Host is so good to see you. Is so good to be here. I love the book is incredibly important the basic question in the first section of the book what is surveillance . What is your definition . Lets start with that. Back up a little bit and give a tiny bit of context has long been understood that in the history of capitalism the key way that capitalism evolves is by taking things that live outside the marketplace and outside the Market Dynamic to bring that into the market and as a state same historian wrote about the basic mechanisms of industrial capitalism and the idea was human activity that was claimed for the marketplace that made it possible for labor to be controlled and to be bought and factory work in all of those that became the hallmark of modernity and was reborn as real estate or early and so lets fastforward a century not the beginning of the 21st centur century, the insight was capitalism was invented we could take Human Experience specifically private Human Experience and we can bring that into the marketplace as behavioral data. Host so google and facebook say we can sell that in aggregate. We are coming into this space a private experience uninvited typically in ways that are secret and designed to invade your awareness we are registering your experience in a variety of ways and when we are trained to put that into the data that can be fed into our production process that Machine Intelligence goes to work to produce predictions i call it production on prediction products of your behavior and what you will do now now and later those prediction products are sold in two new kinds of markets that exclusively behavioral future as a new kind of derivative. One thing that struck me in the happening on in the opening of the book and it changed who we are with the factory workers surveillance capitalism is because those predictions. Do you see that connection fully realized where we in that spectrum . You ask such an interesting question because this really goes to the heart of the book because my a space in the book is that we dont understand the mechanisms and internal logic so this moves beyond economic beyond the commercial and the business side of things to create a new vision of society and an industrial world by industrial capitalism we had a vision of society that many viewers will remember like Charlie Chaplin with a new vision of Society Networks like clockwork and a factory where its not only mass production and mass consumption everybody has their role to play and their part to make a contribution thats very hierarchical and so forth and conformity and all of those values the social qualities that came out of the nature of industrial capitalism so what is the social vision of surveillance capitalism . And my argument is that stems from the whole Machine Learning framework to have various computers and devices so imagine self driving cars and a fleet as the intelligence of the cars learn something its not like one of the cars learns and the others are on an individual learning curve soon as one car learns they all learn there is the essential hard to go on reading the data and back to all the individual parts so the point is they all learn the same thing and they all move in the same direction as far as the learning goes and then to not stop bad a train crossing then all of them are learning the same thing. This is the hive mentality the hive structure and as i have studied how surveillance capitalism themselves think about society and how those breakthroughs will be transposed to the control and functioning of society that society itself becomes a organization were all in tune with the front tier of Machine Intelligence at any given moment Machine Learning taking place that is translated through the digital surround to all the devices and all the things that surround us those digital interfacing and in a variety of ways they are nudging and coaxing and hurting us and shaping and modifying our behavior in the direction of this one learning we are talking about surveillance capitalism so the learning isnt just learning for learnings sake not for better commercial outcomes but the other piece of the puzzle is that we are learning to be shaped and modified to move together in the direction with the commercial outcomes that they see. Host i always wonder the primary one that i find myself asking as i read your book is fundamentally who are the customers . We buy ad tracking . Because at some point we have to make that transaction to make it more classical to buy a product or service seek and pay for that advertising so if you think of those commercial outcomes how do you see those that are changing in the model you describe . This is so important. What we are seeing is going through the economy to their economic sector so that was invented and elaborated and spent the facebook and was the default model. Host can i quote you . You have a great like google invented and perfected surveillance capitalism in the same way that gm invented and perfected managerial. You are right with me because here is where i am going right to gm and ford. So first the default model the logic of accumulation for Silicon Valley because they dont have an obvious product and there are many ways that these companies could have figured out how to modify and value and institutionalize the Value Proposition for actual people who are now called users. That they didnt do that because as soon as this path was discovered as the crow flies they skipped over those difficult Institution Building that they describe they took that snippet about Creative Destruction and left behind all the important learning about the years and decades and centuries it takes for those new models of Economic Production that aligned with the real needs of people in society. Straight to the new monetization process for now because of surveillance has been so lucrative and startling successful we see companies in every sector migrating in this dissection and there is where we come full circle to ford motor where mass production bega began, with the breakthrough to the model t back in the early days of the 20th century. Now is our viewers well now the Auto Industry is in a global slump and car sales are that there is no way out of this on the horizon the ceo of ford motor is now saying the new path to profit margin from Ford Motor Company will be monetizing data from their driver and what he says as we have 100 Million People driving cars with the little blue ovals. 