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Best Business Books: The Future

Changing Culture, Changing Cities, Changing Climate

(originally published by Booz & Company)

Yochai Benkler,
The Wealth of Networks: How Social Production Transforms Markets and Freedom
(Yale University Press, 2006)

Henry Jenkins,
Convergence Culture: Where Old and New Media Collide
(New York University Press, 2006)

Robert Neuwirth,
Shadow Cities: A Billion Squatters, A New Urban World
(Routledge, 2005)

AnnaLee Saxenian,
The New Argonauts: Regional Advantage in a Global Economy
(Harvard University Press, 2006)

Tim Flannery,
The Weather Makers: How Man Is Changing the Climate and What It Means for Life on Earth
(Atlantic Monthly Press, 2005)

One way to dial the fuzzy future into sharper focus is by scanning the present environment, then zooming in on the parts that appear to be undergoing significant change right now. This year’s books about the future do exactly that. Approach them as lenses, not as maps; rather than predict outcomes, they look closely at today’s shifting fault lines. The transformations these books examine lie at the heart of tomorrow’s big-picture issues: worsening global warming, sprawling squatter cities, atomizing media power, and emerging economic regions that feed as well as compete with Silicon Valley. Each of these developments points to a changing balance of power — between man and his environment, between the rich and the poor, between mainstream media and upstarts, and between the U.S. and India and China — that will reshape the ways we do business in the years to come.

Who’s in Control?
Such apparently unrelated phenomena as open source software, Wikipedia, political bloggers, citizen journalists, file-sharing networks, and radio spectrum regulation are all part of a single wave of change. Do-it-yourself (DIY) media — abetted by mobile phones, digital cameras, laptop computers, and broadband connectivity — have expanded well beyond early adopters and are changing the way people create and distribute cultural products. And the insurgent DIY media are, not surprisingly, at odds with the entrenched mainstream media. Yochai Benkler’s book The Wealth of Networks: How Social Production Transforms Markets and Freedom presents evidence that this conflict will determine whether today’s digital innovations lead to greater wealth and liberty for a wider variety of people and companies or to more highly concentrated power for a few centralized media providers.

“Information, knowledge, and culture are central to human freedom and human development,” Professor Benkler writes. “How they are produced and exchanged in our society affects the way we see the state of the world as it is and might be; who decides these questions; and how we, as societies and polities, come to understand what can and ought to be done. The change brought about by the networked information environment is deep. It is structural. It goes to the very foundations of how liberal markets and liberal democracies have coevolved for two centuries.”

Professor Benkler, who teaches at Yale Law School, argues that radically democratized access to the means of intellectual production and distribution made possible by cheap computers and the Web over the past two decades could change governments, science, economics, and intellectual life in the years to come. In particular, he claims that shifts in economic and social organization among online communities have produced fundamentally new kinds of institutions for creating culture and exchanging knowledge. He points to the rise of “nonmarket and nonproprietary” production by volunteers cooperating via the Internet on such projects as Linux and Wikipedia. The “peer production methods” behind these projects suggest that the individuals involved are neither strictly self-interested nor purely altruistic, but rather a mixture of both. Individuals decide for themselves how they want to contribute — which piece of the Linux infrastructure to work on, which Wikipedia pages to edit — a process that in turn leads to a form of self-organization with distributed control. Linux and Wikipedia thus “hint at the emergence of a new information environment, one in which individuals are free to take a more active role than was possible in the industrial information economy of the twentieth century.”

For Professor Benkler, peer production is the wellspring of all sorts of hope. Widespread participation in Linux and Wikipedia, he asserts, could foreshadow a renewed interest in government by the people. Further, such voluntary global collaboration has the power to act “as a mechanism to achieve improvements in human development everywhere” when it is applied to reduce the high costs of agricultural and pharmaceutical innovation for the developing world.

The benefits of enhanced power of individuals and coalitions in the political, economic, and cultural realms are not guaranteed, however. Professor Benkler explains how the traditional media are deploying legal and political tactics to protect themselves from losses in the face of technological disruption. He tells us why the movie, recording, software, chip, and computer industries want to build controls into digital media equipment that limit the power of users — without, by the way, doing much to curtail the problem of piracy. The real purpose: to recentralize the control of innovation and commercial use of digital technology.

