174
446 joiners, the “I piss people off, cause I drive a BMW” group (don’t invite the latter two to the same party). At Meetup, there are six clubs where people gather with their Beemers. BMW has its own official car club offering 75,000 members rebates on cars and discounts on Brooks Brothers clothes (do they see the demographic humor in that?). These are the company’s best customers, its partners. BMW should solicit their help in designing cars, supporting fellow drivers (there’s a little of that in the club forums), and even selling cars. On Facebook, BMW invited customers to color pictures of its car. It’s hard to imagine something more children’s museum-like than a company enticing adults to color cars. But more than 9,000 people submitted their designs in only a few days. What that tells me is not just that they love their BMWs but that they would love BMWs that looked unique—BMWs that expressed their muses as well as their libidos. What an opportunity the industry has to bring humanity and personality back to cars. If so many of us like to express ourselves in blogs; YouTube videos; Facebook, Bebo, and MySpace pages; and Flickr photos—if, as Google understands, many of us want to have a strong identity online through self-expression— why wouldn’t we want to express ourselves through our cars? Companies have turned their products into commodities by imposing such sameness on them. I know, it’s about efficiency—four lines of cars built under four brands on the same body with the same engine and parts makes them cost-effective. Factory efficiency and dealer economics also stop us from ordering custom-made cars anymore. We buy off the lot, not out of the factory, and we buy cars that are often loaded—like cable subscriptions— with things we don’t want. (Every time I start my car, I turn off the night-vision rearview mirror, a $100-plus option I didn’t want but had to buy.) Sure, there’s an aftermarket for options—piney scent strips, hubcaps that spin, mud ?aps with mirrors in the shape of naked women—but, well, that’s just not me. Toyota’s Scion took a small step toward personalization when it enabled drivers to design crests for their cars. Now go the next step and imagine I could take an unpainted car to any of those BMW designers on Facebook or my student the graffiti artist and have my car painted so that it looks like no other. It’ll cost me. But I’ll bond with that car and love it because it’s an expression of me. That unpainted car would be the beginning of an auto company thinking
Jeff Jarvis
175
open-source. What if the company also produced a car onto which I could graft someone else’s dashboard or seats or grill or engine? Earlier, I talked about Google replacing its ?eet of company cars with Toyota Prius hybrids that were modi?ed so their extra batteries could be recharged with solar power. That is the Googlemobile. Google treated the Prius as a platform. Toyota should be delighted. It should build in opportunities to modify its car in countless ways. I can hear the objections: It could complicate production, raise costs, and confuse brands. Maybe. But it could give me the car I want. The car company of the future should be a platform for more car companies that make the automobiles drivers want, not the ones they settle for. There are projects aimed at building the open-source car, among them Oscar from Germany, the c,mm,n (or common) hydrogen car from universities in the Netherlands, and the Society for Sustainable Mobility car (being built with 150 part-time engineers, according to Fast Company). The Aptera from Bill Gross’ IdeaLab (more from him later, in the chapter, “Google Capital”) is a beautiful, three-wheeled hybrid or electric vehicle set to launch in California. Tesla Motors is building a six-?gure-plus all-electric sports car with funding from one of PayPal’s founders. They are all cool and I wish them luck. But it’s damned difficult to get a car company operating at scale—ask John DeLorean. That is why I think a car company that already operates at scale should think open-source and welcome these nascent efforts to build atop them. Imagine seeing a million Priuses, Saturns, Fords, or Apteras on the road and wondering what’s inside each, what makes it run, who painted it, where you can get that great grill. Imagine being given the power to customize your car from the ground up. Cars would be exciting again. Give me control of my car and I will own that brand, make that brand, love that brand, and sell that brand because it is mine, not yours. That will be the key to marketing Googlemobiles: passion, individuality, creation, choice, excitement, newness. Drivers will start Facebook groups, blogs, and Meetup clubs extolling the wonders of the cars they choose—no, make. Outside product designers and manufacturers will accessorize and improve the open-source car—as outside developers make Facebook apps and mash up Google Maps—which will support new businesses and help sell more cars. There is the advantage of being a platform. Now we come to the big problem facing car companies: dealers. We
176
don’t like car salesmen (in a 2007 Gallup survey, Americans rated them at the bottom—tied with lobbyists—with only 5 percent saying dealers had high honesty and ethics). They add little or no value to the transaction and none to the product. They make buying a car uncomfortable. Car companies in the U.S. are stuck with franchise laws that won’t allow them to sell directly. So what should they do? I suggest they start by creating a platform for customers to say just what they think of car salesmen so companies can rub dealers’ noses in it. Perhaps the voice of the people will reach and convince Congress to deregulate and open up car sales. We now do most of our car shopping online. We comparison shop, read reviews, review specs, and talk with friends. All we need the dealer for is a test drive. Once I know I want a car, why should I have to drive to the dealer; why doesn’t the dealer or a manufacturer’s representative deliver the car to me? Why can’t I buy a car at the auto show? Why should I have to negotiate with three dealers for the exact same product when open pricing online has already told me what the market will bear? The dealer structure builds in inefficiencies and costs that the industry—and we—cannot afford. The repair system is little better. My warranty is really an insurance policy that I should be able to redeem at any repair shop. The car company could still provide training—I would prefer to go to someone certi?ed—and would sell parts. If the repair market were more competitive, the car company and I would each bene?t. I discussed my rationale for the open-source car platform with Fred Wilson, a venture capitalist you’ll hear from shortly, and asked him what a Googley car company would look like. He said it already exists. It’s Zipcar, which provides 5,000 cars to 200,000 drivers in various cities and campuses. Drivers join Zipcar for $50 a month, then make reservations online and pick up a car in any of a number of garages, paying $9 an hour or $65 a day in New York, including insurance, gas, and 180 miles. I can get similar rates from traditional rental companies but with less ?exibility and convenience. Zipcar says each of its cars replaces 15 privately owned cars and that 40 percent of its members decide to give up owning a car. Similarly, Paris’ mayor announced in 2008 that the city would follow its successful bike-sharing program by making 4,000 electric cars available to residents to pick up and drop off at 700 locations. The goal is to get Parisians to buy fewer cars. I know what you’re thinking (and can hear the peals of laughter all the
Jeff Jarvis
177
way from Detroit): The last thing a car company should want is fewer cars. Are you nuts, Jarvis? Are you a communist or some tree-hugging fanatic? No. I’m just turning the industry upside-down. When I put the question to adman Rishad Tobaccowala, whose agency works in the auto industry, he said Detroit is not really in the business of making cars. He channeled the Googley car company and said: “I’m in the business of moving people from place A to place B. How can I do it in different ways? And as they are moving from place A to place B, how do I make them feel secure and connected?” He said that except for sleep, we spend more time moving around than at home. “Screw Starbucks as the ‘third place.’ The third place today is the automobile.” What is the automobile really about? “Navigation and entertainment,” he said—not necessarily manufacturing. Indeed, Tobaccowala said the most interesting parts of the General Motors business had been OnStar and—credit crunch aside—? nancing. Manufacturing is expensive, vulnerable to commodity pricing, laborintensive, weighed down by gigantic bene?t costs, and competitive. There’s the tyranny of atoms. What if a car company became the leader in getting people around and used others’ hardware: planes, trains, and automobiles? You tell the system where you need to go—or with access to your Google Calendar, it just knows—and it gives you choices at various price points: Today, you can take the train for less. Tomorrow, you drive because you’re running errands. The day after, you carpool to save money. This weekend, you get a nice Mercedes for the anniversary dinner. Next week, you take a chauffeur-driven car to impress clients. Along the way, you can pay for options: your entertainment synced in the car, wireless connectivity on the train, alerts to your iPhone, navigation concierges who direct you around jams. This is the new personal transportation and connections company built on the old car company as a platform. Hop aboard the Googlemobile.
Google Cola: We’re more than consumers
If big cars are hard to Googlify, packaged consumer products are harder. They are the building blocks of the mass market, predicated on manufacturing efficiency and marketing to a critical mass. Since the beginning of the internet as an advertising medium, it has been a truism that no one
178
will click on a banner ad for—let alone join a club or write a blog post about—toilet paper. TP is everyone’s example of a product that could not possibly bene?t from the web. There’s nothing Googley about toilet paper. Right? Besides perhaps getting TP printed with Wikipedia’s knowledge (there are TP publishers) or made from renewable, recycled resources, I must concede: I can’t conceive of Google Ultra Soft Toilet Tissue. Are all consumer products doomed to life without Googli?cation? Let’s imagine Google Cola. The strength and weakness of cola, like other consumer products, is that it is intended to be one-size-?ts-all. Yes, a number of cola brands and variations ?ght for scarce supermarket shelf space. But there are never enough varieties. I can’t ?nd my perfect cola. Mine would be caffeine-free but made with sugar instead of arti?cial sweeteners (can’t stand the aftertaste) and it would come in a small can so it wouldn’t go ?at, or better yet, a bottle that could be reused. It might have a ?avor added (cherry today, coffee tomorrow). I’ll take Coke or Pepsi (I’m bicola), but I don’t like off-brands (I still shudder remembering Howard Johnson’s HoJo Cola). What if Coke retooled a bottler to make special-order batches to be delivered—but only if I committed to buying so many cases a year? I would pay a premium to subscribe to my perfect cola. If I sold this Jeff Cola to others on my blog or in the neighborhood (convincing them that decaf coffee-?avored soda is not an oxymoron) perhaps my price could drop because I’d be bringing in more sales and volume. I’d create a cola club. It’s no different from Gary Vaynerchuk’s Vayniaks making and promoting their own wine. We’d become product managers and salespeople as well as consumers and customers. We could invent our own ?avors of Coke, sold under our brand, using Coke as a platform for manufacturing and distribution. We’d be in the cola business. Will my cola go mass? Not a chance. But a bunch of smalls could add up to a big, and Coke ends up in a new and loyal relationship with a lot of customers. It learns more about the public’s taste and may develop new products to sell on a larger scale. It saves on marketing as collaborators sell products. It gets a piece of businesses that might otherwise take bits of market share. It ?nds a way to battle the tide of commodi?cation in consumer products and joins in the small-is-the-new-big economy. The cola strategy could be applied to most any consumable product that would bene?t from specialization and personalization: cookies,
Jeff Jarvis
179
candy, ecological home-cleaning products with personalized scents. It could be executed not just by big companies but also and more likely by small ones using sales platforms such as Amazon and eBay. About the only mass product I know that customizes today is M&Ms, which you can order printed with a photo ($39 for 21 ounces) or a custom color ($48 for 56 ounces). That’s a nice gimmick, but it doesn’t change the essence of the product. What if I could get coffee-?avored M&Ms or my decaf coffee-and-M&M-?avored soft drink in bottles for me and the hundred people I found like me? That would be Google Cola. How about gadgets, then? Personal electronics might seem immune from Googli?cation because they are so complex in engineering and manufacturing. Yet technology is also what makes gadgets easier to change than cars, as a device can be updated via software instead of hardware. That’s what Google is doing by offering its mobile operating system to any phone maker. I could see Google proposing open standards for no end of connected devices. We can already buy refrigerators with internet screens. Their fabled promise is that someday they will take inventory of what’s inside, telling us what we can make with what we have and automatically ordering what we need. That’s the kind of information Google would love to organize. Home-delivery services Fresh Direct and Peapod in the U.S. and Tesco in the U.K. could order and deliver what we need and give us coupons for related products. Em could suggest recipes based on what’s in the fridge. Refrigerators become platforms for these companies to serve us. We have connected home-security systems with sensors and cameras. We have connected home-entertainment systems that can pipe web radio stations, iTunes music and movies, and YouTube videos to any device in the home. We will have connected cars with links to traffic information and feeds of entertainment. We have cameras connected to GPS satellites and to our computers. We have mobile phones that are becoming computers. Any device that produces information, that can be personalized or adjusted, or that communicates with or entertains us will be connected to the internet and to Google. Google will listen to and speak through these gadgets—if we give it permission—and deliver related information. Google would love to use that information to give us highly targeted and relevant advertising. That might freak privacy warriors. But if we can con-
