Reddit Notes & Rewarding Your Users

I was a latecomer to Reddit. I remember taking a quick look at it a few years ago and just not getting it. The self-styled ‘front page of the internet’ just seemed like a mess to me. But before long, I was a regular visitor. I’m not quite sure how and when that happened. But at some stage, it ended up in a head-to-head battle with Facebook for my attention – and Reddit won. Decisively.

These days, the r/Bitcoin sub-reddit is undoubtedly one of the key news sources for everything crypto. Sure, the commentary can be variable – everything from the most valuable, detailed and informed responses to the most puerile and misinformed nonsense that gets amplified in the Reddit echo-chamber. But in the depths of such chaos, the quality (usually) rises to the top. Which is, of course, the point of the voting system. They’ve had their problems in the past with such an inclusive model (“Traffic was never the problem. Everything else was“) but the reality is that the ultimate curation of content by a community of generally like-minded individuals is valuable.

There’s always been a synergy between Reddit and Bitcoin. Partly because there is a significant overlap between the demographics in the user bases. However, the other more subtle attraction is that Reddit has always struggled to raise money by targetting users with advertising content in the usual manner beloved of so many social platforms because of its users are anonymous. Indeed, Reddit were one of the first ‘big’ names to start accepting bitcoin in return for Reddit Gold back in February 2013.

Now with just under 175 million unique visitors a month, Reddit has turned into a powerhouse of content discovery with sub-reddits housing thousands of active communities of like-minded individuals. So when they announced a $50 million fundraising recently and promised to return some of that value to their users, the logic was clear.

The only problem of course is how they could actually do this. In the original blog post announcing the investment, they suggested that the investors in this round would return 10% of their shares back to the community. This idea then evolved into a suggestion that the company might create its own cryptocurrency (backed by 10% of the existing share capital of the business) which would then be shared out amongst the community.

The idea is brilliant. However, perhaps unsurprisingly in retrospect, the heavy current regulatory and legislative framework that underpins the public issue of shares appears to have put the brakes on their good intentions. So new hire Ryan X Charles has now just announced a new plan: the business is planning to issue something that they are calling Reddit Notes. It’s an interesting proposition, although the details still remain scarce. They have to build a conclusive case that proves that whatever they give to users is absolutely 100% not share equity if they want to avoid the risk of serious criminal penalties that tend to follow the illegal public offering of shares. But it looks at this stage as if they are developing something that is far more akin to a customer loyalty reward scheme that will be redeemable within the Reddit ecosystem.

It’s interesting to see both Colored Coins and Sidechains being mentioned as possibilities for delivering what is essentially a decentralised digital asset project. Both options present real potential in crypto-currency – as well as splitting opinions (so what’s new?) – within the community so it’ll be interesting to see which is chosen.

Put simply, the concept of Colored Coins simply means that an additional layer of information is added to certain bitcoins. This gives those coins certain attributes – effectively turning them into tokens which can then represent other assets. So by transferring a fraction of a bitcoin, you can also transfer ownership of the asset.

As for Sidechains, the topic really needs its own post. But in the meantime, check out Richard Gendal Brown’s succinct summary and LinkedIn founder Reid Hoffman’s blog post explaining why was part of the $21 million seed round into Blockstream, the company that are pursuing this idea. A potential game-changer given that it has the intention of significantly extending the functionality of Bitcoin, this has been one of the big stories of the year.

Again – put very simply – you send a bitcoin to a specific address. It remains cryptographically locked there whilst another asset is released for use upon a separate blockchain. At a later stage, this process can be reversed. If all goes according to plan, there are two huge results. Sidechains now encourage innovation to thrive because people will be free to try out ideas without worrying that they might damage Bitcoin’s blockchain. And secondly, it gives such innovations a far higher chance of success, given that these experiments can shelter under the protective wing of Bitcoin secure network.

It’s worth pointing out at this stage that whilst there is a significant optimism around sidechains, the concept remains theoretical until Blockstream delivers the first code in 2015. The Colored Coins technology on the other hand exists today.

