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inkl Originals
inkl Originals
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Tom Wharton

The Weekly Wrap for Saturday, 24 March 2018

One to ponder: If you brought US$100 worth of Venezuelan bolivars in April 2013, how much would they be worth today? (Read to the bottom for the answer.)
DEEP DIVE
The Cambridge Analytica (CA) story this week had it all: privacy breaches, election interference, propaganda and even undercover videos. The headlines all week have focused on some of the most salacious and devastating admissions. For example, CA's coder-cum-informer Christopher Wylie memorably described his work there as building "Stephen Bannon's psychological warfare mindfuck tool". 

But behind all the short-lived hysteria you see right now is a growing realisation that what Cambridge Analytica did may well appear to be exceptional right now, but all too soon it might be the rule. 
Christopher Wylie has blown this story wide open. PHOTO: The Washington Post
Puppets and braggadocio 
It's difficult to know where to start with CA. The recorded admissions that the company influenced elections in the United States, Kenya and Nigeria? Its genesis in the shadowy world of lobbyists and political operatives; weaned on Richard Mercer's billions? Facebook CEO Mark Zuckerberg's anodyne apology for the fact that his company allowed years of user data to be harvested? Or perhaps the growing call for Facebook to be burdened with more regulatory oversight, or even to be forcibly restructured?

Feel free to scroll back up here to explore all these topics at your own leisure. But for now we're exploring why we shouldn't really be all that surprised about the CA revelation, and why we should expect more of the same. It all starts with a decades-long quest by marketers to build personalised ads. 

The 'segment of one'
This is the holy grail for marketers. In the parlance of the profession the 'segment of one' (or, hyper-personalisation') refers to the delivery of a tailored marketing message to each consumer. And it consists of two key ingredients: the ability to build complex and rich profiles of each consumer, and the capacity to deliver ads to that consumer in disarming ways.

A century ago John Wanamaker, a pioneer in Marketing, said "Half the money I spend on advertising is wasted; the trouble is I don't know which half." Fast-forward ten decades and today the heady mix of mobile internet connectivity, smartphones and social media platforms is giving shape to what was once a pipe-dream. This current scandal shows just how close marketers are to achieving that 'segment of one'. CA boasted that it had 5,000 data points on every voting-aged American.

Cookie-cutters to track cookies
Breakthroughs in communication technologies over the last century have afforded marketers dazzling new opportunities. Yet all mass marketing - whether on radio, television or mobile -  is by virtue of its reach prescriptive. It's a one-size-fits-all approach that consumers have become attuned to: we see ads and instantly register that there is a company trying to sell a product or service. It's exactly this evaluative response that marketers are now trying to circumvent. To quote another famous ad man, David Ogilvy, "A good advertisement is one which sells the product without drawing attention to itself."

Now consider this, if you have a rich-enough data profile of your prospective customers - their shopping habits, their beliefs, their weaknesses, their tastes, and even their fears - you can craft subtle-enough (or, perhaps, agreeable-enough) messages that slip under their radar and embed themselves in their minds. Witness for example the case of Elgar Welch who turned up and fired shots at a DC pizzeria in the brainwashed belief that it was the site of a child-sex ring. 

Backtracks and admissions
The outcome described above was not accidental - it was the result of messages that were intentionally manipulative. Manipulation that CA strove for, and was paid for. We would call this propaganda if it was, say, the National Security Agency's cyber warfare division that was in the spotlight rather than Facebook.

In a particularly offensive Twitter post CA staff wrote, "Advertising is not coercive; people are smarter than that." But coercion is in fact at the heart of targeted advertising: contrary to the notions of choice in a consumer society, success for marketers is fast becoming a question of whether they can make the decision for you. We can't put this any better than CA themselves did. In their brilliant expose the UK's Channel 4 News secretly filmed CA executive Mark Turnbull touting his wares. In his own words, "we just put information into the bloodstream of the internet... It has to happen without anyone thinking, 'that's propaganda', because the moment you think 'that's propaganda', the next question is, 'who's put that out?'."

While CA is deserving of whatever punishment comes its way, it would be a huge mistake to simply scapegoat the company. It isn't an outlier, it's just an aggressive company pushing the envelope. 

The new normal
This genie isn't going back in the bottle. Given the alleged efficacy of CA it's hard to see why unscrupulous players wouldn't emulate these methods. Nor is it clear that Facebook's ever expanding effort to garner information about its users will be satisfied. The 50 million data profiles (we know of so far) that CA harvested from Facebook are just the beginning. As Bannon himself alleged yesterday, "Facebook data is for sale all over the world."

What's interesting about this latest episode is that profile-based manipulation has now entered the domestic political arena in the US. Political manipulation has long been in the arsenal of organisations like the CIA tasked with making mischief in foreign lands. Now this same power is in the hands of political lobbyists and the weapons are aimed not overseas but at home. 

We must wait to see whether this moment of reckoning is heeded; or whether marketers, campaign managers and propagandists continue their headlong tumble toward 'segment of one' targeting. At inkl we've got a fair idea of which is the more likely. 

 
WORLDLYWISE
The aftermath of the chase . PHOTO: AP
The increasingly desperate manhunt for the Austin parcel bomber reached its gruesome conclusion on Wednesday when the primary suspect blew himself up to avoid capture. Over the course of three weeks Conditt paralysed the Texan capital with a string of mailed explosives that killed two and injured six. Officials have warned residents to remain vigilant for any explosives that may have been mailed before Conditt took his own life.

