Innovation Science

Thinking About Sound

A complementary article on the research that our research center is doing on cognition and hearing was recently published at HealthyHearing. Part of the research is being conducted by Tassos Sarampalis and Erv Hafter at UC Berkeley—I wish the reporters had interviewed them as well.

Here are some passages from the article:

Engineering has taken hearing aid technology to its current high standards. However, even though 91% of all hearing devices are digital, offering improved sound quality, Edwards is quick to point out that hearing impairments still lead to slowed speech communication, diminished access to the environment and others, limited hearing and interpretation of non-speech sounds, the loss of spatial hearing and selective attention issues that impact cognitive development.

Thus, there is a need for hearing science to take a more active role in the development of the next generation of hearing aids – devices that not only improve hearing, but also better facilitate the cognitive processes once sound input is delivered to the brain.

Indeed, hearing aid technology has made major strides in the past decade and we can anticipate that improvements to existing devices will continue to be made. We can also look forward to technological advancements that improve cognitive activities in hearing impaired individuals.

Supreme Rulings on Innovation

The Supreme Court ruled this week on a case that impacts past and future patents while also commenting on the nature of innovation. I’ll get to the innovation part in a second.

Briefly, the Court threw out the previously used test for whether an invention was obvious or not. Most new ideas do not pop out of the air but are combinations of two or more disparate concepts that, when put together, create something new. One of the most critical questions before patent examiners and patent trial judges has been whether this new creation is nonobvious. A patent attorney that I used to work with explained the concept of nonobviousness by holding up a pen and saying that his pen has never been made in the color chartreuse, so such a pen would be new/novel but would also be an obvious modification of currently available pens—there would be nothing nonobvious about it. A chartreuse pen would not elicit a, “Wow, how did you think of that?” response.

In a nutshell, this week’s Supreme Court ruling makes it easier to denote an invention as obvious. One interesting aspect of the ruling for this blog is that the language of the Court ruling speaks to the definition of innovation. Several blogs on innovation, including this one, have attempted to define what innovation is and is not (see the left column of Broken Bulbs, for example). Surprisingly, there is disagreement on the matter, with some people claiming that an invention must be successful in the marketplace in order for it to be innovative. I’ve argued against that definition.

One can look at quotes from the Court’s ruling to infer the judges’ opinion on what defines innovation.

Justice Kennedy wrote,

Granting patent protection to advances that would occur in the ordinary course without real innovation retards progress.

Here he says that innovation is more than just the “ordinary course” of development of something new. Now, how one differentiates an “ordinary course” from an “extraordinary course” is another matter (presumably, one has to rely on the expert opinion of someone knowledgeable within that field of technology).

Interestingly, the court also wrote that ordinary innovation is not entitled to patent protection because it “does no more than yield predictable results.” So, what exactly is ordinary innovation? My best guess is that it is synonymous with the more commonly used term incremental innovation which is differentiated from radical innovation. The former is the common process of improving a product or process through regular R&D development and results in small and predictable improvements. The latter requires creativity and produces unanticipated inventions, resulting in often dramatic changes to product or process performance and often gives the inventing company a significant competitive advantage.

Other sources offered their opinions on innovation in this case. According to the New York Times,

Pharmaceutical and biotechnology industry groups…argued that innovation would suffer if patents became too hard to defend.

This argument was against the Supreme Court’s final decision, which will make it easier to file invalidity claims against issued patents. The biotech industry was worried that if straightforward tests for determining obviousness were eliminated, then innovation programs would be difficult for companies to justify because of the potential for increased uncertainty in issuance and litigation risk. This is counter to many recent arguments that the current state of patents has stifled innovation by creating such a minefield of potential litigation that companies have difficulty doing anything without infringing on weak patents and potentially facing frivolous litigation.

