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The Industries Of The Future book summary

The Industries Of The Future book cover

A bird's eye view of what's happening around the world, and the technology trends we can expect to see in the future. A broad range of topics are touched on, such as robots, Bitcoin, Russian cyberwarfare, genomics and the technology hubs / cities of the future. Each section starts with a real-life backstory of something that's been happening in the news, and then leads on to the author's opinions on the general trends we can expect to see over the coming decades.

The book is divided into 6 distinctive chapters:

  1. Robots
  2. Human genomics
  3. The code-ification of money, markets and trust
  4. Cyberwarfare and security
  5. Data: The raw material of the information age
  6. Geography of future markets
  7. Conclusion: The most important job you will ever have

The one theme that I felt was severely lacking was how all of these trends will affect the natural environment in which we live in. I would have been really interested to hear about the author's views on how he sees humans co-existing with earth's other inhabitants, as we immerse ourselves more and more into tech and seek to edit and recreate more and more of our environment and the way in which we live.


  • …technical questions and almost-spiritual doubts - can and should, emotional connections be made between humans and robots?
  • Robots will be the rare technology that reaches the mainstream through elderly users first. [Based on the concept that as the populations of developed nations continue to age, there will be a huge market for care taking robots.]
  • About 70% of total robot sales take place in Japan, China, the US, South Korea, and Germany - known as the “big five” in robotics.
  • This fear [of smart AI robots being a threat to humanity] does not pervade Eastern culture to the same extent [as the West]. The cultural dynamic in Japan [animalism] is representative of the culture through much of East Asia, enabling the Asian robotics industry to speed ahead, unencumbered by cultural baggage.
  • The combination of cultural, demographic, and technological factors means that we will get our first glimpse of a world full of robots in East Asia.
  • Two key developments have dovetailed to make [robot advancement] possible: improvements in modelling belief space and the uplink of robots to the cloud. Belief space is basically the application of algorithms to make sense of new or messy contexts. Linked to the cloud, robots can access vast troves of data and shared experience to enhance the understanding of their own belief space.
  • While weak artificial intelligence, whereby robots simply specialise in a specific function, is currently advancing exponentially, strong artificial intelligence, whereby robots demonstrate humanlike cognition and intelligence, is advancing only linearly.
  • [Talking about driverless cars] Would we accept a computer-based system that produces tens of thousands [of deaths] from driverless cars? Probably not? [My note: Logically, why not? Because human error causes 1 million deaths a year!]
  • Robot derives its etymological roots from two Czech words, rabota ("obligatory work") and robotnik ("serf"), to describe a new class of “artificial people” that would be created to serve humans.
  • Productivity is at record levels, innovation has never been faster, and yet, at the same time, we have a falling median income and we have fewer jobs. People are falling behind, because technology is advancing so fast and our skills and organisations aren’t keeping up.
  • In summary, robots will produce clear benefits to society. It is a net good for the world.

Human genomics

This was the chapter which I felt most uncomfortable about and had a number of opposing reactions to some of the statements and opinions made. Regardless, here are some highlights.

  • Today, there is a complete mismatch between the drug development process and the speed and precision made possible by genomics.
  • The challenge of mental illnesses is that unlike an ailment such as Huntingdon’s disease, which is caused by a single genetic mutation, most mental disorders are caused by many contributing factors. (My note: including the drugs taken?!!)
  • There are concerns that as genetic testing becomes more common, our society won’t handle the risk information well. (My note: lots of ethical questions abound)
  • Another set of concerns about the rise of medicines rooted in our genetics comes from people who worry that the development of next-generation drugs arising from genomics will reduce people’s focus on diet, environment, and lifestyle, which also damages DNA and cause cancer. (My note: exactly - nature vs. nurture debate)
  • The process called xenotransplantation, involves modifying a pig genome so that a pig embryo can grow up with organs that can be harvested and transplanted into human beings. (My note: and what about animal rights? This is pretty screwed up IMO.)
  • As our ability to manipulate life grows stronger, it needs to be governed by our human judgement.
  • Some of its researchers [referring to China] are in early discussions about eventually sequencing the genomes of almost every child in China
  • One Chinese CEO told me he believes that the wealth and power that came from being the centre of the Internet’s commercialisation extended America’s reign as a superpower by ten years. Many of the most powerful Chinese leaders believe that genomics is the next trillion dollar industry…
  • One large category of revenue [for a Chinese government-owned genomics research company] is “anonymous donations”. [My note: slightly worrying…what are their intentions? We are dealing with very personal data.]
  • Can we divide that expertise and train an entire village halfway around the world to become the globe’s expert on a single part of the body for one specific disease? [My note: interesting concept but the human body should be looked at as a whole]

