An article in Rolling Stone worth reading….
The social media giant has swallowed up the free press, become an unstoppable private spying operation and undermined democracy. Is it too late to stop it?
Good article.
A couple of good excerpts:
It’s important to understand how tech companies make money if you want to understand why tech works the way that it does.
That’s it. Pretty much every company in tech is trying to do one of those three things, and you can understand why they make their choices by seeing how it connects to these three business models.
Today’s biggest tech companies follow a simple formula:
This model looks very different than how we think of traditional growth companies, which start off as small businesses and primarily grow through attracting customers who directly pay for goods or services. Companies that follow this new model can grow much larger, much more quickly, than older companies that had to rely on revenue growth from paying customers. But these new companies also have much lower accountability to the markets they’re entering because they’re serving their investors’ short-term interests ahead of their users’ or community’s long-term interests.
The pervasiveness of this kind of business plan can make competition almost impossible for companies without venture capital investment. Regular companies that grow based on earning money from customers can’t afford to lose that much money for that long a time. It’s not a level playing field, which often means that companies are stuck being either little indie efforts or giant monstrous behemoths, with very little in between. The end result looks a lot like the movie industry, where there are tiny indie arthouse films and big superhero blockbusters, and not very much else. [This is amplifying the winner-take-all dynamics of technology.]
And the biggest cost for these big new tech companies? Hiring coders. They pump the vast majority of their investment money into hiring and retaining the programmers who’ll build their new tech platforms. Precious little of these enormous piles of money is put into things that will serve a community or build equity for anyone other than the founders or investors in the company. There is no aspiration that making a hugely valuable company should also imply creating lots of jobs for lots of different kinds of people. [Note: I would add to this last point that the aspiration should be to distribute value more widely across the community, not necessarily create more jobs.]
But how?
DApps, or Distributed Applications, are the force multipliers for blockchain technologies, just like email, Amazon, eBay, Google, and social networks are the applications that have propelled the Internet. The race is on for the development of these Dapps to transform industries and the future of the Internet itself.
By Irving Wladawsky-Berger, WSJ, Mar 9, 2018
Blockchain has been in the news lately, but beyond knowing that it has something to do with payments and digital currencies, most people don’t know what blockchain is or why they should care. A major part of the reason is that we still don’t have the kind of easy-to-explain blockchain killer-apps that propelled the internet forward.
Blockchain has yet to cross the chasm from technology enthusiasts and visionaries to the wider marketplace that’s more interested in business value and applications. There’s considerable research on blockchain technologies, platforms and applications as well as market experimentation in a number of industries, but blockchain today is roughly where the internet was in the mid-late 1980s: full of promise but still confined to a niche audience.
In addition, outside of digital currencies, blockchain applications are primarily aimed at institutions. And, given that blockchain is all about the creation, exchange and management of valuable assets, its applications are significantly more complex to understand and explain than internet applications.
The management of information is quite different from the management of transactions. The latter, especially for transactions dealing with valuable or sensitive assets, requires deep contractual negotiations among companies and jurisdictional negotiations among governments. Moreover, since blockchain is inherently multi-institutional in nature, its applications involve close collaboration among companies, governments and other entities.
In my opinion, there will likely be two major kinds of blockchain killer-apps: those primarily aimed at reducing the friction and overheads in complex transaction involving multiple institutions; and those primarily aimed at strengthening the security and privacy of the internet through identity management and data sharing. Let me discuss each in turn.
Complex transactions among institutions. “Contracts, transactions, and the records of them are among the defining structures in our economic, legal, and political systems,” wrote Harvard professors Marco Iansiti and Karim Lakhani in a 2017 HBR article.
With blockchain, “every agreement, every process, every task, and every payment would have a digital record and signature that could be identified, validated, stored, and shared… Individuals, organizations, machines, and algorithms would freely transact and interact with one another with little friction.”
Blockchain holds the promise to transform the finance industry and other aspects of the digital economy by bringing one of the most important and oldest concepts, the ledger, to the internet age. Ledgers constitute a permanent record of all the economic transactions an institution handles, whether it’s a bank managing deposits, loans and payments; a brokerage house keeping track of stocks and bonds; or a government office recording the ownership and sale of land and houses.
Over the years, institutions have automated their original paper-based ledgers with sophisticated IT applications and data bases. But while most ledgers are now digital, their underlying structure has not changed. Each institution continues to own and manage its own ledger, synchronizing its records with those of other institutions as appropriate, – a cumbersome process that often takes days. While these legacy systems operate with a high degree of robustness, they’re rather inflexible and inefficient.
In August of 2016, the WEF published a very good report on how blockchain can help reshape the financial services industry. The report concluded that blockchain technologies have great potential to drive simplicity and efficiency through the establishment of new financial services infrastructure, processes and business models.
