The Zero Marginal Cost Society: The Internet of Things, the Collaborative Commons, and the Eclipse of Capitalism (22 page)

To understand the speed at which this change is going to take place, we need to step back for a moment and look at Zuckerberg’s law, named after Mark Zuckerberg, founder of Facebook. Zuckerberg has discovered an exponential curve in social media, not unlike Moore’s discovery in computing power and Swanson’s discovery in solar technology. Using data assembled internally on Facebook, Zuckerburg shows that the amount of information shared on the Web has been doubling every year and he predicts that the doubling process will continue for the foreseeable future. The proliferation of cheap computers and mobile devices makes it easier to share every moment of our daily lives with one another through social media. For example, Spotify, a music-streaming service, can automatically post every song you listen to on Facebook. In the first few months of its introduction, 1.5 billion “listens” were shared through Spotify and other apps. Apple now has an iPhone feature called Find My Friends, which allows Apple to track an individual’s location and share it with others in their network.
29
Similar apps are now being created to allow people to co-generate and share green electricity across an Energy Internet.

The Cleanweb Movement is hosting weekend hackathons all over the world. These events bring together software developers, social entrepreneurs, and environmental activists in deep collaboration to create apps that will allow hundreds of millions of people to become players on the Energy Internet. Prizes are awarded to the developers of the best apps.

At the New York Clean Web Hackathon, several hundred developers broke up into 15 teams and, after 28 intensive hours, came up with inventive new apps for using Internet technology to manage green energy. The winner of the New York Hackathon was a group called Econofly. Their website allows consumers to compare appliances by their energy efficiency ratings. Another winner, Parkifi, is an app that helps users locate a New
York park with a Wi-Fi hotspot. A third winner, nycbldgs.com, uses energy data created by the city of New York to put together a map of all the municipal buildings, ranking them on energy usage and carbon dioxide (CO
2
) emissions. The goal is to identify buildings that can be retrofitted and converted to micropower plants and feature “best in show” buildings that can highlight state-of-the-art green design and energy efficiencies.
30

The idea behind the Cleanweb Movement is to use IT, the Internet, and social media to cluster like-minded people together to create lateral economies of scale in the implementation of energy efficiencies and the introduction of renewable-energy harvesting technology. This means simplifying the process of gathering information on energy efficiencies and making it easier and cheaper to invest in renewable-energy technologies.

Mosaic is a Cleanweb company that uses Web-based crowdfunding to install solar panels on roofs. Much of the cost in financing renewable energy, interestingly enough, is not in the solar panels themselves—they’re getting cheaper and cheaper—but in the “soft costs,” which include customer prospecting, site evaluations, and financing. In the United States, solar companies spend approximately $2,500 to acquire each new customer. It is estimated that IT solutions—using social media—could drive the cost of solar down by 75 percent, making it cheaper than coal.
31

The Cleanweb Movement in the United States is getting Big Data help from a new federal government initiative called Green Button. The program, which was launched in 2011, encourages power and utility companies to voluntarily provide easy access to real-time energy usage data now available for the first time because of the installation of millions of smart meters in homes and businesses. Smart meters are vital data collection points in the Energy Internet infrastructure. That data can be downloaded by the companies’ customers so they can have the information they need to more efficiently manage their energy use. In less than a year, the number of customers with instant access to their own energy use data ballooned to 31 million.
32

Companies like Opower, Itron, First Fuel, Efficiency 2.0, EcoDog, Belkin, and Honest Buildings are scurrying to develop new applications and Web services that can use Green Button data to empower users to take control of their own energy future.
33

This wealth of data on individual energy usage is now being leveraged through social media. Studies show that money is often not the critical factor in moving people to change their energy lifestyle. Instead, researchers have found that altering one’s energy profile is more often stimulated by the desire to cooperate in a shared commitment to sustainable living and by a sense of collective empowerment.

Being able to share one’s energy data on social media is a powerful way to begin a peer-to-peer conversation about new ways to manage energy. Sharing energy tips, alerting each other to new apps to increase energy efficiency, clustering together in energy cooperatives to install renewable
energy more cheaply, or just taking pleasure in a little friendly competition greatly strengthens the global community of sustainability activists.

