Category Archives: Science

October 4, 2015 · 12:00

CISA and Privacy are not opposites

There is a view that many hold, this view is not educated. A view which was given to us from the moment we spawned as a living person. Some got this knowledge as they went to their church or temple. They were told about good and evil. When we started to go to school we got to learn about order and chaos. This last one matters, you see, the opposite that order and chaos represent has been used in books, in videogames, in TV shows and in movies. In the Avengers movie ‘Age of Ultron’, near the end of the film we hear a quote from Vision, played by Paul Bettany that matters: “Humans are odd. They think order and chaos are somehow opposites“.

You might not realise it but the gem that we have here is in the foundations of many issues that have been plaguing us in several ways. Let’s take a look at this in two parts. The first is a Guardian article (at http://www.theguardian.com/world/2015/oct/01/blackphone-release-data-protection-privacy-surveillance) called ‘Blackphone: privacy-obsessed smartphone aims to broaden its appeal‘. The very first paragraph is a quote that shows issues on more than one side “Privacy company Silent Circle has released a second version of its signature handheld, a smartphone designed to quell the data scraping and web tracking that’s become such an integral part of the digital economy in the last few years (and whose results might well end up with the NSA, if the Cybersecurity Information Sharing Act passes)“, now I have no issue with the data scraping part and for the most the term ‘whose results might well end up with the NSA’ is less of an issue, but the overall taste is about privacy, I have no issue with this. The next quote is an interesting one, which will matter soon enough “In the beginning, Janke said, the Blackphone project was just a way for people working for his security firm SOC, since sold, to call home without having their communications intercepted“.

You see, there is no issue with the message shown here, but what is linked to all this is the message that is not shown here. You see, this device should now be regarded as the most excellent tool for hedge funds managers, organised crimes and all other kinds of non-mentioned criminals, who will now get to do with ease and freedom the things they had to steeplechase around the block for. This device will allow financial advisors to take certain steps that they were too scared to do, all out of fear of getting caught. This device will be opening doors.

There is no issue with the approach Janke had, he was submerged (read: drowning) in a world where any slip up could mean the death of him, his comrades and perhaps even his family. So his need for security was a given. There is a need for such a device. I have written about the need for this device as early as 2009, so the fact that someone picks this up is not a surprise, so why are we looking at this?

You see, it is the mention of CISA that is part of all this. CISA or better stated the Cybersecurity Information Sharing Act is sponsored by Republican Senator Richard Burr (North-Carolina). Why would anyone oppose ‘the bill makes it easier for companies to share cyber threat information with the government‘? Let’s be clear this is about dealing with Cyber Threats!

So what is a Cyber Threat? A Cyber threat is defined as ‘a malicious attempt to damage or disrupt a computer network or system‘, so we have the fact that this is about malicious attempts! So why would there be an issue? Well, there is because people and as it seems to be especially criminals, terrorists and Organised Crime seem to be allowed a lot more privacy than their victims, so in all this I see little issues pop up all over the place. This sounds all emotional, but what does the official text state? Well, the complete text is at https://www.congress.gov/bill/114th-congress/senate-bill/754, so let’s take a look at some parts.

“Permits state, tribal, or local agencies to use shared indicators (with the consent of the entity sharing the indicators) to prevent, investigate, or prosecute offenses relating to: (1) an imminent threat of death, serious bodily harm, or serious economic harm, including a terrorist act or a use of a weapon of mass destruction; or (2) crimes involving serious violent felonies, fraud and identity theft, espionage and censorship, or trade secrets“, How can we be opposed to this? Is this not the foundation of growing fair play?

Well, that is partially the question. You see, the issue is in part the language. Consider this paraphrase which remains correct in light of the previous statement: “Permits local agencies to use shared indicators (with the consent of the entity sharing the indicators) to prosecute offenses relating to serious economic harm“. Which is now the floodlight of all this.

Now we get to the second part in all this, which is offenses relating to serious economic harm. Serious economic harm tends to be seen as pure economic loss, but it is not limited to that. For this we can look at the element ‘Loss of production suffered by an enterprise whose electricity supply is interrupted by a contractor excavating a public utility‘, which we see in Spartan Steel & Alloys Ltd v Martin & Co (Contractors) Ltd. In here the legislatively famous Lord Denning raised the issue of ‘Duty to mitigate loss’. Yet today, in the world of data and digital media, how can we measure that element? Let me show this through an exaggerated fictive example.

Microsoft raises the issue that as they required an investigation into acts that are causing serious economic harm to Microsoft. Unique software has been released that directly negatively impacts they trademarked business. The CISA could now be in effect to investigate data and data sources, but who minds that store? Who has that knowledge? Now consider that the person investigated would be Markus Persson, because his program ‘Minecraft’ is now stopping all people who are part of the Microsoft Gaming brand to continue.

So who will make that call? You might think that this is a ludicrous example, but is that so? Microsoft ended up paying more than 2 billion for it, so someone implying ‘Serious Economic Harm’ is not that far-fetched. This now becomes an issue for a timeline. What timeline is in effect here? With an imminent threat of death this is a simple matter, with serious economic harm that matter is far from simple, moreover will the claim be valid? I used the ludicrous Minecraft and Microsoft Games brand. Yet what happens when this is a lot more ‘grey’, what happens when this is Raytheon versus the Belgium based TTN Verhaert? A Technology Transfer Network (TTN) that has innovated the latest classified satellite navigation systems. Is it still a clear call as to what constitutes serious economic harm?

This act opens up a can of intellectual property, the one can everyone wants to swim in and the elected official channels do not even have a fraction of the minimum required insight to make such a call.

Section 9 gives us “Directs the DNI to report to Congress regarding cybersecurity threats, including cyber-attacks, theft, and data breaches. Requires such report to include: (1) an assessment of current U.S. intelligence sharing and cooperation relationships with other countries regarding cybersecurity threats to the U.S. national security interests, economy, and intellectual property; (2) a list of countries and non-state actors that are primary threats; (3) a description of the U.S. government’s response and prevention capabilities; and (4) an assessment of additional technologies that would enhance U.S. capabilities, including private sector technologies that could be rapidly fielded to assist the intelligence community”

When we consider both A and B, we should look at ‘U.S. SEC drops Onyx insider trading lawsuit against Dubai men’ (at http://finance.yahoo.com/news/u-sec-drops-onyx-insider-230111643.html) from September 15th. The quote here is “Smith said the Newman decision was ‘helpful,’ but that the SEC ‘never had a tipper’ or evidence that his clients received inside information”, one would think that this is where CISA could now step in. Alas, apart from the side that is implied by the CISA text: ‘assessment of additional technologies that would enhance U.S. capabilities, including private sector technologies that could be rapidly fielded to assist the intelligence community’, which according to Blackphone is not an option, we now see that this opens a door to ‘patsy management’ on how two unsecured parties, could be set-up through the use of Blackphone through encrypted conversations and when the two unsecured parties talk, they could be setting each other up thanks to the other two parties that were using a Blackphone. Blackphone here has no blame whatsoever, they would be offering the one part criminals desperately want, a secured phone. This now sets a dangerous precedence, not a legal one, because Blackphone is behaving itself as it should, the provider of secure communications, it is what people do with it that matters that part cannot be guaranteed by the Cybersecurity Information Sharing Act. In addition, S. 754 has one additional flaw. That flaw is seen in the definitions, where we see that the earlier mentioned definition ‘serious economic harm’ is not specified in the definitions at all, so what definition applies?

Beyond that, we see the definition of a cybersecurity threat. In here it is important to take a look at part A and part B.

part a gives us: “IN GENERAL.—Except as provided in subparagraph (B), the term “cybersecurity threat” means an action, not protected by the First Amendment to the Constitution of the United States, on or through an information system that may result in an unauthorized effort to adversely impact the security, availability, confidentiality, or integrity of an information system or information that is stored on, processed by, or transiting an information system” and part B gives us “EXCLUSION.—The term “cybersecurity threat” does not include any action that solely involves a violation of a consumer term of service or a consumer licensing agreement“, which sounds nice, yet how does it help stem cybersecurity threats?

You see, when you consider the letter send by UCLA to Chairman Dianne Feinstein in June last year, we see: “CISA’s inadequate use limitations risk turning the bill into a backdoor for warrantless use of information the government receives for investigations and prosecutions of crimes unrelated to cybersecurity“, which could be regarded as the biggest failure, but it is not, it is the part we see in “CISA requires that cyber threat indicators shared from the private sector with the Department of Homeland Security (DHS) be immediately disseminated to the Department of Defense, which includes the NSA and U.S. Cyber Command. This new flow of private communications information to NSA is deeply troubling given the past year’s revelations of overbroad NSA surveillance“. It is the ‘be immediately disseminated to the Department of Defense’ that comes into play now. When we consider ‘Overbroad Liability Protection‘, which can now hide by giving that function to an intern so that “good faith” reliance remains is a potential risk that could be pushed by big business to hide behind the ‘dope’ who acts in ‘good faith’.

Is that truly the blackness we face? Well, that is hard to say, the fact that this act relies on ambiguity and is lacking certain rules of restraint, or at least certain safeguards so that data cannot leave the intelligence office is reasons enough to have a few more discussions on this topic. What is interesting is that CISA would create a fear, which Black phone addresses, yet in similar method other players will now receive an option allowing them to play large dangerous games whilst not becoming accountable, that new Blackphone could address several issues the shady commercial interest guy is very happy to exploit.

The question becomes, how does any of this make us any safer?

So now we get back to the Age of Ultron line. As we see that crime is becoming an orderly event, the fact that we tend to hide in chaos the issues that should be open for all is part of the dilemma we now face. Again we are confronted with laws that remain inadequate to deal with the issues that needed to be dealt with. CISA takes in my view a chaotic approach to keep a level of order that was delusional from the very start, from missing definitions to application of methodology. It is a cog not linked to any machine, proclaiming soon to be of use to all machines and in the end, as I see it will only hinder progress on many levels, mainly because it tries to circumvent the accountability of some. And this is not just an American issue. In that regard laws and the protection of the victims have been an issue for a longer time. We only need to look to the Tesco grocery store on the corner to comprehend that part of the equation.

 

 

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September 27, 2015 · 00:26

What news is news?

There are several pieces, not just in the Guardian, the BBC, the Independent or the Times. They all tell us that they have news, but do they have any actual news? The Guardian shows us a tech article (in the Tech section) called: ‘the node pole: inside Facebook’s Swedish hub near the Arctic Circle‘, all innocent news, one could surmise that it is just a space filler. Or was it done to give extra view to the article ‘Facebook is making more and more money from you. Should you be paid for it?‘, or perhaps to give extra light to ‘Facebook case may force European firms to change data storage practices‘, which I gave my views on in my previous blog. You decide!

In the business section we see VW to get some centre stage, which makes perfect sense and that is just the Guardian. The independent also has a go at Facebook, but now has a go at its users, well, actually it is not the Independent, but the employee tribunal. Now the article shows all kind of signs of bullying, which is never OK and in that regard Rachael Roberts has a real case, but in light of the events, Mrs Bird does not seem to be a friend of Mrs Roberts, so why is the act of unfriending on Facebook the killer? Yet it is the quote “But employment lawyer Josh Bornstein told ABC news the unfriending incident was found to be workplace bullying in the context of several other issues“, which baffles me, if they are not friends, one or the other could unfriend the other party, that part seems clear cut to me, not bullying. So out of the 18 allegations of bullying in total, the unfriending in Facebook took the cake? It does not add up to me!

In addition we see two whole articles on Facebook being down and oh yes, the new iPhone is for sale! Let’s not forget the fact that the iPhone now allows for sextracking. So, parents buy your boy or girl on of these bad boys so you can find new ways on how you are about to become a grandparent! Really? You need to keep scores on your phone now? Didn’t Ashley Maddison teach you anything regarding sex that is on the internet, everyone will know soon thereafter?

