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Economy & Business

Commentary: New and improved, tech-savvy Big Brother is watching you

This article first appeared in the St. Louis Beacon, ​May 23, 2011 -  If it weren't already 2011, one might think it was 1984. Listening to the venture capitalists and Web techies who gathered last week at Stanford University to peek around the next curve of the information highway, one would think George Orwell's imagined world was upon us.

In a conference on "Legal Frontiers in the Digital Media," participants described the "gamification of the world" where people build community by building barns together in FarmVille. They explained technology that watches the computer users' eyes and fingers to make searches more effective and eventually to influence the users to click desired product.

They spoke of the advantages of customized searches that provide people the information they want, if not the information they need.

They waxed philosophical, observing that people with smart phones can't sit by themselves and just think like people once did. Instead, people have to be fiddling with their phone 24-7, using it to mediate the world around them.

They foresaw an ever-growing "creator" economy where Facebook will be bigger than Google and where even bigger tech giants will emerge built around an idea that monetizes a single click of the mouse, much as Google monetized the short phrase of a search request.

They ragged on traditional media monopolists and Madison Avenue, saying the latter was always a decade behind Sand Hill Road, the home of Silicon Valley's venture capitalists.

Worse than Madison Avenue, to the eyes of the venture capitalists, were the government regulators who inhibit innovation. It's information startups, not the government, that will solve the problems of the future, they predicted.

"Skype and Facebook have done more good connecting everybody than all of the do-gooders in government," said Tim Draper, founder of the venture capital firm Draper, Fisher, Jurvetson. They are responsible for "some of the best things that have happened to our global society in the history of the world and it didn't come from some government edict."

Other venture capitalist followed up that heady assessment by saying that it was new tech startups that were addressing society's most pressing problems such as war, education and health care. Warfare is nowhere near as violent as it was in World War I, one said. "Ask your dead grandfather."

Draper was a member of a panel of brash venture capitalists who showed no mercy for the lawyers and media executives gathered in the heart of Silicon Valley to discuss the legal frontiers of the "wireless ecosytem."

The one conventional pundit on the panel was Chris O'Brien, a business and technology columnist for the San Jose Mercury News. O'Brien was not as sanguine about the infallibility of the men from Sand Hill Road. He has lived technological change as his paper's staff of 420 has dwindled to 100. He thought that the tech bubble on the stock market was proof that the markets had their own inefficiencies.

But the venture capitalists didn't have much sympathy for O'Brien's predicament or that of other traditional media executive in the room.

Eve Burton, vice president and general counsel for the Hearst Corp., asked plaintively for tips about how traditional media companies such as hers could communicate with tech firms about the importance of the content they had to offer the web.

Draper offered no solace. "Major platform changes make it better for the consumer," he said, but not the traditional media where "the monopolist had end-to-end control" of content.

The venture capitalists delighted in making the lawyers, regulators and media executives shift uncomfortably in their seats.

David J. Blumberg, partner in Blumberg Capital, said that the Sarbanes-Oxley law passed to address scandals like Enron had made it harder for startup companies to go public, which had dampened innovation and sometimes stymied the government's goals.

Without Sarbanes-Oxley, Facebook might have gone public when it was worth $1 billion, he said. Now it is worth $75 billion, with the difference going to the venture capitalists in an "enormous transfer of wealth" to the wealthy.

Blumberg told of a conversation he'd had at Davos, Switzerland with an Arab sheikh and another foreign official. They wanted him to explain the social media in light of the uprisings in the Middle East.

Blumberg asked them if they had children. They did. Then Blumberg asked them if their children listened to them. The answer was that they listened to them when they were young, but when they became teens, they listened to their peers.

That's what the social media is, their peers, Blumberg told them.

The officials persisted. How could they could control social media? they asked. Blumberg shook his head at their lack of understanding of the impossibility of harnessing the internet.

Paul Saffo, a Stanford law professor, said that the producer economy of the first half of the 20th century and the consumer economy of the second half have now been replaced by the "creator economy."

This is an economy where the same person is the producer and the consumer. For example, when people enter terms into a Google search for free they see themselves as the consumers of information. But the search string provides Google with information with which it can produce value -- a lot of value.

Each decade has a key invention that enables the information revolution to proceed at a faster and faster pace, he said. Cheap processors made possible the PC revolution of the '80s and '90s. Cheap lasers made possible the bandwidth needed by the current web. Now cheap sensors are becoming the "eyes, ears and sensory organs asked to manipulate the world." He predicted the next big technological change would be robots.

Saffo polled the audience and found that few played the popular video games World of Warcraft, Guitar Hero or Call of Duty. He told them they should because the games developed skills important for managers. He also promoted FarmVille, saying it was all about community, with people getting together to build virtual barns.

Some comments were positively existential.

People are "uncomfortable to be alone with themselves when they have a (smart) phone," said Chris DeVore, founder of the venture capital firm, Co-op. Instead of just thinking, people are on their phone

"People are always on from before get up until they go to bed," he added. "People are reluctant to look at the world without their device. What does my device think about the world? It's creepy....but happening."

Jon Ziegler, a senior attorney at Microsoft, said that the web search engines determine what information is important. "If it doesn't exist in Google or Bing, it might as well not exist."

The technological advances of the government document leaks also have upset expectations of how the government addresses situations, such as WikiLeaks.

In the past, there were two filters before documents were leaked, said First Amendment lawyer Jennifer Granick. "The person who would leak would think really hard" before leaking and the leak would be to a professional reporter "who would think really hard" before publishing."

With WikiLeaks, the alleged leaker, U.S. Army Pvt. Bradley Manning, could walk off with the equivalent of 18 trucks full of documents stored on CDs marked as if it had Lady Gaga songs. And WikiLeaks could post documents without the review of a professional news organization.

Those two changes could end up making the government more vigilant in policing secret information, the panelists said. That may be one reason that the Obama administration has filed more Espionage Act cases against leakers -- five -- than had been filed in the previous three decades.

David Vigilante, senior vice president at CNN, put it this way. "Information can move in ways it never could before. ....It's as if you woke up tomorrow and there were no more roads and you could drive anywhere."

William H. Freivogel is the director of the School of Journalism at Southern Illinois University Carbondale and a professor at the Paul Simon Public Policy Institute. 

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