IMMI - The best business case for Data Centers in Iceland

[Original Post written@http://startupiceland.wordpress.com]

Many of you know that I don't understand the business case for Data Centers in Iceland. I have written about why Data Centers will not work in Iceland here and here. I was wrong! IMMI or the International Modern Media Initiative is by far the best business case for Data Centers in Iceland. I knew about the initiative but I was not aware of the status of the resolutions that was passed in the Icelandic Parliament. I believe this is one of those rare moments in history where a nation is at a cross road and it chooses to lead the world... Iceland has that opportunity! I am strongly in support of this initiative. I am not political but I believe this initiative is as important as the laws on Human Rights. Freedom of the Internet and information on the Internet has been threatened many times through SOPA, PIPA and ACTA... I am positive there will be future attempts. I believe that Internet Service Providers are similar to those who pave the road, the road should not be shut down just because someone decided to drive at 300 miles/hr and killed someone. That has been the approach so far of every Government in the world. I believe Governments need to provide the proper legal framework to operate in, the Internet is a new paradigm where physical borders don't apply and trying to legislate it just like in the physical world just does not work. We need laws that understands and accommodates how the Internet works. Everyone of us have a role to play in this. The coordinated effort that was demonstrated to protest against SOPA and PIPA is needed to ensure the right kind of laws are passed that protect the freedom of information for the Global Citizen on the Internet.

Related articles

• Verne Global & Colt Industries Show a Zero Carbon Data Center (zdnet.com)
• Nordic Nations Pitch For US Data Centers (it.slashdot.org)

Innovation Clusters - Why they don't work

Here is an interesting article about "How to make a region innovative"  by Strategy+Business portal of Booz & Company. Why am I writing about this? well, because there is all this talk about Innovation Clusters in Iceland around Geothermal Energy, Seafood etc In My Humble Opinion (IMHO), it is a waste of time! this is old school thinking that never works. Don't take my word for it go and read the article. I am not the only one who thinks this way, there is a need for new thinking on innovation and entrepreneurship all around the world so how does not go about creating this new value i.e new equity. We are here because over indulgence in Debt has basically eaten away all the equity in the world. I am sure we all can agree that is the case in Iceland, but more and more countries are starting to feel the pain of this... hello! have you seen the news about Greece, Spain, Italy, Portugal... and the USA? So, here is a thought start hyper growth companies that can innovate at the speed of the internet and it can be done only by small teams because of chemistry, mechanics, change management etc. There is enough evidence to support Bigger a company gets the smaller is their rate of innovation, I am sure there are exceptions to this, but the majority of large companies fall into What Clay Christensen calls the Innovators Dilemma. If you have not read the book I highly recommend it. The only way to innovate out of crisis is to start small, start at the grass root and change the entire paradigm of thinking and radically make traditional businesses obsolete. There is only one sector that is good at this at the the Startup Nation! Actually I would go one step further and say... you better be thinking about a Startup Of You, no wait Reid Hoffman of LinkedIn just wrote a book with that title. People these days, always stealing ideas :) just kidding. Go and read that book it is fascinating to think about the fundamental changes that are happening right in front of our eyes, but you need to be aware to see or suddenly you become obsolete. Are you getting obsolete?

Related articles

• Startup Secret 40: The trinity of startup disciplines (news.cnet.com)

Skolapulsinn.is - Mashing Technology, Education and Psychology

Brian Suda, does not need any introduction in the Icelandic Startup Scene. He also writes a pretty well read blog @optional.is. I stumbled upon this post by Brian on Skolapulsinn.is which he and a couple of other hackers put together for solving a big problem in Schools, to gauge the pulse of the students. Typically this is captured by asking the students through Surveys, but Skolapulsinn.is makes that feedback look much shorter and allows for School Administrator and Teachers to react in real time on what is going in the school system. He has written a very detailed post on this in his blog here. I have to be honest I was not aware that this tool was hacked together in 2008 and has surveyed more than 12000 students, thats pretty impressive data set. I need to talk to Brian today and understand where is this data and what can we learn from it.  I bet you could ask a whole lot of questions and this data can be used to understand the living breathing student community in Iceland in real time. I like how Brain refers to the school system as a living breathing thing rather than a stoic institution. We could ask important questions like how involved are the parents in the school work of the students, because time and time again it has been proven that kids whose parents are more involved with their kids work, make better students. We can actually give a more real-time report card rather than wait for the year to be over or solicit the opinion of the teacher. It is the kid who knows whether their  parents are involved in the home work or not. In addition, we could ask questions about the general feeling of the students to access whether they are feeling positive about school, their self confidence etc. This tools is a fascinating introduction to me and I obviously am going to bug Brian about how this is used in the Icelandic School System. If it is not used, then I want to lobby to the Ministry of Education and get them to use it. We need innovation like this to Tinker and Learn to improve our educational system, after all is'nt Education about Learning?

Related articles

• Students Learn Better with Engaged Parents (usnews.com)
• Students on Bullying: Important Insights (education.com)
• Do Involved Parents Help Teens Learn Better? (huffingtonpost.com)
• Self Fulfilling Prophecy!(Gloom and Doom) (oldschoolteach.wordpress.com)

Revolution against Finance

I saw the interview of Steve Keen on Silfur Egils and I am sure if not all many of the Icelanders did too.



