Vol. 6 No. 4

November, 2006


HP Scandal

iToon on Voter Spam

You Tube Me Rich


Haunting Image

iToon on Back Ups




Don't forget to check out the







When a board of directors of a major corporate has a major meltdown, the underbelly of myth of bright public governance is exposed in the press. Hewlett-Packard, a tech titan, has numerous news leaks to the press. The Chairwoman of the Board was so upset that she hired investigators to find out who was leaking confidential board discussions. The investigators allegedly used electronic surveillance, illegally gathered phone records, and a host of other privacy invasions in order to track the sources of press reporters. The investigators alleged looked at the private phone records of reporters and their newspapers to match the private cell phone numbers of their own board members. The spying was both internal to the company and external against private citizens. People are aghast at the amount of information that these investigators gleaned through the use of technology and the internet.

A few general observations on this scandal. First, spiteful board of directors or any individual with a grudge can hire investigators to dig up dirt on anybody, using any means. Most victims probably will never know the nature or extent of their privacy invasions. Most people do not realize that their entire lives has been digitized and databased. Every time you swipe your credit card to make a purchase, someone somewhere has a record of what you bought, when you bought it, how much it cost you, where you shopped, etc. Data miners can cull this empirical data and create consumer profiles to sell to hungry telemarketers. Telemarketers can attempt to sell point-specific advertising and products based upon your individual buying profiles. Second, while firms stress security in their customers financial, health and personal information, aggressive investigators can breach electronic barriers easier than walking into an office, opening file cabinets in HR to get your personal information. Third, the attitude of the power elite was first arrogant: it was the terrible negative news stories in the press that was hurting the company (i.e. the stock price which in turn hurts the executive option value, compensation, etc.) Then it was the excuse that we did not know what the investigators were doing was wrong or illegal. Then to the cop out our counsel said it was okay so we in good faith can justify any invasions of privacy.

Criminal charges are pending in California against the company, individuals and the investigators. Which leads to an unanswered question: if the investigators did this type of job for HP, what other jobs did they do for other Fortune 500 companies? This may be the tip of the corporate spying iceberg.

It also throws into the spotlight a clear principle. Workers at the job space have no expectation of privacy. An employer has the right to monitor the activities of its employees, and how they use company resources.
This would include the use of the company phone, fax and computer Internet usage. There are various monitoring software (spyware) installed on company intranets for the sole purpose to check to see if employees are violating company policies. There are also various firewall and program blockers that limit where employees can go on the net. There are some firms that have strict email protocols which prohibit in the old harmless joke-fax from being forwarded through the company directories. Companies are paranoid about liability and misuse of their resources by employees. In the HP case, that paranoia may have boiled over to outside the walls of the company realm.





The fast money era returns with short bursts of unreality. The founders of the web site, YOUTUBE, a video upload-sharing content host, was sold to the founders of Google for $1.65 billion in stock. For a company that is less than micron old in the corporate timeline, it was a huge pay out. Why the huge price for a dot com in the conservative 2000s?

First, the Google guys are printing their own money - - - the GOOG stock is still high above $400/share. The new business model was to print stock shares and sell them to the public, exit when the SEC rules allowed, and pray the paper napkin business model will hold until the new board of directors, Wall Street institutional investors and M & A guys push you out the door with another golden parachute. The priority of the day was to concentrate an exit strategy before even thinking about whether the business or service could make a profit. In the go-go stock market, the latter objective was merely dropped. The money machine was the stock market and perception of the new economy was enough to create instant billionaires. Flash forward a decade, and now perception is enough to create instant billionaires. Instead of stockbrokers peddling freshly printed stock certificates, the YouTube founders received the purchase price in Google stock, the new technology currency of choice. Who needs greenbacks when you can get your hands on appreciating Google shares?

Second, it was another of those porism acquisition. YouTube quickly ascended to the most popular video web sharing site on the net. Analysts and pundits kept chirping that video will be the next-great-thing like the iTunes store was to the music biz. YouTube has an estimated library of 100 million videos. It has an easy user interface, and a rating-ranking system that has replaced the funny fax chain letter in corporate cubicles. On the positive side, the site was receiving free content; people would upload video that the public created, extracted or archived from their personal video-TiVo-DVD collections. Free content is a great find in any business model. On the negative side, the site apparently was not making any money. Ads on home page? Not that I could recall. Networks and distributors paying for access to the site? Not that I could recall reading about. (Usually, it is the other way around). With the amount of server space and bandwidth required to service 100 million hits a day, the “cash burn” had to be in the millions of dollars per day. So it had the classic dot com characteristics: a hugely popular site but with no real revenue stream.

Third, there was a possible bidding war brewing for the web-video market. Potential buyers like Microsoft or Yahoo would have liked to add video to their product lists. But Google has more “currency” for this risk, so it could afford to overpay by 3x, 4x, 5x, 6.5x, 165x or whatever history will determine would have been the fair price (as opposed to the market price). So Google was trying to take out the competition before there was competition for the video web space.

Fourth, it is part of the model media that caters to the social networking scene. News Corp paid a lot for the social web blog service,, for the name recognition and an attempt to push other News Corp assets and advertising to the youth with disposable allowance money market. The idea is that a major media company can push its advertising, banners and animated billboards anywhere where the eyeballs are trained; in this case, next to video windows. Google's only revenue stream of note is the ads which pop up next to its search results. One can assume that it will try to leverage the same format to the YouTube pages. (Some other content creators have placed advertisements at the beginning of their video or animation shorts like a movie theatre during the previews. But the YouTube model was having the amateur net surfers upload what they wanted to share, and not cut and paste purchased ads into the video uploads.)

