I ’ m going to be talking today about how technology is changing the face of cooperation.
We may take social structure among great apes as a proxy for one form of early human cooperation.
Chimpanzees, our closest relatives, exhibit more complex social structure. Sounds a bit like the US Congress.
In many ways, the evolution of human society can be seen as the evolution of our ability to cooperate at larger and larger scale. In his book Guns, Germs, and Steel, Jared Diamond traces the rise of complex society to improved methods of food production, which leads to increases in population, and thus, the kind of social organization needed to maintain order once you get beyond small kinship groups. As summarized by Michael McGoodwin http://www.mcgoodwin.net/pages/gungermsteel.html , Diamond sees four levels of human social organization, the band, tribe, chiefdom, and state: “ The band has 5 to 80 people, are usually related by blood, typically nomadic, have 1 language and ethnicity, have egalitarian government with informal leadership, no bureaucracy, no formal structures for conflict resolution, no economic specialization (e.g., Bushmen, pygmies). The tribe has hundreds of people, often fixed settlements, consist of kin-based clans, still 1 ethnicity and language, have egalitarian or "big-man" government, informal and often difficult conflict resolution problems (e.g., much of New Guinea, Amazonia). Chiefdoms have thousands of people, have 1 or more villages possibly with a paramount village, have class and residence relationships, still 1 ethnicity, have centralized often hereditary rule, include monopoly and centralized conflict resolution, justify kleptocracy and a redistributive economy (requiring tribute), have intensive food production, early division of labor, luxury goods, etc.... (e.g., Polynesia, sub-Saharan Africa, etc.) States have over 50,000 people, have many villages and a capital, have class and residence based relationships, 1 or more languages and ethnicities, centralized government, many levels of bureaucracy, monopolies of force and information, have formalized laws and judges, may justify kleptocracy, have intensive food production, division of labor, pay taxes, public architecture, etc. ”
In modern society, “ the market ” is another great engine of cooperation. It works not through any explicit coordination, but via what Adam Smith referred to as “ the invisible hand ” of overlapping self interest.
What comes next, as the internet weaves us all into a single global brain? The image is a routing map of the internet, which in its density of interconnections, increasingly looks like a neuronal map of the brain.
To understand the answer to this question, let ’ s look at the current state of things, and how it is evolving. As William Gibson said...
How does the world work today? As Bill Janeway outlines in his excellent book, Doing Capitalism in the Innovation Economy, there are three major players: the state, the market, and financial capital. Now often, when we use the term “ market, ” we confuse it with financial markets. Bill makes an important distinction between “ the market ” exchanging goods and services, and financial capital, which plays by very different rules. We saw this difference starkly in 2008, when financial firms were trading against both the interests of the real market and the interests of the state.
I don ’ t have time or frankly, the deep knowledge, to talk about the financial sector in detail today, but I will suggest that it has moved even faster than the consumer internet into the networked age, an age where massive data mining of human sentiment, program trading, algorithms that are not completely understood, take us in unexpected directions. Financial markets are very much worth studying by anyone who is trying to understand the shape of the future. Bill ’ s notion that financial capital is not the same thing as the market economy is a good place to start.
Let ’ s turn to the state. Jared Diamond describes the early forms of the state as a kind of “ kleptocracy, ” where the people in power extract tribute from everyone else, letting the rulers do things like put a major part of the productive power of society to work building tombs to commemorate them. Bill Janeway ’ s definition may be more useful, though. He writes, “ By the state... ” The state regulates the market, backstops it when it fails.
But you can see from the headlines how this three player game is evolving. Big companies like Google and Facebook have a “ foreign policy ” guiding their relationships with sovereign states; it ’ s amazing how often you see internet companies mentioned in the same headlines as sovereign states.
financial firms could even be construed as having been at war with sovereign states.
But perhaps more importantly, we ’ re seeing early signs of a fundamental evolution in the nature of the firms that are the major players in the market. Ronald Coase, in 1937, wrote a seminal paper, The Nature of the Firm, outlining why Adam Smith ’ s invisible hand doesn ’ t result in a world in which every individual acts as a free agent. The reason is, simply put, transaction costs. A firm is a way of reducing transaction costs, and in particular, the transaction costs of accumulating labor and capital for projects of a certain scale. The growth of firms is limited when the transaction costs of doing business with a firm are greater than those of doing without.
