// Patrick Louis

Internet: Medium For Communication, Medium For Narrative Control

The Actors And Incentives: New Economies

The spectacular widespread magnetic cures of doctor Franz Anton Mesmer. Work based on the magnetic bipolarity of the human body and the influence of an all pervasive vital fluid.

  • Internet: Medium For Communication, Medium For Narrative Control
  • Part 2 — The Actors and Incentives
  • Section 1 — New Economies: Information Economy, Attention Economy, Data Economy, Surveillance Economy
Table Of Content
  • Data And Attention As New Assets
  • How Much Value
  • The Actors (Social Media, Ads Networks)
  • What They’d Do To Get It
  • What They’d Do To Protect It

The artifacts we’ve previously seen have given rise to new types of economies, tools, and arsenals that can be used by different actors for different incentives.
Let’s start by focusing on the economic aspects by looking at actors such as social media platforms, newspapers, and advertisement companies.

Life in an information society is about moving data, the new raw material, around our manufacturing pipelines. This data is then consumed by either paying with attention or money.
Data and attention are the two assets of the digital economies that emerged.

Whoever holds the means of productions, by centralizing and monopolizing them, has a tremendous advantage in any economy. In a data economy these are the data brokers who figuratively data mine the raw material, store it, and keep it well guarded — as is required in any intangible economy to succeed (See Capitalism Without Capital: The Rise of the Intangible Economy).

The other new asset is attention. In an environment where it is at the same time so hard to reach an audience and, once reaching a threshold, so easy to spread virally, having the skills to capture attention is valuable.
This is due to multiple factors such as the rise of social media, the average users becoming generator of content, and the ever-growing infobesity.

Davenport & Beck (2001) define attention as “focused mental engagement on a particular item of information. Items come into our awareness, we attend to a particular item, and then we decide whether to act.
Its scarcity turns it into a prized resource, constructing an attention economy. Attention is exchanged as a commodity, either by giving it or taking it — an intangible good on one side, money and physical goods on the other.
There is a fight for this resource, the corporate entities need it because the digital economy is in sync with advertising. The drivers and generators of money are buyers of attention and data, namely marketers and advertisers. Just like traditional media advertising, the online world follows a model that uses a linear process called AIDA: Attention, Interest, Desire, and Action.
Hence, social media platforms, online newspapers, and others make money by selling ad spaces, selling targeting information using the data gathered, and giving access to or selling the data itself.

Marketers have two choices when it comes to social media: either passive marketing — gathering data from their consumers posts and public information — or active — engaging with users, creating polls, paying influencers to advertise a product, etc..
Both parts are facilitated by platforms that allow tracking and analyzing the results of their campaigns. Advertisement is only a sub-section of marketing.

As for online newspapers, and many others, they have chosen to either sell ad space, thus attention, or switched to a subscription model in which the customer pays to get access.
Some argue that the centralization of ad services forces companies to offer paid services, leading to an overall more expensive online experience. There are big questions regarding the value of the content we consume online and how much should be paid for it. The concept of micro-transactions and micro-payments comes to mind, we’ll come back to them in the solutions part.

The internet conundrum is that users have developed a habit of expecting online services to be free. So, to make the services offered profitable, the owners have to extract valuable things from their users, namely their attention and generated data.

The digital culture expert Kevin Kelly describes the expected attributes of this economic space as:

  • Immediacy - priority access, immediate delivery
  • Personalization - tailored just for you
  • Interpretation - support and guidance
  • Authenticity - how can you be sure it is the real thing?
  • Accessibility - wherever, whenever
  • Embodiment - books, live music
  • Patronage - “paying simply because it feels good”,
  • Findability - “When there are millions of books, millions of songs, millions of films, millions of applications, millions of everything requesting our attention — and most of it free — being found is valuable.”

In direct relation with the data economy, a sub-type of economy has appeared that specializes in a particularly profitable data type: personal data. The surveillance economy, as it came to be called, centers itself around making profit from gathering personal information, commodifying it.
This data is obviously more valuable and can be sold for reasons other than precise targeted marketing, such as creating a voters profiles database to be sold to state actors. This was the case of Cambridge Analytica, who used Facebook as a tool to gather information. Allowing them to join up to 7 thousand data points on 240M people. We’ll see more of that later.

