The hook to every song sung at Davos is “jobs, jobs, jobs.” The chorus of machers on stages here operate under an article of faith that growth can come back, that they can stimulate it, that that will create jobs, and then that all will be eventually well.
What if that’s not the case? I am coming to believe, more and more, that technology is leading to efficiency over growth. I’ve written about that here.This notion is obviously true in some sectors of society: see news and media, retail, travel sales, and other arenas. But how many more sectors will this rule strike: universities? government? banking? delivery? even manufacturing?
As I write this, I’m watching a WEF panel moderated by Reuters’ editor, Steve Adler, with Larry Summers and government and business leaders. They’re discussing growth strategies and so far we’re hearing the same notions we hear elsewhere in Davos, the complete trick bag: spend money on infrastructure, be nice to business, regulate less, reform taxes, reform immigration. OK and OK.
“The problems of job creation are more complicated than that. They are more complicated than wealth creation,” says one of the panelists (operating under Chatham House Rule, so I won’t attribute*). “This is a group that understands wealth creation better than job creation.” He says “there are inherent limits” to the number of people employed in various sectors.
I haven’t heard any strategy yet that reverses the trends underway in the transition from the industrial economy to the digital economy. What will offset the shrinking of vast industries? New industries? Well, we have new, digital industries, but they are even more efficient than restructured old industries. Compare Google’s staff size to GM’s, even now. Facebook serves almost a billion people with the staff the size of a large newspaper. Amazon employes far fewer people than the bookstores it put out of business did. So those new industries will bring growth, profit, and wealth, but not many jobs.
“There are fewer jobs for regular people because those innovations happened than there would have been if those innovations hadn’t happened,” the panelist says. It would be “a delusion” to think that encouraging this innovation will increase jobs.
So what if the key business strategy of the near-term future becomes efficiency over growth? Productivity will improve. Companies will be more profitable. Wealth will be created. But employment will suffer.
I’m hearing no strategies focused on this larger transition in a gathering about the transition. I think that’s because the institutions’ trick bags are empty. They ran an industrial society. That’s over. And the entrepreneurs who will create new companies but also new efficiency aren’t yet in power to solve the problem they create.
I ask the panel whether all this talk of jobs, jobs, jobs is so much empty rhetoric. I ask whether there are other tricks in the bag.
The panelist I’ve been quoting says that there are two sets of economic issues: In the short term, for the next five years, we are dealing with demand and macroeconomic policy. “Employment today has nothing to do with the Kindle,” he says. “It has everything to do with the financial system, deleveraging, and macroeconomic policy.”
It’s in the long term that the issues I’m addressing here come to bear. “For the longer term, we don’t have nearly as good answers as we would like to,” he says. “We are going to have to embrace the idea that we are going to have growing numbers of people involved in the provision of fundamental services to other people, services like health care and education. We’re going to need to make that work for society.”
That is to say, health and education don’t directly create wealth; they are services funded in great measure by taxes of one sort or another. Employing people in those sectors amounts to a redistribution of wealth with the fringe benefit of providing helpful services. Is a service-sector economy the secret to growth? Who pays for that when fewer people have jobs in the productive economy? I still don’t see an answer. This is not an economic policy so much as it is a social policy.
Another panelist says that we will have fewer people and we will need to retrain people throughout their lives for new jobs. I agree. But that doesn’t create jobs (except in schools); it just helps fill the ones we have.
One more panelist, from Europe, suggests that nations here will end up making stuff for the growing economies and consuming middle classes of China, India, Brazil, etc. In a globalized world with maximum price competition, I’m not so sure that’s a strategy for growth, only survival. I’d hate to place my strategic bets on continuing — or returning to — the industrial economy. And at some point, that strategy bumps up against the question of sustainability: is there enough stuff to go around?
Indeed, in a globalized society, we need to look at total jobs, the sum of work and productivity and demand, not country-by-country. The question is: Will jobs on the whole increase in this digital economy?
If instead efficiency increases — and with it, again, productivity and profit — then great wealth can be created: see Google, and the technology economy. But that means the disparity of income and capital will only widen yet more. And it’s just wide enough today to cause unrest around the world. That’s much of what #Occupy_WEF et al is about. That’s what is causing such tsuris and uncertainty on the stages of the world (Economic Forum). That’s what is causing the institutions represented here to fear, resist, and regulate technology in the hopes of forestalling the change it is bringing. There is the root of the disruption we’re witnessing now even in Davos.
* I saw Summers later and he gave me permission to quote him by name. He is the quotable panelist.
The New York Times raised its daily price to $2.50 today. I thought back to the penny press at the turn of the last century and wondered what such a paper would cost today, inflation adjusted. Answer: a quarter.
So, in inflation-adjusted current pennies, The New York Times today costs 10 times more than a newspaper in 1890. Granted, Today’s Times is better than a product of the penny press. But is it worth 10x? Should it cost 10x?
In the meantime, labor rates have risen (a Timesman today lives better than a Timesman then) but production technology has become far more automated and efficient (no more typesetters, proofreaders, compositors, engravers, stereographers, mailrooms, or “rubber rooms” filled with unneeded pressmen). And the advertising value of newspapers has increased exponentially.
On the one hand, there’s less competition today. The New York Times is essentially a national newspaper monopoly (the Wall Street Journal and USA Today are different beasts). That should enable it to raise its price to such a premium. On the other hand, what’s really at work, of course, is that there’s much more competition today: the entire web. That would drive the paper to lower its price.
