don’t let the government stifle innovation. Sign a petition here.

I am in Hong Kong speaking at the Hong Kong International Computer Conference. It is a great conference, it focuses on IT as a driver for innovation and economic transformation. I was lucky enough to be doing one of the keynote presentations on how technology is so disruptive and how cloud computing changes entrepreneurship. In my talk I mention Ray Kurzweil’s Abstraction of Moore's Law, which can be summarized as saying that the next 20 years will see as much technological innovation as the past 100.

I represented Microsoft Hong Kong in this talk, and after the speech lots of people came up to me to chat. I got to talk to tons of folks at the conference: I got to talk to students and professors at Hong Kong University, the folks from One Laptop per Child, entrepreneurs (including a dude building some amazing robotics), people form NGOs, and local software developers. We got to talking about how the new technology reality has drastically changed business models. Think about digital media, the music industry has changed forever, old business models just don’t work anymore.

This got me thinking. Microsoft recently announced a great offer for Visual Studio Ultimate (yet another SKU). But the world has changed. Web 2.0 is here! So I say: All SKUs of Visual Studio should be free.The goal should be to get Visual Studio out to everyone, for free. I know that we have Express versions of these products, and for the most part, they are very capable, but I mean the real deal, Visual Studio Ultimate.

Now I know what you are thinking: Steve, have you gone soft on me?

Of course not.  I am still a disciple of Milton Friedman and a firm believer of free markets and economic incentives. But that does not mean you have to actually sell something to make money on it. I am thinking of Visual Studio 2.0.

For example, there are four versions of Visual Studio as far as I can tell. (And the fact that I have no idea is a problem.) There are the free express versions, Professional, Premium, and (the new SKU) Ultimate.

Microsoft should do away with all versions and give away Ultimate (without MSDN) to anyone who wants it. My mom could go and download it if she wanted to. Just have to provide some demographic information and have a Live ID.

The startup page in Visual Studio would be ad supported (and you can’t make it go away, so you will see it each time you load Visual Studio.)  I could see Telerik or our competitors wanting to sponsor that page-but not in a “pay us a million dollars model”, rather as a pay per conversion model. Basically Telerik and our competitors would pay a small fee to be on the startup page and be able to stream ads to the developers and each Telerik license sold, Microsoft takes a cut.  Note to Microsoft, since this was my idea, can Telerik have an exclusive on that page? :)

In addition, in exchange for the free Visual Studio, Microsoft will get anonymous data from the developers. What country you are in, the specs of the developer machine, installation experience, etc. Also how many projects were started in C# v VB v F#, etc. Silverlight v Web, etc. Imagine if Microsoft knew all of this data!! I want to know how many lines of C# code in Brazil were written for Windows Forms last week.

Microsoft can then sell ad space based on your environment. Think about a C# developer in Poland working mostly on Silverlight. On the startup page next time there are offers (in Polish) for Silverlight tools, conferences, books, or even job offers. How much would Dell pay to market to every developer in Australia with Visual Studio installed on an “underpowered” machine? The vendor would only know who you are if you actually clicked on the offer.

Microsoft can also make money by using Visual Studio as a sales engine for MSDN. MSDN does not really have a “sales force” and Visual Studio can be a “loss leader” for MSDN.

But MSDN’s business model would have to change as well. Why not have MSDN (not the software part) evolve into a Visual Studio based Facebook/Linkedin social network for developers. You can only get into your “MSDNFacebook” via Visual Studio. When you are coding, Visual Studio can automatically update your status (Stephen Forte is currently breaking the build….) Imagine hitting F1 and be brought to a MSDN forum search on that line of code as one option. Every .NET developer in the world would be a member of this social network! Want to find a user group? No problem! Imagine the collaboration opportunities. A whole new world of revenue opportunities would open up to Microsoft, including an IPO of MSDNFacebook! :)

In addition, the MSDN software pricing model would change. Microsoft can sell fractional MSDN licenses and specialize MSDN for local markets and different developer types. Maybe you only want MSDN for Web Development. MSDN is expensive since it includes big things like Windows Server and Exchange, etc. (I have never installed Exchange, nor will I ever do so.)  Maybe you can have MSDN options where that is excluded. Kind of like a menu where you customize just want you want and pay only for what you use. Sell more with less. (Sound familiar?)

Of course if you want the ads and the anonymous data collection turned off, you can pay an annual fee. If your employer is paying that annual fee, they can opt out of certain content, such as a job offer coming your way, etc.

Visual Studio 2.0 would be awesome. Developers get free software and more collaboration, vendors get to tap into the entire ecosystem, and Microsoft makes more money while collecting a tremendous amount of metrics, metrics that will drive new features, service packs, etc.

Maybe this will be one of the great announcements next week at the PDC……..

Tomorrow I will be speaking at the 2009 edition of the Hong Kong International Computer Conference. This year’s theme is on Value Creation and Economic Transformation via IT. When they asked me to put together a session, I jumped on the idea of how Cloud Computing has changed the economics of start-ups and entrepreneurship. 

I started Corzen, my last company, in 2002. We got started for around $250,000. About $75,000 of that was on building out a data center. I am a software guy, so this also took a lot of my time. In 2010, I can have more processing power, more storage, and more free time for around $99 a month from Windows Azure or Amazon EC2. Think about what this will mean, it will be much easier to start a new business in the future.

The implications of this are staggering. The late 90s was always considered the golden age of start-ups since funding was so “easy” in the .com boom. Now you can start your own business for less than $20,000! We’ll see a ton of new businesses pop up in all industries. Since you won’t need investment to get started and most entrepreneurs will use their own money, the start-ups will have tons of passion.

Innovation will take a great leap forward in the next decade. Cloud Computing will lead the way.

The reason why Apple products are so slick and cool is two fold, the first is that they are a great consumer product/design company hands down. But the second is an equally important reason, a reason that will potentially prevent them from massive long term market share (like Windows, Oracle, etc.) The second reason why Apple products look and work so nicely is that they have a tight control over the software installed on their devices. For example if you are a software developer and want to build an application for the iPhone or the Mac, you need to follow the strict Apple design guidelines and then get approval from Apple before you can sell (or give away) your software.

This is great, it gives the vendor (Apple) near complete control over what gets installed by the user base and the vendor (Apple) can control the user experience. This of course has some great benefits: less virus attacks, less crashes (windows is usually unstable due to people like me: software developers) and less hacks. You can also guarantee that there is no porn or politically sensitive content on your device.

This also has a negative side effect. Pissed off developers. Tech blog TechCrunch reports that many software developers are getting angry with Apple due to the rejection of their apps, random removal of their apps, or rejection of an upgrade of their original app from the Apple AppStore. This will only anger more and more devs and over time, will limit the developer community on that platform. As we all know, with the apps, there will be no platform.

I am not saying that this is happening (developers leaving in droves) now, but it can happen. A recent decision to pull an app may have started the revolution. Apple last week pulled the Google Voice application from its AppStoe. Google Voice is pretty cool and allows you to use VOIP to make and receive calls (among over cool stuff.) So free phone calls means less minutes AT&T (and other international carriers) can sell.

This caused a bit of an uproar in the tech world. Some major influencers including prominent Apple supporters decided to quit using the iPhone over the decision to remove Google Voice. Google’s CEO Eric Schmidt has decided to step down from Apple’s board due to the conflict of interest. Lastly, the US government has gotten interested, last week, the FCC launched an investigation about the removal of Google Voice.

