The Intention Economy

by Doc Searls, published 2012

Find it in the Open Library

The Intention Economy outlines Searls’ vision for a better internet. It centers on a tool called a Vendor Relationship Manager (VRM). Consumers would use the VRM to manage their relationships with various organizations.

Most of Searls’ thinking centers on commercial transactions. I admit that I’m skeptical of this premise. It reminds me of previous utopian visions centered on trade, such as Thomas Watson’s “World Peace through World Trade” when he was the head of IBM.Watson’s IBM continued to grow through the Great Depression and World War 2. Perhaps that’s why he continued to believe in this vision after these two global economic catastrophes. He crystallized this vision when he established the IBM World Trade Corporation in 1949.

I did my best to approach Searls’ work with an open mind, regardless.

Contracts of Adhesion vs. Freedom of Contract

Contracts of Adhesion underpin some of the most nefarious and absurd abuses of power on the world wide web. They are first encountered when you agree to a “Terms of Service” that you never read. These contracts can be summarized as “An agreement where one side has all the bargaining power [… presented on an] essentially a ‘take it or leave it’ basis without giving consumers realistic opportunities to negotiate terms that would benefit their interests.”West’s Encyclopedia of American Law

Friedrich Kessler argued that “mass production and mass distribution made this new type of contract inevitable.”Friedrich Kessler “Contracts of Adhesion: Some Thoughts About Freedom of Contract” Columbia Law Review (July 1943)

While it was thought that so-called Contracts of Adhesion might be unenforceable, the recent precedence in American courts suggests otherwise.See Judge Frank H. Easterbrook ProCD v. Zeidenberg (1995) ruling in favor of ProCD. “Shrinkwrap licenses are enforceable unless their terms are objectionable on grounds applicable to contracts in general (for example, if they violate a rule of positive law, or if they are unconscionable). Because no one argued that the terms of the license at issue here are troublesome, we remand with instructions to enter judgment for the plaintiff.” Software shrinkwrap licenses were a precedent for the web’s Terms of Service. They were essentially agreed to when the user broke the shrinkwrap and opened a box containing software on diskettes.

Thus Kessler was right, when he suggested in 1943 that the only way to move from Contracts of Adhesion that hold individuals prisoner to Freedom of Contract that empowers people to make fair decision is to break up monopolistic practices.“Its meaning must change with the social importance of the type of contract and with the degree of monopoly enjoyed by the author of the standardized contract.” ~ Friedrich Kessler “Contracts of Adhesion: Some Thoughts About Freedom of Contract” Columbia Law Review July 1943

Monopolies at post-Industrial scale lead to Contracts of Adhesion while competition naturally lead to Freedom of Contract.

Freedom of Contract is also natural on the internet. The conditions to facilitate this freedom is unique to the internet in the same way that Contracts of Adhesion were natural to the Post-Industrial era; the internet combines the power of software automation combined with the reality that each party is functionally equidistant to every other party.

Interoperable Commons

I take a commons to be a kind of property and I take ‘property’ to be, by one old dictionary definition, a right of action […] ownership rarely consists of the entire set of possible actions.

~ Lewis Hyde “Common as Air”

The current internet, comprising of walled gardens that enforce Contracts of Adhesion, ensures that data generated by my identity cannot work on any other system. There is no technological reason for this reality. It is seen as a way to maximize profits by protecting intellectual property.

The future internet built upon a Freedom of Contract would still allow services to profit from data generated by my identity. But the individuals on the system could also directly benefit from the arrangement while having more control over their data.

In other words, just because you can claim some ownership of the data I produce on your website, it doesn’t mean that you can do anything you want with it. This is similar to home ownership. Just because I own my home, it doesn’t mean I can turn it into a bicycle factory.

Searls sees VRMs as a way to re-center the internet around interoperable standards that can benefit everyone in the commons, including governmental and commercial interests. Moving our model of ownership that center on powerful government and commercial interests and towards a distributed commons will require:

  1. Policy activism
  2. Conventional interoperability (such as purpose-built Application Interfaces (APIs))
  3. Adversarial interoperability (such as internet scraping)
  4. Adoption of new technologies (such as Verifiable Credentials and Distributed Identity)

Several companies and organizations have shown that operating an open and interoperable organization is sustainable. Here are some examples; I have included their funding source to give some idea of how the organization stays afloat.

  • The Conversation: charges content creators, grant funding
  • Arduino: charges for physical material (circuit boards, modules, etc…), licensing the Arduino trademark
  • The Open Data Institute: grant and government funding, charging for custom services, donations
  • Open Desk: transaction fees from connecting furniture designers, customers, and local makers
  • Wikimedia Foundation: donations

Advertising and Customer Acquisition

Searls spends a long time talking about advertising in The Intention Economy.

He sees three inefficiencies: enclosed markets (by geography, walled gardens, etc…), captive customers (by loyalty cards, logins, etc…), and ineffective advertising.

The latter includes the much-vaunted targeted advertisements. At their optimum, targeted ads reduce “of all human interactions and interests into sets of data points that can be analyzed and traded,” opines Randall Rothenberg of the Interactive Advertising Bureau.

Rather than surveil customers, Searls essentially suggests that VRMs help people express their intentions. Sellers get more accurate information about a person’s need and individuals get to control what information they share. This is the ultimate win/win depicted in The Intention Economy.

The author plays out convincing scenarios where this might be beneficial to both parties. I am convinced on the merits, but only in a vacuum. The strongest aspects of The Intention Economy are those moments where Searls focuses on the historical context. I included much of that analysis in this review.

The full title of this book is The Intention Economy: When Customers Take Charge. Historically speaking, markets have been underpinned by exploitation, externalities, and collusion. Even advanced 20th century markets required legislation to protect consumers. A book like The Intention Economy would benefit greatly from caution rather than utopian thinking. I enjoy the author’s optimism, but the book too often echos those 1990s dreams of a disembodied cyberspace meritocracy. That vision could have benefited from a skeptic’s eye, just as the one laid out in The Intention Economy.