The resulting battles raging over telecommunications, copyright law, and digital-rights management will determine “the institutional ecology of the digital environment,” says Professor Benkler, affecting not just what media people consume, but what forms of media people produce “as autonomous individuals, as citizens, and as participants in cultures and communities — to affect how we and others see the world as it is and as it might be.” Professor Benkler makes a compelling case that too much is at stake for us to sit back and let others — particularly those in the mainstream media who stand to lose so much — decide.

Although all the books in this year’s class of leading media titles tackle weighty issues — unchecked urban expansion, climate change — Professor Benkler’s manifesto turns a much-needed spotlight on issues of great scope and moment that deserve far more public attention than they’ve yet gotten. For that reason, we’ve chosen The Wealth of Networks as the best book about the future in 2006.

Henry Jenkins’s lighter if no less serious book on media opened my eyes to the way big corporations and amateur culture producers already work together. In Convergence Culture: Where Old and New Media Collide, he describes the active participation of media consumers in the creation of cultural products, and argues that top-down and bottom-up are not colliding, but rather merging — not always at the pleasure of the major media companies.

Rather than the passive, manipulated consumers that some critics of corporate media portray, Professor Jenkins sees a culture of consumers who manipulate and build on the entertainment that they purchase from major media companies. Invoking Pierre Lévy’s theories of “collective intelligence,” he describes, for example, how organized online fan communities mounted global intelligence campaigns to crack the secrets of the Survivor reality television series. This is familiar turf to Henry Jenkins, the DeFlorz Professor of Humanities and the founder/director of the Comparative Media Studies program at MIT, whose previous work Textual Poachers (Routledge, 1992) dealt with fan communities that had created unauthorized alternative scenarios — entire stories, books, even films — about their favorite characters on Star Trek or Star Wars. Such convergence is not without its conflict: When Warner Brothers tried to crack down on an unauthorized online version of the Daily Prophet, the newspaper featured in the Harry Potter series, they were overwhelmed by a successful global online protest organized by the Prophet’s creator and editor — 14-year-old Heather Lawver.

But some media companies have learned that there’s much to be gained from playing along with these self-generated fan communities. The most successful creators of online games realized that participants would pay for the opportunity to help create their own entertainment. In online multiplayer role-playing games like the Sims, EverQuest, and World of Warcraft, the publisher determines the characters’ traits and powers, but the conflicts and quests, the parties and battles, the communities that extend across media and into the physical world, the virtual economies in which players pay actual money for digital swords and other equipment, are organized and invented by the players themselves. Economists have estimated that the virtual economy of EverQuest alone is equivalent to that of Bulgaria. The extended social networking effects of playing these games with people who might be valuable social or business contacts in the physical world has led to the cliché that “World of Warcraft is the new golf.”

Just as Professor Benkler lays bare the structural changes that underlie online games, open source software, and Wikipedia, Professor Jenkins shows how today’s “mashups,” which combine and juxtapose samples from popular audiovisual works (so far, mostly illegally), have become an art form in their own right. The Web site, for example, combines real estate listings from with Google Maps to create an incredibly useful locator for available housing.

Professor Benkler pieces together Wikipedia, the blogosphere, the Howard Dean presidential campaign, and the open source community to trace the transformation of the power to persuade, inform, educate, and sell. Professor Jenkins pieces together fan fiction, cross-media entertainment franchises, online games, and, yes, the blogosphere and the Dean campaign to reveal how the emerging “participatory culture” helps these public and private interests coevolve even as they conflict. “The power of the grassroots media is that it diversifies; the power of broadcast media is that it amplifies. That’s why we should be concerned with the flow between the two: expanding the potentials for participation represents the greatest opportunity for cultural diversity. Throw away the powers of broadcasting and one has only cultural fragmentation,” he writes. “The power of participation comes not from destroying commercial culture but from writing over it, modding [modifying] it, amending it, expanding it, adding greater diversity of perspective, and then recirculating it, feeding it back into the mainstream media.”

