A similar
situation exists today with the sating of appetites for illegal drugs. Perhaps
because many such drugs impact on the basis of human emotional response, that
is on the physiological foundation of trust, the struggle, much like the
prohibition era in the United States, has religious overtones. A significant
aspect of the parallel social ecosystem in this case is controlled by drug
cartels that serve as brokers between producers of drugs or drug precursors in
foreign countries (and to some degree within the United States) and drug users within the United States. As with alcohol, the economics of this
middleman operation are interesting. The actual drug producers, the farmers
that grow opium poppies for example, earn a modest living but most don’t appear
to get rich, while the end users (addicts) are in a position of pricing
inelasticity. For them, cost is not of overwhelming importance when one has to
have a fix. As a consequence, the middlemen who convey drugs from the producers
to the users occupy the position of very high profit margin businesses; buying
a product according to its cost of production and selling it according to its
value to a captive population with a physiological need for the product. This
is, of course, the holy grail of virtually any business; a situation where
product pricing is based on value to a consumer with an overwhelming need and
the cost of production is determined by a commodity production environment. In
the case of illegal drug trafficking, of course, large sums of money and
manpower are devoted by law enforcement to interdict the supply chain,
rendering the business subject to high risks as well as high rewards. The
“credit bubble” of 2007 and 2008 confirmed that normal banking operations are
also subject to the proper assessment of risk versus rewards. The bursting of
the bubble is an illustration of the consequences of incorrect assessments.
Coming back to
the concept of portals on the Internet, a number of specific Web sites have evolved
as ubiquitous brokers positioned between producers and consumers of content. We
can identify three central genres of such portals: search engines, product
portals and service portals. At the time of this writing, the most significant
of the search engine portals is Google, the proverbial 800 pound gorilla in
this space. Most of their revenue is generated from general and targeted
advertising. Hence, the act of providing logical connectivity between producers
and consumers of general content has become a content commodity in it own
right. This connection content is dependent on a satisfactory experience on the
part of the consumer seeking content. In other words, this Web site is able to
extract a premium for the trust that consumers derive from its services.
While there are
many successful product portals, perhaps the most iconic of the lot is the
Amazon.com Web site. With its beginnings grounded as a bookseller, Amazon.com
has subsequently expanded into a full range of product offerings. This Web site
has very successfully implemented a multi-protocol stack model in its provision
of content to the consumer. In particular, Amazon.com was perhaps the first
large volume Web site to perfect a two stack interaction mechanism. One stack
is purely information and financial transaction oriented. It enables the
consumer, through a standard Web browser, to search for a desired book to
purchase through a database on the Amazon.com Web site. Once a selection is
made, the consumer can pay for the book through a variety of financial services
mechanisms, the most common of which is a standard credit card. At the time of
order placement, the consumer indicates the address to which the book is to be
delivered. Completion of the order placement then triggers the book delivery
process that makes use of a different protocol stack.
The deliver
stack entails lower level protocols through which the book can be reliably
delivered to the consumer’s indicated shipping address. The physical layer
channel for this protocol stack is a courier service such as UPS. Amazon.com
has designed the physical layout of their enterprise such that their book
warehouse is adjacent to the hub for the courier service. This means that a
book package is delivered to the distribution hub at an airport by surface
truck and it is then
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