Marc Andreessen

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Silicon Valley oligarchs don’t get much jerkier than Marc Andreessen, a real toolbox who has to bury beneath his arrogance perfectly reasonable people who disagree with him. You’re not simply wrong if you worry that machine learning may lead to technological unemployment–you’re a dope worthy of scorn. 

Andreessen stepped into it in a big way a few days ago with a tone-deaf tweet about India, after the country embraced net neutrality and blocked a Facebook app. Instead of arguing the move would harm the developing nation and explain why, the venture capitalist sent out 140 callous characters of pro-colonialism. As if billionaires didn’t have a bad enough name already.

It’s great that the shitstorm that followed made Andreesen withdraw his comments and apologize profusely, but where there’s no sense of humility, there are likely no lasting lessons learned. 

From Nellie Bowles in the Guardian:

When the news came that India had rejected Facebook, board member and investor Andreessen tweeted the missive that echoed around the world: “Anti-Colonialism has been economically catastrophic for India for decades. Why stop now?”

One sunny San Francisco day later – after Facebook co-founder Mark Zuckerberg was forced to publicly disavow the tweet – Sharma was calling in on Arvind Gupta, who invests in and guides a group of early stage startups at his accelerator IndieBio. Their conversation quickly shifted to Free Basics and Andreessen’s message.

Gupta said he felt Facebook’s stumble was partly due to distance and being out of touch with Indian people.

“It’s easy to think this is a good idea 5,000 miles away in your nice apartment,” Gupta said.

Sharma saw it as part of a broader issue of homogeneity in Silicon Valley, a region run by a narrow set of oligarchs who famously eschew hiring women or people of color.

“Why is the Valley suddenly so tone deaf? Well, look how badly the Valley does on inclusion in hiring. Bias is the norm here,” Sharma said. “Why is the Indian user any less capable than anyone else? Why do they have different needs than you do? They don’t. But that thinking is all part of the same problem.”•

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To the naked eye, Marc Andreessen appears like a giant mass removed from the base of Steve Ballmer’s spine. The Netscaper-cum-V.C.er is an interesting guy, but he’s also an extreme techno-optimist, a true believer to an obscene degree in the transformative power of Silicon Valley, and like most deeply devoted souls, he can be annoying as fuck. 

Tad Friend, an enormously enjoyable New Yorker writer who’s uncommonly gifted at simultaneously telling a macro and micro story, profiled the Northern California idolmaker and his milieu, an enchanted land where men (almost exclusively) with money dare to divine the next Google or Facebook, gambling in casinos still under construction, trying to identify black swans and ride unicorns. Along the way, Friend vividly depicts this modern strain of capitalism as well as reveals his subject, of whom he writes these two sentences: “Marc Andreessen mentions Thomas Edison often, his family never” and “Andreessen represents the Valley—both in its soaring vision and in its tendency to treat people as a fungible mass.”

The opening:

On a bright October morning, Suhail Doshi drove to Silicon Valley in his parents’ Honda Civic, carrying a laptop with a twelve-slide presentation that was surely worth at least fifty million dollars. Doshi, the twenty-six-year-old C.E.O. of a data-analytics startup called Mixpanel, had come from San Francisco to Sand Hill Road in Menlo Park, where many of the world’s most prestigious venture-capital firms cluster, to pitch Andreessen Horowitz, the road’s newest and most unusual firm. Inside the offices, he stood at the head of a massive beechwood conference table to address the firm’s deal team and its seven general partners—the men who venture the money, take a seat on the board, and fire the entrepreneur if things go wrong.

