Into The Mystic

Yesterday I was on the subway, listening to music or something. We came  to a stop and a gentlemen walked by me to exit the car. As he did, a button on his jacket caught my headphone cord, which pulled my phone out of my pocket, flipped it up in the air, spun it around, and then we both watched it fall into the crack between the subway car and the platform.

He looked at me, and me at him. He half-apologized; it was a very weird event seeing the phone spin up and down through this 3 inch crack. A guy next to me shouted "No Way!" The doors closed and the train moved on.

Shouting man asked me what I was going to do. I shrugged, dejected, and said "I suppose I will go to a store and buy a new one and set it up." He went back to looking down at his phone, I could see his hand tense up as he held his device tighter.

So later that morning of course I went into a store and bought a new phone and went back to my office and set it up. It took longer than I wanted, so part of my day was spent restoring things. I lost some pictures, apps, songs that weren't backed up. But I got it back and running eventually.

This could be a story of how amazing our technology and devices are. After all less than one day later I have most of my things and you wouldn't know the difference. All my phone numbers and email addresses magically appeared - even some old voice mail messages. If I didn't write this you wouldn't know it happened.

This could also be a story of how technology doesn't work and we are slaves to digital devices - I lost some pictures that weren't backed up of my mother-in-law's 80th birthday party the other night, as well as some gorgeous shots of mountains in Utah where I was lucky to be last week. Some apps too, maybe. Probably some email and I missed some text messages. I was stressed being disconnected while this happened.

Instead, I don't think it has either of those meanings, and it probably  doesn't have any meaning whatsoever. A few years ago I lost a chunk of archived emailed - a few years worth. Some interesting things in there - a few key digital years of my life in the technology business, gone, forever.  It sucked.  Whatever. We move on. Our technology is wonderful and amazing and connects us in ways we couldn't imagine a few years ago. It can also disconnect us if we don't remember that the crack between the subway car and the platform is only a few inches wide, but pieces of our lives can fall through there. It's both things.

"We were born before the wind,  Also younger than the sun"

Real Names Be Proof

Sometimes I forget to appreciate how amazing Internet services can be. By that I mean how often they can expose the real world to us. Which is interesting because the criticism of our Internet-always-connected-society is that it removes us from the real world, it creates false virtual connections in place of real human ones. 

Not true. These services can bring the real world to us in ways we could never have imagined.

How so? Some examples (some of which USV has invested in).

Search etsy for "magic wands"  

More than 4,000 results, but more importantly, from hundreds and hundreds of real people who, for whatever reason, make magic wands. People like TheHappyStar or deannaharward.

Similarly, here is the list of just some of the open loans to small business on the Funding Circle small business lending platform:

A company in Wales looking for capital to expand chicken housing.  A small construction firm in East Anglia looking to expand.  A small hotel in need of capital to to upgrade their lighting to energy saving LED.

Over at Kitchensurfing Clare Lang will come into your house and cook you brunch.

Over at See.me some artist named Nicolas Silberfaden has a portfolio and community showing his superhero (I guess) art.

These are just 4 quick examples selected at 6am on a cold dark NYC morning when I am sitting alone before anyone here is awake.

There is so much humanity in these services, these are real people doing real things connecting with .  . .  the world. I can't imagine anything more real, and important, than that.

Banking and Unbundling

You might be somebody's landlord, you might even own banks, but you're gonna have to serve somebody - Bob Dylan

If it is the case that the Internet unbundles things, that the "power of connected networks such as the Internet is that they unbundle all that came before them," then looking at areas that might be in the process of unbundled might be interesting. I've previously thought this was mainly and initially happening in media and education.

But maybe it's actually occurring most quickly and aggressively in financial services. The Economist, in a survey of non-bank finance, recently wrote: "this is a time of huge opportunity in finance — as long as you are something other than a bank." Banks and financial instituions often centralize things - capital, capabilities, credit, underwriting, risk assessment - things like that - and clearly the last 20 years have seen the rise of integrated financial institutions, so-called financial supermarkets, that in theory gain from being able to provide every financial service available under one organization. But what if those capabilities were better performed separately, and unbundled from the core institution; would the services be provided better (faster and cheaper)? As the Internet reduces information and even transaction costs (even to zero), not only does the notion of a finance supermarket not make sense, but the economics to those "buying" the services don't either.

