[Note: This is a follow-up post to one I wrote earlier this month]

For nearly a decade, I have espoused the view that every artificial scarcity shall be met, and ultimately overcome, by an appropriate abundance. I think it’s time to view this statement in the context of platforms and “leakage”. Let me explain what I mean.

By now many of you should have heard of Karen Murphy, the pub landlady from the Red, White and Blue pub down in Portsmouth. She did something very simple: she installed a decoder that let her pub regulars watch English Premier League soccer matches beamed over from Greece, paying a lot less for the service than she would have had to pay Sky for the privilege.

I quote from the article: “Juliane Kokott, one of the eight advocate generals of the European court of justice, advised that selling on a territory-by-territory basis represented a “serious impairment of freedom to provide services”, adding that the “economic exploitation of the [TV] rights is not is not undermined by the use of foreign decoder cards as the corresponding charges have been paid for those cards”.”

Selling on a territory-by-territory basis represented a serious impairment of freedom to provide services.

Hmmm. This is a serious point, and all that this post is about.

When you make something digital and connect it to the web, it becomes available everywhere, it becomes available immediately. That is the essence of the abundance that the web represents. Instant. Everywhere. An extreme nonrival good.

This was not the way business was done in the past: for analog goods, territorial rights and licences were normal and natural; exclusive rights were less common, but nevertheless could be found, acquired, exercised.

As we’ve moved from the physical world to the digital world, incumbents in many industries have sought to preserve the historical structures and ways of doing business. Which, in effect, were attempts to create and exploit artificial scarcities.  When it comes to digital assets, there are four primary ways to try and create artificial scarcity:

1. Sell the rights to digital things on a territorial basis, and then sue those who seek to overcome those territorial barriers. The Karen Murphy case is just the example of the day…. the Bosman ruling in football was a similar case in point; every attempt to enforce gardening leave may also be seen as an attempt to restrict the freedom of the individual.

2. Encrypt the assets regionally, as done with DVDs and some classes of video games. [As I’ve stated so many times before, region coding on a DVD is the best example I know of a technological invention adding zero value to the customer or her experience].

3. Slice releases of digital assets not just over geographies but over time as well, drip-feed the releases into the world, again to protect a historical business model. I reviewed a Hugh Macleod book a couple of days ago, and a UK reader pointed out that the book will not be available here for a few months.  Hugh, the author, saw the comment and confessed that the publishing world seemed to insist on working that way.

4. “Lock” the assets to a particular device, provider, connection type. If you want to watch Premiership football, you must buy from Sky Sports. Or for that matter iTunes and iPod. That kind of thing. Walled gardens.

All these have been attempted. All these have failed, and will continue to fail. You cannot make something that is essentially abundant artificially scarce.

Where the law is called upon to intervene, as in Karen Murphy’s case, the law may decide to fight back against the artificial scarcity. Even if Ms Murphy loses her case, there will be another. And another. The artificial scarcity cannot hold. Where new monopolies are created, as in Sky’s exclusive rights to Premiership coverage, there will be Ofcom-like rulings to wholesale the content.

Where encryption or walled gardens are used, the fearful power of the web will be unleashed; encryption algorithms will be cracked and made available to all, as happened with iTunes or iPhone. DVD players will be “chipped” to support multi-region play. Ways will be found to unlock walled gardens.

Where time-slicing is used, and releases are artificially suppressed from specific territories, outbreaks of piracy will be more common, pushing back against the “second-class citizen” implications of being made to wait in the queue.

All this becomes very interesting when it comes to the cloud. Some months ago I wrote about cloud principles; at a level of abstraction, many of the comments can be viewed as requesting abundance where the scarcity is artificial. Portability of data, metadata, code is a classic example.

There was a time when institutions, both public as well as private, were intent on vertical integration. And it made sense. For a number of reasons. Firstly, it was the industrial age, and linear repetitive processes with low standard deviation was considered good. Secondly, land, labour and capital, the things we used to call the “factors of production”, were intrinsically immobile. Thirdly, the process of vertical integration genuinely reduced friction in manufacturing processes: transaction costs were lower as a result. And finally, consumer choice was unheard-of; any colour you like, as long as it’s black.

That was a long time ago. The bulk of humanity has moved out of the agricultural sector, leaving only the mega-corporation and the boutique, the military-industrial agronomist and the guerrilla smallholder. Soon this will be true of the industrial sector as well: the low-touch cost-leading hyper-global, and the high-touch quality-leading hyper-local will soon be all that remain.

