Goldenseal Pro Progress: Monopolies (Feb 21)

Ithaca has five new-car dealerships scattered along the main drag. Years ago they were independent, but one of them started to buy up the others. Now they’ve gobbled all five, and are expanding into nearby towns and cities.

There’s a lot to be said for owning a monopoly. You can charge your customers more. You can pay less to your sales and repair staff. Where else are people gonna go? Even better, you can use the excess profit to expand and/or purchase the competition, and get even more monopoly. It’s a positive feedback loop. A chance for exponential growth. One reason why the rich get richer.

Doing business with a monopoly? Not so great. Fortunately, there still are independent repair shops in town. It’s also possible to drive an hour and get dealer services for 1/2 to 2/3 the local price. Both those options may dry up if the trend continues.

Sadly, more car monopoly is likely: dealerships are consolidating everywhere. The local group isn’t even in the top 150 for size. Their industry is following the same path as banks, auto parts stores, lumber yards. However, the difference is that auto dealers already have franchises: a local monopoly for one or a few brands. Merge them, and it’s like owning every bank in town. Hedge funds must be drooling.

Monopoly is a problem we face as a construction software company. TurtleSoft is a minnow swimming in a sea owned by trillion-dollar tech monopoly sharks.

The Apple/Microsoft desktop duopoly doesn’t mean higher prices for us. In fact, their development tools are free. The problem, I think, is a more general arrogance. It happens when wealth and power get concentrated. No competition, so no need to make their tools excellent. If it takes 4x as long to build for the platform, well, that’s just the cost of entry. Suck it up.

Plain old incompetence may also be part of the problem. Too many pointy-haired bosses in the decision chain. Or maybe there is something else at play. Minnows can’t easily understand sharks. All they see is skin, teeth and turbulence.

For whatever reason, we wasted more than 4 years with Cocoa/Xcode from Apple, and MFC/Visual Studio from Microsoft.

I did a post-mortem recently, looking back at all our past successes and failures. They very much correlate with monopoly.

TurtleSoft started with MacNail, estimating software based on Excel spreadsheets. It was back when Microsoft was the scrappy underdog struggling against Lotus 1-2-3. Later we released BidMagic, made with Apple’s HyperCard when they were the scrappy underdog competing against IBM, DOS and Windows. Next came Goldenseal, built using CodeWarrior from Metrowerks. They were the smallest, scrappiest underdog of them all. CodeWarrior was also the best tool our staff has ever worked with.

In all three cases, I think the scrappiness led to excellent programmer tools. They had to be amazing, or die. The end result for us was being able to create software in a reasonable amount of time. The tools were satisfying to use. Almost fun. Definitely productive.

Sadly, all three of those tools lost their greatness prematurely. Excel grew bloated after Version 3.0, with a bug that randomly zapped code in our macro sheets. HyperCard stagnated and soon disappeared. Metrowerks was absorbed by Motorola. After a few years they butchered CodeWarrior and sold its organs.

Scrappiness does not guarantee great software. Over the years we’ve tried at least a dozen development platforms that didn’t work out. Some came from big fish, but most were made by minnows that later died. It’s always a gamble.

Fortunately, Qt is proving to be like the 3 best development tools we’ve used. Every week it lets our staff make serious progress on Goldenseal Pro. Things are really cruising.

In the future, TurtleSoft will be less tolerant of BS from the trillion-dollar companies. They lost something important, getting to be so big.

Looking at the bigger picture, monopolies may have grown too powerful. There’s too much concentration of wealth and power these days. Too much arrogance and incompetence.

It may be time again for some Teddy Roosevelt-style monopoly busting. Clamping down probably won’t help car owners around here, but at least it can rein in the biggest of the sharks.

Dennis Kolva
Programming Director
TurtleSoft.com

Rule of Law (Jan 20)

Over the past 33 years, about 2% of the orders for our estimating and accounting software have been fraudulent. In the early days it was bounced checks. Then it switched to stolen credit cards. After each rip-off, we gradually refined the fraud-prevention checklist.

