Introduction
In "Read Write Own," Chris Dixon takes us on a journey through the evolution of the internet and presents a compelling vision for its future. The book explores how blockchain technology could reshape the digital landscape, putting power back into the hands of users and creators.
Dixon, a prominent venture capitalist and technology thought leader, argues that we're on the cusp of a new era in internet history. He calls this the "read-write-own" era, where users will have unprecedented control over their digital assets and online experiences.
The book provides a clear and accessible explanation of blockchain technology and its potential applications. It's not just about cryptocurrencies; Dixon shows how blockchain could fundamentally change how we interact online, from social media to digital marketplaces and beyond.
Let's dive into the key ideas presented in this thought-provoking book.
The Internet's Journey: From Open Frontier to Corporate Control
The Early Days: The "Read" Era (1990-2005)
Dixon begins by taking us back to the early days of the internet, a time of boundless optimism and possibility. When computer scientist Tim Berners-Lee invented the World Wide Web in 1989, he envisioned a network for sharing information and collaborating across continents and affiliations.
This period, which Dixon calls the "read" era, lasted from roughly 1990 to 2005. It was characterized by the development of internet protocol networks that democratized information sharing. For the first time in history, anyone with an internet connection could access a vast wealth of information from anywhere in the world.
The power of this era lay in its openness and decentralization. You didn't need to own a television station or a printing press to reach a global audience. Anyone could create a webpage that was instantly accessible worldwide. This openness was seen as the foundation for a new, more empowered, and more democratic society, immune from centralized control and censorship.
Early internet pioneers were a diverse group of mavericks, hippies, entrepreneurs, and iconoclasts. They flocked online to create this new digital society that was free and empowering. The internet was a wild frontier, ripe with possibilities and unburdened by corporate control.
The Rise of Big Tech: The "Read-Write" Era (2006-2020)
However, this utopian vision didn't last. Dixon explains how the internet gradually transformed into what he calls the "read-write" era, lasting roughly from 2006 to 2020. This period saw the rise of social media platforms and other services that allowed users not just to consume content, but also to create and share it easily.
Platforms like Facebook, Twitter, YouTube, and others flourished by enabling anyone to write and publish content that could reach mass audiences. This was a significant shift from the "read" era, as it gave average internet users powerful tools to become publishers and creators themselves.
But this new functionality came at a cost. These "read-write" services were part of a centralized, corporate-controlled model. While they provided users with unprecedented ability to create and share content, they also extracted the ownership and economic value created through all this user-generated content.
Over time, big tech companies began to dominate the internet, imposing their rules and extracting value from popular use of their platforms. Facebook, Google, Amazon, and a few others became the new gatekeepers of the digital world, stifling competition and innovation.
Dixon likens this process to an empire annexing autonomous villages. These Big Tech platforms have swallowed the vibrant ecosystems that nurtured early online life. The spirit that animated the web's early days has been threatened, as users find themselves increasingly at the mercy of corporate policies and profit motives.
The "Attract and Extract" Model
Dixon introduces the concept of the "attract and extract" model to explain how these tech giants operate. In the early days of a platform, the focus is almost solely on growth – this is the "attract" phase. During this stage, the platform tends to be generous, open, and permissive, offering the best possible deal to users.
Once the growth curve starts to mature and a user base is established, the company moves to the next phase: "extract." Now with a captive audience, the strategy changes to squeezing out as much revenue as possible from users. This can be done by erecting paywalls, charging for features, or ramping up advertising.
The result is a system where users create content that generates value, but that value is largely captured by the platform owners. Facebook, for instance, pockets virtually all the profits generated from user content – a staggering 99% take rate.
Enter the Blockchain: A New Hope for Digital Ownership
The Promise of Blockchain Technology
As Dixon paints this somewhat gloomy picture of the current internet landscape, he introduces blockchain technology as a potential game-changer. Blockchain, he argues, could be the key to shifting power away from centralized chokepoints and back into the hands of communities.
