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The Future of the Internet—And How to Stop It » Introduction

Tags: book-online, internet, internet-culture on 2008-04-30 and saved by6 people -All Annotations (0) -About

more fromyupnet.org

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Edge 235

BETTER THAN FREE By Kevin Kelly

Tags: internet, kevin-kelly, network-economy on 2008-03-10 and saved by3 people -All Annotations (0) -About

more fromwww.edge.org

Our wealth sits upon
a very large device that copies promiscuously and constantly.
In a
real sense, these are eight things that are better than free. Eight
uncopyable values. I call them "generatives." A generative
value is a quality or attribute that must be generated, grown, cultivated,
nurtured. A generative thing can not be copied, cloned, faked, replicated,
counterfeited, or reproduced. It is generated uniquely, in place,
over time. In the digital arena, generative qualities add value to
free copies, and therefore are something that can be sold.
Immediacy — Sooner or later you can find a free copy of whatever
you want, but getting a copy delivered to your inbox the moment it
is released — or even better, produced — by its creators is a generative
asset.
Personalization
As many
have noted, personalization requires an ongoing conversation between
the creator and consumer, artist and fan, producer and user. It is
deeply generative because it is iterative and time consuming.
Interpretation — As the old joke goes: software, free. The manual,
$10,000.
Accessibility
— Ownership often sucks. You have to keep your things tidy, up-to-date,
and in the case of digital material, backed up. And in this mobile
world, you have to carry it along with you. Many people, me included,
will be happy to have others tend our "possessions" by
subscribing to them.
The fact that most of this material will
be available free, if we want to tend it, back it up, keep adding
to it, and organize it, will be less and less appealing as time goes
on.
Embodiment — At its core the digital copy is without a body. You
can take a free copy of a work and throw it on a screen. But perhaps
you'd like to see it in hi-res on a huge screen? Maybe in 3D?
Patronage — It is my belief that audiences WANT to pay creators.
Fans like to reward artists, musicians, authors and the like with
the tokens of their appreciation, because it allows them to connect.
But they will only pay if it is very easy to do, a reasonable amount,
and they feel certain the money will directly benefit the creators.
Findability — Where as the previous generative qualities reside
within creative digital works, findability is an asset that occurs
at a higher level in the aggregate of many works. A zero price does
not help direct attention to a work, and in fact may sometimes hinder
it. But no matter what its price, a work has no value unless it is
seen; unfound masterpieces are worthless. When there are millions
of books, millions of songs, millions of films, millions of applications,
millions of everything requesting our attention — and most of it
free — being found is valuable.
From an ocean of possibilities the PSL find, nurture and refine the
work of creators that they believe fans will connect with.
Rather, these new eight
generatives demand an understanding of how abundance breeds a sharing
mindset, how generosity is a business model, how vital it has become
to cultivate and nurture qualities that can't be replicated with
a click of the mouse.
In short, the money in this networked economy does not follow the
path of the copies. Rather it follows the path of attention, and
attention has its own circuits.
I think ads are only one of the paths that
attention takes, and in the long-run, they will only be part of the
new ways money is made selling the free.
Maintaining generatives is a lot harder than duplicating copies
in a factory. There is still a lot to learn. A lot to figure out.
Write to me if you do.
Authenticity — You might be able to grab a key software application
for free, but even if you don't need a manual, you might like to
be sure it is bug free, reliable, and warranted. You'll pay for authenticity.

About Thailand : Internet, Service Providers, Broadband, Wireless Wi-Fi .

