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Welcome! You are in the right place if you are
enrolled in Medaille
College's MBA 600 in Fall 2006
interested in information technology
interested in Medaille's curriculum
this page
webcentricity
what's at stake? | bits vs
atoms | mgm vs grokster
what's next?
the hype | the reality |
the bottom line
Welcome to the final MBA 600. It ran eighteen times from 1998 to 2006, and I taught all but the first three to almost two hundred students.
How's that for a five-dollar word? Also known as netcentricity, it refers to organizations' reorganizing themselves around the Web and the Internet. The Web's only ten years old, so the change process hasn't been going on for long. Potentially, it changes almost everything. While the changes now exist here and there in a few isolated areas of most organizations, it has totally transformed very few organizations. Yet every organization has to face the Internet, like a freight train barreling at them through a one-track tunnel. The whistle's blowing!
For starters, every organization that has telephones and computers has to ask, do we get email? Do we have a Web site?
The answer seems so simple, "Of course we have email and a Web site." Then what? The implications are not so simple.
The Internet is
not a thing; it's an agreement. It's not a natural environment; it's a built
environment.
Is it like the park, an open area where we can meet and talk? Or is
it like Disneyland, where you have to pay (in $$ or personal info or attention) to get in and you're always watched?
Can
you do almost anything you want to on the Internet, even if it has never been done before? Or do
you have to ask for permission? From whom?
Ask the same questions about your web site: Is it an open area or a one-way street: the company to the customer? Who's in charge? It used to be obvious: the company. After you take this course, you will know that's not true anymore.
The universe is full of magical things patiently waiting for
our wits to grow sharper.
-- Eden Phillpotts
Our shared culture. Your ability to make money in new and interesting ways. What Benkler below calls "the deep structure of our information environment". Progress.
That seems like so much, and it is. It will take you longer than this course to figure it out. So let's get started.
What's your metaphor? Learn more about the importance of Internet neutrality.
Darknet:
Hollywood's War Against the Digital Generation
by J.D. Lasica
The controversy over internet piracy is a subplot to a much larger drama. This is a battle about how we may use, own and share digital media. As more people create personal media and begin to participate in culture, we see backlash from major entertainment companies seeking to control all uses or reuses of their works, even at the expense of citizens' traditional rights.
You can't distribute cars through the Internet. While the GMs and GEs of the world can transform their business to ebusiness, they're still manufacturing and selling atoms. What about a company that thinks it is manufacturing and selling atoms -- for example, a CD, a product. But it turns out that it is really manufacturing and selling bits -- for example, music, that is, data.
Let's look at Napster, the old Napster from the turn of the century that got sued out of business by the companies it was threatening.
Technology Pros
Discuss What Comes After the Fall
by Judith H. Dobrzynski
New York Times, July 29, 2001
Q. What do you tell 40 million kids who know how to turn a
product into data that they can trade freely?
A. You teach them some values.... If you don't have the ability to protect that
which you create, society falls apart.
Society falls apart? That answer comes from Craig
Barrett (left), Intel's CEO. His current paycheck may go away. His current stock
portfolio may lose value. But society will fall apart?
In the summer of 2000, the Recording Industry Association of America got a judge to rule that she was shocked, SHOCKED to learn that people were using the Internet to share copyrighted files. Stop that right away, she said. She called Napster a "monster".
Hel-LO? Even then, it was a little late -- by at least 15 years if not 25 -- to start worrying about file sharing. That's the point of the Internet. That's its organizing principle -- from my screen and speakers to yours. From yours back to mine. From everyone's to everyone's. Six summers after the judge was so shocked, peer-to-peer file sharing has increased by orders of magnitude. Here's the source of the problem:
The Internet is an open-source self-organizing adaptive many-to-many peer-to-peer international file-sharing public collaborative agreement based on human goodwill, which means it's teetering on anarchy. Throughout human culture, this commons has been the fertile ground of cultural innovation.
In corporate terms, an agreement to share is a threat to hierarchical control structures, like record labels.
