The Daily Parker

Politics, Weather, Photography, and the Dog

Two IPOs, one story

At dinner last night with some of my B-school friends, conversation turned to the two most perplexing stock offerings of the last year: Facebook's and Groupon's. In both cases, the companies' very young owners and very rich venture capital investors got rich, but what happened after that? Here's Facebook's performance this week:

And Groupon's:

This morning, Groupon announced a proposed settlement in the class-action suit accusing them of practicing their well-known business model:

If you purchased or received a Groupon Voucher issued for redemption in the United States between November 1, 2008 and December 1, 2011, then you are a member of the class (“Class Member”) for purposes of this class action settlement, and may be entitled to receive settlement benefits, unless you are one of the following: (1) an employee of Groupon, Inc.; (2) a business with whom Groupon has partnered to offer Groupon vouchers (“Merchant Partners”); or (3) a parent company, subsidiary, affiliate or director or officer of Groupon or a Merchant Partner.

Facebook has its own problems. It's been a public company for less than three days, and already the SEC is investigating. Where they go, lawsuits surely will follow:

[R]egulators are concerned that banks may have shared information only with certain clients, rather than broadly with investors. On Tuesday, William Galvin, the secretary of state in Massachusetts, subpoenaed Morgan Stanley over discussions with investors about Facebook’s offering. The Financial Industry Regulatory Authority, Wall Street’s self-regulator, is also looking into the matter. The chairwoman of the Securities and Exchange Commission, Mary L. Schapiro, said Tuesday that the agency would examine issues related to Facebook’s I.P.O., but she did not elaborate.

Morgan Stanely, the banker in question, led both the Groupon and Facebook IPOs.

At least they didn't lose $2 billion last week gambling with money insured by us taxpayers.

Mama don't let your boys become coders

I agree with Jeff Atwood that learning to code isn't really a good goal:

The "everyone should learn to code" movement isn't just wrong because it falsely equates coding with essential life skills like reading, writing, and math. I wish. It is wrong in so many other ways.

  • It assumes that more code in the world is an inherently desirable thing. In my thirty year career as a programmer, I have found this … not to be the case. Should you learn to write code? No, I can't get behind that. You should be learning to write as little code as possible. Ideally none.
  • It assumes that coding is the goal. Software developers tend to be software addicts who think their job is to write code. But it's not. Their job is to solve problems. Don't celebrate the creation of code, celebrate the creation of solutions. We have way too many coders addicted to doing just one more line of code already.

He concludes:

Please don't advocate learning to code just for the sake of learning how to code. Or worse, because of the fat paychecks. Instead, I humbly suggest that we spend our time learning how to …

  • Research voraciously, and understand how the things around us work at a basic level.
  • Communicate effectively with other human beings.

These are skills that extend far beyond mere coding and will help you in every aspect of your life.

We can't hear this enough. It's why I tend to hire liberal arts majors who can code rather than computer science majors who can read.

Trolls where least expected

A mailing list I participate in has attracted a troll, which is a person who, deliberately or not, annoys everyone around him with ill-tempered, rude, and stupid questions. Our list's troll has managed to get himself suspended from Wikipedia about 10 times (he's still suspended), mostly for "incivil tone" and for missing the purpose of Wikipedia.

This kind of user has haunted every online community since The WELL and CompuServe—yea, even unto the days of the of dial-up BBS. This guy is simply the first troll we've seen on this particular list, though.

Brainstorming and data

The term "brainstorming," conjured up by BBDO partner Alex Osborn in the 1940s, conjures up images of creative people in a creative meeting creatively coming up with great ideas. Only, it doesn't actually work that well:

The first empirical test of Osborn’s brainstorming technique was performed at Yale University, in 1958. Forty-eight male undergraduates were divided into twelve groups and given a series of creative puzzles. The groups were instructed to follow Osborn’s guidelines. As a control sample, the scientists gave the same puzzles to forty-eight students working by themselves. The results were a sobering refutation of Osborn. The solo students came up with roughly twice as many solutions as the brainstorming groups, and a panel of judges deemed their solutions more “feasible” and “effective.

And yet Osborn was right about one thing: like it or not, human creativity has increasingly become a group process. “Many of us can work much better creatively when teamed up,” he wrote, noting that the trend was particularly apparent in science labs. “In the new B. F. Goodrich Research Center”—Goodrich was an important B.B.D.O. client—“250 workers . . . are hard on the hunt for ideas every hour, every day,” he noted. “They are divided into 12 specialized groups—one for each major phase of chemistry, one for each major phase of physics, and so on.” Osborn was quick to see that science had ceased to be solitary.

Lehrer continues to examine the success of Broadway musicals and the story of MIT's Building 20, "one of the most creative spaces in the world" from the 1940s until its demolition in 1998.

How Hollywood blew SOPA

The Hollywood Reporter has a lengthy (for them) description of how big-studio executives' SOPA effort looks, in retrospect, more like Pickett's Charge:

"They didn't understand the politics of the Internet, the power of the Internet, the perception people had of the things they were proposing," says an aide to a congressman who opposed the legislation. "The MPAA and the different lobbying organizations are trying to do it old-school and by the book. They ran into new technologies, new strategies, new techniques. I imagine they're sitting around discussing how they got beat."

The MPAA's [Michael] O'Leary concedes that the industry was outmanned and outgunned in cyberspace. He says the MPAA "is [undergoing] a process of education, a process of getting a much, much greater presence in the online environment. This was a fight on a platform we're not at this point comfortable with, and we were going up against an opponent that controls that platform."

