Net Gains

New York's Flatiron district, main street of Silicon Alley.

CITY JOURNAL
Winter 2014

Net Gains
by James Panero

Silicon Alley rises again.

Starting up in 2011 as a cross between a for-profit vocational school and a caffeinated tech clubhouse—with open co-working space mixed with classrooms, break rooms, and broadcasting studios—General Assembly now has campuses spanning nine cities on four continents, all offering a “pragmatic and multidisciplinary education at the intersection of technology, design, and business.” In New York, where it occupies two loft floors along the former Ladies’ Mile at 21st Street on either side of Broadway, GA is a feeder school for the city’s burgeoning tech industry. Much like the 34,000-member New York Tech Meetup, a nonprofit organization that hosts monthly events at New York University, and Techstars NYC, a mentorship and seed accelerator for new tech firms, GA seeks to strengthen network ties within the New York tech community, while providing an environment entirely unlike the sprawling office parks of Silicon Valley.

“What makes New York so interesting as a tech hub is that technology and design are now intersecting with so many different industries,” says Matthew Brimer, GA’s 27-year-old founding partner. “New York is already such a big commercial hub,” he says. “So many industries have amazing creative business talent. Take a place that is super dense with these different types of talent, bring those people together, and they can start to transform these different industries—that’s a perfect petri dish for interesting stuff to happen.”

Gotham’s tech sector keeps finding ways to make interesting stuff happen, showing surprising resilience even as the New York economy has had its ups and downs during the Bloomberg years. Since 2007, billions of dollars have poured into New York’s “Silicon Alley,” which recently vaulted ahead of the greater Boston area to become the nation’s second-largest tech hub behind California’s Silicon Valley. For a city that has long relied on its financial industry to spur growth and innovation, the resurgence of the tech sector is welcome news.

In just a few years, “New York’s tech sector has emerged as an increasingly powerful economic driver for the city,” wrote authors Jonathan Bowles and David Giles in “New Tech City,” a May 2012 report for the Center for an Urban Future. “At a time when few other industries were growing in New York, more than a thousand new tech start-ups were formed in the city.” This influx of capital and tech talent has pumped new life into New York City’s economy. Data from the New York City Economic Development Corporation (EDC) showed that there were 90,273 people working at 7,147 high-tech companies in New York in 2010—a 30 percent increase from 2005. Using the Bloomberg Technology Summit’s broader definition of a “tech/information sector,” New York has 262,000 workers in the industry, accounting for $30 billion in wages—and the sector added 11,000 workers in 2012.

According to a MoneyTree report published by PricewaterhouseCoopers and the National Venture Capital Association, the New York area also saw a 32 percent jump in venture-capital deals from 2007 to 2011—the only increase for any U.S. region. Some of these start-ups have already been acquired by larger firms; the microblogging platform Tumblr, for example, founded in 2007 and based on East 21st Street, gained $125 million in funding before being purchased last year by Yahoo for $1.1 billion. Others continue to raise funds as private companies: the online retailer Fab.com, founded in 2010 and based in Greenwich Village, has raised $336 million; the online shopping club Gilt Groupe, founded in 2007 and based in Midtown South, raised $221 million; the online medical-scheduling service ZocDoc, founded in 2007 and based in SoHo, raised $95 million; the location-based social-networking site Foursquare, founded in 2009 and based in SoHo, raised $112 million; and the arts and crafts commerce platform Etsy, founded in 2005 and based in Dumbo, raised $91.7 million. Chelsea-based virtual-journalism firm BuzzFeed raised $46 million.

It’s not the first time that tech has surged in New York, but this new crop of tech entrepreneurs is making smart use of an old tool—the brick-and-mortar density that has nurtured entrepreneurship in the city since the early eighteenth century. The urban experience promotes unplanned encounters, often resulting in a mutually enriching phenomenon known as “knowledge spillover.” Multiple industries tie into the city’s tech revival: advertising, fashion, publishing, retail, art and culture, finance, and food constantly retool their traditional businesses with online technology. Unlike the hardware and computational focus of West Coast tech, Silicon Alley is focused on exploiting synergies among the entrepreneurs, artists, developers, and dreamers who live and work in the Big Apple.

