broadstuff

We first explained how Free Consumer Web Services would be funded by datamining you data 2 years ago in our paper "FreeConomics II - Why your data is free but everywhere in chains" and readers of his blog will know we have been steadily warning people of privacy erosion over the last 2 years. But we are a small and specialist blog, talking manly to early users of these technologies. We have often wondered on these pages when the abuse of Privacy will "go mainstream" - in fact we thought it would be 2009 after the Beacon fiasco, but we were overoptimistic. Now however, a Wall Street Journal article yesterday laid it all out for the first time for a larger audience - to summarise:

The Journal conducted a comprehensive study that assesses and analyzes the broad array of cookies and other surveillance technology that companies are deploying on Internet users. It reveals that the tracking of consumers has grown both far more pervasive and far more intrusive than is realized by all but a handful of people in the vanguard of the industry.

• The study found that the nation's 50 top websites on average installed 64 pieces of tracking technology onto the computers of visitors, usually with no warning. A dozen sites each installed more than a hundred. The nonprofit Wikipedia installed none.

• Tracking technology is getting smarter and more intrusive. Monitoring used to be limited mainly to "cookie" files that record websites people visit. But the Journal found new tools that scan in real time what people are doing on a Web page, then instantly assess location, income, shopping interests and even medical conditions. Some tools surreptitiously re-spawn themselves even after users try to delete them.

• These profiles of individuals, constantly refreshed, are bought and sold on stock-market-like exchanges that have sprung up in the past 18 months.

The new technologies are transforming the Internet economy. Advertisers once primarily bought ads on specific Web pages—a car ad on a car site. Now, advertisers are paying a premium to follow people around the Internet, wherever they go, with highly specific marketing messages.

In between the Internet user and the advertiser, the Journal identified more than 100 middlemen—tracking companies, data brokers and advertising networks—competing to meet the growing demand for data on individual behavior and interests.

Of course, the defenders of privacy abuse will come leaping to its defence - here is Jeff Jarvis:

I just don’t understand Julia Angwin’s scare story about cookies and ad targeting in the Wall Street Journal. That is, I don’t understand how the Journal could be so breathlessly naive, unsophisticated, and anachronistic about the basics of the modern media business. It is the Reefer Madness of the digital age: Oh my God, Mabel, they’re watching us!

If I were a conspiracy theorist — and I’m not, because I’ve found the world is rarely organized enough to conspire (and I found this to be especially true of News Corp. when I worked there, at TV Guide) — I’d imagine that the Journal ginned up this alleged exposé as a way to attack everyone else’s advertising business just as its parent company skulks behind its pay wall and surrenders its own ad business. But I’m not a conspiracy theorist. That’s why I’m confused.

The rest of the piece carries on in the same ad hominem vein ad nauseam. Great rational argument there, way to go Jeff! (But then this is the man who wrote the original Google Hagiography, so he would say that, wouldn't he ).

Pushing Out Choice to Consumers

The Intenet Advertising Board (IAB) is being a bit more subtle, as Adriana Lukas explains

Here are the important bits - the reservations about HR 5777, the Best
Practices Act proposal:

1. concept of first party data usage - "when consumers go to an online
website they understand there is going to be a certain amount of data
exchange by that first party site to serve them content and services
and yes, advertising. We think that clearly the first party (data)
usage should be exempted out of this. Choice mechanism not notice - we
should always do better around giving consumers notice to about thow
their data is collected and used

2. 3rd party data sharing - the internet is nothing but a series of
3rd party relationships. Virtually every website requires those 3rd
party data sharing whether is to customise content, to run your
analytics on the backside to make sure you know who's coming to your
site to get paid or whether it's for relevant advertising. have an opt
out ??? empowering consumers to exercise their choice when they have
legitimate concerns around privacy. You need to give them good notice,
you need to empower them and you need to educate them...

"I think, it's impossible to take information out of information age.
because if you do that you are going to get less relevant advertising
and less relevant advertising by definition is spam. And I don't think
anybody wants that - it is not good for consumers and not good for
business."

