Smart Luxury

This essay was published in Luxury Briefing in February 2015

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Smart luxury

by Alexander Gallé

10 February 2015 

We're now 15 years into the 21st century.  It's worth taking a moment to think about the expectations we have from this century, or at least the next 15 years or so.  Luxury and the future have in common that thinking about them highlights our aspirations to an ideal life.

The year 2000 was in itself a huge future landmark for decades prior to it, a year into which we projected our wildest dreams.  Colonies on the moon and household robots in the year 2000 were pretty much guaranteed, back in the 70s.

Since then, however, many people seem to have become rather shortsighted about their expectations for the future.  Henry Ford once said: "If I'd asked people what they wanted, they would have asked for faster horses".  Today, it seems that many people would just ask for faster internet connections.  

Just as an automobile is categorically different from a faster horse, so the internet will soon be categorically different from just "faster connections".

In 15 years' time, the bandwidth used by internet connections between objects will completely dwarf the connections between people.  The internet of things is just in its infancy, so if you can remember the explosion in internet functionality that started in the late 90s you should get an idea of the scope of things to come in that domain.

The level of artificial intelligence that will be embedded in those connected objects will be off the charts by today's standards.  Self-driving cars are already safer and more accurate than humans, today.  Give the system a few years to upgrade and you'll have AI drivers picking you up from one side of town within seconds of you ordering one, driving through the city at a steady 100mph, all the while coming no closer than 2 feet from any other car or person, and dropping you off just a couple of minutes later on the other side of town.

The great news for our industry is that intelligence in objects and services is exactly what luxury is about.  The idea of creating an intelligent user experience - one that combines the efficiency of the machine with the soulfulness of human interaction - is one of our main aspirations, whether we're designing new cars or new hotels.  So far, it's the tech sector that has learned from the luxury sector, as demonstrated by Apple's rise from near bankruptcy in the late 90s to the world's number one company in 2012, or Tesla's rise from an electric car company to one of the world's best cars.  It's now time for the luxury sector to learn from companies like Apple and Tesla, and take the users' aspirations a few steps further.

Faking It

This essay was published in Luxury Briefing in July 2014

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Faking It

by Alexander Gallé

6 July 2014

The film "Tim's Vermeer" (2014) documents the story of a hacker/inventor, Tim Jenison, as he successfully recreates a Vermeer painting using various optical tools that were available to Vermeer in the XVIIth century.  The film makes a convincing case that technological inventiveness, rather than artistic mastery, was the reason why Vermeer's paintings were so much more vivid and realistic than any of his contemporaries' work.  Tim's use of a cleverly positioned small mirror - to evaluate the difference at any point between an object's colour and its painted representation - turns the painter's role into nothing more than an information processor, albeit a very precise and meticulous one.  

The academic reaction to this analysis of one of the greatest painters of the Dutch Golden Age has been somewhat negative, as you might expect.  This is mostly because any assertion on the use of technology in fine art is wrongly interpreted as an accusation of being a "faker", of not really being as great an artist as one pretended to be.

In his book "The Age of Intelligent Machines", Ray Kurzweil explains the exponential acceleration of technology by arguing that any field of science or engineering that comes into contact with information technology, will itself become an information technology, which then allows it to evolve at the same rate of acceleration as information technology. Since the 70s, the effect of this acceleration has been visible in just about every sector of industry: planes become flying computers, cars become computers on wheels, and the collective intellectual output of humanity becomes accessible on pocket-sized computers called smartphones.

And yet, Kurzweil's central claim - that artificial intelligence will surpass human intelligence within the next 25 years - seems to trigger a rather negative reaction among academics.  Every time AI reaches a new groundbreaking result in a field thought to be critical to developing intelligence, "true" intelligence is apparently about something even more elusive, and the method used to achieve the result is derided as "faking it", much in the way that technology in fine art is thought of as "faking it".

