Jaron Lanier: The Internet destroyed the middle class
salon.com
salon.com
When I pull 300 high quality pictures off my freaking phone and casually discard 275 of them that I'm not happy with, I still feel as rich as a sultan.
We can't reduce a world wide phenomenon without taking into account hundreds of other factors ( populations in western countries growing old, the globalization, sacrificed generations in Europe and exodus of its skilled youth ) to Kodak vs Instagram.
He was more properly a conservative or classical liberal in the tradition of J.S. Mill: supportive of business and the free market, but supportive of "intelligent monopolies" themselves at times, like the early Bell Telephone system... He also met his intellectual opponents (eg. Marxists) with respect (a rare thing these days), and didn't place market economics at the centre of all human activity as is common with libertarian thought which reduces all acts to market transaction.
he's austrian right... are there better or worse translators for his books?
His most known and discussed work is "Capitalism, Socialism and Democracy".
IMO the core of his relevance to Startups and economic growth is his early book "The Theory of Economic Development", which he wrote in his mid-20's at the turn of the century... but wasn't translated until 1934.
Drucker puts Schumpeter in context to Keynes: http://druckersociety.at/index.php/peterdruckerhome/texts/mo...
(though keep in mind this essay was written in the early 80s when depressions were nowhere in sight; Keynes has proven pretty relevant)
I'd highly encourage you to read this (very long) interview with him from 2011 in Edge:
Except no, it doesn't work like that. Small changes in DNA can cause disastrous effects in evolution; we only got here because of the small changes that didn't. Each of us has billions of unsung relatives that died in the womb/egg or just outside it, as evolution tried to figure out a way to make us.
And then he proceeds to make up a word -- "phenotropics" -- and state that this is a better way to do software. Of course he doesn't get into what phenotropics actually means specifically because it doesn't mean anything specific. The point is that we in software should stop whatever we're doing and invent it. Because Jaron Lanier said so. It's a half-finished idea, like Louis Savain's Project COSA.
And there's just something subtly wrong like this about a lot of what he says. Even if you can't put your finger on it right away -- you feel it. A collection of Jaron Lanier essays might make a good middle chapter for "The Book" (from Anathem).
I was not aware that instagram manufactured cameras or mass storage devices. Cannon employs 198,307.
But I still see your point. It isn't the best comparison, and using it as a quotation does not bode well for his book, IMO.
The analogue to film would be the hard drive or memory device in the camera on which digital images are stored. So whoever makes those is the new Kodak.
It all fell apart when nobody needed film and everyone (for the most part) stopped printing pictures.
I don't really see instagram as a factor one way or the other. Kodak was dead anyway, at least the "film, paper and chemistry" part.
Their main problem appeared to be both technological and competitive. In the very early stages of digital SLRs Kodak provided sensors to all of the big players, establishing themselves as the go-to OEM for sensor tech.
And then Canon decided to not put the most important component of their camera in someone else's hands, and folded sensor tech into their own company as a core component. This was also the age where Canon was eating Nikon for lunch through superior design and marketing, so Kodak lost not only a large customer, but their remaining ones were being pummeled in the market.
Nikon followed soon afterward, though in the long run they were unable to sustain their own semiconductor R&D and now run primarily Sony sensors.
Kodak went from the go-to OEM for sensor technology to nibbling at the extremely niche sector of scientific equipment photo sensors and rich-surgeon-toy cameras like the Leica M9. It's a sad tale really, and while I'm sure Kodak had many opportunities to avoid their demise, the whole story isn't quite a textbook tale of ridiculously bad management.
Nowadays there are few companies actually building digital sensors. Canon is the big one, Sony is the next big one (which also power Panasonic, Olympus, Nikon, Pentax, and Sony's own cameras). Samsung is the straggler - their OEM business has gone kaput in recent years, but they are still building sensors for their own cameras (which are largely failing in the market). Fuji is the standout in the pack, still making their own sensors despite being comparatively a tiny fish in the pond.
I'm pretty sure that Kodak was one of the cases discussed. If not, it deserved to be because it was a classic example of the perverse incentives that destroy incumbents.
Kodak realized the future. Kodak invented it. But their film business dominated from a revenue perspective. At every point where they had to make a resource allocation decision, the fact that film was the cash cow gave people from that division weight, and nobody in other departments really wanted to kill that sacred cow.
When Canon decided to not depend on Kodak, they were not just doing that because they wanted to be independent, but also because they recognized that Kodak's priorities didn't match theirs. I wouldn't be surprised if the design advantages that Canon had were not there in part because they didn't have any internal politics around protecting a legacy cash cow.
Maybe Kodak's executives should have read it more carefully. Or maybe they did, but it's just a damn hard problem to tackle.
They'd still be selling them if Kodak management hadn't thrown away the chance to move to digital. Kodak research was THE pioneer in digital photography. It got killed because it posed a threat to the film, paper, and chemistry divisions.
To name just one, Apple employs almost 400,000 workers directly, plus god knows how many contract factory workers.
Innovation is not zero-sum.
From a case study at uni I learned that Kodak was never in the 'basic snapshots' business. Kodak was in the 'making memories' business and they marketed to mothers as the chroniclers of the 'family history' (those who would carefully curate and treasure family photo albums).
It was the advent of the casual snapshots that marked the beginning of the demise for Kodak since that was a completely different demographic with different drivers. Kodak failed to see the underlying shift and then couldn't adapt fast enough.
