ALPHABET ASCENDANT: Google’s Path to Exponential Growth

ALPHABET ASCENDANT:  Google’s Path to Exponential Growth

For this post, I thought I would look into Google, which along with Apple, is an indispensable part of my life. Google is my constant companion, I am totally reliant on it, and it shadows me. Like many people, I use Gmail for my personal e-mail and along with 90% of Europe I search the Internet using a Google search engine, usually Chrome. I watch music videos on YouTube and have given up London Black Cabs for Uber (a Google investment). I find out where I am going with Google Maps, and often use Google Translate to make my work easier. My kids use Google docs to do homework at school. Even back in 2005 after Hurricane Katrina, Google Street View helped us monitor the flood situation on my parent’s street in New Orleans. And since I started this blog about technology Google – or more accurately Google’s new parent company Alphabet – features in just about everything I read. I am not complaining because I find these products and services helpful for my life; however, I have started to wonder just how wide is Alphabet’s reach? And more broadly, how has it been possible for just a few tech giants – we all know them: Google/Alphabet, Amazon, Facebook and Apple – to acquire such dominant positions in the global tech marketplace?

Alphabet’s Audacious Ambition

Each of these companies has evolved in its unique way and each offers consumers slightly different products and services. They also compete in certain areas, particularly Google. Google’s Android is the biggest competitor to Apple’s IOS mobile operating system. Google+ is trying to give Facebook a run for its money in terms of social networking. Google is investing heavily in Cloud computing, where Amazon is currently winning.  There is also Google TV to rival Apple TV, etc… I am intrigued by Alphabet’s ambition.

Alphabet, which in 2016 briefly surpassed Apple as the world’s most valuable company in terms of market capitalisation (reaching $550 billion in February 2016), has companies across diverse yet inter-related businesses, the outputs of which reinforce and strengthen each other. These include Internet services, life sciences, robotics and artificial intelligence, smart home technology and fiber optics, to name just a few. Many of these businesses track our personal data as we engage with them, and we have no choice. When Google was recently required to change its privacy policies in Europe, it made all of its users consent to the new policies before we could access Chrome (so I did). Alphabet has such a vast amount of information about all of us that I find it hard to comprehend. This data – one of Alphabet’s most valuable assets – can then be processed, analysed, sorted, compared, and ultimately shared with other companies within the Alphabet conglomerate. What does it mean for one company to have so much information, so much money, so many investments, and by extension so much influence over our lives and our children’s futures?

Before I go on, I want to recount a conversation I had with some of my family members while on holiday in Florida last week.   These guys were very early tech and robotics pioneers and have ridden the tech wave over the past two decades. They know a lot about this world, which I am only just exploring. So, I asked them what they thought about Google, framing the question in the way that I feel about Google:

Me: “Don’t you think its crazy how Google has become so dominant across the entire tech sphere? I can see Google’s handprint on everything from e-mail to search engines to big data to robotics to the “internet of things” to self-driving cars to outer-space research to the most advanced position in artificial intelligence, and I don’t even know if I’ve scratched the surface. Don’t you think that’s bad?”

Them (paraphrasing): “Nah, Google is just dominant now like Microsoft was in the 1990’s. Just wait until someone comes up with a better idea or better ways of doing things and Google will get supplanted just like any other company.”

Really? I thought that was so interesting. First, I think this exchange demonstrates the differences in mind-set between people “in the know” that is, people that live and breath tech and don’t feel threatened by it, and outsiders like me. Second, it made me very curious if they could be right. If they are, it is likely that the powers- that-be at Alphabet have this very same mind-set. They know that they could be supplanted and they are doing everything they can to make sure that this does not happen. That is the theory I am pursuing. According to one article I read, Google has been acquiring companies at a rate of one a week since 2010. Alphabet’s venture capital and investment funds allow them to take a piece of anything and everything that might be the “future”. And, they have the largest lobbying budget of any tech company. In 2015 they spent $17 million on lobbying efforts in the U.S. alone.  In my mind this is a company that is not only determined to survive, but single-mindedly set on retaining its dominant position.

Which brings me to a question that some of you may be wondering. Why isn’t Alphabet’s ascendency (and that of the other big tech companies) somehow kept in check by anti-trust or competition laws in the U.S. or Europe?

Competition Laws and the Big Tech Firms

The reason that Alphabet and the other big tech firms can be so dominant is because dominance in and of itself does not violate competition or anti-trust laws. These laws are designed to accomplish two general goals: (a) to limit anti-competitive behaviour between companies within a given sector (including blocking mergers between companies if the merger would result in severely limited consumer choice), and (b) to ensure that where a company has a dominant position within a sector, that position is not abused, particularly in a way that harms consumers. These laws do not protect competitors. Indeed, protecting competitors rather than consumers through competition law is viewed as perversely punishing successful firms. Championed by the Chicago School of Economics this economical-based interpretation of competition law is prevalent in both the U.S. and Europe. This approach considers issues like economic efficiency, consumer welfare and market access rather than size when determining whether there has been an infringement.

