Knowledge Networking
Knowledge Networking:
Creating the Collaborative Enterprise

David J. Skyrme


Chapter 1

Chapter 2

Chapter 3

Chapter 4

Chapter 5

Chapter 6

Chapter 7

Chapter 8

Chapter 9

Chapter 10


Chapter 1 Update

As expected, technology moves forward a pace, and there has been the dramatic rise and fall of share prices to remind us that the networked knowledge economy is one of change and uncertainty. In this update, we have not attempted to update specific tables (e.g. tables 1.1, 1.3 and the box on Internet statistics on page 19). Rather we have focussed on a trend analysis carried out by Jan Wyllie of Trend Monitor International, that confirms the main megatrends and highlights some emergent issues. There is also an update on the main technology developments.

Megatrend 1: Information and Knowledge-based

Every industry is becoming more knowledge intensive (page 12)

Increasing conflict ... before resolution

As knowledge becomes a focus throughout the economy, its form is becoming an issue of increasing concern. Data driven knowledge - as with new measurements of soil conditions leading to savings on fertilizer inputs - is often at odds with knowledge which derives from human experience.

The clashes at the WTO meeting in Seattle in 1999 indicate conflict that arises between the exponents of data driven knowledge and those with human experiential understanding. The global challenge is how the the mainly corporate interests of data driven institutional knowledge can be harmonized with human social knowledge.

Smart products and services

In the service economy, the growing interest in Customer Relationship Management (CRM) indicates that customers value the quality of relationships with suppliers. However the value of relationship based-services and of 'smart products' would be significantly increased if they really worked as promised. For example, the technical quality and security of the latest generation of smart e-commerce systems is being increasingly questioned, while in the mobile phone market WAP is being "hyped" as enabling a whole new generation of Web services now, which will not become really practical until GPRS (General Packet Radio Services) become widely available "maybe" in a couple of years. If the complexity and unreliability of new smart products and services increases, the chances that a back-to-basics, simplicity movement will increase, too.

Higher information to weight ratios

The prevailing view in the auto industry is that cars are becoming 'communications tools' by virtue of embedded multimedia devices and wireless technology. Ford and GM, for example, are busy signing alliances with Yahoo!, Oracle and Microsoft. Perhaps the expectation is that growing traffic congestion will mean that people spend more time engaged in information-based activities in cars, rather than transportation!

The next big step towards the weightless economy is expected to be m-commerce (mobile commerce) enabling people to do business and tap news and information sources anywhere they are.

Valuing intangibles

The one thing that unites data driven knowledge and knowledge based on the whole human experience is that they are both intangible - the first consists of patterns of digital electronic states, the contents of the second are states of mind entailing matters of belief. Although much important work has been accomplished in measuring the value of these kinds of intangibles (see pages 198-199) widespread implementation is still a long way off. The main way that knowledge is currently being valued is through the sentiments of the stock market, which are liable to be influenced by sentiment, and as we have seen recently is very volatile.

Megatrend 3: Globalization

Globalization is affecting more and more industries. Telecomms is one obvious example with Vodafone merging with first Airtouch (USA) and then Mannesmann (Germany) to become a global cellular service provider. There are, however, signs of a backlash from pressure groups, as witnessed by their activities at the Spring meetings of The World Bank and IMF in Washington. Perhaps what they are really against is the power of large multinationals. Yet, as the sections on 'the changing corporate landscape' and 'continual reconfiguration' indicate (pages 8-10), the Internet allows small companies to become global niche players.

Megatrend 4: The Internet

The basic trends and features (pages 17 - 20). The most interesting development is the growing interest in XML (eXtensible Markup Language). This is the latest standard for enabling different applications from different companies to interact with each other over the Internet. The creation of common definitions and schemas for XML-based e-commerce e.g. as planned by the Microsoft inspired, will simplify structured information and knowledge exchanges. It's still early days and few organizations are using XML in anger. But if Internet B2B (business-to-business) electronic exchanges and knowledge markets are going to make their mark, XML (or something very much like it) will be a necessary enabler.

Technology Trends

The price-performance of computers continues as expected. For example, 2 GHz Pentium IV multimedia PC with 100Gbyte disk for around $1500 is around the norm for mid-2002, compared with a 400 MHz, 13 Gbyte machine in 1999. The most significant developments, though, have been in telecommunications.

