Reverse the “Nuance Destruction Machine!”

Techonomy has just published my latest article on our social media disaster, Don’t Swim Against the Tide of “Nuance Destruction”

Social media is “a nuance destruction machine,” as Jeff Bezos concisely put it in his recent widely reported Congressional testimony.

...As long as social media’s financial incentives favor engagement (or “enragement”) over quality, its filtering algorithms will be designed to be favorable to messages of hate and fear. As long as that happens at Internet speed, bolted-on efforts to add back nuance and limit conflict will be futile. We will waste time and resources with little result, and democracy may drown in the undertow.

The article explains a two-part solution:

1. Change the incentives.
2. That will motivate platforms to redesign algorithms to filter for nuance — and against incivility and hate speech.

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To go beyond the brief outline in the article, see this list of Selected Items.

• Especially on #1:  Reverse the Biz Model! -- Undo the Faustian Bargain for Ads and Data
• Especially on #2:  The Augmented Wisdom of Crowds:  Rate the Raters and Weight the Ratings 

Let's build a nuance augmentation machine!

To Regulate Facebook and Google, Turn Users Into Customers

First published in Techonomy, 2/26/19 -- and more timely than ever...

There is a growing consensus that we need to regulate Facebook, Google, and other large internet platforms that harm the public in large part because they are driven by targeted advertising.  The seductive idea that we can enjoy free internet services — if we just view ads and turn over our data — has been recognized to be “the original sin” of the internet.  These companies favor the interests of the advertisers they profit from more than the interests of their billions of users.  They are powerful tools for mass-customized mind-control. Selling their capabilities to the highest bidder threatens not just consumer welfare, but society and democracy.

There is a robust debate emerging about how these companies should be regulated. Many argue for controls on data use and objectionable content on these platforms.  But poorly targeted regulation risks many adverse side-effects – for example abridging legitimate speech, and further entrenching these dominant platforms and impeding innovation by making it too costly for others to compete.

But I believe we need to treat the disease, not just play whack-a-mole with the symptoms. It’s the business model, stupid! It is widely recognized that the root cause of the problem is the extractive, ad-funded, business model that motivates manipulation and surveillance.  The answer is to require these companies to shift to revenue streams that come from their users.  Of course, shifting cold-turkey to a predominantly user-revenue-based model is hard.  But in reality, we have a simple, market-driven, regulatory method that has already proven its success in addressing a similarly challenging problem – forcing automakers to increase the fuel efficiency of the cars they make. Government has for years required staged multi-year increases in Corporate Average Fuel Efficiency. A similar strategy can be applied here.

This market-driven strategy does not mandate how to fix things. It instead mandates a measurable limit on the systems that have been shown to cause harm.  Each service provider can determine on their own how best to achieve that.  Require that X% of the revenue of any consumer data service come from its users rather than advertisers.  Government can monitor their progress, and create a timetable for steadily ratcheting up the percentage.  (This might apply only above some amount of revenues, to limit constraints on small, innovative competitors.)

It is often said of our internet platforms that “if you are not the customer, you are the product.”  This concept may oversimplify, but it is deeply powerful.  With or without detailed regulations on privacy and data use, we need to shift platform incentives by making the user become the customer, increasingly over time.

Realigning incentives for ads and data.  Advertising can provide value to users – if it is targeted and executed in a way that is non-intrusive, relevant, and useful.  The best way to make advertising less extractive of user value is by quantifying a “reverse meter” that gives users credit for their attention and data.  Some services already offer users the option to pay in order to avoid or reduce ads (Spotify is one example).  That makes the user the customer. Both advertisers and the platforms benefit by managing user attention to maximize, rather than optimize for exploitive “engagement.”

What if the mandated user revenue level is not met?  Government could tax away enough ad revenue to meet the target percentage.  That would provide a powerful incentive to address the problem.  In addition, that taxed excess ad revenue could fund mechanisms for oversight and transparency, for developing better solutions, and for remediating disinformation.

Can the platforms really shift to user revenue?  Zuckerberg has been a skeptic, but none of the big platforms has tried seriously.  When the platforms realize they must make this change, they will figure out how, even if it trims their exorbitant margins.

Users increasingly recognize that they must pay for digital services.  A system of reverse metering of ads and data use would be a powerful start.  Existing efforts that hint at the ultimate potential of better models include including crowdfunding, membership models, and cooperatives. Other emerging variations promise to be adaptive to large populations of users with diverse value perceptions and abilities to pay.

A growing focus on customer value would move us back towards leveraging a proven great strength of humanity — the deeply cooperative behavior of traditional markets.

