Copyright © 2019 by Rana Foroohar
All rights reserved.
Published in the United States by Currency, an imprint of Random House, a division of Penguin Random House LLC, New York.
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LIBRARY OF CONGRESS CATALOGING-IN-PUBLICATION DATA
Names: Foroohar, Rana, author.
Title: Don’t be evil / Rana Foroohar.
Description: First edition. | New York : Currency, [2019] | Includes bibliographical references and index.
Identifiers: LCCN 2019023898 (print) | LCCN 2019023899 (ebook) | ISBN 9781984823984 (hardcover) | ISBN 9781984823991 (ebook)
Subjects: LCSH: Internet industry—Moral and ethical aspects—United States. | Information technology—Economic aspects—United States. |
Corporate power—United States. | Business and politics—United States.
Classification: LCC HD9696.8.U62 F67 2019 (print) | LCC HD9696.8.U62 (ebook) | DDC 384.3/30973—dc23
LC record available at https://lccn.loc.gov/2019023898
LC ebook record available at https://lccn.loc.gov/2019023899
ISBN 9781984823984
Ebook ISBN 9781984823991
International edition ISBN 9780593137444
Book design by Victoria Wong, adapted for ebook
Cover design: Will Brown
v5.4
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Contents
Cover
Title Page
Copyright
Epigraph
Author’s Note
Chapter 1: A Summary of the Case
Chapter 2: The Valley of the Kings
Chapter 3: Advertising and Its Discontents
Chapter 4: Party Like It’s 1999
Chapter 5: Darkness Rises
Chapter 6: A Slot Machine in Your Pocket
Chapter 7: The Network Effect
Chapter 8: The Uberization of Everything
Chapter 9: The New Monopolists
Chapter 10: Too Fast to Fail
Chapter 11: In the Swamp
Chapter 12: 2016: The Year It All Changed
Chapter 13: A New World War
Chapter 14: How to Not Be Evil
Dedication
Acknowledgments
Notes
Bibliography
About the Author
I had worked hard for nearly two years, for the sole purpose of infusing life into an inanimate body. For this I had deprived myself of rest and health. I had desired it with an ardor that far exceeded moderation; but now that I had finished, the beauty of the dream vanished, and breathless horror and disgust filled my heart.
—MARY SHELLEY, Frankenstein
Author’s Note
Some books are born out of big, abstract ideas; others start closer to home. My last book, Makers and Takers, came out of high-level policy conversations about the financial industry. This book, which examines the economic, political, and cognitive damage wrought by the technology industry over the past twenty years, has a wide lens. But its birth was quite intimate.
It began one afternoon in late April 2017, when I came home from work, opened my credit card bill, and got a shock: over $900 in charges I didn’t recognize from Apple’s App Store. First, I thought I’d been hacked. After making a few inquiries, however, I discovered that, in fact, my then ten-year-old son had racked up these charges, buying virtual players for the online soccer game he had become fond of.
His devices were summarily confiscated and passwords revoked, needless to say. But right around that time, the larger implications of this incident were beginning to consume my time and attention, albeit in a different way. I was starting a new job, as the global business columnist for the Financial Times, the world’s largest business newspaper. My mandate was to write a weekly column about the biggest economic stories of the day. And most turned out to involve the Big Tech behemoths of our era, companies like Google, Facebook, Amazon, and, of course, Apple.
It’s no secret that the concentration of market power has been rising in numerous industries over the past few decades, a trend that has been linked to everything from growing income inequality to slower economic growth to a surge in political populism. But as I settled into my new role at the FT and began digging into the financial data, I discovered something rather shocking—that 80 percent of corporate wealth was now being held by just about 10 percent of companies.1 And these weren’t the firms that owned the most physical assets or commodities; they weren’t the GEs or the Toyotas or the ExxonMobils. Rather, they were those that had figured out how to leverage the new “oil” of our economy—information and networks.
Many of these new superstars were technology companies. The tech industry provides the starkest illustration of the rise in monopolistic power in the world today. Ninety percent of the searches conducted everywhere on the planet are performed on a single search engine: Google.2 Ninety-five percent of all Internet-using adults under the age of thirty are on Facebook (and/or Instagram, which Facebook acquired in 2012).3 Millennials spend twice as much time on YouTube as they do on all other video streaming services combined.4 Google and Facebook together receive around 90 percent of the world’s new ad spending, and Google’s and Apple’s operating systems run on all but 1 percent of all cellphones globally.5 Apple and Microsoft supply 95 percent of the world’s desktop operating systems.6 Amazon takes half of all U.S. e-commerce sales.7 The list goes on and on. Everything in Big Tech goes big or it doesn’t go at all—and the bigger it gets, the more likely it is to go bigger still.