In this sense, the Internet differs from most business organizations, which are top-down, inflexible, information-hoarding, for-profit corporations with legal status. You can sue them. They can sue you and each other. The Internet can't sue or be sued.
These business organizations have been built over the last hundred years with legal protections and sanctions. The commercial code of laws and the regulations supporting them are voluminous, contradictory, overwhelming, confusing, and hard to follow in practice. And expensive. The cost of regulation and litigation is measured in the billions of dollars annually. Since the 2000 presidential election, regulation has increased dramatically. Business has never been as regulated in the U.S. as it is now.
The Internet is not a thing. It's an agreement to share specific protocols for exchanging information. It was built to withstand nuclear attack, so a judge's ruling or an antiquarian copyright law isn't going to stop people from using it. The network is the computer. It routes around damage like bombs and judges and laws.
Libertarianism
Good and Bad
by David Weinberger
Darwin Online, July 30, 2001
The Net's value is due to the fact that it is a place to
express ideas. Mill's libertarianism is perfectly applicable: we assume freedom
of expression and any attempts to thwart expression need to show how it impinges
on other rights. ...
In fact, Mill's libertarianism is built into the very architecture of the Net,
albeit not expressly for political reasons. The designers wanted to create an
infrastructure that could be extended without having to alter the core
protocols. So, they designed those protocols to encode the minimum information
required to deliver bits. What you want to do with the bits is up to you. The
designers thus created the environment that Mill had in mind — rather than
having to go to a centralized bureaucracy to get permission, permission is the
default.
The two extremes: permission is the default, but society falls
apart. It almost rhymes, doesn't it? The unstoppable force and the immovable
object. The Internet and society. In terms of MBA 600, the Internet and the
organization. The Internet versus the organization. If permission is the default, will your organization fall apart?
The data are ones and zeros. The computer doesn't care whether the data expresses music or words or images or trade secrets. The network is just a bit-pipe. That's its genius. It's stupid.
In June 2005, the US Supreme Court ruled that the movie studios -- and thus other content owners -- could sue companies that intend for their customers to violate copyright as "shown by the clear expression or other affirmative steps taken to foster infringement". In this case, the studios were suing Grokster and others.
In effect, the Court slowed progress by making it riskier to invest in start-up companies that may disrupt an incumbent industry, especially one who has the deep pockets to use Grokster as the basis for an expensive lawsuit.
But that's just a finger in the dike. The Dutch boy is the movie studio. The dike itself is copyright law. And behind it is a lot of pent up, inexorable water, demanding to be let loose.
In Grokster, the Supreme Court ruled in June 2005 that companies can be sued. Ok. Then what about software that is made by volunteers and distributed for free, no legal company involved? Whom to sue? What to collect?
You know something frightening is happening when people start
to use religious metaphors.
The BitTorrent Effect
by Clive Thompson
Wired, January 2005
Movie studios hate it. File-swappers love it. Bram Cohen's
blazing-fast P2P software has turned the Internet into a universal TiVo. For
free video-on-demand, just click here. ...
In November, the Motion Picture Association of America began suing downloaders
of movies, in order to, as the MPAA's antipiracy chief John Malcolm put it,
"avoid the fate of the music industry." ...
BitTorrent is something deeper and more subtle. It's a technology that is
changing the landscape of broadcast media.
"All hell's about to break loose," says Brad Burnham, a venture capitalist with
Union Square Ventures in Manhattan, which studies the impact of new technology
on traditional media. BitTorrent does not require the wires or airwaves that the
cable and network giants have spent billions constructing and buying. And it
pounds the final nail into the coffin of must-see, appointment television.
BitTorrent transforms the Internet into the world's largest TiVo.
One example of how the world has already changed: Gary Lerhaupt, a graduate
student in computer science at Stanford, became fascinated with Outfoxed, the
documentary critical of Fox News, and thought more people should see it. So he
convinced the film's producer to let him put a chunk of it on his Web site for
free, as a 500-Mbyte torrent. Within two months, nearly 1,500 people downloaded
it. That's almost 750 gigs of traffic, a heck of a wallop. But to get the ball
rolling, Lerhaupt's site needed to serve up only 5 gigs. After that, the peers
took over and hosted it themselves. His bill for that bandwidth? $4. There are
drinks at Starbucks that cost more. "It's amazing - I'm a movie distributor," he
says. "If I had my own content, I'd be a TV station."
