Belatedly, but as promised, here is the SlideShare link to the Emerging Technology: 2020 presentation I delivered at the Emerging Technology Conference at ISU, as well as the Federal Consortium of Virtual Worlds conference at NDU. I will provide an annotated one in the near future as well.
There are good things and bad things when discussing the trade-off between privacy and transparency. Back in the days when I frequented many a Santa Fe Institute lecture, there was lengthy discourse about The Beer Game, which simulates a distribution system for beer sellers with knobs to allow for certain levels of transparency from retail to distribution to wholesale. The point of the exercise is to determine 'How much transparency is too little, and how much is too much'. If you don't expose your retail demand in a timely fashion, you end up having no inventory. If you expose too much, you end up 'flapping' your distribution chain with wild inventory swings.
I think back on this exercise frequently when it comes to the Internet+Social Media, and the blood/brain barrier of privacy and transparency. Should I share my trip details, or keep them private? What efficiencies (e.g. catching dinner with friends also in town) do I miss by omitting my travel plans from my blog, etc..
In this day, it's difficult to ascertain the level of data being collected about you, especially when I methodically opt-out of every data-gathering clause I find, deliberately out of my frothing libertarian paranoia.
You can imagine my surprise when I just received an automated telephone call from CostCo, a big-box retailer in the United States, alerting me that the Clif bars that I purchased 'between June and December' were possibly a infection vector in the recent Salmonella Typhimurium Outbreak. They were able to determine this based on the fact that each SKU (part number) is tracked through sale, and tied to a particular CostCo member identification number. Since they have my telephone number from the CostCo application, they were able to call me and notify me to trash the Clif bars else risk the wrath of Salmonella.
Am I happy that they warned me? Absolutely. Am I surprised that they were (admittedly well integrated and efficient) tracking my purchases to that level of resolution? Absolutely. Will it stop me from purchasing more goods at CostCo? Nope. Now I get to be tied up with this privacy/transparency quandry for a while.
What would you do? Does this type of tradeoff offend you or do you feel that you'd sacrifice privacy for this entitlement? Do you mind that Google knows more about you than your family physician? Speak up!
First and foremost, allow me to apologize for the lengthy delay since my last post. Pursuing the 'Hollywood style of work', as I do, means that my work is sometimes very busy and sometimes the opposite. The months of November and December were very, very busy.
The reason for tonight's late post is a series of twitters that occurred today surrounding a relatively innocuous Ars Technica posting. The posting concerns a 'Taxpayer Advocate' that recommended to the IRS that virtual worlds should be taxed. Other than the sheer complexity of taxing virtual economies, which has been extensively discussed elsewhere by such august minds as Professor Richard Bartle and Professor Edward Castronova, among others, the idea of taxation at a micro-transactional level caused me to fire off two quick twitters:
(Nina Olson being the taxpayer advocate in question)
quickly followed by:
This set off a storm of direct messages and public replies asking me about taxation, mostly defending it. Most specifically, how are we to pay for police and schools.
To begin, as most of you know, I am a libertarian and am not the least bit frightened by the thought of a complete lack of federal, state, and local government intervention and services. I have yet to see an instance of a government program that worked as advertised and was delivered at or under budget. Most recently, the TARP program came under fire as there were no reporting guidelines on how the public funds were used. When this proposal, that the bailout-ees would have to account for how the largess was used to the baleout-ors, their reponse was:
"Iowa Banking Superintendent Tom Gronstal said he believes it will take some time before specific tracking mechanisms are put into place."
Ok, it was a 25 question application to apply for TARP funds, which went speedy quick. But when the people who give you the funds want to know how the funds are being spent, 'it will take some time'. If you had a stockbroker who refused to tell you how your deposits were performing, would you wait or find a better option. Would you have even put your money with him/her in the first place?
So, my response regarding taxes, like all government programs, is that they are perpetuating an unsustainable model. There will never be enough programs to make the government happy, and the government never shrinks itself. It's self-perpetuating, because the people in charge of deciding what to shrink are the people who stand to gain by expanding instead of shrinking the programs in question. Compound this extensive human self-gratification and you have a tax rate of >50% for many of us.
