Brad Feld Reviews The Lights in the Tunnel_2 pot

THE LIGHTS IN THE TUNNEL / 72 CopyrightedMaterial–Paperback/Kindle available @ Amazon chess moves, then why can it not also iterate through every known legal argument since the days when Cicero heldforthintheRomanForum?Wouldthisbea“lesser” formoflegalcreativity?Perhapsitwould.Butwouldthat mattertoourlawyer’semployer? Althoughthepracticalapplicationsofartificialintelli- gencehavesofaremphasizedbruteforcesolutions,itisby nomeanstruethatthisistheonlyapproachbeingtakenin thefield.Averyimportantareaofstudyrevolvesaround theideaofneuralnets,whichareaspecialtypeofcomputer thatisbuiltuponamodelofthehumanbrain.Neuralnets are currently being used in areas such as visual pattern recognition. In the future,we canprobablyexpect some importantadvancesinthisarea,especiallyastheengineers whodesignneuralnetswork morecloselywithscientists whoareuncoveringthesecretsofhowourbrainswork. Onethingthatprobablyjumpsoutatyouaswespeak oflawyersandradiologistsisthatthesepeoplemakealot of money. The average radiologist in the United States makesover$300,000.Infact,wecanreasonablysaythat software jobs (or knowledge worker jobs) are typically highpayingjobs.Thiscreatesaverystrongincentivefor businessestooffshoreand,whenpossible,automatethese jobs.Anotherpointwecanmakeisthatthereisreallyno relationshipbetweenhowmuchtrainingisrequiredfora humanbeing,andhowdifficultitistoautomatethejob. Tobecomealawyeroraradiologistrequiresbothcollege and graduate degrees,butthiswill nothold off automa- tion. It isa relatively simple matter to program accumu- Acceleration / 73 CopyrightedMaterial–Paperback/Kindle available @ Amazon latedknowledgeintoanalgorithmorenteritintoadata- base. Forknowledgeworkers,thereisreallyadoubledose ofbadnews.Notonlyaretheirjobspotentiallyeasierto automate thanother job typesbecause no investment in mechanical equipment is required; but also, the financial incentiveforgettingridofthe jobissignificantlyhigher. Asaresult,wecanexpectthat,inthefuture,automation willfallheavilyonknowledgeworkersandinparticularon highlypaidworkers.Incaseswheretechnologyisnotyet sufficient to automate the job, offshoring is likely to be pursuedasainterimsolution. Given this reality, it may be that the simulation we performedinChapter1wasactuallysomewhatconserva- tive.Lookbackatthetablelistingtraditionaljobsonpage 59. Veryfew of thesepeopleare knowledgeworkers. In our simulation, we assumed that automation would fall evenlyonsomesignificantpercentageoftheaveragelights inthetunnel.Wenowsee,however,thatautomationmay, in fact, arrive in a relatively “top heavy” pattern.It may wellbethatagreatmanyofthebrighterlightsinourtun- nelwillbeamongthefirstimpacted. Whatdoesthismeanforabusinessthatoffersprod- ucts and services in the mass market? Clearly, it implies thatautomationmaybepoisedtosomedayeliminatenot justuntoldmillionsofyourpotentialcustomers—itislike- lytohithardatyourbestcustomers. THE LIGHTS IN THE TUNNEL / 74 CopyrightedMaterial–Paperback/Kindle available @ Amazon Automation, Offshoring and Small Business Wetendtothinkofautomationandoffshoringasprimari- lyimpactingjobsinlargecorporations.Afterall,ittakesa substantial investment to set up a relationship with an overseasoutsourcingfirmorbringinspecializedautoma- tionequipmentorsoftware.In thenearfuture,however, bothofthesepracticesarelikelytobecomeincreasingac- cessibleandinexpensiveforeventhesmallestbusinesses. Thereisasignificanttrendtowardbreakingjobsinto smallerpiecesorspecifictasks—whichcanthenbeeither automatedoroffshored.Thiscapabilityisincreasinglybe- ing offered to small businesses either as pre-packaged softwareorthrougheasytouseonlineinterfacesoverthe Internet.Taxpreparationisoneareawherethisapproach is already widespread. Instead of making a large invest- ment in sophisticated automation software, a small busi- nessownerormanagerwillbeabletovisitawebsiteand then rent access tothe softwareon either a per-houror per-taskbasis.Ithinkitisverypossiblethatthesamewill happen with task-specific offshoring. Competition be- tweenserviceproviderswillquicklyproducelowerprices, easiertouseonlineinterfaces,andawidervarietyofser- vices. Theresultwillberapidpenetrationofthesepractices intobusinessesofallsizes.Aswesawwiththeradiologist and the lawyer, once significant portions of jobs can be automated, the number of workers employed will imme- diatelybegintofall.TheU.S.SmallBusinessAdministra- tion estimates that businesses with fewer than 500 em- ployees have generated from 60-80 percent of all job Acceleration / 75 CopyrightedMaterial–Paperback/Kindle available @ Amazon growth over the past decade. 