Thursday, January 4, 2007

Reading List: Wikinomics Lays Out the Case for Nomadic Economics Based on Collaborative Publishing

I had the good fortune of speaking at BookExpo in Washington, DC last year on the same program with Don Tapscott, who gave a great presentation summarizing his evolving views of shifting corporate realities and their influence on publishing. Don's insights have been influencing major corporations for decades, leading to his new work called Wikinomics, a book and complementary online resources developed with his partner Anthony Williams with USD 9 million in research to back up their insights. Wikinomics looks into the pervasive effects of collaborative and peer-driven publishing technologies on business.

The opening chapter of Wikinomics gives a compelling and pithy example of a gold mining company that had to come up with answers quickly as to the size and potential of deposits in their mine property. Inspired by the story of Linus Torvalds developing Linux as an open source computer operating system their CEO decided to take a new approach to this problem. With about USD 500,000 in prize money as the carrot and full access to the company's usually highly confidential data over a thousand contributors from around the world doubled the identified potential gold deposits, 80 percent of which produced substantial gold. Open access and collaborative publishing had become, quite literally, a gold mine.

Don and Anthony note in the book that "as a growing number of firms see the benefits of mass collaboration, this new way of organizing will eventually displace the traditional corporate structures as the economy’s primary engine of wealth creation." This is heady stuff, nearly on a par with the socialist visions of the 19th-century economist Karl Marx. Yet unlike Marx's rather bleak assessment of the human condition and the remedies he sought to address the suffering found in the industrial revolution Wikinomics paints a positively glowing vision of a business utopia that is to be gained through collaborative and peer-driven information sharing and development. Mind you it's a business book that has to appeal to busy executives, so you'd expect a "how-to" message of this sort, but I think that Don and Anthony have hit the nail on the head.

The fundamentally open and flat nature of Internet-based communications allows intellectual talent to assemble from virtually any source to solve virtually any human problem - as long as people are open as to how they participate in the rewards for their efforts. In essence, then, the Internet has enabled humans to organize themselves without hierarchical control. This is in marked contrast to the corporate vision spelled out in Peter Drucker's 1946 classic Concept of the Corporation, which laid out the case for the military-like structure of postwar General Motors, with its hierarchical command-and-control divisions, as the paradigm of business efficiency. Business, we were told in effect, is war, with the victor claiming the spoils and enslaving the losers. At the time this made sense, as the ability to wage war had been the central source of power for nations since the beginning of civilizations. Corporations would extend that model and become nation-states of their own in effect.

But in today's economy it is not clear that the ability to wage war provides the most power in organized societies. No major power has clearly "won" a war that resulted in substantial material gain for that nation since World War II. Instead, guerrilla warfare, with loosely developed networks of upstarts committed to an idea or cause, has trumped hierarchical political structures time and again. Now in the business world the "troops" that a company assembles under its corporate umbrella may be right for today's battles and entirely inappropriate for tomorrow's. The advantage of holding "territory" such as intellectual property in such an environment such as this becomes more limited. It becomes more important to get that property to its most valuable context, where its value can be nurtured most effectively.

In its furthest extension, then, the Wikinomics concept is really about returning human society to the pre-historic era of nomadic hunting tribes, which could shift their location and resources as needed to respond to rapidly changing environments without the need to have external hierarchies protecting land through wars. Given the issues of our physical environment that are unfolding before our eyes the timing of the development of Internet-based collaborative and peer-based publishing may turn out to be quite fortuitous. But the world of today's publishing is certainly not ready for the most part to accept the depth of this kind of change in their own structures. We're still in the era of publishers trying to turn wild animals of content that we chase in a hunting culture into the domesticated animals of an agricultural culture, through which we can gather the herds into the barns for milking every quarter.

I think that this is the fundamental reason why digital rights management has not worked terribly well to date. There is this inherent disbelief in the minds of most content companies that they will be able to benefit from letting their content "go wild." They just cannot picture in their minds the "hunt" that will benefit them as their content travels from context to context, fattening itself along the way, as they harvest its worth through value-add transactions along its travels. Instead, DRM controls say in effect that they really don't want the content to leave the barn. Content, in their minds, is dumb and weak and must be protected by instruments of war. The paradigm suggested by the Weed DRM scheme that allows users to benefit monetarily from content distribution at least suggests that content can go out grazing and let us know where it is so that we can track it down. So perhaps Microsoft's licensing of Weed portends interesting future developments.

In the meantime Wikinomics is going to become a classic read, albeit attached to an unfortunate title. Wiki technology per se is a very small part of the collaborative content picture and is going to be superseded by other publishing technologies fairly rapidly. There is a chapter in the print version of the book that is actually a pointer to the Wikinomics Web site, which includes a Wiki where people can add their own stories about collaborative content to the picture. There is also a weblog, of course, and sample book chapters in PDF format for browsing. This is likely to become a standard format for book publishing over the next few years, pioneered by Chris Anderson's Long Tail weblog that served as a proving ground and input collector for his business book of the same title. Chris happened to be on the same program as Don and I at BookExpo, equipped with stacks of pre-release copies of his book. No doubt there were some lessons learned by Don from Chris' efforts - lessons that appear to have been well applied.

I would have liked to have seen Wikinomics available as a downloadable eBook with the ability to mark it up with comments, as can be done with some of today's eBook reader packages, but unfortunately the book industry is still in the agricultural mode with its own business models. Well, when you're in a war economy, you have to take your spoils where you find them, I guess. Good luck with the book, Don, it looks like a hit. Hopefully Content Nation gobbles it up.
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