Exit Strategy

by Douglas Rushkoff

Genres: Literary Fiction; Spy Thrillers; High-tech & Sci-fi Thrillers

Synopsis

Douglas Rushkoff's latest salvo on complacent media culture, set in 2008, features Jamie Cohen, a young hacker who, like the biblical Joseph, suffers betrayal and then penance before joining forces with a venture capitalist determined to turn everyone into mindless consumers. Meanwhile, Jamie's former pals have developed a way to kill the Web's - and the stock market's - profit-making capacities. A dazzling satire of 1990s dot-com mania, this McLuhanesque cultural critique establishes a new publishing precedent: it is the first "open-source" ebook, annotated by online readers.

Release date: September 15, 2001

Publisher: Grand Central Publishing

Print pages: 375

Sample

For my most devoted reader and mother, Sheila.

 

This wouldn’t have been possible without the incisive and unrelenting guidance of my UK editor, Nicholas Blincoe. I’m also deeply indebted to David Bennahum, Mark Frauenfelder, Brooke Belisle, and Matthew Bialer, whose honest feedback in times of crisis pushed me to say here what it is I really meant to.

Thanks to the Markle Foundation, Zoe Baird, and Julia Moffett, for creating a space and time for me to get this done.

I must salute Jay Mandel and Lisa Shotland at William Morris, who, on being told I wanted to give this book away online, still worked tirelessly on making that vision a reality.

And thanks to Zach Schisgal at Warner Books, for trusting in the power of online collaboration, and believing that the real potential of electronic publishing lies in creating works that are native to the interactive media.

Larry Smith, Scott Alexander, and the staff of Yahoo Internet Life remain this work’s true unsung heroes. They conceived, created, and maintained an Internet home for the “open source” novel project—the heart and soul of this whole endeavor.

A heartfelt thanks is owed to Rabbi Seth Frisch, whose uniquely clear-headed and unencumbered analysis of Torah led me to find something at its core that I now believe to be an indispensable compass for our disorienting times.

This book is also informed, enriched, and inspired by the members of the Media-Squatters mailing list, whose devotion to parsing the real from the illusory has been of immeasurable value to me—as well as quite humbling.

Thanks in advance to all of you who are right now participating in the “Synapticom game” online. You are the reason I wrote this book, and the reason it is now alive.

And, of course, to you, the reader, whose indulgence and generosity keeps us all writing.

 

Since its emergence eleven years ago, the “DeltaWave” manuscript has continued to stir controversy in academic, religious, and, of course, anthro-technology circles. Although forensic evidence strongly indicates that the file was created over two hundred years ago in about 2008, experts have not ruled out the possibility that it was generated much more recently by historical pranksters or even revisionist activists.

Whatever its origin, this text presents us with a unique outlook on the rise of marketphilia in the twenty-first century, as well as the proliferation of reactive architecture in the early Internet Era. It also serves as a rare window on and case study in the Great Capitalist Experiment.

This new Tenth Anniversary Annotated Edition includes explanatory footnotes and primary source data culled from the archival resources of over thirty universities and research institutes. It is hoped that we have made the two-century-old text more accessible to the modern casual reader, while providing the scholarly community with references for additional study.



I wasn’t in it for the money. Honest. I was in it for the game. 1

Maybe it was the setting—that fresh Hamptons 2 air. Or the Merlot. But when Alec’s father offered me a position as a technology researcher at M&L, somehow my job writing the backstories for video games no longer felt like a high leverage point from which to alter the very current of American culture. No, it seemed like the sidelines. Mr. Morehouse was giving me the chance to play for real, in the big leagues. A game with genuine stakes: money. And I knew as long as I remembered it was just a game, I’d be okay. Hell, it was 2008. We’d made it through the Great Correction. Now, everybody knew what was really going on.

I tried to tell myself this a month later as my limo made its way over the Triborough Bridge into Manhattan. There were fresh newspapers—a New York Times and a Wall Street Journal—neatly tucked into the backs of the front seats and a little gooseneck lamp providing light to read them by. A cellular videophone was mounted in the center armrest, its green flashing light indicating readiness. No credit card slot. Just credit, courtesy of M&L. But I figured I was still too new to press my luck. I’d just expensed a laptop and the latest wrist communicator, and didn’t yet know how these things actually got paid for.

