Virtualisation is bringing us back together

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(Image by Chris Drumm)

Back in 1953, Isaac Asimov’s “The Caves of Steel” was published, depicting a world of avatars, virtual collaboration and video-conferencing. It took the real world half a century to catch up with him. Asimov was a smart guy.

But he got one thing wrong. Asimov predicted that reliance on these forms of communication would make us terrified of meeting each other in person. Instead, research has shown that social media is often used to identify new and interesting people to meet in real life (see this article from the American Public Broadcasting Service, for example). In fact, this is exactly how I met my wife. More recently, I’ve enjoyed meeting @Sanfire_IA and @NewOptimists, amongst others, firstly on Twitter (go look them up), and then in real life. (In coffee shops, to be precise).

Tim Stonor and Dan Holowack have both written very interesting blog posts recently about the important role cities play in bringing people together, face-to-face, to create and share ideas. It’s the very lifeblood of the economy. (Edward Glaeser’s “Triumph of the City” discusses this topic in great and fascinating length).

The technologies that connect us virtually have a very important role to play in that aspects of our cities. I’ve met recently with people in cities including Birmingham, London and Sunderland who are involved in stimulating innovation and entrepreneurial activity in city economies. They are all passionate about the value that is created when creative people with disparate skills are brought together.

But they were also unanimous in voicing a concern that it’s tremendously difficult to persuade such people to take time away from the businesses they’re spending 60, 80 or 100 hours a week starting and running to meet people they don’t know; on the off-chance that a valuable new business idea will somehow spring into existence.

All of us face that challenge to some degree today. With the explosive growth in the flow of information we’ve experienced over the last 20 years or so, competition for our time and attention is intense. Social media is a significant part of that explosion of course; but it’s also a significant part of the answer.

Within a few minutes, on Freecycle I can find people near me who need what I no longer want; on LandShare I can find people whose untended land can be used to grow food, and on StumbleUpon I can find moments of genius in every domain from places I’d never in a million years have thought to look, but which StumbleUpon’s fuzzy search engine has ensured are nevertheless relevant to me. And then I can get in touch, arrange to meet, and find out more.

(I have deliberately chosen some of these examples, by the way, for their relevance to the efficiency with which natural resources are used to support economic activity. The recent “People and the Planet” report written by an incredible array of international experts on behalf of the Royal Society should leave us in no doubt at all of the importance of that topic).

This morning, I’ll be attending Birmingham’s Social Media cafe following a discussion about innovation in Birmingham in a Linked-In group, to discuss ideas for social business with people who I haven’t met before, but who I will probably soon be following on Twitter. That’s a great example of the interplay between virtual and physical interactions that’s speeding up the process of collaborative innovation and value-creation in cities today.

But it doesn’t stop there. Digitisation and mass customisation are long-standing trends in manufacturing, but technologies such as 3D printing are going to transform custom-manufacturing in the same way that global-sourcing and production line automation relatively recently transformed commodity manufacturing. And as this brilliant article in The Economist argues, the result will probably be to bring manufacturing activity back to be more local to the consumers of the goods being manufactured.

I turned 40 recently; traditionally a landmark that brings a certain degree of questioning of one’s direction in life. I have no such questions. The family that I now have after meeting my wife through social media is the most important part of that; and the privilege of living through these incredibly exciting and transformational times is the icing on the cake. I can’t wait to see where we’ll go next.

The world is at our childrens’ fingertips; and they will change it

(Image by TurkleTom)

Several of my recent posts to this blog have been concerned with two sides of the same coin: the importance of science and technology skills to our societies and economies; and the importance of making technology and information consumable and accessible.

But this is the first time I’m putting those concerns to the test in the very act of writing my blog – which I’m doing using the iPad that arrived 3 days ago.

My last purchase from Apple – a company whose controlling approach to technology and media ecosystems I don’t admire – was a 3rd generation iPod; it’s now so unusually old that I’m often asked if it’s some strange *new* gadget. I was very unimpressed by the speed with which that iPod’s battery deteriorated, and by the impossibility of replacing it. So I needed some considerable persuasion to shell out several hundred pounds on an iPad.

