Universal Music Group will drop the prices on the majority of its new CD releases to between six and 10 dollars. This plan dubbed the Velocity program will go into effect in the second quarter of this year.

UMG hopes this plan will at least slow the serious decline in CD sales that has been going on since MP3s and other digital music downloads came on the scene.

While UMG has its hands in music downloads and streaming, too, the profit margins are usually better with CDs. UMG claims that its cheaper CD plan will maintain a 25% profit margin.

Up until now, most new CDs have actually been more expensive than their download counterparts. If the price comes down, consumers will be more likely to purchase the goods. It's a simple economic principle. But to try to incentivize music fans even further, UMG plans to load the jewel cases with deluxe content that you won't usually get with online purchases.

We're not going to complain about lower prices. We welcome anything that reduces consumers' expenses. But do you think this will actually make a difference? A couple of us in the Mashable office haven't bought a CD in years if you're the same, will UMG's plan turn you around?

[img credit: lrargarich]

Tags: CD, CDs, digital downloads, music, umg, universal music group

(photo: Evil Erin)

Matt Yglesias analyzes the failure of the progressive block strategy, and chalks it up to progressives not picking issues that centrists care about.

He doesn't note his own role in that failure, vilifying the leader of the progressive block Raul Grijalva as the world's greatest monster unless he backs down. (Our own whip effort started to back Grijalva's efforts, which were already underway in the House when we started in June of 2009.)

I've said many times that it's impossible to expect progressive members of Congress to hold together if they don't have the backing of their natural fiscal constituencies the liberal interest groups and the unions. Without that support, they're left to raise money from PACS and other corporate sources to sufficiently fund their campaigns. That's why they take turns championing progressive bills that ultimately fail so they can pretend they do something, and then vote for bad bills that ultimately pass so someone else can be the failed hero. When Tammy Baldwin votes for one PhRMA-friendly bill after another, progressives can say hey, but she's so good on LGBT issues! Which never actually pass either, but the kabuki keeps activists sufficiently docile and donating to large organizations who fundraise off amping up outrage.

But it's also worthy to note that it's hard for them to withstand the assault of liberal pundits who sneeringly derided their efforts as naive, futile and purist. They should be proudly taking credit for their role in delegitimizing progressive opposition to the bill in liberal intellectual circles, much the same role that the same people played during the Iraq war. After all, it's TNR's stock in trade.

I'll leave it to others to analyze how corporate cash was laundered through foundations to underwrite the efforts of various opinion leaders in the health care debate, but it definitely deserves more scrutiny. . .

Monday, June 1, 2009

Kaiser Family Foundation Launches New Non-Profit Health Policy News Service

Menlo Park, CA In the midst of a major federal health reform debate and the ongoing financial turmoil in the media industry, the Kaiser Family Foundation officially launched Kaiser Health News (KHN) today to provide a new source of in-depth reporting on major health issues. KHN is staffed by experienced health policy journalists and editors, and will feature contributions from a wide array of leading health policy commentators and independent journalists.

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At the heart of KHN will be in-depth, explanatory stories about complex health policy issues and major developments in Washington, D.C., and around the country in the health care marketplace and health care delivery system. The news service will cover policy stories like health care reform, developments in major public health coverage programs like Medicare and Medicaid, and complicated ongoing policy challenges like the financing of long-term care, and it will examine the nation's health care system from a consumer perspective. KHN will also provide a synthesis of health policy news coverage through a daily health policy report, original programming from Kaiser's broadcast studio, and regular columns from contributing writers and experts. Jonathan Cohn, senior editor of The New Republic, and Howard Gleckman, senior research associate at the Urban Institute and former senior correspondent at Business Week, will be writing bi-weekly columns. Among others who will contribute occasional columns are: Michael Cannon of the Cato Institute, Jim Capretta of the Ethics and Public Policy Center, Judy Feder of the Center for American Progress, and Mark Pauly of the Wharton School at the University of Pennsylvania.

The development of Jonathan Gruber's much-vaunted model, which formed the justification for econo-wonks and politicians alike to support the Senate bill's voodoo claims about the excise tax, was originally paid for by the Kaiser Family Foundation in 1999 according to Gruber. It was given a facelift this year courtesy of the Small Business Majority, whose money comes from foundations including the Blue Cross Blue Shield Foundation. (h/t spanishinquisition)

And recall that Kaiser Permanente was the original sponsor of the Washington Post pay-to-play salons.