I live in a house that I own outright. I still pay a five-figure property tax bill, of which the monthly payments would afford me a lovely Italian or German sports car. In addition, I pay ~50% in income taxes, and am taxed a 6% consumption tax (sales tax) on any of the remaining proceeds I try to utilize.
On top of this, I write hundreds of dollars in monthly checks for both of my childrens public schools, for supplies and the like. Even given the $33 billion allowance afforded to the k12 system through the 2007 federal budget (and not including any additional funds from state or local sources), the teachers are still overworked, horribly underpaid, and begging parents like me for more money for supplies. If you were really generous with this allowance, and gave everyone in the U.S. 19 or under an equal share, they would each walk away with nearly $400 a piece, not counting any state/local sweetners.
My advice for those that are concerned that lack of taxes would render us school-less? Try it. Privatize all of it. Watch how capital efficient and quality-competitive education would become. It works every day in industry (barring misguided government regulation of energy and finance sectors), so why not education? Look at the quality of private higher education, like Stanford, and tell me that education is a unique snowflake that cannot be privatized without severe damage.
Public services such as Police and Fire are trickier. The Romans, who at one point only paid taxes three days a year, individually contracted private security and fire services. This was rife with problems as one would expect, with Julius Caesar's own cash-heavy-friend Crassus having made his fortune by instituting the first Roman fire department. That Crassus used it to extort the flaming homeowners to sell to him at remarkable discounts is unconscionable, however does not invalidate the private security model (e.g. ADT, Westec, Secom, San Francisco "Police Specials") and other more recent success stories.
Do you think that you know more or less than some administrator how and where your children should be educated? Do you think that a private company with a service-level-agreement for pay/profit would be faster or slower than your local police/fire/ambulance? I worked for an ambulance company at one point, and discovered that municipalities 'bid out' these franchises to private companies who run them at a profit. If you can do that for ambulances, why not fire and police services as well? Why not let the homeowners themselves decide what security/fire/ambulance companies they want a contract with, rather than some overpaid local administrator?
Net-net, taxes are a bad idea in the virtual world just as they are in the real world.
More than one vendor I spoke with at the Virtual Worlds Expo last week mentioned that they were working through 'scaling' problems with regards to their datacenters. These were not only children or tween worlds for playing games, but also 'business virtual world' advocates.
I began to think about this a bit more on my ample airplane confinement last/this week and the thought occurred to me that this could present an Achilles heel to the growing use of virtual worlds within the enterprise. Bear with me, I am jet lagged as all hell and 1.5 intimidating-German-machine-espressos into my morning, so feel free to point out any blatant miscalculations or misconceptions I may write forthwith.
Look at Warcraft. They have nearly twenty datacenters worldwide. Why? Because they don't want people having a degraded game experience due to cross-ocean latency on the Internet, especially when that latency isn't manifested as just a dropped voice or YouTube packet or two, but the difference between a live level 70 elf and a dead one.
Now, Warcraft comes as a big-fat-DVD of pre-loaded code, little user-created-content to speak of (within a limited palette), and so they are sending coordinate data (what we used to call 'telemetry data') to players to pull down assets from their pre-loaded library. From a traffic perspective, pretty lightweight, albeit latency sensitive. In this regard, it is analagous to the old TN3270 Mainframe emulation code that we used to ship around indescriminately in 1992.
Fast forward to the office of the future, the virtual office version. You have packetized spatial audio. You have user created content. You have streaming video and powerpoints and presence information. You have ever-changing mixes of synchronous and asynchronous traffic types all over walls and tables of your virtual headquarters. This is much more bandwidth intensive than Warcraft, and if you are having a staff or funding meeting, the voice/video latency is arguably more critical than simple 'the dragon killed you before you hit it with your sword' telemetry data. The PowerPoints can be a little delayed without anyone complaining, admittedly.
So, given that you can't 'shard off' the different offices (you are trying to facilitate the 'death of distance', right?) and you need to have a single virtual office where people can intermingle and interact richly, how are you going to accomodate the insane bandwidth and latency requirements of a fully-annotated virtual environment? Or, are the geographically remote participants going to have to suffer the latency inherent in such a rich environment as the cost of global collaboration?