In 2001, Yochai Benkler wrote a famous paper, Coase ’ s Penguin, about the challenge that open source software, and networked society in general, makes to Coase ’ s notion of the firm. “ First, I suggest that the phenomenon has broad implications throughout the information, knowledge, and culture economy, well beyond software development. Second, I suggest reasons to think that peer production may outperform market based production in some information production activities. ”
The notion of peer production is very clear in free and open source software, where software products are developed collaboratively by a community of developers, and where, as Eric Raymond famously said, “ Given enough eyeballs, all bugs are shallow. ”
Or in Wikipedia, where the encyclopedia is co-created by an army of volunteers.
It ’ s particularly striking to watch this in action. An event happens - like the 2011 earthquake and tsunami in Japan. The initial wikipedia page appeared only a few minutes after the quake, and before the tsunami had hit.
As the events unfolded, and more information became available, the page evolved, through updates provided by thousands of people.
Resulting in an impressively complex and complete entry.
YouTube also provides a great example of “ peer production ” as an alternative to the traditional market economy in entertainment. For example, my three year-old grandson loves to watch Thomas the Tank Engine train crash videos made by other kids. This one has nearly 24 million views. Not bad for an amateur production.
Many people forget that Google too is co-created by its users. Where after all do the web pages in search results come from? Google ’ s raw material is provided by its users. Its intelligence too. Google mines the link stream and the clickstream to constantly improve its knowledge of what people are looking for. “ If you ’ re not paying for the product, you are the product. ”
Facebook is even more clearly the collective product of its user base.
Even Apple bears the imprint of peer production. After all, how much of the value of your iPhone is created by Apple, and how much by “ the market ” of participants in their “ national economy. ” I ’ m showing a first generation iphone. It had a minimal set of standard apps. It ’ s evolved since then not just through Apple ’ s innovation but by the participation of its users. Its worth noting that the first version of the iPhone didn ’ t have an App Store. It was introduced after users began “ jailbreaking ” their phones to add apps. Apple wisely decided to support and channel that entrepreneurial energy.
And of course, there ’ s kickstarter: “ Do you care enough about my project to fund it? Can you help me bring it into reality? ”
Kickstarter and other crowdfunding sites are the closest we ’ ve come yet to the society of abundance that Cory Doctorow described in his first novel, Down and Out in the Magic Kingdom. It takes place in a world in which nanotechnology has led to physical abundance, and instead of a monetary economy, there ’ s an economy of attention, whose currency is called “ whuffie, ” and whose government is referred to as “ the ad-hocracy. ”
Not so fast. On the opposite side of the coin, you can see how big companies like FB, Apple, and Twitter have exercised “ state-like ” powers of coercion over “ the market ” of companies participating in their platform. In some ways, they are becoming sovereign states. Their users are their citizens, developers are their firms. So you might argue that the old pattern is recreating itself at a different scale.
Remember Bill Janeway ’ s definition of the state?
The fanciful notion of a world map that John Battelle used to frame the Web 2.0 Summit a couple of years ago might not be so far from the truth. I ’ ve picked out a couple of recent headlines picking up on the notion of Facebook as a “ country. ” This is just a fancy, but it contains a germ of truth in it.
But there ’ s still something more to the picture. Danny Hillis once said something in a dinner conversation, which Jeff Bezos relayed in a talk at our Emerging Technologies Conference in 2004. Global consciousness is really a product of communication. It began with speech, began to cross time with writing, sped up and became global with mass media. But now, the speed with which news and memes spread from mind to mind has accelerated.
In one sense, this collective intelligence aspect is not new. In a lot of ways, the fundamental notion of the “ invisible hand ” of the market is a notion of collective intelligence. As Leonard Reed outlined in his 1958 essay “ I, Pencil ” the global intelligence and coordination required to make something as simple as a pencil is beyond any one person. The sourcing of materials - the wood, the graphite - the manufacturing, the sales and distribution, are all magically coordinated without any central authority.