I’ll be fascinated to see which way Reddit goes on this. The scene is developing so quickly that more efficient methods may very well arrive in 2015 (it’s worth remembering that Ethereum and Counterparty have only been around for under a year so far, for example). But whatever road they end up on, the experiment will be fascinating. It’s obviously interesting from the viewpoint of the crypto-currency community. But it’s also of much wider interest to anyone who is struggling with the question of how best to reward a community that has developed around your business. Done the right way, I’m a huge fan of tokenisation to incentivise and reward those in a community (see my post on Folding Coin for example) and the choices they make could provide some very valuable lessons for us all.

Given Reddit’s growth trajectory, this project is definitely one of the many key stories to watch in 2015.

 

The Role Of Experts In Modern Society

“If experts are wrong, it’s because they’re experts on an earlier version of the world” (Paul Graham)

Most people agree that the world’s changing but few fully appreciate that the pace of change itself is continually accelerating. But that presents us with a problem. As the world evolves in response to a stream of new discoveries, how can we identify the true experts within society?

As Y-Combinator’s Paul Graham pointed out in an essay a couple of days ago (‘How To Be An Expert In A Changing World’), the title of expert is one that’s most commonly bestowed by others. Others view your work from a distance and judge it to be leading the way. Yet that work is inevitably historical. For others to assess it objectively, the work must have already been carried out. No-one is deemed to become an expert simply because of work that they merely aspire to do.

In the past, this focus on past achievements was fine. The pace of change was slower and it took much longer for the newly-discovered knowledge to filter throughout the rest of society. Experts had time to delve deeply into the details and learn how to apply new developments based on the foundation of past principles.

But what about today?

I think we’re still working this out. It’s easier than ever for individuals to claim to be experts. Similarly, it’s easier to debunk dubious claims given the right motivation to filter through another’s digital detritus. And while social media undoubtedly can build a profile, it can destroy reputations just as swiftly. But even for those who are undoubtedly ‘old-school’ experts, does this mark of expert represent a seal of approval for the duration of their career? Or is it no more than simply another qualification that must be maintained? To use a simple example, if a marketing expert in 2000 hasn’t bothered to learn anything about digital marketing, can he or she still be seen as an expert today?

The key attribute for any modern-day expert, Graham suggests, is flexibility. To lead your field, you must still be willing to listen to those who bring forward unusual ideas that don’t fit your pre-existing conception of how things work. In many ways, being this flexible is counterintuitive. But unless you’re willing to listen and assimilate the new knowledge that is being discovered daily, the reality is that you are increasingly living off past glories. Short-term, ignorance may be sustainable. Long-term, this inflexibility will kill off your career. A form of individual creative disruption, if you like.

No-one can predict the future. So if you want to avoid that inflexibility, it’s worth remembering that many ‘hit-the-ball-out-the-park’ type businesses seemed to be formed around bad ideas at the start, ideas that experts would have laughed at.  For a good example, look no further than the story Fred Wilson tells about missing out on investing in Airbnb back in 2011 (current valuation: $10 billion).

Of course, bad ideas might be just be that. Bad. Or they might simply be bad today because they’ve identified a demand that the market hasn’t quite caught up with yet. That’s why you’ll always hear investors say that they invest in people: the great team with the bad idea will get investment in front of the bad team with the great idea every day of the week. The idea can change. It’s harder to remove the team. And the best people will continue to work away until they’ve found the idea that works.

It seems that if you’re an expert, you’ll be increasingly walking a tightrope. Perhaps you know the most about how the world works in your field, with people across the networks you’ve built up throughout your career helping to highlight new developments to you. If you willingly change direction and go against the grain in your chosen field, the stakes are inevitably higher if you ultimately get things wrong in a world when your every public comment is recorded online.

We’re certainly seeing this play out in the Bitcoin world. There are many well-known and respected individuals who are experts from the pre-Bitcoin era who are struggling to understand what all the fuss is about. Of course, I’m biased in that I’m certain that Bitcoin’s fundamental technological innovation – the creation of a cryptographically secure system of direct value transfer online – will drive the next stage of the evolution of the web. But for those that don’t share this view, whilst they may rail (justifiably at times) against what they perceive to be a lack of expertise among some of the Bitcoin community, it is naive to assume that these experts are somehow automatically experts also in this new corner of a new world. They certainly could become so – but first they must overcome the ‘expertise inertia’.

