Even if Bitcoin bites the dust, the genie’s out of the bottle

This morning’s Observer column

If I had a bitcoin for every person I’ve met in the past six months who told me that bitcoin is a scam then I’d be a rich man. Or a poor one, depending in which day of the week we’re talking about. Watching the exchange rate for bitcoins over the past month is like seeing the outline of a rollercoaster on the horizon. On 7 January, for example, a bitcoin was trading at $934; by 27 February it was down to $528; and on 5 March it was $678. So I guess that if you were “investing” (ie speculating) in the things, you’d feel as sick as any Alton Towers customer on a bad day.

But here’s the really strange thing: while “normal” people – and many mainstream journalists – seem to think that this bitcoin stuff must be some kind of racket, some of the computer scientists and hackers of my acquaintance think it’s the most interesting idea to have come along in ages. And in a way that discrepancy may be the key to understanding the phenomenon…

Read on

Mobile phones: huge industry, no new ideas

This morning’s Observer column.

Leave aside the fact that it was Apple that triggered the most recent explosion in the mobile industry – the smartphone revolution – and ponder what was actually on show in Barcelona. The answer, in the words of one astute and unsentimental observer, Professor Barry Avery, was: “Many phones, little innovation.” (Shades of Yeats’s pithy description of his – and my – native land: “Great hatred, little room.”)

“The message coming out of this year’s event,” wrote Avery, “is that while there are lots of new phones coming, we shouldn’t expect a great technological leap from any of them. Most of the phones are incremental updates, running the latest version of Android’s mobile phone operating system KitKat.”

Avery is too polite. The truth is that the mobile phone industry has run out of ideas. Every single smartphone in the market is basically just a variation on the Apple iPhone theme. And the variations, such as they are, are looking increasingly – and desperately – baroque…

The impending STEM crisis

My Observer comment piece about what’s happening to postgraduate student numbers in UK universities.

Here’s an interesting fact: for the last five years in UK universities, foreign postgraduate students have outnumbered British ones. International student numbers have grown by 90% in the past decade while the number of homegrown students has fallen by 12% in the past three years. And this despite the best efforts of the government and the Border Agency to dissuade students from coming to the UK.

The disproportionate growth in foreign postgraduates is good news for UK universities (because overseas students pay hefty fees), but bad for the society that supports those institutions. And it looks as though the situation will get worse.

Read on

Internet giants: capitalism red in tooth and claw

This morning’s Observer column.

Like the other titans of the online world – Google, Facebook, Yahoo and to a lesser extent, Microsoft – Amazon is driven by data and algorithms. But not entirely. What many of its customers may not realise is that the results generated by Amazon’s search engine are partly determined by promotional fees extracted from publishers. In his book The Everything Store: Jeff Bezos and the Age of Amazon, Brad Stone describes one campaign to exert pressure for better terms on the more vulnerable publishers. It was known internally as the gazelle project, after Bezos suggested “that Amazon should approach these small publishers the way a cheetah would pursue a sickly gazelle”. (With a nice Orwellian touch, company lawyers later changed the name to the “small publisher negotiation programme”.)

That’s a revealing metaphor: capitalism red in tooth and claw. And it’s a useful antidote to the soothing PR of the corporations that now dominate our networked world…

Read on

LATER: Ram Reddy emails to point out Jeff Bezos’s wife’s very critical review of Brad Stone’s book — published on the book’s Amazon.com site. Excerpt:

Everywhere I can fact check from personal knowledge, I find way too many inaccuracies, and unfortunately that casts doubt over every episode in the book. Like two other reviewers here, Jonathan Leblang and Rick Dalzell, I have firsthand knowledge of many of the events. I worked for Jeff at D. E. Shaw, I was there when he wrote the business plan, and I worked with him and many others represented in the converted garage, the basement warehouse closet, the barbecue-scented offices, the Christmas-rush distribution centers, and the door-desk filled conference rooms in the early years of Amazon’s history. Jeff and I have been married for 20 years.

While numerous factual inaccuracies are certainly troubling in a book being promoted to readers as a meticulously researched definitive history, they are not the biggest problem here. The book is also full of techniques which stretch the boundaries of non-fiction, and the result is a lopsided and misleading portrait of the people and culture at Amazon. An author writing about any large organization will encounter people who recall moments of tension out of tens of thousands of hours of meetings and characterize them in their own way, and including those is legitimate. But I would caution readers to take note of the weak rhetorical devices used to make it sound like these quotes reflect daily life at Amazon or the majority viewpoint about working there.

Interestingly, when she came to look for a publisher for her own novel, she took it to an old-fashioned bricks ‘n mortar publisher: Knopf.

Why Year of Code already needs a reboot

This morning’s Observer column.

Last week, my email inbox began to fill up with angry emails. Had I seen the dreadful/unbelievable/disgraceful/hilarious/ (delete as appropriate) Newsnight interview with Lottie Dexter? I hadn’t and as I’d never heard of Ms Dexter I wasn’t unduly bothered. After all, life is too short to be watching Newsnight every night.

