by George Paolini

It’s time for Silicon Valley to grow up

Jul 01, 2019
BlockchainTechnology Industry

For all too long, Silicon Valley has operated under the laissez-faire notion that the world is just one big beta-test and that conventional rules don’t apply. Finally, a prominent member of the community is calling for change.

“Move fast and break things. If you’re not breaking things, you’re not moving fast enough.”

—Mark Zuckerberg, CEO, Facebook

When I first started working in Silicon Valley in the early ‘90s, a colleague shared some salient advice: “If you see an opportunity to do something, just go do it. It’s quicker in the long run to beg forgiveness after the fact than to seek permission before.”

The company I worked for, Sun Microsystems, was on fire back then. Revenue was doubling every year; its market capitalization was larger than the reigning king of the hill at the time, IBM.

My co-worker’s advice made sense in that context. Then the dot-com bust happened. Things changed. What works on the way up doesn’t necessarily work on the way down.

Sun went out of business just as Facebook was coming to town. And, in fact, the social media giant moved right into the defunct computer company’s former headquarters in Menlo Park. 

All this is to point out that as pithy as Mark Zuckerberg’s quip might be, it’s nothing new. He didn’t invent this mode of thinking. Silicon Valley has always had a bit of Wild West swagger: shoot from the hip and ask questions later.

It really just boils down to disrupting the status quo. It has been spouted in conference rooms from San Francisco to San Jose since William Shockley, the co-inventor of the transistor and an iconoclast if ever there was one, founded his semiconductor company in Mountain View in 1956.

Shockley, by the way, once said: “Regret is unnecessary. Think before you act.” Silicon Valley seems to remember the first part, but not the second.

Move fast, beta test, fail often, disrupt

Disruption is the Holy Grail in high tech. Better, faster, cheaper, more efficient. Cut out the middleman. This Machiavellian approach is to pull out all the stops to give your customer something they didn’t even know they wanted.

When you are disrupting, you are out to gain market share. You don’t worry about the consequences.  You let the chips fall where they may. That’s just collateral damage. You only care about disrupting. No regrets.

Oh, and if there are rules that stand in your way, you have three choices:

  1. Change them
  2. Ignore them
  3. Break them

Follow the rules? That’s for losers. (In Silicon Valley, the only true law is Moore’s.)

But we can’t just blame the Silicon Valley mindset on the tech giants and other companies providing the goods and services. After all, Econ 101 tells us it is all about supply and demand. As consumers, we have to admit that we are enabling companies to continue down this path.

Whether it’s AirBnB giving hotels a run for their money, Uber undercutting taxis, Netflix unseating cable TV, Tesla taking on the auto industry, we champion the “little guy,” the David vs. the Goliath.

It’s also the self-serving way. We want better and faster. We want cheaper. Hell, we want free. The big technology platforms are all too willing to comply, as long as you don’t mind free meaning that you — and every piece of data about you — can be mined and thereby monetized.

So, Zuckerberg & Company simply and dutifully supplied what was demanded.

The platform that was designed and built for ranking college coeds turned out to have a more general application, that of connecting friends, families, communities and businesses. It now spans the world with over 2.3 billion users.

But, as it also turns out, things like social platforms don’t necessarily scale so simply.

Imagine living in a small town where you and your new neighbors can leave doors unlocked. Then, overnight, the town grows into a mega city and burglaries are rampant. Now, everyone needs locks on their doors. The only problem is, none exist. They weren’t designed for this city. No one thought that far ahead.

Facebook is just one of many companies that has created a platform without following Shockley’s advice: Think before you act.  Ultimately, it’s not about Moore’s Law. It’s about another law. The one belonging to Murphy.

The litany of problems that have transpired over the past two years for Facebook and its users, ranging from Russian trolls influencing elections to data security and data privacy scandals, hate speech and voter suppression, is a clear indication of that.

That which can go wrong, will go wrong, especially when your mantra is “break things.”

A voice of sanity in the wilderness

And this is why Tim Cook, the CEO of Apple, a company borne of Silicon Valley soil and now one of the largest companies on the planet, is saying things have to change.

In his commencement speech at Stanford University a few weeks ago, he was quite blunt about it.

“…if you’ve built a chaos factory, you can’t dodge responsibility for the chaos. Taking responsibility means having the courage to think things through.”

I couldn’t have said it better myself. But Shockley could: “Think before you act.”

Cook’s comments were unmistakably aimed directly at Facebook. The two companies have been partaking in a war of words for some time now, so this is no surprise. But the fact is, Cook is right. And, as the old saying goes, if the shoe fits, wear it. His comments should resonate for many, if not all, of the major social medial platforms.

For Facebook specifically, it is today just shy of a public utility. With the majority of the developed world depending on its platforms, it’s time for Facebook to take on that responsibility.

Other than creating a “war room” to address the situation and going on PR campaigns, what is the social media giant doing? It’s entering an even riskier business.

Facebook, which has yet to prove it can be trusted with user data, now wants to be handed the keys to the vault that hold the user’s hard-earned dollars.

That’s right. Facebook wants to become “Facebank.”

Not surprisingly, with the announcement of its hybrid, blockchain-style crypto currency called Libra, Facebook is immediately under scrutiny. Questions abound, such as:

Is it blockchain or isn’t it?

Whereas blockchain and existing cryptocurrencies are based on the distributed ledger system that provides a level of assurance via the distributed system itself, Facebook is proposing some new “permissions-based” system. Who gets what permission? How is this going to be tested before being released?

Whose data is it?

Given Facebook’s propensity to share data with its other platforms and even third parties, what’s to stop Facebook from harnessing user transaction data from its cryptocurrency ledgers and selling that to advertisers?

Whose coin is it?

The cryptocurrency will have some of the properties of “stable-coin” (a cryptocurrency that has its valuation tied to an existing currency) but Facebook is, again, proposing a variation on the theme, an alternative to this model. It wants to tie its currency to some bundle of assets, as of yet undisclosed. How exactly will that work?

These are but a few of the questions that have already arisen.

The bottom line is Facebook wants to sidestep its current mess and try its hand at disrupting a new business, one with which it has no experience. Let’s revisit Murphy’s law and ask: What could go wrong?

So, it’s little wonder lawmakers in the US and Europe — even before the Libra announcement — had been making more and more noise about new regulations, perhaps even breaking up the mega technology platforms. As noted, Facebook is not alone. Pick any of the platforms, and you can find similar security breaches among myriad other problems.

It’s as though the regulatory bodies are saying that if 60-year-old Silicon Valley wants to act like an irresponsible teenager, then we’ll treat it like a teenager. Maybe a “grounding” is in order.

Or, maybe it’s time for Silicon Valley to grow up.