Facebook launched the “Social Energy App” in 2012 in cooperation with the Natural Resources Defense Council (NRDC), Opower, and 16 utility companies. Participants can sign up on the Green On Facebook energy app or on Opower’s website. The app uses data from your energy bill to show how your home ranks against similar homes across America as well as the homes of your Facebook friends. Participants can compete with others to increase their energy efficiency and reduce their energy use and set up groups interested in exploring various green energy initiatives. The social energy app also provides tips and a platform for all the participants to share energy advice. Facebook’s Mary Scott Lynn, who leads the company’s sustainability programs, remarked that “the app is intended to make saving energy social and creates a conversation about the merits of energy efficiency that doesn’t currently happen.” Lynn believes that “adding the social aspect of environmental action could be the missing piece to previous attempts to create an online community on energy.”
34

By bringing together IT, the Internet, mobile communications, and social media with renewable energy, the Cleanweb Movement has created a powerful mix. One pioneer of the new movement touched on the implications of the convergence of Internet communication with renewable energy. “Think of the Cleanweb as what happens when green energy meets Moore’s Law,” says Dominic Basulto. Writing on the blog
Big Think
, he observed that social entrepreneurs who

once viewed “clean tech” and “the Web” as an either/or investment proposition now have the best of both worlds: they can invest in solar companies at the same time as they are investing in the future of Web or mobile. If Silicon Valley can get the Cleanweb to scale in the same way that raw computing power has scaled over the past two decades, just think of the possibilities.
35

Free Wi-Fi for Everyone

The prospect of prosumers financing the generation of their own green energy and overseeing its use and distribution with their own wireless devices at near zero marginal cost has come a step closer to reality with the recent recommendation of free Wi-Fi for everyone. In February 2013, the Federal Communications Commission (FCC), the oversight body that regulates the U.S. telecommunications industry, dropped a bombshell. The commission published a proposal that would create “super Wi-Fi networks” across America, making wireless connection free for everyone. The FCC plan is to require television stations and other broadcasters to sell back to the government unused airwaves so they can be reemployed for public Wi-Fi networks. The reused broadcast frequencies would have a reach of
a mile or more, be able to penetrate walls and enclosures, and allow users to make free calls from their mobile phones on the Internet, as well as use the Wi-Fi connection in their homes and businesses for free, slashing the cost of Internet bills.
36

The harnessing of near zero marginal cost communications to manage near zero marginal cost renewable energy gives society the critical operating platform to build out the Internet of Things infrastructure and change the economic paradigm. The controversial FCC proposal has pitted the wireless carriers of the nation’s great telecommunications companies, including AT&T, T-Mobile, Intel, and Verizon, against the equally formidable Internet and IT companies like Google and Microsoft. The former, which have paid out billions of dollars to secure FCC spectrum licenses, risk heavy losses to their $178 billion wireless industry.
37
The latter argue that free Wi-Fi connection will spur the introduction of “millions of devices that will compose the coming Internet of Things.”
38
Google is already providing free Wi-Fi in the Chelsea section of Manhattan and in some neighborhoods in Silicon Valley.
39

Industry analysts are predicting that free Wi-Fi “could replace carrier service.”
40
The FCC is of a like mind. One FCC official says, “We want our policy to be more end-user-centric and not carrier-centric.”
41

The FCC proposal comes as a result of dramatic technological advances over the past decade that have transformed the electromagnetic spectrum from a scarce resource to a potentially infinitely available one, just like solar, wind, and geothermal heat. When broadcast radio emerged in the 1920s, if two or more broadcasters in close proximity to each other were using the same spectrum frequency or a very close one, they would continually interrupt and interfere with one another’s broadcast signals, making the communication unintelligible. By 1927, the proliferation of radio broadcasters was creating chaos in radio reception, forcing Congress to pass the Radio Act to establish the Federal Radio Commission (FRC), whose mission was to determine which frequencies could be used and who could use them.
42
The subsequent Communications Act of 1934 vested the spectrum allocation to the newly established Federal Communications Commission.
43
The FCC took on the responsibility of managing the spectrum, which meant licensing a specific frequency in a given location to a broadcaster or other parties for their exclusive use. The spectrum itself was viewed as a scarce resource and therefore regarded as a valuable commercial asset.

