Brett Hutley's Blog » trends

Developers as Capital

brett — Tue, 06 Dec 2011 14:43:01 +0000

I've just been reading this Forbes article called "The Rise of Developeronomics". The author argues that because increasingly software is the core value proposition that differentiates companies from each other, that software developers are more and more becoming the wealth creators in society. The author recommends investing in software developers as a way of leveraging your own capital. This article builds on an earlier article by David Kirpatick called "Now Every Company is a Software Company".

The article is making the point that programmers are becoming a core economic factor for successful companies, so much so that large companies are buying smaller companies purely for their programming teams. He points out that companies such as Google nurture young programming talent as a strategic investment.

Of course the message is hugely appealing to me as a software developer. My own opinion is that technology is exponentially increasing the potential "value space" for possible investment. For example, consider the introduction of Facebook. With that particular advance in social networking, it opened up all sorts of opportunities for individuals and companies to promote themselves and establish new kinds of dialogues with their clients. With this advance, a large number of opportunities were created, which in turn leads to more specialised development that wasn't possible before the large-scale take up of social networking. Thereby creating a lot more potential work for a larger number of programmers.

If companies don't keep up with the introduction of new technologies, they run the risk of falling behind their competitors. Not only those competitors who are able to utilise technology to make their workers more productive, but also those competitors that make better use of social networks and internet search to gain new customers and retain older ones, and data modeling and analysis to determine new markets and optimise existing ones. It seems to me that not only are developers the creators of wealth, but we are currently living in a technological arms race.

Were the Luddites Right?

brett — Mon, 07 Nov 2011 13:36:14 +0000

The Luddites were a 19th century anti-industrialisation movement (and militia), who believed that their jobs were at risk because of the industrialisation of manufacturing. They proceeded to try and destroy mechanical looms in a vain attempt to turn back the rising tide of industrialisation. These days anyone seen as a "Luddite" is perceived to be backward and anti-technology.

But were the Luddites right about the consequences of technological progress? The Luddite Fallacy states that the argument that technological progress decreases the amount of jobs is fallacious, because increases in productivity does not mean that employers will keep their production constant. Rather, employers will increase their production to suit available demand.

The Economist has a post that points out that the Luddite Fallacy is only a fallacy as long as new technology increases capital, without reducing the need for human labour. But what happens if technology increases the capital and replaces the need for unskilled human labour?

The Luddites may have been a revolution or two short of the mark, springing from the industrial rather than the computer revolution, but maybe they weren't wrong about the long-term consequences of technological progress, believing that it would destroy jobs, and cause greater income inequality. Smashing the looms is obviously not a solution to the socio-economic problems of the structural changes to our society, but neither is burying our heads in the sand.

Race Against The Machine

brett — Sun, 06 Nov 2011 15:52:11 +0000

I just finished reading the Kindle book Race Against The Machine, a book I thoroughly recommend. This was the driver of the NPR article I blogged about recently.
The book is mostly oriented towards the US, although the issues they discuss seem to be prevalent across all major economies. The authors make the case that technological improvements are severely impacting every job market except those for highly-skilled individuals.

They argue, as I have argued, that the current employment crisis is caused by structural factors such as increased productivity due to technology, rather than cyclical or stagnation factors. We are simply living in a world where the educated and skilled are able to contribute to the economy in a disproportionate way, and the less educated/skilled are forced to compete for the fewer and fewer jobs that are currently too expensive to automate. This leads to money flowing from the workers to the owners of the business, which is an unsustainable situation for the long term.

The authors point out that to a large extent, we operate in a "winner take all" society. Technology enables the best and fastest-moving in the business to capture the bulk of a market. That in turn provides a strong incentive for those with capital to further invest in technology, creating a self-perpetuating cycle. Not only is this situation self-perpetuating, but increased capital allows winners a disproportionate advantage in the race to take advantage of another business opportunity.

The positive news is that as we use technology to expand the frontiers of innovation, this will in turn create an exponential increase in the possibilities for further innovation.

Rage against the machine

brett — Thu, 03 Nov 2011 14:23:14 +0000

NPR has a story about How Technology Is Eliminating Higher-Skill Jobs. It features IBM's Watson System, that can beat the world's best human Jeopardy competitors. This technology is currently being used to automate the fields of law and medicine, so a lot of very technical jobs will disappear from some quite high-paying and respected professions.

Rather than rage against the machine, I think we need to embrace it. The survivors of the infopocalypse will be those who leverage the technology. Bring on that A.I. augmentation! I'm not sure what the socio-economic/political consequences will be if the trend for increasing unemployment continues. I am sure that we can't stuff that genie back in the bottle, and our society will need to adjust accordingly.

