Here is a post by Steve Blank, a venture capitalist, identifying a fact:
Facebook takes our need for friendship and attempts to recreate that connection on-line.
Twitter allows us to share and communicate in real time.
Zynga allows us to mindlessly entertain ourselves on-line.
Match.com allows us to find a spouse.
At the same time these social applications are moving on-line, digital platforms (tablets and smartphones) are becoming available to hundreds of millions. It’s not hard to imagine that in a decade, the majority of people on our planet will have 24/7 access to these applications. For better or worse social applications are the ones that will reach billions of users.
Yet they are all only less than 5-years old.
Here is his inspirational conclusion:
It cannot be that today we have optimally recreated and moved our all social interactions on-line.
It cannot be that Facebook, Twitter, Instagram, Pandora, Zynga, LinkedIn are the pinnacle of social software.
All of these things are true. And here’s his opening line: “The quickest way to create a billion dollar company is to take basic human social needs and figure out how to mediate them on-line.”
I think he needs to shift to past tense, there.
The most influential personal/enterprise software companies in the early 80s were Apple and Microsoft. And who are they today?
No need is ever satisfied perfectly, but there is such a thing as a big head start. Surely it’s more likely that the Instagram acquisition represents the end of the disruptive phase of this technology trend.
Innovation comes from working on a need that you have that isn’t yet satisfied. The best itches to scratch are ones people will pay you for, obviously. And as a general rule, the market price for something is typically about as much money as someone else can make with it.
Social media is a bit different, much like newspapers, radio, TV and other advertising-driven businesses were different. These are super-scalable goods with the ability for pinpoint market segmenting. All very exciting, but their economic function is simply to make insurance more efficient.
I’d be more inclined to think that the next wave of billionaires will attack the problem of process inefficiency more directly. History tells us that this usually happens by elminating processes entirely.
My favorite disruption came soon after this:
In 1898, delegates from across the globe gathered in New York City for the world’s first international urban planning conference. One topic dominated the discussion. It was not housing, land use, economic development, or infrastructure. The delegates were driven to desperation by horse manure.
The horse was no newcomer on the urban scene. But by the late 1800s, the problem of horse pollution had reached unprecedented heights. The growth in the horse population was outstripping even the rapid rise in the number of human city dwellers. American cities were drowning in horse manure as well as other unpleasant byproducts of the era’s predominant mode of transportation: urine, flies, congestion, carcasses, and traffic accidents.Widespread cruelty to horses was a form of environmental degradation as well.