Driving forces

Emerging trends that will affect way we live, think, act in '06 and beyondx

Thomas Frey

Saturday, February 11, 2006

2005 was defined by Google, iPods, The World is Flat, natural disasters, blogs, podcasting, Bill Gates, Steve Jobs and a dramatic influx of new technologies designed to give us freedom and control of our lives.

But 2006 will feel quite different as we shift into a new gear. Here are some of the key trends that will make the coming year one to remember.

• Confluence of influence. The do-it- yourself-content movement has opened the doors for many things to happen. DIY content comes in many forms from blogs, to podcasts, to vidcasts or video blogs. This has given several million people a voice in what's going on, and when several million people talk, the rest of the world listens.

In the past, it would take several weeks for news stories to build and for changes to happen. Now it takes a few days. And this will affect many areas of the world. Demand for certain products will almost instantly take off like a rocket or totally crater. Businesses will seemingly disappear overnight, and others will come from nowhere and become mega-businesses in a similar fashion.

Celebrities will see their fame rise and fall at the speed of light. The life cycle of fad products will have even shorter and steeper up-and-down curves. The business world will have little time to react, and, as a result, we will see what looks like chaos in the stock market until executives start to gain a handle on this new tempo for business.

• Simple and smart products. We've spent the past 20 years adding features and functionality, and 99 percent of those features and functionality aren't needed. At the same time we are compressing more and more into our 24-hour days. We have to work fast, act fast, eat fast, and we make far more decisions in a day than ever before in history. And we need products that support this lifestyle.

We need products that are simple and easy to use that make decisions for us. We need smart products that know what we want and when we want it. The technology behind the products may be complicated, but the user interface will be simple and easy to use. There will be an enormous market over the next several years for this seemingly really simple stuff.

• The death of wires. The world of wires has already begun its long descent into oblivion as wireless technology improves to the point where wires become obsolete. WiMax will replace WiFi. WiMax is the wireless technology that sends signals 30 miles in each direction. Communities will quickly make high-speed Internet available to everyone either very cheap or for free. ISP businesses are set for major upheaval in 2006.

In the telecom world, the Baby Bells are shifting their business models as money from traditional "wired" phones is in decline and more and more of their revenues are coming from cell phones. But the VoIP phones are making major inroads. Voice-over-Internet-protocol phones work through the Internet, and if you make calls to other VoIP phones, the calls are free. We are already seeing dual-mode cell phones that can switch from cellular to WiFi, and soon all phone calls will be made wirelessly through WiMax connections.

It will be a few years, but eventually power lines will also go away. Wireless power has long been a possibility, but the industry still operates like a monopoly with little incentive to change. But change will happen, and the ugly power lines will eventually come down.

• The empire of one. Entrepreneurship is oftentimes a brutal environment to exist in, but it also has many appealing qualities that make it a magnet for people who find themselves in one of those life-changing situations. Many will chose to do consulting or contract work to bring in money. Others will buy a franchise or start a business that they hope to grow in time. But a rare few are now developing a business we call the "empire of one."

An empire-of-one business is a one-person business with far-reaching influence. Typically, the business outsources everything - products manufactured in China or India, sent to a distribution center in the U.S., with customers in the U.K. and Brazil. Manufacturing, marketing, bookkeeping, accounting, legal and operations are all outsourced to other businesses around the world.

The empire-of-one business model is one with great appeal to former corporate executives with global contacts and good ability to manage things remotely. We will see a sharp increase in these types of businesses starting in 2006.

• Economic boom in the building industry. Hurricane Katrina and China place huge demands on building materials and natural resources, sending prices skyrocketing. But the money freed up to pay for the rebuilding of New Orleans will create an economic boom time for the building industry in Louisiana, with strong ripple effects into other areas of the country.

The analogy I like to make is that the dot-com boom in the late '90s was largely fueled by money spent to fix the Y2K problem. This money worked its way through the system and supercharged the emerging dot-com world. The $200 billion spent to rebuild New Orleans will work its way through the system, causing a boom in surrounding industries.

• Weather control research will take center stage. In the past, we've always felt the balance of nature was too delicate to mess with, but the recent mega-disasters have become far too expensive for some companies to just want to leave everything to chance. In short, "We're tired as hell of hurricanes, and we don't want to take it anymore."

Weather control technology is not new. If you think about it, we've been trying to control the weather since man was first placed on the Earth. First in micro-environments, wearing skins and clothing to keep us warm and to protect us from the elements. Later building shelters and homes, again to protect us from the weather. Now we find ourselves at a point where we will need to control things on a more macro scale, and scientists will start to emerge with credible plans for regulating the weather.

• The age of hyper-individuality. We no longer care about "keeping up with the Joneses." We don't care what car our neighbor drives or the kind of television they bought. We are much more interested in buying products that work for us.

We are faced with an unending stream of new products. In the past, products that only appealed to one in 35,000 people would never have made it to store shelves, but today the Internet creates marketing channels that make this type of product viable. On Amazon we can find 2 million books, on iTunes more than a million songs, in the Software Superstore more than a million software products. There are 19 million known chemical substances today, and the number is doubling every 13 years, reaching 80 million by 2025. Grocery store products are being created at the rate of one every 30 minutes.

Now more than ever, we can define who we are and what we care about with the millions of micro-defining choices we make. And people will become more and more complicated.

• Globalism continues. The first wave of globalism saw outsourcing of manufacturing and services. The second wave will be young entrepreneurs around the world ready to compete head to head with us on a number of fronts.

The global marketplace is huge and growing with the promise of lucrative foreign markets, which are growing more quickly than in the United States. Some overseas opportunities are now even bigger than here, such as cell-phone sales in China.

The Silicon Valley model of nurturing startups has spread to other regions around the world. Venture capitalists are opening offices in those countries and are getting more comfortable with helping to nurture companies in foreign markets.

• The year of video. The convergence of television and computers will make some major strides in 2006. At some point, a major shift will occur and people will no longer be satisfied with only watching television. And at a similar point in time, a large segment of computer users will decide that they prefer a less-demanding, more-entertaining form of surfing the Internet.

It's been very difficult to effectively measure the cultural pulse of the various user communities, but it is the seemingly minor shifts that spawn entire new industries. People who are early adopters rarely understand the thinking of the cultural mainstream. Nor are they particularly good predictors of coming trends. But the driving forces of freedom and control offer great insights into people's needs.

People are demanding a larger sensory experience. They want larger screens and more of them. They want to interact with information quickly, easily and whenever they want. They want the flow of ideas to sync perfectly with their own idiosyncrasies, and they want to be surrounded with smart appliances that can read their minds and know what they want. We no longer have the time or patience to figure out complicated interface devices. Our brains are just too cluttered for that.

• Breakthroughs in space. The biggest trends in space in 2006 will be the shifts in thinking. Nearly every day new images come from space that boggle the mind and show us how little we know about the universe, and we will come to the realization that the human race cannot survive if all humans live on only one planet.

The world watched in amazement as the NASA Deep Impact probe collided with the comet and sent a cloud of brilliantly lighted dust into the air. Photos of the impact were downloaded over 2 billion times, showing industry watchers the immense appetite people have for understanding the rest of the universe.

In December 2005, Virgin Galactic, the British company created by Richard Branson to send tourists into space, announced plans to build a $225 million spaceport in New Mexico. This announcement has set the stage for a massive building project but, more importantly, has set the stage for a massive shift toward the privatization of space.

Thomas Frey is executive director of the DaVinci Institute, a nonprofit think tank based in Colorado. He can be reached at dr2tom@davinciinstitute.com or 303-666-4133.