HOW WILL ADVANCED TELECOMMUNICATION CHANGE TRADE?
Risto Linturi
Ladies and gentlemen,
During prehistoric and historic times man has not changed biologically. A continuous development has been caused by information and knowledge that mankind has harnessed in the form of various technologies.
Much of all development has happened in bursts. Napoleons armies moved slower than Caesar’s armies. Caesar had much better logistics - he had roads going from where he was to where he wanted to go. Napoleon still used Caesar’s roads but they very often did not go where he wanted.
Suddenly, just one hundred years after Napoleon, trains fared all across Europe with speeds over one hundred kilometres per hour. We got telegrams and public transport. It was much harder to get huge profits from trade but very much easier to profit from efficient production.
Our postindustrial age has shifted power from industrialists to investors. Rules are changing again. More and more of the value in products and services consists of bits. Their production cost and distribution cost is almost zero. This means that if you are second best, you get nothing and you cannot even go anyplace else because the network delivers bits everyplace. The only way is to differentiate. This shifts power to those who are creative and those who are sensitive enough to feel what others would value. Look at the movie industry. Power has moved to Lucases and Spielbergs from those who had the production studios or distribution channels. Look at Nokia. Actually Nokia is a big design studio and others mostly do the industrial production and distribution.
Quite soon practically anyone can get near tv-quality picture from internet and more important: anyone can also broadcast this same quality to everyone else. Imagine what happens to mass media budgets if all products can be advertised on their own channels with just peanuts. Virtual product demonstrations will be always available. Channels no longer own their audience – advertizing has to become interesting in itself.
All this means that there is less and less work for the middleman. Naturally there is always work for those who add value and whose work is appreciated. But you well know that this does not well describe most middlemen.
Virtual reality technologies will enable us to see what we wish whether based on physical reality or not. This will give us better methods to control and be informed of our surroundings. Simultaneously it gives us pleasant virtual friends and environment, which tries to lure us away from the reality. Future society will be divided between those living in physical reality and those mainly concentrated in imaginary, perhaps addicted to individual computer created environments.
By the year 2010 I think all the world has been modelled accurately and modelling techniques have been automated. Physical reality and virtual reality are being connected with GPS-positioning devices, cameras and geographic information databases. Soon minds can travel and meet with others in lightspeed.
Many logistic problems will also be solved much more efficiently than before. If you want a taxi you just open the virtual city and pick the closest free taxi with your mouse. The taxi gets your position and your order immediately and automatically.
But this is not trade - this is just citizens being able to control their own lives and their own environment. Similar examples arise everywhere - technology helps us in our everyday lives and trade should ease this development. It could also benefit from this development. There are many possibilities for reorganising the delivery systems when everybody can locate everything. When vehicles are able to move by themselves. Just think about all those street signs and traffic signs. They are already in databases. You could see them in your virtual windshield or when walking you could see them in your mobile. We could as well remove the physical versions completely and save taxpayers money. It will become very scarce anyway after all these changes. Electronic services actually replace products.
Let us think awhile about the society overall. You all know that there was a very big change in trading when the communistic system crashed. It is easy to see that they had a system. It is much harder to understand that we also have a system, which might collapse.
A state is a power structure, which is financed by collecting taxes from exchanges inside the states boarders. Future bit realm will be economically very important but it will not know any physical state boarders. Nobody knows when I find someone’s homepage and solve some puzzle they had there and get electronic money for what I did. They did not know me and I did not know who paid me and which country they were from. Rules in network realm must be global in order to be enforceable and many rules will require impossibly hard measures. This leads to weakening of states and creation of a world bank, a world police and finally a world state. In the meantime bit realm resembles a strange mixture of Wild West and feudal age structures with virtual disney worlds in every corner.
With advanced network interaction it should be noted that we are creating possibilities for criminals. If we create a network and a virtual reality where anyone can send other people blackmail letters, where anyone can threaten to spoil your personal or corporate reputation, where anyone can publish any copyrighted material or corporate secrets without any risk of getting caught - then it is bad. If we create a network where these same criminals are able to commit their crime and even collect their money without any risk of getting caught - then we have created a monster. Currently we are doing just so.
In the physical world we have faces, our cars have license plates, our money has numbers. Even the smartest criminal has a risk and this should also be the case in internet - otherwise we cannot rely on our networks.
Information and communications networks speed up all development. Networked society seems to favour different values from industrial society. Current western hedonistic values can be expected to give way to a new rise of community values as networking continues. Partly this is caused by increasing transparency and ease of non-hierarchical communication between all people. This causes privacy to decrease to the level that used to be customary in old villages. If you are a bully people are afraid to trust you and in internet the rumours spread very fast. Also good rumours spread and a good reputation is worth very much because it helps you to get networked.
Many people say that brand will become very important in networks. But I think that this is not so simple. Look at what happened to Mercedes Benz when their car toppled. Good reputation gets stained easier than ever if there is a real reason. New competitors can also came out of nothing. Think about Tamagotchi. Every kid all over the world heard about it within three months without any advertising. Ease of communications between users themselves changes all marketing rules. Good products and good services are much more important than good but empty brand.
