The Things That Get Me Excited for the Future
The pace of growth in the realm of technology is undoubtedly at its fastest in human history. There are many areas where the world is changing fundamentally around us, but three jump out to me as trends that are massive on their own and even stronger when combined together.
Each is in a different phase of its maturity, though that doesn’t mean the opportunity ahead of them has neared its peak.
The Increased Certainty of Future Events
Risk is at the forefront of all economics, and specifically pricing. Retail, travel, entertainment, financial services, you name it, all follow the model that implied risk drives fluctuation in price.
Amazon is a perfect example of future certainty disrupting the retail space: with two decades of demand curves and a few hundred million customers each month, they are able to predict how much to stock their shelves with what consumers actually want. With inventory risk efficiently modeled, Amazon is able to charge low prices based on the understanding of supply and demand at scale. Who wins? The end consumer, suppliers, and the retail market as a whole.
You don’t need to be the world’s largest retail outlet to benefit from risk mitigation to pass benefits to consumers. The increase in the amount of data collection available through persistent Internet connections is unrivaled: 90% of the world’s data has been collected in the past two years alone.
Through this data, previously pooled buckets of risk can be personalized, providing meaningful pricing/discovery at an aggregated individual level. Some companies that are proving that this personalized risk modeling can drive meaningful change:
- Metromile: Pay per mile insurance. By collecting data on an individual level, a car insurance company can understand the risk you pose as an individual driver, rather than a cohort. Good drivers are no longer forced to pay for the bad juju of bad drivers, and bad drivers are effectively forced off of the road because they can’t afford to put their dangerous “skills” to work. Winner: the end consumer.
- Netflix: Might not seem obvious at first, but the beauty of the Netflix business model is that they believe that they can predict who will watch their original programming. Based on the success of House of Cards, Orange is the New Black, and various other originals, the strategy is arguably paying off. Reading the signals that a large cohort of subscribers like (e.g., political dramas written by Aaron Sorkin, Kevin Spacey in thriller roles, etc), Netflix can interpret what type of show will succeed and with exactly which viewers. The process isn’t infallible, but it significantly decreases the risk of flops. The result? A monthly subscription that costs < $10, less than a tenth of what a cable subscription runs you. Winner: the end consumer.
- Pandora: I’m biased on this one, but the past four years of working on this problem have had my head spinning. Through analyzing over 1 million tracks, collecting 1 billion data points per day, Pandora has created the first consumption product that generates over 20 hours of usage on average per user per month. Reading the signals of previous listening behavior, the entire curation team is below 25 people, compared to the thousands of radio programmers across the US alone. The result? Over $1 billion in royalties paid to the music industry, while keeping it free for the end listener. Winner: the end consumer.
There are plenty of other categories where the decrease in risk is driving the price to its maximum potential: travel (Duetto Research), restaurant management (Reserve), farming (Climate Corporation), and even sports (like the Warriors). You name it, there’s data behind it, waiting to be innovated upon.
Increased data collection leads to more signals, which lead to our ability to parse through them to better understand the landscape. We are able to predict future outcomes with great accuracy as we collect this data, however it is highly unlikely to consider that we will ever reach full certainty of predictions. More certainty, however, to make decisions can drive faster, more cost effective yields.
Current Inning of Innovation*: 5th inning. We’ve had machine learning prevalent for over a decade, but increased sensors and data are giving us a clearer picture of the world around us. New data paired with proper feedback opens the door for more accurate predictions of the future, hence driving down the cost of the unknown.
The First Global Human Civilization
The world’s largest country by population achieved its status in January of 2015. I’m not talking about China; I’m talking about Facebook. The proliferation of this network is hardly news to anyone, but the magnitude of its impact cannot be understated: we live in the first human society where anyone can be connected to another human anywhere in the planet at any moment in time.
When I first saw Facebook’s Live Map, it was a stark realization that we were finally unified as a singular human race. Never before could any human on the planet be connected to another who was willing to share the world at that moment through their eyes with near-zero latency. Periscope and Meerkat had tried, but the power of live came through this map. We all have the ability to be linked as humanity through sight, sound, and synchronous time.
