COVER STORY • Digital Society — Issues & Challenges • 9

WInterview with Joichi Ito, Director of the MIT Media Lab

ill Digital Technology
Make Human Beings
Happy?

By Japan SPOTLIGHT

Joichi Ito has worked in the IT business since the 1980s, earning a high profile as an entrepreneur who
has founded a number of IT start-ups and as a board member of distinguished companies like The New
York Times Company, the Mozilla Foundation, and Sony Corporation. He currently works as a professor ofMedia Arts and Science at MIT and is director of MIT Media Lab. Born in Kyoto and educated in the UnitedStates, with a variety of international work experience, Ito is one of the most distinguished IT experts inthe world. He gave us his views on the digitalized world and human beings in the following interview.
(Interviewed on July 18, 2018)

Introduction
JS: Could you briefly introduce

yourself and in particular what
the MIT Media Lab is doing?

Photo: Diana Levine

about the interaction between
society, technology, economy
and politics. Firstly, could you
give us your general assessmentof the Fourth Industrial
Revolution upon economy,society and politics?

Ito: I am the director of the Media Lab at
MIT, and I also have an appointment as a
Ito: One key thing is that we are now
visiting professor at Harvard Law School.
struggling with the problems caused by
The Media Lab is about 30 years old, andthe Third Industrial Revolution. If you
we are less focused on any specific field
think about postwar Japan, for example,— it’s more of a process. The important
we spent a lot of our energy trying tothing about the Media Lab is that it is very
become more efficient and producing
applied, and so we only do research that
more things, really trying to rebuild Japan
involves making something, whether it beby increasing production and thebiological or digital or physical. Everything
economy. Any problem could be solved by
we do is project-oriented. The structure is
working hard and being more efficient,
fairly unique in that we are corporate
Joichi Itowhich was well suited to traditional market
funded; we have about 90 companies that
economics and market systems. But if you look at the primaryfund a consortium that we then distribute among projects. We haveproblems that face us today, such as climate change, income
about 800 people, some 250 of whom are graduate students and 300
disparity or social polarization in both the economic and politicalpart-time undergraduates, and 500 projects, ranging from the study
realms, and also health problems — chronic diseases, mentalof learning to music, synthetic biology, robots, AI — there is quite a
diseases — you will find most of these problems are much morerange. I think that the key point is that whether we focus oncomplex than in the past. We cannot solve them with the linear
something that involves humans or machines or society andsolutions we used in postwar Japan.
technology, we approach it in a very interdisciplinary way. My
One of the interesting things happening with the Fourth Industrial
personal research is mostly focused around AI and ethics and law.
Revolution is that we are starting to see that the Internet has lowered
My background is in Internet-related organizations and protocols andthe cost of communication and collaboration and has had a dramatictheir impact on industry and society.
impact on increasing complexity. It also has given us new kinds oforganizations, like Wikipedia or Linux, and enabled political
Fourth Industrial Revolution’s Impact
movements like #MeToo and #BlackLivesMatter to organize with veryon Social & Political Economy
low financial costs. So I think we’re in a very new environment with
JS: So you are definitely the right person to talk withhigh complexity, complex problems and a new way to organize
https://www.jef.or.jp/journal/

Japan SPOTLIGHT • November / December 201837

COVER STORY 9

production. Professor Yochai Benkler at Harvard has a wonderfulpaper titled “Coase’s Penguin”. In it, he explains how the Internet hascreated a new kind of production that we call “Commons-based Peer
Production”, like with Linux or Bitcoin or Wikipedia, where people
assign their own work and work as volunteers. This doesn’t happen
inside of a corporate system, it happens in the commons, the public
realm.
So we have a new type of production, new problems, and a new
way to create organizations. If you add things like AI, we continue toincrease complexity while diminishing the cost of doing many things.
I think that the biggest impact is that we have to change the way wethink about and address society’s problems, and I think that if we
continue to measure our success with things like GDP and othertraditional economic and financial measures, trying to apply thesame tools that we have been using for decades, I think we’re goingto make these problems worse. This is my general assessment.
JS: To be more specific, those new technologies seemto have both positive and negative aspects for the
economy and society. Starting from the negative
aspects, my second question addresses the risk ofalliances between authoritarian states and large datarich IT monopolies. Would this bring about acorporate surveillance system in addition to a statesurveillance system?

