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Blackbox Republic: “Velvet rope” socialnet targets niche social dating

There are few certainties in the world. One clear phenomenon is that the Burning Man Festival continues to spawn innovative online communities. The most recent virtual entrée into the online maelstrom, Blackbox Republic, was conceived on the seventeen hour trip back from the scorching sands of the playa on Black Rock Desert, according to Sam Lawrence, CEO and co-founder.

The new site, which will go live at 9 PM PST today, is play for the hearts (and wallets) of people “who don’t consider themselves mainstream and are looking for a place to privately explore their personal lives” and aren’t finding satisfaction in the algorithm-driven pairing from sites like Match.com, Chemistry.com or the uncertainties of Craigslist.org.

Blackbox Republic combines features from many different virtual communities that have become familiar as the Web 2.0 bubble as waxed and waned:

  • social networking, like Facebook
  • status updates, like Twitter
  • event planning, like eVite or MyPunchBowl.com
  • image and video sharing, Flickr

The design of the site, as shown on the right, features an updated take on the familiar status box and public areas of social networks.
The vision, as laid out by Lawrence in a phone call last night, is that Blackbox Republic will combine those features in a protected environment that allows users to connect freely, with more privacy than in other networks. Users have to be vouched for, says Lawrence, and granular controls for sharing mean that once they’re approved, a given update can be shared as publicly or privately as desired. Users can integrate Facebook and Twitter into the platform, allowing a public update to be broadcast widely.

One element where Blackbox Republic shows some evolution from previous social dating sites is its event generation and management features. Users can invite people inside and outside of the social network to an event. If they choose, they can create a public destination page that’s available to non-users without exposing more than location details and numbers to external visitors.

It’s worth observing that this is one social network that is not designed for underage visitors nor for those uncomfortable with more progressive approaches to love, relationships and intimacy.

Blackbox Republic offers subscription-based social dating for “all orientations, relationship combinations and lifestyles,” a description that could describe the openness of the Burning Man festival as well.

That hasn’t made all parties happy, at least where traditional business are concerned: as Lawrence shared on his blog, State Farm chose not to underwrite “social software that helps people meet online.” Lawrence says that an iPhone app is in the works, although who knows what Apple will do when it comes social dating.

Social networking fatigue is a reality for many online users. Adding one more to the mix means that users will need to find it easy to use, responsive and secure, especially given the privacy that is at issue in this context. Niche social networks are likely to be a major growth area next year, as companies and organizations use Ning.com and similar platforms to create focused communities. Whether the strategy behind this “velvet roped” social network garners enough subscribers that find the slick design and social dating feature set attractive enough to make it a viable business will be worth watching in 2010.

Disclosure: Sam Lawrence is a friend, stemming back to his time as CMO at Jive Software. I received no compensation, food, services or other swag from writing about this new venture – As with most new creative online endeavors created by smart people, I just found it interesting.

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Ode to Boston: Of Friends, Fried Clams and Fans

I moved to the District of Columbia this summer. I originally drafted this post in August, early in the steep rise of the learning curve for navigating around Washington. Aside from the humidity, heat and the clouds of mosquitos that showed up late in the afternoon, I like my new home.

A classmate, Graham Nelson, asked me whether “I missed Boston at all” that month on Twitter.

It was easy to answer that answer simply: Yes, I do. Particularly the people, but any number of other things, too.

Since 140 characters was utterly insufficient, here’s my list of things I miss about Boston, in no particular order.

1. New England weather. If you don’t like it, wait 15 minutes. I particularly miss August on the Cape, since DC was beastly humid when I arrived. I might miss it less in February.

2. Fresh lobster, bought on the dock, from the lobsterman or the local “lobstah coop.” Steamed, grilled, boiled, baked in a clambake.

3. Late night “cold tea” in Chinatown.

4. The Esplanade. Despite the fissure of Storrow Drive snaking between Back Bay and the grassy shores next to the Charles, I spent many happy hours running, cycling, reading or walking there. I’m glad I went to July 4th at the Hatch Shell this year with the ‘rents.