Instead, today it raises its price — by a whopping 25% over its old daily price of $2. That’s because it is trying to support an outmoded economic model. The myth of legacy media — rich while it lasted — was that every reader saw every ad so the paper charged every advertiser for every reader. That’s how scale paid off. Those are the economics that led to the rise of the penny press.
Online, that myth has been punctured: (a) every reader does not see every ad, and (b) advertisers pay only for the ads readers see (or in Google click on), and (c) there’s abundant competition. That’s what confounds legacy media folks: “If I get more audience and have more effective advertising, why am I not being paid more?” Because you’re operating by media laws that are now outmoded. You’re still operating under an industrial economy built on scarcity. That’s what makes you think you still have pricing power.
You need to find opportunity in entirely new models, in the new scale, in abundance. Google finds value in scale by taking on risk for the advertiser (who pays only for clicks) and by increasing relevance by putting ads everywhere. Facebook finds value in relationships and data about them and it doesn’t sell content but does use content as a tool to generate more data about users and their interests.
In their day — a century ago — newspapers found new ways to exploit scale. Today, net companies exploit scale in new ways. Google, Facebook, and Twitter are the penny press of today. Only they cost even less.
BTW, thanks to the very good Times Machine, we can see that The Times started life at a penny, which rose to four cents and then back down to a penny by 1900 — because it wanted scale.
It is time for Twitter and its citizens to take back #OccupyWallStreet.
I say that with no disrespect to the efforts and sacrifices of the people who have taken the hashtag literally and moved into Wall Street and cities around the world, confronting the institutions — financial, government, and media — they blame for our crisis.
To the contrary, I say it’s time to carry their work back to our virtual society, where it began, to expand the movement so Michael Bloomberg and his downtown goombas and mayors and cops cannot think that they are able throw it away in a garbage truck; so banks cannot hope to return to their old ways; so media cannot think that it can dismiss #OWS as fringe (see the BBC and the FT each calling the movement “anti-capitalist” when many of us say the real goal is to reclaim capitalism from its crooks).
It is much bigger than the scores of occupants in each city. But that still raises the question of what “it” is.
That is where I believe Twitter can grow and give shape to the movement. There we can answer the question, What are we mad as hell about (should that be a hashtag debate: #why…)? There we can organize no end of irritants for institutions (we can play whack-a-mole with the banks’ rip-off fees and leave them as customers). There we can hold politicians to account.
Some have argued that #OWS will not grow up as a movement until it becomes an institution and has leadership and spokesmen and unified goals and messages and even candidates for office.
Heaven forbid.
#OccupyWallStreet, in my view, is anti-institutional in that it is fighting institutional power and corruption and in that it is not an institution itself. I believe the value of #OWS is that it enables us to say how and why we’re angry and to make the powerful come to us and beg us for forgiveness, not to join their games.
#OccupyWallStreet, the hashtag revolution, establishes us, the public, as an entity to be reckoned with. It is a tool of publicness.
So I support #OWS becoming less literal — let Michael J Bloomberg tear down the tents — and more amorphous, more difficult to define and dismiss and shut down.
#OccupyWallStreet started on Twitter and spread to the streets. Now it’s time come back online and spread further.
Why are you mad as hell? And what are you going to do about it? That is #OWS’ challenge to us all.
Consider: I a matter of a year, the leaders of Italy, Greece, Libya, Egypt, and Tunisia have all been ousted not in the normal course of governance and not at the polls. Who’s in charge there? In the Middle EAst, it’s the people, at last (but can they retain power?). In Europe, its bondholders and neighboring nations. Meanwhile, in Spain and the #occupywallstreet movements, disgruntled, disorganized citizens are making their voices heard. In Iceland they’re rewriting their constitution using Facebook.
What is becoming of our notion of nations?
In the Frankfurter Allgemeine Zeitung, Georges Papandreou’s short-lived threat to hold a plebiscite over the EU’s insistence of austerity as a condition of bail from fiscal jail set off a debate among the paper’s editor, Frank Schirrmacher; the esteemed political philosopher Jürgen Habermas, and economic writer Rainer Hank.
Far be it from me to translate the language or its subtleties and ironies, but it’s clear that they are debating who’s in charge in Europe: government? bond-holders and bankers? the people? Hank notes that “the governments of Europe are under dual supervision.” He questions whether Europe is facing “dictatorship of the people versus dictatorship of financial markets” or a question of “democracy versus rule of law.”
At the same time I (tried to) read all that, Martin Gurri wrote a most eloquent review of and rumination on Public Parts (his son, Adam, happened to do likewise). Gurri père raises many thoughtful points about the value of publicness and its support of trust. I recommend reading both posts. But for purposes of this discussion, I want to focus on Martin Gurri’s trepidation about government. To quote:
In the existential struggle between the public and the old structures of authority, Jarvis is a participant, not an observer. At times, he makes it sound as if the public can bypass authority and strike out on its own. The larger argument of Public Parts, however, is that the conflict can only be resolved when authority regains the public’s trust by aligning its practices with those of the new information environment. Though optimistic in tone, Jarvis doesn’t directly venture an opinion about the cost of this transformation, possibly because he views it as inevitable. In the manner of a conqueror he proclaims, “Resistance is futile.”
It’s an easy guess that the collision with the public will transform the old institutions. The question is the social and political pain involved: whether the process will resemble gradual evolution or, as I suspect, an extinction event. (There are those who theorize that such a cataclysm has already struck the global economy.)
