The C-word: A Saturday night meander

A whole generation of people grew up in the belief that using the C-word in public was just not done. So they avoided doing so. A good thing.

At the same time, unrelated to the original C-word, they’ve managed to obscure and obfuscate a number of other C-words. Not a good thing.

This post is about those other C-words.

Let’s start with “convergence”. Ever since I first saw the 1972 Steven King video, Computer Networks: The Heralds of Resource Sharing, and absorbed it in the context of an earlier, 1968, Doug Engelbart video, often referred to as The Mother of All Demos, I’ve believed in the convergence of computing and telecommunications. Yet, forty years after those events, and at least 20 years since I was being told convergence is happening, we still live in a world where behaviour suggests otherwise. People still try to analyse and regulate this converged world as if computing and communications were distinct and separate. At least that’s the impression I get when I see misguided, often impractical, attempts to regulate aspects of the internet and the web. When are we going to see convergence take place more holistically?

Then let’s move on to “collaboration”. Ever since I left university and started work, the idea that teamwork and collaboration are important have been drilled into me, even drummed into me. Yet, thirty years later, it is still rare for me to see objectives, processes, systems and incentive schemes that reflect this. Yes I’ve seen team objectives and scorecards, but team behaviours remain singularly singular and attempts at team bonuses and reward structures are usually greeted with sniggers and derision. Ricardo Semler wrote Maverick in 1993, chronicling events that took place in 1981, nearly 30 years ago. Yet collaboration, openness and transparency are largely buzzwords in most enterprises, and a culture of secrecy, behind-the-scenes lobbying, whispering campaigns and “briefings” tend to be the norm. Much of what we’ve seen in the wake of Wikileaks suggests that cultural acceptance of collaboration and sharing is low amongst the powers-that-be. So how long before collaboration stops being a concept and moves towards becoming reality.

Which brings me on to “community”. Something that goes back a tad more than the thirty or forty years I refer to in earlier points. Somewhere along the line, many of the concepts of community: shared ownership, collective empowerment, joint accountability, these have somehow become attached to concepts like communism or at least anti-capitalism, and as a result there are regular outbreaks of pseudo-McCarthy-like behaviour, as if belonging to a community should have you investigated by the House Un-American Activities Committee. You only have to look at the tirades that were launched against opensource; you only have to witness the behaviours exhibited against sharing-related tools like Napster or BitTorrent; you only have to gape at the porcine beings wearing the lipstick of “intellectual property rights”. At which point did individual rights become so much more important than community rights? What will it take to reverse that process?

Let me move on before I get too much on that particular high horse. Next word. “Consumerisation“. Something that’s been around for at least a decade. But not if we are to look at how our corporations behave. With the advent of the millenial generation, consumerisation is no longer theory. It has happened. Yet we still try and convince ourselves that consumers are different from businesses, that staff are different from partners, that partners are different from customers. These distinctions are just not tenable any more, it’s like saying “IT” and “business” are distinct and separate, that “living” and “breathing” can be treated as isolated things. When will we realise that people are people, that putting labels on people doesn’t change that fact?

I could go on and on, but won’t. The point is, things are changing all the time, and the pace of change is itself accelerating. The edges of many things we held as distinct and separate are blurring: the borders between countries, the lines between market segments, the boundaries of firms, the separation of consumption and production in a world of service, the distinctions between staff member, partner and customer. The devices we use are blurring. The professions we follow are blurring. The definitive differences between political parties are also blurring.

Everything is blurring, and at a rate of knots. This is not a new thing: over fifteen years ago, Kenichi Ohmae referred to aspects of this in The Borderless World, five years later Chris Meyer and Stan Davis kept with the theme in Blur, and more recently, John Hagel, John Seely Brown and Lang Davison took it yet further in The Power of Pull.

People don’t know what a country is any more. People don’t know what a political party stands for any more. People don’t know where a company starts and where it ends.

There is some confusion out there. Because the rules for so many things are changing.

But some things are not changing, some things are resolutely refusing to change. The way we account for things. The way we try and manage things. The way we report on things. Stuff like that.

