Is the Internet The Answer

Pink Floyd’s Roger Waters recently announced that he “felt enormously privileged to have been born in 1943 and not 1983, to have been around when there was a music business and the takeover of Silicon Valley hadn’t happened and, in consequence, you could still make a living writing and recording songs and playing them to people”.

For Waters the Valley is a “gallery of rogues and thieves”.  Andrew Keen – author of The Internet Is Not The Answer – agrees. Keen mourns the demise of Soho’s Berwick St, the “mile of vinyl” – once home to many independent music shops -with which his family had connections. Abundant content, much of it pirated on an industrial scale, has put these shops out of business. Music consumers have become habituated to ‘free’ and bands make little from streaming platforms.

For a four person band in the US to each make the minimum wage of $15,080, their music would have to get 1/4 trillion plays on Spotify.

Robber Barrens
At the heart of Keen’s account sits a cause – the winner takes all economics of the internet and a motley crew of villains – the 1% who enjoy a new kind of capitalism. Keen likens these successful entrepreneurs, and the VC and private equity investor behind them, to the ‘robber barrens’ of the early 20th century such as Carnegie and Rockefeller.

Keen’s diagnosis is gloomy. He argues that the internet revolutions has resulted in:

“fewer jobs, an over-abundance of content, an infestation of piracy, a coterie of internet monopolists and a radical narrowing of our economic and cultural elite.”

He sees the internet’s fall from its age of innocence as the result of its original sin: the lust for personal data and its “aggressive expansions ..into our personal relationships” (those are the words, ironically, of Snapchat CEO Evan Spiegel). This hunger for data and encroachment into our lives are then amplified by the network effect. The result is a winner takes all world where a few companies wreak creative destruction on industries, community and wider society.

Creative Destruction
A chapter exploring the impact of the internet on jobs includes a depressing tour of Rochester, CT, home to what’s left of Kodak. Keen details how robots, AI and automation will build on the software that has already eaten up many legacy business. He cites Oxford University research that suggests that

“47% of all American jobs might be lost in the next couple of decades”.

Is, he asks, Kodak a sneak preview of the future?

Exploring the relationship between individuals and internet companies Keen points up the fundamental asymmetries at play. We’re working for free in data factories of others making. Happily creating value, turning our attention into valuable digital exhaust for others to monetise in environments that are ‘addictive by design’. As security expert Bruce Scheier has suggested: “the primary business model of the internet is built on mass surveillance.”

This is ultimately a book about the economics of the internet that is light on economics. It’s strong on the emergence of a TaskRabbit economy and the new ‘precariat’. But it is missing full description and analysis of the underlying drivers and mechanics of this ‘winner takes all’ world. Putting it all down to Metcalfe’s Law – the network effect – is a bit unsatisfying.

It’s an account of technology-induced change that is too light on historical precedents. The history of technology can help us understand how societies have responded to earlier phases of mechanisation and automation. When it comes to the impacts of technology humans have quite some experience to go on but it is absent from this book.

Keen probably overplays his hand, and in so doing weakens his case. I’m not sure a privatised world populated by driverless Ubers servicing the needs of tech entrepreneurs who have declared independence from the 99% is just around the corner. A less bombastic account might have been more plausible. Companies like Uber clearly raise questions about regulation, market entry tactics, labour practices and taxation but its customers and drivers seem pretty enchanted by it. It can’t be all bad.

Keen’s book is also localised. Over two recent visits to San Francisco and Silicon Valley I’ve realised that his account is better read as a polemic based on this hotbed of fantastical wealth creation and jaw dropping poverty and inequality.

The Google luxury air-con buses of which he writes are all the more jarring when set against the potholes and pan-handlers of the Mission district. The internet, pundits alleged, would vanish geography. It didn’t. Keen might have written a better book if he’d look beyond his own backyard.

These criticisms aside, this is an important book. Since 1991, when Berners-Lee made the WWW public, or in the c.7,500 days since the launch of Windows 95, the web has made big in-roads into most aspects of our daily lives. The social and economic impacts of the internet have been colossal.

Rapid and violent though this change has been – and despite the occasional moral panic – it has been environmental. Like frogs warming in a saucepan of water we’ve been immunised to the changing world we are living through. It is good to pause for thought, to reflect on what has happened and where it has left us, and where next.

If one thing is certain it is this: if we think we’ve seen rapid technology shifts in the last 20 years, we ain’t seen nothing yet.