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This past week I attended the San Francisco Opera’s production of Richard Wagner’s Ring of the Nibelung. For those unfamiliar with this ritual, the work is comprised of four operas: Das Rheingold, Die Walkure, Siegfried and Gotterdamerung. They tell the story of the twilight of the gods. When presented as The Ring, the four operas are presented within a single week and the total running time of the work is about 17 hours. It’s a massive work consisting of 2,092 pages of orchestra music, and this production requires the participation of 415 people and 12 animals. Mounting a production of the Ring Cycle is one of the most challenging things an opera company can attempt. Generally, three full cycles are performed. When a company with the stature of San Francisco Opera performs The Ring, it draws an audience from around the world. This was my third Ring Cycle. The Ring is too vast to address fully in a blog post, so instead I’ve decided to just string together some notes, some moments that stood out to me this time through. This was an American Ring, the tale begins with the California gold rush and ends in the near future.

The characters and narrative of The Ring are loosely derived from Norse mythology. But as new productions are mounted through the years, The Ring attracts the major threads of modern thought. The unconscious, capital, class, gender, power, sexuality, and race have all surfaced in one production or another. In director Francesca Zambello’s American Ring, ecology and the interconnectedness of things provides the environment in which the story unfolds. Here the canvas of the story isn’t a neutral backdrop, it’s affected by the actions and decisions of the characters. I’ve been reading and listening to a lot of Timothy Morton, so the idea that The Ring should address the ecological thought seems completely natural.

Alberich steals the gold from the Rhinemaidens and forsaking love, he fashions it into a ring of power. Wielding that power, he begins a massive gold mining operation, delving deep into the earth, he turns the magic power of the ring into the material power of gold. The stage pictures bring to mind Sebastiao Salgado’s photographs of gold mining in Brazil. Meanwhile in the world of the gods, Wotan has flipped the structure of the gold mine upwards toward the heavens and created a Valhalla of skyscrapers. But like so many in the recent mortgage crises, he’s purchased a Valhalla that he can’t afford. In order to avoid default on the fortress of the gods, Wotan resorts to crime. He must steal the gold from the thief Alberich—a little money laundering to cover up the stains on the foundation of the godhead.

In Zambello’s Ring, the concentration and exercise of power drains the earth of its life. Power is drawn from the environment, but the earth isn’t an infinite resource. As the operas unfold, the environment has been turned into a standing reserve– a battery, or a gas tank, to power the regime. At the beginning of the third act of Gotterdamerung, the Rhinemaidens are destitute, collecting trash in big garbage bags as their river has been choked with the flotsam and jetsam of the industrial wasteland surrounding them. The struggle for the Ring taking place in the foreground is interrupted by the background of the story. The river would like its gold back.

At the end of the Ring Cycle, Brunhilde has understood that the Ring must be returned to the river and that this will mean the end of the gods. The music registers the cataclysm of the fall of Valhalla and the cleansing power of the river to wash the sins from our hands. The end of the Cycle points to an ending as beginning. One door closes and another opens. Zambello is an optimist, the return of the Ring represents the possibility of renewal. Throughout the story we’ve seen the earth’s finitude, the director’s gesture in the very last stage picture indicates the damage is not beyond repair.

The Ring Cycle is so large that there’s no vantage point from which to take it all in. Well before the first notes, the experience begins to engulf you. There’s a review of the motifs with Deryck Cooke. Listening to favorite recordings, trying to get the sequence of events in the story lined up. Thinking about the singers cast in various roles and whether they’ll be up to the daunting task ahead.

Believe me, nobody has every composed in this manner. I think my music must be frightening. It is a morass of horrors and sublimities.

—Wagner to Liszt, January 1854

Once the performance begins you’re well into the middle of it. The opera is broadcasting on all frequencies and flooding the senses. In this experience of the Ring Cycle, I had the distinct impression that the music continued between performances of the individual operas. While there aren’t hummable tunes in the Ring, the motifs of the music seemed to detach themselves from the opera and emerge from the America that exists outside of the opera.

Even after the final end, the music continues to play, the cycle begins again. Once inside, there may be no outside.