But what ’ s different now is the way that electronic media speeds up that process. Using twitter, we can instantly learn about trending topics around the world, and share in the responses of others. When the 49ers lost to the Ravens the other day, it was, as Obi Wan Kenobi said in Star Wars, as if “ there is a great disturbance in the force, as if millions of voices were crying out at once. ” I didn ’ t catch that moment in a screenshot, but now you see how collective intelligence is still providing brand aftershocks for advertisers.
One part of the question of networked intelligence is summed up in what has been referred to as Joy ’ s Law. “ No matter... ”
Michael Nielsen argues that it ’ s about harnessing “ micro-expertise. ” There was an earlier game, Karpov vs the World, in which Anatoly Karpov handily defeated “ the crowd. ” But that was a speed game where there was no time to organize the community. In Kasparov versus the world, the game took over four months. There was a group of moderators who managed the community - much like Wikipedia - even though anyone could suggest a move, and the moderators argued for them, it was the popular vote that decided each move. It was thus an exercise in persuasion. A key point in the game occurred on the tenth move. One of the moderators, Irina Krush, an American champion, had studied a particular possibility and had even written a paper about it. So on that one move, she had more expertise than even Kasparov.
Trying to harness the Wisdom of Crowds, companies are using platforms like Innocentive or Kaggle.
But crowdsourcing is perhaps more obvious in products we use every day, like Amazon or Netflix.
I have a friend who refuses to see any movie with a RottenTomatoes score lower than 85.
You really understand how thoroughly we have come to rely on this kind of collaboration when you try to buy a product that is still reviewed only the old way, by experts. Many products aren ’ t included, and the information is far more limited.
It ’ s important to remember though that “ the wisdom of crowds ” in that sense only works when opinions are independent. Social networks actually demonstrate herd behavior as well. A paper by Matthew Salganic and Duncan Watts tested this thesis with music. They noted, “ Individuals... By the way - back to distributed micro-expertise: I couldn ’ t remember the reference to this paper, but after asking the question on twitter, I got a dozen links within a matter of minutes.
This means that the computer is now entering
Am I saying that Adam Smith ’ s invisible hand, when supercharged by the new statistical and algorithmic engines of the internet, is becoming a kind of global brain? Like all analogies, it is only suggestive rather than true. But it gives food for thought.
Just to give you an even more exciting view of the future, I ask you to consider Jeff Immelt ’ s vision of the Industrial Internet? What happens when machines tell us when they need to be serviced, or have open data APIs so that we can study the data to compete to increase their efficiency? GE ’ s data challenge with Kaggle.com is focused on precisely this problem. An improvement of 1% in the efficiency of jet engines would save airlines $3B per year.
Ford has a similar vision of the future of the automobile.
Again, think of the efficiency gains that are possible with more computer control. Trucks waste ...
That ’ s part of the argument for the google autonomous vehicle. Not only would it be an enormous convenience, it would lead to new gains in traffic efficiency, safety and far more.
In short, collective intelligence in computer applications is an example of what, back in 1960, JCR Licklider called Man-Computer Symbiosis. Incidentally, Licklider was also the DARPA program manager who funded the original work on TCP/IP and the development of the Internet.
The Google autonomous vehicle is a triumph of Man machine symbiosis. It looks like a triumph of AI, and surely there is a lot of algorithmic control in play, but look deeper You see, back in 2005, when a car won the DARPA Grand Challenge, it went seven miles in seven hours.
Big data and machine learning really are central. Only six years later, the Google autonomous vehicle has driven hundreds of thousands of miles in ordinary traffic. What ’ s different? Peter Norvig says that the AI isn ’ t any better. Google just has more data. What kind of data? It turns out that Google had human drivers drive all those streets in cars that were taking pictures, and taking very precise measurements of distances to everything. The car is actually remembering the route that was driven by human drivers at some previous time. That “ memory ” , as recorded by the car ’ s electronic sensors, is stored in the cloud, and helps guide the car. As Peter pointed out, “ picking a traffic light out of the field of view of a video camera is a hard AI problem. Figuring out if it ’ s red or green when you already know it ’ s there is trivial. ”
It turns out that the autonomous vehicle is made possible by Google Streetview. Google had human drivers drive all those streets in cars that were taking pictures, and making very precise measurements of distances to everything. The autonomous vehicle is actually remembering the route that was driven by human drivers at some previous time. That “ memory ” , as recorded by the car ’ s electronic sensors, is stored in the cloud, and helps guide the car. As Peter pointed out to me, “ picking a traffic light out of the field of view of a video camera is a hard AI problem. Figuring out if it ’ s red or green when you already know it ’ s there is trivial. ”
Now think about a service like Uber. It ’ s really a software systems that includes humans as part of the interface.
