Category Archives: Observer

How Silicon Valley lost its shine

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This morning’s Observer column:

Remember the time when tech companies were cool? So do I. Once upon a time, Silicon Valley was the jewel in the American crown, a magnet for high IQ – and predominately male – talent from all over the world. Palo Alto was the centre of what its more delusional inhabitants regarded as the Florence of Renaissance 2.0. Parents swelled with pride when their offspring landed a job with the Googles, Facebooks and Apples of that world, where they stood a sporting chance of becoming as rich as they might have done if they had joined Goldman Sachs or Lehman Brothers, but without the moral odium attendant on investment backing. I mean to say, where else could you be employed by a company to which every president, prime minister and aspirant politician craved an invitation? Where else could you be part of inventing the future?

But that was then and this is now…

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Farewell iTunes, hello Music

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This morning’s Observer column:

Last Monday, at Apple’s Worldwide Developers Conference, the company’s head of software engineering, Craig Federighi, announced that it was terminating iTunes. In one way, the only surprising thing was that Apple had taken so long to reach that decision. It’s been obvious for years that iTunes had become baroquely bloated, a striking anomaly for a company that prides itself on elegant and functional design. So the decision to split the software into three functional units – dealing with music, podcasts and TV apps – seemed both logical and long overdue. But for internet users d’un certain âge (including this columnist) the announcement triggered reflections on personal and tech history.

There’s been music on the internet for a long time. The advent of the compact disc in the early 1980s meant that recorded music went from being analogue to digital. But CD music files were vast – a single CD came in at about 700MB – and for most people, the network was slow. So transferring music from one location to another was not a practical proposition. But then, in 1993, researchers at the Fraunhofer Institute in Germany came up with a way of shrinking audio files by a factor of 10 or more, so that a three-minute music track could be reduced to 3MB without much perceptible loss in quality…

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Anyone who thinks that Huawei can be crushed without retribution is deluded

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This morning’s Observer column:

Until recently, the only thing the average citizen could have told you about Huawei, the Chinese tech giant, was that s/he hadn’t the faintest idea of how to pronounce it (it’s “hwa-wei” btw, according to Wikipedia). And then, suddenly, this unpronounceable company seemed to be all over the news. Now it’s at the centre of a burgeoning geopolitical row. How did that happen?

I blame the Australians, who have a government only marginally less dysfunctional than our own…

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Elon Musk may be a pain. But he’s not nuts

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This morning’s Observer column:

You don’t have to be a psychiatrist to wonder if Elon Musk, the founder of Tesla, is off his rocker. I mean to say, how many leaders of US public companies get into trouble with the US Securities and Exchange Commission for falsely claiming that they have secured funding to take their company private at $420 a share – and then get sued and fined $40m? Or can you imagine another CEO who deals with Wall Street analysts by swatting away questions about his company’s capital requirements as if they were flies. “Excuse me. Next. Next,” he replied to one guy who was pressing him on the subject. “Boring, bonehead questions are not cool. Next?”

The view from Wall Street is that Musk is too volatile to be in charge of a big and potentially important public company. The charitable view is less judgemental: it is that, while he may have a short fuse, he’s also a gifted, visionary disrupter. But even those who take this tolerant view were taken aback when he declared at a recent public event that he could see “one million robo-taxis on the roads by 2020”…

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The significance of the WhatsApp hack

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This morning’s Observer column:

When Edward Snowden broke cover in the summer of 2013 and a team of Guardian journalists met up with him in his Hong Kong hotel, he insisted not only that they switch off their mobile phones but also that they put the devices into a fridge. This precaution suggested that Snowden had some special insight into the hacking powers of the NSA, specifically that the agency had developed techniques for covertly taking over a mobile phone and using it as a tracking and recording device. To anyone familiar with the capabilities of agencies such as the NSA or GCHQ, this seemed plausible. And in fact, some years later, such capabilities were explicitly deemed necessary and permissible (as “equipment interference”) in the Investigatory Powers Act 2016.

When Snowden was talking to the reporters in Hong Kong, WhatsApp was a four-year-old startup with an honest business model (people paid for the app), about 200m active users and a valuation of $1.5bn. In February 2014, Facebook bought the company for $19bn and everything changed. WhatsApp grew exponentially to its present ubiquity: it has more than 1.5 billion users and has spread like a rash over the entire planet.

