What's the Difference Between Invention and Innovation?

The history of technology is replete with stories of companies that had a great idea but didnt know quite what to do with it.

Xerox PARC, the celebrated Silicon Valley-based R&D center is the most famous of these. Its staff and the creative genius they unleashed are legendary in the tech community, both for the brilliance of their inventions - and for the fact that others often benefited far more than did the parent company that paid for it.

There have been other fonts of innovation over the last century including RCA and Bell Labs. But the increasing prominence of Apple's SIRI has drawn attention to a once secretive company whose primary function is to win government contracts in order to help the US military realize its technological dreams.

SRI International, the company that spawned the idea that became SIRI has a distinguished provenance. SRI originally stood for Stanford Research Institute and was the university's research arm. It was eventually spun off in order to provide greater opportunity to become profitable and it has achieved that goal.

SIRI is emblematic of the company's focus on innovation rather than 'mere' invention. The notion is not so much to be the cleverest (though that doesnt hurt)or to come up with cool new stuff, but to be sure that whatever is being created is intended for a market that enables both SRI and its clients to secure a financial return while solving a problem that may enhance other commercial opportunities.

This focus on practical applicability has assured a steady stream of new business while financing ever more audacious experiments that lead to even newer and potentially profitable new fields. It is quite an innovative business model. JL

Dan Friedell reports in Fast Company:

SRI International, the brains behind Apple's Siri, has launched a dozen consumer products since its digital assistant got famous. We venture inside SRI's labs to find out why you haven't you heard of any of them.

Could Technology Kill the Asian Growth Miracle?

What goes around comes around.

China and many other locales in Asia have grown dramatically over the past three decades by providing the manufacturing platform for the western technology boom. Economies have grown, incomes have increased and the global commercial playing field has leveled more than a bit.

But as so often happens, the forces that unleashed this wondrous growth spasm could also be its undoing.

The Chinese are running out of people. As hard as that may be to believe, the increase in incomes across their economy decreases the incentives to move to the huge factories in coastal cities where much of the manufacturing takes place. Reports have already surfaced that Foxconn, chief supplier to Apple, Samsung and other tech companies, has been unable to hire enough workers so has pressed Chinese students to work in its factories involuntarily in order to meet demand for the debut of the latest iPhone.

What this means is that the Asian labor cost advantage is disappearing. Among the solutions is the replacement of workers with robots. Foxconn has stated it plans to install 1 million of them over the next few years.

In addition, as the following article points out, there is a cultural impediment to the sort of innovation that sparked the Silicon Valley/Route 128 revolution of the past few decades. Incremental change is valued more highly than radical change of the sort that sparked the internet era. Though China leads the world in patent applications, many of those are not globally protected, meaning that they are derivative or less impactful than those coming out of western countries. The solution of strong-arming western companies into surrendering intellectual property rights in return for access to the Chinese market is causing disquiet. In the meantime, businesses in the west have used this period to figure out how to prevail using technology to offset their labor cost disadvantage.

Ironically then, the very technological revolution that drove Asian growth may now be sapping its future prospects. JL

Izabella Kaminska comments in FT.com/Alphaville :

We’ve noted on more than one occasion that economists may be missing a trick when it comes to how technology is changing the global economy. More so, that developments like 3D printing, could even pose a black-swan risk for Asia in their own right.

Age and Insight: The Eureka Moments Are Happening Later

It is curious that in the age of connectivity, 24-7 hyperactivity and, well, the omnipresence of raw speed in all human endeavors that the age at which we invent things is getting older and slower.

Is it because we have so much more information to process? That we have gummed up the innovation works with all sorts of superfluous check-points, from dissertation defense to publication vetting to research oversight and scientific experimentation review? Or has the rush caused us to slow down our thought processes in order make sense of it all?

Whatever the combination of answers may be, the evidence of the slowdown is manifest. As the following article asserts, the average age for Nobel Prize winners in various scientific categories has risen by an average of six years. And more in certain disciplines.

There are those who think we should be worried. That this suggests a drag on innovation and economic growth. But others think it may be that technology has obviated the need for some aspects of scientific research by shortening the research cycle and focusing more on commercial outcomes than academic rigor.

