Obama 'Prism' Spying now extends to UK Government.

It would seem that the US Government citizen spying programme called 'Prism', has been used by the British Government as a 'back door' to getting intelligence bypassing British law.

William Hague, the UK Foreign Secretary and former leader of The Conservative Party, will today make a Statement to The House of Commons. A forthright man (we've interviewed him in Streamabout) and generally decent, fair-minded man, gave a dodgy performance on The Andrew Marr show yesterday. Uncharacteristically dodgy, in so far that he was unusually trying to dodge questions, which is not his style.

Indeed, he could easily have asked Theresa May to deal with The House of Commons today but has chosen not to - probably in order to kill the controversy at birth - which he won't be able to.

GCHQ, the UK's listening post has been gathering information through co-operation with The US National Security Agency since 2010 and The Guardian says they've generated at least 197 reports from Prism last year alone. They're circumventing UK legislation. Their work, in their own words, should be carried out "in accordance with a strict legal and policy framework" and it looks like it's not. 

Meanwhile Obama, in accepting that Prism exists and goes on, said that his Government "had struck the right balance" in collecting this data in the fight against terrorism. There's nobody doubting that terrorism data needs to be collected however, under a Court order in order to protect the rights of citizens. 

It's ironic too given Obama's criticisms of the Bush administration doing something similar (although to a far lesser extent) and on the same day when he is meeting China's President to discuss their spying and their anti-democratic controls. 

Ironic too that Obama has called his administration, "the most transparent administration in history". 3 months ago, Senator Ron Wyden a member of The Senate Intelligence Committee no less, asked James Clapper, Director of National Intelligence, "Does the NSA collect any type of data at all on millions of Americans?". "No sir" came Clappers reply which we now know to be a lie. 

Last night the same James Clapper said the Prism programme was "important and valuable". So if your Director of National Intelligence is prepared to lie to an Intelligence Committee Senator, what does that tell you?

Prism collects data on US citizen phone calls (time, length, location on every phone call made in America) and there still remains the controversy about access to internet servers. 

Facebook released a statement under Zuckerberg's name, to say "we do not provide any Government with direct access to Facebook servers". Indeed. The key word there is direct access.

But what seems to transpire, according to informed sources, is that they do provide the information through a "drop box" scenario. So the Facebook language revolves around "direct access" when it does seem they do supply it, but just in a different way.

A reported NSA slide show also shows that Microsoft were the first to comply in 2007 and Apple complied last year. It also noted the compliance of Google and Yahoo. We hear too of compliance by Skype, YouTube, PalTalk and AOL. 

Twitter does not feature and has come out clearly and strongly of its refusal to take part.

This story is only starting. The difficulty Obama has, is the deceit and furthermore, the manner in which a scheme like Prism has been set up to get around the law. There's never been any problem getting data, just the safeguard is that you do it with a court order.

The British government are starting to get into trouble too for using Prism secretly and again, bypassing law. 

But perhaps more pointedly is the use of the data. Whilst the cries of anti-terrorism might have some bearing now, if that data was used politically, it will cause problems. In others words, to identify leaks to media or activities of politicians who are not pro-Obama. It's just the same as breaking into a Watergate building.

It will also cause huge problems to the Internet companies who provide data on you and me, globally and yet feigned privacy. 

This is the sort of story that brings down Governments. And rightly so. The whole thing is rotten. 

HMV and Xtra-Vision. Who's next? Skype announces a cracking idea from Monday with Microsoft's outlook.com. So could it be telephony?

Given recent collapses of HMV and in Ireland this week, the Xtra-vision chain which went into receivership (like a 'Blockbuster' chain of retail DVD rental), it's clear that online played a major part in their demise.

Video and music downloads (legal in the main) through the likes of ITunes and Netflix which is surging ahead, meant that traditional retail DVD/Album sales went into spiralling decline. The point however should be made, that brands like HMV and Xtra-vision should have got into the online space but didn't.

They were, at one time, the dominant brands with the power to win online. Anyway.

One now has to ask, what's the next category or market segment that's now faced with the same challenges? And it's telephony.

Apart from "ordinary" threats of email, tweeting, texting and messaging which avoids the need for a quick (costly) telephone call, mobile operators continue to compete on price to woo subscribers. That in itself, is reducing margins and profitability.

