the art and observations of Ranjit S. Mathoda

In my prior post (http://www.mathoda.com/archives/160), I stated that the most impressive web company today is Facebook. They have created a clean, elegant interface, populated it with an ecosystem of other companies, and have an incredible core value proposition they call the social graph, which lets you easily see what your friends and acquaintances are up to in their lives.

Rupert Murdoch is a very savvy businessman, and he’s often credited for moving fast to snap up MySpace at what seemed like a foolhardy price, until it wasn’t. However, one reason he is a good businessman is because he doesn’t fool himself when it comes to business matters.

In an interview with the Wall Street Journal (a company he’s trying to buy) (http://online.wsj.com/public/article/SB118115049815626635.html), here’s what he said about Facebook:

WSJ: The Tribune company was shopped around for quite a while.

Mr. Murdoch: Yeah, but there weren’t any buyers.

WSJ: There was one in the end.

Mr. Murdoch: For $90 million. Risk. That’s in the figures …

WSJ: Why didn’t you do it?

Mr. Murdoch: Don’t want to spend the rest of my life going through that, getting rid of people, ugly. I think they’re in decline, they can fire a few hundred people everywhere, save a couple of hundred million dollars … I guess they will have a billion a year to pay down the debt, that’s what it sounds like. No, a bit less. I would have thought that, although the decline in readership will probably go on.

WSJ: They’re all going to MySpace.

Mr. Murdoch: I wish they were. They’re all going to Facebook at the moment.

And here’s what he said about Google and Microsoft:

WSJ: Then what’s the opportunity for you? Digital?

Mr. Murdoch: I think it’s in the digital area, digital and TV. And I think we’ve got to pour some money into digital. We’ve got to do a lot of things there… There’s so much going on on the Internet. We’ve got to find new ways and new business models to get revenues. Or else the world is going to be owned by Google. I was asked at this investment thing I had to go to, what competitors I see I would have in five years time. Globally. I said I’m sure they’ll be a lot of them. I know one is Google. It’s just getting so strong, so powerful. And I know the guys, and like them. They’re friends of mine. But it is a big fact of life. They sort of just hit the mother lode of search advertising and they’re just destroying Microsoft search, hurting Yahoo’s and making others irrelevant. I don’t understand the technologies but whatever their technology is, it seems to be producing a much higher margin of profit. What are they going to do next? I saw in the New York Times today they’re devising certain, a lot of computer applications which would directly challenge Microsoft, which they’ll give away. So it’s going to be very interesting. Four or five years ago we were all convinced Microsoft was going to take over the world. Now we’re all convinced it’s Google. But that’s another subject.

We live in interesting times, where mega-billion dollar market cap companies arise in very short time frames and fall from relevance even before their cash flow drops. I wonder how long it will take people to catch on to how fleeting competitive advantage can be on the Internet, even for what seem today to be the titans. It’s something to think about the next time someone bemoans corporate power or monopoly status of a company in the software industry.

Update, June 25, 2007: My friend Danah (danah.org) points out that MySpace and Facebook have different levels of popularity in different social classes: http://www.danah.org/papers/essays/ClassDivisions.html

I am consistently more impressed by the innovations emerging from one web company in particular than any other, and no, it’s not Google or Microsoft or Myspace or Wikipedia.

There is another company that seems to innovate much faster, and focus more strongly on being very useful in many interesting ways to many people, that has very rich information on its users, and is growing by leaps and bounds. For a youthful demographic, it is perhaps the most important site they stay on.

I’m talking, of course, about Facebook. With a clean elegant interface, and a degree of usefulness that infuses the whole site, it’s not really a social network site. It’s a social utility.

Signs of its power are growing. Among the younger generations, Myspace’s unruly ugliness has been eclipsed by Facebook’s elegant interface. (Rupert Murdoch, are you listening?)

And the true power of Facebook hasn’t hit the entertainment and business worlds yet, despite the fact it would be very useful to those worlds.

