Network Effects

A nonlinear presentation

In other words, the slides can be viewed in more or less any order.

There are some groupings within them, generally apparent.

Emergence

In philosophy, systems theory, science, and art,

Emergence

In philosophy, systems theory, science, and art, emergence is the way complex systems and patterns arise out of a multiplicity of relatively simple interactions.

Meme

“A meme (/ˈmiːm/; meem) is an idea, behavior, or style that spreads from person to person within a culture.

A meme acts as a unit for carrying cultural ideas, symbols, or practices that can be transmitted from one mind to another through writing, speech, gestures, rituals, or other imitable phenomena.”

Manuel Lima

Manuel Lima, senior UX design lead at Microsoft Bing, explores the power of network visualisation to help navigate our complex modern world.

Mapping knowledge

Denis Diderot and Jean le Rond d'Alembert: Encyclopédie (1751).

Deleuze and Guattari• A Thousand Plateaus contrasts rhizomatic thinking with arbolic

thinking. (See Table A). “A Thousand Plateaus is organized around the distinction between 'arborescent' and 'rhizomatic'. The 'arborescent' model of thought designates the epistemology that informs all of Western thought, from botany to information sciences to theology. . . .” (Best and Douglas 1991, 98) Arbolic thought is said to be linear, hierarchic, sedentary, and full of segmentation and striation. Arbolic thought is State philosophy. It is the force behind the major sciences. Arbolic thought is represented by the tree-like structure of genealogy, branches that continue to subdivide into smaller and lesser categories. Arbolic thought is vertical and stiff. Rhizomatic thought is non-linear, anarchic, and nomadic.

Rhizomes … cut across boundaries imposed by vertical lines of hierarchies and order. Rhizomatic thought is multiplicitous, moving in many directions and connected to many other lines of thinking, acting, and being. … Rhizomes are networks. Rhizomes cut across borders. Rhizomes build links between pre-existing gaps between nodes that are separated by categories and order of segmented thinking.

Deleuze and Guattari

Rhizomatic Arbolic Non-linear LinearAnarchic HierarchicNomadic Sedentary Smooth StriatedDeterritorialized TerritorializedMultiplicitous Unitary and binaryMinor science Major scienceHeterogeneity Homogeneity

As Massumi points out in the introduction to the work, A Thousand Plateaus is recursive; it is meant to be read as one would sample a record. Place the needle on any groove and listen. Turn the book to any chapter and read. The work is quite unlike most others and is a model for a different way of thinking and being. “A Thousand Plateaus provides an example of such an open system. It does not advocate an intellectual anarchism in which the only rule would be the avoidance of any rule. It deploys variable, local rules….”

“A rhizome ceaselessly establishes connections between semiotic chains, organizations of power, and circumstances relative to the arts, sciences, and social struggles.” (Deleuze and Guattari 1987)

So in that spirit, let’s establish some connections.

風吹けば桶屋が儲かる

Kaze fukeba okeya ga moukaru

A bucket shop profits when the wind blows

As Geraint Anderson wrote in Cityboy,

“With hindsight, it was that fifth glass of absinthe that cost my bank £1.2 million.”

“I understand that my work may have enormous effects on society and the economy, many of them beyond my comprehension.”

— Emanuel Derman and Paul Wilmott, The Modelers’ Hippocratic Oath

Derman and Wilmott are quants, creators of mathematical models for the finance industry. Derman was perhaps the first quant. He moved from an academic job in physics to Goldman Sachs in 1985.

Everything happens for an infinite number of reasons.

Who or what caused the 2008 economic crisis?

Adam Smith, Reagan, Thatcher, Milton Friedman, Timothy Geithner and Larry Summers, Alan Greenspan, Ben Bernanke, the home buyers, the mortgage lenders, the investment banks, the quants, the insurance companies, the ratings agencies? Human greed? Evolution? Chemical addiction to money?

A quant speaks

"Imagine building a million-dimensional graph. Each input - all of the axes but one - is some fact about the world whose future value is uncertain: the temperature this winter, the population growth in China, the price of corn, the number of homes built in Utah, the amount of rainfall in Tuscany.

