I am challenged by questions concerning the structure of #VRM tools that are built for “Me” in a personal data context, versus the structure of #VRM tools that are built for “Us” in a market context.
There are several questions which I’ll respond to in context below.
If I am able to build #VRM capabilities for Me, but do not offer them as a service for others, are they any less #VRM?
No. The architecture is about empowering the individual participant in a multi-party encounter. Your interests in that transaction are represented by VRM independent of who the other participants are, including if one of them is you. If you express a preference for non-DRM content and then publish a book in both PDF and e-book formats, your VRM-enabled app will steer you toward the PDF version when you go to download a copy when the book goes live. That should occur whether you download it from Amazon or moxytongue.com, right?
Is #VRM about the provisioning of “services” to a market (Us)…? Or, is VRM about the use of tools that give capability to Individuals (Me)…?
I realize that one plausible answer could be “both”…
Settle for “neither”? Once upon a time, every product was bespoke. Buyer and seller approached on equal terms. Mass production improved quality, reliability, cost, but removed customization and elevated the seller above the buyer so that conversations had more friction in one direction than another. Mass media changed the relationship again, further elevating the seller, increasing the friction in uphill communication to the point that is almost disappeared. Accommodation of individual tastes and requirements eventually became recognized by sellers and delivered as variety in fixed models, then limited personalization as part of the product.
Services eventually adopted the same sorts of adhesive contracts and one-way relationships as hard goods. So even though these relationships are more naturally framed as conversations than those with mass merchandise vendors, simple inertia drags them along. It is inefficient to maintain multiple types of relationship when the legal and social framework is itself a product of mass production and not easily customizable. If you start a service business, do you pay a lawyer to draw up custom contracts from scratch? Or do you ask that person whether they’ve done this before and have a template? If you trace the lineage of those templates, they probably inherit a lot from those of hard goods, I’m guessing because case law and large money decisions predominate there.
VRM is about restoring the relationship between providers and their customers. It certainly isn’t about services and to consider it merely as empowering the individual is incomplete. The goal is to restore parity in the relationship. Individual empowerment is perhaps the most visible outcome of VRM but it is only one of the many desired outcomes. It makes a good rallying point for VRM among dissatisfied consumers so it also gets the most air time.
If you accept the premise of VRM as a means to restore parity, then what are some of those additional desired outcomes other than individual empowerment?
Improvement of the signal-to-noise ratio. In a mass market or mass media relationship, upstream input is necessarily noisy. Either you listen to everyone or you listen to consultants and pollsters who take samples and extrapolate. When you do listen, the information is proprietary and not shared with competitors in the market. Although this may help you, it’s extremely inefficient for the market as a whole.
The entire model is based on atoms. It simply wasn’t possible to listen to every customer in the past. Laws of physics and relativity made it impossible. But with bits, it is possible. VRM wants to provide clean, direct buyer feedback, from every willing buyer, in a format that is machine-parseable, and at a cost-benefit price point that is better than what is possible in the atoms model.
Checks and balances of power. There must be checks and balances in the relative power in a relationship to maintain homeostasis. Lacking those, a positive feedback loop can be triggered if the balance tips too far, causing the balance to swing to one extreme or another. Stability becomes very precarious without these natural controls. If you are on the receiving side of the positive feedback loop, triggering one generates enormous windfalls of wealth and power. Once this is achieved, restoring balance becomes extremely difficult.
We are seeing in every aspect of society the effects of removing checks and balances. In the world of atoms, spectrum was naturally scarce, radio and TV bandwidth was expensive and advertising revenue steered content toward the mainstream. The shift to bits allowed niche content to thrive. The appearance of extreme viewpoints on cable and radio legitimized them and they became the new normal. Recognizing the residual profit in niche markets, and without entirely abandoning mainstream, revenue shifted to extreme programming. This triggered a positive feedback loop in which successively extreme positions became the new normal until eventually pure fiction passes for credible news and there is nobody left with whom you can have a reasoned debate.
You can see these power grabs everywhere, many caused when the move from atoms to bits removed physical limits to some constraint. Many are second-tier effects caused by recipients of these new powers wielding them in other contexts. Things that have fallen out of homeostasis include:
- Copyright extensions and enforcement regimes are spreading aggressively through accumulation of power and positive feedback loops.
- Patents. Nuff said.
- Banking and securities. Note who it is saying that less regulation is better. Generally those on the windfall side of the runaway feedback loop.
- Oil and energy. Even if gas and bio fuels were viable, the greenhouse gasses will kill us. The ONLY solutions long term are those that capture tidal or incident solar energy or their derivatives.