The Knicks game was on the radio. A rookie center from Bosnia 3 scored an aggressive slam-dunk, and I figured it was a good moment to break the ice with my driver. I couldn’t get used to having anyone play the servant to my master.

“They finally have a center who can take it to the basket,” I said, hoping that a few exchanges about what the Times in the seat pocket was calling “the new international flavor of basketball” might help me bond with my driver, man to man rather than class to class.

“Yes, sir,” the driver politely agreed in an accent I assumed was Jamaican.

“Like Ewing in his prime.” No response. “You from the islands?” I asked, feeling my own speech involuntarily sliding into a more Third World, 4 almost Caribbean lilt.

“No sir,” he replied. “I am from Zambia.”

“Oh, really? What’d you do there?”

“I worked for the government.”

“As what?”

“I was a computer scientist, actually.”

“Oh.” I tried to hide my surprise—as if driving and programming were equivalent professions. “Do you plan to pursue computer science here, as well?”

“I have been here twelve years,” he said, looking back at me through the rearview mirror.

“But you must miss it, don’t you?”

“I miss the trees. Only the trees. I make more money here driving this limousine, and my children live in a free country.”

“But isn’t Zambia a free country?”

“Not free like America,” he smiled knowingly. “I’m free to earn a living here any way I choose.”

“I work in the industry, myself,” I offered. “Do you have a business card? I know lots of firms looking for people.”

“I was a university professor. My credentials, my Ph.Ds are not accepted here.”

Ph.Ds? Did this guy have more than one? And here I was making a quarter million in salary alone with a single undergraduate degree. I could help this guy. M&L had a whole floor of programmers from Bangalore on H1-G 5 visas, making sixty bucks an hour. It had to be more than he pulled in driving a big black car.

“Really, maybe I can help . . .” But we were already at my destination, a converted warehouse on Twelfth Avenue. The driver handed me a small clipboard with a receipt to sign. I slid one of my new Morehouse & Linney cards under the metal clamp before returning it.

“Thank you, sir,” the man said gently.

“I mean it,” I said, closing the door. “Feel free to call.”

Mine was just one of many black cars pulled up in front of the derelict building. It was the only vehicle with a big number in the rear windshield, though—evidence of an inferior, generic car service. The rest appeared to be private limos. Didn’t anyone take taxis anymore? I changed the trajectory of my approach in an effort to distance myself from the low-status ride.

I got to the velvet rope—the only sign of a working economy on the block—where two young women in tight black sheath dresses were checking names against a list. A trio of over-fifty businessmen argued their case for entry to one of the young judges, who no doubt was working off years of parental issues each time she looked up blankly from her digital clipboard and said, “I’m sorry, but I don’t see your name on the list. Who is it you say invited you again?”

I kept one hand in my trousers pocket, fingering a business card, but as I approached the checkpoint one of the girls gracefully unclasped the velvet rope for me to pass. I didn’t recognize her, and I know she didn’t recognize me. I was simply of the right age, the right style, and the right demeanor to gain admission, no questions asked. I guess I could have been anyone, which is why I had to be treated as if I were someone.

I considered spending my unearned cache on behalf of the elderly businessmen, but it was about to drizzle and I didn’t want to break the flow of my unexpectedly smooth entrance. Besides, they were just suits. Fuck ’em.

Inside was a zoo. A giant concrete room booming with nineties electronica that rattled the huge Mylar sheets hanging from the rafters above. Men in European suits that should have had expiration dates stamped in the collars and women in dresses that either hid or showed off their figures all held plastic cups and shouted at one another. Too much noise and too many people to distinguish anything or anyone of value. And it was hot. I made a mental list of my priorities: One: check coat. —Two: get drink. — Three: Find Alec, my best friend in New York and a walking Rolodex 6 of Silicon Alley.

I saw a long line, composed mostly of women holding coats over their arms, snaking down a staircase to the building’s basement. Just as I took my place at its end, someone grabbed me by the elbow.

“Forget that. Come with me.” Rescue! It was Alec. His straight blond hair was center-parted and slicked back so tight that I almost didn’t recognize him. Not that I had the chance. My slender young escort in the herringbone suit whisked me around the disgruntled line and all the way down the stairs with nary a “pardon me,” past the coat counter to an open door around the back. In one fluid motion, he helped me off with my coat, handed it to the goateed attendant, and slipped a claim check into my breast pocket.

