I’m pleased to say that The Book of OSM was funded in only a few days!
If you haven’t picked up a copy, there are just 12 days left…
I’m pleased to say that The Book of OSM was funded in only a few days!
If you haven’t picked up a copy, there are just 12 days left…
It’s not the zippiest of titles but Zero to One, the Peter Thiel & Blake Masters duet about how to build the future is a short, fun and incisive read.
Perhaps Quantum Leap would have been better descriptively. Masters was a student at somewhere or other (Stanford at a guess) when Thiel gave an excellent sounding set of lectures on basically how he sees the world. You can read them over here. From the notes came a book.
Frankly you should read the notes. They’re more blunt, free and gives you a feel of being there. If you need it toned down and some sort of narrative structure to hold on to then get the book. Example. In the notes Thiel references the theory that eating carbohydrates is somehow healthy for you as just made up and let us say, influenced, by Kellogg’s marketing department – this isn’t to be found in the book. At least, as far as I could find.
What’s the central idea? It’s that it’s hard to make things the first time. Really hard. But it’s also really profitable. Alternatively it’s easier to take something that exists and iterate on it a little. Or to take something and divide it up.
Building OpenStreetMap was hard. Iterating it and copying it was easy. Comparatively if not in the absolute.
It looks like it was hard to build the United Kingdom but it’s pretty easy to try to divide it up. It’s the mentality that we’ve reached a plateau, things won’t get better and we need to divide up what’s left. Perhaps some sort of socialist paradise will save us – the ultimate division of wealth.
Thiel makes the argument repeatedly that the path to real wealth is to create new things (which as we noted, is hard).
It’s interesting to note little anger in the book or his comments. The outrage in San Francisco over prices of housing are a simple example. Thiel makes the entirely logical and evidence-based argument that house prices are high because it’s illegal to build houses and there’s therefore a shortage. Thomas Sowell does exactly the same thing in more detail in Basic Economics but with a strong hint of frustration and anger.
Should you read this book? If you want to build the future then yes you should, but that’s a demonstrably tiny number of the ~7 billion people on the planet and you’ve probably got it on your list already. If you want to understand how people who build things think then it’s useful too. Sadly the targeted audience and the inspiration it seeks to engender is outside the scope of this or any other book like it save maybe Atlas Shrugged.
And there lies the key question, how to get large groups of people building again instead of dividing and iterating?
I’m pleased to announce I’m on the advisory board of Auth0, a company making authentication trivial. I’m going to get to Auth0 specifically in a minute but let’s talk about how companies place bets.
VC firms, book publishers and movie studios all do approximately the same thing but with different media in different cities. VCs try to find tech companies, publishers find books and movie studios try to find blockbuster movies. Silicon Valley, New York and LA. The problem is, we don’t yet know how to predict the future. Therefore they try to come up with nice stories about how something will succeed or fail and put money in to the things that they think will succeed. Of course, they’re largely wrong on those bets.
Luckily the rewards for being right are disproportionate. Because of the long tail distribution, being right will make you very right, and rich. That win will pay for all the failures. In fact it’s an interesting exercise to think that maybe the long tail distribution of returns is the only way it could work and maybe it’s a long tail precisely because it has to be.
In any case, these firms place a number of bets. Let’s say they invest in ten companies, book authors or movies at $10MM each. Then we hope one of them becomes a billion dollar exit (Google, Harry Potter or Lord of the Rings). That will pay for the other 7 that blow up and the 2 that do ok. Things blow up all the time, like Solyndra or Waterworld.
In this model the firms have to raise the capital to make these bets, either from past lottery winnings or from investors. But when you think about todays service businesses the model is very much inverted.
Instead of you paying to place the bets, the customer is paying you. You have a large number of companies paying you $5/month for some minimal service level and then some of them will randomly take off and start paying you $1,000/month or whatever it happens to be. Thus by providing a very visible self-service model you can expose yourself to some large upside almost automatically. This optionality is interesting; in that your customers are paying you to take the option.
Of course, they can always jump off your service too. But if you’re doing your job they won’t do that; you just have to create different incentives and value models as you go up the stack. You need more features as the price increases, better customer service and so on.
Compare and contrast this to you having to pay to take the bet. Under that model you have to go find the customers where here they find you. You have to build narratives about why they will succeed instead of them doing so. All in all, it’s a lot nicer when they come to you.
