How information flow empowers innovation – Part 3

Much has been said and written about the transformative power of the internet; how it affects every aspect of our lives; how it keeps changing our economy, society, culture. Today, I’ll take stock of the most profound effects the internet has had so far.

For me, the term the internet” is a chiffre for the current performance level that information and communication technology has achieved; this technology is far more than just the network itself (for a concise summary, see Gil Press’ very short history). Its development included the digital revolution; it saw the mainframe computer come and go (disrupted by the personal computer); it saw the rise of mobile telephones and their morphing into smart phones; it saw the ever faster sequence of new generations of mobile devices (laptops, notebooks, netbooks, tablets, phablets, you name it); and it saw a variety of networks: short and long distance, wired and wireless: the internet as we know it today results from the convergence of many different technologies. Collectively, they have transformed our society in many more ways than we are aware of, in ways that were beyond imagination for our grandparents and, in many cases, even our parents. Without a doubt, the internet is truly empowering us – every day.

  • The internet is the great connector – at minimal access cost, everybody can participate in information exchange around the globe, instantaneously.
  • The internet is the big easy – you only need a single access point, which can be your computer or your smart phone; whenever and wherever you want, 24/7, the world at your fingertips.
  • The internet also is the big integrator – all previously available channels for information handling, newspapers, books, telephone, radio, television, plus movies and music, are increasingly integrated in this digital one-stop-shop.
  • The internet gives us more – apart from additional information channels like e-mail, Instant Messages, or videophony, we now have an entirely new network mode: many-to-many information exchange in two-directions. Just consider chat rooms, blogs, and social media of all shapes and forms.
  • Finally, the internet has freed us – we do not need a translator or decoder anymore to access information. Since user experience has become a dominant consideration in designing new services or devices, people of all ages can intuitively roam the cyber space.

And all these gifts have greatly enhanced our ability to innovate. In the words of Matt Ridley, innovation is driven by ideas meeting and mating. The internet has been the key instrument to bring more ideas in the mix, to accelerate the exchange of those ideas, and to create more opportunities for combining and recombining them. The internet has created the most democratic, least centralised network for information exchange in human history. Clearly a success story.

On the other hand, this journey has just started a few decades ago, and the final destination is not yet known. The ongoing stormy evolution of the internet still holds a couple of challenges for us.

  • Speed – for the first time, a technology evolves faster than we can follow: the cycles for new generations of devices, services, operating systems, and apps have contracted to less than twelve months. That breathless turnover is breathtaking for many consumers; for unlike in previous centuries, a human generation today experiences many technology generations. Will we be able to cope? Or are we approaching a yet unknown limit of technology adoption?
  • Skills – the internet is the first innovation that is poised to disband print and handwriting for information storage … I exaggerate? Well, already for 2016, Finland has decided to change its primary school curriculum to replace handwriting with typing lessons in order to prepare the young generation for the digital present. Will there still a place for handwriting? And what are the essential skills we’ll need for handling information in the 21st century?
  • Business – as Tim Wu had pointed out in The Master Switch, business models in the information domain favour empires and centralisation. For the internet, and just as one example, the discussion on net neutrality is still ongoing; the outcome will have far more impact than just a change in corporate revenue. To what extent will we allow corporations to shape our information future according to their business needs?
  • Volume – today, we are getting close to three billion internet users globally. While that is an impressive number, the Internet of Things will change the playing field substantial. Imagine that every IT device, but also every light bulb, radiator, fridge, car, every item of technology has its own IP address to contribute to a relentlessly increasing stream of data. How are going to deal with that volume? Technologically? Psychologically?
  • Sense – the mass of available information and data is overwhelming already, and it will keep growing. Access is no problem any more. Rather, the single biggest challenge is going to be in making sense of what is so abundantly available. It’s all about understanding it and using it wisely. How will we do that? Again, that’s a question with a technological and a psychological/cognitive facet.

Where is all of that leading us? I’d suggest that the internet is a technology domain that underpins our current and future information exchange and communication. Following Brian Arthur’s ideas, technology domains co-evolve with society in a process of mutual adaption. And the outcome is far from predetermined. Based on this two-way relation between the internet and society, we can ask two essential questions about our information future: What are we doing with the information? And: What is the information doing with us?

These two questions will shape the upcoming post to conclude this short series on information flow, its evolution and its effect on our innovation capacity.



  1. cardiffkook says:

    I would add that capitalizing on the network capabilities on the Internet is something which requires institutional innovation, and institutional innovation has traditionally been much slower to change and adapt than technical issues*. My guess is we haven’t seen nothin’ yet.

    *I remember reading somewhere that early electrified factories ran the same and were configured the same as the old steam powered factories they replaced. The gains in productivity came as the old assumptions on how factories are laid out and how work is managed and divided were slowly but surely optimized to the new technology.

    • Thanks for the feedback.

      I couldn’t agree more. The internet as we currently know it has just launched us into a transformation process without a known outcome. That is very much in line with Brian Arthur’s concept of the co-evolution of technology domains and society: they encounter each other and mutually adapt over time.

      We see that very clearly with the internet. While the underlying technology matures and spreads to wider use, the very users are trying to figure out what they can do with it. Usually, questions will first arise around economic considerations, a.k.a. business: Could old business models be applied? What are novel, viable business models to employ? How will such a novel market evolve? And soon thereafter we’ll see, as we currently do, legal considerations as well: Who owns the internet? How to protect personal data? How do we want to regulate the internet? How can we? How does law-enforcement work in a virtual space?

      That is currently being discussed, and the situation is perfectly comparable to the case you mention: the steam powered factory was essentially built around one big steam engine and lots of transmission belts to drive the machines, whereas the electrified factory worked best with lots of small electric engines, one for each machine. So the pattern for energy generation and distribution had to be changed. Even though it didn’t take the factory owners very long to figure out the benefits, the rearrangement of the entire factory layout required enormous investments. Hence most manufacturers simply stuck to the old layout until the old machines and engines were run down and written off. For the market incumbents, their legacy actually posed an obstacle, whereas the newcomers could directly take the leap to the new approach.

      So I fully agree, it’s never just about the technology by itself. Rather, it’s always the technology in the hands of the user and in the context of society.

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