Lenovo India is continuing to bet heavily on retail and is in the process of providing a face-lift to its existing retail outlets. The vendor plans to provide uniform look and feel for all Lenovo Exclusive Stores (LES) in the country.
"We have almost finished remodeling two of our existing partner stores, and based on the feedback we will be introducing a uniform look and feel for all stores across the country," said Ramprasad L, Vice President, Transactional Sales, Lenovo India.
Lenovo has around 156 LESs across the country and over 350 business partners. "For the B-and C- class cities and for certain pockets in metros, we will have scaled down models. We are ensuring that every one of these stores, irrespective of its size, will look similar across the country," he added.
The vendor is betting heavily on netbooks being sold through retail and is also planning to launch nettops in the country. "We will soon have the Lenovo H200, which will sport an Atom processor, and will be priced aggressively and sold through our retail partners," Ramprasad said.
Thursday, January 8, 2009
Information Technology Industry
The IT industry includes such products and services as software, telecommunications, wireless, Internet, hardware, peripherals, and computer and data services. 1• Software and hardware segments of the industry accounted for 12.57% of total GDP in 2001. 2• The commercial software industry of 2003 was a $175 billion economic engine with 2.3 million jobs worldwide. 3• IT is both a distinct industry, and, according to the U.S. Bureau of Labor Statistics, a subset of Manufacturing, Transportation, and Business Services. • 92% of all IT workers are in non-information technology companies including companies engaged in health care services, real estate, insurance, and financial services; 80% of them are in small companies outside the IT industry. 4• Over the last 30 years, an investment of $11 trillion has been made in information technology globally. The major achievements have been in productivity, manufacturing efficiencies, and education applications. 5• Seven of the top thirty fastest growing occupations are projected to be IT-related. 6• The computer systems design and related services industry is expected to be one of the top 10 fastest growing industries in the economy, adding more than 600,000 jobs between 2002 and 2012.7• Employment in the telecommunications industry is expected to increase by 7 percent between 2002 and 2012. 81U.S. Bureau of Labor Statistics (BLS), Career Guide to Industries 2004-05.2U.S. Bureau of Economic Analysis, www.bea.gov/bea/dn2/home/gdpbyindy.htm.3“Enabling Tomorrow’s Innovation,” IDC White Paper and Business Software Alliance CEO Opinion Poll, October 2003, p. III. www.globaltechsummit.net/press/IDC-CEOSurvey-2003.pdf.4ITAA Workforce Survey.5“Enabling Tomorrow’s Innovation, ” p. III. 6BLS, Daniel Hecker, “Occupational employment projections to 2012,” Monthly Labor Review, February 2004, p. 100.7BLS, Career Guide to Industries 2004-05.8Ibid.
Information Technology Industry2Updated 3/25/04etaEMPLOYMENT AND TRAINING ADMINISTRATIONUNITED STATES DEPARTMENT OF LABOR• All seven of the fastest growing IT jobs (Network systems and data communications analyst; Computer software engineer, applications; Computer software engineer, systems software; Database administrator; Computer systems analyst; Network and computer systems administrator; Computer and information systems manager) require at least a bachelor’s degree. 9• Nine percent of CIOs at U.S. companies plan to increase their IT hiring in the fourth quarter of 2003.109BLS, National Projections Data Matrix, www.bls.gov/emp/home.htm.10Robert Half Technology, Press Release, August 2003, www.roberthalftechnology.com/PressRoom?LOBName=RHIC&releaseid=371.
Information Technology Industry2Updated 3/25/04etaEMPLOYMENT AND TRAINING ADMINISTRATIONUNITED STATES DEPARTMENT OF LABOR• All seven of the fastest growing IT jobs (Network systems and data communications analyst; Computer software engineer, applications; Computer software engineer, systems software; Database administrator; Computer systems analyst; Network and computer systems administrator; Computer and information systems manager) require at least a bachelor’s degree. 9• Nine percent of CIOs at U.S. companies plan to increase their IT hiring in the fourth quarter of 2003.109BLS, National Projections Data Matrix, www.bls.gov/emp/home.htm.10Robert Half Technology, Press Release, August 2003, www.roberthalftechnology.com/PressRoom?LOBName=RHIC&releaseid=371.
IT FACTS NEWS
Computer science course enrollment, test scores, and computer-use figures indicate a disparity between boys and girls in technology. Research indicates that girls are more likely to take lower-end computing classes (e.g., data entry or word processing), less likely to identify computer science as a possible college major, and less likely to use computers on a weekly basis.
AAUW, Gender Gaps: Where Schools Still Fail Our Children, 1998
Girls display what one researcher calls "computer reticence," in part because culture and stereotypes steer them away from machines.
R. Hartigan, "Girls Byte Back," Teacher Magazine, April 1999, and N. Bloom, "Why Do Fewer Women Choose Computing Careers?" Boston Software News, March 1999
More personal computers were purchased for homes with boys than for homes with girls. This results in boys getting more experience with computers and thus being more comfortable with them.
R. Hartigan, "Girls Byte Back," Teacher Magazine, April 1999, and N. Bloom, "Why Do Fewer Women Choose Computing Careers?" Boston Software News, March 1999
A 1994 study of high school students found that the lack of knowledge of technological careers, the failure to connect what students were doing in class with future careers, and the lack of a sense of economic realities were particularly discouraging to girls, because they had less information about technology from experiences outside school.
S. Silverman and A. Pritchard, "Building Their Future: Girls and Technology Education in Connecticut," Journal of Technology Education 7 (1996)
There is a major difference in attitude between girls who chose to take technology education and those who did not; only a few girls were willing to be "pathbreakers" and challenge stereotypes about nontraditional careers for women. Most girls could not picture themselves in technological jobs and were reluctant to be in classes where they were one of the few girls.
S. Silverman and A. Pritchard, "Building Their Future: Girls and Technology Education in Connecticut," Journal of Technology Education 7 (1996)
Girls represent 17 percent of the Computer Science "AP" test takers, and less than 1 in 10 of the higher level Computer Science "AB" test takers.
AAUW Educational Foundation
Tech-Savvy: Educating Girls in the New Computer Age , 2000
Women are roughly 20 percent of IT professionals.
AAUW Educational Foundation
Tech-Savvy: Educating Girls in the New Computer Age , 2000
Women receive less than 28 percent of the computer science bachelor's degrees, down from a high of 37 percent in 1984. Computer science is the only field in which women's participation has actually decreased over time.
AAUW Educational Foundation
Tech-Savvy: Educating Girls in the New Computer Age, 2000
Women make up just 9 percent of the recipients of engineering-related bachelor's degrees.
AAUW Educational Foundation
Tech-Savvy: Educating Girls in the New Computer Age, 2000
Occupations which did not exist at the beginning of the 20th Century, computer scientists and analysts, for example, have become increasingly important in the information technology revolution. Yet, women's employment in this important field is actually falling behind, widening the occupational gap between women and men.
U.S. Department of Labor
Future Work Trends and Challenges for Work in the 21st Century, 1999
Nearly 75% of tomorrow's jobs will require use of computers; fewer than 33% of participants in computer courses and related activities are girls.
Bureau of Labor Statistics (U.S. Dept. of Labor)
Occupational Outlook Handbook, 2000-01 Edition, February 2000
Sixteen percent fewer girls than boys reported ever talking to their parents about science and technology issues.
National Science Foundation.
Women, Minorities, and People with Disabilities in Science and Engineering: 1994
Computers and computer games are marketed almost exclusively to boys, and even those games purportedly for both sexes, such as elementary math software, reflect sexist attitudes: only 12 percent of the characters in such games are female, even then they are generally portrayed as either a mother or a princess.
R. Hartigan, "Girls Byte Back," Teacher Magazine, April 1999, and N. Bloom, "Why Do Fewer Women Choose Computing Careers?" Boston Software News, March 1999
More personal computers were purchased for homes with boys than for homes with girls. This results in boys getting more experience with computers and thus being more comfortable with them.
R. Hartigan, "Girls Byte Back," Teacher Magazine, April 1999, and N. Bloom, "Why Do Fewer Women Choose Computing Careers?" Boston Software News, March 1999
A 1994 study of high school students found that the lack of knowledge of technological careers, the failure to connect what students were doing in class with future careers, and the lack of a sense of economic realities were particularly discouraging to girls, because they had less information about technology from experiences outside school.
