I’ve been thinking a lot about the possibility of a economic singularity lately.
When we think about the acceleration if adaptation of new technologies and the price mechanics of it, there’s a clear trend.
Things get adapted into our everyday lives ever faster. It took at least a couple of decades before “everybody” had televisions. Nearly a decade before everybody had a CD-player. It took five years for the adaptation of DVD players. During the last couple of years everybody has gone on the net (which means that they have a computer).
Think about digital cameras. Nobody, but geeks and pros, had one a couple of years ago. Today, some manufactures has stopped producing old-fashioned point-and-shoot cameras!
And things get ever cheaper. There seems to be a sweet spot around the 50us$ price point for consumer electronics that gets reached ever faster. It took a long time before you could get a cheap TV. Not that long before you could get a cheap CD player. Cheap DVD players have been here for a year now. Computer parts are extremely cheap, when you remember to figure in performance and storage capabilities. A cheap Dell can be had for 500us$ and it probably much faster than anybody normal will need for a long time.
Where is this taking us?
Well, first of all there is a natural lower limit to these things, namely that they take resources to create and deliver. The Postage & Packing fee on you latest on-line shopping adventure is no smaller than a year ago and you didn’t get your things delivered in half the time. Your latest DVD player still contains 500g of metal and 400g of plastic.
It takes energy to prepare all these things – energy is the key. And energy prices are going to rise. But we will get better and better at creating things using less and less energy, especially as energy prices rise. But what if the trend goes unchecked – what if the sweet spot for consumer electronics become 5us$? If your new computer is 50us$? Your new mobile (san subscription subsidies) is 20us$?
Well, my prediction is that this will not happen. We can already see the trend in mobil phones. Feature creep. To justify the price point on these machines more and more functionality has to be added. Camera. PDA functionality. Keyboard? Bigger screen and a hard-drive for watching movies? There’s simply no reason to produce a product so cheap that it’s impossible to keep a profit margin on it.
Mind you, a basic 5us$ mobile phone will still be produced, but it will be sold as a throw-away thing – maybe made of paper and to be recycled after a couple of hours of usage (included in the price).