Networked information society: what it means for your business

My blog posting activity has been on the light side recently. This posting marks the return of more regular postings.

Wealth of networks

If you have not yet read The Wealth of Networks by Yochai Benkler, can I recommend that you do. The main theme of the book – that the networked information society creates social value – is at once a great challenge for the 21 century, and is also one of the great opportunities.

It’s challenging to those that hold dearly on to the main elements of 20th century market economies: exclusivity, wealth measured in monetary terms, the organisational power of the firm, the nation state, consumerism and the media. The networked information society is challenging to accountants, economists and management consultancies, the rationale of all being bound by the main elements of market economies.

Information is not scarce. Knowledge is not bound by centralised control. Indeed, the value of knowledge and information grows with sharing. Networked social value is not exclusive property. Not only is it possible for people to be well-organised in networked relationships online, it is actually very easy – and adaptive and resilient too. The value of networks transcends organisational and jurisdictional boundaries. Can you put any of that on a balance sheet – or confine it to a national identity? Hell no!

The networked information society creates social value through connections between people. Social value is created through shared creativity, expression and reputation. In The Internet and the Project of Communications Law, Susan Crawford described it this way. “…the greatest possible diversity of new ideas that will support our country in the future will come from the online world, because of its special affordances of interactivity, interconnectivity, and unpredictable evolution” (page 6). Written in 2007, don’t those words seem that much more important in the global economic meltdown. Oh, and while referencing Susan Crawford, another take-away from her piece is: don’t treat the internet like a content-delivery supply chain. It’s greatest value is in human connections and relationships online.

Implications for the firm and other institutions: it’s about relationships, not things

Get networked! Participate and engage with your customers, stakeholders, citizens, people everywhere. Get to know them better. Anticipate their needs. If you have something of value to them, go directly to them. Avoid intermediaries.  Invite them to know you better. Collaborate with them. People are influenced by those they know about and trust. Share to grow. Use others data and platforms where you can.

Reach out and use the scale of the internet to go beyond your town, your region, your country.

Use mulitmedia. People are more passionate, more emotional with video interaction. There is far richer connectivity. Tell stories about you, your service or product.

Proponent of free markets = practitioner of free thinking

Unaccustomed as I am to being provocative, about the subject line…how often does the equation hold true?

Technically speaking, those that champion competition also champion the communication of information. Don’t they?

Whither competition but for openness and innovation? Is that not so?

Social networking facilitates the exchange of information and ideas. Openness fosters innovation and competition.

How many of those that champion competition, also champion social networking? How many of those that champion innovation, champion openness?

In a networked economy, what of this holds true for you?

Just a few questions to prompt some thinking.

Internet use and culture in China

For some months now I’ve been taking more interest in scanning Internet use trends in China. Intuitively, I feel that China will be a centre of innovation and influence in the emerging Internet culture globally. The latest stats reported in the China Web2.0 Review reinforce my view.

At 253 million users, China now has more Internet users than any other country. Internet users with broadband amounted to 214 million. Sure, there is some way to go in terms of penetration overall, but the growth rate remains high (43 million new users were added in the first half of 2008 ) and the number of mobile Internet users now stands at 73 million. Mobile Internet growth rates exceed PC rates.

Overall use figures in themselves are of considerable interest. But it’s the social change indicators in the use stats that are more fascinating to me. 107 million users (or 42% of all users) have blogs or ’spaces’ online. Many users write posts on social networking sites. 70 million updated their blogs or spaces in the last six months. Over 80% of users listen to music online, use IM and read news online.

To me these figures say that Chinese Internet users have taken to the Participative Web in a big way. I have no doubt that innovative Web applications like Goofy2 foreshadow much more innovation from China downstream.

Disconnected Institutions

People have told me I am good at asking the right questions. Here’s a few.

What is the best way to keep pace with social, technological, economic, environmental and political developments?

If your answer was social networking over the Internet, pat yourself on the back. If not, you have some other questions to ask of yourself.

Social networking over the Internet transfers power & influence from institutions to networked individuals. As I’ve said before, mainstream media go to Twitter as a source of breaking-news. Want to know what’s happening on the ground in an emergency, go to Twitter. Want to connect to thought-leaders and their networks? Sign-up to FriendFeed. Want to run a check on what’s hot? Try Digg.

For those that got the right answer to the first question, now ask: What would your organisation’s answer be?

If your organisation is not participating on social networking over the Internet, your organisation is disconnected from an increasingly valuable stream of knowledge and information.

Australian Institute for Public Policy

A new public policy think tank is being set up by the Australian Federal and Victorian State Governments in partnership with the University of Melbourne. The institute is to be modelled on the Brookings Institute in the United States. Dealing with domestic and international issues, topics are to include energy policy, climate change and Australia’s role in the region.

Andrew Leigh suggests that, in an increasingly crowded think tank space, the institute would be best placed to “…carve out a domestic policy niche, looking at urban policy, crime policy, health policy, schools policy, innovation policy, IT policy, etc.” While not decrying from the view that domestic policy debate on these issues are worthwhile, I note that the Brookings Institute research covers internet policy. As a ‘global network of networks’, and given the rapid rise in social and economic importance of the internet internationally as well as in Australia, I would suggest the AIPP may well have a role there too. The issues transcend domestic, regional and international public policy debate.

A recent policy brief from the Brookings Institure is of interest – Using the Media to Promote Adolescent Well-Being (Donahue, Haskings, and Nightingale). The authors advocate using the media to “…provide positive messages that counteract the negative and potentially damaging messages to which they are so frequently exposed”.

Structural differences Australia and global entertainment & media industry

During the course of researching market developments I had cause to revisit PriceWaterhouseCoopers Australian Entertainment & Media Outlook/2007 – 2011 (June 2007).  One issue really stood out – a key difference in the Australian market compared to the global situation.

By 2011 Newspapers are forecast to lead the field in Australia (including Internet, Free-to-air TV (FTA), subscription TV and others) in terms of total industry spending, accounting for 20 per cent of the top 10 categories of spending.  The Internet is forecast to come in at second place followed by FTA and subscription TV.

Now for the global comparison – newspapers are forecast to run it at 4th place, accounting for 11 per cent of spending. Globally the leader (by a comfortable margin) is the Internet accounting for 19 per cent of revenues. Globally, FTA, subscription TV and newspapers are in the top four. 

Newspapers came in first place globally in 2006 but are forecast to fall to 4th position by 2011…while in Australia, newspapers retain “the pole position’ in the forecast period. There are other differences too (such as filmed entertainment forecast to be ranked at 1oth globally and 5th in Australia by 2011). But the most interesting one is Newspapers, Sure, the Internet is hot on the heels of newspapers by 2011 but the comparison internationally appears to be significant.

Now here’s the thing – I don’t know why. Are there any views on this?