“The internet destroyed the middle class”

“The internet destroyed the middle class,” says Jaron Lanier in the prologue to his new book, Who Owns the Future?. “At the height of its power, the photography company Kodak employed more than 140,000 people and was worth $28bn. They even invented the first digital camera. But today Kodak is bankrupt, and the new face of digital photography has become Instagram. When Instagram was sold to Facebook for a billion dollars in 2012, it employed only 13 people. Where did all those jobs disappear? And what happened to the wealth that all those middle-class jobs created?”

With his waist-length dreadlocks, watery blue eyes and protruding abdomen, Lanier does not look like your stereotypical media academic, but his credentials more than make up for the shortfall. Lanier was inventing virtual reality software in the 1980s when most of us were still baffled by it in science-fiction novels. He is one of a handful of minds that helped shape the internet, back when words like ‘wiki’, ‘crowdsourcing’ and ‘social media’ were not part of our everyday lexicon.

Many people call Lanier a visionary. He set up shop in Palo Alto in the mid-80s, long before it became a destination postcode for tech visionaries and aspirants, and was building virtual reality machines before Google had even imagined their Glasses. Lanier has been selling virtual reality goggles and gloves since 1985. In fact, Lanier has sold tech companies to Google – and to Microsoft as well.

The wisdom of the crowd
In the 90s, Lanier was talking about “the wisdom of the crowd” and how “information wants to be free”. He was laying the foundations for Web 2.0 when the majority of pages were still static one-way communication systems. But just as Wikipedia was preparing its launch, Lanier started to reconsider the benefits of an open source internet.

Today, he is more of a defector than a contributor – even if he still holds a research position at Microsoft. Jim McClellan, Principal Lecturer in Journalism at the University of Westminster, says: “He’s different to traditional net critics in that he’s not an academic or a journalist trying to sell a book or score a book deal. He has a technical and programming background, and a creative arts background – so his ideas are informed by practical knowledge and experience.”

“For the last 20 years, I have found myself on the inside of a revolution, but on the outside of its resplendent dogma,” wrote Lanier in his now-iconic One-Half of a Manifesto, published by Wired in 2000. “Now that the revolution has not only hit the mainstream, but bludgeoned it into submission by taking over the economy, it’s probably time for me to cry out my dissent more loudly than I have before.

“I sometimes call it ‘cybernetic totalism’. It has the potential to transform human experience more powerfully than any prior ideology, religion or political system ever has, partly because it can be so pleasing to the mind, at least initially, but mostly because it gets a free ride on the overwhelmingly powerful technologies that happen to be created by people who are, to a large degree, true believers.”

The crux of Lanier’s point is similar to some of the arguments made when industrialisation came along: technology is killing jobs and growth. He is also critical of how the ‘crowdsourcing’ model is taking power away from people by making their information – and work – free, rather than actually including them in the model.

Lanier draws on the case of Google Translate as an example of how a huge corporation is monetising the crowd. It might seem like a magic tool to consumers, who don’t always wonder where the information comes from. Lanier says: “There’s another way to look at it, which is the technically true way: you gather a ton of information from real live translators who have translated phrases, just an enormous body, and then when your example comes in, you search through that to find similar passages and you create a collage of previous translations.” The original translators are not being compensated for all the work, he argues, comparing the operation to that of social media groups like Facebook, which monetise people’s private information and sell it back to them as advertising.

“Lanier isn’t the first person to say that free online services come with a cost – a cost we’re only just beginning to get our heads round,” says McClellan. “He’s not the first person to say that new media seems to be concentrating power and money in the hands of a small techno-elite. What he does seem to be trying to do is turn these observations into a larger political and economic critique, one that’s trying to reach a more general public.”

Counterculture icon
In person, Lanier is less subversive than in writing. In his many talks and public appearances, he is always quick to remind people that he “love[s] Google and Microsoft. I’ve sold companies to them”, before going on to question and undermine everything the two companies stand for.

Lanier has sought to distance himself from the industry, instead painting himself as a defector: an outsider with inside information. He describes himself as a musician and collects antique woodwind instruments. Despite his unconventional appearance and incendiary discourse, Lanier has emerged as something of a media darling.

