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Monday, December 26, 2011

Disruptive Technology

Welcome to the future

Its t's are crossed and i's are dotted with disruptive technology. And so, by the way, goes our past. In the 16th century, the Spanish conquered the indigenous mesoamerican civilizations by using the technological innovations of horses, trained dogs, gunpowder, and particularly steel. This led to bloodshed and subjugation. In other words, the disruption of an entire set of civilizations.

Fortunately, today, disruptive technology is a bit more gentle. We can see its force in lots of places.

Brick and Mortar

One example is online shopping. This is leading to increased availability of goods, and also it is leading to the demise of many brick and mortar stores. Online shopping, along with the prevalence of the superstore (WalMart, Target, Home Depot, Best Buy, Costco, etc.) is accelerating the disappearance of the mom-and-pop shops of yesterday. Amazon has a new thing called Price Check that may do much to kill off brick-and-mortar altogether.

OK, it's really only a trend. But there are markets that have been changed forever (or are on their way to being so). Let's look at a few.

Bank Branches

Consider bank branches. With automatic deposit, the prevalence of ATMs, and banking on your iDevice, who needs 'em? Perhaps banks will phase out paper checks. Paper checks are almost unheard of in Sweden, I have heard.

Record Stores, Video Stores

Now we look at some kinds of stores that have really been killed off by disruptive technology. Consider the record store. Record stores were just filled with disrupted technologies. I used to go to Tower Records over in Campbell quite often. First to get records. Then when records were disrupted by CDs, I went to get CDs. I remember getting VHS tapes there for hit movies. Then I remember that it was more DVDs that I was shopping for, because the DVD disrupted the VHS market. Eventually I stopped going to that store completely. Because of iTunes. Oh, and Netflix. Also, many people get their movies from on demand systems that are built into the cable providers. These technologies are disrupting entertainment media. Furthermore, this change is leading to the unbundling of packaged media.

Bookstores

Now consider two more venues for another commodity: books. Bookstores were partly eaten up by online sellers, like Amazon, and partly by superstores like Barnes and Noble and Borders. But they are poised to be defeated by online book delivery. The Amazon Kindle and the Apple iPad are two devices leading this charge. Right now, the bookstore is on its way to extinction, like the record store.

Libraries

The second venue that is also on its way to extinction is the library. This one is the most troubling because of the issue that most books are not yet digitized. Google is having significant issues in doing just that. But if they succeed, the library is all but dead.

What could replace the library? A banks of servers containing all the printed information in existence, that's what. Stored redundantly. And, hopefully in some format that is as close to permanence as possible. Books, by the way are far from permanent. For instance, about 25 percent of the 14 million books at the Library of Congress are presently too brittle for normal use. We are going to need these information banks soon, folks.

Newsstands

Magazines are the next form of printed or manufactured media to be replaced by its downloadable cousin. As smartphones and tablets become more prevalent, so will the consumption of media through these devices. Some are predicting the death of printed media. And I haven't bought a newspaper in years. When Google News will do just as well, why would I?

Gadgets

Now let's look at gadgets. The smartphone is replacing a whole host of gadgets and thus disrupting all sorts of markets.

PNDs

Personal Navigation Device sales have been on the decline. For instance, an iPhone contains a GPS receiver, which seems to be displacing a whole bunch of hand-held GPS units. The TomTom, Garmin, and Magellan devices have all seeing lower sales since 2009. They are now starting to make apps for the smartphone market. Disruption.

MP3 Players

Smartphones, particularly the iPhone, have MP3-playing capability built in. So, why would you need an iPod if you had an iPhone? Well, it seems that the cannibalization hasn't become too bad yet, but we do see a decline in iPod sales.

Portable Gaming Consoles

Here it seems that the number of people using iPhone and iPad as portable gaming devices is on the rise. This may be due to the inclusion of fast graphics processing unit (GPU) hardware, and also to the inclusion of MEMS 3-axis accelerometers and gyroscopes. The sales of portable game software and hardware consoles are definitely moving towards iOS. For Nintendo, they have said that $925 million was lost to iOS in six months alone. They expect cannibalization of that market to continue in 2012.

Cameras

The iPhone cameras have been getting better and better. And so, their customers are using them more and more as their camera of choice, their camera of convenience. Consider Flickr uploads. The iPhone 4 is the most popular camera for uploads on that site. With a smartphone, a point-and-shoot is a hard sell these days. But, of course, that's not true for real camera enthusiasts. Ongoing issues such as rolling shutter and image stabilization are still drawbacks for smartphone cameras. And, of course, mechanical features like optical zoom and aperture control.

