Listening to Russ Roberts of EconTalk discuss his wardrobe and his relative cluelessness with regard to fashion, my thoughts turned to software engineers. I wondered if both economists and software engineers believe that there’s some kind of optimization algorithm for selecting clothing.
In an episode of EconTalk, Johanna Blakely talks with Roberts about how the lack of copyright protection in the fashion industry turns it into an economy of continuous innovation. There are some interesting lessons here regarding the relationship between originals and copies, remixing and the circulation of design motifs.
Download EconTalk: Johanna Blakely on Fashion and IP
Somehow it seems unlikely that the technology/media business will look to fashion as an inspiration for viable business models. But it’s clear they could learn a thing or two. As you look across the landscape of technology companies, only Apple (despite the fact that Jony Ive never changes his T-shirt), has managed to create a release cycle that in many ways mirrors the major fashion houses. They release new designs annually and then watch the knock-off shops go to work trying to replicate their products. And like the top fashion houses, Apple is driven to be creative, to set the next trend that puts them one step ahead.
The fashion world still honors and rewards the creators of fresh and original looks. Since there’s no regulatory friction hindering fast followers with good-enough copies, the market is filled with cheap knock-offs. Both seem to survive in the ecosystem. One reason for this is that the copies are not digital— they aren’t exact atom-for-atom copies of the originals. Generally, to lower the price of the knock-off, the materials have to be cheaper. In the world of bits, exact replication is just a matter of a few key strokes. There’s no such thing as cheaper or more expensive bits. One of the more interesting trends in fashion is the designer who copies herself. Rather than cede the low-end knock-off market, the designer executes low-end copies of her signature styles for mass distribution through the fast-fashion retailers.
You can learn a lot about the economics of the technology business by simply viewing each of the major vendors as a fashion house.
Google and Twitter have filed a amicus brief with the appeals court on TheFlyOnTheWall.com case. Briefly, at issue is FlyOnTheWall’s near real-time redistribution of investment bank research ratings. Investment bank research departments spend time, money and resources creating stock ratings and price targets. The purpose of this effort is to create an information asymmetry in the market to the advantage of the i-bank’s clients. FlyOnTheWall does not employ analysts and has no research capability, it discovers stock ratings, aggregates and redistributes them in near real time. Since their cost of production only includes real-time redistribution infrastructure, and therefore they can offer their high-value information feeds at a lower cost than investment banks. Subscribers to FlyOnTheWall pay for these aggregated news feeds, they aren’t free. In their testimony, FlyOnTheWall claimed they only gathered information from publicly available sources and only published tweet-sized snippets summarizing the reports.
Google and Twitter make the following argument in their brief:
News reporting always has been a complex ecosystem, where what is ‘news’ is often driven by certain influential news organizations, with others republishing or broadcasting those facts — all to the benefit of the public,
and further
How, for example, would a court pick a time period during which facts about the recent Times Square bombing attempt would be non-reportable by others?”
At issue is the re-emergence of the hot news doctrine, which was originally put in place in 1918 to stop William Randolf Hearst’s International News Service from taking Associated Press wire news stories and redistributing them as their own. The court set forth five criteria to determine whether ‘hot news’ has been misappropriated:
(i) a plaintiff generates or gathers information at a cost;
(ii) the information is time-sensitive;
(iii) a defendant’s use of the information constitutes free riding on the plaintiff’s efforts;
(iv) the defendant is in direct competition with a product or service offered by the plaintiffs;
(v) the ability of other parties to free-ride on the efforts of the plaintiff or others would so reduce the incentive to produce the product or service that its existence or quality would be substantially threatened.
In the case of TheFlyOnTheWall.com the court ruled for the plaintiffs, Barclays, Merrill Lynch and Morgan Stanley, and decided that a 2 hour embargo was a reasonable amount of latency to build into the Network. In the fast-paced world of equity trading, two hours is an eternity. These days trades are often executed in a matter of milliseconds. The enforcement of this kind of rule, however, is problematic. In the brave new world of social media, both individuals and news organizations have interconnected real-time distribution networks. Once bits of information touch this public social network they can spread with breathtaking speed. Twitter, Google and Facebook are currently the media through which this information is dispersed. And each of them can be said to profit by the circulation of high-value information through their networks.
