Category Archive Widget Business

Dangerous Path for Small Business

I find myself recalling the early days of PC’s when the mantra of the day was mainframes and modems and you rented the software you used for your small business. The PC brought freedom from this model, in that once you bought the software you owned it, well at least in theory. The rapid change in hardware and software brought about a dilemma of how to get but fixes and updates. The Internet came along at just the right time and solved the whole delivery issue. No more having to call vendors like HP for drivers and then waiting for the disk to come in the mail, but that was the time when we rode a dinosaur to work. Now it seems Microsoft and others really don’t want to sell you software anymore they want to rent it to you.

 I see this trend as going backwards right into the good old dark days for small companies. PC and now mobile devices give a small company great flexibility, but what happens if cash gets tight or the economy turns south, do you suddenly stop using your accounting system and creating documents, I don’t think so. Cash flow with rentals is great for software companies but it sucks for a struggling start-up. I understand the whole centralized maintenance advantage of the cloud, as we now call it, now with the added advantage of true collaboration. I get that we want to use our documents everywhere and on any devices and somehow that is being translated into a requirement to rent our software. There is an alternative, though not perfect, it can replace almost everything on the prosperity model and is free or nearly free.

 Open source, the words Steve Balmer of Microsoft associates with communism but in reality is just another model for software distribution. Instead of requiring you to pay up front for the software, you pay for access to real time help and documentation, otherwise the software is free. Many Open Source projects have great online forums and community that can provide help but in a somewhat delayed manner, hey I said free didn’t I… I need the answer now, so that won’t work mentality is understandable but even paid help is getting slower or more difficult to use. I just see too many small companies unable to do some of the necessary day to day work without some sort of Office suite, upfront affordability is a big issue and often you see every machine has a different version of Microsoft Office or no Office software at all. Small companies are confused when a document created on one computer cannot be used on another or worse, a document modified on a second computer renders it unreadable on the machine that originally created the document. I know you can control this directly in Office by specifying the file type, but most people just don’t understand why it does not just work out of the box.

 I have never understood why Microsoft chose to constantly change the default document types for each version of Office. I know that advances are made but why can’t an older Word 1997 document be opened in the new version with features that didn’t exist turned off and then saved back to the 97 format without a problem. The only thing I can think of is that Microsoft wants to force you to think you have to upgrade to make things work, and that is just want many people do. Most people just don’t understand enough about file formats to understand why one is not compatible with the other, they just want it too work. Standardization has been attempted through the OpenDocument Format but Microsoft only grudgingly supported the format and still defaults to their native proprietary formats (the default can be changed). There is also no standardized interface for all of the document types, of text, image, vector drawing, spreadsheet and database, etc, each one has a unique but similar interface. You cannot open a spreadsheet in Word and have it switch to Excel, instead it will try to open the file in Word as a jumbled mess.

 There are a quite a few choices for Office suites but few can do as much as office can. One contender OpenOffice became the default choice for an Office replacement until Oracle obtained Open Office as part of their Sun acquisition. Oracle just didn’t know what to do with an open source product and tried to monetize it by offering help for a per seat charge. Fearful that development would languish under Oracle a critical group of developers left and created a fork called LibreOffice, and they proceeded to rapidly fix some of the short comings of OpenOffice. Oracle decided too late that it was not up to the open source challenge and gave the software to the Apache foundation (Most WEB servers use Apache software). The damage had been done though, many had defected to the more rapid development cycle LibreOffice offered. LibreOffice has also become the default Office application installed with most versions of the Linux operating system due to its more forgiving licensing requirements. LibreOffice is also working of adapting their application to the touch interface of tablets and mobile phones as well as providing version for both the iPhone and Android mobile market. Open Office, at this time, has no such development under way. The coming release of a touch interfaces and Android version sold me on switching to LibreOffice, at least they seem to realize that is where the market is going.

 Even more impressive is LibreOffice’s ability to read old Visio files and create new ones readable by the latest Microsoft version, no good replacement for Visio existed until they did this. The last piece which I am sorry to say they don’t seem to be working on is a replacement for OneNote. I had chosen to use OneNote over it closest rival EverNote due to the ability to ‘Print’ documents directly from any application right into OneNote and the ability to create folders instead of having to tag everything. Perhaps they will see the light one day and remedy this but for now I will be creating some training documents using LibreOffice as I see this as the best application to serve the small business market I am focused on.

