Thought Starters: Uber, Machine Learning, “Alt-Right” Democracy and Globalisation

Thought Starters provides me with a chance to review and highlight some of the more  interesting (and hopefully well informed) opinions that I’ve read over the last few weeks. This edition is dominated by the fallout from the American elections with people looking at the reasons for the rise of such an unconventional candidate and a look at what we might expect from Donald Trump’s presidency:

Is the tide turning on Uber? There’s no disputing that the ridesharing model has become a key plank of our transport infrastructure. Question is will Uber’s pool of cash be enough to keep the company going until self driving cars arrive? Yves Smith and Eric Newcomer weigh in:

Published financial data shows that Uber is losing more money than any startup in history and that its ability to capture customers and drivers from incumbent operators is entirely due to $2 billion in annual investor subsidies. The vast majority of media coverage presumes Uber is following the path of prominent digitally-based startups whose large initial losses transformed into strong profits within a few years.

This presumption is contradicted by Uber’s actual financial results, which show no meaningful margin improvement through 2015 while the limited margin improvements achieved in 2016 can be entirely explained by Uber-imposed cutbacks to driver compensation. It is also contradicted by the fact that Uber lacks the major scale and network economies that allowed digitally-based startups to achieve rapid margin improvement.

Benedict Evans released the latest version of his Mobile is Eating the World presentation which looks at the growing synergies between mobile and machine learning, with a particularly focus on retail or automotive:

Lighting everything up with machine learning

Benedict’s presentation points to mobile apps as the dominant means for consumers to interacting with the digital world. As mobile becomes ubiquitous, we’re seeing consumers sticking to the apps they know according to research from Adobe in the US:

App abandoment is on the rise as consumers stick to the apps they know

Amazon is taking advantage of mobile technology to further automate the process of shopping with their soon to launch AmazonGo offering. Better experience for consumers, less employment for retail workers:

As mobile matures, we’re seeing the next gold rush emerging in machine learning. Sam DeBrule has pulled together a valuable collection of information sources if you’re keen to track developments in the sector as they increasingly spill over into the real world:

Machine Intelligence Startups & Tools

Providing a counterpoint to Silicon Valley boosterism is Om Malik’s column warning that technology doesn’t exist in a vacuum and that the startup sector needs to be more aware of these changes if it’s to avoid a major backlash:

“It is not just Facebook. It is time for our industry to pause and take a moment to think: as technology finds its way into our daily existence in new and previously unimagined ways, we need to learn about those who are threatened by it. Empathy is not a buzzword but something to be practiced. Let’s start by not raging on our Facebook feeds but, instead, taking a trip to parts of America where five-dollar lattes and freshly pressed juices are not perks but a reminder of haves and have-nots. Otherwise, come 2020, Silicon Valley will have become an even bigger villain in the popular imagination, much like its East Coast counterpart, Wall Street.”

Ryan Broderick tracks the rise of the “alt-right” in the US and Europe and how social media provides fertile ground for its growth.

“Facebook doesn’t want to challenge you, they don’t want to upset you, because they know that if you’re challenged on their platform, you wouldn’t want to use it as much,” Derakhshan said. “The very fact that you cannot show your reaction to anything you see on Facebook by saying that you agree or disagree or that it’s true or false and you can only show your emotions to it is very telling.”

UK’s telecommunications regulator regularly releases research looking at Britons’ use of media and technology. Their most recent report covers media use and attitudes among children and young people aged 5-15, providing a valuable window into where media is heading in the future:

Media used by children aged 5-14 at home

Pew Research’s research from the US point to ebooks market share as stabilising with a similar story for printed books. Another valuable finding is that consumers are now increasingly reading e-books on tablets, PCs and smartphones rather than just dedicated e-book readers:

Print books continue to be more popular than e-books or audio books

Americans have traditionally been strong believers in economic progress with the expectation that they will be better financially positioned than their parents. Research from Raj Chetty profiled by David Leonhardt points to this no longer being the case, a situation which is presumably leading to growing dissatisfaction with the political status quo:

Chance of making more money than your parents by age cohort in the US

Much has been made of Donald Trump’s call for bringing manufacturing back to the US with suggestions that he’ll bring in more protectionist trade policy. Mark Muro in his coverage of the American manufacturing points to how automation is seeing the sector become increasingly divorced from its blue colour labour roots:

