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How a Tech Billionaire Created Two Fortunes and a Software Sweatshop (forbes.com/sites/nathanvardi)
216 points by tomohawk on Nov 23, 2018 | hide | past | favorite | 144 comments

"His workers must agree to install spyware on their computers so Crossover’s productivity team can track the number of times they click their mouse or stroke their keyboard. The tracking software takes screenshots every ten minutes and, in some cases, snaps photos from PC webcams."

If they really believe they can measure programming ability by the number of times their workers are clicking things, I'd give a wide berth to their software products.

They're hiring the software equivalent of Subway sandwich artists, not chefs at two-Michelin-star restaurants. Sure, both jobs involve placing cheese on top of bread. But in one of them the goal is to do it repeatedly and reliably, not creatively or innovatively.

As a former cook in one and two Michelin star restaurants, I can assure you I move 10X faster than a Subway sandwich artist. I make 10X as many moves with precision. A single mistake can make the whole flow go to crap. Moreover, I can continuously track the temperature of upwards of 100 pieces of different types of meat and fowl, 5 or 6 venison loins, 15 veal chops, 25 pieces of filet, 25 pieces of rack of lamb, ect. I can do that with the optimal rest period before the meat touches the plate. Another place I was leading the fish station. We would plate 40 scallops dishes and 30 of the sea bass dishes at a time with a team of 3. (https://www.foodnut.com/i/Picasso-Las-Vegas/Picasso-Las-Vega...) The cook who did this didn't get the correct angles on the cauliflower quenelles -- so far from perfection.

I write software now. I helped open that kitchen. The first couple months is engineering, how to get organized to plate 90 quenelles in 4 or 5 minutes under a heat lamp. Writing software is just like engineering that kitchen everyday all day, month after month. It's not about creativity or innovation with food. It's about creativity and innovation with solving engineering problems.

In case anyone is curious, the reason why he said cook rather than chef is chef is a position in the kitchen. It's French for chief and there's only one in each kitchen. The chef doesn't actually cook much himself.

I'm consistently amazed by the diversity of folks that post on HN. It's why I keep coming back!

same. Great response A+

Awesome life story, with that Michelin star kitchen skillset you have the grit and interpersonal leadership skills necessary to lead a team of devs into the unknown and produce results that matter, hopefully at a director or above level.

Can you see yourself doing this? We need more diversity at the senior leadership level, please consider it if you haven't!

Also if you don't mind me asking, can you share what made you leave your former profession, was it the stress/physical exhaustion? It seems like grueling work to say the least.

Thanks for sharing your background and perspective on HN!

> I can assure you I move 10X faster than a Subway sandwich artist. I make 10X as many moves with precision

Two or three times, sure, but ten? Any more info on this? Are Michelin cooks superhuman or Subway people so terrible?

I believe it's the parallelism. The subway setups I've seen only allow for about 5-6 concurrent sandwiches, an assembly line of sandwich artists working serially, and their ingredients are basically preprepared. Sounds like this Michelin cook was handling the preparations of each ingredient, including making sure each ingredient is ready at the same time, and then plating them. The quantities of each ingredient they were handling at a time was also much greater.

Are software engineers for hedge funds sandwich artists, or chefs at two-Michelin-star restaurants?

Is the answer to every question, "Who is actually doing something creative and innovative?" always, "Me, and everyone else is not?"

Is it bad for software engineering that its reality is starting to resemble subway sandwich artists, and its fiction inside people's heads resembles being a Michelin star chef?

The owners of the hedge funds want the equivalent of sandwich artists. The sad part: it's possible.

Right now though, it's more like a popular restaurant chef. Moving to the McDonald's model eventually.

I don't really think that there's such a huge difference between developers in remote countries and developers in first-world countries. Just like many programmers would have imposter syndromes, many unheard-of programmers in poorer places are equally great. The only (or at least foremost) reason they're paid less is simply that they can afford to live a good life with such pay anyways.

The biggest disadvantage to those outsourced developers might be that they didn't have the chance to learn English as well as the first-world devs, and thus might have issues with communication, which is a huge part of software engineering for sure. But in terms of abilities to learn, they are not worse than anybody.

Great comment. Made me reflect on the need for different kinds of software development - each relevant, but completely different in execution.

What really worries me is that most non-tech companies (and even some tech companies) don’t understand the difference and frequently allocate resources inversely - paying the equivalent of a Michelin chef to make subs and trying to get top dollar dinner cooked with teams barely skilled in the subject.

The “cloud wage” story could be very compelling in such situations, but it will likely lead to a lot of issues with the more complex systems. Someone has to be the true “architect” and own the successful evolution of the software/business.

Back in 2014, this article struck me as very insightful on the subject: https://www.japantimes.co.jp/news/2014/04/07/business/gods-e...

