The coronavirus is an exogenous shock to the global economy, causing panic in the financial markets, a jobs apocalypse and an unprecedented crisis in health services. At the same time, the necessary safety measures are challenging the very nature of work and human sociality. Social distancing and lockdowns have been implemented around the world and in many countries, enforced by the state with a militaristic strictness. While Boris Johnson waxes Churchillian indulging in his “wartime” fantasy, the UK is facing a social catastrophe that goes beyond the economy. In the short term, there will be serious losses throughout many industries as many of their clients scale down or go bankrupt and we enter a recession. But in the long-term, we will see changes in the nature of work and human sociality that seem closer to the brave new worlds of science fiction than our pre-coronavirus reality. The tech giants are likely celebrating and the key to their success will be our quarantine. A different world will emerge as the economy recovers, a world where technology mediates a far greater proportion of our lives than any Silicon Valley ideologue could have dreamed was possible previously.
While profiting from a crisis is par for the capitalist course, the particular way that tech companies are benefiting from the pandemic has much broader social implications than simply paying dividends. While McLuhan’s Global Village has been a reality for some time now, he could not have anticipated the scale and scope of the technological deepening that is occurring. As Wayne Kurtzman, an analyst at tech research firm IDC has said, “this may have jump-started the market by seven years.” The imperative of the crisis to work from home and socially isolate “is a perfect opportunity for companies to become the digital businesses they have wanted to be,” Kurtzman added. This is ghoulish capitalist realism of the highest order. And yet this is a point we all must take very seriously – coronavirus is the shock that the tech sector needed to complete the silicon revolution.
To understand the implications of our new cybernetic ecology for work and society, we need to understand the political economy of connectivity. Throughout the late 1990s and 2000s, there were massive amounts of public and private investment in information and communications technology (ICT) infrastructure. After the financial crisis of 2007-’08, large-scale financial disruption pushed venture capital into new technologies, scaling up digital transformations and creating structural changes in the global ICT infrastructure to pave the way for mobile connectivity and mass datafication. According to Internet World Stats, internet connectivity has grown from 16 million or 0.4 % of the global population in December 1995 to 4.57 billion or 58.7% of the global population as of January 2020. As of 2018, 5.1 billion people (66 percent of population) had mobile connectivity and this is expected to increase to 5.7 billion (71 percent of population) by 2023. There were 3.7 billion 4g mobile connections in 2018.
Over the past decade or so, we have witnessed the so-called “rise of the intangible economy,” which refers to the rise of investment in assets like intellectual property rights, branding, software and data networks, which have different economic dynamics than traditional tangible investments. One of the most important intangible assets is data, which is now treated as capital in most large firms. The rise in the mass use of smart phones, digitally-mediated consumption and machine to machine communications via the ‘internet of things’ in production has allowed for datafication on an unprecedented scale. The sheer volume of data on machine and human activity is difficult to imagine. Growth in data normally follows what is known as Cooper’s law, in which traffic roughly doubles every 2.5 years, which means that the 33 zettabytes (trillion gigabytes) in 2018 will likely increase to an 132 zettabytes in 2023 and 528 zettabytes by 2028. However, it is important to note that this data is diverse and not all of it is valuable. Much of it is simply streaming video from platforms like Netflix and Youtube. Direct and triangulated data on worker and consumer behaviour from digitally connected firms is where the value lies. It is used for targeted marketing, but increasingly for training the growing number of machine-learning algorithms that power artificial intelligence applications across production and consumption.
While most companies still have no formal data valuation policies in place, data is typically valued as a combination of three things: (1) the asset value; (2) the activity value; and (3) the future value. As of 2018, the data broker industry was estimated to generate $200bn in annual revenue and is expanding. In Europe alone, the European Commission estimates that the data market (market of digital products and services) could be worth as much as €106.8bn by 2020. The three largest data brokers – Experian, Equifax and Transunion – each bring in over a billion dollars annually. This data has value because it can allow companies to anticipate shifts in markets, manipulate worker and consumer behaviour and be used for mass surveillance by technology firms and states alike.