PCs

Are we in the post-PC era? It appears that the ascension of the processor under Moore's Law is near an end. Now, it appears to be less about how fast the main CPU runs, and more simply what a computing device can do. Nonetheless, if it is too slow, then many would say that it simply cannot do it.

The configuration of the computing device is changing to accommodate the limits in the increase in computing power, and frankly to accommodate the tasks that people want to perform with the devices. Specialized processors for graphics (GPUs), image processing (ISPs), and digital baseband processors are placed on Systems on a Chip (SoCs) along with application processors, some of which are starting to have multiple cores. Additionally, audio and video codec hardware is usually present as well.

Many of these organization changes for computing devices are happening because of the relentless pace of improvements required for smartphones and tablets. But, what of the desktop PC? In 2008, laptop shipments first exceeded desktop PC shipments in the US. Now, in 2011, even laptop shipment growth is slowing, due to tablets and smartphones.

Mobile computing devices are explosively more popular and important than desktop computing devices. This is particularly so for Apple.

Rotating Disk Storage Media

I probably can't come up with all the storage media that were outmoded and disrupted by new technology, but three things are clear: portability, media size, and access times are critical factors in desirability. Hard disks have increasingly fulfilled those requirements for decades. Now, a new technology is destined to take over: flash memory. Flash memory is the main component of Solid State Disks (SSDs). This is the kind of memory that makes up the local storage for smartphones and tablets. And, for a few years now, it is also beginning to take over laptop storage and even desktop storage. I see disruption happening here. Probably hybrid hard disk/SSD drives will provide an interim solution just like hybrid internal combustion/electric vehicles are flourishing at the present. But I expect that power requirements and weight requirements will win out and hard disks will become fully disrupted over time.

Displays

Once upon a time, I used a storage scope as a display on a CAD system. But these were eventually replaced by raster CRT devices. And those were replaced by LCD screens of various kinds (with compact fluorescent, and now LED backlights). My opinion is that the technology which produces a crisp, accurate, bright, high-contrast color picture and uses the least amount of power will win. So display technology is becoming disrupted constantly. Power requirements are paramount for displays (called panels) because batteries have a limited amount of power in mobile devices such as tablets.




5 comments:

  1. I think this blog will be interesting to follow!

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  2. "Fortunately, today, disruptive technology is a bit more gentle."

    I saw some gory videos on what was happening in the Arab Spring, which is arguably brought on by technology disruptions as discussed in your Transparency blog.

    However, I get your point that disruptions tend to be less connected to physical issues and more to knowledge. I have a theory that the industrial age is dying (and along with it passive capital and the nation-state):

    http://www.coolpage.com/commentary/economic/shelby/Understand%20Everything%20Fundamentally.html#freedom

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  3. People have not become more gentle. The media can guarantee that things will be getting less gentle over time. I saw some of the videos you are probably mentioning and its sickening. Particularly in Syria.

    You are just *full* of theories, aren't you? ;-)

    Some of Bill Gates' ideas on education are interesting, but he really needs to ask the next question, I think. Things are changing fast.

    I wouldn't bet on Android, BTW.

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  4. I think you are aware from my other comments, that I think people have become less gentle (more arrogant and more excess resources to waste time with and do non-productive activities), because they've been fed free credit at an accelerating rate since the 1980 start of the global interest rate bubble, c.f. Transparency blog comments. I see media as a symptom, not a root cause, since they supply what the public demands. When the free credit bubble ends, there won't be the resources to survive and continue that non-productive behavior. Those who can't stop will perish. It is a natural filtering process. Of course, this is an issue of perspective, and you may view the causality matrix different.

    Afaics, one of the problems for teaching with videos w.r.t. the dynamics of refinement, is that video formats throw away too much information. I want to record the content at a very high level (e.g. recording pen strokes) so I can go back and edit it non-destructively. This is one of my early goals once I get a new language done, along with replacing HTML, and the entire web stack. hehehe, I can dream.

    One argument I have seen against Android is that patent fees will disrupt their model. Apple and Microsoft are accumulating many patents. As you know, I am fixated by global market share, versus profit share (which is heavily weighted by demographics), given I think demographics are going to be disrupted.

    Obviously you know about things you can't talk about, so you can't defend against an argument in public. So I understand.

    As I said, I am very interested to see what Apple pulls out of its sleeve next.

    It is exciting. I love that there are so many interesting things to work on.

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    Replies
    1. "more arrogant and more excess resources to waste time with and do non-productive activities"

      This could arguably used to describe me (too many theories, not enough recent quantifiable results), except that I don't own a house and my liquid net worth is not negative.

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