A post by Erick Schonfeld at TechCrunch today really got me riled up:  The SEC has shut down Prosper, a peer-to-peer lending site.  This was up in the air until yesterday:

Yesterday, the SEC issued its formal cease-and-desist letter (embedded below or download PDF), outlining its reasoning for characterizing Prosper as a seller of investment, something prosper had vigorously resisted in the past by arguing that it was merely a marketplace matching lenders and borrowers. But the SEC is having none of that.

If this sounds familiar, it's because this is an exact rerun of what happened with the original Napster and the music industry, only worse in my opinion.

The key here is that Prosper itself was not lending or borrowing, it was simply matching up willing borrowers and willing borrowers.  It also provided additional services such as collection and tracking.  The HORROR.

The real fact is, if private citizens were allowed to freely lend to one another, the private banking cartel that is our central banking system would lose the little control they have over the economy.  The free  market would freely set interest rates and people and businesses would be free to do an end-run around our corrupt and bloated financial system.  The financial engineering that has allowed Wall Street to siphon off trillions of dollars in profit at our expense would be crippled.  The SEC is simply acting as the enforcement arm of our private national banking cartel.

Don't fall under the protection of the cartel?  Goodnight, chump.

I've blogged before that I thought that a Twitter clone aimed at the enterprise world would be a stupendous idea for improving team communication and collaboration.  (I prefer to call this form of communication conversation clouds, because that's what they are in my opinion--a distributed conversation with a broad surface area.)  Today I got to take the concept for a spin, and it didn't disappoint.

Nova Spivack from Twine wrote an interesting post over at Read/WriteWeb about the future of the desktop which I'd like to comment on.  It really ties in nicely with what I've been thinking about recently around user interfaces, especially since any hardware innovations will necessarily involve an ACTUAL operating system.

I agree 100% with Nova when he says that everything is moving to the cloud.  SmugMug lets me store my high-res photos in my own Amazon S3 store, Jungle Disk lets me back up everything else to the cloud.  Storage is, for me, a monthly utility expense (and last month it only cost me $3.18, so for me this is much cheaper than hard drive space, backup, backup tapes, tracking everything, and worrying).

Working at Cisco is a new experience for me, as far as the size of the company.  Prior to Cisco the largest company I worked for was around 5000 people.  Lately I have been thinking of the advantages of being a big, well-known company, and how those advantages can be leveraged in new ways.  I have found that there are many things a startup can do that a larger company simply cannot because of size, but there are opportunities larger companies have to leverage their brand which are closed to smaller companies.

The one thing that a startup can't duplicate is company brand and history.  Brand equates to automatic relationships and trust, especially from a business perspective.  There's a certain amount of latitude and respect that you get automatically when people recognize and respect the brand of the company you're working for.  That's been a very interesting thing to observe at Cisco.

There's one use case for this trust that I haven't seen explored much:  Cross-business social analytics.  Daydreaming about this, I can see some very interesting opportunities for a trusted intermediary to become a clearinghouse for metrics and industry insight.  By having access to individual companies' data and being trusted not to share it, competitor data could be aggregated and individual companies could compare their metrics against the industry average, without anyone's data being exposed.  The only thing required is that each of the individual companies trust the clearinghouse with their data.

Personally, I think it would be incredibly useful to see how my company's issue resolution rate compared to my competitors, what my conversion rate is compared to the industry average, etc.  By consolidating this over time you could even look at industry trends against your individual metrics etc.

It would be interesting to see how open companies are to this.  If it was actually successful I can see several interesting offshoots such as the clearinghouse becoming a "credit rating agency" for the industry, providing reports that verify that the company is in fact in the Top 10% for a given metric against the industry.

The one real drawback I can see is companies might become excessively metric-driven.  For example, if software development managers started comparing a BS metric like lines of code to the industry average, that would be an extremely bad thing.

Bernard Lunn at ReadWriteWeb has an interesting post about the long-term role of LinkedIn as a business tool.  He thinks it could replace Outlook and SalesForce:

Like all social networks, LinkedIn is under pressure to "open up." They may be be able to push back on that front if they create enough value so that biz people decide to live in LinkedIn as opposed to living in Outlook and SalesForce or the equivalent CRM.

