17.12.2019

Drivers For Change In The Personal Computer Industry

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Executive SummaryReprint: R0410EIt’s fairly obvious: To make intelligent investments within your organization, you need to understand how your whole industry is changing. But such knowledge is not always easy to come. Companies misread clues and arrive at false conclusions all the time.To truly understand where your industry is headed, you have to take a long-term, high-level look at the context in which you do business, says Boston University professor Anita McGahan. She studied a variety of businesses from a cross section of industries over a ten-year period, examining how industry structure affects business profitability and investor returns. Her research suggests that industries evolve along one of four distinct trajectories— radical, progressive, creative, and intermediating—that set boundaries on what will generate profits in a business. These four trajectories are defined by two types of threats. The first is when new, outside alternatives threaten to weaken or make obsolete core activities that have historically generated profits for an industry.

The second is when an industry’s core assets—its resources, knowledge, and brand capital—fail to generate value as they once did.Industries undergo radical change when core assets and core activities are both threatened with obsolescence; they experience progressive change when neither are jeopardized. Creative change occurs when core assets are under threat but core activities are stable, and intermediating change happens when core activities are threatened while core assets retain their capacity to create value.If your company’s innovation strategy is not aligned with your industry’s change trajectory, your plan for achieving returns on invested capital cannot succeed, McGahan says. But if you understand which path you’re on, you can determine which strategies will succeed and which will backfire. You can’t make intelligent investments within your organization unless you understand how your whole industry is changing. If the industry is in the midst of radical change, you’ll eventually have to dismantle old businesses. If the industry is experiencing incremental change, you’ll probably need to reinvest in your core. The need to understand change in your industry may seem obvious, but such knowledge is not always easy to come.

Companies misread clues and arrive at false conclusions all the time. Sotheby’s, for example, invested in online auctions (its own Web site as well as a venture with Amazon) as if the Internet were just another channel; in truth, the new technology represented a fundamental shock to the industry’s structure.To truly understand where your industry is headed, you have to shut out the noise from the popular business press and the pressure of immediate competitive threats to take a longer-term look at the context in which you do business. That is what some of my colleagues and I did. The research described in this article is based on a high-level look at a variety of businesses from a broad cross section of U.S. The research, which began in the early 1990s and continues today, originally focused on how industry structure affects business profitability and investor returns. This statistical analysis yielded several hypotheses about how industries evolve, which were then tested and refined in a series of case studies on industry structure, industry change, and competitive advantage.The conclusion, which I’ll oversimplify here for the sake of clarity, is that industries evolve along four distinct trajectories—radical, progressive, creative, and intermediating. 1 Moreover, a firm’s strategy—its plan for achieving a return on invested capital—cannot succeed unless it is aligned with the industry’s change trajectory.

The four trajectories set boundaries on what will generate profits in a business. Many companies have incurred losses because they tried to innovate outside of those boundaries. One of the most famous examples is Xerox, which is legendary for its innovations and for its struggle to harvest profits from them. By the mid 1980s, the copier manufacturing industry had matured around a business model that emphasized creative “hit products.” Meanwhile, the personal computing industry was in its infancy, and even though Xerox PARC had pioneered PC inventions such as the graphical user interface and the mouse, the company was unable to make inroads in this burgeoning industry that required an entirely new set of business activities. Industries evolve along four distinct trajectories—radical, progressive, creative, and intermediating—that set boundaries on what will generate profits in a business.No innovation strategy works for every company in every industry. But if you understand the nature of change in your industry, you can determine which strategies are likely to succeed and which will backfire.

Four Trajectories of ChangeBefore we look at the four trajectories of industry evolution in depth, it is worthwhile to recognize that they are defined by two types of threats of obsolescence. The first is a threat to the industry’s core activities—the activities that have historically generated profits for the industry. These are threatened when they become less relevant to suppliers and customers because of some new, outside alternative. In the auto industry, for example, many dealerships are finding that their traditional sales activities are less valued by consumers, who are going online for data on the characteristics, performance, and prices of the cars they want. The second is a threat to the industry’s core assets—the resources, knowledge, and brand capital that have historically made the organization unique.