Finally they also gave visibility to ‘Hospital apologises for removing RAF sergeant from A&E because uniform could ‘upset’ patients‘, which is a can of worms in its own right. In that light I expect the NHS to move all drug and binge drink casualties to their basement as not to invoke bad thoughts from the Presbyterian community. How insane was the idea to move a wounded RAF sergeant in the first place!

All these events, some are actually news, but no one seems to have any balls. No one is looking at Pricewaterhouse Coopers. Which of course ties in nicely with the words of the Dalai Lama ‘Dalai Lama on Britain’s policy towards China: ‘Where is morality?’’, the answer might not be such a high moral one, it goes a little like “Who is willing to suck the smallest extremity for the good of one’s career?”

To some extent we can accept that the SFO is silent, only to the smallest extent. You see Tesco is dealing with a write-off of £6.4bn, which of course is massive. We have seen all the news on how some former Tesco entities are getting grilled (as they should) but the press on many levels in many nations keep on rehashing the old news and no one is digging into PwC. No one is digging there. Does that not sound awfully weird? Yet here is the kicker, we see more and more messages like ‘Multinational tax avoiders targeted’, with quotes like “while the American Chamber of Commerce in Australia warned about throwing up new hurdles in what is already a high-cost economy. The chamber’s board includes representatives from ConocoPhillips, GE, Boeing, PwC and Exxon Mobile“, yes it seems it is never a good time to go after tax avoiders (not to mention the impact it has on the bonus benefits for those working in that part of the financial branch).

Before you whisk this away as mere banter (which you are of course allowed to do), take a look at this article that is a little over a week old. It is from the Wall Street Journal, which I do not look into too often. The article (at http://blogs.wsj.com/cio/2015/09/15/the-morning-download-identity-theft-key-to-attack-on-cisco-routers/) called ‘The Morning Download: Identity Theft Key to Attack on Cisco Routers‘, starts with: “Good morning. The international attacks on Cisco Systems Inc. routers, disclosed earlier today by security firm FireEye Inc.’s Mandiant unit, began with the theft of legitimate network credentials. Securing and managing the identity of network users continues to be a massive challenge for CIOs and CISOs and ultimately, the CEO and the board. The attacks have been named ‘SYNful’ because of how the malicious software moves across routers using their syndication functions “Cisco said SYNful did not take advantage of any vulnerability in its own software. Instead it stole valid network administration credentials from organizations targeted in the attacks or by gaining physical access to their routers,” Reuters reports today. Mandiant said in a blog post that it had found 14 instances of router implants, which replace Cisco’s operating system”

Now, to complement that statement, I will add the following. On June 5th (more than 3 months before the WSJ article), I wrote ‘In reference to the router‘ (at https://lawlordtobe.com/2015/06/05/in-reference-to-the-router/) , here I stated: “Soon thereafter no more firewall, no more routers, just the bliss of cloud servers and data, so much data!“, which reflected on the article I wrote on February 8th (more than 7 months before the WSJ), there I wrote “I think that ‘hackers’ have created a new level (as I mentioned before). I think that Cisco IOS was invisibly patched“, (at https://lawlordtobe.com/2015/02/08/the-next-cyber-wave/). I was literally accused by some to be insane, there was no way that this would EVER happen. Now we see in the Wall Street Journal: “Mandiant said in a blog post that it had found 14 instances of router implants, which replace Cisco’s operating system“, interesting how I am now proven correct. Are the members of the Baboon family (usually found in the FBI) reconsidering their North-Korean option? Let’s face it, this took top level skills, we can (as I pointed out in the past) find those boffins in the US, UK, FR, the FSB and Chinese Intelligence, however in North Korea not that much!

The Reuters article shows a lot more (at http://www.reuters.com/article/2015/09/16/us-cybersecurity-routers-cisco-systems-idUSKCN0RF0N420150916), however, they are just rehashing something I stated for almost a year, the quote ““That feat is only able to be obtained by a handful of nation-state actors,” DeWalt said, while declining to name which countries he suspected might be behind the Cisco router attacks” adds to my view that I was correct all along (finally another ‘I told you so!’ opportunity). The only difference is, is that DeWalt includes Israel, I have no real quality data on the Israeli cyber capabilities, so I am willing to give him that one. Finally we should consider the quote “Infected hardware devices include Cisco routers 1841, 2811 and 3825“, which is fair enough, yet in my article I offer the option that the CF unit found in nearly EVERY router could also open doors, so the danger could in theory go far beyond those three routers.

I also stated that my thoughts were based on sound speculation. You might wonder what sound speculation is. Basically, it means that even as I might not have them skills to program, I do understand that my solution is viable, the fact that routers are getting programmed with a new OS is clear evidence of that. In addition, it also gives weight to two infestation systems I speculated on as well as the weakness that those believing in the cloud are not realising at present. I was willing to look beyond the veil, a side everyone ignored. Yet when a router can be reprogrammed to the extent it was, also clearly means that data in motion is no longer safe, which means that pretty much any cloud data can be gotten too, the user only has to access the file to make that happen.

I even had a thought on dealing with the Iranian glow in the dark power plants when the time is there, just by thinking out of the box. It does involve a Piranha valve (which actually already exists in name, but mine is so much cooler). None of this is newsworthy, speculative opinion one might state. Yet in my speculation, I have shown solutions to be real in several occasions and in addition to that I also clearly outlined long before the press decided to show the minimalistic amount of balls (read testicles), that a look into Pricewaterhouse Coopers was adamant. It seems that apart from a December 2014 message from the SFO (rehashed by nearly all papers) not much happened, apart from that news, the press at large stayed clear of mentioning PwC and Tesco in one sentence. Is that not utterly weird?

Of course the luggage of someone’s mum in Tenerife (shipping at £122) gets front seat exposure, yet, the issue on £6.4bn getting lost due to assistance (better stated too weak opposition) by Pricewaterhouse Coopers seems too trivial to keep pressure on. Way to go Consumer Champions, Money! I actually mean that! They did do a good job and they have done so in the past, yet I fear that a letter by Dave Lewis on how his firm lost £6.4bn as the keeper of his books was not prudent, or is that tenacious enough to ring that bell very loudly when things looked too odd. Will Consumer Champions find that money? Will they write “Pricewaterhouse Coopers must accept responsibility for the signing off on books as the “accountant”?” Consumer Champions might not get this done, which is fair enough. It should not be on their plate, but the parties this should be very visible on are also not doing anything as far as we can tell, they remain silent, they remain this silent after 9 months.

Yet in all this there is one part both the Guardian and the Independent are getting right. It is the news on the NHS, there are massive problems and knowing them all is essential in finding a solution. In this matter the press has played a good role. In my view exposing former and current politicians a little more on the political game they play, so that we all understand that a proper solution is needed and taking the politicians out of that equation might not be the worst idea, the end result stays the same, the NHS is now too close on the edge of collapse to be acceptable, yet where lies the solution? Although I understand the issue the Independent shows, I partially disagree. The headline ‘New NHS junior doctor contract would discriminate against women, senior medics warn‘ is not incorrect (at http://www.independent.co.uk/life-style/health-and-families/health-news/new-nhs-junior-doctor-contract-would-discriminate-against-women-senior-medics-warn-10516885.html), yet in all fairness, the quote “Under the new contract, trainees who decide to work part-time would see their pay increase more slowly than their colleagues” is a can of worms! Why would my co-worker doing 32 hours get the same raise as myself working 60 hours? (Remember, I am not a doctor). A choice was made! Yet, there is a level of fairness here too. Which means that to tackle it should be done in another way. Even as there is a shortage, the burnout of physicians is a known issue and making a maximum of 40 hours a week a mandatory status could be close to the only solution. Perhaps we have been too indulged, perhaps some options should only be there during the week. Perhaps the change to healthcare is essential (like hiring 40% more staff), but we also accept that at current not one government remains to afford that change (well perhaps Easter Island where there are less than 10 doctors). In the end the system has been ignored for too long. Too many politicians are on the ‘let’s get the computers up and running‘ whilst they know that staff will remains a problem for a long time.

That is news! That is what matters, but too many papers and too many news broadcasts are about the emotions and not the actual news that matters. That might be an incorrect view and a very biased view. It might be that some news is more important than other news parts, I will instantly agree, yet in all that the complete silence from pretty much all the papers regarding Tesco and some involved book keeping parties remains a mystery to me, how is that part not news? We will see more events that will not get the proper light in newspapers, both in paper as well as online, I’ll let you decide how that measurement applies to an involved party to events that started a £6.4bn downgrade.

 

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September 22, 2015 · 22:11

In Greed we trust

In greed we trust, all others are expected to die! That is the basic setting which is now ruling the internet and it all started when the CEO of Turing Pharmaceuticals AG bought the rights to generic drug Daraprim and he subsequently raised the price by 5500%. This now creates two parts. They are:

  1. How is this legal?
  2. How to prevent such dangerous situations?

The initial part is not found. You see, when we look at the definition of Financial Exploitation, we get: “Financial exploitation occurs when a person misuses or takes the assets of a vulnerable adult for his/her own personal benefit. This frequently occurs without the explicit knowledge or consent of a senior or disabled adult, depriving him/her of vital financial resources for his/her personal needs” (source:  National Adult Protective Services Association (NAPSA)). Most forms of protection against exploitation is against what people own. One of the most famous cases in Australia is Commercial Bank of Australia v Amadio (1983) 151 CLR 447; [1983] HCA 14. Yet, the law regarding exploitation of something that is not owned is not clear, in certain places we see that in the Generics and Biosimilars Initiative Journal (GaBI Journal). 2012;1(3-4):146-9. The title of the PPRI conference reports gives us this with ‘The potential of generics policies: more room for exploitation’. The tactic is quite sound, if the price of normal medication cannot be lowered, than raising the price of generics is a sound strategy from the view of the greedy. The paper also gives us “Mr Richard Bergstrom, President of the European Federation of Pharmaceutical Industries and Associations stated that ‘once patents expire, prices should fall to a low, but sustainable, level’. In this panel discussion but also throughout the conference there appeared to be a common understanding that generics competition works well”. This was a view stated almost 3 years ago, which is true. However, the solutions that are addressed to a 2% or even 1% market does not seem to have too many alternatives, this is where the solutions like Daraprim and Cycloserine seem to come into play. The older small solutions that have no equal because the need is too small, now a massive option for larger profits.

When we look at Bloomberg on August 6th, we get: “Allergan Plc’s Actavis unit got a subpoena from the U.S. Justice Department seeking information on the marketing and prices of its generic drugs, becoming the biggest company yet to draw scrutiny in the government’s widening antitrust probe of the industry. The June 25 subpoena also sought information about communications with competitors regarding the products, Allergan said Thursday in a filing. While the company didn’t supply further information and didn’t specify the competitors, rivals including Lannett Co., Endo International Plc, Par Pharmaceutical Holdings Inc. and Impax Laboratories Inc. have made similar disclosures in the past several months“, as well as “Some 10 percent of generic drugs doubled in price between July 2013 and June 2014, and half of all generic drugs rose in price, according to an analysis earlier this year of Centres for Medicare and Medicaid data cited by Senator Bernie Sanders, an independent from Vermont who’s running for president, and Representative Elijah Cummings, a Democrat from Maryland”

So as we see these events, why did Martin Shkreli make this move? An entrepreneur of his achievements does not play around. What is his game?

The ‘defence’ we see from the other side is “Shkreli said: “We need to turn a profit on the drug.” He defended the decision by telling Bloomberg News that newer versions of the drug needed to be developed and his was the first company “to really focus on this product” for decades and that such research was extremely expensive“. This goes against the statement he later makes, which was “He also promised that: “If you cannot afford the drug we will give it away for free.” Shkreli also said the drug was currently under priced” (source: http://www.theguardian.com/business/2015/sep/21/entrepreneur-defends-raise-price-daraprim-drug).