Predictable, in a way. Because we cannot solve the problems of new paradigms using the tools of the old. And we haven’t yet built the tools of the new. Because so many of the things that are changing attack the very basis of power of so many people in incumbency.

So they try to hold on. Not by paving over the cowpaths, which would be inefficient and wasteful, but by trying to make cows out of cars.

A very confused state. One full of opportunity, and of pitfalls, as a result.

Which is why we get valuations like we get for Facebook. The truth is, no one knows what the real valuation of Facebook, or of any post-Web firm for that matter, should really be.

At times like these, there’s a tendency to go back to first principles. Where the behaviour of markets are based on momentum, confidence, fear and greed.

Exciting times.

The new new telco

There has been a lot of debate as a result of recent announcements about Goldman Sachs investing $450m in Facebook at a valuation of $50bn, and planning to raise another $1.5bn at the same valuation, apparently by attracting wealthy private investors into a special purpose vehicle at high speed.

Much of the debate is about the valuation, with talk of Bubble 2.0 (and even 3.0, I lose count nowadays).
The valuation doesn’t surprise me, however dark the art of valuation may have become. Why? Because Facebook is the new new telco.

What do I mean? Let’s start with the original telco, which comprised of the following components:

  • A population of subscribers, aggregated into a directory, with relevant personal contact information (addresses, telephone numbers)
  • Reduced search costs within those directories as a result of classifications and groupings: alphabetical (A-D, E-H and so on) geographical (London, Birmingham and so on) and functional (white, yellow and so on)
  • Multiple modalities of communication between the subscribers (post, telegraph, telephone)
  • A record of changes, published regularly as errata and addenda

Original telcos provided services via fixed devices and spent vast amounts of money on infrastructure. They sought to justify monopoly positions by pointing to the infrastructural expenditure required.

For over a hundred years, all we had was original telcos.

Then, just over two decades ago, came the new telco. The best-known member of this class is Microsoft.  And the new telco extended the componentry:

  • Personal contact information now included e-mail and IM addresses
  • Directories became online, searchable and downloadable (personal and public address books)
  • Modalities of communication now included email and IM
  • Changes were now applied continuously to the directories, but were not published.
  • And some new components were added: it became possible for subscribers to schedule meetings between each other, and to use general-purpose devices like computers and smartphones to do all this.

New telcos provided services via fixed and mobile devices, delivered principally to corporates, and everyone spent vast amounts of money on infrastructure, much of it on-premise. Personal customers were nibbled at via email and IM, but the thrust of the new telco was at the corporate.

For a few decades now, all we had was original telcos and new telcos.

Then, six years ago, Facebook arrived, the leader in a new class of telco, the new new telco. Again, the componentry was extended:

  • Personal contact information became enriched to form profiles, user-editable
  • Classifications and groupings of people within directories were enriched as well, user-creatable networks and groups emerged
  • Modalities of communication now included, or will soon include synchronous and asynchronous audio and video
  • Scheduling of meetings now became more pub-sub in structure, via the use of open and closed events
  • Changes weren’t just applied continuously, they were published continuously. This record of changes was called a News Feed.
  • All this was done on a user-creatable, user-editable, personalised-access-and-view basis
  • And the whole shebang was then carefully bundled and exposed as a platform upon which other people could build services, viral, social, mobile

New new telcos provided multimedia services across multiple types of device using multiple modalities of communication. And they did everything “over the top”. No infrastructure costs. No on-premise software.

And to top it all new new telcos had new new assets, information about relationships and flows. What Facebook call the Friend Graph.

So let me see. Facebook has more customers than most original telcos put together, more customers than most new telcos put together. It offers more modalities of communication with lower transaction costs, higher end-user empowerment, personalisation and customisation. It does not have to invest in communications infrastructure, in customer premises equipment, in devices, in on-premise software.

600 million active users. A “subscriber base” larger than any country bar China or India. Revenues growing from $777m to $1.2bn between 2009 and 2010, with net income up from $200m to $355m.

The new new telco. Now think of the valuations of old telcos and new telcos, then look at the difference in costs, in scalability and globalness, in revenue and profit opportunity.

