Pirates, Prophets and Pioneers: Business and Politics Along the Technological Frontier

357 Pages·2015·2.02 MB·English

by  Spar

Contents
About the Book
About the Author
Title Page
Dedication
Acknowledgements
Prologue: The View from Partenia
Chapter 1. The First Wave
Chapter 2. The Codemakers
Chapter 3. Radio Days
Chapter 4. BskyB and the New Wave of Television
Chapter 5. Last Stand of the Cypherpunks
Chapter 6. Trusting Microsoft
Chapter 7. Space Music
Chapter 8. Surfing the Barbary Coast
Selected Bibliography
Index
Copyright
ABOUT THE BOOK
The advance of digital technology is creating whole new markets and industries.
Telecommunications is merging into media; information is blurring into
entertainment; and commercial ventures of all types are being pulled into the
amorphous space of the internet. Pirates, Prophets and Pioneers examines how
these new technologies are pushing at the boundaries of existing rules, and how
governments are likely to respond to them. Using material gathered from four
years of academic research and confidential interviews, Debora Spar brings us
inside the world of business and politics in the digital age. In the process, she
also takes us back in time, to explore to older technologies and earlier battles.
Looking at the advent of radio and telegraphy, the rise of trans-oceanic trade and
the development of satellite television, Spar finds striking parallels to our own
time (for example, online music and software wars) and critical lessons for both
business and politics.
ABOUT THE AUTHOR
Debora Spar is a Professor at Harvard Business School and regularly lectures on
the topics of this book to top-level managers at companies such as IBM, Abbott
Laboratories, the World Bank and General Electric. She has spent the last eight
years teaching the politics of international business to MBA candidates and
corporate audiences. She is also author of The Cooperative Edge (Cornell
University Press, 1994).
Pirates, Prophets and Pioneers
Debora Spar
Dedicated to Ray Vernon
(1913–1999)
Who would have hated anything too sentimental …
ACKNOWLEDGEMENTS
In a book that spans seven centuries and a dozen technologies, it seems only
natural that the author’s gratitude should be similarly expansive. And indeed it
is. Scores of people have helped me with the research required for this book;
with the intellectual framework that sustains it; with the funding that was so
critical; and with generous doses of enthusiasm and support. I am grateful to
them all.
At Harvard, many of my colleagues read successive drafts of the manuscript
and added their wisdom to it. I deeply appreciate the efforts of Rawi Abdelal,
Sven Beckert, Alexander Dyck, Walter Friedman, Geoffrey Jones, Rosabeth
Moss Kanter, Thomas McCraw, Julio Rotemberg, Richard Tedlow, Richard
Vietor, Louis Wells and David Yoffie. Dick Rosenbloom was particularly
helpful in clarifying my work on the radio and telegraph industries; and Tony
Oettinger and Harry Lewis provided masterful help with the intricacies of
software and computing. Kalypso Nicolaidis of Oxford University helped me
struggle through the articulation of the book’s overall formulation, as did Jessica
Korn of the Gallup Management Journal. Stephen Barden, Len Schoppa,
Christopher Marsden and Gordon Silverstein each intervened at critical points in
the book’s journey, and Allegra Young and Terence Mulligan plowed through
final versions of the chapters. Along the way, the book also benefited from a
long and illustrious stream of research assistants: Jennifer Burns, Joshua
Friedman, Larry Hamlet, Brianna Huntsberger, Lane LaMure, and Elizabeth
Stein. Laura Bures was invaluable in the earliest stages, compiling a
monumental survey of piracy and serving as an ever-patient sounding board.
Michelle Neve did a wonderful job of handling all administrative details and
Christopher Albanese advised on matters both technical and musical.
I am also grateful to Mari Sako and her colleagues at Oxford University for
offering me a congenial atmosphere in which to write during the spring of 2000;
and to Prof. Dr. Friedhelm Neidhardt and Dr. Georg Thurn at the
Wissenschaftszentrum Berlin for providing a similarly conducive arrangement in
the fall. Throughout, research funding for this project was generously provided
by the Division of Research at Harvard Business School.
As usual, though, my greatest debts lie closest to home. My sons, Daniel and
Andrew Catomeris, have essentially grown up with this book and helped to
make it fun. They found me pictures of satellites and conquistadores; kept my
music current; and listened eagerly to pirate tales. My husband Miltos was a joy
and a comfort throughout. And Maria Araujo and Irene Saavedra took care of all
the other things while I was busy writing.
Finally, many of the most important contributors to this book are not
mentioned here. They are the true pioneers of our era – the men and women
working along the technological frontier and helping, in some cases, to rein it in.
To protect their confidentiality, I am not mentioning these people by name. But I