Ito: I think the ability to conduct surveillance is clearly becoming
easier — and I know you have a question later about General Data
Protection Regulation (GDPR) by the European Union — but I thinkthat the surveillance state will obviously increase its surveillance.
Since Facebook and Edward Snowden, especially in democratic
countries, the concern about surveillance and privacy has become
quite high, and many organizations and NGOs are starting to trackthese data-rich IT companies and surveillance-related activities, evenoverseas.
For instance, Amnesty International is doing a lot of work to try tounderstand the use of Western companies and their technology inother countries. The big question for me is China. Citizens there
actually mostly support surveillance, and they have some of the best
IT around surveillance — and the Chinese are rapidly gaining a
tremendous amount of influence. While Europe and the US are
struggling with this idea of balancing privacy and IT, China is having
a very different conversation, and we can’t really tell China what to
do — it will decide on its own. Western companies will argue aboutlosing competitiveness due to strictures placed on them bygovernements, but China anyway has its own companies that are
doing a lot of this work. So I think it is a very good question, and it
starts to also connect to cyber security and cyber warfare. This is notanything secret, but the Chinese don’t have the same segmentation
38 Japan SPOTLIGHT • November / December 2018

between national intelligence and corporate espionage. They share a
lot of information between the different groups, whereas in the US,
there is a very strict separation between government and business.
The rules of engagement are quite different for the Chinese as well,
as is the relationship between military and civilian activities. We need
to better understand the Chinese way of thinking from now on.

Impact of the Digitalized Economy on Law
JS: You are also a professor at Harvard Law School.

The digitalized economy does seem to have caused
some legal questions, and so how do you assess theimpact of the digitalized economy upon regulations?

Ito: It was in the mid-1990s, I think, that the Internet was animportant moment. There is a famous argument by Lawrence Lessig
called the “argument about the law of the horse”, where he inessence argued against devising new laws for new technologies
because we’d run the risk of having so many rules no one could keep
track of them, just as judges in the West once had trouble keeping
up with all the laws made regarding horses. I think the argument that
the Internet lawyers made was that the Internet made many things
fundamentally different: jurisdiction, copyright, many legal ideas
were challenged by the Internet. Even in Japan, when the Internet
started, a very famous Japanese legal scholar wrote a long essay
about why the Internet is illegal and why it cannot happen. But it
happened nonetheless, and although it broke a lot of laws, the laws
had to change to adapt to the Internet. So, I think that when we
consider regulations, and let’s take bitcoin as an example, we can try
to make things illegal, but if we can’t enforce the laws we make, or ifthey hurt the technology so much that it can’t benefit society, manyof these technologies will force us to change the law and change theregulations. It has to be an evolutionary relationship between
regulation and law and advancement of technology.
Again, Lessig has identified four areas that have to work together
when considering the law as it applies to technology: one is law, one
is technology, but also one is the market/corporations, and the otherone is “norms” — which are society’s values. If you take something
like self-driving cars, companies want to do one thing, regulators
want to do another thing, people want another thing, and thetechnology is developing regardless of what anyone wants and isalso being researched in universities and other places. There is aninteresting study that we did at the Media Lab where we surveyed
millions of people about self-driving cars, and the conclusion to thequestion of “Should a self-driving car sacrifice the passenger inorder to save more people?” — in other words, if you have toswerve and kill the person in the car to save a group of children,
should the car kill the passenger? — was that everyone says the car
should kill the passenger to save more lives. But no one wants toCOVER STORY 9

