IP: LAST COLUMN! NYT Digital Commerce: Is That All There Is?

[David Farber <farber () cis upenn edu>]

> X-Sender: caruso13 () mail earthlink net
> Date: Fri, 31 Mar 2000 06:02:51 -0800
> To: farber () dsl cis upenn edu
> From: Denise Caruso <denise () caruso com>
> Subject: LAST COLUMN!  NYT Digital Commerce:  Is That All There Is?
>
> good morning!
>
> this is my last 'digital commerce' column for nyt.  i've started a
> nonprofit foundation in support of the research community called 'the
> hybrid vigor institute," and i'll be devoting most of my time to it.
>
> i'll still be writing for the times -- most frequently for saturday's
> fantastic 'arts & ideas' section -- but for the moment, at least, i am
> turning my daily focus away from the internet economy.
>
> this is something of an auspicious moment for me, after all these years
> writing about the inner workings of the technology industry.  for the past
> few months, as i've been contemplating these changes, i've been thinking
> about how i wanted to mark the event and give something back to the
> community.
>
> so i decided to archive 17-plus years of writing and speechifying and put
> it on the web, which i did with the help of a couple of great web designers
> in san francisco (nathan shedroff and mark meadows).  et voila:
>
> http://www.caruso.com
>
> i hope it will be a useful resource, especially for people who may not be
> aware that some of the big issues -- both technological and social -- have
> been thought about and discussed for a long time.
>
> we got the site up and running in less than a week, basically.  so i hope
> it doesn't break and if it does, 'pardon our dust,' as they say in the
> construction biz.
>
> the beta 'hybrid vigor' website is linked to caruso.com as well -- it's
> still on a staging server, so don't bookmark the url.  but DO send me email
> and tell me what you think -- and tell me you want to get involved, or know
> someone who's perfect, etc.
>
> thank you for your support of my work; i hope you'll stick around for the
> next installment.  leaving the column was an incredibly difficult decision,
> but i think the timing is right.
>
>
> best,
> denise
>
>
>
>
> March 27, 2000
>
> DIGITAL COMMERCE
>
> Technology Has Made Some People Money, but Is That All There Is?
>
> By DENISE CARUSO
>
> I once heard the technology pundit and historian Paul Saffo say, "Never
> mistake a clear view for a short distance" -- a witty caveat that surely
> must be the understatement of the digital age.
>
> It was a truth that struck close to the bone while I was preparing to write
> this, my last Digital Commerce column. (I'm starting a nonprofit research
> venture.)
>
> While browsing through my archives, more than 15 years' worth of articles
> and speeches and commentary for various publications and venues, I recalled
> the days when telling people that you wrote about technology was like
> dropping a stink bomb at a political rally. You could clear the place in 10
> seconds flat.
>
> Then I came across the first piece I wrote that detailed the enormous
> challenge facing copyright law as digital media gained commercial
> ascendancy. The year was 1990. But only now is the battle fully engaged
> between copyright holders and citizens who demand their legal right to
> copy. The pieces I wrote describing the challenges of online privacy and
> censorship were even longer ago, in 1988.
>
> Never mistake a clear view for a short distance, indeed.
>
> Yet for all of technology's new exposure and celebrity, many executives and
> other industry experts are increasingly and deeply troubled by the turn the
> Internet industry, in particular, has taken.
>
> Technology and business strategists like John Doerr, the venture
> capitalist, who by this point has nearly the name-brand recognition of
> Coke, once saw in digital technology -- and particularly the Internet -- a
> universe of bankable ideas. It was a fertile breeding ground that could
> both change the world and make a ton of money.
>
> The result, as we have heard Doerr say so many times the last five years,
> has been the greatest legal creation of wealth in history.
>
> But in the past, investors knew that a company's successful public stock
> offering only signaled a promising start, not the final bell. A company
> that lasted was the real proof of their vision.
>
> Today, the only vision required to make zillions of dollars in the Internet
> economy is nearsightedness. The stock market remains so irrationally
> exuberant that almost every me-too dot-com company can pick up $10 million
> or so in venture funding and make a bundle either on a quick initial public
> offering or acquisition, with nary a glance toward long-term viability --
> or long-term investors, for that matter.
>
> Nevertheless, the focus on money, money, money that we encounter daily in
> the Internet economy is almost impossible to discuss rationally in most
> quarters.