Now we have an issue with all this. Is this about the medication, or is this a first step to bleed dry health systems?

For this we must show one additional quote. It is “Shkreli’s start-up company, Turing Pharmaceuticals, acquired Daraprim in August. The drug was first developed in the 1940s and is used to treat toxoplasmosis, an infection that is not common but is particularly dangerous and can be fatal“. The question in my mind is how this existing drug is any form of treatment against the complications of AIDS? A drug that is over 60 years old, which is suddenly the foundation towards a cure? What are we not seeing? Well, that part is shown by CNBC (at http://www.cnbc.com/2015/09/21/drug-prices-big-price-increase-for-daraprim-rescinded.html). Here we see that this is the second act. The first one was “Cycloserine was acquired last month by Rodelis Therapeutics, which promptly raised the price to $10,800 for 30 capsules, from $500. But the company agreed to return the drug to its former owner, a non-profit organization affiliated with Purdue University, the organization said on Monday“, after which the price ‘stabilised’ at twice the original price. So is this about a changing approach to the increase of generic medication by 100%-300% in the end? In addition, the other CNBC quote is “However, outrage over a gigantic price increase for another drug spread into the political sphere on Monday, causing biotechnology stocks to fall broadly as investors worried about possible government action to control pharmaceutical prices. The Nasdaq Biotechnology Index fell more than 4 percent“, now this is all starting to make sense. A hedge funds manager playing the market and playing the waves of market exploitation. This is not unheard of, more important, for the most, we could argue that no illegal acts were undertaken. The Guardian stated “It is not uncommon for companies to use inventive interpretations of government regulations and loopholes in the law to corner the market for certain drugs, especially ones that were developed a long time ago and have only a limited market“, which is true, but when we considered the additional event that the Guardian ignored, give us cause for concern. I am not stating that the Guardian is trying to misinform its readers, their conclusion on one case is sound. Yet, when we see the addition that came from CNBC regarding Rodelis Therapeutics, we see another side. Here we see a side of market exploitation and Market manipulation, as far as I can tell at present in a very legal way. That we see from “Mr. Hasler said the new price was needed to stem losses”. Really? So is this about feigned losses, or is this one of many steps where drugs that treat smaller populations to grow 100%-300% in price to assure a market niche that most NHS systems (US, EEC and Commonwealth nations) are unable to fight. In this way on an international level the respected NHS versions will be placed under additional pressure. As I see it, Martin Shkreli has started Turing Pharmaceuticals AG to dig into this very profitable branch. In addition, for something this expensive, how come those rights transferred for only 55 million?

It seems to me that parts in all this remains unstated. Why?

Now in this part I am not having a go at journalists as in the past. For one, this is an evolving story, in the second part there are a few sides to all this. For one, I am speculating in what the game is here (speculating is not now, nor should it ever be regarded as factual). In addition there are sides that have not played yet. One of these sides is the law. As I personally see it, certain entrepreneurs, wealthy or not are now trying to corner the 2% treatment solutions, perhaps even the one percent group. Consider how this affects the UK. Let’s use the UK statistics. When we consider 240 million patients a year. If 2.4 million people require a drug and if that price suddenly goes up from $500 to $1000 (the Cycloserine example). This is only in the UK. Which gives them an additional 1.2 billion and this is only ONE nation, now consider the effect on the EEC as well as the US and the other Commonwealth nations, now the money becomes really handsome. Even at 0.1% it is a massive influx of money and for now all very legal. I have full faith that the law will be adjusted, yet we will see that it will be adjusted too late and some of these fast moving rascals will have made a massive additional amount of money, which is not an illegal act by the way.

This whilst I am still slaving over my issues of Infringement. That and a massive student loan will not propel me whilst some dubious hedge funds individual walks away with billions. A clever mind is half the battle!

So as this event escalates, the UK will have a new problem, because as is, the prospect stated ‘Planned NHS expenditure for 2015/16 is £116.574bn‘ is possible off by no less than 10%, the generic pharma side is only one side. I wonder what happens when these ‘entrepreneurs’ acquire the service contracts of hospitals at large, what happens when the MRI contracts are sold off to third parties? What happens when those prices go up? This is a path that Stadium Group CEO Charlie Peppiatt seems to be walking towards in a very successful way. As one third of the planet goes into ‘one foot in the grave mode’ that population will require a massive amount of support in medical terms (until they move towards their respective casket or urn). There is one side that is an issue for the other players. As I see it Martin Shkreli might be the most visible one but as I see it not the brightest (massively richer than me though), in one bash he has given visibility to a move that many wanted to keep under wraps, because out of sight, out of mind and that would have resulted in profits (loads of it). The visibility forced on the eyes of many might now result in NHS safety valves that could stop the forced squandering of funds. I wonder if my view is correct and more important will proper steps be taken sooner rather than later.

I’ll let you decide.

 

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September 20, 2015 · 12:57

The Game of Patent Law

I am in a very weird place. I must admit that I have not been in the brightest of spots. I am struggling with this semester’s subject. Even now, I am still studying too. I stopped writing on notes and going over lectures because I needed a small break and because my mind has been telling me stuff I did not even realise.

You see, this all started on two parts. The first was ‘Person Skilled in the Art’. I looked at it from many sides, but I forgot, no, lets state, I did not completely comprehend the legal part in all this. You see, Wiki tells us ‘If it would have been obvious for this fictional person to come up with the invention while starting from the prior art, then the particular invention is considered not patentable’, which might not be the most academic view, but when we consider the more ‘academic’ part we get “In these fields the persons skilled in the art are not just skilled artisans. They are often trained engineers and scientists, who are well versed in the periodical literature of their subjects“. This we get from the case Sunbeam Corporation v. Morphy-Richards (Australia) Pty Ltd [1961] HCA 39; (1961) 35 ALJR 212. Here Justice Windeyer referred to this in [218] “scientific inventions, intricate mechanical arrangements, chemical processes, electrical and electronic devices and so forth”

You see, part of this is my issue (truly an issue I have). It comes in two parts. The first one is a memory from my early secondary education. We once had a discussion on Art versus conceptual art. It never made sense to me because I regarded both pieces as art. In some view we see that conceptual art focusses on the involved idea in the work takes precedence over traditional forms and material concerns. But is that true for some? Art is art no matter how you slice it. This has been in the back of my mind for a few days. At work in the last week I would listen to the soundtrack of Mass Effect whilst working on parts I was working on. I thought I was just trying to listen to music. No! My mind was kicking into high gear trying to make me see something and after this weekend, after 16 hours of re-listening to lectures and retrying to do what I could not do before, at roughly 10:18 it hit me! It was all connected, I suddenly got the gist in a scary way (because I get a first glimpse on how to solve it).

I need to get back to that ‘skilled person‘ because that is actually at the centre and it all links back to mass effect. In my view Mass Effect is one of the most brilliant pieces of work, possibly ever! The story is captivating, the graphics are amazing and the entire project is out there and I mean out there on the far horizon. Most gaming (me inclusive) always seek to look to the next challenge, the next big game. We almost forget the great games that got us here. Yet, Mass Effect always remains. My Google+ profile still has the launch party photo. In all this, the game was a breed apart.

So, how does this relate to the law?

This is part of the issue I have, especially with Justice Windeyer stating “In these fields the persons skilled in the art are not just skilled artisans. They are often trained engineers“. This has been my issue for a long time. You see almost two years ago, I wrote the concept for Elder Scrolls 6 (Restoration) and send it to Bethesda for their consideration. Not just more or an addition, no an entire new approach. In that same way I have bene able to reengineer in my mind every game I ever played. Now I am not a programmer, so making it is another issue, but my mind can see the game. Improve upon it, mould it into more, within my mind. The ability to see past the game, into the engine, the design and the story has been forever with me. Which was also the part that is stopping me. It is in essence the issue I have had with Ubisoft and Yves Guillemot regarding the dwindling of the Assassins Creed franchise. That is not even addressing the issues (read glitches and bugs) AC Unity and Far Cry 4 has been subjected to. AC Syndicate is now less than 4 weeks away and its predecessor have given a massive blow to the franchise. I saw some of these issues for a long time. Many things have been in there for 5 generations of the Creed, so if I can spot them, why can they not do so (or fix them before release for that matter)?

You see, here we get the PSA, here I get the block that Justice Windeyer (et al) bestowed upon me.

This is exactly where my problem is and yes, it is just me. I am not blaming anyone else. I never truly understood ‘Person Skilled in the art‘ (yes, it took me a while to figure that out), which means the rest became up for grabs. Yes, I comprehend the definition and I understand the premise, but when you can reengineer whatever you see, you (in this case me) tend to miss the point.

Now, in that continuation, how can one dissect “a pair of spaced apart slots in the first end portion each slot extending from an edge of the first end portion to half way across the first end portion; the slots being parallel to each other so that they and their projections define a pair of parallel axes extending across the first end portion, along the sides of the stem and across the second end portion” In case you were wondering, this is part of the description for an applied sheet of metal (I never knew my mind could project so many question marks).

Here I see myself like in Abbott Laboratories v Corbridge Group Pty Ltd (No 2) [2001] FCA 810. At [56] we see “I regard Professor Guilbault as quite unlike any person in Australia for the purposes of this case.  He is, and was at the priority date, a real expert in the field. What may have been obvious to him gives no indication as to what would be obvious to the ordinary skilled but non-inventive worker, even leaving aside geographical considerations“. You see, my ego rejects that part, because I am not a professor, I never considered myself to be ‘unlike any person‘, yes I consider myself to be an expert when it comes to games, but not to the extent the case made Professor Guilbault to be in his field, which gave me the issue of not grasping the level of the skilled person.

I am catching on (even though some parts are still really hard), but I have the rest of the day and 5 evenings to catch up with what I was not grasping. I am getting there though!

It still is an issue on how to set certain things, which is why my timeline differs. All this now shifts back to the games. I spoke about Mass Effect. The first game had an issue with the drive, but when we consider the first 360 systems (some people relied on a console without a hard drive, go figure). They got to play the game. The game was also one of the first to be decently open world, so that means that certain trigger points needed to be created. Which is what we saw in Fable 2 and 3. When you realise this, you can work around them. They are of course games and not real life, so the point shifts. Yet, in all that Mass Effect had an issue with achievements it never really fixed. I ignored it (but was a little miffed to miss out on achievements I should have gotten). Mass Effect (apart from the glitches) made a game truly replayable, which makes for more joy, yet unlike Fable 2 it did not create cosmetic alternatives. In all that, who (without cheating or hint guides) knew you could get to see Tali? Mass Effect 2 went even further in all this even as the game is still mostly the same, you can replay in another role giving power to replayability. Mass Effect is one of the only series ever to pull it off to this extent. So, yes, Mass Effect had issues (and glitches), yet the overall issue people had was with the ending. I less so when you realise the story in its totality, but the last one was a little sloppy in places. I saw through all that. So am I a nagger, a person skilled in the art, or am I beyond that? I have been around since before the VIC-20, so I know my games. In all that Mass Effect 3 amazed by offering the best multi player environment I have ever participated in (still not surpassed today).

Here is the kicker where does that leave the other game designers? In the mind of many we see that good gaming might start with replication, but the visionary evolves that into innovation and offer something totally new, something we all desire to play. I think the game Evolve is almost there. It is close to what Mass Effect 3 was, which is also dependent on a great AI and even though the levels in Evolve are bigger, you are still basically in a ‘cage’ with the big nasty. In all this Ubisoft is not sitting still. Although no personal evidence at present, as far as I can tell, from what I saw their new upcoming title ‘For Honor‘ is showing to innovate multi player from what was into what others desire. This is a very good thing! Jason VandenBerghe seems to have figured out what the big players were either not comprehending, or basically were ignoring. Now I am not one for hack and slash, I am not one for melee games, but I can stare in awe at the achievement of innovative gaming. This is what we will get in 2016. Perhaps Sean Murray (No Man’s Sky) wakes up one morning and realises that keeping people in the dark is only short term acceptable, but that is a lesson he must consider by himself.

