07/02/2013 12:35 pm ET | Updated Sep 01, 2013

The Internet of Nothing: How the Web Could Collapse


The impending arrival of Google Glass -- the search giant's access-the-Internet-everywhere-and-all-the-time foray into the brave new world of "wearable" computing -- is being interpreted in two ways. First, as the advent of technologies that will bridge the increasingly narrow gap between human biology and technological interfaces. How long will it take for Google Glass to morph into Google Contact Lenses, then, ominously or not, depending on your paranoia about these things, into Android Brain Chips?

Second, and perhaps more pragmatically, as the hoped-for redemption of the dorkadelic Bluetooth earpiece.

But there's a third, less widely discussed and debated aspect to the advent of the Era of Glass, and it involves the so-called "Internet of Things," a term coined in the late 1990s by Kevin Ashton (who more recently scammed Twitter in spectacular fashion by creating a fake thought leader, "Santiago Swallow," with 90,000 purchased followers, a fraudulent Wikipedia entry, and a steady stream of nonsensical prognostication).

We're accustomed to thinking of the Internet as the connective tissue of a virtual metabolism. We tap into it with our various devices: smartphones, tablets, laptops, and so on. But technologists hope to shift this paradigm and in the process "liberate" the Internet from mere virtuality. In their vision, all technology is connected and made "smarter" by the Internet. Drone cropdusters are integrated with iPhone apps, which are integrated with global financial systems, which are integrated with power grids, which are integrated with autonomous "self-driving" cars and intelligent washing machines and GPS-enabled golf balls that can never be lost and commercial space capsules and cameras positioned on the bottom of the ocean and... well, it goes on and on and on. The world will be wired and very nearly sentient. The Internet will become its distributed, decentralized brain. You'll never get another parking ticket and the dryer will never shrink a wool sweater.

Humanity and its technology will gracefully merge.

It's a very compelling futuristic vision, science fiction made fact, but it also relies on the continued economic evolution of the Internet -- actually, an evolutionary leap by the Internet, sort of like the ancestors of land mammals first crawling from the sea -- and this is where some problems arise.

Maybe more than problems. Maybe a kind of technologist's catastrophe or nightmare.

The Internet's Three Core Functions

Due to smartphones and the envelope-pushing of technologies such as Google Glass, we've been collectively indoctrinated into an omnipresent cult of irresistible consumer Web evolution. Our iPhones and Android devices keep us constantly interconnected, and most Internet companies have figured out that the constant interconnectedness yields vast reservoirs of user data that are in just the early stages of being tapped. Big Data is the Internet of Thing's travelling companion in this narrative.

As users of technology, we've accepted, rather uncritically, the notion that it's always onward and upward. Moore's Law, meet human psychology.

But if you take a good, hard look at what's actually happening with the Internet's economy, a different story takes shape.

The Internet has evolved to have three main functions: communication, information and transactions -- in that order.

Communications first. The Internet was incubated by the U.S. government to provide a decentralized communication network of exceptional robustness. The everyday legacy of this is email, an extremely reliable form of textual communication that, unfortunately, nearly everyone has come to hate for its constant unmanageable presence and would probably like to see die off as soon as possible.

Information. The Web is the most obvious iteration of this function, a graphic interface built on top of the Internet. This is the realm in which frolic the vast majority of established and startup Internet companies. Google lives here, operating as a navigator. Facebook, too. Twitter. Yahoo. Amazon. Wikipedia. Even device-centric Apple, with the iTunes store. For the moment, this aspect of the Internet delights and seduces its audience, and seems indispensable.

Transactions. Paying your bills online. Applying to college. Applying for auto loans. Banking. Paying taxes. Renting or streaming movies and television shows. The Internet has streamlined all these function, eliminating the friction that once meant you had to deposit checks with a teller or go to the post office or fill out Form 1040 with little more than a sharpened pencil and a stiff drink. Life without these innovations looks... well, a lot more time consuming.

Three core functions. And of them, one whose signature achievement, email, everyone detests; one whose frictionless operations everyone thinks of as a given; and one where all the excitement happens.

However, that excitement looks less and less sustainable every day.

Things Fall Apart

Wikipedia is terrific, but it's a non-profit. The whole raging Silicon Valley argument for an Internet of Things entails the possibility of for-profit enterprises: connectors and facilitators and the countless nodes of a networked Nirvana. Without them, there is no thesis for investment. Without a thesis for investment, there is no venture capitalist argument for taking on risk, in a quest for an outsized reward.

Cracks are already apparent. Venture capitalists, facing disappointing returns since the dotcom bust, are talking about rightsizing their industry at around $50 billion annually. Raise more than that and you'll find that there aren't enough startups with good prospects to spend the money on. Innovation, it seems, has a speed limit.

Facebook hasn't managed, a year after it debuted on Wall Street as the most highly touted public company ever, to climb back to its IPO offering price of $38 a share. Zuckerberg & Co.'s recent efforts to tackle Facebook's mobile conundrum -- the HTC "Facebook" phone and the "Home" product -- have been disappointing. It turns out that a $100 billion enterprise might not be worth $100 billion if its defining purpose is to facilitate monetized sharing, which sort of flies in the face of the selflessness that sharing is meant to promote.

The most exciting thing to happen in technology in the first half of 2013 was the Bitcoin bubble -- the rapid price appreciation, and equally rapid price decline, of a peer-to-peer cyber-currency formerly best known as a way to anonymously buy drugs. A troubling type of excitement, when you consider that Bitcoin could be shut down tomorrow by the U.S., or any other, government that's hesitant to surrender its monopoly on control of the money system to a guerrilla currency invented by a Japanese hacker who no one has ever seen.

So it's not too difficult to imagine a future in which the Internet as we assume it will be, Google Glassed, constantly tweeted, and thingified, will collapse on its own inability to deliver any kind of real economic impact out of business models that are almost entirely based on advertising supported by the free labor of billions of users.

Are you getting paid for all that Instagramming, liking, tweeting, and status updating?

I didn't think so.

That leaves us not with an Internet of Things, but rather an Internet of email and online banking. Google's driverless cars could still happen -- planes can already fly themselves -- and that would open another function for the Internet, transportation. There will, of course, be infotainment beamed into our self-driving cars. If it all has to be ad-supported, it will not have much to offer economically beyond T.V. with a digital chauffeur.

When Evolution Becomes Devolution

I fully realize that the collapse of much of what we now know as the information Internet could spell problems for the Huffington Post and other online sources of news and opinion. I've been writing for the web since the mid-1990s, so the prospect of decline or collapse is discouraging to me.

But the economics are the economics, and it's clear that the disruptive potential of the Internet, where information is concerned, has been to drive the price of content ever downward, to the effective zero level of free. And it's not like the information Internet was a fad -- it's been in place for decades and has created tremendous value for companies like Google, as well as Google's shareholders. But nothing gold can stay, as the poet wrote.

The bottom line is that the Internet may not evolve as we have all come to think that it must, but that it could devolve, potentially retaining only its transactional functions, where the cost savings are so abundant that it's difficult to argue against them.

This isn't a very thrilling Internet. It's nowhere near as sexy as the Internet of Things or even the current social Web. But it's an Internet that has a sustainable economy and that ultimately makes life easier, in the same way that indoor plumbing or paved roads do.

Those technologies are largely invisible to us now. That's why I call the Internet of the post-Information Age the "Internet of Nothing." It will be indispensable. Useful. Necessary. And no one will care about it.

That might not sound like progress. But it is.