Ben Babcock's Reviews > Wikinomics: How Mass Collaboration Changes Everything

Wikinomics by Don Tapscott
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Jun 03, 11

bookshelves: 2011-read, copyright, culture, economics, non-fiction, technology, canadian-author, owned
Read from May 31 to June 01, 2011 — I own a copy

Full disclosure: I received this book for free, though it was on my to-read list already.

I first heard about Don Tapscott on CBC's Spark, where Nora Young interviewed him about the Net Generation and "digital natives." They also have an interview about MacroWikinomics, the sequel to Wikinomics, which I will be reading soon.

Tapscott intrigued me. According to Wikipedia, he was born in 1947. Yet he talks about the effects of technology on economy and business as if he were, if not exactly a digital native, then a digital confidant. He has a confidence in the benefits of digital, networked technology that belies the stereotype of the Baby Boomers as a generation that just "doesn't get it." Given any amount of thought, this stereotype, like most others, is quickly seen to be absurd: most of the successful companies Tapscott and Williams cite in this book, not to mention pioneers of the Internet like Vint Cerf and Tim Berners-Lee, were born in the 1940s and 1950s. Age is not the dominant factor in companies' resistance to wikinomics, or change of any kind. It's a willingness to embrace a paradigm shift. Those of us in the Net Generation have it easy, because we have grown up into the Network Age rather than having it thrust upon us.

And that brings me to my first caveat about Wikinomics: this book isn't really for me. I'm not its audience. Tapscott and Williams do a great job explaining their concepts, but they did not consistently hold me riveted. Most of this book seemed very obvious to me, because I grew up with it; I live and breathe it. So I found myself nodding my head most of the time, murmuring, "It's obvious," under my breath. Furthermore, I am not the type of person who would primarily benefit from Wikinomics, because I do not run companies or even work for a company. Although I think anyone could find this book useful and informative, the format is clearly intended for people who might want to implement wikinomics in their own organizations.

If the term wikinomics is not illuminating, the subtitle of the book explains everything: it's "how mass collaboration changes everything." Specifically, Tapscott and Williams contend that the capabilities provided by computers that are becoming increasingly faster and increasingly networked allow companies to leverage the contributions of a massive user/customer base (the consumer turns into a "prosumer," a producer-consumer). Moreover, those companies that do not leverage this advantage will soon find themselves in great difficulty. For Tapscott and Williams, wikinomics is all about reducing costs while remaining profitable in a market where consumers are increasingly connected, increasingly more well-informed about competitors' offerings, and increasingly eager to be involved.

As with many books of its ilk, Wikinomics uses several case studies to make its argument. It opens with Goldcorp, Inc. in 2000 and its effort to revitalize Red Lake mining operations by crowdsourcing possible locations of gold deposits. Goldcorp released its preciously-hoarded geological data online for anyone to access and advertised rewards for people who sent in analyses that located good deposits of gold for them. It worked well: not only did Goldcorp discover some of its most profitable gold deposits ever, but the discoveries happened faster and more efficiently than its traditional R&D process.

Tapscott and Williams tell the same story about IBM, Apache, and Linux. I've heard the Linux story several times now (most recently and more verbosely in Next Generation Democracy ), but the IBM-Apache story was new. Basically, IBM invested a lot of money and people into open source efforts like Linux and Apache. In return, it got the use of these products at a cost much less than that of a proprietary, in-house solution. As early as the 1990s, then, wikinomics already made sense: in order to reap rewards, companies were first giving something away. It seems counter-intuitive, but I don't see how it's any different from the shaving razor model: give away the razor once, sell the blades for life (only now it's "give away the razor once, sell the blades, sell a new razor with more blades, repeat"!).

During their analysis of the open source software movement, Tapscott and Williams made a remark that struck me, as a programmer, as particularly interesting:

To understand this progression, think of the open source software movement as two oncoming waves, with roughly a decade between them. The first wave bought us the plumbing: open source Web servers, operating systems, and the various pieces of code needed to run the Internet.…

The first wave of open source provided the foundation for the really expensive and complex applications that enterprises use to run their businesses. But when it came to the enterprise applications themselves, open source hit a wall. Indeed, for almost as long as software has existed, these enterprise-proof applications have been the preserve of large software houses like SAP, Oracle, and Microsoft. Now that's changing, with a second wave of open source.


