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Metanomalies

Posted by Guan Yang on March 18, 2011 . Leave a response

I asked Sean, my resident expert on all things text, to comment on Anne Hathaway driving Berkshire Hathaway’s stock:

If only we knew exactly what these guys were doing. We’re pretty sure they’re using things like naive bayes classifiers to both 1) classify articles as being relevant to a particular stock and 2) predict return events from the text of news, and this is exactly the kind false positive you’d expect to see in both cases. If there isn’t already, there’s going to be a big set of papers on meta-anomalies, anomalies created from automated trading systems trying to take advantage of extant anomalies.

Meta-anomalies. I like that.

Update: Sean adds more detail.

Loading Mint asynchronously

Posted by Guan Yang on March 18, 2011 . Leave a response

I use Shaun Inman’s excellent Mint for analytics on this blog. The default instructions are to link to Mint’s JavaScript using a script element inside the head element. Unfortunately this means that page loading will block while Mint loads, which can add several hundred milliseconds to load time.

Fortunately Google provides some code to load Google Analytics asynchronously and this code can be easily adapted to Mint. Just put this at the bottom of your page and remove the script element for Mint from the top:

<script type="text/javascript">
(function () {
    var ma = document.createElement('script');
    ma.type = 'text/javascript';
    ma.src = '/mint/?js';
    ma.async = true;
    var s = document.getElementsByTagName('script')[0];
    s.parentNode.insertBefore(ma, s);
})();
</script>

CDN with TCP anycast lite

Posted by Guan Yang on March 17, 2011 . 1 Response

This is an idea for how to construct a better CDN. I don’t know if anyone has thought of this before. It’s a boring technical discussion, so it goes under the fold.

(more…)

The IPv4 money

Posted by Guan Yang on March 17, 2011 . Leave a response

Maria Farrell writes about Depository Inc., a company that wants to create a market for IP addresses. Far be it from me to oppose using markets to allocate scarce resources, but I am very, very afraid of this development. Although IP addresses are scarce, they don’t have to be, especially if we adopt IPv4. If Depository and others succeed in their efforts, they will have a huge incentive to keep IP addresses scarce, and a lot of money to lobby against the adoption of IPv6 and to oppose it in other ways. I would much rather see some market failure and imperfect technical solutions, such as carrier grade NAT, because that would provide an incentive to adopt IPv6.

Which NYT blogs will be outside the paywall?

Posted by Guan Yang on March 17, 2011 . 1 Response

As previously rumored, the many New York Times blogs will also be behind the paywall:

Visitors can enjoy 20 free articles (including blog posts, slide shows, video and other multimedia features) each calendar month on NYTimes.com

Blog front pages will still be accessible, but anything under the fold is paywalled. There are two exceptions, DealBook:

To honor our commitment to our loyal DealBook readers, all our articles will continue to be accessible without a digital subscription.

And The Learning Network:

To honor The Times’s longstanding commitment to educators and students, this blog and all its posts, as well as all Times articles linked from them and from our Twitter and Facebook accounts, will be accessible without a digital subscription.

None of the other blogs have a notice like these. (I actually had to click through every one of them to check. Some of them haven’t been updated in ages.)

Some notable non-exceptions are the two local blogs, Fort Greene and Clinton Hill, which is a partnership with the CUNY Graduate School of Journalism, and East Village, with NYU’s Carter Journalism Institute.

I am also surprised that the op-ed columnist blogs (Ross Douthat, Nicholas Kristof and Paul Krugman) are not excluded. Will they disappear from the conversation?

Reactions to the New York Times paywall

Posted by Guan Yang on March 17, 2011 . Leave a response

Cory Doctorow:

This won’t work.

Erick Schonfeld:

That’s all fairly reasonable and forward-thinking.

But there is one part of the pricing plan that is wrong-headed. It discriminates by device. Depending on what device you read the paper on, you will be charged differently for an all-digital subscription. The pricing plans start at $15 a month for Web access plus iPhone, Android, or other smartphone apps. On the iPad or other tablets, it will cost $20 a month. And if you want to switch between the Web, phone, and tablet, that will cost you $35 a month.

