Gift economy keeps on giving in virtual utopia

Net Results: One of the key reasons why the internet is so quirkily, satisfyingly wonderful is that it is one of the few cross-cultural, global examples of a "gift economy" at work.

The notion of a gift economy comes from socio-political theory, and the online Wikipedia encyclopedia (itself a gift economy offering) describes it in this way: "A gift economy is an economic system in which the prevalent mode of exchange is for goods and services to be given without explicit agreement upon a quid pro quo."

It offers, as examples, old hunter-gatherer societies where members share food because it ensures the survival, and thus greater safety, of the greatest number of members. But in more modern times, families might operate a gift economy by supporting other members through education. Another example: politicians will provide services in the hope of garnering a vote (though let's not muddy the picture with brown envelopes). Charitable giving is also considered an element of a gift economy.

Open source software production is a great example of a gift economy - developers do the work for an intangible sort of payback, the pleasure of writing good code and producing something worthwhile, not making an individual fortune. I'm regularly amazed by the prompt help I can get online, for free, with open source programs I use, from people who seem to get pleasure from being helpful and useful and supporting a project they believe in.

And then there's the internet overall,which must be the world's largest gift economy. From the very beginning, the internet was built by people who worked out the basic technology without direct payback, mostly because the technical challenges interested them.

Much of the internet and web's content came from those who loved the idea that you could make information available to anyone, for free.

Soon people were building their own websites and bulletin boards and e-mail lists and, generally, running them for free, for the pure satisfaction of offering a service others seemed to enjoy. Now we also have weblogs (a few people make some money through advertising, but that's a tiny number of those participating).

I've been running my own board for months now, and a weblog for several years, for free of course, and it takes hours of my time and causes occasional headaches.

But I love doing it. Why? I don't know; that's the whole enigma of the way the internet gift economy works. Sure, there's personal ego payback - a degree of pleasure in running something yourself, having people come to read what you have posted, and use the service you provide. It has indirectly turned out to offer some unexpected Irish and international visibility for me too, and introduced me to some new friends and professional contacts. But that was a bonus, not a motivation for creating the sites - the quintessence of the gift economy. I think a lot of us do such things simply because we can; the internet makes it possible.

What about business and the gift economy? The commercial world discovered the internet pretty quickly and an orgy of buying and selling and advertising began as the dotcom era shuffled in. The very antithesis of the gift economy, you might think, and in some ways that's true.

But interestingly, this is changing. I would argue that the companies that are using the internet most successfully are also participating in the gift economy, because the gift economy is intrinsic to the way the internet works. The lessons the corporate and commercial world have slowly learned is that people generally expect much of what is on the web to be free (hence the dotcom crash), but that if you join the gift economy you can blend Mammon and the Good Samaritan (so to speak) to actually benefit your organisation as well as your customers.

Take Amazon for example. At first Amazon sold books, full stop. Now, Amazon offers loads of services for free, letting you search the content of books, write and post reviews, and providing a second-hand book-selling forum.

Or take iTunes and eMusic, which sell you songs, but now also offer Cool Free Stuff like free songs, reviews, articles, the ability to make and share playlists, and chat to other music lovers online. They could just sell a product (books, music) but if you also give, regardless of whether you are getting anything in return, people will hang around, get involved, and probably, also buy.

Such gift economy examples are legion, and are growing ever more experimental for companies.

Think of corporate weblogs. As Microsoft and weblog evangelist Robert Scoble told an audience in Cork recently, corporate blogs can bring unprecedented attention and positive payoff for your company - but only if done honestly, openly,and in the gift economy sense of providing a service (information, support, ideas, answers to criticisms) without directly looking for a payback.

A tightly controlled business blog that is thinly disguised corporate propaganda will at best be ignored and, at worst, can damage company credibility and make it a laughing stock.

But offering blogs from the heart, which includes openness to criticism, even from within, can build credibility and, as Scoble notes, win companies the ideal customer - those who will go out and proselytize for the company because they feel they are being given access, information, insight and some straight talking.

This is risky, of course. But that, too, is the nature of the gift economy. Many dotcom companies and traditional companies coming to the internet failed when they tried to force a purely commercial mindset onto a gift economy milieu.

The real internet titans will be those smart enough to find a way to keep blending the two.

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