Avaktavyam » Commerce

Unscrupulous people stealing financial information

Louis-Dominique — Sat, 01 Aug 2009 12:37:06 +0000

When it comes to securing the data I have on my computers, I take the task seriously. I use Ubuntu and Windows on my laptop. The Ubuntu installation is fully encrypted. There’s a performance hit but I feel pretty sure that if my laptop is ever stolen or lost or needs service by a third party, I won’t be at risk of getting sensitive information stolen. The Windows side is not (yet) encrypted but I do not use Windows intensively or for sensitive tasks so I’m not very worried about that.

Now, when I talk to other people about this, I’m told that I’m paranoid. If I’m not keeping porn on my laptop, I have nothing to worry about. If my laptop is stolen, no one will take time to look for banking information. The techs who perform service are interested searching for porn, not financial details. Basically, I’m told I’m worrying for nothing. (Now, logically-minded readers will have figured out that the flip side of this bad reasoning is that if I do worry about people snooping through my hard disk, then it means I must have porn on there.)

Well, well, it turns out that a Sky News undercover investigation that technicians do indeed look for financial information on the laptop they service and they try to use it to break into banking accounts. OMG! Who would have thunk?

The solution against unscrupulous technicians is to give them a clean drive: a drive which contains no sensitive information. My point here is not that encryption is the solution but that unscrupulous people are indeed after your financial information. Encryption is part of the arsenal of tools to protect against that.

Strange rationalization

Louis-Dominique — Wed, 24 Jun 2009 12:48:29 +0000

I’ve been researching espresso machines a bit some months ago with the intent of buying one. (I’ve eventually decided against it.) I found that good machines are expensive. I also found a fairly peculiar bit of rationalization in discussion forums.

Let me be clear: I don’t find it inherently problematic that people spend big bucks on espresso machines. I probably spend more money on my computers than most people do. I’ve seen people happy with cheap laptops but these machines usually do not have enough power for my needs. So I understand that people would want to pay significant money for something they are going to use and enjoy.

This, however, is just weird:

“After I get my espresso machine, I won’t have to go to Starbucks anymore and will thus recover the cost of the machine. Overall, I’m going to save money. See, two coffees in the morning plus two in the afternoon, that’s X dollars per day so after Y days, I’ll be in the clear. And there’s also the gas saved!”

The above is a paraphrase of a rationalization I’ve seen several times on websites dedicated to discussing coffee and espresso machines. Now, I find the scenario presented in that rationalization rather unlikely. I don’t know anyone who goes to Starbucks to get four coffees per day. We can assume that there are people who drive to Starbucks on their way to work and then leave work in the afternoon to get more coffee. If a couple living together does that, then that’s four coffees per day. It is still peculiar that they would do that seven days a week. Moreover, if the home espresso machine takes care of the afternoon needs, on a work day it means that the couple would have to drive home in the afternoon to make their coffee. Home would have to be at a fairly close distance from work and would have to have enough time to drive back and forth and make the espresso. In addition, the scenario does not take into account times when one just does not feel like messing with the darn espresso machine but would rather just go to Starbucks. Now, I know some people work at home, or they have their coffee in the evening (good luck sleeping!), or whatever so their situation can validate the rationalization. I find the scenario very unlikely but, okay, it is possible.

It is puzzling though that one would have to pretend that buying an espresso machine for home is some sort of wise financial move. If money is really an issue, here’s a simpler solution: stop buying four coffees per day from Starbucks. Just stop buying from them. It is a net gain. It is this simple. Let me reiterate that if someone wants to buy an espresso machine because they are going to enjoy making espressos at home, by all means do it but a financial rationalization for it sounds hollow.

Dear Cessna: Correlation is not Causation

Louis-Dominique — Sun, 07 Jun 2009 13:06:28 +0000

Cessna has put out a piece of propaganda containing this gem:

Study after study shows companies operating business aircraft outperform competitors that don’t.

The implication is: buy a business aircraft for your company and you’ll outperform your competitors. Dear Cessna, is this really the logic you want to espouse? Has it occurred to you that maybe causality runs opposite to what you imply? Could it be that companies which are successful due to other factors are enough money to spend it on planes and on frivolous purchases? Does this seem possible? Maybe?

Yeaaahhh, I thought so.

An experiment

Louis-Dominique — Thu, 19 Mar 2009 13:35:04 +0000

Readers will notice that I’ve added Google ads to my site. I’ve tried to make them as unobtrusive as possible. This is an experiment I’m running to experience for myself what the fuss is all about.

