The age of internet empires
Posted
The internet is no longer the free, innovative market people still imagine: private giants like Google, Apple, Amazon and Facebook have taken over, writes Xavier Rizos.
As 2013 draws to a close, 'data' and 'privacy' issues are clearly at the front of the public mind: from the year-long teaser about Google Glass preparing us to upload more information to the cloud, to Edward Snowden's revelations about the NSA spying program telling us why we shouldn't.
There is, however, a less obvious yet more defining systemic trend in technology: the fact that the experiment of a free internet designed by hackers and tinkerers has now come to a new age, an age of privatised empires, with significant geo-strategic consequences for those who will fail to understand this shift.
In Australia, for instance, this is the defining reason to build a National Broadband Network (NBN) that will allow domestic champions to emerge and defend our 'national interest' in this cyber era.
Barbarians at the gates
The internet took off there nearly 20 years ago with the wide dissemination of Netscape, the first web browser. Among the founding myths of this new economy was the belief that it would do away with intermediaries placing buyers and sellers face to face. Far from disappearing, new overpowerful intermediaries have actually emerged.
The likes of Google, Apple, Amazon, and Facebook are causing a real creative destruction, in the way articulated by the economist Joseph Schumpeter - a process which redefines trade, modes of distribution, balance of power, and the way value is distributed. This is a puzzle for policy makers and traditional incumbent businesses all around the world.
For two decades, the internet has been profoundly changing the economy. And this is only a beginning. In G20 countries, the heart of the digital economy, operated by information and communications technology (ICT) organisations, is about 5 per cent of GDP. But the digitisation of the economy now affects a much larger number of sectors: for instance the French have calculated that three quarters of their national production is affected.
This penetration is accomplished in two ways: firstly, by realising large productivity gains through the inherent efficiency of ICTs: across sectors, businesses have become more efficient thanks to electronic orders and billing, by monitoring their production; secondly, by a significant dematerialisation of most of the value chain: entire parts become redundant because of digital processes. Just think that today you can book a flight and check-in from your mobile phone, making the role of travel agents totally redundant. In turn, advertising, tourism and the cultural industries have seen their business model deeply challenged by this digitisation.
For each sector that the digital world "cannibalises", the modus operandi is similar: 'barbarians' from the internet enter the value chain at a strategic point in direct contact with the consumers, and use the data they collect from regular and systematic monitoring of people's activities to gain market share and cause a gradual transfer of the margin in their favour.
This is exactly what Amazon did through the power of its recommendation system built from a detailed analysis of the behaviour of its users, and a very aggressive pricing policy. This distributor shipping books from warehouses has become hegemonic in the sale of cultural products, with the spectacular consequence of putting out of business a plethora of brick and mortar players, from the small bookshop at the corner of the street, to the giant Borders that filed for bankruptcy in the US in 2011 after its 500 stores and 20,000 employees lost the battle against online distribution.
The same happened with Apple. The couple formed by the iPod music player and the iTunes software has created a direct relationship with customers (and their bank details!). The company now dominates the online music market (two thirds in the US), to the point of having succeeded in imposing to record labels the prices at which they sell their songs. With the success of the iPhone and iPad, Apple is on the way to extend this rule to other producers of content, whether video or the press.
So, far from having materialised the ideal of a pure market allowing perfect competition - as its pioneers believed – the internet has instead given birth to a juxtaposition of giant monopolies in separate market segments, which are often not in competition or only indirectly.
A winner takes all world
If the digital world tolerates so little of the competition, it is because of a specific law of its own: the network effect. The value of a good or service increases with the number of its users, even at the expense of short-term profitability: the product is adopted by a critical mass of users, allowing a company to acquire a dominant position on a given market. This delivers a "winner takes all" outcome.
This is how Google has ended up dominating search, Facebook social network, YouTube video streaming, Apple online music, and Amazon e-retail.
