I’m bummed that I missed LeWeb, but I’m glad I got to see and hear Fred Wilson’s talk there, given on Tuesday. I can’t recommend it more highly. Go listen. It might be the most leveraged prophesy you’re ever going to hear.
I’m biased in that judgement, because the trends Fred visits are ones I’ve devoted my life to urging forward. You can read about them in Linux Journal (starting in 1996), The Cluetrain Manifesto (1999, 2000, 2011), this blog (starting in 1999), ProjectVRM (starting in 2006) and The Intention Economy (2012). (Bonus links: What I said at Le Web in 2007 on stage and in an interview.)
He unpacks three megatrends, with an additional focus on four sectors. Here are my notes from the talk. Some of it is quotage, but little of it is verbatim. If you want to quote Fred, go to the source and listen.
1) We are making a transition from bureaucratic hierarchies to technology-driven networks. The former is the way the world has been organized for the last two hundred years. Markets, government, businesses are all pyramids. Transaction and communication costs were so high in the industrial era that these pyramids were the best way to organize work and run systems. But now technology-driven networks are replacing bureaucracies. Examples…
Twitter. Replaces the newspaper. The old army of reporters that reported to divisional editors who chose what would appear in limited spaces and distribute through printing mills and trucked to your doorstep was slow moving and bureaucratic. Now all of us are reporters. The crowd determines what’s important. This is an example of a tech-driven network.
YouTube. TV was hierarchical. Now all of us are video creators.
SoundCloud. Anybody can create audio or music. No labels. No radio or music industry required.
We first saw this trend in media and entertainment. Now we’re seeing it in AirBnB, One Fine Stay. Creative industries like Kickstarter and VHX. Learning with Codecademy and DuoLingo for languages.
We are very early with all of these and more to come.
2) Unbundling. This has to do with the way services are packaged and taken to market. In the traditional world, you only got to buy the thing that had everything in it. Now tech is changing that. More focused, best of breed, delivered a la carte. Now on mobile and internet you get better everything. Best of sports, fashion, classified advertising.
Banking is being unbundled. Banks used to do everything. Now entrepreneurs are picking off services. Lending Club. Funding Circle. auxsmoney in Germany. Taking profitable lending franchises away. Working capital. c2fo. Management services. All new, all based on networks.
Education. It’s expensive to put a lot of students in a building with a professor up front of every class. You needed a library. Administration. Very inefficient, costly, pyramidal and centralized. Now you can get books instantly. Research is no longer as highly centralized and capital dependent. See Science Exchange: collaboration on an open public network. All this too is also early.
Entertainment. Used to be that you’d get it all on cable. Now we get Netflix and YouTube on our phones. Hulu. A la carte. Airplay, Chromecast.
3) We are all now personally a node on the network. We are all now nodes on the network, connected all the time. Mobiles are key. If forced to make a choice between phone and desktop, we go with the phone. (About 80% of the LeWeb audience did, along with Fred.) In the larger world, Android is being adopted massively on cheap phones. Uber, Halo.
This change is profoundly impacting the world of transportation. Rental cars. Delivery. Payments. Venmo, Dwolla, Square. Peer to peer. You can send money to anybody. For dating there’s Tinder. Again, this is new. It’s early.
The four sectors…
a) Money. Not just Bitcoin. At its core Bitcoin is a protocol: the financial and transactoinal protocol for the Net. We haven’t had one until now. As of today it is becoming a layer of internet infrastructure, through a ledger called the blockchain that is global. All transactions are cleared publicly in the blockchain. Entrepreneurs will build tech and services on this. Payments and money will flow the way content now flows. No company will control it. Others’ lock on our money will be gone.
b) Health and wellness. Health care is regulated and expensive. Health and wellness is the opposite. It’s what keeps you out of the hospitals. (QS is here.) The biologies of our bodies will be visible to us and connected. Some communications will be personal and private, some networked, some with your doctor and so on. Small example: many people today gamify their weight loss.
c) Data leakage. When the industrial revolution came along, we had polluting. It took a century to even start dealing with it. In the information revolution, the pollution is data. It’s what allows Google, Facebook and the government spy on us when we don’t want them to. We have no control over that. Yet.
d) Trust and identity. We have allowed Google, Facebook, Amazon and Twitter to be our identity services. It’s very convenient, but we are giving them access to all we do. This isn’t good. Prediction: a bitcoin-like service, a protocol, that is distributed and global, not controlled by anybody, architected like the Internet, that will emerge, that will give us control over identity, trust and data. When that emerges I’ll let you know. I haven’t seen it yet.
Talk to me, Fred. 🙂
The Powers that Be have been telling us to invest our savings in mutual funds and index funds — trusting either a set of mutual fund managers and corporate boards, or mutual fund managers and corporate boards in general.
Now we’re going to be able to have a choice…
“Crowdfunding for Internet Stock Sales Approved by SEC”
Watch for a flurry of scam stories on the mainstream media — but I hope they don’t take our microtycoon powers away before the equity crowdfunding action gets good.
As much as I hate making this prediction, I think that ultimately computer (in)security is going to kill off innovation on the internet. Bitcoin can only stand as long as we have computers (and wallets) that can withstand assault via the net. That’s not possible as we have persistently insecure end nodes.
We’ll all end up using mobile devices (terminals), connected to insecure virtual machines that get re-spun once they get infected.. and it will always be a race to detect the infection.
With the death of the desktop and laptop, there’s not going to be anyone left to build a truly secure operating system. The future has been lost, and the NSA / Silo builders are going to own it.
Excellent idea doing this summary, Fred’s talk is a must watch indeed.
Looked like we had a similar idea with the video summary! 😉
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