A/Prof Jeffrey Funk
Division of Engineering and Technology Management
National University of Singapore
For more informatio...
Basic Course Objectives
 How and when do new technologies, new forms of
existing technologies, or new combinations of exi...
Change Provides Opportunities
 It provides opportunities for new products and
services
 It also provides opportunities f...
Looking at this Change in More Detail
 Technology
 Magnitude of change is important (e.g., changes in the concepts or
ar...
Example of How Changes Led to Entrepreneurial
Opportunities in Tablet Computers
Opportunity:
Tablet
Computers
including
co...
Many Types of Entrepreneurial Opportunities
Emerged for Tablet Computers
 Designers and Manufactures of
 Tablet computer...
For Change, MT5009 Focuses on Technological
Change
 Technological change makes new things technically and
economically fe...
Number of U.S. Firms Receiving Venture Capital Funding
Source: Dow Jones Venture Capital Industry Report
Industry Group In...
All Industries in 2010 26.45 Billion USD
Aerospace and defense 97
Agriculture and forestry 34
Biopharmaceuticals 3,246
Bus...
All Industries Billions of USD
Materials and chemicals 413
Media and content 343
Medical devices and equipment 2,249
Medic...
 Global Startups (sometimes called Unicorns)
 valuations over $1 Billion
 still private (no IPO yet)
 have raised mone...
Company Latest Valuation Total Equity Funding Last Valuation
Uber $51.0 billion $7.4 billion August 2015
Xiaomi $46.0 bill...
Category U.S. Europe China India Other Total
Software 38 1 2 41
E-Commerce 12 3 9 2 2 28
Consumer
Internet
18 6 7 2 4 37
F...
Returning to “Change,” How and when do New
Technologies Become Economically Feasible?
 What is economic feasibility?
 Wh...
What is Economic Feasibility?
 An objective comparison between a new and existing
technologies. Or products that offer a ...
Quantity (Q)
Price (P)
q
p
What do Demand and Supply Curves Mean and
what do they have to do with Diffusion?
Demand
Supply
Some Relevant Questions:
 What are the first
 Products to diffuse?
 First value propositions?
 First designs?
 Market...
Quantity (Q)
Price (P)
Diffusion typically starts in segments/users that are
willing to pay high prices for new technologi...
What are Rates of Change in Demand and
Supply Curves and What Drives Them?
 Supply Curves
 What is rate of change in sup...
How can this Help us Understand Which
Technologies are Becoming Economically Feasible?
 To understand this questions, we ...
Rate of Improvement
ExtentofImprovementNeeded
Small
Large
Slow Fast
When Will New Technologies Become
Economically Feasibl...
When Will New Technologies Become
Economically Feasible (continued)
 Talking about economic feasibility and the diffusion...
How will we get
information our
in the future?
What Things Will this
Information be From?
And Where will this
Information Be Displayed?
How big
will these
displays be?
And how will
we interact
with
these
displays?
Will We Use
Our Hands
i.e., Gesture
Interface? Or
something
else to access
the info?
Might this Impact on the Future of Offices?
Do we even need Offices?
Or will our offices and our displays be even bigger?
How About Our Homes? What will they be Like?
What is the Future of Cities?
Maybe not the so distant future for cities?
How About Transportation in Cities?
Will these vehicles be
driverless and will they be
stationary or moving at 100 km
per ...
Maybe the Farms will be in the Cities
What About Transport of Vegetables, Fruits, and other Food?
Or Maybe Our Cities will be Someplace Else?
http://edition.cnn.com/2016/01/01/architecture/vincent-callebaut-underwater-sk...
What About the
Future of
Energy?
The
Future
of
Energy?
What About
the Future of
the
Environment?
Or the Future of
Humans?
We Could Look at Many Such Pictures
of the Future…..but
 Obviously there are many technologies that might
shape our futur...
Which Technologies will become a Reality and
which ones will Fade Away?
 This is obviously difficult to predict……
 Depen...
Different Technologies have Different
Annual Rates of Improvement
0
5
10
15
20
25
-10
-8
-6
-4
-2
0
2
4
6
8
10
12
14
16
18...
Faster Rates of Improvements
 Increase the chances that a new technology or systems
composed of that technology will beco...
Key Questions
 Which Technologies are Experiencing Rapid Rates
of Improvement?
 Which Technologies are Experiencing Slow...
What do you think?
 What are the rates of improvements for the
below technologies?
 Batteries?
 Installed wind turbines...
Rates of Improvements
 Batteries – about 5% per year
 Installed Wind Turbines – about 2% per year
 Installed Solar Cell...
Other Slow Rates (<5%)
 Appliances: residential heat pumps, air
conditioners, washing machines, laundry dryers,
dishwashe...
Importance of Fast Annual Rates of
Improvement is Often Underestimated
 1% per year: 70 years for doubling of performance...
Understanding of Rates of
Improvement is Rare
 Many confuse rates of improvement for each doubling
of cumulative producti...
What About Mobile Phones? (1)
 In early 1980s, one study concluded there would be
about 1 million mobile phones in use by...
What About Mobile Phones? (2)
 In early 2000s, many believed that location services
were a huge market
 Until about 2010...
What About Mobile Phones? (3)
 RIM Blackberry worked on email for mobile phones since 1984
 For many years it’s services...
Another Reason Fast Rates of Improvements
are Underestimated
 Cognitive biases
 Nobel Laureate Daniel Kahneman
Cognitive Biases
Nobel Laureate Daniel Kahneman
 People assess relative importance of issues, including new
technologies
...
Types of Questions that Daniel
Kahneman Asks
 Which of the following scenarios is more likely?
 a) Sam goes to work tomo...
Cognitive Biases
 We all have them
 Even MIT probably does (see next slide)
 Some are better at recognizing and avoidin...
MIT Predicted 10 Breakthrough Technologies in
2001, 2003, 2004 and 2005
 After excluding 7 technologies that were too bro...
How Good were these Predictions?
 Difficult to assess, but more than half still have small
markets of less than $1 Billio...
Isn’t there a more deliberate and logical way?
 Understanding rates of improvement can help firms,
universities, and gove...
Technology Dimensions of measure Time
Period
Rate Per
Year
Integrated Circuits Number of transistors per chip 1971-2011 38...
Technology Dimensions of measure Time Period Rate Per
Year
Carbon Nanotube
Transistors
1/Purity (% metallic) 1999-2011 32....
Sub-Technology Dimensions of measure Time Period Rate/
Year
Magnetic Storage Recording density (disks) 1991-2011 55.7%
Rec...
Technology
Domain
Sub-Technology Dimensions of
measure
Time
Period
Rate/
Year
Information
Transmission
Last Mile Wireline ...
Technologies Experiencing Rapid Rates of Improvements
Technology
Domain
Sub-
Technology
Dimensions of
measure
Time Period ...
I probably missed some…..
 Can you find other ones in your group presentations?
 Or can you combine these technologies o...
Let’s talk about the module in
more detail
 Method of grading
 Example of a project on computers
 What about firms?
 O...
Grading
 No research papers or final exam
 Group presentation (60%)
 Participation (10%)
 One page write-ups (30%)
 3...
Group Presentations
 I let you form your own groups/teams in order to
make it easier for you to choose a project
theme/re...
Presentation Should Cover (all are not necessary)
 Important dimensions of performance and cost, i.e., customer
needs, fo...
Grading of Presentations (1)
 Creativity (40%), Thoughtful analysis (40%),
Application of concepts (20%)
 Creativity (40...