buy that car — even though they think that everyone else should.
The point is that when you leave it up to individual choice, people will
make a decision that is selfish, but from a regulatory perspective,
everyone wants society to be more fair and focused on ethics.
So the discussion and decisions about how regulations get formed
has to be a collaboration that is public/private sector and multistakeholder. Europe is doing a more government-centric system, so
the Germans have an autonomous vehicle directive that they havestarted. In the US, the government is kind of leaving leadership tothe companies building autonomous cars, and so I think regulation isgoing to be quite different depending on the country. Similarly, many
countries with digital currencies are trying different initiatives likefinancial sandboxes or government experiments, and actually, Japanis quite progressive. I think everyone is looking at each other’s
regulations to see which ones work the best. But again, in places like
China where they have very different attitudes on these topics, theregulations that work will be very different from the US or Japan. We
will start to see some centralization, but we will also see very
different regulations in different countries, and we will be
experimenting quite a bit.
JS: On the question of the EU’s General Data

Protection Regulation (GDPR), many people seem tobe concerned about this regulation being too strict
and hindering economic competitiveness. Should
there be a balance between privacy and economic
competitiveness?

Ito: I agree that there should be a balance, but I think this balanceright now is in the wrong direction. There’s not enough privacy.
I think GDPR is great, it is a good basic law, and it will evolve. My
concern around GDPR is that big companies like Google andFacebook and others will be able to adapt to it and to lobby it into
something they can work with, while smaller companies will havemore difficulty. So my main concern is that it won’t be hitting thetarget that the Europeans originally targeted, but I do think that it will
have some economic cost. We need to balance that cost, though,because it is very similar in my view to the environment. We haveclimate change because we ignored the climate in order to optimize
our economic gain. Similarly, I think the political and social cost oflack of privacy is higher than the competitiveness of the companies
fighting privacy constraints.
Also, in future I think we will want more privacy, and there is now
a competitive advantage for companies that are now designing theirsystems with privacy-enhancing technology. For example, using new
cryptography — like homomorphic cryptography. These kinds ofcryptographies are used for encrypting data, and for doing researchand doing machine-learning on data that is encrypted. There aresome experiments going on. But places that are required to protect

data will come up with new technology that is privacy robust andthat will be a competitive advantage. The change in the privacy law inthe medium term will start to encourage a new kind of technologythat wouldn’t have been developed if we didn’t have these laws.

Impact on Supply Chains
JS: There do seem to be great benefits from the

Fourth Industrial Revolution, or this big data or the
new technologies that are emerging; one of these is
the possible gains for sales and supply chains. How
do you value these potential gains?

Ito: I think that a lot of the gains that we see from AI and the Internet
are difficult to value from a GDP perspective. Because they are
increasing our ability to learn, or increasing the arts, or justincreasing happiness, they are difficult to measure. I would first saythat many of the gains that we will see are about quality of life rather
than economic benefit. Some studies have shown that above acertain amount, more money doesn’t make you happier; you have tohave other things, like amenities. So I would say that a lot of thevalue of these technologies is intangible.
When we think about supply chains and payment systems such as
blockchain, it may help us address the allocation of capital and also
help us to include people in the economy who currently havedifficulty being included. If we do this well, we will create a systemthat may help reduce income disparity and inequality, allowing
developing countries to participate more. Trade finance, for example,
could benefit greatly from a lot of this work, allowing people toparticipate more in global trade. I can imagine investing directly into
power grids in developing countries, for instance, and being paid
directly using digital currency. I can imagine a farmer depositing his
grain in a warehouse getting a digital certificate he can then use toborrow money before his grain is sold. So I think it will increase
access for individuals at the edge of the network. Again, we will haveto fight for this, but I do think it may help reduce the unfair rents bylarge incumbent monopolies everywhere along the supply chain,from financial systems to logistics and to energy systems likeutilities.
So I think there is an opportunity for quite a degree ofredistribution of power and wealth. Like the Internet, I thinkblockchain will destroy many companies through dis-intermediation
but in the long run it will benefit society and people. The way I would
describe it is, there are companies in a position to extract unfair
rents, and these new technologies will help to make pricing at least
fairer and more competitive. It has to be tied with regulations, but
I think we can help diminish some categories of monopolies.

