Wikinomics Book Review

wikinomics book review
Wikinomics: How Mass Collaboration Changes Everything, by Don Tapscott and Anthony D. Williams, provides an excellent overview of the technologies and trends that are so disruptive in the Web 2.0 world. While traveling today to the Frost & Sullivan Sales & Marketing East Executive MindXChange, I had the opportunity to listen to the first couple of chapters of the Audible.com unabridged audiobook version of Wikinomics.

I had previously listened to the whole book on one weekend when I had lots of yard work to do. The upside of audiobooks is you can listen to them while you’re doing something else. The downside is it’s hard to take notes when you’re holding a power washer, so it takes a second listen to get maximum benefit. But at least you know where the highlights are.

Let me share a few.

The Wikinomics authors, who also maintain a companion blog and wiki, see four great trends shaping the 21st century landscape:

Openness – As exemplified by Rob McEwen, the CEO of the gold mining company Goldcorp, who made his company’s geologic data available to the world to get bright people from outside his company to help find more gold deposits on company property. By providing the data and $575,000 in prize money, he enlisted more than 1,000 virtual prospectors, who helped find targets that yielded 8 million ounces of gold, turning his company from a $100 million business to $9 billion concern.

Peer production, or Peering – Getting masses of individuals to collaborate openly, as exemplified by Wikipedia. The Apache server and the Linux operating system are among the other varied examples of peer production the authors cite.

Frankly, Tapscott and Williams are too deferential to laments from Bill Gates and others that peer production eliminates the profit-making opportunity for businesses and other purveyors of intellectual property. The answer to that (and the authors should have been stronger about this) is: SO WHAT? (Please forgive my shouting.) There may be economic disruptions and dislocations if open-source software like Linux or Apache displaces proprietary software like Windows, but people like Gates with entrenched interests forget that the ability to make money isn’t a divinely ordained right or the ultimate societal good. What matters to users of software or services is the cost of a product or service and its value.

Businesses exist for their customers, not vice versa. If someone (or an organized group of volunteers, as in Wikipedia) provides a service for free that was previously expensive, that’s a good thing. People can then spend their money to buy other services, so they get the formerly expensive product plus something else, as the societal bonus of Wikinomics.

When the Berlin Wall fell, political leaders and journalists talked about the “Peace Dividend“: if we as a society didn’t have to spend as much money on defense, we could spend it on other good things.

The same is true today. For example, craigslist is a great service for its users, enabling them to place free classified ads (in many communities) for everything from rentals to job postings to personals to items for sale, such as theatre tickets. It’s terribly disruptive for newspapers, which formerly milked the cash cow of classified advertising.

Does it hurt newspapers? Certainly. Is that a problem? If you own or work for a newspaper. Will western civilization crumble because of it? Hardly. Instead of paying several thousand dollars for a job posting classified ad in the newspaper, companies can post to Monster.com for a few hundred dollars, or craigslist for free. The companies can then invest the savings in other areas important to their growth.

That’s the “Wikinomics Dividend.”

The other two trends the authors examine are Sharing and Acting Globally. But instead of discussing them in a post that’s already too long, let me suggest that you get the book yourself.

The key value of Wikinomics is in providing broad trend overviews. The examples used, from Flickr to YouTube to MySpace aren’t the main point. Future competitors may one day render these irrelevant, too.

If you’re looking for the latest new thing, Wikinomics isn’t the place to find it; it is, after all, an old-media tree-killing production. But Wikinomics does give the theoretical framework upon which to build your understanding of changes in today’s economy.

44 More Leave Star Tribune Newsroom

The Minneapolis Star Tribune announced today a force reduction of 44 in its newsroom, mostly through voluntary buyouts, which comes on the heels of 24 who left three months ago:

Another round of goodbyes — the second in three months — began at the Star Tribune on Tuesday as the paper prepared to send 44 newsroom employees out the door with buyouts, most of them voluntary.
Longtime reporters, a photographer, editors and support staff who covered some of the state’s biggest stories during the past three decades said they were leaving to retire, go online or write elsewhere.