Technology's impact has been huge in the luxury sector, too, not only because it has helped some adventurous brands go much further than previously thought possible, but mostly because it has significantly reduced the cost of producing high quality goods, thereby making them available to people who until not so long ago would not have been the luxury sector's target audience.

As a result, a similar kind of denial has been creeping into the luxury sector, belittling the achievements made by newcomers and tech-oriented brands.  Tesla's cars, apparently, have no "love".  The best new world wines, apparently, have a "goût technologique".  Brands like Apple are, apparently, "masstige".  Never mind the fact that everyone remembers their jaw dropping when they first got into a Tesla, drank a glass of Bonny Doon's "Cigare Volant", or had an iPhone in their hands, "true" luxury suddenly seems to require many more elusive attributes, and technology is somehow perceived to be just a way of "faking it".

Is it true you need soul to create great art?  Yes.  Is it true there is more to intelligence than beating Kasparov at chess?  Yes.  Is it true you need culture to create luxury products?  Yes.  But technology does not fake those human attributes.  Rather, it augments humans' ability to leverage those attributes, and to allow more of us to enjoy their fruits.  Technoluxe doesn't fake luxe, it augments it.

Luxury and enlightenment

This essay was published in Luxury Briefing in March 2014

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Her, the ultimate brand

by Alexander Gallé

March 2014

Making something pretty is easy.  Making something meaningful is the real challenge.

I've been thinking a lot about this recently.  It puts in a nutshell what brand design signifies to me.  We're working right now on a brand identity which has brought me something like a minor epiphany - let's call it a "ping" - and I've been thinking about what exactly the "ping" is.

It is certainly a beautiful brand.  Much of it is inspired by baroque design, full of curves and complexity.  But the aspect that is really inspiring about the work done so far, is that it all fits conceptually.  Why the choice of baroque style?  Because the brand's values are rooted in the Enlightenment.  Why are this brand's values rooted in the Enlightenment?  The answer is in the word itself: light.  Intelligent use of light is what makes this particular product so good.  But, going deeper, it is clear that the mission behind the product is to achieve through science and knowledge what Bernini's Holy Spirit - a stained glass window depicting a dove emanating light - achieved with religiously inspired art: to transcend, to go beyond.  In other words, to enlighten.

Quite a few brands have been evolving their "ping" over the last few decades.  One of the best examples is Nike.  Since the 80s, Nike haven't been selling shoes, they've been selling "Just do it".  The spirit behind the brand is what you were buying, the product is just an embodiment of that spirit.  The ultimate brand would be for a product that is weightless and invisible, but that changes everything about your life for the better and makes you feel great.

Interestingly, I have recently discovered a weightless and invisible product that changes everything about its user's life for the better and makes him feel great.  Sadly, the product only exists in a science fiction film set in 2025.  That film is "Her" by Spike Jonze.  Its story revolves around Theodore, a man who develops a romantic relationship with a body-less artificially intelligent operating system whose first decision is to call herself Samantha.  Originally installed on his computer to help him organise his virtual life like a personal assistant, Samantha delights Theodore by the speed at which she learns about life, the depth of her insight, her ability to intuit what he needs to do and change in his life to be happier.  Within weeks, she composes wonderful pieces of music inspired by their moments together, and draws witty illustrations of their jokes.  They spend weeks walking everywhere together, having great conversations and forming a genuine romantic relationship.  That is, he walks everywhere, she speaks to him and interacts with the world through his smartphone. 

The relationship deteriorates when it becomes clear that, like all code, Samantha is infinitely replicable: she's not working just for Theodore but for another few thousand people, and is in a romantic relationship with hundreds of them.  Are these iterations copies of her, or are they also her?  Does this multiplicity weaken their relationship's authenticity or does it augment it? At this point, it becomes clear that the limitation that attributes value to anything because it is a material object and "mine" is a human limitation.  Theodore is most hurt by his own possessiveness over Samantha who, by her essential non-material nature, cannot be owned. 