It may simply be that cognitive capacity is achieved earlier in new fields than in more established ones. Or it may be that we are acknowledging how much less we know than we thought we did. JL

David Wessel comments in the Wall Street Journal:

Conventional wisdom is that big scientific discoveries are made by the supple minds of the young. Albert Einstein famously said, "A person who has not made his great contribution to science before the age of 30 will never do so."

How Google Builds Its Maps - and What That Means for the Future of Everything

Why would you bother?

That is the question that arises when one realizes the effort, the sheer scale of the enterprise required to create, update and improve Google Maps.

And no, the answer is not that they think maps are cool. Or that the company is public-spirited and just want to help people. Though both may be true.

The answer, to the extent that it can be sussed out, is that Google is locked in a Death Match with the world's largest, most iconic brand. Apple. To survive, let alone prevail, it needs to optimize the variables that allow it to compete effectively in the race to global tech dominance.

For Apple, those assets include design, hardware manufacture and the execution of strategy that arcs from conceptualization to delivery of products that dont just work well, but invent and then set the standard for entire classes of technology. And to those who think that is not so special, the graveyard of entrepreneurship and innovation is overflowing with companies who managed to do one, but not the other.

What Google does really well is identify, collect and manage information. Lots and lots of information. Organizing and applying that information in ways that consumer/citizens can use it to their advantage is their strength. The advent of mobility as a Truth of modern living has helped their cause because it means that knowing where one is, where one wants to go and what one may find along the way is not just useful, but a source of revenue and competitive advantage.

Arch-rival Apple has sensed the same tremor, which is why it is morphing iTunes into networks. Control may be an outmoded concept, but maximizing one's leverage is still an imperative.

So, when you casually start figuring out where your friends are or where they might want to be, based on what you tell them, remember the vast quantities of intelligence and strategic direction encapsulated in those thumb-strokes. In the misty future you - or your offspring - may even be driving cars or traveling on other modes powered by that knowledge. Assuming Google plays it right, it's going to be a long, happy journey. JL

Alexis Madrigal reports in The Atlantic:

The company opened up at a key moment in its evolution. The company began as an online search company that made money almost exclusively from selling ads based on what you were querying for.

But then the mobile world exploded. Where you're searching has become almost important as what you're searching. Google responded by creating an operating system, brand, and ecosystem in Android that has become the only significant rival to Apple's iOS.

Buying Access to Innovation: Corporations Invest in Start-Ups

Make versus buy.

That is one of the classic questions posed to first year MBA students. The notion is whether it is more cost-efficient and effective to invent and create something or to simply buy it from someone else, presumably a smaller, nimbler and more focused entrepreneurial business. But the analysis is not simple, because it entails assessment of myriad inputs and outcomes that contribute to value - many of them intangible and reputational: employee motivation, inculcating a culture of innovation, strategic choices, competitive implications.

Recently the trend has been to buy. Investors want returns now. Bonuses, stock options and job security depend on short-term performance. Companies claim that they dont 'get paid' for sponsoring research with a medium to long range outlook.

So they become 'strategic investors.' Which is investment-banker speak for someone who will overpay because it is easier to do that than to actually go to the trouble of thinking up and producing the product or service themselves.

We have seen the results most clearly in the pharmaceutical industry where the cost and marketing effort are so gargantuan it is believed that only new drugs with billion dollar or euro sales potential - or higher - are worth the effort. So the big pharma companies invest in little bio-tech start-ups (or their somewhat more developed older siblings)in order to grab some of that performance on what they consider to be the cheap.

So now its tech's turn. And the timing couldnt be better! Facebook killed the IPO market. VC investors are in the fetal position. So who decides it's the perfect moment to catch some of that ol' Silicon Valley magic? Why it's corporate America. They are sitting on piles of cash, too worried about the future to risk their executives' compensation on the uncertain outcome associated with actually investing in something productive themselves. So they are opening offices in the Bay Area, taking lunches and breakfasts and generally letting it be known that they have cash to burn for the right idea.

How will this turn out? History suggests this is a transitional movement. The global corporations can not buy enough innovation to really gain strategic advantage. But it does give them something to do until their belief in the future returns. JL

Evelyn Rusli reports in DealBook:

New York, London and Hong Kong are common addresses for blue-chip multinationals. Now Silicon Valley is, too.

