Thomas Frey's Blog, page 49

Empowering “Things” for Our Internet of Things

In much the same way that we now expect every child’s toy to talk, in the future, we will expect virtually everything we own to be connected to the Internet.

Our mushrooming “Internet of Things” is growing exponentially, and estimates of its progression vary tremendously. GSMA estimates connecting 24 billion devices by 2020, while Cisco and Ericsson think we will hit 50 billion.

Depending on a few key breakthroughs, these estimates may all be on low end, and here’s why.

Telecom carriers are primarily concerned about devices that connect directly to the Internet, but a rapidly growing category of peripheral devices are designed to connect indirectly through smartphones, home or office Wi-Fi, or other smart devices.

Here are some of the innovations that could make this whole industry go viral.

Internet of Things – A Brief History

In a recent report by Cisco, the writers determined the Internet of Things was officially born between 2008-2009. This was the point where the number of devices exceeded the number of people on earth.

The number of connected devices per person reached 1.84 in 2010.

For some of us geeks, that number may seem low. This is because Cisco’s calculations were based on the population of the entire world, much of which is not yet connected to the Internet. By reducing the population sample to people actually connected to the Internet, the number of connected devices per person rises dramatically.

Since approximately 2 billion people use the Internet today, the number of connected devices per person in 2010 jumps to 6.25 instead of 1.84.

Internet of Things Ecosystem

From Beecham Research, the diagram above represents the Internet of Things ecosystem in different industry sectors like energy, healthcare, science, transportation, retail and others.

A 2011 study by Machina Research projected a sevenfold increase in revenues by 2020, creating a $1.2 trillion market opportunity for the wireless industry.

So where exactly are these opportunities? The study projected the following breakdown:

Consumer electronics – $445 billion
Automotive – $202 billion
Health – $69 billion
Utilities – $36 billion

“We are moving into a new era in connectivity where we will see the proliferation of billions of connected devices in the world. Most of that growth is coming from machine-to-machine: a new market for communications service providers, and with new dynamics,” says Jim Morrish, Director at Machina Research. “The way that mobile operators, device vendors, service providers and others in the value chain react to this opportunity will have important implications for their future success. Right now, the mobile industry has a clear opportunity to play a central role in the Connected Life.”

Viral Peripherals

While most of the world is focused on adding intelligence to high dollar items such as cars, refrigerators, washer & driers, and lawnmowers the true connectedness revolution will happen with inexpensive low-end devices that only cost pennies to manufacture.

As pricing drops, manufacturers will routinely add everything from identification chips to freshness sensors as a part of nearly all of their packaging. Here are a few examples:

GPS Locator Devices: Creating simple GPS trackers that could be applied as a sticker would be an instant hit. These micro-tracking devices would make everything from purses, to cellphones, to car keys, to wallets instantly findable. Each person would have their own sphere of objects they could track and find instantly.

The Billion-Cam Video Network: If someone invented a simple, inexpensive solar or RF powered video camera that could easily be connected to a home or office Wi-Fi, there would be a mad rush to purchase them as an instant video security system. So what would it take to get people to connect 1 billion video cameras to the Internet? We may soon find out.

Personal Food Network: Most people have a hard time keeping track of all the food they have in their house at any given time. If the food industry started adding smart tags to all their packaging, simple apps could be created that monitor freshness, inventory, recommend possible meals, and creates grocery lists for the next time someone goes shopping.

Single Use Sensors: As soon as the iPhone was introduced with motion sensor technology, creative people around the world began asking the very simple question, “What other things can we do with motion sensors?” And the answers that app developers have come up with are more than a little ingenious.

So without waiting for smartphone companies to incorporate features into the smartphone itself, remote sensors with wireless signaling can open up opportunities in a spectacular fashion. To stir your thinking a bit, here are a few sensors that come to mind:

Pressure Sensors: Anything that our physical body comes into contact with such as shoes, football helmets, pillows, chairs, and mattresses will be prime candidates for pressure sensors.
Chemical Sensors: Are oxygen levels too high or too low? Why did this lotion burn my skin? Are there signs of mold and mildew in the carpet?
Reflectivity: Will this paint cause my house to heat up or cool down? Do these windows let light in or reflect most of it away?
Heat Sensors: These sensors will give us an understanding of all the micro-environments we exist in showing temperature variations inside and outside of clothing, above and below blankets, and in houses along pipes, windows, and any external walls.
Moisture: Are these plants too wet or too dry? Is there a moisture leak in the ceiling? Does the diaper need changing?
Vibration: Any piece of machinery that starts vibrating in an unusual manner is giving signs that something is wrong.
Frequency: The sound and noise environments that we exist in play an important role in our health. An ability to map and trace frequencies throughout our day will give us amazing insight into both the audible and non-audible communities of sounds we find ourselves in.
Smell and Odor: Should I enter that perfume shop or will it make me sick? Where is that odor coming from? Is this food fresh or stale?
Spectrometer: Does this soil have the right kind of fertilizer? What kinds of chemicals are present in this makeup? Is there a chance carbon monoxide may be present?
Speed: How fast is that horse running? How fast is that bird flying? At this pace, how long will it take for this snail to work its way over to the window?

Smart Dust 

In the 1990s, Kris Pister, a researcher at UC Berkley dreamed up the idea of sprinkling the Earth with countless tiny sensors, no larger than grains of rice.

These “smart dust” particles, as he called them, could be used to monitor everything. Acting like electronic nerve endings for the planet and fitted with computer processors, sensing equipment, wireless radios, and extended life batteries, smart dust would have the capabilities of providing huge volumes of real-time data about people, cities and our natural environment.

Future designs for smart dust will have them detecting everything from moisture content, to soil temperature, to chemical composition.

Farmer’s fields will be glowing with information. Whereas most have had the option in the past of selling “rights” associated with the land – water rights, mineral rights, and now wind rights – future farmers will also have the option of selling information rights.

Information gleaned from smart dust will be far more granular and instantaneous than any current information gathering technologies.

Data streams coming from these plants give them a “voice” that will help us better understand the idiosyncrasies of the world around us.

Final Thoughts

The topics I‘ve mentioned are only scratching the surface.

The number of linked sensors, cameras, and complex peripheral devices are already exploding around us, and ingenious people will figure out new and unusual ways to blend these streams of information into a cohesive intelligence layer that we can interact with in our daily lives.

As you might imagine, attempts to improve the sphere of knowability for purposes of convenience and safety will be confronted with serious resistance from those wishing to maintain a distinct layer of privacy for our protection. These will be tough decisions to wrestle through and the resulting public policy decisions will have far-reaching implications.

In the mean time, vast fortunes will be won and lost, as the Internet of Things becomes part and parcel to our daily lives.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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In Search of the Next Great Addiction

“What exactly do you do here, I’ve been meaning to ask. Because I’m the producer, right? I cook. But from what I can tell, you are just a drug addict! You are a pathetic junkie too stupid to understand and follow simple rudimentary instructions!” – - Walter White from the hit TV show “Breaking Bad.”

Addiction is a word seething with negative connotations. It implies that someone is out of control with their life, making bad decisions with their money, and placing everyone around them at risk.

While we’ve all heard the horror stories associated with drug addiction, we have only recently begun to grapple with the overarching implications of the gadgets and technologies rapidly permeating our lives.

Our technology is consuming virtually all of our attention. Even our dogs have resigned themselves to the fact they are no long man’s best friend.

But while those who are desperately concerned with the wellbeing of our society are raising red flags, the business world is being incentivized to create technologies that elevate our addictions even further.

Here are a few thoughts on the likely turmoil ahead.

Measuring Up on the Addiction Scale

The reason Facebook stock took a nosedive after their IPO was because it wasn’t addictive enough. Even though it was consuming the attention of one out of every five people going online, Wall Street wanted more.

Even though Groupon practically invented the deal-of-the-day industry, it’s stock tanked after its IPO because customers who became addicted to their offers weren’t viral enough to maintain the same trajectory over time.

How different is this from the cigarette industry?

A study done by the Massachusetts Department of Public Health showed that between 1998 and 2004, at the same time that massive public health campaigns were being mounted to curb smoking, cigarette manufacturers increased the amount of addictive nicotine delivered to the average smoker by 10%.

Sadly, the underlying systems that incentivized raising the addictive nature of cigarettes are the same as those forcing tech executives to devise strategies to elevate the addictive nature of their offerings.

Four Key Drivers

As we dive deeper into the addictive nature of our online world, what exactly are we becoming addicted to?

