
An Alternative History of Silicon Valley Disruption - pmcpinto
https://www.wired.com/story/alternative-history-of-silicon-valley-disruption/
======
Endama
This article touches on an idea that I think many in the tech industry (myself
included) continue to be myopic about: as disruptors we are held responsible
for the negative social outcomes that we bestow upon society. I think many
(not all) of us who work in software believe that the innovations we unleash,
in-and-of themselves, make up for nearly any negative externality caused as
consequence. We have brought services or experiences that have made life more
convenient, faster, more accessible, etc.; that should be more than sufficient
to legitimize our existence and effort.

Inside this framework, the driving factor is what Wired calls "techno-
darwinism" the idea that software companies are "still standing post-
disruption must have survived because they were the fittest". If you talk to
people in SV, especially after the depression, the stereotype was that every
startup was about to "change the world by becoming the [X] for [Y]" (Uber for
cookies, AirBNB for laundry, etc.)

However, the outside world looks at us with disdain: they don't view our
motivations as a desire for simple innovation or creativity, but outright
greed and power. The folks that we have disrupted are often those who do not
have the means to convert their labor to new industries; even when they do,
those industries then get disrupted by some new actor.

Tech workers also have, stereotypically, been disdainful of government: it's
too slow, too compromised/corrupt, too inefficient. However, engagement with
the polity is the main vehicle by which the poor and disenfranchised are are
able to find some kind of recourse for their lives, either by the ballot box
or the ammo box.

I've been telling my non-tech friends recently that the great sin of our
industry is not greed, its naivety and hubris.

~~~
malvosenior
> _However, the outside world looks at us with disdain_

The only people that view the tech industry with disdain are journalists and
old media.

Regular people happily use their iPhones, Facebook, Uber, AirBnB...

Just because a lot of ink is spilled trying to keep outdated media models
alive, it doesn't mean the general population feels this way. The success of
all of these services is proof enough that people are not bothered.

~~~
borkt
Yeah, they are too busy being addicted to candy crush without realizing that
was precisely the intention. My wife, who is not an engineer (she works in
applied science) is disgusted with how the technologies have been used to take
advantage of the general public. She hates how airbnb has caused a town we
wanted to live in to now lie around 24% of homes unoccupied outside of summer
while housing prices continue to rise because Airbnb has made it a better
value to keep houses away from long term rentals. You are being incredibly
naive to even have a catogory called regular people. I am an engineer who
builds infrastructure and manages projects each day. I can code but I am not a
"software engineer". I am baffled how people at google, facebook, and the like
who are funded by ad revene (from ads no one really clicks on or views) can
sleep at night knowing how their products have caused so much harm.

~~~
paulddraper
> take advantage

What makes it "take advantage" and not "serve"?

People want entertainment on their phone. So entertainment is provided.

People value seasonal rentals more than permanent housing. So seasonal rentals
are provided.

What party is being "taken advantage" of? What coercive or dishonest elements
at play?

~~~
smacktoward
"People want heroin. So heroin is provided."

~~~
adventured
There's absolutely nothing morally wrong with using heroin.

People want cheeseburgers, they're provided. People want marijuana, it's
provied. People want alcohol, it's provided. People want sugar, it's provided.
People want to gamble, it's provided. People want pornography, it's provided.
People want violent movies and video games, it's provided.

You can outlaw so called sins, negatives, or you can properly regulate them
and treat people that become addicts. Heroin is obviously an extreme example
of that context. There is only one effective solution to heroin addiction:
treat addiction, do not outlaw heroin use. It should be safely, legally
provided to people that need it.

------
empath75
> For instance, the same year the government loaned $535 million to solar-
> power company Solyndra, it also loaned Tesla $465 million. “Taxpayers footed
> the bill for Solyndra’s losses—yet got hardly any of Tesla’s” gains, she
> says. Solyndra has become “a byword for the government’s sorry track record
> when it came to picking winners,” a story that has helped keep regulators at
> bay, she says.

I'm no Tesla fan, but that's sort of how loans work. You get your money back
plus interest. It's not a lottery ticket. And Tesla paid back their loan
early. I don't think the program lost very much money overall.