The code-ification of money, markets and trust

  • The codification of money, markets, payments and trust is the next big inflection point in the history of financial services. (My note: Jeremy Liew talked about Bitcoin growing fastest in countries without strong financial markets, which relates well to the “codification” of trust.)
  • Square and its competitors are trying to:
    • Reduce friction in the marketplace (dial down the complication and the tens of billions of dollars spent…)
    • Facilitate a shift away from the multinationals and the corporations into local entities
    • Combat the inequality that has proliferated alongside innovation
  • Palestinian lady graduate: "We must have 3G to have a better economy”. Without it, there is no business or economy. This leads to unemployed engineers. Radicalisation, unemployment and engineering skills are a dangerous combination.
  • Paypal is banned in places like West Bank, Pakistan, Lebanon and Afghanistan (due to potential terrorist financing)…but it is precisely these places that need these financial services and systems the most
  • In refugee communities, mobile phones were how families were able to keep track of one another after they had been displaced. The mobile phones also enabled residents to store what little money they had inside mobile accounts (more difficult to steal than cash).
  • Beyond greater efficiency, one of the other major effects of coded money is an increase in trust and a decrease in corruption
  • When it comes to coded trust, eBay offered the first major breakthrough. The next leap forward in the code-ification of trust and markets is in the so-called sharing economy. Think of the sharing economy as a way of making a market out of anything and a micro entrepreneur out of anybody.
  • [Re: Airbnb] To the extent that there is an underlying ideology, it is not about sharing or creating community around the breakfast table; it is the economic theory of neoliberalism, encouraging the free flow of goods and services in a market without government regulation.
  • With these platforms [Uber, Airbnb, etc.], the Valley has become like ancient Rome. It exerts tribute from all its provinces. The tribute is the fact that it owns these platform businesses. [My note: e.g. money from local economies, say drivers in India, are now being sent to Silicon Valley via Uber]
  • The counter-arguments to this are:
    • The near-inevitable fact that the large platforms in Silicon Valley will be going public (distributed ownership)
    • [These platforms] are strengthening the working and middle classes. In most of these cases, the good being sold is a latent good. Platforms are also extending economic activity into diverse communities.
    • Finally, these platforms extends the opportunity of supplemental income to hundreds of thousands of households.
  • For millennials, the application of lodging, labour, and travel is more native and gives credence to the idea that the sharing economy is only in its earliest stages.
  • Imagining what’s next…sharing economy will come to include more specialised forms of labour. [My note: Sharing economy works best for you only if your skill is in high demand]. If more of the labour force is sharing economy-based temporary employment without benefits, it hammers the working class and pushes them into safety-net programs. Worker protections have shifted from employers to taxpayer-funded government programs.
  • Trust has become codified, and the role of the state as regulator has been diminished
  • As the sharing economy has grown as a proportion of the total economy, the safety net needs to grow with it. The platform owners can and should help pay for the added costs to society.
  • In the old model, established institutions functioned as an agent of trust, protecting parties from fraud. Bitcoin comes from a community that does not trust the old order. They seek to establish a trust-based financial system amongst themselves, relying on algorithms and encryption.
  • By making everything public, the block-chain reduces the possibility of fraud drastically, because you can’t counterfeit the existence of property in public view. Fraud is further diminished by the fact that every bitcoin carries its history with it.
  • Bitcoin’s ledger updates at regular intervals, pooling every private-key-verified transaction that has been conducted on the network since the last update and lumping them into a big block that can be added to the ledger. Because the algorithm is difficult to solve but easy to check, it serves as a reliable signal for telling the entire network when to update. And because the algorithm has a random element, every computer in the network has a chance of solving it, which prevents any lone powerful computer from seizing central control.
  • Benefits of using Bitcoin or a crypto-currency:
    • Non-functioning markets - Marc Andreessen: Only about 20 countries around the world have fully modern banking and payment systems. As a result, many people in many countries are excluded from products and services that we in the West take for granted.
    • Reduction of fees - Handing 2.5% to banks to move bits around the Internet is the worst possible choice (inefficient).
    • Microcharges - Ability to be subdivided into micro payments which could have positive effects on content providers such as the newspaper industry. Microcharges could also be used to combat spam.
  • The problem with Bitcoin is that even though the blockchain has never been hacked, just about everything around it has been.
  • Bitcoin has made it easier for law enforcement agencies to track the flow of money. Although the blockchain keeps personal identities secret behind cryptographic code, in order to access the blockchain, people must leave digital footprints. Ultimately, we may find agencies being pro-Bitcoin, with libertarians being anti-Bitcoin. [My note: the opposite of its founding ideology?]
  • The blockchain will be to banking, law and accountancy as the internet was to media, commerce and advertising. It will lower costs, disintermediate many layers of business and reduce friction.
  • The necessary big change for Bitcoin when it comes to such major transactions is the use of real identity. No more anonymous accounts. The blockchain’s engineering could remain decentralised, but there would need to be some multi stakeholder institutions in place to help govern the blockchain, in the same way that the Internet is decentralised but has organisations running processes like domain name registration.

