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The Innovators' Ball

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  • by Mr. Darl McBride (704524) on Friday September 05, 2003 @08:15PM (#6884478)
    'Sharp business is cheating and not getting caught.'

    If I can beg a little impartiality from the Slashdot editors, must every story include a dig at me or my company?

    • by Tony-A (29931) on Friday September 05, 2003 @08:43PM (#6884631)
      Only as long as you're still alive.
  • What? (Score:3, Insightful)

    by SargeZT (609463) <pshanahan@mn.rr.com> on Friday September 05, 2003 @08:22PM (#6884516) Homepage
    Yes, Microsoft is an innovator and I don't think that is good. I'd have to disagree that microsoft is an innovator. What has microsoft done? 1. Created the first OS? Far from it. Not much of an innovation. 2. Created the first GUI? Also not true, the Apple Lisa was the first true GUI. 3. Created easy PnP? Definitley not right, OS/2, Amiga, Linux, and a slew of other OS's had PnP support. And to be fair, Windows 95 wasn't really Plug'n'Play. Microsoft's innovations are limited to trying something someone else does, and hoping it works.
    • Re:What? (Score:5, Informative)

      by Usquebaugh (230216) on Friday September 05, 2003 @08:26PM (#6884538)
      RTFA, invent != innovate
    • Re:What? (Score:5, Insightful)

      by bobdehnhardt (18286) on Friday September 05, 2003 @08:27PM (#6884548)
      From the article, immediately before your excerpt:

      Innovators have wiggle room. They can steal ideas, for example, and pawn them off as their own. That's the intersection of innovation and sharp business.

      Hmmm, steal someone else's ideas and pawn them off as original. Sounds like Microsoft to me!
      • "Hmmm, steal someone else's ideas and pawn them off as original. Sounds like Microsoft to me!"

        If it's as simple as that, then how come the original didn't enjoy success? How did MS edge ahead?
        • Re:What? (Score:3, Interesting)

          by NanoGator (522640)
          "If it's as simple as that, then how come the original didn't enjoy success? How did MS edge ahead?"

          Let it go dude. He's going to bring up the example where Microsoft ripped off some company and was inexplicably popular though the product was inferior. You'll counter with an example of where Microsoft borrowed an idea and actually made it useful to people unlike the company who introduced it. The problem is that Microsoft has released soooooo many products over the years that niether of you will settle
    • Re:What? (Score:3, Insightful)

      by $0.02 (618911)
      If you read the article you will see that the guy wrote that Microsoft did not INVENT any of these things. They were invented by others. That's why MSFT is not an INVENTOR but rather INNOVOVATOR and the author concluded it was not good.
    • Re:What? (Score:2, Insightful)

      by nn5ks (245781)
      Microsoft's innovations probably lie in the just-that-side-of-legal arena.
      I feel it is possible their legal teams have innovated all over the place.
    • Re:What? (Score:4, Informative)

      by adrianbaugh (696007) on Friday September 05, 2003 @08:32PM (#6884575) Homepage Journal
      I think you and Cringeley are making the same point. M$ has just repackaged and changed these ideas in a way they can profit from but which doesn't necessarily add much value. Cringeley is suggesting that had they created the first operating system it would have been an "invention", rather than an "innovation", which he regards as smaller and generally less worthwhile/reputable. Semantics, I know, but I think the two of you are coming from the same place on this one.
      • Re:What? (Score:3, Interesting)

        by NanoGator (522640)
        "I think you and Cringeley are making the same point. M$ has just repackaged and changed these ideas in a way they can profit from but which doesn't necessarily add much value."

        If that were true, Windows 95 would have been long forgotten in 1996. Obviously there was some value there. Otherwise, we'd all be using Macs.
    • Re:What? (Score:5, Funny)

      by jspoon (585173) on Friday September 05, 2003 @08:56PM (#6884685)
      I'm not completely sure, but I think they created that stupid paperclip thingy in Word. At least I've never seen anyone else take credit for it.
      • Re:What? (Score:5, Interesting)

        by alext (29323) on Friday September 05, 2003 @09:45PM (#6884905)
        Actually, there's some substance to that.

        I understand that, at the time Clippy emerged, he was the only development that had its origins in Microsoft Research, something which they were mighty embarrassed by (and which was not really their fault).
        • Re:What? (Score:3, Informative)

          Did you know Clippy has a voice? Do you think it is a pleasant voice or an annoying stupid celebraty grate-in-the ears voice?

          Go here [microsoft.com] to find out.

          Really, did you think it would be anybody else?
        • "I understand that, at the time Clippy emerged, he was the only development that had its origins in Microsoft Research, something which they were mighty embarrassed by (and which was not really their fault)."

          I don't understand what you mean by "not really their fault". Did Clippy write himself?
          • by alext (29323)
            I think they were hinting that whatever MS Research had produced was mauled by MS product development. Still MS's fault, but like any large organization, it's not a monolith.
    • by King_TJ (85913) on Friday September 05, 2003 @08:58PM (#6884695) Journal
      The way I see it, it all comes down to one question... How "absolute" is the statement?

      When a person claims to have "invented" something, it's pretty clear cut. The statement says they came up with a new idea and put that idea into practice. I don't think it's very often that you find a claim of an invention that a large number of people feel "uncertain" about.

      When Edison claimed he invented the phonograph or the light bulb, it wasn't a matter of personal opinion. It was fact. Those two devices simply weren't around before then.

      Innovation is a matter of opinion. One person's "innovative new way of displaying menu options" in software is another person's "terrible GUI design that should never have been attempted".