Several years ago, the San Francisco Opera commissioned a work by John Adams called ‘Doctor Atomic.’ It’s the story of the creation of the atom bomb. The director of the premiere was Peter Sellars. In a talk he gave about the opera, he noted that the stage of the War Memorial Opera House directly faces City Hall, the seat of power for local government. The relationship between the buildings provided an avenue for art to speak to government.

Perhaps we no longer think that art has anything useful to say to government. But the two buildings sit across from each other, waiting for the moment when the conversation begins to flow in both directions. Like ‘Doctor Atomic,’ the Ring Cycle had something to say to government.

The curtain came down after the final act of Gotterdamerung and applause erupted. Then the curtain rose for Nina Stemme, the Brunehilde of this Cycle. A solo bow, in acknowledgement of her achievement. The crowd leapt to its feet applauding, shouting, whistling, in a unanimous ovation. It was a thrilling moment.

And an unusual moment between the second and third acts as Donald Runnicles, the conductor, took his place. A spontaneous standing ovation for the orchestra. As a friend said during that intermission, “man, they’re just wailing.”?

Leafing through The Ring’s program, I noticed the names of the individual and corporate sponsors. Opera is an expensive business, and David Gockley, the general director of SF Opera, has made it clear that the company is in financial straights. The big donors to the opera are small in number and advanced in age. He openly wonders where the next generation of patrons will come from.

This brought to mind Cynthia Salzman’s book ‘Old Masters, New World: America’s Raid on Europe’s Great Pictures.’ The new world started from cultural scratch.

“In the late nineteenth century, as industrialization transformed the United States into a world power, artists and writers decried the nation’s meager collections of art. “I cannot tell you what I suffer for want of seeing a good picture,” Mary Cassatt complained from the confines of Hollidaysburg, Pennsylvania, in June 1871. The twenty-seven year old artist had spent five years painting in Europe and longed to return. The novelist Henry James view the problem more broadly. Americans, he told his mother in 1869, seem to have “the elements of the modern man with with culture quite left out.” Ten years later, in writing about Hawthorne and famously listing the cultural assets missing from the United States in the early part of the century, James, who had himself decamped for England in the mid-1870s, conveyed his own sense of deprivation: “no cathedrals, nor abbeys, nor little Norman churches, no great Universities nor public schools—no Oxford, nor Eton, nor Harrow; no literature, no novels, no museums, no pictures.” Later, in 1906, when the British critic Roger Fry served as curator at the Metropolitan Museum of Art, he tallied the museum’s pictorial shortfall: “no Byzantine paintings, no Giotto, no Giottoesque, no Mantegna, no Botticelli, no Leonardo, no Rafael, no Michelangelo.”

The giants of industry, Henry Clay Frick, J. Pierpont Morgan, H.O. Havermeyer and Henry Gurdon Marquand, took an interest in redressing the imbalance of culture in the new world. The great fortunes amassed during this period were put into service for one of “history’s great migrations of art.”? It was an event that fundamentally changed the character of this country.

In this day and age, it’s something we take for granted. The museums are filled with pictures, the symphony hall with music, and the opera house with divas. Perhaps we think this high art is the province of the upper classes, the restricted playground for old money. It’s a living legacy and if the next generation doesn’t take it up, it could very easily disappear. The performing arts are in particular danger.

Donald Fisher, founder of The Gap, collected more than 1,000 contemporary paintings and eventually donated them to the San Francisco Museum of Modern Art. But could it be that his is the last generation to have a real connection to the arts? The new generation of technology billionaires seems more interested in popular culture, sports and science. As I leafed through the program of the Ring Cycle, I didn’t see the names Google, Apple, Intel, Oracle, Cisco, Facebook or Microsoft. Rich technologist seem to prefer to put their money back into technology through venture capital investing.

I’m not sure what it would take to connect the Silicon Valley’s Techno-Elite to Opera. But if it were to happen the possibilities would be immense. San Francisco has a long history with opera. The gold rush of 1849 brought masses of people to Northern California. San Francisco’s first opera production was in 1851, Bellini’s ‘La Sonnambula.’ Morosco’s Grand Opera House held an audience of 4,000, including standees. A signal event in the rebirth of the City after the 1906 earthquake was the concert by the soprano Luisa Tettrazini in front of Lotta’s Fountain. It’s said that as many as 250,000 people attended. More recently the annual Opera in the Park and Opera in the Ballpark events draw enthusiastic crowds from all walks of life.