During the last century, movie and TV companies had to be massive to afford
distribution. Those economies of scale aren't needed anymore. Will the future of
broadcasting need networks, or even channels? ...
If enough people start getting their TV online, it will drastically change the
nature of the medium. Normally, the buzz for a show builds gradually; it takes a
few weeks or even a whole season for a loyal viewership to lock in. But in a
BitTorrented broadcast world, things are more volatile. Once a show becomes
slightly popular - or once it has a handful of well-connected proselytizers -
multiplier effects will take over, and it could become insanely popular
overnight. The pass-around effect of blogs, email, and RSS creates a roving,
instant audience for a hot show or segment. The whole concept of must-see TV
changes from being something you stop and watch every Thursday to something you
gotta check out right now, dude. Just click here.
What exactly would a next-generation broadcaster look like? The VCs at
Union
Square Ventures don't know, though they'd love to invest in one.
Union Square Ventures' blog says, "It's an exciting time with a lot of change afoot. And that should be a recipe for some good venture opportunities. If you see this world evolving similarly to us and are building a company to take advantage of this opportunity, we'd like to hear from you."
That's what this course is about, your building a company to take advantage of the opportunity provided by the Internet.
How BitTorrent works. List of torrents.
Why don't "they" do something? Well, they try.
The list of torrents above is on a server in the Netherlands. The Pirate Bay is a BitTorrent tracking site in Sweden with 150,000 users a day. In August 2004, it posted a torrent for Shrek 2.
A couple of weeks later, Dreamworks sent a cease-and-desist letter demanding the site remove it.
Pirate Bay's response:
As you may or may not be aware, Sweden is not a state in the United States of America. Sweden is a country in northern Europe [and] US law does not apply here. … It is the opinion of us and our lawyers that you are fucking morons.
Shrek 2 stayed up.
Then the MPAA got the Swedish police to raid The Pirate Bay's ISP and confiscate the servers. Guess what happened?
At a recent holiday celebration, I spoke to a friend's elderly aunt. She has never been online and was dismayed to hear what I taught. I claimed that no one can get a respectable graduate education in 2006 in any subject without spending a lot of time online. To her, the Internet is sin: porn, incest, predator pedophiles. At least, I said, it's not killing people like another technology, automobiles. She said that it would be better to die in a car wreck. "That's only your body. On the Internet, you lose your soul."
I asked her to pass the eggnog.
more from
The BitTorrent Effect
by Clive Thompson
Wired, January 2005
For [BitTorrent creator Bram]
Cohen (left), it's all a little surreal. He gets up in the morning, helps his wife feed
their children, and then sits down at his cord-and-computer-choked desk to watch
his PayPal account fill up with donations from grateful BitTorrent users -
enough to support his family. Then he goes online to see how many more people
have downloaded the program: At this rate, it'll be 40 million by 2006. ...
Paradoxically, BitTorrent's architecture means that the more popular the file is
the faster it downloads - because more people are pitching in. Better yet, it's
a virtuous cycle. Users download and share at the same time; as soon as someone
receives even a single piece of Meet the Fockers, his computer immediately
begins offering it to others. The more files you're willing to share, the faster
any individual torrent downloads to your computer. This prevents people from
leeching, a classic P2P problem in which too many people download files and
refuse to upload, creating a drain on the system. "Give and ye shall receive"
became Cohen's motto, which he printed on T-shirts and sold to supporters. ...
Cohen knows the havoc he has wrought. In November, he spoke at a Los Angeles
awards show and conference organized by Billboard, the weekly paper of the music
business. After hobnobbing with "content people" from the record and movie
industries, he realized that "the content people have no clue. I mean, no clue.