Of Gaps and Grass-Eaters

brett — Wed, 11 Aug 2010 13:12:20 +0000

Are the American people obsolete? Salon argues that because of globalisation and technology there is now a increased separation between capital and labour. The activities that generate wealth have both been outsourced to cheaper shores, and become more efficient because of technology. As a consequence the social contract in Western society between rich and poor - the rich provide the capital while the poor provide the labour - is breaking down. The rich still have capital, but they can now move the production of goods to the East, creating a shortage of jobs in the West.

Philip Greenspun wonders if unemployed people are 21st Century equivalent of Draft Horses after the Industrial Revolution. Is it far more expensive to keep people in work, than automating their jobs, or outsourcing?

Finally; DailyFinance has a story of how the disappearance of the middle class and the increasing gap between rich and poor has affected Japan. Apparently those that have given up on ever breaching that economic chasm and who retreat from society are termed "Grass-Eaters" by the media. Is this a taste of what will happen in the West if this trend continues?

Grayclaves and Henry the Lion

brett — Wed, 28 Jul 2010 21:55:01 +0000

I read two articles on a similar theme this morning. Firstly there was Scott Adams' post Startup Country, about creating a small, elite, light-weight country inside another country and using it to bootstrap the economy of the larger country. Secondly I read The Politically Incorrect Guide to Ending Poverty, published by The Atlantic. This article actually talks about Paul Romer's ideas on "Charter Cities" - a city governed by it's own charter, rather than national laws. According to The Atlantic, this idea goes back to the 12th century with Heny the Lion and the idea of Imperial Free Cities.

If I squint, I can maybe see this happening. Maybe it will be more along the lines of a Burbclave - a franchised nation nestled within a gated community (as envisaged by Neal Stephenson). Of course, by the time all this happens we'll be old and decrepit, so I think they'll be more like Grayclaves. We'll all be trading bio-engineered medicines with the Grayclave next door.

Coombe Abbey

The Future is Addictive

brett — Tue, 27 Jul 2010 22:15:49 +0000

I read Paul Graham's essay on the acceleration of addictiveness this morning, and it really struck a chord. I feel as though it is almost impossible to become bored these days, there is so much to do. Is this because the world is getting more addictive, or just because I have gotten older and have much more control over my life so I tend to do only those things I want to do?

If he is right and the world is becoming a more addictive place, then there are obviously many interesting implications for society as a whole. What will happen if most people are too addicted to the many pleasurable activities available to actually contribute to society? How can we make economically productive activities have the same level of addiction as those that consume economic capital? Definitely food for thought.

The Death of Blogging

brett — Mon, 28 Jun 2010 12:09:05 +0000

The Economist recently had an article on social media's impact on blogs, especially how sites like Facebook have meant the death of a large number of blogs. I have been thinking recently about this myself. I haven't posted on my own blog for over 6 months, partly because Facebook's status updates has fulfilled part of my communication needs. Partly because I've been going through a phase of focusing on work and reading, and haven't been interacting much with my social network.

I do think that blogs have a part in our future - I just think that the people who used blogs as a telephone will move to Facebook, those that used blogs as a form of SMS will move to Twitter, and those that feel the need to expound on a particular topic, and want their missives to have a greater scope and longevity will continue to use blogs.

Citizen Journalism, social networking and reputation

brett — Wed, 11 Nov 2009 13:07:22 +0000

Bill Thompson has posted a thoughtful article over at the BBC about the changes that social networking is making to our standards of social interaction. He discusses his own tweeting and live-blogging at conferences, and then talks about the news updates that were tweeted by Tearah Moore during the Fort Hood incident.

Obviously these are two examples that illustrate both the good and bad sides of citizen journalism. The good being closer interaction with the audience, potentially closer exposure to events as they are unfolding and the speed at which events are reported. The bad being that there is no controls over the quality of the information being reported - it may be true, it may not. Also, citizen journalists may unwittingly or deliberately trample over the rights of the people being reported on.

I think that reputation is the panacea for the problems described above. Journalists have a reputation to consider when they are reporting. This keeps them focused on reporting the facts and ethically constrained (obviously something has gone horribly wrong at Fox News). As online reputation becomes more of a consideration for Joe or Jill Plumber, hopefully it will mean they too will be more concerned with "getting it right", as far as their tweets, blog posts, and Facebook updates go.

Social Collapse – Best Practices

brett — Fri, 20 Feb 2009 18:20:03 +0000

Hmmm.... first I read this transcript from a speech by Dmitry Orlov entitled "Social Collapse - Best Practices", and then I saw on Boing Boing the post How are you coping with Collapse-Anxiety?

The first post describes what might happen if the US collapses in the same way economically as the USSR did in the 1990's. It then goes on to making recommendations about what to focus on - essentially food, transportation, shelter and security. I thought it was fascinating because although I have been thinking for a number of years that the economic situation was going to get bad, I didn't envision quite a collapse of that order of magnitude. As the crisis continues however, the possibility suddenly seems to become credible.

I found the comments interesting in the Boing Boing post. It seems as though quite a number of people were actually starting to find themselves in situations reminiscent of those described in the first post - primarily from posters in the US. Scary.