Emergence, Crisis, and Replacement of the Era of Decentralized Networks
• Article: Emergence, Crisis, and Replacement of the Era of Decentralized Networks. By David de Ugarte
Excerpted from the Book: The Power of Networks. [1]
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David de Ugarte:
The Emergence of Decentralized Networks
Case study of how technology influences power structures. David de Ugarte examines how the telegraph was instrumental in creating decentralized networks and world structures.
David de Ugarte:
“Technology, and particularly communications technology, generates the conditions of possibility for changes in power structures. Daniel R. Headrick argues in The Tools of Empire that 19th century European imperialism, which at one point controlled three quarters of the surface of the Earth, only became possible when transport and communications technology resulted in the establishment of economic networks […] After all, before a colony could become valuable and annexed to a European economy, a communication and transport network had to be laid.
The key element that made possible the division of Africa in Berlin in 1885 was the previous existence of a primitive network of instantaneous telecommunications: the telegraph.
The first telegraph line between the United Kingdom
and France was made available to the public in November
1851. The first direct message between London and Paris
was sent a few months later. In 1858, the first transatlantic
cable linked the United States with the European network.
It was the beginning of what Tom Standage called, in a
wonderfully epic book, “the Victorian Internet”.
Even though Standage displays in his book a rather
ironic attitude towards the eventual effect that the
telegraph had on diplomatic relations (inasmuch as it
completely modified military strategy), it is nonetheless
interesting that the three countries that were first linked by
that network have remained allies to our day. The
telegraph not only joined the United States’, Britain’s and
France’s stock exchanges, but also brought together and
merged their respective economic interests, providing the
drive both for the earliest globalisation and for
imperialism. And that drive was more powerful than the
rivalry generated by the centrifugal force that was the
competition between the three countries.
Moreover, the creation of news agencies (Associated
Press and Reuters), the direct descendants of the telegraph,
contributed to the establishment of an agenda in the public
debate between the three powers.
It is hard to understand nowadays the extent of the
importance that news agencies had for democracy. The
main advance was at first that they made it possible for
national and global news to be included in the local press
at a time when literacy was on the rise, as a result both of
production needs (machines required more and more
complex skills from workers) and of the educational
activity within the trade movement itself.
But by introducing national and international affairs –
until then the exclusive matter of government elites – into
the popular press (and not only the “bourgeois” press, well
beyond the means of most people both because of its price
and its language), foreign and State policy became
something about which any citizen, whatever his social
class, could have an opinion. Arguments for census
suffrage became obsolete because information and opinion
now belonged to the entire citizenship.
In fact, the telegraph was also the main factor in the
rise of new topics and new values. It made it possible for
trade unions to envisage coordinated actions in France and
England. The 1864 call for the conference which would
eventually become the basis for the First International was
a direct consequence of the engineering work by which the
first telegraphic cable was laid beneath the English
Channel. Trade unions and workers' associations were
keen to foil factory owners' plans to avoid strikes by
moving production from one side of the channel to the
other. They saw very clearly that the telegraph made it
possible to coordinate their own demands. Proletarian
internationalism, which would become a trademark of the
end of the 19th century and the first third of the 20th
century, was – like its polar opposite, imperialism – a
possibility which was only opened by that first
international web of copper cables.
But the complete political translation of the
consequences of the new information structure would
come later, in the Second International (1889). Its aim was
to promote large organisations which would coordinate
social movements on a national level, and which by
entering the political arena would defend workers'
interests in national parliaments.
We can say that the original socialdemocratic
movement and its model, the SPD, are the children of that
“decentralised”(but not distributed) vision of the world,
from its territorial arrangement to its conception of the
State. The case of French Socialism is particularly
striking, as its history is linked not to Paris but to a small
provincial town, ClermontFerrand,
which happened to lie
at the centre of the French railway and telegraph network.
Nowadays we find it natural (because it is so usual)
that power should be conceived of in a decentralised
way,that human organisations (States, companies, associations,
etc.) should be articulated in hierarchical levels
corresponding to territorial spaces. We are also
comfortable with the structure of social and political
representation derived from such a decentralised
conception of power, as well as with the fact that it takes
place through the gradual centralisation (local, regional,
national, international, global, etc.) of decisions taken over
an equal universe of topics at each level.