The cost of bandwidth is going down to nothing. And the size of hard drives is
getting so big, and they're so cheap, that pretty soon you'll have every song
you own on one hard drive. The content distribution industry is going to
evaporate." Cohen said as much at the conference's panel discussion on
file-sharing. The audience sat in a stunned silence, their mouths agape at
Cohen's audacity.
Cohen seems curiously unmoved by the storm raging around him. "With BitTorrent,
the cat's out of the bag," he shrugs.
Let's follow Cohen's thought about cheap storage. In a couple of years, every song ever recorded will fit onto a tiny chip and will be cheap enough to give away with a cup of coffee at Starbucks. Note that Cohen said that the content distribution industry as we know it will evaporate, not the content production industry. I predict that as it has in the past with new technologies -- radio, movies, TV -- it should explode as musicians and widely distributed audiences find each other.
The Shadow Internet
by Jeff Howe
Wired, January 2005
They start with a single stolen file and pump out bootleg
games and movies by the millions. Inside the pirate networks that are
terrorizing the entertainment business. ...
Anathema is a so-called topsite, one of 30 or so underground, highly secretive
servers where nearly all of the unlicensed music, movies, and videogames
available on the Internet originate. ...
It's a commonly held belief that P2P is about sharing files. It's an appealing,
democratic notion: Consumers rip the movies and music they buy and post them
online. But that's not quite how it works.
In reality, the number of files on the Net ripped from store-bought CDs, DVDs,
and videogames is statistically negligible. People don't share what they buy;
they share what is already being shared - the countless descendants of a single
"Adam and Eve" file. Even this is probably stolen; pirates have infiltrated the
entertainment industry and usually obtain and rip content long before the public
ever has a chance to buy it.
The whole shebang - the topsites, the pyramid, and the P2P networks girding it
all together - is not about trading or sharing at all. It's a broadcast system.
...
On June 6, two weeks before its official release, a near-final version of The
Hulk showed up online. To hear studio executives tell it, the bootleg went
straight to the P2P networks and spread like a contagion.
"Bullshit," says Forest. "Trying to distribute The Hulk through the P2Ps would
take months, not hours. ... Here's what actually happened: Universal gave the workprint to its Manhattan ad agency. Then the print got to SMF. And bam!" SMF,
Forest explains, is a piracy group that specializes in acquiring movies in
theatrical release. ...
Within an hour, word had spread that The Hulk had appeared on the topsites, and
the "races" began - copying and distributing the files to as many other servers
as possible, as quickly as possible. "The races are over like that," says
Forest, snapping his fingers. "It's amazing." ...
The kids in the scene aren't trying to bomb the system. They don't care a whit
whether major labels suffer more from file-sharing than indie labels, or if a
ban on prerelease DVDs affects Miramax's chances at the Academy Awards. They do
this because it feels mildly rebellious, like smoking a doobie behind the local
Kroger or setting off the school fire alarm - and because it's fun.
Faster connections always bring major changes
by Andrew Kantor
USA Today, July 15, 2005
Students love [i2hub].
And, shockingly, not so much for sharing research or work, but for — you guessed
it — music and movies.
A song shared on the network? Download it in seconds. A full-length DVD movie? A
few minutes.
That thumping you hear is the entertainment industry whacking its collective
head on the nearest table.
The recording industry has already filed
hundreds of lawsuits against i2hub users in its ongoing public-relations
campaign. ("Do what we say and no one gets hurt.") ...
What these entertainment-industry people fail to get is that they're throwing
rocks at a locomotive. You'll scare a few passengers, and maybe hurt someone,
but you're not stopping the train.
Supercharged college P2P network closes
by John Borland
CNET News.com, November 14, 2005
A file-swapping network that let college students download movies and music at blazing speeds on the Internet2 research network has closed its doors, the latest casualty of entertainment industry legal pressure.
These quotations all come from the September 2002 issue of Business2.0. Look at the organizations they represent.
We want to live on the Web.
-- John Leggate, Group VP, British Petroleum
Everyone will be on the same network, from mud to space,
from foxhole to Pentagon.
-- Peter Cuviello, CIO, US Army
We use technology to show the customer what's going on
inside the business, with online real-time information. ... As soon as you try
to control, you fail.
