The Internet Killed Distance. Mobile Computing Brought It Back.

Here’s why location matters again in e-commerce.

As reported by MIT Technology Review: For retailing, the key change produced by the Internet is that shopping online spared consumers the economic costs (in time, grief, and gas money) of visiting a store and locating a product. This has been called the “death of distance.” 

When even isolated individuals can buy anything from a global marketplace, physical location does not confer any commercial advantage, and online merchants might be expected to win every battle.

But an emerging body of economic research shows that there is no independent “online world.” Physical context matters to e-commerce. It shapes our choices and tastes, and it strongly determines what we buy online. With the rise of mobile computing, these local effects matter even more.

Given how easy it is to find and buy books, electronics, and other items online, why do people continue to buy in stores at all? The reason is that online buying generates what economists call disutility: inspecting digital products is difficult, shipping can be slow or expensive, and returning products can be challenging.

Research shows that people weigh these disadvantages against the benefits of buying online. Along with colleagues Chris Forman and Anindya Ghose, I examined what happened to Amazon’s book sales at 1,497 U.S. locations when a Walmart or Barnes & Noble opened nearby. We found that customers who lived near the newly opened stores bought many fewer best-sellers from Amazon.

This means that for mainstream products, local retail options—the offline world—had large economic effects on online business. The physical environment shapes online behavior in other powerful ways. Neighbors tend to like the same music, books, and cars. Social networks are also local. Most e-mail a person receives comes from the same city, often the same building. So even though we speak of the Internet as a “place” where users “visit” websites, this metaphor falls flat when we consider actual behavior. All online behavior has an offline context.

Mobile computing strengthens the links between online and offline life. Before, online activity happened in a specific place, sitting at a desk. Now smartphones mean that wherever consumers happen to be, they can gather information online, compare prices, or buy something. Brick-and-mortar stores worry that customers might be browsing products in their aisles, but buying online (see “It’s All E-Commerce Now”).

Yet the offline environment is actually more important when consumers connect through a mobile device. With colleagues including Sang Pil Han of the City University of Hong Kong, we studied 260 users of a South Korean microblogging service similar to Twitter. What we found was that behavior on the small mobile screen was different from behavior on the PC. Searching became harder to do, meaning that people clicked on the top links more often. The local environment was also more important. Ads for stores in close proximity to a user’s home were more likely to be viewed. For every mile closer a store was, smartphone users were 23 percent more likely to click on an ad. When they were on a PC, they were only 12 percent more likely to click close-by stores.

Thus, the mobile Internet is less “Internet-like” than Web browsing on a PC: search costs are higher and distance matters more. We do not yet know how the growth of the mobile Internet will affect the balance between online and offline retailers. But it appears certain that real-world stores will do better if they can leverage the information available online, and that online retailers will need to understand their customers’ offline environment in order to succeed.

UTA Flight 772 Memorial Viewed From Google Maps

As reported by NY Daily News: Google Maps now allows people to view a memorial commemorating 170 victims of a terrorist attack the way it was intended.

Typing coordinates 16°51'53"N, 11°57'13"E into Google Maps reveals a memorial that was created in 2007 to honor 170 people killed in a terrorist attack in the Tenere Desert on Sept. 19, 1989, according to a French association dedicated to the victims.

The UT flight 772 originated in the Republic of the Congo and was headed to Paris when a bomb was detonated in the luggage area. All 155 passengers and 15 crew members died over the desert in Niger.

A French court convicted six Libyan terrorists for the attack who were convicted in 1999 in absentia because the government would not allow them to be extradited.

The victim's families organization created a memorial at the scene of the wreckage in 2007 to honor all the people who died — using some pieces of the aircraft. It is shaped liked an airplane but the full shape could not be seen at ground level. Now through the website the mosaic style memorial can be seen in its entirety.

The organization is still active and held a tribute to all of the victims ion Sept. 19 — the 24th anniversary of the bombing — in Paris. At the ceremony al of the victims' names were read and people brought flowers and read personal messages to the victims. Eight Americans also died on the plane flight, the group states.

UPS Nets Fuel Savings Using 'Constructive Dissatisfaction'

As reported by Information Week: Constructive dissatisfaction. That's what UPS calls its ongoing quest for process improvement that brought about ORION, an On-Road Integrated Optimization and Navigation system that will save the shipper 1.5 million gallons of fuel in its first year.

Formally announced last week, ORION entered beta testing at one distribution center in 2009. Eight more distribution centers were added in 2010 and by the end of this year it will be live and in production in 82 distribution centers serving 10,000 routes -- the daily runs traveled by UPS drivers. Getting to all 55,000 routes will take until 2017, but ORION started with rural and suburban routes on which the miles really rack up.