Blockchain technology arose from a paper published in 2008 by the mysterious Satoshi Nakamoto. It described a decentralized network of computers that could transfer value without central authorities. The core innovation was the blockchain itself: a shared virtual computer running on many devices that maintains a canonical record of transactions.
Unlike traditional centralized networks, blockchains have no single owner. The software protocol itself is in charge, running immutably according to hard-coded and transparent rules. This tamper-resistance makes blockchains ideal for building open networks and makes the commitments they enable more reliable.
Tokens: The Building Blocks of the New Internet
Dixon introduces the concept of tokens as the fundamental building blocks of this new blockchain-based internet. He likens tokens to Lego blocks for the digital world – simple components that developers can combine in novel ways to create complex systems.
There are two main types of tokens:
Fungible tokens: These are like currencies – interchangeable units that can be swapped back and forth. The most prominent example is Bitcoin. But fungible tokens can represent anything from airline miles to computational resources on a cloud computing network.
Non-fungible tokens (NFTs): These are unique, irreplaceable individual units, more like collectibles. Each NFT represents a specific asset, like a piece of digital art, a music file, a video clip, or even a plot of virtual land.
These tokens enable a breakthrough in digital ownership. For the first time, users can truly own digital assets in a way that mimics ownership in the physical world. They can hold these assets securely without intermediaries, trade them freely, and carry them across different platforms and applications on the internet.
Applications of Blockchain Technology
Dixon explores various ways blockchain technology and tokens can be used to create new types of online experiences and economies:
Decentralized Finance (DeFi): Blockchain enables the creation of financial systems that operate without traditional banks or intermediaries. Users can lend, borrow, and trade directly with each other, often at better rates than traditional financial institutions offer.
Digital Art and Collectibles: NFTs have opened up new possibilities for artists and creators to monetize their work. They can sell unique digital artworks or limited edition collectibles directly to fans, with ownership securely recorded on the blockchain.
Virtual Worlds and Gaming: Blockchain technology allows for the creation of virtual worlds where users truly own their in-game assets. These assets can often be traded or used across different games and platforms.
Social Networks: Blockchain-based social networks can give users more control over their data and content. They can also provide more direct monetization opportunities for creators.
Decentralized Autonomous Organizations (DAOs): These are organizations run by rules encoded as computer programs on a blockchain. They allow for new forms of collective decision-making and resource allocation.
The "Read-Write-Own" Era: A New Chapter in Internet History
Dixon argues that we are now entering a third era of the internet: the "read-write-own" era. This new phase is characterized by broader ownership of digital goods on distributed platforms, spreading economic benefits and governance rights to communities of users themselves.
In this new era, users won't just be able to read content online or write and share their own content. They'll be able to truly own their digital assets and have a say in how the platforms they use are governed.
Disrupting the Disruptors
One of the most exciting aspects of this new era, according to Dixon, is its potential to challenge the dominance of current tech giants. He draws a parallel to how Amazon disrupted traditional bookstores by leveraging the internet's lower cost structure to undercut competitors.
Now, blockchain-based platforms are poised to do the same to today's tech giants. By dramatically reducing transaction costs and eliminating middlemen, these new platforms can offer better deals to both creators and consumers.
For example, blockchain-based music streaming platforms like Audius allow artists to upload songs and get paid directly by listeners. Since payments occur on the blockchain, artists receive virtually all of the revenue, minus a small transaction fee. This is in stark contrast to traditional streaming platforms, which often pay artists only a tiny fraction of the revenue their music generates.
Similarly, LBRY offers a decentralized alternative to video sharing platforms. Creators can post footage to the LBRY blockchain network and set their own prices per stream. Viewers connect directly to LBRY to stream videos, making payments behind the scenes. There's no corporate owner claiming advertising or data revenue – just a direct exchange between creators and fans.
Aligning Incentives
By aligning incentives in this new way, blockchain networks encourage innovation and creativity. They exemplify an emergent generation of community-owned platforms, leaving less room for monopolistic middlemen to extract disproportionate profits.
