The Power of Decentralization
The atom is the icon of the 20th century. The atom
whirls alone. It is the metaphor for individuality. But the atom is the
past. The symbol for the next century is the net. The net has no
center, no orbits, no certainty. It is an indefinite web of causes. The
net is the archetype displayed to represent all circuits, all
intelligence, all interdependence, all things economic, social, or
ecological, all communications, all democracy, all families, all large
systems, almost all that we find interesting and important. Whereas the
atom represents clean simplicity, the net channels messy complexity.
The net is our future.
Of all the endeavors
we humans are now engaged in, perhaps the grandest of them all is the
steady weaving together of our lives, minds, and artifacts into a global
scale network. This great work has been going on for decades, but
recently our ability to connect has accelerated. Two brand-new
technological achievementsthe silicon chip and the silicate glass
fiberhave rammed together with incredible speed. Like nuclear
particles crashing together in a cyclotron, the intersection of these
two innovations has unleashed a never-before-seen force: the power of a
pervasive net. As this grand net spreads, an animated swarm is
reticulating the surface of the planet. We are clothing the globe with a
The dynamic of our society, and
particularly our new economy, will increasingly obey the logic of
networks. Understanding how networks work will be the key to
understanding how the economy works.
Any network has
two ingredients: nodes and connections. In the grand network we are now
assembling, the size of the nodes is collapsing while the quantity and
quality of the connections are exploding. These two physical realms, the
collapsing microcosm of silicon and the exploding telecosm of
connections, form the matrix through which the new economy of ideas
A single silicon transistor today can only be seen in a microscope. In a
few years it will take a microscope to see an entire chip of
transistors. As the size of silicon chips shrinks to the microscopic,
their costs shrink to the microscopic as well. In 1950 a transistor cost
five dollars. Today it costs one hundredth of a cent. In 2003 one
transistor will cost a microscopic nanocent. A chip with a billion
transistors will eventually cost only a few cents.
this means is that chips are becoming cheap and tiny enough to slip
into every object we make. Eventually, every can of soup will
have a chip on its lid. Every light switch will contain a chip. Every
book will have a chip embedded in its spine. Every shirt will have at
least one chip sewn into its hem. Every item on a grocery shelf will
have stuck to it, or embedded within itself, a button of silicon. There
are 10 trillion objects manufactured in the world each year and the day
will come when each one of them will carry a flake of silicon.
This is not crazy, nor distant. Ten years ago the notion that all doors
in a building should contain a computer chip seemed ludicrous, but now
there is hardly a hotel door in the U.S. without a blinking, beeping
chip in its lock. These microscopic chips will be so cheap well
throw them away. Thin slices of plastic known as smart cards now hold a
throwaway chip smart enough to be your banker. If National Semiconductor
gets its way, soon every FedEx package will be stamped with a disposable
silicon flake that smartly tracks the contents of the package on its
journey. And if an ephemeral envelope can have a chip, so can your
chair, each bag of candy, a new coat, a basketball. Soon, all
manufactured objects, from sneakers to drill presses to lamp shades to
cans of soda, will contain a tiny sliver of embedded thought.
And why not?
Today the world is populated by 200 million computers. Andy Grove of
Intel happily estimates that well see 500 million computers by
2002. Yet for every expensive chip put into a beige computer box, there
are now 30 other cheap processors put into everyday things. The number
of noncomputer chips already pulsating in the world is 6
billionone chip for every human on Earth.
Network organizations experience small gains while thieir
network is being seeded. Once the network is established, explosive
growth follows with relatively little additional genius.
You already have a non-PC chip embedded in your car and stereo and rice
cooker and phone. These chips are dumb chips, with limited ambitions. A
chip in your cars brakes doesnt have to do floating-point
math, spreadsheets, or video processing; it only needs to brake like a
Because they have limited functions and can be produced in great
quantity, these dumb chips are ultracheap to make. One industry observer
calculated that an embedded processor chip costs less to manufacture
than a ball bearing. Since they can be stamped out as fast and cheap as
candy gumdrops, these chips are known in the trade as "jelly
beans." Dumb, cheap jelly bean chips are invading the world far
faster than PCs did.
