Over at LinkedIn I’ve published a short piece on Web3 – a primer of sorts for the many marketing pals who’ve asked me “does this shit matter!?”. As I do with everything I pen, I’ve posted it here as well. (image credit)
In the more than 30 years since the digital revolution swept through marketing, most of us have adapted to the ever-present change inherent in what has become a technology-driven profession. But there remains a sense that we’ve lost something crucial – that creativity and true connection with our customers has been replaced by an ever more inscrutable system of tech-mediated platforms. We pour billions each year into media-tech giants like Google and Meta, and yet we yearn for a world where technology enables our business, rather than dictating it.
Wasn’t that the promise of the Internet, after all – a one-to-one relationship with our customers, at scale?
Where did that promise go?
Marketers aren’t the only ones asking this question. Every so often a new set of ideas emerges from the world of tech that feels like a sea change. The World Wide Web – sometimes referred to as “the Open Internet” – was the first of these shifts. The second was the mobile phone, and with it the rise of social media and its data-rich platforms, yielding to us the framework under which we now labor.
It’s that framework – which many now call “Web2” – that has birthed many of our most existential concerns: The public’s fear of surveillance capitalism, lawmakers’ perception of oligarchy amongst the platform giants, and most importantly, our own loss of agency given our dependence upon them*. In short, the technology industry feels ripe for a shift away from its current state of play.
If you’ve read this far, you already know that this shift now has a name: Web3. So, what is Web3, and why does it matter to marketing professionals? And most importantly: What problem is Web3 trying to solve?
A Matter of Philosophy
At its core, Web3 is a philosophy. That might sound like a non sequitur – isn’t Web3 supposed to be about technological marvels like the blockchain, cryptocurrencies, and “the metaverse” – whatever that is? Well, yes, and we’ll get to that in later columns, but to understand Web3, we must also understand its core beliefs – and to not too fine a point on it, those beliefs align with an arguably radical return to the original philosophy of the Internet, best summarized by one word: Decentralization.
I’m simplifying here, and Web3 is a complicated topic (one that’s currently undergoing its own version of the dot com crash, but that’s another post). In short, the technologists, pundits, and proponents of Web3 believe our current technological landscape is broken, largely due to the consolidation of economic value driven by the rise of large platform players like Google, Amazon, Apple and Meta/Facebook. While they’ve driven unprecedented value for shareholders and consumers alike, today’s Internet giants have done so by employing an approach diametrically opposed to the original values of the Internet.
And what are those original values? First among them is decentralization. Internet originalists believe the power to innovate and to create value should lie with end users, not with centralized platforms or corporations. A second value is openness, also known as portability – that users, entrepreneurs, brands, and anyone else can move fluidly around the Internet, bringing with them their data, their preferences, and their resources without fear of being locked into any one platform or organization. Another key value is interoperability – that companies and platforms adhere to a transparent set of protocols and standards that allow for robust exchange of value across the Internet. A related value is composability – that various services and programs can be combined, again through technological standards, to create ever more innovative and valuable systems.
A Better Future
In the end, the central philosophical pillar of Web3 is decentralization. As Web3 proponent (and prolific investor) Chris Dixon puts it: “Centralized platforms have been dominant for so long that many people have forgotten there is a better way to build Internet services.” The building blocks of Web3 – blockchains, token-based currency projects like Bitcoin and Ethereum, distributed autonomous organizations (DAOs), non-fungible tokens (NFTs) – are all part of a growing movement to remake the Internet free of centralized control. Will it work? Again, those are topics for future posts.
But should marketers pay attention? Absolutely.
From privacy concerns to measurement, brand safety to increasingly impossible creative constraints (who can tell a brand story in .7 seconds?!) – I’ve lost count of how many senior marketers have privately complained to me about the stranglehold Internet giants hold over their budgets, their go to market strategies, and their connections to customers. Publicly, CMOs are more cautious – we’re all afraid of the market power the platforms hold. But who amongst us wouldn’t like to see the status quo upended by a new wave of innovation that puts power back in the hands of consumers?
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*This ultimate definition of “Web2” differs massively from the original vision of Web2 that Tim O’Reilly and I pursued through our Web2 Summit series of events and white papers back in 2004-11.
Caveat: This will likely be one of my longish, link-heavy Thinking Out Loud pieces, so I invite you all to pour yourselves a glass of your favorite adult beverage or rustle up a fine cannabis pairing, should you care to indulge…
Two years ago The Recount moved out of beta with our first daily product. A short summary of national news, The Daily Recount was designed to cut through the bullshit endemic to mainstream media. As we grew, The Recount cultivated an incisive voice that never wastes time, rejects tired tropes, and focuses on the core values of journalism: Identifying the truth, holding powerful interests to account, and reflecting the world as it is today, not the way it used to be.
