Author: Paul Wallbank

Paul Wallbank is a speaker and writer charting how technology is changing society and business. Paul has four regular technology advice radio programs on ABC, a weekly column on the smartcompany.com.au website and has published seven books.

Tinny vapid crap – last week’s links

Links for last week – from Apple’s child free campus and the NBN’s coffee machines to Elton John’s take on modern pop music.

Last week was an interesting time with an appearance before a Senate Committee and a trip to regional Victoria to talk about the media and social justice.

While busy, there was time to read some fascinating articles ranging from Elton’s John’s views on modern pop music, software lawsuits and early losses in the war on ‘fake news’ through to how the shiny new Apple campus boast almost everything for employees except a childcare centre.

Parents need not apply

Apple’s new 5 billion dollar campus is the realisation of Steve Jobs’ final vision. It boasts a hundred thousand square foot gym and an attention to detail that extends to the sand used to make the windows.

But it doesn’t have a day care centre, which gives a pretty clear message to aspiring employees – if you don’t have a stay at home spouse, something pretty rare in the hyper expensive Silicon Valley, then don’t bother applying.

Thanks a latte

Meanwhile in Australia, the government financed National Broadband Network is spending half a million dollars a year on maintaining its staff coffee machines.

While the money is small change in a project recent estimates put at costing $56 billion, it is emblematic of how far from its original purpose the vision has drifted.

Facebook Fails to Tackle ‘Fake News’

The social media’s attempts to tackle ‘Fake News’ are failing dismally reports The Guardian as reactionary groups gleefully reshare and publicise anything flagged as such.

While it’s early days, this isn’t a good start for Facebook although it also illustrates how powerful filter bubbles are and the lengths people will go to spread their ideologies.

The lawyers always win

Lasts week’s ransomware scares will trigger lawsuits says Reuters, quoting several legal experts.

Unsurprisingly, it won’t be Microsoft who’ll be the target given their almost bulletproof terms and conditions but businesses who didn’t patch their systems could be liable.

Fox News’ founder passes

Roger Ailes, the founder of Fox News and one time Nixon adviser, passes a few months after being ousted from the network he created.

Ailes personified the tabloidisation of the media as Rupert Murdoch applied the model which had worked so well for him at The Sun in the UK to newspapers and television in the United States.

Many blame the internet for the click bait, sensational model of modern news reporting but the pattern was well established by the time the World Wide Web came along in the mid 1990s.

Tinny, vapid crap

Elton John weighs in on the state of pop music.

 

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Roger Ailes’ legacy

The passing of Fox News’ founder Roger Ailes is an opportunity to reflect on how the media has affected moderan society

The passing of Roger Ailes, former NIxon advisor and founder of Fox News, is an opportunity to reflect on how the media has evolved over the past forty years.

Ailes’ work shows how click bait, fake news and filter bubbles are not products of the world wide web but pre-date it by at least twenty years with the rise of tabloid television and the modern version of yellow journalism designed to scare people.

While the web and social media proved wonderful ways to spread such messages, it was the arrival of programs  like A Current Affair twenty years earlier in the United States and reporters like Steve Dunleavy who changed popular journalism and taught us to fear our neighbours.

The results of that have been profound in everything from kids not walking to school any more to the magnificently wasteful prison systems all of the English speaking countries have built in response to hysteria over crime rates.

Ailes and his colleagues found a successful media model that attracted viewers and advertisers which set the pattern for today’s febrile environment of fake news and filter bubbles that have ushered in the most unstable and reactionary political climate since the early 1930s.

Where we go next remains to be seen, it’s a shame Ailes won’t be around to pay the price of his works.

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Funding journalism’s future

The inquiry into the future of public interest journalism heard many ideas for supporting media ventures but few sustainable business models.

Following this week’s appearance before the Senate Committee into the Future of Public Interest Journalism, details of which are now up on Hansard, it’s worth reflecting on some of the ideas floated during the hearing on funding media organisations.

As the union reps illustrated, the challenge facing media organisations is acute with the Media, Entertainment and Arts Alliance spokespeople telling the committee how at least 25% of industry jobs have been lost in the last decade as the sector struggles with collapsing advertising revenues.