~~~
wpietri
That is how loans work. But in a free-market economy, loans also come from
professional lenders, who price loans according to risk. Government loans made
to further industrial policy are necessarily subsidies, which is not how loans
work.

From the view of the economy as a whole, it can work out fine, in that we tax
the profits of the successful companies. (Although a great deal less than we
used to.) But it does rather put a hole in the myth of self-made men and the
companies they built from nothing.

I'll also note that Silicon Valley has a university at the heart of it. We
fund a great deal of research, and we should. We also subsidize education in a
variety of ways. But the first version of Google was developed by grad
students as part of their student work, and Google today hoovers up quite a
number of recent graduates from schools are either publicly run or receive a
great deal of government assistance. It's a highly interdependent system. I
think that's great, but don't think our myths acknowledge that.

------
technobabble
Books mentioned in the article:

\- How American Work, American Business, and the American Dream Became
Temporary by Louis Hyman

\- The Value of Everything: Making and Taking in the Global Economy by Mariana
Mazzucato

\- Winners Take All: The Elite Charade of Changing the World by Anand
Giridharadas

edit: formatting, copy paste issues (argh)

~~~
albntomat0
The book by Mazzucato is "The Value of Everything: Making and Taking in the
Global Economy"

~~~
technobabble
Thank you

------
hndude
Any additional evidence (either for or against) the claim that government pays
for tech advances, while the private sector is who sees a return from that?

~~~
empath75
Federal spending accounts for 44% of basic research spending. at one point, it
was as high as 70%.

[https://www.sciencemag.org/news/2017/03/data-check-us-
govern...](https://www.sciencemag.org/news/2017/03/data-check-us-government-
share-basic-research-funding-falls-below-50)

Generally, the pattern has been that government and university funded
researchers make the early discoveries, and then corporations do the research
towards applying them. Universities benefit from patents, but the federal
government doesn't.

~~~
JackFr
One of the things that makes research "basic research" is that there isn't an
obvious financial incentive for it. IBM, AT&T and Xerox at the height if their
monopolies could afford to do some, but in general it's a financial loss on
the timescale of a human or a corporation.

But what we see sometimes (alternative energy, drug research, e.g.) is
government funding of applied research, and that isn't good for the market or
the science, and should be called out.

~~~
Retric
Locking up applied research at companies often creates a lot waste as several
companies do the same research and don’t share their results outside of
patents/products.

------
malvosenior
How can someone write a whole article about disruption but not actually use
the correct, well understood meaning of the term? They literally just made up
their own strawman definition of what "disruption" means (tech people getting
rich I guess?).

Disruption has always been used to mean disrupting established market leaders
via innovation. Guess what? That's exactly what has happened with Uber,
AirBnB, Amazon...

If anyone wants to learn more about the actual meaning of disruption, I
suggest _The Innovator 's Dilemma_:
[https://en.wikipedia.org/wiki/The_Innovator%27s_Dilemma](https://en.wikipedia.org/wiki/The_Innovator%27s_Dilemma)

~~~
rootusrootus
> Uber, AirBnB, Amazon

Amazon, sure, but Uber & AirBnB? Wasn't their "innovation" flaunting the law
to gain a temporary advantage before regulation leveled the field again?

~~~
malvosenior
Uber disrupted taxi companies.

AirBnB disrupted the hotel industry.

Both used technology to get there (there were no apps to hail taxis anywhere
near feature parity with Uber for instance). They also leveraged the
distribution mechanisms of the app store to reach scale.

> _Wasn 't their "innovation" flaunting the law to gain a temporary advantage
> before regulation leveled the field again?_

Whether you view it that way or not (I don't) it doesn't change the fact that
these companies successfully disrupted established players. It doesn't matter
if it was "innovative" (again I think it was), the end result _was_ textbook
disruption.

