Andrew Ferrier’s Blog

Anyone want any free energy efficient lightbulbs? I keep getting spammed with them by British Gas, Southern Electric, et. al., in a desperate attempt to prove their green credentials. Of course, it doesn’t work - I already have all I need and they are now piling up in the cupboard (here’s a hint: maybe that ain’t so green).

The law of unintended consequences is a bitch.

A post on the Economist’s Free Exchange blog - about Adam Smith’s house in Edinburgh going on sale - reminded me of a childhood fantasy, and caused me to think how it could be brought up to date.

Adam Smith (and many other free-marketers since) have had a lot to say about the ingenuity of the human spirit and the market’s ability to do a better job of enriching humans than central planning. Nevertheless, I sometimes still wonder about the extent to which new ideas are sometimes missed, even in strong market arenas, because existing ones are taken for granted.

If Adam Smith could be brought into the 21st Century, with a time machine (this is where the childhood fantasy comes in), what would he think? After the initial shock had subsided, would he be pleased with the globalised world we’ve built, or would he be disappointed by general economic ignorance?

But here’s the real puzzle - if one showed him that it’s now possible to get from London to New York in 7 hours, would he be impressed with what we’ve managed to do with that capability, or disappointed? Would he think it’s cool that we can eat fruit from the other side of the planet, or think that the human race is hardly stretching itself?

I’d love to know.

Every time I get sad about the illiberal attitudes of the public sector in the UK, at least I can reassure myself that I don’t live in France.

Amazon have obviously got just as sick of Royal Mail as I have. They now seem to be using the Home Delivery Network instead for large parcels. I’ve just had some network kit delivered - on a Sunday! What’s even more impressive, I picked the cheapest delivery option available.  There’s also online tracking available.

Roll on postal competition.

I’ve been interested in photography since I was small, progressing through a simple fixed-focal-length compact camera to a basic 35mm SLR, playing with many cameras, including SLRs and compacts, and now back just to a digital compact camera I quite like. I’ve found digital sufficiently liberating that it has re-invigorated my interest in photography: primarily because it makes everything easier and cheaper. (Maybe one day I’ll invest in a 35mm digital SLR but I still want something smaller). Even my new phone has a camera that’s worth a second look.

Flickr, of course, has been a great success story of recent years, providing a simple and cheap way for anyone to upload and share photos. They have got the balance just right between the man-in-the-street and the enthusiastic amateur, so much so that many professionals now inhabit Flickr (don’t be fooled by the ‘pro’ logo, though; it means nothing more than that a subscriber is paying for more space - which is what I do). They’ve also spent a considerable amount of time getting the social aspects right, so much so that it’s easy to spend hours browsing Flickr for funky photos and talking with other keen photographers. Many of my friends are also into photography and most of them have Flickr accounts.

At the same time, Flickr makes it trivial to access mountains of excellent content that most photographers would be rightly jealous of. I’m proud of some of my best photos, but it doesn’t take long on Flickr to find stuff that’s miles ahead.

Despite the legal, moral, and practical issues involved in copying a photo (see the Creative Commons page for an indication of how unnecessarily complicated it can be to understand), I can’t help but think that all of this will reduce the average cost of a saleable photo for a professional photographer - whether they choose to participate online or not. In fact, it’s easy to see that this is true, simply by observing the rush of online stock photography websites selling stuff for pennies. Put in other terms, it makes it easier to become a professional photographer, whilst making it harder to make money from it. It’s a good substitution argument - if I don’t like the price you’re charging for your pretty picture, I’ll find another one (and Flickr and the web makes it easy). It’s no coincidence that the consequences of this digital enablement roughly mirror the struggles and increased opportunity that many music artists are going through with the rise of online music, file-sharing, etc.

None of this is designed to discourage anyone. It’s got to be more satisfying to beat the world than just those lucky few who can afford a camera. But like much of economic progress, the commoditisation of good photography is going to be easier for the consumer (viewer) than the producer (photographer).

