Tunisia’s People Power: A Combination Of Creative Destruction And The Politics of Obedience

The New York Times reports,

The fall of Mr. Ben Ali marked the first time that widespread street demonstrations had overthrown an Arab leader. And even before the last clouds of tear gas had drifted away from the capital’s cafe-lined Bourguiba Boulevard, people throughout the Arab world had begun debating whether Tunisia’s uprising could prove to be a model, threatening other autocratic rulers in the region….

Because the protests came together largely through informal online networks, their success has also raised questions about whether a new opposition movement has formed that could challenge whatever new government takes shape. (emphasis mine)

This represents another validation of our prediction when I wrote,

The growing friction between technology and the old political society is definitely taking shape; eventually one has to give. My bet: creative destruction will win.

Aside from the first People Power at an Arab nation where the changes in the political order appear to be significantly influenced by the rapidly diffusing adaption to connectivity based technology platforms, the Tunisian experience suggests that People Power as a political concept as presciently advanced by the founder of modern political philosophy in France, Etienne de la Boetie, will become more accepted from the grassroots levels or become more widespread globally as more people will learn about their inherent power over governments.

To quote Etienne de la Boetie in the Politics of Obedience

Obviously there is no need of fighting to overcome this single tyrant, for he is automatically defeated if the country refuses consent to its own enslavement: it is not necessary to deprive him of anything but simply to give him nothing; there is no need that the country make an effort to do anything for itself provided it does nothing against itself. It is therefore the inhabitants themselves who permit, or, rather, bring about, their own subjection, since by ceasing to submit they would put an end to their servitude. A people enslaves itself, cuts its own throat, when, having a choice between being vassals and being free men, it deserts its liberties and takes on the yoke, gives consent to its own misery, or, rather, apparently welcomes it.

In short, people power and the web would make a mighty combination over the tyranny of governments.

So governments will try to fight these via the introduction of regulations and control of the web which would limit the democratization of information.

As one of the five things we should worry about in 2011 Cato’s Dan Mitchell rightly observers, (bold emphasis mine)

The Federal Communications Commission just engaged in an unprecedented power grab as part of its “Net Neutrality” initiative, so we already have bad news for both Internet consumers and America’s telecommunications industry. But it may get worse. The bureaucrats at the United Nations, conspiring with autocratic governments, have created an Internet Governance Forum in hopes of grabbing power over the online world. This has caused considerable angst, leading Vint Cerf, one of inventors of the Internet (sorry, Al Gore) to warn: “We don’t believe governments should be allowed to grant themselves a monopoly on Internet governance. The current bottoms-up, open approach works — protecting users from vested interests and enabling rapid innovation. Let’s fight to keep it that way.” International bureaucracies are very skilled at incrementally increasing their authority, so this won’t be a one-year fight. Stopping this power grab will require persistent oversight and a willingness to reject compromises that inevitably give bureaucracies more power and simply set the stage for further demands.

How Videogames Flourish Under Free Markets

Former hedge fund Kessler argues that Videogames will inspire many of the most important innovations in the coming years which would overshadow government’s influence.

Mr. Kessler writes, (bold highlights mine)

But without gaming, this technology would be expensive, one-off stuff that never sees much use. Much as keyboards and mice and fast graphics have driven corporate productivity for 40 years—killing carbon paper and Correcto Type—the next decades will be driven by tools that can harness voices and gestures.

All it takes is one application. High-margin industries like finance usually deploy these things first: The early adopters could be traders in commodity pits signaling like crazy folk. The rest will follow.

Videogames will influence how next-gen workers interact with each other. Call of Duty, a military simulation game, has a mode that allows players to cooperate from remote locations. In World of Warcraft, players form guilds to collaborate, using real-time texting and talking, to navigate worlds presented in high-resolution graphics. Sure, they have funky weapons and are killing Orcs and Trolls and Dwarves, but you don't have to be a gamer to see how this technology is going to find its way into corporate America. Within the next few years, this is how traders or marketers or DNA hunters will work together. No more meetings!