Today, the tech landscape is different from in the 1990s, in ways that favor New York City’s native strengths. In the past, Silicon Alley relied heavily on expensive traditional advertising campaigns to sell products that often required millions of dollars—for everything from server racks to programmers—just to get up and running. But many of the components that start-ups need today are readily available, in part because the commercial Internet has evolved since those pioneering early days. Coding can be done remotely, with work bid out to programmers in India and former Eastern Bloc nations. Inexpensive, off-the-shelf solutions exist for a variety of once-costly and challenging problems. A viable app can be created in weeks for under six figures. Indeed, apps, which provide virtual solutions to real-world problems, neatly illustrate New York’s trademark blend of creativity, commerce, and technology. It’s no surprise that apps have been a particular focus of this latest iteration of Silicon Alley.

For years, critics have predicted that technology—particularly communications technology—would replace the face-to-face interactions that city life facilitates. Yet in a 1996 paper for the National Bureau of Economic Research, Jess Gaspar and Edward Glaeser (a City Journalcontributing editor) showed how historical advances in communications technology have, in fact, increased the need for direct human contact. The telephone, for example, extended a person’s network of connections, which, in turn, fed the need for more face-to-face interactions. Further improvements to communications technology, Gaspar and Glaeser concluded, would foster ever-larger networks, leading to ever more face-to-face exchanges. These days, technological advances have cut down on development costs and vastly expanded connectivity, and what Gaspar and Glaeser prophesied in 1996 is coming to pass in Silicon Alley.

Indeed, if the nineteenth century saw New York mapped out in two dimensions, through the Commissioner’s Plan of 1811, and the twentieth century saw New York take on a third dimension, through the development of the skyscraper, the twenty-first century, through the Internet, is rapidly mapping Gotham into a fourth, virtual dimension. New York’s latest generation of tech entrepreneurs has found success by extending the city’s real-world, three-dimensional space into an increasingly complex network, where real, virtual, and mobile density all integrate together.

Departing mayor Michael Bloomberg deserves credit for helping to expand New York’s tech economy. During his three terms in office, he made improving technology education a priority. “Since the 2008 financial crisis, no other industry has enjoyed more attention from the Bloomberg administration than tech,” wrote Bowles and Giles. The EDC has supported tech incubators and shared work spaces from the Bronx to Brooklyn. In 2011, Bloomberg named Rachel Sterne Haot New York’s first chief digital officer to oversee the city government’s web accessibility and serve “as an advocate for the digital media industry.” Bloomberg himself was one of New York’s original tech successes. In 1981, he was forced out of his position as a general partner at the investment bank Salomon Brothers. With his severance package, he set up a company to sell high-quality business information to Wall Street via computer technology. In 1987, his Innovative Market Systems became Bloomberg L.P.

The Bloomberg administration’s biggest investment in the city’s future as a tech hub occurred in 2012, when it awarded $100 million and 11 acres on Roosevelt Island to Cornell University and the Technion–Israel Institute of Technology to build a 2 million-square-foot campus called Cornell NYC Tech. Construction is scheduled to begin this year and will continue through 2037, according to Cornell, with the campus opening in 2017. At full capacity, by 2043, the campus will have room for 2,500 graduate students taught by a 280-person faculty. The city has also announced plans for a new tech campus for NYU in downtown Brooklyn. It broke up the failing Paul Robeson High School in Crown Heights to create the Pathways in Technology Early College High School (P-TECH), a partnership between the Department of Education, City University, and IBM that offers a six-year curriculum for high school students, leading to an associate’s degree in applied science and an inside track to employment at IBM. And the city has partnered with the venture capitalist Fred Wilson to create a new Academy for Software Engineering inside the failing Washington Irving High School, one block from Union Square. This past year, 1,400 high school students applied for its 125 slots. The city is rapidly developing an additional Academy for Software Engineering in the Bronx and rolling out a pilot program in 20 middle schools and high schools, offering computer-science classes in coding, web design, and 3-D printing.

