Category Archives: Tech

Bitcoin: The First Digital Ponzi Scheme

If you had invested $100 in Bitcoin in 2011, two years after it was invented, and if you had held onto it through the 2014 crash, when Mt. Gox, the biggest Bitcoin exchange, collapsed, today you’d have (almost) $4 million in your pocket.

That’s what the Winklevoss twins of Facebook fame and founders of the Gemini exchange did: They are, historically, the first believers and biggest investors in Bitcoin and today, now that they’ve turned bitcoin billionaires in 2017 (the only ones so far), they continue to believe in it, saying they won’t give it up, that “long-term, directionally, it’s a multi-trillion dollar asset”.

2017 was a special year. By December, the valuation of Bitcoin and the 700+ digital currencies that it has spawned had grown explosively, from less than $1,000 per bitcoin to over $15,000. 2018 is not looking so good, market cap is falling, but still high:

As shown above: By end 2017, total market capitalization (value) of all digital currencies exceeded $750 billion, though it is now falling fast and stands well below that value (520 billion on January 17, 2018): this is still and extraordinary multiple (16 times) of where it was a year ago SOURCEGLOBAL MARKET CAPITALIZATION CHART 28 April 2013 TO 17 January 2018 

On 17 January, Bloomberg spoke of a 26% slump noting that “traders brave the volatility” though some (rightly) worry about the growing threat from government regulations.

SO WHERE ARE WE GOING WITH BITCOIN?

To find out, read the rest on Impakter, click here.

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Filed under Economics, politics, Tech, Sociology, Business

I Support Net Neutrality!

Come and join me in this fight! Your freedom depends on it. Seriously. Read this excellent article written by my friend Hannah Fischer-Lauder – I am so happy to share it with you here, it’s just published on Impakter:

NET NEUTRALITY WAR: TRUMP WHITE HOUSE VS. SILICON VALLEY

by HANNAH FISCHER-LAUDER

On November 21, the new head of the Federal Communications Commission (FCC), Mr Ajit Pai, detonated a bomb on the Internet, announcing his plan to do away with net neutrality.

Why a bomb?

It’s very simple: eliminating net neutrality is a direct threat to consumers, start-ups and small businesses. A threat to all of us. It is the end of an open Internet. Anyone who cannot pay for access will be penalized.

IN THE PHOTO:  Internet user with a laptop. PHOTO CREDIT:  GLENN CARSTENS-PETERS on UNSPLASH

DOES MR PAI CARE?

No, despite the avalanche of pro-net neutrality comments that flooded the FCC website when it called for comments (as it must, by law), he disregarded what real people had to say to him. I write “real people” because the FCC website got so messed up – hackers even attacked it in May –  that, in the end, there were 22 million plus comments, most of them from bots.

Bots, fake comments on a government website? Yes, it’s not a joke. NY Attorney General Schneiderman on 21 November, in an open letter to the FCC Chairman, told him that in his estimation, hundreds of thousands of Americans’ identities were stolen and used in spam campaigns to support repealing net neutrality.

But there’s more.

Read the rest on Impakter, click here.

Be sure to go to the end of the article, it gives you tips (and links) on what you can do to help in the fight against the FCC planned repeal of net neutrality regulations. And there’s a lot you can do, sign petitions, write letters, share online. 

Mr. Pai has scheduled the FCC vote on repeal for December 14. There is no time to lose!

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Filed under Business, politics, Tech

Don’t Be Evil: The Other Side of the Tech Industry

Another one of my articles published on Impakter:

HOW TO ADDRESS THE TECH WORLD’S MORAL BLINDNESS

Who leads the tech world and what is their impact on the economy? Put together two remarkable statistics:

  • Of the ten richest men in America, only three are not tech billionaires: Warren Buffett and the Koch brothers;
  • Tech firms represent 21% of the 500 largest American firms, yet they employ only 3% of the workforce (Guardian, 2017);

and you get an exact description of the New Golden Age.

We’ve moved from the Robber Barons of the 1900s to the tech billionaires of the 2000s. Same concentration of wealth, same political and economic power, same income inequality, same moral blindness – with one big difference that hurts the working class: compared to the Robber Barons and the manufacturing giants of the 1950s, they create very few jobs.

