What the Internet of Things can Learn from “The Order 1886”

Great (Sounding, Looking) Potential

The Order 1886 has great quality graphics, but is a poor quality game. Just because the technology involved is cutting edge doesn’t mean the final product is good. The internet of things relies on some cutting edge technology and novel ideas, but that doesn’t mean the final product is always favorable.

I’ve been hearing about the “Internet of Things” for several years now. Middle-aged entrepreneurs are just sure that this “the next big thing,” except it’s going to be bigger than the car or the light bulb. From what I’ve seen, IoT is a glossy, shiny, pretty gimmick that hasn’t shown it’s poised to really solve problems that consumers feel they have. So far, we don’t think a fridge that buys eggs for us is really what’s missing in our lives.

Having sophisticated technology isn’t the same as having a great (or even marketable) tech product. In the same way, having glossy graphics isn’t the same as having a good (or even marketable) game. Both IoT and Order 1886 are impressive at a glance, but fail to live up to expectations as one spends more time with them.

Burger King Sets Itself Up For Trolling

The broad IoT idea continues to reveal vulnerabilities and half-thought-out applications. A few months ago, Burger King aired an ad in which the actor in the commercial asked the viewer’s smart phones to read the first paragraph of the Wikipedia page about Burger King’s flagship product, The Whopper. The completely predictable result was that people started vandalizing the Wikipedia page in question, leading the ad to tell people that The Whopper contained humans and cyanide.

There’s a lot I could go into about this example, especially about troll behavior and the weaknesses of IoT’s reliance on unsecure nodes. I want to highlight that the problem wasn’t about hacking into Burger King or Android systems. There are some concerns with IoT and that sort of hacking, but there’s another problem: Entrepreneurs rely on the web without knowing what 4Chan is or having have never been verbally abused by a stranger for the length of an entire League of Legends match. That is a mistake.

This example also illustrates why IoT hasn’t gotten traction: It’s still a gimmick that breaks often. Even when it works at its best, IoT is a fun and surprising answer to a question no one asked. The best case for Burger King’s commercial is that they surprise a few consumers, but also stir fears about privacy and security in doing so. The success of IoT still hangs on the uncomfortable reality of diminishing personal privacy, and many consumers haven’t completely reconciled leaving the past with entering the future.

The Order 1886 Fails as a Game, IoT Still Fails as a Tech Product

One of the reasons people were so angry about The Order 1886 is that the trailers looked so good. People bought into the promise and the hype, and then it failed to deliver in meaningful ways. Similarly, the more glossy the presentations about IoT get, the more consumers will feel the gap when they don’t experience a meaningful impact as a result of using it.

It’s the applications that go on top of the tech that really matter. Platforms and apps that balance consumer’s emotions about privacy and security will be the only thing that can really bring about the kind of pervasive, omnipresent IoT about which I keep hearing (excited and vague) presentations.

Things that look really good but don’t do anything are called art. Things that do something useful are called products. Usefulness is not the sole factor in a product’s quality or its marketability, but it is important- especially if it wants to be more than a fad or gimmick that ends up with a discount sticker in the bargain bin.

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ISPs Tell Two Lies: “This is Fair” and “This Will Work”

Intro: The Parable of the Watermelon Stand

Once upon a time, two folks (Alphonzet and Balantanoid) decided to sell watermelons at a roadside stand. The two-step business model was: 1) buy watermelons for $1 apiece from a farm, then 2) transport them in their pickup truck to the roadside stand, where they sold the watermelons at a retail price of $1 apiece. After some time, accountant Balantanoid informed business partner Alphonzet that, due to the price of gasoline and other incidental business costs, they were actually losing money. Alphonzet reviewed the numbers and pondered, and then ventured a solution:

“Do you think we need a bigger truck?”

Businesses looking to buy consumer information from ISPs are like the characters in this story considering using a bigger truck. More data isn’t what businesses need, and there is danger is believing otherwise. Furthermore, ISPs unjustly shirk responsibility that ought to come with the entitlement to the data they intend to sell.

I. Background.  Internet Service Providers Aren’t Satisfied With a de facto Monopoly

Internet service providers have no competitors and provide a borderline necessity. They can charge anything (and do) and provide a low quality product and service (as they do), and customers will still pay them (and they do). This isn’t enough for them. The telecommunications industry has successfully lobbied congress into repealing an FCC order that previously prevented the sale of tracked, identifiable consumer data to third parties.

