Some enormous obstacles confront us now and could impede our transition into the Digital Age. Here are five major areas that will pose very significant challenges.
The Digital Revolution is changing the very notion of property, which underlies our entire economic and legal system. And property essentially defines who holds power in a society.
In the Agricultural Age, property came in the form of land. Those who held power were the landowners. In the Industrial Age, the key forms of property were machines and factories. Those with the most power were those with the capital to finance them. In both those systems, people could protect property by erecting fences and paying for security guards, police forces -- or entire armies.
But in the Digital Age, the most important property increasingly takes the form of information, which is intangible. Right now it's not clear who will own this information: the creator or the distributor. And this kind of intellectual property is extremely difficult to protect in the digital environment of computers. People can make millions of exact copies of, say, a copyrighted document, for almost no cost. This is happening right now on a large scale in Russia and many Asian countries. American software, music and movies are being illegally copied and sold on the cheap.
The implications of these changing notions of property are huge, and we have no idea how to handle them. Who will own the property at the heart of our economic system? How will the owners be compensated for their ideas? How will we protect their newly defined property rights? Will this lead to a fundamental shift in power in society as a whole?
We're overdue for an economic theory that more accurately describes how our economy works. Our gauges of economic activity are almost all rooted in a manufacturing economy and are ill-suited for measuring such important things as productivity in our service economy. But a young generation of economists, such as Paul Romer of the University of California at Berkeley, is trying to rethink macroeconomic theory. Romer is trying to get away from the focus on fiscal policies and short-term economic cycles and instead look at the role of technology in long-term economic growth.
On the micro level, we're likely going to need new business models. For example, in the Digital-Age economy, you can make money by giving away your product, such as a software program on a disk, in hopes of making money later on tailoring the product or providing ongoing services. The new software firm Netscape, among others, has already used that tactic with great success.
We're really at square one in trying to figure out how to apply direct democracy on a broad scale. For example: What do we really mean by democracy? And are there inherent limits to the number of people who can actively participate in governing themselves?
At a more basic level, governments will have to reexamine many of our laws to clear a path to the Digital Age. The federal government is now in the midst of overhauling our telecommunications laws, which have remained largely unchanged since 1934 -- before the dawn of television, let alone computers. State governments will have to examine such laws as workers' compensation that were devised with no concept of people working out of their homes. And local city and suburban governments will need to reconsider zoning laws before decentralized work environments, including some types of home offices, can exist in residential areas.
We may be heading into one of the most intense reexaminations of our civil liberties since the framing of the Constitution. We'll have to rethink how our rights as free citizens in the physical world apply to the world of cyberspace. This realm of computers defies simple analogies to such previous media as television. It's more like a public place, a town square, in which you can travel and speak. But it's also like a broadcast medium, because millions of people can hear your conversations in that town square. Right now the earliest battles defining the right to free speech are being fought over how much censorship the government can impose in the name of containing pornography.
Next will be huge battles over issues related to individual privacy. Eventually we'll even have to rethink our right to assemble in some future version of virtual reality. These precedent-setting cases will soon choke the courts.
The Digital Age will be built on a foundation of software. Some people, including some programmers working in the computer industry, fear that our current standards of software are not rigorous enough. They fear that we're allowing too much buggy or inefficient software to spread into our increasingly powerful digital technologies. At some point, when we've become completely reliant on these systems, our digital house of cards could crash.
Today software engineers need to devise new models of software to be the rock-solid, interchangeable building blocks at the foundation of the digital world. We also need to define general standards for the new information infrastructure so that everything will work together in the long run, both in this country and abroad.