Tags: info, internet, internet service providers, isp, thailand on 2007-12-25 -All Annotations (0) -About

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A Cloudbook for the Cloud - Kevin Kelly -- The Technium

Tags: cloud-book, cloud-computing, internet, kevin-kelly, network-computer on 2007-12-08 -All Annotations (0) -About

more fromwww.kk.org

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Kevin Kelly -- Chapter 3: Plentitude Not Scarcity

Tags: book, internet, kevin-kelly, network-economy, technology on 2007-10-02 -All Annotations (0) -About

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Kevin Kelly: The Web Runs on Love, Not Greed

Tags: internet, kevin-kelly, web on 2007-09-03 and saved by2 people -All Annotations (0) -About

more fromwww.scripting.com

Kevin Kelly: The Web Runs on Love, Not Greed
This article appeared in the Wall Street Journal on January 4, 2002.
The Internet is less a creation dictated by economics than it is a
miracle and a gift.
In our disappointment of grand riches, we have failed to see the
miracle on our desks.
The idea of a universal information port was
considered uneconomical, and too futuristic to be real in our
lifetimes.
This abundance simply overwhelms
what was promised by the most optimistic guru.
So much money flew around dot-coms, that it
hid the main event on the web, which is the exchange of gifts.
While
the most popular 50 websites are crassly commercial, most of the 3
billion web pages in the world are not.
The answer to the mystery of why people would
make 3 billion web pages in 2,000 days is simple: sharing.
As the Internet continues to expand in volume and diversity without
interruption, only a relatively small percent of its total mass will
be money-making. The rest will be created and maintained out of
passion, enthusiasm, a sense of civic obligation
or simply on the
faith that it may later provide some economic use.
while millions of
smaller sites and hundreds of millions of users do the heavy work of
creating content that is used and linked. These will be paid entirely
in the gift economy.
Perhaps as more of the world wins access to
it, and more of our books, and movies, and history are added, we will
come to see it as a dream come true, a collective dream created by
people like you and me, sharing what they love.
the heart of this gift
and miracle already beats?
Kevin Kelly: The Web Runs on Love, Not Greed

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Programming Collective Intelligence

Tags: collective-intelligence, emergence, internet, web2.0 on 2007-09-01 -All Annotations (0) -About

more fromradar.oreilly.com

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new rules for the new economy - by kevin kelly - at wired

Tags: business, emergence, gift-economy, internet, kevin-kelly, network-economy, technology, wired on 2007-08-30 and saved by2 people -All Annotations (0) -About

more fromwww.wired.com

New Rules for the New Economy

By Kevin Kelly

Twelve dependable principles for thriving in a turbulent world
The Digital Revolution gets all the headlines these days. But turning slowly beneath the fast-forward turbulence, steadily driving the gyrating cycles of cool technogadgets and gotta-haves, is a much more profound revolution - the Network Economy.

This emerging new economy represents a tectonic upheaval in our commonwealth, a social shift that reorders our lives more than mere hardware or software ever can. It has its own distinct opportunities and its own new rules. Those who play by the new rules will prosper; those who ignore them will not.
Information's critical rearrangement is the widespread, relentless act of connecting everything to everything else. We are now engaged in a grand scheme to augment, amplify, enhance, and extend the relationships and communications between all beings and all objects. That is why the Network Economy is a big deal.
The new rules governing this global restructuring revolve around several axes. First, wealth in this new regime flows directly from innovation, not optimization; that is, wealth is not gained by perfecting the known, but by imperfectly seizing the unknown. Second, the ideal environment for cultivating the unknown is to nurture the supreme agility and nimbleness of networks. Third, the domestication of the unknown inevitably means abandoning the highly successful known - undoing the perfected. And last, in the thickening web of the Network Economy, the cycle of "find, nurture, destroy" happens faster and more intensely than ever before.
As we implant a billion specks of our thought into everything we make, we are also connecting them up. Stationary objects are wired together. The nonstationary rest - that is, most manufactured objects - will be linked by infrared and radio, creating a wireless web vastly larger than the wired web. It is not necessary that each connected object transmit much data.
A trillion dumb chips connected into a hive mind

is the hardware. The software that runs through it is the Network Economy. A planet of hyperlinked chips emits a ceaseless flow of small messages, cascading into the most nimble waves of sensibility.
The net is not just humans typing at each other on AOL, although that is part of it too and will be as long as seducing the romantic and flaming the idiotic are enjoyable. Rather, the net is the collective interaction spun off by a trillion objects and living beings, linked together through air and glass.
We won't wait for

