 Well, good evening everybody. Wonderful to be here. Thank you to IC Qatar for hosting me this evening, and thank you for all of you for coming out in such large numbers. I wanted to start this evening's proceedings with a few observations just about the events that are transpiring around the world. I think Brian put it quite well. I mean these are quite extraordinary times. We know we see the winds of change beginning to blow across the Middle East as people aspiring to freedom are able to connect and collaborate more readily than at any time in history. We see the rise of new global powers, right? We're no longer in a world where there is one dominant superpower. We've seen the rise of China, India, Brazil, a whole range of new economies, new countries that are beginning to affect the balance of power. At the same time, we see unprecedented global challenges. We see the rise of climate change becoming a global issue, food prices are rising. We see water shortages around the world. All of these kind of challenges will begin to test the true limits of human ingenuity. And at the same time, of course, the subject that I'm here to talk about this evening, we've had the digital revolution, which probably more than anything else has really started to revolutionize the way that we connect and communicate with our friends and the family, the way that we work. It started to transform major industries like media, entertainment, software, pharmaceuticals. But more than anything, I think it has started to change the very mode of human organization. It changes the way that we organize ourselves as businesses, as governments, as universities. And the metaphor I would use is that the organizations today are becoming less like the hierarchy of the old bureaucracies of the past and increasingly like social networks. In the sense that they are highly distributed, they're able to connect with and tap into talent and skills around the world. They're able to innovate with greater ingenuity, more dynamism, more agility than ever before, in part because we have this global fabric of connectivity and this platform for collaboration and innovation provided by the internet. Again, we think this is a highly revolutionary force, but it's not the first time in history where we've seen this kind of profound change. And I think it's worth reflecting on the fact that these kind of punctuation points, these points in history where we have profound change have come with fairly regular intervals. And I think that the analogy we use in our most recent book is, of course, the printing press. The invention of the printing press by Gutenberg about 500 years ago, just over 500 years ago, started a process of broadening the distribution of knowledge and power. For the first time, the feudal kings and monarchs could not dominate discourse and politics. They couldn't control religion. They couldn't control science. For the first time, people everywhere were able to communicate and share knowledge and information. We saw the rise of scientific communities. We saw the rise of an educated class and new political freedoms. And those freedoms and that ability to print and distribute information more broadly led to the eventual rise of industrial capitalism, the reformation, the scientific enlightenment, and ultimately the modern democracies that we see flourishing across most of the world. And it's quite possible that we see a similar process unfolding today. As the internet continues this long historical trajectory of broadening the distribution of knowledge and power in society, that institutions are again in flux. We're seeing deep changes to government and democracy. We're seeing changes to science. We're seeing changes to healthcare and many other institutions. And we think that that sets the stage for a very exciting time in history. Now, you may be wondering, how does this relate to me individually and what can I take away from this evening's talk? And I want to suggest two things. I certainly impart my thoughts on how the digital revolution is beginning to change all of these various institutions. But I also want to offer you something a little bit more tangible too and give you a sense that you as individuals too have an unprecedented opportunity as a result of the digital revolution. Because what we have found in our research across all of the various sectors of industry that we've looked at across many of the institutional shifts that we've begun to document in the books that we have written, this opportunity that individuals can now be change agents in ways that wasn't possible before. They can connect and collaborate and shape the course of history themselves. In some respects they can participate more deeply in co-creating public services for instance or participate more deeply in shaping their healthcare or shaping their educational experience. And that can be profoundly empowering. Now at the same time there could be downsides to digital revolution too and we'll reflect a little bit on that but I do think that this opportunity that we have today is exciting and that's one of the things that I want to impart tonight. Now I thought I would start this evening by telling you a little bit about how I came to truly appreciate the value of the internet and the digital revolution in it. It started in 1994. I was working as a news producer in a small campus community radio station in Toronto, Canada where I live. And every day we prepared to do the news broadcast at 5 p.m. and we started very early in the morning about 8 a.m. in the morning and we would sit around and read the morning's newspapers. We would collect all of the newspapers from Toronto including the local community papers and we would have a look through the papers and try to decide which of these stories is most pertinent to our audience. And then that was a sort of interesting way for us to find out what's relevant and then we would look for people to interview that we could have live on our news program every day and we would invite them to have conversations with us and that would be the essence of how we gathered our news. And then in 1994 one day we had a computer science student and he connected a few computers to then which was a very early stage internet, a very text-based internet. And all of a sudden our process for gathering news changed fundamentally because we were no longer reliant on the local newspapers. Suddenly we had access to this vast world of information that for us didn't exist previously. We could connect to sources of news around the world very easily. We weren't limited to what editors had decided was the most relevant news of the day. We could find out what was happening across the world and most of our audience were new immigrants from South Asia, from Africa, from across the Caribbean. And all of a sudden we could actually develop and tap into news stories that were very relevant to them because we could source the news that I said from around the world. And that to me, for that was really exciting and that was empowering because I had access to all this information. But that was really just the first iteration of the web. That was what we called the, in our book, Economics, we called the Publish and Browse Web because in many ways when we have a new communication technology our tendency is to impose the old mental models of the previous technologies and the new technology on the new phenomenon. So we tended to initially think about the internet as an extension of the publishing medium. It was a bit of a broadcast approach to the internet in the sense that our experience was largely about viewing very static websites. And what we have seen since then is the internet has matured and we start to really understand its inherent power to enable interactivity and communication was that what was really unique about this new generation of websites was that many people are no longer just passive receivers of content. They are actually able to engage, to co-create, to create content in ways that weren't possible before. And we saw the rise of YouTube, of Wikipedia. Of all of these user generated sites, Flickr being another example where again, the difference was that rather than just passively receive the information you could get engaged in creating the information. And that was I think what really cued us to this important phenomenon that we wrote about in economics, that this was a big change not just in the technology but in the way that we use the technology to affect social change or to innovate as businesses. And the metaphor that we often use to describe this shift is that rather than think of the internet as an information highway as a more sophisticated pipe, if you will, for delivering information to audiences. Think about it as a global computer but in many ways everyone can program because if you are updating your Twitter if you are modifying entries on Wikipedia if you're updating your Facebook profile in some small but ultimately significant way you are helping to program the global internet you are adding to this vast tapestry of knowledge and of course when you have 2 billion people connected to the internet who are engaged in this kind of content creation it is ultimately a very staggering rate of evolution, of creation, of new content every single day just the data, the information that people are contributing is exploding in a phenomenal way. Now at the same time, and this is more recently we started to notice a