This grants companies access to information that can be used to tailor their products to their customers’ needs, and customize their marketing campaigns to specific categories of people, to what we call “buyer personas”. This is good for passive marketing.
For example, a job ad can be sent precisely to men between 25 and 36 that are single and have interests in cars.
When so many data points are involved in identifying an audience, this is referred to as microtargeting.

In the past advertising was used with the goal to inform consumer choices, today it is predominantly used to persuade them, going back to our section on persuasion and propaganda. It steers consumers toward the brands which invest more in advertising, rather than those that are sustainable and responsible but less competitive. Thus, driving global consumption artificially.

Active marketing, engaging with users, works well in a surveillance economy too. Companies can perform direct continual experiments on their customers without them being aware of it nor giving consent.
An A/B or Wizard of Oz testing phase that would’ve taken months to perform can be done in a matter of hours on social media, an almost instantaneous feedback.

In the past marketing used to be more of a one-to-many type of communication, with the internet it now appears more intimate, a one-to-one customized experience with the brand. The company can build a relationship with their customers for long-term success.
This relationship can then work in their favor through the viral nature of social media. The consumers who find what they are looking for will share their positive experience, while those who didn’t will also communicate it. The opinions will proliferate and increase in number.

From the data gathering side of the equation, big tech companies are then justified in amassing data at all costs, tracking and analyzing. This affects privacy and control over our lives, we’ll see some of the deleterious consequences later. The data includes location history, preferences, age, name, and other things we’ve seen in the previous data and metadata section.

These three or four types of economies, digital, data, attention, and surveillance, clash together. The first one generates a mountain of advertisements and content that floods people, making them more picky about what they pay attention to. Accordingly, the value of attention rises, it being more scarce, creating additional incentives to invest into specific targeted advertisement, hence more surveillance.
A true arms race driven by a contamination of the supply that is often filled with irrelevant, redundant, unsolicited, low-value information. An adverse effect of this information revolution.

One of the many consequences, which we’ll see later, is something called continuous partial attention, a phenomenon where someone’s attention is constantly divided. It can lead to increase stress and an inability to reflect or make thoughtful decisions, sometimes related to analysis paralysis.
This consequence is convenient to some actors, especially in relation to what we’ve seen in the propaganda and persuasion section.

There’s a lot of money involved and many reasons to secure a position in these new economies. As with any new commodity that spawns, is lucrative, and fast growing, it attracts regulators and policymakers that want to restrain its control and flow.

Every year, companies worldwide spend more than 1.3 trillion dollars on commercial communication and 600 billion dollars on advertising. The titans of the internet, Alphabet, Amazon, Apple, Facebook and Microsoft look unstoppable. They are part of the most valuable listed firms in the world. Their profits keep surging: they collectively racked up over 25 billion dollars in net profit in the first quarter of 2017.

This is compounded with the feedback effect that more data encourages more data. This confers an enormous advantage to already large incumbents, the ad technology suppliers that have amassed a wall of well guarded data.
In this economy it is quantity over quality.

The giants span different fields, Google can see what people search for, Facebook what they share, Amazon what they buy. There’s no room for small players such as online newspapers, or any other SMEs, they can’t compete. This means the biggest players have a strong grip on the supply chain, both the data, attention, and the ad tech.

Size isn’t the issue here but the danger it can have on the consumers in these economies. It impacts everyone along the supply chain, from publishers, to advertisers buying ads, and the consumers.
This can create conflicts of interests, giving a self-preferenciation to specific suppliers of ad technology. These later can then control the price of access to it, its quality of service, and the transparency going along with it.
With such control, these companies can thwart competitors, either by hoarding more data and making it impossible for others to rival them, or by acquiring or destroying contenders.
For instance, many think that Facebook’s acquisition of WhatsApp for $22 billion falls in that category, namely creating a barrier of entry and stifling competition.

Unquestionably, these data brokers are nothing without their network of buyers, the advertising companies and other entities interested in getting access to mined data and attention. While there are many small players, the bigger ones will often sign partnership deals with the data brokers, so-called third-party partnership (or sub-contractors), to exchange and interoperate data laterally.
There are countless examples of these generally non-transparent deals, at least non-transparent with regard to the data subjects which have their information exchanged without their consent.

For example, AT&T may use third-party data to categorize subscribers without using their real names to show them ads. In practice, that means AT&T can find out which subscribers have which health issues — or which ones bought over-the-counter drugs to treat it. The companies extracted this kind of information from the databases accessed through third parties which contained subscribers’ spending.