What this passage really put into perspective for me is this: I am extremely grateful we have Apache, PHP, MySQL, etc. Oh, and Linux too. I can't imagine deciding I was unhappy with the existing operating systems and choosing to write my own (for fun!). I love programming, but I have no real desire to learn the network innards of Apache or the vast, untamed lands of Linux kernel development. I have real respect for those people who can manage to operate at that level, but Wikinomics reminded me that we are lucky we have all this stuff just waiting to be used! It's true that the "plumbing" of open source continues to develop. Lately I've been reading a lot about the "NoSQL" challengers, such as Apache Cassandra, to the relational database systems. This is still very high-level stuff for me, so I continue to stick with good ol' MySQL—but it's fascinating to watch these ongoing developments in the plumbing. Ten or twenty years ago, a lot of what's available to programmers like me just didn't exist; one had to go and spend money and time to develop it from scratch. Now, one has the option of doing that, and sometimes it's the best solution. However, there also exist resources one can use to bootstrap development, saving costs and time. And those resources exist thanks in part to mass collaboration.

But I digress. You can tell I'm passionate about this kind of thing, though more from the technical side than the economic side. Tapscott and Williams are also passionate, and that brings me to the second caveat: they might be too passionate. I certainly cannot accuse them of failing to communicate their enthusiasm and excitement for their subject matter. Wikinomics has lots of interesting insights into the economics of mass collaboration, but it also contains an unwavering optimism about the changes happening the industry. There are token attempts to address the critics—chapter 10 is devoted entirely to this—and, to be fair, they do refute several of the common challenges to wikinomics and mass collaboration. They make compelling cases about how open source software and digital downloads of culture do not have to mean an end to intellectual property (but they are the same arguments I've seen elsewhere). Regrettably absent from these rebuttals are any that address the growing digital divide or the potential for wikinomics to further degrade the balance of power between consumer and corporation.

Both of these issues have weighed heavily on my mind since I took a Philosophy and the Internet course last term. For my final essay, I defended James Tully's view that the Internet reinforces imperialism and hegemony as the most convincing interpretation we had studied. Tully convinced me that the manner in which the Internet has developed, from its origins in the power grids and communications networks of the dominant, imperialist nations, that the Internet is not the great democratic equalizer we would like it to be. Despite the amazing services springing up around mobile devices in places like Kenya, developing countries are still seriously behind when it comes to Internet access. Indeed, even a place like, oh, say, Canada, has sub-par broadband penetration (I think about the North here, and poor Labrador, and all my friends who live just far enough outside my city that they only have dial-up). So Tapscott and Williams tune that those companies that embrace wikinomics will profit and those that won't will decline is all well and good, but it makes me wonder about those who aren't so lucky to be so well connected. It makes me wonder if this will just exacerbate the digital divide. And while I think, personally, that wikinomics holds great potential for allowing developing nations to help bolster their economies and improve their connectivity to the world, I wish Wikinomics had covered more of that.

In my philosophy class we also discussed "immaterial labour," i.e., production of knowledge and information. If you're on Facebook, MySpace (hah, MySpace…), or yes, even Goodreads, then you're a participant in this labour. If you search using Google, Yahoo!, Bing (hah, Bing…), then you contribute to immaterial labour. We give companies our personal data, whether it's our birthdays and photos and what we did or read last night or our interests, destinations, gift ideas, etc. In return, the companies give us services—but they also use that data for profit. They improve their targeted advertising and improve their offerings, and often they do not compensate us, the providers of that information, for the time we spend. Tapscott and Williams take the rather uncritical line of, to paraphrase, "Participation from mass collaborators will help these companies deliver better products and better services." I'm not so convinced the truth is so simple, and again, it would have been nice to see a more thorough treatment of the dangers of letting companies harness us as unpaid knowledge workers.

Wikinomics is a well-structured, well-written roadmap for the tumultuous present and probable future of economics and corporate R&D in the digital era. Don Tapscott and Anthony D. Williams sometimes grow excessive in their praise for wikinomics or their certitude of its benefits. However, they are absolutely right about one thing: there are no rollbacks here. The infrastructure of our age is such that returning to an insular, closed-door model of competition just will not work. So if wikinomics isn't the answer, and that's always a possibility, then there must be something even weirder and wilder. But that will be the province of companies and people who challenge themselves to innovate. The companies that metaphorically stick their fingers in there ears, continue with the same business practices, and expect different results while implementing no real changes? Yeah, those companies will get left in the dust. Even if you end up disagreeing that wikinomics is the way, Wikinomics provides a good wake-up call and a great starting point for thinking about where our digital future is taking us.