Apple (and AT&T) should allow any application to be installed on the iPhone as well as any other phone for that matter. On the regular wired internet, I can buy a PC and then download and install anything I want, my ISP does not control what computer I can buy and what I can see and what I can’t see. Why is it different for phones? I can’t install everything I want, nor can I even buy whatever phone that I want, I have to buy the phone from the carrier in a “locked” mode.

There is a reason: the United States is large country by land mass. The government has let the carriers have some control due to them promising to wire the whole country-this is why you can get signal in remote places where there is not a lot of demand. But now years later we are paying the price. It is time to open up the airwaves and allow us to buy any phone and install any application. The Apple AppStore is a walled garden that eventually will fail. While Apple risks losing a few design points and some system crashes and AT&T will lose some revenue, over the long run, if they allow anyone to develop software and anyone to install it, we all will be better off.

Looking over the PDC content for this fall you can definitely see a trend: Cloud Services. This is to counter Amazon's S3 offering.

First let's define what Cloud Computing is and what it means. Cloud computing is not Gmail, Hotmail, or even Google Documents. (This is why you won't see Microsoft Office moved to the Cloud in a very robust way, that is just web access for popular productivity software.) Cloud Computing is replacing an application's hardware and plumbing infrastructure with a service hosted by someone else. For example let's look a typical corporate system:

• Back-end data storage (SQL Server, Oracle)
• Back-end application server (IIS + .NET, COM+/ES, Tuxedo, even CICS (that dates me))
• Front end machine to access the application (Either a workstation via a browser or windows app, or mobile device)

It gets expensive for small and even large firms to build the network, firewalls, domain services, user accounts and of course the hardware (with its underlying RAID arrays, UPSes, racks, power, etc.) Sometimes this is a barrier to growth (or even entry) for small to medium organizations. Not only do you have to learn all about subnets and RAID arrays, you also have to learn about UPS and power strategy, and manage a development project. (Man, I just want to write some stored procedures, who cares about an UPS and RAID array!)

This is a problem, epically for start-ups. You have to build a rack before you even build a company and product. That is expensive and an up-front fixed cost. More than likely you will build a rack that at overcapacity so you can grow, since it is time consuming to add more capacity later on. Also, you usually have to hire people to help you figure this out. Building a rack is expensive and also expensive to maintain.

Cloud computing is providing the back end infrastructure, the first two bullets, to firms as a service. The beauty of this model is you pay for what you are using, bandwidth, storage, and clock cycles. So a startup does not have to spend $20,000 on a new rack, they can pay a monthly cost to host their application in the "cloud" and only pay for what they need. In the beginning this will be a small fee since a startup has no customers and then the fee will grow (as revenue grows hopefully!) Amazon S3 is attracting many startups and is changing the dynamics of funding a startup since they don't need as much expensive hardware and IT expertise.

So many critics of Microsoft say that they are missing the boat by not putting MS Office up in the cloud to compete with Google Apps. While Microsoft may have to compete with Google one day in this space (I personally prefer offline Office + a service like SharePoint to share my documents.) that day is not today. The real battle will be over the true Cloud-infrastructure and ultimately the stack.

Selling customers on your Cloud platform locks them into your technology. So if Microsoft offers storage (SQL Server Data Services), application synchronization (Live Mesh), workflow/relying (BizTalk Services) and application tier (IIS as a service? or at least VPCs) services, they will get developers to use the Microsoft stack (SQL, .NET, etc.) for another generation. Throw in Hosted Office and Exchange, and they are really hooked.

Judging from the PDC content, with sessions all around Microsoft Cloud services, I think that they get it. Too bad we have to wait until October, but I sure hope that it is good stuff.

Yesterday Yahoo! announced a deal that will outsource their search engine to Google. For those of you who don't remember, Yahoo use to outsource their search engine to Google about 8 years go, and Google ate Yahoo's lunch. That said, this is the final nail in the Microsoft-Yahoo merger. So the real question is "what's next" for Microsoft. They have three options at a high level:

1. Go Nuclear. Launch an all out court battle against Google-Yahoo starting with a lobbying effort in Washington, DC. We saw how effective Netscape, Sun and Oracle used the US Government to bring Microsoft to heel. (And more recently Google's complaints about Vista.) Microsoft saw how effective (some say Bill Gates was never the same after that experience) the nuclear option is and may just decide to go down this route as payback for both the Yahoo hubris and the old IE trial.

2. Do nothing. Remember how big and bad AOL was 10 years ago? Netscape? They were the hot new kids on the block that was going to dethrone Microsoft. Ten years later, Microsoft is still making buckets of money, revived interest in its development platform with a new push in 2002 (.NET) and AOL is practically bankrupt and Netscape disappeared (oddly enough at the hands of AOL, sound familiar to Google-Yahoo?) Microsoft can argue that the creative destruction of the Internet companies is more of a threat to Google than themselves. The Google model has not changed in 10 years: PageRank is old and outdated (still gives you irrelevant results and forces you to search like a techie). In addition PageRank is being gamed and people are getting frustrated. People are exchanging, buying and selling links on web pages with the sole intent of manipulating search results. Someone will come up with a better system and out Google Google. (Memo, it won't be Live Search.) Microsoft can sit back and develop its Mesh and Cloud computing offerings (Web as a platform) and watch Google struggle with growing pains, more defections, US regulatory issues, and challenges from hot new startups and see where the chips fall. My guess, both MS and Google will come out ok with this strategy.

3. Acquire a large portal. This is an attractive option, but nobody has the eyeballs that Yahoo! has. Only MySpace and Facebook have the eyeballs and they have problems making money.

So if you were Steve Ballmer which would you choose?

My lunch with Bill Gates yesterday at Tech*Ed in Orlando was very cool. His first word to us was "super" as was his second.

After snapping a few photos, we got right down to it. There were about 12 of us from the community who were invited and and we were eager to chat. First question: "Hey Bill, what are you going to do with your free time?" Bill indicated that he is going to be "super" busy and will be working full time on his foundation.

We then got into talking about schools and how he envisions most schools around the world to be textbook free and just use computers. Then about how university level learning will be done via the Internet for lectures. In poor countries "best of breed" lectures can be put on DVD and repeated. Bill was blown away  by the organic chemistry distance learning made available by MIT and wants to bring this model to everyone. He said that the traditional lecture will die at the university level. He was extremely passionate about teachers, schools, and education in general.

Andrew Brust asked about the UN, and Bill complained that there were too many agencies with more TLAs than Microsoft. (WHO, WFP, etc..)

I got to finally get a word in edgewise. :) I had lots of questions sent to me by readers of this blog ranging from "What's next" to "Why not just buy the Mets, that is charity at this point."

I asked about Microfinancing. The answer surprised me. While Bill's foundation gave $300 million in total to microfinance, Bill said the micro-financing had too high of interest rates and the opportunities to make loans were not as abundant as you would think. Bill had a passion for micro-savings.

He said that too many poor people have no access to banks due to distance and bank fees. So banks become something only the rich can have access to in many countries. (Including the US in many regards too, witness check-cashing shops in the inner city.) Bill went on to say how most poor will stash their currency somewhere or buy jewelry, only to get stolen or inflated away. Or some will buy livestock as a way to store their wealth and save only to be stolen or come down with disease. Bill described a system that he worked on that will allow poor people in remote areas to make microdeposits in the bank via a local retailer. Then they can view their balance via that retailer or on their cell phone if they have one. Then can spend the money via local retailers or via an ATM. He also spoke about the need for a quality interest rate for the microsavings. This was really amazing, all you hear about these days is micro-loans, but Bill turned the tables on everyone wants to combine micro-loans with micro-bank accounts. Makes complete sense.