-- Rob Carter, CIO, Fedex
This course anticipates that you will spend most of your working life in an organization making the transition to e-business. It will be a media-saturated organization in which information is available everywhere all the time. How will information become knowledge? How will it be acquired, updated, retrieved, preserved, disseminated, and owned?
How will you think about information differently? What will you do differently?
What do you do, meanwhile, when your boss acts like the SHOCKED judge, who clearly doesn't get it? When your industry association acts like the RIAA? When your company works for the short-term profit of its stockholders rather than the long-term interests of its customers or its employees or, heaven forbid, human life as a whole.
Will the recording industry drive music lovers (aka "thieves") underground? Even links like this one have been successfully challenged in court. If the recording industry loses in court, it owes it to its shareholders to fight on the technology front. Will sales rise or fall as a result?
The knowledge, skills, and especially attitudes that you develop here will improve your employability and productivity because:
the computer is primarily a medium of human communication, not corporate marketing or back-office record keeping
the television, computer, telephone, and printing press are converging to create a high-bandwidth always-on network, now called the World Wide Web
growth of this new worldwide many-to-many network is creating a wired culture and a knowledge economy
customer-centered business processes will drive webcentric organizations
MBAs are playing a central role in developing this culture, this economy, its knowledge workers, and their knowledge spaces
Mastering this new medium can give you power and autonomy at work. It also lets organizations abandon the model of power as information hoarding for a new model: power as information sharing. Until we had the telephone, few organizations had more than a hundred employees. Now that we have the Internet, the corporate firewalls are riddled with holes: "sufficient supply chain visibility".
Will you represent the forces of the past that want to monetize and control our shared culture, our commons? Or will you represent the forces of the future that want to find new ways, new products, and new services even at the expense of the hallowed past?
Alan Kay notes in "The Computer Revolution Hasn't Happened Yet" (RealVideo -- 56k) that the car at first masqueraded as a better horse and buggy. Similarly, the computer is still masquerading as better paper. A web site like Ricci Street is masquerading as a better textbook. "As usual," Alan Kay writes, "it will be much easier to predict and invent the technology than to help people make better use of it."
Any sufficiently advanced technology is indistinguishable
from magic.
-- Arthur C. Clarke
Technology is the name we give to stuff that doesn't work yet.
MBA 600 is designed to teach you how to research and analyze an industry that you or your company is thinking about entering as a competitor, partner, supplier, or buyer.
This semester, we will use the pop music industry as the case study. Because it is going through disruption caused by the Internet, this course is also designed to teach you how to analyze and plan to take advantage of such disruption in any industry or any process within an industry.
Finally, the same analysis will teach you, if you are a thriving business, how to respond to the threat of competition from substitutes and new entrants.
In order to understand that disruption, you need to better
understand the nature of the Internet and where the pop music industry is
vulnerable to it.
Entrepreneurs, as well as intrapreneurs (managers in business organizations),
write business plans that carefully and rationally analyze a situation and
explain how their start-up or their organization can make money in that
industry. But to make money, they must first spend money.
They ask for that spending money from investors, which include banks, state and
local governments, potential business partners (suppliers and buyers), private
individuals, aka angels, and managed investment funds, aka venture capitalists.
In short, by the end of October, each of you will have written a plausible
business plan to compete in the pop music industry based on a rational
(data-driven, clearly thought out) analysis of the industry and the pressures
put on it by the Internet. You will present your plan to a group of investors
(your classmates). This oral presentation will be accompanied by a web site that
will make your business plan publicly available in an interesting and attractive
manner. Your plan will be yours; this is not a team effort though you will find
many opportunities to cooperate and share with your classmates.
The American Association of University Professors (AAUP) describes the president of an institution of higher education in a way that I have adapted below to the president of a business organization or a part of an organization.
The president, as the chief executive officer of the
organization, is measured largely by his or her capacity for organizational
leadership. The president shares responsibility for the definition and
attainment of goals, for administrative action, and for operating the
communications system which links the components of the organization. The
president represents the organization to its many publics. The president's
leadership role is supported by delegated authority from the board of directors
and management.