If you only have automation or low-end jobs, you are going to lose the ability to make transformative/revolutionary moves. You will still have the ability to refine existing processes, but there are definitely diminishing returns to consider.

The other item that’s also glossed over is sheer productivity - when dealing with more complex issues, experienced developers are a lot more productive, so your $15/hr can easily turn into 10-20x more hours with the wrong experience choice, in the end costing you more.

Hate to use a cliche, but “the right tool for the right job” applies to software too.

And then they evaluate people on their Michelin-star-worthy work, which leads to the phenomenon of "promo-driven development" - people building new complex systems (that immediately turn into legacy code) because they don't get rewarded for doing something simple and maintainable. And then you need more Michelin-star-worthy chefs to keep things running because no sandwich artist will be able to figure it out.

> The other item that’s also glossed over is sheer productivity - when dealing with more complex issues, experienced developers are a lot more productive, so your $15/hr can easily turn into 10-20x more hours with the wrong experience choice, in the end costing you more.

When you are the "consulting company", you don't care. You just get to bill more hours.

If you are the client company, you don't care, either. Anyone with half a brain cell in this day and age knows that outsourcing software development is wholesale idiocy. So, if you're doing that, you are either 1) idiots or 2) outsourcing for political reasons or 3) both.

Interesting article. At least three super-cars, or rather, hyper-cars, are built by hand : McLaren, Koenigsegg and Pagani all use plenty of high tech but have workers who are lifers.

Remote developers from 'shithole countries' get paid $15/hr because it's big money where they live, not because they are unqualified.

Your options to compete with them are very limited.

Michelin chefs don't make subs for any price, let alone at commodity labor market price.

José Andrés makes these amazing little sandwiches at Bazaar in Los Angeles. They're transcendent.

It’s probably not aimed so much at actual productivity, which you can measure in other ways, as it’s a measure for behavioral control- in other words, making sure everyone is always a little bit anxious, feeling a little bit guilty, so that they don’t try to unionize or complain too much.

probably a secondary system for auditing..

previously worked on-site at a web hosting company which had similar sorts of spy systems in place - these weren't really checked or used as a primary measure, but more that spot checks were done to see if people were 'generally busy', and also when actual productivity (support request qty/quality) was down or discipline problems occurred the systems would be used to inspect/audit other performance.

programming is for sure less 'mechanical' than routine system support support requests, but I can see the same sorts of measurement as useful in a remote work / no trust environment.

I measure profundity of novels in ink expended, and the success of my parties in the amount of confetti cast. According to the spec this is the perfect procedure. My pet hamster has his doubts.

But writers actually do get paid by the word. Charles Dickens was famously paid by the page, and his novels ended up profound enough. I'd wager most professional writers are in the business to make a living, not to be profound.

According to this scholar[1], Dickens was not paid per word or per page, but “per episode”, as many of his books were published a chapter at a time.

[1] https://dickens.ucsc.edu/resources/faq/by-the-word.html

That resource says he was paid for every 32 pages. In any case, it seems like for at least some of his early books like The Pickwick Papers, he was paid proportional to volume of output and not to sales/quality. (For some of his later works he earned a percentage of sales.) It's a perfectly fine model for people who aren't already as famous as late-career-Dickens and it can nonetheless produce profound work.

I'd wager Dickens didn't have anybody stand over his shoulder, watching if he's delivering page after page at a fast enough rate.

so either they don't know that you can use an issue tracker (or VCS) to get insight into productivity, or they don't use an issue tracker (or VCS), or both.

what if it's just to scare them ? hey, stop f-ing around, we're tracking you

TimeDoctor has offered similar software for years.

I worked on their UI when they were also offering hiring services via staff.com.

Majority of freelance marketplaces use the same creepy tracking software for gigs paid by the hour.

Someone needs to create a tool that exercises your IDE and gives the impression of activity. You could run it in a VM while you get on with the real work.

“His father, Gregory, worked directly under legendary GE executive Jack Welch, and the Liemandts vacationed with the Welches. After his father left GE to be CEO of a mainframe software company in Dallas in 1983, Liemandt began programming but also took a strong interest in entrepreneurship, frequently reading the business plans his father brought home. As a Stanford economics major, he was determined to create the kind of business that either Jack Welch or his father would want to buy.

His obsession with sales efficiency spawned Trilogy, and in 1990, at age 21, he defied his parents’ wishes and dropped out of Stanford to build his software company.

Six years later his sales were some $120 million and he was on the cover of Forbes.“

That’s a pretty remarkable insight that’s tough to illustrate without including someone as venerable as Jack Welch. It’s the knowledge of what’s possible and how things are already being done that lends an amazing edge to talented/smart people born to the right circumstances. The cognitive leap that you have to make without this knowledge frequently leads people to over-estimate complexity and excellence you’d have to compete against. This first hand knowledge of exactly how top business plan, value and view opportunities is amazingly valuable.