I don't know the answer yet, just the question. I will be doing some more thinking about this this week in Coventry England where I have the honor of being the keynote presenter for the second year running at the Serious Virtual Worlds conference. I will bring up this issue to the virtual world vendors and customers present and see if any of them can quickly dispell my concerns. Else, feel free to suggest solutions or disabuse me of any misconceptions in the comments.
This isn't my first electronic book reader. I have been reading books on laptops, my old Newton, various Palm and CE-based PDAs, Smartphones (including my iPhones), and my Sony Reader. I think the idea of electronic access to my absurdly large library of books makes as much sense as electronic access (via my iPhone/iPod) to my library of music.
I think the Kindle, as aesthetically unpleasing as it is, may finally be a step in the right direction.
Rather than sprout a bunch of platitudes about how fantastic it is, let me just illustrate some uses I have put it to and let those speak for themselves:
Call it Augmented Reality, rev 1.
Now I know there have been experimental augmented reality platforms before. The MIThril platform at
the MIT Media lab was the foundation for a number of technology breakthroughs that my old team at Cisco sponsored over the years in the hopes of making 'presence' relevant in day-to-day interactions. MIThril was the stereotype of augmented reality systems (AR), heads up display, location information, and so on. Inevitably, the standard example for AR seems to focus on where you are how to get to restaurants your friends recommend (unless you are doing component assembly, at which point you receive 'in line' documentation while assembling).
I was thinking about this, in the context of Charlie Stross' excellent book Halting State and his 'copnet' that the law enforcement officials wear plugged into their transparent glasses, when my wife was configuring all the widgets and applications on the new version of software on our iPhones. I'd say that she was 90% there on the phone, minus the application crashes.
If you discount the heads up display (which would be slightly difficult, to say the least, to get widespread adoption with when you have states outlawing pedestrian tasks such as speaking on cellular telephones whilst driving or security guards hassling people for taking pictures within a shopping mall), then what does that leave you? Location, presence, metadata and the social aspect. Lets approach those one by one.
My old iPhone (1G) could triangulate from cellular towers to determine general location, whereas the new iPhone 3G has built in GPS that tracks your location (in greater detail than my in car navigation and comparable to my TomTom). This data is now requested by about every application which requests permission to access your location to narrow results, such as local movie theaters or restaurant recommendations.
Presence is trickier. When you have a battery-operated device, you need to periodically sleep the interface else you run low. You also don't want to constantly be updating your telephone if you are busy or not, so this is an area that could use some implicit-application innovation, versus explicit-updates like the AIM app on iPhone. Imagine if twitter auto-updated ('spimey!') with your location periodically with references to your prior notes on the location ("this place has great tofu!").
Metadata is probably one of the easiest aspects of AR currently instantiated on the iPhone. By this I mean augmented information about some location or item that you are currently either searching for or looking at. Is that a good or bad noodle house? Is this book cheaper on Amazon than this bookstore? What do the reviews say about this book? That is metadata. I use EverNote and love it, and love it even more now that there is a iPhone app for it. It seems like an automatic memory aid. In the event that the metadata I seek is outside of my Evernote domain, I have the entire web available to me from either a standard search interface or customized apps of every shape and color (wine suggestions, restaurant recommendations, and so on). Yelp or UrbanSpoon + iPhone-with-location rocks.
Which brings us to social networking. Yelp already incorporates your social group's input into restaurant reviews and the like. As the tools progress and we are able to work around tagging and categorization issues a bit more, you can expect that movie theater time widget to also tell you that your three friends panned the movie you are looking for before you spend the $11.00 for the tickets. Handy.
So, what is the difference between the traditional definitions of Augmented Reality and a handheld device that has, as we used to say in the Emergent Collaboration team at Cisco, "The three C's: Contacts, Content and Context"? Probably just the heads-up-display, although I am sure some savvy Apple developer could make my newest vga goggles do a pretty good imitation if there wasn't a police officer somewhere around to ticket me.
Let me get in my time machine for a second.....
