Patently False

Cool News of the Day Little did Raymond E. Stauffer realize that all hell would break loose when he noticed an expired patent number on a Brooks Brothers bowtie, reports Dionne Searcey in the Wall Street Journal (9/1/10). Raymond is a patent lawyer and he knows an outdated patent number when he sees one -- in the case of the Brooks Brothers adjustable bowtie, the patent had expired in the 1950s. It's illegal to use old patent numbers mainly because it's considered anti-competitive, given that the practice effectively discourages others from entering a market.

The fine is nominal, just $500 per violation. But after Raymond filed his bowtie suit against Brooks Brothers, a separate ruling found that companies are liable for $500 per item -- in other words, $500 for each and every individual Brooks Brothers bowtie (there are 120 different ties) carrying a false patent. This would add up to huge numbers not only for Brooks Brothers, but also companies including Procter & Gamble, Walmart, Cisco Systems, Merck and 3M, all of which apparently have products on the market with expired patent numbers on them.

Some defendants claim it's just an oversight: "A lot of these products always have patent numbers on them, and it never occurred to anyone to take them off," says an attorney representing Walmart. Others are dismissive: "These cases have forced companies to spend time, money and resources investigating claims where there really isn't any injury to anybody," says another defending attorney. But Daniel Ravicher of the Public Patent Foundation feels quite differently about using expired patent numbers. "It chills competition, it misleads the public and takes away from the credit patent holders deserve," he says.

Innovation Machines

Vijay Govindarajan and Chris Trimble think that 3M and Google have it all wrong when it comes to innovation, reports the Economist (8/28/10). Vijay and Chris are Tuck School professors and co-authors of The Other Side of Innovation: Solving The Execution Challenge. They think 3M and Google, among others, make a mistake by expecting their workers to spend a certain percentage of their time on innovation. At 3M it's 15 percent and at Google it's 20 percent. They argue that this "let-them-loose approach spreads resources thinly and indiscriminately."

The result, they say, is "a thousand small initiatives rather than focusing on a few big problems." What's more, managers must "spend weeks sorting through the chaff to find a few grains of wheat." The authors also say it's a mistake to offer employees bonuses for fixing inefficiencies, arguing that the results are typically incremental, and seldom breakthrough. And they are against the independent "skunkworks" approach because "it ignores the basic reason for working for a big company in the first place -- to use its superior resources to supercharge what you are doing."

Their solution is to build what they call "innovation machines" that are integrated with the rest of the company and are "held accountable for their ability to learn from mistakes rather than for their ability to hit their budgets." They cite BMW for having thrown together its battery and brakes specialists to design brakes for hybrids. Allstate Insurance, meanwhile, had its marketers and risk-adjusters collaborate to create "industry-changing ideas such as accident forgiveness." In short, "students of innovation must pay more attention to big companies" because "they have the muscle to chase big prizes" and the capacity "to conquer new territories while continuing to cultivate old ones."

Pocket of Hope

Marketing chief Jaime Cohen Szulc unlocks true meaning for Levi’s. An exclusive Q&A interview by Tim Manners.

As far as Jaime Cohen Szulc is concerned, emerging media could be almost anything. It could be the Facebook “like”  buttons that Levi’s has added to every item in its online store.

It could be Gareth Hornberger, the @levisguy on Twitter. It could be Levi’s iPhone app or information about Fader/Fort, an indie-music festival.

But it could also be a Levi’s pop-up print workshop in San Francisco, stamping out decidedly non-digital posters, books and T-shirts. It could even be the economically depressed town of Braddock, Pennsylvania, which Levi’s is featuring in an old-media television advertising campaign ... read >>

Barnes' Doors

As more of its stores close, Barnes & Noble is viewed with more affection and less animosity as "a corporate bully ... that helped squash small, independent bookstores," reports Julie Bosman in the New York Times (8/31/10). "It's a community gathering space," says Monica Blum, president of New York City's Lincoln Square Business Improvement District. "I think the larger bookstores have worked hard to become those kinds of spaces." Unfortunately, it's not enough for the Barnes & Noble in Lincoln Square, which, "despite being a reliable site for readings and events focused on the performing arts," is closing.

"We recognize that this store has been an important part of the fabric of the Upper West Side community since we opened our doors on October 20, 1995," said Mary Ellen Keating, a Barnes & Noble spokesperson, in a statement. "However, the current lease is at its end of term, and the increased rent that would be required to stay in the location makes it economically impossible for us to extend the lease." Lillian Kelly is among those grieving the loss, but admits she really wasn't much of a customer.

