Science Funding Fix Obscures ICT Opportunity

It has taken almost a year, but the government is finally addressing the mechanisms and priorities around the funding of research, science and technology in New Zealand.

The government’s policy approach to funding science research hinges on maximising the economic and social benefits, building international linkages whilst protecting the natural environment. Better utilising the “scientific value chain” seems to be the chief driver behind the funding shake-up. Science leaders have long complained that they spend too much time doing paperwork and competing for funding, when their time is better spent doing actual science.

The draft policy document indicates that sectorial funding priorities will largely be governed by the interests of existing Crown Research Institutes (CRIs). That is not a bad thing, but it underlines what we have suspected for quite some time – ICT is no longer seen as a primary driver of value-added economic growth, despite its obvious importance as an enabler.

ICT is now bundled within “high technology industries”, although it is not clear what proportion of this funding will be dedicated to information technology. In fact “transformational manufacturing” seems rather to be the focus for this area. It seems odd that the government would allocate $1.5 billion to a broadband rollout without a simultaneous commitment to strengthening ICT research and commercialisation in order to capitalise on the opportunity.

You can read about and make submissions on the proposed policy here.

Cow-shit and Candyfloss Overcomes High Tech

In an interview for Unlimited Magazine, physicist and technology entrepreneur Paul Callaghan recounts meeting Prime Minister John Key at a business function. The PM had just stepped off the speaker’s podium where he had been talking up agriculture and tourism and expressing scepticism about the value of New Zealand’s technology sector to the economy. If that is the kind of leadership we are faced with, then I fear that the devaluation of our economic potential will continue unabated.

And before I’m accused over being overly harsh, let’s just look at this government’s track record since taking office well over six months ago:

  • Research & development tax credit reduced then cut altogether.
  • Fast Forward programme wiped and replaced with identical project with less funding.
  • I.T. worker redundancies from government agencies.
  • Negligible budget increase to RS&T vote.
  • Major cuts to tertiary education funding.
  • NZ Innovation Centre loses $15M in funding.
  • Reported $100M net loss to market development assistance programmes for exporters.

To be fair, we all knew that the Budget needed to be tough – even if Key and English can’t agree exactly why. Certainly borrowing to fund superannuation and tax cuts doesn’t make good fiscal sense; but neither does knee-capping your research, science and technology capability. To its credit, the government did provide additional resources to the Marsden Fund and a one-off operational grant to REANNZ the high speed research network. In the latter case, they obviously could not be seen to allow the research network to fail, whilst at the same time pouring billions into digging trenches for a brand new domestic network for which a proper economic business case has yet to be made.

Investing in and commercialising research will never be cheaper than today and you can be sure that our competitors in America and Europe are continuing to do it. I’ve said it before – when I look around town, it is the businesses that have invested in developing new technology that are still growing. It seems like the government is signalling it wishes to play less of a role in this arena. Dairy commodity prices are dropping again, so too are visitor numbers. The PM’s support for agriculture and tourism is no doubt uplifting for the cow-shit and candyfloss brigades, but it does little to bolster our GDP per capita output in the long term.

Wool to Weta by Paul Callaghan is available at all good bookstores and explains why research, science and technology is important to the New Zealand economy and why a unified vision is needed.

Merry Twitt-Mass

I’ve been resisting this for some time, but finally succumbed and opened an account at Twitter. And since Twitter now appear to have identified how they will make money, it’s clear that the increasingly popular micro-blogging service is here to stay.

Described alternately as “narcissistic and self indulgent” or (predictably) “the next killer app”, Twitter is like most things in life, there are pros and cons. If used judiciously it can be beneficial. It delivers me links to useful news and articles and it opens up another channel for me to share ideas. According to this explanatory webcast by O’Reilly Media, it’s also a “mood meter” for whatever is going in your sphere of interest. On the other hand, I don’t have any control over what I receive, once I subscribe to another user. So there are the vexing questions of truth and relevance. Do I really need all that additional information about somebody elses lifestream and how much of it is real anyway?!

But the really interesting part about Twitter is that it has the power to aggregate a huge global community. At present Twitterdom is largely confined to geeks, technophiles and early adopters. But that’s exactly what you’d expect at this point in its evolution. I think that will change. What will make the difference is when other communities realise that Twitter can work for them too. For example, there are lots of third world countries where Internet access is poor but mobile phone access is ubiquitous. So what better way to keep in touch with friends and family, when back-packing, than by micro-blogging via your mobile. Maybe even criminal dictators like Mugabe will be unseated by Twitter campaigns in the future?

