It comes as no surprise that greed can get in the way of good judgment. Nor is it surprising that the computer industry has its fair share of nincompoops who put spare change before common sense. In a speech before a group of influential Texas business leaders and educators, for instance, John Roach, chairman and CEO of Tandy Corp., scolded educators for continuing to teach "obsolete" skills such as cursive writing and long division. What schools should be doing, he said, is buying computers and calculators--presumably those made by Tandy. "We don't have anyone in my company doing long division," said Roach.
I don't know about you, but I'm certainly relieved that Tandy executives don't have to count on their fingers and toes anymore. Unlimbering a Radio Shack calculator is a lot easier than pulling off socks and boots, at least when you need to figure out how to split a $40.00 lunch tab. On the other hand, if Tandy bothered with long division anymore, it might have run across those floating-point division problems in its Pentium-based PCs a little sooner.
Then there's Martha Siegel, author of How to Make a Fortune on the Information Superhighway and CEO of Cybersell, an Arizona company that provides Internet marketing services. Citing rampant fraud, sexual harassment, defamation, forgery, and profanity on the Internet, Siegel, in a San Francisco Chronicle op/ed piece, is screaming for the federal government, Supreme Court, and international diplomats to step in and regulate the Net. In particular, Siegel is incensed that programs called "cancellor robots"(or "cancelbots") can erase messages from specified sources. I'm assuming such messages include unsolicited electronic junk mail from Internet marketing services.
It is noteworthy that the openness leading to the abuses Siegel claims is the same openness that enabled her to carve out a comfortable business niche in the first place. Now that Siegel has settled in, it is time for the government to keep out the competition.
And when it comes to greed, it's hard to forget CompuServe. After defining the Graphics Interchange Format (GIF) as a means of transferring graphics data, CompuServe actively encouraged developers to support the specification with a no-cost policy--all developers had to do was acknowledge CompuServe's copyright.
What CompuServe forgot to say (or didn't realize in 1987) was that LZW--the heart and soul of GIF--had been patented by Unisys (née Sperry) in 1985. Even though it was public knowledge that GIF was LZW based and that LZW was patented (DDJ reported on this in 1989), it wasn't until 1994 that the two companies agreed on a licensing agreement. CompuServe has to pay Unisys a royalty of 1 percent (or about $.11/copy) for each copy of CompuServe Information Manager connection software it sells, along with a one-time fee of $125,000 for past use, and a $5000 monthly fee. In addition, CompuServe got the right to relicense LZW to developers using GIF in software that connects to CompuServe. With this agreement in pocket, CompuServe decided to cover its losses by demanding a royalty of 1.5 percent, or $.15/copy (whichever is greater) from developers who have supported GIF--the same developers who have helped CompuServe grow to be the biggest of the commercial online-information services.
In doing so, CompuServe chose not to alienate its customers by passing on the costs. Instead, the company decided to soak third-party developers. While in all likelihood CompuServe started out by breaking intellectual-property laws, it ended up breaking something even more significant--the trust of its longtime partners.
Finally, what would a discussion of greed be without mention of the government. You may recall that in August 1994, I described the troubles Ruth Koolish is having with the California Board of Equalization--the tax board. California tax collectors see the information highway as a new source of revenue, and they are apparently using Koolish as the test case for levying sales taxes on electronic data transfers. (Her case still hasn't been resolved, by the way.) Other states--Illinois, Florida, Maryland, Massachusetts, Ohio, and Rhode Island, to name a few--are trying to cash in on the information highway by extending sales and use taxes for telecommunications and information services. Florida, for instance, hopes to raise $120 million by including information services under its 6 percent tax umbrella.
For its part, New York last year tried to increase its standard 8 percent tax rate for information-service-related revenues to 13 percent. After protests, the New York Department of Taxation and Finance ruled that the full 13 percent tax did not apply to services that have a written component. Therefore, since you can generate a hard copy of the data you download to your PC, only the 8 percent sales tax applies. (The full 13 percent tax applies to those services which are exclusively aural; 900-number phone services, for instance.) On one hand, government at all levels is calling for the "paperless office." New York, on the other hand, is forcing businesses and individuals to maintain ties to paper documents. Of course, you could counter that when it comes to government, one hand doesn't always know what the other is doing. The only thing you can be sure of is that both hands will be reaching into taxpayer's pockets.
editor-in-chief
Copyright © 1995, Dr. Dobb's Journal