shift in the way that people consume information too and I like to think about this as a bit of a shift from a search based web where the way that we access information was through Google we would search for information and Google would pull up a list of links well a lot of people would start to complain about this sense of information overload and not being able to navigate or find quality sources of information but what we are seeing is that social networking is adding this new layer to the way that we retrieve and access information because through Twitter if you follow the right people you can get access to very high quality information and your social network in a sense becomes the way that you parse information the way that you distinguish between poor quality information or high quality information and for me it has become enormously useful if I look for experts on the future of energy or the future of biotechnology or nanotechnology or other fields I can feel like I'm actually plugged into what is the latest thinking what are the latest developments and you get it straight from the source the people who are actually at the forefront of these kind of innovations so this kind of social layer on the web itself is hugely transformative and many people are beginning to think that these kind of social connections that your network in a sense will start to affect many other things that we do on the web including if you think about it it already is affecting the way that we purchase things because you get recommendations through Amazon you know other people who have similar tastes for instance if you share a certain taste or buying patterns it will recommend similar books and this happens with movies and music and chances are it could extend to other areas like finding a good physician or finding an educational institution that fits your unique skills or unique interests or needs so this is quite interesting now in parallel with these shifts we've begun to see this change where the dominant way that we access the web increasingly is through the mobile phone and again this is another you know thing that's happening in parallel with this change in the way that you know we view the web overall it was amazing to me we were doing research for the new book and I was looking at energy actually and a case study on Tanzania where they're beginning to you know exploit new forms of solar energy and what I found was that this was quite remarkable that you know 10% of Tanzanians could access a modern electrical grid but 97% reported that they could access a mobile phone you know so the kind of access issues that we have seen in the past it's not to say that the digital divide has disappeared by any stretch but certainly the widespread availability of mobile phones is beginning to increase the number of connected people they estimated quite recently that by the end of last year there were 5 billion mobile subscriptions now some people have multiple subscriptions so you have to factor at some of that but certainly at least half of humanity has access today to a mobile phone which means you know the vast majority of people can or a majority of people can now access the web and that has you know huge implications I think as we go forward one of the implications is that people can now connect to you know economic opportunity in a way that wasn't possible in the past I recently came across this company called TextEagle and they figure you know through mobile networks they can start to take the typical kind of outshoring and outsourcing to a new level they can start to farm out tasks to people who are connected to mobile phones now this may start out as fairly you know small tasks things like translating documents for instance could be done quite readily over a mobile phone sometimes they do this for you know transcribing even medical records in some cases companies have experimented with this but you could kind of see where this is evolving you know that billions of people who are currently on the periphery of the economy can now you know get access not just to not just the jobs but potentially to all kinds of different economic opportunity or opportunities for crowdsourcing and this is a big opportunity for companies as well and their ability to find new sources of skills and new sources of talent now the other thing that I think is remarkable about the mobile phone is that of course it's no longer just a device for talking or even just accessing you know the web increasingly it's going to give us access to this vast you know library of recorded information and I remember you know recently hearing Kevin Kelly talk to Kevin Kelly was the co-founder of Wired magazine and you know he talked about you know the fact that a couple of years ago you know the idea of storing all of recorded you know knowledge and human culture you know all of the movies and books and so forth that have been written over the course of history you would need a hard drive probably half the size of this room in order to store it all and that's not to say that you know Moore's law is proceeding at such a pace that you'll be able to store all that information on your phone but what you do have with broadband networks is the ability to retrieve that information from what people call the cloud you know the ability to access it on demand and again here you know it's another you know fairly revolutionary idea that you know within the next five years or even less potentially that this kind of access to all of recorded knowledge will become possible for a large part of humanity now you know the mobile space I think is is fascinating in part because you know the global connectivity of course is is influential but what a lot of people are finding is that it's the access to people nearby you know people who you have shared affiliations or shared goals or shared interests with you know this is the four square phenomenon or other local social networks that are allowing people to discover things in their neighborhood because of the fact that they can see very readily you know people who may be connected to them on Facebook you know if they happen to be co-located in the same city or they can get access to you know reviews about restaurants or other local happenings you know that allows them to you know feel more connected to the places in which they live so the you know the local and the global interconnectivity is quite important and I came across you know this interesting example an MIT experiment you know just the other day it's called WikiCity Rome and what they have realized is that by you know the tracing of GPS signals they can actually take in essence the real-time pulse of the city and this is you can look this up yourself you can go to WikiCity Rome just if you Google that you can pull up the information and they have this interesting little animation essentially what they've done over a 24-hour time period they've looked at you know the flow of the population throughout Rome throughout the city you know based on the movement of cell phone signals and what that allows you to do is see the real movement of people you can see you know kind of the life of the city illustrated in a very short time span and for urban planners that means they can begin to optimize infrastructure or planning decisions around the actual flow of information not just the flow or the flow of people rather rather than you know the kind of uses of infrastructure they predicted so for instance you know think about transportation networks you know you could know by looking at all these GPS signals you know where are the people in the city and are the buses where the people are you know in essence are we optimizing our transportation system to match what actually happens in reality now things get potentially even more interesting when you think about the fact that you know because of what they call geolocation or location based technologies you know your phone because it was GPS signal knows where you are and you can tag information with a geographic location as well that it becomes possible in a sense to browse the physical world that and in essence what you have is the ability to layer a whole you know vast array of virtual information over the physical world so that if you're a tourist in a new city you can point your phone at a particular building and it can describe to you the historical context or it could tell you for instance that building happens to be for sale it could do all kinds of interesting things I mean the ability to layer information you know virtual information over a physical space is potentially endless they have talked about this idea that users individual you and I could actually annotate the physical world so I could leave a virtual sticky note for my friend saying last week I was at this restaurant and they have great Hawaiian pizza you should check it out so that when my friend actually passes that restaurant they get a little notice on their phone that says well Anthony was at that restaurant and he liked the Hawaiian pizza so go check it out or your roommate is coming home from work and you leave a little virtual sticky note outside of the grocery store saying hey we're out of milk could you pick something up on the way home I mean these are the kind of possibilities I mean these are just little anecdotes but you can imagine the ability to layer all of this virtual information will give us much more rich information about the world around