Gates and Jobs: the interview

In a rare appearance together on the same stage at the same time, Bill Gates and Steve Jobs discussed each other’s contributions to the technology industry.Bill Gates and Steve Jobs discussed each other’s contributions to the technology industry.

All Things Digital hosted the event and its website provides a transcript of the event. Here is the highlight reel:

Besides allowing viewers to get to know both individuals and what they think of each other, the interview covers a lot of history of the personal computer, software development, standard adoption, and other subjects with which students might not be familiar.

 

 

Netflix throttling

[F]or a company like NetFlix, frequent customers are less profitable than other users. NetFlix customers who return their movies more quickly, require more service, and incur additional shipping costs, reducing profitability. Each DVD mailed and returned costs the company 78¢ in postage alone. There are other processing, handling, and breakage costs as well.

So what does NetFlix do? They use a poorly named “fairness algorithm” to slow down deliveries to heavy users, preventing them from watching, returning, and ordering even more movies. By reducing interactions with these customers, NetFlix reduces its costs and increases its profits. This is the kind of bottom line thinking that makes accountants proud.

Here’s the problem: NetFlix’s heavy users are also their most likely heavy promoters. (Brand Story)

Nobel Prize: Money not the whole story

When he was awarded the Nobel Peace Prize last year, Yunus said that Grameen Bank had lent nearly $6 billion over the last 30 years in loans that average $130 each. A key stipulation of the program is that its loans must be for income-producing activities, not consumption. But, perhaps more important, Grameen’s borrowers also must commit to the program’s “16 decisions,” which include family planning, educating their children, not accepting or giving dowries, and embracing “discipline, unity, courage and hard work” in all walks of life. (…)

The most important lesson from Grameen is that cultural values, even those long entrenched, can be successfully modified. Bangladesh is a Muslim country, where concepts such as charging interest or using contraception are considered “un-Islamic.” Yet, by using micro-loans as a cultural stimulus as well as an economic instrument, Yunus changes the attitudes of his fellow citizens at the grass-roots level. (…)

The operational details of Grameen are equally noteworthy. By requiring weekly payments, borrowers are constantly reminded of their obligations. The close relationship between borrowers and lenders means that they know exactly the consequences of non-repayments: other potential borrowers — often fellow villagers — will be deprived of their opportunities. Grameen’s emphasis on behavioral changes alone may indeed be more of a help in easing people out of poverty than the money itself. (…)

The Grameen Bank miracle is in using those micro-loans as a social stimulus to effect needed changes in personal behavior and cultural values. This key point is often missed by those enthusiastic in replicating the bank’s success. (International Herald Tribune)

 

See also: Microcredit

 

No prices: pay what you want

The Seattle Times has a story about a cafe at which

Customers pay what and when they like, or not at all — it makes no difference to the cafe employees, who are instructed not to peek when people put money in the metal lock box.”Does it really matter to any of our patrons … whether they pay a dollar or three dollars or five dollars?” said Terra Bite founder Ervin Peretz. (…)

Peretz admits that Terra Bite treads on shaky ground. He’s got to attract enough paying customers to cover the cost of those who pay less or not at all.

Peretz isn’t worried that people will abuse Terra Bite. There’s
enough money to fund the honor system, and enough honor, too, he said.

Quite a premise from which to launch a for-profit venture. Do you agree?

Microcredit

As founder of the Grameen Bank receives Nobel Peace Prize, the profile of microcredit lending grows

Bangladeshi Economist Claims Nobel Peace Prize [Real Player] http://www.npr.org/templates/story/story.php?storyId=6605060

Nobel Peace Prize Award Ceremony 2006 [Windows Media Player] http://nobelprize.org/award_ceremonies/ceremony_oslo/video/2006/index.html

Grameen [pdf, Windows Media Player
http://www.grameen-info.org/

The Microcredit Summit Campaign [pdf] http://www.microcreditsummit.org/

Kiva.org: Loans that change lives
http://kiva.org/

(thanks)

 

Duopolies

Coke and Pepsi, McDonald’s and Burger King, Boeing and Airbus—this is an economy full of duopolies. One of those pairs, UPS and FedEx, is proving to be a fascinating Rorschach test about the state of the economy.

UPS and FedEx both make excellent bellwethers for the stock market as well as the economy at large. They have their fingers on the pulse of trade and services. When the economy is humming, these firms process ever-larger quantities of parcels, envelopes, and boxes. FedEx and UPS are also heavily exposed to price changes in key inputs—particularly transportation and fuel. So, their results can tell us quite a lot about how rising costs affect corporate profits, and thus stock prices.

Same but different:

FedEx gets most of its revenues from express delivery and has a small retail copying unit (Kinko’s); UPS has a larger presence in the global freight market. (via)

When price is might

Pricing is fundamentally a measure of your confidence as a business owner and it’s the only validation of the value you provide to your market. If you can’t price your products high enough to run a legitimate business, you’ve either got to grow your confidence, change your products so you are providing that value, or get out of the business.  (via)