180
trol that ?ow and bene?t from it (with relevant content and ads, bargains, and subsidies for the services we use), I’d hook up my fridge and phone. Google could become the operating system not just for the web and the world but for our homes and lives. Another challenge: fashion. We know what Googley fashion is: T-shirts, shorts, and sandals. It’s hard to imagine spartan, garish, geeky Google having an impact on taste and trendsetting, which are decreed by designers, fashion editors, and Hollywood. Fashion is top-down—or it was. Just as the internet democratizes news and entertainment, it is opening up style. A darling of the open fashion movement is Threadless, a T-shirt company that invites users to submit designs, which are voted on, Digglike, by the community. Winning designers receive $2,000 plus a $500 credit and $500 every time a design is reprinted. They become the Versaces of the crowdsourced runway. Just as in entertainment, we are learning that the public wants to create and leave its mark. A smart response is to create a platform to make that possible. CafePm and Zazzle provide the means for anyone to make and sell designs on T-shirts, mugs, bumper stickers, even underwear, getting a cut of every on-demand order. Threadbanger, a weekly internet video show, teaches viewers how to make cool do-it-yourself fashion with young designers. See also BurdaSm’s open-source sewing from the German publishing empire Burda, which decided to take copyrights off its dress patterns and invite the public to use them, adapt them, create their own, and share them. The site is ?lled with patterns, how-to’s, and discussion. Springwise reported that SANS, a small New York label, stopped selling its hit $85 square shirt in 2008 and then released the pattern. For $6, you get the pattern, which you print out at home, and a SANS label to sew inside. Opening the design is a nice idea but I can’t sew. So craftsmen could build a business out of making SANS or Burda designs on order, as some are doing, selling them on Etsy, a site ?lled with unique, handmade items, which has been the store for more than 100,000 sellers since 2005. OK, consumable goods, gadgets, and fashion could be Googli?ed. But what about Google TP? Surely it is not possible to bring Googlethink to toilet paper. There won’t be communities around toilet paper. I shudder to imagine TP 2.0 after seeing a commercial for toilet paper whose USP (unique selling proposition) is that it doesn’t leave little paper bits on your butt. Boy,
Jeff Jarvis
181
that must have been a tough sales conference. I can’t think of a better reason for advertising not to exist. As with newspapers, perhaps it’s time for the TP industry to get out of the paper business and ask what business it is really in. Cleanliness, right? When I was in Davos, what amazed me almost as much as hanging out with heads of state and industry was seeing an automated, self-cleaning toilet seat in the conference center. After ?ushing, a motorized arm comes out and grabs the seat, cleaning it as it rotates. It’s mesmerizing. I took video of it to share on YouTube. (Google “Davos toilet” for my video. Or for a more entertaining if politically incorrect demonstration, search on YouTube for “Swedish toilet seat Gizmodo”). The company that makes that product is not in the paper business. It’s in the clean-seat business. Toto, a Japanese plumbing manufacturer, has decided that the business is neither paper nor clean seats but clean bums and happiness. Toto invented the Washlet automated, computerized toilet seat, a marvel of technology that heats the seat to a cozy 110 degrees and spritzes you with warm, clean water after you’ve done your business. Then it dries you with gentle, warm air even as it magically eliminates odors. (On YouTube, search for “Toto Washlet FlushTV” to see a demonstration by W. Hodding Carter IV, son of the former Carter administration official and author of Flushed: How the Plumber Saved Civilization.) Before you laugh, know that Toto has sold 17 million Washlets (they advertised on my Buzzmachine with smiley faces superimposed on naked, happy, clean butts). The Toto is hot on YouTube with videos that have tens, even hundreds of thousands of views. Hollywood actor Will Smith has bragged on TV that he has the deluxe, $5,000 model and doesn’t spend a dollar on TP. Here we have the perfect convergence of problem and solution, hardware and software, technology and life with bottom-up marketing. This is the post-TP Googley toilet. Even in atom-based enterprises, the connections the internet makes possible can bring business bene?ts. No end of consumer products would be helped from a more open conversation: tool makers listening to craftsmen, cooking-utensil companies opening up to cooks, athletic equipment companies watching out for what athletes and trainers want. One should ?nd opportunities to make more targeted products and to partner with customers to design, support, and sell products. Google and the internet change everything, even factories.
Ser vice
Google Air Google Real Estate
Google Air: A social marketplace of customers
In contemplating how to remake an airline with Googlethink, I had just about given up. What can one do with such a commodity service, particularly one that has deteriorated so badly? Air travel’s business model today is based on overselling seats, billing us for checking bags, charging for pillows and pretzels and just about everything they can think of but air, jamming planes to the point of torture, treating customers as prisoners who can be kept on runways for hours without the food and water an inmate is allowed, and withholding information—all the while raising prices. Google couldn’t ?x that. No one could. But then I applied Google rules about connections and the wisdom of crowds with Zuckerberg’s law of elegant organization and my own ?rst law and asked how travelers on planes, trains, and ships or in hotels and resorts could be given more control (of anything but the cockpit, of course). And I wondered, what if passengers on a plane were networked? What if a ?ight became a social experience with its own economy? Start here: Most of us are connected to the internet on the ground. Soon, we’ll be connected in the air as planes, like hotels, ?nally get wireless access (after earlier failed attempts). Wi-? is good for airlines because they will have something new to charge us for and because it will keep passengers busy and perhaps less likely to grumble and revolt at delays
Jeff Jarvis
183
(though we might just blog and Twitter every problem and indignity as it occurs). Once connected with the internet, passengers could connect with each other. It would be easy for the airlines—or passengers themselves—to set up chats and social networks around ?ights and destinations so we could hook up before and during a ?ight. We could organize to share cab rides once we land, saving each other money. We could ask fellow passengers for tips about restaurants, museums, and stores and ways to get around. If the wi-? were reasonably priced and if there were electric plugs at our seats, we could also spend hours happily playing games with each other. Back when the 747 was introduced, it was supposed to offer lounges where passengers could hang out together. That didn’t last long as every inch was soon crammed with revenue-producing seats. Lounges are supposedly set for a comeback in the new Boeing 787 Dreamliner and Airbus A380 superjumbo jets. So imagine if in our onboard, online social network, we could ?nd people we want to meet—colleagues going to the same conference, travelers with shared interests, future husbands and wives—and we could rendezvous in the lounge. The ?ight becomes a social experience. I know this vision sounds far-fetched given our current experience of air travel. But play along. Socialization could be a key to decommodifying the airline. What if passengers chose to ?y on one airline vs. another because they knew and liked the people better? BMW drivers mingle with each other on Facebook; Lufthansa passengers could do likewise and they’d have more in common—shared affection for travel and for a destination. Remember: Your company is the company you keep. Your customers are your brand. Airlines might want to encourage more interesting people to ?y with them because interesting passengers would attract interesting passengers. Airlines could offer discounts and bene?ts to people who are active and popular in the social network. Today, airlines offer only seats: commodities. What if, instead, they were to offer experiences and societies? I know, the last thing we want most of the time is to get stuck with a talkative twit in the next seat. Maybe that’s because, by the time we get on a plane, we’re in rotten moods. Suspend disbelief still. Imagine returning to the days when we met interesting people in chance encounters in the air. Maybe passengers could choose to sit next to each
184
other. Next to the right talker, I might tolerate a middle seat. It would probably have to be David Letterman or Oprah sitting next to me. But it could happen. These passenger networks raise the possibility of creating a new economy around the ?ight. Airlines could set up auction marketplaces for at least some seats, as JetBlue began doing experimentally on eBay in 2008: What’s it worth for you to ?y to Orlando next Monday? Rather than buying seats only from the airline, if late-booking passengers could also buy seats from fellow customers in an open marketplace, that could solve some of the airlines’ overbooking problems, reducing the need to pay bumped ?iers. Yes, speculators could arbitrage seats, but if they’re paid-for and nonrefundable, what problem is that for the airline? Resellers become market makers. This exchange sets a new market value for seats that in some cases will be higher than the airlines’ own fares. The airline could use the exchange as a prediction market to forecast and maximize load. It might see a surge in demand for a destination, perhaps for reasons it could not predict (a new conference or festival, good media coverage for a getaway, a travel bargain, or currency ?uctuations unleashing pent-up demand). With sufficient notice, the airline could add capacity, which would keep it ahead of arbitrageurs. The airline always controls supply and now it would know more about demand. Similarly, if a ?ight were light the airline could offer passengers alternatives at big discounts to enable it to cancel the ?ight and reroute equipment long before departure, creating savings at the bottom line. The airline would increase ef?ciency and pro?tability; the passengers would get a dividend; and the environment would get a break. An open and ?exible social marketplace could transform the airline economy. Why shouldn’t airlines also turn frequent-?ier miles into an open market? In these miles, airlines created a virtual currency with greater reach and value than the fake currencies of Second Life or Facebook. But miles are essentially illiquid. Airlines make it next to impossible to get frequent?ier seats unless you’re ?ying to Krakow on Christmas Day a decade hence. Their other offers—use miles to buy a TV—are bad deals; Google search tells me so. Miles have been devalued to the point that they offer ever-lessening incentives to choose one carrier over another; they no longer act as the decommodi?er the airlines intended. So open it up: Let us bid on frequent-?ier seats, upgrades, and silver status with miles. Let us barter
Jeff Jarvis
185
miles with each other (I’ll sell you this iPod for miles I need for my vacation). The currency would regain value. It also means more miles will be redeemed, but that sword hangs over airlines’ heads in any case. These exchanges bring subtleties. In some cases, I won’t want to reveal my identity (telling strangers I’m leaving town); in others, I will (because I’m doing business). As seats are traded, identities and credit cards must be in the system for security. And so on. Yet creating such a network could rebrand the pioneer as the social airline—the fun airline, the nice airline, the airline where I’m back in control. (I would use the social network to start a movement to save my knees from the asses who slam their seats back into them. In an open market, I might even pay them not to.) Now imagine if airlines used these networks to capture the knowledge of their smart-about-traveling crowds and convert that wisdom into value. On our return trips, airlines should ask us to rate and review the hotels and restaurants we frequented. They should ask natives to share insider advice on eating and shopping in their towns. Similarly, hotels should capture guests’ reviews of nearby restaurants (as Hyatt has begun doing with its Yatt’it travel community), and cruise lines should gather shopping tips for every port. Travel companies have currencies to pay for the information: They could reward us with frequent-?ier miles or discounts on our next trips. And because they know who we are, they could anonymously aggregate data to enhance the information, as I suggested for restaurants: “American Express Platinum customers recommend . . . .” Or: “Canadians traveling to Florida really like . . . .” Airlines could collect an incredible database of live knowledge from real travelers with fresh information. Over time, they’d outdo TripAdvisor and Fodor’s—or the airlines could supply them with branded content, which in turn promotes the airlines. The airlines themselves become publishers by listening to, gathering, and sharing the knowledge of customers. The key to remaking an airline in this mold is giving control, respect, and organization to the customers, helping them ?nd each other and organize into conversations and markets. The customers have value to give. Airlines can capture that value in new ways to improve prices and the bottom line (see the discussion of Ryanair in the chapter, “Free is a business model”). But passengers won’t give their value if they are not valued, if they are still treated as cattle and criminals. At a party at the World Economic Forum at Davos, when I met one of
186
the Google cofounders, I mentioned that I was exploring the idea of what an airline would be like if Google ran it. I said I thought it would be social. He grinned and told me about a technology entrepreneur who had founded just such a social airline, but it had to shut down when employees were caught in a scandal smuggling drugs. Pity.