us it doesn't prevent us from engaging with people or the environment but it really does amplify the amount of information available to us and this you know this is one of my favorite examples when we talk about digital technologies and mobile innovation and where it's going Nokia recently developed what they call an eco sensor phone which means that it has little sensors embedded in the phone that are able to detect air pollution you know at a very granular level different types of pollutants so you can imagine a scenario where you know millions or potentially billions of people have these kind of eco sensors plugged into their phone as a matter of course it becomes one of the standard part of the architecture of a phone that for you know for the first time we could be getting planetary feedback on air pollution in real time around the world and in order to test that proposition they did a little experiment in San Francisco and what they did is they essentially took these sensors and they equipped them to the street sweepers that drive around San Francisco all day long so as these street sweepers are driving along San Francisco they're air quality measurements at a certain interval and as they're taking these air quality measurements they're reporting it back to a central database so that in essence what you see in real time again is a really granular map of air pollution across the city and then you can start to develop new public services so for the first time if somebody could receive a text alert on a day in which air pollution in their neighborhood is very high and if you have asthma that could be a real life and death concern right so for you could for instance sign up to the service and when you enter an area where you know in which air pollution was particularly bad you could receive a little alert saying put on your mask or step inside indoors so these are pretty amazing possibilities but in some ways it goes even further and this is part of a broader shift that people have described where air pollution of information technology is going from connected computers to connected phones to ultimately connected everything where the internet becomes pervasive ubiquitous embedded in all kinds of different products even yes your underpants in some respect because this is a prototype that scientists have recently developed in which that little carbon electrode on the underwear actually monitors your vitals including your heart rate, your glucose level and that kind of information could then be reported back to your personal health record for instance or for someone who is managing a chronic condition that information can be reported directly to your physician so they could remotely monitor the status of your health at the same time you know we see farmers fields that are connected to the internet because they are beginning to communicate with satellites and they can monitor you know the soil moisture or they can decide do we need to irrigate the field a little bit better and a lot of this can be automated transportation systems are again becoming much more intelligent because cars have sensors that can they can detect problems on the road for instance if your car drives over a pothole it could report that information directly back to the local officials so that they could dispatch people to repair it we can start to predict traffic flows much more accurately in fact we can begin to reroute traffic in fact Google Maps is already beginning to do this when you ask for directions on Google Maps they are starting to use satellite based information to not just give you the route that they give everyone but rather to give you the route that makes the most sense at that particular moment in time because of existing traffic patterns so the kind of information that we get about our environment is just becoming richer and richer and more detailed and more granular giving this you know essentially what people have described as a central nervous system for the earth so that is in I guess about 10 or 15 minutes my kind of very quick overview of where the digital revolution has been and where it's going from a technology perspective but what I want to emphasize this evening and spend most of my time talking about is the impact ultimately on people and communities because I think that's where the really profound and interesting things begin to happen the technology itself of course is fascinating but it's what it does you know to us is individuals and our ability to collaborate and share information that I think is most revolutionary and you know there's two ways that we can potentially come at this you know one is we've already begun to think about what does this do to us as individuals you know especially this first generation of young people that are growing up in this hyper stimulating digital world does it change us as people does it have lasting generational effects and there's a lot of evidence that suggests that yes that is in fact the case they've started to study young people today and I think the research is still a little bit preliminary to make you know definitive conclusions but they're suggesting that young people are developing different cognitive abilities in part because of this experience growing up always using digital technologies and some of this may be good and some of it may actually be bad you know they worry for instance about attention spans and whether people have the cognitive capacity now to engage with long complex text in a age where you know it's much more likely that people are paying attention to the very instantaneous kind of information you would get on Twitter for instance but on the other hand there was an interesting study done on surgeons and they compared young surgeons and elder surgeons in terms of their proficiency in the profession and they had an interesting and surprising result they found that even though the older surgeons were much more experienced the younger surgeons were actually more capable and they had a hypothesis again a hypothesis which you know we still have to see through repeated tests whether this is true but they suggested that young people were actually better at conducting surgery because they had grown up playing video games and they were very dexterous they had very fine motor skills in their hands and in part because surgery today especially microscopic surgeries increasingly mediated through computers they are much more familiar with the kind of techniques and the technology for conducting surgeries that was a very important and interesting insight you know the main point being is that certainly this will begin to change us as individuals and will have lasting generational effects but what I want to you know my main interest is how it affects human communities in the way they organize and you know I think that you know what's fascinating to me is that you know human communities today no longer revolve solely around geographic proximity so the people in your immediate neighborhood and they don't necessarily just revolve around professional affiliations either I mean the point is that today you can organize a community around virtually any shared endeavor any shared goal any shared aspiration and and you know the fact is that you're able to connect with you know hundreds even thousands of people who may share those aspirations irregardless of geography enabling all kinds of niche communities to form and you know we've seen the impact of this of course you know recently you know starting with Iran and more recently with Egypt and Tunisia and of course what's happening in Libya as we speak today you know the ability of young people to connect and share information now I think you know there's a very interesting debate happening in my field and among you know various commentators about you know what is the true effect of Twitter and Facebook on these kind of revolutions is it a determining force is it merely one factor among many I think of course there's a lot of factors here including you know the economic situation and the fact that you have large youthful populations but there's no denying the fact that you know this fabric of connectivity allows people to share information and organize much more efficiently than in the past and we see this in our approach to global problems too the way that we organize around issues like climate change for instance this is an interesting example we came across in preparing for the new book as we were researching and we were a little bit skeptical of the ability of governments to ultimately regulate this process because it's proven very difficult to get any kind of even national based consensus let alone a consensus on an international level about how to tackle this problem but you know what we found is that across the world there are thousands of individual mass collaborations if you will you know from the local community through to the international level people beginning to organize around this issue and one of the interesting responses has been something called carbon rally so the basic premise is that we can all take individual actions that will make a difference in terms of you know protecting the climate or protecting the environment that we live in today lives and when we take those actions as individuals it can sometimes feel like we're you know a very small drop in the overall bucket it doesn't feel like our individual action has a great deal of consequence but if you can organize