Tapscott vs. Shirky

Two of today’s most sought-after authorities debate the ups and downs of our networked world.

Like a clever hook at the beginning of an astonishingly smart essay, followed up by an engaging kicker at the composition’s end, Don Tapscott and Clay Shirky opened and closed the TEDGlobal conference, respectively. Two of today’s most sought-after authorities on the networked world, Tapscott and Shirky analyzed and contextualized our era of social media eloquently—and with two distinctive, yet equally dynamic approaches. After TEDGlobal ended, we asked both of them to pose tough, stimulating questions to one another, via writing, during July and August, 2012. As you’ll see in these pages, each query was met with an elegant and thought-provoking answer likely to prompt further exploration and conversation.

Questions from Clay Shirky to Don Tapscott
Shirky: You’ve said that in the current Obama campaign, there has been a shift from driving for voter participation—“Yes We Can”—to voter targeting—“We Know You.” What would you do differently if you ran the Obama campaign?

Tapscott: I’d return to the winning strategy of 2008. Obama broke new ground by using social media as a powerful political tool that let supporters organize themselves to create communities, raise money, and induce people to not only vote, but also to actively support the Obama campaign. There were 35,000 communities involving 13 million supporters. “Yes We Can” wasn’t just a message of hope for the future; it was an assertion of collective power.

But this time, “Yes We Can” has been replaced by a new modus operandi for the Obama campaign. It’s now “We Know You.” The Democrats are investing heavily in Big Data to give them significant insights into the everyday behavior of each supporter.

This hurt him. Even deep into 2012, close to the election, fundraising was lagging. Young people in particular are alienated from a campaign that simply narrowcasts to them as passive individuals. And with youth not being involved, there is not only a crisis for the Obama campaign but also for the legitimacy of our political institutions in general. Obama needs to get past the advisors cautioning him to run a controlled campaign. They should encourage supporters to build communities around issues that they care about. Let go!

Shirky: More generally, businesses have always preferred targeting to collaboration in their relations with customers. What lessons are there for businesses in the tension between “Yes We Can” and “We Know You”?

Tapscott: Sure, Big Data, business intelligence, and next-generation analytics can help deliver more effective targeted communications to customers. And with detailed individual knowledge we can deliver better, personalized value (products and services) to them. But in many ways this is just fine-tuning of the old paradigm in marketing where companies deliver messages and value—one-way—to passive recipients. It’s just an extension of the broadcasting model of marketing: Customers are inert, and the goal is a transaction and not a relationship.

The much bigger opportunity for businesses is to go beyond targeting customers to engaging with them: from customer centricity to customer co-creation; from focusing on customers to co-innovating with them; from mass customization to mass collaboration.

Companies need to be transparent to build trust and engagement. They need to launch and participate in customer communities and encourage customers to self-organize. And they need to craft business models that enable customers to share in the creation of value. If Threadless.com can do it, anyone can.

Shirky: You have called our times “The Age of Transparency,” arguing that institutions are becoming naked and will have to get buff. Isn’t this a threat to most?

Tapscott: Until recently, most institutions were opaque and operated secretly. With the Internet’s arrival, this is no longer possible. People everywhere have at their fingertips the most powerful tool ever for finding out what’s really going on and for informing others. Customers can evaluate the worth of products and services at levels not possible before. Employees share formerly secret information about corporate strategy, management, and challenges. To collaborate effectively, companies and their business partners have no choice but to share intimate knowledge. Powerful institutional investors are developing X-ray vision. And in a world of instant communications, whistleblowers, inquisitive media, and Googling, citizens and communities routinely put firms under the microscope.

So to me it makes sense to embrace transparency, not just because it’s inevitable, but also because it’s good for you. I define transparency as the opportunity and obligation of institutions to provide pertinent information to stakeholders, like customers, employees, business partners, and shareholders—“pertinent” meaning it can help them if they have this information. Providing useless information is not being transparent.

Evidence suggests open institutions will perform better—and in many cases they already are. They will have higher trust and be able to build better networks. Transparency drops transaction costs and the error rate in supply chains. It increases the metabolism of collaboration and loyalty with employees. It helps organizations create good value—because value is evidenced like never before. And if your company is buff, you can “undress for success.” Transparency is a new form of power, which pays off when harnessed.

So rather than fighting it, every company and government needs a transparency strategy. It has to rethink what information should be made available to each stakeholder class.

