Translation

Inventors are important. Without inventors, we would not
know what time of the day it was. (Apart from Paul Hogan.)

Visionaries are important too, without visionary explorers
like Vasco de Gama and Captain James Cook, we would not be sitting on this huge
rock called Australia
– we would still be huddled around the fire in old England
thinking there be beasts at the extremities of the maps.

 

The explorers ignored mother church. They believed Galileo
about the world being round.

 

Entrepreneurs are the
visionaries that are unafraid to have a go. Not for them the safety of a
Government 9-5 job with an annuity at the end. They bet their whole lives on a
vision and then attack that vision with a passion that is not adequately
regarded or rewarded in the land of the Tall Poppy syndrome (Australia).

 

The popular belief is that we owe our current life-style to
our credit cards.

After all, isn’t everything now purchased on Credit?

 

Unfortunately, yes it is.

 

Yet credit equals interest payments and interest payments
equal the ability to generate money today based on tomorrows guaranteed
interest income.

 

Government works the same way, but on a slightly larger
scale.

 

If, the average income per annum is $44,000 and the average
work life period of an individual is fifty years, then the taxes on $44,000
(with no indexation – this is a story, not a paper) over 50 years equals
$594,000. The actual calculation is a little more complex, but I am simplifying
the calculation for the purposes of brevity.

 

So if the average human is worth $594,000 (NPV net present
value) and the population is 20,000,000 with 62% of the population employed (these
numbers are not correct for Australia, I just don’t wish to embarrass anyone by
printing the real numbers;) then we have a guaranteed FV of $7,128,000,000,000 as our budget for the next
fifty years; (not including such niceties as discount rates etc).

 

Next year of course,
(IF) the population were growing at 20,000 per day, we would have an additional
$4,336,200,000,000 that we can use – or borrow against the future tax revenue.

 

And all of this
without indexation or CPI.

 

WOW! Can I buy a
country please….. this is fun.  How many
BMW’s can I buy with .. how many zeroes were on the end of that number?

 

Unfortunately, if we
drill down to the figures, this year – in reality the Australian Government
have exactly $142,560,000,000 coming to them from personal income tax. Where
does the shortfall come from. Probably from the large companies huh?

 

Well, actually, no.
They hire big accounting firms to re-write their tax liability. Downwards.

 

For example Telstra.
Last year – they contributed only 1/800^th of the tax required to
balance the books of Australian fiscal budgeting. (paid
$1.7 billion in Commonwealth, state and local taxes)  

 

For the largest
monopoly enterprise in Australia to fail so dismally at supporting the
Australian battler – after gouging him/her (the Aussie consumer) at every level
of communications and entertainment  –
should be criminal.

 

So, since big
industry has failed at funding the Australian lifestyle, I’m afraid it’s up to
you and I.  Errr, I just thought about my
taxation situation…… so, actually the foreign debt is probably on your
shoulders.

 

But what about all that money we make from exporting all the
iron ore and copper and gold and silver and coal and stuff?

 

Well that is spent on iPods and Computers and Mercedes and
BMW’s.

 

Surely there must be something we can do to balance the
books……

 

Yep – invent something. It doesn’t matter what it is –
invent it and then sell it – preferably overseas.

 

OK so how do I sell something overseas?

 

You hire a salesman. The salesman creates a market for your
product.

 

So if I invented a really neat widget, that did widget stuff
better than anyone else – how would the salesman know how to sell it.

 

AHHA! Now we come to the nub of this article.

The difference between a ho-hum country, a ho-hum company
and a ho-hum invention is the vision and the ability to successfully
commercialise that vision.

 

It doesn’t matter if the mousetrap is a better mousetrap or
not. (OK – it helps a little bit.)

Everyone thinks that that the iPod was invented by Apple –
WRONG.

The iPod was invented by Kane Kramer in 1979. However the
iPod was empowered by Steve Jobs who saw it as a way of separating the content
industry from their physical distribution model. i.e.: Disruption. Any VC will
tell you – Yeah – it’s a great invention – beautiful colour – we like it…… but
WHO does it disrupt?

If it doesn’t disrupt anyone, then it probably won’t make
anyone a shit-load of money.

 

Think about inventions over the last few millienia. Is there
a single invention that didn’t disrupt someone ?

 

Gas (for street lighting) disrupted the whale-oil industry
and the candlestick making business.

