To Alt or Not to Alt

Bitcoin sucks. No, seriously. Mining is so energy hungry, that the whole system has to have been conceived by a bunch of climate change deniers (which might even be true). The clients look like the wet dreams of calcified COBOL programmers. And even worse: voodoo chart analysts are already refocusing from NYSE data to MtGox exegesis.

"On the Internet, nobody knows you're Satoshi Nakamoto."
DogeCoin yerselp, me invented Bitcanine.

Bitcoin is great. No, seriously. If you don’t believe me, ask Marc Andreesen (he who did put a nice face on the webs, so that everybody can use it). Now he thinks, that Bitcoin matters and wrote everything up in a must read New York Times OpEd (which true Bitcoin enthusiast are already nitpickingly try to dissect).

It matters, because …

… Bitcoin gives us, for the first time, a way for one Internet user to transfer a unique piece of digital property to another Internet user, such that the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer. The consequences of this breakthrough are hard to overstate.

This may sound a bit unwieldy. But, as he says: The consequences of this breakthrough are hard to overstate.
Let me repeat this one more time:
The consequences of this breakthrough are hard to overstate.

This may sound a bit strange, if you look at the most popular crypto currency use cases of today, currency and asset. But, as stated before: there are so many more things you can do with a distributed crypto ledger.

Bitcoin is a lot of things. But definitely not perfect (see above). So how about looking for competing technologies? Depending on the use case, Litecoin seems to have some advantages over Bitcoin – and already a quite sizeable followership. nxt claims eco-friendly mining, because of its 100% proof of stake (PoS) mechanism versus the proof of work (PoW) mechanism other coins are based on. The upcoming Ethereum plans to overtake Bitcoin as a platform by offering a sufficiently powerful Turing-complete scripting language on top of all things crypto. Says Ethereum:

Up until this point, most innovation in advanced applications such as domain and identity registration, user-issued currencies, smart property, smart contracts, and decentralized exchange has been highly fragmented, and implementing any of these technologies has required creating an entire meta-protocol layer or even a specialized blockchain. Theoretically, however, each and every one of these innovations and more can potentially be made hundreds of times easier to implement, and easier to scale, if only there was a stronger foundational layer with a powerful scripting language for all of these protocols to build upon. 

Of course, there are some strong arguments to build your application on top of the Bitcoin platform as well. The ColoredCoins guys explain:

An alternate cryptocurrency could be specifically designed to transport colored coin values.  However, Bitcoin has the largest hashing pools, which means Bitcoin is more secure and reliable.  An alternate cryptocurrency would have  very hard time providing the secure and stable distributed computational network that Bitcoin provides.

So many pros and cons. What would Andreesen do? I asked him a slightly leading question.
And that’s his clear and concise answer:

https://twitter.com/pmarca/status/425885940054106114

The power of Bitcoin lies in the network. Not just the physical network (which is already pretty impressive by itself). But the network of people involved. It’s not the tech specs of Bitcoin you have to beat. It’s the mindshare, the user base, the developers working on new stuff, the entrepreneurs finding new use cases.
And looking at some of the newly minted altcoins, all scepsis seems mostly valid. Pump and dump scams trying to attract altcoin-forex investments into cloned currencies of rather dubious value compete against more serious contenders with silly names like Dogecoin and potential gamechangers like the aforementioned Ethereum.

Of course Andreesen knows just too well, that sheer dumb numbers can easily kill any more aptly contender: the browser wars were decided by Internet Explorer’s preinstalled Windows masses, not Netscape’s superior technology. So he goes now by George Santayana Those who cannot remember the past are condemned to repeat it (and surfs the Bitcoin wave).

Not all metaphors are created Turing-complete. IE may have killed Netscape. But the three browser musketeers Firefox, Chrome, and Safari finally pruned the mighty Richelieu of HTML. And only if you’re a teensy weens altcoin, the mighty incumbent is BIG Bitcoin. For everything else, there’s VISA and MasterCard.

Ban Bitcoin! (demands VISA)

Loose lobby talks at the G8 UK Summit 2013.
Lobby laughs, lobby talks, lobby cries: at the G8 UK Summit 2013.