Amazon is a fascinating case because it provides insights on how organisations achieve this. To establish its domination, the e-retailer spent nearly $3 billion between 1995 and 2003, mostly funded from its own cash-flow, before becoming profitable. Therefore, if the internet is dominated by US giants, it is not only because of the innovative spirit of the Silicon Valley they often come from, but also through unique financing facilities they benefit from. Since 1998, US venture-capital firms have funded on average one digital start-up every three months the value of which has subsequently exceeded $1 billion.
Faced with the consolidation of these monopolies, authorities responsible for enforcing competition often remained impotent. The weapon normally used by government are taxes, but they prove difficult to collect in the face of cross-border optimisation techniques deployed by those businesses. The problem also goes beyond the issue of "tax evasion". It is illustrative of a disconnect between a 'traditional' regulation applied to business models it was not designed for. Those Tech giants have established their domination though services that are often free for users: Google's search engine is free, so is Apple iTunes or the Facebook social networking software. They don't generate direct revenues. Instead, those companies derive value in other ways, thanks to the data they collect, which allows them to sell advertising like Google and Facebook, or to become exclusive sellers of content on a locked proprietary system like Apple.
This complexity of supply underpinned by constantly evolving business models, which combine software, online services and new hardware, and which is always changing due to innovation, condemns the regulator to always be several steps behind. For example, it is only 12 years after Microsoft Internet Explorer killed its rival Netscape that the European Commission has obtained that the browser no longer be installed by default on all computers running the operating system!
The insight is that in the last decade, the internet has shifted from the free innovative market people still imagine towards a juxtaposition of private empires, a situation that represents a systemic risk at a time where the number and scale of services we use from the online world has created critical dependencies.
The geostrategic stakes of the cyber age are often compared to nuclear weaponry during the cold war. Nations and businesses that find themselves relegated at the periphery of those new empires now need to operate all the levers they have - competition regulation, taxation, industrial policy, investment strategies - to preserve their chances to benefit from the next digital wave that will come with the Internet of Things, Big Data and Artificial Intelligence.
Xavier Rizos researches relationships between economics, governance, regulation, politics and culture. View his full profile here.
Topics: internet-technology, internet-culture
Comments (59)
Comments for this story are closed, but you can still have your say.
carbon-based lifeform:
20 Dec 2013 9:43:50am
It's hardly surprising that this has happened.
Of course people will buy books and music from the internet sellers.
Especially when we in Australia are treated like second class citizens by the music and book industry. In the past, we had to rely on specialty import record shops to buy material from artists that the Australian record industry decided that it wasn't economic to import.
Then Internet stores came and, bingo! we could buy records (CDs by now) that were impossible to buy from stores because they weren't on the local catalogues.
While I'm sorry about the demise of local bookstores and music retailers, but they can only blame the ones that decided what people should like.
Alert moderator
Lehan Ramsay:
20 Dec 2013 10:21:45am
It sounds like more of a human pattern than that.
Alert moderator
RayS:
20 Dec 2013 11:01:35am
Let's not forget eBay and other person to person trade enablers. New and second hand goods of unlimited types bought and sold without involving a middle man, although eBay's credit provider Paypal seeks to take a margin from the trades. I find eBay a very good utility, which has gained dominance in its field but still has numerous competitors.
Alert moderator
Back catalogue please:
20 Dec 2013 9:54:35am
One of the most insightful posts anywhere on the Net this year.
Alert moderator
Factsheet:
20 Dec 2013 10:18:50am
There is nothing interesting on the internet anyway. That's why money is necessary, at least to make it interesting for micro macro crawlies. They retire to the nearest a-conned bar, pay $400 of con for a Chivas Regal in chinaware, and laugh & chortle at their shallow customers, who pay for advertising for even more useless products.
Alert moderator
mum of 4:
20 Dec 2013 1:34:50pm
Nothing interesting on the internet? Seriously? The whole world is at your fingertips and you can find nohing interesting?
Alert moderator
arf:
20 Dec 2013 4:12:30pm
There are some who think that money is the only thing of interest. They find it incomprehensible that some do not agree
Alert moderator
JohnM:
20 Dec 2013 10:28:36am
It seems that Rizos is upset by the fact the Internet is a "disruptive technology". In reality there's nothing to stop anyone creating some killer Internet app and making money from it.
