Database Reference
In-Depth Information
In fact, in analogy with Sun Microsystems's vision of
Network is Computer
, one can
say that
Network is Resource Provider
! (see Kale 2014)
1.2.2.2.2 Business Webs
Don Tapscott introduced the concept of a Business Web (B-Web) as a cluster of businesses coming
together particularly over the Internet. B-Webs are the mechanisms for accumulation of digital
capital consisting of three parts:
1.
Human capital
: Is the sum of the capabilities of individuals in the enterprise including skills,
knowledge, intellect, creativity, and know-how.
2.
Customer capital
: Is the wealth contained in an enterprise's relationships with its
customers.
3.
Structural capital
: Is the knowledge embodied in enterprise procedures and processes.
The rise in affiliate marketing and the existence of Internet-based extranets or exchanges are exam-
ples of the rise of B-Webs.
MOOR E'S L AW
Gordon Moore, one of the Intel founders, observed that computer processor per-
formance for transport, storage, and processing of data doubled roughly every
18 months at constant cost. This law has held true for the last few decades and has
potential to hold valid in future as well. The true significance of this law is its indication of
the rapidly shrinking footprint of the computing devices.
METCALFE'S LAW AND NETWORK EFFECTS
Robert Metcalfe, the inventor of the Ethernet and founder of 3Com, evaluated that the
value of a network increases as the square of the number of users; consequently, additional
users are attracted to connect to the network resulting in a virtuous cycle of positive feed-
back. Considering that the original observation was inspired by telephonic systems that are
typically bilateral, the value associated with computer networks that admit multilateralism
is manyfold. Thus, for computer networks with
n
number of nodes allowing conversations
of m users simultaneously, the value of the computer network may increase as
n
m
! This
phenomenon has important implications for corporations competing in network markets.
While in the traditional economy, value is derived from scarcity, in the network economy,
critical mass supercedes scarcity as a source of value. Positive feedback works to the advan-
tage of big networks and to the detriment of smaller networks. Consequently, the bigger
networks continue to grow bigger, while the smaller networks are sucked into a vortex of
negative feedback and shrink to insignificance. The classic examples of this phenomenon are
Microsoft Windows rapid ascendancy to market domination against other alternatives like
Apple or UNIX operating systems or the VHS versus Betamax standard battle.
