Pete Austin’s Blog

About six months ago (and long before the election outcome was certain) a friend of mine who is still in college was griping to me about a paper he had to write. The topic chosen by the professor was, “What does it mean to be an American?” I actually empathized with him because as soon as he told me the topic I laughed at the stupidity of the question. As I explained to him, it sounded as if the professor wanted to open a dialog about patriotism but just lacked the creativity to create a compelling question about it. I posed back to him, “I think a better question would have been, ‘Are you proud to be an American?’”

As I watched the results of Tuesday’s election roll in I thought back to that question and realized that I couldn’t remember a single time in the entire eight year tenure of George W. Bush (whom I never voted for) that I felt truly proud to be an American. It really struck me how sad it was that despite having all the advantages of being born and raised in this country, and all of the benefits I enjoy as a citizen, that I still was unable to feel proud of my country.

In the wake of Barack Obama’s resounding presidential victory, and for the very first time, I woke up this morning feeling truly proud to be an American. I finally feel as if the general populace has woken up from its ideological stupor and has suddenly seen the greater picture. We have elected an intelligent, educated, well-spoken, determined, and rational person to lead our country (Bush possesses none of those qualities). I remain hopeful that his ideas for the future will translate into a new era of prosperity in this country and that people will finally see that there is nothing wrong with having a president who is smarter than you are.

I’m not expecting President Obama to deliver miracles, but at least now I can actually hold my head high to the world.

Far and away the best photo gallery of the Obama election: HERE

In a previous post, I talked about a meeting I had with a group of Intel sales reps back at the end of June. I’ve gotten a lot of hits on it and I thought I’d post a follow-up. When we met, Intel was in full hype mode about their upcoming solid state drives and promised that they were about to change the market. Fast forward three and a half months and there have been some new developments. While I’m usually a very modest individual, I want to point out that I was right on a few points. Now don’t get me wrong here.  I’m not posting out of hubris. I wanted to follow up on this because I think it’s an indicator of greater market conditions. What’s changed is that Intel has lifted the NDA on their first solid state drive.

But I want to work my way back to that. To follow up on my mention of Seagate; at the time (pre stock market crash) Seagate Technology was (and still is) the market leader in magnetic hard drives and I mentioned that its share price looked like a great deal considering the doubt many people had about the realistic timelines surrounding solid state drive technology. Well, then the bottom fell out of the market and everything went to shit. With the economy in its current state it’s hard to see any company actually growing profits and their share prices reflect that. But are Seagate and other hard drive manufacturers facing obsolescence? Not at all. In fact, it’s leadership has just come out with revised roadmaps for 2009 restating that not only will they themselves be releasing their first solid state drives (solely focused on the enterprise market mind you) next year, but that they will continue to lead the expansion of magnetic storage technology in the form of 2TB+ hard drives. Furthermore, they have reiterated that they will be slowly releasing solid state drives into retail as appropriate in light of the fact that they are simply not cost-competitive in the marketplace. By the way, they are speaking directly to Intel with that statement. Not the other SSD manufacturers.

The next thing that happened occurred just yesterday. Apple announced its latest notebook refresh in the way of its new MacBook Pro and MacBook models. And what was the big hardware improvement for these models? Apple completely dropped Intel’s G45 integrated graphics in favor of Nvidia’s latest discrete mobile graphics. Ouch. So basically Apple confirmed to everyone what most already knew, that Intel’s latest graphics chip was not the next big thing in integrated graphics, but rather a barely adequate stop-gap that only served to allow Apple to release its previous generation of notebooks with the stellar Intel mobile CPUs it really wanted.

So we find ourselves back at the point I made almost four months ago. Intel makes simply the best processors on the planet. But they’ve strayed into unfamiliar waters of technology that some of its competitors are far more established in. Consider the following: Intel announced that it would be releasing two models of solid state drives. One mainstream drive based on MLC NAND flash and another enterprise-focused model based on SLC memory. However, only the mainstream MLC drive has actually been tested by independent reviewers, it’s still not available in retail channels, and it’s priced at $600 for a 64GB drive. To put that in perspective, it would be easy to configure a complete Dell laptop with an 80GB hard drive included for just $700. Hmm, $600 on an otherwise inexpensive component that’s not even available yet or $700 on a complete system now?