Unlike the physical cravings and biological needs that drive our addiction to drugs and cigarettes, our gadget-driven access to the Web feeds the pleasure center of the brain in far different ways.

Here are four key drivers behind online addiction.

Hyper-Awareness – With the pervasiveness of smartphones and instant connectivity, we are living in a society that is jacked-in 24-7 to the world around us. For some of us, our unquenchable thirst for information is creating a compelling need for more, and that thirst is permeating virtually every facet of our lives.
Socialization – Whether it’s Facebook, Twitter, e-mail, texting, or an online game, people love being connected with like-minded individuals. In many of these social circles, if you’re not constantly connected you’ll miss out.
Accomplishment – For Type-A personalities and accomplishment junkies, a variety of productivity, multi-tasking, and time-crunching tools can heighten both the quality and quantity of accomplishments made by any one person. In our incessantly competitive world, the one-upmanship of each new achievement can be very addictive.
Escape – For anyone wanting to escape the stresses of daily life, the Internet offers exponentially more options than anything possible in the physical world. While it still lacks the intimacy of human touch and physical presence, it can be used to both facilitate and accentuate those interactions and much more.

No, a person who is addicted to checking their e-mails does not face the same consequences as someone pulling the lever on a slot-machine. And someone obsessed with online video games does not inflict the same kind of physical damage to their bodies as drug addicts.

But every obsessive personality trait, whether enhanced by technology or not, has a way of distorting human potential. The lure of constant stimulation, the pervasive demand for pings, tweets, and updates, creates a profound physical craving that can hurt productivity and personal relationships.

Time and Attention Addiction

A recent survey done in multiple countries showed that over 70% of people now take their smartphones and other devices along on vacation. Our always-on generation is finding it increasingly difficult to detach from the online world.

When it comes to work, according to the Organization for Economic Cooperation and Development, Americans are continually pushing the envelope.

Americans now put in an average of 122 more hours per year than the British, and 378 hours more than Germans. Going beyond working hours, virtually all of the other countries take weekends off, have paid vacation time, and paid maternity leave.

We live in a society that is being driven by work, and the tools that keep us connected are beginning to permeate every waking moment.

Winning the Addiction Game

A few years ago we often joked about the “crackberry” lifestyle. Blackberries were the tool of choice for the hyper-connected. How quickly times have changed!

Today we have a wide assortment of handhelds and tablets to keep us connected, and over the coming years we will be switching to wearable devices inside our clothes, worn as accessories, and somehow attached to our bodies.

Even though virtually every tech company has voiced concern over people who abuse their technology and can’t let go, they also have to feed the economic engines that keep them on top.

It’s still in their best interest to not only get people hooked, but also to both drive and perpetuate these obsessions to the fullest.

With money still being the primary incentive for business, companies who create the most loyal customers, even though they may suffer from addiction, will end up as winners.

Final Thoughts

Business has always been about getting people to fall in love with a product and constantly want more. So what is it that makes these products different, more addictive, and more dangerous? Well, it all boils down to the loss of self-control, and its still not clear to me whether the onus of responsibility stemming from this kind of abuse should be shifted onto the company that creates the product or service.

In much the same way Eddie Morra, the character played by Bradley Cooper in the movie “Limitless,” became addicted to the mental focus and clarity of the drugs he was taking, the online world is continuing to open vast new playgrounds for the mind that continually stimulate our own moth-to-a-light impulses.

The buyer of addictions is viewed entirely differently than the creator of addictions. Buyers are viewed as victims, creators, at least in the tech world, as our heroes.

Success is often determined by which company creates the most addictive product.

As I end this, I’d love to hear your thoughts. Is addiction to technology too strong a term? Is this something we’ll be able to innovate around? How flawed are the systems that govern business and technology? Are we in serious trouble?

Sorry, but I need to go now because I’ve only checked my email 72 times this morning and someone is bound to be feeling ignored if I don’t get back with him or her this very instant.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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Anticipatory Computing: Unlocking the Ultra-Human in All of Us

Anticipatory Computing’s latest trends (yuliang11/Photos.com)

Wouldn’t it be great if you could turn on your television and it instantly knew what show you wanted to watch?

We all dream of an easier life, so what if we got into our car and it knew where we wanted to go, or turned on a radio and it played the perfect music, or pressed “call” on our phone and we would instantly be connected to the person we most wanted to talk to.

Our days are filled with countless decisions and the stress level of all these choices is growing steadily. Yes, we want to be in control, but control can be very taxing.

That’s why I was so intrigued when I came across a new iPad app called MindMeld that is based on the emerging science of “anticipatory computing.”

Using video and voice chat capabilities similar to Skype, MindMeld not only facilitates the discussion, but also adds pertinent photos or videos to the conversation as it interprets what is being said.

We tend to worry about computers that are smarter than we are, automating our skills and taking our jobs. But if computers become more human-like in their thinking, adding our own emotional values to everything we think is important, the heartless machine-only qualities of these technologies will disappear, moving computers away from the paradigm of human-replacer to something more akin to human-enhancer. Here’s what I see happening.

Tim Tuttle playing with MindMeld

The MindMeld Approach

The founder of MindMeld is serial entrepreneur, Tim Tuttle, who previously launched Truveo, a video search engine that was sold to AOL.

Tim is quick to point out that the MindMeld approach is quite different from other semantic models that base their decisions on usage history. Rather, the MindMeld approach is to look at the past 10 minutes of activity and then anticipate what users might need in the next 10 seconds.

“We have a predictive model that changes second to second and surfaces relevant information without searching,” says Tuttle. He views this as an effective application of “anticipatory computing” because of the predictive nature of its computational decision-making.

Over time, MindMeld will accrue intelligence as it becomes better at reading and aggregating ambient data.

Capturing Real Human Intelligence

Artificial intelligence only goes so far. But finding a way to capture pieces of real human intelligence can give us far more pertinent information.

As example, if someone conducts a typical search on a search engine, the connecting path between the search terms and the final destination is a very real piece of human intelligence.

Certainly not everyone will agree on the final site selected from a set of search terms. But that will improve over time.

According to Futurist John Smart, in 1998 the average online search phrase consisted of 2 words. Today, the average search contains 5.2 words, trending towards something far longer, more akin to a natural question of 8-10 words.

Over time, capturing millions of “paths” will yield a base of growing intelligence based on the cumulative thinking of everyone involved.

Similarly, when groups of people get into a conversation, and a variety of images are displayed, a selection process where users click on applicable images to help refine the “yield,” the anticipatory computing process will get much smarter, and more relevant, over time.

Refining the Relevance Algorithm

Gone are the days where computers only recognize keyboard inputs. Combining a variety of ambient information such as the user’s social graph, search and surfing history, dwell-times associated with photos and videos, purchase history, and even music preferences helps define who we are.

Computers can’t read our minds, at least not yet. However, by paying close attention to all of our inputs and outputs, the information we consume and how we respond when we consume it, anticipatory computing can develop a very close approximation to the inner working of what our mind is telling us to do next.

Moving one step further, by capturing verbal conversations surrounding videos and photos, as is done with MindMeld, we can begin to automate the metadata and searchable tagging systems surrounding both physical and digital objects.

Thinking even farther into the future, as users add sensory capturing devices to their clothing, phones, and skin (as in tattoos), we will begin to translate emotional data into a complex value system that can better determine our opinions without us having to personally make decisions. At least not all of the ones we currently do.

It would be similar to having our own invisible clone taking surveys and making decisions and value judgments on our behalf.

Final Thoughts

We have gone from crude computational devices like the abacus and slide rule, to punch card readers, to memory storage and retrieval devices. By adding the complex communication capabilities of the Internet to our once isolated computers, we have begun an exponential climb towards developing a sort of cyber humanism.

Until now, computers have been trending along the bottom part of this transitional curve going from cold, heartless machines to something more warm and fuzzy with human-like qualities. But so far, we’ve only scratched the surface.

In the very near future, computers will be christened with a higher purpose than making us slaves of the Internet. Instead, they’re destined to make us more human, even ultra-human.

So the real difference is not an “either-or” proposition that pits humans against computers, but rather a “both-and” option where we use computers to enhance our abilities and magnify our own personalities.

Yes, someone who is prone to making bad decisions could theoretically make ten times as many bad decisions in a single day. This would be like someone who gets indebted to a loan shark having the potential of getting indebted to ten of them simultaneously.

