> http://www.latimes.com/business/cutting/20000703/t000062700.html
>
> Monday, July 3, 2000
> He May Be Prophet or Pessimist, but Should Be Heard
>
> Jeremy Rifkin's new book describes a world shifting to 'hypercapitalism,'
where
> cultural experiences are chief commodity.
>
> By GARY CHAPMAN
>
> Jeremy Rifkin has another "big idea," which he describes in great detail
in his
> new book "The Age of Access: The New Culture of Hypercapitalism Where All
of
> Life is a Paid-For Experience" (Tarcher/Putnam, 2000).
>
> Rifkin, the author of other big-idea books such as "The End of Work" and
"The
> Biotech Century," is the preeminent master of overstatement. His books,
> nevertheless, are fascinating insights into long-term economic and
cultural
> trends that he covers in encyclopedic detail. "The Age of Access" roams
from
> Disney's planned Celebration community in Florida to the origins of
Algerian
> "rai" music; from John Locke to George Gilder; from the ancient Greeks to
> modern Hollywood.
>
> Never one to shy away from grand pronouncements, Rifkin's first sentence
is:
> "The role of property is changing radically." His basic argument is that a
new
> age of "hypercapitalism" is replacing the age of industrial production and
that
> increasingly people's chief economic activity will be selling or buying
access
> to cultural experiences.
>
> "We are making a long-term shift from industrial production to cultural
> production," he writes. "More and more cutting-edge commerce in the future
will
> involve the marketing of a vast array of cultural experiences rather than
of
> just traditional industrial-based goods and services."
>
> In his 1995 book "The End of Work," Rifkin predicted the radical
automation of
> nearly all industrial production and traditional services, leading to a
> permanent decline in the availability of traditional jobs.
>
> With the explosion of the World Wide Web, then in its earliest stages,
Rifkin
> suggested that e-commerce would lead to a thorough elimination of "middle
men,"
> with companies newly able to sell directly to consumers and tailor their
> production to individual consumer preferences.
>
> This was a notably early prediction of what has come to be known as
> "disintermediation." The idea quickly became one of the gospels of
e-commerce,
> showing up in Bill Gates' book "The Road Ahead" as the phrase
"friction-free
> economy."
>
> In 1998, Paul Saffo, a widely quoted researcher at the Institute for the
Future
> in Menlo Park, countered that view, saying that disintermediation is
"directly
> at odds with what is actually happening."
>
> "Rather than eliminate intermediaries," Saffo said, "information systems
do
> quite the opposite. Information systems are powerful commercial tools
because
> they reduce transaction costs. Lower transaction costs enable new kinds of
> transactions, which lead to new market niches and, overall, make the
market
> environment more complex. In short, information systems create openings
for new
> intermediaries to discover and occupy."
>
> Saffo called this a process by which traditional "middle men" of
transactions
> are eliminated and replaced by even more numerous interactions between
> customers and sellers. These hyper-segmented market niches are made
possible by
> cheap information technologies, which creates "relationships" between
consumers
> and sellers through a variety of new service vendors.
>
> Saffo said that this "value chain" between customers and companies, which
> everyone expected to get shorter because of e-commerce, is getting longer
and
> increasingly complex. There are more intermediaries, becoming not a chain
but a
> web of relationships.
>
> Even though this phenomenon seems to contradict what Rifkin said in "The
End of
> Work," he has picked up on this idea as well.
>
> "Perhaps as little as 5% of the adult population will be needed to manage
and
> operate the traditional industrial sphere by the year 2050," Rifkin said.
"As
> more and more of people's lives become paid-for experiences, millions of
other
> people will become employed in the commercial sphere to service cultural
needs
> and desires."
>
> Rifkin said that the age-old and familiar model of buying and owning goods
and
> services is turning into a new form of commerce, one in which consumers
buy
> "access to experiences," an ephemeral and endless process of cultural
> participation that is becoming commercialized. Thus the old industrial
power
> structure built around companies such as the Big Three auto makers,
General
> Electric, oil firms, Boeing and others is giving way to a new generation
of
> companies selling less tangible products, such as Disney, Viacom,
Microsoft,
> AOL, Time Warner and DreamWorks SKG.
>
> Moreover, in the "new economy," commodity prices are falling fast, profit
> margins for real goods are razor-thin, and a lot of essential software is
free.
> Companies such as Dell, Compaq and IBM are moving toward services and
permanent
> customer relationships. The market for renting instead of buying software,
from
> companies called "application service providers," was recently endorsed
and
> joined by Microsoft.
>
> Rifkin noted that car leasing is growing, access to the Internet and to
> entertainment sources is more important than ever, life spans of jobs and
> careers are shortening, and the longevity of companies seems to be
falling.
> Life is becoming postmodern, fractured, temporary and "sold back" to
us--the
> portion of family budgets dedicated to "monthly access fees" is growing.
>
> Rifkin said that these effects are having a profound impact on individual
> consciousness and on society as a whole. Once again, in his typical
sweeping
> style, he said, "The shifts from geography to cyberspace, industrial to
> cultural capitalism and ownership to access are going to force a wholesale
> rethinking of the social contract. . . . Access is becoming a potent
conceptual
> tool for rethinking our world view as well as our economic view, making it
the
> single most powerful metaphor of the coming age."
>
> One can be skeptical of Rifkin's metaphor--ownership, after all, is still
for
> most people the dominant form of personal security, not to mention
status--and
> still be intrigued by his assertion. Sure, Rifkin overstates his case,
leaves
> out contrary evidence and doesn't know how to qualify or soften his
arguments.
>
> Ironically for one of the country's most caustic and tireless critics of
> capitalism, Rifkin is popular with business readers because he "discovers"
> ideas that new-economy pundits are already talking about, but he blows
them up
> to the proportions of skyscrapers and then tells us we're all doomed if we
> don't change our ways.
>
> Rifkin is our Jeremiah, possibly our Cassandra. He's unique, iconoclastic,
> insightful, angry, dogged and, in the end, hopeful and romantic. We'd be
poorer
> without him.
>
> * * *
>
> Gary Chapman is director of the 21st Century Project at the University of
Texas
> at Austin. He can be reached at gary.chapman at mail.utexas.edu.
>
> Copyright 2000 Los Angeles Times
>
> http://www.latimes.com/business/cutting/20000703/t000062700.html
>
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