If you see a person--or a company--doing something that seems completely and inexplicably boneheaded, then it's unwise to assume that the reason must be that everyone but you is a complete idiot who is blind to fairly trivial insights such as "people desire inexpensive and conveniently available movie services, and will resist having those services made more expensive, or less convenient".  While it's certainly true that people do idiotic things, it's also true that a lot of those "idiotic" things turn out to have perfectly reasonable explanations.

And in fact, if management of all these large public companies really were the staggeringly malevolent yet totally hapless lackwits that so many seem to believe, it should be really, really easy to get rich by outwitting them.  Oh, sure, they'd probably get all their rich friends in Congress and Kiwanis to gang up on you, but since, according to the internet, almost all those people are also too dumb to come in out of the rain, you should be able to defeat them with a couple of well-placed banana peels.

If you've found it maybe not quite that easy to make a pile of money by outguessing all these benighted fools, then perhaps you should consider the possibility that they aren't quite as stupid as you are making them sound when you sniffily ask "Why don't they just . . . ?

The idea for the iPad came from an engineer at Microsoft, who was married to a friend of the Jobs family, and who invited Jobs to his fiftieth-birthday party. As Jobs tells Isaacson:

This guy badgered me about how Microsoft was going to completely change the world with this tablet PC software and eliminate all notebook computers, and Apple ought to license his Microsoft software. But he was doing the device all wrong. It had a stylus. As soon as you have a stylus, you’re dead. This dinner was like the tenth time he talked to me about it, and I was so sick of it that I came home and said, “Fuck this, let’s show him what a tablet can really be.”

During WWII, statistician Abraham Wald was asked to help the British decide where to add armor to their bombers. After analyzing the records, he recommended adding more armor to the places where there was no damage!

This seems backward at first, but Wald realized his data came from bombers that survived. That is, the British were only able to analyze the bombers that returned to England; those that were shot down over enemy territory were not part of their sample. These bombers’ wounds showed where they could afford to be hit. Said another way, the undamaged areas on the survivors showed where the lost planes must have been hit because the planes hit in those areas did not return from their missions.

If your attitude toward the lives of others is that of a house burglar confronted by an open window; if you consider it part of your business to fabricate conversations where none exist; and if your boss treats his employees with a derision that they, following suit, extend to the subjects of their inquiries—if those elements are already in place, then the decision to, say, hack into someone’s cell phone is almost no decision at all. It is merely the next step. All that is required is the technology. What ensues may be against the law, but it goes no more against the grain of common decency than any other tool of your trade. This has been confirmed by Paul McMullan, a former deputy features editor at the News of the World, who started by blowing the whistle on phone-hacking and now appears, for the hell of it, to have switched from a whistle to a trumpet. Questioned on the BBC, on July 5th, he said that, having pondered the matter of Milly Dowler’s messages being hacked, he has come to view it as “not such a big deal.”

As the law stands now, the authorities may obtain cloud e-mail without a warrant if it is older than 180 days, thanks to the Electronic Communications Privacy Act adopted in 1986."

More details:

At that time, e-mail left on a third-party server for six months was considered to be abandoned, and thus enjoyed less privacy protection. However, the law demands warrants for the authorities to seize e-mail from a person's hard drive.

A coalition of internet service providers and other groups, known as Digital Due Process, has lobbied for an update to the law to treat both cloud- and home-stored e-mail the same, and thus require a probable-cause warrant for access. The Senate Judiciary Committee held a hearing on that topic Tuesday.

The companies -- including Google, AOL and AT&T -- maintain that the law should be changed to reflect that consumers increasingly access their e-mail on servers, instead of downloading it to their hard drives, as a matter of course.

But the Obama administration testified that imposing constitutional safeguards on e-mail stored in the cloud would be an unnecessary burden on the government. Probable-cause warrants would only get in the government's way.

"Follow us on Twitter" Why? I'm not a stalker. I'm not a lap dog. Do you think my friends will be impressed if I tell them: "I follow lots of stuff on Twitter." Sure. "Join our newsletter." Why? "Watch our videos." Yeah? Oh, I haven't seen a video in days. Can't wait to see yours.