Of course, ISPs are the only ones who can risk fighting their customers. Service providers operating on the internet can’t antagonize their customers because they are subject to fundamental concepts of free market capitalism: If they anger their customers, their customers will go elsewhere. ISPs don’t have “customers” in the traditional sense. They have “victims” or “hostages”- so it makes sense that ISPs wouldn’t worry about treating them like customers.

II. “This Will Work.” ISP’s Already Lie to Consumers and Government- Now They Get to Lie to Businesses

I don’t know how many lies the telecommunications industry had to tell congress to get the FCC’s rule repealed. Probably not many- after some generous donations, congress rarely asks very many questions, or cares about answers. But the lie that ISPs are relying on now is for 3rd party companies to believe that (in the context of the aforementioned parable) a bigger truck will turn their watermelon business profitable. There are two likely outcomes of this business arrangement: either advertising will get better, more efficient, more streamlined, more effective, and benefit both advertiser and consumer, OR advertising will become more obnoxious, more noisy, less useful, less relevant, more intrusive, and worse for consumers and advertisers.

In his NYT Op-Ed on this legislation, former FCC Chairman Tom Wheeler gives the example of ISPs selling data to car dealerships about which customers are visiting car websites, thus allowing car dealers to target more likely customers. One interpretation is that this will help car dealers only target relevant audiences, and customers will get better opportunities and information as customer-business connectivity is optimized. My experience is that this is supremely unlikely.

My most recent experience with targeted advertising is that the business model is not effective. I spent an evening looking for a new pair of shoes from online stores. The next day, ads for shoes show up on my Facebook feed. But I had already bought shoes. I was no longer a potential customer in that market. No amount of advertising is going to persuade me to make a purchase, because the purchase was already complete.

More data doesn’t mean you understand your customer better. You need the right data- and ISPs just can’t provide that. Data science simply isn’t good enough yet. The algorithms consistently fail to capture human thought, intent, and desire. The greater danger in the loss of this privacy isn’t in other parties knowing who you are- it’s in other parties THINKING they know who you are.

This example reveals two facts that render third party purchases of consumer data useless: a single data point or grouping of data points doesn’t tell you all of the important data about a consumer, and second, consumers move faster than companies. For the same reasons that cause all of us to receive junk mail addressed to people who haven’t lived at an address for years, (or even addressed to deceased persons), companies efforts to use consumer data are routinely ineffective. The myriad problems with the over-reliance on big data is its own subject, but one that informs this issue.

The effort to make money off of violating privacy won’t work because companies aren’t equipped to turn data into sales.

III. “This Is Fair.” Justice Requires That ISPs Pick A Single Classification: Common Carrier or Private Enterprise

There is a doctrine in tort law that common carrier services like buses and trains have reduced duties to customers. Private carriers have more discretion about how to run their business, but have increased liability. In the famous tort case Paslgraf v. Long Island Railroad, a railroad company was not held liable when a passenger’s explosive package accidentally detonated, causing injuries. Part of the reasoning relied on the notion that the railroad was a common carrier, and such service providers are not liable for some acts of their customers because they have less discretion regarding their customers than a private carrier has.

This reasoning ought to be applied to internet service providers: ISPs can be either a common carrier or a private carrier, but must accept the responsibilities and limitations of whichever classification they choose.

If ISPs want the benefits of being private enterprises, they need to take on the liability commensurate with those benefits. The concept of safe harbours in the DMCA is predicated on the notion that ISPs are a sort of public utility or common carrier. ISPs that want the benefits of private business need to be liable for crimes and damages that common carriers would not be liable for.

ISPs believe they have a right to the data of their individual customers, such as their browser histories and app usage rates. If they are so interested in the private information of their customers, they should take on criminal liability for crimes committed by their customers, from piracy to identity theft to terrorism or child pornography. This is the burden of responsibility. If an ISP is truly entitled to the content of a customer’s online activity, they are responsible for that content. There is no entitlement without responsibility. This is a fundamental precept of justice that permeates the law.

If the ISP does not want to be liable for the crimes committed using their services, they must opt for the common carrier approach to providing internet and information services. The idea of ISP access to consumer data without responsibility to the consumer is not just offensive to privacy or comfort- it is offensive to the very concept of justice and fairness. It is the ISP getting something extra from a consumer in return for nothing. Forcibly taking from someone in exchange for nothing is the clearest possibly understanding of theft.

Conclusion

The data that ISPs will sell to 3rd parties is unlikely to make advertising substantially better, due to the challenges in execution. The larger issue is settling the classification of ISPs in the context of telecommunications law. ISPs can be either private enterprises or common carriers. They cannot continually shift their classification from moment to moment to suit convenience, reaping rewards and rejecting responsibility.

Update: ISPs earn their place… And they really have a cultural status.