McCellan says: “He looks a bit different to the average 21st century computer guy; he’s got the dreadlocks and the old school tie dye t shirts, and he has practical experience, he’s programmed, he’s a musician, he hangs out with creative types and programmers, so his ideas come from experience. The media likes that; they’re always a bit suspicious of academics. Lanier obviously isn’t on the tenure track, so journalists like that.”

Lanier’s message is compelling; he has predicted trends accurately on a number of occasions, including talking about privacy and surveillance before we knew the NSA and Wikileaks were issues. But over the years his discourse has focused primarily on the economic impact the widespread use of the internet and online technology has had on the world. And since 2007 his message has had greater resonance.

“There was this fascination with the idea of the informal economy about ten years ago,” Lanier told Salon earlier in the year. “Stewart Brand was talking about how brilliant it is that people get by in slums on an informal economy. He’s a friend so I don’t want to rag on him too much. But he was talking about how wonderful it is to live in an informal economy and how beautiful trust is and all that.

“And you know, that’s all kind of true when you’re young and if you’re not sick, but if you look at the infant mortality rate and the life expectancy and the education of the people who live in those slums, you really see what the benefit of the formal economy is if you’re a person in the West, in the developed world.

“And then, meanwhile, this loss, or this shift in the line from what’s formal to what’s informal, doesn’t mean that we’re abandoning what’s formal. I mean, if it was uniform, and we were all entering a socialist utopia or something, that would be one thing, but the formal benefits are accruing at this fantastic rate, at this global record rate to the people who own the biggest computer that’s connecting all the people.”

The majority of Lanier’s work has used the online music industry as a metonym for the wider online economy. It was his interest in music and his creative spirit that made him turn his back on the open source, free information model. He told Smithsonian: “I’d had a career as a professional musician and what I started to see is that once we made information free, it wasn’t that we consigned all the big stars to the bread lines.

“Instead, it was the middle-class people who were consigned to the bread lines. And that was a very large body of people. And all of a sudden there was this weekly ritual, sometimes even daily: ‘Oh, we need to organise a benefit because so and so who’d been a manager of this big studio that closed its doors has cancer and doesn’t have insurance. We need to raise money so he can have his operation.’ And I realised this was a hopeless, stupid design of society and that it was our fault. It really hit on a personal level – this isn’t working. And I think you can draw an analogy to what happened with communism, where at some point you just have to say there’s too much wrong with these experiments.”

Though Lanier is a huge hit with the media and has garnered a large following, not everyone is buying it. Mike Masnick, founder of Techdirt, is one of Lanier’s most vocal critics. He suggests Lanier’s theories are just as wrong as those that dismissed industrialisation as a passing trend. Writing in Techdirty about Lanier’s new book, Who Owns the Future?, he said: “Lanier’s predictions remind me very much of David Ricardo, in particular. Despite the evidence of new wealth creation from industrialisation, Ricardo dismissed it all as a passing fad, and rather was sure that we were in a complete death spiral due to diminishing returns to land.

“Ricardo’s main problem was that he really only focused on one variable in the market, and more or less refused to look at the market ecosystem as a whole. With Lanier, we see something similar, in that he extrapolates out the amount that people pay for music, and assumes that forever will it go down and that this spiral downward will have ripple effects throughout all of society. The problem is, as with Ricardo, the basis of nearly everything he states is not true.”

That is not to say there is no value in anything Lanier says. He is the embodiment of counterculture these days, and despite being active on the internet circuit, he is not on Twitter and has only a primitive-looking website. He does seem to practice what he preaches – being on Microsoft’s payroll aside.

It is always important to be critical of dominating systems in order to improve them in the future. Being able to recognise issues with ubiquitous products such as Facebook and Google is important, particularly when it affects so many people’s lives. On the other hand, it is naïve to dismiss their business practices outright when multimedia and tech are such an ingrained part of modern life. Lanier does not paint a pretty picture –  he may not be spot-on in all accounts – but when he does get it right, it’s certainly ominous.