April 2009

AutomatedBuildings.com

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It’s 1992 all over again!
As there was a driver in the 90s, today there are two of the most significant drivers that we can imagine in play, the Y2K of today if we continue the comparison to the 90s.


Anto Budiardjo
President & CEO,
Clasma Events Inc.

Contributing Editor  

This was a comment I heard recently from a Silicon Valley veteran, someone who like many in Silicon Valley was witness to the enormous changes that ensued over the 1990s and eventually led to the dot com bubble burst. What’s so magical about 1992?

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1992 was a couple of years before the Internet became mainstream. It was a time when all of the stars were aligned which enabled the Internet and all of the changes it brought about to happen. 1992 was a year before eBay, Amazon, Google, Yahoo, Craigslist and the many other brands that we now take for granted came into our consciousness.

1992 was also a time before mobile phones became an everyday device, when we were probably hooked on our pagers (remember those things?) as much as we are now hooked on our BlackBerry or iPhones. The chances are that most of the readers did not have email addresses, were struggling with using MCI or Sprint calling cards to make long distance calls at phone booths (have you see them around lately?), and of course the fastest way to get a “letter” to someone was to use a fax (using horrid thermal paper).

1992 was in essence an easier time; one could say it was the “good old days” when life was simple. Itemized bills were uncommon, so phone bills were simple, bank statements arrived once a month, and we typically would not have a clue of the state of our finances on a day-to-day basis—heck, why would you need to know that! We paid for things monthly using checks that we mailed at the post office!

But there was something “fundamental” going on in Silicon Valley in 1992.

You see, in 1992 all of the fundamentals about the Internet were in place. The basics of the information network had been developed; TCP/IP and Ethernet were in place and had crossed their respective technology chasms. The World Wide Web was in its infancy; I recall the day with great clarity when I first experienced a dialup connection to the Internet in 1992. I was visiting Long Island, NY, in a Holiday Inn room. I installed WinSock on my laptop, dialed a local ISP and the next minute I was using this strange thing called a browser, looking at pages being dished out from a server from my native country of Indonesia! The other side of the world for a local call! WOW!

The concept of information technology was also becoming understood in 1992, with many people starting to realize the potential of this burgeoning Internet to do useful things! Changes in the industry, from the near implosion of IBM (though they recovered), to the demise of Digital, Wang, Digital Research and other brands, were well in progress.

1992 (give or take a year) was the year that many of the Internet start-ups started up. The founders of eBay thought there was a better way to connect buyers and sellers and transact business. Mark Bezos (Amazon) asked the question of what is the product category that has the highest number of SKUs (answer: books), and search companies started to realize that the millions (they had not gotten to the billions yet) of pages of information would need some help to be found.

It was also soon after 1992 when one of the most significant drivers for the Internet and IT emerged, the much dreaded Y2K. The predictions of Y2K were serious and dramatic; the world was going to come to a halt, planes will fall from the sky, nuclear power stations would melt, and money in our bank accounts would vanish into nowhere. While many say that Y2K was a big hoax, it did do something very significant; it galvanized the IT industry into action with a date certain deadline. It’s been said that the bulk (maybe all) of the benefits of Y2K investments, including things like CRM, Supply Chain and Enterprise systems, had nothing to do with Y2K (though we’ll never find out if the world would have imploded had we not done anything).

The result of all of these innovations changed everything to the world that we know now – The Digital Age.

How does that relate to today?

Much of a similar scenario is in place today. The Internet itself is mature and pervasive, from personal communications to business commerce and entertainment to lifestyle and Web 2.0 and social networking. Also mature and pervasive are the connectivity infrastructures from broadband and wireless which now touch (or potentially touch) the vast segment of the global population – at almost no cost!

Core technology itself, from computing power to cost of technology, is at a stage that makes it reachable for new applications beyond person-to-server uses. The power and connectivity of smart devices is at a stage of making billions of devices be able to connect and provide some useful purpose to a new breed of nodes on the Internet: devices and machines.

If you look in the right places (and yes, I have a front row seat), you can see innovative start-ups asking similar questions to those asked in 1992, about what the new opportunities are, and most agree that we are talking about the next wave of the Internet. At the time you are reading this I can assure you that planning meetings are taking place and business plans are being written to create the Amazons and eBays of tomorrow.

As there was a driver in the 90s, today there are two of the most significant drivers that we can imagine in play, the Y2K of today if we continue the comparison to the 90s. These drivers are climate change and global recession.

I doubt that I need to spell out the challenges of climate change, though I have to admit I still find climate change doubters. The point is that climate change puts Y2K to shame if we’re comparing the potential disaster that could impact our lives and our world, and while some could argue that there is a less than a 100% chance that climate change was human caused, I can reassure you that, like Y2K, climate change is 100% the most significant driver for change and innovation in all major industries.

[an error occurred while processing this directive] The global economic recession is an issue that is affecting almost all of us today, if not directly, then by the sheer fact that the U.S. and global economies will decline until we collectively sort this out. The question being how do we sort this out, or more correctly, how can we in the U.S. leverage the most valuable essences of the American culture, the spirit of innovation, risk taking and going into the unknown to lead the way to recovery?

If you delve into these two drivers, you find a number of common causes and solution areas, and a lot of it revolves around energy. As Thomas L. Friedman, New York Times journalist and author of The World is Flat, put it, how do we “get abundant clean and cheap electrons to the world population?”

The manifestation of this observation is how can we use information technology and the innovation that it encourages to help us source, distribute and use energy better. This is what Al Gore calls the Electranet, what Bob Metcalf (inventor of the Ethernet) calls Enernet, what Juval Lowy (.NET guru and developer) calls the EnergyNet, what Friedman calls The Energy Internet, and what President Obama and many others call the Smart Grid.

You see, right now a whole host of people, innovators and start-ups are defining this next decade, and in fact, the 21st century.

As with the 90s, the next few years WILL deliver huge innovations, new brands, technologies, products, and services to you and me and our businesses, new WOWs! Similar to what I experienced in 1992. And without doubt the next few years will cause major failures of major brand names that only a few months ago we took for granted.

The seriousness of our problems and significance of our opportunity cannot be underestimated. What we are going through right now is no minor change of focus; even the creation of the Internet will be eclipsed by what is about to happen in the intersection of energy and information technology.

As Jeff Immelt, the CEO of GE commented recently that what we’re experiencing is not just a cycle; it’s nothing short of a “RESET” of business.

Meanwhile, back in Silicon Valley

The trigger of these thoughts was a conversation with I had with Juval Lowy (.NET guru guy) and my observations on what is happening in the Bay Area. It is thus no accident that we chose Santa Clara, in the heart of Silicon Valley, as the venue for the next BuilConn, as part of ConnectivityWeek in June.

The BuilConn agenda tells the story of this impact on and reinvention of building automation, while the agenda of ConnectivityWeek tells the broader and more serious impact of how information technology will affect energy systems of the future, and how it will affect us all in some profound but yet unknown ways.

Juval has kindly agreed to deliver a keynote at ConnectivityWeek; so much more of this story will unfold in June in Santa Clara.

You see, as the buggy whip industry vanished overnight when cars became mainstream, and the Word Processor business (as in Wang) disappeared overnight with the advent of the PC, and as huge institutions such as Digital become acquisition fodder, the question you have to ask is if your business and industry is secure in the future that is unfolding before us. Go blindly at your peril!

It is ConnectivityWeek’s mission to help you figure this question out.

See you in Santa Clara this June 8-11 and secure your place in the future global energy industry! footer


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