"I love buying my greeting cards here," she says, explaining that she visits the store at least two times each week, mostly to frequent the cafe upstairs. "They're getting business out of me, I suppose," she says. "Even though I'm sitting there reading magazines for free." Roger Hawkins says he likes the store because there aren't as many park benches anymore. He says he mostly buys audiobooks, online. "I'm just killing time," says Jai Cha, who says he visits the store to read books, a chapter at a time. Barnes says its next chapter will be another store somewhere else on the Upper West Side.

Espresso Bookistas

"Even as people embrace Kindles and other gadgets for reading, bookstores are finding a market for titles printed in small custom batches," reports Dana Mattioli in the Wall Street Journal (8/27/10). "Of course the fun is being able to watch their book being made," says Barry Bechta of Oscar's Art Books in Vancouver, which "has sold about 1,500 digitally printed books since it bought a special printer in March." Barry says that people like to gather around and watch the books as they are printed in-store.

For Oscar's, and other smaller independent bookstores, the ability to print books on-demand provides a way to compete against the chains with bigger selections. Oscar's uses the Espresso Book Machine, made by On Demand Books, which "partners with Google Inc. to get access to older so-called 'public domain' titles, and with Ingram Content Group Inc's Lightning Source for in-copyright titles." The machine costs more than $100,000 and Google collects a $2 licensing fee with each book, while the fee varies with Lightning Source.

Because of the costs involved, profits are lower than with traditional books, but retailers feel it's worth it "because the store is getting a sale it otherwise wouldn't." The selection of current titles isn't exactly comprehensive, either, but the on-demand demand is good and growing: "About four percent of books are currently printed digitally, but that's expected to grow to 15 percent by 2015," according to Interquest. Some book publishers are also looking into on-demand printing, but neither Barnes & Noble nor Borders has installed printers in their stores -- although Barnes does "about $20 million in annual sales for on-demand printing."

Privacy Fallacies

"Since information helps markets work better, the cost of privacy is less efficient markets," writes Paul H. Rubin in the Wall Street Journal (8/30/10). That's the first of Paul's ten rebuttals to what he sees as "fallacies" about privacy. His point is that, contrary to what some may believe, our privacy is not free, given "a strong trade-off between privacy and information." Paul also says that the costs of privacy are not "borne by companies" because "consumers get tremendous benefits from the use of information."

He notes, for example, that Google's various free services are "all ultimately funded by targeted advertising based on the use of information." Naturally, Paul also forwards the most common anti-privacy argument -- that when ads are targeted, consumers "get better and more useful information more quickly." He further contends that the quality of those services would decline if Google didn't have the information required to "better target searches," for example. "Shorter retained search histories mean less effective targeting, " he writes.

Refuting the argument that privacy invades our personal space, Paul points out that most information is used anonymously. He says that information-based price discrimination "makes it possible for firms to provide goods and services that would otherwise not be available, "and that less privacy creates greater safety, since information is used to combat identity theft." Opt-in doesn't benefit consumers, says Paul, "since the use of information is generally benign and valuable." And he says consumers should not be irate over how their information is used, "because there is no harm from the way it is used."

Creepy Crawlers

"I understand that advertising supports the internet, but I am a little spooked out," says Senator Claire McCaskill in a New York Times piece by Miguel Helft and Tanzina Vega (8/30/10). She adds: "This is creepy." The senator is among several lawmakers considering regulations on "remarketing," or the practice of tracking consumer behavior online to serve up targeted ads. Zappos is among the most enthusiastic proponents of the practice, but it appears that some backlash may be brewing.

If you've ever shopped at Zappos, you may have noticed that items you viewed but didn't purchase show up in ads on sites -- YouTube, Facebook or MySpace -- that you subsequently visit. "It's a pretty clever marketing tool," says Julie Matlin, who found herself being followed around by a pair of shoes she had viewed on Zappos. "But it's a little creepy, especially if you don't know what's going on." Julie was even more chagrined when she found out she was being followed by ads for a dieting service.

Aaron Magness of Zappos says that's why each ad has a link to an explanation for it along with an opt-out option (which few apparently take advantage of). However, Joseph Turow of the Annenberg School says that simply telling people what's going on isn't enough. "When you begin to give people a sense of how this is happening, they don't like it," he says. And Alan Pearlstein of Cross Pixel Media, suggests it's overkill and thinks the approach could be more subtle by featuring general coupons versus specific items, for example. "What is the benefit of freaking customers out?" he says.