…
Decentralised structures were originally the result of the effective interconnection of centralised networks, but in the long run they produced their own logic, generating new, higher, non-national nodes, such as news agencies at first, and later on the first multinational companies. IBM displayed the extreme vigour of the autonomous hierarchisation of its nodes when it acted as a supplier for both sides during the Second World War. According to certain researchers, the internal logic of IBM was that of a “pure” decentralised organisation, where any branch of the tree can be isolated from the rest. The Nazi government pressed IBM for information about the Allies' technology, and Roosevelt in turn tried to use IBM to block the German management system. IBM's response was to give both sides a symmetrical ultimatum, together with a promise of complete impermeability – only the Founding President of IBM (the cusp node in the hierarchical decentralised tree) would be in possession of the information from both sides. In order to make this possible, the German branch of the multinational had become completely independent in 1941.
The first network revolution, which shaped our world,
was the passage from the tendency towards centralised,
national organisations characteristic of the modern State to
the tendency towards decentralised, international entities
in the 19th and 20th centuries. We have gone from local
strata to national classes, from wars between States to
wars between blocks and alliances, from colonies to
imperialism, from clubparties
to mass parties. And it was
all made possible by the first great revolution in
telecommunications.”
(http://deugarte.com/gomi/the-power-of-networks.pdf)
The Crisis of Decentralized Networks
David de Ugarte:
“But even then there were already signs that the global decentralised system was approaching critical point. The value of system production kept increasing dramatically by comparison to its weight in tonnes. The percentage of that value due to the scientific and technical components of production became ever more crucial. But as the system relied more and more heavily on science and creativity, it became increasingly clear that the incentive system provided by the hierarchical decentralised production model was a burden slowing the process down. The first cultural responses started soon after, snowballing into a mass phenomenon with the 1968 students' movement in the United States. New values and new topics were on the rise. At the crossroads of computer science and academe, a new kind of character appeared: the hacker. As Eric S. Raymond described it in his famous book, the hacker's model of intellectual production and information processes, created within the main American universities, looked like a bazaar rather than a cathedral (which Raymond likened traditional companies to).
The first two skirmishes which the thentiny
circle of hackers engaged in would come to have global
consequences. The first one, in 1969, was started by
Whitfield Diffie, a young mathematician who had
travelled all over the United States in search of scattered
clues concerning the (secret) evolution of cryptography
since the beginning of the world war. By interviewing war
veterans and combing through libraries and memories, he
created the fragmentary map of a hidden world. He was
funded by no one – Diffie, a purebred
hacker, possibly the first hacker in the information society, did it all for
art's sake. He would soon come farther than any
intelligence system had ever reached: he discovered and
implemented asymmetric cryptography, the current basis
for all secure communications. Thanks to him,
cryptography ceased to be restricted to the world of
(military) secrecy, and passed into the domain of private
use – from the closed community of intelligence, it fell
into the hands of hackers and applied mathematicians, to
the great annoyance (and endless court battles) of
American government agencies.
When reading Steven Levy's wonderful telling of this
epic in Crypto, one cannot help but wonder how on earth
that could happen. How could the most paranoid scientific
bureaucracy in history, fifteen years before the fall of the
Berlin Wall, let something as important as the possibility
of secure asymmetric ciphering slip through their fingers?
How could a few hippies fool them and effectively render
the until then almighty agencies helpless? How could IBM
just not notice?
What had happened was only a harbinger of the world
to come. The answer is simple: the logic of incentive
systems. As any economist could tell you, the incentives
which the old closed system could provide were not in
alignment with the new aims to be achieved. It was only a
matter of time for a Diffie to turn up.
The second battle is still being fought. The man
responsible for starting it may be the most famous hacker
in history, Richard Stallman. Unwilling to accept that he
could be prevented from sharing or improving on his own
developments, Stallman launched a devastating criticism
against software copyright. As a result, GNU, GNULinux,
and other licences were created, which would
constitute the basis for the first great structure of free
property in distributed development – the free software
movement.
But two things had been previously necessary for all
this new, alternative production system to burst forth: the
development of personal computing tools, and a
distributed global network of communications between
them. That is, the PC and the Internet.
Let us go back to 1975 in Los Altos, California. A
clichéd image: two hackers sharing a workshop in a
garage. They build and sell Blue Boxes, circuits which
when connected to the phone fool Bell terminals and allow
callers to make free calls. The hackers are Steve Jobs and
Steve Wozniak. Wozniak puts forward the project of
building a computer for personal use at the Homebrew
Center, a club for electronics hackers. Jobs comes up with
a plan: he will sell his van if Wozniak sells his calculator
(calculators were still quite expensive then), and they will
both set up an assembly workshop in the garage. But Jobs
works for Hewlett Packard. The terms of his contract force
him to offer any ideas he might want to develop to HP
before working on them on his own. Jobs and Wozniak
arrange a meeting with HP and try to sell them the idea.
