Economics of Technology – Page 53

Australian Government’s Centrally Planned “Costly Internet Bungle”

(p. A6) BRISBANE, Australia — Fed up with Australian internet speeds that trail those in most of the developed world, Morgan Jaffit turned to a more reliable method of data transfer: the postal system.
Hundreds of thousands of people from around the world have downloaded Hand of Fate, an action video game made by his studio in Brisbane, Defiant Development. But when Defiant worked with an audio designer in Melbourne, more than 1,000 miles away, Mr. Jaffit knew it would be quicker to send a hard drive by road than to upload the files, which could take several days.
“It’s really the big file sizes that kill us,” said Mr. Jaffit, the company’s co-founder and creative director. “When we release an update and there’s a small bug, that can kill us by three or four days.”
Australia, a wealthy nation with a widely envied quality of life, lags in one essential area of modern life: its internet speed. Eight years after the country began an unprecedented broadband modernization effort that will cost at least 49 billion Australian dollars, or $36 billion, its average internet speed lags that of the United States, most of Western Europe, Japan and South Korea. In the most recent ranking of internet speeds by Akamai, a networking company, Australia came in at an embarrassing No. 51, trailing developing economies like Thailand and Kenya.
. . .
The story of Australia’s costly internet bungle illustrates the hazards of mingling telecommunication infrastructure with the impatience of modern politics. The internet modernization plan has been hobbled by cost overruns, partisan maneuvering and a major technical compromise that put 19th-century technology between the country’s 21st-century digital backbone and many of its homes and businesses.
The government-led push to modernize its telecommunications system was unprecedented, experts say — and provides a cautionary tale for others who might like to try something similar.
“Australia was the first country where a totally national plan to cover every house or business was considered,” said Rod Tucker, a University of Melbourne professor and a member of the expert panel that advised on the effort.

For the full story, see:
ANDREW McMILLEN. “How Australia Bungled Internet Modernization.” The New York Times (Fri., MAY 12, 2017): A6.
(Note: ellipsis added.)
(Note: the online version of the story has the date MAY 11, 2017, and has the title “How Australia Bungled Its $36 Billion High-Speed Internet Rollout.”)

Artificial Intelligence (A.I.) Cannot Automate All Legal Tasks

(p. B1) “There is this popular view that if you can automate one piece of the work, the rest of the job is toast,” said Frank Levy, a labor economist at the Massachusetts Institute of Technology. “That’s just not true, or only rarely the case.”
An artificial intelligence technique called natural language processing has proved useful in scanning and predicting what documents will be relevant to a case, for example. Yet other lawyers’ tasks, like advising clients, writing legal briefs, negotiating and appearing in court, seem beyond the reach of computerization, for a while.
. . .
(p. B3) Dana Remus, a professor at the University of North Carolina School of Law, and Mr. Levy studied the automation threat to the work of lawyers at large law firms. Their paper concluded that putting all new legal technology in place immediately would result in an estimated 13 percent decline in lawyers’ hours.
A more realistic adoption rate would cut hours worked by lawyers by 2.5 percent annually over five years, the paper said. The research also suggests that basic document review has already been outsourced or automated at large law firms, with only 4 percent of lawyers’ time now spent on that task.
Their gradualist conclusion is echoed in broader research on jobs and technology. In January, the McKinsey Global Institute found that while nearly half of all tasks could be automated with current technology, only 5 percent of jobs could be entirely automated. Applying its definition of current technology — widely available or at least being tested in a lab — McKinsey estimates that 23 percent of a lawyer’s job can be automated.

For the full story, see:
STEVE LOHR. “A.I. Is Doing Legal Work. But It Won’t Replace Lawyers, Yet..” The New York Times (Mon., MARCH 20, 2017): B1 & B3.
(Note: ellipsis added.)
(Note: the online version of the story has the date MARCH 19, 2017, and has the title “A.I. Is Doing Legal Work. But It Won’t Replace Lawyers, Yet.”)

The Remus and Levy article, mentioned above, is:
Remus, Dana, and Frank S. Levy. “Can Robots Be Lawyers? Computers, Lawyers, and the Practice of Law.” Georgetown Journal of Legal Ethics (forthcoming).

