The World Wide Web was invented in 1992 by Sir Tim Berners-Lee as a simple mechanism to share scientific papers with colleagues. The key innovation of the web was the use of hypertext — the mechanism by which we click on a link, such as a chunk of highlighted text, and are able to download the target document automatically. Although this is a simple idea, the web has changed the world we live in. Its rise is also a superb example of what happens when the private sector is left alone to meet market needs.
Despite its great complexity and rapid development over the last 10 years, the web community works largely without state intervention of any sort. Web designers did not need the hand of government to develop the skills to create ever more complex websites; IT professionals did not wait to read official reports saying they had to adapt as the technology changed; and companies were quick to offer the ever-evolving range of services needed for the web to run smoothly.
In other words, the private sector adapted, and adapted very quickly. Free-market mechanisms did what they always do — they rushed to meet consumer needs. This is reflected not only in the wide range of products available but also in the rapid drop in prices of almost every aspect of the web. Ten years ago, a personal website was an expensive proposition, especially if you needed anything professional or polished. Today, in the form of blogging software or services like Facebook, it is free. The overall cost of entry — taking into account the cost of training needed only a decade ago and now no longer necessary — has not so much dropped as evaporated. This low cost of entry has allowed a wide variety of individuals and companies to trade online, providing considerable choice for consumers.
Although the growth we have seen online is exceptional, it is still only a faster version of something capitalism does well: meeting a myriad of needs in a diverse society. It is difficult to imagine a better example of the free market at work.