Also notice that we’re smoothing the price function. Instead of not funding your movie or funding it as a binary, $0 or $10MM bet, you pay whatever you want. Maybe it’s $5/month, maybe it’s $100/month but we’re still exposed to the upside while covering costs for the low end of the market instead of just turning those options away.
The other thing that’s evolved is the sales process. Instead of me having my bizdev guy talk to your bizdev guy to get business, your developer just happens upon my service and starts playing with it. Instead of exchanging press releases, our developers talk about how awesome everything is. It’s much more efficient that way, especially when getting started. You don’t have to pay for your developer to talk to their PM to talk to their bizdev guy to talk to my bizdev guy to talk to our sales rep. Your developer just talks to my developer. That’s cheaper and quicker for you and for me. We’re reversing the causality here too; my bizdev guy doesn’t contact 100 companies to find 10 that might use the service. The 100 companies just find me instead.
Back to Auth0. I like Auth0 for a number of reasons:
And of course, Auth0 is exposed to the kind of optionality I described above as many others are too. So, if you have any interesting authentication go play with Auth0.
Google shipped an interesting product and pretty website for cardboard. Basically a cheap way to turn your cheap cellphone in to a AR display unit a-la Oculus Rift. Only very crappy with low resolution and high latency; good enough to prototype & play with which is great. You put a phone in it and it pretends to be a VR display.
Someone on Hacker News posited that “Somebody should do a Kickstarter to make and ship copies of this kit for $5 or $10.” So I dug in to it a little. Here’s what my rough bill of materials looks like:
So let’s call it $35. This is roughly half the cost of a Dive unit. And the dive unit actually ships, is made out of plastic and you don’t have to think about building it.
A laser cutter big enough to cut the cardboard is about $11k and at $5 margin per unit you’re looking at needing to ship $80k of these cardboard units to recoup the cost, which I’m assuming would be a reasonable goal. I don’t think anyone will raise $80k of cardboard kits but as ever I could be wrong.
dodocase are flying a kite to sell a unit for $20 which is clearly too cheap without massive volume, unless you can somehow turn it in to a loss leader for something else.
So, in sum, cardboard VR headset cases are kind of irrelevant. The cost isn’t the cardboard vs. plastic housing material: It looks like it’s everything else like the lens units, the postage, the risk, the labor and so on. The PR value is of course very high. There’s clearly tens/hundreds of millions of dollars of PR value out of cardboard for roughly half that in fully loaded headcount and other costs – it all depends how you account for it. The narrative that “Google did something cool” (e.g. cardboard) out of the I/O event is worth a significant sum of money and they deserve all the credit for executing on that.
Over the years I’ve used a variety of devices and come to the conclusion that you can approximate how successful they are in the market with two of their features. That’s it, just two. Device manufacturers spend a lot of time copying each other but it really comes down to:
If you can do these two things, you’ll make a billion dollars.
It might sound like most computers, phones and tablets are capable of this. But no, they aren’t. Most devices die pretty quickly and even today most aren’t capable of talking to an Exchange server or have a unified inbox.
Let’s start with the most disappointing.
The latest Ubuntu 13.10 wouldn’t even install on the ASUS laptop I have (which is a year or two old). After half an hour playing with BIOS settings I gave up and downloaded 14.04 pre-release. That installed, but something called “compiz” sat using 100% CPU and draining the battery. Using a decade’s worth of experience, I fixed that. Neither Thunderbird or Evolution email clients will talk to Exchange out of the box, but there is a variety of contradictory documentation on the web about how you might one day get that to work. When you send an email in Thunderbird it sits there with a server communication dialog rather than getting out of the way and sending in the background. Upon closing the laptop and reopening it, it crashes and sends a bug report to Canonical (the makers of Ubuntu).
Does it turn on? No. Does email work? No.
Surface & Laptop Windows 8.1
Same laptop as above, installs fine. Updates itself. Can turn on and off and even hold battery charge when closed. Modern email client looks great but for some bizarre reason doesn’t have a unified inbox. Surface dies within days of sitting on a table top.
Does it turn on? Sort of. Does email work? Close, but, no.
Nexus 7 with Android Rainbow Sandwich (or, whatever)
The battery dies within a few days of leaving it idle on a table. No unified inbox I could figure out, pushes gmail on you.
Does it turn on? No. Does email work? No.
