Pitfalls in predicting the future

Many years I wrote a book with the solicitor, Michael Chiswick, called "Electronic Commerce: Law and Practice". The first edition was published in early 1999. At the end of the first chapter I persuaded Michael to let me write a prediction of how life might be just five years ahead i.e. in the year 2004.

When we did a second edition in 2001 we decided to stick to sensible conservative legal analysis since the book was settling down as a useful practitioners textbook. But it was also clear that things were not shaping out in quite the way that I had predicted - so it would have been a hostage to fortune to try and write a piece in 2001 looking forward to 2007. We therefore took out everything I did in predicting the future. We did a third edition a year or so later but, by then the topic was far too big and fast moving to be covered by a book. "Electronic Commerce: Law and Practice" is now long out of print.

Today, in the spirit of 'full disclosure' I have decided to re-release "Sam's Story" - which is what I had called this vision of the future. - from twenty year ago. It show how difficult it is to predict anything about the future - which is probably a lesson for all of us in these fast moving Brexit-focused times.

(Incidentally at the time I wrote "Sam's Story" for the textbook I was in correspondence with John Diamond, the journalist who had recently been diagnosed with throat cancer. John kindly gave me permission to have him reviewing the play "Walking on Water" in the year 2004 even though we both knew that he would no longer be with us by that date. John, who died in 2001, performed an extraordinary service to society and the medical profession by writing about his cancer in his book "C" which was later turned into the play "A lump in my throat" by his friend Victoria Coren-Mitchell.)

Sam's Story

SAM'S STORY

To close this introductory chapter we introduce Samantha Wesley, an assistant solicitor in a City firm in the Year 2004. Sam is an ordinary person, not especially computer literate but able to use computers in her ordinary daily life.

As usual Sam Wesley was already awake and washed as her radio alarm went off. It was raining and the radio confirmed that yesterday's rain sealed June 2004 as being the wettest English June on record. "Some things never change", muttered Sam as she bumped around the bedroom in the darkness trying not to disturb Tom. There was little chance of that she could sleep through a thunderstorm. But the creaking floorboards moved the computer mouse on the work table which mistook them for start up requests and lit the screen up with the list of the day's reminders. Some were work related but most were pleasure. An urgent note flashed "Walking on Water", a reference to the new political musical which was opening at the Prince Alfred Theatre. Sam liked musicals but wanted to see the reviews of this one before committing herself. The temptation was too great. She sat down and clicked on the Electronic Telegraph icon, following the links to the review page.

"Is he waving or drowning?" – John Diamond reviews “Walking on Water". [Short review follows]

Sam read the piece to the end and decided to book tickets. She clicked on the booking link, the screen dissolved and she was at the Prince Alfred Bookings site. Two tickets at 90 Euros in the Front Stalls were available but the order form stated that the view was obstructed. Sam clicked on the "show me" icon and saw a picture of the stage as it would appear from her seat. It was clear that a huge pillar would block the view which in any event was strongly angled. "Not right for such a spectacular". But there were Dress Circle seats available at 105 Euros each and their views were unobstructed. She clicked to make a booking. The computer interrupted "Real or Pseudo Identity?" Was Sam prepared to give the theatre her real name? "Real" clicked Sam — she did not normally mind being known as a theatregoer and getting special offers from the Theatre Bookings website. But sometimes, when on a view for a client, Sam used a Pseudo Identity. She had done so last week when checking out "Maestro" the play about the new Lord Mayor of London which was alleged to libel one of the firm's clients in a scene in a railway station.

The computer interrupted again "Collect Tickets or e-Tickets?" With a real identity, the theatregoer could collect the ticket from the theatre by showing his credit card or could ask for e-tickets which were fully transferable electronic vouchers which were downloaded onto a smart card like digital money and could be transferred from card to card. Only at the theatre when the anonymous smart card was waived before the sensor would the paper tickets be printed and the electronic vouchers voided on the card. The ticket agencies loved them and e-tickets to rock concerts were always high sellers on the Web auction sites. "e-tickets" clicked Sam. A moment later the workstation told her that there were two paid tickets for "Walking on Water" on the hard drive ready for transfer to her Smart Card.