Shirky: You recently asked, “Is privacy an outmoded idea in the digital age?” A question like that doesn’t seem to have a simple yes-or-no answer. How should we approach the question in an era when so many old assumptions about privacy are changing?

Tapscott: This is a complex topic. For sure our attitudes about privacy are changing. I find myself sharing all kinds of information—largely because the benefits to me outweigh the costs. When we reveal personal information we can help society too. Every time a gay person comes out, or someone with depression opens up about their condition, they break down stigma and prejudice. Fully 20 percent of all patients with the fatal disease ALS (amyotrophic lateral sclerosis, or Lou Gehrig’s disease) share intimate information about their treatments and conditions on the network PatientsLikeMe.com. And tens of thousands of others with rare diseases who use the site to share information say it has helped them better manage their illness.

But this doesn’t mean that privacy is an outmoded idea. Rather, it’s worth defending.

To me, privacy is nothing if not the freedom to be let alone, to experiment and to make mistakes, to forget and to start anew, to act according to conscience, and to be free from the oppressive scrutiny and opinions of others.

But today we are collectively creating, storing, and communicating information at nearly exponential rates of growth. Most of this data is personally identifiable, and third parties control much of it. Practical obscurity—the basis for privacy norms throughout history—is in danger.

The fundamental problem with the case of radical personal openness is that we are a long way from a world where being an open book will not hurt us. There is the injury to individuals that arises from unauthorized disclosure of sensitive personal information, but tangible harms and damages can also occur, too, such as from blackmail, identity fraud, impersonation, and cyber-stalkers.

As for governments, I think the advocates of “personal openness” are naïve, thinking that governments are always benevolent toward their citizens. In fact, likely the future will not look like Orwell’s 1984 or Jeremy Bentham’s panopticon prison, or an Eastern bloc police state during the Cold War. Those are metaphors from another era that depended upon a single, all-knowing malevolent power seeking control. The more appropriate metaphor for the growing loss of privacy today would be Frank Kafka’s The Trial, where the central character awaits trial and judgment from an inscrutable bureaucracy for a crime that he is not told about, using evidence that is never revealed to him, in a process that is equally random and inscrutable. Similarly, we could become the targets of social engineering, decisions and discrimination. And we will never really know what, or why.

“Transparency, even radical transparency, is an opportunity and responsibility for companies, governments, and other institutions. But the new movement toward ‘personal sharing’ is naïve and misguided. Transparency applies fundamentally to institutions, not to individuals.”

Corporate profiling, data mining, and Big Data also have a dark side. Do we comprehend the implications of a world where corporations have near perfect information about each of us? Knowledge is power. Could firms go beyond fairly influencing us, to being able to manipulate us or cause qualitatively greater dangerous consumer behavior in society?

On a more fundamental level, privacy is essential to human relationships, as strong ties arise from sharing secrets and forging information symmetries. Privacy is even a foundation of the formation and maintenance of the self and of how we manage our reputations. Irving Goffman’s seminal 1959 text “The Presentation of Self in Everyday Life” needs an update. Personal information is the stuff that makes up our modern identity and is the foundation of our personal security. It must be managed responsibly—not just by others, but also by each of us.

I’ve argued for many years that transparency, even radical transparency, is an opportunity and responsibility for companies, governments, and other institutions. But the new movement toward “personal sharing” is naïve and misguided. Transparency applies fundamentally to institutions, not to individuals.

Rather than living our lives out loud, we each need a personal privacy strategy governing what information we release and to whom. Rather than default to openness, we should default to privacy, and then choose to share information when the benefits outweigh the dangers.

Shirky: You’ve written so much about the different ways young people see the world, having grown up with the affordances of the Internet and mobile phones. Given the enormity of the gap in attitudes and behaviors between people as close in age as people in their late 20s and people in their late 40s, we still have a full generation of greatly differing perspectives to work out. Do you think the views of the young will win by demographics, or that a big cultural rift is coming, or that people who didn’t grow up digital will eventually adopt the outlook and norms of those who did?

Tapscott: It’s true that there is variability within the Net generation (born 1978–1997). But the differences between them and other generations overall are much greater. The main difference is that because of their early immersion in technology, their brains work differently. These are also generational differences, not life-stage differences as some have suggested, and this is the first time in history when children are authorities on something really important to society. My study of 11,000 young people in 10 countries revealed they are also the first ever-global generation with (at least) eight norms that differentiate them from their Boomer parents and Gen-X predecessors.

