The most accurate
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|SNS Subscriber Edition
||Volume 10, Issue 44
||Week of December 17, 2007
Top Ten Predictions for 2008
Publisher’s Note: This issue may be circulated without restriction.
Our thanks to everyone who helped to make the SNS New York
Dinner a success. You may see pictures of last week’s event here:
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The Parthenon Group
Polaris Venture Partners
Waggener Edstrom Worldwide
And one anonymous Mystery Patron --
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» Top Ten Predictions for 2008
We had another great time in New York last week, now our
third go-round at turning the Waldorf=Astoria Conrad Suites into an SNS
brainstorming event, focused mostly on the next year and technology markets.
In doing my own homework on making these predictions, I look
around at various issues and landscapes, with the perspective that events don’t
devolve in a vacuum, that all issues are eventually global issues, that
technology markets are directly affected by political, social, and economic
climates, and that accurate predicting requires input from these, and other,
levels (such as CEO behavioral profiles).
I am not going to repeat the entire speech here, for two
1. I would rather focus on ten specific results, and
2. You can now hear and/or see the speech, via streaming
video or MP3 file, at the URLs listed at the end of this letter.
Something unusual happened this year, in making these
“landscape” projections: I ended up with some predictions that may be more
important than those in our Top Ten.
The one that may mean the most to people in the tech
industry is the one that Steve Lohr of the New York Times picked up from that evening, for his own blog:
The global economy has now
essentially “outgrown” the U.S., particularly in IT markets.
If this were a question, most economists would answer with
an unqualified “No.” But my bet is that, for the first time, IT spending will
continue to grow so quickly outside the U.S. that a decline in U.S. markets
will not pull down total spending.
It didn’t hurt that IBM CEO Sam Palmisano came out with an
internal memo saying the same thing within hours, according to Steve’s blog.
In other words, in the Information Technology universe, the
U.S. matters; it just doesn’t matter as much as the rest of the world.
And that, if it turns out to be true, is a first.
Most large IT corporations now make more than half of their
revenues outside the U.S., and most other countries are showing GDP growth
rates that will remain robust, even with a dip in the U.S. China now depends
more on Europe than on the U.S. (and, interestingly, Europeans fear Chinese
trade policies more than Americans do – 59% to 50%). India increasingly
is doing work that may be outsourced, at the very high end (doctors reading
medical imaging, engineers reviewing structural requirements), or may be
destined for domestic or other non-U.S. clients.
Certainly, all of these economies would be hurt by a U.S.
recession. But large IT companies, for the first time ever, may be positioned
to do better than the original mass IT market.
What else is worth keeping in mind as we look forward a
year? Here are a few more important landscape calls:
2008 is the first year of Rapid Response to the Climate
Crisis. Just playing along no longer cuts it; now revenues and profits will
begin flowing directly to those who are implementing positive change on this issue.
This is the largest-scale trend of the year.
Interesting corollaries: the Beijing Olympics will probably
create a very unintended anti-Chinese–pollution backlash.
will find a new floor at $70, the average will be higher, and we’ll see a
second run at $100 at, or just after, next year end.
Look at the picture of
the Fed raising rates, trying to end inflation, and then coming back down when
commercial banks failed to follow. Label that picture “Capitulation,” and file
it under “The Fed has lost control of the U.S. economy.”
The U.S. real estate
markets will hit bottom in 12-24 months.
Inflation in the U.S. is
running much higher than government-supplied figures in the 2% realm; the real
figure is probably 5-6%. (Note: the government subsequently
published a high-for-them figure of 4.3% for Q4. They’re starting to get it.)
And here is one the crowd seemed to like; it’s totally
sincere. Given the recent election of Kevin Rudd in Australia, and his first
three official actions (signing the Kyoto protocol, announcing one-to-one
computing for all students in K12, and creating a new Cabinet-level position in
charge of Broadband):
In 2008, Australia will
be “The New Canada.” (SNS Members will know that this means “a great
With the U.S. economy in struggle mode, Europe faring
passably, and the rest of the world growing at record paces, here are my Top
Ten calls for the coming year:
Ten Predictions for 2008
1. The Users Revolt. As advertisers focus in on social networking sites,
users revolt against this trend, and power shifts in the worlds of Social
Networking from owner to user, on issues ranging from Second Life rules and
Facebook privacy to Cellphone Billing. Users will gain new leverage.
As Facebook fades with its Beacon
Blunder, people realize their private/public spaces are for proactive
networking, not advertising and privacy invasion. Social
networking sites become the hub of all applications; rules tighten. New
sites show increased privacy protection, smaller numbers, and tighter
2. The Phone and Web Worlds
Will Merge. Or: Walled Gardens Get
RoundUpped. Net Neutrality will prevail; carrier and ISP garden walls will fall.
Box guys will win over Pipes guys. Handheld makers will win over carriers, a la
Apple and Nokia. Samsung, Microsoft, and Google now join them in control.
Tribes move from phones to the Web
as part of this merger. Question: How do you carry your tribal affiliations
around on the Web? Widgets let you put them in Facebook, but ---
3. Content Has No
Boundaries. Or: By Expanding, the Web
Disappears. Content will be provisioned to every device, making the “Web” seem
an outdated idea, like “multimedia.” As it moves onto phones and TVs, it
becomes invisible. I want the service; I don’t want its history. The separation
between print and Web providers becomes outdated. Everyone distributes
Serious Segmentation of Online Ad
Monies Defines the Spend Trend. Start segmenting by user age: the young are
surrounded; the older are less tolerant of the din. Ad money will flow
preferentially to luxury online and permission-based marketing.