This shift in incentives is already having an impact. Dixon notes that in just one year, over $30 billion was invested in building financial applications on Ethereum, one of the leading blockchain platforms. Developers are flocking to these new technologies, attracted by the opportunity to build more open, inclusive, and value-aligned internet services.
Challenges and Concerns
While Dixon is largely optimistic about the potential of blockchain technology, he doesn't shy away from discussing the challenges and concerns associated with it. Some of the issues he addresses include:
Scalability: Many blockchain networks currently struggle to handle large numbers of transactions quickly and efficiently. This is an area of active research and development.
User Experience: Blockchain applications can be complex and intimidating for average users. Improving user interfaces and experiences is crucial for widespread adoption.
Regulatory Uncertainty: The legal and regulatory landscape for blockchain and cryptocurrencies is still evolving, which can create uncertainty for businesses and users.
Environmental Concerns: Some blockchain networks, particularly those using "proof of work" consensus mechanisms, have been criticized for their high energy consumption.
Security and Scams: While blockchain technology itself is highly secure, the ecosystem around it has been plagued by hacks, scams, and fraudulent projects.
Dixon argues that these challenges, while significant, are not insurmountable. He points to ongoing research and development efforts aimed at addressing these issues, and expresses confidence that solutions will be found as the technology matures.
The Road Ahead
As Dixon looks to the future, he sees a world where blockchain technology has become an integral part of our digital lives. He envisions a more open, transparent, and user-centric internet where individuals have greater control over their data, their digital assets, and their online experiences.
Some of the developments he anticipates include:
Interoperability: As standards emerge, tokens built for different systems will be able to interoperate, enabling exciting combinations. For example, tokens representing a piece of NFT art could unlock new powers in a blockchain-based game.
Identity and Credentials: Blockchain could enable new forms of digital identity and credential verification. A token attesting to someone's credentials might give them discounts or access across many decentralized applications.
Governance Innovation: DAOs and other blockchain-based governance systems could lead to new ways of organizing and making collective decisions, both online and in the physical world.
Tokenization of Real-World Assets: Beyond purely digital assets, blockchain could enable the tokenization and fractionalization of real-world assets like real estate or fine art, making these investments more accessible to average people.
New Economic Models: Blockchain could enable entirely new economic models, from micro-payments for content consumption to complex incentive systems for contributing to open-source projects.
Conclusion: A Call to Action
Dixon concludes "Read Write Own" with a call to action. He argues that the future of the internet is not set in stone, and that we all have a role to play in shaping it.
He encourages readers to:
Learn More: Stay informed about blockchain technology and its potential applications. Understanding these developments is crucial for making informed decisions about our digital future.
Experiment: Try out blockchain-based applications and services. Experience firsthand what it's like to truly own your digital assets or participate in a decentralized organization.
Contribute: For those with technical skills, consider contributing to open-source blockchain projects. For others, participate in blockchain-based communities and help shape their development.
Advocate: Push for policies and regulations that support innovation in this space while protecting users and addressing legitimate concerns.
Imagine: Think creatively about how blockchain technology could be used to solve problems or create new opportunities in your field or community.
Dixon's vision for the future internet is one of empowerment and possibility. He sees blockchain technology as a tool that can help us reclaim the original promise of the internet – a decentralized network that empowers individuals and fosters innovation.
The internet began as an open frontier for innovation, but over time has consolidated under the control of tech titans. These powerful centralized intermediaries attract users with platforms that are open initially, only to later exploit their audience to extract disproportionate profits.
Blockchain technology offers an alternate future for online economies and social structures. It empowers users through direct ownership of digital assets and shared governance. In this new paradigm, value flows not to distant corporate coffers but into the pockets of creators and contributors themselves.
As we stand at the threshold of this new era, Dixon's book serves as both a guide and an inspiration. It challenges us to imagine and build a better internet – one where we can all read, write, and truly own our digital lives.
The seeds have been planted for web 3.0 and beyond. It's now up to us to nurture this fertile soil and shape the digital world we want to inhabit. As Dixon might say, the future is not just something that happens to us – it's something we create. And with blockchain technology, we have a powerful new tool to help us build that future.