What is the Internet?

Dear Friends of the Yangtze River, Good morning! Very honored, and very happy to return to the platform of the Yangtze River. I left the Yangtze River from 06, today is probably the first formal return to the Yangtze River, thank you again for your invitation!

I began to study the Internet from 99, 2003 began to do Alibaba's strategic advisor, 2006 officially joined Ali. Every time I think there is some understanding of the Internet, I found quickly and confused, so the internet is really changing very fast. Even after 14 years, I still feel that the entire transformation of the Internet is just beginning, the road ahead is very long, but for everyone, the opportunity is still very big. So today I want to put some of these years of experience, with you to do a discussion.

What is the Internet? People listen too much and there are so many different nouns. I think we understand the Internet, only need three words is enough: the first is "mutual, joint, net". I find the word more and more beautiful, all the essence of the Internet is finished; the second word is cloud computing; the third word is big data. Everyone may be tired of hearing this, but in fact the internet is the essence of these three words.

(i) Mutual, joint, net

1, joint

What is the most important thing about the Internet? The beginning of the Internet is "union". English Internet is two words, one is called the Internet, one is called the Web. The internet is more like Cisco, Huawei and other companies they built the Internet infrastructure Communications, it refers to the real people, the world connected to the network facilities. The first purpose of Unicom was to build the Internet infrastructure. So you have to understand that the first key to the Internet is "link", which is the foundation of the whole world for us today.

1 The earliest people said that the Internet 1.0, refers to the PC wired Internet. The first PC connection can only be through the phone, and then through broadband, all need PC, line.

2 is now more popular is the Internet 2.0, that is, wireless internet. The most typical is WiFi, 3G, 4G Communications network, at the same time, the focus of communication from the PC to the smartphone. These two years of rapid development of smart phones, in the smartphone derivative of a number of services, most people are inseparable from the micro-letter, inseparable from the future "dealings."

3 What is the real Internet 3.0? I can't think of a better word right now. But there is a word that is also fried, called the internet of Things.

If you define the future of the Internet in one sentence, it is "anyone, anything, any time, any place, forever online, always interacting," which is the future of the Internet. Some studies have said that today we can not connect to the thing is less than 1%, if the connection between the things doubled 100 times times, what is this concept? So the future of the Internet is to all people, all things, at any time and place, can be connected together, and let everyone have information and action interaction, there is upload, there is downlink, this is the future of the Internet. The whole development of the Internet, the essence is to make the interaction become more efficient, more convenient, more natural. This interaction also includes man-machine interaction, such as the advent of the iphone is also a major breakthrough in human-computer interaction.

2, Mutual

1 If we use this architecture to talk about interaction, Interactive 1.0 is BBS. I think the first users still have the impression that the people in a very simple technical environment, with great enthusiasm to participate in such a network community construction.

2 Interactive 2.0 is similar to the Sina Weibo products, is an interactive community, its biggest feature is one-way attention. "Attention" is its main product form and interactive mode.

3 Interactive 3.0 is a Facebook, micro-letter products, their biggest feature is two-way interaction, anyone and any group, can occur in an instant multidimensional interaction. This is an in-depth "interaction".

3, net

On the basis of "connectivity", with such deep interaction, we can see the representation of content and services hosted on the Internet, the Web.

1 Web 1.0, is the most familiar portal concept, such as Sina, Sohu, NetEase. In the Web is the application of the Internet, in the 1.0 portal phase although there are interactive elements, but the most essential mode of communication is still more than one, or spread, so we call it new media. This time Hou Sina, NetEase emerged, everyone's understanding of the Internet is in the "New media, new dissemination." It is from the center point of the portal, to a much larger than the original audience of a concave point continuous transmission, it has a central point, basically a one-way interaction.