As Professor Benkler and Professor Jenkins make clear, changes under way today are transforming the entertainment industry, the nature of education, the economics of intellectual property, journalism, scientific research, and the way democracies function. But the matter of who owns, controls, and benefits from these transformations will be decided by who wins political conflicts over technological power. Together, Professor Benkler and Professor Jenkins paint a broad and detailed picture of this obscure but all-important power struggle.

Squatter Megacities and Regional Technopolises
The cyberworld may have grown in importance in recent years, but the world where our bodies live will always have first claim on our attention. Thus, every one of us should contemplate the fact that Homo sapiens will soon become, for the first time in its history, mostly an urban species. In Shadow Cities: A Billion Squatters, A New Urban World, Robert Neuwirth examines the implications of that fact, along with the changes being wrought by the unbridled growth of squatter cities across the globe. At the same time, just as squatter cities are spreading everywhere, so are Silicon Valleys. Life in the middle of the 21st century is going to be heavily influenced by both phenomena. AnnaLee Saxenian, in The New Argonauts: Regional Advantage in a Global Economy, looks at the increasing influence and interconnections of expanding techno-economic regions from Shenzhen to San Jose. These two global trends are already triggering massive changes at both the highest and lowest economic strata.

Mr. Neuwirth, a journalist, lived for months at a time in the vast, bustling, and surprisingly entrepreneurial squatter cities of Rio de Janeiro, Nairobi, Istanbul, and Mumbai. The sheer scale and pace of the world Mr. Neuwirth describes are staggering: Every year, 70 million people leave their rural homes and migrate to cities. By 2030, there will likely be 2 billion squatters in the world. After reading Shadow Cities, you’ll think twice about ever again using the term slum — and you’ll definitely have a better idea of how the hundreds of millions of new city dwellers are coping with their poverty, and how their survival strategies will alter the world in the coming decades. (Also see “City Planet,” by Stewart Brand, s+b, Spring 2006.)

Mr. Neuwirth documents how those at the “bottom of the pyramid” have devised a variety of sophisticated and unregulated systems that make urban life work. “These squatters mix more concrete than any developer. They lay more brick than any government. They have created a huge hidden economy — an unofficial system of squatter landlords and squatter tenants, squatter merchants and squatter consumers, squatter builders and squatter laborers, squatter brokers and squatter investors, squatter teachers and squatter schoolkids, squatter beggars and squatter millionaires. Squatters are the largest builders of housing in the world — and they are creating the cities of tomorrow.”

There’s even a kind of extralegal respect for law and order. You take your life in your hands when you walk around much of Rio de Janeiro’s flatlands, but you need not fear muggers in the city’s huge hillside favelas, the squatter cities where about a fifth of Rio’s residents live. There, local drug gangs maintain law and order, making sure that the only crimes that occur are theirs. The people Mr. Neuwirth describes are not presented as raw statistics. They are his neighbors, his landlords, his friends. Mr. Neuwirth stresses the need to see the squatters’ nobility and desperation through gimlet eyes: “Not one government in existence is successfully building for the poorest of the poor. So the poorest of the poor are building for themselves. That may not fit into any great ideological category, and it is certainly illegal according to current law. But it is sensible, patriotic, and worthy of a true citizen.”

At the other end of the economic spectrum, AnnaLee Saxenian, dean of the School of Information at the University of California at Berkeley, has been studying the ways foreign-born, U.S.-trained technology entrepreneurs have returned to their home countries in recent years to create companies, industries, and entire industrial regions. Just as the emergence of Fairchild and Intel was only the beginning for Silicon Valley, Professor Saxenian thinks the appearance of Indian companies like Infosys and Chinese companies like Lenovo is just the beginning of the development of interconnected regional techno-economic hotspots. As with much of the rest of the globalizing economy, the new competitors to Silicon Valley are also its economic partners and intellectual heirs.

