What happened in 2016 that nobody noticed

By Eric Newcomer

Photographer: Wyne Veen for Bloomberg Pursuits Magazine

I’m on a flight home to Macon, Georgia, reading Hillbilly Elegy like much of the rest of Silicon Valley. I’m trying to figure out how I misread the American electorate so fundamentally. I still don’t have the answer, but my early verdict is, it’s worth a read.

Given that one of the biggest news events of the year, the election of Donald Trump, took most of us by surprise, I thought it made sense to look back at 2016 and consider what else we might have missed. I asked a bunch of technology investors and entrepreneurs a simple question:

What happened in 2016 that nobody noticed?

Here are their answers:

Mark Cuban, investor: “Machine learning, all its derivatives and the chips that drive the speed that enabled them became the hottest transformative technology in years. There is no greater focus among tech companies and the price performance race among chip makers will rival and probably exceed the non-stop Moore’s law races of the 80s and 90s.”

Stephen Pratt, chief executive officer of Noodle.ai: “NVIDIA’s announcement of the DGX-1 Supercomputer, selling for about $120,000. Its ridiculous price-performance ratio will unleash a wave of artificial intelligence programs that Fortune 500 companies will use to out-maneuver, out-perform, and crush each other. In April of 2016, the seeds for acceleration of this carnage were sown.”

Rob Hayes, partner at First Round Capital and an early investor in Uber: “The battle for the last mile of delivery is on, and there are a dozen startups and just as many established companies trying to make it easier, faster, and cheaper to get a package from a distribution center to your doorstep with technology, not just people and vehicles. What this means is that consumers will order even more online, the ‘store’ is always on the corner, and an Amazon Prime membership had better be a lot more than 2-day delivery if it is going to hold any value for customers.”

Brian Armstrong, CEO of bitcoin startup Coinbase: “Digital currencies now have a higher market cap than the GDP of 70 countries. Source 1: Digital currency market cap $14.9B, 21 Dec 2016. Source 2: Countries 116 to 191 GDP below $14.87B, IMF 2016 estimates.”

Sam Britton, head of technology M&A at Goldman Sachs: “Tech M&A deals’ success rate has increased. The OpenTable writedown by Priceline was a visible exception to the rule and a reminder that after 2 years of the busiest environment since 2000, you haven’t seen as many high profile failed deals.”

Rebecca Kaden, general partner, Maveron: “2016 was the year the internet quietly sped up — while the ease of online video is now a given, broadband speeds made a record jump step that will make possible the next post-video wave of high consumption media. For the first time, download speeds improved 42% and crossed 50 Mbps, making it 1,000 times faster than dial up (and twice as fast as Netflix recommends to stream ultra HD quality video.) So while we may not need or notice this advancement now, it opens up possibilities for new media consumption that were previously impossible.”

Bradley Tusk, founder of Tusk Ventures and former mayoral campaign manager for Michael Bloomberg: “The worm began to turn on politics and tech.

Tech executives began to both realize that they can’t just ignore regulatory and political issues and that not all politicians and regulators are inherently stupid, lazy and corrupt.

Politicians and regulators began to realize that just doing the bidding of the entrenched interests will get them beat over the head. This is the first step towards both sides attempting to genuinely understand each other’s perspectives and have less confrontation going forward.”

Vas Natarajan, partner at Accel: “I wonder if we’ll look back at 2016 as the year Microsoft laid the tracks for a huge victory in the cloud wars. There’s a major flank happening here in bits and pieces — and many of those pieces began to fit together this year:

  1. Office 365 becoming the de facto cloud productivity package for enterprise workers;
  2. The acquisition of LinkedIn as a foundational data asset for a pending assault in sales and marketing SaaS;
  3. Azure becoming a credible, cost effective IaaS/developer platform with meaningful enterprise sales/support/solutions;
  4. MSFT’s accelerating support of open platforms & open source;
  5. Continued investment in the oft-dismissed .NET developer crowd with their Xamarin purchase; and
  6. Fervent, organizational-wide support of Satya and his vision for serving a mobile, cloud, data-enabled world. This doesn’t even consider the massive incumbency advantages MSFT already has given their years of selling to the enterprise.”

For next week, I’m collecting “specific, falsifiable and telling predictions about 2017.” E-mail me (enewcomer@bloomberg.net) a short prediction that fits the bill, and I’ll consider including it.

Until then, make sure to read Brad Stone’s year-end wrap up on Silicon Valley’s political responsibility. I think it’s a hugely important topic. Have a nice Festivus or whatever you celebrate. Disconnect for a bit. Delete Twitter for the week. Take a walk. Contemplate.

This originally appeared in Bloomberg Technology’s newsletter Fully Charged. Sign up here.