There’s a paper handed around between Bitcoin-friends which has the potential to scare the bejesus out of the cryptocurrency world. In June 2013, Newsdesk Media published a colorful magazine called G8 The UK Summit: Lough Erne. The esteemed list of authors include French president François Hollande, the president of the European Commission José Manuel Barroso, Barack Obama, and here we go, James Lyons, CEO of the International Cyber Security Protection Alliance (ICSPA). His rallying cry, allegedly to protect digital economies from cybercrime: ban alternative payment mechanisms, such as Bitcoin. Because they can enable criminal and terrorist groups to launder money and fund their operations.

As some people might remember, organized crime did not start with the Internet. Nor is money laundering a proprietary feature of crypto-currencies. Just ask your (un-)friendly neighborhood mobster. His family might be in the funds laundering business since some centuries and a half. And, especially regarding Bitcoin and its public ledger, large scale money laundering is not a built-in feature. To the contrary: larger transactions  leave quite a footprint in the system.

The good thing about Lyon’s two page rant: despite the officially looking publication, policywise there’s nothing set as of so far:

If the leaders of the European Union and United States could be convinced to take a lead on this initiatives, … it would also strike a blow against those who would try to destroy the fabric of our world’s well-being, begs Lyons.

Of course, some of those world leaders might be inclined to remember the last time somebody almost succeeded in destroying not just the fabric of our world’s well-being. After all, bespoke leaders are still busy cleaning up the fallout from an almost final financial Armageddon (success not guaranteed). Alternative payment mechanisms, such as Bitcoin were definitely not at the root of this evil: They were not even around in 2007, but later on conceived as a potential remedy to skullduggeries inherent in the existing system, where the proliferation of weapons of financial mass destructions has reached the level of let’s say Brooklyn, Berlin-Kreuzberg, and Clacton-on-Sea having become rogue nuclear powers of their own.

A criminal misrepresentation of facts?
A criminal misrepresentation of facts? The lobby-tomized ICSPA.

So why is Lyons fighting so hard to ban these payment mechanisms? The ICSPA explicitly exists to fight against cyber frauds in electronic commerce, which mostly involves credit card technologies conceived for a non-digital non-networked world. Crypto currencies could be applied as a vaccine against those threats. OK, look no further than into the fairly short member list of his lobbying organization: a bunch of security services companies, a UK-based retailer, the global PR powerhouse Edelman, and, oh, woopsie: Visa Europe, the bank-owned credit card giant. Oh yes, alternative payment mechanisms could definitely become a threat to Visa’s well being: if they do not want to co-opt the remedy for the self-inflicted ills they’re suffering from (and which are the reason they finance a body like the ICSPA, whose executives not just do lunches with MPs, but are a liaison to law enforcement bodies like Europol as well).

The really bad thing is: Lyons knows his core audience pretty well. He and his ICSPA share table and bed with the powers that be on a fairly regular base. At the ISSE 2013 security conference in Brussels, Lyons explained how the world needs to reset the clock on trust after whistleblower Edward Snowden revealed the US Prism internet surveillance programme. Time to review cyber trust, says ICSPA, headlined Computer Weekly.
Lyons proposed course of actions: Governments need to do a better job to help citizens to understand the reasons for conducting internet surveillance.
How would he achieve that? Combining international efforts to clamp down on child abuse pornography could help to rebuild relationships and trust between business, law enforcement and governments. Ah, got that.
And, not to forget, the Ceterum Censeo, asking for the tit for tat: an international collaboration in outlawing ignitable currencies such as Bitcoin.

How will (or should) the Bitcoin community react to such efforts?

How to survive a lobbyist in full attack mode.
How to survive a lobbyist in full attack mode.

There are three main courses of action: ignorance may sometimes be bliss and is very much ingrained into the human nature (duh!), but can have some really bad side effects. So, what else? Following the lead of traditional lobbies like ICSPA and start talking to the government as well, negotiating with regulation bodies, and getting law makers up to speed. The US-based Bitcoin Foundation seems pretty active in this area. In Novemer 2013, General Counsel Parick Murg testified at a Senate Homeland Security and Governmental Affairs Committee hearing entitled, “Beyond Silk Road: Potential Risks, Threats, and Promises of Virtual Currencies.”

And yes, it’s really important: if you want to make real business, legal certainty is not a nice thing to have, but a precondition.