The response from HP is as expected: computers are for
managing large social processes, they require much more
power than a smaller machine could ever have, and
moreover a small computer would be useless in the home.
A personal computer would be something like a bonsai
tree which would never take root. Who would ever want
such a thing?
And indeed Apple I was not particularly powerful: 4
Kb which could be increased to four more, with optional
cassette storage. But that was the first step towards turning
HAL off. Apple II was launched in April 1977, and Apple
III, which already had a 48Kb capacity, in 1979.
After that, nobody had to explain any more what a
personal computer was, or what it was for. In universities,
the budding hacker communities took Jobs and Wozniak's
cue and started building computers. In 1980 IBM followed
suit and designed the first IBM PC, in an attempt to ride
the turning tide.
The idea wasn't bad. It involved selling, assembling,
and designing, within an open architecture, computers
made from cheap thirdparty
components. All the power
of the IBM brand should be enough to swallow the nascent
domestic market whole, and keep possible licenser-granters
and clonemakers within specific segments.
But that's not what happened. Things had changed.
IBM thought of its machines as relatively autonomous
substitutes for the old dumbeddown
terminals. It thought
of PCs as cogs within the old centralised architecture,
thicker branches for its trees. Because they had a universal
openarchitecture
model, electronics hackers were able to
start building their own componentcompatible
machines, and even to sell them much cheaper than the blue giant's
originals. The hacker's dream – to make a living from
computers – was becoming true. Electronics hackers in the
70s ended up setting up their own little workshops, stores,
and garages. Without techie defenders, Apple would
eventually disappear even from the underground, but PCs
would gradually become detached from IBM.
When you have more than one computer at home,
even if you are only setting someone else's computer up
for them, it's inevitable that you'll be tempted to turn them
into a network. When your friends have a modem and you
can devote a computer to sharing stuff with them, it's
inevitable – particularly when local calls are free – that
you will leave it on all day, connected, so that your friends
can connect to your computer whenever they feel like it.
The more powerful PCs became, the more powerful the
hackers' network architectures grew too.
Like a creeper growing on a tree, the use of this new
kind of tool gradually spread and became distinct
throughout the eighties. That was when the structures that
would shape the new world were created: LAN home
networks, the first BBS, Usenet – different inventions by
different people with different motivations. The advent of
free, mass consumption
Internet drew ever nearer. It was
what the changing times were calling for. Even though
hackers didn't realise it then, all those innovations were
expressing not only the hackers' own way of selforganisation
and of representing reality, but the entire
architecture of a new world which would have to be
represented and organised as a network in order to work
and give rise to a new kind of incentive. Soon an
increasingly dense creeper made up of little bonsai
computers would smother HAL and disconnect him for
ever.
A few paragraphs have taken us on a dazzling journey.
The decentralisation which had arisen as a possibility with the advent of the telegraph restructured the world almost completely after the Second World War. But a global, decentralised world is a world with huge management needs, a world requiring computers and instantaneous information. Information, technology, and creativity became increasingly important for production value. But it is hard to encourage creativity and scientific development within a decentralised hierarchic structure.” (http://deugarte.com/gomi/the-power-of-networks.pdf)
Hacker Culture as the successor to the decentralized systems era
David de Ugarte:
“Hacker culture represents the alternative mode of organisation characteristic of the incentive system demanded by those selforganised research groups. This is an incentive system that questions socalled “intellectualproperty” and the very topology of information structure. In order to create, in order to generate value, hackers require free access to information sources. Every node demands its own right to connect to other nodes without going through any centralnode filters. In this way, they can further develop the technological tools they have inherited. PCs and the Internet are the instruments for computing and data transmission within a distributed structure.
But information structures are not innocent in the
least. Topology entails values. And as Himanen points out,
the hacker movement has developed a work ethics based
on recognition, not remuneration, and an ethics of time in
which the Calvinist dichotomy between labour
(understood as a divine punishment) and joyful “leisure”
has disappeared. These values have become attached to
the design of new tools and the cultural and political
changes which they have brought about.
Yes: political changes. For the changes in the structure
of information brought about by the Internet have opened
the floodgates to a new distribution of power. The
Internet, connecting millions of hierarchically equal small
computers, has led to an era of distributed networks and to
the possibility of going from a world in which power is
decentralised
to a world in which power is distributed.
And that is the world we are building.”
(http://deugarte.com/gomi/the-power-of-networks.pdf)