5. Proximity to natural escapes. Forests, mountains and ocean are all available in less than an hour in any direction. 2 hours took you to New Hampshire, 3 to Maine or Vermont.

6. Boston Media Makers. I’ve been going to DC Media Makers but this group of bloggers, videographers, artists, writers, hackers, technologists and characters taught me something new whenever I attended. Thank you, Steve Garfield.

7. For that matter, I miss Doyle’s, where Media Makers meets. Doyle’s is a Boston institution for politicians and JP residents alike, and serves a damn good pint of stout.

8. Pizza. Sure, pies in NYC are consistently better but I used to be able to easily enjoy thin crust deliciousness from Oggi, Upper Crust, Armando’s, Cambridge 1, Emma’s, the Pleasant Cafe or Pinocchio’s Sicilian-style slice. I haven’t found a pizzeria to match any of them yet in DC.

9. Harvard’s museums. I live near world-class institutions in DC now, to be fair, and the Smithsonian’s price is right. That said, I enjoyed learning at the Peabody & Fogg.

10. Since I’m on to museums, add the Museum of Fine Arts. The special exhibition of Da Vinci recently was particularly fine.

11. The Isabella Stuart Gardner. Jazz in the courtyard in the summer? Sign me up.

12. The Science Museum. Endless geeky wonders, terrific traveling exhibitions. I saw the art of the Lord of the Rings there, BodyWorks, and many other geeky wonders.

13. The new Institute for Contemporary Art. Gorgeous architecture, on the waterfront. Live music and dancing in the summer.

14. Harvard, particularly the Berkman Center. I learned much from its fellows and professors, though happily much of their work and writing is made available online.

15. The Red Sox and Red Sox Nation. When a game is on, the entire region is full of the sound of the calls and reactions. When the season is over, the hot stoves sizzles all winter. Some people hate Boston sports fans. I found the transition from long-suffering foils to champions to be redemptive in the best possible way.

16. Fenway Park. It’s a baseball temple. I’m sure I’ll catch a few Nationals games now that I’m in DC. I don’t expect the same experience!

17. Might as well throw the Patriots and Celtics in, as well. I realize that both teams may elicit groans from around the league and country, for any number of reasons, but I’m happy to have rooted for the Pats in 2001 and the Celtics’ Big 3 when each made their championship runs, even if I grew up as a Phillies and Eagles fan.

18. Fresh Pond. Moving nearby Cambridge’s reservoir gave Shadow and I more than two years of jogging pleasure.

19. Cycling on the Minuteman Bikeway.

20. The WBOS Earthfest at the Hatch Shell. Some years were better than others. I still smile about waiting out the rain to see Sheryl Crow.

21. Swimming, reading and reveling in simplicity at Walden Pond.

22. Striper fishing at Castle Island.

23. Enjoying a cocktail from the Top of the Hub.

24. Researching and writing in the Boston Public Library‘s Reading Room.

25. Irish seisiúns at the Burren or Kitty O’Sheas.

26. The Head of the Charles (although I’ll never attend again with a bad mustache.)

27. Patriot’s Day: The Boston Marathon and a Red Sox game, all on a regional holiday? Good times.

28. Canoeing, kayaking and sailing on the Charles River

29. Tower Records on Newbury Street. Closed for years now, but I enjoyed browsing albums there.

30. Trident Booksellers. There are many terrific bookstores in Boston. Trident includes a fantastic magazine rack and tons of healthy brunch options.

31. Harvard Bookstore. My favorite bookstore in the region, bar none.

32. Burdick’s Chocolate. The best hot chocolate in Boston, bar none, right in Harvard Square.

33. Woodman’s. Sure, those sublime fried clams are up in Essex, on the North Shore, but I never minded the trip, especially combined with a visit to Crane’s Beach. I miss being proximate to both, along with Wingaershaek Beach and Singing Sand Beach, a bit further down the coast.

34. The Public Gardens. Regardless of the season, walking by the ducklings and stately trees feels quintessentially Bostonian.

