Connectivity, first principles

I have just discovered the writings of Bob Frankston at  frankston.com  and much earlier circa 2002 at satn.org. Bob writes about issues of the internet in language that I can understand, at least partially.

Take the issue of connectivity. In 2002 he wrote about what it is and why it is important. He breaks it down into simple concepts because it is a simple concept, according to him. 

If we are to imagine what we want from the internet, isn't it necessary to comprehend what it is and how it is built? Important distinctions between concepts like connectivity and content should be apparent just from the language. But they are not. As least not in the confusion of the internet where the value of content dropped to zero while the value of connectivity rose.

In my lifetime the first experience of connectivity was the phone call that connected one speaker-person with another. The second was the radio and then TV which connected a broadcaster with the masses. The connection is made through a channel creating connectivity.  

Each new communication technology brought about disruptive forces requiring us to adapt. The financing of programming on radio and TV by advertising, for example, changed the way that business communicated with us. We paid for TV content with attention to ads rather than with currency.

When the internet came along we experienced connectivity as email and the Web, but this technology can also carry radio, TV, phones and things that we have yet to imagine. Bob Frankston says this creates a problem of culture shock since the technical infrastructure of phone, radio and TV businesses have a legacy.  In particular the regulatory framework that is in place for these businesses is unsuited for the issues of the internet. What was separate businesses in separate channels gets lumped together in a single channel, which in turn lumps together the business of connectivity with the businesses of delivering content and services. This is referred to as "convergence."

Apparently now we have a disruption of an effective marketplace because of a confusion between business and the marketplace. If connectivity is a utility like water or electricity, in principle it is different from business and services because it carries them. Maybe they should not be lumped together, maybe we should go back to first principles. But the idea of going back to first principles is unconceivable in our complex world. It would require an unrealistic political reengineering.

The incumbents have been advantaged. However Bob says "By maintaining two very different kinds of businesses within a single corporation the shareholders are denied the ability to maximize the value of the shares by making an informed choice. Instead the profits are used for cross-subsidies and, as we have seen, for the operators own naive investments in the dotComs." The owners were unable to deal realistically with their own new technologies.

In conclusion Bob Frankston says "We need to remember that there is a big difference between being pro-business and being pro-marketplace. Capitalism is all about marketplaces. Capitalism fails if we try to preserve a given business model. In telecommunications if we simply preserve a business then we have failed."