They’re Finally Saying Something New About Social Media

by Dan Robles on March 8, 2010

Calculus-fullYes, we know that social media is humongous. Yeah, we’ve all heard the 10 amazing ways to “fill-in-the-blank”. Nope, you are still not allowed to shove your products down the consumer’s throat until you have earned their trust.

Now, all of a sudden, a new idea is emerging…it’s barely an audible chirp, but it will become a tectonic rumble before long:

Social Media is beginning to take on the characteristics of a Financial Instrument.

This is a stunning development with vast implications. Allow me to interpret this excellent article by the respected visionary, Brian Solis, as a basis for my argument.

One thing that everyone can agree on is that “information”, “knowledge”, and “innovation” are related somehow. The problem is that nobody can agree about exactly how they are related. None of the definitions for these terms include the adjacent terms and no algorithm exists which performs the conversions, until now.

Now comes the interesting observation:

They say that Google ranking represents a proxy for knowledge in a knowledge economy. What they mean to say is that the rate of change of information with respect to time can be used as a proxy for real-time knowledge. This is a valid idea because Google organizes the World’s information based on time rates of change of the Information.

Yet “knowledge” can only exist between the ears of breathing, thinking, creating, and acting human beings – one important component for which Brian expands the term “Social Capital”. If we carry his observation one step upstream, we should be able to also say that the rate of change of Social Capital (a component of “knowledge”) with respect to time is a proxy for real-time innovation.

Now this idea should be pegging seismographs and flooding the Valley with the ensuing tidal wave of glee. The implication is that we can now identify and organize innovation by simply measuring the rate of change of knowledge with respect to time that an enterprise induces among social networks in a market. Alas, we can now see the direct Integration of Social Media into the business plan.

Calculus is the science of change.

Definitions are fluid, they must change. Brian Solis has, in fact, introduced the construction of what scientists call a “differential equation”. Much like “distance, velocity, and acceleration” are all defined as a rate change of their adjacent term, so too will “information, knowledge and innovation” become defined.

Economics is the science of incentives

It should not go unnoticed that Bankers are scientists too and “money, interest rate, and market capitalization” are also related by the same calculus. This makes possible the miracles of capitalization, securitization, insurance, diversification of risk, options, hedge funds, etc… For better or for worse, Wall Street lives and dies by this algorithm and so do we.

Let me repeat; social media is taking on the characteristics of financial instruments.

Please, I hope that I am not alone in celebrating this historic moment. Few people may recognize this now, but mankind has just experienced an evolutionary leap in it’s understanding of it’s own nature. Bravo Brian, Bravo.

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