Formats are a really terrible form of navigation. I was talking to someone recently who has a big video section on their homepage. Let's say they're in the business of supporting start up companies. They gave customers tasks like: "Watch our video on how to get start up funding."

Not a single person found the videos. Why? Because they went scanning and searching for funding. They did not think video, they thought funding. When you want to book a flight do you go looking for a tool? Is Google a tool? Is Twitter or YouTube a tool? When you need to convert currency, do you think 'I need a tool to do this'?

Web teams are obsessed with their recently launched Twitter feeds, their tools, their documentation, videos, blogs. Customers are obsessed with their tasks.

Android, as well as Chrome and Chrome OS for that matter, are not "products" in the classic business sense. They have no plan to become their own "economic castles." Rather they are very expensive and very aggressive "moats," funded by the height and magnitude of Google's castle. Google's aim is defensive not offensive. They are not trying to make a profit on Android or Chrome. They want to take any layer that lives between themselves and the consumer and make it free (or even less than free). Because these layers are basically software products with no variable costs, this is a very viable defensive strategy. In essence, they are not just building a moat; Google is also scorching the earth for 250 miles around the outside of the castle to ensure no one can approach it. And best I can tell, they are doing a damn good job of it.

With Android, they are not building a business, they are building a moat.

Google has organized this defensive play with precision. Carriers and handset makers that use Android are given economics to do so. The Android version of the "AppStore" shares the majority of its economics with the carrier and handset makers. Once again, they are not building a business, they are building a moat (sorry for the repetitiveness, it's intentional). Because they are "giving away" money to use their product, this creates a rather substantial conundrum for someone trying to extract economic rent for a competitive product in the same market.

This is the part that amazes me the most. I don't know if a large organized industry has ever faced this fierce a form of competition – someone who is not trying to "win" in the classic sense. They want market share, but they don't need economics. Imagine if Ford were faced with GM paying people to take Chevrolets? How many would they be able to sell? What if you received $0.10 for every free Pepsi you consumed? Would you still pay $1.50 for a Coke?

Home delivery outside of New York
7 Days: $64 a month or $770 a year
Friday-Sunday: $45 a month or $541 a year
Sunday: $33 a month or $390 a year
Weekday: $32 a month or $385 a year

Digital only
Web and smartphone apps: $16 a month or $195 a year
Web and tablet apps: $22 a month or $260 a year
Web, smartphone and tablet apps: $38 a month or $455 a year

So, as a consumer in New Hampshire who values mobile access to news, my absolute cheapest price for access to the Times app on my iPad alone is $260 per year.

But if I want to read the Times on my iPhone too, I may as well get the paper delivered five days a week. That beats the “Web plus mobile apps” package by $70 a year.

That just does not add up. The Times said last week that its pricing plan was the result of extensive consumer feedback. But which consumers said the problem they wanted to solve was how to pay a $70 premium not to receive the print newspaper?

Page has little patience for the bureaucracy that most large companies require. In 2007, he noticed that having an assistant made it easier for his coworkers to schedule meetings with him. “Most people aren’t willing to ask me if they want to meet with me,” he says. “They’re happy to ask an assistant.” That was an undesirable situation, Page says, “because my favorite meeting is the absence of meetings.” So one day, Brin and Page abruptly got rid of their assistants. Anyone who wanted to talk to them had to stalk them. Like the plane spotters who log the peregrinations of aircraft, Googlers often swap data concerning Page’s and Brin’s ambulatory patterns. Even so, it can sometimes be tricky to catch Page; he is a master of the drive-by greeting, flashing a wide, happy-to-see-you smile while slightly picking up his pace, leaving a potential interlocutor talking to his receding back.

“I remember when I was growing up, the rule was, ‘Don’t call anyone after 10 p.m.,’ ” Mr. Adler said. “Now the rule is, ‘Don’t call anyone. Ever.’ ”

Phone calls are rude. Intrusive. Awkward. “Thank you for noticing something that millions of people have failed to notice since the invention of the telephone until just now,” Judith Martin, a k a Miss Manners, said by way of opening our phone conversation. “I’ve been hammering away at this for decades. The telephone has a very rude propensity to interrupt people.”

