Quotation of the day on the Exponential Age
"Welcome to the 4th Industrial Revolution. Welcome to the Exponential Age.
In 1998, Kodak had 170,000 employees and sold 85% of all photo paper worldwide. Within just a few years, its business model disappeared and it went bankrupt.
What happened to Kodak will happen in a lot of industries in the next 10 years – and most people don’t see it coming. Did you think in 1998 that 3 years later you would never take pictures on paper film again?
Yet digital cameras were invented in 1975. The first ones only had 10,000 pixels, but followed Moore’s law. So as with all exponential technologies, it was a disappointment for a long time, before it became superior and got mainstream in only a few short years. It will now happen with Artificial Intelligence, health, autonomous and electric cars, education, 3D printing, agriculture and jobs.
Software will disrupt most traditional industries in the next 5-10 years. Uber is just a software tool, they don’t own any cars, and are now the biggest taxi company in the world. Airbnb is now the biggest hotel company in the world, although they don’t own any properties."
I fully expect Uber to get this wrong, and go into the self drive car owning business. It is difficult to scrub the old out of the new, and those running Uber will have been steeped in the old. But then a new upstart will figure out that it will be much better to not own the vehicles, but only pay for use, allowing others to focus only on the vehicle business, while the new ride hailing company only focuses on the ride hailing.
During the 1970s, Boise Cascade cooperation, a wood products/paper company owned Princess Cruise Lines. At the time tax laws required idiotic cross investments like this, the results were very poorly run businesses. After Reagan ironed out most of these tax law inanities, the businesses shucked the incongruous, and focused again on what they did best. However, the integrated company with accountants, and lawyers, and sales, and all manner of specialties within remains. It has yet to be picked apart.
The new gig economy is poising itself to do just this, pick the integrated corporation apart, allowing each special unit to become just that special, and focused only on its specialty.
The world is poised to change in ways we cannot understand, and bring wealth, prosperity, opportunity, and work satisfaction we cannot imagine today.
If Uber integrates its self drive car ownership with ride hailing, it will likely falter as the tides of superior management cut cost below Uber's.
Don't be surprised if in a decade or two corporations are shrinking to 1/10 of their current employee levels, relying on an army of gig workers/independent contractors who enjoy their jobs more, earn more, and choose their own hours.
The American way, difficult we do immediately, the impossible takes a bit longer.