Jim Cramer has a popular financial show on CNBC, Mad Money. Recently he re-invigorated his CEO Wall of Shame identifying those CEO's who have succeed in destroying their companies. As part of this process Jim has been soliciting the audience to suggest nominees to who have earned a "coveted" spot on this wall of shame. In today's business environment that shouldn't be hard.
Last night it was the turn of Lewis Campbell, the CEO of Textron to get roasted and placed on the Wall of Shame. Textron, in many respects is very similar to General Electric. Like Textron General Electric has virtually collapsed. Forbes reports, in an aptly titled article: "Dim Bulb", that under Immelt guidance that GE's "stock has delivered a negative 12% annual return, 11% less than the S&P 500 Index, taking GE's market value from $390 billion to $198 billion." Forbes goes on to write that "This record and Immelt's average annual pay of $14.4 million over the last six years put him near the bottom of our performance-versus-pay scorecard. He has some contrition about this. In 2008 he declined a bonus and earned only $5.3 million."
So Campbell gets his own special spot on the Wall of Shame but Immelt is quietly passed over. General Electric, it should be noted, is the owner of CNBC news. Consequently, Jim's boss just happens to be Immelt, the CEO of General Electric. If equality means anything, when will Immelt be placed on the Wall of Shame?
PS: We own shares of General Electric
Thursday, June 11, 2009
Search Engine Shortcomings
A long standing complaint that I have had with search engines is that they disgorge a lot of irrelevant results in the form of sales pitches. Of particular concern, when searching for for product reviews, you get websites that do not have real reviews and in some cases don't even have the product! Yet you are stuck wading through this morass looking for that proverbial needle.
Of course, to be fair, these search engines would not exist if it were not the for the fact that companies are paying the search engines for this advertising. Nevertheless, it is a disservice to simply dump on the user irrelevant content. After a while, the user will get discouraged and simply not use the search engine. Displaying relevant results, in the end will promote business and user satisfaction/trust will be a lot higher. Ubersoft has an excellent cartoon related to Microsoft's new search engine Bing, that also highlights the detrimental effects of giving the user irrelevant results. (To see the image better, click on it or on the word Ubersoft.)
Of course, to be fair, these search engines would not exist if it were not the for the fact that companies are paying the search engines for this advertising. Nevertheless, it is a disservice to simply dump on the user irrelevant content. After a while, the user will get discouraged and simply not use the search engine. Displaying relevant results, in the end will promote business and user satisfaction/trust will be a lot higher. Ubersoft has an excellent cartoon related to Microsoft's new search engine Bing, that also highlights the detrimental effects of giving the user irrelevant results. (To see the image better, click on it or on the word Ubersoft.)
Wednesday, June 10, 2009
Odds and Ends
May was pretty busy, my twin daughters graduated from college. They were both accepted to graduate school so now we are busy getting prepared for that. From the perspective of bringing some sanity back to copyright law and patent law, there have been some positive developments.
TechDirt reported on May 8, 2009 that: "Court Rejects Online Terms Of Service That Reserve The Right To Change At Any Time". The underlying article from JD Supra: "District Court in Texas Rejects Online Terms of Service as Illusory and Unenforceable". In looking these articles up, I also ran across this old TechDirt article: "Court Pushes Back A Bit On Unilateral EULA Changes". The underlying court decision can be read here.
Against Monopoly also picked up on this story: "Canada rules against business method patents". Michael Geist has this write-up: "Canadian Patent Appeal Board Rules Against Business Method Patents".
In reading these posts I also thought of Ed Foster who died in 2008 and wrote the Gripe Line column for Infoworld. Christina Tynan-Wood has since taken over the column. For good or bad, the theme of the Gripe Line has returned to its original concept of working to resolve consumer complaints with computer vendors. With Ed (the column over-time) increasingly focused on abusive corporate practices, such as the ever changing EULA which has made contract law a farce. His exposure of abusive corporate practices and abusive legislation will be missed by those seeking to put sanity back into copyright law.