 Last but not least is collaboration. Microsoft handles this on an Enterprise level through a SharePoint server or on a smaller scale through the use of Microsoft SkyDrive cloud storage and the Office Web Application for Office 365. LibreOffice on the other hand now integrates with Content Management Systems and online document storage via the CMIS standard. This allows you to access directly documents stored on ECM systems, such as open source projects like Alfresco, Nuxeo or proprietary, like Microsoft SharePoint. A growing office does not need to increase the number of seat licenses as one would have to do with Microsoft’s proprietary solution, instead a small company can control its cost while providing the document manage capability and security a true collaborative environment provides through Open Source. Renting seems like a dangerous dead end to me, so I will be steering my clients to solutions that can grow and if necessary shrink as they do…

Microsoft and Pitchforks

Microsoft never seems to be far from some sort of spite whether it’s the poorly designed security of Windows, virtual disdain for open source (I think they compared it to communism at one time…), or being the eight hundred pound gorilla in the room. Microsoft though, reached a new low recently with the announcement of the Xbox One. Microsoft arrogantly assumed that it’s dominate position in consoles would allow it to dictate what the customer wanted. Personally, that seems to be one of the big problems at Microsoft, they don’t really innovate they just want to dominate. Apple is refined the art of innovation and integration, funny thing is I have problems with Apple because of their closed system, but that’s another blog. Well I was excited as my son was when I saw the demo footage of Titan Fall at E3 2013, that is until the fine print was read…

The reaction from my teenage son was, well, something I can’t even print. Let’s just say he was pissed off in a big way. Even more surprising was the comments coming from my early twenties daughter that I didn’t even know was a gamer; fathers are always the last to know, she was as equally upset. The theme common between them both, they would never buy another Microsoft game or console ever again. I am thinking, holy cow this is the teen that made me take him to midnight release parties for several of the Halo games. What in the world has Microsoft done to piss off these teens and X-Geners. By now it was coming clear this was just not limited to my quirky family but there was an army forming. Soon I was reading commentaries and blog full of spite and hatred (gamers can get a little emotional at times). I had to do a little investigating before my son and daughter went out the door with torches and pitchforks.

What had Microsoft done to earn such vile, well there were several things. First an internet connection was required to play Xbox One games, and after 24 hours the game would be disabled, yikes. On top of that the online check-in would only be supported in twenty-one countries and the system would be region-locked. The DRM system enforcement required the check-in to ensure you were on the up and up.  Second Only Microsoft-approved retailers would be able to sell used games. I should have been paying closer attention and shorted GameStop’s stock, after that announcement. Third, indie game developers (can you say small shop, small budget and almost no marketing) will be required to pair with a 3rd party publisher to distribute their games on Xbox One’s marketplace, or make a deal directly with Microsoft itself. Holy bat guano Batman big brother has come to town, what do we do? Titan Fall was supposed to be the talk of E3 instead it was these crazy controls. In one day Microsoft had angered every gamer, X-Gener and even the military deployed overseas. They poured gasoline on the fire when a reporter asked what the soldiers overseas would be doing and Don Mattrick, president of the company’s Interactive Entertainment division,  said “Fortunately, we have a product for people who aren’t able to get some form of connectivity; it’s called Xbox 360,” Mattrick said. “If you have zero access to the Internet, that is an offline device.” Ouch…

Competition being what it is Sony instantly realized what Microsoft had just dropped in their laps. They immediately went to task pointing out how their next generation console would have no such controls. Then the wave hit, preorders for the Xbox One started to slow on Amazon and Sony’s console started to gain the upper hand. Wave after wave of complaints filled in and in the end Microsoft realized their big mistake. They quickly removed the 24-hour connection requirement and the used games sales restrictions. Later they removed the third and opened up the development market for indie games. There actually is a fourth issue and another backlash I did not mention, primarily because they are still unresolved. The price of the Xbox One was set $100 higher than the Sony console at $499 because of the inclusion of the Kinect camera and microphone where built into the new console. Oddly enough there is a move to push Microsoft to resume the restrictions they originally planned, as they are necessary to allow a form of cloud based game sharing that Microsoft had come up with (something similar to what Steam does on the PC), and you thought we were the only banal generation. For now my son and daughter have put down the pitchforks and are oohing and awing at the resolution and complex game play made possible by these next generation consoles. The torch is still burning though, as they are less trust worthy of Microsoft more so than ever, I say that since Microsoft managed to undue years of trust building they had done with their console in only a single day. Somehow I don’t think my son or daughter will forget this, and that they wonder if at some time in the future Microsoft might try it again with and unsuspecting update. So for now they look in wonder at the products coming out but seethe with resentment at what Microsoft thought they could pull over their eyes…

