Three Down, One To Go ...

Well, here we are entering the final quarter of the year. Q3 was a hard fought, hard won quarter in which we managed to bring in the business necessary to keep us on plan for the year, but it was close!

Q4 has a couple of large deals that could put us in a very strong position for the year as a whole but we still have work to do to bring those home and so I won't be jinxing us by saying any more than that for now!

Time, too, to plan for '08, but at this point in the year this is a bit like trying to think about what's for dinner when you are still eating lunch: you know it's coming up, you know you'll be up for it when it arrives but right now there's dessert to take care of and it's all so distant somehow.

The picture? Caption competition! Usual prize: all glory, no fortune.

War Is Hell

Alas, can't include it directly into this posting but take a look at this YouTube offering.

Done that? Right. Things you might conclude from this, and by the numbers:

1. Allah is not Chinese, or if He is then He's not playing for the home-team's arms industry.

2. The power of prayer does not, apparently, extend to precluding weapon malfunctions.

3. If Al Quaeda offers you a job, don't check the box for "Artillery Division" or, for that matter, "Videography".

4. Ballistics 101 must be optional at terrorist school, or at the least these happy-campers missed the bit about laying down a repeatable pattern. Repeat after me, "mortars are not hand-guided weapons."

5. When videoing dangerous military operations, splash out for the really long telephoto lens. Your softer, fleshier parts will thank you later-on.

6. If Iran really is supplying these weapons to Iraqi insurgents then we should do everything we can to encourage the expansion of this trade.

Peace out.

English Eccentrics

Lotus, Eater

Couple of snippets from the Daliy Telegraph I picked up on a BA flight.

In 1776, Augustus Montague Toplady wrote a "batty but oddly compelling article for The Gospel Magazine, in which he compared a rocketing National Debt which could never be paid off, to the extent of human sinfulness." The maths invloved goes something like this: "we sin every second of our sublunary duration", he said, and "our dreadful account stands as follows ... At 10 years old, each of us is chargeable with 315 millions and 720 thousand". Blimey, I may have had a less-than-angelic childhood but no way did I ever clock that tally up. Can't have been trying hard enough. Love the phrase "sublunary duration" though. Have to find a use for that one.

Coming much more up to date and far more down to earth, I noted that John Gardiner just died. He was a well know restorer of rare & classic racing cars; he was also the sort of engineer who would never compromise, and was blessed with the skill and intuition to recreate, from scratch, entire engines just by studying what was left over in some unrecogniseable mess of metallic junk. Apparently, he was contracted by Audi to restore and prepare a pre-war Auto Union. To quote from the Telegraph, "When Audi insisted on manufacturing the V16-cylinder engine crankshaft for these cars, it failed Gardiner's rigorous inspection; and when an Audi committee quibbled endlessly over technical details, Gardiner told them: 'Listen, all you've got to do is to sign the cheques and tell us how big you want the swastikas painted'".

Classic.

Limitless Reach?

Interesting rumour today: Google is looking to acquire Sirius, the satellite radio company, if the propsed merger between Sirius and XM doesn't come off.

Yes, there's the obvious aspect to this, namely providing another channel for the Google-takes-over-world-of-advertising play by allowing them to beam directly into you cars, home and ears even when not logged-on, but it also seems that the satellites that would come along with the deal have other capabilities that they could utilise.

At any given time, there are two Sirius satellites covering the U.S. out of the three that sit in varying elliptical orbits around the earth, and in contrast to XM Radio who went the geo-stationary approach. In addition to hundreds of potential radio channels, these satellites themselves can also stream TV programs and other digital content. However, what I hadn't realised was that they are also set up for two-way communications, pushing and pulling data from terminal devices.

Satellite-based internet access is already available in the US, as pioneered by Hughes, and if you line in an area where it's an option between that or dial-up then even the slow up-link speeds and painful latency times that go with a signal round-trip of 20,000 miles or so suddenly become bearable.

How, then, might Google leverage such a service? The story referenced above indicates that providing an internet connection to your car is definitely one option and doubtless there are many others you could think of too: mobile hand-held device that streams any kind of digital content plus it has an always-on internet connection for free, anyone?