Though the beast has been somewhat tamed by voice mail and caller ID, the phone caller still insists, Ms. Martin explained, “that we should drop whatever we’re doing and listen to me.”

Even at work, where people once managed to look busy by wearing a headset or constantly parrying calls back and forth via a harried assistant, the offices are silent. The reasons are multifold. Nobody has assistants anymore to handle telecommunications. And in today’s nearly door-free workplaces, unless everyone is on the phone, calls are disruptive and, in a tight warren of cubicles, distressingly public. Does anyone want to hear me detail to the dentist the havoc six-year molars have wreaked on my daughter?

“When I walk around the office, nobody is on the phone,” said Jonathan Burnham, senior vice president and publisher at HarperCollins. The nature of the rare business call has also changed. “Phone calls used to be everything: serious, light, heavy, funny,” Mr. Burnham said. “But now they tend to be things that are very focused. And almost everyone e-mails first and asks, ‘Is it O.K. if I call?’ ”

Predicting people’s behavior is becoming big business—and increasingly feasible in an era defined by accessible information. Data crunching by Canadian Tire, for instance, recently enabled the retailer's credit card business to create psychological profiles of its cardholders that were built upon alarmingly precise correlations. Their findings: Cardholders who purchased carbon-monoxide detectors, premium birdseed, and felt pads for the bottoms of their chair legs rarely missed a payment. On the other hand, those who bought cheap motor oil and visited a Montreal pool bar called "Sharx" were a higher risk. "If you show us what you buy, we can tell you who you are, maybe even better than you know yourself," a former Canadian Tire exec said.  

Science writer Isaac Asimov said, "The most exciting phrase to hear in science, the one that heralds the most discoveries, is not Eureka! (I found it!) but, 'That's funny...'" That phenomenon was also noticed by Lewis Thomas, the former dean of medicine at Yale and president of Memorial Sloan-Kettering Institute. "It seems to me that whenever I have been around a laboratory at a time when something very interesting has happened, it has at first seemed to be quite funny," he recalled. "There's laughter connected with the surprise -- it does look funny. And whenever you hear laughter and somebody saying, 'But that's preposterous!' -- you can tell that things are going well and that something probably worth looking at has begun to happen in the lab."

Indeed, this is the secret of visionary ideas: Most earthshaking ideas look funny at first. They are not sensible. Think of the jokes that have been pulled: Jobs introducing the iMac -- without a floppy disk! Branson, with no experience in it, starting an international airline. Disney (DIS, Fortune 500), at the depth of the Great Depression, proposing a full-length feature cartoon. "You have to have confidence in nonsense," says airplane designer Burt Rutan, whose aircraft have circled the globe on a single tank of gas, and have climbed to the edge of space as well.

"We build toys," said Nassim Taleb. "Some of those toys change the world."

And now comes the hardest part of the visionary's quest: selling those silly ideas to a skeptical world.

very few publishers of money-losing dailies can elude the following question:  Wouldn’t it be smarter to accelerate the downward spiral of their print activity in order to feed more oxygen and nutrients to the emerging online business? Each time I’m testing the idea with my fellow European publishers, I’m getting a straight answer: “No f**** way, pal. Print is still where the revenue is!”  I politely refrain from saying “so are your losses, pal “. Beyond this thin-skinned reaction lies a more rational fear: brand dissolution into the digital maelstrom. And there is no successful example of the kind of bold move I recommend.

Still.

I don’t see any newspaper surviving without a major structural change in its business. An example: Being published every day will make less and less sense as most of the developing and breaking news is read (and heard or viewed) on a smartphone. On the contrary, long form reporting, or visually rich storytelling could still thrive on paper, a format in which glossy ads will stay in high demand and command correspondingly high prices. Such publications — one or two days a week — have the ability to remain powerful brands vectors.