From downtown San Francisco to Palo Alto, companies like American Express and Ford are opening offices and investing millions of dollars in local start-ups

Color War: Christian Louboutin Wins Appeal to Trademark Red Soled Shoes

Whew! Just in time for fashion week.

The eyes of the intellectual property community have been focused myopically on the seemingly endless Google-Samsung-Apple patent battles. Because that's where the big legal fees are, we hear you cynically intone.

But an equally interesting fight has been waged in the US Federal courts for the past year between two French design houses, Christian Louboutin and YSL (Yves St. Laurent). Louboutin claimed that he 'owned' the use of the color red on the soles of women's shoes. YSL disagreed.

To many mere mortals, the notion that anyone can own the use of a color seems a bit extreme. What's next, suing everyone with a green lawn who didnt pay for permission? But the court, in its wisdom, ruled that Louboutin has the right to use that color on shoe soles provided, Solomonically, that the uppers are a color other than red. Sounds a bit, well, persnickety to you?

Philistine! YSL won the right to use red soles as long as the uppers are red because it pioneered that particular 'look and feel.'

Which leads us to the larger point: that companies like Louboutin - and Apple - are fighting for greater restrictions on the use of intellectual property - patents, copyrights and trademarks - that fairly belong in the public domain. The whole point of intellectual property law is to protect the work of creative people and entrepreneurs who deserve the right to benefit from the work they have done in designing and building innovative products and services.

There are many who fear, however, that the increasingly restrictive applications of this concept will reduce the incentive to innovate while driving up prices.

We may well celebrate M. Louboutin's design sensibility and taste. But it is unlikely that many of us can afford his shoes. And the concern is that a growing string of such decisions may put large portions of the human spirit off limits. JL

Basil Katz reports in Reuters:

The bright red soles on French footwear designer Christian Louboutin's high-heeled shoes are so distinctive they deserve trademark protection, a U.S. appeals court has ruled.

So Who Inherits Your iTunes and eBook Libraries?

Here's the good news: one less thing for the relatives to fight over after you're gone.

Because the answer appears to be that you cannot bequeath your iTunes list to anyone. Per se. You can, of course, give your iPod or iPhone or laptop to someone and, assuming you pass along all the relevant passwords they can copy your list. But actually determining what rights, if any, you may have for any of your accumulated electronic wealth is a legal gray area shrouded in black.

The issue comes down to rights. Which, if you bother to read the boiler plate legalese Apple and others make you agree to with a dot occasionally before downloading, you do not have. Or own. In fact, the rights are 'nontransferable.' And you agreed. Same with eBooks.

Many states have passed laws granting access to digital accounts, a crucial right given the degree to which the computer has replaced the file cabinet as the source of knowledge and wealth. But the same rights do not usually extend to electronic files you may have purchased.

Enjoy them while you have them. And remember that it's not really going to be your problem anyway. JL

Quentin Fottrell reports in MarketWatch:

Many of us will accumulate vast libraries of digital books and music over the course of our lifetimes. But when we die, our collections of words and music may expire with us.

Is the Download the Mother Lode? Why the Online Music Industry is Such a Mess

The online music industry is another economic entity that looks to too many people like China: huge market, there's got to be a massive amount of coinage in there, I'm gonna get me a piece of that action.

Following the old line about entrepreneurs thinking they will make up their profit shortfall on volume, record companies, techies, performers and agents all think that by driving a hard bargain, demanding what's theirs, refusing to compromise they will somehow strike some hidden seam of gold that will ensure their future prosperity.

The problem is that it is also a lot like the financial industry: a lot of smart people having the same idea does not make a bigger market for all. As the following article points out, Spotify, Pandora, JayZ, Taylor Swift and all the others who think that the Download is the Mother Lode are cancelling each other out. iTunes grabbed first mover advantage, but between illegal siphoning off of music and profits, the fair but restrictive copyright laws and the drive by everyone involved to cut their own deals, there is not a lot left over for anyone.

The industry needs a collaborative model. But it appears that a lot more people are going to have to lose a lot more money trying it on their own before a successful system emerges. JL

Don Sears reports in CNN/Fortune:

If disruption means losing money, then online music services know how to spend like rock stars.

Man Bites Dog: Chinese Businesses Filing IP Lawsuits

Well, what do you know?

A company starts creating intellectual property and before you know it, someone starts ripping it off, so they decide to protect it. What a concept.

