The revenues of the top 5 US tech firms in 2018 exceeded the IMF's 2018 forecast for the gross domestic product (GDP) of Switzerland — a country of 8.5m people with an income per capita that is among the highest in the world. Amazon's high growth strategy focuses on high profitability in the long term; tax provisions in accounts may not correspond with what is paid while Microsoft's tax amount in 2017/2018 is not at a normal level. Alphabet is the parent company of Google.
Facebook's net profit margin of 45.5% reflects its near-monopoly position while not having to make capital investments on a scale with large non-digital companies.
Fifty years ago this year and just over 3 months after the first human walked on the moon, the first computer network message was transmitted in California between Professor Leonard Kleinrock's (born 1934) laboratory at the University of California, Los Angeles (UCLA) to another computer at Stanford Research Institute (SRI) in Menlo Park — a distance of 367 miles or 590 kilometres. This year is also the 30th anniversary of the launch in 1989 of the World Wide Web and the first website.
A 26-word sentence in Section 230 of the Communications Decency Act passed by the US Congress in 1996 was a huge gift to technology companies 7 years after the development of the World Wide Web.
“No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.”
In 2008 Eric Schmidt, then Google CEO, warned that the internet was fast becoming a "cesspool" where false information thrives. Speaking with an audience of magazine executives at the Google headquarters he said their brands were increasingly important signals that content can be trusted. "Brands are the solution, not the problem," Schmidt said. "Brands are how you sort out the cesspool" — from a clever guy this assurance on brands seems like self-interested bullshit.
When asked if print media hasn't the resources to pay journalists to create quality content, Schmidt said he didn't have an answer "but one thing to look at is whether journalism should be a for-profit enterprise."
Here we had the head of the biggest search engine raking in big advertising revenues while taking advantage of tax avoidance, mulling that high-quality content could be produced by charities!
In 2015 Eric Schmidt wrote in a New York Times op-ed, "Ever since there’s been fire, there’s been arson." After citing the good and bad on the Internet, Schmidt was optimistic:
"The good news is, it’s all within reach. Intuition, compassion, creativity — these are the tools that we will use to combat violence and terror online, to drown out the hate with a broadly shared humanity that only the Web makes possible. It’s up to us to make sure that when the young girl reading this in Indonesia on her tablet moves on from this page, the Web that awaits her is a safe and vibrant place, free from coercion and conformity."
Frankly, this was more bullshit as he avoided serious commitments from Google.
Last year BuzzFeed News reported on an internal memo that had been issued in 2016 by Andrew “Boz” Bosworth, a senior Facebook executive:
[On June 18, 2016, one of Facebook CEO Mark Zuckerberg’s most trusted lieutenants circulated an extraordinary memo weighing the costs of the company’s relentless quest for growth.
“We connect people. Period. That’s why all the work we do in growth is justified. All the questionable contact importing practices. All the subtle language that helps people stay searchable by friends. All of the work we do to bring more communication in. The work we will likely have to do in China some day. All of it,” VP Andrew “Boz” Bosworth wrote.
“So we connect more people,” he wrote in another section of the memo. “That can be bad if they make it negative. Maybe it costs someone a life by exposing someone to bullies.
“Maybe someone dies in a terrorist attack coordinated on our tools.”]
Then last Saturday (March 30) The Washington Post published an op-ed: "Mark Zuckerberg: The Internet needs new rules. Let’s start in these four areas."
“I believe we need a more active role for governments and regulators. By updating the rules for the Internet, we can preserve what’s best about it — the freedom for people to express themselves and for entrepreneurs to build new things — while also protecting society from broader harms.
From what I’ve learned, I believe we need new regulation in four areas: harmful content, election integrity, privacy and data portability...People around the world have called for comprehensive privacy regulation in line with the European Union’s General Data Protection Regulation, and I agree. I believe it would be good for the Internet if more countries adopted regulation such as GDPR as a common framework.
New privacy regulation in the United States and around the world should build on the protections GDPR provides. It should protect your right to choose how your information is used — while enabling companies to use information for safety purposes and to provide services.”
The call for governments and regulators to take action from the head of a big tech firm is dramatic as is the praise for the European Union's privacy rules.
In the past Facebook deliberately made it difficult to change privacy settings.