The global coronavirus lockdown has shifted millions of people offices to working from home, a change that could be permanent. This shift has significantly increased internet traffic and digital mediation. According to security company Cloudflare, general traffic is up between 10 and 20 percent and peak traffic is up nearly 13% since early February in the US alone. Most of the increase in traffic comes from consumer video services with teleconferencing and gaming increasing 300% and 400% respectively. In the UK, BT’s chief technology and information officer Howard Watson, said there have been record amounts of traffic, peaking at 17.5 terabits per second with normal weekday traffic averaging around 4 to 5 terabits per second. Data usage is already up 30% for Vodafone’s 18 million customers and is likely to rise as the government’s strategy follows that of its European neighbours. We have no ownership and very minimal control through GDPR about what data is collected on our digital activity.
Many states don’t even own the infrastructure itself. The infrastructure of the internet consists of a backbone of undersea cables, national ICT network, and data storage – Data Centres, Edge Points of Presence (POPs), and Edge Nodes (see Google for an example). In the UK, the telecommunications network is owned by Openreach, which was established in 2006 and is a huge division of BT Group, or British Telecommunications PLC. As of 2019, Google owns 1.4% of submarine cables worldwide, as measured by length, and 8.5% if you include cables with shared ownership. The buying of cables is a broadening of the privatisation of local internet infrastructure that’s been occurring since Netflix took off. Most online activity (including Netflix) relies on some form of private data storage, most of it provided by Amazon Web Services.
Given the fact that lockdowns are in place in many countries and home-working is the new normal, it should come as no surprise that certain tech companies are set to benefit from this crisis. Shares in Zoom, a video conferencing platform, were up 74% this year, while the S&P 500 was down 21% in the biggest sell-off since the financial crisis of 2008. Their fourth quarter revenue totalled $188.3 million, up 78% year-over-year. The company added 2.22 million monthly active users as of the end of February 2020 more than in the entirety of 2019. But the Silicon Valley startup has yet to publish a transparency report detailing its data security practices, despite the attempts from groups like Access Now to compel them. Another vital platform for facilitating telecommuting (working from home) is Microsoft Teams. Teams is included in corporate subscriptions to Office 365 bundle and provides project management, workflow and video conferencing tools. Between March 11th and March 19th, Microsoft Teams users increased by 12 million – from 32 to 44 million up from 20 million in November. The data available to these companies about workflow processes, communication, and online behaviour will be extremely valuable.
There is a datafication imperative for organisations that entails the surveillance of people, places, processes, things, and relationships among them. The modern company aims to extract all data, from all sources (machine, worker and consumer alike), by any means possible (often circumventing laws). The operation of data analytic methods tends to be opaque or unintelligible to employees. The massive increase in digitally-mediated working and social activity has given tech companies an opportunity to capture data on workers’ behavioural and situated knowledge. Such data can reveal things about individuals that they themselves aren’t aware of. The capture of data on workflows, communication, emotional reactions undermines both workers’ control over their labour processes as well as consumer privacy. There are very limited social protections in this digital space and even less enforcement. This makes it difficult to secure the informed consent of the employee based on GDPR guidelines and even more difficult to leverage data as part of collective bargaining.
As Thomas Piketty recently noted, datafication and automation makes “the question of who controls the machines and owns the patents and the income flow associated with these properties becomes more and more important.” According to a report by the high-level expert group on the impact of the digital transformation on EU labour markets, workers and consumers data contributes unremunerated to “the stock of intangible capital that will at some point replace their manual or intellectual labour.”
The datafication and automation of everyday life allows capital to harness knowledge about humanity in ways that subordinate humanity to the logic of who controls the machine. It is imperative that we recognise this as a serious problem. We should not let the tech companies continue to capture our data and transform it into capital. We need to own or destroy the machines.