Stanford University is so startlingly paradisial, so fragrant and sunny, it’s as if you could eat from the trees and live happily forever. Students ride their bikes through manicured quads, past blooming flowers and statues by Rodin, to buildings named for benefactors like Gates, Hewlett, and Packard. Everyone seems happy, though there is a well-known phenomenon called the “Stanford duck syndrome”: students seem cheerful, but all the while they are furiously paddling their legs to stay afloat. What they are generally paddling toward are careers of the sort that could get their names on those buildings. The campus has its jocks, stoners, and poets, but what it is famous for are budding entrepreneurs, engineers, and computer aces hoping to make their fortune in one crevasse or another of Silicon Valley.
Innovation comes from myriad sources, including the bastions of East Coast learning, but Stanford has established itself as the intellectual nexus of the information economy. In early April, Facebook acquired the photo-sharing service Instagram, for a billion dollars; naturally, the co-founders of the two-year-old company are Stanford graduates in their late twenties. The initial investor was a Stanford alumnus.
The campus, in fact, seems designed to nurture such success. The founder of Sierra Ventures, Peter C. Wendell, has been teaching Entrepreneurship and Venture Capital part time at the business school for twenty-one years, and he invites sixteen venture capitalists to visit and work with his students. Eric Schmidt, the chairman of Google, joins him for a third of the classes, and Raymond Nasr, a prominent communications and public-relations executive in the Valley, attends them all. Scott Cook, who co-founded Intuit, drops by to talk to Wendell’s class. After class, faculty, students, and guests often pick up lattes at Starbucks or cafeteria snacks and make their way to outdoor tables.
On a sunny day in February, Evan Spiegel had an appointment with Wendell and Nasr to seek their advice. A lean mechanical-engineering senior from Los Angeles, in a cardigan, T-shirt, and jeans, Spiegel wanted to describe the mobile-phone application, called Snapchat, that he and a fraternity brother had designed. The idea came to him when a friend said, “I wish these photos I am sending this girl would disappear.” As Spiegel and his partner conceived it, the app would allow users to avoid making youthful indiscretions a matter of digital permanence. You could take pictures on a mobile device and share them, and after ten seconds the images would disappear.
Spiegel needed some business advice from campus mentors. He and his partner already had forty thousand users and were maxing out their credit cards. If they reached a million customers, the cost of their computer servers would exceed twenty thousand dollars per month. Spiegel told Wendell and Nasr that he needed investment money but feared going to a venture-capital firm, “because we don’t want to lose control of the company.” When Wendell asked if he’d like an introduction to the people at Twitter, Spiegel said that he was afraid that they might steal the idea. Wendell and Nasr suggested a meeting with Google’s venture-capital arm. Spiegel agreed, Nasr arranged it, and Spiegel and Google are now talking.
Spiegel knows that mentors like Wendell will play an important part in helping him to realize his dreams for the mobile app. “I had the opportunity to sit in Peter’s class as a sophomore,” Spiegel says. “I was sitting next to Eric Schmidt. I was sitting next to Chad Hurley, from YouTube. I would go to lunches after class and listen to these guys talk. I met Scott Cook, who’s been an incredible mentor.” His faculty adviser, David Kelley, the head of the school of design, put him in touch with prospective angel investors.
If the Ivy League was the breeding ground for the élites of the American Century, Stanford is the farm system for Silicon Valley. When looking for engineers, Schmidt said, Google starts at Stanford. Five per cent of Google employees are Stanford graduates. The president of Stanford, John L. Hennessy, is a director of Google; he is also a director of Cisco Systems and a successful former entrepreneur. Stanford’s Office of Technology Licensing has licensed eight thousand campus-inspired inventions, and has generated $1.3 billion in royalties for the university. Stanford’s public-relations arm proclaims that five thousand companies “trace their origins to Stanford ideas or to Stanford faculty and students.” They include Hewlett-Packard, Yahoo, Cisco Systems, Sun Microsystems, eBay, Netflix, Electronic Arts, Intuit, Fairchild Semiconductor, Agilent Technologies, Silicon Graphics, LinkedIn, and E*Trade.
John Doerr, a partner at the venture-capital firm Kleiner Perkins Caufield & Byers, which bankrolled such companies as Google and Amazon, regularly visits campus to scout for ideas. He describes Stanford as “the germplasm for innovation. I can’t imagine Silicon Valley without Stanford University.”…
An unconventional bonanza: New sources of gas could transform the world’s energy markets- but it won’t be quick or easy
July 16, 2012
COLOURLESS, ODOURLESS, LIGHTER than air. Natural gas may not have much impact on the senses, but as a source of heat and power it is transforming energy markets. Around 100AD Plutarch, a Graeco-Roman poet, noted the “eternal fires” in what is now Iraq. They were probably methane gas seeping out of the ground, ignited by lightning. Those eternal fires are now proliferating. An unexpected boom in shale gas that has taken off in America may well spread elsewhere and will add massively to global gas supplies.