So are we seeing this then? I would submit yes. Take just a few examples off the top of my head: Market Invoice, Zopa, Prosper, Funding Circle, Lending Club, Transferwise, Dwolla, Stripe, Pollenware, Venmo, RateSetter, Wonga, Simple, MoneySupermarket, Anthemis Group (some of these are companies USV has invested in). These cover retail banking, consumer lending, business lending, money transfers, receivables financing, payments infrastructure, and more. Each one of those does what a "bank" would do, but in a specific area, utilizing the Internet as broadly as possible for most components of its business, and often at a level of service that is much better than previously offered (and most definitely less expensively). Some of these are peer to peer businesses; and some of these are doing over $1B in volume. 

Each one and many more represent the unbundling of the bank. Yet banks are big and entrenched. If and how they respond will be one of the more interesting things to watch in the upcoming years.

Competition, It's a Bitch

Yesterday it was reported in the Chosun Ilbo, South Korea’s most popular newspaper, that Samsung has raised the price of processors sold to Apple by 20 per cent. It is well known that Apple has been making strides to reduce its reliance upon the South Korean company’s components ever since the flaring up of the acrimonious court cases these pair are now famous for. One component Apple is unable to source from other suppliers is the central processor. Knowing this, it seems like Samsung has decided to turn the proverbial screw. 

The Wall Street Journal reports that “Samsung Electronics recently asked Apple for a significant price rise in the application processor. Apple first disapproved it, but finding no replacement supplier, it accepted the increase.” Hexus.net

In our startupy world, we often think of competition coming from the ability of new companies to innovate by being nimble, fast, using lean principles to iterate quickly and forcefully. 

We talk about how difficult it is to be an incumbent, beholden by legacy business models and structures, unable to withstand the momentum of the mighty startup that has nothing to lose, and everything to gain.

But sometimes the most aggressive, even innovative, forms of competition come from the incumbents themselves. Which demonstrates that in an era of connectedness, when information flows so fluidly (and maybe freely), competition can and will come from many places, that it's even harder to compete than ever, and that one's differentiated advantages may only be advantages for a much shorter time than traditional business study has taught us.

Samsung, among other things, has been a component supplier for Apple for years. Some peg this relationship at over $1 Billion. For that time period they have watched a new market (so called smart-phones) develop, and participated in that market from the supply side. But now a few years in, it looks like the supply side is not enough for them. Samsung is famously producing its own smart phone devices that look like they may be able to compete with Apple, it's component customer. Not only compete, maybe even outperform: "Samsung's Galaxy S III bested the iPhone 4S in the third quarter of 2012 to become the world's best-selling smartphone" PCMag.com

Think for a moment about this most interesting dynamic - one of Apple's main supply chain partners is now developing devices that may be outselling Apple's core iPhone franchise. At the same time, it is raising the very component prices that it supplies to Apple. It is pushing hard from both the bottom and the top. Competing in both places.

Apple's suppliers are now becoming its competitors as those downstream suppliers have moved upstream.

Competition comes in many forms and flavors, but it is no less aggressive and interesting when it comes from large companies battling each other.

The Great Fragmentation

A few weeks ago my partner Albert Wenger wrote about Facebook being unbundled: "Facebook's Real Mobile Problem: Unbundling" where he opined that "mobile devices are doing to web services what web services did to print media: they unbundle." 

Then I recalled this blog post from University Ventures which wonders whether "colleges and universities are the next object of the Great Unbundling." This is what Dale Stephens of Uncollege has been saying to me for a while - that education is being unbundled into its component parts: content, teachers, credentials,community, physical campus, mentors, hiring and network.