Still, the drumbeat of indignation in my inbox was insistent enough to make me Google her.

Finished that ebook yet? Hang on…

This morning’s Observer column.

A few weeks ago I bought a copy of The Second Machine Age by two MIT researchers, Erik Brynjolfsson and Andrew McAfee, who are two of the most insightful commentators currently writing about the likely impact on employment of advanced robotics, machine learning and big-data analytics. Since I already own more physical books than my house and office can hold, I tend now to buy the Kindle version of texts that are relevant to my work, and so it was with the Brynjolfsson and McAfee volume.

Yesterday, I received a cheery email from Amazon. “Hello John Naughton,” it read. “An updated version of your past Kindle purchase of The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies by Erik Brynjolfsson is now available. The updated version contains the following changes: Improved formatting for readability. Significant editorial changes have been made. You can receive the improved versions of all your books by opting in to receive book updates automatically.”

Note the phrase, “significant editorial changes have been made”…

Read on

Facebook @ 10

My piece on Facebook’s first decade.

In fact, the most significant question is not whether teenagers will abandon Facebook, but whether its adoption by huge numbers of adults will result in the fulfilment of Zuckerberg’s vision of owning “the world’s social graph” – the network of humanity’s online social connections. If it does, then our society’s move into completely uncharted territory will be complete.

The reason for this is that, in a strange way, Facebook’s business model is analogous to that of the US National Security Agency. Both need to use surveillance of both intimate and public online activity to make inferences about behaviour. The NSA claims that this enables it to spot and thwart terrorism and other bad stuff. Facebook’s implicit – but rarely explicitly articulated – claim is that intensive monitoring of what its users do enables it to both tailor services to their needs and provide precise targeting information for advertisers.

The difference is that while it’s impossible to know whether the NSA’s surveillance is a cost-effective way of achieving its mission, there’s no doubt that Facebook’s monitoring of its users is paying off, big time – as evidenced by its quarterly results, released last week. The company had revenues of $2.59bn for the three months ending 31 December – up 63% from the same time last year; and for 2013 as a whole it had revenues of $7.87bn, up 55% year-on-year. Its profit last year was $1.5bn.

All of which is pretty good for an outfit created by a Harvard undergraduate in his dorm room 10 years ago. What then of the next 10 years? As with most internet ventures, it’s impossible to say. On the one hand, permissionless innovation might spring another surprise on the world. After all, software is pure thought-stuff and there’s no shortage of geniuses in the profession. This is why many online moguls have Andy Grove’s motto – “only the paranoid survive” – engraved on their psyches. The future of Facebook will be determined by the outcome of a struggle between Metcalfe’s law and the capacity of the net to spring disruptive surprises.

Thirty Years On…

This morning’s Observer column.

Thirty years ago (on 24 January 1984, to be precise), a quirky little computer company launched a new product and in the process changed lives and maybe the world. The company was called Apple and the product was named after a particular type of Californian apple – the Macintosh.

With astonishing chutzpah, the company announced the product to the world via a single advertisement screened during the Super Bowl on 22 January. The film was directed by Ridley Scott and showed a dimly lit auditorium in which ranks of drably clad zombies are being harangued by a despotic figure shown on a huge screen. Into this auditorium comes a beautiful female athlete who runs towards the screen carrying a large hammer, pursued by goons attired in riot police gear. Just as the despot’s rant reaches a climax, the athlete stops, whirls the hammer four times and then launches it at the screen. When it strikes, the screen explodes and the camera pans to the zombies, whose mouths gape in bewilderment. “On January 24th,” intones a voice over the closing scene, “Apple Computer will introduce Macintosh. And you’ll see why 1984 won’t be like Nineteen Eighty-Four.”

Most people who saw the ad were probably baffled by it. But for some of us, the symbology was clear…

Why your health secrets may no longer be safe with your GP

Last Sunday’s Observer column about the NHS plan to create a national database of health records.

Those planning this healthcare data-grab are clearly hoping that citizen inertia will enable them to achieve their aim, which is to make our most intimate personal details available for data-mining by “approved researchers”. If they succeed, then, starting in March, the medical data of everyone who has not opted out will be uploaded to the repository controlled by the NHS information centre. And for the first time the medical history of the entire nation will have been stored in one place.

What’s wrong with this?

How long have you got?

Talking cats and corporate social responsibility

This morning’s Observer column.

It’s 4.30 on a gloomy winter’s afternoon. I’m sitting with my grandson having one of those conversations in which grandsons explain complicated stuff to their grandads. He is four years old, omniscient in the way that four-year-olds are, and tolerant of my ignorance of important matters.

The conversation turns to computing and he inquires whether I have Talking Tom Cat on my iPad. “No,” I say. “What is it?” He explains that it’s a cool game that his grandma has on her iPad. There is a cat called Tom who listens to what you say to him and then repeats it in a funny voice. Also there’s a dog who does funny things.

So I dig out my iPad and we head over to the app store where, sure enough, Talking Tom Cat 2 is available as a free download. A few minutes later it’s running on my iPad…

Read on to find out what happens next.