Civilization, complexity and the limits of human cognition - another attempt at explaining the 21st century

The 70s were pretty weird, but I was too young to notice. (Not coincidentally, the Toffler/Farrell Future Shock book was written then.) By comparison the 80s and 90s more or less made sense. In 1992 Fukuyama wrote "The End of History" and that seemed about right for the times.

Things got weird again in the late 90s. I was in a .com startup and I remember valuations getting crazy about 1997, 3 years before the .com crash. We were still picking ourselves up from the crash when 9/11 hit. (A year later, on a purely personal note, my youngest brother vanished.) In the early 00s came Enron and other frauds almost forgotten now. Then in 2008 the real estate collapse and the Great Recession. We were barely recovering from the Great Recession when Trumpism hit. Followed by COVID (which was expected and not at all weird) and the Great Stupidity of the American Unvaccinated (which we did not expect and is perhaps weirdest of all).

Each time the world went off kilter I have tried to figure out a root cause:

In Feb 2009 I tried to figure out the crash of 2008:

At last count my list of contributing factors to the crash of '09 included ...

1. Complexity collapse: we don't understand our emergent creation, we optimized for performance without adaptive reserve
2. Mass disability and income skew: The modern world has disenfranchised much of humanity
3. The Marketarian religion: The GOP in particular (now the Party of Limbaugh), but also many Democrats and libertarians, ascribed magical and benign powers to a system for finding local minima (aka The Market). The Market, like Nature, isn't bad -- but neither is it wise or kind.
4. The occult inflation of shrinking quality: What happens when buyers can't figure out what's worth buying. Aka, the toaster crisis - yes, really.
5. performance-based executive compensation and novel, unregulated, financial instruments: a lethal combination. See also - You get what you pay for. The tragedy of the incentive plan.
6. Disintermediating Wall Street: Wall Street became a fragile breakpoint 
7. The future of the publicly traded company: A part of our problem is that the publicly traded company needs to evolve
8. The role of the deadbeats: too much debt - but we know that
9. Firewalls and separation of powers: a culture of corruption, approved by the American electorate, facilitated dissolving regulatory firewalls
10. Marked!: Rapid change and the Bush culture made fraud easy and appealing

I put Marked! pretty low on the list, but maybe I should bump it up a bit. The Hall of Shame (Clusterstock) lists a lot more fraud than has made the papers [1]...

• Fairfield Greenwich Group: quietly complicit in the Madoff fraud?
• Angelo Mozilo: white collar mobster
• Sam Israel: a $400 million fraud. In the old days, he'd have been front page news. I never heard of him.
• Many more, each of which would have been in the news once - including: JS Forte, RS Piccoli, JG Ossie, D Palmer, A Nodel, Marc Dreier.
• Those swindlers who have made the news... Allen Stanford, and, of course, Mr. Madoff.

By 2010 I was focusing on RCIIIT: The rise of China and India and the effects of IT.

... The Rise of China and India (RCI) has been like strapping a jet engine with a buggy throttle onto a dune buggy. We can go real fast, but we can also get airborne – without wings. Think about the disruption of German unification – and multiply than ten thousand times.

RCI would probably have caused a Great Recession even without any technological transformations.

Except we have had technological transformation – and it’s far from over. I don’t think we can understand what IT has done to our world – we’re too embedded in the change and too much of it is invisible. When the cost of transportation fell dramatically we could see the railroad tracks. When the cost of information generation and communication fell by a thousandfold it was invisible ...

In 2016 and again in 2018 I tried to explain Trumpism by contributing factors (I was too optimistic about Murdoch's health though):

• 65% the collapse of the white non-college “working class” — as best measured by fentanyl deaths and non-college household income over the past 40 years. Driven by globalization and IT both separately and synergistically including remonopolization (megacorp). This is going to get worse.
• 15% the way peculiarities of the American constitution empower rural states and rural regions that are most impacted by the collapse of the white working class due to demographics and out-migration of the educated. This is why the crisis is worse here than in Canada. This will continue.
• 15% the long fall of patriarchy. This will continue for a time, but eventually it hits the ground. Another 20 years for the US?
• 5% Rupert Murdoch. Seriously. In the US Fox and the WSJ, but also his media in Australia and the UK. When historians make their list of villains of the 21st century he’ll be on there. He’s broken and dying now, but he’s still scary enough that his name is rarely mentioned by anyone of consequence.
• 1% Facebook, social media, Putin and the like. This will get better.

That 1% for Facebook et all is pretty small — but the election of 2016 was on the knife’s edge. That 1% was historically important.

A few months ago I listed 3 causes for the post-COVID supply and labor shock economics of 2021:

1. Wealth became extremely concentrated. 

2. Returns on labor for 40% of Americans fell below modern standard for economic life.

3. Good investments became hard to find.

It's almost 2022 now, so we're into almost 25 years of the world not making sense any more. So now I'm digging even deeper for a root cause.

Today I'm going with Gordon's Law: the complexity of a complex adaptive system will increase until it reaches a limiting factor. Our civilization is a complex adaptive system and its complexity increased until it hit a limiting factor -- the complexity capacity of the average human. These days between 40 and 50% of American's can't handle civilization 2021 (sometimes I call this mass disability (see also). Witness among other things, The Great Stupidity of the FoxCovians.

It's a variant of the "Future Shock" Toffler wrote about 52 years ago. I don't have a fix; I don't think the world will get less complex. Our technologies are moving too fast. Maybe we'll just get used to not understanding the world and civilization will stumble on regardless. After all, for most of human history the world was incomprehensible -- and we did manage. Sort of. Mostly without civilization though ...

Trumpism: a transition function to the world of mass disability.

We know the shape of the socioeconomic future for the bottom 40% in the post globalization post AI  mass disability world.

But how do we get there? How does a culture transition from memes of independence and southern Christian-capitalist marketarianism to a world where government deeply biases the economy towards low-education employment?

There needs to be a transition function. A transform that is applied to a culture. With the anthropology perspective I’ve long sought Arlie Hochschild makes the case that Trump is, among other things, a transition function that erases Tea Party Marketarianism and embraces the heresy of government support (albeit for the “deserving”).

In a complex adaptive system we get the transition function we need rather than the one we want. No guarantee we survive it though.

See also:

• Trumps is a Politics of Loss and Revenge 8/2016: Marshall demolishes false dichotomy between economic distress and white racism.
• Gordon's Notes: Donald Trump is a sign of a healthy democracy. Really. 8/2015. Well, today I’d write “a desperate democracy”, but my tough love take on why we have this pathologic human being contending to more or less destroy civilization.
• Trump explained: Non-college white Americans now have higher middle-aged death rates than black Americans 11/2015. Marshall does a better job in his 2016 post.

Aetna's unethical cost savings are enabled by the "arbitration" laws purchased by large corporations

The New York Times did a superb series this fall on how large corporations changed American law to neutralize a major consumer protection — the class action lawsuit. Arbitration clauses mean a single consumer goes up against multi-million dollar legal teams, a hopelessly mismatched battle.

I realize that’s why Aetna can get away with cutting health insurance costs through strategic incompetence. Ten years ago if they were routinely evading their contractual obligations they’d be subject to a multi-million dollar suit. Sure, any penalties would be too small to truly impact Aetna, but a potential payoff would be big enough to fund a suit. More importantly, once a judgment was made, Aetna would need to wind the scam down — a recurring judgment might eventually amount to real money.