There is an anti-trust action against Google currently underway in the European Union. Google is accused of abusing its dominant position by favouring its own shopping price comparison service on its web pages by steering consumers to their pages rather than to the pages with the best prices.   For information about this case see this link: (http://www.europarl.europa.eu/RegData/etudes/BRIE/2015/565870/EPRS_BRI(2015)565870_EN.pdf). Google has countered that the suit is “wrong as a matter of fact, law and economics.” (https://www.theguardian.com/technology/2015/aug/27/google-attacks-brussels-antitrust-case-european-commission-shopping-price-comparison).

I question whether this purely economical approach to competition law is sensible when applied to today’s tech firms. These firms have access to vast amounts of data and information about everyone that uses their products and services. They can exploit this information to pursue their own ambitions in a way that we have never seen before. In my view this gives them an enduring unfair advantage over anyone wanting to compete in almost any area where this information gap is relevant. It is also harmful to consumers who have little or no control over how their information is being used. But these issues do not currently figure into the analysis.

What Alphabet Owns

Because Alphabet is acquiring new companies and expanding into new sectors at a very fast rate, it is not easy to put down on paper what it owns without being immediately out of date; however, this Wikipedia link may be helpful as a reference since it is often updated. (https://en.wikipedia.org/wiki/List_of_mergers_and_acquisitions_by_Google).

Also, above is the best schematic that I could find that shows Alphabet’s corporate structure, and how some of Google’s largest acquisitions have been separated into independent subsidiaries of Alphabet.  (http://uk.businessinsider.com/googles-ten-biggest-acquisitions-2015-1?r=US&IR=T). This schematic (found that http://arstechnica.co.uk/gadgets/2016/02/alphabets-market-cap-tops-apple-is-now-the-worlds-most-valuable-company/) does not tell the whole story because many of these Alphabet subsidiaries have multiple (at times literally hundreds of) subsidiaries of their own. Nevertheless, here is my best effort to describe the incredible, ever-growing, world of Alphabet. I have also provided web addresses for these companies if you would like to know more.

GOOGLE – INTERNET SERVICES & MOBILE OPERATING SYSTEMS
http://www.google.com/about/

Google is the most well-known Alphabet subsidiary and the one that accounts for most of its revenues (approximately $74 billion in 2015).  Google covers broadly its internet services businesses and mobile operating systems including Android (the world’s most dominant mobile operating system); the search engines Chrome and Safari; email Gmail, video streaming YouTube; various Apps for Android available through Google Playstore.  It also includes Google’s advertising service Adwords and other products like Google Maps, and Google Street View. When I searched for a list of Google subsidiaries I found a list of about 50 companies, including non-Google names like Doubleclick; AdMob, and Zagat; and the Google subsidiaries in China, Japan and Korea, among others.   You can have a look here:  (https://www.google.co.uk/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=google+subsidiaries&stick=H4sIAAAAAAAAAOPgE-LUz9U3MDFNNk_S0swot9JPzs_JSU0uyczP088vSk_My6xKBHGKrYpLk4ozUzITizJTiwHHENo-OAAAAA).

While Google is dominant in the Internet search engine sector and it sometimes seems like the only one (Chrome was the default browser on my computer and many websites only open properly when opened in Chrome), there are alternatives. This site lists the most popular search engines: (http://www.ebizmba.com/articles/search-engines).

Likewise, while Android is the dominant mobile operating system, Apple’s IOS and several others on this list are providing competition and thus consumer choice: (http://www.shoutmeloud.com/top-mobile-os-overview.html).

ACCESS: FORMERLY GOOGLE FIBER
https://fiber.google.com/about/

To improve access to the Internet (so more people can browse!), Google is expanding rapidly into fiber-optic broadband in cities across America. Fiber provides superfast Internet, TV and phone services.   Launched in Kansas City in 2011, Fiber is now found in at least nine cities in the U.S. in states like Georgia, Texas, North Carolina, Tennesee and Utah.   For more on Access/Fiber: (http://recode.net/2015/11/30/meet-google-alphabets-access-and-energy-division-home-to-google-fiber-and-a-favored-exec/).

GV: FORMERLY GOOGLE VENTURES
http://www.gv.com/portfolio/

According to their website, GV “seeks to invest in startup companies in a variety of fields ranging from Internetsoftware, and hardware to life sciencehealthcareartificial intelligencetransportationcyber security and agriculture.”

 They are doing a lot of investing. The GV website lists over 200 companies in which it has invested.   There are many unknowns (to me) as of yet, and many well-known companies like Uber, Slack and Homeaway.

For more about GV see: (http://recode.net/2015/12/06/google-ventures-owns-part-of-several-unicorns-but-the-biggest-and-trickiest-is-uber/) and (http://www.fastcompany.com/1826876/googles-creative-destruction).

GOOGLE CAPITAL
http://www.googlecapital.com

Google Capital is an equity investment firm that invests in growth-stage firms rather than startups like GV. According to its website they: (1) seek out “disruptors”, (2) invest long-term and (3) think and look globally. While these investments are supposed to be profit-driven rather than strategic, there appear to be many synergies between the companies that Google Capital invests in and the Alphabet companies themselves. This allows the new companies to benefit from the vast Alphabet expertise, and almost guarantees success of the new companies.

Some of Google Capital’s companies are well-known and come from a range of industries, including LendingClub, Survey Monkey and Zscaler. For more information: (http://recode.net/2015/12/21/meet-google-capital-the-investing-arm-with-the-keys-to-the-googleplex-kingdom/).