      Is Microsoft innovative? Perhaps so, and perhaps not. It all depends on which side of the proverbial fence you stand on. (If you're one of their programmers and you're watching you own ideas become reality in new software releases, you're probably on the side that says "Yep, we're innovating!") Are they inventive though? Certainly not! You don't have to look far to see how many of their products contain code purchased outright from others. Even the pinball game included with every copy of Windows since '98 was licensed from Maxis.

      Really, I don't think many companies are "inventive" at all anymore - and that's one of our problems. These days, there's more interest in litigation than invention - because it has a higher probability of profit/success.
      • I don't think it's very often that you find a claim of an invention that a large number of people feel "uncertain" about.

        On the contrary, many major inventions are hotly disputed. Usually they were invented independently by several people around the same time. For example, Alexander Bell and Elisha Gray invented the telephone concurrently. Bell won the legal battle.
    • Re:What? (Score:3, Insightful)

      by dave420 (699308)
      It was the first company to put *all* of those in the same operating system. To be fair, Linux hasn't even got a GUI half as nice as Windows. Fair enough, the later redhats have good PnP, but earlier versions were a nightmare.

      Don't get me wrong, I'm not anti-linux (on the contrary). I just think we need to admit linux's shortcomings and do something about them, instead of defending the obvious flaws as happens so much. Otherwise, microsoft's market share won't be dented.

      • Re:What? (Score:2, Informative)

        by IM6100 (692796)
        Fair enough, the later redhats have good PnP, but earlier versions were a nightmare.

        The first version of Linux I ever ran, and actually the first version of Linux released commercially on CD-ROM was Yggdrasil, which billed itself as 'Plug and Play Linux.'

        I booted it up in late 1993 on my 486 computer, which had a Sound Blaster Pro sound card and a 1x CD-ROM drive that plugged into the Sound Blaster pro card.

        It played a complex melody (an .au file) at the login prompt, when you booted it to the CD-ROM ba
    • " 1. Created the first OS? Far from it. Not much of an innovation. 2. Created the first GUI? Also not true, the Apple Lisa was the first true"

      Microsoft has never made this claim. What they did do, though, was combine a GUI with off the shelf hardware and make an OS that a wider market of people can use. Sort of like what Apple did, only you didn't need to buy AppleTM hardware.

      "Microsoft's innovations are limited to trying something someone else does, and hoping it works."

      Close. Microsoft made it wo
      • Microsoft made it work, or at least made it work 'satisfactorally'. Windows 95 was painful to use in many ways, but it was still much much better than dos. You can't credit another OS with fulfilling that on PC hardware until Linux came along.

        Sure you can. OS/2 was vastly superior to Windows 95 in numerous ways. Microsoft backstabbed IBM, and then outmarketed them, but 95 was nowhere near the OS that OS/2 was.

    • Re:What? (Score:3, Insightful)

      by NanoGator (522640)

      "Yes, Microsoft is an innovator and I don't think that is good. I'd have to disagree that microsoft is an innovator. What has microsoft done? 1. Created the first OS? Far from it. Not much of an innovation. 2. Created the first GUI? Also not true, the Apple Lisa was the first true GUI. 3. Created easy PnP? Definitley not right, OS/2, Amiga, Linux, and a slew of other OS's had PnP support. And to be fair, Windows 95 wasn't really Plug'n'Play. Microsoft's innovations are limited to trying something someone e

    • by tjstork (137384) <todd,bandrowsky&gmail,com> on Friday September 05, 2003 @09:16PM (#6884786) Homepage Journal

      The point of the article was that innovation was a corporate metaphor for playing politics, cheating and stealing, and invention was just invention. He said that Microsoft was an innovator, not an inventor.
    • Re:What? (Score:2, Informative)

      by qmrq (648586)
      Also not true, the Apple Lisa was the first true GUI.


      The first GUI was developed in 1979 at Xerox's Palo Alto lab, unless I'm mistaken.

      Steve Jobs traded something like one million US$ for a tour of the labs where he first encountered the "Alto", a prototype machine with a graphical interface. This is what led to the Apple Lisa, which was released in 1983 or 1984, if memory serves.

    • Re:What? (Score:4, Interesting)

      by Eric Smith (4379) * <<moc.ahahuorb> <ta> <cire>> on Friday September 05, 2003 @09:47PM (#6884919) Homepage Journal
      Created the first GUI? Also not true,
      AFAIK, M$ has not claimed that.
      the Apple Lisa was the first true GUI.
      I beg to differ. Xerox had several things that were "true" GUIs before Apple started down that path. In fact, it's well documented that Apple decided to develop a GUI inteface after being given a demonstration at Xerox PARC (in exchange for Apple stock). Apple licensed Smalltalk-80 (which was GUI-based) and had it running on 68000-based hardware well before the Lisa's native OS and GUI. Apple's port of Smalltalk-80 was never released as a product, though a version ported to the Macintosh OS was released to developers through APDA.
      • Apple's port of Smalltalk-80 actually does still exist and lives on as Squeak [squeak.org]. Alan Kay and his team took Apple Smalltalk and essentially modified and rewrote bits of it until it was released in I believe 1995 or so to the public as Squeak. It is available under a relatively open license, and runs under a large range of platforms. I highly recommend it if you are looking for a high-quality, free, open-source Smalltalk implementation.
    • Re:What? (Score:2, Insightful)

      by IM6100 (692796)
      2. Created the first GUI? Also not true, the Apple Lisa was the first true GUI.