Let’s put this into context.

I have a lot of time for a Boston professor I’ve known since the nineties, N. Venkatraman, Venkat to his friends. Around a decade ago, across a number of conversations, Venkat convinced me of a critical change that was taking place in business as a whole:

He said that businesses used to be hierarchies of business units whose assets were called customers and products; that they are changing into networks of business units whose assets were called relationships and capabilities.

New new assets. Relationships and capabilities. Social capital. Human capital. Assets we have carefully avoided learning how to value. Assets we have refused to value, however much we speak of the importance of talent and knowledge and collaboration.

That’s where the new new value is.

New new telcos are not just for consumers, there is immense value to be created by and for businesses as well, from the sole trader through to the megalith. And with the continuing growth of consumerisation, the distinction is blurring more and more anyway, there’s a singularity approaching in this context.

Facebook is concentrating on the pure consumer play, and that’s fine. They can afford to experiment with their market and learn from their experiments: the profile, the news feed, Beacon, the privacy settings, there’s been a powerful suck-it-and-see mentality, coupled with an excellent responsiveness and adaptiveness to feedback.

Businesses are social as well. Markets are Conversations. As Doc Searls immortalised in The Cluetrain Manifesto (Disclosure: I count all four authors as my friends, and contributed a chapter to the 10th Anniversary Edition of the book).

So companies need better ways of evolving, enhancing and exposing their capabilities and relationships, making it easier for their customers to do business with them.

The Rolodex was the tool of the trade in the times of the original telco.

The on-premise customer information system was the tool of the trade in the times of the new telco.

What I could see was the potential for Chatter to be CRM on steroids, cloud-based, community-driven, multimedia, both synchronous as well as asynchronous, extending beyond the enterprise and supply chain to the customer.

What’s happening is that the stuff we called CRM is blending subtly with the stuff we called knowledge management, accelerated by the publish-subscribe mechanism of collaboration tools like Chatter, enriched further by the multimedia mobile, social, viral aspects of all this and delivered at speeds and price points made possible by cloud technologies.

All just in time for a generation who cannot remember a time before the web, a time before the mobile phone.
All just in time for a generation for whom “rent” means more than “buy”, for whom “share” means more than “own”.

All just in time for a generation who have rediscovered community.

That’s why the Facebook valuation does not surprise me.
That’s why I jumped at the chance when Marc Benioff asked me to join Salesforce.

New new times.

Exciting times.

[Incidentally, some of my posts are now cross-posted into The Cloud Blog, where I write alongside my colleagues at Salesforce. Here’s a link to the first post I wrote there.]

Thinking more about un-nationalness

[Note: this is a follow-up to my post a few days introducing the theme of un-nationalness.]

Krosno Odrzanskie, Poland. Dakar, Senegal. Greenwich, London. Uzice, Serbia. Rio de Janeiro, Brazil. Cardiff, Wales. Praia, Cape Verde. Edinburgh, Scotland. Derry, Northern Ireland. Blaegoevgrad, Bulgaria. Guadalajara, Mexico.

These are the birthplaces of the 11 who took the field in today’s Barclays Premier League soccer match between Manchester United and Stoke City, two venerable English clubs. The starting line-up were born, on average, 1896.56 miles from Manchester. Which is the distance between Manchester and Ankara, Turkey. Which is in Asia.

Not one person born in Manchester made that starting line-up.

The goals were scored by men born, on average, 4106.32 miles away from Manchester, one from Cape Verde and one from Mexico.

Why is all this important? Because until 1982, when Arnold Muhren transferred to United, they’d never really fielded a “foreign” player, from beyond the UK and Ireland. [While some claim Carlo Sartori in 1967 as the first, I am led to believe his family moved to Manchester while he was a young child, and he came through the junior ranks as any other domestic child.]

Talent knows no borders, and Manchester United have done a good job garnering and harnessing global talent. As far as the club was concerned, it did not matter where they were born, or what nation they represented. What mattered was how they played football.

So the Manchester United of today is quite different from the Manchester United of a few decades ago. All made possible because of the relatively free flow of capital, and of labour,  across borders, not just in Europe but beyond: at least four of the players aren’t European; and the owners of the club are American.