That persuasion came from my 3 year old son. On the (very rare, if you’re my boss reading this) occasions that I work from home, I sometimes share my laptop screen with him. My side has my e-mail on it; his side has Thomas the Tank Engine on YouTube (he gets the better deal). Often when I launch a new window, it pops up on his side of the screen, obscuring whatever’s going on on Sodor. His immediate and instinctive reaction is to touch the screen and try to drag the obstruction out of the way.

(I heard an amazing corollary to this from a contact at Birmingham City Council yesterday – she’s seen her toddler drag her fingers apart on the surface of a paper magazine in an attempt to “zoom” the pictures in it!)

I’ve just written an article that repeats an often quoted though hard to source statistic that 90% of the information that exists in the world today was created (or more accurately recorded) in the last 5 years.

That made me think that: every fact in the world is literally at the fingertips of our children.

You can argue whether that’s literally true; and whether it’s equally true for all the children in the world (it’s clearly not); but there’s a deep and fundamental truth to the insight that suggests: however much we think the technologies we use today have already changed the world, it’s absolutely nothing compared to the utter transformation that will be created by the real “information natives” that our very young children will become.

That’s why I shelled out for an iPad this week. Love Apple or loathe them, they are creating technologies that offer us – if we explore and engage with them – a window into an important part of the future. And if we want to help our children, our schools, our businesses and our cities prepare for that future, then we had better do our best to get to grips with them ourselves.

How will the UK create the skills that the economy of 2020 will need?

(Photo by Orange Tuesday)

I’ve been reading Edward Glaeser’s book “The Triumph of the City” recently. One of his arguments is that the basis of sustainable city economies is the presence of clusters of small, entrepreneurial businesses that constantly co-create new commercial value from technological innovations.

Alan Penn, the Dean of the Bartlett Institute for the Built Environment, made similar comments to me recently. Interestingly, both Alan and Edward Glaesar identified Birmingham, my hometown, as an example of a city with such an innovative, marketplace economy, along with London. They also both identified Manchester as a counter-example of a city overly dependent on commoditised industries and external investment.

Cities are fundamentally important to the UK economy; more than 90% of the UK population lives in urban areas. But many – or perhaps most – UK cities are not well placed to support innovative, marketplace-based, high-technology economies (see my recent post on this topic). For example, e-Skills UK report that less than 20% of people hired into information technology positions in the UK acquired their skills in the education system; and I agree strongly with Seth Godin’s views as expressed by the “Stop Stealing Dreams” manifesto that we need to question and change the fundamental objectives around which our education system is designed.

To create and / or sustain economies capable of organic innovation and growth, cities need a particular mixture of skills: entrepreneurial skills; commercial skills; operational skills; technology skills; and creative skills. The blunt truth is that our education system isn’t structured to deliver those skills to city economies with this objective.

Whilst the opinions I’ve expressed here are personal, I’ll shortly be launching a project at work for my employer IBM to look at the challenges in this space. IBM’s business interest is our need to continue hiring smart, skilled people in the UK; the interest of IBM’s technical community as individuals to commit their time to the project additionally involves personal passion for technology and education.

I’m enormously aware that I’m not the first person to whom these thoughts have occurred; and I know that I and my colleagues in IBM don’t have all the answers.

So if this topic interests you and you’d like to share your insight with the project I’m going to run this year, please let me know. I’d very much appreciate hearing from you.

Who will be the next generation of technology millionaires?

(Image: “IT is innovation” by Frank Allan Hansen)

A few years ago I attended a dinner debate hosted by the British Computer Society about the future of technology careers in the UK. At the time, I’d recently written a report for IBM UK on the subject. The common motivation was to explore the effect of globalisation on the UK’s IT industry.

Despite the continuing emergence of high quality technology industries around the world, the local demand for technology skills in the UK was then, and is now, increasing. The secret to understanding the seeming contradiction is twofold.

Firstly, consider which specific skills are required, and why. To cut a long story short, the ones that are needed on-shore in countries with high wages such as the UK are the ones most closely tied to agile innovation in local economic and cultural markets, or to the operation of critical infrastructures (such as water, roads and energy) or operations (such as banking and law enforcement).

Secondly, the more fundamental point is that we’re living through an Information Revolution that is increasing in pace and impact. That means the demand for science, technology, mathematics and information skills is going through the roof across the board. As  evidence, consider this article from McKinsey on the hidden “Information Economy”; or the claim that 90% of the information in the world was created in the last two years (widely referenced, e.g. by this article in Forbes); or that IBM now employs more mathematics PhD holders than any other organisation in the world.