Ensuring the health of New York’s maturing tech industry will require strengthening the city’s real-world Internet infrastructure and tech “ecosystem,” say tech-industry leaders. They want to see improvements to the city’s broadband pipes and, in general, a New York more fully integrated into the tech economy. New York’s lackluster broadband infrastructure is limiting growth in outer-borough neighborhoods. “Look at Kansas City, where they’ve got Google Fiber,” says tech entrepreneur Jack Hidary, referring to Google’s initiative to lay the pipelines for an Internet 100 times faster than cable-modem broadband. “It is a great case study, and has seen a tremendous influx of entrepreneurship. The lesson we need to learn from that is that broadband needs to be available across the five boroughs, not just in Midtown Manhattan.”

Sorry, Writers, but I'm Siding With Google's Robots

THE WALL STREET JOURNAL
February 8, 2014

Sorry, Writers, but I'm Siding With Google's Robots
by James Panero

Copyright laws too often stifle the creativity they claim to protect. Time for a 21st-century update.

How much did mention of "copyright" increase in American books published in the second half of the 20th century? The answer is by nearly a factor of three. How about "intellectual property," a neologism designed to equate copyright with real property? By a whopping factor of 70. But what about "public domain," the term for our creative commons where the arts are replanted and renewed? The answer is almost not at all.

We know this thanks to a new program called Ngram, an offshoot of Google Books that analyzes the metadata of what is now the world's most extensive literary index. Ngram gives us a sense of how ideas have circulated over the past 200 years. And when it comes to creative freedom, the numbers don't look good.

Since the 1970s, U.S. terms of copyright have been extended and tightened at the behest of the film, music and publishing industries in a way that hurts how we can enjoy, share, study and repurpose culture. Don't believe me? When was the last time you saw Martin Luther King's "I have a dream" speech on television in full? As a copyrighted work zealously guarded and monetized by the King estate, it's still rarely shown.

Technology companies have emerged as the key counterweight to the lawyers and lobbyists of the content giants. And that's one reason November's victory for Google Books in Authors Guild v. Google is important.

In 2004, Google announced a partnership with Harvard, Stanford, Oxford, the University of Michigan and the New York Public Library to begin scanning their holdings, turning the printed pages of millions of books into digital grist for its search mill. The robot scanners ran their eyes over everything, from books in the public domain to copyrighted material, which under current law includes most of what's been published since 1923. The results have been a boon to the culture of ideas.

Yet since Google never tracked down the millions of rights-holders of more recent works, the initiative has been embroiled in litigation over copyright infringement since its inception—even though Google has used copyrighted books only for its search index (as opposed to showing the full text). The Authors Guild, one of the plaintiffs against Google, declared the scanning "exploitation" and a "hazard for every author." U.S. Circuit Judge Denny Chin in Manhattan disagreed and dismissed the group's claims after eight years of litigation, declaring Google's project a "transformative" fair use. The Authors Guild has vowed to appeal.

As a writer, I'm siding with the robots. Google Books is far from perfect: Even advocates have worried about the consolidation of scanned information, fearing it will lead to a new digital monopoly. But it brings literature into the online world, exposing a younger generation to books they otherwise would never encounter.

Google Books' legal victory can also be seen as a chink in the armor of ironclad copyright laws. Copyright was never meant to be an indefinite "intellectual property." Article I, Section 8 of the U.S. Constitution gives Congress the power "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." Much like patents, copyright was a utilitarian measure to protect creative work through a temporary government-granted monopoly.

For the founders, that meant a protective period of 14 years with the right of renewal for another 14. Since then, and especially over the last three decades, the terms have exploded. For self-made work, copyright is now in effect for the life of the author plus 70 years. For work-for-hire, the terms are 95 years after publication or 120 years after creation, whichever is shorter.

In Congress, the terms have tended to have the curious ability to grow just as Mickey Mouse is set to exit copyright, effectively locking down America's cultural patrimony to protect Disney. The "Copyright Term Extension Act" of 1998 is commonly derided as "The Mickey Mouse Protection Act," since it extended Disney's control of the cartoon character for another 20 years. The motion picture industry has argued for even more—a perpetual copyright, or "forever less one day." But would this actually be good for the arts? Numerous studies, such as a 2007 analysis by economist Rufus Pollock at Cambridge, have shown that far shorter terms would maximize creative output.