Or consider Square, which is revolutionizing the retail experience for small merchants. I don ’ t know how many of you have tried the combination of Square Register and the Square wallet app. It automatically checks you in when you walk into a participating merchant. Your name and face appear on the register, and since your payment details are already on file, all the retail clerk has to do is confirm your identity, as shown in this screen shot. Again, we ’ re seeing a system that is penetrating ordinary life.
We can already see signs of this in the Apple Store. If you squint a little, you can see the Apple Store clerk as a cyborg. Where most stores (at least in America) have used technology to eliminate salespeople, Apple has used it to augment them. Each store is flooded with smartphone-wielding salespeople who are able to help customers with everything from technical questions to purchase and checkout. Walgreens is experimenting with a similar approach in the pharmacy, and US CTO Todd Park foresees a future in which health workers will be part of a feedback loop including sensors to track patient data coupled with systems that alert them when a patient needs to be checked up on. The augmented home health worker will allow relatively unskilled workers to be empowered with the much deeper knowledge held in the cloud.
This is the real opportunity for new information retrieval UIs like Google ’ s Project Glass - in specialized settings where access to a computer can be seen as a powerful kind of human augmentation. I expect it to be used in professional settings before it becomes popular as a consumer device. (In social settings, it will require even more profound resets of behavior than the “ always-on ” mobile phone.)
Enough about the advances we ’ re seeing in technology affecting the private sector. Finally, I need to talk about the evolution of the third player, the State.
While Bill Janeway defined the state as the actor with the power to compel the others, there ’ s a more positive dimension, which was outlined by Abraham Lincoln in 1854. In other words, government too is a form of collective action.
When I say this, many people think of new participatory mechanisms like the White House Petition site, We The People.
Or startups like Popvox (I am an adviser and investor) that allow deeper engagement between citizens and their legislators.
Or the Madison project of Darrell Issa https://github.com/opengovfoundation/the-madison-project , which allows collaborative editing and input into bills. Citizens, for the first time, are able to see and help craft legislation in process.
Jen Pahlka said this well. In her TED talk, she said... When government works like the internet, it lays down standards and infrastructure that the market can build on to deliver new value for society. Government is not the provider of last resort, it ’ s the framer of rules and the builder of foundations.
The notion that we just need better ways to make our voices heard is rooted in a notion I call “ Vending Machine Government ” We put in taxes and get out services, and when we don ’ t like what we get, we shake the vending machine. The term was introduced by Donald Kettl in his book _The Next Government of the United States_. He meant it in a different way than I do - that one of the roles of government is precisely to create predictable services, like a vending machine.
That ’ s why I ’ ve been trying to shift the mindset from government as a vending machine for services paid by taxes, to the notion that government should be a platform.
One of the clearest expressions of this notion are national highway systems, not to mention the role of government in setting and enforcing rules of the road. But apart from aberrations like the Road to Nowhere, the crowdsourced destinations we call cities determine where the roads go, and we the people are free to use them to go where-ever we want. The US Interstate system, which provided a transformative economic foundation for our country, was championed by President Eisenhower in 1956.
People like to rag on government, but consider this provocative tweet from Mike Loukides.
In the valley, we ’ re all excited these days about data. Government has been in this business for a long time. Consider weather. Here ’ s Google ’ s forecast for San Jose yesterday when I was creating the slides for this talk. But where did that data come from? I ’ ve always found myself wondering why people aren ’ t more aware of how government data powers non-governmental services that citizens take for granted, many of them never taking the time to think how much government investment went into building the infrastructure that makes it possible for the private sector to offer services like weather predictions.
