Don Tapscott: Four Principles of an Open World
Openness. This word means prospects and opportunities. Open question, open fire, open resource, open door policy, open bar [jarg. free booze].
The world is opening up everywhere, and that's good.
Why is this happening? The technological revolution is opening up the world.
Yesterday, the Internet was a platform for presenting content. Today the Internet is a platform for computerization. The Internet is becoming a huge global computer. Every time you go into it, every time you upload a video, use Google, do remixes, you are programming this huge global computer that we all use. Humanity is creating a mechanism that allows us to collaborate in new ways. Collaboration can occur on an astronomical scale.
Now a new generation is also opening up the world. I began studying children 15 years ago—20 years ago, in fact—and noticed how my own children handled these intricate technologies with ease. At first I thought, “My kids are child prodigies!” Then I saw that all their friends were the same, so my theory did not come true. I started working with several hundred children and came to the conclusion that this is the first generation that will grow up in the digital age and that is simply awash in information. I call them the Internet generation. These children are different. They are not afraid of technology because it is close to them. It's like air. For example, let's say I'm not afraid of the refrigerator. And there is no greater force to change everything than the first generation of digital natives. I'm a digital immigrant. I need to learn the language.
The global financial crisis is also opening up the world. Our dark institutions of the Industrial Age, everything from the old models of corporations, government, media, Wall Street, are to varying degrees stagnant, frozen, weakened, or even failed. This is creating a crisis in the world. Think about Wall Street. Their basic modus operandi has almost destroyed global capitalism.
You're familiar with the concept of "burning under your feet" when you're in a place where the cost of staying there is higher than moving to some other place, perhaps a radically different one. We need to change and open all our institutions.
So this technological breakthrough, the demographic impulse from the new generation and the requirement to reckon with the current state of the global economy are leading to the world opening up.
It seems to me that we are now experiencing a turning point in history and can remake many of the institutions of the Industrial Age with new principles as the basis.
So what is openness? It turns out that openness has several different meanings, and each fits the corresponding principle of civilization transformation. The first is cooperation. This is where the boundaries of the organization become more cross-cutting, flexible and open.
I'll tell you the story of the man in this photo. His name is Rob McEwan. I would like to say: “We had a scientific tandem, we cleared the world for amazing research.” I know this story because he is my neighbor. He moved into the house across the street and hosted a cocktail party to get to know his neighbors. He said, “You are Don Tapscott. I've read some of your books." I replied: “Great. What do you do?" He said, “I used to be a banker, but now I’m a gold miner.” And he told me this amazing story. He acquires a gold mine and his geologist can't tell where the gold is. He invests more money in geological research, people come back and cannot say where to start production. After several years of torment, he is ready to give up everything, but one day he has an epiphany. He wondered: “If my geologists don’t know where the gold is, maybe someone else does?” And he took “radical” measures. He published the results of geological research and organized a competition on the Internet called the “Gold Corporation Challenge.” The reward was $0.5 million for information about whether there was gold there, and if so, where?
People from all over the world took part in the competition. They used technology he had never heard of, and with $0.5 million in fees, Rob McEwan made $3.4 billion. The company's market value rose from $90 million to $10 billion. As his neighbor, I can tell you he's doing well .
We are used to thinking that talent is within us, right? Your most valuable qualities show up every night. He looked at talent differently. He asked who are the talents? He should have fired his geology department, but he didn't. The best proposals did not come from geologists. They came from computer scientists, engineers. The winner was a computer graphics company that built a 3D model of the mine in which they could lift up part of the surface of the earth and see where the gold was.
He helped us understand that social media is becoming a co-production. This is not about online correspondence. These are new means of production in the process of development. The idealora he created, an open market, an agora, for unique specialists, was part of a change, a major change in the very basis of the structure and architecture of our organizations. This was facilitated by the way he managed the ability to innovate, to create products and services in order to involve the whole world in the process; in the language of the state, how it created public value. Openness is collaboration.
Secondly, openness is transparency. This is a little different. Here we are talking about the connection between relevant information and the organization's stakeholders: employees, customers, business partners, shareholders and so on.