NEST – Smart Home Technology
www.nest.com/uk/about

Nest is Alphabet’s foray into Smart Home technology and the Internet of Things and was Google’s largest acquisition that is now a stand-alone subsidiary of Alphabet. Currently NEST’s main products are the smart thermostat, smart smoke detector and security cameras. Rather than make more home products, Nest apparently plans to focus on improving the software/communication standard behind this home connected technology, which is not yet evolved sufficiently to permit the market to develop. Here is more information on Nest: (http://recode.net/2015/11/22/alphabets-bets-nest-the-long-game-on-the-smart-home/).

X: FORMERLY GOOGLE X
https://www.solveforx.com/

X is by far the most interesting, exciting and eyebrow-raising companies within the Alphabet conglomerate. Google X or X or Solve for X (I like that one) is where Alphabet has placed Google’s “Moonshot” projects. These are epic, mysterious, life-changing and audacious projects meant to disrupt just about everything as we know it.

The main Moonshot projects include:

(1) Self-driving Car Project;

(2) Project Wing (developing a drone delivery service to rival Amazon Prime Air concept);

(3) Project Glass (I am not sure if this has been spun out of X, but it is the project developing Google Glass, the hands-free, voice-activated computer mounted in a pair of glasses.);

(4) Project Loon (developing a network of Internet-connected balloons to be launched into the earth’s stratosphere, which would bring Internet service to everyone, rivaling a similar concept of Facebook);

(5) Replicant (developing robotics technology; until recently the home to Boston Dynamics and the controversial Atlas Humanoid Robot); and

(6) Makani (developing clean energy solutions, specifically wind turbines).

Here is a must-read article about Google X and its “Captain of Moonshots” Astro Teller (I am not making that name up.): (http://www.fastcompany.com/3028156/united-states-of-innovation/the-google-x-factor#15).

Much of what happens in Google X is unknown to the public at large.

CALICO AND VERILY – LIFE SCIENCES
www.calicolabs.com
https://verily.com/

Calico, formerly the California Life Company is “tackling aging” and age-related diseases by harnessing new technologies. Its mission – to extend life – is pretty ambitious, but the actual workings of the company are not well-known. Here is a short article about Calico: (http://recode.net/2015/12/28/the-stealth-attempt-to-defeat-aging-at-googles-calico/).

Verily aims to harness technology to better understand human health and defeat diseases, although not specifically related to aging like Calico. In the following article about changing its name from Google Life Sciences to “Verily” (which comes from Shakespeare and means truly or certainly), Verily CEO Andy Conrad stated that the name was “aspirational”. “Only through the truth are we going to defeat Mother Nature.” (https://www.statnews.com/2015/12/07/verily-google-life-sciences-name/) What? Who decided that anyone should attempt to defeat Mother Nature?
For more information about Verily: (http://recode.net/2015/12/14/verily-googles-health-gambit-is-stacked-with-scientists-now-it-needs-to-build-a-business/)

DEEPMIND
https://deepmind.com/

Google acquired Deepmind Technologies, a U.K.-based Artificial Intelligence company in 2014. At the time, Deepmind had the largest number of researchers working in the field of deep learning, the science of teaching computers to analyze information from the human world and applying that “knowledge” to learn human tasks. Deep learning is particularly effective when combined with ‘big data’, which is Google’s primary asset (thanks to all of us Google users). Deepmind recently became famous with the success of its AI computer AlphaGo, which defeated the world Go Champion Lee Sedol in a series of matches in South Korea earlier this year. (https://gogameguru.com/tag/deepmind-alphago-lee-sedol/)

SIDEWALK LABS
http://www.sidewalklabs.com/

Sidewalk Labs wants to apply technological solutions to solve urban problems like traffic, housing and energy. This article from Wired provides a good description of Sidewalk Labs, and in particular its first urban project LinkNYC creating wifi hubs around New York City: (http://www.wired.com/2016/02/googles-city-fixing-sidewalk-labs-is-finally-getting-to-work/).

Meanwhile, the LinkNYC project is rolling forward. More than a dozen “links” are active along Manhattan’s Third Avenue, with another dozen coming soon. The plan is to expand to 7,500 within a few years. The kiosks don’t just spew WiFi like an open hydrant shoots water; they also gather intelligence on what’s happening around them—traffic patterns, noise levels, and air quality. “No static study will match that kind of tool,” Kaufman says. And cities around the world are interested in setting up similar networks.

Creepy? Maybe, though perhaps no creepier than anything else Google does with your data.  …

(Those are Wired’s words, not mine…)

Alphabet Intrigues

So that covers the named subsidiaries of Alphabet and some of their main activities. However, when you start researching Google you get the sense that no one is actually sure what they are doing or why (except maybe Google’s co-founders Sergey Brin and Larry Page.) For example, I learned that in 2014 a Google subsidiary Planetary Ventures paid NASA $1 billion to lease for 60 years 1,000 acres of an airfield and hangar, apparently to carry out space exploration, aviation and robotics projects, although no one is sure. (http://www.nbcnews.com/science/space/google-takes-over-nasas-moffett-airfield-robot-space-research-n245561).

