What’s good for General Motors…

Fair or not, we Silicon Valley types maintain a low opinion of ‘Washington’, as in Congress and the Executive, the Federal Government.  The Bush years haven’t helped with a long list of offenses against liberties, science, fiscal prudence and just plain decency.  And, just when we thought we’d hit bottom, we reach a new nadir.  I’m referring to the shameful spectacle of our solons, civil (self-) servants and Detroit executives all haggling over the why, how much, when and how of the US auto industry bailout. More

Journalism : Crowd reporting rises – bizmodel stays flat

I began catching up with events in Mumbai Wednesday at 1:00am in a Kiev hotel room. I started with frenzied remote control shuttling between CNN and  SkyNews (no BBC world, which I prefer). The same stuff everywhere. Fuzzy footage of the carnage, so-called experts on the phone with the host, etc. At the same time, I turned to my laptop and logged on to the New York Times. A little better: fresh stories, frequent updates. Same for a couple of French sites. More

The (All Too) Convenient Invisible Hand

Remember Adam Smith, the man who coined The Market’s Invisible Hand phrase, the author of The Wealth of Nations? He gave rise or, rather, a voice to a philosophy of laissez-faire, of as little government intervention as possible.  In his view, the forces in presence, buyers and sellers, producers and consumers would always end up in balance benefiting everyone.  Prices too high? Competitors see an opportunity, customers go elsewhere, prices come down.  Consumers consume less?  Prices come down, demand restarts.  That, in an admittedly simplistic rendition, is what became known as the Invisible Hand keeping things in balance.  But there was/is another idea behind this: Government is inherently dangerous, once it acquires power, it won’t let go, it will oppress the very people its was supposed to serve.  America’s Founding Fathers remembered Pilgrims and their flight from an oppressive king.  And, in the 20th century, Friedrich von Hayek wrote the Road to Serfdom, describing and predicting (the book was written between 1940 and 1943) the ills of centrally planned economies. More

Spécial Etats-Généraux de la Presse Ecrite

(To the usual readers of the Monday Note: this is a special entry compiling notes and links relevant to the consultation held by the French government about the future of the press — hence the French language).

Articles et liens en relation
avec les discussions du groupe “Presse & Internet”

Voici une liste d’articles parus dans la Monday Note, une lettre d’information (gratuite) qui traite des médias dans le monde et de l’évolution de leur business model. Cette sélection a été faite d’après les sujets abordés lors des Etats Généraux de la presse écrite. More

Copyright at the era of digital journalism

Two recent experiences made me pick Copyright as this week’s topic. The first one took place ten days ago at the Monaco Media forum. Professor Lawrence Lessig delivered a compelling presentation covering the evolution of copyright. The second experience happened at a consultation on the future of the press held by the French government where I spoke to one of the working groups. More

Venture Capital in Bad Times

Here, meaning in Silicon Valley, we’re not waiting for Obama – even if we look forward to his injecting physical and psychological stimuli in our economy. A week ago, our President-elect was politely spinning the “there’s only one President” line, meaning he didn’t want to interfere with Bush’s struggle to right the ship.  But, this Saturday, Obama took over, of sorts, the traditional weekly presidential radio address, also carried on YouTube. Full text here.  This is the new régime: 2.5 million jobs to be created, rebuilding the nation’s infrastructure, energy, ecology.  The works, the public works.  There is an obvious message here: the situation is so bad and the Bush administration so lame (as in “lame duck”) that, presidential transition niceties be damned, I, Obama, must grab the bully pulpit – right now.  Congress must get to work on my plan without waiting for my January 2009 Inauguration. This makes good sense as well as good PR, we’ll see if Congress brings itself to follow with effective – and clean, no pork barrel — legislation. More

Not Dead: The Paid-for Online Model

Death reports of paid-for models on the Internet have been greatly exaggerated. Granted: the network’s genome carries the “free” nucleotide.  As in both freedom and free goods and services. Like it or not, its publicly funded origins (universities and the Pentagon) led to the emergence of widely adopted services such as search engines or Wikipedia.  In turn, these have sealed the fate of the paid-for model as the dominant one. Right. I intentionally emphasize dominant. Because like everywhere else, hybrid forms are likely to emerge. More

Defining media moments in The election

What a ride! On December 24, 2007, for the customary but risky New Year prediction game, I wrote: “Barack Hussein Obama will be elected the 44th President of the United Sates of America on November 4, 2008. Why? Because he’s smart, he’s new, he’s clean, he’s authentic and because he is, by any measure, the antidote to the Bush era”… At the time — this was prior the bitter primary season — the outlook was grim. According to a CBS poll, Obama was trailing Hillary Clinton by 27% to 44% in the voting intentions, and only 41% of the registered Democrats considered the Illinois senator experienced enough against 83% who thought Hillary was ready to take the job. And she had the best chance to win the election by 63% versus 14% for Obama. More

What Now?