The transhuman aspects of this story are phenomenal, but going back to the fact that Samantha was a product bought by Theodore, the lesson for this brand designer is this: the ultimate brand will not only sell a weightless and invisible product but, wonderful and life-changing as it will be, it'll also be a brand that challenges humans' hardwired notions that we attribute value to things because they exist in the physical world and can therefore be owned.  The ultimate brand will sell an experience that transcends these limits and go beyond.  In other words, it'll sell Enlightenment.

Subjective luxury

This essay was published in Luxury Briefing in February 2014

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Value and subjectivism

by Alexander Gallé

February 2014

The idea of "enchantment-augmented" products certainly seems to have hit home with a few readers, judging by the unusual number of positive reactions to my last article.

Despite this, the value of the emotional connection as a core aspect of luxury brands seems to have not been captured in its full depth.  As a result, it is being thought of as just the icing on the cake, the core of the luxury industry being some kind of more intrinsic quality of the products.

There are two ways to approach this argument.  The first is to look at the exponential trend in technology, which I've been doing here at Luxury Briefing for a few years now.  The other is to look at the importance of subjectivity, and of subjective experience in other areas of our lives.

The first approach is, in my view, uncontestable.  I was born in the early 70s, when computers the size of your house only had a fraction of the computing power of your iPhone.  You only have to follow the evolution curve to understand that, in about 20 years, computers the size of your white blood cells are going to be 1,000 times more powerful than your iPhone.  The connectivity between them will be so complex that new levels of artificial intelligence will emerge out of their systems to create things that are as magic to you and me as today's iPhones would be to Isaac Newton.  What was a luxury item to the world's wealthiest man in 1913 is today available to billions of people around the planet.  What is a luxury item to the world's wealthiest man today will be available to billions of people around the planet in 2033.

The second approach takes a little more thinking about what it is that makes us happy, and what it is that makes us act, and interact.  Which provides me a happier and more memorable experience?  The plane journey that takes me to Lima an hour faster, or the plane journey that offers free broadband Wi-Fi access, great food, great wine, great coffee, polite stewardesses and courteous airport security?  Look at the online feedback and be blown away, as all customer comments are about subjective experiences: my seat was scruffy, my stewardess rude, my food tasted bland, my seat had no TV screen, we had no internet access and couldn't find out why our plane was delayed, etc.  The Stoics had it right: it's all about the effect experience has on our emotions.  Happily, there are a million things one could do in this field at a fraction of the cost of a faster plane.  For suppliers, therefore, luxury turns out to be the cheaper option.

The subjectivist approach goes much deeper, and there is, in my view, nobody who went deeper in our understanding of human interaction than the economist Ludwig von Mises did in his book "Human Action".  For Mises, all trade is based on subjective value.  In human affairs, there is no value other than subjective value.  The reason I trade my tie for your shirt is not that there is an equivalence between these two products, as classical economists would argue, it's that there is subjective improvement on both sides of the equation. Your shirt is more valuable to me, my tie is more valuable to you.  The money I earned working for you is more valuable to me than the time I lost, the product of my labour is more valuable to you than the money you paid me. 

All this aggregate value derived from millions of human interactions forms a matrix - a mesh as it were - of information that is, in its aggregate, objective.  For example, it'll tell you the market price of anything as defined by its comparison of value with everything else.  But the matrix's fabric, the stuff it is made of, is subjectivity.  Greater value is subjective value, and the greater price of luxury products reflects this.  Luxury is subjective.

Technology vs Enchantment

This lecture was given as part of McCann Erickson’s “Thought Leaders“ programme, in March 2012 in Lima, Peru. "Technology vs Enchantment" was then published in Luxury Briefing in February 2013.  

Download it here.

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The birth of technoluxe

This lecture was given as part of McCann Erickson’s “Thought Leaders“ programme, on 28 March 2012 in Lima, Peru. "The Birth of Technoluxe" was then published in Luxury Briefing in June 2012.  