An investigation by the New York Times from 2018 detailed how Facebook had made special agreements to share/give access to personal user information and private chats to 150 tech firms, including Amazon, Apple, Microsoft, Netflix, Spotify, and Yandex. The list also included online retailers, car-makers, banks, phone manufacturers, and media organizations.

Facebook distinguished between two types of relationships: integration and instant personalization partnerships.
The first one is about offering Facebook’s features outside its own app or website, the users having to sign in to their account to allow it.
The second one, “instant personalization”, is about allowing other apps to interact with Facebook private messages to customize them.
Facebook noted that it ended “nearly all” of the integration partnership and most of its personalization partnerships.

Facebook is a gargantuan player, but only one among many like Google and Twitter. They all have such deals and act as data brokers.
The most interesting type of partnership relying on these gigantic databases of personal information are the ones with state actors. For now, let’s only note that the USA government requires would-be immigrants and visa applicants to submit five years of social media handles for specific platforms identified by them, mainly Facebook. We’ll see how lucrative social media are for states later.

With lots of money and people involved, many aggressive tactics are used to get the attention and personal data of people, any legal means are allowed. That is why they rely on persuasive technology, a term used to refer to any technology designed to change attitudes or behaviors through persuasion and social influence. In our case, they are used to persuade to act based on ads, pay attention, and give personal data.

The use of persuasive design is custom-fit to the receiver, for example it can be based on age-appropriate desires.
The preliminary information can be gathered from all the sources we mentioned in our data and metadata section such as smart utilities, and our daily ubiquitous online activities. This is all possible because the user inadvertently agreed to a hidden privacy policy, in most cases without reading it. In so far as this is the argument used by these platforms to allow this, while making it as cumbersome as possible to understand what the policies imply.

Then, once the target is set, the software platform algorithms will explicitly or implicitly attempt to win the attention of the users through interface and psychological tricks based on the interests and personalizations from the data extracted earlier.
This includes mundane things such as catchy click-bait titles of news articles, and visual tricks such as using shocking pictures, impactful fonts, and attractive colors. The usual in marketing and other types of media (TV, newspapers, radio).
The new nefarious techniques rely on dark patterns, user interfaces that are designed to mislead and direct users into acting a certain way. This includes hiding parts of the interface that are supposed to be there for legal reasons, encouraging users to sign up or buy services or items they didn’t intend to, and more

Additionally, the platforms will create an environment that nurtures attention, shaping it using the data acquired. This ranges from benign things such as showing users what they are looking for, to turning the digital environment into a casino-like environment.
Social media are especially known to employ this stratagem, relying on the craving for social feedback that people want and mixing it with a reward system, be it “like”, “views”, or “shares”. Overall, this is a vicious cycle made up of a classical conditioning scheme that creates a drug-like addiction for the users participating on social media.

These techniques work well on adults but even better on kids. Perniciously, the different platforms involved have used them to target younger and younger people. The typical age when kids get their first smartphone has fallen to 10yo.
There’s more profit to be made out of a blank mind than an already filled one. This manipulation for profit is a reminder of our section on propaganda and how having full control of an environment allows for indoctrination.

The children are then caught in a virtual environment replacing their real-world needs and basic human drives: to be social and obtain goals.
To reiterate clichés, for teenage girls it could be wanting to be socially successful, and for teenage boys to want to earn competences. Meanwhile, they can easily fall victim to the internet’s attention and surveillance economies — an endless pursuit of stimulating virtual points which they believe will make them happy and successful.
I digress, we’ll have a full part with consequences.

Strikingly, the tracking and fight for attention starts earlier than childhood, the digitalization of our lives starts before birth. This is why data on pregnant women is the most valuable. We are the very first generation to be datafied before birth, this is a historical transformation.

On social networks, people most of the time want to entertain themselves, and entertainment is what makes them stay. One type of very popular entertainment is political infotainment, a sort of caricature of politics. A large portion of end users visit social media only for politics, and so the platforms will be incentivized in promoting this type of content. They give what people are looking for.

Many of these digital spaces rely on something called a “feed” or “home” page that will be generated and presented by default. This page will be optimized and curated by algorithms for the goal of the platforms. It is highly individualized, the news and information are selected by engagement value, intentionally designed to isolate end users from information that will make them leave, and creating a self-reinforcing feedback loop of confirmation, thus satisfaction.