However, I do agree that people who didn’t grow up digital will move toward these norms. In the Net generation culture, we can see the new culture of work, the new marketplace, and even the new citizenship. There are problems and exceptions, but overall it’s a culture of freedom, customization, scrutiny, integrity, collaboration, fun, speed, and entertainment. But given that a third of the human brain develops during extended adolescence, brain plasticity notwithstanding, many ways of thinking and learning will continue to differentiate them. As for the kids born after 1998, they are probably a whole other story.


Questions from Don Tapscott to Clay Shirky
Tapscott: In the Arab Spring “the revolution” was tweeted. But because they are leaderless in the traditional sense, wiki revolutions seem to create a vacuum, in many instances, filled with unsavory forces. How can the media help activists actually form progressive governments?

Shirky: This is a long-term issue. We’ve known for some time now that the Internet is better at “No” than “Go,” in the words of Micah Sifry. Five years ago, I was giving talks with slides of Amish barn raisings, saying “We need to figure out a way to use the network for this sort of constructive work,” but I’ve since come to conclude that the Internet is better at No than Go, which is to say it is a medium that favors extensive ties over intensive ones.

The thing that most changed my mind was a book by Pierre Rossonvallon called Counter-Democracy, which unearths the aspects of democratic participation that are about citizen suspicion of the state. Rossonvallon says that the ways that we stop the state from doing certain things are not only an underappreciated part of democracy, but logically and historically exist prior to establishing mechanisms like voting and parliaments.

The grain of the Internet seems to favor coalitions built on the intersection of people’s goals, not the union of those goals. This makes it good for movements and bad for political parties, at least as historically conceived. So I’d say we should expect to see a lot more knocking down of existing structures, while the work of building new ones based on deep integration remains as hard as ever.

Given the number of really bad existing structures, this is still a huge net win for humanity. Until last year, for instance, there was not one Arab democracy, and now there are three (three and counting, is my bet).

This strikes me as a huge improvement—the people who are shocked or disappointed that the outcome of the Arab Spring was not an instant move to Norway in the Maghreb should take a look at the early history of long-lived democracies. The United States got it so wrong at the beginning, we had to throw out the entire system and start from scratch. That process took 15 years, and even then we had to have a civil war.

So we should take it for granted that the Internet is best as a tool for wide coalitions, which tend, by default, to be oppositional, while still looking for ways to use it as an input to the propositional work of saying what should replace the current system.

Right now, the best the Net can do for that latter category is make it easier for people to communicate about the kind of government they want and, when they are ready, to engage in the serious trade-offs needed to make a real government. The Net doesn’t do much to make people ready for those trade-offs, however.

Tapscott: How can we inform ourselves as individuals and as a society if the traditional model of the newspaper is collapsing?

Shirky: The single most important thing for an individual to do is to recognize that society is not made up of individuals but of groups, some tight and some loose. Democracies are not markets, divided into atomized and rational actors. Democracies are coalitional, and the big thing we lose with the continuing shrinking of the importance of newspapers is having a place where news junkies and sports fans both occasionally see the same front page.

If we leave it to individuals to inform themselves, the news junkies will simply pull away from the rest of society. We’ll have a tiny core of hyper-informed individuals and a large mass of people who don’t know and don’t care about politics, as we’ve always had, but we’ll lose the group in the middle that followed the news a bit.

As news sources become more variable and news consumption becomes more voluntary, the single best thing individuals can do is to share what they care about. We still sometimes fall into the old thought that people are receptacles of political ideas, sent there by politicians and parties working through the media.

The promise of democracy, though, is that people can also be sources of political ideas, either by expressing their own or amplifying others’ ideas. So the best thing for democracy right now would be for people to share more expressly political speech, speech they approve of and speech they revile, on their social networks.

We have an opportunity to break out of the “informed citizen” model and get to something where political ideas are really in circulation among voters, and there are some hints that this is happening. In the United States, 2012 is an election year, so the change may be temporary, but a culture where individuals circulate political ideas among themselves, whatever the original source, would be a terrific upgrade.

Tapscott: There may be a multitrillion hour-per-year cognitive surplus of free time, but isn’t the persistent media diet of most people (television and other low-minded activities) cause for pessimism?

Shirky: Surveying the human condition, there’s always cause for pessimism, but in this case, I’d adopt a tempered pessimism. Wired young people watch less TV than previous generations did, and when they do watch it, they watch it while they are also connected to friends. The high-water mark of isolated, passive media consumption is largely in the past; younger people do not seem to be adopting the extremes of the disconnected consumption of the 20th century.