For some decades now, it has been getting easier and easier to move money around the world, with the unintended consequence of making terrorism and tax avoidance easier. For some decades now, it has been getting easier and easier to move around as an individual, as the relative cost of travel has dropped and the need for talent has grown unabated. So labour and capital have moved more freely than ever before, creating an environment Ken Ohmae described vividly over two decades ago in his seminal book The Borderless World.

But it’s not just labour and financial capital that move freely nowadays; knowledge or “human” capital, along with relationship or “social” capital, also have this ability now.

Which gives governments a real headache. Because they want to lock in their “customers”, the people and companies that pay the taxes that allow them to exist. The traditional swords and ploughshares of government — regulation and taxation — are fashioned into the flowers of freedom, as companies migrate between regulatory and tax regimes at will.

This erosion of “national” power is happening at all levels: the state, the company, even the individual, as the tools of lock-in get diminished in scale and quality.

In choice there is power; the continuing evolution of the tools of communication and transportation have increased “customer” choice significantly, and out of this choice has come about the growth of un-nationalness.

In some ways it’s what I have been saying for some time now: many of the lock-ins of the past are being eroded: every artificial scarcity is opposed by an equal and opposite artificial abundance; over time the abundance wins.

As a result, new institutions, organisations and ways of working continue to emerge, built on un-national principles. Facebook, Skype and Twitter would all appear on a list of the top ten “countries” of the world; virtual currencies continue to grow apace, despite not being issued, underwritten or guaranteed by countries; money is borrowed and lent at micro levels; political funds are raised on the internet; soon, even law will be drafted on a collaborative basis.

New, un-national fora are taking centre stage, ranging from the World Economic Forum to TED to the Web Science Trust.

New un-national tools like the internet and the Web are entering their golden age, enabling amazing levels of communal activity and collaboration.

Historical lock-in models practised by governments and monopolies and monolithic hierarchical institutions are being dismantled while they sleep; the movement from analog to digital has shattered the erstwhile peace of the news, publishing, music and film businesses; education and healthcare are in range; and government will follow.

For many years now, people like Stewart Brand, Howard Rheingold and Esther Dyson have been writing about these changes. More recently, Clay Shirky, Don Tapscott and Doc Searls have been documenting the changes and explaining the rationale behind the changes.

But these are hard changes. So there is a reluctance amongst the changed to accept the change. Puerile pieces of legislation litter the landscape, as governments and incumbents seek to hold on to what they had.

But it’s over. Over. Because the tools of choice are in individual hands. And there is no master switch. By design.

Which means it’s time for all of us to understand more about the principles behind un-nationalness, underpinning the statelessness of today.

For starters, I think we should be considering these:

  • The Principle of Simultaneity: Un-national things happen at the same time everywhere; an un-national film is released everywhere and in all format in the same instant.
  • The Principle of Unownability:  Un-national things are owned by no one. In Doc Searls’ words, they’re NEA. Nobody owns them. Everyone can use them. Anyone can improve them.
  • The Principle of Emergence: Un-national things standardise through market adoption rather than by diktat or decree or regulation. There are no standards bodies to game, no lobby mechanisms, no palms to grease.
  • The Principle of Federability: Un-national things have to be built on the DNA of federation rather than the toxins of monoculture and monopoly.

When humans have real choice, they choose where they work, where they live, where they pay their taxes, where they raise their kids, where they die.

These choices are increasing, despite the efforts of some governments and some corporates.

Historical structures, built on hierarchical principles, had choke points where control could be established.

Today it’s like trying to control air or space or the oceans. Un-national things.

Of course new toxins emerge, new dangers become apparent. Which is why we need the work of people like TED. Like the WEF. Like the Berkman Center. To delight us with what is possible. To warn us of the risks. To give us a forum for debate. And to ensure we have the freedom and the choice to be part of those debates.

Incidentally, if you want to see what happens at Davos, why not try and get invited there? Take part in the Davos Debates, there’s still time.