“I remember when I was in my late 20s I was impatient for people in their late 50s to get the hell out of the way,” said reporter Chuck Haga, among the people who will leave the paper June 15. “So now I’m getting the hell out of the way for youngsters.”

Except there aren’t any youngsters being hired to take his place. This is a straight reduction.

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Mayo Clinic for Horses?

Now I’ve seen everything.

Tuesday’s Seattle Post-Intelligencer has a special report under the headline “At Pegasus, Mayo Clinic for Thoroughbreds Meets the Four Seasons,” with this as the lead:

REDMOND — The sign on the iron gate at the end of 260th Place Northeast spells P-E-G-A-S-U-S in such a way that a visitor concludes that what’s to come is something special.

Special, indeed.

Pass through the gate and what comes into view on about 100 well-groomed acres on a bluff above the Snoqualmie River Valley and the town of Carnation is a complex — the Pegasus Equine Rehabilitation and Training Center — that has to be the equine equivalent of the Mayo Clinic augmented by five-star luxury.

I’m glad I work at the Mayo Clinic for people, and that at least the P-I also runs our syndicated Medical Edge newspaper column, which is offered through Tribune Media Services.

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Star Tribulation

The Star Tribune of the Twin Cities today announced its second round of layoffs this year (the first was in March).

Bowing to the pressures of declining circulation and falling revenue, the Star Tribune Monday announced a sweeping program of buyouts across the company that will send 145 employees out the door, either through buyouts or, if enough people don’t volunteer, layoffs.
The cuts represent 7 percent of the company’s 2,100 positions and include 50 positions out of 383 people in the newsroom and editorial departments.

Publisher Par Ridder delivered the news in a company-wide meeting in which he laid out the increasingly bleak fortunes for daily metro newspapers. The company’s annual advertising and circulation revenue has fallen by $64 million over the last three years. Classified advertising was down 23 percent in the first quarter over last year. If current trends continue, Ridder said, the paper would begin to lose money in a year to 18 months.

The full article goes into considerable detail on the financial problems facing the paper, which was sold late last year for less than half of what McClatchy had paid for it.

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Same Song, Same Verse

Circulation numbers continue to get worse.

Newspaper sales continue a steep slide nationally, figures released Monday show, but two New York City tabloids continued to buck the trend, posting the largest gains among major papers.

The industry as a whole reported a 2.1 percent drop in weekday circulation, and 3.1 percent on Sundays, in the six months ended March 31, compared with the period a year earlier. The figures, compiled by the Audit Bureau of Circulations but not yet audited, reflect 745 of the nation’s more than 1,400 daily newspapers.

The figures follow first-quarter reports for the nation’s major newspaper companies that showed falling earnings, declines in advertising and plans for continued staff cuts, heightening fears about the future of newspapers. Circulation figures have dropped gradually for two decades, beginning in the 1980s, but since 2004, the decline has picked up speed as readers and advertisers have migrated to the Internet.

It’s interesting that the Times places itself among those that “held fairly steady”…even though the other two in the group had slight gains while the Times’ decline was slightly worse than the industry average on Sundays, and modestly better than average on weekdays.

Sales have held fairly steady in recent years at the nation’s three largest-circulation newspapers, USA Today (more than 2.2 million), The Wall Street Journal (more than 2 million) and The New York Times (more than 1.1 million). In the most recent period, USA Today and The Journal, which do not print Sunday issues, posted fractional gains, while The Times’s circulation dropped 1.9 percent on weekdays and 3.4 percent on Sundays.

The Los Angeles Times, roiled by internal dissension, leadership turnover and a recent deal by its owner, the Tribune Company, to take the company private, lost 4.2 percent of its weekday sales, and 4.7 percent on Sundays. The Times’s weekday circulation averaged 815,000, almost 300,000 below where it stood seven years earlier.

I guess compared to the LA Times, the NY Times can take some comfort.

Or, as a famous Minnesotan would sing, “The Times, they are a changin'”

My wireless router burned out last week, and I’m just now back on-line at home, so I’m a few days late with this one. Happy to be back.

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