Today there’s really no downside for them. I’m certainly not going to take them to arbitration. So, yes, the Feds should block Aetna and Anthem’s acquisitions, but this is just one facet of a much bigger problem. The modern mega-corp has damaged our political and commercial landscape — from secular stagnation to political corruption. It may take the second coming of Theodore Roosevelt to set things right.

Happy accident fraud - Feds move on Aetna and other health insurers with deceptive provider listings

Happy accident frauds are emergent frauds — nobody needs to plan them. Don’t put your Disability Claims office on the fifth floor of a building with a faulty elevator to defraud anyone, just do it for the cheap rent. Then save costs by replacing your customer support staff with an automated call management system.

The insurance industry is great at emergent frauds enabled by complexity and powered by perverse incentives. It’s baked into their business model; any player who doesn’t cheat will go bankrupt.

So it’s not surprising that health insurers competing in public marketplaces have produced inaccurate physician directories. It’s not limited to public ACA style coverage, we get our Minnesota health care through an employer plan, and after we chose Aetna we discovered their oral surgery listings were fictional. They seemed to have many providers available in our area, but all the ones we called said the listing was wrong.

Why pay the costs to maintain an accurate listing when an inaccurate listing gets you customers who can’t actually make claims?

The good news is that the Obama administration is now starting to address the problem. Alas, the fines are likely to be pathetically small, we’ll need class action litigation to really change things or find ways to drive the worst offenders out of business by failure of ‘network adequacy’. (emphases mine, note the related problem of prince concealment in the industry, another part of a fundamentally murky business)

White House Moves to Fix 2 Key Consumer Complaints About Health Care Law - NYTimes.com

The White House is moving to address two of the most common consumer complaints about the sale of health insurance under the Affordable Care Act: that doctor directories are inaccurate, and that patients are hit with unexpected bills for costs not covered by insurance.

Federal health officials said this week that they would require insurers to update and correct “provider directories” at least once a month, with financial penalties for insurers that failed to do so. In addition, they hope to provide an “out-of-pocket cost calculator” to estimate the total annual cost under a given health insurance plan. The calculator would take account of premiums, subsidies, co-payments, deductibles and other out-of-pocket costs, as well as a person’s age and medical needs.

Since insurers began selling coverage through public marketplaces 19 months ago, many consumers and doctors have complained that the physician directories are full of inaccuracies. “These directories are almost out of date as soon as they are printed,” said Kevin J. Counihan, the chief executive of the federal insurance marketplace.

Medicare and Medicaid officials have found similar problems in the directories of insurance companies that manage care for beneficiaries of those programs. In December, federal investigators said that more than a third of doctors listed as participating in Medicaid plans could not be found at the locations listed.

The new standards significantly strengthen an earlier rule, which required insurers to publish directories online and to make paper copies available on request. In the federal exchange, violations are subject to civil penalties of up to $100 a day [ed: 0.000001% of revenue?] for each person adversely affected.

Federal officials said that inaccurate provider directories could be a sign of larger problems. If doctors listed in a directory are not available or are not taking new patients, consumers may not have access to covered services, and the insurers may not meet federal standards for “network adequacy,” the officials said. Consumers must often pay extra when they use doctors outside the network of their health plan, so an inaccurate directory could also lead to higher costs for patients.

… Aetna says that data in its directory is “subject to change at any time.” UnitedHealth tells Medicare beneficiaries, “A doctor listed in the directory when you enroll in a plan may not be available when your benefits become effective.” …

See also:

• Emergence: how entropy and incentives create scams: 2009, Aetna’s FSA management - just make it hard to process a claim
• Mobile phone fraud - The accidental data charge and other scams: 11/2009. A lot of these scams have gone away during the Obama administration, thanks to more competition between carriers and a lot of regulatory action. Government can work.
• Emergence: how entropy and incentives create scams 2/2009.
• Emergent fraud: Anthem and automatic payment denials 9/2010
• Anthem - Putting the Hell in Health Insurance 8/2010
• Health insurance: we’re defeated by a complexity attack 11/2009
• Employment benefit complexity: we are sheep 11/2007
• The hidden insurance problem: they can play the game better than we can 11/2007

IT and productivity - two noteworthy posts from Equitable Growth

Brad DeLong, as best I can tell, does not lead the Washington Center for Equitable growth. Along with Nick Bunker he does, however, produce many of their best blog posts (RSS icon proudly displayed) - like two from a Hamilton Project Future of Work conference (intro PDF, Brynjolfsson and McAfee [1]) that I recently posted back-to-back in my app.net feed.

The first is by Brad, taken from a Larry Summers speech which explains why Summers matters (emphases mine) …

Morning Must-Watch: Larry Summers and Friends: The Future of Work - Washington Center for Equitable Growth

… we have enormous antidotal evidence and visual evidence of [modern IT/AI] technology having huge and pervasive effects … On the other hand, the productivity statistics over the last dozen years are dismal. Any fully-satisfactory synthetic view has to reconcile those two observations…

… I think it is a mistake to think of the economy as homogeneous–as producing something called “output”. As we approach these issues, an aspect that doesn’t get enough attention is that sectors through progress work themselves into economic irrelevance. … candle-making was a major industry in the 1800s, illumination is a trivial industry today…. 

We need to recognize that a sector that has rapid technological progress but of which the world can absorb only so much becomes ultimately unimportant in the economy….

…Consider two goods today: a television set, and a year at a university (or I could use a day in a hospital). The consumer price index for the latter two categories is in the neighborhood of 600. the consumer price index for the former category is 6. There has been a hundredfold change in the relative price of TV sets and the provision of basic education and health care services.

If anybody is wondering why governments can’t afford to do the things they used to do, I just gave you a big hint.

If anybody’s wondering where most people are growing to be working in the future, i just gave you a big hint.

If anybody’s completely confident we will have rapid productivity growth in the future, they should be giving pause–because no matter how much productivity we have in agriculture or illumination, it doesn’t really matter for the aggregate economy. Increasingly, that’s becoming true of a larger and larger fraction of what it is that we produce.

…  in the 1960s,= ,,,  about 6% of the men in the United States between the age of 25 and 54 were not working. Today, 16% of the men in the United States between the age of 25 and 54 are not working. It won’t be very different even when the economy is at full employment.

Something very serious has happened with respect to the general availability of quality jobs in our society.

… Whether you think it is due to technology or to globalization or to the maldistribution of political power, something very serious is happening in our society.

The second is by Nick Bunker …

What to worry about on the supply side - Washington Center for Equitable Growth

…  A new paper by economists Stephen G. Cecchetti of Brandeis International Business School and Enisse Kharroubi of the Bank of International Settlements argues that an over-bloated financial sector can reduce productivity. They contend that by drawing talented workers toward Wall Street, the finance sector lowers the total productivity rate….

From Summers we see that certain technologies have dramatically diminishing returns, so that they become a smaller part of a larger whole. Obvious, now that he’s pointed this out. There is only so much light that we can use. Is this also true of computing power? Is it true of energy?

Is Summers saying all employment will shift to expensive and inefficient health care and education? Isn’t that what Baumol said?

It’s a good exercise to consider how computational processing could follow the path of the lightbulb. There is, for me, no significant difference between a response time of milliseconds and picoseconds. Between modern processors and SSDs there seems no pressing need desktop performance increases. To some extent the human users is the rate limiting step. Only when one eliminates the human user does a millisecond vs. picosecond delay matter, as with high frequency stock “trading” (manipulation) — or the timescales of an AI.