An example might be Paul Krugman, the American award-winning economist who wrote the infamous “Bitcoin Is Evil” op-ed in the New York Times almost exactly a year ago. Viewed by many as an expert in his field but entirely dismissive of the technology behind Bitcoin, it’s also worth remember that an earlier prediction of his was that “by 2005 or so, it will become clear that the Internet’s impact on the economy has been no greater than the fax machine’s.”

There is no doubt that as time marches on, knowledge is becoming increasingly specialised.

Something else that experts can expect is to be asked to give their opinions. If that question is posed around this time of the year, that often translates into a request for predictions about how the next twelve months will pan out. As I’ve written before, trends do fascinate me (for example, global trends in 2015 and collaborative consumption). But I found myself particularly uncomfortable at being asked to provide a prediction for where Bitcoin will be at this time next year on the panel for the CNN Twitter Live Chat earlier this week.

Part of this may simply be a natural caution (most people tend to overestimate progress in a year but to underestimate progress over the course of ten years). But I applaud Brad Feld’s view on this: he just point-blank refuses to make predictions. He’s far more interested in the longer-term trends and themes than the hot startups. For investors, it’s not an uncommon position to take – take a look at the investment themes for Feld’s VC firm Foundry Group and also at Fred Wilson’s Union Square Ventures, for example.

So when it comes down to all of these big predictions for the year ahead, it’s probably worth taking them all with a healthy pinch of salt. And whilst you try to pursue your particular area of expertise with a permanently open mind, there’s maybe one more thing to learn:-

“Those who have knowledge, don’t predict. Those who predict, don’t have knowledge.” (Lao Tzu)

The Evolution of MOOC’s

When I first heard about Massive Open Online Courses (MOOC’s), it seemed to be an obvious way to upgrade higher education in a digital world. The possibilities were limitless – simply remove the cost and location barriers and watch what happens when you open the doors to anyone with an internet connection.

Depending on whether you believe information wants to be free or not, ‘liberating’ valuable knowledge that’s been cultivated thoughtfully across the years in institutions around the world sounds like a move that can’t be anything other than positive.

As we increasingly expect to find the answer to every question on the web, the decision facing many students about whether or not it is sensible to start a career under a mountain of debt is a far harder one these days – particularly when the current generation can now expect to earn less than their parents ever did. Add to that the fact that people will change jobs more frequently in the future and suddenly some degrees invariably starts to command less value than they did in days gone by.

So I found it interesting to read an article in MIT’s Technology Review this week that argues that MOOC’s are failing to deliver on the promise of revolution that they’d originally promised.

For example, Udacity co-founder Sebastian Thrun stated only a couple of years ago that he believed that only 10 institutions would be responsible for delivering higher eduction in 50 years’ time. But interestingly, he’s now changed Udacity’s direction by choosing to focus on corporate training as opposed to educating the masses.

Critics often point to the fact that the courses have extremely high drop-out rates and question whether the resulting certification is worth it. It’s clear that MOOC’s are experiencing growing pains but the evidence shows that the overall concept itself remains successful (just perhaps in a sightly different way).

The drop-out rate is often no more than a symptom of the fact that with such low barriers to entry lets people window shop in order to try out courses that they could never otherwise risk committing to. Furthermore, it’s unarguable that this type of education is far more flexible. So whilst those who planned to disrupt higher education may not have seen the results that they hoped for, the data is clear that it’s enabled people from a far wider age range than the classic university demographic to start learning.

For example, Coursera‘s data shows that 85% of sign-ups come from those outside university age. So it’s clearly appealing to people who are looking to ‘skill up’ in this modern age. This is both unsurprising and vital given just how many new important subjects exist today that were unheard of only a few years ago when many of the current students were perhaps finishing their formal education (mobile, big data and digital marketing, to name but three). On top of that, Udacity is now focusing on teaching teachers. Logically, helping to distribute knowledge and updates amongst those responsible for teaching others is far more likely to have a valuable multiplier effect.