Because of their immense inherited weight, business and government have a vested interest in inertia. In this context, resistance may be futile in the long term, but rational for the moment. As an old government hand, I can attest to the accuracy of Jarvis’ portrayal of the bureaucracy – but he fails to note the profound emotional investment in existing institutions by the people who inhabit them. Even the most up-to-date bureaucrats, in my experience, will resist the advance of the public until retirement day.
Bending the massive structures of authority to the ideals promoted in Public Parts may well be impossible without a traumatic fracturing of the status quo.
And a traumatic fracturing of the state itself?
That is the question I want to raise here: Are we seeing such cracks begin to open before our eyes?
Is Europe’s crisis of economics and government structure — even of the legitimacy and power of government — a signal?
Is the Arab Spring and its ability to tear down government without a clear notion of what will be built in its place an opportunity to rethink government?
Is Iceland as a startup nation a legitimate effort to show that course?
Did Spain attempt to organize a revolution without organization?
Is #occupywallstreet an effort to reassert the authority of the people outside the structure of politics and government? (Some say they make a mistake not becoming overtly political with candidates and platforms. I am coming to believe they are right to stand outside government and demand attention and reform from that distance. Its platform perspective might be: ‘We don’t want to get any on us.’)
Will we question the idea of what a nation is? Are Greece and Italy still sovereign nations when bankers can overthrow their governments and neighbors can dictate the terms of governance? Are the hashtag rebels of Spain then the U.S. then other nations establishing a new society (albeit one even more unsure in its structure than Egypt’s and Tunisia’s next forms)?
Says Gurri Senior:
Particularly unsettling are the prospects for government. The extraordinary outcomes today demanded from politics, Paul Ormerod has shown, lie beyond the reach of human power. We simply don’t know how to “solve” unemployment or inequality. The more we expect to impose such outcomes on a complex world, the deeper our disenchantment will be. Transparency and citizen participation, in such circumstances, will only aggravate the friction between a triumphant public and its failed institutions. Modern government, outwardly so imposing, will be revealed in its nakedness to be a feeble and incapable organ, unable to rise to the hopes of the citizenry. The consequence is likely to be turbulence for every ruling principle, including liberal democracy.
Gurri might have begun wondering whether I went to far. Then he went even farther.
#OccupyWallStreet has been drawing complaints that it doesn’t have a demand and a goal. But I say that is precisely its significance.
#OccupyWallStreet is a hashtag revolt. As I learned with my own little #FuckYouWashington uprising, a hashtag has no owner, no heirarchy, no canon or credo. It is a blank slate onto which anyone may impose his or her frustrations, complaints, demands, wishes, or principles.
So I will impose mine. #OccupyWallStreet, to me, is about institutional failure. And so it is appropriate that #OccupyWallStreet itself is not run as an institution.
We don’t trust institutions anymore. Name a bank or financial institution you can trust today. That industry was built entirely on trust — we entrusted our money to their cloud — and they failed us. Government? The other day, I heard a cabinet member from a prior administration call Washington “paralyzed and poisonous” — and he’s an insider. Media? Pew released a study last week saying that three-quarters of Americans don’t believe journalists get their facts straight (which is their only job). Education? Built for a prior, institutional era. Religion? Various of its outlets are abusing children or espousing bigotry or encouraging violence. The #OccupyWallStreet troops are demonizing practically all of corporate America and with it, capitalism. What institutions are left? I can’t name one.
In a Foreign Affairs essay in 2008, Richard Haass argued that the world is moving from bi- and unipolarity (that is, the Cold War and its aftermath) to nonpolarity (i.e., no one’s in charge). “We now operate in an open marketplace of influence,” I wrote in my last book. “One need no longer control institutions to control agendas.”
Now one needs a network. #OccupyWallStreet is that network, the headless tail. Even it’s not sure what it is. Indeed, I think it would have been better off not issuing a manifesto written by a committee of the whole park, going after even animal rights and ending with its own Ninth Amendment: “*These grievances are not all-inclusive.” Henry Blodget mocks many of their demands. Feminisnt says they aren’t specific enough. They can’t win.
But I think they are already winning. #OccupyWallStreet is a start and it is growing, as Micah Sifry wrote: “There’s something happening here, Mr. Jones.”
What’s happening is an attempt to define a new public, now that we can. Iceland, Tunisia, Egypt, and Libya are all countries being reimagined and remade: start-up nations. Hear Icelandic MP Birgitta Jonsdottir talk about building a new constitution, using Facebook, on the principles of “equality, transparency, accountability, and honesty” — liberté, égalité, fraternité, updated for the networked age.
In the end, this is why I wrote Public Parts, because we have the tools and thus the opportunity to rethink and reorganize our publics and decide what they stand for. The power and freedom that Gutenberg’s press brought to the early modern era, our networked tools now bring everyone in this, the early digital age. “They empower us. They grant us the ability to create, to connect, to organize, and to aggregate our knowledge…. They lower borders, even challenging our notion of nations.” That’s what the youth of these countries are doing.
Media have mocked the denizens of #OccupyWallStreet as scruffy, young hippies. But you should have seen me — and more of media’s bosses than you can imagine — in ‘68. Scruffy, simplistic, bombastic, angry, determined, self-righteous, right, and high — that was us. Media dismissed us just as they dismiss the denizens of Zuccotti Park. Authorities thought they could round up all the ‘68ers in Grant Park, just as they do now on the Brooklyn Bridge.
