Top 5 Identity Fallacies: #5 Net 2.0 Can Happen Without Solving Identity

Nearly everyone who has been following the progress of the internet has observed that we are nearing a moment of major change that will affect not only how the net is used, but will create many new business models and alter many current ones. Pieces of this change moment have different buzz-names, but for the purposes of this article let's lump them all together under the term Net 2.0.

This change moment Without solving the identity problem, this moment will yield very little of its promise.is characterized by a few major directional forces. There is the trend towards collaboration, with new technologies arising to facilitate this trend. There is a trend towards companies providing services rather than just software that is clear, but still searching for its form (think things like Windows live, Software as a Service, etc.) Then there is the general drive of networking to break down the walls of silos, connecting everything to everything else.

With all the focus on these changes, however, it is rare that pundits comment on barriers to these trends. The main barrier is that while all this new connectivity and collaboration is taking place, there is no networked organizational paradigm to avoid chaos at scale with the new methods. While many see the walled garden web coming apart, Eric and I see something quite different about to occur. And we see this outcome as likely because of the lack of an internet scale, user-focused, cross-domain identity infrastructure.

In either social or business based collaboration, the value of the collaboration is undermined if you can't manage the community that is participating in one way or another. There doesn't have to be a direct "money for service" aspect to things for this to be true, as any blogger who has suffered through blogspam can tell you.

Entropy is every bit as much a force in the virtual world as the physical world when things reach internet scale. To avoid spending the bulk of your administrative time just cleaning up the mess (undoing virtual entropy) requires an organizing and management paradigm that aligns with what you are managing. Only identity offers this in a large scale networked world.

In the absence of solving the identity problem for the internet in a way that focuses on the internet at large, not just specific domains within it such as enterprises or specific sites, there are two possible results. In one direction lies entropy to the point of rendering the mission useless (e.g. blogspam.) Down this path lies the end of open collaboration, with the mission being relentlessly redefined over time into one-way communication or other barriers to participation. This path also erodes any ability to monetize collaborative services, as entropy undermines whatever business model is attempted.

In the absence of a generalized internet identity solution, virtual entropy can only be avoided by creating silos and walled gardens with localized identity controlling access to them. The large internet sites already find themselves in this position, and have no incentive to organize any other way in the absence of a better alternative. Thus, the concept that silos will crumble and wall gardens will break apart describes an outcome that simply cannot happen without first solving the networked identity problem. Until then, we will only see either one walled garden replaced with a different one, or virtual entropy destroying the new internet constructs.

This moment we are approaching is indeed a classic disruptive moment, as described by the business theories of Clayton Christensenwho coined the terms disruptive and sustaining. His theories, however, also explain that disruptive moments don't always end with the disruptor winning. The structure of the environment in which the competition takes place pretty much dictates whether the disruptive moment will become a transformative one, or just an interesting bit of history absorbed in the growth of those already in place.

Without solving the identity problem in a general way, this moment will yield very little of its promise. In short, whether this internet boomlet becomes transformative for business and society or simply fades with a few new ideas incorporated into what already exists, will largely depend on whether we solve the identity problem or not.