At the BCS debate, a consultant from Capgemini introduced the evening by describing his meeting that morning with a group of London-based internet entrepreneurs. These people were young (20-25), successful (owning and running businesses worth £millions), and fiercely technology literate.

Today, I wonder if the same meeting would be held with internet entrepreneurs? In ten years time, I certainly don’t think it will be – they’ll be genetic engineers, nano-technologists, or experts in some field we can’t imagine yet. Of course, there are already many early entrepreneurs exploring those fields, as was shown in Adam Rutherford’s recent BBC Horizon documentary “Playing God”  (see this video or this review).

I’ve blogged recently about the importance of skills, education and localism to the future of our cities’ and country’s economies. This leads me to believe that more important than addressing the UK’s shortfall in IT skills (as reported by e-Skills last year) is understanding how to systematically integrate the teaching of technology, science, creative and business skills across schools, universities and vocational education. Further, that needs to be done in a way that’s responsive to the changes that will come to the sciences and technologies that have the most power to compliment the unique economy, geography and culture of the British isles.

This is already a problem for the UK economy. The e-Skills report found that UK businesses are nearly 10% less productive than US ones; and that 80% of that gap is down to less effective use of technology. Their research predicts that closing the technology gap could contribute £50bn to the UK economy over 5-7 years. But their finding that the British Education system provides less than 20% of the technology skills we need today means that closing the gap will be hard.

As the information revolution proceeds, the problem will get worse. And unless we do something about it in an enlightened way that recognises that the science and technology skills we’ll need in 10 years time are not the IT skills that are familiar to us today, we’ll fail to address it.

I was born in 1970; for me, the Tandy TRS80 computer my family bought in 1980 was a technological marvel, with its 16k RAM and graphic resolution of 128×48 pixels (all of them green). Today, my 3 year old son is growing up with a high resolution smartphone touchscreen as an unremarkable part of his world. By the time he’s of working age, the world will be unrecognisable – as will the skills he’ll require to be successful in it.

From the earliest years, we need to be exciting children in the mixture of creativity; abstract thinking and modelling; mathematics, technology, art and entrepreneurialism that are apparent now in such forums as TED. (www.ted.com). Whatever their interest and acumen, we need to give them the opportunity to find their own niche in that range of cross-disciplinary skills that will be economically valuable in the future. If we don’t, they won’t be ready to find jobs in the industries of the future when the computer programming industry, and others as we know them today, disappear.

This week’s reading

Some great reading this week on technology, the economy, banking and smart transport … plus a little humour …

And on a lighter note:

Social media – a reminiscence

Since June 2007 I’ve had an incredibly interesting job with IBM exploring the possibilities of social media and some of the other internet and related technologies that have emerged recently. I was first asked by Graham Spittle, who was then the Director of IBM’s Hursley Software Development Lab in the UK, to go and work with our customers to get a better understanding of what “Web 2.0” meant to them, and what it meant for how they would use our products.

One of the key things I learnt was that it’s pretty impossible to get hold of what Web 2.0 “is”. I quickly started to think of it as “everything that’s been done with internet technologies since the dot.com crash”. That tallies with O’Reilly Media’s 2003 coinage of the term as the name for a conference intended to revive business interest in the internet (see Tim O’Reilly interviewed by CNNMoney.com in 2007).

In 2007, Web 2.0 was already old hat in internet circles – and is much more so now. But for many “traditional” companies it was and remains something new, intangible, exciting, scary … but also, for its own sake, often irrelevant.

Do I really mean irrelevant? Not quite … I’ll explain with my personal conclusions and predictions for “Web 2.0” …

1. “Web 2.0” is an irrelevance to businesses …

Web 2.0 is best viewed as a banner term for the collection of internet-enabled technology, commercial and social phenomena that appeared between 2003 and the present time of writing. I don’t think that timeframe will expand much further for reasons that will become clear.

That definition covers such an incredibly broad area that in total it never has and never will be of interest to anyone other than technologists of one variety or another. “Web 2.0” is not relevant to any individual business (with the possible exception of Web 2.0 consultancies) – but elements within it are highly relevant in wildly different ways to (arguably) all individuals, businesses, communities and other organisations.