S. Silverman and A. Pritchard, "Building Their Future: Girls and Technology Education in Connecticut," Journal of Technology Education 7 (1996)
There is a major difference in attitude between girls who chose to take technology education and those who did not; only a few girls were willing to be "pathbreakers" and challenge stereotypes about nontraditional careers for women. Most girls could not picture themselves in technological jobs and were reluctant to be in classes where they were one of the few girls.
S. Silverman and A. Pritchard, "Building Their Future: Girls and Technology Education in Connecticut," Journal of Technology Education 7 (1996)
Females score slightly higher in computation, males slightly higher in complex problem solving, and there are no differences in math concepts.
Girls and Math: Enough is Known for Action, by Patricia B. Campbell, Ph.D.
AAUW, Gender Gaps: Where Schools Still Fail Our Children, 1998
Girls display what one researcher calls "computer reticence," in part because culture and stereotypes steer them away from machines.
R. Hartigan, "Girls Byte Back," Teacher Magazine, April 1999, and N. Bloom, "Why Do Fewer Women Choose Computing Careers?" Boston Software News, March 1999
More personal computers were purchased for homes with boys than for homes with girls. This results in boys getting more experience with computers and thus being more comfortable with them.
R. Hartigan, "Girls Byte Back," Teacher Magazine, April 1999, and N. Bloom, "Why Do Fewer Women Choose Computing Careers?" Boston Software News, March 1999
A 1994 study of high school students found that the lack of knowledge of technological careers, the failure to connect what students were doing in class with future careers, and the lack of a sense of economic realities were particularly discouraging to girls, because they had less information about technology from experiences outside school.
S. Silverman and A. Pritchard, "Building Their Future: Girls and Technology Education in Connecticut," Journal of Technology Education 7 (1996)
There is a major difference in attitude between girls who chose to take technology education and those who did not; only a few girls were willing to be "pathbreakers" and challenge stereotypes about nontraditional careers for women. Most girls could not picture themselves in technological jobs and were reluctant to be in classes where they were one of the few girls.
S. Silverman and A. Pritchard, "Building Their Future: Girls and Technology Education in Connecticut," Journal of Technology Education 7 (1996)
Girls represent 17 percent of the Computer Science "AP" test takers, and less than 1 in 10 of the higher level Computer Science "AB" test takers.
AAUW Educational Foundation
Tech-Savvy: Educating Girls in the New Computer Age , 2000
Women are roughly 20 percent of IT professionals.
AAUW Educational Foundation
Tech-Savvy: Educating Girls in the New Computer Age , 2000
Women receive less than 28 percent of the computer science bachelor's degrees, down from a high of 37 percent in 1984. Computer science is the only field in which women's participation has actually decreased over time.
AAUW Educational Foundation
Tech-Savvy: Educating Girls in the New Computer Age, 2000
Women make up just 9 percent of the recipients of engineering-related bachelor's degrees.
AAUW Educational Foundation
Tech-Savvy: Educating Girls in the New Computer Age, 2000
Occupations which did not exist at the beginning of the 20th Century, computer scientists and analysts, for example, have become increasingly important in the information technology revolution. Yet, women's employment in this important field is actually falling behind, widening the occupational gap between women and men.
U.S. Department of Labor
Future Work Trends and Challenges for Work in the 21st Century, 1999
Nearly 75% of tomorrow's jobs will require use of computers; fewer than 33% of participants in computer courses and related activities are girls.
Bureau of Labor Statistics (U.S. Dept. of Labor)
Occupational Outlook Handbook, 2000-01 Edition, February 2000
Sixteen percent fewer girls than boys reported ever talking to their parents about science and technology issues.
National Science Foundation.
Women, Minorities, and People with Disabilities in Science and Engineering: 1994
Computers and computer games are marketed almost exclusively to boys, and even those games purportedly for both sexes, such as elementary math software, reflect sexist attitudes: only 12 percent of the characters in such games are female, even then they are generally portrayed as either a mother or a princess.
R. Hartigan, "Girls Byte Back," Teacher Magazine, April 1999, and N. Bloom, "Why Do Fewer Women Choose Computing Careers?" Boston Software News, March 1999
More personal computers were purchased for homes with boys than for homes with girls. This results in boys getting more experience with computers and thus being more comfortable with them.
R. Hartigan, "Girls Byte Back," Teacher Magazine, April 1999, and N. Bloom, "Why Do Fewer Women Choose Computing Careers?" Boston Software News, March 1999
A 1994 study of high school students found that the lack of knowledge of technological careers, the failure to connect what students were doing in class with future careers, and the lack of a sense of economic realities were particularly discouraging to girls, because they had less information about technology from experiences outside school.
S. Silverman and A. Pritchard, "Building Their Future: Girls and Technology Education in Connecticut," Journal of Technology Education 7 (1996)
There is a major difference in attitude between girls who chose to take technology education and those who did not; only a few girls were willing to be "pathbreakers" and challenge stereotypes about nontraditional careers for women. Most girls could not picture themselves in technological jobs and were reluctant to be in classes where they were one of the few girls.
S. Silverman and A. Pritchard, "Building Their Future: Girls and Technology Education in Connecticut," Journal of Technology Education 7 (1996)
Females score slightly higher in computation, males slightly higher in complex problem solving, and there are no differences in math concepts.
Girls and Math: Enough is Known for Action, by Patricia B. Campbell, Ph.D.
Tuesday, January 6, 2009
The secret pioneers
Some of the boldest early steps into the computer age were taken in Britain. Alan Turing, the father of modern computing, did his main work at Cambridge University before joining the team of code-breakers at Bletchley Park near Milton Keynes.
By designing a huge machine now generally regarded as the world's first programmable electronic computer, the then Post Office Research Branch played a crucial but secret role in helping to win the Second World War. The purpose of Colossus was to decipher messages that came in on a German cipher machine, called the Lorenz SZ.
The original Colossus used a vast array of telephone exchange parts together with 1,500 electronic valves and was the size of a small room, weighing around a ton. This 'string and sealing wax affair' could process 5,000 characters a second to run through the many millions of possible settings for the code wheels on the Lorenz system in hours - rather than weeks.
Both machines were designed and constructed by a Post Office Research team headed by Tommy Flowers at Dollis Hill and transported to the secret code-breaking centre at Bletchley Park, near Milton Keynes, where it was demonstrated on December 8, 1943. We have to fast forward nearly thirty years to 1972 for the arrival of the first desktop all-in-one computer, which are more familar to us today. That honour falls to the HP9830. But unfortunately few people got to hear about it because Hewlett Packard marketed it primarily to scientists and engineers - by nature very quiet people!
Colossus (1941) : inside the machine
During the Second World War the Germans used a Lorenz encoding teleprinter to transmit their high-command radio messages. The teleprinter used something called the 5-bit Baudot code, which enciphered the original text by adding to it successively two characters before transmission. The same two characters were applied to the received text at the other end to reveal the original message.
Gilbert Vernam had developed this scheme in America, using two synchronised tapes to generate the additional random characters. Lorenz replaced the tapes with mechanical gearing - so it wasn't a genuinely random sequence - just extremely complex.
But in August 1941 the Germans made a bad mistake. A tired operator sent almost the same message again, using the same wheel settings. It meant the British were able to calculate the logical structure inside the Lorenz.
Colossus was then built to find the Lorenz wheel settings used for each message, using a large electronic programmable logic calculator, driven by up to 2,500 thermionic valves. The computer was fast, even by today's standards. It could break the combination in about two hours - the same as today's modern Pentium PC.
Without the contribution of the codebreaking activity, in which Colossus played such a major part, the Second World War would have lasted considerably longer.
By the time of the Allied invasion of France in the early summer of 1944, a Colossus Mk II (using nearly twice as many valves to power it) was almost ready.
The head of the Post Office Research Team, Tommy Flowers, had been told that Colossus Mk II had to be ready by June 1944 or it would not be of any use. He was not told the reason for the deadline, but realising that it was significant he ensured that the new version was ready for June 1, five days before D-Day.
It was in the build-up to D-Day and during the European campaign that followed that Colossus proved most valuable, since it was able to track in detail communications between Hitler and his field commanders.
Colossus weighed around 35 tonnes in Mark II form. Its 2,500 valves, consuming 4.5 Kwatts, were spread over two banks of racks 7 feet 6 inches high by 16 feet wide spaced 6 feet apart. Thus the whole machine was around 80 feet long and 40 feet wide.
