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Deep Thoughts on Social Media and The Internet
on May 30, 2011
The subtitle of this book is "Revolution doesn't happen when society adopts new technology, it happens when society adopts new behaviors." Nice tag line, and a good entry point into this penetrating examination of how the Internet and Social Media are transforming the world we live in. Shirky covers complex content with humility, humanity and skill.
Here Comes Everybody is a remarkable book. Shirky states that the Internet is the biggest disruptive force since the telephone, television, transistor and the birth control pill combined. I've heard others say the printing press, and a blog I read recently compared the Internet to the invention of alphabet. In any event, it's a watershed event.
In this book's well-edited pages Shirky says, "Philosophers sometimes make a distinction between difference in degree (more of the same) and difference in kind (something new)." Social Media and the Internet represent something new. He adds, "When society is changing, we want to know whether the change is good or bad, but that kind of judgment becomes meaningless with transformations this large."
Central to this book is Coase's theorem. Coase won a Nobel Prize studying the economic factors of production inside of firms, a radical departure from traditional macroeconomic focus. Coase looked at transaction costs within and between firms (Contracting, Cooperating, Control) as a key unit of economic study. What he found is that three transaction activities have historically required significant cost and energy:
3. Collective Action
The Internet makes these activities much less expensive. Shirky sees the cost of sharing plummeting to zero, creating bargains for shoppers, and new challenges and opportunities for business. The Internet is also reducing the cost of categorization, digital reproduction and distribution. All of this is creating significant disruption for newspapers, advertisers, the post office, encyclopedias, the music industry, etc.
Shirky also sees disruption for attorneys, doctors, journalists, consultants and management professionals because of the readily available knowledge on the Internet. He says, "Professional self-conception and self-defense, so valuable in ordinary times, become a disadvantage in revolutionary ones, because professionals are always concerned with threats to the profession." And further, "Novices make mistakes from a lack of experience. They overestimate user fads, see revolution everywhere, and they make this kind of error a thousand times before they learn better. In times of revolution, though, the experienced among us make the opposite mistake. When a real, once-in-a-lifetime change comes along, we are at risk of regarding it as a fad"
Shirky sees cooperation as more difficult than sharing because it requires behavior synchronization -- and collective action harder still because it requires the commitment to the group and group governance, "or, put another way, rules for losing." He states that as a group grows arithmetically the complexity grows logarithmically. More people, more potential problems.
One potential solution to cooperation is shared awareness. He states that shared awareness in collective action has three levels: 1) When everybody knows something; 2) When somebody knows what everybody knows; 3) When everybody knows that everybody knows. For example, he talked about how radios transformed German Panzer tanks from military hardware into a new form of coordinated weapon, while the French saw tanks as accessories to infantry units. And today Internet apps are more pervasive and powerful than Walkie Talkies.
On a human level, Shirky shows how Social Media and the Internet is changing the way we interact, and how reciprocity, altruism, and even love are central in this new world. He even says that the Internet is making the physical world and relationships more important than ever. For these values to succeed, however, he states the need for social density and continuity, factors present in social media and in big cities. Shirky also tips his hat to Gladwell's work in the Tipping Point, which points to the value of mavens, connectors and salespeople (a hypothesis recently contested, however, through a research by Duncan J Watts PhD that indicates good ideas are actually the keys to memes going viral).
Following along on the human trail, Shirky explains Dunbar research indicating that human beings can only have about 150 meaningful relationships, and that the way these dense interrelationships interact can enhance or slow progress. Dunbar sets the stage for Metcalfe's Law, which says, "The value of the network grows with the square of its users" so when you double the size of the network, you quadruple the number of potential connections. Metcalfe's Law is the topped by David Reed's Law, which says that the value of the group actually grows exponentially since groups can splinter into numerous subgroups. As a category these theories are related to Power Laws, which include Zipps Law and the 80/20 Rule. All of this is seriously academic stuff, but when you think about it these theories explain the growth of Google, The Huffington Post and Facebook -- and why big established companies are valuable but have a hard time innovating.
Given the theoretical fixed limit of 150 meaningful human relationships, one of Shirky's solutions for the problem of Collective Action is to use connectors as ambassadors to different small groups. This is what cross-functional leaders and managers traditionally do, so it would be good to hear more about the behavioral nuances he sees. If you know of such work, send it to me @ideafood on Twitter.
This book has also made me curious about what new interpersonal behaviors this technology is creating and requiring on an individual level. How will the Internet, Social Media and Games lead to new behaviors at home work and school? What new behaviors are needed? He hints at this with his most recent book, Cognitive Surplus, which envisions could happen if people stopped watching mind-numbing TV and started doing things like write Wikipedia pages or Amazon book reviews.
And Here Comes Everybody does have interesting thoughts about business operations. Shirky says, "All businesses are media businesses, because whatever else they do, all businesses rely on managing information for two audiences -- employees and the world." He adds further, " In economic terms, capital is a store of wealth and assets; social capital is that store of behaviors and norms in any large group that lets its members support one another." Once old costs are shed, time and money can be applied to different things.
He also talks about innovation, with the value of networks as a foundation: "It's not how many people you know, it's how many kinds," and then he extols the advantages of cognitive diversity for innovation. At the same time, organizations have a difficult time innovating, because creative people are harder to manage, disruptive, and difficult to compensate, and they often don't scale well. And then there is the natural human tendency to destroy things, which Shirky believes is because destruction is easier than construction. As he says, "Anything that increases the cost of doing something reduces what gets done," and doing nothing is always easiest. The cherry on top is the personal interests and rivalries at play with regard to new ideas. Little wonder that Machiavelli advised against doing new things! Yet the world requires it more than ever.
One buried solution for innovation is simplicity. He says, "Communication tools don't become socially interesting until they become technologically boring." I love this line.
What Here Comes Everybody did not predict is that Twitter and Facebook would be used as tools to overthrow despots in Arab lands. Although Shirky did lay-out the theoretical groundwork for the multi-billion dollar valuations of Twitter, Facebook, LinkedIn, Groupon and Zenga. Now Flipboard and Zite are putting further pressure on traditional media. A lot has happened since this book came out three years ago in 2009.
It makes me wonder, "Where things will be three years from now in 2014?"
Maybe Clay Shirky will tell us on another book. In the meantime, here are some other books on the Internet worth reading:
Collective Intelligence: Mankind's Emerging World in Cyberspace (Helix Books)
The New Rules of Marketing and PR: How to Use Social Media, Blogs, News Releases, Online Video, and Viral Marketing to Reach Buyers Directly, 2nd Edition