Month: December 2020

It seemed to start so innocently. A way to create a online profile, connect with old friends, see what they were up to and how they had changed or not changed since high school. Frankly it was one of the things the internet was made for. The ability to connect people, regardless of location, just internet access required. One of the first social media platforms was MySpace, whom I visited after they were purchased by News Corp (one of my accounts at Microsoft). By that time they were already on a downward trajectory soon to be replaced by a upstart originally based in Harvard, which has gone on to become a technology giant, Facebook. Most people at one point or other have had an account, and judging by the daily activity on Facebook it is a core part of people’s jobs (do not ask my how I know this). When people go on vacations, though envious of the locations, I am left wondering are you truly enjoying your vacation or just posting on Facebook to sooth your ego? One thing is clear is Social Media has become a large part of the human DNA. We are always connected. With that fame has come consequences and new responsibilities, some that have gone into areas new to companies that for the most part have targeted the consumer space, but whose reach now threaten our democracy (or our Republic for constitutional scholars).

There are a lot of social media companies now, Facebook, Twitter, Instagram, SnapChat, TikTok, etc.. With new ones being created and coming online all the time. Some targeting different age groups. More and more using video content. A lot of the content meant to make us laugh, to cheer us up. When loved ones get ill or pass, we often hear about it first on social media platform. A child’s birth, first steps, first birthday, graduation, wedding etc..we can practically see an entire life unfold online This is a positive side to social media, the one we would like to believe in. There are positive social benefits to society, despite negativity, it helps during a crisis. A missing child, local police activity and areas to avoid (or help the community can provide). We are now connected in real time, all the time. We can react to events quickly in ways not possible before.

Somewhere things started to change. Some within our borders, some outside our borders. The election of 2016 will be remembered for a lot of things, and it was certainly not the beginning of the negative political discourse that the country had been undertaking. That has been going on for decades, but social media gave it a new voice. It has always been a challenge with the internet that people anonymously feel they can say whatever they want, not matter how vile, disgusting, threatening and get away with it with no consequences. More importantly it has turned people against one another, you continually hear about families divided. The driving force behind this was something simple: truth. The problem being is the age old question of “what is truth”? You would think it would be facts. We now have alternate facts (thanks Kellyanne). We gravitate towards those we are in agreement with and agitate those we have disagreements with.

Outside our borders our Social media platforms became a target of manipulation, a way to amplify negative aspects of American Democracy. The Russians for example have the Internet Research Agency (IRA) based in St Petersburg, Russia. The claim is it is a privately held company funded by a Russian oligarch. The reality is whatever its charter, it is their specifically to cause disruption in western democracies. It highlights a new challenge to national defense, For a foreign agitators to threaten the US it no longer requires billions of dollars spent on developing a nuclear weapon (though they still try, like North Korea and Iran) . All you need is a few really good hackers, some laptops and high speed internet connections and you are good to go. You now get into questions with Social Media companies about data and privacy. It gets into the area of what do you want government to have access to, which for some creates immediate paranoia. Edward Snowden certainly did a lot in amplifying this new state of mind. For countries attacking the US it seems since 9/11 the goal has been to upset the American economy and make Americans suffer like some third world countries do. Using Social Media has seemed an effective way to do this, though so far it has yielded limited results. America already has a huge population suffering, but that is a topic for another day.

One thing that was inevitable as social media juggernauts became responsible for monitoring their users (aka President Trump cannot just make stuff up and call it truth), was there would be a response. One such response was to Twitter, with the alt-right social media provider, Parler. I created an account to check out the service for “free speech”. It has provided a home for such outlets as Alex Jones -Infowars (their site lists everyone who banned them – which was everybody), ProudBoys, Qanon, KuKluxKlan, etc..Between signing up for a Parler account and finding all these abhorrent racist sites took all of 3 minutes. The thing about the web is it is hard for anyone to be silenced, no matter how hard some may try. One thing many have been concerned about is isolation. This will be the challenge with Parler (it easily could be an extreme left site, Twitter would not be extreme in my view), but voices raised and left unopposed leads to violent outcomes. We get so bombarded with social content, much of which makes us emotional, we seek out friends and websites that make us feel good and are in alignment with our beliefs. We simply shut out those we do not agree with, even if they have legitimate grievances. We cease to listen.

