The Global Internet Economy [Hardcover]

Bruce Kogut (Editor)

Book Description

Publication Date: January 3, 2003

By 2002, all but a handful of countries were connected to the Internet. The intertwining of the Internet and the globalization of finance, corporate governance, and trade raises questions about national models of technology development and property rights. The sudden ability of hundreds of millions of users to gain access to a global communication infrastructure spurred the creation of new firms and economic opportunities. The Internet challenged existing institutions and powerful interests: Technology was global, but its economic and business development was molded in the context of prevailing national institutions.Comparing the experiences of seven countries -- France, Germany, India, Japan, Sweden, South Korea, and the United States -- this book analyzes the rise of the Internet and its impact on changing national institutions. Each country chapter describes how the Internet developed, evaluates the extent to which the Silicon Valley model was adopted, and suggests why certain sectors and technologies developed faster than others. The book also analyzes specific Internet sectors and regulations across countries. It shows that the Internet's effects are more evolutionary than revolutionary. At the same time, the impact of broad cultural change on entrepreneurial aspirations is clearly visible in certain nations, especially India and Sweden.

Editorial Reviews

Review

"An amazingly good book, written by two lawyers who really know what is (and was) going on. Everything in this extremely complex industry is covered, thoroughly and lucidly. This book makes the murky subject of telecommunications as the base technology for the Internet crystal clear, and the authors get it right."--Gerald R. Faulhaber, Wharton School, University of Pennsylvania, and former Chief Economist, Federal Communications CommissionPlease note: New affiliation added.

"I am confident this book will become a truly important reference point in the years to come." Prescott C. Ensign Administrative Science Quarterly

"Witty, literate, and right on target, Rohlfs captures the economic and business principles of network ('bandwagon') effects in today's hottest sector of the economy. Network effects is the word du jour in the current business jargon, and many apply it where it doesn't work. Rohlfs is careful and convincing in laying out the theory, and absolutely on target in the many carefully researched examples he uses. The book is fun to read as well as incredibly useful in sorting out the wheat from the chaff. Rohlfs is the true pioneer of bandwagon/network effects, having discovered the concept almost thirty years ago. With this book, Rohlfs shows he is still the master, not only of the underlying theory but also of its practical application to a myriad of business situations. If you need one book to read on bandwagon/network effects, this has to be your choice."--Gerald R. Faulhaber, Wharton School, University of Pennsylvania, and former Chief Economist, Federal Communications CommissionPlease note: Endorser gives permission to excerpt from quote.

"This book takes one inside the global internet phenomenon and simultaneously reveals its national variants. It's a unique volume, of value to both student and teacher."--John Zysman, Professor of Political Science, University of California, Berkeley

"The scope of this book is breathtaking: while the conventional wisdom is that the Internet transcends borders and 'Americanizes' the world, this book takes a careful look at the Internet experience in many countries and punches gaping holes in that conventional wisdom. Carefully researched and highly readable, it is essential reading for business leaders, policymakers and academics grappling with the Internet's global reach. The book's broad vision and wisdom are a tribute to the many contributors, taking it several steps beyond the usual breathless treatment of the advent of the information age. Kudos all around!"--Gerald R. Faulhaber, Wharton School, University of Pennsylvania, and former Chief Economist, Federal Communications Commission

"This collection examines the growth and diffusion of the Internet from the perspective of the national systems within which it developed. The book makes significant progress in developing this theme, and its lucidity and breadth are impressive."--Mark Casson, Professor of Economics, University of Reading

"An often brilliant exegesis of how postindustrial thinking has come to occupy the heartland of consciousness, and of the wrenching social consequences that have attended this transition. A book that is moving, as well as erudite."--Dan Schiller, Professor of Library and Information Science, Communication, and Media Studies, University of Illinois at Urbana-Champaign

About the Author

Bruce Kogut is the Sanford C. Bernstein & Co. Professor of Leadership and Ethics and director of the Sanford C. Bernstein Center for Leadership and Ethics at Columbia Business School.

Product Details

• Hardcover: 536 pages
• Publisher: The MIT Press (January 3, 2003)
• Language: English
• ISBN-10: 0262112728
• ISBN-13: 978-0262112727
• Product Dimensions: 9.2 x 6.4 x 1.3 inches
• Shipping Weight: 1.9 pounds (View shipping rates and policies)
• Average Customer Review: 5.0 out of 5 stars  See all reviews (1 customer review)
• Amazon Best Sellers Rank: #4,493,838 in Books (See Top 100 in Books)

Customer Reviews

Most Helpful Customer Reviews

2 of 2 people found the following review helpful:

5.0 out of 5 stars A rear-mirror view of the Internet Economy, June 1, 2003

By 

"matti_m" (Espoo, Finland) - See all my reviews

This review is from: The Global Internet Economy (Hardcover)

This is an excellent history of the Internet Economy and as such highly recommended. Without no doubt one of the best history books available.

The book is somewhat difficult to evaluate because the topics covered are so broad. The book describes how things did happen. But it does not try to predict or construct the future. It must be compared to Moschella's Customer Driven IT which identifies the challenges of the innovation system and draws a different scenario.

The deregulation and disintegration of the hierarchical telecommunications industry to free market based structure is described in this book as in some others. When the e-commerce did not catch up to the degree originally expected, Internet is paradoxically heralded as a remarkable social success, with rapid global penetration, but largely a business failure (Kogut, page 438). But this claim - like a typical market research - focuses on revenue generation and reintermediation, and does not recognize the intermediate form between hierarchy and market, the networked process and related disintermediation. In The Global Internet Economy, this comes as some kind of an afterthought:

"A primary effect of the Internet has been to render the back-office operations, such as customer service, more efficiently. These activities were not captured in the definitions of B2B and B2C but may in fact constitute the bulk of the explanation for the increase in productivity observed in the 1990s" (Kogut, page 443).

From consumer perspective, Internet may substitute or streamline many key everyday processes, such as going to library, or to look at prices in the shops, or buying tickets or paying bills. It is this convenience value is undervalued in Internet productivity statistics (Kogut, page 459).

This is the third phase in the formation process of an industry. In the first, pre-commercial and early commercial phases government and universities played vital roles. In the second phase, venture capital (with the ease of exit provided by new technology-oriented stock exchanges) was the midwife for creation of the industry, and in the third phase large firms were able to integrate the techniques into their technological toolkit (Kenney, pages 69-70).

"The U.S. institution of venture capital played a central role in the rapid formation of new dedicated Internet firms that were established to define and occupy the new economic space" (Kenney, page 70). Almost 90 % of venture capital in the latter half of the 1990s vent to Internet-related companies (Kogut, page 446).

As a summary, this book is about history. Now when we are in that "third phase" we need scenarios and roadmaps for the future, but the book does not try to synthesize these.