As for the companies that he names, sure they are big but they got they way because they provide what the customers want.
Speaking personally:
Google - very good search tool, especially the Advanced Search
Apple - never use its product because Apple is even more "closed shop" than Microsoft
Amazon - use it rarely, I prefer Australian book sources if I can find them
Facebook - never felt the need to show-off to the rest of the world
... which is all to say that among these only Google plays a significant part of my online life.
Alert moderator
Ron of the valley:
20 Dec 2013 10:59:20am
I agree.
Will never use Apple or Windows, and do not use Facebook or Amazon.
I do use Google, but with a browser without javascript there is not a lot of information that Google can harvest.
Especially with a range of interchangeable agent IDs.
Alert moderator
Brian:
20 Dec 2013 11:47:19am
You're kidding yourself - read up more on how they track you. No JS may reduce your footprint but they've still got your network address, ISP, location, OS/browser combo, plugins, cookies, logons and more. Using Linux actually makes you easier to find because you stand out in the crowd. On the other hand, it IS like physical security - you're never actually safe, you're just making things hard enough that hopefully crooks move onto easier targets.
Alert moderator
Mike:
20 Dec 2013 12:24:42pm
There are free browser plugins which will block all of that whatever OS you are using.
Ditto advertising. I haven't seen a banner ad for years.
Alert moderator
Brian:
20 Dec 2013 3:41:04pm
Not true. The network needs your address to return your page; the browser needs your session to keep a connection open, cookies to maintain your preferences, plugins to deliver the correct content, etc.
Alert moderator
Aria:
20 Dec 2013 5:04:35pm
Different adversaries need different countermeasures. A plugin might take care of fingerprinting, but Tor or similar would take care of the IP issue.
Alert moderator
Heretic:
20 Dec 2013 4:35:05pm
There are several free tools out there, if you're concerned about privacy. You might start with Start Page which doesn't store your IP address, etc.
Alert moderator
Richard Tait:
20 Dec 2013 11:26:40am
Well it would be great if people could just make killer apps and start like that. But it is not so easy - you need to have technological know-how and be computer literate to a very high degree.
The internet is still a great tool but one that should be used in moderation.
Alert moderator
Dean:
20 Dec 2013 12:16:03pm
As was pointed out, the thing stopping "anyone creating some killer internet app" is venture capital needed to start an 8 year loss leader.
Obviously these companies provide what people want and other businesses need to adapt to survive. The problem is that before it became easy to record and interpret significant amounts of data there was a lot of cross subsidisation within businesses. Companies like Amazon only take the easy customers who do not need personal service so "bricks and mortar" stores don't have 5 easy customers purchases to help fund the one person who needs assistance. This will split retail from service and advice. Unfortunately this will place advice out of reach of those who need it most.
Alert moderator
Heretic:
20 Dec 2013 4:42:26pm
Dean, you can read product reviews on pretty much anything you can purchase online.
Alert moderator
Dean:
20 Dec 2013 7:13:39pm
The people I am referring to probably don't read The Drum. As a pharmacist, an obvious example I could give would be those struggling to understand their medications, although I am regularly asked about non pharmacy products.
The reason I felt compelled to comment here is that earlier in the week I was asked by a customer to recommend a book for her to buy for her 2 year old granddaughter for Christmas. This customer, like many more than you would think, is barely literate and lacking both the confidence and knowledge required to choose a book for a 2 year old. In a bookstore, she could have asked a staff member, avoiding the shame of acknowledging her inability to do this simple task for her grandchild. I did check a few reviews online, as you suggested, and printed an image of the cover for her so she could go and find it.
Another customer (jokingly, I promise... some methadone patients have a warped sense of humour) has suggested that to get the best toys for your kids you just need to find a rich family with a kid the same age and...
I am not suggesting that we should be protecting old businesses or out dated business models, but we do need to understand what they actually do (not just sell stuff) so that we can anticipate unmet needs arising from their closure.
Alert moderator
Brian B:
20 Dec 2013 2:52:33pm
So you feel qualified to comment on Apple and Facebook - but you have not used them?