How about Global positioning satellites. Here government investment in a hard, long term project, is paying off in uncounted new private sector developments. A huge project with uncertain return, started in 1973 and now showing enormous fruit in the 21st century, with huge value add from the commercial sector. Everything from maps and directions on your phone to future self-driving cars spring from this platform investment, and the key policy decision to open the data and make it available for commercial use. No one dreamed of the unexpected applications that became possible by opening up this data. That ’ s why we need open web services by default.
Mapping services have taken data developed at great expense by government and turned it into hugely powerful experiences for citizens. Here are my walking directions from my hotel to this venue today, courtesy of Google, but also of centuries of government investment in mapping services. Not to mention that Google Transit directions got its start with the government of Portland, Oregon, who in classic internet style, proposed a data specification for transit timetables that could be consumed by third party applications.
And in the city of San Francisco, you ’ re beginning to see all parking meters equipped with sensors, and pricing will ultimately vary by time of day, and ultimately by demand. I ’ m calling these systems of “ algorithmic regulation ” - they regulate in the same way our body regulates itself, autonomically and unconsciously. All of the technology “ smart city ” initiatives need to be seen as ways of instrumenting not just the physical city but the social life of the humans who live in it.
But there ’ s a problem, because of Moore ’ s Law. As you recall, this law, named after Intel co-founder Gordon Moore, predicts that computing power will double every two years. As you can see that leads to accelerating increases in power. In a recent talk at Code for America, Clay Johnson pointed out
that the slow pace of government action, and slow procurement processes, put government behind on the Moore ’ s Law curve.
That ’ s why I ’ ve been working with a nonprofit called Code for America on this idea. Code for America provides new kinds of engagement, working with local governments to build simple, beautiful and easy-to-use interfaces to government services and challenging government to reinvent the way it engages with citizens. We do a lot of work with open data.
I ’ ve also been an adviser to the Presidential Innovation Fellows program, which is in part modeled on Code for America.
At Code for America, we ’ ve capitalized on the idea that open data can also be the basis for new companies, by launching a startup accelerator, finding and nurturing creative startups who are re-using or opening up government data, creating new interfaces to government services, or building tools that will help governments to engage with their community. Several of last year ’ s fellow teams have also now launched startups to continue their work. Ron Bouganim and I, who ran the Code for America Accelerator last year, are raising a “ GovTech ” venture fund to provide capital to the new round of civic startups.
In Oakland, we ’ re going to be standing up a version of the RFP-EZ procurement application developed by the Presidential Innovation Fellows for the SBA, as well as creating tools for streamlining FOIA requests. RFP-EZ can be thought of as a kind of on-ramp to the government app store.
But simply getting more private companies on the government platform isn ’ t enough. Jennifer Pahlka, the founder and executive director of Code for America, asks I suspect that, like Apple customers, we ’ d be happy to pay our taxes, because we love the product we ’ re getting.
Let me show you one of these “ simple, beautiful, and easy to use ” projects - a potential replacement for the Honolulu website - a search engine called Honolulu Answers that gives simple, clear, plain language answers to the most common questions asked by citizens in Honolulu. What the Code for America team working with the City of Honolulu did seems obvious to those of us in Silicon Valley: they mined the visitor logs of the existing site and the city ’ s call center to find out what people are really looking for, instead of what government departments want to say about themselves. You ’ ve seen a lot of government websites, full of press releases, and crowded with information no one needs. If I had more time, I ’ d show you the City of Honolulu ’ s existing website.
And that ’ s also what Code for America took into account when designing Honolulu Answers. Rather than having the city staff, or the Code for America fellows, write the answers, they convened a gathering of citizens to suggest new questions and write the answers in plain English.
We ’ re also working with data and predictive analytics in a big way. This coming year, we ’ re going to be working with New York City and Louisville KY on a project that Anne Milgram from the Arnold Foundation, calls Moneyballing Criminal Justice. It turns out that pre-trial incarceration is one of the biggest costs for cities. Using predictive analytics to figure out who to release on bail can save huge sums for cities, but more importantly, it can save jobs and families. Keep someone in jail unnecessarily and they may lose their job, forcing them into the very life of crime we ’ re trying to avoid.