And, many people were not aware of Google’s stake in Boston Dynamics before the video of Atlas, the humanoid robot stacking boxes went viral earlier this year (https://www.youtube.com/watch?v=rVlhMGQgDkY). Shortly after more than 15 million people had viewed the video, Alphabet decided to put Boston Dynamics up for sale.   (http://www.bloomberg.com/news/articles/2016-03-17/google-is-said-to-put-boston-dynamics-robotics-unit-up-for-sale). Theories for this divestment range from the practical to the conspiratorial. On the one hand, it is said that Alphabet decided that the technology behind these robots was not close enough to be revenue-producing, and therefore decided to let it go for commercial reasons. The more conspiratorial view is that the viral video so alarmed people about the impending take-over of human jobs by Google-developed robots that Alphabet wanted to distance itself from the bad publicity (and potential scrutiny?) that its continued association with Boston Dynamics (which also has contracts with the U.S. military) would bring.

In the meantime, there are also secrets lurking around Google’s investment in Deepmind. Of particular concern is mystery surrounding Deepmind’s ethics committee, the members of which Alphabet still refuses to disclose.

Media and academics have called on DeepMind and Google to reveal who sits on Google’s AI ethics board so the debate about where the technology they’re developing can be carried out in the open, but so far Google and DeepMind’s cofounders have refused.

(http://uk.businessinsider.com/google-ai-ethics-board-remains-a-mystery-2016-3)

And finally is Alphabet building a city? Apparently Sidewalk Labs has plans afoot to build a city from the Internet up. http://www.dailymail.co.uk/sciencetech/article-3525352/Is-Google-s-parent-company-planning-build-CITY-Alphabet-exec-hints-compelling-plan.html

Almost daily there are news articles describing new Google ventures, often hinting at some mystery surrounding these pursuits. In my mind, the breadth of Alphabet and the lack of transparency around some of its activities is concerning. This concern is enhanced because it is also using its wealth and dominance to influence policies in the United States and other countries.

Lobbying

In 2015 Alphabet spent nearly $17 million lobbying the U.S. government. This compares to Apple’s approximately $5 million, and Facebook’s and Amazon’s nearly $10 million each. What are they lobbying for (besides regulations for self-driving cars)? Perhaps this information should be disclosed along with the amount of money spent? (https://www.opensecrets.org/lobby/clientsum.php?id=D000067823&year=2015).

Imperial Facebook

Ironically, as I prepare to post this article about the Alphabet’s dominance and expansion, The Economist has just published an article about the dominance of Facebook and its plans to expand in many of the same areas: (http://www.economist.com/news/leaders/21696521-mark-zuckerberg-prepares-fight-dominance-next-era-computing-imperial-ambitions).

It looks like competition, at least between these two behemoth companies, will continue to thrive. This is particularly the case if we consumers continue to willingly and unquestionably allow them to track our digital footprint and collect our personal information to grow their empires.

 

 

 

 

 

 

 

 

 

 

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Journey to the Future: Trade or Technology? Who…or WHAT…is coming for your job?

As I watch the U.S. presidential campaign from abroad, I am intrigued that there is so much talk this year about trade, and in particular, the North American Free Trade Agreement (NAFTA). NAFTA came into effect in 1994 – that is 22 years ago! There have been five U.S. presidential elections since that time, and I sincerely cannot recall NAFTA being such a major issue in any of those elections until now.

NAFTA created a free trading bloc between the United States, Canada and Mexico. I was in law school in Washington, DC, when then President George H.W. Bush signed the agreement (in 1992), along with the then Canadian Prime Minister Brian Mulroney and the Mexican President Carlos Salinas. As NAFTA was an international treaty, the U.S. Congress had to ratify it, which it did in 1993, under then President Bill Clinton. I need to reach back into my memory, but as I recall at the time (I was studying some trade law), NAFTA was a really exciting development. It was creating the largest free-trade area in the world. It was a natural response to the increasing economic power of the European Economic Area that was emerging as a major competitive trading bloc (that is now the European Union). It also seemed like an appropriate development in the early days of globalisation and its promises of global peace and prosperity following the dissolution of the Soviet Union in 1991.

Globalisation was offered up as the great leveller, bringer of all goods cheap, the guarantor of world peace. Yes, some jobs would be lost as corporations moved their operations where the labor was cheaper, but that meant cheaper goods for all consumers! And, globalisation was supposed to make the “pie” bigger, meaning that increasing trade would bring increasing wealth to everyone. Moreover, losses to manufacturing jobs could also be looked at as an opportunity for societies to “progress” to some higher state of “service” economy that meant higher wages for everyone. Everyone would be a winner. And those GAP t-shirts were so cheap!

This is just how I recall some of the exuberance of the time.

Obviously this is not how things have turned out. In many cities and towns, manufacturing jobs lost to globalisation have not been replaced with higher-paid jobs in the service sector; globalisation has not been a leveller; and we do not have world peace. Moreover, two more major trade deals are currently in the news: the Trans-Pacific Partnership Agreement (TPP) recently signed by President Obama and 12 other countries in the Americas and Asia, excluding China. (You can read more about it here: http://www.bbc.co.uk/news/business-32498715). And the trade agreement currently being negotiated with the European Union called the Transatlantic Trade and Investment Partnership (TTIP) (You can read the European Commission’s view on it here: http://ec.europa.eu/trade/policy/in-focus/ttip/index_en.htm.)