These are threatened if they fail to generate value as they once did. In the pharmaceutical industry, for instance, blockbuster drugs are constantly under threat as patents expire and new drugs are developed.The exhibit “Trajectories of Industry Change” maps the relationships between these two threats and the following four change trajectories. Radical change occurs when an industry’s core assets and core activities are both threatened with obsolescence. This trajectory is closest to the concept of disruptive change that Harvard’s Clayton M. Christensen discusses.

Under this scenario, the knowledge and brand capital built up in the industry erode, and so do customer and supplier relationships. During the 1980s and 1990s, an estimated 19% of U.S.

Industries went through some stage of radical change. A good example is the travel business. Agencies’ core activities and core assets came under fire as the airlines implemented systems to enhance direct price competition (such as SABRE and other reservations systems) and as the agencies’ clients turned to Web-enabled systems (such as Expedia, Orbitz, and Travelocity) that offered new value (online monitoring of available flights and fares, for instance). Trajectories of Industry ChangeWhen neither core assets nor core activities are threatened, the industry’s change trajectory is progressive. Over the past 20 years, this has been by far the most common trajectory; about 43% of U.S. Industries were changing progressively, including long-haul trucking and commercial airlines.

In those industries, the basic assets, activities, and underlying technologies remained stable. Innovators like Yellow Roadway, Southwest, and JetBlue succeeded not because the incumbents’ strengths became obsolete but because the upstart firms had smart insights about how to optimize efficiency.The other two change trajectories— creative and intermediating—have been neglected in the management literature, possibly because of their nuances. Creative change occurs when core assets are under threat but core activities are stable.

This means that companies must continually find ways to restore their assets while protecting ongoing customer and supplier relationships; think of movie studios churning out new films or oil companies mining for new wells. About 6% of all U.S. Industries are on a creative change trajectory. A Fair Share?Intermediating change occurs when core activities are threatened with obsolescence—customer and supplier relationships are stretched and fragile—while core assets retain their capacity to create value. Sotheby’s, for instance, is as good as it ever was at assessing fine works of art, but, because of the technology that made eBay possible, the auction house’s matchmaking activity no longer creates as much value. The challenge under intermediating change is to find ways to preserve knowledge, brand capital, and other valuable assets while fundamentally changing relationships with customers and with suppliers.

During the 1980s and 1990s, approximately 32% of U.S. Industries went through some form of intermediating change. Radical ChangeRadical transformation occurs when both core activities and core assets are threatened with obsolescence.

The relevance of an industry’s established capabilities and resources is diminished by some outside alternative; relationships with buyers and suppliers come under attack; and companies are eventually thrown into crisis. Radical industry evolution is relatively unusual.

It normally occurs following the mass introduction of some new technology. It can also happen when there are regulatory changes (as in the long-haul, trunk-route airline industry of the 1970s, for example) or simply because of changes in taste (U.S. Consumers’ retreat from cigarettes over the past 20 years, for instance). The creative change trajectory, like the intermediating trajectory, has not been studied extensively. It is easy to mistake it for radical change, despite the stability of relationships within the network. When this mistake is made, companies can overreact and neglect important relationships that are critical to their profitability. For example, some pharmaceutical companies became so focused on emerging methods of drug discovery that they invested capital exclusively in new research relationships and did not develop appropriate sales forces in new markets.Innovation under creative change occurs in fits and starts.

Although there are several long-standing formulas for making hit movies, for example, occasionally a new genre or technical approach to filmmaking emerges. Similarly, companies in the pharmaceutical industry have been experimenting with new methods of drug discovery over the last 15 years. Despite these changes, the companies that lead these industries are not new entrants. They have retained their strength by capitalizing on their networks of relationships.There are many ways for companies in an industry on a creative change trajectory to generate strong returns on invested capital. For instance, the leading companies in these industries tend to spread the risk of new-project development over a portfolio of initiatives.

As a result, their returns are less volatile than those of smaller competitors. Other tactics include outsourcing project management and development tasks.