But what really sold me on joining up was two things. Firstly a friend introduced me to TwitterEarth where you can spot tweets from all over the globe. OK so it’s a wee bit gimmicky, but it demonstrates how interesting new opportunities will spring up from the paradigm shift towards micro-blogging. Secondly I read a great article about how to use Twitter as a marketing tool. Suddenly I could see some value in it for me. It also occurred to me that Twitter is a great case study for the kind of mental transition our business will need to think about engendering as we push our own technology projects out into the global marketplace, such as our recently released site iWantMyName.

Looking forward to some “tasty Tweets” from you all over the Festive Season. And by the way, I promise not to squawk more than once or twice a day.

Digital IP Strategy Needs More User Input Less Govt.

Last week I spent a day at the inaugural Digital Development Forum meeting, along with about 150 plus other well-meaning representatives of stakeholder organisations from the New Zealand ICT sector. One of the messages to emerge out of this meeting was that a lot of people are concerned about where the new copyright legislation is heading.

Almost everyone agrees that we urgently need to address the existing law, because it is woefully inadequate given the rapid changes in technology that are occurring. In fact the whole issue of intellectual property protection is receiving attention globally for this very reason. The current system doesn’t really work that well anymore, given the rapid rate of ICT innovation.

But the chief complaint with the New Zealand legislative changes seems to be that there is an imposition upon ISPs to police Internet use and to deactivate recalcitrant abusers and that the government has not listened to industry concerns. That is ironic because Digital Development NZ projects itself as being the industry mouthpiece in the ear of a government that is committed to listening to the industry.

So in a (rare) demonstration of unity the industry has asked that implementation of the legislation be delayed pending further input. But since the amendment to the Copyright Act Bill was actually passed months ago, one has to wonder whether or not these concerns were raised when the legislation was at Select Committee stage over a year ago. Or was the ISP policing clause inserted discretely afterwards?

In any event, the copyright legislation (and the DDNZ Forum) are unlikely to have any affect at all on teenagers and other so called “digital natives” whose lifestyles revolve around ripping off and re-mashing creative content from a variety of sources. Last week’s forum meeting was an invitation only event dominated by middle-aged public servants and well paid industry lobbyists in nice suits and comfortable shoes.


e-Day Approaching

Perhaps the most useful outcome of my day at the forum was that I met Lawrence Zwimpfer, who is organising the nationwide e-Day event to be held on Saturday the 4th of October. e-Day is a great initiative that provides a free disposal and recycling service for owners of old or unused computer and cell phone gear. So there is no excuse for biffing all that obsolescent junk in the landfill.

They could really use some more volunteers to help out on the day in over 30 venues around New Zealand too! You can sign up here.

Maori Lexicon Spins Off Pod of Projects

orcaEnglish has prevailed as both the accepted language of commerce and as a dominant language on the Internet.  But vast numbers of non-English speaking web users are demanding that the Internet become truly internationalised. That presents an opportunity for innovators able to span cultural divides with enabling technologies.

 My mate Dave Moskowitz always has a few interesting web based projects on the boil whenever we chat. So I was pleased to hear that the online Maori dictionary  for speakers of Te Reo has finally come to fruition after much hard work. The project also complements the excellent English-Maori online dictionary and language resource kete provided by Te Whanake.

Significantly, the collaborative open source tool set used to develop the lexicography is now to be deployed in other settings globally. Apart from projects involving translation of Hawaiian and Burmese Karen into English there is an intriguing local project involving research and preservation of Maori legal documents dating from the 19th Century. No doubt there will be a steady stream of enquiries once word circulates about this unique platform. The timing could not have been better, with the recent launch of the Maori version of Google.

As the Internet becomes more and more pervasive, there is a risk of imposing a dull monoculture on its users, particularly on indigenous peoples. And with the increasing affluence of non-English speaking regions such as the Middle East and Asia, the demand for translation tools and non-English web content must surely grow exponentially. Platforms developed in multicultural New Zealand are well positioned to take advantage of this growth and to encourage diversity on the Web.


Entrepreneur’s Epilogue

It was a defining moment last week when ideegeo took up residency and became a foundation member at Altspace in downtown Wellington. Not a moment too soon. There has been a surge of progress, with our European partner company suddenly in a position to provide a steady stream of consultancy work. More importantly my CTO and his long-suffering (but very understanding) lady were getting heartily sick of us running the business out of their spare bedroom.

