Thirty years ago, on June 8, 1989, I did the controversial public launch of ClariNet.com, my electronic newspaper business, which you could pay for and receive over the internet. There was no HTTP at the time -- it initially used USENET protocols.
In those days there was a rule against commercial use of NSFNet, which was the publicly funded backbone of the 1980s internet. I found a loophole in those rules, and convinced the manager of NSFNet that it was reasonable, and thus the first business founded to use the internet as its platform was created. I wasn't the first to want to create a business on the internet (and of course before all that there were companies working as communications providers) but I was the first to figure out how to make it happen.
This was the beginning of what would become millions of internet-based businesses. We had been predicting their rise since the 1970s in places like the Human-Nets mailing list. Human-nets, now mostly lost to history was the first online discussion system where people talked about what world-spanning computer networks meant for people and society.
Many lamented the arrival of business to the purely non-commercial internet and USENET. Most knew it was coming, for good or ill.
The history
First read this: The history of ClariNet and early business on the internet.
It was written for the 20th anniversary but you might enjoy a visit for the 30th. There were many who made it all happen in different ways, and some who did not succeed. Of course, 4 or so years later, when the Mosaic browser stabilized (and Netscape after it) the HTML web began emerging and the real boom exploded. ClariNet used HTML, but it was a paid subscription service in a world that quickly moved to ad support. Well, it sort of moved to ad support -- most in the early days did not make money from ads, they made money from the flood (tiny body today's standards) of VC investment that came. ClariNet was profitable from year one -- a mistake on my part.
There's a bunch of stuff there, but when you're back here, consider these more modern reflections on that past...
Reflections
This leads to my largest regret about how business on the internet grew over the last 30 years. Advertising remains the overwhelmingly primary way of monetizing internet activity. It's done very well for those who can tie ads to things like what you're searching for, or a detailed profile of you and all your friends, but it hasn't done very well for the 4th estate as they moved online. A small number of newspapers, such as the New York Times, Wall Street Journal and others are having some success with subscriptions and ad/subscription hybrids, but most wonder if they will be able to survive.
It wasn't ClariNet and other online news resources that killed the newspaper though. Much of that was triggered by Craigslist. Craigslist gave away basic classifieds for free, and the classified section paid a lot of the budget of the newspapers. I gave a talk at the second "Internet World" conference in 1994 where I predicted this, but of course, the newspapers weren't there, nor would they have listened if they were.
We all now know how much advertising has bent the internet to its will. As is often said, when you get something for free, you aren't the customer, you're the product. You get what you incentivize, and what advertising works on, we get -- and we get a lot less of the rest. I always hoped for a world where advertising and paid services could sit in more balance. I still hope for it, and if you look at the way that TV is changing, with ad-free services like HBO, Netflix and Amazon supplanting the old broadcast/cable ad based market, it is clear the rule is not universal. Most of these are following the model I tried to create back in 1992 with an all-you-can-eat fiction library. It was clear to me that selling individual products like articles, books, and even shows was unlikely to work due to piracy, but selling monthly services could get traction. It has certainly taken a great deal of time.
I will give credit to Google, though it is almost entirely an advertising company, for finding a way to not be beholden to its advertisers. I did a short stint inside Google while working on their car, and am friends with many within it, and I can say that they really do push their people (other than those in ad sales) to think of users instead of advertisers in designing products. Unfortunately, that is not an easy principle to follow, and even Google's own YouTube has trouble doing so.
I would love to see a social networking service compete with Facebook based on a monthly fee. A service which only worked on keeping customers happy and didn't care about advertisers. There are a few but due to the natural monopolies of social media, none have traction. Even this is not enough, because even a monthly subscription social network would still be motivated to addict you, to keep you paying each month. In addition, since a social network requires it to be trivial to get all your friends to come into the network, it can't put any impediments in their way without slowing growth. Free becomes very attractive. We are enthralled by free or the illusion of free.
(One option is to always make it free for any friend of a paying customer to join at no cost, putting modest limits on their interactions with other non-paying customers.)
This loss of money for media, be it through advertising or subscriptions is no minor matter. The powerful 4th estate helped take down Richard Nixon and many others smaller than him. Only rich newspaper owners like Katharine Graham could afford to do that and it's less clear who will do that in the years to come. It is fitting that Consumer Reports, the paragon of subscription-based consumer media, just got its largest grant in its history yesterday from Craig Newmark of Craigslist. At the same time, Graham's Washington Post is now owned by Jeff Bezos, the most successful of internet entrepreneurs. We may need more like them to maintain the balance between government and the people, though we may wish it didn't have to be billionaires.
The same is true in software and apps. Remarkably, we find it hard to pay even a few dollars for software today, if there is the potential to get it free with ads.
Serial, browsed and sampled
Another trend I lament is the decline of the serial media. For most of the history of communications, media were either serial (like newspapers, magazines, TV serials, message boards, E-mail, texts, newsgroups etc.) or browsed, like web sites, libraries and shopping. Sampled media, where you just drop your toe into a stream temporarily, came to higher prominence with Twitter and the Facebook Feed -- prior to that TV channel and radio surfing was the extent of it. With this came the decline of the serial, particularly for long-form writing. RSS (syndication) attempted to bring the serial back to the browsed world, but with limited success, and blogs and sites like this one are on the decline, particularly the idea of regular readers who at least peruse the headline of every item.
ClariNet has a very strong focus on serial publication. It relied on USENET's focus on the same, and made use of the astonishing speed with which one could quickly process material. Because USENET material was always pre-cached on your own local machine, access was always instantaneous. You could call up a page of headlines in tens of milliseconds, not hundreds or thousands of them, and yes, there is a quite noticeable difference. Your eyes could scan for possible items of interest in equally short times and you could be through immense amounts of material in under a minute. Once you saw something, it was gone -- that is the nature of the serial.
E-mail's decline (partly due to spam, but also because of its association with work and paper mail) is also a shame. Many now rely exclusively on short instant message (text) services, which win with brevity but have no mode other than "urgent, interrupt me." We've also lost much of the actual phone call, even though there are times when a modest length audio conversation is exactly the best way to communicate.
Future Trends
The internet lived up to a lot of what we talked about on Human-Nets in the 70s, and what the early business planners hoped for in the late 80s and 90s. In fact it went beyond almost everything people thought. All through it's life, there have been those who worried about negatives, and there were negatives, bt by and large, most have found it to be a positive force in the world.
We expected the internet to take over almost everything, and if it disrupted some things it would be to replace them with something better. The battle between government and the internet began with a very ill-informed government, and then briefly an enlightened one that passed surprisingly hands-off policies on censorship, taxes and site liability. But in the mid 2010s, something flipped. People now fear that the internet is breaking democracy, and in an entirely bad way. The story is far from over.