Shale gas—an “unconventional” source of methane, like coal-bed gas (in coal seams) and tight gas (trapped in rock formations)—has rapidly transformed America’s energy outlook. At the same time discoveries of vast reserves of conventional gas from traditional wells have pushed up known reserves around the world. Gas is the only fossil fuel set to increase its share of energy demand in the years to come.
For a long time it was regarded as oil’s poor relation. In the late 18th century William Murdoch, a Scottish engineer, used it to light his house, but it did not catch on until some decades later when it became popular for illuminating homes and streets, replacing flickering candles. Commercial exploitation of gas and oil began around the same time, yet gas remained a niche product for lighting. And despite its rapid rise in recent years, it will still lag oil as a source of energy by 2035, according to the International Energy Agency (IEA), a rich-world energy club—and overtake coal by then only if the new gas reserves are fully exploited.
The trouble with gas is that it is difficult and expensive to transport. That used to be true of oil too, but since the development of supertankers in the 1960s it can be shifted relatively cheaply to find a customer in the world market. Gas needs a ready buyer and a way of delivering it.
A priceless commodity
Because of those hefty transport costs, gas does not behave like a commodity. Only one-third of all gas is traded across borders, compared with two-thirds of oil. Other commodities fetch roughly the same price the world over, but gas has no global price. In America, as well as in Britain and Australia, it is traded freely and prices are set through competition. In continental Europe traded gas markets are gaining a foothold, but most gas is delivered through pipelines and sold on long-term contracts linked to the price of oil, for which it used to be seen as a substitute. Gas-poor Asia relies heavily on imports of liquefied natural gas (LNG). “Stranded gas”, too far from its markets to go down a pipe, can be turned into a liquid by cooling it to -162°C, shipped in specialist tankers and turned back into gas at its destination. But the huge plants needed to do the job at both ends are very costly.
Since gas prices in different parts of the world are set by quite different mechanisms, they vary wildly across the globe. In America, where shale gas is whooshing out of the ground, they recently fell to a ten-year low. In Asia they can be ten times the American level.
Gas all over
Global reserves have been steadily increasing for at least 30 years. According to a report from the Massachusetts Institute of Technology (MIT), published last year, world production has grown significantly too, rising by two-fifths between 1990 and 2009, twice as fast as that of oil. Only half a decade ago it looked as though the world might have only 50 or 60 years-worth of gas. Now shale and other unconventional as well as new conventional gas finds have increased that period to 200 years or more, by some estimates.
The unconventional-gas bonanza has roughly doubled the gas resource base, a measure of the total gas in the ground rather than what might be economically recoverable. In 2009 the IEA estimated the “long-term global recoverable gas resource base” at 850 trillion cubic metres (tcm), against 400tcm only a year earlier. The main reason for the rethink was shale gas and other unconventionals. Not just America but parts of Europe, China, Argentina, Brazil, Mexico, Canada and several African countries, among others, sit atop as yet unknown quantities of gas that could transform their energy outlook…
Dark Soldiers of the New Order: The Soviet Union’s spies haven’t disappeared, they’re just wearing new clothes
July 16, 2012
The cold breath of the Communist secret police state blighted countless lives behind the Iron Curtain. But it also touched my own childhood in 1970s Oxford. Olgica, our Yugoslav lodger, had an exciting secret: Uncle Dušan. The poet Matthew Arnold described Oxford as “home of lost causes, and forsaken beliefs, and unpopular names, and impossible loyalties.” In Dušan’s case, this was partly right: his surname (like those of most east European émigrés) if not exactly unpopular, was certainly baffling to British eyes and ears. I recall him as a glum, shadowy figure, with plenty to be glum about. His cause seemed irretrievably lost. He was a hero in his own twilight world, but in post-war Yugoslavia, the authorities denounced anti-communists like him as criminals and traitors. Many perished in mass graves or in the torture cells of the secret police. Dušan was one of the lucky ones. He had escaped to Britain, to a humble job as a mechanic and life in Crotch Crescent, a drab street in Oxford’s outskirts — a sad comedown for someone who in pre-war Yugoslavia had been a high-flying young civil servant.