It’ll be interesting to see where the model goes from here. There are different business models out there but the optimal organisational structure for delivering MOOC’s hasn’t yet been settled upon. We also should remember that technology has not yet started incorporating AI to any serious extent yet. This is an inevitability and perhaps this will be the tipping point. Combine the open access with the sort of adaptive learning that I’ve blogged about before, and you could have something that’s hugely powerful. In the meantime, I thoroughly recommend Charles Hoskinson’s Udemy course (‘Bitcoin or How I Learned To Stop Worrying And Love Crypto‘) if you’re looking for something to get stuck into for free.

The Dangers Of Public Wifi

I wonder how many of us have sat in a public location like a coffee shop and used the public wifi on offer. Stab in the dark, I’d guess it’s north of 90% and that those numbers are getting bigger. Whilst businesses used to be hell-bent on squeezing a few extra pounds out of customers for wifi access, the growth in both mobiles and people’s expectation that connectivity should be provided as a basic service has seen the provision of free wifi become more common.

But with convenience comes danger. A couple of months ago, the risks of simply relying on public networks were clearly highlighted by security firm F-Secure following an experiment that they carried out in London. Using a mobile hotspot device hacked together for the princely sum of £160 (comprising a Raspberry Pi, a battery pack and a wifi aerial, held together with elastic bands), they set up a temporary network in busy locations and sat back to see what would happen.

As random people logged onto their temporary free network, F-Secure could read their passwords (displayed in plain text via the POP3 email protocol) and also view the last 19 or so networks that each had logged into (valuable information if you’re tracking someone down).

There’s more details about the experiment in the document they produced here and a short video:-

We obviously need to think more carefully about the data that we’re leaking across our devices. I consider myself to be fairly tech-savvy but whilst I pay for a VPN service that I use across all my devices in public, I’m as guilty as anyone else of having connected to public wifi occasionally for the sake of convenience. The solution to this problem has to get over two interrelated barriers, namely education and cost. The risks must be clearly understood by the wider public before the majority can justify paying that additional cost.

I suspect the solution is either going to have to come via phone companies who choose to integrate VPN-like protections directly within the devices (challenging in such a competitive business) or from consumer demand (driven by more high-profile security scares no doubt).

An interesting aside: I originally heard of this experiment when it transpired that F-Secure had hidden a clause away in the terms and conditions that people had to accept before accessing their wifi hotspot. The so-called “Herod clause” meant that people were entitled to use the wifi but only if “the recipient agreed to assign their first born child to us for the duration of eternity”.

In case you’re wondering, they didn’t follow through with it:-

“We have yet to enforce our rights under the terms and conditions but, as this is an experiment, we will be returning the children to their parents…..Our legal advisor Mark Deem points out that – while terms and conditions are legally binding – it is contrary to public policy to sell children in return for free services, so the clause would not be enforceable in a court of law.”

The Future Of Bitcoin on CNN

I was delighted to be asked by CNN to be one of the panellists debating the future of Bitcoin this evening via Twitter. Despite the chat overlapping with the livestream of Lawsky’s outline of revisals to New York’s BitLicense, it managed to attract a huge amount of attention around the web.

Whilst I’ve been using Twitter for six years now, it was the first high profile Twitter event that I’ve taken part in. And a pretty full-on hour it was too. Trying to get your answers out whilst responding to others and also scanning the rest of the conversation meant that the time flashed by. And according this report on the debate in CryptoCoinNews, it appears it seemed to be even more chaotic for many of the people who were looking on.

Twitter’s a powerful platform. Ever since it clicked for me that it had nothing to do with everyday mundanities but that it was instead a mainline that led me to all of the key information that I needed (whether I knew that I needed it or not), I’ve been a big fan. To me, the price that you pay for the immediacy of information is the very fact that it can be a bit chaotic. That’s clear if you’ve ever followed trending topics during major breaking news events. Such chaos doesn’t come without certain risks, of course, but the discovery value is clear nonetheless.

