Felix Stalder on Sun, 8 Nov 1998 23:49:43 +0100 (CET)

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<nettime> DigiCash: Failure is Interesting

Failure is interesting.

Much more than in success stories it is in sad failures where the gory
mechanics of development break through, scattered pieces lying around open,
available for inspection to anyone. No gloss of "evolution," "market
success," "superior technology" obscures the view on the vectors of forces,
the pulls and strings that shape the events.

The most important point to be learnt from DigiCash's troubles is the
utter contradiction of any techno-determinist view, or its milder, more
fashionable version according to which technology is developing according
to some inherent, independent trajectory.

What DigiCash's problems bring to the fore is that technology is much more
than just technology, a mere set of tangible and intangible artifacts. If
that was the case, DigiCash would fly miles high, because it is a
beautiful, elegant, socially desirable technology.  But it's flat on the
ground because it has been particularly weak at associating with its
technological proposal all the other elements that are necessary for
transforming a technology from an idea into something that actually works.

In the case of DigiCash, this would have been, most of all, banks and
users. But neither banks nor users are Alices and Bobs, as envisioned in
Chaum's blueprints. In the real world, they have their own interest, their
own inertia, their own idiosyncrasies which need to be reflected in the
technology they are to be attracted to it.

It might very well be the case that DigiCash was too good a technology, too
precisely thought out and over-developed.  When it encountered real human
beings, real institutions, real on-line behaviour this made it impossible
to change the technology to reflect those different interests, not because
it wasn't good enough, but because it was so well constructed that nobody
dared to fiddle with it.

In this sense, a strong but inflexible technology can be a major impediment
in technological development, because technological development is to a
large degree about the mutual and simultaneous constitution of multiple
elements: the technology under development; institutions supporting the
technology; society incorporating the technology into its routines; and
culture making sense out of what is happening and integrating it into a
larger context of who we are as we relate to the technology. None of these
elements can simply determine others, nor is any simply determined by
others. They are all in a process of constant adjustment.  Many of the
major new technologies have undergone series of deep changes under the
influence of multiple non-technical factors shaping its history, just think
of the history of radio.

A motley crew of different forces, ideas and interest needs to be
incorporated into technology in order to make it acceptable, that is, make
it work. The true innovators are, more often than not, not the brilliant
inventors, fully immersed in the technology and only the technology, but
"heterogeneous engineers" people who manage several areas at the same time,
able to translate from one into the other. This takes time, because  not
all elements change at the same pace. Artifacts are usually rapidly
replaced, but that doesn't mean that much, since they are only one,
arguably small, aspects of what technology is all about. Which is one of
the reasons why change is never discontinuous, despite all the millennarian
rethoric surrounding the Internet.

The other important myth that can be easily debunked  looking at the story
of DigiCash is the 'invisible hand' of the market and the supposedly
pitoval role of 'consumer choice'. These concepts might be adequate if
introducing a new technology was about putting new artifacts out and then
see who picks them up. But the mutual adjustment of factors that have
sometimes a very slow pace of change requires deep pockets and sustained
efforts. In the case of electronic money, it requires extremely deep
pockets since the product is technologically, economically, legally,
politically, socially and culturally so complex.

Looking at the current  field of electronic money, only heavy hitters are
left over. There are the smart card behemoth alliances -- Mondex and
VisaCash -- which are backed by a significant share of the financial
industry. Pockets don't come any deeper than this.  And still, even they
have massive troubles coordinating all the different aspects that,
together, make a technology work. Mondex has just rescaled significantly
its implementation in Canada. Not even the most wealthiest institutions can
simply control technology (as political economy tends to suggest).

On the other end, micro-payments are being promoted by IBM and
Digital/Compaq, companies that can also mobilize very significant
resources. By the time when these technologies appear on the 'market' most
of the major decisions will already been made.


Les faits sont faits.

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