35. Shakespeare in the Park. Classic plays, under the stars on Boston Common with a picnic? Loved it.

36. High tea at the Four Seasons.

37. MIT. I miss easy access to the lectures, films, speakers and geeky community of this world-class institution.

38. Lectures at the First Unitarian Church in Harvard Square.

39. The Arnold Arboretum, year-round, but particularly during the spring. Sledding down Peters Hill with the greyhound was memorable too.

40. Live music at the Middle East, the Wonder Bar, the Orpheum, the Paradise and the Somerville Theater.

41. Universal Hub. Adam Gaffin’s hyperlocal blog remains the best place to look for news that mattered around Greater Boston, from morning to late at night.

42. Ace Wheelworks. I’ve found a few decent bike mechanics in DC but no one in the same class for service or quality. They kept me tuned up and repaired for a decade.

43. Jamaica Pond. Whether it was fishing, sailing, rowing, cycling, running, reading or enjoying an amble in the annual Lantern Parade, this kettlehole pond was always a joy to visit.

44. Charlie’s Kitchen. Great beer? Comfort food, served until late at night? A new bier garden? I miss you, Charlie’s.

45. The Diesel Cafe. Once the Someday Cafe closed and turned into a creperie, this Davis Square coffeehaus became a great option for a red eye or other high octane beverage. Crema‘s terroir cup of joe in Harvard Square made for tasty jave jive too.

46. The mixology at Drink, Green Street Grille, Noir and Craigie on Main.

47. The Freedom Trail, stretching from the gold dome of the Capitol to Bunker Hill Monument. Walkable history.

48. The North End, for pignoli, a great slice, ever-changing Italian cuisine, gelato, good cappucino and a walk down Hanover Street during summer festivals or under holiday lights.

48. Savenor’s, for when the ingredients needed to be a few cuts above what I could gather at Shaw’s, Whole Foods, Harvest Coop or the farmer’s market.

49. Dinner out. Sure, DC has no shortage of great eateries, although due to its role as a political nexus, Washington is a bit heavy on the steakhouses. I’ll miss sushi at Oishii, ribs at Blue Ribbon, chowder on the patio at Legal’s in Harvard Square, tapas at Cuchi Cuchi, paella at Oleana, skate wing at Blue Room, chicken at Hammersley’s or Clio — and anything involving meat at Craigie on Main. I could write thousands of words about Boston’s restaurants.

50. Friends. Boston truly is the Hub of the social media universe. Boston’s community is on par with much larger communities in Silicon Valley, New York or London, and its influence on the social networks of the world is far outside of the raw user numbers.

I’m thinking about digerati like Chris Brogan, Paul Gillin and Laura Fitton.

I wish I could have spent more time learning from Andrew McAfee, Doc Searls, danah boyd, David StephensonDavid Weinberger, Ethan Zuckerman, Yochai Benkler or Jonathan Zittrain. Or that I’d met @Ed in person.

I also really miss seeing friends like Shava Nerad and her companion, Tuna Oddfellow, around town too. Or Brian Del Vecchio, Mike Schneider, Laurel Ruma, Rachel Happe, Gradon Tripp, Jeff Cutler, Eric Andersen, Thomas Edwards, Ari Herzog, Doug Haslam, Todd Van Hoosear, Bob Collins, Adam Zand, Leslie Poston, Rebecca Corliss, Christina Major, Chris Penn, Mike Krigsman, Mike Langford, Al Willis, and Jim Storer.

I wish D.C. had someone as energetic as Tom “@BostonTweet” O’Keefe around to share what was happening around the city.

And I miss seeing past or current colleagues like Jack Loftus, Yuval Shavit, Dana Gillin, Dana Brundage, Andrew Burton, Bill Brenner, Barney Beal, Dennis Fisher, Rachel Lebeaux, Kristen Caretta, Michael Morisy, Linda Tucci, Eric Pierce, Elisa Gabbert and Beth Pariseau too.

I know I’ve left many friends out but don’t want to leave this “ode to Boston” feeling like the orchestra at the Academy Awards is playing me out as I frantically list people to recognize. (Too late? It was great fun seeing what each was up online pulling together these links. There are many other friends who haven’t put up virtual selves who aren’t added here.)

