Friday, March 17, 2017

The Internet is worth how much??

Do you ever see headlines that make sweeping claims such as “The Internet is worth $_______”, and then wonder what that even begins to mean?

If so, today is a day of edification, because a study I co-authored on precisely this topic was released this week.

When you are a hybrid such as I am, it is often tricky to explain what it is that one does. And when the project is quantifying the economic value of the Internet, the conversation can get even more convoluted.

So I had to come up with a way to describe the project to people, just well enough to satisfy their basic curiosity, but not so detailed as to bore them to tears. I came up with the following:

Think of the Internet as a framework that starts on the left side of the doodle below (yes, I’m the artist) with the Internet backbone on the left side and you, the user, Craigslisting and Instagramming away on the right hand side of the picture. 

My early conceptual doodle for this project; Click to enlarge

In between the Internet backbone on the left and you and your smartphone on the right lie the various components of the machinery of the Internet, from infrastructure, such as the provisioning of broadband, wi-fi, and cloud storage, to the advertising and marketing technologies (aka ad tech and mar tech) that enable the movement of money between brands and the the consumer-facing layer of the Internet. That's just a fancy way of saying the only part of the Internet most of us ever come into contact with, as that’s where we find things such as news and information sites, entertainment such as games and video sites, and eCommerce.

The big picture is one in which the Internet as a market-making machine can be conceptualized and then analyzed at micro and macro levels. This makes possible an assessment of its impact on not only the economy writ large, but also the effects of networked connectivity on particular industries, plus less black and white outcomes such as societal good, in the form of things like crowdsourced problem-solving and civic engagement apps.

The TL;DR answer to what all this adds up to, for the U.S. economy, which was our task with this project: $1.12 trillion contribution to the GDP of the U.S. and 4.1 million full time equivalent jobs (and an additional 6 million full time equivalent jobs in what economists refer to as indirect employment). How this was accomplished is explained in detail in the study, but rest assured many, many spreadsheets and models were constructed.

Fun with spreadsheets; all part of the job of determining the scope of Internet-dependent activity 
The mapping of the economic model of the Internet evolving, on my floor, Summer 2016

And if that wasn’t enough, we mapped the Internet-dependent employment to congressional districts in the U.S.

Image from

For those who are curious, see the methodology section of the study (Chapter 2, pages 17 through 20), which explains the methods used and assumptions made to arrive at this figure.

And for those in a bit of a rush here are some highlights to provide an overview of our findings, placed into the context of the last time this study was conducted (2012) and now.

Click to enlarge
Click to enlarge

 To see the study in its entirety, just click here. But be forewarned; It's 118 pages long.

Wednesday, March 1, 2017

Taking on the fake news industrial complex

If there’s one thing most (reasonable) people agree on it's that post-truth is the new norm. The resulting uproar about ‘fake news’ is about more than just subjective narratives, because in a digitally interconnected world, stories spread with the force of not one or two or three media outlets, but via thousands if not millions of retweets, shares, posts, and comments.

My conference badge, should you choose
to believe it
Against this backdrop emerged last weekend's Misinfocon, an event that brought together journalists, technologists, software developers, academics, advocates, investors, a counterintelligence expert working for the Department of Defense, and even a bona fide fake news site creator (more on that coming up) at MIT’s Media Lab. In addition to support from a variety of journalism organizations and tech companies, the event received funding from the charitable foundation established by Craig “Craigslist” Newmark, whose classifieds free-for-all site ended up, quite unintentionally, removing the revenue stream that once subsidized the entire newspaper, i.e. the classifieds ads.

“There’s a lot of emotion around the topic of information right now”, said Jeanne Brooks,  one of the event’s organizers. “And there’s a lot of mistrust in media, right or wrong, and we have to design to support a deeper understanding of facts”, Brooks continued. “We have extremes to overcome.”

First up in getting to an understanding of the landscape was Claire Wardle of First Draft News, one of several Google-backed initiatives to assist with fact-checking, verification, and stemming the proliferation of misinformation and disinformation online.

Let’s start with some all important definitions, courtesy of First Draft News, because there are several nuances to take into consideration in order to analyze the situation at hand.

Misinformation vs. Disinformation courtesy

A taxonomy of fake news content, courtesy

And while we may think the fake news industrial complex --  and yes there is one -- is ‘all about the Benjamins', the crew at First Draft News did an impressive job of mapping out the full range of motivations involved, many of which have little if anything to do with dollars.