In the era of the 140-character communique it may seem counter-intuitive to yearn for the total theater of the opera, but opera performance actually delivers on what 3D HD movies promise. And strangely, at this moment in history with music, singers, musicians, technology and composers we could be at the cusp a of great new era of opera. Here are two examples of new operas that take up the current of our times. This Fall, San Francisco Opera will debut ‘Heart of a Soldier’ by Christopher Theofanidis, with libretto by Donna Di Novelli. It tells the story of Rick Rescorla, a man trained to be a consummate solider who gave up his life saving thousands during the World Trade Center attacks of September 11, 2001.

And perhaps closer to the pulse of technology flowing through the Bay Area, the English National Opera recently debuted Nico Muhly’s ’Two Boys’ with libretto by Craig Lucas. Here’s a description from a Wall Street Journal review:

A prepubescent boy is stabbed, and a teenaged boy is caught leaving the scene on CCTV. But the middle-aged female detective in charge of the investigation, caught up in the intricacies of chat-rooms, user-names, apparent espionage and cybersex, comes to realize that she has to change her own mind-set if she is to understand the behavior of these children and the morality of the internet age.

We say that this technology we’re creating here in the Bay Area is changing everything. I wonder if we’ll every take it seriously enough to engage technology in a deep conversation with art and culture? The War Memorial Opera House in San Francisco could be the site of one of the great historical conversations about the times we live in. If only the right connections could be made…

Two sides of an equation, or perhaps mirror images. Narcissus bent over the glimmering pool of water trying to catch a glimpse. CRM and VRM attempt hyperrealist representations of humanity. There’s a reduced set of data about a person that describes their propensity to transact in a certain way. The vendor keeps this record in their own private, secure space; constantly sifting through the corpus of data looking for patterns that might change the probabilities. The vendor expends a measured amount of energy nudging the humans represented by each data record toward a configuration of traits that tumble over into a transaction.

Reading Zadie Smith‘s ruminations on the film “The Social Network” in the New York Review, I was particularly interested in the section where she begins to weave the thoughts of Jaron Lanier into the picture:

Lanier is interested in the ways in which people ‘reduce themselves’ in order to make a computer’s description of them appear more accurate. ‘Information systems,’ he writes, ‘need to have information in order to run, but information underrepresents reality (Zadie’s italics).’ In Lanier’s view, there is no perfect computer analogue for what we call a ‘person.’ In life, we all profess to know this, but when we get online it becomes easy to forget.

Doc Searls’s Vendor Relationship Management project is to some extent a reaction to the phenomena and dominance of Customer Relationship Management. We look at the picture of ourselves coming out of the CRM process and find it unrecognizable. That’s not me, I don’t look like that. The vendor has a secured, private data picture of you with probabilities assigned to the possibility that you’ll become or remain a customer. The vendor’s data picture also outputs a list of nudges that can be deployed against you to move you over into the normalized happy customer data picture.

VRM attempts to reclaim the data picture and house it in the customer’s own private, secure data space. When the desire for a transaction emerges in the customer, she can choose to share some minimal amount of personal data with the vendors who might bid on her services. The result is a rational and efficient collaboration on a transaction.

The rational argument says that the nudges used by vendors, in the form of advertising, are off target. They’re out of context, they miss the mark. They think they know something about me, but constantly make inappropriate offers. This new rational approach does away with the inefficiency of advertising and limits the communication surrounding the transaction to willing partners and consenting adults.

But negotiating the terms of the transaction has always been a rational process. The exchange of capital for goods has been finely honed through the years in the marketplaces of the world. Advertising has both a rational and an irrational component. An exceptional advertisement produces the desire to own a product because of the image, dream or story it draws you into. Irrational desires may outnumber rational desires as a motive for commercial transactions. In the VRM model, you’ve already sold yourself based on some rational criteria you’ve set forth. The vendor, through its advertising, wants in to the conversation taking place before the decision is made, perhaps even before you know whether a desire is present.

