Tuesday, 21 April 2009

The web is inherently social-ist

-- noun
1. a theory or system of social organisation that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole.

2. refers to a broad set of economic theories of social organisation advocating public or state ownership and administration of the means of production and distribution of goods, and a society characterised by equality for all individuals, with a fair or egalitarian method of compensation.

3. a system of society or group living in which there is no private property or condition of society in which the means of production are owned and controlled by the state.

= which all sound like SOCIAL MEDIA and Web 2.0 to me.

Therefore, is the internet inherently a socialist 'state'? Can it be a capitalist one? Can people genuinely reap financial benefit out of it? Can networks be monetised? Can people's social interaction actually be monetised online? Are community managers the new facilitators? Is society now owned by its users?

Is capitalism dying because of the internet?


  1. You've got it in one Kate.

    I wonder why their model seems so hard for other organisations to replicate or adapt. I wonder why it has taken other organisations so long to change their mindset that they can't continue to operate in the way they have been.

    Although it shows promise, I think Twitter is too one dimensional to follow in Google's footsteps.

    It will be an interesting couple of years ahead to say the least.

  2. You're making the assumption that a socialist system can never make any money. I'm not sure that's true. Maybe the internet makes socialism more practical.

    On the other hand, no shortage of marketers and entrepreneurs on twitter.

  3. Thanks for the comment David, and true - I'm sure the system can make money such as Kate's suggestion of Google.

    I guess we've just kissed this whole inflated overtly-capitalistic 90s and early 00s thing goodbye though.

  4. I find it easy to hold two different views on this topic:

    1. The Internet as a tool of democratisation, a great equaliser, where the community has control of the means of production as a result of the very low barriers to entry.


    2. The Internet as a tool of control by Governments and corporations, which actually isolates those communities that hold an opposing view leaving them open to alienation, annexation, control and censorship.

    On a separate but related point, I often wonder if technology is fundamentally classist.

    Topics worthy of much great discussion and investigation than they currently receive methinks.

    Nice post...

  5. Hi Kate,

    Great post, a great thought starter, and one that I've given a lot of thought (as someone with a strong political interest, and an Economics degree).

    I would suggest that the internet is exactly the opposite to a socialist state - it is clearly a capitalist / liberal / libertarian setup - far from a socialist space.

    Socialist states advocate a formal organisation of resources (as per your definition) - someone, either a person or a government at the top, deciding where scarce resources are allocated, deciding the direction of policy and outcomes - for the "good" of the community. There is no internet / social media Government. There is no "organisation" of resources - there is no person saying: "there are too many social media blogs, and not enough blogs discussing the plight of xxxxx", and directing resources into that area or restricting existing activity. There is no overarching control over internet content, and online discussion.

    This is in stark contrast from any such definition of free markets (and the internet), where the "invisible hand" of people acting in self interest drive outcomes without any "collective" goal - but for a collective benefit. It is the free market and free people that decide EVERYTHING online.

    To paraphrase Adam Smith (and update his words for a Web 2.0 era), "It is not from the benevolence of the blogger, the online advertiser, or the click-through customer that we expect our dinner, but from their regard to their self-interest, and never talk to them of our own necessities but of their advantages."

    Let's look at what we "classical liberals" or "free marketeers" classify as the perfect free market. It has the following elements (from the Wikipedia entry):

    Many buyers/Many Sellers – Many consumers with the willingness and ability to buy the product at a certain price, Many producers with the willingness and ability to supply the product at a certain price.

    Con note: The internet has this - a global market. Social media means there are many contributors and many consumers.

    Low-Entry/Exit Barriers – It is relatively easy to enter or exit as a business.

    Con note: This is one of the foundations of the internet and of social media. Everyone's got a voice, a mouse and a wallet.

    Perfect Information - For both consumers and producers.

    Con note: the internet / social media has this - in spades. From Froogle to measurement to sites such as OzBargains, it is far more transparent than existing "real life" markets. Ask an opinion on a product - and you've got 100 answers in a day.

    Firms Aim to Maximize Profits - Firms aim to sell where marginal costs meet marginal revenue, where they generate the most profit.

    Con note - The internet definitely has this. People aim to maximise their information, their decisions, their outcomes - "markets are conversations".

    Homogeneous Products – The characteristics of any given market good or service do not vary across suppliers.

    Con note - if we look within markets for particular products, then we can definitely tick this box. Links are universal!

    So therefore, I would strongly argue that the internet, and in particular individual participation of social media, is almost a textbook example of liberal / free market structure.

  6. Amazing and comprehensive response Con. Appreciate the time you took to reply and you obviously know your stuff.

    If I was a comment, I would want to be yours.



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