25  As it becomes easierand cheaper for business owners to employ automation and offshoring,wemaywellfindthatthesepracticeswillbe- comeasignificantdragonAmerica’sprimaryjobcreation engine. “Hardware” Jobs and Robotics A“hardware”jobisajobthatrequiressomeinvestmentin mechanicalorrobotictechnologiesinorderforthejobto be automated. The automation of hardware jobs started long before the computer revolution. Machines used on assemblylines, farm equipment, and heavyearthmoving equipmentarealltechnologiesthathavedisplacedmillions of workers in the past. As history has shown, repetitive motion manufacturing jobs are among the easiest to au- tomate. In fact, as I mentioned, this is how the Luddite movementgotstartedbackin1811.However,themerger of mechanics and computer technology into the field of robotics will almost certainly impact an unprecedented number and types of jobs. Whether a specific hardware job isdifficultoreasytoautomate reallydepends onthe combinationofskillsandmanualdexterityrequired. Foranexampleofajobthatisverydifficulttoauto- mate, let’s consider an auto mechanic. A mechanic ob- viouslyrequiresagreatdealofhand-eyecoordination.He or she has to work on thousands of different parts in a varietyofdifferentengines,ofteninhighlyvariedstatesof repair.Inotherwords,arobotmechanicwouldfacemany visual recognition and manipulation problems similar to theoneswediscussedearlierwiththerobothousekeeper. THE LIGHTS IN THE TUNNEL / 76 CopyrightedMaterial–Paperback/Kindle available @ Amazon In addition, the robot mechanic would require a much higherdegreeofproblemsolvingskillthanthehousekee- per. In fact, this diagnostic skill it not something that couldbesolvedwithsoftwarealonebecauseitextendsto nearlyallthehumansenses.Amechanicmaylistentothe soundanenginemakesorevendiagnoseaproblembased onaspecificsmell. As things stand, we can say that becoming an auto mechanicisprobablyaprettysafechoiceforthetimebe- ing. But, as wesaid with the housekeeper,that doesnot imply the job will be safe forever. Advances in robotic technology will continue relentlessly until many of these problems are solved. However, an even more important factorislikelytobechangesmadetothecarsthemechan- ic is working on. Advancing technology has already im- pactedthewaymechanicswork;computerizeddiagnostic toolsarenowusedtoreadfaultcodesprovidedbymicro- processors embedded in the engine. We can expect that thistrendwillcontinue,andthat,atsomepointinthefu- ture,carsmaywellbedesignedspecificallytobeworked onbyroboticmechanics. Atruckdriverisanotherexampleofajobthatislike- lytobeprotectedforthetimebeing,but,inthelongrun, the reason will probably not be so much technology as socialacceptance.Themilitaryisalreadymakingsubstan- tialinvestmentsinautomatedtrucksthatcouldbeusedon thebattlefield.Thesecouldbecompletelyautonomous,or theymightbeprogrammedtosimplyfollowaleadtruck. Similarly,manycarmanufacturerswillsoonbedeploying collisionavoidancetechnologyincars.Thesesystemswill Acceleration / 77 CopyrightedMaterial–Paperback/Kindle available @ Amazon help drivers avoid mistakes that might lead to accidents; howeverovertimetheycouldevolveintotechnologyca- pableofdrivingthecarautonomously—justasjetairliners nowroutinelyflyandlandwithoutassistance. While the technology forautomated carsand trucks may arrive, it is somewhat difficult to imagine thatmost peoplewouldbeeagertosharetheroadwith50-tondri- verless trucks. A second important issue would likely be