The Now Economy

CommerceNet has been very generous in funding my work on Zocalo for more than a year. From the beginning, it was proposed as an appointment that would last for a year or two, as part of CommerceNet’s program to bring a variety of people and projects into the labs, both to expose the particular projects to CommerceNet and its partners and to attract other entrepreneurs to visit and raise their new ideas and ventures to CommerceNet’s view. While I’ve been here, I think both sides have benefited: I’ve been able to get more exposure for Zocalo than I would have otherwise, and in getting visibility for Prediction Markets, I’ve also raised CommerceNet’s profile in some interesting arenas.

The next version of Zocalo that I release (sometime in June, I expect) will add the main features that were missing for usable long-term prediction markets. (Secure accounts, transaction history, and access controls for claim creation are checked in to sourceforge’s subversion repository, paying off claims is coming soon.) I expect to run a couple of private trials (more beta sites would be welcome) and hope to install the software on a public website so people will be able to try it out. I’m also happy that there’s another developer interested in adding some features who is talking issues over with me via email and on sourceforge.

I will continue to work at CommerceNet over the next few months, while I transition back to working on Zocalo on my own. (I was working on the code on my own nickel before CommerceNet offered to hire me and allow the code to remain open source.) I expect to work on Zocalo full-time for the rest of the year, and then spend up to half-time consulting to support continued development. The more consulting I can find that’s related to Zocalo, the less time I’ll have to spend on other work.

It’s been great fun interacting with all the people and companies that have been through here. We had some great interns last summer, and are expecting more this summer. I can’t talk about all the companies that have incubated here, but the folks that Renkoo and NewRoo were certainly cool to work with.

Zocalo’s future? I’m going to continue betting on it for a while.

I’m joining the roster at the Chicago Prediction Market summit. I’ll try to explain how Zocalo can improve the prospects for adoption of Prediction Markets in business by making the technology more accessible, and by doing a better job of publicizing results so more companies may be convinced that this is valuable technology. I’ll try to argue that the academic results are in and pretty uniformly positive; the thing that is lacking that would enable or encourage more widespread adoption is evidence that these markets produce valuable input into organizations’ deliberative processes. The existing companies selling PMs into business haven’t been able to talk enough about how these markets have helped their customers.

I’m looking forward to hearing what Cass Sunstein has to say. His article in the Hahn & Tetlock book is quite interesting. He points out that groups that make decisions as a result of meetings and discussions make common mistakes in their reasoning, and that markets seem to have opposite tendencies. In the article, he seems to suggest that markets should be used instead, but the point about countervailing tendencies suggests that finding ways to use them together might be a better approach.

Arik Johnson’s background is in competitive intelligence; he’s going to talk about how markets can be used in exploring the competitive landscape. It will be good to see Robin Hanson, Justin Wolfers, and Michael Gorham again (all were at the DIMACS event in early 2005), as well as perenials John Delaney (from Tradesports), David Perry (Consensus Point), and Emile Servan-Schreiber (NewsFutures).

It’s a Friday afternoon, and I’d like to clean up my desktop with a list o’ links I’ve found interesting over the past few weeks:

The Personal Bee aggregator for VC & Startup news. Feels a bit like some of the concepts behind Newroo/Fox. Here are several stories I got to from there:

• the MIT/Lemelson Prize for inventors goes to an LCD pioneer from Menlo Park.
• Sequoia, via Kedrosky:

  E&Y: Why is it crazy that LPs are willing to invest so much in venture capital?

  Leone: The returns have been miserable. If you take away a couple of exits, such as Google and MySpace, there haven’t been meaningful returns generated. There are [venture] firms that have never generated a positive return or have not even returned capital in 10 years that are raising money successfully. And that surprises the heck out of me. People talk about the top quartile — its not about the top quartile, it’s barely about the top decile, or even a smaller subset than that.

