I Don't Want To Be A Nerd!

The blog of Nicholas Paul Sheppard
Archive for march 2013

Prediction, being popular and being right

2013-03-11 by Nick S., tagged as prediction

Looking at the categories listed on the right-hand side of this blog, I noticed that the two I've used most are "prediction" and "mobile computing". This seemed ironic given that prediction and mobile computing are things that I mostly avoid. Of course the tags reflect the number of posts in which I've taken issue with buzzword-driven predictions and the black box fallacy. Reading the works of Duncan Watts and Daniel Kahneman recently gave me further justification for staying out of the prediction business, refined my dim view of it, and gave me some constructive thoughts on how to deal with forecasting.

According to both Watts and Kahneman, predictions made by supposed experts in a variety of fields are no better than random guesses. This, they suggest, is due to the prevalence of "unknown unknowns" in complex systems like politics, human societies, the economy, and the environment: in systems like this, there are invariably numerous unforeseeable influences that would-be forecasters can't even know that they ought to be thinking about, let alone predict. Experts nonetheless make bold predictions because confidence sells: few people have much interest in "experts" who can only give them uncertain and equivocal advice, so experts are under great social and financial pressure to make bold and confident predictions that, by and large, they won't be held accountable for anyway.

Reading the chapter of Kahneman's Thinking, Fast and Slow on this, I was reminded of a misgiving that I had about Martin Seligman's work on positive psychology. Seligman observes that optimists frequently blame failure on specific changeable circumstances, giving the optimist hope that he or she can still succeed when trying again under (hopefully) other circumstances. Seligman contends that this is good for the optimist, who will persist, but seems to be largely uninterested in its consequences for everyone else. His favourite example seems to be the selling of insurance through cold-calling, in which the heroes are those optimists who persist despite being knocked back by nine out of ten potential customers. Seligman shows no interest in the fate of the nine out of ten people who had to endure an unasked-for sales pitch for a product they didn't want.

So it seems that being a bold and confident personality might be beneficial for an individual while being detrimental to the societies or organisations to which they belong. Kahneman cites the example of optimistic CEOs who make bold and impressive-sounding decisions that wind up losing money for their companies. (He also observes that the opposite might happen: the economy as a whole benefits from the optimism of would-be business owners who start ventures even though statistics indicate that only one-third of such ventures actually succeed).

Reading Kahneman's book (and maybe this blog), it's easy to feel like all prediction is hopeless. Of course there are plenty of things we can predict with great confidence: engineers, for example, routinely make accurate predictions about the behaviour of structures, machines and computers based on well-tested models of how the the world works. But few people find such predictions very interesting, perhaps because they are so routine. There's simply more glory to be had in making hopelessly inaccurate predictions and ignoring their consequences.

Potholes on the road to the couch potato

2013-03-03 by Nick S., tagged as commerce, digital media

I've had a couple of conversations with work colleagues over the past few months in which the colleagues seemed to be surprised that I still rent videos from a physical DVD store rather than obtain them on-line. Prior to those conversations, I don't think it had even occurred to me that I could watch videos on-line — mainly, I guess, because I had a routine that I felt was working well and was in no need of change. I've also only fairly recently obtained an Internet connection plan with sufficient speed and capacity that I can actually watch movies over it.

When I later took a look at what was on offer at the on-line video store operated by Internet service provider, I found that said store features a much narrower range of movies than does my local DVD rental store, and that it charges more for each rental. On The Conversation last week, Matthew Bailes also writes about the monopoly-like profits that computer companies can extract once they've trapped customers in the company "ecosystem". (So much for the notion that on-line retailers would run rings around old-fashioned bricks-and-mortar retailers by eliminating the need to pay rent, maintain capital stock, or pay service staff.)

A number of the commenters on Bailes' article ask the obvious question: why, then, use the on-line service?

One comment on Bailes' article observes that "if there really is a monopoly, it's only a monopoly to people who are desperate to avoid going to a shop." I imagine some people might reasonably be in that situation if they live in a remote area, or they have restricted mobility, or, as I recently overheard another work colleague remark, it's raining and they can't be bothered to walk to the video store. But none of those are true of my work colleagues or I — nor of Matthew Bailes, as far as I can tell — and the weather would have be pretty serious indeed to prevent me walking ten minutes to my local store.

There was a time, I guess, when I'd buy bleeding-edge technology without a lot of thought as to whether or not it really was the most efficient way of meeting my needs. I think I was motivated in part by the hobby value of experimenting with such technology, and in part by the price: given that I have the skills and patience to set up a TV card in Linux, say, why pay for a stand-alone television even if the latter would be much simpler and easier?

I can't see much hobby or educational value in purchasing slick consumer products like Apple TV and Bigpond Movies, though. In fact, walking to the shop is more like a hobby these days: I enjoy the exercise, the contact with my local area, and the experience of looking around at all of items for rent or sale. And, thanks to the school of economics attended by Apple, Telstra and others, it even seems to be more financially rewarding.