      Depends on your use of the term 'true.' The pioneering GUI development that preceeded the Lisa was significant. The first prototype 'mouse' was developed in the middle of the 1960's, for goodness sake.

      And the Lisa was a dismal failure in the market. I remember about 1990 when they sat mute in used computer shops and we could say in wonderment 'ten thousand bucks.'

      The IBM 5100 was only about ten grand, and it was a hell of
    • Yes, but I think the point of the article was that they do innovate in their own way, but not the way that you might think. That's why it may not be a good thing.
  • Very true (Score:5, Insightful)

    by adrianbaugh (696007) on Friday September 05, 2003 @08:24PM (#6884530) Homepage Journal
    It's not just the few like Enron that get onto the front pages, it's all the other businesses that it never quite seems to be worth anyone's while to bust (but damn well should be!) There are several extremely obvious examples in IT (cough*MS*cough*SCO*cough), to the extent that reading /. or any of the techy press it's hard not to see most of the industry as riddled with corruption, and I'm sure the same is true in other areas of business.

    The thing is, I bet there are a lot of cases where one or two bad guys not necessarily right at the top can turn a whole company crooked (or at least semi-crooked) just because everyone else is too apathetic - or frightened - to shop them.

    Of course, when the crooks really are at the top then it really sucks.
    • by cshark (673578) on Friday September 05, 2003 @11:44PM (#6885421)
      I actually e-mailed bob about this article. My big question was, Can sharp business practices and actual innovation co-exist in the same place, at the same time? This time, Bob Cringely was actually kind enough to respond. Below is the actual unedited text of the message I recieved.


      It all comes down to what you consider to be the reason the company is in
      business. Is it to benefit the owners, the managers, the employees, the
      customers, or the community in which the business resides? While there can
      be more than one reason, one of those reasons must be larger than the
      others.

      Public companies are supposed to benefit their owners though we've seen a
      lot of stockholders burned lately by companies where the managers seemed to
      come out on top. Great companies are supposed to put customers first, but
      will they do so at the expense of profits? And community, whether it means
      my town, my country, or the environment, is usually last of all.

      I have no answers, only questions.

      All the best,

      Bob

    • Re:Very true (Score:3, Insightful)

      by goliard (46585)

      The thing is, I bet there are a lot of cases where one or two bad guys not necessarily right at the top can turn a whole company crooked (or at least semi-crooked) just because everyone else is too apathetic - or frightened - to shop them.

      Ignorant. Too ignorant or oblivious to even notice they are being screwed until it is too late.

      The case that Cringley describes, the founder of the Corp got ousted through boardroom manuevering. Do you think he would have seen that coming in a million years? If

  • by aacool (700143) <aamanlamba2gmail.com> on Friday September 05, 2003 @08:25PM (#6884533) Journal
    And how is it different from what we might have said before? I think the word they are replacing is "invention." Bill Shockley invented the transistor, Gordon Moore and Bob Noyce invented the integrated circuit, Ted Hof invented the microprocessor. (Cringley's article) [pbs.org]

    Most inventions were based on some innovation or the other - the IC was an innovative usage of the transistor, the microwave an innovative usage of UV, etc.

    As Newton opined "If I have seen further, it is because I was standing on the shoulders of giants" I've created/invented software that I'm proud of and others might term innovation - what's so wrong with innovation anyway?

    • Innovation is the act of INTRODUCING something new, not creating something new. All thing are based on other things.
    • by gnuadam (612852) * on Friday September 05, 2003 @08:47PM (#6884648) Journal

      Microwaves don't use UV. They, uh, use microwaves. :)

    • microwave an innovative usage of UV

      Call yourself a geek. You don't even know how a microwave works. I bet you use WinXP and use StyleXP to make it look like Linux.

    • However, when you look at it in the other direction, not all innovations are related to inventions, as an invention would be an object of some form or another, and well, software, for one, is not an object.

      Now, something that's hardware, that uses software or firmware might qualify as an invention. But when we start getting to 'innovative business practices' or 'innovative billing techniques' or 'innovative ways to force your competitors out of business', there's no particular object, and hence no inventi
  • MS "innovation" (Score:5, Insightful)

    by doodleboy (263186) on Friday September 05, 2003 @08:26PM (#6884541)
    I thought this bit was spot on...
    But there is another issue here, one that is hardly ever mentioned and that's the coining of the term "innovation." This word, which was hardly used at all until two or three years ago, feels to me like a propaganda campaign and a successful one at that, dominating discussion in the computer industry. I think Microsoft did this intentionally, for they are the ones who seem to continually use the word. But what does it mean? And how is it different from what we might have said before? I think the word they are replacing is "invention." Bill Shockley invented the transistor, Gordon Moore and Bob Noyce invented the integrated circuit, Ted Hof invented the microprocessor. Of course others claimed to have done those same three things, but the goal was always invention. Only now we innovate, which is deliberately vague but seems to stop somewhere short of invention. Innovators have wiggle room. They can steal ideas, for example, and pawn them off as their own. That's the intersection of innovation and sharp business.
    Propaganda is the idea that saying the word makes it true, that it somehow undoes the corporate culture of law-breaking and dirty tricks. But it only works with the uninformed - people who understand the issues and the history know they're full of shit.
    • Re:MS "innovation" (Score:5, Insightful)

      by DrCode (95839) on Friday September 05, 2003 @08:33PM (#6884586)
      I felt the same way about 6 years ago when I started seeing the term "technology" associated with software, as in "Microsoft Technology" or "Wizard Technology".
    • Re:MS "innovation" (Score:4, Interesting)

      by NanoGator (522640) on Friday September 05, 2003 @09:21PM (#6884806) Homepage Journal
      "They can steal ideas, for example, and pawn them off as their own."