But trusting we can solve the downside problems, anticipatory computing has a tremendous upside.

Rest assured, this will just be another step in the ongoing evolution of computers. There is no magic formula for solving every problem. But anticipatory computing has the potential to ratchet us up far faster than anything before. So look for an exciting wave of new ideas to spring from this new twist in thinking.

Does this mean we are getting closer to being assimilated into a StarTrek-like Borg? Perhaps. But maybe the Borg won’t be as bad as we’ve been led to believe.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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Driverless Highways: Creating Cars that Talk to the Roads

Speaking at “Mobility Day” in Shanghai

Yesterday I had the privilege of speaking at a conference on the “Future of Mobility” in Shanghai, China. The event was produced by the very forward thinking people at Lanxess, a German-based chemical company that broke ground the day before on a new facility to expand its already significant base of operation in Shanghai.

As the world’s leading producer of synthetic rubber for the automotive industry, Lanxess is very interested in positioning itself at the forefront of our mobile future. And one of the biggest trends for this industry is the push to make vehicles driverless.

While most people have been focusing on the driverless technology inside the vehicle itself, where noteworthy accomplishments seen to be happening on a daily basis, the shift will also cause huge changes to occur in area’s like insurance, public policy, parking, delivery services, and especially highway engineering.

Even though the art of road building has been continually improving since the Roman Empire first decided to make roads a permanent part of their infrastructure, highways today remain as little more than dumb surfaces with virtually no data flowing between the vehicles and the road itself. That is about to change, and here’s why.

China’s Car Market

The number of cars in the U.S. works out to 800 for every thousand people. In Japan, that number is 600 per thousand and South Korea, slightly under 400. But in Shanghai, the car per person ratio currently stands at 169 cars per 1,000.

While the people of China own a smaller percentage of vehicles than other countries, their wealth is increasing rapidly and more cars will soon add additional layers of complication to their already crowded streets.

But the Chinese government is acutely aware of this problem. Restrictions are already in place to limit the number of vehicles that can be licensed inside some of the larger cities like Shanghai and Beijing.

So where does that leave people who wish to become part of this emerging mobile lifestyle? Going driverless may hold some exciting new options.

Going Driverless

Driverless technology will initially require a driver, and it will creep into everyday use much as airbags did. First as an expensive option for luxury cars, but eventually it will become a safety feature required by governments.

The greatest benefits of this kind of automation won’t be realized until the driver’s hands are off the wheel. With over 2 million people involved in car accidents every year in the U.S., it won’t take long for legislators to be convinced that driverless cars are a safer option.

The privilege of driving is about to be redefined.

Many aspects of driverless cars are overwhelmingly positive, such as saving lives and giving additional years of mobility to the aging senior population. However, it will also be a very disruptive technology.

Driverless technologies will be blamed for destroying countless jobs – truck drivers, taxi drivers, bus drivers, limo drivers, traffic cops, parking lot attendants, ambulance drivers, first responders, doctors, and nurses will all see their careers impacted.

If done correctly, driverless vehicles may even deal a fatal blow to the auto insurance industry.

Image of what a driverless car “sees”

Creating Cars that Talk to the Roads

As cars become equipped with driverless technology, important things begin to happen. To compensate for the loss of a driver, vehicles will need to become more aware of their surroundings.

Working with cameras and other sensors, an onboard computer will log information over 10 times per second from short-range transmitters on surrounding road conditions, including where other cars are and what they are doing. This constant flow of data will give the vehicle a rudimentary sense of awareness.

With this continuous flow of sensory information, vehicles will begin to form a symbiotic relationship of sorts with its environment, a relationship that is far different than the current human to road relationship, which is largely emotion-based.

For this reason, it would be foolish of highway engineers to ignore the opportunity to build roads as intelligent as the vehicles that drive on them.

An intelligent car coupled with an intelligent road is a powerful force. Together they will accelerate our mobility as a society, and do it in a stellar fashion.

Lane Compression – Highway lanes need only be as wide as the vehicles themselves. Narrow vehicles can be in very narrow lanes, and with varying sizes and shapes of vehicles, an intelligent road system will have the ability to shift lane widths on the fly.
Distance Compression – With machine-controlled vehicles, the distance between bumpers can be compressed from multiple car lengths to mere inches.
Time Compression – Smart roads are fast roads. Travel speed will be increased at the same time safety is improved.

In the driverless era, intelligent highways will be able to accommodate 10-20 times as many vehicles as they do today. Counter to traditional thinking about vehicle safety, the higher the speeds, the fewer the number of vehicle on the roads at any given moment.

As we compress the time and space requirements of every vehicle, we will be able to achieve a far higher yield of passenger benefits per square foot of road resources.

In addition to the benefits passengers receive, the road itself can greatly benefit from this technology. With cars constantly monitoring road conditions, the road itself can call for its own repair.

Rather than waiting until a road becomes a serious hazard, as is currently the case, and repair crews disrupt traffic for hours, days, or longer, micro repairs can happen on a daily, sometimes hourly, basis. High-speed coatings and surface repairs can even be developed for in-traffic application.

Even treacherous snow and ice conditions will have little effect if deicer is applied immediately and traffic is relentless enough.

On-Demand Transportation

In the same way people hail a cab, people in the future will use their mobile devices to summon a driverless vehicle whenever they need to travel. Without the cost of drivers, this type of transportation will be infinitely more affordable, for most, less than the cost of vehicle ownership.

So rather than buying a car, and taking on all the liabilities of maintenance, upkeep, and insurance, consumers will simply purchase transportation whenever they need it.

As the transition is made to driverless vehicles, the number of vehicles sold to individuals will begin to decline, and a growing percentage will be to large fleet operators offering the new “transportation on-demand” service.

In response to declining car sales, the automotive industry will adopt a “selling transportation” model where, rather than “selling” cars to fleet operators, car companies will begin charging a nominal per-mile charge.

Fleet operators will love the arrangement because there will be no large up-front purchase price, but instead, only a small monthly fee based on the number of miles driven.

As the sale of cars begins to decline, the automobile industry will start to design and manufacture cars capable of driving over 1 million miles. By collecting a small per-mile fee over the life of a million-mile car, automobile manufacturers will have the potential of earning ten times as much, per vehicle, as they do today.

This will mean all car parts and components will need to be designed more durable, longer-lasting than ever before. Both quality and design standards will be pushed to new levels.

Focus on the “rider”

Shifting from the “Driver” Experience to the “Rider” Experience

Car designers today spend the vast majority of their time trying to optimize the driver experience. After all, the driver is the most important part of the ownership equation. But that will soon change.

In the “driverless era,” the focus will shift to passenger comfort and passenger experience. Fancy dashboards displaying dazzling amounts of information will become a thing of the past as riders obsess more over the on-board movie, music, and massage interfaces.

Some cars operations will be more conversational in nature, pairing socially compatible riders in a way to maximize the conversational benefits of like-minded individuals. Others will stress the benefits of alone-time, offering a peaceful zen-like experience for those wishing to escape the hustle and bustle of work-life.

The China Advantage

China doesn’t need more cars, it needs more transportation.

They already understand time compression, using high-speed rail systems to reduce the travel time on the Beijing–Tianjin Intercity Railway from 70 to 30 minutes.

Similarly, the Beijing-Shanghai High-Speed Railway that opened in June 2011 reduced the 819 mile distance between the two largest cities in China to under 5 hours.

With the coming turnover in infrastructure, more in the next 20 years than in all human history, countries that can make decisions fastest, and perform quickest, will have a huge advantage.

China has demonstrated time and again that they can make things happen quickly.

Final Thoughts

We are all terminally human, and human fallibility lies at the heart of the transportation conundrum. We all love to drive, but humans are the inconsistent variable in this demanding area of responsibility. Driving requires constant vigilance, constant alertness, and constant involvement.

However, once we take the driver out of the equation we solve far more problems than the wasted time and energy needed to pilot the vehicle.

But vehicle design is only part of the equation. Without reimagining the way we design and maintain highways, driverless cars will only achieve a fraction of their true potential.

Combining smart cars (driverless) with smart highways (also driverless), we can begin to envision a far brighter future ahead.

In the end, we will be driving towards a far safer and more resilient society, but we still have a few bumpy roads to go down in the mean time.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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Creating the ‘Builders’ of Our Future

As something of a grand finale to their 11-week, full-immersion Ruby on Rails class, our first graduating class of DaVinci Coders took the stage on Demo Day to talk about the projects they worked on.