From recommendation engines, search results, trends, autocomplete forms, it all happens through the mediation of algorithms. Whatever content is able to satisfy the criteria of the algorithms will be promoted, be it through clickbait titles, paying for fake views, fake reviews of products, bots interaction, and outrage-related and emotion inducing content.
The objective is to predict what we are more likely to interact with: click, view, engage.

The algorithms themselves are impartial, they do not know what the actual content is, and cannot discern between what is true and what isn’t. They are simply good at what they were programmed to do.
The algorithms are trade secrets of the platforms, opaque tools that influences millions of people each day. The data brokers and networks use this as a justification of non-accountability for the consequences, something we call mathwashing. Hiding behind the algorithm and pleading free speech.

Algorithm amplification is the phenomenon we are experiencing, the automatic radicalization of views and disinformation as an instrument for more views and spiraling out of control. It is a business choice made in pursuit of profit.
Social media will reward, through the point systems, extreme stances on subjects, these serve as the lubricant for these businesses, making them more profitable and influential. Studies have shown how users feel satisfied when finding a niche to cater to that generates a lot of these points (likes/shares).

This is an effect that is comparable with TV long-term media effects theory. It states that the more an individual watches television, the more they believe social reality matches what they see on it.

These have ramification in the real world, the consequences can be dire, as we’ll see later. For example, hate speech amplification can thrive and fuel genocide. Internet platforms play a dominant role in our conversation, extremism cultivated online has real world ramifications.

Evidently, they are now under public scrutiny and lawmakers want to intervene but social network, ad tech service providers, and others in the loop will fight to defend their castle of data.

The most common argument is that users have consented to what is happening by agreeing to the privacy policy and EULA they were presented with when signing up to the service. It is ok because it is the inevitable conclusion of our online activity. In other words, asking companies whose business models revolve around exploiting personal data for consumer-influence techniques to explain their privacy policies is like asking someone to shoot themselves in the foot.

The companies are now tweaking their tactics, using a patch-like approach rather than tackling the real issue, which is the core of their business. We’ll see in the last part some real solutions.

For example, AT&T recently said they would stop sharing users’ location details with data brokers, Facebook said it stopped allowing advertisers to use sensitive categories for targeting, Google said it’s now allowing users to download masses of their data.
Recently Google is also going to remove third-party cookies, to then allow third-parties to have access to the data only through them and getting information about groups and not individuals. They also get information directly from other sources such as their analytics and AMP service. A sort of differential privacy. Arguably, these give Google even more power over this type of data and drives away competitors.

In some countries, like the USA, the companies hide behind laws related to free speech to justify their policies. They are claiming that they do not want to be arbiters of truth.
That helps in taking the blame away from them, leaving them unaccountable as no USA critics want any platform to act as a censor.

As a last resort, like in any industry big enough, these companies don’t shy away from using their money to convince the lawmakers anywhere in the world.
Between 2005 and 2018, the big five tech in the USA have spent more than half a billion dollars lobbying the USA Congress, and donating to parties. Literally purchasing power.
Moreover, other databrokers also spend as much, companies such as CoreLogic spent as much as $215,000 on lobbying in 2020; and Acxiom, which spent $360,000 on lobbying in 2020 for issues related to data security and privacy.

Amazon, Apple, Facebook, Google and Microsoft have collectively thrown $582 million at legislators in an attempt to influence the lawmaking process and make sure their voices (and interests) are taken into account.

All of the firms have taken a position on privacy policy, with the issue coming up 3,240 times in all reports files—by far the most talked about topic. Last year alone, $66.4 million was spent on privacy issues by the tech giants. That includes $16.6 million from Google, $15.1 million from Amazon and $13 million from Facebook.

Whatever legality they deal with, like anything legal, depends on the country where the law is applied. Thus, any solutions will be localized, as we’ll see later.

This concludes our review of the emergence of new economies in the digital space with regards to social networks and ad tech providers. We’ve first seen the two new assets: data and attention. Then we’ve looked at their worth and which actors had incentives to capture them. Next, we’ve seen how a few are owning the pipeline in this new infrastructure and how they have agreements with third parties. After that we’ve dived into some of the manipulation tactics used to gain such assets. Finally, we’ve listed a few of the defenses some of these companies have used against policymakers.

Table Of Content


Attributions: E. Sibley, A Key to Magic & the Occult Sciences, c. 1800

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