2 Web 2.0 is a search. In the 2.0 era, in the search interface or more on one, each individual and search engine contact, search background technology, fully utilize the Internet network structure. Google's search technology in the earliest intellectual property, called PageRank. How do you determine the relevance of all content on the Internet? PageRank is based on the connection of each website with any other site to determine its importance. The more connections you have, the more people pay attention to you and your relative importance is high. It relies on very complex algorithms, in the background of the network priority to do a sort, and then according to each user input (that is, each click), and then optimize. So the core of the search engine is two, the first is it to the index of the page to do the whole, to all the pages are collected to do a structured treatment. Google may have tens of billions of of pages, and it is updated at any time. The second is the algorithm, can calculate such complex data between the relevance, priority. So by the age of 2.0, its background is already a net structure.

3 Web 3.0 is SNS, two-way interactive social network, it is a many-to-many, while including point-to-point natural network. So Web 3.0 is an advanced form of Internet product evolution to today.

This is the first major point that I want to tell you, that is, from "Mutual, joint, net" three words to say the nature of the Internet, these three words are common evolution. Only with the continuous development of connected technology, the means of interaction is richer and more efficient, it will produce such advanced content and service on the web.

(ii) Cloud computing

2nd want to tell you the key word is cloud computing.

Cloud computing is a very image of the word, the more academic word is called utility Computing, we regard computing as a public utility to provide. Alibaba's 10 Anniversary (2009) We set up Alibaba cloud computing company, when someone joked that, is it because Ma Yun is called Cloud computing company? We said that maybe Ma yun is in line with this era. Cloud computing is indeed an expression of such a remote, large computational concept.

My own understanding of cloud computing is to understand the social status of cloud computing by studying the entire industrial history. The best contrast is the second industrial revolution. The second industrial revolution was essentially electricity brought about by the industrial revolution. Electricity is the 1893 Edison in Manhattan, the first time in a square kilometer to achieve the commercialization of electricity transmission and network. In a square kilometer, every block, every home, every store has electric lighting, which is a complex system. Everyone is familiar with the history of Edison's invention of the light bulb, as well as his light bulb company, power plant, including a full set of equipment, and the process of generating electricity. So 1893 was the first commercial application of electricity.

When electricity came up, if the factory needed electricity, it had to hire a dedicated executive whose responsibility was to build a power plant for the plant, to buy power equipment, to hire a dedicated power generation operator, to buy coal. There is no such public service for homes, J.P Morgan, a residential in New Jersey, is the world's first civilian residential power. His villa was burnt two times, because the electricity was so unstable that he used it to burn it. Of course because he is GE's main investor and Edison's most important supporter, he has tried his best.

The most important change was in 1905, when the United States began building the first large central power plant in Niagara Falls and then built a High-voltage transmission network between Niagara Falls and New York. If there is no high-voltage transmission, the remote transmission of electricity loss is very large, so began to have the concept of power grids. By 1925 the United States accounted for 40% per cent of the country's power grid. Probably to the Yichi year this ratio increases to 70% or 80%. It is because of the emergence of the national Grid that "electricity" has become a public infrastructure, so the rapid development of the United States during the Second Industrial Revolution soon.

I have two stories to tell about the choices of entrepreneurs in the new technological revolution. The first was Ford, and we talked about the most typical image of the second Industrial Revolution, the assembly line worker that Chaplin played in modern times. The most classic start of the industrial era is Ford's T-car line, which is generally regarded as the real arrival of the industrial age. Ford's T-car assembly line is the world's first power-driven assembly line. Ford himself was a General Electric electrical engineer, but he did not continue to work in GE, but further improve the power generation equipment, he put the idea of electricity in a general-purpose manufacturing field, creating a modern manufacturing starting point. Today we talk about the assembly line, mass production, the concept of the middle class is Ford's first creation. Mass production is a standardized operation, in order to reduce costs, he raised his workers ' wages to five dollars, and the workers were paid to buy more cars, to buy more cars, to lower the cost of cars, and to have more people buy cars after cheaper cars, which is a positive loop. So car prices have dropped 10 times times within 10 years.