Altspace is a shared workspace for start-up companies and independent contractors, providing a communal office site complete with power, Internet and furnishings plus access to a kitchenette and toilets. Being centrally located it is handy for both casual day trippers and long term users who need a base for business. Altspace director Steven Heath will be on hand at the Geeks, Games and Gadgets ’08 expo to talk about the venue which he also hopes to make available to local I.T. user groups.

I will miss the view out the bedroom window however. On our first day of working together there was a pod of Orca playing in the shallows of the South Coast right below us. I took that as a good omen.

Can Business Get Its Head Around Social Media?

Developer meeting held in SmallworldsFrom virtual worlds to dating sites to online gaming, there’s no denying that people are spending more time than ever before engaged in digital social media of some form or other. It comes as no surprise then to learn that, in the first half of 2008 alone, venture capital firms invested US $345 million in virtual worlds or related enterprises. As more sophisticated business models emerge around virtual economies, it has become clear that there is now real money to be made online.

In a world where travel costs are spiralling ever upwards, more and more people are opting to stay at home for entertainment. Does it mean that shopping malls, movie theatres and public bars are sunset industries, to be replaced by bits and bytes residing on a remote server? Perhaps not just yet, but rarely a day goes by that we don’t hear about the launch of a new web community, social mash-up or cool online game of some sort. 

Unfortunately research suggests that about 75% of these communities will never even achieve 1000 users. We set up ION almost six years ago and only recently celebrated our millenial sign-up. In any event there must be a limit to the proliferation of online social networks because once users become uber connected there is far less incentive to keep signing up to new networks. As network density increases, the advantage gained by the user decreases.

So when even Bill Gates gives up on his Facebook account, it really makes you question how much value large corporates see in social networks and virtual worlds. Some people continue to question whether or not virtual spaces will ever become meaningful in an enterprise setting. Although businesses have been using applications such as Sharepoint and Lotus Notes as knowledge management tools for years, corporates are still struggling to make the quantum leap into virtual communities and interactive game type environments as forms of collaborative business tools.

On the other hand corporate dinosaurs are belatedly waking up to the power of social media as a marketing tool. This videocast from the Harvard Business School offers advice to large companies about managing the change processes around implementing social media strategies. Now – I’m pretty sure I don’t need to belong to a web community for kitty litter or some other weird or random social network. I would however join a business network or film club that had an online community component for example. Whatever spins your wheels, I suppose.

New Zealand has a couple of promising virtual world ventures of its own. Smallworlds launched recently with a high quality browser based world for young adults that leverages advances in Flash based functionality and graphics. Socialise was an early entrant with a dating and friendship focus. Socialise is a regional community that has secured advertising sponsorship as a revenue stream, whilst Smallworlds is pitched at a global audience and intends to establish a virtual economy within the site.

Smallworlds users create and populate their own individual home spaces, which raises the question of identity portability. If players participate in several communities, plus own a Facebook or MySpace page, how can they manage their global identity? For dedicated social networkers with multiple sites to share and manage, aggregating all those links at one web address would seem to make sense. That’s a problem that we hope to address in a creative way very soon at ideegeo.

UPstarts Enliven Capital ICT Scene

Unlimited PotentialAfter a period of quiescence, Wellington’s technology and business networking event scene is now undergoing somewhat of a renaissance.

On Thursday evening this week Unlimited Potential are throwing a launch party for Start-Up magazine and Silicon Welly whilst throughout July and August 7X7 are offering a thought provoking weekly think-fest on “economic transformation”. But wait there’s more!

Also in the pipeline @UP is the annual Geeks, Games and Gadgets technology showcase in August, Software Freedom Day in September for Open Sourcers, and a possible Town and Gown collaboration with Victoria University ICT researchers. With UP taking over managing the ICT Capital membership base it brings this collective community to over 1500 ICT sector professionals, business owners and technology managers.

After the wild successes of XMediaLab and  Webstock it is clear that Wellington is now emerging as a “go to” destination for technology and innovation related events in New Zealand. People are talking more and more about the value of community. Sponsors, opinion-makers and governmental agencies are now realising there is tremendous value in leveraging the interest groups that grow up around such events and Unlimited Potential is rapidly positioning as the event manager of choice for this sector.

In 2002 when GeniusNet set up the first virtual community for innovators and entrepreneurs, we did not have the resources to run live events as well. Back then, people struggled with the concept and of course the term “social network” was not widely in use in a web context. But our research found that the best ideas arise from the creativity found where community boundaries overlap. You can’t build a collaborative community by email, webforum or teleconference alone however. Trust is the bandwidth for the exchange of knowledge and one generally needs to meet people face-to-face to build that trust.

