More On Real Time News: Abundance, Scarcity, And The Future Of Media Economics

Economies are not defined by money, per se, but by the exchange of goods and services that make them up. Currencies are a way of keeping score, a measure of indebtedness, since money stands as an implicit obligation that others owe: to exchange goods and services when offered currency.

Last night, a fight broke out on Twitter between Jeff Jarvis and Tim O’Brien (see /Message: Jeff Jarvis and Tim O’Brien Arguing About Real Time), which never came to a real conclusion, but rather, just petered out when the antagonists got sleepy.

I got sleepy too, and never clarified a few thoughts of my own.

O’Brien was adamant that Jarvis was selling foo-foo dust by claiming that the new ‘link journalism’ — which I think of as one aspect of real-time news — is part of a new ‘economy’. Jarvis stated that the links being streamed around are a form of currency, and this use of the term currency set O’Brien off, since he is an business journalist and has a deeply established notion of what a currency is.

For my own sake, let me riffle through some thoughts to help cast some light on this discussion.

Economies are not defined by money, per se, but by the exchange of goods and services that make them up. Currencies are a way of keeping score, a measure of indebtedness, since money stands as an implicit obligation that others owe: to exchange goods and services when offered currency. It’s a form of potential energy, to use a physics metaphor. If I want a bowl of soup I don’t have to chop kindling for an hour, since I can pull a ten spot out of my pocket and pay cash on the barrel head.

Other sorts of currency have been widely used: commodities, like wheat or acorns. Minted coinage was first invented as a token for a fixed amount of a food commodity. And once tokens are introduced, they take on a life of their own, since they can be a representation of all sorts of things: land, labor hours, or ownership in ventures.

So, O’Brien was right when he argued that links aren’t a currency, in a formal sense. In economies based on scarcity, currency is hard to come by, and as things get worse, money gets harder to find. People have to borrow money, at some interest, and then pay it back with this premium, often just to stay afloat. Even those borrowing to take on some new venture that is successful still have to pay back their investors. These factors mean that growth comes at the cost of some basic interest rate, and as a result money is slowly decreasing in value relative to its buying power.

At any rate, links can’t be a currency in a scarcity economy: there are too many of them, and they seem to be freely given, not exchanged, right?

Until they understand that the Web exists as it does, in the shape that it does, because people want more than they were offered before, then O’Brien’s NY Times and the other print media companies won’t turn the corner on this.

Link journalism and the movement toward a more real-time basis for news is part of the drive chain in the new media engine. But it is just as interesting to consider the city that this new vehicle is driving through, what the people are doing, what they are talking about, in that bright new city on the hill.

But there are other economies based on abundance, not scarcity. In so-called gift economies, goods and services are distributed in a sort of reciprocal altruism. Those that have the most give to others, without an explicit agreement for a return in the future. These societies are bound together by a different ethos in which social standing conferred by giving has great importance, rather than ownership of property or money.

The Web is the frontier between many social forces.

Much of what has made the Web the most valuable human artifact ever created is extra-market, or gift economy, in origin. The millions of contributors to open source software, blogs, Wikipedia, Twitter, and Amazon book reviews have not been principally motivated by direct financial incentives. They are doing it for extra-financial reasons, in general. While many bloggers would be happy to accept more money for their efforts, for example, they blog on without it, anyway.

So sharing links seems to be more like gifts given, a way to create social cohesion and a network of obligations in which social standing is conferred. But that is an economy. It’s just not based on commodities and scarcity.

[This is why the Washington Post’s Ira Shapira’s complaints about Gawker using his research on a “Generational Consultant” seemed so tin-eared to me and others: he was tallying up the hours he spent interviewing and transcribing. It’s that the measure of value? How many pencil shavings were involved? Isn’t the traffic he got from Gawker, the possible increase in his standing in the world, more important than that? Honestly, to a long time blogger, his concerns seem like whining, like he has something coming to him because he is writing for WaPo.]

At the same time, we have a lot of players on the Web whose primary motivation is the making of money, and many are doing just that, like Google, TechCrunch, HuffPo, and to a lesser extent, old media companies hoping to revive their fortunes online.

Even if a media company wants to keep its old scarcity-based economic principles unmodified, and simply do journalism online in exchange for a revenue stream, they have to understand the profound differences in the motivations and aspirations of people, online.

People who spend time on the web have adopted a mixed economic sentiment, that is — depending on the individual — some part scarcity economics, some part abundance economics — in which both hard and soft currencies play. And there is a lot more going on in the Web, and the world, than just media. My sense is that you can’t look at media as an economy of its own: it isn’t. It is one element, or sector, of the world (or Web) economy, one which is under the pressures of rapid revaluation.

It’s a mess, chaotic in every dimension. People’s values are shifting, traditional modes of expression and communication are changing, the world’s economy is in turmoil. It would be surprising if even the largest giants of the media world could find a safe path from a well-mapped past into an unmapped future.

But the key to the future frontier is not really a map of the territory, but understanding the people that live there: how they are using the new Web to explore and understand the world and each other, and how they are finding ways to create value and connection.

An argument about economics that reduces people to uniform and undifferentiated consumers of newsfeed is unilluminating, even when media companies might want desperately to hold to that world view. Until they understand that the Web exists as it does, in the shape that it does, because people want more than they were offered before, then O’Brien’s NY Times and the other print media companies won’t turn the corner on this.

Link journalism and the movement toward a more real-time basis for news is part of the drive chain in the new media engine. But it is just as interesting to consider the city that this new vehicle is driving through, what the people are doing, what they are talking about, in that bright new city on the hill.