An Alternate Web Based Upon Mesh

wireless_mesh_newIn a blog last week I talked about an alternate model for the Internet that can make it safer to communicate with others. The idea that I explored last week was to base web transactions on block chains, which is a technology that decentralizes communications without needing to pass through centralized servers.

Today I want to talk about mesh networks as another idea on how to develop safer communications. There is now a movement within the country to create mesh networks as an alternate to the traditional web. Mesh networks have been around a long time. The concept of a mesh is simple. Today’s Internet relies solely upon making every connection for every transaction through an ISP. The ISP, using a series of servers and routers, then directs your traffic to where it’s supposed to go.

But it is these servers and routers that are the weak points in today’s web. First, the ISP is recording everything you do and mining every piece of data you send through them. These servers and routers are also where malicious entities get access to your data, making you vulnerable to everybody from hackers to the NSA.

The idea of a mesh network is to skip these intermediate checkpoints whenever possible. In a mesh network every device in the mesh is able to communicate directly with the other devices within the mesh. Picture, as an example, a neighborhood where all of the households meshed their WiFi networks together. In such a network you could communicate with anybody in the neighborhood and exchange data with them without having to go back to the ISP network. It would function as if you were all on the same WiFi network within a home. Granted there is not generally that much traffic exchanged with your neighbors, so such a network would be of limited use. But it’s an example of how a mesh works.

There are other existing examples of mesh technology today. For example, there are now a lot of applications for smartphones using bluetooth. These applications let people in close proximity to each other exchange business cards or texts or other forms of communication that don’t first get routed back to the cellphone hub. Any data exchanged in this local manner is not subject to being recorded or tracked at the hub.

Probably the biggest use of mesh today is Firechat. This is a mesh app for smartphones that lets users within close proximity communicate with each other using Bluetooth. This is big with younger people and there are over five million people using the app. With Firechat kids can message each other privately at concerts or at school if there are enough users in close proximity to create a mesh network. The app allows for private communications are private and also can provide the ability to message in places where cellular or texting doesn’t work.

Is it possible to take the idea of mesh networks further than is being done today to make them practical in a wider setting? I can picture such networks. For example, the students at a university could band together to create a mesh network from all of their WiFi connections. Inside such a mesh the students could communicate with each other free of the University servers recording everything they do and say. Such a mesh network would be decentralized and nobody would be able to monitor or record what was done on the mesh. Over time, private connections could be established between different university mesh networks, which would allow students to also communicate with students on other university mesh networks.

It would be a lot of work to establish and maintain such a network, but there are a lot of people who are growing alarmed at all of the spying done upon us on the open web. Mesh networks would pull people-to-people communication out of the open web and make it private. When somebody on the web chose to make a connection to the current web, and say, make an enquiry on Google, then Google would be able to track them just as is done today. But communication inside the mesh network could provide an alternative to social media or using one of the public messaging services, all of which are monitored by somebody.

Mesh networks are certainly not a total solution to achieving privacy on the web. But it can be one more tool in creating an alternate mode for communication that is not subject to spying. One can picture the ability to join different mesh networks for different purposes, each of which provides you some privacy and which keeps some parts of your web life off the original Internet, which today suffers from cybercrime, data mining, constant surveillance, and the fear of hacking.

There are a few organizations like Commotion and The Free Network Foundation that distribute software and information on how to establish a mesh network. But so far this has been a very tiny effort being promulgated by privacy advocates. It probably will take some entrepreneurs to establish more widespread mesh networks if they are ever going to take hold as an alternate to the existing web. The tools needed to do this exist already and perhaps somebody will take the initiative to create a nationwide mesh network for messaging, chat, and texting, away from the existing web.

I think there is at least some chance that hacking will become so invasive that people will be seeking alternative ways to communicate. If mesh networks are combined with other tools like block chains, then perhaps we can all take back some of our online life from the many entities who spy on us today.

My Review of Sling TV

Fatty_watching_himself_on_TVAs I mentioned in an earlier blog, I signed up with Sling TV because I wanted to see what web TV is like. My household is already a big user of Netflix, Amazon Prime, and Hulu, and I have a very good opinion of all of those services. I will admit that I don’t watch Hulu as much as the other two since I have yet to buy the premium service there, and so for now I suffer through the commercials. But all three of these services have a decent level of quality and I have rarely had problems watching what I want to watch.

I also have access to HBO Go. Comcast forced me into a small TV bundle in order to get faster Internet, and so I have the basic package that consists of the major networks plus they threw in HBO. I like the quality of the HBO online product, and in fact it seems to have better picture quality than the other web services, although it boots me from time to time.