If we should be connected on Facebook, Twitter and LinkedIn, I trust that we are. If not, click away.

Reblog this post [with Zemanta]I’m enjoying my new life in DC, on many levels. After a decade in Boston, however, there are endless moments to savor. Enjoy Beantown, my friends. I hope I’ll get back to the Hub soon.

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I do not like retweets and spam. I do not like like them Spam-I-am.

My friend Elisa asked me what I thought of the new RT feature of Twitter, since, as she tweeted, I’m an “add value” kind of guy.

Here’s what I think so far: I’m not a big fan. I don’t think I’ll use the feature much if I can avoid it.

But I think I understand the issue that Twitter has on its hands. I just finished writing an article on a security panel composed of federal CISOs last week, where the topic of the secure use of social media dominated the discussion. The conference was on application security, which meant that standards for authentication, identity and verifiability were elevated in importance.

As a DHS security official put it, “one of the fundamental issues with the Internet is that sending a trusted message is difficult. We don’t have any kind of mechanism like that for rapid fire social media communications.”

Trust but verify has been the watchword for me whenever I have decided to RT something for years  now. Is the link safe? Who had control of the account? What other accounts were associated with the tweet and how were they annotated? Tricky, especially in the real-time.

Twitter’s own terms of service are crystal clear about its Impersonation, Trademark, and Terms of Service policies:

“Re-posting other’s content without attribution and without their permission is a violation of Twitter’s rules. Accounts that re-post others’ updates (with or without crediting the author) may be immediately suspended because

  • Re-posting others’ updates as one’s own without giving credit to the original author is tantamount to plagiarism
  • Re-posting or others’ updates, regardless of stating authorship, is a potential form of spam.”

And yet, we have the RT, which reposts the content of others.

Tricky, no? That’s at least part of the reason that some folks have said that a  RT = Spam.

I think the RT caught on and stuck around because it gave attribution and offered a simple, user-generated mechanism for users to share the content of others using microsyntax. I’ve argued that a RT is social media currency.

In aggregate, many retweets of the same message can build both trust in the content and validity of a link or quote. That implied veracity, given by those phatics of trust, can be in turn dangerous. Messages that went viral and contained a link to a malware-laden page or to a phishing syndicate are like viruses circulating around a Twitter biosphere, given the stamp of approval by the brands of trusted senders.

The number of RTs a message receives has also been one of the most useful metrics used to measure the rapid growth of social messaging on Twitter. If you haven’t read danah boyd’s draft IEEE paper on the RT, “Tweet, Tweet, Retweet,” it’s worth your time if you’re interested in how digital ethnography applies to Twitter.

Earlier this week, Twitter rolled another community generated convention into its code with a new RT button. First came the @reply, which was replaced by @mention. Now, we have retweets. Sort of.

(What follows is a conversation I had earlier this week with my friend, Ed Shahzade, on first impressions.)

When @leolaporte tweeted that “Twitter would have been better off implementing its “retweet” feature as “like.” That’s all it really is,” I retweeted him, adding “Spot on” before the RT.

Ed @replied to us: “That’s so far off. It’s republishing, not putting a star on the only copy. It’s like adding to a friend’s newspaper.”

“I disagree,” I @replied. “IMHO, the coding isn’t how the community has used RTs. Implementation amounts to a positive rating, removes annotation.”

“Yes, my chief complaint is lack of commentary(option),” @replied @Ed. “They could have listened better. Bear in mind- fraud prevention was a goal.”

“I understand,” I @replied.

That was because Ed is right, after all. Verifiable messaging is an issue as old as human communication. It’s a serious issue for use in crisis response for government. There are unscrupulous criminals and bored teenagers at play in the system.

But the way that this was implemented may really upset the community and users can still be bad actors under the current system. I’d rather see some kind of system where the highest rated tweets can be ranked by meta juice from likes. Xeni Jardin recently tweeted that she’d like a “spam” button IN the tweet, next to reply, RT and Favorite.