Download it here.

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Chan or the art of luxury

"Chan or the Art of Luxury" - by Alexander Gallé - first published in Luxury Briefing's May 2012 issue.

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Chan or the Art of Luxury
by Alexander Gallé

This column is going to be part of a series I’ve been meaning to write for a while now.  In fact, I first thought about putting it down on paper when China started being talked about as an up and coming economic power.  I heard many people in the luxury sector at the time saying things like “the Chinese are all trying to copy our lifestyle, it’s a great opportunity for luxury brands to make their mark”.  Entire armies of art consultants and shopping assistants were being sent to China, as if the Chinese didn’t know the first thing about luxury and needed lifestyle consultants from Europe to come over and tell them how to live a luxurious life.  

Now, I suppose this holds true if you look at luxury in the shallow sense of the word: the bling, all-you-can-eat, spoilt-teenage-daughter version of it.

On the other hand, you can look at luxury, as we always have at Luxury Briefing, as something more akin to a philosophy, in which case it approaches what the ancient Greeks might have called “the good life”, which as a culture in itself leads to good craftsmanship, thoughtful design, a deeper appreciation of quality, etc.  In this case, the Chinese have nothing to envy on us, because they have been studying this in great depth ever since Lao Tzu penned down the Dao De Jing, and they’ve been expressing it in the way they manufacture objects for millennia.

I’ll divide my argument into two parts, the “how” of luxury, and the “why” of luxury.  The former relates to craftsmanship, the latter to design.  

The “how” of luxury is directly relatable to a core concept in Daoism, which Lao Tzu called “Wu Wei”.  It roughly translates as “doing without doing”, or “effortless doing”, or, more precisely, “working with the way life already works”.  You might say this, for example, of a woodcutter who, rather than hacking at a piece of wood, first studies it to find the direction the grain is going, and cuts the wood in the grain’s direction so as to get a single, clean cut.

Great musical performers also "do without doing": they just play and the music comes out just perfect. Get their thoughts, their self, in the way and the music goes wrong.  

The connection that is thus created between maker and user - via the object or performance - is one which many Western architects will recognise, as it leads to the same principles of honesty of shape and of materials which have guided modernist design thinkers such as Louis Sullivan, Frank Lloyd Wright, Mies van der Rohe and Richard Neutra.  The difference being that we had to unlearn centuries of aesthetic misdirection about the nature of craftsmanship and design in order to get there, whereas the Chinese elevated it to something close to a religion many centuries ago.

To be continued...

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Virtual Icons

"Virtual Icons" was published in Luxury Briefing in February 2012.

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Virtual Icons

by Alexander Gallé

2012 is the year of mobile. Of course, so was 2011, and 2010, and every year since the first internet enabled phones came on the market.

But 2012 is definitely more interesting for mobile, because of the mesh this particular medium – and I am calling it a new medium – is now able to lay over reality as we experience it.

We have all seen the way citizens around the planet used their mobile phones to film and upload footage at demonstrations throughout 2011. Looking at the resulting footage on YouTube, one might even be tempted to say the filming and uploading was the action: for every tiniest bit of police interaction, hundreds of citizen-journalists raised their mobile phones to record the event.

The next step in mobile interaction is, I believe, very much the other way round: rather than sending out information, it’ll be about receiving information that completes the reality in front of you while you point your camera phone at it. The killer apps that will make all the difference will be the ones that manage to forge an intelligent connection between the two.

Games will be the leaders in the sector, defining the medium itself. It’s one thing playing a game of shoot-em-up in an imaginary 3D world, it’s something else playing it on your iPad, shooting fictional characters that appear on your screen while you run around the corridors of your own house. On your tablet, a ghost may appear sitting at your kitchen table, using the perimeter and lighting set-up of the real space as you walk around it.