Kindle Fire HDX
Battery life is better than the Nexus 7 but still dies quickly. Unified inbox! Exchange works out of the box! But, for some reason, the email client keeps switching away from unified and in to each individual inbox when you tap on email. Maddeningly, you have to keep going back to the unified inbox to see all mail. Amazon have done a great job with this, but it’s just not quite there.
Does it turn on? Almost! Does email work? Almost!
You can leave the iPad for weeks and it will still have some charge. Unified inbox works smoothly and Exchange works great. If you have 10 email accounts and you’re offline the thing will spam you with (at least) 10 dialog boxes saying it can’t connect to your email servers. My Powerbook is just as good.
Does it turn on? Yes. Does email work? Yes.
The worth of computers and tablets really comes down to their ability to help you communicate. To be able to do that, it has to be able to turn on. Email is the primary way we communicate today and it has to work flawlessly. Few people are down to one email account and Exchange is the best-selling (and only, really) email server you can buy. If it can’t do unified inbox and Exchange, it doesn’t work.
Amazon and Microsoft come very close to getting there. Amazon’s customer focus shines through on the HDX and is a hair away from having a device which works. Modern Mail on Win8 is similarly close but probably self-restricted to make sure it doesn’t compete with some feature or other in Outlook.
Why am I willing to pay two or three times as much as those devices for an iPad or a MacBook? It’s not for Pages. Office is great, OpenOffice is acceptable. It’s not because it’s shiny; there are shiny Ultrabook PCs now. It’s not because the iPad is a great piece of hardware; the Dell Venue 8 is a very comparable tablet.
It’s because they turn on, and because email works. All the UI stuff, the APIs, the app stores, the marketing budgets… All that stuff it secondary or tertiary and I’m back to my MacBook and iOS devices.
“You don’t see anybody competing with Google on the level or quantity of their mapping today,” says Coast, who now works as a geographic-information professional. But, he adds, “that’s because it’s not entirely rational to build a map like Google has.” Google does not say how much it spends on its satellite imagery, its planes, its camera-equipped cars, but clearly it’s an enormous sum. O.S.M., by contrast, runs on less than $100,000 a year. Google’s spending is “unsustainable,” Coast argues, “because in the long run, this stuff is all going to be free.”
And, my favorite:
In June, Google bought the popular social-mapping app Waze for close to a billion dollars. The product can be thought of as a Twitter for traffic jams…
Concise and brilliant as ever.
Lots of people have been experimenting with making their own aerial imagery over the last few years. Technology (cameras) and platforms (anything that flies) have been coming down in cost dramatically. This is useful if you live in a disaster area or want to do something fun on the weekend.
Personally I’ve never had a need to make aerial images as I’ve lived in areas covered by people like Bing and Google. Therefore all the technology, kites, drones and rectification has mostly passed me by as something of a cute sideline. Sure, theoretically you could do it yourself but you really need a few hundred million dollars of aircraft, cameras, people and computers to do it for any real use case.
I live in an expanding area which means imagery is dated fairly quickly. Here’s what Bing shows for my area:
We’ll jump ahead so you can see what I now have. Then we’ll back up on the process:
Also, notice the difference in color. Green indicates the summer. Bing’s image is better in many ways. For example, it is much more vertically-down and doesn’t smear the side of buildings over the image.
How did we get here? First, it helps if you have a pilots license or easy access to someone who does. Then you wet lease a plane (meaning; fuel included) and take a bunch of pictures. The plane will run around $150/hour and you can pick up a decent DSLR for a few hundred dollars. Here’s the image we start with:
Next we go over to mapwarper.net and upload the image. You do that, and add a bunch of control points that map the image you have to the flat top-down openstreetmap. What this does is take your image and flattens it out in to a map you can use.
We’re still very far from being able to do this en-mass, however. The costs and barriers to entry are many:
Mapwarper, OSM, potlatch and the rest are all awesome. They’ve taken us from “impossible to make your own map” to merely “very hard to make your own map”. I’m just impatient and want “any idiot can make their own map”.
What would be wonderful is; I point my iPhone outside the plane and take pictures. The phone knows its position and altitude and its roll, pitch and yaw. This gives us a good start on the image location. Mix in some topology and make the images overlapping… and we go a long way to making this a simple anyone-can-do-it process. The phone has a radio in it and a decent processor, it can do some work by itself or just upload it to a service which does a lot of this automatically.