In fact its probably the HR5777 Best Practices bill draft that is starting all this kerfuffle as the lobbyists and apologists gird their loins.

Getting a Cluetrain

A reasoned riposte to all this comes from Doc Searls:

Here’s what’s delusional about all this: There is no demand for tracking by individual customers. All the demand comes from advertisers — or from companies selling to advertisers.

For now.

Here is the difference between an advertiser and an ordinary company just trying to sell stuff to customers: nothing. If a better way to sell stuff comes along — especially if customers like it better than this crap the Journal is reporting on — advertising is in trouble.

Here is the difference between an active customer who wants to buy stuff and a consumer targeted by secretive tracking bullshit: everything.

Two things are going to happen here. One is that we’ll stop putting up with it. The other is that we’ll find better ways for demand and supply to meet — ways that don’t involve tracking or the guesswork called advertising.

I’ve said it before: Improving a pain in the ass doesn’t make it a kiss.

The frontier here is on the demand side, not the supply side. Advertising may pay for lots of great stuff (such as search) that we take for granted, but advertising even at its best is guesswork. It flourishes in the absence of more efficient and direct demand-supply interactions. The idea of making advertising perfectly personal has been a holy grail of the business since Day Alpha. Now that Day Omega is approaching, thanks to creepy shit like this, the advertsing business is going to crash up against a harsh fact: “consumers” are real people, and most real people are creeped out by this stuff. Rough impersonal guesswork is tolerable. Totally personalized guesswork is not.

Searls (one of the Cluetrain Manifesto authors) some time ago started to work on VRM, which could act as an alternative to this sort of "Sales By Privacy Abuse" approach by creating tools for the customer's desies to flow to providers without the need for datamining etc.

Granted a piece in the WSJ is not yet a mass market coverage, but that will now come, when organs such as the WSJ and FT pick things up, the Qualities and then the Mass media sart to echo them. Also, the emergence of HR5777 signals that the legislative wheels are starting to turn, and that too will raise the ante from now on. I would predict that this ball has now started to roll, and the by the end of 2010 we will start to see "Respect for Online Privacy" become a major issue.

About time.........

(Hmmm - article saying much the same as this one is over here - came out after us, I claim firsts )

We first explained how Free Consumer Web Services would be funded by datamining you data 2 years ago in our paper "FreeConomics II - Why your data is free but everywhere in chains" and readers of his blog will know we have been steadily warning people of privacy erosion over the last 2 years. But we are a small and specialist blog, talking manly to early users of these technologies. We have often wondered on these pages when the abuse of Privacy will "go mainstream" - in fact we thought it would be 2009 after the Beacon fiasco, but we were overoptimistic. Now however, a Wall Street Journal article yesterday laid it all out for the first time for a larger audience - to summarise:

The Journal conducted a comprehensive study that assesses and analyzes the broad array of cookies and other surveillance technology that companies are deploying on Internet users. It reveals that the tracking of consumers has grown both far more pervasive and far more intrusive than is realized by all but a handful of people in the vanguard of the industry.

• The study found that the nation's 50 top websites on average installed 64 pieces of tracking technology onto the computers of visitors, usually with no warning. A dozen sites each installed more than a hundred. The nonprofit Wikipedia installed none.

• Tracking technology is getting smarter and more intrusive. Monitoring used to be limited mainly to "cookie" files that record websites people visit. But the Journal found new tools that scan in real time what people are doing on a Web page, then instantly assess location, income, shopping interests and even medical conditions. Some tools surreptitiously re-spawn themselves even after users try to delete them.

• These profiles of individuals, constantly refreshed, are bought and sold on stock-market-like exchanges that have sprung up in the past 18 months.

The new technologies are transforming the Internet economy. Advertisers once primarily bought ads on specific Web pages—a car ad on a car site. Now, advertisers are paying a premium to follow people around the Internet, wherever they go, with highly specific marketing messages.

In between the Internet user and the advertiser, the Journal identified more than 100 middlemen—tracking companies, data brokers and advertising networks—competing to meet the growing demand for data on individual behavior and interests.

