Editor’s Note: Following is an excerpt from Tyler Newton’s “Ten Trends for the Tens.” Newton is research director and partner at Catalyst, whose investments include software-as-a-service, smartphone applications, wireless infrastructure, machine-to-machine communications and smart grid services. Advantage Business Media, Wireless Week parent company, is a Catalyst investment. The full post can be found here
A new decade is right around the corner. I expect we’ll start to see a lot of prognostication soon, so I will attempt to get out ahead of the crowd. At Catalyst we research growth industries and invest in businesses that have recurring, advertising or subscription-based revenue. Growth industries ride the big product adoption trends. Here are big industry trends we intend to capitalize on.
Applications move to the “cloud” – An obvious prediction, but its importance cannot be overstated. Software and content will continue to migrate to the internet, or the “cloud.” Devices on the edge will therefore be able to simplify and specialize, like netbooks for web surfing, iPods for listening to music, BlackBerrys for accessing corporate information, Kindles for reading. Business applications will rapidly move to the internet, where they are cheaper to deliver, more frequently upgraded and will allow access to more real time information.
The tribal internet – Social networking and internet content will evolve into networks of sites and information streams focused around common interests. Whether it’s for work, hobbies or issue advocacy, interest groups will form virtual “tribes” online, sharing content, ideas, opinions, advice and information among themselves. Magazines, blogs, email newsletters and video content are already interlinked and shared and promoted via RSS feeds and social networks like Twitter, LinkedIn, and Facebook. Because these tribes are built around natural affinities, in many ways they will have a more powerful hold on us than our existing groups based on schools and location. Marketers will not be successful with old-fashioned advertising that interrupts this flow of content. Successful marketers will be those that are able to join and gain the trust of the tribes, where people WANT to receive the marketing message.
The internet is all around you – As applications, content and communities move to the web, we become increasingly dependent on the web and will demand access everywhere and at all times. The functionality of smartphones and other wireless access devices will keep increasing, so that we can wirelessly do most of what we currently do on the computer. Wireless networks will dramatically increase the amount of data capacity and will at least rival the speeds of today’s DSL lines. We will get to the point that we’re connected to the internet 24/7, both for work and for fun.
Sensors, sensors everywhere – With a smart web analyzing data and ubiquitous wireless network access, internet-connected sensors will be measuring all sorts of data. Our vital signs, energy usage, soil moisture, traffic patterns, manufacturing efficiency… it will all be tracked remotely and analyzed in real time and fed into the Smart Web, increasing business productivity. Some have called this the “Internet of Machines,” machine-to-machine communications or M2M. Asset productivity and utilization will soar immensely, reducing the relative demand for business investment overall. The combination of web-based software, the Smart Web and M2M will create one of the fastest leaps in worker productivity in human history over the next 10-20 years.
The decentralization of medicine – The current hospital-centric health care system is an inefficient amalgamation of disparate systems that do not communicate with each other. Networked medicine, information record standards and focus on prevention and wellness could break it all apart. Data tracking can revolutionize disease management, nutrition, exercise, home health care and remote medicine. The centralized delivery model is more of an industrial-age organization form relative to the networked-based economy of today. The use of hospitals will decline in favor of doctor house calls, “video visits” and visits to (or visits from) specialists loaded with high tech equipment and software.
Building the “electricity superhighway” – The shift away from fossil fuels will increase our reliance on electricity, particularly in transportation. The smart grid initiatives pursued today are equivalent to the Telecom Act of 1996 – a catalyst that will lead to the transformation of the utility industry as the electricity superhighway gets built out. The implementation of a smart grid will allow for more efficient and balanced use of the electrical grid. Energy storage systems will take energy from intermittent sources like sun and wind or from traditional power plants during off-peak times for use during peak times. Power will continue to be sold from utility to consumer, but also flow from small-scale power sources like rooftop solar panels back to the utility when not being consumed. Small-scale energy storage systems like reversible fuel cells or batteries could do away with the whole concept of peak/off-peak pricing altogether. The move to electric or hybrid cars, combined with investments in more electrical generation capacity (from nuclear, alternatives and natural gas) and a smart electrical grid will dramatically reduce the largest cause of the U.S. trade deficit: our reliance on foreign oil.