THE GILDER FRIDAY LETTER - 09-15-06
[unfiltered, uncut and unedited; go to the Gilder site for highlighted links ]
gilder.com | Issue 264.0/September 15, 2006
HEADLINES:
- The Week / Telecosmic Time Travel
- Friday Feature / The Stealth Job Boom
- Friday Blogger Bonus / Rutledge: Telecom and Growth
- Readings /
The Week / Telecosmic Time Travel
Excerpted from the August 2006 issue of the Gilder Technology Report.
George Gilder: Ever since Gilder/Forbes Telecosm number 9, we’ve been pumped up about our 10th Annual Telecosm Gala. Forget the GTR; we are party animals at heart, learning technology osmotically, as we carouse with the philosopher-techies gathering among all the widescreen TVs in the Bullwacker’s Lounge at the Resort at Squaw Creek.
Ten years ago, in the heat of Palm Springs, where we held our first Telecosm with Forbes. Qualcomm (QCOM) was our top choice, with its venerable co-founder Andrew Viterbi our chosen speaker, and I assumed that soon enough it would combine with Globalstar, which was represented in Palm Springs by chief architect Ming Louie, in a new planetary empire of code division multiple access (CDMA). But Irwin Jacobs of Qualcomm and Bernie Schwartz of Loral could never get together on price and Qualcomm decided it did not need a retail CDMA satellite backup. It shunned Globalstar and hired Ming Louie to run Qualcomm’s marketing in China. That’s why a decade later Verizon (VZ) and Sprint Nextel (S) service still are pocked with deadspots and the inferior GSM (global system for mobile) is the only truly global system. Also at Palm Springs, Texas Instruments (TXN) was showing off their microelectronic machines (MEMS) based digital light processing technology on all our conference screens. It is flourishing today but it has been a long climb. John Doerr celebrated the stunning creation of value by the PC industry, Mary Meeker touted the opportunities on the net, and Michael Milken explained the failure of stock market values to address the worth of intellectual capital. But none of these heraldic alerts intimated the likelihood of a crash four years hence.
Also on board for Telecosm 1997 was Marc Andreessen, letting Microsoft’s (MSFT) Mark Ryland crush him in a debate on Java. (We were bailed out by the now notorious Patrick Naughton, then a sagely articulate Java manager at Sun, who stood up in the audience and gave a rebuttal.) Scott McNealy was also in Palm Springs, hilariously castigating Microsoft without necessarily convincing anyone that Sun (SUNW) could prevail. Fresh from Sun, Eric Schmidt described the road ahead for Novell (NOVL) in an age of the hollowing out of computers. Peter Cochrane of British Telecom discoursed on time travel through fiber technology, David Patterson, Leonard Kleinrock, and Schmidt held a summit conference on the future of computer architecture, and Bob Metcalfe laid down the law and the prophets and denounced Internet access over dialup modems. (“It is stupid and the modems know it’s stupid; you can tell by the way they hiss and squeal every time they are made to do it.”)
Attending Telecosm Ten, October 4 – 6 in Lake Tahoe, will be an experience in time travel. You will find many of the same guys still on the runway ready for you to get on board for a takeoff that now is underway …
To read the entire August issue of the Gilder Technology Report, including in depth updates on Zoran (ZRAN), Sigma Designs (SIGM), Synaptics (SYNA), Ikanos (IKAN), and EZchip (LNOP), log on to gildertech.com with your subscriber ID today.
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Gilder/Forbes TELECOSM 2006
October 4 - 6 | The Resort at Squaw Creek | Lake Tahoe
ATTENTION TELECOSM 2006 ATTENDEES: Just two weeks left until Telecosm 2006. Prepare yourself for an intense three-day examination of the ascending technologies with the potential to disrupt our lives, business decisions, and investment portfolios.