For some time now,  the services sector has been where the action is. We’ve experienced the Information Age for over half a century; the knowledge worker has replaced her predecessors. Capital has been mobile for some time now, and labour increasingly so. A different world.

And now of course we have the internet. And the web. With their concomitant flattening and democratising. Where everyone’s an actor, with the power to write, to edit, to delete, to publish, the tools of trade of the knowledge worker. A worker who now has the power to access, edit, alter and disseminate information at high speed and low cost to all and sundry, in the language of their choice, to the device of their choice, when and where the recipient wants. A world where the distinction between information consumer and information producer no longer exists.

Which is where the problem lies. We’re going through a process of horizontalising of everything, of “small pieces loosely joined”, of “high cohesion and loose coupling”. Platforms are now no longer hierarchical, they’re closer to being independent layers, often of different sizes and shapes. Almost counterintuitively, the glue that reduces friction between layers is the API, that which allows the small pieces to be loosely joined, that which ensures that the small pieces are loosely coupled. It is this loose coupling, this high cohesion, that allows for the flexibility that underpins adaptive systems, and makes that which appears to be complex simpler.

In the Information Age, these small pieces start acquiring new roles; some consume information; some produce it; some do both; some make lists of information, index them, tell people where to find information; some translate information, change format, change language, render for different devices; some make the devices that support all this; some make the software that empowers everyone to do the consumption, editing, publishing; some transport the bits; some manage access and use rights.

All this happens in a digital world, where reproduction and transmission of information is becoming cheaper by the minute.

Attempts to implement end-to-end control in such environments are doomed to fail; in essence there is no point in attempting to tighten what is designed as loose coupling, it doesn’t work. Which is why platforms leak.

You can reduce leakage, by concentrating on keeping the information cohesive within the layer, and making sure the APIs work securely. You can reduce it further by increasing inspection and usage, by ensuring that the APIs are open. You can reduce it even further by testing each layer against as many conditions as possible, by avoiding lock-in between layers, by making sure the pieces remain small.

The horizontalising nature of the internet and the web, of the digital age, needs to be understood. Layers must be independent of each other. Where they are not, the joins will come apart. And leakage will happen.

Of course, given what happened with Wikileaks, given what happened with Egypt, there will always be attempts to recreate vertically integrated control.

And more leakage will happen. Because the internet, and the web, route around obstacles. By design.

[Note: I will attribute the photographs in this post in half a day or so, I closed the tabs by mistake; my apologies to the people whose works I have used, I will rectify as soon as possible].

Beginnings: congregations and stories

As long as humankind has existed, humankind has congregated. And whenever humankind has congregated, humans have used the opportunity to follow their passions and dreams, to tell the world their stories, to connect with others to make their dreams reality. Sometimes those dreams went against the grain of the society they were part of: the stories they told were stories of protest and pain and perseverance.

For as long as humankind has existed, we’ve had congregations where dreamers shared their stories, their passions and protests. But for most of that time, the ability to record and share what happened at such congregations has been limited, severely limited. Until very recently, we’ve had to rely on the memory of the people present and their ability to report on what happened. Initially, this was by word-of-mouth, passed on from generation to generation, vulnerable to the vagaries of memory.

The persistence of memory

Once we learnt to communicate in a more persistent form, as language evolved into symbolic representation, the risk of forgetting receded. But that of translation remained, since the conventions we used to represent language changed with time and distance. Contemporaneous accounts of such events do exist, but only where the right to publish the accounts existed as well. Where such contemporaneous accounts exist, they’ve also had to stand the test of time, and of the editors and translators who helped those stories travel.

With the advent of printing, scrolls and codices gave way to books, and the cost of sharing was lowered. It took a while before the cost of illustrating dropped as well, for some time it was done (or at the very least enhanced) by hand. So the stories of what happened at such congregations spread faster and farther.

Then came the eras of newspapers, of radio and of television, sharply reducing the time and the distance between events and the reporting of such events, and radically enhancing the multimedia nature of the reportage. But these were all largely broadcast in construct, with a small number of people at the centre controlling everything; the audience were channelled, not connected. Despite this there was a gentle emergence of voice at the edge, via phone-ins, letters to the editor, public broadcasting, and so on.

Empowered edges

With the advent of the internet, it became possible to connect more and more people quickly and effectively; when the Web was formed, the edge was empowered. Conversations between the connected became two-way. Search engines arrived and evolved: for the first time in human history, it became possible for all forms of conversations (audio, textual, video, face-to-face, telephone, synchronous, asynchronous, instant, whatever) to be persisted, archived, retrieved at will. As the mobile phone entered the fray, such conversations became ubiquitous as well; as the phone got “smarter”, with camera and recorder and GPS and what-have-you, the conversations became richer.