But not everybody is embracing this appeasement approach. Are nice talks enough, when the chain dogs of the incumbent competition have skipped the mere bite reflex and are openly out for a kill? Not to forget: Bitcoin is still a bit player in this lobbying arena. And let’s not forget: the dark forces of financial evil did not just survive their own suicidal attack on the global financial system. They got nicely remunerated for it as well, with all blessings of the system they almost destroyed. They achieved this with hardcore PR, well oiled lobbying, and being a fundamental building block of the current system.

No way, say the makers of the Dark WalletMany prominent Bitcoin developers are actively in collusion with members of law enforcement and seeking approval from government legislators. We believe this is not in Bitcoin user’s self-interest, and instead serves wealthy business interests that make up the self-titled Bitcoin Foundation.

Parts of the community feel the same and voted with their wallets for the Dark Wallet: via Indiegogo and direct Bitcoin contributions they collected fairly quickly more than a hundred thousand Dollars.

War! Schism! Whatever! We’re talking protocol here. The only relevant schism would be a nasty fork. At its current state, both parties may distrust each other. But on the other hand, it’s two approaches which are nicely complimentary. Talking to the government is not an inherently bad thing. Just remember: really successful pirates like Francis Drake had their letters of marque, thereby minimizing theirs risks and maximizing their profits. At the same time you should never stop working on strengthening your own superpowers. The power of Bitcoin lies in being a crypto currency, and not in becoming a complacency coin.

And, besides that: I’m pretty sure that Bitcoin as a protocol or an open platform will not necessarily wipe out all existing financial players. To the contrary: clever CIOs in modern banks will embrace crypto currencies. Why? Have a look at how the current system works. It’s pretty cumbersome at its core. So the next financial innovation may hopefully not be a new and improved weapon of financial mass destruction, but an improvement of the inner workings of an ancient machine.

The true calling of Bitcoin

Here we go. A single Bitcoin is now worth more than one thousand Dollars. Success, success. Well, kind of.

Scary currency or great investment? Deflationary and highly volatile.
Scary currency or great investment? Highly volatile, but going up up up.

I don’t want to be a spoil sport, but let me dissect a bit what’s going on there. If you see Bitcoin as a currency to run your everyday business with, you run into some really crazy problems.
First thing, if you’re a mom and pop store, your accountant will have to introduce you into a multicurrency environment – which has to deal with a type of currency, which makes the volatility of old Italian Lira look like an easy thing to handle. All spikes and drops have to be accounted for for your taxes. And drops can have the unpleasant side effect that you finally make a loss on a deal, which was decently profitable when it took place.

The far more complicated part for Bitcoin as a currency (as in medium of exchange) is the built-in deflationary mechanism. The number of coins is finite (and even shrinking over time, as coins are misplaced, destroyed without a backup,…). So as long as there enough people buying, prices will go up driving more people into the system leading prices to go up and so on and so on.

Now, if inflation is bad and the opposite of deflation, deflation must be the opposite of bad? Unfortunately not. Deflation is bad as well.
A smoothly running economy is like stepping outside and it’s springtime, about 20°C (or 68°F for Americans or 293.15 Kelvin for all you mad scientists out there). Birds are tweeting. Bees and flowers everywhere. Everything is well and fine. But here it comes, the two endemic threats towards your monetary wellbeing:

  • Inflation superheats your environment to temperatures way above the boiling point. If it really gets going, there’s no real way to stop the heat until everything’s cooked way beyond well done. Wood incinerates. Metals evaporate. The end.
    And, talking about inflation, economywise, your money (and all your debts, you lucky b*st*rd) evaporates as well.
  • Deflation cools everything down. 0 Kelvin (or -273.15°C) means: complete standstill. Hell freezes over. The end.
    Economywise what’s happening is that nobody want to invest into anything anymore – besides the deflationary currency. Buying is postponed indefinitely, as prices are in a free fall. The beers I paid for with Bitcoins just a year ago (no, I didn’t; it’s a metaphor!) are now worth an iPad Air with 64GB. An exchange rate of 1 BTC = 10.000 USD doesn’t look to farfetched. And we’re not talking really longterm here: the last tenfold increase took about a year. Do you really want to buy a beer right now  – or save this BTC for now and buy yourself a Ferrari the day after tomorrow?

Which just translates into: in its current state, BTC is a really crappy medium of exchange. But an interesting money store. Highly speculative, with really interesting and not as common risk factors involved. But, hey: as long as it works, it works.