Thinking of high frequency trading, we are reminded that vast amounts of modern economic activity transfer wealth without producing product. They have low to negative productivity, as found by Cecchetti and Kharroubi. Some of these are parasitic processes as would arise from any complex adaptive system, others are forms of more or less transparent fraud rooted in complexity exploitation. In our times information technology has been an essential enabler of both.

Considering failures of productivity enhancement, what do we make of Google Search? Ten years ago Google Search was miraculous, now it increasingly fails to produce much of value [2]. The web grew very quickly on an advertising based business model, but that model has failed and a new model is unborn. Progress is unpredictable in whitewater times.

Or consider email. We’ve been using it widely for almost 30 years, yet very few people use email well. Much time in routine corporate life is wasted by incompetent email [3]. Alas, email’s failures can’t compare to the disappointment of the “electronic health record” or “EHR”

Ahh, the EHR! What dreams we had in the 1980s. Dreams that took me from rural practice to another degree to a career in healthcare IT. It was so obvious how patients would benefit, and how all providers would become far more productive. 

The reality of the EHR has been a crushing disappointment. One day, perhaps, the dreams will come true — but nobody in 1990 would consider the state of clinical automation in 2015 anything but an appalling failure. A failure not of technology, but of business incentives, of markets, and of complex interlocking rigidities.

The list goes on. The same technology that enables location-based alerts also enables malware and adware.  Our economic landscape has been transformed; new technology causes vast wealth creation, but then wealth concentration drives the greater economy to a stagnant deflationary spiral.

Perhaps we’ve been here before. It took 60 years after the 1780 “start” of the industrial revolution for worker living standards to definitively rise. If our revolution started 70 years ago, maybe the rise will start any time now.

Or perhaps we’re headed in a different direction. An Economy is not a system for satisfying humans, or a system for producing goods or wealth or jobs. The “Complex Adaptive System” cliche truly applies. It is an immaterial ecosystem that produces things like wealth and jobs, but also emergent amoebacorp and brain sucking jobs in finance. The Economy is a beast of its own, slouching towards Bethlehem.

- fn -

[1] The PDF includes two killer graphs …

and

 

[2] While writing this post I often searched for prior posts in notes.kateva.org. Google did a poor job, Duck Duck Go constrained to “site:kateva.org” did much better.

[3] If you ever hear of a corporation that teaches employees to write effective email please let me know. I’d like to buy shares.

Related

• Global finance and parasites 9/2009
• Secular stagnation and the Beveridge curve - the role of frail boomer parents 6/2014
• Speculation: The corporate ecosystem and American stasis: corporations are players independent of their owners and managers, and they have changed our financial ecosystem the same way algae change a pond (Amaebocorp) 11/2010.
• The morality of markets - and a response to hunger 9/2010
• Baumol’s cost disease: medicine, education and post-AI disruption 10/2012
• Fraud, IT, Economics and the Depression: Galbraith is most impolite 8/2011
• Finance 2.0, Oil and Project Syndicate - entertainment 2012! 12/2011
• Fraud on Cyber: An annotated sample of Gordon’s Notes 8/2011
• Causes of the Great Recession: China, GPSII and RCIIIT. Now for Act III. 4/2010
• 21st century deception and the evolution of the emergent mind 6/2007
• The IQ of an ecosystem and other questions of emergence 5/2007 

Dynamic stability: struggle and balance in minds, brains, genomes, pregnancy, politics, ecosystems and economies

The minds we experience are based on multiple overlapping, redundant and competitive brain systems (I don’t get the term “degeneracy” btw) that can survive injury and genome bugs. Genome expression works the same way, which is why we’ve made so little progress with genomic medicine since 1994.

Human pregnancy works the same way — a dynamic struggle (war), a kind of tension control system.

American politics too — something to remember amidst the yammering and yelling and general madness - a reason for optimism.

So do ecosystems of course; and thus eco-econ says so do economies.

This is something we probably ought to think about a bit more.

Humbug - Amazon, Apple and Pottermore

In the spirit of the season, which science tells us is Scrooge before his psychotic break, a call out to Amazon, Pottermore, and Apple.

To Amazon for the increasingly common practice of merging multiple product reviews into a single listing (example, Dec 2014). This renders the reviews worse than useless — because they are now misleading. I don’t know whether this is some kind of emergent fraud that enables vendors to hide bad reviews, or whether it’s an incompetent Amazon implementation, but I’m now boycotting any product that is part of a unified listing that blends inconsistent products. You should too.

To Pottermore and Apple for the hash the two of them have made of Potter audiobooks. They’re no longer available on iTunes, and if one downloads the MP3 from Pottermore they import into iTunes as music. Thanks to Apple’s comprehensively botched iTunes 12 removal of multi-edit [1], few will be able to transform these into audiobooks that play in sequence, have the right controls, and remember their playback location when stopped. Worst customer experience of the season.

And an extra call out to Apple for removing, with iTunes 11 (2013), the ability to print iTunes Gift Certs at home. I didn’t notice this because I stayed on iTunes 10 through Dec 2013. Email delivery is the only option now. Way to go Apple.

And some people wonder where all our leisure time went.

On the Marley side of things, my gift was a minced fruit pie and it is quite delicious.

[1] Through a bug or the last act of some desperate dev, there’s a hidden way to access the old multi-edit feature. Hold option then click on Get Info. Not one in 200 will know this.

Human pregnancy is a dynamic struggle - implications for eco-econ, corporate power and secular stagnation

At the “Spherical Cow” level of simplification, human pregnancy is a dynamic tension control system, a kind of brain and gene motivated cold war between fetus and host (emphases mine)

Pregnancy is a war between mother and child – Suzanne Sadedin – Aeon

As the pregnancy continues, the foetus escalates its hormone production, sending signals designed to increase the mother’s blood sugar and blood pressure and thus its own resource supply. In particular, the foetus increases its production of a hormone that prompts the mother’s brain to release cortisol, the primary stress hormone. Cortisol suppresses her immune system, stopping it from attacking the foetus. More importantly, it increases her blood pressure, so that more blood pumps past the placenta and consequently more nutrients are available to the foetus.

The mother … pre-emptively reduces her blood sugar levels. She also releases a protein that binds to the foetal hormone, rendering it ineffective. So then the foetus further increases its production. By eight months, the foetus spends an estimated 25 per cent of its daily protein intake on manufacturing these hormonal messages to its mother. And how does the mother reply? She increases her own hormonal production, countering the embryo’s hormones with her own that decrease her blood pressure and sugar. Through all this manipulation and mutual reprisal, most of the time the foetus ultimately gets about the right amount of blood, and about the right amount of sugar, allowing it to grow fat and healthy in time for birth.

Pre-eclampsia may represent a malfunction of these balancing factors — a malfunction that injures both fetus and mother (many wondered about this in the early 90s).

Eco-econ principles suggest we look for this kind of evolved dynamic tension in our economic and political systems. We might look at something like this…

a three way struggle between powerful economic (voters are also customers) and political forces. 

By analogy our current situation of secular stagnation and extreme wealth concentration is the equivalent of pre-eclampsia — a dynamic control system disorder that ultimately injures even the dominant powers. Corporations  and powerful individuals have accumulated too much wealth and power, resulting in dysfunctional patent laws, increasingly oppressive non-compete contracts, and a corrupt political system.