Grading of Presentations (2)
 Thoughtful analysis (40%)
 Effectiveness and clarity of presentation
 Slides should be un...
Grading of Presentations (3)
 In general presentations that
 present data
 good explanations of that data
 and provide...
Participation
 You are expected to actively participate in class
discussion
 Please be prepared mentally for the classes...
Grading of One-Page Write-Ups (1)
 Similar to grading of presentations
 Creativity
 Thoughtful analysis
 Application o...
What are Entrepreneurial Opportunities?
 They are not just applications!!
 They are products and services that offer pot...
Although not graded,
you should also think about:
 Implications for yourself
 Does this technology warrant further analy...
Uploading and Labeling of Files
 You must upload many files to IVLE
 Please upload to the correct workbin
 One page wri...
Outline
 Existing theories on technological change do not help
us
 My approach to technological change
 Method of gradi...
Consider Transistors/
Integrated Circuits
 Let’s make believe the year is 1965(*) and you are
Robert Noyce or Jack Kilby
...
Presentation Should Cover (all are not necessary)
 Important dimensions of performance and cost, i.e.,
customer needs, fo...
Important Dimensions of Performance
 Speeds
 Power consumption
 Range of voltages and frequency response
 Size
 Manuf...
Levels of performance and cost that are needed
for the new technology to become economically
feasible
 Small size and fas...
Presentation Should Cover (all are not necessary)
 Important dimensions of performance and cost, i.e., customer
needs, fo...
Time Series Data
 Moore’s Law
 Originally presented in terms of
falling cost
 Later represented by increasing
number of...
Potential for improvements in “system” and
“components” (1)
 Definitions
 System: ICs
 Components: materials and manufa...
Potential for improvements in “system” and
“components” (2)
 Large impact of reduced feature sizes on
 Functionality
 S...
Why a High Potential?
 Miniaturization of ICs is easier than with vacuum
tubes
 ICs are formed in a thin substrate
 Vac...
Presentation Should Cover (all are not necessary)
 Important dimensions of performance and cost, i.e.,
customer needs, fo...
What are Entrepreneurial Opportunities?
 They are not just applications!!
 They are products and services that offer pot...
Types of entrepreneurial opportunities that Kilby
and Noyce might have emphasized (1)
 Various types of discrete transist...
Types of entrepreneurial opportunities that Kilby
and Noyce might have emphasized (2)
 Improvements to existing systems: ...
Types of entrepreneurial opportunities that Kilby
and Noyce would probably not have emphasized,
but have become possible
...
0.01K$
0.1K$
1.K$
10.K$
100.K$
1,000.K$
10,000.K$
100,000.K$
1960 1965 1970 1975 1980 1985 1990 1995 2000
16 KB 64 KB 256 ...
Outline
 Method of grading
 Example of a project on computers
 What about firms?
 Overview of Schedule
What About Firms?
 The unit of analysis in MT5009 is primarily
technology
 Presentations focus on technology
 But you s...
Other Things MT5009 is not About
 I am not expert on how technologies work
 certainly not for all of the technologies co...
Outline
 Existing theories on technological change do not
help us
 My approach to technological change
 Method of gradi...
Session Activities
1 (14 Jan) Objectives and overview of course
2 (21 Jan) How do improvements in cost and performance occ...
Key Deadlines/Events
 Session 3: mail me list of students in your group by 28
January; message must include all members i...
Session 2: How do Improvements in Cost
and Performance Occur?
 Creating materials (and their associated processes) that b...
Session 3: What is the Process by which New
Technologies Become Economically Feasible?
 Supply and demand curves; dynamic...
Sessions 4-10: Technologies experiencing rapid rates
of improvement and new types of higher level systems
 Purpose of ses...
 Looking at the schedule in more detail
Session Technology
4: Feb 4 Future of ICs, Electronic Systems, Internet
5: Feb 11 Sensors, MEMS and the Internet of Things...
Background Information on ICs
 Geometric scaling – how reductions in scale led to
improvements in performance and cost of...
Potential Projects (1)
 New types of processes, transistors, ICs
 Extreme ultra-violet photolithography
 New types of t...
Potential Projects (2)
 New types of electronic products, services, and systems
 New types of mobile phones, computers, ...
Session Technology
4: Feb 4 Future of ICs, Electronic Systems, Internet
5: Feb 11 Sensors, MEMS and the Internet of Things...
Background Information
 Falling cost of sensors, ICs, MEMS, transceivers,
cellular and WiFi services, and energy harveste...
Potential Projects
 Internet of Things, Big Data Wireless sensors
 Putting GPS, transceivers, other sensors in everythin...
Potential Projects (2)
 Monitoring of Structures
 Oil, Gas, Pipelines, Fracking, Mining
 Agriculture, Fishing, Mining
...
Session Technology
4: Feb 4 Future of ICs, Electronic Systems, Internet
5: Feb 11 Sensors, MEMS and the Internet of Things...
Background Information
 Improvements in bio-electronics, including bio-electronic
ICs
 Type of MEMS with micro-fluidic c...
Potential Projects
 New forms of diagnostic equipment, including lab-on-
a chip
 New bio-sensors and attachments for mob...
Potential Projects (2)
 Big Data and Internet of Things for Health Care
 New forms of software for health care including...
Session Technology
4: Feb 4 Future of ICs, Electronic Systems, Internet
5: Feb 11 Sensors, MEMS and the Internet of Things...
Background Information
 Improvements in efficiency (new materials) for past and
new forms of lighting and lasers
 Incand...
Potential Projects (1)
 New forms of lighting
 LEDs or OLEDs
 Smart lighting: combine motion sensors and LEDs/OLEDs
to ...
Potential Projects (2)
 New forms of displays
 Organic Light Emitting Diode (OLEDs) based displays
 Electronic paper su...
Session Technology
4: Feb 4 Future of ICs, Electronic Systems, Internet
5: Feb 11 Sensors, MEMS and the Internet of Things...
Background Information
 New forms of human-computer interfaces (HCI)
 Touch, Voice, Gesture, Neural
 Emphasis on new fo...
Potential Projects (1)
 New forms of touch, gesture, touch, voice, and neural
interfaces
 New forms of augmented reality...
Potential Projects (2)
 New human-computer interfaces for specific applications
(not just for typical users like us)
 Fo...
Session Technology
4: Feb 4 Future of ICs, Electronic Systems, Internet
5: Feb 11 Sensors, MEMS and the Internet of Things...
Background Information
 Role of IT in Transportation
 Better ICs and other components
 Open Source Software
 Improveme...
Potential Projects
 Mobile phones and GPS for buses
 Private bus and ride sharing services through mobile
apps
 Use big...
Session Technology
4: Feb 4 Future of ICs, Electronic Systems, Internet
5: Feb 11 Sensors, MEMS and the Internet of Things...
Background Information
 Nano-technology is general term representing continued
 reductions in feature sizes (<100 nanome...
Potential Projects (1)
 Cost and performance trends for Fullerene, Graphene,
Carbon Nanotubes, Quantum Dots, Nanoparticle...
Potential Projects (2)
 To what extent are superconductors getting cheaper
and better?
 How are these improvements in su...
Summary
 Technologies that experience rapid improvements in
performance and cost or systems composed from them are
more l...
Forming Groups
 Start now!
 I let you form your own groups in order to make it easier
for you to choose a project theme/...
Who am I (1)
 Education
 B.S. in Physics
 Graduate studies in Electrical Engineering
 M.S. Mechanical Engineering (Car...
