I have heard it said that there are now as many semiconductor chips on the planet as grains of rice. It is an arresting thought. And as I take my technical interests towards open source software, cloud and devops, I am breathing a whole new gulp of oxygen in what goes on in the state of the art. Take these guys for example.
There are several ideas behind the speculation I'm about to lay down. The first is based on this reality. The computer sector is outperforming the rest of the economy by leaps and bounds. It's not only doing well, it's doing very well. Somewhere over at TableauPublic, which I can't find and has been making me leave this draft in Park for too long, is a set of charts that show which companies have cash and which have debt. When you look at companies like General Electric it's downright scary. When you look at companies like Apple, they seem to do no wrong. Times change but what if the double dip comes and times get desperate?
Over the long term, there doesn't seem to be any end to the number of excellent and productive ideas that have always been basic to IT. And it gets easier to see them become reality. Back just 10 years ago, I couldn't even imagine today's future and I'm in the industry. Everyone was saying 'the last mile' could not be overcome - that is fiber to the home. Everyone was saying that video on demand was impossible. Now Netflix is bigger than Blockbuster. People were trying and failing. After the dot com bubble, nobody had any idea what to do. The idea the Amazon would do what it has done with EC2 was inconceivable by most of us. When Microsoft was forced to separate IE from Windows and allow other browsers in, they speculated that a company like Netscape would take market share by doing things just through the browser, but nobody dreamed that Google would become what it is. In the year 2000 only the geekiest of us had MP3s and the consensus was that nobody could break the hammerlock of DRM. Now Apple runs a DRM free universe of music on demand. Moore's law has ten more years, at least. That means that the iPhone 7 might have a terabyte on it.
All of those innovations are extra cool, but the fundamental economics of IT can still be expressed in very simple ways. The key term is 'disintermediation'. What will computer and communications tech allow people to do for themselves that they used to need third parties for? To jump the gun a bit, I will suggest banking, and when that happens ohh doctor!
First off, the fundamental thing that IT gives is the ability to overcome time and distance. It enables human intercommunications on levels never achieved in the history of mankind. In and of itself, this is an economy pulled out of a hat. Without disintermediating planes, trains and automobiles, there are new ways that people interact that make IT a non-zero sum game. Look at a movie from the 80s and find all of the plot holes and crazy situations that could have been obviated by today's cell phone networks and GPS.
Whenever I hear it said that reading and writing online saves a tree, I also know that it saves oil and electricity. What people tend to forget is that computing owes its very existence to the ability to engineer devices that sense very minute changes in electrical state. IT is energy efficient by definition.
What's happening to crowds these days is something very unusual. People have their own networks, and communicating with them and their paths makes an extraordinary difference in attention and focus. Many people may not quite know what to think about virtual friends, but the opportunity to have multiple online networks is a new social skill. Your telepresence will be a bigger status symbol than your car. The hardware and networks into your home will be more important than your lawn. For those of us in the business, that future is now.
Let me ask you. Do you remember the classified ads?
Newspapers and broadcast TV are being redefined. You might laugh about Hulu today, but people laughed at Tivo five years ago. If you think Apple TV is important now, wait until film is completely passe. What's happening on the edges of digital networks is critical. Devices like the Red camera system and the iPhone are changing everything. Given what I know about the infrastructure that is coming, YouTube and Facebook and eBay are just the beginning.
I think that in the not too distant future, much of banking is going turned on its head. If you think about banking as a collection of discrete trusted financial transactions, there are many classes of these things that can be disintermediated from the banks of today. It's already happening at Square. And look at what people are doing for themselves at Prosper.
Back in 1996, I was thinking about the cloud before it had such a name. In my conception, I couldn't imagine that people would trust ISPs to retain their digital assets. So I imagined that only banks would have the financial ability and trust. Now Google does it for free, and Backblaze does it for $50 a year. When you accumulate about 10TB of digital assets, you're going to have to trust people too, and they will be a different set of names. Let us not forget that when I started out in this business, corporate managers would not *think* of using computer systems to transact trusted financial matters. The idea of a manager approving an expense reimbursement without physically touching a receipt was unthinkable in 1990. Now think about Western Union, and money orders. That's a shrinking business.
In short, there are more and more ways the American economy is going digital, and there are fewer and fewer barriers. Young entrepreneurs are building software systems that disintermediate back office protocols. Every workflow in every business is being optimized by IT - it may be some time before you don't have to go to the DMV to renew your license, but I bet you a team of 10 people could build the system in six months.
White collar and intellective work is changing. Permanently. That is going to have a tremendous positive effect on the energy efficiency of the American economy. In education, in the professions, in business, finance, banking, insurance, medicine, law, publishing, music, film and all the visual arts.