Wednesday, October 3, 2012

This Week in Pictures

Nokia CEO Elop
Stephen Elop in a trance, pledging eternal servitude to his master, in a ritual amid a fiery orange backdrop. The unidentified man on the right, presumed to be Lord Satan, is seen consuming Elop's soul via inhalation.

Thursday, May 24, 2012

Post Picayune lowers Nokia target price to $0.00

A lot of people wonder: When will Microsoft buy up the remains of Nokia, now that they ****** their *** up like in a car crash? How low does the stock have to go before MS buys the cadaver?

Here is my prediction: $0.00.

Why? Because as long as MS has a man on the inside (Stephen Elop... inside and all the way up), they already own Nokia as much as they need to.

People expect MS to bail out Nokia and prevent it from failing. When would they do that? Answer: When the stock price reaches $0.00. At that price, it means that investors do not expect to have any ROI at all from a purchase of Nokia. It is essentially the value of a bankrupt company. If the stock price is above that, it means that Nokia's probably not bankrupt and still has its own assets to waste on its survival. So why would MS throw its own money onto the fire when Nokia is still burning away quite toastily?

What factors determine NOK's current price, which has a market cap lower than its book value (ie. it is undervalued)?
1. Expectation that Nokia will burn through its cash and may go bankrupt in a year or three, and that it is completely committed to this doomed fate, pushes the price toward $0.
2. The possibility that it will become profitable in the next few quarters keeps it away from $0, but its current trajectory suggests that this is not likely without some miracle.
3. The possibility that Elop will be fired, and the stock will jump, and that the company can be turned around or even that the company will be liquidated before it goes bankrupt, makes for a long-shot bet that the stock will be worth a lot more than it is now.

In my estimate, many investors have hope that Nokia will stop doing what it's doing and what it has publicly committed to keep doing, and fewer have hope that they'll stick to their plan and succeed, while most investors expect them to stick to the plan and fail.

If MS doesn't already control Nokia's shareholders, then there is a chance that Nokia will come to its senses and fire Elop. In that case, we're talking about a different game. First, there will be a jump in the stock price simply from the renewed hope that Nokia may turn itself around without Elop. But there will also be a jump if there is a perception that MS no longer owns the company. If people believe that MS still wants to control Nokia, then at that point they may need to pay more than $0.00 for it, and the price will go up depending on how much they are seen to need it.

If the current trend continues---Nokia failing in its Windows Phone strategy and yet remaining committed to its own doom---I think that it indicates a general understanding that Nokia is completely controlled by MS, and that MS has no interest in seeing Nokia succeed. If MS only needs Nokia to stay afloat, it can do so at a value as low as $0. A bailout at any higher means that MS is--or wants people to see that they are--committed to Nokia's success, not just their existence. MS just doesn't roll that way. If anything, they might want such a bailout to be done secretly, so that it's not seen as the embarrassment of "WP manufacturers have to be propped up." If these speculations are indeed true, then Nokia stock price and book value should head for $0 in absence of some great success for WP and/or a shareholder revolt.

Disclosure: I have no position in either of the stocks mentioned, and I would rather see MSFT dead and buried in a pile of its own pig feces than consider investing in them, and it would be nice if NOK got the hell away from MS and climbed out of the grave Elop's been relentlessly digging for them.

I was looking for a job, and then I found a job. And heaven knows I'm miserable now

In the movie American Splendor, Harvey wakes up from a nightmare to his comforting reality: "I got a job! I got a job!"

For me "I got a job" is the nightmare from which to wake.

Most people seem to treat a job as a necessity. They wish me luck in finding gainful employment. They treat it as if I'm missing out on something.

I do not see it that way.

Work is not a necessity. Work is usually only a means to fulfil other (real) necessities. Satisfying work may also be a luxury.

Further I submit that no woman or man is truly free who needs to do work for someone else in order to eat. I realize I'm speaking of an ideal world and not the reality we currently exist in, but I do believe that almost no one is truly free in our world (for this and any multitude of other reasons).

If you are forced to do the work that another commands, just so you are able to survive, then you are a slave. Even if work is inescapable in life, a free person would at least do work according to her own will, not the will of others.

I think most would vehemently disagree, because most feel they need their jobs (and they pretty much do, because they're enslaved by employers and a society built to avoid making it easy to not work), and the thought that "this is how reality is" is easier to accept than the thought that "there are many other options, but they're kept from me." It is more comforting to believe that we are in control of a reality with many inherent limits, than it is to accept being controlled and limited by others.

Until things change (and they will, whether in a hundred, or a thousand, or a million years), it seems the only way to escape the "work is a necessity" mentality is not just a change in attitude, but some combination of a change in lifestyle, luck, ... and hard work.

Wednesday, April 11, 2012

We lose money on every sale, but we'll make it up in volume.

I came across this story, of Nokia offering a $100 credit due to a major glitch in Lumia 900 phones. The glitch prevents data access, and is a software issue that "is being fixed". The credit is being offered on phone sales up until April 21, even though Nokia says fixed phones will be in the stores within a couple days. Nokia says the purpose of the credit is to "give you something for your inconvenience".

I call bullshits.

