Blue Skies

I: Cloud People

I want to open this afternoon’s talk with a story about my friend Kate Carruthers.  Kate is a business strategist, currently working at Hyro, over in Surry Hills.  In November, while on a business trip to Far North Queensland, Kate pulled out her American Express credit card to pay for a taxi fare.  Her card was declined.  Kate paid with another card and thought little of it until the next time she tried to use the card – this time to pay for something rather pricier, and more important – and found her card declined once again.

As it turned out, American Express had cut Kate’s credit line in half, but hadn’t bothered to inform her of this until perhaps a day or two before, via post.  So here’s Kate, far away from home, with a crook credit card.  Thank goodness she had another card with her, or it could have been quite a problem.  When she contacted American Express to discuss that credit line change – on a Friday evening – she discovered that this ‘consumer’ company kept banker’s hours in its credit division.  That, for Kate, was the last straw.  She began to post a series of messages to Twitter:

“I can’t believe how rude Amex have been to me; cut credit limit by 50% without notice; declined my card while in QLD even though acct paid”

“since Amex just treated me like total sh*t I just posted a chq for the balance of my account & will close acct on Monday”

“Amex is hardly accepted anywhere anyhow so I hardly use it now & after their recent treatment I’m outta there”

“luckily for me I have more than enough to just pay the sucker out & never use Amex again”

“have both a gold credit card & gold charge card with amex until monday when I plan to close both after their crap behaviour”

One after another, Kate sent this stream of messages out to her Twitter followers.  All of her Twitter followers.  Kate’s been on Twitter for a long time – well over three years – and she’s accumulated a lot of followers.  Currently, she has over 8300 followers, although at the time she had her American Express meltdown, the number was closer to 7500.

Let’s step back and examine this for a moment.  Kate is, in most respects, a perfectly ordinary (though whip-smart) human being.  Yet she now has this ‘cloud’ of connections, all around her, all the time, through Twitter.  These 8300 people are at least vaguely aware of whatever she chooses to share in her tweets.  They care enough to listen, even if they are not always listening very closely.  A smaller number of individuals (perhaps a few hundred, people like me) listen more closely.  Nearly all the time we’re near a computer or a mobile, we keep an eye on Kate.  (Not that she needs it.  She’s thoroughly grown up.  But if she ever got into a spot of trouble or needed a bit of help, we’d be on it immediately.)

This kind of connectivity is unprecedented in human history.  We came from villages where perhaps a hundred of us lived close enough together that there were no secrets.  We moved to cities where the power of numbers gave us all a degree of anonymity, but atomized us into disconnected individuals, lacking the social support of a community.  Now we come full circle.  This is the realization of the ‘Global Village’ that Marshall McLuhan talked about fifty years ago.  At the time McLuhan though of television as a retribalizing force.  It wasn’t.  But Facebook and Twitter and the mobiles each of us carry with us during all our waking hours?  These are the new retribalizing forces, because they keep us continuously connected with one another, allowing us to manage connections in every-greater numbers.

Anything Kate says, no matter how mundane, is now widely known.  But it’s more than that.  Twitter is text, but it is also links that can point to images, or videos, or songs, or whatever you can digitize and upload to the Web.  Kate need simply drop a URL into a tweet and suddenly nearly ten thousand people are aware of it.  If they like it, they will send it along (‘re-tweet’ is the technical term), and it will spread out quickly, like waves on a pond.

But Twitter isn’t a one-way street.  Kate is ‘following’ 7250 individuals; that is, she’s receiving tweets from them.  That sounds like a nearly impossible task: how can you pay attention to what that many people have to say?  It’d be like trying to listen to every conversation at Central Station (or Flinders Street Station) at peak hour.  Madness.  And yet, it is possible.  Tools have been created that allow you to keep a pulse on the madness, to stick a toe into the raging torrent of commentary.

Why would you want to do this?  It’s not something that you need to do (or even want to do) all the time, but there are particular moments – crisis times – when Twitter becomes something else altogether.  After an earthquake or other great natural disaster, after some pivotal (or trivial) political event, after some stunning discovery.  The 5650 people I follow are my connection to all of that.  My connection is broad enough that someone, somewhere in my network is nearly always nearly the first to know something, among the first to share what they know.  Which means that I too, if I am paying attention, am among the first to know.

Businesses have been built on this kind of access.  An entire sector of the financial services industry, from DowJones to Bloomberg, has thrived because it provides subscribers with information before others have it – information that can be used on a trading floor.  This kind of information freely comes to the very well-connected.  This kind of information can be put to work to make you more successful as an individual, in your business, or in whatever hobbies you might pursue.  And it’s always there.  All you need do is plug into it.

When you do plug into it, once you’ve gotten over the initial confusion, and you’ve dedicated the proper time and tending to your network, so that it grows organically and enthusiastically, you will find yourself with something amazingly flexible and powerful.  Case in point: in December I found myself in Canberra for a few days.  Where to eat dinner in a town that shuts down at 5 pm?  I asked Twitter, and forty-five minutes later I was enjoying some of the best seafood laksa I’ve had in Australia.  A few days later, in the Barossa, I asked Twitter which wineries I should visit – and the top five recommendations were very good indeed.  These may seem like trivial instances – though they’re the difference between a good holiday and a lackluster one – but what they demonstrate is that Twitter has allowed me to plug into all of the expertise of all of the thousands of people I am connected to.  Human brainpower, multiplied by 5650 makes me smarter, faster, and much, much more effective.  Why would I want to live any other way?  Twitter can be inane, it can be annoying, it can be profane and confusing and chaotic, but I can’t imagine life without it, just as I can’t imagine life without the Web or without my mobile.  The idea that I am continuously connected and listening to a vast number of other people – even as they listen to me – has gone from shocking to comfortable in just over three years.

Kate and I are just the leading edge.  Where we have gone, all of the rest of you will soon follow.  We are all building up our networks, one person at a time.  A child born in 2010 will spend their lifetime building up a social network.  They’ll never lose track of any individual they meet and establish a connection with.  That connection will persist unless purposely destroyed.  Think of the number of people you meet throughout your lives, who you establish some connection with, even if only for a few hours.  That number would easily reach into the thousands for every one of us.  Kate and I are not freaks, we’re simply using the bleeding edge of a technology that will be almost invisible and not really worth mentioning by 2020.

All of this means that the network is even more alluring than it was a few years ago, and will become ever more alluring with the explosive growth in social networks.  We are just at the beginning of learning how to use these new social networks.  First we kept track of friends and family.  Then we moved on to business associates.  Now we’re using them to learn, to train ourselves and train others, to explore, to explain, to help and to ask for help.  They are becoming a new social fabric which will knit us together into an unfamiliar closeness.  This is already creating some interesting frictions for us.  We like being connected, but we also treasure the moments when we disconnect, when we can’t be reached, when our time and our thoughts are our own.  We preach focus to our children, but find our time and attention increasing divided by devices that demand service: email, Web, phone calls, texts, Twitter, Facebook, all of it brand new, and all of it seemingly so important that if we ignore any of them we immediately feel the cost.  I love getting away from it all.  I hate the backlog of email that greets me when I return.  Connecting comes with a cost.  But it’s becoming increasingly impossible to imagine life without it.

II: Eyjafjallajökull

I recently read a most interesting blog postChase Saunders, a software architect and entrepreneur in Maine (not too far from where I was born) had a bit of a brainwave and decided to share it with the rest of the world.  But you may not like it.  Saunders begins with: “For me to get really mad at a company, it takes more than a lousy product or service: it’s the powerlessness I feel when customer service won’t even try to make things right.  This happens to me about once a year.”  Given the number of businesses we all interact with in any given year – both as consumers and as client businesses – this figure is far from unusual.  There will be times when we get poor value for money, or poor service, or a poor response time, or what have you.  The world is a cruel place.  It’s what happens after that cruelty which is important: how does the business deal with an upset customer?  If they fail the upset customer, that’s when problems can really get out of control.

In times past, an upset customer could cancel their account, taking their business elsewhere.  Bad, but recoverable.  These days, however, customers have more capability, precisely because of their connectivity.  And this is where things start to go decidedly pear-shaped.  Saunders gets to the core of his idea:

Let’s say you buy a defective part from ACME Widgets, Inc. and they refuse to refund or replace it.  You’re mad, and you want the world to know about this awful widget.  So you pop over to AdRevenge and you pay them a small amount. Say $3.  If the company is handing out bad widgets, maybe some other people have already done this… we’ll suppose that before you got there, one guy donated $1 and another lady also donated $1.  So now we have 3 people who have paid a total of $5 to warn other potential customers about this sketchy company…the 3 vengeful donations will go to the purchase of negative search engine advertising.  The ads are automatically booked and purchased by the website…

And there it is.  Your customers – your angry customers – have found an effective way to band together and warn every other potential customer just how badly you suck, and will do it every time your name gets typed into a search engine box.  And they’ll do it whether or not their complaints are justified.  In fact, your competitors could even game the system, stuffing it up with lots of false complaints.  It will quickly become complete, ugly chaos.

You’re probably all donning your legal hats, and thinking about words like ‘libel’ and ‘defamation’.  Put all of that out of your mind.  The Internet is extraterritorial, it and effectively ungovernable, despite all of the neat attempts of governments from China to Iran to Australia to stuff it back into some sort of box.  Ban AdRevenge somewhere, it pops up somewhere else – just as long as there’s a demand for it.  Other countries – perhaps Iceland or Sweden, and certainly the United States – don’t have the same libel laws as Australia, yet their bits freely enter the nation over the Internet.  There is no way to stop AdRevenge or something very much like AdRevenge from happening.  No way at all.  Resign yourself to this, and embrace it, because until you do you won’t be able to move on, into a new type of relationship with your customers.

