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Acquiring digital wealth - the underlying cultural principles

Ubiquity, Volume 2000 Issue March, March 1 - March 31, 2000 | BY Jeremy J. Shapiro 


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There is no obvious pre-computer, pre-network analogue to the relationships that currently obtain between programs and subroutines, between clients and servers, between message-exchanging digital objects, or between intercommunicating software agents. Nor is there anything in the pre-digital world corresponding to the free, perfect, digital copy. That is why it should not surprise anyone that the economic relationships in which these are embedded have some unprecedented features, nor that economists are trying to formulate these as principles for business and for policy (as Carl Shapiro and Hal Varian do in their 1999 book Information Rules: A Strategic Guide to the Network Economy, published by the Harvard Business School Press).

On a more modest scale than these systematic efforts, we shall look here at a few of the underlying cultural principles of the information economy that have direct revenue-bearing implications. For much of the money to be made in the digital economy is at the point of intersection of technology, culture, and the psyche: in other words, in the creation of information needs. The entire edifice of the information economy is sustained on a base of information needs: needs powerful enough to be expressed in the marketplace through the willingness to plunk down some plastic (in e-commerce, uploading credit card information should perhaps lead us to speak of "plunking up" some plastic). But what are these needs? What are the keys to generating durable needs that convert to the ongoing outlay of money? How can information entrepreneurs -- whether independent or in the employ of institutions -- turn their resources into wealth in the digital economy? Here we shall limit ourselves to only four of the principles involved.

The Simulation is the Stimulation

Computer scientists know that the driving force in computing is simulation: developing better algorithms and data structures to represent real-world processes as virtual machines. But computers would have limited impact on consumer goods were it not for an as yet inadequately understood trait of the population of advanced industrial society: many of us, when given the choice, seem to prefer simulations to reality. We prefer Astroturf to grass. We prefer ATM machines to bank tellers. Some of us prefer e-mail relationships to face-to-face encounters, Web-based classes to classroom ones, cybersex to real sex. We prefer what the historian and former Librarian of Congress Daniel Boorstin refers to as "pseudo-events." That is, when we travel, we prefer to pay attention to taking photographs that we can show people when we return than to the things of which they are photographs. We prefer digesting the experience of celebrities on talk shows to having experiences ourselves. Our children are beginning to prefer virtual pets to real ones. Banking on this underlying psychology, it seems that a general guide to making salable information commodities is to use information technology to simulate as many things as you can think of, because a significant subset of those simulations will find eager buyers. Put together an observer of human behavior, a product designer, and a programmer and see what they can simulate. For the computer age, an updated version of Marshall McLuhan's "the medium is the message" could be, "the simulation is the stimulation."

Mining Hypochondria and Old Age

The lengthening of the life-span, the sedentary quality and general unwholesomeness of life in advanced industrial society (regardless of what one might think, only one-fifth of the population engages in regular exercise), the increasingly materialistic, this-worldly value system (regardless of the spread of both fundamentalism and New Age mentality), and the inadequacy of the healthcare system bring about constantly growing preoccupation with health and health care and increasing medical demand. They also lead to a tremendous increase in self-diagnosis, self-medication, and the use of "alternative" medicine and treatment modalities, to national hypochondria, and to billions of dollars of outlay on health products that do not require a doctor's prescription -- or, as we have seen recently, on prescriptions imported illegally after being ordered over the Internet. In recent years there has been a rapidly expanding market for health and medical products designed for self-diagnosis (home tests for diabetes, pregnancy, etc.) as well as those that incorporate computer technology, such as home and portable sphygmomanometers. When combined with the power of the Internet and advanced communication technologies, these constitute a virtual rain forest of potential medical and health products. How about a portable blood-pressure unit with a built-in wireless modem that transmits your blood pressure four times a day to a central computer (or your doctor's)? Or a home diabetes tester that does the same thing with your blood glucose level? How about a doctor's prescription pad with a handwriting recognition capability that transmits the prescription directly to the pharmacy? The possibilities are endless. A good place to start is with one's own hypochondria or that of one's family and friends. What hypochondriacal anxiety could be allayed through digital, wireless, network, multimedia technologies? Another is with the ailments or concerns of one's aging relatives. In one's ideal fantasy, which ones could be helped or ameliorated by these technologies? As long as genetic engineering does not lead to true physical immortality, the market for health-care and longevity products will expand indefinitely, since economic growth and technological progress themselves lead to new sources of stress and disease. The principle "build a better mousetrap" yields to the principle of "build a better mouserest" -- or a better mouse.