“Never wait in those lines, Jamie,” Alec advised as he took me back up the stairs. “They’re not meant for you.”

“Who’s here?” I asked as we penetrated the pandemonium once again.

“Who’s not?” Alec grinned. “What are you having?”

The crowd pressed against the bar was an even denser mass of unsatisfied humanity than the one on the stairs. They were all desperately trying to hail one of two bartenders, all the while attempting to hide this desperation from one another.

“It’s okay, Alec. I’m not really thirsty.”

“What are you having?” Alec insisted.

“Just a beer is fine. Any beer.”

Alec handed a fifty-dollar bill to a lanky young model holding a silver tray of sushi. “Two gin and tonics, please.”

She glanced at the bar and rolled her eyes. I reached out to take back the bill and let her off the hook, but Alec intervened.

“Thanks, gorgeous, really,” he told her, sending her off into the fray. “She can go behind the bar and make them herself. It’s what she’s paid for, Jamie. Chill.”

“I just—”

“I’ll give her a big tip, okay?” My new partner put his hands on my shoulders. “This is an important party. Try to have fun.”

In my head I was busy reconciling important with fun while Alec dragged my body toward an arrangement of sofas.

“Wait. How will she find us?” I asked.

Alec threw me an exasperated sigh that said “get a grip,” and instinctively surveyed the terrain for a prestigious spot from which to hold court.

•   •   •

Unlike me, Alec knew how to work a party—that much was certain. My entire Princeton experience could well be summarized as having two main phases: Before Alec and After Alec. Entering college as a scholarship student in the computer program, I socialized mostly with fellow hackers. My undeserved infamy as the writer of the DeltaWave virus made me something of a legend among the other nerds, who were mostly public school graduates with outstanding SAT 7 scores. But by my sophomore year, I realized that I was merely in the upper echelon of what amounted to an underclass at Princeton. In an almost unconscious but well-practiced form of self-segregation, we relegated ourselves, along with most of the college’s African-American students, to a small cluster of modern but low-prestige dormitories on the far south side of the campus. Princeton’s ghetto.

The institution’s famous fake-gothic structures on the campus’s north end were inhabited by an entirely different social set. The sons and daughters of successful alumni, southern gentlemen, New York investment brokers, and America’s surviving idle rich somehow found one another before freshman week, and scored places in four-person suites overlooking the slate courtyards and stone archways that were photographed each semester for the cover of the course catalogue. 8 They may have gone to competing prep schools but they were all in the same club now, and accepted one another as brothers.

Determined to rise above my station, I canceled my eating plan at the school’s kosher facility. Utterly dependent on a functioning meritocracy for my entree to collegiate high society, I tried out for lightweight crew and earned a place in the second boat. We rowed together as a single unit, but that’s where any pretense of solidarity ended. Win or lose, after each match, the inner circle of Choate, Andover, and Exeter alums would hop into their cars and drive off to a conveniently undisclosed location, shouting rebel yells through the sunroof.

Still, I held on to the notion that if I could become an indispensable member of the first boat, I might be able to earn my way into their good graces. I went to the boathouse three nights a week and worked out on the rowing machine until the calluses on my palms bled through. While I eventually got a better seat, I never did place out of the second boat. But my efforts put me in the right place at the right time.

Late one night as I labored against the machine’s counterweights, about a half a dozen preppies were throwing a private kegger 9 by the dock. They jabbered on about the various girls they hoped to bed, as well as which ones had herpes and which ones had rich daddies. They got drunker and rowdier, until one of them had the bright idea of dragging the beer keg into one of the shells and rowing out to the center of Lake Carnegie.

When the boat finally capsized, the boys were so disoriented that they barely made it back to shore. The Neanderthals just laughed as they pulled their wet bodies onto the dock, and I wondered why I ever aspired to be accepted by such a moronic tribe.

Then I saw something bobbing up and down in the darkness of the lake that wasn’t an oar, the shell, or the keg. It was a person.

I shouted and pointed. But the soaked and groggy boys only squinted feebly toward the lake, unable or unwilling to consider that there might be a tragedy in progress. So I yanked off my sweatshirt and dove off the end of the pier. Out in the darkness I found a small, panicking blond boy. It was Alec, the sophomore coxswain of the first boat—not a rower at all, but the one who sat in front with a megaphone and kept the pace. He was drowning.