Which brings us back to our beginning, and a very angry Kate Carruthers.  Here she is, on a Friday night in Far North Queensland, spilling quite a bit of bile out onto Twitter.  Everyone one of the 7500 people who read her tweets will bear her experience in mind the next time they decide whether they will do any business with American Express.  This is damage, probably great damage to the reputation of American Express, damage that could have been avoided, or at least remediated before Kate ‘went nuclear’.

But where was American Express when all of this was going on?  While Kate expressed her extreme dissatisfaction with American Express, its own marketing arm was busily cooking up a scheme to harness Twitter.  It’s Open Forum Pulse website shows you tweets from small businesses around the world.  Ironic, isn’t it? American Express builds a website to show us what others are saying on Twitter, all the while ignoring about what’s being said about it.  So the fire rages, uncontrolled, while American Express fiddles.

There are other examples.  On Twitter, one of my friends lauded the new VAustralia Premium Economy service to the skies, while VAustralia ran some silly marketing campaign that had four blokes sending three thousand tweets over two days in Los Angeles.  Sure, I want to tune into that stream of dreck and drivel.  That’s exactly what I’m looking for in the age of information overload: more crap.

This is it, the fundamental disconnect, the very heart of the matter.  We all need to do a whole lot less talking, and a whole lot more listening.  That’s true for each of us as individuals: we’re so well-connected now that by the time we do grow into a few thousand connections we’d be wiser listening than speaking, most of the time.  But this is particularly true for businesses, which make their living dealing with customers.  The relationship between businesses and their customers has historically been characterized by a ‘throw it over the wall’ attitude.  There is no wall, anywhere.  The customer is sitting right beside you, with a megaphone pointed squarely into your ear.

If we were military planners, we’d call this ‘asymmetric warfare’.  Instead, we should just give it the name it rightfully deserves: 21st-century business.  It’s a battlefield out there, but if you come prepared for a 20th-century conflict – massive armies and big guns – you’ll be overrun by the fleet-footed and omnipresent guerilla warfare your customers will wage against you – if you don’t listen to them.  Like volcanic ash, it may not present a solid wall to prevent your progress.  But it will jam up your engines, and stop you from getting off the ground.

Listening is not a job.  There will be no ‘Chief Listening Officer’, charged with keeping their ear down to the ground, wondering if the natives are becoming restless, ready to sound the alarm when a situation threatens to go nuclear.  There is simply too much to listen to, happening everywhere, all at once.  Any single point which presumed to do the listening for an entire organization – whether an individual or a department – will simply be overwhelmed, drowning in the flow of data.  Listening is not a job: it is an attitude.  Every employee from the most recently hired through to the Chief Executive must learn to listen.  Listen to what is being said internally (therein lies the path to true business success) and learn to listen to what others, outside the boundaries of the organization, are saying about you.

Employees already regularly check into their various social networks.  Right now we think of that as ‘slacking off’, not something that we classify as work.  But if we stretch the definition just a bit, and begin to recognize that the organization we work for is, itself, part of our social network, things become clearer.  Someone can legitimately spend time on Facebook, looking for and responding to issues as they arise.  Someone can be plugged into Twitter, giving it continuous partial attention all day long, monitoring and soothing customer relationships.  And not just someone.  Everyone.  This is a shared responsibility.  Working for the organization means being involved with and connected to the organization’s customers, past, present and future.  Without that connection, problems will inevitably arise, will inevitably amplify, will inevitably result in ‘nuclear events’.  Any organization (or government, or religion) can only withstand so many nuclear events before it begins to disintegrate.  So this isn’t a matter of choice.  This is a basic defensive posture.  An insurance policy, of sorts, protecting you against those you have no choice but to do business with.

Yet this is not all about defense.  Listening creates opportunity.  I get some of my best ideas – such as that AdRevenge article – because I am constantly listening to others’ good ideas.  Your customers might grumble, but they also praise you for a job well done.  That positive relationship should be honored – and reinforced.  As you reinforce the positive, you create a virtuous cycle of interactions which becomes terrifically difficult to disrupt.  When that’s gone on long enough, and broadly enough, you have effectively raised up your own army – in the post-modern, guerilla sense of the word – who will go out there and fight for you and your brand when the haters and trolls and chaos-makers bear down upon you.  These people are connected to you, and will connect to one another because of the passion they share around your products and your business.  This is another network, an important network, an offensive network, and you need both defensive and offensive strategies to succeed on this playing field.

Just as we as individuals are growing into hyperconnectivity, so our businesses must inevitably follow.  Hyperconnected individuals working with disconnected businesses is a perfect recipe for confusion and disaster.  Like must meet with like before the real business of the 21st-century can begin.

III: Services With a Smile

Moving from the abstract to the concrete, let’s consider the types of products and services required in our densely hyperconnected world.  First and foremost, we are growing into a pressing, almost fanatical need for continuous connectivity.  Wherever we are – even in airplanes – we must be connected.  The quality of that connection – its speed, reliability, and cost – are important co-factors to consider, and it is not always the cheapest connection which serves the customer best.  I pay a premium for my broadband connection because I can send the CEO of my ISP a text any time my link goes down – and my trouble tickets are sorted very rapidly!  Conversely, I went with a lower-cost carrier for my mobile service, and I am paying the price, with missed calls, failed data connections, and crashes on my iPhone.

As connectivity becomes more important, reliability crowds out other factors.  You can offer a premium quality service at a premium price and people will adopt it, for the same reason they will pay more for a reliable car, or for electricity from a reliable supplier, or for food that they’re sure will be wholesome.  Connectivity has become too vital to threaten.  This means there’s room for healthy competition, as providers offer different levels of service at different price points, competing on quality, so that everyone gets the level of service they can afford.  But uptime always will be paramount.

What service, exactly is on offer?  Connectivity comes in at least two flavors: mobile and broadband.  These are not mutually exclusive.  When we’re stationary we use broadband; when we’re in motion we use mobile services.  The transition between these two networks should be invisible and seamless as possible – as pioneered by Apple’s iPhone.

At home, in the office, at the café or library, in fact, in almost any structure, customers should have access to wireless broadband.  This is one area where Australia noticeably trails the rest of the world.  The tariff structure for Internet traffic has led Australians to be unusually conservative with their bits, because there is a specific cost incurred for each bit sent or received.  While this means that ISPs should always have the funding to build out their networks to handle increases in capacity, it has also meant that users protect their networks from use in order to keep costs down.  This fundamental dilemma has subjected wireless broadband in Australia to a subtle strangulation.  We do not have the ubiquitous free wireless access that many other countries – in particular, the United States – have on offer, and this consequently alters our imagination of the possibilities for ubiquitous networking.

Tariffs are now low enough that customers ought to be encouraged to offer wireless networking to the broader public.  There are some security concerns that need to be addressed to make this safe for all parties, but these are easily dealt with.  There is no fundamental barrier to pervasive wireless broadband.  It does not compete with mobile data services.  Rather, as wireless broadband becomes more ubiquitous, people come to rely on continuous connectivity ever more.  Mobile data demand will grow in lockstep as more wireless broadband is offered.  Investment in wireless broadband is the best way to ensure that mobile data services continue to grow.

Mobile data services are best characterized principally by speed and availability.  Beyond a certain point – perhaps a megabit per second – speed is not an overwhelming lure on a mobile handset.  It’s nice but not necessary.  At that point, it’s much more about provisioning: how will my carrier handle peak hour in Flinders Street Station (or Central Station)?  Will my calls drop?  Will I be able to access my cloud-based calendar so that I can grab a map and a phone number to make dinner reservations?  If a customer finds themselves continually frustrated in these activities, one of two things will happen: either the mobile will go back into the pocket, more or less permanently, or the customer will change carriers.  Since the customer’s family, friends and business associates will not be putting their own mobiles back into their pockets, it is unlikely that any customer will do so for any length of time, irrespective of the quality of their mobile service.  If the carrier will not provision, the customers must go elsewhere.

Provisioning is expensive.  But it is also the only sure way to retain your customers.  A customer will put up with poor customer service if they know they have reliable service.  A customer will put up with a higher monthly spend if they have a service they know they can depend upon in all circumstances.  And a customer will quickly leave a carrier who can not be relied upon.  I’ve learned that lesson myself.  Expect it to be repeated, millions of times over, in the years to come, as carriers, regrettably and avoidably, find that their provisioning is inadequate to support their customers.

Wireless is wonderful, and we think of it as a maintenance-free technology, at least from the customer’s point of view.  Yet this is rarely so.  Last month I listened to a talk by Genevieve Bell, Intel Fellow and Lead Anthropologist at the chipmaker.  Her job is to spend time in the field – across Europe and the developing world – observing  how people really use technology when it escapes into the wild.  Several years ago she spent some time in Singapore, studying how pervasive wireless broadband works in the dense urban landscape of the city-state.  In any of Singapore’s apartment towers – which are everywhere – nearly everyone has access to very high speed wired broadband (perhaps 50 megabits per second) – which is then connected to a wireless router to distribute the broadband throughout the apartment.  But wireless is no great respecter of walls.  Even in my own flat in Surry Hills I can see nine wireless networks from my laptop, including my own.  In a Singapore tower block, the number is probably nearer to twenty or thirty.

Genevieve visited a family who had recently purchased a wireless printer.  They were dissatisfied with it, pronouncing it ‘possessed’.  What do you mean? she inquired.  Well, they explained, it doesn’t print what they tell it to print.  But it does print other things.  Things they never asked for.  The family called for a grandfather to come over and practice his arts of feng shui, hoping to rid the printer of its evil spirits.  The printer, now repositioned to a more auspicious spot, still misbehaved.  A few days later, a knock came on the door.  Outside stood a neighbor, a sheaf of paper in his hands, saying, “I believe these are yours…?”