Who am I (2)
 Research:
 Management of Technology: Product Development,
Standards, Modular Design and Vertical Disintegr...
Who Am I (3)
 Six books, the two most recent
 Technology Change and the Rise of New Industries, Stanford
University Pres...
"Explaining much about innovation that
others have ignored, Funk helps us better
understand how improvements in costs
and ...
Jeff Funk examines what it will take to realize the
potential of new technologies for innovating out of the
economic chall...
"Without resorting to singular case studies, Funk takes
a sophisticated approach to characterizing techno-
logical emergen...
Session 4 Topics for Write-ups
 Identify all the entrepreneurial opportunities
for one of the following technologies
 Bi...
Session 5 Topics for Write-ups
 Identify all the entrepreneurial
opportunities for one of the following
technologies
 Io...
Session 6 Topics for Write-ups
 Identify all the entrepreneurial opportunities for one
of the following technologies
 Sk...
Session 7 Topics for Write-ups
 Identify all the entrepreneurial
opportunities for one of the following
technologies
 Sm...
Session 8 Topics for Write-ups
 Identify all the entrepreneurial opportunities
for one of the following technologies
 Go...
Session 9 Topics for Write-ups
 Identify all the entrepreneurial opportunities
for one of the following technologies
 Ap...
Session 10 Topics for Write-ups
 Identify all the entrepreneurial opportunities
for one of the following technologies
 U...
Intro to course module: How do new Technologies Become Economically Feasible
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Intro to course module: How do new Technologies Become Economically Feasible

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These slides introduce a course that helps students understand when new technologies become economically feasible. It does this by focusing on technologies that are experiencing rapid improvements. These technologies (and systems composed from them) are more likely to become economically feasible for a growing number of applications than are technologies with less rapid rates of improvement. It also helps students understand the reasons for these rapid rates of improvement and thus the types of technologies for which we can expect rapid rates of improvement. While many analyses of new technologies focus on demand and production, these slides show how other technical changes impact more directly on improvements. these technical changes include new materials and scaling.

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Intro to course module: How do new Technologies Become Economically Feasible

  1. 1. A/Prof Jeffrey Funk Division of Engineering and Technology Management National University of Singapore For more information, see: http://www.slideshare.net/Funk98/presentations
  2. 2. Basic Course Objectives  How and when do new technologies, new forms of existing technologies, or new combinations of existing technologies become economically feasible?  For which technologies, are the economics of them becoming better? Why are they getting better?  How can we find these technologies? either as an  entrepreneur or an  employee of a large company  This module helps you  find these technologies  analyze them and present your findings in an end-of year presentation
  3. 3. Change Provides Opportunities  It provides opportunities for new products and services  It also provides opportunities for new firms  New entrants  Incumbents with low shares  Types of changes  Technology  Political and regulatory rules  Social and demographic factors  Industry structure
  4. 4. Looking at this Change in More Detail  Technology  Magnitude of change is important (e.g., changes in the concepts or architectures that form basis of technology)  General changes (Integrated Circuits, magnetic storage, Internet) provide more opportunities than do changes in special technologies  Political and regulatory rules  Licenses  Environmental and safety rules  Social and demographic factors  Changes in customer taste  Increased incomes  Demographic changes such as more women in the workforce or longer life spans  Industry structure  Vertical disintegration  Lower capital intensity
  5. 5. Example of How Changes Led to Entrepreneurial Opportunities in Tablet Computers Opportunity: Tablet Computers including content, software Social: more interest in Internet and accessing information Economic: greater need to stay connected, cheaper entertainment Industry structure: more vertical disintegration in Internet, including more content and apps Technology: falling cost and rising performance of integrated circuits (ICs), displays, and WiFi
  6. 6. Many Types of Entrepreneurial Opportunities Emerged for Tablet Computers  Designers and Manufactures of  Tablet computers  Integrated circuits (ICs) and other electronic components  Displays, touch layer, glass  Suppliers of MEMS and bio-electronics  Software, content, and app suppliers  Contract manufacturers for tablets  Changes in higher level systems such as restaurants, health care, retail, logistics, and insurance  In some situations, this is easy: from 0:05 to 0:15, https://www.youtube.com/watch?v=M0a-_4Mz68c
  7. 7. For Change, MT5009 Focuses on Technological Change  Technological change makes new things technically and economically feasible  Most venture capital is in industries with lots of technological change, rapid improvements in electronic components (e.g., Moore’s Law)  VC firms, Steve Jobs, and other Silicon Valley firms focus on technological change  Steve Jobs said many times that he doesn’t pay attention to customer needs. Likes to tell a joke about Henry Ford and horses.  Other types of change are important, but receive less emphasis in this module  There are patterns of technological change that enable us to identify technologies that are becoming economically feasible
  8. 8. Number of U.S. Firms Receiving Venture Capital Funding Source: Dow Jones Venture Capital Industry Report Industry Group Industry Segment 2000 2005 Healthcare Biopharmaceuticals 338 244 Services 53 43 Medical devices 228 195 Medical Information Systems 210 54 Total 829 537 Information Technology Broadcasting and Cable 17 6 Other Communications & Networking 808 181 Electronics & Computer Hardware 157 106 Information Services 627 116 Semiconductors 254 141 Software 1790 690 Total 3653 1276 Other 1834 426 Grand Total 6316 2239
  9. 9. All Industries in 2010 26.45 Billion USD Aerospace and defense 97 Agriculture and forestry 34 Biopharmaceuticals 3,246 Business support services (mostly Internet) 2,516 Communications and networking 1,027 Construction and civil engineering 141 Consumer information services 4,552 Electronics and computer hardware 1,282 Financial institutions and services 631 Food and beverage 100 Healthcare services (mostly Internet) 1,144 Household and office goods 71 Machinery and industrial goods 188 More Recent Data from Dow Jones
  10. 10. All Industries Billions of USD Materials and chemicals 413 Media and content 343 Medical devices and equipment 2,249 Medical software and information services 478 Non-renewable energy 296 Personal goods 47 Renewable energy 2,118 Retailers 182 Semiconductors 764 Software 3,762 Travel and leisure 133 Utilities 141 Vehicles and parts 460 Wholesale trade and shipping 0
  11. 11.  Global Startups (sometimes called Unicorns)  valuations over $1 Billion  still private (no IPO yet)  have raised money in past four years  at least one venture capital firm as investor  122 firms as of 25 September 2015  With 21 other startups that recently exited (IPOs, acquisitions or decreasing value), total of 143 firms  High valuations mean investors believe these firms offer something valuable, unique, hard to copy  Some of them will  lead to “creative destruction”  have $100 Billion plus market capitalizations in the future, like the strongest hi-tech startups: Apple, Google, Amazon, and Microsoft Wall Street Journal’s Billion Dollar Startup Club
