Deutsche Telekom Tech, Our Friend and Foe

In an interview that touched on data privacy, the devil and a basic income for all, Timotheus Höttges, chief executive of Deutsche Telekom, Europe's largest telecoms provider, told Die Zeit technology is improving our lives but that he also fears the transparency it offers.
Technology means we have more time to do what we want, Mr. Höttges said.

 

Timotheus Höttges told German weekly newspaper Die Zeit how products give us more free time and are enriching our lives. At the same time, he acknowledged that a growing number of people experience stress and that technology has its limits and said in terms of data mining, perhaps it is not necessary for everything to be done that is technically possible.

Mr. Höttges talked about the current generation's attitude to work and said it isn't so different to how the previous generation thought about work. He said he is in favor of an unconditional basic income for all. And he said radical transparency, as depicted in "The Circle," a dystopian novel by U.S. writer David Eggers, frightens him.

 

DIE ZEIT: If you think about the future and let your imagination run wild, what are you most looking forward to?

Timotheus Höttges: I look forward to having more time for things that matter to us, so that we can unburden ourselves from things that are burdensome to us.

I've been hearing that since the beginning of the digital revolution, and yet I still have the impression that people are feeling more and more stressed.

I feel like my life has become richer, as I now have the ability to get information right away about everything that interests me. And the ability to share things, too, from images we share with friends through the cloud, or things like cars, experiences and emotions. Children share emotions! We often criticize children for spending so much time on the computer. But hasn’t the intensity of their experiences increased because they are always together with their friends? They can share every moment, using Snapchat or Instagram, no matter where they are. It isn’t the way it was when we were kids, when you would arrange to meet in the city at the three in the afternoon and then have only two hours to spend together.

People like you, who were born in the late 1950s or early 1960s, got together spontaneously, went out to the woods and had adventures together. There was a direct exchange of emotions – good ones and bad ones!

Kids today have that too. Of course, nature played a bigger role in our lives, and that may be something the current generation is missing out on. But this intensity, this sharing and exchanging of everything – even if we sometimes see it as banal – is, on balance, more than we experienced with our friends in our day.

That may be, but people don't like having to be constantly available, or the stress caused by the pressure to innovate to keep learning more.

Well, people bear some responsibility for their own stress. I try to find moments of absolute withdrawal, times when I am neither reachable nor allow myself to be distracted by the possibilities of the Internet. I do believe that our society has become more fast-paced as a result of the Internet, and that people lag behind in terms of their ability to adapt. This is a real problem, especially for older people.

Where will the extra time you predict we will have come from?

I am deeply convinced that, in the long term, classic physical tasks will be performed entirely by machines. Aside from that, software and computers will handle routine tasks that require brainpower. This will give us a huge amount of extra time, for social interaction and to pursue our personal interests. We will no longer work within such fixed working time models as we do today. Actually, we already have that today. Just compare our generation with the one before it – it was also completely normal for them to work during the weekend, say on a Saturday, too.

Do you believe the notion – very prevalent at Google – that there is a technical solution for every problem?

(Pauses) My personal opinion is that not everything that is technically possible should be done.

Such as?

Complete monitoring of the individual, registration of all personal data, no right to be forgotten on the Internet. In the digital age, we cannot simply nix all the values we have developed through centuries of debate. I think the need to protect values on the Internet is important, especially in Europe. Transparency doesn't reign supreme. In fact, I feel somewhat fearful about the kind of radical transparency described by "The Circle."

Fearful?

Right now, Silicon Valley is very heavily motivated by the motto: "Everything that is technically feasible is good." The Valley is based on prototypes, trying things out and an absolute faith in technology. This is dangerous. I've heard about companies that say, in all sincerity: As long as it's technologically feasible, we'll do it, even if there are laws forbidding it. They call it "civil disobedience."

Would you also like to see a more in-depth discussion here in Europe over what we do and don't allow?

I'm ambivalent about that. Why? Because I do think that the truly revolutionary is lacking when we modify our products and business models, because we self-censor from the start.

What do you mean by that?

We say: "We can't do that, because our structures don't allow it." Or we say: "We aren't allowed to do that, because there are legal restrictions." As soon as we say these things, we could very well be sacrificing quality and the benefit to customers. We should at least be aware of this.

So are you saying that the people in Silicon Valley are right?

They take precisely the opposite approach. They say that the focus is truly on how things benefit the customer. That's why I'm ambivalent and why I don’t have an answer. I think it's a good thing that we are talking about these issues. I like to provoke this kind of discourse. But breaking the law contradicts my moral values and the way I run a company.

You say we shouldn't rush to keep up with the Americans, and that we don’t need a European Google. But in what area do we still have a chance to develop something new?

If we develop a search engine in Europe, we'll lack the customers and all the data to make sure that the search engine actually works. Facebook has 1.4 billion users, and Google has a 96-percent share of Internet searches in Germany. The chance to develop a model that offers the same quality is very small.

So we missed the boat, it's already gone?

Yes, in my opinion it has. We've been dealt a resounding loss in the first halftime. But there is still a second halftime. Europe is a leader, for example, in software used to control industrial machines. And I also believe that we have strong opportunities in the area of digitizing industry. Silicon Valley has primarily developed solutions for consumers. This is relatively easy and doesn't cost very much.  But we in Europe still have all kinds of opportunities ahead when it comes to solutions for business customers, which are more complex.