This irrational element that draws desire from the shadows of the unconscious is difficult to encode in a customer database profile. We attempt to capture this with demographics, psychographics and behavior tracking. Correlating other personal/public data streams, geographic data in particular,  with private vendor data pictures is the new method generating a groundswell of excitement. As Jeff Jonas puts it, the more pieces of the picture you have the less compute time it’ll take to create a legible image. Social CRM is another way of talking about this, Facebook becomes an extension of the vendor’s CRM record.

So, when we want to reclaim the data picture of ourselves from the CRM machines and move them from the vendor’s part of the cloud to our personal cloud data store, what is it that we have? Do the little shards of data (both present and represented through indirection) that we’ve collected, and release to the chosen few, really represent us any better? Don’t we simply become the CRM vendor who doesn’t understand how to properly represent ourselves. Are we mirror images, VRM and CRM, building representations out of the same materials? And what would it mean if we were actually able to ‘hit the mark?’

Once again here’s Zadie Smith, with an assist from Jaron Lanier:

For most users over 35, Facebook represents only their email accounts turned outward to face the world. A simple tool, not an avatar. We are not embedded in this software in the same way. 1.0 people still instinctively believe, as Lanier has it, that ‘what makes something fully real is that it is impossible to represent it to completion.’ But what if 2.0 people feel their socially networked selves genuinely represent them to completion?

I sense in VRM a desire to get right what is missing from CRM. There’s an idea that by combining the two systems in collaboration, the picture will be completed. We boldly use the Pareto Principle to bridge the gap to completion, 80% becomes 100%; and close to zero becomes zero. We spin up a world without shadows, complete and self contained.

From T.S. Eliot’s The Hollow Men

Between the idea
And the reality
Between the motion
and the act
Falls the Shadow

For Thine is the Kingdom

Between the conception
And the creation
Between the emotion
And the response
Falls the Shadow

Life is very long

Between the desire
And the spasm
Between the potency
And the existence
Between the essence
And the descent
Falls the Shadow

For Thine is the Kingdom

For Thine is
Life is
For Thine is the

This is the way the world ends
This is the way the world ends
This is the way the world ends
Not with a bang but a whimper.

It’s a rare thing that I read a Doc Searls post and start shaking my head half way through. The recent $100 million investment in Twitter, bringing their valuation to $1 billion, has unleashed  a torrent of criticism. Driving my daughter to school the other day, I heard an “analyst” on NPR chirp that Twitter couldn’t be worth $1 billion because it was just a fad, that people might stop using it tomorrow and the bottom would fall out. If using Twitter were a random activity that returned no value, I suppose that could be true. Just as people could decide to stop going to the movies, stop eating pizza or stop listening to “analysts” on NPR. If the value of something is disregarded at the start, it’s rather difficult to speak sincerely of valuation.

Searls’s criticism is a reprise of the open source silo meme. The drumbeat for the nationalization of Twitter has re-emerged. The capitalist pigs at Twitter have chosen to build a business rather than contribute their technology to the open source technology commons. Praise is sung for linux, rss, email and http. If only Twitter would see the light and release what they have to benefit the common good. Twitter’s business is just lumber from which other software developers should be allowed to create value. The complaint is that because Twitter is neither open nor decentralized, it has created an intractable engineering problem and does not contribute to the greater good of the web.

I would contend that Twitter is both open and distributed. Its characterization as a silo misses the point. Rather than using the silo as a criteria for openness, what if we look instead to the pipe. In the Unix command line, the standard output can be piped to the standard input of a new filter. Some very complex forms of processing can be created by chaining together a series of filters and piping data through it. The “chainability” of the javascript library Jquery is another good example of this model. The critique of the silo is its lack of interoperability, you can’t pipe to or from it.

