AirBnB, Bitcoin, Uber, and the Rise of Computational Trust

As reported by TechCrunch: How do you feel about letting strangers into your home? Our homes act as a kind of sanctuary from the outside world, a highly personal and exclusive refuge. They should be safe. While it is a commonplace in cultures throughout the world to be gracious hosts to guests, such warmth rarely extends to complete strangers at the door.

The notion that we would provide a room to those outside our kin seems remarkably alien, and yet, Airbnb would seem to have successfully changed this social norm. Today, as the company’s valuation can attest, it has found a way to facilitate these sorts of transactions on a global scale, across social classes and cultures.

A closer examination of this dynamic though, shows that there is more complexity here than meets the eye. Airbnb didn't approach this situation by resolving to make people more trusting, but instead, by making guests more familiar to their hosts, and vice versa. It developed reputation systems with symmetric feedback mechanisms so that guests and hosts can get to know each other before ever meeting, and it offers an insurance policy to limit any failures of its credibility model. Rather than creating a new culture of trust, it simply evaded the issue of trust entirely.

The story of Airbnb is a great parable about the changes happening to trust in our society. 
Driven by technology change, formerly untrusted transactions are easier to conduct than ever. A Bitcoin transaction doesn't require any information about the payer at all, unlike credit card transactions, and an Uber driver can be sure that a passenger is going to pay a fare with limited bad behavior. More than almost any other social change driven by startups, the invention of a “non-trusting” infrastructure is one of the most notable in the history of the internet.

Unfortunately, our heady delight at this increasing power for abstract commerce belies a challenge to the very culture that holds together human societies. In using products like Airbnb’s reputation systems and Bitcoin’s blockchain, we are increasingly relying on technology to facilitate trust between humans, rather than developing our own individual capabilities for fidelity. That may have limited short-term influence on the way our economy is structured, but in the medium to long-term, this transition risks undermining not just traditional commerce, but also areas like decision-making, politics, leadership, and normal social interactions.  

Trust is about expected behaviors, an assumption that another party is going to take actions as we would expect. The very concept of agriculture that allowed civilization to flourish was built around trust – trust that food was going to be produced, trust that it would be distributed and not hoarded, and trust that there was some way of procuring that food in a consistent manner.  

The history of economics, and really, the history of civilization, is the creation of institutions that allow us to increasingly abstract away that trust and minimize risk. Perhaps the most prominent example is currencies. When someone hands me dollars to pay for something, I only have to trust that this system of payments is going to work, irrespective of the payer’s credit or trustworthiness. Court systems and regulations work similarly to reduce risks of conducting business by (theoretically) making outcomes more predictable.

We have only talked about physical exchanges, but services have even more risk. When a taxi driver takes on a passenger at the curb, that driver is literally taking on a financial risk – will the person who just entered the cab be able to pay at the destination? When a software consultant finishes up a phase of a programming project, will they receive their income? 

Through social trust, laws, and regulations, our system has adequately worked to make these services possible. The passenger believes the driver will take him or her to their destination in the shortest way possible, while the driver expects that the passenger will pay and behave. 

Similarly, the software developer expects to get paid as the terms of their contract dictate.
Unfortunately, our society’s stock of trust has been declining. For Americans, our trust in institutions, measured through long-running polls like those at Gallup, show that we are hitting a nadir in our levels of trust. Such faith in institutions is decreasing elsewhere in the world as well. Perhaps even more ominously, levels of social trust also seem to be decreasing throughout the world, particularly among young adults, who also happen to be the heaviest users of technology.

Startups, often without directly saying so, are entering this fray with their own solutions. Startups like Airbnb and Uber are not just about facilitating a transaction, but rather about facilitating trust to allow for a transaction. They have two-sided reputation systems to remove bad actors, and to provide information to both parties to make a transaction easier to make.