The Economist in May ran an online "debate" titled "Copyright and Wrongs". The premise of the debate was whether copyright law was beneficial to society or detrimental to society. A lot of good points were made. But what was unfortunate about this so-called debate is that it seemed to be between two people who support copyright and were only arguing the point of how onerous copyright law should be! Hardly a real debate.
A breath of fresh air in this debate were the comments by Ms. Jessica Litman. Ms. Litman wrote "In the past 30 years, technology has made printing presses, paper, ink, warehouses, trucks and shelf space optional. Mass dissemination need be expensive no longer. Authors can communicate directly with huge audiences. ... Technology, thus, offers an opportunity to rebalance copyright law to ensure that a larger share of the copyright bargain can be enjoyed by creators and by readers, listeners and viewers." Ms Litman goes on to say that: "Instead, we have seen the conventional distributors of 20th-century works stampeding each other into a copyright panic, and running to lawmakers with demands for greater control over both distribution and consumption. Lawmakers, for their part, have been happy to oblige them, since copyright-affected industries have a record of generosity to politicians."
As a final casual observation, the Washington Post reports: "Trump to Miss California: You're Fired". I have not followed this story that closely, but it seems that Ms. Carrie Prejean has become the victim of a character assassination whisper campaign because she actual said something she meant. What is amusing with this, in a perverse way, is that I came home and my wife was watching a show where a contestant was making her pitch before a panel of judges. The contestant said, in a typical politically correct fashion, that if she won, that she would give her money to the UN. Unexpectedly one of the judges asked her: "When was the last time you did community service?" Stunned silence followed. The look on the contestant's face said it all, concerning her hypocrisy. Its unfortunate that Ms. Prejean is paying a price she should not be paying.
TechDirt reported on May 8, 2009 that: "Court Rejects Online Terms Of Service That Reserve The Right To Change At Any Time". The underlying article from JD Supra: "District Court in Texas Rejects Online Terms of Service as Illusory and Unenforceable". In looking these articles up, I also ran across this old TechDirt article: "Court Pushes Back A Bit On Unilateral EULA Changes". The underlying court decision can be read here.
Against Monopoly also picked up on this story: "Canada rules against business method patents". Michael Geist has this write-up: "Canadian Patent Appeal Board Rules Against Business Method Patents".
In reading these posts I also thought of Ed Foster who died in 2008 and wrote the Gripe Line column for Infoworld. Christina Tynan-Wood has since taken over the column. For good or bad, the theme of the Gripe Line has returned to its original concept of working to resolve consumer complaints with computer vendors. With Ed (the column over-time) increasingly focused on abusive corporate practices, such as the ever changing EULA which has made contract law a farce. His exposure of abusive corporate practices and abusive legislation will be missed by those seeking to put sanity back into copyright law.
The Economist in May ran an online "debate" titled "Copyright and Wrongs". The premise of the debate was whether copyright law was beneficial to society or detrimental to society. A lot of good points were made. But what was unfortunate about this so-called debate is that it seemed to be between two people who support copyright and were only arguing the point of how onerous copyright law should be! Hardly a real debate.
A breath of fresh air in this debate were the comments by Ms. Jessica Litman. Ms. Litman wrote "In the past 30 years, technology has made printing presses, paper, ink, warehouses, trucks and shelf space optional. Mass dissemination need be expensive no longer. Authors can communicate directly with huge audiences. ... Technology, thus, offers an opportunity to rebalance copyright law to ensure that a larger share of the copyright bargain can be enjoyed by creators and by readers, listeners and viewers." Ms Litman goes on to say that: "Instead, we have seen the conventional distributors of 20th-century works stampeding each other into a copyright panic, and running to lawmakers with demands for greater control over both distribution and consumption. Lawmakers, for their part, have been happy to oblige them, since copyright-affected industries have a record of generosity to politicians."