The second example was also interesting when, after the advent of electricity, Edison turned GE into a power plant manufacturer, but Edison's assistant insisted that the future of the society was power grids rather than power plants, so he resigned from GE and went out and created the first grid company, Finally, the grid company became the largest in the United States. With the advent of a new technological revolution, the insights of entrepreneurs play an important role in the advent of the emerging options.

Let's go back to the subject. The most important change 100 years ago is that electricity has become a common public utility, thus driving the development of the whole social productive forces. After the electricity goes into households, the first household electrical appliance product is an electric iron, because it is the most helpful to the housewife, the technical difficulty is also the lowest. The second major product is the washing machine, which frees people from heavy labor. The third one is the radio, the radio comes out, the home appliance revolution really begins, is we today everywhere electrical appliances. All these are produced after the universal technology reaches certain social coverage. The core of the birth of household appliances is due to the establishment of a standard, that is, 110 volts standard interface. So all the appliances as long as the 110-volt standard socket, and the National Grid is connected.

So understanding this big change makes us understand that, since the 70 's, over 50% of the fixed assets invested by any company in the United States have been invested in it-related places. Now to create a company at least have to buy a computer, hire several IT staff, and have several software. It's like 1900 years or so, a factory has to start hiring people to build a power plant.

Now the biggest problem is that most of the enterprise IT investment in the actual utilization of less than 30%, whether it is CPU, storage, bandwidth, or a variety of personnel input. So on the one hand is increasingly heavy investment in fixed assets, on the other hand is increasingly low efficiency. Thanks to technology accumulation and gradual evolution, cloud computing was born. The first computer in 1946 was not as calculated as the greeting card we put on "Happy Birthday" today. After a large machine, minicomputer, and then to the PC, notebook, after more than 60 years step-by-step to today, people can finally use the public utility method to provide computing power. So in a word to sum up the cloud computing, is at any time, any place, as long as the internet, there is computing power to provide. How much you want to use, how much to remember, this is cloud computing.

You can think about what happens to the world when you start a company and no longer need to hire IT staff to ask them "what software are we going to buy" when all you need is to use the services you want? Because technology barriers are so much lower, "innovation" erupts in an unprecedented way.

In retrospect, the biggest barrier to internet start-ups over the past decade is the investment in fixed assets. A start-up entrepreneur, with a very good idea, then to finance, to dilute the 30%-40% stake, but also to buy the server in advance. For a career you may or may not be able to achieve in the future, you use the most expensive equity in exchange for the least valuable it fixed asset investment. And the law is gradually being broken.

Let me cite two more examples, the first example is the animation industry. We all think that the animation industry is the creative industry, and then more contact I understand that the creative in the animation industry accounted for about 1/3, animation industry is a huge investment in the industry. Why is it that only companies like Pixar can make such big movies? Very simple, in the entire animation into the film process, the largest input called rendering, is the original painting, into 3D image. A decent animation company, at least need more than 1000 servers, in order to do rendering work. The bigger the enterprise has this advantage, the small entrepreneurial team has no way to turn the idea into a relatively high quality product.

2009 we began to do cloud computing, after more than three years of efforts, we provide a more mature animation industry technical solutions. A Hollywood-like anime blockbuster this year is called "Kunta." If they use their own investment to buy the server for rendering, it will take about two years to complete the rendering. But we use Taobao technology, about two months time to all the rendering has been completed, the cost is less than 10%. Taobao computer group calculation is very large, every day nearly 100 million of people visit Taobao, there are millions of of sellers, hundreds of millions of of goods, peak time to occupy resources very large, but in the middle of the night we can put this computing resources released, to the animation company to do rendering. So all of a sudden the animation industry to shorten the innovation cycle.