Sam was turning to leave the workstation when a flashing icon caught her eye. It was the stock monitor flashing yellow with no sound, not critical but requiring attention. Sam clicked on the icon to open up her ESI stockwatch. Overnight in Tokyo, Kuji Chemical had announced research collaboration with Lanchester Molecular. Sam had a few shares in Lanchester Molecular in her portfolio and the computer was telling her that the company had been mentioned in news story within the last 12 hours. "I'll hold" she muttered to himself. But this caused her to look at her portfolio. Like most independent professionals Sam liked managing her own affairs. For three years she had been a Sponsored Member of CREST the U.K.'s registration and settlement system, developed by the Bank of England. This allowed her to benefit from all the advantages of electronic settlement of U.K. stocks and shares whilst continuing to keep her name on the company's registry thereby enabling her to receive all the shareholder rights direct from the company. But in recent months Sam had become interested in the revitalised Asian stock markets and had become a private customer of E*TRADE U.K. which allowed her to trade on the Singapore stock market. She reviewed the overnight trading - the U.S. trade figures had had little effect on trading in that part of the world although NASDAQ stocks were down. Looking at the figures changing from one market to the next Sam could almost see the tides of money ebbing and flowing around the world as night followed day.

There was no good reason to sell or buy and Sam, a student of Warren Buffett, always played the long game with her stock portfolio. It was time to get down to work.

And work meant problems. This morning was the second meeting with the receivers of Melvilles – it was hard to believe that the company had gone under despite the popularity of its goods. The Financial Times had called it "'The First Roadkill on the Information Superhighway" and the litigation was predicted to go on for years.

Melvilles were an American department store with a good mail order division. They had gone onto the Web in a big way in the late 1990s mainly selling smart casual clothing under the slogan "The Passport to Pleasure". It had all gone wrong in a spectacular manner.

Melvilles mail order telephone sales operations had been in the Deep South of America taking advantage of low wages and cheap 1-800 services. It had seemed logical to build their web sales operations on the same system. This was their first mistake. The local computer staff did not know of a world outside of Georgia. This mirrored the company: Harvey Melville Senior who had founded Melvilles in the 1940s never had gone outside of America and like most Americans did not have a passport. Melvilles assumed that doing business over the Web was going to be just like their telephone order business in the USA. It was not.

Melvilles problems had started in the Christmas of 1999 when it received a flood of orders from Germany all paid for by credit cards over the Web. It debited the cards and shipped the goods. A large proportion of the goods were rejected because the customer claimed either that he had not ordered the goods or that no agreement to purchase had been made under German law – because of a lack of paper signatures. The German credit card companies refunded all their customers and re-debited Melvilles.

Why had the Germans rejected the goods? The answer lay in a message in a Usenet Group. Melvilles had been the target of a "hate campaign" aimed at the owner Senator Harvey Melville Junior. Senator Melville had been behind a strident campaign in the U.S. Congress which attacked unilateral German restrictions on the import of genetically modified soya beans from the United States. Bavarian farmers, steeped in thousand year old pure barley and water legislation on the quality of beer, believed that American was poisoning Europe for profit. The Usenet message, posted anonymously using a remailer, had outlined a no risk plan to hit Melvilles using pages of genuine credit card numbers and addresses. The highly computer literate German environmentalists and patriots reacted almost instantly by placing thousands of orders for American shirts, pants and linen. Each order was carefully designed to be over $250 and therefore subject to the credit card companies' guarantees against misuse.

The timing was perfect. Melvilles serviced thousands of orders, 97 percent of which were rejected. As the reports started coming back in the Year 2000 bug bit and there was massive data loss of internet records. Then the German Postal Authorities demanded extra storage payments from Melvilles, which was unable to meet them. It dumped the parcels on international charities and, as a result, Latvia ended up with the best dressed refugees in the world. Newsweek called the saga "The Revenge of the Soya" and many hackers claimed to have been the authors of the original anonymous Usenet message.

