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Shifting Power: The Future of Electricity

by Jack Uldrich and Simon J. Anderson on 01/24/12

In the spring of 2014, the largest solar flare storm to strike North America in one hundred years disabled hundreds of transformers and transmission lines across the United States and Canada. In the ensuing weeks an estimated 50 million citizens were stranded without electricity and, in a few remote areas, it was a full month before regular power was restored. The event resulted in 15,000 deaths, mainly due to the fact that emergency back-up generators at scores of hospitals across the country were unable to operate for more than a few days, and many life-supporting devices weren't able to function. The catastrophe also dealt a serious blow to the global economy as thousands of businesses couldn't operate. Conservative estimates placed the economic damage at $2 trillion - more than 16 times the cost of the 9-11 terrorist attacks. 

In the aftermath of the crisis, politicians, regulators, and citizens demanded to know "How could this happen?" A few, more farsighted individuals asked, "What did we learn from this event and how can we prevent it from happening again?"

The scene described below takes place at a board meeting of a regional utility cooperative in the Midwest. The board is preparing a strategic plan for the year 2020. The main protagonists are Dylan, the cooperative's progressive 40 year-old executive director and Edgar, the board's more conservative-thinking chairman. The former is new to his responsibilities, while Edgar has served as chair for 15 years. Positioned between the two men is Miriam, a utility industry consultant who has been charged with facilitating the board's strategic planning session. The following discussion takes place after the board has heard from a series of industry experts discussing the latest "Smart Grid" advances in battery technology, software, sensors, transmission wires, solid-state transistors and commercial developments in renewable energy.

Scenario

Miriam began the afternoon's final session by addressing Dylan and Edgar. "You both agree that the utility industry can't return to business-as-usual. You also agree significant changes need to be made in order to make the grid more reliable. That's good. The bad news is your respective visions of the near-term future are so radically different that compromise might be difficult. I suggest we focus first on the broad areas of agreement - the low-hanging fruit, if you will. Next, we'll turn to the more controversial areas and let both of you spell out your respective views for the other board members to consider. We'll then take a vote on the strategic direction of the utility."

 "From our earlier discussion," continued Miriam, "it's clear we can agree the consumer has become more efficient in their use of electricity. If there's a silver lining to the solar flare outage it's that users have become sensitized to conserving energy because they understand its importance. What's more is that all of the major appliance manufacturers have accelerated their plans to make their refrigerators, dishwashers and washing and drying machines "Smart Grid" compliant within the coming year - which should further accelerate the push toward energy conservation."

"I agree," said Edgar, "and let's not forget LED lights. They're becoming less expensive, brighter and longer lasting. Home energy usage should continue to drop further as a result. I also think the consumers will use the appliances to make smarter decisions about when, for example, they run their air conditioners in the summer or how long they operate their humidifiers in the winter." Edgar then paused before adding, "But I don't think we can count on smart meters to deliver the long sought-after promise of 'dynamic' or 'real-time' pricing. For that to take place, we'll need state regulators across our region to agree to the installation of the devices. Past experience tells us that neither regulators, politicians nor our customers trust the smart meters will deliver lower prices. What's more, a great number of folks still believe the devices can cause brain cancer or are a blatant invasion of their privacy. We can't count on smart meters taking root. At least not in our part of the country."

"I disagree," said Dylan, "and I'm confident we can lead the way. In fact, I'd like to propose we hire a software programmer with a specialty in gaming dynamics to help us figure out how our customers can use their mobile devices to better monitor and control their home energy usage through the smart meters. Even if the technology lowers their electricity usage by just five percent that'd be equal to not having to produce more than 1 Gigawatt annually - or the equivalent of not building a half dozen mid-sized coal-power plants. We need to focus on this area." Dylan then emphasized his point by adding, "The most efficient power plant is the one we never need to build."

"Have you looked at our demographics," snapped Edgar. "Most of our customers are 55 or older and they aren't tech-savvy. There's no way they're going to embrace smart meters, real-time pricing or gaming dynamics - whatever the hell that is."

"We need to get serious about building some new next-generation clean-coal power plants," continued Edgar.

"We need to get serious about focusing on 'negawatts,' replied Dylan. "The cleanest energy is that energy which is conserved and, as a result, is never produced."

Stepping in between the two men in her role as facilitator was Miriam, "You both agree, though, that many of your larger industrial customers - such as the grocery chains - are willing to utilize demand response technology to control their energy use during periods of peak usage in return for substantial savings. It seems that any technology that can help produce 'negawatts' makes sense. Also, industry forecasting tools are continuously improving and new data mining technologies are helping us determine which customers to target for these new services."

Dylan nodded his head in vigorous agreement. Edgar was non-committed and responded by saying, "Yeah that's true for our industrial customers but I'm talking about our residential customers who make up half of our business."

"You're asking the wrong question with regard to our older customers," said Dylan. "You're asking: 'Will they employ smart meters and use gaming dynamics?' The question you need to ask is: 'Do our customers want to save money?' The answer to that is a resounding 'yes' - especially among the very customers you are talking about, Edgar. Their views about money were instilled by parents raised during the Depression. They value every penny and if a new device can deliver real savings they'll embrace it."

"I'll believe when I see it," said Edgar in a dismissive tone.

Not one to back down, Dylan shot back, "The fastest-growing demographic among video-gamers are people 55 and older. Why? I'll tell you why: Because many of the new games are so easy and intuitive that they can now play them with their grandchildren. My point is that if a technology is simple enough - and if it saves money - people will embrace it." Catching his breath, Dylan then added, "And if you look closely at the most successful electronics retailers and manufacturers, they are beginning to design, sell and market thermostats and other home energy saving tools such as 'plug-and-play' micro wind turbines. They're making these devices attractive and easy-to-use and install. As more people begin to understand they're protecting both the environment and their pocketbooks, the market for these tools is going to skyrocket! Who knows: Our greatest challenge in the near future might not be a scarcity of coal and nuclear power but an abundance of renewable energies." 

"OK. Everyone keep their cool," interjected Miriam. "Let's keep this conversation moving forward. Over the past few days, we've heard from a number of experts telling us solid-state transformers and new high-temperature superconducting transmission wires have reached a price point where utilities can begin installing them on a large-scale basis."

