Rebooting the Internet: Andreessen Horowitz’s Chris Dixon on the Decentralized Web

Chris Dixon and Dominic Williams discuss how the Internet Computer blockchain will create new engines of innovation.

In recent decades, corporations have taken over the internet with proprietary networks that provide access in exchange for the loss of privacy and ownership. The result has been an extractive data economy that primarily serves a handful of tech giants to the detriment of competition and innovation — and which is ripe for an intervention.

What might it mean to reboot the internet and make it open again? The Internet Computer is the world’s first web-speed, internet-scale public blockchain, enabling smart contracts to securely serve interactive web content directly into the browsers of end users. An open playing field for developers and entrepreneurs is within reach with the potential to catalyze the next stage of growth on the web.

At DFINITY’s recent launch event for the Internet Computer’s Tungsten release, DFINITY founder and chief scientist Dominic Williams was joined in conversation on these themes by Chris Dixon, general partner at Andreessen Horowitz.

Platform risk and the Web3 era

“Once tech companies reach a certain size,” noted Williams, “there’s a tendency for them to stop innovating and restrict access to user data and relationships that they shared during their explosive growth phase, and then squeeze everyone in the mode of a monopoly. And this can be really harmful for the ecosystem.”

Open protocol web architecture was one of the reasons that the United States became a leader in technological innovation. Entrepreneurs were willing to build because they knew that if they built something, they got to keep it. Decades of investment went into new ideas before platform risk became an existential threat to startups. But the landscape has changed, as tech giants with some of the highest market capitalizations in the world leverage their dominance over smaller players.

“Platform risk is this concept that, if you’re an entrepreneur or an investor in startups, there is a huge existential risk that looms over all software development, essentially, is that at some point if you’re successful, the big guy that you’re dependent on will come and extract rents,” remarked Dixon. “And in some cases much worse.”

“Like in the case of Zynga,” he went on, “Facebook just changed all the rules. It just destroyed the economics. Twitter changed their API that just literally killed off overnight a huge swath of startups, like Twitter clients and things that depend on the API.”

Dixon compared the situation to the inherent instability of building under the threat of asset seizures in an authoritarian country, where there is generally far less investment than you’d see in an open democratic society.

“My view is it really stifles innovation,” he said. “It stifles startups.”

Functionality + openness

It’s true that large applications have conferred great benefits. Big data and high-market-cap tech companies offer services that allow users do things more quickly and conveniently — but they also hijack and leverage user data and relationships to maintain the advantage of immense network effects. Society has grown increasingly aware of the costs and problems associated with the corporatization of the internet.

“One of the really exciting things with blockchains is that we’re now entering the Web3 era, where we think you can get the best of the combination of the advanced functionality of Web 2.0 — all the richness and reasons why people love Twitter and Facebook and Gmail and all these other modern applications — but the openness of Web 1.0, the lack of platform risk,” said Dixon. “Startups can really build on things.”

“That’s the kind of thing you’re building,” he remarked to Williams. “DFINITY is that kind of infrastructure where you can build that advanced functionality and not make trade-offs.”

The original open internet provided a global public network where anyone could connect and provide services without the fear of losing access. Rebooting the internet to renew this openness involves extending this public principle to cloud computing and software — which is precisely what the Internet Computer aims to do.

“You can actually store data within the protocol, within the internet,” explained Williams. “You don’t need to put it on a proprietary platform like AWS or necessarily within a social network — say, like Facebook. Somebody can build an open internet service into which users can put their data, and upon which other companies or enterprises or open internet services can build because they’re guaranteed access through the APIs that are provided.”

Read more: The Internet Computer Welcomes Third-Party Developers to Tungsten

He described the Internet Computer as a seamless universe for software where you write and deploy code without needing a database or a file system to process anything. The software effectively runs across a distributed network of data centers rather than from a single server.

“Software is more malleable and a much richer design space” than hardware, said Dixon. “There’s more room for entrepreneurship and creativity and big shifts in paradigms.”

On governance

Governance is one such shift. The Internet Computer, for example, is distinguished by a consensus protocol that protects the platform’s users from the malicious behavior of rogue participants. Open internet services and autonomous software can also have tokenized governance systems that effectively self-regulate questions around APIs and data. This principle can also extend to other models within the network.

Dixon suggested that people are unhappy about social networks and gig-economy marketplaces because they felt that they had helped build these services as users and were then shortchanged.

But in participation-based marketplaces, permanent commitments are written into the DNA of the business. What if instead of funneling capital straight into customer acquisition costs on expensive channels like Facebook, young startups had the option of inviting early customers to be partial owners with skin in the game?

“Think about how it works in Silicon Valley,” explained Dixon. “Everyone knows somebody who worked at a successful startup and made a lot of money. What if it was the same thing with internet networks, where everyone knew somebody who was early on a network and made a lot of money and it became a thing? You’d want to participate in early networks and take that risk. It just would take this interesting dynamic that happens with startups and expand it to a much broader group of people.”

Governance and community ownership are blockchain advantages, he noted. “I think of it as a set of commitments to developers, which enables innovation, and then a set of commitments to users, which enables good behavior.”

Catching the wave

Dixon likens the state of decentralization to the evolution of Web 2.0, comparing this moment to when the world was on the cusp of the ascendance of mobile tech.

“DFINITY is trying to be the iPhone. We are pre-iPhone in the blockchain space right now,” he remarked.

“When you look back on every decade in tech, there’s one thing that really dominated. And I think this will be the one in this next decade,” he added. “If you’re somebody who’s thinking about where to start a company, I think you should really take a hard look at this space. Because we’re not only changing the platform on what you build, but we’re changing what you can build. It’s a new kind of platform.”

Read more: How Software Developers Build Better on the Internet Computer

The effort to reboot the internet begins with cultivating the decentralized web ecosystem.

“Blockchains and all of this rich internet infrastructure is the most important thing happening in it, and I think it will take many decades to play out,” said Dixon.

“If you’re an entrepreneur, you can have interesting products that reach scale and have good financial outcomes and societal outcomes — over the next five to 10 years, or more in the near term, but I think it’ll also play out longer. Similar to the web,” he added.

“It’s a huge, huge, huge space.”

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