As I approached, Alec panicked, grabbing me by the head and pushing me under the surface. I never believed the instructor in my summer camp’s water safety class when he said this would happen. But now that it was, I used the technique he taught me: Submerge the drowning victim’s head whenever he fights you. A crude behavioral modification through instantaneous feedback that, under the circumstances, worked surprisingly well. Once Alec was sufficiently subdued, I locked an elbow around his chin and towed him back to shore.

By the time he was back on the dock with his friends, Alec was acting as if the whole thing were a joke—that he had lured me out into the water as a prank. I allowed Alec the face-saving ruse. I was done with crew, anyway. But both of us knew what had really happened, and Alec Morehouse wasn’t going to let the guy who saved his life, and, more importantly, his reputation, go unrewarded.

He began inviting me to parties and campus functions I previously never even knew took place. There were banquets for visiting lecturers, cocktail receptions at the Dean’s home for big donors, and alumni events at the Princeton Club in Manhattan. Alec had a gentle grace about him in these situations that made him stand apart from the poseurs and climbers. He’d listen with interest to businessmen as they boasted about their latest investments, and give them such heartfelt approval that they seemed to feed off his every nod. It wasn’t just that his dad was so important—though that might be part of what made Alec so relaxed—it was that Alec genuinely enjoyed other people’s successes. He got off on making people feel good about whatever it was they were doing. He cheered them on.

Me, well, I got off on everyone else’s ignorance—especially about technology. I just loved finding out how all these important men knew so very little about their own industries. And I was still young enough to have nothing to lose by spouting off. On being introduced to the CEO of a retail 10 office-supply chain who had lost millions in his migration online, I sketched out a Web-phone architecture on a paper napkin that would take four steps out of his company’s archaic electronic ordering process. At a fund-raiser for a political candidate, I threw the would-be senator a sound bite about how “new-media literacy means teaching kids about computers, not about software,” which became a constant refrain in his education platform.

Alec gave me access to a new world, and precocious as I was, I gave Alec some intellectual credibility there. We trained one another in the process, and became best friends and roommates—up-campus, of course. I didn’t even have to apply for membership at the 300-year-old Eaves House. When the time for “bickering” arrived—I had been dreading the grueling process for months—Alec got me waved in.

I knew that Alec’s dad was an investment banker, but hadn’t put the whole picture together until I was invited that first time to the family’s compound in the Hamptons for spring break. These were the Morehouses of Morehouse & Linney—one of the top twenty financial firms in the country. Alec had told his parents about the boating accident, and even embellished it a bit so that the Cohens of Whitestone’s absence from the social register would never be an issue. Not that the Morehouses were prejudiced, but a week is a long time at the beach, and balancing an entire guest list is a delicate art. I charmed them in spite of myself, and within a few days they were almost proud that they owed the life of their sole heir to a rabbi’s son from Queens like me.

It was not the only reason Alec’s dad, Tobias, asked me to join the firm—but it was the one still foremost in my mind as I tried to determine just what role I was supposed to play at the Silicon Alley Reader’s monthly soiree. I was only a game designer, after all. And not really a game designer, but a conceptualizer. I dreamed up fictions while other people, real programmers, actually implemented them.

This was no time to lose heart. Most of these people hadn’t even heard of HTML 11 a decade ago, and here they were prancing around as if they had invented the thing. They didn’t know a search engine from a portal, even if they had made more money in a year investing in those buzzwords than my Uncle Morris did in a whole lifetime importing counterfeit chandeliers for the prefab homes of Levittown.

No, I had nothing to fear from the wealthy. Their money didn’t make them confident; it made them scared. Every seven years they lost it all. Seven years of feasting followed by seven years of famine. And these people had mortgages and lifestyles to protect. Personal burn rates that would make a dot-com 12 CEO shudder. Net worths tied up in NASDAQ 13 portfolios that were worth no more than what people were willing to pay at any given moment for the highly speculative securities in them. The superrich were only as wealthy as other people perceived them to be. But that was pretty damn rich, all the same, and I wanted to win some of that perceived worth for myself and then cash in my chips before the game was over again—which I figured would be pretty soon.