  12. 12. Company Latest Valuation Total Equity Funding Last Valuation Uber $51.0 billion $7.4 billion August 2015 Xiaomi $46.0 billion $1.4 billion December 2014 Airbnb $25.5 billion $2.3 billion June 2015 Palantir $20.0 billion $1.6 billion October 2015 Snapchat $16.0 billion $1.2 billion May 2015 Didi Kuaidi $16.0 billion $4.0 billion September 2015 Flipkart $15.0 billion $3.0 billion April 2015 SpaceX $12.0 billion $1.1 billion January 2015 Pinterest $11.0 billion $1.3 billion February 2015 Dropbox $10.0 billion $607 million January 2014 WeWork $10.0 billion $969 million June 2015 Lufax $9.6 billion $488 million March 2015 Theranos $9.0 billion $400 million June 2014 Spotify $8.5 billion $1.0 billion April 2015 DJI $8.0 billion $105 million May 2015 Zhong An Online $8.0 billion $934 million June 2015 Meituan $7.0 billion $1.1 billion January 2015 Square $6.0 billion $495 million August 2014 Stripe $5.0 billion $290 million July 2015 ANI Technologies (Ola Cabs) $5.0 billion $903 million September 2015 Snapdeal $5.0 billion $911 million August 2015 Stemcentrx $5.0 billion $250 million September 2015 Zenefits $4.5 billion $596 million May 2015 Cloudera $4.1 billion $670 million March 2014 Dianping $4.0 billion $1.4 billion March 2015 The Top 25 Firms as of 25 September, 2015
  13. 13. Category U.S. Europe China India Other Total Software 38 1 2 41 E-Commerce 12 3 9 2 2 28 Consumer Internet 18 6 7 2 4 37 Financial 7 4 3 1 15 Hardware 7 2 1 10 Healthcare 7 1 8 Energy 2 2 Space 1 1 Retail 1 1 Total 92 14 22 6 9 143 Number of Startups, by Category and Country Most are Internet Related (122) Note: some of the startups were redefined and the smaller categories were combined, based on the descriptions by the Wall Street Journal and other sources
  14. 14. Returning to “Change,” How and when do New Technologies Become Economically Feasible?  What is economic feasibility?  What causes new technologies to become economically feasible?  Changes in demand?  Changes in supply?  How do these changes impact on on diffusion of new technology?  Can we use this information to understand which technologies become economically feasible?  And make better decisions
  15. 15. What is Economic Feasibility?  An objective comparison between a new and existing technologies. Or products that offer a superior value proposition to some set of customers  superior performance in one or more dimensions  superior features, lower price  We distinguish economic feasibility from organizational or regulatory changes that also impact on diffusion of new technologies  Over time new technology will become  Used by some first users  And later becomes economically feasible for growing number of users and thus diffuse  We can represent this with supply and demand curves
  16. 16. Quantity (Q) Price (P) q p What do Demand and Supply Curves Mean and what do they have to do with Diffusion? Demand Supply
  17. 17. Some Relevant Questions:  What are the first  Products to diffuse?  First value propositions?  First designs?  Markets to accept this diffusion?  First customer segments?  First customers within segments?  First sales channels?  In this module, we are more interested in how the new technology actually becomes economically feasible. Thus….  What are typical movements of supply and demand curves  When do they intersect?  What impacts on this timing?
  18. 18. Quantity (Q) Price (P) Diffusion typically starts in segments/users that are willing to pay high prices for new technologies Demand Curve Supply Curve Typical movement of supply curve over time Typical movement of demand curve over time
  19. 19. What are Rates of Change in Demand and Supply Curves and What Drives Them?  Supply Curves  What is rate of change in supply curve?  Predominant viewpoint: demand drives improvements  But this ignores reality of R&D (Sessions 2 and 3)  universities and other labs improve technologies long before technologies are commercially produced  Improvements in “components” make new “system” economically feasible  What are rates of improvement and thus rates of change in supply curves?  Demand Curves  Increases in income  Changes in complementary technologies or consumer preference
  20. 20. How can this Help us Understand Which Technologies are Becoming Economically Feasible?  To understand this questions, we must understand rates of improvement and the extent of improvements needed  Which technologies have rapid rates of improvement and what drives these improvements?  What drives the emergence of and improvements in technologies, e.g., improvements in cost and performance? (Sessions 2 and 3)  What extent of improvements are needed?  Which technologies require improvement?  Which require large improvements before they become economically feasible
  21. 21. Rate of Improvement ExtentofImprovementNeeded Small Large Slow Fast When Will New Technologies Become Economically Feasible? Now or Probably Very Soon Probably Never Within 5 to 15 Years? Within 5-15 Years?
  22. 22. When Will New Technologies Become Economically Feasible (continued)  Talking about economic feasibility and the diffusion of new technologies is really talking about the future…………  What do you think the future will be like?  On what basis have you developed these views?  Is there a better way to think about the future?  One that prevents us from becoming a victim to cognitive biases (more on this later)  Let’s think about the future first, and how our world might change  Changes that assume the Internet and phones will become more important
  23. 23. How will we get information our in the future?
  24. 24. What Things Will this Information be From? And Where will this Information Be Displayed?
  25. 25. How big will these displays be? And how will we interact with these displays?
  26. 26. Will We Use Our Hands i.e., Gesture Interface? Or something else to access the info?
  27. 27. Might this Impact on the Future of Offices? Do we even need Offices?
  28. 28. Or will our offices and our displays be even bigger?
  29. 29. How About Our Homes? What will they be Like?
  30. 30. What is the Future of Cities?
  31. 31. Maybe not the so distant future for cities?
  32. 32. How About Transportation in Cities? Will these vehicles be driverless and will they be stationary or moving at 100 km per hour? Will private cars exist?
  33. 33. Maybe the Farms will be in the Cities What About Transport of Vegetables, Fruits, and other Food?
  34. 34. Or Maybe Our Cities will be Someplace Else? http://edition.cnn.com/2016/01/01/architecture/vincent-callebaut-underwater-skyscraper/index.html
  35. 35. What About the Future of Energy? The Future of Energy?
  36. 36. What About the Future of the Environment?
  37. 37. Or the Future of Humans?
  38. 38. We Could Look at Many Such Pictures of the Future…..but  Obviously there are many technologies that might shape our future  And their numbers are rapidly increasing……..  Which ones will become a reality and which ones will fade away?  Will these technologies lead to better lives for us, our families, our grandchildren?  Will you personally benefit from them?  As users?  As suppliers?  As entrepreneurs?
  39. 39. Which Technologies will become a Reality and which ones will Fade Away?  This is obviously difficult to predict……  Depends on  rates of improvements  extent of improvements needed  where the above two depend on user preferences and  interactions between multiple technologies or what I call an interaction between systems and components  Improvements in components enable us to design new and better systems  All of the previous pictures were of systems  We focus on rates of improvement and degree of improvements needed
  40. 40. Different Technologies have Different Annual Rates of Improvement 0 5 10 15 20 25 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 >42 Number of Technologies by Annual Rates of Improvement Annual Rates of Improvement Source: my analysis of data from: Nagy B, Farmer D, Bui Q, Trancik J 2013. Statistical Basis for Predicting Technological Progress. PLoS ONE 8(2): e52669. doi:10.1371/journal.pone.0052669NREL, 2013 67%: <9% per year 89%: <15% per year
  41. 41. Faster Rates of Improvements  Increase the chances that a new technology or systems composed of that technology will become economically feasible  For example, Moore’s Law enabled emergence of many new products, services, and systems  Calculators, digital watches  Personal computers, laptops, tablets, PDAs  Video games, digital cameras, MP3 Players  E-book readers, digital TV, smart phones  What new systems will Moore’s Law or other technologies enable in the future?  This question was implicit in many of the pictures shown earlier
  42. 42. Key Questions  Which Technologies are Experiencing Rapid Rates of Improvement?  Which Technologies are Experiencing Slow Rates of Improvement  What do you think?