In contradistinction to the biotech group, Microsoft and Cisco filed a brief that was in support of how the Court finally ruled, stating bluntly, “The Federal Circuit’s current test for obviousness hurts innovation” and “has had a stifling effect on true innovation.” Their argument was simple:

Defensive, large scale patenting drains resources away from real innovation: scientists and engineers must spend time working with lawyers and patent agents to file patent applications where their time would be better spent on product development and research.

In their decision on this case that included discussion of obvious innovation, as discussed above, the Supreme Court seems to be aligning the legal assessment of patentability with the concepts of incremental vs radical innovation that have been developed over the past decade. There’s no doubt that the Court accepted the case due to their frustration with the current state of patents (given the unanimous decision, any guesses if the judges are all Blackberry users?), but it’s interesting to see their decision’s collateral contribution to the innovation discussion. I would say that this Supreme Court decision solidifies Innovation as the key business concept of this decade.

I will leave the final words of this post to the following three quotes on innovation from Justice Kennedy in the opinion of the court:

…When there is a design need or market pressure to solve a problem and there are a finite number of identified, predictable solutions,
a person of ordinary skill in the art has good reason to pursue the known options within his or her technical grasp. If this leads to the anticipated success, it is likely the product not of innovation but of ordinary skill and common sense.

This is so because inventions in most, if not all, instances rely upon building blocks long since uncovered, and claimed discoveries almost of necessity will be combinations of what, in some sense, is already known.

We build and create by bringing to the tangible and palpable reality around us new works based on instinct, simple logic, ordinary inferences, extraordinary ideas, and sometimes even genius. These advances, once part of our shared knowledge, define a new threshold from which innovation starts once more. And as progress beginning from higher levels of achievement is expected in the normal course, the results of ordinary innovation are not the subject of exclusive rights under the patent laws.

 

The Physics of Pricing

The Associated Press had a great article that I read today (in the SF Chronicle) on the use of advanced mathematics to help determine product pricing strategies. So-called price-optimization tools from companies such as Khimetrics (acquired by SAP) and Zilliant analyze massive amounts of historical sales data to find clues for better pricing that would be difficult to discern without their sophisticated models. (These software systems cost in the 7–figures—assuming that Khimetrics&Zilliant apply their own analysis to their own pricing in a kind of post-modern self-reflexive business analysis, their customers must be hugely self-conscious about the “optimization” of their bill).

This whole field of analysis in part began, according to the article, when Khimetrics’ founder, Ken Ouimet, was studying complex systems in a university Physics department and he epiphonied (which should be verb) that shoppers have no more sense than a hydrogen atom (or something like that). Next thing you know, mathematical models developed to simulate the motion of atoms in gas are being used to model the purchasing behavior of beer-and-Doritos-buying consumers.

The article and its sidebar have several interesting examples of the successes  of these systems. The systems determine, of course, which products have price elasticity and which don’t. That’s not necessarily difficult for experienced retailers to figure out. What is difficult is to fine-tune pricing on a huge inventory of widely differing categories of products with barely discernible differences within categories.

What’s even more interesting is their analysis of relationships between products and subsequent recommendations to exploit correlational behavior. Beer drinkers, for example, will pay careful attention to price when buying their brew (“10 cents cheaper? Mickey’s Big Mouth for me!”) , but will snatch up snacks to go along with the beer with little concern for cost. So, drop the margins on beer and crank them up on Cheetos—balance this adjustment correctly and you’ve just increased your bottom line.

And guess what? Those consumers care even less about price during big sporting event weekends—turn the pretzel-price up even higher during NCAA Tourney action! Increase the price of mint leaves during Kentucky Derby weekend and you’re golden. Who would have thought that sophisticated mathematics could improve the profitability of such unsophisticated businesses as Safeway’s and Albertson’s.

Personalization/Individualization is a consumer theme that has hit practically all consumer markets, with the extreme perhaps being the ability to completely customize your Nike shoes online so that no other shoe in the world is identical to the pair that you buy. This is normally viewed as empowering for consumers: a good thing.