And Facebook isn’t stopping. It continues to evolve into something more powerful. They are now announcing that they are opening their website to outside application developers. For Facebook this may mean they are creating an even richer ecosystem of data and usefulness.

For the users of Facebook, this should let you see when and what applications friends are adopting, which could be very interesting in encouraging you to adopt new features on the site.

For developers, the applications can not only take advantage of the size and this new form of viral growth in the Facebook community, but they will also potentially be able to take advantage of the rich information Facebook has about its customers and their relationships to each other. If before it was difficult to compete with eBay’s stranglehold on buyers and sellers, the Facebook ecosystem may make it easier for an eBay competitor to emerge.

If Google is trying to create one super computer that solves all of your information needs, Facebook is creating one ecosystem that can do the same thing.

If Facebook ever ponders creating a search solution, Google look out.

For more, on Facebook’s past, present and future, see the Fortune magazine article here:
http://money.cnn.com/2007/05/24/technology/facebook.fortune/index.htm?postversion=2007052417

Or find out more about Facebook’s application initiative here:
http://www.techcrunch.com/2007/05/24/facebook-launches-facebook-platform-they-are-the-anti-myspace/

Update, 5/31/07: An excellent analysis of Facebook’s core power can be found here: http://feeds.feedburner.com/~r/Techcrunch/~3/121140079/

Update, 7/7/07: Rupert Murdoch, the power behind Myspace, recognizes Facebook’s ascendancy, as I point out here: http://www.mathoda.com/archives/165

Next, by Michael Crichton.

This book is about the very strange biotechnology future that is approaching much faster than most people suspect. It is also about how this future may be governed by our current laws, which make little sense. For example, because the law doesn’t recognize your right to own your body parts, major medical institutions have more rights and incentives in your body parts than you do. I couldn’t agree with Mr. Crichton more on either his observations about the technology or the law. Unfortunately, I’m not sure a novel was the proper format for this book, as the story and characters seemed to have been forgotten in favor of the ideas being communicated.

The Way to Win: Taking the White House in 2008, by Mark Halperin and John F. Harris.

This book’s subtitle notwithstanding, it is actually an examination of how campaign masterminds like Bill Clinton and Karl Rove operate. To its credit the book does delve deeply into explaining the operational techniques and why some seemingly foolhardy policy positions are actually effective at moving a candidate closer to victory. It shows how better insights and superior execution of a campaign can catapult little known candidates over their rivals, to the heights of power.

It also shows in some detail what I’ve long suspected: that although their followers are often motivated by their hate for the leaders of the opposing political party, the leaders of successful campaigns often admire each other and copy liberally from each other whatever works.

The book fails to adequately address the most interesting question about the 2008 campaign: how the Internet effects fund raising, getting the message out, and turning out the vote on election day. The subject matter of the subtitle wasn’t quite addressed.

Rembrandt: the Painter at Work by Ernst van Wetering
Velazquez: the Technique of Genius by Jonathan Brown and Carmen Garrido

How exactly did Rembrandt and Velazquez create their paintings? What choices did they make in how to make their brush strokes, how to mix their paints, how to layer their paints, how to compose their creations?

Sadly, if these books touched on such matters, they did so in a rather oblique way only. What was very helpful in these books was their inclusion of pictures of both entire paintings and of closeups of portions of such paintings. From the pictures I learned alot.

An interesting project has begun to catalog every known species, Wikipedia style. That is, each species gets its own web page, with photos, video and sound recordings, and locator maps when possible, and is subject to the same public editing process practices on Wikipedia.

http://www.washingtonpost.com/wp-dyn/content/article/2007/05/08/AR2007050801803.html?nav=rss_education

I wonder if someone will eventually add the DNA sequence of each species…

Update, 5/9/07: A video showing what the encyclopedia of life will look like can be found here: http://www.eol.org/home.html