No wonder trade is such a big issue in this election. But if NAFTA was renegotiated, and both the TPP and TTIP were scrapped, I can’t help asking whether we don’t still have a bigger problem on our hands. Isn’t technology, rather than trade, the bigger threat to job security today?

In my last post, I summarised the state of research into Artificial Intelligence very broadly. In this post, I want to think about the remarkable advances of ANI – Artificial Narrow Intelligence. This is not the AI of the future that potentially threatens our humanity. But it is the AI that is with us now, which is fundamentally altering our societies by creating all sorts of computers that can take over human tasks. This will push a lot of people out of work.

The other day I read an editorial in the New York Times called “Long-haul Sweatshops” about how to improve the lives of long-haul truck drivers, whose work has become more difficult as advances in technology (mostly in the name of safety) have actually resulted in making a difficult job much harder and potentially less safe. (http://www.nytimes.com/2016/03/09/opinion/long-haul-sweatshops.html?_r=0)

I found this ironic since I had also just read an article in the U.K. press about how self-driving lorries (trucks) are soon to be tested on U.K. roads. (http://www.bbc.co.uk/news/uk-politics-35737104) What will all of the truck-drivers do then?

We are seeing the consequences of economic insecurity brought on by globalization play out vividly in this year’s U.S. presidential election, but what is on the horizon seems to me an even bigger issue. Advances in ANI that translate into automation of jobs will be similar to the job losses wrought by “free trade”, but potentially much greater. The job-shifting will be to computers rather than to other people in developing economies, and the jobs affected may very well be the very “service” economy jobs that were supposed to absorb people displaced from the first round of globalisation. Indeed, AI for lawyers, bankers and analysts – very high-paying, highly skilled jobs – are already being affected. In many ways, the ANI that involves the analysis of information, and doesn’t require elaborate robot bodies, are most at risk.

Up to this point, some experts have argued that technological developments do not result in net job losses, but rather job shifting, and that tech advances are more positive than negative in terms of our lives and economies. One of the most quoted examples of this is the impact ATM machines have had on the banking industry. Instead of bank tellers losing their jobs, the introduction of ATMs have apparently freed the tellers from mundane tasks like depositing checks and allowed them to switch into more “customer relationship” roles. (This paper explores this phenomenon: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2690435.) However, ATMs are just the tip of the iceberg. With the advances in AI we are seeing today, where the very goal is to teach computers how to do human tasks better than humans, the outcome can only be job losses on an epic scale.

I do not believe we are prepared for this level of dislocation. Focusing on the U.K. for a moment, the consultancy firm Deloitte estimates that as many as 11 million jobs in the U.K. have a high chance of being automated within the next decade. (The surprisingly upbeat report about this development can be found here: http://www2.deloitte.com/content/dam/Deloitte/uk/Documents/Growth/deloitte-uk-insights-from-brawns-to-brain.pdf.) To give this some context there are just over 60 million people in the U.K. (and not all of them are employed). Of course new jobs (for programmers!!) will be created while other jobs are automated, but no trade agreement that I know of has caused that much disruption. Nevertheless, job insecurity resulting from technology and automation does not seem to be getting much attention.

Tom Watson, a U.K. Labour politician noted in a recent article :

“There is no minister for this new technology. No special cabinet committee has been set up to come up with solutions. There is no royal commission to look at the economic impact robots will have, or the ethical dilemmas they will pose. Where is the new institution that brings together trades unions, employers and government to establish how the time liberated and wealth created by robots is equitably shared?”

Mr Watson goes on to add:

“… the golden age of the knowledge economy has not yielded all that it promised. The success of big tech platforms like Google, Amazon and Facebook has seen huge amounts of cash accrue to their balance sheets, but very little investment in social infrastructure, education, skills and health. The situation is worsened by the apparent inability of government to tax these tech giants.”

(http://www.theguardian.com/commentisfree/2016/mar/08/robots-technology-industrial-strategy).

The current political climate is a testament to the poor policy reaction to globalisation. Blinded by its potential benefits (global peace and prosperity), not enough people were focusing on those who were being left behind. Something similar seems to be happening with the technology revolution. We are so impressed by the latest tech inventions and so anxious to reap the various efficiencies and other benefits that these inventions bring, I am not sure we are considering the consequences. The fact that the tech jobs that are supposed to replace the automated jobs pay more only fuels the enthusiasm…but I think I heard an argument like that once before.

I know that these issues can create huge ideological divisions, but they don’t have to.

Whether you lose your job to a worker living in Mexico or lose your job to a computer, the result for the domestic economy is the same. There is one less satisfied, contributing member in society. If this affects one or two people then maybe we can all ignore it, but when it is literally millions, then I think its time for a plan. Or to be more controversial, when the affected people are autoworkers in Detroit, or washing machine manufacturers in Indiana, maybe it takes a while to reach the political radar screen. What if the affected are financial analysts, wealth managers, engineers, doctors and lawyers?

Giant tech companies and hundreds of start-ups continue to develop their AI technologies and put them out into the market like any other products. They are making things cheaper, making our lives more convenient. But in some cases, these products are replacing jobs. Does this make them different to other “products”? Does it make these companies different to other companies?

I really don’t have the answers, but I would like to think that this issue will get people thinking as much as the trade debate has. And I hope it doesn’t take 22 years!