Apple predicts that it will ship 10M iPhones within a year from it's July 2007 launch.
Apple ships about 5.7m iPhones (by multiple analysts conclusions) before supplies mysteriously begin to dry up in late March. By early May, even New York City has no inventory and a line for iPhones starts forming.
April 2nd, Henry Blodget at the Alley speculates that non-authorized international demand is consuming 'buffer inventory' and driving the shortage.
When Apple first introduced the iPhone 1.0, they could ship it 30/60/90 days post-announce because they had no shipping revenue product to stall. You really don't want to induce a revenue stall in a shipping product if you can avoid it, however Apple learned the hard way that you also don't want to anger your installed base of loyal/feral customers as they discovered with the iPhone price drop. So, you end up walking a fine line between angering your customers with lack of supply (or over-supply of new models) and angering Wall Street with periodic flatlines in your revenue stream.
The answer is to gracefully manage product transitions. This is an art form in itself, in the timing of messaging transitions, moving manufacturing lines, selling off inventory, upgrade and price protection programs, and the like.
Apple seems to have been caught in a perfect storm of unanticipated demand (Blodget's article about Europe) that they needed to quickly react to in the form of temporarily increasing the production line of iPhones so they could gracefully trickle out of them about May 30th....just in time to release the iPhone 3G and open up the larger price-sensitive and 3G-hungry market, and a new product introduction when they need to ramp down production of the older model in favor of the newer one.
So, do you ramp up or ramp down? Do you flatline sales of your iPhone line for 75 days during a key fiscal quarter (Summer/graduate presents) or do you enable your overflow production lines and meet demand at the risk of price-protection/exchange/returns exposure on your bottom line for a percentage of the customers who buy in May? It reads like a loaded MBA mid-term question from a sadistic professor who enjoys handing out 'C' grades to all students.
It appears Apple chose to flatline. I don't envy the beating they will take from Wall Street for this fumble, even though every Wall Street Analyst is slobbering over themselves today to say how much of a fait accompli the 3G iPhone is to wrest the title from the Blackberry for #1 in sales. I wonder how they will balance the stick and carrot of beating them for the quarter stall while praising them for the new product.
And it isn't an inevitability that Apple will more than address the revenue shortfall with the 3G iPhone. Even if Foxconn can overcome their initial production issues and achieve their 10M unit number, the revenue and profit per unit of the $199/$299 iPhone 3G are abysmal compared to the initial 1.0 iPhone at $499/$399. We used to have a sarcastic punchline back in the early Cisco IP Phone days..."We'll sell it at a loss but we'll make it up in volume!"
It could be worse, you could be the product manager at eTrade who announced yesterday the new eTrade Mobile Pro trading platform for mobile devices, exclusively for the BlackBerry.
2007 was unquestionably a significant year in the development of the Virtual Worlds industry. It went from a mocking human interest story at the end of the nightly news to the covers of prominent business magazines. As the proverb says however, 'Be careful what you wish for....'
There have been prior attempts at a 3D Internet, particularly around the Virtual Reality Modeling Language (or VRML). There were a number of market reasons that VRML never reached widespread adoption that were independent of VRMLs technical merits. In contrast 2007 featured the ramp of Second Life for public social collaboration and visibility for companies such as Forterra Systems for intraverse simulation and training.
The questions that we were asked during the 'New Ways of Working' panel at the Virtual Worlds 2008 conference last week in New York all seemed to be searching for the elusive initial proof-points to justify and quantify the benefit of virtual worlds in the enterprise. This is not unique to virtual worlds, and is a recurring theme in all of the emerging technology trends I have participated in. Early adopters attempting new projects within their organizations fortify themselves with metrics and other case-studies of successful deployments to demonstrate to their management the benefits of the technology in question, and virtual worlds are certainly no exception.
