Electric Communities : Commerce and Society in Cyberspace

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Electric Communities: Commerce and Society in Cyberspace Pag

http://www.crockford.com/ec/commerce_society.html 08/09/2004 11:39:58

System developers in the social arena are oblivious and often hostile to commerce insocial Net environments. And system developers in the business arena ignore the socialdimensions of Net commerce. Existing online systems, as well as those expected to comeonline in the next few years, reflect these biases, and therefore fail to support the range ofhuman interactions necessary to fully realize the electronic marketplace.

Before Cyberspace

Current systems share the following problems:

They do not provide a robust environment for business.They do not provide a compelling environment for socializing and entertainment.They are unable to react to the growth and diversity of the Net population.

The lack of commercial and social infrastructure in the Internet inhibits its functionalityto an extraordinary degree.

An environment for business

Cyberspace is atelecommunicationsframework with asense of place as itsmost criticalcomponent.

Electronic commerce via the Net is often conceived in terms of providing a way for acustomer to pay a vendor through the Net. This approach usually entails encrypting acredit card number to protect it from computer criminals as it travels across the Net. Arobust payment system is essential, but that's just the tip of the iceberg, and one of theleast challenging technical issues to address. Banks have been doing businesselectronically among themselves for years and so a consumer payment solution could beadapted from the banking system. But commerce requires more than just protecting acredit card number.

In the real world, commerce takes place within social and legal institutions for which fewanalogs exist in the digital world. Real world commerce depends on constraints imposedby the physical world-such constraints do not exist in cyberspace.

The real world has real places. So when a customer buys a pair of pants at Macy's whichturn out to be defective, he can return them. This is because Macy's has a return policy,and also because Macy's has a persistent presence and a persistent identity. Macy's willbe in the same place next week as it was today. The customer knows that he can go back,and Macy's knows he knows. When he goes to the store he will find clerks to whom hecan talk, and there's a manager to enforce Macy's policies if there is a dispute. Macy's

also exists within a legal and governmental framework. Macy's can also have courtjudgements enforced against it by the police power of the State. Macy's also hasrelationships with suppliers, banks, other customers, consumer organizations, and laborunions, relationships that also serve to validate its credibility and anchor its presence inreality.

The Net is different. Business on the Net today takes place between two electronicaddresses. An electronic address is designed to route messages for delivery to computers.An address is fed to a machine and the message disappears into the Net, beyond anyone'sability to control or even know where it actually goes. Later a message may come back

Encryption is theprocess ofscrambling amessage in order tohide its contents.


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from somewhere out there, coming, again, from places unknown. This is the way the Networks. To have the same confidence in the Net that we have with Macy's will requirenew mechanisms in the Net that provide persistent place, reputation verification, anddispute resolution.

Privacy and confidence

Much of the privacy that people take for granted in the real world is protected mainly bythe logistical inconvenience of bringing someones records, from different companiesand organizations, together in one place so that they may be examined for patterns. Anysingle piece of information about someone may be innocuous, but when multiple sets ofrecords from several sources are combined they may reveal a picture that is much moreinvasive. Intelligence agencies have known this for years, but as long as the practice wasexpensive and time consuming, abuse was limited. But now that these analysiscapabilities are becoming inexpensive and widely available, any interaction can reveal agreat deal of personal information.

The problem is worse on the Net because all information on the Net is in digital form.People using the Net can't control how personal information about them is used.Tendering credentials between parties is a key feature of commerce, but the Net lacks amechanism for verifying reputation without revealing more than is necessary.

Commerce requires a secure, reliable financial model with the means to authenticate theorigin of the information exchanged. There needs to be a method for accumulatingreputation information so that the contacts and relationships on which all businessdepends can be established and maintained. There needs to be a contractual and legalframework for doing business, and there must be a framework for the resolution ofdisputes. All of this is completely lacking in the present batch of online commercesystems.

The Net as a social environment

Efforts to treat the Net as a social space have been more successful than efforts toestablish it as a commercial space. The Internet's booming population confirms this. Butthe Internet was created by nerds for nerds. It is relatively well adapted to the needs of itscreators, but these people are not representative of the rest of society. Developments onthe Net have raced ahead without taking the time to get it right. The Net's frivolouscomplexity, technical obscurity, and general unreliability must be eliminated if there is to

be a worldwide online society.

Digital informationcan easily becopied, stored,sorted, processed,and manipulated.

A sense of community is profoundly enhanced if the members of a group are able toassemble in a way that gives them a sense of place. Online technologies which allowpeople to interact in a shared, persistent place foster the strongest social bonds. Onlinechat systems with everyone chatting at the same time, in the same space, are a poormodel for social interaction. Telephone conference calls are even more ephemeral; itwould not occur to anyone to label them "a community." But Usenet newsgroups developa sense of community, even though they are basically just topic headings. This sense ofcommunity arises because newsgroups have persistence, and because the group of people

Usenet is a large setof discussiongroups which arecomposed of thecollectedcontributions of itsreaders. It includesa huge variety oftopics.