There is a lot of discussion around Section 230 of the landmark 1996 Communications Decency Act. The President would like it removed, because sometimes things he says are deemed false information and flagged as being false (by Twitter). Twitter cannot be held liable thanks to Section 230. If we take a more extreme example if someone provides a link to adult content or an extremist act of violence these should be removed by the content provider as they will be offensive to many and in many instances will be viewed by minors. On this I will argue that Section 230 serves a very important purpose, maybe even more so now in a time when finding truth can be very difficult On social media platforms in May of 2020 they were forced to remove a documentary video by anti-vaccine advocate Judy Mikovits, who said a flu vaccine from 2010 is driving pandemic, masks will activate spread COVID-19 and Dr Anthony Fauci should be tried for treason etc… There were no sources for this, just an interview. The claims by Ms. Mikovits, though ridiculous, had a very large following and leads to a kind of social panic. It highlights a challenge with social media – conspiracy theories spread like wildfire. It reminds one of the impact Radio had and Orson Welles broadcast of “War of the Worlds” which caused a mild panic. The ability to reach tens of millions in under a day in the true test of Social Media platforms

I do not envy the leaders at Social Media, having to create guidelines on what can be posted and what cannot and not seem to come across as violating our first amendment rights. They also must work with government and negotiate what data to provide government and what is a violation of peoples privacy. In the end it seems like a mission designed to fail. If I post a blatant lie and the President posts the same blatant lie, those are not the same thing, simply because I do not have a lot of followers and the President has tens of millions of followers. Does Twitter or Facebook treat these equally? Or in terms of today’s Politics when a group feels slighted do they create a new social media platform and how far do they go left or right before it becomes dangerous? One of the biggest threats the United States will face in the coming years is not from abroad, but internally: domestic terrorism. Social media platforms will likely be a huge enabler. This will require Social Media providers to work with both federal and local law enforcement. This comes at a time when many people view government with distrust (I view Russia with distrust but I guess I am a minority). It is a immense responsibility and enormous challenge to be held accountable for the truth and still make a profit. It is the American way.

Good Night and Good Luck

Hans Henrik Hoffmann December 29, 2020

I will be honest – I don’t like cars. I find them a bad investment, constant repairs, insurance payments, traffic jams, playing to people’s shallow vanity, as I get older my eyes are not as good and I do not like driving at night. In all honesty…they suck. Luckily there is good news on the horizon for people such as me, the world of autonomous vehicles is upon us. It is not something that has just spring up the in the last several years efforts have been underway for sometime. One of the primary drivers of this has been the US government through the DARPA Challenge. I first read about the DARPA driverless car competition back in 2004. This was a off road competition held on the California/Nevada border. It would take a few years but it was quickly mastered. The competition for these event usually come from the top universities in America such as MIT, Carnegie Mellon, Stanford etc… The next autonomous event would be around streets – simulating a city. This event was excellently recounted in Lawrence Burns fantastic book, Autonomy: The Quest to Build the Driverless Car – and How It Will Reshape Our World . Needless to say it ended in success and it has been over ten years since this challenge, as like everything in tech it did not stop but spurred investment from the private sector. Google Moonshot was one of the first, and now there are dozens of companies investing in this field.

There are a lot of efforts currently being undertake and to build and deliver an autonomous vehicle right now by a variety of companies. We have the well known one, Tesla – but pretty much every automaker is working on a autonomous vehicle. Weather it be Ford, GM, Toyota etc..if you get anyone of those vehicles today they have a lot of features to help you navigate the road without having to touch the wheel – think new and improved cruise control. then there are ride sharing services like Uber (Uber just sold off their autonomous while work to Aurora) and Lyft who both have autonomous vehicle projects in the works. Then there are the “science projects” which includes the likes of Apple. There area lot of new companies coming out of the woodwork, in particular focused on long haul trucking. This makes a lot of sense as these routes are across America in long straight roads, companies like Kodiak Robotics and Nikola have focused on this area. Amazon acquired self driving taxi service Zook last year and is pushing ahead with plans to launch service. What it all adds up to is the fact that the race is on. A race in technology means one thing: A whole lot of money is being invested and about to be invested. Investors typically want to see a ROI on these investments.