“Each of these inputs is uncertain, and each can have an effect on the others.

“The output - the last axis, call it the "height" of the graph - is the amount of money that your company will make given any set of values for each of the other 999,999 axes. The higher the graph at any point, the more money you make at that point. Higher - more money - is better.

"You can't build that graph. You can't visualize a million dimensions (this screen is crowded enough with three), you can't think of all the uncertainties in the future that might matter, and you can't figure out how much money you'll make in every state of those uncertainties.

“I just wanted to tell you about it because everything in the financial world is an attempt to catch a flickering glimpse of that graph.

“That graph is the thing, the Platonic form. Stocks and bonds and hedge funds and derivatives and everything else are the shadows, the imperfect methods of approaching the thing.

If you want to make all the money in the world, go make that graph.“

— Matt Levine, What is a Derivative?

Snowden’s revelations on the NSA

"Secret documents published on news website The Intercept on Wednesday showed that the NSA impersonated Facebook web pages in order to gather information from targets. When those people thought they were logging into Facebook, they were actually communicating with the NSA. The agency then used malicious code on the fake page to break into the targets' computers and remove data from them. Last year, Facebook moved to encrypt all its pages, making such impersonation more difficult."

• Other programs disclosed by Mr. Snowden and described by The Intercept include CAPTIVATEDAUDIENCE (“used to take over a targeted computer’s microphone and record conversations”)

• GUMFISH (“can covertly take over a computer’s webcam and snap photographs”)

• FOGGYBOTTOM (“records logs of Internet browsing histories and collects login details and passwords”)

• GROK (“used to log keystrokes”) and • SALVAGERABBIT to exfiltrate data from

removable flash drives connected to a target’s computer.

Other programs disclosed by Mr. Snowden and described by The Intercept include CAPTIVATEDAUDIENCE (“used to take over a targeted computer’s microphone and record conversations”), GUMFISH (“can covertly take over a computer’s webcam and snap photographs”), FOGGYBOTTOM (“records logs of Internet browsing histories and collects login details and passwords”), GROK (“used to log keystrokes”) and SALVAGERABBIT “to exfiltrate data from removable flash drives connected to a target’s computer.” (-RT)

Pando is a clonal colony of a single male quaking aspen

determined to be a single living organism by identical genetic markers and one massive underground root system.

The plant is estimated to weigh 6,000,000 kg, making it the heaviest known organism. The root system of Pando, at an estimated

80,000 years old, is among the oldest known living organisms.

To macroeconomists, Bitcoin isn't scary because it enables crime, or eases tax dodging. It's scary

because a world where it's used for all transactions is one where the ability of a central

bank to guide the economy is destroyed, by design.

— Alex Hern, The Guardian (UK)Is Bitcoin About To Change The World?

I have a big problem with making lists. Lists are not actually very informative. They are an ineffectual way of presenting information, because they are not very intuitive or visual. Lists are linear, unlike most of reality, which assembles itself into complex networks and systems. They do not effectively portray the relationships between their elements. I wish I could draw/write lists in systemic networks effectively, and I spend a lot of time thinking about how I could do that. The best solution appears to be in the form of images, which is why I’m beginning to invest time and energy learning how to draw.

— Visa Veerasamy

“If you pay enough attention, you will find systems and networks everywhere you go… Anything of depth and complexity assembles itself into networks, just like language, economies, human knowledge and academia, cities, consciousness….

— Visa Veerasamy

Anything of depth and complexity assembles itself into networks,

just like language, economies, human knowledge and academia, cities, consciousness….”

— Visa Veerasamy

The social network LinkedIn is really interested in harnessing the power of the network.

The world stage is very difficult. It’s not easy to be on the world stage. The world is now much more difficult than it was during your revolution. It’s even more difficult. The world. More complicated, complex, difficult. It’s a spaghetti-like structure. It’s mixed up.

— Mohammad Morsi, 2012, to an American reporter, when he was president of Egypt

Hungry?

Remember what Steve Jobs said. “Stay hungry. Stay foolish.”

Let’s talk for a minute about Valve.