To me it was quite remarkable listening to the stories of transformation that occurred as students with no coding background whatsoever managed to immerse themselves in this new field and produce some extraordinary apps.

This class represents the next generation of “builders” who are taking over the world, because inside these lines of code lies the foundational underpinnings of the future.

Builders of the past have included people like architects, manufacturers, construction workers, and material fabricators. However, people in those professions are passing the baton to a new breed of builders skilled in things like digital architecture, intelligence work, and information fabrication.

To paraphrase the famous words of President Kennedy, “We choose to go to the moon, not because it’s easy, but because it’s hard.” Creating a digital foundation for our future will indeed be hard, but here’s why we should be welcoming this challenge.

The War Between Atoms and Electrons 

While most people don’t think of it this way, there is a war going on between atoms and electrons. Atoms represent everything in the physical world and electrons are the embodiment of our digital world.

Digital products are being created exponentially faster than anything that requires the manipulation of physical materials. Companies today are making conscious decisions about whether they should be working with physical products or digital ones.

Physical products require the use of raw materials, designers, engineers, shipping & receiving, inventory, warehouse space, shelf space, marketing & sales, and most importantly, physical products have tax implications. Digital products, on the other hand, can eliminate 90% of the work involved in producing and distributing material goods.

Companies producing digital products are moving far faster than those creating physical ones, simply because they can.

As a result, we are witnessing a brain drain as employees leave their physical-world jobs in transportation, manufacturing, and service industries to move into positions in digital companies because that is where all the excitement is.

People moving into the information space, like the students at DaVinci Coders, are at the forefront of this cultural shift.

The Shedder Generation

Baby boomers have become a generation of shedders. Gone are the days of them seeing who can own the most stuff, and as they head into retirement, we are seeing increasing amounts of stuff headed towards the trash heap. As they pursue a more manageable lifestyle boomers are “shedding” their belongings.

However the boomers are not alone. Virtually every category of consumer is spending less on physical products and more on non-physical ones such as digital products, online education, and personal experiences.

An obvious shift when digital technologies started affecting physical industries 

The chart above shows the shift that occurred around 2000 as the emergence of Internet technologies started affecting real world businesses.

Today, it is much more likely that someone will read a digital book instead of its physical counterpart. Similarly people are much more likely to download digital music, photos, movies, or games rather than purchase their tangible equivalent on CDs, paper, or vinyl.

To many, the physical world is the underlying culprit of most of their problems:

A recent study by Zillows shows that a full 48% of homeowners younger than 40 are underwater on their home mortgages.
When it comes to car loans, recent estimates show upwards of 79% underwater in this same under 40 age group.
In 2010, the average manufacturing wage in China was $2.00 per hour compared to $34.75 per hour in the U.S.
Business spending on nonresidential physical structures is roughly 30% below the 2007 pre-recession highs, while investment in software and digital products is up almost 20% over the same period.

For people seeking a career change, the digital world is becoming very attractive. In a recent study by Wanted Analytics, the number of job postings for Ruby on Rails positions increased 35.8% between 2010 and 2011. At the same time, the number of job postings for JavaScript positions increased 17.7%

Timothy Clayton (sitting) and Allison Jones presenting their project at

DaVinci Coders Demo Day

Dispelling the Myths

Contrary to what many believe, our new generation of coders are NOT:

Geeks in the basement. Today’s software engineers are highly paid professionals working out of highly desirable office spaces.
Just a bunch of math majors. Todays coding work is not about writing mathematical formulas. Instead, coders today have a wide array of toolsets at their disposal, and the work involves good problem-solving skills and an in-depth understanding of the available tools.
A guys-only club. While it’s true that the software and the coding world is very male-oriented, organizations such as RailsBridge are springing to life to change the gender imbalance. One of our DaVinci Coders, Elaine Marino, said it best when she recommended, “If you want more women to participate in these events, you need to switch from pizza and beer to wine and cupcakes.”

Enter Big Data

We’re entering an era where business and society are being run by something akin to a digital nervous system.

Managing customer relationships, payments, and product fulfillment are part of our next generation digital ecosystem.

According to a recent study by Capgemini, big data is becoming as fundamental to business as land, labor, and capital has been in the past.

“It’s not only through harnessing the many new sources of data that organizations can obtain competitive advantage. It’s the ability to quickly and efficiently analyze that data to optimize processes and decision-making in real time, that adds the greatest value,” says Capgemini Global Sales Director Paul Nannetti. “In this way, genuinely data-driven companies are able to monitor customer behaviors and market conditions with greater certainty, and react with speed and effectiveness to differentiate themselves from their competition.”

As technology evolves, each next-step results in an exponential growth in data volume.

Over the coming decade the vast majority of businesses will be transitioning 100% of their day-to-day operations online. As this happens, the digital nervous system will grow in complexity and capability in ways we can only begin to imagine.

Final Thoughts

The online world is still a mystery to most people.

As an example, a recent study by Wakefield Research showed 54% of people in the U.S. claim to never use cloud computing, but over 95% actually do. A full 65% bank online, 63% shop online, 58% use social networking sites, 45% have played online games, 29% store photos online, 22% store music or videos online, and 19% use online file-sharing. All of these services are cloud based. Even when people don’t think they’re using the cloud, they really are.

Yes, we do it unconsciously, but we are constantly comparing the online world to the physical world.

We compare the price of online products to in-store products.
We compare to cost of driving across town to meeting them virtually through Skype or related services.
We compare the cost of cable TV with web-based TV services such as Hulu and Netflix.
We compare downloadable games to physical games.

Even though we’ve come a long ways, we are only beginning to scratch the surface of what’s possible, and the “digital builders” of today are setting the stage for our global work and living cultures of the future.

The speed of electrons are 1,1160,000 times faster than the speed of a car. But speed is only one factor. We still need places to live, food to eat, and the comfort of living.

The bigger question in my mind is, after we rebuild our world digitally, what comes next?

NOTE: For those interested in finding out more about DaVinci Coders, go to www.davincicoders.com or call Deb at 303-666-4133

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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Competing with Robots

During the late 1990s business and industry began to panic over the issues surrounding Y2K, which later turned out to be mostly manufactured fear.

In the chaotic world around us, it has become increasingly difficult to separate genuine problems from manufactured fear. And it is especially difficult to make plans for the future when we can’t properly gauge the severity of a legitimate issue we know we’ll have to deal with.

As we begin to wrestle with “2 billion jobs disappearing by 2030,” clearly a subject we’ll need to deal with sooner rather than later, it’s easy to get lost in the problems instead of the solutions.

That said, gauging a proper response is not easy. On one hand, dealing with the Y2K issue will seem like child’s play compared to this kind of massive job loss. However, throwing trillions of dollars at it, as we did with the 2007-2008 Global Financial Crisis, may indeed be a wrongheaded overreaction.

For this reason I’d like to talk through the coming era of automation and point out some of the hopeful signs I see for the brighter future that lies ahead.

Robots in the Tesla car factory in Fremont, CA

Parallel Paths – Communication and Automation

Automating our physical world is easily half a century behind the digitization era that was ushered in with mainframe computers back in the 1960s.

There are many parallels between the large robotic arms that we see in automotive manufacturing today and those early mainframe computers. Seeing big machines in industrial settings, with teams of highly skilled engineers operating them, makes it difficult for us to imagine an equivalent machine in our homes.

Going from mainframe computers to desktops that average people could use was quite a leap.

Transitioning from industrial robots to personal ones will be equally disruptive.

More recently, the transition from desktop computers, to laptops, to mobile devises has caught many people off guard.

With similar stages of mechanization, an equivalent evolution will take us from home-based robots to unusual forms of mobile automation that we control personally.

The Economics of Automation

Our economy is based on people. Humans are the buying entities, the connectors, the decision-makers, and the trade partners that make our economy work.

Without humans there can be no economy.

Generally speaking, when a person buys tools, it increases their capability, and by extension, increases the scope of them as an economic entity.

When a person buys a computer and becomes proficient at using it, this added piece of digitization increases their capabilities, their earning power, and their sphere of influence as a consumer. In general, people with computers earn and spend more than people without computers.

Similarly, people who own cars, homes, and businesses tend to earn and spend more than people without them. Ownership and control becomes part of our personal toolbox, granting us increased capabilities and thereby added clout to our economic entity.

Since the capabilities granted by owning a computer connected to the Internet can be far more scalable than owning a car or home, its influence upon economic theory has been largely underestimated.

