The Hindu Business Line : Win-win possible in creative capitalism

Win-win is possible, and you can brag about it, assures Bill Gates, in one of the conversations with Warren Buffett. “If you figure out how to give good customer service, you are allowed to brag about how you have great customer service. If you figure out how to make governments love you by helping the poor people in that country, you get both the benefit of the government loving you and you get to say you helped the poor in that country,” reads a snatch of the dialogue in Creative Capitalism: A conversation with Bill Gates, Warren Buffett, and other economic leaders, edited by Michael Kinsley ( www.landmarkonthenet.com).

For a whole range of goods — such as, clothing, cars, cell-phones, electronics, computers, and entertainment — the goods bought by the poorest overlap enough with those bought by the rich that there is little problem, notes Gregory Clark in an essay included in the book. The cell-phone is a great example, he adds. “It is sweeping Africa, with affordable service on offer to people earning two dollars a day.”

Much of modern capitalism, Clark finds, is characterised by firms with high fixed costs — for research and development, for production facilities — but low production costs. “Think computer software, think computers, think drugs, think airplanes. This production structure, however, favours mostly third-world consumers.”

Of interest.

Speech synthesiser

Pure sounds may exist for seconds in music, but in speech no sound stays ‘pure’ for more than milliseconds, unless uttered in special laboratory conditions, writes John Man in Alpha Beta: How our alphabet shaped the modern world ( www.rbooks.co.uk).

“Some sounds are ‘pure,’ in that they are the same backwards as forwards, like the extended ‘a-a-ah’ requested by doctors when viewing throats. But some, like p, are actually composites with their own narrative structure: silence, a gathering of muscular forces — lips, lungs, air pressure — then a release of air, an opening of the lips and an engagement of the voice-box. You could no more say it backwards than unburst a balloon.”

Those working on speech synthesising know that in speech, any sound is affected in subtle ways by what precedes and what follows, and by tone, emphasis or the position of the tongue, and so on, as the author explains. “Nowadays, those who aim to synthesise speech focus not on the ‘pure’ sounds, but on the ways sounds flow into each other in so-called diphones. Only when the right choice is made of the three hundred or so possible combinations does machine-synthesised speech become comprehensible.”

To choose the right sound from several possibilities, a computer has to recognise context, Man informs. “It may use the same rule to say am and ham, but it will need other, higher-level rules to modify the ham element in shame and Thames. Diphones have to be overlapped, then have the transitions smoothed out by a phonetic paintbox.”

Many theoreticians argue that this can only happen when a synthesiser understands what it is saying, which implies an artificial intelligence beyond anything yet achieved, the author observes.

Valuable read.

Artificial culture

Our recent culture has made it startlingly easy to live only in a world of personal dreams, a realm from which hard reality has largely been vanquished, rues Eric G. Wilson in Against Happiness ( www.fsgbooks.com). It is our cutting-edge technologies that have empowered us to shape the world into a paradise of convenience and efficiency, he adds. “With our computers and our medical machines and our pharmaceuticals in tow, we appear to have very little to worry about beyond our next quick fix.”

If you want to see our artificial culture in action, you don’t have to look far. Thanks to the digital age, we are more likely to witness pixels than people, bemoans Wilson. “We spend hours in front of our PCs playing in the wispy fields of virtual reality. In the infinite corridors of the Internet, we find Web pages more interesting than the morning strands, shiny with dew, of the garden spider.”

More disturbingly, we treat our machine as if it were an organ and our organs as if they were machines, the author finds. “Our computer can be ‘user friendly.’ It can come down with a ‘virus.’ Meanwhile we engage in ‘interfaces’ with our colleagues. We ‘process’ ideas.”

Too important to ignore.

Fair price

We expect that prices of high-tech products fall substantially with time, but not very fast, says Pete Lunn in Basic Instincts: Human nature and the new economics ( www.marshallcavendish.co.uk). He cites the example of how the early buyers of iPhone felt ripped off when Apple could knock a third off the price and could still make a profit.

“‘We apologise for disappointing you, and we are doing our best to live up to your high expectations.’ These were the words of Steve Jobs, chief executive of Apple, to all those who had bought the new iPhone for $599, in summer 2007, before seeing the price plummet to $399 in September, just two months after the product’s launch,” narrates Lunn.

“The company was bombarded with e-mails complaining about the price cut. Mr Jobs didn’t only apologise, but gave each customer a $100 voucher and added that Apple needed to ‘do the right thing for our valued iPhone customers.’”

We have a concept of a fair price, the author explains. Studies have shown how most people instinctively find price discrimination to be unfair, and the drastic drop in price sends a clear negative signal to the prior buyers.

Apple was engaged in what’s called ‘price discrimination’ — charging different types of customer different prices for the same product, Lunn says. “Very early adopters of the iPhone were charged more and they felt unfairly discriminated against. The fact that they presumably wanted an iPhone more than people who bought one later did not alter how they felt.”

Instructive lessons.

Tailpiece

“The unique identification scheme can be successful if…”

“Nilekani takes the help of our IT talent?”

“And also the memory trainers, who can help us remember a long number!”

dmurali@thehindu.co.in