More Output, Less Employment

Another initiative Donald Trump has been touting is investment in America’s infrastructure which is one area where the Democrats and Republicans could potentially find common ground…but the devil is in the details. Ronald A Klain’s analysis of the initiative suggests that it’s more likely to line the pockets of those already working on projects rather than providing a boost to employment:

First, Trump’s plan is not really an infrastructure plan. It’s a tax-cut plan for utility-industry and construction-sector investors, and a massive corporate welfare plan for contractors. The Trump plan doesn’t directly fund new roads, bridges, water systems or airports, as did Hillary Clinton’s 2016 infrastructure proposal. Instead, Trump’s plan provides tax breaks to private-sector investors who back profitable construction projects. These projects (such as electrical grid modernization or energy pipeline expansion) might already be planned or even underway. There’s no requirement that the tax breaks be used for incremental or otherwise expanded construction efforts; they could all go just to fatten the pockets of investors in previously planned projects.

China’s economic growth is unprecedented, but a darkening political climate has led to growing suggestions that this trend may be derailed in the future as the country adopts a more authoritarian stance:

% of world GDP from year 1700 to 2008

The rise of Donald Trump, Nigel Farage and Marie Le Pen among others points to a backlash against globalisation, but analysis from The Economist point to this trend not being shared by all countries:

Attitudes towards globalisation against change in GDP per person

Amanda Taub profiles Yascha Mounk’s research pointing to declining support for democracy among many developed countries, coinciding with the growth of the “Far Right”…Although Erik Voeten’s analysis suggests it’s not quite as severe as the graph below suggest:

Percentage of people who say it is “essential” to live in a democracy

Given the rise of the far right, Yale history professor Timothy Snyder’s 20 lessons from 20th century provides valuable advice on fighting a rise in authoritarianism  (even if it is aimed at an American readership):

1. Do not obey in advance. Much of the power of authoritarianism is freely given. In times like these, individuals think ahead about what a more repressive government will want, and then start to do it without being asked. You’ve already done this, haven’t you? Stop. Anticipatory obedience teaches authorities what is possible and accelerates unfreedom.

The Danish concept of hygge has become very much of the moment with its harking back to a simpler age but Charlotte Higgins suggests that the UK’s reinterpretation of the idea is not quite so healthy:

If, for Danes themselves, hygge has an element of fantasy – through the way it draws back from difficulties, difference and debate – then the British import is a fantasy of a fantasy. Hygge may be quintessentially Danish, but there is something utterly British about the nostalgic longing for the simple accoutrements of an earlier time – especially if it can be bought. At the same time, it is hard to deny that just at the moment, the most natural thing in the world is to want to huddle round the fire and wish the outside away. Settle in: it’s going to be a long winter.

The featured image is a MOMO mural from Sicily.

Thought Starters

A mixed collection of materials looking at societal trends and the impact of technology on the way we live.

The European Commission has released the Sixth Report on Economic, Social and Territorial Cohesion. The title might not roll off the tongue but it provides a broad range of European statistics including health outcomes, the environment, human development, demographics, crime, the economy and education among other things:

Change in Population The Economist has created an index of where the best country to be born is by looking at a range of quality of life indicators. Care to move to Switzerland?

Where to be born

Retale have pulled together an interactive infographic using U.S. Bureau of Labor Statistics data to providers users with the opportunity to see how the activities of different audiences vary by demographic in the US:

Time Survey

JWTIntelligence has pulled together a report looking at changing family structures in the US. Among the trends highlighted is the evolving nature of the nuclear family, growth in solo living, multigenerational and silver families and the rise of friends as part of family type networks:

The Internet of Things has been getting a lot of attention from the technology sector. The Wall Street Journal looks to pour some cold water on things by pointing out the failure to institute common standards as providing devices interacting that aren’t from the same brand:

Without a common software standard, devices will remain locked into what the German industry experts calls “island solutions”– brands that have a portfolio of products that can talk with each other but won’t be compatible with other brands.