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Comments (showing 1-4 of 4) (4 new)

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message 1: by Chidambaram (last edited Jun 02, 2011 07:13PM) (new)

Chidambaram Annamalai I agree with the part where you disagree on appropriate compensation in return for leveraging off data created by and gathered from the user base. The involved transaction is complicated owing to the both nature of the interaction between humans and web applications itself, and the multitude of ways in which the gathered data may be employed. It seems absurd to oversimplify the issue by ending on a cliched win-win type statement. It strikes me as a surprise that the authors should have treated this point so lightly.

I'm sure there will be another such "wave of enlightenment" where web users will not only regulate what data they choose to share, but also how exactly they may be used. I want to mention here that a lot of work to accomplish this is being done in the subfield of cryptography called secure computation, where participants are able to compute any function, the results of which are available for everyone to see, but without having to reveal to each participant the others' inputs. Noting that most of our private data that is being shared becomes used this way (i.e. in the computation of some summary statistic), it is prudent to engage in a group computation that securely computes this rather than give away our private information in which case, we stand to lose everything. I want to liken this to announcing your vote publicly so that the state can determine who wins the election.

If you are interested in this kind of thing, do check out the (rather readable!) paper by Andrew Yao who first came up with the idea of Secure Computation: http://citeseerx.ist.psu.edu/viewdoc/... (1982)


message 2: by Ben (new) - rated it 3 stars

Ben Babcock Chidambaram wrote: "It seems absurd to oversimplify the issue by ending on a cliched win-win type statement. It strikes me as a surprise that the authors should have treated this point so lightly.

Hmm, I realize now the way I phrased it makes that seem like a direct quotation from the book and is not, only paraphrasing on my part. I have corrected my review.

But yes, they focus more on the potential gains for corporations when it comes to using mass collaboration. I'm hoping MacroWikinomics covers this a bit more. In particular, I think it is important for companies wanting to engage in this type of activity to know about the possible pitfalls and consumer backlashes that can arise—e.g., companies like Facebook and, more recently, TwitPic, are finding people more willing to complain when they implement new "opt-out" changes instead of "opt-in" or alter their terms of service in ways that might adversely effect privacy or ownership.

That's a very interesting paper; thanks for linking to it. I've never considered that problem before. Cryptography fascinates me from a mathematical perspective, but I've never really gotten beyond the simplistic "we'll take the product of two very large prime numbers" method. :D

I would love to see some form of open source public-key cryptography become a standard and a mainstream part of interacting online. By that I mean, it should be easy enough to do that a user doesn't have to think about doing it. It's not difficult to learn how to work with public/private keys, but only in the sense of "not difficult for reasonably tech savvy people." I'm hoping the proliferation of mobile phone devices will help here. Much in the way that you can use your mobile phone as an authenticator for your Google accounts, OpenID, etc., your mobile phone should be able to manage your keys for you and transmit them automatically when required.


message 3: by Chidambaram (new)

Chidambaram Annamalai Contributors to open source projects have been using GNU GPG (public key cryptography software) in mailing lists for many years now.

I used to have a GPG key myself, but hardly anyone ever takes the pain to use my public key to encrypt messages before sending them to me, so I just stopped using it. I suppose for our purposes it is really overkill to communicate using some military grade 2048-bit RSA. But I am sure though that a lot of people who should be using it don't, because they don't know about GNU GPG. For instance, I am very confident that many business people (if not entire business) ought to use it. How many times have you seen an email with a footnote "If this email was not meant for you please delete it immediately as it contains sensitive, confidential company information blah blah.." where they weakly rely on human judgement instead of using standard crypto tools.

It's still very popular in development though owing to the fact that the contributors are otherwise completely anonymous, and the only way to identify if it's still the same person is by proving access to the private key. In git, it is common for accepted patches to be "signed-off" by the maintainers, which can be verified by others using the public key of the signer. This is the digital signature which I like to think of as the "dual" of encryption, because here we combine the private key and the text, instead of the public key and the text as in encryption. Consequently, we use the public key to verify a digital signature, and a private key to decrypt the encrypted message. It works out rather neatly!

I think the software itself is very mature, but I would still not think it easy for lay-persons to use it since it doesn't make a very good job of hiding the details. That is to say, using the software entails understanding how public key cryptography works, how to build a web of trust, what digital signatures are, etc., not that each of those things are hard, but there is value in keeping things simple if the intention is to get a lot of people to use it.

Also PK crypto is computationally intensive. Mobile phones today are very powerful, but still having them constantly engage in such communication might drain the battery a lot faster, which could be a concern especially if you didn't care so much about encryption so much in the first place. OTOH, we really cannot wait for anyone to induce us into using it, because companies, and governments would much rather not have us use any form of cryptography so that they can tap into our conversations as and when they please.


João Roberto great review


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