Even the entertainment and media businesses will be transformed. In 1985, Neil Postman of New York University wrote a book, "Amusing Ourselves to Death," disparaging the media for ruining discourse. Postman died in 2003, but I wonder what he'd think today: Online ad sales are now more lucrative than newspaper advertising, as marketers follow their customers. Netflix video streaming will change the cable TV business. The videogames Rock Band and Guitar Hero have taught the media how to package something that's at least 30 years old, in this case music you play along with, and sell it as if it were new.

The mass expansion of videogames only reflects on how specialization via technology has swiftly been diffusing into the highly competitive marketplace. The videogames industry today is estimated at $21 billion, according to Venturebeat.com and is expected to balloon to $68 billion, according to arstechnica.com. (includes the graph below)

And part of this growth will come from social network gaming.

According to Red Herring,

Farmville and other social games won't be needing Farm Aide support for 2011. According to a recently released eMarketer report, social gaming will reach a billion dollar business this year.

Not that the techsphere is reeling from the news. Considering the massive growth of Facebook and Zynga platforms for social gaming lately, this impressive statistic is hardly surprising, though it's nice to have the numbers to back it up.

According to the report, nearly 62 million Internet users, making up 27 percent of the online audience, will engage at least one game on a social platform monthly this year, a sizable increase from the 53 million who did so in 2010. US consumers will spend $653 million on social gaming for 2011, a hearty boost from the $510 million they spent last year.

Count me as one of the free riding game players (presently active in Knights of Camelot and Napoleonic wars but am rethinking if I should continue)

I think the idea that video games will serve as one of the most important source of innovation is spot on. That’s because video games seems emblematic of free market forces at work where competition drives innovation through the technology platform, where game developers tap the specialty market segments through various genre of games, which has been rapidly growing along with explosive growth of web usage.

While Mr. Kessler rightly attributes the origins of some of the past technological innovations to the government, it is important to point out that the market, and not the government, has fuelled the widespread use.

As rightly Peter Klein explains, (bold highlights mine)

But technological value is not the same as economic value. That can only be determined by the free choice of consumers to buy or not to buy. The ARPANET may well have been technologically superior to any commercial networks that existed at the time, just as Betamax may have been technologically superior to VHS, the MacOS to MS-DOS, and Dvorak to QWERTY. (Actually Dvorak wasn't.) But the products and features valued by engineers are not always the same as those valued by consumers. Markets select for economic superiority, not technological superiority (even in the presence of nefarious "network effects," as shown convincingly by Liebowitz and Margolis).

In short, those cited figures—billions in dollars—account for as the economic value of these videogames. It’s not just the game, but how people spend for it which sustains and grows the industry and at same time satisfying millions of users.

From the investment perspective, surging video and online social network games seem as one great area to explore.

Technology And The Growing Dysfunctionality Of The Political Institutions Of The Old Order

In the book Revolutionary Wealth, Alvin and Heidi Toffler writes,

``It becomes clear that what America world [strikethrough mine] confronts today is not simply a runaway acceleration of change but a significant mismatch between the demands of the fast growing new economy and the inertial new institutional structure of the old society. Can a hyperspeed, twenty-first century info-biological economy continue to advance? Or will society’s slow paced, malfunctioning obsolete institutions grind to a halt? Bureaucracy, clogged courts, legislative myopia, regulatory gridlock and pathological incrementalism cannot but take their toll. Something it would appear, will have to give. Few problems will prove more challenging than the growing dysfunctionality of so many related but desynchronized institutions." [bold emphasis added]

Some recent examples where such conflict applies (hat tip David Boaz)

From the Washington Post, (bold emphasis mine)

A satellite TV station co-owned by Rupert Murdoch is pulling in Iranian viewers with sizzling soaps and sitcoms but has incensed the Islamic republic's clerics and state television executives.

Unlike dozens of other foreign-based satellite channels here, Farsi1 broadcasts popular Korean, Colombian and U.S. shows and also dubs them in Iran's national language, Farsi, rather than using subtitles, making them more broadly accessible. Its popularity has soared since its launch in August...

Satellite receivers are illegal in Iran but widely available. Officials acknowledge that they jam many foreign channels using radio waves, but Farsi1, which operates out of the Hong Kong-based headquarters of Star TV, a subsidiary of Murdoch's News Corp., is still on the air in Tehran.

