StartUpCrunch

As capitalism begins to emerge as the predominant force devouring the Internet, which essentially equates to cannibalism in many instances, we find that like in other industries where capitalism has previously flourished that the young and emergent new innovations are very often simply copied, plagiarized, and blatantly stolen, in many cases those committing theft simply abuse / use the legal institution as their protection, rather than it serving to protect the victims, it aids the wrongdoers.

The main reason that the Internet has witnessed such innovation thus far is in large part because of the FREE philosophy that has been widely adopted by the hobbyists who have already developed much of it. The hobbyists have literally paved the way for almost all of the innovation that has been witnessed. But as we start to see capitalism and it's cronies take a stake online, we also simultaneously see the stifling of innovation and a monopolization of players which in turn standardizes the one-size-fits all model.

Going side by side with the above, the danger any new industry faces is that instead of the powerful companies or parents and guardians for want of an analogy, looking after the young, supporting them with their wealth and helping them grow from acorns into a wild symbiotic forest, they cannibalize them, treating them as cattle that they feed from, inevitably leaving a baron desert in their wake.

For the hobbyists survival and innovation to continue, we as a community need to recognize the fallacies that are evident and that have already seen the destruction of many previous revolutions that have come and gone. Namely that instead of large muscle men being able to bully their way into dominance, at the same time shutting out those very people who paved their way, that instead the road builders are rewarded for their part of the construction.

This brings us onto the nurturing that companies such as Google who are now predominant and leading exploiters of this terrine (farmers) have to provide back into the land and forest in order to foster the continuance of speciation and innovation that we all so enjoy.

PHASE 1 : The Google scam

Much of the ground work for the hobbyist's survival has been already been laid (unintentionally), but unfortunately the accountants are now in charge at Google, and while they started as company with good intentions, they recently made a huge attack on the community at large by reducing the PageRank of companies that linked to others (they believed were doing so for profit) and as a consequence, the buyers of links who did so to enjoy better natural search engine ranking positions, have been intimidated and threatened with loss of business and a stern warning.

Googles motivation is simple, they want the only one's to profit from search to use Adsense and Adwords (their own products). However, they have overstepped the mark in a number of ways while at the same time missing an opportunity.

Google should have absolutely no say what-so-ever as to who links to who and for what motive. "After all, Google itself, that harbinger of the Web2.0 era, thrives on info that could be said to "belong" to others — the links, keywords, and metadata that reside on other Web sites and that Google harvests and repositions into search results" Wired. We the community allow them to scrape our Web sites with their robots, that use bandwidth, resources, and our propriety information. For them to later (after their dominance has been attained) insinuate that we should be barred from linking to others for profit or any other reason is a crime, albeit not illegal like so many other inadequacies where capitalism's law is impotent.

Further the Google PageRank which is a currency for those that sell-on the respect that they have earned, should be updated on a regular basis, and at minimum 4 times a year (currently we have witnessed the toolbar update being as sporadic as once every 8 months or so).

By allowing Google to scrape our sites and data in order that they can build an index of natural authorities, and thus build one of the most profitable companies in the world from that index, in return we unrelinquishly should have absolutely no interference as to who and how we decide to share our own earned respect (page-rank).

By leaving this industry that was just flourishing to continue with their support is the right thing for Google to do, and in doing so would allow content creators, developers and anyone with something to offer free of charge, on their own Web sites a much needed source of revenue that would keep the bailiffs from the door and thus allow them to continue to create and innovate and build new roads for us all to travel down.

Unfortunately Adsense revenue does not bring in enough revenue (despite the success stories that get paraded about) to cover the hosting charges for many creators let-alone provide them a living wage. Not to mention it is an unfair way of supporting content creators, traffic is not the only indicator of value! Lastly least not forget that the share of revenue that Adsense publishers receive is a closely guarded secret and if the truth was known there would most likely be an outcry at the injustice of the profit split.

PHASE 2 : GNU Lesser General Public Licensing Scam

Content creators (hobbyists) have widely adopted the give it away free philosophy, with good intentions that in hindsight have allowed anyone including muscle men, to use their content free and without so much as a link in return, but the muscle men and everyone else should pay (in some way) for the use of material that they exploit for their profit.

As an application developer myself, I know full well that there is absolutely no way whatsoever that I would have been able to create the applications I have, without the prior work of the many whose shoulders upon whom I stand. I have recently contacted some of those who upon I stand asking them about their work and efforts and what if anything it has given them in return.