      Steal? Bit harsh, don't you think? An idea's only as good as its implementation. If the original idea needed to be tweaked to have a bigger appeal, then the general populous benefits from that.

      I agree that credit should be given where credit is due. However, it's nowhere near as black and white as this article implies. The Newton was around long before Palm Pilot, yet Palm gets the credit for making it mass market. "It is inferior to the Newton!" the zealots cried. But the Palm Pilot had some distinguishing features. It was pocket-sized, it talked to your PC and got relevant info out of it, and it was direct and to the point.

      Apple gets some credit for generating the idea, Palm gets the credit for taking it and making it useful. Innovative? I think so.
      • Re:MS "innovation" (Score:3, Insightful)

        by sjames (1099)

        Of course, The Newton is predated as well. Rat Shack had the 'Pocket Computer' whose primary fault was that it came out before the state of technology could really support the idea. Prior to that, several Science Fiction writers actually anticipated the real devices by many years. In turn, they realized the possability only because computers in some form existed, so they owe their ideas to the long line of people responsable for that.

        Each step along the way was an improvement for the potential end users,

    • Re:MS "innovation" (Score:3, Interesting)

      by Tony-A (29931)
      Propaganda is the idea that saying the word [and repeating it] makes it true.
      There is also the BIG LIE, which is so preposterous that it leaves your opponents speachless.

      innovation. sounds impressive, but:
      innovation n. Act of introducing something new or novel as in customs, rites, etc.
      A different color of mouse-pad is innovative. Getting slashes backwards is innovative. Standing when you should be kneeling is innovative. The latest teenage fad is innovative.
      There is no sense of improvement or invention or
    • by twitter (104583) on Saturday September 06, 2003 @07:24AM (#6886505) Homepage Journal
      Propaganda is the idea that saying the word makes it true, that it somehow undoes the corporate culture of law-breaking and dirty tricks. But it only works with the uninformed - people who understand the issues and the history know they're full of shit.

      This is very true, believing something does not make it true, ignoring it does not make it go away, and fighting is never futile. If only Cringerly had the guts to fight for his convictions we'd be better off. Cringerly is wrong when he proclaims:

      My readers, ... are many of them still debating in their minds whether software can even be patented. Whether it can be patented or not, in the U.S., it IS patented, and expecting that some contrary decision will be shortly made and the planets rearranged in space is just folly. This is the difference between cynicism and realism.

      How bizzare for Cringerly to understand how M$ works and then recomend resignation. Software is pantented because asswipe companies like M$ made enough people believe that it was good. The only way to reverse this is to continue to understand and tell other why it's bad. How can someone understand that patent and copyright abuse are the means by which inventors are screwed by "innovators" or "sharp business", and not fight such abuse? Propaganda can and is defeated by reality. Understanding that something is wrong and not speaking out or acting is not "realism" or "cynicism" it's cowardice. Shame on you, Mr. Cringerly, for understanding the problem, anouncing it, resigning yourself to suffer and recomending for others to do the same. Knowledge, conviction and an audience have the power to change.

      When laws are bad and permit immoral beahvior, people suffer regardless of how happy you tell them they are. Reasonable laws leave people free to act as they will, so long as they don't harm others. Unreasonable laws block the actions of others for the benefit of a few who seek such "protection". Restrictions are something people understand and feel, even when the activity restricted is something they don't ordinarily do.

  • Nothing New (Score:5, Insightful)

    by Mrs. Grundy (680212) on Friday September 05, 2003 @08:26PM (#6884543) Homepage
    Sharp business is cheating and not getting caught.

    No. Sharp business is 'cheating' while following the letter of the law. What he is describing is 'Sharp Criminal Conduct' which some business people and many politicians engage in. When the politicians engage in 'Sharp Criminal Conduct' they make it easier for those engaging in 'sharp business' to do really foul things without actually breaking any laws. It's a subtle, but important difference and worth remembering next time you vote.

  • decent (Score:5, Funny)

    by randyest (589159) on Friday September 05, 2003 @08:28PM (#6884549) Homepage
    Decent article, but regarding this part:

    We've gone from following the rules to playing the odds.

    And if we do follow the rules and don't play the odds, then we are figured to be suckers.

    Speak for yourself. Some of us just keep doing the right thing as best we can, no matter what everyone else is doing. We usually come out better in the long run.
    • Re:decent (Score:4, Insightful)

      by evilviper (135110) on Friday September 05, 2003 @08:32PM (#6884577) Journal
      You may come out fine, but as he said, you are figured to be a sucker.

    • but you are stilled figured as a sucker.
      there is a difference.
    • Some of us just keep doing the right thing as best we can, no matter what everyone else is doing. We usually come out better in the long run.

      Either we come out ahead, or we wind up dead as the ultimate punishment for trying.

      But, it is better to die a noble death in defense of liberty and justice than to prostitute one's morals before the tyrants of the day.

      Eventualy some of us will come out ahead and perhaps they might remember our sacrifices for our common goal.

  • by shri (17709) <shriramcNO@SPAMgmail.com> on Friday September 05, 2003 @08:36PM (#6884597) Homepage
    Read the article and started to wonder if Cringley was having a bad day. For every business he's mentioned, there are several who are doing well and doing it cleanly.

    Companies like Google, Berthshire Hathaway and others come to mind as good counter examples of what Cringley calls "gone from following the rules to playing the odds".