The neighbor had also recently purchased a wireless printer, and it seems that these two printers had automatically registered themselves on each other’s networks.  Automatic configuration makes wireless networks a pleasure to use, but it also makes for botched configurations and flaky communication.  Most of this is so far outside the skill set of the average consumer that these problems will never be properly remedied.  The customer might make a support call, and maybe – just maybe the problem will be solved.  Or, the problem will persist, and the customer will simply give up.  Even with a support call, wireless networks are often so complex that the problem can’t be wholly solved.

As wireless networks grow more pervasive, Genevieve Bell recommends that providers offer a high-quality hand-holding and diagnostic service to their customers.  They need to offer a ‘tune up’ service that will travel to the customer once a year to make sure everything is running well.  Consumers need to be educated that wireless networks do not come for free.  Like anything else, they require maintenance, and the consumer should come to expect that it will cost them something, every year, to keep it all up and running.  In this, a wireless network is no different than a swimming pool or a lawn.  There is a future for this kind of service: if you don’t offer it, your competitors soon will.

Finally, let me close with what the world looks like when all of these services are working perfectly.  Lately, I’ve become a big fan of Foursquare, a ‘location-based social network’.  Using the GPS on my iPhone, Foursquare allows me to ‘check in’ when I go to a restaurant, a store, or almost anywhere else.  Once I’ve checked in, I can make a recommendation – a ‘tip’ in Foursquare lingo – or simply look through the tips provided by those who have been there before me.  This list of tips is quickly growing longer, more substantial, and more useful.  I can walk into a bar that I’ve never been to before and know exactly which cocktail I want to order.  I know which table at the restaurant offers the quietest corner for a romantic date.  I know which salesperson to talk to for a good deal on that mobile handset.  And so on.  I have immediate and continuous information in depth, and I put that information to work, right now, to make my life better.

The world of hyperconnectivity isn’t some hypothetical place we’ll never see.  We are living in it now.  The seeds of the future are planted in the present.  But the shape of the future is determined by our actions today.  It is possible to blunt and slow Australia’s progress into this world with bad decisions and bad services.  But it is also possible to thrust the nation into global leadership if we can embrace the inevitable trend toward hyperconnectivity, and harness it.  It has already transformed our lives.  It will transform our businesses, our schools, and our government.  You are the carriers of that change.  Your actions will bring this new world into being.

Digital Citizenship

Introduction: Out of Control

A spectre is haunting the classroom, the spectre of change. Nearly a century of institutional forms, initiated at the height of the Industrial Era, will change irrevocably over the next decade. The change is already well underway, but this change is not being led by teachers, administrators, parents or politicians. Coming from the ground up, the true agents of change are the students within the educational system. Within just the last five years, both power and control have swung so quickly and so completely in their favor that it’s all any of us can do to keep up. We live in an interregnum, between the shift in power and its full actualization: These wacky kids don’t yet realize how powerful they are.

This power shift does not have a single cause, nor could it be thwarted through any single change, to set the clock back to a more stable time. Instead, we are all participating in a broadly-based cultural transformation. The forces unleashed can not simply be dammed up; thus far they have swept aside every attempt to contain them. While some may be content to sit on the sidelines and wait until this cultural reorganization plays itself out, as educators you have no such luxury. Everything hits you first, and with full force. You are embedded within this change, as much so as this generation of students.

This paper outlines the basic features of this new world we are hurtling towards, pointing out the obvious rocks and shoals that we must avoid being thrown up against, collisions which could dash us to bits. It is a world where even the illusion of control has been torn away from us. A world wherein the first thing we need to recognize that what is called for in the classroom is a strategic détente, a détente based on mutual interest and respect. Without those two core qualities we have nothing, and chaos will drown all our hopes for worthwhile outcomes. These outcomes are not hard to achieve; one might say that any classroom which lacks mutual respect and interest is inevitably doomed to failure, no matter what the tenor of the times. But just now, in this time, it happens altogether more quickly.

Hence I come to the title of this talk, “Digital Citizenship”. We have given our children the Bomb, and they can – if they so choose – use it to wipe out life as we know it. Right now we sit uneasily in an era of mutually-assured destruction, all the more dangerous because these kids don’t now how fully empowered they are. They could pull the pin by accident. For this reason we must understand them, study them intently, like anthropologists doing field research with an undiscovered tribe. They are not the same as us. Unwittingly, we have changed the rules of the world for them. When the Superpowers stared each other down during the Cold War, each was comforted by the fact that each knew the other had essentially the same hopes and concerns underneath the patina of Capitalism or Communism. This time around, in this Cold War, we stare into eyes so alien they could be another form of life entirely. And this, I must repeat, is entirely our own doing. We have created the cultural preconditions for this Balance of Terror. It is up to us to create an environment that fosters respect, trust, and a new balance of powers. To do that first we must examine the nature of the tremendous changes which have fundamentally altered the way children think.

I: Primary Influences

I am a constructivist. Constructivism states (in terms that now seem fairly obvious) that children learn the rules of the world from their repeated interactions within in. Children build schema, which are then put to the test through experiment; if these experiments succeed, those schema are incorporated into ever-larger schema, but if they fail, it’s back to the drawing board to create new schema. This all seems straightforward enough – even though Einstein pronounced it, “An idea so simple only a genius could have thought of it.” That genius, Jean Piaget, remains an overarching influence across the entire field of childhood development.

At the end of the last decade I became intensely aware that the rapid technological transformations of the past generation must necessarily impact upon the world views of children. At just the time my ideas were gestating, I was privileged to attend a presentation given by Sherry Turkle, a professor at the Massachusetts Institute of Technology, and perhaps the most subtle thinker in the area of children and technology. Turkle talked about her current research, which involved a recently-released and fantastically popular children’s toy, the Furby.

For those of you who may have missed the craze, the Furby is an animatronic creature which has expressive eyes, touch sensors, and a modest capability with language. When first powered up, the Furby speaks ‘Furbish’, an artificial language which the child can decode by looking up words in a dictionary booklet included in the package. As the child interacts with the toy, the Furby’s language slowly adopts more and more English prhases. All of this is interesting enough, but more interesting, by far, is that the Furby has needs. Furby must be fed and played with. Furby must rest and sleep after a session of play. All of this gives the Furby some attributes normally associated with living things, and this gave Turkle an idea.

Constructivists had already determined that between ages four and six children learn to differentiate between animate objects, such as a pet dog, and inanimate objects, such as a doll. Since Furby showed qualities which placed it into both ontological categories, Turkle wondered whether children would class it as animate or inanimate. What she discovered during her interviews with these children astounded her. When the question was put to them of whether the Furby was animate or inanimate, the children said, “Neither.” The children intuited that the Furby resided in a new ontological class of objects, between the animate and inanimate. It’s exactly this ontological in-between-ness of Furby which causes some adults to find them “creepy”. We don’t have a convenient slot to place them into our own world views, and therefore reject them as alien. But Furby was completely natural to these children. Even the invention of a new ontological class of being-ness didn’t strain their understanding. It was, to them, simply the way the world works.

Writ large, the Furby tells the story of our entire civilization. We make much of the difference between “digital immigrants”, such as ourselves, and “digital natives”, such as these children. These kids are entirely comfortable within the digital world, having never known anything else. We casually assume that this difference is merely a quantitative facility. In fact, the difference is almost entirely qualitative. The schema upon which their world-views are based, the literal ‘rules of their world’, are completely different. Furby has an interiority hitherto only ascribed to living things, and while it may not make the full measure of a living thing, it is nevertheless somewhere on a spectrum that simply did not exist a generation ago. It is a magical object, sprinkled with the pixie dust of interactivity, come partially to life, and closer to a real-world Pinocchio than we adults would care to acknowledge.

If Furby were the only example of this transformation of the material world, we would be able to easily cope with the changes in the way children think. It was, instead, part of a leading edge of a breadth of transformation. For example, when I was growing up, LEGO bricks were simple, inanimate objects which could be assembled in an infinite arrangement of forms. Today, LEGO Mindstorms allow children to create programmable forms, using wheels and gears and belts and motors and sensors. LEGO is no longer passive, but active and capable of interacting with the child. It, too, has acquired an interiority which teaches children that at some essential level the entire material world is poised at the threshold of a transformation into the active. A child playing with LEGO Mindstorms will never see the material world as wholly inanimate; they will see it as a playground requiring little more than a few simple mechanical additions, plus a sprinkling of code, to bring it to life. Furby adds interiority to the inanimate world, but LEGO Mindstorms empowers the child with the ability to add this interiority themselves.

The most significant of these transformational innovations is one of the most recent. In 2004, Google purchased Keyhole, Inc., a company that specialized in geospatial data visualization tools. A year later Google released the first version of Google Earth, a tool which provides a desktop environment wherein the entire Earth’s surface can be browsed, at varying levels of resolution, from high Earth orbit, down to the level of storefronts, anywhere throughout the world. This tool, both free and flexible, has fomented a revolution in the teaching of geography, history and political science. No longer constrained to the archaic Mercator Projection atlas on the wall, or the static globe-as-a-ball perched on one corner of teacher’s desk, Google Earth presents Earth-as-a-snapshot.

We must step back and ask ourselves the qualitative lesson, the constructivist message of Google Earth. Certainly it removes the problem of scale; the child can see the world from any point of view, even multiple points of view simultaneously. But it also teaches them that ‘to observe is to understand’. A child can view the ever-expanding drying of southern Australia along with a data showing the rise in temperature over the past decade, all laid out across the continent. The Earth becomes a chalkboard, a spreadsheet, a presentation medium, where the thorny problems of global civilization and its discontents can be explored out in exquisite detail. In this sense, no problem, no matter how vast, no matter how global, will be seen as being beyond the reach of these children. They’ll learn this – not because of what teacher says, or what homework assignments they complete – through interaction with the technology itself.