Virtual communities and social networking platforms do facilitate engagement to a certain extent, but real live meetings build much deeper foundations of trust. Jobs are located, deals transacted and relationships forged ultimately because people met together in person, eyeballed each other and learned trust. I know  this for a fact, because right now I’m developing a very cool business with some smart guys I originally met online. How Web 2.0 is that?!

Why ICT Underpins Innovation

GITRA recent global report on information technology places New Zealand about the middle of the pack in terms of “network readiness”. But the index only accounts for part of the story about why the country is struggling to remain competitive through innovation.

The information technology report from INSEAD university and the World Economic Forum offers some very clear indications around what New Zealand has to achieve in order to boost innovation and raise competitiveness. The annual report ranks all countries in terms of ICT readiness by assessing a basket of factors that influence business, government and individuals. Quality of phone, broadband and server infrastructure, regulatory environment, quality of science education, R&D spend by firms and availability of venture capital are amongst the variables assessed to establish a “network readiness index” (NRI).

High network readiness alone does not guarantee success however. In fact highly competitive nations such as Finland, Israel and Taiwan rank slightly below New Zealand on the network readiness index. But if we consider a bunch of other factors that allude to innovative capacity, it paints a much different picture. Innovation factors (IF) include quality of scientific institutions, extent of university-industry collaboration, availability of scientists and engineers, number of patents issued per capita. These factors tell us whether or not a nation has the capacity to innovate through novel research, which is a far stronger value proposition than simple imitation. The fact that New Zealand ranks about the same as Zimbabwe is probably reason for some concern.

What we do know is that countries which rank highly on both counts, tend to be innovation powerhouses with rapidly improving GDP per capita. By this we mean nations such as Denmark, South Korea, India, Singapore and Malaysia. Unsurprisingly, all of these countries embarked some time ago on aggressive improvements to their ICT infrastructure. So exactly why does ICT appear to underpin innovation?

There are at least five good reasons why a sound ICT environment supports innovation processes:

  • Knowledge identification eg. market research, locating human resources, accessing science research, knowledge sharing platforms.
  • Developing creative capacity eg. computer aided design and 3D graphics.
  • Enhancing exploration eg. simulation and prototyping.
  • Shortening the design-test cycle eg. making failure inexpensive.
  • Improving capacity for commercialisation management eg. knowledge management, Web 2.0 e-marketing, virtual collaboration.
  • Empowering customer feedback into the design process.

The human genome project is a good example of a piece of innovation work that, a decade ago, could not have even been imagined anywhere in the world. Could such a project be done in New Zealand today? Although we now have a high speed research network and at least one homegrown firm offering suitable enabling software technology, it hasn’t happened because we are still struggling with a number of the innovation factors mentioned above. R&D spend is low, collaboration seems problematic rather the accepted norm and the education system is failing to inspire a new generation of scientists and engineers.

This shows that, as an enabler of innovation, we cannot consider ICT in isolation. There has been much debate over the need to rollout better broadband across New Zealand. But the economic case for substantial publicly funded investment in the project has yet to be properly made. Most people grasp that more and better ICT would be a good thing, but few are clear on exactly why. We need to benchmark ourselves more fully in order to better articulate the need.

X|Media|Lab Delivers Quality ConneXions

xmlHeld last month at Te Papa, X|Media|Lab proved that we can all be global influencers for digital innovation. Not only that, but by utilising knowledge networks, we can leverage the creativity that already exists in our own back yard to help build successful global businesses. Some quick notes from the conference day:

The speaker session opened by addressing the concept of “ideation” – finding good ideas. Former Sony Entertainment president Chris Deering focussed the audience’s attention with the observation that online entertainment services would likely overtake revenues from TV and cable in the very near future. With MySpace (reportedly) approaching already 100 million sign-ups and phone handset sales ballooning he also predicted a future market for mobile communities in the vicinity of 400 to 800 million users by 2012. With numbers like that it was easy to see where the smart money was headed he said.

sachinIn a room full of game developers and creators of virtual worlds, those remarks really set the tone for the day. Continuing the theme, Virgin Comics and Animation CEO, Bangalore based Suresh Seetharaman, noted that in India alone there were 550 million under 20 year olds and that the mobile phone has become far more ubiquitous than the computer. He explained that his business was developing new creative streams, starting with fantasy comics because many of the largest grossing feature films have sprung out of comic book stories. Virgin Comics are creating a new pop culture by drawing on both mythology and modern media. A curious example of this is their Sachin Tindulkar super cricket hero storyline.

