Posted by toxic — Nov 23, 14:04 NZST
Bob Metcalfe has one that's been in the news again lately. So does Mike Godwin. Voidmstr's is one of my favorites. There's an unattributed one about arguing on the internet that became an instant classic. And Gordon Moore's has held true for longer than the ARPAnet has existed. The commercial Internet has been vital to my livelihood for nearly 15 years, and somehow, I've escaped the burden of having a law attributed to me.
This is a good thing. If there were a toxic's law, it would be about what happens when you use a small portion of someone's blatantly obvious statement to justify your own belief in your own hype, while summarily ignoring the context of their statement, the external facts that surround it, and the obvious dangers posed by believing your own hype.
And inevitably, it would get reflexively used out of context to help justify someone's hype.
But I digress...
Someone who will remain nameless is in the process of building yet another social networking service. It will allow you to stalk your friends' friends, post pictures of ceiling cat, and leave messages that say little more than "OMFG, U l00k sooooo hot in your pix. LOL! Can I b ur friend". It will neither make, nor save users any money. It may get some of them laid, and the visionary behind the product once told me that he'd like to see it read email (OMG! JWZ's Laws!).
This morning, he sent me a link to this article from the Economist, penned by Eric Schmidt (formerly of Sun, now of Google). Go ahead and read or skim it (it'll open in a new window). I'll wait.
OK, so now you know that it's telling you not to bet against the Internet, because there's lots of new technology that's yet to be developed, and virtually everything that is on the cutting edge today is disruptive to traditional business. VoIP is a serious threat to telecommunication monopolies, and lots of people have their targets set on the Cable TV industry. Why? Because the Internet is based on simple, open standards, and that fosters competition that forces products to improve faster and get cheaper, or get left behind when a competitor steps in and builds something better, taking your users. Attempting to control your consumers or create what used to be known as "Vendor Lock-In" will always backfire on you (are you listening, Apple?). The telephone and cable companies success is due to the inherent vendor lock in provided by their business models -- your choice of traditional cable and telephone companies are dictated by what zip code you live in.
So... what did this visionary of the
next generation of social network take away from this article? The last
two paragraphs. Go ahead and read them. The
lesson is compelling: put simple, intuitive technology in the hands of
users and they will create content and share it. The fastest-growing
parts of the internet all involve direct human interaction.
Imagine that! The fastest growing portion on the world's global communications network is the portion that involves communication. And this is why the Internet needs another social networking site.
So. What are we ignoring here:
1. Google's primary foray into allowing users to create content is Blogger.com (which is also blogspot). Depending on whose numbers you trust, between 10,000 and 70,000 new blogger pages get created every day. Unfortunately, most of these pages are what's known as a splog, or spam-blog. Give the users easy tools to create content, and people will use them to game the search engines, and try to sell you blue pills. Google, of course, is responsible for AdWords, the largest advertising network on the Internet. Many of these splogs are used to create and raise the ranks of ad farms. Ad Farms are useless to the Internet community, but they generate revenue for both the owner of the farm, and for the provider of the ads (usually -- you guessed it -- Google). Google has no financial incentive to keep the splogs off of Blogger (they make Google more money than your pictures of James Traficant's implausible toupee). If you've been on MySpace lately, you'll notice the same thing happening there. While it once was "a place for friends" or "a place where good friends and girls meet", it is now just "another place for spam". Do you really want to be Burger King's friend?
This is the future of the Internet?
2. What's the current #1 generator of traffic on the Internet? This may be a surprise to some readers who insist that Alexa is a reliable measure of popularity, but it's BitTorrent. Numbers vary (Mary Meeker claims it to be as high as 60%, companies selling appliances designed to help ISPs throttle it are claiming closer to 30%), but virtually everyone who actually runs a network seems to agree that it's overtaken email as being responsible for the most bits flying around on the wires today.
(As an aside -- ISPs are purchasing infrastructure to throttle torrent traffic (while still marketing "unlimited" connections), but they can't seem to stop the russian botnets from drowning your email box in millions of stock market related spams? WTF?)
OK. What is BitTorrent good for? Right... mass distribution of content. Taking one thing, and putting it into the hands of as many people as possible. This is something of the opposite of "Tools that allow average people to create and share content". It's really a tool that allows many people to consume the same slick media that is produced by someone else (usually, this content is made up of movies and TV shows, which are produced professionally (and which Hollywood fights tooth-and-nail to try to keep consumers from distributing)). Sure, there is legal content on BT, like Linux DVDs and freely distributable, but still professional, shows like PBS's NerdTV. But that's the exception.
3. But what about YouTube? Yeah... what about it? For every person who watches an amateur vlogger, or the guy from the Monkey Chow Diaries, one thousand watch the professional actress who portrays lonelygirl15, and twenty thousand watch clips that CBS repurposes from The Late Show. YouTube's success is not about the ease of content creation (though to justify the rampant copyright violation going on there, YouTube has to claim that it is). It's about the ease and inexpense of content distribution. Most of the content that's distributed is still professionally produced. YouTube and JumpCut didn't equalize video creation any more than Podcasts obsoleted radio. it just made it easier for viewers to find stuff that they want to watch. But that's not what people are using YouTube's success to justify. There's a big difference here.
Smart investors aren't going to bet against the Internet, because it's still disruptive, and it's still evolving. Savvy BitTorrent users have already created their own video-on-demand services, despite the cable companies' many attempts to build such a beast. VoIP allows me to have a US phone number here, completely bypassing the truly awful Telecom monopoly in New Zealand (not to mention, I can call just about anywhere in the world for a few cents per minute). We're just starting to see forays into realtime IPTV, which might someday beat out your Cable company (even the NFL is hip to this, partnering with Yahoo to offer people outside of the US the ability to pay to watch the TV broadcasts of all the games via Internet).
Various pieces of hardware are appearing that connect streaming and stored media of all types to your existing home theater/stereo. I'm listening to WNYC on my stereo right now, from halfway around the world, and later (if I wanted to violate US law and receive it via BitTorrent) I could watch The Daily Show on my TV, even though it's not shown in this hemisphere. And that's a lot more compelling content than someone mumbling into a webcam or stoned talentless teenagers lip-syncing poorly to songs from Avenue Q (without paying royalties). It is the consumption of content that is driving the Internet, not the creation of it.
When we were in Venezuela, NPR simulcasts were our connection to the news of the world -- in stereo sound that's better than most of the overly compressed stuff on the FM broadcast spectrum today. This level of communication, even to underserved parts of the globe, was unthinkable just a few years ago. It's a hell of a lot easier to upgrade the software that distributes audio and video across fiber optic lines than it is to upgrade the television satellite once it's been in space for 10 years, or to fix your shortwave transmitter. The internet companies know this. The media companies are trying to pretend that it's false (and issuing lawsuits to people who prove them wrong). Knowing that better/faster/cheaper technology tends to win in the 21st century, it's no wonder that Google closed above $500 a share today.
But are smart investors still betting on Social Networks? Or is giving people the tools to create content for their friends just a way to become the next Geocities.
Only time will tell.
[Full Disclosure: This year, I will be receiving a 1099 from both BitTorrent and the company building the new social network]