The Internet and the 'market revolution'

Hamish McRae: The internet has shifted the balance of power

http://comment.independent.co.uk/columnists_m_z/hamish_mcrae/article2296811.ece

Published: 23 February 2007
It is what in theory ought to happen - but it is good to know that it is indeed happening. In theory the development of the internet is hugely democratic. It gives all of us the access to knowledge that a decade ago would have required a research department in a multinational. But it takes a while for people to figure out how to use the new technologies and for the services distributed through those technologies to be developed. Email, broadband, Google, eBay, Youtube, Skype and other ventures are changing the balance of power between the individual on the one hand and the state and big companies on the other.
The past few days have seen examples of this shift of power. The ability of consumers to compare gas prices has combined with market liberalisation to enable us to switch to the supplier which can offer the best deal, as Centrica has found to its cost. The power of the net has given bank customers the confidence to complain about charges, plus the mechanism for so doing. The easy access to email has enabled 1.8 million people to protest to No Ten about road charges.
This shift of power has happened as part of a wider market revolution. There would be less point in being able to compare gas prices if, as in many countries, you could not switch suppliers. But even where there is a monolith on one side of the equation, the very fact that individuals have access to global information changes the balance of power between them and it.
We are still in the early stages of this shift. But already we can pick out some of the consequences.
One is a sustained increase in the power of the consumer. We are already able to seek out good deals and compare quality as well as price but it takes time to do so and poor suppliers are not immediately punished. In the future they will be, forcing up the quality of goods and services further.
A second is a decline in the power of the expert. For example, doctors' prescriptions can be checked for their effectiveness - and checked globally. Incompetence can be spotted, challenged and punished.
A third is a decline in power of politicians, or more accurately, much more pressure on politicians to do what their electorate wants.
On the other hand the benefits of this "net democracy" only accrue to those individuals who are well-educated enough to take advantage of them. We have to have access but we also need to know how to use the flood of information now available. As with all advances - and this is a huge one - there are people who are left behind. Society needs to look after them too.