However, transforming the highly complex global financial ecosystem will take considerable investment and time. It requires the close collaboration of its various stakeholders, including existing financial institutions, fintech startups, merchants of all sizes, government regulators in just about every country, and huge numbers of individuals around the world. Getting them to work together and pull in the same direction is a major undertaking, given their diverging, competing interests. Overcoming these challenges will likely delay large-scale, multi-party blockchain implementations.
Supply chain applications will likely be among the earliest blockchain killer-apps, increasing the speed, security and accuracy of financial and commercial settlements; tracking the supply chain lifecycle of any component or product; and securely protecting all the transactions and data moving through the supply chain. The infrastructures and processes of supply chains are significantly less complex than those in financial services, healthcare, and other industries and there are already a number of experimental applications under way.
A recent WSJ CIO Journal article noted that blockchain seems poised to change how supply chains work. The article cites examples of projects with Walmart and British Airwayswhere blockchain is used to maintain the integrity of the data being shared across the various institutions participating in their respective ecosystems. Earlier this year IBM and Maersk announced a joint venture to streamline operations for the entire global shipping ecosystem. Their joint venture aims to apply blockchain technologies to the current stack of paperwork needed to process and track the shipping of goods. Maersk estimates that the costs to process and administer the required documentation can be as high as 20 percent the actual physical transportation costs.
Identity management and data sharing. The other major kind of blockchain killer-apps will likely deal with identity management and data security.
As we move from a world of physical interactions and paper documents, to a world primarily governed by digital data and transactions, our existing methods for protecting identities and data are proving inadequate. Internet threats have been growing. Large-scale fraud, data breaches, and identity thefts are becoming more common. Companies are finding that cyberattacks are costly to prevent and recover from. The transition to a digital economy requires radically different identity systems.
A major reason for the internet’s ability to keep growing and adapting to widely different applications is that it’s stuck to its basic data-transport mission. Consequently, there’s no one overall owner responsible for security, let alone identity management, over the internet. These important responsibilities are divided among several actors, making them significantly harder to achieve.
Blockchain technologies should help us enhance the security of digital transactions and data, by developing the required common services for secure communication, storage and data access, along with open source software implementations of these standard services, supported by all major blockchain platforms, such as Hyperledger and Ethereum.
Identity is the key that determines the particular transactions in which individuals, institutions, and the exploding number of IoT devices, can rightfully participate, as well as the data they’re entitled to access. But, our existing methods for managing digital identities are far from adequate.
To reach a higher level of privacy and security we need to establish a trusted data ecosystem, which requires the interoperability and sharing of data across the various institutions involved. The more data sources a trusted ecosystem has access to, the higher the probability of detecting fraud and identity theft. However, it’s not only highly unsafe, but also totally infeasible to gather all the needed attributes in a central data warehouse. Few institutions will let their critical data out of their premises.
MIT Connection Science, a research initiative led by MIT professor Sandy Pentland, has been developing a new identity framework that would enable the safe sharing of data across institutions. Instead of copying or moving the data across, the agreed upon queries are sent to the institution owning the data, executed behind the firewalls of the data owners, and only the encrypted results are shared. MIT Connection Science is implementing such an identity framework in its OPAL initiative, which makes extensive use of cryptographic and blockchain technologies. A number of pilots are underway around the world.
Irving Wladawsky-Berger worked at IBM for 37 years and has been a strategic advisor to Citigroup and to HBO. He is affiliated with MIT, NYU and Imperial College, and is a regular contributor to CIO Journal.
Dubai has vowed to become the ‘first blockchain-powered government in the world by 2020.’ PHOTO: RUSTAM AZMI/GETTY IMAGES
Some interesting recent articles on blockchain and crypto:
Latest blockchain applications could bring overdue change to critical, if unsexy, functions in shipping, real estate and…diamonds
We’re now awash in “crypto” hype—cryptocurrencies like bitcoin and fundraising efforts like initial coin offerings. For every venture capitalist or technical expert, there’s a half-dozen hype men and fly-by-night startups making the entire space look like a 21st-century version of the Amsterdam tulip mania.
All that noise has obscured the bona fide efforts involving the underlying technology, blockchain. Of all the manifestations of crypto, it’s the most seemingly mundane applications of blockchain that could lead to the biggest and most concrete changes in all of our lives.
These applications can’t be found on a coin exchange, and they aren’t going to turn anyone into an overnight billionaire. But they could bring much-needed change to some of the world’s most critical, if unsexy, industries. This means new ways of transferring real estate titles, managing cargo on shipping vessels, mapping the origins of conflict materials, guaranteeing the safety of the food we eat and more. Using blockchain, you could prove that a particular diamond on sale in a Milan boutique came from a particular mine in Russia.