thepoweroftheTeamstersunion.Onceagain,however,I have to givemystandard disclaimer: this doesnot mean truckdrivingjobswillalwaysbeprotected. The job types that are likely to be threatened fairly soon byadvancesinroboticsare the jobs thatfit some- wherebetweentheautomechanicandtherepetitivemo- tion assembly line worker. As an example, consider the shelfstockerina supermarket or chain retailstore. This jobrequiresmoreflexibilitythanworkingonanassembly line,butstillfallsfarshortofwhattheautomechanicfac- es. Thelayoutofasupermarketisstandardizedandcould easilybeprogrammedintoacomputer.Theaislesarewide andthefloorsaresmooth;idealterritoryforanindustrial robot.Everyitemhasaspecificplaceontheshelves.Bar codesmakeitasimplemattertoidentifyitems,andspecial location markers could be placed on the shelves: a shelf stocking robot faces few of the visual recognition issues that challenged our housekeeping or auto mechanic ro- bots.Designinga robot that couldmoveinventoryfrom the stock room and place it on shelves is certainly well withintherealmofpossibilityinthenottoodistantfuture. THE LIGHTS IN THE TUNNEL / 78 CopyrightedMaterial–Paperback/Kindle available @ Amazon Needless to say, if a robot can be designed to stock shelves, then it can also be made to unload trucks and movematerialofalltypes. Skepticalthatrobotsmightsomedaybesteppinginto thesejobs?Considerthatasfarbackas2005,CNETNews Blogpublishedanarticleentitled“WhysoNervousabout robots, Wal-Mart?” 26 Thearticlepointedout thatreports hadsurfacedaboutWal-Marttestinginventory-takingro- bots.Thesewouldberobotsprogrammedtonavigatethe aislesatnightandautomaticallytakeacompletestorein- ventory. When the CNET reporter contacted Wal-Mart management, he received anunusually abrupt denialthat Wal-Martwasconsideringusingrobotsinanyway. WecantakeWal-Mart’smanagementatitswordand assumethatit,infact,hasnoplanstouserobots.Inthe long run, however, that won’t matter. At some point, if oneofWal-Mart’scompetitorstriestogainanadvantage by employing robots, then Wal-Mart and every other competingbusinesswillreallyhavenochoicebuttofol- lowsuit.ThepointofthisisnottovilifyWal-Martorany otherbusinessthatmightsomedaychoosetoemployau- tomation.Wehavetoacknowledgethat,inafreemarket economy,everybusinesshastorespondtoitscompetitive environment and employ the best available technologies andprocesses.Ifitdoesnotdoso,itwillnotsurvive. Historyhasshownthatjobautomationveryoftenin- volves pushing a significant portion of the job onto the customer.Automationinthecustomerserviceareaisreal- lyself-service.ThishasbeenthecasewithATMs,automated checkoutaislesandevenself-servegaspumps.In there- Acceleration / 79 CopyrightedMaterial–Paperback/Kindle available @ Amazon cently opened Future Store 27  near Düsseldorf, Germany, in-storeretailsalesandcustomerassistanceisbeingauto- matedviaacell-phoneinterface.Shoppersareabletoget realtimeassistance,whileshopping,throughtheirmobile phones.Theycanalsoscanbarcodesastheyshopand,in thenearfuture,willbeabletopayfortheirpurchasesdi- rectly through their phones—presumably avoiding the checkoutislealtogether. Thespecterofnearfullyautomatedsupermarketsand chainretailstoresiscauseforgenuineconcern.Theseare nowthejobsoflastresort.Thesearethejobsthatworkers displacedfromotherindustriestakebecausethereisnoth- ingbetteravailable.Lookbackatthetableonpage59.We havealreadymentionedthat3.5millioncashiersarepoten- tiallyatrisk.Thetableshowsanother4millionretailsales- personsand2.3millionlaborersandfreight,stockandma- terialmovers,aswellas1.7millionstockclerksandorder fillers.Whatnewjobscouldwepossiblyfindforallthese people? Readanyarticleinthepopularpressaboutthefieldof roboticsanditspotentialfutureimplications,andyouwill almostinvariablyfindasentencepointingoutthat“inthe future, robots will be used to perform tasks which are dangerous for people, or jobs which people don’t really want.” That is surely true, but it implies the somewhat wistful assumptionthatrobots won’t beused injobs that peopledowant.Thatisobviouslyasillyassumption.Ro- bots,andotherformsofautomation,willbeusedinstead