Software is eating the world. And it’s only the beginning.


(soft music) – Check out this self-driving truck. These are getting pretty good. Waymo is testing autonomous
tractor-trailers in Atlanta right now, and this
Einride truck, you can see there isn’t any space for a driver. There’s no deployment plans yet, but when these finally
make it on to the roads, they’re going to make shipping a lot cheaper. At the same time, millions of people who
drive trucks right now are gonna be looking for a new job. It’s not just truckers. This McKinsey Report estimated that about half of the jobs
people are doing right now could be automated with
technology we already have. The same report says that
between now and 2030, 400 million workers globally could lose their jobs to automation. This isn’t just about computers
becoming smarter than humans. It’s a profound change in
the way our economy works. And it doesn’t have to be a bad one. You just have to look at the big picture. So what’s happening to
trucking is the same thing that happened to
Blockbuster, travel agents, grocery store cashiers,
and dozens of other jobs. They’re being replaced
by a piece of software, which means the first model is expensive. But all the copies are basically free. In the business world they
call this Zero Marginal Cost, which means you can add
new users and revenue without spending more money. To see how that works, think
about how we share photos. – Kodak Film, for the times of your life. – For most of the 20th Century, Kodak was the biggest name in photography. But it couldn’t survive the smart phone. Kodak filed for bankruptcy in 2011, just four years after
the first iPhone launch. Now, instead of manufacturing
millions of canisters of film, we just use an app. It’s a good app, but it’s
not that complicated. And throwing more programmers at it won’t really make it better. At its peak, Kodak
employed 145,000 people. Instagram: it’s just under 500, and Instagram is worth a lot more money. So what happened to all those jobs? The shift didn’t come from some brilliant new
film-developing robot. We just stopped using film. It’s not robots replacing workers, but Zero Marginal Cost businesses
replacing legacy industry. People argue a lot whether
this is good for business or bad for workers. If you’re a pessimist, it looks like the end
of jobs as we know it. All the high-employment
companies like Kodak lose out to smaller
smarter tech replacements. Production gets more efficient. Wealth gets more concentrated. And unemployment goes through the roof. But where pessimists see
a future without jobs, optimists see a future without work. It used to take a lot
of labor to call a cab or get something shipped to your house. But now it’s easy. Businesses found a way
to serve lots of people with a single up-front investment. And that efficiency makes it
a lot cheaper for everyone. Some people look at that process and imagine a society where automation makes
almost everything free. Technological unemployment could be offset by a vastly cheaper cost of living, and social programs, like a Basic Income, People get really excited about this idea. Sometimes too excited. – You fuckin’ learn how to
use computers to make money in an easy way. And then you use that money to sustain like a commune basically. – It’s the first new economic system to enter onto the world stage, since capitalism and socialism
in the nineteenth century. It’s remarkable. – But we’re still really
far from that world. Most of the benefits of scaled software are going to people who own
Facebook and Google stock. It hasn’t touched stuff like housing, health care, and education, which are still where Americans
spend most of their money. That’s all getting more expensive. And swapping out your
cable bill for Netflix isn’t gonna make up the difference. But it doesn’t have to be that way. Even if we don’t go all the way to Luxury Space-Communism, we can still use progressive
taxation to fund things like public education and
universal health care. But first, we have to
admit there’s a problem. Thanks for watching. If you want to learn more about AI, Verge Science has a really
cool video right now about scientists using
Artificial Intelligence to achieve fusion. You can find that at
youtube.com/vergescience. And as always, like and subscribe.

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