Google Real Estate: Information is power
I’ve already aired my enmity for real-estate agents and their oligopolistic fee structure. So I start this chapter not by suggesting how they can remake themselves but instead by speculating how others can disrupt, undercut, and destroy their business. I should explain why I feel this way about agents. I have had some bad eggs. I also know there are nice agents. It’s not personal. It’s ?nancial. I do not believe that agents add 6 percent’s worth of value to a home sale. The only reason they could demand that commission is because they have controlled the multiple-listing service (MLS) that is key to having your house seen by buyers. Agents aren’t the only parties ripping us off in the process. Title insurance is particularly irksome, as is the necessity of having surveys done and redone, as are home-inspection rackets that have never found the ?aws I have found after moving in. Let’s not forget lawyers, who make the process unnecessarily complicated so they, too, may soak us. Then there are newspapers that charge too much for inefficient advertising. The real-estate business is ripe for disruption. Attempts so far have failed because they only try to break open the existing structure, to create discount brokerages that can get homes into that precious multiple-listing service. Even though the U.S. Justice Department in 2008 reached an antitrust settlement opening up the MLS to discount brokers, we are still trapped in their closed system of mutual back-scratching. We need to replace the system. If tomorrow we all listed our homes on craigslist or an equivalent, we would pull the rug out from under the MLS. Some realestate agents—the smart ones—list homes in these alternative databases today. Shoppers may also list their desires to buy or rent homes or ?nd roommates (as happens on craiglist), and someone—say, Google—could write an algorithm to link seekers and sellers directly, making the internet itself the marketplace. Other services feed the market with information it
Jeff Jarvis
187
needs to be efficient. Zm, for example, collects recent home sales so both buyer and seller can judge for themselves what a fair price would be. As soon as the ?rst real-estate agent (or agent’s husband, as often happens) reads this chapter, I know I’ll get an angry email or blog comment telling me I just don’t understand the value they bring. But if you must explain your value, it’s not as great as you think. With all due respect, that reaction betrays the same defensive, protective thinking torpedoing other industries covered in this book. The wiser reaction to such a challenge would be to see the opportunity in it. I’m not necessarily out to destroy agents. I want to wake them up. If you’re the smartest, most competitive agent around, you should want to leapfrog your cozy competitors, disrupt their businesses, and exploit the new opportunities online brings. Or a newcomer will. Sellers and buyers still need services. Perhaps the next-generation agent should offer them à la carte. First, sellers want buyers to ?nd their homes. That’s marketing. Agents say that’s what they offer now, but they don’t much. As I said earlier, when agents put an ad in the paper it’s to market themselves as much as the home. I’d start a company that does nothing but help market homes in the open internet, creating listings on craigslist, taking pictures and making videos, making web pages for the homes, making sure those pages show up in searches, even buying ads on Google. Thanks to Google, you can do this on your own with links to as many photos as you want (free on Google Picasa); video tours (free on YouTube and easily shot with a $100 Flip Video camera); maps to area attractions (free with Google Maps); an aerial view (thanks to Google Earth); and lists and reviews of local restaurants (thanks to Yelp, also on Google Maps). Home sellers can add links to their own favorite hangouts and best grocery stores and add tips about where the kids can play. You can sell not just the property but the experience, the lifestyle, the community. It won’t be long before you can introduce buyers to our neighbors, linking to their blogs or Facebook pages. Many homeowners wouldn’t want to do this themselves, so there’s a business opportunity to help. I’d sell these services and options for ?at fees, not a percentage of the sale price. The other problem with selling a house is hassling with tours. I’d start a company that offers concierge services to schedule and escort would-be buyers. The concierge doesn’t have to sell the house (as a buyer, I don’t need anyone to open closets and point out how allegedly large they are,
188
thank you very much). Buyers could pay the concierge to chauffeur them from home to home. Sellers could pay the concierge to hold open-houses (and make coffee and cookies)—and I think that if buyers knew they wouldn’t be trailed by sellers’ agents, they might be more likely to visit a home. I would not be surprised to see local home-tour bloggers emerge, taking tours, taking pictures, and treating new homes on the market as news. I’d read it and buy ads there. Closing is the ?nal hassle. We need to change laws to simplify the process and shift control and advantage from lawyers to home buyers and sellers. There are also technology opportunities. I’d like a mobile-phone application tied to Google Maps and global positioning so, as a shopper, I could enter my requirements—houses this large in this price range in this area—and the phone could map out a day’s house hunting, scheduling the day and giving me directions so I get to open houses at the right hour. The application could show me photos and videos. It could contact concierges, agents, or sellers to make appointments. Who wants to drive around with an agent in a high-mileage Mercedes when you can go it alone? Or maybe I’m just being antisocial. Buyers can use the tools of the web and mobile technology to research a prospective neighborhood. New services such as EveryBm list all kinds of data around addresses—crimes, building permits, even graffiti cleanings. O organizes local blog posts around locations so you can read what your neighbors are talking about. With smart searches, home buyers can get school data and local news archives. They can look up and contact Facebook users who live in the area. A neat new service called CleverCommute provides a real picture of traffic headaches. All this open data beats the agent telling you that every neighborhood is wonderful and every house has potential. Agent 2.0 will have her own rich web site showing the towns she covers and the homes she has helped to sell, with links to lots of information about the area. She’ll want Googlejuice. When I come looking for a home, I may search for someone to help me. That could be a remade agent, it could be a disruptive newcomer, or I could do it on my own. I’ll be looking for the best service and the best deal in an open and competitive market—without anyone paying 6 percent.
Money
Google Capital The First Bank of Google
Google Capital: Money makes networks
I can’t think of a Googlier industry than venture capital, and that stands to reason: Venture capitalists traffic in innovation, change, and risk. They watch what Google does, covet its success, and follow its investors. When I told venture capitalist Fred Wilson, a partner at Union Square Ventures in New York, that I was writing a book called What Would Google Do? he smiled and said, “We ask that all day long. That’s our investment strategy.” He and his partners also ask, “What would Sequoia do?” Sequoia Capital backed Google. That’s Google envy. Wilson is the Googliest guy I know in this, the Googliest industry. He was one of the ?rst VCs to blog. When he started, his competitors thought he was nuts. Venture capital was a secretive business. You didn’t want adversaries to know what you were thinking or the trends, companies, and people you were tracking. The goal was to get there ?rst; it’s a race. But Wilson bene?ted from revealing his thinking publicly. It helped him hone his ideas and attracted deals—one third of his investments come from the blog and online conversation, he says. Because of his publicness, Wilson developed a reputation online and a wider network of acquaintances who could help him do his work. When I saw him, he was about to head off for a month in Europe, where he wanted to ?nd businesses at the far reaches—Slovenia, for example. He mentioned his trip at the end of a blog post and instantly had 100 people all over Europe wanting to meet him. As he traveled, I followed his meetings via Twitter updates. “Being public and searchable and ?ndable,” he said, “is an important
190
piece of it—owning the ?rst page of your Google search, getting the brand of Fred Wilson out there.” When you search Google for Fred Wilson, the ?rst result is his blog (at m); the second and fourth are pages with his bio; the ?fth is his Wikipedia entry; the sixth is his Tumblr blog (on a platform created by a company he invested in); the ninth is his Twitter feed (another of his investments). There are other Fred Wilsons on the page: an artist who has had PBS documentaries made about him and a band by the same name. But according to Google, I was talking with the Fred Wilson. On his blog, Wilson gets to try out ideas and products using these new platforms and tools. He has driven readers crazy cluttering his blog page with too many cool new widgets. But then he invested in many of those tools. Wilson’s attitude about his blog and investing resembles mine about my blog and media: We learn, experiment, extend our reputations, and meet people. He uses his blog to help run his business; he found his latest associate through a blog post. He advises other companies to hire “net natives” who understand the new world because they live in it—and there’s no better place to ?nd them than on the net. Wilson inspired many of his competitors—mostly those who invest in the web, not in other big-iron arenas such as biotech and technology infrastructure—to start blogging. Now a score of prominent VC bloggers write posts explaining to entrepreneurs how to pitch VCs and how to run companies. This ethic of sharing carries over to the companies in Union Square’s portfolio. Wilson told me that one of his investments, Clickable, a search-engine marketing company, joins discussions on other sites just to answer questions that often have nothing to do with the company. They don’t necessarily promote Clickable. They share knowledge like good citizens of the gift economy. “Their trail is their brand,” he said. He told me about the head of another start-up who relishes getting into conversations—even with users who are angry when his service gets overloaded—because he learns so much about what users want. Web 2.0 platforms—open and inexpensive software and services that make it easy and cheap to start new sites, services, products, and companies—present both opportunities and challenges for investors. The law that says small is the new big can make life hard when you are accustomed to making big bets, as VCs do—because they also want big returns. Today, a lot of new companies simply don’t need VCs’ money and
Jeff Jarvis
191
when they do, they need less. If VCs have to invest in smaller increments in more companies, it is harder for them to manage their portfolios, which increases the cost and risk of investing. Never thought you’d feel sorry for a VC, did you? Consider O, a company started by author, journalist, and entrepreneur Steven Johnson. O organizes local blog posts and their conversations around places and topics. It makes ingenious use of Google Maps, free databases, and other open-source software. Johnson launched the service using only $60,000 from an angel investor. If he had tried to build the business even ?ve years before, he said, it would have cost $50 million. He could not have afforded, for example, to create the mapping technology Google gave him for free. To expand and hire staff, O took investment from venture capitalists, including Wilson’s fund, but that amounted to nothing near $50 million. As investments get smaller, entrepreneurs are also getting younger. Many of web 2.0’s explosive new companies—Facebook and Digg, to name two—were started by people in their 20s. “The most interesting things I’ve seen this month and this year are the creations of kids who barely shave,” Wilson blogged. This, he argued, is no accident. “It is incredibly hard to think of new paradigms when you’ve grown up reading the newspaper every morning. But we have a generation coming of age right now that has never relied on newspapers, TV, and magazines for their information and entertainment. They are the net natives. They grew up in AOL chatrooms, IMing with their friends for hours after dinner, and went to school with a Facebook login. The internet is their medium and they are showing us how it needs to be used.” They are helping to build what the internet is becoming, which is what Wilson wants to invest in. That blog post irked a bunch of entrepreneurs my age (hint: my beard is gray). But Clay Shirky defended Wilson’s thesis on youth, arguing, “The principal asset a young tech entrepreneur has is that they don’t know a lot of things. In almost every other circumstance, this would be a disadvantage, but not here, and not now. . . . When the world really has changed overnight, when wild new things are possible if you don’t have any sense of how things used to be, then it is the people who got here ?ve minutes ago who understand that new possibility, and they understand it precisely because, to them, it isn’t new.”
