What is an Information Economy?
As stated in the previous sections, modern economies develop through drawing on value that is generated by user networks and attention. These different types of wealth are primarily created through the transferring of information, which plays a central and imperative role within the network and attention economies. Information becomes an extremely valuable commodity within modern global economies where “wealth in this new regime flows directly from innovation, not optimization” (Kelly, 1997).
But information is also overly abundant online and it is necessary to sift through large amounts of data when engaging through the internet. Users have access to information covering practically any topic yet they are forced to ignore the larger part of the web because of the sheer size of the network. This is why value is intrinsic within both the attention a user can offer as well as the networks they interact through. The following image shows the individual's reach amongst this information.
The ability to share, retrieve and interact with information across the internet has led to the creation of what Flew (2008) calls the “Global Knowledge Economy”. Flew suggests that the Global Knowledge economy results from three major factors:
the ubiquitous nature of Information Communication Technologies (ICT’s);
the rise of globalization;
the development of knowledge economies in general” (Flew, 2008).
These new economies are also “often referred to as the Information Economy, because of information's superior role… in creating wealth” (Kelly, 1997).
The internet changes global economics and trading by allowing the fast transference of information amongst global networks. “Transmitting information is one of the most valuable functions in an economy” (Leibowitz, 2002); and this is “what distinguishes the internet from the prior technologies…, its ability to quickly retrieve information stored on computers…” (Leibowitz, 2002).
While the web has not necessarily “invented new or entirely new ways to make money”, it has offered “up interesting opportunities to add a new twist on an old business model, or to allow business models to evolve in interesting and different ways” (Rappa, 2009). This is evident in the relationship between traditional advertising and attention economies, or the increased value of the individual amongst a network – or economies of scale. This has led to countless and innovative ways for businesses to engage in online commerce or trade.
YouTube and the Information Economy
The importance and value of information in the global economy is reflected in online services such as Youtube. Youtube strives to provide users with not just entertainment (Yong, 2010), but news (Popkin, 2010), resources, guides (H., 2007) and social networking services. This online media sharing service is a “provider of information” (Leibowitz, 2002); and it is these “concepts, ideas and images”, not things, which “are the real items of value in the new economy” (Rifkin, 2001a).
Youtube certainly provides access to the concepts, ideas and images of its content creators and as a provider of information, Youtube both sustains a healthy attention economy and benefits from networking effects. The more videos that users upload, the more information they are capable of providing. This increases traffic, or the economy of attention, showing how closely related and dependant the different elements of the new economies can be.