Rick Adam, Chairman, Adam Aircraft
Luiz Barroso, Distinguished Engineer, Google
Peter Bocko, VP, Display Futures, Corning
Gordon Bell, Media Presence Research Group, Microsoft
Mark Bereit, Director of Product Dev., IRIS Technologies
Peter Bocko, Division VP, Display Futures, Corning
Matt Bross, Chief Technology Officer, BT Group
Charlie Burger, Analyst, Gilder Technology Report
Sanjeev Challa, Chief Technologist, Ikanos
Josh Coates, President, Berkeley Data Systems
Tod Cohen, VP and Deputy General Counsel, eBay
John Day, Staff Scientist, Essex Corp.
Alex Dickinson, President and CEO, Luxtera
Brendan Dixon, Computational Biologist, Biologic Institute
Steve Forbes, Editor in Chief, Forbes magazine
Eli Fructer, President and CEO, EZchip
Frank Galuppo, Chief Executive Officer, Amedia Networks
Apostolos Gerasoulis, Co-Inventor, Ask.com
George Gilder, Editor in Chief, Gilder Technology Report
Klein Gilhousen, Co-founder, Qualcomm
Steve Goldman, Chairman, Power-One
Cary Gunn, Co-founder and CTO, Luxtera
Monte Hancock, Chief Cognitive Research Scientist, Essex
John Hasnas, Trapped:
When Acting Ethically is Against the Law
Phil Hester, CTO, Advanced Micro Devices
Peter Huber, Senior Fellow, Manhattan Institute for Policy Research; Co-founder, Digital Power Capital
Omar Javaid, Senior Director, MediaFLO, Qualcomm
Kevin Kahn, Director, Communications Laboratory, Intel
Rich Karlgaard,Publisher, Forbes magazine
Alan Klapmeier, Founder, Cirrus Design
Susan Kunz, President and Co-founder, Solidware
Andy Kessler, The End of Medicine: How Silicon Valley (And Naked Mice) Will Reboot Your Doctor
Fred Leonberger, Principal, EOvation Technologies
Lawrence Lessig, Professor of Law, Stanford Law
Kenneth Lowe, VP, Business Dev., Sigma Designs
Michael Luby, Co-founder and CTO, Digital Fountain
Paul McWilliams, NextInning Technology Research
Carver Mead, Professor of Computer Science, CalTech
Michael Milken, Chairman, Milken Institute
Robert Mundell, Economics Nobel Laureate
Lane Patterson, Chief Technologist, Equinix
J. Tom Pawlowski, Chief Technologist, Micron
Vern Raburn, President and CEO, Eclipse Aviation
Justin Rattner, CTO, Intel
Jerry Rawls, Chairman, President and CEO, Finisar
Atiq Raza, Chairman and CEO, Raza Microelectronics
Michael Ricci, Senior VP, Optical Comm. Group, JDSU
Arthur Robinson, Professor of Chemistry; Founder, Oregon Institute of Science and Medicine
John Rutledge, Global Economist, Rutledge Capital; Forbes.com; Fox News' Forbes on Fox contributor
Dayne Sampson, VP, Ask.com
Steven Sprague, President and CEO, Wave Systems
Larry Sweet, President, Euclid
Alexander Tokman, President and CEO, Microvision
Nick Tredennick, Editor, Gilder Technology Report
Terry Turpin, Chief Scientist, Essex Corp.
Fred Weber, President and CEO, MetaRAM
David Welch, Chief Strategy Officer, Founder, Infinera
AND MORE …
Check out the complete agenda.
NOTE: Scheduled debates on Net Neutrality, patent reform, regulation, “the end of medicine,” whether Google can be stopped, the death of the dream of ALL-optical network, and the politics of science and economics promise to be just a few of the highlights.
REGISTER BY OCTOBER 3 TO SAVE OVER $500
Register BEFORE 10/2/06 to SAVE BIG
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Friday Feature / The Stealth Job Boom
Ashby Foote, GTR Subscriber and President Vector Money Management (9/14/06):
BULLETIN: If you have one of the 3.3 million jobs the Labor Department can’t explain please contact Secretary Elaine Chao at www.dol.gov. That’s right: 3.3 million new jobs is the cumulative difference between the Labor Department’s two ongoing surveys (payroll and household) since the current economic expansion began in November 2001.