AI to make intelligent systems; we'll do it with the dumb power of ubiquitous computing and pervasive connections.
Every step we take that banks on cheap, rampant, and universal connection is a step in the right direction. Furthermore, the surest way to advance massive connectionism is to exploit decentralized forces

- to link the distributed bottom.
In the Network Economy, embrace dumb power
2 The Law of Plentitude

More gives more
Curious things happen when you connect all to all. Mathematicians have proven that the sum of a network increases as the square of the number of members. In other words, as the number of nodes in a network increases arithmetically, the value of the network increases exponentially. Adding a few more members can dramatically increase the value for all
members.
Each additional account you can persuade onto the network substantially increases the value of your account.
The fax effect suggests that the more plentiful things become, the more valuable they become. But this notion directly contradicts two of the most fundamental axioms we attribute to the industrial age.

First hoary axiom: Value came from scarcity; diamonds, gold, oil, and college degrees were precious because they were scarce.

Second hoary axiom: When things were made plentiful, they became devalued; carpets no longer indicated status when they could be woven by the thousands on machines.
The logic of the network flips these industrial lessons upside down. In a Network Economy, value is derived from plentitude, just as a fax machine's value increases in ubiquity. Power comes from abundance. Copies (even physical copies) are cheap. Therefore, let them proliferate.
Instead, what is valuable is the scattered relationships - sparked by the copies - that become tangled up in the network itself. And the relationships rocket upward in value as the parts increase in number even slightly.
In the Network Economy, scarcity is overwhelmed by shrinking marginal costs. Where the expense of churning out another copy becomes trivial (and this is happening in more than software), the value of standards and the network booms.

In the Network Economy, more gives more.
3 The Law of Exponential Value

Success is nonlinear
Each of these curves (I owe Net Gain author John Hagel credit for these four examples) is a classic template of exponential growth, compounding in a nonlinear way. Biologists know about exponential growth; such curves are almost the definition of a biological system. That's one reason the Network Economy is often described more accurately in biological terms. Indeed, if the Web feels like a frontier, it's because for the first time in history we are witnessing biological growth in technological systems.
value explodes exponentially with membership, while this value explosion sucks in yet more members. The virtuous circle inflates until all potential members are joined.
4 The Law of Tipping Points

Significance precedes momentum
There has always been a tipping point in any business, industrial or network, after which success feeds upon itself. However, the low fixed costs, insignificant marginal costs, and rapid distribution that we find in the Network Economy depress tipping points below the levels of industrial times; it is as if the new bugs are more contagious

- and more potent. Smaller initial pools can lead to runaway dominance.
Lower tipping points, in turn, mean that the threshold of significance - the period before the tipping point during which a movement, growth, or innovation must be taken seriously - is also dramatically lower than it was during the industrial age. Detecting events while they are beneath this threshold is essential
5 The Law of Increasing Returns

Make virtuous circles
The prime law of networking is known

as the law of increasing returns. Value explodes with membership, and the value explosion sucks in more members, compounding the result. An old saying puts it more succinctly: Them that's got shall get.
First, industrial economies of scale increase value linearly, while the prime law increases value exponentially - the difference between a piggy bank and compounded interest.