In the future we will live amongst all sorts of gadgets. Just imagine putting a small internet camera inside your fridge. When shopping, you open your GSM mobile communicator and call your fridge to see what you need.
We already wear our mobile phones almost to bed with us. Soon mobile phones will replace our wallets and our calendars. Next they will be integrated into our head. Microphone will be connected to our nervous system and loudspeaker to our ear. Speech synthesiser will replace our voice with the voice of Elvis and we can speak with anyone anywhere silently so that no-one notices. This used to be called telepathy and now it seems to finally have been invented. Subvocalised thoughts can be directly transferred to other peoples minds without a sound. This might be a very good way to avoid spying.
Regular microphones will store everything that is spoken around us and computer indexes it and recalls everything like search engines find everything from the internet. Later our eyes will be replaced so that they will see in dark and zoom like new digital cameras and they also will store everything. They will remind us when we meet someone we should know and whisper latest rumours to our ears.
Our skin starts to produce electricity and our blood will be replaced by much more efficient nanoliquids. There is no limit to how long we can live if all of our parts can be changed.
Genetic technology will destroy many of our current structures. Lengthened life cannot be enjoyed by everybody because of scarceness of resources and population pressures. Genetic technology will also be used to alter our physical appearances, to enhance human capabilities and to destroy other humans. All these will greatly affect our everyday lives, values and goals. Genetically engineered products and ever cheapening digital technology will be the first technologies to greatly affect everyday life also in the third world countries. This will not happen without catastrophes.
But onwards - Let us look at how we will interact with our machines in the future. Think about the home computer when it has a camera. Then the camera can see you. American pilots have a system where they look at the other plane coming nearer and when they sneeze the missile is sent on its way. I heard that Microsoft is designing similar system for their wordprocessing. You just look at the word and it disappears or changes if you dont look satisfied.
You know from movies that computers can create very good human images. Consider that commercial mailings in the future contain programming. The advertisement you are reading studies your facial expressions and your eye movements. It changes the music to suit your interests. (oh do you know that big foodstores nowadays change music to the lighter if they have too much fish left) But this advertisement suddenly changes into a face so intriguing that you must smile to it, then it faces you directly, looks you at your eyes and smiles back. It says: “You do like this dont you, but you liked yellow colour more - lets change it to yellow - now it is much better. Then you might enjoy this little game for the kids as a side present -- yes you are interested I can see. Now if I reduce the price by ten percent - for you only - would you now accept the offer, please nod now, please nod now - yes. I taped your order and the equipment is coming via courier service. I took money from your electronic wallet already. Very pleasant to meet You. Goodbye.”
Virtual reality can be very addictive also. I told my first stories about virtual reality and addiction in late 1979. My latest book has got a story about very high tech but very tight living quarters for the elderly. Before you hear it you must realise that today one third of american population or actually one third of everyones wake up life is spent looking at the television. Brain studies show that mostly nothing happens in our brain when watching the tv. Not learning, not relaxing.
TV is very often just a socially acceptable way of turning yourself off for the time that you are not necessary. There are exeptions of course but basic target of a tv-program is to make you addicted to it and passive enough that you stay sitting through the commercials. But now to the news from 2020.
“The number of living dead has exeeded the number of physically dead for the first time. According to the europe union officials the number permanently connected to virtual reality exeeded 9 million last year.” The story follows with interviews from institutions specialized in terminal care.
We will be immersed in information and ever increasing number of gadgets which talk pleasantly with us, which continuously listen and watch how we behave and react. These devices will manipulate us, therapy us and become our friends while moving the lawn, cleaning our house, doing shopping and going to work to earn us living. And naturally they drive our flying cars because that is too difficult for humans to do.
Automation, virtual reality addiction, enhanced and altered humans and cyber terror will put a major part of humans in front of fundamental questions. Answers will be searched among others from cult movements, philosophies and religious fanaticism. But that will take over ten years. Within the next five years we will have to deal with electronic cash, virtual counter services, disruption of media marketing and destruction of many middlemen who want to keep their posts. And we have to cope with every electronic device getting old faster and faster
Those who are creative will get free publicity for their products. Good and satisfied customers will reward you much better than ever before because word of mouth spreads so much faster today. It is once again important to concentrate on real quality with less concentration on marketing. And the quality is defined by what interests the customers so much that they will tell about it to others.
I hope that these bits and pieces created a turmoil in your head. There will be big changes because we are living in turbulent and fast moving ages. Always when economy shifts this much most of the old companies fall down to give room for new ones. Some old companies are always agile enough and believe strongly enough that the future is a frontier with great opportunities and not just threats. I hope that you will embrace the change and never underestimate the power of change by calling it development. Wealth creating methods never develop or evolve. They are invented.
Ladies and gentlemen, thank you for your attention.