The generation of children raised on Google Earth will graduate from secondary schools in 2017, just at the time the Government plans to complete its rollout of the National Broadband Network. I reckon these two tools will go hand-in-hand: broadband connects the home to the world, while Google Earth brings the world into the home. Australians, particularly beset by the problems of global warming, climate, and environmental management, need the best tools and the best minds to solve the problems which already beset us. Fortunately it looks as though we are training a generation for leadership, using the tools already at hand.

The existence of Google Earth as an interactive object changes the child’s relationship to the planet. A simulation of Earth is a profoundly new thing, and naturally is generating new ontological categories. Yet again, and completely by accident, we have profoundly altered the world view of this generation of children and young adults. We are doing this to ourselves: our industries turn out products and toys and games which apply the latest technological developments in a dazzling variety of ways. We give these objects to our children, more or less blindly unaware of how this will affect their development. Then we wonder how these aliens arrived in our midst, these ‘digital natives’ with their curious ways. Ladies and gentlemen, we need to admit that we have done this to ourselves. We and our technological-materialist culture have fostered an environment of such tremendous novelty and variety that we have changed the equations of childhood.

Yet these technologies are only the tip of the iceberg. Each are the technologies of childhood, of a world of objects, where the relationship is between child and object. This is not the world of adults, where the relations between objects are thoroughly confused by the relationships between adults. In fact, it can be said that for as much as adults are obsessed with material possessions, we are only obsessed with them because of our relationships to other adults. The corner we turn between childhood and young adulthood is indicative of a change in the way we think, in the objects of attention, and in the technologies which facilitate and amplify that attention. These technologies have also suddenly and profoundly changed, and, again, we are almost completely unaware of what that has done to those wacky kids.

II: Share This Thought!

Australia now has more mobile phone subscribers than people. We have reached 104% subscription levels, simply because some of us own and use more than one handset. This phenomenon has been repeated globally; there are something like four billion mobile phone subscribers throughout the world, representing approximately three point six billion customers. That’s well over half the population of planet Earth. Given that there are only about a billion people in the ‘advanced’ economies in the developed world – almost all of whom now use mobiles – two and a half billion of the relatively ‘poor’ also have mobiles. How could this be? Shouldn’t these people be spending money on food, housing, and education for their children?

As it turns out (and there are numerous examples to support this) a mobile handset is probably the most important tool someone can employ to improve their economic well-being. A farmer can call ahead to markets to find out which is paying the best price for his crop; the same goes for fishermen. Tradesmen can close deals without the hassle and lost time involved in travel; craftswomen can coordinate their creative resources with a few text messages. Each of these examples can be found in any Bangladeshi city or Africa village. In the developed world, the mobile was nice but non-essential: no one is late anymore, just delayed, because we can always phone ahead. In the parts of the world which never had wired communications, the leap into the network has been explosively potent.

The mobile is a social accelerant; it does for our innate social capabilities what the steam shovel did for our mechanical capabilities two hundred years ago. The mobile extends our social reach, and deepens our social connectivity. Nowhere is this more noticeable than in the lives of those wacky kids. At the beginning of this decade, researcher Mitzuko Ito took a look at the mobile phone in the lives of Japanese teenagers. Ito published her research in Personal, Portable, Pedestrian: Mobile Phones in Japanese Life, presenting a surprising result: these teenagers were sending and receiving a hundred text messages a day among a close-knit group of friends (generally four or five others), starting when they first arose in the morning, and going on until they fell asleep at night. This constant, gentle connectivity – which Ito named ‘co-presence’ – often consisted of little of substance, just reminders of connection.

At the time many of Ito’s readers dismissed this phenomenon as something to be found among those ‘wacky Japanese’, with their technophilic bent. A decade later this co-presence is the standard behavior for all teenagers everywhere in the developed world. An Australian teenager thinks nothing of sending and receiving a hundred text messages a day, within their own close group of friends. A parent who might dare to look at the message log on a teenager’s phone would see very little of significance and wonder why these messages needed to be sent at all. But the content doesn’t matter: connection is the significant factor.

We now know that the teenage years are when the brain ‘boots’ into its full social awareness, when children leave childhood behind to become fully participating members within the richness of human society. This process has always been painful and awkward, but just now, with the addition of the social accelerant and amplifier of the mobile, it has become almost impossibly significant. The co-present social network can help cushion the blow of rejection, or it can impel the teenager to greater acts of folly. Both sides of the technology-as-amplifier are ever-present. We have seen bullying by mobile and over YouTube or Facebook; we know how quickly the technology can overrun any of the natural instincts which might prevent us from causing damage far beyond our intention – keep this in mind, because we’ll come back to it when we discuss digital citizenship in detail.

There is another side to sociability, both far removed from this bullying behavior and intimately related to it – the desire to share. The sharing of information is an innate human behavior: since we learned to speak we’ve been talking to each other, warning each other of dangers, informing each other of opportunities, positing possibilities, and just generally reassuring each other with the sound of our voices. We’ve now extended that four-billion-fold, so that half of humanity is directly connected, one to another.

We know we say little to nothing with those we know well, though we may say it continuously. What do we say to those we know not at all? In this case we share not words but the artifacts of culture. We share a song, or a video clip, or a link, or a photograph. Each of these are just as important as words spoken, but each of these places us at a comfortable distance within the intimate act of sharing. 21st-century culture looks like a gigantic act of sharing. We share music, movies and television programmes, driving the creative industries to distraction – particularly with the younger generation, who see no need to pay for any cultural product. We share information and knowledge, creating a wealth of blogs, and resources such as Wikipedia, the universal repository of factual information about the world as it is. We share the minutiae of our lives in micro-blogging services such as Twitter, and find that, being so well connected, we can also harvest the knowledge of our networks to become ever-better informed, and ever more effective individuals. We can translate that effectiveness into action, and become potent forces for change.

Everything we do, both within and outside the classroom, must be seen through this prism of sharing. Teenagers log onto video chat services such as Skype, and do their homework together, at a distance, sharing and comparing their results. Parents offer up their kindergartener’s presentations to other parents through Twitter – and those parents respond to the offer. All of this both amplifies and undermines the classroom. The classroom has not dealt with the phenomenal transformation in the connectivity of the broader culture, and is in danger of becoming obsolesced by it.

Yet if the classroom were to wholeheartedly to embrace connectivity, what would become of it? Would it simply dissolve into a chaotic sea, or is it strong enough to chart its own course in this new world? This same question confronts every institution, of every size. It affects the classroom first simply because the networked and co-present polity of hyperconnected teenagers has reached it first. It is the first institution that must transform because the young adults who are its reason for being are the agents of that transformation. There’s no way around it, no way to set the clock back to a simpler time, unless, Amish-like, we were simply to dispose of all the gadgets which we have adopted as essential elements in our lifestyle.

This, then, is why these children hold the future of the classroom-as-institution in their hands, this is why the power-shift has been so sudden and so complete. This is why digital citizenship isn’t simply an academic interest, but a clear and present problem which must be addressed, broadly and immediately, throughout our entire educational system. We already live in a time of disconnect, where the classroom has stopped reflecting the world outside its walls. The classroom is born of an industrial mode of thinking, where hierarchy and reproducibility were the order of the day. The world outside those walls is networked and highly heterogeneous. And where the classroom touches the world outside, sparks fly; the classroom can’t handle the currents generated by the culture of connectivity and sharing. This can not go on.

When discussing digital citizenship, we must first look to ourselves. This is more than a question of learning the language and tools of the digital era, we must take the life-skills we have already gained outside the classroom and bring them within. But beyond this, we must relentlessly apply network logic to the work of our own lives. If that work is as educators, so be it. We must accept the reality of the 21st century, that, more than anything else, this is the networked era, and that this network has gifted us with new capabilities even as it presents us with new dangers. Both gifts and dangers are issues of potency; the network has made us incredibly powerful. The network is smarter, faster and more agile than the hierarchy; when the two collide – as they’re bound to, with increasing frequency – the network always wins. A text message can unleash revolution, or land a teenager in jail on charges of peddling child pornography, or spark a riot on a Sydney beach; Wikipedia can drive Britannica, a quarter millennium-old reference text out of business; a outsider candidate can get himself elected president of the United States because his team masters the logic of the network. In truth, we already live in the age of digital citizenship, but so many of us don’t know the rules, and hence, are poor citizens.

Now that we’ve explored the dimensions of the transition in the understanding of the younger generation, and the desynchronization of our own practice within the world as it exists, we can finally tackle the issue of digital citizenship. Children and young adults who have grown up in this brave new world, who have already created new ontological categories to frame it in their understanding, won’t have time or attention for preaching and screeching from the pulpit in the classroom, or the ‘bully pulpits’ of the media. In some ways, their understanding already surpasses ours, but their apprehension of consequential behavior does not. It is entirely up to us to bridge this gap in their understanding, but I do not to imply that educators can handle this task alone. All of the adult forces of the culture must be involved: parents, caretakers, educators, administrators, mentors, authority and institutional figures of all kinds. We must all be pulling in the same direction, lest the threads we are trying to weave together unravel.

III: 20/60 Foresight

While on a lecture tour last year, a Queensland teacher said something quite profound to me. “Giving a year 7 student a laptop is the equivalent of giving them a loaded gun.” Just as we wouldn’t think of giving this child a gun without extensive safety instruction, we can’t even think consider giving this child a computer – and access to the network – without extensive training in digital citizenship. But the laptop is only one device; any networked device has the potential for the same pitfalls.