We can either rebalance our control systems, or we can develop eclampsia.

Who killed American broadcast TV time-shifting -- and how did they do it?

I’ve been gnawing on this story for a year or two, figuring that sooner or later a real journalist would solve the mystery for me. That hasn’t happened, or perhaps Google’s increasingly lousy search results [1] just can’t find the article.

So it’s time for me to try to solve the mystery. Who killed broadcast (over-the-air, OTA) TV time-shifting in America?

Yes, there was a murder. Americans used to easily time shift broadcast television. From 1975 to through the 1990s we use VCRs (a marvelously complex device). In 1999 ReplayTV and TiVo introduced products that could digitize analog television and store data on an internal hard drive; early versions would even automatically delete commercials, which produced some tension. During the early 00s we saw many simple devices for digitizing analog signals, typically sold for under $100. 

During this golden age of OTA time-shifting there was some serious tension— especially when ReplayTV auto-zapped commercials (and was litigated to death). A series of court cases walked a fine balance between consumer and corporate interprets. Then, around 2007, it all went to heck, and low cost time-shifting was doomed. 

So what happened to change things in 2007?

The precipitating event was digital TV — after long delays it was coming to the US. Not just coming, but coming in high definition with an unencrypted signal that would be trivially easy to capture as binary MPEG — much easier than digitizing an analog signal or building a VCR. It costs only a few dollars to add recording to a digital TV (storage extra) [5], and a tuner and encoding device could profitable be sold for under $50 (storage extra). There was no easy way to prevent capture and HD res redistribution of an NFL game or a broadcast movie. This was disruption on a colossal scale, the same kind of disruption that transiently [2] broke the music business.

In this case impending doom focused minds - and, in America, the threat was crushed. As of May 2014 there’s exactly one company offering a quality OTA HDTV recorder, TiVo, and their current entry level product costs $700 [6]. Worse when TiVo goes out of business today’s devices will stop working (older devices will still work).

This surprises a lot of people who bought OTA DVR devices between 2007 and 2012. They think products like Elgato’s EyeTV are still sold. Well, they are, just not in the US:

Elgato does still sell products that stream to iPads; just not to a television — and they’re not the only ones. It’s the same story with devices like Simple.TV and Tablo. They may stream to an iPad or Android tablet [3], but direct connections to a TV are off-limits. There’s no HDMI out;  Tablo’s excuse for the missing HDMI is amusingly coy. I assume there’s something about omitting a direct connection to a television that dodges the TiVo patent and “TiVo tax”. The only subscription-free devices I could find with HDMI out were the expensive and poorly reviewed Channel Master DVR+ (lousy tuner, and I suspect soon to sued into the ground) — and a rapidly iterating array of very low quality pure-China patent-dodging devices (sue them and they come back under a different name).

So murder was done, but we still don’t know who - and how. We know of at least 3 suspects with abundant motivation and shady records: Comcast/NBC, Viacom/CBS, and DIsney/ABC. All three had motivation, and the means of the US patent and legal systems….

Digital video recorder - Wikipedia, the free encyclopedia

On July 14, 2005, Forgent Networks filed suit[31] against various companies alleging infringement on U.S. Patent 6,285,746 [teleconferencing!], entitled “Computer controlled video system allowing playback during recording”. The listed companies included EchoStar, DirecTV, Charter Communications, Cox Communications, Comcast, Time Warner, and Cable One.

… Motorola requested that the United States Patent and Trademarks Office reexamine the patent, which was first filed in 1991, but has been amended several times.[32]

On March 23, 2007 Cablevision Systems Corp lost a legal battle against several Hollywood studios and television networks to introduce a network-based digital video recorder service to its subscribers.[33] However, on August 4, 2008, Cablevision won its appeal. John M. Walker Jr., a Second Circuit judge, declared that the technology "would not directly infringe" on the media companies' rights.[34] An appeal to the Supreme Court was rejected.

In court, the media companies argued that network digital video recorders were tantamount to video-on-demand, and that they should receive license fees for the recording. Cablevision and the appeals court disagreed. The company noted that each user would record programs on his or her own individual server space, making it a DVR that has a "very long cord."[34]

In 2004, TiVo sued EchoStar Corp, a manufacturer of DVR units, for patent infringement. The parties reached a settlement in 2011 wherein EchoStar pays a one-time fee (in 3 structured payments) that grants Echostar full rights for life to the disputed TiVo patents upon first payment(as opposed to indefinite and escalating license fees to be constantly renegotiated), and Echostar granted TiVo full rights for life to certain Echostar patents and dropped their counter-suit against TiVo.

In January 2012, AT&T settled a similar suit brought by TiVo claiming patent infringement (just as with Echostar) in exchange for cash payments to TiVo totaling $215 million through June 2018 plus “incremental recurring per subscriber monthly license fees” to TiVo through July 2018, but grants no full lifetime rights as per the Echostar settlement.

In May 2012, Fox Broadcasting sued Dish Network. Fox argued Dish's settop box with DVR function, which allowed the users to automatically record primetime programs and skip commercials, was copyright infringement and breach of contract. In July 2013, the 9th circuit rejected Fox's claims.

No, I can’t tell who won either — Wikipedia links out in a bewildering array of suits like including…

Sony Corp. of America v. Universal City Studios, Inc.
Sega v. Accolade
Cartoon Network, LP v. CSC Holdings, Inc.
CoStar v. LoopNet
Fox Broadcasting Co. v. Dish Network, LLC 

My best guess is that the our “murder” suspects came to a mutual agreement with TiVo and other patent holders to build a solid patent wall - augmented by DMCA’s ability to block bypass solutions [8]. That patent collection and a limitless legal defense fund ensured the end of low cost OTA digital TV recording in the United States. The HD digital apocalypse was averted; at $700+ a device TiVo is no threat — it’s just a patent holder and patent licensor whose primary value is keeping a lid on OTA recording…

• TiVo Settles Patent Suits with Cisco, Google and Time Warner Cable | Variety … “The payments from Google and Cisco bring the total from awards and settlements related to the use of TiVo’s patents to roughly $1.6 billion, including previous deals with Dish Network, AT&T and Verizon, according to TiVo…TiVo entered into cross-licensing agreements with Google and Cisco and agreed to grant Arris Group (which acquired the Motorola set-top unit from Google) a limited license to four patents…

We have a body, motive and means — but only circumstantial evidence. With a bit of digging we could build a real case, but there’s a minor detail I’ve left out of the story.

The minor detail is that nobody cares - the victim was a homeless bum. Americans who don’t pay for Cable TV are either poor non-voters or relatively wealthy skinflint whackos - like us. Of the whacko cord-cutting skinflint contingent, only a small portion really want to do time-shifting. If not for our #1 son’s sports love we wouldn’t even bother with a TV antenna (the other kids watch iTunes rental movies once a week or so, I don’t watch TV at all).

So we’re talking a niche of a niche. Meanwhile there’s enormous economic pressure to turn broadcast spectrum into IP traffic - and end broadcast TV altogether. Sooner or later the market will find a way to do that; today’s DVR murder will be just a minor foreshadowing of the end of broadcast TV.

Still, it’s a fascinating story — to me at least. I love figuring out how “the system” solved the HD TV apocalypse - even if the results frustrated my family. Honestly it makes me feel better about global warming — complex adaptive systems can be extremely inventive.