tens of thousands even hundreds of thousands of people to take the same action all at once you know the impact can feel much more significant because you're part of a larger crowd and community of people that are undertaking stuff in solidarity so what carbon rally does is every week they announce a new challenge you know one week it might be you know we're going to change our driving patterns you know we're going to use more public transit or next week it might be we're going to wash our clothes in cold water we're going to undertake actions to conserve energy and so you know people subscribe to these challenges and you know 40,000 people doing that collectively all at the same time measuring their impact and so people feel like they're making a much larger and more significant contribution and what you've seen is that high schools have sort of to get involved so that you have you know different high schools challenging one another and even companies are getting involved so you could see you know large companies saying well you know which of us in a competitive situation can be the most energy efficient Google versus Microsoft or you know think about it in terms of large scale political institutions this Congress versus the European Parliament or you know that kind of idea you know you could get institutions involved in a very significant way to drive change now the point that we made in our book is that you know the social networking and the ability for communities to organize is very interesting and very important but there's a big change happening in the very nature of business and arguably this social networking that you know we have been talking about has become a new mode of social production where for the first time in history individuals can actually create products and services without you know the usual kind of you know modus operandi of having a large structured you know top-down corporation you know so a great example of this and one of the definitive examples of this of course is Wikipedia you know the first peer produced in psychopedia arguably the largest repository of human knowledge in the world free human knowledge for that matter with 3.5 million articles it's about 15 times larger than its closest competitor encyclopedia Britannica 15 times larger you know it's been translated into 200 different languages again all this done on a volunteer basis they have about 10 full-time employees they've had you know millions of people who have made contributions in some form and that's not to say everyone makes the same or equal contribution because they find if you look carefully at the social dynamics and the organization of the community actually there's a hardcore repository of about 50,000 people who do a lot of the heavy lifting and that's quite natural and expected when you look at kind of the nature of communities generally I'll talk about Linux in a minute too the open-source software system you see very much the same kind of structure where you have a large community of people who may do you know make small contributions or edits but you have this very engaged and passionate community that does things like adding all the hyperlinks and uploading images and actually moderating debates you know when you have different or contrasting points of view about a particular article a lot of people get involved to help you know moderate those kind of debates over content but you know in many ways you know what was remarkable to us you know when we first saw Wikipedia was that at least according to economic and political theory this kind of mass collaboration on that kind of scale shouldn't even be possible I mean if you had asked somebody you know a couple of decades ago could you create an encyclopedia without a traditional publishing company millions of volunteers nobody would have said that was even possible they said no that would never happen it's not possible and yet they found that you know through the right division of labor and by putting in place you know a kind of mission you know a shared goal a shared mission of making all of this knowledge you know free and available to the world they were able to organize people on a very large scale you know Linux was a very similar kind of example you know the world's first open source operating system well when Linus Torvalds the guy who originated Linux first posted the operating system to the web again he had really no idea what was going to unfold from there he was a university student in Helsinki and you know he asked for you know some help from fellow programmers to help perfect this operating system and within a couple of days he had three to five suggestions and within a couple of weeks all of a sudden he had hundreds of interested people and over there a couple of years you know a couple hundred people turned into several thousand and pretty soon they had this you know large dispersed community of software programmers around the world who were all united and passionate about this idea of creating a free open source operating system that anybody could program and share with the world and that this act of creating open source software would transform software and make it widely available to users who had never been able to afford or use that kind of software in the past now the traditional software companies as you might expect didn't think that this was a very credible operating system at all they said oh Linux will never have the robustness or completeness of a proprietary operating system they don't have the management controls the quality controls you know how could a loose you know organization of software programmers with with no CEO and you know no paychecks probably compete with Microsoft or Sun or Oracle or other large software providers and they dismissed it but you know lo and behold you look at it today and Linux is running 80% of the world's web servers it's embedded in thousands of different consumer products you know from T-Vos to even BMWs use Linux as the background operating system in the car you know we found out that Germany uses Linux for some of its air traffic control systems and even running some of its nuclear power plants in many ways you know Linux has become pervasive and last year I was at the Linux annual user form in Tokyo and you know the president of the Linux foundation said you know there's not a person in the modern world that doesn't use Linux every single day often without even knowing it because again with 80% of the world's web servers every time you access Google you are you know even without knowing it using Linux in many ways China is probably the biggest the world's largest user of Linux anywhere they've decided essentially to put their entire government infrastructure on an open source based system so this kind of and actually you know let me make this point too because a lot of people say oh well it's free software doesn't that just take away from the private sector doesn't that you know kill jobs and they say no actually in fact you know Linux the ecosystem creates about 50 billion dollars worth of economic value every single year and this is you know the operating system may be free but all of the consulting advice the maintenance and support the contracts for installing Linux and in large enterprises that creates a lot of value all of the products that I described you know from the Teavos to the Motorola Razors all of the you know consumer electronics that embed Linux you know if you count that as part of the ecosystem it actually makes a huge contribution to economic growth and by the way you know companies like IBM and other large companies that have since started to support Linux you know because they see that this is a real viable operating system have estimated that if you wanted to create Linux from scratch using proprietary software development methods you'd have to spend about 10 billion dollars in terms of total investment of human capital over many many years to replicate that effort so it's a pretty stunning accomplishment so then the big question was if you can create an operating system or if you can create the world's largest encyclopedia using mass collaboration without traditional management controls without traditional paychecks and incentive systems you know what else could you do what else could you create and how could large traditional companies potentially take advantage of this and that's where we stumbled across Procter and Gamble you know which which again became one of our showcase examples in the first book Wikonomics and here was the issue it was about the year 2000 Procter and Gamble was going through a real rough patch you know their stock price had declined their innovation success rate had flatline they said look you know we're putting all of this money into internal R&D and we're not generating more innovative products and services you know what can we do about this and the CEO said we're going to do something radical in the next 10 years we're going to source 50% of all of our new products and services from outside of the company and of course the R&D people said you're nuts you'll never be able to do it I mean where are you going to get all these good ideas from and how are you going to do it they said well you know we've done a bit of an analysis and we've we've looked at you know the whole world of science and various universities and discovered that you know we may employ 9000 of the world's smartest people in chemistry and