Global Networks, Linked Cities

Saskia Sassen, Saskia Sassen

• Publisher: Routledge
• Year: 2016
• ISBN:
  9781134954964
• Edition: 1
• Topic: Architecture
• Subtopic: Urban Planning & Landscaping

In her pioneering book The Global City, Saskia Sassen argued that certain cities in the postindustrial world have become central nodes in the new service economy, strategic sites for the acceleration of capital and information flows as well as spaces of increasing socio-economic polarization. One effect has been that such cities have gained in importance and power relative to nation-states. In this new collection of essays, Sassen and a distinguished group of contributors expand on the author's earlier work in a number of important ways, focusing on two key issues. First, they look at how information flows have bound global cities together in networks, creating a global city web whose constituent cities become global through the networks they participate in. Second, they investigate emerging global cities in the developing world-Sao Paulo, Shanghai, Hong Kong, Mexico City, Beirut, the Dubai-Iran corridor, and Buenos Aires. They show how these globalizing zones are not only replicating many features of the top tier of global cities, but are also generating new socio-economic patterns as well. These new patterns of development promise to lead to significant changes in the structure of the global economy, as more and more cities worldwide are integrated into globalization's circuitry. Includes contributions from: Linda Garcia, Patrice Riemens, Geert Lovink, Peter Taylor, David Smith, Michael Timberlake, Stephen Graham, Sueli Schiffer Ramos, Christoff Parnreiter, Felicity Gu, David Meyer, Pablo Ciccolella, Iliana Mignaqui, Eric Huybrechts, Ali Parsa. Also includes six maps.

Part One
The Urban Architecture of Global Networks

Chapter 1
The Architecture of Global Networking Technologies

D. Linda García

The role that communication and information technologies can play in affecting economic outcomes is now widely recognized.¹ Less certain, however, is our understanding of how these technologies will affect the locus of economic activity. Emphasizing the enhanced ability of information and communication technologies to overcome barriers of time and space, a number of scholars contend, for example, that nonmetropolitan areas are less likely to be disadvantaged in the future, given a global economy in which they can access a greater number and variety of resources (Parker et al. 1995; Hudson 1995). Others disagree. They contend that profits and growth opportunities in. an information-based global economy will be ever more closely linked to transaction costs. Under such circumstances, cities—which benefit greatly from economies of agglomeration—will have an even greater economic advantage over nonmetropolitan areas than they have today In fact, cities will themselves be ranked depending on their size and importance, with those at the top of the hierarchy serving as central hubs and access ramps to the global economy (Gottman 1983; Sassen 2000; Castells 1989). Some go even further in characterizing the spatial impacts of communication technologies, claiming that in a networked, global economy, economic activities will become deterritorialized, with resources and power being shifted from geographically bounded nation-states to large transnational firms (O'Brian 1992).

This lack of clarity and consensus can be explained, in part, by the fact that many analysts neither differentiate among information and communication technologies in terms of their capabilities nor characterize them according to how they are each—given their differences—likely to mediate social and economic exchanges.² Communication and information technologies are hardly the same in these regards. One need only compare, for example, the impact of the railroads and the telegraph versus those of the telephone on rural areas. Because the railroads and telegraph were point-to-point technologies, they served to deplete rural areas of their resources. In contrast, the telephone, with its meshed, network architecture, served instead to reinforce local ties. Today's information-based networking technologies are far more varied—as well as variable—than networks in the past.³ Defined by software, and supporting almost all forms of communication, today's advanced networking technologies are extremely flexible and versatile so they can easily be customized to the task at hand. This flexibility means that the impact of today's networking technologies will—to a considerable degree—be a matter of the social, economic, and political forces driving their evolution. Depending on these forces, networking technologies can be designed and deployed either to empower or to weaken the position of parties in an exchange.

To anticipate the architecture of global networks, this chapter first lays out a framework for analyzing and differentiating among networks and their socioeconomic impacts. Next it examines how networking technologies will likely evolve given the technological, economic, and political forces at work. Based on this analysis, the chapter argues that although advanced networking technologies have the potential to promote and sustain more decentralized and widely distributed economic activities, such an outcomes is highly unlikely under the present circumstances. Operating in a deregulated environment, and responding to the most lucrative business demands, networked industries will design and deploy networks to mirror the existing flow of trade and financial transactions between major city regions (Sassen, this volume). Moreover, while operating globally, these industries will at the same time base their organizations in major cities where they can better service their business clients as well as interconnect their networks through central international hubs. The existing first mover advantages enjoyed by these city regions in the global hierarchy will thereby be reinforced as technology networks generate even greater externalities and increasing returns. The increased role of cities and globally networked actors will diminish, but certainly not eliminate, the role of nation-states. National government will continue to play an active role in the economy—both domestically, in setting national priorities, and internationally, by advocating in support of national objectives and on behalf of national economic players.

Communication Networks

Communication processes do not occur in a vacuum; they are facilitated and sustained by an underlying network of individuals, institutions, and technologies that provide the means and mechanisms for formulating, exchanging, and interpreting information, and for creating the necessary linkages among these activities.⁴ As part of the infrastructure, communications networks not only support communication processes; they also mediate them, restructuring the way in which these processes take place.

Networking technologies can affect communication processes in a variety of ways. For example, they can alter the speed and cost of communication, the distance that information can travel within any given time period, the amount of intelligence/functionality that can be transferred, the density and richness of information flows, the relationships and interdependencies among parties to an act of communication, and the perceptions of the parties communicating.

