Author: Jaron Lanier
Jaron Lanier
Reading time: 20 minutes
Synopsis
Who Owns the Future? (2014) looks at what is going wrong in today’s internet economy. It explains why this economy destroys more jobs than it creates. These Blinks show how big internet companies like Google and Facebook work. They also show how we, as a society, should react to new technology.
What’s in it for you: Learn about the ‘free’ culture online from a new angle.
The music industry has suffered a lot in recent years. Companies like Napster, YouTube, and Spotify completely changed how they used to sell music. Now, the industry earns only a quarter of what it used to. But other areas are also changing because of the internet economy. For example, medicine, education, and transport. Many people will lose their jobs because of this.
The internet is not like other new inventions from the past. It is a revolution that will change everything. These Blinks will tell you why.
You will learn:
- that smartphones could soon be made with 3D printers,
- why every mosquito bite is important in the age of Big Data, and
- why you will soon wish you had read Facebook’s terms and conditions more carefully.
Blink 1 – The internet is not like other inventions.
In early 19th-century England, one invention caused a lot of trouble. The mechanical loom was a new machine. It made cloth faster than ever before. It had another big advantage: It did not need a monthly salary, unlike the many workers who lost their jobs because of it.
Soon, an angry crowd gathered. They were poor and wanted to show their anger. These jobless people broke into factories. They destroyed the machines that took their work. Today, we call this movement Luddism. It is named after its leader, Ned Ludd.
This part of history did not end dramatically. The workers found new jobs, and their anger went away. But it shows a fear we still have today: Will new technology make us unnecessary?
The pattern is always the same: First, a new machine or method is invented. It helps to do a task, like making clothes, more easily. Then, fewer workers are needed for that job. Many people in that industry lose their jobs. Jobless people suffer until new jobs appear elsewhere. Then, they find work again. This cycle helps the economy grow.
This pattern has happened many times in history. Many people think that the internet and the new information economy also follow this pattern. This is the big growth of the fourth economic sector.
We all know many examples of this. For example, travel agencies lost many customers because people can book hotels and flights online. Also, local video stores closed because we can now watch films online easily.
If things followed the usual pattern, the internet should create new jobs to replace the old ones. Also, people who create content online should be paid for their work. But content shared online is often free. This means the economy does not grow as it did with past inventions. However, the internet sector is growing fast. So, where does the money go?
Blink 2 – The real money is made secretly.
To understand the internet economy better, let’s look at the most successful companies: Facebook and Google.
These two powerful online companies are similar in one way: they offer their services for free. We don’t pay for a Facebook account or most of Google’s services. Also, these companies do not create their own content. Instead, they let users create it for them. On Facebook, users make their own pages and write posts and comments. Google just provides links to other people’s websites. So, if their services are free, how do these companies get so rich?
Most of their money comes from advertising. Both Google and Facebook show us ads when we look at search results or our friends’ profiles.
These ads work very well. Companies pay a lot for them because the ads reach the right people. Our online activities and actions give Facebook detailed information. This includes our hobbies, what we like, and our age or location. Because of this, Facebook can offer advertisers a very specific group of people to target. Google does the same thing. It uses the keywords we type into the search engine.
Some companies even sell the information they collect to other companies. This gives them new ways to earn money. And this is not illegal. In fact, we often give them permission to do this. Before using any online service, we agree to a ‘User License Agreement’. Ideally, we would spend hours reading this document. But in reality, this often doesn’t happen, and it can have bad results. Hidden in the legal language, which almost no one reads, are parts that allow the company to watch us and sell our data.
Blink 3 – Free offers trick us into giving our data.
It’s not just big companies like Google that track what we do online. Many other companies want to collect user data too. They want to be the main source of data for attractive, paying customers. Even a simple click on the New York Times homepage can start many tracking cookies. These cookies follow what you do next.
This is not just about sending you targeted ads. Companies that track data search through a lot of information, called Big Data. They often do this for other reasons. For example, insurance companies use this data to decide how much you pay for insurance. In finance, watching online trends helps people make smart investments. If a computer program shows that mosquito bites are a common topic online, a smart person can quickly invest in a company that makes mosquito bite cream. Politicians also use Big Data. They find voters who might support them. Then they try to win their votes.
Big Data is also very important for artificial intelligence. AI cannot work without human input. For example, Google Translate cannot translate as well as a human translator. But it works surprisingly well. It searches the internet for all existing translations of the sentence you type in. Without human translations, Google’s services would not exist or would be much worse.
Companies that work this way are called Siren Servers. They promise free services. Then, they use the private access we give them to our online activity. This helps them collect user data. This data helps them to control us more easily. It gives them money and power.
Blink 4 – Siren Servers become the only providers.
At first, all these activities seem like a clever business model. They make money and appear to help the economy. So, what is the problem with Siren Servers?
The problem is that they slowly become monopolies. The internet allows them to collect information from all over the world. They can serve the global market. This reduces the benefits that small local businesses with special local knowledge once had.
Once these local businesses are gone, Siren Servers fight each other for power online. The more information a company collects, the better its services become. This attracts more users, which helps the company get even more information. This cycle keeps getting stronger. It finally leads to one company becoming a monopoly.
This works very well for providers whose services get better as more people use them. Facebook is the most famous example. The network would not be half as interesting if fewer people were registered there. In fact, according to Metcalfe’s Law, the value of a communication system grows faster as more people use it.
