There was a time when the idea of giving your credit card information online was unthinkable, despite the fact that you’d readily hand it over to a total stranger (aka, waiter) in a restaurant, who would vanish for a few minutes before returning it. Now people don’t think twice about it, despite what we know hacks of Equifax, Yahoo (Every single Yahoo account was hacked – 3 billion in all) and most recently, the massive US military social media spying archive left wide open in AWS S3 buckets. Actually, All the Major Companies Have Been Hacked.
While there have been cryptocurrency hacks, still believe that it’s the blockchain that’s unsafe?
The blockchain is still a relative unknown and, truth be told, terra incognita for most. Think of it as the early days of the Internet, in the days when the web was accessed via the c prompt (C>). It was geek and early adopter territory back then, until Netscape came along, providing a graphical user interface that changed everything.
Blockchain and the Silicon Valley Elites
While the naysayers are anything but in short supply, you don’t hear much about the blockchain from the tech uberlords, so let’s do the math. Fake accounts and developing countries aside, Facebook is not shy about monetizing its users via its massive data collection. According to a 2015 article in The Telegraph, Facebook expected revenues of $73.29 per user, per annum by 2017, and that was before the company started collecting 99 cents out of every advertising dollar from its media partners – and some 44% of Facebook users get their news through the platform – so we expect that that’s a lowball number.
In the blockchain world, you own and control your data. Let’s say Facebook refuses to allow you an account unless they have access to your data. Well, how long do you think it’ll be before a next generation Facebook comes along, with a new and different monetization model? You may have to pay an annual fee for a Facebook account, but the magic number is not going to be $73.29 per user, per annum.
Ditto data collection engines Google and Amazon.
Once the product is ‘free,’ it’s difficult to move users to a paid model, so you have to wonder what Facebook is really worth. As Investopia noted when Facebook first went public, “Facebook could just charge that $5.32 average revenue per user directly to the user, on a subscription basis. The problem is that not only would users either cancel their accounts by the millions, or never agree to pay the subscription fee in the first place, setting a fee would also eliminate the possibility of further dynamism and growth. For a social media site to go from 300 million users to 600 million and beyond, access has to be easy, almost effortless, and most of all, free. Using an advertiser-supported model, rather than charging each user individually, is unquestionably the easiest way for Facebook to garner as many users as possible. The more users on the site, the greater the number of advertisers willing to engage them, and the more those advertisers are willing to spend. Making for the most virtuous of circles for Facebook’s management and shareholders.”
Now along came Polly. Or rather, the blockchain.
Once the blockchain becomes ubiquitous and users are no longer the product, it won’t be long before supposedly embedded and definitely grossly overreaching empires fall and/or revert back to being companies rather than global megastates. It’s basic physics. Users have been the focus group for quite some time. People in focus groups traditionally get paid. Should be fun, once the tables turn.Truth is, they need you more than you need them. Stay off Facebook for a week or two, frequent users, and count how many push notifications you receive.
We attend many events and mentions of the blockchain are becoming more and more prevalent, and it seems to strike fear if not terror in the hearts of so-called tech-savvy, so-called digital natives. They know what they know and are not prepared for the ground to shift beneath their feet, much the same way the Luddites of yore during the early internet era were unprepared for the shift in the tectonic plates and so went into denial.
We see how well that worked out for them.
What Man Cannot Remember He Is Doomed to Repeat
“Not sure about the use case,” these neo-Luddites say – only the terms have been changed to deceive the clueless: it’s living in denial by any other name and nice try. “Not sure that it will catch on…” Ah, what man cannot remember… and ignorance of history is no excuse.
Want to know how Amazon conquered brick-and-mortar so quickly? They followed the Sears playbook (The History of Sears Predicts Nearly Everything Amazon Is Doing).
The current Internet era of data collection, from the viewpoint of the Facebooks and Googles and Amazons of the world, is a clear case of what’s mine is mine and what’s yours is mine. We control the platforms. We control your information. Don’t touch that dial. The blockchain is the next phase in online history, and they only have themselves to blame. The pendulum always swings back. The change won’t happen overnight, but rather, slowly, then all at once.
We watch with rapt attention as this next chapter plays out, and it’s coming. We do understand why many of the digital natives feel so unnerved by these oncoming developments: again, the tectonic plates are shifting, and it’s a force beyond their control. Take a deep breath as this next part of the story/history unfolds. As we’ve often said: the waiter always comes around with the check. Onward and forward.