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Disruptive Innovation And How Coal Killed Tony Abbott!

Ok, as I’m fond of reminding everyone, trying to be a prophet is dangerous. As Yogi Berra said, “Making predictions is difficult, especially about the future.”

When I tell you that I doubt that Tony Abbott will last the year, I’m overlooking the obvious fact that this current government has shown itself to be so incompetent that – while it’s common knowledge that most of them are committed to replacing him at the first available opportunity – they remain incapable of organising a coup. And while I suspect that many of you are thinking of phrases involving, breweries and brothels, I’m far too classy to use words like “piss-up” and “root”, so shame on you.

I’ve been spending a fair bit of time this week trying to find a way to send up Joe’s idea that it’s outrageous that we have bracket creep during one of the slowest periods of wage growth in this country since the Great Depression, while suggesting that maybe it’d be a good idea to extend the GST to things like healthcare, so that the government can not only add ten percent to your health costs, but ten percent to the health budget as well. Ultimately I came to the conclusion that Joe’s own words are enough in themselves.

Still, I must say that it’s reassuring to know that when he speaks to Tony, the conversaion is so chock-a-block with ideas about JOBS and GROWTH, that there isn’t time to utter a parting, “By the way, Tones, I’m thinking of bringing up the Republic in the next month or so. No need to discuss, but didn’t want you to be caught unawares. TTFN.”

Nah, the conversation is all about lending money to Adani to build a railroad to its non-existent mine. And the Government needs to do it because banks have an obligation to thier shareholders not to lend money to enterprises that are liable to be non-existent within a few years. I know this because when I suggested to a bank manager that I’d like to borrow a billion dollars to help out the local video store by training carrier pigeons to deliver videos directly to the house, he didn’t want to know about my plans to expand this into a world-wide video chain like Blockbuster. He seemed to be under the mistaken impression that the future may be different to the past and that video stores were a dying industry. I tried to tell him that they were good for humanity and that people liked going to the video store and that they’d always be there, but he said something about “disruptive innovation” and the video store shut before I could approach the government for a subsidy to enable me to use the unemployed to sit on pigeon eggs in order to help them hatch.

At this point, I decided to look up what he referred to as “disruptive innovation” and it was quite interesting in the way that watching a car crash from the other side of the road is quite interesting, or the visits to a counsellor to deal with your post-traumatic stress is “quite interesting”.

Put simply, “Disruptive innovation” is when a product comes along that changes the game. Businesses exist to service their customers. While they want to attract more customers they’re not really interested in people who aren’t likely to be customers, so they ignore the innovation which will replace what they do and this ultimately leads to their downfall.

The best recent example is the computing industry. Many of you would be familiar with the following quote:

“I think there is a world market for maybe five computers.”

Thomas Watson, president of IBM, 1943

Of course, computers in those days were as large as a house, and even when they became smaller, the business model involved companies taking their computing needs to a place where these large computers were stored. It would have been silly to have taken up so much space at the business itself, when you had so little need for computing.

Apple’s early computers were “toys” and no threat to the business model, so the big companies could afford to ignore them.

Ok, we all know how this turns out. And there was probably a point when some of the now-defunct companies that made large computers could have adapted. But that wasn’t what their customers wanted. And the customers always right, eh?

Well, that’s sort of where we’re at now. The Abbott Government thinks that if they just keep supplying their “customers” – like the coal industry – they’ll be ok. They fail to see that coal can become as irrelevant as a source of power as quickly as the car industry shut up shop once the Abbott Government was elected.

In the meantime, I guess, all we can do is write to the government and urge them to do the right thing. And while you’re at it, suggest that they’d be better off subsidising me.

After all, I have a lot of pigeon eggs that need hatching and that seems a lot more realistic than anything we’re hearing about Adani.


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  1. Matters Not

    Speaking re ‘predictions’, try these examples:

    I think there is a world market for maybe five computers.” — Thomas Watson, chairman of IBM, 1943.

    • “I have travelled the length and breadth of this country and talked with the best people, and I can assure you that data processing is a fad that won’t last out the year.” — The editor in charge of business books for Prentice Hall, 1957.

    • “But what…is it good for?” — Engineer at the Advanced Computing Systems Division of IBM, 1968, commenting on the microchip.

    • “There is no reason anyone would want a computer in their home.” — Ken Olson, president, chairman and founder of Digital Equipment Corp., 1977.

    • “640K ought to be enough for anybody.” — Bill Gates, 1981.

    • “This ‘telephone’ has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us.” — Western Union internal memo, 1876
    • “The Americans have need of the telephone, but we do not. We have plenty of messenger boys.” — Sir William Preece, chief engineer of the British Post Office, 1876.

