Strange article on the BBC site today – When algorithms control the world. I say strange because a lot of it seems just plain wrong and much of the rest just waffle, which is relatively unusual from Jane Wakefield.
For example, on film rental recommendations by algorithms:
“The algorithms used by movie rental site Netflix are now responsible for 60% of rentals from the site, as we rely less and less on our own critical faculties and word of mouth…”
OK, I can accept the second bit about word of mouth, but I think it’s fair to say most people used to base their film viewing on trailers, charts and possibly critic reviews. But if you base your critical reasoning on a trailer you’ve failed at the first step, charts are more an indicator of lead popularity and advertising budget, and critical reviews are effectively based on algorithms not understood by the user (i.e. opinion). At least the Netflix/Amazon/Blockbuster algorithms are based on my opinions/actions or those of real viewers, and I also suspect that the algorithms are far from being difficult to understand.
There’s also the usual bit of Google bashing, with no alternative solution proposed to indexing the estimated 13 billion pages on the web; my view is that the most popular predecessor, Dewey Decimal, isn’t really going to cut it although deweybrowse.org gives it a go. Maybe alphabetical by web address would be cool, like the old phone books, thus resurrecting the aardvark as an unlikely company mascot and consigning the pointless
www prefix to history.
As for this one:
“Meanwhile, a transatlantic fibre optic link between Nova Scotia in Canada and Somerset in the UK is being built primarily to serve the needs of algorithmic traders and will send shares from London to New York and back in 60 milliseconds.”
Kind of like ticker tape but a bit quicker. OK, the trades were done by phone, but we’re still talking evolution here not radically new applications.
And algorithmic trading is a buzzword-friendly way of saying calculating the best trade, which I’m pretty sure the real human traders do as well, and in a similarly unpenetrable manner in most cases. Warren Buffet even publishes letters which go into some detail about Berkshire Hathaway choices, but you don’t see too many people taking this “algorithm” and making billions, there’s plenty more in the sage’s head to make it work.
Update: 26 August 2011 ~ 16:00
The corresponding Slashdot article has some interesting views.