So did Intel at least get the performance of their drives in line with the hype? Actually, yes. Their mainstream MLC-based drive simply outperforms every other solid state drive currently on the market at any capacity level. Of course Intel knows this and has also priced their drives higher than every other solid state drive currently on the market. Compared to the magnetic hard drives that it is supposedly going to make obsolete, performance is very good but in many applications it’s on par with today’s fastest consumer hard drives and there have been observed performance problems with random write operations. Not exactly the stats you expect to see in a product that proclaims to be the end of magnetic storage technology.

Furthermore, you didn’t see RAID results included in the reviews. Why does that matter? Because many business systems rely on RAID to provide protection from data corruption and drive failure. The price of these drives is already a sticking point. If the RAID performance is no better than current technology at a fraction of the capacity, you can expect business customers to look the other way.

The bottom line, Intel needs to pull back on the hype and modestly release their solid state drives. Solid state drives will have their day. The performance speaks for itself, but whatever level of success they achieve in the market will show you exactly where the technology is positioned and how it will fare against a very scalable magnetic storage technology.

As a footnote: remember the example we all hear about how computers that used to be the size of an entire room are now the size of our iPhones? We are fast-approaching the day when technologists will say, “Enterprise SANs that used to fill half of our data center, now resides in just 4Us of rack space.” Magnetic storage technology will be how we get there.

If you watch the news at all, you saw today the collapse of two more financial institutions amidst the mortgage meltdown. Both Lehman Brothers and MerrillLynch went under today. Lehman Brothers to bankruptcy and Merrill Lynch in a forced sale of the company to Bank of America. These two join countless other victims of the mortgage industry collapse. You may have heard of the other big-name institutions but rest assured that many many other small/medium financial and mortgage companies are going under due to their exposure to the subprime market. I can’t give the whole story of what happened in the mortgage industry here – I just don’t know enough about it – but I would like to share a story that is very closely linked to the financial disasters we’ve been seeing lately.

In late 2005 while living in Miami, I began working in the IT department of one of the nation’s largest homebuilding companies. This company did business and built communities in 13 states around the country, and at their peak had almost 12,000 employees. Early on things were great. Homes were selling, the real estate market was hot in almost every metropolitan area around the country, investors started to dive headlong into properties in need of a little work in hopes of turning them around for a quick profit. Even television producers got into the act and throughout 2006 the top-rated shows of HGTV, TLC, and other similar networks were about “flipping” real estate. But something was very wrong with the economics of this latest real estate buzz. It simply wasn’t sustainable.

Throughout 2005 and the first three quarters of 2006 things were great at this company. Revenues were up, profits were up and morale was high. But then something started to happen. As part of the IT team I presided as the on-site tech for many of the management meetings that brought together regional managers from territories around the country to Miami to meet and discuss the state of the company. At one of these meetings in the Fall of 2006, managers began to stand up and describe slowing sales in their area and concern that prices were inflated.

These meetings were generally run by the company’s CEO and CFO, and as the conversation went around the room, the regional managers would give a short description of themselves, their sales area, and the state of business there. Many managers got up and spoke to slowing sales at which the CEO simply scoffed at their lack of salesmanship and continued to repeat the idea of more creative ”incentives” - which would later become the craze of homebuilders nationwide as a hail-mary idea to bring in buyers. What struck me was the level of sarcastic arrogance by the executives to the national market conditions and where they seemed to be heading. In their minds, it wasn’t the market’s fault that sales were slowing it was the fault of sales managers for not being able to create a convincing arguement to buy.

