The Next Social Revolution?

Cryofan writes "In a recent interview, Howard Rheingold (author of Smart Mobs) discussed the possibility of a 'new economic system' born of 'unconscious cooperation' embodied by such technologies as Google links and Amazon lists, Wikipedia, wireless devices using unlicensed spectrum, Web logs, and open-source software. Rheingold speculates that 'the technology of the Internet, reputation systems, online communities, mobile devices...may make some new economic system possible....We had markets, then we had capitalism, and socialism was a reaction to industrial-era capitalism. There's been an assumption that since communism failed, capitalism is triumphant, therefore humans have stopped evolving new systems for economic production.' However, Rheingold is worried that established companies with business models that are threatened by these new technologies could 'quash such nascent innovations as file-sharing -- and potentially put the U.S. at risk of falling behind the rest of the world.'"

Comments

Re:Don't worry

[Rosco P. Coltrane]

The rest of us are consumers however much we'd like to think of ourselves as somehow above the comman man. But the fact is we buy our equipment from big corporations. Those big corporations will take whatever steps are necessary to stay in business and prosper.

I know I shouldn't feed the trolls and you're going to get rightly modded down to oblivion after I'm done writing this, but...

Big companies of today will try to keep the way they do business unchanged, until such time as the consumer will grow tired enough of their attitude that they'll vote with their wallets. When that happens, those companies one of two things:

- They will evolve and adopt the way consumers want them to do business, simply because it's in their best interest, if nothing else to survive.

- If they can't evolve, they will go the way of the dodo.

You can see the latter happening to media companies. They had their hayday, and they used to have a purpose, which is distributing intellectual material (music, movies...) by distributing the media they're stored on. Now that technology allows people to share the intellectual material without exchanging the physical media, media companies find themselves with no business case. They're superfluous and struggling to stay alive, but they won't be able to adapt, simply because they aren't needed anymore.

Now, in your example, nobody will need to build computers from scratch, because computer-making companies will adapt to whatever new way of distributing goods emerges. That's because, as you point out, people have a need for someone to manufacture computers for them.

I don't know what the new way of distributing/selling computers will be, and how it will happen, but rest assured that it will happen. The RIAAs and MPAAs of the world however will not be part of the new world, that's for sure. The only question is, how many victims will they make in their downfalls...

"Real" Capitalism

[maggeth]

Actually it sounds more like "Real Capitalism" as opposed to this phoney, monopolistic system we have right now. Innovation is only used when a competitor that you couldn't shut out of the market forces you to keep up (sound like Microsoft?). People will eventually demand real free markets instead of "free" markets built by and run by a few selected corporations who can set up toll booths at their choosing (like the Microsoft tax, for example).

This interview is especially interesting because it outlines some specifics about HOW this can proceed, using technology as a tool to force social progress. Hopefully governments won't start fucking with things to protect their client corporations and realise that everyone needs to adapt. Otherwise they might as well be full-blown communists.

Economic or Social Revolution?

[Keitopsis]

This is sounding like a new way to pass the buck. At the same time, there are far more social implications to these technologies.

What geeks saw in the 80's. College students saw in the early 90s, and what the entire world is waking up to now is that by changing the extent of a single persons ability to communicate, we have a much larger base population for any one society.

It is interesting to note that while large corperations are throwing money at ways to resist economic change, governments and traditional cultures are also trying to resist a "global" society by protecting viewpoints,certain sentimentalities,and cultural identification. Are we seeing a unilateral changes in social-political power structures as well as economic systems?

My $.02, but I think I have change coming.
Kei

There are real issues, but these aren't them

[Animats]

That article sounds like something from the Industry Standard in 1998, during the run-up to the dot-com boom. Been there, done that.

Some real trends worth following:

• Too cheap to bill More things are becoming too cheap to bill for. Or, more specifically, the costs of accounting, marketing, billing, and support functions exceed the cost of the delivered product or service. This happened to the Internet some time back. It happened to long distance calls a decade ago. It's happening to telephony, much to the pain of the telecom industry.

  This isn't a new phenomenon. There are many tangible products where the manufacturing cost is a tiny fraction of the retail price. Soft drinks, for example. Bottled water. Jeans. Batteries. Printer ink. There are successful business strategies for pushing the price up, ranging from heavy brand promotion to lock-in. Just because it could be cheap doesn't mean it will be.

  We're starting to see these strategies applied to the Internet. "SBC Yahoo DSL", and "AOL for Broadband" are examples.

• Unstable markets Some markets are unstable. Electric power. North Atlantic airline tickets. Some commodities. This annoys free-market fanatics no end, but is unsurprising to anyone who understands feedback control system instability. Just because there's an equilibrium point doesn't guarantee the system will settle there. Nor does improving information or reducing delays necessarily improve stability.

  Electric power is a striking example of an unstable market. There's no inventory. Demand is relatively inelastic. Producers have high fixed costs. The result is prices that change by three orders of magnitude within a single day. This huge volatility can be exploited by traders, which makes things worse.

  There's much economic theology around this issue, and not enough theory with predictive power. This area needs more simulation and less pontification.

• The attention shortage There's a major shortage of attention to advertising messages. Advertising people call this "clutter". Advertising has become a near zero sum game, where vast efforts are made to be more visible than competitors. Advertising cost per unit of product climbs until the product is barely affordable. Neither the buyer nor the seller profits from this; it's a pure cost of competition.

• The futility of education Education can be viewed as a way to increase one's value relative to others. As a larger fraction of the population is educated, the relative value of education declines. It may decline to a level below the price of the education. This has already happened with much "job retraining" and computer-related "certifications", and is happening for many fields of higher education. This calls into question the basic concept that higher education is a social good.

• The race for the bottom You know this one. Work moves to very low cost areas. Eventually, those areas do become wealthier, and in theory, everybody wins. But that takes decades. Moving work to low-cost areas now takes only months. This speedup has produced the offshoring movement.

Now these are the real issues in postmodern capitalism. Not peer to peer networking.

Re:There are real issues, but these aren't them

[ReciprocityProject]

The futility of education Education can be viewed as a way to increase one's value relative to others. As a larger fraction of the population is educated, the relative value of education declines. It may decline to a level below the price of the education. This has already happened with much "job retraining" and computer-related "certifications", and is happening for many fields of higher education. This calls into question the basic concept that higher education is a social good.

Whoa. I hope that was a semantic error, and that you really meant, "This calls into the question the basic concept that higher education is an economic good [for the individual worker]. (I was about to mod you up but had to reply instead.)

Education offers important benefits other than increasing one's economic value. You need an education (by which I do not mean an indoctrination, an education-that-is-not-an-indoctrination being admittedly very, very hard to come by) to vote intelligently on issues like the economy, environment, energy, and foreign policy. Most of our voting populace is incompetent to make decisions as voters.

Note that I would never advocate actually restricting someone's right to vote based on whether they have a diploma, or any similarly-spirited criteria, but most of the people voting in the upcoming election will vote for the person who will "fix the economy" and "do the right thing in Iraq," not only without an understanding of the intricacies of those situations, but without an understanding that intricacies actually exist that need to be understood.

For a demonstration, go out on the street and ask about the relationship between Turkey and Iraq, or between interest rates and inflation, or the drop in biodiversity over the last 300 years, or the vulnerabilities in combat of the "Stryker" tank, or what happens if we never pay off the national debt, or what a nuclear winter is.

The irony, I think, is that while we're one of the most "over-educated" countries in the world, we're killing ourselves through our own ignorance. It's a catastrophe.