This is not surprising. You can only use one or two personal computers
at a time, but the number of other objects in your life is almost
unlimited. First, well put jelly bean chips into high-tech
appliances, then later into all tools, and then eventually into all
objects. If current rates continue therell be some 10 billion tiny
grains of silicon chips embedded into our environment by 2005.
Putting a dot of intelligence into every object we make at first gives
us a billion dimwitted artifacts. But we are also, at the same time,
connecting these billion nodes, one by one.
connecting everything to everything.
There is something
mysterious that happens when we take large numbers of things that are
fairly limited and connect them all together. When we take the dumb chip
in each cash register in a store and link them into a swarm, we have
something more than dumb. We have real-time buying patterns that can
manage inventory. If we take the dumb chips that already regulate the
guts of an automobile engine, and let them communicate an engines
performance to the mechanic of a trucking firm, those dumb chips can
smartly cut expensive road repairs. (Mercedes Benz recently announced it
is planning to embed a web server into its top-of-the-line model cars so
technicians can spot service problems remotely.) When connected into a
swarm, small thoughts become smart.
When we permit any
object to transmit a small amount of data and to receive input from its
neighborhood, we change an inert object into an animated node.
It is not necessary that each connected object transmit
much data. A tiny chip plastered inside a water tank on an Australian
ranch transmits only the telegraphic 2-bit message of whether the tank
is FULL or NOT. A chip attached to the ear of each steer on the same
ranch beams out his location in GPS numbers; nothing more.
"Im here, Im here" it tells the ranchers log
book; nothing more. The chip in the gate at the end of the
ranchers road communicates only a single word, reporting when it
was last opened: "Tuesday."
It does not take sophisticated infrastructure to transmit these dumb
bits. Stationary objectsparts of a building, tools on the factory
floor, fixed camerasare wired together. The nonstationary
restthat is, most manufactured objectsare linked by infrared
and radio, creating a wireless web vastly larger than the wired web. The
same everyday frequencies that run garage door openers and TV remote
controls will be multiplied by the millions to carry the dumb messages
of connected objects.
The glory of these connected crumbs is
that they dont need to be individually sophisticated. They
dont need speech recognition, artificial intelligence, or fancy
expert systems. Instead, the network economy relies on the dumb power of
bits linked together into a swarm.
Our brains tap into dumb
power by clumping dumb neurons into consciousness. The internet banks on
dumb power by connecting dumb personal computers. A personal computer is
like a single brain neuron in a plastic box. When linked by the telecosm
into a neural network, these dumb PC nodes create that fabulous
intelligence called the World Wide Web.
Again and again we
see the same dynamic at work in other domains: Dumb cells in our body
work together in a swarm to produce an incredibly smart immune system, a
system so sophisticated we still do not fully comprehend it.
Dumb parts, properly connected into a swarm, yield smart
A trillion dumb chips connected into a hive
mind is the hardware. The software that runs through it is the network
economy. A planet covered with hyperlinked chips is shrouded with waves
of sensibility. Millions of moisture sensors in the fields of farmers
shoot up data, hundreds of weather satellites beam down digitized
images, thousands of cash registers spit out bit streams, myriad
hospital bedside monitors trickle out signals, millions of web sites
tally attention, and tens of millions of vehicles transmit their
location code; all of this swirls into the web. That matrix of signals
is the net.