Back to the innovators. One of the considerations with a person skilled in the art is: ‘A PSA would be likely to access and search IP Australia’s patent and design databases or get someone qualified to do it for them before releasing a new design of a ladder into the marketplace even though the level of technology is relatively low‘, this could be shaped into ‘A PSA would be likely to access and search IP Australia’s patent and design databases before releasing a reengineered design of a ladder, sufficiently distinct from the original into the marketplace as an innovative patent regardless of the level of technology required‘. In my mind I wonder how much power those with the ability to reengineer can hold, those who can see and value the originals for what they are. It is a legal trap to some extent, because the patent has protection under ‘they are more similar than dissimilar’, the registrar will take that into consideration and when it does go to court it will be an issue to argue, which is why I foresaw the evolution of mobiles, not in hardware, but a mobile generic base that is not unlike a stem cell approach, the software will shape the actual device and now we have two issues. Many nations are not have or reject more often software patents. Some state “The rapid decline in software patents is a huge boon for innovation“, yet in hindsight, there is another issue. Yes, I am all for innovation and bring it on, but not unlike Assassins Creed Unity it becomes more about the now and more about the quick sale and not about the quality of aftercare. As we move from a quality product to a short term choice, how do we fare? Is your budget ready for the annual purchase of a mobile? This is linked to all this, it is not just the Person Skilled in the Art, or the Person Skilled into the reinvented art. As we move from art to conceptual art, we also move from the finality of a choice to the transient of what might not become (again that assassins game comes to mind). All these elements move us in a direction that I regard as dangerous, we move from creators to innovators. Which was always intended to be a move that evolves into true new creators. No, now we move from creators to cheap solutions, something patents were never supposed to do, the person skilled in the art is the push we did not tailor to. I am evidence of that. I could never keep up with Richard Garriot or Peter Molyneux. Even when we spoke I saw their minds moving on to really new things, not iterations of the ‘what is now’. That is what corporate greed got us. A move away from the future. Even if we consider the computer as hardware, the timeline from the 8088 to the I7 now. The processors are no longer truly new, just slightly faster. A market controlled desperate to hold on what they have and not to lose it. That is not how the 80286 came to fruition, in that Mass Effect from game 1 trough game 2 to game 3 made jumps, not mere steps. You only have to replay the first one and the second one to see the leap we got. Assassins Creed showed the same in the original and 2, what came after became steps towards iterative work, iterative work is not innovative, which is why the small indie developers must be protected, if we are to move forward we have to protect true futures instead of orchestrated options.

Here I am still deliberating Person Skilled in the art where Lord Diplock states ‘a patent specification is a unilateral statement by the patentee, in words of his own choosing, addressed to those likely to have a practical interest in the subject matter of his invention‘ and the subsequent resolution by Lord Justice of Appeal Waller ‘a man concerned with the construction of a steel lintel to whom the use of the word ‘vertical’ would indicate precision‘. Here I find the issue with both parts, the second might be overruling the first, but the protection, or at least the approach from a malicious side gives pause to vertical could imply accepted to be ‘cheaper’, for if the engine is not tuned to be finer, it will be constructed to be cheaper, life has shown us that in the iterative part, which is part of the mess we now face. In my view the law must lead but it adheres to the view of those who get to speak, which are the people who have the established base of wealth. The true innovator who moves to creation is never that, so the future is tainted by those who have, they either own those who try to push forward and they then adjust the push for maximum wealth, or they buy out those who they do not owe and again they get to control the product.

The game of Patent Law is harsh, difficult and rewarding, because Patent Law was to be a fair field and in that it still is, the world around the law has changed. I am still trying to get the materials and pass this subject, but I also wonder, what can the law do to keep the field fair? In my view, the law has addressed some parts, but the issue where innovation is too often replaced with iteration (pharmaceutical patents for example), how to address that part?

Well I am off to lunch and after that redo my parts on infringements, which would go further if I did not get stumped by texts like: “Further, because the edges at either end of the column neatly align with one another a plurality of such columns of the same height can be suitably employed on an even surface to stably support various objects including a coffee table top or barbecue plate without rocking, for example. The column structure can also be used by itself as a tree guard“.

Life might be a game, but patent Law is not the clearest of rule books to define it by.

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September 13, 2015 · 22:40

The choice of a new religion

The Guardian had an interesting article yesterday by none other than Alex Hern. He and I look towards the gaming world in very different ways, it does not make him wrong and it does not make my view right. We have at times different views on things. That is the wonderful world of gaming, it is one of the few fields where the approach to any solution tends to be almost artistic, many views, none the same can still warrant true correctness or success. In ‘Apple wants the Apple TV to be a games console. But can it be trusted?‘ (at http://www.theguardian.com/technology/2015/sep/12/apple-tv-games-console-can-it-be-trusted), which is a very true piece. The subtitle states ‘Apple would like to see its new set-top box become the next Nintendo Wii. But it’s questionable whether the company really understands gaming‘, which is as true as it gets. I have been ‘connected’ to Apple systems in one way or another since 1990. One thing from the very start is that the Apple systems were always ahead in many ways, even in artistic ways, yet true gaming was never supported to the extent it should have been. One of my very first freelance jobs was to take a look at ‘Balance of Power’ (by Mindscape), I ended up checking it on the Mac as well as the Amiga. Another one was Shadowgate by the same makers. Even though these games were always worshipped, but on the Mac they seemed to be on the side, accepted as in existence, but never truly part of the ‘Apple’ environment accepted. It is hard to get it into words. You would have had to be there to understand it.

The quote “The problem is that games are treated as just another type of app by the company – albeit a very profitable type. The games store, for instance, is organised in exactly the same way as the rest of the app store, with prominence given to a few select apps and then three charts of top-selling paid games, most-downloaded free games, and “top grossing games”“, helps here. It is like a bunch of economists see games in the spreadsheet as deep green and those economists really like deep green (as in profit). Yet games is a lot more than numbers (something Ubisoft has an issue with too). To see Apple people look at games and advice their users on is like going to your accountant for sex guidance. That person gets off on spreadsheets and a balance books, for many people not the orgasmic solutions to embrace. Yet there is also a side where I have to disagree on.

Part one is “Similarly, in the newly-released guidelines for Apple TV apps, the company reveals that “the maximum size of an Apple TV app is limited to 200MB”, with no persistent local storage. In other words, apps must be lean, and they must download everything they show from the cloud“, part two is “The top-tier consoles right now ship their games on Blu-ray discs, which store at least 25GB and can rise to 128GB per disc (twice the total storage of the highest-capacity Apple TV“. Now, Alex speaks the truth and he is 100% correct. My issue is that quote 2 implies (he never really states it anything in that way) that size makes the game, that is wrong. Still there is a truth here. 200Mb is nowhere near enough for any decent game. If we look at previous games, like Metroid Prime on the GameCube, that game exceeds the 200Mb. Many games from the PC could get close to the 200Mb, but will in all likelihood exceed that part.

In addition, the statement “In other words, apps must be lean, and they must download everything they show from the cloud“, which now implies that we are all dependent on quality connection. A property that is even debatable in parts of Western Europe, the US, Canada and Australia. For Apple it must be good to know that at least Scandinavia and its 18 million people will see the bulk of Apple TV gaming. The second issue is “Unlike PC games, consoles have always been fairly locked down by the platform manufacturers. In a way, it’s “no sex, no drugs, only rock and roll” attitude is merely replicating the same approach that Nintendo has emphasised for years in its efforts to keep its games consoles family friendly“. Now I am all for family friendly games, yet some people want more than Mario Kart. Some want to play the master Sergeant (HALO). Some want to be in the wasteland (Fallout) or they want to sneak their ways around a city (Thief). Many of these games would never be allowed, with a massive portion of the gamers being 21+, they end up being nothing more than a nuisance to Nintendo and without a massive arsenal of IP that will not happen any day soon.

It is the final quote that is concern as well as the source of howl of deriving laughter “But its success as a games console would be handing yet more control of the medium to a company which fundamentally looks down on games and gaming. And that should concern anyone who likes to play“, wasting this level of resources on a system with no expertise on quality gaming will put a dent in the Apple coffers, in addition, once rejected by gamers, those at the helm will be forced to take a harsh look at their choices and their considerations. It seems that so far in new gaming only Elite Dangerous made it. If the iMac 5K would have one additional hardware update. If they had something in equal or exceeding the Radeon R9 295X2, the system would become something to behold, not just with Elite Dangerous, but in addition with games like No Man’s Sky (if it ever gets here). The iMac would be an option, the Apple TV is clearly not that option, beyond Minecraft there is not a lot that plays on the Apple TV. So do I disagree with Alex?

Actually no! When we consider his quote “Despite my concerns, there is the chance that the Apple TV could be good for gaming“, it connects to my thoughts that good gaming is not about the size (well not completely). Consider that some of the games that were a massive success on the Commodore 64, the Commodore Amiga and the Atari ST can still be the games in the new generation systems like the Apple TV. The games by Sid Meier, games like seven cities of gold, some of the legends like Lemmings, Dune 2 (Command and Conquer), pretty much most of the games Peter Molyneux made (including Dungeon keeper), there are loads of other games. The opposite is also true, now we can get a pirates game Sid Meier could never offer when he did because technology stopped him. In equal measure quality gaming has dwindled as there are no limitations, so that game designers are no longer trying to squeeze the maximum out of a console. Tomb Raider is an example here. When we consider that Apple TV could get a market, whilst the hard core end games on consoles and PC remains, I state ‘Yes’, that is a definite option. Yet Alex does illustrate a side of Apple that the foundation of Apple should be ‘concerned’ with. “If you want to criticise a religion, write a book. If you want to describe sex, write a book or a song, or create a medical App. It can get complicated, but we have decided to not allow certain kinds of content in the App Store”, in all fairness there should be space for that approach, but it will hinder your business. You see, the guidelines at 15.1 state “Apps portraying realistic images of people or animals being killed or maimed, shot, stabbed, tortured or injured will be rejected“, which is nice but that pretty much sums up almost every game ever made, including New Zealand Story, where the little Kiwi loses health when he touches a spike. 15.3 makes any WW2 game a non-starter, unless Apple insists that Nazi Germany was never a real government where my response becomes: ‘good luck with that one!’

So, even though we can accept that guidelines are needed to keep certain groups (read children) free to wander on the app store selecting games. I get that, but as I stated before, it limits the Apple TV to the realm of Nintendo who already has a massive grip on its user base through several means, why would Apple TV wander in that field? It almost reads like Apple wants to add to the foundation of a failed system. The idea that was a write off in 2007, regarding a big fat fail in 2010, suddenly got the title ‘How Apple’s biggest failure could be one of its greatest accomplishments‘ in 2014 (at http://www.dailydot.com/opinion/saving-apple-tv-think-different/) we see: “Apple has a chance here to beat its competitors to the punch, first and foremost, by making sure that you can play every significant type of video file type that Apple TV doesn’t offer now. This will broaden the range of apps the device can support, and ensure they never have an issue like they did with Hulu again. They would also be wise to create a browser for the device, and to let users access its hard drive“, which is true, yet the article reads like a marketing approach to ‘new’ options for Apple TV and now a year later we see the games ploy. Is it truly about that, or is there a fear within Apple that they are being passed by, passed by those who had a clear goal and by growing in any direction they get to hold onto non-write-off a little longer.