•   •   •

“Have you met Jamie Cohen? He’s just joined us at Morehouse,” Alec told the tall young man in an Armani suit and turtleneck who was shaking my hand.

“Didn’t I see you at Comdex earlier this year? Weren’t we on a panel together?” he asked. I didn’t know him, and he didn’t know me. But you could never be sure. “Ty Stanton. IDPP Partners.”

“Pleased to meet you,” I said, slipping into the shmooze groove. “IDPP’s an incubator, 14 right?”

Ty snorted as if this were an insult. Alec laughed nervously.

“The age of incubators is over, Jamie.” Ty fanned out a multicolored deck of business cards.

I felt my intimidation flip into aggression. “Is this a magic trick?”

Ty was unfazed.

“It’s meant to demonstrate our one-to-one philosophy, Jamie.” He used my name at the end of every sentence—a technique straight out of the NLP 15 business books. “Each person gets the kind of card they choose—just like each of our clients, if you can call them that, gets the company they choose. It symbolizes and even actualizes our corporate philosophy: multidimensional, improvisational, and environment specific.”

“Clever,” Alec said, taking a card. “Hmph. I got pink.”

“You chose pink, Alec,” Ty corrected him in the manner of a New Age guru.

“I’ll just take a white one.” I put it in my pocket, and handed Ty one of my own freshly embossed M&L.

“No thanks, Jamie,” Ty said, waving it away. “I never take them. They just make clutter. And I’m good with names, Jamie. Besides, we’re in a lucky position. Any time we need to contact someone they usually find us first.”

I didn’t know whether to take this guy seriously or not. Alec resolved the issue.

“How many of IDPP’s companies have reached IPO,” 16 he asked. “Fifty?”

“Closer to a hundred, actually, Alec,” he replied. “But our function goes well beyond incubation. Each company we launch serves a different and synergistic role in the IDPP family. We have firms that make everything from chips to routers, others that do branding and strategy, some shared-satellite plays, a couple of wireless portals, and of course a full spectrum of e-commerce and shopping aggregators.”

The shotgun approach.

“I guess you’ve got the bases covered.” I tried to be polite.

“That’s just the point,” Ty continued. “We had the same bases covered as everyone else. Our business plan used to be unique. Now it serves as the template for incubators around the world. They’re all getting the same ROI.”

“ROI?” I was expecting a ploy that had become popular in hacker circles in which programmers use fake acronyms to test one another’s BS quotient. If you pretend to understand an acronym that has no real meaning, you expose yourself as uninitiated.

“Return on investment, Jamie.” Ty smiled. “And you’re the one who’s supposed to bring Morehouse into, what was it, the 1980s?” Ty’s barb was delivered perfectly—dangling between insult and humor.

“So you’ve been unsatisfied with your returns?” I offered.

“They’re great, of course, but everyone else is catching up. Besides, once you’re looking at ROI, it means you’re done for. That was the great lesson of 2001.”

“Is that what we learned?” I asked.

“You have to keep your eyes on the prize. It’s our competitive advantage that keeps us in a leadership position. That’s why our CEO conceived the next phase.” For drama as much as sustenance, Ty grabbed a baby quiche off an hors d’oeuvres tray that was floating by him.

“Which is?” Alec took the bait.

“Well, the press release isn’t going out until tomorrow,” Ty said as he picked a tiny bacon bit from between his teeth. “I’m not sure it’s kosher.”

“That’s okay,” I called his bluff. “You better not reveal privileged information.” Companies like IDPP announced earth-shattering paradigm shifts at least twice a week, especially when they had no real news of mergers or acquisitions to report.

“I suppose it’ll be all right . . .” Ty pretended to relent.

“No, really,” I needled him. I was having a good time now. “I don’t want you to break any rules on my account.”

“Look.” Ty tried to retain some intrigue for his revelation. “As long as you promise not to act on anything until the market opens tomorrow.”

“I don’t know, Ty,” I said hesitatingly, as if it pained me. “It’s hard for me to make a commitment like that. At a party and all. I have been drinking, and there’s other people in my firm to think about.”

Alec shot me a harsh glance, like I was pushing this too far. No one spoke for a moment.

“Not bad, Jamie.” Ty took a step back, regarding me as a pecking-order competitor for the first time. “Not bad at all.”