What is blockchain? It’s essentially a secure database, or ledger, spread across multiple computers. Everybody has the same record of all transactions, so tampering with one instance of it is pointless. “Crypto” describes the cryptography that underlies it, which allows agents to securely interact—transfer assets, for example—while also guaranteeing that once a transaction has been made, the blockchain remains an immutable record of it.
The third reason is that hype I mentioned. The current excitement around cryptocurrency gives blockchain the visibility to attract developers and encourage adoption. Companies that have taken an “If it ain’t broke, don’t fix it” attitude toward back-office processes and logistics IT might be ready to spend big on updating those systems when they hear the buzzword “blockchain.”
In this way, blockchain resembles another buzzword, “the cloud.” While detractors argued that the cloud was just “someone else’s computer,” it gave many industries new business processes, new ways to charge for services, disruptive startups and new divisions within existing companies and an ecosystem of supporting technologies. Blockchain has the same potential.
Blockchain All the Things
Take logistics. Already, 1.1 million items sold or on sale at Walmart are on a blockchain—including chicken and almond milk—helping the company trace their journey from manufacturer to store shelf. Global shipping giant Maersk uses the same technology from IBM to track shipping containers, making it faster and easier to transfer them and get them through customs.
While these projects are still a fraction of the overall tracking that goes on at these giants, they are expanding rapidly both within the organizations and across their industries. Other companies using blockchain technology to track goods include Kroger, Nestlé, Tyson Foods and Unilever, with many more yet to be announced, says Bridget van Kralingen, senior vice president of platforms and blockchain at IBM.
Everledger, a company started in April 2014 with the intention of creating a blockchain-based registry of every certified diamond in the world, already has 2.2 million diamonds in its registry. It’s adding about 100,000 diamonds a month, says Leanne Kemp, chief executive and founder.
By recording 40 different measures of each stone, including “physically unclone-able features,” Everledger is able to trace the journey of a stone from when it’s pulled from the earth to the day it’s purchased by a consumer. Every participant in that chain, from the miner to the cutter to the retailer, maintains a node—with a complete copy of the database—in the Everledger blockchain network.
CartaSense is an eight-year-old Tel Aviv company that puts internet-connected sensors on freight pallets and uses analytics to determine when goods may be delayed or damaged. CartaSense customers, rather than physically handing off scanned and signed paper documents, use a blockchain database on which freight companies can record every stage of the journey of a package, pallet or shipping container. Kuehne + Nagel, one of the world’s largest freight companies, is one of CartaSense’s clients.
Replacing Regulations With Code
Blockchain is being implemented first within companies and centralized governments that can move quickly on new technologies.
Dubai, for example, has declared its intent to make itself the “first blockchain-powered government in the world by 2020.” That could streamline things in real estate, says Stephen McKeon, an associate professor of finance at the University of Oregon who studies blockchain. By moving the central record of all real-estate transactions onto a blockchain, Dubai could make it faster and easier to transfer property titles.
Because such “smart contracts” on a blockchain are code, they can contain rules about how they can be modified or transferred. In this way, blockchain could become a way to transfer the obligation of enforcement from bureaucrats to computers. For example, to prevent fraud, titles could be transferable only to certain accounts, or might transfer only after another condition, such as the transfer of funds in escrow, is met.
It’s too early to say whether blockchain, as both a technology and a movement, has the power to overcome issues that thwarted generations of software engineers. The most justifiable skepticism is that blockchain is incremental rather than revolutionary. In some cases, it isn’t much more than a marketing term imposed on systems that hardly differ from existing databases. (There’s a healthy debate about what blockchain even means, and even companies like CartaSense call their system a “blockchain-like technology.”)
But if it works, it has the potential to be a fundamental enabling technology, the way new standards for transmitting data across networks led to the internet. More concretely, it could someday underlie everything from how we vote to who we connect with online to what we buy.
Write to Christopher Mims at [email protected]
Appeared in the March 12, 2018, print edition as ‘Blockchain Has Power to Transform.’
Excerpt from a review of books in The New Yorker: “Are Liberals on the Wrong Side of History?”
The algorithms of human existence are not like the predictable, repeatable algorithms of a computer, or people would not have a history, and Donald Trump would not be President. In order to erase humanity as a special category—different from animals, on the one hand, and robots, on the other—Harari [author of Sapiens] points to the power of artificial intelligence, and the prospect that it will learn to do everything we can do, but better. Now, that might happen, but it has been predicted for a long time [there’s more to the human than we assume] and the arrival date keeps getting postponed.