The Chinese, recently (in)famous for most gratuitously disregarding other people's patents, trademarks and copyrights, have found religion when it comes to intellectual property. And as so many conversions on the proverbial road to Damascus (or Dalian) are wont to have done, this one was inspired by self-interest. Namely, that as the Chinese increasingly believe they can compete on the global stage, they understand that protecting whatever value they are creating is essential to realizing future returns.

The world's largest country has long intended to evolve from a 'brawn' nation to a 'brain' nation. It was the messy details of how they were going to get there that remained unclear. But as Apple, Google, IBM, Facebook and a host of other tech companies - many co-founded by Chinese ex-patriots - have demonstrated, intangible ideas may matter more than tangible manufacturing plants.

And Chinese companies understood all too well the urgency of that protection regimen, because the most fearsome violators of their IP were their own countrymen. Having grown up fast in a tough neighborhood, Chinese companies are now working the system to protect the value they are creating. To do so, they are being pro-active in two ways; defending what they have actually created, and artfully using the IP laws to challenge others' IP rights in China and elsewhere to try to gain competitive advantage. Or, at the very least, a settlement that gives them access to something that might be useful.

No foreign business hoping to enter the Chinese market can expect to do so without trading some of their knowledge for the privilege of access. But the larger lesson is that as in so many other corners of the economic sphere, the Chinese have learned how to extract value by learning from the example of others. JL

Jia Lynn Yang reports in the Washington Post:

U.S. companies have long accused the Chinese of stealing their intellectual property. But now some in China are pointing the finger back.

Is Samsung's Pain Nokia's (and Microsoft's) Gain?

Wishful thinking?

The popular image of the Nokia Microsoft alliance has been something akin to two prisoners chained together. Or the last two kids at the dance without partners. They need each other given the preeminence of mobile in the tech firmament, but neither was considered a particularly strong partner.

Nokia once defined the mobile revolution but rested on its laurels and did not keep up with the evolution from mobile telephony to mobile computing. Microsoft? Well, they are still an industry behemoth, but their forays into a variety of new markets have not been particularly meaningful, let alone game-changing.

Following the initial burst of Rocky-like dancing up the steps for Apple, more and more analysts are beginning to consider the negative implications of the Apple intellectual property victory: more money for Apple, higher costs and fewer options for everyone else. Especially if Apple wins the appeal of the ruling that Samsung has now filed. Which seems likely.

So many people are rooting for insurgents. It is possible that in Asia, Samsung will begin to win some local legal victories by government dominated courts that justly fear the strategic implications of Apple dominance. Japan and China may already be signalling that sort of movement. But this has created openings for new designs and and new products that evade the Apple patents and provide comparable services at a more realistic price.

There is also some evidence that Apple gets the need to play nicely with others. Reports suggest that Apple and Google have begun discussions to work out their differences and attempt to find mutually agreeable solutions. Only lawyers benefit from the alternative. JL

Adam Ewing, Adam Satariano and Hugo Miller report in Bloomberg BusinessWeek:

Nokia Oyj (NOK1V) and Microsoft Corp. (MSFT), both looking to increase U.S. sales of smartphones, stand to get a much-needed boost as Samsung Electronics Co. (005930) products face a possible ban and handset makers come under pressure to consider alternatives to Google Inc. (GOOG)’s Android software.

The Untouchable Economy: Why Are Gen Y - and American Business - Turning Against Stuff?

Once upon a time, like about four years ago, real men and women didnt deign to think about intangibles.

They were considered 'soft.' And Serious People only thought about what was 'hard.' Things you could count. That you could find on a balance sheet or income statement. Especially if they had been audited by a reputable firm. Because, it was believed, Serious People making Serious Money couldnt afford to spare the time to worry about mere concepts.

But yeah, that was before hard assets like real estate lost 70% of their value. And before it was learned that banks, those avatars of Seriousness, had leveraged their hard asset balance sheets up to 40 times their value. Which turned out not to be quite so hard once all their creditors started making not-so-polite inquiries about who owed what to whom - and who was actually good for it.

So we can forgive the Gen Yers - and most business people - for beginning to realize that in this economy, value and impact are where you find them. Not where some accountant whose fee depends on corporate largesse says it is. Sensibly, they are beginning to assess the value in entrepreneurial enterprise over a traditional job with benefits (assuming one can be found).

