Thursday, April 17, 2014

Cost of a DIY NSA?

A core thesis of mine these days is that citizens worried about NSA surveillance are only seeing the tip of the iceberg.  Computers get cheaper and faster every year.  This puts surveillance technology within reach of just about anyone.

Let's build our own surveillance network on a street corner, with some spy cameras, and consider how much it costs.

Data point #1: Bandwidth and storage costs for a 24 hour video feed.  We'll imagine that one camera produces 1GB/day.

Data point #2: Spy cameras such as this one.  To ensure good coverage of our street corner from multiple angles, we will place 6 spy cameras at $9.00/each.

Data point #3: Amazon cloud storage.  Inbound bandwidth is free.  We are uploading 6GB/day.  Because we are super-smart and know the NSA's secret time travelling techniques, we will store 60 days worth of video.  That caps our data storage at 360 GB.  Cost: $10.80/month.

Data point #4: Open source biometrics software.  This is free.

Data point #5: Amazon cloud processing.  Being conservative and over-estimating, we will have a 3-computer cloud processing our video data for biometrics, running 24/7.  Cost @ m3.large: $302.00/month.

Data point #6: Derived data.  The data so far is just raw video.  We want to build a database of persons, cars, etc. over time.  We'll assume a 3x expansion of data storage due to this.  That increases our data storage cost to $43.20/month.  This is a conservative over-estimation, as derived data will likely be exponentially smaller than raw video.

Data point #7: Site controller, to which all the spy cameras connect.  Just need a laptop and an Internet connection.  Cost: $300.00 one time for laptop, $60.00/month for Internet.

Total non-labor costs for our street corner DIY NSA project:
  • $354.00 initial
  • $405.20/month
For this cost, you may obtain a wealth of biometric data:  faces, license plates, associations between people, other biometric markers such as voice or gait, product usage.  Anything that may be gleaned from audio or video by simple, legal, public observation over time may be data mined for biometrics and personal data.

Folks engaged in the NSA debate often do not realize how inexpensive and accessible is this technology to local law enforcement, private corporations, and criminals.

Cheap cloud storage and data mining has implications for freedom of association and freedom of thought.  The NSA via Snowden has made this issue starkly clearly... but the media and public miss the larger point that technology itself, not NSA abuses, are leading us to global surveillance state where we will be watched by any number of public and private parties without our knowledge or consent.

Note: This post intentionally over-estimates costs by taking retail prices, not at scale, and assuming naive software implementations.  A local law enforcement agency or Google-level corporation could easily reduce these costs by large factors (100-1000x).

Monday, April 14, 2014

On Amazon, bitcoin and Stan Lee

After experimenting with bitcoin in July 2010 ("the great slashdotting") and finding it to be a sound design, my thoughts ran in a predictable direction:  what are the implications of a global digital currency?  What are the engineering practicalities required to bootstrap a brand new digital economy from zero?

the Amazon, though not the one we're talking about in the articleIf you imagine a new currency being rolled out worldwide, the idea of how might implement the currency inevitably comes up.  Amazon's business has several major components that deal with payments of various types.  It is relevant to Amazon and bitcoin that we consider all of these payment types, not just the well known storefront payment flow.
  • storefront.  Buy a book, pay with credit card, etc.
  • Amazon Payments.  A bit of a Paypal clone, though they don't market it that way.  Can have a positive balance, send P2P payments in-system.
  • Handling fulfillment and payout to merchants who sell goods through their systems.
  • Amazon AWS Flexible Payments Service
  • Amazon AWS DevPay
  • In the time it took for you to read this, Amazon has probably created another cloud payment service.
While performing research related bitcoin, I examined the money transmittal space to learn which corporations maintained money transmittal licenses nationwide.  According to my research circa 2010, Amazon is one of the few Fortune 500 companies with money transmitter licensing in all US states.  Adopting bitcoin, at a minimum, probably requires Amazon to re-evaluate compliance at a time when they are also trying to lobby US states on sales tax issues.

The network effect (Amazon's size) must also be considered. today is basically "the Internet store." No need to qualify further.  With upcoming local delivery efforts, that effect is even more pronounced.

Like Google or Wal-Mart, every move by a company of this size has enormous consequences, intended and unintended.  Amazon adopting bitcoin today would have a disruptive effect on bitcoin, credit card systems, and banks worldwide.  At scale, one hopes Amazon acknowledges that great power and aims to wield it responsibly.  It is a fair and rational position for a company of that size to sit back and let the market sort out which crypto-currency to adopt.

On the technical side of the equation, a new payment system at is likely a major undertaking.  Amazon's software is entirely homegrown, and quite complex.  So complex that their store evolved into a web services business (AWS).  Having been recruited by Amazon myself, and having friends who work at Amazon as engineers, I know that Amazon stays at the bleeding edge of computing technology.  Integrating bitcoin -- or any digital cash -- probably requires extensive software updates throughout the system.  Digital cash, after all, does not behave like a credit card or debit card.  Those behavior differences can ripple through highly custom software, increasing engineering costs.

As a bitcoin supporter, I certainly feel the aforementioned disruptive effect is a positive one for the world.  But there are many reasons why Amazon in particular would be conservative about adopting an experimental new digital cash.  Given the above factors, my prediction -- dating back to 2010 -- was always that Amazon would sit back and let others decide the bitcoin-or-not question.