Today, new technologies for managing communications over the radio frequencies have made the concept of the spectrum as a scarce resource null and void. That new reality is changing the very nature of broadcast communications. Smart antennas, dynamic spectrum access, cognitive radio technologies, and mesh networks are among the new technologies that are expanding the spectrum to an abundant resource
by using it more efficiently and with greater agility. The new technologies can concentrate a transmitted signal so that it goes only to the user’s antenna, avoiding interference with other antennas. They can also sense other transmissions and share unused spectrum. They can scan the spectrum, searching for temporarily unused holes to use. In a wireless network, the radios can even coordinate information with each other, allowing for parallel transmissions and an optimization of a particular time-frequency slot.

A report by the National Telecommunications and Information Administration (NTIA) in 2010 on the future use of unlicensed spectrum observed that “when such technology is available, the capacity of the radio-frequency spectrum will be multiplied exponentially” and by “many orders of magnitude.”
44
The NTIA report concluded that “if even a small part of this potential is realized, today’s concept of spectrum shortage may dissipate and the need for traditional frequency regulation based on licensing may be dramatically altered.”
45

Many industry observers say that the new technologies are going to make the airwaves “so abundant that there would be no justification for the government to ration access to spectrum or to give some services priority over others.”
46
In the near future, everyone will be able to share Earth’s abundant free air waves, communicating with each other for nearly free, just as we will share the abundant free energy of the sun, wind, and geothermal heat.

Open wireless communication, carried over Wi-Fi networks, is quickly surpassing traditional licensed wired communications. A study by comScore found that “in December 2011, Wi-Fi connections drove 40.3 percent of mobile Internet connections and 92.3 percent of tablet Internet connections in the US.”
47
Even more interesting, a Cisco report uncovered the fact that only 35 percent of mobile data use was “on the move,” while 40 percent was from home, and 25 percent from work.
48
And in 2012, 33 percent of all the mobile data was offloaded to Wi-Fi networks. The Cisco study forecasts that the percentage will exceed 46 percent by 2017.
49

The impact of open wireless communication via Wi-Fi networks is going to be most pronounced in the management of the smart grid. Open wireless strategies already account for over 70 percent of smart grid communication.
50

The use of open wireless connections over a free Wi-Fi network is likely going to become the norm in the years to come, not only in America, but virtually everywhere. It’s just too beneficial for the human race to turn down, regardless of the push back by conventional wired carriers. The notion of communicating over proprietary, centralized, wired communications networks is going to be little more than a historical curiosity to young people living in the mid-twenty-first century.

Beyond Governments and Markets

We are waking up to a new reality that is difficult to fathom. We have been so convinced of the economics of scarcity that we can hardly believe that an economy of abundance is possible. But it is. New communications technologies are turning the broadcast spectrum from a scarce resource to an abundant one, just as with information, renewable energy, 3D printing, and online college courses. The journey to an economy of abundance, however, is cluttered with roadblocks that could delay and even derail the collaborative era. The challenge is finding a governance model that can take society into the new paradigm. That search takes us right back to the marginal cost controversy that put two great economists at loggerheads nearly seven decades ago. Hotelling and Coase squared off over two distinct governing models for society. Hotelling argued passionately for government management of public infrastructure goods while Coase championed governance by markets.

Other books

Lady Moonlight by Rita Rainville
Sisters of Sorrow by Axel Blackwell
The Longest Winter by Mary Jane Staples
Paycheque by Fiona McCallum
Killer in High Heels by Gemma Halliday
Let's Get Invisible by R. L. Stine
Bell Weather by Dennis Mahoney
Chasing Redbird by Sharon Creech