Of course, the defenders of privacy abuse will come leaping to its defence - here is Jeff Jarvis:

I just don’t understand Julia Angwin’s scare story about cookies and ad targeting in the Wall Street Journal. That is, I don’t understand how the Journal could be so breathlessly naive, unsophisticated, and anachronistic about the basics of the modern media business. It is the Reefer Madness of the digital age: Oh my God, Mabel, they’re watching us!

If I were a conspiracy theorist — and I’m not, because I’ve found the world is rarely organized enough to conspire (and I found this to be especially true of News Corp. when I worked there, at TV Guide) — I’d imagine that the Journal ginned up this alleged exposé as a way to attack everyone else’s advertising business just as its parent company skulks behind its pay wall and surrenders its own ad business. But I’m not a conspiracy theorist. That’s why I’m confused.

The rest of the piece carries on in the same ad hominem vein ad nauseam. Great rational argument there, way to go Jeff! (But then this is the man who wrote the original Google Hagiography, so he would say that, wouldn't he ).

Pushing Out Choice to Consumers

The Intenet Advertising Board (IAB) is being a bit more subtle, as Adriana Lukas explains

Here are the important bits - the reservations about HR 5777, the Best
Practices Act proposal:

1. concept of first party data usage - "when consumers go to an online
website they understand there is going to be a certain amount of data
exchange by that first party site to serve them content and services
and yes, advertising. We think that clearly the first party (data)
usage should be exempted out of this. Choice mechanism not notice - we
should always do better around giving consumers notice to about thow
their data is collected and used

2. 3rd party data sharing - the internet is nothing but a series of
3rd party relationships. Virtually every website requires those 3rd
party data sharing whether is to customise content, to run your
analytics on the backside to make sure you know who's coming to your
site to get paid or whether it's for relevant advertising. have an opt
out ??? empowering consumers to exercise their choice when they have
legitimate concerns around privacy. You need to give them good notice,
you need to empower them and you need to educate them...

"I think, it's impossible to take information out of information age.
because if you do that you are going to get less relevant advertising
and less relevant advertising by definition is spam. And I don't think
anybody wants that - it is not good for consumers and not good for
business."

In fact its probably the HR5777 Best Practices bill draft that is starting all this kerfuffle as the lobbyists and apologists gird their loins.

Getting a Cluetrain

A reasoned riposte to all this comes from Doc Searls:

Here’s what’s delusional about all this: There is no demand for tracking by individual customers. All the demand comes from advertisers — or from companies selling to advertisers.

For now.

Here is the difference between an advertiser and an ordinary company just trying to sell stuff to customers: nothing. If a better way to sell stuff comes along — especially if customers like it better than this crap the Journal is reporting on — advertising is in trouble.

Here is the difference between an active customer who wants to buy stuff and a consumer targeted by secretive tracking bullshit: everything.

Two things are going to happen here. One is that we’ll stop putting up with it. The other is that we’ll find better ways for demand and supply to meet — ways that don’t involve tracking or the guesswork called advertising.

I’ve said it before: Improving a pain in the ass doesn’t make it a kiss.

The frontier here is on the demand side, not the supply side. Advertising may pay for lots of great stuff (such as search) that we take for granted, but advertising even at its best is guesswork. It flourishes in the absence of more efficient and direct demand-supply interactions. The idea of making advertising perfectly personal has been a holy grail of the business since Day Alpha. Now that Day Omega is approaching, thanks to creepy shit like this, the advertsing business is going to crash up against a harsh fact: “consumers” are real people, and most real people are creeped out by this stuff. Rough impersonal guesswork is tolerable. Totally personalized guesswork is not.

Searls (one of the Cluetrain Manifesto authors) some time ago started to work on VRM, which could act as an alternative to this sort of "Sales By Privacy Abuse" approach by creating tools for the customer's desies to flow to providers without the need for datamining etc.