I’m not sure about that feature, given the potential for abuse, but a Flag might be helpful as a way of adding a thumbs down or “dislike” feature. That “dislike,” after all, has cropped up on Facebook, along with the “Like” feature that’s so familiar to Friendfeed users.

Perhaps a RT could be attributed in API and still allow the retweeting user to appear inline? The attribution for tweet sourcing is built into the current code. The issue is that substitutions of those that we do not follow in our timelines are jarring to many.

Part of Twitter’s allure, at least for me, lies in having control over your timeline. Follow, unfollow, block, spam, RT, etc.

I don’t like the new RT but I understand that better trust and authentication mechanisms need to be built in to prevent fraud and ensure better online security for Twitter. I do think an audit trail is key, so that users can easily follow RTs to an original and compare if they like. I do that constantly if I need to verify who said what when. And I like to annotate the tweets.

The reason that it’s important to get the coding right on spam, security and authentication, however, doesn’t rest in my usage. I’m an IT journalist, after all. I find Twitter useful, educational and frequently entertaining but I can live and work perfectly well without it. And, to be blunt, I know it will survive without me.

Many enterprises block social networking platforms like Facebook and Twitter precisely because of such security concerns, along with resilient questions about productivity.  Earlier this week, I reported on a study that surveyed senior IT security executives at federal agencies. Outsourcing, an increasingly mobile workforce and cyberterrorism topped the lists of their security concerns, along with unstructured data resulting from social networking platforms and Web 2.0.

If Twitter is really going to be a “global information utility” for government private industry and nonprofits, security and trust will be at issue. So will privacy. Twitter updated its privacy policy to “explicitly include geotagging and to describe the public nature of most of what people post to Twitter.”

For Twitter to effectively compete and thrive, adding features that don’t map to how its community uses them may not be in its best interest. Since I’m a long-time user and have found it useful, I hope that the feedback they receive is replicated in the code.

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Amended Google Books Settlement: analysis & reactions

Yesterday, Brad Stone and Miguel Heft reported at the New York Times that the terms of the digital book deal with Google had been revised.

Danny Sullivan has written an excellent post on the amended Google Books settlement, where he liveblogged the press call and links to many other excellent resources, including the discussion on TechMeme.

The Amended Settlement Agreement (11/13/2009) is embedded below.

Google’s official response contained a link to a summary of the changes made here and includes a FAQ. More information is also available at th Google Books settlement page.

The Open Book Alliance has posted its own response to the Google Book Settlement.

Echoing the dismissal of the amendments by the Open Book Alliance, which called it “sleight of hand, Peter Brantley,  (as quoted in the Financial Times) said that “None of the proposed changes appear to address the fundamental flaws illuminated by the Department of Justice and other critics that impact public interest.” Brantley is director of the Internet Archive, which has been archiving digital content for years and has proposed an alternate vision for e-books, OpenLibrary.org.

I’m still reading through the settlement. The amendments would create a trustee for each one of the so-called “orphan works.” As Stone and Helft reported at the Times, “that trustee, with Congressional approval, can grant licenses to other companies who also want to sell these books, and will oversee the pool of unclaimed funds that they generate. If the money goes unclaimed for 10 years, according to the revised settlement, it will go to philanthropy and to an effort to locate rights holders. In the original settlement, unclaimed funds reverted to known rights holders after five years.”

The settlement also reduces the number of books that Google may proceed to digitize into its catalog at Google Books to books published in the United States, Britain, Australia or Canada.

“The changes will mean that 95 per cent of all foreign works will no longer be included in Google’s digital book archive,” said Richard Sarnoff, chairman of the Association of American Publishers, as quoted by Richard Waters in the Financial Times.

As Waters also pointed out, the settlement “also means that ,illions of out-of-print works that could previously only be found in a handful of university research libraries.” For researchers like Alexis Madrigal of Wired Magazine, who wished earlier for the parties involved to find a way to preserve Google Books, this settlement is one step closer to a successful resolution.

For authors or their trustees, it’s more complex. Whether amendments go far enough in providing other Internet companies with the means to successfully compete in providing an index of digitized books is not immediately clear. There’s going to be scrutiny of the settlement from the Department of Justice over the coming weeks, not to mention Congress. If Google remains as only company able to offer a comprehensive archive of all digital books to online readers, antitrust concerns may force further adjustments by the search giant.