192
Shirky speaks for my generation when he says he knows from experience that you ?nd music in stores, try on pants before you buy them, and get news and jobs reading newspapers. “I’ve had to unlearn every one of those things and a million others. This makes me a not-bad analyst, because I have to explain new technology to myself ?rst—I’m too old to understand it natively. But it makes me a lousy entrepreneur.” Wilson responded to the fuss saying that he was not an ageist, only that he and his partners were seeing more and more young people with new ideas. “This is 15- to 20-year-old kids building and launching authentic web services that ?ll a real need in the market.” As he blogged that, he linked to a web site run by my son, Jake, who was 15 at the time and had just written and sold a few Facebook applications, one of them to another venture ?rm. On a trip to Union Square’s offices, after Wilson and his partners quizzed Jake about his net-native worldview, he advised Jake to ?nd a technology mentor and suggested David Karp, who created the tool Tumblr (a Union Square investment). Wilson warned me that Karp had left high school to start his company. High school. (My wife to our son: “Don’t you even think of it!”) How do investors meet entrepreneurs from a different generation? I think they need to operate in more open networks with more stakeholders at the edges. VCs are still a chokepoint of control: They raise money from investors; they pick and manage relationships with start-ups; they pay investors and keep their share. They are middlemen and Google makes detours around middlemen. As VCs are stretched thin—making more and smaller investments—it’s harder for them to stay in the middle. It’s also harder to ?nd and evaluate new companies. I get a headache reading the popular blog TechCrunch, which covers new web 2.0 companies, because I can’t hope to keep track of them all: mobile companies, social companies, companies dedicated just to managing blog comments. The low cost of launching and running new enterprises means they can serve niche needs in a small-is-the-new-big age. But the barrier to entry to competitors is also about a millimeter off the ground. It’s harder than ever to ?gure out which of many competitors in a space will win. So investors need to use a wider network of trusted people to help ?nd and then manage new companies. Taking investment capital from these trusted agents and giving them a share of the pro?ts if their ?nds pay off could form a network of miniVCs backed by the bigger VC. A variant of
Jeff Jarvis
193
this model is New York Angels, a group of 65 successful investors who judge early-stage companies together. Incubators take a more active role in getting companies off the ground. Holtzbrinck, a publishing conglomerate based in Germany, runs a lab that starts some companies and invests in others, then decides whether to buy them. Idealab, founded by nonstop entrepreneur Bill Gross, has launched a large number of companies as an incubator, including Overture (which became the basis for Yahoo’s—and, indirectly, Google’s—search-ad industry), PetSmart, Picasa (now Google’s photo software), Citysearch, and the electric-car company Aptera Motors. Both incubators provide space, office services, advice, and money. Then there is a series of next-generation incubators built to advise and invest in new web 2.0 enterprises. These include Y Combinator, which funds small entrepreneurs and helps them get from idea to company; Seed Camp, which runs regular competitions for start-up help in Europe; and Betaworks, which funds and advises early start-ups. Investors still need to reach into the dorms at MIT and Stanford—or farther back into my son’s high school—where ideas are hatching. I decided to teach because I was no longer able to effect enough change in a media company and ?gured I could do more in the cause of innovation helping students as inventors. At the City University of New York, I started a class in entrepreneurial journalism to prove that’s not an oxymoron and to teach journalists business. My students create business plans for sustainable journalistic enterprises and, thanks to a grant from the McCormick Foundation, the class funds the best of them with seed money. Underlining Wilson’s observation about age, my students do best when they think like young people. They fail when they try to think like graybeards. It is sometimes the graybeards who point this out to them. Jim Kennedy, head of strategy for the Associated Press, heard all my students’ presentations and then told them he was disappointed that they had all proposed web sites. He said “web site” practically with disdain, as one would say “disco.” He inspired one student, who wanted to start an online magazine for teen girls, to shift from the web to Facebook. She had to think differently. Entrepreneurship is spreading among youth. There’s a blog for young capitalists called College-Sm (tagline: “Get rich from your dorm room”). A 2007 Harris Interactive survey on entrepreneurship commissioned by the Ewing Marion Kauffman Foundation found that 63 percent
194
of youths between 8 and 21 years old said they had the ability and desire to launch businesses, and 40 percent planned to do it. Thank goodness for the arrogance of youth. Perhaps venture capitalism should start to look like a classroom: VCs could provide not just funding but also education (which some do in their blogs). If I were a VC, I’d reach out to colleges and offer to help talented entrepreneurs, dangling seed money for those with great ideas. I might open my doors as an incubator and offer free help to great business ideas so I could invest in some of them. (We will discuss other ways to nurture innovation in colleges in the chapter, “Google U.”) Or perhaps venture capital could look more like an open marketplace. When I asked mega-entrepreneur Gross how he’d make his ?eld Googlier, he said: “I’ve always thought there should be a better start-up marketplace, almost like a mini stock exchange for start-ups, open only to quali?ed investors. But open up all the information and make it more even and transparent.” The problem for founders and employees is that they can’t take money off the table, as the saying goes, until a company is sold or goes public. A high-end marketplace of private start-up equity would let them sell a little stock to buy their Beemers but still keep working. Facebook did that in 2008 by enabling employees to sell stock to each other. Gross, the entrepreneur’s entrepreneur, would like to start a company to build such a marketplace. Can large companies spark entrepreneurism in their ranks? Google, of course, invests in internal innovation through its 20 percent rule. Google also buys innovation when it acquires companies. Apparently that hasn’t been sufficient, for Google surprised the investment community when it started its own venture fund in 2008. When I worked in large companies, I saw how hard it was for them to invest in start-ups. Investing requires different skills. Finding start-ups comes from networking. Managing the relationship is more like teaching. And big companies need the patience to let investments grow on their own paths and timetables. Still, supporting innovation is vital in any industry and any company you can name. Rather than implementing 20 percent rules, perhaps companies can ?nd innovators within their ranks by offering grants to entrepreneurial employees in return for equity. Perhaps universities can help. I am working to start an incubator for the news industry inside my university.
Jeff Jarvis
195
Venture capital’s goal is to ?nd talented people with good ideas and to give them the resources they need to execute those ideas. If I were a venture capitalist trying to think like Google, I’d ?gure out how to build a platform for entrepreneurship. I’d be as open as Fred Wilson with my ideas and hope to attract many more. I’d consider being a matchmaker more than a middleman, sometimes connecting investors and start-ups directly and trying not to get too much in the way. I’d rely on a large, distributed network of trust to help me ?nd and manage investments, rewarding people in that network. I’d put together networks of start-ups that could help each other, whether I invested in them or not. I’d assume that just as it has gotten easier and cheaper to create content and media, it will get easier to create other kinds of companies. I’d manage abundance. All that, of course, assumes that I have an abundance of money. I don’t. Oh, well.
The First Bank of Google: Markets minus middlemen
Banking is the ultimate middleman business, pooling money and need and pro?ting on the connections. In small ways—as in small is the new big—the internet is already disintermediating the industry by making direct connections. Take peer-to-peer lending. At Pm, as of 2008, 750,000 members had borrowed and lent more than $150 million in amounts as small as $50, supporting anything from launching new businesses to paying off college loans to getting out from under credit card debt. It’s wonderfully simple and magni?cently human. You see the person and the story: “It has been my dream to open a Neapolitan Pizzeria ever since I moved to the United States 9 years ago. I decided to start small at ?rst and open a small food cart, and expand from there. . . . It is time we expand our little food cart to a full-size pizzeria.” I wanted to invest in that one. Another: “This loan will be used to start a part-time business doing cooking classes for Raw Foods.” What? Cooking raw food? I thought I’d pass on that. Then there was a student who wanted help to pay for her last year in college. “I work a full time job as well as go to school. I currently have a GPA
196
of 3.9 overall. I am obtaining my degree in Accounting and Financial Management and understand the importance of paying your bills on time and maintaining a good credit score.” OK, she sold me. Prosper advises users to diversify loans in case some default (it sends out the collection agency). Though the interest rates run high, this is no way to get rich or to build the new Bank of America. But it is compelling and entertaining. Prosper turns the most impersonal industry there is into a real-life reality show ?lled with dreams and winners and losers. Other variations on the theme: Zopa sells certi?cates of deposit and gives investors a voice in lending the money. Loanio is supposed to make loans safer by involving cosigners and getting more documentation. Virgin Money handles the details in loans among friends and family. Lending Club makes loans social via Facebook. Microloans are better-known—and tend to go to better causes—in developing economies, where they are used to buy cattle to start a business or to send a child to school. Go to dhanaX.com to see stories in India— where only Indians may invest—or to Kg, where you can grant loans as small as $25 to businesses all over the world. Kiva has made $35 million in loans—averaging $485 each—in 43 countries, and 98.1 percent have been paid back. (For comparison, 2.7 percent of prime loans in the United States were in default in the spring of 2008; subprime loans saw 16.6 percent in default.) One Kiva request: Mrs. Phally of Cambodia raises pigs at her home, making $7 a day, while her husband farms, earning $5 per day. The family is also supported by two of their children who work in the local garment factory. Mrs. Phally asked for a $1,000 loan to buy a small tractor for her husband to plow his land. Adding context, Kiva tells us it is common for Cambodians to rent out tractors to make extra income. Kiva’s loans earn no interest for the lender, but local administrators charge interest. These loans change the world one entrepreneur at a time. That is an internet dividend. To make a similar impact in the United States, a bit at a time, see DonorsCg, where you can contribute to teachers’ needs. See also Facebook’s Causes application, where members start, join, support, and donate to causes. All these new entities rely on small bits adding up to big impact, on direct and personal connections, on giving control of the use of resources to those who have them, and on open information. The root of the credit crisis that spread from America around the globe
Jeff Jarvis
197
in 2008 was that bad loans were hidden in packages with good loans and sold to ?nancial markets, with no accountability down to the level of each loan and no transparency. That’s not the case in these peer-to-peer loan operations. I don’t mean to pretend that the social banking system could replace banks, but banks could learn a lot from it. Why not set up direct marketplaces that let me establish my own diversi?ed portfolio in smallbusiness loans, home mortgages, and student loans? Why not use the infrastructure the bank has, as Virgin Money and PayPal do, to facilitate our own ?nancial transactions? Why not make banks human again? We may not see such an evolution in big, old banks—they’re just too big and old. That is why we are seeing new and innovative, peer-to-peer banks and ?nancial institutions emerge. But there can be no question that the industry needs both more transparency and more accountability. The internet also presents new opportunities for ?nancial markets. Online we have new sources of information and analysis about companies other than the con?icted analysts who work for ?nancial institutions. Investors themselves can share knowledge, data, strategies, successes, and failures. The Motley Fool’s CAPS service pools investors’ knowledge to help each member of the community. I invested in Covestor, where stock investors share their veri?ed trading history and others will be able to invest alongside them. Any investor can become his own mutual fund and a winning investor has another way to bene?t from betting well. In my entrepreneurial journalism class, Shirky advised students working on a personal ?nance site to offer a branded credit card, enabling them to aggregate data from the community to let people know where they stood against peers: “Warning—you are spending 15 percent more on restaurants than people your age with your income.” Learning from lots of data is a pillar of Googlethink. Banks and credit cards know more about our spending than anyone and almost as much about our buying as Amazon. That’s our data as individuals and our wisdom as crowds. I wish they’d turn it over to us so we could use what we learn from it to manage our ?nances. Of course, banking and ?nancial markets are regulated for good reason—not closely enough, judging by the results of the credit crash. We need to tread with caution in these areas. But the web presents new ways to think and do business, even in the stodgy old business of handling money.
198
I’m surprised the web hasn’t had a greater impact on the industry already. Every time I see a new retail space being built in my area, I get depressed when I see a bank move in. How useless. How unfun. I’d prefer another Starbucks or a Taco Bell or maybe an old-fashioned bakery. Why are banks still in the business of building so many retail outlets out of bricks and ?lling them with staff? When the internet arrived, so did some online-only banks, but they never ?ourished and many were bought up: in the U.K., Egg was acquired by Citi, First Direct by HSBC. They didn’t offer us enough incentive to change our habits. If online banks had passed savings onto us—the internet dividend in cash—maybe we’d have been motivated to go virtual. The cashless society will probably come to the U.S. a day after the paperless office does—that is, never. We keep hearing about people in Finland and Japan buying Cokes and paying for parking with their mobile phones, but we haven’t seen that happen in the States. Microsoft wanted to become the cash register of the web with its Passport service, but I think no one trusted Microsoft to handle our money. Google’s Checkout service has not caught on. PayPal, now owned by eBay, has become an easy way for people to exchange cash, but too few merchants use it. Maybe we need a new virtual currency all the world could share that could become the basis of new ?nancial systems. How does Googlebucks sound? In Google we trust.
