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A Nation Of Digital Shopkeepers

Yesterday Fred Wilson had an interesting post up on AVC.com about the Louis CK experiment.

On it, I said the following:

Yeah and that's the real interesting thing about all of this.Guys like Louis CK are going to be able to do this because of their built in audience, hard won over years of work, but they are going to make less than they did in the past - as those middlemen extracted pretty high rents for their services.The unknowns will have the ability to make something - rather than nothing.And the middlemen just get run over.So the high end comes down to the middle, and the low end moves up a but - and everyone in the middle gets pushed out of the system period. Frictionless capitalism = Europe. A vast middle class

Which I realize probably needs a little explaination.

I have long held a theory that the Internet is the great leveler - leveling the playing field for just about everybody - or certainly more people than ever. In Internet 1.0, there were a few firms and people that controlled all the traffic, and thus all the monetization - and that Internet reflected the world around it pretty well - to me it looked just like the U.S. at the time - the big corporations got bigger and controlled more and more.

With Web 2.0 and the rise of the social web, and a higher level of inter connectedness (if that's even a word) we've gone back to being nations of shopkeepers. Don't want to buy from Target, no problem - do your XMAS shopping on ETSY. Don't like what Yahoo music is serving up - no problem - Spotify is giving away 6 months of free music - with some great apps to go along with it.

In short, the Internet has driven us back to a more European model.

We live in a wide variety of small villages and groups (Facebook friends and Google circles) and shop in small marketplaces with  highly specialized and curated selections (Fab.com, Lot 18, Gilt, etc...)

We are a nation of digital shopkeepers.

Only now, we are no longer bound by geography and can live in multiple worlds at the same time.

Also, in the typical European model, due to the social programs, there is a vast middle class who gets by okay. Sure there are still stratas of society and people do move around, but the middle still dominates. Here in the US there is far more stratification and far more mobility but the edges dominate.

The web changes all of this. Margins are consistently compressed driving the high end lower toward the middle, and because of the vast audience you can reach, the very bottom can move up. Those who preyed on the middle - the so called middle men, get squeezed as their traditional command and control function disappears.

Tim Westegren of Pandora used to refer to all of this as an artists middle class - where you were neither struggling to make ends meet nor U2 - but there was a place in the middle where you could produce your art, find an audience, and get by.

We've seen this in music, in crafts (the Etsy's of the world), in book publishing (Wattpad comes to mind), and in other creative pursuits.

It's an interesting phenomenon and certainly worthy of thought and discussion.

Perhaps one of these days, elections in the U.S. and elsewhere will not be framed in light of the traditional issues affecting the physical nation, but the issues affecting the towns we choose to live in and become active in online.

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