Then I remembered this wonderful essay Jason Epstein wrote in the New York Review of Books ("How Books Will Survive Amazon") which suggests that the broad general based publishing industry is at odds with the Internet network: 

"Specificity, reflecting the structure of the web, will matter: a guide to the cultivation of daffodils will more likely succeed than a more diffuse gardening title."

In other words, publishers and bookstores will be unbundled.

What if the power of connected networks such as the Internet is that they unbundle all that came before them? They disintermediate incumbent industries but also do the same to any new attempts at re-aggregation?

AOL back in the day, among many others, did not perceive this and instead built its service around the idea that the wide vastness of the web needed to be tamed, consolidated, presented in a singular user experience. That vision turned out to be wrong. Google's turned out to be right - how fast can we get you away from our service into the messiness of the Internet. 

What if then this unbundling and resultant fragmentation is some kind of digital/physical force, law or property? If it is a feature, not a bug.

What would the implications be?  Well some are:

*this process of unbundling and the fragmentation that results from it will continue, if not accelerate

*this is great for users of services - someone will build, and users can find, the specific application or service that serves their desires precisely

*this may be great for some entrepreneurs that embrace this state of fragmentation and can set their expectations to be consistent with it

*maybe not so great for other entrepreneurs and even venture investors - the winner take all era of web services may no longer make sense and thus may be ending.

Let the fragmentation begin.

What If We Give It Away: Lessons from TED

"Once in a while you get shown the light in the strangest of places if you look at it right"

What if the value your service or company provides may not be the one you originally or naturally think it does? TED used to be a simple conference - you pay (a lot) to attend, and in exchange you get to see, in person, some great speakers and meet some interesting people. Great content and even better networking. 


But then TED started giving away the content (TED talks) - basically for free and in almost real time. It also started giving away its brand - allowing the use of the "TED" moniker for other events, conferences, in related and unrelated fields (TEDx). And then giving away its methodology - its format and processes. So what was the result? The TED brand recognition is greater than ever, its content is viewed on the web by millions of people who have never even been to an event, the TED speaker slot is coveted and is even a form of credibility or accreditation, many many more people have been to "TEDx" related events than ever before, and the flagship in person conference sells out as fast as it ever did at the same high prices.

In other words, by giving away what one would generally think of as a company's (a media entity) greatest assets - its content,  brand and business processes - the business has grown enormously in just a few short years. "We found that, giving stuff away, we received even more in return" says Bruno Guissani, European director of TED.

Flipping and basically giving away what one would normally think of as core competencies, core assets, can grow a business dramatically and quickly. With the content, processes and brand more freely available, the community and the set of values can instead drive the business. And those are not as easily replicable. In the case of TED, there used to be just one price point and opportunity for users to interact.  Now there are many (attend the event, watch the videos, go to a local TED, do a TEDx). It is now a 365 day brand, whereas it used to only be a 3 day event.

Imagine how powerful this could be in other areas - for example, what if I could throw a BonnarooX concert in some back yard, using the methods form the festival, inspired by the music clips freely available to me to watch.  

And now maybe we are beginning to see this in other areas too - such as education (see EdX out of Harvard and MIT as one example). I wonder what other areas this can and will be applied to - imagine not only media but also life sciences. 

Giving away what you hold most dearly may turn out to be the best business strategy there is.

Form and Function

And so, the ol’ cassettes have no value to me anymore. Do I toss ’em and let them become more landfill? That’s seems kind of wasteful and un-green. Try to find a home for them with someone who still collects and plays cassettes? I don’t want to box ’em up and send them somewhere; too hard. It’s a quandary. I’ve taken some off the shelves and put them in bags and boxes, and others are still up on the wall. Sometimes I’ll look over and see the date on the spine and think, “Oh, I love the ‘Scarlet-Fire’ from that show!” I’m getting wistful in my old age.But I know I’m never gonna listen to that tape again. Its time has passed. Its gotta go. - Blair Jackson

What happens when the physical form of our media becomes fully disassociated from its function? What happens when there is no longer any physical form at all - it feels like we are basically at that point. Does anyone even remember CDs?