100Million People in vehicles driving these ford cars and hes really excited about the amount of data we can get from these vehicles and he says we have ford credit and we already know everything about it. So now we have put together what you are doing in your car what you are saying where you are going in your car we put that together with all the Background Information we have about you and how you shop your mortgages and Financial Information and we have this deep dive data and he says to wouldnt want this data . Even the data that we can leverage so what happens if you ask about products what happens in this situation as we see in all kinds of situations is the product becomes a loss leader it is a supply chain interface and so this began with the strategy way back when the android was sold at a much lower price point and to create the opportunity as possible for all the data that could come with mobile so give it away if you can. Definitely low cost because its the data gathering device the supply chain. And with the android strategy and the twist and turns and they say everything you are saying and those goals are exactly as they describe that they are tone and optimism. So google made eye on android and gave the license for free. Microsoft has a monopoly in this market and then google might disappear and with that User Experience to search and then we dont charge anybody for a. Then we can leverage that. And then you describe the endpoint. And then you talk extensively in your book. And to any intelligent cloud. And then to have Smart Devices at the edge depending on the day right now. So they are saying these things so im trying to get at is the difference between their excitement and they are being rewarded for it. And your warning what is that difference . What about that specifically . Such an interesting question. I think there are a couple things to say about that. What on one is you are right they say the seams with the public pitch and public euphoria. They also say other things to each other and occasionally they may the journalist at pro public a than the times and the guardian and just so many journalists in my view who have died heroic work into the situations plussign a listen to earnings calls and all kinds of sources that are not typically produced by the reading public. That over the years we see the internal reports. So theres also a difference between what they say in a press release and what they say internally even in the case of android in the book i include some telling quotes about the android strategy at the time some people in google are arguing we have to make our margin on this phone its crazy to sell it so cheap and others say no. If we can get data for this phone its worth it to us to give it away. The second point surveillance capitalism is an economic logic that has been carefully concealed designed to be indecipherable and hidden and for the ignorance of the people who have now been converted into the sources of raw material and the behavioral data is raw material now we are the free source of raw material once without the services were free but now they think we are free so we have gone to that. So once you understand how the piece of surveillance capitalism work how they articulate and work together, then you understand unless you get more data at scale and scope and that we talk about in terms of the economies of action that i write about, they cannot make competitive predictions and without predictions, they cannot be successful in future behavioral marketplace. All of this depends upon the data flow. So once you begin to take those same lines with this smart and jan smart cloud once you put them into the context of how this logic really works , they become alarmingly revelatory. [laughter] but until you understand thi this, just seems like every other piece if you put one piece together that another and slowly it emerges. So i look at it the fable of the blind man and the elephant. Really i spent the last seven years trying to mask the elephant and i think once you get the picture of the elephan elephant, this changes and you can never rebuild those liens again without hearing and understanding something very different from what they thought they were conveying to the public. Host i will push him out a little bit. Of course i do agree with you, but you talk a lot about the 1000 contracts you are signing that you have to enter into so lawyers and these contracts and with those references and none of that is back to. But at some point he signed the contract and that provide some utility to you that you may not have gotten if it was that system we know in the region it is taking one spiking we know how long it takes for the house to heat up we will run it earlier shut it down slower because we cant predict your specific model of furnace. So as far as i can tell google and amazon provide an enormous amount of utility and then the crisis seems to be shifting utility for some of the services does that outweigh the trade we are making . My argument is the utilities are granted and so we always hope for with the digital. So let me give our viewers a quick example. I began the book with the example of a where home is a project Computer Science engineers georgia tech and it was all about in this where home with many of the same goals to inform the occupants of the process and the abilities to optimize how the home runs and functions maybe its more efficient and effective, also things that can aid the occupants with their health and communication with families and all of those things. When the internet put together the schematics the idea was a simple closedloop. One is the sensors embedded in the home itself and the other is the occupants of the home. And the designers imagined another device the occupants had all the data from the home went to the occupants and then they had tools to figure out what it means and what if anything to do with the data and so forth. That is the counterpoint which as you noted the analysis says if youre going to be vigilant you will have a thousand and privacy policies to review the more importantly, if you dont agree to the nest Privacy Policy you have it on your wall that you are losing the functionality that you look forward to in the first place and stop supporting the system and stop updating it and they actually say things can happen maybe your