What the heck is Valve?

It’s a company that makes games.

It has no hierarchy at all.

How could that work, you might ask?

Let’s let one of its employees tell us about it.

Valve is different (writes an employee on his blog).

Gabe (the founder) tells it this way. When he was at Microsoft in the early 90’s, he commissioned a survey of what was actually installed on users’ PCs. The second most widely installed software was Windows.

Number one was Id’s Doom.

The idea that a 10-person company of 20-somethings in Mesquite, Texas (Id, the company that made Doom), could get its software on more computers than the largest software company in the world told him (Gabe, the founder of Valve) that something fundamental had changed about the nature of productivity.

When he looked into the history of the organization, he found that hierarchical management had been invented for military purposes, where it was perfectly suited to getting 1,000 men to march over a hill to get shot at.

When the Industrial Revolution came along, hierarchical management was again a good fit, since the objective was to treat each person as a component, doing exactly the same thing over and over.

The success of Doom made it obvious that this was no longer the case. There was now little value in doing the same thing even twice; almost all the value was in performing a valuable creative act for the first time.

In the Internet age, software has close to zero cost of replication and massive network effects, so there’s a positive feedback spiral that means

that the first mover dominates.

If most of the value is now in the initial creative act, there’s little benefit to traditional hierarchical organization that’s designed to deliver the same thing over and over, making only incremental changes over time.

So Valve was designed as a company that would attract the sort of people capable of taking the initial creative step, leave them free to do creative work, and make them want to stay. Consequently, Valve has no formal management or hierarchy at all.

How could a 300-person company not have any formal management?

It takes new hires about six months before they fully accept that no one is going to tell them what to do, that no manager is going to give them a review, that there is no such thing as a promotion or a job title or even a fixed role (although there are generous raises and bonuses based on value to the company, as assessed by peers).

That it is their responsibility, and theirs alone, to allocate the most valuable resource in the company – their time – by figuring out what it is that they can do that is most valuable for the company, and then to go do it.

That everyone on a project team is an individual contributor, doing coding, artwork, level design, music, and so on, including the leads; there is no such thing as a pure management or architect or designer role.

That any part of the company can change direction instantly at any time, because there are no managers to cling to their people and their territory, no budgets to work around.

That there are things that Gabe badly wants the company to do that aren’t happening, because no one has signed up to do them.

It’s hard to believe it works, but it does. I think of it as being a lot like evolution – messy, with lots of inefficiencies that normal companies don’t have – but producing remarkable results, things that would never have seen the light of day under normal hierarchical management.

— Michael Abrash, Ramblings in Valve Time

The artist Yayoi Kusama’s mirrored infinity rooms certainly have some …

…relation to this topic.

In the nodes of the network we see ourselves everywhere

And nowhere.

To help you think about networks, here are some exercises to try.

You can try to visualize a modified version of the graph that Matt Levine wrote about above:"Imagine building a million-dimensional graph. Each input - all of the axes but one - is some fact about the world whose future value is uncertain: the temperature this winter, the population growth in China, the price of corn, the number of homes built in Utah, the amount of rainfall in Tuscany. Each of these inputs is uncertain, and each can have an effect on the others.”

The output - the last axis, call it the "height" of the graph - is the amount of money that you will make given any set of values for each of the other 999,999 axes.

Or, alternately, the last axis is the length of your life. Or your happiness. Or anything else you like.

Next. Look at the objects in your home. Think about the path that each took to get there. Where did they come from? Imagine a diagram of all these paths.

Think about all the people you see every day, including and especially people you only see in public spaces. Remember what the Austrian communications theorist Paul Watzlawick wrote: “You can’t not communicate.” What are these people communicating to you? What are you communicating to them?

Everyone on a subway car is a networked community for a minute or two. Visualize this as a thin line joining each person to each other person.

Visualize the networks that each person is part of. Visualize the people in their networks, and the people in those people’s networks, and so on.

Your own network, and its extension.

To how many people and things are you connected? Try to visualize them.

To how many people and things are they connected? And so on, and so on.

And hang out and enjoy the network.

It’s all we really have.

Or are.