Over the last few days we’ve seen the drama of General Stanley A. McChrystal play out. The events were put into play by a story written by Michael Hastings, a freelancer for Rolling Stone Magazine. The story about McChrystal’s comments began leaking out Monday night. Both Politico and Time magazine posted a PDF of the Rolling Stone article to their web sites before Rolling Stone. Rolling Stone asked the sites to remove the PDF. The New York Times reports:
Will Dana, the magazine’s managing editor, said that the magazine did not always post articles online because it could make more money at the newsstand and that when it did, the articles were typically not posted until Wednesday. But other news organizations made that decision for him.
The McChrystal story is an interesting example of the ‘hot news’ doctrine. Rolling Stone magazine puts out 26 issues of its print magazine per year. Even before the issue hit the newsstands, it dominated cable news, has been fully reported in the New York Times and resulted in McChrystal’s resignation and replacement by General David Petraeus. One could argue that Rolling Stone should have a business model that allows them to benefit from these kind of real-time events. And it’s quite possible that the broad dissemination of this story will lead to a significant increase in newsstand sales and web site traffic.
In this case the ‘hot news’ was so hot that the story itself became a story. Major government policies regarding the conduct of the war in Afghanistan had to be decided in real time. There was no hesitation, no waiting for Rolling Stone’s newsstand business model to play out. By the time we finally see the printed magazine it will have become an artifact of history. With the advantage of hindsight, we may even wonder why the headline writer put McChrystal’s story third after Lady Gaga’s tell all and the final days of Dennis Hopper.
The question about the ‘hot news’ doctrine isn’t going away; and the decision of the appeals court will be closely watched. In the meanwhile, the marketplace is searching for a solution to the fact of real-time aggregation and relay of digitally-copied work product. The return of the pay wall is an attempt by producers of stories about the news to create a firewall around their work product. Most corporations employ a firewall to keep their valuable internal discussion from reaching the public networks. Limiting access of your product to paying customers isn’t a new idea. However, when your work product is a story about news events or ideas encoded in digital media, creating reliable access controls is problematic. Where in the early days of the Network the focus was on direct access and disintermediation of the middle man; now the economics favor the man-in-the-middle. Meta-data can be sold at a fraction of the price of the data to which it points. The complex ecosystem of ‘the news’ is looking for a new equilibrium in which both data and meta-data can flourish.
The corporate web site used to have a brilliant excuse for its plain and simple execution. It needed the broadest possible distribution across browsers and operating systems. All customers, regardless of the technical specs of their rig, needed to be served. Some basic HTML, a few images, a conservative dollop of CSS and javascript. Transactions and data are all handled on the back end with a round trip to the server for each and every update of the display. And the display? Order up a screen resolution that serves 90%+ of the installed base as reported by server logs. Make that 800 x 600, just to be sure. This down level, conservative approach has been baked into enterprise content management systems and a boundary has been drawn around what’s possible with a corporate web presence. Mobile web was even simpler, a down level version of a down level experience. Rich internet applications (RIAs) were put into the same category as custom desktop apps, generally not worth the effort.
The usability tests we have conducted during the last year have shown an increasing reluctance among users to accept innovations in Web design. The prevailing attitude is to request designs that are similar to everything else people see on the Web.
When we tested advanced home page concepts we got our fingers slapped hard by the users: I don’t have time to learn special conventions for your site as one user said. Other users said, Just give it to us plain and simple, using interaction techniques we already know from other sites.
The Web is establishing expectations for narrative flow and user options and users want pages to fit within these expectations. A major reason for this evolving genre is that users frequently move back and forth between pages on different sites and that the entire corpus of the Web constitutes a single interwoven user experience rather than a set of separate publications that are accessed one at a time the way traditional books and newspapers are. The Web as a whole is the foundation of the user interface and any individual site is nothing but a speck in the Web universe.