To provide just one example is all that is necessary as the story is a widely universal one. In an application I developed recently I used a free piece of code called PHPFlickr by Dan Coulter. This is essentially an interface between the Flickr API and PHP users, allowing PHP developers to create applications and interact with the Flickr API very elegantly. As such this class probably saved me alone 1 week of development to achieve my intended goals. In return I made a very small donation of 20 Euros to Dan as a small gesture of good will and I linked to him from the about page of the application that I built, as I did with all the other pieces of code from third parties that I used.

Now thats not much I know, but when I contacted Dan to ask him for input for this article, I was UNastonished to hear that not more than 100 USD in total had been donated to him for this work. And while it is true that he had had a few other opportunities as result from that work, it in no part satisfies or equals his efforts IMO. But the bigger story is that this exact same story is repeated by hundreds of thousands of others that have the same story to tell.

The solution I propose involves the creation of a new license that creators can use to give away their work free of charge to third parties but in return for a quality link. I have called this the Full Attribution License and the essence of it is that third parties can use the material, linking back to the creator, who would thus gain further respect within the search engines that they could then pass off onto their own other commercial projects or if they wish sell on to others who could gain better placements within the search engines.

The argument that the likes of Google and maybe others would make against this initiative is that the natural search results would be subject to manipulating and this would lower the quality of the results. This is absolutely a red herring. 1) The SERPs are already being widely manipulated. 2) It does not equate that the results would be worse than they are now. It's simply competition after all. 3) The main motive Google have in stopping this trade is simply to further their own.

More to come.

Were sitting right on the very edge of probably one of the most pivotal points in human history, not be alarmist or anything but the challenges we are currently facing as a species, literally promise to wipe out a large portion of our race within our lifetime and if not it will be our little brats who suffer. That's not to say that a population reduction is inherently a bad thing, for we do need to reduce our footprint else nature will do it for us (and the latter will have no regard for our human values). But one way or another we stand here looking the storm in the eye.

Yes not to interrupt the party or anything, but it's actually all going on out there. Outside our little bubble there are people struggling against the forces of evil and others striving to create solutions to real problems that will improve our collective lives, all the while paving the way to the next milestone. But instead of partaking, in large part we are running round being modeled by the distortion caused by the manufacturing of greed and desire for success by an ignorant media, while often denying our own intuitive feelings for what we should actually be doing instead.

The limelight has been hijacked and those being paraded about as stars and blessed with accolades in the latest bubble, are a hand picked selection backed by corporate muscle men attentive to the wide audience participation achieved by connecting and exploiting social graphs, who are jostling in the hope they will be the next masterminds behind the coming social generation that will replace television.

But for all the social networking 'competition' or more appropriately 'muscle but no brains' that has been applied to these 'me too' applications, the focus as to where and what we should really be trying to achieve has been abandoned by the 'muscle men' and further reinforces an agenda that takes us ever closer to the edge of oblivion.

The recent Lane Hartwell copyright scandal is an example of how far removed the rest of the world seems to be from the disparities actually occurring in the web revolution. She claimed infringement over a photo that she was paid for by Wired, which took her little more that 10 minutes to take, and then had a wobble when it was used again without attribution and compensation in the `Bubble1.0 parody' viral video.

The scandal it caused was one of the most publicized events at the end of the year 2007. But the real story is nothing to do with her little wobble, but rather the disparity in public opinion as to the value in effort and investment put in by the thousands of hobbyists that drive this revolution, and do so for little more than the satisfaction gained in achieving a difficult goal, in comparison to the frivolous characters who parade about upon its surface.

It's sort of a given rule that it is not important to understand / or value the work of the quiet breed that make it all happen in the background and thus the attention is courted and granted to the frivolous attention seekers who most oftenly buy their accolades and press coverage via expensive conference attendances and PR teams that do the unsavory work. (This controversy certainly hit a nerve and was the most bookmarked article on TC in 2007.)

Yet for all the misguided focus being granted to the frivolous attention seekers, a great divide has once again been created between the spotlight controllers (the media) and the underbelly of memes and genes that cobble together the building of this organism and who are the true creators and genus who deserve far more in the way of attention then is currently being granted.

Yet more to come.

In the beginning, it was the hobbyists who sat glued to their desks in their bedrooms with copies of the electronic 'Softdisk', with their soldering irons cobbling together the earliest remnants of this revolution, Steve Jobs and Steve Wozniak although slightly nerdy were fundamentally hobbyists, passionate about their nerdy little world of IC's and building software that made dots move about on the screen.

Well haven't we all come a long way since those early days. We have enjoyed one of the greatest revolutions to ever confront mankind. In just 25 years a single generation has witnessed the emergence of a force that essentially embodies opportunities and tools that could and will no doubt play a significant role in the continuation of the human race, as it battles against the threats posed by rises in population, shortening of supplies, climate change, and man made pollution (in all its disguises).