Marc Andreessen, the firm’s co-founder, fixed his gaze on Doshi as he disinfected his germless hands with a sanitizing wipe. Andreessen is forty-three years old and six feet five inches tall, with a cranium so large, bald, and oblong that you can’t help but think of words like “jumbo” and “Grade A.” Two decades ago, he was the animating spirit of Netscape, the Web browser that launched the Internet boom. In many respects, he is the quintessential Silicon Valley venture capitalist: an imposing, fortyish, long-celebrated white man. (Forbess Midas List of the top hundred V.C.s includes just five women.) But, whereas most V.C.s maintain a casual-Friday vibe, Andreessen seethes with beliefs. He’s an evangelist for the church of technology, afire to reorder life as we know it. He believes that tech products will soon erase such primitive behaviors as paying cash (Bitcoin), eating cooked food (Soylent), and enduring a world unimproved by virtual reality (Oculus VR). He believes that Silicon Valley is mission control for mankind, which is therefore on a steep trajectory toward perfection. And when he so argues, fire-hosing you with syllogisms and data points and pre-refuting every potential rebuttal, he’s very persuasive.•

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Andrew McAfee, co-author with Erik Brynjolfsson of 2014’s great Second Machine Age, recently argued in a Financial Times blog post that the economy’s behavior is puzzling these days. It’s difficult to find fault with that statement.

Inflation was supposed to be soaring by now, but it’s not. Technology was going to make production grow feverishly, but traditional measures don’t suggest that. Job growth and wages were supposed to return to normal once the financial clouds cleared, though that’s been largely a dream deferred. What gives?

In a sequel of sorts to that earlier post, McAfee returns to try to suss out part of the answer, which he feels might be that the new technologies have created an abundance which has suppressed inflation. That seems to be certain feature of the future as 3D printers move to the fore, but has it already happened? And has this plenty made jobs scarcer and suppressed wages? An excerpt:

In a Tweetstorm late last year, venture capitalist Marc Andreessen argued that technological progress might be another important factor driving prices down. He wrote: “While I am a bull on technological progress, it also seems that much of that progress is price deflationary in nature, so even extremely rapid tech progress may not show up in GDP or productivity stats, even as it = higher real standards of living.”

Prof [Larry] Summers shot back quickly, noting: “It is… not clear how one would distinguish deflationary and inflationary progress. The price level reflects the value of goods in terms of money, so it is hard to analyze without thinking about monetary and financial conditions.” This is surely correct, but is Prof Summers being too dismissive of Mr Andreessen’s larger point? Can tech progress be contributing to price declines?

Moore’s law — that computer processing power doubles roughly every two years — has made computers themselves far cheaper. It has also pretty directly led to the shrinkage of industries as diverse as encyclopedias, recorded music, film photography and standalone GPS devices. An intriguing analysis by writer Chris Goodall found that the “UK began to reduce its consumption of physical resources in the early years of the last decade.” Technological progress, which by its nature allows us to do more with less, is a big part of this move past “peak stuff.”

It’s also probably a big part of the reason that corporate profits remain so high, even while overall economic growth stagnates.

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Marc Andreessen doesn’t need enemies because he has himself.

The browser billionaire and start-up whisperer often tweets and talks himself into an error message, revealing a stunning lack of insight into how the silicon-less world–and even the silicon one–operates. Like a lot of true believers in meritocracy–David Brooks comes to mind–Andreessen often unwittingly imparts wisdom about the world that’s built almost wholly from bullshit. I think he really means well and has done a lot of good work, but he doesn’t make it easy on himself. Five easy pieces follow from his new Financial Times interview conducted by Caroline Daniel.

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As a child, Andreessen was fascinated by technology. “I have the complete series of Tom Swift from the 1910s to 1950s in my office. That was probably the single most important thing I read,” he says of the science-fiction and adventure books featuring a teenaged inventor hero (Tom Swift and his Photo Telephone was one 1912 title). “I liked all the stuff he’s inventing.”

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He was also fortunate in his decision to study engineering at the University of Illinois: as one of just four sites funded by Congress to host $20m to $40m supercomputers in the mid-1980s, it had funds for “the intercept-net, which became the internet”.

Andreessen sees technology as enabling what he calls the “great awakening”. Waggling his iPhone affectionately, he says: “This little guy right here is the equivalent power capability of the $20m supercomputer I was using. This thing is in two billion people’s hands.”

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He likes television, he says, because it puts the writer in charge, and compares it to the best tech companies which are also built when you put founders in charge for long periods. “By the way, writers are often crazy; they’re unpredictable, they don’t necessarily operate on a budget or timetable you might want. They argue a lot. Which is the same thing we deal with, with founders. But you get the magic.”