For those reasons, most organisations I talk to are not interested in “Web 2.0”, and many are frankly bored by the number of people who want to talk to them about it. However, they are very engaged by the way specific developments in internet technology are affecting their businesses and their industries.

2. … but does describe a period in history during which individuals, businesses, governments and social organisations harnessed an incredible variety of new technologies …

Depending on the client I’m working with and the area of their business we’re discussing, I’ll talk specifically with them about communicating intimately with their clients through social media, using Enterprise Mashup technology to create rapid, content-driven applications,  using community effects to create and commercialise new interactions in their ecosystem, using “Web-Oriented Architecture” to deliver scalable online content and services in an easy-to-consume form … etcetera. Our clients are exploring all of those possibilities – sometimes under the banner of Web 2.0, sometimes not.

For example, mobile telephone service providers maintain enormously expensive communications infrastructures that enable us to use our increasingly capable handsets to access a multitude of third-party applications and content in ways that do not necessarily deliver significant extra revenue to them. Conversely, they have a set of capabilities not easily replicable in an integrated manner elsewhere in the online world: they identify us through our SIM card; they bill us through our accounts with them, and the financial information we trust them with; they locate us through the cell network; and they can identify our friends, family and contacts through the entries in our address books. As a result, these organisations are investing huge energy exploring the potential of multi-platform social applications and gadgets that use these capabilities to create revenue-generating traffic through network subscriptions, data bandwidth usage, application licenses or transaction fees.

3. … and represents an ongoing fundamental change in the social and economic organisation of the world …

I really believe that the world is changing through this process. Web 2.0 didn’t start this – the Grameen bank, for example, have been harnessing (and creating) these ideas to enable microfinance to benefit the developing world since 1997. But the wave of activity and technology development driven by the evolution of the internet and represented by Web 2.0 has in many cases demolished the cost and difficulty involved in connecting people around the world with complimentary interests, and enabling them to interact with each other. Some examples:

  • Microfinance (e.g. Grameen, Kiva) – greatly increasing the ability of millions of people with not much to give to chose exactly how their donations are used to directly benefit those in need.
  • Online marketplaces (e.g. eBay, Amazon) – greatly increasingly the fluidity with which resources such as second hand goods are exchanged for cash, bartered, or given freely.
  • Collaborative business models (e.g. Threadless, Zopa, Zuda Comics) – directly connecting anyone with the ability to create clothing, music, video entertainment, comic art, handmade goods and many other products, with the people interested in consuming them, wherever they are, and no matter how few or many they be.

I’m passionate about this aspect of Web 2.0. I blogged recently about the combined impact of the current economic crisis and the environmental challenges we face, inspired by an excellent special issue of the New Scientist magazine. The implication is that we are in great need of these new models of economic interaction and resource optimisation to support a growing population with rising expectations on a finite planet.

4 … enabling individuals to interact without the aid of traditional organisations …

Consider peer-to-peer lending. Zopa in the UK have shown tremendous growth in recent months (see my previous blogpost). Zopa provide introduction, vetting and bad-debt recovery services to individuals wishing to enter into agreements to borrow from or lend money to each other. Internet technologies make the introduction part incredibly cheap.

That simple model replaces part of business of traditional Retail Banks or Building Societies, wherebv product design, sales & marketing, branches, call centres and a huge number of other operations are used to persuade and enable savers to deposit funds and lenders to request them on a sufficient scale that a regular operating margin and sustainable business model can be created.

Is it a huge business? Not yet. But is it interesting and growing fast? Definitely. Read this great post from the Financial Services Club’s blog for a balanced picture.

Online marketplaces enable a similar model: small traders using them can leverage a global infrastructure to reach markets they couldn’t dream of a few years ago; and by using the brand and reach of the parent marketplace, they don’t need to be experts in online marketing to do so.

5 … creating challenges and opportunities “traditional” organisations to reinvent themselves – or just evolve.

Newspapers. Record companies. Book sellers. Filmmakers. Software companies. Electronics retailers. Banks. Mobile telephone service providers. It’s easy to find news and opinion pieces every day citing the struggle these organisations are facing as the internet evolves – and the opportunities they are presented with.