But in one respect, Dušan did not fit Arnold’s dictum. Despite his disappointments, he had not forsaken his beliefs: communism was evil and the people who ruled his homeland were usurpers. In fact, Yugoslavia’s independent-minded communists had become mild by comparison with the much tougher regimes of the Soviet bloc. But they were still ruthless in their treatment of dissenters, particularly those with contacts with anti-communists abroad. Olgica’s family maintained, at great risk, secret links with relatives abroad, flatly denying all knowledge of them under interrogation from the secret police. In Oxford, she visited her uncle each weekend. Had the authorities at home known that she was hobnobbing with a dangerous anti-communist émigré, her father’s glittering medical career (which had even brought him, briefly, to Oxford) would end; her own future (she had stayed on to finish her schooling) would be jeopardized too. It could even be dangerous for her to return home, leaving her stranded in Britain as a teenage refugee.
My own childish preoccupations blundered into this grown-up world. Even before Olgica’s arrival, my boyhood obsession had been Eastern Europe. I would spend hours looking at dusty atlases, and reading about the vanished kingdoms and republics of the pre-communist era, with their long-forgotten politicians, quaint postage stamps and exotic languages. Behind the Iron Curtain, they seemed as distant and unreal as Atlantis. In my early teens, I needed an example of communist propaganda for a school history project and decided to write to the Yugoslav embassy in London, asking for an official statement of how their government saw their defeated royalist rivals. That would, I thought, sit nicely alongside the other exhibits I had already assembled, including a passage from Winston Churchill’s history of the war, a poignant account of life in Cambridge by the exiled Yugoslav boy-king Peter, and a sizzling history of a British military mission to his doomed soldiers.
I proudly announced my plan. To my consternation, Olgica turned white. My mother took me aside: didn’t I understand that the Yugoslav embassy in London would at once hand over this letter to the secret police? (With its sinister-sounding acronym UDBA, the Uprava državne bezbednosti or Department of State Security was the bane of the regime’s critics at home and abroad). It would be obvious that my childish inquiry came from the same Oxford address where the daughter of a top Yugoslav pediatrician was living while completing her A-levels. It was bad enough that the UDBA would instantly suspect her of propagandizing about the royalist past — a crime in Yugoslavia. Worse, it would start checking up on her family history and might then discover her carefully concealed ties to the notorious inhabitant of Crotch Crescent. Her life could unravel in an instant.
This trivial episode taught me important lessons — albeit in politics not history. First, that the power of the communist state was based on the relentless, intrusive, bureaucratic reach of the security and intelligence services, and their capacity to ruin the lives of those who displeased them. Secondly, that these agencies’ reach extended far beyond their own grim dominions — even to the seemingly safe and secure world of an English university town. The extraordinary idea that my actions could put me under scrutiny by hostile foreign officials sparked an interest that has gripped me for decades. In the years that followed I devoured spy literature, from defectors’ memoirs to John le Carré’s novels. I tracked down retired spies and quizzed them. I also kept a beady eye on contemporaries who were offered jobs by MI6, as Britain’s Secret Intelligence Service, SIS, is colloquially known.
Even without knowing much about the intelligence world I was struck by the clumsiness of those approaches: on the same day a crop of identical government-issue buff envelopes would arrive in student pigeonholes. Some recipients ignored the strictures to keep silent. A friend even framed the letter and put it in his lavatory, so his friends could appreciate the unconvincing letterhead and the strangulated offer: “From time to time opportunities arise in government service overseas of a specialized and confidential nature.” For those who did apply, the clumsy efforts of the vetting officers (also accompanied by dire warnings about secrecy) were similarly corrosive of confidence in the spooks’ worldview. Did it really matter in the struggle against the Soviet empire, I wondered, if Tom had gay flings, if Dick smoked dope or if Harriet had a boyfriend in the Socialist Workers’ Party?
I reckoned I could do more good on the outside, and searched for any Eastern European cause that would accept my help. Inspired by my father, who smuggled books to fellow-philosophers persecuted in Czechoslovakia, I helped organize a student campaign to support Poland’s Solidarity movement, crushed by martial law in December 1981. I waved placards outside embassies and wrote letters of protest on behalf of political prisoners. I studied unfashionable languages like Polish, and practiced them by befriending bitter old émigrés in the dusty clubs and offices of west London — the world of le Carré’s Estonian “Colonel” in Smiley’s People. Like the spy author’s fictional émigrés, these real-life ones had been sponsored by Britain’s spooks, then betrayed and dumped.
I would occasionally take the number 12 bus down Westminster Bridge Road in Lambeth, past the headquarters of Britain’s MI6. The location was in those days, supposedly, a closely guarded official secret, though the bus conductor was prone to announce jovially “Century House — all spies alight here.” I never went inside. But I would gaze up at the grubby concrete structure, with a petrol station incongruously sited in its forecourt. Was this really our answer to the fearsome Soviet Lubyanka in Moscow? The imposing classical façade of the KGB citadel (originally an insurance company headquarters) would have suited the grandest streets in central London. But the MI6 building looked liked a scruffy Soviet tower block…
July 16, 2012
This image has been posted with express written permission. This cartoon was originally published at Town Hall.