Ideas to find new sources of income ranged from crowdfunding, government funding, tax concessions and levies on the internet platforms like Google and Facebook.

Crowdfunding

First up for the morning were the team from Crinkling News, a kids newspaper. Saffron Howden, the publication’s co-founder and editor described how the founders had self funded the publication but after a year of operations they were hoping to raise 200,000 dollars through indiegogo to keep the doors open.

Senator Ludlam, the Committee’s Greens member, observed that running an appeal every year is hardly sustainable, something Howden agreed with saying the funds are to give the newspaper ‘more runway’.

Crinkling made its $200,000 target this morning, so for now the paper is saved. It will be interesting to see if Howden and her co-founders will find that sustainable revenue model rather than just an accessible form of capital.

Government subsidies

One of the obvious models for Crinkling is a government subsidy, Senator Ludlam asked if the paper had received any funds from state education departments to which Howden replied they hadn’t.

While for a specialist publication like Crinkling government subsidies may be an answer, most of those giving evidence were cautious about suggesting direct payments as an answer for the industry’s woes as it opens scope for interference in editorial policies.

There is some precedent for this in Australia, with the Victorian government supporting The Conversation but given how arbitrary Australian government programs are – not to mention the priorities of spending taxpayers’ funds – it’s hard to see how politically acceptable that is.

Tax concessions

Something more politically acceptable may be tax concessions to investors and founders similar to the R&D grants available to technology companies or the producers’ offset available to film producers.

I went further during my questioning and suggested something similar to the 10BA concessions that were available to the Australian film industry during the 1980s which unleashed a wave of innovation and new talent but were misused terribly by taxplanners – something that would give the Treasury apoplexy.

While this is an idea that may well get legs during the political bargaining over the media reforms, it won’t however solve the revenue problem.

Charitable or not-for-profit status

A variation on the tax concession idea was to allow media companies to have not-for-profit or charitable tax status. It’s hard not quip that most media ventures are already run on basis where they don’t make any money.

Under this idea, subscribers to media services would be able to claim their fees as a tax deduction which may encourage more people to sign up.

This idea also seemed to find a lot of support from the Senators and may well form part of the political horse trading. Like some of the other ideas there may be a potential problem with defining what exactly is a media company or a ‘journalist’.

One opportunity these last two options opens up is for philanthropic ventures, like the Guardian’s Scott Trust or the short lived Global Mail, to enter the field. Some cynics would say The Australian already operates on that model, but as the Global Mail’s brief life shows, generous benefactors tend to be rare.

Reforming copyright

Also attracting a lot of interest was the idea of updating copyright laws to force search engines, social media sites and content aggregators or scrapers to pay fees to creators. This could be done through an organisation like the Copyright Agency with fees passed onto media companies.

Tightening the copyright laws has some appeal, but this could prove a double edged sword for journalists, writers and artists as fair dealing – or the US equivalent of fair use – becomes restricted and finds media organisation liable for using extracts of others’ works.

It’s also unlikely to raise much unless there was a co-ordinated global push to make the major online companies pay fees which in turn would increase the costs of running the system.

A ‘Google tax’

There was much indignant huffing about services like Google and Facebook using content and the possibility of levying them for the privilege.

Were this done internationally, this would be a huge pool but a number of speakers including Fairfax CEO Greg Hywood and freelance journalist Michael West pointed out, these services are also critical distribution channels and it is comparatively easy for publishers to block these sites if they chose.

That they don’t choose to block Google is indicative of how critical the service is to distribution, so while Google takes most of the ad revenue the media companies are still dependent upon it. Taxing these services might be counterproductive.

Where to for the future?

Overall the suggestions were all worth considering but the real question of how do you make money from media wasn’t really answered. While tax breaks and levies may help, the fundamental truth is most news outlets are not financially sustainable in their current form.

That in itself raises a question of whether incumbents like Fairfax and News Limited are really relevant to journalism at all – maybe the large established Twentieth Century companies don’t have a role in this era.

Should that be true, the question of how journalism is funded still remains open. As mine, Michael West’s and Crinkle News’ tales described, there is little in the way of sustainable business models at the moment.