Progressive ChangeProgressive evolution is like creative evolution in that buyers, suppliers, and the industry’s incumbents have incentives to preserve the status quo. The difference is that core assets are not threatened with obsolescence under progressive change, so industries on this trajectory are more stable than those on a creative change trajectory. Today’s discount retailing, long-haul trucking, and commercial airline industries are evolving in this way.Progressive evolution is most similar to the kind of change that Christensen refers to as “sustaining.” Progress occurs, and technology can have an enormous impact, but it happens within the existing framework of the business. Core resources tend to appreciate rather than depreciate over time. Progressive change doesn’t mean that change is minor or even that it is slow. Over time, incremental changes can lead to major improvements and major changes.

Think of what has happened in discount retailing over the last ten years. Wal-Mart’s cumulative impact has been extraordinary, and the company has developed unprecedented clout. But the retailer developed that advantage by deepening existing customer and supplier relationships, not by seeking out entirely new ones.The most profitable corporate strategies in progressive change industries generally involve carving out distinct positions based on geographic, technical, or marketing expertise. The goal is to build resources and capabilities steadily and incrementally.

Companies rarely get into brinkmanship or eyeball-to-eyeball competition, and they don’t have to put large amounts of capital at risk before learning whether an innovation creates value. Instead, their performance depends on their quick responses to feedback. Southwest Airlines, for instance, tests new flight routes but isn’t afraid to pull out if a route ultimately doesn’t work under the company’s approach to air travel.Successful companies in progressive change industries tend to be viewed by the financial community as minimally risky with the potential for only moderate returns. Over the long run, though, these companies can actually create very large total returns for investors. Money has reported that the two companies that had generated the greatest total return to shareholders during the magazine’s 25-year history were none other than Wal-Mart and Southwest. Which Trajectory Are You On?Identifying your industry’s evolutionary trajectory on the fly is difficult.

It is easy to become distracted or confused by conventional wisdom, customer demands, and competitors’ moves. To ensure accuracy, your analysis must be focused and systematic.The first step is to define your industry. You can begin by identifying the companies in your industry that share common buyers and suppliers. Many economists use a 5% rule to assess whether the commonality is sufficient to qualify the firms as direct competitors: If a 5% price fluctuation by one company causes customers or suppliers to switch to another company, the businesses qualify as direct competitors. When a group of companies intend to appeal to the same buyers and rely on the same suppliers, you have additional evidence that they are direct competitors. And when companies use similar technologies to create value, it is likely that they qualify as direct competitors.The second step is to define the industry’s core assets and activities. Here is an easy way to test whether something is core: If it were eradicated today, would profits be lower a year from now, despite efforts to work around what’s missing?

If the answer is yes, then it definitely qualifies. In the auctioneering industry, for example, the capacity to evaluate works of art is a core activity. In the soft-drink industry, Coca-Cola’s brand is a core asset. The disappearance of either of these capabilities would seriously damage profitability in their respective industries.The third step is to determine whether the core assets and activities are threatened with obsolescence. To qualify, the threat must make core assets and activities potentially irrelevant to profitability. It must be significant enough to jeopardize the survival of at least one industry leader and widespread enough to influence every company in the industry.

Once you know whether core activities and assets are threatened, you can identify which of the four trajectories applies to the industry you are studying.The final step in the diagnosis is to evaluate the phase of the evolutionary trajectory. This step is important: Industry change generally takes place over a long period, and the options for dealing with change typically drop off sharply through each phase.

(See the sidebar “The Industry Life Cycle Revisited.”) The Industry Life Cycle Revisited. Once you’ve determined which change trajectory your industry is on, you’ll need to figure out which phase of change the industry is experiencing.

The classic industry life cycle model is relevant for understanding the phases of progressive and creative change. But this model does not apply to industries that are experiencing radical or intermediating change.In the traditional life cycle model, industries begin in a period of fragmentation as companies experiment with different approaches to a market. The companies offer a variety of products and operate at low volumes. They tend to be entrepreneurial, private, and focused on serving narrow geographic areas. Over time, the industry experiences a shakeout, usually because a specific business model achieves greater legitimacy than any other. Competitors become more efficient, the volume of sales increases, and the industry generates unprecedented value for suppliers and buyers. When industries reach maturity, sales growth slows, and leaders often lock their positions.