pipes will freeze or something will go wrong because the functionality is no longer going to be supported. So now there is a quid pro quo a hostagetaking that my data in return for the functionality. We can keep talking about what is the harm having all my data because thats a very important conversation but for now lets just assume i have arguments i believe are compelling that there are harms that go beyond known harms and economic harms but the point is they are holding this new functionality hostage and willing to hand over my experience for information of behavioral data for their futures markets. My argument is we signed on to the digital as a new era of empowerment and democratization of knowledge. Thats what i want. Thats we all deserve. Twentyfirst century citizen with an advanced Democratic Society we are hitting some speed bumps right now also another conversation i believe our democracies are holding. Weve been in tough situations before and we have come through them. I believe very deeply in the sanctity of democracy. And i believe as citizens of a Democratic Society, we should not be held hostage to this bargain made on the part of private firms who do not believe in the legitimacy of the vote who are self authorized in the claiming of the experience and what they do with the data from our experience we have no knowledge what they are doing we have no influence and it is expressly done in the way that bypasses and usurps our decisio decision. Companies have two responses. One is very classic and the other is more marketbased. The first one, the security argument when we put computers in the users home giving everybody windows pc they forgot to install the updates and when the network was taking the infection it is better for us to centralize management and keep the bad actors out we can do this more effectively. If you run your own mail server its more likely you will not be a good it person so gmail just do it for you and we will prevent the state actors which they are able to do does that seem compelling to you as a National Security argument . This is a rhetorical question right . And then google keeps the bad actors out . I think those arguments were made at a time when first of all surveillance capitalism was not yet prevalent. When there were more Security Issues as far as viruses and so forth. But those issues have gone down to be centralized. That yes in centralizing the security model, as we have the close the window open the door so we are more protected from viruses and even then is not protected but the fact of the matter is that to centralize the harm, the corruption of the systems that are centralize there is now corruption in the model that affects every single one of us is not just the corruption against Shoshana Zuboff but on the global system that can shift elections and transformed the sanctity of democratic elections. I think we are well past the argument for centralization and i also think from a technical point of view we have many more tools for treating security in a decentralized atmosphere then we had 20 years ago at the beginning of the story. So that is one thing. Host i tend to agree with you although im often called to fix my families computers. That you are not a corporation. You are part of the family. When you have aligned interest with your parents to make sure their home functions the way they wanted to. That the market question is that they could ask me for help that when i am aware of is many people are much worse at managing their Computing Devices and as they get smart and collect more data which i do think its important, you have to make some choices. Most people are blissfully unaware which is a problem that we point to. And the market question is they are choosing this they are choosing to buy an iphone where apple pushes the security update it will change overnight if you set the settings in the app store now thirdparty vendors have authorized apple to change on the phone. That tradeoff that the people and consumers are choosing to make. Thats the companys argument were buying the smart thermostat. You by that and you make a choice to let us into your home i can tell you dont think thats compelling but why are consumers overwhelmingly . Where does that interest come from if it works against us . Again that is a hugely important question for all kinds of reasons including the Market Opportunities and those failures represented. So what we have is a very contradictory situation. Surveillance capitalism has flourished in the past 20 years including the representation now of the product that has the words smart in front of it for surveillance capitalism. It with alexa and everything in between. It is remarkable that one of the biggest tv vendors in the country and the most controversial and i have the video tv when it is not performing optimally which is a lot. So the answer is very clear no shading or hiding im just trying to cover the cost with all this recommendation work that i do is very make money. And then is there with one transaction if its a dumb tv you have to pay a higher price. So it becomes this apparatus of this ongoing relationship. But its not necessarily a relationship. That people seem to be choosing theres not a huge market. The key word is seem. So what we understood with video because you brought that up and the legal case made against video and not perfect example of design for ignorance. One reason that people are choosing is because they have no idea what is going on not because were stupid but because these operations are designed for us to know even what is going on let alone their purpose of what they are doing. You are attack expert you are at top of the world and you are asking the manufacturers why are you doing this . We simply dont know not because we are stupid but it has been designed for us. Is designed to be outside of our awareness and indecipherable and designed to be hidden so i asked the question how did they get away with it and the answer with 16 reasons there is no one simple reason but if we zoom out from that i look at the many significant pieces of survey Research Done the past ten years with fifties significant pieces of research. And they ask people basically how do you feel about the companys taking your data . Two of the surveys are a little inconclusive only because what the researchers write is they say to get conclusive results because the participants did not