A coda. If you have the time, read The Kernel For This Blog, something I wrote nearly six years ago. It’s how I visualised un-nationalness at the time.

Musing about 2011 and an un-national generation

Happy New Year everyone.

If you haven’t heard of William Stafford before, you should try and spend some time reading his poetry. Stafford, who died in 1993, was made the US equivalent of Poet Laureate in 1970, and was known for his gentle, pithy style. A prolific poet, he is estimated to have written over 22,000 poems, though only a fraction are available in print.

One of my favourite Stafford poems is At The Un-National Monument Along The Canadian Border, shown below, a good reason to go out and buy a collection of his poems today:

If you like what you see above, there’s also a decent archives site you can find here.

There are many reasons for my liking the poem. Even now, years after coming across it, I can still savour every line. I must admit I have a particular fondness for the ending, the sheer power and imagery of phrases like “hallowed by neglect” and “celebrate it by forgetting its name”.

There’s also a tangential reason for my liking the poem. Stafford’s use of the word “un-national”, a word that resonated quite powerfully in me.

For many years now, I’ve been pondering what it means to be “global”. [As I’ve written before, I was born a foreigner: my name was alone enough to tell people in Calcutta that I wasn’t from there; my colouring and accent were enough to tell people in Madras that I wasn’t from there. And yet, as the name of this blog suggests, I am extremely fond of Calcutta, and consider that the city, and its people, played a critical role in forming and shaping what I am today.]

When I joined BT some years ago, the issue of “being global” came up in conversation with the then CEO, Ben Vervaayen. At the first meeting I ever had with him, Ben brought up the issue, asking me to consider carefully the distinctions between “international”, “multinational” and “global”. And, especially since it was a topic of some personal interest already, I obliged.

And where I got to that evening sometime in 2006 was this: that perhaps a key distinction between “global” and all those other words like “international” and “multinational” lay in the fact that it didn’t contain the suffix -national, that the essence of being global could not be defined in the context of nations. There was a born-foreignness to it, a statelessness as it were.

Some years before that, I’d had the pleasure of discussing some of this with friends and colleagues at Dresdner Kleinwort, particularly Sean Park and Malcolm Dick. Incidentally, if you haven’t watched it yet, you must see Sean’s 2005 AmazonBay video. Amazing. [Disclosure: I’m a venture partner with Anthemis Group].

Particularly around the time that Sean was creating the video, we spent some time discussing the “death zone”, the vulnerable space in the middle as businesses migrated to the extremes of global and hyperlocal; it was here that the conversation first meandered into the “stateless” topic, as we ruminated on the fact that quite a few of the institutions destined for the death zone seemed to be characterised by having national structures and ambitions.

Against this backdrop, I’ve been spending time thinking about the whole national-versus-stateless thing, particularly since it seemed to come up in so many of the areas I was interested in. Our laws and regulations and business practices are intrinsically so national in structure and intent that they get incredibly messy when applied to things un-national. Here are a few examples:

These are just simple, random examples that come to mind, where there’s a tension between national law and global products and services. National versus un-national, stateless, global.

More recently, some six months ago, Jay Rosen referred to Wikileaks as the world’s first stateless news organisation. Incidentally, while touching on the subject of Wikileaks: you must read Clay Shirky’s “half-formed thoughts” on the subject, covering some of the issues of international versus stateless.

While in India, I read Tim Wu’s The Master Switch, which deals with cyclical development in information and communications industries, sine-curving between closed and open. One of the things that struck me about the book was that each cycle appears to be described in the context of a single country. If you haven’t read it yet, it’s well worth a read. Take a look at Cory Doctorow’s review here.

The internet, the Web, the Cloud, these are essentially disruptive global constructs for many of us. The atoms that serve as infrastructure for these global constructs are physically located in specific countries; the laws and regulations that govern the industries disrupted by these constructs are themselves usually national in structure; the firms doing the disrupting are quasi-stateless in character, trying more and more to be “global”; emerging and future generations have worldviews that are becoming more and more AmazonBay, discarding the national middle for the edges of global and hyperlocal.