In the meantime there’s a bit more story to play out. The combination of a Roku 1 ($50, HDMI) and Tablo TV ($210, no-HDMI) [7] will be interesting to watch — not least for the expected blizzard of lawsuits. Chinese manufacturers may improve the quality of their false-flag patent-dodging devices. MythTV might revive (announcements stopped 9 months ago), or maybe small businesses will sell Raspberry Pi solutions. Perhaps niche manufacturers will split the “smart” TV; a standalone digital tuner with HDMI output to receiver and downstream display and sound would make it much easier to hack a DVR into the mix …

See also

• Toshiba - Digital Media Server (DVD Player/TiVo DVR Combo) - SD-H400 3/2004. In the pre-HDTV era we had a lot of choices.
• Tivo Lays Off Most of Its Design Team as It Transitions to the Cloud | Gadget Lab | WIRED
• Gordon’s Tech: ViewTV At-163 OTA Digital TV recorder - my review a patent-dodger from China, alas it sucked 5/2014
• Gordon’s Tech: How to clean up the Samsung Smart TV you shouldn’t have bought 12/2013 - in most of the world you can record HD OTA TV to a USB device attached to this TV.
• Gordon’s Notes: After the Smart TV debacle: what we really want 1/2014
• Watch and record live TV on your Raspberry Pi: | News | TechRadar 5/2013

- fn -

[1] Another story that’s not been told. Is it just me, or is Google search really going South? If so, why?

[2] And therein is a lesson about managing disruption. Sure, the music business was on the rocks — but then file sharing services were slowly beaten into the ground. At the same time CDs started to disappear, as first digital downloads and then streaming took over. With CDs gone and file sharing essentially crushed, revenues are set to return. Streaming prices will rise, DRM may return to downloads, and the disruption will be history.

[3] Walmart now sells a 7” tablet for $70.

[4] $300 on Amazon for a device that should cost a fraction of that price. I assume much of that is patent fees.

[5] Our Samsung Smart TV ships with a USB connector for external storage and a remote with a record button - both disabled in the US.

[6] Yes, $700, as below. Of course it’s usually sold with a mandatory subscription, so this cost is paid out over a few years. The initial retail price is only a downpayment. One teardown estimates the TIVo Roamio costs $170 to make, but of course most of us would be happy with a less deluxe advice. We don’t know how much money TiVo pays for patents or to run their listing service.

[7] Canadian, which may help with the expected litigation. Tablo can be used without a subscription, so although it’s far more expensive than it should be for our purposes, the combined cost of Roku and Tablo is still less than 1/2 the cost of a TiVo. I suspect much of the cost is direct patent fees and costs secondary to patent workarounds.

[8] DMCA made it illegal in the United States to interfere with an encryption chain; I suspect that law prevented some patent block workarounds.

Epilogue

Some people solve Rubik’s cube. That never interested me much; I like to puzzle out this kind of story. I think I’m done gnawing this bone, but if I find a better discussion of what happened I might add some updates. Meanwhile I’m looking for pre-2010 Elgato and TiVo devices — I may even try a Hauppage Windows device in a VM.

Salmon, Picketty, Corporate Persons, Eco-Econ, and why we shouldn't worry

I haven’t read Picketty’s Capital in the Twenty-First Century. I’ll skim it in the library some day, but I’m fine outsourcing that work to DeLong, Krugman and Noah.

I do have opinions of course! I’m good at having opinions.

I believe Picketty is fundamentally correct, and it’s good to see our focus shifting from income inequality to wealth inequality. I think there are many malign social and economic consequences of wealth accumulation, but the greatest threat is likely the damage to democracy. Alas, wealth concentration and corruption of government are self-reinforcing trends. It is wise to give the rich extra votes, lest they overthrow democracy entirely, but fatal to give them all the votes.

What I haven’t seen in the discussions so far is the understanding that the modern oligarch is not necessarily human. Corporations are persons too, and even the Kock Brothers are not quite as wealthy as APPL. Corporations and similar self-sustaining entities have an emergent will of their own; Voters, Corporations and Plutocrats contend for control of avowed democracies [1]. The Rise of the Machine is a pithy phrase for our RCIIT disrupted AI age, but the Corporate entity is a form of emergent machine too.

So when we think of wealth and income inequality, and the driving force of emergent process, we need to remember that while Russia’s oligarchs are (mostly vile) humans, ours are more mixed. That’s not necessarily a bad thing - GOOGL is a better master than David Koch. Consider, for example, the silencing of Felix Salmon:

Today is Felix's last day at Reuters. Here's the link to his mega-million word blog archive (start from the beginning, in March 2009, if you like). Because we're source-agnostic, you can also find some of his best stuff from the Reuters era at Wired, Slate, the Atlantic, News Genius, CJR, the NYT, and NY Mag. There's also Felix TV, his personal site, his Tumblr, his Medium archive, and, of course, the Twitter feed we all aspire to.

Once upon a time, a feudal Baron or Russian oligarch would have violently silenced an annoying critic like Salmon (example: Piketty - no exit). Today’s system simply found him a safe and silent home. I approve of this inhuman efficiency.

So what comes next? Salmon is right that our system of Human Plutocrats and emergent Corporate entities is more or less stable (think - stability of ancient Egypt). I think Krugman is wrong that establishment economics fully describes what’s happening [2]; we still need to develop eco-econ — which is not “ecological economics”. Eco-econ is the study of how economic systems recapitulate biological systems; and how economic parasites evolve and thrive [3]. Eco-econ will give us some ideas on how our current system may evolve.

In any event, I’m not entirely pessimistic. Complex adaptive systems have confounded my past predictions. Greece and the EU should have collapsed, but the center held [4]. In any case, there are bigger disruptions coming [5]. We won’t have to worry about Human plutocrats for very long….

See also

• Princeton Study: U.S. No Longer An Actual Democracy
• Justice Stevens Suggests Solution for ‘Giant Step in the Wrong Direction’
• Economist Receives Rock Star Treatment
• Transcending Complacency on Superintelligent Machines. Hawking, Russell, Tegmark and Wilczek
• The Piketty pessimist | Felix Salmon
• Frustrations of the Heterodox - Krugman

and from my stuff

• Ants, corporations and the great stagnation 12/2011
• Speculation: The corporate ecosystem and American stasis 11/2010
• Corporate growth and the unexpected triumph of central planning 11/2012
• The debt ceiling: Can Goldman Sachs win if the US defaults? 4/2011. 
• Mass disability goes mainstream: disequilibria and RCIIT 11/2011
• The limits of disaster predictions: complex adaptive systems 2/2007
• Fermi Paradox: The solution set is stable 3/2013
• Apologetics: God and the Fermi Paradox 11/2010 (Sort of related :-)
• Sympathy for Economists 8/2013
• The new history is deep history 4/2010. Democracy is but the blink of an eye.

- fn -

[1] I like that 2011 post and the graphic I did then. I’d put “plutocrats” in the upper right these days. The debt ceiling fight of 2011, showed that Corporations and Plutocrats could be smarter than Voters, and the rise of the Tea Party shows that Corporations can be smarter than Voters and Plutocrats. Corporations, and most Plutocrats, are more progressive on sexual orientation and tribal origin than Voters. Corporations have neither gender nor pigment, and they are all tribes of one.

I could write a separate post about why I can’t simply edit the above graphic, but even I find that tech failure too depressing to contemplate.