When I visited #OccupyWallStreet’s park Friday, I wore a sport coat. I had to because earlier that day, I had a meeting at a place where they wear them. But I’m glad I brought it, for it’s time to show that #OccupyWallStreet represents more than scruffy young leftists. I don’t say that for a moment to denigrate them and their spirit. They built #OccupyWallStreet. No, I say it’s time for more of us to follow their leadership and join them, to show that what they represent — the anger, the determination, and the inherent hope — speaks for more of us, even people in suits.
What #OccupyWallStreet has done with considerable success — as the best hashtags and publics do — is open a conversation, one we must have, about the shape of our nation and society and future. If you don’t like their manifesto and demands, fine: What are yours?
At the end of Public Parts, I present mine, knowing they aren’t the right ones but urging people to enter a conversation not about complaints or demands but instead about the principles of our new and open society.
I don’t think #OccupyWallStreet is or should be about just venting anger or demonizing business or complaining or demanding. Indeed, of whom are we making these demands? The failed institutions? The ones our networks will disrupt if not displace? I say the message of #OccupyWallStreet should be more hopeful than that: building a new and open public based on the principles of a society that will replace the dying institutions and their ways.
The Google/Motorola deal is lawyer repellent. Or rat poison, if you prefer. It is a tragic and wasteful by product of our screwed-up patent system. Just this year, $18 billion is being spent not on innovation and invested not in entrepreneurship and growth but instead in fending off lawsuits. Damn straight, we need patent reform.
Having said that, this is good for Google and Android and its ecosystem. That’s why HTC, LG, and Sony all released statements praising the deal. Google isn’t going into competition with them. Google is buying them protection to defend against Apple, Nokia, and other patent holders and legal thugs.
The net result is that Android can now explode even more than it has already. I imagine — I hope — there were other companies in other fields — cars, appliances, TV, devices of all sorts — that were waiting for some security so they could add connectivity to their devices, using Android.
Google wins because, as I’ve been saying, the real war here is over signal generation: Google, Facebook, and to an extent Apple and telcos and others want us to generate signals about ourselves — who we are, where we are, what we want, who we know, what we’re looking for, where we’re going — so they can better target their content, services, and advertising. Mobile is a great signal generator.
But I’ve also been saying that mobile will become a meaningless word as we become connected everywhere, all the time. Who’s to say or care whether we’re connected with a phone as we walk, through our car, on our couch via the TV, in the kitchen via the iFridge, or at the desk (remember that?). Mobile=local=me.
I disagree with those who say that Google had hardware envy vis a vis Apple. Google went into the hardware business and was smart enough to get out. I imagine that Google will operate Motorola as an independent entity; it won’t become Googley. Indeed, I can imagine Google spinning off the product arm, keeping the rat poison.
So this is a good if unfortunate deal to have to be done. That’s my take.
UPDATE: This is now the topic of my South by Southwest proposal. Please go vote for and comment on it here.
We’re not going to have a jobless recovery. We’re going to have a jobless future.
Holding out blind hope for the magical appearance of new jobs and the reappearance of growth in the economy is a fool’s faith. Politicians who think that merely chanting the incantation “jobs, jobs, jobs” will bring them and the economy back are fooling us if not themselves. When at least a tenth of Americans are out of work, for Wall Street to get momentarily giddy at the creation of 117k jobs is cognitive dissonance at its best. No one can make jobs out of thin air. Jobs will not come back. A few new jobs reappearing won’t fix anything.
Our new economy is shrinking because technology leads to efficiency over growth. That is the notion I want to explore now.
Pick an industry: newspapers, say. Untold thousands of jobs have been destroyed and they will not come back. Yes, new jobs will be created by entrepreneurs — that is precisely why I teach entrepreneurial journalism. But in the net, the news industry — make that the news ecosystem — will employ fewer people in companies. There will still be news but it will be far more efficient, thanks to the internet.
Take retail. Borders. Circuit City. Sharper Image. KB Toys. CompUSA. Dead. Every main street and every mall has empty stores that are not going to be filled. Buying things locally for immediate gratification will be a premium service because it is far more efficient — in terms of inventory cost, real estate, staffing — to consolidate and fulfill merchandise at a distance. Wal-Mart isn’t killing retailing. Amazon is. Transparent pricing online will reduce prices and profitability yet more. Retail will be more efficient.
The housing market has imploded and is not likely to reinflate for a long time to come. So the market for new homes will not recover and construction jobs will not come back.
I can and will keep going, but later. Technology and related trends, including globalization, lead to efficiency in companies and sectors. Transparent markets lead to lower prices. Digital abundance leads to both.
All this has profound implications on both business strategy and policy, but we’re not facing these issues as, instead, our leaders keep trying to resuscitate old markets and old ways. Bailing out banks only transferred debt from them to governments (read: citizens), leading to Europe’s mess. Bailing out GM gave life support to an industry that deserves disruption. Fighting over debt in Congress — and reducing the markets’ faith in the markets, leading to this week’s mess — isn’t the issue. The question is, what should government be doing — where it should be investing — to improve our lot in the future as the size of government with the taxes available will inevitably shrink with the economy.
Don’t fill potholes — or rather. don’t think that will fix the economy. Instead, we should be investing in the entrepreneurs who will create jobs — if fewer — and wealth — greater, thanks to platforms and efficiencies. Invest in education of our youth and our unemployed. Invest in efficiency — energy efficiency, for example.