Mark Zuckerberg made a crazy claim after the November 2016 elections in the US:
“Personally I think the idea that fake news on Facebook — of which it’s a very small amount of the content — influenced the election in any way is a pretty crazy idea.”
He also said the company exposed its 1.8bn monthly users to various views, countering the criticism that Facebook has created a “filter bubble” of like-minded people. He said "the content is out there — but users don’t click on it."
Zuckerberg was in effect suggesting that thousands of targeted ads purchased by the Russian Internet Research Agency according to the Mueller investigation, were a waste of money.
Giant companies such as Facebook, Google and Twitter should have greater responsibility as publishers. They should also be subject to anti-trust actions where warranted (see below).
Facebook would like to hive off responsibility to regulators on what constitutes harmful content that should be deleted.
The digital platforms should be forced to exercise judgment and accept accountability.
According to Bloomberg, Roger McNamee, an early Facebook investor who’s now one of the company’s prominent critics, said in an interview that Zuckerberg’s proposal “would mostly absolve it of responsibility without addressing the underlying causes of election interference, hate speech, disinformation and the various privacy challenges that have emerged.”
McNamee, who is the co-founder of investment fund Elevation Partners Inc. and the author of the book 'Zucked: Waking Up to the Facebook Catastrophe,' pointed to the company’s plans to merge the data sets of Instagram and WhatsApp with Facebook’s, which he said “would greatly complicate the task of protecting users" privacy.
Congressman David Cicilline of Rhode Island who chairs both the Democratic Policy and Communications Committee and the House Antitrust Subcommittee, tweeted:
Rule #5 should be that Mark Zuckerberg doesn’t get to make the rules anymore. Facebook is under criminal and civil investigation. It has shown it cannot regulate itself. Does anyone even want his advice? https://t.co/HoHMZO0Iz6— David Cicilline (@davidcicilline) March 30, 2019
Big Tech unchained
Since the anti-trust action against Microsoft in the 1990s following the efforts to undermine the Netscape browser, US regulators have been in slumberland.
It has been argued that the action against Microsoft which had reached a settlement with the federal government, paved the way for the emergence of the likes of Google and Facebook.
"if you love technology — if you always buy the latest gadgets and think scientific advances are powerful forces for good — then perhaps you ought to cheer on the antitrust prosecutors. Because there is no better method for keeping the marketplace constructive and creative than a legal system that intervenes whenever a company, no matter how beloved, grows so large as to blot out the sun. If you love Google, you should hope the government sues it for anti-trust offenses — and you should hope it happens soon, because who knows what wondrous new creations are waiting patiently in the wings."
Google will reportedly pay Apple $12bn this year to remain as Safari’s default search engine.
According to Newsweek, sites and services owned and operated by Facebook and Google —such as WhatsApp, YouTube and Instagram — now account for over 70% of all internet traffic, compared to a joint market share of around 50% in early 2014.
Senator Elizabeth Warren argues that "Venture capitalists are now hesitant to fund new startups to compete with these big tech companies because it’s so easy for the big companies to either snap up growing competitors or drive them out of business. The number of tech startups has slumped, there are fewer high-growth young firms typical of the tech industry, and first financing rounds for tech startups have declined 22% since 2012."
Charlie Warzel, a technology opinion writer for The New York Times wrote in a piece titled 'Big Tech Was Designed to Be Toxic,' which was published on April 3, that Big Tech firms in effect have gone easy on extremism because it boosts growth:
"it’s true that the tech companies are dealing with thorny problems that most likely have no universally satisfying outcome. Big Tech’s problems are indeed dizzying and manifold, but the last few years have taught us that there’s an Occam’s razor quality to any explanation of the toxicity of our online platforms. The original sin, it seems, isn’t all that complicated; it’s the prioritization of growth — above all else and at the expense of those of us who use the services.
The most recent example came on Tuesday morning when Bloomberg News published a story chronicling YouTube’s struggles to quash misinformation, conspiracies and incendiary content. According to the report, current and former YouTube employees said that the company had ignored warnings to change YouTube’s recommendation engine and that they were, in some cases, discouraged from seeking out videos that might violate YouTube’s rules to preserve a sense of plausible deniability."
