Conscious labour and supreme blessings

To be well caring of mother, of father, to look after spouse and children, to engage in a harmless occupation, this is a blessing supreme.

This line is from a discourse with the Buddha known as the Mangala Sutta. The Buddha is approached in a grove and is asked about the “blessings supreme.” He lists 38 (included below) including not associating with fools, abstaining from intoxicants, looking after your family, and other common sense responsibilities that one has to choose to be blessed.

In the above quote, “to engage in a harmless occupation” really stands out to me. Although the Buddha might be referring to soldiery or banditry, two occupations that he was surrounded with on his journey around northeastern India, I have a different reading.

In recent years I have thought long and hard about what work I do. Most recently I spent two and a half years in adtech. Trying to come up with ways to make people click more online ads might be joked away as a “harmless occupation”, but as I became immersed in the business I began to become uneasy about all the negative externalities of adtech: loss of privacy, financialization, content commoditization, botnets and clickfraud. The sheer amount of money in that vertical attracts many entrepreneurs, but the amount of waste is astounding. I only half-joke that the person who actually figures out “The Attribution Problem” (ie. which click lead to which purchase: what digital marketing was supposed to solve for us, but hasn’t by a long shot) would win a Nobel Prize and simultaneously destroy about 80% of the digital advertising space. Ensuring that consumers get what they want in an efficient manner is a bedtime story advertisers tell themselves, and is lost amongst the harmful noise.

So, I left. Continue reading “Conscious labour and supreme blessings”

Event: OnPoint – Do we need a new relationship with transportation and mobility in our region?

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What are the possibilities for city beyond transportation? How do we think about transportation in terms of making a city more vibrant, rather than a deadening concrete grid where we travel isolated in our cars?

On December 8th I will be on the panel for the Urban Systems On Point Series Getting Unstuck – Do we need a new relationship with transportation and mobility in our region?. The event is the fourth in the series, and happens at the Laurel Packinghouse from 7PM. There is wine, food and music, and about 200 to 300 interesting people to meet and mingle with. See all the details and get your FREE tickets here →

I will be on the panel with a few others to discuss transportation. Here are some related posts on this blog that will likely be mentioned on stage:

Nostalgic utopianism — a review of Throwing Rocks at the Google Bus

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Throwing Rocks at the Google Bus: How Growth Became the Enemy of Prosperity  by Douglas Rushkoff

Power corrupts and money ruins everything. These are basically the premises that Douglas Rushkoff starts from in his latest book, a critique of the concentration of power in the digital economy and the inequality it breeds. He uses the protests targeting private Google buses in 2013 to highlight the inequality driven by the US economy dominated by the monopolous forerunners of the digital economy. I was in SF at the time, and commented on what I saw:

I was struck by how conflicted the city is. The chasm between those in tech and those not in tech is nearly at class-warfare levels. Almost daily there are articles about the chasm widening (eg. the recent Google Bus demonstration). To get better sense of the civic strife, read the following link-filled article: Silicon Valley Is Living Inside A Bubble Of Tone-Deaf Arrogance.

Rushkoff has always been writing on the edges of technology and society. Now he tries his hand at technology and economics. His argument is that the digital economy is not a disruption, but merely an extension of the industrial age, with the problematic bits of that era even more acute. He takes great pains to show the monopolistic tendencies of networks and the ill effects of “digitally accelerated capitalism.” The evidence that he provides is damning, but his framework of analysis is not particularly convincing. His mistake is to analyze corporations using McLuhan’s tetrad of media effects, which ends up looking like this:

  1. What does the corporation enhance?
  2. What does the corporation make obsolete?
  3. What does the corporation retrieve that had been obsolesced earlier?
  4. What does the corporation flip into when pushed to extremes?

It is an interesting thought experiment, but ultimately fails where more traditional economic arguments would succeed. The results are muddled. For example in chapter 21 he criticizes mainstream economic education, yet nowhere in the book does he name alternative economic models. The terms “neoliberalism”, “socialism”, “socialist democracy” never appear in the book. “Communism” pops up a handful of times, but only in a defensive matter:

For a business to find its appropriate size even if this means scaling down is not a Communist Plot. [pp. 105]

Rushkoff fears being accused as “communist” above all else, and that ends up undermining his argument. For Rushkoff, there is only Capitalism and Communism. His understanding of political theory comes off as unsubtle, but maybe it is the the limited of understanding of his audience that is influencing him, aka. the big tech CEOs that ask him for advice running their companies or hire him for highly paid corporate speaking engagements. This economic calculus might be the reason for Rushkoff’s lukewarm critique. He is not willing to go to the radical, or use radical language for fear of alienating his audience (née customers). The result is a fuzzy, friendly, plush toy critical theory. He is good at pointing out how damaging capitalism is, but instead of rejecting it, he dreams of a more “conscious” capitalism, a more “humane” capitalism. His solution is go back to a pre-industrial economic model, like the putting out system. Imagine a massive distributed network of makers 3D printing bespoke items for their neighbours out of their handmade cottages. This is how it should have been. Rushkoff is a nostalgic utopian, and this is further evidenced by his analysis of the internet.