  43. 43. What do you think?  What are the rates of improvements for the below technologies?  Batteries?  Installed wind turbines?  Installed solar Cells?  ICs, lasers, other electronic components, computers?  Superconductivity?  We then might ask which of the above technologies will have the largest impact on reducing the usage of fossil fuels in the next 10 years
  44. 44. Rates of Improvements  Batteries – about 5% per year  Installed Wind Turbines – about 2% per year  Installed Solar Cells – about 7% per year (much faster for the cells themselves)  ICs, computers, lasers, electronic components – between 30 and 40% per year  Superconductors – between 30 and 50% a year  Slow rates of improvements suggest that “improvements in batteries and wind turbines” will have smaller effect than will other technologies  Can improvements in ICs etc. enable improvements in efficiency of logistics, transportation and other energy intensive activities?
  45. 45. Other Slow Rates (<5%)  Appliances: residential heat pumps, air conditioners, washing machines, laundry dryers, dishwashers, refrigerators, freezers, light bulbs (Weiss, M., M. Junginger, M. K. Patel and K. Blok 2010. A review of experience curve analyses for energy demand technologies, Technological Forecasting and Social Change 77(3): 411-428)  Materials, beverages, electrical appliances, foods  some chemicals experienced slightly faster rates of improvement, but rarely reach 10% a year  Nagy B, Farmer D, Bui Q, Trancik J 2013. Statistical Basis for Predicting Technological Progress. PLoS ONE 8(2): e52669. doi:10.1371/journal.pone.0052669NREL, 2013  What is the difference between annual rates of improvement and rates of improvement with each doubling of cumulative production?
  46. 46. Importance of Fast Annual Rates of Improvement is Often Underestimated  1% per year: 70 years for doubling of performance (or halving of costs)  5% per year: 14 years for doubling  10% per year: 7 years for doubling  20% per year: 3.5 years for doubling  30% per year: 2.3 years for doubling  Technologies with rapid rates of improvement can have a large impact on our world and how we design cities, homes, offices, health care and energy generation and distribution
  47. 47. Understanding of Rates of Improvement is Rare  Many confuse rates of improvement for each doubling of cumulative production with annual rates of improvement  Many don’t know the rates of improvement  Many assume technologies are experiencing rapid rates of improvement because they are widely discussed (batteries, wind turbines)  Even if they know them, they don’t understand the implications
  48. 48. What About Mobile Phones? (1)  In early 1980s, one study concluded there would be about 1 million mobile phones in use by 2000  Some would say we under estimated the need for mobile phones  I say we under estimated the impact of Moore’s Law on the cost of mobile phones
  49. 49. What About Mobile Phones? (2)  In early 2000s, many believed that location services were a huge market  Until about 2010 no one used these services  Until about 2010 some would say we overestimated the need for such services  I say we  over estimated the impact of Moore’s Law on the cost of such services for short term  under estimated the impact for long term
  50. 50. What About Mobile Phones? (3)  RIM Blackberry worked on email for mobile phones since 1984  For many years it’s services could only be accessed on special pagers with special data services (Mobitex)  Its mail services became available on general phones in 2002  They became widely popular with business and later consumers (by 2007). firm had market capitalization of $83 Billion in June 2008  RIM Blackberry is shocked by success of iPhone in 2008  Takes years to release a competitive product  RIM Blackberry didn’t understand that Moore’s Law would continue to make new types of products economically feasible Source: Losing the Signal: The Spectacular Rise and Fall of Blackberry, 2015. Jacquie McNish, Sean Silcoff
  51. 51. Another Reason Fast Rates of Improvements are Underestimated  Cognitive biases  Nobel Laureate Daniel Kahneman
  52. 52. Cognitive Biases Nobel Laureate Daniel Kahneman  People assess relative importance of issues, including new technologies  by ease of retrieving from memory  largely determined by extent of coverage in media  E.g., media talks about solar, wind, battery-powered vehicles, bio-fuels and thus many think they have rapid rates of improvement - but only some are  Second, judgments and decisions are guided directly by feelings of liking and disliking  One person invested in Ford because he “liked” their products – but was Ford stock undervalued?  Many people “like” some technologies and dislike others without considering rates of improvement Source: Daniel Kahneman, Thinking Fast and Slow, 2011
  53. 53. Types of Questions that Daniel Kahneman Asks  Which of the following scenarios is more likely?  a) Sam goes to work tomorrow  b) Sam goes to zoo tomorrow  c) Sam goes to restaurant tomorrow night  d) Sam goes to work at a high tech IT office during day developing software and goes to restaurant in Chijmes at night with his friends  An American man has been described by neighbors as follows:  “Ryan is very shy and withdrawn, invariably helpful but with little interest in people or in the world of reality. A meek and tidy soul, he has a need for order and structure and a passion for detail.”  Is Ryan more likely to be a librarian or a farmer?
  54. 54. Cognitive Biases  We all have them  Even MIT probably does (see next slide)  Some are better at recognizing and avoiding them than are others  Warren Buffet is probably better than most of us  Most management programs spend more time on cognitive biases and decision making than does ETM  Before returning to technology change and understanding when new technologies become economically feasible, let’s take a brief look at MIT’s predictions of the future
  55. 55. MIT Predicted 10 Breakthrough Technologies in 2001, 2003, 2004 and 2005  After excluding 7 technologies that were too broad to gather data, there were 33 technologies  1 has greater than $10 Billion in sales  smart grids (power grid control)  2 have sales between $5 and $10 Billion  micro-photonics, personal genomics  11 have sales between $1 and $10 Billion  Grid computing, Molecular imaging, Synthetic Biology, Distributed Storage  RNAi Interference, Brain-Machine Interface, Data mining, Biometrics  Digital Rights Management, Natural Language Processing, Microfluidics  5 have sales between $100 million and $1 Billion  14 have sales less than $100 million
  56. 56. How Good were these Predictions?  Difficult to assess, but more than half still have small markets of less than $1 Billion in sales  Might these markets grow in the near future?  Or have they been abandoned?  MIT’s Technology Review also missed many technologies that have more than $10 Billion in sales  Smart phones Cloud computing  Tablet computers Big Data  Social Networking eBooks and eReaders  A big reason for their poor predictions was that they focused too much on science and not enough on rapidly improving technologies
  57. 57. Isn’t there a more deliberate and logical way?  Understanding rates of improvement can help firms, universities, and governments better understand when new technologies might become economically feasible  Technologies must have some level of performance and price for specific applications before they begin to diffuse  Technologies that experience faster rates of improvement are more likely to become economically feasible….  They are also more likely to have an impact on how we design higher-level systems  This has implications for R&D policy and solving global problems such as urban congestion, sustainability  But which technologies are currently experiencing rapid rates of improvement and why?