Now, let’s look at Twitter. Can you pipe messages to Twitter? Can you pipe messages from Twitter? There was a time when I used Identi.ca as a primary micromessaging client. I typed messages into the Identi.ca web client and they entered the local pool, then I piped them to FriendFeed, where they also entered that ecosystem, FriendFeed sent them to Twitter, and Twitter sent them to Facebook. Examining this relay chain could you say that Twitter is a silo that owns my messages? Each of these venues represents a slightly different social graph and has a different tool set with which to display, prioritize and filter my messages within the context of the local graph. Twitter and Facebook are simply the most successful venues with which to read and write micro-messages (formerly called status messages). Google reader shares, SMS messages, Blog entries, et cetera can all be piped in and out of Twitter. Or if one prefers, Twitter can be left out of the chain entirely.

The mind share that Twitter and Facebook have built can’t be nationalized and distributed as lumber for a hypothetical socialist realist distributed micro-messaging ecosystem. If one is truly interested in open, look to the pipe, not the silo. Certainly there’s work that needs to be done on the pipe itself. Issues around real time, rate limiting, identity, social graphs, micro-communities, activity stream formats and track are all very important. But the real time stream environment is already here and operational. Many in the open source crowd are just rewinding the VCR and replaying the last battle. Steve Ballmer summed it up nicely in his interview with Mike Arrington, “we want to be first, best and interoperable.” Even Microsoft has embraced the pipe.

Before the turn of the millenium, back when I was first joining an investment bank, I wanted to do some background reading. One of the must-reads was Michael Lewis’s Liar’s Poker. Of course, we were looking at disrupting the business. But in the over-heated world of the Internet IPO, no one wanted to disrupt anything– there was too much money at stake. Like all bubbles, that one eventually popped.

Our firm had a small part in popping that bubble with a piece of research we produced called “burn rate.” The first crop of Internet companies went public very early in their lifecycles. That meant they had to report their financials quarterly. At a certain point it was a simple matter of looking at cash versus run rate to determine how many months these firms had left. In Internet Bubble 2.0, initial public offerings were not possible, but the principle of burn rate remains the same. If a firm is not at, or close to being cash flow positive, they’re burning cash. This time the fires are behind closed doors, but their burning just as brightly.

But the Internet Bubble is nothing compared to the Real Estate / Sub-Prime Bubble. While trying to get my hands around this Bubble and Collapse, I turned to Michael Lewis again. Lewis’s article, “The End,” in the December issue of Portfolio nails it. The Sub-Prime meltdown is difficult to understand. And when people talk about the “bailout,” it’s hard to understand what exactly needs to be bailed out. Treasury Secretary, Hank Paulson, has come under criticism because he’s perceived to be playing whack-a-mole with the crisis.

Lewis takes a simple approach to explain the situation. He looks at the other side of the trade. Every trade requires a buyer and a seller. While the vast majority of the nation and Wall Street were buying in to the idea of ever rising real estate values, Steve Eisman, of FrontPoint Partners, was shorting the bubble. The article exposes the transubstantiation of BBB rated debt into AAA rated debt. As Eisman struggles to understand the trades he’s making, we start to understand the Doomsday Machine that Wall Street was constructing. For the bubble to keep expanding, it was important that the emperor was percieved as being fully clothed and regal. People like Peter Schiff were laughed at for trying to seriously address the problem. Risk is at the heart of investing, but in the real estate bubble, risk was grossly misrepresented. The label on the box said it contained wholesome ingredients, higher return with less risk. It was too good to be true, and it was. Bubblicious.

Lewis closes the loop by having lunch with John Gutfreund. Gutfreund was the CEO of Salomon Brothers while Lewis worked there. Liar’s Poker chronicles that time. They were the first i-Bank to go public, created the mortgage-backed security and their BSD’s from the bond arbitrage group went on to found Long Term Capital Management. Investment Banks follow the Golden Rule, he with the most gold makes the rules. Lewis posits that this is the end of investment banking as we know it.

There are some distinctions that need to be made when thinking about the creation of new modes of interaction on the Network. A number of metaphors are currently employed when talking about services like Twitter (Identi.ca imitation is the sincerest form of flattery). The judgement we seem to be trying to make is whether this new thing will go viral, or will gain broad market acceptance. When we answer questions about the new thing in this way, we’re pretending to be venture capitalists. What we’re asking is: will my investment pay off? And since we have no real skin in the game, we’re really asking, will Fred Wilson’s investment pay off for his investors? There’s an assumption at the base of the question about what’s really important. In a sense, it’s a moral position about what’s most valuable and a definition of the fundamental drivers of innovation. Thus the endless questions about “business model.”