The net is not just humans typing at one another on AOL, although that
is a part of it and will be as long as seduction and flaming are
enjoyable. Rather, the net is the total collective interaction of a
trillion objects and living beings, linked together through air and
This is the net that begets the network economy. According to MCI, data
traffic on the global phone system will soon overtake voice traffic. The
current total volume of voice traffic is 1,000 times that of data, but
in three years that ratio will flip. ElectronicCast estimates data
trafficthe talk of machineswill be ten times voice traffic
by 2005. That means that by 2001 most of the signals zipping around the
Earth will be machines talking to machinesfile transfers, data
streams, and the like. The network economy is already expanding to
include new participants: agents, bots, objects, and servers, as well as
several billion more humans. We wont wait for AI to make
intelligent systems; well do it with the swarm power of ubiquitous
computing and pervasive connections.
The surest way to
smartness is through massive dumbness.
The surest way
to advance massive connectionism is to exploit decentralized
forcesto link the distributed bottom. How do you build a better
bridge? Let the parts talk to one another. How do you improve lettuce
farming? Let the soil speak to the farmers tractors. How do you
make aircraft safe? Let the airplanes communicate among themselves and
pick their own flight paths. This decentralized approach, known as
"free flight," is a system the FAA is now trying to institute
to increase safety and reduce air-traffic bottlenecks at airports.
Mathematical problems which were once intractable for super-computers
have been solved by using a swarm of small PCs. A very complex problem
is broken up into tiny parts and distributed throughout the network.
Likewise, vast research projects that would tax any one institution can
be distributed to an ad hoc network. The Tree of Life is a worldwide
taxonomic catalog of all living species on Earth administered on the
web. Such a project is beyond the capabilities of one person or group.
But a decentralized network can produce the necessary intelligence. Each
local expert supplies their own data (on finches, or ferns or jellyfish)
to fill in some of the blanks. As Larry Keely of the Doblin Group says,
"No one is as smart as everyone."
Any process, even the bulkiest, most physical process, can be tackled by
bottom-up swarm thinking. Take, for example, the delivery of wet cement
in the less-than-digital economy of rural northern Mexico. Here Cemex
(Cementos Mexicanos) runs a ready-mix cement business that is
overwhelming its competitors and attracting worldwide interest. It used
to be that getting a load of cement delivered on time to a construction
site in the Guadalajara region was close to a miracle. Traffic delays,
poor roads, contractors who werent ready when they said they would
be, all added up to an on-time delivery rate of less than 35%. In
response, cement companies tried to enforce rigid advance reservations,
which, when things went wrong (as they always did), only made matters
worse ("Sorry, we cant reschedule you until next
Cemex transformed the cement business by
promising to deliver concrete faster than pizza. Using extensive
networking technologyGPS real-time location signals from every
truck, massive telecommunications throughout the company, and full
information available to drivers and dispatchers, with the authority
to act on itthe company was able to promise that if your load
was more than 10 minutes late, you got a 20% discount.
Instead of rigidly trying to schedule everything ahead of time in an
environment of chaos, Cemex let the drivers themselves schedule
deliveries ad hoc and in real time. The drivers formed a flock of trucks
crisscrossing the town. If a contractor called in an order for 12 yards
of mix, the available truck closest to the site at that time would make
the delivery. Dispatchers would ensure customer creditworthiness and
guard against omissions, but the agents in the field had permission and
the information they needed to schedule orders on the fly. Result:
On-time delivery rates reached about 98%, with less wastage of hardened
cement, and much happier customers.
Similar thinking has been used in a GM paint plant in Fort Wayne,
Indiana. The wonderful choice of colors that customers now enjoy on new
vehicles was playing havoc on the paint line. When one car after another
is sprayed black, everything is easy. But when one car is red and the
next white, the painting process is slowed down as painting equipment is
cleansed of one color to make it ready for the next. (The clean-out
procedure also wastes paint left in the paint lines.) Why not gang up
all the white cars and do them together? Because ganging up slows the
line. A car has to be built and completed as it is ordered, as quickly
as possible. The solution embraces the swarm.
In the paint factory each robot painter (basically a dimwitted painting
arm) is empowered to bid on a paint job. If it is currently painting red
and a car slated to be red is coming down the assembly line, it says,
"Let me do it," and it beckons the car to its paint station.
