The Sixth Wave
The pace of technological change is breathtaking. The number of technology developers and vendors seems endless. What does it all mean? What should I be buying? What should I be building? Should I be investing in certain technologies? These are all questions we hear on a regular basis. The following paper provides a lens through which to see where technology is today, where it is going tomorrow and why derived from Wave Theory of Innovation. It is a version of a crystal ball; the basis from which we can help make better decisions about priorities and prerogatives whether you are technology buyer, builder or investor.
Welcome to the Sixth Wave
Innovation is currently at the precipice of the next major arc of innovation - the Sixth Wave. The Fourth Wave, which gave society the modern computer and the Internet and whose period of innovation growth began its decline after the dot com bubble, is waning to a close. Simultaneously, the Fifth Wave, which transformed society driven by mass mobility and the platform economy, has reached its apex. We anticipate new innovation will rapidly decline as its star completely burns out over the next 20 years. Following the present market correction, investment in Fifth Wave technology and businesses will be driven by the consolidation of profits more so than new discoveries and new markets.
The Sixth Wave will be the era of “Autonomous Systems and the Machine Economy,” in which a legion of ubiquitous autonomous things and machines will integrate seamlessly to augment, streamline and improve the quality of human life while enabling a new generation of industrialists to create vast wealth.
This “4th industrial revolution”, as it is often called, will connect over a trillion machines and the software and algorithms that depend on these machines will enable and power an intelligent and autonomous future. Sixth Wave innovation will be regarded as a historic bridge between the physical and the digital world.
The consequence of constructing that bridge promises to propel the American economy to a robust period of high velocity investment for the next several decades, which will help maintain our presence as the center of gravity for global markets while creating the kind of growth that moves the nation forward.
Intelligent, distributed infrastructure is to the Sixth Wave of innovation what industrial automation, robotics, and telecommunications networks were to the Fourth Wave and, likewise, what mobility and multi-tenant software platforms meant for the Fifth Wave.A key characteristic of the Sixth Wave is that data generation and data gravity are translocated to the far-edge of the network. This represents a massive greenfield opportunity for innovators as all matter of digital service providers and enterprise customers push their data processing power to the edge closer to connected users and things.
The desire to deploy digital services at the edge of the network is intuitive and widely understood, as it should reduce latency and increases bandwidths, resulting, theoretically, in greater responsiveness and reliability of deployed services.It is also well understood that true 5G and future wireless access requires densification of ground based infrastructure in order to maximize spectrum use, increase bandwidth, and reduce latencies to connected devices.
Sixth Wave Infrastructure
The consequence of constructing that bridge promises to propel the American economy to a robust period of high velocity investment for the next several decades, which will help maintain our presence as the center of gravity for global markets while creating the kind of growth that moves the nation forward.
Intelligent, distributed infrastructure is to the Sixth Wave of innovation what industrial automation, robotics, and telecommunications networks were to the Fourth Wave and, likewise, what mobility and multi-tenant software platforms meant for the Fifth Wave.
A key characteristic of the Sixth Wave is that data generation and data gravity are translocated to the far-edge of the network. This represents a massive greenfield opportunity for innovators as all matter of digital service providers and enterprise customers push their data processing power to the edge closer to connected users and things.
The desire to deploy digital services at the edge of the network is intuitive and widely understood, as it should reduce latency and increases bandwidths, resulting, theoretically, in greater responsiveness and reliability of deployed services.
It is also well understood that true 5G and future wireless access requires densification of ground based infrastructure in order to maximize spectrum use, increase bandwidth, and reduce latencies to connected devices.
However, less intuitive and understood is the inevitable emergence of edge platforms, which will become de-facto standards for deploying digital services, including AI, at the edge.
Jus as the advent of cloud platforms led to an explosion of higher order consumer, applications which are designed to run on the cloud or cloud native, so too will be the process of transformation at the far-edge of the network. Commodity components will become de-facto standardized, resulting in an edge platform and an explosion of diversity in consumers; applications which are designed to run on the edge or edge native.
A unique quality of the edge is that proximity to users and connected things is a key requirement to the viability of the platform. Said plainly, “location matters” in the development of Sixth Wave Infrastructure. The expanding frontier is arguably as much about real estate and locality as is it is about technology.