In short, as we focus on evolving the mechanisms of the market via internet technologies, let ’ s not forget about government.
Social Structure Among Gorillas “The
silverback is the center of the troops attention, making all the decisions, mediating conflicts, determining the movements of the group, leading the others to feeding sites and taking responsibility for the safety and well-being of the troop. Younger males subordinate to the silverback, known as blackbacks, may serve as backup protection.” Wikipedia
Social Structure Among Chimpanzees “In
chimpanzee society, the dominant male does not always have to be the largest or strongest male, but rather the most manipulative and political male which can influence the goings on within a group. Male chimpanzees typically attain dominance through cultivating allies who will provide support for that individual in case of future ambitions for power.” Image: John Mitani http://sitemaker.umich.edu/mitani/ Wikipedia
The “Invisible Hand” of “the
Market” “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.”Adam Smith 1759
The Three Player Game “I
have come to read [the history of the innovation economy] as driven by three sets of continuous, reciprocal, interdependent games played between the state, the market economy, and financial capitalism.” - Bill Janeway
The State as Kleptocracy “By
the state, I mean the political entity that has sufficient coercive power to establish the rules for the other players.” - Bill Janeway
“In this paper, I expand
consideration of the policy implications of the apparent success of free software in two ways. First, I suggest that the phenomenon has broad implications throughout the information, knowledge, and culture economy, well beyond software development. Second, I suggest reasons to think that peer production may outperform marketYochai Benkler based production in some information production 2001 activities.”
The market as an example
of collective intelligence “Simple? Yet, not a single person on the face of this earth knows how to make me.” - Leonard Reed, 1958 http://www.fee.org/library/detail/i-pencil-audio-pdf-and-html
Kasparov vs. The World (1999)
“The greatest game in the history of chess.” -Gary Kasparov “Although Krush was inferior to Kasparov in nearly all areas of chess, in this particular area of microexpertise, she surpassed even him.” - Michael Nielsen
Counter example - how hits
beget hits, importance of independence... Individuals influence each others’ decisions about cultural products such as songs, books, and movies; but to what extent can the perception of success become a “self- fulfilling prophecy”? We have explored this question experimentally by artificially inverting the true popularity of songs in an online “music market,” in which 12,207 participants listened to and downloaded songs by unknown bands. We found that most songs experienced self- fulfilling prophecies, in which perceived—but initially false—popularity became real over time.
Reflexivity “...social theories are reflexive.
Heisenberg’s discovery of the uncertainty principle did not alter the behavior of quantum particles one iota, but social theories, whether Marxism, market fundamentalism or the theory of reflexivity, can affect the subject matter to which it refers.” - George Soros http://www.ft.com/cms/s/2/0ca06172-bfe9-11de-aed2-00144feab49a.html#ixzz2KF9avwwD
“In a pulse-frequency-coded system, meaning
is conveyed bythe frequency at which pulses are transmitted between givenlocations - whether those locations are synapses within a brainor addresses on the World Wide Web…Information is beingencoded (and operated upon) as continuous (and noise-tolerant) variables such as frequencies (of connection oroccurrence), and the topology of what connects where, withlocation being increasingly defined by a fault-tolerant templaterather than by an unforgiving numerical address. Pulse-frequency coding for the Internet is one way to describe theworking architecture of a search engine, and PageRank forneurons is one way to describe the working architecture of thebrain.” - George Dyson
Human-Computer Symbiosis“The hope is that,
in not too many years, human brains and computingmachines will be coupled together very tightly, and that the resultingpartnership will think as no human brain has ever thought and processdata in a way not approached by the information-handling machineswe know today.” – Licklider, J.C.R., "Man-Computer Symbiosis", IRE Transactions on Human Factors in Electronics, vol. HFE-1, 4-11, Mar 1960. Eprint
Government as a Platform Government
as a platform means an end to the design of only complete, closed “applications.” Instead the government should provide fundamental services on which we, the people, (also known as “the market”) build applications.