This huge machine was also one of the most closely guarded secrets of the war yet required dozens of people to build, many of them outside the military establishment in the Post Office.
Tommy Flowers was one of the very few entrusted with the overall plan - and even he didn't know the full details of the German codes.
In order to ensure security, Colossus was broken down into modules - each given to a separate Post Office team at Dollis Hill. The teams were kept apart - each having no idea of the overall shape of the ground breaking machines they were creating.
Another secret wartime computer whose existence was finally revealed many years later was SIGSALY - the secret 'scrambling' system devised to protect the security of high level Allied telephone traffic.
SIGSALY - originally codenamed Project X - was also known as 'Green Hornet'. It was the first unbreakable speech coding system, using digital cryptography techniques, with one time digital keys being supplied by synchronised gramophone discs.
SIGSALY was built in the USA, though using pulse code modulation (PCM) digital encoding techniques invented in 1937 by the English engineer Alec Reeves.
The first priority was to protect the hotline between the Cabinet War Room bunker under Downing Street and the White House in Washington D.C. The 50-ton London terminal was shipped over in 1943 and housed in the basement of the Selfridges annexe in Oxford Street, under tight guard.
By designing a huge machine now generally regarded as the world's first programmable electronic computer, the then Post Office Research Branch played a crucial but secret role in helping to win the Second World War. The purpose of Colossus was to decipher messages that came in on a German cipher machine, called the Lorenz SZ.
The original Colossus used a vast array of telephone exchange parts together with 1,500 electronic valves and was the size of a small room, weighing around a ton. This 'string and sealing wax affair' could process 5,000 characters a second to run through the many millions of possible settings for the code wheels on the Lorenz system in hours - rather than weeks.
Both machines were designed and constructed by a Post Office Research team headed by Tommy Flowers at Dollis Hill and transported to the secret code-breaking centre at Bletchley Park, near Milton Keynes, where it was demonstrated on December 8, 1943. We have to fast forward nearly thirty years to 1972 for the arrival of the first desktop all-in-one computer, which are more familar to us today. That honour falls to the HP9830. But unfortunately few people got to hear about it because Hewlett Packard marketed it primarily to scientists and engineers - by nature very quiet people!
Colossus (1941) : inside the machine
During the Second World War the Germans used a Lorenz encoding teleprinter to transmit their high-command radio messages. The teleprinter used something called the 5-bit Baudot code, which enciphered the original text by adding to it successively two characters before transmission. The same two characters were applied to the received text at the other end to reveal the original message.
Gilbert Vernam had developed this scheme in America, using two synchronised tapes to generate the additional random characters. Lorenz replaced the tapes with mechanical gearing - so it wasn't a genuinely random sequence - just extremely complex.
But in August 1941 the Germans made a bad mistake. A tired operator sent almost the same message again, using the same wheel settings. It meant the British were able to calculate the logical structure inside the Lorenz.
Colossus was then built to find the Lorenz wheel settings used for each message, using a large electronic programmable logic calculator, driven by up to 2,500 thermionic valves. The computer was fast, even by today's standards. It could break the combination in about two hours - the same as today's modern Pentium PC.
Without the contribution of the codebreaking activity, in which Colossus played such a major part, the Second World War would have lasted considerably longer.
By the time of the Allied invasion of France in the early summer of 1944, a Colossus Mk II (using nearly twice as many valves to power it) was almost ready.
The head of the Post Office Research Team, Tommy Flowers, had been told that Colossus Mk II had to be ready by June 1944 or it would not be of any use. He was not told the reason for the deadline, but realising that it was significant he ensured that the new version was ready for June 1, five days before D-Day.
It was in the build-up to D-Day and during the European campaign that followed that Colossus proved most valuable, since it was able to track in detail communications between Hitler and his field commanders.
Colossus weighed around 35 tonnes in Mark II form. Its 2,500 valves, consuming 4.5 Kwatts, were spread over two banks of racks 7 feet 6 inches high by 16 feet wide spaced 6 feet apart. Thus the whole machine was around 80 feet long and 40 feet wide.
This huge machine was also one of the most closely guarded secrets of the war yet required dozens of people to build, many of them outside the military establishment in the Post Office.
Tommy Flowers was one of the very few entrusted with the overall plan - and even he didn't know the full details of the German codes.
In order to ensure security, Colossus was broken down into modules - each given to a separate Post Office team at Dollis Hill. The teams were kept apart - each having no idea of the overall shape of the ground breaking machines they were creating.
Another secret wartime computer whose existence was finally revealed many years later was SIGSALY - the secret 'scrambling' system devised to protect the security of high level Allied telephone traffic.
SIGSALY - originally codenamed Project X - was also known as 'Green Hornet'. It was the first unbreakable speech coding system, using digital cryptography techniques, with one time digital keys being supplied by synchronised gramophone discs.
SIGSALY was built in the USA, though using pulse code modulation (PCM) digital encoding techniques invented in 1937 by the English engineer Alec Reeves.
The first priority was to protect the hotline between the Cabinet War Room bunker under Downing Street and the White House in Washington D.C. The 50-ton London terminal was shipped over in 1943 and housed in the basement of the Selfridges annexe in Oxford Street, under tight guard.
Monday, January 5, 2009
Top 10 Application Development Stories of 2008
Cloud development platforms, mobile application development and the increasing acceptance of dynamic languages for Web development were among the top 10 stories in the world of software programming. With each passing year, software tools have become more sophisticated. While developers have more languages and tools to choose from than ever before.
1. Cloud development platforms bloom
Google App Engine, Microsoft Windows Azure, Amazon, Salesforce.com and others have entered into the cloud space in force. What must developers do to program to the cloud?
2. Microsoft gets serious about software modeling
Microsoft releases its "Oslo" modeling strategy, joins the Object Modeling Group and pledges support for UML. Microsoft long held an indifferent if not hostile view of the Unified Modeling Language, but has now done an about face and is supporting modeling big time, and supporting UML in the Visual Studio 2010 toolset.
3. Mobile app development gets huge
Android, Windows Mobile, iPhone, BlackBerry, Symbian, name your platform. Mobile app development is where the action is. The next step is making it easier to build apps that run on more than one platform.
4. Dynamic languages take off
Ruby, PHP, JavaScript, Python, et al, see mainstream use. Ruby is used in all kinds of social networking and Web 2.0 environments, however, taking shots for not being as scalable as some other languages. Meanwhile, PHP, Python and others see their use on the rise in the enterprise.
5. ECMAScript (JavaScript) 4 is tabled
ECMA was on track to release the next major version of the ECMAScript specification, but several members of the core working group looking at the issue said let's slow down and make things less complicated. ECMAScript is the standards embodiment of JavaScript, which is the lifeblood of browsers. Tabling ECMAScript 4 means companies like Microsoft can have more time to implement new standards into their browsers.
6. Multicore processors put pressure on application developers
With the advent of multicore systems, developers are being forced to write applications that support them. It means developers essentially have to rethink their development strategies and gear up for parallel environments. Companies such as Microsoft, Intel, IBM, Sun and others are looking at the issue.
7. Microsoft/Adobe rivalry heat up
With new versions of Silverlight and WPF, and Adobe Flash, AIR and "Thermo," Microsoft continues to encroach on Adobe's turf in the rich Internet application (RIA) space with Silverlight 2 and Windows Presentation Foundation. And into the designer/developer workflow arena with Microsoft Expression. However, Adobe continues to innovate, delivering Flash Player 10, a new version of Adobe AIR and its new "Thermo" design tool. Meanwhile, Sun enters the fray with JavaFX.
8. Planting the seeds of 'development as a service'
The Basecamp guys, 37 Signals, do a great job, but there's also Heroku, Bungee Connect and a few others: They've all done special cases of development or team collaboration. If someone were to come in and combine them all, it could be a pretty good (and modern) competitor to Visual Studio and WebSphere. It certainly portends a direction the industry should be taking toward hosted rather than on-premises servers.
9. OSGi (Open Services Gateway initiative) makes a big splash
Eclipse, NetBeans, the Spring Framework, Apache and others are looking to OSGi as the future of their Java deployment environments. Others see OSGi not only for deployment but for its programming model, which is starting to encroach on Java EE APIs.
10. The Spring Framework wins converts
Spring has become a leading player in enterprise Java because it helps to simplify development as opposed to Enterprise JavaBeans (EJBs) and J2EE (Java 2 Platform, Enterprise Edition) or Java EE (Java Enterprise Edition).
