Google Revolutionizing Ad Game

David Kirkpatrick’s insightful article on Fortune describes Google’s AdSense business model as one in which advertisers only pay for success.

Most advertisers seek to stimulate demand by reaching a certain group of people with their message. In order to do so, they figure out which demographic segments are likely to respond to their messages and craft the ads accordingly. Google throws this model out the door. For Google, the key to an ad’s success is not reaching the right demographic, but understanding the attributes of the product itself. When you can properly identify those attributes, you can buy links to keywords that describe or relate to them. The “demographic” is self-selecting. Anyone who seeks information about those subjects will see that ad. If it appeals to their interest, they click on it, see a message on the advertiser’s website, and Google gets paid.

Gates and RMS agree on this

In the Programmers at Work panel at CMP’s Software Development Conference and Expo, Dan Bricklin read out this passage from Susan Lammers’ interview with Bill Gates.

The really great programs I’ve written have all been ones that I have thought about for a huge amount of time before I ever wrote them. I wrote at BASIC interpreter for a minicomputer in high school. I made massive mistakes in that program, and then I got to look at some other BASIC interpreters. So by the time I sat down to do Microsoft BASIC in 1975, it wasn’t a question of whether I could write the program, but rather a question of whether I could squeeze it into 4K and make it super fast….

…One of the most fun programming experiences I ever had was when we were doing BASIC. I had done the 8080 BASIC, and then I had about two weeks allocated to work with Mark Chamberlain on the 6809 version of BASIC. I read the instruction set at the start of the two weeks, and I wrote about three or four programs. And I looked at some other programs to see how people used the instruction set. It was great fun to take a problem I understood and map it onto this new instruction set, and see how tightly we could put the thing together…

…I really get satisfaction from somebody else on the team becoming a great programmer. Not quite as much as I do from writing the program myself, but that is a really positive event. The way I make someone else a great programmer is to sit and talk with him a lot, and I show him my code. In a team project, you make the code everybody’s code…

Interviewer: Is studying computer science the best way to prepare to be a programmer?

Gates: No, the best way to prepare is to write programs, and to study great programs that other people have written. In my case, I went to the garbage cans at the Computer Science Center and I fished out listings of their operating systems.

You’ve got to be willing to read other people’s code, and then write your own, then have other people review your code. You’ve got to want to be in this incredible feedback loop where you get the world-class people to tell you what you’re doing wrong…

Indeed, this is where both Bill Gates and Richard Stallman agree.

Business in China

The Economist writes in a survey:

This survey will cut through some of the hyperbole currently enveloping China. Progress there is as real as it is dramatic, but the country is still in transition from one political and economic system to another. The constraints imposed by the communist leaders (not least on themselves) have produced a darker reality behind the impressive statistics and soaring skylines, in the words of Orville Schell, a professor at Berkeley who knows the country well.

China needs 12m-15m new jobs every year just to keep pace with its population growth. It has to provide opportunities for the 800m people living in rural areas who have been left behind by the current boom, and a third of whom are under- or unemployed. It also has to deal with the 100m-150m migrant workers in the cities who have no job security, no long-term housing and no health care. And it needs a functioning pension system. No wonder the government is concerned, above all, with growth and job creation.

Currently there are worries that the economy is overheating. Bubbles are beginning to form in property, steel and cars, and power generation is running up against capacity constraints. China’s real problem, however, is not inflation but overinvestment. In its quest for growth, the government has directed its state-owned banks to open the taps. Easy credit is producing massive overcapacity, leading to deflation, more bad debts and fewer new jobs. Already, nine-tenths of manufactured goods are in oversupply, yet investment in fixed assets last year grew by 30% and contributed 47% of GDP. Three-quarters of China’s growth comes from capital accumulation, according to Paul Heytens and Harm Zebregs of the IMF, yet total factor productivitya measure of overall economic efficiencyrose by only 2% a year in 1995-99.