Viewers are increasingly deserting the six channels operated by Iranian state television, with its political, ideological and religious constraints, for Farsi1's more daring fare, including the U.S. series "Prison Break," "24" and "Dharma and Greg."

From the Wall Street Journal,

A move by Pakistan to begin monitoring for anti-Islamic content on major websites—including those run by Google Inc. and Yahoo Inc.—is the latest sign that censorship looms as a threat to Internet companies in a number of countries.

The Pakistan announcement on Friday came a day after a communications minister in Turkey, which has blocked thousands of sites including Google's YouTube, said the video site was "waging a battle against the Turkish Republic" and suggested that the situation could change if Google were to register and pay taxes.

Authorities in Pakistan on Friday said they would start monitoring major Internet search engines, including Google and Microsoft Corp.'s Bing.com, as well as the e-commerce giant Amazon.com Inc. The move follows an action last month against social-networking site Facebook Inc., which Pakistan blocked for several weeks after it hosted a page in which users could post pictures of the Prophet Muhammad. The portrayal of Muhammad is forbidden by Islam, and the ban was lifted when the site removed the page...

Earlier this year Turkey's communications ministry extended the ban to other Google sites, a move that appeared to be triggered by a separate tax battle with the U.S. giant. As a result, Turks suddenly lost direct access to GoogleMaps and other sites, as well as to YouTube. However, many ordinary users have been able to circumvent the closures.

The opposition People's Republican Party, usually a fierce defender of Ataturk's honor, on Thursday attacked the government in parliament for creating what one parliament member called a "culture of censorship" in the country, including Internet censorship.

Some of Turkey's top leaders have sought to distance themselves from the Internet closures. President Abdullah Gul earlier this month sent out a public message through his account on micro-blogging site Twitter.com, saying he "cannot approve of Turkey being in the category of countries that bans YouTube [and] prevents access to Google."

The growing friction between technology and the old political society is definitely taking shape; eventually one has to give. My bet: creative destruction will win.

Has Quitting Facebook Been Gaining Steam?

There are some permabears who believe that moods drive people's action. According to this school, negative mood prompts people to cloister or become less open.

And in spotting few instances of people deactivating their Facebook accounts, such permabears declare a generalized trend towards social insulation.


Unfortunately this is simply not true or could be discerned as a fallacy of composition (making mountain of an anthill).

The chart from Nielsen/Marketingcharts.com shows that Facebook has been generating most of the recent gains among social media outfit in the US last March. In addition, the gains of Facebook has surged (and not collapsed) in spite of the 2008 crisis.

Where Facebook has reached more than 400 million members worldwide, see Facebook's statistics here, it would be natural for some among the huge number of people to become discontented enough to prompt them to quit for one reason or another.

But the point is to see whether trends in membership are NET positive or negative. The generalized net positive gains, so far, debunks the negative social mood outlook.

Anyway ABC News has an interesting article about Quitting Facebook.

Power Of Social Networking: President Obama Responds To A Freedom Advocate Blogger

We have written alot about how web based technology have been democratizing information. Its apparent impact appears to be vastly broadening and filtering into the political space.

Recently, Cuba's controversial freedom advocate blogger Yoani Sánchez received a surprise reply from US President Obama. From Committee to Protect Journalist, (bold highlights mine) [pointer from Professor Mark Perry]

``Cuban blogger Yoani Sánchez was astounded this week by President Barack Obama’s decision to respond a written questionnaire Sánchez submitted to the White House. Still recovering from bruises left by a recent vicious attack by state security agents, she told CPJ from her home in Havana: “This is the best way to get better.”

``The blogger said that she had tried for months to reach the U.S. president through different channels. Sánchez said she had sent written questions to Obama through a wide range of different people before the White House responded. On her blog Generación Y, where she has posted Obama’s answers to her seven questions, Sánchez explained that the questions were based on issues “that keep me from sleeping,” and were born from her personal experience.

``“It was a very pleasant surprise,” Sánchez said, acknowledging that the chances that Obama would reply were minimal. Before responding to the questions, Obama thanked Sánchez for the opportunity to exchange views with her and her readers in Cuba, and congratulated her for receiving Columbia’s University Maria Moors Cabot Award for excellence in Latin American reporting.