Everywhere our institutions are becoming naked. People are going crazy about WikiLeaks, but that's just the tip of the iceberg. People have information, everyone, not just Julian Assange, has these powerful tools to find information about what's going on, to learn, to inform others, and even to shape public response. Institutions are becoming naked, and if you have to be naked, there are some consequences that come with it. For example, the fact that fitness becomes mandatory. Do you understand? If you're going to be naked, it's best to pump up.
By pumped up I mean having value, as value has never been more apparent. You say that you have good products. And it’s better that it’s really good. But value is also necessary. Integrity needs to be at the core of everything, to become the DNA of the organization, otherwise trust cannot be achieved, and trust is the sine qua non of this new online world.
And this is good. Nothing bad. Sunlight is the best disinfectant. We need a lot of sunshine in this confusing world.
The third meaning and, accordingly, the principle of openness is the exchange of information. This is not the same as transparency. Transparency implies the availability of information. The exchange is associated with the renunciation of claims to ownership and intellectual property.
There are all kinds of stories on this topic. IBM gave away $400 million worth of software to develop Linux, and it brought them billions in profits.
Our normal logic says, "Hey, our intellectual property belongs to us, and if someone infringes on it, we'll call our lawyers and they'll sue them." It didn't work with the record companies, did it? They had technological problems, and instead of committing to an innovative business model to deal with it, they took the legal route, and the industry that brought us Elvis and the Beatles is now suing children and very close to collapse.
We need to look at intellectual property differently.
I'll give you an example. The pharmaceutical industry is in big trouble right now. First of all, there are no major discoveries on the way to production, and this is a big problem for the health of humanity. But the pharmaceutical industry has a bigger problem. It may soon fall off the so-called “patent cliff.” Do you know what this is? They will lose 20 to 35% of their revenue in the next 12 months. What to do, really save on paper clips? No.
We need to completely change the model of scientific research. Pharmaceutical companies should invest in community projects. They need to start sharing pre-competition research. They need to start sharing the results of clinical trials, and thus create a wave that will lift all boats, not only in their field, but throughout the world.
The fourth meaning of openness, and corresponding principle, concerns empowerment. I'm not talking about maternal instinct. Knowledge and education are power, and as they spread, there is a concomitant proliferation, decentralization, and disintegration of power that we see today. The open world brings freedom.
Take the Arab Spring. The debate about the role of social networks and society has already calmed down. Just one word: Tunisia. It all ended in other words. But during the revolution in Tunisia, new media were not the cause of the revolution; the reason was injustice. Social media didn't create a revolution; it was created by a generation of young people who needed work and hope, who no longer wanted to endure inhumane treatment.
Just as the Internet reduces the cost of business transactions and cooperation for business and government, it also reduces the cost of disagreement, rebellion, and even riots; and people don't realize it.
During the Tunisian revolution, snipers associated with the old regime killed unarmed students in the streets. Students would take their cell phones, take photos, locate the location, and send the photos to friendly military groups who would come and catch the sniper. Do you think social networks are needed for online correspondence? For these children, it was a military tool that the unarmed used to protect themselves from murderers. It was a means of self-defense.
Right now, as we speak, young people are being killed in Syria. About three months ago, if something happened to you in the middle of the street, an ambulance would pick you up, take you to the hospital, and you would arrive there with, say, a broken leg, and leave with a bullet in your head.
These young people created an alternative healthcare system using Twitter and other public services so that if they were injured, they could call a car to pick up the victim and take him to a makeshift medical center where he would receive medical care instead of being killed. This is a time of great change.
And not to say that everything is smooth. Up until the last two years, all revolutions in human history had a leader, and when the old regime fell, that leader and his organization took over. These wiki revolutions happen so quickly that they create a vacuum. Politics despises vacuum, and it can be filled by unsavory forces, usually the old regime, extremists or fundamentalists. This is currently unfolding in Egypt.
But it doesn’t matter, because everything will pass. The train left. The genie is out of the bottle. The horses ran out of the stall. How else, help? The toothpaste has squeezed out of the tube. I want to say that there is no turning back. The open world brings empowerment and freedom.
I think at the end of these four days you will come to the conclusion that this is a positive turn in history, it leads to openness.
Go back a couple of hundred years, you will see that the whole world was very closed. The world was agrarian, the means of production and the political system were called feudalism. Knowledge was concentrated in the hands of the church and high society. People didn't know much. There was no idea of progress. You were born, lived your life and died.