But sadly I have not had the same experience with Sling TV. One of the reasons I got Sling TV was to watch the NCAA basketball tournament. It turns out that my favorite team, the University of Maryland, was playing two games on TNT, and these games were not available anywhere else on the web. I also caught U of M’s women’s basketball game on ESPN2.

The experience of trying to watch basketball on Sling TV was painful. It started when I first tried to log on to the service and repeatedly got the message that the feed was not currently available. It took me almost ten login attempts to make a connection. When I finally connected, the ‘reception’ was pretty good, about the same quality that comes with standard definition service on Netflix. The picture was clear enough and it looked good on my 27 inch monitor.

But after about ten minutes it started to have problems. First, I lost my connection and it took me a full ten minutes to reconnect. To a basketball fan that’s an eternity. I finally got the game back and it was pretty decent quality again. But then I started having problems with the audio. The announcers’ voices started clipping to the point where I had a hard time understanding them. Within another ten minutes the audio had also gotten almost two seconds out of synch with the video, with the voice coming in before the picture. This was really disconcerting.

I found that if I restarted the service that I could fix the voice, but I again needed multiple attempts to get reconnected. By the second half of the basketball game the audio was just so awful that I turned off the sound and listened to the rest of the game on Sirius radio while watching the video. There were times during the game when I got significant pixilation, although this tended to clear itself after a few minutes each time.

I had this same thing happen on other channels including ESPN, ESPN2, and the Food Network. The problem was not as pronounced on ESPN, but the audio problems were still there.

I have a 50 Mbps cable modem that has low latency, and I can’t remember ever having any major issues on Netflix or Amazon Prime. In hundreds of hours of viewing I may have been booted from those services maybe three times. So I know it’s not my Comcast connection. The problems I had with Sling TV are puzzling since it’s a unicast and every viewer gets the same signal at the same time. I’m curious how many other viewers had the same problems I did.

There are some good features of the service. While they advertise that you get ESPN and ESPN2, a subscription also gets you a feed into ESPN3, the online ESPN programming. I looked at several college baseball games, some wrestling, and soccer on ESPN3. The feeds I watched for past events did not have the same issues, so perhaps the problem is only with real-time feeds. I was not given access on ESPN3 for content on the SEC network, but I find that understandable.

But for now, until Sling TV figures out these issues, the service is not ready for prime time. This makes me sad because I want web TV to be successful. But my experience of watching several basketball games was horrible and was some of the worst sports viewing experiences I have ever had. This was even worse than trying to watch sports via satellite on days when the pixilation is bad. Luckily you only have to buy it one month at a time and I will come back in the fall when it’s football season and try again. I would certainly caution folks against signing up for the three month subscription they are offering without trying it first.

If web TV is going to succeed they have to be able to offer the same quality that people expect elsewhere. They are directly competing with Netflix and Amazon Prime and customers can easily compare their quality against those services. But they are also competing against the quality of normal cable TV systems and satellite. If web TV isn’t at least as good as those two alternatives they will have a hard time retaining customers.

What is WebRTC?

logo-webrtcThere is yet another new threat/opportunity for the telecom industry in WebRTC. That stands for Web Real Time Communication and is a project to create an open standard for delivering high-quality voice and data applications for a wide variety of platforms including browsers and mobile phones, all using the same set of protocols.

The most immediate use for the new standard is building direct voice and video communication applications from every major web browser. The project is being funded and developed by Google, Mozilla, and Opera. Microsoft has said that they are working towards developing a real-time WebRTC app for Internet Explorer.

From a user perspective, WebRTC will enable anybody to initiate voice and/or video communication with anybody else using a browser or using a WebRTC-enabled device. What is unique about this effort is that the brains of the communication platform will be built into the browser, meaning that an external communications program will not be required to make such a connection. This creates browser-to-browser communication and cuts out a host of existing software platforms used today to perform this function.

This means that the big browser companies are making a big play for a piece of the communications market. The WebRTC platform will put a lot of pressure on other existing applications. For example, WebRTC could become the de facto standard for unified communications. This would let the browser companies tackle this business, which is today controlled by softswitch, router, or software vendors.

WebRTC is also going to directly compete with all of the various communication platforms like GoToMeeting and Skype. I know I maintain half a dozen such platforms on my computer that I’ve needed to view slide shows from different clients or vendors. WebRTC would do away with these intermediate platforms and let anybody on a WebRTC browser communicate with somebody else with WebRTC. You should be able to have a web meeting where there are participants on Google Chrome, Mozilla Foxfire, or Internet Explorer, all viewing and discussing a slide show together from their different platforms.