Regardless, it was fantastic to be involved. The reality as we are all aware is that the topic can be complex and provoke plenty of strong reactions as any brief glance at the Bitcoin sub-reddit or Bitcoin Talk forum tends to highlight. And even Andreas popped his head in briefly to get involved at one stage:-

So thanks again CNN. I’m pretty certain that this conversation is one that’s going to keep going for many years yet. It’s far from over.

Price Is Not The Key Metric

As the end of the year approaches, there’s been a glut of articles exploring the depressed value of Bitcoin across the web. To be fair, it is one topic that’s never far away from the headlines. Price is inevitably the barometer of success for those who view Bitcoin with varying degrees of distrust and/or misunderstanding and it commands similar attention within the industry also – for example, seven of the top ten stories on CoinDesk in Q3 of this year were about price.

But I don’t think that’s where the focus should be. Just to be clear, I’m not stating that the price has no relevance whatsoever. If you actually sank your life savings into Bitcoin at the height of the market at the turn of the year, you’ve been left with too few pennies to afford that snorkel that you now need to survive underwater, so it matters a great deal. But in the wider scheme of things, I believe that the lower price has been positive for one reason in particular – it’s bought some time to breathe.

Let me explain where I’m going with this. In 2014, we saw far lower levels of price volatility than in 2013. During this year, we’ve watched billion-dollar plus businesses such as Dell and Microsoft accept bitcoins for the first time. But as such global brands have given their seal of approval in a way that was unthinkable less than two years ago, there’s been little impact on the price in general. In fact, if anything, it’s tended to go down when news breaks of adoption by a significant business. The fact that most simply convert their bitcoins to fiat immediately, with this increased supply hitting the market and creating downward price pressure, is no doubt one of the factors.

But the simple fact is this: when you look at the ecosystem, there still remains a huge amount of work to be done to build the companies and organisations that are needed to harness the technology that exists today and to bring it before a mass market. We’ve barely even started – and where the first forays have been made, they have inevitably been focused on disrupting existing models and businesses. If you have even a passing knowledge of the block chain, you’ll understand that this technology is about far more than just money. And as a result, this year in particular, we’ve seen some of the brightest minds on the planet start to really drift towards full-time development of various 2.0 technologies that build upon the foundations that were introduced – lest we forget – only 5 years ago.

Of course, with a rising price, it’s easier to attract more hands to the pump. And as the price ebbs away, some individuals inevitably lose interest. But with each advance, more people’s eyes are opened to the potential that exists. But that is a key point here – we’re talking about potential. If you’re expecting Bitcoin to behave as a fully mature traditional currency with huge exchange volumes at this stage in its development, I suggest that you might be missing the point slightly.

So by removing the pressure of striving to build a business at speed using a developing technology beneath the shadow of a rocketing Bitcoin price, you’re left with a system in which individuals are far less likely to strive for quick wins. A depressed price helps you to build more sustainably for the future by muting that voice in your head that continually whispers that you’d make more money from simply buying bitcoins directly than trying to build a company.

Let’s consider some other metrics. With traditional financial industry heavyweights joining the party and with network recently seeing the highest number of daily transactions ever, you risk misinterpreting what’s going on if you base your view simply on the price.

At its core, Bitcoin is built using open-source software which means that anybody with an interest can get involved. One of the major benefits of this transparency is that you can actually see the explosion in the number of projects that are being worked on all around the world. Combine that with the massive growth in regular meetups, talks and conferences globally – an exponential growth in investment of intellectual capital, if you like, on top of the record VC capital that’s been pumped in during 2014 – and there’s absolutely no doubt in my mind that we’re looking at an ecosystem that’s coming to the end of an incredibly successful and important year in a far stronger position than every before.