The A.I. that Harari fears and admires doesn’t, on inspection, seem quite so smart. He mentions computer-generated haiku, as though they were on a par with those generated by Japanese poets. Even if such poems exist, they can seem plausible only because the computer is programmed to imitate stylistic tics that we have already been instructed to appreciate, something akin to the way the ocean can “create” a Brancusi—making smooth, oblong stones that our previous experience of art has helped us to see as beautiful—rather than to how artists make new styles, which involves breaking the algorithm, not following it.
The alarm bells keep ringing on the tech quasi-monopolies that rule the Internet. There are two main issues to address: one is the ownership and control over personal data – this data rightly belongs to consumers, not network servers – and two is the positive network effects that drive these cos. to dominance.
How we analyze these tech titans differs along these two issues. Amazon, Apple and Microsoft sell products and product markets are not easily protected from competition. They are middlemen between producers/suppliers and consumers. I expect we will discover new competitive models to deliver goods and services, which will eat into these cos.’ dominance. The promise of blockchain technology is exactly to eliminate the middleman.
Google and Facebook are different animals. Search is starting to appear to resemble a public good, like public libraries. With the positive externalities of network effects, it also resembles a natural monopoly – the more people use a search engine, the better is the information obtained, meaning the search engine becomes ever more valuable. We probably don’t want to destroy this value. To me, this suggests that Google’s search engine eventually will become a publicly regulated utility – because the politics will demand it. We already see this outside the U.S.
Facebook, the ultimate social network, is going through some ups and downs because of issues of how it collects and uses personal information. My impression is that a single social network for all socializing needs is probably not the ideal solution. If correct, competition will eat into FB, which will start to break up into different targeted functions, reducing its value as a one-stop-fits-all OSN.
We shall see.
March 4, 2018
Meet the new boss. Same as the old boss.
– The Who, “We won’t be fooled again”, 1971
Once seen as the saviors of America’s economy, Silicon Valley is turning into something more of an emerging axis of evil. “Brain-hacking” tech companies such as Apple, Google, Facebook, Microsoft and Amazon, as one prominent tech investor puts it, have become so intrusive as to alarm critics on both right and left.
Firms like Google, which once advertised themselves as committed to being not “evil,” are now increasingly seen as epitomizing Hades’ legions. The tech giants now constitute the world’s five largest companies in market capitalization. Rather than idealistic newcomers, they increasingly reflect the worst of American capitalism — squashing competitors, using indentured servants, attempting to fix wages, depressing incomes, creating ever more social anomie and alienation.
At the same time these firms are fostering what British academic David Lyon has called a “surveillance society” both here and abroad. Companies like Facebook and Google thrive by mining personal data, and their only way to grow, as Wired recently suggested, was, creepily, to “know you better.”
The techie vision of the future is one in which the middle class all but disappears, with those not sufficiently merged with machine intelligence relegated to rent-paying serfs living on “income maintenance.” Theirs is a world in where long-standing local affinities are supplanted by Facebook’s concept of digitally-created “meaningful communities.”
The progressive rebellion
Back during the Obama years, the tech oligarchy was widely admired throughout the progressive circles. Companies like Google gained massive access to the administration’s inner circles, with many top aides eventually entering a “revolving door” for jobs with firms like Google, Facebook, Uber, Lyft and Airbnb.
Although the vast majority of all political contributions from these firms, not surprisingly, go to the Democrats, many progressives — at least not those on their payroll — are expressing alarm about the oligarchs’ move to gain control of whole industries, such as education, finance, groceries, space, print media and entertainment. Left-leaning luminaries like Franklin Foer, former editor of the New Republic, rant against technology firms as a threat to basic liberties and coarsening culture.
Progressives are increasingly calling for ever growing tech monolith to be “broken up,” calling for new regulation to limit their size and scope. Many have embraced European proposals to restrain tech monopolies which now resemble “predatory capitalism” at its worse.
The right also rises
Traditionally, conservatives celebrated entrepreneurial success and opposed governmental intervention in the economy. Yet increasingly even libertarians, like Instapundit’s Glen Reynolds, have suggested that some form of anti-trust action may be necessary to curb oligarchic power. The National Review even recently suggested that these firms be treated as utilities, that is, regulated by government.
Conservatives are also concerned about pervasive political bias in the industry. The Bay Area, the heartland of the industry, has evolved as Facebook co-founder Peter Thiel notes, into a “one party state.” Ideological homogeneity discourages debate and dissent, both inside their companies.
More importantly, conservatives seek to curb their ability — increasingly evident as traditional media declines — to control content on the internet. As the techies expand their domain, America’s media, entertainment and cultural industries would seem destined to become ever less heterogenous in politics and cultural world-view.
