The Big Switch

You've probably noticed that I have been posting a lot about the author Nicholas Carr lately.  I have read several of his articles, blog posts, and books over the course of the last several months, and I believe his commentary on both the positive and negative consequences of the Information Age are incredibly relevant in society today.  One of his older books, The Big Switch: Rewiring the World, from Edison to Google, compares and contrasts the commoditization of electric power in the early 20th century with the rise of cloud computing (instead of storing applications on your individual PC, everything is stored in a central data warehouse) in the 21st century.  

Just as electricity was turned into a utility by centralizing and standardizing power generation, the shift of data storage, computing power, and software services to centralized, remote data centers is turning computing into a utility.  And, similar to what happened with electric power, the commoditization of computing will fundamentally change how organizations operate by reducing the need to own and maintain IT infrastructure (see also Carr's Harvard Business Review article "IT doesn't matter" and book Does IT Matter?) and making technology more accessible.  

Carr introduces his thesis at the beginning of the book, writing, "We see the interplay of technology and economics most clearly at those rare moments when a change takes place in the way a resource vital to society is supplied, when an essential product or service that has been supplied locally begins to be supplied centrally, or vice versa.  Civilization itself emerged when food production, decentralized in primitive hunter-gatherer societies, began to be centralized with the introduction of the technologies of agriculture. Changes in the supply of other important resources - resources as diverse as water, transportation, the written word, and government - also altered the economic trade-offs that shape society.  A hundred years ago, we arrived at such a moment with the technologies that extend man's physical powers.  We are at another such moment today with the technologies that extend our intellectual powers."

Carr chose to begin his history of electrical power with Burden's Wheel, a water wheel believed to be one of the largest and certainly the most powerful vertical water wheel ever built, used to power the Burden Iron Works located on the Hudson River near Troy, New York.  The wheel, which was built by Henry Burden around 1836, measured 62 feet in diameter and 22 feet in breadth and weighed over 250 tons!  When moving at full speed at two-and-a-half revolutions per minute, the wheel produced 500 horsepower of energy to fully run the Iron Works.  Burden's Wheel was apparently the inspiration for the first ever Ferris Wheel, built by George W.G. Ferris at the 1893 World's Columbian Exposition in Chicago.  Ferris was educated at the Rensselaer Polytechnic Institute in Troy.  On a side note, several of the temporary buildings that were designed and built in the neo-classical style by the famous architect Daniel Burnham were painted white, and as a result, the Exposition site was nicknamed the "White City" (see also the wonderful book by Erik Larson, The Devil in the White City: Murder, Magic, and Madness at the Fair That Changed America).  The "White City" was apparently the inspiration for the Emerald City, the city in L. Frank Baum's The Wonderful Wizard of Oz.

In the early Industrial Age, every factory had to have its own source of power (i.e., Burden's Wheel at the Burden Iron Works), which significantly increased the costs associated with doing business.  Starting around 1900, individuals like Samuel Insull, one of the early entrepreneurs in the electrical power industry (for those of us who live in Chicago, Insull founded Commonwealth Edison, Inc, better known as ComEd) and Thomas Edison, recognized that a better option would be to centralize the generation of electricity and then distribute it to the factories.  Carr writes, "Manufacturers came to find that the benefits of buying electricity from a utility went far beyond cheaper kilowatts.  By avoiding the purchase or pricey equipment, they reduced their own fixed costs and freed up capital for more productive purposes."  The national power grid was born from the efforts of Insull, Edison, and others.

Carr next launches into a history of early computers in the so-called Information Age.  What's striking to me is how short-sighted the early pioneers in the computer industry were given what happened with the electrical power industry.  For example, the Harvard physicist Howard Aiken who helped design IBM's first programmable computer dismissed as "foolishness" the idea that there would be a big market for computers.  The scientists who developed the UNIVAC computer in the 1940's believed that the United States would need no more than a half dozen or so computers, primarily for military and scientific applications.  Indeed, IBM's Thomas Watson said in 1943, "I think there is a world market for about five computers."  I still remember when my parents purchased our first home desktop computer - it may have been a TI-99/4A (basically, a keyboard that connected to a regular television that had about 16K memory and required a regular tape recorder and cassette tape to permanently save anything), but I am not 100% sure.  Fast forward several years later to when my wife and I had school-age children of our own, we always had a desktop computer in our house.  Now, the mobile telephones that we carry with us everywhere we go have about 1 million times the memory of the computers used during the Apollo space program!

Thanks to the Internet and advances in modern computing, we now have instant access to information at our fingertips.  Carr sees that the same thing that happened at the turn of the 19th century with the electrical power grid today is happening today with the computer industry - we have democratized and commoditized information.  He writes, "What happened to the generation of power a century ago is now happening to the processing of information.  Private computer systems, built and operated by individual companies, are being supplanted by services provided by a common grid - the Internet - by centralized data-processing plants.  Computing is turning into a utility..."  

In regards to technology, there are always going to be optimists and pessimists.  It's fairly easy to see that Carr takes a more pessimistic view of technology, as he provides a counterviewpoint to so-called "techno-utopianism" in all of his writings.  Arguing for the optimists, Nicholas Negroponte, author of the 1995 book, Being Digital wrote, "Digital technology can be a natural force drawing people into greater world harmony."  The Internet was once felt to be a tool that would increase the diversity of thought and opinion, but it probably has done the reverse!  Harvard Law School professor and author Cass Sunstein argues for the pessimists, suggesting that the Internet, and in particular, social media, have only pushed us further apart (see his article on ideological amplification).  As I have suggested in a number of previous posts (see, in particular, "Why the past 10 years of American life have been uniquely stupid..." and "Familiarity breeds contempt..."), Carr feels the same way as Sunstein.

The pessimists typically use terms such as fragmentation, polarization (or even hyper-polarization), balkanization, and single-mindedness when talking about the impact of information technology on today's society.  At the extreme, they even use terms such as fanaticism, radicalization, and extremism.  However, there are additional downside risks with the "big switch" from traditional IT systems to cloud-based systems.  Carr addresses the potential security concerns (though even with the most advanced cybersecurity systems, traditional IT infrastructure is at risk as well), the potential loss of control, and the concentration of power in a few large, dominant companies such as Amazon, Google, and Microsoft.  

I am trying to keep an open mind, but the more I read, the more I find myself leaning towards the side of the pessimists.  When it comes to any argument, it's important to keep a balanced view for as long as possible, so that you can listen to both sides equally.  I've probably spent too much time reading what the pessimists have to say, so it's probably time to read more about what the optimists are saying (I could probably start with Marc Andreessen's Techno-Optimist Manifesto).  I've at least read all of Nicholas Carr's books, which makes it an even better time to move on to a new viewpoint.