Twelve months later, that voice had found a huge audience on Twitter – which in 2020 was pretty much the white-hot center of the political narrative we were covering. In my post summarizing that first year, I laid out what we’d learned, and how the audience who had gathered around our work was responding. And I indulged in a bit of boasting: “Since launch one year ago,” I crowed, “our work has been viewed more than half a billion times.”
This past week marked something of a milestone for The Recount – we launched a pilot marketing partnership with P&G, a company I’ve worked closely with over the past ten years. We’re testing out Twitter’s Amplify program, which pairs quality editorial with contextually relevant marketing content. The initial portion of the partnership centers on a unique creative asset: A 60-second film called “Lead with Love,” the centerpiece of a major campaign focused on P&G’s commitment to making the world a better place in 2021.
Yes, I’m writing about the power of advertising here, and I’m about to praise a long time partner. For those of you already rolling your eyes, you’re welcome to move right along…but my point has to do with the ability of nuanced and intentional commercial speech to shift the tone of discourse in this country, something I believe we all desperately need. As P&G Chief Brand Officer Marc Pritchard has said to me countless times, advertising can be powerful speech, and companies have a duty to wield it responsibly.
For the past several years, I’ve led a graduate-level class studying the early history of Internet policy in the United States. It runs just seven weeks – the truth is, there’s not that much actual legislation to review. We spend a lot of the course focused on Internet business models, which, as I hope this post will illuminate, are not well understood even amongst Ivy-league grads. But this past week, one topic leapt from my syllabus onto the front pages of every major news outlet: Section 230. Comprised of just 26 words, this once-obscure but now-trending Internet policy grants technology platforms like Facebook, Google, Airbnb, Amazon, and countless others the authority to moderate content without incurring the liability of a traditional publisher.
Thanks to the events of January 6th, Section 230 has broken into the mainstream of political dialog. Slowly – and then all of a sudden – the world has woken up to the connection between the disinformation flooding online platforms and what appears to be the rapid decay of our society.
Yes, it’s true: Last year, I did not predict a global pandemic in 2020. COVID is a gravitational force that warps everything it touches, so I approach this annual ritual of self-grading with trepidation. As I start, I honestly don’t remember what I predicted twelve months ago…but regardless, I’m expecting a train wreck. I’ll read each one in turn, repeat the headline prediction, and then free associate some thoughts on what actually transpired. Grab a glass of your favorite beverage…and here we go:
Facebook bans microtargeting on specific kinds of political advertising. OK, Facebook did NOT do this – well, not exactly. What the company DID do was ban political advertising altogether – but only in the week before, and a short period after the US election. Of course, you can certainly say that by banning all political advertising, the company ended up banning microtargeting as a result. So that’s one argument for giving myself a “Nailed It.” If that’s too weak an argument, let’s go to the fine print in my original prediction: “The pressure to do something will be too great, and as it always does, the company will enact a half-measure, then declare victory.” And that is exactly what the company did. I mean, exactly. I also wrote: “The company’s spinners will frame this as proof they listen to their critics, and that they’re serious about the integrity of the 2020 elections. As with nearly everything it does, this move will fail to change anyone’s opinion of the company. Wall St. will keep cheering the company’s stock, and folks like me will keep wondering when, if ever, the next shoe will drop.” Yup. Nailed it.
Netflix opens the door to marketing partnerships. This prediction requires a bit of clarification. I was not claiming Netflix would open the door to advertising on its platform, but rather that it “may take the form of a co-produced series, or branded content, or some other “native” approach, but at the end of the day, it’ll be advertising dollars that fuel the programming.” What I didn’t realize when I made this prediction was that Netflix was already deep into product placement deals for its Netflix Originals, and that it had already made sure the money changed hands somewhere else (such as between a production company and a brand). There is no doubt that marketing money positively benefits Netflix’s bottom line – and the practice absolutely accelerated in 2020, as did everything streaming-related during COVID. But there was not a significant shift in Netflix policy related to marketing that I can find, so I’m going to say I whiffed on this one.
CDA 230 will get seriously challenged, but in the end, nothing gets done, again. This is exactly what happened. In fact, it’s happening as I type this – Trump just vetoed a veto-proof defense funding bill because it doesn’t repeal 230, and Biden has already indicated he plans to rethink 230 next year. But even though tens of millions of American citizens became familiar with Section 230 this year, nothing came of all that noise. Nailed it.