Melvilles struggled on for a few months more - a patriotic call to U.S. consumers to buy their goods fell on deaf ears — and then sought Chapter 11 protection. They had tried to sue the local law firm who had advised them on their contracts but the action collapsed when it turned out that they had never commissioned any new legal work when they created their website out of their mail order operation. The Web designers who created their site were "code fodder", kids newly out of college who worked on short contracts for peanuts. Melvilles' bankers, all local firms, were protected from the debacle by their agreements — it turned out that Melvilles had never sought explicit permission to take payments from credit cards over the Internet although the local bank managers knew that this was happening.

A final complication arose when Melvilles sent threatening letters to the thousands of credit card customers who had rejected the parcels. Several complaints were laid before the Berlin Data Protection Commissioner who had then instigated an enquiry into the security and auditability of Melvilles' data protection compliance.

But before she could turn to the Melville papers Sam spotted a new item in her business folder from "Starline DNA Testing". Curious, she clicked on the message icon:

Do you really know who your relatives are? Are you really related to someone wealthy who died without knowing of your existence. Every year the IRS benefits from thousands of wealthy people dying without any known next of kin. Instead of the IRS getting rich you might be getting rich.

All it takes is a cotton bud wiped around your mouth and five dollars. Send us the cotton bud, a photograph, your personal details and the money and we will register your DNA on our database. Starline take similar swabs from all dead or dying citizens in all of the United States - our representatives are in every funeral parlour. Once we find a match we will notify you of your lost relative. For 45 per cent of your inheritance Starline provide you with the proof you require to enable you to regain what is yours.

"Junk mail" thought Sam, "nothing can get rid of it — only the messages get weirder." But as she deleted it she pondered was Starline really a front for an illegal human DNA classification project? "Anything is still possible in America".

The doorbell chimed and Sam went down to collect the mail. There was a recorded delivery item - a new smart card. This one was the "CentralServices” smart card – able to hold biometric data. "Hold the package up with the barcode facing the camera", said the Delivery man, taking his time stamped delivery photo. Sam posed, the camera flashed and she signed the touchpad with the stylus. "You will be e-mailed the receipt within ten minutes. Reply to the message and sign it with your digital signature".

Back inside, after drinking a cup of coffee, Sam unwrapped the package. The CentralServices smart card was a multifunction product. It was a credit card, a bank debit card, an electronic purse and a National Identity Card and Driving Licence. It was also useless.

Or at least it was until it was authenticated. Sam read the instructions. 'Plug your card into the PC Card slot in your computer. Older machines may refer to this as the PCMCIA slot. Follow the instructions on screen as we connect you to the Internet for authentication".

The card inserted Sam waited. The CentralServices logo appeared on the screen, a rotating image of the Euro coin which each time it spun displayed a different national version of its face. ''Trying to connect you" said the prompt at the bottom of the screen.

In less than a minute the card got the computer to connect it to the issuer's switching centre. A picture started to appear on screen – it was Sam at her front door holding up the package containing the card. "If you can confirm that this is you please reply to this message using your digital signature. Sam digitally signed the photograph and returned it. Up came the message 'VoicePrint — Read the following sentence in your normal speaking voice'"

Sam read "It was the best of times, It was the worst of times'' The computer prompted “Please confirm that you are not suffering from any temporary medical condition which is altering your voice". Sam confirmed that she was not. Another couple of phrases appeared to be read "Click your heels together three times", "The secret of success is honesty and fair dealing. If you can fake those, you've got it made".

The voiceprint verification ended with a tiny beep: "Your card with be validated for use in 10 seconds. If it is lost or stolen telephone the call centre immediately you discover the loss. Thank you for using CentralServices”. Moments later the computer beeped again. Sam removed her activated smart card then changed her mind and plugged it back in. A few keystrokes later she had transferred her e-tickets to "Walking on Water" onto the new card ready for the show.