Public Welfare
St. Google’s Hospital Google Mutual Insurance
St. Google’s Hospital: The bene?ts of publicness
Too often when I ?nd myself in a discussion about citizen journalists, some member of the press’ curmudgeonly class—thinking himself quite clever and apparently believing he just thought of this himself—will growl at me: “Why should I trust a citizen journalist? You wouldn’t want a citizen surgeon, would you?” No, I wouldn’t. But I do want health care to open up to the Google age and take full advantage of the opportunities it presents to gather and share more data; to link patients with better treatment and information; to connect them with fellow patients in a community of shared experience and need; and to use the potential of collaborative tools and the open-source movement to advance medical science. On my blog, I have violated the most sacred tenant of privacy advocates: I revealed and discussed my personal health information, writing about my bouts of atrial ?brillation (a sometimes irregular heart beat—I’m ?ne, thanks). I have received great bene?t from opening my medical history to my readers. Fellow patients have given me support, sent me links to resources, shared their experiences about treatments I’ve considered, and sent me updates on companies working on new treatments. Even Google’s Sergey Brin blogged that he had learned he carried a gene mutation that may indicate a propensity for Parkinson’s disease. Imagine how valuable it could be for us patients to go to a site to record
200
our conditions and activities right before the onset of a?b (the familiar name for the condition). In some people, too much food, wine, stress, or activity can trigger an attack; in others, these have no effect. Doctors have some of this data already, but only from limited samples. If millions of patients around the world shared their experiences, would we discover new triggers, new correlations, new causes, even new treatments? Don’t know. But we can’t know until we try, until we open up and provide the means to gather the information and analyze it. PatientsLikeMe has created a platform for communities around a stilllimited set of conditions, including multiple sclerosis, Parkinson’s disease, depression, and post-traumatic stress disorder. I spoke with the husband of a woman who, months before, had been diagnosed with MS. He said the site has been invaluable, providing information, experience, and support. The 7,000 MS patients in the group—growing by more than 700 a month—categorize themselves by symptom and treatment and submit narratives and quantitative data: We can see that 395 patients took a particular drug for fatigue; 23 stopped taking it because the side effects were too severe, 21 because it didn’t seem to work, and 14 because it was too expensive. This experiential data is a goldmine to a patient trying to learn about and take greater control of her treatment. It is also valuable to the medical industry. The company explains that its operating costs are covered by “partnerships with health-care providers that use anonymized data from and permission-based access to the PatientsLikeMe community to drive treatment research and improve medical care.” When we share information in a network, all its members may bene?t. To build these networks, we need to think of health as a public story and rethink certain inhibitions to publicness. We are not motivated to be open when insurers or employers can reject us due to preexisting conditions. Not that I want to push a political agenda, but universal health care would solve much of that problem. Even then, I’m not suggesting that everyone reveal all their ailments. I understand if you don’t want to talk about yours. But there could be bene?ts if you do. Health is just one illustration of how the internet’s ethic of publicness could have a subtle but profound impact on how we live. In 2008, Google started a health service online (at m/health) where users can enter their conditions and the drugs they take as well as
Jeff Jarvis
201
results of tests, such as cholesterol screening, which they may download from a limited number of health companies that have signed up so far. Patients’ information is not meant to be public, though a few of us online folks have wished that we could publish our own pages openly so we could reap the bene?ts of medical networks. Google’s purpose is to give users more information (it feeds me news stories about a?b) and to put users in control of their own information, because they have too little control now. There is a movement afoot to standardize personal health records. It is related to another movement to create systems where customers control relationships with vendors—called vendor relationship management (VRM), the mirror image of customer relationship management (CRM). VRM is being spearheaded by pioneering blogger Doc Searls, a fellow at Harvard’s Berkman Center for Internet and Society. I view what he’s doing, shifting control to customers, as Jarvis’ First Law brought to life. Searls, who’s not an M.D., turned his VRM attention to health after spending a tortuous week in the hospital with pancreatitis, which he chronicled from his bed on Twitter and then on a blog. He complained about the lack of information he had, which led him and his doctors to ill-informed decisions that exacerbated his condition. “I believe the closed and proprietary nature of health care is itself a disease that needs to be cured,” Searls said as he linked to another blogger, Fred Trotter, who illustrated the problem of getting control of our own health information. “Let’s imagine that I had some kind of life event that would require me to gather those records together,” Trotter blogged. “To do that, I would need to call every doctor I have ever visited, and request a copy of my records.” Those doctors would all want to fax him records. “Faxing over phone lines is the ‘health exchange network’ that we have in the United States,” Trotter said. He would end up with a giant pile of documents that is not searchable, is hugely redundant, and is not easily read. His doctor is unlikely to spend the time needed to sift through it all looking for that nugget of a clue. Searls argues for open standards in medical information to organize data and put it under patients’ control. He compares the task to the creation of the internet itself (or as I would put it, bringing Googlethink to medicine). “We cannot ?x health care only at the institutional level,” he
202
blogged. “No company and no government agency can ?x health care, any more than any company or government could ?x networking or computing. Those had to be ?xed by hackers building solutions for everybody and not just themselves.” Searls hopes to look back in his lifetime and see that health care was reformed from the bottom up thanks to the open-source infrastructure of the internet. He also hopes to see new businesses created “atop patients as platforms.” Now apply this attitude—this ethic of openness, standards, and hacking—not just to medical care but also to medical research. How much of pharmaceutical work would bene?t if more data were open and more of the work were open-source? We’ve heard the arguments: The cost of developing drugs is astounding and unless companies that create them can fully own the information and the results and recoup the expense, they won’t discover the next pill that could save your life. I don’t disagree; I respect their work, their business needs, and their intellectual property. Still, we need more discussion on the impact openness could have on medical research. Would the government need to sponsor more research so the results would be open? If universities, governments, and doctors shared their data in standard, open, and free databases—with patients encouraged to add their knowledge and experience—would that have a greater bene?t than the current, less-transparent structure? If more research were made open, what drugs and businesses could result? Who could organize that knowledge for us? Google has opened up most human knowledge today—any that is digital and searchable—so I’m con?dent it could do the same with medical knowledge. Like Searls, I hope to live to see that day. Medicine is still too much a priesthood of closed knowledge, at least as it relates to patients. In 2008, I sat with doctors from around the world at a conference lunch as they clucked, scowled, and shook their heads and shared stories of their patients going to the internet and coming back with incomplete or mistaken information. These doctors wished that their patients hadn’t done their own research and that the doctors, as experts, could have kept control of access to information. Well, too late. I advised them to curate good information for their patients. What if they created resource sites? What if they blogged to keep patients informed and upto-date—and also linked themselves with a larger community of doctors
Jeff Jarvis
203
working on the same conditions? If their patients got more of the right information, would that make them better patients? A bit grudgingly, the doctors accepted the notion. I’ve debated my prescriptions and treatments for a?b with my doctor and what I really want from him is data and information about my choices to make better decisions together. I’m no citizen cardiologist, but it is my heart. I want more information to be made public about doctors as well. It is possible to get survival rates for hospitals performing certain procedures (though sadly, keeping these scores sometimes disincentivizes institutions from taking hard cases). Patients rate doctors—like teachers and plumbers—at various online services, but they’re not terribly helpful because I don’t know anything about the people leaving comments. I’d at least like to get a list of all the conditions a doctor treats and how often so I can pick the most experienced specialist. If a Googley restaurant would tell me how many diners ordered the crab cakes, a Googley doctor should tell me how often she has treated a?b. I would also be impressed if the doctor treating me had written about the condition online. I’d be doubly impressed if I saw other doctors linking to her. The changes in medicine we’ve touched on all relate to information: opening it up, sharing it, organizing it, analyzing it, bringing the network effect to the industry and our health. That is Google’s specialty.
Google Mutual Insurance: The business of cooperation
As I was researching this book, I wrote on my blog that I had come up against a few industries I thought were immune from reform through Googli?cation. Insurance topped my list (we’ll get to the others shortly). Insurance is built on getting us to take a sucker bet—a bet even we want to lose. Nobody wants a reason to collect collision, ?re, ?ood, health, or certainly life insurance. Worse than Vegas, we know that insurance companies stack the deck against us; that is the foundation of their business. If we don’t collect, we are losers (we’ve lost our money). If we do collect, we’re still losers (something bad happened). If the insurance company pays out too much and goes out of business, then those of us who
204
paid in still lose. We can’t win. The industry has to suspect that we are liars, making us prove our misfortune and reluctantly giving us back the money we put in the pool. They make the economics overcomplicated so we don’t know just what suckers we are and so we keep making safe bets—safe for the insurance company. Our relationship with insurance is, therefore, necessarily adversarial and built on mutual mistrust. How incurably unGoogley. My readers disagreed. A few dozen of them left comments on my blog arguing that insurance can reform, and they showed me how. Here are excerpts from the conversation and my education. (Let this chapter be an object lesson in the power of open, collaborative thinking.) The ?rst comment came from Seth Godin, author of Purple Cow, Small Is the New Big, Tribes, and other business best sellers, who scolded me: “Think bigger, Jeff!” He provided a few examples of social insurance. First:
20 Korean families pool ?nances and open businesses one at a time . . . each member of the group has a huge incentive to help each business succeed, so they can get the money when it’s their turn. Imagine insurance being created in a coordinated fashion, with each member of the coop working to decrease the risk of everyone in the pool.
A commenter from France, Bertil Hatt, said the Mutuelle Assurance Instituteur France (MAIF) lives by some of these principles of mutual bene?t, providing insurance as well as services, such as home and child care. Premiums are higher than average, she said, but lower for the young, the poor, and students. “How can they make it?” she asked. “Thanks to an implicit contract: When you get richer, you stay with them not only for the service, but because you believe in their way.” Insurance becomes a collective, though private, good. Godin next talked about smart devices that might need less insurance. Cars with better brakes can cost less to insure if they keep us safer and also cost less to repair and to warranty—which, again, is a form of insurance. Godin took the idea a step farther and suggested that “smart products come with their own insurance because they’re so much better and talk to each other.”
Jeff Jarvis
205
When cars know where they are and where trouble might be, or when they integrate with each other and their drivers and the roads and the police, shouldn’t insurance get better?
Right. The network becomes a form of insurance as connected devices can be monitored, repaired, and improved and can learn to do their jobs better and more safely. In the comments, Chris Cranley took off on Godin’s idea and suggested that just as smarter products may need less insurance, the same may be said of smarter people: “If I knew how to avoid problem X, I would not insure against it.” Education and information become insurance against insurance. Godin took this line of thinking to its extreme when he speculated about opportunities not just for smarter people but—genetically speaking—healthier people as determined by 23andMe, a service that analyzes users’ DNA. (Founded by Brin’s wife, Anne Wojcicki, 23andMe discovered his Parkinson’s gene. Google invested in the company.) Godin said:
And while some may not like it, what happens when 23andMe gets a lot smarter and the healthiest gene pool starts their own life insurance coop?
U.K. business journalist James Ball agreed with me that insurance is “a glori?ed betting market” where insurance providers “offer odds against certain outcomes—adverse outcomes—and we pay up the stake. The similarity between insurance providers and bookmakers stack up easily.” His comment added that open betting exchanges had shattered bookmakers’ control over odds and premiums and could do the same in insurance. “There’s no built-in reason for ‘social’ insurance to fail,” he wrote. “In fact, it could work quite well.” Ball was arguing, as I have many times in this book, that the power of open information will make markets more efficient. He gave me a dose of my own medicine and I had to agree. But still, I argued in response, there is the issue of fraud: People try to rip off insurance companies and that can undercut communities and markets built on trust. Ball replied that fraud is less of a problem in some cases. “Let’s suppose we have insurance against burglary by requiring the crime to be reported before paying out,” he wrote. That requirement gives insurers a measure of security. He continued:
206
Risky, or trusting, insurers could offer worse “odds” with less requirement for proof in the event of a claim. By treating insurance as any other betting market, we’d effectively be insured by many small stakeholders. Cleverer yet, the marketplace could take a cut of premiums in some markets (say 5 per cent?) and use this to audit a random percentage of claims, for particularly risk-averse insurers, or for markets particularly sensitive to moral hazard.
Ball said his insurance marketplace would use technology and the theory of social networks to rely on transparency more than trust. He concluded: “Health insurance would certainly take some thought. But then again, I’m in the U.K., so not a problem for me.” Rub it in, why don’t you, James? Shaun Abrahamson, a friend and former colleague, piped in to the comments, pointing out that the original insurance companies, like credit unions, “would have been recognizable as precursors to social networks.” Then he pushed the social envelope in the discussion: “To James’ point on betting and odds-making, do you think groups of people who know one another might outperform actuaries in assessing risk? Do you think it would be easy to defraud a network of people who know each other via friend-of-a-friend type connections?” In other words, if a community insures itself, are there social disincentives against screwing friends and neighbors? Ivan Pope, a U.K. web entrepreneur, echoed Abrahamson and told me my premise was wrong. Insurance, he said, is inherently social.
In the same way that mutual societies and co-operative societies are all social, so insurance is a social contract. We all put in a bit and the ones who need it draw down from the pool. Sure, we privatised the management of it, gave away the pro?t, turned it into a huge scale business. . . . So we need some imagination, some ambition and some skill to build these back again as social communities.