As the chief planning officer of an organization, the president has a special
obligation to innovate and initiate. The degree to which a president can
envision new horizons for the organization, and can persuade others to see them
and to work toward them, will often constitute the chief measure of the
president's administration.
Why then, do presidents not succeed?
The Real Reasons Why CEOs Get Fired
Leadership IQ, June 20, 2005
It's a commonly-held belief that CEOs get fired (or forced
to resign or retire under pressure) because of "current financial performance."
But that's wrong, according to a new study by LeadershipIQ.com. It found that
31%
of CEOs get fired for mismanaging change
28%
for ignoring customers
27%
for tolerating low performers
23%
for denying reality
22%
for too much talk and not enough action.
This course will increase your capacity for visionary leadership enabling innovation. It will also help you to accept reality by giving you a clearer vision of the horizon.
This course moves directly and smoothly into MBA 604 Marketing with New Media.
You're heading for the Lecture Hall on the balmy Saturday of December 16. You have rented it at a trade show, and you have scheduled your presentation for 15 minutes, about as long as you can expect people to sit still and pay attention.
There you will
make a dazzling presentation of a great new business idea. Your audience will be
those in your industry, a group of potential customers, partners, competitors,
suppliers, and employees. You had best entertain them, too, and get them
energized and excited about doing business with your company. Or fearful of
competition with your company.
To help you visualize ...
International CES - Show Floor Buzz - Fact Sheet's product categories
The International CES photo library shows you a cross-section of the people, the products, and the high-energy show floor.
Behind the magic curtain
by Mike Evangelist
The Guardian, January 5, 2006
Next week Steve Jobs of Apple will grab media attention with another simple-looking stage show. Mike Evangelist tells the insider secrets of his gruelling preparation.
To do this presentation well, you're going to need products and services to talk about, a relationship to make attractive to your customers, and strategies and policies to make you attractive to your suppliers and partners and fearful to your competitors. In addition, you're going to need marketing materials to hold up and distribute -- brochures and other printed material -- and other media assets to display on the screen -- logos, images, banners, web sites, videos, TV commercials, etc.
This course will lead you through the process of getting to the Lecture Hall stage with an effective presentation.
Find out all the official stuff. How is this course described in the college catalog? What are you going to know more about? What are you going to know how to do better? What's the self-assessment all about?
This is the page to bookmark. It will change often and be the place to learn what we're going to do in class as well as what you should do before class.
In this course, you'll learn by doing. You're going to do a lot of web surfing and well as research. You're going to make several presentations and make webs to accompanying the presentations. We're going to pretend that you work for New Media Ventures, Inc., and that I'm your boss. If the course were Mission Impossible, the case page would be the tape-recorded message at the beginning of each episode, except that it wouldn't self-destruct until the beginning of April, when the course is over. "If you choose to accept this mission, ... ."
The knowledge and skills in this course are covered copiously on the Internet. The music industry case especially is breaking news. I put articles -- links and excerpts -- onto this page as Signs of the Times and Ripples and Quakes.
The ideas at the top of this page are meant to be provocative. The Ground Zero Bistro is the place to talk about it. Ask questions and get answers.
All my other course webs have one. For this section of MBA 600, I incorporated the information that was on the reports page into the syllabus page. All that's left on the reports page is a class directory and list of Roundtables.
We do not spend our lives communicating information and collections of data and experiences. Instead, we communicate ways of seeing that enable us to interpret information, a set of data, and experiences. This is difficult to do in class, face-to-face on the fly. The Roundtable will give you a chance to consider your ideas and to continue developing them after other students respond.
Carefully chosen words, crafted paragraphs, and logical arguments are terrific tools for communicating in organizations and for influencing others. This course addresses so many hot current issues and events that it's hard to know where to begin. The Roundtable gives you a dozen or so common readings and focused questions to address yourselves to in an orderly manner.
Printer-friendly version of the Course Disclosure Statement
I am always doing what I cannot do, in order that I may
learn how to do it.
-- Pablo Picasso
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