Even more broadly, Bitcoin and the recently launched Stellar are attempting to entirely do away with trust in our existing commerce. By trusting a simple protocol and the blockchain, we no longer need to have faith in a consumer’s ability to pay, or even in the stability of a single fiat currency. If the currency is located in a Bitcoin account, it can be transacted without any knowledge of the account holder, no human trust required.

As I mentioned before, much of the development and flourishing of human civilization has involved the abstraction of elements of our economy. If we think along this line, these new technology systems are not nearly as disruptive as they first appear, but rather merely the next logical phase of abstraction in the economy. If it is possible to take human-based trust out of these transactions and replace it with a computer — which presumably we trust more — isn’t this progress?

Indeed, there are truly incredible advantages to the creation of anonymous trust. Commercial transactions that may never have occurred under our previous economic infrastructure may now have a framework for trade, which is almost certainly a positive for economic growth. Those same improvements also apply to services, where computational trust systems can facilitate more work and a greater volume of wages.

The challenge is that trust isn't just the bedrock of our economic system, but also the core architecture of our political and social systems. When a country raises tax revenues to pay for institutions like schools, we are trusting that the government is using such funds judiciously and in a way that fosters the development of the country. This compact is based on trust, and it isn't simple to replace with a computer.

Given the option of having more information about a transaction, most rational agents in an economy would prefer to receive it. We would rather know if the person we are offering our services has the ability to pay or has had serious issues with other professionals. Since computers can increasingly provide us with robust reputation systems, it seems inevitable that such systems will enter into more of our daily transactions.

But if a greater number of our daily transactions are mediated by computational trust systems, we may be withering out ability to handle trusting transactions. When a non-profit asks for donation, are we going to Venmo it so we know that it wasn't stolen by the solicitor? Will we continue to give our kids allowances in cash, or instead replace it with online currencies that are strictly regulated by parental controls? The more computers provide us with the capability to avoid issues of trust, the less practice we will have in basic human-to-human interactions.

Perhaps this is too cynical a view. Even if Airbnb mediated the transaction, it is still the case that I allowed someone into my home who I have never met. Nonetheless, I think it behooves us to be watchful for how our technology influences our culture. Trust is too important to merely leave to machines to do. We need to make sure that our ability to trust others doesn't atrophy like our ability to write using a pen.

Uber's Playbook for Sabotaging Lyft

As reported by The Verge: Uber is arming teams of independent contractors with burner phones and credit cards as part of its sophisticated effort to undermine Lyft and other competitors. Interviews with current and former contractors, along with internal documents obtained by The Verge, outline the company’s evolving methods. Using contractors it calls "brand ambassadors," Uber requests rides from Lyft and other competitors, recruits their drivers, and takes multiple precautions to avoid detection. The effort, which Uber appears to be rolling out nationally, has already resulted in thousands of canceled Lyft rides and made it more difficult for its rival to gain a foothold in new markets. Uber calls the program "SLOG," and it’s a previously unreported aspect of the company’s ruthless efforts to undermine its competitors.

Together, the interviews and documents show the lengths to which Uber will go to halt its rivals’ momentum. The San Francisco startup has raised $1.5 billion in venture capital, giving it an enormous war chest with which to battle Lyft and others. While the company’s cutthroat nature is well documented, emails from Uber managers offer new insight into the shifting tactics it uses to siphon drivers away from competitors without getting caught. It also demonstrates the strong interest Uber has taken in crushing Lyft, its biggest rival in ridesharing, which is in the midst of a national expansion.

After The Verge asked Uber for comment on its report, the company stalled for time until they could write this blog post introducing Operation SLOG to the world. "We never use marketing tactics that prevent a driver from making their living — and that includes never intentionally canceling rides," the company said.

‘A special ongoing project’

Earlier this month, CNN reported that Uber employees around the country ordered and then canceled 5,560 Lyft rides, according to an analysis by Lyft. (Lyft arrived at this figure by cross-referencing the phone numbers of users who tried to recruit Lyft drivers to Uber with users who had previously canceled rides.) Uber flatly denied trying to sabotage its competitor: "Lyft’s claims against Uber are baseless and simply untrue," the company said.

