More evidence that poverty doesn’t stop innovation: The extremely cool blog AfriGadget, about how people with limited resources solve everyday problems with large amounts of ingenuity. Constrained optimisation at its finest!

For example, check out this home-made helicopter:

(HT: Signal vs Noise)

Another example of technically sophisticated consumers undermining product differentiation strategies: The CHDK project, which is a piece of software that enables all sorts of advanced features on standard Canon point-and-shoot digital cameras.

Firms commonly re-use components between high-end and low-end products to save money and disable some of the features in the low-end models. In this case, Canon uses the same DIGIC image-processing chips in many kinds of its cameras. The CHDK software helps you to turn on the disabled features, as well as adding a scripting programming language that can be used to do all sorts of cool things like time-lapse photography.

I expect to see more and more of these cases, as consumers enabled by the Internet become increasingly sophisticated. Firms may have to rethink how they implement product differentiation.

(Via Lifehacker)

I found this picture on David Zetland’s new blog, Aguanomics:

I had a number of different reactions. One was that it’s terrible that this person is so poor that they have to use plastic bottles for shoes. They don’t look very comfy either. But the other reaction was to be highly impressed by the innovation and creativity shown. Did you ever think that plastic bottles could be used for shoes?

I came to the following hypothesis: Human creativity is not limited by poverty. Put another way, the reason why some countries are poor is probably not a lack of ideas and innovation.

Everything 2.0 catalogs new web-based businesses. There are so many! For example, 621 search engines.

One amazing thing about the Internet is the ease and speed with which new business models can be tried, tested, and rejected. That’s gotta be good for something.

Via Digg, I found an interesting dispute between Creative Labs (maker of sound cards and other multimedia hardware) and an independent programmer going by the name of Daniel_K. The full details can be read in this thread on Creative’s support forums.

What Daniel_K did was to write and release his own set of Windows Vista drivers for certain Creative sound cards. Creative’s own drivers were apparently very buggy under Vista, and Daniel_K’s drivers fixed the bugs. You would think that Creative would actually be pleased about this, since it would enable them to sell more sound cards without going to the expense of fixing the drivers themselves. However, Creative was also selling different versions of the affected sound cards with different features. It seems that the hardware on the different cards was basically the same, but for the cheaper versions Creative had disabled some of the more advanced features in the software. Daniel_K’s drivers enabled some or all of the disabled features, thus undermining Creative’s product differentiation strategy, as people could just buy the cheapest card and have the same features as a more expensive one by using Daniel_K’s drivers instead of Creative’s. On top of this, Daniel_K was also asking for donations to support his driver-writing efforts, further irritating Creative that he was making money at their expense.

Now, of course, Creative’s lawyers have threatened Daniel_K and he has promised to stop writing and releasing drivers. The interesting question for armchair lawyers is whether or not they have a legitimate right to do this. Creative claims that Daniel_K is infringing on their intellectual property rights, like any patents they might have on their hardware. I’m not a lawyer, so I can’t really speculate here, but I do know that intellectual property rights are ‘exhausted’ when a good embodying them is sold. For example, the patents that Apple has on iPods do not prevent you from re-selling your iPod or modifying it. They only prevent you from producing and selling devices that use the patented technologies.

With this in mind, it’d be interesting to hear exactly what grounds Creative has for restricting Daniel_K’s activities. However this doesn’t seem like it’s going to be contested in court. Faced with an expensive and complicated lawsuit, Daniel_K pretty much has no choice but to back down. I doubt he’s making a lot of money from donations, so the only point of going to court would be to get a moral victory, which he doesn’t seem to think is worthwhile.

In any case, the real lesson here seems to be that hardware manufacturers should not rely on crippling via software to execute a product differentiation strategy.