And for sure, some of this is serious. In Tribes, Seth Godin wrote a great description of the way cheap music recording, production and distribution technology has undermined every aspect of the traditional business model of a music company. As a result, many traditional companies are struggling to get to grips with the new world, whilst newcomers such as iTunes flourish.

In other areas, the picture is less clear. Traditional media organisations such as broadcasters and newspaper publishers have seen advertising revenues plummet in their traditional channels as advertising spend shifts online – these revenues are the basis of their business models.  But they are – faster or slower, for better or worse – evolving their business models to embrace and commercialise the online world. The Daily Telegraph, for example, made great use of Twitter in covering the G20 summit.

Am I predicting imminent collapse for vast numbers of businesses? Not driven by the internet, no (current economic conditions are a different matter). But do I expect that in 5 and 10 years time we’ll see not just a different set of companies dominating the industries we recognise today, but in some cases a completely different set of industries themselves? Absolutely. Are Google today a dominant technology company, or a dominant media company? How do you breakdown a world in which the same digital content is accessible on your TV, PC and mobile and embedded in your MySpace page? We’re about to find out.

Moving On

As I’m moving on from my current role, I have a sense that the world is (finally) moving on from Web 2.0. Unlike Service-Oriented Architecture, the last sweeping trend to affect the technology world, I don’t think Web 2.0 will stick around – unlike SOA, it doesn’t have a cohesive, innate structure. And I don’t think it will be replaced by “Web 3.0” either – the internet was only created once, it will only ever cause one fundamental economic crash caused by the hype following that creation, and it will only ever emerge from that crash to be called “Web 2.0” once.

From here, a whole plethora of internet-enabled technologies, ideas, applications and models of commercial or social interaction will evolve along their own separate paths. The generation of people who grew up with a globally connected internet as a completely normal part of the everyday world are already inventing new forms of communication at a faster rate that ever seen before on this planet, and all of them, and those who seek to exploit them, will suffer their own individual trials and tribulations.

What I’ve learnt is that what’s interesting to me is not so much the technology, but the individual and organisational behaviours that affect its adoption and usage. It’s those thoughts that I’ll take into my new role, which whilst it won’t be focussed around Web 2.0 or any of its elements, will doubtless involve them – and many other new and exciting developments – in some way. More about that later.

For sale: one economy, slightly used

In a couple of previous posts (here and here), I’ve written about the effects I expect to see social media have on the financial services industry – particularly retail banking and insurance – this year. The reason I expect to see companies in the industry explore social media is the need to re-establish themselves as being trustworthy by interacting with their customers in an open and trustworthy way – something social media can be perfect for (See Christophe Langlois’ discussion of VanCity’s “Change Everything”, for example).

However, there is a deeper question to ask concerning not just how financial organisations regain trust, or even how to regulate their behaviour to avoid a similar crisis in future:  the question is whether our current economic system is set up to achieve the right objectives at all. My previous posts contained links to some articles exploring this theme, but Umair Haque at the Harvard Business School has just posted a much more direct call for a “Smart Growth Manifesto” on his blog.

Umair’s post echoes a special issue New Scientist magazine ran back in October on the theme “the Folly of Growth”. Articles in the magazine argued that current expectations of continuous economic growth (a trend that, until now, has withstood periodic recessions) cannot reasonably continue, on the following basis:

  • Each dollar of GDP value can be associated with an estimate of the resource consumed in its creation.
  • Even assuming a relatively modest rate of future growth, at the current level of resource usage / $ of GDP, and at the current level of reduction in that figure, we will rapidly run out of resources.
  • If the expected rate of growth is increased to reflect one of the benefits of growth often cited by free-market economists – i.e. an improvement in living standards in emerging and developing economies driven eventually by growth in developed economies), then we run of resources incredibly fast.

One of the New Scientist articles went on to calculate an answer to the following question: if we want to drive economic growth at that level, how much more efficient do we need to become at utilising natural resources to achieve it?

The answer (based on their assumptions) was frightening: 5 times better to achieve modest growth; 50-100 times better or more if our goal is to lift the entire world to an equivalent standard of living to that enjoyed in today’s United States.

There are, of course, a huge number of assumptions behind those figures, not to mention questioning the basis on which “standard of living” is measure (i.e. to what degree is the quality of life of someone in the U.S. or anywhere else determined by their consumption of economic or environmental resources?).