As the volume of sales drops, industries move into decline. In this phase, companies often search for incremental improvements in efficiency to recover profitability.

(See “The Traditional Model.”). But if you apply this model in industries that are experiencing radical or intermediating change, you may end up trying to renew your position in an industry that will no longer generate significant returns. Or you may end up missing opportunities in both the established and emerging industries.A more accurate model for those on radical or intermediating trajectories is the one below, which reflects changes in the ways buyers and suppliers respond to the level of the threat of obsolescence.

(See “An Alternate Model.”) During an initial period of emergence, upstart firms warrant attention but may not be significant enough to prompt established companies to restructure. As the new approach converges in volume, established companies may react by reconfiguring some of their activities. During a period of coexistence, buyers and suppliers become increasingly sophisticated at evaluating the new approach, and as a result, new opportunities for value creation may emerge even in the old industry. During a final phase of dominance, the industry’s products and services are evaluated on new criteria that reflect the popularity of the new approach.

It is also essential to note that an industry generally evolves along just one trajectory at a time. It almost always starts out on either a progressive or creative trajectory because, collectively, companies in the industry can’t capture value without a clear model for organizing their core activities. Over time, the industry may feel pressure to change these activities—driven by, for example, customer demands and new technologies. The threat of obsolescence can catapult the industry on to either a radical or an intermediating trajectory.

As the industry restructures its core activities and assets, the threat of obsolescence may fade, marking the industry’s transition back to a progressive or creative trajectory. A company that has survived these transitions can sometimes retain profitability, although it almost always must operate at a smaller scale and with a very different approach.Industries do not shift their trajectories very often; no industry that I have studied has shifted between evolutionary paths more than once in ten years. So it is a good bet that a given industry has been on a single evolutionary trajectory for at least a few years.

And while it is sometimes possible for individual companies to influence the trajectory of an entire industry, the effort required is almost always too great to be worthwhile, and failure can be devastating to the company’s profitability or even its survival. Capitalizing on Industry EvolutionUnderstanding industry change can do more than help you avoid mistakes. The rules under each trajectory can help you forecast early on how change will occur in your industry—and help you determine how to exploit change as it occurs. It would be impossible to list here all the possible contingencies for change on each trajectory and at each stage. But here are a few general insights: Analyzing Radical and Intermediating Change.As noted earlier, companies operating in an industry that is on a radical or intermediating change trajectory must perform a balancing act—aggressively pursuing profits in the near term while avoiding investments that could later prevent them from ramping down their commitments. To get the right balance, put yourself in the suppliers’ shoes as well as in those of the buyers. What new options are emerging?Take the example of auto dealerships, which are on an intermediating change trajectory.

They are locked into multiyear pacts with the manufacturers, their suppliers. Yet the intermediation of the dealers presents new opportunities for the automakers to relate to consumers: What are the trade-offs for the manufacturers if they advertise collaboratively with the dealerships rather than directly to consumers? How can the carmakers pull off something like this without violating their contracts with the dealers? Only with unconventional thinking—beyond standard market research and advertising plans—can the manufacturers find answers to these questions.Radical and intermediating change also call for new ways of dealing with competitive threats. Instead of viewing rivals in conventional terms, consider whether you can use alliances to protect common interests and defend against new competition from outsiders—or to facilitate consolidation. When some regions of the U.S. Became overcrowded with auto dealerships, affiliated car lots (Honda dealers in adjacent towns, for instance) merged.Under radical and intermediating change, it is also important to interpret conflict within your organization in a new way.

“Civil wars” can emerge within an organization as divisions with exposure to different segments of the business develop opposing views about the nature and pace of change. It is uncanny how frequently this happens. Strong, central leadership is required to deal with the problem effectively. Surviving Radical and Creative Change.Under these conditions, it is smart to evaluate how quickly your core assets are depreciating. The easiest way to do this is to identify how much you are spending to renew them. Investing in a full-blown cost-accounting effort is worthwhile since the value of your assets may vary across different segments of the business in surprising ways. The goal of this analysis should be to distinguish the segments in which you can protect your competitive position from those in which your position will erode quickly.