Power will be big as companies look beyond oil. The current debate seems to have come down to two technologies: Lithium Batteries and Fuel Cells. The era of Big Oil is coming to an end, though it has a fascinating history, worth checking out in Daniel Yergin’s seminole book The Prize . The battle has begun with Tesla leading the way. The biggest challenge with these new forms of energy is not the technology, but the infrastructure to support them. Today if you are driving across country and need to refuel you just stop at the nearest gas station. This is made easier by services like Yelp or Google. Find the nearest station when you are in South Dakota and continue your journey. If you are driving a Tesla finding a charging station in Seattle is one thing, where they are rather plentiful, Finding it in Cheyenne, WY will be a little more difficult, not to mention all the land that lies between Seattle and Cheyenne.

I understand there are plenty of skeptics about autonomous vehicles, those that believe it is a pipe dream that will never happen. Those so attached to their vehicles and the perceived freedom it provides. God know how many houses I have seen with beautiful BMW’s in the driveway, but mowing the lawn is a challenge that is beneath the owner of the home. From a tech perspective this is not that hard to understand. the desire to have a vehicle navigate streets and all it’s unforeseen hazards Children running in the streets, dogs chasing balls, trees falling in storms, construction ongoing and ever changing etc..It may seem these cannot be overcome, but in the tech space these are merely technical challenges and in technology these challenges are always welcomed with open arms. Companies that avoid these technical opportunities will greet failure with open arms. In the technology space a technology challenge is just plain exciting. The opportunity to create a new more efficient modes of transportation, while using new cleaner, greener forms of energy is just too good t0 pass up.

It was Bill Ford, of Ford Motor Company who said over a decade ago that the automobile is no longer just a mode of transportation, it is a platform. Sounds more like a Tech CEO, but he was absolutely right. When I was young when you lifted the hood of a car you could see the motor and through many gaps you could see the road beneath it. Now you lift the hood of a vehicle there is just a lot of stuff. What you do not see, but it is there, and it is something more important than oil was to the combustion engine. It is data. Autonomous vehicles live in the world of algorithms and AI. They will pull information from GPS, analyze every turn at a street corner, understand merging onto the freeway at the right speed and the right distance, understanding the right route, and most importantly understanding the unforeseen variables that arise from nature and human interaction. At first there will be mistakes, but AI is a learning mechanism over time each variable will be understood, algorithms will be tweaked and autonomous vehicles will be improved. If you think about it whether you are driving a Tesla or hailing a ride share service, such as Uber or Lyft a lot of data is being collected.

The vehicle of the future may not be two seats in front and two seats in back (I just ran this by my wife, she is not into this idea). The Amazon Zoox Autonomous vehicle has seats facing one another. As we get more comfortable with self driving vehicles the vehicles themselves will get more comfortable. I could see a festive atmosphere to come in the car of the future, my self driving car will have a self driving bar (no fear of DUI’s anymore…lives saved). The vehicle of the future will not be limited in design, it will lead to an explosion in design. It could create a new field for luxury autonomous vehicles. Whether you will own them or will it be a service is still open to the market debate.

There will be issues. There will be tragedies. It is the price of progress. In fact there have already been some recorded deaths due to people trusting current vehicles autonomous capabilities too much. However the age old technology adage is in play, “we overestimate what we can accomplish in two years and underestimate what we can do in ten”. There will be countless deniers. Some will cling to their trucks for dear life, they will be taken advantage of by insurance companies who will charge exuberant prices for auto insurance so they can protect their precious civil liberty (capitalism loves a sucker, I look forward to taking your money). Make no mistake autonomous is happening. It will shape our lives. It will shape our future. It is coming faster than many expected. No more drivers ed. No more DUI’s. No more speeding tickets. No more being stuck in traffic and suffering from road rage. The benefits are endless. The lives saved countless.