It appears that Starbucks is finally coming to Winchester. No doubt many will lament over this further Americanisation and homogenisation of our high street, but I’m kinda curious.

For a long time, Winchester’s most obvious and best option for coffee (in my humble opinion) has been the equally sterile and characterless Caffè Nero chain. There are a few other chains and independents around, but they’re all weaker for one reason or another (low ceilings, no air-conditioning, dirty tables, etc.). Starbucks will become its most obvious competitor, located only a few doors down, and will hopefully shake things up. It’s interesting how Caffè Nero’s dominant position has allowed it to get away with some things - the lines are always far too long, and the staff slow and inefficient. I see this as a practical example to observe how change in markets works, that wouldn’t be possible in a larger city with less incumbency and more turnover of residents. It’s going to be curious to see what happens, and I’ll be one of the first in Starbucks’ door.

The political arguments around government and business are well understood. At one extreme are people who despise profit-making businesses, considering them a necessary evil at best, and who’d prefer to see governments take more action to protect their and society’s interests. At the other are those who’d prefer to see governments scaled down significantly and businesses given more freedom.

People with my political opinions often make arguments for the latter based on either practical or moral arguments. Richard and I had a online discussion about this recently. But maybe there’s another, more silly, question that’s missing: which is sexier: business or government? A quick look at the primary US government portal compared to Wal-Mart’s homepage leaves me in no doubt who hired the better web designer, at any rate (and Wal-Mart is hardly an example of glamour). Which corporate body makes you want to interact with them? Anybody who’s spent any time at a UK local council, with their cuppa-and-rich-tea-biscuit image, will know what I mean (that’s an example of non-sexiness, if it’s not clear: not that I have anything against rich tea).

I’m semi-serious, actually - this does matter - it’s an issue of marketing. Clearly a company cannot actually be sexy - only people can be that. But the Virgin family of companies gets pretty close - and not just because of the suggestive naming. It’s an image that has been carefully cultivated by the folk at Virgin. Virgin is a company that you want to like (well, I do, anyway), irrespective of the fact that their trains don’t run on time.

I think the reasoning behind this is simple. Companies have to be sexy - or at least, they have to project an image which is aligned with values their customers want them to have. Sometimes this is sexiness - and Virgin is a prime example of a brand that’s attacked several markets with that technique and won some new custom. Sometimes, to be fair, there’s another image to be conveyed (UPS brown vans and brown uniforms are not alluring; but they do project an image of reliability). Conversely, government has no such motivation to project an image of anything - or at least the vast majority of unelected officials don’t. There’s no requirement to improve, no motivation to act like a marketer, because there’s no competition. Thus, government will always continue to project an image of dull and incompetent, whether that be the case or not. As Seth says, ‘[people] lose their jobs because of boring marketing’ - except in government they don’t, because they rarely lose them at all.

It’s probably not the most pressing problem the world faces right now, but wouldn’t it be nice to stop worrying about global warming for five minutes and think about how to make the institutions we deal with on a daily basis more appealing?

Today is Milton Friedman day. Friedman is a personal hero of mine, an economist who worked hard to publicise the concepts of freedom and liberty, and who sadly passed away last November. His clarity and forthrightness in explaining his beliefs to the layman won him praise, and deservedly so:

The most important single central fact about a free market is that no exchange takes place unless both parties benefit.

Milton’s son David is also an economist, and continues to promote his ideas on this blog. The Economist has also drawn up an interesting selection of quotes discussing Friedman.

Note: Milton Friedman is unrelated to Thomas Friedman, author of The World is Flat, a book which Roo Reynolds wrote a partial review of recently.

A long discussion with plv the other day about open source and what it really meant got me thinking about that model when applied to other domains, such as mapping.

Google have clearly made a success of Google Maps (I’ve discussed Google Maps before as compared to Multimap - not entirely favourably - but whatever I think, the market loves the former). Plenty of competitors have also sprung up, notably from Microsoft. Incidentally, Flash Earth brings together all of these services into one ultra-slick interface; although I’d still love to see them available on Jeff Han’s touch screen (iPhone, eat your heart out - your interface is nothing on this).