Often, this assessment yields important information about the value of intellectual property and how it can be guarded more intensively. For example, a film studio might discover that, in some geographies, losses from video piracy outweigh the potential profits from distributing content, at retail, on videotape or DVD.To navigate radical and creative change trajectories successfully, companies must have the mettle to disappoint some buyers and suppliers, regardless of their track records, if the risks are too high. Despite Marlon Brando’s box-office successes during the 1950s, film studios were reluctant to work with him because of his personal idiosyncrasies. The stakes in developing new films are simply too great for producers to take many risks. Because of the volatility of new-asset development, it is also crucial to cultivate relationships with investors to ensure quick access to capital when a worthwhile project comes around. Managing Progressive Change.Progressive change is not simple to manage, despite the fact that neither core assets nor core activities are threatened.

The accumulated impact of incremental changes can raise the standards for doing business to the point where only a handful of companies are competitive. For example, the standard-bearers in discount retailing (Wal-Mart and Target among them) have relentlessly managed incremental changes in activities for decades. As a result, only a few national retailers have competitive cost structures on a large scale. Ultimately, one of the most successful strategies for companies in industries on a progressive change trajectory is to develop a system of interrelated activities that are defensible because of their compounding effects on profits, not because they are hard to understand or replicate.

Consider that very little about Wal-Mart’s approach is secret. The company’s efficiencies have accumulated ever since Sam Walton built his first distribution centers decades ago.

Adapting to the Stages of Change.As we’ve noted, all four trajectories typically unfold over decades, which means organizations have time to outline strategic options for the future. As change happens, fighting it is almost always too costly to be worthwhile. In the late stages, companies invite trouble by sticking with outdated budget systems and cost-accounting processes. Organizations must reconfigure themselves for lower revenue growth and develop the ability to move activities and resources out of the business. Diversifying Your Business.Some of the most exciting opportunities associated with industry evolution relate to diversification across industries.

By participating in more than one industry on a progressive trajectory, Wal-Mart has enhanced the effects of its powerful distribution systems. And with its acquisition of Kinko’s, FedEx has diversified in response to radical change. Some of the major challenges of diversification have to do with sharing core activities and core assets across divisions on different trajectories, and developing clear lines of authority for resolving disputes between divisions as their industries create different investment requirements. It is virtually impossible to diversify profitably without understanding the differences in the trajectories and phases of industry change.The trajectories outlined above can help you anticipate how change will unfold in your industry—and how to take advantage of opportunities as they emerge. To get out from under industry threats, your company must cultivate a deep understanding of how changes to the industry will unfold over time. How will buyer and seller relationships be affected? And are intangible assets like brand capital and knowledge capital truly adaptable across industries?

The work of systematically analyzing the business environment is not easy, but the payoff is great: better strategic decision-making for your company.1. This article builds on the author’s “How Industries Evolve,” Business Strategy Review, Autumn 2000.

Get our daily newsletterUpgrade your inbox and get our Daily Dispatch and Editor's Picks.Put an Ood onto public transport anywhere in the developed world, though, and—tentacles apart—he would barely raise a questioning eyebrow. The other passengers would be too busy paying attention to the parts of their brain that they now carry in their hands to notice anything particularly odd about an alien doing something very similar.There are 2 billion people around the world using smartphones that have an internet connection and a touchscreen or something similar as an interface. By the end of the decade that number looks set to double to just over 4 billion, according to Benedict Evans of Andreessen Horowitz, a venture-capital firm. Already hugely attractive—an estimated 500m will be sold in China this year—smartphones are getting both more useful at the top end and much cheaper at the bottom. The most popular brand in India, Micromax, sells basic models for under $40.

Once phones are established in a market the expectation that everyone will have one—what Rich Ling of the Nanyang Technological University in Singapore calls the “mobile logic”—forces them even into initially reluctant hands, making them end up ubiquitous.The success is not a story of phones alone. From 2009 to 2013 the mobile industry invested $1.8 trillion on improving its infrastructure around the world, according to the Boston Consulting Group. Download speeds have increased by a factor of 12,000 and data rates have dropped to a few cents per megabyte (see chart 2). Along with Wi-Fi in homes and offices this has made it feasible to add to the phones’ own computing power that of data-centres far away. Amazon Web Services, the world’s biggest provider of such cloud computing, says it is now adding as much server capacity every day as its e-commerce parent required to run its entire global infrastructure ten years ago. Let it ring a little longerBy 2020, something like 80% of adults will own a smartphone connected to this remarkable global resource. If they are anything like today’s Europeans and Americans, who are leading in these matters, they will use them for about two hours a day; if they are like today’s European and American teenagers they will use them more than that.