Alert moderator
GrumpyOldMan:
20 Dec 2013 2:57:23pm
" which is all to say that among these only Google plays a significant part of my online life."
Yeah, we know JohnM! You get all your 'facts' from Google too!
Alert moderator
Maybe:
20 Dec 2013 3:55:47pm
Google doesn't propose to have "facts"
It is just search.
When researching in a traditional library one still need cross evaluation and critical thinking to sort information from opinion from nonsense.
When somebody says they know something because they googled it, they are not claiming and absolute in correctness or the opposite.
They are merely identifying the address of the library they used, not the authenticity of it's content.
Alert moderator
Brian:
20 Dec 2013 10:52:03am
'Download This', RN . . .yesterday had an interesting take on this. (download the podcast)
Basically, the Snowden revelations has spooked a lot of businesses, who are now going beyond basic firewall security and heavily into encryption tech . . .looks like 4 to 5 levels, and an aversion to the big players software ie Microsoft. The feeling is that if friendlies can do this, than what are the baddies able to do?
There may be s fundamental shift in the wind.
Personally, outside of Google . . .Ive drastically cut back on my digital footprint in the past 2 years.
Alert moderator
Ron of the valley:
20 Dec 2013 10:53:40am
One doesn't HAVE to deal only with the giants.
And one doesn't HAVE to bare our souls and bank details to see, watch or download from the internet.
I do NOT use Microsoft Windows, I have nothing made by Apple, and I do NOT do my banking through the internet.
But I do run and maintain two domains. So I run my own email servers.
And I am perfectly capable to buy and pay for whatever I need on the WWW.
The secret ?
DOS and Linux.
C'mon people, it is not hard.
Alert moderator
Aria:
20 Dec 2013 1:34:13pm
A common mindset among average computer users is for technology to "just work" - the issue of monopolies in tech is quite a low-flying issue.
Without stronger motivation (currently lacking, given the popularity of Google, etc), no Linux switch will occur - let alone DOS.
And as a side note, it's interesting that being able to run your own mail server depends entirely on the Internet, at its core, remaining standardised and open. If the large email providers decided to switch to their own proprietary replacement for SMTP, little home mail servers would die pretty quick (already, I believe it's quite common for personal mail servers to be blocked by overzealous spam filters).
Alert moderator
Ron of the valley:
20 Dec 2013 2:37:15pm
FYI: Both Linux and DOS handle Google just fine.
> And as a side note, it's interesting that being able to run your own mail server depends entirely on the Internet, at its core, remaining standardised and open.
The email protocols are not controlled by the "free" email providers.
> If the large email providers decided to switch to their own proprietary replacement for SMTP, little home mail servers would die pretty quick.
The protocols for email (POP3, SMTP, IMAP, etc) are freely available for all to use. I am sure that some of the large providers would like to control such things, but they don't.
OTOH: This may well be a risk for users of "walled garden" operating systems.
Alert moderator
Aria:
20 Dec 2013 3:15:03pm
"FYI: Both Linux and DOS handle Google just fine."
I am aware of that (I use Debian, if you're curious). Then again, the operating system doesn't really affect the compatibility of websites much, one's choice of web browser does.
"The email protocols are not controlled by the "free" email providers...
The protocols for email (POP3, SMTP, IMAP, etc) are freely available for all to use. I am sure that some of the large providers would like to control such things, but they don't.
OTOH: This may well be a risk for users of "walled garden" operating systems."
That is of course true. A protocol can be used by anyone - it's just that other people need to use it, or there's no point in your using it. The fact that sending email has standardised upon SMTP is a big plus, because there are multiple players in the email market at least and there would be no sense in not being compatible with other providers.
In contrast, take instant messaging, which has an open standard (XMPP) but instead is a fragmented playground of various providers all with their pet protocols (Skype, ICQ, etc). These "islands" of IM systems are all self-sufficient enough that there seems to be little incentive to federate.
Whilst the operating system has little theoretically to do with the implementation of protocols at application level, I do agree with the idea that if one is to break out of the walled garden, it's better to break out of it entirely.