The robots schedule their own work. They have very tiny brainlets,
connected to a server. No central brain coordinates; the schedule comes
from the swarm of mini-brains. The result: GM saves $1.5 million a year.
The equipment requires less paint (due to less cleaning between cars),
and keeps the line moving faster.
Railways are now employing swarm technology. Centralized traffic control
doesnt work when the traffic becomes very complex and time cycles
are shortened. The Japanese use a bottom-up swarm model to schedule
their famous bullet express trains, which boast incredible punctuality.
Switching is done locally and autonomously as if the trains were a swarm
with one mind. Railway owners in Houston are hoping to get a swarm model
running for their rail yards. With their current centrally controlled
system, the switching yards are so clogged that there is a permanent
train of freight cars circling the greater Houston area as a buffer.
Its like a mobile parking lot. When theres an opening in the
yard, cars are pulled out of the holding pattern train. But with a
system based on the swarm model, local lines can autonomously switch
themselves, using minimal intelligence onboard. Such a self-regulating
and self-optimizing system would reduce delays.
Thats how the internet handles its amazing loads of traffic. Every
email message is broken into bits, with each bit addressed in an
envelope, and then all the fragmentary envelopes are sent into a global
web of pathways. Each envelope seeks the quickest route it can find
instant by instant. The email message becomes a swarm of bits that are
reassembled at the other end into a unified message. If the message is
re-sent to the same destination, the second time it may go by a wholly
different route. Often the paths are inefficient. Your email may go to
Timbuktu and back on its way across town. A centralized switching system
would never direct messages in such a wasteful manner. But the
inefficiencies of individual parts is overcome by the incredible
reliability of the system as a whole.
The internet model has many lessons for the new economy but perhaps the
most important is its embrace of dumb swarm power. The aim of swarm
power is superior performance in a turbulent environment. When things
happen fast and furious, they tend to route around central control.
By interlinking many simple parts into a loose confederation, control
devolves from the center to the lowest or outermost points, which
collectively keep things on course.
A successful system, though, requires more than simply relinquishing
control completely to the networked mob.
to the bottom is not what embracing swarm is about.
me retell a story that I told in Out of Control, a book that details the
advantages, disadvantages, quirks, and consequences of complex systems
governed by swarmlike processes. This story illustrates the power of a
swarm, but it has a new ending, which shows how dumb power is not always
In 1990 about 5,000 attendees at a computer graphics conference were
asked to operate a computer flight simulator devised by Loren
Carpenter. Each participant was connected into a network via a virtual
joy stick. Each of the 5,000 copilots could move the planes
up/down, left/right controls as they saw fit, but the equipment was
rigged so that the jet responded to the average decisions of the swarm
of 5,000 participants. The flight took place in a large auditorium, so
there was lateral communication (shouting) among the 5,000 copilots as
they attempted to steer the plane. Remarkably, 5,000 novices were able
to land a jet with almost no direction or coordination from above. One
came away, as I did, convinced of the remarkable power of distributed,
decentralized, autonomous, dumb control.
About five years after the first show (this is the update), Carpenter
returned to the same conference with an improved set of simulations,
better audience input controls, and greater expectations. This time,
instead of flying a jet, the challenge was to steer a submarine through
a 3D under-sea world to capture some sea monster eggs. The same audience
now had more choices, more dimensions, and more controls. The sub could
go up/down, forward/back, open claws, close claws, and so on, with far
more liberty than the jet had. When the audience first took command of
the submarine, nothing happened. Audience members wiggled this control
and that, shouted and counter-shouted instructions to one another, but
nothing moved. Each persons instructions were being canceled by
another persons orders. There was no cohesion. The sub didnt
Finally Loren Carpenters voice boomed from a loudspeaker in the
back of the room. "Why dont you guys go to the right?"
he hollered. Click! Instantly the sub zipped of to the right. With
emergent coordination the audience adjusted the details of sailing and
smoothly set off in search of sea monster eggs.