Granted a piece in the WSJ is not yet a mass market coverage, but that will now come, when organs such as the WSJ and FT pick things up, the Qualities and then the Mass media sart to echo them. Also, the emergence of HR5777 signals that the legislative wheels are starting to turn, and that too will raise the ante from now on. I would predict that this ball has now started to roll, and the by the end of 2010 we will start to see "Respect for Online Privacy" become a major issue.

About time.........

(Hmmm - article saying much the same as this one is over here - came out after us, I claim firsts )

Large research house punctures Location Based Services hype shocker - AdAge:

Marketers, hold off on Foursquare -- for now. That's the verdict of Forrester Research on location-based start-ups, which, despite their reputation as the hot new media, are still too small for major marketers. The research firm finds that these heavily-hyped apps currently make sense mainly for brands seeking male influencers.

In a study out today, Forrester finds that only 4% of U.S. online adults have ever used location-based mobile apps such as Foursquare, Gowalla and Loopt. Only 1% update these services more than once per week. What's more, 84% of respondents said they are not familiar with such apps, leaving the vast majority of Americans online still in the dark about location-based apps, which have had the marketing world obsessing over them in recent months.

The report could also be a wake-up call for social media on mobile phones, especially when comparing the location services to the last social-media darling, Twitter. The micro-blogging service reports 35% of its 125 million registered users are in the U.S. and only a fraction of that number accesses Twitter via mobile. In April, Twitter said 37% of its usage comes via mobile clients. Apply that percentage to U.S. tweeters -- we must extrapolate because the company does not break out U.S. users via mobile specifically -- and the 16 million Americans using Twitter via mobile is about comparable to the location-apps audience in total.

Kudos to Forrester for being realistic. As one of the commentators on the piece says:

Wow - for once, Forrester isn't riding the social media bandwagon and it gets taken to the woodshed by the commenters.

Step back for a sec, take a breath, and look at it thru the lens of "I'm in a marketing organization with big sales goals but very very limited resources so where should i be prioritizing my investments?" and you might see that Forrester's recos on LBS are helpful.

This is quite interesting, because the usual pattern for the big research houses is to hype up the new new thing, so one wonders why Forresters (among all of them) have decided to puncture the Location Based Service bubble rather than run with it

(This is not to say that it won't one day be an order of maginitude larger, just not now - its too early)

Interesting article in New Scientist about digital anthropology providing the sort of data that will allow it to become a science:

Social scientists have long had to rely on crude questionnaires or interviews to gather data to test their theories; methods marred by reporting bias and small survey sizes. For decades, the field has been looked down upon by some as a poor cousin to the hard sciences. The digital age is changing all that - practically overnight, the study of human behaviour and social interactions has switched, from having virtually no hard data to drowning in the stuff. As a result, an entirely different approach to social science has emerged, and studies based on it are appearing with increasing frequency. The impact has been remarkable.

"The data revolution is here for social science," says Albert-László Barabási of Northeastern University in Boston. "For the first time, scientists have a chance to study what humans do in real time and in an objective way. It's going to fundamentally change all fields of science that deal with humans."

Barabasi, old hands may recall, was one of the early thinkers on Social Networking as a predictive science. what Malcolm Gladwell called the Tipping Point. Curiously, one of the experimeters looking at how this worked was a Gladwell critic, Duncan Watts:

To examine what made some songs more successful than others, Watts and Salganik created a project called Music Lab. It featured a website where more than 14,000 people listened to any of 48 songs by relatively unknown bands, rated them, and downloaded them if they wanted. These options provided a measure of quality (the average rating given) and popularity (the number or downloads). Crucially, the duo were also able to control whether listeners could see how many times other people had downloaded any particular song, or instead had to rely solely on their own judgement. In this way, they could effectively compare outcomes with the power of social influence turned on or off. They also grouped the socially influenced participants into eight independent "worlds" so that they could explore how the outcomes - the popularity rankings of the various tunes, based on downloads - might change if the tape of history could be rewound and run again.

