6 minute read

I presented and later ran a roundtable discussion on using web 2.0 and open source software for service/volunteer organizations. I kept getting requests for a "dummies guide" introduction to what's out there, and I'm going to just start here in my blog and see where that goes. Two caveats -- I don't believe in "dummies" guides, as I don't really believe in dummies (current White House residents excepted). Second, the landscape is more like a weather system, not a static landscape that can be described; so I'm going to be more like an almanac, trying to give you some general guidance rather than specific directions.

Let's start out with some basic underlying terms and theory from economics:

Network Effects describe situations where the number of people involved exponentially increases the value of getting involved - for example, if you're the only person with a phone, it's pretty useless, but each additional person who joins the phone network has a multiplicative effect on the number of connections available. By the same token, if you're the last chump still using a social network that's fallen out of favor (Friendster, Orkut, looking your way), it's equally useless. You can read lots more about the power of network effects by reading Watt's Six Degrees, and more on all of the stuff I'm about to talk about by checking out Benkler's The Wealth of Networks, which is available for free online as well as on Amazon, and you can of course contribute to the ongoing discussion at Benkler's wiki, linked above.

Rival goods are goods whose consumption by one consumer prevents simultaneous consumption by other consumers -- If I'm sitting in a chair, you can't sit in it, but if I'm reading a website, you can also read it at the same time.

Excludability is whether or not it is possible to exclude people who have not paid for a good or service from consuming it. Lighthouses are the traditional example of a non-excludable good; everyone can benefit from a lighthouse's warning. Excludable goods include anything you can protect or fence off.

Finally, Transaction Costs measure how hard it is to do something else; time, research, transport, etc. -- the costs of doing something beyond the cost of that thing itself.

By mixing these together, you can move from the tragedy of the commons to an evolving and increasing self-sustaining ecosystem.

Tux, the Linux MascotWhat this means back in the world of web 2.0 solutions; we see the power of Facebook to support non-profits in their “causes” application - in under five minutes you can start donating funds to any 501c3 by setting up a cause for it – that’s low transaction costs at work; instead of a laborious set of forms and credit card merchant accounts to set up, it’s all automated and easy to connect together. With Wikipedia, you see the benefits of non-rival, non-excludable goods combined with low transactions costs; it’s easy for anyone to edit, the edits add to build a larger system of the encyclopedia, a resource that can’t be restricted or reduced by usage. Indeed, with wikipedia, increased usage creates improved fact-checking and encourages further additions – something that has gotten termed anti-rivalrous goods.

So go and ponder the balancing act between rivalrous non-rivalrous, and anti-rivalrous goods, the impact of excludability and its limiting factors on the spread of information (your cause, your vision, and so on). A complicating factor here is how open and free can your organization be - are you willing to let people comment on your blog entries? Edit a wiki resource you're providing (lesson plans, resource guides...)? Write blogs, uncensored, on your website? You don't have to go all-in, but the quickest way to kill a web 2.0 strategy is to strangle it by increasing the transaction costs of it; moderating comments, slowing and impeding the natural tendencies of your constituents to work with you to improve your products to the benefit of your organization, and their fellow constituents.