It's a death spiral.

But apart from that, online operators are starting to each their lunch - exactly what happened in music and video.

Skype, the best known player (but there's hundreds) have just announced a roll-out of audio and video calling, with outlook.com in the UK from Monday and then the US and Germany this month.

All you need do is download a plug-in and login with your Microsoft account and you're integrated into the Microsoft email service. So that call, has just got a lot easier - it's part of your email. Merging the accounts will automatically merge contacts so connecting with friends will be easy as well.

It's phone calls at your fingertips.

Skype is part of Microsoft so furthering usage will also be pretty easy for Microsoft as Skype replaces their 'instant messenger' service. It previously partnered with ComCast bringing Skype to HDTV sets and Skype generates about 130 billion minutes of call a quarter - growing by 30%+. Microsoft also of course know mobile telephony with android phones.

It's hard to see the big global mobile brands compete with this and especially when we've seen so little sign of it to date. Perhaps they have had it too good for too long? like HMV and Xtra-Vision?

Unthinkable? Nope.

Skype. 280 million monthly users. And it's getting a push from its owner Microsoft with new ad formats.

Skype, which is owned by Microsoft, has 280 million, monthly users. And it's growing at about 40% year on year.

Pretty terrific numbers and now they're going to push it further. Or at least it would seem that they're being pushed by Microsoft's Ad division by all reports.

It has unveiled Skype Apps for Windows 8 (you know, as in Microsoft's Windows 8) but it's pretty quick out of the box. They are also introducing new Ad formats that play on social interactivity. 

An example will be promotions that will appear during conversation streams (ads as you speak). Maybe you're talking weddings - up comes a wedding dress designer promotion.

It already carries ads on its home screen and it did launch 'conversation ads', display ads that appear when the user has no Skype credit, earlier this year.

Another plan they have is to create interactive conversations when two people are looking at the same thing. Say a hotel. We're both looking at it so let's have a conversation about it. 

Brands too will be able to create groups of like-minded talkers, which you'll join and then the brand can run content through them (such as video). Say you join the Ireland Group - you'll get ads about the country, stories etc. 

All a bit confusing? Sure is.... but by developing new and different formats, Skype may attract in brands who want to try something different. It's the nature of the Skype audience being visual, live and online, that's the attraction.

It's clever too in that the audience uses Skype for celebration - weddings, birthdays, christenings and so on that can bring a creative opportunity that's a bit novel. So you could have a brand enter the right conversation at the right time.

Generally Skype has done very well in numbers terms because the core idea is a great one. Despite that, it has a poor interface and shabby marketing, but it will get better and it would seem, it now has a new focus.

What's great about Skype is that it's a game-changer for telecoms and one of the classic online ideas.

It just needs a small push to own the world.
Which it seems, it's now getting.

Vanity Fair's expose of Microsoft and CEO Ballmer, is out. Get it and be horrified about their downfall.

                                  

You may have been familiar with my blog of July 5 http://streamabout.blogspot.ie/2012/07/vanity-fair-august-article-to-add-to.html or indeed you may know of the controversy surrounding Microsoft.

Largely, it's a company that's really under the microscope because it has lost its way after Bill Gates departed the company. Apple's iphone business alone, does more business than the whole of Microsoft.

In particular, the current CEO Steve Ballmer, who is there officially until 2016 anyway, carries a lot of responsibility since the demise of the once great Microsoft, happened squarely on his watch.

Ballmer is a controversial character making ridiculous predictions about the demise of the Iphone and indeed the Ipad (you can see those interview videos on my original blog). Nonsensical predictions that he gets wrong on video and of course, haunts him now every step of the way.

He also carries himself in quite a ridiculous manner and video of him at the launch of a Microsoft conference (also on my original blog) is really cringey. Worse than that in fact.

On July 5, the controversy was furthered by the leaking of a journalistic piece on Microsoft in 'Vanity Fairs' August edition, which seemingly was to expose the cultural reason why Microsoft, under Ballmer, has lost its way.

It was to blame an inter-staff management system called 'stack ranking' - a rating system for employees. Titled "How Microsoft lost its Mojo" it's based on emails, interviews and internal documents, Vanity Fair was to expose this problem at the heart of Microsoft which it argues was mainly responsible for its lack of vision, lack of Microsoft creativity.