The results strongly support the idea that human influence has a huge effect in making some songs more popular than others. This factor also makes it much harder to predict what will happen, and which songs will do well. The worlds in which social influence was operating had much higher inequality - with popular songs going up and unpopular songs going down to an even greater extent than in the worlds lacking social influence. With social influence turned on, song popularities fluctuated wildly between one world to the next. So, like it or not, it seems like many of us follow the herd.

As we pointed out at the time, Watt's attack on Gladwell was more about positioning that point of order. The article goes on to talk about an experiment that shows we have two natures - an investgative and a sheep like following nature, and the one tips over into the other in much the same way as other systems change state -

Onnela and Reed-Tsochas realised that analogous changes take place in Facebook, on which people share their profiles with their online friends. Facebook users can also choose to install applications - software components that personalise their Facebook page. If one person adopts an app, their friends are automatically notified, and they can also see the apps their friends are using. Facebook users also have access to a list of popular applications, akin to a best-sellers list.

.......

The data stored on Facebook makes it possible to analyse the growth in popularity of individual applications in unprecedented detail. Onnela and Reed-Tsochas analysed the popularity of several thousand applications in 2007, shortly after those apps were introduced, and then studied how other users adopted them over time. They looked to see if the sequence of adoptions for each app followed an essentially random pattern - indicating that each "adoption event" was independent of other previous adoptions - or whether previous adoptions by a participant's friends influenced the likelihood of their subsequent adoption of an app.

The results showed that both independent thinking and copying behaviour play a role, reinforcing conclusions reached by conventional survey methods. However, the study also indicated there are two very different processes in action. On the one hand, their analysis shows, at first, when a new app appears it is adopted by users independently of their friends' opinion. But if the popularity of an app crosses a threshold, its very popularity then seems to draw many people to adopt it, and its growth can become explosive. Just as Watts and Salganik found in their Music Lab experiment.

"We found very distinct regimes in which individual or collective behaviour dominates. The change from one to the other is a sharp on/off process," says Reed-Tsochas. They don't yet know whether tipping points of this kind might influence real-world processes beyond the web, such as shifts in political opinions or the popularity of books. "It's certainly possible," says Reed-Tsochas, "but we'll need to wait for equally good data in those areas to find out."

Others are looking at Twitter's ability to predict movie popularity

Huberman and his colleague Sitarum Asur wondered if it might be possible to do even better by exploiting the enormous volume of opinion expressed through social media such as Facebook and Twitter. Opinions voiced in these media, they reasoned, should have strong predictive power because they actually play a role in determining which films do well. "What gets discussed through these media often ends up setting trends," says Huberman.

In an attempt to mine these opinions, they studied the chatter on the microblogging site Twitter. They started from the supposition that movies that get talked about a lot - that generate a lot of buzz - should end up being more popular. To measure the buzz for each film, they looked at the rate at which it generated tweets immediately following its release. They used this as a predictor of the ultimate film sales.

The results show that the rate at which movie tweets were generated can provide accurate predictions of box-office revenue, more accurate even than the Hollywood Stock Exchange. In the end, predicting successful movies may only be of interest to film companies and investors. But Asur and Huberman reckon this is just the beginning, and that their technique should be able to predict social outcomes of many kinds. "When properly tapped, social media express a collective wisdom which can yield an extremely powerful and accurate indicator of future outcomes," says Asur.

Huberman says such analyses could soon help predict many other events, such as election outcomes, or quickly gauge public reactions to major events, just as long as we have evidence reflecting peoples' views on the relevant issue. "Twitter and texting in general were influential in the election of Barack Obama and some businesses are already analysing these kinds of data to assess the likely success of their products," says Huberman.

(Cass Business School's Dr Caroline Wiertz presented corollary findings at TEDxTUttle II, by the way). Anyway, what is emerging is something akin to Isaac Asimov's science of Psychohistory - we are all different, but en masse we are remarkably predictable:

It's the discovery of underlying patterns of this kind that has excited so many scientists. Given the undeniable complexity of individual human beings, it's not as if social science is going to become like physics, grounded in eternal and general laws, but access to data on human events makes it possible to identify the patterns that do exist and these can be useful for demystifying the social world.