The second example is a double 11, and we all know that last year created an astonishing number: 19 billion. Last year double was our first time to provide cloud computing services to Taobao sellers. One of the most classic examples is that there is a seller, in the dual 11 of the morning system crashes, we spent less than one hours, in the cloud computing platform to help him restart the full set of services, the seller basically nothing to lose. This is the biggest benefit of cloud computing, can be instantaneous expansion, you want how much space, there is much space. Last year, there is a Taobao sellers usually a single quantity, may also be more than 10,000 single, double 11 that day rushed to 500,000 single. What is the size of 500,000? It's a day's order for some electric dealer. Taobao, a seller in the absence of any IT investment in the case, on the platform Taobao Cloud computing completed. You can think about how much his cost advantage is. Because of this advantage, this year's double 11, more than 80% of the day cat orders, will be tied to the cloud computing platform. Last year we took a lot of risk to do a combat exercise, 10% of the business with the cloud computing services, very successful through a huge peak. This year we have a fundamental understanding of cloud computing's confidence and its commercial value.

So to sum up, cloud computing is different from traditional it proprietary thinking.

1 First, the traditional it enterprise, in the investment of it belongs to the fixed assets. Cloud computing as a public service, is an operating cost, a controllable operating costs, the cost of the entire asset structure, financial situation optimization, the resulting value is immeasurable.

2 Secondly, most of it equipment as a self-employed time, is to ensure the maximum value when the use, there must be a huge waste, the majority of enterprises, the average utilization rate of less than 30%. In the use of cloud computing, it is in accordance with the way the electricity bill each month, the actual amount of calculation, according to the bill to pay, so basically no waste.

3 Finally, the traditional it way, the expansion of the cycle is long, high threshold, investment, the technical threshold higher. Most companies do a certain degree and invest it in other areas. But using cloud computing can enjoy the most advanced technologies, such as security. On the one hand, you will certainly be concerned about the security of any public service platform, on the other hand, because security is so important, a public platform for security investment, must be far more than any enterprise. Last year, a resource-type Web site, published a less favorable comment on an IT company, resulting in a malicious attack on the site, two hours was the attack across the line. Later this resource-oriented web site moved to Ali Cloud computing platform is safe, because to penetrate Ali security system, the difficulty is very large, but a small business is unlikely to have such security protection. So in this way, it is not afraid of the top hackers or such malicious attacks. This is the difference between a platform and an enterprise.

Instant expansion, do not have to pay the extra price for the vacant, this is a very large business value of cloud computing, and finally summed up the discussion of cloud computing, or just that sentence, in the future at any time, any place, will be able to access the Internet in real-time services, and then pay for the actual use of

When cloud computing becomes the basic social infrastructure, I feel that human beings are truly entering the new era. If electricity had not turned into a public utility, and Ford had created the first assembly line on the basis of electricity, there would have been no industrial age. Similarly, a new era is only real when more and more companies are putting their operations on the public cloud computing platform.

(iii) Large data

The third I want to talk to you about big data, this is probably the most fashionable word in the past year. The real essence of big data is not "big", but a whole new set of thinking that is connected to the Internet. What is the biggest difference between big and traditional data?

1) online. First, the big data must be always online, and the online is also hot backup, not cold backup, not on tape, is ready to call. The data that is not online is not big data, because you have no time to export it to use. Only online data can be computed and used immediately.

2) Real time. Large data must be reacted in real time. We enter a product Taobao, backstage must be in 1 billion items, instantaneous rendering. If I have to wait one hours to present the speech, I believe no one will be on Taobao. 1 billion of goods, millions of sellers, 100 million of consumers, the instant completion of matching rendering, this is called large data.

3) the whole picture. Large data also has one of the biggest characteristics, it is no longer a sample thinking, it is a whole thinking. When it comes to data, the first reaction is to sample, sample, but the big data is no longer sampled, no more calls, we want all the possible data, it's a whole picture. Actually, the whole data is more accurate than the big data.

This is the three essence of large data, online, real-time, full picture.