I disagree with the Outlook comment.  I think trying to be an email client would be a dumb move into an overcrowded market owned by the best in the world.  A CRM platform becomes a little more interesting, but I still think that it's not where LinkedIn needs to be long-term.

LinkedIn's value proposition, to me anyway, lies in its gigantic user base of business users and especially in the way that it validates people's claims to be who they say they are and that they actually do belong to the organization they say they do.  It's a unique value-add that I don't see any other social network doing.  And, from a business perspective, it's incredibly useful.  When you look at my LinkedIn profile and see that I work for Cisco, you know that I actually do, in fact, work for Cisco, because as part of the verification process LinkedIn sends an email to my Cisco address.  Same for professional groups within LinkedIn that I'm a member of, such as the OpenID group or the Business Intelligence group.  I can't just join as many groups as I want to, because my membership has to be accepted by the group owner.

This, to me, is LinkedIn's true value, and one that I really do appreciate and value.  It also makes LinkedIn recommendations valuable.  They now have such a large base of validated professional credentials that they could conceivably be the credit rating agency of credentials.  A broker for verified contact information.

This will become more and more useful as the Internet continues to decentralize.  While the network itself flattens and becomes more distributed, LinkedIn has the potential to sit on top of it as a trusted source of verified contact and professional association information.  This will be an extremely valuable role as time goes on because, to my knowledge, they are the only ones playing this role, and they are doing it well.

While you raise your kids to grow and protect their credit score so they can buy a car and a house some day, you may want to consider teaching them how to build their online reputation as well.  As of today that means A)  protecting their online identity (Google Juice) and B)  starting a credible LinkedIn profile.  A) has no signs of going away, B) remains to be seen as to its stickiness.

The Financial Times has an interesting article about how Web 2.0 startups have so far managed to generate a lot of buzz and behavior changes, but thus far very little in the way of actual cash.  This has been a constant wonderment to me for a long time, as it seems that people are looking for cool things and assuming it'll make money somehow down the road.  Like Twitter.

The shortage of revenue among social networks, blogs and other “social media” sites that put user-generated content and communications at their core has persisted despite more than four years of experimentation aimed at turning such sites into money-makers. Together with the US economic downturn and a shortage of initial public offerings, the failure has damped the mood in internet start-up circles.

Don't get me wrong, I love many of the sites, and several of them I would actually pay money for if they asked.  But others I suspect will either be abandoned completely or scaled way the hell down.  Twitter is cool and all, but it really should be either open source or it should be somebody taking donations to do it.  Eh, I know I'm probably the only who thinks this, but it just doesn't add much value to me--it's more a diversion than anything.  (I'd be interested to hear if anyone out there would actually be willing to pay for Twitter?)  Maybe they could actually charge people to use it now that it has this many users, but I'd bet half their users would leave instantly. 

Advertising is getting to be pointless, it's so in your face on every Web site that people are numb to it.  It's also the lazy way out, where you add so little value to your users that the only way you can conceive to get money out of the interaction is to take advantage of the fact that they won't walk away from you.  It's like a street performer who juggles advertisements or something.

“If you look at some of the valuations, you wonder what fantasy of revenues they’re based on,” said Mitchell Kertzman, a partner at Silicon Valley venture capital firm Hummer Winblad.

Agreed.  With the economy screeching to a halt, these companies will need to start making real money, real fast.  The VC money will dry up.  They must either produce real value and get paid for it or take their ball and go home.  It will be interesting to see if the last few years are later seen as one big industry-wide "try before you buy" period.

(Sorry, I found that hilarious.  I don't mean to demean your favorite buzzword ;)  Found via Giles Bowkett, so go yell at him if you're offended :)

I've been playing with Twitter for the past few days on Trent Adams' recommendation.  Here's my profile.  I never really saw the difference between Twitter and a blog plus RSS, but he said there are some good conversations that happen there which you'll miss if you're not a part of it.  And, after a few days of play time I'm actually starting to enjoy it.

What it ends up being is a personal online chat room where you pick the participants.  You need a fat client, similar to a modified instant messaging client, or it's basically useless because you don't get the realtime updates, which kills the deal.  I use Twhirl.  There's a lot of noise (for example, I tweeted (twitted?) about how much the hotel coffee sucks this morning), but it's actually pretty cool when it works as an online conversation.  I see a lot of potential in this communication model for enterprise teams.