The last question by Kate Gregory, was on how does Bill deal with the public sector/volunteer sector's non type A personality. Bill basically indicated that he was results oriented and brings the same passion and project management skills to his non-profit work.

I can't say that I had lunch with Bill Gates since he did not really eat, we just kept asking him questions and he never really got to eat his lunch. All in all he spent about 1.5 hours with us and it was great. I have to say that it was really inspirational to talk the whole time with him about non-technical issues (not a single techie question was asked). Here is a man who is one of the greatest technical minds (still!) around, the chairman of a Fortune 500 company, and we talked about his passion for his foundation. I am looking forward to what his foundation will do with him working there full time.

Back in September, two classmates convinced me to join them on a crazy quest. Merrill Lynch and our Business School, the City University of New York at Baruch College, sponsors an annual business plan entrepreneurship contest. For a small team, write a business plan and then show how you can execute. The contest started with an elevator pitch and an abstract way back in September and 140 teams entered. Over the months you have to write a business plan and then sell it to judges who act like investors. The judges cutoff more teams as the months progressed and eventually there were 10 left for a final pitch two weeks ago.

By some miracle, my team won! Our concept is all about on-line advertising using a behavioral approach on top of demographic slicing. It is easy to implement and we are going to do so (Watch out Google!) We won a $10,000 cash prize (wow!) as well as $20,000 start-up investment for our business. In today's day and age, with technology so cheap, the Internet so ubiquitous, and overseas resources readily available, we can get to a prototype phase with the $20,000. That is the power of Web 2.5.

The best part of winning was being given the "big check" like when you win the Lotto. We took the big check to the bar with us to celebrate, however, the bartender would not cash it.

God bless the lawyers. (I never thought I would start a blog post that way.)

The way we buy cell phones in the United States is different than in almost all other major markets. The carriers (AT&T, Verizon, T-Mobile, Sprint, etc) control the market. You can only buy a phone through them and with a service plan attached to it. Not only that but the phone manufactures (Nokia, Motorola, etc) have little control as to what features they can put on the carrier's "version" of their phone. For example let's say that Nokia releases the sexy new Nokia 123456 phone. This phone has integrated bluetooth and a cool wifi feature. AT&T will sell you the 123456 phone without the wifi and Sprint may sell it to you without the bluetooth feature. You can't buy the "normal" Nokia 123456 anywhere in the United States, you have to check eBay or travel to Asia or Europe and buy an "unlocked" version (more on that in a minute.)

Europe, Asia, and the rest of the world does it differently. You can buy the Nokia 123456 at a Nokia outlet, a retail shop like Radio Shack or Circuit City, or online. It is unlocked, meaning that you can put in any GSM chip from any service provider. (By contrast US phones are locked, my AT&T phone will only work with my AT&T chip. But I can buy an unlocked European phone and put in my AT&T chip, but AT&T won't support the phone, and they get mad at me when I do this.)

So the rest of the world is free and unlocked. This leads to major consumer choice. Consumers change phones all the time and also change carriers quite often. This forces the carriers to compete on coverage, price, service, network reliability, and features (exclusive MP3 downloads, cheap wall papers, etc.) In Europe there is major innovation both at the phone level (unlocked phones have to compete with other unlocked phones) and on the carrier level. This leads to innovation and more consumer choice.

In the United States, we have no such competition. We have an oligopoly. We have expensive plans, crippled phones, and we are tied to our carrier forever. (I have been with AT&T since 1995 and I hate them!) This also explains why at 16,000' on Mt. Kilimanjaro I had service but can't get coverage on 3rd Avenue and 86th Street in Manhattan, a "dead zone" for AT&T, which is funny since an AT&T store is one block away.

In November 2007, this was promised to change. You were suppose to  be allowed to unlock your phone (funny it was illegal up until then to unlock your phone since it violated an intellectual property law).

So what did the carriers do? Take it all to court.

Good news. People started to sue. (Thank God for lawyers! Wow, I said it again.) Under threat of the lawyers, Verizon and Sprint, have agreed to unlock hones after customers have completed their original contract. (Not perfect, but a start.) AT&T and T-Mobile decided to fight on. They took their case all the way to the California Supreme Court and lost. So they appealed to the US Supreme Court.

Good news. The US Supreme Court yesterday sided with consumers. (All those Reagan and Bush arch-conservatives are good for something!) The court declined to review an October decision by the California Supreme Court that  basically cleared the way for a class action lawsuit that will allow millions of California customers to sue the carriers. (The suits also prompted all the carriers to reduce the fees charged to costumers who terminate a contract before it expires. Thank God for lawyers a third time!)

This does not unlock the phones automatically and change the US market to behave just like the rest of the world. But it is a start. We are free from the control of the carriers. Let freedom ring. Bring on the innovation!

PS iPhone users, you can finally get an unlocked iPhone!

As Bill Gates heads to retirement, he is making one last hurrah as the keynote speaker at TechEd next week in Orlando. I am lucky enough to be invited with 12 of my closest friends to have lunch with Bill after the keynote.

I was told not to ask anything controversial or not to monopolize the conversation (those who know me well will appreciate that one) but since I will be also in attendance with Richard Campbell and Andrew Brust, I will be lucky to even ask Bill how his golf handicap is going. So I have to be strategic. In an hour and a half lunch with 12 people, I can possibly get one good question with a follow up.

What would you ask Bill Gates if you could? Here is what I am thinking, leave in the comments or via email what you think is a better/worse question.

You recently said in Davos that a new style of capitalism may be needed in order to solve the world's problems. You make the case for more corporate social responsibility (CSR), so what is one major problem in the world today that you think is severe (AIDS, global warming, etc) and how can the "creative capitalism" you outlined at Davos solve it. Also would a Microsoft of say, 1980 with revenues of just over $1 million and just hired the first MBA "manager" type (Steve Ballmer) react to this positively (what is in it for MSFT '80)? Isn't "the business of business is business" and wouldn't Steve and Bill in 1980 agree? How do you motivate 1980 Bill Gates and Steve Ballmer to "creative capitalism".

Let me know if you have something better. :)

Napster just launched a digital music store that is DRM free and has 6 million MP3s to download for $ 0.99. It will not have the proprietary DRM from Apple or Microsoft on it.

"Music fans have spoken and it's clear they need the convenience, ease of use and broad interoperability of the DRM-free MP3 format," said Napster CEO Chris Gorog, "and they want to be able to find both major label artists and independent music all in one place.  Napster is delighted to deliver all of this and more with the world’s largest MP3 catalog."

This is bad news for Apple.  Apple got strong in this business because the record labels wanted DRM on the songs and Steve Jobs gave them one, one that will only work on the iPod. Jobs argued to the labels that in order to make Apple's DRM software, FairPlay, effective, it had to be proprietary. The labels agreed and the iPod was released in October 2001 along with iTunes as the first legal digital music download store. Jobs won't license FairPlay, so all music sold on iTunes can be played only on iPods. This lack of interoperability, combined with the iPod's overwhelming dominance, gives Apple a stranglehold on the digital music marketplace. How big is this stranglehold? 22% of all music sold in 2007 was sold on iTunes.

So the empire strikes back. In July 2007, Universal said it would selectively choose which songs (or albums or artists) were sold on iTunes, rather than granting iTune blanket access to the entire catalog. (This was a major blow to Apple.) In August 2007, Universal announced the plan to offer DRM-free tracks through non-Apple retailers. Amazon and Napster are now selling DRM free music in an attempt to break the stranglehold Apple has with its proprietary system.