As a final casual observation, the Washington Post reports: "Trump to Miss California: You're Fired". I have not followed this story that closely, but it seems that Ms. Carrie Prejean has become the victim of a character assassination whisper campaign because she actual said something she meant. What is amusing with this, in a perverse way, is that I came home and my wife was watching a show where a contestant was making her pitch before a panel of judges. The contestant said, in a typical politically correct fashion, that if she won, that she would give her money to the UN. Unexpectedly one of the judges asked her: "When was the last time you did community service?" Stunned silence followed. The look on the contestant's face said it all, concerning her hypocrisy. Its unfortunate that Ms. Prejean is paying a price she should not be paying.
Wednesday, June 3, 2009
Health Insurance and the Automotive Industry
It seems that there has been an increasing buzz in the media concerning health reform. The Washington Post writes: "Obama Signals Willingness to Compromise on Health Reform". What I think is interesting is that health insurance industry may be starting the same downward spiral that the US automakers have taken. Like the automotive industry new economic realities are emerging that may, in the end, put the health insurance industry as we know it out-of-business in a relative sense.
First, the original intent of insurance, especially health insurance, was to provide medical coverage for catastrophic events. Overtime, the health insurance industry has morphed into an industry that is providing routine coverage (such as well health examines), and other supportive services such as smoking cessation. Nothing wrong with doing that, but the costs of providing all these services has to be paid for out of the employees and companies health care premiums. This would be similar, but in a reverse sense, to the automotive industry failing to curb union wages.
Second, the health insurance companies have become bloated inefficient bureaucracies with overpaid executives like the automobile companies. These companies are now managed based on accounting not the delivery of goods and services to the consumer (patient).
Third, when you buy insurance you are, in a sense gambling. Will I get sick or not???? The insurance companies of course hope that you never get sick. In the old days, before we had medical testing, it was pretty much a random event as to whether you unfortunately won by being sick/dying or the insurance company wins by you being healthy. In the old days the insurance companies could not really test risk-factors, such as genetic diseases, that we can today.
Today the operating environment is quite different and in a sense favors the insurance companies. Individuals can now be tested for a wide variety of risk factors, such as cancer, which in theory would allow the insurance companies to better allocate their customers premiums. The insurance companies also have significant potential liabilities associated with medical care. You get injured but don't really die and have to spend years in the intensive care ward. Health care today because of the ability to test risk factors, the ability to predict susceptiblity, the availability of exotic expensive treatments, and the ability to keep people alive makes medicine today - expensive. Few people would advocate cutting costs by pulling the plug on a patient.
Fourth, the increasing cost of medical insurance has become a national issue. Like the automotive industry, the health insurance industry has simply continued to raise the price of its products and continued with this tired old business model. As with the automotive industry, the politicians are now beginning to see/taste/smell "votes" for stepping in and supposedly solving this growing concern. Clearly the hand writing is on the wall that some structural changes will be forced on the health care industry like the automotive by our non-representing politicians to save us.
First, the original intent of insurance, especially health insurance, was to provide medical coverage for catastrophic events. Overtime, the health insurance industry has morphed into an industry that is providing routine coverage (such as well health examines), and other supportive services such as smoking cessation. Nothing wrong with doing that, but the costs of providing all these services has to be paid for out of the employees and companies health care premiums. This would be similar, but in a reverse sense, to the automotive industry failing to curb union wages.
Second, the health insurance companies have become bloated inefficient bureaucracies with overpaid executives like the automobile companies. These companies are now managed based on accounting not the delivery of goods and services to the consumer (patient).
Third, when you buy insurance you are, in a sense gambling. Will I get sick or not???? The insurance companies of course hope that you never get sick. In the old days, before we had medical testing, it was pretty much a random event as to whether you unfortunately won by being sick/dying or the insurance company wins by you being healthy. In the old days the insurance companies could not really test risk-factors, such as genetic diseases, that we can today.