biology and other related science fields but for every one of the 9000 that worked for us full time we've identified another 200 who are just as good people in research universities other companies startups all kinds of different places and if you're quick with numbers you'll realize that's 1.8 million people who they could potentially tap into 1.8 million people now there's no company on the planet that can afford to employ 1.8 million people full time but what P&G realized that because of this approach of mass collaboration because of the internet they could begin to tap into that skill that's you know that talent pool in a way that was much more efficient in a way that was you know more ad hoc or on an as needed basis for instance and so one example of a way to get access to this talent was Innocentive and Innocentive is a network of about 250,000 scientists around the world and you know most of them are freelancers many of them they're distributed around the world they're in universities they're in other places and P&G may be looking to solve a problem and they've posted on the Innocentive Network if they can't solve it readily inside they posted on the Innocentive Network and chances are there's somebody in that network of 250,000 people who may have you know just the right kind of combination of skills and expertise to solve the problem they often find that the best kind of problem solving is cross-disciplinary when somebody who's in engineering or physics or something looks at a chemistry problem from a unique vantage point and is able to offer a unique kind of insight that they didn't find inside the company now the question is what happened to the 9,000 people who they employ full-time well they still employ 9,000 people it's just it started to change the R&D function so rather than invent everything inside they realized that they had to change the incentive system so that you know people who are in R&D and product development were rewarded for commercializing products irregardless of whether they were invented initially inside P&G or they were invented somewhere else so this kind of approach you know has increased R&D productivity by 60% it's reduced their overall cost by billion dollars and it's resulted in hundreds of new products in the market and since 2000 it's been 10 years and they now estimate in fact they're sourcing more than 50% of all of their new product ideas from outside of the company so that's just one example you know a more recent example would be Apple and the iPhone or for that matter Google and the Android platform you know again here you have a company which has developed a very successful product but it's not you know a typical static product in which you buy the product and then that's it I mean what they have done through the creation of the App Store is you know they've unleashed this broad vast ecosystem of software producers who can create interesting applications for the phone that Apple is a single company could never have produced I mean they have 300,000 apps available through the App Store Apple probably creates one percent of those apps if even that much so here's the idea you know rather than create a traditional static product you create a platform for innovation you open it up so you can take advantage of this large pool of people who are you know potentially going to develop new and innovative for that phone and that's exactly what they've done and it's a large part of their success again you know able this ability to tap into this large external pool of talent another example is Lego a company which has been phenomenally successful in tapping into the ingenuity of its customers ultimately and every year they have a design competition where they have people between the ages of you know 5 years old and 95 years old who actually download a little bit of software from the Lego website and they're able to design their own custom Lego sets then they get the whole community involved in actually voting on what is the best design and the most popular design as judged by the community is actually put into production and here's you know where it gets really good because the person who did the design actually gets a 5% royalty on sales so they actually have a real big stake in what happens and they actually benefit commercially from the production of that particular Lego set and I think the other thing that is important to recognize here is that it's not just large companies that can take advantage of this kind of mass collaboration or take advantage of the internet in fact you know probably the more important contribution here is to small companies who can now in many respects you know entrepreneurs can tap into global capabilities global networks to market their products on a global basis so that you know rather than start out as a small local independent company you can start to reach and you can go global from essentially day one you can take advantage of Pinoco which is this really innovative company which started out of New Zealand and essentially what they have done is they've set up a system of manufacturing and essentially you know raw material sourcing where somebody who's a very clever designer can upload a design to Pinoco and Pinoco will help them source the manufacturing around the world and take care of the customer fulfillment you know the shipping and logistics and everything else so it's essentially an out of the box solution for somebody who has the creative input but doesn't have the kind of capital to invest in manufacturing facilities so think about the kind of entrepreneurial potential that that could unleash you know where all kinds of people from around the world could take advantage of this kind of system to get their products to people who want to buy them in a way that wouldn't have been possible even a few years ago so that's a you know a quick look at some of the economic potential here and we spent much of the past couple of years saying well if this is changing business you know surely there must be impacts in other institutions and surely you know governments must be thinking about how they can exploit mass collaboration to you know co-produce public services with citizens or get citizens more engaged in policymaking or you know the healthcare system and other institutions would change and what we found is that you know that was exactly the case you know that there were profound changes happening in many other parts of society so take healthcare as an example you know as individuals we have you know traditionally been relegated to a very passive role in healthcare because doctors were sent you know considered to be the only authoritative source of medical knowledge and you know rightly so you know doctors undergo a lot of training to develop you know their knowledge and competency and delivering medical services and making important judgments and diagnoses but you know you can't deny the fact that over the past ten years as individuals we have access to this huge enormous wealth of medical information online and increasingly you know the quality that information has gone up significantly and I think people have become a lot more sophisticated about you know how they navigate that information and how they make decisions and of course you would always recommend that you know anyone consult with their doctor when making these kind of decisions but there certainly has been a shift in power where patients who used to be very passive are becoming much more active and claiming a much larger role in their healthcare and there's many different examples of this and different levels of engagement. So you now see for instance you know the ability of patients to actually rate the quality of their doctors and websites that have sprung up you know to allow this kind of comparison so that people can you know if you're moving to a new region or a new location you can look up on these kind of www.mymd.com and figure out you know what have other people said about the quality of this physician and the kind of services they provide and it gives you access to information that you wouldn't have had before as a patient. And in the UK they thought you know doctors don't kind of like this kind of you know stuff but they thought hey this might be a good way for us to improve our healthcare system because we can get feedback directly from the patients about their experiences in particular hospitals and different wards and hospitals you know and as an institution like the NHS they can start to target their resources for improvement to the kind of feedback that they're hearing from individual patients so this has become essentially a very dynamic feedback system where they can learn from the whole community of users and it's a very different way of thinking about how to allocate resources. Now you know arguably I talked about you know the connected underpants and the fact that you know increasingly we'll be able to monitor our vitals and we're finding that this too you know drives a fairly important change in the way that people approach their health because what studies have shown is that when people monitor their health on a regular basis you know they're more committed to being healthy. It's kind of that you can't manage what you don't measure ultimately right but when you are tracking your vitals on a regular basis you have the kind of data that you require to make more informed decisions about your lifestyle that affects your health or