Eoin Treacy – Exponential Investor (United Kingdom) –
It’s easy to get excited about technology, that’s why I love writing about it. However, there is another aspect to technology that makes it different to all other sectors. It is enabling.
When Coca-Cola and Nestlé started selling bottled water it was a wonderful idea and has turned into an enormous business. However, I think you’ll agree it would be a stretch to say that this marketing innovation changed the world for the better. It would be a lot easier to say we are worse off because of all the trash and the additional salt we are consuming by drinking it.
Technology on the other hand really does have the potential to change how we lead our lives for the better. The smartphone is an example of that. In the US it is still common to see people using cheques. In fact, I had to relearn how to write one when I moved here. In Europe we are all familiar with chip and PIN, but in China everyone just uses their smartphone to pay for everything.
What that tells us is that once a technology gets established in the financial system, the parties concerned are terrified of changing anything so the pieces of kit stay around for longer. It’s almost like gym memberships. The gym will be happy for you to pay every month and never use it, but it will never call you and say it has a new way for you to pay because that might prompt you to quit instead of adopting the new platform. Banks think of us in the same way so they tend to be very slow in adopting new technology.
What is happening in India today with smartphones is one of the best examples of how a system that does not have the legacy architecture we have can leapfrog whole stages of development. It is a perfect example of how technology is enabling to further development and innovation.
India has about 200 million people that cannot read or write. So how do you integrate that many people into the digital economy? Login and password is not possible for people who can’t read. Additionally, the retail banking network is underdeveloped so there is no way for many of these people to get a bank account. The education system is spotty so they don’t have the opportunity to learn to read and write. It has always been an intransigent problem and technology is helping to solve it.
Three converging themes have created a solution. The first is voice recognition technology which is improving all the time. With voice-driven searches rather than having to write, people can simply speak into the phone’s microphone. That is immediately opening up the potential for people on the lowest rungs of society to have the ability to have their questions answered for the first time.
Next the government conducted a programme to collect biometric data from every single one of the country’s 1.3 billion people. This was an enormously costly and painstaking process and it was completed last year. That means the government now has fingerprint and retinal scans for every person in the country. The first thing it did with that data was to open an online bank account for every family in India.
Next everyone is familiar with pictures from India of trains overflowing with people and of technological infrastructure that is Victorian at best. What many people do not know is that India now has 4G mobile connectivity over the whole country. Mukesh Ambani made the unilateral decision to build a 4G network at great expense and his Reliance Industries now owns the only such network in the country. Phones and broadband access are cheap so that everyone can afford them so now everyone, regardless of social strata, has a phone with high-speed internet built in.
Add the three of these developments together we can see that the complimentary evolution of voice recognition, 4G and smartphones together with the provision of key pieces of government infrastructure are going to help lift hundreds of millions of people out of knowledge poverty. That is the first step on the road to a better life.
The really important point is that the internet-enabled smartphone is one of the most enabling pieces of technology that has evolved over the last couple of decades. There is a real chance that the banking sector will not now have to build retail bank networks. Online payments mean that the ranges of services that can be delivered online balloons. Everything from social media to YouTube, education to news, healthcare to shopping can be delivered via smartphone. These three themes represent the beginning of a digital renaissance for a country like India.
That’s what I mean when I talk about enabling technologies. The rollout of 5G in the US and Europe will enable the rollout of autonomous vehicles, hive mind traffic, virtual reality at your desk, media content literally everywhere. The combination of CRISPR gene editing technology coupled with the collapsing cost of genetic sequencing means the pace of innovation in healthcare in accelerating. That means it is not wild and wooly fantasy to think about what the future will hold. Change your eye colour, live longer, grow taller or more intelligent are all possible outcomes. How about cure cancer, Alzheimer’s or Parkinson’s? 3D printing is another enabling technology because it reduces the time required for prototyping and allows customised end products to be created on the fly. SpaceX’s nose cone was 3D printed and that is another example of how enabling technologies contribute to the accelerating pace of innovation.
All the best,