ORION builds on UPS Package Flow technology, which rolled out from 1997 to 2003 and used analytic modeling to determine the precise delivery order for packages along predetermined routes. Package Flow also set the loading plan for each delivery truck so drivers could quickly find each package.

What Package Flow didn't do was give drivers precise, optimized driving directions from point to point calculated to reduce driving distance, time and, thus, fuel consumption and wear and tear on vehicles. Package Flow was also fixed, meaning plans were set each morning and weren't adaptable. But UPS needed to support a MyChoice service introduced in 2011 whereby customers could take control over delivery preferences by setting delivery-time windows, rerouting deliveries to new locations, or asking UPS to hold packages for pickup at a distribution center.

At the heart of ORION is telematics technology, which is geospatial mapping information combined with real-time communications with drivers through their DIAD (Delivery Information Acquisition Device). Drivers now get precise, optimized driving directions on their DIAD each morning, but those directions can change over the course of the day as customers request specific drop-off times, new drop-off destinations and new pickups.

The research behind ORION began in 2003, with the analytic optimization work taking years to figure out. The models had to incorporate the expected measures of time and distance, as well as business rules for service expectations; for instance, favoring high-value commercial customers and meeting MyChoice delivery windows. The model also has to be dynamic because package volumes and delivery addresses change from day to day, so routes have to adapt for maximum efficiency.

As ORION is deployed to specific distribution centers, standard mapping data is refined with up-to-date information reflecting changes to local streets and traffic patterns. ORION also incorporates precise delivery details at each address. UPS knows, for example, when deliveries are taken at the side or back of a building as opposed to the front door.

"We take all this information and we run it against our mathematical models so that every day we can provide to every driver an optimized delivery route," says Juan Perez, UPS' VP of information services. "As the drivers are completing their work throughout the day, they use the manifest displayed on their DIAD to guide them to their stops in an optimized order and route."

UPS says its proprietary ORION algorithm incorporates nearly 1,000 pages of code and evaluates more than 200,000 ways to run a single route. The bottom line, says Perez, is a three-fold payoff in better service for customers and improved operational efficiency and sustainability for UPS. For every one mile of driving that UPS can eliminate for each driver each day, the company figures it can save $50 million each year.

UPS isn't disclosing how many miles it expects ORION to save by the end of the year or by the completion of the rollout in 2017, but Perez said it will certainly surpass one mile per driver per day. As for that 1.5 million gallons of fuel saved this year alone, that translates to 14,000 metric tons of CO2 emissions eliminated -- another step toward reducing greenhouse gas emissions.

The Brief, but Ridiculously Productive Reign of FCC Chairwoman Mignon Clyburn

As reported by the Verge: All too often, Washington, DC is a place defined more by its bureaucracy, pragmatism, and paralyzing partisanship than its ability to move the game ball forward. And frequently, the FCC — responsible broadly for our nation’s radio, telephone, and internet infrastructure — is the poster child for some of Capitol Hill’s deepest problems, torn between the needs of the people and the interests of the hundred billion-dollar corporations it’s chartered to regulate. The result is that things don’t always get done in a timely fashion. And when they do, the decisions made don’t necessarily have citizens foremost in mind.

That’s what has made Mignon Clyburn’s fleeting moment in the chairperson’s seat such a refreshing change of pace. Tapped to lead the FCC in the gap between Julius Genachowski’s departure and former lobbyist Tom Wheeler’s confirmation, she didn't just sit back and keep the seat warm for Wheeler. Instead, she used the opportunity to launch two hugely important new blocks of wireless spectrum, fix a long-running technical problem between AT&T's network and smaller carriers, and close one of the biggest telecom deals in history — all while dealing with an unprecedented 16-day government shutdown.

It didn't hurt that Clyburn was already a political insider, having been brought on to the FCC's three-person commission by President Obama in 2009. And the South Carolinian is no stranger to navigating bureaucracy both inside and outside the beltway: she’s the daughter of Representative Jim Clyburn (D-SC) and a former chairwoman of her state’s Public Service Commission.