Long before Sherry Turkle explored Furby’s effect on the world-view of children, she examined how children interact with computers. In her first survey, The Second Self: Computers and the Human Spirit, she applied Lacanian psychoanalysis and constructivism to build a model of how children interacted with computers. In the earliest days of the personal computer revolution, these machines were not connected to any networks, but were instead laboratories where the child could explore themselves, creating a ‘mirror’ of their own understanding.

Now that almost every computer is fully connected to the billion-plus regular users of the Internet, the mirror no longer reflects the self, but the collective yet highly heterogeneous tastes and behaviors of mankind. The opportunity for quiet self-exploration drowns amidst the clamor from a very vital human world. In the space between the singular and the collective, we must provide an opportunity for children to grow into a sense of themselves, their capabilities, and their responsibilities. This liminal moment is the space for an education in digital citizenship. It may be the only space available for such an education, before the lure of the network sets behavioral patterns in place.

Children must be raised to have a healthy respect for the network from their earliest awareness of it. The network access of young children is generally closely supervised, but, as they turn the corner into tweenage and secondary education, we need to provide another level of support, which fully briefs these rapidly maturing children on the dangers, pitfalls, opportunities and strengths of network culture. They already know how to do things, but they do not have the wisdom to decide when it appropriate to do them, and when it is appropriate to refrain. That wisdom is the core of what must be passed along. But wisdom is hard to transmit in words; it must flow from actions and lessons learned. Is it possible to develop a lesson plan which imparts the lessons of digital citizenship? Can we teach these children to tame their new powers?

Before a child is given their own mobile – something that happens around age 12 here in Australia, though that is slowly dropping – they must learn the right way to use it. Not the perfunctory ‘this is not a toy’ talk they might receive from a parent, but a more subtle and profound exploration of what it means to be directly connected to half of humanity, and how, should that connectivity go awry, it could seriously affect someone’s life – possibly even their own. Yes, the younger generation has different values where the privacy of personal information is concerned, but even they have limits they want to respect, and circles of intimacy they want to defend. Showing them how to reinforce their privacy with technology is a good place to start in any discussion of digital citizenship.

Similarly, before a child is given a computer – either at home or in school – it must be accompanied by instruction in the power of the network. A child may have a natural facility with the network without having any sense of the power of the network as an amplifier of capability. It’s that disconnect which digital citizenship must bridge.

It’s not my role to be prescriptive. I’m not going to tell you to do this or that particular thing, or outline a five-step plan to ensure that the next generation avoid ruining their lives as they come online. This is a collective problem which calls for a collective solution. Fortunately, we live in an era of collective technology. It is possible for all of us to come together and collaborate on solutions to this problem. Digital citizenship is a issue which has global reach; the UK and the US are both confronting similar issues, and both, like Australia, fail to deal with them comprehensively. Perhaps the Australian College of Educators can act as a spearhead on this issue, working in concert with other national bodies to develop a program and curriculum in digital citizenship. It would be a project worthy of your next fifty years.

In closing, let’s cast our eyes forward fifty years, to 2060, when your organization will be celebrating its hundredth anniversary. We can only imagine the technological advances of the next fifty years in the fuzziest of terms. You need only cast yourselves back fifty years to understand why. Back then, a computer as powerful as my laptop wouldn’t have filled a single building – or even a single city block. It very likely would have filled a small city, requiring its own power plant. If we have come so far in fifty years, judging where we’ll be in fifty years time is beyond the capabilities of even the most able futurist. We can only say that computers will become pervasive and nearly invisibly woven through the fabric of human culture.

Let us instead focus on how we will use technology in fifty years’ time. We can already see the shape of the future in one outstanding example – a website known as RateMyProfessors.com. Here, in a database of nine million reviews of one million teachers, lecturers and professors, students can learn which instructors bore, which grade easily, which excite the mind, and so forth. This simple site – which grew out of the power of sharing – has radically changed the balance of power on university campuses throughout the US and the UK. Students can learn from others’ mistakes or triumphs, and can repeat them. Universities, which might try to corral students into lectures with instructors who might not be exemplars of their profession, find themselves unable to fill those courses. Worse yet, bidding wars have broken out between universities seeking to fill their ranks with the instructors who receive the highest rankings.

Alongside the rise of RateMyProfessors.com, there has been an exponential increase in the amount of lecture material you can find online, whether on YouTube, or iTunes University, or any number of dedicated websites. Those lectures also have ratings, so it is already possible for a student to get to the best and most popular lectures on any subject, be it calculus or Mandarin or the medieval history of Europe.

Both of these trends are accelerating because both are backed by the power of sharing, the engine driving all of this. As we move further into the future, we’ll see the students gradually take control of the scheduling functions of the university (and probably in a large number of secondary school classes). These students will pair lecturers with courses using software to coordinate both. More and more, the educational institution will be reduced to a layer of software sitting between the student, the mentor-instructor and the courseware. As the university dissolves in the universal solvent of the network, the capacity to use the network for education increases geometrically; education will be available everywhere the network reaches. It already reaches half of humanity; in a few years it will cover three-quarters of the population of the planet. Certainly by 2060 network access will be thought of as a human right, much like food and clean water.

In 2060, Australian College of Educators may be more of an ‘Invisible College’ than anything based in rude physicality. Educators will continue to collaborate, but without much of the physical infrastructure we currently associate with educational institutions. Classrooms will self-organize and disperse organically, driven by need, proximity, or interest, and the best instructors will find themselves constantly in demand. Life-long learning will no longer be a catch-phrase, but a reality for the billions of individuals all focusing on improving their effectiveness within an ever-more-competitive global market for talent. (The same techniques employed by RateMyProfessors.com will impact all the other professions, eventually.)

There you have it. The human future is both more chaotic and more potent than we can easily imagine, even if we have examples in our present which point the way to where we are going. And if this future sounds far away, keep this in mind: today’s year 10 student will be retiring in 2060. This is their world.

Everywhere

I.

Sydney looks very little different from the city of Gough Whitlam’s day. Although almost forty years have passed, we see most of the same concrete monstrosities at the Big End of town, the same terrace houses in Surry Hills and Paddington, the same mile-after-mile of brick dwellings in the outer suburbs. Sydney has grown a bit around the edges, bumping up against the natural frontiers of our national parks, but, for a time-traveler, most things would appear nearly exactly the same.

That said, the life of the city is completely different. This is not because a different generation of Australians, from all corners of the world, inhabit the city. Rather, the city has acquired a rich inner life, an interiority which, though invisible to the eye, has become entirely pervasive, and completely dominates our perceptions. We walk the streets of the city, but we swim through an invisible ether of information. Just a decade ago we might have been said to have jumped through puddles of data, hopping from one to another as a five year-old might in a summer rainstorm. But the levels have constantly risen, in a curious echo of global warming, until, today, we must swim hard to stay afloat.

The individuals in our present-day Sydney stride the streets with divided attention, one eye scanning the scene before them, and another almost invariably fiddling with a mobile phone: sending a text, returning a call, using the GPS satellites to locate an address. Where, four decades ago, we might have kept a wary eye on passers-by, today we focus our attentions into the palms of our hands, playing with our toys. The least significant of these toys are the stand-alone entertainment devices; the iPods and their ilk, which provide a continuous soundtrack for our lives, and which insulate us from the undesired interruptions of the city. These are pleasant, but unimportant.

The devices which allow us to peer into and sail the etheric sea of data which surrounds us, these are the important toys. It’s already become an accepted fact that a man leaves the house with three things in his possession: his wallet, his keys, and his mobile. I have a particular pat-down I practice as the door to my flat closes behind me, a ritual of reassurance that tells me that yes, I am truly ready for the world. This behavioral transformation was already well underway when I first visited Sydney in 1997, and learned, from my friends’ actions, that mobile phones acted as a social lubricant. Dates could be made, rescheduled, or broken on the fly, effortlessly, without the painful social costs associated with standing someone up.

This was not a unique moment; it was simply the first in an ever-increasing series of transformations of human behavior, as the social accelerator of continuous communication became a broadly-accepted feature of civilization. The transition to frictionless social intercourse was quickly followed by a series of innovations which removed much of the friction from business and government. As individuals we must work with institutions and bureaucracies, but we have more ways to reach into them – and they, into us – than ever before. Businesses, in particular, realized that they could achieve both productivity gains and cost savings by leveraging the new facilities of communication. This relationship between commerce and the consumer produced an accelerating set of feedbacks which translated the very physical world of commerce into an enormous virtual edifice, one which sought every possible advantage of virtualization, striving to reach its customers through every conceivable mechanism.

Now, as we head into the winter of 2008, we live in a world where a seemingly stable physical environment is entirely overlaid and overweighed by a virtual world of connection and communication. The physical world has, in large part, lost its significance. It’s not that we’ve turned away from the physical world, but rather, that the meaning of the physical world is now derived from our interactions within the virtual world. The conversation we have, between ourselves, and with the institutions which serve us, frame the world around us. A bank is no longer an imposing edifice with marble columns, but an EFTPOS swipe or a statement displayed in a web browser. The city is no longer streets and buildings, but flows of people and information, each invisibly connected through pervasive wireless networks.

It is already a wireless world. That battle was fought and won years ago; truly, before anyone knew the battle had been joined, it was effectively over. We are as wedded to this world as to the physical world – perhaps even more so. The frontlines of development no longer concern themselves with the deployment of wireless communications, but rather with their increasing utility.

II.

Utility has a value. How much is it worth to me to be able to tell a mate that I’m delayed in traffic and can’t make dinner on time? Is it worth a fifty-cent voice call, or a twenty-five cent text (which may go through several iterations, and, in the end, cost me more)? Clearly it is; we are willing to pay a steep price to keep our social relationships on an even keel. What about our business relationships? How much is it worth to be able to take a look at the sales brochure for a store before we enter it? How much is it worth to find it on a map, or get directions from where we are? How much is it worth to send an absolutely vital email to a business client?

