The logic of digital economy brings huge rewards to winners and impoverishes everyone else.
1. Once in a while new technology comes around and turns the world upside down. In a broader sense the Internet and digital communication are such technology. It has been compared to the Gutenbergian revolution of the 15th century that laid the ground for the Reformation, Renaissance and Humanism of the subsequent three centuries. None of us can know whether the Internet will have the same or even bigger impact on the world, nonetheless the present impact is substantial. We are touching the fringes of truly artificial, independent intelligence, which is getting more sophisticated month by month. Or so it seems. We are getting closer to the world envisioned by science fiction writers, in which robots take over substantial parts of the economy.
With technological breakthroughs, jobs get lost and people protest. In 1779, Ned Ludd smashed two stocking frames and gave name to the movement of machine destroyers. Since then the machines have occasioned existential worries in philosophy and literature. They have also engendered great hopes and inspired bursts of creativity. The Internet is but the latest manifestation of all the trends, yet since the digital age translates everything into real time, the worries and hopes are on steroids.
Scholars like Clay Shirky of New York University and Harvard look at digital age more or less optimistically. Shirky published two important books on the technology, Here Comes Everybody and Cognitive Surplus. The former deals with radical changes the Internet brought to ways we organize ourselves in corporate settings and beyond. The latter welcomes the Internet as an enabler of creativity that for ages lay dormant. With changes in society after World War II, especially the spread of free time among the middle classes, people were wondering what to do with all the free time and their eyes lay on television, then fresh out of diapers. Television filled a bulk of people’s time till the advent of the Internet. Unlike the Internet, the television was a passive, one-way flow of information and entertainment. It was the mass spread of digital communication that changed the equation. Suddenly people were no longer consumers only, but also creators of content. Shirky acknowledges that much of the content, from lolcats to memes, is not worth a lot. But the free time not devoted to television— cognitive surplus—has also produced the Wikipedia, the Ushahidi and the open source software. Shirky’s basically upbeat outlook sees in cyberspace a land of creative opportunity.
2. Enter Jaron Lanier. Computer scientist by trade, he is one of the fathers of virtual reality. He founded several start-ups that were eventually bought by large corporations. To this day he consults and works for companies like Microsoft and Google. He spearheaded the creation and perfection of electronic avatars of all kinds of creatures. Recently he worked on the use of digital technology in medical research. He is also an amateur musician, collector of dozens of ancient music instruments, which he plays passionately, sometimes for his mesmerized audiences before lectures and speeches.
Just a quick glance at Lanier’s oversized presence, framed by a huge long blanket of dreadlocked hair, in any of the many videos that feature him from TED talks to public television interviews, betrays a guru personality. Or, as he himself mockingly acknowledges, he used to cultivate a guru persona. He taught himself to talk in a guru way when, as he says, he was young and stupid. As an acquaintance of Timothy Leary (Lanier swears he himself never took drugs), who once told him it was important to surround himself with gorgeous young people and flatter them, Lanier resolved to do the exact opposite: to never fool them, to tell them the truth even when—especially when—that truth was unpleasant. His two books that he published in the last four years, You Are Not a Gadget and Who Owns the Future, are a testimony that he stayed faithful to his resolution.
There are very few people in Silicon Valley with such insight and as captivating and intelligent as Lanier. Not only does he know it all from within, he has been there at all the crucial junctures, cultural and technological, over the last thirty years. Yet reading his works can be as frustrating as watching some of his talks. His mind works in unexpected ways and is not always given to discipline and order. Some of his talks and interviews are lucid and to the point, like one he gave to the Toronto Public Television, other, as his book talk at Harvard Bookstore in Cambridge, are quirky and full of inside jokes. Periodically he moves his hand up to the hair and throws it back from his shoulders, and it looks so heavy that one fears that any minute it is going break his neck. On occasion he giggles girlishly in a higher pitch; a strange contrast with his XXL-size. He wanders around themes and digresses from digressions. One can be forgiven for imagining that he composes his books the same way he would compose a contemporary musical piece had he decided to do so.
Lanier is a fan of web 1.0 and a tough critic of web 2.0, which is to say he felt that the 1990s had been full of wild promises and unruly experimentation unbound by structures, promises that were never fulfilled precisely due the structures we have weaved into the technology as the technology moved up one generation. In the Gadget, Lanier discusses how we fashioned the web in an unfortunate way to the point that it now fashions us.
As an early example he thinks of muzak, the awful elevator music that however—to him at least—is somehow an expression of the limits. Once we have invented electronic musical instruments, we have started to adjust to what the instruments can and cannot do in composing music. The phenomenon has, according to Lanier, hit the entire pop music industry since the 1990s.
And a new thing, even more deadly, occurred: due to widespread copying and stealing, it is nearly impossible to make a living as a pop or rock musician these days, unless you already are a star. There are very few exceptions to the rule. In order to make money you need to tour the country, which more or less excludes all those with families and children. One side effect that Lanier detects is that since the grunge of the early nineties (Nirvana, Pearl Jam), we have had no distinct musical sound and style characterizing decades. In the 50s there was rock and roll, the 60s are times of the Beatles and Rolling Stones, the 70s brought the disco and the 80s birthed the new wave and electronic music. After Nirvana there is only a mix of everything but nothing really distinct, characteristic and new. Lanier apparently believes that the music evolution, or what he sees in it, characterizes all creativity on the web. Nothing is really new and striking. People limit themselves to dubbing, recycling, cutting and pasting, mixing and remixing.