Worse: The ‘frightful fives’ – Apple, Google (Alphabet), Amazon, Microsoft and Facebook, as noted by the New York Times’ columnist Farhad Manjoo –  are gobbling up start-ups, buying out the most successful rather than allowing healthy competition to develop. This puts the very process of innovation at risk. Instagram, WhatsApp, DeepMind are some of the better-known examples.

The rise of tech is affecting not just the economy, but our politics and culture too, twisting and straining the moral fibre of our society. In his 2016 speech at the Hiroshima Peace Memorial, Obama somberly noted that “technological progress without an equivalent progress in human institutions can doom us”. And he reminded us that “the scientific revolution that led to the splitting of the atom requires a moral revolution as well.”

The moral revolution certainly has not arrived in Trump’s America, focused for now on its America First agenda, denying climate change and trying to rebuild the coal-based manufacturing of the 1950s instead of addressing the real challenges of the future. Challenges that stem from tech industry AI products, robots and supercomputers, displacing jobs and ruining the middle and lower classes.

Tax havens are a big part of the story.

After the Panama Papers, we now have the scandal of another offshore firm, the Appleby files. Among Appleby’s long list of ultra-rich clients, including 31,000 Americans, we find a range of businessmen, pop stars and royals, including George Soros, the financier and philanthropist, Carl Icahn, the equity investor, Sheldon Adelson, the casino magnate, Madonna, Bono and even (for the first time) Queen Elizabeth II.

Inevitably, we find tech titans like Microsoft co-founder Paul G. Allen.

IN THE PHOTO: FROM LEFT TO RIGHT, PAUL G. ALLEN, GEORGE SOROS, BONO AND QUEEN ELIZABETH. SOURCE: COLLAGE FROM PHOTOS IN WIKIMEDIA COMMONS 

 

While bashing the tech industry on moral grounds has become fashionable, how useful it is in curbing it is debatable. After all, the tech industry has changed our lives, sometimes for the worse, to be sure, but also for the better. And the industry has many friends and supporters, not to mention ample lobbying power both in Washington and Brussels. And so long as the industry is making money, criticism, however right and morally grounded, will fall on deaf ears.

There are other ways to curb the tech industry and ensure it becomes a responsible citizen.

To read the rest on Impakter, click here.

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Filed under Business, Tech

Platform Capitalism: The New Economy of the Future?

My latest article, just published on Impakter Magazine:

BOOK REVIEW: PLATFORM CAPITALISM BY NICK SRNICEK, PUBLISHED BY POLITY (DECEMBER 2016) 120 PAGES

Platform Capitalism

Platform capitalism is the latest buzzword, replacing what used to be called “eco-systems”. It is also sometimes confused with the “gig economy” or the “sharing economy”, enthusiastically embraced by politicians as the answer to the Great Recession.

Uber, AirBnB, TaskRabbit and the like are viewed as saviors, providing jobs to those who wouldn’t have any or rounding off the pay of those who make too little. Their apps create a digital space where service providers and users meet; the needs of the latter are satisfied by the former while the app owners take a fair percentage off every transaction.

THE BLESSED AGE OF POST-CAPITALISM?

Technology enthusiasts see platform capitalism, created by the digital revolution, as a benign form of capitalism ushering in a new blessed age where people come into their own, workers find instant demand for their services and consumers get what they want at the tap of a button on their smartphone.

Before we go on, let’s get one piece of semantics out of the way: Platform capitalism should not be confused with the “sharing economy” (insofar as it exists at all). Platform capitalism has nothing to do with “sharing” in the sense of an exchange of goods or services at no cost to those engaged in the exchange. Platform capitalism is capitalism pure and simple: You pay for the goods and services you get, nothing is free – even if transaction costs tend to be lower online. Lower but still substantial: Uber, for example, creams off 25 percent of every taxi ride. The difference is that it’s not done through an exchange of cash in the real world, it is done digitally.