These are the economics that have ruled the tariff structures of wireless communications, both here in Australia and in the rest of the world. Bandwidth, commonly thought of as a limited resource, must be paid for. Infrastructure must be paid for. Shareholders must receive a fair return on their investments. All of these points, while valid, do not tell the whole story. The tariff structure acts as a barrier to communication, a barrier which can only be crossed if the perceived value is greater than the costs incurred. In the situations outlined above, this is often the case, and is thus the basis for the wireless telelcomms industry. But there are other economics at work, and these economics dictate a revision to this monolithic ordering of business affairs.

Chris Anderson, the editor of WIRED magazine, has been writing a series of essays in preparation for the publication of his next book, Free: Why $0.00 is the Future of Business. In his first essay – published in WIRED magazine, of course – Anderson takes a look at Moore’s Law, which promises a two-fold decrease in transistor cost every eighteen months, a rule that’s proven continuously true since Intel co-founder Gordon Moore proposed it, back in 1965. Somewhere around 1973, Anderson notes, Carver Mead, the father of VLSI, realized that individual transistors were becoming so small and so cheap as to be essentially free. Yes, in aggregates of hundreds of millions, transistors cost a few tens of dollars. But at the level of single circuits, these transistors are free, and can be “wasted” to provide some additional functionality at essentially zero additional cost. When, toward the end of the 1970s, the semiconductor industry embraced Mead’s design methodology, the silicon revolution began in earnest, powered by ever-cheaper transistors that could, as far as the designer was concerned, be considered entirely expendable.

Google has followed a similar approach to profitability. Pouring hundreds of millions of dollars into a distributed, networked architecture which crawls and indexes the Web, Google provides its search engine for free, in the now-substantiated belief that something made freely available can still generate a very decent profit. Google designed its own, cheap computers, its own, cheap operating system, and fit these into its own, expensive data centers, linked together with relatively inexpensive bandwidth. Yahoo! and Microsoft – and Baidu and Facebook and MySpace – have followed similar paths to profitability. Make it free, and make money.

This seems counterintuitive, but herein is the difference between the physical and virtual worlds; the virtual world, insubstantial and pervasive, has its own economies of scale, which function very differently from the physical world. In the virtual world, the more a resource is shared, the more valuable it becomes, so ubiquity is the pathway to profitability.

We do not think of bandwidth as a virtual resource, one that can simply be burned. In Australia, we think of bandwidth as being an expensive and scarce resource. This is not true, and has never been particularly true. Over the time I’ve lived in this country (four and a half years) I’ve paid the same fixed amount for my internet bandwidth, yet today I have roughly six times the bandwidth, and seven times the download cap. Bandwidth is following the same curve as the transistor, because the cost of bandwidth is directly correlated to the cost of transistors.

Last year I upgraded to a 3G mobile handset, the Nokia N95, and immediately moved from GPRS speeds to HSDPA speeds – roughly 100x faster – but I am still spending the same amount for my mobile, on a monthly basis. I know that some Australian telcos see Vodafone’s tariff policy as sheer lunacy. But I reckon that Vodafone understands the economics of bandwidth. Vodafone understands that bandwidth is becoming free; the only way they can continue to benefit from my custom is if they continuously upgrade my service – just like my ISP.

Telco tariffs are predicated on the basic idea that spectrum is a limited resource. But spectrum is not a limited resource. Allocations are limited, yes, and licensed from the regulatory authorities for many millions of dollars a year. But spectrum itself is not in any wise limited. The 2.4 Ghz band is proof positive of this. Just that tiny slice of spectrum is responsible for more revenue than any other slice of spectrum, outside of the GSM and 3G bands. Why is this? Because the 2.4 Ghz band is unregulated, engineers and designers have had to teach their varied devices to play well with one another, even in hostile environments. I can use a Bluetooth headset right next to my WiFi-enabled MacBook, and never experience any problems, because these devices use spread-spectrum and spectrum-hopping to behave politely. My N95 can use WiFi and Bluetooth networking simultaneously – yet there’s never interference.

Unlicensed spectrum is not anarchy. It is an invitation to innovate. It is an open door to the creative engines of the economy. It is the most vital part of the entire wireless world, because it is the corner of the wireless world where bandwidth already is free.

III.

And so back to the city outside the convention center walls, crowded with four million people, each eagerly engaged in their own acts of communication. Yet these moments are bounded by an awareness of the costs of this communication. These tariffs act as a fundamental brake on the productivity of the Australian economy. They fetter the means of production. And so they must go.

I do not mean that we should nationalize the telcos – we’ve already been there – but rather, that we must engage in creating a new generation of untarriffed networks. The technology is already in place. We have cheap and durable mesh routers, such as the Open-Mesh and the Meraki, which can be dropped almost anywhere, powered by sun or by mains, and can create a network that spans nearly a quarter kilometer square. We can connect these access points to our wired networks, and share some small portion of our every-increasing bandwidth wealth with the public at large, so that no matter where they are in this city – or in this nation – they can access the wireless world. And we can secure these networks to prevent fraud and abuse.

Such systems already exist. In the past eight months, Meraki has given their $50 WiFi mesh routers to any San Franciscan willing to donate some of their ever-cheaper bandwidth to a freely available municipal network. When I started tracking the network, it had barely five thousand users. Today, it has over seventy thousand – that’s about one-tenth of the city. San Francisco is a city of hills and low buildings – it’s hard to get real reach from a wireless signal. In Sydney, Melbourne, Adelaide, Brisbane and Perth – which are all built on flats – a little signal goes a long, long way. From my flat in Surry Hills I can cover my entire neighborhood. If another of my neighbors decides to contribute, we can create a mesh which reaches further into my neighborhood, where it can link up with another volunteer, further in the neighborhood, and so on, and so on, until the entirety of my suburb is bathed in freely available wireless connectivity.

While this may sound like a noble idea, that is not the reason it is a good idea. Free wireless is a good idea because it enables an entirely new level of services, which would not, because of tariffs, make economic sense. This type of information has value – perhaps great value, to some – but no direct economic value. This is where the true strength of free wireless shows itself: it enables a broad participation in the electronic life of the city by all participants – individuals, businesses, and institutions – without the restraint of economic trade-offs.

This unlicensed participation has no form as yet, because we haven’t deployed the free wireless network beyond a few select spots in Australia’s cities. But, once the network has been deployed, some enterprising person will develop the “killer app” for this network, something so unexpected, yet so useful, that it immediately becomes apparent that the network is an incredibly valuable resource, one which will improve human connectivity, business productivity, and the delivery of services. Something that, once established, will be seen as an absolutely necessary feature in the life of the city.

Businessmen hate to deal in intangibles, or wild-eyed “science projects.” So instead, let me present you with a fait accompli: This is happening. We’re reaching a critical mass of Wifi devices in our dense urban cores. Translating these devices into nodes within city-spanning mesh networks requires only a simple software upgrade. It doesn’t require a hardware build-out. The transformation, when it comes, will happen suddenly and completely, and it will change the way we view the city.

The question then, is simple: are you going to wait for this day, or are you going to help it along? It could be slowed down, fettered by lawsuits and regulation. Or it could be accelerated into inevitability. We’re at a transition point now, between the tariffed networks we have lived with for the last decade, and the new, free networks, which are organically popping up in Australia and throughout the world. Both networks will co-exist; a free network actually increases the utility of a tariffed mobile network.

So, do you want to fight it? Or do you want to switch it on?

Understanding Gilmore’s Law: Telecoms Edition

OR,
How I Quit Worrying and Learned to be a Commodity

Introduction


“The net interprets censorship as damage and routes around it.”
– John Gilmore

I read a very interesting article last week. It turns out that, despite their best efforts, the Communist government of the People’s Republic of China have failed to insulate their prodigious population from the outrageous truths to be found online. In the article from the Times, Wang Guoqing, a vice-minister in the information office of the Chinese cabinet was quoted as saying, “It has been repeatedly proved that information blocking is like walking into a dead end.” If China, with all of the resources of a one-party state, and thus able to “lock down” its internet service providers, directing their IP traffic through a “great firewall of China”, can not block the free-flow of information, how can any government, anywhere – or any organization, or institution – hope to try?

Of course, we all chuckle a little bit when we see the Chinese attempt the Sisyphean task of damming the torrent of information which characterizes life in the 21st century. We, in the democratic West, know better, and pat ourselves on the back. But we are in no position to throw stones. Gilmore’s Law is not specifically tuned for political censorship; censorship simply means the willful withholding of information – for any reason. China does it for political reasons; in the West our reasons for censorship are primarily economic. Take, for example, the hullabaloo associated with the online release of Harry Potter and the Deathly Hallows, three days before its simultaneous, world-wide publication. It turns out that someone, somewhere, got a copy of the book, and laboriously photographed every single page of the 784-page text, bound these images together into a single PDF file, and then uploaded it to the global peer-to-peer filesharing networks. Everyone with a vested financial interest in the book – author J.K. Rowling, Bloomsbury and Scholastic publishing houses, film studio Warner Brothers – had been feeding the hype for the impending release, all focused around the 21st of July. An enormous pressure had been built up to “peek at the present” before it was formally unwrapped, and all it took was one single gap in the $20 million security system Bloomsbury had constructed to keep the text safely secure. Then it became a globally distributed media artifact. Curiously, Bloomsbury was reported as saying they thought it would only add to sales – if many people are reading the book now, even illegally, then even more people will want to be reading the book right now. Piracy, in this case, might be a good thing.