So is it all about business? NO. It never was and never has been. Yet somehow when you read the latest tech blogs and tech articles in the media, they are obsessed with profits, takeovers, buyouts, venture capital rounds of investment, growth rates, page views, unique visitors, advertising revenues, sell outs, and then follows the emulators of the latest killer application, generally rehash's of someone else's idea with with a twaddle of ajax thrown in and a whopping 6 million USD to pay for the 'brightest' ninja coders Stanford just chucked out.

It's when it gets to this point that you just know it's going to go 'pop snap' once again. The first bubble was a ridiculous hostile takeover bid where the internet (long ignored by the mainstream) suddenly showed signs of making profit. Ignorant 'reporters' wrote double page spreads in popular newspapers blessing overinflated virtues for the likes of 'Last Minute.com' claiming they were threatening to take out the travel industry, paving the way for their later headlines which made all the worlds media as they sold out for a whopping 850 Million UKP (valuing the company on a par with WH Smith). Utter madness.

I was an early visitor to the Lastminute.com offices, housed on a floor above a retail chain on Oxford street, (London), 3 stories up in an open plan office, desks scattered about haphazardly, with about 20 ninjas busy at work, not even so much as a receptionist. Great little cottage industry yes, but company worth 850 Million clearly not by about a million miles.

So sure it all followed thereafter, the geeky little nerd world was thrusted into the limelight as the quickest place to get rich, and with it came the abandoning of the essential elements that fueled this force. Not that the hobbyists ever went away, rather their platform and hobby was hijacked by the city corporations who muscled their way into every conceivable crevice they could, like crazies buying up virtual real-estate in Second Life.

When someone got wise that these so-called companies essentially amounted to little more than online brochures that were NOT going to be taking over anything let-alone the world, rapidly we saw their demise. It was a sobering time, the money left the scene disgusted with its losses and I for one hoped they would never forget that lynching and forever leave the hobbyists in peace to continue their little hobby without the fanfare of these get rich fortune tellers.

Alas that was not to be, first we had Google, then Myspace, next up Youtube, then Facebook, all creating the buzz and hype that of-course could not go unnoticed. Now attention is back in full swing from all those sleazy cooperate masterminds that are back to corrupt the terrain once again. With them came yet another year of distortion and delinquency. The buzz and hype surrounding every penny made and lost in the race for the latest me-too, 'I got a social network too' has frankly been ridiculous.

So its the end of the year and quite obviously it's the end of many a wannabe billionaires dreams. As they slowly come to the last page of their cheque books, and without a dime in sight, they have no choice but to close the doors once again in a fashion we (hobbyists) are starting to get used too. They come and go like speculators in the great gold rush, and leave in their wake desolate buildings and give the auction companies fodder to peddle.

You see, a little word of advise to the speculators and bullies waiting in the wings ready to pounce on the next big thing. What drives this thing we refer to as the Interweb is a creative collective of hobbyists, who do not awake an night with the excitement from dreams of billions passing through their fingers, but instead with nerdy solutions to coding problems that might allow us to make a feature easier to use (for example) and thus more user friendly.

It's the hobbyists that are the brain power behind the big advancements here, and who rarely ever get any credit for their efforts. A case in point is the likes of the Thomas Fuchs the creator of script.aculo.us who has a little donate now button on the home-page of his site where he offers probably one of the most widely adopted Ajax libraries to-date which has been incorporated by many of the top 100 movers and shakers in the latest gold rush. All of which is offered open source and licensed under the MIT License. Yet you wont hear the slightest mention of him by the likes of TechCrunch totally oblivious as to who's shoulders upon their cronies stand.

As we all know donations are few and far between in the over saturated world of "who can give it away the quickest is the winner". So unlikely so, that I would be extremely surprised if more that 5K USD has passed through that little donate now button (thought of course I don't know). And yet all the while we read non-stop dribble about these valuations and investments into copy-cat 'social networks' (or what have you) that utilize the AJAX scriptaculous library.

It is only natural to copy, plagiarize, emulate, and be inspired by others success, why that is one of the fundamental forces that drives creation itself, and my problem is not with entities that are inspired by others, that use ideas others developed, or necessarily copy parts of systems for their own projects. However that generosity does NOT extend to the parasites who for want of nothing other than to make profit do all of the above, with millions in investment backing behind them and with the sole intention being to take out a potential market and long since will be forgotten those that paved the way with their ideas, creations, mistakes, and efforts.

more to come.

Flop2.0 Predictions 2008. The dollar has plummeted, the bubble's are popping, the recession's kicking in, yet we have NOTHING to fear!