Still, her productivity this year has been a little surprising considering the delicate, pragmatic language she used when she stepped out at CTIA in May, joking that a flight to Vegas (where CTIA was held) isn’t in line with an interim chairperson’s job to avoid risk. Yet in June, Clyburn was already jumping into action at her first commission meeting as boss, announcing licensing for the so-called H Block, 10MHz of precious spectrum in the same PCS range used by all four national carriers. (The auction for the H Block has more recently been set for January of next year.) New spectrum in a frequency range that can be readily employed by wireless carriers for broadband data is a rarity, and when the FCC announces an auction for it, it’s a milestone event. And in July, it laid down a proposal for selling off a bundle of spectrum known as AWS-3, a band that’s been in limbo since former chairman Kevin Martin tried to turn it into a pornography-free, no-cost wireless internet service several years ago.

Just days later, Clyburn’s FCC signed off on an epic three-way transaction transferring control of Clearwire to Sprint and Sprint to Japan’s SoftBank, giving the nation’s third-largest carrier the support (and cash) it needed to bolster flagging operations. That transaction eventually led to the recent announcement of Spark, a multi-band LTE network that Sprint promises could deliver speeds of up to 60Mbps. To be sure, the decision under previous FCC chairman Julius Genachowski to block AT&T’s purchase of T-Mobile USA was just as important — if not more so — but he did so in a four-year tenure. For Clyburn, the decision to approve or reject one of the largest deals in telecommunications history fell on her commission less than two months into a six-month lame duck stint.

Clyburn also oversaw the creation of new rules for phone calls that inmates make from prisons, the culmination of a decade-long fight with service providers where monopolies and a captive audience (literally) have led to absurdly high rates — rates that, as the FCC pointed out in an August ruling, prevented some low-income families from staying connected. Clyburn’s commission capped the per-minute rate for long distance from prison phones, tying fees to market rates; previously, many prisoners had been paying multiple dollars simply to make a connection. In the wake of the ruling, some providers are threatening to sue the FCC.

At times, it seemed as though Clyburn was looking to solve virtually every controversy on the FCC’s plate — a tall order for an organization that attracts it almost constantly. She sounded support for wireless customers to be able to legally unlock their phones. Under her charge, the Commission put a pause to Verizon’s controversial plan to discontinue landline service on New York’s Fire Island and replace it entirely with cellular. And, perhaps most incredibly of all, she helped usher in 700MHz interoperability, a sticky issue that has plagued smaller carriers for years.

And with just days to go until Wheeler’s swearing in to office, Clyburn oversaw a set of actions aimed at completely overhauling (and saving) AM radio, and — practically on her way out of the door — a proposal to dump federal sports blackout rules, the bane of TV-watching football and baseball fans everywhere.

Wheeler, of course, has a far longer term ahead of him as he takes over today. But skepticism of his desire to move the Commission swiftly in consumers’ favor as Clyburn did is understandably high: he comes from organizations representing the wireless and cable industries, neither of which have a sterling reputation in the public eye.

While the jury is still out on how Wheeler will shape the country’s telecom policy, Clyburn — much to the delight of many — remains on board as a commissioner until 2017. And her industrious moment at the helm hasn’t been lost on DC insiders. "In her short stint as the chair of the FCC, Clyburn worked to further the public interest and protect consumers," Public Knowledge said in a statement. "We look forward to continuing our work with Clyburn as she resumes her position as a commissioner of the FCC."

A Black Box to Track Your Vehicle's Mileage: Better Than a Gas Tax?

As reported by the LA Times: If ever there's a time for the government to track how many miles individual Americans drive, now isn't it.

Evan Halper reported Monday that state and federal officials are mulling a new approach to raising money for highway and road construction and repairs: by installing a "black box" of sorts in vehicles to measure and report the miles traveled. The owner of the vehicle would then pay a mileage-based tax into a fund for transportation infrastructure.

The idea is to find a replacement for the tax on gasoline, which faces a growing shortfall. The federal government collects 18.44 cents on each gallon of conventional fuel sold, about 83% of which goes toward road projects. (The tax per gallon of diesel fuel is 24.44 cents, almost 90% of which is dedicated to highways.) With people driving more fuel-efficient cars, however, the gas tax isn't generating enough money to maintain the buying power of the Highway Trust Fund, let alone keep up with the country's infrastructure needs.

One obvious option would be to increase the tax, which hasn't changed since 1993. But such a move seems like a nonstarter in this Congress, despite the bipartisan interest in improving the country's infrastructure.

Besides, if the goal is to make users of the roads pay for their upkeep, the gas tax isn't a well-calibrated way to do so. That's because highly efficient cars pay less per mile traveled than inefficient ones. Granted, there's an inverse relationship between a vehicle's weight and its fuel efficiency, and a direct relationship between a car or truck's weight and how much it wears down a road. But why should a hybrid version of a Ford Fusion contribute half as much per mile traveled to the Highway Trust Fund as the conventional version, which weighs no more than the hybrid?