The one manager that I specifically remember was the regional vice president from Las Vegas. When it was his turn to speak he stated how Las Vegas real estate has undergone explosive growth (much of it through investors and speculators) not much different from what Miami real estate seemed to be experiencing. His question was whether the company executives were concerned about the level of growth as a possible “real estate bubble”. The CEO snapped back at the manager, “I keep hearing this talk about a ‘bubble’. I don’t want to hear it.” He pointed to the CFO and called to him, “..what do we say about the ‘bubble’”? The CFO shot back almost laughing and he said, “Bubble Schmubble!” The CEO echoed him, “That’s right! Bubble Schmubble!” It sounds corny, and it was, but what you have to also know is that the phrase was a part of the company’s propaganda hung in and around the headquarters on posters. It was designed to ingrain in employees that despite all common sense, the idea of a real estate bubble was actually nonsense.

I left the company in early 2007 when I moved to Seattle. As I left the markets were beginning to see that very earliest signs of mortgage troubles. In the months immediately following my departure the company’s stock price dropped nearly 40% as the fallout began, massive strings of layoffs occurred, and morale nose-dived. Looking back on that meeting it still blows my mind how dismissive the top executives of the company were to the concerns of managers who were right there, in the very markets being hit, and raising real concerns. It was a scary level of detachment from the everyday business of the company that does nothing but reinforce to me the commonly held belief that executive compensation is egregiously high. These executives rode a waveof market-indifference straight into the ground. The company’s stock now sits below $14/share and has taken billions of dollars in write-downs and losses since that prophetic meeting. It’s number of employees has fallen to below 4000 and sadly the Las Vegas market that inspired the CEO’s phrase has experienced arguably the largest collapse of real estate in the nation.

Update: In light of a report issued on February 19, 2009 I’m not holding back the details of this story any more. You can read the report here. The company I worked for was Lennar Corp. whose shares are now trading below $6. Wall Street executives have been the target of investor ire for both their excessive compensation packages and reckless abandon towards running their companies. The leadership team of Lennar was no different then these Wal Street firms’. The above story is just one of many examples that have convinced me that the current state of our economy is the result of blatent greed and indifference of those in the financial and real estate industries. In many ways I regret my former association with these people. I have since returned to working in the non-profit sector and could not be happier with my work.

 If you’re like me you’re probably channel-surfing between CNN and the other new networks watching the coverage of hurricane Gustav as it approaches the Gulf Coast. As someone who lived in Miami for eight years and went through many hurricanes, including the record 2005 season, I can attest to the hype surrounding Gustav. It’s refreshing to hear the media taking this category 3 storm seriously. I’m sure some people think that he media is being overly dramatic about the storm and sensationalizing - so I thought I’d share what is probably my favorite picture from the record breaking 2005 hurricane season. The damage you see in the picture if from hurricane Wilma which was actually the strongest (in terms of pressure) hurricane ever recorded in the Atlantic basin. When it passed through Miami and Ft. Lauderdale it came through as a very strong category 3 (almost a category 4) storm. While the hurricane intensity scale goes up to five, it’s important for people to know the kind of damage that just a category 3 storm can do. New Orleans and the rest of Louisiana is in for a rough ride.

The building above is an office building in downtown Miami. While it look like the damage is isolated to the top floors I can assure you that the damage continues down the building blocked by the other building in the foreground. This happened to be the most devastated building in downtown but countless others were damaged in similar ways. As we walked around downtown immediately after the storm we found every street in downtown Miami covered in 1-inch thick skyscraper window glass that had been blown out of Miami’s skyline. It took more than six months before most building windows were replaced and more than a year for all of downtown Miami’s building to return to their normal appearance.

Update:
Gustav has since made it’s run through Louisiana, and now Ike has hit Texas also as a category-2 (borderline category-3) storm. If you pull up pictures of the Chase Financial tower in downtown Houston, it’s eerily similar to my pic from Miami. A hurricane does not have to be a cat-4 or 5 to do severe damage.

I was watching CNN last night and they were covering the endorsement of Barrack Obama by Al Gore. The CNN anchor was posing the possibility of Obama choosing Gore as his VP to a panel of political pundits. This notion was unanimously panned by the panelists so then the CNN anchor pressed further and offered the possibility of a cabinet-level position for Gore, namely that of Energy Czar. The panelists dismissed that as well citing that Mr. Gore is more than content in his current endeavors and having already been VP would not settle for anything less than a presidential role. The idea of putting someone like Al Gore in a Energy Czar role got me thinking about broader energy policies of the next American administration.

