Sky Dayton's posterous

The insatiable need for capacity is child's play

(download)

I just received this video from my 9 year old daughter, who created it for
fun on her iPhone in two minutes and sent it to me and three of her
friends, who are also downloading it on their devices. It's 5.5 megabytes
x 4 recipients = 22 megabytes of storage and well over 100 megabits of
network transactions when overhead is included. Double all of that for
cloud backup.

I doubt the original architects of the Internet could have envisioned the
network being used for this purpose, but here we are. This and a million
other uses we can't see yet from here. As an investor and entrepreneur,
I'm long the anything that satiates the need for fatter pipes and more
storage in the cloud: @boingo and @gobbler.

How I survived the Valentines Day Massacre of 1995

It was early 1995, and EarthLink was in one of its earliest growth periods. We'd just moved from our first 800 square foot office in Los Angeles to a 3,000 foot space down the hall in the same building. Even then, we quickly filled the new office, and people were sitting at desks in the hallway. We were adding subscribers at a rate faster than we could handle, sometimes growing 10% a week, and our systems were straining under the demand. We were barely managing to keep up.

Then, on February 14th, 1995, our main subscriber database — the file that held the usernames and passwords — got totally corrupted, and suddenly, we could no longer authenticate our users when they dialed in. (It was modems in those days, remember.) EarthLink was completely down. Fortunately, we had a back-up tape at the office that was only a few days old. Our engineers went to load the tape and restore our system. We would be back on in an hour, still a horrific outage, but survivable. Then, we discovered that the back-up tape was damaged and totally unreadable. We were dead in the water. If we couldn’t figure out how to get the data off that tape, EarthLink would be out of business, and I would be back to running a coffee house.

I put the word out to everyone I knew for a data recovery expert. An EarthLink customer referred me to a firm in San Diego, and within minutes, the damaged tape was speeding south in a car. We fielded calls from angry customers while waiting anxiously for news. Many hours later, we received word that although some of the data was was lost, most of the information on the tape had been taken off bit-by-bit and reconstructed. We were saved! The recovered file was loaded onto a hard drive and driven (there was no Gobbler back then) back to EarthLink's offices in LA. Our engineers stayed up all night and got us back online.

At EarthLink, February 14th, 1995 became known as the Valentines Day Massacre. We survived, and although our customers were rightfully angry with us, I think they also sensed that this was the early days of the Internet. Stuff didn't "just work" the way it does now. The next day, our modem banks were once again full of happily connected EarthLink customers. And I was back to figuring out out to hire and expand faster to keep up with demand.

Like many start-ups, there times in those early days at EarthLink when we were up against seemingly insurmountable obstacles. But we knew we had something that people wanted, so we kept going, forging ahead despite it all. Being successful, especially in a start-up, is all about perseverance. 

For a future post: How we blew up our building's power transformer and ran EarthLink for two months on a generator in the parking lot.

Madison Avenue still hasn't caught up to Main Street

This has always been one of the most poignant comparisons in the Internet world, updated recently by Mary Meeker. TV has 31% of consumer media time and 39% of ad spending. Print gets 12% of consumer media time but a massive 26% of all ad spending. The Internet? 28% share of US consumer media time, yet a paltry 13% of ad spending. When looked at globally, that gap is worth $50 billion. This is an imbalance that won’t last.

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Read the full presentation here: http://techcrunch.com/2010/11/16/ten-questions-internet-execs-should-ask-and-answer/