In Part 1 of this series, I discussed The Reciprocity Theory and introduced the need for brands to be purpose-driven. In Part 2, I discussed the foundational human behavior that underlies the purpose economy. Here in Part 3, I’ll discuss what we can learn from technological revolutions.
In her book, “Technological Revolutions and Financial Capital”, economist, Carlotta Perez, describes 5 successive technological revolutions of the last 250 years. The first was the Industrial Revolution, which launched with the opening of Arkwright’s mill in Cromford in 1771. The second was the Age of Steam and Railways. The third, the Age of Steal. The fourth, the Age of Oil, which launched with the first Model-T coming out of Ford’s plant in 1908. And, the fifth, the Age of Information and Telecommunications, which launched with the Intel microprocessor in 1971.
Each of these revolutions occurred approximately every half century, and followed the same revolutionary sequence: technological revolution, financial bubble, collapse, golden age, political unrest.
Carlotta tells us that, “A technological revolution can be defined as a powerful and highly visible cluster of new and dynamic technologies, products and industries, capable of bringing about an upheaval in the whole fabric of the economy and of propelling long-term upsurge of development. Each time around, what can be considered a ‘new economy’ takes root where the old economy has been faltering. But it is all achieved in a violent, wasteful and painful manner…The new wealth that accumulates at one end is often more than counterbalanced by the poverty that spreads at the other end…It is certainly a broken society, a two-faced world.”
Sound familiar? Does this sound like a story our society has been living the last 7 or 8 years?
If each technological revolution occurs about every half century, then the next revolution is scheduled to arrive sometime around 2021 or shortly after – just 6 years from now.
That means we’re somewhere in between a Golden Age and political unrest. We experienced the financial bubble for the good part of the 1990s and early 2000s, and the collapse in 2008. Now we’re living in an economy that is taking full advantage of innovations in cloud computing, social technologies and mobile devices. These innovations have led to the collaborative economy, the democratization of content publishing and citizen reporters that can create movements for or against brands – or even governments – by identifying a cause, a purpose, that resonates with a community of people, and exploiting it.
Perhaps even more thought provoking is to think about what the next revolution might bring.
But, first let’s take a deeper look at the lifecycle of a technological revolution.
You can see here that after the “big bang” moment, early new products and industries are born, and we see explosive growth and fast innovations. The Intel microprocessor was our current revolution’s big bang moment. And, Intel’s co-founder, Gordon Moore, observed that the number of transistors in a chip doubles about every two years. You engineers reading this know that this observation came to be known as Moore’s Law and has been critical to the acceleration of innovation over the last 40 years.
Later a full constellation of new industries, systems and infrastructure are born, followed by a full expansion of innovation and market potential. We can trace this evolution by looking at a history of social networking.
Venture capitalist, Mark Suster, brilliantly taught us a history of social networking in 2010. It started some 25 years ago with pre-internet social networking services like Prodigy, CompuServe and The Well. These services were online, and people connected for the same reasons we do today. Suster described these reasons as the 6 C’s: (1) Communications, (2) Connectedness, (3) Common Experience, (4) Content, (5) Commerce, and (6) Cool Experiences (entertainment). Ultimately, I think it goes back to Maslow’s Hierarchy, and achieving orders of needs. Or, more simply – the Reciprocity Theory and the interplay between the Individual and Community.
Then, AOL bridged the gap between pre-Internet and Internet with their walled garden. Web 1.0 made it easier to have personal pages on the worldwide web – not just behind a walled garden like AOL. And, web 2.0 accelerated user contribution, making it so much easier to capture and publish content.
And, as we progressed from our big bang moment, to the pre-Internet era, to web 1.0, to web 2.0, to today, we have, in fact, seen new industries, systems and infrastructures come to play.
Meanwhile, over the last 14 years, dialup internet access has fallen by 16% CAGR, and broadband internet access has grown by 25% CAGR. 70% of American adults now have high-speed broadband.
What’s more surprising, perhaps, is that 30% of Americans don’t. But, what really confounds me is that telecom companies consider Google Fiber, here we come!
55% of American adults have a smartphone, and 42% have a tablet computer.
Taking a global view, internet users are showing <10% year over year growth and slowing. Fastest growth in users is in developing markets like India, Indonesia and Nigeria. Smartphones +20% strong growth in subscribers, though slowing. The fastest growth is in underpenetrated markets like China, India Brazil and Indonesia. And, mobile data traffic is showing +81% accelerating growth with video being a key, strong driver.
And, and we’re seeing the full expansion of innovation and market potential that Carlotta Perez predicted, combining social and mobile, with Twitter and Tumblr and Foursquare and Instagram and Pinterest and SnapChat.
Is it any wonder that 2/3 of the digital universe is now content consumed and created by consumers?
Click here for the next post in the series where I discuss the socio-economic evolution we’re seeing coming out of this latest technological revolution.