Interesting times...........................

Fascinating - 3 Old Media Newspapers are the medium of choice for Afghanistan war wikileaks:

The huge cache of classified papers - described as one of the biggest leaks in US military history - was given to the New York Times, the Guardian and the German news magazine, Der Spiegel.

What is most interesting is why Wikileaks - a Web 2.0 User Generated Content site if there ever was one - chose Mainstream media as its organ of publication and dissemination rather than just getting it out there on the Web. If there is one thing this proves, it is that the role of the Olde Media is far from redundant. The deep throating may now be very 2.0, but the reporting is an interesting combination of Old Hacks drinking from New bottles.

(Update - there is a rather good debate going on in The Atlantic on what this all implies for Journalism)

As to the actual incidents themselves, there will no doubt be a lot of hand wringing from the self-declared sensitive types, but the more prosaic truth about these facts is that this sort of thing was ever thus (Allied exploits in WW2 do not make them out as angels at all, and just ask the average British tankie about US "friendly fire" in the Gulf Wars), its just its all come out in the open this time (A process that started in the Crimea, by the way).

And, no doubt Western generals everywhere will be worrying that they have to fight with one hand tied behind their backs while the enemy have no such limitations. But the more prosaic truth about the leaks is that this sort of leaking will become more common, and that governments and corporates everyhere will now redouble efforts to stop it.

That the best way to prevent corruption is to shine a light into the dark areas is very true, but it is also true that some areas ned to stay dark for the safety of those fighting on "our side". What will be interesting is to see how a "new contract" is formed between States and their people over the next 10 years or so - States will know the stuff wll come out, most of its citizens will realise a State sometimes has to do what it needs to. Ditto with Corporate malfeasance (where the "have to do what we have to do" carries less weight, methinks).

If I were to make a guess, its that most citizens already knew that War is a gory business, that Afghanistan was going far less well than the Governments claimed and the media reported it as going (The mediarati are going into overdrive today, but where were the investigative media before this, one wonders....) and that much of this is news, but not New news. It merely adds detail to already provable hypotheses.

Anyways, the Grauniad's page explaining the data is over here, and here is the Excel spreadsheet (They couldn't put it on Google Docs as it can't handle files that size)

PS - I loved this comment on Slashdot - pretty much sums up my view of the whole sorry episode:

According to the CIA World Fact Book: [cia.gov]

Population: 29,121,286
GDP (Per capita:) $800 (2009 est.)

So now, expenditure over six years (Jan 2004 - Dec 2009) is $300,000,000,000.00 divided by six is around $50,000,000,000.00 per year

Per capita is $1,716.96 or more than double the GDP per capita of the country!

I would think that the US would get better resultsif the money was simply given to each inhabitant, the $800 they already make plus $1,700 from the US, would triple the GDP per capita, no small feat.

Just smile for the camera and show that you have not handled explosives or fired guns in the last week (paraffin test) and you get your weekly expenditure; you don't show up for a week then you lose the privilege, i.e. you knew you couldn't pàss the test.

Who said "You Can Rent an Afghan But Never Buy One"? It would rent the whole lot of them for a long time!

News that Nokia is looking to replace it's CEO - WSJ:

The world's largest handset making is calling for a new CEO, sources told the Wall Street Journal on Monday. WSJ Corporate Bureau Chief Andrew Dowell and Dow Jones Newswires' Rob Armstrong join the Digits show to discuss possible successors to Olli-Pekka Kallasvuo, and how heavily Nokia should focus on a new mobile software strategy.

............

While Nokia continues to sell more cellphones than any other manufacturer, it has failed to keep up with advances by such rivals as Apple Inc. and makers of smartphones running Google Inc. operating software.

The Espoo, Finland, company's failure to get back in the race has taken a toll. Its stock rose eight cents to $8.82 in 4 p.m. New York Stock Exchange trading Monday but is off nearly 42% since April 19.