As Benjamin Graham famously pointed out, in the short term the market is a voting machine; but in the long term, the market it’s a weighing machine. Don’t mistake a price based on sentiment today with a price driven by the ultimate value of these new businesses over the longer term. As I tweeted a quote from Bernard Lunn earlier today after the recent seven-year ‘overnight’ success of another disruptive financial industry business, peer-to-peer crowdfunding platform Lending Club that just IPO’d for over $1 billion after starting back in 2006:

It’s been a huge year. But it’s far from over yet. Tomorrow I’m hearing that Benjamin Lawsky is likely to announce an outline of updates to the BitLicense regulations (live stream here) after which I’ve been kindly asked by CNN to take part in a Twitter live chat debate on the future of Bitcoin (#bitcoinfuture). There’s no doubt that this conversation’s set to continue for a long time yet to come.

Satoshi’s Songs: Can Bitcoin Save The Music Industry?

The prospect of a decentralised, definitive record of ownership as introduced by Bitcoin (the technology) is something that I find hugely exciting. Does that make me a nerd? Maybe. But if you’re anything like me, on the same day that it dawns on you that this new system gives us the power to exchange value online with someone (human or machine) that we’ve not previously met without being forced to rely on a middleman, the realisation of just how disruptive such a system is likely to be across all industries starts to take hold.

I have a few personal favourites when it comes to targets for disruption but,  without doubt, one is the music industry. To me there’s a particular poetry about blockchain solutions in that industry given the fact that the vast majority of the online world’s first brush with P2P technologies came from Napster or one of its descendants.

I came across a fantastic essay by Spotify’s artist-in-residence DA Wallach in which he sets out a few thoughts for how crypto-currency could revolutionise the music industry. What’s really interesting is that he doesn’t focus on the obvious advantages of the artist-to-fan internet direct distribution model that everyone knows so well. Instead he applies the power of Bitcoin (or more accurately crypto technologies in general, including Ripple) to explain precisely how this new way of thinking could immediately improve the status quo.

The music industry has its own set of problems, exacerbated by a legacy of confusing IP laws, historical land grabs by competing parties and entrenched resistance to technological innovation, as Apple proved when it decided to sneak up on the big labels and eat their pie just over 10 years ago.

In our collective rush to replace those halcyon days of album cover art with the convenience of digital music, we’re left with a confusing mismatch of precisely who contributed to each track. This has happened because the details of those that worked on each song (whether musician, songwriter or studio engineer) are kept on systems (e.g. ROVI and MusicBrainz) that (much like the banking sector) are closed, proprietary and therefore time-consuming for others to interrogate. This fragmentation of information forces digital music companies to spend time cleaning up this data before using it – and use it they must. It also makes it more difficult for musician’s unions to carry out the essential work in tracking their members’ performances.

On top of such opaque systems, the industry has layered the far more complex world of rights. Any single song can generate revenue that needs to be split and transferred to sometimes more than 20 different parties – whether these are the original songwriters, performers, publishing companies, record companies or performing rights organisations or anyone else that someone has chosen to sell their rights on to.

Let’s set aside for a second the argument that some parties will be excluded from this basket of rights in the future as the music industry evolves. Even if they remain, it’s clear that this complexity is a big issue. Look at Spotify’s model. Taking a total royalty pool, it then distributes this according to each song’s popularity on the platform. But as we’ve seen, one song does not equal only one payment.

This system is inefficient. The result is that both artists and industry members are being paid irregularly because of one simple fact: the system is not fit for purpose.

The answer? Let’s look at the blockchain. But instead of thinking about the value that is transferred upon this technology as being simply bitcoins, let’s think about transferring another type of data that’s clearly valuable. And what do we end up with?

A single global record of music data that is decentralised, open-source, global and controlled by no single entity.

On the face of it, this should be the goal for everyone unless their financial return is directly tied to the inefficiency of the existing system. Whilst previous attempts to unify records have failed, this solution is far more valuable for one reason in particular – this technology enables the automatic and guaranteed distribution of funds directly and immediately to the relevant rights holders with the minimum of human intervention (using smart contracts).

For example, one solution would be for every single song to have its own address. Spotify (in this case) would then transfer the sum directly to the address. In turn, the money (bitcoin, XRP, whatever) would then be automatically distributed according to the conditions set in the smart contracts agreed between the rights holders before the music was released.

No more artists waiting to be paid, unsure of their income. No more confusion (or misappropriation) of funds by any other party in the chain. And transparency driving bad actors out of an industry in which there has been a tradition of unfair and one-sided commercial agreements.

