Daily Archives: April 11, 2013

The rise and fall of the web

This is my part of a joint newsletter with Rohit Talwar, his was published just now as a guest blog.

The rise and fall of the web

20 years ago, the web was in its infancy and the first conferences appeared where we could all discuss what was coming next. Even then the need was obvious for search engines, portal sites, firewalls, social networking, online shopping, auctions, discount buying schemes and so on and even the seedier side of the web was already obvious back then. Not much around today on the web wasn’t being discussed 20 years ago. It just took that long to emerge and evolve into what was anticipated. What has happened is exposure of the naïve optimism of some of the early debate.

Over the coming years we saw the expected creation of companies like Amazon and ebay, Facebook, Twitter and Google, and the rise of already existing companies such as Microsoft, Apple and Samsung, in some cases from niche player to market dominance. Without exception, the companies I mentioned deserve praise for struggling through the difficult phases of market creation and the sometimes huge and prolonged losses leading up to break-even and eventual profitability. They all started with a dream and made it happen, knowing they would succeed if they worked hard enough at it.

Without wanting to remove any of that praise, it is hard not to wonder if at least part of the dream is starting to turn sour. Is there evidence now that power corrupts? Does possession of a strong market position always lead inevitably to market abuse?

In each case, there are recent examples of less-than-saintly behaviour, but some issues are spreading as a problem, so rather than pick on individual companies, I’ll focus on the issues. In each case, a large company with little effective competition is in strong position to force these policies since they know customers and clients can’t easily just walk away. There is no cartel, but if a problem happens to affect all the main providers for a service, or it is a de-facto monopoly, you really have no choice.

Privacy invasion or at least scant regard for privacy is the biggest issue for some, introducing policies that make it hard for users to remain private. In this case, the reason is obvious. Privacy conflicts with extracting maximum market value from a customer’s personal data. I don’t personally want everyone to know what I just bought online, what I watch on TV, what games I play or what music I am listening to, or to have full access to everything I ever typed on a social networking page. The choice we seem to be presented with is simple. If you don’t want to be fully exposed 24-7, either don’t use the web or a mobile app, or be prepared to spend time frequently to check every site you use carefully for their latest policy changes to make sure an oversight doesn’t allow your privacy doesn’t fall through a new hole they just dug. But even that may not be the real choice now. The emerging pattern seem to be that changes may be introduced retrospectively, eradicating any value in privacy commitments in existing policy. If that behaviour spreads, then any privacy you think you have today is merely an illusion.

Burning the candle at both ends is another recent issue. Although the web has few of the costs associated the with high street, large web companies are charging high fees now to companies to sell via their site, much the same as property developers with the best locations can charge high fees to shops. That end of the candle is well alight, but customers are finding the discounts offered are often far less now too. Now that they have been psychologically hooked by the web empires, prices are rising.

Walled gardens were a consideration for regulators when mobile and broadband networks were emerging – I took part in several workshops discussing their merits and drawbacks. Telecoms regulators understood well that dominant telecoms companies might try to force customers to use only services within their own areas of control, i.e. to stay in their walled garden, and they legislated accordingly to protect customers. It was presumed that competition would suffer greatly if people were not free to wander as they pleased and exploitation would follow soon after.  However, although some of the web giants are heading rapidly and determinedly down exactly that path, the authorities are either looking the other direction or unable to do anything about it. It seems that any regulators that do exist have too vague boundaries on their remits, or the companies fall outside their jurisdiction geographically, or they simply have too many issues to deal with and can’t keep up. It is unacceptable that we now by default have arrived at a business platform that lends itself to abuse but isn’t being properly controlled by the normal regulator processes that apply as standard elsewhere.

Arrogance is a term we hear thrown at web giants frequently now, and it does seem appropriate when a large company ignores protests by its customers and imposes policies that significantly affect the terms and conditions that applied when they first became a customer. Even incrementally small changes can add up to large change in a short time, but if customers have invested time and effort building a profile or establishing a place or network on a site, the personal costs of migration can be too high. There ought to be equivalent rights protecting the interests of customers online just as in the physical world, but online providers appear to be able to make their own conditions of use with much greater scope for abuses, knowing that very few customers will read many pages of small print. Especially where websites feature heavily in everyday use, and where not being a user might even may be a career or social impediment, there should be more protection from arrogance and unilateral determination and management of user rights. Some regulatory body should be making sure terms and conditions are fair and balanced because the market isn’t doing that by itself.

Another aspect of arrogance is the enthusiasm to avoid taxes by exploiting holes in the law, and reading between the lines, it is as if the companies think they know best how money should be spent for humankind’s best interests, not governments. They may be right about government, but that doesn’t excuse arrogance.