Alert moderator
Brian:
20 Dec 2013 3:46:33pm
The big boys have been promoting improved protocols with better security and encryption for many years. It's not about control so much as evolution, old/basic mail servers may not be able to handle new formats.
Alert moderator
Aria:
20 Dec 2013 5:01:14pm
It's both - users get a possibly false sense of security, and the company gets more control.
Email doesn't need new genius ideas about protection. OpenPGP has been around for years.
Alert moderator
GrumpyOldMan:
20 Dec 2013 2:46:19pm
"DOS and Linux. C'mon people, it is not hard." Really?
Do you realise you have just eliminated the vast majority of people on this planet from the benefits of running a business on the Internet?
This techno-elitism has been a constant madness that has fragmented the IT industry for decades and frustrated the hell out of all 'ordinary people'. If you want to waste your time figuring out how to some simple task in DOS or Linux, or fiddling with the hardware or software inside your smartphone or tablet, building your own smartphone from scratch, or writing your own operating system, then go ahead and waste your time.
But don't expect the other 95 or 98% of people on the planet to be so stupid as to waste their time too. They have REAL work to do, and they need the easiest possible way of doing it. That is why Apple is SO successful, and the likes of Microsoft and Google just can't keep up.
Alert moderator
Ron of the valley:
20 Dec 2013 3:12:00pm
Hi Grumpy. :)
No, I don't expect everyone to give up their Windows and Apples.
In fact, I encourage all to stay with what they are using.
.
.
.
.
.
.
So they can draw the fire away from us geeks.
FWIW: I run a business on the net.
And, I am pulling your leg. :)
Alert moderator
Aria:
20 Dec 2013 3:23:01pm
Whilst Linux (I cannot speak for DOS) certainly has a reputation for being elitist and geek-oriented, systems based on it have a wide range of intended audiences. Generalisations like suggesting that using Linux is equivalent to "writing your own operating system" are not correct.
Also, I strongly call into question your assertion that Apple is somehow enormously more successful than Google and Microsoft.
Please, let's not make this thread turn into yet another iPhone vs. Android vs Windows vs <insert pet technology> rant.
Alert moderator
GrumpyOldMan:
20 Dec 2013 4:58:44pm
Aria, as a 40+ year veteran of the IT industry who has seen a lot of what has gone on in the industry, I am trying to make the point that the IT industry is not just for Linux geeks like you. It is for ALL people, young and old, and the vast majority of those people couldn't care less about the hardware and software.
They just want their computing devices to work reliably and intuitively, and not to have to first do a computer course, or read unintelligible manuals, or have to call a technician every other week to defrag the hard drive or install virus software or firewalls, or get rid of the odd virus or other malware.
Why is that so difficult for geeks to understand? The old KISS principle is sadly beyond most IT people!
Alert moderator
Aria:
20 Dec 2013 6:13:15pm
Great. I make a soft point about a generalisation you stated and that makes me a Linux geek who doesn't care about ordinary users.
And ironically, I will note that a properly configured modern Linux distribution needs not defragmentation, nor virus scrubbing, nor firewall installation, nor reading unintelligible manuals. Usability of Linux is a spectrum, as I said.
Alert moderator
GrumpyOldMan:
20 Dec 2013 7:08:37pm
Aria, my comments are not directed at you personally. They apply to the IT industry in general. The IT industry has been fervently anti-Apple for 30 years. And that is reflected in many of the uninformed comments on this thread. It is high time the IT industry got over its irrational prejudices against Apple, rather than criticizing me for stating the bleeding obvious about the poor attitudes of many in the industry towards non-technical 'users' (particularly when that word is spoken with disdain).
And, by the way, the most usable and secure version of Unix on the planet is surely Mac OS X, not one of the many different Linux distributions?
Alert moderator
Brian:
20 Dec 2013 11:12:01am
Rizos seems to miss a key point, which is that all of these companies have emerged and consolidated over a very short period. And in an environment with very low barriers, we've been able to watch capitalist theory play out in very short order. But there's hope here too, because each became dominant by disrupting their own sector, and lives in fear of another company doing the same to them. And now they're middlemen, they're in the most vulnerable position on the internet.