Good Night and Good Luck

Hane Henrik Hoffmann

There has been a lot of “monopoly” talk of late. Companies like Google, Amazon and Facebook in particular. They have created such scale that it is feared they can crush competition that enters their domain and use their financial strength to extend their reach into new domains. As is customary in America where there is great wealth, there is great power and the desire to question that power. Which is where the Department of Justice comes into play. They start raising question such as, “Has the competitive playing field been reduced”? Is just one company determining the playing field? Are these companies practicing anti-competitive methods in order to prevent or crush competition?. This goes all the way back to the the Sherman AntiTrust act of 1890, under the legendary leadership of President Benjamin Harrison (ok – who out there knew this fact? As a fyi, President Harrison is not considered legendary). The Sherman Antitrust act would only really start being used in-force under President Theodore Roosevelt (he was a legend). We have a history of making sure market power does not get consolidated to one company. We are a competitive nation, monopolies tell us a business has won, America says great, we now need to break you up and create a competitive marketplace. Capitalism and market dynamics are part of the American DNA.

The DOJ is not new to me, as for a while it was a dominant part of my life. After the launch of Windows 95 at Microsoft things started to change, specifically as it related to the emerging Internet Browser wars. As usual when it came to competition, Microsoft was laser focused and at that time it was a little company called Netscape that raised our ire. A little internal memo suggested that Microsoft make the browser a standard part of Windows, which had 90% market share at the time (I think it still does). All PC’s that shipped would come with Microsoft’s Internet Explorer. Microsoft was leveraging its greatest asset, Windows, to squash little old Netscape. Marc Andreesen had stated earlier that the graphical browser would become the dominant user experience reducing Windows to “a buggy set of device drivers”. The war was on and Netscape knew it could not compete with Windows when it came to distribution, market share and the fact that Microsoft made the browser free. The rest is history and I shall not regurgitate too much.

One thing I will say is during the crisis the joyful youth and passion of Microsoft employees was changed forever. Steve Ballmer told everyone at the company to not focus on the trial, but focus on their day to day work. This proved an impossible task. In an interesting twist of fate Microsoft was out PR’d by the Justice Department. The duo of Joel Klein and Janet Reno seemed like they were always on the offensive and Microsoft was always playing defense. In reached a head when during one company internal meeting with leadership an employee commented, “What is going on? I do not even recognized this company being portrayed in the media”. The DOJ had succeeded in putting Microsoft into a very negative light. It was a hard lesson. We got cornered and lashed out like a wounded animal but the damage had been done and the DOJ won the day. For many Microsoft employees who were passionate about the company and the rapid pace of change we were stoking it was a painful experience, but a lesson learned. In many ways the rise of FAANG (Facebook, Apple, Amazon, Netflix and Google) has been great as it has turned the focus away from Microsoft.

When I look at the current set of anti-trust candidates, they are all pretty much in the same part of their business lifecycle as Microsoft was when we were taken to court. Still young but becoming middle aged. Publicly traded companies with high flying stock prices. They have CEO’s that are cultural icons as they amass wealth beyond the layman’s comprehension. A billion dollars is frivolous spending money. They are arrogant and believe they will pave the way for the future of the global economy. They see the world through the blinders of their corporate prison. See no wrong, do no wrong. How can people possibly be opposed to us? We are the good guys and gals. But if we peel back the layers of the onion it becomes apparent that there is reason for concern.

If we look at all three companies in question one thing they have in common is data. And not just a little bit of data but exabytes and beyond (next up zettabytes, than yottabytes). More importantly they know how to use that data and manipulate it to their financial benefit. Most importantly that data is about you, the individual. The ability of these companies to harness, analyze and target you as an individual at breakneck speeds is unparalleled in human history. If I buy soccer shoes for my kid next thing I know on my Amazon page I have ads for soccer shoes or soccer apparel. A similar company trying to sell me soccer gear is at a significant disadvantage. Even if they have data and can write great algorithms they are at a significant disadvantage. You need data and the more data the better, this becomes paramount as we are now in the era of AI. Data is the fuel AI needs.