For some people it already worked pretty well. A friend of mine told me about a developer he met. He literally had found on his hard disk a stash of 40 BTC he had bought way back then and completely had forgotten about. The windfall buys him a brand new car – if he’s cashing in now.

It’s stories like this driving the BTC universe. And rightly so. Because investing in BTC isn’t any more esoteric than buying synthetic ETFs, investing in a growth stock (meaning: a company which is not making any money in the foreseeable future, but grows at a maddening speed, while nurturing the promise of phenomenal future riches wich are priced into their stock price as of today), buying yourself some rare stamps, or spending all your disposable EUR and USD and whatevers on fine arts or collectibles like signed baseball trading cards.
It’s fun, it’s risky, it’s exciting, and there might be a monetary benefit coming out of your actions (or inactions, see above).

But wait. The really good about Bitcoin is not just enabling you to make a quick buck (or loosing as quickly).
The really good about Bitcoin is about being what it technically is: a cryptocurrency, which at the same time is a rather volatile (meaning: still crappy) medium of exchange, a quite exciting value store (meaning: of highly speculative interest) – and a software platform for trustless transactions.

The equation goes a bit like this, with

  • A being the great growth in exchange value driving people and monies into platform development

and

  • B to be defined as the possibilities coming with the promise of becoming a universal medium of exchange, which keeps people and monies in the game.

And now, tadah:

  • A + B = C

And C stand for:

  • the resulting Bitcoin-related cryptocurrency software and platforms exceeding by far the effects of Bitcoin as a currency.

Trustless transactions is one of the major keywords here.
If you look at any kind of transaction between parties, basically we’re looking at a construct of a trustworthy contract between trusted parties using a trusted system. If you buy some real estate, you do want to know that you really bought yourself the Eiffel Tower from this trustworthy seller, when the trusted notary signed off the deal.

Trustless systems take most of this load off you. Because you do not have to trust all participants in the transaction. The model established by Bitcoin works pretty well for currency-type transactions. But there are already system out there using the infrastructure for something quite different. Since a couple of months, a group of students around Cornell’s Emin Gün Sirer is running the Virtual Notary.
With the following caveat:

It is not an official, legally-recognized notary, whose definition is provided by law, whose statements are court-recognized, and whose procedures are regulated. For operations that require legal standing, you should seek the help and services of an official, state-recognized notary. Please do not use Virtual Notary for something critical, like your will — you should enlist the services of a lawyer and a certified notary public.

The Virtual Notary does some nice and fancy things by itself. But finally leaves some code in the Bitcoin blockchain, using it as a public ledger, which cannot be altered.
In the same area, but pretty new around the block is Proof Of Existence. The service allows you to anonymously and securely store an online distributed proof of existence for any document and looks amazingly easy to use, with Argentine developer Manuel Aráoz suddenly finding itself at the center of interest of some quite interesting folks.

Mastercoin is to bitcoin as HTTP is to TCP/IP.
Mastercoin is to bitcoin as HTTP is to TCP/IP.

The real fun starts with two different approaches. Both are not just about leveraging the existing Bitcoin infrastructure, but by enhancing it by establishing new protocols on top of the Bitcoin protocol. That’s why J.R. Willett, masterbrain behind the Mastercoin project, claims for himself to be the author of The Second Bitcoin Whitepaper (with the legendary inventor of Bitcoin, Satoshi Nakamoto, who more or less singlehandedly started the whole craze, being the author of whitepaper No. 1).

Mastercoin is to Bitcoin as HTTP is to TCP/IP, Willett writes on QuoraWe’re building a new protocol layer on top of Bitcoin with a dizzying array of cool features that have never even been done before anywhere. Things like distributed exchange, distributed betting, distributed e-commerce, and coins which can track external values like gold or U.S. Dollars without trusting a human being to back them. 

The Colored Coin: exchanging value over the Internet.
Colored Coins: exchanging value over the net.

Maybe even more exciting are the possibilities of Colored Coins, as it seems, well, a bit more open than the fairly closely held Mastercoin-project.
Colored Coins is an open standard protocol, just like http and bittorrent, to exchange value over the internet, as they state rather matter of factly. Today there is no such standard for an exchange of value on the internet … Today Bitcoin is an amazing protocol, but the only asset you can hold on Bitcoin is the BTC.

The last sentence is probably core to understand all things Bitcoin.