Scott Heiferman, founder of Meetup, also brought historical perspective to the discussion, writing a brief manifesto for change in the coming
Jeff Jarvis
207
decade, chock full of hip blog references (the “social graph” to which he refers is what Mark Zuckerberg calls the architecture of personal connections on Facebook):
Historically, when people are free to assemble & associate, they self-organize insurance, cooperatively. Later it became the centralized, professionalized industry we know today. I predict there’ll be some kind of massive craigslisti?cation of insurance by April 27, 2018. It’s about de-institutionalization—not from the government borg (social security), not from the corporate borg (AIG). The New Social [graph] Security. Decentralized, self-organized. Not just DIY, but DIO (Do It Ourselves). That is the big theme for everything now.
There is the great promise and power of the Google age: DIO. In the end, commenter Gregory Lent summed up the ideal for the Google age, saying that the web 2.0 social network
will blow up insurance, because it will transparently link the whole system, insured, insurers, providers of the service that insurance is paying for. no place to hide, accountability everywhere, prices will drop, pro?ts/savings more evenly dispersed. best thing that can happen.
Tie all this together and we can begin to draw a picture of a disruptive insurance enterprise that empowers a community by handing over control of insurance to the members of that community. I played out this scenario for a couple of insurance executives who said I may be mad but the ideas are good. Imagine a forward-looking company—Google, for example—creating a new insurance compact: If the community makes itself healthier and lowers the costs—and raises the effectiveness—of its own care, the cost of insurance will fall. The deal would motivate the community to pressure its members to become healthier and smarter. Insurance companies today try to get us to act healthier, pushing us to join health clubs or eat smarter. But—apart from our feeling better—the direct economic bene?t on medical costs is almost entirely the insurance company’s and we never see a
208
transparent accounting of the impact. The insurance 2.0 compact puts the community in charge and gives it mutual bene?t and responsibility. Giving the community control means giving it information. The insurance company would need to give members complete disclosure about actuarial data, costs, and pro?ts. The insurance company would also need to pressure doctors to hand over data about their work so community members could make smarter decisions about treatment. The community, in return, needs to manage its health care, including keeping an eye on health providers. For example, my medical group makes me come in every four weeks to get checked for the blood-thinning drug I take because of my a?b. My results never vary. Every time I’m there, I’m amazed at the inefficiency I see: two nurses making a big show out of pricking a ?nger (which some diabetics do on their own a half-dozen times a day). The medical group pro?ts from my copay and from my insurance company’s fees. It’s a waste. I’m not motivated to do much about it. I have no relationship with the insurance company except mutual distrust and inconvenience. I would get nothing out of protesting or whistleblowing. If my community and I were in charge of our health care and insurance, that would be different. I’d make it my business. The community also might choose to sponsor races, diets, and classes and pay for that out of its pool of premiums if it believes the bet on health will pay off. It might offer services such as the French MAIF’s home and child care if the group believes it is worth the cost. That becomes the community’s decision. What emerges is a community whose members want to maintain better health at lower cost and risk through mutual bene?t. They are able to do this because the new insurance company provides a platform with tools, information, and organization to help the community meet its goals. The insurance company’s not in charge. The community is. It’s a vision of insurance that follows many of Google’s rules and starts with Jarvis’ First Law. This vision came from my readers. They applied the internet’s new ways to old problems to see what could be improved. They believed that more transparency in marketplaces would yield greater value. They believed that adding social elements—the interests and pressures of a community—would increase value. They told me that handing control to
Jeff Jarvis
209
the market would increase trust, and insurance is about trust. So they proposed networks of mutual need and service that diminish if not eliminate the middlemen. I’m proud to say that I didn’t come up with these ideas. My generous readers did. They were my insurance against an empty chapter.
Public Institutions
Google U The United States of Google
Google U: Opening education
Who needs a university when we have Google? All the world’s digital knowledge is available at a search. We can connect those who want to know with those who know. We can link students to the best teachers for them (who may be fellow students). We can ?nd experts on any topic. Textbooks need no longer be petri?ed on pages but can link to information and discussion; they can be the products of collaboration, updated and corrected, answering questions and giving quizzes, even singing and dancing. There’s no reason my children should be limited to the courses at one school; even now, they can get coursework online from no less than MIT and Stanford. And there’s no reason that I, long out of college, shouldn’t take those courses, too. You may suspect that because I’m a professor, I’ll now come out of this litany of opportunities with a rhetorical ?ip and demonstrate why we must preserve universities as they are. But I won’t. Of course, I value the academy and its tradition and don’t wish to destroy it. But just as every other institution examined in this book is facing fundamental challenges to its essence and existence in the Google age, so is education. Indeed, education is one of the institutions most deserving of disruption—and with the greatest opportunities to come of it. Call me a utopian but I imagine a new educational ecology where students may take courses from anywhere and instructors may select any students, where courses are collaborative and public, where creativity is nurtured as Google nurtures it, where making mistakes well is valued
Jeff Jarvis
211
over sameness and safety, where education continues long past age 21, where tests and degrees matter less than one’s own portfolio of work, where the gift economy may turn anyone with knowledge into teachers, where the skills of research and reasoning and skepticism are valued over the skills of memorization and calculation, and where universities teach an abundance of knowledge to those who want it rather than manage a scarcity of seats in a class. Who’s to say that college is the only or even the best place to learn? Will Richardson, who teaches fellow educators how to use the internet in the classroom, wrote an open letter to his children, Tess and Tucker, on his blog, Wm: “I want you to know that you don’t have to go to college if you don’t want to, and that there are other avenues to achieving that future that may be more instructive, more meaningful, and more relevant than getting a degree.” He said education may take them to classrooms and lead to certi?cation but it also may involve learning through games, communities, and networks built around their interests. “Instead of the piece of paper on the wall that says you are an expert,” he told his children, “you will have an array of products and experiences, re?ections and conversations that show your expertise, show what you know, make it transparent. It will be comprised of a body of work and a network of learners that you will continually turn to over time, that will evolve as you evolve, and will capture your most important learning.” If that is what education looks like, what does a university look like? I asked that question on my blog and entrepreneur and technologist Bob Wyman (who works for Google) responded by abstracting the university and identifying its key roles: teaching, testing, and research. I’ll add a fourth and unofficial role: socialization. Let’s examine them in reverse order. Socialization is, of course, a key reason we go to college and send our children there. Adults see college as a process of maturation and increased independence and responsibility. Students, on the other hand, may see it as a process of getting away from the parents. Whatever. Jeffrey Rayport, a consultant and Harvard Business School professor, sat with me in the Harvard Club in New York and told me it was designed by a graduate of the university who didn’t much care for the school’s harsh Cambridge atmosphere. In the club, he created what he wished Harvard had been:
212
warm wood and ?res, Harry Potter without the pomp and kitsch, the experience—the Disney World—of education. I do think there is a time to have that experience and live with our peers. Old people do. My parents live in Sun City Center, Florida, a town where one legally may not reside if under the age of 55. Why not have youth towns where residents are evicted by age 30: Melrose Place University? But seriously . . . if one has the luxury of time and resources to explore the world before buckling down to a job and a mortgage, great. That exploration can take the form of backpacking around Asia, hanging out in a dorm, or joining the Peace Corps. Or these days, it may mean starting a company. Our young years may be our most creative and productive. Bill Gates, Mark Zuckerberg, and the Google boys dropped out of school at various stages to start their corporate giants. Should we be forcing young people to go through 18, 16, or even 12 years of school—trying to get them all to think the same way—before they make things? Instead of the perennial call to subject our youth to mandatory national service—how’s that for a way to squander a precious resource?—shouldn’t we instead be helping them ?nd and feed their muses? Perhaps we need to separate youth from education. Education lasts forever. Youth is the time for exploration, maturation, socialization. We may want to create a preserve around youth—as Google does around its inventors—to nurture and challenge the young. What if we told students that, like Google engineers, they should take one day a week or one course a term or one year in college to create something: a company, a book, a song, a sculpture, an invention? School could act as an incubator, advising, pushing, and nurturing their ideas and effort. What would come of it? Great things and mediocre things. But it would force students to take greater responsibility for what they do and to break out of the straitjacket of uniformity. It would make them ask questions before they are told answers. It could reveal to them their own talents and needs. The skeptic will say that not every student is responsible enough or a self-starter. Perhaps. But how will we know students’ capabilities unless we put them in the position to try? And why structure education for everyone around the lowest denominator of the few? Another byproduct of a university’s society is its network—its old-boy network, as we sexistly if accurately called it. That club has long held value
Jeff Jarvis
213
for getting jobs, hiring, and making connections. But now that we have the greatest connection machine ever made—the internet—do we still need that old mechanism for connections? LinkedIn, Facebook, and other services enable us to create and organize extended networks (any friend of yours . . . ) springing out of not just school but employment, conferences, introductions, even blogs. Members of Skull and Bones at Yale and graduates of Harvard Business School may object, but as an internet populist, I celebrate the idea that old networks could be eclipsed by new meritocracies. Facebook didn’t just bring elegant organization to universities, it could supplant them as a creator of networks. The next role of the university will be harder to nurture in a distributed architecture. Research, pure and directed, are values of the academe that the marketplace alone may not support. Unless it has a market value and is paid for by a company, research must be subsidized by foundations, endowments, donations, and tax dollars—and often by the generous passion of the researcher. That will still be the case. The question is whether research will be done in schools or in think tanks and whether it will be performed by professors or by paid thinkers. There’s little reason that research must be performed on campuses by academics and little reason why those academics cannot work in wider networks. Research has long been a process more than a product as papers are peer reviewed and research results are replicated. That is even more the case now as research is opened up online in web sites, blogs, and wikis and as their contents are linkable and searchable via Google (which provides a search service for academic works at scholar.Gm). This openness invites contributions, collaboration, and checks. The next role of the university is testing and certi?cation: the granting of degrees and anointing of experts. The idea of a once-in-a-lifetime, one-size-?ts-many certi?cation of education—the diploma—looks more absurd as knowledge and needs change. Are there better measures of knowledge and thinking than a degree? Why should education stop at age 21? Diplomas become dated. Most of what I have done in my career has required me to learn new lessons—long past graduation—about technology, business, economics, sociology, science, education, law, and design. Lately I’ve learned many of these lessons in public, on my blog, with the help of my readers. That is why I urge other academics to blog and be
214
challenged by their public. I believe that should count as publishing. Blog or perish, I say. Our portfolios of work online, searchable by Google, become our new CVs. Neil McIntosh, an editor at the Guardian, blogged that when he interviews young candidates for online journalism jobs, he expects them to have a blog. “There’s no excuse for a student journalist who wants to work online not to have one,” he wrote. “Moreover, the quality of the blog really matters, because it lets me see how good someone is, unedited and entirely self-motivated.” Our work—our collection of creations, opinions, curiosities, and company—says volumes about us. Before a job interview, what employer doesn’t Google the candidate (a practice banned by law in Finland, by the way)? Our fear is that employers will ?nd embarrassing, boozy pictures from spring break, but that’s all the more reason to make sure they also ?nd our blogs and collected works. Sometimes employers will require certi?cation. That, as Wyman says, is where testing comes in: exams to make sure our new doctors, lawyers, and PC support staffs know their stuff. But these exams are often given by professional organizations—medical boards and the bar—rather than schools. Preparation for those tests is undertaken by test-prep and commercial-education companies such as Kaplan. Universities ceded the market to them. Still, testing makes sense; it is our guarantee against the citizen surgeon (or that the citizen is quali?ed). It does make more sense to test students after they’ve learned a subject than before. Tests given before education commences—entrance exams—might better serve students if they discovered not what students know but rather what they need to know. Between SATs and exams mandated by No Child Left Behind laws in the U.S., we are succumbing to a tyranny of testing that commodi?es learning. The system tries to turn out every student the same. Finally we arrive at the core, the real value of a university: teaching. Here I violate my own ?rst law when I say that complete control of one’s education should not always belong to the student. For when we embark on learning, we often don’t know what we don’t know. Or in Google terms, we don’t know what to search for. The teacher still has a role and value: If you want to learn how to ?x a computer or operate on a knee or understand metaphysics, then you hand yourself over to a teacher who crafts a syllabus to guide your understanding. When it’s clear what you want to learn—