1. Cloud development platforms bloom
Google App Engine, Microsoft Windows Azure, Amazon, Salesforce.com and others have entered into the cloud space in force. What must developers do to program to the cloud?
2. Microsoft gets serious about software modeling
Microsoft releases its "Oslo" modeling strategy, joins the Object Modeling Group and pledges support for UML. Microsoft long held an indifferent if not hostile view of the Unified Modeling Language, but has now done an about face and is supporting modeling big time, and supporting UML in the Visual Studio 2010 toolset.
3. Mobile app development gets huge
Android, Windows Mobile, iPhone, BlackBerry, Symbian, name your platform. Mobile app development is where the action is. The next step is making it easier to build apps that run on more than one platform.
4. Dynamic languages take off
Ruby, PHP, JavaScript, Python, et al, see mainstream use. Ruby is used in all kinds of social networking and Web 2.0 environments, however, taking shots for not being as scalable as some other languages. Meanwhile, PHP, Python and others see their use on the rise in the enterprise.
5. ECMAScript (JavaScript) 4 is tabled
ECMA was on track to release the next major version of the ECMAScript specification, but several members of the core working group looking at the issue said let's slow down and make things less complicated. ECMAScript is the standards embodiment of JavaScript, which is the lifeblood of browsers. Tabling ECMAScript 4 means companies like Microsoft can have more time to implement new standards into their browsers.
6. Multicore processors put pressure on application developers
With the advent of multicore systems, developers are being forced to write applications that support them. It means developers essentially have to rethink their development strategies and gear up for parallel environments. Companies such as Microsoft, Intel, IBM, Sun and others are looking at the issue.
7. Microsoft/Adobe rivalry heat up
With new versions of Silverlight and WPF, and Adobe Flash, AIR and "Thermo," Microsoft continues to encroach on Adobe's turf in the rich Internet application (RIA) space with Silverlight 2 and Windows Presentation Foundation. And into the designer/developer workflow arena with Microsoft Expression. However, Adobe continues to innovate, delivering Flash Player 10, a new version of Adobe AIR and its new "Thermo" design tool. Meanwhile, Sun enters the fray with JavaFX.
8. Planting the seeds of 'development as a service'
The Basecamp guys, 37 Signals, do a great job, but there's also Heroku, Bungee Connect and a few others: They've all done special cases of development or team collaboration. If someone were to come in and combine them all, it could be a pretty good (and modern) competitor to Visual Studio and WebSphere. It certainly portends a direction the industry should be taking toward hosted rather than on-premises servers.
9. OSGi (Open Services Gateway initiative) makes a big splash
Eclipse, NetBeans, the Spring Framework, Apache and others are looking to OSGi as the future of their Java deployment environments. Others see OSGi not only for deployment but for its programming model, which is starting to encroach on Java EE APIs.
10. The Spring Framework wins converts
Spring has become a leading player in enterprise Java because it helps to simplify development as opposed to Enterprise JavaBeans (EJBs) and J2EE (Java 2 Platform, Enterprise Edition) or Java EE (Java Enterprise Edition).
Security
Microsoft is again urging users to apply a patch for a vulnerability in the Windows Server service. The company reported earlier that a new variant of the Conficker worm has surfaced to target the flaw.
Microsoft advised organizations yet again to deploy the patch for a flaw affecting the Windows Server service that was fixed in October.
The latest attacks are coming courtesy of a new variant of the Conficker worm, identified by Microsoft as Win32/Conficker.B. According to the company, the variant is hitting machines that have not applied the fix, while also spreading via network shares by attempting to log in to machines using a list of weak passwords.
The worm exploits a vulnerability caused by the Server service failing to properly handle specifically crafted RPC (remote procedure call) requests. If an exploit is successful, it could allow an attacker to execute code remotely when file sharing is enabled.
The issue was the subject of a rare out-of-band security patch by Microsoft on Oct. 23. As attacks mounted, Microsoft issued a follow-up advisory on its Security Response Center blog a month later.
"We encourage all customers to apply our most recent security updates to help ensure that their computers are protected from attempted criminal attacks," a Microsoft spokesperson said.
The Windows firewall also provides a defense against attacks in a default setting because as it blocks hackers from reaching the RPC interface.
The flaw affects users of Microsoft Windows 2000, Windows XP and Windows Vista, as well as Windows Server 2003 and Server 2008. On Windows 2000, XP and Server 2003, any anonymous user with access to the target network can deliver a specially crafted network packet to exploit the vulnerability. However, on Vista and Server 2008 systems, only an authenticated user with access to the target network can deliver the packet.
"By default, Microsoft Windows XP, Windows Vista, Windows Server 2003 and Windows Server 2008 customers will have this update applied automatically through Automatic Updates," the spokesperson said. "We encourage all customers to apply our most recent security updates to help ensure that their computers are protected from attempted criminal attacks."
Microsoft advised organizations yet again to deploy the patch for a flaw affecting the Windows Server service that was fixed in October.
The latest attacks are coming courtesy of a new variant of the Conficker worm, identified by Microsoft as Win32/Conficker.B. According to the company, the variant is hitting machines that have not applied the fix, while also spreading via network shares by attempting to log in to machines using a list of weak passwords.
The worm exploits a vulnerability caused by the Server service failing to properly handle specifically crafted RPC (remote procedure call) requests. If an exploit is successful, it could allow an attacker to execute code remotely when file sharing is enabled.
The issue was the subject of a rare out-of-band security patch by Microsoft on Oct. 23. As attacks mounted, Microsoft issued a follow-up advisory on its Security Response Center blog a month later.
"We encourage all customers to apply our most recent security updates to help ensure that their computers are protected from attempted criminal attacks," a Microsoft spokesperson said.
The Windows firewall also provides a defense against attacks in a default setting because as it blocks hackers from reaching the RPC interface.
The flaw affects users of Microsoft Windows 2000, Windows XP and Windows Vista, as well as Windows Server 2003 and Server 2008. On Windows 2000, XP and Server 2003, any anonymous user with access to the target network can deliver a specially crafted network packet to exploit the vulnerability. However, on Vista and Server 2008 systems, only an authenticated user with access to the target network can deliver the packet.
"By default, Microsoft Windows XP, Windows Vista, Windows Server 2003 and Windows Server 2008 customers will have this update applied automatically through Automatic Updates," the spokesperson said. "We encourage all customers to apply our most recent security updates to help ensure that their computers are protected from attempted criminal attacks."
The Power Of Us
The 35 employees at Meiosys Inc., a software firm in Palo Alto, Calif., didn't know they were joining a gang of telecom-industry marauders. They just wanted to save a few bucks. Last year they began using Skype, a program that lets them make free calls over the Internet, with better sound quality than regular phones, using headsets connected to their PCs. Callers simply click on a name in their Skype contact lists, and if the person is there, they connect and talk just like on a regular phone call. "Better quality at no cost," exults Meiosys Chief Executive Jason Donahue. Poof! Almost 90% of his firm's $2,000 monthly long-distance phone bill has vanished. With 41 million people now using Skype, plus 150,000 more each day, it's no wonder AT&T (T ) and MCI Inc. (MCIP ) are hanging it u.
How can a tiny European upstart like Skype Technologies S.A. do a number on a trillion-dollar industry? By dialing up a vast, hidden resource: its own users. Skype, the newest creation from the same folks whose popular file-sharing software Kazaa freaked out record execs, also lets people share their resources -- legally. When users fire up Skype, they automatically allow their spare computing power and Net connections to be borrowed by the Skype network, which uses that collective resource to route others' calls. The result: a self-sustaining phone system that requires no central capital investment -- just the willingness of its users to share. Says Skype CEO Niklas Zennström: "It's almost like an organism."
A big, hairy, monstrous organism, that is. The nearly 1 billion people online worldwide -- along with their shared knowledge, social contacts, online reputations, computing power, and more -- are rapidly becoming a collective force of unprecedented power. For the first time in human history, mass cooperation across time and space is suddenly economical. "There's a fundamental shift in power happening," says Pierre M. Omidyar, founder and chairman of the online marketplace eBay Inc. (EBAY ) "Everywhere, people are getting together and, using the Internet, disrupting whatever activities they're involved in."
