Institutions are created to coordinate the working of a group of people.
It can be private, public, for profit, not for profit, large or small.
In essence institutions perform the function of coordination.
Communication costs are primary inputs for coordination.
Recently cost of communication, has been plunging downward rapidly.
We can now design systems to coordinate the functioning of a group,
as a byproduct of the operating system, without regard to institutions.
Flickr is a photo sharing service, which allows people to take photos,
and upload them for sharing with others.
Recently Flickr introduced the concept of tagging.
The tagging is not done, by the special group of people, or the institutions.
The user themselves tag the photos.
The system enables organisations, and retrieval based on the tag.
It provides the infrastructure to do the job.
Job is done by the people.
In this way photos of a mermaid parade, in a remote town, would be available to anyone globally.
When we build an institution, we take on a management objective.
We hire specialised employees.
We hire other employees to manage these employees, to achieve the objectives of the institution.
We need to build a people structure, a economic structure, a legal structure, a physical structure, etc..
All these contribute to the cost.
But we still do not have the photos.
So we hire professional photographers to do the job.
We have created a professional class of people.
Their job is to go and photograph, the mermaid parade, wherever it may be held.
When we build cooperation into the infrastructure, Flickr is the answer.
You moved the problem to the individuals,
rather than moving the individuals to the problem.
By doing this we get the same outcome, but without the full institution.
We loose the ability to command the individuals, they are volunteers.
In return, we shed the cost of the institution.
We can focus on the system for coordination, which gives us greater flexibility.
We are used to making plans in advance.
Another way to look at it, is to say that we are now well coordinated,
and we do not have to take on the problem of deciding what to do in advance.
We will take an example,
there are photos in Flickr tagged 'Iraq'.
The coordination caused in this case is even more difficult then the example of the mermaid photo.
There are more photographers, and it was taken over a wider geographical area.
The photographs are spread over a longer period of time.
On an average there are 10 photographs, per photographer.
In these systems, the average is not really what matters.
In this example, there are about 5500 photos.
We can plot the number of photos per photographer.
The top photographer has taken 350 photos.
A few people have taken hundreds of photos.
Dozens of people have taken dozens of photos.
Then there is a long flat tail.
There are hundreds of people who have contributed only one photo each.
This is called the power law distribution.
It appears often in unconstrained social systems.
This basic maths accounts for the steep slope, and for the long flat tail.
Interestingly, when the systems grow larger, the systems diverge more.
The head gets bigger and the tail gets longer.
The imbalance increases.
Top 10% of the photographers contribute 75% of the photos.
5% contribute 60%.
Top 1% contribute 25%.
Because of the left weighting, the average is more to the left.
This is because, 80% of the contributors have contributed a below average amount.
The average is not in the middle.
This is the math underlying the 80/20 rule.
For example, 20% of the people use 80% of the resources.
Institutions have two tools: carrots and sticks.
The 80% zone is a no- carrot, no-stick zone.
The institutional model always pushes leftward,
treating these people as employees.
The institution's attitude is, ' I can get 75% of the value for 10% of the hires'.
The cooperative infrastructure model's view is different.
Why give up the 25% or quarter of the value?
Reengineer the system.
Build a system so that anybody can contribute any amount.
The tension here is between institution as enabler, and institution as an obstacle.
When we are dealing with a left hand- edge of one of these distributions,
we are dealing with the people who spend a lot of time,
producing a lot of the material we want.
We can hire these people as employees.
We can coordinate their work and get some output.
On the right, where we have people contributing only one photo,
the institution is an obstacle.
One of the first things that happens when you institutionalise a problem,
the first goal of the institution shifts to self preservation.
When institutions are told that they are obstacles,
and there are other ways of coordinating the value,
they go through different stages of reaction.
Denial, anger, bargaining, acceptance.
Most of the cooperative systems today,
haven't been around long enough to come to the acceptance phase.
A CEO was criticising Linux.
According to him,
thousands of programmers contributing to Linux is a myth.
Most of the patches have been produced by programmers who have done only one thing.
Obviously, he will not hire such a person for its institution.
The fact that a single programmer can,
without having a professional relationship with the institution,
improved Linux once, and never been seen again,
should terrify the CEO.
This kind of value is unreachable in classic institutional frame works.
This is the part of the cooperative systems.
Meetup is a service where users could find people,
in their local area and share their interests and affinities.
Surprisingly, the most active group in Meetup right now,
is - stay-at-home moms.
Meetup is the platform, but the value is the social infrastructure.
This concept can profoundly change the way human affairs are arranged.
It is a revolution that can cause a change in the equilibrium.
Web logging is a classic example of mass amateurisation .
It has de-professionalised publishing.
We can publish what we want for a global audience.
There is a debate on whether bloggers are journalists.
It doesn't matter, because its not the right question.
The right question is, how will society be informed.
How will they share ideas and opinions.
If there is an answer to that, it happens outside the professional frame work of journalism.
It makes no sense to take a professional metaphor and apply it to the distributed class.
There is another example of the pro-ana groups.
They are a group of teenaged girls, who have taken to social media,
to setup support groups for remaining and anorexic by choice.
They post pictures of thin models, which they call 'thinspiration'.
They have slogans like 'salvation through starvation'.
We have that attitude that support groups are inherently beneficial.
The logic of the support group is value neutral.
A support group is simply a small group, that wants to maintain a way of living,
in the context of a large group.
Once the infrastructure becomes generically available, the logic of the support group is accessible to anyone.
There are significant downsides to these changes as well as upsides.
They must be aware that non-state actors can try to influence global affairs,
by taking advantage of these infrastructure.
They are not sure where this is leading us.
The printing press caused a revolution.
It upturned existing institutions like the catholic church.
It created new institutions, like the nation state.
We are going to witness loosely coordinated groups getting increasingly higher leverage.
These groups forego traditional institutional imperatives.
They do not decide in advance what is going to happen.
They forego the profit motive.
This will increase their leverage.
Traditional institutions are going to come under increasing degree of pressure.
The more rigidly managed they are, the more they rely on information monopolies,
the greater the pressure is going to be.
This is going to happen one arena at a time, one institution at a time.
The forces are general, but the results are going to be specific.
It is easy to say that we are going to transit, from only institutions,
to only a cooperative frame work.
It is going to be much more complex than that.
Since we can see it in advance, and know it is coming,
it would be beneficial to understand it, and become good at it.