Welcome to the Data Wars. The ultimate battles to control your data will happen in your pocket, in your living room, in your bedroom, in your office and even your bathroom. Every move we make, every step we take creates an output of data. When do we step out of home every day? When do we buy our groceries? And more. Amazon, Facebook, Google, Uber and other major tech businesses are eager to control and use your data output. Imagine being able to cover your customer’s needs right there when they have that need? This is marketers heaven.
Let’s start from the beginning.
The Predictive Economy
Predictability is an essential element of modern capitalism. The ability of businesses to predict the user’s tastes, behaviors and purchasing patterns allows the economies of scale to function. Brands aren’t able to change the formula and details of their product in an unpredictable fashion. The cost of adapting the infrastructure and supply chain to ever-changing consumer demand would be infinitely high. Therefore, businesses in a modern capitalist environment need the consumers to have stable reliable consumption patterns, a condition that ensures the sizeable investments in manufacturing or infrastructure are financially sound.
Branding and marketing are effective tools for creating user behaviors that enforce your business position and consumption patterns. Yet, with the advent of digital technologies, the core of predictability has become Data. The smartphone technologies allow businesses to capture 10x data thanks to us being gullible users. We download and install apps without blinking, therefore creating pathways for entrepreneurs to capture data and monetize it. GPS technology, among other features that our phones carry, allow apps to track in real time our moves, purchases, habits and what not. It is the case that Facebook knows more about people’s lives in Africa than some of the local governments do.
The more we develop the AI and VR systems, the more we can enter into a predictive economy. Embedding technologies in a seamless way to people’s life allows unprecedented access to data. The dreams of Socialist public planning come true thanks to Capitalist technology. An example: Amazon Dash. If you know when the user will need dishwasher soap, you can stock it in advance and create further efficiency in your system.
Over time, the business operator can analyze the pattern of consumption and generate logistics, inventory and operations optimizations. When the user actually creates an order, the retailer already knows the order is coming. Thus, our habits and attitudes become monetized and the data trading companies thrive. This could be defined as predictive e-commerce: Predictive e-commerce applies AI technologies to process user data and anticipate the customer’s needs. And you know who is king in the world of e-commerce…Amazon.
Amazon’s Masterstroke
Amazon has released a masterstroke called Alexa. Alexa is an AI-powered assistant that can perform multiple tasks for you. According to latest data, it has learned over 10.000 tasks. From ordering food, scheduling meetings or ordering an Uber ride. In what might seem an innocuous move, Amazon has displaced the traditional text-based search and introduced a more advanced and capable search engine: a über-smart fast-learning voice-controlled virtual assistant. All of a sudden, Amazon has unlocked the holy grail of data while empowering users to overcome the barriers of text and hardware. No more desktops, no more mobile phones, no more tipying.
The underlying play is the Data War. Who is the ultimate owner of the user’s attention and the user’s data output? Facebook and its accolades Instagram and Whatsapp have been effective at working the attention arbitrage. Amazon was left behind because, in overall, it’s still an e-commerce platform. None of Amazon’s hardware products, excluding the Kindle, have found much success until the recent Amazon Echo. The Amazon Echo, featuring Alexa as its software, turns the table by allowing Amazon to enter the attention arbitrage play. Now it can receive the user’s attention in their own living rooms and bedrooms. It captures the most relevant and minimal data: What do you eat? What do you listen to? When do you eat, sleep, listen to music, wake up…? What’s your schedule like? Where do you ride to with Uber? And more.
Google is the new Microsoft
Who could be the ultimate killer of Google? Amazon. Google has tried to fight back Amazon by releasing Google Home. A capable AI-based hardware that is directly competing against Amazon Echo. Despite its best efforts, is Google becoming the Microsoft of our era? Android seems to be an open-source version of what once was the all-mighty Microsoft Windows. The growth of search engines has stagnated for the past years.
Waynmo’s lawsuits against Uber and the talent exodus makes you wonder whether Google will be able to create new core businesses outside their traditional area. Alphabet has yet to generate a meaningful income from their non-Google business units, while Amazon has successfully branched out into the cloud business and more. Amazon Web Services is so profitable for Jeff Bezos that it allows him to keep fueling the growth-focused Amazon juggernaut without hindering the stock’s price.
Facebook dominates social discovery by unleashing features like the recently released Jobs tab. It allows human beings to discover and find each other while allowing brands to sell directly to Facebook’s growing customer base. It is becoming a virtual agora that steps on the shoes of LinkedIn, Google and Amazon. Google used to dominate content discovery and product discovery. Right now, Facebook and Amazon are creating powerful tools to enhance product, content and social discovery.
Google hasn’t been able to successfully set foot in the social space. Google+ is a failure. It seems Google is unable to stray away from its core business: the Search Engine and the accompanying Google Adwords. Adwords remains a text-based advertising engine while advertising on Facebook, Snapchat or Instagram allows an audiovisual experience more meaningful to people, which in turn enhances CTRs. Uber is being said to be considering introducing Ads to their product. That would create a more efficient solution compared to Adwords: advertise in the right moment, in the right place.
Tech is your lifelong partner
Silicon Valley techies are your new lifelong partners. Whether you are in Europe, Africa, India or the USA. In Africa, the Data Wars are giving birth to dubious proposals like Internet.org, an effective tool for Facebook to control users data and Internet access, why is which it was kicked out of India. Technology can also be a tool for social development and the magic of Chinese e-commerce is an example.
Millions of Chinese have taken advantage of Alibaba and WeChat’s platforms to build SMEs. At the same time, the Chinese Communist Party is pushing for the establishment of an online data processing system that can assign a score to citizens based on each citizen’s online footprint. This score will be then applied to manage the issuing of travel permits or loans, among others. It’s perfect control.
Twitter is becoming the new MySpace. Google might become the new Microsoft. At some point, Facebook might become commoditized as well. New technologies, new tools will rise and the old ones perish. That’s the beauty of it. This is the reason why it’s difficult to pick an ultimate winner of the Data Wars. Maybe the government? For the time being, Amazon and Facebook seem to be leading the battles.
As we embed new technologies to our lives, our need to micromanage our lives disappear. The Data Wars may bring less privacy and more invasive technologies to our lives. Yet, most of us seem satisfied with the trade-off. We don’t have to think about transportation, accommodation or grocery shopping as much as we used to. Apps and tech businesses allow us to be more productive with our time and that is why the privacy advocates might be losing the battle. Time is the precious trick to all apps and techie things. Time is the currency of life, therefore anything that allows us to waste less time, it’s giving life back to us. My hope is that technology will do that for us.
It is a profoundly erroneous truism, repeated by all copy-books and by eminent people when they are making speeches, that we should cultivate the habit of thinking of what we are doing. The precise opposite is the case. Civilization advances by extending the number of important operations which we can perform without thinking about them. Operations of thought are like cavalry charges in a battle — they are strictly limited in number, they require fresh horses, and must only be made at decisive moments. Alfred North Whitehead