Is this the beginning of the end of the iPod? Time for Apple to respond. It would be nice if they licensed FairPlay. Something has to change. it will be fun to see what does.

On Monday I will be speaking before representatives of the US House of Representatives about legacy systems. The question is to invest in brand new systems and technology or just to kind of glue together things on top of old systems. The question boils down to one of public policy, should the Congress pass laws mandating this, or should they give some autonomy (and budget to attract some talent) to their in-house IT staffs.

I am working with the Association for Competitive Technology on this issue. We feel that scraping the old and leapfrogging over a generation of technology or two is the best bet. Get some creative destruction on Capital Hill from new IT systems.  Treat the IT departments like a business, not a governmental agency. Give them budgets and goals and have them develop the applications and processes required. A little autonomy can go a long way.

Cable company Comcast acquired Plaxo yesterday for about $150 million. Comcast did for the same reason Microsoft wanted to buy Yahoo, eyeballs. Plaxo has a lot of members, and a popular new feature called Pulse, gives Comcast a toehold in Silicon Valley.

Was this a wise move? Probably not. Plaxo was on the block for a long time and nobody would touch them. Google was rumored for a while, then Facebook. The problem is that Plaxo is not relevant anymore. With the movement this year behind both OpenID and Data Portability, your social grid should be your to manage and in a new environment where profiles, contacts and your data is portable across platforms (Facebook, Yahoo, MySpace, etc), it is the API and applications that matter, not how many contacts you have.

Plaxo will most likely die a quiet death inside of Comcast within a few years. The good news, no more Plaxo spam.

About 13 years ago, Microsoft ruled the Earth. Windows 95 shipped to much fanfare and people were talking about a "monopoly" and how nobody could remove Microsoft from their top position- ever. Then came Netscape and the Internet, then the .com boom and then Google. Now everyone counts Microsoft out. (Mary Jo Foley and I don't agree, but that is a topic for another day.)

There was a time when GM ruled the Earth. Their market share was so dominate we could not envision a world without them. Their profits were larger than most European countries' GDP. First came the Japanese, then the Koreans (and soon the Chinese will come.) But the real death kill was the environment. Now everyone (including non-car owner me!) wants a Tesla. Now everyone counts GM out and they are probably right to do so. They will survive but struggle for relevance.

There was a time when AT&T ruled the Earth. They even had a real monopoly, but I am talking about post monopoly. They were big and had infrastructure and controlled a large portion of the long distance market. Then came Voice Over IP. Vonage was the early trend setter, then cable/fiber companies, then Skype. People keep asking me what my "work" or "home" phone number is and I say either call my cell or Skype me since I don't pay long distance or have a land line. Companies like VOIPo are just killing AT&T and other telcos. (Congratz to VOIPo for hiring such a smart CTO!) The telcos are now irrelevant. 

It has long been argued that this is all good. It is "Creative Destruction"  or the process of something new killing something old. The term was coined by Joseph Schumpeter in his 1942 book called Capitalism, Socialism and Democracy to be a "process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one."

The role technology plays in the process of creative destruction is simply amazing. I can list ten more examples but you get the point. I watch with sheer excitement when Microsoft feels that it has to "bet the farm" on some new technology or Google has to buy YouTube to stay relevant, or how they all bow to the Facebook alter (and Facebook will be made irrelevant by someone new just like Friendster and MySpace before it.) I love how 13 years go Yahoo was predicted to take over the world (along with Excite and others that have gone away) and now it is struggling for survival. My old employer Zagat is struggling to stay alive (I only half like that with my unexpired stock options still on the line <g>).

Technology is the most powerful creative destruction force and will continue to be so. The reason why I am not on the Al Gore bandwagon (despite my insistence of taking the subway everywhere) is because I have faith that the problems we are facing here in 2008 of the environment or health care will be solved with technology, motivated by the powerful market force of creative destruction. We now have a Tesla, the sexiest car on the planet. We now have targeted chemo-therapy based on your DNA, making it far more effective. What is next? I don't know but I sure what to watch it all play out.

Breaking new on CNN:

"Bill Gates one of the world's richest men, a philanthropist and humanitarian was denied an entry visa to Myanmar today in his effort to help with the victims of the Cyclone. The Military junta was worried Bill would try to buy the country. Bill Gates was very disappointed and was quoted as saying "I just wanted to help a few million people." So instead he decided to help a different million people, those who hate their friends sending them Twitter updates. Bill bought the company with some pocket change and closed it down to save humanity the pain of tech geeks micro-blogging about picking their noses. Microsoft's stock jumped 100% on the news."

Since Bill did not really save the world from Twitter, I will tell you why I don't Twitter.

1. Everyone wants to be a Microcelebrity. Get (micro) famous on Facebook, Flickr and Twiter? Only an ego the size of Silicon Valley thinks that people actually care about our daily lives. I know that I live a dull life and don't feel the need to boost my ego to Twitter and think that you actually care about it. I don't want to be a microcelebrity, if I can't get a role in a movie opposite Cameron Diaz, then screw it, I will just go back to what I am good at: writing code.

2. "I use Twitter so my wife knows if my flights are delayed." People who are way smarter than me give me this excuse. The only person who cares about your flight is the person who is picking you up at the airport, so why broadcast that to the whole community? Ever hear of an airline alert? Far more reliable then your 3G network. I use airline alerts and I take public transportation to and from the airport to offset the huge airline CO2 emissions.

3. "I use Twitter to update my status." What makes you think that anyone cares about your status? Also in the post 9/11 world, should you be broadcasting to potential criminals and terrorists your whereabouts? My DPE just checked into the San Francisco Marriott last night, maybe criminals want to go and rip him off (since they know he has iPods and expensive stuff with him due to his Twittering). Worse yet I travel to places where they kidnap businessmen for ransom or worse (like in Pakistan), should I updating my status to them?

4. "Twitter is good for Conferences." If you need to read Twitter feeds to know where the cool parties are, you should stay in your room coding and eating room service.

5. "Twitter is fun." Yes fun for people who would rather play baseball on an XBox than outside with a real ball. Twitter is a time suck and you could be using that time to ether be working (if you are Twittering at work) or just going and doing something fun. If you are doing something fun, disconnect and enjoy it. I don't care what you are eating for dinner, the score of the baseball game, or how is traffic on the I-95.

The last reason why I won't use Twitter is that it is going to fail. Meaning, micro-blogging may succeed and eventually I will have to do it  (but I have still resisted Facebook!), but Twitter won't be the platform we use. First of all it is slow and times out all the time since it is built on Rails and Rails just doesn't scale. Even if they rewrite the site, someone else will move in for the kill. Remember Friendster? They never overcame the damage of their performance problems. Second, most likely we will just alter our Blog feeds to have have micro-RSS feeds and anyone can build a client for it. No need for a central server.

We're looking to hire a few good .NET developers. Instead of the traditional way of sending in CVs (resumes), I figured we can do this Web 2.5 style. Resumes are so 20th century and Web 1.0. What can we learn about you with just a resume?

Below are 10 things I want you to send me: some easy, some hard, some fun, some coding challenges. There are no right or wrong answers this is just a way for us to get to know you. Some questions will take you 5 seconds, some may take you 5 minutes, and at least one will take you an hour (#7, but it is fun). I am looking for what drives you, where you want to go, and of course your approach to problems and how you craft a solution. For the coding questions, good coders are easy to find, I am looking for a coder who in creative (one guy once solved a TSQL problem better than the actual official solution and now I use his answer as the new solution) but also through. (Hint: check your own work a gizillion different ways, I have gotten compile errors back in the past!) I am also looking for some who takes pride in their work and goes the extra mile (or kilometer). (Hint: things like good Unit tests also give you bonus points.) After we get to know each other via this process, then I will look at your CV and we can do the traditional interview.

