Technology Development

Atanu Dey writes:

I briefly surveyed all major areas of technological advancement, from transportation to medicine to entertainment to whathaveyou. In every single sphere, the conclusion was unavoidable, that though the advancement was made with an eye to benefit the rich, eventually the poor benefited as well. I could not come up with an instance of any technology that was developed successfully specifically for the poor. It appears to be an empirical law. How do I explain that?

A little pondering and I had what I consider the economic reasoning for that empirical fact. Briefly the story goes this way. Technology advancements have high fixed costs, the recovery of which require high initial prices. The rich are early adopters and pay for the privilege, thus underwriting the development costs. As the marginal costs are typically low, economies of scale kick in and average costs approach the low marginal costs. Note that there is a time element to the whole story. First, it takes a bit of time for the high fixed cost of development to be recovered. Second, as time goes by, there is “learning by doing.” Firms figure out how to do things more efficiently. Average costs come down further. Finally, marketplace competition forces prices to reflect low average costs.

Techmeme Founder Interview

Danny Sullivan has a Q&A with Gabe Rivera, Creator of Techmeme, a site I check daily.

Q. Is Techmeme an echo chamber, just showing blogs commenting about blogs commenting about blogs? Does Techmeme feed into that echo chamber? Or how do you break apart the conversations on a particular topic into sub-conversations or topics?

Clearly Techmeme creates superficial incentives for “echo chamber” participation, yet I don’t see clear evidence that this makes things noticeably worse. I still like to trot out the example of the day my site launched. eBay’s acquisition of Skype became one of those huge story clusters, and this was hours before Techmeme [then tech.memeorandum] was publicly launched, i.e. before anyone believed they could get on the site by linking to stories.

2.7 Billion Mobiles

Tomi Ahonen puts the number in context:

Now we have context. 800 million cars, 850 million personal computers, 1.3 B fixed landline phones, 1.4 billion credit cards, 1.5 billion TV sets. How many mobile phones in use today? In use today, yes, 2.7 billion (technically 2.7 billion in January, not December). They sold 950 million phones last year and the total worldwide mobile subscriber base grew from 2.1 billion to 2.7 billion. Three times as many mobile phones as automobiles or personal computers. About twice as many mobile phone owners as those of fixed landline phones or credit cards. And almost twice as many mobile phones in use as TV sets.

Phones are very aspirational. We project our personalities via the interchangeable covers, various decorations, stickers, and the massive industry of ringing tones. We customize our phone services further with ringback (waiting) tones, welcoming tones and background tones. Young people assign the same kinds of value to their emerging personality, their own perceived coolness etc, through their mobile phone, like older generations did with their first car.