On November 4th, watching the election results at home in Palo Alto, I’ve seen tears in the eyes of reputedly and professionally cynical French people assembled for the momentous occasion.  We were proud of the country that hosts us and adopts us in its generous melting pot tradition.  Now, we are prouder, even, of its ability to stare at its old demons and to heed, instead, the invocation of its better angels.  One convincing, resounding vote ends eight years of appeal to fear, to mediocrity held up as virtue, of fake religiosity, of destroying liberties at home and lives abroad, of making the Statue of Liberty weep.  All this with a fittingly absurd coda: financial ruin and the socialization of the financial system by rigidly free-market ignoramuses.
So, Barack Obama (see the unusually good) won the 2008 election.  He raised hopes to heights never seen since … I’m not sure when.  I don’t believe JFK rode into the White House on such a combination of despair and hope, of war and recession.  Now, Obama (Barack for “blessed”, if we are to believe dueling Semitic languages) is cursed with winning and having to run the US government, with answering the sky-high expectations his campaign and his person have raised.
Can he deliver?
From a Silicon Valley, VC perspective in my case, there are reasons to see a light at the end of the proverbial tunnel — the light one local wag said George W. Bush had turned off to save energy.  I’ll start with the return of meritocracy vs. the self-defeating, falsely populist mediocracy of the W years. Even the Republican columnist at the NY Times, David Brooks, ended up chastising his fellow conservatives for their low pandering.
In practical, actionable terms, we’re likely to see an overt (and real, let’s not get confused) insistence on science education, high-tech investments in infrastructure, energy and, I’m not holding my breath, high-efficiency vehicles.  Of course, most of us in the Venture Investing biz will have to pay more taxes.  Personally, I want to pay more taxes my way: by making more money, that is by making investments in successful start-ups, that is young companies that sell a lot of their products. And, for this to happen, beyond good products, good entrepreneurs (and visionary but modest investors), we need customers with money to spend on our wonderful innovative products and services, we need a prosperous middle-class.
We tried the trickle-down trick: taking middle-class money to give it to the top 2% of the population. The theory was, you will recall, the 2% would both invest wisely and spend a lot.  As a result, more consumption, more jobs for the middle class. There are no guaranties the new (old, actually) theory will work better. There are plenty of reasons to fear a recession will make the new administration impotent or, worse, that an overly powerful Democrat Congress will keep at its old corrupt games.  Remember, Democrats voted for the catastrophic deregulation of CDS (Collateral Debt Swaps), the most likely trigger, not necessarily powder, for the financial explosion.

No, the real reason to hope was outlined to me at breakfast this last Thursday by an Apple insider. The individual gave money to Obama using the MyBarackObama social network.  Our Monday Note has already sung the praise of what is the most exemplary, most efficient, most grassroots Internet political campaign tool – so far.  What this person told me is the morning after the election, the network was already pinging him, sending him news, calling for action, asking for volunteers to help the Transition now and the new Administration later. Actually, if you want a job in the Obama White House or government, go to change.gov and fill a preliminary application.  I did.  I’m not holding out many hopes of being named Treasury Secretary or Internet Czar, but I’m curious to see what’s going on and if I could help.  Perhaps volunteering as a “good BS” teacher to high-school kids.
Even more seriously, the real point: Obama has built a direct democracy machine second to none.  He’ll have to make real decisions soon.  In plain English: he’ll have to disappoint some people, he’ll have to fight entrenched interests, some very legitimate ones, some richly “lobbied”.  In many cases he’ll have to fight his very own Democrat Congress if he is to perform effective surgery on the tax system and on the country’s spending.  For this, he’s built a network to speak to his supporters over the heads of heavily lobbied, I’m being polite, I won’t write “corrupt” Congress.
Let’s remember: according to Bloomberg, Obama raised the most money, $650M, from more than 3 million Web donors, with smallest average donation, around $200 per person.
I can’t wait to see the Internet Obama machine in action again. –JLG