But one Uber contractor The Verge spoke with said Lyft’s complaint had merit. "What’s simply untrue is that not only does Uber know about this, they’re actively encouraging these actions day-to-day and, in doing so, are flat-out lying both to their customers, the media, and their investors," the contractor said. Until now, the canceled Lyft rides have been understood as a kind of prank call designed to keep competitors’ drivers off the road. But interviews and internal documents suggest another reason: Uber’s recruitment program has vastly increased in size and sophistication, and recruiters cancel rides in part to avoid detection by Lyft.

The ground troops in Uber’s sabotage campaign are the company’s ambassadors, some of whom it hires through TargetCW, a San Diego-based employment agency. For the most part, ambassadors work at events or on college campuses, promoting Uber as a cheap and easy way of getting around town. The primary goal is to recruit riders, not drivers, and Uber calls the activity "slanging." But since at least mid-summer, some brand ambassadors in New York have been turning their talents against Lyft. Using Uber-provided iPhones and credit cards, the contractors hail rides, strike up conversations with their drivers, and attempt to sign them up before they arrive at their destination. (In other cities recruiters travel with "driver kits" that include iPhones and everything else a driver needs to get started on Uber; ambassadors were told New York State does not allow this.) Compensation varies, but contractors can earn a $750 commission for successfully recruiting a single new driver to Uber, according to a contractor.

Organizing a street team

As Lyft has gotten better at sniffing out recruiters and banning them from the service, Uber has been forced to alter its tactics. In the run-up to Lyft’s high-profile launch last month in New York City, Uber organized a "street team" to analyze Lyft’s expansion strategy. On July 9th, a marketing manager emailed a subset of the company’s contractors in New York city with a new opportunity. "We have a special ongoing project that we’re going to be rolling out next week and I wanted to get about 8–10 of you to help out," he wrote. "This is going to be completely based on your own personal hustle, as it’s not a typical onsite event. We are going to have you working on your own time helping us sign up Uber drivers, and there is HUGE commission opportunity for everyone you signup."

Operation SLOG

The special ongoing project had a different codename: SLOG. Contractors in New York who responded to the "special ongoing project" message were invited to individual hour-long meetings with Uber marketing managers, who had traveled from Los Angeles and Washington, DC, to New York to oversee the team’s creation.

It was there that the company laid out its plan, according to a contractor. With Lyft’s arrival in New York imminent, Uber said it was creating a "street team" charged with gathering intelligence about Lyft’s launch plans and recruiting their drivers to Uber. Contractors were then handed two Uber-branded iPhones and a series of valid credit card numbers to be used for creating dummy Lyft accounts. Uber assumed every contractor would be caught by Lyft eventually; the second phone, according to a contractor interviewed by The Verge, was issued so "you would have a backup phone if and when that happened so you wouldn't have to go back."

Backup phones for days

A follow-up email outlined the process for recruiting Lyft drivers in detail. It emphasizes the importance of requesting rides from different physical locations so as not to arouse Lyft’s suspicions, suggests methods of recruiting, and outlines the process for signing up drivers on Uber’s platform.

The message linked to an online form, which was still active as this story went to press, where Uber could collect information about the Lyft drivers.

As their plans evolved, Uber realized the likelihood that Lyft drivers would be recruited multiple times by its team members and alert Lyft about the street team’s existence. The solution: a private group on the messaging app GroupMe where members of the street team could post Lyft driver profiles. That way, Uber contractors could make sure their Lyft driver had not already been pitched. "You guys will run into drivers you have already got in cars with," a Los Angeles-based marketing manager emailed the team. "Post the driver profiles in groupme when you request so people are aware."

In messages to the contractors, Uber’s marketing managers are full of good cheer. "Hello my lovely Sloggers!" begins one note, which gives instructions for filling out some paperwork. Once that’s out of the way, she writes, "then it’s all the little Lyfts your hearts desire." She ends her sentence with the hashtag #shavethestache, a reference to the big pink mustaches Lyft drivers affix to their vehicles’ grilles.