The current proof-pillars of this industry, however, are still scarce, with elaborate simulations being performed by the U.S. Government within Forterra Olive, as well as the Stanford SUMMIT medical simulations on the same platform. In the consumer area, there have been numerous examples of training and education within Second Life (including my employer) and isolated non-self-referential instances of collaborative design projects (most notably Wikitecture). What has not happened yet are the secondary ripples of these initial 'It can be done' proofs-of-concept, which will begin the snowball effect of more examples feeding more deployments which become examples for subsequent projects. It will take some sobriety on the part of marketing departments throughout industry, making sure to identify real value and not hand-waving, and it will take more time for the existing trials being conducted to bear fruit.
Two negative side effects of the excess of positive press in 2007 were that (1) each vendor in the 3D simulation area became an overnight sensation while many of their platforms were not ready for mainstream deployments, and (2) the peripheral/adjacent markets in this space (3D rendering engines, virtual economies, etc.) stampeded over to participate in the virtual gold rush, which made it harder for non-industry customers to get a bead on what this space actually is and how it benefits their organizations.
What this market pressure has exerted is a degree of speciation, in that companies are beginning to polarize into platform providers (intraverse or metaverse?), and component technology providers. An impacting externality to this is the emergence of the 'software as a service' business model within companies, who are evaluating these new virtual worlds not only from a 'should we/shouldn't we' decision, but also from a 'hosted/service' decision as well. One more barrier to adoption.
Speaking of barriers, if you ask most virtual world platform vendors what their top five barriers to adoption are, inevitably one of them will be the issue of 'corporate firewalls'. Given the immaturity of the technology, the non-standardization of ports and protocols used across vendors (which, admittedly, will be the case for some time as is the case in each new technology cycle), and the absence of overwhelming-demand on the part of major corporate clients, the corporate information-security technology departments will be in no hurry to poke holes in the corporate firewalls for a currently unproven application. It will happen over time, or the protocols used may render the discussion moot by leveraging lessons learned by companies like Skype in the VoIP space.
You see the initial furtive steps of companies to offer both a SaaS or Hosted model of their collaboration environments (such as the IBM/Linden Lab announcement) as well as overtures in that direction by companies like Qwaq. That will remove one barrier to adoption.
There have been the overtures towards data standardization with Multiverse and Google embracing COLLADA (and Intel hiring COLLADA people as part of their strategy) and the Virtual Worlds Interoperability Forum (of which I am a member). These efforts will initially focus on interoperability between virtual worlds and Internet data sources (like COLLADA files) rather than avatar portability. In contrast to my prior post about the future of virtual worlds, this degree of interoperability will be sufficient for some time as the broader Internet identity problem is resolved, as a choice of 'presentation layers' (in the form of virtual worlds) of a common dataset will be functional enough to limp along. The difficulty in that scenario will be in cross platform meetings.
The next post will posit some paths that the industry can take at this juncture, and if it will continue to be rather boutique, or will move into mainstream deployments.
Last week I had the honor of keynoting the Friday session at the CMP Metaverse Life 2.0 conference. During the presentation, I mentioned the multiple points of evidence that I had encountered of the evolution underway from traditional workplaces to geographically-independent workspaces. The summary of the argument is:
We have been gradually migrating from a traditional industrial-age workplace metaphor of individual work tasks performed in a shared setting (think of a cubicle-farm of either call-center representatives or engineers occupying three floors of a building) to a Knowledge-age metaphor of more collaborative, integrated tasks that are performed by virtual, geographically dispersed teams. So, instead of doing autonomous work in a collaborative setting, we are doing collaborative work in more and more autonomous (or at least geographically distinct) settings. This is the Shift.
As far as proof points for the arguments, consider the trends towards globalization of industry (and therefore a more distance-collaboration-sensitive market) that are an inevitability of the flattening effect of world commerce, outsourcing and off-shoring of labor and other tasks, and an increasing trend towards telecommuting, flexible work arrangements and work-at-home roles. JetBlue stay-at-home call center agents come immediately to mind.
A factor (that I hadn’t really considered until recently reading more about the major impact on the global workforce composition by the retirement of the baby-boomer generation) is that there will be a shortage of skilled labor in many areas that will mandate new tools to allow retired boomers to selectively participate in the workforce. If these gainfully-unemployed retirees are to be courted in this soon to be ‘sellers market’, the successful ‘buyers’ will be those that provide the tools for frictionless distance collaboration from their balmy retirement locations.
