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Dana Blankenhorn

 
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  • What Will Become of AT&T and Verizon as Copper Dies? [View article]
    Google only uses the last mile of the phone network, where government has allowed a duopoly to continue despite changing technology. The idea that Google is "stealing" something Verizon "paid for" is also nonsense, since Verizon "paid for" it through monopoly rents from captive customers, under government authority. In other words, we paid for it.

    Verizon has taken that regulated monopoly money and, rather than improving the bulk of its plant, thrown it into mobile. The result is the last mile of the U.S. Internet is its weakest link and hampers our ability to compete with the rest of the world.

    That last mile needs to transition from voice with some Internet to all-Internet. And the regulatory structure needs to change so that many companies can profit from that change, so that Verizon is wholesaling capacity rather than taking monopoly rents.
    Jun 26 01:04 PM | 1 Like Like |Link to Comment
  • Why Google Should Buy Netflix [View article]
    I don't think corporate transformation is as easy as you (and googlist) seem to think it is.

    It's not as easy as hiring a few people and doing a few deals. If it were AOL would be a content monster by now.

    Netflix does have some knowledge of markets and the content space that is incredibly valuable. I don't begrudge them that. Some do, I don't. They also have built some infrastructure of their own which has value.

    But I do think the value of all that may degrade over time if the companies you mention all make major efforts in the space. At that point having cheaper infrastructure will matter a lot more than it seems to matter today.

    That's my view and others are perfectly free to disagree.
    Jun 25 03:18 PM | Likes Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    The beauty of what I call a "War Against Oil" is that it's a fight everyone can win. Japanese technology is pretty amazing. Chinese production power is pretty amazing. So it American ingenuity.

    No one has to lose in this. There is plenty of market for everyone.
    Jun 25 03:14 PM | 1 Like Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    I think you're missing an important point. You write "You're not going to raise the necessary energy needs of the world in 10 or 20 years."

    In order to create an economic stimulus, we don't have to do that.

    As I said, you get an enormous stimulus from each "gallon" of renewable energy you create. The jobs to create it. The energy itself. The replacement of that energy on the market.

    The last is the key. Once you are creating enough renewable energy to just capture the excess demand, and send aggregate demand down, you start to create downward pressure on other energy prices.

    The psychology is powerful, as any economist will tell you. If you think your asset is going to decline in value over time,rather than increase, you're going to bring as much of it to market at the current price as you can.

    One of the big reasons for high energy prices today is simple hoarding. Those who control reserves assume the value of what's in the ground is going to go up over time.

    Break that, keep it broken by continuing to create renewable energy at an accelerating rate, and the whole economic psychology shifts from scarcity to abundance.

    The idea that everything has to be renewable by date X or we shouldn't emphasize it today is a straw man. You only need enough renewables, and enough growth in renewables, to convince the energy markets that what they're hoarding is not going to increase in value over time.

    How much is that? Probably not much because, as I noted, the cheap renewable energy lies in cutting demand through other means. Better engines. Insulation. Better bulbs and energy infrastructure. There is tremendous return on investment to be had on all these things, so that in the early years of renewable supply doubling you can start to impact market psychology through simple conservation.

    Which we can do more of than anyone else.
    Jun 25 02:13 PM | 2 Likes Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    There are many alternative technologies available for storing excess energy for use both on-and-off the grid.

    One of the most intriguing aspects of this whole thing, of course, is what may happen in places that don't really have a grid now, the economic possibilities offered by having "mini-grids" in the developing world.

    Consider the idea of a mass market for mobile traffic in Botswana, Tanzania, or Nigeria, with WiFi and cellular used to link with phones that are themselves recharged through solar power.

    You're essentially putting in reliable broadband Internet links into places that had been stuck in the 17th century in many ways. Which opens markets, both supply and demand.
    Jun 25 01:07 PM | 1 Like Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    It is cost competitive in many places, and it is being used. But you're begging the question -- how do we create policies making it more cost competitive in more places, so it's used more?

    Once you start asking that question, your view starts to change.
    Jun 25 01:04 PM | 2 Likes Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    I agree. I think one reason solar stocks aren't zooming is because people remember history. You can say "if you had invested $100 in X industry 40 years ago you'd be rich" but where would it have been invested -- probably in a lot of stuff that went kaput.