Alert moderator
peterottaway:
20 Dec 2013 11:18:02am
I would like an explanation as to why Apple is always included in these stories. It seems too much like just another cut and paste job to me.
Just like the continuing mindless ranting about Apple being a closed shop. The Applephobes have some sort of belief if they scream it out time and time again then somehow it become true.
Alert moderator
Werdan Blot:
20 Dec 2013 11:53:28am
Name a computer other than Apple that runs a Mac OS?
Alert moderator
arf:
20 Dec 2013 4:19:44pm
The Commodore Amiga used to be able to run MacOS. (Just sayin';-)
Alert moderator
Applaudanum:
20 Dec 2013 6:23:45pm
I can't answer that, but I run XP on my Mac. I also run a Commodore64 on my Mac, but that's just how 8-bit tragics get their kicks.
Alert moderator
GJA:
20 Dec 2013 6:15:27pm
You've heard of iTunes, at least, yes?
Alert moderator
Church the Taxes:
20 Dec 2013 6:32:01pm
I have. Hate it.
Any tips on getting the songs that I PAID FOR away from iTunes, to play in my car or other computers?
Alert moderator
Nothing To See Here:
20 Dec 2013 7:15:39pm
Funnily enough .... using i tunes allows you to burn songs to cd.... for use in normal cd players.
Using free cd " ripping " software allows you to create ...mp3...flac ...whatever.
Tedious but......
Alert moderator
stephen:
20 Dec 2013 7:18:23pm
Download them to a CD on your laptop.
Voila !
Alert moderator
Chris of Syd:
20 Dec 2013 11:27:58am
It's hard for me to not see these companies as heroes.. do they want information about my boring personal life? yes.
Do they give me amazing services? Yes.
Imagine life with no Gmail, Gchat, Google Maps, Google navigation, no android, no google docs... it would be like a time machine.
Then Amazon. I just bought a monitor for $280 on amazon, it should be here soon after Christmas.
RRP for that monitor in ALL Australian shops, online and off? $499.
The Kindle is also amazing. taking my library with me on the train on a device that fits into my pocket is brilliant. No more bulky bookshelves taking up storage space at home, no more trees being turned into books.
I cannot see a downside, there is nothing stopping Australian businesses from competing besides the GST.
10% tax vs. international shipping costs? How can they not compete.
Alert moderator
blax5:
20 Dec 2013 12:38:46pm
Not sure that you are fair here. In the US the minimum wage is approximately $ 7.50 and taxpayers pay wage subsidies in the form of foodstamps. Last time I looked it was 15 % of the population that was on such low wages that they needed foodstamps. If we were to compete with their prices we'd have to reduce wages significantly but then prlop them up, unless you advocate they either don't eat or you'd put them all in dormitories with full board.
The US and others also have more of an economy of scale; 1,000 imported/manufactured items have a higher unit price than 10,000.
My book would not exist without amazon, and when I looked into Australian distribution, it was not viable, so it's still only available on several amazon channels. I know there's a contradiction here, but I am unable to reconcile it.
Alert moderator
Gauis.Marius:
20 Dec 2013 11:44:33am
Things missed here:
(1) these companies profit because they simplify complex processes. Web and programming code is difficult to use. Programs like Facebook serve as a one stop shop for people to communicate easily. Once an efficient medium is found, nobody wants to go elsewhere for the sake of creating market competition.
(2) The monopoly of these companies is limited by the occurrence of new innovations and market change - MySpace was once the largest social media network, but it fell due to its inability to innovate and compete with new social media platforms like Facebook. This, along with the market volatility of these new mediums limits their power.
Alert moderator
UnKnown:
20 Dec 2013 6:19:52pm
Now the parents are on facebook, it is on it's way down.
Alert moderator
struck dumb:
20 Dec 2013 12:39:55pm
I certainly could not live without Google, and Amazon. Facebook is a necessary evil but there are ways around its intrusive habits and if the people I keep in contact there were not so committed to the site, I would not have to use it. I have no use for Apple products, and would prefer to do without Windows, but old habits die hard, so I use a browser with as many security settings as I can control that still gives me the option of enabling java etc, if I want to.