  1. Bitcoin is a protocol
  2. One possible use case is holding BTC (A.K.A. Bitcoins) in this system
  3. But wait: there’s so much more.

The state of the cryptocurrency

bitcoineurope
Back to the roots.

Full disclosure: I am not a Bitcoin-afficionado or enthusiast. I am not a Bitcoin-speculator or have any other financial interest in Bitcoin as of so far. I do not even own an Android phone, which would out me at once as an outsider, if I hadn’t disguised my iPhone with Sennheiser headphones and a bulky black Lifeproof case (but still: no Bitcoin wallet on my phone, due to the app store ToS).

I have been a sceptic. To quote myself from June 2011 on Quora

“Bitcoin is a lot of things:

  • a fascinating proof of concept for a p2p cryptocurrency
  • a virtual value store with a highly irresponsible carbon footprint
  • an exercise in mass-psychology, illustrating that any perception of value is based upon mutual understanding, not some inherent natural qualities …”

Guess what. I still think this is a valid analysis. In hindsight to be amended by an appreciation of the ingenuity of coupling a complex cryptocurrency system with sassy speculation as an adoption booster.

OK, so, what am I doing on a Bitcoin conference, between wild eyed neo-neo liberals, post-Austrian libertarian economists, rags to riches full time traders, gnomish core developers, gold digging VCs, crypto-artists and software jockeys, infighting factions and secret forkers of code behind all this?

Mostly, I was enjoying myself. “This is just like in the first years of the Internet”, told me a fellow veteran of the dot-com-days. And yes, it’s true, for a variety of reasons, from potential social impact to entrepreneurial incentives to a positivistic anarcho-technological believe system like a WIRED-issue from 1993.

But, besides, net-nostalgia, Bitcoin offers much more.

  • “It’s a settlement system, which in the last four years has never failed”, says Tamás Blummer of Bits of Proof. His company is looking into Bitcoin-Enterprise application.
  • “Whole national economies might switch over to Bitcoin”, declared a whole set of panelists.
  • “A single coin might reach valuations up to a 100.000 or a Million US-Dollars”, predicted a more speculative mind (but hey, who am I to argue with any many-thousand-fold increase in exchange value).
Bitcoin in Amsterdam.
Bitcoining in Amsterdam.

But the real value of Bitcoin for the further developments of the Internets might even be more arcane. Most successful web service of nowadays share on principle: Twitter, Facebook, Soundcloud, Instagram, you name it are private ventures operating huge black boxes, which can be accessed over the Internet. The underlying protocols are private property. And, looking at Twitter, it might be easy to explain where the problem sits.

Twitter is basically a very simple messaging protocol, which (for whatever strange reasons) took the Internet by storm. Thousands of companies contributed into an API-fostered ecosystem based upon 140 characters and a central server. But with ever increasing VC investments into the monolithic service, the need for a cash out became so urgent, that it finally began to shape the service. Applications, which were to close to Twitter’s future money flows got the boot. With Twitter’s IPO becoming somewhat inevitable, what’s mostly left of the ecosystem is a 15 billion US Dollar media giant, which dabbles in some ad revenues and sells consumer intelligence to broadcasters.
Now try to imagine how the world would look like, if basic concepts like email or SMS would have taken the same path.

From this perspective, Bitcoin is a healthy step back into a direction of the Interwebs. Technically it’s a protocol, a reference implementation, and some forks of the reference. In technical reality, it’s a very stable crypto-based transactional infrastructure with many different potential uses. Economically, Bitcoin related companies are already attracting serious financing. And Bitcoin-assets seem to be in the 1bn USD range. Not a lot for a currency. But quite a lot of money for being real values stored in still kind of clunky software applications.

It’s the power of open.
And I think I’m going to make use of it.

The Future of TV

Some of you might remember the little booklet I did in the early 90ies, Fernsehen 2000: global, digital, interaktiv. Back then, the year 2000 still had this Stanley Kubrick Sci Fi ring. Now it seems like a good time to ask the same question again: What is the future of TV?

At Internationaler Medienkongress at ifa, Columbia University’s Eli Noam presented a quick ride into his take of the future of TV. Basically, he sees the following problem: according to Moore’s law, IT technology changes with an assumed 40% per year CAGR. Doing the same calculation for TV, you end up with a CAGR of 4% (dubbed Sarnoff’s law by Noam).

