intermediation platforms, political challenges

Dice - Frénot & Grumbach 1

Intermediation platforms political & geopolitical challenges

Stéphane Frénot Stéphane Grumbach

INRIA

Wednesday 9 April 14

Dice - Frénot & Grumbach 2http://www.csc.com/insights/flxwd/78931-big_data_universe_beginning_to_explode 1

DATAAn exponential growth

Eric Schmidt:

Every 2 Days We Create As Much Information As We Did Up To 2003


http://www.csc.com/insights/flxwd/78931-big_data_universe_beginning_to_explode


Dice - Frénot & Grumbach 3http://www.csc.com/insights/flxwd/78931-big_data_universe_beginning_to_explode 1





Big Data, Big Promises?Google Flu trends



Big Data, Big Promises?

Open Data

Government transparencyIncreased democracyBusiness potential

European Directive PSI 2013/37



Data a resource?

http://www.ibmbigdatahub.com/infographic/big-data-new-natural-resource 1


http://www.ibmbigdatahub.com/infographic/big-data-new-natural-resource

http://www.ibmbigdatahub.com/infographic/big-data-new-natural-resource


Data vs crude oil

Institut des sciences de la communication, CNRS 1

Largest market capitalization

2008 2013



Towards a complete digitalizationLarge variety of data



Harvesting of personal dataMostly performed through

Intermediation platforms

Intermediation

• between users with common interests

• between users and services

• between services



Facebook? a new world!

A social gatekeeper1 billion users130 billions friend links2.45 billion piece of content shared daily350 millions pictures uploaded daily

An ecosystem for the industrystorage, authentication, communicationmillions of Apps developers on the API9 million Apps active



Intermediation Platforms

Efficient association between producers/consumers of data and services

Activity monetization

Knowledge extraction from users activity

All 30 top sites worldwide

#1 sitetraffic 10 times #15



Intermediation PlatformsVirtual Empires

International Challenges






#64Top European site:

BBC

ID

Identity management

TERMS OF USE

money law

virtual territories fiscal employment

defense

12 3

USA, absolute world leaderChina, Emerging global powerEurope, Periphery of the network

Biface Systems

FREE ACCESS

BUSINESS

Organic behavior

Profiled behavior

Web ranking

Users' profile

New Economic Models

professionals algorithms users



Biface Organic Systems

FREE ACCESS

BUSINESS

Organic behavior

Profiled behavior

Web ranking

Users' profile



Biface SystemsTwo types of users with different pricing policies

• Credit card (merchants, clients)

• Mobile telecom (callers, receivers)

Online systems

• Free rider users

• Customers (advertising, ...)

Multi-face systems: various types of users



Secondary data: user activity

Secondary activity: User profiling

Primary data: Web pages

Primary activity: Web ranking

FREE ACCESS

BUSINESS

The case of the Search Engine



Secondary data: user activity

Secondary activity: User profiling

Primary data: Web pages

Primary activity: Web ranking

FREE ACCESS

BUSINESS

Tertiary data: system monitoring

Tertiary activity: test, influence



From primary to derived data

Primary data:

Produced by users and their services

Open with tunable restrictions

Secondary data:

Derived from traces, activity

Exclusivity of the platform (current business model)

Tertiary data:

Activity of the system

Organic behavior of the system


Dice - Frénot & Grumbach

The challenges of the industry

18

First challenge: capture users and datascale up as much as possible

Second challenge: capture developers and Appsstay as open and adaptive as possible

Third challenge: generate (undisclosed) secondary datacapture added value (business model)


Dice - Frénot & Grumbach

Size matters exponentially

19Thanks to François Bourdoncle

number of users of a search engine

=> traffic ➚

=> interest of advertisers ➚

=> word auction prices ➚

=> relevance (because of price) ➚

=> probability of successful click ➚

=> word covering ➚

=> monetization covering ➚

http://www.wordstream.com/blog/ws/2011/07/18/most-expensive-google-adwords-keywords





Relying on a few mobile operating systemsiOS, Android

Library of Appsvery knowledgeable personal assistantlocation basedbanking, ...

Mobile services

http://techcubeconsulting.com/5-great-free-mobile-apps-for-businesses/





A world of agility

Built to adapt permanently vs. built to last for ever

4Wednesday 9 April 14


A world of agility

Based on Japanese concepts from toyotism

4

• Kaizen (改善): Continuous improvement

• Genchi Genbustu (現地現物): Go and See

• Nemawashi (根回し): Keep all options

• Hansei (反省): Learning organization

• heijunka (平準化): Create continuous process flow to bring problems to the surface

• Kanban (看板) Use visual control so no problems are hidden


http://en.wikipedia.org/wiki/Nemawashi

http://en.wikipedia.org/wiki/Nemawashi

http://en.wikipedia.org/wiki/Hansei

http://en.wikipedia.org/wiki/Hansei










BBC

ID

Identity management

TERMS OF USE

money law


defense

12 3


Biface Systems

FREE ACCESS

BUSINESS

Organic behavior

Profiled behavior

Web ranking

Users' profile

New Economic Models




New Economic Models




Professionals offering

places to stay

Users seeking

places to stay



Users offering

places to stay

Users seeking

places to stay



1) between users and services2) between users/services

Intermediation platforms are new utilities

“Facebook is not cool” Mark Zuckerberg

A utility much like electricity, ...