The idea that the natural place to find a computer is on a desk—let alone, before that, in a basement—will be long forgotten.Like the book, the clock and the internal combustion engine before it, the smartphone is changing the way people relate to each other and the world around them. By making the online world more relevant, and more applicable, to every task from getting from A to B to finding a date to watching over a child to checking the thermostat it is adding all sorts of convenience. Beyond convenience, though, a computer that is always with you removes many previous constraints on what can be done when and where, and undermines old certainties about what was what and who was who. Distinctions that were previously clear—the differences between a product and a service, between a car owner and a taxi driver, between a city square and a political movement—blur into each other. The world is becoming more fluid.These changes and the tools driving them have refocused the computer industry. Thanks mostly to the iPhone, Apple—not so long ago a maker of niche desktops and laptops—is now worth more than any other company in the world and just had the most profitable quarter in history. Mr Evans reckons that its revenues are now greater than those of the whole personal computer (PC) business.

Xiaomi, a fast-growing Chinese maker of smartphones, has become the world’s most valuable startup (see ). The smartphone has become information technology’s key product. It generates the most profits; it attracts the most capital and the brightest brains.Apple’s App Store and Google Play, the equivalent for the Android operating system—which runs on 82% of the world’s smartphones, as opposed to Apple’s 15%—now offer users more than 3m apps.

Apple alone sold apps worth more than $14 billion in 2014. Phones which start off identical—much more so, say, than cars—can thus be customised to meet an almost infinite range of needs and enthusiasms. Cry Translator purports to interpret your baby’s mood; RunPee tells you when best to take a toilet break in any film (and fills you in on what you missed).The fact that they can see and hear, that they know where they are and how fast they are being moved and can sense or infer all sorts of other goings-on increases the advantages that smartphones enjoy over boxes which sit on desks. When’s the next bus; what’s that not-quite-recognised tune; how much would that conveniently bar-coded product cost somewhere else; is that really horse on the menu: the combination of local data and cloud computing answers questions in any circumstance a user might find himself.As well as letting people do ever more on their phones, apps let them do ever more things off their phones, too. If something can be connected to the internet—be it a door or a fridge or a thermostat—it can be accessed by an app.

The phone is thus central to the success of the “internet of things”. Wearable technology products—fitness trackers, smart watches, clip-on cameras and the like—will mostly work through the wearer’s phone in a similar way. In part this is because giving wearables short-range wireless links to a phone, rather than their own connection to the internet, means that they can be built with smaller batteries and simpler circuits. In part it is because the phone is already a great way of reading, caching and acting on all sorts of data. The phone can be turned into a remote control for almost anything; you can even add a dog-whistle app to send commands to your pet.

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Please check the numberThe most famous app-based company, Uber, is valued at $41 billion because of the success it has had in turning the smartphone into a remote control for taxis. The smartphone gives the company’s two categories of user—drivers and passengers—the control that they need. And it gives the company’s algorithms the data they need, from car positions to customer feedback.Similar service providers are using smartphones to rejigger local logistics. Over the years many firms have tried to turn the delivery of groceries and other goods into a big business. The latest generation is much more likely to succeed thanks to the smartphones of freelance personal shoppers ready to jump into action should something need to be picked up.

Instacart, one of the biggest such services, has contracts with more than 4,000 of them in 15 American cities. It has grown from $1m in revenues in 2012 to $100m last year.

