More numbers

After doing the math on the number of combinations for randomly generated passwords, I thought about TinyURL, a great service that's been around for a long time. You enter any really long URL, and it creates a short one like http://tinyurl.com/XYZ that redirects to the original URL. It's a pretty simple solution, but seems very cool nonetheless.

I've always wondered if they were going to run out of tiny URLs, until I did the math. Assuming 5 character URLs only made up of numbers and lowercase letters, they can create 60,466,176 URLs. Add uppercase letters and that's 916,132,832 URLs. According to the website they have over 20 million URLs right now, so they have a way to go.

A slightly different math problem, in an episode of Thief last season, the main character was trying to crack a safe with a keypad. He used UV light or a spray or something to show which numbers had been pressed most frequently (don't they do this in every safe cracking show?). There were four numbers used in the combination, and the safe had a defense mechanism where after three attempts you couldn't enter any more combinations. This was supposed to add a lot of tension to the moment, but the main character was steadfast in his belief that he could guess the right combination.

I couldn't help but do the math. There are only 24 possible combinations in this scenario, which sounds good at first, but that means you only have a 12.5% chance of getting the right combination before you're stuck. If you're playing Texas Hold'em, you have a better chance of beating a pair of aces preflop with kings, or even 3-2 offsuit. And you've got right about the same odds of cracking that safe as beating a pair of aces with 7-2 offsuit.

Maybe that just tells me I should be playing 3-2 offsuit more often.

Net neutrality

One of the effects I've experienced from thinking a lot more about the Enron case is having a greater suspicion that corruption permeates our government. It's hard to ignore the hand that the government had in providing the Enron (and other companies) the means to take advantage of Californians, and their unwillingness to act against Enron while they watched the pillaging occur. Not that I've ever been Pollyanna about government, but I've always tried to start by giving officials the benefit of the doubt.

The first thing that comes to mind in this light is the fight right now over Net Neutrality. The short of the issue is that telecoms (AT&T, Verizon, Comcast, Time Warner, etc.) are starting to abuse their control over delivery of content via the Internet. They want to start setting subjective pricing for companies that provide services over the Internet, and control which sites load faster than others.

For example, if Time Warner decided they wanted to create a service to compete against one of mine, they could ensure that my site uses the "slow lane" while their site loads quickly for users. That is, unless I wanted to pay out the ears for my site to use the "express lane". This goes far beyond me paying X dollars for each Gb of transmission where I pay more for 10Gbs than I do for 5Gbs.

You can learn more about the issue at SaveTheInternet.com. A couple juicy tidbits from their FAQ that shows you what could become commonplace if the telecoms move full steam ahead:

  • In 2004, North Carolina ISP Madison River blocked their DSL customers from using any rival Web-based phone service.
  • In April, Time Warner's AOL blocked all emails that mentioned www.dearaol.com — an advocacy campaign opposing the company's pay-to-send e-mail scheme.

Earlier this month an amendment to prevent the telecoms from doing this was voted down in Congress. Why? Was it because Congress really felt that allowing the telecoms this freedom is good for American citizens and the growth of business? Or was it because the telecoms spent millions of dollars lobbying Congress to defeat the amendment? Isn't it apparent that these telecoms will profit considerably from holding companies at ransom, at the expense of stifling Internet entrepreneurship? Why is this even remotely acceptable?

The fight goes to the Senate right now. There are some people in government who aren't puppets of big business. Let's hope there are enough.

The smartest guys in the room

This weekend I watched The Smartest Guys in the Room, a documentary about the Enron scandal. Even though I knew the basics about the scandal, I still appreciated the in-depth look at the major players in the case, and a lot of the little details I missed when reading about it in the news. I highly recommend it for anyone remotely curious about the details in the case. Even my wife and sister found it interesting, and they wouldn't classify themselves as business geeks in any way. (There sis, I mentioned you in my blog. Happy?)

The documentary stimulated a lot of thought from me over the weekend. In some ways, the Enron case is old news, but many of the lessons are still relevant. Here are a few of the things going through my head about the case:

Disgust

It's disgusting to watch how Enron leaders blatantly deceived employees and investors. Cut from a company meeting where executives encourage employees to invest 100% of their 401K in Enron to the lineman talking about how he watched his 401K tank from about $350,000 to $1,200. How leaders froze employee accounts so they couldn't cash Enron stock at the same time that they dumped their own stock to the profit of millions of dollars. How Enron traders joked about how much money they were making from California wildfires and hoping the state would just fall into the Pacific. How traders called up power plants instructing them to shut down in order to run up energy prices while small business owners were forced to close shop and poor citizens went without heat. And so on.

Fear

I think it's scary how many people were involved in this scandal, and how apparent it is that this kind of corruption is probably behind the scenes in a lot of companies today. Think about the politicians that voted to deregulate the energy market in California in a way that benefited companies like Enron. Or the state and national administrations that sat by and did virtually nothing while Californians were taken advantage of. Or the accountants and auditors that approved Enron's cooked books every quarter. Or the lawyers that helped Enron set everything up. Or the stock analysts that were in Enron's pocket. Or the banks that helped Enron finance obviously shady deals. The news has focused on Lay, Skilling and Fastow, but there were hundreds of other players involved that are doing business as usual today.

Curiosity

Admittedly, the documentary is very much one-sided. Not that I would trust anything Lay, Skilling, or Fastow say publicly about the scandal, but they're the only ones who can answer one of the biggest remaining questions — where did things go wrong? The documentary touched on it somewhat in discussing whether people do bad things because they're inherently bad people, or because they slowly get trapped into a cycle of doing bad things and get out of control. I tend to believe that the latter's closer to the truth, and that Lay started the company decades ago with more noble intentions.

But if that's true, then could most business owners get trapped into the same cycle of greed and deceit? How easy would it be to convince yourself to employ "creative accounting" to smooth out the numbers while under intense pressure from investors? How many of us really have that in us?

The business of ice cream

My brother and I were recently sitting in Cold Stone Creamery respectively enjoying Birthday Cake and Devil's Delight concoctions. While everyone else was talking about what we were going to do with the rest of the evening, he turned to me and asked, "what do you think their margins are?"

Being the purveyor of hot air that I am, I instantly responded with all sorts of answers as if I'd been studying the balance sheets of ice cream retailers for years. We both proceeded to think deeply about the profitability of the store as if the owner had presented us with a business proposal, not a credit card receipt.

Let me pull you into the conversation with such intriguing ice cream industry questions such as:

  • Why is there always a long line at Handel's, even in the middle of winter.
  • Why does Ritter's close during the winter, and how does this affect their profitability?
  • Why does Dairy Queen sell hamburgers?

It's probably a sign that you have a businessman living inside of you if you'd rather the manager talk to you about sales figures than give you an extra scoop of ice cream. But it's not like I'd turn down the extra scoop.

Obsolete

One of the things that worries me is that one of the big guns like Microsoft, Google or Yahoo will announce a product that competes head-to-head with one of my mine, or makes a move that otherwise makes mine obsolete in some way. It's nothing that I lose sleep over, but something that crosses through my mind from time to time, as I'm sure it does every small business owner.

Along these lines, it saddens me to see that the perfect website might now become obsolete due to a recent announcement by ABC. Of course, this isn't to say that the website couldn't be quickly re-tooled to answer the slightly different question that I will now ask each week.

And isn't being able to turn on a dime the beauty of having a small business? It's the ace up our sleeve if the new Microsoft decides to task a few dozen programmers and marketers with crushing us. No board meeting to schedule, committee to form, or bean counters to run the numbers by — just tweak the right things and go. Or is that just what we tell ourselves?