  58. 58. Technology Dimensions of measure Time Period Rate Per Year Integrated Circuits Number of transistors per chip 1971-2011 38% Power ICs Current Density 1993-2012 16.1% Passive RFID Price per RFID transponder 2005-2012 19.1% Camera chips Pixels per dollar 1983-2013 48.7% Light sensitivity 1986-2008 18% MEMS Number of Electrodes per Eye 2002-2013 45.6% Drops per second for printer 1985-2009 61% Organic Transistors Mobility 1994-2007 101% Computers Instructions per unit time 1979-2009 35.9% Instructions per time and dollar 1979-2009 52.2% Technologies Experiencing Rapid Rates of Improvements (Information Processing)
  59. 59. Technology Dimensions of measure Time Period Rate Per Year Carbon Nanotube Transistors 1/Purity (% metallic) 1999-2011 32.1% Density (per micrometer) 2006-2011 357% Superconducting Josephson Junctions 1/Clock period 1990-2010 20.3% 1/Bit energy 1990-2010 19.8% Qubit Lifetimes 1999-2012 142% Bits per Qubit lifetime 2005-2013 137% Photonics Number of Optical Channels 1983-2011 39.0% Computers Instructions per unit time 1979-2009 35.9% Instructions per time and dollar 1979-2009 52.2% Quantum Computers Number of Qubits 2002-2012 107% Technologies Experiencing Rapid Rates of Improvements (Information Processing - Continued)
  60. 60. Sub-Technology Dimensions of measure Time Period Rate/ Year Magnetic Storage Recording density (disks) 1991-2011 55.7% Recording density (tape) 1993-2011 32.1% Cost per bit 1956-2007 32.7% Flash Memory Storage Capacity 2001-2013 47% Resistive RAM 2006-2013 272% Ferro-electric RAM 2001-2009 37% Phase Change RAM 2004-2012 63% Magneto RAM 2002-2011 58% Technologies Experiencing Rapid Rates of Improvements (Information Storage)
  61. 61. Technology Domain Sub-Technology Dimensions of measure Time Period Rate/ Year Information Transmission Last Mile Wireline Bits per second 1982-2010 48.7% Wireless, 100 m Bits per second 1996-2013 79.1% Wireless, 10 m 1995-2010 58.4% Wireless, 1 meter (USB) 1996-2008 77.8% Materials Transformation Carbon Nanotubes 1/Minimum Theoretical Energy for Production 1999-2008 86.3% Biological Trans- formation DNA Sequencing per unit cost 2001-2013 146% Synthesizing per cost 2002-2010 84.3% Cellulosic Ethanol Output per cost 2001-2012 13.9% Technologies Experiencing Rapid Rates of Improvements (Information Transmission, Materials and Biological Transformation)
  62. 62. Technologies Experiencing Rapid Rates of Improvements Technology Domain Sub- Technology Dimensions of measure Time Period Rate Per Year Energy Trans- formation Light Emitting Diodes (LEDs) Luminosity per Watt 1965-2008 31% Lumens per Dollar 2000-2010 41% Organic LEDs Luminosity per Watt 1987-2005 29% GaAs Lasers Power/length-bar 1987-2007 30% LCDs Square meters/dollar 2001-2011 11% Quantum Dot Displays External Efficiency 1994-2009 79% Solar Cells Peak Watt Per Dollar 2004-2013 21% Photo-sensors (Camera chips) Pixels per dollar 1983-2013 49% Light sensitivity 1986-2008 18% Energy Transmission Super- conductors Current-length/dollar 2004-2010 115% Current x length-BSSCO 1987-2008 33% Current x length-YBCO 2002-2011 53%
  63. 63. I probably missed some…..  Can you find other ones in your group presentations?  Or can you combine these technologies or these and other technologies into new “systems”  Don’t just copy what others say, combine technologies into new and novel systems  This is your opportunity to think about the future and do so in a more rigorous way than is done by the media  Technologies with rapid rates of improvement will have a large impact on the world partly depending on how they are combined in novel and interesting ways  By the way  If there are <40 students, 3-4 students per group  If >40 students, 4-5 students per group  If >50 students, 5-6 students per group
  64. 64. Let’s talk about the module in more detail  Method of grading  Example of a project on computers  What about firms?  Overview of Schedule
  65. 65. Grading  No research papers or final exam  Group presentation (60%)  Participation (10%)  One page write-ups (30%)  3 one-page write-ups on topics related to technologies covered in sessions 4 through 10  Identify the entrepreneurial opportunities for one of the technologies listed for that session
  66. 66. Group Presentations  I let you form your own groups/teams in order to make it easier for you to choose a project theme/research topic that is closer to your interests  Assessments by peers will be used to translate group presentation grades into individual grades  Feedback given on summaries before Session 6 and on presentation slides in or before Session 11  Number of students per group  If there are <40 students, 3-4 students per group  If >40 students, 4-5 students per group  If >50 students, 5-6 students per group
  67. 67. Presentation Should Cover (all are not necessary)  Important dimensions of performance and cost, i.e., customer needs, for new technology  Levels of performance and cost that are needed for new technology to become economically feasible  Time series data on improvements in cost and performance of “system” and “components”  You must explain how and why the economics are changing  How these improvements are occurring, i.e., mechanisms  Potential for further improvements  Entrepreneurial Opportunities for technology.  a good list of startups (>500,000) can be found for specific technologies here: https://angel.co/markets  Summarize startups pursuing the specific technology, and the technologies that are becoming economically feasible but are not yet pursued
  68. 68. Grading of Presentations (1)  Creativity (40%), Thoughtful analysis (40%), Application of concepts (20%)  Creativity (40%)  grade reflects both choice and analysis of technology  technology should be new (not widely used or not used at all)  may combine individual technologies (i.e., components) in novel and useful ways  Should involve technologies that are experiencing rapid improvements  You can choose a topic that I cover in class and/or one that has been covered in previous years, but you must provide more details and insights than those presentations. See my slideshare account for past presentations  http://www.slideshare.net/Funk98/presentations
  69. 69. Grading of Presentations (2)  Thoughtful analysis (40%)  Effectiveness and clarity of presentation  Slides should be understandable without explanations  Acronyms should be defined  Data should be effectively interpreted on separate slides  Inconsistencies between data should be discussed  Non-essential information should be excluded from slides  Please include references  Application of concepts (20%) covered in this module  How improvements occur  Materials, scaling, processes, components and systems  Changing economics – how are economics changing?
  70. 70. Grading of Presentations (3)  In general presentations that  present data  good explanations of that data  and provide details will receive better grades than will other presentations  Wikipedia, Answers.com, or HowStuffWorks.com should only be starting points for analysis  Presentation grades are translated into individual grades using peer evaluations • See previous years’ presentations for more details: http://www.slideshare.net/Funk98/presentations
  71. 71. Participation  You are expected to actively participate in class discussion  Please be prepared mentally for the classes  Many questions will be asked to stimulate discussion  Some of these questions will be about your vision for Singapore’s future  Please be prepared for these types of questions  There is no right answers for these questions
  72. 72. Grading of One-Page Write-Ups (1)  Similar to grading of presentations  Creativity  Thoughtful analysis  Application of concepts  Key difference. Grades reflect:  the extent to which the write-up identifies entrepreneurial opportunities for specific technologies that are covered in Sessions 4-10  specific technologies are listed at end of session
  73. 73. What are Entrepreneurial Opportunities?  They are not just applications!!  They are products and services that offer potential revenues to their providers  Related, but not the same as applications!  Not just final product or service, but any component, software, service, or manufacturing equipment that is needed to commercialize the technology  Think about vertical disintegration  Applications should be analyzed in terms of the products and services that are needed to satisfy the applications  Different applications may require different types of products and services  The more specific you can be, the better your grade
  74. 74. Although not graded, you should also think about:  Implications for yourself  Does this technology warrant further analysis by myself?  Do I have some skills that can be transferred to this new technology?  For example, if you are a semiconductor engineer, is the potential for solar energy or new displays large enough for you to consider learning about them? Or for you to consider changing jobs?