Jeff Jarvis
215
how to edit a video with FinalCut, how to speak French—it’s possible for a student to use books, videos, or experimentation to teach herself. The internet also makes it easy to connect teachers with students—see TeachSm, which in only two cities has 55,000 teachers, trainers, tutors, coaches, and classes, according to Springwise. I wouldn’t go there to learn surgery, but I might to get help with my stale German. One bene?t of the distributed, connected university is that students may select teachers. Instructors won’t be able to rest on tenure (I speak as someone who has it) but must rise on merit. Today, instructors are graded on sites such as RateMyTm, but students are still prisoners to their school’s faculty. If they could take courses from anywhere, a marketplace of instruction would emerge that should lead the best to rise: the aggregated university. Instructors could also pick the best students. A class would become a handpicked team that might research a topic as a group, blog their collective process of discovery, or write a textbook and leave a trail of their frequently asked questions and answers for the next class or the public (what are courses but FAQs?). That product will be searchable and may provide a way for future students to ?nd and judge courses and instructors. It’s educational SEO, bringing the internet’s ethic of transparency to the classroom. There could be new models for education. One might be education by subscription: I subscribe to a teacher or institution and expect them to feed me new information, challenges, questions, and answers over years. Many schools give graduates refreshers and updates in skills; at the City University of New York Graduate School of Journalism, we call this offer our 100,000-mile guarantee. Education could be a club more than a class: We join to learn and teach together, sometimes handing the teaching duties to the best student on a given subject. Peer-to-peer education works well online as we can see in language-learning services such as Livemocha, where teachers in one language become students in another and where anyone in its gift economy can critique and help any student. It is a learning network. In the classroom, real or virtual, Google forces educators to teach differently. Why are we still teaching students to memorize facts when facts are available through search? Memorization is not as vital a discipline as ful?lling curiosity with research and reasoning when students recognize
216
what they don’t know, form questions, seek answers, and learn how to judge them and their sources. Internet and Google literacy should be taught to help students vet facts and judge reliability. Is there a university, post-Google? Yes, these institutions are too big, rich, and valuable to fade away. But like every other institution in society, they should reshape themselves around new opportunities. Universities need to ask what value they add in educational transactions: qualifying teachers, helping students craft curricula, providing platforms for learning. We need to ask when and why it is necessary to be in the same room with fellow students and instructors. Classroom time is valuable but not always necessary. Many professional MBA programs have found ways to limit time together so that education need not interrupt life. The Berlin School of Creative Leadership (where I serve on the advisory board) has students meet in cities around the world so they can tap local expertise. Universities can become bigger than their campuses, and by bringing together special interests and needs from around the world, they can also become smaller, focusing on niches of knowledge while leaving other topics to other institutions. Schools, too, will do what they do best and link to the rest. That requires them to make their knowledge open and searchable; Google demands it. How will universities work as a business? To quote former MIT professor and satirical songwriter Tom Lehrer about the famous German rocket engineer who came to NASA: “ ‘Once the rockets are up, who cares where they come down / That’s not my department,’ says Wernher von Braun.” If I taught three, three-credit courses a term for two terms to 20 students in each and they paid what they pay to my state-supported university—about $250 per credit—that would bring in $90,000, which is what I am paid (I don’t do it for the money). In a competitive market, would students pay $750 for my class? That depends on the quality of my teaching, the reputation of the university, and the state of the competition. If they pay that amount, it still leaves no money for the university. Funds to support its structure would need to come, as they do now, from public or private subsidies. It doesn’t look like a sustainable model. Then again, look at University of Pheonix, Kaplan University, and other for-pro?t professional educational companies that have sprung up teaching students what they need to know for jobs. They’re not academic like Oxford, but they ?ll a role and work as businesses. They charge more
Jeff Jarvis
217
per credit-hour than my state institution but less than prestigious private universities. I think we’ll see many entrepreneurial enterprises devoted to education emerge as the internet enables a new marketplace of learning. Perhaps different entities will maintain different roles. To learn database programming, you go to Kaplan; to learn the entrepreneurship needed to create a new Google, you go to Stanford. On its official blog, Google gave advice to students, not about where they should learn but what they should learn. Jonathan Rosenberg, senior VP of product management, blogged that the company is looking for “non-routine problem-solving skills.” His example: The routine way to solve the problem of checking spelling would be use a dictionary. The non-routine way is to watch all the corrections people make as they re?ne their queries and use that to suggest new spellings for words that aren’t in any dictionary. Rosenberg said Google looks for people with ?ve skills: analytical reasoning (“we start with data; that means we can talk about what we know, instead of what we think we know”); communication skills; willingness to experiment; playing in a team; passion and leadership. “In the real world,” he said, “the tests are all open book, and your success is inexorably determined by the lessons you glean from the free market.” Rosenberg’s best advice for students and universities: “It’s easy to educate for the routine, and hard to educate for the novel.” Google sprung from seeing the novel. Is our educational system preparing students to work for or create Googles? I wonder.
The United States of Google: Geeks rule
What if a Google guy were president? Earlier, I told of witnessing the competing worldviews of Larry Page and Sergey Brin versus that of Al Gore as they tackled environmental and energy crises. Google’s founders saw the world and its problems through their engineers’ eyes. Rather than seeking solutions through regulation and prohibition they relied on invention and investment: shouldn’t do vs. can do. If the geeks take over— and they will—we could enter an era of scienti?c rationality in government. Other nonpoliticians have improved government. Michael Bloomberg ran New York City as a business. Arnold Schwarzenegger ruled California on the power of personality. A Google guy might just run government as a service to solve problems.
218
Whether or not they take charge, Google and the internet will have a profound impact on how government is run, on its relationship with us, and on our expectations of it. Now that we have the technological means to open up government and make every action transparent, we must insist on a new ethic of openness. So abolish the Freedom of Information Act and turn it inside out. Why should we have to ask for information from our government? The government should have to ask to keep it from us. Every action of government must be open, searchable, and linkable by default. The information government knows must be online with permanent addresses so we can link to it, discuss it, and download and analyze it. Government needs a new and transparent attitude: Officials and agencies should blog and engage in open conversations with constituents. They should webcast every meeting, since technology now makes that easy. Remember Weinberger’s Corollary to Jarvis’ First Law: There is an inverse relationship between control and trust. The more our leaders trust us with information, the more we will trust them with government. Right now, there’s too little trust in both directions. I want government to implement tools like MyStarbucksIdea and Dell IdeaStorm to enable citizens to make suggestions and share ideas, discussing them together as communities: GovernmentStorm. The United Kingdom has E-Petitions, a program launched by the prime minister’s office in 2006 with help from citizen activists in mySociety, which creates tools for government openness. Among the petitions: “Scrap the planned vehicle tracking and road pricing policy” got 1.8 million signatures. “Cut valueadded tax on 100% fruit juices and smoothies to the minimum 5% allowed by EU law to encourage shoppers to take the healthier option and achieve their ‘?ve a day’ ” attracted 10,400. “Make breastfeeding in public legally acceptable for all babies and children” got almost 6,000. In its ?rst year, 29,000 petitions were submitted (14,000 of them rejected because they were duplicates, jokes, or unlawful) drawing 5.8 million signatures. Here is a new way to involve the citizenry. We also need to use these tools to turn the conversation about government to the positive and constructive. We spend too much time complaining about government and trying to catch the bastards red-handed. There are lots of red-handed bastards to catch. But some people in government do care and work hard. Until we expect the best of them, we will see
Jeff Jarvis
219
only the worst. Let’s think like engineers and identify problems and work toward collaborative solutions. Pollyannaish? Yes, but if we never move past complaining we’ll never build anything new. I’m not suggesting government should be crowdsourced. I don’t want rule by the mob, even the smart mob. The internet requires ?lters, moderators, fact-checkers, and skeptics. So will the conversation that powers the country. That is the de?nition of a republic: representatives as ?lters. Those in power can use the internet to become better informed about our needs and desires and we can use it to speak and to contribute. The internet can transform the gift economy into the gift society. The internet—which is so often accused of creating echo chambers where we hear only like minds—enables us to organize in new ways, around issues and not just party banners. People of any party or state, red or blue, can gather around the environment, taxes, education, health care, or crime as issues they want to tackle. This requires a new personal political openness: We need to say where we stand to ?nd others who stand there. I’d like to see citizens use the web as personal political pages (PPPs) in which each of us may, if we choose, reveal our positions, opinions, and allegiances: the Facebook of democracy. I’d use a PPP to post my personal political statement online. In my case, I am a centrist Democrat; I voted for Hillary Clinton; I want to actively support movements to protect the First Amendment against Federal Communications Commission censorship; I believe we must support an aggressive national broadband policy; and I support universal health insurance. On my page, I would explain and discuss issues, linking to blog posts I’ve written or to others who speak effectively for my views. I already do this on the disclosures page of my blog because I try to practice transparency; my readers have a right to know where I stand on issues I write about so they can judge what I say accordingly. On my PPP I should also be able to manage my relationship with politicians—a variation on the theme of Doc Searls’ VRM or vendor relationship management. How about PRM: political relationship management? I want to say which candidates and organizations may approach me for my money or time. I’ll invite opponents to try to convince me to change my mind: Give me your best shot. If someone convinces me, I’ll change my public stance on the page. Personal political pages could
220
become a standard for disclosure and could be used to reveal in clear language the stands—as well as the con?icts and biases—of politicians and journalists. Let’s imagine millions of these pages that can be searched and analyzed to reveal a constant snapshot of the vox populi: Google as the polling place that never closes, except now we control the questions and our opinions, not pollsters. This new public square makes politics and public opinion a constant process instead of an annual or quadrennial event. It is a platform for organizing citizens. We can search Google for people who agree on a topic and try to gather them around a page, petition, group, politician, or organization. When I toyed with this notion on my blog, one commenter, TV-industry analyst Andrew Tyndall of the Tyndall Report, saw potential for reducing the power of the left-right pigeonholes in which we’re too often stuck. Those pigeonholes, he said, make it
so much more dif?cult to form coalitions with those at radically different parts of the ideological spectrum—with born-again Christians who are leading activists on HIV/AIDS or Darfur genocide; with Wall Street free traders who want to liberalize immigration with Mexico; with Cato Institute libertarians who want to legalize narcotics; with centrist Democrats like Jeff Jarvis who want universal healthcare; with neoconservative ideologues working to replace autocrats and theocrats with democrats in the Middle East; with non-partisan bureaucrats like Michael Bloomberg who want to switch transportation from cars to mass transit. Personal political pages allow each of us to escape from the conventional left-right authoritarian-libertarian divisions of the political parties and the opinion pollsters. They allow us to align ourselves on each issue discretely, forming ad hoc, opportunistic coalitions not binding ones.
The moment Facebook was translated into Spanish (with the help of its community), it was used to organize campaigns in Colombia against FARC (Revolutionary Armed Forces of Colombia) guerillas. Facebook was used to build a youth army for Barack Obama’s run for the White
Jeff Jarvis
221
House. Facebook’s Causes is used to help the public gather support for issues. The internet and Wikipedia are used to inform the electorate. Meetup is used to help organize voters. These are tools that can help us collaborate and manage our government. Google and company aren’t taking over Washington. They’re helping us take over.