But before we get too seduced by what's possible, let's look at the alternatives. 3G is already active in Europe and APAC providing ample bandwidth for data as well as voice traffic. Cars are already equipped with the means to manage those communications channels and it's only a matter of time before we see the first internet-enabled cars hitting the showrooms. The data rates, responsiveness etc. of those connections would be light years ahead of what the satellite-based approach could offer, with the sole exception of areas that have no cell coverage: an issue in Nevada, for example, less so in places where there are actually people with money to buy shiny new cars every couple of years, which is what's relevant here after all.

Adding it all up, it's a fun rumour and really does highlight the prevailing view that Google can pretty much do anything it damn well pleases right now. Stranger things have indeed happened - just look at the two satellite phone systems launched in the late 90s, Iridium and the other one, for example - and it's undeniable that Google has the financial clout and muscle to do it. However, I'm not convinced and I don't think it's real. But it could be ...

Bull or Bear?

Is it just me or does this feel like we are bumping up against a bit of a financial wall? Oil is sitting at $80 per barrel; the dollar continues to fall; despite taking a breather, the market is not able to keep above 13,500 without getting all wobbly; and now the UAW is out on strike.

While all this dollar weakness this all may be good for US exports, consumer spending still seems to be slowing and the declining housing market continues to add a drag-anchor to the whole domestic economy. Further cuts in interest rates are being talked about - again, and just a week or so after the last one - but take that step and you run the risk not only of sparking inflation but also of sending the dollar into a real tail-spin, further reducing the options available to the Federal Reserve to control things.

Perhaps I'm just tired and feeling a bit low from the travel, Q-end stress etc. Then again ... that may not make me wrong.

Cafe Marcella, Los Gatos

Look, the food was fine, OK? Really. And there was bread, water, everything. I mean, the minestrone I had was a bit bland and frankly it all felt more country than cosmopolitan, but no real complaints about the basics. Everyone else enjoyed all their dishes, and it was a good choice for ourselves plus the in-laws, always a tricky situation to solve for eating out, requiring that we find somewhere that serves good solid food without too much in the way of "fancy fixin's" shall we say. And spices are right out, 'kay?

However, I'm not planning to return. This place was deafening. The ceiling is low and the dining room quite broad, with hard walls and wainscoting. In short, nothing at all to absorb the roar of noise generated by a place packed with happy diners, as in "happy diners on a Friday night with a few bevvies under their belts". Despite the tables being fairly small - actually making things worse because then can then crowd more people in - it was impossible to hold a conversation without literally talking directly into the ear of the person sitting next to you.

Dining out is about much more than the food. The restaurant itself needs to be a place that you want to sit in to eat, otherwise we'd all just order take-out from our favourite chef, a process that would be far cheaper and generally much more convenient than heading down town, trying to park and then not being able to drink because you have to drive home.


If you do decide to go, find a time when it's not packed. Avoid Friday night at 7 pm like the plague, unless you spent all your youthful years at Black Sabbath concerts and hence came into the game half-deaf to begin with. Or you can sign.

Tripping Again

Washing Out

No, not a follow-up to the Drug Bunny post (which had nothing to do with drugs, just in case the DEA has figured blog-searching out), simply pointing out that I'm back on the road again. Off to Stockholm for a few days, home Thursday night. More planes, one train.

Oh, the picture? After this coming week, I'm home for a few days and then leave again to go back to Europe once more. I've still not fully readjusted from the Tokyo trip, and remain short on sleep. By mid October, I'm going to feel like that piece of wood.

Of The Feds, Fat and Foolishness

Oi, You There, Is That Grasshopper Rated For A Bloke As Fat As You?

According to USA Today, and as covered here, a little known byproduct of the "exploding tyres cause SUV wrecks" frenzy a couple of years ago, as brought to you by de-laminating Firestone rubber and the ubiquitous Ford Explorer, was that the Feds decided to invent yet another round of pointless rules and regulations to blight our lives with. Nope, I'm not surprised, either by that response or by the fact that they managed to get it all arse-over-end.

