Category Archives: Culture

These posts will deal with Copyright and other cultural topics

Disruptive technologies and long term impacts IV

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In yesterdays post (click here for the first in my series) I discussed some of the long term implications mostly related to the software industry. However, these ideas relate to some of my previous blog posts about innovation in that post I talk about long waves and these paradigmatic type technologies. Where we need to be aware that these disruptive technologies can interact with society on a number of different levels. In the case of video game consoles, while a pretty big industry, it’s not a big chunk of our overall economic output. Even with in video games, you could argue that different types of coding methods have revolutionized how writing video games occur, so you can make these steps as small as possible, or as large as you can think of like the semiconductor based transistor. The transistor has lead to a huge shift in how our economy works.

The problem with new technologies is that we never know ahead of time what the impact of a disruptive technology will be. For instance, of the renewable energy sources we can’t tell which one will have the most long term impact. However, these are all disruptive technologies. If enough solar, wind, wave, and geothermal energy were produced we wouldn’t have a need for coal fired plants. This would create a massive shift in our economy. It would destroy a lot of mining companies, would shutter many power plants and put people out of jobs from the mining companies and the power plants. Of course changing from a poisonous energy source that we are rapidly depleting to a fully renewable resource is completely desirable. However, these disruptive technologies will have farther longer term impacts that we think of initially.

These new energy sources may eventually have lower energy costs than we currently experience under the coal/oil/gas regime. However, this extra money is typically spent on other goods. Which should be cheaper as energy costs are reduced. In many industries, the biggest expense is on energy. Reducing that will significantly shift the cost of these products. Unless, of course, the companies keep the higher prices to keep up profits. These lower costs should make it easier for new companies to enter with a lower price point which will keep innovation moving forward.

There difficulties with adopting new technologies. There are a lot of socio economic reasons to minimize the adoption of a disruptive technology. In my next blog I’ll discuss some different theories of how new technologies are adopted.

Disruptive technologies and long term impacts III

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As I discussed yesterday, disruptive technology’s impact can be mitigated by extensive networks. So how do these networks form? Well, they can be formed by movement of employees, which can lead to an exchange of tacit knowledge as well as increasing the likelihood for a collaboration. For instance, my roommate’s employer has asked if his former professor would like to collaborate with them. This would lead to a direct knowledge flow from a large university in the US to a public-private research organization in the NL which would then diffuse to that organization’s partners. These networks can help reduce uncertainty through an ability to acquire additional skills sets which are not currently possessed within an organization.

The networks can be built through previous collaborations, suggests of a previous intermediary organization, such as a publisher in the video game sense. Or there could be other forms of collaboration such as licensing technologies like the Quake/Unreal engines in video games. This allows for a full knowledge transfer of technology from one organization to another through formal methods. However, the reason for adopting one technology over the other could come down to a single employee which used to use one or the other technology at a previous job.

Now, how do these impact long term innovations and economic growth? I haven’t talked about that at all. It’s not exactly straight forward. In some ways, as you can see from the network diagrams yesterday, these disruptive technologies have clearly lead to an explosion of growth within the video game industry. This is most likely why it’s over a multi-billion dollar a year industry. Extensive networking and collaboration at the beginning of a new generation of technology is good for the console maker and the consumer as it leads to a faster ramp of video games. See the graph below:

So, these networks help expand the options for consumers and lead to growth in the industry. Disruptive technologies are really good for the economy. Otherwise, we’d see a steady decline in prices and demand for products as people will already have them. In the example of video games, there are other drivers forcing the continued evolution of console technology, such as competition with the PC gaming platform, as well as continued expectations of better graphics and better game play. While there are a lot of people that scoff at the consoles, they do drive expectations for better graphics. People get tired of the same visual representation of their football teams. They want to see the graphics improve, the physics engines improve. Basically they need a continued improvement of technology to meet these expectations. These in turn help push the boundaries of PC games as well.