Adversarial interoperability will get a moment in the sun, but also fail to make it into law. OK I have GOT to stop writing predictions about obscure academic terminology. I mean, what the actual f*ck? What I was trying to say was this: In 2020, there would be a robust debate about the best ways to regulate Big Tech, and the ideas behind “adversarial interoperability” would get a rigorous airing. This did not happen, and just like Jeffrey Katzenberg, I blame COVID. Exactly no one wanted to debate tech policy in the middle of a global pandemic. Making things worse, toward the end of this year multiple governmental agencies decided it was time to go after Big Tech, and they went batshit with proactive lawsuits – the DOJ and a majority of states sued Google (three times, no less), the FTC sued Facebook, and I’d put money more suits are coming (looking at you, Apple and Amazon). The suits revolve around antitrust law, so the debate will now be dominated by whether or not the government can prove its case in court. This effectively postpones intelligent debate about remedies for years. I find this state of affairs deeply annoying. But a grade must be given, and that grade is a whiff, unfortunately.
2020 will also be the year “data provenance” becomes a thing. Literally stop me from ever writing predictions after hitting the flash evaporator, OK?! This was another policy-related prediction, and if I was going to miss #4 above, I’m certainly going to whiff here as well. In the very rare case you want to know what I was on about, this is how I described the concept: “The concept of data provenance started in academia, migrated to adtech, and is about to break into the broader world of marketing, which is struggling to get its arms around a data-driven future. The ability to trace the origin, ownership, permissions, and uses of data is a fundamental requirement of an advanced digital economy, and in 2020, we’ll realize we have a ton of work left to do to get this right.” Well, in fact, if you believe Google Trends, “data provenance” did have a marked lift in 2020. Does that qualify it for “becoming a thing”? I have no f*cking idea. And again, thanks to COVID, marketers were not exactly focused on public ledgers and blockchain in 2020. Note to self: Stop predicting that something will “become a thing.” Inane. Whiff.
Google zags. Oh man, oh man, I feel so close on this one. I mean, there are still a few days left in 2020, right? I honestly think this is about to happen. Here’s how I explained it one year ago: “Saddled with increasingly negative public opinion and driven in large part by concerns over retaining its workforce, Google will make a deeply surprising and game changing move in 2020.” Google’s problems with both public perception (hello, three government lawsuits!) and an unhappy workforce only deepened this year – the Timnit disaster was just the most public of its struggles. But so far the company hasn’t produced a dramatic “game changing” move. Sure, the FitBit acquisition finally closed, but if that proves material, I’ll … start using a FitBit again. I firmly believe that Google must make a game changing move, and soon, if it’s going to keep its mojo. But….it certainly hasn’t happened yet. So…sigh…Whiff.
At least one major “on demand” player will capitulate. Just weeks into 2020, I was well on my way to a “Nailed It” here. The tide was turning on the entire category: Uber was in trouble and badly below its IPO price, GrubHub was a falling knife looking for a buyer, PostMates had shelved its IPO dreams. And then…COVID reordered the universe, making on demand everything an essential part of quarantine life. The entire category was supercharged – I mean, DoorDash at 19 times sales?!?! – and yet another of my predictions bit the dust. F U, COVID. Whiff.
Influencer marketing will fall out of favor. Well, if ever there was a year to be sick of influencer marketing, it’d be this one. But no, with sports and entertainment programming suspended for the majority of the year, all that marketing budget had to go somewhere, and lord knows it wasn’t going to support news (despite that being the most engaged and highest growth category of all). So…brands threw in even more with influencers. In my explanation I predicted that influencer fraud would be a huge problem – and by most accounts it is (the last figure I could find was 1.3 billion in 2019 – which was roughly 20 percent of the overall market!). But…influencer marketing did not fall out of favor, Charlie D’Amelio is making $50K per post, and damnit, I whiffed again.
Information warfare becomes a national bogeyman. Finally, a slam dunk. Man, I was starting to question myself here. “Deep fakes, sophisticated state-sponsored information operations, and good old fashioned political info ops will dominate the headlines in 2020,” I wrote. Yep, and true to form, 2020 saved the scariest example for the end of the year. Nailed it.
Purpose takes center stage in business. Here’s one prediction where COVID actually accelerated my take toward a passing grade. The year began with BlackRock’s stunning declaration that it would make investment decisions based on climate impact. Once COVID and the George Floyd murder came, nearly the entire Fortune 500 began recalibrating their communication strategies around racial, gender, and climate equity issues. Last year I wrote “I expect plenty of CEOs will feel emboldened to take the kind of socially minded actions that would have gotten them fired in previous eras.” Whether it was P&G on climate and race, Nike saying “Don’t Do It,” or nearly every major sports league standing with the Black Lives Matter movement, companies have taken previously unimaginable stands this year. Nailed It.