In the next generation of the standard the group will be developing what they call Object-RTC, which will be a platform that will integrate the Internet of Things into the same communications platform. This will enable anybody from any browser to easily communicate with devices that are on the Object-RTC platform, making it far easier for the normal person to integrate the IoT into their daily lives. This could become the standard platform that will allow you to communicate with your IoT devices equally easily from your PC, tablet, or smartphone. This is presumably a market grab by the browser companies to make sure that the smartphone doesn’t become the only interface to the IoT.

While the WebRTC development effort is largely being funded by Google and the other browser companies, numerous other companies have been developing WebRTC applications in an effort to keep themselves relevant in the future communications market.

Since the WebRTC platform is browser-based, it’s estimated that it will be available to 6 billion devices by the end of 2019. One would think that browser-based communications will grow to be a major means of communicating by then, putting additional pressure on companies today that make a living from providing voice.

Because it’s browser-based, WebRTC is likely to have more of an initial impact on the residential market. Larger businesses today communicate using custom software packages, and as WebRTC becomes the standard those platforms will likely all incorporate the new standard. To that effect we have already seen some large companies snag some of the early WebRTC developers. For example, Telfonica acquired start-up Tokbox in 2012. More recently, the education software services company Blackboard bought Requestec. And Snapchat paid $30 million to buy WebRTC startup AddLive.

One can expect a mature WebRTC platform to transform online communications. If people widely accept WebRTC (or the one of many different programs that will use the software), then it could quickly become the standard way of communicating. What is clear is that with companies like Google, Microsoft, and Mozilla behind the effort, this new communications standard is going to become a major player in the communications business. This is going to be mean fewer minutes on the POTS telephone network. It will also put huge pressure on intermediate communications platforms like GoToMeeting, and those kind of services might eventually disappear. I remember hearing somebody say a decade ago that voice would eventually be a commodity, and this is yet another step towards making voice free.

CenturyLink Bullish on Fiber

CenturyLinkAt a time when AT&T wants to ditch millions of copper lines, and when Verizon apparently want to phase out of the wireline business and is even selling off FiOS, CenturyLink is taking a different approach.

The company has begun building gigabit fiber in a few cities and has announced plans to build in many more. CenturyLink has already deployed gigabit fiber to some residential customers in some parts of Omaha and Las Vegas, and to some businesses in Salt Lake City. The company has announced plans to provide new residential gigabit fiber in new markets including Seattle, Portland, Salt Lake City, Denver, Minneapolis / St. Paul, and in Columbia and Jefferson City in Missouri. Additionally the company plans gigabit fiber for businesses in Spokane, Sioux Falls, Colorado Springs, Albuquerque, Phoenix and Tucson.

This initiative makes CenturyLink the only large incumbent telco that is investing in fiber. And since the cable companies are mostly upgrading speeds in response to competition, this make CenturyLink the only large ISP that is being proactive with fiber.

With that said, I have no idea how much fiber they are actually going to build. CenturyLink inherited a company from Qwest with a very ugly balance sheet and which still today does not spin off enough cash to make a huge fiber investment. And so there is the possibility that they are building a little fiber in each market for press release purposes and not intending (or able) to finance the construction of a lot of fiber in the same way that Verizon invested in FiOS.

But in reading between the lines I think they really want to invest in fiber. CenturyLink inherited possibly the worst local network in the country when they merged with Qwest. Qwest had been in marginal financial shape for so long that they had let the networks in most markets deteriorate significantly. Qwest instead invested on long-haul and large city downtown fiber to make money in transport, long distance and sales to large businesses. And they did okay in those areas and have one of the best nationwide fiber networks.

CenturyLink has the most to lose of the large ISPs. AT&T and Verizon have become cellular companies that also happen to be in the landline business. The cable companies have captured the lion’s share of the residential data market almost everywhere. But CenturyLink has no fallback if they lose landline-based revenues. They inherited a network that lost the residential battler everywhere in head-to-head competition with the cable companies. And in every large city they have significant competition for business customers from CLECs, cable companies and fiber providers.

So I think CenturyLink has hit upon the right strategy. In every market (or at least in every neighborhood) there is likely to only be one fiber provider who is willing to build to everybody. Over time, as households and businesses want more data, fiber is going to be the only long-term network that will be able to satisfy future data demand.

I keep hearing about having gigabit wireless products someday, but the physics of that product will require mini cell sites that are close to customers. And that means having a cellular network that is fed by neighborhood fiber. Anybody who thinks that the cellular companies are going to be able to supply that kind of bandwidth with the current cellular networks doesn’t understand the physics of spectrum.