4. High Definition Drives a
Reversal in Global Standing for U.S. Bandwidth, accompanied by an extraordinary bandwidth increase. Rabbit ratios
(MHz/dollar) jump worldwide, with the U.S. suddenly leading in growth rate. Provision
of 5-10 Mbps will not be unusual in the U.S., which will see the most rapid
bandwidth takeup increase YTY to date, as users start to demand HD-quality
video everywhere. The FCC looks foolish and oh so art deco, again. Australia
5. Fake Internets Become
Serious International Liabilities, as
corporations pressure countries to behave according to international business
norms – specifically, China, Burma, and a handful of other countries with
Fake Internets. Fake Nets imply weakness, government failure, and second-class
status for these countries and their citizens.
If the Net is the source of
intellectual fulfillment and economic growth, exactly which citizens don’t deserve
access? Real Net access is on the path to becoming an international human
6. One-to-One Education Is
Accepted As the Global Goal.
Three-quarters of U.S. school superintendents are planning for it. Maine,
Massachusetts, South Dakota, Michigan, Arizona, Utah; England, Australia, Brazil,
Mexico, Singapore, Nigeria, India, and China are implementing it. If your state
or country is not planning for this, you will be left behind in the 21st
century. Using global digitized knowledge to teach and learn will become the
only obvious solution in education; the goal becomes connecting every child to
this knowledge via the Net.
7. U.S. Healthcare (finally)
Gets Diagnosed, as a result of the
presidential campaign. Reforming healthcare will challenge Iraq as the primary
issue of concern during the year. (In 2009, something gets done about it.)
Among the problems we’ll find:
- Doctors report to HMOs (and not to patients).
- HMOs report to shareholders (and not to patients).
- Insurance companies dictate pricing – often are primarily
in the investment business, but don’t share investment profits
adequately when they come in, and only report directly to shareholders
(not to patients).
- Government programs are rife with fraud by doctors and institutions.
- Defensive medicine is practiced at huge cost increase to avoid lawsuits.
- Over-testing also pays fees to doctors and pays for the
equipment, while acting as lawsuit vaccine.
- There is very little use of IT to reduce costs; the
industry can’t even launch proper Electronic Medical Records. Guess
what? It makes more money re-creating them each time you switch.
- No one reports to the patient, and almost No one gets paid for good health outcomes.
A: There is no penalty for killing your patients.
answers: cap legal awards, make doctors directly responsible to
patients, and remove HMOs and insurance companies from the mix, since
they contribute nothing and take much.
Become Commonplace. Small
personal computers (UMPCs/micro notebooks) gain their own as a category
as these new “CarryAlongs” are introduced by major players – a
trend expanded by the iPhone and currently best served by the Samsung
See a Meaningful Shift into Industrial/Commercial/Residential Use. Pricing drops aggressively, and new uses
and conformations of LEDs become available.
2008: The Year of the First Production and Commercial Sale of
Alternative-Energy Cars in the U.S. Yes, we had the much-missed EV-1 a decade ago, and lots of
golf cart-like things since, but this will be the year of
never-turning-back on commercial alternative-energy vehicles. While GM
dawdles over the Volt, Honda will deliver the hydrogen-powered FCX
Clarity in California. The all-electric Tesla Roadster will be produced
and silently speeding down our streets, with more for sale and new
orders taken for its WhiteStar 5-person sedan. New electric sports cars
from Altairnano, Phoenix Motors, and other California brands will make
seeing an alternative-energy car on the road something new, and more
will also be a hit this year, selling out the U.S. allotment, starting
who care about such things, we keep track of accuracy every year. Here
are the results since we began our New York Dinners, and our Top Ten Next-Year
Predictions: For 2007, 98%; for 2006: 96%; for 2005: 97%.
A cumulative score of 97% since 2005.
video of this talk is available at:
version is at:
comments are always welcome.
Mark R. Anderson
Strategic News Service LLC
Friday Harbor, WA 98250
USA Email: email@example.com
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» Links to More
- SNS New York
Dinner Centerpiece: Mark’s
“Ten Predictions for 2008,” presented December 12th, 2008, at the
Waldorf=Astoria, New York:
the video (Windows Media), download
the audio (MP3), or view the
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» About the Strategic News Service
is the most accurate predictive letter covering the computer and
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» About the Publisher
Anderson is CEO of the Strategic News Service™. He is the
founder of two software companies and of the Washington Software
Alliance Investors’ Forum, Washington’s premier software
investment conference; and has participated in the launch of many
software startups. He regularly appears on the CNN World
News, CNBC and CNBC Europe, Reuters TV, the BBC, Wall Street
Review/KSDO, and National Public Radio programs. He is a member
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» Where’s Mark?
On January 18th, Mark will give his annual Predictions
talk to the Washington Software Alliance TAG group in Bellingham,
WA, at noon, at DIS headquarters. (Last year was a record
turnout, so sign up early.) On March 11th, he will be keynoting
the SVB Financial meeting at the Hotel Sofitel, Redwood City, CA.
On March 20th, he’ll be speaking at the fifth annual SNS London
Dinner, on technology and the global economy. On April 26th and
27th, he will be speaking at the Building Alliances conference in
Dubai. May 20th-23rd, he will be hosting the Future in Review
(FiRe) 2008 Conference at the Hotel del Coronado in San Diego.
In between times, he will be skiing along the peaks and ridges of
his favorite mountains, the Utah Wasatch Range, enjoying family,
friends, and the best snow on the planet.
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