Apple and/or Amazon stumble. Sure, Apple did pay up to half a billion to bury its “batterygate” scandal but let’s be honest, you forgot about that, right? Even the publication of a terrifying expose of worker conditions in iPhone manufacturing plants failed to dent the company in 2020. But what you likely will remember is the Epic Fortnite story – and to me, that’s the stumble that tips my prediction to a “Nailed It.” Apple’s response to Epic was ham fisted and short sighted. The company misread regulators’ appetite for antitrust, deeply injured its reputation amongst developers, and exposed the iOS App Store – the source of its most important growth revenues – as a pristine monopoly just begging for a Federal compliant. Meanwhile, while Amazon profited handsomely from COVID, the company’s reputation has only worsened in 2020. A drumbeat of negative press about unsafe working conditions, union busting, and anticompetitive practices culminated in a broadside from one of its own – Tim Bray, a respected technologist (and early reader of Searchblog) who penned a damning Dear John letter to his former employer in May. Despite the strength of both companies’ stock prices, I think it’s safe to say that both Apple and Amazon stumbled in 2020. Nailed It.
Next week I’ll be writing Predictions 2021 — let’s hope this is the start of an upward trend…
A new year brings another run at my annual predictions: For 17 years now, I’ve taken a few hours to imagine what might happen over the course of the coming twelve months. And my goodness did I swing for the fences last year — and I pretty much whiffed. Batting .300 is great in the majors, but it kind of sucks compared to my historical average. My mistake was predicting events that I wished would happen. In other words, emotions got in the way. So yes, Trump didn’t leave office, Zuck didn’t give up voting control of Facebook, and weed’s still illegal (on a federal level, anyway).
Chastened, this year I’m going to focus on less volatile topics, and on areas where I have a bit more on-the-ground knowledge — the intersection of big tech, marketing, media, and data policy. As long time readers know, I don’t prepare in advance of writing this post. Instead, I just clear a few hours and start thinking out loud. So…here we go.
Facebook bans microtargeting on specific kinds of political advertising. Of course I start with Facebook, because, well, it’s one of the most inscrutable companies in the world right now. While Zuck & Co. seem deeply committed to their “principled” stand around a politician’s right to paid prevarication, the pressure to do something will be too great, and as it always does, the company will enact a half-measure, then declare victory. The new policy will probably roll out after Super Tuesday (sparking all manner of conspiracies about how the company didn’t want to impact its Q1 growth numbers in the US). The company’s spinners will frame this as proof they listen to their critics, and that they’re serious about the integrity of the 2020 elections. As with nearly everything it does, this move will fail to change anyone’s opinion of the company. Wall St. will keep cheering the company’s stock, and folks like me will keep wondering when, if ever, the next shoe will drop.
Netflix opens the door to marketing partnerships. Yes, I’m aware that the smart money has moved on from this idea. But in a nod to increasing competition and the reality of Wall St. expectations, Netflix will at least pilot a program — likely not in the US — where it works with brands in some limited fashion. Mass hysteria in the trade press will follow once this news breaks, but Netflix will call the move a pilot, a test, an experiment…no big deal. It may take the form of a co-produced series, or branded content, or some other “native” approach, but at the end of the day, it’ll be advertising dollars that fuel the programming. And while I won’t predict the program augurs a huge new revenue stream for the company, I can predict that what won’t happen, at least in 2020: A free, advertising-driven version of Netflix. Just not in the company’s culture.
CDA 230 will get seriously challenged, but in the end, nothing gets done, again. Last year I predicted there’d be no federal data privacy legislation, and I’m predicting the same for this year. However, there will be a lot of movement on legislation related to the tech oligarchy. The topic that will come the closest to passage will be a revision to CDA 230 —the landmark legislation that protects online platforms from liability for user generated content. Blasphemy? Sure, but here we are, stuck between free speech on the one hand, massive platform economics on the other, and a really, really bad set of externalities in the middle. CDA 230 was built to give early platforms the room to grow unhindered by traditional constraints on media companies. That growth has now metastasized, and we don’t have a policy response that anyone agrees upon. And CDA 230 is an easy target, given conservatives in Congress already believe Facebook, Google, and others have it out for their president. They’ll be a serious run at rewriting 230, but it will ultimately fail. Related…
Adversarial interoperability will get a moment in the sun, but also fail to make it into law. In the past I (and many others) have written about “machine readable data portability.” But for the debate we’re about to have (and need to have), I like “adversarial interoperability” better. Both are mouthfuls, and neither are easy to explain. Data governance and policy are complicated topics which test our society’s ability to have difficult long form conversations. 2020 will be a year where the legions of academics, policy makers, politicians, and writers who debate economic theory around data and capitalism get a real audience, and I believe much of that debate will center on whether or not large platforms have a responsibility to be open or closed. As Cory Doctorow explains, adversarial interoperability is “when you create a new product or service that plugs into the existing ones without the permission of the companies that make them.” As in, I can plug my new e-commerce engine into Amazon, my new mobile operating system into iOS, my new social network into Facebook, or my new driving instruction app into Google Maps. I grew up in a world where this kind of innovation was presumed. It’s now effectively banned by a handful of data oligarchs, and our economy – and our future – suffers for it.