There does remain a question around incentivisation. How do you convince closed platforms to open up and release such data? DA suggests that, much in the same way that Bitcoin miners are incentivised to secure the network by competing for the block reward, this global record of music data could work on a model which charges for access. Those charges could then directly reward those that contributed that data in the first place. My instinct is that this model may have certain issues. But it’s beyond doubt that there’s significant value for all once the participants free this information.

DA’s view is that Bitcoin isn’t best suited for this, suggesting that Codius (Ripple’s smart contracts implementation) would be a better choice. But irrespective of the technology chosen, there’s a huge opportunity here. I know of a few crypto-focused music solutions starting to make waves (like Bittunes) and it’s definitely an area to watch in my view.

Take a blank sheet of paper. Would you choose the industry structure that we have today? Or would you instead look to technology that we now have access to? Combine a permanent, transparent public ledger that credits everyone who deserves it, a system that can automate the contractual payments that already been agreed, powered by micro transactions that can occur in real-time and – at the very least – you have a system in which artists have the potential to earn more money by doing exactly the same thing.

Now that, to me, sounds like progress.

Money Comparison: Gold v Fiat v Bitcoin

As the value of the price of the Rouble collapses and the Russian Central Bank raises the interest rate to 17%, it’s worth taking a high level view at some of the basic options out that some people are facing.

The Traits of Money (Ryan Walker)
The Traits of Money (Ryan Walker)

Sometimes a short post is all that’s needed.

Maybe this new fangled nerd money has something going for it after all.

Digital Ethics in a Connected World

The last couple of months have seen high profile figures in technology painting various ominous visions of Artifical Intelligence bringing about the end of humanity. It’s a fascinating topic but I’ve avoided writing anything on it yet as I feel it’s a nuanced topic that deserves a little bit more detail than simply dealing with it in one of my daily blog posts.

Interestingly though. the topic rears its head once again in this video that I watched today by Gerd Leonhard from TEDx Brussels. Gerd’s a renowned futurist who I’ve been following since he released “The Future Of Music“.

The questions that he poses around ethics and morality when it comes to technological advancement are certainly thought-provoking. As the global network of connectivity tightens, technology continues to develop at warp speed. Yet as humans, we are simply incapable of developing at such a pace. No matter how many people we befriend with on social networks, our social tribe (our hardwired connectivity, if you like) still maxes out at 150 people each.

But like it or not, we can’t stop the exponential development in technology that comes with each passing day, as underlying themes start to take hold and amplify each other’s effects – think of the internet, social media, mobile, cloud computing, big data, 3D printing, renewable energy, the Internet of Things, cognitive systems. robotics. the Smart Grid, the connected car, Smart Homes, Next Generation Eduction, Smart Cities, Next Generation Automation, Connected Healthcare, the Sharing Economy, Autonomous Vehicles, the Maker Economy, the Energy Internet and the Logistics Internet.

Now, one question is becoming increasingly important. Every single advance relies on data to progress – and, increasingly, this data will come from you. Do you genuinely believe that you have the necessary power to decide whether or not this information can be used by Google, Uber or anyone else? If the News Feed that Facebook shows to its 1.2 billion users worldwide daily is indeed being controlled by only 15 people (plus a hugely complex algorithm), shouldn’t you at least have the right to investigate the ethics of these individuals? It’s a question that’s already been asked earlier this year and resulted in Facebook apologising for the way in which they carried out psychological experiments on 700,000 users’s News Feeds back in 2012.

As Gerd rightly points out, privacy holds the key to this discussion. But as another 3 billion people come online in the near future, what will the end result be if we have no moral compass which we can use to guide us when it comes to looking at these issues?

The bottom line is this: technology does not have ethics. It is simply a platform that is in a continual state of development. Almost everything that can be digitised or automated will be. This means that the potential for technology to improve our lives is incredible. But if, in short, technology is all about improved efficiency, what on earth is going to happen to the very human characteristics that are not like those of a machine?

