Central Planning in Cyberspace

I HAVE JUST RETURNED FROM CHONGQING, a city in the southwest of China that covers an area of 82 000 square kilometres and has an official population of 32 million people (unofficially it stands at 37 million). Think in terms of South Africa’s population squeezed into a relatively small area and you won’t be too surprised that it looks like Shanghai on steroids.

During this visit I found myself in the Urban City Planning Exhibition Center, a three-storey, high-tech building dedicated to planning the future evolution of the municipality. There are exhibits showing how the city has developed over the centuries. The 3D scale model that shows every street and every building is impressive enough, but an explanation of the amount of planning that goes into development takes the cake. It is meticulous, and also a great example of how you need to balance a tremendous number of factors to make the future urban environment both successful and sustainable.

All of which got me thinking about the internet. It’s tough being a geek. I’ve been working in the internet industry since it started to commercialise in 1994, and that has given me the opportunity to experience the breakneck evolution of a new social fabric.

Online things don’t only happen faster, the extremes are also exaggerated. I’ve heard a great many people predict the fall of the old economy and the rise of a new one, only to hear those same folk predict the commercial demise of the whole internet thing. There were mini-bubbles, yes, but there were also nuclear bombs that made up nicely for any half measures.

Me, I’ve always believed sustainable business is built over time and on a model that evolves as the environment changes. Which is all nice and rational, but doesn’t always fly in a world where expectations are set on a quarterly basis by analysts in foreign markets.

China has given us its fair share of unique and innovative business models, along with the usual whacky and unsustainable ones. But most impressive has been how quickly entrepreneurs here have learnt not to repeat the mistakes of the trailblazers.

Of course the proof of the pudding is in the eating – or rather in the results, when they are delivered, or not. That is where planning and patience have their reward. But, as regular readers know by now, around here it is all about harmonious balance, which is why vigilance and nimbleness is usually married to those virtues. That helps in an industry where even a ridiculously successful business model can be made redundant in an exceptionally short space of time.

In China, the internet space is at least as juicy as anywhere else, except younger. In the UK, internet advertising is now into double digits; in China it stands at five percent, but you won’t believe the expected growth trajectory.

And, like anywhere else, the shift to online life is causing tremendous shifts in social behaviour. The latest world trend is social networking, but in China that has been a high-growth area for more than five years. There are obvious (if sometimes strained) parallels between online growth and urbanisation. Except I can’t find an online equivalent of Chongqing’s Urban City Planning Exhibition Center, not even when it comes to planning within a single business.

It almost makes you long for the comfort of central planning...