We were told in the snippets that we had, that the stack ranking system was corrosive and possibly the single reason for Microsoft's continued downfall. The article was considered to be explosive and one wondered if Ballmer would survive the onslaught - but I hadn't read it then because it hadn't been published. This weekend I now have.

Not only is it explosive (and excellently written) but it makes Steve Ballmer look like a buffoon. A man who gets it wrong time and time again and has now become an embarrassment to the company. "Stack ranking" gets a good mention but its not the focus we thought it was - Ballmer is.



Reporter Kurt Eichenwald says, "Ballmer's key business philosophy for Microsoft was so antiquated as to be irrelevant. The Microsoft CEO used to proclaim that it would not be first to cool, but would be first to profit -- in other words, it would be the first to make money by selling its own version of new technologies."


It includes an interesting quote from Steve Jobs - "The company (Microsoft) starts valuing the great salesmen, because they're the ones who can move the needle on revenues, not the product engineers and designers. So the salespeople end up running the company....it happened at Apple when John Sculley came in and that was my fault and it happened when Ballmer took over at Microsoft. Apple was lucky and it rebounded, but I don't think anything will change at Microsoft as long as Ballmer is running it".

He actually blamed Bill Gates for Ballmer. "Bill likes to portray himself as a man of the product, but he's really not. He's a businessperson. Winning business was more important than making great products".

Indeed.....and The Vanity Fair article blames Gates too with the fact that Microsoft had the lead on ebooks but it was stifled by Gates. They had the lead on itunes, but it was stifled by Gates. Gates appointed Ballmer.

It's really damning stuff and go out and get it.

This is too much public criticism laid squarely at the door of Ballmer and far more than I understood on July 5 for him to laugh this off. More importantly, Microsoft now appears to be a company in crisis and so uncool, it's not true. They are going one way and that's down. Their Skype acquisition is beginning to show no meaning.

I wondered then, based on what I knew, whether Ballmer would survive this very public criticism.

I have absolutely no doubt now.
Except an announcement soon.

Instaglasses from Instagram. This has the potential to replace smartphones. Smartglasses.

You'll remember the concept behind "google goggles" http://streamabout.blogspot.ie/2012/04/google-goggles-apple-fiddles.html in April of this year.

And now we have Instaglasses which is the Instagram version.

Designed by German Markus Gerke, they include a 5 mega pixel camera and (I presume) some web access allowing you to take pics, run them through Instagram and post. So you capture the world as you go. A camera on your head. They'll also soften your view of the world and can actually make Instagram's Mark Zuckerberg look angelic.

Possibly video won't be far behind either, dramatically allowing Instagram to venture into the world of video-sharing. Now that would be spectacular for Instagram and start to make sense of The Facebook 1bn acquisition. In fact, you could stream live from the glasses and actually "follow" people in real time visually. So one better than Twitter because this way you'll see what the celebrity sees.

Not unlike Google Goggles, they're a bit of a dream, a prototype for now, but signify the way that Social Media owners are looking at new content delivery systems outside of mobile. If you own the delivery system, you own the world.

Imagine for example, we all had Instaglasses, then we'd all use Instagram and the traffic stats would explode. Importantly too, these glasses are very cool. Or if we had YouTube glasses, we'd all be video-ing onto youtube.


This isn't a flight of fancy but a hard nosed business way to get consumers using more Social and in this case, using more of Instagram. If glasses developed, there's no reason why they couldn't become smartphones. Say using Facetime or Skype, you can make that person-to-person call and see them with your glasses as you talk. Why not?


Other delivery system ideas have included in-car projection directly onto your windscreen where you can see all your tweets/posts etc. Watches too have been thought of.

The accessibility of Social through easy delivery whether by glasses/watches/phones whatever, will enhance its growth. The problem with the surge in smartphone ownership (driven in turn by the need for consumers to have access online) is that the smartphone owner dictates who has access to it.


So if, as they are, Samsung continue to dominant the mobile handset space, they'll become a player in allowing/denying access to their platform. Iphone 4 and 5 deals with embedding Twitter and Facebook into their operating system (OS) is typical of this "ownership". http://streamabout.blogspot.ie/2012/06/apple-teams-with-facebook-tim-cook.html
 
You want to use our smartphones to reach your audience? How much? Exactly as the App store works.