Sixth Wave Applications
On a cultural level, the future of digital society faces a multi-dimensional challenge. In one dimension, society faces an existential crisis in the freedom of discourse, government censorship, and the exploitation of private data by bloated tech monopolies. The world’s financial systems, which are built on legacy database architectures, continue to be ravaged by digital pirates and nefarious actors. The financial systems themselves, from banking to finance to commerce, remain locked in an centralized technology and business models.At the same time, software, which society increasingly depends upon in modern life, is evolving from abstract, static, and managed applications to a new realm where software is making real-time decisions empowered by AI, using federated learning models and instantaneous data sharing. The result, some say, will radically alter our experiences with one another and as consumers in the economy. This future of interconnecting trillions of sensors and devices to enable an autonomous and intelligent future will require a departure from current business and technical architecture, including common profit models, centralized data architectures and closed source software systems.
Sixth Wave Sustainability & Resiliency
The specter of sustainability and resiliency looms large over the entirety of Sixth Wave of Innovation. The experience of managing a global pandemic followed by regional conflicts has exposed global supply chains to be the Achilles heel of western economies. The epicenter for the Sixth Wave will form around the nations that control, among other things, the manufacture and export of key technological components. America, the epicenter of the 21st century innovation, now produces only 12% of microprocessor chips. This is an alarming statistic, given that just 30 years ago this number was over 37%.
Sustainability will be a common theme underlying all technologies in the Sixth Wave of innovation. Without radical engineering concepts, the era of Autonomy will put an unprecedented strain on our county’s energy grid and carbon emissions. For example, my research indicates that by 2040 the Information and Communications Technology (ICT) industry could account for 14% of global emissions. This is driven by the fact that data centers (the backbone of the modern Internet economy) could be using 20% of the entire world’s electricity supply by as early as 2025.
As computing and connected machines diffuses out to the furthest reaches of the edge, legacy technologies and practices in the field of sustainable energy production will not suffice. The development and proliferation of Sixth Wave ‘sustainable digital infrastructure’ is critical to our country’s ability to compete on the world stage. Building the foundation of next wave digital infrastructure will make a significant impact on the lives of the next several generations to come.
Data is the Currency of the Sixth Wave
Over a decade a go industry researcher Dave McCrory made an important discovery to explain the economic phenomenon of contemporary platform systems such as Salesforece.com. McCrory’s theory of Data Gravity holds that where data exists, code and services will be attracted. Data, he observed, “has mass.” “As data (mass) accumulates, it begins to have gravity.” Platforms like Salesforce, and the deluge of social media systems that came after it, create information about everything, which is exploited by software systems that create (ideally) value for end users. The aggregation of more code and services, and their underlying monetization, creates economies. Arguably, the biggest platforms of the modern generation, from Google to Facebook to Twitter, have unto themselves created the basis of capitalist opportunity.
Expounding on the theory of Data Gravity, I have established the theory of Sixth Wave Economic Prosperity: Data is the currency, and the relative gravitational pull of data is directly correlated to the wealth and prosperity of the nation and society. Specifically, the more data is created and exists at the far edge of the network, the more applications and services will ‘gravitate’ to this data in order to produce commercially useful systems. Where commercially useful systems exist, Sixth Wave economies will form. The effect will be self-perpetuating cycle because economies create prosperity, which acts as a subsequent gravitation field for talent and investment. The sum of these effects is what results in Next Wave economic prosperity.
Capitalizing on the Sixth WaveUp to the early 2000s venture capitalists played a critical role in underwriting the technological advancements that improved society, but today that is debatable. Some would argue that VCs primary focus has been more on generating high-margin management fees than on creating above-market returns for limited partners in the pursuit of genuine innovation.
This is simply not going to change on its own and the stakes for the future of America’s place in the shifting global economy could not be higher. The venture industry now faces a classic innovator’s dilemma, where there is little interest in self-disrupting a profitable business model at the risk of cannibalizing fundraising efforts and potentially stunting the pursuit of their next fund vintage.
The window of opportunity has emerged for introduce new ways to breath vigor into the relationship between Innovation, Entrepreneurship, and Capital with the goal to accelerate new applications and services that underpin new markets for generations to come.