Such business models are not without critics; the way that “ Plattform-Kapitalismus” integrates people’s lives and livelihoods ever more thoroughly into a network of market transactions is an increasing concern on the European left.The new businesses that smartphones and apps allow are not merely extending the internet; they are also reshaping it in a way that some of its current denizens may find hard to live with. One reason Google got itself into the smartphone world with the acquisition and development of Android was to adapt its business to a world of smartphones dominated by another company. When people access the internet with apps on a phone, rather than with a browser on a PC, they experience it differently. The internet looks a lot less like a set of connected pages, and that makes a business that depends on helping people find the page they want—and seeing ads in the process—look less compelling. Smartphone users mostly buy things through apps, not through searches or ads.If moving to phoneworld has been a challenge for companies born on the web—though Facebook offers an example of doing it successfully—it can be harder still for companies which had only just caught up with the web in the first place. Media companies used to rely on their users going to their websites (though getting them to pay to do so has always been tricky).

But people are now finding stuff they want to read or watch through Facebook, Twitter and, increasingly, messaging services. Snapchat, hugely popular among teenagers because it allows them to send pictures that fade away after a few seconds, recently introduced a service called “Discover”. It offers articles and videos from CNN, National Geographic and others, which disappear after 24 hours. Some publications have already concluded that websites have had their day and are now planning to distribute their wares only directly.Other disruptions are more personal. As Eric Topol argues in his recent book “The Patient Will See You Now” the relationship between a doctor and a patient is another of the things that becomes more fluid in the age of the phone.

Smartphones with the right sensors can collect medically relevant data, from body temperature to blood-glucose levels. They can send pictures of lesions and even double as an otoscope (for ear exams) and other sorts of medical instrument.

Dr Topol, a cardiologist and the director of the Scripps Translational Science Institute, predicts this will give rise to “smart patients” who can talk to the doctor on a more equal footing.Less professional intimacies are also changing. The very local, fluid and action-oriented social networking made possible by apps like Tinder and Grindr is shaking up dating. On Tinder users upload a photo and a short profile and then get shown the pictures of other users nearby. If they like what they see, they swipe a picture to the right—and if not, to the left.

If two users both swipe to the right, they can start chatting on Tinder’s messaging service and take it from there. The not-yet-three-year-old service is used by more than 30m people a day, who make about 1 billion swipes, leading to 13m matches.Social behaviour and etiquette have adapted to new technology in the past; they will do so again. At the unconscious level of habit smartphones are already oddly integrated into people’s lives.

Particular spatial cues—getting into a lift or onto a train, for example—can reliably trigger a check of the screen. A similar effect in toilets is said to be the reason Samsung started making more models waterproof. A strange sensationProtecting users may not always be as easy as protecting their phones. Physiotherapists warn of “text neck”; unlike the Ood, humans evolved to keep all their brains balanced on top of their spines, and constantly hunching forward leads to stress and strain. Some psychologists warn of the danger of slipping past habit to addiction. They are warning not just of gambling apps, but of the more general way in which checking a phone, like gambling, is a search for an elusive reward in which every disappointment reinforces the desire to try again.

David Greenfield, a psychologist and founder of the Centre for Internet and Technology Addiction, calls them “the world’s smallest slot machines”.Teenagers, whose time on phones dwarfs that of their elders (see chart 4), are developing a social life in which face-to-face and digital forms of contact are used interchangeably and often simultaneously. Manuel Castells of the University of Southern California talks of their phone-based lives playing out in a “timeless time” in which activities and exchanges happen in parallel or even backwards (when people’s lives come with timelines, it is a common experience to find out what they said first only after you know what they said next). Find out more aboutThat fluidity fits with other notions of the effects that the smartphone’s truly personal computing could have.

Mechanical clocks allowed the days of the industrial revolution to be regularised in new ways; cars changed the landscape and extended the geography of people’s lives; the printed book made human knowledge more accessible, more easily built on and more thoroughly examinable, fixing it in bindings onto shelves. In its present, admittedly early, days the phone seems to permit earlier regimentation to relax.

