CIS -- 1-3 January 13, 2006
I. Introduction
A. Info-Communications Revolution:
1. Marking every industrial and economic transformation are new forms of scarcity and new forms of abundance.
2. Critical notion here: relationship between technological development and labor productivity. Relates to Marx.
B. “From time to time, the structure of nations and economies goes through a technological wringer. A new invention radically reduces the price of a key factor of production and precipitates an industrial revolution. Before long, every competitive business in the economy must wring out the residue of the old costs and customs from all its products and practices.
1. The steam engine, for example, drastically reduced the price of physical force. Power once wreaked at great expense from human and animal muscle pulsed cheaply and tirelessly from machines burning coal and oil. Throughout the world, dominance inexorably shifted to businesses and nations that reorganized themselves to exploit the suddenly cheap resource. Eventually every human industry and activity, from agriculture and sea transport to printing and war, had to centralize and capitalize itself to take advantage of the new technology.
2. Over the last hundred years, there have been three such economic eras:
a. The industrial era fed on the plummeting price of physical force or energy, best measured in watts. Some 30 years ago, with the regulatory sclerosis of the nuclear and natural gas industries, the price of watts began to plateau, dropping less than 0.7% per year for the last 35 years.
b. The last 30 years brought the reign of the microcosm, which fed on the plummeting price of transistors, manifested in the exponential drop in the cost of computer MIPS (millions of instructions per second) and memory bits. For the last 30 years, the price of a bit of semiconductor memory has dropped 68% per year. With this year's decline in DRAM prices, the trend line is being resumed after a four-year hiatus.
(1) Moore’s Law
(2) Flexibility. Basic computer chip could be used to manipulate information in almost any way. As cost dropped, began to be adapted to many different uses: home appliances, autos, and, most importantly:
(3) Communication networks: switches became increasingly computerized. Gradually separation of network from computer became blurred.
(4) Proliferation of transmission media (cellular, satellite) at the same time as a proliferation of terminal types (pagers, cell phones, fax, PCs, etc.)
c. Distributive revolution: from mainframes to PC: a function of Moore’s Law, but NOT inevitable.
(1) Creates possibility of Internet.
d. Third is collapse in cost of bandwidth, as a result of revolutionary new technologies in fiber and cellular. In every industrial transformation, businesses prosper by using the defining abundance of their era to alleviate the defining scarcity. Today this challenge implies a commanding moral imperative: to use Internet bandwidth in order to stop wasting the customer's time.
e. Big wait now is how wide bandwidth will be introduced: clearly not a technological problem: issues are strictly social, economic and political: who will pay, who will regulate.
II. Sociological Matrix of Info-Communications:
A. The ways that the PC and the Internet involve a new matrix of interactions between society and technology, in which institutions (both private and public) and their ideas are inscribed in particular technological artifacts (machines, networks, software, etc.), which are in turn appropriated by user communities (of all kinds) in ways unanticipated by the institutions that created them, which reflects back on future decisions by these institutions.
III. Digital Convergence
A. The Info-Communications (afterwards IC) revolution involves the digital convergence of three key technologies: computing, telecommunications and broadcasting, and is characterized by the incredibly rapid decline in costs of key factors of information processing and communication, in particular computing power and the transmission of digital information, both through fiber and wireless.
1. Computer without network: fancy adding machine and typewriter.
IV. Death of Distance: Introduction
A. Attitudes toward technological change: celebration and suspicion.
1. Cairncross: celebratory, mostly.
2. Try to strike a balanced pose.
B. What is the D of D?: Distance will no longer determine the cost of communicating electronically.
C. Many implications of this transformation.
V. Potential changes; always “unintended consequences.” Countervailing tendencies.
A. Death of Distance
B. Fate of location
C. Improved connections
1. Future of the Internet “in its present form”
2. Switched
3. Interactive
4. Broadband
D. Increased mobility
E. More customized networks: portal sites “My Yahoo,”
F. Deluge of information: problems created by “information overload.”
1. Issues of authorities
G. Increased Value of Brand
H. More minnows, more giants
I. More competition
J. Increased value of niches
K. Communities of practice: virtual communities based on commonalities that transcend location.
L. Loose-knit corporation
M. Openness as a strategy — will this continue?
N. Manufacturers as service providers — only way to differentiate
O. Inversion of home and office — why is Silicon Valley so crowded?
P. Proliferations of ideas
Q. Decline of national authority — countervailing trends? May undermine openness.
R. Loss of privacy
S. Global premium for skills — tends to increase inequality, makes education more important. Local semi-skilled, unskilled devalued. Skilled labor’s value enhanced.
T. Rise of English
U. Communities of culture. Niche + community of practice
V. A New Trust?
W. People as the ultimate scarce resource: yes and no
X. Global peace???
VI. New Economy — Globalization
A. Information-based. Knowledge and information have become the basis of productivity. Based on the possibility of real-time feedback. Classic problems put forward as to why expansion of networks had not increased productivity:
1. Made possible by tech changes in communication & transportation
2. Has led to spread of open society
B. Globalization
1. We already had a world system, world trade. New is that core activities of the world economy now are capable of being organized and functioning on a world scale in real time.
2. Core production system is organized globally. This is new. Key issue is not trade, but internationalization of production.
3. Consumption
4. Culture