Japan SPOTLIGHT • November / December 201839

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Role of Education in the Digitalized
EconomyJS: What do you think about the role of the education

system in the Fourth Industrial Revolution?
Education does seem to be very important, but doyou have any comments on the Japanese education
system in this regard?

Ito: I have never participated directly in the Japanese system except
for a few months, so I only have an outside view. However, I thinkthat traditional education, including in Japan, has been aboutteaching a standardized curriculum to make workers standardized
and regular. I think this is valuable when you are trying to make largeorganizations or factories where you need people to have a
predictable set of skills. However, I think that the key thing about the
Fourth Industrial Revolution is that with machines, robots, AI, manyof the regular skills can be done by machines. I think that the humanbeing’s role will be more about creativity, about asking questions,and about being different. Current schools are focused on teachingknowledge and skills, and broadly many of these can be acquired in alifelong learning way when you need them, rather than trying to geteverything done in the educational system. During the period fromfive-years-old to 22-years-old, we should be focusing on helping
people understand ethics, their own passions, learning how to learn,
leaning how to elaborate, learning arts. So I think we need to change
the education system, which is difficult to do because there is awhole chain of vested interests that goes from companies touniversities to schools. So it is quite a political process.
I think that we need to change it fundamentally. If I were to pick
one of the hardest but most important things to change — in a way,
this is quite radical — it would be just getting rid of traditional
education and having more of a project-based learning system where
we use computers and communities to teach the core skills but
without all the structure — this is where we might eventually evolve
to. I think Finland has a system like that.

Balance Between Privacy, Competitiveness &Happiness
JS: Coming back to the question of the right balance

between social concerns such as privacy andeconomic competitiveness, how do you estimate theefforts that have been made so far in achieving thebalance between those two?

Ito: I think we have done a very poor job. Most countries are focusedon economic competitiveness, and I think that even the idea of
focusing on competitiveness is maybe not the right way to think
40 Japan SPOTLIGHT • November / December 2018about the world. In evolutionary biology, there is some great
research now showing that competition is not the most importantcomponent for success in evolution and actually cooperation is more
important. Actually, some of the most interesting traits andcomplexities that we see in nature come from evolution throughcooperation. So I think the idea of economic competitiveness may
have been an important idea when we were struggling with a lack ofabundance, but now we have too much food so we are fat, we havetoo much convenience so we get out of shape — we have a lot of
stuff. We have enough food but it is not well distributed. We haveenough food to feed everyone, but people are dying because we are
not able to distribute it. Our problems are substantially social
concerns and not to do with economic competitiveness.
With Japan, I would be thinking about how do we look after theelderly and how do we increase happiness. The economy needs to behealthy but it does not necessarily have to be growing. The pursuit ofgrowth is important when you are small, but when you are the rightsize, you can instead try to focus on the social issues. It’s like a niceJapanese garden — you don’t try to make everything grow, you try
to make everything beautiful and flourishing. To me, definitely weshould have a healthy economy, but we also should think about
different measures of success. My favorite point I make to nonJapanese is that our economy may not be growing, but we havemore Michelin stars in Tokyo than Paris. So if you measure Michelin
stars as happiness — which I do — we are doing OK. How do wemeasure our success? I think we need to pivot more to the socialside — but I am quite biased!
JS: Do you think that the digitalized economy would

archive economic efficiency and happiness at thesame time?

Ito: I think we can. I would maybe end by saying that one of myfavorite things to think about is Ise Shrine. It has been around forabout 2,000 years, and is sustainable, is beautiful and has a very
nice balance. It doesn’t grow, but it is very active and I think it iswonderful. Ise Shrine is not trying to become more efficient; it istrying to continue its practice. So I think that IT and the newtechnologies can — if we focus them properly — increase our ability
to thrive and increase efficiency, but my concern is that many of ourproblems today — climate, income disparity and health — are notgoing to be solved by more money or more efficiency. They have to
be solved by a different way of thinking, and I hope that is where weapply a lot of this work.

Written with the cooperation of Joel Challender, who is a translator,
interpreter, researcher and writer specializing in Japanese disaster preparedness.