am grateful to all of them and thankful for their time. I hope that this book
captures some of their frontier spirit and helps to establish these pirates, prophets
and pioneers along technology’s arc.
D.L.S. Cambridge, June 2001
PROLOGUE
THE VIEW FROM PARTENIA
PARTENIA IS A lonely place. Strewn across the sands of the Sahara, it is formally
located in Tunisia, or Algeria, or Libya, depending on whom you talk to or
which way the winds are blowing. It is an ancient place, Partenia, remnant of a
world that hardly anyone can even remember. Yet in a very strange way Partenia
is coming back.
In 1995, the Vatican dismissed an outspoken French bishop named Jacques
Gaillot. Arguing that Gaillot had been far too liberal for the Church’s doctrine,
Vatican officials removed him from his diocese outside Paris and sent him
instead to Partenia. Clearly it was a symbolic move, for the Church never
expected Gaillot to preach to the empty drifts of the Sahara. They simply wanted
to defrock him gently, pushing the unruly bishop to one of the several
jurisdictions reserved for retired, or ageing, or unwanted priests. Gaillot,
however, wasn’t prepared to go quietly, or to renounce the liberal views that had
angered his superiors in Rome. So he went to Partenia – virtually.
One year after his dismissal, Gaillot launched the world’s first ‘virtual
diocese’. Named Partenia, it is a site for liberal Catholics, a ‘place of freedom’,
according to Gaillot, where Catholics can discuss the issues that Gaillot had
come to stand for: the problem of homelessness, the spread of AIDS, the evils of
nuclear testing and the wisdom of married priests. In the first six weeks of 1996,
Partenia registered 250,000 hits. The Vatican, presumably, was not impressed
with Gaillot’s move and spent a good deal of time trying to concoct a strategy
for dealing with this unsettling cyber-priest. But there really wasn’t much that
they could do. So they left Gaillot and his liberal site alone. Partenia had won.
In cyberspace, Partenia is everywhere. Dotted about the Internet’s web are
thousands – millions – of places where rebels like Bishop Gaillot reside. There
are pornography sites accessible to strait-laced Singaporeans, Liberian gambling
dens, and secluded banking services run from the tiny island of Anguilla. There
are networks of Burmese dissidents, collecting information on the dictatorial
regime in Rangoon and emailing it to thousands of supporters around the world.
There are bootleg copies of academic papers and Snoop Doggy Dogg’s latest
hits. In cyberspace, even sombre corporations indulge their rebel side, slipping
around the real-world laws that govern things such as export controls or truth in
advertising.
If we look at cyberspace from the viewpoint of Partenia, then, it looks very much
like a frontier town – like California of the 1890s, for example, or the Indies that
Europe scrambled to in the seventeenth century. There are the usual hordes of
rebels and rogues, plus scores of pioneers and gold-diggers, each scrambling to
carve out new territories and stake their claims in them. There are people like
Marc Andreessen and Jerry Yang (the respective founders of Netscape and
Yahoo!) who ventured West to test their mettle and made incredible fortunes
virtually overnight. There are prophets who scream of a brave new world and
travelling salesmen hawking IPOs instead of snake oil. (The connection, of
course, may not be that distant.) As in any good frontier, there are not a lot of
rules or marshals in town, so justice is rough and the winners grab whatever they
can. There are, to be sure, some remote authorities (the U.S. Federal
Communications Commission, the European Commission’s DG IV) who claim
to be patrolling the area, but everyone knows that their guns are not loaded. For
cyberspace, it seems, is a lawless realm, a place where unruly bishops can
confound the Pope and Jerry Yang can start a multibillion-dollar industry before
turning thirty.
This sense of anarchy permeates the furthest reaches of the Net. In Silicon
Valley, along Route 128 and in the samizdat cafes of Beijing and Rangoon, there
is a palpable sense of excitement; a prevailing belief that authority is dead and
that digital technologies have killed it. And to some extent this is true. Digital
technologies have created a revolution of sorts. They have allowed entrepreneurs
to build empires out of fibre and thin air and to establish these empires in a realm
without rules. They have challenged governments and their traditional authority
– not by design or intent, but purely as a result of technological accident.
Because digital technologies allow information to flow seamlessly and invisibly
across national borders, they make it very difficult for governments to do many
of the things to which they have grown accustomed. Governments can’t patrol
their physical territories in cyberspace; they can’t easily enforce property rights
over ephemeral ideas and rapidly moving bits; they can’t control information
flows; they may not even be able to collect taxes. Such is the nature of politics
along the technological frontier.