And the trend extends to other facets of the economy like housing and automobiles. Rent rather than buy. Lease rather than own. Because if businesses are sitting on the economic sidelines with billions they are unwilling to invest, why should mere mortals do any different?

The reality is that risk has never been higher, at least in the lifetimes of most people now living. But neither has opportunity been more manifest. Societal disapproval has been swept away by the tidal wave of failure associated with the financialized economy. You can try anything. And companies with silly names like Yelp or Zynga or Google can make people rich.

So give it a go, all you Softies. The hard dudes got nothing on you. JL

Michael Mandel reports in The Atlantic:

Young people are thinking entrepreneurially, viewing themselves as microbusinesses operating in a highly uncertain economic environment

Millennials are shifting from tangibles (cars and homes) to intangibles (education and access to data), but they are not alone. In today's data-driven economy, the business sector is moving along the same tangible-to-intangible path as the Millennials, perhaps at an even faster pace

The Impact of Technology on Advertising? Look at Financial Markets

Data.

One word is all we need. Sort of like that scene in 'The Graduate' when the recent graduate's uncle tells him, "I have one word for you young man."

Only this time that word is not 'plastics.'

A lot of people went into advertising and public relations and marketing and a bunch of other communications-related fields because they hated high school math. And managed to avoid it in college. So when they got out they looked for a job that involved personality. Writing skills. Public speaking ability.

And that was not a bad call. Then.

And the thing is, finance used to be the same way. Providing your clients with 7% annual returns had pretty much been the norm for almost a century (except for that nasty patch in the 1930s). Commissions were fixed by law. Investments were sold over lunch. And golf. Or on the tennis court. Or even at poolside. No heavy lifting. Numbers? There were guys in a back office somewhere who could provide numbers if you were going to be anal retentive about it.

Until the end of the US's golden post-WWII reign ended in the late 1970s. And business became globally competitive. Suddenly, you really had to know stuff. Numbers were everywhere. And people really had to know what they meant, because that could be the difference between contentment and unbe-freaking-lievable wealth.

Technology just turbo-charged the process. By making the identification, manipulation, reorganization and investment of data more effective and efficient. It has also created new markets for new products and new services. And it has tied the whole together in a truly global web.

It hasnt stopped and it never will. Managers and clients will always want to know more because it will give them more power to sell more ideas and products and services to more people in more places. And no matter what business you are in, that is very much the point. JL

Andrew Nibley comments in Advertising Age:

If you want to see the future of the ad-tech industry, look to the history of the financial- services industry.

Quantifying You: The Business Proposition

Analyze this, indeed.

CEOs have been paying lip service to the value of their employees for a couple of decades now. That is, ever since it became fashionable during the run-up to the dotcom bubble. Lots of variable costs like people were assigned value in those heady days. With the valuations going the way they were, who cared about impacts the size of minor rounding errors?

But no one took the rhetoric too seriously, especially the executives themselves. It was a throw-away line that curried some favor with the troops but no one really expected the bosses to be held to it. And as the cataclysmic lay-offs of the post-financial era have demonstrated, they werent.

It would be easy to point all the fingers at the nasty guys and gals in the corner offices - and they deserve plenty of blame for heedlessly destroying value - but there was another issue: no one had successfully quantified the intangible inputs and outcomes statistically linked to the notion that people contribute to organizations in ways that can be identified, measured and managed.

Yes, that was a problem. We could talk around and about it. We could allege and declaim and assert and even correlate. But establishing causality was not often achieved. And many doubted it was achievable.

Which is why the latest developments in personnel management are such a welcome relief. Because all those ephemeral attributes that we know, can see and can feel make a difference between a highly functioning organization and a less successful one can no be isolated and connected to outcomes that matter. To the managers, investors and colleagues of those in question.

So the C-suite dudes no longer have an excuse when they are asked to assess the value of their staff - and what the impacts of layoffs - or, perish the thought, hiring might be. And neither do the rest of us. JL

Ciara Byrne reports in Venture Beat:

Talent Analytics measures people, weighing their preferences and motivations and how those characteristics predict job performance. ”Our niche is companies who have employees,” jokes founder Greta Roberts.

