Note to recruiters

Note to recruiters: We are quite aware that recruiters, interviewers, VCs and other professionals generally perform a Google Search before they interview someone, take a pitch from someone, et cetera. Please keep in mind that not everything put on the Internet must align directly to one's future career and/or one's future product portfolio. Sometimes, people do put things on the Internet just because. Just because. It may be out of their personal interests, which may have nothing to do with their professional interests. Or it may be for some other reason. Recruiters seem to have this wrong-headed notion that if somebody is not signalling their interests in a certain area online, then that means that they are not interested in that area at all. It is worth pointing out that economics pretty much underlies the areas of marketing, strategy, operations and finance. And this blog is about economics. With metta, let us. by all means, be reflective about this whole business of business. Also, see our post on "The Multi-faceted Identity Problem".

Thursday, December 31, 2015

Facebook and Free Basics: let us harness the Wisdom of Crowds

The Wisdom of Crowds is a powerful thing. But in the case of the latest marketing campaign launched by Facebook around Free Basics, it is not quite clear that the wisdom of crowds is coming to the fore. First, some background on the Wisdom of Crowds.
In 1785, a French mathematician named Marie Jean Antoine Nicolas de Caritat (known as Marquis de Condorcet) used statistics to champion democracy. 
Democracies are based on the collective decisions of large groups of people. But citizens aren’t experts on every topic, and so they may be prone to errors in the choices they make. And yet, Condorcet argued, it’s possible for a group of error-prone decision-makers to be surprisingly good at picking the best choice. 
Condorcet’s logic was simple. Assume you have a group of people each independently making a choice about a question. Assume that they have a chance of making the wrong choice–but that their choices are better than random. If the decision they’re trying to make is either thumbs up or thumbs down, for example, their chance of picking the right answer only needs to be greater than 50 percent. The odds that a majority of them will pick the right answer is greater than the odds that any one of them will pick it on their own. What’s more, Condorcet argued that the group’s performance gets even better as its size goes up. 
Condorcet’s argument is the foundation of what’s now commonly called the “wisdom of crowds.” Individuals who have imperfect understanding of a situation can band together to become good at collective decision-making. 
There are some famous stories that illustrate the wisdom of crowds. Just over a century ago, Sir Francis Galton asked 787 people to guess the weight of an ox. None of them got the right answer, but, pooled together, their collective guess was almost perfect. In his book, The Wisdom of the Crowds, James Surowieckiwrites about the game show “Who Wants to Be a Millionaire?” Contestants could get help answering questions either from an individual friend whom they considered an expert, or from a poll of the audience. The majority of the audience picked the right answer 91 percent of the time, while individual friends only did so 65 percent of the time. 
Many scientists have used Condorcet’s idea (known as the jury theorem) as a launching pad for exploring collective decision-making. They’ve expanded the basic theory to include more features of crowds–such as the way information can move through them. They’ve tested out versions of the jury theorem on real groups of humans and animals. And their research has shown that crowds really can be wise. People can indeed make better decisions in groups than on their own. And while animals may not be able to pick presidents, they can also make good decisions in groups. It may be hard for an individual fish to recognize a predator in a murky ocean and escape in time. But a school of fish can pool its uncertain information to avoid enemies.

Case in point: Facebook published some rebuttals to an article by Mahesh Murthy, an Indian VC, and it turned out that there were problems with Facebook's claims and numbers. The Wisdom of Crowds was in full evidence here. Many people managed to spot the problems with Facebook's advertised numbers. (The only notable thing about one of the numbers, 3.2 million petitioners, was how heavily self-selected it turned out to be). Here is an extract from Facebook's rebuttal.

FACEBOOK’S ADVERTISEMENT CLAIM: In the past several days, 3.2 million people have petitioned the TRAI in support of Free Basics 

 MAHESH WRITES: Let’s again say it for what it is: 3.2 million people out of Facebook’s base of 130 million people who were repeatedly shown a misleading petition by Facebook on top of their pages clicked yes and submit, without being told both sides of the story, and thinking they were doing something for a noble cause, and not to further Facebook’s business strategy. A large number of them, shocked at realizing what they were conned into doing have since said no.

 FACEBOOK SAYS: This is false. Only a small fraction of our 130 million users were notified. We largely provided the notice to people who had previously indicated their support of Free Basics months ago and then notified their friends only if the person showed support once again. And the response rates of support are high compared to average campaigns. There is no evidence that “a large number” of them feel conned. Note: Claims on Twitter about false sends or notifications are disproved by the code – which we will happily supply to TRAI. Our program is benefiting people and we will continue to advocate for its benefits, much like its critics are using their communication channels to make their opinions known.

 MAHESH’S RESPONSE: Thank you for confirming that your Facebook vote-getting effort wasn’t representative, but aimed as you say at only that “small fraction” of your users who had already showed support for In other words, you’d stacked the deck. So why wouldn’t you say this earlier, and why brandish a number like 3.2 million about that you yourself admit is heavily selection-biased and not representative at all?

The Wisdom of Crowds only operates when people have access to all the information. Facebook should be made to run a proper, scientifically accurate campaign on all their claims. They definitely have enough social scientists to be able to do this. Indeed, if they have the resources to marshal 3.2 million people to petition, as they claim, in what turned out to be a scientifically wildly inaccurate campaign, surely, they can marshal the resources for a smaller scientifically accurate campaign. And why not call out the data collection as such (Sample blurbs to accompany their advertised data: "These are not scientifically accurate data" and "This is not a sample of people without selection bias and, therefore, the opinions of the people cannot be considered representative")?

Here are some further thoughts fro me - based on a Facebook discussion with some friends.
In this debate, there are three constituencies/interest groups here:

(1) Facebook (which incl. the RComm-Facebook JV): they want to offer "so called free internet". In return, they hope to monetise revenue streams arising out of people converting. Their calling the fact that people are converting to a paid Internet a case of "improvement" does not per se make much sense. This is partly because Facebook does not pay taxes in India. This is also partly because people might be paying for a product and not realizing that there may be adverse long-term consequences from the product. (W.r.t FB not paying taxes- it sounds much more like revenues -leaving- the country, and so FB's case would be far more convincing if they agreed to start paying taxes in India and hosted their servers there.) 
(2) VCs/Net Neutrality activists/developers/et cetera: this consituency wants a "net neutral" solution. Mahesh Murthy has argued their case. 
(3) Strategy and Policy people: this includes people like myself and James Bonilla (James Bonilla is a pseudonym for a collective of intellectuals, who wish to remain anonymous). What we would like to see is a mix of the two approaches: let Facebook continue to do what they are doing, and then, at a later point, have them submit more convincing numbers in a quarter or two. In the meantime, there is nothing wrong with having Facebook spend a further 100 crores on their marketing campaigns in India. Can't see how it can hurt - given that myself and the caped crusader James Bonilla are watching them closely ;)
In the interest of free speech, Facebook should agree to publish numbers and data on what they are seeing in terms of traffic and uptake - the demographics of the uptake are as important as the sheer numbers themselves - and Facebook should also agree to present data as it emerges not only to TRAI but also to public advocacy forums (such as the "Association for Democratic Reforms", just to pick a name). Indeed, anyone who wants the data should have the ability to access it. A closed discussion without the relevant numbers is no discussion at all.

The Wisdom of Crowds should be allowed to exercise its power.