The Jerry Springer Principle

For most people in advanced industrial society, there are four sorts of needs: the permanently unsatisfiable (such as for unity with God, attainable only by mystics, or for being the richest person in the world, attainable only by Bill Gates or his replacement), the permanently satisfiable (seeing Titanic, visiting Burbank California, owning a Casio watch), the recurrently satisfiable (eating a hamburger, or any other need that is fully satisfied until regenerated by physiological processes) and the permanently unsatisfiable-though-satisfied: that is, the need for things which by nature can never produce complete satisfaction and which therefore must be consumed again and again in the exciting but frustrating quest for a consummation that remains always just beyond the horizon. This last category, animated by what could be called the Jerry Springer principle in honor of one of its champions, is the most commercially important one in an affluent market society and is the basis for a majority of popular culture and much media content, as well as pornography. From a psychoanalytic point of view, the underlying mechanism of this principle appears to be the promise of satisfying repressed urges -- for sex, for violence, perhaps for information or knowledge -- in such a way that the "satisfaction" stimulates the sense of deprivation, want, or longing. The act of consumption undertaken to allay the desire -- one more expose of infidelity on a talk show, one more pornographic image, one more world champion wrestler bashed on the head with a chair, one more drink, one more Web site -- because it never gets to "the bottom" of the desire, induces a further act of consumption.

It is possible, however, that people actually don't want the ultimate satisfaction, that they pursue this quest out of a desire for the infinite -- "the journey is more important than the destination." In either case, it seems that the commercial future of the information society lies with the proliferation of this sort of "content" and this sort of experience. The trick for respectable information managers at respectable organizations -- although we know from long experience that ultimately wealth breeds respectability, so that we can expect that within a generation there will be a Distinguished Wrestling Professor of Humanities or a Distinguished X-Rated Professor of Psychology at an accredited university -- is to focus on implementations that stay clear of pornography and world wrestling. One time-honored academic way to do this is to develop research centers that focus on such phenomena as pornography and wrestling. That way, the same urge for infinity can be satisfied, but the phenomena have been converted into legitimate academic pursuits. There are certainly precedents for this within the academic and the corporate worlds. And there are certainly non-pornographic, non-wrestling domains of need and desire that also are bottomless, such as the desire for metadata: the index of indexes, digest of digests, the Web site that is a portal to other Web sites, and so on.

The Princess Diana Principle

The late Princess Diana's trajectory through the world, her immense symbolic importance to millions, and the international mourning set off by her death symbolize a vitally significant force in contemporary culture: the desire for something or someone "in" the world that seems to point to something "beyond" it or "higher" than it -- someone that one feels one "almost knows" who functions as an intermediary with the "beyond". True, there is a resurgence of fundamentalist religious belief on a world scale, and religion has even been transferred to the World Wide Web (such as the Web sites for the Pope and the Stations of the Cross) as it has been to television. For millions of people, however, the symbols of traditional culture and religion no longer "work" in an information society. While many pursue "other-worldly" experience in different forms, what people crave is some believable point of contact between their everyday life and the beyond -- what philosophers might call "immanent transcendence". Often indirect participation in the lives of those apparently touched by charisma, grace, innocence, specialness, or just plain celebrity serves to mediate between the two dimensions. Perhaps this explains the proliferation of nominally pornographic Web sites that focus on "nude celebrities" and "nude pix of celebrities." Is it possible that this interest is not a prurient one but rather one that seeks to bring the transcendent down to earth?

What networks and multimedia make possible is interactivity with these mediators between the mundane and the beyond: examples are the Web sites that make possible not only e-mail to but on-line chats with stars and celebrities, "talk back" programs and Web sites, and so on. For information entrepreneurs, the "Princess Diana" principle remains to be explored. Obvious applications are setting up interactive Web sites for local celebrities, arranging guest "visits" to the campus by celebrity lecturers whose appearance consists of participating in a teleconference, creating Web pages that provide access to "transcendent" figures and personalities. As a legacy of the original "free" Internet, charging for such access is not yet the norm on the Web. But already some celebrity sites charge a membership fee. Eventually charging for Web connection to charisma or aristocracy will become coin of the realm. Here again pornography sites are blazing trails that can and will be emulated in other domains. For example, there are Web sites that enable customers to order underwear worn by the stars of X-rated films or customized videotapes of their favorite stars engaging in erotic activities while uttering the customer's name. With slight modifications, the principle at work here could be used to sell objects or media associated with non-pornographic celebrities: T-shirts worn by sports stars, printer cartridges used up by famous writers, etc.

In principle, managers of information technology and information systems have as their responsibility harnessing their institutions' IT and IS resources to institutional missions and objectives. But at a time when the institutions, their IT/IS departments, and the managers themselves are strapped for funds (especially in the educational and non-profit sectors), it is appropriate for a manager to think proactively, creatively, and pecuniarily about enrichment as a legitimate goal. For the right investment of information capital can expand simultaneously the institution's resource base, the departmental budget, and one's own personal wealth. It is unlikely that anyone else in the institution will understand as well as the IT/IS manager the peculiar wealth-building properties of the information infrastructure and be able to envision as she or he can their economic potential. That is why it is both a personal and institutional responsibility of the information manager to think about how to use the information resources under her control to make a fast or slow buck. This is a situation in which personal interest and professional loyalty coincide, and in which the principles of digital wealth and status will help turn that mercenary twinkle of the eye into viable income-bearing projects. And, through a recursive twist of the sort that is dear to the heart of the computer scientist, these projects will provide further insight into the truly distinctive economic principles governing the digital, virtual economy and its commodities.

Jeremy J. Shapiro is Professor of Human and Organization Development and Senior Consultant on Academic Information Projects at the Fielding Institute, has worked as a computer professional, and does research on the social and cultural impact and context of information technology.


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