Reintermediation is a direct consequence of walled gardens but is an issue in its own right. Early analysis of the web suggested it would lead to perfect markets, where people would be in direct contact with suppliers, thereby cutting out the middle man and his costs while forcing perfect information and hence maximum competitiveness. With good search, it would be easy to find all potential suppliers for something and compare them directly, and there would be no need to go via an agency. What we have now is interesting in that the search sites have themselves become intermediaries, and comparison sites another layer of that, listing results from a subset of suppliers. So instead of removing an intermediary we generated two new ones, three if you use an app store to do it. Everyone wants a slice of the pie of course, but the web was meant to bypass that, and it simply hasn’t. People can go direct, but it doesn’t take long to discover that using a search engine will often put hundreds of pages of the wrong sites before the one you search for. Most of the listings on the first several pages will often be intermediary sites.

In spite of all this, the potential of the web hasn’t gone away. It still allows word of new sites to spread rapidly, for reputations to be made and lost, for empires to spring up overnight, and for old ones to crash and burn. Boredom is under-rated as a motivation to change too. Social network sites in particular are highly vulnerable to their customers simply getting bored and leaving, but new designs and novel ideas can present a real threat to any of them. The sword of Damocles hangs over all.

For all their size and momentum, none of the web giants is guaranteed longevity. As some of yesterday’s giants discovered, a startup can replace them in just a few years. Maybe the first generation of web giants has climbed high, but decadence and abuse of power have made them ripe for conquest. All we need now is to wait for the imminent emergence of the second generation.

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Technology Convergence – What’s your Plan? Guest post by Rohit Talwar

Rohit is CEO of Fastfuture and a long-standing friend as well as an excellent futurist. He and I used to do a joint newsletter, and we have started again. Rohit sends it out to his mailing list as a proper newletter and because I don’t use mailing lists, I guest post it here. I’ll post my bit immediately after this one. I’m especially impressed since his bit ticks almost as many filing category boxes as it uses words.

Here is Rohit’s piece:

Technology Convergence – What’s your Plan?

I have just returned from South Korea where I was delivering a keynote speech to a cross-industry forum on how to prepare for and benefit from the opportunities arising from industry convergence. South Korea has made a major strategic commitment starting with government and running through the economy to be a leader in exploiting the potential opportunities arising from the convergence of industries made possible by advances in a range of disciplines. These include information and communications technology, biological and genetic sciences, energy and environmental sciences, cognitive science, materials science and nanotechnology.  From environmental monitoring, smart cars, and intelligent grids through to adaptive bioengineered materials and clothing-embedded wearable sensor device that monitor our health on a continuous basis – the potential is vast.

What struck me about the situation in Korea was how the opportunity is being viewed as a central component of the long-term future of Korea’s economy and how this is manifested in practice. Alongside a national plan, a government sponsored association has been established to drive and facilitate cross-industry collaboration to achieve convergence. In addition to various government-led support initiatives, a range of conferences are being created to help every major sector of the economy understand, explore, act on and realise the potential arising out of convergence.

I am fortunate to get the opportunity to visit 20-25 countries a year across all six continents and get to study and see a lot of what is happening to create tomorrow’s economy. Whilst my perspective is by no means complete, I am not aware of any country where such a systematic and rigorous approach is being taken to driving industry convergence. Those who study Korea know that this approach is nothing new for them – long term research and strategic planning are acknowledged to have played a major role in the evolution of its knowledge economy and rise of Korea and its technology brands on the global stage. Coming from the UK, where it seems that long term thinking and national policy are now long lost relatives, I wonder why it is that so few countries are willing to or capable of taking such a strategic approach.

Rohit on the Road

In the next few months Rohit will delivering speeches in Oslo, Paris, Vilnius, Warsaw, Frankfurt, Helsinki, Denver, Las Vegas, Oman, Leeds and London. Topics to be covered include human enhancement, the future of professional services, the future of HR, transformational forces in business, global drivers of change, how smart businesses create the future, the future technology timeline, the future of travel and tourism, the future of airlines and airports and the future of education. If you would like to arrange a meeting with Rohit in one of these cities or are interested in arranging a presentation or workshop for your organisation, please contact rohit@fastfuture.com

Isn’t graphene fun?

I’ve just been checking up on progress on supercapacitors to see if they are up to the job of replacing car batteries yet. It looks like they will be soon. Supercapacitors have lower energy density than lithium batteries, but can be charged extremely quickly.

My favoured technique is to build mats into the road surface every 50 metres (i.e. same as streetlights), and to charge the supercapacitor bank using induction as the car passes over them. That means that even a small energy capacity would be adequate. It wouldn’t have to power the car for 100 miles or more like a battery, but only for the first and last few kilometres of a journey where there are no mats. Otherwise, range wouldn’t be limited as it would charge all the time on the trip.

However, a few minutes ago I had another little spark of enlightenment. Why not also use the pads for propulsion too, using a linear induction motor?  (I like those)

If the pad gives an impulse to the car as well as a capacitor recharge, then the capacitor won’t need to be as big. And if the impulse is gentle enough, passengers won’t feel a jolt every time they drive over one.

Another little insight, hardly worthy of the name, is that with trains of self driving pods, the pods could be so close together on most journeys that they effectively have a continuous circuit from one end of the train to the other. That means that public transport pods that are only used locally and on certain routes might be able to get by with tiny capacitor banks.