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A night at the Spy Museum: What keeps cybersecurity experts awake at night?

photo(2)Last week, I enjoyed an unusual evening: a panel of some of the nation’s preeminent cybersecurity experts at the International Spy Museum. I didn’t have to practice any spycraft to learn more about the risks posted to national security and business in cyberspace.

Michael Assante, chief security officer for the North American Electric Reliability Corporation (NERC),  warned of cybersecurity threats and risks to the smart grid.

Melissa Hathaway, President Obama’s former”” called for more public and private cybersecurity partnerships.

James Lewis, director and senior fellow of the Technology and Public Policy Program at the Center for Strategic and International Studies, described how new rules for cyberwar are being defined as cybersecurity threats grow.

Those interested in cybersecurity may find the article and posts linked to above useful.

When asked “what keeps them up at night,” each panelist responded thoughtfully.

Melissa Hathaway is worried about “our overall economic competitiveness” due to corporate cyberespionage. Assante is concerned about restoring a lack of confidence after a massive cyberattack. And James Lewis is concerned that a scenario from World War II might repeat itself in a future cyberwar.

“Think of Germans in WWII,” he suggested. “The Brits were able to break the Enigma machine through Program Ultra. That probably shortened the war by two or three years. I worry that whomever we might be fighting would know what we’re going to do before we do it.” Lewis is concerned about more than anticipation: what if opponents were to change the data, replicating the “fog of war” online?

“Look at the DOD’s ‘Blue Force Tracker – if that were compromised, the first thing is that you’d shoot your own folks,” he said. “Second, every commander would slow down.” ( The New York Times‘ excellent “At War” blog published a post today about the digital fog of war, in fact, though its author focused on the challenges of using technology in the background, not the scenario wherein it is compromised.)

Keith Epstein, the veteran investigative journalist who moderated the “Emerging Cyber Threats” panel, observed that he’s noticed a reluctance of people to really talk about this. What can be done? Assante calls the lack of public discussion a “plague of suffering and silence. “In the electric system, our regulations require entities to, if they have a cyberattack, to report them.” Despite the concerns of some in Congress, he suggested that agencies reconsider safe harbor. “We have to be willing to share information with our allies.”

What are the scenarios that will enable cybersecurity to move forward?

Start with raising public awareness, said Lewis, which would require the mainstream media to cover cybersecurity with the seriousness that the threat deserves.

“There’s a bunch of other things we could do too, “ he said. “Make better use of the DoD. Define their role in a way where they can defend cyberspace. Work with the private sector. There are many things we can do to incentivize better cybersecurity. International engagement: Reach out to allies – and maybe to opponents.”

Hathaway observed that “we are considering a national data breach law. Our allies are considering similar legislation.” S.1490, the Personal Data Privacy and Security Act of 2009, would require data brokers and companies to both establish and implement data privacy and security programs. Hathaway said that “we need to start talking about the issue: the fleecing of America.”

In her view, it’s not just consumer behavior that’s at issue: “We have the Tylenol scare in all of our computers. It’s there and they’re not telling us.”

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25 Inspirational Dog Portrait Photographs

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Dogalicious.

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Sunday meditation: a media meal in a news snacking universe

On Friday, Dan Conover wrote a terrific long-form narrative essay about long-form narrative, in which he made a case for “a non-narrative future for journalism.”

To further illustrate his point in practice, he also created a three-page, home-printer-optimized PDF for readers “who prefer to read long-form essays on paper” and “a shorter, semi-structured online summary” that is remarkably like a Gawker post, sans snark.

I think he’s on to something, both in approach, example and analysis of news consumption in the present. I’m not alone in comparing consuming media on the real-time Web to dining:  Steve Rubel described Twitter as “a sushi boat moving at 100 mph.” Fine dining, fast.

Perusing the menu

And since I enjoy cooking, dining and reading, the following metaphor for news flow and how we consume our daily “media meals” came readily to mind.