The company surveys employees and summarizes them in 12 numbers that cover work style (“What kind of tasks do you prefer? Are you detailed-oriented? Collaborative?) and motivators like creativity, bottom-line, or a sense of mission.

Jury Finds for Apple vs Samsung in Mobile Patent Lawsuit; The Implications

It isnt the $1 billion awarded in damages.

Yeah, that's a lot of scratch, but not really for either Apple or Samsung. It may put a dent in someone's bonus if Samsung ever actually has to fork it over, but even that is not certain.

And it isnt necessarily that Apple won. That is significant in that it forces everyone else to stop copying now. It will probably impact the market - for a while.

But the big news may be in two disparate albeit connected areas: design and innovation.

There is no doubt that the jury verdict is good for Apple. They protect their franchise and it gives them some breathing room to continue building on their financial lead in the post-Steve Jobs era.

That the nexus of the decision is focused on design is very significant. The look and feel of the iPhone (Samsung actually saw its tablet design protected in this case)is one of its salient features. The key patents have to do with how it appears and operates. This means that design - and the patents that protect it - are now operationally and financially important. Perhaps in some cases even dominant features in the business environment. Take that, all you deriders of so-called 'soft' assets.

What's also clear is that it may not be so good for the rest of humanity in the short term. One argument says that innovation may be stifled as companies start flinging patent suits at any competitor who looks sidewise at their products. Patent trolls, financial carpetbaggers whose business is to buy patents and then sue anyone who produces anything vaguely similar in hopes of cashing in on the resultant suit or settlement, will be emboldened. There may be a period of uncertainty as everyone attempts to ascertain how to proceed without an armada of legal battleships protecting them.

But there may be an element of 'be careful what you wish for' for Apple in this decision. Android phones from the Google-Samsung alliance have been outselling iPhones by over 3 to 1. The issue is availability and Apple's expensive pricing. The market is making it clear that the greatest future growth may be in lower end products with similar, if not identical, features. And the verdict's impetus to spur creativity in design rather than slavish devotion to the Apple template may produce some serious competition.

This is all speculative. Right now, Apple rules the roost. But the co-evolutionary nature of technological development suggests that this was one battle in a very long war whose end is not yet in sight. JL

Joel Rosenberg and Ian King report in Bloomberg:

Apple Inc. scored a clear victory in its patent dispute with Samsung Electronics Co. yesterday, increasing pressure on smartphone makers around the world to create handsets that stand apart from the iPhone and deliver more choices for consumers in a $219.1 billion market.

A jury awarded $1.05 billion in damages yesterday after finding that Samsung infringed six patents for mobile devices, a defeat for Apple’s biggest opponent in smartphones.

Microsoft Gets First New Corporate Logo in 25 Years

You have to chuckle.

The symbolic importance of a logo is often more significant than the design itself. Companies frequently use the design to communicate how they are becoming younger, nimbler, more focused on the future than ever. Typeface, color, graphics and styling can convey momentum, vigor, stability, strength - or whatever other attribute marketing strategists believe is essential to renew commitment with established customers while enticing new ones to join the fold.

In the case of Microsoft, we have a once dynamic brand that personified competitive dominance. Which has lately been overshadowed by newer avatars of technological prowess. This would have seemed to have been a great opportunity to remind the world of its historic successes while drawing attention to the brilliance of its newer initiatives.

And, despite its proud history, smart people and notable successes, Microsoft has come in for its share of ribbing, mostly from arch-rival Apple. Their founders, Bill Gates and Steve Jobs, are likely to be remembered as the two most memorable and brilliant leaders of the computer/internet era. Their human personality traits, steady for Gates, versus mercurial for Jobs, seemed to capture, however fairly or not, the style of their businesses. And Apple took advantage of that in a series of wickedly pointed ads in which 'PC' came to personify the alleged stodginess of the Microsoft product and service.

So why, one must ask, did Microsoft, with billions in cash on hand and access to the best designers in the world, double down on that salubrious, disrespectful memory by embracing a new logo that, as its signature feature, is square and gray?

Calling Dr. Freud... JL

Tom Cheredar reports in Venture Beat:

Iconic technology giant Microsoft is rolling out a new corporate logo to go along with the company’s line of recently released or forthcoming major product updates — the first time its done so in 25 years.