It's wistful to remember cassettes as the form that allowed us to imagine and experience. For me it was record liner notes, the inscrutable clues left behind that exposed a world you couldn't be part of. But that was the key - these were worlds (and objects) that were apart from us, we dreamed of being part of them, but couldn't. They were hard to make.


Instead, right now, we can be part of these experiences - and not just as simple viewers. We can be creators, sharers, promoters, discoverers. I think that's why disassociating the physical form from the function matters. It allows for creation and experience that is wide open, accessible, and easy, as opposed to closed and hard and not understandable. And just as obsessive compulsive too. I still keep my cassettes in the closet too and likely will forever. They are good reminders of how much better things are now.

Looking at Publishing

Just read a wonderful essay in the New York Review of Books from Jason Epstein - "How Books Will Survive Publishing."

Mr. Epstein looks at the current conflict between Amazon and books publishers and Apple, over the prices of e-books, and uses that to step outside and look at the real conflict going on. Which, it turns out, is one of a new medium (digital books and booksellers) vs incumbents who are stuck with the latent economics of a different industry.

Epstein writes:

What matters is Amazon’s attempt to force publishers to conform to the digital imperative by resisting prices that include traditional publishing costs. This is more than a conflict between Amazon and publishers. It is a vivid expression of how the logic of a radical new and more efficient technology impels institutional change.    

In other words, with new technology comes new economics (of both production and consumption), thus transforming (maybe even destroying) institutions that cannot begin or re-form under the new landscape.

Of course, I think this applies to all media, not just publishing (Media: What's Past is Prologue).

So what does Epstein see as one solution:

Independent editorial start-ups posting their books on appropriate web sites have already begun to emerge and more will follow. The cost of entry will be slight. The essential capital will be editorial talent and energy, as it had been in the glory days before conglomeration when editors were themselves de facto publishers, publicists, and marketers. Many start-ups will fail. Some will not. Specificity, reflecting the structure of the web, will matter: a guide to the cultivation of daffodils will more likely succeed than a more diffuse gardening title.  

"Specificity, reflecting the structure of the web, will matter." Or: taste matters. Web structures matter.  Being Internet native matters. In the case of digital web technology, it also requires the transformation of entire industries. And the creation of new ones.

Media: What's Past is Prologue

Information does not want to be free; instead it wants to be distributed friction free. What that means is that information - content -  wants to be in as many places as possible, with many options for access, and with an ease of use to access.

Today, we have an abundance of great content flowing through many channels. Hulu, Twitter, HBO, Youtube, AMC, ebooks, Wattpad, Soundcloud, MediaReDEFined, iTunes, Amazon, Tumblr, Spotify, 9gag. Compared to a few years ago, this change has been remarkable.

As a result we are moving to a world where almost everything is available, basically on demand. The problem for users in this environment is no longer "what CAN I watch" (or read or listen to). Instead, the problem for users is now "what SHOULD I watch " (or read or listen to). The problem has moved from *can* to *should*.  

At the same time, over the past few years we have seen the transformation of how media is produced and distributed. Many of the traditional roles, or competencies, normally assigned to media companies - financing, production, distribution, promotion, marketing - have been disaggregated. In a world where people are sharing - liking, reblogging, embedding, etc - the distribution and marketing function, while important, may no longer be a central competency for a media producer. (And as Kickstarter has shown, financing may not be either).

In this environment, the role for the "media company" is vastly different than the last few decades. Which is not to suggest that in the networked media economy the role of a "MediaCo" is any less important. To the contrary, I think it is even more important and maybe even more valuable to the ecosystem than ever before. But to do so maybe they need to look to the past for the most relevant business models. In other words, look backwards, not forwards.

If we strip out distribution, promotion and marketing as core competencies, the role of the media company might be, quite simply: curated products chosen by a small group of people who just have better taste than everyone else.