The question is, how do you move this from being a family/birth advantage to being part of education?

To its credit, YC is trying to do that: https://www.startupschool.org/

I have no intention of starting a startup, but I watched some of the videos, and they seem like valuable new information.

More thinking in terms of kids/parents. In order to know that YC exists, the kid needs to learn from somewhere.

It’s the initial discovery problem. I feel that currently we have all the resources for those who want to start a company, but I don’t know if we are good at showing new genetraion what’s possible across the board. Imagine the innovation we could see if every capable kid got to hang out with Jack Welch and absorb that excellence?

Parents can advice kids to marry up. I think this is practical and profound advice. It would be applicable across different societies and it does not involve white, first world or big city privilege etc.

Also the accounting shenanigans of GE which are finally getting much more coverage lately and major role of Jack Welch in it. I'd think most of innovation by hanging out with Welch will be in separating fools from their money. Now a lot of companies would be like this but their CEOs do not get top billing like him.

Read far enough in and you'll find out he's a patent troll. I closed the article at that point. Not interested in articles idolizing patent trolls. Mysterious tech billionaire indeed.

I didn't get the narrative that the article was idolizing the subject, but rather talking about what he and his company are doing, which includes being a patent troll among other things.

Writing up a lengthy article about a person's accomplishments in a prestigious mainstream magazine, especially with a title calling them "mysterious," is definitely in the vein of hoisting the person up onto a pedestal.

Or under a microscope.

With the term "sweatshop" in the title, it doesn't seem like the intent is to idolize this guy. The guy's banked some serious bucks. Whether he's done that in a savory or unsavory way is left up to the reader to decide.

I agree with GP, this articles more glory than spotlight. Hard pass.

I read this much more as a cautionary tale to the existing tech industry - i.e. forget about automation, you’re about to get globalized out of your lucrative dev jobs.

The same claims were made during the outsourcing craze of the 90 and early 2000s. Companies tried to save money by sending development overseas to Indian sweatshops. They quickly learned you get what you pay for. If you need some backoffice crud app, Crossover will work. If you're building a customer facing app or anything with any significant complexity that requires fixes and features addition, you need inhouse people for the experience and expertise. The restaurant escape is great. You can automate like subway does and get decent fast food. You want a good meal that makes an experience you'll remember? Better find a great chef and kitchen staff for it.

I agree 100%, but to many executives it’s simple dollars and cents.

How having the word "sweatshop" in the title is trying to glorify the person is totally beyond me. So any lengthy investigative journalism that lists the subject's life story is a glorification? Then all the media attack on Donald Trump's history is also trying to eulogize him then.

Also I find it amusing that it's the "patent troll" part that turned out to be repulsive to you, but not the part about paying remote devs much less money than local devs.

From everything I know about software development, I can't imagine anything of value being created under such circumstances. 50% of software development is not coding. I suspect what is getting created is crap, but crap that can be leveraged to make money and get that 3 billion to keep going up.

That's the sad part about the article to me - at one time the emphasis in computing was, well computing. In our modern age, it's money.

Glad I was there for the good part.

That's the thing, from the article it appears that absolutely nothing of value is created by these portfolio companies. Instead, ESW is buying companies who have done all the hard work a long time ago (using highly-paid creative employees) and feasting on whatever revenue they still produce while cutting costs and paying contractors just enough to keep things operational.

I've seen my fair share of guys like him. They get rich by buying the crap that people don't want and doing the crap that people don't want to do. You hated them because you felt like it went against the laws of the universe for these sorts to be so successful. You never envied them though, because you realized that these people had miserable lives despite being rich.

As long as these people are looked down on more than they're looked up to, I think we're fine.

My thoughts exactly - crystallized much more succinctly and elegantly than I could have muddled them out.

Trilogy also created a great deal of crap. They came to my engineering school in the late 1990s and handed our student society $500 just to give us a free lunch.

Many of my friends went to work in Texas for them, only to escape a while later after toiling away on projects for fortune 500 companies which were massively overbilled. Their formula was: hire new grads, pay them well and take them to parties, and soak big corps with dot com projects they neither needed nor understood.

The article is correct in pointing out that many Trilogy grads went on to do great things. But this was not Trilogy’s doing. It was because these people are smart and would have succeeded anyhow.

As for the new strategy of paying $15/hr for sweatshop C++ coders... I can only imagine the quality of that code. You get what you pay for.

Just a note on wage:

$15/hr for C++ coders will get you a highly-talented coder from poor parts of the World who may rival your above-average C++ coder in developed countries.

$15/hr is still a very good wage in poor countries.

For $15/hr, you do not get top quality C++ developers from any corner of the world. I know - I've worked for companies that have tried. You tend to end up with a spaghetti code base utilizing crappy open source or shareware libraries that a cousin produced. Then, you try and scale, and need to bring people that actually know what they're doing.