Some background: the Bureau of Labor Statistics (BLS) is tasked to provide a monthly snapshot of the U.S. employment situation. This is no easy task when one considers the wide spectrum of American enterprises, from mom & pops to global conglomerates and how they have been franchised, outsourced, flex-timed, people leased, tele-commuted and WiFi-ed over the past decade. To accomplish this undertaking the BLS uses two monthly sample surveys conducted by the U.S. Census Bureau. For the top down view, 160,000 businesses and government agencies are contacted for the Current Employment Statistics (CES), referred to as the payroll or establishment survey. This is the “headline” number and the survey focused on by the press and the financial markets. For the bottom up perspective, 60,000 households are contacted for the Current Population Survey (CPS), referred to as the household survey. The BLS makes adjustments and population control revisions to the surveys to facilitate apples and apples comparisons but discrepancies invariably arise. This comment comes from a February 2006 BLS study: “Although many theories about the discrepancies have been put forth, complete explanations have never been found for any of the divergences, despite a significant amount of research by the BLS and by outside analysts.”
A complete explanation may not be possible but a persistent and widening gap that has now reached 3.3 million (7.9 million versus 4.6 million) and represents 42% of jobs created during this recovery surely deserves exploration for any under appreciated cause and effect. One is reminded of the famous retort in the midst of the 1980’s boom, “If this is voodoo economics, send more witch doctors”.
One of the most insightful commentators on change at work in the economy is Chris Anderson, editor of Wired magazine and author of a brilliant new book, “The Long Tail.” He cites three forces that are transforming the economy and creating vast new opportunities at the grass roots for small and boutique businesses. Force 1: the democratization of the tools of production – the obvious example is the PC as a tool for publishing and multi-media. Force 2: the democratization of the tools of distribution – the combination of the PC and the Internet makes everyone a distributor. Force 3:connecting supply and demand – search, filters and feedback loops like that found on Google, iTunes, Amazon and Netflix help niche content find interested buyers and users.
Read Ashby Complete Article:
article.nationalreview.com
To read comments on Ashby’s article posted by other GTR subscribers, log on to gildertech.com with your subscriber ID today.
Capturing impressive long-term gains, Gilder’s tech portfolio is up 280%
since the market low in October 2002, compared to 94% for the NASDAQ
and just 67% for the S&P 500.
When many investors were seeing their portfolios beaten down by tech stocks, George Gilder continued to point subscribers to the right tech companies at the right time.
Subscribe to Gilder Technology Report and Get the Next Tech Winner!
Friday Blogger Bonus / Telecom and Growth
John Rutledge (Beijing, 9/12/06): After spending the last week in China, I can tell you that the Chinese government understands the only way to deliver high growth and increase living standards without further fouling the air and running out of energy is to focus on IT, communications, and the financial service sector. The Chinese are putting a full court press on innovation and entrepreneurship by aggressively investing in tech education and pursuing policies to attract foreign capital to relocate to China--especially such as R&D operations.
What are we doing? Congress has gotten itself twisted up in its shorts over non-issues like network neutrality and who gets to tap into the bloated universal service fund, and too concerned with lobby groups (aka campaign funding) to risk passing the communications regulations overhaul the U.S. needs to drive investment and productivity.
Check out Rutledge’s blog:
rutledgeblog.com
ATTENTION: Hear John Rutledge speak Friday Oct. 6 at Gilder/Forbes Telecosm 2006. See telecosmconference.com for details.
A N N O U N C I N G : The Gildertech Blog
Logon to blog.gildertech.com to see what’s new.
Readings /
The Online Supernova: 15 Years Of The World Wide Web
informationweek.com
Despite PC Drama, New Battery Tech Still Years Away
informationweek.com
Swanson: Paulson vs Paulson
disco-tech.org
Apple Attacks Digital Living Room
redherring.com
The Phoenix Will Rise
article.nationalreview.com
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Editor: Mary Collins / mcollins@gilder.com
Research: Sandy Fleischmann / sfleischmann@gilder.com
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