Gmail users are most likely to be thin young men ages 18-34 who are college-educated and not religious. Like other young Hunch users, they tend to be politically liberal, single (and ready to mingle), and childless. Gmail users live in cities and have traveled to five or more countries. They’re career-focused and plugged in — they mostly read blogs, have an iPhone and laptop, and listen to music via MP3s and computers (but they don’t have a DVR). At home, they lounge around in a t-shirt and jeans. Gmail users prefer salty snacks and are introverted and entrepreneurial. They are optimistic or pessimistic, depending on the situation.

Hotmail users are most likely to be young women of average build ages 18-34 (and younger) who have a high school diploma and are not religious. They tend to be politically middle of the road, single, and childless. Hotmail users live in the suburbs, perhaps still with their parents, and have traveled to up to five countries. They mostly read magazines and contemporary fiction, have a laptop, and listen to music via MP3s and computers (but they don’t have a DVR). At home, Hotmail users lounge around in a t-shirt and jeans. They’re introverts who prefer sweet snacks and like working on a team. They consider themselves more pessimistic, but sometimes it depends on the situation.

Yahoo! users are most likely to be overweight women ages 18-49 who have a high school diploma and are spiritual, but not religious. They tend to be politically middle of the road, in a relationship of 1-5 years, and have children. Yahoo! users live in the suburbs or in rural areas and haven’t traveled outside their own country. Family is their first priority. They mostly read magazines, are almost equally likely to have a laptop or desktop computer, listen to the radio and cds, and watch TV on 1-2 DVRs in their home. At home, Yahoo! users lounge around in pajamas. They’re extroverts who prefer sweet snacks and like working on a team. Yahoo! users are optimistic or pessimistic, depending on the situation.

Science has proven that hearing half a conversation, as you're forced to do when close to a cell phone user, is inherently more distracting to the human brain. In one experiment, people were asked to try to concentrate on a task in total silence, and then while overhearing two people conversing with each other. They performed equally well both times. But when half a conversation was played, performances dropped dramatically. Another study showed that people on public transport recalled more details of a one-sided conversation than a two-sided one, even if they'd been trying to ignore both.

The human brain likes things to be predictable, and it can't really relax and "tune out" something that doesn't make sense. You might notice yourself trying to fill in the other half of the phone conversations you overhear. It's the same mechanism that makes it so hard to walk away after you've seen the first 15 minutes of an episode of CSI or Law & Order: The brain naturally hates leaving questions unanswered. Suddenly, you're trying to solve a puzzle instead of concentrating on how little you give a shit about the exact drunken position he passed out in last night.

Yet everything that is said about the Internet’s destruction of “interiority” was said for decades about television, and just as loudly. Jerry Mander’s “Four Arguments for the Elimination of Television,” in the nineteen-seventies, turned on television’s addictive nature and its destruction of viewers’ inner lives; a little later, George Trow proposed that television produced the absence of context, the disintegration of the frame—the very things, in short, that the Internet is doing now. And Bill McKibben ended his book on television by comparing watching TV to watching ducks on a pond (advantage: ducks), in the same spirit in which Nicholas Carr leaves his computer screen to read “Walden.”

Now television is the harmless little fireplace over in the corner, where the family gathers to watch “Entourage.” TV isn’t just docile; it’s positively benevolent. This makes you think that what made television so evil back when it was evil was not its essence but its omnipresence. Once it is not everything, it can be merely something. The real demon in the machine is the tirelessness of the user. A meatless Monday has advantages over enforced vegetarianism, because it helps release the pressure on the food system without making undue demands on the eaters. In the same way, an unplugged Sunday is a better idea than turning off the Internet completely, since it demonstrates that we can get along just fine without the screens, if only for a day.

Bryant says, "I reply all the time by saying, 'Thank you for writing, I appreciate your opinion though I don't know why you needed to insult me.' The general response is 'Gee, I didn't think anyone was paying attention.' And they want to be pals with you. It's the kick-the-dog syndrome. People believe no one's listening; they think we're not people, they think there are these giant monoliths controlling thought. Then when they realize someone is listening, they rediscover their manners.