However, Twitter was not built as a chat platform using XMPP or any of the other actual chat protocols that are available.  It was built as a micro-blogging platform using a RESTful interface, and it does not lend itself well to scaling to a vast number of users bombarding it with requests for updates.  It goes down, a lot.  Just goes to show you that buzzword technology still needs to be applied judiciously.

Twitter is a perfect candidate to switch to an RDF back-end for publishing twits.  They could make this change in a week and while the clients wouldn't automatically switch over to SPARQL querying they'd at least have a scalable back-end going forward.

Oh, and I have no idea how they could possibly monetize this thing.  This type of service can not live forever as a private service, it can only work long-term in a distributed, decentralized model.  I have a feeling it's just a glimpse into the future of messaging.

Robert Scoble is a melodramatic guy.  He thinks that because the current crop of social networks might stay closed that the Net itself is in danger.  That's only true if you think the Net as it stands today is broken, which I don't.  It's going through puberty.

He bases his assumption that the sky is falling on the fact that FaceBook is closed to Google, and he thinks Microsoft's (NASDAQ:MSFT) bid for Yahoo's (NASDAQ:YHOO) search engine is an attempt to keep FaceBook's data hidden from the Web and accessible only to Microsoft customers.  Somehow this translates to:

"Google is locked out of the Web that soon will be owned by Microsoft. We will never get an open Web back if these two deals happen."

Come on.

This is only true if you think all of the entrepreneurs out there have stopped hacking away at night at something much better than FaceBook or any of today's social networks.  Do you really think innovation will stop because FaceBook remains closed?  Did that help CompuServe or AOL?

"Don’t think this matters? It sure does. Relevancy on Yahoo search will go through the roof when it has access to Facebook data and Google doesn’t. People will see that Yahoo has people search (something I’ve asked Google for for years) and Google doesn’t. That’ll turn the tide in advertising, and all that."

Good, at least somebody will have it until we get to the next-generation Web.  It's not worth hyperventilating about.

And yes, as long as HTTP keeps working the Web will be alive and well.  As long as the roads are fine other people can show up to the party at any time.

The Web is still in its infancy.  It sounds like an absurd claim, except that the person making it is Sir Tim Berners-Lee, the guy who invented the Web in the first place.  I happen to agree with him.

The first incarnation of the Web changed the world, and what we call "Web 2.0" was only an incremental improvement on that.  It made the baby-Web usable for normal people.

I've had the pleasure of speaking with Tim on a few occasions and he is patiently waiting for everyone to get over the love-fest with what they currently know as the Web so we can focus on moving things forward and innovating again.

The end-game here, and what Tim has had in mind from the beginning, amounts to a completely new paradigm in software.  It's about creating an Internet-wide mesh of data which a given software application can use as easily as its own database. 

Fortunately, the Web is hurtling towards adolescence.  SPARQL is the glue that makes this global data mesh usable, and it was just ratified this year.  The Web's voice just cracked.

While advances like service-oriented architecture were steps in the right direction, they were still just an incremental improvement over client-server based architectures.  And as useful as that is, I think an unfortunate side-effect is that an entire generation of programmers was raised with their thinking firmly locked in the old paradigm.  I've tried to evangelize the new paradigm myself, and I can attest that it's like trying to convince people that man can actually fly using airplanes while they turn around and go back to work on pimping out their horse and buggy.

Tim's vision of the Web is the ultimate logical evolution of Web technology.  Fortunately there are some recent developments that indicate that the Web has hit a growth spurt and we may soon see another explosion of innovation based on the Next-Generation Web.

Forrester Research has made its social participation data public.  This is data which describes how a given demographic is likely to participate in a social publishing environment.  It only takes a couple of minutes to explore, and it's interesting to see the generational shifts in mindsets when dealing with social media.  If your business model involves social publishing you might want to use this for a quick sanity check.

It's also interesting that the younger the demographic, the more comfortable they are with creating new content.  I suppose this would place older content creators at a premium since they have viewpoints which not many of their peers are publishing on the Web.

Here's my demographic's social participation profile: