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Welcome to the Splinternet

Posted on by Steve Sammartino

A few years from now, every country will have a very different, national internet.

Yes, we’ll still have access to many global platforms, but very soon using the web in different parts of the world will be more like visiting a foreign country was in the 1970’s. A nuanced and culturally different experience. In the long arc of history, national and regional policies move like tides, across generations. The tide has turned against a one size fits all Techtopia. But first, let’s remind ourselves how we got to now.

Global Utopia?

In the early 1990’s it seemed as though our geopolitical future was determined. Capitalism and democratic freedoms had won. Assisted by the fall of the Berlin Wall, the end of communism in Eastern Europe and a burgeoning new communications technology called the internet, borders and knowledge opened up. We quickly globalised through mutually beneficial trade and cultural understanding. But this era of unfettered globalisation is coming to an abrupt end.

Economies the world over are starting to re-nationalise, put up technological boundaries, and remember that at a certain level of income, what a country believes in is more important than pure economics.

The financial benefits of the web are very unevenly distributed. A simple example is this: Revenue per employee of the Ford Motor company is $682,000 while Facebook has revenue of $2.3 million per employee – and that’s even before relative profitability is taken into account. In the western world, the many benefits of globalisation have gone to emerging technocrats and the shareholder class, and the middle class and Governments are starting to notice. Regulation will take hold in every country limiting the power of big tech and openness of the web. I’m not saying this is good or bad, but it is happening.

Bonus: this short song is a must listen to what the internet has become (You won’t regret it)

The Splinternet

It was in many parts the web was a new economic paradigm without a policy.

Up until 2010 Google had a 30 per cent market share of search in China before they abruptly left that market amid a cloud of hacking, censorship and PRC policy conflicts. We can see national value systems emerging via internet policy, resulting in a Splinternet.

China: has already removed all US tech firms from its shores (Including Linkedin just today), it sees the internet as a tool of Sovereignty and Surveillance. The policy has been one of allowing innovations in the short term to learn from and copy, be it US tech firms, or blockchain-based technologies until such time that they can launch sovereign versions and remove the intruders. While it seems draconian to us to hear about the internet is being used by the PRC to maintain total control, the people (of mainland China at least) seem happy to sacrifice liberty, for continued prosperity and improved living standards.

Europe: the internet has become a battle around Data and Privacy. In the European Union the internet is increasingly about protecting people and local firms from the evils of the internet, rather than trying to build out dominant firms in the space.

USA: is trying to tame the beast that is Big Tech, A set of corporate institutions more powerful than nation states. A beast which is dividing their society socially, economically and politically. As of today the top seven technology firms in the US have a collective market capitalisation of $US9.9 trillion. This has increased more than 30 per cent in a single year. The internet on its shores is set to be heavily regulated like manufacturing and traditional media and eventually broken into many more pieces as inevitable antitrust actions take hold.

Australia: recent events have triggered the end of the www, or the wild-wild-west, and now we are taking steps to create the social and economic boundaries society is demanding. This is an especially easy move to make given we hardly benefit from big tech’s dominance. The accumulation of Government intervention cannot go unnoticed, regardless of their actual effectiveness. Policies including the News Media Bargaining Code, the G7 global tax agreement, the High Court ruling that firms are responsible for comments on their managed pages and recent commentary from the Morrison Government about making social media giants needing to be accountable for content on their platforms are all part of a huge shift.

Something is wrong with the internet!

“Something is wrong with the internet”… was a statement made widely around the world early last week as the Entire Facebook Eco-System was down for around 7 hours.

It would be easy to think these noobs were wrong describing the Facebook outage as being a problem with the ‘internet’ – but oh, how right they were. In fact, 2.8 billion people were locked out which is more than 60% of the world internet population. The fact that it has become many peoples only tool of communication on the web is an absolute travesty. In a grand irony, Facebook staff got locked out of their own HQ because they used Facebook apps as their building entry tool. They even had to get tradespeople in with angle grinders to break locks and get into office doors. Many small businesses couldn’t connect with their customers.

All this is a reminder that in a civilised society, we need to civilise our technology.

Whether it is splitting up companies that have too much power, stopping the spread of misinformation, adding safety features, making companies responsible for products they put in market and regulating so that economic benefits are shared more widely across society. Just imagine if we didn’t have road rules, or any safety features in cars or need a drivers licence. it’s unthinkable.

Pure capitalism is as dangerous as communism is. What we need is a balance of rules and regulations so that we can participate in the economy in a civilised manner – and be the beneficiaries of technology delivered by thoughtful legislators and profit seeking, yet compliant corporations. Because as far as I can tell, not company in the history of capitalism has ever self regulated out of the goodness of their hearts.

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Keep Thinking,

Steve.

Programmable Currency is coming

Posted on by Steve Sammartino

China’s 2021 crackdown on crypto currencies has continued unabated. They’ve now banned all types of Crypto transactions. But don’t be mistaken, China wants nothing more than to move to a crypto economy. The Digital Yuan – their own Crypto.

Currency Creates Control

It is said that you need control the three M’s to capture and control a society. The Media, the Military and the Money. The loss of control of any of these elements can lead to destabilisation of a Government. China is clearly intent on having a firm grip on all three. I’m with China on this one. Any government in the world that moves to a non-sovereign currency (Like El Salvador has making Bitcoin its national currency), will lose control of its economy. That’s not to say we shouldn’t have crypto – just Government issued Crypto. And the reason is simple – crypto currency technology, has many features fiat currency does not. While we may not like China’s policies and record when it comes to human rights – they are out performing other global powers when it comes to economic and geo-political strategy.

The Birth of Programmable Currency

One of the main features of blockchain based crypto currencies is their potential to be digital, yet anonymous. They key word here is potential, because the direct opposite can also be true. The Digital Yuan features what is known as ‘Controllable Anonymity’ given that it will require citizens to register and download the central bank app on their smartphone. But it doesn’t end there. The currency will literally be programmable. The China Government will be able to not only ‘air drop‘ money into people’s accounts, but they will have the ability to easily freeze and close accounts – something which can’t be done with, let’s call them ‘democratic’ crypto currencies.

This is where the move to the Digital Yuan gets interesting. They won’t just be able to control their currency distribution digitally, they’ll also be able to define where and when it can be spent. It will enable China to have a level of control over their monetary system not seen in the history of currency. Transfer payments will take on an entirely new meaning. When economic stimulus is required, they’ll be able to set expiration dates on money transferred to ensure it is injected into the economy and not saved. If it is not spent by a certain date it will literally evaporate from people’s digital wallets. They’ll be able to dictate where certain amounts money can be spent. Grants for students or unemployment may only be able to be spent on groceries, rent and transport for example. If a wallet is presented for payment to an unauthorised type of vendor, the transaction will be declined. They’ll be able to shape spending and investment in a way the global economy has never seen. It will give them an inordinate economic advantage on a global scale. And while it does sound slightly dystopian, it is clearly aligned to all their other economic policies we’ve seen recently as they tighten their grip on their ever-wealthier populace.

Non-Fungible Currency

While it’s not my hope that Australia moves over to a system like this in totality – a more democratic version of programmable currency is an incredibly powerful idea. Countries like Australia and the USA could create incredible productivity via programmable currencies.

Let’s take Job keeper. As published via the independent Parliamentary Budget Office’s analysis –the Morrison government paid $12.5 billion of JobKeeper in the scheme’s first 13 weeks to firms that didn’t experience the turnover declines they forecast in order to qualify for it. Extrapolated to the full 26 weeks of JobKeeper 1.0, that amounts to $25 billion of taxpayers’ money misspent. Around $9 billion was paid to firms whose turnover not only failed to decline as forecast, but actually increased.

This overspend could have been avoided if we could code into the money that it could only be used in wages and salary. We could also remove amounts from their accounts post-hoc once it was clear the firm didn’t face a decline. We could also make sure jobseeker benefits have restrictions on where funds can be spent, which protect the sanctity of the system. We could direct future stimulus payments into preferred economic sectors.

In the future, we’ll all have crypto wallets with two balances – money we can spend as we choose, and restricted funds. The eventual upside is that we’ll enter a pre-emptive tax code – a code where money is directed before it is collected. We won’t re-allocate money after it’s earned, but pre-determine where it can go. This will be something corporations will be able to do with their employees and spending budgets, no purchase will order would be required when money can be programmed on where it can be spent in the first instance. Even parents will be able to use this with their children – restricted handouts if you will.

This fundamentally changes what currencies can do and are. It’s clear that this is a big shift – and it won’t suit everyone, but it is my belief that most economies around the globe will move to Sovereign Cryptos (AU-c / US-c) and remove cash entirely from the economy within the 2020’s.

When this happens, we can also expect traditional cryptos to take the place of cash – and be the bastion of the hidden economy and dark money, and tradies doing crypto cash jobs – humans always find a way to hack any system!

Having money which isn’t fungible really marries up with the shift to increased control and autocracy the world over. What we need to ensure is that this shift doesn’t leak into the free market and remains a tool for more efficient Government resource allocation.

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Keep Thinking,

Steve.

It’s time to fix social media. This is how.

Posted on by Steve Sammartino

This week in Melbourne, we faced violent protests from a noisy minority ostensibly fighting against mandatory vaccinations for the construction industry. It has been asserted that many of the protesters were anti-vax interlopers and from other extremist groups.

Like a lot of things these days, it’s increasingly hard to figure out what’s true. This is a real problem, and it’s pulling apart the fabric of society. At a time when the world’s knowledge has finally become mostly available for free, we are at risk of regressing. Entering a technological Dark Ages, if you will.

People who oppose vaccines, without legitimate medical reasons, remind me of Seinfeld’s bit on helmets. Some people’s brains are operating so poorly that they refused to wear helmets to protect themselves. While fringe views and conspiracy theorists have always existed, it’s ironic they can now spread their messages on social media virally to the unprotected and at scale.

The Anti-vax movement is the latest in a long list of problems social media is contributing to. Fixing problems now clearly evident with global social media products is much easier than Social Media companies make it out to be. The playbook from Facebook and Twitter, has been simple but effective: confuse the possible with the profitable.

Social media’s product is to sell attention. On the social web, enragement equals engagement. The net result is that mistruths, violent content, gamified financial scams, crime – you name it – all do a better job of reaching an audience than rational, civilised content. I used to love Twitter, but its landscape is now just troll versus troll with opposing views. Mark Zuckerberg and Jack Dorsey know this and still, they choose to ensure their secret algorithms leverage whatever maximises our attention.

If lies about the climate emergency were not spread on social media, how further advanced might our renewables sector be?

What type of risk does the continued anti-vax movement fuelled on social media pose to our post-COVID economy?

More importantly, how do governments around the world respond to ill-informed pockets of our populace on issues that shape economic and social policy? The threat of misinformation to our future stability and prosperity is real, with far-reaching consequences for us all.

How to fix social media

Three simple steps:

1. Know Your Customer:  Social media platforms should mandate users to register with 100 points of ID as a criteria for participation. Immediately, this imposes on users a new level of accountability and traceability. Doing this will go a long way towards removing bots pretending to be people.

Bots are used to gamify social media, distort amplification of issues and manipulate trending topics and mistruths. These are the same bots for which advertisers are currently over-charged to sell their products.

It’s astounding to think that we need to provide our identity to drive a car, buy securities, open a bank account, obtain a credit card, board a plane, operate machinery, purchase a mobile phone, use a SIM card in another country, even to ride on a train – and yet social media doesn’t face the same scrutiny. Quite lopsided, given social media is the most powerful communications tool ever invented.

It’s time we added a ‘Know Your Customer’ element to the digital world. No bots, just real people.

2. Regulate algorithms: It’s time we exposed the ingredients in the algorithms that shape our digital existence. We need this in the same way we have transparency in the ingredients of packaged food.

We need Algorithmic Nutrition Panels that clearly outline what we are seeing and why, plus the ability to turn them off in our feeds. It may well be that certain ingredients in the algorithms need to be outlawed altogether. It’s hard to know which algorithms might be causing the problems when they are still regarded as proprietary secrets.

Nearly a century ago, the packaged foods industry used this playbook too, when secret ingredients included cocaine (in tooth drops), heroin (in cough medicine) and lithium (in 7Up). In real terms, algorithms are editorial decisions. What we let social media feed our minds is surely just as important as what we put in our bodies.

3. Legislate responsibility for platform content: Social media is media. They cannot be compared to telecommunication companies, for instance, who are not responsible for the content of one-to-one conversations on their phone lines.

Social media content has a distribution element that clearly propels it to the broadcast media category. They should be responsible for everything that is published on their platforms. It’s no wonder that traditional media categories can’t compete. If it means that all live video feeds on Facebook should be vetted by humans to avoid the issue of inadvertently live-streaming terrorism, then so be it.

Remember, if identities are not obfuscated on social media platforms, we can implement a rational policy that allows fair use and a system to protect both users and platform providers if abuse does occur. Of course, once we know who everyone is, behaviour on the platforms will be, by default, more considered. Just compare LinkedIn to Twitter and the differences are stark.

So, there you have it – three simple ways to remedy the ills of social media.  They indeed create a cost for social media businesses, but it’s a cost of doing business and all very possible.

At present, social media is incredibly anti-social and we are still in its nascent phase. If we want to avoid the calamities we’ve seen in other countries facilitated via social media – then we should act now.

There is little doubt about how it has been and can be a tool for emancipation, but we should never forget that living in a civilised world is only be possible in a cohesive society.

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Keep Thinking,

Steve.

Meta-Benefits & NFT’s

Posted on by Steve Sammartino

The price of innovating early can be a real bargain, or it can be a total stooge. Like all things, value depends more on long term utility than hype. If you buy something hoping someone will pay more later, what you’ve bought is hype, even if you succeed.

If you’ve been watching the NFT space closely, you’ll have noticed people taking death defying leaps into the financial unknown. It has artists making big coin (crypto of course) in a burgeoning hot market and it has corporations buying from massive cases of FOMO.

To bring you up to speed, In just the past month, total sales of NFTs topped US$1 billion. It seems that 2021 will be the year of NFTs Most notably, Visa purchased a Crypto Punk for approx. US$150,000 (or 49.5 ether) for their collection. The picture on this blog is Crypto Punk #7804 which sold for a cool $7.6m USD. While a Coca-Cola NFT auction fetched more than US$575,000 for digital collectibles. And a teenager from London collected $350,000 for his Weird Whales collection. And if you think this whole thing is weird, the largest art museum (The State Hermitage) in the world is about to Auction NFTs for actual Da Vincis and Monets. We are giving birth to the metaverse.

I recently auctioned my first NFT. It was a digital version of my tech TV show – The Rebound on Channel 9. But rather than just sell a digital piece of art, or a gif – I attached a smart contract to it, which gives the winning bidder the right to appear in 8 episodes of the show next season to be mentored, which will reach around 800,000 people nationally.

The winning bidder paid just under 1-Ether for the crypto episode – around $4,000 AUD. This was a total bargain.

The cost of paid TV space with this reach would be well over $100,000 – they got it for 4% of its market value. In their case, the price of innovating was very low indeed. And this is not some imagined value in the future where a greater fool pays more – it’s worth that now, today.

Some of the prices people have paid for NFTs I think is foolish. Especially given the value is largely in their mind. Likewise, we mustn’t forget that this is often the case with premium products. How much better is a top of the range Mercedes versus Toyota? It’s also worth remembering that many of the people purchasing NFTs for high prices are doing so with Crypto they’ve help for a long time which now has a high market value, but it wasn’t really money they had to sweat, to get! Easy come, easy go. The best way for normal people like you and me to participate, is with our time and small amounts of money. We mustn’t write it off as a bubble, but we should also tread carefully.

Where this will go, is into a world where everything physical has – Meta Benefits – benefits attached to crypto tokens which prove ownership. Just like my TV show NFT – the owner has the proven benefit of appearing on the show. Anyone selling anything physical, should be thinking about how to tokenise what they sell, and how to enter the metaverse.

I had an Interesting chat with Steve Vallas, the CEO of Blockchain Australia on the future of Crypto and BlockChain this podcast. A great way to get up to speed is at the upcoming NFT Fest – it’s free to register and will really open your mind to what’s coming.

Keep thinking,

Steve.

NFT to TV Star

Posted on by Steve Sammartino

So here it is: my latest world first! As part of The Rebound TV show, we are selling the final episode of Series Two as an NFT. This is the first ever Australian TV show to be sold as an NFT.

Here’s the kicker: The winning bidder of this NFT will also become part of the next series of The Rebound. We call it NFT to TV Star! We will mentor them in their business or career, as part of the Accelerator programme on Series Three and broadcast nationally in Australia. This NFT will be someone’s ticket to TV stardom and a new financial trajectory.

You can buy this NFT on Rarible.com – check out the NFT here. Heck, why not bid on it? At the time of writing, it’s a mere 10% of 1 Ether (around $323 USD). I’d love to have one of my readers win it and come on the show – that’d be rad.

As you may know, NFTs are tokens of digital assets. The cool part is that you can attach other entitlements to these tokens – all of which are verifiable on the Ethereum blockchain. In this case, the buyer wins the token to our Crypto episode, as well as the right to actually appear on the show. But it doesn’t end there. The person who buys it can sell the NFT to someone else, or even a company looking to promote their business (a TV show would be a pretty good place to do that). So the NFT could also become a traded asset that increases in value before a smart contract is executed against it.

Bonus: You can buy this experimental NFT gif here. It also comes with an hour long mentoring session from me or Tommy. I have already sold four of these this week. Only one is left! I have listed it at a very reasonable price of 0.01 Ether (around $30, the minimum listing price). It’s a good way to dip your toe in the water to experiment with the tech and learn – which is what I did. Get on it and chat NFT / future stuff with me!

This is a nice example of how we can better use digital assets by attaching real physical things and future contracts to them. The world is getting increasingly meta. This means the most important asset isn’t the technology itself, but how we apply our imagination to it.

Keep Thinking,

Steve.

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Competence, Confidence & your Future

Posted on by Steve Sammartino

As a social species we humans are naturally attracted to certain behaviours: Competence and Confidence are two that really matter. While they may seem like separate entities, they interact in interesting ways.

Bonus: Here’s a must watch funny story of me being too confident with my school principal and him swiftly reminding me I lacked a certain competence.

They Feed Each Other: When we are competent at something, our confidence grows as a result. When we meet a confident person, it’s not their confidence we are actually attracted to, rather our internal belief that it must be a reflection of competence. Our mind believes they must have valuable skills. The reverse is also true – if we lack confidence people believe will it is because we lack competence – regardless of ability.

This interaction forms a huge part of our economic success. People buy us, before they buy anything we happen to be selling. By reminding ourselves of this feedback loop, we can hack our own behaviour to forge ahead in our work, life, and even our relationships.

Invest in Yourself: When you invest time in developing competence (maybe it’s learning about an emerging technology, or a career or business skill) confidence increases. Even before the skill is acquired, the effort itself, will build self esteem. You start to believe in yourself. You believe you can do and become more, you can jump over those difficult competence hurdles. This is especially important if you are not an overtly confident person, or let’s say, humble in your abilities.

Reality Check: While confidence matters a great deal – if there is no competence to back it up, it will eventually all come crashing down. In the long run, the person will always get found out if they are a fraud. We should always aim to be good at what we do, be competent, yet we must never forget that unless we have enough confidence, we are unlikely to ever get that chance to prove ourselves.

Bonus No: 2: Tommy and I do some ‘Acting’ in The Rebound – which displays how a confident designer can get the price they deserve!

Speaking of Competence: Be sure to tune in tomorrow at 12.30pm on Channel 9 across Australia for The Rebound. Tomorrow is all about the Future of Work – a topic which affects us all. You can catch up on all the episodes here.

Keep thinking,

Steve.

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The Rebound – Season 2

Posted on by Steve Sammartino

Did you miss me? I’ve been busy working on my TV show The Rebound which is now in it’s second season. You can see it on Channel 9 nationally every Saturday at 12.30pm. It’s filled with Sammatron philosophy and soundbites of goodness. We are 4 episodes in – which you can catch up on here. We have another 4 to go. Each episode has a theme and this season we are covering Skills, Design, Story Telling, Pricing, Culture, Growth, Future of Work & Crypto

I thought I’d serve up some of my fav’ bits so far. Stuff you can take to the board room, the bank and get your brain firing.

Skills: The internet is like a giant supermarket – it has all the intellectual nutrition anyone could ever hope for – but it is hidden among junk food for the brain. Here, Tommy and I break this idea down for you. Worth explaining to your kids. Another must see story is the guy who outsourced their job. It might be the greatest career hack of all time!

Design: The most important design principal of all: Design isn’t just how something looks – It’s about flow, how a a system works – or even how to flow through people’s minds. Here Tommy shows us the greatest packaging of all time and uncovers the art of biomimicry. And here I play a game of design based Fail or Scale with Tommy.

Story Telling: Perception is always more profitable than reality. Often we think we are buying products features, when what we are really buying is a story. Here’s the worlds only $500 billion story. And here I deliver a short DM on a concept I call Industrial Tourism.

Pricing: Pricing is a game where we need to experiment. We should be more fluid than we usually are. People don’t expect prices to remain the same – so always remember this when doing business. The Fast Track Hacks segment in this episode is gold. Here, I demonstrate why value is in the mind of the customer – and not the price itself.

Tomorrow’s episode is all about Culture – and it is a cracker. Be sure to tune in and let me know what you think.

Hope you staying safe.

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Keep Thinking,

Steve.