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Does he think there is a backlash against powerful tech companies? …

“There is no backlash,” he continues: technology companies remain popular with the public. “There is only the tech backlash of the New Yorker and the New York Times and of the New Republic and of Harvard University.

I ask why he thinks it is coming from there. “They’re threatened. It’s a power recalibration. There’s a coastal element to it. There’s a liberal arts versus engineering element to it. It’s a two-cultures thing. It’s a CP Snow thing.” Snow, a British chemist and novelist, in the 1950s identified two camps: a liberal arts culture and a science one.

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“Societies are going to get richer; all the birth rates are going to drop. Japan is a harbinger of all of our futures.” In the US, growth would be slowing were it not for “illegal immigration. It’s the best thing that can possibly be happening to us, and I find it ironic; nobody wants to talk about that.”

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Marc Andreessen is sure that the Information Age, like the Industrial Age before it, will lead to an explosion of wealth, and he’s probably right. But who will own that wealth? Will it be concentrated or diffuse? Can a highly automated society provide enough jobs or will we be playing with our smartphones in the margins? Will we have to settle for bread and Kardashians? At Jacobin, in an open letter to Andreessen, Alex Payne asserts that the average person isn’t as frightened by robots as those who own them. An excerpt: 

“While I didn’t jibe with your take on recent macroeconomic history, I was heartened to see that you’re interested in empowering individuals through technology:

[T]he current technology revolution has put the means of production within everyone’s grasp. It comes in the form of the smartphone (and tablet and PC) with a mobile broadband connection to the Internet.

If we’re going to throw around Marxist terminology, though, can we at least keep Karl’s ideas intact?

Owning a smartphone is not the equivalent of owning the means of production. I paid for my iPhone in full, but Apple owns the software that runs on it, the patents on the hardware inside it, and the exclusive right to the marketplace of applications for it. If I want to participate in their marketplace, Apple can arbitrarily reject my application, extract whatever cut of my sales they see fit, and change the terms whenever they like.

Same story with their scant competitors. It seemed like a lot of people were going to get rich in the ‘app economy.’ Outside of Apple and Google, it turns out, not so much. For every WhatsApp there are thousands of failures.

The real money in tech is in platforms, network effects, scale. Sell pickaxes and jeans to the miners, right? Only today it’s Amazon selling the pickaxes. The startup with its servers on EC2 is about as likely to find gold as a ’49er panhandler. Before the startup goes out of business, Amazon gets paid.”

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Marc Andreessen, whose Google Glasses are rose-colored, sees technological progress in one light when, of course, there are a couple of shades. It’s a net win, sure, but there’s collateral damage and an uneven distribution of the spoils. In a Valleywag post, Sam Biddle takes down Andreessen over a series of breathless technotopia tweets. Part of the summation:

In conclusion, the fact that we aren’t all living in mud huts or clinging to the side of crevasses, babies bundled in animal pelts, is a feat of Silicon Valley. The affordability of a smartphone or a television has everything to do with uncritical, unwavering faith in “tech innovation” and some childish, abstract notion of industrial progress. It has absolutely nothing to do with, say, the legion of Chinese laborers working under deplorable conditions. Ignore the fact that that owning a dishwasher doesn’t mean your position relative to the rest of society is anything resembling good or fair—just be glad your standard of living has increased since the 17th century.

This argument was better made by people like Adam Smith, over two hundred years ago, rather than Marc Andreessen, a guy inside a bubble with a bachelor’s degree in computer science:

Compared, indeed, with the more extravagant luxury of the great, his accommodation must no doubt appear extremely simple and easy; and yet it may be true, perhaps, that the accommodation of an European prince does not always so much exceed that of an industrious and frugal peasant, as the accommodation of the latter exceeds that of many an African king, the absolute master of the lives and liberties of ten thousand naked savages.