  75. 75. Uploading and Labeling of Files  You must upload many files to IVLE  Please upload to the correct workbin  One page write-ups on lectures  Peer evaluations (or mail to me)
  76. 76. Outline  Existing theories on technological change do not help us  My approach to technological change  Method of grading  Example of a project on ICs  What about firms?  Overview of Schedule
  77. 77. Consider Transistors/ Integrated Circuits  Let’s make believe the year is 1965(*) and you are Robert Noyce or Jack Kilby  Who were co-developers of the IC in 1959 *Gordon Moore’s famous article was published in 1965
  78. 78. Presentation Should Cover (all are not necessary)  Important dimensions of performance and cost, i.e., customer needs, for new technology  Levels of performance and cost that are needed for new technology to become economically feasible  Time series data on improvements in cost and performance of “system” and “components”  You must explain how and why the economics are changing  How these improvements are occurring, i.e., mechanisms  Potential for further improvements  Entrepreneurial Opportunities for technology
  79. 79. Important Dimensions of Performance  Speeds  Power consumption  Range of voltages and frequency response  Size  Manufacturing cost  Development cost
  80. 80. Levels of performance and cost that are needed for the new technology to become economically feasible  Small size and faster speeds were major advantages of ICs  But initially too expensive for most applications  Market initially limited to military applications like missiles  Next markets were computer and telecommunication systems  First transistors used in computers in late 1950s  Consumer applications for ICs required much lower levels of cost  In addition to cost problems, too high of power consumption for portable calculators and watches
  81. 81. Presentation Should Cover (all are not necessary)  Important dimensions of performance and cost, i.e., customer needs, for new technology  Levels of performance and cost that are needed for new technology to become economically feasible  Time series data on improvements in cost and performance of “system” and “components”  You must explain how and why the economics are changing  How these improvements are occurring, i.e., mechanisms  Potential for further improvements  Entrepreneurial Opportunities for technology.  a good list of startups (>500,000) can be found for specific technologies here: https://angel.co/markets  Summarize startups pursuing the specific technology, and the technologies that are becoming economically feasible but are not yet pursued
  82. 82. Time Series Data  Moore’s Law  Originally presented in terms of falling cost  Later represented by increasing number of transistors per chip  One could also have identified the resulting improvements in various “systems”  in processing speeds or costs of computers  in cost and performance of other electronic products
  83. 83. Potential for improvements in “system” and “components” (1)  Definitions  System: ICs  Components: materials and manufacturing equipment  Ability to improve yields and decrease feature sizes (i.e., scaling) partly because equipment and processes were available (e.g., from nuclear, aerospace, and other industries) for doing so  Epitaxial and other deposition equipment  Diffusion (i.e., furnace) and ion implementation equipment  Screen printing equipment  Wet chemical baths
  84. 84. Potential for improvements in “system” and “components” (2)  Large impact of reduced feature sizes on  Functionality  Speeds  Power consumption (lower per transistor)  Size  Manufacturing costs  What were (in 1965 terms) the perceived limits to reducing the feature sizes?  If there are no limits and rapid improvements can be made………………
  85. 85. Why a High Potential?  Miniaturization of ICs is easier than with vacuum tubes  ICs are formed in a thin substrate  Vacuum tubes are based on electrodes and current jumping across electrode
  86. 86. Presentation Should Cover (all are not necessary)  Important dimensions of performance and cost, i.e., customer needs, for new technology  Levels of performance and cost that are needed for new technology to become economically feasible  Time series data on improvements in cost and performance of “system” and “components”  You must explain how and why the economics are changing  How these improvements are occurring, i.e., mechanisms  Potential for further improvements  Entrepreneurial Opportunities for technology
  87. 87. What are Entrepreneurial Opportunities?  They are not just applications!!  They are products and services that offer potential revenues to their providers  Related, but not the same as applications!  Not just final product or service, but any component, software, service, or manufacturing equipment that is needed to commercialize the technology  Think about vertical disintegration  Applications should be analyzed in terms of the products and services that are needed to satisfy the applications  Different applications may require different types of products and services  The more specific you can be, the better your grade
  88. 88. Types of entrepreneurial opportunities that Kilby and Noyce might have emphasized (1)  Various types of discrete transistors and ICs  Various types of supporting technologies  Semiconductor manufacturing equipment  Materials for wafers and various layers  Computer-aided design tools, software for equipment  Later design houses, foundries  Improvements to existing systems: Replace vacuum tubes with ICs in low power applications  Military equipment such as missiles  Computers, radios and televisions  Telephones and telecommunication switches
  89. 89. Types of entrepreneurial opportunities that Kilby and Noyce might have emphasized (2)  Improvements to existing systems: Replace mechanical controls/systems with ICs  Watches  Mechanical calculators  Numerical controlled machine tools  Process controls for chemical plants
  90. 90. Types of entrepreneurial opportunities that Kilby and Noyce would probably not have emphasized, but have become possible  Make new forms of systems possible  Personal computers including portable ones  Mobile phones  Set-top boxes for cable television  Routers, switches, and the Internet  This would have led to opportunities for providers of these systems and ICs along with software, and other components for these systems  I would not have expected them to identify these kinds of market opportunities (and thus I don’t expect you to be able to do so)
  91. 91. 0.01K$ 0.1K$ 1.K$ 10.K$ 100.K$ 1,000.K$ 10,000.K$ 100,000.K$ 1960 1965 1970 1975 1980 1985 1990 1995 2000 16 KB 64 KB 256 KB 1 MB 8 MB System Price K$ = 5 x 3 x .04 x memory size/ 1.26 (t-1972) 5: Memory is 20% of cost 3: DEC markup .04: $ per byte He didn’t believe: The projection 500$ machine He couldn’t comprehend implications Gordon Bell’s (CTO of DEC)1975 VAX (mini-computer) planning model... : He didn’t believe it! Source: Jim Gray, Microsoft: slidefinder.net/l/laws_cyberspace/62483
  92. 92. Outline  Method of grading  Example of a project on computers  What about firms?  Overview of Schedule
  93. 93. What About Firms?  The unit of analysis in MT5009 is primarily technology  Presentations focus on technology  But you should identify startups and/or incumbents that are commercializing the technology  a good list of startups (>500,000) can be found for specific technologies here: https://angel.co/markets  Summarize startups pursuing the specific technology and the technologies that are becoming economically feasible but are not yet pursued
  94. 94. Other Things MT5009 is not About  I am not expert on how technologies work  certainly not for all of the technologies covered in MT5009  The module focuses on improvement trajectories and what these trajectories means for  when those technologies will become economically feasible  And the entrepreneurial opportunities that will likely emerge  Please refer to the experts on these technologies for details on how they work  But also remember that explanations for phenomena often change over time
  95. 95. Outline  Existing theories on technological change do not help us  My approach to technological change  Method of grading  Example of a project on computers  What about firms?  Overview of Schedule
  96. 96. Session Activities 1 (14 Jan) Objectives and overview of course 2 (21 Jan) How do improvements in cost and performance occur? 3 (28 Jan) What is the long term process by which new technologies become economically feasible? 4-10 (4 Feb to 24 March) Technologies experiencing rapid rates of improvement and new types of products, services, systems 11 (31 March) Review of student slides 12 (7 April), 13 (14 April) Group presentations Schedule