The age of platforms

So it should be evident that the technology used to manipulate, compute, process, display, disseminate and analyse information evolve in leaps and bounds over the past few decades. What is perhaps less evident is the consequential, sometimes parallel, evolution of the way the technology is made available to us. Once upon a time the tools by which we engaged with information were all “proprietary”, to the extent that each tool provider had a unique set; each set contained deeply vertically integrated components; migration between the set of one proprietor and another was not just frowned up but militated against; and the costs of entry, participation and exit were unreasonable.

That began to change as monopolies were broken down, particularly those of AT&T and IBM, and we saw the birth of Microsoft, of the “industry standard architecture” defined by the AT bus, of “open systems”, of clone PCs, of Linux, of open source. A new world emerged, where services were networked rather than hierarchical, horizontally integrated rather than vertical. The empowerment of the edge continued apace. [Some would argue that both AT&T as well as IBM have returned to their proprietary ways and scales, but that’s grist for a different mill, I have this post to complete.]

The emergent openness and horizontalisation reduced costs of entry and participation, with the result that the “stacks” became vulnerable to commoditisation. Aided and abetted by the laws of Moore and Metcalfe, standardisation, consolidation and virtualisation became everyday occurrences; people began to realise that these developments allowed immense leverage to be gained, as the barriers to entry and participation vanished: it became possible to connect very large numbers of people to each other and to the platform that brought them together; people generated information by just being, and added to that information by doing; the information grew ballistically as people started doing things together. The social network, underpinned by the cloud, was here to stay.

The leverage was less in the connections than in the ability of those connections to create and co-create. Which meant that the real value was in the digital fingerprints and footprints, the data generated. Information we never had, information we never knew we could have, information whose value we could only guess at. All this ushered in the age of the API; it made sense to empower communities to create the tools that would convert the information into value.

The platformisation of our environment

Networks and communities of people have been empowered with tools, largely cloud-based, accessible via mobile multipurpose”smart” devices; the broadcast audiences of yesterday can now interact with others at will; the static living room has been replaced by the ubiquity and freedom of the mobile device; content creation is now democratised, carried out by a much larger segment of the population; the stations and channels of yesterday are now themselves social networks; Twitter and Facebook are not just news feeds but EPGs as well, curated by your own personal social network.

Historically, people who attended specific events formed transient communities, ethereal, temporary, fragile. It is not that easy to bring together the people who were present at Dealey Plaza on 22 November 1963, or at Wembley on 30 July 1966. Today, with the tools we have, these communities are platforms as well.

Modern platform characteristics

• Platforms connect people
• Platforms  facilitate publishing
• Platforms enable protest
• Platforms create value
• Platforms need curation
• Platforms can constrain

The World Economic Forum, viewed from this perspective

The World Economic Forum is a platform, much like Facebook, or Wikipedia, or Mozilla, or TED, or the Olympics. Or even the United Nations. Or the IMF. Or for that matter the Financial Times. WEF brings together a large amount of people, far greater than the three or four thousand who make it to Davos every year, or the similar number who make it to “Summer Davos” in Dalian or Tianjin.

Connecting people

As with any other platform, WEF connects people together. Over the years, the tools that enable people to connect have improved and continue to improve: tools that help you discover who else is there, that help you arrange to meet those you’d like to meet, that facilitate your going to the sessions that interest you. As discussed, the tools have become more mobile, more interactive.

The media often portrays WEF as a “jolly”, where thousands of overpaid people eat, drink and make merry all week long, interspersed with celebrity pontifications from the great and the good, usually drawn from the political and industry-magnate classes, punctuated by the odd real celebrity. Now I can’t blame the media for that; since time immemorial, as with any other industry, the people who run the media seek to make available for purchase what “sells”. In this context, bashing politicians and magnates gets considered a sure bet.

But there’s another WEF, a WEF I wrote about last year, where many of the people aren’t celebrities, where no pontification happens. A WEF where people meet in small groups and try and figure out how to make the world a better place, one tiny little piece at a time. A WEF populated by people like Juliana Rotich of Ushahidi, Carol Realini of Obopay, Daniel Domscheit-Berg of OpenLeaks, three of the people I had the opportunity to spend time with over the past few days. People who are working really hard to give others a chance to have a voice, to be able to produce and consume valuable information at low cost. Information that saves lives in a crisis, information that helps enrich the quality of life even when not in crisis.