We will encounter similar underestimations as we combine the scalability of Internet-connected automation to the capabilities of a person in the years ahead.

From Mobile Communication to Mobile Automation

Smart phones are far more than a communications device. In fact, we have only begun to scratch the surface of understanding the true scope of their capabilities. But putting them into the proper context, they are an extension of the capabilities of the person who operates them.

Over the coming decades we will see a similar transition to smart automation devices that we personally own and operate. They will extend our capabilities in ways we cannot yet imagine, and give rise to business models that leverage the hyper-human capabilities stemming from this shift.

3D Printer Model

As we look around we see 3D printers springing up in unusual places. 3D printers are a form of automation that has already reached the hacker stages of mid-1980s computers.

In the coming years, when we find ourselves needing a replacement part, we will no longer have to get the part from the manufacturer on the other side of the planet. Instead we will be able to print the part ourselves…. or so we’ve been told.

Printing a physical part to match the exact specifications of the one it’s replacing will require an operator finely attuned to the intricacies of this type of manufacturing.

As an example, not all operators will have access to the right materials. Some parts will require an extra smooth finish or added texturing to make it work. Understanding tolerances, levels of reflectivity, specific gravity, reaction to temperature variations, vibration, or surrounding chemicals are all points of consideration.

Printing our own replacement part is not likely. It will require far more skill and attention to detail than most of us possess. But finding someone close by is indeed a possibility.

So does human-plus-machine equate to greater localization? In most cases, yes.

Final Thoughts

Competing WITH robots is far different than competing AGAINST robots. When we add machine skills to the resume of an individual we end up with a far different equation.

So the coming decades will be far less about humans competing against machines and far more about how we can leverage them to our advantage.

We are still a long ways from creating Hollywood style robots with an emotional mind capable of making value judgments that we can rely on. But we are very close to leveraging machine capabilities in far more interesting ways.

If we combine the capabilities of a Transformer with the utility of 3D printers and the portability of a Swiss Army knife we can begin to see the possibilities that lie ahead.

Machine-based automation will revolutionize our world every bit as much as computers have.

To answer the questions I posed at the beginning, some of the fear of job loss is real and some of it is manufactured. But what cannot be lost in this discussion is the need for a rapid transitioning skill base where we quickly identify a need and train people to fill it.

Machines can become our greatest asset or our greatest liability. It’s up to us to decide.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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Building Remarkable Communities of the Future

In the late 1980s I was still working at IBM, but had taken on a number of side projects to expand my horizons. One of those projects was working with the City of Denver on the redevelopment of Stapleton Airport.

At the time Stapleton was still in operation, and the new airport, DIA, was little more than a politician’s dream with a bunch of drawings and reports being pitched to the media.

Leading the charge was Denver Mayor Fedrico Pena who had decided to make the new airport the centerpiece of his administration, and several staffers were working full-time to make sure this dream would become a reality.

While most people were focused on the issues and opportunities surrounding the new airport, I was focusing on what I believed was an even bigger opportunity – redeveloping the 4,700 acres of prime real estate in the heart of Denver that would come available once the airport was moved.

To me, this was a once in a lifetime opportunity to create something remarkable, and I was working overtime to help make it happen.

So what is it that separates a great community from a remarkable one? And more importantly, how will these criteria for “being remarkable” change in the future? Follow along as I fill you in on the rest of the story.

Becoming “Remarkable”

Famed marketing guru Seth Godin has built his career around helping companies become “remarkable.” If you break the word into its two parts – remark + able – you can begin to grasp its true meaning. The word “remarkable” is what separates things that people talk about from those that never get mentioned.

Pushing the concept of “being remarkable” even further, Godin goes on to make the following points:

Remarkable doesn’t mean remarkable to you. It means remarkable to me. Am I going to make a remark about it? If not, then you’re average, and average is for losers.
Being noticed is not the same as being remarkable. Running down the street naked will get you noticed, but it won’t accomplish much. It’s easy to pull off a stunt, but not useful.
Extremism in the pursuit of remarkability is no sin. In fact, it’s practically a requirement. People in first place, those considered the best in the world, these are the folks that get what they want. Rock stars have groupies because they’re stars, not because they’re good looking.
Remarkability lies in the edges. The biggest, fastest, slowest, richest, easiest, most difficult. It doesn’t always matter which edge, more that you’re at (or beyond) the edge.
Not everyone appreciates your efforts to be remarkable. In fact, most people don’t. So what? Most people are ostriches, heads in the sand, unable to help you anyway. Your goal isn’t to please everyone. Your goal is to please those that actually speak up, spread the word, buy new things or hire the talented.

Pushing us in the other direction is a world that trains us from youth to play it safe, stay in our place, and don’t make waves. This push for conformity also makes us the most expendable.

People who are unremarkable are the ones most likely to lose their jobs when mass layoffs are announced. They are also the ones who have the most trouble finding a new gig?

Being remarkable is something that can become engrained in everything you do, but it helps if you’re living in a remarkable community.

“Cities do not become great because they are well-balanced.

Instead, they become “remarkable” because of their great imbalance.”

Seeking Maximum Imbalance

People travel to Paris to see the famed Eiffel Tower because it is the only one in the entire world. It was created by Gustave Eiffel, a rule-breaking visionary, whose bold lifestyle exemplified the term – remarkable.

Millions travel every year to Agra, India to see the Taj Mahal, or to Egypt to see the Great Pyramid of Giza, or to South Dakota to see Mount Rushmore, all because they are world famous attractions that only exist in one location on the entire planet.

If cities around the world all started building their own Eiffel Towers, it would quickly cease to be an attraction.

Similarly, those who want to work in the movie industry move to Hollywood because this is a community that eats, sleeps, and breaths movies. Likewise, much of the U.S. oil industry is based in Houston, high tech is based in Silicon Valley, and the financial industry is centered around New York City’s famous Wall Street.

Cities do not become great because they are well-balanced. Instead, they become “remarkable” because of their great imbalance.

It’s far easy for real estate developers to work with established companies – well-known brands in retail, fast growing companies for commercial buildings, and proven homebuilders for doing residential.

Reinforcing mechanisms of the status quo are everywhere. Planning and zoning commissions are more likely to approve plans, city councils are more likely to give a thumbs up, and banks are much more likely to lend money to developers working with well-known entities with a proven track record.

Most economic development departments seem to be working with the same checklist:

Best Buy – check
Benihana’s – check
Wal Mart – check
BMW dealership – check
Marriott Hotel – check
Macy’s – check
Starbucks – check
Hard Rock Café – check

However, a few communities are making bold decisions to stand out, and they stand out because they are greatly imbalanced in a positive way.

So what is it that will differentiate a great city today from a remarkable city in the future?

Building Remarkable Communities in the Future

All things novel and new eventually become old. However, there are systems and structures that lend themselves to creating a constant culture of innovation.

The most important is cutting edge infrastructure.

When the City of Lafayette, Louisiana finally won their 3 year, $3.5 million battle to run fiber to every home, the raised the bar for every other city in the U.S. Now with Google running fiber to every home in Kansas City, many are feeling left behind. And they should, because South Korea is light-years ahead of the U.S. when it comes to super high-speed Internet.

Dubai is currently working with France’s Eole Water company to developed a special wind turbine capable of extracting upwards of 1,000 liters of water a day directly from the air. This type of system would eliminate existing pumps, pipelines, and purification systems.

Las Vegas is currently being groomed to be the test site for the driverless car era. With laws already changed in the State of Nevada and Google in the background pushing driverless car agenda, we will soon see special pickup & drop-off stations for driverless taxis, special apps to signal these vehicles, and an entirely new communication structure for bypassing traffic, reporting problems, and improving the ride experience.

Remarkable cities in the future will be those that:

Solicit experimentation
Cultivate risk-takers
Encourage novelty
Nurture their innovators
Reward creativity
Incentivize startups, and
Promote their differences

Great communities are founded on great ideas. At the same time, our most admired communities become a magnet, attracting the brightest minds. The relational effect is clear: Bright minds make a community great, and great communities attract bright minds.

In the future, communities will be designed around ways to stimulate new ideas using such things as creative environments, imagination sparkers, and inspirational architecture.

They will also be designed around new ways for people to meet people. Future communities will be judged by their vibrancy, their interconnectedness, and their fluid structures for causing positive human collisions.

Finishing the Story about Stapleton Airport

Working within a City organization is much like being an employee with 10,000 bosses. But the Stapleton Redevelopment team had been organized very early on in the process and very few people knew it existed.