    A sligh positive note in that article would have helped. Oh well .. just an observation.
  • News flash! (Score:2, Redundant)

    by EdgeShadow (665410)
    This just in... our sources have just informed us that there are business executives out there who lie, cheat, and even steal! I'll take this oppurtunity to warn all decent folk out there to think twice when making dealings with such evil, evil men.

    Seriously though, since when is the common practice of "savvy businessmen" screwing trusting people out of money news?
  • by imhotep1 (674470) <imhotep1@@@rcn...com> on Friday September 05, 2003 @08:37PM (#6884601)
    My father is a very moral man, who taught me early on that winning isn't the point in life. In fact, if "winning" is your only goal, you will never win.

    He would tell me stories, like the time he quit his high school water polo team after the coach encouraged his team to elbow the opposing team whenever the ref looked away.

    My father's tech company was stolen away from him in the same way as in this artical. He and several friends created a start up, and within a few years, all were shut out of the company, and the investors walked away with the prefered stock.

    Companies like Microsoft practice an odd form of amorality and defend it as good business practice. It might be sound business practice, but there is nothing good about it.

    Admittedly, in any capitalist society there is a dog-eat-dog quality to business, but is there really the need to specifically crush upstart companies, play fast and loose with public standards to kill competition, and other such underhanded techniques that are only good for your company, but bad for everyone else.

    In the end, I think most people who were raised with a firm and grounded set of morals appriciate that there is such a thing as good business practices. I try my best to stay abrest of those companies that follow them and only give them my business. It's hard sometimes, but in the end, it might be the only way some businesses can be made to behave.
    • He and several friends created a start up, and within a few years, all were shut out of the company, and the investors walked away with the prefered stock.

      This is called liquidation preference and is part of any serious startup financing. The deal is that regardless of whether the company succeeds, when it is ultimately sold, the guys who put in the money (for preferred stock) get their money out first. Then the common shareholders (founders' sweat equity, employee stock options, warrants etc) together wi
    • You or your father might find this book interesting: Honest Business: A Superior Strategy for Starting and Managing Your Own Business [amazon.com]by Michael Phillips, Salli Rasberry (Contributor), Peter Turner (Editor).

      Treasure your time together.

    • "like the time he quit his high school water polo team after the coach encouraged his team to elbow the opposing team whenever the ref looked away"

      Um, I suppose the really moral stance would be to object to that, but I think your dad made the right decision: water polo is generally not played by people whos morals are that stringent.

      My wife played co-ed water polo in college. I try not too piss her off in the water. She can tread water with a big smile on her face while pulling out your leg hair with h
  • innovation ( P ) Pronunciation Key (n-vshn)
    n.

    1. The act of introducing something new.
    2. Something newly introduced.
    • Re:innovation (Score:5, Interesting)

      by SirSlud (67381) on Friday September 05, 2003 @08:46PM (#6884643) Homepage
      What's happened is that the implementor (Joe Shmoe, lets say) has been confused with the inventor.

      Few people invent radically new devices. As the cliche goes, the cell phone was invented in 1954, and yet putting a camera on a cellphone, two existing inventions together is called 'innovation'. Yeah, a cell phone with a camera was something new, but so was the first zipper painted blue! Lots of things are 'new', but only because they are simply the result of the millions of ways of combining all the technology we have. Something *truely* new, not just a recombination of things that have already existed, or an existing technology in a different shape, size, color, etc, comes along far less often than the patent office records or brochure claims of corperations will have you believe.
  • Exactly (Score:5, Insightful)

    by SirSlud (67381) on Friday September 05, 2003 @08:40PM (#6884620) Homepage
    My term is 'gaming the system'. When you exploit loopholes and bend rules, you defeat the purpose and intent of a system, thus ensuring that even if you believe the system in theory should work as intended, it won't.

    Some people assume if you end up with the desired goal of the system (wealth), than it has served its purpose. In reality, the system was devised not so an individual can become rich, but rather so we have a set of rules in which to facilitate improving our standard of living without resorting to social friction and unfair (subjective, I realize) treatment of others.

    All the market tactics, advertising ploys, and accounting/legalese rule bendings seem to weaken the role of merit in capitalism. And I know what constitutes 'merit' is subjective, but I'd rather not give merit to those creative and smart enough to figure out how to bend rules in their favour without being caught.
    • ...."And the result is that we all become cynics."

      Welcome to the harsh world of reality. Do or Die.

      --

      How do you build wealth?

      By making more money than you spend?

      How do you do that?

      By only spending what you are absolutely required to spend and not a dollar more.

      How do you do better than that?

      By finding ways to spend less than your you are required to spend
      • Welcome to the harsh world of reality. Do or Die.


        And with that attitude, the caveat emptor attitude, the pundits wonder why people aren't investing in the market.

        Banks in the Western US had a similar problem in the latter half of the 19th century. People would put their money in, then someone would come along and rob them.

        So banks could not attract the capital that would be necessary to fund the economic expansion that everyone was waiting for.

        So the government established the FDIC. And that made ba
  • by Fnkmaster (89084) on Friday September 05, 2003 @08:49PM (#6884659)
    I feel bad for the entrepreneur who got screwed in Cringely's story, but you have to always doubt and distrust ANYBODY that is sent your way by your investors. They will almost surely have a conflict of interest. The trick described (emptying a board seat and keeping it empty to enable the lead investor(s) to rule the board without challenge), or just structuring the board so that common-shareholders-be-damned aren't uncommon techniques that venture capitalists use. And all those "outside" managers they want to bring in - here's a hint, these people are often people they go to church with, or whose kids go to daycamp with their kids, or who are on the town council with them.... in short, they are going to scratch each other's backs whenever possible.