In other words, users need to rely on someone or something for taste. Which is hugely valuable. And branded tastemakers make perfect sense. Because taste matters. This is also how it used to work in the past. For example: MGM films - Metro-Goldwyn-Mayer, at one point had a brand associated with sophisticated films in technicolor. Later, it focused on musicals. Elektra Records - led by Jac Holzman - was an artists-oriented rock label, associated with the Doors, Love, The Stooges. Miramax films - I still check out what Miramax releases due to the strength of The Crying Game and Reservoir Dogs, back from 1992. HBO original series - From The Sopranos to The Wire. Sub Pop records - indie rock (I still check their new releases every Tuesday). Da Capo Press - historically, maybe the best music book publishers. And so on.

What these few examples have in common is that the core value provided by MGM, Sub Pop, etc. - is their taste. Not their ability to manufacture, or promote, or distribute - but instead their ability to pick great content. Not everytime, for sure, but often enough that they in turn became brands associated with a certain taste. Ones that could change over time, but ones that were rooted in an ability to make choices that are hard for average users to make. Ones that meant something to people.

So maybe then the future of media is actually to be found in its past. Media companies need to stand for a point of view, a genre, a way of thinking about content, a set of content related principles. They need to themselves become brands, again.

Hackathons and Open Source Invade the Real World

In the past few days I've seen a few things happen that demonstrate that what were once tech concepts or principles have seeped into non-Internet world, and are being applied in places maybe they were not originally intended, but to great effect.

First, I serendipitously met a woman who runs major marketing programs at Facebook who walked me through an amazing internal presentation they have about applying the principles behind hackathons (try a lot of ideas, solve a problem, iterate fast, be creative, be social, ship, etc.) to solve non-product problems. She showed me pictures of an office area - some group at Facebook was doubling in size and instead of lobbying internally for more space they basically had an internal hackathon and hacked a solution to their existing space - coming up with an idea and then turning a small square space into a bi-level loft area, thus doubling the size of their area and making it much more awesome.

Then I saw this from the record label Ghostly International - they are starting to open up their processes for choosing artwork for their records - writing essays and taking comments about how and why they do it, while they do it. Basically open sourcing and making transparent what was once a closed and opaque process.

Neither of these examples are world-changing, but that's not the point. They are small and simple and illustrations of ideas founded on openness, experimentation, networks - that were originally intended for and applied to the writing of software. But have now seeped into the world at large. And that's the big deal.

Inventors and Entrepreneurs

My grandfather Nick lived what looks in hindsight like a cliched life. Born in "Turkey" in the 19th century, as he told us (we only later learned he grew up in Jerusalem, which was then part of the Ottoman Empire, ie, Turkey), steamship through various ports ending up in  Ellis Island in the early 20th century, immediately shuffled off to a tenement house on St Marks and 2nd Avenue, later escaping to Flatbush, Brooklyn, then engineering degree at Stevens Institute of Technology (graduation picture below).

When we were growing up, we asked him what his job was. He said he was an "inventor" - he invented things and then he patented them because there was no other way for a lone individual to protect his physical inventions. Most of them were useless, but they were his attempts at solving problems, albeit small ones - there was a Phonographic Toy Telephone, and the Multilipstick Holder (!). His idol was Thomas Edison.

In the 1950s on his walks through NYC he noticed something. He used to walk past the back entrance of a supermarket regularly. Because of NYC fire regulations, the exit door leading to the store room could not be locked - from the inside or the outside - it had to allow for free and easy access in and out in case of a fire. But because of that, he often saw people looting from the store - they simply opened the door, walked in, took something and walked out. So he thought up the idea of a door lock that would satisfy the fire code and provide security. He invented the emergency door with the push strike plate - a door that was locked but could easily be opened by someone pushing a plate which would unlock it. Later, an emergency sound was added to the push plate. It became something like this:

Every time I see one of those I think of him. And the patent is here.