I have written about the Asset Bubble that is possible in Iceland and I have started to see green shoots of it already. Check out the housing prices to see the asset bubble formation. It really bothers me that nobody wants to bell the cat, I speak to my banking friends and they are all waiting for the good old times to come back. It is not going to happen, maybe it will for a small group of people... much smaller than the last time and that is what casuses social rifts. I think the most important statement made in the interview was that we have moved away from Finance for Industrial and Productive things to Finance of Financial things. The double leverage that is possible with financial instruments that make $1 get multiplied by 10 and 10 again in the short term produces $100 but in the long term does not produce anything. In the meanwhile that $1 carries the risk of destroying $100 in value. No wonder Warren Buffet called derivatives Weapons of Mass Destruction. Should we worry about this problem?  absolutely! You think Iceland is different because Iceland allowed the banks to fail? think again, look at the balance sheet of Icelandic Government, a majority of the liabilities have been allocated to re-capitalize the banks... guess who has to pay those liabilities? the tax payer.

I agree that we need to re-think financial economics, but lets not throw the baby with the bath water. The original premise that financial capital was created to make productive things has been lost in this debate. I am sure there are many ways to solve the current debt problem and Steve Keen gives some suggestions but there are other ways as well.

Lets take the case of Iceland, everyone wants to speculate on Real Estate once again... I mean really? concrete is more valuable than solutions to problems the future generation is going to face? Top 10 companies in the market capitalization are not in Real Estate the last time I looked. We need to focus on what creates value in Iceland. I have had many discussions with the executives in the banking sector, believe me there is absolutely no learning in terms of changing the ways of doing things. Every bank wants to clean up their balance sheet so they can go on building up the asset bubble on real estate. No-one is thinking about which sector or industry should they be investing in. I have written about my vision for Iceland and why we should be investing in Entrepreneurship, the sector that I wrote about is highly scalable, employs high technology and highly skilled labor force, is environmentally clean and things made in this sector actually can be sold anywhere in the world. How much capital is deployed in this sector by the Iceland you ask... Nothing, Nada, Zilch! The classic reason that I get is it is risky, what is risky? speculating on real estate or investing in Entrepreneurs who work tirelessly to really solve a nagging problem.

Related articles

• Iceland Tells The Banks Where To Go... (genuinewitty.wordpress.com)

3 Great Global Challenges

I have been a fan of Thomas L. Friedman since I started reading the New York Times and then his books, The Lexus and the Olive Tree, The World is Flat, Hot, Flat and Crowded etc He has a knack to say the things that matter in the simplest of words and gets your brain working. His latest opinion with title "We Need a Second Party" is a classic. Although the message of the article is geared towards the Republican Presidential Candidate run-off, the take away for the rest of us is the challenges that he outlines. These challenges are not America's challenges these are Global challenges, every country, every citizen needs to be thinking about how they are being impacted by these challenges. No longer can we be complacent about our job, or position or title or education thinking that is going to save your future. The challenges are here and you better have a strategy to tackle them. Let me outline what those are:

"The first is responding to the challenges and opportunities of an era in which globalization and the information technology revolution have dramatically intensified, creating a hyperconnected world. This is a world in which education, innovation and talent will be rewarded more than ever. This is a world in which there will be no more “developed” and “developing countries,” but only HIEs (high-imagination-enabling countries) and LIEs (low-imagination-enabling countries)"


Wow! could he be more direct? where do you think Iceland ranks in this HIE vs LIE world? are we really making Iceland ready for the onslaught? believe me the competition is coming whether you like it or not, a billion people in India and China are raring to go, they are more motivated, they work harder and they want to win so badly that their lives depends on it. How can Iceland compete with that?


"The second of our great long-term challenges are our huge debt and entitlement obligations. They can’t be fixed without raising and reforming taxes and trimming entitlements and defense. We absolutely cannot just cut entitlements and defense. That would imperil the personal security and national security of every American. We must also reform taxes to raise more revenues."


I cannot emphasize enough the problem of entitlement, this is an epidemic and it is cancerous. There is only one way to solve this problem, arm every citizen with the tools to create their own wealth and their own future then they stop asking where's my beef. Entrepreneurs and sustainable entrepreneurial ecosystems enable that, are we creating a sustainable entrepreneurial ecosystem here in Iceland? I will follow up with the post on the Icelandic entitlement cost and I have written about the perception challenges in Iceland and Icelandic Governmental Resource Allocation problem. Of course Iceland does not have the problem of a huge defense spending but we have the challenge of very high levels of public debt. That in itself can suck the entire country and the standard living down.


"Our third great challenge is how we power our future — without dangerously polluting and warming the earth — as the global population grows from 7 billion to 9 billion people by 2050, and more and more of them want to drive, eat and live like Americans. Two billion more people who want to live like us? We can’t drill our way out of that challenge, which is why energy efficiency and clean power will be the next great global industry. Real conservatives — like Richard Nixon, the father of the Environmental Protection Agency, and George H.W. Bush, the author of the first cap-and-trade deal to curb acid rain — believe in conserving. The current Republican candidates are so captured by the oil and coal lobbies that they can’t think seriously about this huge opportunity for energy innovation."


Here Iceland has a clear lead, because Iceland is endowed with the gift of natural energy. We need to take the lead on policies that enhance this rather than build walls and stop progress. I am not saying not to take the Environment into consideration, there has to be a balance and we can make policies that enable investments in the Renewable Energy field that does not hamper the environment and leaves it in a better shape than when we found it. It can be done.


What do you think?