    My recommendation is to raise money from people who already know or trust to some degree whenever possible, and ALWAYS, I repeat, ALWAYS, worry about control. Control is often times far more important than who has how many shares. Shares can very often end up worthless at the end of life of a business venture, if it is liquidated, or M&Aed away, or basically has any end-game other than an IPO, unless your shares are all on a level basis (this is a nice thing about flat LLC memberships and S Corporations as business entities, though that's certainly not necessary).


    Just remember that you have to make sure that all your contracts and legal structure reinforce your power and control, and it's often better to give up some extra equity in exchange for this. Be careful who you trust. And never make yourself unnecessary before you have your exit strategy well on its way to execution.

    • Very good points. And you can just as easily get screwed in business by "friends" who decide the buck is more important than your friendship as you can by the VC vultures and their pods. I'm too cowardly to have even tried to start a business, but a friend of mine could tell some really nasty stories about the time his "friends" tried to screw him out of his share of the company (this one had a happy ending, but only after years of legal wrangling).
  • not really new (Score:5, Interesting)

    by Trepidity (597) <delirium-slashdot&hackish,org> on Friday September 05, 2003 @08:50PM (#6884665)
    In the US at least, shady inventors have a long tradition dating back to Thomas Edison, whose patent trickery and idea-stealing is somewhat legendary (he even invented the electric chair to make the competing A/C current look dangerous).
  • obligatory mockery (Score:5, Insightful)

    by Anonymous Coward on Friday September 05, 2003 @08:59PM (#6884707)
    Now this is a bit ridiculous. Business is a game where the winners turn a profit- which is to say, sell things for more than they are "worth," where "worth" is what these things actually cost to produce. Thus, business is not nice and never has been- hence Jesus with the money-changers, prohibition against usury, Medieval Jewish banking, anti-semitism, Shakespeare, Dickens, Marx, Steinbeck... the list goes on, defining massive areas of history, especially in the Christian world.

    Cringely wants no part of that sleaze. He's a geek and a PBS writer instead.

    For a while, it looked like people could be geeky and ethical while still turning a profit. This was a temporary illusion caused by a populace that had a religious awe of geeks, caused mostly by FUD, and was willing to overpay even those geeks who didn't really turn the screws. The middle managers who forked over millions of dollars (which THEY had scammed from others) for their own electronic replacements were not making headlines during the late nineties, but there were more of them than there were techie nouveau riche.

    So. Every geek, and indeed every human, must ask him or herself whether to try to profit by bringing misfortune to others, or whether to embrace poverty, in the unlikely hopes that that will make the world a better place. I don't have an answer to that for myself, let alone for everybody, but claiming that the sky is falling just because the tech bubble burst months ago is worthy only of ridicule. It is good for anyone, even slashdotters, to be reminded of these Big Questions; but all in all, I think Cringely and most of the rest of this crowd are in way over their heads.

    Will Warner geocities.com/wtw0308
    • by smack_attack (171144) on Friday September 05, 2003 @09:22PM (#6884812) Homepage
      Geeks were easily corruptible, as with most people in this era of instant gratification.

      I would reccommend reading Dostoevsky's The Idiot [amazon.com] for some enlightenment on how the world treats those who act morally and conscientiously in regards to life and business.
    • "Every geek, and indeed every human, must ask him or herself whether to try to profit by bringing misfortune to others..."

      Um...

      Why is harming others necessary for profit?
    • by LrdHlmt (560099)
      profit by bringing misfortune to others, or whether to embrace poverty This is a white and black simplistic aproach. I see the point you are trying to make though. There's nothing wrong with making a profit, as long as your are not lying, cheating or stealing. Anyone can make a decent buck without crushing people or companies. Now, getting greedy is another thing (a capital sin in christian terms). when does anyone have enough money?. As a matter of fact one good invention or innovation can bring fortune
    • I wouldn't even call Cringely a 'geek'. He's a half-journalst half-geek who is just the one who decided to commercialize the 'Robert X. Cringely' moniker that a number of journalists shared in influencial tech columns of the past. His most accurate label would be 'opportunist' but then, anybody whose column header on a website sandwiches his face between Jobs and Gates (even though his head would be too small to even see if scaled correctly in reference to the other two).... well....

      He's a hack writer.
  • Webster's Revised Unabridged Dictionary (1913)
    Innovate \In"no*vate\, v. i.
    • To introduce novelties or changes; -- sometimes with in or on. --Bacon.

    • Every man,therefore,is not fit to innovate. --Dryden.

    WordNet (r) 1.7 [wn]
    innovate

    • v : bring something new to an environment; "A new word processor was introduced" [syn: introduce]

    So, Microsoft is proud of introducing changes (often created by others?), as opposed to inventing anything of their own.
    Now, that makes

  • by mc6809e (214243) on Friday September 05, 2003 @09:21PM (#6884807)
    I maybe stretching things, but I think part of the problem is with collective decision making itself. We tend to think that if everything is done democratically, we'll get the best results. So when a company is divided up amoung shareholders, as long as they get to vote, or have representatives to vote for them, we expect things to work out fine.

    Unfortunately, it's been proven, under a few resonable assumptions, that there exists no fair voting system. This was proven by the economist Kenneth Arrow who won the Nobel prize for his work. A short discussion is here. [vill.edu]

    So what ever system of democratic decision-making you might create, it has fundamental weaknesses that are exploitable by the unscrupulous.

    The only way to stay out of trouble is to find other ways of raising capital.

