Saturday, March 27, 2010

As a species, we almost always over-estimate how fast things will change. But we always underestimate how much things will change. Thus….

My ten predictions before the world is slated to end in Dec. 2012....

·10) Eric Schmidt will no longer be CEO of Google. As giant media foes attempt to absorb excess profits in part derived on the backs of their content, things will get sticky. Eric will grow weary of the countless battles, stock price pressure, and growing discord in the senior ranks. One key factor? Bing. Why? Well, it’s like Pepsi, or Burger King. As Americans we are comfortable with virtual oligopolies, but not monopolies. We require an alternative to Coke and McDonalds. Yahoo by itself has failed at being that alternative. On the other hand, if there is one company that can challenge Google’s hegemony with pockets every bit as deep, it is Microsoft. Forget whether you think Bing is ‘better’ or ‘worse’ – irrelevant. It is a credible substitute, and it will be used by major media to try and squeeze Google’s profits. Which leads me to my next prediction….

·9) Paid search and natural search will become…. Search. We have grown comfortable in the knowledge that those slippery marketers are relegated to the internment camps of the paid section of search pages. But users really don’t care – what they want are good results – paid or not. The state-of-the-art today for paid results has them look and feel just like the real thing. Which they often are. In the near future, result hierarchy will be, in part, based on pay - but pay for performance - not just ranking. The gotchas leading to pay-walls and other poor user experiences will sink in the listings no matter the dollars thrown at them, in favor of a single search stream where dollars will play a role (but not the only role) in influencing rank. And this will happen in real-time!

·8) Steve Jobs and Apple will go one of two ways, and neither is great (but one is decidedly better than the other). In scenario 1, Jobs is permanently sidelined due to illness. To my memory, there has never existed a major corporation more personality-dependent than Apple (at least in modern times – I put him up there with Howard Hughes). Thus, within a very short period of time the brilliant, legendary, maniacal focus he possesses will be lost, and decisions that appear to be ‘better’ for the organization and its products will be made. These half-steps will be compromises designed to keep up with the world while preserving Steve’s ‘legacy’. This will not go well.

Scenario two – and in my mind also problematic for Apple -- Steve Jobs sticks around but doesn't 'think different'. In this case, we run the risk of a 2.0 version of the capitulation that was Apple 1.0 failing to discern the tea leaves and license its software to other platforms. We are beginning to see this play out now. In fact, Android exists because Apple was unwilling to work out a deal with Google. Jobs’ personal demons may not be suited to an alternative path. Android has already begun to eat the world. History may not repeat, but it usually rhymes. Hence, my next prediction…

·7) Android will have 3x the number of applications in its app store than the iPhone / iPad / iTouch triumvirate does. Not too long ago, there existed a thriving packaged-software industry, and a trip to Computerland circa 1984 would have revealed shelf after shelf of Apple-ready software, along with a smaller section of IBM & compatible boxes amidst strange Charlie Chaplin posters. How long did it take the era’s ISV’s to swap over to Wintel? Not long. I know not a single example of a company with an iPhone app today that hasn’t either a) already ported, b) is about to port, or c) is planning on porting their application to Android. With Apple, the hardware is better. The vision is better. The usability is better. And it is a closed (curated is the current term of art, though iTunes is far more than just curated) system in a world that prefers open.

·6) Major media companies will erect pay-walls & windows where they can, attempting to suppress the notion that everything wants to be free on the internet. Actually, we are multi-generation-conditioned to pay for stuff (one way or another) on every medium ever invented. Will the efforts to erect a pay-wall at the NY Times go over well? No. Will it eventually work? Probably. Will the WSJ - under Murdoch - attempt to de-index Google? Probably. Will they be alone? Certainly not in threatening to do so.

A decade ago the world faced a fork in the road…. In one direction was a universe with pay-for-crawl deals where search engines shared their excess profits with the content vendors. Down the other road? Well, that’s where we are now. Those same media giants were too scared, disorganized and ill-prepared for the tectonic shift the free-wheeling internet posed. Thus, they were only too happy to have their wares crawled and displayed somewhere. Free distribution! In fact, that’s how they described it. Suffice it to say, their opinions have changed. In the end, those with (good) content tend to get paid. It certainly will not happen overnight, but by the end of 2012? I would say that fork will have merged.

·5) Google’s hegemony has a half-life about half that of Microsoft
. Meaning, it will reach the populist doesn’t get it / is a death star stage in half the time. Some would say it’s already there. These would be the bleeding-edge types. Incumbents always have trouble transitioning to a new era. Despite a smorgasbord of books written on the subject, the issue is rarely the way they react to such situations. It’s in how they perceive them. Which is to say… they don’t. When you're at the top of the mountain, it's nearly impossible to overcome the feeling that you can see all. Until you actually feel it in the pocketbook. Then you panic and seldom make the right choices.

Does this mean Google won’t be meaningful? Does anyone truly believe Microsoft isn’t still meaningful? Of course it is. Both are and will continue to be giants. But as outsized profits are re-distributed back into the ecosystem to the creators and owners of content, quarterly results will go from reduced 'up-trajectory' velocity, to flat-ish, and maybe even down-and-to-the-right in some areas. Stocks will dip. In Google's case, people will speculate about what they will do with with all that cash. My guess… they will buy a big media company :-)

And for a change of pace, I predict...

·4) Lloyd Blankfein will not be CEO at Goldman Sachs
. His crime? Being too Googleable. Zero-sum-game hedge funds (like GS) do not do well in the spotlight; they are at their best working within the shadows, extracting profits from inefficient environments (or selling stuff nobody understands – you decide). At any rate, Goldman CEOs have always been notable for their distinct lack of notability outside of Wall Street. Blankfein no longer qualifies, and will ‘retire’ as soon as it’s clear he wasn’t forced to by outsiders.

·3) An accidental release of nano-particles will occur in a major body of water, killing an untold number of fish and other creatures as the tiny objects pass through the blood-brain barrier. This will lead to renewed cries for stricter regulation and temporarily slow down advancement in the technology. In an odd twist, this same core technology will one day dramatically improve the health of our world’s seas by delivering anti-pathogens to vast ocean-dwelling populations. But that will come later, after we kill a bunch of fish.

·2) People will begin to discover relatives they did not know they had
– via the intersection of DNA sequencing and the internet. This will bring to the masses what is only experienced at the leading periphery today; that one can meet and then dislike relatives not just based on physical proximity (which for all of history is how it has been done), but via the internet.

·1) Tiger will again win the Masters…. In 2012. Then the world will go boom. Or not. If it does, it will have nothing to do with the Mayans. Solar Cycle 24? Maybe.


Rich said...

I've been following you and enjoying your posts for a while now. I come from a technology background, starting way before you on the 2nd gen IBM equipment (1401, 7010 era).

I just wanted to let you know that I enjoy reading your posts and almost agree with your predictions (I think Tiger will win the Master either this year or next, for sure).

Unknown said...

The nanotech prediction is right on target. I personally dismiss ALL the other green crisis arguments except the seawater and sealife pollution of plastic microparticles (already clearly evident), and nanoparticles and medicines are clealy headed into the wastewaters. Global Sargasso Sea here we come.

Jean-Claude (JC) said...

I like what you wrote! I think you are making some great points, and the odds are in your favor that they will all come true. I do hope you are wrong with the nanotech prediction... nothing personal!
Love your blog!