This is, so far, a change limited to a particular cohort, but I also remember being told, in the early 1990s, that I was a ridiculous geek, and it wasn’t like everyone was going to (take your pick) own a computer, have an email address, use the Web, read on a screen, etc., etc.

The other case for tempered pessimism is that the examples we have of group creation don’t rely on wholesale change—whether you are looking at examples of amateur collaboration (digitizing old ship logs, figuring out how proteins fold), sites of cultural production (Pinterest, YouTube), collaborative consumption (Freecycle, CouchSurfing) or new kinds of conversational value (Quora, Reddit). Each of these initiatives requires only a small percentage of the population to donate a small percentage of time to making or sharing to have an outsized effect.

This is, for me, the biggest driving force in our use of the cognitive surplus: considering that by the end of the 20th century, the total time spent in media consumption, with no accompanying production or sharing and even precious little annotation or discussion, is a situation so different from ours in the early 21st century. This shows that even small changes in behavior can have outsized outcomes for the culture.

Whatever the new balance between passive and active consumption becomes, the early changes are quite dramatic, because these projects of joint creation are so unusual.

Tapscott: The Canadian government is about to pass more restrictive copyright legislation to “protect” intellectual property from thieving children and other pirates. If not pursuing SOPA (the Stop Online Piracy Act) and its myriad variants, what should governments do?

Shirky: The first thing, a precursor to whatever the new bargain is, is to abandon copyright maximalism, the doctrine that says that the only rationale for copyright (or intellectual property, generally) is to give businesses the right to rent-extraction over the population.

Copyright law, as rationalized since the Statute of Anne in Great Britain in 1710, has always had significant provisions for the value to the public for creative work, and ideas like limited duration, required library deposit, and the public domain were part of the bargain from the beginning.

That balance has been all but destroyed—in the United States, copyright has effectively become infinite, because every time works from the early 1920s start coming to the end of their term, Hollywood gets Congress to extend the term.

So I am somewhat impatient with this idea that “something must be done” in the short term, as if there was a technical or legal fix to a system with a broken model. What we need is a government willing to say “Copyright is and has always been a bargain between creating a market for creative work to create incentives, and creating a cultural commons to create value for the citizens,” and then start reasoning about how such a bargain will be worked out in a world with an Internet.

There are lots of technical ideas that might work, from ASCAP-style licensing to distributed patronage in return for early access, but none of them can even be discussed as long as Hollywood says, “The law must preserve our 20th-century victory over the public’s rights under copyright law!”

Tapscott: Are we in a new tech bubble? What’s different today from the dot com–era tech marketplace?

Shirky: Back to front, the biggest difference between the 1996–2000 marketplace and now is that the current market isn’t an undifferentiated mass of excitement and confusion, and the appearance of the word “Internet” doesn’t cause people to lose their minds.

The market in the late 1990s made very little distinction between platform companies like Netscape, access companies like AOL, commerce companies like Amazon, and media companies like Tripod. The result wasn’t just that valuations were unsustainably high, but that companies that were nothing but hype, like TheGlobe [an early online community], were favorably compared to ones that actually created real value in the long term, like eBay.

In those days, overvaluing good companies was a problem, but wildly overvaluing worthless ones was a catastrophe.

By that metric, we are not in a bubble. There is some debate about the net present value of Groupon or Facebook, but no one doubts that those are businesses with real assets and revenues, and no one thinks of Groupon as being in the same business as Zipcar, or the Huffington Post, or Twitter.

I think the more sober-minded segmenting of the market, and the more public willingness to air skepticism about any given firm and then to have such skepticism be heard, will keep any market corrections pretty minimal, at least by 2000 bubble standards. As always, some firms will turn out to be overvalued and others undervalued, but we’re not facing a general grouping of all businesses that use the Internet into one “sector” anymore, largely because all businesses now use the Internet.

Photography by James Duncan Davidson, courtesy of TED

Don Tapscott is the author of 14 books and an adjunct professor at the Rotman School of Management, University of Toronto. He has just launched the Don Tapscott App for the iPad. He was a speaker at TEDGlobal 2012. Follow him on Twitter: @dtapscott.

Clay Shirky writes and speaks extensively about the Internet’s effects on society and is the author of two books on the subject. He teaches at New York University. He was a speaker at TEDGlobal 2012. Follow him on Twitter: @cshirky.

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