even know they were taking data. So most of these surveys the outcome goes like this. People say when people learn what the companies are doing, they disagree want to participate Something Like 70 percent or 80 percent, even more respondents dont want any part as legitimate and justified and they go to these numbers carefully in the book. The issue is now we get to a place where our choices are very limited so we seem to be choosing it or the alternatives are vanishing. So ive gone through this in my own home i have a flat screen tv in my home from 2010 maybe . Is not smart or internetenable internetenabled. All functionality we need thank you very much. If i want to replace that, it will be very difficult to get a tv that is not internetenabled where everything can go out there just like the nest thermostat and to the third parties that may be impossible for me to know about. Or the famous kayla doll that i write about my folks discovered this stall that our children were talking to was picking of the dialogue of our children they are called dialogue chunks of the business being sent to a company that sends dialogue chunks on to other organizations and companies and institutions including the cia and nsa developing Voice Recognition software. This is coming from your child nursery all the way to the cia Voice Recognition software through the are the supply chain. So we have is a situation we are increasingly getting shunted into purchased products in a way that cannot technically be called the choice is not an informed choice and its the purchase that is happening because those alternatives are foreclosed. And in the scholarly world the difference between that people combine the stuff we use Google Search and they go to facebook with their behavior and their attitude on the other hand it is not legitimate. The more i know the less i approve participate. So there is a gap between attitudes and behavior. And in the literature its called a privacy paradox. But its not a paradox. It is a market failure. It is an aggressive mismatch between supply and demand as expressed by the attitudes is i want to trust the companies i do business with and if they were made data is simply to improve service to me, i want to know exactly what it wants to take, how it takes it, give my permission for every single step in the chain, 100 percent transparency of how the data will be used to improve the service to me. If thats the case and go back to the aware phone model 100 percent how it improves service to me. That is where the demand is that what about the supply . Thats on a completely different trajectory where they are responding to the demands of business customers who pay to play in the behavioral futures market. The demand we the people is erased from the equation. The supply is addressed to another realm or another marketplace. I would call it a twosided market i know other economist of called the data that i beg to differ. Because what is happening is not a market precisely because there is no Value Exchange or transaction or supply and demand relationship and no customer relationship. What is happening on this site is a group of users increasingly a global group with free raw material as a true marketplace the alleged second side it is still a onesided market. Its interesting because actually i just want to talk about the companys big players its very interesting. So if you ask apple they say we do self privacy there is literally overhang. You can make a lot of arguments but this is what they saw their the market. This is what we sell. Does that work against your conception . Not at all. This gets us to a key issue the importance enough so we ask what are the solutions we havent asked that yet. I will wait for you to ask that. [laughter] so one side has to do with the Democratic Institutions and what pieces of the solution have to come from the democratic institution. We want to talk about Competitive Solutions that come from the marketplace. Now if you buy my argument we have a tremendous mismatch between demand and supply, i have just identified a competitive opportunity. Somebody once you step into that gap between supply and demand to have the opportunity on earth to have every person is their customer. Look at the state on dash surveys that nobody freely wants to buy into surveillance capitalism. So if you can truly offer the institutionalized, fully transparent, deeply consistent, profoundly trustworthy alternative you will be coming into a market void where there has been a profound market failure. In not fully you have an opportunity for a historical leap forward to restore the trajectory of the Digital Future to the past we were want someone with the aware home when we thought this was all about us rather than about them. So you bring up apple. The question in my mind is can tim cook. Shout out to tim cook. Tim cook and apple can they truly step into the space . We know he spoke in brussels back in october and to make some very strong remarks about apples commitment to enter precisely the space i have described. Many Adverse Reactions to his strong remarks were cynical because is not difficult to point out inconsistent on inconsistencies in the apple playbook. You pointed out some of them. There is still Google Search. Apple stores user data into new servers. There is a whole litany of inconsistencies one can point to. Perhaps no one is a dealbreaker but if you put them all together and you see apple still has work to do with it will fulfill the true criteria institutionally that with the true economic leap forward to really move the dial of economic history and that evolution of capitalism. That this is apples opportunity to lose with the big tech firms this is their opportunity to lose. And i think where apple to rollup its leaves to become as scrupulous as General Motors once was under the leadership of sloan, to design the symptoms but became the modern mass consumption corporation , a model that spread all over the world and was responsible for much of the Wealth Creation the 20th century in combination with democracy. It lifted many boats not just the elite. This is a massive Market Opportunity if apple doesnt throw up its leaves and it agai again, somebody will. Maybe it wont be a Big Corporation or a coalition. Or other firms of commercial configuration, but this market failure banks for a competitive solution. There is a arrival called. Go signing a deal with