As I mentioned the other day, George Gilder does not accept the vision of a totalitarian future. Here is Gilder in the WSJ.
With the cryptographic revolution, he says, “we’re now in charge of our own information. For the first time in history, really, you don’t have to prove who you are, or what you are, before a transaction.” A blockchain allows users “to be anonymous if they wish, while also letting them keep a time-stamped record of all their previous transactions. It allows us to establish unimpeachable facts on the internet.”
In his new book, Life After Google, Gilder argues that the concentration of power at Google or Facebook is a temporary phenomenon. He believes that power will diffuse once again.
Where I a skeptical of his view is that I believe that the power that the top companies have comes from their skills at strategy and managing software development. Those skills are highly concentrated, and I do not see that changing.
Western governments have again joined the totalitarian governments in demanding backdoor access to encrypted content. I have no doubt it will eventually become illegal almost everywhere to use encryption that lacks a back door.
Also, blockchains are not anonymous – if they were, they would have severely limited utility – but rather pseudonymous. And useful pseudonymity implies the existence of an identity map somewhere. The blockchain lasts forever, by design; and in most cases the identity map will last forever too.
Finally, blockchains are not fundamentally unimpeachable. They are merely unimpeachable to those who do not have massive resources. Big Brother may very well be able to change the “unimpeachable” past – and no-one would be able to prove it.
But the world’s most successful operating system (Linux) is not controlled by Apple or Google. I agree that expertise in managing software teams is very important, but successful open source projects show that one skillful person can create long-lasting, highly decentralized software.
But maybe corporate, centralized software will win in the long run; maybe Linux will die after Linus retires or dies. I don’t think so, but I’m biased (I used to be the lead developer for an open source project).
A lot of this is going to depend on whether citizens buy into the current narrative that average level skills are “no longer needed” in future workplaces. Hopefully that reasoning will be rejected! It’s precisely the average skill levels (which of course are statistically prevalent) where deep learning AI could make it feasible for individuals to apply a wide range of knowledge in any community.
Anonymity of transactions comes from cryptography, not blockchain.
The shrewd folks at google have discovered that knowledge is dispersed, they have a theoretical limit to centralization.
Truly hope springs eternal. Similar ideas were expressed during the heyday of blogging 10-15 years ago – that the decentralized nature of the internet will route around the established centralized providers of information, that the people would finally stop depending on them for their worldviews and learn for themselves. With the benefit of hindsight, it is obvious how naive this was, and how quickly the freewheeling decentralized blogosphere was crowded out, coopted, or suppressed in favor of centralized providers or networks of same (e.g. Twitter reportedly functions as a sort of Slack channel for journalists).
Facebook is said to be some great and impressive software system, and I’m not qualified to judge. But Twitter seems like something almost any small startup can replicate cheaply and easily, and indeed some have. But Twitter is a superstar firm with a crazy high valuation over $25 Billion. So, at least insofar as social media is concerned, Twitter makes a good case for the “Centralizing Network / Agglomerating Effects > Special Software Skills” argument. Everyone is on Twitter because everyone else is also on Twitter.
My own belief is that any Twitter-like application is likely to be bad for us socially, intellectually, and spiritually, and that Twitter in particular is an awfully biased and dishonest company obnoxiously collecting up as much personal information as it can and abusing their dominant position to sneakily silence non-progressives and their ideas. Furthermore, the program itself is not even that good, it’s an awkward and clunky interface that is annoying to use and which makes really following chronological conversations difficult. Tweet-space seems by and large to be an utter intellectual wasteland except for a few rare oases of stimulating content.
And yet, the evolutionary change regarding which internet platforms are now the dominant conduits for conveying interesting information and having intelligent conversations about it has made it so that even I – a canonical Twitter hater – really does not feel free to block it out. Cowen had a link to an essay by Emily Wilson broken up into over a dozen tweets regarding the challenge of translating the Odyssey. It was a great explanation, but absolutely had no business being on Twitter as anything but a link to an old-school blog post. And yet, here we are, and everything seems to be moving in direction of this inferior equilibrium.
The question for the other star ‘magic intangibles’ companies is then to what degree they are Twitter-type or Software-development-management-genius types.
I agree with your second paragraph, and you’re quite right in the first paragraph that any small startup can make a Twitter-like website/application easily – in fact, simple websites/applications of this nature are staple code samples for server push notification frameworks – but you vastly underestimate the technical complexity of Twitter itself. The technical problem with Twitter is that Twitter has to work at the scale of Twitter. They handle something like 10,000 new tweets per second on average (and very likely an order of magnitude more views per second, serving tons of pictures and videos too), each of which has to be scanned and processed in a hundred different ways by their ad algorithms, usage policy algorithms, search etc. They have to be stable under spiky loads: I shudder to imagine what their 99-th-percentile tweets-per-second number is, never mind the 99.9-th. They have to store all of it forever and make it instantly searchable. That does call for expensive infrastructure and custom software and ingenious solutions. Just spinning up a few Kubernetes clusters in the cloud running something a small startup can write in three months won’t cut it.
I wonder if somebody couldn’t make e.g. a full-fledged blogging platform on top of Twitter, with comments and the whole works, using it as the underlying storage and notification mechanism. With the new 240-character limit, one can afford to waste a dozen characters per tweet for control information. There are already websites like Twitlonger, but that’s just a crutch.