"That's right," said Edgar. "If smart meters are the brains of the smart grid - and I'm still not convinced they are - solid-state transformers are definitely the muscle. They are going to allow us to more efficiently and effectively convert the direct current (DC) power from the new power plants we need to build to the alternating current (AC) our customers use; and the new wires will dramatically reduce on 'line-loss'. These are two areas we definitely need to make a strategic investment."

"Not so fast," said Dylan breaking in, "I agree we need to make a strategic investment in both solid-state transformers and new transmission wires but not for the reasons you suggest. We should be investing in solid-state technology because it'll allow us to more effectively handle inputs from the various new energy sources beginning to pop up everywhere - such as community solar farms, solar-collecting windows and natural gas operated fuel cells. More significantly, solid-state transformers are going to allow for the bi-directional transfer of power between consumers as well as help us engage in more effect dynamic pricing. In short, these devices are going to facilitate the creation of new business models that we need to take advantage of."

"Such as...?" chided Edgar.

"I don't exactly know yet ... maybe pre-paid electricity plans. If a customer can only afford to budget a $100 a month for electricity, they might be more willing to agree to a smart meter or a smart device that can help them operate their appliances only when energy is available at affordable prices."

"I do know that if people can begin producing their own energy from highly-efficient solar cells; low-cost fuel cells and better generating wind turbines and store that excess power in high-storage batteries, then we need to figure out how to play in this future! Solid-state transformers are going to allow citizens to sell the excess power they create from their wind turbines and solar windows and sell it to their neighbors. What's our role in this new future?"

"Stop right, there," replied Edgar. "You just made a number of assumptions in that last statement. Look, I understand you think climate change is real and that the world needs to move toward renewable energy, but we just experienced a massive and tragic electricity outage last year and no one - and I mean no one  - wants to revisit that experience. The public expects reliable low-cost electricity. The only known sources that do that are coal, nuclear, hydro and, in some limited cases, wind. We need to focus on building newer, cleaner coal plants and some nuclear plants - not worry about how Farmer Joe can sell his excess wind power to Citizen Sally."

"Now it's my turn to question assumptions," interjected Dylan. "First, my emphasis on renewable energy has little to do with my personal concerns over global climate change - which, by the way, I share with almost every credible scientist in the world - and everything to do with economics. Advances in nanotechnology are poised to make solar power competitive with coal in 2015 - not in 2020 or 2030 but next year! Second, advances in material science are allowing for the creation of new wind turbines that have smaller form factors and can operate at lower wind speeds. Third, the fact that three companies are now selling low-cost fuel cells at a profit - without relying on any government subsidies - suggests they're a real threat to the status quo. Finally, new high storage, grid-capable batteries capable of 25,000 recharges will soon be on the market. These devices will allow us to store the energy produced from the wind turbines on windy days and from solar panels on sunny days and then use that energy when the wind isn't blowing or it's cloudy. They'll also allow Farmer Joe to do the same. In essence, these devices will take the variability out of renewable energy sources. Distributed, decentralized energy is here, now."

"Moreover," continued Dylan, "whether you agree with my analysis or not, you need to know a couple of things: First, in Germany 75 percent of all renewable energy is produced by public citizens, not the utility industry. Germany's reality will soon be our reality. There are also companies out there who understand these numbers and are beginning to assume the upfront cost of producing, installing and maintaining solar cells, wind turbines and fuel cells in exchange for locking customers into fixed contracts below the price we are selling electricity. The bottom-line is that these new businesses don't require their customers to put down any money on capital expenditures. For all practical purposes, they're taking the risk out of purchasing renewable energy. How do you get around these realities? Also, how do you get around the reality that there are now a growing number of cities and communities around the world aggressively pursuing "net-zero" carbon emission goals - and they're doing it not by relying on nuclear power but on renewable energy sources?"

By this time Miriam had lost control of the discussion and decided it best to let both Dylan and Edgar air their arguments without interruption and work afterwards to see what agreement, if any, was possible. If that happened, Miriam thought to herself that the two men's agreement on solid-state transistors, superconducting wires and 'negawatts' might be a good place to start.

"I get around that reality by reminding you we've been hearing about these advances for years and nothing - and I mean nothing - has ever come from them! How do you get over the reality that 90 percent of the electricity produced in this country still comes from coal and nuclear!"

"I get over that reality," replied Dylan, "by reminding you that when change happens, it happens fast. In 1850, the leading source of oil was from whales. The whaling industry couldn't fathom a different way of doing things. A decade later they were obsolete because of the discovery of oil in the fields of Pennsylvania." 

"In the early 2000's, the publishing industry couldn't conceive people would ever warm to the use of electronic books. Today, more 70 percent of all sales are e-books. And, in 2010 the automobile industry couldn't imagine hundreds of thousands of young consumers would be utilizing their social networks and other location-based tools to engage in car sharing and that those services would cannibalize many of their sales. Less than five years later it's a reality and the first of the three major U.S. automobile companies will probably go bankrupt in late 2015 or early 2016 ... only this time the government isn't going to step in and bail them out."

"Look," continued Dylan, "every industry thinks it's different; that it's somehow unique or special and that it doesn't need to change. Well, I hate to tell you this but there's nothing special about electricity, and if it can be produced, transmitted and sold cheaper and more effectively it will be." 

"We've been an effective and efficient conduit for the production and transmission of electricity for more than 100 years but so what? Our past success is no guarantee of continued future success."

In a more peaceful and conciliatory tone, Dylan then concluded by saying, "The one thing I know is that we must change. The nature of how electrical power is being produced, distributed and consumed is changing and so must we. I think we'd all be wise to recall the saying: 'It is not the strongest of the species that survives, nor the most intelligent; it is those most able to adapt.' Our industry needs to adapt now or we're going to go the way of the Dodo bird, just like the whaling, publishing and automobile industries."