2 years in at current job, where most of the work was done by offshore devs, company now has a team of onshore developers to fix all of the performance and stability problems.

There is a lot of variance in $15/hr offshore developers. For example, you can buy a shirt for $10 in various places in the world, some of them will be total crap and some of them will be exquisitely tailored. The selection becomes the challenge and just because someone failed doesn’t mean someone else did.

I don’t agree with the false equivalency of open source or shareware meaning a lib is crap.

You probably never tried working with remote parties.

It's not that easy and you can bet that some hours are just doubled as well.

Adding to that: 15/hr is a decent wage in many countries, but you'll be paying at least 30 due to overhead and a middleman which will be the one really profiting.

And the middleman might bait and switch you on a 7/hr junior coder.

No way. I recently put together an off-shore dev team. We interviewed folks in Mexico, Poland, the Philippines, China, and India. The quality differed and the price differed, but not by huge amounts. No one charged $15/hr for a decent developer. $30-50/hr was the norm.

$15/hr now . . . and $150/hr to fix it later.

And this company seems to have cracked the system for finding, training and managing those people. I suspect many poor offshoring examples fail because those processes were poor - and expensive.

No, dude, you're wrong. 15 an hour doesn't get you a skilled and experienced freelancer / contractor anywhere in the world. Good quality costs. Everywhere. It is cheaper than in the States, but not that much. If you're looking to hire someone good, expect to pay like 40 an hour, at least.

This comes up every time there's a talk about remote work. Why would a highly-talented coder accept this wage instead of looking for some other remote options?

I recall a friend back in the late `90's commenting negatively about Trilogy's recruitment activities. I have no doubt their workplace culture left a mark on Austin.

A skid mark.

It sounds like ESW is buying companies where the creative work was finished years ago. The policy appears to be freezing innovation and cutting costs to profit from existing contracts. I suspect the goal is not longevity. It’s also uncertain the company under highly paid and creative stewardship would not also fizzle out after a decade or two.

It's pretty much what private equity companies have been doing with aging enterprise software firms but taken to the next level re replacing virtually everyone.

There's still plenty of demand for good developers, it's simply that the amount of code written has increased enormously and is being provided by a more democratised system. The person bringing into existence‡ that app for your local pizzeria probably doesn't even need to know what an A* search is, but doesn't need to either. There's even a change it's reasonably secure with your CC info by using some library from the CC clearing companies‡‡

There is a separate and unrelated problem that your bank may also be outsourcing its app to these lightly-trained developers, but that's the bank's poor choice.

‡ I avoided the use of "write" though that's still the case, but in the longer term the app will pretty much be written a la frontpage or powerpoint, or even more high-level (some AI app that just asks some questions and spits out most of the app).

‡‡ I know, I know, but a nerd can dream, can't one?

"The person bringing into existence that app for your local pizzeria..."

I don't think that's what's going on at Mr. Liemandt's Code Grinders as it would be completely impractical.

The pizza place would most likely need a lot of help in having something useful built for them, website or app. It would take hours and hours of back and forth to get their business requirements nailed down. Communication, and trust, are the key elements at this point.

Then when development starts, your going to need to show them progress, get feedback, and revise. Then you're going to need to do QA side by side with the pizzeria to make sure you've met their needs.

Picture this all happening through email, or Slack, or some portal with someone in another country, with ESL, and maybe a different time-zone. I've seen it, and I tell you what happens. When it's all said and done the pizzeria takes it to someone they can sit at a table with and figure out how to fix/use/abandon it.

And those payment gateways? Don't get me started. Even PayPal, a huge company with lots of resources, has a terrible muddle for their APIs. There are exceptions, but I've always been surprised by payment gateways lack of quality.

Edit Added an "and"

Wage arbitrage for software Continuing Engineering (i.e. maintenance) talent. This article is eye-opening due to the scale and effectiveness, but unfortunately not surprising.

sorry, but what exactly is unfortunate about it?

> Liemandt and Trilogy’s other founders developed their software as undergraduates at Stanford. The young Liemandt seemed destined for business success. His father, Gregory, worked directly under legendary GE executive Jack Welch, and the Liemandts vacationed with the Welches. After his father left GE to be CEO of a mainframe software company in Dallas in 1983, Liemandt began programming but also took a strong interest in entrepreneurship, frequently reading the business plans his father brought home. As a Stanford economics major, he was determined to create the kind of business that either Jack Welch or his father would want to buy

Color me surprised.

Sure it's downward pressure on US wages without the benefits of having an employer, but for third worlders, $15 USD must be mana from heaven.

Calling it a "Software Sweatshop" is a little hyperbolic.

The sweatshop aspect likely has more to do with the monitoring and technological browbeating than the wages. Sweatshops are characterized by overbearing micromanagement of all workshop activities.


With $15 an hour working 50 hours a week in Brazil you’d be in the country’s top 5% earners. So yeah.

