Explosion
Tales of Two Worlds · What does a decentralized world look like? (part 3)
This is part 3 of Tales of Two Worlds. Here is part 1, part 2.
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Tales of Two Worlds
Stories of Two Worlds — through the lens of the Centralized vs. Decentralized dualism:
Centralized vs Decentralized
- Society vs. Network
- People vs. Sentient & Autonomous Agents
- Social Activity vs. Network Effect
- Clustering increases efficiency & potency vs. Clustering decreases efficiency & potency
- Organizations trump people vs. Agents trump clusters
Third story: “Look What You Made Me Do”
Social Activity vs. Network Effect
We humans are social animals. Yet we are fundamentally different from other social animals (such as bees, ants, or penguins) because we carry out special social activities among us. We can tell stories. Our stories get passed from one individual to another, one generation to another, and on and on. These stories connect us and bind us together as an organic whole — our society. This is how we built our civilization: by harnessing memory from stories. If we consider how stories propagate through space and time in our civilization we could observe that the information flow in our social activities is quite uneven and imbalanced; such imbalance is caused by the fast decay of the natural information flow in our social activities — information does not go very far and we humans forget easily. This imbalance of information flow manifested very noticeably in the 20th century: the rise of the modern media and the power it wields. It also reflects the nature of our current society and civilization — that it is centralized.
Until we have the Net (cyberspace and later the Internet); then everything changed. The Net remembers everything and forgets n0thing. By giving everyone a true, uncensorable voice, the Net can restore the balance of the information flow, isn’t that what we wanted in the beginning (of history)? One caveat though: the Net has to be decentralized. We’ll come back to that.
In the early days of the Net, people don’t quite understand how cyberspace, or virtual worlds, work; it feels like walking with barefoot; so people desperately tried to put whatever shoes available on their feet to sooth the discomfort. One of such shoe is called network effect. Network effect as a social-economic theory/narrative had been around long before the advent of the Net; it appeared to explain the external social-economic “value” of telephony, where each user gets an added intangible value (“usefulness”) with more users joining the telephony network. Network effect seems to be a perfect fit for explaining various Net phenomena, like the proliferation of successful Internet services, up to the rise of the social networks.
But have we really gained any net positive insight of cyberspace, Internet, virtual world, or even decentralized world from the traditional network effect narrative? I’d say “unfortunately, not so much”. Nowadays we are so bombarded by talks of network effect, most people just feel tone deaf and dismiss them as shallow marketing sweet talks — “grow your online business using network effect!” — yeah right.
Now let’s pause and rewind to the beginning of cyberspace and rethink. Network effect is important and is indeed a powerful idea. It just needs an upgrade.
When we go back to the beginning of the Net, we would see that it is a very communal place — this is in striking contrast with the telephony network, which is a strictly non-communal place, even with those so called party-line services. When people use the telephony service, they do not gain or get access to new kind of communities, such as online communities; they at most participate in ordinary social activities. A big reason for this distinction is that nodes of a telephony network are telephones not computers; these nodes (telephones) do not have the capacity to store any memory; and a community must have memory. Therefore telephony networks are not themselves unique separate online communities.
You see, online communities, or virtual worlds, are a truly new breed of community, one that with hyper-dimensionality. They are hyper-dimensional because people can join multiple or many more online communities in an extra dimensional sense, in split or multiplicious space and time, often even with split or multiplicious identities and personalities. As we have discussed in our previous story, in virtual worlds humans/people can be regarded as not having free will, which is the reason why you can have all that split and multiplicious identities and personalities, in the first place.
What does this have to do with network effects? Almost everything. The hyper-dimensional, multiplicious minds of the virtual worlds just make network effects there also hyper-dimensional.
To grasp the full meaning of this profound revelation, the hyper-dimensional network effect, we have to go deeper into both the physical world and the virtual world and start digging…
In the physical world, the naive narrative of network effect, is one-dimensional. We even have a law for it, substantiating a quantitative relationship between the size of a network and its purported value. Since that value is a scalar, the narrative of such network effect can be seen as one-dimensional. However, the meaning of the value, embodied in the construct of connections between network nodes, is quite vague and elusive. Traditional economists only see that value as a kind of economic externality, sometimes with an indirect price-tag attached to it. Many took advantage of that price-tag associated one-dimensional value of network effects, and help turn the Internet from a free-spirited communal sanctuary, into a very centralize commercial marketplace. It’s regretful that the internet took this unfortunate evolutionary path, yet hope still exists.