* * *
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THE WEALTH REAPED by the digital giants has been extraordinary. The market capitalizations of the five so-called FAANG companies—Facebook, Apple, Amazon, Netflix, and Google—now exceed the economy of France. Measured by users, Facebook alone is larger than the world’s largest country, China.8 But as the big have gotten bigger, the rest of the economy has suffered. Over the past two decades, as Big Tech has grown, more than half of all public firms have disappeared.9 Our economy has become more concentrated, and both business dynamism and entrepreneurship have declined.10
As I wrote and reported, raising concerns about all of this in the pages of the FT, I felt growing unease over the things I was hearing from a broad swath of people—workers, consumers, parents, and investors—who felt that Big Tech was putting their livelihoods or even their lives (or those of people they loved) in jeopardy. There were the mothers and fathers who struggled with tech-addicted children. The workers who’d lost jobs when their businesses went bankrupt trying to compete with Amazon. The entrepreneur who had his ideas and intellectual property stolen by a competitor and lacked the funds to bring his complaint to court. The homeowner who was denied property insurance because the provider’s algorithms determined he was too high a risk. Then there were those who simply felt that the entire tech industry wasn’t sharing enough of the wealth pie fairly.
And what a pie it is. Big Tech firms are now the richest and most powerful companies on the face of the planet. The inherent desirability of their various products and platforms, coupled with the network effect, in which more users beget still more, and all the data that they harvest as a result, has allowed them to scale to unimaginable dimensions. They have used their size to crush or absorb competitors, to commandeer the personal data of their users, and—in the case of Google, Facebook, and Amazon—to leverage it for their own benefit in the form of
highly targeted advertising. They and other Big Tech firms have also offshored much of their exorbitant profit—according to one estimate done by Credit Suisse in 2019, the top ten companies offshoring the most savings, including Apple, Microsoft, Oracle, Alphabet (the parent company of Google), and Qualcomm, had $600 billion sitting in overseas accounts11—circumventing the laws and regulations by which ordinary citizens must abide, but which the largest corporations can legally eschew. Silicon Valley has lobbied hard to preserve the tax loopholes that allow all this, bringing to mind the words of economist Mancur Olson, who warned that a civilization declines when the moneyed interests take over its politics.12
Certainly, many public officials I spoke with echoed my concerns. Silicon Valley was, after all, built around government—that is, taxpayer—funded innovation. Everything from GPS mapping to touch screens to the Internet itself came out of research originally done or funded by the U.S. Department of Defense, and was later commercialized by Silicon Valley. Yet unlike many other countries, including a number of thriving free markets such as Finland and Israel, the U.S. taxpayer does not reap a penny of the profits these innovations yield.13 Instead, these companies were offshoring both profits and labor at the very time that tech titans were asking the government to spend more money on things like educational reform to ensure that the twenty-first-century workforce would be digitally savvy. The consequences are not just economic; by fueling populist discontent with capitalism and liberal democracy, they have high-stakes political ramifications, too.
For someone who’d been tracking the financial industry closely since 2007, the parallels were fascinating. There was a new too-big-to-fail, too-complex-to-manage industry out there, one that had grown like ragweed right under our noses. It had more wealth and a bigger market capitalization than any other industry in history, yet it created fewer and fewer jobs than the behemoths of the past. It was reshaping our economy and labor force in profound ways, turning people into products via the collection and monetization of their personal data, and yet went virtually unregulated. And much like the banking system circa 2008, it was flexing its considerable political and economic muscle to ensure that things stayed that way.
As I began looking more closely at these companies, which were already under fire in the wake of revelations about the 2016 election results, a picture began to form. As we now know, the largest technology platform companies in the world, including Facebook, Google, and Twitter, were exploited by Russian actors to manipulate the results of the U.S. presidential election in favor of Donald J. Trump. These platforms were no longer just places to search for cheap airfare, post vacation photos, or connect with long-lost family and friends. Instead, they had become tools for manipulating geopolitics and swinging the fate of nations—while enriching their executives and shareholders in the process. The innocence of an earlier era was behind us.
That’s an important point to remember, because when it comes to the tech industry, it hasn’t always been all about the money. In fact, Silicon Valley was heavily influenced by the counterculture movements of the sixties, with many entrepreneurs inspired by a vision of a future in which technology held the power to make the world a better, safer, and more prosperous place for everyone. The “digital utopians” preaching this vision adhered to a strict gospel: that information wanted to be free, and that the Internet would be a democratizing force, leveling the playing field for us all. There was a time when the high priests of the Internet were not cited on Forbes list of the richest people on the planet; rather, they were cited across the newly created blogosphere as the creators of Linux and Wikipedia and other open-source platforms, communities built on the assumption that trust and transparency would prevail over greed and profit.
All of which raises the question: How did we get here? How did an industry that had once been scrappy, innovative, and optimistic become, in the span of just a few decades, greedy, insular, and arrogant? How did we get from a world where “information wants to be free” to one in which data exists to be monetized? How did a movement built on the goal of democratizing information come to all but destroy the very fabric of our democracy? And how did its leaders go from tinkering with motherboards in their basements to dominating our political economy?