After the money question, we’ll ask what most people will do. Will this new thing be adopted and become common practice? There are a number of binary oppositions we use as sledgehammers to beat the daylights out of any emerging form of life. These tools are a substitute for thought and discovery, they stand between us and what is unfolding before our eyes.

• Digital Natives vs. Digital Immigrants
• Young People vs. Old People
• Early Adopters vs. Most People
• The Enterprise vs. The Consumer
• Geeks vs. Jocks
• You vs. Your Grandmother

Tools for thought need to be put into question even as we employ them. When we thoughtlessly pick them up and use them as a hammer, we’re just repeating memes. The meme is speaking us and just asserting its evolutionary destiny as a selfish gene. When a meme is repeated to a group in conversation and all heads nod knowingly, no thought has taken place. Rather, this is an example as language as a virus.

So when does thinking begin as we continue our conversation on these new modes of the Network? It starts with a question and the deepening of the question. The Answer puts an end to the dialogue. Think of an answer like a software release; there’s alpha, beta, release candidates, golden masters — but in the end everything launches with bugs and has a version number assigned to it. The only way to move the ball down the field is to return to the question.

We’re starting to see the emergence of the Live Web from the established Static Web. The mistakes we make at this point give us important information about the future landscape. Twitter built a static web application using a content management system metaphor. But by opening pipes to the live web through SMS, XMPP and Track, Twitter enabled a compelling live web experience. Twitter’s ensuing stability problems have taught us that static web architecture can’t support live web usage at scale. The team there now has to start over with a live messaging architecture that can support the experience that was discovered. In this effort, Twitter’s simplicity is its friend. Oddly, the imitators don’t seem to have comprehended this lesson.

The interesting conversation around Twitter isn’t about whether it will make someone money or whether your grandmother will use it. Rather it’s the question about whether it’s a real foundational piece in bootstrapping the coming Live Web. Twitter’s Follow and Track relationship models have uncovered a much larger social space for real time interaction. Where the real-time web as IM is largely point-to-point, allowing two previously connected individuals to trade messages, Twitter enables a space where meeting someone new is a possibility. Our bootstrapping activity is only partially about technology, fundamentally it has to be about how we use the service right now and our ongoing conversation about its possibilities.

 

Shuffling through my notes, I found a post that slipped through the cracks. It references a Gillmor Gang from earlier in the month, Mark Lucovsky of Google was a guest on the show:

• GillmorGang 20080606

The conversation was wide ranging and focused on Lucovsky’s current role at Google and his former role at Microsoft. Jason Calacanis shifted the discussion on to the general ecosystem of online business infrastructure. He’s in the middle of making some decisions about the growth path for Mahalo and sees the cost of these services dropping rapidly.

Calacanis’s political point was that the virtualization of fundamental web infrastructure lowers the cost of business creativity and therefore will be a major economic driver– and may pull us out of this recession. Lucovsky commented that he didn’t see a consolidation of infrastructure providers, but rather an environment where each of the big online companies provided the thing that they do best as an API or service.

In a comment on Microsoft’s Live Mesh, Lucovsky asserted that the complexity of the problem required a seasoned professional like Ray Ozzie. He’s made the requisite number of mistakes to take on a project of that level of difficulty. Lucovsky goes onto say that there’s a difference between this kind of creativity and the frothy sort of Web 2.0 stuff that comes across our screens every day via TechCrunch.

Assuming that business creativity in this ecosystem is not the sole province of the young and the rich, there are a couple of pieces missing. This picks up the thread of a conversation that happened about a year ago about age and business creativity. It was a conversation that unleashed a lot of passion. Here are a couple of links back into that conversation space:

• Fred Wilson: The Age Question
• Dave Winer: I did it anyway
• Clay Shirky: The Future belongs to those who take the present for granted
• Clay Shirky: The bayesian advantage of youth

Creativity in any space is tied to risk taking. The young assume immortality and therefore have a high tolerance for risk, time allows for recovery from failure. The rich also can recover from failure through the buffer of money. As we all know, time is money and conversely money is time — and time heals all wounds.

