The surveillance economy is more like the commoditization economy
18 May 2020
If we want to do anything about the surveillance economy problem, it helps to try to figure out why it's so important to so many people to do surveillance marketing working definition of surveillance marketing: any database marketing database marketing where some or all of the data used is derived from surveillance instead of other kinds of marketing. One way to look at it is that it's not about the surveillance. Surveillance is a tool in a more complicated process. Today, the surveillance marketing business looks like the Establishment, but it used to be cool (business cool anyway) back when it was emerging from the open source scene of the late 1990s and early 2000s.
Madison Avenue fell asleep, direct response
marketing ate its brain, and it woke up as
an alien replica of itself. Part of that was
driven by the realization that the same Commoditize Your Complement strategy that applies to device drivers can also apply to every business, everywhere. It's more of a commodification economy than a surveillance economy, but we got started saying surveillance economy so we might as well stick with it.
The general direction of the "surveillance economy" is to build a system where reputation graphs gain sustainable value, and goods and services (whether they're PC hardware, or software, or songs, or news stories, or home delivery of stuff) lose value until they become commodity nodes on someone else's reputation graph. Information goods such as software code can and should be public, while reputation graphs are hidden by legal restrictions, complexity, and scale. And there's a reputation graph for everything. Amazon sellers. Uber drivers. News sites. The same adtech companies that facilited content commoditization in 2014 are facilitating content commoditization today. Web adfraud is just as necessary for web adtech as extra drivers cruising around are necessary to Uber.
The first market in information goods to get commoditized was the slothful, overpriced Unix business, which was already being starved of investment as CIOs and analysts talked up the inevitability of Windows NT. When Linux came along, the commodity was an improvement. Naturally, when the commoditization strategy worked in one business, the winners went on to apply it elsewhere.
Use a stack of janky PC hardware instead of splashing out on a Digital Unix server: cool hack
Use a stack of miracle cure peddlers instead of splashing out on a star MD: maybe not so much
YouTube doesn't show you videos about drinking bleach because they want you to drink bleach. They show you videos about drinking bleach because the recommendation algorithm is set up to avoid creating the kind of powerful stars who tend to emerge on other media. The bleach-drinking advocacy is just a side effect of a system designed to steer you away from any content creator who might develop market power.
Algorithms that artificially boost "long tails" in content We can see this happening but it's hard to quantify from the outside. We won't see it for real until the discovery phase of some ugly lawsuit over some tragic event. are an essential part of the commoditization strategy. For a platform company, fraudulent and misinfo content doesn't look good in the PR clippings, but it's manageable if you can get enough Serious People to write slick PDFs about how it's an Industry Wide Problem. Allowing the algorithm to let user preferences create bankable stars would be a real threat.
For every bad thing on the Internet, there is an "if this goes on" dystopia story. If the surveillance economy keeps going the way it's going, we'll all end up working for and buying from one big company built around a really complicated reputation graph that measures who can catch the tastiest rats in the ruins of civilization. But no dystopia narrative runs out all the way (yet). Just as the surveillance economy dystopia narrative mostly ended the IP Maximalism dystopia narrative, we're going to get a new one.
So that's the fun part. Which marketers will manage to de-commodify themselves? (Maybe think economic signal, using the whole customer including their own hard-wired monkey brain ability to process reputation and how brands are a cognitive hack on that, and so on.) One piece of good news. Section 230 of the Communications Decency Act helps platform companies enable commoditization, but other laws and regulations are giving us tools to resist it. More on that soon.