> but for third worlders, $15 USD must be mana from heaven.

For acceptable Indian developers this is normal wage. You get all the benefits of outsourcing from something like this as well as all the problems.

He's bought out many contracts through companies that were not doing so great. Over time the companies that he's servicing contracts for will understand the quality of code they are getting for their money and perhaps change their minds. I give it 10 years.

> but for third worlders, $15 USD must be mana from heaven.

This model is waning. Eastern Europeans now flock to East Asia in swathes, and are way way more aware of global job market.

This also creates a factor of negative selection: talents leave right after graduation, and remaining labour force is not suited to "evolve" and progress without a guiding force.

This model won't wane until the entire world is developed with strong workers rights everywhere. Until then, the demand for cheap labour will just shift to the next poor region.

How is any of that a bad thing?

If you can't utilize someone to their potential because of some political or social barrier, that's an absolute shame.

I never meant so, I state that things are turning progressively sour for companies like Crossover.

>>$15 USD must be mana from heaven.

It is definitely mana from heaven, but the barriers can be somewhat high depending on the contractor's locale:

1) they need to be able to successfully navigate their own country's tax and self-employment paperwork and regulations;

2) they need enough up-front capital to purchase powerful-enough equipment to do the job in the first place; and

3) they need telecom infrastructure that presumably supports high-speed internet (i.e. faster than dial-up).

I'd hope they're capable of that.

Lol, imagine as the farmers are in the fields, and merchants in the shops grinding away to make a few dollars a day. This remote dev is making a 10x multiple of their pay. Sweatshop? Ha.

Internet cafes in developing countries are abundant, and you might be surprised how fast the connectivity often is.

They cost a tiny fraction of $15/hour so I don't see how this is a capital-constrained job for anyone.

The theoretically necessary self-employment paperwork is not going to be a meaningful barrier to action in most developing countries.

If it were so simple and accessible why don't American citizens migrate to those countries to take advantage of the low cost of life?

I know at least some programmers who have moved to Third World countries. In Indonesia, for example, you can live like a prince for about $1000 a month. Then work remote for US based companies. Your North American resume and cultural knowledge allows you to still charge a decent rate for your skills. But your cost-of-living is minuscule. It’s a decent option for many young people to consider.

That is a super risky proposition. It is not so easy to just pack up shop and leave a country. You will have to leave behind most if not all your friends and family. Also, you need to have adequate savings to make that leap, which most people do not have.

They do. All the time. Traders move to Puerto Rico and programmers move to Thailand. It’s even better because you get the first $100k tax free as employee, or approx 14% off if self employed.

Do the programmers not like arroz con gandules? Or is it just an established trend?

Puerto Rico is attractive to US traders because if you live there for six months out of the year you pay zero capital gains tax. On the other hand programmers still have to pay income tax so are more likely to seek inexpensive tourist destinations.

I did this in Panama. They use the US dollar, but cost of living is not that low. Food actually cost more, with the exception of locally produced things. It can work out well. I did it tax free too, but it is a lot more complex for US citizens. Although I think you only have taxes on income above $100,000 a year outside of the country, but I'm not an accountant, so take that with some salt.

Many do

$15 an hour comes to around $30,000 a year. That's mana from heaven anywhere outside of the top 20 or so economies of the world

it's downward pressure on US wages without the benefits of having an employer, but for third worlders

Right, this was the deal offered to Western factory workers: you, your family and your friends will be tossed on the scrapheap when the factory that employed most of the town goes offshore, but some people you’ve never met 10,000 miles away will be slightly better off, and some other people you’ve never met will enjoy slightly cheaper consumer products.

And people wonder why those people vote as they do.

If your work can't be differentiated from someone elses, why should you command a higher wage?

When the West had an industrial culture, we could compete with inexpensive labor because we had superior skill concentration, logistics, and capital investment. If you're willing to pay a premium, do so. It was Consumer indifference that let it happen.

It didn't help that the US shifted from being a third-world, low cost labour center, to a first world economy.

US farmers - ~$9.50 USD a month ~1850's Euro labourer -~$652.44 USD a month ~1850's

Silver value in USD: https://commodityhq.com/education/a-brief-2000-year-history-...

References -

US Labour Rate(Farmers - page 6): https://www.nber.org/chapters/c2486.pdf

Europe Labour Rates (Labourer - pages 6): https://www.nuffield.ox.ac.uk/media/2150/allen-greatdiv.pdf

On the other hand, if by sheer chance you happened to be born in a low cost economy, why should you benefit from that at the expense of someone else? You didn’t earn it after all. Both scenarios are just accidents of birth, nothing more.

Everyone gets paid at a rate relative to their local cost of living, remember. Being “cheaper” offshore is merely an artefact of exchange rates and tariffs.