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The solution to the problems of growth is a software architecture that scales well. Inprinciple, this is simply a matter of systematically requiring that designs not containintrinsic bottlenecks. A bottleneck-free design is every engineer's ideal. In practice,however, implementation is extremely difficult. It is easier to centralize functionsbecause this makes analysis of the system more approachable. Engineers typically

estimate some upper limit past which the system is not expected to grow, and ignorepotential bottlenecks which arise only beyond this limit. This practice is effective as longas the growth estimates are accurate and the margins for error in the design areconservative. But this sort of planning process has difficulty on the Net. The expandinguser population constantly comes up with new and unexpected ways to push the outsideof the envelope. As the number of unanticipated applications grows, the overall utility ofthe Internet grows, therefore attracting more users. Since the whole process is pumpedby innovation, it is impossible to forecast the direction of growth. A more effectivedesign principle is to assume unbounded growth. But incorporating the expectation ofunbounded growth is a very difficult intellectual task. Architects of the current Internetinfrastructure merely settle for half measures and tolerate the enormous expense and

inconvenience inherent in a series of escalating crises, rather than confronting the realproblem.

Bottlenecks areresource or

performanceconstraints thatlimit the growth ofsome aspect of thenetwork.

For example, the crisis of the moment on the Internet is that InterNIC, which coordinatesthe allocation of IP addresses and domain names, is drowning under a torrent ofapplications for IP address space. This single small organization has become a bottleneckin the growth of the worldwide Internet because a critical administrative function wascentralized back in the days when the entire job could be handled by one secretary. Thedays when the task was small and easily managed are long gone, but the function itselfremains stuck in a centralized design.

There are organizations which have taken scaling problems seriously. Most notable arethe telephone companies. They deal in infrastructure whose size scales with thepopulation as a whole. Although they tend to be large, highly centralized organizations,the technical systems which they maintain are decentralized and redundant.

A New Architecture for Cyberspace

What is needed is a new architecture for the Net that enables social and commercialinteraction and can serve the needs of the entire population of the planet. The newarchitecture must be:

Decentralized

Decentralization is the best solution to problems of global scale. The Internet is a goodexample of technical decentralization. In order to adequately serve everyone on theplanet, the Net must also be decentralized administratively, creatively, andentrepreneurially.

Open

IP: InternetProtocol


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The Net must be an open system free of proprietary restrictions. This allows anyone ableto work within the open and published software specification to provide new services.This is the surest way to encourage creative innovation in the Net.

Portable

The service should work over virtually all network configurations and all hardwareplatforms. This would include everything from supercomputers and massive servers toPDAs, Cable TV set top boxes, and game machines.

Secure

Security mechanisms are required to provide protection against fraud and abuse, and addrobustness to the decentralized architecture. Security is not a feature, it is a designrequirement.

A new open standard

Placing the fundamental Net protocols into the public domain is the best way to create anopen standard. And wide adoption of an open standard requires that the standards reviewbe public. The adoption of new standards is a bottom-up process, which means that thearchitecture must be compatible with and should build on top of the existing standards.

The components of the new architecture must be software which can be adoptedincrementally, so that the whole world need not convert to these standards before they doany good.

A new commercial infrastructure

To support a commercial environment requires that we incorporate the elements of thereal commercial world-not only money and financial services, but the entire commercialinfrastructure. This requires an electronic credentials mechanism and a way of handlingreputation information, as well as mechanisms for contract negotiation, contractenforcement, and dispute adjudication. Directory services are also required so that peopleand companies can find one another in the first place.

A new social environment

A social environment recognizes that the inhabitants of cyberspace are human beings andprovides them with the means to interact with each other, rather than just with machinesor with data. The key to this is to provide a sense of place: a persistent environmentwhich can be shaped by its inhabitants. We also need to recognize that people speakdifferent languages and provide support for this, both for the encoding of differentlanguages and for services which translate between them.

We should maintain continuity with the real-world legal and ethical traditions whichallow civil society to exist, acknowledging the principles which have driven the


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evolution of civilization. In particular, many of the ideals embodied in various bills ofrights and other statements of principle can be embodied in the very technological fabricof the Net, lending them a solidity comparable to physical law.

Law and order in cyberspace

Both the commercial and the social features of the Net require that it be secure. In part,this means that communications should be proof against both tampering andeavesdropping. This requires end-to-end encryption of communications links andcryptographic authentication of messages and data. To be truly secure, however, does notjust mean layering a veneer of cryptography on top of an otherwise ordinarycommunications architecture. Security is a characteristic that must be designed into thefoundation level semantics of the system.

Meeting these goals in a way that preserves the sort of flexibility needed to allow futuregrowth is a significant challenge.