Much of the beauty of human creation can be attributed to mistakes, serendipity and chance. Even the simple existence of inefficiency in the form of playfulness has resulted in much of what we know to be human (take art and music as an example). So when asked (if indeed we are given the choice) how far we wish to integrate computing into our bodies in the years to come, do we just passively agree? Or to put it another way, in search of that added efficiency, are we simply going to make our heads more like machines so that machines can more easily read our heads?

The ethics surrounding this digital transformation are fascinating and slightly scary. It’s an easy call to make to let nanobots get injected into your bloodstream to destroy the cholestrol that might otherwise kill you. I suspect that we’ll generally be willing to accept such actions if the direct result of such ‘cooperation’ results in a greater life expectancy. But where do you draw that line? Is choosing an implant in your brain that can instantly access the Knowledge Graph to give you a headstart in your career prospects just as easy a decision to make? How about if those implants becomes standard and an expected requirement before you can apply for a particular job?

Interestingly, the World Future Society has laid down three simple rules when it comes to thinking about AI:-

  1. Humans should not ‘become’ technology.
  2. Humans should not be subject to dominant control by AI entities.
  3. Humans should not fabricate new creatures by augmenting humans or animals.

I agree with Gerd’s point that we can now safely say that the power of our technology has already surpassed the scope of our ethics. We may be heading into a world of abundance, as Peter Diamandis argues, but we are yet to discover the most ethical way of developing such increased efficiencies – in terms of fully representing the truth that results, being fair to all parties and acting for the benefit of all.

I’m a huge proponent of technology. Always have been and always will be. But I think we can do far worse than to take onboard the punchline of the cartoon used in Gerd’s talk:-

“In the end, remember – we weren’t downloaded – we were born”

 

How Much Does Your Car Know About You?

A week ago I wrote about the Future of Digital presentation on Business Insider. One of the trends that stood out to me is the projected growth in connected cars (i.e. cars with internet access). With predictions that the global market will grow threefold within five years, I believe that it’s going to be an interesting area if only for the simple reason that many technophobes still buy new cars – and will therefore get exposed to the technology, whether they like it or not.

Revenue Forecast for Connected Cars
Revenue Forecast for Connected Cars

However, as Forbes recently pointed out, the introduction of these cars will have to get over some significant obstacles first:-

  • The development cycle for new cars is significantly longer than normal consumer electronics products (such as mobiles)
  • With mandatory eCall systems embedded within cars in Europe that automatically send details of any accidents to emergency services, a controversy has already developed around whether the technology can be used by others to track locations without consent.
  • Car dealers will need to up their tech skills to sell the benefits of the vehicles effectively (and honestly).
  • It’s not clear whether the cars themselves will have inbuilt systems or simply rely on tethering via the driver’s mobile.
  • Car purchases usually involve just one payment. Now consumers have to get used to recurring payments for connected services post-purchase.
  • How high will the hurdles be to getting apps in expensive hardware accepted that address quality and driving safety standards?

Despite all of the obvious benefits, as with all significant advances in technology, there are serious privacy considerations to be addressed as the car becomes your best friend. According to the British Insurance Brokers’ Association, some 300,000 cars in the UK are already using telematics devices that capture details of our driving behaviour (such as the speed with which you take corners). And the payoff for letting someone else keep an eye on you? Reduced insurance premiums.

When it comes to tracking, we’ve already seen issues, even at this early stage. A couple of years ago, TomTom faced a backlash when it sold SatNav data to the Dutch police that helped them to place speed traps. Google’s acquisition Waze announced it was trading user data with local governments, passing across the incredibly accurate second-by-second location tracking that it gets from pinging each user’s mobile phone every second in return for updates from each city’s traffic systems. The information is of course supposed to be anonymous in this case.

In recent weeks, two US-based organisations that represent some of the world’s biggest car manufacturers have unveiled an agreement on privacy standards for securing the data that the connected cars will generate. You can check out the principles here. Interestingly, initial commentary views them as falling short of what would be required in Europe were they to apply across the Atlantic.

There’s no doubt that we can look forward to yet another battle to find a balance between valuable consumer products and privacy in the near future.