Loren Carpenters voice was the voice of leadership. His short
message carried only a few bits of information, but that tiniest speck
of top-down control was enough to unleash the swarm below. He
didnt steer the sub. The audience of 5,000 novice cocaptains did
that very complicated maneuvering, magically and mysteriously. All Loren
did was unlock the swarms paralysis with a vision of where to aim.
The swarm again figured out how to get there in the same marvelous way
that they had figured out how to land the jet five years earlier.
Without some element of governance from the top, bottom-up
control will freeze when options are many. Without some element of
leadership, the many at the bottom will be paralyzed with choices.
Numerous small things connected together into a network
generate tremendous power. But this swarm power will need some kind of
minimal governance from the top to maximize its usefulness. Appropriate
oversight depends on the network. In a firm, leadership is supervision;
in social networks, government; in technical networks, standards and
We have spent centuries obsessed with the role of top-down governance.
Its importance remains. But the great excitement of the new economy is
that we have only now begun to explore the power of the bottom, where
peers holds sway. It is a vast mother lode waiting to be tapped. With
the invention of a few distributed systems, such as the internet, we
have merely probed the potential of what minimally centralized networks
At present, there is far more to be gained by
pushing the boundaries of what can be done by the bottom than by
focusing on what can be done at the top.
When it comes
to control, there is plenty of room at the bottom. What we are
discovering is that peer-based networks with millions of parts, minimal
oversight, and maximum connection among them can do far more than anyone
ever expected. We dont yet know what the limits of
The great benefits reaped by the new
economy in the coming decades will be due in large part to exploring
and exploiting the power of decentralized and autonomous networks.
First we make a chip for every object. Then we connect
them. We continue to connect all humans. We enlarge our conversation to
include the world, and all its artifacts. We let the network of objects
govern itself as much as possible; we add government where needed. In
this matrix of connections, we interact and create. This is the net that
is our future.
The whole process wont be completed by tomorrow, but the destiny
is clear. We are connecting all to all, until we encompass the entire
human-made world. And in that embrace is a new power.
Move technology to
invisibility. As technology becomes ubiquitous it also becomes
invisible. The more chips proliferate, the less we will notice them. The
more networking succeeds, the less well be aware of it.
In the early 1900s, at the heroic stage of the industrial economy,
motors were changing the world. Big, heavy motors ran factories and
trains and the gears of automation. If big motors changed work, they
were sure to change the home, too. So the 1918 edition of the Sears,
Roebuck catalog featured the Home Motora five-pound electrical
beast that would "lighten the burden of the home." This single
Home Motor would supply all the power needs of a modern family. Also for
sale were plug-ins that attached to the central Home Motor: an egg
beater device, a fan, a mixer, a grinder, a buffer. Any job that needed
doing, the handy Home Motor could do. Marc Weiser, a scientist at Xerox,
points out that the electric motor succeeded so well that it became
invisible. Eighty years later nobody owns a Home Motor. We have instead
dozens of micro-motors everywhere. They are so small, so embedded, and
so common that we are unconscious of their presence. We would have a
hard time just listing all the motors whirring in our homes today (fans,
clocks, water pumps, video players, watches, etc.). We know the
industrial revolution succeeded because we can no longer see its
soldiers, the motors.
Computer technology is undergoing the same disappearance. If the
information revolution succeeds, the standalone desktop computer will
eventually vanish. Its chips, its lines of connection, even its visual
interfaces will submerge into our environment until we are no longer
conscious of their presence (except when they fail). As the network age
matures, well know that chips and glass fibers have succeeded only
when we forget them. Since the measure of a technologys success is
how invisible it becomes, the best long-term strategy is to develop
products and services that can be ignored.
If it is not
animated, animate it. Just as the technology of writing now covers
almost everything we make (not just paper), so too the technologies of
interaction will soon cover all that we make (not just computers). No
artifact will escape the jelly bean chip; everything can be animated.