Consider now the logical continuation of price-optimization. With store cards (e.g., Safeway cards) that people use to take advantage of item discounts, companies are amassing large amounts of personal information that can be correlated with buying habits. Cross-correlate this data with other databases that can be purchased from other sources, and the ability to personalize pricing becomes incredible once price-labeling become easily and quickly changeable (be afraid when grocery store prices are shown with LCD displays).

Herein lies the dark side of too much power from too much information.

Your price-optimization consultant tells you that students coming back from the bar after midnight don’t care too much about the price of frozen pizzas? Nudge those babies up by 15 cents every late-evening and watch your profits climb. Obese people less sensitive to the pricing of chocolate truffles? Put a weight sensor in the gourmet candy aisle. Mercedes drivers less discriminating towards wine prices? Do I really have to spell out for you what to do?

The AP article I mentioned at the beginning of this post predicts that store prices will become more like the mystical pricings of airplane tickets, and I doubt many consumers will relish that thought. Have you ever heard anyone say they wish other businesses priced their products like the airline industry? Where two people sitting beside each other who bought their tickets on the same website pay wildly different prices because their purchases were on different days? Imagine that you are in the register line at Virgin Records with the latest Bond DVD in hand, and the person in front of you buys the same DVD causing the price of your identical DVD to increase by $1. Welcome to the world of airline pricing strategy!

The days of setting prices based on a fixed margin, on prices from competitors, or simply on an incremental increase over last year’s prices is becoming a fading, quaint tradition. Welcome to the Machine.

I sound cynical, yes. But still…

I have to appreciate the evolution of process sophistication. Of modern thinking challenging and overcoming the wisdom of experience (goodbye Willie Loman). This is the essential nature of science, of business, of innovation: new ideas obsoleting the currently accepted lore. I particularly like seeing advanced mathematical theory being applied to such innocuous business processes as the pricing of ketchup. Luddites take note!

Truth be told, I’ve always had a warm spot towards the practical application of esoteric mathematical theory. In fact, since my college days I’ve had a warm spot towards the mathematical discipline of Information Theory (welcome “information theory” googlers!), probably because I tried a long time ago to apply it to neural signals and failed completely (but others eventually succeeded).

Information theory tells us, well, how much information is in something and how much information can be transferred by a transmission channel. How informative is the weatherman in San Diego when all he predicts in every forecast is that the weather the next day will be sunny and in the 80s? Even if is accurate 95% of the time? Information theory would tell you that his information content is low because there’s not much information in declarations of a near sure thing (Listen and be astounded: I am here to tell you that you will take a breath in the next 60 seconds! See?! How amazing is that?).

That being said, my prediction is that the next New Thing in business/marketing will be an information theoretic approach to marketing. Some marketing channels will be proven to have much more information capacity to target consumers than others, and the capacity of each channel will be calculated to the nearest bit, allowing companies to charge millions of dollars for advice on which channel will provide the highest information ROI for your marketing message. Advertising a NASCAR race on American Idol, or promoting hearing aids in Mad Magazine? That’s less than 1 bit of advertising information. Advertising for either product in Golf Magazine, however—that’s called maximizing your channel capacity.

Informationtheory.com is already taken. Marketinginformationtheory.com is not. What’s your guess on how long until all of the latter’s related domains are taken?

Plaxoed Again

I just received an e-mail from Plaxo saying that my LinkedIn connections can now automatically be added to my Plaxo contact list. After years of Plaxo’s customers asking Plaxo to team up with LinkedIn (including me), it’s finally here.

This is a big deal. Maybe a tipping point for Plaxo? Hope so! Anyone who is in business and relies on connections has no excuse now not to join both companies.

As a side note: Come on, I scooped Plaxoed on this?