These two examples represent two data points which show the breadth and reach of Gilmore’s Law. Censorship, broadly defined, is anything which restricts the free flow of information. The barriers could be political, or they could be economic, or they could – as in the case immediately relevant today – they could be a nexus of the two. Broadband in Australia is neither purely an economic nor purely a political issue. In this, broadband reflects the Janus-like nature of Telstra, with one face turned outward, toward the markets, and another turned inward, toward the Federal Government. Even though Telstra is now (more or less) wholly privatized, the institutional memory of all those years as an arm of the Federal Government hasn’t yet been forgotten. Telstra still behaves as though it has a political mandate, and is more than willing to use its near-monopoly economic strength to reinforce that impression.

Although seemingly unavoidable, given the established patterns of the organization, Telstra’s behavior has consequences. Telstra has engendered enormous resentment – both from its competitors and its customers – for its actions and attitude. They’ve recently pushed the Government too far (at least, publicly), and have been told to back off. What may not be as clear – and what I want to warn you of today – is how Telstra has sewn the seeds of its own failure. What’s more, this may not be anything that Telstra can now avoid, because this is neither a regulatory nor an economic failure. It can not be remedied by any mechanism that Telstra has access to. Instead, it may require a top-down rethinking of the entire business.

I: Network Effects

For the past several thousand years, the fishermen of Kerala, on the southern coast of India, have sailed their dhows out into the Indian Ocean, lowered their nets, and hoped for the best. When the fishing is good, they come back to shore fully laden, and ready to sell their catch in the little fish markets that dot the coastline. A fisherman might have a favorite market, docking there only to find that half a dozen other dhows have had the same idea. In that market there are too many fish for sale that day, and the fisherman might not even earn enough from his catch to cover costs. Meanwhile, in a market just a few kilometers away, no fishing boats have docked, and there’s no fish available at any price. This fundamental chaos of the fish trade in Kerala has been a fact of life for a very long time.

Just a few years ago, several of India’s rapidly-growing wireless carriers strung GSM towers along the Kerala coast. This gives those carriers a signal reach of up to about 25km offshore – enough to be very useful for a fisherman. While mobile service in India is almost ridiculously cheap by Australian standards – many carriers charge a penny for an SMS, and a penny or two per minute for voice calls – a handset is still relatively expensive, even one such as the Nokia 1100, which was marketed specifically at emerging mobile markets, designed to be cheap and durable. Such a handset might cost a month’s profits for a fisherman – which makes it a serious investment. But, at some point in the last few years, one fisherman – probably a more prosperous one – bought a handset, and took it to sea. Then, perhaps quite accidentally, he learned, through a call ashore, of a market wanting for fish that day, brought his dhow to dock there, and made a handsome profit. After that, the word got around rapidly, and soon all of Kerala’s fisherman were sporting their own GSM handsets, calling into shore, making deals with fishmongers, acting as their own arbitrageurs, creating a true market where none had existed before. Today in Kerala the markets are almost always stocked with just enough fish; the fishmongers make a good price for their fish, and the fishermen themselves earn enough to fully recoup the cost of their handsets in just two months. Mobile service in Kerala has dramatically altered the economic prospects for these people.

This is not the only example: in Kenya farmers call ahead to the markets to learn which ones will have the best prices for their onions and maize; spice traders, again in Kerala, use SMS to create their own, far-flung bourse. Although we in the West generally associate mobile communications with affluent lifestyles, a significant number of microfinance loans made by Grameen Bank in Bangladesh, and others in Pakistan, India, Africa and South America are used to purchase mobile handsets – precisely because the correlation between access to mobile communications and earning potential has become so visible in the developing world. Grameen Bank has even started its own carrier, GrameenPhone, to service its microfinance clientele.

Although economists are beginning to recognize and document this curious relationship between economics and access to communication, it needs to be noted that this relationship was not predicted – by anyone. It happened all by itself, emerging from the interaction of individuals and the network. People – who are always the intelligent actors in the network – simply recognized the capabilities of the network, and put them to work. As we approach the watershed month of October 2007, when three billion people will be using mobile handsets, when half of humanity will be interconnected, we can expect more of the unexpected.

All of this means that none of us – even the most foresighted futurist – can know in advance what will happen when people are connected together in an electronic network. People themselves are too resourceful, and too intelligent, to model their behavior in any realistic way. We might be able to model their network usage – though even that has confounded the experts – but we can’t know why they’re using the network, nor what kind of second-order effects that usage will have on culture. Nor can we realistically provision for service offerings; people are more intelligent, and more useful, than any other service the carriers could hope to offer. The only truly successful service offering in mobile communications is SMS – because it provides an asynchronous communications channel between people. The essential feature of the network is simply that it connects people together, not that it connects them to services.

This strikes at the heart of the most avaricious aspects of the carriers’ long-term plans, which center around increasing the levels of services on offer, by the carrier, to the users of the network. Although this strategy has consistently proven to be a complete failure – consider Compuserve, Prodigy and AOL – it nevertheless has become the idée fixe of shareholder reports, corporate plans, and press releases. The network, we are told, will become increasingly more intelligent, more useful, and more valuable. But all of the history of the network argues directly against this. Nearly 40 years after its invention, the most successful service on the Internet is still electronic mail, the Internet’s own version of SMS. Although the Web has become an important service in its own right, it will never be as important as electronic mail, because it connects individuals.

Although the network in Kerala was brought into being by the technology of GSM transponders and mobile handsets, the intelligence of the network truly does lie in the individuals who are connected by the network. Let’s run a little thought experiment, and imagine a world where all of India’s telecoms firms suffered a simultaneous catastrophic and long-lasting failure. (Perhaps they all went bankrupt.) Do you suppose that the fishermen would simply shrug their shoulders and go back to their old, chaotic market-making strategies? Hardly. Whether they used smoke signals, or semaphores, or mirrors on the seashore, they’d find some way to maintain those networks of communication – even in the absence of the technology of the network. The benefits of the network so outweigh the implementation of the network that, once created, networks can not be destroyed. The network will be rebuilt from whatever technology comes to hand – because the network is not the technology, but the individuals connected through it.

This is the kind of bold assertion that could get me into a lot of trouble; after all, everyone knows that the network is the towers, the routers, and the handsets which comprise its physical and logical layers. But if that were true, then we could deterministically predict the qualities and uses of networks well in advance of their deployment. The quintessence of the network is not a physical property; it is an emergent property of the interaction of the network’s users. And while people do persistently believe that there is some “magic” in the network, the source of that magic is the endlessly inventive intellects of the network’s users. When someone – anywhere in the network – invents a new use for the network, it propagates widely, and almost instantaneously, transmitted throughout the length and breadth of the network. The network amplifies the reach of its users, but it does not goad them into being inventive. The service providers are the users of the network.

I hope this gives everyone here some pause; after all, it is widely known that the promise to bring a high-speed broadband network to Australia is paired with the desire to provide services on that network, including – most importantly – IPTV. It’s time to take a look at that promise with our new understanding of the real power of networks. It is under threat from two directions: the emergence of peer-produced content; and the dramatic, disruptive collapse in the price of high-speed wide-area networking which will fully power individuals to create their own network infrastructure.

II: DIYnet

Although nearly all high-speed broadband providers – which are, by and large, monopoly or formerly monopoly telcos – have bet the house on the sale of high-priced services to finance the build-out of high-speed (ADSL2/FTTN/FTTH) network infrastructure, it is not at all clear that these service offerings will be successful. Mobile carriers earn some revenue from ringtone and game sales, but this is a trivial income stream when compared to the fees they earn from carriage. Despite almost a decade of efforts to milk more ARPU from their customers, those same customers have proven stubbornly resistant to a continuous fleecing. The only thing that customers seem obviously willing to pay for is more connectivity – whether that’s more voice calls, more SMS, or more data.

What is most interesting is what these customers have done with this ever-increasing level of interconnectivity. These formerly passive consumers of entertainment have become their own media producers, and – perhaps more ominously, in this context – their own broadcasters. Anyone with a cheap webcam (or mobile handset), a cheap computer, and a broadband link can make and share their own videos. This trend had been growing for several years, but since the launch of YouTube, in 2005, it has rocketed into prominence. YouTube is now the 4th busiest website, world-wide, and perhaps 65% of all video downloads on the web take place through Google-owned properties. Amateur productions regularly garner tens of thousands of viewers – and sometimes millions.

We need to be very careful about how we judge both the meaning of the word “amateur” in the context of peer-produced media. An amateur production may be produced with little or no funding, but that does not automatically mean it will appear clumsy to the audience. The rough edges of an amateur prodution are balanced out by a corresponding increase in salience – that is, the importance which the viewer attaches to the subject of the media. If something is compelling because it is important to us – something which we care passionately about – high production values do not enter into our assessment. Chad Hurley, one of the founders of YouTube has remarked that the site has no “gold-standard” for production; in fact, YouTube’s gold-standard is salience – if the YouTube audience feels the work is important, audience members will share it within their own communities of interest. Sharing is the proof of salience.

After two years of media sharing, the audience for YouTube (which is now coincident with the global television audience in the developed world) has grown accustomed to being able to share salient media freely. This is another of the unexpected and unpredicted emergent effects of the intelligence of humans using the network. We now have an expectation that when we encounter some media we find highly salient, we should be able to forward it along within our social networks, sharing it within our communities of salience. But this is not the desire of many copyright holders, who collect their revenues by placing barriers to the access of media. This fundamental conflict, between the desire to share, as engendered by our own interactions with the network, and the desire of copyright holders to restrain media consumption to economic channels has, thus far, been consistently resolved in favor of sharing. The copyright holders have tried to use the legal system as a bludgeon to change the behavior of the audience; this has not, nor will it ever work. But, as the copyright holders resort to ever-more-draconian techniques to maintain control over the distribution of their works, the audience is presented with an ever-growing world of works that are meant to be shared. The danger here is that the audience is beginning to ignore works which they can not share freely, seeing them as “broken” in some fundamental way. Since sharing has now become an essential quality of media, the audience is simply reacting to a perceived defect in those works. In this sense, the media multinationals have been their own worst enemies; by restricting the ability of the audiences to share the works they control, they have helped to turn audiences toward works which audiences can distribute through their own “do-it-yourself” networks.