In order to have more understanding of the big data, I will discuss it with you. We do business, the most easily thought of two data applications, one is market research, send a marketing company or marketing department to do a survey, to see what the company feedback. The second is business intelligence bi, data mining, viewing data management reports. This is the most traditional two data applications. There are several typical features of such data applications:

1. Be aware of the goals to be achieved and actively collect the data. Because the computing power of each enterprise is different from the cost, how much time and what data can be used by the data will vary. And the large data is real-time record data. In principle, any person on any website, do anything, everything will be recorded, no personnel to do first distinction. So everyone stops asking, the data is recorded, so this is the first difference.

2 The second difference: the person involved is no longer conscious participation, but unconscious participation, and you are doing things for your own benefit. You use a search, you are involved in Google's big data collection, because each click is a data source. If you take part in a market research, 80% of the cases you will refuse, 15% of the circumstances you may ask for a sense of compensation. Few people are willing to take the initiative in market research because it is a burden to you. But the big data on the line is an unconscious, self profit behavior for most people. I taobao is to buy things, I on Weibo is to see the news, I on Baidu is to search, you are for their own interests triggered by an unconscious behavior, but this unconscious behavior, have contributed to large data.

3 The third difference, one is one-way, one is two-way. The data analysis we used to do was to assume a purpose, and then get the ready-made data, analyze the behavior, to test my guess. These are a one-way led. Large data in nature must be two-way, like search, when you click on the search engine click, you are to give it input data, it gives you the result is that it interacts with you, is that it brings you the value of the data. The big data itself is at any time creating value for you, so it becomes a two-way interactive positive loop in which both parties contribute data value. Any large data application, if not in the design of this two-way, mutually beneficial positive cycle, is not run, in essence, is not large data.

The last point to emphasize is the rate of reaction, the greater the value of data, the higher the rate of reaction. For example, Google's search, you enter a keyword to see the results, and one hours later enter the same keyword results, it is likely to be different. Because it has recalculated all the clicks in the world within one hours, then the information is optimized and then fed back to you. So you can think about it, the faster the feedback, the greater the value it creates, the greater the incentive for consumers to participate. The bigger the data, the faster the reaction, the better the result, the more users will become a black hole effect. This is the core concept of the Big data I want to talk about.

The nature of the Internet, finished these three words have basically finished. What I'm offering you are some of the most basic thinking tools. How do you solve the problem with this way of thinking? The most important thing is to have the Internet thinking, you first have the Internet thinking, you can go to use the Internet technology.

After you've finished with some of the most basic concepts, let's introduce some basic inferences. Based on the nature of the Internet, what conclusions can we draw?

What is the spirit of the Internet? What is called using Internet thinking to do things? I just said that the three, has already told the standard of judgment, take this standard to a set, basically know is not large data application. So what is the spirit of the Internet?

1) equality. Why equality? This is determined by technology, just as productivity determines production relations. A network structure of the Internet, is not a central node, it is not a hierarchical structure. Although different points have different weights, but not one point is absolute authority. So the technical structure of the Internet determines its intrinsic spirit, is to be decentralized, is distributed, is equal, is interactive. Equality is a very important basic principle of the Internet.

2) Open. Why open? The more open you are, the more you connect with others. In a networked society, the value of a "personal" and an "enterprise" is determined by the breadth and thickness of the connection point. The wider your connection, the thicker your connection, the greater your value, which is also the basic feature of the Pure information Society, which determines your value by your content. So openness becomes a necessity for survival, you are not open, you have no way to get more connections.

3) interaction. Whether from the Internet or from the perspective of large data, must be two-way, interactive to create value. In fact, "intercourse" is the interaction itself, two-way.

4 The last most practical, is the iteration. What do you mean by iteration? An idea, a product or a prototype, throw out, use it, others give you feedback, you modify the bad, this is a real-time interactive process, but no longer a theory. Whether it is research and development products or provide services, all aspects are no longer the same as the original through a seemingly rigorous theory to implement, more through practice, through optimization to approach. So more is computation, no longer mathematical theory. This is a big difference.