In every speech you give, you refer to two numbers. One of them is from America, where an estimated 47 percent of jobs will be eliminated in the next 20 years. The other number is from a study by the Ministry of Labor, which concludes that at least 12 percent of jobs will be eliminated in Germany in the next 20 years. What happens to these people when they lose their jobs?

Perhaps a look at the history books is helpful here. The English queen opposed the hosiery knitting machine in the 16th century out of fear of mass unemployment. From the loom to the steam engine, people have always decried these things as the stuff of the devil. But industrial quantum leaps have always come with a positive employment effect. And when we consider how many jobs software and digitization have created in our society, it seems clear that a new transformation process will also lead to many new jobs and opportunities. We cannot underestimate this transformational effect, which we are experiencing today and will continue to experience in the future. Instead, we need to make allowances for it.

So what does the future hold for us?

The first phase of digitization was about substituting physical labor with machines.

And now it's about intelligence?

Exactly. Take journalists, for example. Nowadays market and sports news can already be produced in an automated fashion. There are attorneys who are being substituted, and there are systems that analyze documents and court rulings and make suggestions for attorneys.

 

 

Do you believe that enough new jobs will be created in the coming decades to offset the ones that will be lost?

People will have to reorganize themselves. Entire occupational categories will be eliminated and entirely new ones created. We have already started training young people to be cyber-security experts…

But we are constantly being told that we need immigrants and refugees in Germany, because we are already unable to fill half a million jobs. Is that a delusion?

No, because we are talking about the here and now. There are qualified jobs that we cannot fill today, such as software engineers for our industry, and we have enormous deficits in classic fields like math and science. This is why the global labor market has become relevant. And then there are jobs that citizens find unattractive on a regional or professional level. There are also jobs for which we have too many trained individuals. But we cannot simply turn a bookkeeper into a software engineer for artificial intelligence. This needs a generational leap.

So what do you propose for this army of the unemployed we are about to see emerge? How are we supposed to preserve social peace?

I don't think much of these threatening scenarios. Just how soon "soon" is isn't quite clear. We are talking about decades, not years. The fact is that we must and can prepare ourselves for change. Instead of facing this development anxiously and cautiously, it's better to actively shape it. There are also opportunities, and we need to take advantage of them so that our social systems will continue to function. These systems preserve the social peace and enable consumers to buy products. The question is how we can preserve these systems! And the answer is perhaps one of the most difficult answers of all, which is why we need to think about unconventional solutions. An unconditional basic income can serve as a basis for leading a decent life.

Do I understand you correctly: Are you a proponent of the unconditional basic income?

It could be a solution – not today and not tomorrow, but in a society that has changed fundamentally as a result of digitization. I try not to think in terms of rigid structures, but to see what is changing in the world and how we could react if things happen the way we expect them to. We need to safeguard our society, which is where the idea of a basic income comes from. We cannot reject such ideas merely because they seem impractical from today's perspective.

The first argument against a basic income is that it could create significant challenges in terms of paying for it. There are estimates that it would cost Germany €80 billion ($87 billion) a month if, for example, every citizen were paid €1,000 a month, as has been proposed. That would amount to annual cost of $960 billion, which is several times the entire federal budget today. Where would this money come from?

You just threw in the €1,000 figure but you're asking the right question. Taxation is based in large part on productivity. In the past, and to some extent today, people produced more added value by working more. This added value was then taxed and the social welfare states were funded with the revenue. If productivity is mainly tied to machines and the analysis of data in the future, taxation could be based more heavily on the resulting profits and less on income tax paid by the individual.

I already see an exodus of companies to other countries.

Yes, and that is precisely one of the fundamental problems. It's already difficult to tax large Internet corporations today, because they can set up their platforms someplace in the world and go via four or five countries.

And yet you still support your funding concept?

Taxing profits is probably the right approach. I think the taxation of data is less feasible and doesn't make a lot of sense. The taxation of machines that guarantee productivity increases could lead to fewer machines being used that would make sense technologically.

A second argument against the unconditional basic income is that it makes society comfortable and lazy, because everyone lacks the necessary drive.

Comfortable and lazy… (pauses). I would be more inclined to see mass unemployment and the resulting lack of prospects as a serious problem. In essence, the goal is to prevent  a complete division of society, with mass poverty on one side and extreme wealth on the other. American academics call this phenomenon the great decoupling. Although incomes have risen overall since the digital revolution, real income in the middle class and in lower income groups is no longer keeping pace with GDP development.

The third argument against the unconditional basic income is that it would lead to growing migration pressure on the few countries that could afford it.

Yes, it would increase. But look at Silicon Valley. We're talking about intentional, qualified, targeted migration. Foreigners have founded half the companies in the Valley. The combination of different backgrounds, languages and qualifications generates a tremendous amount of creativity and new ideas. It's fascinating! But you're right, of course. Poverty migration is a current social issue. The world is becoming more globalized. In my opinion, we don't simply want to say that we're closing the borders and ignoring it.

 

A longer version of this article originally appeared in Die Zeit. To contact the author: [email protected]