You have to wonder if any of that Kaiser cash underwrote other efforts at the Post after the parties fell through.

HCAN's efforts were funded by Atlantic Philanthropies, the Robert Wood Johnson Foundation and George Soros foundations, among others.

So, come on, pundits. Don't let the lameness of progressives in Congress get all the credit for shooting down the public option, rolling back choice, and teeing up constitutional amendments to overturn the health care bill around the country.

Stand proud.

Tags: Blogosphere, Jonathan Gruber, Kaiser Family Foundation, Matt Yglesias, Media, new media, Raul Grijalva, Robert Wood Johnson, The New Republic, TNR, veal pen

Scientists have created a flat surface patterned after the body hair of spiders that refuses to get wet.

The surface also has the added benefit of being self-cleaning, since water does a pretty good job of picking up and carrying off dirt as it is being repelled.

This makes the material ideal for some food packaging, windows, or solar cellsthat must stay clean to gather sunlight, scientists say. Boat designers might someday coat hulls with it, making boats faster and more efficient.

But what makes the new surface really unique is that unlike other similar products out there, such as shoe wax and car windshield treatments, the new material doesn't rely on chemicals with water-repellent properties to stay dry. Instead, its surface blocks out water by mimicking the shape and patterns of a spider's body hair. In other words, physics, not chemistry, is what keeps it dry.

Spiders "have short hairs and longer hairs, and they vary a lot. And that is what we mimic, said Wolfgang Sigmund, a professor of materials science and engineering at the University of Florida.

It's been long known that spiders use their water-repelling hairs to stay dry or avoid drowning. Water spiders use their hairs to capture air bubbles and tote them underwater to breathe. But it was only five years ago that Sigmund began experimenting with microscopic fibers, turning to spiders for inspiration.

At first, Sigmund's natural tendency was to make all his fibers the same size and distance apart. But he later learned that the pattern of hairs on a spider's body consists of both long and short hairs that are both curved and straight. So he decided to mimic Nature and replicate this random pattern using plastic hairs varying in size but averaging about 600 microns, or millionths of a meter.

Most people that publish in this field always go for these perfect structures, and we are the first to show that the bad ones are the better ones, Sigmund said.

The technique, detailed in the science journal Langmuir, can be applied to keep even absorbent materials like sponges from getting wet. It may also be safer than other forms of water-proofing since the method doesn't involve the use of chemicals.

Sigmund says that he has even developed a variation of the surface that repels oil. However, he noted that the process is not reliable enough to continually create good working surfaces, and different techniques need to be developed to produce such surfaces in commercially available quantities and size.

We are at the very beginning, Sigmund said. But there is a lot of interest from industry, because our surface is the first one that relies only on surface features and can repel hot water, cold water, and if we change the chemistry both oil and water.

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With each new milestone in technological evolution we've seen a company emerge as the clear leader. In the current landscape, we observe this happening in several key parts of the marketplace including networking, search and operating systems.

Cloud computing is a new disruptive force that makes us ask the question whether we'll see the future of the cloud dominated by a single company. In this multi-part series, we'll take a look at a handful companies and envision what the world might look like, if, in fact, they win it all. We'll also analyze what it will take for a new company to rise up and claim the leadership role in this chapter of computing.

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Dominance Happens: A Bit of Recent History

There has been a love/hate relationship with companies that dominate markets. On one hand, it's us consumers that make it happen. But when they become giants we cheer as governement regulators and competitors knock them down.

Microsoft has faced this issue perhaps more than any company in the past few decades. When the browser battles were in full swing in the late 1990s, Microsoft was taken to court by the Department of Justice for antitrust violations.

In this note released in 2000 - Technology, Market Changes, and Antitrust Enforcement -Microsoft evaluated the idea of whether it was consistent with public welfare for a company to "win" a technology market, and what it means to have a network effect in technology.

Microsoft makes the point that no technology company will hold a dominant position for long if it doesn't innovate and expand the market definition. Additionally, if a company doesn't find the right balance of trust and pricing between its customers new technologies will find a way into the market and cause customers to defect.

Point: A Dominant Vendor Will Emerge in the Cloud

Taking these factors into consideration, we believe there are several points that can support the argument that a dominant player in cloud computing in the future. Due to the nature of market forces a single vendor will emerge as the clear leader in offering cloud solutions.