Part of the thinking was that if we could come up with a great plan for Stapleton, it would be far easier to sell the general public on moving the airport to the new location.

Being something of expert on novel attractions, my ideas started gaining attention.

At one point Mayor Fedrico Pena sent a letter to the IBM Boulder Plant Manager requesting me to serve as a “loaned executive” for the Stapleton Redevelopment Team. Even though IBM had an active executive-loan program, this particular request was turned down because they didn’t support economic development initiatives.

In spite of the rejection, I stayed involved. Our approach was to invite some of the nation’s most innovative companies into a glass walled conference room overlooking the Stapleton airfields and ask the simple question, “If the City were to offer you these 4,700 acres of prime real estate, what would you do with it?”

The reactions were varied.

Busch Gardens expressed a strong interest, but had just taken over all of the Sea World Parks and said it would be another year before they could get their minds around tackling something new.

Disney was contacted and quickly thumbed their nose at the offer, saying the 4,700 acre site was simply “too small” for them to consider.

At one point I even contacted Theodore Geisel, better known as Dr. Seuss, to see if he would be interested. His only response was an autographed photo of himself and a short note wishing us “best of luck on our project.”

The most awkward meeting was with George Lucas’s team from his company, Industrial Light and Magic. Contrary to what we had been led to believe, ILM was strictly a contract for hire organization and the people who sat in on the meeting had no capacity to envision a project that operated outside the bounds of this arrangement.

During this whole time, our most interesting conversations were with Joe Calimari, Executive Vice President of Marvel Comics. At the time, Marvel was busy licensing its characters and was having a few major successes, but was primarily a comic book company based in New York City.

Pena himself wanted to turn part of Stapleton into a Western branch of the Smithsonian, with an Air & Space Museum unlike any other in the world. The idea had great potential.

The Mayor’s team had found out about a Smithsonian archive of over 300 famous aircraft sitting on mothballs waiting for someone to figure out what to do with them. Since Stapleton was already an airport, it seemed like a perfect fit. Once the main airport operations moved to the new site, Stapleton could retain a single runway to fly in historic aircraft for display purposes.

But that never happened. In the end, the Smithsonian Board couldn’t conceive of any of their facilities being outside of the Washington DC area.

We only had a short window of opportunity to develop something spectacular for the Stapleton site, and once the Smithsonian Air Museum was voted down and DIA became a viable option, the Stapleton Redevelopment Team found itself operating much like many other City organizations with 10,000 bosses.

So instead of capitalizing on this amazing opportunity, the City decided to play it safe by turning the site into countless acres of retail and housing. An unremarkable ending to a truly remarkable opportunity.

Our current political processes have a way of beating the visionary out of its lone visionaries, and this was a perfect example.

Final Thoughts

With transportation becoming easier, making us a more mobile society, and with smart phones and the Internet speeding up communications, our cities are becoming a far more fluid environment.

Much like water that flows downhill seeking the path of least resistance, businesses have a tendency to move from areas they find less appealing to ones that are more alluring.

Like a moth drawn to a light, it’s just human nature to be drawn to places that respect our time, needs, and status.

For each of us we set our minimum lifestyle requirements, and once those have been met, we look for other attributes such as convenience, friendliness, and speed. When we hear words like “complicated,” “arduous,” or “painful” we tend to run the other direction.

We spend our time, our attention, and our money where it is most respected, and the remarkable communities of the future will not only embrace these principles, but figure out systems to amplify their appeal.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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Four Key Trends Driving the Future of Patents

In July, David Kappos, Director of the U.S. Patent and Trademark Office, announced expansion plans for the USPTO that would involve opening satellite offices in Denver, Dallas, and San Francisco. These coupled with the previously announced office in Detroit would draw on a diverse new talent pool for future examiners.

Last year’s “America Invents Act” that was signed into law in September 2011 has paved the way for a dramatically different intellectual property system to emerge.

Perhaps the biggest change is that the organization now has control over its own budget, a key factor driving the expansion process. Just in the past year the patent backlog has been reduced from over 700,000 to 640,000.

With plans to expand each of the satellite offices to 1,000 employees over time, the USPTO plans to whittle away this enormous patent logjam and create a response time that’s far better aligned with the industries it’s designed to support.

So how will businesses react if patents are granted in 3 months instead of what currently takes over 3 years? And what will it look like if patents are as easy to license as music and photographs.

Here are four key trends that will drive the world of intellectual property over the coming years.

History of Patents

Before the patent, trademark, and copyright systems were created, all intellectual property was a trade secret. As a result, businesses were enormously tight-lipped about anything that gave them a competitive edge.

In fact, many of these valuable trade secrets died along with the founders of the company because they had no good way for passing this information from one generation to the next.

When Thomas Jefferson came along, he wanted to create a system that encouraged innovation, and the original patent system was designed to give inventors a protected period of time to make money off their inventions in exchange for making the information public.

The first Patent Act in the U.S. was passed on April 10, 1790 and the first three members of the newly established Patent Commission were Secretary of State Thomas Jefferson, Secretary of War Henry Knox, and Attorney General Edmund Randolph.

The first patent was granted four months later in July 1790 to Samuel Hopkins of Philadelphia for a method of producing potash, a critical ingredient used in making soap, glass, and gunpowder.

Even though other patent systems predated it, and over 160 intellectual property systems are now in place around the world, the U.S. system has emerged as the preeminent one for filing patents.

According to 2010 statistics from the World Intellectual Property Organization (WIPO) there are roughly 2 million patents applied for each year around the world and the U.S. filings account for roughly 25% or 500,000 of that total.

China is moving up quickly with approximately 400,000 filings annually and is set to surpass the U.S. very soon.

Over half of the U.S. filings are from people in other countries, but in China, only 25% come from abroad.

Using these statistics to set the stage, here are four key trends I see happening over the coming years.

1.) Competing Systems

After gaining a reputation for being the Wild West of product rip-offs, China has been working hard to legitimize both their reputation and standing in the intellectual property arena. They want to assure businesses that its safe to have their products manufactured in China, and that their court system is a fair forum for handling disputes.

Clearly their efforts have been paying off as total patent filings in China have mushroomed from 51,906 in 2000 to 391,177 in 2010.

During that same time, U.S. patent filings have grown from 295,895 in 2000 to 490,226 in 2010.

Part and parcel to the appeal of the U.S. patent system has been the fact that the U.S. has the world’s largest economy. With China’s economy growing rapidly, that could also change very soon.

Working inside the mammoth USPTO infrastructure, David Kappos and his team are working to reinvent the patent system itself. While they still have a ways to go, they’ve been making major strides with last year’s “America Invents Act.”

So does a better system trump the allure of a bigger economy? That is something we’re about to find out. Here are a few unusual variables that could make all the difference.

2.) Speed Sells

If patents were issued in 3 month instead of the current 3.5 years, how would that affect business thinking?

Many large corporations actually prefer a slower patent process because it extends the value of the patent over time. Since most licensing activity occurs in the last 25%-50% of a patent’s lifecycle, with its value often escalating towards the final years of protection, it becomes highly beneficial to have the protection period pushed as far into the future as possible.

But for a patent that is instantly licensable, inventors prefer the shortest possible time for issuance.

So if the average wait time for patents were reduced to 3 months, it would dramatically shift business strategies.

In fast moving industries like high tech, biotech, and nanotech, businesses will very likely file far more patents. Startup companies wanting to improve their value in the eyes of investors will also file far more patents.

In virtually every scenario, the overall number of patent filings ratchets up quickly when the wait-time is reduced.

3.) Standardized Licensing

Everyone who downloads a new piece of software receives a user license. Downloading music, TV shows, and movies, customers receive a specific license that defines how and when they can use the products.

Even for businesses, licensing music, photos, or art is a relatively standardized process.

But when it comes to licensing a patent, we currently have no standardized ways for making that kind of transaction.

When someone receives a patent, it does not give him or her the right to practice their own invention. Rather, patents only give inventors the right to exclude others. For this reason, many patents are used more as a tool of denial to prevent competitors from infringing on their profit margins.

While virtually all musicians want to license their music, that is not true for businesses who are leveraging their patents for the benefit of one specific company.

However, that could soon change as licensing organizations gain enough clout to start imposing standards on an industry that, until now, has worked aggressively to oppose them. More on this below in the Patent Troll Scenario.