• What is a bubble? It's an overinflated market where big money distorts the playing field, greedy investors muscle their way into the market copying every potential innovation until the market is over saturated and no-one can possibly stand out, long since forgotten are the original innovators that pioneered the first killer application that paved the way for the others to emulate. SOUND FAMILIAR?
• What is a recession? It's where an overinflated (VC backed) group of companies start dropping like flys. It starts off slowly and gains pace exponentially then slowly levels off again like a sinusoidal wave. SOUND FAMILIAR?

So I'm looking forward to this one! Lets face it, one thing there won't be is a reduction of eyeballs on the internet. The internet is going to continue to grow exponentially - just like it did through the first bust in the dotcom orgy.

But why is such a decline to be celebrated? Despite the excitement associated with these greed based booms there is little good to ever come out of them. Innovation is NOT facilitated by greed, it is a natural phenomenon that occurs when the conditions are right on the ground. In fact bubbles actually hinder innovation as the true innovators are plagiarized till the point that they drop, no way of competing with the millions that are invested into wannabe emulators (competition 'they' call it) of their original ideas, they quietly drop out of sight often disillusioned and disheartened by the ice cold realities of so-called 'business' and lost from the collective genius that is the force behind all bifurcations.

Those hoping for a miracle, that they would have been one of those lucky few who do make it into the limelight with 15 seconds of fame and an article on the front page of Techcrunch, covering their announcement that so-and-so have invested so many millions in an x-round of angel funding, fear not. It was a scam to begin with, the innovators and entrepreneurs rarely ever get real dough, instead are forced to slave away for 5 years or more growing the business and if are lucky, get to stand behind a long que of others who have proir claim to their labor, efforts and success.

The nerds were once an untrendy bunch of losers, outcasts according to the 'in crowd'. Yet now it is the nerds that are all the fashion. Yes it's fashionable to be a nerd. Who would ever have thought that? But as with all fashions their comes the emulators and then you get everyone and his uncle who wanna be a billionaire nerd like Gates (well maybe not like Bill per say). But these are not real nerds they are simply cling-ons who are only in it only for the money and glory. They couldn't care less about innovation, let-alone the hours and hours of unpaid dedication that goes into to creating true genius.

"Wheres the business angel?" That's what they keep asking for, "how are you going to monitise it? You call that an invention, you haven't even got a 'buy it now' button!". These are the cries from the skeptics to this latest boom, and right they are but for the wrong reasons. See it's not about making a business, it's about making a hobby that becomes a success organically. So while the skeptics and analyzers lecture you about what your doing wrong and tell you all how to do it right, let it be understood that today it's no longer fashionable to be a nerd, we've been there and done that. The next big fashion is going to be 'the hobbyist' developer.

SO WHO ARE THE HOBBYISTS?

When TC announced it was having a competition for the 'best new startups', I immediately smelt a rotten egg. Well that egg just turned into a corpse that rightly belongs underground! I mean the stench of it.

I've seen it all before, so I'm not at all surprised, but I do feel for all the wannabe startups that entered, spammed their friends, family and their user base, begging them to vote, and just got bummed big time. Not only did they get whittled out but in their place is a hand picked selection that were probably on the roster long before the so-called nominations even started, and adding insult to injury the real startups were implied to have been fraudulently voting for themselves and had to be 'stripped out'. I bet they liked that remark MA!

There is not one unknown startup on the list of 'nominees' (I use the term very lightly), the finalists are simply a list of all the main boys currently prancing about on the catwalk, all with millions in backing and all Madonna's in the VIP room.

It's a sham, none of these companies are new finds or small startups. It is simply a VC backed and sponsored manufacturing of who WILL be the winners, decided by hedge-fund money that was made at the rest of the worlds expense.

The dotcom orgy has been quietly forgotten and now we are in the 'keep the party going' mode. But underlying this pep talk and upbeat celebration of corporate finance bulling its way into the tech sector is a deep crises lurking that promises to ensure that the dead pool will be the most successful new venture of the year.

So what's under the table? The Dollar is in sharp decline to the point that the currency no longer being accepted by many (even catwalk supermodel Gisele Bundchen wants to be paid for her modeling and sponsorship gigs in euros), and most importantly of all oil traders are looking very seriously at a switch from the Petrodollar to the Euro. Hugo Chavez continues to embrace real democracy all the while america is heading for yet another rigged election. The war on Iraq is in good shape costing millions in lives and blood while the barrels are smuggled out on war ships and to top the lot the bottom just feel out of the US mortgage market. So lets have a celebration for all those hedge funds dollars at the Herbst Theater shall we!