The number of apps available to smartphone and tablet consumers keeps on expanding, but the average consumer only users four according to research from Nielsen:

App Usage

The GlobalWebIndex continues to infographics providing a window into global consumers use of digital.  Recent releases have looked at where WhatsApp, Vine and Pinterest are making an impact:

WhatsApp

Zeynep Tufekci gives an impassioned defence of Twitter in its current form, pointing to the advantages of surfacing content by the human flock rather than an algorithm:

I honestly doubt that there is an algorithm in the world that can reliably surface such unexpected content, so well. An algorithm can perhaps surface guaranteed content, but it cannot surface unexpected, diverse and sometimes weird content exactly because of how algorithms work: they know what they already know. Yet, there is a vast amount of judgement and knowledge that is in the heads of Twitter users that the algorithm will inevitably flatten as it works from the data it has: past user behavior and metrics.

As Twitter broadens its offering to partners by integrating ecommerce functionality with consumers’ Twitter stream with the  trialling of a Buy now button. Whilst the trial is relatively limited in scope at this stage, we can presumably expect to see it rolling out more widely soon:

Research from AOL Platforms points to Youtube as having an important role in introducing products and closing the sale when compared to other social media:

Purchase Funnel

Facebook’s quarterly earning figures released in July pointed to the company as doing a good job of growing its revenues. Analysis from Neustar suggests this position may well continue given that Facebook’s network offering is proving a leader in terms of reach efficiency and average cost although its position is trumped by ad exchanges in the quality of its audience:

Cost Index Online Advertising

Facebook is looking to be more sensitive to consumers’ privacy concerns with the  launch of its  Privacy Checkup to help users better manage their privacy settings:

A report from PageFair points to a 69% increase in the number of consumers using adblock software in the US, raising concerns that online media may be increasingly threatened by declining ad revenues.

Adobe recently released its U.S. Mobile Benchmark Report providing a range of charts shedding light on how users and marketers are taking advantage of mobile. Among the interesting statistics is the use of GPS location data and use of beacon technology:

Location Data

Another interesting data point to emerge from the Adobe presentation is the flatlining of tablet’s share of page views. This provides further ammunition to some commentators’ arguments that tablets are getting squeezed between phablets (smartphones with screen size between 5.01 to 6.9 inches diagonally) and PCs:

Tablet vs Mobile Usage

The growing importance of phablets is given further credence by Flurry’s recently released figures which point to growing market share and TECHnalysis Research’s forecast for forecasted sales in the coming years:

Unit Forecast by Sales notebooks desktops tablets smartphones phablets
Unit Forecast by Sales notebooks desktops tablets smartphones phablets

Apple’s launch of the iPhone 6 and 6 Plus is likely to provide a boost to its smartphone marketshare.  Samsung on the other hand is likely to find itself increasingly squeezed between Apple above and a growing array of Chinese based manufacturers (Xiaomi, Lenovo, Huawei, Coolpad etc) at the mid to lower end:

Smartphone Market Share

Amazon’s Fire Phone was released with much fanfare in late July but the fact that it’s now dropped the price by $200 suggests it hasn’t been a winner among consumers.

Putting this all in perspective is Benedict Evans’ valuable blog post looking at Amazon’s failure to post a substantial profit despite its large revenues:

Amazon Revenue vs Income

Evans points to Amazon’s willingness to reinvest any potential profits back into the business. Some of these investments aren’t going to be an immediate success, but others such as the Kindle have enabled Amazon to gain a market leading position:

Amazon Profit Model

Reddit gets strongly criticised by T.C. Sottek following its failure to take action on the release of nude celebrity photos:

Reddit, he wrote, is “not just a company running a website where one can post links and discuss them, but the government of a new type of community.” So, then, what type of government is Reddit? It’s the kind any reasonable person would want to overthrow.

Tim Harford looks at how we can improve our forecasting, pointing to better understanding probabilistic reasoning, working collaboratively and being open minded as key contributors:

Masha Gessen looks at how the Russian population is being squeezed between declining birth rates and falling mortality rates, pointing towards a loss of hope as a key contributor:

If this is true—if Russians are dying for lack of hope, as they seem to be—then the question that is still looking for its researcher is, Why haven’t Russians experienced hope in the last quarter century? Or, more precisely in light of the grim continuity of Russian death, What happened to Russians over the course of the Soviet century that has rendered them incapable of hope?

The featured image at the top of the page is a PARKER by GoddoG and DelwooD in Biarritz and found on GoddoG’s Flickr stream.