Before I begin, I just want to thank those of you whom I had a chance to speak with last Saturday at the event at Allegheny Landing.  We're very excited about The Point, and hope that you will be also.  The response we received was very encouraging.

As I grow older, I've spent more time trying to understand economics and what it means.  I'll admit that I probably grew up with the prejudice that politics was more important because the imposition of force (the root of politics) seems to be a decisive factor in many instances over the fulfillment of desires (the root of economics) in the great game of history.  That said, in better times, it is economics that shapes so much of our lives and human progress, so I'm trying to better understand.

We live in a very challenging economic environment.  Leaving aside the traditional rub about government involvement and the problems of regulation, I think our larger issue is the societal transformation that is happening as we proceed from an industrial economy to an informational one.  It has cost many jobs, but has also created many opportunities, as we have access to so many new means of communication, such as the internet.

I've been reading about the subject quite a bit (and will be reviewing some books in the forthcoming weeks), and it seems to me that for the first time in history, we might have the potential for an economy of virtue.  Winners in the old industrial regime were those who could produce the most cheaply, quickly, or efficiently, as cost production meant largest market share.  It was a very competitive model, but one that discouraged collaboration, and led to monopolization in many areas.  Obviously, the industrial economy will continue as we still need many material goods, but the difficult thing about that is that the nature of the products themselves ensures this will most often be a race to the bottom.  Good for the consumer, perhaps, but hard on businesses and communities.  Living in Western Pennsylvania, the destructive impact is obvious.

But the informational economy is different.  In so many ways, cost ceases to be the same determinant because the real good provided, data, has such limited actual marginal expense.  For instance, we can produce The Point, depending on what features we choose, with either zero expense to meet our basic needs, or with a minimal expense to provide a higher quality experience.  (We chose the latter, incidentally.)  All businesses living in the digital world have a similar experience in comparison to their previous counterparts, and having information be your key item means that the important issue has evolved.  Customer service is and has always been the key element of successful business, but where cost considerations were king once, in a free market where most information is already free, other attributes become magnified in importance:  accessibility, quality of content, depth of networking, and ambiance.  Those businesses which do best are often those which act best.

In all, this creates a new form of business production, driven not by profit, but by content.  I've had to learn a lot about the difficulties of newspapers, for instance, and they have two huge problems.  First, they can't really afford their own distribution costs for print materials on a daily basis when the same content is available online for free.  Second, their ad revenue from classifieds has shrunken immensely because retailers have their own sites, free sites, and places such as craigslist that are much more efficient, friendly, and free.  When the internet didn't exist, these challenges didn't exist either, and papers served a purpose that the community desired that was not easily filled through another means.  That is changing.

I pick these examples to make something abstract into concrete realities.  The way we charge for things has changed.  For instance, anyone who expects pay media will be able to succeed online is being shortsighted.  There are simply too many other options.  Instead of looking to make money on the product directly, businesses must learn to work with one another, trading goods and services for the networking that exists between them.  In the information fields, this means getting the money from retailers and other businesses because their readers trust their information, and will therefore support their advertisers.  There is more transparency, and with more options, the demands have risen for quality.

Taking a step back, I've been thinking what this means for the economy of the future.  I try often to think of how a region where I live, heavily invested in industrial heritage and with hard working people who are better geared toward that economy, how they can make the transition to a digital future.  I begin to think that path is to embrace the future more fully, and make bets that the world will become more connected.  Ideas travel at the speed of light, but they still need broadband infrastructure, wireless nodes, and as time becomes more flexible, I think the future will see a rise in leisure activities as well.

I call this an economy of virtue not because I think anyone can define that clearly.  But, I say it, because for the first time, the choice has finally shifted from the manufacturers to the consumers, and they will determine what will and will not succeed in a way the old monopolistic structures often could prevent.  It will be interesting to watch and to devel