It encourages renting over buying, trying out over tying yourself down, co-ordinating things on the fly rather than in advance.Recent political protests have taken advantage of the new fluidity. Smartphones have not caused uprisings or revolutions, but they have affected their dynamics: mobilising has become much cheaper, centralised organisation less necessary. During recent protests in Ferguson, a suburb of St Louis, Missouri, and Hong Kong, messaging apps were used to co-ordinate activities on the ground in real-time.A fixed sense of place has still mattered a lot to these movements—witness Kiev’s Maidan, Cairo’s Tahrir Square, New York’s Zuccotti Park, Hong Kong’s Civic Square. Protest-movement metonymy of this sort reflects the way that physical space is becoming “a function of the virtual world”, in the words of Thomas Sevcik of Arthesia, which provides advice to city governments. The refiguring of public spaces as political platforms reflects the way that the purpose of physical places, be they roads or rooms or buildings, now depends less on where they are and what they were designed for, and more on what is being done with the screens that they contain or that people have brought into them.Such changes will prove fascinating to social scientists, for some of whom the smartphone has become both telescope and microscope, allowing them to see social phenomena both more precisely and on a grander scale than ever before.

Mark Fox

Optimists, such as Alex Pentland of MIT’s Media Lab, argue that the vast amounts of data phones can provide could underpin a new, predictive “social physics”. This new science might be capable of modelling, and thus helping to alleviate, many of the world’s problems, from epidemics to violence (and, indeed, epidemics of violence). Wild time has just begunFor pessimists, however, smartphones are miniature versions of the “telescreens” in George Orwell’s “1984”, omnipresent tools which allow the thought police to identify enemies of the state. The security services in democracies have shown a keen interest in the ability to get into as many smartphones as possible (see ). Those in autocracies are doubtless doing the same. Around the world people are rushing to buy machines through which they can be monitored at previously impossible levels of intimacy—monitored by the state, by companies entrusted with their data, by hackers who steal their information, and by peers who just see what has been posted.Phone-based social media, messaging services and other apps already make people’s lives more public. Hacks into the cloud have been exposing parts of people’s phone-based lives they would rather have kept private.

Drivers For Change In The Personal Computer Industry Overview

Democracies may be able to find acceptable solutions to some of the problems posed. Mr Pentland calls for a “new deal on data”, which would include giving individuals clear rights on their personal data and allow them to better control how the information is used. In “The Black Box Society” Frank Pasquale of the University of Maryland argues for more transparency in the use of data both by governments and companies—and limits on the uses to which they are put. There are technical fixes to some problems. California now insists that smartphones have “kill switches” that allow their owners to lock their devices from afar if they get stolen, thus reducing their value to thieves and protecting the data they could be used to access. The latest versions of both Apple’s iOS and Google’s Android automatically encrypt user data on smartphones in such a way that only the user can decrypt them.Perhaps the most fundamental question about the fluid world of the smartphone is whether its currents will, in general, bring people together or move them apart. The Ood-ignoring, text-neck-risking screen-focused commuters on trains and buses seem even more isolated from each other than they used to be.

Personal Computer Industry Analysis

In 2013 security footage on a San Francisco Muni train showed a number of passengers failing to notice a man playing with a pistol until he shot someone. The title and tagline of a book by Sherry Turkle of MIT seem to sum up something real: “Alone Together—Why We Expect More From Technology and Less From Each Other”.Then again, the devices really do bring people closer together. They do it casually, by ensuring that there is always someone to play a game with, or indeed hook up with. They do it commercially, matching people needing jobs to people wanting them and people with goods to sell to people who want to buy. They do it impersonally, with celebrity selfies sent to huge numbers of followers, and they do it intimately, with near-constant conversation within families and lifelong links to friends you might otherwise have lost. They may do it in a way that lets people exclude voices that challenge them; they may do it in ways that are unutterably banal. They may do it differently according to age and gender—some research suggests that, at least in some cultures, women use phones to enrich and strengthen existing social bonds by sharing photos and the like, while men use them to create new, weaker bonds based on shared interest.

But they do it nonetheless.The new computing’s tendency to the fluid will, in all likelihood, mean that the current form of the phone will not last forever. The truly personal computing phones make possible, though—the sort which adapts you to your surroundings and vice versa—seems sure to persist. People will live in perpetual contact both with each other and with the computational power of the cloud.The Ood, it is worth remembering, did not just have two brains, one in the head and one in the hand—they had a third, planetary brain, telepathically shared by all. It may yet be to such a world that, with phones in hand, pocket and purse, humanity makes its way.