Weekend News Round-up

22 Aug 2011

A trawl through some of the tech stories in the weekend’s papers including how Silicon Valley is looking nervously at the global economic picture, how the patents arm race could hurt the tech industry and politicians seeking social media ‘kill switches’ to thwart rioters.

Why the recession never troubled Silicon Valley … until now

The New York Times carried a fascinating insight into Silicon Valley culture and how the region and its global mindset have so far appeared untroubled by the choppy economic waters. But that may change as the wider economic picture and of course fears of a double-dip recession are beginning to haunt the tech industry.

“There’s a ‘greater-fool theory,’ ” says Lise Buyer, who was a tech stock analyst during the dot-com bubble and is back with a consulting firm, the Class V Group, that advises on initial public offerings. “In Silicon Valley, we are as a species wildly optimistic. But if we weren’t, we wouldn’t have so many entrepreneurs because no one who’s being rational would ever found a company.”

And so start-ups are multiplying. Engineers are deciding that this is the right time to create would-be Groupons or Facebooks — “me-too companies,” valley speak for start-ups that are basically copycats of a winning formula — or yet another local, social mobile app.

The patents bubble shows the dark side of Silicon Valley’s hubris

Despite the optimism and sunny disposition of the Silicon Valley brigade, anyone who truly cares about the technology industry would be very concerned about the spate of patent lawsuits taking place and the damage this could entail for true innovation. The Washington Post reported how in Silicon Valley, patents have become the competitive weapon of choice, used by high-tech giants to bludgeon rivals and crush upstarts.

It turns out that the more patents you have, the more likely it is that you can extort exorbitant royalties from people who might have easily come up with the same idea or the same feature that you did but never thought to patent it. And the more patents you have, the more your competitor wants so he can retaliate with a patent suit of his own, claiming that it was you who stole the ideas from him. In other words, it’s an arms race to buy as many patents as possible, bidding up the price of patents without anyone gaining a permanent competitive advantage.

Google gobbles Motorola – what it means for the web giant

The Financial Times had an interesting profile of Google CEO Larry Page, which delved into the innovation culture at the web giant and questioned if the US$12.5bn acquisition of Motorola Mobility might unbalance the 13 year-old firm’s start-up ethos and approach to R&D.

If Google is built on an unbounded belief in the power of big ideas then Mr Page has always been its guiding spirit, a fact confirmed when it was announced that he would take over the company’s top position in April 2011. But this week, that outsized thinking revealed itself in an acquisition more fit for the humdrum world of corporate wheeling and dealing than for the rarefied air of the Googleplex.

Serendipity? There’s no such thing!

In another interesting analysis of innovation at Google, The Observer had an interest piece on how ‘serendeipity’ is anything but a happy coincidence. Google it says wants to be the director of our dreams.

“Serendipity” is the latest Holy Grail in the Silicon Valley software zeitgeist: an ill-defined buzzword that developers use to describe services that will connect people with online ephemera they would not normally find on their own. Yet a website’s success relies on delivering successes, and something that tries to predict serendipity will fail almost every time.

A riotous debate over social media – where’s the kill switch?

The Observer also looked into the use of social media by rioters in the UK during the recent disturbances – resulting in politicians looking for powers to shut down Twitter, BlackBerry, Facebook and other platforms if unrest emerges again.

Companies and politicians are being forced to rethink the extent to which governments or the police should be able interfere with communication networks. This year has seen at least two heavy-handed interventions. The Egyptian government ordered the closure of Vodafone’s network, and those of other operators, during the Tahrir square uprising. Vodafone remained down for 24 hours, and when service resumed the company was strong-armed into sending out pro-government text messages urging demonstrators to stay at home.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years