If reading were like dining:

An amuse-bouche is like a tweet. It’s the essence of the cook’s art, delights the palate and leaves you wanting more.

An appetizer is like a blog post. That could be a microblog post, too. Appetizers can be either light or heavy.

An entree is like a long-form narrative article. Sides include video, graphics and comments.

Dessert is like a money quote, figure or key analysis. It’s something the reader can savor, including a link to save or share.

Of course, there’s plenty of flexibility in the concept.

As @stevebuttry suggested today, for instance, an interactive database might be a recipe.

News organizations are now considering how to deliver news in a way that provides value, draws readers and perhaps solvency.

I suspect making it easy for readers to” consume media” as the readers wish may be as important for the success of online media outlets as making dining enjoyable has been for restaurants during the recession.

Time to go enjoy Sunday dinner: reading feeds & enjoying a smorgasbord of vegetables, cheese, brown beer and sausage.

 

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Business innovation through IT: “Computers create more productivity”

During the roaring 90s, technology evangelists convinced business owners to drop millions on IT equipment to cash in on productivity gains and chase digital goldmines online. A decade later, MIT professor Eric Brynjolfsson has published a new book entitled “Wired for Innovation: How Information Technology is Reshaping the Economy.”  He also recently co-authored “The New, Faster Face of Innovation” in the Wall Street Journal/Sloan Management Review.

innovation-ITProfessor Brynjolfsson presented the findings from his book at the Information Technology and Innovation Foundation in Washington earlier today. After breaking down the components of a large IT project, the bulk of which consist of implementation and deployment, he examined  Dell Computers as a case study in IT innovation.

Professor Brynjolfsson visited a Dell factory, a bustling manufacturer where most PCs are built to completion in one day. During his visit, he noticed that the back third of the factory empty. He suggested to the Dell executive that was taking him on the tour that perhaps that space wasted.

The reply? “We used to use it but don’t need it any more. We’re producing more in less space.”

Brynjolfsson said that Dell had implemented i2 software and completed a business process redesign to gain these efficiencies. Orders are transmitted customers go right to suppliers, which deliver new parts to the facility every 4 hours in a classic case of “just-in-time manufacturing.” Managers are able to both see problems earlier and fix them, leading to a substantial improvement in efficiency.

The exec called up Brynjolffsson later to let him know Dell was now using that extra space, producing twice as much from the factory as a year earlier. In essence, says Brynjollfson, Dell had “built a second factory” – except that it was made of business processes and software, representing intangible assets. “That’s a microcosm of what’s been going on in the US economy,” he observed.

Photomontage showing what a complete iceberg m...
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In that larger context, “computerization” has a greater effect than computers.

Brynjollfsson used the metaphor of an iceberg to describe the role of organizational assets. In that sense, IT capitol and other technological investment are the visible portion of  much vaster organizational complements below the surface. As he put it, “intangible assets are more important in the information economy”

Brynjollfsson cited an broad analysis by MIT of organizational assets, including 1167 large firms over 10 years and 10,473 observations.

The analysis colllected4 principle types of data:

  1. Revenue/market value.
  2. Computer capital from computer intelligence.
  3. Ordinary capitol, labor, other assets, R&D.
  4. Organizational assets.

Results?

Brynjollfsson cited three key findings, including identification of a distinct set of business practices common to heavy IT users.

  1. The “digital organization.” That concept describes a distinct corporate culture and organizational process are found at most (but not all) heavy users of computers and the Internet
  2. Higher productivity and higher market value. Firms that adopt this digital organization have higher performance
  3. IT and the digital organization are complements. Firms that adopt the digital organization and simultaneously invest more in IT have disproportionately higher performance.

According to Brynjollfsson, there are 7 identifiable practices of digital organizations:

  1. Move from analog to digital business process.
  2. Distribute decision-making rights.
  3. Foster open information access.
  4. Link incentives to performance.
  5. Maintain focus and communicate goals.
  6. Hire the best people.
  7. Invest in human capitol.