I wish CenturyLink well in this endeavor. Most of the potential markets want fiber and the company will do really well if they can find the financial resources needed to build significant fiber. Their copper networks are dying and there is very little they can do about that. There are currently some industry patches on copper such as using two copper pairs joined together, but these are band-aids being applied to a dying network. Looking twenty years into the future, if CenturyLink doesn’t build fiber they won’t have much left.

I am still surprised that Verizon is selling off mature cash-cow FiOS fiber networks like they recently announced. But Verizon has obviously been taken over by the wireless guys who seem to want them out of the wireline business. But CenturyLink has no other options, so I think they either go to fiber or watch their networks and their business slowly die.

The Future is Almost Here

Alexander_Crystal_SeerIt seems there has been a flip sometime in the last few years in how quickly predictions made by futurists have become reality. It has historically been the case that new technologies have taken longer to come to fruition than what visionaries imagined. But lately, I have read numerous articles from futurists saying that they are seeing just the opposite, and that things are becoming reality now much faster than what any experts has predicted.

I have heard for years that the rate of acceleration of the growth of human knowledge is getting faster all the time. I may be remembering the quote wrong, but I recall an article I read a few years ago that claimed that the knowledge mankind has gained in just the last few years is greater than all of the knowledge that has been gathered in all of mankind’s history.

That is an amazing claim, but there is a lot of evidence that it’s true. Consider this article that talks about the major scientific announcements that have been made public just in January and February of this year. The list is astounding. Here are just a few of the things on that list:

  • Scientists have discovered teixobactin, the first new antibiotic in 30 years.
  • The first map of the human epigenome has been completed: these are the switches that can turn individual genes in our DNA on and off.
  • There is a new electron microscope that can see individual atoms.
  • Physicists have found a way to accelerate particles to nearly the speed of light without the application of any external forces.
  • Researches have been able to grow human skeletal material in the lab that acts just like the real thing.
  • Stem cells have been used to create cells that can grow human hair.
  • Astronomers have found a black hole that is 12 billion times as massive as our sun.
  • Cosmologists have developed a new physics model that suggests there was no big bang and that the universe has existed forever.
  • Scientists believe there are two more planets beyond Pluto.

Every one of these claims is a big breakthrough, and yet there are so many scientific discoveries being made that most of them barely get any press. I follow tech and science and I had not heard of nearly a third of the items on this list.

I was always interested in science as a kid and I remember even at a young age avidly reading articles in places like Life Magazine that talked about the discovery of how DNA worked, the invention of polymers, or finding the early hominid Lucy fossils. It seemed like there was a major scientific breakthrough a few times each year and such things got wide coverage. As I got a little older I would read Scientific American and other sources of information about science and would see the same thing. There was progress here and there in scientific fields, but nowhere at the pace of what we are seeing today. I have no idea today how scientists stay current since there is so much happening in so many fields. It’s always been understood that any important discovery often leads to progress in other fields of study as scientists understand the implications of various discoveries.

Certainly there are good reasons for the breakthroughs today. Probably first is that we have better tools. We are able to look deeper in space with amazing light and radio telescopes; we can look at smaller things with electron microscopes. And with modern computers, we can crunch the data from experiments faster and more accurately. Science for many years was more about handling the data from studies than it was about doing the actual research.

What is most amazing is how un-amazing this all seems. Twenty or thirty years ago most of the above recent announcements would have been major news. But when we are bombarded by amazing discoveries every time we browse news articles, the amazement gets a bit dulled.

The real excitement for me is all of the areas of research that are getting close to major discoveries. Just in the medical area there are breakthroughs expected in areas like cryonics (keeping people in suspended animation), nanobots for fighting cancer and other diseases from inside the bloodstream, laboratory-made replacement organs, reversing or halting aging, and brain and memory enhancement. And every field of science and technology has its own similar list of amazing things that will probably become reality within just a few years.

Why Not Faster Data Speeds?

Speed_Street_SignI was recently at my mother-in-law’s house and saw an example of what competition can do for the country. She lives in Kyle, Texas, which is an outer suburb of Austin. When I say outer, it’s an hour’s drive to downtown Austin.

As I was working on my laptop using her WiFi, it felt like it was faster than in previous times that I had visited here, so I ran a speed test. And sure enough, her bandwidth measured in at a little over 70 Mbps download and 10 Mbps upload.

She buys only the basic Internet product from Time Warner. I am pretty sure that in the past this was a much slower product, closer to 15 Mbps, and possibly less. But for certain her speed has been increased significantly due to competition. By now everybody knows that Austin is in the midst of significant competition with Google, Grande and AT&T each selling a gigabit data product, while Time Warner which now has speeds up to 300 Mpbs. What this competition has done is to up the game for everybody in the market.