    I've concluded that government fiscal and monetary policies are irrelevant to our present problems. The equivalent of a "war" footing against oil -- aimed at breaking our dependence on fossil fuels -- holds a lot more promise, as a policy, of getting us to where we want to go, which is abundance and prosperity.

    Unfortunately we have people like Al Gore "selling" that through fear. Fear doesn't create change. Hope does.
    Jun 25 01:03 PM | 2 Likes Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    There's enormous money available to be saved on installation. And permitting. And approvals too. You're right. And as we create standards for permits, approvals, fees, panels, and installation hardware, the effective cost of a solar panel goes down.

    Remember, too, that panels are not the final outcome here. Thin films, and solar systems baked into building material, don't require panels for installation.
    Jun 25 01:00 PM | 1 Like Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    Yes, but each "gallon" of oil you replace has several impacts on the economy. There's the labor involved in the devices that replace the power. There's the power itself. And there's the downward pressure on prices created by the power replacement.

    You can get similar impacts through simple efficiency, and America has more of that "cheap" power than anyone else. Keep carbon energy prices high enough so replacements move forward, and very shortly you will be able to knock that price down safely with no impact on the renewables market.

    As the cost of renewables declines, you add more pressure to carbon prices, and at some point you reach a tipping point where carbon owners decide it's in their interest to get what they can rather than wait for the value to fall further.

    That's the economic goal, because once the back of the oil power is broken -- once the link between growth and oil prices is broken irretrievably -- that's when you get real prosperity.
    Jun 25 12:58 PM | 1 Like Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    I plan on creating something titled "the renewable stimulus" in the next few days. I am not certain what companies to tie it to, or if the editors would run it as I want it run. So I might wind up putting the whole thing on my personal blog at danablankenhorn.com and creating "aspects" here reflecting what it means to various publicly-traded entities.

    Thanks to everyone who has commented, by the way. It's unusual for me to see such heavy activity on a Saturday morning. Y'all have made my day.
    Jun 25 09:45 AM | Likes Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    In addition to using heated salt, there are many other ways available to store-and-forward solar power for use at night.

    One of the easiest (although right now more inefficient) is to turn excess power into hydrogen during the day and use that hydrogen to run fuel cells at night. The fuel cells combine the hydrogen with ambient oxygen to create a form of pollution called water.

    This would provide an immense benefit to desert-based power systems. You produce the hydrogen by the sea, and put the fuel cell back-up inland.
    Jun 25 09:44 AM | 1 Like Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    You can get a tan on a cloudy day. There's solar power coming through the clouds. We've already seen the development of systems, using molten salt, that continue generating long after the Sun goes down. The effective power coming to a solar grid can even be substantial in wintry climates like Scandinavia.

    The old wives' tales aren't entirely true.
    Jun 25 09:41 AM | Likes Like |Link to Comment
  • Why Solar Power Is Booming but Solar Stocks Are Not [View article]
    I think one reason FSLR trades so high is that they have proven the ability to scale their current technology, and to produce power at a low price. There is also something to the idea that they're the only American "winner" here and therefore "deserve" support.

    But investors in the stock have not done well recently. These things tend to self-correct.
    Jun 25 09:40 AM | 1 Like Like |Link to Comment
  • Why Google Should Buy Netflix [View article]
    I don't think they should. I think they should pay $10-12 billion for one. Because Netflix knows things Google doesn't, about mass marketing, about getting money out of consumers, about negotiating with rights-holders.

    Netflix could be the means by which Google turns its Internet into cable.
    Jun 24 10:49 AM | Likes Like |Link to Comment
  • Why Google Should Buy Netflix [View article]
    I said at the end of the piece it's unlikely Google would want to buy Netflix now, when the public gives it a p/e of 77. But its technical difficulties are well known, they will eventually be discovered by the market, and at that point I think the company will be a bargain. Google is best-placed to be a buyer because their advanced Internet infrastructure would drop Netflix' costs and thus deliver immediate profits.
    Jun 24 10:48 AM | Likes Like |Link to Comment
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