&c1=usa&c2=(none)&c3=The+Observer&c4=Digital+media,Business,Media,Observer&c5=&c6=John+Naughton&c7=2002_11_04){kind=small}
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- The Observer,
- Sunday November 3 2002
In 1956, a small American company invented a device called the 'Hush-a-Phone'. It was a plastic cup designed to be attached to the microphone end of a telephone handset in order to facilitate telephone conversations in noisy environments - rather like cupping your hand over the phone.
When Hush-a-Phone appeared on the market, AT&T - then the monopolistic supplier of telephone services to the US public - objected, on the grounds that it was a crime to attach to the phone system any device not expressly approved by AT&T. Hush-a-Phone had not been thus approved. The Federal Communications Commission agreed with AT&T. The fact that the device in no way 'connected' with the network was neither here nor there. Hush-a-Phone was history.
A few years later, when Paul Baran proposed the packet-switching technology which eventually underpinned the internet, AT&T first derided and then blocked its development. One of AT&T's executives eventually said to Baran: 'First, it can't possibly work, and if it did, damned if we are going to allow the creation of a competitor to ourselves.'
Note the verb 'allow'. In a single word it explains why we should never permit the established industrial order to be the gatekeepers of innovation.
This is not widely understood by legislatures or governments, and it is particularly not understood by our own dear DTI (aka the Department of Torpor and Indolence), which thinks that the way to encourage innovation is to get all the established players in an industry together and exhort them to do it.
Innovation comes in two forms. The first is incremental - the process of making regular improvements to existing products and services. This is a cosy, familiar business which is easily accommodated by the established industrial order and by its regulatory bodies. It is what governments and corporations have in mind when they declare that they are in favour of innovation.
The second kind of innovation is the disruptive variety - defined as developments that upset, supersede or transform established business models, user expectations and governance frameworks and create hitherto unimagined possibilities. In other words, change that upsets powerful applecarts.
This is the kind of innovation that the established order really fears - and often tries to squash. And yet, if our societies and economies are to remain vibrant, it is the only kind of innovation that matters. We are thus faced with a dilemma: on the one hand, we need disruptive innovation; on the other, the established order will never make it happen. So what should we do?
This is a central policy issue confronting every modern government. Yet the answer - as a striking new pamphlet from the think-tank Demos argues - is staring us in the face. It involves learning from the history of the internet. The reason it spurred such an explosion of disruptive change is that it was an innovation commons - an uncontrolled space equally available to all. A whole raft of powerful technologies - for example, the world wide web, streaming audio, video conferencing, internet telephony, instant messaging, peer-to-peer networking, interactive gaming, online auctions, chat - came into being because their inventors had unfettered access to the network. They didn't have to ask the permission of AT&T or BT or the DTI to implement their ideas. If the invention was good enough, then it could, and did, conquer the world.
The lesson for the UK - and particularly for Ofcom, the new omnipotent communications regulator - is that the preservation of a commons is vital if real innovation is to be nurtured here. This means, for example, that when analogue TV is switched off, some of the liberated spectrum should be retained as an unlicensed commons so that people can experiment and innovate with it.
Like all great ideas, it's simple. The only question is whether it's simple enough for the DTI to get it.
· The Politics of Bandwidth by James Wilsdon and Daniel Stedman Jones is available from Demos on 020 8986 5488, price £10.
www.briefhistory.com/footnotes/