Wow, this is so wrong I am annoyed by it. The Internet is not "anonymous" (it really isn't, for the most part) because someone designed it that way. You can read the design rules set out by DARPA and see that they were concerned about infrastructure above all else [1]. The fundamental goal was the multiplexing of many different networks. The top three secondary goals were:
1. Network resilience 2. Multiple communication types 3. Support for different network types
Anonymity was not part of the design of the Internet--period.
[1] http://ccr.sigcomm.org/archive/1995/jan95/ccr-9501-clark.pdf
Just look at any business that isn't direct from the company and does not really require direct contact with the customer ; those are the ones to worry about.
And sometimes we push it along, I've seen companies work hard to cut the bottom line by automating things, developing on-line materials, and reducing the accessibility from the public, part to cut costs, other to "be more efficient." Those are the ones what one day have worked themselves into obscurity, because what's the different if local person A helps you over the phone or corporate/outsourced person B?
So what do we get left with - outside (cheapest) labor and local direct services (construction, health, entertainment/dining), and creative.
If you think about it its the creative developments over the past couple hundred years that made many of us redundant. We either should look for new opportunities to grow (space colonization/exploration) or break down the mass production industry to make more communities sustainable.
The downside seems to be the loss of durable goods, but other than my car they represent a tiny fraction of my budget and cars are much better now than a even just 20 years ago.
In the US housing, healthcare, and education seem to be what's killing the middle class without those areas we would just say we are in The middle of a huge deflationary period. And printing money can fix deflation.
I think Jaron Lanier is just lost like any of us trying to explain the current present and especially the use of cybernetics in our life. We know that a lot of people were afraid of technology and the changes introduced in our societies (including myself). If you ever read Jacques Ellul, Ivan Illich or even Theodore Kaczynski, you'll see the issues of changing our human societies with the technologies (especially the ones that we cannot control) can be really scary.
It's really difficult to evaluate the positive or negative impact of technologies when you are directly living the change. In the previous book of Jaron Lanier, I think Jaron was still trying to find the balance between the positive and negative side of technologies. Nowadays, he is more into the "sole" negative side...
To go back to the example of Kodak, I'm not sure that's the right example. Especially that Kodak completely overlooked the aspect of film processing for the online market where Fujifilm was ahead with their "minilabs"... even it was a difficult step for Fujifilm, they moved into something profitable on the long-run.
That's not to say that the author doesn't have a point, it's almost certainly true, but Salon should have really had an editor look over this. For crying out loud, he shifts between 14k and 140k employees for Kodak in the article.
How will readers who do not already agree w/ him become convinced?
Because it's getting blatantly obvious for those who are not lucky enough to be part of us, technologist beneficiaries (so over-represented on this site)?
It's true that digital communication has obliterated industries. And that's awesome, because those industries were inefficient, smelly, and slowed us down. Compared to the incredible value we each get by being able to speak to anyone else, anywhere in the world, any time we like - not to mention, the millions of jobs bourne out of the internet - the loss of jobs in these obsolete industries is nothing.
A) It proposes a solution that is already happening on its own. (micropayments for work that enriches the network.) B) It compares apples to oranges. Instagram is not the Kodak of the Internet. C) It misidentifies the cause-effect relationship of phenomenon that happened well before the Internet boom. The reason inequality is so high has very much to do with the winner-take-all society that was in place well before the Internet came to prominence. Libertarian fiscal policy and lax government regulation is mostly to blame.
Take a look at state government employees most of whom are middle class. A major portion of this labor force is involved in managing data. Rough guess ~30000 * 50 states=1500000. Pretty sure its a much bigger number.
Facebook can manage the data of a billion people with 5000 employees.
Not only is this claim entirely unsubstantiated, it's wrong in quite a few ways.
1) In the U.S. we have not had libertarian fiscal policy in the slightest. 2) We have plenty of regulations in most areas. 3) Even if we did lack regulations or have libertarian policy, this couldn't explain the shift that has happened.
A much more compelling and less baseless argument would be one presented by one of my Econ professors Enrico Moretti in his book The New Geography of Jobs. His argument essentially is that the way in which the U.S. economy has shifted away from manufacturing and toward technological innovation has resulted in a declining middle class and an increase in inequality. As globalization has set in, manufacturing has left the U.S. and with it traditional middle class jobs. On the other hand, technology has been booming, creating cities with a huge amount of wealth. So now we're left with poor, has-been cities like Detroit on one hand, and cities like SF on the other.
I suppose you could argue that not imposing huge tariffs and not being incredibly protectionist in order to protect manufacturing jobs is "libertarian". But these sorts of "lax" policies also have support from most economists, and for good reason. So I don't really know what you're arguing for.
We talk about health technology to save 100 billions of dollars or more in cost savings, EHR saving so much cost, etc. But what they don't talk about is these costs are coming at the expense of replacing human work. This is why I think we'll see continual increase of unemployment and underemployment. We moved to the service-based industry where machines can do many of the work.
Farming is a fragile profession? It's been around for thousands of years!
If you are able to live cheaply, and learn a lot doing something risky, you are being anti-fragile.
http://www.youtube.com/watch?feature=player_embedded&v=e...
Having watched the first few minutes of the above, I think he means his "antifragility" to be an attribute of economic and political systems, not of individual jobs or even whole occupations. E.g., he says that, in order for the restaurant business to be at least robust and maybe even antifragile, individual restaurants must be allowed to be fragile. It gets more interesting when he turns to the banking business ...
because reputations can be manufactured like any other kind of lie, that's why.
-bowerbird