Uber appears to be replicating its program across the country. One email obtained by The Verge links to an online form for requesting burner phones, credit cards, and driver kits — everything an Uber driver needs to get started, which recruiters often carry with them. The form lists 10 cities, including LA, Seattle, Boston, Miami, and Washington, DC. "We are growing and growing so with that said this will put some organization to your madness," says the form, which was still live at the time of publication. "I need BA phones to make a lyft account," reads one line, referring to brand ambassadors; "Great how many do you need," reads the line below.

"This will put some organization to your madness!"

Uber’s aggressive tactics reflect the fact that ridesharing is largely a zero-sum game: a driver picking up an Uber customer can’t simultaneously pick up a Lyft customer. (Drivers are allowed to drive for both services, though the companies discourage the practice.) Having more active drivers on the road creates a virtuous circle that improves geographical coverage, increases demand, and allows services to lower prices by taking a smaller cut from a growing number of rides. Uber and Lyft are competing to become the first app you think of when you need a taxi, and the service with the most drivers likely stands the best chance of winning.

That helps to explain why competition between the two has become so vicious, with Uber and Lyft both offering hefty bonuses and other perks to drivers who switch services. For a time, Uber lost money on every ride to help spur demand. And Lyft has itself aggressively recruited Uber drivers, offering cash bonuses for joining, and hosting free taco lunches at its driver center. The Spy-vs.-Spy nature of their competition was revealed again earlier this month, when Uber caught wind of Lyft’s multi-passenger ridesharing offering and preemptively announced a nearly identical offering the night before Lyft made its announcement.

Lyft declined to comment for this story. After Uber became aware that The Verge was asking questions, Target CW sent out multiple emails warning contractors that talking to the press violated a non-disclosure agreement they signed when they joined.

Tesla Recruits Hackers to Boost Vehicle Security

As reported by ComputerWorld: Electric carmaker Tesla Motors wants security researchers to hack its vehicles. In coming months, the Silicon Valley based high-tech carmaker will hire up to 30 full-time hackers whose job will be to find and close vulnerabilities in the sophisticated firmware that controls its cars.

"Our security team is focused on advancing technology to secure connected cars," a company spokesman said via email. The focus is on "setting new standards for security and creating new capabilities for connected cars that don't currently exist in the automotive industry. The positions are full time, and we will have internship opportunities as well."

Tesla's cars are among the most digitally connected vehicles in the industry with the battery, transmission, engine systems, climate control, door locks and entertainment systems remotely accessible via the Internet.


So the company has a lot at stake in ensuring that the connectivity that allows its vehicles to be remotely managed doesn't also provide a gateway for malicious hackers.

Security researchers have already shown how malicious attackers can break into a car's electronic control unit and take control of vital functions including navigation, braking and acceleration.

In 2013, two researchers at the Defense Advanced Research Projects Agency (DARPA) showed how they could take control of a vehicle through the controller area network (CAN) used by devices in a car to communicate with each other. The researchers showed how attackers could send different commands to a car and cause it to brake or accelerate suddenly or jerk its steering wheel in different directions.

In that study, the researchers needed physical access to the CAN bus to carry out the attack. However, researchers have noted that similar attacks can be carried out wirelessly by accessing the CAN bus through Bluetooth connections, compromised Android smartphones and vehicle tracking and navigation systems like OnStar.

Such concerns have begun gaining wider attention with the federal government's plans to require all vehicle manufacturers in the U.S. to incorporate vehicle-to-vehicle (V2V) communications capabilities in all light vehicles over the next few years.

The goal is to have a standard in place that would allow vehicles to automatically exchange information, such as speed and location data, with each other, with a view to avoiding collisions.

In a notice in the Federal Register this week, the National Highway Safety Traffic Administration (NHSTA) said it was seeking comments on the privacy and security implications of V2V technology.