Adoption of modern browsers was thought to be a very slow process. In 1999, Jakob Nielsen insists that we would be stuck with old browsers for a minimum of three years. Here was another reason to keep things plain and simple.
The slow uptake speeds and the bugs and inconsistencies in advanced browser features constitute a cloud with a distinct silver lining: Recognizing that we are stuck with old technology for some time frees sites from being consumed by technology considerations and focuses them on content, customer service, and usability. Back to basics indeed: that’s what sells since that’s what users want.
Over time, a couple things changed. The web standards movement gained traction with the people who build web sites. That meant figuring out what CSS could really do and working through the transition from table-based layouts to div-based layouts. Libraries like Jquery erased the differences between browser implementations of javascript. XMLhttpRequest, originally created for the web version of Microsoft’s Outlook, emerged as AJAX and turned into a defacto browser standard. The page reload could be eliminated as a requirement for a data refresh. The Webkit HTML engine was open sourced by Apple, and Google, along with a number of other mobile device makers, began to release Webkit-based browsers. With Apple, Google, Microsoft and Mozilla all jumping on the HTML5 band wagon, there’s a real motivation to move users off of pre-standards era browsers. Even Microsoft has joined the Kill IE6 movement.
The computing power of the cloud combined with the transition from a web of documents to a web of applications has changed the equation. Throw in the rise of real-time and the emergence of social media: and you’ve got an entirely different ballgame. With the massive user embrace of the iPhone, and an iPad being sold every three seconds, we might want to re-ask the question: what do users want?
Jakob Nielsen, jumps back to 1993 in an effort to preserve his business model of plain and simple:
The first crop of iPad apps revived memories of Web designs from 1993, when Mosaic first introduced the image map that made it possible for any part of any picture to become a UI element. As a result, graphic designers went wild: anything they could draw could be a UI, whether it made sense or not.
It’s the same with iPad apps: anything you can show and touch can be a UI on this device. There are no standards and no expectations.
Worse, there are often no perceived affordances for how various screen elements respond when touched. The prevailing aesthetic is very much that of flat images that fill the screen as if they were etched. There’s no lighting model or pseudo-dimensionality to indicate raised or lowered visual elements that call out to be activated.
More important, gestures lack critical clues deemed essential for successful human-computer interaction. Because gestures are ephemeral, they do not leave behind any record of their path, which means that if one makes a gesture and either gets no response or the wrong response, there is little information available to help understand why. The requisite feedback is lacking. Moreover, a pure gestural system makes it difficult to discover the set of possibilities and the precise dynamics of execution. These problems can be overcome, of course, but only by adding conventional interface elements, such as menus, help systems, traces, tutorials, undo operations, and other forms of feedback and guides.
Touch-based interfaces built around natural interaction metaphors have only made a life for themselves outside of the research laboratory for a few years now. However I tend to think that if these interfaces were as baffling for users as Norman and Nielsen make them out to be the iPhone and iPad would have crashed and burned. Instead they can barely make them fast enough to keep up with the orders.
The classic vanilla flavored corporate web site assumes that users have old browsers and don’t want anything that doesn’t look like everything else. All new flavors are inconceivable without years and years of work by standards bodies, research labs, and the odd de facto behavior blessed by extensive usability testing. There’s a big transition ahead for the corporate web presence. Users are way ahead and already enjoying all kinds of exotic flavors.
June 16th is known as Bloomsday; it’s the single day, in 1904, on which James Joyce’s novel Ulysses occurs. The day is commemorated around with the world with readings of the book and the hoisting of a pint or two.
Stately, plump Buck Mulligan came from the stairhead, bearing a bowl of lather on which a mirror and a razor lay crossed. A yellow dressinggown, ungirdled, was sustained gently behind him by the mild morning air. He held the bowl aloft and intoned:
— Introibo ad altare Dei.
Halted, he peered down the dark winding stairs and called up coarsely:
— Come up Kinch. Come up , you fearful jesuit.