“Should” doesn’t matter. If I can use my vote to prevent my job from going to a more talented and more desperate person in Cameroon I’m going to do so, right vs. wrong be damned.

> If your work can't be differentiated from someone elses, why should you command a higher wage?

Because you're a human who's part of a society, not just a cog in a capitalist's machine. What you said makes sense, but only from a blinkered point of view that treats market forces as morality. You might as well turn it around and ask yourself why the person with skills from a poorer place shouldn't get the higher wage.

I do ask that...

Why is it inherently moral for me to get a certain benefit vs someone else, why would that change depending on where I am or where they are, where I'm from or where they are from?

I don't disagree. I do try to consider that human, and member of society angle.

I personally prefer working with people I can have a high level discussion with and they deliver their portion with best practices, good communication, baked in. That's valuable. I believe it makes your work distinct from someone without those skills.

If it were all anonymous and I can make no distinction, you're equally valuable. There are cases where people from poorer places should and do get the higher wage.

> You might as well turn it around and ask yourself why the person with skills from a poorer place shouldn't get the higher wage.

Why shouldn't that person get the higher wage? That person is also part of a society.

> Why shouldn't that person get the higher wage? That person is also part of a society.

Ideally, they should. The problem comes in when a capitalist plays a labor arbitrage game that causes economic damage to real people in his home area, just so he can pocket the difference in labor costs.

Questions like...

>>> If your work can't be differentiated from someone elses, why should you command a higher wage?

...are pretty much always asked from the perspective of a labor-buying capitalist looking to maximize her own profits, regardless of externalities. Those questions have an insidious pseudo-moral tone that holds up the capitalist's profit over other concerns, and that subtly paints a worker's desire to make a respectable local wage as selfish.

It's very rare to turn the question around (at least from a position of power) to challenge the capitalist's decision-making.

Does the person screening the code for backdoors get paid more than $15/hr?

The resemblance of this guy to the protagonist in “sorry to bother you” is almost too on the nose.. get ready for life worry free!

> has no qualms about Crossover’s tactics, including its WorkSmart productivity tracking tool, which Tryba calls “a Fitbit for how you work.”

If I were FitBit, I'd send a C&D letter over this.

It definitely made this Fitbit employee annoyed!

An aside - I'm really liking the new Charge 3.

The pervasive monitoring reminds me of the villain in Snowcrash.

Sure but where’s the failed pizza delivering samurai or the mafia-backed punk skateboarder ;-)

This article is as good an occasion as ever to talk about supply and demand. As a matter of basic economic and mathematical reality, we can't graduate increasing numbers of programmers from CS programs and vocational schools forever without eventually creating a glut. Nobody wants to hear that, but it's true. Yes, so far, the amount of work has been keeping pace with the labor force, but this trend can't continue forever. You can't build an entire economy out of software production: nature abhors a self-licking ice cream cone.

There's a lesson we can learn from the legal profession. Quite a few people got expensive law degrees thinking that they would quickly earn back the investment, but it turned out that 1) law has surprisingly shallow demand for low- and mid-tier legal skills, 2) law is able to automate much of the low- and mid-tier work, and 3) legal practitioner skill is real, obvious, and exists on a very broad continuum, 4) professional demand is not uniform across the skill continuum.

Sounds a lot like software, doesn't it?

The legal profession bifurcated [1] into completely separate low-paid and high-paid worlds. This "FAANG" thing people talk --- about how there's some qualitative (and quantitative) difference in employment experience between the "good" tech companies and the rest of the industry --- is this same bifurcation pattern ramping up in software.

It's especially unfortunate that in a "bubble" industry like software is (and like law was), it's the marginal participants who are the worst hit by the inevitable crash. Demand for software talent is strong (for the moment), so wages are high and rising. But the people who clump together at the high-end compensation mode --- the ones who are exceptionally good at writing software and who really enjoy the field --- are already in the industry.

A $1 increase in industry-wide average compensation won't, generally speaking, convince a star programmer to join. The person who joins due to that $1 increase is someone on the margin, someone who would really rather be doing something else with his or her life, but who's just barely convinced, by that $1 increase, to try programming. Is this the kind of person who's going to land in the high-compensation bucket? Occasionally, yes, but generally no.

So far, software demand has generally kept pace with available labor, but this situation can't persist indefinitely. What happens when it stops? There's going to be some moment at which the industry recognizes that salaries are too high. There might be some precipitating event --- e.g., the coming inevitable business cycle trough --- or the progress of automation might greatly increase productivity for low- and mid-tier tasks --- or the industry as a whole just might slowly start to ask itself, "what exactly am I paying for?"

In any case, when that event comes, expect more companies to turn into the kind of software shop you see in the likes of Trilogy, or some contract body shop, or Electronic Arts. When the developer bubble finally bursts, the whole industry will look like these places --- except at the very high end of the skill distribution, because the supply curve for high-skill programmers is much shallower than the supply curve for low- and mid-skill ones.