A lot of people are really caught-up in the politics of the energy industry right now, driven almost exclusively by the price per gallon of gasoline. If you take a step back and look at the bigger picture the price of a gallon of gasoline is such a small component of the energy industry you wonder how it ever got to be such a big deal. The energy industry encompasses method of producing energy that we as a civilization know of. There’s renewables such as solar, wind, and hydroelectric and then there’s comsumables such as coal, oil, and nuclear. Now I’m not an environmentalist or a member of Greenpeace; I am however a capitalist – through and through. And I’m telling you that the new economic boom is coming in the form of renewable energy infrastructures.

If you think about any sovereign nations’ energy policy, there is a holy grail of sorts. Energy independence. Having a diversified energy policy that your citizens can both afford and feel secure in in times of crisis is great, but what if your larger economy suffers at the cost of it. The ideal energy-independent policy would be one that holds the above benefits but betters the economy by keeping the cycle of buyers and sellers within its own borders. If you want to see how other countries are achieving energy independence just look at Iceland and Brazil. Iceland in particular has developed a solution of energy production that makes our supposed “American Ingenuity” look like the retarded offspring of George Bush and Brittany Spears…wait a minute.

Energy independence isn’t about completely closing off a nation’s energy trade as most critics like to argue, it’s about producing 99.9% of the energy that the country needs both currently and in the future using your own natural resources – whether they are renewable or not. The bottom line is American politicians just don’t know how to commit to anything other than pandering to our own citizens incompetence and aggression to other nations. If a politician were to come along and run on a platform of change – I present the ultimate challenge. Commit to creating an energy-independent nation in the course of a single administration (8-years with reelection) using a hybrid energy policy of renewable and consumable energy. If America’s people and leaders could commit to a challenge like this image the benefits. Imagine the centuries of prosperity that could come of just 8 years’ commitment. Stop thinking about energy 15 gallons at a time. Take a step back and see the greater challenge.

So perhaps if you ventured into my little corner of the Internet (and you actually know me) you’re wondering why I would go and do something as vain and cliché as create a website for myself (with my name as the url no less). To which I would say that it’s no more vain and cliché than buying anything produced by Apple and parading it around with a sense of entitlement and superiority – but I digress. Truth be told, this website is my attempt at reestablishing my presence on the Internet. While I was in college one of my CIS classes required that you create a website for yourself which was then hosted on the school’s webserver dedicated to student pages. The great thing about this was that for some reason Google indexed these student pages the way an ivy-league grad student is recruited – highly. So, with almost no effort or cost my school webpage became the #1 search result for Pete Austin which of course made me “the most important Pete Austin in the world”. This was great because apparently there’s a video game developer in Britain named Pete Austin who gets a fair amount of industry press coverage and usually ranks higher than me. So ranking higher than someone who is actually recognized in the media for his work gave me a strange sense of accomplishment and self-importance.

Before you judge me for that, Google yourself and then tell me that it isn’t infuriating to see Google claim that all the other people with your exact same name are somehow more relevant to the world than you yourself. Yeah, I thought so. Which brings me back to my own motives. Upon graduating from college I was surprised to find that my student webpage was not automatically removed from their servers, but rather it remained online and ranked just as highly in most search engines. Unfortunately, in 2007 and after five years of free web-hosting on my alma-mater’s dime they completely overhauled the student pages webserver and simultaneously purged all non-current students’ pages.

The other thing that a blog grants me is time saved from trying to manage my profile and communications accross the different social networking sites, (Facebook, MySpace, & LinkedIn) thus the tagline. It’s sort of fun to try and track down old high school or college friends to try and digitally renew your friendship. But let’s face it you never really talk to them and about two weeks later the novelty has worn off. I’m done with social networking sites.

So here I am, back online again on my own terms. I guess maturity has stripped me of my desire to be “the most important Pete Austin in the world” but if you’re curious to read about what’s going on in my head and life – here you go.