The euphoria around crypto currencies and blockchains over the last year has been interesting to watch and while the financial outcome for recent investors is still in doubt, the broader implications around decentralization are not. When it comes to challenging central entities, this is likely just the tip of the iceberg.
The general consensus in the blockchain movement appears to be that blockchain and crypto-currencies are powerful tools for challenging central entities ranging from banks to governments and that the holy grail of this movement is to create a widely adopted form of decentralized money. Whether this is true and/or will or will not succeed, there are NOT many that today view this movement as a challenge to big players in tech such as Google, Facebook, and Amazon. Recent developments however seem to indicate that the “decentralization movement” and the technologies that are being produced today will challenge big tech just as much and if not, more, than banks.
As blockchain primarily enables and provides a decentralized consensus mechanism on top of which crypto currencies are built, a variety of projects are working on decentralized peer-to-peer storage, networking, and identity management. This will enable things like email without a mail server (no need for gmail, yahoo, Hotmail etc.), social networks without a central gateway (no need for facebook, instagram, etc.), and peer-to-peer storage/compute which will challenge services like AWS and other cloud providers.
Since there won’t be a middle-man running your mail server and collecting ad revenue while showing you ads, who will companies that would like to advertise their products pay? You! Since you will be in full control of your decentralized peer-to-peer social profile (since there won’t be a Facebook) you can pick and choose which companies you’d like to hear from. Those companies will in turn be able to perfectly fine-tune their advertising and send you a decentralized micro-payment for looking at their ad impression.
Your decentralized mail client will now reject any ads that do not have a payment attached and thus you will no longer receive junk mail. Instead of Google collecting ad revenue for showing you ads, you will receive that ad revenue directly from the advertisers. Advertisers can reduce their budgets because they can fine-tune their ad campaigns and won’t have to pay a middle man that has too much leverage and can demand high fees. There are already crypto currencies that are laying the groundwork for some of this such as the basic attention token (https://basicattentiontoken.org/).
The title of this post is quite dramatic so perhaps I should clarify: Google/Facebook as they stand today will shrink as companies, but Google and Facebook are also filled with highly qualified technologists that are well positioned to adapt and find ways to embrace and monetize this new paradigm. Somebody will certainly have to create a decentralized search engine and social networks and Google/Facebook are well positioned to fill that niche. But Google and Facebook as you know them today will become less relevant. Another important factor in the final outcome here will be the status of net neutrality as ISPs will potentially be put into a position where they could tilt the balance in favor of a solution that is in their best interest.
I’d like to thank the TDS Veritas Platform engineering team especially Christiaan Veerman, Feroz Rauf, Frederic Dang Ngoc, and Digant Modha, as well as Ramin Bozorgzadeh, Brett Bandsma, and Melik Kavcar for helping me flush out some of these ideas in a variety of engaging chats. This post is the result of decentralized group-think.