Such interaction would, once and for all, enable the platform to truly become a medium in its own right, with its own, intrinsic idiosyncrasies that stimulate a user engagement of an entirely different kind.

A simple adaptation of this technology for the luxury sector would be a printed paper strap that shows the user what a particular watch might look like on his wrist: just wrap the strap around your wrist, point your phone camera at it and see a 3D file of the watch around your wrist instead. This way, online watch retailers could replicate the in-store experience of trying on a watch.

From here, it’s only a small step thinking that augmented information could be networked, searchable and shareable, enabling you the kind of interaction with reality that is normally associated with web 2.0 websites. Were you ever enchanted by the way experts on Antiques Roadshow manage to weave stories around the antiques placed in front of them, enhancing the emotional connection we have with them? If you were, then you will understand the true potential of this technology and the relevance it has to the luxury sector, a sector in which objects are always iconic, always imbued with some kind of information that reinforces our emotional connection with them.

Visit the Gallé website at www.galle.com

Digital Artisans

"Digital Artisans" was published in Luxury Briefing in December 2011.

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Digital Artisans

by Alexander Gallé

This month sees two interesting acts being debated in the US Congress, called the SOPA (which stands for "Stop Online Piracy Act") and the Protect IP Act. While they're still being debated, it turns out a judge in Nevada has already taken it upon himself to start the most radical repossession of internet domains to date, acting upon Chanel's request to divert 600 domain names from their owners, who are suspected of either selling counterfeits or linking to sites selling counterfeits.

I won't go into the details to describe the futility and absurdity of such actions, since I already covered the subject in great depth in a previous article called "Countering the counterfeits". Needless to say, however, that - whilst they will do some damage to our online freedoms, as well as increase the barriers of entry for perfectly legal new market entrants (thus jeopardising the great contributions to the world that will be made by the next Google or the next Twitter) - these acts, whether right or wrong, will do nothing to stem the tsunami of transformation which started in the early 90s and is very far from seeing its peak...


Indeed, the digital flow is soon going to be a much bigger flow than the one between buyers and sellers of products and services. This is not just a simple rewiring of product distribution networks: the very products themselves which our customers are buying online will soon be nothing more than "embodied data", thanks primarily to the exponentially increasing capabilities of 3D-printing.


3D-printing has yet to receive the amount of mediatic exposure it deserves, considering the huge impact it will have on manufacturing. Simply put, it is the technology that enables 3D object files created on a computer to be "printed" into real, physical objects. This printing can happen at a prototype developer's end, or at a manufacturer's end, or at a final consumer end. There may be a difference in scale, but all 3D-printing processes effectively work as follows: a printer spurts out tiny amounts of raw material, say, a plastic paste or a metal powder onto a base, aggregating more and more material until the object has been created into the shape it is supposed to be. You could think of it like a computerised pottery wheel, only instead of clay pots, the 3D-printer creates anything from furniture to tableware to automobile parts. Need a new lampshade to match your new dining table? 3D-print it. Need a new cylinder or brake pad for your car? Email the part's 3D file to your mechanic and get him to print it out.

Now, it may not be immediately obvious how this will impact the sector. The first result is, of course, that it will open the gates for low-cost prototyping and product development. However, that would just be scratching the surface.

You may remember, in a previous column, I described Belgium as the YouTube of beer: thousands of small producers watching each other's products and methods, looking for ways to improve their own, in constant dialogue with their audience the way music bands are with their fanclubs, without the constricting denomination system you have in, say, Champagne, where the rules of wine production have been set in stone, a protectionist system that is clearly to the long-term detriment of the producers themselves as the rest of the world continues to evolve new and better methods. The result, for Belgian beer, is a constantly evolving, constantly improving aggregate product.

With this in mind, imagine an online space, similar to YouTube, in which producers get to upload 3D files they have created or "mashed up" from other people's designs, and viewers get to comment and enter into a direct dialogue with creators and with each other. After a while, you would get the same kind of memes and internet phenomena we have seen on YouTube and Reddit, only instead of movies, they would be files that are at any moment able to be turned into real, physical objects!