Facilitating publishing

WEF at Davos is about hundreds of events, most of which aren’t covered in the mainstream press. In the past, you were unlikely to know about them unless you were there. But today things are different. For example, anyone can visit this site, access, view and download summaries for most sessions. This year, session agendas and summaries were available in electronic form for all delegates, so you could choose a no-trees-damaged version if you wanted. As you would expect, there were mobile and tablet apps for all this as well, along with a small and hard-working social media team covering the facebook, twitter and youtube angles.

Enabling protest

Khruschev banging his shoe on the table at the UN; Tommie Smith at the Olympics; Marlon Brando not at the Oscars; India refusing to play South Africa at the Davis Cup in 1974: throughout history, especially our recent history, regular community events are natural places for protests to take place. If anything, this will accelerate as the tools for dissemination improve.

Of late, a new form of platform has emerged, allowing protest in a different way. The “leaking platform”. Essentially this is a place where whistleblowers can go to and be guaranteed anonymity. Wikileaks is just an example of this class of platform; OpenLeaks makes the concept more easily understandable: a politics-neutral vehicle for people to pass on confidential material to publishing organisations while retaining their anonymity.

Creating value

If you get the chance, take a look at what the Global Education Initiative does and has done. Or what the Tech Pioneers and Young Global Leaders do. Just three out of a couple of dozen initiatives that really define what the WEF is about, rather than the razzmatazz you hear about. Small teams of people working “on the ground” in countries where the conditions are not conducive to ease and relaxation. Not exactly days of wine and roses. Hard graft at the edge, creating value where it counts. Changing lives, sometimes one life at a time. WEF gives these people a platform to meet others, to express their dreams and desires, their concerns and constraints; the connections made help raise funds, influence policy, eradicate barriers, provide mentoring and guidance, swap stories and experiences.

You can find a list of WEF communities here.

Needing curation

Every community has its 1000lb gorillas, its moderators, its core; just look at any opensource community and you will see what I mean; every platform has its editors, its policymakers, its gatekeepers. So it is with the WEF, and a Davos ticket is therefore hard to get. Now before you go into a tizzy about the costs of a visit to Davos, think about the entry and set-up costs of other global events, such as the Olympics (the next Olympics will cost about £10 billion to hold; if you were to attend the opening ceremony, the closing ceremony and just the finals of all the events, it would set you back about £14,000 per person at published prices); other examples of global events you should think about are the soccer World Cup, the IMF annual meeting, the Doha talks, Kyoto, you name it.

You can’t have six million people at each of these events in person, even if all of them could fit on the Isle Of Wight. So some form of curation takes place, of the attendees as well as the content created and published. Sometimes the curation is based on qualification criteria, sometimes it’s economic, sometimes it’s a ballot. Whatever route is chosen, it’s normal for attendance to be filtered. And it’s necessary.

I made Davos last year, I made it this year. I’ve never been before 2010, and I may not darken their doors again. But it doesn’t worry me. It was a privilege to have been there, to have met the people I met, to have had the conversations I had. I would like to be there again, but not being there would not worry me. What would worry me is the possibility that  people continue to have misconceptions about what Davos is about.

Platforms can constrain

Which brings me to the final point of this post. At Salesforce, where I work, we hold a senior management meeting every six months or so; in the past, staff who weren’t invited tended to think of the meeting as a gathering of the illuminati (to use Marc Benioff’s words). Such meetings used to be like Vegas, with what happened there staying there. This was normal in most companies, because the tools for participation and sharing just weren’t there. Until Chatter came along; now, everyone in Salesforce can be part of the meeting, place-shifted, time-shifted. And the buzz is tremendous, the capacity to create value is considerable.

So it is with WEF. Platforms need to be open. And WEF has come a long way in this, breaking away from the exclusive holy-of-holies mould. Competitions were held this year to allow people to enter based on the video messages they shot; summaries of sessions are available to all; some of the sessions were televised, others shared via YouTube. Bloggers and tweeters were everywhere. More people had access to what was planned, and to what took place,  than was ever the case before.

Conclusion

I’m someone who prefers to look for the good in things, who prefers to “take the beam out of my eye” rather than point out the mote in someone else’s eye. It’s easy to criticise WEF and Davos; if you must criticise, then it is worth doing constructively, in possession of the facts and while providing examples of what good looks like. There are many things I could criticise Davos for, but exclusiveness and gratuitous consumption are not anywhere near the top of my list, particularly when I compare it with any other global events.

I will be writing more about Davos and about what happened there this time, perhaps one or two more posts, primarily on “leaking platforms”. In the meantime, I hope that at least one person out there has a better understanding of what happens there.