It is these changes in communication processes— and not the actual deployment of technology— that eventually give rise to social and economic opportunities and impacts. Thus, for example, communications technologies such as fiber optics and optical switches, which increase the speed and reduce the cost of communication, can foster economic growth by permitting a greater number of transactions to take place. Similarly, search engines and filtering devices, by restructuring economic relationships and directly linking consumers to the products and services that they desire, can eliminate the role of traditional middlemen.

The technical characteristics of communications networks also affect the way in which networking providers are structured and organized, and the rate at which networking technologies are likely to be deployed and diffused. Thus, for example, the higher the fixed costs of building network facilities, the greater the number of users and applications required to support them, and the greater the likelihood that network providers will vertically integrate themselves (Gong and Srinagesh 1997). Likewise, the more interoperable the components of a network, the lower the costs, the more rapidly it will be diffused, and the greater the prospects for competitive provisioning.

Because the impacts of communication technologies are indirect, however, socioeconomic changes are likely to take place in an evolutionary fashion.⁵ Moreover, the path such change follows is not direct; it zigzags and meanders in response to the openings and obstacles encountered along the way. Technology advances, for example, are tempered by social and economic forces as well as by the historical conditions under which new technologies are brought into use. Made in the context of existing institutional structures, laws, and practices, technology choices will depend on who the key decision makers are; how they perceive their needs, interests, and objectives in the light of new technology; and the power and authority that they have to determine events. To anticipate the architecture of global networking technologies, all these variables must be taken into account.

Networking Technologies

Although communications networks have many properties in common, they are not all alike. They differ with respect to the components that constitute them, their architectures, as well as the capabilities that they can support. Together, these three network aspects help to determine the socioeconomic impacts of networking technologies.

Network Components

Each network component performs a function essential to the communication process. Network components serve not only to determine the capabilities of networks, but also the relationship among their parts. Equally important, components have an impact on the power relationships within a network as well as on the way in which industry players organize themselves to provide services (Hakansson and Johanson 1993). Network functions can be executed via hardware, software, or human "ware."

Whatever their makeup, network components are functionally interdependent; so they must work together for communication to take place. Because of the interdependencies among components, any network changes with respect to them will have far-reaching repercussions (Antonelli 1992). For example, the interdependencies of networking components give rise to both positive and negative externalities. Thus, for example—up until a certain point—adding another participant to a network will likely enhance the value of the network for existing participants. Similarly, new network applications are likely to increase the value of existing applications as well as the value of the network to users (Boyers 1986). On the other hand, to the extent that they cause congestion, additional applications and users can give rise to negative externalities.⁶

These interdependencies and externalities explain why networks, once they gain momentum, assume path dependent trajectories (Arthur 1989: 116-131). Having become part of an established network, users tend to get locked in. Unwilling to forgo the positive externalities, they are likely to stay put. Because networks represent a large installed base, users are, moreover, unlikely to purchase incompatible components. Instead, they may postpone the adoption of new technologies—even when new components are far superior to old ones—until their entire network can be written off. On the other hand—and for the same reasons—if a number of users come to constitute a critical mass moving to a new technology, others will likely jump on the bandwagon, fearing that they will be left behind (Farrell and Saloner 1987).

Network interdependencies are also a source of constraint. Because a network's performance is limited by its weakest link, each component is a potential bottleneck. In today's computer networks, bottlenecks can occur in many places: the rate at which data can be sent from the computer's memory to the network; the time required for data to pass through the links; and the time that switches take to route data to another network node. Unblocking a bottleneck in one portion of the network, however, may serve only to exacerbate the problem by generating bottlenecks elsewhere.

Bottlenecks, it should be noted, are also a source of network power and control. Not surprisingly, network providers often seek to gain control over bottleneck facilities as part of their business strategies. Given network interdependencies, businesses can leverage control of the bottleneck to gain a competitive advantage in all component markets throughout the network. Such control can be achieved—as some claim Microsoft has done with its operating system—by owning a critical network standard (Farrell and Saloner 1987; Morris and Ferguson 1993). Or companies may try to gain control by buying up and vertically integrating the bottleneck into their business. To this end, many traditional carriers are today seeking alliances and/or buying up stakes that control set-top boxes, cable modems, and Internet portals.

Network Architecture

When network components are considered together and in relationship to one another, they have a definable structure. This structure and the rules that govern how components function within the network constitute the network's architecture. Although some communications networks are more pronounced and concrete than others, all have an architecture, which serves to structure and constrain the way in which communication takes place.

The transportation network, for example, is a complex hierarchical network of roads, rails, shipping routes, and airways. Although the network has many disparate parts, it appears seamless to the user. Despite its fixed nature, the network is somewhat flexible insofar as it can carry a wide range of cargo along a number of alternative distribution routes (Tennenhouse et al. 1995). Capacity and quality, however, are distributed unevenly. Each network consists of layers of distribution channels that are linked together into hubs arranged and spoked out in a decreasing order of size.

People-based networks also exhibit architecture, and with equally significant consequences (Scott 1998). Consider, for instance, social networks such as kinship groups or caste systems. As in any communication network, information is formulated, exchanged, and distributed by an integrated set of functionally related components—in this case individuals acting in roles—in accordance with certain rules and protocols. Over time, patterns of human communication generate a lasting structure that takes on an existence all its own.⁷ Embedded in a complex set of social relationships, human-based communication networks tend to be closed, inflexible systems, both reflecting as well as reinforcing the powers that be.⁸

Virtual networks—such as the Internet—are n...

Table of contents

• Cover Page
• Half Title page
• Series Page
• Title Page
• Copyright Page
• Contents
• Acknowledgments
• Introduction: Locating Cities on Global Circuits
• Part One The Urban Architecture of Global Networks
• Part Two Cross-Border Regions
• Part Three Network Nodes
• Notes on the Contributors
• Index