  • nothing beats the happy fun ball [happyfunball.com]
    mirror... [neu.edu]
  • Cringley builds the foundation of his entire article on a person who got screwed and was left with nothing. Yet, there is no attribution. It would seem to me this is a person who would want light shone on his plight and the evil doers who did him in.
    By not providing attribution, Cringley deprives us of getting both sides of the story. That's why many news organizations frown on anonymous sources except when absolutely necessary.
    I realized a long time ago that no one I ever knew who was involved in a
    • Yes, I was thinking the same thing as I was reading it. But mentioning this person's name could expose him to some liability we can't foresee.

      But in a sense it's not necessary, as it has a ring of truth to it, and there have been similar stories in the news about original company owners losing control of their companies.

      It's a small nitpick to a rather insightful article about "sharp business" and "corporate morality". I have had these very same ruminations for quite some time, and Cringley put words to t
  • It isn't fun (Score:5, Insightful)

    by cubicledrone (681598) on Friday September 05, 2003 @09:39PM (#6884876)
    Business isn't fun for inventors and creative people because it is impossible for a creative person to bring an idea to production within a bureaucracy.

    This is because we allow office politics to completely absorb every single moment of every single day in "corporate" businesses.

    There is absolutely no concern for a quality product or a truthful discussion of the right and wrong ways to build something in the cubicles. It's who can fuck who over so they can keep their job while simultaneously destroying someone else's career. It's who can point out the most failures. It's who can foster the most suspicion and doubt about their colleagues' competency that succeeds in the never-ending schedule of meetings.

    And nobody ever talks about it. Nobody ever squarely points out the enormous amount of time and money that is wasted, man-hour to man-hour, by people building spectacular layers of redundancy to cover every possible and several impossible failure possibilities while attempting to answer the unanswerable questions posed by middle management.

    These are the same people by the way, who insist on everyone being a "team player." Of course, that only applies when these people are the quarterback, not the left tackle.

    Want to know where the largest source of waste in business is today? This is it: office politics. People working against each other instead of working as part of a team which actively encourages people to grow and succeed. It's a disgrace and it shouldn't be allowed to continue.
  • Coup de Jarnac (Score:4, Interesting)

    by pgpckt (312866) on Friday September 05, 2003 @09:40PM (#6884887) Homepage Journal
    "But sharp business is something different, it is playing the game of business so close to the boundary of good faith and legality that it is hard to tell where that boundary is or if there even is such a boundary. "

    This is also sometimes refered to as a Coup de Jarnac. Jarnac won a dual against Francois de Vivonne in 1547. Jarnac got to pick the weapon, and instead of one, he picked several fo that Francois wouldn't know which one. Jarnac also knew that Francois was famous for a particular move when he fought that would expose his hamstring. So, Jarnac just played the dual to a draw until Francois exposed himself, and then he cut his hamstrings and Francois bled to death.

    While technically within the rules, it was considered dirty, and hense Coup de Jarnac is a term that can be used to describe this.

    So ends your history lesson for today.
  • If you knew the stuff they actually do and have done, your head would probably explode. I'm serious, literally explode. Like a small mellon or something in the hands of Gallagher [gallaghersmash.com].

    Yes, I'm quite positive. The only way to get something done is to have 4000 of your customers call the PUC (hey, it beats them bitching at you! Customers love to hate SBC and techies love to pass the buck). Then maybe they'll "look into it."

    Like a large, ripe berry.
    "Wait, you mean they actually...*kaboom!*"
  • Cringley wrote "When did we fall so low?" He should ask, "why haven't we been able to climb higher?"
  • by Machina70 (700076) on Friday September 05, 2003 @10:12PM (#6885005)
    This is the modern buisiness environment.

    If you're a programmer, engineer, or even a doctor, you're just worker. You don't matter except as an "overhead" figure.

    The people that do matter don't actually produce anything, the lawyers and the CEO's, they try to see how little they can pay the "overhead" while still meeting various buisiness benchmarks(production, PE ratios, etc). Then they give the lionshare of profit to ... themselves.

    They enroll employee's in HMO's that are cheap so they can give that money as bonus to themselves for increasing the company's profits .
    They play fast and loose with the company savings funds and give themselves a share of that for being "innovative".
    Even if it bankrupts the saving fund. The bonus still stands.

    More and more the american worker is just dirt that's tilled for whatever it can produce. And it's given the same consideration as dirt. Buisiness leaders paint Unions as greedy for wanting raises that keep pace with inflation, health care benefits that can be actually used, and decent working conditions.
    All while these same leaders tear the buisiness apart trying to squeeze everything they can personally take from it.(how many times do we see the CEO that led a company into Chapter 11 getting million dollar bonuses or golden parachutes as a reward for their sterling effort)

    And they've made the laws and rules dealing with buisiness so convoluted that only someone who's never learned ANYTHING but buisiness can hope not to be screwed. There's nothing corporations love more than screwing over the neophyte who thinks just because they created something they should make money from it. (this story, Spiderman the movie, Forrest Gump)

    Why does this happen? Because big buisiness makes all the rules, if the rules say they can't win, they have them changed. Or they just ignore them and "settle" if it goes bad, with a mandatory non-disclosure agreement of course.

    MPAA, RIAA are on a war against illegal profitless file trading. Why is it illegal? Because they had the laws changed to MAKE it illegal. We sit through sanctimonius ads about "doing the right thing" and respecting the artists, the actors, and the industry workers.
    While at the same time those corporations "settle without admitting wrong doing" illegal price fixing on music CD's, and they're telling the creator of Spiderman and the writor of Forrest Gump that the movies didn't make a profit so they, the creators, get NOTHING.