The "Ps" of fake news, courtesy

It’s also easy to place the blame on the Internet, for democratizing the flow of information by all but eliminating the costs of having global reach with a picture, post, or story, but of course that’s like blaming a knife for being good at slicing a tomato and also for often being implicated in killing people.

Nevertheless, twenty plus years into the consumer Internet the full ecosystem has developed, with legitimate information flowing through the same pipes as misinformation and disinformation, and increasingly automated advertising systems enabling b.s. to become a business model. We’re not just talking “…and you’ll never guess what happened next” clickbait, but intentionally misleading, and often malicious information, and the more ridiculous the better, if better is measured in clicks, as clicks mean the ability to serve ad impressions to s/he who has clicked. As but one example, from such a universe was born Pizzagate, a particularly quacky conspiracy theory implicated high ranking individuals in the Democratic party a pedophile ring run out of a Washington, D.C. pizza parlor. Think of the story and its millions upon millions of shares on social platforms as a click factory that not only furthers partisan causes but creates a digital advertising jackpot for those central to the story’s dissemination.

And on this note, one of the most intriguing people I encountered at Misinfocon was a former fake news site publisher. Yes, former. I won’t mention him by name as after being outed he had angry citizens showing up at his house and even received threats against himself and his family. If you had to pick the publisher of a fake news site out of a roomful of people chances are you would not pick this guy. Unassuming, fairly quiet, maybe around 40, with a full time job and 2 kids, he told our breakout group he would typically spend 1 to 2 hours per night posting stories that were deliberately designed to incite rage and in turn bring in dollars by way of his Google Ad Words account. Did I mention he’s a self-described liberal? Well he is. That’s who was running a vehemently anti-Democrat site that pulled in 100 million views and about $200,000 in ad revenue over the course of its short existence. “It was an addiction”, he said. “Watching my analytics page in real time after I posted a story was my fix."  

But how did he do it? There are millions of blogs and sites out there and most of them get very little traffic. “I studied the audience deeply”, he revealed, going to the sites of the likes of Alex Jones, Sean Hannity, and Glenn Beck, and learning the keywords and the hot button topics. “I could often identify trends in advance, and anything anti-institutional tended to be a winner.”

We often think of Twitter as being the linchpin in making things go viral online when this fake newsman said he rarely got any traction on Twitter. “Too many educated, left wing elites and journalists."  He feasted instead on the buffet that is Facebook groups, particularly those with large memberships of white males over the age of 55. “Fake Facebook accounts are the bread and butter of spreading fake news”, he pointed out, with the irony not being lost on most of us in this particular breakout group that Facebook initially differentiated itself from its arch competitor MySpace by insisting that people use their real identity

It turns out that with a carefully crafted Facebook persona one can plant the kinds of stories that speak to people’s fears and biases and the audience takes care of the rest: sharing, re-posting, and fanning the flames of outrage. “I didn’t need to buy a spam farm or bots. I created my own, with 2 Facebook accounts with pictures of fake people with their fake kids.”

That’s crowdsourced distribution for you. 

The party did eventually end, though, and Google closed down his account. Of course there are hundreds of other ad platforms to work with, and he tried some of those in the aftermath of his Google ban, but he never came close to making the kind of money he did via Google.

By this time you’re probably wondering what the forces of sanity can do against the forces of click-based commerce hiding behind the cloak of news reporting, and I’m happy to report that there are several initiatives at work, such as:

On a systemic level there are also issues to be broached with the platforms that benefit from user-generated content, content discoverability, and its monetization – namely Google, Facebook, Twitter, and the Google-owned YouTube. Bear in mind that the platforms benefit greatly from surges in traffic, regardless of their origin. Facebook gets to say we serve 1.8 billion people globally, YouTube gets to say that billions of hours of video are viewed per day on its platform, and both share in the ad revenue generated by the traffic to their sites.

Pieces of the solution might take the form of funded research and fellowships and sponsored initiatives in such fields as journalism and media literacy, but, as one conference attendee close to the issue put it, “Mark Zuckerberg would happily contribute tens of millions of dollars to media literacy programs tomorrow, but that is not the answer. It takes the onus off of him and Facebook. What’s really needed is something that dampens virality and the incentive system.” And as we learned from our fake news making friend earlier in this post those incentives can be darn attractive.

Sample idea wall from Misinfocon
But what comes from a weekend of impassioned debate and a frenzy of ideas captured on pink post-it notes? A totally reasonable question, and you can learn about the plans and action items that came out of Misinfocon by clicking here