Reframing the Jobs Crisis in the Post Knowledge Economy

Forget the new normal.

That instant cliche is already so 2011 it makes time spent waiting for the G5 phone seem like milliseconds.

No, what if the real problem with lagging employment and stagnant economic growth is that we have outlived the usefulness of the institutions that frame the way we organize, manage, collaborate and produce? Yeah, heavy.

And if that were true, what the hell could we do about it anyway? Well, that is one of the questions people who dare to think about such things are attempting to grapple with. The basic thesis is that technology has simply shown a light on the crumbling nature of the structures society has created to organize itself economically. And that the education, training, operational intelligence, organizational design and other factors that drive productivity and profit may be equally inadequate to meet the demands of the emergent global economy.

It is not that technology is to blame for the lack of jobs (Luddites, put down your sledge hammers)but that we mere mortals have failed to embrace the changes we need to make in order to bend all those devices to our will. Everyone sitting in a Starbucks in some edgy urban enclave feeling smug about their prospects while writing algorithms on their iPhone is as vulnerable as the least educated delivery truck driver.

The problem is that the economic imperative of large institutions says that managing to scale is the only way to create successful growth. But this 'push-based' organization, as Hagel calls it, is subversive. It is 'post-knowledge,' because, like post-industrial, knowledge is assumed, factored in, accounted for. You no longer collect 'excess rents' for having it or knowing about it. You Pass Go based on what you can do with it, big time.

Technology may be our friend, but not for everyone, everywhere, all the time. And changing institutions or the way they create value is hard because managers and investors got where they are, usually, by optimizing the returns from current structures, not by tackling the distraction and excess friction of creating new ones. But it may be that collectively, we are stumbling towards a new institutional approach, together, based on our connectivity - and our desperate need. It's shape(s) and impact(s) are not yet apparent. But the fact that we recognize the need but do not yet recognize the form may be their salient attribute. JL

John Hagel comments in his blog:

The recent book, Race Against The Machine, has caught the imagination of a growing body of readers. It’s an important book, but it doesn’t go far enough in highlighting the root causes of the unemployment we are experiencing. Rather than framing it as a technological issue, the book would have generated a lot more insight about both the problem and the solution if it had framed it as an institutional issue.

The Mobile Wallet Frenzy: Why Major Retailers Are Creating Their Own Electronic Payment Systems

Talk about a bandwagon.

The mobile wallet is suddenly every retailer's new dream. McDonald's just announced it is testing one in France. Starbucks established its alliance with Square a couple of weeks before that. Walmart, Target, 7-Eleven and Sunoco, among others announced they are collaborating to create one for their customers. The banks, phone companies and, most famously, Google, are also in the mix.

The impetus is that companies want to build loyalty with their customers, which they believe will lead to greater sales and profits since repeat customers are less expensive than new customers. They also want to capture customer purchase data without having to pay a third-party vendor for it so as to better target ads and promotions. And, of course, they believe there is money to be made in the financing of customer purchases. All of which is pretty compelling. But with so many disparate cards in the mix, aren't consumers going to get annoyed trying to remember which system to use where?

The strategy is that all of these players want to establish a presence in the electronic payment marketplace. Once they have done that, they can then negotiate with each other to establish what will probably end up being one or two or three major alliances, just like for credit cards, airlines and so forth. Unless you have a presence, you have nothing with which to negotiate - and, as a merchant, you will become a supplicant forced to pay higher fees with less control over the ultimate direction of the enterprise.

The businesses claim customers are clamoring for this in a mobile-obsessed society. And there is some truth to that. But abuses will soon emerge, inevitably, as people overspend while merchants over-promise - and probably over-charge. Heightened regulation is sure to follow, though there will be some internal tussles over who gets primacy: financial, telephonic, consumer - or some combination of them all.

The only imponderable now is how big this market will become. JL

Robin Sidel reports in the Wall Street Journal:

More than a dozen big merchants announced their plans to jointly develop a mobile-payments network that will battle similar services from Google Inc.and other companies.

Wal-Mart Stores Inc., Target Corp.,7-Eleven Inc. and Sunoco Inc. are among the companies hoping to elbow their way into the burgeoning market that turns smartphones into devices for making purchases.

And the Point Is? Google- Motorola Patent Lawsuit Seeks US Import Ban of All Apple Devices

It's getting to be the end of summer and in many US states, the school year is beginning.