Archie's Empire

Archie may be 68 years old but his creators see nothing but potential in him among today's teens, reports George Gene Gustines in the New York Times (8/15/10). "I think there's been periods when you can tell that Archie comics had been written by men in their 50s," says Mark Evanier, a comic book historian. That period ended last year, when a new administration took over and began introducing storylines hinting at bigamy and characters who are out of the closet. This created buzz, and the buzz created sales.

At its peak, in the 1940s, a single Archie comicbook would sell more than a million copies. At its nadir, the 2000s, it "averaged around 2,455 copies." But the bigamy storyline (in which Archie imagines being married to both Veronica and Betty) sold 60,000, and now the comic averages about 5,000 copies per issue. Part of the success is owed to a different format -- a larger, "magazine-size publication that is part comic book, part 'Teen Beat.'" The approach played well with retailers, including CVS, Walmart, Target, Toys R Us and Barnes & Noble.

"I hate to denigrate comic book stores," says Michael Uslan, also a comic book historian. "They are wonderful, but for a kid to buy an Archie comic or for a parent to buy an Archie comic for a kid, they are not going to go to a walk-up in a bad part of town." The Archie empire is currently run by Jon Goldwater and Nancy Silberkleit, whose father and father-in-law, respectively, founded Archie comics. They envision everything from Archie apps to apparel to Broadway musicals to using Archie to promote literacy. "We're at the beginning of the beginning," says Jon. "Publishing will always be part of it, but we must morph into a multimedia company."

Collective Personality

Despite considerable research to the contrary, "Generation Y's collective personality, if such a thing exists, is not likely to be much different from other generations'," reports Benedict Carey in the New York Times (8/3/10). Much of the current research on those born after 1970 says Gen Y, or the Millennials, are "low on greatness and high on traits like entitlement and narcissism." One recent study reports that the Millennials are "more likely than previous generations to see themselves as 'an important person.'"

But some psychologists are now challenging such characterizations, in some cases attacking the way past research was conducted or interpreted. Some say that the samples are skewed because they typically include only college students. Annie Murphy Paul, author of The Cult of Personality Testing, says the tests are inherently flawed: "We should keep in mind that personality tests are themselves cultural documents, idiosyncratic products of particular individuals that say more about their creators than the people who take them," she says.

A pair of university professors, M. Brent Donnellan and Kali H. Trzesniewski, meanwhile say that narcissism peaks in young adulthood generally, and isn't specific to Millennials. However, "a widely used questionnaire called the Narcissistic Personality Inventory," finds that scores related to self-importance have "gone up significantly, at least in some college samples." Dr. Jean M. Twenge, author of Generation Me, says the most dramatic increases are among women. And then there's the question of whether the increase is necessarily good or bad, because self-importance makes some people pompous, but others purposeful.

Little Richard

He's 77 years old now and the song that made him famous turns 55 next month, but Little Richard's influence still runs strong, reports Marc Myers in the Wall Street Journal (8/10/10). "I was like the rappers today, creating dirty words to blues songs on the spot," says Richard. "One of them was called Tutti Fruitti." (video) Indeed it was, and even though the original lyrics were cleaned up, teens at the time knew exactly what he meant when he sang "about a girl named Sue who knows just what to do." Woooooo.

Released in January, 1956, Tutti Frutti peaked at No. 17. It was followed by Long Tall Sally (No. 6), and Slippin' and Slidin', Rip It Up and Ready Teddy -- Little Richard recorded "15 Billboard Top 100 hits by 1958. He also made three film appearances, including The Girl Can't Help It, starring Jayne Mansfield (video). "I had started standing at the keyboard so I could do my stage routine without having to get up," says Richard. "I also began putting my leg up on the piano, like Otis Turner." (video)

Richard was already dressing flamboyantly and wearing his hair in a pompadour, a style he picked up from Esquerita, the R&B singer who also taught him how to play boogie-woogie piano. "I wore makeup and wild outfits to keep white people from focusing on me as some kind of a ... threat," says Richard. "I knew that if I looked crazy, not cool, I wouldn't be seen that way. And it worked. People focused on the music." The affected include Elvis, the Beatles, Stones, Jimi Hendrix and Michael Jackson. "I should be better recognized today for sure," says Richard. "I am the beginning. I am the originator."

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