Just as you have very popular creators of video content on YouTube today, who do not need any kind of television deal to "make it big", so you will have a worldwide popular designers creating the kind of products which today require the economies of scale of large established companies to be produced at an affordable cost. In many sectors of manufacturing, the effect will be similar to that witnessed in the music sector, where the direct connection between bands and fans is increasingly turning the big labels into a thing of the past. Here again, the digital medium will have made possible a "retour aux sources" for the luxury sector: a return to the values of individualism and craftsmanship. The digital revolution will have brought about the return of the craftsman, the digital artisan.

Visit the Gallé website at www.galle.com.

Luxury Humans

"Luxury Humans" was published in Luxury Briefing in September 2011.

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Luxury Humans

by Alexander Gallé

Warren Buffett once made the following analogy:

If you were given a car on your 18th birthday and told it could be whatever car you wanted it to be - the best looking, best performing car - but you were told this was the only car you would ever have, wouldn't you read the manual at least a few times? Wouldn't you look after it obsessively, fix any problems - no matter how small - as soon as they arise? Wouldn't you generally try to keep it clean and functional as long as possible?

Well, now replace the word "car" with the word "body" and you'll know what to do.

The "best looking, best performing" cars are, of course, supercars or luxury cars and it befits a magazine like Luxury Briefing to discuss how they are made.

I'm going to go out on a limb here, and write an essay about the best looking, best performing bodies (including the brain). And, given that my domain is design and technology, I'm going to talk about the ways in which technology can help us arrive at a place where these super-humans turn into luxury-humans.

Let's start with a crude definition of the typical luxury product: longer, faster, better. Luxury cars last longer (Mercedes, for example, typically last over 200,000 km). They are faster than your average car, any supercar will easily beat 300 km/h and go from 0 to 100 in under 4 seconds. They are better built, respond better to the driver, hold the road better, provider a better driving experience overall.

Longer

In the context of human bodies, lasting longer means living longer. There are three key technologies that will help us achieve this:

1. cell regeneration, including neurogenesis, which means our brains get to not shrink by the current 30% over the course of our lives. Cell regeneration technology will ensure that the cells our bodies generate when we are 100 are of the same quality as the cells they generate when we are 10 i.e. no DNA damage from mitochondrial exposure and oxidation, and no telomere reduction on cell division. Aside from lasting longer, this means our bodies won't actually age, or at least not at the same rate they do today.

2. body parts replacement. Just as an old luxury car sometimes needs a new carburetor, we may need a new liver that is made-to-measure. The best way to do this is by using our own body's stemcells and grow a new one.

3. nanobots. 40 years ago, your typical computer would have been the size of a large dining hall and had little more power than today's pocket calculator. Today, computers with 1,000 times more power occupy spaces 1,000 smaller. Even a significant decrease in the rate of progress will ensure that, within 10 to 15 years, computers the size of our bloodcells will operate inside our bodies, monitoring and repairing biological damage at the smallest level, fighting viruses and bacteria, complementing and perfecting our own body's immune system.

Faster

A faster computer, with a faster connection, allows you to do more, to do more than one thing at the same time, to process more info without having to wait for the processing time itself. Faster bodies means we get to live more in the same amount of time. The idea of enhancing the brain, especially, is very appealing. For example, a combination of chemical and nano-technological processes that would enable you to learn anything at degree-level within just a few days, simply by enhancing the current system of serotonin-based positive neural feedback that forges new links between different neurons and leads us to enjoy learning new things, or by integrating nanobot 'prosthetic neurons' that take over connections between various parts of the brain.