• First mover advantage: We're already seeing amazing things happen at first-movers like Amazon that are defining product and pricing. This gives them an advantage in fueling further growth and by learning and iterating the solutions in the market. Being first in an infrastructure-driven business will help them reach scale that others just can not reach easily - and potentially price it where others can't match.
• Vendor lock: Once you get started with an infrastructure provider it becomes interwoven into business operations. By the current nature of the cloud (e.g. little standards, a lot of innovation) being first with leading solutions adds more momentum to the first-mover that wins strategic customers.
• Strategic synergies: When we look at the combination of cloud computing and collaboration, we see a natural fit in services that meet more needs and take more market share. It may just work out that bundling works also in the cloud and creates the network effect that Microsoft is famous for. Cisco is also partnering across the landscape, with a focus on preparing the network for the cloud. By making it easier to manage your cloud with Cisco gear, it will provide IT leaders a reason to expand their relationships today, and stay tomorrow.
• Acquisitions and Partnerships: Companies that buy their way into the market will be a big factor in putting momentum behind their offerings. Companies to watch: VMware, Cisco, Oracle. These companies are already showing that the race is on to win the cloud through aggregation of capabilities. Cisco has a blog dedicated to Cloud Computing, Oracle is going on tour sharing its ambitions for the cloud

Counterpoint: A Dominant Company Will Not Emerge in the Cloud

Perhaps no single organization will have the ability to create a dominant foundation in cloud computing. Instead, we'll see many types of solutions as equal peers in the market.

In a way, this runs against the grain of existing technology landscape and our history with successful innovations. Maybe that is why we love the idea of the cloud itself?

• It's too big to own: One big reason to doubt a single dominant force in the cloud is that it feels like owning the Internet. Even Cisco with its strengths can't make such a claim. Perhaps the cloud is the perfect market, where the barriers of entry are low enough that continual evolution will occur.
• It's a movement, not a layer: Another argument against the cloud having a dominant player is its fuzzy definition. There are many parts and pieces to it, and it's not clear today what it would mean to "win" the cloud computing market.
• Portability will keep vendors in check: If customers demand solutions where they can move from vendor to vendor freely, it will impact the landscape. Companies with cloud solutions in the marketplace could be required by these customers to remove barriers to moving data and services between different entities. Additionally, standards and best practices may emerge that allow companies and individuals to move freely between providers. In this world, it will become a fluid market that prevents vendor lock and promotes pricing and trust as brand differentiators.

A Glimpse at Potential Futures

We've compiled a list of companies worth reviewing as candidates as possible dominant players in cloud computing. We'll be looking at their brand and the available assets that could be leveraged to achieve this position. Finally, we'll take a fresh look at what it might feel like if they succeed and shape the brave new world of cloud computing.

The list of candidates we're analyzing includes: Google, Microsoft, Apple, VMware, IBM, HP, Cisco, Amazon, Salesforce, Facebook, and our favorite, Insert new startup to our list by adding a comment below.

Please let us know what you hopes and fears are with the cloud computing marketplace. Any companies we should we add to our list (or remove)? What's your take: Is there one company today that is best positioned to win the cloud?

Photo credit: reddodo & savingfutures

We Americans like to think of ourselves as trendsetters for the rest of the globe, but when it comes to cell phones, we're still playing catch-up with countries such as Japan and Korea.

In general, Asians use their cell phones in more robust ways than the typical U.S. resident as TVs, wallets, GPS devices, and music players. Japanese cell phones can double as a house key, a credit card, and an ID. Users can even use their cell phones to send their vital signs straight to their doctors.

In recent years, U.S. companies have made baby steps toward incorporating more advanced cell phone features, particularly in the areas of mobile banking and video broadcast. Meantime, the Asian cell phone market continues to be a good predictor of features that could soon be included in American cell phones. For example, Japan had cameraenabled cell phones two years before Americans ever went gaga for them.

Curtis Schenck, a manager of corporate relations at NTT DoCoMo USA, gave TechNewsDaily the scoop on the hottest features in the Japanese market right now. Try not to be too jealous.

1. Personal Butler

Customers don't have to Google for information, since i-Concierge acts as their butlers or personal assistants and caters to their every need. Users can input their food preferences, neighborhoods they like, and entertainments that they enjoy. When new information is downloaded into the system, they get push notifications that are based on their preferences. For example, if they like Thai food and a new Thai restaurant that is opening nearby, their cell phones will notify them.

2. Investigative Visits

This takes the Verizon commercials to a whole new level. If a users' five-bar reception signal drops to three bars or if they have a dropped call, they can call customer service and a team will be sent out to investigate the problem.