The sad thing is that it takes competition to get the cable companies to up their game. I doubt that many other Time Warner markets around the country have base speeds of 70 Mbps, and probably none of their other markets has speeds of 300 Mbps.

I really don’t understand why the cable companies don’t just increase speeds everywhere as a way to fend off competition. One would think Google might be a lot less likely to build fiber into a market if every customer there already had 300 Mbps data speeds. The cable companies in most markets clearly have the majority of customers, and certainly have all of the customers who are interested in fast speeds. They have it within their power to be market leaders and to bring fast speeds today, so that any future competitor will have a hard time denting their lucrative markets.

Instead many of them sit and wait until the inevitable announcement of competition before they do the upgrades needed to get faster speeds. For example, Cox has announced that in Omaha and Las Vegas they will have speeds as high as a gigabit in response to fiber deployment by CenturyLink in those markets. But not all of them are waiting. For example, Charter recently doubled the speeds on most of their products. That is not the same as offering blazingly fast speeds, but it really makes a difference to boost their base residential product to 60 mbps.

I know that there is a cost to upgrading data speeds. But recently Time Warner Cable said in their annual report that they have a 97% margin on their data products, a number that opened a lot of eyes nationally. One would think that the cable companies would do anything to protect a product with margins that high and that they might spend some of that margin to fend off competition.

I have no idea how well Google does when they come into a new market. I know that when a municipal provider comes to a market they generally get 40% to 60% market penetration with their data products. But the Google product, at a premium price of $70 per month is probably not going to attract quite as many customers. Still, one has to think that they probably get at least 30% of households.

Cable companies have a lot to lose if they lose 30% or more of their customers in the large urban markets. It’s clear that the cable TV product today has very poor margins (if not negative margins) and so the future of the cable companies comes from data sales. They are in the enviable position of already having gotten most of the customers in most market and one would think they would want to jump in front of potential competition and head it off before it even starts.

But they are not acting like companies with a lot to lose. To me it feels like they are making a strategic error by not being more proactive with data speed upgrades. The cable companies are largely disliked by their customers, and they could go a long way to change that perception by unilaterally raising data speeds to be as fast as they can make them.

I am glad to see competition forcing data speed increases, but the majority of markets are not competitive. But in my mind, if the cable companies wait to increase speeds only after there has been an announcement of a coming competitor in each market, they will have lost the game. People are going to perceive that as too little, too late. And it’s a shame, because we know in Austin what a cable company can do if they are motivated by competition. I just scratch my head and wonder why maintaining markets with a 97% margin data product is not enough motivation to fight to keep the customers they already have.

 

WiFi to Challenge Cellular?

Wi-FiIt’s a rather new phenomenon, but we are seeing the beginning of a shift to making more voice calls on WiFi networks than on cellular networks. As Americans have become more conscious about making data connections on WiFi they have opened the door to using WiFi for their voice usage.

The trend of using WiFi for voice, as it matures, could really shake up the cellular industry. The AT&T and Verizon cellphone plans are among the most profitable products sold by any corporation and that makes them a target for competitors, and a place for consumers to save money.

It’s funny how the industry has changed so much. I remember twenty years ago going to state commissions and asking, and being rejected, for $2 rate increases in local telephone rates because the regulators feared that people couldn’t afford to pay it. And yet a decade later families went from having a $30 home phone to paying three and four times that much for cell phone plans.

There are several companies that have been selling WiFi calling for the last few years. FreedomPop, which started in 2012, offers a product that uses a network of over 10 million hot spots in places like McDonald’s or Starbucks. FreedomPop’s phones will automatically join WiFi networks much like a normal cellphone automatically connects to a cell tower. Their rates are really low and for $5 a month a customer can have a WiFi-only plan that connects to the network of WiFi hot spots. There are other slightly more expensive plans that use a combination of WiFi hot spots and Sprint’s cellular network when WiFi isn’t available.

Republic Wireless has a similar set of products. For $5 a month, customers can make calls or connect to the Internet solely over WiFi. For $10 a month, they can use both WiFi and Sprint’s cellular network. Republic Wireless has developed a technique that lets customers roam between hot spots (but this roaming is more suited to walking than driving in a car).

Scratch Wireless has an even more aggressive plan and using their WiFi network for voice, text, and data is free as long as you buy their $99 Motorola Photon Q phone. They then sell pay-as-you-go access to voice on Sprint’s cellular network starting as low as $1.99 per month.