Cyberwarfare and security

  • There are 3 main types of cyberattacks today: attacks on a network’s confidentiality, availability and integrity
    • Attacks that compromise confidentiality aim to steal or release secure information like credit card numbers from a given system in an illicit or unauthorised manner
    • The second type of cyberattack hits a network’s availability - denial-of-service (DoS) or distributed-denial-of-service (DDoS). The aim is to flood a network with a massive number of requests to render it inoperable.
    • The last type of attack is more physical in nature. They alter or destroy computer code, with the aim of causing damage to hardware, infrastructure or real-world systems.
  • The most sophisticated governments in the cyberdomain are the United States, China, Russia, Israel, Iran and the United Kingdom, each with different boundaries for what is and is not allowable behaviour
  • Cyber was declared a domain of warfare by the US in 2011, alongside air, land, sea and space
  • Anything approximating corporate espionage is not allowed in the US domain. It is illegal to steal trade secrets of any foreign companies and hand them over to American companies. On the other hand, China’s most powerful cyberattacks have been in corporate espionage.
  • The Chinese are taking advantage of the grey area that surrounds cyber in the international arena. They are able to engage in cyberattacks without triggering extensive sanctions or punishments for treaty violations. They have a financial and political stake in things staying calm; they have incentives to steal but not to break.
  • The streamlined systems that make everyday life easier for you can also be used to make life a whole lot worse [in relation to connected homes]
  • …the prevention of the worst kind of cyberattacks, like those against power plants or air traffic control systems, falls into the domain of government. [Jim Gosler] believes that democratic governments need to both recruit the right people and foster a close relationship between the public and private sections to guard against major threats.
  • Cybercombat is a distinctly 21st century form of conflict, and the norms and laws that were developed in prior centuries simply do not apply. The weaponisation of code is the most significant development in warfare since the development of nuclear weapons. The confounding factor when it comes to cyberwar is that the barriers to entry are so much lower in cyber than in any other domain.
  • The nonphysical nature of cyber conflict has also made the private sector a combatant. Since national borders have much less meaning online, there’s little to stop hackers from going right for the valuable assets.
  • The layout of the Internet scrambles the traditional idea that both sovereign countries and warfare are tied to geography and physical place. If networks and servers of a company are attacked, is it the responsibility of the headquarters country or the country where the servers are located?
  • There is little to no prospect for any sort of short-term progress to be made developing international law, treaties or other frameworks establishing norms and rules for cyber activity. The US won’t agree to anything the Europeans would demand that limits intelligence-gathering activity. [My note: What’s the balance between governments protecting us and too much government surveillance? Who to trust?]
  • [Cybersecurity industry] will continue to grow, likely on an exponential curve because it’s going to follow the Internet itself.
  • Government has a responsibility to protect its people, not just its big businesses and infrastructure. Government can and should work extensively with the private sector to make sure that the brightest minds are working to develop cyberdefenses.
  • We all want the liberty that comes with a vibrant online life, but liberty without security is fragile, and security without liberty is oppressive

