The End of Blockbusters and New Start-ups?

Out with the old and in with the new once more. Last month it was Blockbusters, the global giant of video rentals, closing their last few doors for the last time in the USA, as they filed for bankruptcy. Technology has overtaken them, their model of offering films for rent is obsolete.

Many stores are closing

Many stores are closing

Even in the UK where I grew up there seemed to be one on every corner. I used to walk round of an evening and thumb through the Betamax section (my mum had Betamax, much better quality than VHS, not widely used in a domestic setting but still used today for broadcasting).

For youngsters reading this article, the idea was that you take the film home and watch it and then return it the day after. Yes I know it sounds ridiculous, but if you forgot to return it you paid overdue fees, and these alone made $800 million in the year 2000, and that was less than 20% of the company’s operating profits!

And the rise was incredibly fast. In its first 15 years of operation Blockbuster grew from nothing to more than 9000 stores, even today it still boasts 3000, although they have been losing money hand over fist for more than a decade.

Netflix put an end to the party, but how could such a giant in the entertainment industry miss out on an opportunity to move forward. Back in 2002 they could have bought the Netflix operation for next to nothing, but the then CEO never thought it would take off. How wrong could he be?

Well here in Cambridge Massachusetts they have devised a system in order to try and stay on track with such developments, although I am not sure it is a good one. There is a huge culture of start-up funding, with an entire industry revolving around funding such new ventures.

We have the Mass Challenge competition that gives away more than a million dollars a year, loads of networking meetings and funding workshops. But what are these investors looking for? They are looking for the next Netflix or Amazon obviously, and they are prepared to put large sums of money into anything that looks like it might develop into something of the sort.

There are a lot of start-ups here that manage to spend a million a year for several years without ever turning a profit. A few hundred thousand on lawyers each year, nice office space, public presentations, and the investors keep coming in looking to make a fortune on the next new thing.

Just to give an idea of how much money is invested if we take a look at Mass Challenge they have invested $472 million in the last 4 years, and that has made a return income of $194 million. This investment has created 3928 jobs although we don’t know how many of them exist today.

All well intentioned I am sure but that means they have so far lost $278 million in 4 years. But they have created jobs, although at a cost of almost $71000 each. Not a great return, but we are talking about a not for profit organization investing private money so presumably everyone is happy.

I just wonder whether a more efficient model could be found, while not missing out on the next best thing of course. And I wonder how ethical investment choices are made. We are dealing with huge resources, and resources are the key to shaping the development of society. How much of this money could be said to be invested for the good of society? And how long can this type of approach continue whan 3 out of 4 fail?

I should just add that I use Zipcar, a local car sharing start up, so I don’t want to sound too critical. They have taken many cars off the road, which can only be a good thing. Several other food start ups work for social good, but they feel cut out of the funding cycle. See this post I wrote for IX about their positions.

Sequencing Baby DNA, a Project in Boston

Last week the Science in Mind blog on my local Boston.com website ran an interesting story that is definitely worthy of reflection. It involves 2 local hospitals that are carrying out a project funded by the National Institute of Health (USA). The projects involve sequencing the DNA of newly born babies over the next 5 years. Read all about it here.

Babies to have their DNA sequenced

Babies to have their DNA sequenced

Now sequencing the DNA of babies carries with it several risks and ethical concerns, as well as well argued benefits. If we take the benefits first, doctors may gain information about a baby, such as high risk for a certain disease, genetic mutations that may require changes of lifestyle etc. They might also find explanations for problems that might otherwise go undetected.

There are though as I say risks and concerns. How will parents react if they discover that their baby has a high risk of an incurable disease? How will the knowledge gained through the test effect the way the parents view and behave towards their children? Are we giving families information that will change their understanding of parenting to such a degree that it might destroy the very fabric of their social relationships?

This is not to mention the social implications of giving out such information regarding extended family. If for example I am told that my baby has a genetic mutation carried by the parents that might have a serious effect on its life, should I tell my brothers and cousins so that they can screen their prospective wives, make decisions about having children or even worse a pregnancy already in course? And not to mention the obvious problem of discovering that the father is not the man stood in the room with the mother.

These problems are in fact the issues that the researchers running the project are hoping to look into. The question is if the clinical benefits outweigh the risks of such an approach.

I have written a lot about this subject in recent years if you would like more to read:

In June of last year I wrote a post here on Technology Bloggers called Sequencing the Genome of Unborn Babies. I also raised a lot of similar ethical concerns in May of the same year in Home Genetic Testing, Pros and Cons.

On the Bassetti Foundation we find DNA Privacy Issues from January of this year, a series called Architectures for Life from 2012 and a review of a book called Go Ask Your Father, just for starters.

