Messages Metaphors 2

MESSAGES, METAPHORS, AND LOOKING FOR LOVE:
THE INTERNET, YEAR 2000 (AS OF MAY 24)

Continued...

James R. Rosenfield

April 2002

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11 WATERSHED EVENTS OF YEAR 2000 (AS OF MAY 24)

1) Whoops! Shards of bubble descend upon us, as laws of economic gravity assert themselves. Maybe by the time this article appears, the NASDAQ and tech stocks will have bounced back. That would be great, in fact, not least for me! But at the time of this writing, the pure-play dotcom game seems to be over, with "bricks and clicks" now the flavor of the month--or maybe year.

Far be it from me to give investment advice, but the e-commerce outfits most apt to survive are likely to be the big brands who are willing to embrace the new technologies, and the new companies--Priceline might be an example--who do something that can't be duplicated in the physical world.

2) Bricks and clicks: Interpenetration. Marshall McLuhan points out that media go through a growth spurt when a new medium and an old medium combine. He calls this "interpenetration." For example: 72% of U.S. radio commercials are now direct response, a result of a new medium (cell phones) interpenetrating the old medium (or space) of radio drive time. The old medium of movies interpenetrated the new medium of TV, which became the major distribution channel for movies, able to accommodate both conventional films and those made expressly for broadcast.

The Internet doesn't replace physical reality, it complements it. Big brands and big stores are now getting smart about the Internet, recognizing that a new medium doesn't render old media obsolete--it changes the role of the old media. So the grocery store is now the place you go to buy meats and produce, but you use the Internet for staples and packaged goods. You bank on-line until you need to talk to someone about your pension plan, and then you go into a branch, which is now located in a supermarket, rather than a freestanding brick and mortar edifice.

3) AOL/Time Warner Merger: Interpenetration, again. Another example of interpenetration, this time old media and new media, in the largest sense of the word, including content. McLuhan said that the message of every medium is another medium. If so, the message of Time Warner content can well end up being the continued conventionalization of AOL, already the Internet's equivalent of apple pie and motherhood. This is the economic version of Herbert Marcuse's concept of "repressive tolerance," AOL effectively colonizing the wild and threatening terra incognita of the Internet.

If you're thinking clearly, you have to be disturbed at the implications of this merger. There's too much message/media mass here to be healthy, and in fact one of the dramas of the next few years will be the concentration and therefore control of so much "information" on the part of multi-national behemoths, beholden to no one but their shareholders. "News" is already managed, controlled, and distorted to a fare-thee-well. What a pity if the anarchic, anything goes Internet ethos rumbles down the road of pure post-industrial capitalism, never to return. (In 1993, Bob Dylan said "Technology to erase the truth now exists. Wait until the cost comes down!")

4) DoubleClick: Privacy (echoing into Census reaction). This was a big one, the first time Americans really got upset en masse about privacy. DoubleClick, you might recall, wanted to crossmatch email addresses against physical addresses, building a dynamite (in both senses of the word!) database. A more-or-less spontaneous consumer rebellion occurred, and DoubleClick backed off.

An echo of this event took place soon afterwards, when Americans became shy about filling in their census forms, particularly the long form, with its intrusive questions.

This is taking place in a world where the U.S. Direct Marketing Association is still trying to persuade its members to offer opt-out! Beware, my friends: The privacy apocalypse in the U.S. is only a matter of time, unless the Federal Government saves us from ourselves. And we're in pretty bad shape if we need the Feds for salvation!

5) Big 3 Auto Makers et al: Disintermediation, transparency. Daimler-Chrysler, General Motors, and Ford--the 3 Horsemen of the Industrial Age--got together and decided to do all of their parts purchasing on the Internet. This represents about $350 billion a year, according to the press. It also represents the ascendancy of the Internet in the business-to-business sphere, which is where e-commerce action is likely to be over the next few years.

This is also an example both of disintermediation, and of pricing transparency. Inventories and delivery times are all on-line, there are no salespeople, and (theoretically) everyone can price dynamically, based on fundamental principles such as supply and demand, and just-in-time delivery.