Considering the Democratic Party's ties to Hollywood, Republicans should be the natural leaders on intellectual property reform. Conservatives such as Reihan Salam, Patrick Ruffini, Timothy P. Carney and Jordan Bloom have argued convincingly for it—but so far the party isn't listening. When Derek Khanna, a young policy analyst, wrote a white paper in 2012 for the Republican Study Committee on rolling back copyright, he was shown the door. "The Republican Party hasn't been pro-innovation," he explained to me. "Copyright reform is a vital component of a more forward-leading platform."

At the start of 2014, Duke Law School's Center for the Study of the Public Domain published a list of books that would be entering the public domain under the laws that existed through 1978. For works ranging from Jack Kerouac's "On the Road" to Dr. Seuss's "Cat in the Hat," "you would be free to translate these books into other languages, create Braille or audio versions for visually impaired readers . . . or adapt them for film." Too bad: Under current law, you can't.

"Poetry can only be made out of other poems; novels out of other novels," wrote the critic Northrop Frye. "Literature shapes itself, and is not shaped externally." The freedom to work with a renewed public domain should be our inheritance—if only we stopped Mickey Mousing around with copyright.

At the Internet Archive, Saving Data While Spurning the Cloud

Brewster Kahle, founder of the Internet Archive (all photographs by the author for Hyperallergic)

HYPERALLERGIC
December 4, 2013

At the Internet Archive, Saving Data While Spurning the Cloud
by James Panero

SAN FRANCISCO — At 3:30 am on November 6, a fire swept through the scanning center of the Internet Archive. The news was poignant for an organization that thinks hard about how information is lost and the best ways to save it. For nearly two decades, the San Francisco nonprofit has been uniquely dedicated to the open preservation of web, text, coding, audio, and video media — a Library of Congress for the 21st century built through private philanthropy and sweat equity. None of the Archive’s employees or volunteers were hurt in the blaze, but the fire totaled the Archive’s annex building along with $600,000 in digitization equipment and some irreplaceable archival material. An emergency appeal brought in $60,000 over its first two days, and the drive is ongoing.

“This episode has reminded us that digitizing and making copies are good strategies for both access and preservation,” wrote Brewster Kahle, the Archive’s founder and director, on the organization’s blog the day of the fire. Thanks to the Archive’s mirrored servers — spread over three continents — and a warehouse of hard-copy source material, Kahle said the Archive’s digital data would have survived even if its headquarters had been fully destroyed. “Let's keep making copies,” he concluded. (The virtue of the Internet’s duplicating qualities is a topic I wrote about in an essay called “The Culture of the Copy.”)

How libraries endure was on Kahle’s mind when I visited the Archive in San Francisco’s Richmond District earlier this year. “What happens to libraries is that they’re burned,” he said. “They are generally burned by governments. The Library of Congress, for instance, has already been burned once, by the Brits. So if that’s what happens, well, design for it, make copies.”

Internet Archive servers in the Christian Science building that houses the organization in San Francisco

Kahle now has the resources to make copies on a grand scale. The Archive recently surpassed 10 petabytes of data (they printed bumpers stickers to mark the milestone). The nonprofit costs $12 million a year to run: about $5 million of that comes in from libraries paying 10 cents a page for digital scans, $2 million comes from national and local libraries paying for archival services, and about $5 million comes in from foundations. “I am the funder of last resort,” says Kahle. “I won the lottery, the Internet lottery, so I can plug in when it doesn’t come through.” Even before Kahle sold his company Alexa Internet to Amazon in the late 1990s, he had focused on preserving digital information through duplication. “If the Library of Alexandria had made copies, and put them into either India or China, we would have the other works of Aristotle, the other plays of Euripides.”

A “scribe” works at one of the book digitization stations damaged in the fire

In 2009, Kahle moved the Archive headquarters into a former Christian Science church where it operates today. The collonaded facade of the classical building suited Kahle’s Alexandrian aspirations (the Archive has also partnered with the revived Bibliotheca in Alexandria, Egypt). “We bought this building because it matched our logo,” he told me. The basement meeting room became the Archive’s open-plan office, halfway between a tech hub and a student commons. Over a long table where Kahle invited me to join the Archive’s Friday lunch, the office breaks bread with whomever Kahle finds interesting. On the day I visited, Kahle introduced himself by dropping a black box in my hands — an inexpensive hard drive that could store a library’s worth of books and be widely distributed. My other seatmate was a crunchy bookseller from a San Francisco commune.