Data: The raw material of the information age

  • As recently as 2000, only 25% of data was stored in digital form. Less than a decade later, in 2007, that percentage had skyrocket to 94%. It has continued to rise.
  • 90% of the world’s digital data has been generated over the last 2 years
  • The value derived from big data is partially a function of the amount of data created and our new ability to use that data in real time to make smarter, more efficient decisions. Big data is further aided by new developments in data visualisation that allow humans to see and understand patterns that might not be apparent.
  • Universal machine translation will accelerate globalisation on a massive scale. The next wave of globalisation will open up communication by removing the need for a shared language.
  • As with any new technology, the rise of universal machine translation will have its downsides. 2 in particular:
    • The near obliteration of a profession (translators)
    • The increased risk of fraud (intercepting and altering messages prior to receipt of translated message)
  • One out of every 9 people on earth do not have enough food to live a healthy, active life. As the world’s population is expected to grow to more than 9 billion people over the next 30 years, the amount of food produced will need to increase by 7%.
  • Small farmers are likely to derive as much benefit from precision agriculture as large farmers with thousands of acres. The expensive software is in the cloud and accessible on cheap devices (thus making this technology available to all farmers).
  • Precision agriculture will not end hunger in India or turn its subsistence-level farmers into serious agribusinesses, but in an environment of scarcity, it can take those scarce resources, be they seed, fertiliser or water, and get the most out of them
  • New data will allow us to significantly reduce the amount of chemicals we put on farm fields, which will in turn reduce the amount that ends up in water, air and food.
  • The application of big data to enhance operations and product development in retail banking is called “fintech"
  • “What is a bank?”. A bank is a giant ledger that records how much money belongs to people and how much money people owe them. At heart, that's a data problem.
  • Banks are very restricted in their operations. Regulators are very scared of innovation. The reason they are uncomfortable is the reason we should all be uncomfortable: banks aren’t really meant to make money. They’re meant to serve as rock solid repositories for other people’s money.
  • Could you actually operate a bank like a technology company? The answer is probably no. The simplest reason (which is what every regulator has said): they are uncomfortable with a bank that grows more than 20% year over year. The number one historical indicator of a bank that is about to go belly-up is one that has a lot of growth. But a good startup grows 20% month on month.
  • [On educating your children] The “data talk” will now be a mandatory part of growing up and that it should come even before the proverbial birds and bees talk (since there will be a huge host of data on every individual from all aspects of their life, which will follow them through life)
  • Many European governments have established strong privacy regulations. The problems they are encounter however, are two-fold:
    • Most big data technologies do not collect information and organise its collection or distribution by country
    • When countries try to disallow their companies from building products that impinge on privacy regulations, they are dialing down their ability to compete in one of the fastest growing segments of the global economy. Restricting access to data in tomorrow’s economy is akin to regulating land use during the agricultural age.
  • These countries find themselves in a double bind: in order for regulation to serve the public interest, it must be enough to protect individual and community rights but not so much as to eliminate investment and economic growth.
  • If the world ten years from now is a world without privacy, everybody will have a scandal. In that world, the very idea of what is scandalous behaviour has to change.
  • Philosophically, there has been a longtime fear with the rise of robotics and automation that machines will become more human - potentially supplanting “us” by taking our jobs or literally taking over. In the big data world, the new fear is that humans will become more like machines.
  • “It’s not just choice that we’re in danger of giving away; it’s often our own creativity and ownership.” - Who owns the data that is being produced?
  • Who owns the data is as important a question as who owned the land during the agricultural age and who owned the factory during the industrial age. Data is the raw material of the information age.
  • When data goes from being unstructured to structured, it takes on the values and prejudices baked into its formulation.
  • Correlations made by big data are likely to reinforce negative bias. Because big data often relies on historical data, or at least the status quo, it can easily reproduce discrimination against disadvantaged racial and ethnic minorities
  • Big data tools work best when governed by human judgment
  • The choices we make about how we manage data will be as important as the decisions about managing land during the agricultural age. We have a short window of time before a set of norms set in that will be nearly impossible to reverse.