It was only about a year ago however that I realized what my grandfather really was - an entrepreneur. Right now, it might be a name used so often that it loses much of its meaning. But in the 1940s and 50s, he didn't have that name, and he didn't have access to people, blogs, incubators, accelerators, venture investors, founder meetups, lean start ups, minimum viable methodology or Skillshare classes to allow him to do more. A Google search for "entrepreneur" has 135,000,000 results. A search for "inventor" has only 15,100,00. So he did what he could: he later sold the patent to a firm which could manufacture and distribute the locks, which enabled him to move out of Brooklyn and live comfortably with Grandma in a one bedroom rent stabilized apartment on East 16th Street.

We don't often think of inventions anymore, and certainly less of inventors. But they are all around us - we've just given them another name and the tools to take the ideas and create more and realize more from those ideas. My grandfather would have loved to see that change.

Generations

One of the most interesting trends in technology and business and politics today is what I like to think of as the generational one. Meaning, what happens when the group of kids who grew up with Facebook, Twitter, Tumblr, Youtube, iPads, Soundcloud, smart phones, streaming video and music, 1TB hard drives, cloud services, and the like, are in charge and are running Disney, the RIAA, or Time Warner. When they are elected representatives to the House or Senate. When they are principals of schools or presidents of universities. When they are executives at major banks or credit card companies.  When they are doctors or running healthcare companies. When they continue to launch startup after startup.

How will the world be imagined by a group of people defined by being always connected?

I think this generational shift cannot be any more profound than we can imagine in the wildest of scenarios.

The Network

Today is an exciting and loving day, as my wife Susan releases her first book - Feeding Eden - essentially a memoir about our family, how we have dealt with some serious food allergies my son has, and how as a result our relationship to food is now pretty different from most people.  No Foodie Nation for us. She calls it our New Normal.

More than that, to me this whole process is the story of a networked community. Almost 8 years ago when we found out that Eden was allergic to 7 of the 8 FDA determined most common ingredients to trigger an allergic reaction, there were few places to go to figure out what it all meant. Susan, who took on the bulk of managing this, instead had to create a community out of fragmented people, places, sites, medical studies and ideas. She turned to medical research journals, practitioners of various medical specialties, alternative and therapeutic healers, advocacy organizations and, most importantly, people all over the world. She connected with them, at least initially (and I would say most effectively), through the Internet. The tools were email, Twitter, a blog, Facebook, then a platform on Huffington Post, Psychology Today, and others she tried that didn't work as well.

The tools often led to a rabbit hole of hours lost in front of screens. But ultimately some worked, and she figured out how to make them work for us. A community of people experiencing similar "New Normals" but from an amazingly diverse set of experiences were connected. Ad hoc of course, but connected deeply nonetheless. If this had happened to us 10 years earlier, we would not have had the tools to construct and find and become part of this growing network. This community - and the organizations they support - not only publishes constantly online, they have also help to enact supporting laws relating to food labeling, restaurant regulations, emergency medications and the like.

So what was once an narrative of our son's medical conditions, later became an essay, and then a book.  But more than that, its backdrop is how *the* network can become *your* network if you want and need it to be.

If you like you can find the book here or here.

Cracks in the Sidewalk

"You know a lot of people consider skateboarding a dumb thing to do. But to me skateboarding made me reassess everything I did. If it was raining, I was bummed, because I couldn't skate. If I was looking at a street, I'd think that'd be a great ride, I'd be checking the sidewalks to see how many cracks it had. If I saw a curb, or a drainage ditch, I'd stop the car to go back and see if it was something skateable. All I was looking for was lines, all the time." Ian MacKaye, Fugazi

Six weeks ago I broke the third metatarsal bone in my left foot (tripping on a crack in the sidewalk), leaving me in a cast for that whole time. I just took the cast off on Friday, and only today feel semi-confident walking around. As a result,  my whole perspective on the city I live in changed.  Getting around was at best a hassle and at worst almost impossible.  Every interaction required forethought and planning - too much. Walking down the street required me to be much more alert - looking for the cracks, studying the slopes of the curbs, routing around drainage ditches, pulling aside to let people pass me. I studied the weather reports obsessively, down to the hour, trying to divine when rain would result in a wet cast or the inability to get a taxi.  I clustered meetings around each other to avoid having to travel, and had to bake in a ton of extra time to get around.  I couldn't carry my backpack because of the extra weight so I loaded my jacket pockets with whatever I needed, pared down to the essentials (Naproxen and an extra Ace bandage).  Most importantly, I left my headphones behind and for the first time in a long time travelled around without music blasting.