VA Tech Tragedy

I’m a Virginia Tech alumnus. My thoughts and wishes for recovery go out to the university and Blacksburg community.

iPod Listening Safety

There is considerable interest in the amount of damage to one’s hearing that listening to an iPod (or similar portable audio player) can cause. I’ve posted before on Apple’s attempt to prevent harm to hearing from iPods and discussed possible improvements. In the absence of such a solution, it’s important that people understand safe listening levels for iPods and similar devices.

At the recent annual conference of the American Auditory Society, researchers from the University of Colorado and the Children’s Hospital Boston presented the latest data on how long one can safely listen to digital portable music players (Portnuff and Fligor, Output Levels of Portable Music Players).

Firstly, they showed that the danger among all of the players tested (iPod, iPod Mini, iPod Nano, Creative Zen Micro, Sandisk Sansa) are approximately the same. In other words, iPods are no worse for your hearing than any of their competitors.

Secondly, there was no difference in danger to your hearing between different music genres. Believe it or not, R&B music is as potentially damaging as Rock music or Country music. No word on the danger from Opera (although some might suggest that the true danger lies in falling asleep and being exposed to hours of Wagner—or perhaps the danger is in staying awake).

Thirdly, how long you can safely listen to your music player depends on what you are listening with. People choose different earphones to listen to their player: some use the buds provided with the player, some upgrade to expensive insert earphones such as the Etymotic ER6s or Shure E4cs. Some choose to use large headphones that sit over the ears. Depending on which you use, your safe duration of listening is different.

The table below shows the levels calculated by the Boston University researchers that reach the 50% noise dose per day according to NIOSH standards. Exceeding these levels is not a good idea.

For example, if you use Etymotic ER6s (categorized as “Isolators” in the table below) and you are listening with the music player’s volume control at 80%, then you should not listen for more than 50 minutes a day. The authors of this research report even suggest that “more conservative recommendations may be warranted.” Listener beware.

Top 100 SF Restaurants Redux

The 2007 San Francisco Chronicle Top 100 Restaurant list was just published today, so I have revised my interactive chart for exploring various aspects of the top entries in San Francisco. I did this previously for the 2006 list using IBM’s Many Eyes, analyzing the SF entries and evaluating the relationships among the rating categories.

Click on the figure to the right to be taken to the website where you can easily plot data on the top SF restaurants according to your choosing. I’ve chosen to plot Food Rating on the horizontal axis, Price on the Vertical axis, and Overall Quality as symbol size. After you click on the figure, you can hover your mouse over each data point and see to which restaurant each corresponds. 

As with last year’s list, Ton Kiang continues to be the best valued restaurant in San Francisco (near the right-bottom: high food quality, low price), with Chow, Range, and Delfina among the next best valued.

One wonders why Kokkari is still in the Top 100 given how it sticks out from the crowd (it’s the tiny dot near the left-top: low food quality, high price). Kokkari used to be a top restaurant in the city, and I wonder if its continued Top 100 presence is simply due to lethargy in updating the list. I noticed that every new restaurant that I added to the list this year had solid 3 ratings across the board while Kokkari has mediocre ratings in each category—which is painfully obvious using the Many Eyes plot—except in atmosphere. There are 73 restaurants in San Francisco with an Overall Quality rating of 3 stars or more—why does the Top 100 list only 52 of them? And why do Hog Island Oyster Company and Tartine Bakery, both entries in the Top 100 Restaurant list, not have any Overall Quality rating at all from the SF Chronicle? Is it because they do not really qualify as restaurants?

As with last time, I did a correlational analysis of the restaurants to see what was responsible for the high ratings, and to see what higher prices bought a customer and what, if anything, is associated with good service.

The data above (see my previous post for an explanation of what this analysis means) shows how each category rating is related to each other. The closer to a value of 1, the more the two categories are related; the closer to a value of 0, the less the two categories are related.

Many of the same relationships hold from last year. The Overall Quality score was predominantly determined by Food Rating (correlation 0.88).  This reflects what criteria chief restaurant critic, Michael Bauer, uses to come up with his Overall Quality score (what the SF Chronicle refers to as a restaurant’s rating).