Out go the schmoozing, the boozing, and the old boys network.

Other industries, including packaged goods firms, are following suit.

6) Supreme Court's ruling on Microsoft: Faster elimination of early stage technology's brittle interface. Early-stage technologies have brittle interfaces, and a specific vocabulary. (We touched on this above.) The first automobiles had to be cranked to start, and people said "Let's drive in the motorcar and visit Grandmother." When key ignition eliminated the brittle interface, people said "Let's visit Grandma." When the interface becomes simplified, the technology drops out of the language. "Let's drive in the motorcar and visit Grandmother" is structurally the same formulation as "Let's boot up the PC and surf the Internet."

The personal computer, with its keyboard, mouse, and Windows software, is a classic example of a brittle interface. The secret to interface simplicity, to paraphrase MIT's Nicholas Negroponte, is to make the interface disappear. Microsoft has been a force of resistance. Microsoft doesn't like the Internet, and in fact was dragged into the Internet world kicking and screaming. On the Internet, you can download software for free, which is somewhat threatening to Microsoft's core business.

We now have non-PC Internet access devices on the market, but they're essentially stripped-down PCs. Next there will be a button to be pushed, and after that Voice Recognition (the technology is there, but the price has to come way down.). After that: the Internet distributed through screens plural (rather than a screen) and through non-screens, e.g., the silicon-chipped doorknob that will open and close the door on voice commands, just in time for arthritic old Baby Boomers to benefit!

7) Cisco market cap exceeds Microsoft: Internet more important than software. Yes, Bill, the Internet is more important than software, and the Street took notice! Software itself (at least as we now know it) is an early-stage manifestation, having to be written, downloaded, rewritten, debugged (inadequately, in the case of Windows 2000!), and coped with. You don't need to download software when you drive a car, do you?

8) Stephen King novel: First mass Internet publishing bestseller. It wasn't Saul Bellow, and it wasn't top-drawer Stephen King for that matter, but it did get lots of readership. It will be part of the future history of the Internet.

Reading extensive text on the screen gives one a headache. Nicholas Negroponte has a vision of downloading texts into a book or newspaper-like device, which would give you the fluidity of the Internet along with the tactile comfort of the printed form.

9) AT&T: Full-speed, traumatic conversion from phone company to Internet company. CEO Michael Armstrong is betting the company on a transformation from a tired old long distance carrier to the main source of broadbanding in the U.S. This is urgently important, to say the least, both for AT&T and the Internet. The faster T1 (and DSL, for that matter) can penetrate U.S. households, the faster the brittle interface will disappear. When the Internet is on, as opposed to being dialed up, the effect and affect of the technology changes dramatically. If you've switched from dial-up to DSL, for example, you know what I'm talking about.

10) Ford gives all employees free home PCs. We're such business boosters here in the U.S.! It's one of our strengths (hey, nothing wrong with being rich and powerful!) and one of our weaknesses (there's a lot wrong with buying into business hype and propaganda).

The mainstream press has greeted Ford's generosity with hosannas, and fails to see the other side of the equation. Yes, Ford is being generous, but there are strings attached. What looks like empowerment can also be seen as a mode of social control. With home PCs, Ford may be able to grind extra work out of its knowledge workers, and also keep tabs on people. Remember, the Internet monitors you even more than you monitor it!

11) The Love Bug. What a mess, and what a metaphor! At the beginning of the article, I talked about biological metaphors (like "bug") being used for the Internet, and technological metaphors ("He's hard-wired for success!") being used for human beings.

The Love-Bug, clumsy though it was, is a message from the future, both that far-distant (or maybe not!) future when biology and technology intertwine, but also that nearer future, when we learn for the thousandth time that our creations soon slip out of our control. That's the bad stuff. The good stuff (in a way) is that thousands of people who should have known better opened the virus-infected document, because they were looking--even in the brave new high-tech world of the 21st Century--for love!