Wednesday’s hearing didn’t give us clues to that viable model could be, so we continue the search.

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Journalism in the Twenty-First Century

Where does Australian journalism go in an age where media channels are dominated by Facebook and Google?

Today I’ve been invited to appear before the Australian Senate’s committee on the Future of Public Interest Journalism. Here’s my planned opening remarks looking at the challenges facing media organisations, particularly in an Australian context.

I’d like to start off by pointing out I’m not a career journalist, I fell into the media industry through a series of happy accidents starting with appearing on ABC Radio to discuss the Y2K bug twenty years ago, this evolved to where I’m now a freelance contributor to all the major Australian media outlets.

As a longstanding contributor to various ABC stations across Australia ranging from ABC Darwin through South Australia’s Riverland to the national Nightlife program where the hosts pretend to be floating somewhere above Middle Australia rather than admit they are in the Sydney studio, I have seen some profound changes within the organisation.

Due to cost cutting and political interference, the organisation has steadily seen power and resources concentrated in the Sydney head office to the detriment of local coverage and regional stations.

To be fair to the ABC, the same process has happened in commercial media – in print, radio and television – as flawed policy decisions over the last forty years have seen market power accumulating in Sydney and Melbourne at the expense of local content, diversity and regional coverage.

Wasting the digital dividend

One of the great missed opportunities of our time was the gifting of the digital TV spectrum to the established radio and TV operators.

The digital broadcasting switch was an opportunity to bring diversity back into Australia’s media landscape and spur both journalism and the creative industries.

A few minutes watching what the Free To Air networks have done with those new channels shows how that resource has been squandered.

This concentration of market power has left Australian media organisations saddled with a protected and well paid breed of managers incapable of responding to the threats posed by US and Chinese social media networks – not to mention streaming services like Netflix or the continuing catastrophic declines in advertising revenues.

Journalism as a team effort

Producing quality media to compete globally is a team effort. Good journalism isn’t just the result of good reporters, it requires good sub-editors, producers, researchers, photographers and a small army of other skilled workers. Not to mention strong, principled editors and station managers.

The media industry’s casualisation, something as freelancer I’ve encountered the brutal reality of, makes it difficult to develop those skills. The ABC is a good example of this where, outside of management and administration, there are few salaried staff aged under 40. This has great ramifications for the workforce, industry and the community.

It’s difficult to see what governments can do in the face of the global industry’s changing economics, particularly in the advertising industry’s shift.

We should keep in mind however if we were having this discussion a hundred years ago we would have been asking how people can make money from radio. Entrepreneur David Sarnoff who founded Radio Corporation of Australia figured out the commercial broadcasting model in the 1920s and that industry went on to become one of the most profitable of the last century.

So it may well be that encouraging a new generation of media entrepreneurs and journalists who can figure out 21st Century business models can be the best thing Parliament can do to ensure a diverse media culture that tells modern Australian stories to today’s Australians.

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Champagne tastes and short runways

In an age of startup unicorns, it’s not surprising investors are being burned

One of the curious things about the Silicon Valley business model is how fundraising is seen as an end in itself.

Most business proprietors would be philosophical or mildly irritated if they’d had to give up equity or go into debt to fund growth, but in startup land a whack of money is seen as success in itself.

Sadly that money isn’t always well spent as the story of the free spending Guvera streaming service shows.

Over the company’s eight years the founders raised $185 million which ran out last week leaving the 3,000 small investors out of pocket.

That small investors were even involved in such a venture raises eyebrows and suspicions aren’t helped by a funds manager charging huge commissions for their services.

 

Just the use of a middle man like AMMA Private Equity – which happened to be run by one of the co-founders – should have raised concerns however the high commissions should prompted questions from the investors about advisors’ interest in getting them into a high risk venture.

In the current overheated startup space it’s necessary to be skeptical about many of businesses claims and the amounts of money being raised, as big pots of honey attract the flies.

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Digital disruption and civil rights

In a digital world, power is becoming more centralised and the media enfeebled. Citizens need to be taking control of their rights.

Next Saturday, on the 21st of May, I’ll be sitting on a panel for the Talking Justice series on how digital disruption is impacting on journalism, individual rights and social justice. This is an early draft of what I plan to be saying about the topic.