4.) Patent Troll Scenario

For an inventor, a patent is only as valuable as their willingness to enforce it. This gives large corporations with deep pockets a distinct advantage, but their deep pockets also make them a more likely target for those claiming intellectual property violations.

Over the past couple decades a new breed of holding company has materialized that buys up existing patents and use a variety of legal strategies to enforce the rights of their patent portfolio.

These holding companies have been given the pejorative industry moniker of Patent Trolls.

While most people see little value in companies that don’t produce a product, and only siphons money from those who do, they may indeed play a bigger role, with a more noble purpose, in the future.

Scenario: An ingenious new kind of patent holding company is created that offers both to license patents and provide legal protection for the patent holders.

Their business model is based on two key provisions. The first is a standardized process for licensing patents and the second is a legal protection service that inventors pay a small monthly fee for (under $100 per month).

Small companies and individual inventors will be attracted to this type of offering because it increases the potential for securing a licensing agreement and, at the same time, provides a form of legal insurance that can be brought into play whenever something goes wrong such as patent infringement or flagrant knockoffs.

Over the next 5-10 years these holding companies extend their reach to the point where the larger ones represent upwards of 100,000 patents. At this point they will have a huge amount of clout and influence in the industry, rivaling even the largest corporations.

Is this a realistic scenario? Will it be beneficial for some of the existing holding companies to morph into this type of business model? What will the long-term effect of this shift have on the future of intellectual property?

Final Thoughts

A few years ago I was involved in a conversation with some patent attorneys over the question of whether someone could patent a smell. The conclusion they reached was “yes,” as long as there was some system in place for defining and measuring smells.

As with other areas of business and industry, our systems have to morph and change to match the realities of today’s world.

The primary charter of an intellectual property system is to promote innovation. As soon as it becomes more of a deterrent that an enabling force, changes need to be made.

As a society, we are blinded by what we see and cannot imagine the opportunities that are yet to materialize. When we ask the question, “What’s missing?” we are left with only vague assumptions about what might be a good fit for the white spaces surrounding the world we live in.

Intellectual property is all about the people who are good at visualizing all of the things that will fit into those empty gaps.

These are the people who are creating our future. Some are crazy misfits, rebels, and troublemakers.

They live a life of passion and dreams, driven by a desire to make our world a better place. In tough economic times, inventors bring hope and inspiration to everyone they touch and have the potential to bring exciting new jobs to a world that desperately needs them.

To me they are my heroes, and we need to create systems that continue to inspire and enable the crazy part in all of us.

NOTE: On October 13th, the DaVinci Institute will be hosting the 8th annual DaVinci Inventor Showcase at the Denver Merchandise Mart. It will be an amazing day for all who attend.

I hope to see you there.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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False Wisdom of Crowds

If you had a choice of flying from Boston to San Diego in a plane piloted by a single machine or the combined intelligence of 3,000 people, which would you choose?

Perhaps you would want more information before making that decision.

If the machine piloting the aircraft was a well-designed piece of equipment that had been used as an autopilot for thousands of successful flights, and the 3,000 people were of average intelligence living in the Midwest, which would you choose?

What if the 3,000 people consisted of the combined intelligence of the best airline pilots in the aviation industry?

When working with large groups of people online, the wisdom of crowds is neither elevated to the smartest among them, nor is it diminished to the lowest levels. It hoovers somewhere in the middle.

But the cumulative influence of crowds, in today’s society, is very influential. And there is a pervasive notion that the crowd is always right. But what happens when it is wrong?

A History of Wrong-Headed Crowds

Leading up to 1929, it was a well-known fact that stocks were a great place to put your money.

In the 1950s, it became common knowledge that if a nuclear bomb went off in your city that you’d be safe if you simply learned to “duck and cover.”

In the 1970s, because of all the TV shows, virtually everyone knew about “quick sand” and how dangerous it was.

Up until 2007, it was a well-known fact that real estate was a great investment where you would virtually never lose money.

Today’s movies give most young people the idea that anyone can jump from a car going 30 mph, roll a few times, and be fine.

So much for the wisdom of crowds.

Drew Curtis, founder of Fark.com, has a very low regard for group intelligence.

“The ‘wisdom of the crowds’ is the most ridiculous statement I’ve heard in my life. Crowds are dumb,” Curtis says. “It takes people to move crowds in the right direction, crowds by themselves just stand around and mutter.”

Curtis points to his own experience moderating comments on Fark, where users present a rather humorous take on the news of the day. He says, “Only one percent of Web comments have any value and the rest are just garbage.”

Leveraging the Thinking of Crowds

When Congress wants to study an issue, they don’t bring in average people to testify. They only want the experts.

On the other end of the spectrum, it really doesn’t work to poll people on their thoughts about winning lotto numbers to find the winning combination.

However, polling crowds can be a very good tactic for determining a product’s success if the crowd is closely aligned with that product’s target market.

While people are very good at knowing what they personally want, they are generally very bad at understanding the truths of the world around us.

A study last year by ETH Zürich found social influence is a huge factor that can greatly undermine the “wisdom of crowds.”

They found that influential people have a way of narrowing the diversity of opinions to the point where it undermines the wisdom of crowd effect in three specific ways:

“Social influence” diminishes the range of opinions.
This “range reduction effect” tends to polarize people’s opinions making group feedback less reliable in guiding decision-makers.
Influencers tend to improve people’s confidence, but this so-called “confidence effect” will boost an individual’s confidence, while at the same time, decrease their accuracy.

Next Generation Super-Influencers

The Internet has made it far easier to gather information about people’s tendencies, inclinations, and opinions.

It has also made it far easier for super-influencers to polarize people’s judgement.

The whole democratic process in the U.S. today has really evolved into more of a battle of the super-influencers than the traditional gamesmanship by the candidates themselves. As a result we are seeing an increasingly polarized electorate.

Even though an elite group of super-influencers can be leveraged in the wrong way, marketing people are quick to get these same super-influencers to endorse their products and services in a more positive fashion.

Big Data’s New Wave of Decision-Making

In the past we have had the luxury of being able to take time making a decision.

Decision-making groups like planning boards, town councils, or some other overseer of a process, generally meet on a liesurely basis. Big decisions are often slices into multiple smaller decisions and handled over longer periods of time. This time honored system for making decisions allows the general public to give their input and recommend changes along the way. In general, a fair way of doing business, but also a slow way of getting things done.

This slow determanistic model is being replaced with data mining techniques that can access the opinions of large constituencies or the buying whims of a target market almost instantly.

The speed of decision-making has become a competitive advantage in the business world and the latest form of bragging rights when it comes to communities. Yestersay’s taildraggingly slow processes are being replaced with an entirely new social norm.

According to a recent study by Capgemini, big data is becoming as fundamental to business as land, labor and capital.

“It’s not only through harnessing the many new sources of data that organisations can obtain competitive advantage. It’s the ability to quickly and efficiently analyze that data to optimize processes and decision making in real time, that adds the greatest value,” says Capgemini Global Sales Director Paul Nannetti. “In this way, genuinely data-driven companies are able to monitor customer behaviors and market conditions with greater certainty, and react with speed and effectiveness to differentiate from competition.”

Capturing Real “Human” Intelligence

A few years ago I was involved in a search engine research project where we looked closely at the connecting strategy people used to analyse the relationship between a search phrase and the resulting website that they were eventually looking for.

Once users typed in a search phrase, we studied how the discernment process unfolded, with inappropriate sites being discarded before a final destination was chosen. Over time it became clear that the search path itself was layered with huge amounts of valuable data that should be captured and dissected for later use.

The information fragments that we were capturing were not merely data points along a line; we were capturing actual pieces of real human intelligence. Since real people were making the link between the search terms and the destination site, albeit a primitive association, it was indeed a useful nugget of human thinking.

Over time, artificial intelligence will give way to far more useful forms of real human intelligence.

Perhaps a better way to explain the capturing of real human intelligence is to explain my vision for the music player of the future. Since music is a very integral part of our lives, we can all relate to the power of listening to the right song at just the right time. But, for each of us, that perfect “right song” is always different.

So let’s imagine a music player that only played the “right songs”. One great song followed by another.

The ultimate music player will be capable of doing exactly this. It will assess our mood, our likes and dislikes, understand the contextual attributes of time, place, and people, decide whether we’re doing something that requires us to be physically active or just sitting comfortably in a chair, and it will anticipate our response to the music before it is ever played.

The ultimate music player will measure our heartbeat, brainwaves, biorhythms, stress levels, circadian rhythms, and a few other sensory inputs we haven’t even invented yet.

