Digital Phoenix: Why the Information Economy Collapsed and How it Will Rise Again

Citation

Calvert, P. (2005), "Digital Phoenix: Why the Information Economy Collapsed and How it Will Rise Again", Online Information Review, Vol. 29 No. 5, pp. 562-563. https://doi.org/10.1108/14684520510628945

Information managers can read this book on a number of different levels. At the first (entertaining) level it is a history of information and computer technologies since about 1975, which has seen the rise and rise of Microsoft to its present imperial level, the rise of Linux as at least some sort of challenger to the Windows hegemony, and the rise and partial fall of Napster. All of them have changed the face of computing, not just at a technical level (for after all, Microsoft has rarely made any technical innovations) but in the way that we, the end‐users access information via computers and networks.

At a higher level Abrahamson deals with network economics, that unusual development of classical economics that shows, by using Metcalfe's Law, how the market fails to correct itself in the presence of a large supplier of networked services. Investors in the dot.com boom often failed to understand the problems of entry into a networked environment, and how fiercely those companies holding a strong position would fight for their territory. This resulted in the high number of failures of start‐up companies which simply could not break into tightly‐controlled markets. There is a good deal on the Microsoft trials here, showing how the company used a range of tactics to overtake and crush rivals threatening their position as the gatekeeper to the “translation frontier”, as the author calls it, between the end‐user and the computer itself.

There is a final level to the book, for Abramson considers that the battles for control of the software and operating systems markets are not about the technology as such, for it is obvious that the best product does not always win, nor is it primarily about anti‐trust laws, even though they are important. His claim is that the central importance lies with intellectual property (IP) laws and how they have been used by companies such as Microsoft to strengthen their hold on the market. It is by gaining a better understanding of IP, he claims, that the information economy will rise again. This is a book that I first thought might be rather dry, but it turned out to be compelling stuff and easy to absorb, despite some of the legal issues discussed by the author. It is recommended reading for any information manager who cares about the wider environment in which we work.