Among its attractions is that it offers users effortless end-to-end encryption for their communications, thereby enhancing their privacy…

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How Microsoft reinvented itself

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This morning’s Observer column:

It may have escaped your attention, but Microsoft recently became the third company in history to reach a valuation of one trillion dollars. To which the standard reaction, I have discovered, is: “Eh? Microsoft!!!” Wasn’t that the boring old monolith fixated on desktop products and operating systems that missed out on the smartphone revolution? The company that Bill Gates used to run before he decided to devote himself full-time to giving his money away? The company whose Exchange Server is the bane of every office-worker’s daily grind? The ruthless monopolist who missed the world wide web and then set out to exterminate the one company – Netscape – that hadn’t?

Yes, that Microsoft. Given the company’s history, this is surely the greatest comeback since Lazarus. But with one difference: where Lazarus’s resurrection was (according to the New Testament) instantaneous, Microsoft’s took longer. How this happened is a story that will keep MBA students occupied for decades, but with the benefit of hindsight, we can now see that it has three main strands…

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The privacy paradox

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This morning’s Observer column:

A dark shadow looms over our networked world. It’s called the “privacy paradox”. The main commercial engine of this world involves erosion of, and intrusions upon, our privacy. Whenever researchers, opinion pollsters and other busybodies ask people if they value their privacy, they invariably respond with a resounding “yes”. The paradox arises from the fact that they nevertheless continue to use the services that undermine their beloved privacy.

If you want confirmation, then look no further than Facebook. In privacy-scandal terms, 2018 was an annus horribilis for the company. Yet the results show that by almost every measure that matters to Wall Street, it has had a bumper year. The number of daily active users everywhere is up; average revenue per user is up 19% on last year, while overall revenue for the last quarter of 2018 is 30.4% up on the same quarter in 2017. In privacy terms, the company should be a pariah. At least some of its users must be aware of this. But it apparently makes no difference to their behaviour.

For a long time, people attributed the privacy paradox to the fact that most users of Facebook didn’t actually understand the ways their personal information was being appropriated and used…

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StreetView leads us down some unexpected pathways

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This morning’s Observer column:

Street View was a product of Google’s conviction that it is easier to ask for forgiveness than for permission, an assumption apparently confirmed by the fact that most jurisdictions seemed to accept the photographic coup as a fait accompli. There was pushback in a few European countries, notably Germany and Austria, with citizens demanding that their properties be blurred out; there was also a row in 2010 when it was revealed that Google had for a time collected and stored data from unencrypted domestic wifi routers. But broadly speaking, the company got away with its coup.

Most of the pushback came from people worried about privacy. They objected to images showing men leaving strip clubs, for example, protesters at an abortion clinic, sunbathers in bikinis and people engaging in, er, private activities in their own backyards. Some countries were bothered by the height of the cameras – in Japan and Switzerland, for example, Google had to lower their height so they couldn’t peer over fences and hedges.

These concerns were what one might call first-order ones, ie worries triggered by obvious dangers of a new technology. But with digital technology, the really transformative effects may be third- or fourth-order ones. So, for example, the internet leads to the web, which leads to the smartphone, which is what enabled Uber. And in that sense, the question with Street View from the beginning was: what will it lead to – eventually?

One possible answer emerged last week…

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Toxic tech?

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This morning’s Observer column:

The headline above an essay in a magazine published by the Association of Computing Machinery (ACM) caught my eye. “Facial recognition is the plutonium of AI”, it said. Since plutonium – a by-product of uranium-based nuclear power generation – is one of the most toxic materials known to humankind, this seemed like an alarmist metaphor, so I settled down to read.

The article, by a Microsoft researcher, Luke Stark, argues that facial-recognition technology – one of the current obsessions of the tech industry – is potentially so toxic for the health of human society that it should be treated like plutonium and restricted accordingly. You could spend a lot of time in Silicon Valley before you heard sentiments like these about a technology that enables computers to recognise faces in a photograph or from a camera…

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Finally, a government takes on the tech companies

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This morning’s Observer column:

On Monday last week, the government published its long-awaited white paper on online harms. It was launched at the British Library by the two cabinet ministers responsible for it – Jeremy Wright of the Department for Digital, Culture, Media and Sport (DCMS) and the home secretary, Sajid Javid. Wright was calm, modest and workmanlike in his introduction. Javid was, well, more macho. The social media companies had had their chances to put their houses in order. “They failed,” he declared. “I won’t let them fail again.” One couldn’t help feeling that he had one eye on the forthcoming hustings for the Tory leadership.

Nevertheless, this white paper is a significant document…

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