The answer, as I soon came to believe, is that we reached a tipping point in which the interests of the largest tech firms and the customers and citizens they supposedly served were no longer aligned. Over the past twenty years, Silicon Valley has given us amazing things, from search to social media to portable devices with astounding computing power. We hold today in our pockets more computing intelligence than entire companies had access to just a generation ago. And yet, these modern conveniences have come at a steep price: twitchy technology addiction that saps our time and productivity, the spread of misinformation and hate speech, predatory algorithms targeting the weak and vulnerable, a total loss of personal privacy, and the accumulation of more and more of the country’s wealth by a smaller and smaller subset of society.
What’s more, all of these problems—while often spoken about in isolation—are intertwined. There was a single, inescapable problem: a business model based largely on keeping people online as long as possible, and monetizing their attention. That’s something that many people in the Valley didn’t want to acknowledge. The “attention merchants,” as Columbia University academic Tim Wu has labeled Big Tech firms, use behavioral persuasion, troves of personal data, and network effects to achieve monopoly power, which ultimately affords them political power, which in turn helps them hold on to their monopolies.
In the past, Facebook, Google, and Amazon have been given regulatory get-out-of-jail-free cards. After all, the logic goes, Google provides its searches for “free.” Facebook is “free” to join. And Amazon cuts prices and gives away products for free. Isn’t that good for consumers? The problem is that “free” isn’t actually free. We don’t pay for most digital services in dollars—but we do pay dearly, with our data and our attention. People are the resource that’s being monetized. We think we are the consumers. In fact, we are the product.
* * *
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OF COURSE, THESE are problems many leaders in Silicon Valley don’t much want us to land on. Too many powerful people there remain in a cognitive bubble, reluctant to engage fully and transparently with legitimate public concerns, including safeguarding our data, whether artificial intelligence and automation will take too many jobs, our loss of privacy as our location is tracked on a second-by-second basis by thousands of apps, election manipulation, and even what the shiny devices that permeate every aspect of our lives today are doing to our brains. When I ask most techies about these concerns, reactions tend to range from defensive to naïve to clueless or, the worst of all, a patronizing smile or exasperated look that says “You’re not a tech insider, and thus you just don’t get it.”
But it may be the tech executives themselves who don’t get it. As John Battelle, who helped launch Wired magazine, once put it to me, “The tech community doesn’t have a good perspective on itself. We aren’t humanists or philosophers. We are engineers. To Google and Facebook, people are algorithms.”14
It all seems too familiar. I am old enough to have lived through one big boom-and-bust tech cycle, having worked for a high-tech incubator in London from 1999 to 2000, an experience I’ll describe in a later chapter of this book. Then, as now, the industry was talking mainly to itself. The hubris we see today has reached levels we haven’t seen since the years leading up to the dot-com collapse—only this time around, it’s more pernicious, given that companies like Amazon and Apple have become mainstays in just about every household in America. Like the big Wall Street banks, they hold vast amounts of money and power and even greater troves of data. Yet, unlike Goldman Sachs chief executive Lloyd Blankfein, they are not joking when they claim to be doing God’s work. Attend any tech conference and you’ll quickly learn that many in Silico
n Valley still subscribe to the notion that they have made the world more free and open, despite plenty of evidence to the contrary.
The Valley has clearly moved away from its hippie, entrepreneurial roots. Big Tech chief executives are as rapaciously capitalist as any financier, but often with an added libertarian bent. Theirs is a worldview in which anything and everything—government, politics, civic society, and law—can and should be disrupted. As Big Tech critic Jonathan Taplin once put it to me, “Demos—society itself—is often viewed as being ‘in the way.’ ”15
So why haven’t our political leaders imposed any sensible regulations to hold such instincts in check? Follow the money. Not for nothing that Big Tech now vies with Wall Street and Big Pharma as one of the top spenders on political lobbying. Just as, in the years before the 2008 financial crisis, the world’s top bankers dispatched surrogates to Washington, London, and Brussels to live among and lobby the legislators in charge of regulating them, so Silicon Valley faces have become the most familiar ones in these capitals over the past decade—with Google dispatching so many emissaries to Washington that they needed office space as large as the White House to hold them all.16
But despite the efforts of scores of Silicon Valley lobbyists and PR teams, the public worries about the economic and social effects of technology, and those worries are not going away.17 In fact, they are increasing, as the technology itself spreads more deeply into our economy, politics, and culture. Big Tech has become the new Wall Street, and as such, is the prime target for a populist backlash in a world increasingly bifurcated, economically and socially.
The changes Big Tech has wrought have become one of the most pressing economic issues of our time. Harvard Business School professor emerita Shoshana Zuboff and other scholars have decried the rise of “surveillance capitalism,” which is, as Zuboff defines it, “a new economic order that claims human experience as free raw material for hidden commercial practices of extraction, prediction and sales,” as well as “a parasitic economic logic in which the production of goods and services is subordinated to a new global architecture of behavioral modification” via digital surveillance technologies.18 She believes (and I would agree) that surveillance capitalism represents a significant threat to our economic and political systems, as well as a potential instrument for social control.19 I’ve also come to believe that curbing Silicon Valley’s nefarious side effects will become “the signature economic issue [for lawmakers] over the next five years, especially as automation increases and they make investments into other areas of the economy,” as one staffer for an influential senior Democratic senator has put it to me.
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