On the other hand, the way imagery is collected today is based on a set of assumptions like vector mapping was 10 years ago:
So, think what we can achieve in aerial imagery if we relax the constraints of today’s sources and use cheap COTS (commercial off-the-shelf) hardware (iPhones).
Your transportation costs are best thought of per-mile. Most Americans apparently have a much more vague and forgetful way of looking at it; car payments and gasoline are just a background fact of life.
The Federal Government will refund you 50 or 51 cents on the mile which is a decent approximation. That builds in purchase price, maintenance and fuel. So that 10 mile roundtrip to the grocery store is a $5 cost. But we can go deeper than that.
Because I was drunk, stupid, or both I bought an electric bike a while ago. The theory was I’d use it because of the crazy hills on the commute from home to work. The reality was the rain was so depressing I rarely used it. Along the way, I kept a spreadsheet.
I got the bike at approximately half-price as it was second hand. From there I recorded all my trips. Right now my cost per mile for the bike is $5. Yes, $5 per mile. I need to ride it another 2,300 miles before it comes close to Federal reimbursement levels. Moving as I have to Colorado, it’s now almost entirely useless. The boost going up hills (and there is only one near me now) doesn’t outweigh the unfortunate speed limit built-in. It tops out at 20mph or so, when I can get up to 35 on my other bikes down hills. This is some safety constraint imposed on electric bikes.
It’s been fun, but it’s not worth $5/mile. I’m mainly using my normal bike now, every day, and will be selling the electric thing.
In contrast, my car (we’ve gone from three cars to one) is currently costing $1.74/mile. This includes again, the purchase price, gas and maintenance but it has a higher error bar since I didn’t keep track of all the costs exactly. Over time this will drop as the purchase price is amortized over the lifetime of the vehicle.
It’s much easier biking to get groceries knowing that I’m saving $10 or $20 of driving costs, rather than thinking of the car as “free”. As the saying goes; a car burns gas and makes you fat, a bike burns fat and saves you money.
Compare and Contrast
United Airlines will fly me from San Francisco to London, and back, tomorrow, for $2,647. At 5,367 miles each way that’s 25 cents a mile with the added benefit of food and speed. If governments didn’t interfere so much, it would cost half as much again (about 50% of the cost is taxation).
So my electric bike costs twenty times what a 777 costs, and my car costs seven times a 777.
If only I could take a 777 to the grocery store.
When you look at the last, say, 40 years of mapping in the United States it’s hard to see that the central problem of mapping has changed. The consumer wants to get to work on time. That’s about it.
We can nudge that scenario in to “…wants to get home” or “…wants to see the ball game”… or whatever you want. But, centrally, all I care about is getting from A to B. Where A or B tend to be something like my home, my office or someplace else like my kids school. Only rarely are A and B some other random thing unrelated to my daily life.
What’s changed in the last 40 years is the technology. We can imagine that in 1973 the hot technology was paper, as it had been for about the previous two-thousand years. Paper is incredibly cheap, lightweight, hardy and high-resolution.
Somewhere in the suburban time frame radio traffic reports emerged. This was a great way to make me tune in to certain radio stations. Now, I not only have a framework for figuring out a route (paper), I also have some approximation of the time it will take. Thus, I can choose which route to take.
Let’s pause and emphasize that. The primary piece of information I need to know is binary. Do I take route 1 or route 2 home today. That’s it. That is the major, most important use case for mapping. Everything else, checking in, finding a McDonald’s and so on is far less important compared to the one thing I need every day.
Radio reports are a pretty crappy ways to convey the nuance of traffic information. But then, I don’t care. My route to work has two or possibly three variations. So crappy (low density) information is fine. The problem kicks up with frequency. Is information every 10 or 20 minutes useful to me? No, so they give traffic reports every five minutes which makes them super repetitive. A vast infrastructure emerged to include helicopter traffic reporters.
What happened next? The world exploded, approximately. We’ve seen a bazillion different mapping apps and services, most have died, most are trying to do the same old thing; tell me how to get to work on time.
Enter TrafficGauge. Founded in 2001, a full six years before the iPhone shipped. The screen shows traffic, the button looks like it was a backlight. What’s noticeable about the product post-hoc is how damn simple it was. A screen and a button. That’s it.
Using the pager network, the device magically showed you where traffic was bad for something like $80 per device and $5/month. They shipped in something like five markets in the US. This is all a little sketchy because, shockingly, there is no wikipedia page. I’ll link to where it should exist one day though here.