more informed decisions you know to make in consultation with your doctor about you know the effectiveness of particular treatments for instance and for people with chronic conditions this is very important they find you know people with diabetes in particular are finding these kind of health monitoring technologies are increasingly important and play a very important role in their health care but arguably even more important is this ability for people to form communities around specific conditions and patients like me is a great example of how innovation over the internet can augment or complement traditional health care it doesn't replace none of this replaces what the existing mental community provides but it helps enhance the whole health care experience so let's say for instance you have a very rare form of cancer a neurological disease or some sort of genetic condition that is you know not very prevalent in the overall population the chances of you finding other people like you in your immediate community are fairly small but on the internet there could be thousands you know hundreds even thousands of people with a very similar condition and the ability to connect with those people can hugely enhance your chances of coping effectively with your disease a recent study again another medical study found that actually loneliness and isolation were some of the biggest medical risk factors even greater than smoking because when people are lonely and isolated they don't cope as well when managing the disease they tend to be more depressed you know they're not as proactive and they don't have the source of emotional and kind of pure support they can enable them to cope much more readily with their condition so through patients like me you found people congregating around their conditions and sharing information and even you know this has become a basis potentially for a more effective approach to clinical trials because you don't have to again rely on a particular university or hospital being able to aggregate a local population of patients because you can start to collect the data from a whole much larger population of patients across the internet now naturally this raises issues around privacy and other issues and security of data and so forth but a lot of people who are on patients like me find that the trade-offs in terms of them disclosing more data but themselves than the other mice would have been very much worth it because they're getting a lot of value as individuals in return so that's one example of healthcare you know how about government you know we have a situation in North America and particularly in the US but you see this across Europe as well and certainly in Canada where trust in elected officials has been dropping for about four decades you know certainly since you know the highs in the 1960s a lot of people have become increasingly disengaged with government and we find that you know that's a fairly dangerous direction to be heading in you know in part because it erodes trust and legitimacy but also because you know we have immense challenges you know and governments are struggling in some ways to develop effective policies and you know the way we think about it is you know you've got a large chunk of the population that could be contributing to effective policy development you know that are effectively unengaged in government and that there's an opportunity here again to get citizens much more connected and engaged in the process of governing you know one great example and this is a recent initiative that the Obama Administration undertook was to launch something called challenge.gov and on challenge.gov it's a little bit like the proctor and you know gamble example but applied to government there's a lot of big challenges that they face in terms of you know dealing with energy issues dealing with you know the fact that their rates of educational achievement have been dropping significantly over the past couple of years and they're no longer you know students in the US or a ranking you know in 30th and 40th place on literacy and mathematics and other things so they've got these deep challenges but they're not tapping into the ingenuity of their country as a whole so on challenge.gov an agency can launch a challenge and they can you know rather than rely on the people that they employ full-time they can start to tap into what entrepreneurs or people in universities could potentially do to help solve the problems you know the Department of Energy has recently launched a fairly significant challenge to develop a 10 watt light bulb you know that would emit essentially the same amount of light as a 60 watt bulb but you know if it was developed you could have a huge impact on energy conservation across the country you know so and by putting a little bit of money behind the effort there's an incentive for entrepreneurs and other researchers to actually contribute to solving this issue so it's a much more you know collaborative approach to thinking about you know how do we as institutions solve these really grand challenges that we face and I think you know education is another area where we spend a lot of time you know thinking about you know how does the digital revolution change the nature of the university and higher learning and create new opportunities for a different type of pedagogy a different type of teaching and learning you know we make the joke and it's maybe a little bit unfair but quite honestly I mean in many respects you've got an 18th century model of education in a 21st century world I mean if you could even go back further than that I mean people have suggested if you brought Plato or Aristotle back from the dead they would feel completely comfortable in today's classroom because the modus of education hasn't really changed that much it's still very much based around lecturing and conveying information to a very kind of passive audience in that you've got these young people coming into the educational system that have grown up interacting and collaborating and you know want a more interactive approach to education I think there's a lot of professors that realize this and have started to seize on the opportunities but you know the point is is that you know it's become fashionable we were doing research you know talking to students about their experience of higher learning and we found out that in a lot of the educational institutions it's become fashionable to get an A without having attended a single lecture you know so in some ways the cream of the crop you know the most skilled students are kind of boycotting the basic model of pedagogy they don't find lectures to be that effective mode of of learning now that's not to say that lectures don't have their place but the point is that you know with the internet and with sites like TED you can get access to high quality lectures from the world's most respected authorities on any imaginable topic right and and they're very accessible so we say what use is you know having necessarily a person you know lecture when you can get access to you know having a professor lecture when you can access to very high quality information on the web there's something called the Khan Academy this guy Salomon Khan is actually Bill Gates' favorite teacher and he got a lot of press recently because of his you know very innovative approach to using the web to essentially you know create a whole catalog of mathematics they're not lectures but they're more kind of interactive exercises they're become hugely popular and they're all produced you know essentially from his little studio that he has in his apartment and it's become hugely successful and they're ultimately free supported by the Gates Foundation and by advertising but a very effective way of getting educational tools in the hands of students but the you know the old notion that you have this kind of very siloed approach to education with you know very distinct universities I think is becoming a little bit of an anachronism you know it's no longer true that you know to get the best information you have to go and and seek out a particular university or a particular set of professors and and what we see is this incredible opportunity I think that Charles M. Best who is the president emeritus of MIT probably put it best you know he said that you know with open access publishing and with the web you know we've got this incredible opportunity to create essentially a meta university and you know MIT is as you know probably is one of the first institutions to put all of its courseware on the web it's taken you know all of its educational curriculum a lot of its you know the research documents and put them up on the web for free that you know could be utilized by teachers and professors that matter students around the world and he said this kind of activity when you combine that with you know the opening up of science in general creates a huge asset for the educational community for students and professors to take advantage of this you know very inter networked approach to the university so you can imagine a scenario where of course you know this isn't diminished in any sense the role of the professor I don't think this is huge you know evolving world and information they have to you know give students the critical thinking skills and they have to in some ways you know put a layer of you know they're responsible of course for accrediting and judging the performance of different