strate gy+business The Ambassador from the Next Economy by Lawrence M. Fisher from strate gy+business issue 44, Autumn 2006 reprint number 06309 Reprint d n i m e v i t a e r c e h t s e r u t a e 1 f The Ambassador the from Photographs by Vern Evans Next Economy Next features the creative mind 2 turned his life into a prototype into turned his life “Venture activist” Joichi Ito has Joichi Ito activist” “Venture e M. Fisher of the organization of the future. of the future. of the organization enc by Lawr r the from xt Economy Lawrence M. Fisher (fisher_larry@strategy- business.com), a contributing editor to strategy+business, covered technology for the New York Times for 15 years and has written for dozens of other business publications. Mr. Fisher is based in San Francisco. On Joichi Ito’s Web site, http://joi.ito.com/, there’s ture capitalist and a catalyst for computer-based socially f a link called “Where is Joi.” Click on it, and a NASA- oriented innovation, powerful decision makers are pay- e a generated image of the world pops up, with marks ing attention. t u r depicting his current location (in early June, this was “I’m not a typical venture capitalist,” says Mr. Ito. e s “Joi’s Lab,” his private refuge near the Tokyo Institute “Just about everything I get involved in has a steep learn- t h e of Technology) and his latest habitats. These have ing curve, has a lot of unknowns, and has risks. Just as c included, in recent months, hotel rooms in Toronto, some people are obsessed with money and are willing to r e a Helsinki, and Shanghai; his sister’s house in Los Angeles; do boring things day in and day out to be wealthy, I’m t i v the United Airlines flight between Tokyo and San obsessed with always being in a state of wonder.” e m Francisco (where Mr. Ito says he spends more time than Mr. Ito is known in high-tech circles for his un- i n in his own bed); and the offices of dozens of businesses, canny ability to identify the “next big thing” long before d groups, and friends he visits regularly. The map is not other people get to it, and for his quiet but pervasive always up to date, but no matter. These days Joi Ito’s influence on the development of the Internet. The first mind is most likely to be found online, in a game called Internet server in Japan was housed in the bathroom of World of Warcraft, no matter where on earth — or his Tokyo apartment, and he played a critical role in pio- above it — his corporeal self might be. neering online chat, digital advertising, social network 3 World of Warcraft is an immensely popular role- software, Weblogs (blogs), wikis (Web sites and docu- playing simulation, released by publisher Blizzard ments, such as the well-known encyclopedia Wikipedia, Entertainment (a division of Vivendi), based in Irvine, that allow users to add and edit material), and other Calif. Set in an intricately rendered fantasy world, it pits interactive media that continue to redefine the limits of two immense virtual societies of elves, trolls, wizards, communication and community-building. He was dwarfs, and other creatures against one another in a among the first to see the real possibilities in each of series of quests, battles, and trading encounters. WoW these technologies; his financial assistance and his advice (as it’s known on the net) has about 6 million members are credited with helping transform them from a techie worldwide (more than a million each in China and the plaything for the cognoscenti into broad-based media U.S.). It amounts to a parallel universe, with clearly with social, political, and business impact. delineated political and economic roles, drawing thou- “Joi interprets in deep ways; he’s a profoundly lat- sands of people from across the globe at any moment to eral thinker, and therefore he connects the dots better 4 encounter superhuman foes and to form collective than most,” says John Seely Brown, author of several 4 e u s s “guilds” via their personal computers. Spending count- eminent books on business innovation and the former i s s less hours in imaginary warfare may be simply a diver- director of Xerox PARC, the renowned Silicon Valley e n i s u sion for many people, but Mr. Ito insists that World of research center. “He is a hacker at heart, in the best sense b + y g Warcraft is nothing less than an emerging model for of the word. Not only does he go deep, but he also tends e t a r t organizational design. Given his track record as a ven- to build, or he collects builders around him.” s Joichi Ito has become one of the most visible global defenders of “open source” entrepreneurialism. In 2006, the Internet arguably faces its most com- ence in global Internet governance circles and in Japan prehensive set of challenges since it was made accessible in general: In May, a quietly published book of his con- f e to the general public in the early 1990s. A series of pub- versations with novelist Ryu Murakami rapidly climbed a t u lic debates — on Chinese censorship of search engines, to the sixth most popular ranking in the Japanese r e the ability of telephone companies and other Internet Amazon.com store. s t h providers to charge extra for premium service, the role of e governments in providing broadband access, and the The Next Cool Idea c r e future of Internet “uniform resource locator” (URL) Though Mr. Ito writes regularly (he maintains his own a t i addresses — have raised an old question with new blog journal and recently extolled World of Warcraft in v e urgency: Is the Internet primarily a vehicle for com- Wired magazine), his most common medium for m i merce or for community? The way these debates play expressing his ideas is his own frenetic lifestyle. He is the n d out, and the policies that result, could make or break a chairman of a Japanese Weblog software company called host of businesses and ventures. Six Apart Japan, founder and CEO of the Japanese In this milieu, Mr. Ito, at age 39, has become one of investment firm Neoteny, and a well-known activist on the most visible global defenders of the idea that com- behalf of open systems. In Japan, where he merce and community can be designed to mutually is now based, he fought unsuccessfully against the reinforce each other. He argues that the great businesses national ID card. In the United States, Mr. Ito has 4 of the Internet will not be those that stream canned focused on protecting the fragile ecosystem of the Web video or data, but those that bring people together as itself. He is an elected governor of ICANN, the Internet mutual creators, in a kind of “open source” entrepre- Corporation for Assigned Names and Numbers, the neurialism. Mr. Ito backs up this idea in part by under- nonprofit corporation that controls such mechanisms as writing the blog companies, participatory Web sites, and the nomenclature of .com, .net, and other URL codes. other interactive venues for which he is known. He also He also sits on the board of the Creative Commons, a has become a visible public advocate of legal and tech- nonprofit organization that is developing more practical nological structures in which standards are open, barri- alternatives to traditional copyright protection for an ers to entry are low for starting new Web sites or online online world, like the “some rights reserved” license that businesses, participation in online communities is allows copying, but with attribution for the original encouraged, new institutions have more freedom to author or artist. appear and gain influence, and the culture of the Web is Mr. Ito was also an angel investor in Technorati, a integrated with the world at large. At the same time, Mr. specialized search engine that keeps track of what is Ito advocates acceptance of more pragmatic security- going on in the blogosphere — the world of Weblogs — related measures: for example, making organizations and for this San Francisco–based company, he also has highly accountable for online fraud, scams, and other an operating position: vice president of international deceptions. All of this has given him an influential pres- business and mobile devices. David Sifry, Technorati’s f e a t u r e s t h e c r e a t i v e m i n d 5 founder and chief executive, says Mr. Ito’s global wan- about how to profit from “free” media; and then flew on derings make him the perfect person to negotiate with to Amsterdam to address a hacker’s convention about foreign partners, and that he also brings a special visibil- open source software strategies. A week later, he was in ity to the company as he takes on a more public politi- San Francisco, counseling the lawyers at the Creative cal role. Commons on how to balance intellectual property pro- In some ways, Mr. Ito’s style foreshadows the chang- tection with real-world Web usage patterns. ing nature of knowledge work; he moves among many Typically, when Mr. Ito discerns an idea with prom- organizations at once, balancing his entrepreneurial ise, he founds a company or funds an existing business individualism against an avid, even obsessive participa- to capitalize on that promise.