Which brings us back to the black box idea. It's technologically possible to install a device in cars that could automatically tell the government how many miles it traveled. That data could then be used to calculate how much the driver would pay into the Highway Trust Fund.

Such an approach would not, by itself, be a perfect measure of the wear and tear a vehicle inflicted on the roads. That's because a giant recreational vehicle would be charged the same amount per mile as a featherweight Fiat 500. That problem could be fixed in a straightforward way, though, by tying the charge per mile to a vehicle's weight and other characteristics.

There are at least two larger problems with mileage-tracking devices, however. First, the public is acutely sensitive these days to government data collection, thanks to the trust-destroying revelations about the National Security Agency's prodigious surveillance activities. If the boxes measured miles by tracking a vehicle's travel via GPS, the boxes could conceivably be used by law enforcement agencies to watch someone's movements in real time, or use the information retrospectively in a search for criminal suspects. With that in mind, how eager might you be to have one of these boxes under your hood?

Second, the whole user-based approach to highway funding ignores the broad public interest in having a great system of roads and bridges. The economy depends on the efficient movement of goods from producers to consumers. Even if you never spend a minute behind the wheel of a car, you still rely on trucks to deliver food to your local grocer, packages to your door, cash to and from retailers, and so on.

In fact, every American has an equal interest in that aspect of the economy. Rich or poor, young or old, we all rely on commerce and the movement of goods. So it makes sense to pay for infrastructure in part through a levy that's broad and unavoidable.

That said, if the privacy issues can be overcome, putting black boxes in cars might be appealing as part of a next-generation funding mechanism for roads that replaces gas taxes.

GPS Forensics

As reported by the Sun Sentinel: Paul Alber can see places that most cops can't — into the past, for example.

The town of Palm Beach officer isn't a psychic, although some bad guys might swear he is. After all, he figures out where they went and how they got there.

Alber, 45, is a pioneer in a fledgling field of investigation called GPS forensics. He can extract information from GPS devices — Global Positioning Systems — and use those specific locations to punch holes in even the most extravagant cover stories.

"It's satisfying to know you've caught them in a lie," Alber says.

A former fish and wildlife officer and seven-year veteran of the Palm Beach squad, Alber said his skills are mostly self-taught. In the mid-90s, when the tracking devices first started becoming popular, he toyed with them to mark fishing and diving spots he'd visited for fun. It got him thinking.

"I noticed a lot of the data you could get out of the GPS could be really useful for law enforcement work," said Alber, who is married and has two children in their teens. "And I kind of built on it from that."

Because it can be priceless in prosecuting cases, Alber won't share details of exactly what he can dig out of the GPS units. Also off-limits is just how he pulls out information.

But investigations into crimes ranging from illegal fishing to human smuggling to boat crashes have relied on his abilities to pry electronic details from navigation devices. Although he also can track land vehicles, the majority of his work involves boats and water, mainly because he works around so much water.

Among those that have tapped into Alber's expertise: Immigrations and Customs Enforcement and the Drug Enforcement Administration, as well as state agencies in Arizona and Tennessee.

He's made some big scores using GPS devices to peer into the past.

In 2010, federal agents reached out to Alber after they stopped a suspicious fishing boat 25 miles off the coast of Boynton Beach. They found 33 people packed inside the 40-foot vessel.

A woman who claimed to be a U.S. citizen named Sandra Anderson, the boat's owner, told agents she was coming back from the Bahamas when she spotted a sinking ship, according to court documents.

She explained that she rescued 31 people from the foundering ship and helped them onto her boat.

But Alber took a look inside the boat's GPS and traced the path it had taken, starting in Bimini and heading north, then veering west toward the U.S.

"That kind of put the final nails in the coffin," Alber said.

Anderson turned out to be a Bahamian woman named Judith Moody who had seven aliases. She and the boat captain, Jesus Saavedra, had promised the 31 migrants — seven of whom had previously been deported from the U.S. — entry to the country for $5,000 a head. The two pleaded guilty to smuggling and were given prison sentences — eight-and-a-half years for Moody and three for Saavedra.

Alber took home an award from the U.S. Attorney for that bit of work, and he said he's proud of it because it took potentially dangerous people out of the country.

"They were coming here with a lot of potential to do harm and so to stop that, that's what the job's about," Alber said.

He does his navigational sluething outside regular patrol work for the police department, occasionally with compensation from whichever agency requests his help. His wife of 20 years, Pam Alber, said she's all for his kind of moonlighting.