We are all so steeped in national structures for every aspect of this: the law, the governance model, the access and delivery technologies, the ways of doing business — that we’re missing the point.

Everything is becoming more stateless, more global. We don’t know how to deal with it. So we’re all trying very hard to put genies back in bottles, pave cowpaths, turn back waves, all with the same result.

Abject failure.

And things are fraying at the edges. For some years now, I’ve been commenting on the internet, intellectual property law and identity, in the belief that these three “i”s are the foundation of the new, global, order. And of course I’ve tended to write about these things in the context of music and film and books and food, because those are the places where I see the cracks in the current foundations, as things move from analog to digital.

But it goes well beyond these. Take fundraising. It’s gone global. I love Causes, what it means, what it stands for, what can happen as a result. To me Causes is essentially global. Yet it has to have national collection processes, tax rebates, bank accounts. For most causes this dichotomy is fine, since so many causes are global. But what happens when you’re trying to raise political funds? Is an IP address a reasonable test of eligibility? Is physical residence?

The emerging generations want to use services independent of location of “origin” and location of “delivery”. Attempts to create artificial scarcity (by holding on to dinosaur constructs like physical-location-driven identity) are being responded to by a whole slew of spoofing and anonymisation tools; as the law becomes more of an ass in this context, you can be sure that the tools will get better.

For centuries now we’ve been learning about what happens when barriers to migration get reduced, as people, goods and capital flow more freely across borders. Countries haven’t disappeared as a result; but their powers tend to be modified to suit the borderlessness.

2011 is the year where we’re going to see this accelerate in new ways, as the implications of the copy-machine nature of the internet permeate every facet of our lives, including, but not limited to, government, business, health, education and welfare, rather than the traditional web-was-built-as-distribution-mechanism-for-films-music-and-advertisements hogwash. 2011 is the year we transform ourselves as we accelerate the move from things analog to things digital, as we continue the shifts from static to dynamic, from stabile to mobile, from on-premise to cloud, from individual to community….. and from international to global.

The un-national generation is here to stay. And they’re on the move.

Merry Christmas, Happy New Year, Happy Holidays or whatever else takes your fancy

Whatever it is, I hope you’re able to take some time off to relax, to refresh, to recharge yourself.

I’m going to try my best to be offline for a long while. So, in the holiday spirit, I wanted to share a few things with you very quickly.

First and foremost. Wolfgang’s Vault. I’ve been using the Vault for some years now, yet I don’t remember writing about it.The free streaming live music alone makes the site worthwhile; I’ve chosen to be a paid-up WVIP, and for a (shy? not really) retiring hippie like me, the vault is Fort Knox. There’s gold in them thar hills. Take today for example:

Visiting the site, I was greeted by new live videos of The Allmans/Whipping Post, The Band/King Harvest, Ten Years After/Love Like a Man, along with some fresh Zappa. How can you top that?

And all this, a few days after I’d received this book in the post, along with a bonus USB stick carrying some fabulous Airplane tracks. They’re going to be listened to on the way to Calcutta.

To me Wolfgang’s Vault is an extreme nonrival good. My enjoyment of the Vault is not diminished one jot or tittle by the act of my sharing news of its existence. Incidentally, the iPhone app is pretty good as well.

From music to books. I was at Waterstones yesterday, idly looking around, hoping to stock up on some analog reading matter for the journey. And I met Stephen Benatar, who’d set up a table and was selling his books there, largely self-published. What a nice man. We had a chat for a while, I landed up buying four of his books (the only ones he’d got on sale that day), and I like everything I’ve read so far. An interesting talent. I look forward to discovering more of his work.

From books to food. Have you read Alimentum? Fascinating journal, describes itself as “the literature of food”. Read two issues so far, very good.

And finally to an old friend, one I haven’t seen for a while. I will have to correct that.

Hugh MacLeod. Hugh’s usually in good form, often in fine form. Here’s his latest, on the high-end microaudience:

It’s not just tidings of great joy that Hugh writes/draws about, he has this uncanny ability to touch you where you’re still able to feel something. So if you haven’t discovered Hugh yet, now’s the time.

But in the meantime.

Tidings of great joy to all of you.