Exceptions
PR and lawyers God and Apple
PR and lawyers: Hopeless
When I suggested on my blog that there were three industries immune from rehabilitation through Googlethink, my readers disagreed about one—insurance, which spawned an earlier chapter. But nobody disagreed about PR and law. I won’t turn this into a joke about ?acks and lawyers—there are plenty of those already (go to Google, search for “lawyer jokes,” and enjoy). Instead, I’ll use this opportunity to examine a few of the key tenets and prerequisites of Googli?cation through the exceptions that prove the rules. The problem for public relations people and lawyers is that they have clients. They must represent a position, right or wrong. As they are paid to do that, the motives behind anything they say are necessarily suspect. They cannot be transparent, for that might hurt their clients. They cannot be consistent, for they may represent a client with one stance today and the opposite tomorrow, and we’ll never know what they truly think. In a medium that treasures facts and data, they cannot always let facts win; they must spin facts to craft victory. They must negotiate to the death, which makes them bad at collaboration. It’s not their job to help anybody but their clients. They are middlemen. They won’t admit to making mistakes well; clients don’t pay for mistakes. Having said that these folks can’t be reformed according to Google’s ways is not to say that they can’t use the tools we’ve reviewed to their own bene?t. Some already do. Many lawyers blog (see a selection at Blawg. com). Like venture capitalists, they ?nd value in talking about their spe-
Jeff Jarvis
223
cialties, giving advice, attracting business, branding themselves, and sometimes lobbying for a point of view. Some can be counted on to cover legal stories with valuable experience, background, and perspective. Lawyers are a smart bunch who—surprise!—can write in English instead of legalese. Still, when a law blogger advises me to check my made-in-China tires for problems, I’m also aware that he’s on the prowl for class-action clients. Law is business. Some lawyers have taken advantage of online networking capabilities to create virtual law ?rms, eliminating the cost of offices and reducing the overhead of office staff. According to the blog Lawdragon, Virtual Law Partners uses these savings to give its partners 85 percent of billing revenue vs. the usual 30–40 percent. Virtual PR and consulting ?rms also operate loosely, bringing in members of their networks as needed for clients and communicating and collaborating without offices. PR people are trying to use the tools of web 2.0, Google, search, and social media to update their practices. Many of them blog—see, for example, Richard Edelman, head of the eponymous PR ?rm, and his web 2.0 guy, Steve Rubel, who blogs, Twitters, and joins in any new digital fad that comes round the corner so he can educate clients about them. PR people use these tools to keep track of what is being said about their clients and to join in those conversations. They have also been burned. In 2006, two bloggers wrote about their cross-country RV tour of Wal-Marts, where they met no end of allegedly happy employees. Revealed to have been arranged by Edelman and paid for by the front organization Working Families for Wal-Mart, the tour turned out to be an old-fashioned PR stunt updated only with the use of blogs. Edelman fell on his sword in a blog post: “I want to acknowledge our error in failing to be transparent about the identity of the two bloggers from the outset. This is 100% our responsibility and our error; not the client’s.” Case in point: PR people are not, and likely cannot be, transparent. They have clients. But it should be the job of PR advisers to convince clients that it is in their interest to be transparent and honest now that obfuscations and lies can be exposed so easily online. That is PR turned upside-down: Rather than representing and spinning the client to the world, they remind the client that the world is watching. They can also help companies ful?ll their new role in the ecology of information online. We expect companies to have sites, to share information, to be factual if not fully transparent.
224
Openness is the best PR you can have. Still, because they only advise, PR people aren’t often in a position to change how a company is managed. I’m sure lawyers and PR people—like real-estate agents—will be glad to tell me where I’m wrong and I welcome that discussion on my blog: Let’s have at it, and if there are ways to Googlify these trades, then congratulations. In the meantime, both ?elds need to watch out, for the tools of Google and the internet enable others to disintermediate, undercut, and expose them. The law and its execution are aided by obfuscation. The internet can ?x that. A small number of volunteers could, Wikipedia-like, publish simple, clear, and free explanations of laws and legal documents online. All it takes is one generous lawyer—not an oxymoron—to ruin the game for a thousand of them. I’ve seen a few such sites. They’re not very good yet—none worth recommending—but they’re a start. Another trend that helps both lawyers and clients is the movement to open up laws and case law online, making them searchable and free. It is a scandal that the work of our own legislatures and courts is often hidden behind private pay walls. Westlaw and Lexis, the so-called Wexis duopoly, have turned our laws into their $6.5 billion industry. They add value by organizing the information, but others are now undercutting them. Forbes told the story of Fastcase, a start-up that uses algorithms instead of editors to index cases so it can reduce costs and lower fees to lawyers. Better yet, g is ?ghting to get laws and regulations online for free. Patents are online now, and Google has made them searchable (go to google .com/patents and, for entertainment, look up pooper scooper—aka “Apparatus for the sanitary gathering and retention of animal waste for disposal” or “perpetual motion machine” or Google itself). Laws, regulations, and government documents are prime meat for Google’s disintermediation. Sometimes lawyers are employed merely to intimidate—but now the internet’s power to gather ?ash mobs enables those targeted by attorneys to return the intimidation. I’ve seen many cases of bloggers pleading openly for help against big organizations that are threatening or suing them. They received offers of pro bono representation from lawyers, often thanks to the Media Bloggers Association. The intimidators then received ?oods of bad PR. The internet doesn’t defang lawyers, but it can dull their teeth or bite them back. I would like to see an open marketplace of legal representation—present
Jeff Jarvis
225
your problem and take bids from lawyers who have handled similar cases, with data on their success rates. Legal representation can also be opensourced. People who’ve been in cases can offer free advice and aid to others: Here’s how I dealt with my landlord and here are all the documents I used; feel free to copy and adapt them. The goal is to free the law—our law—from the private stranglehold of the legal priesthood. Between putting laws and cases online and making them searchable, creating simpli?ed legal documents anyone can use, holding weapons to ?ght legal intimidation, and creating a more transparent marketplace, we would not replace the legal profession with all its faults but we could create checks on its power. Even the Supreme Court could bene?t from a little Googli?cation. After the Court’s esteemed justices made two mistakes in two decisions one day in 2008—one in a case involving the death penalty and child rape, the other involving energy regulation—they were corrected by bloggers who would have been happy to do so before the decisions, if only they’d been given the chance. I wouldn’t hold my breath. What other industries are immune from Googlethink? VC Fred Wilson said construction, because it’s so laden with atoms. Yes, but architecture is opening up—I’ve seen more than one effort to open-source both the creation and use of designs. We can also share ways to ?x up our homes. Waste disposal? Atoms again, but I’ll bet that we, the customers, will start using online soapboxes to gang up on manufacturers and force them to reduce their obscene packaging. Furniture? There’s a blog called Ikeahacker that enables fans to share ideas for modifying the slavishly standardized Swedish products. Mining? The book Wikinomics delights in telling the story of a mining company that opened up its geologic data to enable the public to help it ?nd deposits and to get a share of the wealth that resulted. Pornographers? Of course, they have been the pioneers in most every innovation in online media and the industry bene?ted from each move—until amateur porn came along on PornTube (the not-safefor-work YouTube) to undercut the business bene?ts of scarcity. The military? Actually, it was among the earliest users of blogs and wikis because it wants troops to share their experience and what they know. Terrorists? Unfortunately, they have made all-too-effective use of the internet and SEO to spread poison and create networks. No, few are immune from Google’s impact.
226
God and Apple: Beyond Google?
OK, then, what about God? Is he immune from Googlethink? Churches have used the internet to spread their word and create virtual congregations that meet online or through Meetup. There are religious versions of many of the internet’s big sites—such as GodTube, holier than YouTube—and religious groups have made clever use of others: God is big on MySpace and Facebook. Bible and Koran verses are searchable not only on the web but even on the iPhone. It’s hard to imagine God endorsing a wiki version of the Bible—but then, wasn’t the Talmud the world’s ?rst wiki? There are even web 2.0 religious movements. Open-Source Judaism—inspired by Douglas Rushkoff ’s 2003 book Nothing Sacred: The Truth About Judaism—has created the Open-Source Haggadah (a prayer book). God is not immune from the power and in?uence of Google. Is there any entity that is untouched? Is there an anti-Google, one institution that has become successful by violating the rules in this book? I could think of one: Apple. Consider: Apple ?outs Jarvis’ First Law. Hand over control to the customer? You must be joking. Steve Jobs controls all—and we want him to. It is thanks to his brilliant and single-minded vision and grumpy passion for perfection that his products work so well. Microsoft’s products, by contrast, operate as if they were designed by warring committees. Google’s products, though far more functional than Microsoft’s and built with considerable input from users, appear to have been designed by a computer (I await the aesthetic algorithm). Apple is the opposite of collaborative. It’s not that it doesn’t care what we think. After a product comes out, Apple has learned to ?x its mistakes—quietly. The ?rst iPhone’s headphone jack was recessed in the case to make it look prettier, but that also made it incompatible with all plugs but Apple’s own. In the next iPhone, the problem was ?xed. Make mistakes well? Apple makes them quietly. Apple has apologized—most recently for its botched MobileMe launch—but mea culpas are rare. Apple is a cult company and its customers are its best marketers—that much is Googley. Apple customers have made commercials for its products, they love them so. But Apple still spends a fortune in advertising, imbuing the brand with more cool because its commercials are as well-designed and well-executed as its products. Its most effective adver-
Jeff Jarvis
227
tisement of all is Jobs’ keynote lecture and demonstration at Apple conferences. The company could not be more one-way and less interactive. Apple is the farthest thing from transparent. It has sued bloggers for ferreting out and revealing its secrets. Attacking its own fans was unbloggy and uncool, but Apple didn’t care about the bad publicity. It’s Apple. Apple abhors openness. That’s another reason its products work so well, because it controls what can run on them, how it runs, and how it makes money. When the iPhone came out, there were many complaints from open-minded geeks about not being able to install their own programs. Then with the next iPhone, Apple created a closed app store with lots of choices. The complainers kept themselves busy trying out new toys, and many said it was a pleasure to see applications that had been screened for quality, unlike the software ?eamarket that Facebook and MySpace had become. Apple’s closed way of doing business is one of its advantages. While the rest of the online world was merrily destroying the music business with openness, Apple created the secure means for fans to buy billions of songs legally and happily. Apple does, however, support open-source software, bragging on its site that it contributes to dozens of pools of code. That is a good business decision. Apple based its operating system on Unix rather than trying to make one itself; it’s cleaner, far more reliable, and simpler than Windows. Apple’s not stupid. Apple does not think distributed. It makes us come to worship at its altar. Apple does not manage abundance. It creates scarcity. Witness the fanatics who camped out overnight to get each version of the iPhone. According to blog reports, the company cut off sales of the phones on the ?rst day with devices still in stock so there would be lines again the second day. Apple makes its own mobs. Atoms? Apple has no problem with them. iTunes drives customers to buy more Apple hardware. Free as a business model? The gift economy? Apple is not generous. It charges a premium for its quality. Apple follows just a few Google rules. Lord knows, it innovates. And nobody’s better at simplifying tasks and design. How does Apple do it? How does it get away with operating this way
228
even as every other company and industry is forced to rede?ne itself? It’s just that good. Its vision is that strong and its products even better. I left Apple once, in the 1990s, before Steve Jobs returned to the company, when I suffered through a string of bad laptops. But when I’d had it with Dell, I returned to Apple and now everyone in my family has a Mac (plus one new Dell); we have three iPhones; we have lots of iPods; I lobbied successfully to make Macs the standard in the journalism school where I teach. I’m a believer, a glassy-eyed cultist. But I didn’t write this book about Apple because I believe it is the grand exception. Frank Sinatra was allowed to violate every rule about phrasing because he was Sinatra. Apple can violate the rules of business in the next millennium because it is Apple (and more important, because Jobs is Jobs). So then Apple is the ultimate unGoogle. Right? Not so fast. When I put that notion to Rishad Tobaccowala, he disagreed and said that Apple and Google, at their cores, are quite alike. “They have a very good idea of what people want,” he said. Jobs’ “taste engine” makes sure of that. Both companies create platforms that others can build upon—whether they are start-ups making iPod cases and iPhone apps or entertainment companies ?nding new strategies and networks for distribution in iTunes. Apple, like Google, also knows how to attract, retain, and energize talent. “Apple people believe they are even better than Google people,” he said. “They’re cooler.” Apple’s products, like Google’s, are designed simply, but Tobaccowala said Apple does Google one better: “They de?ne beauty as sex,” he said. Apple understands the power of networks. Its successful products are all about connecting. Apple, like Google, keeps its focus unrelentingly on the user, the customer—us—and not on itself and its industry. And I’ll add that, of course, both companies make the best products. They are fanatical about quality. But Tobaccowala said that what makes these two companies most alike is that—like any great brand—they answer one strong desire: “People want to be like God.” Google search grants omniscience and Google Earth, with its heavenly perch, gives us God’s worldview. Apple packages the world inside objects of Zen beauty. Both, Tobaccowala said, “give me Godlike power.” WWGD? indeed.

返回书籍页