My own personal view is that much of the promise peddled to us surrounding medicine and the sequencing of the human genome has yet to be delivered. One problem is money. Personalized medicine sounds like a great idea. I get my genome sequenced, we can see which drugs might work the best, the type of treatment I need etc. But drug companies cannot make, test and market a drug especially for me even with all of this information, it is just not cost effective. They want big sellers, generic medicines that work to some extent on everybody, not something that is fantastic for me with my particular gene pool.

There are clinical benefits, I am not arguing otherwise, but we must wait to see how great.

Boston Bombs and the Billboard Problem

As I am sure many of you will already know, last week was a difficult one to say the least for my fellow citizens of Boston and Cambridge.

The events have caused a debate here though about the use of advertising technology. In the US many places host digital billboards. They are enormous, bright, attract attention and the content can be changed at will, using a computer and not a pole with wallpaper paste on it. Many change every 10 or 20 seconds, allowing great generation of revenue for both the publicity companies and the cities and states that license their use.

Digital Billboards In Use

Digital Billboards In Use

I first saw something like these while watching the Premier League, boards that changed by the side of the pitch through a disk system, but the modern equivalent are just like watching giant TV’s, in HD quality no less.

So why the debate? Well it turns out that the FBI have contracts with the largest billboard operators, and they can take over any number of the appliances and show what they want. In the case of Boston the contract is with Clear Channel Communications, and this allowed the FBI to show the photos of the two presumed bombers. Direct to the public marketing, for those of us still living without TV and smartphone (yes I am).

But many groups argue that the billboards themselves are dangerous and present a distraction to drivers, and many are placed in residential areas causing numerous complaints. Light pollution as much as skyline destruction are both problems when they are placed in residential or historic areas. The City of Los Angeles has in fact recently taken many of them offline on these grounds as this article explains, and pressure groups exist that campaign for their removal.

A Distraction?

A Distraction or an eyesore?

In all fairness they are not all trying to ban them, but to place them only in commercial districts where they do not cause distraction, but as you might imagine this does not go down too well. Distraction (or attention anyway) is after all one of their main goals.

But there is a lot of money involved. The city of Chicago hopes to raise $155 million by placing billboards throughout the city. The City recently approved a deal as this article explains.

The State of New Jersey has just struck down a ban on their use, again hoping to raise much needed funds.

The FBI argue that they are useful tools in crime prevention, stating that they have already apprehended 51 fugitives after posting their faces on billboards, and insist on their position as a public good. The debate rages and I am sure will continue on for some time.

The Scenic America website offers links to several safety studies regarding digital billboards for the interested reader.

On a lighter note and thinking about my post last week I wonder if they are on Shodan and easily hacked? That might be interesting.

The end of Anonymity?

Over recent years many people have had their DNA analysed and results posted online. The results have been anonymised, but the vast spread of information on the web calls into doubt the possibility of really making information untraceable.

Last week the Boston Globe ran a story reporting an article published in the journal Science, in which researchers demonstrate how they correctly identified individual identities of the owners of some of this DNA.

DNA

DNA, a personal business

Scientists at the Whitehead Institute for Biomedical Research wanted to identify the owners of anonymous DNA samples that are available for research purposes online. They did not have any high technology, using ancestor tracing websites and freely available public documents.

We are not talking about hackers or expensive programs, we are talking about people with every-day computers and the same understanding of how they work as you or I.

It took a single researcher with an Internet connection about three to seven hours per person, and all in all the identities of more than 50 participants were discovered.

This raises several issues. What about all of those people who gave materials for research who find themselves posted and traceable on the Internet? What obligations do commercial companies such as 23andMe have towards their customers, operating in a more or less unregulated environment? (see here for posts about their organization). Can there be real guarantees of anonymity in modern life? Given the obvious advantages of data gathering how can it better be shared in order to protect individual owners?

The very scientists who conducted the research argue that the privacy problem needs to be completely re-analysed, with some scientists dubious that privacy to any extent can be guaranteed.

Problems related to this are both practical and philosophical. In the US the GINA legislation was set up to protect individuals from the effects of their DNA codes (and analysis of it) falling into the ‘wrong hands’. The wrong hands in this case are those of health insurance companies, that might not want to insure a person (or may want to charge more) because they have one particular gene mutation or another.

There are shortcomings however, the GINA legislation does not allow health insurance companies to discriminate on the basis of DNA testing, but other insurance companies are not legislated against. Life insurance and long term care insurance is not covered under the document, so in theory they would be free to decline cover on the basis of DNA analysis. This is particularly important as long term care is extremely expensive and is not covered through health insurance.

Given that anyone who has given their DNA for research purposes risks being identified, they may also risk discrimination.