THE LIGHTS IN THE TUNNEL / 80 CopyrightedMaterial–Paperback/Kindle available @ Amazon ofpeopleassoonitbecomescosteffectiveandprofitable forbusinessestodoso. *  “Interface” Jobs AthirdtypeofjobiswhatIcallan“interface”job.The people who hold these jobs, toalarge extent, fill inthe crackswhichcurrentlyexist betweenvariousinformation formats and technologies. As an example, consider what happenswhenyouapplyforahomemortgageloan.Ifyou workwithanindependentmortgageagent,heorshewill probablygiveyouapaperapplicationtofillout.Next,you willneedtoretrieveandmakecopiesofyoursupporting documentation: pay stubs, tax returns, bank statements, insurancedocuments,etc. Allofthis documentationwillbeonpaperoritwill befaxedtoyou.Apropertyappraisalwillbedone,andthe reportwillbeforwardedtotheloanagent.Oncetheloan agentcollectseverythingtogether,heorshewillprobably faxit all to thebank, wherealoanofficer will review it. Ultimately,numberssuchasyoursalary,creditrating,and the equity to loan ratio will be plugged into a computer programandtheloanwilleitherbeapprovedordenied. Clearly, the bulk of the labor associated with this process is in collecting, copying, collating and faxing in- formation.Theintellectualportionofthejob—eitherap- provingordenyingtheloan—isprobablyalreadyessential- lyhandledbyacomputer.Throughouttheeconomy,there   * Formoreonroboticsanditspotentialimpactonemploymentand on society, see Marshall Brain’s “Robotic Nation” blog at http://roboticnation.blogspot.com. Acceleration / 81 CopyrightedMaterial–Paperback/Kindle available @ Amazon areprobablythousandsofjobsforclerksandofficework- ersthatcontinuetoexistbecauseofthisclunkyinterface betweenwhatexistsonpaperandwhatneedstobeina computer. Clearly,wecannotexpectthatthisstateofaffairswill continueforever.Financialstatementsarealreadyavailable online. Standard data formats are making it increasingly easy for computers to talk directly to one another. The “XML” standard is a very popular format that is already widely used to move data between different businesses overtheInternet.UsingXML,thecomputersatamanu- facturingcompanycantalkdirectlytothecomputersbe- longingtothecompany’ssuppliers.Thecontinuingdrive towardpaperlessdocumentsandseamlesscommunication islikelytoeliminatemanyofthesehumaninterfacejobsin thecomingyears. The Next “Killer App” Since the beginnings of the personal computer industry, computerhardwaresaleshaveoftenbeendrivenbyapar- ticularsoftwareapplicationsocompellingthatithasmoti- vatedcustomerstopurchasethemachinerequiredtorun it.WhentheAppleIIwasintroducedin1977,it wasin- itiallyasuccesswithinarelativelysmallgroupofcomputer hobbyists. It wasn’t until the first electronic spreadsheet, VisiCalc,wasdevelopedthattheAppleIIbegantogener- ate wider interest. VisiCalc was the catalyst that helped transformtheAppleIIfromaninterestingtoyintoatrue businessmachine.Likewise,whentheIBMPCwasintro- duced,Lotus1-2-3fulfilledthe“killerapp”role.Later,it [...]... led to the Internet—now considers military robotics to be one of its top research priorities.29 In the coming decades, we can anticipate far more advanced robots playing an increasingPlease see “Machine Intelligence and the Turing Test” in the Appendix for more on artificial intelligence * Copyrighted Material – Paperback/Kindle available @ Amazon THE LIGHTS IN THE TUNNEL / 86 ly autonomous role in warfare... factory called the ribosome, the recipe captured in the bar code is again read by other nano-machines that build protein molecules It is these protein molecules that are the true building blocks of life Our muscle tissue, the hemoglobin in our red blood cells, the insulin that we need to process sugar, the enzymes that digest our food—all of these and countless thousands of other structures and chemicals... what is happening, it will be very late in the game Economists looking at past data are always looking back at the flat (left) part of the geometrically increasing technology line Prior to the point where the impact becomes obvious, there is really no way past data can show them