Having recently ‘pitched’ a room full of senior citizens on new technology trends, I can assure you that they are disinclined to buy a computer (if they do not already have one), much less create an avatar. They are comfortable with the traditional workplace metaphor described above, with autonomous-work/shared-environment, so any tools that are developed for them must be painfully easy-to-use and consistent with their ingrained habits.
(addendum- Some people have mis-interpreted this prior paragraph to imply that I am making some ageist comments about the technical abilities of people older than my 40-year-old-self. Before everyone gets more fired up than they already are, let me assure you that I have worked for/with/managed young and old alike who are technophilic or technophobic, and that age has little to do with it. I will say, and gladly stand by, that my six and three year old daughters are more inclined to go-to-work as avatars than nearly all people I work with regularly in Silicon Valley. The point being, we need easier to use tools that leverage workplace metaphors we are all familiar with, not something orthogonal and disruptive. Unless you are three or six years old, at which point, 'disrupt away')
To return to the Shift, what tools will we need to develop to enable technophobic retirees to participate in a Hollywood-style of work? Is it easy video-conferencing, shared whiteboarding, avatars?
Suggestions welcome and encouraged.
I received a nice note from John Jainschigg over at CMP Metaverse this morning about last week's Future of Work blogpost. He had resonated (as had I) with the idea of 're-intermediation' that was put forward by one of my colleagues (who at this juncture should feel free to chime in on the comment roll and remind me, pretty please with sugar on it) at the MetaverseU a few weeks ago.
Someone once said that every challenge is also an opportunity, and the converse is true as well. The workforce is being rapidly globalized, and roles you would have never envisioned being outsourced are migrating to Bangalore or Beijing at a breakneck pace. I was personally shopping prices on personal assistants from three different shops in India earlier this week, something which would have seemed insane half-a-decade ago.
At the same time, you have the demographic mass of baby-boomers who are frustrated with the first generation of outsourced service, and are demanding a higher-touch model of customer care. This is going to have two effects if it 'gets legs', which isn't such a BIG IF:
1) Operational Expenses (OpEx) of the firms switching to providing 'domestic' customer care is going to go up in most cases. Despite the vaunted examples of JetBlue and others in having stay-at-home-moms-in-Utah provide call center support, US labor is inherently more expensive than other parts of the world can currently provide. The rising cost of living in India and China combined with the falling value of the dollar are driving those forces towards some equilibria, however it's not going to resolve for another decade or more.
2) A gray-dawn contract workforce. The boomers aren't ready to sit back and accept a uni-directional money flow. They want to work, and wouldn't mind if you offered some health care while you're at it. There are some amazingly well-trained people in the boomer generation just now retiring, like 12 percent of the engineers and 21 percent of the scientists at NASA for starters, who are ready to tackle whatever technological marvels you throw at them.
If you don't think that the AARP (American Association of Retired Persons) isn't already the strongest lobby in Washington D.C. already, wait until their numbers swell with the boomer bolus. They will be in a position to not only harangue your CEO for making them wait an hour for a call center representative, they will also exert pressure in the form of regulatory measures and tax laws to drive macro-level patterns of business. Think of how large of a group of people this represents, how well-educated, and how much free time they will have on their hands to do nothing but what fix the aspects of their life that annoy them most. Pretty much the customers from hell.
So the latte-slurping freelance workforce I posited in the last post, while agreeing with all of Prokofy's comments that delivering babies, pizzas and taxis will always exist in meatspace and are immune to the transition from manufacturing to knowledge workers, will be both servicing the baby boomer generation, and will also be comprised of a number of those boomers who will work-at-leisure to finance their vacations and second-home-property taxes.
And for those that are concerned that boomers and seniors will be discriminated against directly or indirectly because of their age, how about their avatar? Their Brad Pitt/Angelina Jolie looking one.
A metaverse outpost would allow them to provide value to the workforce from their snow-bird homes in the desert or on the Gulf coast. In the Metaverse, no one knows that they are a retired engineer sitting on his/her back deck enjoying a margarita while resolving your customer service problem.
More later, the treadmill beckons.
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