Rich have always been able to pay servants to read aloud to them; now most US households can Google ‘wealth of nations summary’ at their leisure. It doesn’t matter, though: Andreessen’s industry peers are so desperate to get some insight via Twitter osmosis, they’ll ignore that his whitewashed analysis and vague trickle-down gesturing would probably land you a C in high school. Marc Andreessen, so far as Valleywag is aware, is not a high school student, but the head of one of the most powerful venture capital firms in history.

The scariest thing here isn’t that Andreessen has such a poor grasp on the history and economics, or his flatly counterfactual statements…•

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It’s no shock that disruptive banks haven’t been the thing in Silicon Valley the way market-shifting laundry services have. Literally losing your shirt is unfortunate, but losing it figuratively is completely unacceptable. The opening of Kevin Roose’s New York Magazine article about the possibility of nouveau banking that bucks the system:

“Recently, after a long, drawn-out fight over an overdraft fee, I decided to break up with my bank. I withdrew my balance, closed my accounts, and began looking around. I wanted to find a ­disruptive bank, in the Silicon Valley parlance—one better than the opaque, fee-filled behemoths I’d dealt with in the past.

The problem, I quickly learned, is such a thing doesn’t yet exist. The big banks all offer basically the same bevy of services, and small banks and credit unions tend to skimp on the add-ons I need, like mobile-banking apps and spending trackers. All of them, big and small, run on the same outdated infrastructure—paper checks, debit cards that require punched-in pins, wire transfers that take days to clear. Despite Wall Street’s reputation for ruthless efficiency and staying ahead of the curve, the last truly important innovation in consumer banking might have been the ATM.

To listen to Silicon Valley tell it, that will change soon. ‘I am dying to fund a disruptive bank,’ venture capitalist Marc Andreessen tweeted earlier this year. Financial start-ups—known collectively as ‘fintech’—are spreading like kudzu, each with a different idea about how to usurp the giants of Wall Street by offering better services, lower fees, or both. Bitcoin and other digital currencies are the tech scene’s infatuation du jour. But a number of other companies are finding success by innovating within the monetary system we already have. ‘When I go to Silicon Valley … they all want to eat our lunch,’ lamented ­JPMorgan Chase CEO Jamie Dimon this year.”

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Technological positivist Marc Andreessen was Russ Roberts’ guest on a really good installment of the EconTalk podcast. The Netscape founder and venture capitalist sees the world as moving in the right direction in the macro, perhaps giving short shrift to those sinking in the short-term and mid-term turmoil that attends transformation. Notes on myriad discussion topics.

  • Google. Andreessen details how one of the most powerful companies on Earth had plenty of luck on its way to market dominance and its position as a latter-day Bell Labs. The search giant could have collapsed early on or been purchased, with Larry Page and Sergey Brin winding up as, say, Yahoo! middle managers. (“A fate worse than death,” as the host cleverly sums it up.) The guest recalls a fellow venture capital player calling the chief Google guys the “two most arrogant founders” he’d ever met.
  • Jobs lost to automation. The guest believes that with the delivery of smartphones into the hands of (eventually) seven billion people, that we’re at the tipping point of an economic boom and great job creation. He doesn’t qualify his remarks by saying that we’re in for rough times in the short run with jobs because of robotics. Andreesen also doesn’t address the possibility that we could have both an economic boom and a jobs shortfall.
  • Bitcoin. He’s over the moon for the crypto-currency company, saying it’s as revolutionary as the personal computer or the Internet. That seems like way too much hyperbole.
  • MOOCs. Andreesen points out that good universities will never be able to expand to meet a growing global population, so online courses will be essential if we’re to avoid a disastrous educational collapse.
  • Political upheavals. The one cloud the Netscape founder sees on the horizon is a barrage of political upheavals that will destabilize sections of the globe at times.
  • Journalism. Andreessen is sanguine about the future of journalism, believing that companies will adjust to post-monopolistic competition. He points out formerly profitable things about newspapers (classified ads, sports scores, movie times, etc.) that have been cannibalized by the Internet without guessing what will replace them for those faltering companies. If his argument was that nothing need replace them and these erstwhile powerful news corporations were no longer necessary since news distribution is now diffuse, I think that would probably be a stronger argument than suggesting that all but a few such companies are salvageable.•