 

Top Twelve Trends For 2012

by Jack Uldrich and Simon J. Anderson on 12/22/11

Top Twelve Trends For 2012

By: Simon J. Anderson

1. Tremendous Increase in the Use of Personal Monitoring Devices  

We are witnessing the beginning of a soon-to-be massive trend: personal monitoring. With devices like Jawbone's widely discussed Up and FitBit's competitive offering, people are already using these devices in major numbers. This is not just going to affect health monitoring devices either; many sporting goods companies are seeing the value of incorporating monitoring devices as well, including Adidas with their new soccer shoes and Swimsense swimming bracelets. And, monitoring devices aren't just being used for health tracking and athletic improvement. Recently, a company introduced shoes that have a GPS tracking unit in them to help caregivers keep track of Alzheimer's patients. As more of these devices get into the hands (and on the bodies) of consumers, healthcare will likely improve, assuming healthcare providers can quickly learn how to use this vast new stream of patient information. Also, expect athletics to be enhanced as premier athletes gain a better understanding of their practices and performances.

 

Possible secondary effects:

Insurance companies start asking for this data, first offering a discount on service for providing information and hitting certain metrics, such as hours of sleep and frequency of gym visits, and then raising prices if you opt-out.

 

2. Sub $500 3D Printer Hits the Market, and So Begins the First Major Push Into Homes

Although 3D printing has been around for more than two decades now, it is making major advances and the number and types of devices to choose from has been growing steadily. 3D printing is no longer just for large industrial companies to make rapid prototypes. There is already a quickly growing list of services that allow anyone to choose from a catalog of designs or even submit their own design to have printed out and sent to them. Established websites such as Shapeways.com and newcomer MyRobotNation.com allow easy creation and purchase of a physical manifestation of your idea. And, if you are interested in skipping the "middle-man" and making your creations right at home, there are now a wide variety of options of machines available for around $1300, and earlier this month a basic machine from Printrbot became available in limited quantities for only a $499 Kickstarter donation (total donations reached nearly a million dollars and will certainly attract other companies to make their own offerings). As the price drops well below the thousand dollar mark, which it will in 2012, and as 3D printing communities such as Thingaverse continue to grow, we will begin to hit a critical mass that will drive widespread adoption. The number of services available to users to print out their creations will grow significantly in the next year, and I expect a large company to develop and mass produce a consumer-focused 3D printer and launch a full marketing campaign behind it. Initial advertising will be primarily focused on creating toys and jewelry at home.

 

Possible secondary effects:

Manufacturing companies start seeing a possibility for major disruption to their businesses and some adopt the technology and begin looking for ways to embrace it, while others fight it vigorously, desperately justifying their continued existence. Meanwhile, children everywhere begin to enjoy printing out a new toy after seeing a commercial for it just by entering a special code and paying a small fee.

 

3.   3. One-Step Closer to a Cashless Society

Cash is still here, but maybe not for long. Although the demise of cash has been prophesied for a long time, the things necessary to make this a reality are starting to come together. First of all, counterfeiting has always been a major concern and it seems that the counterfeiters quickly catch up as soon as governments increase the tech to prevent fakes. Even Canada, with its new plastic money (at least in large bills for now) can't expect it to take long for criminals to figure out how to recreate their production process. So what will people use instead cash?A variety of new offerings that really started gaining traction this year have pointed to the direction that things will go. Google has been actively pushing Near Field Communication (NFC) chips into some of their smartphones lately, allowing users to pay for things with just their cell phone, which they would have been carrying anyway. Square, founded by Twitter co-founder Jack Dorsey, just announced a million business accounts. Square's explosive growth can be attributed to the problem it solves- now anyone can accept credit cards without being subject to the onerous merchant services process. Recently, a company called Dwolla (based in Des Moines, IA of all places!) looks to completely disrupt banking by offering money transfers for only a $.25 fee. Lastly, cryptocurrencies, like BitCoin are being heavily experimented with. This online only currency neatly fills the void left by the absence of cash for people who would like non-traceable methods of payments.

 

Possible secondary effects:

As currency moves away from cash, criminals will do the same. Even Bitcoin, once thought by enthusiasts to be super-secure, was allegedly hacked over the summer. It also becomes much easier to move large amounts of money back and forth across international borders, benefitting criminal enterprises around the globe.

 

4.  4. The Rumblings of Change in Education Become Deafening.

Education, as an industry, and especially in the United States, is rapidly hurtling towards massively disruptive change. Currently in America we spend incredible amounts of money on education yet return inexcusable results when our students are compared against other countries in the world that spent far less. Online education is going to grow substantially as online services continually become more individualized and focused on results.  Khan Academy recently made news securing millions in financing, as did Knewton, a profoundly promising company offering a truly revolutionary way for students K-12 to enhance their educational experience. And this is just the beginning. The opportunity cost of the United States not fully embracing new technology like e-textbooks for example, will simply become too high to ignore as countries such S. Korea take a bolder approach to the future of education. Finally, the classroom of 2012 will stop looking so much like the classroom of 1812! Also, a small but well-known and well-respected university will announce plans to completely do away with paper textbooks.

 

Possible secondary effects:

The majority of the education industry will continue fighting the inevitable digitization of learning or ignoring it completely, instead focusing on near-term budget issues and political infighting. Those that do contribute will find incredible growth and success helping students learn in an individualized and meaningful way. 

 

5.  5. Growth of Freelancing

Even though we are slowly starting to dig ourselves out of the recession and unemployment numbers are dropping, employers have realized how costly it is to reduce overstaffing. Freelance and contract work will be used to a greater extent over the coming as companies hire people to complete specific tasks. Companies such as elance.com have realized significant growth this year and that trend should continue well past 2012. The benefits of hiring freelancers and temporary workers for a company are easy to see. While job security and stability may initially suffer, this trend will also empower skilled workers because they will no longer be dependent on one company alone for their ability to support themselves and their families. Workers who embrace this change and become recognized in their fields will likely find that they are able to demand a higher per-hour wage and earn more overall than if they were tied to the salary provided by only one company.

 

Possible secondary effects:

Freelance and temporary employment agreements will become the norm. Although not in 2012 yet, but in the near future, the majority of companies will have less than 50% of their staff on long-term full-time payroll. With the widespread growth of telecommuting and ever-decreasing dependence on being physically in the office, this trend makes too much economic sense not to happen. Without the need to provide office space for the majority of their staff, companies will begin to seek smaller buildings from which to operate. This will have a dramatically negative effect the already depressed commercial real estate market and at the same time put a premium on houses and apartments that have a dedicated office in already them.