Each company had different anti-trust challenges. In Facebook’s case it may be a bit different. We learned in the 2016 Presidential elections tha social media can be manipulated by “bad actors” – namely Russia, but there are others (China, Iran, etc..). Facebook has become a national security issue and based on its business practices the arbiter of truth. Because of its scale each day millions of voices are heard and to be honest many in rage, some following down ill advised conspiracy paths. There is a ton of noise on social media. The lines of the public sector and private sector have crossed over and become rather blurred. Watching Mark Zuckerberg testify before congress (via Zoom) was in some ways uncomfortable, but he did acknowledge there is a role for government to play, while maintaining our first amendment rights. It has created the question of Facebook being the arbitror of facts. There are extreme organizations that (left and right) use Facebook to spread doctrine and “alternate” facts and Facebook is left to decide who can post and what they are allowed to post. In the end they are left with the worst case position of acting as political supervisors. They have to determine facts and when is what is being spread hostile and when is it humorous. They are being asked to a responsible and credible news organization, when nearly all content is supplied and distributed by ordinary people. I do not know how this story will play out. One thing we do know is social media is being used and played by bad actors to spread divisive and harmful information.

Amazon is a different story. We think of them as the book seller turned ecommerce giant, and then for kicks, started the whole cloud computing phenomenon. My take on Amazon is maybe a bit different. For a while I have thought they are the supply chain company. The old business adage is “building a product is easy, building a supply chain, now that is hard”. Amazon seems to revel in looking at their suppliers and ask the simple question, “why are we paying them? Can we do it better?”. During Covid-19 on my street it seems an endless stream of Amazon Prime delivery trucks are going by my house. If I go to the airport I see Amazon Prime Planes. This is all business that used to belong to FedEx and UPS. A thing to admire about Amazon is for all the cash they bring in they have never seemed interested in piling up cash like Apple, Microsoft or Google. They re-invest in the existing business and the opportunities to create new businesses. They are a hyper aggressive company. This of course has brought them into the cross hairs of the DOJ. In a lot of ways Amazon offers the simplest of solutions just break up eCommerce and Cloud. They would still both be behemoths in their perspective markets. During a crisis there are winners and losers. COVID-19 has been a great opportunity for Amazon to dominate the industry even more. They crush small business like ants. With small businesses dying, Amazon is thriving.

Google has been in the lead of search for some time and in mobile search it is clearly the dominant player with 95% market share. The DOJ brought a lawsuit against Google back on Oct 20th. Google has owned search for a couple of decades and have amassed a dominant position in the industry. They are part of the FANG group of stocks that seemingly drive the tech market. They are so prominent that “Google” is a verb. They built the search business model that left everyone scrambling to catch up. They have built up vasts amount of cash and more importantly are the search engine of choice out of habit. Habits are difficult to change. Even more difficult to regulate. There are alternatives out their to Google Search, such as Microsoft’s Bing, but even Microsoft with all its financial resources has not been able to crack or even dent the market share in search that Google has. You would have thought that Apple would have scrapped Google for Bing, given Steve Job’s loathing of Google, but at the time (before Job’s passing) Bing was in no position to compete with Google and for Job’s user experience trumped everything. Can the government break up Google? Force mobile phone providers to seek other search partners (hard given many are not US Companies)? Governments regulating and defining free markets is dangerous, but free markets are not saints, they are more Darwinist in their approach. Those they crush are just a lesser species.

With all the litigation going on what should these companies do? From experience I would say: cooperate. Microsoft in its youth and arrogance fought the DOJ. Thinking we would win on our technical merits and business acumen. We thought the public was on our side until they were not. A second thing is do not underestimate the ability of the DOJ. They are pro’s and they will have witnesses, primarily academics and your competition. The DOJ has been thinking about the case long before it ever became public. Do no make it a contentious case, because it will not only affect public perception but employee moral. It is a delicate balance in a hyper competitive industry, you do not want to pull your punches, but you need to continue to move forward.

What will the government do? The lines in the industry are much more opaque than they were 20 yrs ago, because those lines do not reside within borders. They live in the cloud we call the internet. If the government went draconian and came down really hard on Google, who says Bing would bick up eth scraps? Maybe an unknown competitor in China would prove to be the best? Russia? And then you get back to the issue of data. Where does it reside. The DOJ is treading a fine line, this is not like the easy old days of AT&T where you are talking a physical separation of a company that resides within US borders. Even if you broke up any of these companies there is no saying its popular replacement would be a US based company, because it would be on the web and not as predictable of an outcome.

Good Night and Good Luck,

Hans Henrik Hoffmann