Getting sued, laying off most of your workforce, losing your third chief executive and then being bought out doesn't sound like the history of a successful company that could teach Internet businesses a key lesson. But Napster's problems make it one of the best examples of the value of "network effects" and how you can make your users build your service for you. \nThe Internet and the open source movement have made huge changes to businesses in recent years, but the jury is still out on how those changes add up to a new way of doing business. Speaking at BEA's recent eWorld conference, Tim O'Reilly, chief executive of computer book publisher O'Reilly & Associates, suggested that the licensing question that exercises many open source advocates -- and the companies that see open source as a way of saving money by switching away from Microsoft -- is actually irrelevant. \nThe most popular Linux applications aren't databases or office tools, he points out: They're services such as Google, Amazon and PayPal, which run on servers running open source tools such as Linux, FreeBSD, Apache, MySQL, PHP and Perl. Just saving money on software licenses is not what makes them successful. Also, they don't need to let anyone see the source code because they don't distribute them. \n"These are all fiercely proprietary companies, so something is wrong with the idea that once we have open source software, there will be no intellectual property," says O'Reilly. "We have people like Jim Allchin [of Microsoft] saying that open source is an intellectual property destroyer. It's just not true. Here you have these companies with huge amounts of intellectual property but it's sitting somewhere else in the business." \nWhen tools and services get more valuable as more people use them, that's known as the network effect. Telephones, fax machines and email are the most obvious examples, but network effects drive many successful businesses. New users pick Microsoft Office because it is what most employers want you to know, and the more people who use the Office file formats, the easier it is to share documents. Thus, network effects don't just bring you new customers, they make what you sell more valuable to old and new customers alike. \nO'Reilly thinks that is the key for open source and internet businesses. \n"What really matters is the architecture of systems: open source is ultimately about systems that create and manage and magnify network effects," he said. \nThat means if you design the system right, you won't need to do the hard work yourself: your users and partners will do it for you. \nNot because you are paying them (like Yahoo's editors) or out of the goodness of their hearts (like the volunteers who compile the Open Directory or the Wikipedia), but as a side effect of what they're doing for their own self-interested reasons. \nNapster and other file-swapping services didn't spend time building a complex network for their users: they gave users the tools and the incentive to do it. They are not the only services to take advantage of their users. EBay's customers don't just provide the products and content on the auction site, they police each other by giving feedback. Google's search tools help users find information on the web, but the PageRank algorithm exploits the millions of links that individual web developers create to pages they think are interesting. \nAmazon uses customers' searching and spending habits to suggest relevant products: When you search, you don't get the newest or cheapest books unless you specifically ask for them, you get the ones that are most popular in terms of reviews and sales. Look for information on Microsoft's support site and, as well as official resources, you will find links to relevant discussions in public newsgroups, so you can see if someone has already found a solution. \nThese are ideas any company can use on its site or in a service, so you need to make sure you own the user-generated data and metadata that give your service the network effect.
Softbank Group Corp plans to keep a stake in the chip designer Arm Ltd, even if it sells a partial interest to Nvidia Corp, the Nikkei reported. The companies are negotiating terms, the newspaper reported, citing sources. Softbank might take a stake in Nvidia after it buys Arm, the report said. Nvidia and Arm might also merge through a share swap, and Softbank would become a major shareholder in the combined company, it said. The two parties aim to reach a deal in the next few weeks, the sources said, asking not to be identified because the information is private. Nvidia is the
END TO SPECULATION: The hotel’s management contract has been extended, despite reports that it wanted to end its alliance with Hyatt Hotels over a deal with Riant Capital Singapore-based Hong Leong Hotel Development Ltd (豐隆大飯店股份) yesterday said it has extended a management contract to ensure the continued presence of the Grand Hyatt brand in Taipei, ending rumors that the two sides were parting ways. “We are pleased Hyatt is able to come to terms on the extension of the management contract of Grand Hyatt Taipei,” said Kwek Leng Beng (郭令明), executive chairman of City Developments Ltd (城市發展) and Millennium & Copthorne Hotels Ltd (千禧國敦酒店). Hong Leong Hotel Development is a subsidiary of Millennium, and both fall under the Hong Leong Group (豐隆集團). The Grand Hyatt Taipei (台北君悅大飯店), owned and built by
Gold surged to a fresh record on Friday, fueled by US dollar weakness and low interest rates, while silver headed for its best month since 1979. Spot bullion is up more than 10 percent this month, as US real yields lingered near record lows. While the ferocity of rallies in gold and silver cooled in the middle of the week, most market watchers predict there might be more gains ahead. Both metals have added about 30 percent this year, with gold and silver exchange-traded funds boosting holdings to a record, as concern about the fallout from the COVID-19 pandemic fuels demand for
MOVING FROM CHINA? The article did not name the company, but Foxconn, Wistron and Pegatron were among firms chosen for a production-linked incentive plan in India An Apple Inc vendor is looking at shifting six production lines to India from China, which could result in US$5 billion of iPhone exports from the South Asian nation, the Times of India reported, citing people familiar with the matter who it did not identify. The establishment of the facility would create about 55,000 jobs over about a year, the newspaper reported, not naming the Apple vendor. It would also cater to the domestic market and expand operations to include tablets and laptops, the newspaper reported. Samsung Electronics Co and Apple’s assembly partners are among 22 companies that have pledged 110 billion