Facebook thinks it’s a state. US Congress disagrees

This morning’s Observer column:

Now that Wimbledon is over, if you’re looking for something interesting to watch, can I suggest heading over to the video of last week’s interrogation by the US Senate committee on banking, housing and urban affairs of Facebook’s David Marcus? Given the astonishing incompetence of the Senate’s inquisition of Marcus’s boss, Mark Zuckerberg, some time ago, my hopes for last week’s hearing were not high. How wrong can you be?

But first a bit of background might be helpful. Facebook, currently the tech world’s most toxic company, has decided to get into the currency business. It proposes to launch a new global cryptocurrency called Libra. Marcus is the guy leading this project. He formerly worked at PayPal and then moved to Facebook, where he ran the company’s Messenger service.

At first sight, Marcus appears to be a Smooth Man from central casting. At second sight, he evokes the “uncanny valley”, defined by Wikipedia as “a hypothesised relationship between the degree of an object’s resemblance to a human being and the emotional response to such an object”. In that respect, he is not unlike his boss…

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Finally, a use for a Boris Johnson

Here’s a thought. Well, two thoughts.

  1. If Boris Johnson does indeed become Prime Minister then his photograph will be permanently on the front page of newspapers. This will be depressing for those of us who cannot stand the sight of the creep.

  2. On the other hand, the no-deal Brexit after which he lusts will result in — among many other things — a national shortage of toilet paper. Resourceful citizens will — like Leopold Bloom in Ulysses — cut up these newspapers into neat squares and hang them on hooks near their toilet bowls. Thus will the citizenry finally discover a use for their new Prime Minister.

Networked totalitarianism, courtesy of Western tech companies

Nice investigation by The Intercept:

AN AMERICAN ORGANIZATION founded by tech giants Google and IBM is working with a company that is helping China’s authoritarian government conduct mass surveillance against its citizens, The Intercept can reveal.

The OpenPower Foundation — a nonprofit led by Google and IBM executives with the aim of trying to “drive innovation” — has set up a collaboration between IBM, Chinese company Semptian, and U.S. chip manufacturer Xilinx. Together, they have worked to advance a breed of microprocessors that enable computers to analyze vast amounts of data more efficiently.

Shenzhen-based Semptian is using the devices to enhance the capabilities of internet surveillance and censorship technology it provides to human rights-abusing security agencies in China, according to sources and documents. A company employee said that its technology is being used to covertly monitor the internet activity of 200 million people…

Usual story. When it comes to it, there is no technology that Western tech companies won’t sell to the Chinese.

Why traditional political parties are in trouble

Perceptive NYT article on the stress fractures now materialising in the two big political parties.

WASHINGTON — On the night that he conceded defeat in 1992 after the most successful independent presidential campaign of the last century, Ross Perot made it clear that he was not done shaking up the established order. “Believe me,” he declared, “the system needs some shocks.”

So perhaps it was only fitting that on the same week that Mr. Perot died nearly 27 years later, both of the two major political parties were being rattled by the aftershocks of the earthquake that his campaign represented. President Trump was busy quarreling with former Speaker Paul D. Ryan while the current speaker, Nancy Pelosi, was bickering with first-year House Democrats.

In both cases, those who represented the institutional order, Mr. Ryan and Ms. Pelosi, found themselves at odds with rabble-rousers within their own parties agitating for change from outside the traditional system through the power of social media. This was not a week that showcased the competition between the parties but within them. The stress fractures that Mr. Perot identified a generation ago are tearing at the foundations of the Republican and Democratic Parties.

The same process is evident in the UK.

Fines don’t work. To control tech companies we have to hit them where it really hurts

Today’s Observer comment piece

If you want a measure of the problem society will have in controlling the tech giants, then ponder this: as it has become clear that the US Federal Trade Commission is about to impose a fine of $5bn (£4bn) on Facebook for violating a decree governing privacy breaches, the company’s share price went up!

This is a landmark moment. It’s the biggest ever fine imposed by the FTC, the body set up to police American capitalism. And $5bn is a lot of money in anybody’s language. Anybody’s but Facebook’s. It represents just a month of revenues and the stock market knew it. Facebook’s capitalisation went up $6bn with the news. This was a fine that actually increased Mark Zuckerberg’s personal wealth…

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Data can be as toxic as fossil fuel reserves

This morning’s Observer column:

”Data is the new oil” is a tired metaphor designed to capture the fact that, just as the old economy ran on oil, so the new digital economy runs on data. Just as plentiful reserves of underground oil were good for oil companies, so the possession of masses of data would likewise be a great asset for tech companies lucky enough to have it. And whether or not they count it explicitly as an asset on their balance sheets, in practice it gives them a powerful bulwark against competitors and startups. It’s no longer enough for a couple of grad students to come up with a better search algorithm than Google’s, for example; they would also have to build a global network of massive server farms – and have acquired exabytes of data. So possession of large quantities of data greatly heightens the barrier to entry for competitors and thereby strengthens incumbents. The more data you have, the better.

The ICO’s recent fines, however, cast a shadow on this cosy scene. Possessing oodles of data is only an unalloyed good if you can protect it from thieves, hackers and other criminals. If you can’t, then that precious asset can suddenly turn toxic – just like fossil fuel reserves….

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