students all of the things will probably remain but you know the way that we navigate the whole system the ability to potentially tap into the brightest professors and to create a better education I think is very exciting so here's another example too you know in terms of people using digital technologies to create a more experiential form of learning you know one in which you are not just reading about what it's like to be a chemist for instance you can in essence experience you know what it's like to be a chemist using this virtual digital technology and this professor that we spoke to in university had developed you know this whole way that students could go into the virtual environment of second life and actually fabricate molecules using digital technologies and he found that this was much more effective and much more engaging than a traditional textbook approach to learning so I'll give one more example and then I want to sum up with a couple high level principles and thoughts and this one comes from the you know another domain in which we've seen profound change in part because of the digital revolution and the possibilities that creates to for scientists to network and share information and this example comes from astronomy it's one of my favorites in the new book and it kind of illustrates the real potential here and it's a project called galaxy zoo and it started when a young PhD researcher was essentially studying the evolution of galaxies across the universe and he was particularly interested in how galaxies form and merge and evolve over time and as part of his research he had to essentially classify 50,000 different galaxies and as a result of these new high-powered digital telescopes they've got images of many more galaxies than we even knew existed and they've got essentially a lot of data that they have to classify and analyze and understand and he realized that to complete his project to classify these 50,000 different galaxies into one or two different types would probably take a couple of years of effort even if he had a team of graduate students working with them it was still going to take a very long time and what he did is he had been inspired by Linux and other open source projects and he thought what if I could get other people interested in helping me classify these professors and colleagues and they said well you could give it a shot there might be 200 people in the world who are interested in helping out with this but why not and so he put the images online and he created a short tutorial so that anybody could look after 10 minutes and understand the difference between a spiral galaxy or an elliptical galaxy and they could tell the difference between the different patterns and they could help classify and they thought let's see if the ordinary person off the street could do this full experiment and they found that the ordinary person without any previous training in astronomy or astrophysics could actually classify the galaxies correctly 95% of the time which is a very remarkable rate of accuracy so they actually went ahead and launched the full experiment and they said well let's see what happens and then the story got onto the BBC and pretty soon they had not only a couple hundred they had several thousand and then soon they had 150,000 in weeks the community had grown to 250,000 people who were helping to classify these images within a couple of weeks they had not only done the 50,000 they had actually gone through hundreds of thousands and by the end of the project over a couple of years they classified millions of galaxies exceeding by any estimation the progress that they had expected to make in that field I mean it had advanced the whole field phenomenally in terms of the amount of research they were able to complete and just to give you a perspective in terms of the amount of talent they were able to tap into the whole world contains about 6,000 astrophysicists if you think about it 6,000 in the entire world so by creating this crowdsourcing exercise they were able to tap into 250,000 people so they have essentially increased their talent pool by 40 times really by opening this up and here's all kinds of remarkable aspects of this story I was sharing this insight I think it was over dinner or lunch yesterday that one of the people who was really engaged by this whole activity happened to be a 25 year old school teacher from the Netherlands and one day she's classifying images and she sees a bright blue blob on one of the screens and she doesn't know what it is and it doesn't fit the taxonomy that the scientists had provided and so she posts it to the discussion board and says does anybody know what this bright blue blob is and nobody on the discussion boards can answer the question so they say why don't we ask the scientists and the scientists have a look at it and they don't know what it is either so after a couple of weeks of investigation they find out that actually this is a brand new celestial object that had never previously been identified by any trained astronomer or astrophysicist and that this 25 year old school teacher had actually made a very novel discovery and as it turns out she's now the co-author of a major scientific paper and she's not only the co-author this new celestial object has actually been named after her which you know is amazing and what's neat to me too is that you find out that the community engaged in this is actually this has become a social community so that people now have meetups in London Amsterdam and New York and they get together and talk about their experiences and a lot of new friendships have been developed as a result and the researchers you know they don't take this for granted you know they actually think of this community as an extension of their research ecosystem and they actually they release findings to the community before they actually publish in scientific journals because they realize that in order to keep this group of people involved and engaged you know they've got to treat them as collaborators not just as you know this kind of raw you know resource that they can potentially tap into so this has actually changed a lot of people thinking about what ordinary people can potentially contribute to science and now you've got people across a whole range of different fields saying how can we tap into similar opportunities I mean you know the possibility for scientists just to collaborate globally in and of itself is a huge opportunity and you find that those fields today increasingly operate globally as you know as opposed to the old model where it was you know based on kind of very specific universities or it was kind of national based collaborations well you speak to people now and they say well you know the moment I announce a new project I've got people from around the world wanting to pitch in so this has really changed the whole fabric of science in a very profound way so what kind of principles can we take from all of these different experiences and as organizations and even as individuals you know how could we start to think about how we maybe replicate some of these successes you know from the business world to the world of government and healthcare and science and we have essentially distilled it down to five key principles collaboration openness sharing integrity and interdependence and I can assure you that you know when you stand up in front of a business crowd people have become a little bit more receptive recently but most people say well these don't sound like conventional business principles to me I mean openness sharing collaboration what happened to competition and you know kill your competitor and that kind of stuff but we find that you know in all honesty this stuff this stuff actually works and let me explain why these these five principles are really important collaboration I think a lot of people get that now they understand what collaboration is important and that no matter you know how big or successful your company may be or if you're not in a company you know just replace that with government agency or healthcare institution or educational institution you know there's this vast pool of external talent that is you know always going to be able to contribute to innovation or product development or enhance whatever it is you're doing and a lot of people think that you know collaboration is about better teamwork within a department certainly one aspect of collaboration but what we have found that as a result of the internet is that you can actually you can start to really grow that collaborative community it can start to go beyond the department to the entire enterprise you can go beyond the enterprise to a broader ecosystem you know you take the example of Apple which has this whole ecosystem of business partners that contribute to developing apps for the app store what can go beyond the business ecosystem you know you've got Proctor and Gamble that says yeah we've got some pretty smart scientists we've got 9,000 people in R&D but we've got another 1.8 million people outside that we can potentially tap into so you know we're tapping the whole world we consider the world to be our R&D department in a very real and practical way and I think that you know that is the inherent power of collaboration that you can expand not only the number of people that you can collaborate with and you can get new ideas from but you can increase and this is the important part the diversity