As I say, these are ideas I want to explore now and I hope you’ll help me by sharing yours.
: MORE DISCUSSION: There is an amazing discussion going on not only in the comments here but also at Google+ here.
Paul Graham of Y Combinator led off another amazing debate at HackerNews here.
Thanks to all this amazing discussion, I just substituted my South by Southwest talk from publicness to this topic. Thank you all for the inspiration and for pushing the ideas here.
This is the next topic I want to work on, as I said. So this discussion is invaluable to me as I explore these notions. Again, thank you.
: Here is the text I resubmitted to SXSW under the title, “Honey, we shrunk the economy.”
: See also Rob Paterson’s post on the end of the job and corporation as we knew them. And another thoughtful post from Ben Casnocha.
: Jason Calacanis riffs on the idea of creating a retraining program that would give people the opportunity to move to new jobs.
: Eric Reasons, who really kept me going on this topic when I first raised it on my blog a few years ago, answers the questions in my SXSW talk proposal.
The answer to this question is probably yes. But I don’t think it should be answered until we reconsider the delivery industry from the ground up, seeing what is no longer needed and what the market can provide in the digital age.
My involvement with this project came through a side door. John Callan, who organized it, is a respected consultant and veteran in the industry. He read What Would Google Do? and, I’m glad to say, thought it had lessons for his industry. He came to the book because, at another conference, he heard the head of the UK’s Royal Mail ask the question, “What would Google do if it ran the Post Office?” Ruth Goldway, head of the US Postal Regulatory Commission, answered that she thought Google would give everyone a computer and printer (eliminating the cost of delivering now-obsolete correspondence). Callan thought Goldway had read my book. She hadn’t. But he did. So he contacted me; I was intrigued with the speculation, and we’ve been collaborating since.
Since then, I’ve worked with Callan and company on a project for the USPS Office of the Inspector General. And now I’m honored to be part of the event Callan has called in Washington to ask the big strategic questions about the fate of the Postal Service and the industry.
Who should attend? Obviously people in the delivery industry. So should its customers: retailers that ship directly to customers, Amazon, banks, lawyers, and media companies—including advertising agencies and their clients. Companies that are disrupting the industry should be there. That includes, for example, Facebook, which believes it is redefining and replacing the idea of mail; Google; email companies; new transactional and billing companies; telecoms whose bandwidth replaces trucks; even online media and digital agencies (who should understand what would happen if media and advertising become too expensive to deliver by mail). Entrepreneurs who find opportunity in the disruption of the industry should be there, of course. This includes companies that are rethinking such activities as paying bills and merchandising. Plus, of course, government officials and regulators will need to be there.
I intend to set the tone by proposing some obvious but difficult trends (like these for media), starting with this rule: If it can be digital, it will be digital. Anything that can be delivered by bits will have to be because that costs essentially nothing. That will continue to kill first-class mail and as it declines, its subsidy to the rest of the system disappears, which will raise both prices for customers and losses for the USPS. That trend is already accelerating. The USPS’ loss reached $2.6 billion in the first quarter alone, up from $1.9 billion the year before and volume of first-class mail fell by more than 7%. The USPS says it will be insolvent by September.
This is urgent.
Just as I tell newspapers they need to imagine turning off their presses so they discover where their real value lies, I am saying that the delivery industry has to imagine building itself over because it can and must. Or entrepreneurs will. There are countless new efficiencies to take advantage of. We can’t afford not to.
Do we still need the Postal Service’s guarantee of universal delivery? Likely yes, but it’s worth asking whether that obligation to get deliveries to remote outposts should be carried out with offices and trucks owned by the government or through subsidies to private industry. Does the Postal Service have a role to play in and identity (could it be a guarantor?) and security (our mail is protected from warrantless spying but our email so far is not). What are the principles and rights to privacy and security that should govern even private and electronic delivery? What impact does all this have on broadband policy?
There is much to discuss. This is a starting point, to identify the issues, needs, and opportunities and start the discussion around them. I’ve found the challenge fascinating, more than I’d ever have guessed.
If you are remotely connected with delivering messages, transactions, and goods; if you are the disrupted or the disruptor; if you see the opportunity to invest in the arena, I hope you’ll come.
In the Guardian, Jonathan Freedland is the latest curmudgeon to recycle Nick Carr’s distraction trope, microwave it, and serve it with gravy. The argument is that Twitter—though possibly a wonderful thing for Egyptian revolutionaries (we can argue that trope another day)—is distracting us Westerners from our important work of deep reading and deep thinking and something simply must be done. We have a crisis of concentration brought on by a crisis of distraction, he tells us. Some people I respect react and call this matter urgent.
Bollocks, as my Guardian friends would say.
I want you to think back with me now—I’m hypnotizing you, which should alleviate the stress of distraction, at least momentarily—to the moment in 1994 or soon thereafter when you discovered the World Wide Web and a new activity: browsing. Didn’t we all, every one of us, waste hours—days, even—aimlessly, purposelessly clicking links from one site to the next, not knowing where we would go and then not knowing where our hours went? Oh my God, we would never get anything done again, we fretted. We are all too distracted. We were hypnotized.
I know from market research I did that back then that it was not long before browsing diminished and died as our primary behavior online. We became directed in our searches. We came to the web looking for something, got it, and moved on. That’s partly because the tools improved: Yahoo gave us a directory; brands took on the role of serving expected content; Google gave us search. But this change in behavior came mainly because we got over the newness of browsing and had other, more important things to do and we learned how to prioritize our time again.