These companies are growing rapidly. FreedomPop says it is doubling its customer base roughly every four to six months; Republic Wireless says its customer base is growing 13 percent a month. But both companies are still really tiny compared to the big carriers and are mostly catering to those who live mostly around WiFi and who are cost conscious. From what I can see, both companies get rave reviews from their customers.

Cablevision recently announced a WiFi-only plan for $30 a month for non-cable customers but only $10 for bundled customers. I don’t understand their pricing, which obviously is not going to be very attractive to non-Cablevision customers. Cablevision operates an extensive network of hot spots in New York, New Jersey, and Connecticut.

The real disruptor might be Google. They announced that they are going to be offering cellular phone plans and the industry seems to think that they will be WiFi-based. Certainly in the markets where they have fiber networks they could saturate the market with outdoor WiFi hotspots and offer a true competitor to cellular. Google has always said that they think bandwidth ought to be ubiquitous, and since they don’t own cellular spectrum, they are going to have to go the WiFi route and also make a deal for off-network minutes from Sprint or T-Mobile.

One also has to think that Comcast has their eye on this. They certainly are rolling out a huge WiFi network as they turn customer routers into public hot spots.

And so the phenomenon is starting to grow. The large cellular companies say they aren’t worried about this, but one has to think that in the Boardrooms they are keeping an eye on this trend. For now there are issues with using these products. One is data security as it’s fairly well known that public WiFi hot spots are loaded with danger for users. This has to be the case whether you are hitting a hot spot with a PC or a cellphone.

I know that personally I will probably stick to a bigger company plan. When I travel it is more often to out-of-the-way places than to big cities. And those kind of places generally have coverage of some sort by the big carriers, but are often uncovered by smaller carriers like Sprint and T-Mobile. I would not like to find myself in a small town for a few days with no cellphone coverage. Other than that travel, I work at home and could easily use my own WiFi rather than pay for cellular.

For the product to be competitive, it’s also going to have to be usable on the major phones being sold. Not having this product for the iPhone or Samsung Galaxy limits the target audience. For now the small carriers like Republic load their own proprietary software on the phones they sell to users. But as that turns into a downloadable app I could see this product picking up a lot of traction in cities.

AT&T and Verizon are right to not be worried about this today. But if you look forward a few years this could grow into a significant competitor to cellular. Which, even if it doesn’t mean a loss of a lot of customers for the big companies, will mean overall lower prices for cellphone plans. That is something they ought to be worried about.

 

Are We at the End of Creative Destruction?

closed-factory-Flickr-sludgegulperCapitalism has thrived over the past few centuries due in large part to a phenomenon called creative destruction. This phrase was coined by economist Joseph Schumpeter and refers to the process where new technologies and new industries replace old ones, with a net gain for society.

There are thousands of examples of this through time. In the transportation area alone we’ve moved from horse & buggies and canals to cars, subways, interstate highways, and airplanes. We’ve moved from hand looms to cloth factories to synthetic fabrics (and were able also to replace the ironing board). There is almost nothing from a hundred or more years ago that is still made in the same way.

Creative destruction has always resulted in a net good for the economy and has thus been good for mankind. For every technology that has been displaced something better took its place. Overall there were more jobs created by new technologies than displaced by old ones. Look at the automotive industry as a great example and consider how many jobs there are in car and parts factories, gas stations, repair shops, etc. — far more than were employed taking care of horses and trolleys.

I read an article that said that per capita incomes in the US were 28 times higher in 2000 than they were in 1790. This is largely due to creative destruction, which is why it’s the bedrock of capitalism. Each new technology that has come along has been more efficient than the last, and the growth in wealth has largely been due to this increase in efficiency.

This is not to say that creative destruction is not disruptive. People who worked for industries being displaced have always lost their jobs. This is never smooth on a local level and there are thousands of communities along the way that suffered when their local factory or businesses were supplanted by something new. To a large degree, over the last century the new businesses tend to be in urban areas, which is one of the contributors to the long-term trend of rural populations migrating to cities around the world.

But there are now a number of economists who think that we might have reached the end of creative destruction and that the old paradigm is no longer functional. Economists measure overall efficiency of an economy using labor productivity – the output per hour of the average worker. For example, since World War II productivity grew at an annual rate of about 3%. But starting in 2004 that rate has slowed to 1% per year, and most recently is under 0.5%. This is one of several factors that have led to wage stagnation.

There is still a lot of wealth being created in the country, but a lot of it now comes from information technologies and not from the historic phenomenon of replacing industries with something better. A great example is Facebook and all other social media. They have created tremendous wealth for their creators, but they are replacing and/or monetizing older ways of socializing. Granted they are new industries, but they bring very few jobs. It’s amazing how many of the largest web companies have created billions in wealth with less than a few hundred workers.

