‘China is run by engineers, US by political lawyers’: Tech pioneer’s warning

He was close to his father, less so his mother. When he was 14, Raduchel snr, a local official and petrol station owner, died. “My father would always check my homework,” Raduchel jnr says. “And when he died, I think the only way I thought I knew that I could please him was to have perfect homework.”

Already a good student, Raduchel excelled and propelled himself into university, first at a state level and then Harvard on scholarships. A talent for early computers the size of semi-trailers got him research work and administrative jobs, then into the private sector where he rose rapidly to management roles, many of which were about doing deals.

We’re talking not long after an image of a tech worker wearing a shirt with a woman’s naked torso printed on it while questioning Google co-founder Sergey Brin on the company’s attempts at generating diverse AI results went viral. How does Raduchel think about managing such talented but prickly, to put it mildly, employees who proliferate among the tech workforce?

The rub of his answer is that talent prevails, especially as AI automates more mundane tasks. “We’re headed toward a world in which almost every company is going to look like a professional sports [team],” he says. “And you’re going to have players, and you’re going to have employees.”

Some of the technology companies that have been most successful at retaining these star employees such as Google, he says, have let them work on their own projects and eliminated middle managers. But then decisive management is key too, he says, citing brilliant calls made by Google’s founders and others. How to balance those things is hard, though he is adamant that consultants aren’t the answer. “Ninety per cent of almost every time I’ve watched consultants come in, the answer was obvious before they started,” he says with the voice of a man who has seen it many times.

It’s quaint now, but when Raduchel worked at Xerox in the mid-1980s, the business was at the bleeding edge of innovation because of its printers. Its alumni went on to found companies including Adobe, which makes Photoshop and is worth $US221 billion.

Xerox, which is still listed on the Nasdaq, is now worth $US1.6 billion. Adobe is now under threat from Australia’s Canva, which caught it napping on simple design software for amateur users. But Canva is worth only a 10th of Adobe, and other longstanding technology giants such as Google, Microsoft and Amazon look likely to benefit from, rather than be disrupted by, artificial intelligence.

Raduchel is more optimistic that the cycle of innovation and disruption, which are hallowed buzzwords in Silicon Valley, will continue. “Everybody’s going to have a personal digital butler,” he says.

Befitting a man who knows his status miles, he gives the example of a traveller booking a trip replete with flights, hotels and visas just by asking an AI assistant for it. That will upend the standard model of selling things to people through phones and apps, he predicts. After we talk though, a couple of companies making physical devices to house those assistants – one called Rabbit and the other Humane – debut their buggy products to dire reviews.

The peak of Raduchel’s career was at AOL, the company that got huge numbers of Americans to log onto the internet for the first time, from 1999 to 2004. In 2000, AOL merged with storied media conglomerate Time Warner in a disastrous $US350 billion transaction. Fuelled by the dotcom boom, AOL’s share price was way ahead of its earnings and it failed to gel with Time Warner, which killed off plans for an internet set-top box.

Here Raduchel, who was chief technology officer, is on steady ground. In The Bleeding Edge, an observation on why the merger did not work stands out. “Content was king at Time Warner and again at AOL Time Warner, and for reasons I still find hard to fathom, that meant technology could not be important,” he wrote. “It is not a logical choice; a culture simply cannot tolerate more than one group of priests.”

There’s a warning there for other businesses he says: what of the financial institutions that now have more software engineers than bankers? The New York Times, too, has a great fleet of technical staff, Raduchel notes, which has caused problems in the past when their ideology has clashed with the paper’s non-partisan mission.

AI regulation

He’s bearish on regulation as the solution for the problems of the ever-rising power of technology. “It’s embarrassing,” he says, of the US government’s antitrust lawsuit against Apple alleging it has operated its app store as a monopoly. Raduchel has form here, having tangled with Microsoft in the courts and deal rooms at Sun and AOL. The difference is that he doesn’t see Apple’s app store as a true monopoly, whereas he thinks Microsoft crossed the line.

Yet, he offers some praise for China’s much more controlling system of government. “China is run by engineers. The US is run by political lawyers,” Raduchel says, not entirely accurately, given many of China’s leaders are the children of communist revolutionaries. “If you’re on a rocket ship, you’d rather have the engineers running the rocket ship.”

One area where Raduchel thinks regulation in the West could be workable is requiring a licence for people developing AI tools to ensure someone is accountable for them. It’s not the only arresting remark he makes during our conversation.

Earlier, he says he thinks the Great Barrington Declaration, an October 2020 open letter that called for COVID-19 to be allowed to spread to create “herd immunity” among the younger, healthy population before there were vaccines to stop mass deaths, was “probably the right answer”. And he claims the former US National Institutes of Health director Anthony Fauci “will make tens of millions of dollars off of the vaccines”.

(Documents released by the NIH confirm its researchers do get royalty payments for medications based on patents they contributed to. Fauci has received some of those, but the independent FactCheck.org has reported they do not appear to relate to COVID-19 vaccines and Fauci has previously said he donates royalty money to charity. What payments he may receive in future are unclear.)

Raduchel got into this vexed space in the pandemic, when he spent 90 days in lockdown, speaking regularly to his doctor, eventually taking a tuberculosis vaccine called BCG and reading medical newsletters. It must’ve been a trying way to spend time for someone who has worked so doggedly throughout his life, to the exclusion of a partner and children. His mother, whom he cared for at his home, had died at 95.

It’s not that he had no fun in his career. He remembers meeting with Japanese business partners when working for Sun Microsystems in the 1990s, who felt it was improper to play golf on company time. “I scratched out ‘golf’ and I wrote in ‘informal executive exchange’,” he says with a laugh. It was a raging success.

Yet for all the 80-hour weeks and trans-Pacific flights Raduchel logged in an industry that venerates founders, he never created his own company. “I ended up being a very good number two,” he says with a hint of weariness but no bitterness.

As we’re winding down, he kindly orders a scoop of ice-cream to match my indulgence of a rhubarb and custard number. There’s just enough time to ask what Raduchel – sceptic of government at other points in the conversation – thinks of Yellen’s performance as Treasury Secretary, a job where she is both pivotal to the US economy and in hock to the White House.

“I admire and respect her,” he says of the woman he dated decades ago, before she wed her husband. But he adds: “In any of those jobs … you’ve got to make impossible decisions, and it’s hard to be right.”