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CLICK HERE TO SIGN UP or visit us online to sign up at eBookNews.SimonandSchuster.com CONTENTS EPIGRAPH FOREWORD by Walter Isaacson THE THREE WAVES OF THE INTERNET PREFACE ONE A Winding Path TWO Getting America Online THREE The Third Wave FOUR Start Up, Speed Up FIVE The Three P’s SIX Pardon the Disruption SEVEN The Rise of the Rest EIGHT Impact Investing NINE A Matter of Trust TEN The Visible Hand ELEVEN America Disrupted TWELVE Ride the Wave PHOTOGRAPHS ACKNOWLEDGMENTS ABOUT STEVE CASE NOTES INDEX To the entrepreneurs who inspire me by striving to change the world Climb high, Climb far, Your goal the sky, Your aim the star. —MARK HOPKINS FOREWORD BY WALTER ISAACSON I HAPPENED TO be a bystander at one of the most important moments in the turn-of-the-century transition to digital media, and the setting could not have been more incongruous. We were at the Great Hall of the People in Beijing for the celebration of the fiftieth anniversary of the Communist revolution in China when this milestone of capitalism occurred. As part of a 1999 “news tour” organized by Time magazine, of which I was editor, we brought the Time Warner board and other American business leaders to China. The capstone was attending a twelve-course banquet for a thousand people at the Great Hall, hosted by the country’s top Communist leaders. My main memory was watching Ted Turner, then vice chairman of Time Warner, glide among the gilded red velvet chairs as he introduced people to “my commie pinko wife,” Jane Fonda. But out of the corner of my eye, I kept noticing Steve Case, with his placid face but intense eyes, in earnest conversation with Time Warner CEO Jerry Levin and board members such as Merv Adelson. There was a lot of huddling going on, and it intensified just after the dinner. An epic rainstorm erupted, trapping us on the portico and steps of the Great Hall as we waited for our cars. Turner and Case engaged in the bantering they both did so well. Your big conglomerate, Case taunted, can’t seem to get us home. “Your billions aren’t getting you anywhere, either,” Turner replied. But this was more than banter. Their comments hinted at a deeper truth. That night, with Chairman Mao beaming down from hundreds of huge posters, Case and the Time Warner leaders began discussing how the sprawling old media company, which made movies and magazines and cable television, and the hot online service, which had made “You’ve got mail” a national pastime but was now threatened by the web and the emergence of broadband, might want to join forces. Jerry was affecting the air of a wise pasha, listening and nodding. Steve was feigning a casual and laconic aura, as if the possibility of a merger was a topic of only mild curiosity to him. It was clear to me—or perhaps became clear to me in retrospect—that something serious was going down. The following January, less than four months after that evening when the idea was first broached, the merger of AOL and Time Warner was announced. I had first met Steve in 1992, when AOL and Time magazine became partners in offering online content. His company had just gone public with a $70 million valuation. By the merger eight years later, AOL was valued at $160 billion. Steve had many great insights back when AOL was a startup, all of them explained in this book. From the day it launched its first service in 1985, when just 3 percent of Americans were online, Steve believed the digital realm was not going to just be about content and commerce. First and foremost, he insisted, it was going to be about fostering community—about connecting people and allowing them to communicate. When I was working on a profile of Steve for my book The Innovators: How a Group of Hackers, Geniuses, and Geeks Created the Digital Revolution, Steve told me: “Our big bet, even back in 1985, was what we called community. We thought the killer app of the Internet was going to be people.” Steve was right. AOL tapped into the desire to communicate, connect, collaborate, and form community. The advent of social networks, from Facebook to Twitter to Snapchat to Reddit, has built on that trend. But in many ways, those new services are just a return to the central insight that Steve had when building AOL. A related insight that Steve had, and which helped create the digital revolution, was the importance of being inclusive. Before AOL came along, the Internet had been a workspace and playground for hard-core geeks, not for ordinary folks who would thrill at a voice saying, “You’ve got mail.” Case and AOL helped lead that change, truly getting America online. The previous year, then-senator Al Gore—in an act that should have inoculated him from the unfair jokes about having “invented” (a word he never used) the Internet—had sponsored and helped pass a bill that opened up the Internet to commercial and public use. Until then, it had been a network restricted primarily to researchers and government contractors. His bill said that the Internet should be accessible even to those who got online through AOL or other consumer services. “It now seems really silly, but up until 1992, it was illegal to connect a commercial service like AOL to the Internet,” Case recalls. This transformation began when AOL opened a portal in September 1993 to allow its members access to the newsgroups and bulletin boards of the Internet. The deluge was called, especially by contemptuous veteran netizens, “the eternal September.” The name referred to the fact that every September a new wave of freshmen would enter college and, from their campus networks, get access to the Internet. Their postings tended to be annoying at first, but within weeks most had acquired enough netiquette to assimilate into the Internet culture. The floodgates that AOL opened in 1993, however, produced a never-ending flow of newbies, overwhelming the social norms and clubbiness of the Net. Many Internet old-timers complained. But, in fact, the democratization of the Internet by AOL and similar service providers was an amazing and wondrous moment. It opened the way for our inclusive and explosive digital revolution. In this book, Steve Case has recounted these and other lessons from his career and interwoven them with a forward-looking guide on how to succeed in the next wave of innovation. Having helped create the First Wave of the Internet, and then been an active investor in the Second Wave, Steve is uniquely able provide a framework for envisioning how the Internet will be fully integrated into every aspect of our lives. The Third Wave is a delightful read, and by writing it Steve has performed a valuable service. As someone who has spent more than two decades watching Steve, learning from him, and marveling at his insights, I am thrilled that this book will allow countless future innovators to do the same. Walter Isaacson, the CEO of the Aspen Institute, is the author of The Innovators: How a Group of Hackers, Geniuses, and Geeks Created the Digital Revolution and of biographies of Steve Jobs, Albert Einstein, Benjamin Franklin, and Henry Kissinger. THE THREE WAVES OF THE INTERNET