Shane M. Greenstein

In less than a decade, the Internet went from being a series of loosely connected networks used by universities and the military to the powerful commercial engine it is today. This book describes how many of the key innovations that made this possible came from entrepreneurs and iconoclasts who were outside the mainstream--and how the commercialization of the Internet was by no means a foregone conclusion at its outset.

Shane Greenstein traces the evolution of the Internet from government ownership to privatization to the commercial Internet we know today. This is a story of innovation from the edges. Greenstein shows how mainstream service providers that had traditionally been leaders in the old-market economy became threatened by innovations from industry outsiders who saw economic opportunities where others didn't--and how these mainstream firms had no choice but to innovate themselves. New models were tried: some succeeded, some failed. Commercial markets turned innovations into valuable products and services as the Internet evolved in those markets. New business processes had to be created from scratch as a network originally intended for research and military defense had to deal with network interconnectivity, the needs of commercial users, and a host of challenges with implementing innovative new services.

How the Internet Became Commercial demonstrates how, without any central authority, a unique and vibrant interplay between government and private industry transformed the Internet.

Do online communities segregate into separate conversations about “contestable knowledge”? We analyze the contributors of biased and slanted content in Wikipedia articles about U.S. politics, and focus on two research questions: (1) Do contributors display tendencies to contribute to topics with similar or opposing bias and slant?  (2) Do contributors learn from experience with extreme or neutral content, and does that experience change the slant and bias of their contributions over time? Despite heterogeneity in contributors and their contributions, we find an overall trend towards less segregated conversations. Contributors tend to edit articles with slants that are the opposite of their own views, and the slant from experienced contributors becomes less extreme over time. The experienced contributors with the most extreme biases decline the most. We also find some significant differences between Republicans and Democrats.  

The experience of Encyclopædia Britannica provides the canonical example of the decline of an established firm at the outset of the digital age. Competition from Microsoft's Encarta in 1993 led to sharp declines in the sales of books, which led to the distressed sale of the firm in 1996. This essay offers new source material about the actions at both Encarta and Britannica, and it offers a novel interpretation of events. Britannica's management did not misperceive the opportunities and threats, and Britannica did not lack technical prowess. This narrative stresses that Britannica's management faced organizational diseconomies of scope between supporting lines of business in the old and new markets, which generated internal conflicts. These conflicts hindered the commercialization of new technology and hastened its decline.

Why did commercial Internet service initially develop in some geographical areas and not others? What determines the success of businesses? What determines the value of Internet services? The research stream developed the first analysis of the Internet access business and market in the United States, and addressed new questions as the industry evolved and policy interest changed. More recently, Professor Greenstein has begun to look back on the two-decade history of the commercial Internet, deriving lessons that come from taking a long perspective.

What is the value of digital platforms that build on user-generated content? How well do existing frameworks explain the value of these businesses? While drawing on prior work, this research stream examines new issues in parts of the economy that previously were slow to use digital processes. With the emergence of new data, Professor Greenstein is able to tackle questions that previously escaped attention. He is now examining such issues as bias on Wikipedia, the mismeasurement of the contribution of digital innovations (“digital dark matter”) to the U.S. economy, and the economic impact of the bundled contracting of broadband services.

On what dimensions do computing platforms compete, and how does that competition help or hinder the deployment of technical standards? What principles shape choices over platform governance, and how do those choices shape competitive outcomes? In this line of research, Professor Greenstein examines the many ways in which competitive rivalry influences the promulgation of standards, and which dimensions—such as proprietary and nonproprietary platform governance—really matter. His most recent work in this area focuses on smart phone platform competition.

Why do some organizations adopt new information systems while others do not? Why do some face high costs while others do not? Professor Greenstein has been pursuing this stream of research throughout his career, analyzing the factors shaping the costs of acquiring new computing systems and providing econometric approaches to estimating the costs of adapting new systems to unanticipated problems. In his early work on the transition from mainframe computers to client server systems, he argued that co-invention expenses—the cost of adapting to unanticipated problems—play an essential role in adapting new technology to new circumstances. Today, he finds that co-invention expenses continue to influence IT installations, such as electronic medical records.