The Paradox that is Copyright

The advertising model for revenue generation on the Internet is effective when a 3rd party is prepared to pay for advertising to gain access to sell their product to your audience but it is inefficient and ineffective in many areas particularly when the value of that access is low or when such access distracts your audience from the use of the product that assembled the audience in the first place. This model worked well for media and brilliantly for Google. There are also excellent variations. Construction Data Management applied this model to the construction industry by collecting building plans from architects without cost in exchange for providing the architects with costing data by region and CDM in turn built a...

A Knowledge Economy Needs a Digital Currency

Whilst we have been ripping off music and cheering as software and news became free, the work we were doing every day increasingly relies upon respect for and valuing of intellectual property. But as free software, music and news have undermined the value of intellectual property we have undermined the very basis for our emerging knowledge economy. When the advertising revenue streams for our major newspapers are taken by Google because they can freely place their ads alongside any newspaper content then who will be paying the salary of the investigative journalist working on the next Watergate break in? It is not the sensational story that is important it is the constant enquiry into the power and politics of every...

Our Copyright Laws are a Mess

Over the last several weeks I have addressed the importance of trust, payments systems and security and I must once again return to address the most fundamental challenge of the digital world – copyright. How often have you heard “Copyright is dead, it’s an outmoded concept destroyed by students all over the world who refuse to pay for any digital content, especially music.” The conclusion to this discussion usually goes “like drug laws copyright laws just turn students into criminals, and won’t stop downloading so they are irrelevant and should be abolished.” This expresses a widely held view but this attacks the fundamental and essential core of any successful knowledge economy. In the US in the 20s there was...

Governments Must Act on Digital Payments

Unfortunately today the Web is straddled with a very uncompetitive payments system dominated by banks guarding their monopoly. We need a frictionless, ubiquitous payments system to efficiently exchange value as we communicate and collaborate with our networks with no additional charge for moving money internationally and no long delays in processing transactions. The banks and credit card companieshave built a proprietary, locked-down system that despite substantially lower costs for computing, storage and communications they are charging similar fees as they did 50 years ago. Daniel Roth at Wired warned the banks “it’s safe to say that the payment industry is going to change dramatically. As money becomes completely digitised, infinitely transferable, and friction-free, it will again revolutionise how we...

Creating Value on a Digital Canvass

Building trust in the connected economy will have important economic and moral benefits. This graph maps trust against GDP per capita and is from a 1996 study that asked “generally speaking would you say that most people can be trusted”  (Zac P J 2003 Trust. The Journal of Financial Transformations CAPCO Institute 17-24)   High trust leads to economic co-operation, which leads to prosperity, which enhances trust in a virtuous circle. Low trust leads to low co-operation leading to poverty and further eroding trust – a vicious circle. Distrustful economies in the lower left are in contrast to the successful economies in the top right. We should all be very afraid if the online world is moving us down to the lower...

Social Media in the Emerging Digitised Economy

Every new communication technology breakthrough, from radio to television, to computers, caused experts to become overly excited about the potential to revolutionise education, entertainment or business.  Visions of replacing expensive people with cheaper machines in these people-dominated economic segments, mostly, were dashed and the early excitement quickly dissipated. Cinema has not replaced theatre, computers have not replaced teachers and, whilst computers are everywhere in business, people still like doing business with people. Where technologies have brought people closer together, they have been embraced; and, where technologies have come between people, as in interactive voice response systems, they were much less successful. It is often felt that we are at a dawn of a new age, and that this moment has...

Generating Profits from Collaboration

Airbnb.com has used the collaborative consumption model to take a resource that would otherwise go unused (an empty bed) and connected the owner of that resource to someone who is prepared to pay for using that resource (a bed for the night). To make this system work sufficient trust has to be created for the provider and user of the resource to be comfortable in undertaking the transaction. Traditional babysitting clubs have now been extended with substantial online services like findababysitter.com.au, which illustrates how communities can share goods and time that are in surplus of requirements, either for a fee or the reward of giving. Online collaboration can go beyond production and consumption of goods and services...

Creating Value from “Digital Waste”

Businesses must think very differently in a digitally enabled economy. Just as Vegemite was created from a waste product in brewing beer, value can be created from digital by-products in the digital economy. Luis von Ahn at Carnegie Mellon brought to the world the squiggly graphic challenge that has been used to distinguish a real person from a computer program trying to access a website. A very useful security service where automated systems could inappropriately access services directed at real people. This service has become extremely popular with 100’s of millions of challenges being issued everyday. Luis recognised an opportunity here to utilise the ‘wasted’ time of these people wanting access to a website by using the security challenge...

Networking did not Begin With Social Media

Dale Carnegie’s iconic book How to Win Friends and Influence People, which has sold more than 15 million copies, is recognised to be one of the most successful self-help books ever published and the title and his name became synonymous with the power of business networking and developing business connections to create valuable business relationships. He was first to define traditional business networking skills covering fundamental techniques in handling people, how to make people like you, winning people to your way of thinking and being a leader. Traditional social interactions relied on participants’ social skills to uncover common interests, shared contacts, shared knowledge and complimentary skills amongst acquaintances. Hence why Dale Carnegie became such a household name in the...

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Altruism in the Digital Age The distinguishing feature of the digital age is the connection of people and things driven by the ubiquitous nature of the Internet. The Internet is connecting billions of people and trillions of devices so that everything is connected with everything else and that will change how people relate and their relationships. Our Increasing Dependence on Others The changes brought about by the digital economy will increase our dependency on others. The fall of Lehman Brothers caused financial pain out the back of Bourke. Drought in one food bowl now causes food riots on the other side of the world.  The essence of power will change as networks become more important than individual people, companies or...