Great Journalism: The Collapse of the Banking System Explained

Louis-Dominique — Sun, 08 Mar 2009 01:20:18 +0000

I’ve been ranting several times here about how journalists in the US have abdicated their role. They’ve stopped asking the hard questions. Does this mean that all journalism has gone to hell? No. There are still journalists out there doing a spectacular job. I have for evidence an episode of This American Life about the collapse of the banking system. It is intelligent, clear and asks hard questions. Anybody who wants to understand the current crisis should listen to this.

The free market fallacy

Louis-Dominique — Mon, 22 Sep 2008 02:32:50 +0000

A few minutes ago, I came across yet another AP news item about the current financial crisis in the US. The article reports that Barack Obama “said the final product must protect U.S. taxpayers and include a commitment to new regulatory reforms.” My first thought was “hell, yeah!” there has to be some sort of regulation to prevent this nonsense from occurring again. My second thought was “surely the free market advocates are going to come out of the woodwork to criticize this.”

Now I’m going to explain the situation as I see it. I’m not an economist, mind you. So economists are likely to find this awkward.

According to the “free market” theory, markets are able to self-regulate. Business practice which produce no value cannot survive in a market because the market will not provide the means for those practices to perpetuate themselves. The current crisis can be taken as an example. The bankruptcies we are witnessing are precisely how the market is self-regulating itself. Financial institutions engaged in practices which did not produce value. It was not immediately apparent to the market that there was a problem but as soon as the problem became evident, the means of support for those practices evaporated and the market corrected itself. So far so good. The market does actually seem to regulate itself.

Yet, this does not mean that governmental regulation is not desirable. Here’s the problem. The swings of the market are affecting the lives of real people. The proponents of the free market view the processes which influence the market as if it were a pure cybernetic system. There are inputs, feedback loops and outputs and that’s all there is to it. The human factor is excluded entirely. Yes, the market will regulate itself but this regulating process is not without consequences. People lose their homes, their retirement funds, their jobs, etc. Financial rules could be established to help prevent business practices based on illusory value. They would dampen the swings so to speak.

Then there is the fact that the market as a whole is driven by decisions taken in micro-contexts. These decisions are rarely made to benefit the market as a whole. On the contrary, they are made to benefit whomever is the most powerful stakeholder in the micro-context in which the decision is made. A common example is the CEO who slashes a company’s R&D. This improves the balance sheet in the short run because a significant expense has been eliminated but it also cripples the company’s capability to compete in the future. I think the situation is similar in the case of the bad loans which were issued. Issuing those loans seemed like a good deal seen from the point of view of the micro-contexts in which those loans were issued. Nobody paid any attention to the fact that as a whole the lending practices were unsustainable.

To sum up, yes the market can regulate itself but the swings of the market are damaging to our society. It does not benefit society as a whole to let the market prop itself up by means of illusory value and then correct itself later.

Pier 1’s Aggressive Direct Mailing Practices

Louis-Dominique — Thu, 14 Feb 2008 13:17:47 +0000

Executive Summary: On November 28, 2007, I put in a request through CatalogChoice.org to stop receiving Pier 1’s catalogs. I visited Catalog Choice’s site on January 25th to find that Pier 1 refused my request. In effect, Pier 1 is refusing to collaborate with Catalog Choice. When I complained to Pier 1, the CSR told me that Pier 1 accepts requests to stop receiving their catalog only through the Direct Marketing Association (DMA) or if contacted directly but not through Catalog Choice. In my opinion, this clearly shows that Pier 1 has decided to adopt aggressive practices when it comes to advertising to potential customers.

My first communication with Pier 1 regarding this occurred on Jan 25th. I sent an email to their customer service department saying grosso modo the following. 1) We don’t want Pier 1’s catalog. 2) Sending paper catalogs to people who don’t want them is not environmentally sound. 3) Pier 1 is also wasting its money when it sends catalogs to people who don’t want them. 4) Pier 1’s refusing our request shows that they don’t care about us as clients. 5) Pier 1’s refusal to honor our request is unreasonable. Hence, although we’ve enjoyed Pier 1’s offerings in the past, we’re unlikely to shop there again.

The reply I got said that Pier 1 does not accept request through Catalog Choice but they accept requests through the DMA and requests from people contacting Pier 1 directly. It is at this point that Pier 1’s aggressivity really came through. Let me explain how both options are aggressive towards customers.

Here is what the DMA has to say about themselves:

The Direct Marketing Association is the leading global trade association of business and nonprofit organizations using and supporting direct marketing tools and techniques.