Geography of future markets

  • Domain expertise for the industries of the future is still broadly distributed i.e. the most important and interesting innovations are taking place with greater geographic spread than we see with Internet-based innovation.
  • In the current landscape, the most important work in the commercialisation of genomics is clustered around universities where much of the original research and development took place.
  • Countries with high education and low wages will export IQ. What you’ll get is a massive mean reversion of income throughout the world where the Valley, Israel and China and maybe a few other places get very high economic returns and everywhere else in the world starts to revert to the mean.
  • Silicon Valley can be a little too navel-gazing. 90% of the region’s entrepreneurs focus on 10% of the world’s problems.
  • Data will become widely useable and scalable enough that it won’t have domain expertise in the same way that other high-barrier-to-entry industries of the future like genomics or robotics do.
  • New Zealand is applying big data to agriculture in a very effective way. They may not have a deep history of big data and analytics but have domain expertise in another industry that knows where and how analytics would add value. [It's the intersection of local, domain knowledge and big data analytics that's interesting.]
  • Strategies for countries, companies and people are much more about building on your strength rather than offsetting your weaknesses. This effectively means to stop trying to chase after Silicon Valley and focus on the skills and processes that will unleash the next wave of innovation in the fields in which there is already local expertise.
  • An important aspect of what makes major cities thrive is infrastructure, along with the analytics programs that allow people to use that infrastructure more efficiently
  • Cities that are aspiring to become global hubs, like Jakarta, Sao Paulo and Mumbai, need to simultaneously invest in physical infrastructure and the big data applications that often attach to this infrastructure. This helps create the conditions that attract investors and entrepreneurs.
  • Cities that have historically been open to the world are linked by a culture that welcomes people from all corners of the globe and encourages the free flow of ideas and goods to make them attractive places to live and work.
    • Economic openness - get rid of friction that costs time and money to get business done
    • Political openness - ensuring everyone in a society can gather, meet, work and speak without the friction of undue censure of discrimination
  • To be successful in the next wave of globalisation and innovation, a society must be open in order to exchange new ideas, conduct research free from political interference and pursue creative projects, even if they fail.
  • [Why Russia will not succeed] Putin does not understand, or does not care about, the basic reality of how growth in the global economy is now produced. Locked in a 19th-century mind-set in which land, power and people are physically controlled, Putin is missing the reality of power in the 21st century.
  • [How Estonia is innovating to attract the most talented workers globally] You can now use your Estonian e-residency for a variety of things, such as doing business throughout the EU and leveraging its online-only programs for contracting and tax filing. No more paperwork, lower taxes, and all the freedom that comes with being an incorporated business in the EU.
  • [In Estonia] all schoolchildren are taught how to code beginning in the first grade.
  • Information no longer flows exclusively from mainstream media and government out to society. It flows in a vast network of citizens and consumers interacting with once-dominant information sources. How states respond to this systemic loss of control and the diffusion of power will greatly affect the character and performance of their economies.
  • Some societies have managed to rise in recent decades by opening up economically and socially while restricting political openness. Whether this is a viable long-term strategy remains to be seen, but countries grappling with hybrid models such as Singapore, China and India are worth examining.
  • China has demonstrated that a somewhat open economy and a closed political system can achieve growth by being home to knowledge workers and manufacturing centres. It is now seeking to prove that it can provide the conditions for innovation of its own.
  • [China] leads the world in infrastructure investment, a buildup that has directly contributed to its manufacturing sector, and it has enacted a forced urbanisation policy to keep manufacturing wages low. However, these policies have come with considerable human and environmental costs.
  • India has neglected primary education, leading to widespread inequality of opportunity
  • The progress of women in Chinese society over the course of decades is one of the major reasons it is the economic power it is today. Half of the world’s wealthiest female billionaires live in China.
  • [In India and parts of Asia] there are societies where young parents often live with their parents, or live next to their parents. Caregiving has adapted to the economy. The norms are that in their 20s and 30s, the young parents work to earn a living, and in their 50s and 60s, they raise the grandchildren.
  • A second major condition necessary for societies to compete and succeed in the industries of the future is to have young people whose ideas are funded and whose place on organisational charts belies their youth. [My note: a particular problem in Asia and Europe… not so much Silicon Valley.]

Conclusion: The most important job you will ever have

  • Multicultural fluency is increasingly important in a business world that is growing more global. Today’s kids must also become fluent in a technical, programming or scientific language.
  • Jack Dorsey: [Learn a programming language] because it teaches you how to think in a very, very different way. It teaches you about abstraction around breaking problems into small parts and then solving them, around systems and how systems interconnect.

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