Collective Clamor
Behold the power of us. It's the force behind the collective clamor of Weblogs that felled CBS (VIA ) anchorman Dan Rather and rocked the media establishment. Global crowds of open-source Linux programmers are giving even mighty Microsoft Corp. (MSFT ) fits. Virtual supercomputers, stitched together from millions of volunteers' PCs, are helping predict global climate change, analyze genetic diseases, and find new planets and stars. One investment-management firm, Marketocracy Inc., even runs a sort of stock market rotisserie league for 70,000 virtual traders. It skims the cream of the best-performing portfolios to buy and sell real stocks for its $60 million mutual fund.
Although tech companies may be leading the way, their efforts are shaking up other industries, including entertainment, publishing, and advertising. Hollywood is under full-scale assault by 100 million people sharing songs and movies online via programs such as Kazaa and BitTorrent. The situation is the same with ad-supported media: Google Inc.'s (GOOG ) ace search engine essentially polls the collective judgments of millions of Web page creators to determine the most relevant search results. In the process, it has created a multibillion-dollar market for supertargeted ads that's drawing money from magazine display ads and newspaper classifieds.
Most telling, traditional companies, from Procter & Gamble Co. (PG ) to Dow Chemical Co., are beginning to flock to the virtual commons, too. The potential benefits are enormous. If companies can open themselves up to contributions from enthusiastic customers and partners, that should help them create products and services faster, with fewer duds -- and at far lower cost, with far less risk. LEGO Group uses the Net to identify and rally its most enthusiastic customers to help it design and market more effectively. Eli Lilly & Co. (LLY ), Hewlett-Packard Co. (HP ), and others are running "prediction markets" that extract collective wisdom from online crowds, which help gauge whether the government will approve a drug or how well a product will sell.
At the same time, peer power presents difficult challenges for anyone invested in the status quo. Corporations, those citadels of command-and-control, may be in for the biggest jolt. Increasingly, they will have to contend with ad hoc groups of customers who have the power to join forces online to get what they want. Indeed, customers are creating what they want themselves -- designing their own software with colleagues, for instance, and declaring their opinions via blogs instead of waiting for newspapers to print their letters. "It's the democratization of industry," says C.K. Prahalad, a University of Michigan Stephen M. Ross School of Business professor and co-author of the 2004 book The Future of Competition: Co-Creating Unique Value with Customers. "We are seeing the emergence of an economy of the people, by the people, for the people."
Peer Production
That suggests even more sweeping changes to come. Howard Rheingold, author of Smart Mobs: The Next Social Revolution, sees a common thread in such disparate innovations as the Internet, mobile devices, and the feedback system on eBay, where buyers and sellers rate each other on each transaction. He thinks they're the underpinnings of a new economic order. "These are like the stock companies and liability insurance that made capitalism possible," suggests Rheingold, who's also helping lead the Cooperation Project, a network of academics and businesses trying to map the new landscape. "They may make some new economic system possible."
Perhaps they already are. Yochai Benkler, a Yale Law School professor who studies the economics of networks, thinks such online cooperation is spurring a new mode of production beyond the two classic pillars of economics, the firm and the market. "Peer production," as he calls work such as open-source software, file-sharing, and Amazon.com Inc.'s (AMZN ) millions of customer product reviews, creates value with neither conventional corporate oversight nor market incentives such as payment. "The economic role of social behavior is increasing," he says. "Things that would normally just dissipate in the air as social gestures become economic products."
Indeed, peer production represents a sea change in the economy -- at least when it comes to the information products, services, and content that increasingly drive economic growth. More than two centuries ago, James Watt's steam engine ushered in the Industrial Revolution, centralizing the means of production in huge, powerful corporations that had the capital to achieve economies of scale. Now cheap computers and new social software and services -- along with the Internet's ubiquitous communications that make it easy to pool those capital investments -- are starting to give production power back to the people. Says Benkler: "This departs radically from everything we've seen since the Industrial Revolution."
Sound pretty threatening to anyone invested in the status quo? You bet. Indeed, as the title of Rheingold's book implies, there could be a dark side to this new cooperative force, especially if it results in mob rule. Quite often, the best solution to a problem comes from the sudden flash of insight from a solitary genius such as Charles Darwin or Albert Einstein. It would be a tragedy if these folks, sometimes unpopular in their times, got lost in the cooperative crowds. Clearly, peer production has its limits. Almost certainly, it will never build railroads, grow wheat, run nuclear power plants, or write great novels.
Yet this cooperative force may spread beyond such easily shared commodities as information, knowledge, and media. People are starting to use the Net to pool tangible goods as well. In a sense, Skype enables people to share computer hardware. Thanks to the Web's ability to serve as a meeting ground and scheduling coordinator, it's becoming economical to share cars, for example. Services such as Zipcar Inc. and Flexcar let members use the Net to reserve one of a fleet of autos in crowded cities, almost on demand, for an hourly fee.
What's driving all this togetherness? More than anything, an emerging generation of Net technologies. They include file-sharing, blogs, group-edited sites called wikis, and social networking services such as MySpace and Meetup Inc., which has helped everyone from Howard Deaniacs to English bulldog owners in New York form local groups. Those technologies are finally teasing out the Net's unique potential in a way that neither e-mail nor traditional Web sites did. The Net can, like no other medium, connect many people with many others at the same time.
What sets these new technologies apart from those of the Internet's first generation is their canny way of turning self-interest into social benefit -- and real economic value. They have what tech-book publisher Tim O'Reilly calls an "architecture of participation," so it's easy for people to do their own thing: create a link on their Web site to another Web site they like; rate a song; or just show off their knowledge with an online product review. Then, those actions can be pooled into something useful to many: the 3 billion song ratings that help people create personalized Net radio stations on Yahoo (YHOO )! Inc. or Amazon's millions of customer-generated product reviews, which help decide hits and duds. Exclaims Amazon CEO Jeffrey P. Bezos: "You invite the community in, and you get all this help."
It's surprisingly good help, too. New research indicates that cooperation, often organized from the bottom up, plays a much greater role than we thought in everything from natural phenomena like ant colonies to human institutions such as markets and cities. It's what New Yorker writer James Surowiecki, in his illuminating 2004 book of the same name, calls "the wisdom of crowds." Crowds can go mad, of course, but by and large, it turns out, they're smarter at solving many problems than even the brightest individuals.
The Internet's supreme group-forming capability suggests the rise of an almost spooky group intelligence. Within minutes of Pope John Paul II's death, hundreds of eBay sellers had posted related products for sale. Whether it is responding to world events or new products such as Sony Corp.'s (SNE ) PSP game machine, eBay's hive mind reacts to shifts in demand much faster than traditional companies with layers of management approval. Although eBay recently has seen some mature markets in the U.S. and Germany slow, the group smarts have helped keep growth more than respectable, with gross merchandise sales this year expected to rise 32%, to $45 billion. As eBay CEO Margaret C. Whitman has noted: "It is far better to have an army of a million than a command-and-control system."
More companies are starting to understand the logic. If they can get others to help them design and create products, they end up with ready-made customers -- and that means far less risk in the tricky business of creating new goods and markets. So businesses are accessing the cyberswarm to improve everything from research and development to marketing. Says Alpheus Bingham, vice-president for Eli Lilly's e.Lilly research unit: "If I can tap into a million minds simultaneously, I may run into one that's uniquely prepared."
Procter & Gamble's $1.7 billion-a-year R&D operation, for instance, is taking advantage of collective online brain trusts such as Lilly company InnoCentive Inc. in Andover, Mass. It's a network of 80,000 independent, self-selected "solvers" in 173 countries who gang-tackle research problems for the likes of Boeing Co. (BA ), DuPont (DD ), and 30 other large companies. One solver, Drew Buschhorn, is a 21-year-old chemistry grad student at the University of Indiana at Bloomington. He came up with an art-restoration chemical for an unnamed company -- a compound he identified while helping his mother dye cloth when he was a kid. Says InnoCentive CEO Darren J. Carroll: "We're trying for the democratization of science."
And apparently succeeding. More than a third of the two dozen requests P&G has submitted to InnoCentive's network have yielded solutions, for which the company paid upwards of $5,000 apiece. By using InnoCentive and other ways of reaching independent talent, P&G has boosted the number of new products derived from outside to 35%, from 20% three years ago. As a result, sales per R&D person are ahead some 40%.