Today the operating environment is quite different and in a sense favors the insurance companies. Individuals can now be tested for a wide variety of risk factors, such as cancer, which in theory would allow the insurance companies to better allocate their customers premiums. The insurance companies also have significant potential liabilities associated with medical care. You get injured but don't really die and have to spend years in the intensive care ward. Health care today because of the ability to test risk factors, the ability to predict susceptiblity, the availability of exotic expensive treatments, and the ability to keep people alive makes medicine today - expensive. Few people would advocate cutting costs by pulling the plug on a patient.
Fourth, the increasing cost of medical insurance has become a national issue. Like the automotive industry, the health insurance industry has simply continued to raise the price of its products and continued with this tired old business model. As with the automotive industry, the politicians are now beginning to see/taste/smell "votes" for stepping in and supposedly solving this growing concern. Clearly the hand writing is on the wall that some structural changes will be forced on the health care industry like the automotive by our non-representing politicians to save us.
Thursday, May 28, 2009
Misplaced Regulatory Blame
The government makes a good target for the blame game. Recently a flurry articles were published "documenting" onerous government regulation. Over at the Technology Liberation Front (TLF) we have: "Privacy Regulation: Expensive and Ineffective", "Golden Age for Antitrust?", and "What the EU Doesn’t Get: Harming Competitors is Called Competition (and shouldn’t be illegal)" . Over at TechDirt we have: "More Privacy Laws Don't Mean More Privacy". My issue with these articles is that they simplistically regurgitate the mantra that government regulation is bad without even bothering to investigate if the government regulation was actually bad.
Two of the TLF articles dealt with a fine that the EU placed on Intel for alleged deceptive business practices. Braden Cox wrote that: "The European Commission is a loose cannon when it comes to antitrust and competition law." Unquestioned in the TLF articles is the issue of whether Intel did or did not pursue deceptive business practices. Even Ed Felten picked up on the concept that Intel may not be all that innocent: "European Antitrust Fines Against Intel: Possibly Justified".
Two articles dealt with the issue of "privacy". These posts were triggered by Lee Gomes writing in Forbes: "The Hidden Cost of Privacy". The concern with these posts is that the reader is lead to believe that companies are being unduly burdened with privacy regulations. The actual topic is NOT privacy regulation but the disclosure of a companies privacy policies. The companies are not being forced (against their will) to protect your privacy, they are simply being required to disclose their privacy practices. A big difference.
The vexing implications of these "blame government regulation" posts is the persistent refusal to acknowledge that companies should be held accountable for their willful actions. If Intel pursued deceptive business practices, they should be held accountable, but that question was not asked. If companies violate privacy laws, they should be identified and exposed, but that question was not asked. Before, blindly blaming government regulation for all our various ills, we need to question and examine what the responsible companies were doing.
Two of the TLF articles dealt with a fine that the EU placed on Intel for alleged deceptive business practices. Braden Cox wrote that: "The European Commission is a loose cannon when it comes to antitrust and competition law." Unquestioned in the TLF articles is the issue of whether Intel did or did not pursue deceptive business practices. Even Ed Felten picked up on the concept that Intel may not be all that innocent: "European Antitrust Fines Against Intel: Possibly Justified".
Two articles dealt with the issue of "privacy". These posts were triggered by Lee Gomes writing in Forbes: "The Hidden Cost of Privacy". The concern with these posts is that the reader is lead to believe that companies are being unduly burdened with privacy regulations. The actual topic is NOT privacy regulation but the disclosure of a companies privacy policies. The companies are not being forced (against their will) to protect your privacy, they are simply being required to disclose their privacy practices. A big difference.
The vexing implications of these "blame government regulation" posts is the persistent refusal to acknowledge that companies should be held accountable for their willful actions. If Intel pursued deceptive business practices, they should be held accountable, but that question was not asked. If companies violate privacy laws, they should be identified and exposed, but that question was not asked. Before, blindly blaming government regulation for all our various ills, we need to question and examine what the responsible companies were doing.
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