If, as Calacanis asserts, it’s all about ideas in this new era of cloud-based infrastructure, then implicit in that is the notion that the services that sustain the human side of that equation take a similar form. National healthcare and a decent retirement system would reduce certain aspects of risk and open the field to a broader range of individuals: people who’ve lived a little and made the requisite number of mistakes to create at a deeper level.

A new era of a meritocracy of ideas in the technology businesses is deeply intertwined with the political questions that sustain the humans that do that work. In our conversations about the path of technology, these background processes need to brought to the surface– if there is to be change we can believe in.

This isn’t a review. I’m not sure that reviews are very useful beyond the basics: Here Comes Everybody is an important book. Some people will choose to read it, but that doesn’t really matter because it’s in the air we breath. You’ll absorb the book’s insights through some sense organ within the next few years. Clay Shirky has written about network theory in a style that might appeal to a broader audience; and it will directly reach more people than books by Duncan Watts or Albert-László Barabási. However reading will not be the primary diffusion model.

One criteria I have for judging the quality of a book is the number of times I have to stop reading. This generally occurs when some string of words in the flow of the book makes a strong connection either to concepts from another text, or to something I’ve scribbled in one of my notebooks. The monologue of the text is interrupted by a conversation racing across a network of intertextuality. While this slows reading as an act of consumption, it opens the door to reading as a full-duplex, 2-way engagement. And that’s where its real value is revealed; in this sense, I found Here Comes Everybody to be a very promiscuous book. There were connections everywhere.

The obvious literary reference would be to Joyce, but instead Rilke provided the more forceful connection with his fragment “We are the bees of the invisible:”

Transform? Yes, for it is our task to impress this provisional, transient earth upon ourselves so deeply, so agonizingly, and so passionately that its essence rises up again “invisibly” within us. We are the bees of the invisible. We ceaselessly gather the honey of the visible to store it in the great golden hive of the Invisible.

There’s a sense in which this describes the process by which poetry is crafted, but it also seems to inform the way we build the collective experience and history of a group. We have a collective story we tell each other about the importance of the individual, but stories about family, tribe and society are on the rise again. Shirky points out that the transaction cost of organizing a group has declined nearly to zero through the tools available on the Network. He goes on to note that low transaction costs are not sufficient — a plausible promise around purpose and a mutually beneficial membership bargain are equally necessary for a living community. 

Two factors suppressed in the current commercial infatuation with the social graph are the ownership of the products of the community and the emotional volatility of a group. These are high risk ingredients in the recipe, human elements that need to be purged to sell the current business models. And those services without explicit business models continually run up against these issues. Can you sell what isn’t solely yours to sell?

As we gather in tribes and loose associations across the Network, we invent ceremony, initiations, ritual, taboos and forms of justice to ensure the ongoing health of the system. We optimistically believe the rules, mores and sins of our fallen culture won’t simply be mapped on to the social space of the Network. Experience has shown that absent some form of persona or identity, the life of an online community will be nasty, brutal and short. Could the Network be the new world where individuals are judged by the character of their content? Or is it really just more of the same, a place where it’s not Metcalf’s law, but Sturgeon’s law that rules the day.

We’re in the middle of a shift in perspective. We’ve been focused on the individual, the physical limitations of an un-networked personal computer metaphorically defined the limits of our ability to think about the Network. In the area of identity we seem to only now be uncovering the idea of a relationship layer. The silo’d thinking of the technical community causes it to lay down cow paths on the well-paved roads of other disciplines. While Shirky’s book is written for the layman, its highest and best purpose may be in introducing technologists to the idea of society.