The online masses aren't just offering up ideas: Sometimes they all but become the entire production staff. In game designer Linden Lab's Second Life, a virtual online world, participants themselves create just about everything, from characters to buildings to games that are played inside the world. The 45-person company, which grossed less than $5 million last year, makes money by charging players for virtual land on which they build their creations. Second Life's 25,000 players collectively spend 6,000 hours a day actively creating things. Even if you assume only 10% of their work is any good, that's still equal to a 100-person team at a traditional game company. "We've built a market-based, far more efficient system for creating digital content," says Linden CEO Philip Rosedale.
Likewise, groups online are starting to turn marketing from megaphone to conversation. LEGO Group, for instance, brought adult LEGO train-set enthusiasts to its New York office to check out new designs. "We pooh-poohed them all," says Steve Barile, an Intel Corp. (INTC ) engineer and LEGO fan in Portland, Ore., who attended. As a result, says Jake McKee, LEGO's global community-development manager, "we literally produced what they told us to produce." The new locomotive, the "Santa Fe Super Chief" set, was shown to 250 enthusiasts in 2002, and their word-of-mouse helped the first 10,000 units sell out in less than two weeks with no other marketing.
Corporate planners are even starting to use the wisdom of online crowds to predict the future, forecasting profits and sales more precisely. Prediction markets let people essentially buy shares in various forecasts, often with real money. Most famously, they've been employed in the University of Iowa's experimental Iowa Electronic Markets to determine, with remarkable accuracy, the most likely winner of the Presidential election. The ease of organizing groups on the Net has caused an explosion in their use, says Emile Servan-Schreiber, CEO of NewsFutures Inc., a consultant that has run 40,000 prediction markets for companies and publications.
Mob Mentality
Hewlett-Packard Co.'s (HPQ ) services division was having trouble a few years ago with forecasts in the first month of a quarter. So Bernardo A. Huberman, director of HP Labs' Information Dynamics Lab, set up a market with 15 finance people not normally involved in such planning. They bought and sold virtual stock that represented a range of forecasts at, above, and below the official company forecast. Their collective bets yielded a 50% improvement in operating-profit predictability over conventional forecasts by individual managers.
For all the benefits, Net-based cooperation holds plenty of peril for the unwary. Obviously, not all crowds are wise. Even The Wisdom of Crowds author Surowiecki wonders if the Net connects like-minded people so well that it can amplify groupthink. "The more we talk to each other, the dumber we can get," he notes. Groups that discourage independent thought potentially could put a damper on out-of-the-box ideas from brilliant individuals. They can also become herds that buy or dump stocks on momentum alone. For that matter, they can devolve into lynch mobs and terrorist groups.
As companies have learned, the online hordes can quickly turn against them. Last September bike-lock manufacturer Kryptonite tried to downplay a blogger video that showed how to open its bike locks with a BIC pen. But the video instantly spread across the Net, forcing the company to spend more than $10 million on lock replacements.
To contend with this rising people power, corporations will have to craft new roles for themselves and learn new ways to operate in order to stay relevant. They'll be unable to keep secrets for long amid the chorus of online voices, as Apple Computer Inc. (AAPL ) learned when fan sites spilled the beans on unreleased products. Managers and employees will have to learn how to take orders from customers more than from bosses. "Networks are becoming the locus for innovation," says Stanford University professor Walter W. Powell. "Firms are becoming much more porous and decentralized."
The challenges, though, go to show that we're not talking about merely a new capitalist tool -- at least not one that's dominated by big capitalists. Upstarts, both ad hoc groups and new companies, are seizing the initiative far more than are established businesses. They're transforming industry after industry faster than individual companies can cope with.
Nowhere has that phenomenon happened faster than in software. Collaborative open-source development is rapidly moving beyond basic utility software like Linux to mainstream applications as well. An especially eye-opening example is SugarCRM Inc., which provides an open-source version of customer-relationship management software now dominated by Siebel Systems (SEBL ) and salesforce.com Inc. (CRM ) The 10-person outfit's software, which CEO John Roberts calls "the collective work of bright CRM engineers around the world," has been downloaded more than 235,000 times for free.
The company makes money from services such as technical support and a $40-a-month Web-based service, as well as more fully featured corporate software for which it charges $239 per user per year. Scarcely a year old, SugarCRM won't reveal its finances, but its business model suggests a big change in how the software industry works. "The fact that everyone can participate [in open-source] is creating a new market ecology," says Kim Polese, CEO of SpikeSource Inc., a startup providing bundles of open-source products. Or, as Roberts adds brightly: "We're turning a $10 billion market space into a $1 billion market space."
The same scary prospect lies ahead for other information-based industries, such as entertainment, media, and publishing, that are rapidly going digital. People are not only sharing songs and movies -- legally or not -- but also creating content themselves and building sizable audiences. The threat comes from more than the 10 million-plus blogs. Overall, 53 million Americans have contributed material to the Net, from product reviews to eBay ratings, according to the Pew Internet & American Life Project.
The most breathtaking example: Wikipedia. Some 5 million people a month visit the free online encyclopedia, whose more than 1.5 million entries in 200 languages by volunteer experts around the globe outnumber Encyclopedia Britannica's 120,000, with surprisingly high quality. "Our work shows how quickly a traditional proprietary product can be overtaken by an open alternative," says co-founder Jimmy Wales. Unlike Britannica, Wales is not aiming to generate much, if any, revenue. But "that doesn't mean that we won't destroy their business," he notes. Britannica spokesman Tom Panelas says sheer volume of articles isn't a measure of quality and may be overload for most readers and researchers.
Then again, the cooperative crowds offer a lifeline to beleaguered media such as newspapers. The five-year-old online paper OhmyNews in South Korea has marshaled 36,000 "citizen journalists" to write up to 200 stories a day on everything from political protests to movies. Its popularity with 1 million daily visitors has made it the sixth-most influential media outlet in Korea, according to a national magazine poll -- topping one of the three television networks. "It's participatory journalism," explains founder Oh Yeon Ho, who says OhmyNews turned a profit last year. The idea is starting to catch fire in the U.S., too, via independent citizen-media efforts such as Backfence Inc. and Bayosphere and budding initiatives by E.W. Scripps Co. (SSP ) and others. The New York Times Co. is also testing the waters: In March, it bought About.com, which has 475 citizen experts on consumer electronics, personal finance, and other topics.
Even industries that traffic in physical goods are being turned upside down by Net-driven sharing. In retail, for instance, "consumers" are becoming active participants in the merchants they buy from, transforming the venerable suggestion box into something more influential. At Amazon.com, thousands of volunteers write buyer's guides and lists of favorite products. Amazon also lets thousands of merchants, from Target Stores (TGT ) to individuals, sell on Amazon pages.
What's more, Amazon is opening up the technology behind product databases, payment services, and more to 65,000 software developers. They're creating new services, such as the ability to compare brick-and-mortar store prices with Amazon's by scanning a bar code into a cell phone. Thanks in part to such moves, the company is solidly profitable on $6.9 billion in sales last year. "We're all building this thing together -- Amazon itself, outside developers, associates, and customers," says Jeff Barr, Amazon's Web services evangelist.
That raises a key point: All of us will have to take on more responsibility. And to get the most out of the new cooperative tools and services, we'll have to contribute our time and talent in new ways -- such as rating a seller on eBay or penning a short essay in Wikipedia. But the rewards will be more personalized products and services that we don't merely consume, but help create.
Ultimately, all this could point the way to a fundamental change in the way people work together. In 1968, ecologist Garrett Hardin popularized the notion of the tragedy of the commons. He noted that public resources, from pastures and national parks to air and water, inevitably get overused as people act in their own self-interest. It's a different story in the Information Age, contends Dan Bricklin, co-creator of the pioneering PC software VisiCalc and president of consultant Software Garden Inc. in Newton Highlands, Mass.
Instead, he says, there's a cornucopia of the commons. That rich reward may be worth all the disruption we've seen and all the more still to come.
How can a tiny European upstart like Skype Technologies S.A. do a number on a trillion-dollar industry? By dialing up a vast, hidden resource: its own users. Skype, the newest creation from the same folks whose popular file-sharing software Kazaa freaked out record execs, also lets people share their resources -- legally. When users fire up Skype, they automatically allow their spare computing power and Net connections to be borrowed by the Skype network, which uses that collective resource to route others' calls. The result: a self-sustaining phone system that requires no central capital investment -- just the willingness of its users to share. Says Skype CEO Niklas Zennström: "It's almost like an organism."
