Why Google Will Kill Node Computing


http://internet.seekingalpha.com/article/23709






INTERNET THEMES: E-COMMERCE | E-FINANCE | ADVERTISING | CONTENT |
INFRASTRUCTURE | SEARCH | INTERNET SERVICES | TRAVEL | MOBILE
------------------------------------------------------------------------

Why Google Will Kill Node Computing

Posted on Jan 8th, 2007 with stocks: GOOG, MSFT



Andrew Melcher submits: Twenty years ago, personal computers became the
most advanced human communication system in widespread use. It was a
network of smart desktop computer nodes that were poorly linked by
floppy discs and later Zip drives. Because Microsoft's (MSFT)
operating system controlled the way desktop computers communicated,
everyone needed to use Microsoft products to participate in the state
of the art human communication network.

Microsoft used this network power to: 1) Extract tolls (software
license fees) for using its network, and 2) inhibit other networks from
forming that might threaten Microsoft's network. The user tolls made
Microsoft one of the world's most profitable companies. The
inhibiting of other networks could very well be the #1 deterrent to
computer and communication innovation for more than two decades.

Spamless Network Control
Ten years ago, when the Internet took off, personal computers remained
smart nodes on a hugely improved, but still dumb network. The Internet
made communication between computers instant and easy, but the Internet
alone brought little net increase in network intelligence to the
process of linking computers. Microsoft was essentially unchallenged
from above, and its node network remained in control.

With the Internet circa 1999, you could go to any computer you wanted
instantly, if you just knew where to go in the cacophony of 10 million
websites all simultaneously screaming me-me-me. The Microsoft motto
clearly stated the key question of the time for human communication
technology. "Where do you want to go from here?" The funny thing is
that Microsoft never answered this network control question, Google
(GOOG) did. Now Google controls the most advanced human communication
system in widespread use, the Internet's dominant search engine.

To be fair, in the early years of the Internet, link lists and first
generation search engines did give some degree of network knowledge.
But, recall how until Google, nearly every new direction in Internet
navigation involved drilling down through a list of spammy search
results. This made global Internet navigation a multi-step, slow
process. In other words, before Google, the limited intelligence signal
was largely drowned out by the noise of other nodes screaming for
attention.

Google was first to automate the most basic function of network
intelligence on the Internet: It largely eliminated random network
noise (search engine spam) from the process of navigating the web. It
was also the first to automate the second most basic function of a
network intelligence, that of amplifying quality signals (bringing
quality to the surface).

Google is now the Internet's dominant source of intelligence - its
dominant brain. - a rudimentary and non-conscious brain, but a brain
nonetheless. A brain that suppresses noise and amplifies the quality
signals of its component cells (web sites and web surfers evaluating
those cells). The cells that scream spammy nonsense get suppressed. The
cells that are well-regarded get automatically driven to the top where
they can become global thoughts for anybody that is interested in that
subject. The most popular cells even get rewarded through Adwords and
Adsense dollars.

Order Reigns Supreme
Google now brings more order to human communication more than any other
entity on this planet including Microsoft. And because of that, Google
will increasingly lord over the lower order operating system company
the way the operating system company has lorded over the lower order
software companies.

Soon Google's brain will not want to have information hogging smart
nodes on its network. Google will develop high quality "free"
network software for at least four reasons:




1) Writing software that replaces node software is a cheap way to
generate lots of user hours and congruently lots of ad dollars;
2) The information gathered by people typing words into network
software is great way to gather lots of useful user information;
3) Any information left on information hogging smart nodes weakens the
richness of the information on Google's meta network;
4) The leading node software company is trying to kill Google.

It's hard to imagine a way that Microsoft will harm Google at this
point in time, but the best defense is to make free [ASP] network
software that renders node software financially untenable as an
industry. Some journalists ridicule Google for rolling out embryonic
ASP applications in Beta form. But the ridicule will probably not last
long. Each of these ASP programs will adapt in cycles measured in
weeks, not years as with desktop applications forced to run on Windows
95,98, ME, XP and now Vista, and forced also to be compatible with 1000
other applications. Google's policy of hatching embryonic live young
that will be constantly upgraded by small development team is actually
a very wise way to do things in a network centric environment.

Software In Exchange for Information, Not Dollars
Soon, I suspect that the oxygen will be removed from Microsoft's
environment by Google's higher order technology - a technology that
will give users access to any major type of software application
(better and faster adapting ASP software) for only the price of the
information users enter and the ads they view.

Node technology is already inferior to network computing. In not too
many years, most node computing technology will also be rendered
totally obsolete by the coalescing network computer. People will still
use their node computers, but it will become a popular hobby like
making your own beer, or repairing your own car. Maybe it is time for
the stock market to assign a more accurate risk premium to the node
computing companies given the near certain likelihood of an eventual
meltdown in Nodeville.

GOOG vs. MSFT 1-yr chart:




Disclaimer: Google is the largest position in Melcher's stock
portfolio. The above does not represent an inducement to buy or sell
investments or invest in or sell either Google or Microsoft or any
other company. The above does not constitute investment advice.
Statements about the future are inherently speculative in nature,
because nobody can predict the future.



Free Seeking Alpha Email Alerts

Receive coverage of Google Inc. (GOOG), Microsoft Corp. (MSFT) and
Internet Stocks right to your inbox.

Click to Receive Email Alerts


------------------------------------------------------------------------
Subscribe with a Reader (RSS)

Email this article Print this article

Related:

* More articles by Andrew Melcher
* Read more on the symbols GOOG, MSFT
* Read more on the themes Internet Search

.

Relevant Pages

  • Re: Intel abandons USEnet news
    ... what sort of microprocessor would be best for the Google ... of a relatively smal number of CPU cores, memory controllers, network, ... just the cost of the cheap commodity computers that matters. ... would be more efficient than the network hardware given shared memory ...
    (comp.arch)
  • Re: How to Migrate without running Wizard
    ... You can do it over a network if you have a router. ... Google for crossover cable which will allow you to connect the 2 computers. ...
    (microsoft.public.windowsxp.general)
  • Re: Socket timeout
    ... There are three desktop computers let's call them S, C1 and C2, and I've ... On the firewall of all computers three ports are opened. ... either, to the network stack. ... of Google desktop... ...
    (microsoft.public.windowsxp.network_web)
  • Microsoft Update
    ... they were on a network of computers). ... Basically the issue I am/was having is that IE will not access the network ... could go to my homepage google) did I see that it was related to the new ... windows update. ...
    (microsoft.public.windowsxp.help_and_support)
  • Re: The Hard Problem for Behaviorists
    ... correct low level abstractions to define the operation of the brain with - ... Do you not know how computers work? ... you can think of this type of network like you ... when you drop a marble in hole X1, ...
    (sci.cognitive)