I will let you decide on the parts that are a given, but are they truly a given? I must warn my own view that it is tainted and also clouded. There is a view that comes from true gaming and as such Apple TV does not add up to much, yet what is small can grow and as I stated, let true innovation grow through limitations. It gave us true pearls on three generations of consoles, innovations that seem to be missing in NextGen. Yes, there is still innovation, but not to the extent there was in the past. The idea that Apple starts it up again is partially pleasing. Pleasing because that is the one part that have been downplayed by Microsoft, Sony and Nintendo to the larger extent, if you doubt that, then look at how many independent productions made it to consoles in the past. The fact that this year is a lot more about independents is not a given, it is a fab and no guarantee exists that independents will make it through in 2016 and 2017.

That is the part where Apple could grow, you see I personally believe that the next 12 years will be all about the small innovators. As larger players have become vultures, eating the small ones and carrion eaters as they devour their brands in the insane vision that growth comes from interactive innovation, large jumps are ignored. You only need to see the success of Markus the Notch and Minecraft to see that I am right. Will Sean Murray be the next one to show this? David Braben is on the right track to do so too and they are not alone. Even though Everybody’s Gone to the Rapture is not likely to be the success others are becoming, the truth is that this game is innovative. Even though in respect to my Tomb Raider view that 10 hours of game play is not acceptable, it would be equally unacceptable to see a 6 hour story as a good thing (source: YouTube). Yet, it is a story and the challenge as such is too small. You only need to look back at the game Portal (by Rob Swigart) to see something a lot larger, even though not in an open world environment, the result as well as the story was truly unique. That does not make the game a failure or inferior, yet the truth remains that the challenge needs an upgrade. Too small, yet remains a true innovation compared what is out there. In all this my own perception is an issue for discussion too. Where is it a given that a 10 hour game is insufficient? I base it on past play and play that some games give, as such 10 hours of gaming just doesn’t hack it neither does 6 hours. Yet all this started with a new religion, one of gaming. not the worship of a controller, or the divination of a system, but the choice of what we believe is to be an open direction, a choice of innovation, because without innovation gaming seizes to survive and we get iteration of a given, in the artsy world gaming exists in, that part can never be allowed to remain in iteration. This is one of the core reasons why the iteration of Assassins Creed, the iteration of Lara Croft the raider of Tombs and Call of Duty will simmer down, will cease to be the cash cows they once were.

The future is all about true innovation in gaming, in that Apple TV could have a space if it opens the doors to independent developers. When we consider the iPad, it has had a nice collection of games and some are truly innovative, in all that IOS has a place and the Apple TV could bring it to the big screen (and I do mean on your TV). In the final part, I agree with Alex for the most, except for the part “a company which fundamentally looks down on games and gaming“. I am not certain it does. It seems to have an approach not unlike Nintendo. Do we look down on them? The question does remain when we see gaming as a religion. It could be the one religion that should be without a bible, which is fair enough, but what about the 10 commandments? Should we not consider some guidelines? Personally I state no, but then again, I started in a world where gaming was born, where it evolved. In all this gaming can evolve within any limited system (consider the 16KB VIC-20), as such any system can bring the joy of gaming, we only need to consider where we take gaming. Nintendo took a direction, there is nothing stopping from Apple taking it in the same direction. In my mind, it should be now and forever about innovation, because that is what draws us to a new game. Consider how Elemental Kingdoms took the concept of CCG and gave it a digital evolution, that is just one of many options, I hope many that are yet unemployed and it awaits the next visionary to create that path.

Who? That is up to the developer that dares to dream and make it reality.

 

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September 12, 2015 · 12:21

The math is off

That was the very first thought I had when I looked at an article in the New York times by Clifford Krauss from September 1st 2015 (at http://www.nytimes.com/interactive/2015/business/energy-environment/oil-prices.html). You see, the article is quite good and very descriptive, so why is it wrong? Is it his math? Are they the facts? First when we look at the title ‘Oil Prices: What’s Behind the Plunge? Simple Economics‘, now I am all for simple economics, I have wielded that bat myself on more than one occasion, still something is off (not just the smell of oil), so let’s take a walk in the proverbial path of black gold.

  1. Oil is finite. Oil does not regenerate and when it is gone, it is gone forever. In addition, most elements that come from oil have a very short lifespan. Add a match and the stuff just instantly burns away, it burns away leaving you burnt if you stand too close. For a long time our usage grew exponentially, at this point the amount of crude oil used would fill a cube sized at 20 miles by 20 miles by 20 miles, so that is one massive cube! Still, when you consider the oil fields and the size of them, those fields tend to be a lot larger, yet overall they might remain largely below a few hundred metres (which still makes for one massive oilfield).
  2. The quote “United States domestic production has nearly doubled over the last six years, pushing out oil imports that need to find another home. Saudi, Nigerian and Algerian oil that once was sold in the United States is suddenly competing for Asian markets, and the producers are forced to drop prices” is an issue for me. For this we need to look at two additional quotes from the BBC. the first one is “US crude oil was trading at more than $90 a barrel a year ago, but now costs around $45. The UK’s Brent crude has also halved in price from a year ago and is currently trading at about $48 a barrel” as well as “US oil production has increased to a record high in recent years as high prices made investment worthwhile” which was given earlier in that same story (at http://www.bbc.com/news/business-34219144), which is only a few hours old. Now consider one more quote that is only loosely related (one would think). The quote is “Techniques such as fracking have helped US producers offset the falling oil price by lowering investment and production costs“. Now let’s go over the motions (or is that emotions?).
  • When an investment is made, there is a tax write-off, that part has already happened! So those costs are ‘gone’ after that it is the return on investment which takes care of the costs and after that profit comes. This is simple economics. I get an income, I pay for the costs and I pay taxation.

    Now what happens when I work at a loss? This happens. Let’s take the example. I have product X, it makes me a £1000. To get this I need to pay for equipment, which is bought and for the time of the loan this will cost me 300, in addition I need people (you know a non-mechanical labour force). Another 300 gone, leaving me with 400. The evil villain Taxman takes his share and the rest is mine. So let’s say I get to live of the remaining 360. So far it all remains simple. Now we learn that everybody has this setup, so now suddenly people are only willing to pay 500, which is an issue. People get payed, yet I have to share with the loan so I lose out largely, the bank loses out some and Taxman ‘you evil villain!’ you lose out completely (so it’s not all a loss).
    This is how it should be. Now consider the equipment. Either the loan owner (or the investor) takes a dive (for now) as the timeline shifts, so there should not be a massive impact. Not to the degree we see. When you see all these oil articles have you noticed how we see these Jack pumps? We see the iconic devise in nearly every oil mention, so why the pump jack? If that was all it is, a 1925 invention would not be the cause of so much costings.
    This is where the first crumb is left. Those connected state that it is no longer ‘profitable’ to get their money’s worth, which is part of the issue. I personally believe that the players have been engaged in an accountancy game for a very long time. In some cases there are of course long term loans, and yes any device needs maintenance and needs upgrades, yet the Pump Jack could run for almost a decade not getting any attention and the oil flows on. Now, we can agree that oil tends to be found in deeper regions, so the pump jack might not be enough. But the press never shows us that picture do they? Now when it comes to pumps, they need maintenance, sometimes not that much, sometimes the need for mechanics is a lot more pressing. Yet these people are not expensive, so even at $45 a barrel, 20 of them buys an engineer for a day and these places are doing a million barrels a day at times, so the money should remain ‘stellar’.

  • What if this is not just about the price? We know there are much more players in the field, but we all tend to forget that oil was always a finite commodity. It is like living on an island like Crete. Prices there fluctuate (I always loved Crete), but overall living there remains close to the same, even better, selling new houses remain at a reasonable high price. If you wonder how correct (or how wrong I am). Take for example the Bermuda’s an island near you. When you look over a longer timeframe, you will see that these places fluctuate like most places, but never to the extent the average price seem to fluctuate on main land. Take Hawaii, everyone is trying to own something there making prices spike. Now consider the fluctuations and how massive they are for oil. Here my first doubt grew. Yes, we all know that cars are more efficient, we know that spending is down, we know all that yet the overwhelming majority of the people need to get to work by car, by bus or by train. All of them require fuel, even the electricity made comes from power plants and not all of them are nuclear or coal based. Which gets us to bullet point point c.
  • other uses. For this we need to look at the Washington post (at http://www.washingtonpost.com/graphics/national/power-plants/), where we see that there is still a massive group of power plants fuelled by oil. Now, the fact that these are phasing out, because of pollution is a good thing, a great thing even, but for now many are not. In case of Hawaii, where 71% of electricity comes from oil run power plants, the statement from UHERO struck another issue. The Economic Research Organisation at the University of Hawaii stated at (http://www.uhero.hawaii.edu/news/view/273) “Electricity prices can be roughly boiled down to the price of oil, which is used to generate most of our electricity, plus price we pay for fixed costs like power plants, the grid and its management. These costs are fixed in the sense that they don’t vary with the amount of electricity generated and consumed. We have record high electricity prices because oil prices remain high“. Even though the page is from 2014, the collapse of the oil price should have been seen on many levels in Hawaii, but it is not (as far as I can tell), so why are prices pushed upwards and is the collapsed oil price is seen as an ‘evil’?
    In my view this is all about the way the books have been kept from the very beginning. Whether I rely on some knowledge I gained from Schlumberger when I worked there in the past. Whether I go from some news article and some academic papers, my view remains largely the same, the numbers do not add up, they never did but until the oil price collapsed no one had a clue how far they were out of touch.

And now we get the final part in this. Another article by the New York Times. This one is also from Clifford Krauss and it was given light on August 19th 2015. The title ‘Oil Companies Sit on Hands at Auction for Leases‘ is part of what I think is only one facet in the entire debacle. The leases are worth gold and if the numbers as stated go on, than the leases are not kept. So is this to frighten the actual owners of the land to sell cheap? How many leases are up for renewal in the next 2 -3 years? More important, what if the owners state that non-renewal opts for other requirements? The quote “the fortunes of oil companies are skidding so fast that they now need to cut back on plans for production well into the future“, Now we add one more fact from Europe. Scottish energy news reported (actual date unknown) “After nearly 40 years of production, the Brent oilfield – which gave its name to the North Sea benchmark – is now mostly empty“. It is not the only one, not the first and most certainly not the last. We can state that no matter how ‘complex’ the decommissioning is, that this is one of the smaller fields (globally speaking). Even as it was only 10% of the UK oil production, an island with a mere 68 million consumers, the field is dry. So what about the other fields? Is this truly just about leases and demand dropping, or is this to maximise accountancy?

I prefer and I am largely wrong here in this instance, but consider the elements I mentioned up to now. I feel that I am correct ‘the numbers do not add up’, I just do not know why, because it is not simple economics. If that were try then the investments would have been paid off, the maintenance of rigs would remain, but the investment dollars would have been a massive ROI many years ago. So as we consider the image of ‘Oil pumping jacks and drilling pads at the Kern River Oil Field in Bakersfield, Calif‘ from the second Krauss article, we must wonder what the article (at http://www.nytimes.com/2015/08/20/business/oil-drillers-sit-on-hands-at-auction-for-leases.html) the quote “The continuing drop in oil prices and low natural gas prices obviously affect industry’s short-term investment decisions, but the gulf’s long-term value to the nation remains high“. Is that so, in my view, thee quote that directly follows “Offshore drilling, particularly in deep waters, is some of the most expensive exploration done by oil companies around the world. Nevertheless, since the 2010 BP Deepwater Horizon disaster that left 11 workers dead and soiled hundreds of miles of beaches, and the one-year drilling moratorium that followed, production in the gulf has flourished“. So even with the dangers to the environment, the mistakes made and the fact that there is such a surplus to it all deep water drilling, the fact that the investment is massively higher from other options, that part continues?