A clear and present danger
Whether one sits on the progressive left or the political right, this growing hegemony presents a clear and present danger. It is increasingly clear that the oligarchs have forgotten that Americans are more than a collection of data-bases to be exploited. People, whatever their ideology, generally want to maintain a modicum of privacy, and choose their way of life.
The perfect world of the oligarchs can be seen in the Bay Area, where, despite the massive explosion in employment, even tech workers, due to high costs, do worse than their counterparts elsewhere. Meanwhile San Francisco, among the most unequal places in the country, has evolved into a walking advertisement for a post-modern dystopia, an ultra-expensive city filled with homeless people and streets filled with excrement and needles. It is also increasingly exporting people elsewhere, including many people making high salaries.
Of course, technology is critical to a brighter future, but need not be the province of a handful of companies or concentrated in one or two regions. The great progress in the 1980s and 1990s took place in a highly competitive, and dispersed, environment not one dominated by firms that control 80 or 90 percent of key markets. Not surprisingly, the rise of the oligarchs coincides with a general decline in business startups, including in tech.
We have traveled far from the heroic era of spunky start-ups nurtured in suburban garages. But a future of ever greater robotic dependence — a kind of high-tech feudalism — is not inevitable. Setting aside their many differences, conservatives and progressives need to agree on strategies to limit the oligarch’s stranglehold on our future.
Joel Kotkin is the R.C. Hobbs Presidential Fellow in Urban Futures at Chapman University in Orange and executive director of the Houston-based Center for Opportunity Urbanism (www.opportunityurbanism.org).
Google? Facebook? These two firms alone control roughly 2/3s of digital media advertising revenues.
That’s power. That’s knowledge.
But knowledge of what?
Mostly of how to program computers and deploy algorithms to sort through, organize, cluster, rank, and order vast quantities of data. In the case of Facebook, Zuckerberg obviously also understood something simple but important about how human beings might enjoy interacting online. That’s not nothing. Actually, it’s a lot. An enormous amount. But it’s not everything — or anything remotely close to what Silicon Valley’s greatest innovators think it is.
When it comes to human beings — what motivates them, how they interact socially, to what end they organize politically — figures like Page and Zuckerberg know very little. Almost nothing, in fact. And that ignorance has enormous consequences for us all.
A recent article from US News and World Report on the dominance of technology and the degeneration of political discourse. Zingales co-wrote an interesting book, Saving Capitalism from the Capitalists, that I previously posted about here.
Are the internet giants monopolies?
LUIGI ZINGALES PROVIDES a window onto news illiteracy or at least social media’s penchant for the provocative over the reasoned.
Zingales is an economist at the Booth School of Business at the University of Chicago, whose main floor walls are lined with a photographic Murderer’s Row of Nobel laureates (nine, actually) in economics. You can occasionally find a real, live Nobelist at the salad bar in the upscale cafeteria just off an airy lobby atrium where elite students from around the globe (our future tech moguls, Fortune 500 chiefs and perhaps even well-heeled dictators) can be found chatting with an unmistakable aura of privilege and intellectual superiority.
The Padua, Italy native has inspired a nasty kerfuffle by inviting former Trump administration adviser Steve Bannon to campus (date to be determined), prompting both accusations of his promoting a “Nazi” and a sit-in by protesters during one of his classes. The university, where (some joke) fun goes to die, has long been the most honorable bastion of free speech and won’t buckle, as President Robert Zimmer reiterated during a conversation with The Wall Street Journal.
But if the citizenry were less ideologically convulsed, it might pay attention to Zingales’ actual work, which includes questions about more troubling forces than a humbled former Donald Trump Svengali.
In sum, are Facebook and Google monopolies?
Zingales first broached the matter in a podcast he co-hosts with Kate Waldock of Georgetown University and now goes into greater detail both in a conversation with George Mason University’s Tyler Cowen found in Booth’s magazine and in a phone chat.
Zingales is troubled by their power, but Cowen really isn’t as he noted some obvious realities: Most people love them and the price is right. They have ascended because they’re doing a better job than media competitors. Their growing market share, especially of ad dollars, is a function of being very good during a period where our choice in media has never been greater.
Zingales demurred and contends, for starters, that we pay a greater price than imagined, most notably in the personal data we give up. Oddly, we may not place as great a value on that data as we might and do seem less and less concerned about privacy. We don’t really appreciate all the information we routinely dispense as we google and post on Facebook.
So, to that extent, data is the new oil and Facebook is our new Rockefeller, harkening to the days of Standard Oil’s monopoly. Cowen disagrees, noting that, in his mind, Facebook’s product is free and it doesn’t have a monopoly on his attention, as Rockefeller did on our gasoline.