Second, and more important, industrial economies of scale stem from the herculean efforts of a single organization to outpace the competition by creating value for less. The expertise (and advantage) developed by the leading company is its alone. By contrast, networked increasing returns are created and shared by the entire network. Many agents, users, and competitors together create the network's value. Although the gains of increasing returns may be reaped unequally by one organization over another, the value of the gains resides in the greater web of relationships.
One can take this trend further. We

are headed into an era when both workers and consumers will feel more loyalty to a network than to any ordinary firm. The great innovation of Silicon Valley is not the wowie-zowie hardware and software it has invented, but the social organization of its companies and, most important, the networked architecture

of the region itself - the tangled web of former jobs, intimate colleagues, information leakage from one firm to the next, rapid company life cycles, and agile email culture. This social web, suffused into the warm hardware of jelly bean chips and copper neurons, creates a true Network Economy.
If services become more valuable the more plentiful they are (Law #2), and if they cost less the better and the more valuable they become (Law #6), then the extension of this logic says that the most valuable things of all should be those that are given away.
Because compounding network knowledge inverts prices, the marginal cost of an additional copy (intangible or tangible) is near zero. Because value appreciates in proportion to abundance, a flood of copies increases the value of all the copies. Because the more value the copies accrue, the more desirable they become, the spread of the product becomes self-fulfilling. Once the product's worth and indispensability is established, the company sells auxiliary services or upgrades, enabling it to continue its generosity and maintaining this marvelous circle.
The natural question is how companies are to survive in a world of generosity. Three points will help.

First, think of "free" as a design goal for pricing. There is a drive toward the free

- the asymptotic free - that, even if not reached, makes the system behave as if

it does. A very small flat rate may have

the same effects as flat-out free.
Second, while one product is free, this usually positions other services to be valuable. Thus, Sun gives Java away to help sell servers and Netscape hands out consumer browsers to help sell commercial server
software.
Third, and most important, following the free is a way to rehearse a service's

or a good's eventual fall to free. You structure your business as if the thing that you are creating is free in anticipation of where its price is going.
Another way to view this effect is in terms of attention. The only factor becoming scarce in a world of abundance is human attention. Each human has an absolute limit of only 24 hours per day to provide attention to the millions of innovations and opportunities thrown up by the economy. Giving stuff away garners human attention, or mind share, which then leads to market share.
The conjunction of escalating communication power with shrinking size of jelly bean nodes at collapsing prices leads Gilder to speak of bandwidth becoming free. What he means is that the price per bit transmitted slides down an asymptotic curve toward the free.
In the Network Economy, make virtuous circles.
While it is true that automobiles will never be free, the cost per mile will dip toward the free. It is the function per dollar that continues to
drop.
This is easier to do in a network-based economy because the criss-crossing of ideas, the hyperlinking of relationships, the agility of alliances, and the nimble quickness of creating new nodes all support the constant generation of new goods and services where none were before.
6 The Law of Inverse Pricing

Anticipate the cheap
In the Network Economy, you can count on the best getting cheaper; as it does, it opens a space around it for something new that is dear. Anticipate the cheap.
Almost from their birth in 1971, microprocessors have lived in the realm of inverted pricing. Now, telecommunications is about to experience the same kind of plunges that microprocessor chips take - halving in price, or doubling in power, every 18 months - but even more drastically. The chip's pricing flip was called Moore's Law. The net's flip is called Gilder's Law, for George Gilder, a radical technotheorist who forecasts that for the foreseeable future (the next 25 years), the total bandwidth of communication systems will triple every 12 months.
There is no future for hermetically sealed closed systems in the Network Economy. The more dimensions accessible to member input and creation, the more increasing returns can animate the network, the more the system will feed on itself and prosper. The less it allows these, the more it will be bypassed.
In the Network Economy, bandwidth is not the only thing headed this way. Mips-per-dollar calculations head toward the free. Transaction costs dive toward the free. Information itself - headlines and stock quotes - plunges toward the free. Indeed, all items that can be copied, both tangible and intangible, adhere to the law of inverted pricing and become cheaper as they improve.
One curious aspect of the Network Economy would astound a citizen living in 1897: The very best gets cheaper each year. This rule of thumb is so ingrained

in our contemporary lifestyle that we bank on it without marveling at it. But marvel we should, because this paradox is a major engine of the new economy.