It turns out that exploring the hidden structure of a hyper-dimensional value construct of the network effect phenomenon, might shed some light on how to restore the internet to its original vision, as well as help build a new decentralized world. Now we know where to look beyond the one-dimensional network effect, a vibrant hidden world of hyper-dimensional value construct emerges.
Let’s examine a typical social network phenomenon, virality. Virality in an online virtual world is like an explosion — the rate of attention spreading increases as it propagates further into the network. Some don’t even recognize virality as a kind of network effect because it is indirect or secondary compared to the canonical network effect narrative. You can view the spreading virality as building a secondary network within a primary network — I think this is a much flexible and general network effect framework than the traditionally economics centered two-sided network effect narrative. The “two-sides” refer to the supply-side and the demand-side. That is a very rigid and narrow view, completely dependent and built upon a traditionally one-dimensional economic value concept. As stated, this value view is too limited. Let’s propose a new value view, a hyper-dimensional one.
So virality is a kind of explosion. But explosion of what? A explosion of attention spreading, that is. Attention spreading is just the collective effect of minds talking to and interacting with one another in a very noisy way. This brings us back to our aforementioned profound revelation — that it is the noisy, multiplicious minds that give us the hyper-dimensionality for this new network effect narrative. Now we can propose an associated value concept: that this new value is the mind’s communal energy that drives the spreading, or propagation of attention. This new value concept will manifest its potency through the prism of the centralized vs. decentralized dualism:
This new value view has fundamentally broken off with our current value view of a centralized world regime; since the core social-economic narrative of that centralized world regime is its value narrative, i.e., how we see the world we live in — this new value view is also a brand new world view, for a new world, the decentralized world. Let’s examine both value views.
So what is our current value view, or world view, for our centralized world?
A resource-bound one. Or rather the fight or control over resources, in a Malthusianism and Social Darwinism sense, measured, indoctrinated through and bolstered by an elaborate pulleys and levers system we call the modern monetary theories and policies, as well as institutions and their subsidiary, the financial industry. Yes, you might have already guessed it: this world view is the money view; or a variant of it, a profit view. Wait a second, you say — Malthusianism or Social Darwinism sound bad, and haven’t we fought two world wars to break away from them? Haven’t we also fought and won a cold war to finally secure the world from falling into a false path? Haven’t we made the world a better place, with the creation of the ultimate Eden of freedom, the internet? Well I am not so sure. When “freedom” is secured by the most powerful institutions in world history, the monetary and financial institutions (MFI) — that might just make you wonder, what is freedom? Could it be an illusion pulled in front of your mind’s eye to blind you from the truth — that you are living in a terrible despotism called CTIR (Centralized Technological Industrial Regime), with MFI as its supreme Praetorian Guard?
Great. I want to unplug. Give me the Red Pill. What about that alternative value view proposition of the decentralized world that is based communal energy of the minds?
Show me.
It’s better explained by a case study. Let’s go back to our virality story. In late August 2017, Taylor Swift, an American pop singer, released a music video called “Look What You Make Me Do” on Youtube, the №1 video sharing website in the world, and smashed a viral record on the website for that time, the most views during the music video’s first 24 hours of release (the previous record of the time, was 3 years prior, by Korean pop star Psy’s “Gentleman”). As we discussed earlier, this viral event does not conform to a traditional two-sided network effect narrative, the traditional economic model doesn’t really care about virality of the event, only the size of it — which is quite telling of what a centralized value view is really about: the part where it can bind a resource to extract a price, a revenue, a profit (or just money, for that matter). Caring about virality or not, the business (and revenue) model of the modern web has already found a perfect joint to extract that value, like tapping a maple tree: the eyeball. Every ad you have to watch before or during your youtube video play, every banner you have to glance on your website, those are the spiles for the tapping. What about the sense of community? And the interaction and exchange of thoughts between all those online minds? Well, obviously that is not what the system that installs the tapping spiles cares about, you are just maple trees to them; all that matters is the maple sap they could tap, that is the centralized value: a resource-bound economics notion rooted in a centralized world.
In the early days of the Internet, the “pure communal era”, mainstream business world couldn’t figure out a “business model” for the Net, meaning that they didn’t find the maple sap and where to tap them. Therefore for them (mainstream business world) the net value of those online activities is zero, nil, nada. If we apply our new value view based on communal energy of the interacting minds to measure these online activities, the value is abundant, and vibrant. We say vibrant because our new value is hyper-dimensional, not like the resource-bound centralized value, which is one-dimensional — a number in a cell of some balance sheet.