 

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Even if Broadway disappeared, there’d always be theater. We need stories. The same is true of newspapers and journalism. Reportage is rarely what we’d like it to be–and those reading the news are rarely ideal themselves–but the process will always march on. Via Johana Bhuiyan and Nicole Levy at Capital New York, some predictions for the near-term future of news from Marc Andreessen:

  • The news market will expand by 2020 to about 5 billion people worldwide, consuming mostly on mobile devices.
  • News organizations that report broadly at an extremely gross scale, or very deeply at a small scale, will thrive on the new eyeballs.
  • Advertising remains the best way to make newsgathering profitable but publishers need to take responsibility for the quality of their ads, or work with partners in the ad tech field who do.
  • Subscription models, as well as conferences and events, are here to stay: “Many consumers pay $ for things they value much of the time. If they’re unwilling to pay, ask Q, are they really valuing?”

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Two exchanges from an excellent Fortune interview that Andy Serwer conducted with Marc Andreessen.

The first one focuses on something I blogged about recently, which is the possibility of the invention of new jobs and careers that may occur on a large scale in the post-Industrial Age the way it did in the post-Agrarian Age. As Andreessen points out, though, there’s a hard and scary road getting to that point in our increasingly automated society. 

The second is Andreessen’s prediction that cars will become an on-demand, shared good that will destroy the century-old ownership model. I have my doubts about the shared aspect, though I think fleets of driverless cars on demand will become a reality in cities.

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Andy Serwer:

We all understand that the Internet revolution is inevitable at this point, but it’s also kind of controversial. There are scads of new jobs at Facebook and Twitter and other places, but what about the ones that are destroyed by the inroads of technology into every industry? Are you actually creating more than you’re destroying?

Marc Andreessen:

Jobs are critically important, but looking at economic change through the impact on jobs has always been a difficult way to think about economic progress. Let’s take a historical example. Once upon a time, 100% of the United States effectively was in agriculture, right? Now it’s down to 3%. Productivity in agriculture has exploded. Output has never been higher. The same thing happened in manufacturing 150 years ago or so. It would have been very easy to say, “Stop economic progress because what are all the farmers going to do if they can’t farm?” And of course, we didn’t stop the progress of mechanization and manufacturing, and our answer instead was the creation of new industries.

Andy Serwer:

And the same story will play out with the Internet?

Marc Andreessen:

Right. So the jobs are something that happens in the end. But what happens first are improvements in consumer welfare. This is the part that doesn’t get much attention because jobs going away is a much scarier story. Improvements in consumer welfare are more diffuse, and it’s hard to specifically call them out. But it’s a really big deal. It’s a really big deal for people to have a lot more information. It’s a really big deal for people to be able to communicate and collaborate. One of the things that’s going to be huge in the future is the ability to get educated online. That’s a wave that’s going to hit in a major way in the next 20 years, and will be a huge improvement to consumer welfare all around the world. And so the gains to anybody with a screen and a network connection are absolutely phenomenal. It’s one of those things where everybody’s life keeps getting better. But you don’t get the creation without the destruction. And so there is a lot of turbulence, and will be a lot of turbulence.

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Andy Serwer:

Speaking of cars, you’ve talked about a shared economy where people will share cars. They won’t own cars. You see a little bit of that today, but is that really the way the world’s going?

Marc Andreessen:

So this is when I get really excited. This is another example of the impact of information transparency on markets. We are 90 years or so into cars. And we drive our cars around. And we own our cars. And then when we’re not in our cars they sit parked. So the average car is utilized maybe two hours out of the day. It sits idle for 90% of the time. The typical occupancy rate in the U.S. is about 1.2 passengers per car ride. And so even when the car is in motion, three-quarters of the seats are unfilled.

And so you start to run this interesting kind of thought experiment, which is what if access to cars was just automatic? What if, whenever you needed a car, there it was? And what if other people who needed that same ride at that same time could just participate in that same ride? What if you could perfectly match supply and demand for transportation?