Potential. That is what the sale was all about. Napster had potential to rock the music world. In some ways it did; it created a wolf pack of copyright lawyers ripping the service for illegal copyright infringement into bankruptcy and reconstruction into a nominal web music store. There were a bunch of Napster clones, peer to peer file sharers to industry sponsored pay per download music sites but only one company, Apple, has conquered all the hardware, software and content issues with the ease of its iTunes store. Now Apple is expanding from music, to music videos, to television shows, and now to full length feature movies. Apple is on the playing field with professional Hollywood production companies and artists. The YouTube content providers are independent producers or in some cases alleged infringement of copyrighted programs. The founders of YouTube are smiling all the way to the bank; any Napster problems, competition or fad implosion are no longer their concern. Those crazy, free spirited web surfers made them multimillionaires.



Remember those “hanging chads” in Florida after the 2000 presidential election? Election judges on live television holding punch cards to the ceiling lights to determine if there was a significant hole, indentation or other mark which could be conclusively shown as being a voter's intention to cast a ballot for that candidate? It was a bizarre political theater, which wound up in the courts, with the U.S. Supreme Court calling the election for George Bush over Al Gore. But what was comforting to most citizens was the fact that there was actual physical evidence of the votes cast by the Floridians. There are checks and balances when one votes: show up to your polling place, sign an affidavit of who you are on the registered voter sheets, get a numbered ballot from another poll watcher who checks off the ballot number on his/her list, then take the ballot into the booth and punch your choices, then feed that paper ballot into a machine that tabulates the choices, and saves your ballot in a lock box. Then after the election, each precinct is “canvassed” or polled to determine if the voter records are accurate. So with each one of these steps, based upon historical relevance, it is very difficult to hijack a ballot box. (There were numerous stories of massive voter fraud during the Bush-Gore election, but it came down to Florida in the electoral college and the media made a beeline to that story.)

So what happens to citizen confidence if you go to your polling place, and you finger punch selections on a glorified ATM machine. There is no paper record. No tangible proof of your votes except for some magnetic binary symbols on a flash drive. The critics pounce on the fact that machines can be manipulated, reprogrammed, programmed with errors, or just crash losing the valuable data. In a democracy, what is as important as a citizen's vote being counted correctly? In third world countries, people have died trying to exercise this basic tenet of citizenship.

In local elections since Bush-Gore, government officials pushed for e-voting machines to eliminate the hanging chad problem. The electronic voting solution brought upon more critics than the paper recount foes.

Electronic voting also puts another layer of bureaucracy for any independent voter who wants to write in a candidate for office. With a paper ballot, there was a place to physically write in your new vote. With the electronic machines, the idea of writing someone outside the programmed selections is uncertain. In some states, like Illinois, where the two governor candidates have approval ratings lower than George Bush combined, a viable independent candidate (like a Libertarian) could garner significant votes. But the difficult state election code knocked out the state Libertarian Party as being not viable; meaning that in order to qualify for the ballot, a governorship candidate would have to obtain hundreds of thousands of nomination signatures. So the Libertarians are stuck with only a last minute write in candidacy. (The Illinois election is so up in the air that the Green Party candidate is polling near 14%!) Now the Democratically controlled state does not want any third party protest votes inferring with their projected windfall against their weak Republican rivals. Electronic voting has the possibility of adding another roadblock to independent voters for the benefit of major party incumbents.

There is a huge problem of collaboration. In recent e-voting elections, the machine tallies did not match the roster of voters at the precincts. In other areas, the machines were too confusing to some voters who at the end of the touch screens may or may not have their selections tabulated by the machine.

Further complicating things is the fact that with paper ballots you can hand count close elections for errors. In an electronic system, there is no paper trail to verify the ballots. Critics say that software hackers can manipulate the electronic tallies. In an odd report, the election board in one county admitted that its electronic eligible voter database would be immediately erased after the election. So even a simple number comparison with an electronic trail of registered voters would be gone. This new system is gathering more suspicion than a Hitchcock movie.



There are times when you are channel surfing in a half-catatonic state when suddenly a image pops up on the screen that deploys the airbags of your frontal lobe in instantaneous recognition. It was one of those mid-October, pre-Halloween type shocks. Readers are aware of our tech guru, Rocky, a technophile educator who runs sites like descendingspiral, techittothelimit and communicating tech. The latter site has a graphic of him. So late on a Wednesday night, this image pops up on the television:

South Park Image from

I was floored by the image. I immediately thought of sending a cease and desist letter to the producers of South Park. They are stereotyped a techno-geek with the image of our guru! Right down to the quarterback play wrist band! Don't steal my technoguru image!!






The Sultanate of Clintonia-Rogstaden

The global on-line gaming experience has quietly exploded into a a bandwidth python of multi-hour, multi-kingdom game spheres. Whether it is the team combat arena, or the total simulated fantasy genre, more and more men and women are using their free time to escape to a virtual world. As a result of our tech guru's prodding suggestion, has created Sultanate of Clintonia-Rogstaden. Readers will have a running update of the status of this virtual country; get the backstories outside the game's program. For example, check out the images of the national currency. There will be inside jokes, satire, humor and pulse of a real bizarre country. New features will be added on a regular basis. So check out the cyber-soap opera of nation building here at

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