As long as we’re geeking out on catchphrases only a dork can love, 2020 will also be the year “data provenance” becomes a thing. As with many nerdy topics, the concept of data provenance started in academia, migrated to adtech, and is about to break into the broader world of marketing, which is struggling to get its arms around a data-driven future. The ability to trace the origin, ownership, permissions, and uses of data is a fundamental requirement of an advanced digital economy, and in 2020, we’ll realize we have a ton of work left to do to get this right. Yes, yes, blockchain and ledgers are part of the discussion here, but the point isn’t the technology, it’s the policy enabling the technology.
Google zags. Saddled with increasingly negative public opinion and driven in large part by concerns over retaining its workforce, Google will make a deeply surprising and game changing move in 2020. It could be a massive acquisition, a move into some utterly surprising new industry (like content), but my money’s on something related to data privacy. The company may well commit to both leading the debate on the topics described above, as well as implementing them in its core infrastructure. Now that would really be a zag…
At least one major “on demand” player will capitulate. Gig economy business models may make sense long term, but that doesn’t mean we’re getting the execution right in the first group of on demand “unicorns.” In fact, I’d argue we’re mostly getting them wrong, even if as consumers, we love the supposed convenience gig brands bring us. Many of the true costs of these businesses have been externalized onto public infrastructure (and the poor), and civic patience is running out. Plus, venture and public finance markets are increasingly skeptical of business models that depend on strip mining the labor of increasingly querulous private contractors. A reckoning is due, and in 2020 we’ll see the collapse of one or more larger players in the field.
Influencer marketing will fall out of favor. I’m not predicting an implosion here, but rather an industry wide pause as brands start to ask the questions consumers will also be pondering: who the fuck are these influencers and why are we paying them so much attention? A major piece of this — on the marketing side anyway — will be driven by a massive increase in influencer fraud. As with other fast growing digital marketing channels, where money pours in, fraud fast follows — nearly as fast as fawning New York Times articles, but I digress.
Information warfare becomes a national bogeyman. If we’ve learned anything since the 2016 election, it’s this: We’ve taken far too long to comprehend the extent to which bad actors have come to shape and divide our discourse. These past few years have slowly revealed the power of information warfare, and the combination of a national election with the compounding distrust of algorithm-driven platforms will mean that by mid year, “fake news” will yield to “information warfare” as the catchphrase describing what’s wrong with our national dialog. Deep fakes, sophisticated state-sponsored information operations, and good old fashioned political info ops will dominate the headlines in 2020. Unfortunately, the cynic in me thinks the electorate’s response will be to become more inured and distrustful, but there’s a chance a number of trusted media brands (both new and old) prosper as we all search for a common set of facts.
Purpose takes center stage in business. 2019 was the year the leaders of industry declared a new purpose for the corporation — one that looks beyond profits for a true north that includes multiple stakeholders, not just shareholders. 2020 will be the year many companies will compete to prove that they are serious about that pledge. Reaction from Wall St. will be mixed, but I expect plenty of CEOs will feel emboldened to take the kind of socially minded actions that would have gotten them fired in previous eras. This is a good thing, and likely climate change will become the issue many companies will feel comfortable rallying behind. (I certainly hope so, but this isn’t supposed to be about what I wish for…)
Apple and/or Amazon stumble. I have no proof as to why I think this might happen but…both these companies just feel ripe for some kind of major misstep or scandal. America loves a financial winner — and both Amazon and Apple have been runaway winners in the stock market for the past decade. Both have gotten away with some pretty bad shit along the way, especially when it comes to labor practices in their supply chain. And while neither of them are as vulnerable as Facebook or Google when it comes to the data privacy or free speech issues circling big tech, both Apple and Amazon have become emblematic of a certain kind of capitalism that feels fraught with downside risk in the near future. I can’t say what it is, but I feel like both these companies could catch one squarely on the jaw this coming year, and the post-mortems will all say they never saw it coming.
So there you have it — 11 predictions for the coming year. I was going to stop at 10, but that Apple/Amazon one just forced itself out — perhaps that’s me wishing again. We’ll see. Let me know your thoughts, and keep your cool out there. 2020 is going to be one hell of a year.
This is an edited version of a series of talks I first gave in New York over the past week, outlining my work at Columbia. Many thanks to Reinvent, Pete Leyden, Cap Gemini, Columbia University, Cossette/Vision7, and the New York Times for hosting and helping me.
Prelude.
I have spent 30-plus years in the tech and media industries, mainly as a journalist, observer, and founder of companies that either make or support journalism and storytelling. When it comes to many of the things I am going to talk about here, I am not an expert. If I am expert at anything at all, it’s asking questions of technology, and of the media and marketing platforms created by technology. In that spirit I offer the questions I am currently pursuing, in the hope of sparking a dialog with this esteemed audience to further better answers.
