Tyranny of the Commodity?

Kevin Werbach is an independent technology analyst, consultant, and writer, as well as CEO of the Supernova Group . Werbach is a contributing editor of Release 1.0: Esther Dyson’s Monthly Report, and co-organizer of PC Forum. Previously, he served as Counsel for New Technology Policy at the Federal Communications Commission, where he helped develop the United States Government’s e-commerce policy. What follows is a partial transcript of his second-day morning presentation at Supernova:

I want to talk about one of the challenges that arises along with decentralization, and that’s commoditization. It’s a case of the glass being half full or half empty. Where is the value? Traditional companies are used to controlling the experience and the interface. The value is moving up through the layers, but it’s challenging the traditional ways business is done. All of those layers are moving from what used to cost a lot to being free. More and more content is being made available voluntarily as more personal media is being created. Software is increasingly going to zero through open source and the service model. Even networks are increasingly becoming free.

All that is great for end users, but why would anyone provide any of these things if they are free? What’s the incentive to package all those things together? That’s a challenge, but it’s also an opportunity. Do we have too much of a good thing? Does it create some of the conflicts we see between IT vendors and customers, content owners and users, network operators and subscribers, and regulators and the private sector? All that gets accelerated as things become more commoditized.

I don’t have any answers, but I’d like you to free associate a little. Consider concepts like incentives, platforms, legacy, rules, openness, and trust. Those are the issues we’re going to have to work through.HR