Silicon Valley is getting into the snooping business
men early September New Yorkers may have noticed an unwelcome guest hanging around their parties. By the end of Labor Day weekend the New York Police Department (NYPD) would use drones to investigate complaints about concerts, including backyard gatherings. Snooping police drones is an increasingly common sight in America. According to a recent study by researchers at Northwestern Pritzker School of Law, about a quarter of police forces are now using it.
Even more surprising is where the technology comes from. Among the NYPDThe providers are Skydio, a Silicon Valley company that uses artificial intelligence (AI) to make drones easy to fly, allowing officers to control them without much training. Skydio is backed by venture capital Andreessen Horowitz (VC) giant, and Accel, one of his peers. The NYPD also buy from BRANCH, another startup, which makes flying machines equipped with night vision cameras that can break through windows. Sam Altman from OpenAIthe beginning behind ChatGPT, is among BRANCHare investors.
It may seem strange that Silicon Valley helps enforce America’s law on troublemakers. Supporting state surveillance sits oddly with the libertarian values espoused by many American tech luminaries who came of age in the early days of the Internet. Although Silicon Valley began supplying chips for the American defense industry in the 1950s, its relationship with the state declined as attention shifted from self-guided missiles to e-commerce and iPhones.
Now, as the technology industry seeks new growth frontiers, selling to the state is coming back into fashion. Government is “the last holdout left from the software revolution”, wrote Andreessen Horowitz’s Katherine Boyle in a blog post last year. Earlier this year the company launched the “American Dynamism” fund to invest in government-related businesses. Slowly but surely, the state is being dragged into the digital age. At the end of 2022 the Pentagon awarded a $9bn cloud computing contract to Alphabet, Amazon, Oracle and Microsoft, four tech giants. Last year 11% of the value of federal contracts awarded to businesses was for software and technology, up from 8% a decade ago, according to The Economistto calculate.
Surveillance is one government activity that is being modernized. New technologies for observation and analysis are changing the field. Incumbent providers such as Axon Enterprise and Motorola Solutions, which sell cameras and multiple surveillance gubbins to police and other security agencies, are joining upstars pushing whizzier technologies.
The first of these is drones. That industry has been under control DJI, a Chinese manufacturer that last year supplied nearly three-quarters of the drones sold in America. This has caused much hand-wringing in American government circles. On November 1st a bill was introduced in Congress that would prohibit all federal government departments from purchasing Chinese drones. Some states, including Florida, have already banned emergency services from doing so. All this benefits the likes of Skydio and Brink.
Other types of aerial snooping equipment are also in the works. Skydweller, another startup, is developing an autonomous solar-powered aircraft that doesn’t need to land to recharge. That would allow, the company says, for “ongoing investigation”.
The second increasing technology is satellites. SpaceX, Elon Musk’s rocket company, and its copycats have helped reduce the price of sending things into space to about a tenth of the level two decades ago. That has led to the carpeting of low Earth orbit with satellites, about an eighth of which are used to observe the planet. PitchBook, a data company, estimates that nearly 200 companies are now involved in selling satellite imagery – so many that the market has taken off, according to Trae Stephens of Founders Fund , another man. VC firm BlackSky, one of those companies, says it can take a picture of a spot on Earth every couple of hours. Satellite imagery has come a long way since 2013, when police in Oregon used images from Google Earth to find an illegal marijuana plantation in a resident’s yard.
Technologists are also selling tools to help law enforcement make better use of the images and information now at their fingertips. Environmental.AI, another startup backed by Andreessen Horowitz, has developed technology that automatically monitors cameras for suspicious activity. Palantir, a data mining company that has inserted itself into the American military-industrial complex, sells its tools to the likes of the Los Angeles Police Department.
Facial recognition software is now more widely used across America, too, with about a tenth of police forces having access to the technology. A report released in September by the US Government Accountability Office found that six federal law enforcement agencies, including the F.B.I and the Secret Service, together conducting an average of 69 facial recognition checks per day. Among the top vendors listed was Clearview AIa company backed by Peter Thiel, a VC veteran
Vigilance abilities may be further enhanced by generation AIthe kind that powers ChatGPT, due to its ability to work with “unstructured” data such as images and video footage. Will Marshall, the head of Planet Labs, a satellite company, says that analyzing satellite images with the technology will allow users to “find things on Earth”, while Google allows users to search the Internet. for information.
For newcomers, selling smart new surveillance technologies to the government isn’t easy. Rick Smith, head of Axon, says there are 18,000 police departments in America. A fifth of them do not use electronic records. Until 2009, the NYPD he was still buying typewriters.
For newcomers who get a foothold, the rewards can be rich. David Ulevitch, who runs Andreessen Horowitz’s American Dynamism fund, points out that word of mouth can spread quickly, creating “virality”. Fusus, a startup that sells real-time crime detection software, says its sales grew more than 300% last year, albeit from a low base. In 2017 Flock Safety, another startup, launched a license plate reader that is now used in 47 American states. Also, note General Catalyst’s Paul Kwan, another guy VC solid, relationships with government buyers, once established, tend to last a long time.
The big companies are changing. Motorola Solutions has had 15 acquisitions since 2019, including Calipsa, a video analytics tool, and WatchGuard, which makes cameras for police dashboards. Axon has also acquired startups and taken stakes in others, including Fusus and Skydio.
The use of a new technology wizard to the task of watching citizens will be very uncomfortable. In 2020 Amazon, Microsoft and IBM stopped providing facial recognition services to law enforcement agencies due to privacy concerns. But surveillance is likely to remain profitable, especially since governments are not the only customers for these technologies. Skydio drones assess cell towers and bridges for damage. Hedge funds use satellite imagery to count the cars in a dealership’s parking lot, hoping to gauge their revenue before it goes public. SmartEye, a Swedish company, sells eye-tracking technology to track the emotions of pilots. It also sells its products to advertising companies. The trend towards increased scrutiny, whether by big brother or big business, is likely to be irreversible. ■
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