We’re on the verge of an historic achievement–and we are also on the verge of throwing it all away.
One of the benefits of the Internet bubble was that everyone felt they had to get on the Web — in a hurry. And so we dumped a few billion pages of information on HTTP servers in the only format we had (humble HTML) and cast our fate to the winds. A lot of what we did was badly done, but we did it, and people started using it.
Over time, people started linking to and illuminating that information with a complex network of web pages. Finally, all those threads are woven together by the search engines–especially Google which extracts as much information from the links as from the pages.
But this tapestry is full of holes, and the holes are growing.
It’s beyond dispute that the value of the Net as a whole is greater if the information on it is available freely to all. It’s less clear whether individual publishers will be better off if they give their information away to the Web community.
The value of this information has never been really unlocked. Most of it is stored in large databases like Lexis Nexis and Dialog, where skilled researchers pay $120 per hour to massage it. It’s a surprisingly small business, only a couple billion dollars a year. It’s a lot smaller than, say, the Internet advertising business.
Imagine the value that would be created if this resource were unlocked and freely accessible and linkable. But we seem to be moving in the opposite direction.
Publishers, justifiably concerned about the optimizing their shareholders’ return, are beginning to turn to a new wave of technologies and business models to increase the value of their own business at the expense of the Net.
They’re moving more of their information into proprietary databases, charging subscriptions for access to their web sites, and –this quarter– flirting with proprietary data formats.
It’s beyond belief that any publisher would trust their livelihood to Microsoft’s good intentions at this late stage. Or Adobe’s for that matter. Or even smaller companies. All these companies are promoting formats for future electronic publications that are designed to make them more like print — unlinkable, uncopyable, unsharable. But also indecipherable without reader software.
But why put your product in formats controlled by companies that have demonstrated their intention to extract increasing rents from their vassals? Why wouldn’t you use formats that are not only more powerful, flexible, and future proof — but are also free for the taking?
These moves on the part of publishers are mostly boneheaded and self-defeating. But they can do a lot of damage in the short run, or even the long-run, if the right publishers make the wrong moves for too long.
Anyone in an organization considering such a format should be asking pointed questions about the long-term licenses being granted by the format owners and the caps on any license fees. And what these promises will mean when the format, or the reader software, or the platform is upgraded.
You should also consider the effect of the kind of forced-upgrade policies that Microsoft implementing now for their operating system and applications software. It’s doubtful Microsoft or Adobe will make any promises about future fees, but you should ask yourself what those promises are really worth.
Microsoft sees owning your software as a license to extract rents from you in perpetuity. And the only limits on those rents is what the market (collectively) will bear. It’s also important to understand than any sane software company (Adobe, for example) will do exactly the same thing if given the same position.
[Thanks to They Might Be Giants for the quote in the headline]