Team Genius: The New Science of High-Performing Organizations Read Free Page A

year.
    But, as with Moore’s law, the exponential implications of Metcalfe’s law are less noticed. Fifteen years ago, about a billion people regularly jumped onto the Web. Even then, that number already made the Internet the largest market in human history. But that was just the beginning. As of 2010, another billion people had joined the global marketplace. By 2012, 2.5 billion people around the world had joined the global, Internet-based marketplace. 2 Today that number likely exceeds 3 billion. And that number has yet to include those scores of billions of sensors and smart devices that will also soon be joining the Internet. Thus, according to Metcalfe’s law, the number of possible digital connections among people and sensors will grow into the trillions times trillions—a practical infinity.
    But just sticking to humans, we find that the third billion is very different from the first two. Most of this cohort lives in the developing world and probably in a teeming metropolis that barely existed twenty years ago. These users may never see an annual income of more than a few hundred dollars per year, and may have never driven in an automobile, much less flown on an airplane. Nonetheless, even if they are just selling items on eBay from a cellphone rented by the minute in a corner of some Third World city, they are adding value to the global economy. Just as important, they are helping create yet one more new submarket in addition to the millions springing up throughout the world. Even in developed countries, the Internet’s contribution to global GNP is now 21 percent, double what it was just five years ago. 3 It is growing at an even faster pace in the developing world.
    Let’s keep going—because waiting out there is a fourth billion, about which we know almost nothing. They live in some of the poorest and most isolated places in the world, with little contact with even the products of the developed world—many have neverused money or been in a car, and have seen an airplane only from afar. But they will join the global economy when the planet is completely covered with wireless connectivity. They will do so through minutes rented on a smartphone offered from a cardboard hut on a corner in some teeming Third World supermetropolis, or from one of the free phones handed out by the millions by the big telecom companies looking for new customers.
    Soon these third and fourth billions will be part of the Internet-based global economy. Companies, desperate for their business and the benefits of Metcalfe’s law, will use creative new means to seek them out and bring them onto the Web—even as the nature of that Web will be continuously transforming, thanks to Moore’s law.
    TWO LAWS BUT NO GUARANTEES
    So where does that leave us? Mass scale and, with it, global reach, will be incredibly valuable in the twenty-first century. But will they be enough to capture the huge opportunities offered by the third and fourth billions? Our conclusion: no. That’s because scale and reach are rapidly being commoditized. You can be a small company, and your opportunities to make products and services with large-scale efficiency are better than ever—and will become better yet in the future. A crucial understanding of Moore’s law is that it creates excess capacity—and not just in the world of electronics. For instance, extremely precise horizontal drilling far beneath the earth’s surface makes it possible to tap new oil sources trapped in shale rock. This level of precision is made possible by advanced electronics, itself made possible by Moore’s law. As the oil billionaire T. Boone Pickens told Forbes , “You can drill two miles down, take a right turn, drill another two miles, and pick the lock to someone’s front door. That’s how precise it is.” 4 Moore’s law, then, describes atendency to create excess capacity not just of electronic chips but of oil, factories, shipping—everything.
    As for global reach, you