So we’ve gone from paper to radio reports. Now we have in-car devices which explode thanks to TomTom and others and in a sense died with the launch (and quick death) of Dash.
Dash, like TrafficGauge, was a beautiful device but far easier to spell. It included a radio, like TrafficGauge, but this radio could transmit things as well as receive. What did it transmit? Primarily, your position. But, it also meant you could do searches and other stuff. By using your position, Dash could in theory figure out the traffic speed around you. It used you as a probe in the outside world and then could tell drivers behind you how bad the traffic is in front of them.
Why do we need this vast infrastructure? There are two reasons. One is, traffic data is kind of monopolistic and expensive so having more sources is a good thing (where good means cheaper). The other is that the cutting edge of traffic information was induction loops.
Induction loop is a fancy term for “piece of wire buried in the road” which, with a little logic, you can use to sense cars. At least, until carbon fiber cars become the norm. Various governments install these things in every lane down a freeway every mile or so and can thus detect flow rate of vehicles. After a lot of work, you get to know which freeway you should take home.
Putting probes out in to the world would be better, so long as we have sufficient numbers of probes. Thus Dash died under the weight of product development, hardware engineering, software and also having to sell enough units to be self-sustaining.
As Dash died, the iPhone and friends took over. That meant waze, google maps and much more.
Look how the information density has crept up on us from audio reports over the radio, to TrafficGauge, to the vomit-on-a-screen above.
The industry went so far beyond the required information, and got so slap happy with the available tools, it reminds me of when laser printers came out. Leaflets using every available typeface and color were normal for a year or five, then we regained our brains and sense of information design.
Think for a second what I actually need to know when navigating. It’s basically down to two modes – unambiguous and ambiguous path decisions. When I’m on a freeway at 70mph I only, really, need to know unambiguously if I’m coming off at the next exit or not. That can be conveyed with an arrow, and maybe some confirmation data like the exit number or name. I only really need confirmation data because the map data might be wrong, or we slip in to a complicated exit scenario like the following city example: When I’m in San Francisco and I have traffic everywhere, bad GPS reception and I’m eating a burrito, things become more complicated. The GPS is telling me to turn left… Does it mean this left or that left? At this point a map is suddenly very useful, in a limited infographic kind of way, to disambiguate the device, reality and my mental model of where I should be going. Snap, when all three of those agree good things happen.
Who is the above map useful for? Nobody. As a pedestrian I don’t care much about the traffic. As a driver, the information isn’t condensed enough to things like left or right turns. What it is (and it’s not just Google, everybody makes online maps like this), is an exercise in punishment-by-brogrammer. Look! I can add colors!
So, here we are 40 years later and I still have the same problem. Which route do I take home today? Only now I’m overloaded with information and the solution costs infinitely more than it used to. The radio traffic report was approximately free, TrafficGauge was $120 ish fully loaded and now an iPhone costs $2-3,000 fully loaded over the life of the contract.
Yes, your iPhone does so much more. These devices have hoovered up entire industries. Where I used to own a camera, GPS, phone, mp3 player and video recorder I now have an iPhone. Let’s divide the cost in five, and we still end up with $400+ for the mapping functionality. Therefore the costs have jumped two orders of magnitude, the problem I’m solving remains the same, and the density of information has jumped – overshot – to a point far beyond my actual needs.
You can buy a brand new GPS for $150 with lifetime new maps and live traffic. We can wave our hands and call that half the cost for the same services delivered by an iPhone. We can get similar things far cheaper on eBay. If you’re at all rational, a GPS is the better choice for your car.
When I see terms like “lifetime maps and traffic” I feel that there is some level of desperation out there. Here they are giving you the farm; the device and all that data and updates for less than a third of what the device alone used to cost. Your cell phone on the other hand is giving you less distilled information, for more money. It would appear inevitable that the pendulum will swing the other way and we will get simpler interfaces, cheaper, with more distilled information. Perhaps the new Google Maps is a leading indicator of that.
When maps were made out of dead trees, they needed to show every street. They only show every street today, because that’s what we did back in 1846. There is no actual reason to show every street on a mobile device if you’re attempting to accomplish some task.
For entertainment purposes, please, add every street. When I’m browsing around, or finding my bearings, this is useful.
But as soon as I want to achieve something, a map is just information design. I don’t want a map. I want to find McDonald’s, or I want to get home on time. A map is just a crappy tool to help me achieve these tasks.
We can make much better tools than exist today.