Electricity disrupted the Gas lighting business.

Solar and wind power (via hydrogen cracking) is starting to
disrupt the Coal business.

Motor Vehicles – Horse farms, carriage builders

 

OK – so you have an invention. What next?

 

Find a geometrically challenged thinker (someone who thinks
a square looks like this – П)  with a
vision of what to do with your invention and make money while he ensures that
your invention will disrupt someone.

 

Who?

 

Well that’s the point. There’s no use targeting the small
candlestick maker down the street. After all, her one sales outlet is the local
markets.  Disrupting her will only net a
couple of measly bucks a week.  Yes, it’s
all yours….. yes you own 95% of the equity in all the takings.

 

Gee, a whole thirty bucks a week.

 

Weren’t you saying something about forward interest payments
and Net Present Value of those payments? Couldn’t we do something like that
about my burn all day solar powered candle?

 

Well yes, but a burn all day solar powered candle by itself
is of limited value.

It needs to be bundled with something else….. for example a Stirling engine to
generate electricity to drive the electric eye on-off light switch.

Not excited yet? OK – then how about we included an infra red
beam that rings a bell in the office when a customer comes into the shop.

 

Well, handy but…..

OK OK – We add two stirling generators, a flywheel, a water
pump and build a swimming pool on the roof with a water powered dynamo and call
it the solar powered candle battery storage sytem.

 

Huh?

OK, all day – the pump pushes water up to the swimming
pool then all night it falls down to the ground floor pool and generates
electricity using hydroelectric dynamos…. Simple – See?

 

But it has no relationship to my original invention……

 

No – but it could put all those battery manufacturers out of
business.

And the real money comes not from the sale of solar powered
candles but the REC’s that you
can generate with all of that green energy.

 

Kevin Rudd is likely to propose marriage if you can solve
his Kyoto Carbon Offset program.

 

Oh – I see.

 

The secret is not the invention – but the perception of the
disruption on established industry and convention.

 

Here are a couple of inventions that were not successfully
commercialized when invented.

 

The aeolipile – Worlds first Steam Engine. 250BC to 80 AD Attributed to Hero of Alexandria but probably invented by Ctesibius     According to Diogenes Laertius, Ctesibius was miserably poor. Laertius details this by recounting the following concerning the philosopher Arcesilaus: “when he had gone to visit Ctesibius who was ill, seeing him in great distress from want, he secretly slipped his purse under his pillow; and when Ctesibius found it, 'This,' said he, 'is the amusement of Arcesilaus.'”

 

Worlds first Rocket – approx 320 BC Archytas of
Tarentum

 

Imagine where we would be if that first rocket were
developed commercially…

Imagine where we would be if the steam age had started two
thousand years ago instead of three hundred years ago.

 

Both of these products failed because they lacked time to
market impact.

 

Why?

 

Because “machines were the work of the Devil” and mother Church, and or other Luddites kept the devlopments from proceeding to a logical conclusion.

Why?

Because homo sapien ignoramus is unfortunately much more successful at being elected to positions of power than homo sapien “speak my mind honestly”. 

 

And, what ignoramus cannot fathom, understand or profit from, personally, is immediately, the work of the devil/pirates/insurgents (feel free to add your own favourite).

So, whilst academics consider that they have invented the
mousetrap that will end all hunger and bring everlasting peace to earth,
without the visionary, the promoter, the salesman and the financier, the
academic might as well have stayed at home.

 

P2P is a lot like that first Steam engine and rocket.

 

It works – now it just needs to be commercialized before the
Pope errr, Governments manage to stamp it out of existence entirely.

 

P2P is not the work of the devil. Nor should it be demonized.
There are a number of simple ways to commercialise P2P. These should be
investigated, implemented and we should move on; successfully towards a
brighter, sounder economic future.

 

Reference:

 

The machine at work: technology, work, and organization

Keith Grint, Steve – Wiley-Blackwell, 1997 ISBN 0745609244,
9780745609249

 

God, the devil, and Darwin:
a critique of intelligent design theory

(Not about machines – but still a relevent overview of the churches involvement in scientific matters).

Niall Shanks – University Press US, 2004 ISBN 0195161998,
9780195161991

 

Wikipedia

 

This entry was posted on August 15, 2009 at 12:52 pm. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Posted in Main Page by Tom Koltai No Comments Yet