Yet even before chips reach the penny price, objects can be integrated
into a system as if they are animated. Imagine you had a million
disposable chips. What would you do with them? Its a good bet that
half of the value of those chips could be captured now, with existing
technology, by creating a distributed swarmlike intelligence using such
If it is not connected, connect it. As a
first step, every employee of an institution should have
intimate, easy, continuous access to the institutions medium of
choiceemail, voicemail, radio, whatever. The benefits of
communication often dont kick in until ubiquity is approached; aim
for ubiquity. Every step that promotes cheap, rampant, and universal
connection is a step in the right direction.
knowledge. Use the minimal amount of data to keep all parts of a
system aware of one another. If you operate a parts warehouse, for
example, your system needs to be knowledgeable of each parts
location every minute. Thats done by barcoding everything. But it
needs to go further. Those parts need to be aware of what the system
knows. The location of parts in a warehouse should shift depending on
how well they sell, what kind of backlog a vendor forecasts, how their
substitutes are selling. The fastest-moving items (which will be a
dynamic list) may want to be positioned for easier picking and shipping.
The items move in response to the outsideif there is a system to
spread the info.
Get machines to talk to one another directly. Information should flow
laterally and not just into a center, but out and between as well. The
question to ask is, "How much do our products/services know about
our business?" How much current knowledge flows back into the
edges? How well do we inform the perimeter, because the perimeter is the
center of action.
If you are not in real time,
youre dead. Swarms need real-time communication. Living
systems dont have the luxury of waiting overnight to process an
incoming signal. If they had to sleep on it, they could die in their
sleep. With few exceptions, nature reacts in real time. With few
exceptions, business must increasingly react in real time. High
transaction costs once prohibited the instantaneous completion of
thousands of tiny transactions; they were piled up instead and processed
in cost-effective batches. But no longer. Why should a phone company get
paid only once a month when you use the phone every day? Instead it will
eventually bill for every call as the call happens, in real time. The
flow of crackers off grocery shelves will be known by the cracker
factory in real time. The weather in California will be instantly felt
in the assembly lines of Ohio. Of course, not all information should
flow everywhere; only the meaningful should be transmitted. But in the
network economy only signals in real time (or close to it) are truly
meaningful. Examine the speed of knowledge in your system. How can it be
brought closer to real time? If this requires the cooperation of
subcontractors, distant partners, and far-flung customers, so much the
Count on more being different. A handful of
sand grains will never form an avalanche no matter how hard one tries to
do it. Indeed one could study a single grain of sand for a hundred years
and never conclude that sand can avalanche. To form avalanches you need
millions of grains. In systems, more is different. A network with a
million nodes acts significantly different from one with hundreds. The
two networks are like separate speciesa whale and an ant, or
perhaps more accurately, a hive and an ant. Twenty million steel hammers
swinging in unison is still 20 million steel hammers. But 20 million
computers in a swarm is much, much more than 20 million individual
Do what you can to make "more." In a network the
chicken-and-egg problem can hinder growth at firsttheres no
audience because there is no content, and there is no content because
there is no audience. Thus, the first efforts at connecting everything
to everything sometimes yield thin fruit. At first, smart cards look no
different from credit cardsjust more inconvenient. But more is
different; 20 million smart cards is a vastly different beast than 20
million credit cards.
Its the small things that change the most in value as they become
"more." A tiny capsule that beeps and displays a number,
multiplied by millions: the pager system. What if all the Gameboys or
Playstations in the world could talk to one another? What if all the
residential electric meters in a city were connected together into a
large swarm? If all the outdoor thermometers were connected, we would
have a picture of our climate a thousand times better than we have ever
The ants have shown us that there is almost nothing so small in the
world that it cant be made larger by embedding a bit of
interaction in many copies of it, and then connecting them all
The game in the network economy will be to find the overlooked small and
figure out the best way to have them embrace the swarm.