Zingales countered that the control of data is worse and gives the giant platforms an increasing hold over other sectors, especially as artificial intelligence grows. It’s not quite a traditional monopoly but a dangerously unceasing leverage of influence.
In his very civil debate with Cowen, he said, “I’m not advocating regulation; I’m advocating a reallocation of data ownership. I don’t want to tax them; I want more competition. You want, as you said, a walled garden. In a walled garden, there are two factors at play. One benefits the consumer. The other creates a moat to block competitors from coming in and to build a bigger and bigger monopoly.”
“These companies discriminate on a commercial basis. If you are a competitor, you’re at the bottom of the list,” he added. “If I own the railways, I can’t charge you double the price because you’re my competitor, while my friends get it for free. That’s the law of the land in the U.S.: If you are a public utility with certain characteristics, you must provide service on equal terms to everybody.”
And, while he pointed to the effectiveness of European media and data regulation (and argued that prices have gone down and competition increased for products such as phones), he doesn’t call for immediate regulation but, at the minimum, a more explicit understanding of the giants’ power.
“It’s not a straightforward thing,” he says in a phone chat. “The solution is not saying there is no problem or jumping the gun. In my first line of attack, it’s saying I want to make the market more competitive by introducing rules to make it more competitive.“
Take a look at the increasing Facebook-Google stranglehold on digital advertising. Yes, there is greater access these days to information (including, he jests, people wasting time on academics’ blogs), but really good information has to be paid for. The decline in that lifeblood of a democracy is vivid, especially in local media markets.
“I am not trying to go back to good old days. They weren’t that good and they are not coming back. But saying there is no problem would be excessive. Facebook and Google are extremely good at transmitting information but not at creating information,” he says.
Good information is a public good, he contends, as he was reminded of when watching “The Post,” the Steven Spielberg-Meryl Streep-Tom Hanks movie on The Washington Post’s coverage of the Pentagon Papers.
He recalls how when The Post was concerned about The New York Times’ blockbuster initial coverage, “they go out and buy ten copies of The Times. We are not used to that anymore. Modern technology has made ease of reproduction easier,” and disrupted business models. These days, just find a free digital version of the story.
If the Justice Department’s antitrust division sought his counsel, he’d try to figure ways to increase competition, be stricter with Google in assuring search brings unbiased results from both a commercial and political point of view and try to somehow limit the size of the digital ad market it and Facebook control.
“Maybe put a strict limit that they can’t control more than x-percent in that market,” he says. Some of the very media concentration limits ditched by Trump’s Federal Communications Commission should probably be revived for the internet age, he suspects, with last week’s Robert Mueller indictments of Russian trolls only underscoring the influence of Facebook, especially (not to mention the growing inability of Americans to distinguish real from phony).
“I’m not against [Facebook and Google],” Zingales says. “I just worry about their power.”
And then, of course, there’s that guy, Bannon, and the very harsh public debate that’s included the depressingly liberal use of the word “Nazi.” It’s perhaps more concerning than the role of Facebook and Google.
“We don’t have a date yet. But what’s shocked me is that extremism of some positions. I am actually more worried about the future of the nation as a result,” he says.
Very interesting article by Joel Kotkin, who researches the economics and politics of cities. It portrays a future that resembles feudalism more than free market democratic capitalism. I’d optimistically venture there will eventually be a more humanist backlash against the future dominance of technology.
The unaffordable Bay Area, Google’s new neighborhood ‘built from the internet up,’ and China’s police state each offer glimpses of what the tech giants plan to sell the rest of us.
by Joel Kotkin
The tech oligarchs who already dominate our culture and commerce, manipulate our moods, and shape the behaviors of our children while accumulating capital at a rate unprecedented in at least a century want to fashion our urban future in a way that dramatically extends the reach of the surveillance state already evident in airports and on our phones.
…
The drive to redesign our cities, however, is not really the end of the agenda of those who Aldous Huxley described as the top of the “scientific caste system.” The oligarchy has also worked to make our homes, our personal space, “connected” to their monitoring and money machines. This may be a multibillion-dollar market soon, but many who have employed such devices at home—appliances that track our activities and speak to us like loyal servants—find them “creepy,” as they should, given that their daily activities are fed back to enrich the high-tech hive mind. Both the city and house the future may owe more to Brave New World than Better Homes and Gardens.
This is a vision of the urban future in which the tech companies’ own workers and whatever other people with skills the machines haven’t yet replaced are a new class of urban serfs living in small apartments, along with a much larger class of dependent persons living on “income maintenance” and housing or housing subsidies provided by the state. “Bees exist on Earth to pollinate flowers, and maybe humans are here to build the machines,” observes professor Andrew Hudson-Smith, from University College London’s Centre for Advanced Spatial Analysis. “The city will be one big joined-up urban machine, and humans’ role on Earth will be done.”