Another telling instance to Lanier is Facebook. He does not reject it outright but sees in it a manifestation of regimented expression (not his term). In order to create an identity and fashion oneself on Facebook one must conform to the ways the social network is structured. One must write in certain spaces, must have friends, must like. The choices one is forced to exercise preclude other options. Over time by habit people begin thinking and behaving in certain technologically predetermined ways.
3. In a god-forsaken area in the Republika Srpska region of Bosnia and Herzegovina there is a billboard carrying a proud Breitling luxury watch photo right in front of junkyard. In Dortmund I have once seen a marketing display of super-expensive edition of Dunhill cigarettes in front of the railway station surrounded by stench of urine and homeless drunks. Billboard images of western products around slums in the poverty stricken areas are a common occurrence.
In his second book, Who Owns the Future, Lanier occasionally invokes similar imagery. Whilst the Gadget is chiefly concerned with promoting the humanity before the information and tech- nology—Lanier emphasizes that although it is possible to conceptualize the technology as existing independently of humans (take the fact that most words every single day are not read by people but by computer algorithmic programs, i.e. machines), it is not advisable—in the Future the author is concerned with the impact of digital technology on the entire economy.
To him the dramatic changes in the music industry and journalism due to stealing of content and “free” digital news are only a preview of things to come. More and more jobs will be lost to digitization. Already it is extremely difficult in this age of smart-phone cameras to make a living as a photographer. Soon enough driverless cars will all but eradicate the profession of drivers. Educa tion and professorial tenure might be next. Why pay indecent tuition when soon Harvard and MIT lectures might be online? 3-D printing is still rudimentary but who can guarantee that in a century we shall not be able to purchase online a software program of a new car and then print it on our 3-D printer in the garage? At its height Kodak employed 140 thousand people, writes Lanier. Instagram, when it was sold to Facebook in 2012 for a billion US dollars, employed thirteen people. One can hardly evoke a more vivid picture of the slimming down of the middle class than this.
4. Facebook, Google, Amazon and several dozen other companies organized around giant computers-servers in financial services, insurance and a handful of other industries tend to monopolize the market. The precursor to the development was Wal-Mart, which perfected the drive towards extreme efficiency. To some extent innovators always did it. Still Henry Ford tried to price his cars so that his employees at assembly line could afford them. Many Wal-Mart employees on Wal-Mart salaries cannot afford bigger-scale shopping in their department store. The logic of digital economy rewards winners and impoverishes everyone else, believes Lanier. He gives the supercomputers a Homeric name: siren servers. They function as mythical sirens, luring us with cheap or free services.
“We have free music, but soon enough barely anyone will be able to make money as a musician,” warns Lanier in one of his lectures. The same will soon apply to journalists, photographers, drivers and later on perhaps to teachers and professors. A look at Google and others’ business model is sobering. These companies give us free or cheap services and products in exchange for our allowing them to snoop on us. In the meantime they work to perfect cyber profiles of each of us according to our shopping, travel and life habits and then work the information into algorithms for offering information, services and goods. Sometimes Lanier lumps the government among the bunch but that is quite confusing, as the government promises us safety and security in exchange for electronic surveillance. That also is a proposition damaging to freedom and privacy, but governments are no desirable sirens to most people.
Lanier is no conspiracy nut. He knows and likes most of the originators and purveyors of the trend. For some he even works. “We have stumbled into the problem innocently, even happily,” says Lanier in an interview. There is no sinister design on the part of huge corporations to consign large parts of humanity to destitution, nor are there post-Marxist allusions to exploitation.
Siren serves can operate this efficiently and on the cheap due to one important twist of digital age: dishonest accounting. They create market value out of information they collect for free. Every time you agree to be followed while purchasing something, which nowadays is pretty much every time, you create value for those who snoop on you. Or, take the automated translating services. They are a good illustration that artificial intelligence is but a sum of human work and intelligence on many facets. All the translations that are used to improve the machine translations had to be translated by people. But they are not getting paid for their work that will create value for the companies who own the machines. Or yet another example—whatever you do on Facebook will later make the owners of the social network richer. And of course, whatever you do on Facebook you do in your free time and for free. Yes, you get free candy: chats with friends all over the world, all kinds of information and fights with your enemies. In the future you will lose your job to a machine owned by sons of Mark Zuckerberg.
Lanier is excellent at pointing out the flaw in the system, albeit in an exaggerated way (with all of the new technological breakthroughs jobs were lost and other were created), but less convincing in proposing corrections. As one way of rectifying the deficiencies he suggests that we institute micropayments for the kind of value we create for siren servers. It is difficult to imagine this solution in practice without disruption to digital economy.
One thing is clear: the naive idealists, offspring of the hippies of the 60s who to this day still maintain that information is and should be free, are dead wrong. Yet the genie is long out of the bottle and it would be a tall order to bottle it back.
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