apple maps. They are listening to the criticism. And for me i want to believe there is still that integrity and bond with society and democracy because it in the and our business organizations ultimately have to be interdependent thats it makes that only market capitalism but a democracy such a successful model and a vision of the democratic and economically successful kind of future. I think these things are possible. We accomplish them before, we can accomplish them again. It is fairly clear that google and facebook with the surveillance capitalism they essentially have change themselves. The one company you bring up in the book that made the transition is microsoft. Has it happened . And amazon in a certain way. Host i think amazon has always been in the business. Yes but i think that for quite a while there was a very strict discipline where the data was not entirely used to improve services. So those recommendation engines that the Customer Service systems and all the things that they have that made amazon so incredibly successful. I dont want to introduce a lot of jargon i call that the behavioral to be reinvested into the service area. And more recently that is in a new direction where the data are used in the secondary market place which we see now with alexis of course as part of that effort. Host i was on the microsoft campus this week. That is is in the Surveillance Data business and says i believe privacy is a fundamental human right and should be able to opt out and heard this criticism and you can turn it off and microsofts businesses to help other businesses and people make more money. They dont think of themselves as an aggregator to say this to me we are a Platform Company people build that on top of microsoft he is very clear and says the same thing makes you think they dont have the same opportunity . I think perhaps they could have the same opportunity but a lot of things would have to change. You go into the data on microsoft assistant and how that is in the book and a very specific plans that he regrets microsoft missed out on the targeted ad business and they were not able to make their search product as successful as Google Search because they didnt gather behavioral data through the targeted advertising and to play catchup in not so there are many elements and i document my arguments that show including the purchase of linkedin that was explicitly discussed to bring in a whole new dimension of behavioral data to vastly increase the Knowledge Graph so it could do much more that behavioral data. I have documented the ways microsoft has moved in this direction and has been rewarded for the moves and has been praised and adored. But by his own stock market the analyst is it too late for microsoft to say we have seen the light with this market failure and we want to get on the right side of history and the right side of humanity and the right side of democracy . This is truly how we want to do our business . I dont think its too late. For google and facebook i specifically talk about microsoft seeing the whole train going by and then to decide we need to be on the train also because theres just too much revenue were not participating in so google and facebook is so fundamental to the dna its hard to imagine and microsoft is selling software the primary markets to the clients that are buying software and all those things. So it still house those openings but it would require a new level of commitment and discipline and a very different picture how bed we achieved the margins undocumented in the book. Its hard to talk about solutions the way you saw the market failure that doesnt seem likely. Or the state can solve it. So we can regulate capitalism so i think we see that in europe with a gdpr there has already been some changes in the New York Times from when that was rolled out the times turned out that model so maybe you dont need it is much. Market opportunity. And that correlation that things happen. There is a law in california coming out i spoke to the Representative Congress he told me that if we dont have a data privacy law and the First Six Months we need to rethink committee leadership. There is a Community Story the cellular carrier cellular location in the they are saying we need to hold hearings. So there is movement in the positive direction. Is that enough quick. It is fantastic. It is critical. We are talking about the structure, historical transformations, the digital surveillance capitalism not just a simple Business Model that the accumulation spreading through the economy, not simply a question to regulate facebook or google, and i think the first step when we talk about this big Historical Movement it is not like we can just have a fivepoint action plan and fix it up but this is something we need a fundamental shift in Public Opinion where we already know peoples attitudes and we need to be able to translate that into demand and resistance and outrage to get the attention of our elected officials that has begun to happen and what you are describing as the first inkling of that. The danger here as reverting to the antitrust paradigms very clearly let me say these are terribly important privacy law is essential antitrust law is essential however is not difficult to imagine fully implementing all of those and still not interrupting i can use the example we break up facebook on antitrust grounds so the message to the lawmakers is we need a new paradigm legislation will interrupt and outlaw surveillance capitalism every vaccine develops at the close understanding so we need to thoroughly understand the mechanisms and imperatives so to design the regulatory institutions and our laws to make it ill legal to take my private Human Experience without my knowledge and my permission to convert that into others financial gain and those about my future behavior without my knowledge let alone permission the behavioral future markets themselves are illegitimate and maybe outlaw altogether imagine the New York Stock Exchange now they are trading in the futures of Human Behavior is at the world that we want and what are the implications of that. So we were at the beginning of an incredibly important process we need Market Solutions and solutions from democracy we need both is not either or unless we have those we will not have a human future that we all want to spend that is as good a place to wrap up thank you so much an excellent book. Thank you