Noisiness was more correlated with the overall score this year (-0.35 this year vs -0.18 last year). Paying more will now get you slightly better service (0.36 this year vs 0.22 last year), although a correlation of 0.36 is still pathetically small—I’d like to see this number well above 0.5. Last year, the only thing that paying more seemed to get you was better atmosphere, but this year the Price is as correlated with Atmosphere (0.6) as it is with Overall Quality (0.56).

Note: I have not considered levels of statistical significance in this analysis, nor have I considered partial correlations which would be a more accurate but more time-consuming approach to this analysis.

The View from Intel Research Berkeley

Last week I went to an open house at Intel Research Berkeley, a research center that occupies the penthouse of the 14–story building that also houses the research facility I run. The views of the Bay Area from up there are probably the best one can see from the East Bay, appropriate for the visionary and lofty goals of the projects that Intel showcased.

The mission statement of the research center is

Drive off-roadmap, high-impact exploratory research vital to Intel

a sentiment that should easily translate to research at most companies. Interestingly, the technology buzztheme Simplicity has made its way into the Intel Research vision:

Essential Computing: simplifying and enriching all aspects of work and daily life

The research center was created in a 2001 Intel initiative to reach out to University talent, opening similar centers near Carnegie Mellon University and University of Washington (Intel Research Berkeley is 1 block from the UC Berkeley campus). Surprisingly, according to Henry Chesbrough in his book Open Innovation, Intel didn’t have much of an internal research effort until 1989, with only external research supporting them until then.

Okay, back to Intel’s open house.

The diversity of the research presented was impressive. There were posters and demos for over 50 projects, categorized into the following broad fields:

• Security/Networking/Distributed Systems
• Human-Computer Interaction
• Technology for Emerging Regions
• Programming Languages

Each project was also assigned a descriptor for marketing appeal:

• Richly Communicative
• Concealing Complexity
• Personal Awareness
• Emergence Engineering
• Potpourri
• Physicality

The Security/Networking/Distributed Systems research included projects on power management for routers, fingerprint pattern recognition, and virtual machines for long-term data storage and retrieval. The details in most of these were fairly incomprehensible to me given my lack of expertise in these areas.

Of greater interest (and comprehension) to me were the Human-Computer Interaction projects.

One was titled Data Souvenirs: book-like objects that sat on your table or bookshelf and provided electronic information on the spine and inside the book, such as an lcd screen indicating when you have received e-mail from specific addresses, eliminating the need to constantly check your e-mail at home over the weekend/evening. One intriguing application of this project was called something like Real-Time Journey in which the book represents the long-term progress of an historical event in real time. For example, the book might track the voyage of Lewis&Clark, with the spine displaying their progress over the same time-scale as the actual trip (e.g., distance traveled or states reached). Inside the book would be maps and information on their voyage. As the representation of the virtual trip reaches a landmark (e.g., Mississippi reached), you could open the book and read about that point on their voyage. The possibilities for other creative uses are interesting, although the most difficult part of this project is probably the identification of the key value proposition to consumers.

There were several interesting cellphone projects, focusing on either an application or a combination of application and system architecture. One project addressed problems of application incompatibility between cellphones by designing applications that did not run on the phone itself. They demonstrated an application where people could make real-time adjustments to a remote display with their cellphone, the demo’ed application being a conference meeting where people are adjusting their responses in reply to questions from the speaker. As they made adjustments to their response with their cellphone, they could see those changes in real-time on the remote display being projected.

Another cellphone application was place-based ringtones, where the ring that your phone makes will depend on who is nearby and what signatures they have on their phone. In a separate cellphone alert project, a visual metaphor was demonstrated that would accompany ringtones: instead of simply flashing the name and phone number of the person calling, a landscape image on the phone display would change to indicate if the call was from someone you know, a specific person, etc. For example, a park scene might suddenly show birds flying in the distance of the call is long distance, or a swan floating on a lake if it was a friend. This would personalize the information and encode the data in metaphor that only you could understand.