In the larger network of connections there are two that put themselves forward. In Saussureian Linguistics meaning is derived from the set of differences within a system. Here are a list of ideas that can help us overcome the solipsism of the hard drive:

• “A sign is the basic unit of language (a given language at a given time). Every language is a complete system of signs. Parole (the speech of an individual) is an external manifestation of language.”
• “A linguistic system is a series of differences of sound combined with a series of differences of ideas.”
• “The connection between the signifier and the signified is arbitrary.”
• “In language there are only differences, and no positive terms”
• “Speaking of linguistic law in general is like trying to pin down a ghost”

????????
The other charged connection is to Ludwig Wittgenstein’s thoughts on the idea of Private Language. Like those who believe in Private Languages, we seem to be caught in the fly bottle. We don’t understand that language and communication is social at its core:

If the idea of a private language is incoherent, then it would follow that all language is essentially public: that language is at its core a social phenomenon. This would have profound implications for other areas of philosophical study. For instance, if one cannot have a private language, it might not make any sense to talk of private sensations such as qualia; nor might it make sense to talk of a word as referring to a concept, where a concept is understood to be a private mental representation.

Nor might it make sense to talk about identity apart from society, computing devices apart from the Network, or data (signifiers) apart from an economic and trading system of language. The end of our solipsistic weltanschauung is beginning; we are perhaps in the middle of the beginning of a general revolution. Some will ride the strong currents as they emerge, others will fight the current, grow tired, and eventually drown. And the looming danger ahead is the task of assuring and preserving the inalienable rights of the individual in this new Network. Once the technical perspective has been transformed from the one to the many, all the really important questions become political.

Here are some of my rules for startups:

• Have a great product that everyone wants
• Enable huge margins by creating great value
• Reduce the production cost of your product to as close to zero as possible
• Sell lots of your product
• Make it easy for your customers to pay you
• If you don’t have a hit product, preserve your ability to make errors

Efficiency in a start up business has to do with your margin for error. The larger your margin for error, the better your chance of success. You want to use resources wisely so that you can make more errors. If you are a model of efficiency and save money on all the right things and don’t invest in making errors, it won’t matter.

When you find the right product or service, and the stars align, you’ll want to be able to put your foot on the gas. That takes money, it’s the moment when you test your belief in your product. It’s hiring at the right time, scaling infrastructure, buying advertising and providing adequate customer service. If your company has money, you maintain control. If you don’t, you’ll lose equity to investors in exchange for the funds to go from beta to launch.

And a final piece of advice, understand what the words ‘burn rate’ mean. Until your burn rate has crossed over the zero point, and your model is delivering on the margins in your plan, you’re on the clock. It works just like basketball, you miss every shot you don’t take. If you’re open and you have your shot, you’ve got to take it.

Is The Funded going to create transparency and symmetric access to information for both buyers and sellers in the private investing market? TechCrunch says that they’re going to create a database of term sheets. If this works, it’ll change the landscape of private investing.Today venture capital firms have vision into the pricing market, in fact they largely create it. New companies are completely in the dark. How do you decide the right price for equity units in a private company? How does a new company know if they’re getting a good deal, or getting taken? Openness and transparency will change the market and just like with IPO pricing, the status quo will resist the change.

Arrington writes that some of Digg’s unpaid editors are moving over to Mixx. Since they aren’t compensated for their work, switching costs amount to getting some of their friends to switch too. This is an interesting case study in the value of social networks. If the creators of the “user generated content” decide that the environment has become poisoned with negativity, they may decide to pull up stakes and migrate to another more friendly environment.

One Digg user makes the claim, in Arrington’s article, that:

I think Mixx has a real chance for success…Mixx has a much more positive audience than Digg. It always amazes me that even the most popular and highest quality articles can get so many negative and unnecessarily degrading comments on Digg. So far the users of Mixx have proven to be quite a bit more pleasant, something that I know will be welcomed by most users.�

Negativity can quickly become viral in a social network, especially where some kind of voting takes place. Competitive strategies can overtake collaborative strategies and then the community’s overall output starts to become skewed. To combat the negativity, the owners of the site make rules to curb some forms of competition, and before you know it– it’s not that fun anymore.

It’s interesting to watch the figures of game theory play out before your eyes. Should part of the valuation of a business that depends on social networking and voting be dependent on its ability to enforce and maintain a friendly environment? See Craig Newmark for a lesson in how this can be done.