This future music player will only serve up songs that our body has a positive response to.

Technology like this will elevate our minds, and mental clarity, to a whole new level. It will be simultaneously energizing and relaxing, and give us motivation, endurance, and determination. In short, it will give us a reason to bound out of bed every morning to tackle a shining new day.

A device like this will require capturing real intelligence in real time.

As we move into the big data era, we will continue to uncover far more sophisticated ways of both capturing and leveraging these gems of real human intelligence, and finding unusual ways of using only those with the highest grade of intelligence behind them.

Final Thoughts

Today’s so-called “wisdom of crowds” will be replaced by three driving forces:

Next Generation Super-Influencers
Big Data’s New Wave Decision-Making
Real Human Intelligence

While it will still be important to keep people engaged in a participatory fashion, the value of these three forces will quickly supercede the complexity of crowds.

When it comes to big data, IBM estimates that 2.5 quintillion bytes of data are created every day. Using this metric means that 90% of all the data in the world today has been created in the last two years.

Out of big data will come big strategy which will begin with effectively framing the problem.

A recent study by McKinsey and Company calculated an immediate shortage in the U.S. of 140,000-190,000 people with analytical expertise and 1.5 million managers and analysts with the skills to understand and make decisions based on the analysis.

The biggest gap is the lack of geek-savvy managers capable of making good decisions in this type of environment.

Over the coming months, the people-friendly “wisdom of crowds” is about to be railroaded by the oncoming big data train. To many it was a passing fad, to others, it never stood a chance.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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The Threat of a Jobless World

People are seriously worried. I’ve been in a number of conversations recently where people are very worried about our coming era of automation where fewer and fewer jobs will be left for people to do.

A few months ago I predicted that over 2 billion jobs will disappear by 2030. With technologies like driverless cars, robotic assembly lines, and teacherless schools on the horizon, the handwriting is on the wall and people are getting nervous.

At the same time, our best thinkers don’t seem to have good answers for what comes next. Our best colleges are training students for jobs that will no longer exist. Our business leaders are myopically focused on what’s best for them. They have an obligation to hire the fewest number of people they can get away with, and to trim staff and expenses wherever possible. And politicians don’t know what to think because there are no lobbyists for the future unemployed.

In the past, the vast majority of our layoffs were caused by economic downturns. As we move into the future, the tide will shift, and the majority of our layoffs will be caused by automation and technology.

With all the chaos and uncertainty of a workerless world looming, I’d like to step you through some of the reasons why it will not be as bad as the doomsayers are predicting.

Automation still requires some human interaction.

Our Human-Based World

Let me first reiterate this key point. In the past, the vast majority of our layoffs were caused by economic downturns. As we move into the future, the tide will shift, and the majority of our layoffs will be caused by automation and technology.

This is an important factor to understand because as this happens, our social structures will begin to operate with a different set of rules.

We still live in a human-based world. People create our economy. Without people there is no market for goods, no market for raw materials, no market for energy, communications, or medical services. Without people there is no economy.

If you can imagine a world with only one person, there is no economy because there is no one to trade with. In a world with two people, there is a very limited economy resulting from the trading back and forth between the two.

So is the economy in a world with 100 people 50 times more than the world of 2? Actually it’s exponentially greater because of all the options for trading back and forth.

Theoretically, a world with 9 billion people in it will be far greater than one with 6 billion. The Internet is dramatically improving our trade channels, and as a result, improving our economies.

The Three Laws of Automation Parity

As we think about the growing number of machines in our lives, we need to consider how our relationship with them will morph and change.

Machines that are too intrusive, too demanding, or too annoying will never be accepted.

Machines need people more than we need them. A machine without users is like a Transformers movie without an audience.

People can live without machines, but machines cannot live without people.

Yes, there are many scary sci-fi movies where the machines somehow gain magical human-like qualities and start killing humans. But in the real world, where we already have so many problems that we don’t have to fabricate new ones, machines are still very much dependent upon humans.

The automations that we see eliminating jobs today, are all being developed “by humans for humans.” Their primary purpose is for personal gain.

Automation, in many cases, will replace money as the tool of choice for our power elite.

In much the same way that people use weapons to destroy other people, automation and machines in the wrong hands can be a very destructive force.

It’s easy to start viewing automation as a silent killer, much like an Ebola virus for jobs. But in the end, there are always humans directing the effort, and humans benefiting from the destruction.

Once we cut through the slight-of-hand misdirects, we begin to see the real wizard behind the curtain.

Knowing that it’s nothing more than a human vs. human game, we can begin to see the limitations of our own actions. For this reason I’ve created the “Three Laws of Automation Parity” to help guide our thinking about this future threat.

NOTE: Since this is my first discussion on this topic, I’m very likely missing key points. I would invite you to let me know where I’m off base and add to this conversation below.

1.) The Law of Human-Automation Equilibrium

As we move into a future dominated by automation and technology, it’s important to understand that people still drive the economy. If people become unemployed and lose their income, they also lose their purchasing power. And when large numbers of consumers lose their ability to consume, the whole economy suffers.

What’s bad for the economy is also bad for the controllers of automation.

Whenever the proper balance between humans and automation drifts too far into the automation camp, an economic backlash will occur.

Automation is a tool of the power elite, and the number of people who are controlled by it is a key ingredient of the power formula.

As an example, people who control the cellphone industry are far more powerful if a billion people are using their devices, than if only a million are. Consequently, when people can no longer afford their phones, or don’t like the devices, it directly affects their sense of power.

Yes, certain people are willing to win at any cost. For them, the carnage and destruction that follows is easily dismissed with comments like “I can’t help it if they were too stupid to hang on to their job.”

However, even the most ruthless have empathetic family members. And one of their greatest fears is often having people despise them after they’re dead. Their legacy is hugely important, and even though they want desperately to win, they want to leave on a positive note.

2.) The Law of Diminishing Returns

Humans are still capable of making a wide range of complicated decisions on an ongoing basis. Even though we are able to automate down to a certain level, it becomes prohibitively complex and expensive to automate past a certain level.

The simple task of cleaning involves tens of thousands of nuanced decisions to formulate an appropriate response. As an example, walking in to clean your grandparent’s attic, every object has an emotional value that is used by you to sort, organize, and discard the objects in front of you.

The complexity of this type of decision-making is not easily transmitted to an emotionless machine. Even if this technology could be developed, it would likely not be used because it interferes with a critical component of our humanity.

Another important example is in the field of healthcare. Human to human touch is not easily replicated. We like being around others, and when someone is hurt or injured, the need for human interaction increases

Yes, we will automate many aspects of the field of healthcare. But we will find it prohibitively expensive and complex to automate past a certain point.

The Law of Diminishing Returns is the barrier we, as humans, will naturally resist crossing for reasons we can’t always explain.

3.) The Law of Overestimating Capabilities

Seven years after the Wright Brother’s inaugural flight in 1903, Waldo Waterman built the first flying car. It was a logical extension of the airplane and people could instantly see the efficiencies that could be gained with a flying car. Now, 102 years later, we have little more than museum pieces to show for our flying car efforts.

In 1947 Dennis Gabor invented holography, a technology that he would later receive the Nobel Prize for in 1971. We are now celebrating the 65th anniversary of a technology that never materialized in the way he imagined it.

In 1950, computer visionary Alan Turing imagined a world where computers could think and respond like humans. Now, 62 years later, we have yet to pass his infamous “Turing Test.”

According to Amara’s Law, “We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.” And the long run is often times very very long.

It’s easy for us to see a new technology in a movie and extrapolate the speed of adoption and the impact it will have. But one of our biggest mistakes is over simplifying the process for getting there.

Final Thoughts

Every problem creates an opportunity and as the numbers of unemployed rise, this too becomes another entrepreneurial opportunity.

We are entering an unprecedented era where all of the rules are about to change. We won’t be able to trust our instincts or many of the things we’ve traditionally been able to count on.

Economists will all be scratching their collective heads wondering why our economy is acting so weird. But then again, they scratch their heads when everything is normal and wonder why our economy is acting so normal.

Over the coming decades we will indeed see many jobs go away, and it will be up to up to devise better systems for rapid job creation.

Sometimes it takes reaching a higher pain threshold before we are willing to make the changes necessary. Look for many of these pain thresholds to peak in the near future as we dip our toes in our next era for humanity. That’s when things will get very interesting.

By Futurist Thomas Frey

Author of “Communicating with the Future” – the book that changes everything

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