You don't give a $100 credit for the inconvenience of buying a working phone. Assuming that Nokia actually can fix the phones in a timely fashion, new customers are not going to be inconvenienced (at least not by this particular bug). So either Nokia is saying that these phones are going to continue being an inconvenience, or they really need a drop in price to get the phone closer to its actual market value.

With the credit, the price of the phone becomes $0 with a typical expensive contract. Clearly, the phone has no perceived value on its own. But Nokia doesn't want to sell it that way... they're trying to compete with the higher-end smart phones. Or rather, they need to---this is the longshot bet that Elop risked the entire company on (burning Nokia's existing platform in favour of making crappy WP7 phones that nobody wants)---and if they can't sell phones (at any cost) they go the way of the dinosaurs.

This is basically just Nokia dropping the price of the phone to the bargain basement in a desperate attempt to try to get people to buy it. But they don't want the stigma of being a lower-class phone, so instead of admitting that their $99.99 phone is worth $0, they're trying to spin their financial desperation into a story of "We really really really care about our customers!"

There is a problem though. The perceived value of the phone is still $0. Whatever the reason for the price drop, it can be got for $0 (plus expensive contract). Come April 21, a $0 phone will suddenly jump in price by $100. Will anyone want to buy it after that?

My bet is that Nokia will be forced to keep their discount. Perhaps they already know this and have planned for it. Perhaps they will say "Due to demand and our ongoing commitment to our customers, we've decided to extend the $100 credit." This way, they can compete with the cheaper phones without admitting to being a low-value phone, and while they can try to use their "limited time offer!" to scam/entice new customers now, they can also continue to beg for customers in the longer term.

Some remaining questions:
- How much money are Microsoft and Nokia willing to throw at this market to establish a user base that they can start exploiting?
- How much will it take for customers to be tricked into becoming WP7 users? Comments on the cnet story indicate that $100 off of an expensive contract is enough.
- If things continue to go badly for WP7, will MS bleed money until they've choked their way into the market, no matter how long it takes, or will they give up?

Everyone knows that Nokia's not going to survive long enough for WP7 to buy its own success (unless they fire Elop and get off that sinking ship). Sure MS has the cash to survive, but they're not exactly known for making room on the lifeboat for their "partners". No, partners are kicked off their pant-legs and left to drown (sometimes helped by a knife in the back). Everyone expects that Nokia's going down, and that MS will swoop in at the last minute only to buy them up once their value has bottomed out. MS will be in this for the long haul. As far as I can tell, MS's business model is to throw money at a market until it suffocates everyone including themselves, knowing that they can afford to wait it out. This time though I don't think they'll be able to suffocate Apple or Android. This is business as usual in tech. It's not about making the best product and competing on value, it's about driving the competition away, putting pressure on them through marketing or patent litigation, until they're gone. The Lumia series is MS's investment in their dream phone monopoly. Then you won't be seeing $100 credits to buy off customer inconvenience.

Update: May 23, 2012: Prior to breaking this story I was perhaps the most accurate predictor of WP7's road to failure, having never made a wrong prediction about it --- at the very least I was up there with Tomi --- but I have to admit that I did miss the mark on this one.

After April 21st came and went, I did see some ads for a sale price of $49, but generally the price with contract seemed to be back up to $99. Now the price has been dropped to $10 (for existing customers) and $40 (for new customers). It's getting pretty close back down to $0 (with expensive contract).

Nokia wasn't as desperate as I anticipated. Now we will have to wait for the Q2 results to see if they really were desperate and failing but tried to act successful as a marketing strategy (a ruse that can't last forever. MS employees may spend their days writing up glowing Amazon reviews of the Lumia 900, and execs may claim that WP outsells iPhone in China while still refusing to give any of the obviously embarrassing sales numbers, but without some Enron-style fudging of the books, Nokia's balance sheet is going to tell the real story eventually.)

Hilariously, in this writeup of the Lumia 900 price cut, the author says that "seeing that time has passed since its launch, it’s naturally going to see some price drops." This is after one month at "full" price! A bargain basement price after 1 month, while still many months away from a successor product being available, does not make a "natural" price drop and does not bode well.

Even more hilariously, the author claims that "it shows us that Windows Phones can stand equally amongst its peers." I don't think that a price drop to $10 shows that WP can stand equally amongst its peers. I'd say at best it stands at 5% of its peers, based on an iPhone price (with contract) of $200.

Windows phone is a joke. It's too bad that it's all at Nokia's expense. Poor Nokia, you got scammed! When are you going to kick Elop out? Nokia shareholders: Did you make a mistake buying into that rotten potato Elop? Or are you continually being conned by a CEO who is not acting in Nokia's interests? This begs for an official investigation.

Wednesday, February 29, 2012

Microsoft redefines just about everything

MS is making a Consumer Preview of Windows 8 available for download, installation, rebooting, and rebooting once or twice more today. The company has made major changes to the clunky UI that's been around since the days of Windows 95, including some innovative features that make win8 the first OS to catch up to a few of the features that have been around in OSX, iOS, and some Linux UI managers for a few years now.