Some context: Since 1986, I’ve spent my life chasing one story: The impact of technology on society. For whatever reason, I did this by founding or co-founding companies. Wiredwas kind of a first album, as it were, and it focused on the story broadly told. The Industry Standardfocused on the business of the Internet, as did my conference Web 2. Federated Media was a tech and advertising platform for high quality “conversational” publishers, built with the idea that our social discourse was undergoing a fundamental shift, and that publishers and their audiences needed to be empowered to have a new kind of conversation. Sovrn, a company I still chair, has a similar mission, but with a serious data and tech focus. NewCo, my last company (well, I’ve got another one in the works, perhaps we can talk about that during Q&A) seeks to illuminate the impact of companies on society.
It’s Broke. Let’s Fix It.
And it is that impact that has led me to the work I am doing now, here in New York. I moved here just last Fall, seeking a change in the conversation. To be honest, the Valley was starting to feel a bit…cloistered.
A huge story – the very same story, just expanded – is once again rising. Only it’s just … more urgent. 25 years after the launch of Wired, the wildest dreams of its pages have come true. Back in 1992 we asked ourselves: What would happen to the world when technology becomes the most fundamental driver of our society? Today, we are living in the answer. Turns out, we don’t always like the result.
Most of my career has been spent evangelizing the power of technology to positively transform business, education, and politics. But five or so years ago, that job started to get harder. The externalities of technology’s grip on society were showing through the shiny optimism of the Wired era. Two years ago, in the aftermath of an election that I believe will prove to be the political equivalent of the Black Sox scandal, the world began to wake up to the same thing.
So it’s time to ask ourselves a simple question: What can we do to fix this?
Let’s start with some context. My current work is split between two projects: One has to do with data governance, the other political media. How might they be connected? I hope by the end of this talk, it’ll make sense.
So let’s go. In my work at Columbia, I’m currently obsessed with two things. First,
Data.
How much have you thought about that word in the past two years?
Given how much it’s been in the news lately, likely quite a lot. Big data, data breaches, data mining, data science…Today, we’re all about the data.
And second….
Governance.
When was the last time you thought about that word?
Government – well for sure, I’d wager that’s increased given who’s been running the country these past two years. But Governance? Maybe not as much.
But how often have you put the two words together?
Data Governance.
Likely not quite as much.
It’s time to fix that.
Why?
Because we have slouched our way into an architecture of data governance that is broken, that severely retards economic and cultural innovation, and that harms society as a whole.
Let’s unpack that and define our terms. We’ll start with Governance.
What is governance? It’s an …
Architecture of control
A regulatory framework that manages how a system works. The word is most often used in relation to political governance – which we care about a lot for the purposes of this talk – but the word applies to all systems, and in particular to corporations, which is also a key point in the research we’re doing.
But in my work, when I refer to governance, I am referring to the “the system of rules, practices and processes by which a firm controls its relationshipto its community.” Who’s that community? You, me, developers and partners in the ecosystem, for the most part. More on that soon.
Now, what is data? I like to think of it as…
Unrefined Information.
I’m not in love with this phrase, but again, this is a first draft of what I hope will grow to more refined (ha) work. Data is the core commodity from which information is created, or processed. Data has many attributes, not all of which are agreed upon. But I think it’s inarguable that the difference between data and information is …
Human meaning.
That’s Socrates, who thought about this shit, a lot. Information is data that means something to us (and possibly the entire universe, as it relates to the second law of thermodynamics. But physics is not the focus of this talk, nor is a possible fourth law of thermodynamics….).
As we’ve learned – the hard way – over the past decade, there are a few very large companies which have purview over a massive catalog of meaningful data, meaningful not only to us, but to society at large. And it’s this societal aspect that, until recently, we’ve actively overlooked. We’re in the midst of a grand data renaissance, which if history remotely echoes, I fervently hope will give rise to …
A (Data) Enlightenment
That’s John Locke, an Enlightenment philosopher. Allow me to pull back for second and attempt to lay some context for the work I hope to advance in the next few years. It starts with the Enlightenment, a great leap forward in human history (and the subject of a robust defense by Steven Pinker last year).
Arguably the crowning document of the Enlightenment is…
The United States Constitution
This declaration of the rights of humankind (well mankind for the first couple of centuries) itself took more than three centuries to emerge (and cribbed generously from the French and English, channeling Locke and Hume). Our current political and economic culture is, of course, a direct descendant of this living document. American democracy was founded upon Enlightenment principles. And the cornerstone of Enlightenment ideas is …
The Scientific Method
That’s Aristotle, often credited with originating the scientific method, which is based on considered thesis formation, rigorous observation, comprehensive data collection, healthy skepticism, and sharing/transparency. The scientific method is our best tool, so far, for advancing human progress and problem solving.
And the scientific method – the pursuit of truth and progress – all that turns on the data. Prompting the question….
Who Has the Most (and Best) Data?