Apple Hits Record Market Capitalization for Any U.S. Company in History

(p. B20) The world’s most valuable listed company just got even more valuable.
Shares of Apple rose 0.6% to an all-time high of $153.99 Tuesday [May 9, 2017], sending its market capitalization above $800 billion, a first for any U.S. company. That level, the latest evidence of how much the stock has risen this year, is a milestone sure to stoke speculation about whether it will be the first public company to be worth $1 trillion.

For the full story, see:

BEN EISEN AND CHRIS DIETERICH. “Apple’s Latest Record: An $800 Billion Market Cap.” The Wall Street Journal (Weds., May 10, 2017): B20.
(Note: bracketed date added.)
(Note: the online version of the story has the date May 9, 2017, and has the title “Twitch Entices Video Creators With More Revenue Sharing.”)

Amazon Increases Rewards to Live-Video-Content-Creators

(p. B4) Amazon.com Inc.’s Twitch is allowing more broadcasters to make money on its platform, a move that could help the live-streaming business seize on challenges facing bigger rivals YouTube and Facebook Inc.
On Friday, Twitch said it will open up its revenue-sharing program next week for more broadcasters to get paid whenever they receive “bits”–custom, animated emoticons that act as an online currency for viewers to tip them. Twitch says bits are a way for those in the broadcasters’ channels to cheer them on.
Twitch will add more money-making opportunities to its new “affiliate program” in the future, the company said. Currently, only the top 1% of the 2.2 million people who stream on Twitch at least once a month–members of its so-called “partner program”–can generate revenue on the platform.
. . .
Twitch said its top earners in the partner program, who are its most popular broadcasters, make more than $100,000 a year. Under the new affiliate program, creators with fewer fans must meet certain criteria to demonstrate their commitment to streaming, such as a minimum number of hours spent on the air, to earn revenue. The amount of money the platform shares with its broadcasters varies depending on how it is earned.
Twitch sells bits to viewers in bundles ranging from $1.40 for 100 to $308 for 25,000. Broadcasters then earn one cent every time a viewer uses one.

For the full story, see:
Sarah E. Needleman. “Twitch Entices Video Creators With More Revenue Sharing.” The Wall Street Journal (Sat., April 22, 2017): B4.
(Note: ellipsis added.)
(Note: the online version of the story has the date April 21, 2017, and has the title “Twitch Entices Video Creators With More Revenue Sharing.”)

Dynamism Dying from Bad Attitudes or Bad Policies?

I agree with Tyler that the U.S. is less dynamic than it once was. But I mainly blame our bad government policies, while he mainly blames our own bad attitudes.

(p. A15) Is the “land of opportunity,” with dynamic labor markets and fresh sources of renewal, a thing of the past?

That’s the fear of Tyler Cowen, who argues in “The Complacent Class” that America is increasingly defined by an aversion to risk as well as to anything that is unfamiliar or different. He sees a broad swath of the American population losing “the capacity to imagine or embrace a world where things do change rapidly for most if not all people.” This mind-set, he says, has “sapped us of the pioneer spirit that made America the world’s most productive and innovative economy.”
. . .
To make his case, Mr. Cowen draws a contrast between the changes that Americans experienced in the first half of the 20th century and the changes of the past 50 years. The earlier period saw dramatic improvements in health and education as well as a proliferation of automobiles, airplanes and telephones. By comparison, the changes since 1965 have been modest. “A lot of our technological world seems to have stood pretty much still,” he writes, “albeit with a variety of quality improvements along the way.” He even notes that, while popular narcotics in the past were mind-altering (LSD) or activity-inciting (cocaine), today’s drugs of choice, such as heroin and opioids, “induce a dreamlike stupor and passivity.”
. . .
Given Mr. Cowen’s own innovative thinking, it’s disappointing that he does not focus more on potential remedies to the torpor he describes.

For the full review, see:

Matthew Rees. “BOOKSHELF; How American Workers Got Lazy.” The Wall Street Journal (Tues., Feb. 28, 2017): A15.
(Note: ellipses added.)
(Note: the online version of the review has the date Feb. 27, 2017.)