 

 

 

Journey to the Future: Artificial Intelligence

The Narrow Road to the Deep Learning that Leads to …
Immortality …. Or Not

I am wading into the murky field of Artificial Intelligence (AI) as it was a conversation around AI that influenced me to start this blog. If this were me a few weeks ago, I would have rolled my eyes and clicked off of this page. But, instead, I spent the last week reading as much as I could about AI to get my head around the topic, and it wasn’t that bad! There are millions of books, articles and posts out there. I only scanned the tip of the iceberg, but I already feel much more enlightened about what is going on. I can also recommend a few articles that are fun to read and very comprehensive for anyone who wants to know more and doesn’t have time to carry out their own search. There is a short reading list at the end of this piece for anyone hungry for more information.

A Word about Robots

Before I launch into my quick overview of where I think we are in terms of AI and some of the implications that may be worth thinking about, I want to say a word about robots. I am not going to use the word “robot” very much in this piece, although robots are very much part of this debate. Robots are just the shells in which AI exists even though we often think of them as one and the same thing. AI is the computer (the “brain”, sort of) that controls the robot shell (the “body”). However, how AI develops and how it affects our lives will also be affected by what kinds of robots we make to house the AI in. Just like human progress was influenced by changes to our physicality (standing upright, developing opposable thumbs, etc…), so the physical attributes of the robots we create will impact how the AI that is developed impacts us; how “effective” it is in replacing humans doing certain tasks, for example. A quick example is the recently developed Atlas Robot that can pick itself up after it falls (https://www.youtube.com/watch?v=PisoSgwcRVQ). This was apparently a major development in robotics.   So, keeping in mind that the shell part of this is very important here is what I have learned about AI.

ANI – AGI – ASI:  The Path to Artificial Super-Intelligence

Yikes, this sounds scary and it is to an extent. But it gets less scary once we understand what is going on. That is our goal. This is a just quick summary so again, if you want more, please take some time to read what the experts have written.

There are three broad categories of Artificial Intelligence: Artificial Narrow Intelligence (ANI), Artificial General Intelligence (AGI), and Artificial Super-Intelligence (ASI).

Artificial Narrow Intelligence

ANI is with us and all around us in the form of computer programs that can accomplish specific narrow tasks usually carried out by humans. This can range from voice recognition programs and GPS to the technology in self-driving cars. SIRI is a kind of ANI, and so are the computers that can play strategy games like Go and Chess.

(As I write this DeepMind’s AlphaGo program has just beaten the world Go champion, Lee Sedol, in the first of a series of matches taking place in South Korea.  See more about that here:  (Match 1 – Google DeepMind Challenge Match: Lee Sedol vs AlphaGo).)

The computer programs that track our purchases on Amazon, or our searches on Google are ANI. And here is a new one that recently moved into my Microsoft Outlook mailbox: Clutter. Clutter is an email filter. It sifts through my emails for me and files away ones that it thinks I don’t want to read. Every once in a while it sends me a list of these emails and asks me to put back into my inbox any important messages. It explains, “Clutter will learn from this and do better next time.” Yay!

ANI (with the proper robot bodies) can stack boxes; go into warehouses and collect deliveries and potentially then go on to make those deliveries; (or without elaborate physical robot bodies) can carry out financial analysis and legal research…you name it. The goal of developers of ANI seems to be to create programs that can do these specific tasks better than humans, thus freeing up humans to do other more fun or interesting things with their time. (But wait, what happened to work, and earning a living?) Anyway ….

I think of ANI as really advanced computational ability, rather than something more difficult to define like “intelligence”. But apparently, when you take this advanced computational ability and then allow computers with these abilities to access other programs/algorithms out there that can do similar types of computations, these linked programs can make interesting connections and deductions and begin to teach themselves new, more efficient ways of doing the task, and you eventually end up with something that is very close to “intelligence”. This machine learning is happening now and not only improving ANI (for example perfecting speech patterns in computers so that they can sound and respond more and more like humans), but leading us … some say quickly some say slowly… to the next level of AI called Artificial General Intelligence.

Artificial General Intelligence

AGI does not yet exist. It refers to a “computer” that has learned how to do all of the different things that humans can do from narrow tasks captured in ANI – ranging from tying one’s shoe to recognising a face or an object to advanced calculus – and everything else that you or I can do. Like ANI the objective of AGI is to create computers that can do everything that humans can do, but do it better. This way we could have one computer doing everything rather than one that plays chess, and another that stacks boxes, and a third that does financial analysis.

Artificial Super-Intelligence

Finally the third level of AI, Artificial Super-Intelligence or ASI occurs when AGI is so effective at self-teaching that it surpasses human level general intelligence in every way. This is the point at which we have reached the so-called existential threat to humanity. It is the point where we either are able to attain the ultimate goal of immortality (… by the way, is this is a valid goal and who is deciding this for us?) or where we write ourselves out of history. However, as explained in some detail in the articles below and referred to in my point about robots above, the benefits and/or threats to our humanity of achieving ASI depend also on progress in other fields, and in particular, robotics and nanotechnology (the manipulation of very small matter). This is because once the ability to manipulate atomic particles combines with Super- intelligence, we have no idea what might result.