• Khosla Ventures actually does still invest in computer-related stuff, not just the cool new life- and green- sciences, from this BusinessWeek blogpost by Justin Hibbard:

  one of his inaugural portfolio companies was SkyBlue Technologies, Inc. The Redwood City (Calif.) startup was founded a year ago by Stanford U. computer science professor Monica S. Lam and her fellow researchers, who are developing open-source virtualization software that lets systems administrators remotely manage PCs. Traditionally, companies have used programs like CA’s Unicenter or HP OpenView for this task. Virtualization sacrifices some performance to keep the management program running independently from the PC operating system, which can become unstable. It’s a clever use of an under-exploited technology that has had a recent resurgence on server computers and has produced at least one recent hit startup, VMWare. SkyBlue calls its class of software ready-to-run (R2R) and has launched a portal site, itCasting, to promote collaboration on R2R software. William J. Raduchel, CEO of Ruckus Network and former CTO at AOL Time Warner, is on SkyBlue’s board. The company raised $1 million last August and $2.26 million from Khosla and others in March.

  [In other recent manageability news, Intel announced vPro, a desktop featureset hopefully-analgous to Centrino, raising the possibility of yet-more feature wars such as XML processing smarts on the server side. ]

The New York Times recently had a piece on academics investigating the IBM-sponsored “services science” field

ComputerWorld’s Gary Anthes, a dedicated reporter on the research-and-innovation beat, wrote a piece on the looming anniversaries of the oldest CS departments.:

• John Canny, chairman of the electrical engineering and computer science department, University of California, Berkeley: “Computers aren’t very valuable yet, because the applications they perform are still elementary and routine. It’s actually remarkable how much we spend on IT, considering how little it does. The most widespread applications are still e-mail and Microsoft Office. That should tell us something.

  What we really need to be thinking about is what people are doing with computers and how we could help them to do those things much better. Since most people are doing knowledge tasks, that means machines understanding their owners’ work processes much more deeply, finding semantically appropriate resources with or without being asked, critiquing choices and suggesting better ones, and tracking synergies with other groups within a large organization. Computers will leverage the human resources in the company more at a knowledge level. They will directly tie what they do to the creative processes of employees. The economic impact of that would be much bigger than anything we have seen so far. ”

• Jaime Carbonell, director of the Language Technologies Institute, Carnegie Mellon University: “Artificial intelligence. Although those words may be somewhat out of fashion these days, much of the deep excitement and universally useful apps descend therefrom. For example: speech understanding and synthesis in handheld devices, in cars, in laptops; machine translation of text and spoken language; new search engines that find what you want, not just Web pages that contain query words; self-healing software, including adaptive networks that reconfigure for reliability; robotics for mine safety, planetary exploration; prosthetics for medical/nursing care and manufacturing; game theory for electronic commerce, auctions and their design to ensure fairness and market liquidity and maximize aggregate social wealth.”
• Bernard Chazelle, professor of computer science, Princeton University: I roll my eyes when I hear students say, “CS is boring, so I’ll go into finance.” Do they know how dull it is to spend all-nighters running the numbers for a merger-and-acquisition deal? No.
• Canny: We’re losing in quality — principally to bioengineering, which is now the best students’ top choice — and diversity. It’s a problem of social relevance. Minorities and women moved fastest into areas such as law and medicine that have obvious and compelling social impact. We’ve never cared much about social impact in CS.
• Chazelle: Much of the curriculum is antiquated. Why are we still demanding fluency in assembly language today for our CS majors? Some curricula seem built almost entirely around the mastery of Java. This is criminal.

  The curriculum is changing to fulfill the true promise of CS, which is to provide a conceptual framework for other fields. Students need to understand there’s more, vastly more, to CS than writing the next version of Windows. For example, at Princeton, we have people who major in CS because they want to do life sciences or policy work related to security, or even high-tech music. In all three cases, we offer tracks that allow them to acquire the technical background to make them intellectually equipped to pursue these cross-disciplinary activities at the highest level.

• Carbonell: CS needs a great communicator who lives the excitement, is deeply respected by his or her peers, and can reach out and communicate clearly with any educated person via his books. We have no such person in CS. Perhaps Raj Reddy [a Carnegie Mellon computer science professor] has the right kind of talents.

Finally, please don’t miss Bill Burnham’s excellent survey of opportunites to push ‘persistent search’ forward.