Professor Saxenian has a deep understanding of what makes Silicon Valley and its counterparts around the world thrive. Regional Advantage (Harvard University Press), her 1994 investigation into why Silicon Valley and companies like Sun Microsystems succeeded while denizens of Boston’s Route 128, such as Digital Equipment Corporation (DEC), failed, has become a business school classic. The importance of the circulation of minds, ideas, and ventures in a relatively fluid, continually changing, open system was central to Silicon Valley’s success. In The New Argonauts, Professor Saxenian takes her earlier analysis global. Her research has revealed similar dynamics at work in the world of engineers who came to Palo Alto from Taipei, Mumbai, and Tel Aviv, earned their degrees and worked their first jobs in the semiconductor, PC, or Internet-based industries, and are now putting their experience to work back at home, as entrepreneurs and investors.

The social, intellectual, and economic ties between these “new argonauts,” their mentors and peers in the U.S., and their colleagues and protégés in their mother countries are networked into a system far more complex, with far more cooperation and even sharing (alongside the traditional cutthroat competitions), than in previous eras. If Professor Saxenian is right, then Silicon Valley–style economic development can be good news for large populations in the developing world who would like to move up to a relatively decent standard of living, quite possibly en route to a good life (if you believe that a growing positive balance of trade, the availability of capital for entrepreneurial enterprise, and an expanding middle class collectively offer a bridge over the gulf between the rich and the poor). The good fortune of the previously impoverished might also bring good news as well as bad for the U.S. technology industry. As long as American higher education and entrepreneurial opportunities continue to draw intellectual immigrants, tomorrow’s economic development in China or India might also enrich American companies doing business in those countries. If nothing else, Professor Saxenian’s conclusions ought to make policymakers think twice about restricting the immigration of knowledge workers or allowing America’s institutions of higher education to deteriorate.

Talking about the Weather
Finally, there are the really large forces, the kind that can and often do overshadow even important media, economic, and political issues. Weather catastrophes have become a frequent fact of our lives, and every tsunami or hurricane whips up more passion in the debate over global warming. The last of this year’s selections, Tim Flannery’s The Weather Makers: How Man Is Changing the Climate and What It Means for Life on Earth, will help you see debates about climate science and energy policies in a new light.

Tim Flannery, a mammologist and paleontologist who serves as director of the South Australian Museum and professor at the University of Adelaide, started out as a skeptic about global warming. His book explains in scientific but understandable, even eloquent, terms what made him change his mind. Professor Flannery does an entertaining job of quickly sketching out a big picture and a long view. An understanding of the radical danger of sudden atmospheric temperature change requires knowledge of how Earth came to support life, why the ocean is so important, and why humans burning fossil fuels for the past couple of centuries may have unwittingly triggered an irreversible change in an environment that supports 6 billion people.

The good news, if there is any, is that nobody knows for certain whether these climatic changes have caused irreversible damage. Professor Flannery acquaints us with the evidence that we know exactly how much carbon we are putting into the atmosphere and that we can curtail its emission enough to avoid further damage. That’s where science becomes a political issue. Although a few diehards will continue to argue that the science doesn’t prove the existence of global warming — and Professor Flannery introduces the fundamental research so you can judge for yourself — the important arguments from this point onward focus on what we are going to do about it.

The solution he supports is dramatic: First, reach an international agreement to cap carbon emissions at a level where civilization might not be severely disrupted by climate change. Next, estimate how quickly emissions need to be cut back. Finally, divide the resulting “carbon budget” by the number of people in the world and allocate emission limits to nations according to the size of their populations. This course will require a degree of international cooperation we haven’t come close to achieving. Just look at the failure of the Kyoto Protocol to reduce greenhouse gases.

What Professor Flannery makes perfectly clear is that we’re heading down a dangerous road, but we can and must do something about it. Weather has shown its terrible power to make our other concerns seem trivial. It’s hard to worry about cultural production or urbanization when you are faced with the devastation of superstorms and tsunamis.

Author profile:

Howard Rheingold (, author of Tools for Thought (Simon & Schuster, 1985), The Virtual Community (Addison-Wesley, 1993), and Smart Mobs (Perseus, 2002), coined the terms virtual community and smart mobs to describe the social phenomena that have emerged via the Internet and mobile telephony. He teaches digital journalism at Stanford and participatory media at the University of California, Berkeley, and is a fellow at the Annenberg Center for Communication. 

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