But then Johann Gutenberg came along with his great invention, and after a while the society opened up. People began to study things, and when this happened, the institutions of feudal society stagnated, froze, or collapsed. What is the point of the church taking over medicine if ordinary people knew everything.
Thus the Reformation took place. Martin Luther called the printed press “God’s highest virtue.” Corporations, research centers, universities were created, and eventually the Industrial Revolution occurred, and all this was good.
But I also had to pay for it.
Now again the technological genie is out of the bottle, but this time everything is different. The printed press gave us access to the written word. The Internet allows us to be producers. The printed press gave us access to the repository of knowledge. The Internet gives us access not only to information and knowledge, but also to the intelligence of other people on a global basis.
For me, this is not the information age, but the era of networked intelligence. This is a promising era, an era of cooperation, where the boundaries of our organizations change, become transparent, and sunlight disinfects civilization, an era of exchange and awareness of the new power of public knowledge, this is an era of opportunity and freedom.
Now I would like to share with you the research I am working on. I've studied all kinds of organizations to predict what the future will look like, but lately I've been studying nature.
Bees gather in a swarm, fish in schools. Starlings in the boroughs of Edinburgh, England's hunting grounds, gather in an act called "murmuration", which is associated with the rustling of their wings. Throughout the day, within a radius of 30 km, rooks go about their business. But by night they come together and form one of the most amazing phenomena in nature, which is called “murmuration”. Scientists who studied it stated that they had never observed any accidents. It all has a function. Bird protection. Look to the right, the predator is being driven away by the whole team, obviously this is quite scary if you are hunting rooks. Leadership is present, but there is no individual leader.
Is there some kind of analogy to this, is there anything we can learn from this? This phenomenon allows us to capture a number of principles, and at their core these are the same principles that I told you about today. This is a large-scale collaboration. Openness, sharing all kinds of information, not only about location, trajectory, danger and so on, but also about food sources. This is a true understanding of interdependence because individual birds recognize that their interests are the interests of the collective.
We also need to understand that it is impossible to succeed in business if the world is falling apart.
I look at this and it gives me hope. Think about the young people of the Arab Spring, you will notice something similar.
Imagine, just think about this idea: what if we could connect to this world through a huge network of air and glass? Is it possible to go beyond the simple exchange of information and knowledge? Can we start sharing intelligence? Can we create a collective intelligence that goes beyond the individual, the group, the team, to create perhaps consciousness on a global level? If this is possible, we could cope with the world's serious problems.
Look at this, it makes me very excited to think that this smaller online open world our children will inherit could be better; that this new era of networked intelligence may be an era of promise fulfilled and danger unrealized.
Let's do that. Thank you.
Translation: Anastasia Gurova Editor: Alexander Avtaev
Source
Seven principles for building a blockchain economy
Don Tapscott and Alex Tapscott analyzed programs, services, business models, markets, organizations and even governments operating blockchain.
We identified patterns and formulated 7 principles on which followers of the technology rely. Network integrity
Trust arises from within the system, it is not dictated from the outside. Participants perceive the 4 dimensions of trust as a whole. They are honest in word and deed, respect the interests of others, are ready to be responsible for the consequences of their actions, and their decisions are transparent. Integrity is encoded in each step of the process and is distributed among all participants, rather than belonging to one. Participants exchange values in the belief that others also share a holistic approach. It is either impossible to ignore this principle, or “it will become more expensive.”
Load distribution
Energy costs are distributed throughout the peer-to-peer network. There is no one switch. Neither participant can turn off the system. If a central authority blocks a person or group, the system will continue to operate. If about half the network tries to take control of the entire network, the rest will see what's happening.
Value as an incentive
The system aligns the incentives of all stakeholders. Satoshi programmed the application in such a way as to reward those who develop the program. In the 1990s, the Tamagotchi electronic toy was popular among girls. The device represented an alien egg. When activated, a baby of an unknown domestic animal appeared from the egg. The task was to look after him. According to Satoshi's idea, the network looks like a global Tamagotchi. The task of the participants is to protect and develop it. In this case, they can count on a reward. An active network user receives 50 bitcoins for each completed block after 4 years. After the next 4 years - 25 bitcoins, then 12.5, etc.