The DMA is an association of businesses, not an association of customers. Therefore, I do not believe that the DMA is the best representative of my interests as a customer. In fact, when I think about the DMA, here are the things that come to mind: invasion of privacy, time robbers, undesirable interruptions, harassing behavior, and so on and so forth. Moreover, the DMA is actively lobbying governments to kill legislation that would help customers get rid of unwanted advertising. Let me make this clear: the DMA is working against the interests of costumers who want more control over what gets in their mailbox. Is the DMA the best organization to contact to get my privacy rights respected?

Moreover, the DMA is patently hostile to Catalog Choice. I have for evidence this blog post on Catalog Choice’s web site:

In spite of our efforts not to demonize the industry, the Direct Marketing Association continues to send messages to catalog companies that paint Catalog Choice as the devil. The nasty things they say about Catalog Choice make us think that they are worried about the power of your wishes. Instead of working in the best interest of consumers, the actions of the DMA are driving a serious wedge between consumers and catalog companies. We think that’s bad business.

(Note that this specific piece of information was not known to me until yesterday so I never communicated it to Pier 1.)

Finally, the web site that the DMA has created to opt out of mailing lists is confusing to use and does not provide the same level of functionality as Catalog Choice. From what I understand on the DMA’s site, if I go through them I have two options: either I’m on everyone’s mailing list and then I get all catalogs or I’m off the list and I get no catalogs at all. Catalog Choice allows us to select *which* catalog we want to continue receiving and which catalogs we do not want. The Catalog Choice site is well designed and easy to use.

For all of the above reasons, the method of going through the DMA to stop receiving Pier 1’s catalog is unacceptable. It is in fact downright hostile.

Contacting Pier 1 directly is also unacceptable. The reasoning here is that if I have to hunt down phone numbers or email addresses for each and every catalog I do not want to receive and communicate with each and every company individually, this process causes me to waste my time. Catalog Choice streamlines the process tremendously. Getting a company to stop sending unwanted catalogs should be a trivial matter rather than a chore. By asking its customers to contact it directly, Pier 1 is in effect making this task a chore.

In my reply to the CSR, I argued all of the above, except for the part about the DMA painting Catalog Choice as the devil because that was unknown to me at that time. The CSR said on Feb 7th that she forwarded my comments to someone who can reverse the decision regarding Catalog Choice but I have not heard anything since. At this point, Pier 1 is off my list of retailers I want to do business with. I’d still very much like to know what precisely their problem with Catalog Choice is because I can’t think of a valid reason to refuse requests put through Catalog Choice.

The Impact of Dead-Tree Magazines on the Environment

Louis-Dominique — Mon, 04 Feb 2008 14:50:09 +0000

Chris Anderson, editor at Wired, posted a blog entry claiming the following:

So by this analysis dead-tree magazines have a smaller net carbon footprint than web media. We cut down trees and put them in the ground. From a climate change perspective, this is a good thing.

I can’t help but read his conclusion and his post as a self-serving rationalization to a) deflect the criticism raised against paper-based publishing and b) keep the status quo in place. In other words, the message is “publishers (and magazines such as Wired) are not doing something environmentally detrimental by relying on print-media.” There are several flaws in his logic. I’m going to concentrate on only a few of them here:

Most of what he puts up is conjecture and a lot of it is based on vague scenarios. Some of the guesses are clearly overoptimistic. It is true that the USPS would not disappear if print magazines did not exist but he sees the impact of print media on the USPS as essentially non-existent: “we print and bind that paper into magazines, which are delivered mostly by the US Postal Service, which runs the same routes whether they’re carrying our magazines or not.” Yes, but print magazines have to be sorted and carried by the mail trucks and mail workers. I can’t believe that if magazines were eliminated the USPS would use exactly the same resources they are using now.
The carbon footprint is not the only environmental impact of print publishing. He focuses on the carbon footprint because he wants to talk about the climactic impact but I think this is misleading. Other forms of pollution must also be taken into account. I doubt that print comes out ahead when the entire environmental impact is considered.
He points out that “trees take carbon out of the air”. But then he associates that benefit with the print industry only. Somehow, cutting down a tree and then planting another one, which is what the forestry companies should ideally do, is better than not cutting down a tree in the first place.
Even if the claim that “print publishing is carbon neutral whereas web publishing is detrimental” were true, the reality is that magazines like Wired and publishers are not currently doing one or the other. They are already doing both. What must be demonstrated is not that print publishing in the abstract is environmentally equal or better than web publishing in the abstract but that engaging in both print publishing and web publishing at the same time is environmentally equal or better than web publishing alone. To take one element of the production line as example, the comparison is not between printing presses on one hand and web servers on the other but between printing presses and web servers on one hand and only web servers on the other.