“Your blog provides the world a unique window into the realities of daily life in Cuba,” Obama wrote. “It is telling that the Internet has provided you and other courageous Cuban bloggers with an outlet to express yourself so freely, and I applaud your collective efforts to empower fellow Cubans to express themselves through the use of technology. The government and people of the United States join all of you in looking forward to the day all Cubans can freely express themselves in public without fear and without reprisals.”

``Sánchez asked Obama questions that ranged from U.S. foreign policy toward Cuba, to the legitimacy of President Raúl Castro and the potential involvement of the Cuban exile community, the political opposition, and nascent civil society groups.

``Sánchez also raised the issue of limited Internet access in Cuba, asking whether the U.S. embargo has anything to do with it. Obama responded by saying that his administration has taken steps “to promote the free flow of information to and from the Cuban people particularly through new technologies.” But Obama warned that this will not have its full effect without action from Cuba. “I understand the Cuban government has announced a plan to provide Cubans greater access to the Internet at post offices,” said Obama. The president urged the Cuban government “to allow its people to enjoy unrestricted access to the Internet and to information.”

Additional comments..

It is precisely such freedom of expression that serves as important barriers against socialism. Yet governments worldwide, despite the pronouncements of President Obama, has taken aim to control or regulate the cyberspace.

Microfinancing Goes Facebook

Microfinancing goes Facebook....but a different version; it's a Facebook for farmers, says James Davison of the World Bank.

Technology has been introducing innovative ways of connecting capital and people. This should lead to more productivity and progress.

From Mr. Davison, (accompanying video likewise from the World Bank)

``Wokai has been dubbed by some as a “Facebook for farmers,” yet it may be more comparable to well-known microfinance sites like Kiva, which allow people with an Internet connection to give loans directly to entrepreneurs in developing countries. Wokai, however, focuses solely on impoverished people living in rural China.

``The site has been around for about two years and says it has raised $45,000 from about 500 contributors. The money has gone to more than 160 rural Chinese entrepreneurs, who put loans to a variety of uses, such as pig farming, furniture making and starting a restaurant.

``The comparison to Facebook is made because individual donors and borrowers have profiles on the site, and contributors can read about (and watch the progress of) the people their loans go to. Casey Wilson, one of the site’s founders, explains more about the organization in this video shot by a reporter based in China." (emphasis added)

Facebook for Farmers from grubbylens on Vimeo.

Stranger, Friendlies or My Friend?

Quote of the day from the ever eloquent and adroit marketing guru Seth Godin-from his latest terse but inspiring missive, The difference between strangers and friends.

(bold emphasis added)

``Strangers are justifiably suspicious.

``Friends give you the benefit of the doubt.

``“Friend” is more broadly defined as someone you have a beer with or meet up with to go on a hike. A friend is someone who has interacted with you, or who knows your parents or reads your blog—someone with history. If you’ve made a promise to someone and then kept it, you’re a friend. If you’ve changed someone for the better, you’re a friend as well.

``We market to friends very differently than we market to strangers. We do business differently as well.

``Thanks to social networks and the amplification of stories online, we have far more friends per person than at any other time in human history. Nurturing your friends—protecting them and watching out for them—is an obligation, and it builds an asset at the same time.

``(I want to distinguish friends from 'friendlies', the people you have a digital link to, but no real connection. Friendlies are basically strangers with a thumbnail of their face on your screen. They're not friends. And, while we're at it, the moment you treat a friend like a stranger (form mail, for example) they're not a friend any more, are they?)"

(end quote)

My comment: Will you be more than a 'friendlies' and be my friend?

Iran's Ongoing Election Drama in Pictures, George Friedman's Take and Social Networks

Boston.com has a fantastic deck of pictures covering the ongoing bitterly disputed post-presidential elections drama.

See first part here Iran's Presidential Election

second part here Iran's Disputed Elections

And third part here Iran's Continued Election Turmoil

Meanwhile, here is Stratfor's George Friedman take on the elections...


Finally, we learned how instrumental or pivotal social networks have been contributing to this unfolding spectacle.