 

6.  6. Major Breakthroughs in Healthcare

A combination of more access to genome sequencing, Watson-level diagnostic tools (Watson is the IBM supercomputer that won a Jeopardy! competition against its two top champions last February and has now been re-assigned from game shows to healthcare services), and the rapid adoption of self-monitoring devices by patients will significantly drive healthcare advancement in the next year. First, genomics research and developments have already had numerous major breakthroughs recently. These advancements lead to new discoveries and this trend should certainly continue. Quickly and cheaply decoding a patient's genomic information provides a massive trove of data to mine. As this DNA library gets larger, it becomes easier and more reliable to find correlations between patient's DNA and their particular ailments, aiding in the discovery and production of better treatments and medicine. Now, add a Watson computer to almost instantaneously sift through all of the data, including patient history, genetics, and symptoms. Finally, input the data from the patient's personal monitoring device, such as a FitBit, and the accuracy of diagnosis and efficacy of the treatment increases dramatically.

Possible secondary effects:

Whenever the overall health of a population improves, there are many secondary effects.  Expect increased life expectancies, coupled with low birth rates in developed countries, to further strain already scarce resources (although the effects of this certainly won't be fully felt yet in 2012.)

 

7.   7. Crowdfunding Becomes the Way to Finance Your Startup

Economic growth is primarily driven by small business and the U.S. government is finally making a big change in how new business can get funding. Last week, the U.S. House passed H.R. 2930, the Entrepreneur Access to Capital Act, and now it's up to the Senate to do their part to pass this legislation. Traditionally, new business startups had limited options when raising money - they could self-fund, ask friends or family, or seek capital from angel investors or venture capital. Most new entrepreneurs don't have enough cash on hand to self-fund. Some can raise enough to get started from wealthy friends and family, but that isn't a viable option for most. Often startup founders find themselves relentlessly pitching their idea to investors, attempting to get enough funding to make that idea a reality. Then, Kickstarter came along and started to gain major traction. Although primarily used to fund artistic projects, the Kickstarter model proved that thousands of people are more than willing to micro-fund a wide variety of ventures in exchange for a gift, or early product. But it was not possible to invest if you are given equity in return for that investment. Now, the "crowd" - anyone and everyone - can invest in a new business in return for fractional equity.

 

Possible secondary effects:

If H.R. 2930 does result in the ability for entrepreneurs to raise capital from crowdsourcing, it should lead to the incredible growth in the number of new companies being started. It will also signal a dramatic shift away from venture capital and angel investment, although money to fund your new venture isn't the only reason to seek the help of an investment professional.

 

8.  8. Tablets Sales Growth Continues, iPad3 Breaks Records, We Get a New Amazon Tablet and Google Makes Its Own Android Tablet

Although the continued growth of tablet sales may seem like a no-brainer, this will have profound impact on personal computing in the future. The mass migration from PC's to tablets will strengthen our reliance on mobile devices as well as our expectation to be fully connected anywhere. Already disruptive in 2011, tablet sales in 2012 will dwarf those of 2011. With the release of the iPad3 and possible an 7" tablet from Apple, as well as an updated Kindle device such as thinner, faster Fire model, consumers will find it hard to make a case for buying a laptop instead. New 7" Android tablets will provide a highly competitive offering at less than $200. Netbooks sales will continue to evaporate and become a non-issue by the end of the year.

 

Possible secondary effects:

As tablets and smartphones completely dissipate the need for us to use a PC when conducting business, playing an on-line game or watching a movie, our perception of a computer will continue to change with it. This will ease our transition to future smart devices such as wearable smart devices and vision-integrated augmented reality.

 

9.   9. Heated War for Online Movie and TV Streaming Gets Hotter

In  In 2011, we were just starting to see the beginning of the war to provide customers with online video streaming content. Huge companies such as Netflix, Blockbuster, Hulu, Amazon, Apple, and Vudu are all in the ring and there is still no clear winner. Netflix, once the considered the clear leader, had some major setbacks in 2011. Both Amazon and Apple are using their own hardware to drive sales content revenue. As DVD (and Blu-Ray not far behind it) continues its ride into a VHS-like sunset, this war will grow even fiercer. Smart TV's will also have an impact, bypassing the need for cable companies and gaming consoles alike. Expect Hollywood studios to play a major role here as well, as streaming cuts into their profits once earned by physical media sales.  Streaming content will continue its fast growth, with so many top-level companies trying to push content on us, web-enabled TV, better viewing available on mobile devices now, and potential problems with the post office causing slower delivery for physical discs from Netflix and Blockbuster speeding that growth.

      Possible secondary effect:

      Due to the significant cost of licensing content from studios, especially as they lose revenue from the sale of physical media formats, it will be difficult for there to be more than three or four big companies which is why we should expect consolidation in the industry.

 

10.   Major Improvements in Consumer-Level Computing

Our computing device in 2012 will start showing a noticeable bump in performance as a number of huge technological advancements are released into the wild next year. Stacked 3D chips, long talked about and now finally commercially viable, both greatly reduce power consumption and increase speed by a significant amount. They will start making their way into servers, laptops and desktops when Intel introduces their 22-nm Tri-Gate chips into their Ivy Bridge line of products next year.  The results from this could be dramatic, especially as they work out how to get closer to the 10-nm level which allows for faster processing and uses much less energy. Also, in 2012 we will see the first introduction of quad-core smartphones. These devices will be better optimized to handle the new faster 4G networks, and together with improving GPU capabilities, provide a better high-definition video experience. Users can begin playing games on their devices that were previously only possible on gaming consoles and voice-activated device software, like iPhone's Siri, will be optimized to best take advantage of this massive increase in processing power.  Although dual-core smartphones are still relatively new (even by consumer tech standards) recent breakthroughs will bring these power-sipping and ultra-powerful chipsets into our hands in the coming months.

 

Possible secondary effects:

As our handheld devices continue to improve in their abilities faster than our software demands do, people will have less and less of a reason to purchase a laptop or netbook (which were already well on their way to extinction even in 2011) and instead turn to smartphones and tablets for the majority of their computing needs.