Good luck and HAVE FUN!

1. Send me a link to you online. Your web page, blog, MySpace profile, user group you are a member of, or a site that you worked on. Anything to get me acquainted with you. If you are reading this blog you already know me, so it is only fair. :)

2. List your top 5 values. (Why do you get out of bed in the morning? What makes you tick?)

3. List the top 3 blogs that you read and tell me why.

4. Tell me what programming language you want to learn next and why.

5. List the top 3 new features you want to see in the next version of the .NET framework (4.0) that has not been announced and tell me why you want to see them.

6. Write a short essay on the greatest failure (canceled or late project, bad code breaking the build the night before a major demo, etc) in your professional career.

7. Listen to this podcast. Reflect on it and give me your reaction to it.

8. Send me an ASP.NET project from Northwind that uses the Model View Controller design pattern. (Not the ASP .NET MVC framework.) Use the categories, products, and sales. Be creative. Bonus points if it is real easy to install.

9. A TSQL Challenge. Give me a script to solve the following problem. (Run this setup here.) There are no real wrong answers, but the more efficient and bulletproof the query is the better. No cheating and no cursors! Don't Google the answers (we'll know.) Assign rooms to classes based on capacity using the Classes and Rooms tables. Rules: each class should have a room (and NULL if a room is not available). No class can be in a room where there are more students than capacity. No room can be used twice.

The results of your SQL statement should be something like this:

10. Create a data driven ASP.NET page using the Telerik controls. Tell me something that sucks about the control you used. (I already know what is great about them.) Bonus if you find a bug. (We'll send you a .NET Ninja tee shirt if you do.)

After Microsoft walked away from its takeover bid (or maybe this is just a tactic) Yahoo's share price lost most of its takeover premium this morning and is trading about 15-20% below its closing price on Friday. (But still above the $19 it was trading immediately before Microsoft's offer.

So what is next?

Yahoo will try to do something. They fought hard to stay independent, but at what cost? Shareholders have already started to sue and the market is punishing Yahoo today. They can outsource their search to Google (like they did when Google started) and focus on using Yahoo's web properties' traffic to make money. Slash jobs by outsourcing search and increase your valuation.  Then if Microsoft comes knocking again, they can argue a higher valuation. But Microsoft most likely won't come knocking if Yahoo outsources search. (This of course if the US Congress allows the Google deal.)

Microsoft may make a move on AOL. While not as strong as Yahoo, AOL will come with the traffic to build out the Live platform and Time Warner really wants to get rid of AOL. I am not so sure that this will work, but it is possible. AOL brings far less to the table than Yahoo. I can see a MySpace play but that does not really look like it will make money, ditto for Facebook. Social networking may have the eyeballs but not the ad dollars.

That brings us back to what happened this weekend. Yahoo and Microsoft have no good options in front of them. Yahoo can't stay independent without a major change. Microsoft needs to push its ad strategy out to more eyeballs and Live is not cutting it. I think they will both be back at the table in a few months.

Microsoft released a tech preview of Live Mesh for developers today. Live Mesh is a software-plus-service platform that enables your PC and your other devices to “come alive” by making them aware of each other through the Internet. I was invited to the beta and so far I have been using the storage features and synchronization services. (Think of a Live Mesh aware TV set top device and season 4 of Lost downloaded on my PC.)

I can see road warriors like myself using Live Mesh quite often, all you have to do is upload a Word document to your virtual desktop and then it will be automatically be kept in sync on every machine and device I have. As long as it runs Microsoft operating systems, a limitation I can live with. (But support for Mac is coming soon I hear.)

While the marketing engine of Microsoft seems pointed to the consumers with their XBoxes and PCs, I think this software+services approach represents a change in direction for Microsoft. Using the software (Office 2007 + Vista) and the services (Live Mesh's synchronization and discovery services) developers can build some really cool business applications.

Not only can you sync documents and files, but you can also sync applications (via a two-way RSS or Atom feed). Once again Microsoft is showing its strength with the developer community. For example, a Web developer can build an app using any programming language and then sync that application across multiple devices and even other applications. 

Contrast this to what Google is doing. Google is trying to bring all of your applications from the desktop to the cloud. Microsoft is trying to get you to keep your desktop applications for their rich features and leverage the cloud for storage, synchronization, and collaboration. Microsoft is not pretending that we have uber powerful and cheap PCs and is using the cloud for infrastructure.

Will Live Mesh make Microsoft a player? Ray Ozzie thinks so. He has said that Microsoft now has to build software+services with a connection between devices (and their data) and people.

Its' a great time to be a developer.

This week has been a nice vacation in Thailand in between a week of work in Penang, Malaysia and two weeks starting next week in China for a school trip with my MBA class for our international study program.

Last week in Penang, I meet up with the academic staff at the computer science department at USM (University Sains Malaysia) in Penang. We had a great time talking about how to bridge the gap between the research the students are doing and commercial applications. (I suggested that they work more closely with their alumnus to come back and teach classes on this very topic.) I walked the faculty and students through the technology used at my old company, Corzen-mostly the statistical models (cluster analysis), data mining algorithms, and grid/distributed computing. The student's eyes lit up.

The whole reason why I was there was due to my friend Jihad Hammad, he invited me. Jihad was born and raised in Palestine and is taking his masters at USM. (This is his first time out of Palestine.) He is the founder of the Palestinian Information Technology Center (PIT), a non-profit to help people in Palestine learn about technology and PalDev, a Microsoft .Net User Group in Palestine-with 100+ active members at each meeting, a user group that sometimes has no place to meet so they meet at a refugee camp.

Jihad and I met online five years ago and collaborated to build the PIT and PalDev; we have been partners and friends for 5 years.I helped get the PIT center funding from various sources in the USA and helped get Microsoft recognition for the center (plus free software) as well as INETA membership for PalDev. While Jihad did all the hard work, I was able to lend him a helping hand over the years by making the right introductions to the right people.

This was the first time we met in person.

This is the power of the web, it brings people together and helps them do wonderful things. Two people who never met before can easily build trust, a friendship, and make a difference by using technology in a war zone to give people hope (and hopefully one day play a very small role in ending the violence.) This would not have been possible 10 or so years ago. That is the power of the WideOpen Web. Anything is possible, even peace in the Middle East via .NET. :)

Ok back to the mixed drinks by the beach...

All of the mainstream press is done talking about Mix last week. So I wanted to give my impression as a long time Microsoft watcher and developer.

First I have sat through hundreds if not thousands of keynotes over the last 15 years at Microsoft events. (Most recently I sat through one in Portuguese on Wednesday in Lisbon.  2700 developers, what a turn out!) Microsoft is really focused on the developer. They have a developer culture (that gets them in trouble with the mainstream press a lot) and treat developers like gold.

For all the great treatment, they will still turn up the PR engine at these keynotes, because while TechEd, PDC, and Mix maybe developer events, the press is still there. I noticed something different about Microsoft at Mix: honestly.

Case in point. In all of my years at keynotes, MS has never admitted to a mistake. They have come close by saying "Version 3.0 was slow, sorry. Version 4.0 out in XX months will be 10x faster! We rock! Cheer for us!"

They have touched some third rails like during the IE monopoly trial in the USA they brought a new computer out on stage and said "where is IE" in the middle of the demo. It was loaded with Netscape. That kind of poking fun at themselves was nice, but still not what I was looking for.

No at Mix they showed the maturity of an industry leader. They showed IE 7.0 not implementing CSS 2.1 standards. They then showed FireFox and Opera implementing it correctly. Then they said that they will fix it in IE 8 and showed us a demo to the point.

Wow.

Some of you may not think that this is a big deal. It is. It is Microsoft growing up knowing that they are not the only player out there, realizing that people depend on their stuff and they are willing to take responsibility. This is the first step in losing their arrogance.

Speaking of arrogance. That is my opinion of Apple at the moment. As a developer, the iPhone SDK is 1. late to the party, 2. not that compelling (I had similar tools for RIM 7 years ago and Palm and MS SmartPhone 5+ years ago) and 3. arrogant. I have to develop according to the Apple UI and deployment standards. Sorry Steve Jobs look in the mirror. You will see Bill Gates of 10 years ago. The person you hate is the person you just became.

A torch has been passed. Who will replace Microsoft as the arrogant one in the software space? It will take a few years for Microsoft to completely change and a few more years for that change to be accepted. I think buying Yahoo! and working in a mature manner with Yahoo! is the first step. Who will replace Microsoft? The likely candidates: Google or Apple.

I have been working with web technology since the earliest days of the commercial web. I remember back about 15 years ago learning HTML and basically making a fool of myself with my personal home page and talking myself into a job at Fidelity Investments in 1994 saying I knew this thing called HTML. I remember about 13 years ago using raw ODBC via CGI scripts to make data from a database appear on a web page. Then came OLE ISAPI and life got a little easier-but you had to code the page yourself (like do all the response.* stuff that ASPx does automatically for you today).

What I remember for most of my time as a developer is how hard the web was to code for. Around 1995 I tried to tell customers (I was construing then) that the web was a passing fad to avoid building web apps. (they did not believe me.) The tools were immature (Visual Notepad 1.0) the IDEs just sucked (remember HotDog?) and all the APIs were out of process. Then along came a beta for IIS 1.0 sometime I think 12 years ago. I still remember where I was when I first saw it. I was in Chicago at a developer conference. Things started to get easier.

Back around 1996 programming for the web was better but still quite a challenge. At the same time, Java was threatening Microsoft. Netscape was the darling of Wall Street and the geeks. Microsoft's back was against the wall. There was an anti-trust lawsuit. People said that they were big and mean (and they were mean at times!) and could not adapt to the Internet. The Internet would make Microsoft unimportant.

Microsoft responded. Code named Denali, Active Server Pages and ActiveX Data Objects gave us an in-process way to code pages with a framework on top of ISAPI, gone were the days of having to write the pluming. Tools started to come along, Visual InterDev was a good first attempt and then the evolution of Visual Studio. The Java folkes were jealous of the MS IDEs. Coding for the web just got way easier.

This helped fuel the .COM boom. IIS was so innovative (the only web server at the time to be out of process), the IDEs were so much easier, and scaling to a web farm was so cost efficient, Microsoft set a new standard in web development. Microsoft technology lead the way during the boom, others were big players but by 2001 people were actually starting to play catch up to Microsoft when they put .NET to beta. How about that for not being unimportant?

Well fast forward 7 or 8 years.  I was at the New York Windows Server 2008, Visual Studio 2008, and SQL Server 2008 launch today and headed to Mix 2008 tomorrow. I look at the way we code web pages today and it is 10 times easier than the .com era! Maybe more!

The likes of Google and open source-ers have claimed that Microsoft is again unimportant. Goolge is the darling of Wall Street and the geeks. Linux and open source have their religious zeal. Microsoft faces anti-trust in Europe. Sure Google owns the online ad space. Great, they can have it. Wall Street and the lay press have stated that Microsoft is behind Google because it is in third place for Ads on the Web. They say that Microsoft was asleep behind the wheel. I beg to differ. Let's take a look at some of the technology that the boys and girls from Redmond have produced in recent months:

• The .NET Framework and the 3.5 extensions (WF, WCF, ASP Ajax, and ASP.NET MVC Framework)
• Visual Studio 2008, the slickest IDE out there
• SharePoint
• Silverlight

Not to mention all of the back end stuff like Windows Server 2008 and SQL Server 2008 all with supporting technology like LINQ and XLINQ.

Holy cow is developing for the web easy! Not only easier, but developers have more unprecedented power. When you compare the Java and Open Source offerings of .NET, Visual Studio, SharePoint, Windows, SQL Server, and Silverlight, there is no stack that even comes close in power and productivity. Not bad for the "unimportant" Microsoft.

Case in point. I started a new business in December. Something very speculative and it needed a large data driven user interactive transactional web site. Back 10 years ago, I would have had to make up some PowerPoint slides and beg angel investors for a few hundred thousand dollars to build out a proof of concept. It would then take six months to get to an alpha since debugging would consist of CTRL+G and counting down to the response.write("strSQL"). The UI was painful for users and very static.

Now due to infrastructure reasons like cheap bandwidth, outsourcing, and tools like Skype and IM, you can do this much cheaper. But Microsoft has made the development light years ahead of the .com era.

Remember my new startup? We have an Ajax enabled Microsoft .NET 3.5 ASPx site up and in customer ready beta today, in only two months. One architect, one developer, and one tester. That is 200% faster than my last startup Corzen which was built on top of the .NET 1.0 stack 6 years ago and 500% faster than a comparable web site build in the .com era for Zagat on the last ASP stack. All that and no begging any Angel investors, it was so cheap we paid for it ourselves!

Google may own Sillicon Valley and Wall Street, but Microsoft owns the majority of developers hearts and minds. They own it because they make our life so damn easy. Microsoft has thrown the web wide open to everyone. If you can get a new business started in 2 months on the Microsoft stack, think about all the great things that people will do!

Looking forward to the next stack in a few years from Microsoft and looking back at this current stack as slow and out of date like I do the .NET 1.0 stack. Maybe it will only take me 1 month to start a new business. :)

Google's co-founder Sergey Brin said on Sunday that Microsoft's proposed takeover of Yahoo! is an "unnerving" maneuver that threatens innovation on the Internet. Brin stated:

"The Internet has evolved from open standards, having a diversity of companies... And when you start to have companies that control the operating system, control the browsers, they really tie up the top Web sites, and can be used to manipulate stuff in various ways. I think that's unnerving."

Get a grip Sergey. This sort of scare tactic could have worked 10 years ago before Web 2.0 and before there was a serious threat to Microsoft on the Internet called Google. Google is a huge company that has an over 70% market share. Microsoft has a tiny market share, even with the combined Yahoo, Microsoft-Yahoo will still be very far behind Google.

Microsoft's hold on the desktop and browser for the last 10 years has not made it any more powerful in the 2008 Web 2.0 world. They are distant third place in search and losing ground. They are no longer the evil empire.

Google is the new evil empire. They are big, they control a ton of eyeballs and many people in the valley are now saying that Google is very difficult to deal with. Microsoft is just another player in the Internet space, Google is bringing up old battle cry's from yesteryear. Sergey better watch out, the Department of Justice may just come after him in a few years. Don't think so? Bill Gates never thought so.

Today Toshiba announced the death of HD DVD saying that it will no longer produce HD DVD players. While a standards war between Toshiba's HD DVD and SONY's Blu-Ray was in full swing, Blu-Ray emerged today as the winner. The death of HD DVD was very quick, here is how it happened:

• Popularity of SONY Playstation 3 at Christmas
• Warner Brothers pulling out of the format leading to limited Selection of HD DVDs titles
• Netflix going Blu-Ray exclusive

I think the tipping point was Netflix going exclusive. With Warner Brothers out and Paramount rumored, the writing was on the wall. It took 8 days from the Netflix announcement to the actual tossing in of the towel by Toshiba. Score one for the power of the people. Once Netflix spoke on behalf of its members, HD DVD died.

Blu-ray will have to compete hard against high-def Internet downloads. With a lot of the public not willing to pay over $30 for a new Blu-ray disk movie (compared to a $10 DVD) and new players being expensive;  hard drive space being super cheap and broadband also ubiquitous and cheap, Blu-ray will have a major fight on its hands. Expect a repeat of the MP3 Napster debate from 10 years ago.

Business models will have to change. Will the movie/DVD industry learn anything from the music/CD industry? I doubt it.

According to the Alley Insider, Yahoo's second largest shareholder, investor firm Legg Mason, has met with Steve Ballmer and supports a bump in the price and thinks that Yahoo should take it. Legg Mason outlined in a letter to shareholders that Microsoft will offer better value than Yahoo can deliver on its own. If you remember Microsoft offered $36 last summer. Expect them to go at least this high, if not higher. (They most likely were prepared to pay this high already.) The Google-Yahoo deal has went cold according to the Wall Street Journal, so Yahoo has very little in the way of options.

Brilliant strategy by Microsoft. Come in at a low point when Yahoo is laying off 1,000 workers with a low bid. Get the shareholders excited, have the board reject the offer and then up the bid. Not the board of directors is stuck between a rock and a hard place. Or between a Google and a Microsoft.

When it looks like this deal will go through, I will post why I am such a strong supported of it and counter all the anti-deal.

Over the weekend Yahoo! board members leaked to the Wall Street Journal that they felt that the Microsoft bid of $31 a share is "massively undervalued." Yahoo then officially rejected Microsoft's bid on Monday. What happened is that Yahoo's management convinced the board of directors not to sell at $31. But Yahoo shareholders want to earn that $31 or more. So Yahoo said the offer was "massively undervalued" and that $40 is what they want. Microsoft responded by saying that $31 is a full and fair deal and that Yahoo's counter offer of $40 is "Absurdly High." This is the classic negotiation tactic know as anchoring.

Microsoft is not backing down. Steve Ballmer said he is willing to go higher. Negotiation statistics say that in cases like this firms usually "split the difference" and would settle for around $35 a share. But Microsoft is also pulling no stops, they are hiring a proxy firm to start a hostile takeover. This is knows as Microsoft's BATNA or "best alternative to a negotiated agreement." It is the stick to the upping the price carrot.

Microsoft is offering Yahoo a solid premium over its true valuation. Since there are no other bidders and Yahoo's financial position is weak at the moment, Yahoo has very little leverage. Yahoo's only other option (BATNA) is to have massive layoffs (some scenarios put it at 33% of the company) and potentially outsource search and advertising to Google. (We all saw how that worked for AOL, moving from 20% to 5%.) Actually according to the Alley Insider, Microsoft's premium is rather large: RBC's Jordan Rohan has said: Yahoo is valued at about $24. That would put Microsoft's bid at an approximately 30% premium. Shareholders like 30% premiums. They also don't like when board of directors let pride get in the way of a fail deal to earn 30% on their money (epically with the Dow down 14% this year.) They tend to have shareholder revolts when board of directors do that. Microsoft is already talking to large investors to get them on their side. According to the Alley Insider:

• Mutual fund giant T. Rowe Price, which owns 18 million shares of Yahoo! said yesterday that it would be "very vocal" if Microsoft raises its offer and Yahoo! rejects it again.
• Capital Research and Management, Yahoo!'s largest investor with a recently raised stake of 11.6 percent, is said to favor a deal as well.

Once again, my prediction is that the deal will go through. Yahoo has nowhere to turn. Its large shareholders are going to be angry if the board rejects another offer. Microsoft has to fight the new evil empire Google and will up the ante. This is going to be fun to watch.

Yahoo!'s board of directors is to meet today to decide the fate of the company. There is a lack of an alternative suitor since the only viable one, Softbank, bailed out today. Microsoft CEO Steve Ballmer said in Business Week that the Yahoo! brand will "live on" which means the death of MSN and possible the Live! brand as well.

Yahoo!'s only other option is a deal with Google and try to stay independent. They would have outsource the search and ad functionality to Google and shut down that operation, laying off thousands (some estimates are 33% or more of the company) and focusing on the portal/content side of the business.

AOL did that. It did not work out well for them, they lost drastic market share and have never recovered. If Yahoo! did the same and lost market share, then they would be ceding eyeballs to Google.

My gut tells me that Yahoo! is not going to make the same mistake twice. It is Yahoo! that put Google on the map. Yahoo! outsourced their search to Google in the early days of Google and Google eventually took all the market share away. Why would all those smart people make the same mistake twice? My gut tells me that Ballmer has assured them of independence and they will swallow their pride and take the deal.

As a Microsoft watcher, I am excited about the deal. Here is my message to Microsoft: Don't mess this up! The whole world is watching. Microsoft is the "evil empire" in Silicon Valley. Everyone hates Microsoft there. If Microsoft handles Yahoo! right it is a historic opportunity for Microsoft to win the hearts and minds of the Valley. If they mess up the brand (think of this: Microsoft Yahoo! MSN Live! Messenger for Workgroups Professional Edition 2008 Service Pack 2a) and come in all arrogant and have tremendous layoffs, then why bother? If Microsoft handles this in a great way and wins over the hearts and minds of Yahoo! employees (who all hate Microsoft) then it is the first step in repositioning itself in the Valley. The new new evil empire in the Valley will be Google.

Google is afraid of the potential of a Microsoft acquisition of Yahoo. On Sunday, Google posted a reaction on the takeover deal. Google's reply is well, amusing.

They cry wolf.They say that the deal is uncompetitive. I find that hard to accept when Microsoft+ Yahoo= a tiny fraction of Google's market share in ad and search traffic. They are also crying foul saying that Microsoft is the big evil machine. This is an easy thing to do in the valley. Everyone hates Microsoft in the valley. Flickr even has a protest group. The valley is home to the anti-Microsoft camp: Oracle, Sun, Apple, and Google. Lots of people in Silicon Valley will automatically say "Microsoft is Evil!" when prompted just as people will automatically say "Down with Bush!" when promoted at a Clinton rally. Why do they hate Microsoft? They are the "evil empire" of course. Microsoft is big, owns too much market share, and is arrogant according to the valley faithful.

But Google has to look in the mirror. They are the big 800 lb gorilla everyone is afraid of! Not Yahoo, not Microsoft!

Google is the reason that Yahoo has failed as a company and is a takeover target. Yahoo use to be the sizzle of the Internet, now Google destroyed them. Google is the reason why the most profitable company of all time, Microsoft, is scared and doing such  a bold move. Yahoo may be Microsoft’s last hope to be a meaningful player on in a Web.20 world. Who's to blame? Google. Google is the big bad machine nowadays.

Back to the deal, Yahoo has three choices.

First they can ride out the offer and try to stay independent. That is unlikely since the company is in such deep trouble. They may also face shareholder lawsuits if they reject Microsoft's offer. Maybe they can take hedge fund money or be acquired by an European telecom or take money from a sovereign wealth fund.

Second they can outsource their search and ads to Google and focus on being a portal. They may raise their revenue by 25% in doing so according to the Wall Street Journal. This would be a total surrender. (Remember it was Yahoo that put Google on the map!) The DOJ may get involved in this case since Google would own search except for smaller players like MSN and Ask.

