Conflicts of interest in tech

Sunday, May 03, 2009 by Dave Winer.

It's Jay's week for the source of inspiration, so I'm bringing a different topic to our weekly potluck of speculation about Rebooting The News.  

Obviously we're going to talk about Twitter's suggested users list.  

Last week: 1. Jay was put on the list, 2. Got the surge in new followers, then 3. Asked to be taken off, and 4. Was taken off.  

You can see the effect on his follower count in this graph. I took a screen shot because it will scroll off over time. It's stunning. Very clearly, being on the SUL has a dramatic effect on your count. 

We've talked about conflicts of interest among journalists, but haven't talked about the same thing for tech people. Mike Arrington tried to ignite a scandal around me over something that happened at UserLand in 2002, when I was on the vendor side (and a blogger, which is part of what blogging was and is about). I responded, not with a blanket dismissal such as "Vendors don't have conflicts of interest" -- because I believe they do. They can get themselves out of conflict by divesting and/or disclosing. I guess most people felt that what I did wasn't so bad, because the hatefest never came about, and Mike looked bad, as if he was trying to deflect attention away from an article I had written the day before, about the conflicts that arise from accepting a large gift from a vendor you cover, without disclosing it when you write about them.  

Today we'll find out, from Jay, what it means for a professor of journalism, and for an ordinary human being to receive such a gift.  

In the course of the public discussion last week, I said that if I were put on the Suggested Users List, I would ask to be removed, and if the request wasn't honored, I would delete the account. I don't want the distortion it causes. I don't see Twitter as an advertising medium, I am not a journalist and could ethically receive a gift from a vendor, even so I would refuse it. I don't believe that Twitter should be getting in the middle of the relationship between users of its service. That's sacred territory. This is a matter of net neutrality. Could someone like Mike, who writes passionately about net neutrality in his TechCrunch column, possibly not see this? 

Anyway, all this is a preamble for where I want to take this, because while these ethical issues are central to the trust between writers and readers, the economics of the web are goverened by another conflict, one that is very rarely talked about. I'd like to get it out there. 

Here's the story... 

1. Google makes a lot of money from advertising. 

2. If one were to define advertising, it seems to me you'd have to include the idea of intrusion. An ad intrudes on your experience, it's a sidebar, it's something you wouldn't think of on your own. If you're already humming my jingle, I don't have to pay someone to play it for you. Or so it seems.  

3. As search gets better, it will obviate the need for intrusion. A perfectly targeted ad at some point stops being intrusive and starts becoming information. If you get me the commercial fact that I need at precisely the moment I need it, you don't have to impose on me, I will welcome that.  

4. Google is in the business of getting you the exact fact or link that you're looking for as quickly as possible. 

5. Its advertisers pay money to get you their link before you find one in the search results. 

6. But if they're the same link, maybe the advertiser will stop paying? Or if the customer believes that a better link is in the first search results rather than on page 5 or not there at all? The customer, perfectly happy, never has a reason to go where the ads direct them. 

Now, I know that there are other forms of advertising, ones that program you to think a certain way, but you don't see those kinds of ads on Google. Maybe they'll have to change, because as the search engine gets better and better, which it should (right?) the ads will play less of a role. 

We know that companies don't always play fair. 

There was the case of GM sabotaging the public transit system in Los Angeles. 

A lot of companies profited from the war in Iraq. If you don't believe they helped get that war going, I have a nice bridge to sell you. Special price. Just for you.  

Closer to home, the recent price drop in laptops, the netbooks, show that there was some kind of price fixing going on before that, a collusion between the vendors to keep prices high. So we know that the tech industry is capable of the same dirty economics as other industries. 

When Google has to cut its own revenue stream by enhancing search, will they do it? So far the competition has made this easy for them, but just this week Wolfram Research has been wooing the analysts with their new way to do search. Maybe this isn't the challenger that will push Google to seriously upgrade search, if not, surely at some point it will happen. 

I don't know how you feel, but it seems to me that search has been pretty constant for the last few years. It's been a long time since the quantum improvement that Google offered over Infoseek, Alta Vista, et al.