But the Internet is only the beginning. The network economy is not just humans sending e-mail to each other. Ultimately, everything that has a chip inside can be connected to the Net. The massive connectivity of objects and individuals is growing into a tidal wave of signals over a global network that is changing the fundamentals of our economy. An axiom of our old economy is that value comes from scarcity.
Diamonds are valuable because they are scarce.
But in the network economy, value is created from plenitude. The fax machine is valuable only when the rest of the world has a fax machine. It is the relationship of things to each other that surges in value. In the future, as the cost of producing an object falls steeply, it will be the network that invents, manufactures and distributes them that will increase in value. In the network economy, success is exponential, not linear.