Then he takes a study of the Royal Institute of Technology, Stockholm as confirmation that his guesses were right. But there are problems here too:

Anderson says:

[The study] compared printed newspapers to people reading those newspapers on the web, and concluded that for the same time reading (30 minutes) the printed newspaper has a lower carbon footprint.

However, he conveniently fails to mention that only in the European scenario was web reading for 30 minutes better than print. The researchers also crunched the numbers for a Swedish scenario and found that print was worse than everything else.
This difference between the European and Swedish scenarios brings to mind a problem with the study. There is no formal discussion of error. It seems to me that whatever estimates the researchers came up with should have had some percentage of error associated with them. There is presently no formal way to know how reliable their numbers are. They do not formally explain how the dependent variables would be affected by variations in independent variables that they used in their study. If they had over or under estimated the energy consumption of web servers by 1%, how would this affect the results? What about all the other variables that are part of this study? This is not insignificant because some models are very susceptible to show large variations in output even for small changes in the input values. In other words, it is possible that if their guesses are a off even by a little, the results could be dramatically different. The difference between the European and Swedish scenarios suggests to me that their model is indeed fragile.
How does this apply to the US situation? Given the difference between the European and Swedish scenarios, I’m not keen of extrapolating the results to the US scenario.

Because publishers are not about to turn back the clock and go print-only, the question for me is “is it environmentally detrimental for a publisher who publishes electronically to maintain its print publishing operations in addition to the electronic operations?” I think the answer is yes. Anderson’s musings do not convince me to think otherwise.

Giving away the content freely is good for business

Louis-Dominique — Sat, 26 Jan 2008 15:37:34 +0000

Well, there you go! Here is proof that Digital Rights Management and attempts to control copies of intellectual property does not help business. Paulo Coelho put online “pirate” copies of his own books and that made sales soar. I’m taking Coelho at his word that there is no other explanation for the increase in sales than the fact that he book available freely on the internet. His sales went from close to nil (1000 copies a year is nothing) to being a bestseller (millions of copies a year!). And these are sales not just copies that people downloaded for free. See the writeup at Torrent Freak for the details. This real world experience completely refutes the received wisdom that to maximize profits, publishers must prevent people from freely copying intellectual works. Not only that but the question which comes to my mind is if Coelho’s sales were so poor initially and he was able to make them soar by offering free copies of his book, then what benefit did he get from working with a publisher? Even, if he did get a benefit from working with a publisher did that benefit outweigh the costs? Because, as we all know, publishers do not provide services for free.

Here we have an instance of the content creator willingly giving away his work for free, so the author is able to give us the real deal about sales figure and how making the work available freely affected them. However, in cases where the work is leaked illegally, the publisher is left to build a narrative as to what happened. Usually, that narrative is based on the bunk notion that all illegal copies are lost sales. So they figure the book has sold X copies and Y copies were downloaded illegally. Then they consider Y to be a net loss. In other words, in a world where free copies are not available the book would have sold X+Y copies but because of copying, it sold only X and so they lost Y in profit. They do not consider that perhaps the situation is more like Coelho’s. Granted, the Y copies were made illegally. But maybe if they had not been made at all, the total sales would be a number much smaller than X. So in a world where free copies are not available, the sales would not have been X+Y but would have been Z where Z is only a small fraction of X. So in the end, without the free copies they would have lost much more than Y.

The story here is that doing away with DRM and lowering the cost of access helps making the work visible. With so many movies, books, games, tv shows available out there, being visible is most important because if people do not know the work exists, they will not even consider buying it. DRM and high prices are the prime obstacles against visibility. It is high time to recognize this.

Kudos to Dell for their recycling efforts

Louis-Dominique — Fri, 14 Dec 2007 18:18:54 +0000

I typically write about Dell to point out what I perceive to be problems with the way they conduct their business. Today, however I want to point out Dell’s involvement with recycling used computers. Ideally, Dell’s involvement should not be needed. There should be easily accessible recycling facilities everywhere and citizens should have enough environmental awareness to take action. My wife and I are lucky to live in a city where there are well advertised recycling facilities that accept computers. Not everyone has such luck and then there are some people who won’t think about recycling until a big name like Dell makes a fuss about it. So kudos to Dell for facilitating the process.