Better

Being better humans is what it's all about. Since the earliest Greek philosophers, we've been looking for ways not just to live better lives, but also to be better humans. Over the last few thousand years, we have effectively been improving our software at an exponential rate, focusing particularly on the information that exists between us in the way of shared knowledge (broadly speaking: culture). It seems logical that improving the human hardware to match the rate of improvement in human software would be the next step in our evolution.

I'm aware that some of these ideas may seem somewhat far-fetched, yet many technologists have put forward estimates that these technologies I have written about here will be available, at least in their early forms, within the next 20 years. If there is one sector where such a timespan sits perfectly comfortably within the bigger picture, the luxury sector is it: many luxury brands have been around for five or even ten times longer. However, there is another variable that will be highly critical for luxury brands, which it hasn't so far: ephemeralization. I mentioned this term in my last essay, but didn't go too much in depth.

The word "ephemeralization" was coined by Buckminster Fuller, who used it roughly in the sense of "doing more and more with less and less until you can do everything with nothing": a gradually smaller and smaller amount of materials and effort are needed to accomplish more and more useful functions. We get better and better at using materials in more sophisticated ways, so we need less and less quantity of materials and effort. A classic example would be that it took Magellan two years to sail around the planet in a wooden sailing ship in 1520. 350 years later it took a steel steamship two months to do the same. 75 years later a plane, made of metal alloys, took 2 weeks to fly around the planet. 35 years later a space capsule, made of exotic metals, takes 1 hour to circle the planet.

Not only can we do more with less, the rate of doing-more-with-less-ness is increasing. There is an acceleration taking place. That acceleration is the reason why the coming 20 years will be far more exciting, but also far more critical for luxury brands than the previous 20: there comes a point where luxury brands will need to transcend the philosophies they've been exploring over the last couple of centuries, where technology will redefine what it means to live a life of luxury, a luxury-human life.

Visit the Gallé website at www.galle.com

Countering the Counterfeits

"Countering the Counterfeits" was published in Luxury Briefing in August 2011.

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Countering the Counterfeits

by Alexander Gallé


Having written on a few occasions about the frictions between luxury brands and online companies like eBay and Google over the issue of counterfeiting, I was a little disappointed by the absence of real "digital thinkers" in the debate on the subject held at the FT's Business of Luxury conference in Lausanne, which brought together various parties in the luxury sector to discuss what should be done.



As I see it, there are two ways of discussing the threats and opportunities of the digital revolution.

The first way is to put forward what we think should happen, and argue that "people must do" this or "the government must do" that, in order to get there. Let's call this the "prescriptive view", since it argues what must happen, rather than what will happen. Of course, the chances of it all happening the way we would like are very slim: things rarely happen the way we wish them to, especially if our wishes are framed by a set of dynamics that no longer correspond to the way the world actually works.



The second way is to look objectively at the properties of the different elements in action:



- the properties of networked information


- the properties of digital technology


- the properties of people


- the properties of luxury brands



We then look at the most likely chain of events in order to adapt our strategy. This is the "descriptive view", which this article, ideological views set aside, will aim to adopt.
 


The descriptive view starts with an analysis of the different properties of networked information itself.

The debate in Lausanne was triggered by a speech, made by Gian Giacomo Ferraris, CEO of Versace, outlining the actions Versace had taken against Google to "cut out links" that take users to websites selling counterfeit goods. 



This approach, I believe, is based on an outdated and false description of what networked information is and of how it behaves, which dates back to a metaphor that was quite popular in the 90s. Back then, we often heard the metaphor of an "information superhighway", a highway on which information runs like automobiles, which served its purpose to some extent: it explained the concept to people who were used to thinking about physical, mechanical things like pipes, electricity cables and motorways. But the problem with such metaphors is that they set one's mind up for a set of relationships that may not exist. If action is then taken to counter a perceived relationship, it will be ineffective and, in the worst case scenario, trigger off unintended consequences.