>
> Try telling someone hit by the money truck (or waiting to be) that the
> making of millions overnight does not justify the present means -- like
> poor business practices, rejection of even sensible government oversight
> and early profit-taking -- that leaves the dregs of dot-com reality for the
> public to deal with. Say that out loud and you, too, can live the
> experience of clearing a room in 10 seconds flat.
>
> But even to my somewhat jaundiced eye, it appears that something is shifting.
>
> Venture investors, the rocket fuel of the Internet economy, have started to
> question the path that so many Internet companies have taken -- despite the
> tremendous profit they make from the present state of affairs. In fact, at
> a recent conference, Doerr apologized to the assembled crowd for his "legal
> creation of wealth" remark, saying that he never expected everyone to focus
> on the money, to the exclusion of creating substantial businesses.
>
> He credits some of his new perspective to a book he has been brandishing in
> public the last couple of months. "The Monk and the Riddle: The Education
> of a Silicon Valley Entrepreneur" (Harvard Business School Press, 2000) was
> written by Randy Komisar, a longtime player in Silicon Valley.
>
> Komisar, in fact, has seen the game from nearly every angle -- lawyer,
> co-founder of the Claris Corp., chief executive of LucasArts Entertainment
> and Crystal Dynamics -- and has been increasingly dismayed by the focus on
> the getting of money at any personal cost. His book is a "stop the madness"
> cry from someone who has not only seen how the sausage is made, but has
> stuffed a few casings himself.
>
> "We're moving toward the toxic extreme of capitalism," Komisar said in an
> interview last week.
>
> Capitalism works better than any other market structure that has been
> devised, he added, because it harnesses man's "absolute base instincts --
> greed and aggression."
>
> But a focus on money, to the exclusion of substance and human
> relationships, he said, will ultimately fail, perhaps spectacularly.
>
> Indeed, it is becoming increasingly apparent that the "digital divide,"
> which lately has been given a lot of lip service but not much else, does
> not involve only the issue of which people have computers and which people
> do not. It also has to do with the attitude of those who hit the jackpot in
> our new casino economy and who are completely comfortable with pressing
> their advantage -- behaving with staggering hubris because they believe
> that merely having money entitles them to do so.
>
> "In the 60s it was all about 'wait until the revolution comes,'" Komisar
> said. "Well, guess what? If you take your billions and flaunt them in front
> of people who don't have enough to eat, ultimately you will get your
> revolution. You can't keep that toxic edge. It's not sustainable."
>
> Others are also planting flags for common sense and ethics. Another book,
> "The Cluetrain Manifesto," (Perseus Books, 2000) makes the case, as does
> Komisar's work, that Internet companies that ignore the people behind the
> computers are going to fail.
>
> The manifesto, which states unequivocally that the Internet changes the way
> people interact with businesses, profoundly and forever, has become a best
> seller. Doc Searls, a longtime marketing executive who is one of the
> manifesto's four authors, sees such a positive response as a source of
> hope.
>
> The change, he says, is in the balance of power -- from supply to demand,
> from the institution to the consumer -- and some investors are now starting
> to get the message.
>
> "The people in the crumbling ivory towers of old Fort Business are missing
> the fact that the real action in the marketplace consists of conversations
> that people are interested in," Searls says.
>
> Ultimately, companies will be successful to the degree that they open up to
> their customers and unsuccessful to the degree that they close down. "You
> either contribute or you don't," he adds. "That's how conversations work."
>
> For the last couple of months, Doerr, the venture capitalist, has been
> redefining success from an even broader perspective. In public forums, he
> has been encouraging a shift in focus from "mercenary" to "missionary,"
> asking executives to think about starting companies and building products
> that they believe will change the world, rather than merely amassing
> wealth.
>
> This is not much of a choice: zealotry rarely serves anyone besides the
> zealots. But if the metaphor jump-starts people into thinking about their
> actions and motivations, the overstatement may be worth it.
>
> "I am seeing the first signs of consciousness," Komisar said. "People are
> engaging in the discussion" about learning to be human in the context of
> what they do for a living. "There's a bit more introspection, at least from
> a significant group of people who have already made it. They have gone
> through the process and found themselves wanting."
>
> Few have yet gone so far as to reorder their priorities, he said. "I'm not
> expecting a radical change in my lifetime, but we have to back off from the
> brink."
>
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> 'By whom?'  Dorothy Parker, when told she was outspoken
>
> Denise Caruso
> 415.695.0508 vox/fax              http://www.caruso.com
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