If these practices are better – and they’re noticeably better, says Brynjollsson – why aren’t they being adapted? The dispersion between successes and failures has been growing, if anything, in recent years. What’s the story?

A member of the audience suggested a well-known model at MIT, system dynamics, where a feedback loop that of poor practices trapped organizations in negative spirals.  Byrnjollfson observed as well that decisions that can be quantified or structured are becoming more centralized. Older & bigger firms had a harder time, both in terms of company & employee age. “Most of our metrics were focused on business performance: productivity, profitability, market value. When we asked about employees, we found employees were also better off.” According to Byrnjollfson, firms which adopt the tenets of digital organizations have higher pay, from top to bottom and are less likely to have turnover.

The bottom line, in terms of the professor’s findings, is that information technology is a catalyst for a productivity surge but that  organizational change is the bulk of the iceberg, so to speak. Payoffs only come when investments are made in both IT infrastucture and training, education and incentives in a coherent sytem.

He cautioned, however, that the IT investments of some organization were both overstated and overvalued during the dotcom bubbles, where intangibles were used to justify stratospheric valuations.  Many companies invested beyond an optimal point, and in assets that inevitably decreased in both value and utility over time.

These gains are also realizable only in the context of talented, educated knowledge workers. “Technology investments require more skilled workforce,’ he said. “If you make investments in IT education, you help narrow the wage gap.”

He ended by making an analogy to the invention of  microscopy by Anton Van Leeuwenhoek, which in turn led to a revolution in medicine and biology. In Professor  Brynjollfson’s view, the revolution in data flows inside companies and bureaucracy has the potential to lead to substantial improvements in public policy. The paradigm of managing large organizations through the analysis of real-time manufacturing data can be applied to economic policy, healthcare and energy, to name a few areas of far-reaching potential.

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National Institute of Food and Agriculture (NIFA) launches in DC

This afternoon, I was privileged to be at hand at the National Press Club today when Secretary of Agriculture Vilsack launched the National Institute of Food & Agriculture (NIFA).

Agriculture Secretary Vilsack speaks at the National Press Club

Agriculture Secretary Vilsack speaks at the National Press Club

The new institute’s website is http://nifa.usda.gov.

And, it being 2009, you can followed NIFA at @USDA_NIFA on Twitter.

According to Secretary Vilsack, ” NIFA will be the Department’s extramural research enterprise. It is no exaggeration to say that NIFA will be a research “start-up” company – we will be rebuilding our competitive grants program from the ground up to generate real results for the American people. To lead NIFA, President Obama has tapped a preeminent plant scientist from the Danforth Plant Science Center in St. Louis – Roger N. Beachy, winner of the Wolf Prize in Agriculture and a member of the National Academy of Sciences.”

As I mentioned on Twitter, @FoodSafety and @USDAFoodSafety are  already up and tweeting.

Among other many agricultural science initiatives, secretary Vilsack emphasized that this new USDA institution will identify agriculture opportunities in U.S. that, within 10 years, will be “net carbon sinks.”

“USDA science will support our efforts to radically improve food safety for all Americans,” said secretary Vilsack. “Each year in the U.S. alone, food-borne pathogens like E. coli kill 5,000 people and sicken 75 million more; the cost to the economy from these infections exceeds $35 billion.”

Following the Secetary’s remarks, Rajiv “Raj” Shaw, Under Secretary of Agriculture for Research, Education, and Economics (REE) and Chief Scientist at the United States Department of Agriculture, provided an overview of the different areas agricultural science could positively affect both the energy policy of the United States, food security and, in time, hunger at a global scale.

Raj Shah at the NIFA launch

Raj Shah at the NIFA launch

Following Shah, the @WhiteHouse science advisor, Dr. Holdren, t, leavened the event with casual humor of an agricultural variety, punning his way into a wave of chuckles.

Dr. Holdren was clearly inspired by what he’d seen at the “Astronomy Night” at the White House last night.

More information and video of that event is available at http://blog.ostp.gov, courtesy of @WhiteHouseOSTP.

Video of the event, including the remarks of all three men, is archived and available on demand at VisualWebcaster.com: NIFA launch at National Press Club.

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