Safety
Every participant in the network must use encryption. Security measures are built into the network. They provide privacy and authenticity. The user has two keys: one for encryption, the other for decryption. The method is called “public key infrastructure” (English acronym - PKI). Bitcoin today is the largest project in the world to implement the PKI methodology.
Privacy
People need to be in control of their data. People should have the right to decide what information, when, how and to what extent to disclose about themselves. Since one of the principles of blockchain is trust, you no longer need to identify others in order to interact with them. You do not need a name, email address or other personal information to download and use the Bitcoin app.
Security of rights
The rights of owners are transparent and secured. Individual freedom is recognized and respected. Recording the timing of a transaction and PKI not only eliminates double spending, but also secures ownership of every Bitcoin on the network. We can only trade what belongs to us. Besides Bitcoin, it can be any value, including intellectual property.
Engagement
The economy works better when it works for everyone. This means lowering the barrier to entry. Which means creating platforms for distributed capitalism rather than redistributed capital. Satoshi created a system that runs on top of the Internet stack (TCP/IP). However, if necessary, it can work without the Internet. All you need is a mobile phone. You don’t need a bank account, a passport, registration at your place of residence, or a currency that is freely convertible. Anyone with a cell phone can participate in the market as a producer or consumer. Satoshi proposed a method of “simplified payment verification” (English acronym - SVP).
How the financial sector will change
Father and son Tapscott propose eight points of financial sector disruption as a result of blockchain adoption. Let's take a look at their forecast. Let's focus on five aspects.
1. Identity authentication. Today, it is the responsibility of the bank to verify identity to provide access to accounts. Blockchain technology allows transactions to be carried out without personal identification. However, network participants can enter identity verification.
2. Transportation of valuables. The financial system moves money around the world, making sure that not a single dollar is spent twice. Now imagine you have a container in which you can transport goods. Blockchain is a container in which you can transport any value: money, shares, bonds, ownership rights. It can become a standard for the transfer of value. You will strive to reduce costs, reduce the price of services, and increase delivery speed.
3. Storage of valuables. A financial institution is a repository of what is valuable to an individual, organizations, and government. The bank offers safe deposit boxes, checking and savings accounts. A person is no longer required to contact the bank in order to use these services.
4. Lending. Financial institutions are actively issuing loans. For the purchase of a car, repairs, education, mortgages, corporate, municipal and government bonds. The credit business has spawned additional services, for example, borrower scoring, credit rating of organizations, and collection agencies. Blockchain network participants can borrow money from other participants directly. This will increase the speed of obtaining a loan and the transparency of the transaction.
5. Investing. Typically, attracting investments requires intermediaries - investment bankers, venture capitalists, lawyers. Blockchain automates many of the functions of intermediaries. New peer-to-peer financing models will emerge. Accounting and payment of dividends will become more efficient, transparent and secure. In the case of charitable projects, technology will help control the targeted use of collected funds.
In 2010, a strong earthquake hit Haiti. The magnitude 7 ground shaking killed 300,000 people. Haiti is one of the poorest countries. The global community donated $500 million to the Red Cross to help those affected. However, it later turned out that the money was never spent on the needs of the islanders. Blockchain technology will help provide assistance.
Additional benefits of blockchain
Easier and cheaper to search
How do we find the information and people we need? We use Google, Yandex. How do we determine that people, products, services meet our needs? Read reviews, watch videos. Now imagine a search in the global ledger. Who sold what discovery to whom and at what price? What are the qualifications of the doctors in this hospital? Who is the most reliable supplier in China? The answers to these questions are no longer resumes and advertising links. This is a transaction history, a confirmed chronicle of real transactions between network participants, supplemented by a reputation rating.
Product quality is under control
Tell me, when you buy meat, are you sure that the animal was fed the right food and the medications were used in the right dosage? In life, we have very little control over what we eat. Blockchain will show itself here too. Information about the origin of food products and their movement through the supply chain will be available to the buyer. The distributed network will store information not only about each bull, but potentially about each piece of meat, and even with information about the animal’s DNA. Using 3D search, the buyer will see the entire backstory of the steak on the plate. Blockchain will help you choose high-quality and safe products.
