James Enck - Manchester 22 06 09


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The future ain't what it used to be: perspectives on investing in fibre - James Enck - Analyst, investor, blogger, journalist - Manchester CBN/NextGen Euro Conference - 22 June 2009

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James Enck - Manchester 22 06 09

  1. 1. The future ain’t what it used to be Perspectives on investing in the option value of fibre James Enck mCAPITAL
  2. 2. Your future here
  3. 3. If the past has any lesson for us, it’s that predicting the future is very, very hard
  4. 4. Especially when predicting the sorts of things we won’t need
  5. 5. Not that this fact ever stopped anyone…
  6. 6. What, sir, would you make a ship sail against the wind and currents by lighting a bonfire under her deck? I pray you, excuse me, I have not the time to listen to such nonsense. Napoleon Bonaparte, 1800
  7. 7. Rail travel at high speeds is not possible because passengers, unable to breathe, would die of asphyxia. Dionysius Lardner, Professor of Natural Philosophy and Astronomy at University College, London, and author of “The Steam Engine Explained and Illustrated”, 1830
  8. 8. Well-informed people know it is impossible to transmit the voice over wires and that were it possible to do so, the thing would be of no practical value. Boston Post, 1865
  9. 9. This "telephone" has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us. Western Union Co. internal memo, 1876
  10. 10. The Americans have need of the telephone, but we do not. We have plenty of messenger boys. Sir William Preece, Chief Engineer, British Post Office, 1878
  11. 11. Everything that can be invented has been invented. Charles H. Duell, Commissioner, U.S. Office of Patents, 1899
  12. 12. Who the hell wants to hear actors talk? H.M. Warner, Warner Brothers, 1927
  13. 13. There is no reason for any individual to have a computer in his home. Ken Olsen, founder and CEO, Digital Equipment Corporation, at the World Future Society, 1977
  14. 14. Of course a Ferrari is faster than a Ford, but most people are happy with a Ford. Ian Livingstone, CEO, BT Group, Digital Britain Forum, April, 2009
  15. 15. Expedient choices, dire consequences “I told Mike he'd have to decide between them. It was up to him - The Beatles or Brian Poole and the Tremeloes. He said, 'They're both good, but one's a local group, the other comes from Liverpool.' We decided it was better to take the local group. We could work with them more easily and stay closer in touch as they came from Dagenham.” Dick Rowe, head of A&R, Decca Records “We don’t like their sound. We don’t think they will do anything in their market. Guitar groups are on the way out.” Beatles’ rejection letter from Decca Records
  16. 16. Innovations have an annoying habit of mutating in unpredictable ways
  17. 17. Warfarin nitroglycerine SMS email
  18. 18. Some innovation happens way too soon, only to be abandoned and revived later
  19. 19. Fiber is not just about video! • e-learning • e-medicine • e-government • smart grid • distributed computing • telecommuting • sensor networks • green dividend
  20. 20. Any lessons here?
  21. 21. “When our leaders were contemplating the rollout of electricity in the 19th century, few would have foreseen the profound impact it has had on our economy over the past 150 years. When, in 1894, most of Melbourne's streets were brightened by electricity from Australia's first power station, few could have known the full extent of innovation that would follow. Since then we have seen the advent of refrigeration, automated production lines and electronic media. New industries have flourished and services have improved standards of living across the country. We live in a society where every function and process has been shaped in some way by electricity. It has driven new market efficiencies, productivity and jobs. This technology has fundamentally changed Australia. For this we can thank the vision of previous Governments - Governments that ensured that Australia kept pace with the world and we reaped the rewards. Our past leaders ensured we have had access to enabling technology, offering opportunity beyond their original intentions.” Stephen Conroy Australian Minister for Broadband, Communications and the Digital Economy, April 2009
  22. 22. Decisions, decisions… • How to incentivise stakeholders to invest? • Can this even be achieved in the current market context? • Where will the liquidity come from? • How can we quantify the impacts of innovations which haven’t occurred yet? • Is it enough just to believe?
  23. 23. • We can’t know the answers to some of these questions – the option value of symmetrical fiber is hard to calculate prospectively, but much easier in retrospect. • Conversely, it’s easy to demonstrate a lack of utility for something which is not available. • Many world-changing innovations would not have occurred if sceptics’ views had prevailed. • Connectivity policy is not enough – it must be part of joined-up thinking around economic and social policy.
  24. 24. Awaiting paint, brushes, and, most of all, vision
  25. 25. Thanks!