Is that not the big weird?

If there is so much space to work, why set up your fashion store in a nuclear reactor? Because it amounts to the same thing. You go where you can make your fortune in as comfortable a setting, with the lowest risk and the best returns. That part is a given, has been for decades. Only the accountants have a different view where the taxed benefit of having to buy radiation suits overrules the need for clean profit.

The numbers have not been adding up and only recently with the unusual drop in prices do we seem to wonder why.

The final quote to look at is “That surge will partly offset an expected decline in onshore production because oil companies have reduced their rig count on land by more than 60 percent since last year“. Why? if it is running, as the oil is coming up, it is just going on nodding like a horse’s head, filling up barrel by barrel as the mechanic sleeps until one stops working. You only decrease to this amount when the returns, the actual amount pumped starts to lower by too much.

Make the looks for yourself, try to do the math, it does not add up. In my view whatever formula you get given from anyone you must question (even those from me). The article gives a surplus of two million barrels a day from Iraq and Saudi Arabia, yet the processed goods keep on rising in price. What are we not being told? What are we not seeing?

I’ll let you decide on that part.

 

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September 2, 2015 · 22:42

Get the Frack out of here!

For the UK it is a small place, it can be found to the right of the North Sea and it is called the Netherlands. Today, a judge has decided that the Dutch Gas Corporation (NAM) has been found responsible for the massive damage houses in the state of Groningen had been subject to. The initial 900 claimants can rejoice to a chunk of 5 billion Euro. This is only the beginning for the NAM as the judge also decided that all houses within the earthquake region will have the right to file a claim against the NAM.

You might state that this is not such an issue, but is that the case?

On the 19th of July 2013, in the article ‘The Setting of strategies‘ (at https://lawlordtobe.com/2013/07/19/the-setting-of-strategies/), I wrote: “we should not forget the issues that the Dutch county ‘Groningen’ is going through as it has seen a rise in small earthquakes giving home owners massive costs to repair and additional losses in house values. These issues are to some extent denied/ignored as the investigation is going on, yet the damages that the people see in the news on a regular bases tells another story. At present corporations are now claiming for millions in damages from both the Dutch gas company (NAM) and the government“, now the invoice is due, which gives view that fracking has been an experiment that came at a massive cost, costings that are ignored by those who ignore bad news. I ended the article with “We, the Commonwealth nations must stick together to stay afloat and survive, fight together to become the nations of true prosperity again. None of these strategies are ready for that essential need!“, as I see it, I have been proven right.

On the 27th of November (at https://lawlordtobe.com/2013/11/27/two-deadly-sins/), in the article ‘Two deadly sins‘ I wrote “The question becomes whether George Osborne has been properly instructed involving the risks he would place Wales in? If he is briefed by stockholders, the UK should take another look at these proceedings. I understand that heating is hard and very expensive, but can people continue when they are faced with long term, perhaps even unrepairable damage to England itself? Can that be acceptable? I am not a geologist, so there are elements I have no knowledge of, yet it might be realistic that many Walesians did not sign up for Shale Gas experiments when it could cost them both Cardiff and Swansea, both containing the largest population in Wales. Is Britain ready to pay for 350,000 damaged homes?”

Now with the NAM losing their case, these issues are now adamant for the UK too. Did Minister of State for Energy and Climate Change Andrea Leadsom consider these dangers when she made her speech yesterday? The Lancashire Evening Post (at http://www.lep.co.uk/news/community/fracking-is-great-opportunity-1-7438282) states: “Shale gas is a fantastic opportunity for the UK. The industry could be worth billions of pounds to our economy, provide more than 60,000 jobs, creating financial security for more hard-working people and their families while also increasing our energy security“, with the NAM now losing billions, how secure is that future? More important, apart from the earthquakes the Netherlands had, how secure are the catchments of the toxic chemicals that are used in the fracking process?

There is a bigger issue too. I agree with her statement “There is no question that the UK needs natural gas. It meets a third of our energy demand, and we will need it for many years to come. If we carry on the way we are, we’ll be importing 75 per cent of the gas we need by 2030“. The UK should not be dependent on all this, in all this a solution must be found and as it stands, fracking is not the solution, it never ever was. For all this we need to take a look at the article (at http://www.bbc.com/news/science-environment-20595228) called ‘Fracking: Untangling fact from fiction‘, an excellent BBC article that does state “Their report indicated that future earthquakes as a result of fracking could not be ruled out – but the risk from these tremors was low and structural damage extremely unlikely“, which amounts to the information the NAM gave in first instance, now a massive multi-billion euro bill is due, which begs the question: “Is the juice worth the squeeze?” I cannot state this for certain, but there are question, even as we see the statement “the UK has more than 50 years of drilling experience and we have the best record in the world for economic development while protecting our environment and people“, the answer the BBC published puts all this on loose screws, it makes for a debate on the amount of danger houses and drinking water is handed as fracking is still the operational solution that remains the number one consideration. My worry is the quote “Operators will pay communities £100,000 for each exploration well site plus 1 per cent of production revenue, worth £5m-£10m, to be used as the community sees fit“. If that comes with a blanket non-liability clause than the NAM issue shows the dangers of considering all this. When the government shells out millions and gets a billion pound claim in return, we should consider the longer term effects that shale gas has.

In the end fracking was never the money making swine the Dutch hoped it would be, in addition, the case as it was lost by the NAM (on all counts no less) shows that the long term consequences are also a partial unknown. The NAM will get additional bills in losses and damages, whilst the revenue now falls away and most of that will fall towards the person with the damaged home. The coffers (those that George Osborne controls) gives additional worries when the invoices do come in. it would make the faintest of notion that a few coins were to be made falls away towards the deadliest of costs, namely that of a claimant holding the government responsible for the loss of value on their house. Groningen in the Netherlands is the least populated area of the Netherlands and the damage there is expected to be soon in excess of 5 billion Euro. The conservative party cannot afford damages to that extent, fracking is just too risky an endeavour!

 

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August 21, 2015 · 07:41

Optus Yes = Optus WTF

You know, I have been in this field for quite some time and for the most I tend to give people (and organisations) the benefit of the doubt. Yet what should we think of an organisation that does not have its act together, seems to be clueless what it is doing, or should be regarded as massively incompetent?

I’ll let you decide on the following facts.

Fact one. The bulk of the Optus Shops, as well as nearly every other shop that deals in Optus mobile internet is out of stock.

This literally amounts to the notion that at Optus, at least two boss levels above the store keeper, people are either incompetent or asleep (which amounts to the same thing). The Huawei E5377 WIFI Modem is registered to be out of stock. How can a mobile provider like Optus continue without sellable product? To be this unable to service your customers, without any alternative is just beyond stupid. In addition, the fact that Optus stores are still in ‘Yes’ advertisement mode could be construed as misleading conduct. When we consider Australian Consumer Law, we see in section 18 Misleading or deceptive conduct “A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive“. Stating ‘yes’ and then not have it in stock, seems to be just that.

This is however not enough. You see, one product does not make for issues, this should be regarded as just a case of bad luck, which we all have that at times.

When people pay for services that cannot be upheld, we have an entirely different matter.

That part seems to be an additional issue that hit me like a steel mace across the chops. You see, I had a case of bad luck, I had to get a new phone, in my case the Huawei P7, which was on special. Less than three months later the battery buckles. I now only get 10 hours standby from a battery. This is massively unacceptable! So, I go to Optus and fair enough, they take it into repair under warranty. I cannot ask for more, which is fair enough, so now I am stuck with my old phone, which is a major concern on several levels. I got lucky, because I got to borrow a Huawei E5251 with 8 GB. The first file goes swimmingly, which means 700 Mb all done. Now the problem starts! Even though powered, it takes three attempts to get a 4.8 GB file, 1.7 GB, 3.8 GB, and after that at a little over 1.3 GB the system stops, failed attempts with corrupt data. No way to save it, this now implies that Optus can no longer maintain a functional 3G wireless connection. This now has large repercussions for the consumers, because the consumer pays for 8 GB of data, whilst it was never functional. The lobotomised excuse from ‘customer care’ is ‘you used your data’, whilst we now have an issue with the reliability of the Optus network. The half-baked excuse they gave that ‘this can happen’ holds little water when the consumer gets to pay for functionality that cannot be met.

The question in my mind now becomes, is this isolated or is this a symptom of a much larger issue? This now takes us to the Australian Financial Review of May 18th 2015, where we see “Singtel-Optus chief executive Allen Lew will focus on keeping costs down by providing more customer services via the internet and run a “hard-nosed” review of its 160 retail stores” (at http://www.afr.com/business/telecommunications/optus-in-hardnosed-retail-review-to-keep-costs-down-20150517-gh3h5q). Yet, when we consider the hard-nosed part. Is that the case or has the upper staff ignored infrastructure issues? When I cannot rely on 3G networks in Sydney city to download data (speed was not an issue), we must consider that the objective of ‘keeping cost down’ is now at the expense of its consumers, a part that was not that clear in the Financial Review. This makes the quote “yes, we will grow but we will make sure that the growth is profitable growth” debatable at best, and concerning at the very least. Another quote is “an Optus spokeswoman later told Fairfax Media that cutting costs would not lead to any decrease in service quality or an overall fall in jobs“, well the service levels are not met, whether the job situation remains good, is something for the future to be decided.

So, is there a pure stock issue, or is there more? The latter remains the more likely than not scenario as my personal point of view, for all shops to be without 4G wireless routers implies that that the stocktake part does not work or the shortage is nothing more than a signal that the Optus network is starting to get really congested. That last part is of course a speculation on my side, but doesn’t it make sense? Virgin and Telstra are selling their 4G modem plans, yet in the case of Virgin, they too ‘suddenly’ ran out of the Huawei E5377 WIFI Modem. Which would seem to give strength to the thought that this is a mere ‘stock’ issue. Yet, if that is so, how incompetent was the executive to let it go this far? In addition, the issue of the unstable 3G is not addressed.

For this I have to make a jump back to 2010, when this was posted “Optus is known to put a lot of its web data through a proxy which reduces the packet size and makes it seem like your connection is faster. This comes at the cost of reduced quality in the form of images and the like“, important to know here is that the source is not reliable, but it is one of many voices. In 2011 the Sydney Morning Herald gave us (at http://www.smh.com.au/digital-life/mobiles/optus-makes-customers-pay-to-fix-its-blackspots-20110411-1da6b.html), with the quote “But analysts believe the real reason behind launching the product is that the Optus mobile network is struggling and Optus would prefer to make consumers fork out money to ensure their mobile phones work at home, as opposed to the Telco investing in more mobile towers“, which now gives us a clearer view, a view that is more reliable at least, in addition we get “Foad Fadaghi, a telecommunications analyst at Telsyte, said femtocells had typically been used in the US by poor quality carriers that had not invested enough in the capacity of their networks” which is an additional tone to the previous quote. The Optus response was “Optus said in response to the criticisms that the new technology was designed to ensure customers received “the best value and experience from their mobile devices”. It said it had invested over $2 billion in its mobile network over the past five years and built over 600 mobile sites in 2010, with a similar number of mobile sites planned to be built this year“, yet consider the issue when we read “Telco’s needed to be upfront from the start about coverage and the capacity of their networks and the onus should be on them, not the customer“, an issue I basically faced as no uncorrupted data house arrived at my station. The mention of ‘capacity of their networks‘ is now in play. For a 4G tower to scale back to 3G is one thing, yet do they process basic 3G in the same way? 600 towers is a massive amount, and that article is a few years old, but the final part in all this was at http://www.pocket-lint.com/news/133245-4g-vs-3g-it-s-not-just-download-speed-you-know, as well as the Telstra site (which I will ignore for now). A 4G network should be able to offer data at 15.1Mbps, which is only barely above normal broadband. 3G gives data at 6.1Mbps, which is considerable slower, yet if time was not an issue, 3G should work, but in my case it did not. I reckon that we are starting to see congestion where 3G is sacrificed to maintain the 4G standards. This is pure speculation on my side, but is that such a stretch? There were clear indications for half a decade that Optus was a failing network, now they thought they were back, but the deals offered through Optus Yes were so ‘fashionable’ that millions switched, now we see that adding a thousand towers whilst the data need of millions went up by 250% could be a clear indication of massive congestion dangers, which will now lead to dropped data packages and in some cases corrupt packages, which gave me my aggravating position. 8 GB to download 5 GB and none of it survived the trip. Now this month (actually this week) we see “Optus launches tri-band carrier aggregation“, which shows increased speeds. The quote “It is a more efficient use of our spectrum bands and will provide a more consistent and better experience for our customers“, it is the ‘more efficient use of our spectrum bands’ that flagged it for me. Is this truly about ‘speed’ for the customer or to deal with congestion? If congestion is a problem in Sydney, than we have new worries, more important, we will soon have a lot less stability. In all this I will state again, that some of these views are speculative and of course they are tainted due to issues I faced, but are they less of an issue because of that? Now let’s see if the same problem persists with Telstra, I know a guy with an extra wireless router, let’s see what happens tonight!