Solemnly he came forward and mounted the round gunrest. He faced about and blessed gravely thrice the tower, the surrounding country and the awakening mountains. Then, catching sight of Stephen Dedalus, he bent towards him and made rapid crosses in the air, gurgling in his throat and shaking his head. Stephen Dedalus, displeased and sleepy, leaned his arms on the top of the staircase and looked coldly at the shaking, gurgling face that blessed him, equine in its length, and at the light untonsured hair, grained and hued like pale oak.
Buck Mulligan peeped an instant under the mirror and then covered the bowl smartly.
Joyce’s book brought to popular notice the idea of stream of consciousness literature. The term “stream of consciousness” was coined by the philosopher William James in an attempt to describe the mind-world connection as it relates the concept of truth. As a literary technique, it involves writing as a kind of transcription of the inner thought process of a character. In Ulysses, we find that stream rife with puns, allusions and parodies. Joyce was trying to capture another aspect of truth.
What challenged the reader of the day as avant garde and daring has become a relatively normal part of our network-connected lives.
Twitter has become a part of my daystream
– Roger Ebert
The stream of tweets flowing out of Twitter could aptly be described as a stream of collective consciousness. And so today, we think a great deal about various real-time streams and how they wend their way through networks of social connection. The water metaphors we use to speak about these things have roots in our shared history; they describe another kind of network of connections.
With the university system languishing amid archaic traditions, and corporate R&D labs still on the distant horizon, the public space of the coffeehouse served as the central hub of innovation in British society. How much of the Enlightenment do we owe to coffee? Most of the epic developments in England between 1650 and 1800 that still warrant a mention in the history textbooks have a coffeehouse lurking at some crucial juncture in their story. The restoration of Charles II, Newton’s theory of gravity, the South Sea Bubble— they all came about, in part, because England had developed a taste for coffee, and a fondness for the kind of informal networking and shoptalk that the coffeehouses enabled. Lloyd’s of London was once just Edward Lloyd’s coffeehouse, until the shipowners and merchants started clustering there, and collectively invented the modern insurance company. …coffeehouse culture was cross-disciplinary by nature, the conversations freely roaming from electricity, to the abuses of Parliament, to the fate of dissenting churches.
But the coffeehouse as a nexus of debate was only half of the picture. Cultural practice at the time was to drink beer and wine, and maybe a little gin, at every opportunity. Water was not safe to drink, and so alcoholic alternatives were fondly embraced. The introduction of coffee and tea as popular beverages had a significant impact on the flow of valuable ideas. Again here’s Johnson:
The rise of coffeehouse culture influenced more than just the information networks of the Enlightenment; it also transformed the neurochemical networks in the brains of all those newfound coffee-drinkers. Coffee is a stimulant that has been clinically proven to improve cognitive function— particularly for memory related tasks— during the first cup or two. Increase the amount of “smart” drugs flowing through individual brains, and the collective intelligence of the culture will become smarter, if enough people get hooked.
In our day, the coffee house connected to a wifi network has been an accelerant to the businesses populating the Network. When Starbucks announced that they would be introducing free 1-click wifi in their stores, it reminded me of Stephen Johnson’s descriptions of the London coffeehouses. The coffeehouse provided a physical meeting place and the caffeine in the coffee provided a force multiplier for the ideas flowing through the people. There was a noticeable change in the rhythm of the age. By layering a virtual real-time social medium over a physical meeting place that serves legal stimulants, Starbucks replays a classic formula. Oddly, there’s a kind of collaborative energy that exists in the coffeehouse that has been completely expunged from the corporate workplace. Starbucks ups the ante by running a broadcast web service network through the connection. Here we see wifi emerging as the new backbone for narrowcasted television.
As we try to weave value-laden real-time message streams through the collaborative groupware surgically attached to the corporate balance sheet, we may do well to look back toward Bloomsday and also ask for a stream of unconsciousness. It’s in those empty moments between the times when we focus our attention that daydreams and poetic thought creep into the mix. Those “empty moments” are under attack as a kind of system latency. However it’s in those day dreams, poetic thoughts and napkin scribbles that we find the source of the non-linear jump. Without those moments in our waking life, we’re limited to only those things deemed “possible.”