The series will be held at Bendigo’s Ulumbarra Theatre in regional Victoria, tickets are available from the Loddon Campaspe Community Law Centre website.

In the middle of last year I stopped writing for The Australian after their budget for freelance tech journalists ran out. Over the previous two years the newspaper had been my main source of income.

To be fair to The Australian’s management, this was not surprising as at the turn of the century the paper’s IT section was the bible of the nation’s technology industry, often running to 64 pages as standalone liftout. It was a true river of gold for News Limited that employed over a dozen staff and contributors.

Now, on a good week there’s a couple of adverts in the single page section and it employs two and half full time equivalent staff.

The decline of The Australian’s IT section is not in itself remarkable – almost every newspaper has the same story as advertisers have moved away. In the case of the Australian IT, the employment adverts that funded the section’s heyday long ago moved to dedicated online sites.

How a million flowers didn’t bloom

For the broader media – including most news websites – Google and Facebook’s dominance in online advertising has meant even the digital dimes have become scarcer. Many of the ‘born digital’ or ‘web native’ publications are just as cash starved as their incumbent competitors, albeit with far lower cost bases.

The drying up of advertisers’ cash has left the media model in tatters and the early promise of the internet allowing millions of new media sites to bloom has long ago proved false leaving the world of journalism a hungry, desperate place.

For cyber utopians like myself who believed the web would usher in a new era where power  could be held accountable through citizens’ websites, blogs and social social media accounts, that disappointment is even greater as the internet is seeing power further centralised with extensive data dossiers being collected on every individual.

An example of just how comprehensively data is being collected and used is shown in this clip from the 2008 US Presidential election campaign.


That description is almost innocent by today’s standards as there are many, many more data points with social media, connected devices and – most of all – our smartphones tracking every moment of our lives and activities.

Imbalance of Power

A good example of how data is being used against citizens is the recent Not My Debt debacle where the government and Centrelink misused information to harass social security recipients.

Stung by the public outrage, the agency saw fit to leak a critic’s confidential personal data to a journalist, an action later justified by a departmental secretary as necessary to protect their organisation,. A view seemingly legitimised by both the Australian Federal Police and the responsible minister who both saw no legal or ethical problem with such behaviour.

That a experienced and long serving journalist along with a metropolitan newspaper saw fit to publish that lady’s personal circumstances also tells us the mainstream media, struggling as it is with both money and ethics, may not necessarily the protector of our civil liberties.

Rights and data brokers

Governments are not the only risk to our civil liberties, our connected lives give businesses huge control over what we say and do as well.

With the Internet of Things our cars, smoke alarms, electricity meters, even toasters and fridges are gathering information on everything we do and this information can be used in ways we don’t expect, from denying credit to identifying us as employment or credit risks.

Added to this is the end of ownership, where a purchase is only a license to use a product and that right can be cut off at any time.

In the US, farmers are downloading pirated Ukrainian firmware for their tractors so they can maintain them. In many countries, including Australia, even that may be illegal.

Should a consumer find their product is remotely shut down, they may have few legal remedies as many agreement insist on compulsory, and expensive, private arbitration rather than using the courts or tribunals to settle disputes. The terms and conditions underpinning the software licenses are so restrictive that it’s almost impossible to hold any supplier to account.

Ultimately to protect the general public from these corporate and government excesses, a strong media is required to publicise official malfeasance and equalise the power imbalance with the rich and powerful.

Where will a strong media come from?

Right now it’s hard to see where that strong media will come from with today’s broken advertising and revenue models. However it was equally hard a hundred years to see how people would make money from producing radio programs yet the broadcasting industry turned out to be one of the Twentieth Century’s most profitable.

To the question of ‘is everyone now a journalist?’ the answer has to be ‘no’ – the risks and costs are too high for the ordinary person who has to worry about keeping their job in a world where timid managers, not just at Centrelink, are frightened of even the mildest criticism.

Coupled with that are the high legal barriers, from defamation to confidentiality clauses the barriers to reporting on matters are steadily being increased and the costs of defending oneself from plaintiffs who’d rather not see stories written are punitive and beyond the means of all but the richest media organisations.