[2] I don’t think Krugman believes this himself - but he doesn’t yet know how to model his psychohistory framework. He’s still working on the robotics angle.

[3] I just made this up today, but I dimly recall reading that the basic premises of eco-econ have turned up in the literature many times since Darwin described natural selection in biological systems. These days, of course, we apply natural selection to the evolution of the multiverse. Applications to economics are relatively modest.

[4] Perhaps because Corporations and Plutocrats outweighed Voters again — probably better or for worse.

[5] Short version — we are now confident that life-compatible exoplanets are dirt common, so the combination of the Drake Equation (no, it’s not stupid) and the Fermi Paradox means that wandering/curious/communicative civilizations are short-lived. That implies we are short-lived, because we’re like that. The most likely thing to finish us off are our technological heirs.

How could we create an evidence-based classification of disorders of the mind?

The software/hardware metaphor is usually considered as misleading as every other model of mind we've come up with.

I don't agree. My guess is it's an unusually good model -- one rooted in the physics of computation. Anything sufficiently complex can compute, which is, souls aside, the same as running a mind...

... in an alternative abstract universe closely related to the one described by the Navier-Stokes equations, it is possible for a body of fluid to form a sort of computer, which can build a self-replicating fluid robot ...

... A central insight of computer science is that, whenever a physical phenomenon is complex enough, it should be possible to use it to build a universal computer ...

Our minds have emerged to run on our desperately hacked and half-broken brains - in hundreds if not tens of thousands of years. In evolutionary terms that's insanely fast (and did it really never happen before?). Minds route around damage and adapt, as much as they can, to both adolescent transformation and adult senescence; they run and run until they slowly fade like a degraded hologram. It's no wonder minds are so diverse.

When that diversity intersects with the peculiar demands of our technocentric world we get "Traits that Reduce Relative Economic Productivity" -- and we get poverty and suffering. We get disease, and so we need names.

We need names because our minds can't reason with pure patterns -- we're not that smart. With names we can do studies, make predictions, select and test treatments.

Names are treacherous though. Once our minds create a category, it frames  our thinking. We choose a path, and it becomes the only path. It might be a good path for a time, but eventually we have to start over. Over the past ten years researchers and psychiatrists have realized that our old "DSM" categories are obsolete.

So how could we start over? One approach, informed by the history of early 20th century medicine, is to classify disorders by underlying physiology. That's where terms like 'connectopathy' come from, and why we try to define mind disorders by gene patterns.

We need to do that, but lately I've wondered if it's the wrong direction. If minds really are somewhat independent of the substrate brain, then we may find that disorders of the substrate only loosely predict the outcomes of the mind. Very similar physiological disorders, for example, might produce disabling delusions in one mind and mere idiosyncrasies in another.

So maybe we need another way to attach labels to patterns of mind. One way to do this would be to create a catalogue of testable traits for things like belief-persistence, anxiety-response, digit-span, trauma-persistence, novelty-seeking, obsessiveness, pattern-formation and the like. My guess is that we could identify 25-50 that would span traits that are currently loosely associated with both normal variation and TRREPs like low IQ, schizophrenia, and autism. Run those tests a range of humanity, then do cluster analysis and name the clusters.

Then start from there.

 See also:

• Be the Best You can Be: Rebooting pyschiatry: time for a new set of disorders (2013)
• Gordon's Notes: The evolutionary history of minds (2008)
• Be the Best You can Be: Redefining mental retardation and autism - the revolution ahead (2006)
• Be the Best You can Be: Very annoying: the diagnostic criteria for Asperger's are not all that useful (2005) - this was part of the body of work that led to retiring the diagnosis of "Asperger's Syndrome"

Scorched Earth - if Google can't own the web then it must destroy it.

Over the two years Google has knifed a number of open net protocols, including CalDAV, RSS, XMPP, Atom and CardDAV and they split Chrome from WebKit.  They effectively abandoned their wiki and web authoring platform. Most recently they killed Google Reader; the competition-crushing champion for standards-based change notification and information consumption. Feedburner is next, and Blogger will likely be subsumed into Google+ (and perhaps lose its RSS feeds).

It's almost as if Google wants to end the document-centric open web as we have known it.

But why would they do that? Doesn't Google make must of its money from searching that web?

Well, yes, they do. But, as many have noted, most recently Jason Smith, Google's search monopoly is shakier than it seems. Apple has been bowed by dual attacks from Google and Samsung, but they are likely to strike back over the next year -- probably allied with Microsoft and perhaps Yahoo (but not Amazon). Apple will use its massive cash reserves to survive dropping Samsung manufacturing, and Apple will switch its default search engine to Bing.

Google knows this. 

Thousands of years of human warfare told Google how to respond. If an army cannot hold rich agricultural ground, it must burn it. Let the enemy eat ashes.

The web is a forest, and Google is burning it.

We do not understand the world in which we live

It is always this way, on the micro and the macro. I didn't understand high school until college. I didn't understand medical school until I was halfway through. I was deep into the corporation before I recognized my surroundings.

Did hunter-gatherers understand their context? 

Three links that tell us we don't understand ours (all via DeLong):

• The Singularity in Our Past Light-Cone 11/2010. " ... An implacable drive on the part of those networks to expand, to entrain more and more of the world within their own sphere? ... the radical novely and strangeness of these assemblages, which are not even intelligent, as we experience intelligence, yet ceaselessly calculating ..."
• Twentieth Century Economic History - DeLong: "... What do modern people do? Increasingly, they push forward the corpus of technological and scientific knowledge. They educate each other. They doctor each other. ... They provide other services for each other to take advantage of the benefits of specialization. And they engage in complicated symbolic interactions that have the emergent effect of distributing status and power and coordinating the seven-billion person division of labor of today’s economy...
• Algorithmic Rape Jokes in the Library of Babel | Quiet Babylon: " ... The Kindle store is awash in books confusingly similar to bestsellers... Icon’s books are created by a patented system... products that generate unique text with simple thesaurus rewriting tools called content spinners... Amazon ‘stocks’ more than 500,000 items from Solid Gold Bomb. These things only barely exist. They are print on demand designs... Talk about crapjects and strange shaper subcultures still gives the whole threat a kind of artisanal feel. The true scale of object spam will be much greater..."

In our work, our hive like human world, we seek those who know and do. Some hide themselves, some advertise. Some are specialists, some are generalists, a few are omni-talented. A very few are powerful, a few are powerless, most are in-betweeners. All are enmeshed in systems of symbiosis and parasitism, all embedded in the "novel assemblage".

This world seems strange to me.

It will seem quaint to whatever thinks in 2113.

Do evolutionary strategies evolve?

Biologists study evolutionary "strategies", such as r and K selection.

These are the strategies deployed the Great Programmer as she fiddles with the game states of the multiver... erkkk. Just kidding. These are, of course, human terms for the emergent phenomena of natural selection.

At a more granular level, a predator's niche might be contested on the basis of bigger teeth, stronger claws, faster moves, greater endurance, or bigger brains.

Likewise, microbes, who rule the earth, have a range of "strategies". Symbiosis, parasitism, fast reproduction, encysting and so on.

Presumably the catalog of strategies changes over time. Before there were teeth, big teeth strategies were not available.

Before there were neurons, big brain strategies didn't work.

So that leads to the obvious question, do evolutionary strategies evolve? That is, do new strategies emerge from variations of strategies such that the strategies themselves are subject to selection pressure (a sort of meta-selection I suppose)?