Experts are trying to develop AGI in at least three ways according to the post by Tim Urban below. Here is how I would try to summarize this: i) neural networks: using our understanding of how our brains receive and process information and creating computer programs to replicate that process; (ii) replicating something like evolution: by developing many different programs/algorithms and letting the most successful ones combine with other successful ones (while the ones that are unsuccessful die out) until you get the algorithm that provides the best intended outcome; and (iii) computer-led: leaving it up to computers to research and develop on their own by creating programs/algorithms that allow the computer to sift through existing programs and building programs that allow the computer to create new ones, thus endlessly improving itself on its own. (Again, a more sophisticated explanation can be found in the bibliography.)

Do any of these get to the essence of being a human?

Intuition and that “Gut-feeling”

One question I have that I have not seen addressed in the literature that I have scanned relating to AI (although I only scanned the tip of the ice-berg), is how do we account for our so-called “second brain”? The impact on our emotional selves that our gut and/or enteric nervous system seems to have on us? This is a rather new area of neurobiology, so we don’t know the answers. The book Gut, The Inside Story of our Body’s Most Under-rated Organ, by Guilia Enders is a good read and provides an overview of this area of study. One thing is for sure, if we do not understand it, then we cannot program computers to replicate it, although I suppose the advocates of reaching ASI would respond that this question and any other question we could think of could be answered by the super intelligent computer… so keep developing.

Timeframe

AI is being researched at a feverish pitch.  There is a literal race to achieve AGI although it isn’t something you or I would necessarily know about not working in the field. It is being pursued by governments, large commercial entities (we have all seen reference to Facebook and Google’s AI research (Google owns DeepMind:  Find out more about it here: Google DeepMind), as wells as start-ups, and possibly fringe elements throughout the world.

Experts in the field disagree on how quickly we may reach AGI, but most agree that once we develop AGI, ASI will surely follow, and possibly very quickly.  Timeframes for reaching AGI range from 2045 being the most optimistic, to 2060 being the median range, with a very small percentage thinking that we will never achieve this. I am personally a bit more cynical, but maybe that is because I am very outside of this field.

Reigning It In….Issues to Consider Before its Too Late

Should any of this worry us now? If so, what can we or should we be doing as individuals and societies to address it? I am sure that you have heard prominent tech experts like Stephen Hawking and Elon Musk expressing concern about AI.  Concern from these types of insiders certainly makes me sit up and take notice. They and others have called for an ethical framework for the development of AI.  Like climate-change, however, this requires us to look at a potential, distant threat (where there is no consensus on how real that threat is, and where the science and technology behind it is very hard to understand) and take steps today to attempt to reign it in.

Also like climate science, the science behind AI seems to suggest that there is a trip point beyond which it is too late to turn back. The jump from “controllable” AGI to potentially out of control ASI is predicted to be very fast and unstoppable. This suggests that we should be thinking now about the kinds of safeguards programmers should be including as they build algorithms for AGI.

Azeem Azhar raises some of the many ethical issues for consideration in his most recent Exponential View (EV) discussing Facebook’s AI research:

Facebook is using classic kids story books to teach AIs how to read. The list is rather interesting and does have some old favourites, like Lucy Maude Montgomery’s Anne of Green Gables.

… This cross-section of old British and American literature reflects the politics, power dynamics and beliefs of the time. Kipling’s Jungle Book is amongst this canon: a book which has a well-identified and troubling relationship with colonial prejudices and racist undertones. As a parent taking a child through the Jungle Book, we can make the child aware of those dimensions and put it, and Kipling himself, in a wider context. …

It would be comforting to know a cultural anthropologist or a critical theorist was embedded with the team providing some kind of lens into the perspectives embedded in those texts. Has Facebook done this? I don’t know but it’s unsettling. Azeem Azhar, The Exponential View.

(Subscribe to EV here: https://www.getrevue.co/profile/azeem?utm_campaign=Issue&utm_content=profileimage&utm_medium=email&utm_source=issue)

In my mind, all of this means we need to be open to some kind of regulation (yikes!).  But aside from being a politically-charged word, regulating the tech industry is easier said than done.  Focusing on the robotics side of this debate, the European Union undertook a study on “Regulating Emerging Robotic Technologies in Europe.  Robotics Facing Law and Ethics” between 2012-2014.  In the paper that resulted from the study on page 199 Regulating Robotics:  What Role for Europe they basically describe how difficult it is to define a workable regulatory framework for this industry. (http://www.robolaw.eu/RoboLaw_files/documents/robolaw_d6.2_guidelinesregulatingrobotics_20140922.pdf). 

Aside from the difficulty in defining a workable regulatory regime, tech experts and many others will fervently fight attempts to regulate their activities arguing that it will stifle creativity.  Moreover, this field is international, requiring supra-national agreement on how to proceed.  Any kind of unilateral regulation would surely be opposed.  One motivation for writing this blog is to have a platform to raise awareness about these developments that are very difficult to understand, but affect our most fundamental rights.  Surely we the people should have some say in how this kind of technology develops.

There are many directions to take these thoughts, yet I promised to keep these posts brief. Therefore, I am going to stop here for today, and proceed in small steps. My next post will focus on ANI taking over more and more human tasks – are we equipped for the fall-out?