This from the Reuters,

``The U.S. State Department said on Tuesday it had contacted the social networking service Twitter to urge it to delay a planned upgrade that would have cut daytime service to Iranians who are disputing their election.

``Confirmation that the U.S. government had contacted Twitter came as the Obama administration sought to avoid suggestions it was meddling in Iran's internal affairs as the Islamic Republic battled to control deadly street protests over the election result.

``Twitter and Facebook have been used as a tool by many young people to coordinate protests over the election's outcome." (bold highlight mine)

A Booming Blogging Industry!

Speaking of advances in the technology sector, guess what particular field in the said sector has been benefiting from today's downturn?

The answer is blogging.

In comparing relative additions of JOB numbers in the US, bloggers have scored the second in terms of adding employment.

According to Mark Penn in the Wall Street Journal (all bold highlights mine), ``In America today, there are almost as many people making their living as bloggers as there are lawyers. Already more Americans are making their primary income from posting their opinions than Americans working as computer programmers, firefighters or even bartenders.

``Paid bloggers fit just about every definition of a microtrend: Their ranks have grown dramatically over the years, blogging is an important social and cultural movement that people care passionately about, and the number of people doing it for at least some income is approaching 1% of American adults.

``The best studies we can find say we are a nation of over 20 million bloggers, with 1.7 million profiting from the work,and 452,000 of those using blogging as their primary source of income. That's almost 2 million Americans getting paid by the word, the post, or the click -- whether on their site or someone else's. And that's nearly half a million of whom it can be said, as Bob Dylan did of Hurricane Carter: "It's my work he'd say, I do it for pay."

``This could make us the most noisily opinionated nation on earth. The Information Age has spawned many new professions, but blogging could well be the one with the most profound effect on our culture. If journalists were the Fourth Estate, bloggers are becoming the Fifth Estate."

I've never realized that this hobby can have significant income generating potentials or can function as an alternative career.

More from Mr. Penn but with some of my comments interposed, ``Demographically, bloggers are extremely well educated: three out of every four are college graduates. Most are white males reporting above-average incomes. One out of three young people reports blogging, but bloggers who do it for a living successfully are 2% of bloggers overall. [am definitely a long long way to go -comment mine] It takes about 100,000 unique visitors a month to generate an income of $75,000 a year [woah!]. Bloggers can get $75 to $200 for a good post, and some even serve as "spokesbloggers" -- paid by advertisers to blog about products."

Now, at least I have some numbers.

Other benefits of blogging again from Mr. Penn, ``As a job with zero commuting, blogging could be one of the most environmentally friendly jobs around -- but it can also be quite profitable. For sites at the top, the returns can be substantial. At some point the value of the Huffington Post will no doubt pass the value of the Washington Post.

``The barriers to entry couldn't be lower. Most bloggers for hire pay $80 to get started, do it for about 35 months, and make a few hundred dollars. But a subgroup of these bloggers are the true professionals who work at corporations, serve as highly paid blogging consultants or write for sites with substantial traffic.

``Pros who work for companies are typically paid $45,000 to $90,000 a year for their blogging. [wow!-comment mine] One percent make over $200,000. [even more wow!!!] And they report long hours -- 50 to 60 hours a week [more in my experience].

``As bloggers have increased in numbers, the number of journalists has significantly declined [economics is about tradeoffs, so blogs are replacing the dinosaur newspapers, clearly Schumpeter's creative destruction in operation]. In Washington alone, there are now 79% fewer DC-based employees of major newspapers than there were just few years ago. At the same time, Washington is easily the most blogged-about city in America, if not the world.

``Almost no blogging is by subscription; rather, it owes it economic model to on-line advertising. [true-comment mine] Bloggers make money if their consumers click the ads on their sites [readers pls do]. Some sites even pay writers by the click, which is of course a system that promotes sensationalism, or doing whatever it takes to get noticed."

Lastly education directed at the industry underscores growth and is the icing in the cake as a fully blooming industry.