"I think it's great," she said. "It's something he enjoys doing."

And she doesn't worry about being on the receiving end of his sleuthing: "Neither of us are doing anything we have to worry about."

Alber's boss is on board, too.

"When I get called for him to give his expertise on GPS, I get excited for him," said his supervisor, Capt. Gino Silvestri. "He's very good at it."

Alber was good at it almost from the start. In 2001, he was working a case where a boat plowed into a small fishing boat, leaving a child with major head injuries. Alber and other divers searching for evidence kept coming up empty-handed, so he took a look at the fishing boat's GPS.

When a diver went under again at a spot Alber pinpointed, he practically landed on top of a fishing pole on the ocean floor.

Now, he teaches his skills to other officers through a new class hosted by the organization that trains and accredits marine law enforcement agencies.

There seems to be no shortage of need for those skills. Anytime the journey matters, Alber is likely to get a call.

Don't Be an Easy Target for Construction Equipment Theft

As reported by For Construction Pros: When the economy took a dive in 2008, many equipment owners worried they would see an increase in theft as it became more difficult for many to acquire equipment through honest means. It turned out, however, that theft did not actually increase with the down economy. Instead, it grew as economic recovery gained momentum. Today, the National Insurance Crime Bureau (NICB) estimates almost $1 billion worth of construction equipment is stolen each year, and much of it is rented. What can you do to protect your investment?

There’s been an enormous spike in theft of rental equipment over the past two years and the reason is simple: there’s more equipment out on the job-site and that equipment is vulnerable.

Traditional equipment theft, she explains, typically happens over weekends when equipment is called off rent but left to sit until it can be picked up the following week.

“Thieves make off with the equipment on Friday night, and the equipment isn't missed until Monday morning,” DeMilio says. During that time, a machine can be moved great distances, making it more difficult for law enforcement to find and retrieve it.

“The number one thing rental companies can do to minimize their theft risk is to pick up their equipment as soon as possible after it’s called off rent,” DeMilio says. “Leaving it on the job-site over the weekend is an invitation to thieves.”

Equipment is vulnerable

Ryan Shepherd, general manager of the National Equipment Register (NER), said one of the reasons why construction equipment is easily stolen is because there isn't a title or registration associated with it, and as a result, no paper trail to follow ownership.

Various manufacturers have their own unique identification or product identification number but, overall, there’s no conformity within the industry.

In addition, unlike automobiles, which have their own unique key for starting, construction equipment is typically one key fits all. While this makes theft easier on thieves, it isn't likely to change since having an individual key for each machine on a job-site isn't practical when various operators are hopping on and off equipment all day long.

Protect your investment

If your budget allows, consider installing equipment tracking systems (telematics) on high-value equipment. In addition to monitoring its location, many telematics systems allow you to establish authorized hours of operation and/or an operating perimeter (geofence) for the machine. If the equipment is started up during non-authorized hours or leaves the geofence area, an alert is issued, warning you of the event. Some applications will automatically immobilize the equipment to prevent its use.

A simpler, less expensive approach would be to install a tracking device on each piece of equipment. Discretely located on the machine, these devices are virtually invisible and “wake up” only if/when the unit is stolen. Once a piece of equipment is reported missing, law enforcement sends out a signal to the device, which then automatically returns information about its location.

Another way to mitigate your risk of equipment theft is by registering your equipment. With no other national equipment registration program in place, NER views itself as the DOT/DMV of equipment, Shepherd says. “We’ve become the main source for law enforcement when trying to identify construction and agriculture equipment,” he says. “Registering equipment helps law enforcement identify equipment after a theft, increasing the odds and speed of recovery.”

Prevention is key

In addition to tracking devices and registration, there are several simple and proactive things you can do to minimize your risk:

• Pick up equipment as soon as possible after it’s called off rent. Don’t let it sit on a job-site for the weekend, especially if it’s a three-day holiday.
• Know your customers. Take your time and examine the accounts you’re opening.
• Ensure your customer’s credit card goes through. If it doesn't, consider this a red flag.
• Don’t accept cash.
• Know your competitors and share information about suspicious customers and bad accounts.
• Press charges when there are internal issues. Theft is sometimes an inside job. If you know the culprit, don’t let him or her off the hook.

Even the best prevention measures don’t always work, so take steps to make it as easy to recover equipment and materials as possible. Where feasible, stamp an ID number in both an obvious and a hidden area. Consider painting equipment in unique or easily identifiable colors with the corporate logo clearly visible.

Develop a list of equipment serial/product identification numbers. If possible, maintain a file of color photos and notes with other identifying information.