At a certain point --- maybe not today, but probably some day soon --- it'll be irresponsible to tell people at the margins of software skill or enthusiasm to enter the field, because such a person will be able to expect only low-paid work in bad conditions, forever, just like a marginal lawyer today. But timing the market doesn't work, so who knows when that day will be? It could be tomorrow.

[1] https://abovethelaw.com/2018/06/the-most-important-chart-in-...

Does this story remind anyone else of L. Bob Rife from Snow Crash?

When open this website, I get a pop-up to agree to data collection. My only other option is "more information". If I click on that, I get the option to reduce the data collection to "necessary cookies". Once I set my preferences, it presents me with an obviously fake "processing request" screen, with a percentage number slowly going up. I can, of course, cancel at any time. At the end it tells me that I changed my preferences but some "partners" could not recieve those changes because I'm using https.

I really hope the EU actually intends to prosecute those not in compliance with the GDPR.

> it presents me with an obviously fake "processing request" screen

You may argue about the (efficiency of the) implementation, but that processing screen isn't a fake; it sends out a large amount of HTTP requests to URLs like "cookie-policy?optout=1" and "optout" for various tracking parties. Those requests take exactly the amount of time the progress bar is indicating.

Don't lightheartedly call somebody or some party a liar before being sure of your case.

The point is that it is not GRPR-compliant. It must be explicit opt-in, not tracking be default, which you must then opt-out of.

Everyone may decide for themselves what 'the point' is, but I explicitly responded to the quote I included in my post.

I just reported them to the UK ICO.

They will if EU citizens report them.

Has nothing to do with citizenship, but residence.

Yeah. An enterprising ambulance-chasing lawyer could get temporary EU residency to get GDPR coverage, and cut some deals with whomever he cares to bully.

While an entertaining thought, in practice that would be ridiculous as that lawyer would then be subject to EU taxation which would negate any advantages for acquiring EU residence. That lawyer would then also be subject to US taxes as well since the US taxes worldwide income regardless of country of residence, while most EU countries tax income earned while a resident of that country. Despite tax treaties, some taxes, such as Social Charges in France, aren't covered by treaties, thus subjecting that lawyer to an entirely new world of pain in terms of taxes. Not to mention that if that lawyer were practicing law in the EU, he'd have to get credentialed in the EU or face arrest for the illegal practice of law.

You get to deduct your foreign taxes as a US citizen abroad. Otherwise no US citizen would ever live abroad.

Does it matter if the website doesn't have any physical presence in the EU?

It doesn't matter where you live or where the company is based... afaik, the determining factor is where the company stores data. In other words, if they have servers in the EU, they are bound by GDPR.


Basically, it covers companies with some legal entity in the EU.

As long as it serves content on EU territory, GDPR applies.

What is the sanction if you have no physical presence in Europe?

Absolutely nothing. They're not about to block some of the biggest sites around for failing to comply with GDPR. Can you imagine the backlash? No one wants a Great Firewall of the EU.

Anyone who thinks GDPR applies to companies operating entirely outside the EU is deluded at best.

No, this is completely incorrect.


How do I actually make a GDPR complaint? Like is there a .eu website with a form for it?

AFAICT you file it with the relevant authorities in your country.

For example, if you live in the UK, you should contact the Information Commissioner's Office (ICO) according to [0].

[0]: https://www.entrust.org.uk/privacy/privacy-and-data-protecti...

How could EU law apply to a US publication? Would US law apply to EU publications? Is a representative from the EU going to show up in New York and serve Forbes a summons? I am genuinely curious how a US publication with no legal domicile in the EU have any obligation to follow EU laws.

If a California resident goes to an EU insurance website, will that EU company have to comply with California insurance advertising laws?

I think that there is a lot of wishful thinking about GDPR and a lot of ignorance on how jurisdiction works, especially internationally.

GDPR has no jurisdiction over companies without an EU domicile or physical presence. And EU citizens aren’t protected unless they are actually resident in the EU.

Actually, I'm going to stand corrected.. While I stand behind the jurisdictional argument I've made per the Territorial Scope of GDPR (https://gdpr-info.eu/art-3-gdpr/) -- however, in this specific case, Forbes does, in fact have an EU operation -- many in fact, (https://www.forbes.cz) as an example.

However, the question might now be -- do visitors to the Czech site have to agree to the same conditions and tracking as do visitors to the US site. If they're doing the same shenanigans on their Czech site as they are in the US, then of course, they are potentially violating GDPR.

However, if the Czech site (as an EU example) IS following GDPR but the US site isn't, then there could be a strong case made that they aren't violating GDPR since the main Forbes site would clearly not be intended for EU consumption; GDPR, while applicable to the EU-side of the Forbes business, doesn't provide a blanket requirement for GDPR compliance across Forbes's non-EU properties.