Through most of the industrial age, consumers experienced slight improvements in quality for slight increases in price. But the arrival of the microprocessor flipped the price equation. In the information age, consumers quickly came to count on drastically superior quality for less price over time. The price and quality curves diverge so dramatically that it sometimes seems as if the better something is, the cheaper it will cost.
In contrast, all the most promising technologies making their debut now are chiefly due to communication between computers - that is, to connections rather than to computations. And since communication is the basis of culture, fiddling at this level is indeed momentous.
1 The Law of Connection

Embrace dumb power
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The Network Economy is fed by the deep resonance of two stellar bangs: the collapsing microcosm of chips and the exploding telecosm of connections. These sudden shifts are tearing the old laws of wealth apart and preparing territory for the emerging economy.
Soon, all manufactured objects, from tennis shoes to hammers to lamp shades to cans of soup, will have embedded in them a tiny sliver of thought. And why
not?
Following the free also works in the other direction. If one way to increase product value is to make products free, then many things now without cost hide great value. We can anticipate wealth by following the free.
But the migration from ad hoc use to commercialization cannot be rushed.

One of the law of generosity's corollaries is that value in the Network Economy requires a protocommercial stage. Again, wealth feeds off ubiquity, and ubiquity usually mandates some level of sharing.
In a Network Economy, innovations must first be seeded into the inefficiencies of the gift economy to later sprout in the commercial economy's efficiencies.
In the Network Economy, follow the free.
8 The Law of the Allegiance

Feed the web first
The distinguishing characteristic of networks is that they have no clear center and no clear outer boundaries. The vital distinction between the self (us) and the nonself (them) - once exemplified by the allegiance of the industrial-era organization man - becomes less meaningful in a Network Economy. The only "inside" now is whether you are on the network or off. Individual allegiance moves away from organizations and toward networks and network platforms. (Are you Windows or Mac?)
Thus, we see fierce enthusiasm from consumers for open architectures. Users are voting for maximizing the value of the network itself. Companies have to play this way, too. As consultant John Hagel argues, a company's primary focus in a networked world shifts from maximizing the firm's value to maximizing the value of the infrastructure whole.
What the computer industry calls "standards" is

an attempt to tame the debilitating

abundance of competing possibilities. Standards strengthen a network; their constraints solidify a pathway, allowing innovation and evolution to accelerate.

So central is the need to tame the choice of possibilities that organizations must make the common standard their first allegiance.
Yet, in every network, the rule is the same. For maximum prosperity, feed the web first.
The Network Economy rewards schemes that allow decentralized creation and punishes those that don't. An automobile maker in the industrial age maintains control over all aspects of the car's parts and construction. An automobile maker in the Network Economy will establish

a web of standards and outsourced suppliers, encouraging the web itself to invent the car, seeding the system with knowledge it gives away, engaging as many participants as broadly as possible, in order to create a virtuous loop where every member's success is shared and leveraged by all.
7 The Law of Generosity

Follow the free
Over time, any invented product is on a one-way trip over the cliff of inverted pricing and down the curve toward the free. As the Network Economy catches up to all manufactured items, they will all slide down this chute more rapidly than ever. Our job, then, is to create new things to send down the slide - in short, to invent items faster than they are commoditized.
For consumers, this is heaven. For those hoping to make a buck, this will be a cruel world. Prices will eventually settle down near the free (gulp!), but quality is completely open-ended at the top.
9 The Law of Devolution

Let go at the top
The tightly linked nature of any economy, but especially the Network Economy's ultraconnected constitution, makes it behave ecologically. The fate of individual organizations is not dependent entirely on their own merits, but also on the fate of their neighbors, their allies, their competitors, and, of course, on that of the immediate environment.
Biologists describe the struggle of an organism to adapt in this biome as a long climb uphill, where uphill means greater adaptation. In this visualization, an organism that is maximally adapted to the times is situated on a peak. It is easy to imagine a commercial organization substituted for the organism. A company expends great effort to move its butt uphill, or to evolve its product so that it is sitting on top, where it is maximally adapted to the consumer environment.
First, unlike the industrial arc's relatively simple environment, where it was fairly clear what an optimal product looked like and where on the slow-moving horizon a company should place itself,

it is increasingly difficult in the Network Economy to discern what hills are highest and what summits are false.
An organization can cheer itself silly on its way to becoming the world's expert on a dead-end technology. In biology's phrasing, it gets stuck on a local peak.
The harsh news is that getting stuck is a certainty in the new economy. Sooner, rather than later, a product will be eclipsed at its prime. While one product is at its peak, another will move the mountain by changing the rules.