The book under review, is:
Cowen, Tyler. The Complacent Class: The Self-Defeating Quest for the American Dream. New York: St. Martin’s Press, 2017.

“Hubs of Genius Do Not Arise from Government Planning”

(p. 13) In the early 1960s, the Soviet Union tried to make a version of Silicon Valley from scratch. A city called Zelenograd came to life on the outskirts of Moscow and was populated with all manner of brainy Soviet engineers. The hope — naturally — was that a concentration of clever minds coupled with ample funding would result in a wellspring of innovation and help Russia keep pace with California’s electronics boom. The experiment worked as well as one might expect. Few people will read this on a Mayakovsky-branded tablet or smartphone.
Many similar attempts have been made in the subsequent decades to replicate Silicon Valley and its abundance of creativity and ingenuity. Such efforts have largely failed. It seems near impossible to will an exceptional place into being or to manufacture the conditions that lead to an outpouring of genius.
. . .
As in the case of Zelenograd, hubs of genius do not arise from government planning or by acting on the observations of a traveler. They’re happy accidents. To attempt to clone such things or pinpoint their characteristics is futile.

For the full review, see:
ASHLEE VANCE. “Smart Sites.” The New York Times Book Review (Sun., JAN. 10, 2016): 13.
(Note: ellipsis added.)
(Note: the online version of the review has the date JAN. 8, 2016, and has the title “”The Geography of Genius,’ by Eric Weiner.”)

The book under review, is:
Weiner, Eric. The Geography of Genius: A Search for the World’s Most Creative Places from Ancient Athens to Silicon Valley. New York: Simon & Schuster, 2016.

Self-Driving Cars Would Help Older Adults Continue to Live at Home

(p. B4) Single, childless and 68, Steven Gold has begun to think about future mobility and independence. Although in good health, he can foresee a time when he won’t be a confident driver, if he can drive at all. While he hopes to continue to live in his suburban Detroit home, he wonders how he will be able to get to places like his doctor’s office and the supermarket if his driving becomes impaired.
For Mr. Gold and other older adults, self-driving cars might be a solution.
The number of United States residents age 70 and older is projected to increase to 53.7 million in 2030, from 30.9 million in 2014, according to the Institute for Highway Safety. Nearly 16 million people 65 and older live in communities where public transportation is poor or nonexistent. That number is expected to grow rapidly as baby boomers remain outside of cities.
“The aging of the population converging with autonomous vehicles might close the coming mobility gap for an aging society,” said Joseph Coughlin, the director of the Massachusetts Institute for Technology AgeLab in Cambridge.
He said that 70 percent of those over age 50 live in the suburbs, a figure he expects to remain steady despite a recent rise in moves to urban centers. Further, 92 percent of older people want to age in place, he said.

For the full story, see:
MARY M. CHAPMAN. “Wheels; For the Aged, Self-Driving Cars Could Bridge a Mobility Gap.” The New York Times (Fri., March 24, 2017): B4.
(Note: the online version of the story has the date March 23, 2017, and has the title “Wheels; Self-Driving Cars Could Be Boon for Aged, After Initial Hurdles.”)

DARPA’s $66 Million Fails to Develop Tech to Match Dog Noses

(p. A2) “What’s cool about dogs is when they do come into contact with an odor, they can track it to its source,” said L. Paul Waggoner, co-director of the Canine Performance Sciences Program at Auburn University. “There is not an instrument out there that replicates a dog’s nose.”
That’s not for lack of effort.
The Defense Advanced Research Projects Agency of the U.S. Department of Defense spent $66 million between 1997 and 2010 drawing on the expertise of at least 35 different research institutions to develop sensors that could detect explosives as ably as a dog and identify other chemicals.
They couldn’t do it.
. . .
Surprisingly, pigs and ferrets outperformed German shepherds and Labrador retrievers, breeds often chosen for odor detection.
But overall, dogs won out because of their combination of qualities: Not only do they have strong noses, they are compatible with people, they respond to training, and–for now–they beat technology paws down.

