Isaacson notes that Jaron Lanier, another legendary cyberculture icon who pioneered Virtual Reality, agrees with Nelson and thinks the Internet economy has gone the wrong way. “The whole business of using advertising to fund communication on the Internet is inherently self-destructive. If you have universal backlinks, you have a basis for micropayments from somebody’s information that’s useful to somebody else,” said Lanier in a 2013 interview.
In his 2014 book Who Owns the Future? Lanier noted that the current Internet publishing model based on “free” information subsidized by advertisers favors a handful of powerful content aggregators over publishers - especially small publishers - and defended Ted Nelson’s original vision with two-way links and micropayments.
“The real sophistication of Ted’s idea is how it would bring about a balance of rights and responsibility while at the same time reducing friction,” wrote Lanier. “If the system remembers where information originally came from, then the people who are the sources of information can be paid for it.” It’s important to note that two-way links would work across multiple mashups and permit the originators of information re-used in derived works to keep earning royalties for decades. “A new kind of middle class, and a more genuine, growing information economy, could come about if we could break out of the ‘free information’ idea and into a universal micropayment system,” noted Lanier.
“In the late 1990s Berners-Lee tried to develop a micropayments system for the Web through the World Wide Web Consortium (W3C),” noted Isaacson. “It was never implemented, partly because of the changing complexity of banking regulations.” Web pioneer and Netscape creator Marc Andreessen, who considers Bitcoin as a good model for standard Internet payment systems, noted that, if he had a time machine and could go back to when the Web was first designed, “one thing I’d do for sure would be to build in Bitcoin or some similar form of cryptocurrency.”
Recently the W3C restarted its work on an overall Web payments architecture and produced initial drafts. The W3C drafts make only incidental mentions of Bitcoin and distributed ledger technologies. However, it’s worth noting that digital currencies based on distributed ledgers are the only form of Internet-native payment system that exists, works and effectively implements one-click payments.
A good example is SatoshiPay, a recently announced platform that offers Web publishers a new way to monetize content through frictionless Bitcoin “nanopayments” as low as fractions of a cent, that are instantly settled and can be executed at high frequency. “This enables completely new ways of monetizing Web content and digital goods in general,” said SatoshiPay cofounder and CEO Meinhard Benn.
But high frequency Bitcoin micropayments can only be implemented for mass adoption if the Bitcoin network is able to operate at high frequency, which isn’t the case at the moment. In fact, a recent research paper shows that, in the current design of Bitcoin Core, there is a fundamental conflict between throughput and decentralization. Incremental improvements could achieve a throughput of about 27 transactions per second in the Bitcoin network, but the price to pay for further increases would be making the Bitcoin system more centralized. More aggressive scaling will in the longer term require fundamental protocol redesign,” note the researchers.
There are initiatives to develop non-Bitcoin distributed ledgers to exploit alternative protocols that could be scaled to much higher transaction rates, suitable for a pervasive micropayment economy. It’s also worth noting that the Lighting Network, where related Bitcoin transactions can take place instantly on “micropayment channels” off-chain, with only the final settlement processed by the Bitcoin blockchain, could enable high-frequency scaling, near-instant transactions and efficient micropayments. Promising Lighting Network development projects have been started by, among others, Blockstream and the “Thunder Network” project.
It’s also interesting to note the similarity between Nelson’s two-way links and smart contracts, and speculate on whether two-way links could be implemented by next-generation distributed ledger technologies for smart contracts.