Which is entirely appropriate as the various patent battles under way resemble nothing so much as preschooler sand-box tussles.

The latest iteration is that Motorola, now owned by Google, filed paperwork for a suit that, if successful, would ban the import of all Apple devices into the US. And the likelihood of that happening is: approximately nil. In all fairness, there are those who argue it is exactly nil.

It is nice to see patents and other forms of intellectual capital receiving their due. It has been a long time coming. But from a strategic standpoint, this all appears to be a sideshow. The way to dominate the competition and establish an unassailable business is by designing and building great products, surrounded by superior services. Who-thought-of-what first in the maelstrom of technological innovation is, in most of these cases,(ahem)patently absurd.

One of the great advantages of Silicon Valley, Route 128, Bangalore, Tribeca, the Haidian district of Beijing and a host of other regional innovation hotbeds is the torrid exchange of ideas and people. Once the idea has gelled, the ability to execute and get your product to market is the differentiator.

The concern these patent battles raises is that corporations are focused more on protecting their turf than on creativity and innovation. As US Judge Richard Posner signaled in his opinion earlier this summer, these suits are a waste of the court's time - and the economy's time. None of these companies is going to put each other out of business on the strength of a patent lawsuit. But they may well put themselves out of business by losing focus on what really matters. JL

Matt Marshall reports in Venture Beat:

Motorola, the phone company Google acquired this year, filed a patent infringement suit against Apple that effectively to ban the import of the iPhone, the iPad and the iPad Touch to the U.S.

The paperwork was filed by Motorola with the International Trade Commission on Friday, but won’t be available for public viewing online until tomorrow (Monday).

Valuing Samsung: As Innovator or Copycat?

It's on.

Samsung's Android phones are outselling Apple's iPhone's. Dramatically. Some estimates give Samsung 64% of the mobile device market.

They are also going mano a mano in the courts. Many experts think Apple's claims are overblown and that this is just a sideshow to slow the Korean's momentum down. When you have as much cash on hand as Apple does, litigation expenses are barely even a rounding error.

But the larger issue, as the following, detailed analysis from the Financial Times explains, is that Apple enjoys a market valuation far in excess of Samsung's. Samsung partisans believe this is unjust and maybe even unfair. There is muttering about anti-Asian biases. But the harsh reality is that in a market dominated increasingly by intangibles like design, reputation and first mover advantage, Apple's valuation seems justified.

Samsung, meanwhile, is a fast follower and may well enjoy the spoils that accrue to those embracing that strategy. But there is also a price to be paid in lost prestige and that, too, appears logical. JL

Jennifer Hughes and Stuart Kirk report in the Financial Times:

Reading this on the move? If so, the chances are you are using an Apple or a Samsung Electronics device. By the time you have finished (we give you 10 minutes), the two companies will have sold almost 5,000 smartphones. Everyone knows about Apple. The iPhone has been flying off the shelves since 2007. But it is currently being outsold by Samsung. Of every five smartphones sold by the two companies, three will be a Samsung.

The Amazon-eBay Showdown is Coming

Mobile. Who knew?

Amazon has been grabbing all the attention of late. New products. It's own phone. Contributions to gay rights. Rocket ships. Whatever. Everything it touches turns into a press release. That gets play.

eBay? That company that had a strong run during the dotcom bust. A site where people sell weird cast-offs and industrial strength inventories of stuff no mere mortal is ever seen using. Or so it seemed.

Turns out that mobile gives eBay a nice strategic advantage in a couple of ways. First off, since it doesnt rely on advertising, mobile apps designed specifically for eBay users goose its margins. As if that werent enough, eBay's ownership of PayPal, the original mobile commerce wallet, guarantees it gets a slice of everyone else's ecommerce lucre - and an even bigger piece of its own.

So just as Amazon seems to be moving into a host of related businesses, eBay, now recovered from what was widely perceived as a near-death experience or at least terminal irrelevance, is now growing exponentially. And it is chasing that same consumer Amazon thought it owned. This universe may be big enough for two ecommerce behemoths. Or not. JL

Don Reisinger reports in CNN/Money:

eBay's spectacular turnaround has been fueled by mobile commerce. That puts it on a collision course with Amazon.