A simple mandate requiring internet platforms to generate a growing percentage of revenue from users will not cure all ills. But it is the simplest way to drive a fundamental shift toward better corporate behavior.

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Coda, 7/24/19:

Since the original publication of this article, this issue has become even more timely, as the FTC and Justice Department begin deep investigation into the Internet giants. 

• There is growing consensus that there is a fundamental problem with the ad- and data-based business model. 
• There is also growing consensus that we must move beyond the narrow theory of antitrust that says there can be no "harm" in a free service that does not raise direct costs to consumers (but does raise indirect costs to them and limits competition). 
• But the targeted strategies for forcing a fundamental shift in business models outlined here are still not widely known or considered. 

For more information see my Open Letter to Influencers Concerned About Facebook and Other Platforms. 

• It primarily focuses on these business model issues and regulatory strategies (including the auto emissions model described here), and how FairPay offers an innovative strategy that has gained recognition for how it can generate user revenue in equitable ways that do not prevent a service like Facebook or Google from being affordable by all, even those with limited ability to pay.
• It also links to a body of work "On the deeper issues of social media and digital democracy." That includes Google-like algorithms for getting smarter about the wisdom of crowds, and structural strategies for regulation based on the specific architecture of the platforms and how power should be modularized (much as smart modularization was applied to regulating the Bell System and enabling the decades of robust innovation we now enjoy.)

Universal Basic Income and a new Economics of Abundance -- "When looms weave by themselves, man's slavery will end"

Universal Basic Income (UBI) has become a hot topic, as noted in a recent NY Times article by Farhad Manjoo.  Confronting the rise of automation and robots, even libertarians and conservatives are warming to the idea of a universal income provided by the government, and some prominent technology VCs have become very interested. What we face is a new economics of abundance, and it will have many pervasive ramifications we can only dimly foresee -- some sooner than we may think.

The roots of this idea go back as far as Aristotle: “When looms weave by them­selves, man's slavery will end.” I read this quote in a 1964 NY Times article on automation, and it helped set the path of my "user-centered" career in technology. I wrote a high school essay taking off on it, extrapolating how it enabled utopias that blended Bellamy's "Looking Backward" and Wells' "Men Like Gods." Of course that was over 50 years ago, and my youthful utopian views were less seasoned with experience and pragmatism, but the core idea I expressed then still stands up:

...This raises the question whether the product of human labor is necessarily limited. The answer is that it most certainly is not. In this century a messiah has arisen -- perhaps Messiac* might be a better name for this role of automation. As Aristotle said, "when looms weave by themselves man' s slavery will end." The looms are now beginning to weave.

...One can easily conceive a giant automated complex, call it Messiac, that can produce nearly unlimited quantities of goods with only the labor of a few operators and repairmen. Similarly, farms can be improved greatly in efficiency by automation and eventually synthetic, mass-producable foods will be developed. Messiac could thus provide all with everything they needed or desired. It would not only eliminate poverty, but also remove all cause for stealing -- it is easier to push a few buttons for something than to steal it. Any individual who did not want to would not even need to work. The necessary labor would be of sufficient interest and lightness that volunteers could handle it. This remaining work would be of a professional nature and as such would have a high degree of interest... Messiac is thus an economic system that is far more utopian than that of the best traditional utopia.

It is timely that UBI is getting attention just as I have embarked on a much narrower and more immediate quest to develop a step toward that economics of abundance, based on some more sophisticated economics. While we undertake the long conversation about UBI, and the first baby steps on this road, there is a little-recognized opportunity for a related change in that direction.

Digital content and services already weave by themselves -- in the sense that they can be infinitely replicated at almost no cost. This has already caused great turmoil in the content industries -- journalism and music have been in crisis, and TV/video is not far behind. Content can be free, but who will work to create it, and how will they be compensated?

In my other blog, I suggest that the answer is in FairPay, a radically new strategy for pricing that adaptively seeks win-win compensation for creating products and services. Since there is no scarcity with digital, there is no invisible hand to allocate scarcity. Instead we need an invisible handshake, an agreement to set prices fairly to sustain creators, based on allocating "share of wallet" (whether hard-earned dollars, or UBI allowances).  FairPay suggests a simple, pragmatic mechanism for balancing power between consumers and creators/producers to agree on an equitable share of wallet.

Check it out. I suggest FairPay will shed light on how we will live soon, and even more so in a future world where all the looms weave by themselves.

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*That was the era where computers had names like UNIVAC (UNIVersal Automatic Computer), ENIAC, and EDSAC.