It is ever thus. Think back to the early days of TV and cable: My God, with so much to watch, will we ever get anything done? The exact same argument can be made—indeed, one wishes it were made—about books: With so many of them unread, how can we possibly ever do anything else? But, of course, we do.
Twitter addiction shall pass. Have faith—faith in your fellow man and woman. I was busy doing other things yesterday, important things, and so I pretty much did not tweet. I survived without it. So, I’m depressed to say, did all of you without me. I just wrote in my book that Twitter indeed created a distraction to writing the book, as I was tempted by the siren call of the conversation that never ends. But it also helped with my writing that I always had ready researchers and editors, friends willing to help when I got stuck or needed inspiration.
Twitter is a tool to manage and we learn how to do that, once the new-car smell wears off. That’s exactly what has happened with blogging. And here is the moment the curmudgeons triumphally declare the triumphalists wrong and blogging—which, remember, was also going to destroy us—dead or dying. What killed blogging? Twitter. Ah, the circle of life, the great mandala.
But I can guarantee that the distraction trope will be pulled out of the refrigerator and reheated again and again as the curmudgeons raise alarms about the destructive power of the next shiny thing. I’m loving reading a long-awaited new book by the esteemed Gutenberg scholar Elizabeth Eisenstein. In Divine Art, Infernal Machine, she takes us back to exact same arguments over the printing press among the “triumphalists” and the “catastrophists.” That is perhaps better title for our curmudgeons. She quotes Erasmus arguing that
the benefits of printing were almost eclipsed by complaints about increased output: swarms of new books were glutting the market and once venerated authors were being neglected. “To what corner of the world do they not fly, these swarms of new books?… the very multitude of them is hurting scholarship, because it creates a glut, and even in good things satiety is most harmful.” The minds of men “flighty and curious of anything new” are lured “away from the study of old authors.”
And isn’t really their fear, the old authors, that they are being replaced? Control in culture is shifting.
What are our catastrophists really saying when they argue that Twitter is ruining us and Western (at least) civilization? They are branding us all sheeple. Ah, but you might say: Jarvis, aren’t you and your triumphalists making similarly overbroad statements when you say that these tools unlock new wonders in us? Perhaps. But there is a fundamental difference in our claims.
We triumphalists—I don’t think I am one but, what the hell, I’ll don the uniform—argue that these tools unlock some potential in us, help us do what we want to do and better. The catastrophists are saying that we can be easily led astray to do stupid things and become stupid. One is an argument of enablement. One is an argument of enslavement. Which reveals more respect for humanity? That is the real dividing line. I start with faith in my fellow man and woman. The catastrophists start with little or none.
Ah, but some will say, these tools are neutral. They can be used by bad actors as well. That’s certainly true. but bad actors are usually already bad. The tools don’t make them bad.
Take the Great Distractor of the age: Mark Zuckerberg and Facebook. The real debate over him in The Social Network and among privacy regulators and between catastrophists and triumphalists is about his motives. I write in Public Parts:
If, as the movie paints him, he acts out of his own cynical goals—getting attention, getting laid, getting rich—then manipulating us to reveal ourselves smells of exploitation. But if instead he has a higher aim—to help us share and connect and to make the world more open—then it’s easier to respect him, as Jake [my son] and I do. . . .
There is the inherent optimism that fuels the likes of him: that with the right tools and power in the right hands, the world will keep getting better. “On balance, making the world more open is good,” Zuckerberg says. “Our mission is to make the world more open and connected.” The optimist has to believe in his fellow man, in empowering him more than protecting against him. . . .
He believes he is creating the tools that help people to do what they naturally want to do but couldn’t do before. In his view, he’s not changing human nature. He’s enabling it.
I talked with Ev Williams at Twitter and he says similar things. He’s not trying to distract us to death. (That would be Evil Ev.) He’s trying to help us connect with each other and information, instantly, relevantly. (That is Good Ev.) It’s up to us how we use the tool well—indeed, we the community of users are the ones who helped invent the power of @ and # and $ and RT to refine the gift Ev et al gave us. I heard a similar mission from Dennis Crowley at Foursquare: helping us make serendipitous connections we otherwise wouldn’t.
Sir Tim Berners-Lee, the one who started this whole mess in the beginning (damn you, Sir!) is trying to push all the toolmakers to the next level, to better understand the science of what they are doing and to unlock the data layer of our world. Wonderful possibilities await—if you believe that the person next to you isn’t a distractable dolt but instead someone with unmet potential. There’s the real argument, my friends. And you are my friends, for remember that I’m the one who respects you.
Newsweek issues what is either a genius act of subtle satire or a classic case of curmudgeonliness and resistance to technology and change in this slideshow alleging to list the things the internet has killed. It’s hardly worth a response except, in its slide-show simplicity, it neatly encapsulates the hymnbook of the old church. Among its obits:
* Facts: Insert the tired, old argument that “anyone can disseminate false information…. These days, politicians, pundits, lobbyists, and bloggers make so many false statements that more than two dozen fact-checking operations have been launched by news organizations or universities this year in an effort to stem the torrent of untruth.” Well, that sounds nice in alliteration. But it’s bullshit. I argue that we as a connected society have, instead, come to expect facts in an instant. Back in the day, when we didn’t know something, we might vow to look it up, but since that entailed driving to a library, the odds what we would fulfill that pledge were nil. Today, when you want to know something, don’t you reflexively reach for the Internets and the Google? When someone spouts bullshit, don’t you often ask them to show you the link, and if they don’t, you discredit them? This worldview comes from the old journalists’ belief that they were the priests anointed as caretakers of facts. I’d say we’re doing much better with facts on our own.