Seems an obvious question, but as of Sept 2012 Google has 9 hits on that precise phrase, none by biologists.

So I guess it's an obvious question, but maybe obviously dumb. I'm surprised though that I didn't find a blog post explaining why it's dumb.

(A bit of context, this came up in a discussion with my 13yo about what species would fill our ecological niche (global multicellular apex predator). Having hit upon the strategy of investing in brains, would natural selection keep returning to the theme?)

Why quality collapsed in the bubble years: Akerlof and the last good toaster

Six years ago, I mourned for the demise of the last good toaster. I could find lots of cheap toasters, but they didn't last long.

It wasn't just toasters. Between about 1999 and 2009 the quality of a lot of goods seemed to collapse -- even as consumer prices fell. I wrote cranky posts about the "occult inflation of shrinking quality", but I seemed to be a chorus of one. It wasn't just toasters that disappointed, we couldn't buy a decent DVD/VCR or pencil sharpener or window unit air conditioner. Similar quality problems emerged with drywall and heparin [1] and, notoriously, just about every computer manufacturer on earth save one.

For us it felt like a market failure. We were willing to pay more money for higher quality, but there didn't seem to be a relationship between price and quality. Brands like SONY and Panasonic didn't mean much any more.

A few brands kept their reputation. Canon and Nikon held on, and a phone maker led by a difficult genius made a reliable battery charger and eventually became the world's most valued corporation.

I wonder if it was Apple's example that changed the picture. Because reading John Roberts [3], it seems we fell into Akerlof's quality trap (emphases mine) ...

... Trade may break down almost completely (Akerlof, 1970). If eliminating the asymmetry of information is not possible, then buyers will refuse to pay more than the expected value of goods, averaged across the different quality levels they expect to be offered. Then the best quality goods may not be offered at all, because they command only a middling price that does not reflect their true value. Consequently the distribution of qualities that are actually offered is worse than what is potentially available. Since the selection of products on offer is not representative of the underlying distribution of quality, but is instead an adverse selection, buyers will rationally lower their willingness to pay even further. Then, even more potential sellers of relatively high-quality items may no longer be willing to sell at the lower price. The overall result may be that nothing but very low quality items are available -- only lemons are on offer -- and markets fail to exist for high-quality products, although buyers are anxious to have such goods and would willingly pay enough for them to compensate the sellers if they were sure to get what they paid for. [3]

In a world where quality seemed to be unobtainable at any price, Apple offered relatively higher quality [4] products at a relatively higher price. I think they broke the cycle [5]. It probably helped that after the debt/real estate bubble burst consumers paid more attention to the costs of unreliable goods.

It's quite a story - a textbook illustration of research that earned Askerlof a share of the 2001 Nobel Prize in Economics. So why haven't we read about this from anyone but a crankish blogger? Where are the economists?

[1] The investigation continues incidentally - More Suppliers Linked to Heparin Contamination - WSJ.com.
[2] I've been told that it's now very hard to buy a reliable dish washer 
[3] Roberts, J. The Modern Firm. Oxford University Press 2004. p 82-83
[4] Apple, with a few exceptions, doesn't make very high quality products. Their software is notoriously buggy, and they made generations of laptops with flaky hinges. Compared to the competition though, they were sterling. 
[5] The cycle-breaking alone brought them success, but the mind-blowing innovation of the iPhone and iPad took them to the top.

Update: Shortly after posting this, I discovered that in 2007 I made the same connection to asymmetric information theory that Roberts detailed in his text. Maybe I should have been an economist.

Rule 34 by Charlie Stross - my review

I read Charlie Stross's Rule 34. Here's my 5 star Amazon review (slightly modified as I thought of a few more things):

Rule 34 is brilliant work.

If Stross had written a novel placed in 2010, it would have been a top notch crime and suspense novel. Charlie's portrayal of the criminal mind, from silence-of-the-lambs psychopath (sociopath in UK speak, though that US/UK distinction is blurring) to every day petty crook, is top notch.

Stross puts us into the minds of his villains, heroes, and fools, using a curious 2nd person pronoun style that has a surprising significance. I loved how so many of his villains felt they were players, while others knew they were pawns. Only the most insightful know they're a cog in the machine.

A cog in a corporate machine that is. Whether cop or criminal or other, whether gay or straight, everyone is a component of a corporation. Not the megacorp of Gibson and Blade Runner, but the ubiquitous corporate meme that we also live in. The corporate meme has metastasized. It is invisible, it is everywhere, and it makes use of all material. Minds of all kinds, from Aspergerish to sociopath, for better and for worse, find a home in this ecosystem. The language of today's sycophantic guides to business is mainstream here.

Stross manages the suspense and twists of the thriller, and explores emerging sociology as he goes. The man has clearly done his homework on the entangled worlds of spam and netporn -- and I'm looking forward to the interviewers who ask him what that research was like. In other works Stross has written about the spamularity, and in Rule 34 he lays it out. He should give some credit to the spambots that constantly attack his personal blog.

Rule 34 stands on its own as a thriller/crime/character novel, but it doesn't take place in 2010. It takes place sometime in the 2020-2030s (at one point in the novel Stross gives us a date but I can't remember it exactly). A lot of the best science fiction features fully imagined worlds, and this world is complete. He's hit every current day extrapolation I've ever thought of, and many more besides. From the macroeconomics of middle Asia, to honey pots with honey pots, to amplified 00s style investment scams to home foundries to spamfested networked worlds to a carbon-priced economy to mass disability to cyberfraud of the vulnerable to ubiquitous surveillance to the bursting of the higher education bubble, to exploding jurisprudence creating universal crime … Phew. There's a lot more besides. I should have been making a list as I read.

Yes, Rule 34 is definitely a "hard" science fiction novel -- though it's easy to skip over the mind-bending parts if you're not a genre fan. You can't, however, completely avoid Stross's explorations of the nature of consciousness, and his take on the "Singularity" (aka rapture of the nerds). It's not giving away too much to say there's no rapture here. As to whether this is a Rainbow's End pre-Singular world … well, you'll have to read the novel and make your own decision. I'm not sure I'd take Stross's opinion on where this world of his is going - at least not at face value.

Oh, and if you squint a certain way, you can see a sort-of Batman in there too. I think that was deliberate; someone needs to ask Charlie about that.

Great stuff, and a Hugo contender for sure.

If you've read my blog you know I'm fond of extrapolating to the near future. Walking down my blog's tag list I see I'm keen on the nature and evolution of the Corporation, mind and consciousness, economics, today's history, emergence, carbon taxes, fraud and "the weak", the Great Recession (Lesser Depression), alternative minds (I live with 2 non-neurotypicals), corruption, politics, governance, the higher eduction and the education  bubble, natural selection, identity, libertarianism (as a bad thing), memes, memory management, poverty (and mass disability), reputation management, schizophrenia and mental illness, security, technology, and the whitewater world. Not to mention the Singularity/Fermi Paradox (for me they're entangled -- I'm not a Happy Singularity sort of guy).

Well, Stross has, I dare to say, some of the same interests. Ok, so I'm not in much doubt of that. I read the guy religiously, and I'm sure I've reprocessed everything he's written. In Rule 34 he's hit all of these bases and more. Most impressively, if you're not looking for it, you could miss almost all of it. Stross weaves it in, just as he does a slow reveal of the nature of his characters, including the nature of the character you don't know about until the end.