As far as EU citizens vs. residents, that concept ought to be clear: an EU citizen doesn't have protection of EU laws when outside of the EU just as an American banking in France isn't protected by US banking laws. The passport of a complainant isn't relevant, but their physical location. An EU resident American who is visiting the US isn't protected by EU consumer protection laws for example, during a visit to the United States.

As far as EU citizens vs. residents, that concept ought to be clear: an EU citizen doesn't have protection of EU laws when outside of the EU just as an American banking in France isn't protected by US banking laws. The passport of a complainant isn't relevant, but their physical location.

Yes, that's a common point of confusion, but it's completely correct: the GDPR applies to people in the Union, not to EU citizens everywhere (for non-EU companies, that is - an EU company has to apply the same protections for every user in the world).

> Would US law apply to EU publications?

Yes. For example Bank in the EU (or at least in France) have to report to the US financial organization if a US citizen open a bank account here.

> How could EU law apply to a US publication?

Via business partners, treaties, subsidiaries, sister companies, and the restriction on the freedoms of individuals from those countries.

> Would US law apply to EU publications?

Yes, in exactly the same way. Whether one has to worry about it relates to the dependence of the two countries on each other and their relative military might.

> Is a representative from the EU going to show up in New York and serve Forbes a summons? I am genuinely curious how a US publication with no legal domicile in the EU have any obligation to follow EU laws.

Each relevant body in each EU state can act independently, and they would presumably serve them a warning in any European office first, but for a US only company they would likely employ a US legal firm to deliver the letter for them. However its unlikely to be a summons, more likely a request for information followed by the penalty that is going to be imposed - there will probably be some opportunity for mediation and it could be escalated to a court.

> If a California resident goes to an EU insurance website, will that EU company have to comply with California insurance advertising laws?

Depends on Californias laws, but presuming the site was intentionally serving Californians then yes, it should, and would, be at risk of penalties in California.

> I think that there is a lot of wishful thinking about GDPR and a lot of ignorance on how jurisdiction works, especially internationally.


> GDPR has no jurisdiction over companies without an EU domicile or physical presence. And EU citizens aren’t protected unless they are actually resident in the EU.

The bodies that enforce the GDPR can recover their penalties by engaging any of many different legal apparatus, where they deem it appropriate (which will be rarely, if ever, as they have to convince other internal organisations to back them). It is harder, but by no means impossible, to recover money from abroad or to stop money transacting with a foreign entity.

Anyone present in the EU is 'protected', residence is not required.


Forbes media have offices in Paris, Milan, and London. They regulary engage in both high value financial transactions and on the ground reporting in the EU. If they were prevented from operating inside the EU it would cause them severe operational issues, and their place as an authority in Western media would disappear overnight.

This smacks of fake news

Should be required reading for anyone pushing the “teach kids to kode” mantra in Western schools. Or the myth of the tech talent shortage.

I’m old enough to remember the late 90s when lots of “teach kids to kode” efforts were spun up and then torn down a few years later when the dottcom crash hit. The general public thought technology was going the way of textiles and all the gumption to teach coding evaporated overnight.

My high school went from having 3 jam-packed programming classes to a single AP class that barely had enrollment.

My father was a machinist, and I saw in high school that there was no future in that in the US and went into software, which at the time was a hot field. But it was clear to me once the Internet made outsourcing these kinds of tasks trivial that coding would become commoditized. (I actually also thought that basic software construction would be largely automated by now lol.) It occurred to me a while ago that "programming" in the traditional sense is more or less the "blue-collar job" of the 21st century. And these jobs will follow the route of the blue-collar jobs of the 20th century in the US.

It seems the only survivors will be MBAs and lawyers...

Nah, just speed through a few YouTube video series, pirate a couple of machine-learning textbooks, clone into the Deep Learning with Python repo, and market yourself as a data scientist.

Are people still doing menial tasks that can be automated by computers? Yes? Then there is a shortage of people who can code.

You wouldn't argue against people learning math just because there are billions of people who can add numbers at $15 / hour. The point of teaching kids to code is not to make them all professional software engineers but to give them basic skills to automate the boring stuff. If that makes a greater pool of people who can do machine learning or whatever the current shortage is, then those skills can be used to solve more problems than just targeting ads and playing zero sum trading games.

anyone pushing the “teach kids to kode” mantra in Western schools or the myth of the tech talent shortage wants this to be the case -

the opinionated well paid tech workers who have more hard skills than the managers are a political threat..

Could you expand more on this? I'm having a hard time picturing how the 'myth of the tech talent shortage' benefits the powers that be. Doesn't it cost them more?

It drives down wages by attracting a glut of workers to the industry, aids with lobbying for favourable immigration policies (e.g. indentured labour) and so on. It’s not just what we call tech either; this happens all across STEM.

It’s failing miserably at driving down salaries.

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