Communities - The Role of Technology

Information and communication technology provides design options for the creation of economic value. We consider a particular architecture for the creation of economic value: the communication model of a community and its implementation in peer-to-peer computing architectures. We discuss the socio-economic model of a community, explore the social, political and economic impact of communities and describe the functions of communities and the way communities are being organized. We explore the role of technology in establishing communities and show how community models are being implemented with peer-to-peer architectures and discuss the impact for organization on industrial structures. We illustrate our approach with short cases of communities. 1. MOTIVATION AND INTRODUCTION Information and communication technology provides novel media for the creation of economic value and, in particular, for communication as part of the creation of economic value. Three basic architectures for communication (depicted in Fig. 1) can be differentiated. C C C C P/I C C C C P/I C C C C P/I P/I: Producer/ Intermediary Exchange C: Consumer unidirectional interactive multilateral Mass communication Mass customization Community Fig. 1 Communication models In mass communication, the traditional model, communication is unidirectional. Information is produced and distributed to the consumers through channels which allow hardly any feedback or consumer contribution. In mass customization, communication channels are interactive – content can be exchanged between consumer and producer/intermediary rather than transmitted from producers to consumers. In mass customization, a little feedback from the consumer enables the producer/intermediary to tailor the communication to the individual consumer. In the community model all interaction partners are able to communicate with each other. Information and communication technology refers to this architecture as peer-to-peer. All members of a community are able to participate in communication on an equal basis, i.e., as peers. Internet has a peer-to-peer architecture in the sense that every participant may initiate communication to anybody connected to this network. The World Wide Web and its technology allow everybody to publish and retrieve information. Johannes Hummel, Ulrike Lechner 2 Internet is basically a peer-to-peer architecture for communication. We argue that this has renewed communication as part of the creation of economic value. The peer-to-peer applications that facilitate peer-to-peer transactions might eventually renew the whole creation of economic value more thoroughly than peer-to-peer architectures for communication. Currently, the predominant transaction on peer-to-peer architectures is the sharing of files and in particular of mp3-files. This might eventually change. The implications of peer-to-peer architectures on the creation of economic value that the organization of industrial sectors motivates this paper and our analysis of system architectures and peerto-peer communication. Our approach is to discuss the notion of community, i.e. of peer-to-peer model for communication (Sect. 2) and the business model of community (Sect.3) with the functions of a community. We explore the role of technology for communities (Sect. 4) and show how services with peer-to-peer architectures implement the business model of community (Sect. 5). In this section, we also explore the limits of community models. In Sect. 6, we discuss the findings. 2. DEFINITIONS AND VIEWS OF “VIRTUAL COMMUNITY” The term "virtual community" refers to communities in which electronic media facilitates communication, in particular, for communities where interaction takes place on the Internet. Online community is a synonym for "virtual community". Over time, various aspects of virtual or online communities have been discussed in literature: social, political, and economic aspects. As this discussion has taken place, the perception of virtual communities has changed from a social phenomenon to a valid business model (cf, (Hummel and Lechner, 2000)). The creation of economic value in this business model results from the content and knowledge, the participants bring into the community (Timmers, 1998). The members of a community may contribute to the creation of economic value with various kinds of contributions: information, product reviews, recommendations, pieces of music, files to be shared. Virtual communities, however, provide the social and economic environment that meets human needs and the economic value that these communities contribute can hardly be separated from this context. Virtual can be viewed through a sociological, economic, or technological prism. The first sociological definitions came from Taylor and Licklider who saw the community potential of electronic networks in 1968. They described their vision of a virtual community as “...in most fields they will consist of geographically separated members, sometimes grouped in small clusters and sometimes working individually. They will be communities not of common location but of common interest...“ (Licklider and Taylor, 1968). Probably the definition of Howard Rheingold (Rheingold, 1993) is best known. He defines virtual communities as purely related to the Internet. From his point of view, virtual communities are “...social aggregations that emerge from the Net when enough people carry on those public discussions long enough, with sufficient human feeling, to form webs of personal relationships in cyberspace“ (Rheingold, 1993). Later, he also emphasizes the importance of the connection between real and virtual communities. Due to his experience with the virtual community "The well" (well.com), he sees communities as “....a group of people who may or may not meet one another face-to-face, and who exchange words and ideas through the mediation of computer bulletin boards and networks“ (Rheingold, 1994). Godwin and Jones construct their argument in a similar manner. Godwin is of the opinion “...but in cyberspace, increasingly, the dream is not just ‘owning a house’ – it’s living in the right neighborhood (Godwin, 1994)”. Jones even speaks of "virtual settlement (Jones, 1997)". Figallo later stresses the meaning of common values writing “...according to that definition, members of a community feel a part of it. They form relationships and bonds of trust with other members and with you, the community host. Those relationships lead to interactions that bring value to members” (Figallo, 1998). From the view of computer-mediated-communication, the most important elements of a virtual community are shared resources, common values, and reciprocal behavior. Whittaker et al. write in their COMMUNITIES THE ROLE OF TECHNOLOGY 3 definition “...members have a shared goal, interest, need,...engage in repeated, active participation,...have access to shared resources,...reciprocity of information,...shared context of social conventions...“(Whittaker et al. 1997). Preece extends this view to include the necessity of common rules “...an online community consists of: People, who want to interact socially..., a shared purpose...that provides a reason for the community, policies ...that guide people’s interactions (and) computer systems, to support and mediate social interaction...” (Preece, 2000). Hagel and Armstrong were the first who broke with the view of virtual communities as sociological phenomenon (Hagel III and Armstrong, 1997). They see in virtual communities a business model, which uses the possibilities of communication on the Internet to create electronic marketplaces and to increase customer loyalty. Referring to Rheingold they define virtual communities “...but virtual communities are more than just a sociological phenomenon. What starts off as a group drawn together by common interests ends up as group with a critical mass of purchasing power, partly thanks to the fact that communities allow members to exchange information on such things as a product’s price and quality”(Hagel III and Armstrong, 1997). (Hagel and Bughin, 2000) analyze the potential of communities to generate revenues. The role of technology is to provide the platform that facilitates communication and the structures that structure and organize a community with its communication. We therefore consider a technological view of communities. It comprises the constituting components of communities that are necessary to design the physical part of a community the community platform. The technological view defines a community as to be constituted by (1) a set of agents together with (2) a medium (Lechner and Schmid, 2000). Agents may be humans, software agents, organizational units – any entity that plays a role in the game of exchange and communication (Schmid, 1997).