Wireless Telecoms / M-commerce

The Motorola-led Iridium satellite communications business (page 25) collapsed in March 2000, with billions of dollars having to be written off and the satellites being in danger of being allowed to burn up in the atmosphere. Yet, this has not dampened other developments. There is a new generation of communications satellites, known as nanosats, that weigh less than two kilos.

The big excitement (if you beleive the vendors) in the mobile arena (page 26) is the introduction of 'third generation' mobile phones which can be used as Web terminals with which to read information, as well as buy and sell goods and services. Early attempts using WAP (wireless application protocol) have proved disappointing. However, the first information and banking services are becoming available with handsets capable of making secure electronic cash payments over the existing GSM network. For example, the Finnish portal is reported signing up 7000 users a day in four countries providing paid email service, download of new ringing tone, a posting of a wireless postcard, and weather news. Options Direct became the first to launch a share trading facility via WAP in April 2000 beating TD Waterhouse to the market by a month.

General Packet Radio Service (GPRS) was starting to become available in Europe in 2001, while the date for widespread "genuine" broadband networks has been somewhat delayed. There is a pilot project in the Isal of Man, but universal availability is probably not until 2005. This technology will make mobiles into multipurpose video devices. There is a danger that the full potential of the mobile market will not be realized until the wideband service becomes more widely available.

Mobile phone technology is also seen as suffering from serious design limitations. For example, a review in Business Week concludes, "the tiny displays and painful data entry imposed by phone handsets will remain a huge impediment to success". Another serious impediment is the concerns over electro-magnetic radiation which is reported to be 30 - 60 times stronger than that emitted by computers, and according to some research can lead to serious illness, though many scientists dispute these findings. The next generation of broadband handsets are likely to emit even stronger magnetic fields which could make them a more serious health hazard. Growing youngsters are apparently most vulnerable to health hazards. Moderation, rathern than excess, seems to be the watchword.

Against this background, in the UK "frenzied" bidding pushed up the auction price for the radio spectrum for third generation mobile service to more than £ 21 billion for five licenses, more than four times the expected amount. At costs of several thousand dollars per subscriber, licence holders are now wondering when their investment is likely to be recouped. With the prices of comparable fixed line services falling rapidly as broadband capacity becomes available, the prospects for wireless data applications are perhaps less bright than they once seemed.

The Bandwidth Bonanza (Pages 26-27)

ADSL is gaining ground in the USA and in the UK, British Telecom is rolling out its broadband data ADSL (Asymmetric Digital Subscriber Line) giving subscribers a connection of 2 million bits per seconds, rather than the current 56,000 (56Kbps). ADSL will enable virtually instant Internet page loading, CD-quality audio downloads, videofilms on demand, vastly improved interactive shopping and low cost voice and video phone connections. Cheaper access to broadband services will also be available over cable networks. In the UK, Telewest has taken the lead with the launch of a high-speed cable Internet and interactive television service. Uptake among businesses has been lower than anticipated, and across the world, there are continued concerns about those out of reach of access to these services (the digital divide). Some municipalities, like Stockholm, have developed partnerships with providers to offer universal access.

Taking an overall picture, there has been a lot of investment in telecomms infrastructure - indeed, too much, since capacity on many routes far exceeds current demand. This has meant that companies like Qwest and Global Crossing, have not been able to develop viable businesses. Add to this accounting scandals at Worldcom (one of the world's leading infrasttructure suppliers) and there is uncertainty in the market. Whie bad news for suppliers, the up side for consumers is that costs are highly competitive.

As always, the problem for suppliers of new services is that of making content or functionality compelling enough to compete for people's time with television and other media e.g. mobile phones, the Internet and digital interactive television (DIT). A big success for DIT could seriously upset the business plans of Business to Consumer (B2C) Web businesses. Free interactive broadband communication with folks you know and trust will be hard to beat. It would also be the ultimate portal to the rest of the Internet.

Discussion Points

What are your views on the impacts for the networked knowledge economy of the technological developments mentioned above? In this update there are many aspects of chapter 1 that we have not addressed. Do you feel that nay of them deserve more attention in the next update?

Please email your discussion points and responses to the author at Responses will be summarized in future updates - see Feedback notes.

Additional Information

The Knowledge Connections web site provides a comprehensive resource for many topics covered in the chapter. You can also subscribe to a free monthly email briefing I3 UPDATE / ENTOVATION International news. Also make sure you check out Butterworth-Heinemann's Knowledge Management section from time to time for details of new publications and special offers.