Monday, April 30, 2007

Get a (Second) Life!

Businesses should devote serious thought to creating a virtual world strategy (and perhaps learn from cats)

"Virtual worlds" such as Second Life hold out a promise that is dramatic, liberating and irresistible to most: a parallel, electronic world where people can conduct their lives unencumbered by many real-world constraints and botherations. But is this promise merely a phenomenon conjured up by over-zealous marketers , technology buffs and varied commercial interests, or is it backed by true capabilities?

Let's look at some facts. Second Life, the most popular virtual world environment, certainly appears to have crossed the early adopter stage. It lists the total number of its users at a significant 5.8 Million, of which about 1.78 Million are active users.

More importantly, many leading companies have got together a Second Life act. Adidas Reebok , Nissan, Mazda, Toyota and Starwood Hotels are all deeply engaged in Second Life initiatives. Dell sells PCs there. IBM, Sun are active. IBM CEO Sam Palmisano visited and held a meeting in second life recently. The company has reputedly even set up a business group t o address Second Life forays. Reuters has a news bureau in second life. Harvard Law School has offered a course there.

Perhaps a key sign that a technology has arrived is when governments start adopting it. The Swedish government is setting up an embassy in Second Life, thru the Swedish institute, an affiliate of it's foreign ministry. The City council of Manchester, UK has taken a few Second Life islands .

All is, of course, not hunky-dory. Numerous observers have counseled caution on various grounds. There is a need to look at success metrics that go beyond usage numbers. A very down-to-earth caution is that the products and services that real world companies can offer may appear mundane in the context of the fantastic, imagination-stretching possibilities that seem easy in cyberspace. In an environment where people seem able to jump tall buildings, air sole shoes can hardly be termed as exciting.

Nevertheless, a virtual world offers people enormous possibilities to break out from real world constraints and do things impossible in the real world. With increasing familiarity and access to technology, people will welcome the chance to use this new-found freedom in realizing their potential in ways that they could previously only imagine. Even more fundamentally, it is not inconceivable that many people will see this as an opportunity to create from the ground up, a new identity that they always wished for but could never have in real life. Thus it can safely be expected that virtual worlds such as Second Life will see widespread traction and uptake from people of all ages and persuasions. The sociological ramifications of such a blurring between the real and imaginary worlds can be staggering, but that is a subject for a different day.

So, how serious a note should businesses take of this phenomenon? Smart companies go where people go. If people are flocking towards the virtual world, then companies need to go there too. If they want to show they are tech-savvy, and get mindshare with the young crowd , who make up the market of the future. They can also actually generate revenues (sell products and services) thru this route . As with any endeavor that needs to catch people's imagination and fire up large numbers of people, first-mover advantages are obvious.

Is the road ahead paved with Silicon? While that may be overstating things somewhat, it seems clear that the lives of large numbers of people alive today will increasingly involve excursions into the wild blue yonder of worlds that exist only in computer-enhanced reality. In the meanwhile, it appears inescapable that every company worth it's salt should busy itself thinking up a Second Life strategy - even if that strategy is only an informed wait-and-watch.

The most apt approach is perhaps to be like a cat - wait and watch with great care, but be ready to jump when the time is ripe. But unlike cats, companies (and people) are not naturally endowed with nine lives, and so should welcome the opportunity to be granted a lease into a second life.

Wednesday, April 11, 2007

Hark! Did Somebody Say Eureka!?

Our track record of foreseeing technology's future is abysmal. Can we improve it?

The automatic calculator was invented in the 1950s. Mobile telephones were invented in the early 1970s. Agree?

If you agreed with either statement above, you were off by only a few centuries in the first case, and a few decades in the second. IBM, Bell Punch and Sharp pioneered electronic calculators in the 1950s, but automated devices for performing numerical calculations have existed, in concept as well as in actual physical form, since the 17th century, when Wilhelm Schickard and later Blaise Pascal built the first mechanical calculators. AT&T and Southwestern Bell introduced the first commercial mobile radio-telephone service to private customers as early as 1946. Bell Labs received the patent for cellular telephony in 1972.

Surprised? You are far from being alone. In fact, this fits what appears to be a general - and generally wrong - pattern of how we view the process of technological innovation. We tend to underestimate the time it takes for a technology to be born and gain widespread use. I call this pattern the "Creative Burst Fallacy".

But before we talk any more about the creative burst fallacy, why do we need to be aware of it at all? Knowing it is of great practical interest. In fact, this belief is one of the reasons for what I call the human race's Technology Foresight Deficit - our inability, demonstrated time and again, to correctly foresee the potential of upcoming technologies. Thomas J Watson, no less than the Chairman of IBM, opined in 1943 that the world would need no more than 5 computers. 3G, or third-generation telecommunications technologies, were projected to become the wireless communication technology of choice by the early 2000s - they are yet to take off in any big way in any part of the world. This was a costly mis-judgement indeed: ask the companies that paid billions for the rights to roll out 3G. The days of the bubble saw legions of such technologies being touted as the panacea for a wide range of business and consumer problems. At the same time, many technologies fly "under the radar", or remain unrecognized. Using these and other examples, I have written elsewhere how we can Re-engineer our Crystal Ball, or learn to look at emerging technologies more realistically.

So, Here's the Creative Burst Fallacy. The popular view of how technolgies evolve typically includes the belief that a new technology takes birth in a burst - or a series of bursts - of creative energy. The reality is usually far more prosaic. Technologies are rarely conceived in a "Eureka!" moment - the birth of a technology is typically a deliberate, painstaking and well-thought out process. Further, once having been born, most technologies spend months, or even years, before they reach a stage where they get widespread attention and use.

Then why this fallacious belief? As with most erroneous beliefs that are widely held, this one has some very good reasons for it's existence. I outline some reasons in my article, "Did Somebody Say Eureka!?", in the March 2007 issue of R&D Magazine, and show some patterns which drive how technology takes shape in reality.

Overcoming the creative burst fallacy is an important part of improving our ability to foresee emerging technologies correctly, and of overcoming humankind's technology foresight deficit.