However, to me the message is clear, we must be driven by goals that are not entirely based on monetary growth. As individuals, of course, that’s true already (Mr. Madoff and his like excepted); what we need to see now – as Umair has pointed out – are economic systems that reflect that.

This week’s reading: the future of banking

I’ve been spending time recently speaking with clients and colleagues about the ways in which some of our banking and finance customers might seek to exploit technology this year in the wake of the credit crunch. The Finanical Services blog, FSA and others are predicting a string of measures to reduce costs and implement compliance to new regulatory requirements – all of which will involve expenditure on technology. Some of the same sources are also predicting a simultaneous exploration of social media or other innovations exploiting new technology aimed at re-building trust with consumers and increasing business in new channels.

I’m expecting to see both those things happen, and hope to help some of my customers along the way. Here are some of the articles I’ve found interesting in that area this week:

How to Tweet

I recently encouraged a family member to join Twitter; she gave it a try but couldn’t really figure out why I’d been so enthusiastic about it. That’s a feeling I remember having when I first joined Twitter something over a year ago – it took me a while to get used to a new way of communicating. So I started to tell her about some of the ways I’d eventually started using Twitter that resulted in me finding it such a useful tool.

For what they’re worth, here they are – if you’ve never tried Twitter or are new to it, I hope you’ll find them interesting.

0. Why tweet?

Like any good techie, I’m starting at 0, not 1 … and with something important: why Tweet? There must be a good reason, or so many of us wouldn’t be doing it so much. I think of Twitter as a global “over the partition” conversation. Years ago I worked in an office with partitions with a group of people who did roughly the same thing I did. Several times a day, someone would find something interesting on the web, fancy a coffee or just plain lose their rag with a malfunctioning piece of code … and say something about it. There’d be a brief conversation – sometimes informative, sometimes not – and then we’d all go back to what we were doing.

Nowadays? I can’t remember the last week I was in the same office two days in a row – except my home office of course. Often I’m in different cities or even countries on consecutive days. I work – and socialise – with an identifiable network of people, but they’re busy doing their own thing wherever they happen to be.

So I tweet them. Because by tweeting them I can reach them wherever they are; because they can decide whether to pay attention or not; and because there’s the potential for people I don’t know to overhear the conversation. I’ll explain what I mean by “overhearing” in points 2 and 3 further on.

So that’s the why of it, for me anyway, now here’s the how …

1. Say what you do

Twitter is blogging on a small scale – so fundamentally, just like blogging, it’s about letting people know what you’re doing – or what you’re reading, or what you’re thinking. So get started – whenever you pause for thought in your day, consider tweeting what’s on your mind. Someone, somewhere, might find it interesting.

2. Follow Twitterers in your network

You have to start somewhere, so start with who you know. Use the registration tools to find your e-mail contacts, or use the “Find People” search to look for people by name. More than likely, you were introduced to Twitter by a colleague, friend or contact so look them up and look at the people they follow. You’re likely to find people you know, or people who might be interesting to you.

3. Search

Most tweets on Twitter are public, so in theory you can listen to whatever anyone is saying … so how do you find the people you don’t know that are saying interesting things? One way is to use Twitter’s search facility to search for key words or phrases that describe what you’re interested in – for example, “Social Media”, “Environment”, “USA”, “Kylie”. That’s one way to see who’s tweeting about the things you’re interested in. Several companies are taking this approach, and will respond to a tweet containing their name either directly or by following you – they’re doing this because they’re exploring how they can use Twitter to interact with their customers and employees, and with the marketplace at large.

4. Use connection services

To be honest, Twitter search is a fairly blunt tool for making connections. More interesting are services such as “Mr. Tweet” (http://mrtweet.net) that analyse your Twitter connections and activity, and suggest people to follow. Alternatively, look at the replies your followers send to people you don’t know (i.e. messages containing @someones_name) and their re-tweets (i.e. a message they send starting RT @someones_name that indicates they’re forwarding a tweet from someone else). They’ll give you another link to people with whom you might share a common interest. Go look at their profiles and their tweets and perhaps start following them.

This should just about get you started. There’s a lot more advice out there, particularly if your interest in Twitter is concerned with it’s potential as a tool for personal and corporate promotion. I’ll leave that to others. But if you just want a few tips to get started, I hope this has been some help.

Happy tweeting,

Rick