Below are excerpts from a fascinating series of articles by The Guardian (with links). The articles address many of the ways that Internet 2.0 network media models such as Google, Facebook, YouTube, Instagram, etc. are transforming, and in many cases undermining, the foundations of a democratic humanistic society. These issues motivate us at tuka to design solutions to the great question of life’s meaning.
Personally, I don’t believe this dystopia will come to pass because humans are quite resilient as a species and eventually our humanist qualities will dominate our biological urges and economic imperatives. We have free will and ultimately, we choose correctly.
Perhaps that is an overly optimistic opinion, but Internet (or Web) 3.0 technology is rewriting the script with applications that reassert human control over the data universe. We will build more humanistic social communities that employ technology, with the emphasis always on the human. We see this now with the growing refusal to surrender to Web 2.0 by tech insiders.
See excerpts and comments below.
“If politics is an expression of our human will, on individual and collective levels, then the attention economy is directly undermining the assumptions that democracy rests on.” If Apple, Facebook, Google, Twitter, Instagram, and Snapchat are gradually chipping away at our ability to control our own minds, could there come a point, I ask, at which democracy no longer functions?
February 2, 2018
There are 1.5 billion YouTube users in the world, which is more than the number of households that own televisions. What they watch is shaped by this algorithm, which skims and ranks billions of videos to identify 20 “up next” clips that are both relevant to a previous video and most likely, statistically speaking, to keep a person hooked on their screen.
Company insiders tell me the algorithm is the single most important engine of YouTube’s growth. In one of the few public explanations of how the formula works – an academic paper that sketches the algorithm’s deep neural networks, crunching a vast pool of data about videos and the people who watch them – YouTube engineers describe it as one of the “largest scale and most sophisticated industrial recommendation systems in existence”.
We see here the power of AI data algorithms to filter content. The Google response has been to “expand the army of human moderators.” That’s a necessary method of reasserting human judgment over the network.
The primary focus of the article then turns to politics and the electoral influences of disinformation:
Much has been written about Facebook and Twitter’s impact on politics, but in recent months academics have speculated that YouTube’s algorithms may have been instrumental in fuelling disinformation during the 2016 presidential election. “YouTube is the most overlooked story of 2016,” Zeynep Tufekci, a widely respected sociologist and technology critic, tweeted back in October. “Its search and recommender algorithms are misinformation engines.”
Apparently, the sensationalism surrounding the Trump campaign caused YT’s AI algorithms to push more video feeds favorable to Trump and damaging to Hillary Clinton. One doesn’t need to be a partisan to recognize this was probably true for this particular media channel and its business model that values more views more than anything else.
However, this reality can also be distorted to present a particular conspiracy narrative of its own:
Trump won the electoral college as a result of 80,000 votes spread across three swing states. There were more than 150 million YouTube users in the US. The videos contained in Chaslot’s database of YouTube-recommended election videos were watched, in total, more than 3bn times before the vote in November 2016.
This, unfortunately, is cherry-picking statistical inferences concerning the margin of voting support. What was significant in determining the 2016 election outcome was not 80,000 votes across three states, but a run of popular vote wins in 2,623 of 3,112 counties across the U.S. This 85% share could not be an accident, nor could it be due to the single influence of disinformation, Russian or otherwise. The true difference in the election was not revealed by the popular vote total or the Electoral College vote, but by the geographical distribution of support. One can argue about which is more critical to democratic governance, but this post is about electronic media content, not political analysis.
The next article further addresses how technology is influencing our individual behaviors.
October 6, 2017
Justin Rosenstein had tweaked his laptop’s operating system to block Reddit, banned himself from Snapchat, which he compares to heroin, and imposed limits on his use of Facebook. But even that wasn’t enough. In August, the 34-year-old tech executive took a more radical step to restrict his use of social media and other addictive technologies.
A decade after he stayed up all night coding a prototype of what was then called an “awesome” button, Rosenstein belongs to a small but growing band of Silicon Valley heretics who complain about the rise of the so-called “attention economy”: an internet shaped around the demands of an advertising economy.
The extent of this addiction is cited by research that shows people touch, swipe or tap their phone 2,617 times a day!
There is growing concern that as well as addicting users, technology is contributing toward so-called “continuous partial attention”, severely limiting people’s ability to focus, and possibly lowering IQ. One recent study showed that the mere presence of smartphones damages cognitive capacity – even when the device is turned off. “Everyone is distracted,” Rosenstein says. “All of the time.”