For the full commentary, see:
Jo Craven McGinty. “THE NUMBERS; Dogs Still Beat Technology in the Smell Test.” The Wall Street Journal (Sat., March 25, 2017): A2.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date March 24, 2017, and has the title”THE NUMBERS; Making Sense of a Dog’s Olfactory Powers.”)

Apple Funds Corning’s Glass Innovation

(p. B6) SAN FRANCISCO — Apple is seeding the next generation of American-made glass for its iPhones and iPads, and its investments may have the side benefit of helping the company win favor in Washington.
Apple announced Friday [May 12, 2017] that it was giving $200 million to Corning, which makes the tough, scratch-resistant face for every iPhone and iPad, to support the glass maker’s efforts to develop and build more sophisticated products at its factory in Harrodsburg, Ky.
Corning has made the glass for every iPhone since the original 10 years ago. Apple’s investment, the first from the technology giant’s $1 billion fund to promote advanced manufacturing in the United States, will help Corning develop thinner, more versatile glass for iPhones as well as other product lines that Apple is exploring, such as screens for self-driving cars and augmented reality glasses.
The move goes beyond Apple’s traditional practice of subsidizing suppliers, said Tim Bajarin, president of the technology consulting firm Creative Strategies.
“I would see this more as an Apple-Corning partnership to flesh out what other kinds of things you would use glass for,” he said. “They are literally thinking about stuff you and I aren’t thinking about yet.”

For the full story, see:
VINDU GOEL. “Apple Gives $200 Million to Advance Phone Glass.” The New York Times (Sat., MAY 13, 2017): B6.
(Note: bracketed date added.)
(Note: the online version of the story has the date MAY 12, 2017, and has the title “Apple Gives Corning $200 Million to Invent Better Phone Glass.”)

Silicon Valley Funding Big Dings in the Universe

When Steve Jobs was trying to recruit Pepsi’s John Sculley to become Apple CEO, Jobs asked him something like: ‘do you want to spend the rest of your life selling sugar water, or do you want a chance to make a ding in the universe.’

(p. B1) One persistent criticism of Silicon Valley is that it no longer works on big, world-changing ideas. Every few months, a dumb start-up will make the news — most recently the one selling a $700 juicer — and folks outside the tech industry will begin singing I-told-you-sos.

But don’t be fooled by expensive juice. The idea that Silicon Valley no longer funds big things isn’t just wrong, but also obtuse and fairly dangerous. Look at the cars, the rockets, the internet-beaming balloons and gliders, the voice assistants, drones, augmented and virtual reality devices, and every permutation of artificial intelligence you’ve ever encountered in sci-fi. Technology companies aren’t just funding big things — they are funding the biggest, most world-changing things. They are spending on ideas that, years from now, we may come to see as having altered life for much of the planet.

For the full commentary, see:
Manjoo, Farhad. “STATE OF THE ART; These Days, Moon Shots Are Domain of the Valley.” The New York Times (Thurs., MAY 17, 2017): B1 & B6.
(Note: the online version of the commentary has the date MAY 17, 2017, and has the title “STATE OF THE ART; Google, Not the Government, Is Building the Future.”)

“Mind-Bending” Automatic Braking Trickles Down to Cheaper Cars

(p. B4) I first experienced radar-assisted cruise control in a $70,000 Mercedes in 2001. Slowing automatically to keep from hitting the car ahead felt like a magic trick. In 2009, I was told to drive a new $50,000 Volvo into the back of a “parked car” (really, an inflatable mock-up). Every fiber of my body wanted to stomp on the brake pedal. Instead, the car did it for me. Automatic braking is mind-bending the first time.
Both of these technologies are standard equipment on 2017 Toyota Corollas, which start at $19,385. So is lane-keeping assist, which nudges the car back between the road stripes if you wander. Automatic high-beam headlamps, too.
Huzzah for technology trickle down!

For the full story, see:
TOM VOELK. “Tech Trickles Down into a Safer Corolla.” The New York Times (Fri., MARCH 17, 2017): B4.
(Note: the online version of the story has the date MARCH 16, 2017, and has the title “Video Review: Not-So-Standard Equipment on the Otherwise Standard Corolla.”)