 

      11.   Your 1080p 3D TV Won't Be That Cool Anymore and Neither Will Your Non-Flexible Smartphone

Just when you got comfortable thinking you had the latest and greatest in display technology, a wave of new displays will start hitting consumer markets that make your flat screen look less than cutting-edge. OLED's, which have been on the market for some time now, but only in smaller screens such as smartphones, will make a big jump to 40" and possibly larger screens in 2012. OLED's have a number of technical advantages of LCD's and plasma's, but the main factor that will drive sales is their incredible picture quality and ability to display pitch black, unlike LCD's. QHD and 5K projectors will continue that trend, although we won't likely see those offerings in 2012. Mobile smartphone displays and form-factors will forever change with successful launch of Samsung's Flex phone. In 2012, smartphones will start to look radically different from last year's models for the first time since the iPhone came out in 2007 and revolutionized the smartphone form factor and user experience. Using their much talked about AMOLED screens, Samsung has already announced a flexible phone for next year. Ultra-thin and with a bright display, a flexible, bendable mobile device will change our expectations for what a phone can do which, ironically, won't have much to do with actually making calls . Users will be able to take advantage of the device's flexibility to suit their current needs. For example, the phone could be bent in a certain way to improve the experience of reading an ebook, or moved into another form when gaming.  

Possible secondary effects

As smartphones stop having a static form factor, we will more easily transition into using other newer devices that don't look like "computer" or "phones."  This flexible display technology will finally spill over into tablets and other form factors, maybe even the long predicted flexible display shaped like yesterday's news paper.  As the technology gets better, our devices will become more natural to use, and even more integrated into our everyday life.

1    12.  Numerous Major Disasters With Unpredictable Consequences

With the effects of climate change arguably getting stronger, it should be expected that we have at least one major disaster somewhere in the world in 2012. It is also quite likely we will experience a large number of disasters around the globe. Now, I'm not talking about the much-referenced December 21st Mayan Apocalypse here, but 2011 has seen so many catastrophic events, it's only fair to think we'll have more of the same next year. This is hardly a risky prediction, but it is important to consider the implications of catastrophic disaster. With today's global economy, one can certainly imagine significant supply chain disruptions and major human toll in virtually any scenario. This is one trend I would love to be wrong about! 

 

Possible secondary effects:

Since we usually have little to no advance warning before disasters occur, it is impossible to predict where or what specifically be affected. As disasters seem to become more commonplace, new detection and mitigation technologies will certainly become more prevalent and important to societies around the world. Through increased and improved monitoring of weather patterns, earthquakes and storms, as well as the use of super-computing to mine all of the data, we will slowly gain a better understanding of our world what to expect from it. 

 

The Heart of the Matter: The Future of Healthcare Will Be All Around Us

by Jack Uldrich and Simon J. Anderson on 11/28/11

Jonathan Rothberg, a life sciences technology pioneer and the CEO of gene sequencing technology company Ion Torrent, has claimed that sometime in 2013 society will have the ability to sequence a human genome in under two hours for the relatively bargain price of $1,000. To put this in some perspective, it helps to consider the first human genome project was completed in 2001 for the sum of $3 billion dollars. The project has already had major implications for the healthcare industry and the way we prevent and treat disease. Alas, fast and inexpensive gene sequencing is just a small part of the incredible changes that have already started occurring in the field of healthcare.

By the beginning of the next decade, in addition to the developments in genomics, continued advances in information technology, biotechnology, nanotechnology, robotics, data mining, artificial intelligence, sensors and social networking will have transformed the face of modern medicine. What follows is a scenario involving one individual with a single ailment.

On October 21, 2020, Roger Martin, a 67 year-old unemployed attorney, suffered a massive heart attack while tending to a small plot of land on an urban farm in a once thriving suburb of Atlanta. Had the event occurred 10 years earlier, Roger would not have made it to the hospital alive.

The first sign of impending danger came when sensors in Roger's shirt detected an unusually high pulse. Unbeknownst to Roger his shirt sent a wireless alert to his "PMD" (Personal Mobile Device) so it could begin more closely monitoring his other vital signs. After noting his symptoms, it compared them--along with his medical history and genetic file--to its vast database of all known diseases and injuries. Among the possible causes were a number of serious conditions so it also contacted his primary physician, who immediately contacted Roger via mobile video connection.

"How are you feeling, Roger?"

"Fine," he replied, "maybe a little tired but nothing out of the ordinary."

Seeing that Roger looked a little pale, the doctor asked him if he had his permission to activate a mesh network of nanoscale diagnostic chips that had been placed inside Roger's body following his first heart attack in 2017.

"What if it's another false alarm," asked Roger, who had been contacted by doctor in response to a similar situation last year.

"I can't be 100 percent it isn't," replied his doctor. "The technology's still far perfect but I don't want to take a chance. Do you?"

"No, but are you sure the signals from those little nanobots won't do more harm than good," asked Roger, who was still nervous about the chips efficacy after hearing various reports from bio-health some news organizations hinting at the possibility that activated chips could be contributing to the recent rise in reported cancer cases.

"The rise in rates has nothing to do with the chips themselves," said the doctor, "and everything to do with our ability to detect cancer at an ever earlier stage. If you need further evidence," continued the doctor; "I suggest you query your personal assistant (which was actually just a sophisticated algorithm) on your PMD. It'll confirm your worries are nothing more than an insidious urban myth. I can't believe it still persists in this day in age."

Moments later, after gaining Roger's approval, the network of nanometer-sized circuits patrolling Roger's arteries was activated and began sampling his blood. Within seconds, the doctor was aware that the level of C-reactive proteins in Roger's blood was abnormally high.

The doctor's voice took on a more serious and ominous tone. "Roger, I want you to sit down, stop whatever you're doing and take a deep breath." Roger did as the doctor instructed.

"Now, I want you to remain calm—and please know that I'm going to be with you the entire time--but there's an 80 percent probability you're on the verge of having a serious heart attack. The nearest hospital has been alerted and an ambulance is already on its way."