More concisely: they just don't get it. And they probably never will, even after they become irrelevant (see under: record companies).

Quick updates

A couple of things have happened on two issues I mentioned earlier this week:

That is all for now. We in Chicago are bracing for 15 cm of snow tomorrow, so there may be Parker videos soon.

Oh, and: Kodak actually did file for bankruptcy protection today.

Public domain isn't necessarily permanent: SCOTUS

Via reader HF, the Supreme Court today decided Golan v Holder (pdf), in which the court held 6-2 that Congress was within its authority to restore copyright protection to some foreign works that had formerly lapsed into the public domain in the U.S.

Writing for the majority, Justice Ginsburg said: "Neither the Copyright and Patent Clause nor the First Amendment, we hold, makes the public domain, in any and all cases, a territory that works may never exit."

I'm still digesting the opinion, but let me say on first reading that it does not give Congress blanket authorization to restore copyright to works in the public domain, despite Wired's alarmist article. The circumstances of this case seem clear, well-defined, and narrow. Only works that never left copyright protection in the country where the work or the author came from, but lapsed into public domain in the U.S., are covered. Also, the decision only applies prospectively, so that authors whose works were copied or performed here during the lapse period will not require retroactive royalty payments. And the works will, in due course, return to the public domain, in most cases 70 years after the author's death.

To give an example: the works of Sergei Prokofiev, which generally went into the public domain in the U.S. 28 years after he wrote them, will return to copyright protection until 70 years after his death; i.e., at the end of 2023. But none of the recordings of his music made before today are affected. (Clarification: copies that exist as of this morning are not affected; any copies made from today forward are.)

Also, with the merciful strangling of SOPA this afternoon, the Copyright Police aren't going to block the iTunes store on suspicion of harboring "Peter and the Wolf." (Youporn, on the other hand, probably shouldn't have that one to begin with.)

Congress enacted the law in question to ensure that U.S. copyright holders get the same protection from other WTO members that other countries' authors get from us. Of course, who many of those copyright holders are, and the way they cling pathetically to an obsolete business model the way rats cling to flotsam in the ocean, is a different matter entirely. I recommend Lawrence Lessig's thoughts on SOPA to get you riled up about that problem.

Kodak on its deathbed

The Economist this week examines the imminent death of Kodak, which in the 1970s commanded 90% of the film market:

Then came digital photography to replace film, and smartphones to replace cameras. Kodak’s revenues peaked at nearly $16 billion in 1996 and its profits at $2.5 billion in 1999. The consensus forecast by analysts is that its revenues in 2011 were $6.2 billion. It recently reported a third-quarter loss of $222m, the ninth quarterly loss in three years. In 1988, Kodak employed over 145,000 workers worldwide; at the last count, barely one-tenth as many. Its share price has fallen by nearly 90% in the past year (see chart).

Despite its strengths—hefty investment in research, a rigorous approach to manufacturing and good relations with its local community—Kodak had become a complacent monopolist. Fujifilm exposed this weakness by bagging the sponsorship of the 1984 Olympics in Los Angeles while Kodak dithered. The publicity helped Fujifilm’s far cheaper film invade Kodak’s home market.

Another reason why Kodak was slow to change was that its executives “suffered from a mentality of perfect products, rather than the high-tech mindset of make it, launch it, fix it,” says Rosabeth Moss Kanter of Harvard Business School, who has advised the firm. Working in a one-company town did not help, either. Kodak’s bosses in Rochester seldom heard much criticism of the firm, she says. Even when Kodak decided to diversify, it took years to make its first acquisition.

Management matters. And all things end. It's still sad.

Vox populi

Welcome back. We were dark today to protest two flawed legislative proposals, the Stop Online Piracy Act and the Protect IP Act.

The administration today hinted at a threat to veto SOPA, while several senators have withdrawn support for PIPA in response to the blackout protests around the Internet:

Co-sponsors who say they can no longer support their own legislation include Senators Marco Rubio, a Florida Republican, Roy Blunt, a Missouri Republican, and Ben Cardin, a Maryland Democrat. Republican Representatives Ben Quayle of Arizona, Lee Terry of Nebraska, and Dennis Ross of Florida also said they would withdraw their backing of the House bill.

Rubio said he switched his position on the Senate measure, the Protect IP Act, after examining opponents’ contention that it would present a “potentially unreasonable expansion of the federal government’s power to impact the Internet,” according to a posting today on Facebook. Blunt said in a statement today he is withdrawing as a co-sponsor of the Senate bill.

The Washington Monthly explains the administration's volte face on SOPA:

The White House didn’t issue a veto threat, per se, but the administration’s chief technology officials concluded, “We will not support legislation that reduces freedom of expression, increases cybersecurity risk or undermines the dynamic, innovative global Internet.” The statement added that any proposed legislation “must not tamper with the technical architecture of the Internet.” The White House’s position left SOPA and PIPA, at least in their current form, effectively dead.

The state of play in the Senate is a little different — a PIPA vote is likely next Tuesday — but even in the upper chamber, the bill is quickly losing friends. Sen. Scott Brown (R-Mass.) announced his opposition yesterday, and Sen. Ben Cardin (D-Md.), a former co-sponsor of PIPA, is also now against it.

The President did, however, shut down the Keystone XL pipeline (at least for now).

So, in all, this was a pretty good day for the people.

Update: Via Coding Horror, Mozilla Foundation Chair Mitchell Baker has a great description of why PIPA and SOPA are so awful.