Update: In one of those weird synchronicity things, Stross has his 2032 and 2092 predictions out this morning. Read 'em.

Ants, corporations and the great stagnation

Do the great stagnation failures of the research enterprise and the modern publicly traded corporation have the same roots? Are not both ant-colony-like adaptive entities with emergent agendas of "their" own? An agenda to grow and survive regardless of the interests of their individual members or of their economic and human ecosystems?

See also

• Emergent computation -- the thinking world (Nature) 1/2004
• Malice, incompetence, and happy accidents 5/2011
• Why do corporations (firms) exist? 10/2010
• Speculation: The corporate ecosystem and American stasis 11/2010
• Why did medical progress slow after 1984? 12/2010
• Unemployment and the great stagnation 1/2011

PS. Extra credit speculation. Could these longterm trends be an independent contributor to the lesser depression? Independent of the macroeconomic disequilibria of disruptive globalization and IT innovation?

What Steve Jobs teaches about psyche and adaptive advantage

Steve Jobs bachelor party consisted of him, a reluctant Avie Tevanian, and one other guy. At that point in his life, he had no true friends. It's not clear how many he ever had, though he had many acolytes and several congenial colleagues.

He was a nasty person, though, like most of us, he improved somewhat with age. He never made it within two sigmas of decent however.

He was also a great gift to me and my family. We got the products of his company, without the displeasure of his companionship. It would, however, have been fascinating to observe his mind. It was extraordinary.

It was also completely unsuited to most of human existence. Even his powers of manipulation could not outweigh the enmity he created throughout most of his life. Were he born at another time, he would have likely died young. Throughout most of human existence his mind would have been a disability, not a gift.

There was a place and time where his mind was perfectly suited, and he had the fortune to be born to that time and to that place.

It's a good lesson on the distinction between adaptive advantage and dysfunctional trait. The distinction is not the trait alone, but its suitability to the environment.

It's also a lesson on the evolution of mind. Human minds are astonishing diverse; in physical terms it's as though a single species could have children with fins and children with wings. A winged mind flies in some times, drowns in others.

iPhone micro: How SMS pricing is accelerating the smartphone transition

I've been playing with a simplified model of the carrier-locked AT&T American 2011 iPhone marketplace. I think it makes some interesting predictions.

For the purpose of this discussion we'll assume that a minimal phone must include both:

• phone system compliant voice services
• text messaging: either SMS or non-SMS (example: Facebook Messenger, WhatsApp, etc)

We further assume that voice services cost the same for all phones, that iPhones are assigned AT&T's minimal $15/month [1] data plan and that SMS and non-SMS text messaging are equally valuable [2]

In this model there are only 3 phones:

• A: iPhone optimal - today that's the 32GB 4S.
• B: iPhone minimal - today the 3GS 8GB. This is similar to the 'A' phone of 2 years ago.
• C: pPhone: Plain Phone. Includes SMS and Voice but does not trigger AT&T's

So how do prices and lifespans break down, assuming phones are purchases with a 2 year contract, we get a new contract q 2 years, and the iPhones use non-SMS messaging ($15/month [3]) but the Plain Phone (pPhone) uses SMS ($20/month)?

• A: $300 + ($15 * 24) = $660.
• B: $0 + ($15*24) = $360.
• C: $0 + ($20*24) = $480.

Based on this simple model what can we say will happen to pPhones? Assuming a healthy iPhone can run for four years [4], then at the end of the 2 year contract, what is the rational selling price of a used phone?

Clearly, the pPhone should disappear immediately. It costs 30% more than the minimal iPhone, and it doesn't have apps, wifi browsing, video, calendar, pen light, quality camera, etc, etc. It has no resale value. (A bizarre conclusion, but it follows from the extraordinary high price of SMS services.)

Less obviously, the resale value of 2 year old iPhone is also quite low [6]. A formerly class B phone iPhone is probably no longer supported by Apple at that point and the formerly Class A devices set a low ceiling (below).

The formerly Class A iPhone at age 2 is a 'Class B' phone, but for a new-contract customer it has NO price advantage over a current generation Class B device. Both will cost $360 over two years. The only market for an out of contract 2 year old carrier-locked 'Class A' iPhone is to replace a lost or broken contracted phone.

That's worth something -- but there are a LOT of those 2 year old former Class A iPhones on the market. After all, in this model there's no rational reason to not have a data plan, and since a data plan pays most of the cost of a phone, everyone in this model gets a new phone every two years [5]. That means there's a glut of post-prime iPhones on the market.

If I new Class A iPhone has an initial purchase price of $300, I expect its value after two years to fall to about $70. Indeed, the primary market may be persons wanting a very cheap iPod Touch. Effectively the price difference between the Class B and Class A iPhones over two years is $660-$360-$70 or $230 -- which is what we pay for the storage capacity and features of the Class A device (well worthwhile for most of us).

In this simple model then, it's deeply irrational to buy a pPhone, one should not fear loss or breakage of an iPhone as there will be a glut of affordable used phones on the market, the value of an out of contract iPhone is going to fall, and there are good reasons to buy either a Class B iPhone (save $230) or a Class A iPhone (features, performance).

The real world is a bit more complex - but not much more complex. Data network based texting is not yet a full replacement for SMS texting for example. However, the future of SMS is very limited. An unintended consequence of carrier's addiction to SMS margins is that they're ferociously accelerating the transition to smartphones that will destroy those margins.

See also:

• Gordon's Notes: Remembering when the iPhone cost less (in 2008 texting was bundled)
• Gordon's Notes: The fear that's driving AT&T's smartphone data plan policies
• Gordon's Tech: Testing Facebook Messenger as a texting alternative (4 and 3G)

- fn -

[1] Note we're talking contract, so this is fair -- unlike AT&T's mandatory smartphone data plan for non-contract phones.
[2] Clearly SMS is superior at the moment, but this is going to change quickly. 
[3] I'm assigning the FULL cost of the data plan to non-SMS messaging. 
[4] Based on our experience, assuming even minimal care.
[5] That's probably too simplistic. A two year old former-Class A device may be superior to a new Class B device -- though not by much.
[6] Today businesses that buy used 3GSs are offering only $100 - for a device with an unsubsidized purchase cost of perhaps $300.  That's a very low price for a device that may be only two years old and can run iOS 5. It's so low because the primary market is small -- people who need to replace a lost contract phone or who want a 2nd rate iPod Touch (troublesome to activate, flaky iMessage performance, not truly supported by Apple). The market would be much larger if not for AT&T's carrier lock and mandatory data plan policies, and the price would be higher.

Update 11/26/11: A Felix Salmon Reuters post is a good complement to this article. It's a sign that the marketplace is beginning to think through the weird consequences of AT&T's contracts, all-smartphone-data-plan-mandate,  and SMS pricing.

Update 11/30/2011: added footnote [6] to clarify.

Too much history

One of the reasons I blog is to engage with a fascinating world, and to track the streams of history.

I'm finding that harder to do. It's not that I don't see the streams, or see ways to connect them -- it's that there's too much. I feel as though history just kicked up a gear.

Partly this is the loss of Google Reader's share/tracking functions. They were a key component of how I engaged with my fragments of the world's knowledge flow. Even if nothing else had changed, losing those functions and my share repository would be disorienting.

I don't think it's just the loss of Reader though. It's more that Reader's capabilities masked the rate of change. Without them, it's easier to see how the world is changing.

These are truly whitewater times.