There is only one way out. The organism must devolve. In order to go from one high peak to another, it must go downhill first and cross a valley before climbing uphill again. It must reverse itself and become less adapted, less fit, less optimal.
This brings us to the second problem. Organizations, like living beings, are hardwired to optimize what they know and to not throw success away. Companies find devolving a) unthinkable and b) impossible. There is simply no room in the enterprise for the concept

of letting go - let alone the skill to let go

- of something that is working, and trudge downhill toward
chaos.
In the Network Economy, the ability to relinquish a product or occupation or industry at its peak will be priceless. Let go at the top.
10 The Law of Displacement

The net wins
Many observers have noted the gradual displacement in our economy of materials by information.
Whereas once the unique dynamics

of the software and computer industry (increasing returns, following the free, etc.) were seen as special cases within the larger "real" economy of steel, oil, automobiles, and farms, the dynamics

of networks will continue to displace the old economic dynamics until network behavior becomes the entire economy.
The accumulated effect of this substitution of knowledge for material in automobiles is a hypercar that will be safer than today's car, yet can cross the continental US on one tank of fuel.
Once we see cars as chips with wheels, it's easier to imagine airplanes as chips with wings, farms as chips with soil, houses as chips with inhabitants. Yes, they will have mass, but that mass will

be subjugated by the overwhelming amount of knowledge and information flowing through it, and, in economic terms, these objects will behave as if they had no mass at all. In that way,

they migrate to the Network Economy.
If money and information flow through something, then it's part of the Network Economy.

In the Network Economy, the net wins. All transactions and objects will tend to obey network
logic.
11 The Law of Churn

Seek sustainable disequilibrium
As networks have permeated our world, the economy has come to resemble an ecology of organisms, interlinked and coevolving, constantly in flux, deeply tangled, ever expanding at its edges. As

we know from recent ecological studies, no balance exists in nature; rather, as evolution proceeds, there is perpetual disruption as new species displace old,

as natural biomes shift in their makeup, and as organisms and environments transform each other. So it is with the network perspective: companies come and go quickly, careers are patchworks of vocations, industries are indefinite groupings of fluctuating firms.
Change, even in its toxic form, is rapid difference. Churn, on the other hand, is more like the Hindu god Shiva, a creative force of destruction and genesis. Churn topples the incumbent and creates a platform ideal for more innovation and birth. It is "compounded rebirth." And this genesis hovers on the edge of chaos.
Ironically, only by promoting churn can long-term stability be achieved.

This notion of constant churn is familiar to ecologists and those who manage large networks. The sustained vitality of

a complex network requires that the net keep provoking itself out of balance. If the system settles into harmony and equilibrium, it will eventually stagnate and die.

Innovation is a disruption; constant innovation is perpetual disruption. This seems to be the goal of a well-made network: to sustain a perpetual disequilibrium. As economists (such as Paul Romer and Brian Arthur) begin to study the Network Economy, they see that it, too, operates by poising itself on the edge of constant chaos. In this chaotic churn is life-giving renewal and growth.
The difference between chaos and the edge of chaos is subtle.
Industries and occupations also experience this churn. Even a sequence of rapid job changes for workers - let alone lifetime employment - is on its way out. Instead, careers - if that is the word for them - will increasingly resemble networks of multiple and simultaneous commitments with a constant churn of new skills and outmoded roles.