As IT encroaches  more and more into CE hardware territories (even a sluggish Smart TV has more processing power than your first laptop – equally, you can watch TV on your iPad or PC), there might be a threshold when the stupid box finally will disappear, like a demented dinosaur. Or, maybe not. But at least, some drastic changes are on their way. When buying a new TV set, consumers already experience a new sales spiel. It’s not just about screen size anymore (and has never been about 3D). Creative sales people now sing the praise of quad core-TVs vs the lame old dual core CPUed TV screens. Next thing, they’ll get a start button to turn them off.

But it’s not just about the hardware. The whole ecosystem is changing, and Noam sees some drastic changes coming up. One pretty convincing example: cloud delivery is not an if, but a when.

But then, what’s tv anyway? For the guys at ifa it’s all about the hardware. For a broadcaster, it’s a linear sequence of audience reach optimized content. For a professional producer, it’s professionally produced formats. For the audience, it’s their beloved hanging out in front of their beloved telly. But hey: does watching VoD qualify as watching TV? And what about a catch-up service vs. a movie played locally from your hard disk recorder vs. a bootlegged stream served via YouTube? Hmmm. It’s a hornet nest. That’s why Noam wisely prefers a Gestalt definition of TV (some kind of: if it looks live TV, it’s very likely that it is TV).

Ooops, I do it again.
2020tv.biz: ooops, I do it again.

And as we were chatting after his talk, he nudged me into the following direction: how about setting up a scenario for television in 2020? Well, OK, call me a fool in fiddling around with the future, but here we go: 2020tv.biz. My pretty ambitious and hopefully not too preposterous snapshot of 2020 television.

The most dangerous of all KPIs?

Indexes (or indices, for the bourgeoise humanists among us) are a like botox. You can use them to heal, cover up, or kill.

In case of the botulinum toxin: heal obnoxious conditions like fissura ani, cover up your probably well earned wrinkles, or use some grams of this hyper toxin to kill half a million people by poisoning their milk supply.

spacesuiteexp
Measure this and here and there!

Same goes with KPIs. You can use them to tweak your business processes by creating accountability for set goals. Because, If you can’t measure it, you can’t manage it. You can use them to cover up what’s already going wrong (Hello, Enron).
And they can have some rather impressive, probably unintended, real world consequences. And this is what the new format Berlin Debates was taking on in their first round of Cambridge Union Society style exchanges: »GDP has failed. It’s time to switch to a new measure of progress.«

Matthew Taylor, Chief Executive of the Royal Society of the Arts, debated Prof. Dr. Karl-Heinz Paqué, a politically well connected German (neo-)liberal professor of macroeconomics. Taylor preemptively summed up the two hours nicely in his blog. Not measuring the GDP, the gross domestic product, is bad. But using GDP as one of the three major yardstick to evaluate governement performance: unemployment, inflation, and economic growth.

In a nutshell, GDP is a nice tool to compare different national economies. But it doesn’t say much about the economic state of the state. As Taylor nicely explained: it’s nice to knvoting with their feet (ow that there have been five goals shot at the football game. But if you do not know who scored for which club, the information lacks a certain quality. But quantity over quality is not GDP’s only defect. GDP does not include externalities. Long term costs like pollution (which would be quality of living problems as well) are not reflected.

This does not mean GDP is bad. It’s very well defined, definitely stable (a big plus), and works on an international level. It’s just that using GDP as the main KPI to manage a national economy tends to set the wrong incentives. Says Taylor. And that’s what the audience agreed upon by voting with their feet (by choosing an exit you voted either yay, nay or whatever).

spacesuuite
Where’s the pulse?

So say good-bye to yer olde GDP? Most likely, not. Popular indices have a tremendous staying power. Even if they might have overlived their time for quite some time. Case in point: the Dow Jones Industrial Average. Published since the 1880ies, the Dow is still “among the most closely watched U.S. benchmark indices tracking targeted stock market activity”.

It’s not watched, because it’s so spectacularly well designed. Measuring stock market tendencies with the Dow is a bit like an MD measuring the pulse of a patient, who’s wearing a space suit. You might see something. But taking 30 industrial stocks as an indicator for the sanity of the US markets leads to a VERY blocky image. Still, it affects investment decisions on a global scale.

Here's the pulse.
Here’s the pulse.

