Internet History Podcast | Esther Dyson

So, I'm writing this book on AI and one of the things that's really important in the evolution of human intelligence is theory of mind. You know, what's in this other guy's mind? Are they trying to eat me? Are they trying to steal? And theory of mind was developed long before there was money or other things. The theory of mind in business is basically business models. You know, what is it they're after? What are they willing to give up to get what they want? Why are they looking at me that way? Why are# they ignoring me? And that all goes to what are they doing with my data? Why are they showing me these funny movies and not even making me pay anything? Well, it's because they're getting something else instead.

I mean again it was probably a bit... Yeah. The net can connect you to other kids. Wow. Yeah. 1997. And they can... This is about the teachers. They can use the net to communicate with your parents.

Allow people to find their people. Yes. No, it was amazing. But anyway, education, governance, intellectual property, that was an interesting one. You know, I was on the board of the Electronic Frontier Foundation and I don't think content should be free, but I do think it can be free and it's a contract. Yes, you have the right to control the use of your content, but you can't control what other people will pay you. And if you really want it to be spread widely, I'd much rather have people read my stuff than pay me money in the end. And content control. So it was, in retrospect, a fair amount about governance and what the business model should be rather than what's the hottest model of computer or something.

Yes, around 98 I think. Yeah. 98 to 2000.

Right. And for what it's worth, it's a perfect example of learning but not earning. And it's informed a lot of what I think about certain things. So first of all, it was born in a sort of form of original sin in the sense that the US government had this thing that had been DARPANET that became the internet and it was a nonprofit sort of owned by DARPANET and it was the bowels of the internet with all these IP addresses and stuff that were basically just numbers of where things were, like a giant card filing system for websites. And it was run by this guy called John Postel, who was a scientist with hair down to the bottom of his back. And there was some fight about something or other, and he shut down one of the servers for three days. And it's like, oh my god, we really need to... this thing is actually going to be kind of big. We'd better figure out how to manage it better. And the US government, being kind of sensible, said, we actually would like this not to be controlled by us. We think it should be controlled by the internet community. And the original sin was then they said, we're going to make it happen, and we're going to pretend it was the internet community because the internet community was not very coherent then or ever. And they got the EU involved because the EU had probably the second biggest chunk of compute around. Eventually they brought in Japan. And so meanwhile, there was a lot of... the government's trying to give the internet away. The business people said it's working, just don't mess with it. The freedom people said you need to have the internet people have control. And John Postel was kind of a unifying figure at least in the internet community. And then as this thing was beginning to happen, he went in for heart surgery and died of complications in a way that was completely not suspicious but very unfortunate. I got called in by Ira Magaziner because they were looking for somebody who sort of knew something but wasn't really aligned with anything because again I was a journalist, that was the whole point. And the board included Vint Cerf, who I was actually on a Zoom with earlier today and who was the obvious choice but didn't want to take on probably the burden and the politics. So we show up at our first board meeting in November of I guess 1998? 1998 to 2000? 1997?

Yes. Yeah. No, that's about right. I mean, that's all recorded. So instead of John Postel and sort of the internet whatever, there was Steptoe & Johnson, the law firm that kind of set the scene for this thing. I knew enough about the industry but I didn't know about the legal complexities. And our first mission was to basically undo the monopoly of Network Solutions, which was owned by I think VeriSign. Again, facts are available. And that was a big battle, but the government didn't want to look as if they were controlling things, so we had a very limited budget. And Jones Day, the law firm, said you should certainly have your board meetings in private, which caused a lot of angst everywhere. And then our Dutch board member in some interview or something said, it's a really stupid thing because if we hold open board meetings, we'll just decide everything at dinner the night before. Let's get real. Which of course was totally true. But we got off to a very rocky start. And Network Solutions one way or another was finding trolls to just spread rumors and angst and so forth. We did try to reach out to the... so way too much information here. What fundamentally happened was we got the thing going. It sort of worked. We created a competitive marketplace of registries and registrars. And then there was the .org registry, which was being managed by ISOC, which came up in the news three or four years ago when they tried to sell it. And so I got reinvolved. But there were really two missions. One was to make sure that the internet was not controlled by governments very closely. The International Telecommunication Union thought they should do it, and we managed to sort of get the governments involved but they were the Government Advisory Committee, they didn't control stuff. And the other one was, of course, to help create and regulate an honest free market for domain names. We did the first, I think, pretty well. The second we failed at, and it basically became a protection racket, which it is now. And we also didn't go after fraud effectively enough. There's a lot of scammers using fake domain names. There's lots of other ways to commit fraud on the internet too. But even the domain name system ended up not being as trustworthy as it should be. And it was also... nice Coca-Cola, that's a nice trademark you got there. Wouldn't it be a pity if something happened to it? And we can help you protect Coca-Cola.com, but now we're going to sell Coca-Cola.info and Coca-Cola.diet to the first comer unless you buy them all. And so they just kept basically inflating the currency of a domain name. So if you wanted to own a domain name with your trademark, there was some trademark protection, but if you had something like Sweet Pies or something, there was no way you could own that unless you bought hundreds of TLDs. And so somebody came up to me recently and said, is ICANN a model for governing AI? I said, no way. Anyway, I hope that's sort of what you want.