Conditt was young, listless, unemployed and nominally conservative. A blog alleged to be his outlines middle-of-the-road reactionary beliefs (opposing free abortions and same sex marriage; supporting the death penalty). He was home-schooled, failed to complete university and had been unemployed for a year after being fired from his last job.

In a 25-minute recorded confession found by the police Conditt was entirely unrepentant for the lives he took. He also threatened to blow himself up in a crowded McDonalds if the police got too close. Yet rather than acknowledging the suburban mediocrity that leads so many young white American men to extreme violence, much of the local coverage has made excuses for him. This tragedy again raises questions about the stark disparity between the media's treatment of white and coloured extremists in the US.
Applause at the African Union while Wall Street plunged. PHOTO: AP
Yesterday African Union leaders announced the formation of a continent-wide free trade agreement. The president of host-nation Rwanda - Paul Kagame - outlined the progress made in opening up intra-African trade: some 44 countries have signed up so far. While the two largest African economies (South Africa and Nigeria) are yet to ink the deal, the current bloc accounts for some 1.2b people and $3t worth of trade. Hopes are high that the deal will begin the process of unknotting Africa's complex and at times arbitrary border controls.

That countries at one end of the development spectrum are pursuing free trade zones while America at the other end fights a trade war is alarming. 

This week the White House announced $50b worth of new tariffs on Chinese goods in retaliation to intellectual property theft by Beijing. While the American president prosecutes his promised (and ill-advised) campaign against China, the rest of the world is preparing for the backlash. Global markets closed shakily after the Dow Jones, Nasdaq and S&P 500 all shed more than 2% in value on Thursday.
WHAT ELSE HAPPENED
Nauseating scenes from the blast site. PHOTO: AFP
  1. 32 Afghan Shias were killed and dozens more wounded when an ISIS suicide bomber targeted a procession marking Persian New Year
  2. Former French President Nicolas Sarkozy has denied allegations that his election campaign accepted millions from Libyan dictator Muammar Gaddafi, a man who Sarkozy later helped overthrow
  3. Uber received another fresh criticism after one of its self-driving cars hit and killed a pedestrian in Arizona; footage released by the police suggest the collision was avoidable
  4. Donald Trump ignored a written note from his staff ("DO NOT CONGRATULATE) and congratulated Russian President Vladimir Putin on his reelection
  5. Trump also sacked his National Security Advisor HR McMaster (by Twitter): replacing him with conservative war-hawk John Bolton
  6. Chinese leader Xi Jinping levelled a fierce challenge at Taiwan as tensions again rose over Beijing's claim on the island
  7. Turkish troops and allied militias seized the town of Afrin after Kurdish forces retreated amongst the 200,000 displaced civilians
  8. The European Union proposed a 3% tax on the gross revenue of Silicon Valley tech platforms based on where their users are
  9. European Union countries were expected to announce that they would expel Russian diplomats in support for Britain in the aftermath of the Salisbury nerve gas attack
  10. Yet another former South Korean president is facing jail time after Lee Myung-bak was charged with bribery (Lee was Park Geun-hye's predecessor)
THE BEST OF TIMES...
The winds of change. PHOTO: Getty
This week Britain's National Grid Control Room confirmed the highest ever contribution of wind power to the nation's electricity network. Renewable energy campaigners trumpeted the extraordinary results of 13.9 gigawatts generated by wind farms - thats 37% of the UK's power needs. The UK is steaming ahead in its efforts to bring more wind power online, bravo. 

Not content to rest on its laurels, Britain produced another absolutely stunning piece of good news this weekend: specialists at Moorfield hospital announced they had successfully returned sight to two blind patients! Both suffered from the most common form of sight-loss, age-related macular degeneration, and were cured with stem cell therapy. Extraordinary.
THE WORST OF TIMES...
The male of his species. PHOTO: EPA-EFE
We've nearly wiped out yet another species. Regular inkl readers will know that the world's last male Northern White Rhino - named Sudan - had been languishing in a Kenyan conservation park. This week he was euthanised following age-related complications. Poaching and deforestation killed off Sudan's species. The only hope left for it now lies in an IVF program for the two remaining females. 

There is a sad irony to the fact that in the week that marks the Iraq War's 15th anniversary, an advisor entered the White House this week with his gunsights aimed squarely at Iran. A decade and a half down the track from the swift invasion and disastrous occupation of Iraq there is still no reliable measure of the resulting death-toll. The most conservative estimates put the number at 600,000. Some groups put the figure in the millions.
 
P.S.
Your weekend long read... Here is another winner from the Financial Times. It is one of the most successful media companies in the world - so why is it so hard for Spotify to make money?

What we're reading... Hannah Arendt's seminal work "Eichmann in Jerusalem: A report on the Banality of Evil". The inimitable political theorist and philosopher reported on Adolf Eichmann's trial in the newly-minted state of Israel after his abduction in Argentina. It is a deeply moving and sharply written text with a message that is, in a word, timeless.

Factoid: At the top of The Wrap we asked you what US$100 worth of Venezuelan Bolivars purchased 5 years ago would be worth today.

One cent. Since Nicolas Maduro assumed power in 2013 the Bolivar has fallen 99.99% against the US dollar. Hopefully this puts into perspective just how dire Venezuela's economic collapse has been.
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