Local lad made good Richard MacManus prophesised on technology trends, later posting the presentation on his  highly rated Read Write Web blog. Moves towards the “intelligent web” were to the fore in his discussion as was the ongoing battle of Google versus Facebook. Keynote speaker Noah Falstein then spoke about the essentials of brainstorming and how to promote ideas instead of egos. Afterwards he went on National Radio and took part in a panel discussion about the future of online gaming.

Tom Duterme enthused about new venture development and the importance of establishing a good team behind the product. As Google’s talent scout for purchasing new businesses, I noticed he was much sought after during the intervals. Gao Li lead a team from the controversial but now profitable Suzhou Science Park (near Shanghai) and shared with us the staggering scale of China’s investment in research, science and technology. In her home province alone there is a $US 2 billion VC fund and some 3.8% of regional GDP is reinvested back into RS&T, putting New Zealand thoroughly to shame.

AlvinAlvin Wang Graylin expanded on the China story by mentioning that there are already nearly 600 million mobile phone users but with SMS being the predominant use, he cautioned that revenue per user remains low. In an effort to grow this market his company sets up mobile phone marketing services. He suggested that whilst carriers were keen on securing new revenue streams, this was limited by network capability for the time being.

Perhaps the speaker I enjoyed most was Hugh Mason from the U.K., a politely spoken and knowledgeable investor and entrepreneur in the creative sector. He had a very simple mantra for creating value with a winning start-up business team. “You need a finder, a minder and a grinder” on your team he said and try to have your product solve a problem that makes the world a better place. I took some comfort in the fact that we have formed our latest venture around just such a model.

I also enjoyed the networking session kindly hosted by Park Road Post the evening before but I found myself asking, as a “veteran” of the Wellington technology business networking scene, why was it the first time I had set foot in those hallowed halls. X|Media|Lab stands for cross-media connection. Why then do we hear so infrequently from our friends in Miramar? How about we run a local XMedia event each year and challenge film, software and graphics entrepreneurs to bounce new ideas around together.

According to Tim Berners-Lee, the new imperative for the Web is now creative connectivity. But as one of the XMediaLab speakers mentioned, “I do business with people that I like – but I first need to get to know them in person to like them”. Creativity and good ideas arise from the interstices between communities and hence it is very important to overlap from time to time. I feel that lately we have not been achieving this often enough. New Zealand Trade & Enterprise are to be congratulated for supporting this event and let’s hope there will be others in the future. In the meantime local networks like Unlimited Potential and ION will continue to add value by building social capital and sharing knowledge amongst the technology sector community.

Grid Network to Support Trans-Tasman Research Collaboration

With digital storage needs and computational demands by research institutions growing exponentially, it makes sense to get together on sharing resources. So the New Zealand Tertiary Education Commission (TEC) banged some heads together and offered to fund a $2.5 million project to set up BeSTGRID a grid computing “ecosystem” that includes additional storage resources hosted by a third party.

Three New Zealand universities are already hooked up, with the new arrangements which reduce duplication on software expenditure whilst encouraging collaboration and knowledge sharing through use of online tools such as video-conferencing, blogs and wikis. Other institutions are expected to join in the future. Research projects currently making use of BestGrid include linguistics, bio-informatics and earthquake engineering, but the possibilities are endless. BestGRID is part of KAREN the government owned high speed broadband network. The network provides interconnectivity between research and educational institutions in New Zealand, with the ability to deliver up to 10 gigabytes of data per second.

Perhaps the most interesting aspect of the venture is that there will be established a shared identity management protocol based on the Australian Access Federation standard. The Federation is not some inter-galactic peace force, but a technical standard that operates across Australian tertiary and research institutions and allows universal access via a single user identification. That opens up the possibility of including Aussie universities and research institutions in the New Zealand grid by linking to Australia’s own high speed research network AARNET at some point in the near future. AARNET already operates connections to the United States, Singapore and Europe. So the implications for New Zealand research institutions are obvious considering the constraints of the existing commercial service.

New Zealand will be hosting the 2008 APAN event 4-8 August, regarded as the leading Asia-Pacific symposium on advanced broadband networking and applications for research and education. The conference is to be hosted in beautiful Queenstown and themes include sustainability, earth science, medical and agricultural applications, high definition TV and seminars on network security. The event will be preceded by the High Performance Research Symposium looking at e-research projects and tool sets, being sponsored by Bluefern, the University of Canterbury supercomputing centre.