The Amazon Tax

Recently the web, news channels, blog sphere and just about every other media outlet has been abuzz about proposals and amendments now making their way through the house and senate of the US. In a nutshell congress is proposing to eliminate the so called exemption that has existed through court tests and legislation, that has eliminated sales tax, when purchases are made online unless the company has a physical presence in your state. Most ecommerce sites do not have to collect sales tax from purchases outside the states where they have operations. Just as long as the laws have existed that prevent the websites from collecting sales taxes, many brick and mortar sites have been complaining of the unfair advantage that ecommerce sites enjoy. The advent of mobile devices that can search the web for products based on a photo of a product bar code have increased the advantage even more, as brick and mortar establishments have become the showroom for ecommerce. Smart competitors are fighting back by investing in such companies as ‘Sensewhere’ and ‘Point Inside’ that can provide customers with coupons for items that are near their in store position. Many stores, such as Best Buy and Sears, are using slightly different product models that make comparison shopping difficult, and many other methods are being used to entice customers to buy now. That being said, some establishments are still bankrolling the legislation to, as they call it, level the playing field.

There have been plenty of coverage about the fairness the bills would bring about or the disaster just lurking behind the curtain. My take is from a small business standpoint, in particular from a small ecommerce merchant’s perspective. Let’s take for example my state, North Carolina; there is slightly over one thousand zip codes (the preferred way to determine the point of taxation) contained in about one hundred counties. The state determines the taxation point for online sales not by the location of the business, but by the delivery point of the product, so that means that an ecommerce site would file sales tax receipts in over a hundred jurisdictions in North Carolina. The law requires the filing of a return even if no tax is collected (once you start filing you can’t stop). So, as the law stands now, business are supposed to be filing a return whether tax is owed or not. Multiply that by all fifty states and in addition, the filing frequency can be monthly, quarterly, semiannually or annually depending on the revenue.  Some states let you change filing status based on the amount owed without declaration and some states don’t  such as New Mexico, they must tell you how to file (I found that out the hard way and had to refile dozens of returns in New Mexico). Local counties control the sales tax rate or a portion of it, as in my present state of North Carolina, rates can vary frequently and a whole cottage industry has sprung up just to keep in compliance.

Many small businesses are running web sites with razor thin margins already (don’t believe those so called talking heads that say there is millions to be made, it’s a hard business), and now face losing even that margin to compliance, if the new legislation goes into place. I already pay Internet tax, in my state, and it is called ‘Usage’ tax. I record it for every item I buy online. Most accounting software such QuickBooks does not even handle ‘Usage’ taxes. I had to create a hack to properly adjust my revenue collections, the hack can be found here if you are interested. Presently paying sales tax takes about five minutes every quarter thanks to the hack. I have several clients though, that may be facing a daunting challenge if this legislation is passed. There is talk about phasing in various plans or some exemptions for small business but in the end if the legislation passes it will eventually be required by all sizes of business. I know you’re thinking you poor slob, you make all that money and you’re complaining about paying some taxes, well it’s not the taxes that worry me, but the cost of staying in compliance. You either pay a service, pay someone or do it yourself, either way it will cost more to deliver products to customers and so not only will product prices rise but it may also reduce product choices to help pay for the change.  If government would just set the rules and then leave them alone for awhile things would be easier, but if you have ever used tax preparation software or an accountant you know that every year the rules get changed. This is where my beef is, governments continue to look hard for new revenue sources from increasing parking tickets, to hotel room taxes (my city just did that a few years ago) etc. What I can’t understand is why they can’t cut spending like the rest of us do when times get tough. Somehow I just wish we could take the checkbook away from the tax and spend bureaucrats and put it into the hands of people that understand what it means to run a business.

The Timing is Odd for the NSA

The recent disclosure of data snooping by Verizon and now several Internet Companies from articles published by the Guardian in the United Kingdom show that there is probably someone or some entity that is leaking highly classified information about the inner workings of the NSA. What is odd is the timing of the three releases; think about it, the releases are happening right at the start of talks with the Chinese about cyber security. Obama is now in a defensive posture going into these high level meetings and has been put in a difficult position. So one has to wonder about the timing, could these disclosures have been leaked by the Chinese government to soften the approach taken by the US? As they say in security circles, true coincidences are rare.