This is a fairly rosy picture of this march forward. There’s no concern for intellectual property, any licensing that is being done is obvious. I don’t expect this to continue. Which brings us back to the software patenting issue. We all know it’s a horrible thing.

References:
Vaan, Mathijs de, “Interfirm Networks and firm performance in the face of technological discontinuities” 2010 Druid conference

Disruptive technologies and long term impacts II

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Yesterday I discussed how disruptive technologies can drive our economy through creating new opportunities. However, it can obviously have some very negative impacts at the firm level. Let’s look at consoles again. First, as most of us are aware, there are only three major console manufacturers in existence. There have been a pretty steady number of console makers since the 90’s however the players have changed. Sega and Nintendo were the biggest players when I was young, however this shifted to Sony and Nintendo in the mid 90’s with the N64 and Playstation. The console makers are only half of it though. Without publishers, like EA, game developers, like Bungee, the gaming industry would die.

The people impacted by the changing in consoles are not just the console makers themselves, but also the publishers and the developers. In fact, it could be argued that the different platforms (consoles and PC) make it as difficult or more difficult for the developers. Some games the console makers want specifically for their console only. This cuts into the potential profits of a game developer. Additionally, there are difficulties of learning how to program for the new systems. Not all game developer or publisher is going to get early access to the new console. This makes it very difficult for them to actually compete with other developers, which do.

In a pretty cool paper (Vaan, 2010) that looks into the survival rate of developers and publishers after a disruptive change, they investigate the role of a networks. Below is a time series of network changes. Which show that the closer you are to the center of the network increases survival rate.

Network of video game developers (Vaan, 2010)

These networks are important outside of the video game industry as well. In my next blog I’ll go into more details about the importance of networks in surviving new technologies.

References:
Vaan, Mathijs de, “Interfirm Networks and firm performance in the face of technological discontinuities” 2010 Druid conference

The different meanings of internet freedom

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This week we have seen some incredible riots in London. Interestingly, some of these riots were actually predicted by some of the youths a few weeks back, at the end of the video one of the youths mentions that there will be riots. David Cameron had some choice points about the use of social media, Ars Technica has a good discussion about the different sides of social media. However, it is mostly discussing it in terms of causing the riots as well as leading to the clean up of the cit of London.

I find the reaction that we’re seeing on the internet to the usage of Black Berry Messenger and Twitter interesting. These are the same forces that while in affect in countries like Tunisia and Egypt, social media were forces to be praised. However, now that they are being used in England instead they are being vilified. Also, we are seeing pressure from the government to use social media to arrest the members of these gangs.

First, I think what these groups did was horrible. If I was able to I’d try to help the victims of these crimes. However, we need to be aware of the precedence we are setting in the response to this. While there are some differences in the actions, there was looting in Egypt and Tunisia, there are also differences in the situation. The major difference comes from the leaders being elected compared to being despots.

Based on the interviews the Guardian conducted we can see that the youths are unemployed and marginalized. This is similar to what was going on within Tunisia and Egypt. High unemployment and lack things for the kids to do. It’s something of a structural issues. Which Cameron acknowledged yesterday in a speech. So some of the reasons are similar between the rioters in London and with the Arab spring.

However, since it is England asking for data from Twitter and BlackBerry, they are much more will to cooperate with the police. I’m not entirely sure this would have happened in any of the countries involved in the Arab Spring. Leverage over Twitter during the Arab Spring could have killed it. Do we pick and choose which riots we support? I think it’s clear that we do.

We just need to be aware of the precedence we are setting and that all countries around the world are going to emulate the response of the US and England in this riot. There’s no reason why China, Iran, North Korea, or any other country shouldn’t expect Twitter to comply with them if Twitter complies with England.

The actions that our governments take in this case could have long term implications in regards to internet freedom. It also will indicate if there are two different classes of countries when it comes to the allowable types of internet freedom.

I don’t condone what happened, but we need to really understand the repercussions of the actions in wake of these riots.