This is a story that starts pre-iPhone - before this blog even started in 2007 we had done analysis showing Nokia was losing ground on usability of its handsets, and the tardiness of their response to the iPhone has been an indication that the corporate culture is unable to come to grips with the new smartphone market. There has been a few chairs shifted at the top, but we suspect more root and branch change to company culture is required* - a totally independent unit in another country perhaps?

Still, its not just Nokia that is struggling - news out today that 70% of iPhone users would buy a new iPhone, but only 20% of Android users will buy a new Android - the reason is also one of Nokia's main problems:

Google has to work with .... handset manufacturers who have their own agenda. Unfortunately that agenda very often conflicts with customer needs. Old habits die hard for this manufacturers who still insist on adding more crap to the phone and complicating them. The lesson that everyone should learn from Jobs is less is more. Less is more.

For "Handset manufacturers", replace with "Nokia".

*Removing a CEO is seldom enough to change the culture of a company, which is usually promulgated by senior middle managers proecting their own positions.

Yet another early Facebook stakeholder has crawled out the woodpile, this time claiming 50% of The Face Book - SAI:

The first transaction, which appears undisputed at this point, covers web-development work Mark was to perform for a Paul Ceglia company called StreetFax. No issue there.

The SECOND transaction (and this is the key part) calls for Paul to PURCHASE (yes, it says "purchase") a 50% interest in a project that Mark is already working on--an online yearbook for Harvard students known as "The Face Book". There are also penalties for late completion that increase this ownership percentage over time.

The reference to "The Face Book" transaction is repeated many times, in separate sections of the contract.

As SAI is quick to point out, there are a few things that need sorting first:

Where is the original contract (and has a judge seen it)?

The document we have all now seen appears to be an electronic copy of paper-based contract. Electronic documents are vastly easier to forge or doctor than paper-based documents. The first order of business, therefore, is for both parties to examine the original contract to assess whether it is genuine. This analysis will eventually likely include ink testing and other forensic analysis.

Why did Paul Ceglia wait 7 years to make this claim?

Facebook's vast value has hardly been a secret for the past few years. In 2007, Microsoft invested in the company at a valuation of $15 billion. It seems beyond bizarre that, if Paul Ceglia remembered this contract existed, he would wait until now to file this lawsuit. The most plausible explanation might be that he forgot about the contract and then stumbled upon it. But "why now?" would seem a simple and reasonable question for him to answer, especially in light of the fact that he and his wife were arrested for grand larceny last year for allegedly defrauding customers of his wood-pellet company. (That doesn't mean he's guilty of defrauding customers or that he's now trying to defraud Facebook, but it certainly makes this a reasonable question.)

Where is the payment-trail evidence?

If Paul Ceglia gave Mark Zuckerberg $1,000 to fund "The Face Book" in exchange for 50% ownership in the entity, there is presumably a simple payment trail we can follow that proves this. This would take the form of a canceled check, perhaps, or a wire transfer. It is presumably possible that Ceglia made the payment in cash, but this would be highly unusual, even for a payment this small (normally, when you make an investment in a company, you WANT a payment trail).

In other words it is pretty clear cut that we don't know enough yet to know if the document is genuine, never mind whether there is a case or not. Of course this hasn't stopped every TV and Blog lawyer (and non lawyers) jumping on the bandwagon.

However, two things that do make this curiously more credible:

(i) This is not the first time Mark Zuckerberg has paid other people who claimed similar, (in a strictly no-fault way you understand)

(ii) So far the strongest denial from Camp Zuckerberg has been that "I think we were quite sure that we did not sign a contract that says that they have any right to ownership over Facebook,"

Being non-lawyers and not on TV, as yet we refuse to prognosticate on the validity of the document. But on past form, we're offering 3/2 odds on a payoff

The Faebook Story - its somethin you just couldn't make up - no one would believe it!

It has been clear for many years that the big New Tech analysis houses exaggerate the future impact of (sales, penetration, benefits etc) of new technologies (the Gartner Hype Curve was invented for the sector after all). The reason is also fairly well known - no one buys research from people who tell it like it is most likely to be, because then few business cases would fly, few VCs would invest and then where would we be.