"You're kidding, right? I'm just feeling a little tired. All I've been doing is working outside—getting some fresh air and exercise like you suggested."

"Just relax, Roger. Over the last few years, I've come to appreciate the computer's ability to more quickly and accurately diagnose healthcare-related issues than either I--or my patients--can. Plus, better to be safe than sorry, right?"

"Yeah, I guess," replied Roger pensively as his breath became more labored. In an attempt to lighten the mood, he added, "I hate to think what this will do to my insurance rates."

By the time the ambulance had arrived, Roger was happy it had because he had begun to feel constricted in his chest. Then, only moments after being placed in the ambulance, Roger went into full cardiac arrest. The paramedics were prepared and followed the new protocol established by the American Medical Association only two years earlier.

Normally, Roger would have been taken to Emory University hospital but due to traffic congestion and the severity of his condition, the ambulance was rerouted to an outpatient clinic located just off the freeway. Once there, Roger was whisked away on a gurney to a "clean" room where he was anesthetized and prepped for surgery. Then, in a procedure that would have been all but unthinkable even five years earlier and which was only approved the previous year by the Food and Drug Administration for emergency situations, a robotic surgical device was wheeled into the room and positioned over Roger. With only a nurse and a young attending doctor in the room, a heart specialist located in Havana--connected via a secure, redundant fiber-optic internet connection--began guiding the thin, flexible arms of the device through the intricate surgical procedure using nothing but hand-gesture technology.

When the surgery was completed just 23 minutes later, all that was visible on Roger's chest was a band aid-sized incision where the robotic arm had entered his chest cavity to insert a temporary stent.

Roger awoke a little later and was greeted by a split screen display showing both the heart surgeon and his primary physician. "You're lucky to be alive," said his doctor. "I'd now like to introduce you to the person responsible for extending your life, Dr. Daniela Famosa. Under the recently passed International Health Services Act, she was able to perform your surgery from Cuba." Roger smiled and nodded in her direction.

"During the operation," said Dr. Famosa, "I harvested some of your stem cells and, with your permission, I'd like to have them transferred to the Institute for Regenerative Medicine at Wake Forest University where they will grow you a new, fully compatible artery. If all goes according to plan it should be ready in a few weeks and can be inserted sometime the week before Thanksgiving. Based on your personal health record and history of patients with similar health background to you, you should be able to travel over the holidays if you so desire."

"You'll have to stay away from the eggnog this year," added Roger's doctor with a wink.

Later that afternoon, Roger was discussing his outpatient treatment with, "Cindy"--a computer animated avatar that resides on his PMD and acted as his personal nurse. The avatar was responsible for continuously monitoring his health status in addition to scanning the latest healthcare information in order to recommend and deliver Roger the best possible care.

"Based on your genetic profile and the presence of the following genes—SMAD3 and CXCL 12," said Cindy in a smoothing and reassuring voice, "we know that the blood thinner Warfarin--Type C3 will be best for you during this interim period. It's also recommended that you not take it with any of the other following drugs." The avatar went to list those drugs that Roger was to avoid, including the new anti-depressant he had been prescribed. (In early 2020, the FDA was forced to pull the leading electronic brain stimulant treatment for depression.)

"I realize this is a lot of information for you to process. Don't worry," continued Cindy, "I'll remind you not only when to take your medication, but I'll advise also you what other foods and medications you should avoid." In a tone that then offered just the slightest hint of admonition, the avatar then added, "When your heart is ready, we'll also do a better job of keeping you on track with your exercise regimen." Roger voiced his approval.

"Are there other questions can I answer for you," queried Cindy.

"Well," said Roger; who, in spite of avatar's growing popularity the past few years, was still a little surprised with how natural it felt to be conversing with a virtual nurse, "Could you tell me a little more about the how the doctors are going to grow my new artery and install it?"

"Sure." Cindy promptly called forth the 3-D digital scans of Roger's heart and showed him the blocked artery that had been colored-highlighted for his convenience. The avatar went on to explain how plaque, fatty substances, cholesterol, cellular waste and calcium had been slowly building up over time and was the main culprit of his heart attack.

Once Cindy was confident that Roger understood the cause of his heart attack--which she figured out by using facial recognition technology to scan his physical reaction to the information that was being presented--she went on to show him how his new artery would be grown. Cindy called up a short video tutorial produced by the Institute of Regenerative Medicine that demonstrated how a small scaffold would first be constructed using bio-friendly material and a 3D printer and how that scaffold was then seeded with Roger's own stem cells and cultured until an artery replacement of the precise proportion was grown. "There's virtually no chance your body will reject the new part," said Cindy. The avatar then explained other treatment options to Roger along with the costs and benefits of each procedure. "I'm happy to arrange a conversation with a doctor if you have any additional questions, but I recommend the replacement surgery."

Roger asked Cindy a few questions regarding his insurance coverage and what costs he would be responsible for but once he was satisfied with those answers, he indicated he didn't have any additional questions. The avatar then began preparing Roger for outpatient services.

"The first thing we'll need to do is outfit you for a new line of external sensors. Your current clothes are pretty good but as an extra precaution we'll want to keep extra close tabs on you during your recovery period." Continuing Cindy said, "I have also taken the liberty of putting together a list of friends and colleagues who have either had heart attacks or have lived with someone who has had one." Knowing that Roger was the type of person who responded better to scientific information, Cindy added, "Past heart attack patients who have joined health networks are 37 percent less likely to suffer a repeat heart attack within the next five years. They also experience an increase in life expectancy of 2.8 years over those who don't." To make the point more vivid, Cindy also displayed the information in a visually compelling format. She then added, "A good way to use your network is to enroll in "Healthy Hearts"--your insurance provider's new game to encourage an active and healthy lifestyle. It's even possible your rates could go down in the future if you score above the 85^th percentile."

Two months after his successful artery replacement surgery, Roger received a small 3-D model of a human heart when he refilled his personally tailored heart medication prescription. It was a discount offer from a new biotech company that had only recently begun growing and marketing human hearts. Roger activated the chip inside the model that then displayed an advertisement on this PMD. The ad read: "It's not soon to begin thinking about your next heart. You can never know when you'll need it but it sure 'beats' the alternative."