Yeah. No, no rush.

No.

You need an investment thesis if you're investing other people's money so that they know what you're buying, you know what you're promising. If it's your own money, you don't need to apologize to anybody for, as I said, always make new mistakes that emerge. So my investment thesis... I mean, obviously I need to like the person. I've made some mistakes there. I will invest in something that may or may not be successful because I know I will learn. And I would say my best example of that was 23andMe, from which I learned a huge amount but did not get paid out. I still own some shares that are trading and I'm not sure what's happening. So I guess in a way my investment thesis is the following. It's another one of my favorite sayings. If I was a maid, I would want a dirty room.

In other words, I want to fix things. I want things to work better. I want to clean up, not clean up like grab the money, but I'm the kind of annoying person who will go and move your pictures around so that they're straight and fold the towels or whatever. I have no interest in stuff that's... at one end I think things like Robinhood and basically addictive gambling are really, really bad. Then there's stuff, I have no objection if people buy stuffed teddy bears or Lulu whatever, but I have no interest in investing in that business. I like to invest in things that are basically useful and not redundant. I prefer implementation over innovation any day. Don't just be creative and innovative, actually make the thing work. FedEx was an example, right? Wonderful company. They did something useful. They did it innovatively. They did it better. They were clever and so forth.

Sure.

Oh, I learned a ton about genetics. I mean, it's...

Yeah. And it got me into rooms where, oh, she knows about genetics. I ended up being the number three person for the Personal Genome Project, which was a much more scientific thing. It's not just lessons learned. It's kind of like going to Tokyo or something. It's not, oh I learned X about Japan. It's I got into Japan. And this is the whole thing about AI, to understand anything, it's a lot more than just a logic model. Just being immersed in a particular... here's a great example. There was a company in Sri Lanka that made, still makes, women's underwear. If you've ever seen a production line with bras, it's amusing. They were moving into sort of intelligent clothing or wearables and stuff. I invested, I think I joined their advisory board. I don't actually know what... I've done a lot of things so forgive me if I don't get my facts right. But anyway, I got involved in that basically to get a couple of round trips to Sri Lanka and the ability to visit a local underwear factory. I took an extra day on either side and went to visit a local dissident. That's how I like to travel, not the fancy hotel and the museum. The world is so interesting.

Yeah. So first of all, there is a very clear and to me important narrative arc there. I went for the first time in 1989 with... and yeah, a whole other podcast. But I was so fascinated with the place I started a second newsletter called RE: East and began to go not just to Russia, where I'd learned Russian in high school, part of the physicist father, Russian neighbors, blah blah blah. So I started going to Eastern Europe as well and we did conferences for about 10 years, I think starting out with one in Budapest in 1991 probably. And because I'm a journalist, I wasn't investing at that point, so I did not actually start investing in the US until the 2000s. So about two or three years in, this guy Lee Keet from Vanguard Atlantic said to me, you keep talking about getting the East and the West together and having the Easterners come for free and the Westerners pay $4 or $5,000, which was quite a lot. But the theory and the practice was they were basically paying for the Easterners that they were interested in meeting. And Lee Keet said, so you keep talking about how these companies should invest in Eastern Europe. What about you? Why don't you invest in Eastern Europe? Suppose I gave you a million dollars. Would you? I said, oh no, I can't. I would. How much did you say? And because in Eastern Europe, a million dollars in the 90s went a long way. And so I ended up starting EDventure Ventures and we continued the conference, but I stopped writing the newsletter. And it was like, oh, if I run a conference and people think I'm going to give them money, they'll still talk to me. And for me, the real point was again watching this community develop. Writing the newsletter was a lot of work. It was also free. So there was no business reason to continue it. And so I started investing in Eastern Europe long before I started in the US.