Simply put, they concocted a single formula to define what's a safe carrying weight for any vehicle and what's not, all based on the maximum number of occupants declared by the manufacturer. From 2006, the results of that single calculation are now stamped and stuck onto every new car sold here. Job done. And all with time left over for another round of doughnuts in Washington to celebrate a fine initiative that is clearly making America safer.

Well ... no. Instead, think more along the lines of "pointless government bloat, the sole purpose of which is to make them feel important and to keep the buggers employed" to help guide you back to reality. And even that cynicism might be underplaying things, as we shall see ...

Let's take an example: The Corvette. As American as apple pie and invading countries without the faintest idea of what to do when you win. Even the basic model packs 400 horsepower and 400 lb ft of torque. This thing could tow the space shuttle from California back to Florida and still out-drag your average Camry away from the lights. However, the Fed's formula says that the max. permissible passenger loading for this car is less than 4oo pounds. In other words, a couple of (US) average sized male adults (190 lbs each) alone exceeds that figure, not allowing for the needs of luggage to be carried nor even one of the occupants wearing a particularly heavy tweed that day.

How long, then, before the first law suit is brought in which an insurance company refuses to pay out after an accident by claiming that the records show the car involved was obviously being used unsafely simply because the passengers inside were a bit porkier than average or had the temerity to actually have an overnight bag on board?

Sound far-fetched? Then you don't know the US insurance industry. Loopholes like this are their bread-and-butter, their very lifeblood. Indeed, if you were a real cynic, you might end up concluding that they helped lobby for this rule to be introduced in the first place ....

When To Sell, When to Hold?

Interesting post on why a particular entrepreneur decided to sell for $5m instead of holding out, raising another round and going for it (where "it" might or might not be substituted for by "broke").

Hard to argue either with the maths or with the overall logic. Indeed, the most remarkable thing about Silicon Valley might well be the number of people who have gone down the wrong road, relying on hubris and blind-faith instead of a more reasoned analysis of what their longer-term business options actually are. Of course, selling-out at the first hurdle isn't always the right decision for a business owner, any more than declining to be the 5th Beatle was a good move for Messrs Best, Preston and others when opportunity came-a-knockin'. However, I'd bet a big tranche of company stock on finding that the total number of those who should have sold and didn't is far higher than those who could of and passed.

Regrets like those can last a lifetime.

Health Care Costs

You Get The Analogy, Right?

It seems that no matter how many people complain about it, how complete agreement is that the system is broken or how expensive the whole shooting match becomes, nothing ever changes. Costs continue to outstrip inflation, often growing as much as 15% per year in order just to keep benefits to employees flat.

We're starting to look at trying the new HSA plan going into next year, offering as it does an alternative way of doing the same thing, namely covering employees health needs and contributing to the coverage of dependents. However, I'm sceptical that it will ultimately be much different from what we have today. The theory seems to be that by having employers pay a per-employee deductible amount into a self-managed account and paying less to the health care provider because the deductible on their plan is now that much higher, will somehow reduce the overall costs seen across the whole system. I remain sceptical because, at least in the plan details we've seen, the other shift is that drug costs are fully covered once you get past the deductible amount. Get past that initial deductible amount, therefore, and costs to the emplyee actually drop compared with the present scheme.

In order for this to work out to everyone's benefit, therefore, depends upon a lot of actuarial data showing how employees treat health care provision and what affects the decisions they make about what expenses to take, when. Fair enough, at least historically this may well be a good predictor, but the challenge is that even small changes in the plan can cause unknown - and unexpected - shifts in behaviour, changing the whole premise on whihc this scheme is based.

Prediction time: in two years, these new HSA things will look a lot like the existing plans and any real price or benefit differential will be lost.

Further tackling the demand side is pretty much pointless at this point. Instead, a mechanism is required to better control the often wasteful consumption of health care resources on the supply side, putting doctors back in control of the diagnostic process without operating under the continual fear of being sued. In addition, the ability of drug companies to literally drive consumers into demanding the latest TV-advertised drugs, medically justifiable or not, should be outlawed. Simple changes; big rewards.

But don't hold your breath. Following Hilliary's disastrous attempt at health care reform during the early years of Clinton's reign, politicians of all flavours treat this as a potato(e) too hot to handle. Expect, therefore, platitudes a plenty over the next year, but no action whatsoever.