The only contacts list that anyone can steal contains a list of spammers, I do not keep financial details on my computer and definitely no passwords that can give access to my accounts. Paypal does not have my bank account details, only a card number, so its easy to control, and it is possible to get your bank to refuse all requests for money from them.
It takes a bit of extra work to set up, but when you think of the amount of information that regular bricks and mortar organisations have about you, and the opportunities to be scammed at ATM's and checkouts because the banking service has a glitch, let alone the scammers who can tamper with them, and the people who happily mug you as you leave an ATM, what is the greater risk? The only time I have been hacked was when I purchased something from a company in a bricks and mortar store, paid using plastic, and that company later had its database hacked!
Nearly everything we do, whether in the real world or the virtual world, is trackable and can put our personal security at risk and betray our personal habits. Its up to us to weigh up the consequences of dealing with the large internet companies and taking precautions. Its not perfect, but what we should really worry about is the amount of information held by governments, banks and utilities. If they are hacked, then we can be seriously in the smelly stuff!
Alert moderator
GJA:
20 Dec 2013 6:18:01pm
Facebook is in no way "necessary", and Google, among others, approaches a kind of monopoly status that would have had many people at one time aghast. We need to accord such companies exactly the kind of scrutiny we once gave Standard Oil et al.
Alert moderator
stephen:
20 Dec 2013 6:40:35pm
That you may get 'hacked', amusingly, reeks of self-importance : sorry to be so cynical, but who the hell do you think you are - and the rest of you - to feel that someone not on your love-list may know something about you which you may not fully approve - and has this not always been the case, irrespective of the times in which we live ? - that the benefits of what we can know is servient to your oozing gossips ?
Get real ... or go away.
Alert moderator
South of Saturn:
20 Dec 2013 1:09:07pm
seems to me the gist of Adam Smith was that some markets tend to be monopolistic and if so, governement needs to ensure there is some regulation so that ordinary citizens do not get gouged.
this is based on the fact that markets do not occur naturally; they need human input to become coherent...e.g. felines do not have markets. ("markets" vis a vis Economics equals formal mathematical construction)
this is not to say that markets do not have naturalistic tendencies, they are after all staffed by naturally occurring humans. it's just that over time an over emphasis on the purely mathematical (dialogic) can come to usurp the purely physical (biologic). this overemphasis on the virtuality of 'mathematics' over the reality of 'physics' can lead to non-naturalistic outcomes hence, in Adam Smith's argument, the need for enlightened (knowledgable, wise) legislative decision making, even making some monopolies publicly (not state) controlled.
...all we're really waiting for is a more socially responsible model of business to evolve...
Alert moderator
Radical Transparency:
20 Dec 2013 3:57:54pm
Xavier, you forgot pay-pal / e-bay and bit coin.
Curious thought that stems from the 1990's when outsourcing became the new black. A bank in Australia decided they wanted to outsource their IT department, that is until someone pointed out that they were thier IT department. Lesson: you don't outsource core business.
So following from this, part of the core business of a nation state is it's currency. And yet we slowly allowing the privatisation by stealth of our currency to privately held corporations.
It started with AMEX, Visa, Mastercard but now we also have Paypal and Bit Coin.
And we're completely helpless in this. It's just happening, without anyone voting for it, without it even being disussed.
Alert moderator
Aria:
20 Dec 2013 5:08:22pm
Sorry, but that is not a correct assessment of bitcoin. There is no central authority in that currency system.
Alert moderator
Tax the churches:
20 Dec 2013 5:41:00pm
Judging by the few responses to this excellent article, makes me wonder if Australians just tend to sit back (as usual), expecting that someone else will do "something".
Well, dream on pizza munchers...
Sometime ago, I received an invitation by a friend via Facebook. After responding I found that Facebook stole my email contacts, sending out unauthorized invitations to friends, plumber, real estate agents, etc. purportedly on my behalf.
Suffice to say, Facebook remains permanently ignored at my home, probably forever.
Google are not far behind having designed "gmail" in a way that prompts for pictures, phone numbers of self and contacts represent an ongoing chore to navigate and avoid.