Taken a step further, what if you could bring delivery into it? Two people were going to drive between towns, and there was also a package that needed to go. Let’s also put that in there so we can fill a seat with a package. Just run the thought experiment and say, “What if we could fully allocate all the cars, and then what if we could have the cars on the road all the time?”

And of course the answer is a whole bunch of things fall out of it. You’d need far fewer cars. The number of cars on the road would plummet by 75% to 90%. You’d instantly solve problems like congestion. You’d instantly solve a huge part of the emissions problem. And you’d cause a huge reduction in the need for gas. And then you’d have this interesting other side effect where you wouldn’t need parking lots, at least not anywhere near the extent that you do now. And so you could turn a lot of parking lots into parks.

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As much as I think smartphones are great tools, I would rather have running water. Water that runs makes me happy and less thirsty and less likely to die in the short run. And if the running water is clean and doesn’t contain fecal matter, and I won’t get cholera, wow, cool. Let’s bottle it and call it iWater. Though, sure, a smartphone would be nice, too. 

From Marc Andreessen’s responses to a word-association segment of an interview conducted by Ruchi Sanghvi at the she++ conference, as reported by Billy Gallagher at TechCrunch:

“Mobile: under-hyped

Social: extremely powerful, and people underestimate how powerful it is

Enterprise: being reinvented

Silicon Valley: the world would be much better if we had 50 more Silicon Valleys but we don’t and we probably won’t for a long time

Genomics: largely a disappointment

Big Data: lots of social, cultural, political implications, not yet figured out

Aaron Swartz: tragedy. Absolute tragedy. Hopefully a future inspiration

2020: more people on the planet with smartphones than running water”

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The opening of Chris Anderson’s new Wired Q&A with computing legend Marc Andreessen, who created the first popular graphical web browser:

Chris Anderson: At 22, you’re a random kid from small-town Wisconsin, working at a supercomputer center at the University of Illinois. How were you able to see the future of the web so clearly?

Marc Andreessen: It was probably the juxtaposition of the two—being from a small town and having access to a supercomputer. Where I grew up, we had the three TV networks, maybe two radio stations, no cable TV. We still had a long-distance party line in our neighborhood, so you could listen to all your neighbors’ phone calls. We had a very small public library, and the nearest bookstore was an hour away. So I came from an environment where I was starved for information, starved for connection.

Anderson: And then at Illinois, you found the Internet.

Andreessen: Right, which could make information so abundant. The future was much easier to see if you were on a college campus. Remember, it was feast or famine in those days. Trying to do dialup was miserable. If you were a trained computer scientist and you put in a tremendous amount of effort, you could do it: You could go get a Netcom account, you could set up your own TCP/IP stack, you could get a 2,400-baud modem. But at the university, you were on the Internet in a way that was actually very modern even by today’s standards. At the time, we had a T3 line—45 megabits, which is actually still considered broadband. Sure, that was for the entire campus, and it cost them $35,000 a month! But we had an actual broadband experience. And it convinced me that everybody was going to want to be connected, to have that experience for themselves.”

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A discussion about wearable computing from Andrew Goldman’s smart interview with Silicon Valley bigwig Marc Andreessen, in this Sunday’s New York Times Magazine:

People view you as an oracle in the valley. I was hoping you’d blow my mind with something you see in the future. 

Gordon Bell at Microsoft is working on wearable computing, where it literally records everything around you all the time — video, your conversations. He wants to get to where it’s like a pendant around your neck. We also have a company called Jawbone that makes peripherals for smart phones and tablets. Today, they sell Bluetooth headsets and speakers, but soon they will sell all kinds of wearable computing devices.

Will we soon be dealing with antigaming laws so that drivers can’t play wearable video games while driving down the highway?

That assumes they’re driving. Google is working on self-driving cars, and they seem to work. People are so bad at driving cars that computers don’t have to be that good to be much better. Any time you stand in line at the D.M.V. and look around, you’re like, Oh, my God, I wish all these people were replaced by computer drivers. Ten to 20 years out, driving your car will be viewed as equivalently immoral as smoking cigarettes around other people is today.”

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Gordon Bell records his whole life:

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