In 2017 a British House of Commons Home Affairs Committee report noted:
"It is shocking that Google failed to perform basic due diligence regarding advertising on YouTube paid for by reputable companies and organisations which appeared alongside videos containing inappropriate and unacceptable content, some of which were created by terrorist organisations. We believe it to be a reflection of the laissez-faire approach that many social media companies have taken to moderating extremist content on their platforms. We note that Google can act quickly to remove videos from YouTube when they are found to infringe copyright rules, but that the same prompt action is not taken when the material involves hateful or illegal content. There may be some lasting financial implications for Google’s advertising division from this episode; however, the most salient fact is that one of the world’s largest companies has profited from hatred and has allowed itself to be a platform from which extremists have generated revenue. (Paragraph 24)"
World's First Website: http://info.cern.ch/hypertext/WWW/TheProject.html
The World Wide Web
Tim Berners-Lee (born 1955), a British scientist at CERN, invented the World Wide Web (WWW) in 1989. The web was originally conceived and developed to meet the demand for automatic information-sharing between scientists in universities and institutes around the world. The first computer-to-computer link was made on ARPANET in 1969 -- which developed into the Internet.
CERN, the European Organisation for Nuclear Research/ Conseil Européen pour la Recherche Nucléaire is located at the Franco-Swiss border near Geneva.
CERN says the first website at CERN — and in the world — was dedicated to the World Wide Web project itself and was hosted on Berners-Lee's NeXT computer — which Steve Jobs was responsible for after leaving Apple in 1985. The website described the basic features of the web; how to access other people's documents and how to set up your own server. The NeXT machine — the original web server — is still at CERN. As part of the project to restore the first website, in 2013 CERN reinstated the world's first website to its original address.
On 30 April 1993 CERN put the World Wide Web software in the public domain. CERN made the next release available with an open licence, as a more sure way to maximise its dissemination. Through these actions, making the software required to run a web server freely available, along with a basic browser and a library of code, the web was allowed to flourish.
Sir Tim Berners-Lee, was a physics graduate working as a software engineer when he wrote a paper simply titled 'Information Management: A Proposal.' It said: “the hope would be to allow a pool of information to develop which could grow and evolve with the organisation and the projects it describes". The goal was “a universal linked information system” where “generality and portability are more important than fancy graphics techniques and complex extra facilities".
He was responsible for the HyperText Transfer Protocol (HTTP), HyperText Markup Language (HTML), and the first-ever web browser, WorldWideWeb. The web was initially named "Mesh" - - with "World Wide Web" being coined by Sir Tim in 1990. By 1993 Cern allowed the technology to be freely used by all.
DARPA was created by the US Department of Defense in 1958 as the Advanced Research Projects Agency (ARPA). The political and defense communities recognised the need for a high-level defense organization to formulate and execute R&D projects that would expand the frontiers of technology beyond the immediate and specific requirements of the Military Services and their laboratories.
The Arpanet (Advanced Research Projects Agency Network), which later would be named the Internet, was conceived in 1962 when, Dr. Joseph Carl Robnett Licklider (1915-1990) formulated the earliest ideas of global networking in a series of memos discussing an “Intergalactic Computer Network.”
The first-ever computer-to-computer link was established on ARPANET, the precursor to the Internet, on October 29, 1969.
In the mid-1960s, Bob Taylor (1932-2017) of ARPA from his Pentagon office, had contacted IBM and AT&T — two of the biggest US technology firms — to inquire whether they would be interested in developing a computer network system. "Can't be done " was the response.
Taylor then reached out to scientists at UCLA and SRI.
Charley Kline's work log Oct 29, 1969
Charley Kline a 21-year-old graduate student at UCLA, on the evening of October 29, succeeded in transmitting the word "LO" to the SRI computer before his computer crashed. He later that evening transmitted the word that he had intended to initially send, "LOGIN" — this is the first word transmitted over a computer network.
According to DAPRA:
"ARPA research played a central role in launching the 'Information Revolution,' including developing or furthering much of the conceptual basis for ARPANET, a pioneering network for sharing digital resources among geographically separated computers. Its initial demonstration in 1969 led to the Internet, whose world-changing consequences unfold on a daily basis today. A seminal step in this sequence took place in 1968 when ARPA contracted BBN Technologies to build the first routers, which one year later enabled ARPANET to become operational."
The Facebook Dilemma, Part One and Part Two, 2018