This is the question we are finally asking ourselves, the answer to which is sounding alarms. As we all know, we are in a renaissance, a deluge, an orgy of data creation. We have invented sophisticated new data sensing organs – digital technologies – that have delivered us superhuman powers for the discovery, classification, and sense-making of data.
Not surprisingly, it is technology companies, driven as they are by the raw economics of profit-seeking capital and armed with these self-fulfilling tools of digital exploration and capture – that have initially taken ownership of this emerging resource. And that is a problem, one we’ve only begun to understand and respond to as a society. Which leads to an important question:
Who Is Governing Data?
In the US, anyway, the truth is, we don’t have a clear answer to this question. Our light touch regulatory framework created a tech-driven frenzy of company building, but it failed to anticipate massive externalities, now that these companies have come to dominate our capital markets. Clearly, the Tech Platform Companies have the most valuable data – at least if the capital markets are to be believed. Companies like Google. Facebook. Amazon. Apple.
All of these companies have very strong governance structures in place for the data they control. These structures are set internally, and are not subject to much (if any) government regulation. And by extension, nearly all companies that manage data, no matter their size, have similar governance models because they are all drafting off those companies’ work (and success). This has created a phenomenon in our society, one I’ve recently come to call …
The Default Internet Constitution
Without really thinking critically about it, the technology and finance industries have delivered us a new Constitution, a fundamental governance document controlling how information flows through the Internet. It was never ratified by anyone, never debated publicly, never published with a flourish of the pen, and it’s damn hard to read. But, it is based on a discoverable corpus. That corpus, at its core, is based on …
Terms of Service and EULAs
Like it or not, there is a governance model for the US Internet and the data which flows across it: Terms of Service and End User Licensing Agreements. Of course, we actively ignore them – who on earth would ever read them? One researcher did the math, and figured it’d take 76 work days for the average American to read all of the policies she clicks past (and that was six years ago!).
Of course, ignoring begets ignorance, and we’ve ignored Terms of Service at our peril. No one understands them, but we certainly should – because if we’re going to make change, we’ll want to change these Terms of Service, dramatically. They create the architecture that determines how data, and therefore societal innovation and value, flow around the Internet.
And let’s be clear, these terms of service have hemmed data into silos. They’re built by lawyers, based on the desires of engineers who are – for the most part – far more interested in the product they are creating than any externalities those products might create.
And what are the lawyers concerned with? Well, they have one True North: Protect the core business model of their companies.
And what is that business model? Engagement. Attention. And for most, data-driven personalized advertising. (Don’t get me started about Apple being different. The company is utterly dependent on those apps animating that otherwise black slate of glass they call an iPhone).
So what insures engagement and attention? Information refined from data.
So let’s take a look at a rough map of what this Terms of Service-driven architecture looks like:
The Mainframe Architecture
Does this look familiar? If you’re a student of technology industry history, it should, because this is how mainframes worked in the early days of computing. Data compute, data storage, and data transport is handled by the big processor in the sky. The “dumb terminal” lives at the edge of the system, a ‘thin client’ for data input and application output. Intelligence, control, and value exchange lives in the center. The center determines all that occurs at the edge.
Remind you of any apps you’ve used lately?
But it wasn’t always this way. The Internet used to look like this:
The Internet 1.0 Architecture
I’m one of the early true believers in the open Internet. Do you remember that world? It’s mostly gone now, but there was a time, from about 1994 to 2012, when the Internet ran on a different architecture, one based on the idea that the intelligence should reside in the nodes – the site – not at the center. Data was shared laterally between sites. Of course, back then the tech was not that great, and there was a lot of work to be done. But we all knew we’d get there….
…Till the platforms got there first. And they got there very, very well – their stuff was both elegant and addictive.
But could we learn from Internet 1.0, and imagine a scenario inspired by its core lessons? Technologically, the answer is “of course.” This is why so many folks are excited by blockchain, after all (well that, and ICO ponzi schemes…).
But it might be too late, because we’ve already ceded massive value to a broken model. The top five technology firms dominate our capital markets. We’re seriously (over)invested in the current architecture of data control. Changing it would be a massive disruption. But what if we can imagine how such change might occur?
This is the question of my work.
So…what is my work?
A New Architecture
If we’re stuck in an architecture that limits the potential of data in our society, we must envision a world under a different kind of architecture, one that pushes control, agency, and value exchange back out to the node.
Those of us old enough to remember the heady days of Web 1.0 foolishly assumed such a world would emerge unimpeded. But as Tim Wu has pointed out, media and technology run in cycles, ultimately consolidating into a handful of companies with their hands on the Master Switch – we live in a system that rewards the Curse of Bigness. If we are going to change that system, we have to think hard about what we want in its place.
I’ve given this some thought, and I know what I want.
Let The Data Flow
Imagine a scenario where you can securely share your Amazon purchase data with Walmart, and receive significant economic value for doing so (I’ve written this idea up at length here). Of course, this idea is entirely impossible today. This represents a major economic innovation blocked.