Having put the smart card into her purse Sam turned back to the computer to check her e-mail. There was an urgent message from her Cluster Manager, Fabrio Lopez. She clicked on the icon:

"Sam, I need you to take over the Alsace copyright dispute today instead of continuing with the Melville matter. Jimmy tells me that you have got him up to speed on it and thinks he can cope. Alsace is a different matter. Discovery was a disaster - the client "forgot" about the automatic electronic journal on his network which the other side demanded. The Chancery Master has ordered it to be handed over by 4.30 p.m. tomorrow. Tonight I reviewed it and it appears to contradict almost everything we have been told in the witness statements. Thank God we didn't serve them early as I had been minded to do just before the Without Prejudice meeting!

I need you, as a matter of urgency, to make an annotated version of the Witness Statements cross referenced to the Electronic Journal with queries on every entry where the one does not corroborate the other. Remember that Exchange of Witness Statements is due in eight days and we go for trial in the middle of next month.

Here are the files. They are too big for you to work on at home. Toni has pencilled in a video conference with the client to discuss the statements on Friday starting at 6 a.m. (sorry about the hour but the client is in Islamabad).

Regards, Fabrio"

Sam glanced at the size of the attachments. They were massive: far too big to print out. Yet that was not the problem. Electronic discovery meant that she should do the comparison work on screen. To do so lawfully she needed at least a twenty one inch monitor rather than the fifteen inch one she had at home; electronic discovery always required a lot of screen comparisons and could easily lead to excessive eye strain. A 2002 Health and Safety Executive case had ruled that an employer whose employees teleworked had to supply its staff with a safe system of working and this meant that the employee's home workstation had to comply with the minimum E.U. requirements. Failure to require an employee to use a large high definition monitor for electronic discovery applications was a clear breach of the employer's duty under Health and Safety requirements.

This was why Fabrio had said that they were too big for Sam to work on at home. The computer systems with twenty one inch screens were all at Cluster Support H.Q. in town.

Sam started putting on her business clothes ready for the commute. As she sprayed on her perfume she noticed that she was running low in “Reality".

"Reality" by Jean Paul Gaites was the "passionate expression of the next generation”. It was the first totally synthetic perfume made not from traditional flower and animal extracts but in a biotechnology plant at a secret location. The perfume was not available in supermarkets or chain stores but was only stocked in Europe in Business Class boutiques at selected airports and in one store on Faubourg St Honoré in Paris.

But Europe was not the world as the manufacturer has discovered. “Reality" could be bought for one tenth its normal European retail price on the Internet. There was nothing that Jean Paul Gaites could do to stop it save for restricting his sales only to Europe. He had sold a very large shipment of “Reality" to a distributor in India in the belief that India was like the European Union and allowed manufacturers to use European trade mark owners to stop the importation of identical goods sold outside of the European Union. Indian law however was different and had a policy of 'exhaustion of rights’ whereby a local trade mark owners rights were said to be "exhausted" if they were used against goods or services which had been lawfully put on the market by the manufacturer anywhere else in the world. The Indian dealer sold the shipment to SuperNorvge the Norwegian supermarket chain who promptly put it on sale on their website as well as in their stores. Like India, Norway also had international exhaustion of rights as part of its law. By being outside of "Fortress Europe" it was able to cut the best trade deals for its population. As it was also a member of European Free Trade Association (EFTA) there was no lawful way that that the European Union could stop or hinder exports from Norway. If a person bought goods from a Norwegian website it was like them travelling to Norway and buying the goods there.

Sam connected to the SuperNorvge site — an easy task since she had "bookmarked" the page in her browser. "Smart Shopping?" it asked. Sam clicked "Yes" and inserted her new CentralServices card. The list of SuperNorvge goods at discount prices screened endlessly across her display – designer jeans, trainers, exclusive makes of accessories and stockings. "May we update your personal record?" Sam had no worries regarding giving SuperNorvge access to the size-related personal information on her smart card – her body size and personal characteristics — since Norway had one of the toughest data protection regimes in the world. Today it was just "Reality" that concerned her and she ignored the prompt and clicked on "perfume". The site checked her smart card and prompted "Reality". She pulled the perfume bottle icon into the virtual shopping basket and clicked OK. "Your purchase, including express courier shipping, will cost you 97 Euros (including delivery, U.K. import duty and U.K. VAT). Delivery within four hours -- Confirm?"

It was an easy decision to make.