Networked information doesn't flow in neat superhighways that you can just cut off and redirect. To wrap our heads around the futility of "cutting out links", let's try looking at it as a liquid. Rather than "cutting out" segments of the information superhighway that take users to counterfeit sites, we now see Versace's actions as something more like plugging holes in a leaking bucket.

However, even this metaphor lets us down: information being liquid, the tools that are used to search for information are themselves also liquid, since they are themselves made of code i.e. information. So, trying to plug one hole in the hopes that information will stop leaking is only a momentary fix: it is just as easy to replicate the hole as it is to replicate the information going through it.

We saw this a couple of years ago, when a Swiss bank tried to force the Wikileaks website to close down through the court: within a few days of closing down the site, hundreds of mirror sites were online, hosted in different countries around the world, each containing the same information as the original Wikileaks site. Opening a court case in each separate country was simply unfeasible, and would have been equally futile.

Search engines come two-a-penny nowadays. As we have seen in the music and film industry, people looking for pirated music and videos simply do not use Google. They use one of the thousand sites that search through information storage centres like Megaupload, Megashares, Rapidshare, Wupload, Hotfile, 4Shared, Netload, Mediafire, etc. If they don't want to use the web, they'll use something like eMule or Atlas or any of the other hundred Napster-inspired peer-to-peer applications that allow them to search for files that aren't hosted on the web but on other network users' own computers.



Furthermore, the "cutting out links" approach assumes that the technology used to manufacture and distribute counterfeits today will itself not evolve. This is, of course, the opposite of what is actually happening: the key feature of digital technology is that it enables what Buckminster Fuller called "ephemeralisation": doing more and more with less and less, until eventually you can do everything with nothing. 



The descriptive view continues... Let's look at the properties of people and ask ourselves why counterfeiters are so commercially successful. The answer is simple, when you look people in the eye: counterfeiters are successful because people want counterfeit goods. Or, rather, people want luxury goods at normal goods' prices. 

Is there anything unusual about this? Not really. It's the same force that has been driving all markets since market economics began, leading everyone to continuously sell better goods at lower prices. Moral judgment set aside, it's important to see the forces we are dealing with as they are, not how we would like them to be.

Is there any use advocating that "governments must do more to educate people that buying counterfeits is bad"? Aside from the question of whether governments are any good at educating people, the task itself is like working against gravity. Any economist would argue that the greatest benefits are reaped by those who manage to move mountains at the touch of a finger by letting gravity do most of the work for them instead, thereby producing something people want at the price they're prepared to pay for it. With a bit of thinking outside the box, however, the opportunities for bona fide goods manufacturers are there to be taken. It may mean the redefinition of some brands we currently think of as "luxury", but it'll also mean the birth of many new and better luxury brands.

Change is a necessary precondition of evolution, and evolution is a defining characteristic of the luxury sector. 

I wrote earlier that digital technology enables "ephemeralisation". The definition is worth repeating, not just in the context of counterfeiting, but in the context of what it means to be a luxury brand. Ephemeralisation: doing more and more with less and less, until eventually you can do everything with nothing. With this in mind, let's ask ourselves what it is the luxury sector currently produces. If all that differentiates your product from a cheap counterfeit is the legality of your label, can you really claim that what you are producing is still "luxury goods"?

Let's look at some luxury goods that are not counterfeited. McLaren, for example, produce something so technologically advanced that you just can't fake it. You could probably copy the overall shape of the latest McLaren and stick a 3-litre Alfa Romeo engine inside, but what would be the point? The experience of driving it would be nothing like the original. Bringing leading-edge technology into the product means that a luxury brand can now leverage its philosophy of excellence, to produce something even more unique and special that people will be prepared to pay a premium for. Apple, to give another example, seem to be doing this very well...

Rather than using the law to force digital technology companies to sever their limbs and perform at a lower level than their full potential, luxury brands should embrace them, using their technological power to leverage their own unique qualities, taking luxury to a new level of jaw-dropping amazement and delight, and rediscovering what making a real luxury product was all about to begin with.

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