the steep vertical part of the line that lies ahead The Luddite Fallacy As mentioned previously, economists have invented a... much of the routine work required within commercial and industrial job settings is far less challenging than producing autonomous military robots The U.S military is rightly investing substantial resources in studying the future impact of robotics and artificial intelligence on the way in which future wars will be fought And yet, little or no cohesive thought or planning is being given to the disruptive... and has been operating Copyrighted Material – Paperback/Kindle available @ Amazon THE LIGHTS IN THE TUNNEL / 88 since long before human beings walked the earth.* It is all around us and even inside us All living things, at the most basic level, operate under the direction of molecular machines We know that our genetic recipe is encoded in the double helix-shaped DNA molecules in the nucleus of our... on the screen The assistant is capable of tasks such as making airline reservations or scheduling meetings and requires the most advanced hardware available According to the New York Times, Microsoft’s virtual assistant can “make sophisticated deciCopyrighted Material – Paperback/Kindle available @ Amazon THE LIGHTS IN THE TUNNEL / 84 sions about the people in front of her, judging things like their.. .THE LIGHTS IN THE TUNNEL / 82 was graphic design and desktop publishing software that drove the Apple MacIntosh to success In recent years, the highest sales growth for the computer industry has not been in high-end desktop computers but instead in laptops and, lately, the newer netbook machines that provide a simple and inexpensive way to browse the web At least in part, this probably... decline in manufacturing jobs, even in developing nations.”33 According to the article, even back in 2003, automation was causing significant job loss in Brazil, India and China We cannot succumb to the temptation to assume that the rising middle classes in China and India are going to solve the demand problem Our simulation in Chapter 1 used just one tunnel to represent the entire world mass market Export... process will continue indefinitely I think the reason that economists cannot see what is really happening may be that they are simply too buried in their data In recent decades, the field of economics has been increasingly taken over by the branch of the field known as econometrics Econometrics is essentially a merger of economics and statistics Econometricians engage in the task of analyzing reams of... have to be fully automated Certainly there may be jobs for a fewvery highly trained technicians, but the idea that jobs will be created for blue collar workers is fantasy If in fact, at some point in the future, the Copyrighted Material – Paperback/Kindle available @ Amazon THE LIGHTS IN THE TUNNEL / 90 bulk of our traditional manufacturing evolves into nanomanufacturing, the global impact on employment . helped transform the AppleIIfromaninterestingtoyintoatrue businessmachine.Likewise,when the IBMPCwasintro- duced,Lotus1 -2- 3fulfilled the “killerapp”role.Later,it THE LIGHTS IN THE TUNNEL / 82 CopyrightedMaterial–Paperback/Kindle. businesses over the Internet.UsingXML, the computersatamanu- facturingcompanycantalkdirectlyto the computersbe- longingto the company’ssuppliers. The continuingdrive towardpaperlessdocumentsandseamlesscommunication islikelytoeliminatemanyofthesehumaninterfacejobs in the comingyears. The Next “Killer App” Since the beginnings of the personal computer industry, computerhardwaresaleshaveoftenbeendrivenbyapar- ticularsoftwareapplicationsocompellingthatithasmoti- vatedcustomerstopurchase the machinerequiredtorun it.When the AppleIIwasintroduced in 1977,it. associated with this process is in collecting, copying, collating and faxing in- formation. The intellectualportionof the job—eitherap- provingordenying the loan—isprobablyalreadyessential- lyhandledbyacomputer.Throughout the economy,there   * Formoreonroboticsanditspotentialimpactonemploymentand on