Many of the greatest hits of 1990s internet theory are covered in this book, each critiqued and shown how they were not bourne out in the past decade and a half. Rushkoff gives a recent history lesson, showing how terrible things currently are, but then wishes things were like the old theorists thought it would be. Rushkoff is an early model cyberutopian.

However, there is a difference: the saviour of our society is not necessarily technology(!). In fact, Rushkoff argues that it comes down to how we structure our firms and our economy that will save society (aka. politics). That being said, he still thinks that distributed technologies can play a big role in achieving a less centralized system. Thus, Rushkoff’s view might be categorized alongside Steven Johnson’s peer progressivism (see some of my old thinking about PP here).

Throwing Rocks at the Google Bus might not be the final wrench in the gears of our system of unfettered cyber-capitalism, but it is still worth the read. There are some excellent arguments in here against our addiction to growth, some cool examples of alternative transaction systems (local currencies, time dollars, LETS), and a spectacular takedown of startups and venture capital near the end of the book. Despite coming up short in its overall analysis, it is a good book to recommend to a friend who has just started to smell something bad in tech, knows something wrong, but is not quite ready for a full-blown attack on the real underlying problem: capitalism itself.

The Seven revenue models

Consider the following chart showing how the Revenue per User flows for each of the major mobile platforms:

dediu_rev_models

The chart belongs to a presentation where Horace Dediu looks at the future of online services. (Disclaimer: I have not been to the event, nor have I seen the presentation.)

At first glance, my first impression was: “Only four revenue models?” (Transaction, Subscription, Ad, or a mix of the three). On second glance: “Wow Advertising is pretty much the same size as Transaction.” But then later, in the shower, I started to ask: “What does ‘transaction’ mean anyways?”

Generally there are 7 revenue models:

  • Production
  • Markup
  • Fee-for-service
  • Commission
  • Advertising
  • Subscription
  • Licensing

Horace has split out Advertising and Subscription in his chart, but Transaction seems to fold a few of those rev models inside of it. So I decided to attempt to reverse engineer the chart. Let’s take a look (click to enbiggen):

Transaction is made up of four subcategories: Transportation, e-commerce, Travel and App. I reorganized each of the companies featured in the slide into their category, then labelled each with one of the five remaining revenue models (Production, Markup, Fee-for-service, Commission and Licensing). This is a complex endeavor since some of these companies do more than one thing. For example Amazon sells its own hardware, sells other people’s products, and licenses you Kindle and Audible books. Ridesharing companies charge you a fee-for-service and then take a commission from the driver (doesn’t sound like “sharing” to me, but that is another post).

Inside of the Transaction category the biggest group belonged to the Markup category. I have no way of separating out production and licensing revenues from those companies, but even simply adding them all up and comparing them you can see that Ads are bigger than any one Transaction subcategory.

dediu_ad_v_markup

Hey, ads are big (and growing), we know that already. But that fact may be hidden in Horace’s chart.

Why go through this exercise?

True, since I do not have access to the data set, and do not know what Horace’s intention is for this particular screencap, I could be speaking out of turn. That said, I find it very interesting to see how consumers are parted with their money, myself included. Think about what you spend your money on each day, and think about what you used to own, compared to what you merely rent or lease today. I don’t own much of anything anymore, not least my hundreds of Kindle and Audible books, iTunes tracks, or Google Play Movies and TV Shows. As a minimalist, I am okay with owning less, but I have issues with proprietary formats (I now use Downpour for audiobooks), and it seems especially egregious as they are pushed into the real world (ahem… John Deere).

For all the talk of innovation there has not been much on the business model side. We have had these 7 revenue models for a long time. Regardless of how dominant the Ads model is, it doesn’t work for everyone, and is in fact failing many of our vital institutions it once supported (ahem… public interest media). Unfortunately, most of the “innovation” around business models have been on the finance side, with very “innovative” accounting and debt models (ahem… [subprime lending](subprime lending)). The results have been runaway household debt and financial collapse. As with all things, technology helps out here too.

So, Innovators, we could use some new revenue models that are straightforward, and not detrimental to consumers.