I try to stay on the fence and fair (even though I am very much pissed off), I just wonder who else has been faced with corrupted downloads whilst having to pay for the download. I reckon Optus has a problem and they still have to find a way to address it.

 

 

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August 2, 2015 · 21:08

A digital deception?

There is an interesting weekend going on. First we see people waking up to the Microsoft premise that free is apparently never free, in addition, we now see more and more noises regarding Net Neutrality. We will get back to Microsoft soon enough, because there is more to Net Neutrality than meets the eye. First let’s take a look at the definition of Net Neutrality. Wiki tells us “Net neutrality (also network neutrality, Internet neutrality, or net equality) is the principle that Internet service providers and governments should treat all data on the Internet equally, not discriminating or charging differentially by user, content, site, platform, application, type of attached equipment, or mode of communication”, now this sounds interesting, but the reality is not that easy as I see it. For example, consider Oracle Forms, who needs the reserved bandwidth, if we cannot deliver, that solution would become an issue to implement. Oracle Forms is not the only one, many other situations exist where priority is essential. Video conferences is one of several. The idea came from Tim Wu, he is the Isidor and Seville Sulzbacher Professor of Law at Columbia Law School. His paper Network Neutrality, Broadband Discrimination. The paper can be downloaded at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=388863.

As any academic work, it is quality stuff, yet, do I agree? I have an issue with the following parts:

On page 1 “Critics, meanwhile, have taken open-access regulation as unnecessary and likely to slow the pace of broadband deployment“, America is about to encounter the point where ALL the TCP/IP addresses have been taken, no more addresses, which means that IPv6 will soon be the only option remaining. You see IPv4 provides roughly 4.3 billion addresses. Companies, people, devices all requiring an IP address (mucho plural), well at some point the end is reached and that point is now, but that is not the entire point of my objections, because “likely to slow the pace of broadband deployment” is about need. I do not see how broadband deployment is hindered by the current system (other than running out of addresses). We have seen an almost exponential growth in getting online. Ever since the broadband has been an option, we have seen spectacular growth. First through normal internet connections, then via cable providers, now in addition we have mobiles with 4G and WiMax providers.

The second quote is “That deviation is favouritism of data applications, as a class, over latency-sensitive applications involving voice or video“. Which might be fair, but for the most, this has apart from specific application NEVER been a true issue. YouTube caches, so I personally have never truly seen an issue, not in over 15 years. Voice is a different situation, is this about VOIP? On one side, in an academic paper we need to keep an open mind, which makes it a good statement, but when we regard government pushed policy “open access alone can be an insufficient remedy for many of the likely instances of network discrimination“, the use of the word ‘likely’ seems a little unacceptable.

The next issue is found on page 158 of the paper “Have broadband operators tended to favour certain uses of the Internet?” To what extent? The goal of this section is to answer these questions, to the extent possible, for broadband networks during the year 2002, so we get answers based on a situation that is 13 years old, so this is BEFORE true smartphones, before quality 3G and whilst 100Mb broadband was rare. 1000Mb is now in some places regarded as slow, we get internet information faster on our mobiles now, than on broadband in those days, overall the growth of speed has been near unparalleled since the beginning of the internet and I am just looking at the last 5 years. The more I read of this 39 page paper, the less this makes sense in the current environment. Not the thoughts by themselves, the thoughts made perfect sense (to a certain degree) in those days. Yet, the ISP’s and Cable providers evolved almost exponential in their offerings. For the same price I now get a little over 10 times the amount I had before. I now end up with 500% download space of what I need (and I have one of the cheapest offers), so far I have not seen any limitation on what I require, so is this a pure American issue? That could be the case, but those pushing Net Neutrality better realise that moving business from US to Canada is not that far-fetched an option, I personally see these events as the FCC seems shooting itself in the foot.

Yet are my thoughts correct? (Always a good question to ask)

Let’s take a look at the Washington Post (at https://www.washingtonpost.com/news/the-switch/wp/2015/07/24/republicans-are-trying-to-defund-net-neutrality-will-it-work/), ‘Republicans are trying to defund net neutrality. Will it work?‘ The quote “This week, the Senate Appropriations Committee approved a bill that contains an amendment singling out the FCC and net neutrality. Notably, the rider would prohibit the FCC from using its most powerful regulatory tool to police Internet providers — Title II of the Communications Act” is at the centre. Yet, what the Washington Post shows is nothing more than a political side.

It’s CNN that gives us part of the goods (at http://money.cnn.com/2015/06/12/technology/net-neutrality/), they ask a few questions and give us answers. That is what matters. So let’s take a look.

“Isn’t that what exists today? For the most part. In reality, the world won’t look much different on Friday. Netflix won’t suddenly stream any faster for you. AT&T (T, Tech30) and Comcast (CMCSA) won’t abruptly stop laying down high-speed fiber cables and investing in their networks as retaliation“, after which CNN brings a quote that is surprising “And Comcast can’t slow down file-sharing websites, like it did to BitTorrent a few years ago“, which is more than interesting. Because, for the commerce of the USA file sharing is not a good thing, even though downloading movies is copyright infringement, pursuing these events is a near impossible task, especially when those servers are outside of the USA.

Who supports net neutrality? Now this is the number one question. “AOL (AOL, Tech30), Facebook (FB, Tech30), Netflix (NFLX, Tech30), Twitter (TWTR, Tech30), Vimeo and every other major Internet company are in favour of the FCC’s new rules. They create the content you read and watch online, and they don’t want to face discrimination by network owners who can threaten to charge higher fees or slow them down“. This statement is pretty far out there when you are not an American. In America, when you see places like Comcast, you pay for 75Mbs, 150Mbs and prices go up fast. So from this point is there reasoning for Net Neutrality? I still do not agree, but before going into this we need to look at Sprint, they offer unlimited high speeds with a sharable 10Gb for $100. This is less than 40% of the bandwidth I had 6 years ago at half this price. San Francisco gave me decent prices that are in alignment with what we see in Europe. Again, will Net Neutrality solve this?

Now let’s take a look at those supporters, Facebook and Twitter are data collectors, Twitter is the smaller and Facebook in the larger extent. Netflix customers require download power a lot more than Net Neutrality. The same can be said for Vimeo, AOL and Google+ for that matter. They all are vying for a customer base and when a person gets 10 GB at $100, whilst Europe and Australia enjoy prices like $70 for 200 GB you can see the issue at play. I am wondering whether this is about Net Neutrality or is there an issue with cartelisation in the US? We are so used to see that things are cheaper in the US, the fact that the US is leaps behind when it comes to the internet. That does not address the Net Neutrality. In my view it leaves us with more questions. The fact that prices are so high makes me wonder why a place like the US is not more competitive in that regard. But this article is not about that. It seems that Netflix needs download power to survive, and that is lacking in the US. In addition, it seems that the providers are extremely ‘protective’ on pricing, when investigating prices, TWC gave me “You are visiting our website from an area we don’t currently service“, which I got whilst entering a Chicago Address. So in all this, there is a multitude of issues, which have less to do with Net Neutrality and more about the stranglehold on pricing some seem to keep in the US.

Now am I upset? Well that is not really the question is it? I am like many others a capitalist (to some degree), yet that part has always been drenched in reason. As the information is reaching me, reason is not really a part that the internet providers seem to employ in the US. Especially as they offer internet at 33% of the speed and at 20 times the price. So it seems to me that Net Neutrality, even though in this light might have some effect to some of the solutions depending on the internet, yet the overwhelming thought from me is that as the FCC pushes Net Neutrality, we will also see a shift of the business world seeking an alternative.

When we see an argument that “Comcast could slow down BitTorrent traffic (it did)“, yet when we consider an article by Jacqui Cheng from the 24th July 2010, we see ‘Only 0.3% of files on BitTorrent confirmed to be legal‘, this was from a study that involved 1000 downloads, so 997 were infringing in one way or another, so why is it an issue to slow down BitTorrent?

A final issue should be given to Wired Magazine, who (at http://www.wired.com/2014/01/three-dangers-net-neutrality-nobodys-really-talking/) gives us several views in the article ‘Three Dangers of Losing Net Neutrality That Nobody’s Talking About‘

The first comes from American Library Association head Barbara Stripling “we’re in danger of prioritizing high-quality internet access for entertainment over education“, is this about the costs of a broadband plan? I have seen how this is not cheap, even as the article is only a year old. She also states “Ultimately, “pay to play” only benefits the privileged“, which I can agree with, it will be about usage and bandwidth, Net Neutrality will not up the game for them, it is about pricing and in some cases the prices are overwhelmingly ridiculous.

The second issue is ‘we continue to give more control over the internet to the government‘, which seems to be the case, but why is it done? Draining additional resources, forcing costs that should not be with the government. The quote here is “What’s worse is that we won’t see it coming, because the FCC’s power will creep in incrementally, on a case-by-case basis — a death by a thousand cuts“. Why is the FCC even bothering with this? Regarding the extent of what I saw as it applies to the US, this is becoming an increasing case of ‘Unjust Enrichment‘. Yet, the legal scope is not entirely ready to deal with this from an internet point of view. The North Dakota Supreme Court ruled in Schroeder v. Buchholz, 2001 ND 36, 622 N.W.2d 202 that five elements must be established to prove unjust enrichment.

They were:

  • An enrichment (Telco’s making excessive profits)
  • An impoverishment (Consumers are charged above their affordable income).
  • A connection between enrichment and the impoverishment
  • Absence of a justification for the enrichment and impoverishment
  • An absence of a remedy provided by the law (clearly in absentia)

It will be hard to prove this part, you see, it is not just about enrichment and impoverishment. The internet world is moving population classes into the haves and the have not, which is a different standard, yet the foundation might apply in finding the remedy for internet pricing, especially when we realise that one in 10 that would end up spending a little over 10% of income to allow for internet (based on the Chicago example), is this an excessive cost? That would be for a court to decide and that decision would not be the same state by state. Yet as that becomes a solution, the Net Neutrality need would diminish.

In the end, I am not convinced that the issues are about ‘neutrality‘, but it is about current technology and about fairness and affordability of the internet, especially when we consider that every child today needs to learn to proper use the internet from a young age, only to keep even with the other players, once the US falls deeper into the pay to play trench, we will see the growth of additional classes of segregation, those who are technically viable users and those who are not. That last one must be avoided at all costs, an issue Net Neutrality as I personally see it will not answer.