Of course, the GDP’s problem is not granularity. But it skews governing decisions by omissions. So as a policy decision making toolset, it seems a bit out of whack. Because, honestly: as a citizen, you shouldn’t be interested in beating your neighbor in GDP growth. You’re interested in your own economic well being, the well being of your community.

Of course, now the hard work starts. What do we want to measure and for what reasons? What is sustainably measurable anyway? It’s a reconciliation process with a lot of stakeholders.

Don’t Pass Go (go directly to PRISM)?

The genie is out of the bottle, Obama is checking your email, and you can’t push toothpaste back into its blablabla. Welcome to our present defeatist state of surveillance.

The NSA is reading your email? Well, so do Mark Zuckerberg and the Google Bros. And, look at your inbox stats: most likely, they are putting in more effort into this task than you do. OK. Game over, don’t pass go, we all go directly to Prism.

Not so fast. This online world of ours is still in its very early stages. I’m dabbling around there since 1992 or such. As online years count like dog years, I should be about 170 years old (just like Ray Kurzweil, when his supply of dietary enhancements finally runs out). But what are a couple of centuries, if we put things into perspective. Between the invention of democracy (Athens, 500 BCE) and it’s fairly widespread adoption in the late 20th century you can count more than two millenia of feudalism, absolutism, and other -isms. Widespread alphabetism took even longer, took a hit with the invention of tv to finally resurge with the Internet.

Massive societal changes do not happen over night. If not induced by a catastrophy like an asteroid wiping out the dinosaurs (welcome, mammal), a massive war clearing the path for independence day, or 9/11 (good bye nail clippers on air planes, hello total surveillance for safety).

Which leads us back to our current sadly defeatist state of the webs. Let’s put one thing clear: the massive collection of individual data is not a recent bug. It’s a feature of every digital system, where processing power is constantly on the rise and the cost of storing data falling on an hourly base.

The core question is: who owns this data? Who’s allowed to toy around with it? If my baker or corner super market knows about my eating habits, it’s quite OK and helpful. If some secret entity concludes, that because I prefer Halal Döner, my travel patterns should be monitored, we’re entering a very troublesome area.

For quite some time, we mostly did choose to ignore those ramifications of our digital lifes. Or, to put it like that: some proposed a happy hippie hippo lala-land, a united nations of onliners, where the evil forces of meatspace can be safely ignored. Others preferred an Ayn Randian powerplay to achieve the status of robber baron of the virtuality. And, to be sure, military and governement didn’t fall asleep at the wheel. Let’s not forget: the early stages of the Internet was funded by the department of defense. And the global rollout of the Internet steamrolled all national online plays, like France’s Minitel or the German Btx.

In a recent blog post, Emin Gün Sirer, associate professor at Cornell, did something quite overdue: he named the three main stakeholders of our online world.
His three force vectors are Military/Political, Commerce, and the Public. And he tries to calculate a “back of th envelope” vector sum. His rough guesstimate: “the forces are aligned in the ratio 1:1:3, with an alliance of the public and commercial interests that overpowers the M/P establishment in favor of transparency and online privacy guarantees.”

So all’s wrapped up and fine? Most likely, not. Civil rights and liberties are not a product of absolute vecorizable powers, but something you have to work hard for, you have to stand up to (or sit down, as Rosa Parks and Ghandi did).
And, in this case, it’s a very complicated reconcilatory process.
– Government, law enforcement and intelligence services are national entities (except the black UN helicopters, of course, which are after tin foil hat wearing free Americans roaming through Wyoming). There are some very good reasons, why those agencies sometimes should be allowed to wiretap certain individuals or entities. As there are very good reasons why a total surveillance state, a big data GDR on digital stereoids is definitely a thing to avoid. And, let’s not forget: the western democratic idea of government and checks and balances means mostly, that the citizens of a given country are the ones form which all power derives (and that he sometimes has to check, if the balance is still OK).
– Commerce is mostly global. But still bound to national or supranational regulations. If those regulations enforce companies to share their big consumer data with national government agencies (which share their data with some partners in the international intelligence community, because, you know, sharing is caring and NSA and BND do take care for you), they should, in their very own interest, work against this pressure. Because loosing trust means, sooner or later, loosing market share.
– And, finally: we, the people, we are everywhere. We are the one, who have to take care of our governments and our corporations. It took some millenia to gain some liberties. And it’s fairly easy to loose them all. Either against rogue (united) states, or by ceasing to much ground to nicely colored companies.