Taking statistics as an example, the statistical theory is in the case of insufficient computational capacity, with an arithmetic method to find the most wanted, can pour out the overall state. All the forces of statistics are concentrated in theory and mathematical theory, and all the power of large data is focused on the optimization of algorithms. I do not presume theory at all, I just come back through the round of iterations to get closer to reality. What is the user's requirement? First hit out, and then check, as long as there is two-way feedback, I always closer to the truth. So the iteration is the most critical cornerstone of the Internet's entire product. Related to this is also A/b test, which is the particularity of the Internet and its technical framework to determine, for example, to test any one of the products, I can clean out Taobao flow of 1% out, first to give it to try this thing, try to finish this level I will enlarge it to 20%, 80%. The combination of iteration and A/b test has made internet companies far more efficient than traditional companies can imagine.

5 The 5th is evolution, not planning. We should have a certain perception, I just said the iteration or a B test, it is not in essence through a perfect plan to achieve, but through an evolutionary way to gradually optimize, close to better state, this is the spirit of the Internet.

I sum up the spirit of the Internet is that equality, openness, interaction, iteration, evolution, on these 5. Since is called the spirit must penetrate the marrow, carries on to your product, the service, the team, the organization, the operation to go.

In conclusion, what does the Internet bring us? From a maximum point of view, the Internet let us from the industrial civilization to the information civilization, from the industrial economy to the knowledge-based economy. These words shout for twenty or thirty years, it is because of constant shouting, today we may cross this threshold. I put the universal use of cloud computing as a sign that society is entering the information age. Of course, cloud computing as a utility, to achieve 30% or 40% coverage, it may take 10 years or so. But we should have been like 100 years ago, that is, the 1910-1920 decade of rapid development of the state. And it's because of cloud computing that big data becomes possible. Without the ability to store and compute huge amounts of data to make it very inexpensive, it is impossible to do large data, and the cost of the data will crush you.

We are moving from an era of mechanical system to an ecosystem, from industrial civilization to information civilization, from industrial economy to knowledge economy. From this point of view, if the most important asset of the agricultural civilization era is land and farmers, the industrial age is capital, machinery (machine is solidified capital), the assembly line was alienated people. The most considered in the early days of the industrial age were alienated people, who were also treated as machines. Ford also famously said that "I do not need your head, I only need your hands," so people are just the screws in the assembly line. Capital and alienated people are the most important factors of production in the industrial Age. In the era of knowledge economy, the core resources are two new things, one is data, one is knowledge worker (knowledge worker), is the knowledge worker that Drucker spoke at the end of last century. We can see that capital is not so important in the future. Of course, the change of our whole society and the change of production relation always lag behind the change of productivity, so the whole evaluation of the capital market takes the shareholder's benefit as the basic guiding ideology. Enterprise management will also from the traditional multi-level to a more flat, more network, more ecological way. Let knowledge worker truly create value and become the most important and necessary breakthrough place for any organization and society as a whole.

I would like to mention, if you want to read, there is a book or the most classic, is Drucker wrote the "21st century Challenge." This is the most classic book, for the future changes in the overall trend, in the most understandable way, elaborated on the knowledge economy for each of us. The big data is only the knowledge economy landed the most real entrance, when the cloud computing has the big data, has the Internet such foundation, these three are the Trinity. Without cloud computing, there is no big data, cloud computing is for large data services, and the entire Internet output is computing power. People have mentioned super computer supercomputer, and the Internet is the largest computer, it output is all the needs of the whole society computing power.

When this Trinity begins to move towards a positive cycle, the knowledge-based economy really begins. In this sense, we are faced with changes across the ages, and everything is just beginning, there are too many possibilities in the future. If not 100 times times the space, at least dozens of times times the space can be seen. Any major technological revolution, in the early days, when everyone would overestimate its impact, there would be a round of bubbles, but in the medium term people tend to underestimate its impact and feel that these are just concepts. When you think it's a concept, it begins to sprout and thrive.