trump card

Donald Trump is going to be the next President of the United States. And technology is to blame. If you disagree with either of those statements, you just haven’t been paying attention.

Why is Trump about to win the Republican nomination? Do you blame ignorance, stupidity, racism, sheer anger? Do you blame the cynicism and greed of the Republican party over the last 30 years? All of these answers are rooted in an ungenerous assumption about the many millions of voters who have voted for Trump and will continue to do so. You would be saying that these people are fools, ignoramuses, racists. I think that is wrong substantively, but I know for sure that is wrong for you as a person. Always choose to be generous and empathetic in your assumptions about people, so long as that serves you just as well as your lesser instincts toward mean-spirited judgment.

The generous and empathetic view here accepts that the political system of this country is incontrovertibly broken for the majority of people. And since this country is ostensibly a democracy, that majority is understandably willing to vote for the person that most loudly claims that they will revolutionize the existing system. Donald Trump and Bernie Sanders, taken together, represent the vast majority of this country’s voters.

Trump won his party’s nomination (and Bernie will not) because Trump received billions and billions of dollars worth of free advertising. In a democracy, getting the message out to the people is the fundamental lubricant of the polity, which is why for nearly all of our nation’s history, the media have been regarded as the Fourth Estate, an equal peer to our functioning government alongside the executive, legislative and judicial branches.

But in the last twenty years, intensified in the last decade, the media have undergone a tremendous upheaval, all wrought by technology. And here is where we, all of us in technology, have been so proud of how we shaped the future, so unbearably, insufferably proud. We were proud to destroy Old Media, to disintermediate the gatekeepers, to revel in the creative destruction. Pride goeth before the fall.

What we didn’t realize, didn’t take seriously, is the real value of media as an institution in a properly functioning democracy, the Fourth Estate that keeps the others honest. We destroyed the gatekeepers without any foresight that we were replacing them with monsters much more insidious: the tyranny of the click, the plutocracy of the pageview, merciless metrics. Technology has become a dominant force in our culture over the last twenty years, and we as technologists were wholly unprepared for the responsibility.

If you think Hillary Clinton is going to win the general election, you have an optimism that is wholly unsupported by the slow-motion train wreck that has unfolded before our eyes these last few months. What could possibly support that optimism? Would you deny the obvious truth that this is a representative democracy, and that the majority of voters have stated their preference for overthrowing the current system? Hillary is a creature of the system, she cannot win over those voters.

The only hope is that the will of the majority will become disengaged from this election. They will not do so in the face of the billions and billions and more billions of free advertising that the media will continue to lavish upon Trump because they are no longer gatekeeping bastions of the Fourth Estate, but slaves to the clicks and advertising dollars that the technology revolution have left to them as the only form of viability that they have left. Believing that Hillary Clinton will win the presidency is like believing the New York Times is still The Paper of Record.

Bury your head in the sand if you must. I’m making plans for 2020.

“All this has happened before, and all this will happen again.”

With all the recent coverage of Twitter’s financing, and earlier news about the Twitter-Facebook acquisition dance, you might think that the two are destined to compete to the death.

Some say they’re already competitors, that Facebook will kill Twitter, or that they are at least competitors for developer mindshare.  They are certainly competitors for media mindshare – the lower half of this chart shows that news coverage of the two has become nearly equal.

twitterfacebook1

Ah, but what about that upper half?  Search traffic for Twitter doesn’t even register compared to Facebook.  Will it really take Twitter 36 years to catch up to Facebook’s active user base? Is Twitter really even in the same game as Facebook?  There’s a hint in the #1 reason that Todd Chaffee invested in Twitter: because it’s “open.”

I like to think of Facebook and Twitter not as direct competitors, but as classic heroes of competing ideologies.  They represent yet another chapter in that old Internet story, The Walled Garden and the Open Future.  In the primary exemplum, America Online introduced the Internet to the masses, delivering a “safe” experience that attempted to control all content delivery to the end users.  AOL was eventually swamped by services that aggregated more open content (Yahoo), excelled in specialized commerce experiences (eBay, Amazon), and found massive monetization through key horizontal services like search (duh, Google).

The moral of the story is supposed to be that the open future always wins in the end.  But the moralizers conveniently forget that the story keeps repeating itself.  The walled garden is replanted again and again, and the open future is always in the future.  And people make money at both ends, and people fail at both ends.  Let’s not forget that early AOL shareholders saw the company sell at $182 billion, and let’s not ignore former heroes Yahoo and eBay struggling to remain relevant today.  Amazon and Google look like winners today, but they’ll have their rough patches too – when the game lasts forever, the only prize is that you get to compete for your life over and over again until you die.

With that cheery thought, let’s look at Facebook vs Twitter again.  Facebook fills the role of a classic walled garden experience, notwithstanding their apps platform, which seems more of a concession towards prevailing tech ideology than a coherent strategy.  Twitter is part – only part – of the competing ecosystem of open web apps.  Take Twitter together with Flickr, WordPress, WidgetBox, glue it all together with some OpenSocial and OpenID – and there you have a Facebook replacement in the classic Open Future:  it doesn’t all quite hang together yet, but someday it will – one or more of these services will become a huge new business, and Facebook will shrivel to a shadow of its former self (though early shareholders will get a chance to enjoy a huge liquidity event before then).  The open futurists will declare victory, but it’s just another battle in a neverending war.

apples to apples

Facebook turned 5 years old last week, and a couple of commentators took the opportunity to compare the company’s progress unfavorably to Google’s.

I understand the compulsion to compare every hot startup to the current media darling that literally put its name next to the definition of “Zeitgeist” – but still, I don’t believe there is any practical value in that exercise.  A meaningful comparison compares things of like kind, and comparing every company to the once-in-a-decade champion is not apples to apples.  Take a look at this list of companies, which I’d say are all the same kind of apple (of course one of them is literally an Apple):

Company Year Founded Year IPO Feb 09 Market Cap
HP 1939 1957 $87 B
Intel 1968 1971 $83 B
MSFT 1975 1986 $173 B
Apple 1976 1984 $91 B
Oracle 1977 1986 $91 B
Cisco 1984 1990 $99 B
Google 1998 2004 $119 B

These are the true giants of Silicon Valley (plus our favorite giant from up north), all companies that have spent a goodly amount of time with a market cap over $100 billion.  Comparing any private company to these monsters is a fool’s game; it’s like comparing a college basketball player to Michael Jordan.  Actually it’s worse than that – projecting athletic talent is considerably easier than projecting $100+ billion success for a company, because there are orders of magnitude more points in a company where externalities and luck play a tremendous factor.  (I always like to recall that Intel and Microsoft were initially made giants not by their own strategy, but by the strategic decision made by IBM when it chose to outsource production of its PC microprocessor and operating system.)  These true giants are Black Swans, by definition nearly impossible to predict, and useless as comparative points except when holding both points in retrospect.

If you must make comparisons, it’s more realistic to compare to the next tier, for example:

Company Year Founded Year IPO Feb 09 Market Cap
Sun 1982 1986 $4 B
Amazon 1994 1997 $44 B
Yahoo 1995 1996 $19 B
eBay 1995 1998 $18 B

I could put a dozen more on that list, but I’ll let you pick your own peer group.  Any one of those companies (yes, even that one that you think is irrelevant/dying/dead) could still take the multi-decade journey to giant-hood.  But even if they never do, they’ve accomplished something extraordinary in growing up from a tiny Silicon Valley startup (with one favorite from up north) to an independent company, a true a difference-maker in technology and the daily lives of millions upon millions of people.  Because they haven’t had such outstanding externalities and luck in their favor, they are a better basis for comparison.