We routinely divide Mobile industry projections by 2, as we know most will be reduced to this level 2 years later.

What I had never really understood though is why Tech Analysts from the Investment Banks were the most overoptimisitc in the dotcom boom (Henry Blodgett and Mary Meeker are the most infamous). An explanation from McKinsey shows why:

McKinsey research shows that equity analysts have been overoptimistic for the past quarter century: on average, their earnings-growth estimates—ranging from 10 to 12 percent annually, compared with actual growth of 6 percent—were almost 100 percent too high. Only in years of strong growth, such as 2003 to 2006, when actual earnings caught up with earlier predictions, do these forecasts hit the mark.

The capital markets, by contrast, have been more realistic: except during the 1999–2001 market bubble, actual price-to-earnings ratios were 25 percent lower than those implied by the forecasts of analysts.

So there you have it - Tech Analysts over hype, Equity Analysts are Overoptimistic, so Tech Equity Analysts...well, the 2x2 above explains it all

Researchers at the Northeastern University College of Computer and Information Sciences, along with researchers from Harvard Medical School, set out to determine how happy or sad Americans are at different times of the day and week by looking at happiness indices implied in Twts - NYT

Some of the results are more obvious than others. For example, during the workweek people are happier in the early morning and late evening, before and after the daily grind.

Researchers also observed interesting geographic results. People sending Twitter messages on the West Coast seem happier “in a pattern that is consistently three hours behind the East Coast.” Over all, judging from a video the researchers created, when Twitter users are upset, the most negative areas appear to be the middle of the country and the East Coast.

The research also found that people are much happier on weekends; the peak of happiness on Twitter is reached on Sunday mornings. The unhappiest moments are on Thursday evenings, before the last day of the workweek begins.

To visualize the data the research team created maps called cartograms, in which the sizes of states are based on the number of Twitter messages originating from them.

They looked at 300 million twts over a 3 year period. Overall report is over here

As the NYT notes, Twitter is becoming the Digital Anthropological equivalent of Rwanda and Uganda'a Gorillas and Chimpanzees.

Fred Wilson on RWW talking about premium privacy:

Wilson suggests that while large companies like Twitter, Facebook, Google and Yahoo could set a precedence for privacy, from an infrastructural outlook it is harder for them to roll back and scale permissions to their huge social graphs.

He says, "The challenge for large social networks is to undo permissions that they've already given. Meanwhile, a startup is at an advantage as they can build something from scratch that allows the user to predefine the data terms for sharing."

Our own Marshall Kirkpatrick has criticized a number of Facebook's privacy policy decisions, and Wilson echos this need for user education and control.

"When you reveal your specific location, it's very important that you have control over that... There are business opportunities in privacy-related services," Wilson says. "The challenge is to get someone [whether business or consumer] to pay $2-$10 dollars per month to ensure that sort of premium privacy."

Three very interesting implications which come out of this:

(i) There is an increasing opportunity to use privacy as a differentiator vs the existing SocNets - my own view is stronger than Fred's in that I think there will be a large backlash against the current privacy scrapers. You won't see it in massive user turnoff, more just the slow reduction in activity and people who still "live" on that site until it becomes an online Ghost Town.

(ii) Privacy potentially has a business model of its own, called pay-conomics - but how to get most people to pay $24 - $120 per annum is not easy. I thus suspect these services will have to offer more than simple social connectivity. Clearly location based gaming is one extra suit, but (in my view anyway) its possibly a fad, or (more likely) a feature that will be integrated into more comprehensve services.

(iii) Who will use Premium Privacy? In my view it will be the same outcome as Free to Air (Ad supported) TV - ie the people with money will opt for a No Ads / No Scrape service (thus removing the most valuable people the Ads / Scrapers want to target) while the remaining 80% get left to the mercy of crappy "Free to Scrape" SocNet services.

I await with interest to see which Private SocNet Fred winds up funding