Disclaimer: I'm a skeptical audiophile, i.e. I love high-quality sound, understand the placebo effect and raise my eyebrows (but not my credit card) at $15,000 speaker cables.

What I find most fascinating about all of this is that the human body is not subject (yet) to Moore's Law. Computers catch up to us, fast. So, while 16-bit 44.1kHz audio was impossible in terms of processing power and storage 20 or so years ago, now it's trivial. At some point, anyone will agree that the resolution of music recordings exceeds the listening capabilities of even super-ears folks. 192kHz 24-bit stereo audio, uncompressed, is only ~4GB per hour; a trivial amount of storage and a very low data rate. Make it full 7-channel just for giggles, and it's ~14GB/hour. So a run-of-the-mill (today) 4TB drive can store ~300 albums. A typical audiopohile collection of 5,000 albums will require 70TB of storage, 100TB if you want some RAID redundancy, and that's with no lossLESS compression. Today that's $8,000 of storage, and it takes no imagination, plus 0.6x conservative lossless compression, to get that down to $2,000 or so. Not cheap, but not outrageous. The albums themselves cost said audiophile about $75,000.

Will there still be a debate that 192kHz 24-bit isn't "enough"? Probably. But human ears aren't changing much, and, it could be argued, we hit the limit of perception for most people at 44.1kHz 16-bit. At 6.5 times that resolution, it's probably enough. Problem solved (modulo a lot of infrastructure changes).

The same will eventually happen for video. 8x, if you've ever seen it, is like looking through a window, until the camera pans (which it shouldn't). Many people can't tell the difference between 480p and 1080p, never mind 4x.

It's already happened for photography. The resolving power of modern high-end digital sensors exceeds that of all but the best lenses. Storage of these multi-megapixel images is a non-issue.

There are imponderables, though: passionate, intelligent and sincere people I know wax lyrical over the aforementioned $15,000 speaker cables. Sound reproduction in a home environment, or when hearing headphones, is extraordinarily complex, and nobody has ever achieved "the absolute sound", i.e. a feeling that you're in a live music environment when listening at home. All you can hope for is some of the emotional involvement that the recording artist intended, whether in the studio or live. In the car on on good earbuds, I can JUST about tell that I'm listening to a 192 or 256kbps AAC (or MP3): it's in the sizzle of a cymbal and the like. But it's a fine line. At home, sure, a good audio system can make you cringe when listening to a highly compressed source. I've ABed the same recordings at 44.1/16 and 96/24. On high dynamic range stuff (orchestral, mostly), the quiet passages show a difference, albeit a minor one, because the signal is encoded using only 2-3 LSBs.

What's hardest to understand is the emotional engagement offered by (good, well-recorded, well-pressed) vinyl. It could certainly be a placebo effect, or it could be something yet to be understand in human hearing response when listening to digitally-encoded audio. To my surprise, the difference between a $10 speaker cable and a $500 speaker cable is clear, and in the favor of the $500 cable. There's some science there, but also a lot of voodoo. One or two manufacturers claim to have figured out how to measure the difference, but they're not saying how, for obvious reasons: they're, um, "marketing", or they really have found something to measure and want to keep it proprietary.

Finally, audio technology is really advancing, and fast. The DACs in most iDevices are ok: not great, but ok. The bundled earbuds are bad. But as little as $30 gets you decent earbuds. At $100 you're experiencing perhaps the same quality of sound as from a $1,000 pair of speakers. A decent DAC can be had for $250. A decent headphone amp for $200. So Mac/PC (which you already have)+$250 DAC+$200 amp+$100 earbuds gives you sound far superior to what most people enjoy. Not free, or cheap, but not very expensive, either. Then, I bet, a lot of people will want to move up from 128kbps MP3s.

I read the CEO letter with some amusement, because some of the same thoughts have crossed my mind in the past. It's a pity that he diluted some good points by sounding rude and arrogant.

I've worked with French entrepreneurs (when I worked in Silicon Valley venture capital) and with French offices (when I've worked for global/international companies). I've directly managed people in France. Like most countries, there is an underlying culture, but it's not homogeneous. So, yes, I've witnessed French workers with a sense of entitlement and a desire to get as much money as possible in return for as little work as possible. This is not unique to France, but the local labor laws are such that they can be gamed to achieve that effect more than in many places. Between mandatory 35-hour work weeks, seemingly endless public holidays, "stress leave" (which can be due to genuine stress, or because you don't like your job/boss/whatever), 25+ days of paid vacation and labor laws that make it very hard to manage performance, it's a tough place to get real productivity. The last point is the toughest IMHO.

Before you get all bent out of shape that "management" means exploiting workers, it doesn't (have to) mean that. It means being able to reward hard work, diligence, self-improvement and great results with training, promotions, coaching and, yes, money. It also means being able to correct laziness, sloppiness and lack of effort with training and hands-on help, and to be able, ultimately, to fire people who don't want to put in the effort. You know who appreciates management firing poor workers the most? The other workers around them. A labor law climate that makes it hard to manage is really poisonous. Do you think that companies most of us admire, like Apple or Google, tolerate poor performance?