"Some crash warning V2V applications, like Intersection Movement Assist (IMA) and Left Turn Assist (LTA), rely on V2V-based messages to obtain information to detect and then warn drivers of possible safety risks in situations where other technologies have less capability," the agency noted.

Tesla has been among the most proactive carmakers in addressing potential security threats. It was the only automaker to attend the recent Def Con security conference in Las Vegas, where a security executive took the opportunity to promote the company's responsible vulnerability reporting program and to recruit new team members.

The company says it has a policy of not taking legal action against security researchers who hack into its in-car systems so long as they comply with its responsible disclosure practices, which include full vulnerability disclosure and good faith efforts to avoid data destruction and privacy violations. It offers a bounty to hackers who help uncover particularly serious flaws in its firmware.

Tesla even maintains a security researcher hall of fame listing the names of about 20 researchers who have so fair reported confirmed vulnerabilities to the company.

Apple and Google Crush Map Patent in Early Test of Patent Office’s New Appeal System

As reported by GigaOM: An appeals board of the U.S. Patent and Trademark Office ruled last week that all 27 claims contained in a shell company’s 2003 patent are invalid, dealing what is likely to be a fatal blow to the company’s lawsuit against Apple and Google over map displays in the iPad and iPhone.

In a unanimous ruling, three judges of the Patent Trial and Appeal Board found that the patent claims, which are for a method of displaying street level images next to a map, were obvious or not new. Here is an image of the technology in question:


The owner of the patent, a Florida-based patent troll called Jongerius Panoramic Technologies LLC, sued both Apple and Google in 2012, because of the companies’ inclusion of Google Maps’ “Street View” feature in the iPad and iPhone.

In response, the two tech giants — which frequently clash with each other on intellectual property issues — filed a joint petition to invalidate the patent, citing so-called prior art, including journal articles and earlier patents. The Board pointed to images like the one below, from U.S. Patent No. 6,346,938, in its 68-decision to side with Apple and Google:


For Jongerius Panoramic, which can be called a troll since it doesn't have a business outside of litigation, the Board’s finding all but dooms its patent lawsuit, which is currently on hold in California federal court. Reached by phone, a lawyer for the shell company declined to comment or say if Jongerius will appeal the decision to a specialized patent appeals court.

The Board’s decision is significant not only because it sees Google and Apple on the same side of a patent issue, but because it shows how a new Patent Office appeals system is working as a new tool to eliminate bad patents.

The system, known as 'inter partes' review, came into effect in 2013 last year as a result of the America Invents Act of 2012. It allows third parties to challenge patents before administrative judges, who have received over a 1000 petitions, but only began issuing decisions in recent months.

While the disgraced former Chief Judge of the patent appeals court bemoaned the new Board last year as a “death squad” for patents, it appears to be fulfilling its function of weeding out patents that the Patent Office should never have granted in the first place. Meanwhile, the Patent Office, which has been blamed for fueling the patent troll problem, is attracting new criticism over a wage fraud epidemic and a culture of slapdash approvals.

Here’s the Patent Trial and Appeal Board ruling, which is a slog, but is a good window into the arcane process by which patents are granted and challenged.

JAVAD GNSS Introduces TRIUMPH-F1 UAV

As reported by GPS World: JAVAD GNSS is introducing its new unmanned aerial vehicle with the dramatic flourish of a video showing the UAV in flight, accompanied by the “Also Sprach Zarathustra” theme from 2001: A Space Odyssey.

The TRIUMPH-F1 unmanned aerial vehicle is based on the JAVAD GNSS TRIUMPH-1. TRIUMPH-1 is the company’s field-tested high-precision geodetic GNSS receiver with 864 channels to track all current and future GNSS signals.

When used on the ground, the TRIUMPH-F1 can function as a TRIUMPH-1 base or rover. The four motor arms (for eight motors) are detachable. There are four screw inserts in the bottom to attach the TRIUMPH-F1 to a pole mount for field use.