As the Internet entered into the web era, mainstream business world finally discovered the maple sap of the internet and where to tap them. I weep for the day (around 2003) Google built the first effective capillary-pipetting Ad distribution system for the web. That is the day Sir Tim Berners-Lee’s web, and also the early Net, got the first cut in a long, excruciating execution — Lingchi style (death by a thousand cuts); it also opened the floodgates for a continued vampiric horde to do the same — raid, pillage, maim and kill the web with more sucking cuts till this day. Many had mistaken network effect as web’s business model — it is definitely not the case. The traditional network effect business model prescribes a system where reciprocal value exchanges take place between network operator and users, both internal and external. The parasitic capillary-pipetting Ad business model of the modern web does not do traditional value exchange at all: it is a spider’s hunting ground (or web) — the free stuff users of those websites get is just a dose of prey venom before the sucking. As these web properties are never really stakeholders of the organic web communities, the business model of the modern web is really a predacious or parasitic one and we are merely the prey caught by the web spun by these spiders.
Value view is vital, without it you can’t even start thinking in economics, let alone applying one; the old economics won’t even make sense for a new value view. To really understand the nuances of this point, let’s push our case study a little further.
So virality on the modern web is like an explosion. Just not any explosion though — it is word of mouth at the speed of light — just like a chain reaction. How to model a chain reaction explosion? Here is the kicker: it depends on your value view. Alright then — let’s model the virality explosion on two opposing value views: the centralized, resource-bound one and a decentralized, mind’s communal energy one:
Virality explosion model
under a centralized, resource-bound value view
In this value view, the goal is to extract value from the virality propagation process outwardly, and the value extracted would be external to the actors (propagators) of the virality propagation — they don’t get this extracted value (Google or Facebook won’t share their ad revenue or profit with your the user). With this stipulation, I think we can model the virality explosion on the modern web like a nuclear reactor. If we choose a simplistic modern nuclear reactor, BWR (boiling water reactor), then the native energy of the nuclear chain reaction is partly captured by liquid boiling water, acted both as a coolant and neutron moderator. The boiling water generates steam, which then turns a turbine to generate power. We can map our ad network to the liquid boiling water in our reactor, and the steam is that extracted value. Like the turbine propelled by steam, an external control party supposedly receives the extracted value. In this model value itself and its purpose are both external to the virality process itself. Actors here are those splitting atoms of the nuclear chain reaction, but they (actors, we users, us) are too far removed from the value of the model system. That is the problem — in this model we web users are just fuel to be spent and deep-sixed. We’re simply waste in this value view.
Virality explosion model
under a decentralized, mind’s communal energy value view
In this value view, there is no external extraction of value. Value stays inside the system. Value will be incentivized to take many shapes and forms to aid the evolution of mind’s development of complexity and diversity. We can model this kind of virality explosion as a rainforest — the explosion of biodiversity. Like in a rainforest, nothing gets wasted; life’s myriad forms attest its extraordinary ability to conserve and utilize the last drop of precious energy. Mapped into our model the biodiversities are the vibrant online communities driven by vibrant activities and interactions among individual members. So what is driving all those vibrant activities? The minds’ natural desire to interact with other minds — we can model this drive as a brand new kind of economic energy; it only effectuates on a microscopic level though; that’s also why it’s a perfect fit for a decentralized world — when you send that text to your heart’s crush; when you ask a question to a friendly stranger seeking help; when you send your bitcoin to your local barista for a cup of cappuccino — those are the microscopic energy we can tap into to build a brand new economic value system for a new decentralized world. If a rainforest can survive and flourish on the collective of billions of life forms’ humble yet unbending drive to survive, thrive and evolve — I believe a new decentralized world will have a shot to be in our future.
Now you’ve taken the Red Pill. Before you roll, let me tell you that our situation is dire.
Since we know that the traditional centralized resource-bound value economics sees and detects no value in these communal online activities, these independent online communities have never gotten any support of an economic system to aid their development and evolution. Now with the modern web choked by those predacious and parasitic web monopolies, these organic communities are suppressed and renegaded to the fringes, their survival increasingly threatened by the exterminating powers of the centralized web and its army of sicarios, Big Data. But life always finds a way, especially under extreme harsh survival conditions. The last decade we’ve seen a revival of those independent communal online networks, the most prominent is the cryptocurrency movement and its flourishing communities. The Genie is out of the bottle now — a decentralized world is unstoppable.
Even the smallest person can change the course of the future. It’s time we take down empires.