What's interesting is that many French workers I know complain about this, and the clock-watching attitude, and dislike it.

You know what? Many of them leave the country, because they can't stand it. Some drive across the border to the French part of Switzerland, which has fairly strict labor laws, but a different work ethic. The tech entrepreneurs come to Silicon Valley; the Valley is full of them, starting companies, raising money and creating value. In the US for the US. Not for France.

Clearly, in the long run, this brain drain isn't good for France. But the underlying culture of entitlement prevents serious reform.

You're right, and a large part of the additional cost of doing business in the EU is because.......everything costs more; businesses buy stuff and services, too. Like Adobe software! How's that for getting back to the topic?

It's a vicious circle. There are large costs of doing business in parts of the US, too, such as in California. Regulations and taxes push up prices there, too, compared to much of the rest of the US. I just got my water bill here in NC: $28 for the month. Same usage in CA used to cost $100. Trash is $15 versus $50. Just because and because of regulation.

As for getting sued: the US government does it less than the EU, but the US plaintiff's bar exacts a toll on business. How many letters do you get telling you that you're a part of a class action suit and that you'll eventually receive a check for $2.89 and that, by the way, the reasonable attorneys' fees for the case will be $10M?

Yeah, that's another thing that I noticed when I came to the US: people have an enormous amount of stuff in their enormous (by UK standards) houses. Even after 22 years in the US, I still can't get over how much stuff is available, and how little it costs. Don't get me wrong: I like stuff. But it's overwhelming how much stuff there is.

You highlight a real US problem, though: people not understanding the time value of money. It's not taught in the schools, AFAIK. This leads to living on credit (which is astonishingly expensive, if, like most people, you use credit cards) and living for "now" versus "the rest of your life". Try explaining to the average person that waiting a few months to save for something saves you 10-80% of the long-term cost (depending on how indebted you are). The classic symptom of this: a car dealer asking you what monthly payment you're looking for when you walk onto the lot. And there are insidious money-sucking prices in the US, too: what the average home spends on healthcare, mobile voice/data and cable/satellite is just incredible. And every marketing genius has figured out the recurring revenue model and many households fall for it, e.g. Sirius/XM for your car(s).

While digitally-delivered software is an egregious example of price gouging, it's hardly unique. Sure, Australia is a long way away from most places and it's a very small market (about 22M people). So it's understandable that some goods will cost more, especially if they need local parts and supports: think cars, or even computers (but not bits). But, despite the pervasiveness of the internet, price differentials still exist FAR in excess of those caused by local taxation and tariffs and market sizes.

The US has it very, very good indeed. Why does, say, an Audi cost 30-40% less in California than in Germany, after you remove taxes? Same car (modulo some safety marks molded into some of the parts and other minor differences), same warranty, same service. The only difference is that it spends a few weeks on a boat instead of a few hours on a truck getting to the dealer. Why do the same Chinese-manufactured clothes cost, in some cases, 3-5x more in Switzerland than at Macy's anywhere in the US? How come that Japanese cameras are 30% cheaper in the US than in, say, the UK, or even in Japan?

I think that part of the answer is cultural. As an emigree to the US (22 years ago), one of the things that I first noticed was the national obsession with getting the best price on everything, almost regardless of personal wealth. Americans simply won't put up with price gouging. The clerk at Macy's will take some time to stack coupons and discounts for you to give you the lowest price. People actually negotiate the prices of many things with the seller, e.g. cars. In the UK, a favorite phrase was "if you have to ask the price, you can't afford it", which was a not-so-subtle tactic to make you feel somehow inferior for wanting a discount. And I will always remember the look on an American friend's face when, at a UK breakfast place, she asked for a refill of her (tiny) coffee cup and was told that it would be an extra 2 pounds. Try that at any restaurant in the US and witness the riot.

The internet simply causes resentment and envy when people in less fortunate places browse US sites. A lot of people simply order from the US and deal with the customs and shipping hassles (and, sometimes, the lack of local warranty). My Swiss friends bring empty suitcases on trips to the US and fill them up at Best Buy and Macy's; the Swiss tax on bringing stuff in for personal use is very low. I saw one billionaire (literally) friend from Switzerland buy a box of batteries at Best Buy because they're so expensive in his home country.

I can confirm that the takeoff afterburners were very loud. I used to live in the UK, in Teddington, about 10 mles from London Heathrow airport (LHR). When Concorde flew overhead, on departure, it was EXTREMELY loud. It was a great sound, with some of the "crackling" you (used to) hear at a shuttle launch. But it was really, really loud and noticeably louder than the usual fare of 747s and smaller airliners. Concorde was at about 2,000 feet when over my old home. So, on takeoff, it was affecting thousands of homes with the noise. That wasn't an issue on departures from coastal cities like New York, but it was a major source of annoyance in London.