Upstairs, the church’s large sanctuary remains unchanged save for a few modifications. In the pews are statues of the Archive’s longterm workers. “It’s kind of a riff on the terracotta soldiers idea,” Kahle explained. “If you work at a non-profit there is no gold at the end of the rainbow. There’s no stock options. So this is sort of a way of saying thanks.” In front, the hymnal numbers have been replaced by the numbers for Pi and Phi. In two apses at the back are racks of blinking servers. “That is 2.5 petabytes of the primary copy of the Internet Archive.” Upstairs, in the church’s old offices, are the Archive’s additional primary servers. “The idea of having your data in an off-site location center, or in the ‘cloud,’ wherever the hell that is, strikes me as an insane idea. If it’s really important to you, keep it close to you.” Kahle said the Archive follows its own server design. “To buy something from Dell, HP, Sun, whatever — their profit margins are so unbelievably huge and their products so bad that it actually was better to design and build our own.”

Statues of long-time Internet Archive staffers recall terracotta soldiers

Mixed in among the servers is the Archive’s one-room schoolhouse for Kahle’s teenage son, Logan. “This is a classroom for one student and one teacher,” Kahle said as we walked by. “We are experimenting with one-on-one teaching. Logan wanted to learn differently and faster than what he was able to do in private school.” Kahle argued that his stripped down approach is economically more efficient than a private school with its administration and overhead costs.

For someone who made his fortune off the Internet, Kahle has an unexpected off-the-grid mindset. His sense for multimedia survivalism took off when he realized the technology existed to do what might sound impossible: through the right software and storage, to take a snapshot of the entire open Internet every two months. The public face of this effort became “the Wayback Machine,” the free online interface that allows anyone to search the Archive’s database that at last count boasted “368 Billion web pages saved over time.” What Kahle calls “an out-of-print web pages service” is now used by about 600,000 people a day and is the Archive’s most recognizable feature.

Yet the Archive’s reach now goes beyond the web to the preservation of a broad range of media. “We started collecting television,” Kahle said. “The Library of Congress is supposed to, but they weren’t. Twenty channels of television 24 hours a day.” Last year, the archive created a searchable video database of television news. “We’d like to make everyone into a Jon Stewart research department, so you can basically reference and compare and contrast what it is that has been on television.”

A film digitization station.

The digital Archive includes recorded audio (with nearly 9,000 live concert recordings of the Grateful Dead), vintage software and gaming code, old public service messages and video captures of ghostly home movies, and a vast library of scanned books, which can either be digitally loaned or downloaded depending on copyright. Here Kahle wants to create an archive similar to Google Books but “without having centralized control.” While he has praised the recent fair use summary judgement in favor of Google Books over The Authors Guild, Kahle has been critical of Google’s proprietorial control over its own scanned archive, as well as the quality that results from its robotic scanners. “We actively encourage people like Aaron Swartz to go and download millions of books at a time,” he says of his own scans. “We publish tools on how to do it.  This is what libraries are for.” It was the book and video scanning building, where I saw young employees and volunteers hunched over rows of stations labeled “scribes,” that burned on November 6.

For all his faith in digital technology, Kahle believes in keeping hard copies. While other libraries may scan their contents in order to reduce their paper storage costs, sometimes “de-accessioning” books to pulping mills, Kahle has created an offsite storage vault where he hopes to keep a copy of every published book available, which he estimates to be 10 million copies. Much like the Svalbard Global Seed Vault buried in the permafrost of Norway, what he calls “The Physical Archive of the Internet Archive” already stores 500,000 copies in climate-controlled shipping containers along with other hard copy assets such as the Archive’s old servers — all there for future needs or an archive of last resort in a doomday destruction of the digital database.

“I have more faith right now in the Wikipedia generation than I do in the institutions that get all the funding, whether they be universities, libraries, museums. The bottom up generation is building the real infrastructure,” Kahle said.

“So how come you’re not the Librarian of Congress?” I asked.

“He’s still alive,” Kahle responded, as he moved on to point out the next rack of servers.

A panoramic view of the Internet Archive offices in San Francisco (click to enlarge)