3. Barcode Reader

Japanese phones can read QR marks, which are sophisticated barcodes for businesses. If an Asian cell phone user is walking down a Tokyo street and walks past a restaurant that isn't open, they can point their camera to the QR mark and their phone's browser will automatically be routed to the restaurant's Web site.

4. Free TV on the Phone

Subscribers can surf 13 free TV channels on their phones. DoCoMo has also launched their own channel called BTV to air programs that are filmed specifically for the mobile phone.

5. Phones as Payment Systems

Osaifu Keitai, also known as the mobile phone wallet, lets users load up credit card information onto their phones. If stores have a reader, users can swipe their phones over it to pay for their purchases. Cell phones can also be used to pay for subway and train tickets.

6. Send Money to Other Subscribers

Some Asian countries allow users to send money using their cell phones. Users simply input another person's phone number and the amount they owe them and like magic, the money is transferred.

7. Internal Wi-Fi Spot

Japanese cell phone users can download a movie onto their mobile phones and show it on their TVs. This is another way to get entertainment on demand. A femtocell base transceiver station (BTS) in the home hooks up mobile phones to the DoCoMo network through a broadband line such as an optical fiber. The femtocell BTS lets a person with a cell phone download videos and music files. Through femtocell BTS, a person can set up a private wireless network for their home appliances, entertainment systems, and other devices.

8. Home Security Service

Japanese cell phone users can lock their doors and manage their home security systems remotely using their mobile devices. They can also adjust appliances and set environmental controls, so their lights and heat can be switched on before they get home.

9. Environmental Awareness

DoCoMo has deployed environmental sensors throughout Japan and people are now able to monitor air quality, temperature, and UV rays around them using their cell phones.

10. Reads Vital Signs

In the same way that we might plug headphones into our iPhones, Japanese cell phone users can plug in equipment such as a blood pressure monitor to their phones and send vital signs directly to their doctors. This helps save some people a trip to the doctor.

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Facebook users in the American West appear to move around a lot, and often have friends throughout the country, while users from Minnesota to Manhattan have connections much closer to home.

And in areas in and around Texas, on the edge of what's generally thought of as the Bible Belt, the Dallas Cowboys rank higher overall on users' fan pages than God.

These are just some of the interesting findings about Facebook users recently discovered by Pete Warden, a Colorado-based, British-born ex-Apple engineer who has spent the last six months gathering and analyzing data from more than 215 million public Facebook profile pages.

What he's discovered just might shed more light on the culture of connected America than the 2010 census.

"If you actually look at [Facebook user data] in the aggregate, it's like a painting," Warden told TechNewsDaily. "Each individual data point isn't interesting, but when you step back and look at the trends in millions of profiles, you start to see some pretty interesting pictures emerging."

Warden says he's been overwhelmed by the response he's gotten from this project, after working on similar projects in obscurity for years.

Among Warden's less surprising findings: Fox News host Glen Beck gets the number one spot on Facebook fan pages from users in Eastern Idaho. And the "Twilight" books, penned by Mormon author Stephenie Meyer, rank high in the heavily Mormon communities in and around Utah.

Facebook mining

These and other observations that Warden mined from the massive amount of Facebook data were posted on his blog last week, along with maps that break down the U.S. into seven regions based on Facebook user trends.

Now, after gathering the data from Facebook's site using software he designed and honed in the process, and making a first round of enticing observations, he wants to turn the raw data he's culled over to academia for further analysis. But he also hopes to steer investors and customers to his own software and services for further data gathering and aggregation.

"I'm much better at building the pipeline for processing the data than I am at doing really rigorous stuff with the results that come out at the end," Warden said in a telephone interview. "The patterns that I've blogged about in the U.S. data are very qualitative."

Indeed, much of the conclusions that Warden has drawn are open to interpretation, and his given names for America's regional social connection groups "Stayathomia" (the Northeast), "Socalistan" (Souther California), and "Mormonia" (the predominantly Mormon towns in Utah and Eastern Idaho) among them are playfully clever, but not very scientific.

Serious about privacy

But Warden is serious when it comes to people's privacy concerns, even though all the data being gathered is publicly available on Facebook's site, and can be found via Google. He says he wants to make the data useful for large-scale data analysis, but not for tracking down individuals.

"We want to make sure we don't help scammers, we don't help spammers, and we respect people's privacy," Warden said, "but also allow some sort of new insight to come out of this."