The TRIUMPH-F1 features user-friendly mission programming. The four lithium polymer batteries that power the eight propeller motors, arranged in a stacked quad formation, each have a test button and LEDs to indicate the current charge level, as well as accessible ports for easy charging.

The TRIUMPH-F1 also has two micro-SD slots for image storage, a SIM card slot, a USB connector for uploading flight plans and downloading collected images, and indicators for satellite tracking and communications. Other indicators are dedicated to flight status and gyro. It comes equipped with four angled documentation cameras and a downward high-precision camera for photogrammetry.

JAVAD GNSS will exhibit the new device at InterGeo, to be held October 7-9 in Berlin.

Two Galileo Satellites Lose Their Way

As reported by Physics.org: Two European Galileo satellites launched as part of a navigation system designed to rival GPS have failed to locate their intended orbit, launch firm Arianespace said Saturday.

The European Space Agency said an investigation had been launched into what it said were "the anomolies of the orbit injection" but that the satellites were being safely controlled.

The satellites Doresa and Milena took off from the Kourou space centre in French Guiana aboard a Russian-made rocket on Friday after a 24-hour delay because of poor weather.

"Observations taken after the separation of the satellites from the Soyuz VS09 (rocket) for the Galileo Mission show a gap between the orbit achieved and that which was planned," the Arianespace said in a statement.

"They have been placed on a lower orbit than expected. The teams of industries and agencies involved in the early operations of the satellites are investigating the potential implications on the mission," it said.

The 5.4 billion euro ($7.2 billion) Galileo constellation is designed as an alternative to the existing US Global Positioning System (GPS) and Russia's Glonass, and will have search-and-rescue capabilities.

Jean-Yves Le Gall, France's Galileo coordinator, told AFP it would be "complicated" to correct the orbit of the two satellites.

"We are trying to see if we can remedy the situation in the coming hours," he said.

The European Space Agency said both the satellites were being "safely controlled" from its operations centre in Germany.

Initially, Arianespace had said that the satellites had separated from the mothership to enter into free-flight orbit as planned just under four hours after launch.

Factfile on the European global navigation system Galileo

"These two satellites are the first of a new type of satellite that are fully owned by the EU, a step towards a fully fledged European-owned satellite navigation system," the European Commission, which funds the project, said Friday.

'Technical difficulties'

Four Galileo satellites have been launched previously—one pair in October 2011 and another a year later.

They are the nucleus of the constellation orbiting Earth at an altitude of 23,500 kilometers (14,600 miles), and will later be brought to full operational capability.

The launch of the latest pair, named by two European schoolchildren who won a drawing competition, had been delayed for over a year due to what the ESA described as "technical difficulties in the setting up of the production line and test tools".

Arianespace said Thursday it had signed a deal with the ESA to launch 12 more satellites from 2015 onwards.

In March last year, the agency announced the first four test satellites had passed a milestone by pinpointing their first ground location, with an accuracy of between 10 and 15 metres (32 to 49 feet).

For its ninth liftoff from Guiana Friday, the Soyuz rocket carried a total load of 1.6 tonnes, including the two satellites weighing 730 kilos (1,600 pounds) each.

"We are extremely proud to have sent the first two operational satellites in the Galileo constellation into orbit today," Arianespace chairman Stephane Israel had said Friday.

High precision

Two more satellites will be launched at the end of 2014, when initial Galileo services were expected to begin.

It is unclear whether Saturday's "anomaly" will affect this schedule.

The Galileo constellation is scheduled to have 24 operational satellites by 2017, with six backups to join the fleet at a later date.

Operating at a higher altitude than GPS, Galileo's satellites have a stronger signal and higher inclination angle, providing better ground visibility, particularly in built-up areas.

They are also equipped with the most accurate atomic clocks ever used in navigation, with a precision of one second in three million years.

Ultra-precise time measurement is crucial in satellite navigation, as calculations are based on the length of time it takes a signal to reach ground stations. An error of just one billionth of a second can lead to a positioning deviation of several dozen centimeters back on Earth.