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Location: Blogs barton's aggregated blogbarton's business and technical blog |
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| Posted by: barton |
12/7/2008 |
I have been thinking a lot recently about some of the phenomena that
are described and associated with Web 2.0 technologies and the economic
forces behind them. In her book “Web
2.0: A Strategy Guide”, Amy Shuen does a great job surveying
various features and capabilities found in Web 2.0 companies as well as
explaining how these are driven from an economic perspective, sometimes
in ways that are essentially redefining economics, or at least
permanently changing the landscape.
For example, she discusses how financial analysts calculate the value
of Web 2.0 companies using different kinds of metrics than than non-Web
2.0 companies. She explains that financial valuations of Web 2.0
companies are no longer calculated based on earnings multiples but on
new models that were originally designed for subscription-based
businesses such as cable or cell phone services where revenues are tied
to customer fees rather than unit prices. This makes sense, as Web 2.0
companies generally don’t sell products that they make but instead
attract customer bases that in many cases do pay subscription fees.
But for most people, there is a general myopia about the origin and
nature of the underlying phenomena that are emerging from and being
attributed to Web 2.0 companies. That is to say, when ideas become
successful, people who are experiencing for the first time naturally
associate those ideas with the entities those forces came to their
awareness with. But in fact the ideas emerging now and experiencing
success are not new in the same way that touch screens and multi-modal
interfaces existed before the iPhone became popular or, reaching back a
bit but staying within the same theme, Apple did not invent the user
interface. There is a often a significant difference between
popularizing something and inventing it, and that difference can have
the effect of delaying the actualization of the capabilities its
inventor(s) intended.
Vanevar Bush’s 1945 “As We May Think” is a canonical vision for
the machine that helps us think. Ivan Sutherland’s 1959 thesis entitled
“Sketchpad”
presented the world’s first graphical user interface did so with the
aim of “man and computer to converse rapidly”. In the late 1960’s, when
Douglas Englebart had demonstrated the first use of a computer
mouse and fully interactive computer interface, it was his
research goal to utilize computers to augment
human intellect.
Yet ironically, despite these initial visions for the utility such
machines would provide, the mass commercialization of computational
technology has not, to date, gone in the general direction of stimulating
or inspiring people to think better than they did before. In fact, in
many cases, as technologies have made it easier to to more things, such
as publish typographical documents, make music, or create images, an
unfortunate side effect of this additional capability is that people
who do not understand typography have created ugly documents, some very
poorly crafted music has been created, and, thanks to digital cameras
and video, we easily find all sorts of poor quality images.
We now live in a world interacting with people and things, with many of
those things being machines that we built and (which some of us)
designed to help us perform tasks ever more efficiently and easily, or
perhaps to entertain us, or perhaps to help us, as in the case with Web
2.0, leverage our collective and individual intelligence in more
powerful ways. But Web 2.0, as well as all of the other technologies
that we have designed and built, are not in themselves the source of
the changes that we see, but rather one of the means through which the
forces of continual improvement are made manifest in the world.
As Amy Shuen explains the value of “leapfrog links” or “multiple
network effects” or even the simple value of networks through Reed’s law,
it occurs to me that she is describing phenomena of innovation within
the frame of Web 2.0 that are essentially grounded in culture. What
is particularly interesting about the Web 2.0 technologies to me,
especially from the computer science perspective, is that Web 2.0 seems
to be the era of the emergence of user and especially community-centric
algorithms. Whereas former glory went to the likes of Donald Knuth and
his detailed cataloging of all sorts of useful algorithms for sorting
and such, our emergence into a high-performance world of distributed
computing has not invented a new era of credit card processing
systems but instead is reinventing the way we relate to each other as people.
So, while it may have taken awhile, the ideas about augmenting human
intellect are appearing in some high-profile places, many of which have
nothing to do with Web 2.0. We see it more and more everywhere, from
president-elect Obama’s “seat
at the table” memo to the recent front-page article of Fast
Company describing Cisco’s
sweeping organizational changes that emphasize a shift from
“me” to “we”. No more do we read ad infinitum about the problems of
“information overload” but rather we find headlines like “User
Interfaces Rapidly Adjusting to Information Overload”.
For me, the underlying question to ask is not how to we maximize those
forces, but rather, in what directions do we see those forces moving in
and what new forms do we see taking shape as a result of the changes
now in process. This question forces me to consider many possibilities
and outcomes and begin to build mental models that describe those
forces and the ways I see them interact with one another, with us, and
with the world.
I am only beginning to explore what this looks like, but if I were to
try to summarize it, we are witnessing both a shift and a convergence.
The shift is from man-machine interaction to man-machine-man-community
interaction, and as Amy Shuen will tell you, the multiple network
effects have an accelerating effect on the benefits of such a system,
like a sort of implicit positive reinforcement. The convergence is
interdisciplinary, where, for example, many of the ideas embodied in
movements like Agile software development such as
transparency, adaptability, quality, iterative and continual
improvement are now converging with ideas that have been developing in
parallel in other domains such as business management in Mintzberg’s
notion of emergent
strategy, Prahalad and Hamel’s core
competencies and Teece, Pisano, and Shuen’s own dynamic
capabilities.
It is an exciting, dangerous time, full of possibility and extremes.
But perhaps Mintzberg is on to something when he asserts that we are
moving toward a “balanced
society”. We have the tools in hand and are in the
process of forming them into the kinds of tools they need to be to do
the job of reshaping our society. Thus, it appears that the ideas of
those who invented the technologies we use are actually beginning to
take hold in our society. It remains an open question as to whether the
world will collectively augment its intellect or how that should be
measured. The next-generation tools to take these steps are at the
beginning stages of standardization as we see mass adoption of systems
like Flickr, Facebook, and other Web 2.0 companies, but the ability to
innovate itself remains in my mind primarily a cultural
activity.
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