Even as the tech industry is indulging in its mutual love fest in Las Vegas this week, the long-term consequences of decisions its leaders made years ago is being felt well beyond the glitz of Sin City. While attendees are marveling over product demos like Sniffy, the heritor of Smell-O-vision, Viktor, the smart-pillow for seniors, and PicoBrew, the intelligent distillery as well as a raft of more-standard product announcements from tech giants like Dell, HP, Lenovo, Panasonic, Samsung, and others, elsewhere across the nation the more ominous side of tech is on display.
Even as Intel CEO Brian Krzanich was giving his keynote speech in Vegas Monday night, his minions were struggling to deal with the fallout of an architectural decision the company made more than a decade ago. Krzanich told his audience that Intel would issue a fix forthwith, but it can’t retroactively alter silicon chips forged in its multibillion dollar factories, and any software fix will affect performance to some degree. Intel has done a lot of twisting and turning in the past week as the implications of this complex flaw became clearer. But Wall Street is having none of it, and the stock has been hammered. Although it seems likely that Krzanich’s made a large sale of his Intel stock after he knew of the flaw but before the public did, he seems to be narrowly covered by a selling program that moves a fixed percentage of his holdings on a schedule. The fact that this particular sale was larger than previous exits was a function of the size of the grant (bigger) rather than the percentage, which remained unchanged. Narrowly covered, yes, but the optics are terrible.
The crux of the design decision that led to this debacle was to promote performance over security, essentially allowing data to remain in a memory location so it could be reused without having to reload it. At the time, the choice made sense. But in today’s world of cloud-based multi-tenant virtual machines, it can leave customers’ data open to a side-channel attack. The fix will protect the data, but will also negate some of the performance improvements that were the reason for the design in the first place.
AMD has been making hay while this unexpected sun shines. But I wouldn’t get too happy over that. AMD primarily benefits from having in effect zero position in the cloud server business. No flaws because … no machines! It’s not like AMD’s parts don’t also do speculative and out-of-order execution. The market also reflected this dawning understanding as it initially took AMD stock up on the news and back down again upon further reflection.
And further afield, we have the remarkable situation in which many tech industry leaders, having made their billions from feeding us addictive technologies, designed explicitly to keep us engaged with Pavlovian certainty, are now repudiating their own technologies — but not, we note, offering to give back any of the spoils.
Three executives from Apple, which has not had a presence at CES since the 1990s, Facebook, which is mostly in hotel back rooms, and Twitter, which is in great use at the show but not actually present as a company, all stood up and told the New York Times that their technologies seem to be having a negative impact on society. Tony Fadell, one of the iPhone’s creators, called it “addictive” and talked about “unintended consequences.” Sean Parker, early financial backer of Facebook, spoke of the social network’s potential interference with productivity and wondered, “God only knows what it’s doing to our children’s brains.” Evan Williams, co-founder of Twitter called the Internet “broken.”
It’s all very well to observe these things from the comfort of their soaring decks overlooking the Pacific, but we down here are living the nightmare. I’ve often wondered why Twitter doesn’t just shut Donald Trump off to show him who’s boss.
These guys (and they are all guys) realize that something is not right, but they won’t make a move toward fixing it if the fix will disturb their cash flow. The thing they don’t realize is that this too may pass. Remember The Well? It was the first real social network. And all those discs that used to come in the mail from America Online? Today, AOL is a pale shadow of its former self. MySpace? Same thing. Social networks tend to get polluted over time as the bad drives out the good. Many of my friends are abandoning Facebook because they see nothing but vitriol and trollery when they open the page. I realized recently that I had not even looked at my Twitter direct messages in the past year.
Apple wants to increase parental controls on iPhones, but all that does is change the pitch of the battle between kids and parents. Now, the kids will whine and stamp their little feet until the parents lift the controls. The kids know what a smartphone can do, and their friends all have one.
Maybe the market will self-correct. We can only hope.
Meanwhile, the industry celebrates itself, as it does every year, in the desert of the Southwest.