Tim O’Reilly, ‘the Oracle of Silicon Valley’ lets fly at Big Tech

“Tech’s addiction to addictive behaviour on the part of its users is actually part and parcel of the system we have built.” If this reads like the lament of a washed-up old Leftie, O’Reilly is quick to defend and celebrate the role of capital and markets in building companies like […]

“Tech’s addiction to addictive behaviour on the part of its users is actually part and parcel of the system we have built.”

If this reads like the lament of a washed-up old Leftie, O’Reilly is quick to defend and celebrate the role of capital and markets in building companies like Amazon and Tesla. It is because he sniffs something amiss that he is so passionate.

He doesn’t deny that there’s still “a lot of innovation” but worries that “we also have created a system where a lot of people can get rich without actually producing a lot of value”.

Many Silicon Valley companies, he fears, are no more than “the financial instruments that led to the 2008 financial crisis. Nobody actually has a clue about how a company is going to make money. It’s designed to be acquired. If it can go public without having profits, that’s just great. But that only works as long as you can sell to the biggest sucker. It’s a pyramid scheme.”

What the next supermen of Silicon Valley think of such jeremiads as they flock to the conferences at his California headquarters that have become a key part of O’Reilly’s business strategy, is anyone’s guess.

Perhaps O’Reilly hopes to change their minds, to create better, more altruistic, long-termist companies in the future. But perhaps it is part of a cannier plan.

Because, ultimately, he sees tech not as the problem, but the answer. Policies, he believes, are just like algorithms – they optimise for, and incentivise, certain behaviours. If tech is going astray, it is because policy has gone astray, creating the wrong incentives. And who better to fix that than those who understand algorithms best.

“This is about how we design systems. So we need to take the lessons of tech and bring them to policy design,” O’Reilly says, unflagging after more than an hour. “And tech companies, for all that’s wrong with them, are good at managing algorithmic systems. Our governments have to learn to get good at it as well.”

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