Friday, May 21, 2004
Twilight of the Information Middlemen
A lot of my doctoral work has focussed on how middlemen profit from exploiting information asymmetries. Though most of my work has focussed on under-developed rural markets, I have been equally interested in the impact of the Internet on information intermediaries at a different end of the market. James Fallows has his own take on why it is harder to put an exact price on intellectual or creative effort than on, say, a bushel of wheat. He also has an interesting take on the blogging phenomenon.
Information is both invaluable and impossible to value. Historically, the main way around this problem has been to pack the results of intellectual or creative effort into something tangible that can be priced and sold: a book, a seat in a theater, an hour of an expert's time. Technology causes economic chaos when it disrupts this packaging plan, as is now happening in the music industry.
At the democratic extreme, blogs are a nightmare vision of a publishing house's "slush pile'' come to life. At the elite end, the dozen or so best-known sites, they are an intensified version of insider journalism. If you don't get quite enough sass, attitude or instant conclusions from the rest of the news media, you can always find more at the leading blogs. But in between are thousands of sites that offer real-time eyewitness testimony from people doing almost anything that some other person might find interesting: training as a surgeon, looking for oil in Siberia, fighting in Iraq.
If blogs represent the uncoordinated efforts of countless volunteer writers, another information explosion shows the institutional might of the state. Taxpayer money still is behind a surprising amount of crucial data: nearly all weather observations and the supercomputer-based models that create forecasts; most basic scientific research; most research into disease causes and cures. In principle, this publicly financed knowledge has always been the public's property, but until a few years ago there was no easy way to get it from research centers to a wide audience. Thus various middlemen arose - notably scientific journals, which did the expensive work of printing and distributing research papers in return for steep subscription costs.
With the coming of the Internet, these intermediaries were no longer technically necessary - but, like the big music companies, they won't just fade away. So, on several governmental fronts, a quiet but intense struggle for survival is raging. Four years ago, as head of the National Institutes of Health, Dr. Harold Varmus proposed the creation of PubMed Central as a publicly accessible repository of medical research articles. Other "open access" scientific databases have been created, but they are meeting resistance from journals and authors who traditionally have held copyrights.
Information is both invaluable and impossible to value. Historically, the main way around this problem has been to pack the results of intellectual or creative effort into something tangible that can be priced and sold: a book, a seat in a theater, an hour of an expert's time. Technology causes economic chaos when it disrupts this packaging plan, as is now happening in the music industry.
At the democratic extreme, blogs are a nightmare vision of a publishing house's "slush pile'' come to life. At the elite end, the dozen or so best-known sites, they are an intensified version of insider journalism. If you don't get quite enough sass, attitude or instant conclusions from the rest of the news media, you can always find more at the leading blogs. But in between are thousands of sites that offer real-time eyewitness testimony from people doing almost anything that some other person might find interesting: training as a surgeon, looking for oil in Siberia, fighting in Iraq.
If blogs represent the uncoordinated efforts of countless volunteer writers, another information explosion shows the institutional might of the state. Taxpayer money still is behind a surprising amount of crucial data: nearly all weather observations and the supercomputer-based models that create forecasts; most basic scientific research; most research into disease causes and cures. In principle, this publicly financed knowledge has always been the public's property, but until a few years ago there was no easy way to get it from research centers to a wide audience. Thus various middlemen arose - notably scientific journals, which did the expensive work of printing and distributing research papers in return for steep subscription costs.
With the coming of the Internet, these intermediaries were no longer technically necessary - but, like the big music companies, they won't just fade away. So, on several governmental fronts, a quiet but intense struggle for survival is raging. Four years ago, as head of the National Institutes of Health, Dr. Harold Varmus proposed the creation of PubMed Central as a publicly accessible repository of medical research articles. Other "open access" scientific databases have been created, but they are meeting resistance from journals and authors who traditionally have held copyrights.