TurtleSoft offered expensive Express Mail shipping for many years, because fraudsters almost always used it. They weren’t the ones paying, so why not? Our staff checked those orders much more closely.

Rule of Law lists were helpful when orders came from unknown countries. They’re calculated by Center for Financial Security and World Justice Project. Countries with poor ROL ratings are much more likely to have fraud.

Basically, Rule of Law is a measure of integrity, reliability, truth, fairness, justice, trust. All the good things that (most) religions try to teach. Boy Scout stuff. It means places where power comes from laws, not men. Where leaders are public servants. Not autocrats, demagogues, despots, dictators, kleptocrats, mobs, tyrants, or whatever.

ROL is important when we mail out rare Swiss Army knives (our side business). Orders to Germany (#6) or Netherlands (#7) will get there. Orders to Russia (#92) are 50% likely to be stolen along the way. Anything below that is a black hole. Our current cutoff is roughly #50.

ROL is why Hong Kong residents keep protesting. Their island is #17 on the list. They don’t want to be swallowed into #89 China, where people can just disappear suddenly, and/or have their organs harvested.

The US is only #21 on the latest Rule of Law list. We fell a couple spots during the Trump era. Ahead of us are most of Europe, plus Japan, South Korea, Singapore, New Zealand, Canada.

TurtleSoft actually sold a copy of our accounting software to a legit firm in Nigeria (#109). The order took many weeks to process. People can’t get regular credit cards there, so payment had to go by wire transfer. It took several tries. Everyone involved said “Um, it’s Nigeria. Are you sure you want to do this?” A low ROL rating has real, negative consequences for those who live there. Ditto for visitors.

In construction, Rule of Law means building inspectors who make sure structures are safe and sturdy. Zoning boards that are fair and impartial. Suppliers who don’t sell you defective goods. Employees and subs who care about their work and don’t cheat or steal. Clients who actually pay you. All stuff that makes it easier to run a business.

Rule of Law varies inside the US. I spent a year managing remodeling projects in Boston, at a time when much of the Building Department was under indictment for bribery. The neighborhoods where I worked probably rated somewhere between #52 Jamaica and #62 Brazil. Everything was so much more chaotic and difficult.

One example: a developer that my boss worked for added an illegal basement unit. It was below sea level. Municipal pumps failed during heavy rains at high tide, so the condo filled with neck-deep water and backed-up sewage. My crew had to put the main project on hold, and wade in for emergency repairs. Fun fact: refrigerators float in floods, then topple and do structural damage.

Less fun fact: that part of Boston is a former bay and mud flats, with 4-story brick row houses built atop wood pilings sunk into the muck and fill below. The developer installed sump pumps to keep the new unit dry. Those pilings had lasted 100+ years because they were always under water. Now the water table is lower, so they’re exposed to oxygen, and rotting. If you ever read about building collapses in the South End of Boston, they’re the result of greed and corruption in the 1980s.

I mention all this because on January 6, the US flirted with becoming a government of man and mob, not laws. Rule of Law is still under threat here. Arnold Schwarzenegger explains how easily things can go wrong.

Integrity is not hard-wired into the human genome. It takes effort to maintain it. Often it’s an uphill battle, because there’s all sorts of short-term profit to be made from lying and cheating.

What does seem to be hard-wired is blind loyalty to charismatic leaders. Not in everyone, but enough. It’s surprising how much impact one person can have on a whole country. Many people just seem born to follow, even when it leads to drinking the Kool-Aid. Or posting selfies while chanting slogans and committing felonies. I must have killed a couple days watching videos made by Capitol rioters.

Now that we have a new leader, hopefully we’ll see increasing Rule of Law, not less of it. Maybe we can find better ways to protect ROL. There’s a lot to be said for not becoming a shit-hole country.

Dennis Kolva
Programming Director
TurtleSoft.com