Lately, we are also seeing whole industries dying without being replaced by new jobs. The typical example given is photography. There was a huge photography industry that was replaced by digital cameras. Gone are most of the companies that made cameras and film and who processed pictures for people, replaced by one minor component of smartphones. But this has happened to other industries like the music business and the news business. Blogs are interesting, but they really don’t take the place of having live news coverage of worldwide events.

Worse, we are standing at the edge of a time when large numbers of jobs might be permanently replaced. For example, companies like Amazon created a large numbers of jobs in their warehouses, but they are working to automate the whole warehouse process. We see robots starting to take on roles like hospital orderlies, hotel concierge, baristas, and a number of other jobs. The combination of robots and AI is also likely to start replacing scores of traditional white-collar jobs like accountants, paralegals and other information workers.

The big changes we are now seeing are due largely to both the application of Moore’s law and the fact that computers are getting strong enough to be able to mimic human behavior well enough to take over functions that only humans could do.

I always read that there is still going to be room in the world for human creativity. The problem with that is that society probably won’t value a lot more creative jobs than there has been. We’ve always had our inventors and scientists and writers and artists and most people are not able to do this kind of creative work, nor is there going to be a huge uptick in demand for these kinds of skills (meaning somebody willing, or able, to pay for it). It could be that creative destruction is now going to be replaced by plain destruction and that technology is going to replace a lot of jobs that cannot be replaced. If so, the world better get ready to find ways to deal with a lot of people who can’t find paying work. It’s a scary thought.

Voice Over LTE

4g_mastA few people have been lucky enough to try Voice over LTE (VoLTE) on their cellphones. This is a new application that carries voice calls over the 4G data bandwidth instead of as a separate voice channel as is used for traditional cellular calls.

I say they are lucky, because the quality of VoLTE is much better than the quality of normal cellular calls. This is due to the call being able to handle a wider range of voice frequencies (normal phone calls have always chopped off both lower and higher frequencies, which is why people don’t sound the same on the phone as they do in person). VoLTE is supposed to be close in quality to High Definition voice (HD) which is currently being provided by some landline providers.

VoLTE calls are more akin to a call made on Skype with a quality microphone. If you’ve ever talked to somebody on Skype who was in a boardroom or somewhere with great microphones you will know what I am talking about. You can hear somebody with as rich of a voice sound as talking to them in person. When Skype is not so good it’s mostly due to the crappy microphones in PCs and laptops and not due to the technology.

There are still some significant drawbacks to VoLTE that the industry is working out. Roaming is the biggest issue. Currently, if you are talking on VoLTE and move out of the range of 4G the call will drop. The calls are not downward compatible to 3G or 2G data connections. There is also compatibility issues between carriers since there are still no standards, so you might have trouble talking to somebody using another cellphone provider. AT&T and Verizon are working to make their two networks compatible, but other carriers have not yet been integrated with anybody else. Finally, VoLTE only makes a difference if both callers are talking on VoLTE.

But the major drawback today is one of availability; all of the US carriers have introduced VoLTE only on a trial basis in a few markets. And even where it’s available, it’s only been introduced for a small number of handsets by each carrier. You are more likely going to get to try this first if you use an iPhone or Samsung Galaxy.

Early testers of the technology have made some interesting observations about it. Certainly being able to hear the other party better is a huge benefit. The calls also connect much faster since the call is not making its way through the normal telephone network. One of the most interesting observations is that sometimes you can make VoLTE calls when there isn’t normal cell phone coverage. This is due to the fact that some of the spectrum used to deliver 4G has a larger footprint than the spectrum used to make voice calls.

There are a number of benefits to the carriers of the technology in that it relieves pressure from the spectrum used for voice-only. We’re all familiar with trying to make a call in a stadium or on a freeway at rush hour and not being able to get a signal. But as long as you can get a 4G data connection, even a slow one, you will probably be able to make VoLTE calls.

Calling with the technology is also going to save on cellphone battery life. Today your cellphone spends a lot of energy changing between different frequencies to handle voice and data, or between different types of data.

The technology also supports video calls, which means that it will be easier to have video calls on all phones similar to the  the FaceTime app that comes with iPhones.

Probably the biggest issue with the technology will be how the carriers price it. Callers with small data caps are going to be nervous using VoLTE if it counts against their data plans.

