By Larry Magid
This post first appeared in the Mercury News
As we approach the end of the year, it’s a good time to look back on 2023. The word that comes to mind is tumultuous, which, says Merriam Webster’s online dictionary, means “loud, excited, and emotional.”
Generative AI
The biggest story of the year has been the rollout of generative AI. ChatGPT was launched on November 30, 2022. By January of 2023, it was the fastest growing tech application in history with 100 million monthly active users. Shortly after its launch, Google introduced its competing Bard product, and Microsoft, which is a major investor in ChatGPT, rolled out a ChatGPT-powered generative AI version of its Bing search engine.
Over the course of 2023, generative AI has come to dominate tech. It seems as if just about everyone in Silicon Valley is talking about it as many companies announce AI enhancements based on similar technologies. Meta, which had bet the company on its virtual and extended reality “Metaverse” products, is now building GAI into its social products, including adding Meta AI agents that can answer questions and engage with users or groups of users in conversations on a variety of topics. Snapchat has announced a + service, which allows users to “use AI to create and send a Snap of whatever you know will make a friend’s day,” according to a company statement. I’ve been covering tech since the early 1980s, and I’ve never seen a technology gain this much traction in this little amount of time.
X marks the spot once occupied by Twitter
Another big 2023 story is the demise of Twitter and the emergence of alternatives, including Meta’s Threads service. Elon Musk completed his acquisition of Twitter in October 2022, and over the course of 2023, completely transformed the service, including changing its name to X. Although he and some of his supporters would argue he’s made it better, I’m among those who feel that it’s been degraded, in part because he has reinstated the accounts of numerous hatemongers and known liars, including infamous conspiracy theorist Alex Jones, who was ordered to pay nearly $1.5 billion in damages to family members of victims of the Sandy Hook School massacre who were harassed and threatened based on Jones’ lies. Musk also recently reinstated Andrew Tate, who, according to the BBC, is facing trial in Romania on charges of rape, human trafficking and forming an organized crime group to sexually exploit women. Many major advertisers have left X after pro-Nazi comments appeared alongside their ads.
Meta’s Twitter-like Threads app, which was launched in July 2023, got off to an enormously good start with 100 million downloads in its first five days, but subsequently encountered much slower growth. Still, it’s seen as a major alternative to Twitter and seems to be getting renewed momentum as Meta rolls out new features such as hashtags, web access and the ability to edit posts. Until it degraded, I loved using Twitter to promote my work and catch up on news from others and am glad to see Threads pick up some of the slack.
Financial issues
I don’t usually write about financial matters, but the scandal and subsequent collapse of Silicon Valley Bank and the collapse of the FTX crypto exchange and subsequent arrest and trial of its founder Sam Bankman-Fried were dominant tech stories this year. Silicon Valley Bank, which financed and provided banking services for many small and large tech companies, was shut down by California in March 2023. Later, the company and all its assets and liabilities were purchased by North Carolina-based First Citizens Bank, which is trying to revitalize the relaunched bank.
Speaking of financial matters, a number of tech companies had a tough time through much of 2023, resulting in cutbacks and layoffs. Meta, Google, Amazon and Microsoft were among the many companies that laid off a substantial number of employees. Most of the layoffs were near the beginning of the year, though some continue to struggle and reduce their workforce. But there have been some bright spots. Meta, which laid off thousands of workers in 2023, has hired some back as its fortunes have improved. Meta stock is up more than 250% for the year. Google, Amazon and Apple stockholders have also had a good year, at least in relation to the beginning of 2023, but that doesn’t mean that the headwinds are behind us. I’m only cautiously optimistic about 2024. There remains the possibility of another downturn.
Regulation
Another big 2023 story has been the increased appetite of state and federal officials to regulate social media, generative AI, market domination and other aspects of technology. The federal government hasn’t passed any major tech legislation this year, but there have been plenty of hearings and proposed bills, some of which may wind up being passed in 2024. States, including Utah, Arkansas and Texas, have passed controversial bills, including a Texas law that could prevent social media companies from moderating content some consider to be legitimate political commentary that others consider to be bullying, hate speech and dangerous misinformation in the name of free speech. Utah and Arkansas have passed laws that restrict teen’s use of social media, which could have a chilling effect on their right to express or consume information. All of these bills are facing court challenges.
As someone who focuses on youth and social media, I’m pleased to see that regulators are thinking about ways to protect children’s safety and privacy but worried about the unintended consequences of well-meaning legislation.
Where it leaves us
Like anyone who has spent decades observing the tech industry, I have seen many ups and downs over the years, including some years where I worried that companies would never rebound. And, while there have been bankruptcies and failures, for the most part, tech has recovered from downturns with steady rises in profits, employment and other key indicators in subsequent years. That steady rise has not only benefited investors and workers, but consumers as well who enjoy an increasing number of products and services. I’m not suggesting that every new smartphone or social media feature enhances our lives. Many are repetitive and inconsequential. But overall, we’ve seen some amazing developments. My house, which has numerous smart devices, is a lot more energy efficient and pleasant to live in than it was a few years ago. My car, which gets regular over-the-air software updates, is better now than it was when I bought it five years ago. My creativity, thanks to services like ChatGPT, is on an upswing and my health and fitness have benefited from smart watches, sleep monitors and other devices that provide vital information while encouraging healthier habits. Not everything in tech is great news. I worry about its impact on mental health and misinformation. But overall, it’s helping to create a better life for millions of people around the world. Despite its ups and down, 2023 was no exception, and I expect even more from 2024.
Disclosure: Larry Magid is CEO of ConnectSafely, an internet safety organization that receives financial support from some of the companies mentioned in this article.