* Reference books: Only a few slides later, Newsweek acknowledges that we don’t really need those tomes. “Encyclopedias fall behind less-reliable [ah, they couldn't resist] but more timely competitors, like Wikipedia. And why carry around a dictionary, thesaurus, or atlas when you have Internet access and Google?” Why, indeed?
* Privacy: Oh, crap. I’d argue about this one but it would take time away from writing a book on the topic. I talked to new-Newsweek head Tina Brown about the topic here.
* Letter writing: OK, so what? We now have more means to stay in touch with more people in less time than at any time in history. I’m involved in projects on the future of the Post Office and I say there that the first-class letter will be extinct. And now we have blogs, which are often letters to the world. How wonderful.
* Concentration: I forgot what I was going to say about that.
* The yearbook: That’s just flat-out wrong. My kids have yearbooks. School papers are dying but that’s not because of the internet; it’s because of budget cuts.
* The peep show: That would be more accurate if they said the porno store. Drive around Florida or Vegas or even Manhattan and you’ll find plenty of strip clubs. Just this morning, driving in, I saw a new billboard for Hustler’s. (A true case of mis-targeted advertising, I’ll add.)
They also declared toast video stores, vacations, the 9-to-5 job, Polaroids and other film, the telephone, book, the CD, and….
* Civility: Oh, fuck me.
Now, Newsweek, let me suggest what the internet really kills:
Believe it or not, I was disappointed that Cablevision settled with Fox, albeit grumpily, agreeing to pay retransmission fees for its signals. It’s not surprising: Baseball fans wanted their World Series; the FCC was hankering to intervene (without the power); and one really couldn’t imagine going without Fox forever … not yet. So Cablevision caved. Some say this is a sign that content remains king. I think it’s more a case of Humpty-Dumpty teetering.
Hanging tough against Fox was a first shot in the next media battle: the unraveling of TV, the separation of programs from channels. Old TV channels have become an unnecessary layer of curation. It’s the shows we want, not the networks. Networks are and always have been meaningless brands. They provided services: distribution, promotion, monetization. But as in the rest of media — as with news publishers, book publishers, radio stations, book stores — those functions can now be taken away from the middlemen and done more efficiently elsewhere.
The problem for Cablevision is that the unraveling has to start at home. It can’t unbundle Glee and the World Series from Fox until it unbundles its huge packages of utterly unwanted channels that cable companies force us to pay for though we never watch them. Physician, heal theyself.
Of course, this unbundling will be painful for cable companies. They gather huge revenue selling those bundles to trapped customers who have no choice but to pay for Fuse if they want Food. It won’t be an easy transition. But once choice arrives, we will demand our freedom from bundles.
And this unbundling will be quite painful — no, fatal — for many channels. No longer subsidized by being sold with Food, Fuse may die.
Producers and stars will also have trouble with the transition, though I think they’ll come out on top as kings of content. Today, they have to share revenue with many middlemen but at least they know how to use the system. It gets better for them, though, when they’re on the other side of the transition, building direct relationships with fans and not sharing revenue with so many middlemen. They’ll be more efficient — maybe smaller but also possibly more profitable with more control and less risk. Yes, it’ll be harder to make blockbusters but that’s getting harder anyway as we get more fragmentation (read: choice) in media.
What it will take to start disrupting the old ways is for a big star or show to start distributing directly on the internet. The big star’s name will be sufficient for promotion. Distribution is all but free. There needs to be a structure for monetization: selling ads (Google? AOL?) and/or subscriptions (Amazon?). Note well that in entertainment, as opposed to commodity news, I believe pay walls will work. I’ll pay for Weeds — I already have — but won’t pay for one of 5,000 news stories about the same event I could watch myself.
So when we reach the promised land of entertainment, we get rid of the old, value-extracting middlemen: channels. Will cable companies still be around? Possibly. Probably. Someone will still deliver the internet to our devices. That could still be the cable company if it learns how to start adding value rather than just extracting it with bundles and fees and restrictions on what we can do with our own TVs.
There is a new role for curators who add value by helping us find the entertainment we’d like. Enter Google TV among many hopefuls for that job. There are new opportunities to make money with data and targeting (cue privacy fretting). We the audience are no longer hostage to Burbank programmers’ schedules, so entertainment can change form; it can be something other than 22 or 44 minutes long; it can be collaborative, with someone becoming a host and a platform for our creativity (YouTube?); it can last for as many episodes as it should rather than as many as The Office is making.
As with so much else in entertainment and technology, the FCC could screw this up. They’re about to try by asking for more authority to intervene in the retransmission negotiations like those Cablevision and Fox just went through. The problem with that — as with so much else the FCC and FTC and meddling in — is that they would act to support the incubments and prevent disruption, against our own interests, propping up old pricing structures and old models of entertainment and keeping disruptive newcomers out. No, FCC, no!
Here’s the problem with retransmission: Fox succeeded in making Cablevision pay for the right to transmit its broadcast signals. Except those broadcast signals — transmitted on airwaves we, the people, own and gave to channels — are supposed to be free. But now Cablevision is paying for them and those fees will be passed onto its customers. So we, the viewers, will pay for Fox twice — once as an opportunity cost in revenue lost to taxpayers by not selling TV spectrum and now twice in new fees to Cablevision and other cable companies. Thank you very much, FCC and Congress. Way to go. Whom are you serving again?