Roger then called up Cindy and asked her what the odds were that he would need a new heart by the year 2030.

"If you continue to follow the recommended therapy and exercise, 42 percent," replied Cindy. "Just as an FYI, due to your projected increase in life expectancy, the odds of you contracting prostate cancer have also increased. But don't worry, I'll keep a close eye on all the indicators and notify you if anything is spotted."

"Thanks." Roger turned back to his PMD and directed his personal assistant to revise his finances so that he could be assured he could cover that portion of the cost of a new heart that the federal government didn't cover. 

The Future of Higher Education: A "Cloudy" Forecast

by Jack Uldrich and Simon J. Anderson on 10/12/11

In 2002, the Massachusetts Institute of Technology (MIT) began offering all of its undergraduate courses available online for free. In 2008, Straighterline - an online university - provided students the opportunity to obtain a college degree a cost of $99 a month. In 2009, Trina Thompson sued her alma mater, Monroe College, for $72,000 because she was unable to find suitable employment after receiving a four-year college degree. In 2011, a nationally touted study claimed 45 percent of college students couldn't demonstrate any increase in knowledge after their first two years of college. Later in the year, The University of the South became the first college in the nation to voluntarily decrease its tuition. It dropped the price by $4,600 - or almost 10 percent. Tuition was still $41,400 a year.

 The above examples are anecdotal but point toward larger structural change in higher education. How knowledge is being disseminated and shared is shifting, the demands and needs of students are changing, learning habits are in flux, and by necessity (albeit slowly) new educational business models are emerging.

 Below is a fictional encounter between Megan, a mature-for-her-age high school senior, and her father, a factory line supervisor. Their conversation offers a peak into the cultural, behavioral and technological changes that have affected higher education in 2020:

 "Are you nervous, Honey?"

 "Not really," replied Megan.

"Well then open it," said the father referring to the notification she just received on her mobile device. It contained a secure link to the results of his daughter's Secondary Education and Vocational Propensity Evaluation, or "SEVtest" - as most students called it.  

"I don't know why they couldn't have just provided me the results as soon as I finished the exam. I mean the test scenarios continually adapted based on my responses and I'm certain the program had my results immediately after I finished. Maybe it's a psychological thing... an institutional leftover from the days when your SAT or ACT scores arrived by mail."

"Just open it," prompted the father, "this is your ticket to a better future."

Megan rolled her eyes. "No, it isn't, Dad. At best, it will help me understand where I should focus my energy. And besides, many of the careers suggested by the test won't even exist in a few years!"

"Please," replied the father in a tone suggesting his paternal patience was being tried, "open the link." Megan nonchalantly did so and absorbed its content. She showed no emotion.

"Well?" asked the father pensively.

Megan showed him the results and he embraced his daughter in a big hug. "Top Placement Status! You did it!  I'm so proud of you." Excitedly, he added, "It even lists "Veterinarian" as one of your top career aptitudes - remember how you always talked about working with animals as a girl? So what are thinking? Harvard? Stanford? Northwestern? Maybe Colorado State or Minnesota for vet school? You can pretty much write your own ticket!"

Megan said nothing. Following a long pause, she then said, "You're right, Dad, I can write my own ticket." 

"That's the spirit!"

"No, Dad, I am really going to write my own ticket. I'll be doing my studies at 'Cloud University'."

"Cloud University?" replied the father in a confused tone. I thought taking classes that way was just for students who didn't have any other options. You could go anywhere with your scores!"

"Haven't you been paying attention to the news, Dad? Regular degrees from regular schools don't work anymore. Traditional universities are lame... I want training to succeed in this rapidly changing world of ours. Most of what you 'learn' I could find out in seconds in the cloud. I need training to know how to use the vast resources that surround me, not useless facts to memorize. I'm going to put together my own degree from the millions of excellent and free courses now available - and I intend to help others do the same."

"Megan, that's not a serious option. How could you waste all of your hard work just to study online? I mean why would you even think..."

Before he could go any further, his daughter cut him off. "Look, Dad, I've already received almost a year's worth of college credits by taking Advanced Placement (AP) courses online." 

"I know and I'm proud of you but you went to school to do it." 

"Only partially true - my French and advanced calculus courses were online because my high school didn't have qualified instructors but I could have just as easily taken my English and chemistry courses online." Continuing, Megan said, "It might also interest you to know that the reason I performed so well on the SEVtest is because I used test prep software online program that trained me how to think in a way that would help me give the types of answers the test was looking for, not because I studied endlessly about facts. The classroom-only learning mentality should have disappeared when the personal computer was invented. I'm telling you, it's a waste of money to spend tens of thousands of dollars a year for a traditional education. Plus, who made the rule that four years is somehow the optimum - or magical - length of time to acquire knowledge?"

"But who'll hire you without a formal degree?"

"Accreditation isn't the answer, Dad. It's the problem. Every year millions of college students graduate and are unable to find good-paying jobs because they aren't prepared. What employers care about now is how well you perform on their own competence and aptitude tests or how well you do in one of their 'learn-at-work' programs. Schools aren't preparing students for either one."

"That's not the school's fault."

"Yes it is, Dad. Most of them are still in the business of providing average students an average education. The degree is barely worth the piece of paper it's printed on. Most people are just buying an old stale brand that has outlived its usefulness and no longer provides much in the way of nutritional value. Most universities do little to equip you with the skills that really matter - like intellectual curiosity, adapting to new knowledge, innovative thinking and creative problem-solving." 

"That may be, but with your scores you can go to a prestigious university. Think of the connections and contacts you'll make?"

"True, but at what cost? And, it won't be those schools that make me a success. I'm responsible for my own success and I can educate myself for next to nothing."

"But how will you get a job? I wouldn't hire someone without a degree."

"Many entrepreneurial employers are no longer impressed with a mere diploma, Dad. They want you to demonstrate knowledge - not show them a piece of paper that cost you or your parents a hundred grand." 

"But..."

"Look, Dad, how many times have you changed jobs this past decade? Five? Six?"

The father nodded his head in agreement.

"And all of those jobs you lost because you were either replaced by automation or because the career you were in basically ceased to exist due to advancements in technology, right?"