I flew Concorde twice, and still have my photos of the in-cabin display showing Mach 2.0. The one-way fare from London to New York, in 1981, was about UKL1300 (about $2500 back then). To put it into perspective, a coach seat from London to New York in those days was sometimes as low as $150. The seats were relatively small, as were the windows, and the wall got quite hot to the touch. A good meal served during a short flight, and it was cool to arrive in New York about 2 clock hours before I left London. Those were the days when you could visit the cockpit, and it was very cramped, very steam-age with all-mechanical instruments, two pilots (of course) and an engineer. Amazing for its day.

I may be close minded, and even may have a small mind, but I DID say in my post "arbitrary data sets". One of the tests of crazy versus not crazy lossless compression types is that the crazy ones claim lossless compression of all arbitrary data sets. The reductio ad absurdum argument is then that, of course, you can keep applying it until you end up with one bit representing all possible expanded data sets.

Not one of them ever took me up on the challenge of me giving them a 100MB file of arbitrary data (a Truecrypt container is a good example) and compressing and decompressing it on different non-networked machines (carrying the compressed file between the machines using sneakernet). Not surprising.

There are GREAT compression schemes for non-random data. ZIP and FLAC, for example. If you restrict the problem to, say, English text, the possible lossless compression factor is impressive.

I got to see a lot of these compression companies because I invested in LOSSY compression for video. Now that's really interesting stuff: you can throw away almost all of the data (more than 99%) and still end up with something that is visually lossless to most people. Even in this space, there are crazies and charlatans. I saw quite a few companies claiming "HD quality" (whatever the heck that is) at well under 1Mbps data rates.

Those are indeed the people I meant in my post. I will never forget a meeting (before my VC days, at a tech startup) with a particularly aggressive lossless compression guy, who went as far as to say that you can keep using the compressor to further reduce compressed data. His particular compressor provided 10,000:1 lossless compression. So I asked him "you mean I can give you a 600MB CD with arbitrary data on it, you can run your compressor twice, and give me 6 bytes? Then you can run your decompressor twice and give me back the 600MB of arbitrary data?". He looked me in the eye and said "yes, that's right".

The really amazing thing is that the company showed up on Slashdot about 10 years later, having raised a bunch of money, including some government grants. Sigh.

Exactly right. As a VC, you don't just throw money against the wall and hope to get lucky; you try to make your own luck.

The experience of the team is important, but that varies by space. If the company wants to build, say, a new power-management semiconductor, you should have someone on the team who's done something like that before, and someone who has connections to possible customers. If, however, you're building a social networking web site, like Facebook, all that matters is the drive, vision and smarts of the CEO and the team that (s)he assembles. You also need a lot of luck, but smart people have a way of making their own luck.

A lot of focus is on the CEO. If (s)he can attract, hire, motivate and lead strong people, that's most of the battle. I worked at Sun in the early days. Scott McNealy was not an experienced leader: he was a manufacturing manager at a Unix box company, and then came to Sun. We were all in our 20s. But Scott did one thing above all others that made the company successful: he hired the best people into key roles like R&D, Sales, Marketing, Manufacturing. He was a first-time CEO. Others that come to mind are Ken Olsen (DEC), Steve Jobs (Apple), Larry Ellison (Oracle), Mark Zuckerberg (Facebook), Reid Hoffman (LinkedIn).....the list goes on. They all hired great people onto their teams.

Oh man, this is a hard one. I was a VC for almost 8 years, and made a point of giving feedback, because I'd done 6 startups before, and knew how frustrating fundraising can be. There's nothing worse than being turned down (or ignored) with a BS reason, because you can't learn from it.

If the reason was "I don't understand your space and so can't add value", or "We don't invest in companies at your stage" or "We already have a competitive company in this space", it went down ok with the entrepreneur(s). If it was "I don't have confidence in the market opportunity" or "I think that there's too much risk in your technology (this never applies to software, but often applies to new semiconductors, batteries, alternative energy and the like)", it sometimes annoyed the entrepreneurs.

But, if the reason was "You're not the right CEO", oh, boy, it usually went badly. The problem was, that was the most common reason.

Worst of all were the crazy people. #1 on the crazy list are the "lossless compression" types. Even taking them through the math that, of course, no compression scheme can reduce all arbitrary data sets (n bits can only represent 2^n different data sets) had no effect. They also tended to get the most annoyed when I turned them down. #2 was the astonishing number of entrepreneurs who would present business plans showing revenues over the next 4 years of $1M, $10M, $100M and $1B, with >95% profit in that 4th year. Telling them that they simply had no idea about how to run a business also went badly. You could invent matter transmission and not get that kind of profitability.

There's another reason that VCs don't always give feedback: they don't want to miss the deal if another VC decides to invest. Maybe that other VC sees something unique, or has a plan to replace the not-good CEO, or something else. VCs really hate it when they invest in a company and it all goes to hell, and they lose their investment. They hate it even more if they turn down a deal and someone else makes a fortune on it. Some of the more self-effacing (and hence more likeable) firms will post on their sites a list of the great companies that they turned down. A lot of people turned down Google and Facebook, for example.

I still think that the best way is to give honest feedback, without being offensive.