In all, as I struggled to get around, I was barely focused on the destination where I was going.  Instead, all the mattered was the path, the way I got there. I got intensely, obsessively and annoyingly focused on the minutiae of daily planning. When I got someplace I had the sense of satisfaction with just making it there, on time, without more injury.  The journey became way more important than the end result.  

The 1960s activist/improv group the Diggers used to have this thing called the Free Frame of Reference - a giant picture frame people would have to walk through to get to the servings of free food in Golden Gate Park that the group offered.  The idea was that through this exercise people "were literally changing the frame of their reference, they were themselves actors in the show and by changing their minds could thereby change the world."

Today I finally got to put my headphones back on (loud) and turned off the rest of the city as I hobbled into work, and it was great. I've always believed that it doesn't matter where you start in the world, what matters is where you end up.  It's just that I'm thinking now that the cracks in the sidewalk are the more vital frames of reference that guide that journey.

Information Does Not Want To Be Free

Stewart Brand is infamously reported as saying "information wants to be free"- the rallying cry against any limits on information ownership, the mantra for free content and ideas.

Which obviously leads to scorn and mockery: "You'll often hear cypherpunk weenies with poorly-thought-out philosophies trot out 'information wants to be free' as some kind of pseudo-socialist Utopian vision."

Except Brand never said that information wanted to be free, and I don't even think he meant that.  What he said was much more profound, and as timely now as ever.  He said either:

On the one hand information wants to be expensive, because it's so valuable. The right information in the right place just changes your life. On the other hand, information wants to be free, because the cost of getting it out is getting lower and lower all the time. So you have these two fighting against each other.

Or this:

Information Wants To Be Free. Information also wants to be expensive. ...That tension will not go away.

Either way, I believe that what he was talking about was NOT the value of information.  He wasn't purporting to opine, for example, about the inherent value to a user of content, or the equilibrium pricing relationship between demand for information (which is limited) and its supply (basically unlimited).

He was referring to the power of networks - the wealth of networks.  Human networks amplified by the Internet.  What networks do is that they take the traditional "distribution" roles associated with information - production, marketing, promotion  - and push those to the edges, the nodes, as opposed to a centralized source.  And they do so in more transparent, non-hierarchical manner.

In centralized systems, production, marketing, promotion and distribution are viewed as costs, expenses, and something to be tightly controlled and managed.  That's what traditional media companies do.  In the networked world they are opportunities, but they are pretty much uncontrollable.  In that way they are authentic.  And this is precisely the tension about which Brand spoke, for this represents maybe the final breakdown of the traditional media content producer/distributor/consumer buckets.

Those separate pieces  now become one, they blend into one another.  They aren't centralized core competencies anymore.  This is represented by the idea that there are no more consumers now, there are only “users”. As a result, this transformation alters fundamentally the whole media value chain. This is potentially disruptive to many companies.

But it does not mean that users will not pay for information or content.  To the contrary. For example, Hollywood’s best box office years ever were 2009 and 2010.  Similarly, publishing industry revenues expanded in 2010 almost 6% over 2008 (with ebook sales growth of over 1000%).   Hulu has over 1.5 million paying subscribers.

Therefore, it's not helpful if the discussion centers around whether information wants to be free or not.  For that is not the right equation.

Information (content) does not want to be free.  Instead, information just wants to be distributed friction-free.  That's a big difference, and also the massive opportunity that should be at the center right now.

This work is licensed under a Creative Commons Attribution 3.0 Unported License