Whereas, on the other hand, if there's other delivery systems (such as glasses), that issue dissipates. Instaglasses is another good indication of that thinking.

Expect something like them to be in the stores.

Expect to be wearing them.

Expect a surge in smartglasses.

This is going to be huge.

Vanity Fair August article to add to pressure on Microsoft. CEO Steve Ballmer's window is closing.

This is Steve Ballmer. CEO of Microsoft. The man who took the reins from Bill Gates in 2009 when Gates stepped back. Hardly Steve Jobs now is he? Although I think he tries to be. I mean who came up with the track "get on your feet"? Kind of like playing "simply the best". Cringeville.


There's an awful lot of people having a go at Microsoft at the minute.
And it has to be putting immense pressure on CEO Steve Ballmer.
One wonders if he'll survive it and especially after an article in Vanity Fair due on the newsstands in August.


But they're having a go firstly, because it's the launch of Windows 8 coming up. Oh, didn't know? Exactly. And remember the excitement, the queues for 95.


Secondly, the acquisition of Yammer for 1.5 billion (yep, billion) of a company few of us ever heard of, and which earns little revenue, is being seen as a bizarre way of buying yourself onto the front pages. One way to get that Facebook/Instagram 1 billion limelight. I blogged about it here http://streamabout.blogspot.ie/2012/06/microsoft-acquires-yammer-for-12.html


The official Microsoft announcement photo two weeks ago, did little to help things too and here it is. Steve Ballmer and the Yammer boys looking like something from the 70's rather than the new leaders in Social Media. Shocking.

As an aside, interesting too that when you go onto the Microsoft news centre and search 'Yammer' - nothing comes up. So Microsoft could do with updating their site - which for Microsoft, is pretty poor.


Thirdly, Microsoft have just taken a 6.2 billion write down this week following their disaster purchase of digital network aquantive in 2007 - then the biggest deal in Microsoft history. The 8.5bn acquisition of Sykpe by Microsoft in 2011 beat it. And what exactly have they done with Skype? Nada. Looks the same to me except with higher prices and more advertising. Vision?


But this write-down, wipes out fourth quarter earnings and that will have a stock/investor issue, adding more pressure.


The acquisition was seen at the time, as a response to Google's acquisition of Doubleclick (with which I was involved in a small way in Ireland) because the Microsoft move came only a month later. Kind of a "anything you can do" thing. But one huge 6.2 billion loss.


Fourthly, the success of Apple has been one-in-the-eye for Microsoft and continues to be. Apple's iphone division alone is worth more than Microsoft. Here's the genius Steve Ballmer in 2007 on the iphone. "500 dollars for a phone? You're kidding".

I could post the video where he laughs off the ipad or indeed this next one where he's not a fan either of the Android phone from 2011. Jesus.

And of course he teamed up with Nokia...who've recently had their ratings cut to "junk status".

So "visionary" doesn't exactly spring to mind and the company is slowly disappearing into a morass. Yes I know about Bing and Xbox but this was THE dominant player worldwide that now is being, well, just eroded. 


But lastly, the real crowning glory this week is an article in Vanity Fair August edition which seems to slam work practices at Microsoft and makes the company totally uncool. This sort of publicity might be the straw that broke it because it will be hard for Ballmer to escape it. 


Sometimes publicity is the killer blow because it's so public.


Titled 'Microsoft's lost decade' it's written by well regarded scribbler, Kurt Eichenwald.


It's not on the newsstands yet, but Geekwire have seen a full copy and refer to it as "epic". In other words, explosive.


Forbes have referred to it as "a devastatingly destructive management technique at the heart of Microsoft’s problems" and others are calling the exposure "Microsoft's downfall".


Techcrunch don't have the story because when they asked for a preview, they were asked for a fax number to "fax it on over". Honestly. And they've written a good humorous piece on that......
http://techcrunch.com/2012/07/03/can-someone-send-techcrunchs-fax-number-to-vanity-fair/


The controversy, supported by interviews and emails collected, is about management style and creativity. Or lack of.