of the ideas and the talent that you can potentially bring to the table on any particular problem that you're trying to solve and that you know diversity of thought of capability of skills is what you know makes a huge difference for many of the companies that we've seen succeeding with this approach now openness is very important too because it's very hard to collaborate if you're opaque if you're not if you're not open if you're not transparent and you know recently we've seen of course with wiki leaks and this has been a general trend now for many years that the whole world is in many ways becoming more transparent but in cases like wiki leaks it's transparency being forced on in some cases organizations that haven't really you know they haven't really embraced the whole value of openness but you know what we find from these examples that you know even you know the largest one of the largest military organizations in the world or organizations like you know the US State Department can no longer monopolize and control information so now the question is as an organization would you rather be you know have your information forcibly disclosed or would you rather be proactive about transparency and create and foster of openness and what we find is that if you want to develop trust if you want to foster collaboration you have to give people information you have to you know build that trust and earn that trust through openness because the moment you start to hide stuff you foster suspicion you you foster potentially negative sentiments so you know we think openness is an important part of the equation here now we would go so far as to say that you can go beyond simply sharing pertinent information to actually sharing intellectual property and this is one of the principles that gets most under the skin of business people because they say sharing intellectual property are you crazy I mean isn't that sort of the antithesis of business I mean isn't that in essence communism and we say no because it's not about you know sharing all of your patents or sharing all of your intellectual property it's about sharing you know the aspects of your overall portfolio of intellectual property that can potentially further your business goals or that can you know potentially have you know positive repercussions for an entire industry and let me give you a couple of examples or at least one example that I find is particularly powerful and it's Nike Nike recently started an initiative called the green exchange and they're collaborating with Best Buy and a whole bunch of other companies on this green exchange and the idea here is that Nike and other companies are beginning to become leaders in what you would call green technology innovation they're starting to find ways to manufacture apparel and other products like clothing in a more environmentally responsible way now in many cases companies are reinventing the wheel because all companies are trying to figure it in some form or another you know how can we become more sustainable how can we become more green but in a lot of cases these you know particular innovations don't contribute directly to their competitive advantage so for instance Nike has a new form of green rubber you know a form of rubber which is less toxic less polluting which they can use in the soles of their shoes which they've now put into into use now the problem that Nike has is that it's very expensive to manufacture this green rubber because the kind of raw materials they need to manufacture the rubber and the economies of scale that would kind of make that more efficient just don't exist so they said we need to manufacture this green rubber with everyone including our competitors Adidas want to use it go ahead and use it because actually it's a benefit to us if we get the economies of scale if we get we can actually lower the cost of producing these shoes and then the whole industry potentially benefits you know we saw that another similar example in the pharmaceutical industries where initially in the human genome project in the 1990s a lot of companies were developing their own proprietary maps of the human genome and they realized at a certain point that it didn't make sense you know at the end of the day we needed one scientifically valid map of the human genome and we would get there a lot faster if companies actually contributed their research to the public domain and so through a collaboration with you know government authorities and companies they were actually able to you know complete the human genome project much more quickly than they otherwise would have in part because of this more enlightened approach to sharing realizing that they may be sharing some of the fundamental research but they were all going to still compete ultimately on the commercialization of new medicines and new products so sometimes it's about trying to figure out you know what aspects of value creation do we want to compete on and where do we want to share and potentially further and accelerate the pace of discovery in our industry now two more principles and they're both related and I think they're both increasingly important and the first one of the last two is integrity that increasingly I think it's important for companies to have good values to act with honesty and integrity and accountability and to be you know more socially and environmentally responsible you know we have seen recently you know the repercussions you know what happens when businesses lose their moral companies you know when they aren't transparent and they don't act with integrity we get problems like crisis but on the other hand we have seen you know companies are into address you know major problems in collaboration with other stakeholders you know the diamond industry recently came together with a whole bunch of governments across Africa and a major a set of major NGOs and human rights organizations to create a more transparent diamond supply chain so that they could start to address the whole issue of conflict diamonds and you know the issues of corruption and slavery that have plagued that industry and they have a certification process now where and a monitoring process that is overseen by third party NGOs and I'll have to say you know the diamond industry didn't come to this willingly at first there had to be you know years of pressure from human rights watch and other NGOs to say look you know there's a real issue here and this is leading to civil wars and it's leading to you know ethnic strife and it's causing a lot of hardship for people but eventually the diamond companies you know they realized the beers and other companies realized that you know this would be a more sustainable approach and one that you know ultimately would lead to a more responsible industry we've seen this mining companies now through this extractive transparency initiative are sharing information about the bribes that they potentially receive in different countries again to try and shine light on the issue of corruption we've seen the chocolate industry come together to address issues of slavery and the cocoa supply chain again kind of like the diamond industry you found that you know chocolate manufacturers had literally said we're not responsible for slavery in West Africa in the cocoa fields but you know they you know the human rights organizations again said well look you know you're ultimately manufacturing the chocolate and you're buying the cocoa off the commodity exchanges but that doesn't mean that your responsibility ends ultimately with you know you're purchasing of the commodities on the commodity exchange you're making huge profits off chocolate shouldn't some of that responsibility be invested you know be invested in improving the labor conditions for workers and they have come together to address this issue so you know we have seen lots of examples where companies can be good corporate citizens and do it collectively in industry through a collaborative process and ultimately I think interdependence is a very important principle too we think about you know the big challenges that I talked about you know earlier in the opening you know food rising food prices water shortages climate change you know we we live ultimately on a very small planet and with you know potentially nine billion people to support we are going to seriously test the limits of our you know ingenuity in terms of developing new technical approaches new you know social approaches to dealing with these kind of issues so I think you know the more that you know companies and other organizations realize the limits of the existing paradigm to solving global problems I mean we have a nation based system a nation state based system for solving problems which has been you know by and large I think fairly ineffective in many different instances and actually you know leading to change and I think the more they recognize the interdependence and the more that we can fashion communities of interest that can solve these problems the better off and the more quickly the problems will get resolved and I think I will I will leave it at that and I know that we probably have many questions but thank you very much for being such an attentive audience and I hope that this is will shed light on on the possibility of mass collaboration both you know organizationally but potentially too for you as individuals thinking about you know how you could benefit from this trend so thank you again