It would hard to state we live a totalitarian state today and yet individual movements are potentially easier to monitor than 1950 Soviet Union. Probably the key point is potentially.
1) For whatever reason most tech markets settle on a few key players. (Probably because skills and learnings are easier with less systems to navigate.) So even if Facebook, Google, Microsoft and Apple diminish they will replaced by someone similar.
2) Large companies thrive this system. As cash is used less crime is diminishing.
3) For all the concern of the US, other governments are worse and China government is taking more steps to control netizens.
4) AI and cameras are gaining. What happens with driverless cars in 50 years? Will people learn to drive?
5) For anybody with a cell phone, they are potentially monitored any movement they make.
“For the first time in history, really, you don’t have to prove who you are, or what you are, before a transaction.”
I’m thinking of something green and rectangular that rhymes with “lash.” Any guesses?
“while also letting them keep a time-stamped record of all their previous transactions.”
1) Different sentence, his claim stood alone.
2) Seems of marginal importance, why would I need to verify I made a purchase in that way?
Transactions are recorded only upon your voluntary contract.
Paper cash works that way, it is recorded when exiting the bank and only recorded again when it reenters.
With cryptography we can exactly duplicate that anonymous function, we can make pure digital bearer notes, get them from the Fed, pass them among you and any other person having the cash card, no one need t5o notify the Fed until one party wants to put the money on deposit.
Any anonymous money function can be duplicated digitally. The problem is our vote, every two years we all agree with the politicians; we do not want anonymous exchanges, you and I vote that restriction on ourselves.
No, we do not vote that restriction on ourselves.
Other people, more numerous, vote that restriction on us.
There is no such thing as collective guilt.
he has not been relevant for 20 years. I think he wants to keep to that way He made this exact same prediction 2 decades ago regarding telecommunications and was wrong.
“…the power that the top companies have comes from their skills at strategy and managing software development.”
Wasn’t Microsoft also good at this at one time? It’s still a big and profitable company, but there is much less angst about its power than 20 years ago.
I might start worrying if government tries to limit competition to these companies, otherwise, competition.
You are right to be skeptical of Gilder’s claim. Not only are Facebook, Google, etc., likely to retain their dominance (the upstarts are pathetic), but they have the advantage of belonging to a broader “conspiracy”: the academic-media-entertainment-information complex. Needless to say, it is leftist to its core.
You’re forgetting the economic angle. How the hell are for-profit tech monopolies leftist to their core?
” the power that the top companies have comes from their skills at strategy and managing software development. Those skills are highly concentrated, and I do not see that changing.”
— I flatly don’t believe it as stated above. A key thing most successful leftists believe, which I now also believe, is that a lot of big success is luck. Luck in timing, in choosing the technology which turns out, in the market, to be most successful. There are gains to consumers when an info tech provider becomes a de facto monopoly. Sort of like driving on the right side of the road, for a whole country (or the left side, for UK or Japan or …).
The company with the most successful skill at strategy & sw dev is Apple, and they are most likely to be the first one replaced (among Google, Facebook, Amazon, & Microsoft; I don’t believe in Twitter, tho). Apple will fade, in less than 2 decades (forever in tech) because they are hardware, and hardware doesn’t quite have the same network monopoly dominance for consumer devices over time. iPhoneX capability will soon be a commodity, like PCs are today.
Freedom? or Security? Most people want both but, if they must choose, most of the choosers will choose more Security. Risk aversion. Big Tech, regulated by Big Gov’t, with “the people” in charge of Big Gov’t (that’s the lie).
Facebook should be nationalized, with Instagram spun back out, and the ad algorithms clearly known, and known to be “fair”. Google should be broken up into at least 3: Search; YouTube (with its own search); Maps & eMail & everything else.
The gov’t should be trying to use Linux more, and other Open Source SW, which is file & app functionality compatible with MS. “Look & Feel” patents should be reduced to 5 years.
This won’t happen — probably. More likely is that the top tech execs, who know enough to know they were hugely lucky but now have to decide what to do with their lucky power, will support Big Gov’t against the “wrong kind” of Freedom.
I have a couple issues with this, the first of which is that I think there’s a world of difference in difficulty between inventing Facebook and maintaining it. While operating something at that scale is quite complex, the companies who have challenged FB (I’m thinking Snap, Instagram, and Whatsapp) are not really engineering/strategy stories per se. FB and Google now have the luxury of being able to sit back and see what’s working, and either acquire or copy it.
Second, many of these star companies also go out of their way to divulge as little detail as possible in their financials. My null hypothesis would thus be not that they are better at managing s/w development per se, but rather that they are simply able to spend a lot more than anybody else on the same thing. They’re able to do thins because they dammed up a river of cash early in the evolution of the market, and the public markets are more interested in growth than margin–though lately FB might be finding its limit there.
Last, I think that it is problematic to compare, say, Facebook’s engineering of its flagship product, to how a company applies IT to optimizing its business operations. Businesses do much more complex things than consumers do, and demand much more complex products, and software engineering is only as good as the requirements definitions the process begins with. When the end product isn’t software, “good enough” at technology may be good enough to stay competitive.