To that end, Warden has delayed releasing the data for the time being (he initially intended to release it yesterday, Feb. 9), after someone from Facebook contacted him, asking for some time to check the privacy implications.

Once Facebook clears the data for release to the academic world, Warden says he's ready to pass the task of interpreting all this data on to others and feature their conclusions on his blog more often than his own.

Meanwhile, Warden has some problems to patch in his data pipe, problems that have been helpfully pointed out by readers of his blog.

"One of the great things about getting this out there is having thousands of pairs of eyes to look over this stuff, like the fact that [the data shows] the top name in Alexandria, Louisiana is Mohamed," Warden said.

"When somebody pointed out that some of the profiles seemed to be coming from Alexandria, Egypt, that was a head-slapping moment."

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Apple intends to stay nimble on pricing of the iPad, possibly lowering prices if the newly unveiled tablet device fails to gain traction among consumers.

That was just one of the items in a note out Sunday night from Credit Suisse recounting meetings with Apple executives. Perhaps unsurprisingly, the Apple officials who met with CS analyst Bill Shope seemed to downplay the potential for some cannibalization of other Apple lines, which analysts have noted.

Apple wants the iPad to be the best device for a few key use cases. For instance, the company believes it could eventually be seen as superior to both handheld and notebook devices for browsing the Internet, using the App Store, and consuming mobile media (video, photos, and e-books). Nevertheless, in other areas, notebooks, the iPhone, or an iPod may be more appropriate. This clear segmentation of capabilities suggests that cannibalization may be less of a concern than most currently believe.

Shope also wrote that despite the seemingly aggressive pricing of the iPad the lower-than-expected price points range from $499 to $829 Apple seemed to indicate it would respond with price cuts if demand for the device wasn't revving up the way it liked. While it remains to be seen how much traction the iPad gets initially, management noted that it will remain nimble (pricing could change if the company is not attracting as many customers as anticipated), Shope wrote. Apple shares are up about 0.5%.

Interesting piece in USA Today on declining credit card use:

Credit card usage is slowing. Revolving credit largely made up of credit card debt fell by nearly 20% in November, the largest drop on record, according to the Federal Reserve, reflecting less borrowing by consumers and banks' tighter lending standards. Through October, the number of new credit card accounts was down 46% from the same period in 2008, according to Equifax.

But abandoning credit cards is a much more radical step than using them less. Consumers who don't own a credit card often have a hard time renting a car. Some hotels won't book rooms to travelers who want to pay with a debit card or cash. Those that accept debit cards may place a hold on several hundred dollars in the customer's bank account, which could cause checks to bounce. And many consumer experts say that responsible use of credit cards is one of the most effective ways to build a good credit record.

It will be interesting to see what the long term implications of this will be, because I sense a lot of people now run with the baseline perception that banks and credit card companies exist only to screw their customers.

As we noted back in December, VeriFone wasn't just going to sit back and let Square, the new startup by Twitter creator Jack Dorsey, dominate the iPhone/iPod touch payment space. Unfortunately, their announcement of PAYware Mobile looked rushed (and Photoshopped), and Dorsey himself didn't seem too worried. Since then though, VeriFone was nice enough to send us the hardware they are going to use to accept payments on the iPhone it's very real.

Today, the other key part of the equation has just gone live in the App Store, the PAYware Mobile app. This free application, when paired with the hardware, allows you to use your iPhone to easily accept credit card payments, just as Square does. Still, as Dorsey noted in the original video we took with him (second video below), Square is being aimed at a broader market of people who may not have merchant accounts but still wish to be able to accept payments. Also, while VeriFone's hardware is clearly better designed for use with the actual iPhone, Square's method of using the headphone jack is so that it will be able to be used with other mobile devices eventually (Square is currently working on an Android app, for example). VeriFone promises support for other platforms as well, but this particular hardware unit will only work with an iPhone 3G or iPhone 3GS.

VeriFone also clearly believes its solution is the safer bet for merchants thanks to its secure payment gateway. Truth be told, running transactions on this device does feel a bit safer than Square's, but there are also a range of confusing options. And setting the thing up is kind of a pain. You're also paying for this extra security. VeriFone's solution has a $49 activation fee, along with a monthly fee of $15 on top of the 17 cents you're paying on each transaction. Square gives its hardware and accounts away for free, but plans to take a small percentage of each transaction. This will be an interesting battle to watch.

Watch a quick demo of VeriFone PAYware Mobile in the video below. You can order the hardware here. And you can find the app in the App Store here.