“Thanks.” I was actually grateful to him for helping me get my sea legs. “Now tell me what the hell your CEO decided, okay?”

“Well, since it’s too late to make any real advances in the incubator game, we decided to take it one step further. Basically go ‘meta’ on the whole proposition.” He looked deep into my eyes. “We’re going to be incubating incubators.”

“What?” Alec was confused. “You just said incubators were over.”

“Which is why we took it to the next level,” Ty finished the syllogism.

“I get it,” I said. And, much as it pains me to admit it now, I did. “The struggle is against commodification. The bright idea you have today is the repeatable, mass-produced commodity of tomorrow. Microchips used to be cutting edge—now they’re designed by computers and churned out in Singapore. Then it was computers, then networks, then e-commerce sites, and so on.”

“Right,” Ty chimed in. “Look what e-commerce did to everyone who tried it. Once there was more than one company selling the same thing online, those aggregator sites could create side-by-side comparisons. Prices went down, taking margins with them.”

I felt propelled by something outside myself—like I was on speed. “The whole trick is to get yourself situated in an area with endless novelty,” I raced ahead. “Unique ideas. That’s why incubators became all the rage. Firms dedicated to hatching ideas and spawning them off into new companies. Keeps you ‘in the new.’ ” 17

“Until everyone starts doing incubators, that is,” Ty steered the conversation back toward his paradigm shift. “So we realized we could be the next big thing by generating idea generators, systematically. We’re going to churn out three new incubators every month.”

“And what if someone else starts making incubators?” Alec asked.

Ty seemed stumped by the possibility of infinite regression.

“Well,” I rescued him. “I guess that’s when you go ‘shift paradigms’ again, Ty.”

All three of us laughed. For different reasons.

“So what do you at IDPP?” I asked. “Strategy?”

“Heavens no,” Ty snorted again, and I couldn’t help but notice how huge his nostrils got when he did. “I’m like Alec, here. I do PR.” Then he was off.

That explains it, I thought, as Ty sidled off to glad-hand the marketing director of a banner ad company. He’s just a PR guy. But what made “strategy” any better? This industry wasn’t even running on fumes anymore, but perception. Strategy had more to do with predicting and tweaking image than it did with technology. And the technology that did exist was dedicated mostly to creating images anyway. Another infinite regression. Did anyone really think this would work, or were they only trying to find an easy exit before the next burst of the bubble?

Alec didn’t waste time pondering all this. While I mulled, he snared another executive.

“Was that Ty Stanton?” asked Alec’s next catch—a bald, stocky man in a crisp ventless suit. “He’s with an incubator, now, right?”

“If that includes pretending you’re not an incubator,” I said, holding out my hand.

“Jamie Cohen is our new technology strategist, Karl,” Alec said, elevating my title in the process. “Karl is CFO at Consumer Solutions International.”

“Jamie Cohen, the hacker?” Karl inquired suspiciously.

“In a former life,” I answered as we exchanged cards. The back of his was in Japanese. “You guys have done some great work,” I said, hoping to compensate for my dark-side reputation. “You’ve really made e-commerce sites a joy to use. Put some fun back into the whole genre.”

“Well, thanks,” Karl grumbled, “but who said fun ever fed the colonel’s cat, eh? The more fun they have, the fewer transactions they’re making. There’s only so many eyeball hours 18 in a day, if you can get my drift. No room for growth. The consumer sector is saturated.”

“Better not say that too loudly,” Alec joked.

“So where do you go then?” I wanted to know.

“B to B. Business to business. 19 Exploit margins, create efficiencies, disintermediate all along the supply chain.”

“B to B peaked in ’99,” Alec said. “And again in 2004. Then B to G, then C to C, P to P . . . the cycle is almost over.”

“But there’s a twist,” Karl said. “We call it ‘B to C as B to B.’ Hell, everybody’s in this business, anyway. Look around you. Even people are businesses, so why not treat them as such? It shows them more respect than if they were consumers, lets them participate in the profits, and stimulates brand loyalty that goes off the charts. This way we can focus entirely on reducing risk, enhancing deal flow, and networking externalities.”

“How?” I asked. “I mean, are you making business transactions more like consumer experiences, or the other way around?”

“There’s no difference! That’s the p