    • “While theoretically and technically television may be feasible, commercially and financially it is an impossibility.” — Lee DeForest, inventor

    But if you really want a more current example of complete nonsense, try this one:

    No household needs more than 25Mb – Abbott and Turnbull 2013.

    Great article Ross.

    I just shake my head.

  2. stephentardrew

    Great satire Rossleigh so true. Nice list Matters Not.

    A short perusal through Science Daily,, Ray Kerzweil and a host of science sites will demonstrate one thing. That technology is racing ahead at a breakneck rate.

    Renewable energy is going to kill fossil fuels in the not too distant future. Then there is microprocessing, chemistry, health, material sciences, food production and on and on it goes rolling out innovation after innovation as startup times shrink and roll out becomes more efficient. Self-replicating machines are on their way as are sophisticated solution based robotics and AI evolve. Printers that can print a whole hose in a day are already in use. That is the tip of the iceberg. Elon Musk now has a viable and affordable storage battery in full production that will become cheaper with economies of scale and improved over time makin solar storage a fact.. Musk’s electric cars are constantly breaking records and only today a new type of battery with a lifetime guarantee has been disclosed. High speed rail will make many plane journeys redundant and on and on it goes. I could fill several pages and not even touch the surface.

    Politicians by and large are technological and scientific numbskulls whose primary focus is the next election. Now apply Matters Not’s short list across the vast array of technologies and you have mega growth in technology. Ray Kurzweil predicted this years ago and as Mores Law has stood the test of time so has his prediction of exponential growth in technology. Peter Diamandis and Steven Kotler in their book “Abundance: The Future is Better Than You Think” presents statistical and scientific analysis of innovation, resource distribution and enhanced efficiencies, including stopping planned obsolescence, that will lead to a sustainable future. Hans Rosling statistical analyiser Gapminder, which you can download and use yourself for free, is providing data sets of knowledge that are challenging many long held conventions including things like population growth which he demonstrates is gradually stabilising. Unless you seek out the facts you know very little of the changes happening. These changes have just been moderately accelerating however from now on the pace will be almost frenetic.

    These are some of the greatest and most important innovators and entrepreneurs on the planet. So Rossleigh’s computer analogy is perfect because this is not only one marvel like computers rushing ahead there are literally thousands of innovations that are going to dramatically change our world and at a pace we do not yet understand or appreciate.

  3. M-R

    Yes to all this. I keep wondering why no reporter (refuse to call the ‘journalists’) will ask a single member of the LNP exactly WHAT is being done about jobs and growth, on every occasion – too many to count – the phrase is mentioned.

  4. Ross in Gippsland

    The scene, the PMO, sometime in the near future.

    Tony: Right, Joe this is an old trick I picked up in the seminary. We tell Liberal Party HQ that I’ve gone
    insane and I’ll be invalided back to England before you can say “Woobble” — a poor gormless idiot.
    Joe: But I’m a poor gormless idiot, Tony, and I’ve never been invalided back to England.
    Tony: Yes, Joe, but you’ve never said “Wooble.” Now, ask me some simple questions.
    Joe: Right. What is your name?
    Tony: Wooble…
    Joe: What is two plus two?
    Tony: Oh, wooble wooble.
    Joe: Where do you live?
    Tony: Canberra.
    Joe: Eh?
    Tony: A small village on Mars, just outside the capital city, Wooble.
    Peta: (enters) All the cabinet present and correct, Tony. Ready for the off, eh?
    Tony: I’m afraid not, Peta; I’m just off to Hartleypool to buy some exploding trousers.
    Peta: Come again, Tony — have you gone barking mad?
    Tony: Yes, Peta, I have. Cluck, cluck, gibber, gibber, my old man’s a mushroom, et cetera. Go send a runner to tell General Cosgrove that your PM has gone insane and must return to England at once.
    Peta: But, Tony, how utterly ghastly for you! I mean, well, you’ll miss the whole rest of the election!
    Tony: Yes, very bad luck. Beep!
    Peta: Right.
    Tony: Beep!
    Peta: Joe, I’ll be back as soon as I can.
    Tony: Pah-pah!
    Peta: Whatever you do, don’t excite him. (leaves)

    (With apologies to the lord of adders black).

  5. Anomander

    Great stuff Ross – hilarious, if only it wasn’t so true.

    Another industry in its death throes is the media, who day-by-day keep proving how worthless they in failing to do their job of critical analysis and reporting and instead simply parrot the words of the politicians and corporate lobbyists.

    Science has delivered astounding and profound technological changes in just my lifetime. Improvements in technology, health, communication, transport, computing, education, has improved and changed outcomes for billions of people globally – what we will achieve into the future is the stuff of science fiction to us.

    Alas the conservative forces are waging a war against science and it is vital we fight their ignorance every step of the way.

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