#12: Predicting tech; Lessons from China's Internet companies; Technological shifts; How to sound "deep"
Sept 6 - Oct 4, 2021
Predicting Tech
"That is not only not right; it is not even wrong". â Wolfgang Pauli
Ben Evans made a Bayesian observation that most really important technologies started out as expensive, impractical toys; but most such toys also remained as such. Thus, there is no predictive power in saying âthat doesnât workâ or in saying âpeople always say thatâ.
The key questions to ask (including their inverse):
Is there a clear path for why this will get significantly+rapidly better?
What would have to change?
Will people change their behavior?
Lessons/trends from Chinaâs Internet companies
China has a massive mobile-first (often mobile-only) population. And this market has grown in relative isolation behind the Great Firewall with lots of tech protectionism. As such, new trends are going to develop there, some of which the West will eventually copy.
Rex Woodbury identifies a few:
Friction in community building: Bilibili is a community-centric social app, built around shared interests, that purposefully makes it difficult to join a community (users have to pass a 100-question exam). Building friction into community ensures best-in-class retention: ~85% of Bilibili users retain after 12 months.
Interesting for: Reddit communities, potentially for posting privileges.
Bullet (timeline) commentary: When consuming content on Bilibili, comments from fellow community members flash across your screen, time-stamped to when that user had that reaction. Bullet commentary can create a âlive feelâ to media consumption.
Interesting for: YouTube and mass online live-streams, such as for sports.Social Serendipity (or algorithmic content): Basically what TikTok does really well. Big Tech has been doing this for a while, FBâs NewsFeed in particular, but TikTok was able to skip the entire social-graph hurdle/step altogether.
Participatory Experiences: Yidui users go on a video date chaperoned by a matchmaker, who helps guide the conversation and keep the date on track. At the same time, viewers, can livestream the date, type in the chat and suggest conversation topics, give reactions to how they think the date is going, or send virtual gifts to the people on the date. Yidui shows that on the internet, everythingâeven the most intimate life experiencesâcan be participatory and social.
Collaborative Learning: Chinaâs tutoring companies are huge, despite the recent crackdown, and are at the forefront of p2p learning, as well as cohort-based courses, and in marketplaces to facilitate these.
Interesting for: Coursera, Udemy etc.Social Commerce & Livestreaming: Xiaohongshu offers an Instagram-like experience, but has focused on the shopping/commerce front and center. Pinduoduo encourages you to shop with friends by giving you discounts on group orders.
Food for thought:
India also has a massive mobile-first/only population, though its market grew without the same protectionism from US Big Tech. As such, Google/Facebook/Twitter are all very powerful and big in India, though various Indian companies have managed to establish themselves as well.
Would China-style tech protectionism have helped India, or held it back?
What innovations from Indian tech companies might scale to the West?
On technological shifts
When technology becomes obsolete, it doesn't stop working and in fact generally it retreats to its core customers and their core use cases, and puts up prices. That can be a great business, for a while.
On the other hand, the pandemic has created a reason to accelerate all of this. Legacy systems were fine, until companies discovered that they could not be extended to do new use cases like `buy online pick up in store`. The old systems are good at the old things.
Most of this wonât be very dramatic - these are multi-year infrastructure migration projects, and a decade-long generational shift. But you might also call this âgradually, then suddenlyâ, and itâs a generational shift that in some ways is as fundamental as the consumer internetâs shift from PCs to smartphones.
It also sometimes gets buried in all the discussion of VR and crypto, and of what comes after smartphones, but weâve got another decade or two of âdigital transformationâ, and then itâll be called something else.
The new institutions
The economist Douglass North defined institutions as:
Institutions are the humanly devised constraints that structure political, economic and social interaction. They consist of both informal constraints (sanctions, taboos, customs, traditions, and codes of conduct), and formal rules (constitutions, laws, property rights). Throughout history, institutions have been devised by human beings to create order and reduce uncertainty in exchange. Together with the standard constraints of economics they define the choice set and therefore determine transaction and production costs and hence the profitability and feasibility of engaging in economic activity. They evolve incrementally, connecting the past with the present and the future; history in consequence is largely a story of institutional evolution in which the historical performance of economies can only be understood as a part of a sequential story. Institutions provide the incentive structure of an economy; as that structure evolves, it shapes the direction of economic change towards growth, stagnation, or decline.
Lillian Li observes that the big tech platforms are the new institutions - the humanly-devised constraints shaping human interaction. Over the last half-century in America, traditional institutions have rapidly lost power. Churches, for instanceâonce the connective tissue of many communitiesâsaw membership dip below 50% for the first time in 2020. As the old institutions wither, tech platforms are accruing power and replacing them gradually, with both good and bad consequences.
How to sound deep
Eliezer Yudkowsky says we come across as âdeepâ when we say somethingâŠ
different from known wisdoms, and
a single step of inferential distance away from the listenerâs current mental state, so that they can immediately make sense of it. They donât necessarily have to agree with the thought, but it should not be a non-sequitur to them.