And, according to the proponents of platform capitalism, there is an added advantage: The middleman is cut out, costs to users are thus automatically reduced. This is the capitalism of the future, they enthuse. Thanks to the digital revolution, we are into the age of “post-capitalism”.

Not true, argue the critics: The basic exploitative nature of capitalism has not changed. Middlemen are replaced by new gatekeepers. “Many of the old middlemen and retailers disappear but only to be replaced by much more powerful gatekeepers,” complained one disgruntled German blogger.

Is platform capitalism heralding a bright new future or is it just the latest form of exploitative capitalism?

Read the rest on Impakter, click here.

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Filed under Book review, Digital Revolution, Economics, non-fiction, politics, Startups, Tech

SILICON VALLEY: WHAT IT TAKES TO DO STARTUPS – Book Review

Here’s another one of my articles published today on Impakter:



SILICON VALLEY: WHAT IT TAKES TO DO STARTUPS

Book Review: Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley by Antonio Garcìa Martinez (HarperCollins, 2016, 528 pages)

Chaos Monkeys Book Cover

Silicon Valley continues to be hot news in the age of Trump and anti-globalization and it should come as no surprise that a clever book about it by someone in the know, loaded with revelatory insights on how it really works, was going to be a sure-fire hit. And that is exactly what happened when Antonio García Martinez’s half memoir-half prescriptive tech guidebook came out last year on 28 June 2016, becoming an instant “New York Times bestseller”. Considered an “irreverent exposé of life inside the tech bubble”, all the major book reviewers rushed in with praise, from the New York Times’ Jonathan E. Knee (“an irresistible and indispensable 360-degree guide to the new technology establishment”) to Bloomberg’s Ellen Huet (“dives into the unburnished, day-to-day realities: the frantic pivots, the enthusiastic ass-kissing, the excruciating internal politics”).

In short, in just six months, “Chaos Monkeys” has become the most popular and widely read book about Silicon Valley. I was curious to find out whether it merited its sudden glory. I uploaded it to my Kindle (disclosure: living far from bookstores, I am a fan of e-books) and I spent a couple of pleasant days enjoying the read. And I soon discovered that the best passages, literally pearls in the text, had been highlighted hundreds of time by enthusiastic fans. In fact, Amazon in its “about the book” section informs you that (at the time of my reading) 3,769 passages had been highlighted 122,000 times (ah, the joys of Big Data).

It is a clever book with a clever title, and a great read. In case you’re wondering about the title, it comes from the name given to the software procedure used to test the stability and resilience of online services/websites – and this neatly expresses the main message of the book: That tech entrepreneurs are society’s chaos monkeys, out to disrupt the way we live, from photo-sharing (Instagram), dating (Tinder) and movie viewing (Netflix) to transport (Uber), lodging (AirBnB) and space travel (SpaceX).

Unquestionably, the author’s persona was as much part of the excitement as his bracing writing style. Described as an “industry provocateur” on his Amazon book description page, he has lived up to his reputation and become something of an industry guru: today, whenever big news or scandals roil Silicon Valley, journalists rush to ask him his opinion.

 

Garcìa Martinez started his working life as a strategist for Goldman Sachs, survived three years and surprised everyone by abandoning New York for the West Coast. After learning the ropes at an IT advertising outfit called Adchemy, he launched his own start-up AdGrok with a couple of engineering pals (called “the boys” in his book). Ten months later, after raising some venture capital and before even making AdGrok operational, he sold it to Twitter for $5 million. However, it was not an unmitigated success; his team broke up, “the boys” went to work for Twitter to develop AdGrok while he accepted a more lucrative position at Facebook as product manager. Tasked with leveraging Facebook’s user data to make its advertising more effective and fix its monetization problem, he was outcompeted by a colleague and fired – the circumstances of his firing make for fascinating reading.

The description of what Facebook is like, what happened there and why he eventually left and landed an advisory position at Twitter is certainly one of the more interesting parts of the book – anyone thinking of joining Facebook should read it very carefully, drawing lessons from it.

The rest on Impakter, to read it, click here.

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Filed under Book review, Digital Revolution, Publishing, Startups, Tech, Uncategorized