Felix Salmon, after estimating how much revenue the paywall will bring in:

That’s extra revenues of $24 million per year.

$24 million is a minuscule amount for the New York Times company as a whole; it’s dwarfed not only by total revenues but even by those total digital advertising revenues of more than $300 million a year. This is what counts as a major strategic move within the NYT?

…

So by my back-of-the-envelope math, the paywall won’t even cover its own development costs for a good two years, and beyond that will never generate enough money to really make a difference to NYTCo revenues. Maybe that might change if the NYT breaks its promise to offer full website access for free to all print subscribers. But that decision would be fraught in all manner of other ways.

For the time being, though, I just can’t see how this move makes any kind of financial sense for the NYT. The upside is limited; the downside is that it ceases to be the paper of record for the world. Who would take that bet?

Update: Kevin Drum:

It’s true, as Felix says, that a rough calculation suggests that the paywall won’t initially generate a ton of revenue for the Times. Still, I really don’t see a business model going forward in which companies like the Times continue to lose print subscribers as they give away their product online. One way or another, news readers have to get used to paying for content that they use heavily, and they might as well start getting used to it now. After all, if the Times, which is easily the best general purpose news outlet in the country, can’t convince people to pay for their stuff, then who can?

But what is the point of making news readers pay if that doesn’t actually make you money? Pride? Most print subscribers pay less than it costs to print and distribute the newspaper, but there are sound business reasons for making them pay anyway. Those reasons may also apply to some websites, but I’m not sure the Times qualifies.

Update 2: Tyler Cowen:

Don’t ask me to explain all the details of the pay wall system (can’t people set up rotating faux blogs and tweets, rich with daily NYT links, to get around the limits?), but I know there will be an articles quota, twenty per month. So the new NYT incentive is to have more than twenty must-read articles each month. Maybe they’re hire Bill Simmons. … The NYT arguably will be running fewer cliched or predictable or easily substitutable articles. It should make the paper less comprehensive, but sharper at the edges.

The incentive of NYT writers to keep blogs — so people can access their columns easily — will go up.

On that last point, the incentive for NYT writers will be to keep blogs outside nytimes.com because most of the official blogs will be behind the paywall.

The consumer’s dilemma license

Posted by Guan Yang on March 15, 2011 . Leave a response

The Social Science Research Council has a seemingly excellent 440-page report on Media Piracy in Emerging Economies. It has an interesting license for the electronic version:

  • US$8 for non-commercial use in high-income countries—a list that for the present purposes includes the USA, Western Europe, Japan, Australia, Israel, Singapore, and several of the Persian Gulf States (Kuwait, Qatar, the United Arab Emirates, Brunei, and Bahrain), but not Canada.
  • Free for non-commercial use outside the above-listed high-income countries.
  • US$2000 for commercial use, defined as use by businesses that realize financial gain from film, music, software, or publishing, and/or the enforcement of copyrights thereof, with annual revenues greater than US$1 million. Volume licensing is available.

(Emphasis added.) (Hat tip Randy Picker.)

They later clarified the license to define journalism as non-commercial activity and reserve a free copy for Chris Dodd.

You may interpret this license as a comment on copyright, piracy and intellectual “property”, but I see it as a dig at Canada and heartily approve.

I did pay the $8. I’ll report back when I have read the report.

Financial innovation counterfactuals

Posted by Guan Yang on March 15, 2011 . Leave a response

Josh Lerner and Peter Tufano have a new paper (I can’t find an ungated copy) on a research agenda on the welfare implications of financial innovation that involves considering counterfactual histories in which the innovations never occurred.

I’m not sure what to think of this as a research agenda, but there are some interesting case studies in the paper itself, which consists largely of narrative analysis. The inspiration comes from Robert Fogel:

Just two years later [1964], Robert W. Fogel, a future Nobel laureate in economics, published his masterpiece Railroads and American Economic Growth. In it, Fogel advanced a method, now used in history, political science and economic history, to consider counterfactual histories.