Rethinking journalism

It could well be that we’re returning to an earlier period of journalism where the trade was poorly paid and regarded, it was only during the post World War II years that the occupation became something that supported middle lifestyles.

With the stakes so high in an increasingly data driven world, it’s essential we do define the role of journalists is in today’s world along with give citizens the technological and legal tools so we can hold the powerful to account in the connected and data rich 21st Century.

Digital disruption has deeply affected the media and it is redefining our rights as corporations and governments use technology to amass more power. We as citizens, voters and consumers have to exercise what influences we can to ensure our rights in a digital word.

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Ransomware and innovation – links of the week

A Friday afternoon outbreak of ransomware dominated the week’s links along with the ethics of driverless cars and artificial intelligence.

Last week finished with a big bang as the Wannacry ransomware attack spread around the world with a curious twist which led one New York Times columnist to suggest software companies need to take more responsibility on security.

In the meantime the world goes on companies still struggling with the definition of innovation and Facebook crushing anyone who dares to try out-innovating them.

On a lighter note, Cary Grant spend much of his Hollywood years on LSD but it all turned out well and VentureBeat asks do humans have a role in a world run by Artificial Intelligence?

The future of humans

Is there a future for humans in a world run by artificial intelligence controlled robots? Venture Beat staged a panel in New Orleans that looks at where we fit into the automated world.

Ultimately the panel concluded, it’s up to us to make some serious choices. Something we shouldn’t leave to engineers.

The ethics of driverless cars

Autonomous vehicles should give priority to occupant over passers by in the case of an emergency suggests a Mercedes Benz engineer.

Christoph von Hugo, Mercedes’s manager of driver assistance systems, probably hasn’t helped the development of autonomous vehicles with his comments but the ethics of driverless vehicles is a discussion we should be having.

Defining innovation

Innovation is very simple, it’s about trying new ideas says Pete Williams, Deloitte Australia’s chief edge officer.

“You need ideas, they need to be new, new for you. If everyone in the world is doing something and you haven’t done it and you do it for the first time, you’re innovating. You’ve got to try stuff. Not just have new ideas, you’ve got to try stuff. Innovation is something you do,” he said.

Rethinking public transport

British transport app Citymapper is to launch its own ‘popup’ bus service in London with the promise of a modern and user friendly operation. An interesting twist for a software service.

“There will be a large screen that shows riders where they are in real time, and what’s coming up on the route — similar to how its smartphone app works. And they also have USB charging ports.”

Snapchat feels the market chill

One the darling unicorns of the tech industry, Snap, reported its first results as a listed company and the results were not good as Facebook’s shameless copying of the service’s features takes its toll.

Sadly Facebook seems to be following the Amazon playbook of crushing upcoming competitors that refuse to be bought out. This is a part of a broader problem with modern American capitalism.

What is Wannacry

Security researcher par excellence, Troy Hunt, gives a full run down on the Wannacry ransomware and how to combat it.

Towards the end of his article he has a list of eight actions computer users – from major organisations to households can do to protect their systems. Depressingly these are exactly what the computer tech support industry has been telling people to do for the past twenty years.

Wannacry’s accidental hero

An anonymous British IT security researcher realised the malware has a ‘kill switch’ – so he activated it. He does have an important message for computer users though.

“This is not over. The attackers will realise how we stopped it, they’ll change the code and then they’ll start again. Enable windows update, update and then reboot.”

An age of insecure machines

One of things that might bring down an AI controlled world is insecure machines as Wannacry shows. In the New York Times technology commentator Zeynep Tufekci suggests we can’t stop the wave of attacks taking advantage of systems running out of date software and vendors need to take responsibility.

“It is time to consider whether the current regulatory setup, which allows all software vendors to externalize the costs of all defects and problems to their customers with zero liability, needs re-examination.”

100 trips in tinseltown

Cary Grant got through his Hollywood years by microdosing on LSD claims a new documentary. When he retired from the movies he quit the speed and lived happily every after.

Interestingly, microdosing is one of the strategies used by today’s Silicon Valley workers to get by in their stressful and demanding roles. Some things never change.

Earworm of the week

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