``It is hard to think of another job category that has grown so quickly and become such a force in society without having any tests, degrees, or regulation of virtually any kind. Courses on blogging are now cropping up, and we can't be far away from the Columbia School of Bloggerism. There is a lot of interest now in Twittering and Facebooking -- but those venues don't offer the career opportunities of blogging. Not since eBay opened its doors have so many been able to sit at their computer screens and make some money, or even make a whole living."

From now on, my calling card will highlight as my occupation "BLOGGER"!!!

Wikinomics: The Exploding Growth In Social Networking Media

We are witnessing a growth juggernaut in social networking.

In the US social networking among broadband users have soared by 93% according to a new report from Netpop Research, LLC that delves into social networking trends and habits (Marketing Charts).

And talking, sharing, and providing opinions and perspectives have been taking up the "new" form of entertainment displacing the traditional forms as shown below. (All charts from Marketingcharts.com)

Of the 105 million US users, a big majority or 76% are counted as active participants to social media.

This implies of the sundry roles of contribution: upload audio/video, post to wiki, publish a blog, upload photos or podcasts, publish websites, tag articles or vidoes, post to microblog, send/forward email, live in a virtual world, post to blog or forum, rate or review products, P2P file sharing, publish personal pages...see below

Meanwhile, WEB 2.0 is being shaped at the margins.

Web 2.0 is defined by wikipedia.org as the ``perceived second generation of web development and design, that facilitates communication, secure information sharing, interoperability, and collaboration on the World Wide Web. Web 2.0 concepts have led to the development and evolution of web-based communities, hosted services, and applications; such as social-networking sites, video-sharing sites, wikis, blogs, and folksonomies.”

This means less than 10% of US broadband users are “heavy” social media contributors, concentrating their activities to at least 6 applications- such as blogging, microblogging, social networking and photo/video sharing - and connect with 248 people on a one-to-many basis in a typical week (marketing charts.com).

And which is the most used social networking media?

According to Marketingcharts.com which quotes Hitwise it is still MySpace, ``MySpace accounted for 52.21% of those visits, the highest in the category, despite a decrease in visits of 28% compared with February 2008.” Albeit MySpace appears to be losing out to competitors.

Nonetheless, while MySpace is where Americans spent more time among the most visited media: “with 29 minutes and 38 seconds - though this represents a decrease of 2% compared with February 2008”, the fastest growth was seen in Facebook and Tagged.

Again from Marketing Charts, `` In contrast to MySpace’s negative growth, US visits to Facebook increased 149% in February 2009 compared with February 2008. The site received the second-highest market share of US. visits for the month, with 36.03%. Tagged received 2.47% of visits in February 2009, the third-largest number, and had the largest percentage gain in market share of visits among the top five visited websites increasing 280% compared with February 2008.”

Yet based on demographics, Facebook appeals more to older users…

``Looking at the demographic breakdown of visitors to MySpace and Facebook, users between the ages 18-34 still dominate, as 58.81% and 53.91% of US visits, respectively, came from those combined age groups in February 2009. This represents a 2% growth for MySpace and a 14% decline for Facebook in terms of year-over-year percentages. Visitors to the sites who are age 35+ have increased 23% to Facebook in February 2009 compared with February 2008, while visitors from that age group to MySpace have declined 2%.” reports the Marketingcharts.com

All of these underscores of the exploding social networking business model of Wikinomics (openness, peering, sharing and acting globally). This means that from an investment point of view companies actively exploiting these opportunities could be tomorrow’s bonanza.

Importantly we can take note of additional social networking data from Marketingcharts.com:

Additional findings about Chinese users:

-China has a sizable proportion of social media contributors who participate in many Web 2.0 activities, including blogs, micro-blogs, social media, video and photo sharing

-43% of Chinese broadband users (105 million) contribute to forums and discussion boards.

-Young professionals ages 25-29 are the most active users of social media in China. They use more online modes of communication more often than any other age group.

-37 percent of bloggers, or 29 million bloggers, post to blogs on a daily basis.

-41 million Chinese are heavy social media contributors (6+ activities) who connect with 84 people on a ‘one-to-many’ basis in a typical week.

For Chinese Netizens, Netpop said, social media add exponentially to the sources and perspectives available online and represent a new experience for a country accustomed to a single source for media and information.

A global growth juggernaut indeed.