With Metro, gone is the tired, old metaphor of clicking on full-color square icons to run a program. The new hotness involves simply tapping on monochrome square tiles to interact with an app! Clicking these new tiles to run an app, er... that is, tapping icons to interact with programs is just a paradigm shift in outside-of-the-box thinking when it comes to streamlining my computer synergy, especially compared to the old method of clicking on squares to run... uh... apps, I guess. In retrospect, the user experience of all the shitty old windows versions (everything before 8, I mean) was just really dreadful.

Surely that's all going to change, this time for sure, with all the new definitions and no more of those distracting multiple colors.

I haven't tried out this amazing piece of software yet, but I can report on some anticipated changes that are likely to debut in windows 8:
  • Users can tap on tiles using either a FeelSurface or their gerbils.
  • Apps can store data in one or more boxes, arranged in various drawers in the computer's main shipping container.
  • The Start Menu has been replaced by a list of apps that can be started via the new Launch Cookbook.
  • Gone are the awful days of the Blue Screen of Death. The functionality of the unpopular feature is now handled by the Full-screen Indicator of Unscheduled Coffee Break.
This changes everything! Users who've been screwed over by Microsoft for decades now, time after time, might just want to give MS one more chance yet again to try to not rape them. Eight just might be your lucky number for not getting raped. If not, be assured that the Picayune Tech Squad is the place to be for hopeful speculation about 9, after 8 turns out to be more of the same crap that we've always seen from MS. Surely it's all going to change, with Nine for sure!

Update, March 13, 2012: We broke the story first! The mainstream news is catching up to the realization that 8 is going to be crap but 9... maybe 9 will be good! Slashdot is confirming that 8 will be a mistake. "The company needs to learn from its mistakes as quickly and nimbly as they can — and then turn around and make Windows 9 exceed all of our expectations."

If not, then 10. Or 11. It is statistically impossible for Microsoft to deliver with perfect consistency such utter useless shit every time. Eventually they will slip up and accidentally make something that doesn't make their users' lives hell.

Wednesday, February 22, 2012

Hacked by parasitic greedhead scam

There are some jobs that I don't think need to exist at all. These include, among countless others:
  • Baby-seal pulverizer
  • TSA crotchprober/deathray technician
  • Telephone scamvertiser
  • Realtor(R)
That little (R) is there so that no one else can say they do what a realtor does, so if all the realtors demand outrageous fees, what can you do but accept it?
Opposing or intended to regulate business monopolies, such as trusts or cartels, especially in the interest of promoting competition

A cartel is a formal (explicit) agreement among competing firms. It is a formal organization of producers and manufacturers that agree to fix prices, marketing, and production.

REALTOR® members [...] are the only ones who have the right to list your property on the MLS® Systems of their local real estate boards.
MLS® and the corresponding web site have changed the way people search for homes, and it's hard to court buyers without it.

Let us consider the economics of realtor fees. For a $400,000 house, the standard realtor fee will run you 4% of the house value (it's higher for less expensive houses). If you move houses several times in your life, you're skimming one 25th of your house value every time, and giving it to someone who has "earned" that much of your property by helping you sell it.

What does that number mean in conceptual terms? Suppose you have a 25-year mortgage on your house. Every year you pay off one 25th of the house. Pick one of those years, and say "This one's for my Realtor." Then go to work every workday that year, and start the day thinking "I do this for my Realtor." Put a smiling picture of them on your cubicle wall for motivation, if it's getting you down.

To be fair, you don't devote all your time to work, and you don't devote all your income to your mortgage. So maybe think "Here's some for my Realtor, here's some to feed my kids.*"

And remember, it's only one year of your life you'd need to do this for! One... for each time you move, I mean.

But perhaps it's worth it. Perhaps your Realtor will devote a year of work to selling your house.

* If you do choose to think of it in terms of food, you may wish to calculate how much is going to your kids and how much to your Realtor. If you spend $300 per month on food for the kids, it will take 4.44 years, not one, to add up to our example realtor fees. So you may choose to spend 4.44 years devoting equal time to your realtor and to feeding your kids, or you may wish to for example dedicate the first hour of work to your kids, and the next 4.44 to your realtor. Again, that's only for one tiny insignificant year of your life.

Thursday, February 2, 2012

MPs Really Get Behind Seal Hunt

Canada's embattled sealing industry has been suffering these past few years, bleeding like a dead bag of meat left out on the snow (Photo Gallery with the Huff Post story).

Some conservative MPs are lending their support this year by participating in the seal hunt. MPs donned clubs and enthusiastic smiles as they paused for photo ops in between manic sessions of bashing in the brains of some cute baby seals.

"It's a lot of fun," said one MP, catching his breath and wiping some spattered blood from his lips. "Maybe we could expand the industry with an adventure-tourism aspect. I think that for many people, if they had a chance to bash in the face of one of the little critters, they wouldn't have such negative feelings towards it."

The MPs pinned dead seals to their lapels. "It's quite patriotic, I think, almost like a Canadian flag really. All that red and white."

One of the MPs held out a baby seal carcass to members of the press, offering it for sale. When there were no takers, the MP remarked "Well that's certainly odd. The market for dead seals is actually quite healthy."