A big, hairy, monstrous organism, that is. The nearly 1 billion people online worldwide -- along with their shared knowledge, social contacts, online reputations, computing power, and more -- are rapidly becoming a collective force of unprecedented power. For the first time in human history, mass cooperation across time and space is suddenly economical. "There's a fundamental shift in power happening," says Pierre M. Omidyar, founder and chairman of the online marketplace eBay Inc. (EBAY ) "Everywhere, people are getting together and, using the Internet, disrupting whatever activities they're involved in."
Collective Clamor
Behold the power of us. It's the force behind the collective clamor of Weblogs that felled CBS (VIA ) anchorman Dan Rather and rocked the media establishment. Global crowds of open-source Linux programmers are giving even mighty Microsoft Corp. (MSFT ) fits. Virtual supercomputers, stitched together from millions of volunteers' PCs, are helping predict global climate change, analyze genetic diseases, and find new planets and stars. One investment-management firm, Marketocracy Inc., even runs a sort of stock market rotisserie league for 70,000 virtual traders. It skims the cream of the best-performing portfolios to buy and sell real stocks for its $60 million mutual fund.
Although tech companies may be leading the way, their efforts are shaking up other industries, including entertainment, publishing, and advertising. Hollywood is under full-scale assault by 100 million people sharing songs and movies online via programs such as Kazaa and BitTorrent. The situation is the same with ad-supported media: Google Inc.'s (GOOG ) ace search engine essentially polls the collective judgments of millions of Web page creators to determine the most relevant search results. In the process, it has created a multibillion-dollar market for supertargeted ads that's drawing money from magazine display ads and newspaper classifieds.
Most telling, traditional companies, from Procter & Gamble Co. (PG ) to Dow Chemical Co., are beginning to flock to the virtual commons, too. The potential benefits are enormous. If companies can open themselves up to contributions from enthusiastic customers and partners, that should help them create products and services faster, with fewer duds -- and at far lower cost, with far less risk. LEGO Group uses the Net to identify and rally its most enthusiastic customers to help it design and market more effectively. Eli Lilly & Co. (LLY ), Hewlett-Packard Co. (HP ), and others are running "prediction markets" that extract collective wisdom from online crowds, which help gauge whether the government will approve a drug or how well a product will sell.
At the same time, peer power presents difficult challenges for anyone invested in the status quo. Corporations, those citadels of command-and-control, may be in for the biggest jolt. Increasingly, they will have to contend with ad hoc groups of customers who have the power to join forces online to get what they want. Indeed, customers are creating what they want themselves -- designing their own software with colleagues, for instance, and declaring their opinions via blogs instead of waiting for newspapers to print their letters. "It's the democratization of industry," says C.K. Prahalad, a University of Michigan Stephen M. Ross School of Business professor and co-author of the 2004 book The Future of Competition: Co-Creating Unique Value with Customers. "We are seeing the emergence of an economy of the people, by the people, for the people."
Peer Production
That suggests even more sweeping changes to come. Howard Rheingold, author of Smart Mobs: The Next Social Revolution, sees a common thread in such disparate innovations as the Internet, mobile devices, and the feedback system on eBay, where buyers and sellers rate each other on each transaction. He thinks they're the underpinnings of a new economic order. "These are like the stock companies and liability insurance that made capitalism possible," suggests Rheingold, who's also helping lead the Cooperation Project, a network of academics and businesses trying to map the new landscape. "They may make some new economic system possible."
Perhaps they already are. Yochai Benkler, a Yale Law School professor who studies the economics of networks, thinks such online cooperation is spurring a new mode of production beyond the two classic pillars of economics, the firm and the market. "Peer production," as he calls work such as open-source software, file-sharing, and Amazon.com Inc.'s (AMZN ) millions of customer product reviews, creates value with neither conventional corporate oversight nor market incentives such as payment. "The economic role of social behavior is increasing," he says. "Things that would normally just dissipate in the air as social gestures become economic products."
Indeed, peer production represents a sea change in the economy -- at least when it comes to the information products, services, and content that increasingly drive economic growth. More than two centuries ago, James Watt's steam engine ushered in the Industrial Revolution, centralizing the means of production in huge, powerful corporations that had the capital to achieve economies of scale. Now cheap computers and new social software and services -- along with the Internet's ubiquitous communications that make it easy to pool those capital investments -- are starting to give production power back to the people. Says Benkler: "This departs radically from everything we've seen since the Industrial Revolution."
Sound pretty threatening to anyone invested in the status quo? You bet. Indeed, as the title of Rheingold's book implies, there could be a dark side to this new cooperative force, especially if it results in mob rule. Quite often, the best solution to a problem comes from the sudden flash of insight from a solitary genius such as Charles Darwin or Albert Einstein. It would be a tragedy if these folks, sometimes unpopular in their times, got lost in the cooperative crowds. Clearly, peer production has its limits. Almost certainly, it will never build railroads, grow wheat, run nuclear power plants, or write great novels.
Yet this cooperative force may spread beyond such easily shared commodities as information, knowledge, and media. People are starting to use the Net to pool tangible goods as well. In a sense, Skype enables people to share computer hardware. Thanks to the Web's ability to serve as a meeting ground and scheduling coordinator, it's becoming economical to share cars, for example. Services such as Zipcar Inc. and Flexcar let members use the Net to reserve one of a fleet of autos in crowded cities, almost on demand, for an hourly fee.
What's driving all this togetherness? More than anything, an emerging generation of Net technologies. They include file-sharing, blogs, group-edited sites called wikis, and social networking services such as MySpace and Meetup Inc., which has helped everyone from Howard Deaniacs to English bulldog owners in New York form local groups. Those technologies are finally teasing out the Net's unique potential in a way that neither e-mail nor traditional Web sites did. The Net can, like no other medium, connect many people with many others at the same time.
What sets these new technologies apart from those of the Internet's first generation is their canny way of turning self-interest into social benefit -- and real economic value. They have what tech-book publisher Tim O'Reilly calls an "architecture of participation," so it's easy for people to do their own thing: create a link on their Web site to another Web site they like; rate a song; or just show off their knowledge with an online product review. Then, those actions can be pooled into something useful to many: the 3 billion song ratings that help people create personalized Net radio stations on Yahoo (YHOO )! Inc. or Amazon's millions of customer-generated product reviews, which help decide hits and duds. Exclaims Amazon CEO Jeffrey P. Bezos: "You invite the community in, and you get all this help."
It's surprisingly good help, too. New research indicates that cooperation, often organized from the bottom up, plays a much greater role than we thought in everything from natural phenomena like ant colonies to human institutions such as markets and cities. It's what New Yorker writer James Surowiecki, in his illuminating 2004 book of the same name, calls "the wisdom of crowds." Crowds can go mad, of course, but by and large, it turns out, they're smarter at solving many problems than even the brightest individuals.
The Internet's supreme group-forming capability suggests the rise of an almost spooky group intelligence. Within minutes of Pope John Paul II's death, hundreds of eBay sellers had posted related products for sale. Whether it is responding to world events or new products such as Sony Corp.'s (SNE ) PSP game machine, eBay's hive mind reacts to shifts in demand much faster than traditional companies with layers of management approval. Although eBay recently has seen some mature markets in the U.S. and Germany slow, the group smarts have helped keep growth more than respectable, with gross merchandise sales this year expected to rise 32%, to $45 billion. As eBay CEO Margaret C. Whitman has noted: "It is far better to have an army of a million than a command-and-control system."
More companies are starting to understand the logic. If they can get others to help them design and create products, they end up with ready-made customers -- and that means far less risk in the tricky business of creating new goods and markets. So businesses are accessing the cyberswarm to improve everything from research and development to marketing. Says Alpheus Bingham, vice-president for Eli Lilly's e.Lilly research unit: "If I can tap into a million minds simultaneously, I may run into one that's uniquely prepared."
Procter & Gamble's $1.7 billion-a-year R&D operation, for instance, is taking advantage of collective online brain trusts such as Lilly company InnoCentive Inc. in Andover, Mass. It's a network of 80,000 independent, self-selected "solvers" in 173 countries who gang-tackle research problems for the likes of Boeing Co. (BA ), DuPont (DD ), and 30 other large companies. One solver, Drew Buschhorn, is a 21-year-old chemistry grad student at the University of Indiana at Bloomington. He came up with an art-restoration chemical for an unnamed company -- a compound he identified while helping his mother dye cloth when he was a kid. Says InnoCentive CEO Darren J. Carroll: "We're trying for the democratization of science."
And apparently succeeding. More than a third of the two dozen requests P&G has submitted to InnoCentive's network have yielded solutions, for which the company paid upwards of $5,000 apiece. By using InnoCentive and other ways of reaching independent talent, P&G has boosted the number of new products derived from outside to 35%, from 20% three years ago. As a result, sales per R&D person are ahead some 40%.
The online masses aren't just offering up ideas: Sometimes they all but become the entire production staff. In game designer Linden Lab's Second Life, a virtual online world, participants themselves create just about everything, from characters to buildings to games that are played inside the world. The 45-person company, which grossed less than $5 million last year, makes money by charging players for virtual land on which they build their creations. Second Life's 25,000 players collectively spend 6,000 hours a day actively creating things. Even if you assume only 10% of their work is any good, that's still equal to a 100-person team at a traditional game company. "We've built a market-based, far more efficient system for creating digital content," says Linden CEO Philip Rosedale.
Likewise, groups online are starting to turn marketing from megaphone to conversation. LEGO Group, for instance, brought adult LEGO train-set enthusiasts to its New York office to check out new designs. "We pooh-poohed them all," says Steve Barile, an Intel Corp. (INTC ) engineer and LEGO fan in Portland, Ore., who attended. As a result, says Jake McKee, LEGO's global community-development manager, "we literally produced what they told us to produce." The new locomotive, the "Santa Fe Super Chief" set, was shown to 250 enthusiasts in 2002, and their word-of-mouse helped the first 10,000 units sell out in less than two weeks with no other marketing.
Corporate planners are even starting to use the wisdom of online crowds to predict the future, forecasting profits and sales more precisely. Prediction markets let people essentially buy shares in various forecasts, often with real money. Most famously, they've been employed in the University of Iowa's experimental Iowa Electronic Markets to determine, with remarkable accuracy, the most likely winner of the Presidential election. The ease of organizing groups on the Net has caused an explosion in their use, says Emile Servan-Schreiber, CEO of NewsFutures Inc., a consultant that has run 40,000 prediction markets for companies and publications.
Mob Mentality
Hewlett-Packard Co.'s (HPQ ) services division was having trouble a few years ago with forecasts in the first month of a quarter. So Bernardo A. Huberman, director of HP Labs' Information Dynamics Lab, set up a market with 15 finance people not normally involved in such planning. They bought and sold virtual stock that represented a range of forecasts at, above, and below the official company forecast. Their collective bets yielded a 50% improvement in operating-profit predictability over conventional forecasts by individual managers.
For all the benefits, Net-based cooperation holds plenty of peril for the unwary. Obviously, not all crowds are wise. Even The Wisdom of Crowds author Surowiecki wonders if the Net connects like-minded people so well that it can amplify groupthink. "The more we talk to each other, the dumber we can get," he notes. Groups that discourage independent thought potentially could put a damper on out-of-the-box ideas from brilliant individuals. They can also become herds that buy or dump stocks on momentum alone. For that matter, they can devolve into lynch mobs and terrorist groups.
As companies have learned, the online hordes can quickly turn against them. Last September bike-lock manufacturer Kryptonite tried to downplay a blogger video that showed how to open its bike locks with a BIC pen. But the video instantly spread across the Net, forcing the company to spend more than $10 million on lock replacements.
To contend with this rising people power, corporations will have to craft new roles for themselves and learn new ways to operate in order to stay relevant. They'll be unable to keep secrets for long amid the chorus of online voices, as Apple Computer Inc. (AAPL ) learned when fan sites spilled the beans on unreleased products. Managers and employees will have to learn how to take orders from customers more than from bosses. "Networks are becoming the locus for innovation," says Stanford University professor Walter W. Powell. "Firms are becoming much more porous and decentralized."
The challenges, though, go to show that we're not talking about merely a new capitalist tool -- at least not one that's dominated by big capitalists. Upstarts, both ad hoc groups and new companies, are seizing the initiative far more than are established businesses. They're transforming industry after industry faster than individual companies can cope with.
Nowhere has that phenomenon happened faster than in software. Collaborative open-source development is rapidly moving beyond basic utility software like Linux to mainstream applications as well. An especially eye-opening example is SugarCRM Inc., which provides an open-source version of customer-relationship management software now dominated by Siebel Systems (SEBL ) and salesforce.com Inc. (CRM ) The 10-person outfit's software, which CEO John Roberts calls "the collective work of bright CRM engineers around the world," has been downloaded more than 235,000 times for free.
The company makes money from services such as technical support and a $40-a-month Web-based service, as well as more fully featured corporate software for which it charges $239 per user per year. Scarcely a year old, SugarCRM won't reveal its finances, but its business model suggests a big change in how the software industry works. "The fact that everyone can participate [in open-source] is creating a new market ecology," says Kim Polese, CEO of SpikeSource Inc., a startup providing bundles of open-source products. Or, as Roberts adds brightly: "We're turning a $10 billion market space into a $1 billion market space."
The same scary prospect lies ahead for other information-based industries, such as entertainment, media, and publishing, that are rapidly going digital. People are not only sharing songs and movies -- legally or not -- but also creating content themselves and building sizable audiences. The threat comes from more than the 10 million-plus blogs. Overall, 53 million Americans have contributed material to the Net, from product reviews to eBay ratings, according to the Pew Internet & American Life Project.
The most breathtaking example: Wikipedia. Some 5 million people a month visit the free online encyclopedia, whose more than 1.5 million entries in 200 languages by volunteer experts around the globe outnumber Encyclopedia Britannica's 120,000, with surprisingly high quality. "Our work shows how quickly a traditional proprietary product can be overtaken by an open alternative," says co-founder Jimmy Wales. Unlike Britannica, Wales is not aiming to generate much, if any, revenue. But "that doesn't mean that we won't destroy their business," he notes. Britannica spokesman Tom Panelas says sheer volume of articles isn't a measure of quality and may be overload for most readers and researchers.
Then again, the cooperative crowds offer a lifeline to beleaguered media such as newspapers. The five-year-old online paper OhmyNews in South Korea has marshaled 36,000 "citizen journalists" to write up to 200 stories a day on everything from political protests to movies. Its popularity with 1 million daily visitors has made it the sixth-most influential media outlet in Korea, according to a national magazine poll -- topping one of the three television networks. "It's participatory journalism," explains founder Oh Yeon Ho, who says OhmyNews turned a profit last year. The idea is starting to catch fire in the U.S., too, via independent citizen-media efforts such as Backfence Inc. and Bayosphere and budding initiatives by E.W. Scripps Co. (SSP ) and others. The New York Times Co. is also testing the waters: In March, it bought About.com, which has 475 citizen experts on consumer electronics, personal finance, and other topics.
Even industries that traffic in physical goods are being turned upside down by Net-driven sharing. In retail, for instance, "consumers" are becoming active participants in the merchants they buy from, transforming the venerable suggestion box into something more influential. At Amazon.com, thousands of volunteers write buyer's guides and lists of favorite products. Amazon also lets thousands of merchants, from Target Stores (TGT ) to individuals, sell on Amazon pages.
What's more, Amazon is opening up the technology behind product databases, payment services, and more to 65,000 software developers. They're creating new services, such as the ability to compare brick-and-mortar store prices with Amazon's by scanning a bar code into a cell phone. Thanks in part to such moves, the company is solidly profitable on $6.9 billion in sales last year. "We're all building this thing together -- Amazon itself, outside developers, associates, and customers," says Jeff Barr, Amazon's Web services evangelist.
That raises a key point: All of us will have to take on more responsibility. And to get the most out of the new cooperative tools and services, we'll have to contribute our time and talent in new ways -- such as rating a seller on eBay or penning a short essay in Wikipedia. But the rewards will be more personalized products and services that we don't merely consume, but help create.
Ultimately, all this could point the way to a fundamental change in the way people work together. In 1968, ecologist Garrett Hardin popularized the notion of the tragedy of the commons. He noted that public resources, from pastures and national parks to air and water, inevitably get overused as people act in their own self-interest. It's a different story in the Information Age, contends Dan Bricklin, co-creator of the pioneering PC software VisiCalc and president of consultant Software Garden Inc. in Newton Highlands, Mass.
Instead, he says, there's a cornucopia of the commons. That rich reward may be worth all the disruption we've seen and all the more still to come.
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