 

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July 29, 2015 · 10:14

Freedoms removed by Amazon

One of the most outrageous articles of the year hit me this morning, via the Guardian off course! The piece in question is ‘Amazon proposes drones-only airspace to facilitate high-speed delivery’ (at http://www.theguardian.com/technology/2015/jul/28/amazon-autonomous-drones-only-airspace-package-delivery). In the first, since when does a company decide on traffic rules? Can anyone explain that to me? In the second, since when is a company allowed to set FAA rules (or in general rules of flight regarding safety of airspace)? In the third, how in the name of all blazing hell does a company decides on how amateurs, hobbyists and innovators do their work?

Well, it seems that Amazon has stepped up to the plate to ‘suggest’ a few changes. Let’s face it, Amazon is a place of nothing, a mere grocery store for parchment products. In the UK they paid £11.9 million in taxation and the year before that £4.2 million, so why should we give them even the slightest consideration? The Australian Amazon site is limited to kindle stuff, so they pay even less there. You know, they are big in Luxembourg, so there is every possibility that they can pursue their drone packaging strikes in that country. But to give any consideration outside of Luxembourg and the US is a little too strong, so the quote “Amazon is proposing that a pristine slice of airspace above the world’s cities and suburbs should be set aside for the deployment of high-speed aerial drones capable of flying robotically with virtually no human interference” should not be taken too seriously.

We cannot fault Amazon for having vision, but it comes at a cost. You see “It envisages that within the next 10 years hundreds of thousands of small drones – not all of them Amazon’s or devoted to delivery – will be tearing across the skies every day largely under their own automated control” shows us that there would be a massive drop in the need for delivery people, which is not good for job security. Now, in opposition, these things happen, when people started to correspond through their computers, the people did not think it would grow beyond the realm if Geeks and Nerds, now, the bulk of the population has not touched parchments, quills and ink for a long time. Less postman were needed and on a global scale dogs were in mourning for nearly a decade.

Now we get the part that Amazon thinks is visionary “The company’s aeronautics experts propose that a 200ft slab of air – located between 200ft and 400ft from the ground – should be segregated and reserved for state-of-the-art drones equipped with sophisticated communications and sensing equipment and flying at high speeds of 60 knots or more. A further 100ft of airspace – between 400ft and 500ft – would be declared a no-fly zone to act as a buffer between the drones and current conventional aircraft such as passenger and cargo planes, thus mitigating fears about the impact on manned flight or dangers posed to people on the ground“.

I wonder how these aeronautics experts got their degree, perhaps it was added to the side of the pot of vegemite in an effort to market the product to Americans? Perhaps their degree was the wrapper for Troyer Roll Butter (if you know the product, the joke makes sense, Google it!). You see, the sky is filled with these weird things, that need to be all over the place, they are called helicopters, the police uses them, the press uses them and oh, yes, the emergency rescue services uses them all over the world, also in city areas. So this ideas hold a few operational holes even before it is seriously considered.

There is an additional concern. We do not deny that drones will be the big thing in the next decade, which also means that indie developers and visionaries will emerge, so is the quote “segregated and reserved for state-of-the-art drones equipped with sophisticated communications and sensing equipment” anything else than an attempt to crush market growth and keep it in hand for a few established brands? How will that ever be any good for innovation? Furthermore, the image gives way that hobbyists, rural hobbyists will be pushed from their rural live to little spots, just like the Native American Indians were. In my view, if you want to be top dog, you’ll just have to create a superior product that can anticipate these events. By the way, helicopters come in all these areas, including in the no fly zone, so this idea is saturated with bad insights from even before day zero. Not a good start me thinks!

So in reference to the position papers where the call states “It calls for a “paradigm shift” that will allow hundreds of thousands of small unmanned aircraft to fly under their own technological steam without the current involvement of humans through air traffic control“, that part could only work if there is one player, once there are more, if becomes a technological jungle of miscommunications and lost handshakes due to iterative updates, flaws and glitches. So how about letting drones work above the freeways and major lanes? It would not hinder anyone, hobbyists and innovators continue and unless a helicopter absolutely must land on a highway (likely medical emergency) they can continue without any hiccups.

Wow, I just solved the ‘lack’ of free airspace in 7.2 minutes. How clever am I?

Then we see “Amazon sets out five capabilities that drones must meet if they are to be allowed to fly inside the new 200ft high-speed corridor“. well let’s just agree that this is not up to Amazon to begin with, the fact that they precede this with “to realise that futuristic vision safely“, implying that they are working on a solution only they will offer, laws must abide with… In my view it is not up to them, many nations know that drones will be the new slave labour force (read: unpaid population that will drive others away from a job), which is a little out there (the way I framed it), but the reality is that this market will massively evolve over the next 2 decades and we have to give space to innovators and visionaries, not limit their scope to the need of “sophisticated GPS tracking that allows them to pinpoint their location in real-time and in relation to all other drones around them“, which is basically stating that drones must be a product made by DJI, Raytheon or Northrop Grumman to be allowed in this airspace. Amazon does NOT get to make THAT call!

the additional quotes “Online flight planning that allows them to predict and communicate their flight path” and “Communications equipment that allow them to “talk” and collaborate with other drones in the zone to ensure they avoid each other” give additional notice to forcing us into a one player path. That is not what innovation is about. First the TPP is pushing innovation to the mercy of big business, now Amazon add more limitations here? That is not a playing field that the world signed up for.

So as we see that hobbyists and indie developers (and visionaries) are slowly pushed into reservations like the Native American Indians by the quote “Under Amazon’s proposals, by contrast, hobbyists would only be allowed to fly within the new 200ft-400ft corridor if their vehicles were equipped with the latest hyper-sophisticated gadgetry for autonomous flight. Otherwise, they would have their activities confined to geographically demarcated airfields in relatively unpopulated areas that would be set aside specifically for the purpose” we have to wonder what Amazon has up his sleeve. Because either the US government is so bankrupt that it will agree to anything to not collapse before the results of the next elections, or is Amazon just waving in the air to be noticed?

The quote by Brendan Schulman, drone lawyer and senior executive and DJI gives us additional issues regarding the Amazon statement “by far the greatest use of unmanned aerial vehicles today was by amateurs. That’s currently by far the most common use of the technology, so before you disrupt their experience you want to think carefully about what slice of airspace would really be needed by these new technologies“. I would say ‘Amen!’ to that, because the issue that the article danced around (perhaps intentionally) is that Amazon needs to adhere to established safety protocols, we do not change protocols because of Amazon. I can agree that down the track changes will have to be made, but that time is not now and especially as the paper ignored several basic avionics issues.

Which now gets me to the paper where in a mere flash something stood out to me. Consider the quote “Amazon believes the current model of airspace management will not meet future sUAS demands, particularly highly-automated, low-altitude commercial operations. A paradigm shift in airspace management and operations is necessary to safely accommodate the one-operator-to-many-vehicle model required by large-scale commercial fleets“, in that apart from a massive dose of arrogance, we see “the one-operator-to-many-vehicle model required by large-scale commercial fleets“. So it is already on the premise for big business where one controller manages 100-200 drones. The shift of a workforce that only requires payment in cc’s of fuel.

In my view, the air is for now still empty, it will change, that much is certain, but it will be the people that decide on how far this goes, it is not Amazon to make that move. I am not entirely certain that Amazon should be the lead at all, but that is perhaps a discussion for another day.

What is in the last part an issue is the small part privacy activists were given. They are all up in arms regarding police and spook drones. Which is massively farfetched as these people have already given away their liberty through Facebook and other social means, so these two parties receive via e-mail all you did, including the amounts of times you ogled the ass of the neighbours wife (and teenage daughter). We seem to forget the massive danger that follows, it is not Amazon with its non-human package delivery system. It is the fact that in any innovation, organised crime follows pretty quickly, because they know that it takes the government up to 5 years to catch up, so in the first 5 years they can strike it rich. Drug deliveries, via cheap drones to penthouses. The paying clientele gets balcony to balcony delivery via a $499 drone and there is no link between the parties. Crime is already making a nice killing here, so the proper focus is not here and when it gets to be in the right place it is already too late.

So Amazon should not be setting the pass for removed freedom, it should set pace to create the right atmosphere, an attempt that they failed miserably from my point of view.

My opinion in this matter is strengthened through a previous article regarding Amazon which was published on March 30th (at http://www.theguardian.com/technology/2015/mar/30/amazon-tests-drones-secret-site-canada-us-faa). The title ‘Amazon tests delivery drones at secret Canada site after US frustration‘ already implies the ludicrous part in all this. A ‘secret Canada site‘. Why? Because a spotter could take a pic? Because of industrial espionage? Actually, that last one is not THAT far-fetched. So let’s leave it for now.

In the article we get two parts that show my view the first is “Into that aerial slice the company plans to pour highly autonomous drones of less than 55lbs, flying through corridors 10 miles or longer at 50mph and carrying payloads of up to 5lbs“, which represents as stated in the article for 86% of all the packages, now that is fair enough, if you want to address 80% of what is done now, yu see a choice that is just common sense. Now part two “The Company wants to offer its customers the ability to have packages dropped on their doorstep by flying robots within 30 minutes of ordering goods online“. Initially that pat makes sense too. Yet combined, we get ordered articles are delivered within a range of 18 miles. Here we account for loss of time for picking up, after which the drone gets 30 minutes, so 18 miles is pretty much the limit, so this is a metropolitan solution, this is less about ‘global change’, but more the need to address the high impact profit places like New York, Vancouver, San Francisco, Honolulu, Seattle, New Orleans, San Jose, Chicago and Los Angeles and a few other congested places. The ‘global’ part was just nice to give it marketing. They need to address congestion and dromes will make sense. Yet the visionary part is that they are trying to address it on a global scale, because if this is accepted, Amazon would be sole player in places like London, Paris, Amsterdam, The Hague, Munich, Berlin, Rome and Sydney for that matter too. That seems to be the reality and it is not a bad idea to have, but in that adjusted view, Amazon does not get to set policy, especially as Europe might develop its own drone solutions. Binding options for developers through ‘sophisticated GPS tracking‘ is what I would call ‘the big No No’.

Brendan Schulman, aka the drone lawyer shows us the merits of my thoughts “Amazon’s Canadian airstrip-in-exile should be a “serious wake-up call to politicians and regulators”. “America has led the world in aviation development,” he said, “but for the first time in history we are at risk of losing out”“.

There is the part, where I made the reference to the TPP. These presentations are all about big business carving their patch making sure no one else can inhabit it. The plane industry is polarised, but drones are another matter, drones can invigorate visionary workers and dreamers, because a drone is not an expensive tool, you can buy them in a game shop and the next kid getting one could be the one who revolutionises that field because he/she thought ‘what if I want to do this, could I alter my app….?’ that is all it takes to create a billion dollar corporation.

The FAA has (according to Amazon) taken much too long to make up its mind, it also stated “it does not believe that drones can be flown safely under their own autonomous control, and is insisting that humans must keep them within eyesight at all times“, which makes it non-profitable for Amazon. For now the FAA is right, but there is no given certainty that this is still a truth in 5 years. The mobile industry, Wi-Fi and sensor market is evolving at an alarming rate, my $699 mobile phone now has the same technological options a $15K digital film camera had 10 years ago, only the lens is the physical difference in quality, so that market will evolve, possibly beyond my comprehension before I die.

I feel certain that the FAA realises this, but they report to others and those people see that drones will be the new orgasmic high for organised crime. Common Law in the US and in the Commonwealth is flawed enough for all players to realise that this opens up massive undeclarable profits for these players. With the one to many option, whatever small chance of successful prosecution of a drug dealer any Districts Attorney had in the past, flies straight out of the window via drone. Here we see how the law has not caught up again.

Should it stop drone development? No! But there are a few sides that need addressing, which cannot be done today, but soon it will be the only blockade remaining. What happens when that day comes?

 

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