Once we get socked with more and more fees thanks to retransmission blackmail by channels, I’ll just bet we’ll start protesting to the FCC and it will have reason at last to pressure cable networks to unbundle. Once that’s done, we also need the right to unbundle broadcast channels; I don’t plan to pay for the CW, whatever the hell that is anyway. And once that happens, retranmission becomes as irrelevant as rabbit ears.
Now the next problem is that channels will give up their exclusive rights to programs over their dead bodies. But it has been happening, starting when ABC streamed Desperate Housewives online and as shows show up on Hulu. But now that, too, is getting ugly as Fox tried to block Cablevision users coming to Hulu (until it found it was screwing non-Cablevision viewers, too). And now ABC, CBS, Fox, and Hulu are blocking Google TV, which is insane, for they’re only blocking viewers who want to find their shows. Thus arise all kinds of new (and, for me, unanticipated) network neutrality issues, blocking content based on how you come to the internet or what search vehicle you use. Insane.
Listen, people, TV should be simple. It will be simple, damnit: We want to watch the shows we want to watch whenever and wherever we want to watch them. We’ll watch ads with them or we’ll pay for them. We won’t give a damn whether we watch them on a channel or on a web site or in an app or via Facebook; via a TV or a computer or a phone or a tablet; streaming from the cloud or from our hard drive; found via search or friends’ recommendations on Facebook or Twitter. Channels that stop us from watching them [Fox, are you listening?] are hastening their own deaths. Stars, producers, and studios will, like water, find their way around you as will we, the viewers. You middlemen are doomed. It’s only a matter of time.
So don’t think that Fox won this war. It only won this round. Fox’s parent, News Corp., is turning into the last of the great control freaks of content, building pay walls around its newspapers; blackmailing cable providers — not exactly a sympathetic bunch — into paying retransmission fees for content that is otherwise broadcast free over our airwaves; and pulling links off Google. News Corp. is turning into the uninternet. So fine. we’ll watch how they do as TV and media unravel around them. Can’t wait.
Guardian editor-in-chief Alan Rusbridger asked for help with his view of the fourth estate’s separation (outside the U.S.) into three sub-estates: legacy media, public media, our media (my wording). My response:
Pardon my metaphors:
I had a bunch of public broadcasters from Sweden at my school last week. They’re quite successful—audience is up; marketshare is up—and so it may be difficult for them to feel the urgency of the winds of change and move with them. I suggested that we are only beginning to feel the storm (/metaphor) and I argued that if we are coming out the other side of what some Danish researchers call (metaphor) the Gutenberg Parenthesis then our concepts of media and our consequent cognition of society will change profoundly over years yet to come.
In her amazing history of Gutenberg’s influence, Elizabeth Einstenstein argues that it took 50 years for books to come into their own and not merely copy the scribes and another 50 years or so for the impact of the press to become clear. The Gutenberg Parenthesis team argues that we are entering a period of confusion as great as the one Gutenberg caused. Granted, we are operating in internet years, not Gutenberg years. Still, we’ve only seen the beginning. And so I asked the Swedes to pull back and consider their role more broadly.
So I urged the Swedes to think of media as the essential tool of publicness and one that is no longer mediated. And so in their role of being publicly supported (but not — I’ll grant to them and to the BBC their fig leaves — tax-supported) then I suggested the best thing they could do is to enable and protect the voice of the public. They could curate, train, promote, and collaborate with new people using new tools in new ways, for example. They could establish platforms that make that possible and networks that help make it sustainable. They could see it as their role to support a lively, healthy ecosystem and all of its members, including not only the new kids but also the struggling legacy media (by that view, I’ve long argued that the BBC should make it its mission to use its powerful megaphone to promote and support the best of journalism and media in the UK, no matter who makes it; that is a public good).
All of which is to say that I think your trilogy-view of media today is correct but temporary. We are still in the phase when the printers are copying the scribes’ fonts and content. New wine, old skins. We are also still in a phase of separating the old-media folks from the new-media folks, the public from the private, and for that matter, the media (the journalists) from the public. I think those distinctions must melt away when we move past the stage of copying the copyists and invent entirely new forms.
We see content as that which we make. Google sees content everywhere. Twitter creates content even Twitter doesn’t understand yet (our useless chatter has real value as a predictor of movies’ success). Blippy creates a transparent marketplace for stuff. Google Goggles with Foursquare and Yelp and Facebook and Google Maps and the devices we carry that are always connected and location-aware and us-aware force us to rethink our definitions of both local and news. The Guardian turns data into news by collaborating with the people formerly known as its audience. We ain’t seen nothin’ yet.
So I don’t think we’re yet at a stage of stasis where we can find three estates out of the fourth estate and count on the tensions among them to support a new dynamic of media.
Overlaying this view, I think we are entering a phase in the economy in which industries — filled with closed, centralized corporations that own their means of production or distribution — are replaced by ecosystems — filled with entities that must collaborate and cooperate and complement each other to find efficiencies and through those efficiencies profitability and sustainability. So the idea that your three sub-estates will compete won’t be sustainable; they will have to specialize and then collaborate and as that occurs there may still be separations of roles — e.g., creator v. curator, platform v. network, local v. national — but they are new separations.
What you are identifying is the start of an atomization of media. But I see those atoms reforming into new molecules. (/metalphor)