Coming up next is the list of dead pool finalists for 2008. Cast your vote here: http://www.TheArringtonTouch.com

Best technology innovation / achievement
Earthmine
Like
Move Networks
Twine
Viewdle

Best bootstrapped start-up
FriendFeed
PoliticalBase
ProductWiki
Techmeme
UpNext

Best new gadget / device
iphone
Kindle
Ooma
Pleo
Wii

Best business model
Glam Media
Imeem
Prosper
Weatherbill
Zazzle

Best design
Etsy
Jackson Fish Market
Netvibes
Smugmug
Songza

Best enterprise start-up
37Signals
Attributor
EditGrid
Ribbit
Zoho

Best consumer start-up
1800FREE411
23andMe
LinkedIn
Meebo
Zillow

Best mobile start-up
AdMob
Fring
Loopt
Shozu
Twitter

Best international start-up
Atlassian
Gizmoz
MusicShake
Netvibes
OpenAds

Best user-generated content
Digg
Facebook
Geni
Instructables
Yelp

Best video site
Aniboom
Hulu
Joost
Justin.tv
Tokbox

Best clean tech start-up
A123 Systems
Ausra
Gridpoint
NanoSolar
Tesla Motors

Best use of viral marketing
Flixster
iLike
iminlikewithyou
RockYou
StumbleUpon

Best time sink site
College Humor
Duels
kdice
Kongregate
Pandora

Most likely to make the world a better place
Causes
DonorsChoose
Kiva
One laptop per child
ZeroFootprint

Most likely to succeed
Kayak
Mint
Slide
Wordpress
Zivity

Best start-up founder
Reid Hoffman
Max Levchin
Kevin Rose
Evan Williams
Mark Zuckerberg

Best start-up CEO
Gina Bianchini
Dick Costolo
Toni Schneider
Rob Solomon
Lance Takoda

Best new start-up of 2007
Hulu
iMedix
Joost
Ribbit
Tumblr

Best overall
Digg
Facebook
GrandCentral
Twitter
Zillow

But Seriously, lets put the words of wisdom up front:

"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat".

Now I've got that off my chest, lets get the guns out. 6 million burned over 3 years for 60K in revenue... This is one of the most un-elegant and disgraceful extravagances I've ever seen. But the fun isn't over yet, they are actually having the gal to put the assets (LOL) IP address up for auction starting bid 250K. Now thats funny.

As many have pointed out in the comments the organic traffic is next to nothing, 80% coming from TC. The technology is worthless without the engineers who built it, and to keep 11 employees you need 3 million a year so forget it (someone must have made a fortune!). This fucked company won't make a sale on auction day and the chairs will be sold off from a garage sale on the lawn of the TC office (M.A.'s home).

But why gloat? This is why. M.A has received many such accolades and one has to question is he worthy?:

"The 36-year-old has become one of the most influential people in Silicon Valley. Like a latter-day Henry Blodget, the onetime star Wall Street analyst who helped fuel the late 1990s dot-com frenzy, Mr. Arrington uses his TechCrunch blog to determine the destinies of new start-ups and to fan the flames of the current Internet boom." WSJ.

• Featured on CBS News (again), Technorati 100, Feedster 500, and CNet Top 100 Blogs
• Mentioned in the Wall Street Journal online and print editions on December 7, 2005
• Mentioned in the San Jose Mercury News online and print editions on January 15, 2006
• Discussed at length in the cover story of Business 2.0 magazine (print and online) for September, 2006
• Voted the top blog by Business Week readers in a September 2006 poll
• Featured in the online and print editions of the Wall Street Journal on November 3, 2006
• Featured in a front page story in the San Francisco Chronicle on December 6, 2006
• Written up by the Financial Times in December, 2006
• Named one of the 50 Best Business Blogs by the Times of London in June 2007
• Written up by Wired Magazine in June 2007
• Featured with other blogs in the San Francisco Chronicle’s business section on October 21, 2007

It's unlikely those journals will cover the demise of the 'founder and significant shareholder' of edgeio at all. This one will slip away as a lesson was learned (and it could happen to anyone) category. But could it?

At this point I will refer others to the advice I posted on March 19th, 2007 here: StartUp Maina. Essentially MA headed none of that advice which will increasingly become more haunting to the many other VC backed fucked companies out there as they hit the bottom of their barrels and also make their way over to the deadpool where they belong.

Let this be a lesson to the other fat-cats out there who wish to effectively bully (buy) their way into the top positions, your money will not help you in this arena! The class is at the bottom of the barrel, and very much under the radar that TechCrunch tends to cover!