~~~
ThomPete
Uber and airbnb outcompeted them by offering lower prices and disregarded
obviously outdated laws. The phone was what actually disrupted the industry
not the actual services.

~~~
JackFr
> disregarded obviously outdated laws

That's disruption?

~~~
ThomPete
Not in its technical sense but if you want to understand what they did its
important to take into account as it obviously worked.

------
thoughtexplorer
> (One of the future Trump adviser’s least favorite words? “Politics.”)

What's with this unrelated off topic dig?

Secondly, what's the point they're trying to make? That Thiel is a hypocrite?
If so, you can both hate politics/government and work to try to improve it.
One strategy is to do so from within. Musk was trying to do the same for a
while.

------
plankers
Can confirm, was a contractor in Silicon Valley. The "narrative" these
executives sell is little more than an opiate for their fleets of highly-paid
engineers to feel like they're justified in having a salary several times
higher than the contractors they work with on a daily basis.

~~~
C1sc0cat
Huh don't self employed contractors make more in terms of $ to cover the extra
costs 3x is norm in the UK.

~~~
maxxxxx
This is how I know it from Germany but in the US most contractors seem to make
less than employees.

~~~
curuinor
My contracting rate was double my hourly rate...

~~~
dredmorbius
Given taxes, bench/beach time, risk premiums (unexpected downtime, search
costs), that may well be too low.

------
charlesbradshaw
This article deeply disappoints me as Hacker news is the last place that I
would expect to find Luddites.

> _They promised the open web, we got walled gardens_

Google doesn't give out its users data in the same way that a bank doesn't
give out it's users balances.

> _...many of the dystopian business practices we associate with fast-growing
> tech platforms [like] operating with a small group of well-paid engineers,
> surrounded by contractors_

The implication here is that before Amazon, no company applied aggressive and
unethical cost saving measures. When was Nestle founded again?

> _Uber did not cause this precarious economy. It is the waste product of the
> service economy_

This is the kind of thing that makes you sound smart but means nothing. There
is not an explanation of the "waste product of the service economy" that
follows this quote. In fact this implies it is not Uber's fault at all for
disrupting the taxi industry.

> _In the case of venture capitalists, [...] their real genius appears to lie
> in their timing: their ability to enter a sector late, after the highest
> development risks had already been taken, but at an optimum moment to make a
> killing_

The implication being that nobody made a competitor company before the
internet was around. The other claim is that being n+1 to the market gives you
a guaranteed and significant advantage. If this was the case it would be
trivial to overtake Google.

> _The tech visionaries’ predictions did not usher us into the future, but
> rather a future where they are kings_

This line tells me that the author has gotten used to modern day conveniences
that tech has brought us and thinks its unpredictable that people who made
companies that span the globe are rich and powerful.

------
mcguire
It's nice to see Wired still has their visual panache, but how do I get rid of
the pop-up ad covering half the screen?

~~~
dredmorbius
[https://outline.com/https://www.wired.com/story/alternative-...](https://outline.com/https://www.wired.com/story/alternative-
history-of-silicon-valley-disruption/)

------
prepend
I’m not sure what this articles point is. Disruption as called by Christensen,
Andreeson, Thiel, etc all talks about displaced jobs and industries. I don’t
think this is unknown. It’s just that the benefits outweigh the costs (to
some).

So this isn’t an alternative history more than it is just a weird anecdote or
two without follow-up.

I’m not sure what Wired is as a magazine any more. It really needs
knowledgeable editors to plan and shape stories along some theme. I feel like
these stories about rich and bad Silicon Valley is are pretty common and all
boil down to the same reality that Silicon Valley has high margins and makes a
lot of money for in demand employees and stockholders. This isn’t relevatory
though and I’m not sure what Wired’s angle is.

~~~
JackFr
> I’m not sure what this articles point is. ... > So this isn’t an alternative
> history more than it is just a weird anecdote or two without follow-up.

It's weird. The article seems to be a book review somehow cast as a news
article or thought piece. Read as a book review it's a perfectly reasonable
and informative.