Recommended reading: Religion and neoliberalism

James Chappel reviews four books in the Boston Review that dig into the link between neoliberalism and religious institutions. I found this piece enlightening just from its perspective on the rise of neoliberalism in general. The idea that neoliberalism is merely “sophisticated common sense” explains its common appeal… just like religion.

Below are a number of choice quotes from the piece, but I recommend reading the entire thing.

“A specter is haunting the academy—the specter of neoliberalism. In response to assaults on racial, gender, and economic equality, scholars from multiple disciplines are turning to neoliberalism as the culprit.”

This is the conclusion I have come to with regards to tech. Continue reading “Recommended reading: Religion and neoliberalism”

The superficiality of living small

Downsizing (or minimalism) is often portrayed as anti-consumerist and eco-friendly. Living small means you buy less stuff, produce less trash, and have a smaller environmental footprint in terms of heating/cooling your home. Plus, if you position your home close to amenities, you walk/bike more and drive less. Secondly, living small is about removing oneself from the current trend of financialization — getting off the mortgage hamster wheel, removing debt dependance, and not participating in surveillance capitalism by using credit cards and the like.

These are all good reasons for downsizing, but is the tactic wrong? It depends on what you are trying to solve for.
Continue reading “The superficiality of living small”

Downsizing

Library of books I never read — Fired!

Closet full of clothes I never wear — Fired!

Old couch and coffee tables taking up space in the living room — Fired!

Living room — Fired!

Credit card debt — Fired!

We’ve been downsizing. Over the past couple of years we have been removing ourselves from the systems of debt and consumerism and working towards living more sustainably. This has proven to be a long process, where one must question every part of one’s life. We are not anywhere near done yet, but we have been building momentum.
Continue reading “Downsizing”

Mobile operating system market share, Feb 2012 from iCrossing. For comparison, see 2011’s numbers. Some standout numbers:

Japan 2011 > 2012

  • iPhone 58% > 48%
  • Android 23% > 46%
  • WAP 12% > 2%
  • Other 7% > 4%

China 2011 > 2012

  • Nokia 59% > 40%
  • iPhone 11% > 12%
  • Android 3% > 22%
  • Other 27% > 26%

Anecdotal, but per my experience I would think that “Other” in Brazil is eaten up by grey market iPhones.

A short review for Free

Many critics were let down that Free: The Future of a Radical Price by Chris Anderson was not The Long Tail: Part 2. I understand the disappointment, but this book takes a different tack. Rather than the unknown future, Free is more about the unknown past. It is an analysis of “free” pricing and non-monetary markets since the 19th Century. Cataloguing and categorizing the usages of “free”, Anderson connects the economic history of the pre-digital age with today’s economics of digital abundance as he first described in The Long Tail. In that sense, it is a sequel.

Anderson tries to get across to a popular audience that “economics” is not all about money changing hands. He tries to establish non-monetary economies in the popular imagination. This will come as no surprise to academics of the dismal science, and the internet-savvy and tech-hounds will already be familiar with Freemium pricing, link and reputation economies — these are part and parcel of growing up with the OneNet that Binds Us. But for those of us raised on the teat of ethernet cables and WiFi, the historical uses of free make an interesting contextual picture of just how far we have come merely in the last decade.

One thing missing from the book is a comparative analysis of the various economies. Anderson does not even go so far as to say that such economies are equivalent, just legitimate. At this point, I think that is the best as he can do. Metrics for measuring non-monetary economies (such as links on the internet) — though not necessarily entirely new — have only become trackable in recent years. Since Mr Anderson tends to release a new book every five years, I am sure he already has the sequel in mind.

Anderson, Chris. Free: the Future of a Radical Price. New York: Hyperion, 2009.

Audiobook downloadable FOR FREE from the US iTunes Store. See Chris Anderson’s blog longtail.com.

Andrew Sullivan misunderstands the “long tail”

A new British study finds that the most pirated pop songs on the internet are those that already top the charts. Instead of giving rise to a “long tail” where small indie acts broaden their appeal online, the study found that digital technology – and music pirating – simply work to reinforce the fat head of mass appeal.

Torrents and their ilk cannot be considered as an aggregator of the long tail of the music industry. Although P2P networks could theoretically have endless storage, they tend to be biased towards the latest and greatest (the “tyranny of the new”). That is why long tail dynamics are much more visible on wide-ranging individual services like iTunes and Netflix, rather than ad hoc personal networks. That said, I still think that P2P networks can be effective at marketing as Jonathan Coulton, Danger Mouse and Trent Reznor have shown.

Andrew Sullivan misunderstands the “long tail”