Arthur on why IT matters

Arthur on why IT matters

Summary: Steve Fulling, CIO of Sento Corp wrote me to say he'd heard W. Brian Arthur, a Santa Fe Institute economist, speak last night on why IT matters.

TOPICS: Emerging Tech

Steve Fulling, CIO of Sento Corp wrote me to say he'd heard W. Brian Arthur, a Santa Fe Institute economist, speak last night on why IT matters.  Steve reports the gist of the talk was that India and China will not steal USA innovation and dominance in the world economy.  Arthur's basic view is that IT drives innovation and this innovation has just begun.  Arthur said after the railroad stocks and businesses crashed (in the UK and US), there was 10x the growth period after a 3-4 year "settling" out just after the crash.  During the crash, you could not give away railroads, but when you did the math 10 times more track was laid after than during the peak of the railroad bubble.

Arthur's views are diametrically opposed to those of  Nicholas Carr who wrote the infamous IT Doesn't Matter paper.   Arthur has been saying this for a while--I wrote something about them a few years ago.  I wish I'd been there to hear him speak. 

Topic: Emerging Tech

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  • Let me tell you a little story...

    About a little town in Venezuela in the 80's. It was situated on the side of a volcanic mountain range, several miles from a grumbling, rumbling, semi-active volcano. One year the volcano grumbled and rumbled more than usual. But the mayor of the town and the church leaders and so on told everyone not to worry, the volcano hadn't erupted in like 150 years. However, one person did the math and realized that the volcano had been known in history to erupt once every 150 years or so... And as well he put together a very concise warning of these facts which he then forwarded to the town office, the town newspapers, and so on, and otherwise tried to publicize his findings. To no avail - the mayor's office threatened the person for spreading "hysteria". The volcano erupted not long after, and 40,000 people perished.

    The moral? Arthur's idea that we have to go through hell to get to heaven is ridiculous. In the 30's, the depression very nearly put an end to the United States. Because the U.S. survived does not mean that the problems that lead up to the depression and those experienced through it were somehow "necessary" or "beneficial" steps! Good lord!

    Arthur's comments are an example of how politicians and others with a vested interest in the U.S. IT market are doing their best to scramble and reassure everyone that "everything is going to be ok!" When the handwriting is on the wall, in reality. They ate their cake, these large corporations, they did their dirty deals in their back rooms, and undermined innovation, crushed the small guy, and stifled new technologies that could have revolutionized western economies and made for ubiquitous wealth. Why? Because it's no fun being rich and powerful if there aren't any peons to gloat over.

    So listen to the Venezuelan Mayors if you want to. But know this - hiding our heads in the sand will not change the fact of the coming preeminence of China and India.
  • Covering the ground

    For railroads, there are geographic areas which could be profitable if the service becomes available. When all of those areas have been covered, the market has been saturated.

    For software, there are functions which are essential to business. Software that provides these functions will be profitable. When all of these areas have been covered, the market has been saturated.

    New ways to solve old problems can obtain purchase, if they're cheaper, do more of what's useful, or work more efficiently.

    Doing more or working more efficiently requires greater and greater effort as time goes on. The software becomes more elaborate.

    Think of a nearly exhausted mine; the work of getting at the valuable ore that's left is going to keep increase in expense and complications.

    But no one would think of elaborations as innovations.
    The exhaustive work required can be done by people in India or China or anywhere else the ideas for elaboration can be made concrete.

    In short (I know, too late), the idea that we can expect an explosion of software innovations in basic functions appears to be more wishful thinking than logic.
    The railroads already run most places they're needed.
    Anton Philidor
  • mind saturation

    Most people have made their choices as to what software they are going to use over the coming years, at this point, even with attrition it will take another generation to wipe out brand recognition from the main players in the professional, and yes even operating system markets. Most people just don't have time to sit and hack at their machine to gain some tiny advantage in ease of use. The bubble burst, and as evidenced by the recent interest in migrating from windows 2000 to anything else, the masses are generally satisfied with the present state of computing.
    A real leap must be made in technology, on in which the average user is not patching his machine in an ongoing regimen, their identities are not being pilfered, they do not have spyware, malware, and hackers tearing up their brand new machines, basically get the house in order. Boom times lead to crazy thinking, people don't go out and replace their tv sets every 2 years, and I cannot imagine changing computers any more often than every 5 years, there is just not enough need that is unfulfilled.
    Asia and other developing nations are the last frontier, and somehow I believe they want their slice of the pie as well. Its back to the drawing board, and some new innovation (for real, not some packaging glitz or rehash of old problems)
    Bill Gates has billions of dollars of programming going on for nothing, except to fix their own mistakes, or try to take over the computing markets in their entirety, which I doubt anyone will let happen. It's all turned into a job, the more we send somewhere else out of arrogance, the fewer we will eventually have. We need to start teaching math and science, (and forget about creationism)and teach some traditional values to our children (like being a rapper, rock star, or professional athelete isn't likely to happen to them) so find some other creative outlet.
    I do believe that the creative uses for the computer are just beginning to happen, and this may be the outlet for a lot of "15 minutes of fame". It also seems like a lot of "15 minutes" may also be a detriment, the fun is just beginning trying to control the monster we have created.