One interesting project was a combination of human behavior research with statistical analysis for the optimization of computer power management. Several gigabytes of data were obtained from thousands of hours of pc usage to determine when is the best time to power down such computer resources as a computer screen or hard disk. The goal was to maximize battery life while minimizing human annoyance. The challenge was how to measure this passively, without constantly asking people what they like and don’t like. The researcher(s) ended up interpreting user annoyance by identifying associated behavior: if the user immediately shakes the mouse or mashes on the keyboard immediately after the screen powers off, that’s a sign that the person did not want the screen to power down at that time. Data on what the user had been doing and what states the computer was in before power-down was gathered to understand how to predict when the user does and does not want a power-down. A massive hidden Markov model was created from the 50–dimensional data set to predict human behavior such that the power management can better determine when to power components down, rather than rely on simple rules like “turn off the screen after 5 minutes of inactivity.”

There were several projects that focused on providing technology in emerging regions, such as West Africa and India. Applications ranged from providing WiMax connectivity and telemedicine in rural areas (see Cnet video), and literacy programs developed for cellphones. Several projects also addressed green issues.

I was impressed with the variety of projects at this one small facility. How they get that work done with those spectacular floor-to-ceiling views, I have no idea.

JC Bacharach

I haven’t seen many commercials since getting my Series 1 Tivo many years ago, but for some reason I stopped during a recent commercial break to watch the commercial embedded below. I recall some research showing that well known musical pieces can be recognized within one second, and perhaps that’s why I stopped on this commercial: I heard the first second of the music.

The commercial is astonishing in that it is for…wait for it…JC Penny. Not a brand known for its hip/cool image or fashion. This commercial, and a series of other ones, presents a striking new image and speaks to the power of creativity in marketing and its ability to change the perception of a low-quality product/merchant.

For some reason, this campaign resonates with me. Maybe because of the focus in this commercial on classic movies, which definitely has a place in my life, but for sure because of the use of Burt Bacharach music, one of the two greatest songwriters of the latter half of the 20th century (any guesses on who the other is?).

Oh, and a different JC Penny commercial features this other sprightly song as well:

http://www.myspace.com/foreverthursdaymusic

Edit May 3, 2007: For those of you looking for information on the song used in the new JC Penny commercial that premiered tonight during Grey’s Anatomy, the song Only You is performed by Joshua Radin and is on his new album. You can hear a clip on his official website.

Ream Oeuvred Your Care Eons

I’ve been sitting in the Phoenix airport for almost two hours now listening to their synthesized-voice announcements over and over again and I am thoroughly sick of this speech synthesis technology. The intonation is wrong on much of what it says, similar to what one would expect from someone reading English text when they are not too familiar with the language.

I keep expecting one of the announcements to begin with, “Hello, my name a Borat,” and end with, “Iaye liiike.” The phrase “removed your carry-ons,” in a message that repeats every ten minutes, has the prosody of a five-year old rapping to polka music.

The apparent lack of interest in using a system that sounds more human-like is as disturbing as the speech itself. I suppose that I am more sensitive to such things than other people given my interests in speech&hearing, but I wonder if Bobby Johnston noticed the announcement asking “Bob Eee Johns Ton” to meet his party at baggage claim.

I am reminded of American Express’s recent change of their automated phone system in using a voice that sounds like a young Valley Girl. Is this really what AmEx customers want to hear when they call about a financial inquiry? I appreciate that automatic speech (synthesis) systems provide efficiency and cost-savings, but they do so at the additional potential cost of annoyed listeners.

(For those of you still scratching your heads on the meaning of this post's title, read it out loud. Then compare what you just said with "removed your carry-ons"  :)