It's based around a work system for employees in Microsoft called 'stack ranking' where employees are rated from good to poor. And according to Eichenwald that meant that "Every current and former Microsoft employee I interviewed—every one—cited stack ranking as the most destructive process inside of Microsoft, something that drove out untold numbers of employees.” 


“If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, 2 people were going to get a great review, 7 were going to get mediocre reviews, and 1 was going to get a terrible review,” says a former software developer. “It leads to employees focusing on competing with each other rather than competing with other companies.”


Which could well be the reason why the company under Ballmer, flounders.
Basically, it crippled the company and stifled innovation.


And from what I know it seemed to be a dreadful place to work which in itself is bizarre given the 'great places to work' awards Microsoft have achieved. I always wondered about those awards though, always did. I saw companies winning them who I knew to be dreadful.


But they were big companies who'd always take a table or two at the Awards dinner.


We'll see what happens when Vanity Fair comes out.
Watch out for the noise and watch out for Steve Ballmer.
Except it to be huge.
His window is closing. (sorry).

Microsoft acquires Yammer for 1.2 billion. Leaving billions scratching their heads. A bubble?

OMG! Microsofts Steve Ballmer and the Yammer boys badly pictured officially by Microsoft - could have flashed it through Instagram - announcing the acquisition this week and looking very 1970's. The new leaders in Social Media wouldn't you say?

I've been blogging a fair bit about whether we're in a bubble or not and as recently as last week here    
http://www.blogger.com/blogger.g?blogID=4671466363911057753#editor/target=post;postID=1971760983930398308

But I also go back to the Instagram deal and Mashable valuation in their CNN sale, and marvelled at the prices. After all, I'm not against a bubble and if money piles into the space, then good for us.

I note too that 3 year old Pinterest (yes, sure, I know, we all love Pinterest) without any revenues of note, raised 100m usd in the last week. But the hugely interesting thing about that, is that it was based on a valuation of 1.5 bn. 1.5 BILLION. Now it was late last year (yep 7 months ago) when Pinterest valued itself at 200 m. So how does a valuation increase so dramatically so quickly? Unless because of other high valuations and a scramble to do deals at any price. A clear sign that we're in a bubble.


And so along comes Microsoft. Remember them? They were the people who largely owned this space until Apple re-invented itself with Jobs and once Social started. I think they've lost their way although have made some good strides in the mobile phone market with Samsung but generally, not the ship they were. They did pay 8.5bn (yep, 8.5 BILLION) for Skype mid 2011 and did, well, not a lot with it and have recently announced a payment plan (which kind of defeats the purpose, doesn't it?) and Advertising. 

And this was the big plan.......increase payments and bring in advertising?

So I can't help thinking that they want to be back in the space, at the forefront, and now are desparate for attention. So they see Facebook and their 1bn acquisition of Instagram and they say, let's go one better.

Then they find Yammer. Never heard of them? Nearly everyone on the wires agree even those who'd you expect to know it all. Nope they say and look blankly. And Yammer has now been acquired by Mircosoft for 1.2 bn usd. A little bit more than Facebook's deal. Interesting pyschology that.


Yammer launched in 2008 and it provides for private communications within businesses - sort of a social network for your company. In September 2010, it was reported to have 3 million users and predominantly Fortune 500 valuable companies. My understanding is however, that this was based on free trials, but I could be wrong (BusinessInsider have a story that estimates only 20% of Yammer customers actually pay).

Features include allowing workers to share events directly to Microsoft Outlook. Videos and URLs can be shared. Topics of conversations can be shared. Conduct polls can be created, files can be shared. It allows you to see who's online and who's not. Sorry, have I missed something? That's it?

But I think critically important here, is the reporting features that allow company owners track their employees activities. Perhaps that's why companies use it? Perhaps? You think? Yeah Yeah.

It was also well funded having received circa 150m usd in support but obviously a big cash day in this acquisition. Clearly of course, it opens a channel to expose Microsofts products to high-end Yammer customers but a 1.2bn channel? 

A lot of people are bemused with this acquisition.
It's difficult to really see the pull of Yammer and the 'perfect fit' for Microsoft. 
It's more quickly and possibly unfairly, seen as an attempt to get back into the game with big time acquisitions, flagging big time ambitions.

I don't know.

But it seems a lot for a company that no one had ever heard of.

Except if we were in a bubble.