Pattern Recognition

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ment teams, power stations mostly operated autonomously from the general Eskom management. These power station managers not only took operational decisions — like the temperature of boilers — but played a key role in the procurement of coal and in adapting systems based on the quality of the delivered coal.

“In other words, if there was turbulence in the general management of Eskom it shouldn’t have affected operations in the power stations themselves dire c t ly .” Yet Chipkin and co’ s modelling showed that from about 2008 there was a direct co r r e l at io n .

“What was going on?” C h ip kin wondered. “Es s e nt i a l ly , from about that time a new Eskom management began to centralise decisions that used to be the domain of power station managers. It was done ostensibly to improve efficiency and to drive organisational transformation.

“So as the senior management was ‘captured’ and became unstable, this turbulence was transferred directly into the power stations themselves. This is at the core of Eskom’ s current problems. The capacity of the power stations has been hollowed out.”

It seems fitting that, having caused so much damage, Es ko m’s issues have unwittingly and indirectly played a small part in the development of an algorithm to help other companies manage their organisational risk.

Chipkin says: “What excites me the most is that the methods and technologies we have developed are largely born from our experiences growing up in societies in transition, undergoing major political and institutional c h a nge .

“These experiences provided not simply the impetus to innovate methodologically, they helped us develop the very tools themselves.” x

Toby Shapshak

The year Big Tech lost its ‘big’

Amazon shed $1-trillion in market value and Facebook has dropped 70% since renaming itself Meta

hat is the biggest tech

Wstory of 2022? Was it Elon Musk’s astounding offer to buy Twitter for $44bn, or Amazon’ s $1-trillion loss in market value? Or Tesla’s $500bn halving of its value since Musk announced his plan to buy the “digital town square”? Or Facebook losing 70% of its market value since changing its name to Meta in October 2021?

This is the year Big Tech became just tech.

The market losses have been eye-watering. Even Apple is feeling gravity catch up with it as it tries to escape the pull of the post-Covid economic slump and rampant inflation.

After two years of work from home and a surge in online activity, people have returned to their offices and malls, and to socialising in real life. Laptop sales have plummeted, as has time spent online. As inflation pushed into double digits in the US and Europe, advertising spend started drying up — at the same time as the toxicity of social networks reached new lows.

It didn’t help that US lawmakers have finally woken up to the rampant monopolies that Silicon Valley has created and maintained — at the expense of the world’s privacy — by crushing the innovation of other tech startups.

The destructive effect brought about by several dominating behemoths in the broader tech landscape is now apparent.

Facebook was able to neuter competition from then nascent start-ups like Instagram and WhatsApp by buying them — as subpoenaed e-mails by the US Congress have revealed. As Marc Zuckerberg wrote in a 2008 e-mail: “It is better to buy than to co mp et e .”

Record fines have been imposed by the EU’s competition watchdog on Google for its data practices, while Facebook and Instagram have also been sanctioned.

There is an inescapable conclusion that the tech industry will be subjected to much greater oversight by US authorities in future as the numerous lawsuits by attorneys-general and the US justice department gather strength.

The biggest story of the year is arguably the implosion of cryptocurrency exchanges, with the notable nadir being the wholesale destruction of value by FTX, once valued at $32bn and now worth nothing.

This year crypto has lost more than $2trillion in value and the idea that it’s a viable alternative to fiat currency or traditional investing has been trashed. Millions of hapless retail investors lost everything after foolishly sinking their life savings into inflated crypto ventures that were heavily punted by wellpaid celebrities. FTX founder and CEO Sam Bankman-Fried, having lost his own $16bn fortune, can apologise as much as he wants; the damage is done.

The lawyer who helped clean up the mess left by Enron’s financial schemers says FTX is the worst he’ s ever seen.

Crypto, in its current form, is a classic Ponzi scheme: offering unrealistic returns and rewarding those who got in early. As Bankman-Fried can now tell you. Famous for his wild hair and for playing online computer games while doing calls with investors, he’ s been indicted on fraud charges in the US. The clue is in his surname: he is truly “f r ie d ”. But not as badly as the tens of millions of people from whom Big Tech has stolen their privacy, and, sadly, in many cases, their personal wealth too. x

Shapshak is editor-in-chief of Stuff.co.za and chief commercial officer of Scrolla.Africa