A new object model

These goals can be met by building on top of an open, dynamically extensible system ofcommunicating objects. These objects must be persistent, distributed, and transportable.

Persistence allows places in the Net to have an objective existence independent of itsinhabitants and allows long-term relationships to flourish.

Distribution allows multiple participants to influence the behavior of an object sharedacross the Net.

Transportability allows information to be communicated in the form of active objectsrather than mere passive data. This is important when objects embody relationshipsbetween, for example, parties to a commercial transaction. For communication to bepossible, there must be a common set of primitive data formats which are universallyunderstood. To do this securely requires that these objects be represented in a form thatallows their important security properties to be proven automatically, and which allowstheir other important properties to be certified by independent validation services. Ifobjects embodying executable software are to be moved from one place to another in theNet, there must be assurance that there is no threat from viruses or hostile programs.

No dependence on hardware

The implementation must be independent of the technical details of the underlyingtransport media and relatively independent of the applications to which it is beingapplied. There should not be requirements for particular types of transmissiontechnology, bandwidth, latency, or other characteristics of the communications medium.All that should be required is that, within some tolerable bounds of reliability, theunderlying medium gets the bits from one place to another and back again. Similarly, weshould not establish any requirements regarding user interface. No one interface is likely

Objects are acomputer

programmingconvention whichcombines a closelyrelated setof datawith the

programmaticbehaviors which acton those data.


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to be ideal for all applications, nor is any interface today able to anticipate futuredevelopments in interface or application design.

How To Do It

Much of what is required to achieve this vision of the Net exists today, or is quicklycoming into existence. What is lacking is software, the computer programs that willcreate the secure and open network marketplace. The necessary software is called aCyberspace Operating System. It realizes a suite of Cyberspace Protocols, which provideconventions for communicating through the Net.

A Cyberspace Operating System implements an object model based on unums. Unumsare objects which are shared by many computers across the network. It is not necessaryfor any one computer to know or understand the complete state or behavior of a unum.This makes it possible to think of the unum as existing in the Net. The unum is thebuilding block used to construct shared persistent places.

Unums are programmed, so there can be a large variety of them, specialized to satisfyspecific purposes. The Cyberspace Protocols predefine special sets of unums that areessential to the operation of the marketplace. These include

Basic Set - defines a set of standard, essential, general-use unum classes for structuring avirtual world and navigating within it.

The Basic Set could be used to create a representation of a bank.

Certificate Set - defines certificate unums, which contain a cryptographicallyauthenticated binding between some information and some certifying identity.

A Certificate, issued by a chartering institution, would identify the bank.

Directory Set - specifies unums for directory services, so that services in the Net thatwish to make themselves known can do so and so that customers searching for servicescan find them.

A bank could be located in the Net by a Directory service.

Financial Set - specifies unums for financial activity, enabling the creation of a variety ofdigital financial instruments. In particular, it will directly provide for digital money in anumber of forms.

The bank's customers could write electronic checks.

Credentials Set - specifies unums for dealing with digital credentials and other forms ofreputation information.

Customers can check the bank's credentials.


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Unum Validation Set - specifies unums, protocols and procedures for validation servicesthat independently certify the trustworthiness of unums.

Critical software can be delivered through the Net without exposing the recipient

to the threat of digital viruses.

Contract Set - specifies unums for the negotiation and management of contractualrelationships.

An important class of contracts can be negotiated and enforced electronically

and inexpensively.

Juridical Set - specifies unums for the adjudication of disputes between parties in the Net,especially with regard to commitments and actions associated with contracts.

Disputes can be resolved inexpensively, almost automatically.

Linguistic Set - specifies unums for the provision and use of language translationservices.

The Net is global. It should be easy to locate and contract for translation

services.

Unums are made from communicating objects, much as molecules are made from atoms.Communicating objects provide secure semantics which allow transmitting chucks ofprogram matter all over the Net without exposing people to the threat of viruses andother dangers.

The Cyberspace Protocols, including the specifications for the Unum andCommunicating Object Models, will be placed into the public domain in order toencourage rapid independent implementation and adoption of the Protocols.

Commerce in the Net

There is tremendous interest in public digital networks. There is justifiable confidencethat it will quickly mature into a significant medium for commerce. In order for the Netto achieve its potential, the commercial foundation of the Net must provide more thanjust a payment system. It so requires support of necessary services such as softwarevalidation, contracts, and dispute resolution, and most importantly, the Net needs supportfor social interaction and community formation. Most commerce in the real worlddepends on relationships between people. In this respect, the Net is no different.

The Cyberspace Protocols augment the communications infrastructure, adding thecapabilities which transform the Net from a network of networks into a network ofmarketplaces and communities. The Protocols are designed to serve the needs of largebusinesses, small businesses, and individuals.


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Electric Communities: Commerce and Society in Cyberspace Page

http://www crockford com/ec/commerce society html 08/09/2004 11:39:58

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Electric Communities : Commerce and Society in Cyberspace

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