San Francisco-based Helium launched a new wireless communication standard today that it is calling "LongFi." It has 200x the range of WiFi and operates at 1/1000th the cost of a cellar modem. It is perfectly suited to IoT (Internet of Things) devices, such as the electric scooters that are proliferating across our cities. Helium's goal is to build out the "world's first peer-to-peer wireless network."

What's potentially very exciting about this technology is that it represents decentralized network infrastructure. Anyone can install a Helium Hotspot in their home (to grow the network). And if you do that, you'll be rewarded with tokens, which, in theory, will have some value going forward. Another way to think of a Helium Hotspot is as "the equivalent of bitcoin mining for network infrastructure."

Put yet another way, it's a new kind of wireless protocol and an entirely new business model -- which is often how startups end up beating entrenched incumbents. Here is a short description from Union Square Ventures (an investor in the company) on how the Helium network will work:

Hotspots, the backbone of the Helium network, can be deployed by anyone, anywhere, simply by plugging into an existing router.  The Helium network will be assembled, over time, by a broad community of volunteers, civic organizations, commercial partners, and ideally a new class of entrepreneurs building out connectivity in new cities and towns.

Economic activity in the Helium network is coordinated through a new type of blockchain that uses “proof of coverage” (proving that a Hotspot is actually located in physical space) to secure the network and incentivize deployment where it is needed most.  We believe that the Helium network has the potential to become one of the most decentralized blockchain networks in existence, due to physical location as the underpinning of the economic and security model.

This is a good example of the potential of the blockchain technology. We are still waiting for mainstream consumer applications to be built on top of it, but many people within the industry believe we're only a few years out from that. I'm going to try out a Helium Hotspot as soon as they're available in Toronto.

Images: Helium

Albert Wenger of Union Square Ventures recently gave a talk at the 2017 Blockstack Summit about “Decentralization and the Knowledge Age.”

He starts by talking about motivation and coordination.

The state, he argues, is good at coordination, but not so good at motivation. The market, on the other hand, is good at motivation, but not so good at coordination. Money and self-interest are powerful incentives.

He then talks about how networks have improved the market, the firm, and the state. When the cost of sharing information drops, everything gets better.

But there are downsides to networks. For one, they form monopolies. Consider Facebook in social. Google in search. Amazon in ecommerce.

They also create environments ripe for censorship and “algorithmic abuse.” Everything you see in your feeds is optimized to make you respond and/or feel a certain way. The line between delivering you relevant content and deliberate manipulation is perhaps a fine one.

So what’s the solution? Decentralized blockchain networks are one exciting possibility. But they also have their own limits and drawbacks. Albert touches on those in his talk.