A common thread in our readings this week in Benkler’s Wealth of Networks, Chapter 3 and Kadushin’s, Understanding Social Networks, Chapter 7, is a concept that Clay Shirkey also refers to in Here Comes Everybody. The idea of “costs” as a barrier to group action appears to be a central theme in the social networking literature. The transaction costs view of markets and firms is at the core of Clay Skirkey’s “institutional dilemma” (p.19) where he uses the Coase theory (Ron Coase) to reinforce that organizations live in a contradiction – it takes advantage of its employees group effort, but some of its resources are drained away by managing that effort. Firms want to lower “transaction costs”. For anyone who has worked for a large organization – you may have experienced frustrations of time delays in decisions, or too many unproductive meetings or dated processes – these are inefficiencies – transaction costs. For example, consider the idea of putting a diverse, international work team together. This would require recruiting, coordinating and sustaining the effort — considerable costs that might have prevented the idea from proceeding a few years ago. New technologies and networks are enabling what once wasn’t logical. The old structures and costs associated with traditional bricks and mortar businesses are being rewritten. Benkler brings out the examples including Wikipedia and Open Source software like the GNU/Linux operating system and the NASA Clickworkers Case study – all fine examples to reinforce Benkler’s/Shirkey’s “proof “ that new social media tools are successfully breaking all the old rules by rallying unpaid volunteers to produce an excellent product, with a mass following of customers while functioning without a profit motive. Winning!