Information Technology Reference
In-Depth Information
Chapter 23
The Social Cost of Social
Value Creation:
An Exploratory Inquiry into the
Ambivalent Nature of Complex
Information Technology Intensive Firms
Jonatan Jelen
Parsons the New School for Design, USA
Marko Kolakovic
University of Zagreb, Croatia
AbstrAct
Google, eBay, Amazon, Facebook, Myspace, Craig's List and their foreign equivalents, such as the
Chinese QQ and Baidu, for example, are ostensibly complex, and - more troublesome - their attitudes are
becoming increasingly contradictory, controversial, and conflicted: For one, Tom Malone's decade-old
predictions of a decentralized network of a multitude of small, cooperating firms did not materialize; to
the contrary and counter to the spirit of the democratic nature of information and information technol-
ogy, these e-giants are defining their own industries and defying regulation, submitting the participants
in their respective markets to proprietary rules via three central tenets: regulatory capture, regulatory
arbitrage, and regulatory opportunism. In the present critical chapter the authors explore these traits
of the Complex Information Technology-Intensive firms and formulate elements of a framework for their
ambiguous nature that may lead to social cost exceeding their initially glorified social value creation.
introduction
they are modular or even incomplete firms with
mostly only fractional functionalities compared to
the traditional Porterian value-chain model, their
user constituencies are fragmented and mostly not
the paying clients, the metrics to measure the at-
tainment of their goals are based on unobservables
and rather difficult if not impossible to quantify
and capture. They are community-based, social
Our object of inquiry are information technology-
intensive firms that are also 'complex' system,
serving multiple constituencies with multiple
objectives, their existence as networks is virtual,
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