Or imagine a free marketplace for data that allows a would-be restaurant owner to model her customer base’s preferences and unique taste? (I’ve written this idea up at length here). Of course, this is also impossible today, representing a major cultural and small business innovation is impeded.
Neither of these kinds of ideas are even remotely possible – nor are the products of thousands of similar questions entrepreneurs might ask of the data rotting in plain sight across our poorly architected data economy.
We all lose when the data can’t flow. We lose collectively, and we lose individually.
But imagine if it was possible?!
How might such scenarios become reality?
We’re at a key inflection point in answering that question.
2019 is the year of data regulation. I don’t believe any meaningful regulation will pass here in the US, but it’ll be the year everyone talks about it. It started with the CA/Facebook hearings, and now every self-respecting committee chair wants a tech CEO in their hot seat. Congress and the American people have woken up to the problem, and any number of regulatory fixes are being debated. Beyond the privacy shitstorm and its associated regulatory response, which I’d love to toss around during Q&A, the most discussed regulatory relief is anti-trust – the curse of bigness is best fixed by breaking up the big guys. I understand the goal, and might even support it, but I don’t think we need to even do that. Instead, I submit for your consideration one improbable, crazy, and possibly elegant solution.
It requires one thing: Every data processing service at a certain scale must deliver back to its customers any co-created data in machine readable format, easily portable to any other data processing service.
Imagine the economic value unlocked, the exponential impact on innovation such a simple rule would have. Of course we must acknowledge the negative short term impact such a policy would have on the big guys. But it also creates an unparalleled opportunity for them – the token of course can include a vig – a percentage of all future revenue associated with that data, for the value the platform helped to create. This model could drive a far bigger business in the long run, and a far healthier one for all parties concerned.
I can’t prove it yet, but I sense this approach could 10 to 100X our economy. We’ve got some work to do on proving that, but I think we can.
Imagine what would occur if the data was allowed to flow freely. Imagine the upleveling of how firms would have to compete. They’d have to move beyond mere data hoarding, beyond the tending of miniature walled gardens (most app makers) and massive walled agribusinesses (in the case of the platforms – and ADM and Monsanto, but that’s another chapter in the book, one of many).
Instead, firms would have to compete on creating more valuable tokens – more valuable units of human meaning. And they’d encourage sharing those tokens widely – with the fundamental check of user agency and control governing the entire system.
The bit has flipped, and the intelligence would once again be driven to the nodes.
To us!
But the Token Act is just an exercise in envisioning a society governed by a different kind of data architecture. There are certainly better or more refined ideas.
And to get to them, we really need to understand how we’re governed today. And now that I’ve gotten nearly to the end of my prepared remarks, I’ll tell you what I’m working on at Columbia with several super smart grad students:
Mapping Data Flows
If we are going to understand how to change our broken architecture of data flows, we need to deeply understand where we are today. And that means visualizing a complex mess. I’m working with a small team of researchers at Columbia, and together we are turning the Terms of Service at Amazon, Apple, Facebook and Google into a database that will drive an interactive visualization – a blueprint of sorts for how data is governed across the US internet. We’re focusing on the advertising market, for obvious reasons, but it’s my hope we might create a model that can be applied to nearly any information rich market. It’s early stages, but our goal is to have something published by the end of May.
Finally, Advertising
I’ve not spoken much about advertising during this talk, and that was purposeful. I’ve written at length about how we came to the place we now inhabit, and the role of programmatic advertising in getting us there.
Truth is, I don’t see advertising as the cause of this problem, but rather an outgrowth of it. If you offer any company a deal that puts new customers on a platter, as Google did with AdWords, or Facebook has with NewsFeed, well, there’s no way those companies will refuse. Every major advertiser has embraced search and social, as have millions of smaller ones.
Our problem is simply this: The people who run technology platforms don’t actually understand the power and limitations of their systems, and let’s be honest, nor do we. Renee Di Resta has pointed this out in recent work around Russian interference in our national dialog and elections: Any system that allows for automated processing of messages is subject to directed, sophisticated abuse. The place for regulation is not in advertising (even though that’s where it’s begun with the Honest Ads Act), it’s in how the system works architecturally.
But advertisers must be highly aware of this transitional phase in the architecture of a system that has been a major source of revenue and business results. We must imagine what comes next, we must prepare for it, and perhaps, just perhaps, we should invent it, or at the very least play a far more active role than we’re playing currently.
I believe that if together – industry, government, media and consumers collectively – if we unite to address the core architectural issues inherent to how we manage data, in the process giving consumers economic, creative, and personal agency over the data they co create with platforms, the question of toxic advertising will disappear faster than it arose.
But I’ve talked (or written) long enough. Thank you so much for coming (for reading), and for being part of this conversation. Now, let’s start it.