“The technologies we use have turned into compulsions, if not full-fledged addictions,” Eyal writes. “It’s the impulse to check a message notification. It’s the pull to visit YouTube, Facebook, or Twitter for just a few minutes, only to find yourself still tapping and scrolling an hour later.” None of this is an accident, he writes. It is all “just as their designers intended”.
Tristan Harris, a former Google employee turned vocal critic of the tech industry points out that… “All of us are jacked into this system. All of our minds can be hijacked. Our choices are not as free as we think they are.”
“I don’t know a more urgent problem than this,” Harris says. “It’s changing our democracy, and it’s changing our ability to have the conversations and relationships that we want with each other.”
…
Harris believes that tech companies never deliberately set out to make their products addictive. They were responding to the incentives of an advertising economy, experimenting with techniques that might capture people’s attention, even stumbling across highly effective design by accident.
“Smartphones are useful tools,” says Loren Brichter, a product designer. “But they’re addictive. Pull-to-refresh is addictive. Twitter is addictive. These are not good things. When I was working on them, it was not something I was mature enough to think about.”
The two inventors listed on Apple’s patent for “managing notification connections and displaying icon badges” are Justin Santamaria and Chris Marcellino. A few years ago Marcellino, 33, left the Bay Area and is now in the final stages of retraining to be a neurosurgeon. He stresses he is no expert on addiction but says he has picked up enough in his medical training to know that technologies can affect the same neurological pathways as gambling and drug use. “These are the same circuits that make people seek out food, comfort, heat, sex,” he says.
“The people who run Facebook and Google are good people, whose well-intentioned strategies have led to horrific unintended consequences,” he says. “The problem is that there is nothing the companies can do to address the harm unless they abandon their current advertising models.
But how can Google and Facebook be forced to abandon the business models that have transformed them into two of the most profitable companies on the planet?
This is exactly the problem – they really can’t. Newer technology, such as distributed social networks tracked by blockchain technology, must be deployed to disrupt the dysfunctional existing technology. New business models will be designed to support this disruption. Human behavioral instincts are crucial to successful new designs that make us more human, rather than less.
James Williams does not believe talk of dystopia is far-fetched. …He says his epiphany came a few years ago when he noticed he was surrounded by technology that was inhibiting him from concentrating on the things he wanted to focus on. “It was that kind of individual, existential realization: what’s going on?” he says. “Isn’t technology supposed to be doing the complete opposite of this?”
The question we ask at tuka is: “What do people really want from technology and social interaction? Distraction or meaning? And how do they find meaning?” Our answer is self-expression through creativity, sharing it, and connecting with communities.
Williams and Harris left Google around the same time and co-founded an advocacy group, Time Well Spent, that seeks to build public momentum for a change in the way big tech companies think about design.
“Eighty-seven percent of people wake up and go to sleep with their smartphones,” he says. The entire world now has a new prism through which to understand politics, and Williams worries the consequences are profound.
The same forces that led tech firms to hook users with design tricks, he says, also encourage those companies to depict the world in a way that makes for compulsive, irresistible viewing. “The attention economy incentivizes the design of technologies that grab our attention,” he says. “In so doing, it privileges our impulses over our intentions.”
That means privileging what is sensational over what is nuanced, appealing to emotion, anger, and outrage. The news media is increasingly working in service to tech companies, Williams adds, and must play by the rules of the attention economy to “sensationalize, bait and entertain in order to survive”.
In the wake of Donald Trump’s stunning electoral victory, many were quick to question the role of so-called “fake news” on Facebook, Russian-created Twitter bots or the data-centric targeting efforts that companies such as Cambridge Analytica used to sway voters. But Williams sees those factors as symptoms of a deeper problem.
It is not just shady or bad actors who were exploiting the internet to change public opinion. The attention economy itself is set up to promote a phenomenon like Trump, who is masterly at grabbing and retaining the attention of supporters and critics alike, often by exploiting or creating outrage.
Orwellian-style coercion is less of a threat to democracy than the more subtle power of psychological manipulation, and “man’s almost infinite appetite for distractions”.
“The dynamics of the attention economy are structurally set up to undermine the human will,” Williams says. “If politics is an expression of our human will, on individual and collective levels, then the attention economy is directly undermining the assumptions that democracy rests on.” If Apple, Facebook, Google, Twitter, Instagram, and Snapchat are gradually chipping away at our ability to control our own minds, could there come a point, I ask, at which democracy no longer functions?
Our politics will survive and democracy is only one form of governance. The bigger question is how does human civilization survive if our behavior becomes self-destructive and meaningless?
www.ocregister.com/2018/03/03/how-silicon-valley-went-from-dont-be-evil-to-doing-evil/