However, one thing all these services have in common is that the mapping data is (as far as I can tell) commercially licensed, ultimately from a governmental institution. In the UK, we have the Ordnance Survey (who actually produce excellent paper maps, even if their customer-facing technology is a little backward). The Ordnance Survey gets its revenue from licensing data, selling maps, and so on, rather than from general taxation (which is something that as a libertarian I can almost approve of; although it does raise the question of why the government needs to be involved at all, since there’s therefore clearly a market for the data). The closest equivalent in the US appears to be the USGS (which also has other functions).

It always used to be conventional economic wisdom that mapping (or, to be more precise, surveying) was a function that had to be performed by government, because it was so astronomically expensive - in other words, it cost more than the direct revenues one could possibly obtain (presumably the indirect benefit to society is supposedly significant, which is why we engaged in it). Whether you agree with the morality of this depends on your political views, but it is at least plausible. It’s interesting to see that the Ordnance Survey no longer seem to operate on this model, but clearly many folk still believe surveying should be done centrally.

Now technology might be able to change all of this. OpenStreetMap is showing how it might be done - using cheap GPS receivers, driving along streets, and plotting the resultant data (yes, I know the receivers rely on expensive satellites; but there are only a few of them; and they’d be there anyway). Obviously there’s a long way to go, as shown by the short list of places that have been mapped. There are obviously also concerns over completeness, accuracy, and so on (although most of these have an analogy in Wikipedia, too). However, the potential for these maps is huge if the concept does take off - Google Maps mashups would have nothing on the potential richness of data available. The real concern so far has to be over how many people are really interested in creating this data and keeping it up to date.

As with all futurology (aka: guesswork), time will tell.

Update 2006-01-16: A recent edition of the BBC radio programme In Business (available as a podcast) took a rather quaint look at open-source. Worth a listen as a discussion of how hard open-source is to sell, although not as a rigorous discussion of the technological and legal issues.

TEDTalks has hit a home-run again (seriously, I can’t recommend this series of videos highly enough - whatever you think about whatever else I’ve written here, you’ll find something you like). Bjorn Lomborg, who’s not a stranger to controversy, explains in this 2005 TED presentation why climate change, relative to the world’s other great problems (e.g. disease, sanitation), isn’t an efficient problem to solve. This is a finding of the Copenhagen Consensus, who expended no small amount of effort on the exercise. He makes very clear what the ranking means - not that it isn’t desirable to ’solve’ climate change (it is) but simply that it’s inefficient - there’s more bang for the buck in ’solving’ free trade or controlling HIV/AIDS than in solving climate change.

Bjorn is an economist (my favourite type of -mist) and I know this doesn’t bode well for the acceptance of this theory: primarily because economics has never done a very good job of publicising what it’s about, and so there’s a frequent misconception that it’s something to do with money. The typical reaction to the conclusion above is that economists only are only looking at the monetary side of things. Well, yes, that’s true, but it’s also the whole point. Economists put prices and costs on all kinds of things that many people don’t (life or death, polluted air, a loving relationship, etc.). Of course one can argue until the cows come home about the what those prices and costs are: and everyone does (even when they aren’t quoting them in dollars or pounds). But the money is only used as a number, as a symbol.

If we were to try and rank which we wanted more, an orange or an apple, we could probably do that. In fact, we could probably say how much more we wanted one than the other (twice as much - give me two apples, and I’ll exchange you an orange). Introduce a banana and the decision becomes more complex, but the principle doesn’t. This is all prices are - a way to trade off one alternative against another and allocate resources (which is similar to the definition of economics you’ll find in any textbook).

This is why it isn’t really callous to rank the world’s big problems and say that maybe climate change doesn’t deserve so much attention. At the end of the day, the world only seems prepared to spend so much time and money solving problems. Doesn’t it make sense to solve the ones that gives humanity the greatest degree of progress, health and prosperity?