When it comes to Amazon, etc. someone else may care to comment in-between two slices of pizza?
Remember, unhealthy lifestyle will not protect your privacy.
Alert moderator
struck dumb:
20 Dec 2013 6:49:07pm
There are very simple ways to protect ourselves from the worst of the internet data gathering.
Firstly, if using Windows, use Firefox and Thunderbird as browser and email client. They are simple to use, faster than their Microsoft cousins, and have some good add-ons that increase security, and Facebook, Gmail etc cannot read your contacts list. They don't even recognise you have one!
Secondly, make sure your internet security suite recognises your email program and automatically scans your email in and out.
Thirdly do not rely on your internet suite to catch all the web nasties, because it won't. Malwarebytes anti-malware (free) and Spybot (also free) will catch the ones your security suite misses.
Fourth, if you have to do Facebook, run Facebook Purity and run it how you want, not how Facebook wants it run. It gets rid of all those nasty pokes and prods, and Cousin It's baby belching. If someone wants to contact you, they can message you on Facebook, so delete all emails from that site asking you to join. Unread. Cuts down on the viruses that slip through if you are using Outlook.
Lastly, make sure you know how to get rid of a root kit virus yourself. There are several excellent sites that can rescue your computer from stuff-ups. Its simple, and saves a lot of money and time if you can do it yourself. And disconnect your back-up drive from your computer unless you are backing up (after thoroughly checking your computer for malware and trojans first), otherwise your back-up can also be infected.
This is all very basic stuff, not rocket science or even geeky. Its as easy as putting on a condom, and just as you would not have unprotected sex with a stranger, why risk it in the virtual world; the risks are just as great and the results of infection are very nasty. Loss of data is far worse than a dose of clap.
Alert moderator
PW:
20 Dec 2013 5:56:41pm
Netscape was not the first web browser. It was preceded by (and based on) Mosaic, which while being credited as the first graphical browser, was preceded by Viola, WorldWideWeb and Erwise.
Alert moderator
stephen:
20 Dec 2013 6:16:37pm
Actually, I like all those providers the author mentions.
Amazon : I buy from very often. The local firm - Booktopia - does not have the range, so I go overseas. It is convenient.
Apple : I own every iPod they've marketed ... plus a laptop, though I wanted one with a blue-ray. 'No dice' said the salesman. Anyway, their music software - mainly classical and pop - is first rate for ease of use and recent releases ... though I wish the sound quality was better. I grew up with the LP, and got a trannie for my 13th birthday ; great in 1970, but now I've got the musical world at my ears ... and the world of my choice. (Nothin' like it)
The other two are information modules, and I figure that, seeing as how I live here, in post-Woodstock times, it might be a while before someone comes up with telepathy, so, why not get used to the information of others' wants and beliefs via the machine ? It seems that to know secrets is not so dire, unless someone makes a mountain of it all ... in which case, you could ask them what is the worst thing that can come from the digestion of meagre truths that were not known yesterday ? The worst thing ain't so bad, anyway ! (And if it is, then you shouldn't be talking about it)
There's a lot of talk about 'privacy'. And it is indeed a type of ownership. We own our secrets. But nothing's really at stake that is so important that the benefits and friendly exchanges from the internet should be questioned because someone (else !) makes a lot of money from it ... and I query the motives of people who feign the good heart on behalf of the rest of us shove envelopes under our door, where we can read that we are being duped, that nothing good will come from knowledge, and we should mind our business because business has our worst-case scenario in mind.
We have our own enemies ; we shouldn't let other people make them for us.
Alert moderator
MGV:
20 Dec 2013 6:34:24pm
There were those that rallied against the printing press.
Legislation will catch up to innovation then fall behind again.
Winners will emerge in the digital revolution as winners emerged in the industrial revolution.
We didn't start the fire...
Alert moderator
Peter of Melbourne:
20 Dec 2013 6:58:08pm
The Internet was never designed for nor claimed to be for a free and open market. Rightly or wrongly that is just our expectations.
Alert moderator
Comments for this story are closed, but you can still have your say.