"Yes, but that's because I didn't go to college and didn't have a degree. If I did, I wouldn't have been in those lower skilled jobs to begin with! That's exactly the fate I want you to avoid." 

"No," replied Megan softly, no longer looking him in the eye, "It's because you weren't able to adapt fast enough and couldn't demonstrate an aptitude for acquiring a new set of skills quickly. The future is only going to accelerate the need to adapt. New technologies and new industries are emerging almost overnight now and, in their wake, they're leaving jobs - not to mention entire industries - in their dust."

"This is my future, Dad. I'm going to have to survive in a jungle where I'll have to swing from branch to branch every few years - or maybe even months - in order to get my next banana. More likely, I'll have to create my own branch and grow my own bananas. What school is preparing students for this future? What good is a degree for a skill, a job or an industry that no longer exists"

The father was silent. 

"I'll tell you, none!" After a pause, Megan then backed off the statement. "Look, Dad, I'll admit that some jobs still require a degree from a traditional university. I'll also admit that some schools and some degrees are better than others. Hell, I'll even admit that many students - including some of my friends and classmates - might benefit from a traditional education. But I won't. I'm self-motivated. I want experiential knowledge because I understand I'll likely have to invent my own jobs if I want to stay gainfully employed. What I learned working with a mentor at the coding academy I attended last summer was more valuable than anything I learned my whole senior year. Plus, I don't care to sit in a huge room with lackluster students listening to a professor - or more likely a teacher assistant - who has never worked a job outside of academia in her or his life, talk about skills that were only useful in a job environment that existed a decade ago."

"But what about the social aspects of college?" asked the father. "One of the most important things you learn in college is how to interact with different people."

"Really, Dad?" said Megan in a sarcastic tone. "You want me to go into serious debt so I can learn how to interact with people? In case you haven't noticed there is this little thing called the Internet that has been around since I was born and I use it to stay in touch with friends and connect with new ones - as well as potential employers."

"I don't know, Megan. Your plan is so risky."

"What's really risky is spending $100,000 with no guarantee of a good job at the end of college.' Megan then paused before adding in a more conciliatory tone, "How about we compromise?"

"I'm listening," said the father.

"Here's what I'd like to propose. I want to pursue an entrepreneurial venture at the same time I'm studying. If I haven't learned enough to allow me to earn a living and move out of the house by the time I'm 20, I'll enroll in a traditional school."

"What exactly do you have in mind?"

"I'm glad you asked. It might please you to know that some friends and I are already developing a new mobile web application that delivers customized educational lessons to other motivated self-learners. We then plan to market the technology to employers who need to upgrade the skills of their employees in order to stay competitive."

"And who are these friends of yours?"

"People I've gotten to know through various networks," replied Megan. "I met Paul when we helped tutor each other. He helped me with my French and I helped him with his English. We started talking and we both believe there is a huge market for educational tools to help people like ourselves - motivated self-learners - so we reached out to a few other like-minded people."

"To make a long story short, we've partnered with Ajay, a programmer in Bangalore, who has developed an algorithm that rapidly searches video databases and creates a customized learning experience utilizing those clips which have been rated the highest by past users.  If necessary, the program will translate the videos into the student's native language. Tobius, another programmer in Norway, has developed an educational assessment tool that further tailors the information so it is delivered in the format most appropriate for the individual. For example, depending on whether the person learns visually, auditorially or kinesthetically - or some combination of the three - the program delivers the lesson plan that will be best understood and absorbed by the student. My friend Paul is working on a related program that uses voice and facial recognition technology to determine if the person is successfully processing and absorbing the information." 

"My role in the venture is to use my knowledge of gaming dynamics to make sure the student can't advance to the next level or learning module until he or she has either demonstrated a thorough understanding of the concept being presented or earned 'experience credits' by participating in programs, courses, lectures or activities that provide the function equivalent of traditional classes. My tool will also be designed to access peer-based learning tools as well as ensure the student is fully engaged by making the learning enjoyable and, if possible, slightly addictive - like a good video game.

"We then have another teammate - Maria, a data-mining guru, from Sao Paulo - who is using publicly available data to identify other self-learners who we'll then market our technology to. She's also working on a related program to help identify employers who might use our services."

The father was astounded at the breadth and scope of the plan. Finally, he mustered up a follow-up question. "And how do you intend to finance this venture?"

Without missing a beat, Megan said, "We're crowd-sourcing it. We've already lined up $150,000 in micro-loans from an assortment of people around the world."

The father just shook his head and laughed, "And when will a learning module be available to help middle-aged men cope with all this change be ready?"

Megan just smiled. "You'll be fine, Dad. Just remember the future of education isn't learning about something, it's about learning how to fluidly adapt to change. And it's definitely not about going to a place to get 'educated,' it's about accessing and customizing the ocean of knowledge that already surrounds us in 'the cloud'." 

The Gamification of Business

by Jack Uldrich and Simon J. Anderson on 08/18/11

Yesterday, MIT's excellent publication, "Technology Review" posted an article discussing how businesses and other organizations are finally beginning to realize the benefits of gamification. In case you're unfamiliar with the term, it generally refers to the use of gaming dynamics in a variety of everyday situations to help elicit certain reactions or responses from participants. Humans are psychologically programmed to respond to these gaming dynamics through our natural need to achieve and compete. By making a "game" of many important tasks, businesses can expect a much higher and more engaged response from both their employees and their customers. Services such as foursquare and SCVNGR illustrate how popular the gamification of everything from going to dinner to even running errands, has become.

But this isn't just about about earning badges or points anymore- an organization in the UK projects savings of roughly 30 million by 2014 in one department alone just by employing gaming dynamics to reach some of their goals. And this is really just the beginning- gaming is becoming a part of our everyday lives, and in ways that we don't even realize.

Click the following link to read the article and find out more about how organizations and businesses are using gaming dynamics right now with huge success. Link: "Using Games to Get Employees Thinking"

Gamification is going to be such a powerful force in business and marketing, Jack Uldrich and I have even included it as one of the major transformational trends shaping the next decade in our forthcoming book "Foresight 2020." To read an excerpt on how we think gaming dynamics will affect your everyday life in the near future, check out an excerpt from the book here.