    But they insist everyone else be ethical about respecting IP laws that THEY wrote.

  • Wake up suckers (Score:2, Interesting)

    by dbc001 (541033)
    This is how America works these days! It's not about whether or not it's legal, it's whether or not someone will press charges/sue/etc. EULA is oppressive, rude, annoying, and possibly illegal? That doesnt matter until it gets to court. DMCA is bad and unconstitutional? Even though lawmakers know this, it still has to be proven in court.

    I worked for a debt collection company for a while. They would threaten and harass and threaten more, but they would never take a case to court unless 1) the perso
  • by Anonvmous Coward (589068) on Friday September 05, 2003 @11:05PM (#6885249)
    ... because I don't think I would have clicked on an article called "The Innovator's Balls".
  • The type of behavior described is over the long term self correcting. Yes you have people that have decided to gain an undeserved advantage by whatever means neccesesary, but by winning through such means they either so their destruction or the destruction of the society that harbors them.

    There are many examples occuring in the wider world right now. Terrorists don't spontaneously generate. What is sufficient motivation to trigger a suicide bombing ?

    Even without the extreme case of terrorism in democra
  • by Animats (122034) on Saturday September 06, 2003 @02:06AM (#6885936) Homepage
    We have a real problem, and it's that the laws governing business have changed drastically in the last two decades. Few people follow things like the Private Securies Litigation Reform Act and the holding periods for restricted stock, but those things really matter. Here's why.

    One real problem is rewarding executives for volatility, rather than profits. We need long holding periods on insider stock, maybe five years. That way, if you do a startup, you don't get to cash out for five years, by which time it's clear whether the profits are real. The holding period used to be two years; it was changed to six months in the mid-1990s. Look what happened.

    Pay for volatility encourages dumb merger and acquisition activity. Most mergers turn out to be a long-term lose for the stockholders, but a short-term win for management. Management needs to be on the hook for long-term losses.

    Executive pay should be set by the stockholders. Each stockholder puts on their proxy how much the CEO's total compensation should be, and the share-weighted median is used. Executive pay is up by a factor of several hundred since the 1950s, even after inflation adjustment. Third-rate CEOs of money-losing companies are making multimillion dollar salaries. Executive pay decisions should pass through the ultimate owners, who are typically people with money in pension funds.

    Those two changes alone would cut out considerable dumb financial activity.

  • by NewtonsLaw (409638) on Saturday September 06, 2003 @02:50AM (#6886055)
    I have been similarly disadvantaged by the "sharp" practices of so-called "businessmen".

    Back in 1999, I "was" 7am News [7am.com], a web business that effectively established the viability of syndicating content on the Net.

    I had to fight for my success along the way, fending off attempts by "big" old-school publishers who claimed that syndicating their headlines and links to their sites was a breach of copyright and who didn't understand the difference between republishing and hypertext linking.

    After starting the venture in 1997, and investing 18 hours a day, 7 days a week for nearly three years, I'd built the business up to the point where 7am.com's server was dishing out the news over two million times a day and Nielsens/NetRatings ranked it ahead of the BBC's news website, Fox News, Wired.com and even Playboy.com :-)

    By 2000, 7am.com was delivering its news content through a nework of nearly a quarter-million third-party websites and was valued at US$20m-US40m (wasn't everything in those days though?).

    Back in 1998 I was offered $1 million for the business by a US-based company but chose not to sell because they wanted to simply strip it for inclusion into their own product.

    By 1999 I was still working 18/7 but had the help of two part-time writers who were also producing news and the service had racked up an impressive record for breaking news on the web. (Believe it or not, 7am.com was actually the first website in the world to carry the pictures beamed back from the surface of Mars by the Pathfinder mission).

    Anyway, I was eventually promised the earth by a group of investors who assured me that they were not interested in simply asset-stripping the business, but were actually planning to grow it in a way that would ensure it continued to be innovative and maintain its lead in the field of syndicated news content and independent reporting.

    My goal was not to become a "get rich quick" dot-com millionaire (I knew that would be a "fad") but to set myself up with a good shareholding in a company with long-term profitability.

    Well do I look stupid now?

    I still have around 30% of the shares in 7am.com but through some very clever "manipulation" by the investors, and a total lack of vision and willingness to accept good advice, that shareholding is effectively worthless.

    Not only did they not invest in the continued growth of the company, they also hired another company (in which they had a shareholding) to provide consulting and other services which were never delivered (but they were paid for).

    It appears very much to me as if 7am.com became a company that was used to raise a bundle of cash that could then be shifted into another company that was really their darling-child. The conflict of interest wasn't disclosed until after the contracts were signed and the money paid.

    What's worse, they completely ignored my advice in respect to how the company should be changing and growing to maintain its dominance of the market it had created.

    As a result, 7am.com, which was once the world's most widely syndicated web-based news sercice, is now a no-name website that no longer even features on the Web rankings.

    Its news content is no longer fresh, exciting and different. Its offerings are tired and old, there's no innovation, no energy, no value left.

    Because it's been run into the ground, the investors have lent the company huge sums of money by way of "convertible notes."

    This means that if the do manage to sell the company as a going-concern, they can convert those loans into shares and thus effectively dilute my shares to near-nothing. If however, they sell the company's assets, then they simply use the money to repay the notes (plus interest) -- effectively leaving nothing for the shareholders but an empty shell.

    Whatever happens, it's not so much the loss of money and long-term income that hurts, it's the fact that a really terrific ser

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