Tag Archives: economics

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Google as energy trader

All the media fuss and furore over the Nexus 1 phone from Google has (whether deliberately or not) diverted attention from a more interesting development from everybody’s favourite nominal monopoly: they’ve started a new subsidiary company and applied to the FTC for Google Energy to become an energy trader, able to buy and sell energy in the wholesale supplier-level markets.

This isn’t Google’s first foray into the energy business, and it’s not exactly surprising that a company which depends on electricity to keep its services up and running should be looking at ways of cutting costs – not to mention potentially selling back their own excess production onto the grid, should they find themselves with watts to spare. The Big G claims that it has no interest in becoming the next Enron, however; their broker status would enable them to pick and choose from renewable energy sources rather than the fossil-based stuff that most regular businesses have to buy, and that’s their main motivation. [all links via SlashDot]

Even so, one can’t help but think that the energy market is going to become very competitive and dynamic in the next few decades, and that having one’s toe in the door from the outset would be a sensible move for a company with long vision…

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North Dakota vs Minnesota: interstate economic warfare

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To a nominal Brit like myself, reading about the American governmental system is a constant stream of surprises. It’s one thing to understand that a country comprised of fifty-odd states (which are themselves the size of some sovereign countries) will have baked a certain degree of local independence into its legislature, but entirely another to read about the ways that such an arrangement can manifest itself. Case in point: North Dakota is suing Minnesota over its newly-introduced carbon taxation laws, which (so North Dakota claims) “unfairly discourage coal-powered electricity sales in favor of renewably powered electricity”. [via BoingBoing]

I’m seeing this legislation described as the first real-world example of a carbon tariff, which suggests that such measures are going to have a rocky reception when they become more widespread… but that was a given, I suppose. What’s rreally interesting as an outsider is the way this case highlights the increasingly fragmentary nature of the United States; I have no idea how it looks from within, but from this side of the pond, some form of religio-econo-political schism splitting the US into geographically-defined factions (remember the Jesusland map?) doesn’t seem like a massive leap of the imagination.

But that’s massively uninformed armchair punditry on my part, so it’s over to Futurismic‘s American readership: to a citizen of the United States, does it feel like the Union is becoming increasingly strained by hyperpolarised political ideologies and economic difficulties? Or are we just seeing something that has always been there? (Feel free to sound off on political issues, but keep it friendly, please.)

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US$330,000 for a virtual space station?

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For the vast majority of readers here, I expect virtual economies consume very little of your meatspace money, if any at all. But some folk place a huge real-money value on intangible virtual items… via Cheryl Morgan comes news of a guy who just spuffed US$330,000 on a virtual space station in the Entropia Universe MMO:

Entropia Universe is well known for its “real cash economy,” where $1 can buy you 10 PEDs (Project Entropia dollars) in the virtual world. The Crystal Palace is a huge virtual space station that orbits the Planet Calypso.

Well the auction just ended, and one “lucky” man (Buzz “Erik” Lightyear) has just won the Crystal Palace for 3,300,000 PED. If you haven’t figured it already, that translates to $330,000 USD.

[…] the purchase may be strategic — the owner stands to make money off the shops, transactions, and activities that occur on his virtual space station. And if online gaming and virtual currency continue their growth trends in 2010, the man could potentially make his money back.

As pointed out, a purchase of that size currently screams “rich guy with money to waste on having fun”(which I can’t bring myself to begrudge entirely), especially if you look at the video clips of the space station’s interior (which looks a lot like a custom level for the Doom engine, IMHO).

But virtual economies and entirely intangible businesses haven’t gone away, despite the headlines dying off periodically… I fully expect we’ll see more of this in the year to come.

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The legislation of fabrication – should 3D printing be outlawed?

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Here’s another sf-nal thought experiment to keep your brain occupied. We frequently mention 3D printing and fabbing here at Futurismic, but usually in the context of its positive disruptive potential – a potential sea-change in capitalist economic systems, for example. But here’s a negative response from analyst Nick Jones of the Gartner corporation [via Fabbaloo]:

… do we really want an affordable domestic fabber? Fabbers will likely “print” objects using some form of plastic. So the inevitable consequence of mass market fabbing will be a huge increase in the amount of non-biodegradable plastic waste clogging up the planet for hundreds of years into the future. Should we maybe ban fabbers before the problem arises? Like most problems there are solutions, like biodegradable plastic. But if we wait until all the problems with a technology are solved before we permit it, then we will waste a decade or two of potential value; and in any case there’s no way we can predict all the social and environmental issues associated with a new technology before it arrives.

I’d agree with Jones’ last point – social disruption patterns, particularly, are very hard to predict accurately (which is probably part of the reason they’re perversely fun to discuss), and it’d be a shame to lose out on the potential power of fabbing to transform the life cycle of many of the things we use on a daily basis.

But there will be plenty of people who will see fabbing as a threat, environmental or otherwise, and who will push for legislation to control or suppress it. A victorious climate lobby would certainly flex its muscle against a technology that promised to democratise mass manufacture, as would those corporations whose bottom lines would vanish overnight – not just delivery firms like FedEx, but the factories in developing nations that churn out tchotchkes and basic hardware at low-low prices. It will be interesting to see how the traditional left-right political binary will fall across this issue; I suspect it might not be in the direction most easily assumed.

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Somalian pirate ‘stock exchange’

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piratesThe Somalian tanker pirates are back in the news – apparently they’ve set up a sort of ‘stock exchange’ to handle the influx of business and investment opportunities and feed their ransom money back into the local area [via BoingBoing; image by bazylek100]

The gangs have made tens of millions of dollars from ransoms and a deployment by foreign navies in the area has only appeared to drive the attackers to hunt further from shore.

It is a lucrative business that has drawn financiers from the Somali diaspora and other nations — and now the gangs in Haradheere have set up an exchange to manage their investments.

One wealthy former pirate named Mohammed took Reuters around the small facility and said it had proved to be an important way for the pirates to win support from the local community for their operations, despite the dangers involved.

“Four months ago, during the monsoon rains, we decided to set up this stock exchange. We started with 15 ‘maritime companies’ and now we are hosting 72. Ten of them have so far been successful at hijacking,” Mohammed said.

First point I’d make is that this reads much like a press release – as if the Reuters guy went down, got a few quotes from the people involved (who were only too keen to put a gloss of success on the operation for the international media) and filed the copy. This is a story about bad guys, so if the bad guys want to appear like they’re really bad, why not quote ’em verbatim? I doubt things are running quite as smoothly as they’d like us to believe.

That said, the core of the story is eminently believable… and if the stuff I read in my old job as an employee of the Royal Naval Museum is to be believed, there’s considerable historical precedent. The buccaneers of the Caribbean had thriving dependent communities and investment programs, and operated with a similar degree of impunity at the peak of their powers, as did the Barbary corsairs. As the nation-state model of political power decays, I suspect we’re going to see more interstitial criminal communities arising to skim the cream from international trade – those tens of millions of dollars that the pirates are raking in aren’t comparable to the higher cost of sending navies out to stop them. Which in turn leaves the door open for the rise of mercenary navies to take on the work of protection…