These DIYnets are now a permanent fixture of the media landscape, even as their forms evolve through YouTube playlists, RSS feeds, and sharing sites such as Facebook and Pownce. These networks exist entirely outside the regular and licensed channels of distribution; they are not suitable – legally or economically – for distribution via a commercial IPTV network. Telstra can not provide these DIYnets to their customers through its IPTV service – nor can any other broadband carrier. IPTV, to a carrier, means the distribution of a few hundred highly regularized television channels. While there will doubtless be a continuing market for mass entertainment, that audience is continuously being eroded by a growing range of peer-produced programming which is growing in salience. In the long-term this, like so much in the world, will probably obey an 80/20 rule, with about 80 percent of the audience’s attention absorbed in peer-produced, highly-salient media, while 20 percent will come from mass-market, high-production-value works. It doesn’t make a lot of sense to bet the house on a service offering which will command such a small portion of the audience’s attention. Yes, Telstra will offer it. But it will never be able to compete with the productions created by the audience.

Because of this tension between the desires of the carrier and the interests of the audience, the carrier will seek to manipulate the capabilities of the broadband offering, to weight it in favor of a highly regularized IPTV offering. In the United States this has become known as the “net neutrality” argument, and centers on the question of whether a carrier has the right to shape traffic within its own IP network to advantage its own traffic over that of others. In Australia, the argument has focused on tariff rates: Telstra believes that if they build the network, they should be able to set the tariff. The ACCC argues otherwise. This has been the characterized as the central stumbling block which has prevented the deployment of a high-speed broadband network across the nation, and, in some sense that is entirely true – Telstra has chosen not move forward until it feels assured that both economic and regulatory conditions prove favorable. But this does not mean that the consumer demand for a high-speed network was simply put on pause over the last years. More significantly, the world beyond Telstra has not stopped advancing. While it now costs roughly USD $750 per household to provide a high-speed fiber-optic connection to the carrier network, other technologies are coming on-line, right now, which promise to reduce those costs by an order of magnitude, and furthermore, which don’t require any infrastructure build-out on the part of the carrier. This disruptive innovation could change the game completely.

III: Check, Mate

All parties to the high-speed broadband dispute – government, Telstra, the Group of Nine, and the public – share the belief that this network must be built by a large organization, able to command the billions of dollars in capital required to dig up the streets, lay the fiber, and run the enormous data centers. This model of a network is an reflection in copper, plastic and silicon, of the hierarchical forms of organization which characterize large institutions – such as governments and carriers. However, if we have learned anything about the emergent qualities of networks, it is that they quickly replace hierarchies with “netocracies“: horizontal meritocracies, which use the connective power of the network to out-compete slower and rigid hierarchies. It is odd that, while the network has transformed nearly everything it has touched, the purveyors of those networks – the carriers – somehow seem immune from those transformative qualities. Telecommunications firms are – and have ever been – the very definition of hierarchical organizations. During the era of plain-old telephone service, the organizational form of the carrier was isomorphic to the form of the network. However, over the last decade, as the internal network has transitioned from circuit-switched to packed-switched, the institution lost synchronization with the form of the network it provided to consumers. As each day passes, carriers move even further out of sync: this helps to explain the current disconnect between Telstra and Australians.

We are about to see an adjustment. First, the data on the network was broken into packets; now, the hardware of the network has followed. Telephone networks were centralized because they required explicit wiring from point-to-point; cellular networks are decentralized, but use licensed spectrum – which requires enormous capital resources. Both of these conditions created significant barriers to entry. But there is no need to use wires, nor is there any need to use licensed spectrum. The 2.4 GHz radio band is freely available for anyone to use, so long as that use stays below certain power values. We now see a plethora of devices using that spectrum: cordless handsets, Bluetooth devices, and the all-but-ubiquitous 802.11 “WiFi” data networks. The chaos which broadcasters and governments had always claimed would be the by-product of unlicensed spectrum has, instead, become an wonderfully rich marketplace of products and services. The first generation of these products made connection to the centralized network even easier: cordless handsets liberated the telephone from the twisted-pair connection to the central office, while WiFi freed computers from heavy and clumsy RJ-45 jacks and CAT-5 cabling. While these devices had some intelligence, that intelligence centered on making and maintaining a connection to the centralized network.

Recently, advances in software have produced a new class of devices which create their own networks. Devices connected to these ad-hoc “mesh” networks act as peers in a swarm (similar to the participants in peer-to-peer filesharing), rather than clients within a hierarchical distribution system. These network peers share information about their evolving topology, forming a highly-resilient fabric of connections. Devices maintain multiple connections to multiple nodes throughout the network, and a packet travels through the mesh along a non-deterministic path. While this was always the promise of TCP/IP networks, static routes through the network cloud are now the rule, because they provide greater efficiency, make it easier to maintain the routers, diagnose network problems, and keeps maintenance costs down. But mesh networks are decentralized; there is no controlling authority, no central router providing an interconnection with a peer network. And – most significantly – mesh networks now incredibly inexpensive to implement.

Earlier this year, the US-based firm Meraki launched their long-awaited Meraki Mini wireless mesh router. For about AUD $60, plus the cost of electricity, anyone can become a peer within a wireless mesh network providing speeds of up to 50 megabits per second. The device is deceptively simple; it’s just an 802.11 transceiver paired with a single-chip computer running LINUX and Meraki’s mesh routing software – which was developed by Meraki’s founders while Ph.D. students at the Massachusetts Institute of Technology. The 802.11 radio within the Meraki Mini has been highly optimized for long-distance communication. Instead of the normal 50 meter radius associated with WiFi, the Meraki Mini provides coverage over at least 250 meters – and, depending upon topography, can reach 750 meters. Let me put that in context, by showing you the coverage I’ll get when I install a Meraki Mini on my sixth-floor balcony in Surry Hills:



From my flat, I will be able to reach all the way from Central Station to Riley Street, from Belvoir Street over to Albion Street. Thousands of people will be within range of my network access point. Of course, if all of them chose to use my single point of access, my Meraki Mini would be swamped with traffic. It simply wouldn’t be able to cope. But – given that the Meraki Mini is cheaper than most WiFi access points available at Harvey Norman – it’s likely that many people within that radius would install their own access points. These access points would detect each others’ presence, forming a self-organizing mesh network. If every WiFi access point visible from my flat (I can sense between 10 and 20 of them at any given time) were replaced with a Meraki Mini, or, perhaps more significantly, if these WiFi access points were given firmware upgrades which allowed them to interoperate with the mesh networks created by the Meraki Mini – my Surry Hills neighborhood would suddenly be blanketed in a highly resilient and wholly pervasive wireless high-speed network, at nearly no cost to the users of that network. In other words, this could all be done in software. The infrastructure is already deployed.

As some of you have no doubt noted, this network is highly local; while there are high-speed connections within the wireless cloud, the mesh doesn’t necessarily have connections to the global Internet. In fact, Meraki Minis can act as routers to the Internet, routing packets through their Ethernet interfaces to the broader Internet, and Meraki recommends that at least every tenth device in a mesh be so equipped. But it’s not strictly necessary, and – if dedicated to a particular task – completely unnecessary. Let us say, for example, that I wanted to provide a low-cost IPTV service to the residents of Surry Hills. I could create a “head-end” in my own flat, and provide my “subscribers” with Meraki Minis and an inexpensive set-top-box to interface with their televisions. For a total install cost of perhaps $300, I could give everyone in Surry Hills a full IPTV service (though it’s unlikely I could provide HD-quality). No wiring required, no high-speed broadband buildout, no billions of dollars, no regulatory relaxation. I could just do it. And collect both subscriber fees and advertiser revenues. No Telstra. No Group of Nine. No blessing from Senator Coonan. No go-over by the ACCC. The technology is all in place, today.

Here’s a news report – almost a year old – which makes the point quite well:

I bring up this thought experiment to drive home my final point: Telstra isn’t needed. It might not even be wanted. We have so many other avenues open to us to create and deploy high-speed broadband services that it’s likely Telstra has just missed the boat. You’ve waited too long, dilly-dallying while the audience and the technology have made you obsolete. The audience doesn’t want the same few hundred channels they can get on FoxTel: they want the nearly endless stream of salience they can get from YouTube. The technology is no longer about centralized distribution networks: it favors light, flexible, inexpensive mesh networks. Both of these are long-term trends, and both will only grow more pronounced as the years pass. In the years it takes Telstra – or whomever gets the blessing of the regulators – to build out this high-speed broadband network, you will be fighting a rearguard action, as both the audience and the technology of the network race on past you. They have already passed you by, and it’s been my task this morning to point this out. You simply do not matter.

This doesn’t mean it’s game over. I don’t want you to report to Sol Trujilo that it’s time to have a quick fire-sale of Telstra’s assets. But it does mean you need to radically rethink your business – right now. In the age of pervasive peer-production, paired with the advent of cheap wireless mesh networks, your best option is to become a high-quality connection to the global Internet – in short, a commodity. All of this pervasive wireless networking will engender an incredible demand for bandwidth; the more people are connected together, the more they want to be connected together. That’s the one inarguable truth we can glean from the 160 years of electric communication. Telstra has the infrastructure to leverage itself into becoming the most reliable data carrier connecting Australians to the global Internet. It isn’t glamorous, but it is a business with high barriers to entry, and promises a steadily growing (if unexciting) continuing revenue stream. But, if you continue to base your plans around selling Australians services we don’t want, you are building your castles on the sand. And the tide is rising.