A singular human civilization opens the door for new kinds of communities to form: communities of aesthetic, shared values, and aspiration are no longer bounded by physical geography. These connections are being driven by expressions of our self.
- VSCO: A community of tens of millions has formed to celebrate the aesthetic that most reflect who you are. The social connection doesn’t focus on who you are as an individual, but rather how you find beauty in the world.
- Medium: The power of voice becomes democratized through not only the communities we already are a part of, but also ones within which meaningful discussion and debate take place. People can form communities around ideas and shared beliefs, driving boundless inspiration and change.
- Snapchat: No big deal, just 10 billion moments are experienced in metaphysical space, connecting anyone to a brief moment in time that’s transpired in the past 24 hours.
This global community has only begun it’s path into connecting the world. Individuals craft their identity as a reflection of the communities they aspire to be associated with. As these communities continue to transcend borders, we stay connected with more people, a connection that increases with each new information technology (and thins our individual relationships).
Current Inning of Innovation: 3rd inning. Facebook just turned 12, the new communities emerging around shared ideas and identity are starting to hit a new stride as video distribution gets less expensive. Shared experiences in real time, or slightly delayed time, should pose new forms of human connectivity.
Intimacy with Machines (Increasingly Blurring Our Human Relationships)
The relationship we are forming with machines is rapidly moving toward a realm of quantum disassociation. More specifically: our brains have a tendency to attach value to objects we see/interact with through shortcuts that lead to an outcome. Example: when you drag an icon that represents a file into the trash bin icon on your desktop — are any of those things happening or is there a representation of that action taking place that leads to an understanding that the former collection of bits is no longer accessible.
Our disassociation with the world we see increasingly moves to this world: chat interfaces have enabled us to participate in the global civilization mentioned earlier. Companies like Slack and Facebook (across Messenger, What’s App, and Instagram DMs) have piled onto the human disassociation that SMS messaging has driven us toward. We increasingly interact with intermediaries for individual interaction, leading our brains to believe we’re connected with humans on the other side.
Getting that text message from your significant other, or that friend with whom you have not spoken in months, can release dopamine in our brains because it feels like an unexpected reward. Is it the person that we are responding to or the concept of the person?
The rise of bot fervor has been impossible to avoid, leading to a frenzy of developers everywhere. Why the recent surge? A combination of the past two trends: stronger data inputs generate stronger predictions, leading to a stronger fidelity of potential response — paired with a cognitive training that we increasingly rely on impersonal communication methods for our thin relationships.
The combination of these two trends have led to the question, Is it possible to love a bot? A recent post from How We Get to Next, not only asks the question, but goes as far as to say it’s inevitable.
Others, like my friend Michael Galpert, suggest that we shouldn’t necessarily love our bots, but rather have bots that make friends with other bots, both representing us in bot space. The argument being that our bot is a representation of who we are and we can teach it new skills to act on our behalf, effectively becoming our own meta friend.
Current Inning of Innovation: 1st inning. We have had bots and voice interactivity for decades, but their ability to create a meaningful connection with us on an emotional level has only come now.
The Confluence of These Trends
If we live in a world where we increasingly blur the line between human and machine through our disassociated interfaces, connected across geophysical limitations in real time, predicting the future… it’s inevitable that old constructs will come to an end and new ones will form.
We are starting to see this emerge with the renewed enthusiasm for virtual, mixed and augmented reality. If we can train our brains that the interactions that we’re taking place with these environments are real, how will that change the way we think about commerce, connectivity and nations?
In order to have any meaningful relationship, each party is required to have trust in one another. It’s increasingly less crazy to believe that we can trust a machine as we disassociate ourselves in communication vehicles with one another.
Each of these trends is powerful in its own right, but potential ramifications of these changes coming at once allow us to imagine a world beyond the nation-state: one where geo-political borders no longer connect (or divide) us, but rather communities of shared beliefs can co-exist with one another in a world that exists within our brains.
Unlikely? Yes. Impossible? That depends on your imagination.
*Current Inning of Innovation terminology uses a baseball metaphor; apologies if you’re not a sports fan. I like the idea of a baseball inning because while a baseball game typically ends at 9 innings, strong competition can enable games to go on indefinitely until a clear winner emerges.