Also, these providers make it hard for us to stop using their services. They often become such a big part of our lives that a world without them would seem much less practical. For example, Facebook helps us connect and stay in touch with others. The fear of losing these connections if we leave Facebook keeps us tied to the social network.
These things help monopolies to form. But monopolies harm the economy in several ways. For example, they limit choices for consumers. But the effects can be even more serious.
Blink 5 – More and more industries are failing because of the fourth sector.
We might accept Siren Servers having a monopoly if they created many new jobs and helped our economy grow. But sadly, this is not happening.
Even though big internet companies keep growing, they hire few new staff. They keep other costs low, apart from staff wages for technical support and finance. For example, Facebook lets its users create their own content.
Unlike past technological changes, the internet economy does not boost our economic growth. Instead, it leads to the decline of many industries, especially in creative fields. More and more jobs are lost in music, photography, and journalism.
This change is very clear in the music industry. New things like Napster and YouTube made the traditional industry shrink fast. It used to sell music. But now, users can listen to music online for free, any time. Today, it is only about a quarter of its size during its best times.
It is easy to make songs, photos, and videos digital, copy them, and share them. Because of this, creative people see the value of their work fall quickly. The ‘free’ mindset of the internet is clear. Free copies flood the market. Fewer and fewer people want to pay for the product. Why should we pay, you might ask, when Facebook lets us post these songs and videos on its site? But often, the artists themselves do not profit from this.
Blink 6 – Technology will take over jobs in every industry.
Not only the music industry, but every industry that moves into the digital world will lose jobs. What’s more, every industry will have to move into the digital world.
If this future prediction seems too much, think about this example. A few years ago, it might have seemed impossible: Self-driving cars use information about their surroundings. Once they become normal everywhere – they are already legal in some countries – many taxi and truck drivers will lose their jobs. They simply won’t be needed anymore.
Here is another extreme example from the Japanese health system: By 2020, robots are planned to care for older people instead of nurses. And one day, even tiny robots called nanobots will help with surgery.
Even old traditions like school teaching and university lectures are at risk. Today, many lectures and learning materials are available online for free. On one hand, this gives many people great learning chances. On the other hand, teachers and university lecturers may worry about their jobs.
What about manufacturing? It has changed a lot with new technology over time. But could factories become completely unnecessary in the future? With new inventions, this is quite possible. 3D printers let us download product designs online and print them at home easily. Soon, even complex devices like smartphones could be made by 3D printers. This would mean many workers in electronics factories would lose their jobs. Of course, we would still need factories to make the printers. But this would not make up for the large number of jobs lost.
It seems we are moving towards a world where everything is digital and can be easily shared online. Human work is not always needed for this anymore. So thousands of jobs are at risk. How can we escape this downward spiral?
Blink 7 – Users should be paid for the information they provide.
The main problem is that there is no middle class. People who provide information and content are not paid for their work. Siren Servers take all the profits. If we let this continue, it will harm the Siren Servers themselves in the end. They need people who can afford to buy things to show effective ads.
How can we solve this problem? It’s simple: The information we provide must be paid for. Not by us, but by the Siren Servers. This means we should get money for every piece of information we give. For example, a sentence that helps a translation program. We should get money from the company that earns from this translator. Similarly, social media companies should pay us for videos or music recommendations we post. They benefit from these posts.
These payments would be small. They would be based on the value you create. But these small amounts, like tenths and hundredths of cents, would add up to a larger sum over time. This payment could be instant, with companies paying a set price for each piece of information. Or it could be a commission, later, based on the profit we help create.
In this way, companies would have to pay internet users for the content they create. Companies would then use this content, not for free, but for a fair price. This system would create a humanistic information economy.
Blink 8 – Two-way links allow payment to information providers.
To pay small fees to those who provide information, we need to use two-way links. These links find both the creator and the user of specific content. This kind of system is called a Nelsonian Network, after its inventor Ted Nelson.
In such a network, we could see all the companies that link to our information. Then we would know exactly who owes us money. Secret spying would stop. We would know exactly who uses our information for business.
To keep a fair balance between company profits and payments to information providers, we need a central group to make decisions. This group would likely be paid for by taxes.
This central group could include government officials or a group of Siren Servers who support the new system. Both options seem far away right now. But the risk of a recession, caused by the middle class shrinking, might force both sides to create such a system.
Of course, this system would have many problems at the start. But in the long run, it would solve a problem that we cannot avoid. It is possible that all our industries will eventually become part of the information sector. And if those who provide information are not paid, the capitalist idea behind the system must fail.
Blink 9 – Summary
The main message of these Blinks is:
We help internet companies in two ways: We give them information about ourselves and what we like. We also provide them with content. Because of this, these companies collect a lot of free content. This helps them attract more users. Then they place targeted ads and earn money. So, we are the base of their business model – and we should be paid fairly for it.
Do you have feedback?
We are excited to hear what you think of our Blinks! Just send an email to [email protected] with the title of this book as the subject. Share your thoughts with us.
For Further Reading: Ten Arguments for Deleting Your Social Media Accounts Right Now by Jaron Lanier
Here, Jaron Lanier uses social media to show how we are all controlled and used. It is a strong call to delete your social media profiles.
Source: https://www.blinkist.com/https://www.blinkist.com/de/books/wem-gehort-die-zukunft-de