Intermediation



Uninterruptible systemsAmazon / eBay / Walmart

• 1 click

• 1 hour delivery

28

Twitter Firehose:

• 300 k QPS

• 22 MB/s tweets that generates 57 TB / month

• Users get tweets in less than 5s (10s in 2011)

• Continuity, Immutability, Incoherency



Uninterruptible systems



Instantaneous Interactions

• 1/10th sec for Amazon leads to 1% drop in sales

• Google 0,5s latency brings down the traffic1/5th

• 10 links per page is the best size for google responses to queries



A/B Testing (Dan Siroker)


Dice - Frénot & Grumbach 34http://androidcommunity.com/google-posts-10-6-billion-in-revenue-for-q1-2012-20120412/http://video.cnbc.com/gallery/?video=3000118210

$50 billion in 2012

“Google is a Vacuum cleaner for revenue”

Barry Diller


http://androidcommunity.com/google-posts-10-6-billion-in-revenue-for-q1-2012-20120412/

http://androidcommunity.com/google-posts-10-6-billion-in-revenue-for-q1-2012-20120412/

http://video.cnbc.com/gallery/?video=3000118210

http://video.cnbc.com/gallery/?video=3000118210


Facebook revenue forecast

http://www.wired.com/business/2012/10/facebook-case-for-optimism/?utm_source=twitter&utm_medium=socialmedia&utm_campaign=twitterclickthru













BBC

ID

Identity management

TERMS OF USE

money law


defense

12 3


Biface Systems

FREE ACCESS

BUSINESS

Organic behavior

Profiled behavior

Web ranking

Users' profile

New Economic Models





#64Top European

site: BBC

12 3



Dice - Frénot & Grumbach 38Wednesday 9 April 14


Online Population



Web content language

http://en.wikipedia.org/wiki/Languages_used_on_the_Internet





The Top 50 websites worldwide

• USA: 72 %

• China: 22 %

Baidu: 5; QQ: 7; Taobao: 9; Sina:13; hao123:16; weibo:17; tmall:23; Sohu:27; 360.cn:28; 163.com: 34; Soso:37;

• Russia: 6 %

Yandex: 20; kontakte:21; Mail: 39;

6 %

22 %

72 %

USA China Russia



Top 10 websites in the USA

Global traffic combination of average daily visitors and page views over the past month in million

www.alexa.com & www.trafficestimate.com


http://www.alexa.com

http://www.alexa.com


Global tracking

Proportion of trackers in different countries

Joint work with Claude Castellucia & Lukasz Olejnik



Percentage of national web corporations

among Top 25 by country

Data produced by users everywhere in the worldbut accumulated by corporations most often abroad

• USA: 100%• China: 92% (only Google makes it in the top 25)• France: 36% (but mostly marginal sites, not data intensive)

leboncoin, Orange, Free, commentcamarche, lemonde, lequipe, lefigaro, pagesjaunes, sfr

Alexa.com



Top 20 websites in France



Data balance for selected countries

for Top 10 sites



Traffic Top 10 sites in selected countries



Diversity of search engines

• USA: Google: 65 % ; Bing: 15% ; Yahoo: 15%

• China: Baidu 63% ; Qihoo 22%; Sogou: 11%• Russia: Yandex: 60% ; Google: 25%

• UK: Google: 91 % ; Bing: 5%

• France: Google: 92 % ; Bing: 3%

In France, • Google has a de facto monopoly• Google knows more about France than INSEE


Dice - Frénot & Grumbach 50http://www.techinasia.com/how-baidu-qihoo-google-performed-in-china-in-2013/

The dynamism of China


http://www.techinasia.com/how-baidu-qihoo-google-performed-in-china-in-2013/


Dice - Frénot & Grumbach 51http://www.techinasia.com/how-baidu-qihoo-google-performed-in-china-in-2013/

Rapid evolution of the landscape





Data as an economic indicator?

OECD Key economic indicators

• International Trade• Balance of Payments• Monetary Aggregates• Interest Rates• International Finance• National Accounts

Data exchange ???


http://stats.oecd.org/mei/default.asp?lang=e&subject=12





















BBC

ID

Identity management

TERMS OF USE

money law


defense

12 3


Biface Systems

FREE ACCESS

BUSINESS

Organic behavior

Profiled behavior

Web ranking

Users' profile

New Economic Models




Virtual Empires

ID

Identity management

TERMS OF USE

money law


defense



Facebook’s territory



Identity management

Id given to any person

Real name systems

Authentication to services

private & public

Unique Id for all services



Legal system

The same principles everywhere in the world

contracts users/corporations

Local adaptation to specific regulation



Virtual monetary system

56

Money independent of Central Banks

Taxation at stake with non monetized transactions

Bitcoin: virtual currency with no centralized control

http://www.nytimes.com/2013/04/08/business/media/bubble-or-no-virtual-bitcoins-show-real-worth.html?nl=technology&emc=edit_tu_20130408







Global governance

Public Open Data

Made accessible by public administration

Open by default (G8)

Managed on large platforms (Github?)











BBC

ID

Identity management

TERMS OF USE

money law


defense

12 3


Biface Systems

FREE ACCESS

BUSINESS

Organic behavior

Profiled behavior

Web ranking

Users' profile

New Economic Models


Thanks to Sophie Barbier for graphical design
