In this chapter, we will look at how the internet has opened the world to globalization. We will look at where it began and fast forward to where we are today. We will be reviewing the influences of man, machine, and technology that enables globalization. It is now just as simple to communicate with someone on the other side of the world as to talk to someone next door. In this chapter, we will look at the implications of globalization and its impact on the world.
What Is Globalization?
Globalization is found in economics and refers to the integration of goods, services, and culture among the people and nations of the world. Globalization has accelerated since the turn of the 18th century due to mass improvement in transportation and technology. Globalization has its roots as far back as an exploration of finding the New World. Globalization creates world markets. Places that were once limited to only providing goods and services to the immediate area now have open access to other countries worldwide. The expansion of global markets has increased economic activities in the exchange of goods, services, and funds, which has created global markets that are now readily feasible. Today the ease of the connectivity of people has accelerated the speed of globalization. People no longer have to sail for a year to share goods or services.
The internet has connected nations together. From its initial beginnings in the United States in the 1970s to the World Wide Web development, it has crept into home use with the introduction of the personal computer by the 1980s. The 90’s then introduced social networks and e-commerce of today; the Internet has continued to increase the integration between countries, making globalization a fact of life for citizens worldwide. The Internet is truly a worldwide phenomenon. By Q3 of 2020, approximately 4.9 billion people, or more than half of the world’s population, use the internet. For more details, please view the data at internetworldstats.com/stats.htm.
The Network Society
In 1996, social-sciences researcher Manuel Castells published The Rise of the Network Society. He identified new ways to organize economic activity around the networks that the new telecommunication technologies have provided. This new, global economic activity was different from the past because “it is an economy with the capacity to work as a unit in real-time on a planetary scale.” (Castells, 2000) We are now into this network society, where we are all connected on a global scale.
The World Is Flat
In Thomas Friedman’s seminal book, The World Is Flat (Friedman, 2005), he unpacks the impacts that the personal computer, the Internet, and communication software have had on business, specifically its impact on globalization. He begins the book by defining the three eras of globalization:
- “ Globalization 1.0″ occurred from 1492 until about 1800. In this era, globalization was centered around countries. It was about how much horsepower, wind power, and steam power a country had and how creatively it was deployed. The world shrank from size “large” to size “medium.”
- “ Globalization 2.0″ occurred from about 1800 until 2000, interrupted only by the two World Wars. In this era, the dynamic force driving change was multinational companies. The world shrank from size “medium” to size “small.”
- “Globalization 3.0″ is our current era, beginning in the year 2000. The convergence of the personal computer, fiber-optic Internet connections, and software has created a “flat-world platform” that allows small groups and even individuals to go global. The world has shrunk from size “small” to size “tiny.”
According to Friedman (2005), this third era of globalization was brought about, in many respects, by information technology. Some of the specific technologies he lists include:
- The graphical user interface for the personal computer popularized in the late 1980s. Before the graphical user interface, using a computer was relatively difficult. By making the personal computer something that anyone could use, it became commonplace very quickly. Friedman points out that this digital storage of content made people much more productive and, as the Internet evolved, made it simpler to communicate content worldwide.
- The build-out of the Internet infrastructure during the dot-com boom during the late-1990s. During the late 1990s, telecommunications companies laid thousands of miles of fiber-optic cable worldwide, turning network communications into a commodity. At the same time, the Internet protocols, such as SMTP (e-mail), HTML (web pages), and TCP/IP (network communications), became standards that were available for free and used by everyone.
- The introduction of software to automate and integrate business processes. As the Internet continued to grow and become the dominant form of communication, it became essential to build on the standards developed earlier so that the websites and applications running on the Internet would work well together. Friedman calls this “workflow software,” by which he means software that allows people to work together more easily and allows different software packages and databases to integrate easily. Examples include payment-processing systems and shipping calculators.
These three technologies came together in the late 1990s to create a “platform for global collaboration.” Once these technologies were in place, they continued to evolve. Friedman also points out a couple more technologies that have contributed to the flat-world platform – the open-source movement (see chapter 10) and the advent of mobile technologies.
The World Is Flat was published in 2005. Since then, we have seen even more growth in information technologies that have contributed to global collaborations. We will discuss current and future trends in chapter 13.
Castells, Manuel (2000). The Rise of the Network Society (2nd ed.). Blackwell Publishers, Inc., Cambridge, MA, USA.
Friedman, T. L. (2005). The world is flat: A brief history of the twenty-first century. New York: Farrar, Straus and Giroux.
Q3 2020 Internet usage. Retrieved December 5, 2020, from https://internetworldstats.com/stats.htm.