…

Fogel combines counterfactual reasoning with empirical estimates of development. He compares observed GDP increases with three counterfactuals: no railroads at all, an extension of internal navigation (canals), and the improvement of country roads.

They believe that the impact of venture capital on social welfare has generally been positive, citing statistics on innovation, product market strategies, startup outcomes, as well stock market outcomes:

In late 2008, 895 firms were publicly traded on U.S. markets after receiving their private financing from venture capitalists … By late 2008, venture-backed firms that had gone public made up over thirteen percent of the total number of public firms in existence in the at that time. And of the total market value of public firms ($28 trillion), venture-backed firms came in at $2.4 trillion—8.4 percent.

They also believe that mutual funds, index funds and ETFs were beneficial to investors, while evidence on the benefits of securitization, compared to plausible counterfactuals, seems to be much more mixed.

A list of blogs

Posted by Guan Yang on March 12, 2011 . Leave a response

Aaron Swartz asked for some blog recommendations. In no particular order, and without noting whether I agree with the blogger’s views or read for outrage or indifference, and omitting most of the usual suspects:

  1. Elder of Ziyon for the Zionist perspective. Mondoweiss for the anti-Zionist perspective. +972 and Bernard Avishai too.
  2. Howard French: Africa, China, photography.
  3. Accrued Interest, Credit Slips, DealBook, Delaware Corporate and Commercial Litigation Blog, Fama/French Forum, footnoted, Interfluidity, Aswath Damodaran, SCOTUSblog.
  4. ANIMAL, The Awl, EV Grieve.
  5. Arabic Literature (in English), Johnson, Language Log, LAWnLinguistics.
  6. Awful First Dates, China Daily Show, The Content Farm, Fucking Word of the Day.
  7. bezdomny ex patria, bokane, China Hearsay, China Law Blog, chinaSMACK, Imagethief, Evan Osnos, The Opposite End of China.
  8. Bleeding Heart Libertarians, Crooked Timber, Eunomia, Hendrik Hertzberg, Secular Right, The American Scene, The Reality-Based Community.
  9. British Politics and Policy at LSE, Lenin’s Tomb.
  10. Caissie’s Thing, Choire Sicha, Susan Orlean.
  11. Cheap Talk, Market Urbanism, Market Design, orgtheory.net.
  12. Cool Tools, Hack a Day, Jeri Ellsworth, Ken Rockwell.
  13. Cultural Learnings, The Plot Thickens.
  14. Jason Sweeney, Jessica Bigarel, Laura Jul, Lindsay Robertson, Mrs. O, The Impossible Cool, The Lawrence/Julie & Julia Project, Tokyo Camera Style.
  15. myNoSQL, Running with Data, Shtetl-Optimized, TightWind.

Thoughts on payments

Posted by Guan Yang on March 12, 2011 . 1 Response

Felix Salmon has a post today outlining his views on regulation of payments. Some thoughts:

  1. Felix says that in Scandinavia, consumer payments happen in real time. I know this is often true in Sweden, although not between all banks, but in Denmark interbank payments always take a business day. They are free for most customers if ordered online. Some banks charge a small fee. Banks are compensated through fees and because the bank earns interest on the money while it’s in “transit”.
  2. There is already an infrastructure for low-quality bank transfers between consumers. It’s not debit cards, but rather ACH debits. It is hopelessly outdated and slow, but it works. Kind of. You can use PayPal to tap into this (“Add Funds from Bank Account”), and it’s free. Dwolla, a new provider that as far as I can tell only uses ACH, charges 25 cents. My credit union charges $1, which is outrageous.
  3. Beyond the rents being extracted, a big problem with private monopolistic payment providers is that they control who gets to make payments. Right now it may not be a huge deal that PayPal restricts payments to Bradley Manning’s legal defense fund because we can always send a check or cash. This would be much harder if PayPal or a small number of other payment providers dominate the market in a cash- and checkless world. Barring illegal activity as determined after an actual conviction, I really think there should be a right to access common forms of payment.
  4. Real time payments are costly because the sending bank never knows how much liquidity to keep around. Clearing payments once a day, or perhaps more than once a day, is not a bad idea.