The network owners are working out standards and technologies. Currently, a VoLTE call must be routed back to the switch of the cellular provider before a call can be routed, which is an inelegant network solution. But the industry is working towards a standard called RAVEL (Roaming Architecture for Voice over LTE with Local Breakout) that is going to allow calls to be routed locally when appropriate.

One has to think that eventually this is going to become the voice standard and that the carriers will do away with using a separate frequency for voice. That would allow them to make their networks into 100% data networks and eventually do away with the idea of selling minutes.

There were some field trials of the technology in 2014 and we will be seeing more implementation during 2015. But don’t expect this to be widely available in major markets until 2016 and obviously later in markets that still use 3G.

Can There Be a Safer Internet?

Supporters hold yellow umbrellas as Hong Kong student leaders arrive at the police headquarters in Hong KongI probably feel very much like most people in that the Internet is feeling less and less safe to use. Viruses have been around a long time, but once you learned to not open emails you didn’t recognize, that risk became somewhat minimal. But now you can get viruses just by opening a web site that has corrupted ads. I know this because I got three such viruses a few weeks ago.

But that’s not even the scary part since I can generally scrub viruses from my computer. There are far worse risks than viruses today. To start with, there are the people who are sending malware and then holding your computer hostage until you pay them (and who then, apparently, still don’t fix your machine).

And it appears that everybody is spying on us. Edward Snowden has shown us numerous ways that the NSA is watching us. I literally get dozens of new tracking cookies on my computer every day from commercial companies that want to track me somehow. And every large web company is apparently gathering data on us, including companies like Facebook and Google along with most of the apps we put onto our smartphones.

But since my work depends on using the Internet, and since it also has become one of my major sources of entertainment, I am not likely to abandon the Internet due to lack of safety. I do what I can to be safe, but I doubt it makes much difference. I scrub my machine every day from tracking cookies and I use browsers that supposedly don’t track me. But my guess is that those two things make almost no difference for protecting my computer or my privacy.

The biggest problem, aside from every web entity trying to build a profile on me, is that the entire web is based upon a model where everything we do winds up somewhere at end points that cannot be made safe. Everybody is touting encryption as a way to stay safer on the web, but every encrypted message end up at a machine somewhere that decrypts it, and it is the end computers and servers that are the weak points in the Internet. Your data is stored on servers that are out of your control, and your safety relies on the people running those servers to be safe. And we all know that hackers are breaking into servers every day, and it may even turn out that there are back door spying keys built directly into most server software.

There are experts who say that the lack of safety might kill the Internet. We are incredibly reliant on companies that we don’t know to keep our data safe – and we have seen that both hackers and nefarious insiders can compromise almost any company. If the hackers win the war then it will become too unsafe to buy anything over the web (or even give your credit card numbers to vendors in some other manner if they are going to keep the info on their servers).

But there are alternate models of the Internet that might offer solutions. One of these is known as a block chain. Block chains are a decentralized system of communication that lets end users communicate directly with each other without having to go through the normal centralized servers. The block chain technology is most well known as the basis of Bitcoin and other cryptocurrencies. There have been numerous articles and papers written about the wild swings in Bitcoin pricing, but that has to do with basic economics rather than the underlying technology that allows the transactions.

In a block chain network, each member of the network has a copy of the software that identifies them as part of a particular block chain. Before communication is allowed between any two members of a block chain the identity of each party must be verified by somebody else who is part of the chain. With such verification the communication is allowed. The process is slow compared to normal web transaction, perhaps 10,000 times slower than a normal text or email. But it is safe. The steps needed to operate a block chain are as follows:

  1. New transactions are broadcast to all nodes.
  2. Each node collects new transactions into a block.
  3. Each node works on finding a difficult proof-of-work for its block.
  4. When a node finds a proof-of-work, it broadcasts the block to all nodes.
  5. Nodes accept the block only if all transactions in it are valid.
  6. Nodes express their acceptance of the block by working on creating the next block in the chain, using the hash of the accepted block as the previous hash.

There are already some examples of block chains being used for communications other than financial ones. For example, the protesters in Hong Kong last year established a block chain so that they could communicate with each other without Chinese government oversight.

There are new companies that want to use block chains to bring safety into other types of communications. For example, Codius is using block chains to provide safe online legal transactions. This provides a way for parties to safely sign contracts without having to exchange paper. Ethereum is working on a block chain technology that could be used as the basis for any kind of communication. They think their platform could be used for things like private chats, private emails, and even safe web searches.

One can envision many other uses for using block chains to create safe communications among specified groups of users. That might be a corporation and its employees, all of the students in a given dorm, or just about any group that wants safe communications. Such a closed system would provide for secure and private communication within the block. It’s not a total solution, but it’s a start.