 Born in 1952, has no college or university degrees  Publisher and editor of Whole Earth Review from  Helped launch Wired magazine in 1993, and served as Executive Editor until 1999  Currently Editor-At-Large for Wired

 Founding board member of WELL  Member of The Long Now Foundation  Two famous books › New Rules for the New Economy › Out of Control

 Tracts of the information networking universe  Rules of value to be found in relationships  Importance of looking out of your box  Maximize innovation and maximize the fringes

 Sleek and efficient corporate model  Failure of traditional business practices in the modern business world  Network fears vs. liberal arts excitement

 The net is our future  Chips  Dot of intelligence  Connecting everything to everything  Small becomes smart

 Doors  Cars  Phones  They transmit simple messages  “I’m here!”

 As membership increases, network increases  n² = n*n  network growth  Networks encourage the successful to be more successful

 Industrial › Gradually › Single Organization › Benefits one company  Network › Exponentially › Shared by the entire network’s value › Increasing returns

 Industrial › Organization’s benefit  Network › Value › Silicon Valley  Advance technology  Social organization

 Expect bad things to happen  Changes occurs over time  Value & membership

 Need than luxury › Consumer products  “Technology has become our culture” › Internet, telephone, TV, computer  Tipping point

The fax effect

 Anticipate the arrival of cheapness  Prices Invert as the quality of items improve  The price of goods and services decreases as technology improves

 Every item will invert in pricing and eventually become free  The Goal: invent items faster than they are commoditized

 Most Cost Effective Way to gain increasing returns in the economy is to make items free  Consider the Netscape Example

 Consider these questions… 1. Is the freebie worth more than a silly premium? 2. How will you eventually capture the support of customers if there is no initial flow of money?

 Act as if your product is free  Invest in the first copy  Selling the ancillary products

 Networks have no clear center or outer boundaries  Distinction between us and them becomes less meaningful in a network

 Primary focus of a company:  Shifts from maximizing a firm’s value to maximizing infrastructure whole.

 Demand of strongest commitment  Only one standard will ultimately prevail  Uncertainty level is still high  Risks for being wrong are greater

 One standard so widely accepted  Becomes embedded  Nearly impossible to dislodge

 Standards hasten innovation  As they’re established, growth takes off

“As more of the economy migrates to intangibles, more of the economy will require standards.” - Produces a yin-yang tradeoff

 Positive side  Consumers keep most gains in productivity  Consumers get cheaper prices and higher quality

 Negative  Consumers have never-ending decisions to make  What to buy, when to upgrade/switch, what standard to join

 As we use computer chips more, we will find that the world will become more computer-generated.

 Instability and disequilibrium are the norms  Be aware of the peak  Must go downhill before innovation

 Shortsightedness  Global perspective  Adapt number of different practices at once  IBM  Easier to start new organization then change successful old one

 Places vs. Spaces  The Shift from Places to Spaces through Electronically Mediated Spaces

 The only side a network has is outside › Outsource chores to other companies which are within your network  Prepare for flash crowds › Mass audience goes from one hot spot to another, you must always be ready

“If the system settles into harmony and equilibrium, it will eventually stagnate and die.”

 To sustain a perpetual disequilibrium  robust growth sustains itself by poising on the edge of constant chaos  constant innovation is perpetual disruption

 Economy builds on constant extinction of companies that are outpaced  Careers will begin to resemble networks of multiple commitments

 To undo the industrial economy  flux of innovation permeates new economy like efficiency permeated industrial economy

Networks are in a constant state of flux.

“To achieve sustainable innovation you need to seek persistent disequilibrium.”

 Must chase after disruption without succumbing to it  Must remain perched in an almost-falling state

 The central economic imperative of the network economy is to amplify relationships. › The way to do this is through a NETWORK

 Structure to generate relationships  Members relate as peers › Help make things better

 Def – To fuse producing and consuming into a single verb.

 Prosuming occurs mostly online  When people prosume on large scales, it is called Mass Customizations

 Lets producers cater directly to you  Leads consumer to be happier with final result

 Smarter relationship technology  P3P cards – track information

1) Create a tailored product 2) Recalling preferences intelligently 3) Anticipating what they (the customer) want before they articulate it. -Example: Firefly, Amazon

 Helping to increase sales  Makes the producer smarter  The next step is using it for ‘tangible’ items when shopping

 Consumers now have more of a responsibility  “The new economy begins with technology and ends with trust,”  Alan Weber

 Economics were based on year to year  Focusing on long-term outcomes › Growth of world economy increasing in long run  Global infrastructure = $4 quadrillion

 Great Asymmetry › Creating more than you destroy  Leads to opportunities for people to build off › Innovative technology  Technology increases amount of opportunities available

 Thought new technology = more productivity  Increased efficiency = more productivity

 Productivity is for machines › Has increased over the years  Opportunities is for humans › Requires innovativeness, risk, guesswork  “What is the right job to do?”

 After time costs decrease and productivity increase › Communication and experience  Increases efficiency

 Ideas of primary needs have changed  Desire for luxuries = new primary needs  Technology influences these desires

 One leads to two, two to four, etc.  Look into what can be built from this innovation