Reading List:

http://waitbutwhy.com/2015/01/artificial-intelligence-revolution-1.html (A comprehensive and entertaining two-part piece that explains just about everything there is to know about the current state of AI. It took me hours to get through (stop and go), but it was worth it.)

http://www.rollingstone.com/culture/features/inside-the-artificial-intelligence-revolution-a-special-report-pt-1-20160229?page=5  (Also featured in EV (Issue 52), this is a good comprehensive piece similar to the above.)

http://www.alphr.com/science/1002792/artificial-intelligence-ten-things-you-need-to-understand (A quick read that does what it says on the package.)

http://www.theverge.com/2016/2/29/11133682/deep-learning-ai-explained-machine-learning (A more tempered look at the science behind AI.)

Two pieces that have informed my next post, which will focus on the current implications of ever-improving ANI:

http://www.nytimes.com/2016/02/28/magazine/the-robots-are-coming-for-wall-street.html

http://www.theguardian.com/commentisfree/2016/mar/08/robots-technology-industrial-strategy

Sorry, nothing artistic yet, but I like the comment from Kirsten. Thanks!

Journey to the Future … the beginning

INTERPLAY:

Technology
Economy
Politics
Art

I recently attended a very enlightening topical dinner to discuss advances in technology and in particular Artificial Intelligence (AI). This was somewhat unexpected since I do not work in technology and aside from watching my daughter build a Kano computer I am not particularly tech-savvy.  Nevertheless,  my friend Azeem, who curates the blog, The Exponential View (EV), invited me.  The Exponential View explores “exponential change: technology, business models, political economy & society.” (Subscribe here: https://www.getrevue.co/profile/azeem).  Azeem hosts these modern-day “salons” to discuss developments in technology, and I was the lucky recipient of the invitation after a last-minute dropout. It was mostly a gathering of sci-fi enthusiasts, futurists, programmers, gamers, big-data miners and AI developers. I was one of the odd-ones out, and was joined in my outsider status by a poet/baker.

As one of the other dinner guests who is pioneering the development of advanced AI systems said to me as he was leaving, “We have absolutely nothing in common, but it was very nice talking to you.” Indeed.

This dinner invitation was propitious in the sense that I had been discussing with my husband that I wanted to start a blog … about what I wasn’t sure… the world in general, I guess. I wanted to feel like I was doing something to make sense of the vast amount of uncertainty that I sense all around me. For myself, and anyone else who would want to listen. And then I attended the dinner and I learned a few things about technology.

For example, I learned that men and women seem to have different feelings about technology. Perhaps because we have children, or are more protective of our privacy, the women in the room all described a greater sense of apprehension and discomfort about being tracked by big data, for example. It also seemed like the women were more nervous about advances in AI.  I wondered if there were many women developing AI, which seems like a male-dominated field?  And I was intrigued by the real interplay between sci-fi predictions and the reality of tech advances.

I also learned that there is just a lot that I do not know about what is going on in the world of technology and I realised that this is not good.  It is feeding into my sense of general unease, and taken to its extremes, is one of the elements fueling populist political phenomena like Donald Trump in the U.S.   Not understanding how technological developments are impacting our lives, not understanding what is going to happen next, and not knowing whether anyone in the universe has a handle on what is going on makes me (and surely many people) feel very powerless, even desperate.   These issues affect the way we live our lives, our jobs (and whether we will have them in the next decade), our privacy, security and our sense of well-being.  These issues are also changing the world in which my children are growing up.  Some people’s response to these challenges is to turn to a strong-man, populist politician.  My response is to start educating myself and start this blog.

I also wanted to start this blog because another thing I learned at the dinner was that my experience living internationally and working for more than 20 years in Emerging Markets finance and sovereign debt means that I understand some of what is going on in the world outside of tech, in particular debates about economic and financial issues, pretty well. This is particularly the case in this era dominated by sovereign debt crises and economic uncertainty. Technological advances affect finance, the economy and politics in obvious ways, but there are surely subtle ways that these sectors intersect as well. I hope to explore some of these issues and find connections and trends to help make sense of the world.

And then there is Art. I think that one role of the artist is to capture the mood of an era. Often artists are most successful in identifying trends and defining the moment. Are today’s artists doing that? How is technological change represented in art and how is technology changing what art is?  So that is yet another reason for this blog. I want to find out how today’s artists are capturing the unique challenges we are facing, and understand how the study of art history will be impacted by art that may only exist in virtual reality, for example. This may be an elaborate excuse to get out to the galleries and exhibitions.

A few practical points: I want to create a glossary of terms for my readers that takes the mystery out of the jargon used in tech and finance – terms like blockchain and dark pool, and acronyms like CDS and CDO (explained well in “The Big Short”). What do they mean and why should we know or care?  Some of this I already know, but a lot of today’s jargon is a mystery to me so this will be a learning process for me as well. The blog will be a combination of my own thoughts and articles and publications by various experts. In other words, this will be a partially curated blog. My main themes will be technology, economy, politics and culture, but I may end up raving about the stresses of being a North London mother on a bad day.  I have no idea how often I will post. I know that everyone, including myself, has too much to read so I will try to keep the posts brief.

I hope that by starting this project, I gain an understanding of the critical issues of our time and as a result feel more in control of my future and that of my children. And I hope to meet many like-minded readers and contributors on this Journey to the Future….