Third option is to take the Microsoft offer. This is the most likely outcome.

There is likely to be some DOJ action on this case, however, a Yahoo-Microsoft deal would make an actual attractive competitor to Google. Absent of the deal, Yahoo has to do something, most likely outsource the search and ads to Google. Google could be a very dangerous company without any real competition (Microsoft's AdCenter is a poor competitor) in the search advertising space. They would be more evil then Microsoft on the desktop.

Google knows this. This is why their CEO phoned Yahoo and said that they will give Yahoo any "help" they need to fight off the takeover. The status quo suits Google well. That is why they are arguing for it.

But there is no more status quo. If the DOJ blocks the deal and Yahoo remains independent, Yahoo will not remain independent for much longer. Someone else will acquire them, Yahoo is in too much trouble.

Google is afraid. They should be. Their world is about to change drastically. Their share price dropped almost 10% since this deal was announced. If the deal goes through, Microsoft will eventually lose the evil empire title and Google will be crowned the new king of evil. Funny since their motto is "do no evil."

After watching Facebook's popularity jump with the release of its applications and API, MySpace is releasing its own API for developers on February 5th. Developers can sign up here.The platform will be interoperable with Google’s OpenSocial platform, so applications written for OpenSocial will work on MySpace.

This is a smart move for MySpace. The next version of the Web, Web 2.5, is all about making your site/network as a platform. Think of MySpace and Facebook as MSDOS back in the day. Now that data interoperability is starting to happen (Microsoft is the latest to join the Data Portability Group), sites will compete on the quality of their APIs and ability to attract developers to their platform, not how many users data they keep locked up.

I can see in the future more data/infrastructure sites providing backend social networking services (profile and login via OpenID, storage, social networking software, etc)via web services for front-end sites that focus on the user experience, API and attracting developers. One day Facebook and MySpace may even outsource their storage, profile, and social networking pieces and focus on their API.

The dot com era was crazy. Companies that had no business plan, no revenue, no customers, but a great team, web site and investors would IPO for $100 million. Everyone had stock options and got rich on paper. Once all of these companies went bankrupt and were delisted in the crash of April 2000, everyone was poor again since their options were underwater and worthless. The common phrase is “I wallpapered my house with my useless stock options.”

I too wallpapered my apartment with Zagat Survey stock options. I was the Chief Technology Officer for two years during the .com era and saw it all. I got there as a consultant in 1998 when the company had just 30 employees and the server for the web site was under Sal’s desk. (Sal being the entire IT department at the time.) When I joined as CTO in late 1999, I helped with my colleagues secure $34 million in Venture funding from General Atlantic and Kleiner Perkins and build a great team.

The place became a true .com with 27 year old Harvard MBAs running around, employees bringing in their dogs to work, an air hockey table, and a web site that had one mission: drive traffic. The company swelled up to 200 people, but I build out an amazing web farm and an .NET application a year before .NET shipped. We filed for an IPO. Then the crash happened. I then had to preside over massive layoffs and the eventual loss of my own motivation and left in January 2002 to start Corzen.

Today it was announced that Zagat is up for sale and at a valuation of at least $200 million. When General Atlantic and KPCB invested in the height of the .com bubble, Zagat was valued at $96 million. That means that all the employees and former employees with vested stock options (including myself) now have .com options that are above water. Well above water. I am going to scrape down the wallpaper and deposit them into my brokerage account (I hope Fidelity Investments does not mind the glue.) I guess the .com era is not over if some companies are still paying out.

Why would Zagat sell? They do a nice little business of book sales (estimated 5.5 million books sold a year) and online paid subscriptions. The problem is that Zagat is so Web 1.0. While it is technically user generated content (the ratings are not by reviews, but surveys), Zagat is still stuck in the Web 1.0 mindset (no-one pays for content anymore! Wait that was Web 1.0 too!) and has to compete with Chowhound, Facebook applications, blogs, and scores of other user generated sites. Its business model is obsolete in a Web 2.0 world. It is adapt or die. Or adapt or sell to the highest bidder and let them figure out how to make Zagat 2.0.

In Saudi Arabia, a country not known for its openness, blogger Fouad al-Farhan has said: “The television stations are completely owned by the government. The newspapers are highly censored, and some of their chief editors have been in their positions for more than 30 years.” Fouad has found a way around the establishment and censorship: a way to have his voice heard, and a way to have his ideas expressed directly to the Saudi Government and the world. He does this through his blog.

On December 10^th 2007, he was jailed for “violating the rules of the kingdom” or basically expressing free speech. US President George Bush is due in Saudi Arabia this week on a tour of the Middle East. While he is there, President Bush is going to press the Saudi Arabia leaders to release Fouad.

The President of the United States, one of the most powerful men in the world, is going to come to the defense of a normal Saudi citizen who he has never met.  A blogger. On January 10^th, Reporters without Borders sent an open letter to the Saudi Monarchy asking to have Fouad released. A reporter? No, a blogger.

Then on Friday, Wei Wenhua, a blogger in China, was reporting about a confrontation between local authorities and the villagers. He was filming the happenings for his blog and then was beaten to death by the police. CNN has reported that “thousands expressing outrage in Chinese Internet chat rooms, often the only outlet for public criticism of the government.”

These two incidents have shown us the power of technology. Authoritarian regimes have successfully suppressed free speech throughout the course of human history. For the first time in human history, the tide has turned; the authoritarian regimes can’t fight the blogs. For the first time in human history, the masses have the edge. Sure China can censor Google and run tons of pattern recognition software to disallow blogs and other Internet media, but as soon as they ban one, another will come up. It is similar to the RIAA and Record Companies suing Napster and College Students. Authoritarian regimes now have to cope with their citizens now having a voice. A voice heard by the entire world.

Get ready for Civil Disobedience 2.0.

Everyone sends me Facebook requests. I don’t reply since I am not a member of Facebook. I am not a member of Facebook because my sixdegrees, Friendster, MySpace, Plaxo, LinkedIn and countless other memberships have went nowhere. Just because Facebook has a few added bells and whistles, why should I join?

Let’s say that Richard Campbell wears me down (who sends me more requests to join Facebook then my 17 year old god-daughter) and I join Facebook. If I joined I would want to be cool and have 300 “friends” or whatever they call them over there on the first day. It would be cool if I can press a button and my LinkedIn contacts would be imported automatically, or from Plaxo, etc.

Well uber blogger Robert Scoble was trying to do something like that. He was running an alpha feature of Plaxo Plus that went up against Facebook to scrape your contacts. Facebook banned him. Scoble authorized Plaxo to log into Facebook and get his data. It is HIS DATA, yet he got banned for trying to access it via Plaxo. Facebook does not own the data, Robert Scoble does.

This is not the way to start the new year, closing your site to your own users who just want to export their data. Facebook’s api should allow this (it does not allow the export of an email address.) Scoble has since had his account reinstated, but not before comparing himself to Gandhi (please!).

I am sick and tired of not having profile and data portability on the internet. Google has supported the OpenID but that just gets you in the door, what about bringing my data with me or interoperability between different sites. If Richard Campbell is a member of Plaxo and LinkedIn and is my business “pulse“ on Plaxo, he should automatically be my “contact” on LinkedIn if we both agree in a semi-automated way.

So, Facebook should open up! Allow the masses to have data portability. Earlier today Chris Saad from the DataPortability Work Group issued an open invitation to Facebook to join with them in working towards data interoperability. (Note to Facebook: Yahoo, Myspace,  and several others are already onboard. )