Let’s take a closer look at some of the information that has been released. First the scope and reach of the information is enormous especially for the cost cited in the NSA presentation of 20 million dollars. One would be hard pressed to build a data center for that, let alone storage capable of holding all of the information alleged to be collected by the NSA. So that puts into question the authenticity of the information released. However that being said, Verizon’s admission that data is being given to the NSA implies the opposite. In reality we may never know the truth. Real or fake, the amount of data storage we are talking about is mind boggling, we are not talking about terabyte size data storage and not even petabyte sizes but more likely tens or hundreds of exabytes (that’s 10 to the 18th bytes). Cisco had predicted that by the end of 2013 that Internet traffic would be about two exabytes per month, Al Gore would be proud… So I don’t believe the articles or assumption that the NSA is storing the data, it’s not practical and in reality they do not have too.

So putting on my engineering hat how would such an unprecedented amount of data be handled, they would index it just like Google does. Google does not store everything, it looks at it and just grabs ‘meta data’, links and some limited amount of the actual data so the data can be found at some time in the future. I mention ‘meta data’ because heads of the Senate intelligence committee mentioned that the data collection was no big deal and was quote “… just meta data”. (Gee what was your first clue Dr. Watson). So what the NSA probably has is a search engine like Google that indexes private information. How is this possible, well think about the private data that is collected by cell phone and internet companies? Those companies may be doing marketing and billing to those customers so it is in their best interest to organize the data for searching by using ‘meta data’ or some other means. Providing the data in this form would provide cover for the companies claiming that there is no direct access and make their statements of denial at least partially true. Your conversation with Aunt Sally is probably not recorded by the NSA, but the NSA might know that you called and talked with Aunt Sally for five minutes from your cell phone while driving home from work Friday night last week, and they also might know that you called your mistress right after your finished discussing Aunt Sally’s hip replacement. (They don’t know that she is your mistress but with some data mining of your bank and credit cards it would not be hard to infer – try and use cash the next time you visit Victoria Secret, it might help…).

Another source of data the NSA may be using is coming from the overseas fiber cables as they enter the US. Theoretically it would be an easy and logical place to examine data originating from off shore and would be legal under the Patriot act. Still, direct storage of this data is again unlikely and impractical; it is more likely indexed on the fly and available by subpoena if the need arises. The most sinister method, besides getting meta data directly from cell phone carriers, internet companies and or through siphoning off incoming fiber connections is the use of fake cell towers or so called Stingray towers. A recent Supreme Court decision upheld the right of grabbing data this way, which basically is a fake cell tower setup between real cell towers by law enforcement and uses a general warrant to justify the data grab (the Supreme Court upheld the use of a general warrant instead of a more specific warrant) and you would have no idea that you were using such a tower. In theory you would place the cell tower in high crime areas and let the computer tell you when it has something of interest. Several large metropolitan areas have been using the technology for years.

One thing that I think many of the articles fail to realize is the depth of data collection, and I am not talking about recording every phone conversion or email. I am talking about the depth due to the diverse media sources. The data is not just cell phone traffic, internet, instant messaging, and email, but, it is also banking and many other forms of communications and transactions. Indexing all these diverse private transactions is much more important than any one phone conversation or email, it allows the government or for that matter a marketer or researcher (if they can get their hands on the data) to build information about just about anyone and connect that to a name with little effort. I don’t think we are there yet since the Boston bombing shows that we don’t truly know everything about everybody, yet… I find it amusing when I read stories about quote “The mark of the beast” biblical reference here, when someone leaves a job because the employee number or badge identification contains or is the dreaded number. It is amusing because there will be no need for a mark of the devil, the devil can track us all with data mining, no mark required.

What I think of all those conspiracy theorist and 1984 (George Orwell would be proud) adherents is that your privacy is not being directly breached, but your behavior and actions can be inferred by the data mining of many seemingly islands of unrelated data. Data mining seeks to relate data that does not have a direct or apparent relationship; it connects the dots by looking at patterns or actions that seem above or beyond the norm. Our own desire to stay connected or reconnect with others has led to our handing the government our privacy without ever agreeing to it. It is not just governments that can connect these data points, but startups and corporations are vying to reach the dream of every marketer, to know everything about everybody. Big brother really is not watching you unless you step out of the norm, what worries me is who decides what the norm is…