- Religion. I don’t care what any religion says when it comes to government, the US was specifically founded as a polytheistic country on the premise that this was the only way to insure religious freedom. Things like DOMA have no business in government. Either government encourages long-term, stable, family relationships with tax and other breaks or it doesn’t. That’s universal. Only religion tries to bring gender into it, and that falls apart quickly with hermaphrodism and other biological gender indistinctions. Therefore gender is not a universal case that can be distinguished or enforced fairly and not appropriate for legislation. And when did offending someone become a capital offense or the basis for enacting laws?
- Law. Current legal frameworks are the result of 200 years of Chinese Whispers, a.k.a. The Telephone Game. How else is it possible for the IRS to seize all your accounts and property without notice without running afoul of the constitution? Ever notice that Miranda Warning below your signature on the tax form? Tell me again how I can’t be forced to testify against myself. Recipients of power from these feedback loops immediately try to preserve them by enact the new powers into law. Over time we end up with laws that are upheld on appeal yet don’t reconcile back to the constitution.
I could go on but you get the idea. Technology on the vendor’s side has moved from atoms to bits, thus minting expansive new powers for vendors. This destabilizes the relationship. You can already see the effects in your email in-box and, if you run something like Ghostery, as trackers in your browser. Note that industry is attempting to preserve this power by influencing standards, policy and law to enforce a default assumption that the consumer has opted-in to all such tracking and advertising and must take affirmative action to opt out.
By restoring checks and balances in the relationship, VRM can stabilize it and prevent further runaway feedback loops. As you look around at VRM proponents and opponents, note which ones stand to gain from a windfall and, of that group, which are acting against interest to stabilize the relationship versus those who would let it tip.
There are many other benefits of VRM that are neither services nor tools, most of which deal with possibilities emerging from networked relationships. Up to now only the supply-side has been networked and empowered. It should be intuitively obvious that providing similar capability on the demand side has the potential to transform commerce on at least the same scale as it did on the supply side. Maybe this is fodder for another post.
but there is a fundamental shift in the model that creates value at a scale /1… versus those that create value by aggregating activity in order to deliver service value at a scale of n – % /x.
No, that’s an artifact of the massive disparity in the many-to-one relationship. The vendor creates new value because it is able to aggregate on a massive scale and because uniformity of the product and the relationship allows the costs to be spread.
VRM creates value for the consumer by reducing the cost of information to be on par with the vendors and by making upstream feedback consumable by vendors. As noted in the previous bullet, VRM also provides value by stabilizing the relationship so that the consumer’s interests are better represented and preserved over time.
It’s worth noting that positive feedback loops do not always result in the needle staying pegged at the one extreme. A stable signal can devolve into a flip/flop, alternating between extremes. You are witnessing the US political system entering into this relationship now and while each party celebrates its wins, the instability hurts us all more than cooperation and compromise would. Statesmen know this. Politicians don’t. If commerce also enters into this flip/flop relationship it won’t be good for anyone involved. Keeping us stable is one helluva added value VRM brings to the table.
Individuals use tools, and the use delivers a return of value that is /1. This is a fundamentally different model.
One word: Synergy. When I write this, the tool I use gives me /1 return on my time and effort. There’s an opportunity cost in not doing one of 100 other possible activities. But the ideas that flow forth and influence others multiply that /1 into N x 1 quickly. I could shout the same ideas in the town square but the effects of dense network connectivity among my online community, and their 2nd and 3rd tier connectivity, massively multiplys the impact of one good post.
VRM doesn’t just deliver /1 return on your investment. It aggregates and delivers a portion of the /1 from all the other users. And because it’s bits and not atoms, it can replicate this benefit at near zero incremental cost indefinitely, even retroactively, and over a broad population.
The first person with a FAX machine was the proud owner of a very expensive brick. The value of the FAX machine is only realized in the availability of a large, densely connected network of them.
The first person with a VRM app will be the proud owner of some very expensive bits. The value of VRM is only realized as a participant in a large network of connected nodes with sufficient density and signal (both quantity and quality) to act as a stabilizing force in the relationship and level the communication path so that it is no longer upstream/downstream but pub/sub and peer-to-peer.
Revenue silos are the ultimate context controllers in current market designs. Sovereign Individuals will not empower silos as they exist today… and the future [neo/s] is only going to be built successfully with this in mind.
Probably true but now you are forecasting the other side of the singularity. We can anticipate things that are incrementally improved from what we have today but are unprepared to predict the possibilities that emerge from there and the ones built on that. But given the rate of technology there’s a good chance we’ll live to find out.
I’m not completely abandoning the question but as a futurist, I have a much clearer idea of emergent models arising from devices than I do of those arising from social and commercial systems. Given my Asperger’s traits, that’s really no surprise, though.