  97. 97. Key Deadlines/Events  Session 3: mail me list of students in your group by 28 January; message must include all members in carbon copy  Session 5: mail me one-page summaries of proposed presentations by 11 February (I respond before Session 6)  Session 10: upload your slides to workbin on IVLE by 24 March  Sessions 4-10: Write-ups due one week after relevant session  Session 11: I provide feedback on slides in class and during previous days  Sessions 12 and 13: group presentations  Two weeks after sessions 12 and 13: write-ups on presentations are due
  98. 98. Session 2: How do Improvements in Cost and Performance Occur?  Creating materials (and their associated processes) that better exploit physical phenomena  Geometrical scaling  Increases in scale: e.g., larger production equipment, engines, oil tankers  Reductions in scale: e.g., integrated circuits (ICs), magnetic storage, MEMS, bio-electronic ICs  Some technologies directly experience improvements while others indirectly experience them through improvements in “components”. Examples of systems include:  Computers and other electronic systems  Telecommunication systems  Rapid improvements are primarily driven by reductions in scale and by new materials, when new classes are created
  99. 99. Session 3: What is the Process by which New Technologies Become Economically Feasible?  Supply and demand curves; dynamics of economic feasibility  Two models of technology change  1) Model of Invention, Commercialization, Diffusion in which advances in Science play important role  2) Improvements in components lead to emergence of new systems  Billion Dollar Startup Club – private recent startups with $1Billion dollar values. Component & Sys model best explains emergence of opportunities that they exploited  Empirical Analysis of Predictions Made by MIT  Myths (and realities) about technology change  #1: Performance vs. time curves resemble S-curve  #2: Slowdowns in old technology drive improvements in new technology  #3: A-U (Abernathy-Utterback) model  #4: Costs fall as cumulative production rises in learning curve
  100. 100. Sessions 4-10: Technologies experiencing rapid rates of improvement and new types of higher level systems  Purpose of sessions is to help you  understand the technology and the changes occurring in this technology  identify and do analysis in group projects  You can analyze any technologies covered in these sessions including ones done by students in previous years  You must, however, focus on a slightly different technology, perhaps a sub-technology, or go beyond my discussions or those in previous years  If you choose a technology that will be discussed in this module, you should look at the slides in advance, which are available on the IVLE or http://www.slideshare.net/Funk98/presentations
  101. 101.  Looking at the schedule in more detail
  102. 102. Session Technology 4: Feb 4 Future of ICs, Electronic Systems, Internet 5: Feb 11 Sensors, MEMS and the Internet of Things 6: Feb 18 Bio-Electronics, Bio-Sensors, Health Care, and DNA Sequencers 21/2 – 29/2 Mid-semester break, no class 7: Mar 3 Lighting, Displays, lasers, 3D printers, R2R Printing 8: Mar 10 Human-Computer Interfaces, Wearable Computing 9: Mar 17 IT and Transportation 10: Mar 24 Nano-technology and Superconductivity Note that slides for other technologies are also available on IVLE and my slideshare account (telecom, solar cells, energy storage, wind turbine) Technologies Experiencing Rapid Rates of Improve- ment and New Types of Higher Level Systems
  103. 103. Background Information on ICs  Geometric scaling – how reductions in scale led to improvements in performance and cost of ICs  How these improvements enabled the introduction of new types of ICs over the last 50 years  logic chips, memory, microprocessors, Application Specific ICs (ASICs), Application Specific Standard Products (ASSPs)  How these better ICs led to better electronic systems  computers, routers, servers, mobile phones, telecom, video game consoles, new software, Internet content  New technologies that enable further improvements in ICs and new forms of systems
  104. 104. Potential Projects (1)  New types of processes, transistors, ICs  Extreme ultra-violet photolithography  New types of transistors, e.g., new “FIN FET”  3D ICs – address specific types of ICs such as memory, microprocessors or combinations of them  Replacements for flash memory: phase change memory (PRAM) magnetic RAM (MRAM), Ferroelectric RAM (FeRAM), and resistive RAM (ReRAM). And impact on computer architecture  Synaptic, AHaH, and quantum computing  Molecular and atomic transistors  Transistors made from ultra-thin materials (e.g., graphene, molybdenum sulfide, boron nitride, transition metal dichalcogenide, and other materials)
  105. 105. Potential Projects (2)  New types of electronic products, services, and systems  New types of mobile phones, computers, smart watches  Biometrics  New types of enterprise (sales, engineering, operations, human resources, legal, blogs), security, database, big data, and advertising software  New types of e-commerce, services and content for computers and smart phones  New types of financial services  Impact on journalism, education, architecture, other professions  More efficient construction (e.g., pre-fab housing by DIRTT, fast construction by Chinese firms)  Increasing Use of Open Source Software and Their Impact on Electronic Systems (See Git hub and Source Forge for list of software)
  106. 106. Session Technology 4: Feb 4 Future of ICs, Electronic Systems, Internet 5: Feb 11 Sensors, MEMS and the Internet of Things 6: Feb 18 Bio-Electronics, Bio-Sensors, Health Care, and DNA Sequencers 21/2 – 29/2 Mid-semester break, no class 7: Mar 3 Lighting, Displays, lasers, 3D printers, R2R Printing 8: Mar 10 Human-Computer Interfaces, Wearable Computing 9: Mar 17 IT and Transportation 10: Mar 24 Nano-technology and Superconductivity Note that slides for other technologies are also available on IVLE and my slideshare account (telecom, solar cells, energy storage, wind turbine) Technologies Experiencing Rapid Rates of Improve- ment and New Types of Higher Level Systems
  107. 107. Background Information  Falling cost of sensors, ICs, MEMS, transceivers, cellular and WiFi services, and energy harvesters for Internet of Things  Reductions in scale drive improvements in performance (e.g., sensitivity) and cost of MEMS, including falling power consumption  examples include: filters for mobile phones, micro-gas analyzers, ink jet printers, bionic eyes  Internet of Things will provide large value for some types of products and systems  Examples of structural monitoring, fracking and Energy  Fishing and Agriculture, Drones, Retail, Smart Homes  Internet of Toys, Food Packaging
  108. 108. Potential Projects  Internet of Things, Big Data Wireless sensors  Putting GPS, transceivers, other sensors in everything  New types of MEMS and energy harvesters and better analyses of cost and performance trends for them  Products and systems that will benefit most from adding Internet connections  A better analysis of ones covered in class and/or done in previous student projects  Or new products and systems  But not just hardware  Also new software for IoT including cloud computing, open software, big data, database
  109. 109. Potential Projects (2)  Monitoring of Structures  Oil, Gas, Pipelines, Fracking, Mining  Agriculture, Fishing, Mining  Food packaging and sensors  Commercial Drones  Retail and Logistics  Smart Homes  Internet of Toys  Other Aspects of Smart Cities  Free Routing of Aircraft
  110. 110. Session Technology 4: Feb 4 Future of ICs, Electronic Systems, Internet 5: Feb 11 Sensors, MEMS and the Internet of Things 6: Feb 18 Bio-Electronics, Bio-Sensors, Health Care, and DNA Sequencers 21/2 – 29/2 Mid-semester break, no class 7: Mar 3 Lighting, Displays, lasers, 3D printers, R2R Printing 8: Mar 10 Human-Computer Interfaces, Wearable Computing 9: Mar 17 IT and Transportation 10: Mar 24 Nano-technology and Superconductivity Note that slides for other technologies are also available on IVLE and my slideshare account (telecom, solar cells, energy storage, wind turbine) Technologies Experiencing Rapid Rates of Improve- ment and New Types of Higher Level Systems
  111. 111. Background Information  Improvements in bio-electronics, including bio-electronic ICs  Type of MEMS with micro-fluidic channels  Benefit from reductions in scale  Number and types of bio-sensors is growing  Improvements in them are making new forms of  diagnostic equipment, skin patches, bio-sensors  phone attachments, drug delivery, bionic eyes, exoskeleton  organ-on-a-chip economically feasible  Big Data and Health Care  Improvements in DNA sequencing and synthesizing enable new forms of drug, crop, and material development
  112. 112. Potential Projects  New forms of diagnostic equipment, including lab-on- a chip  New bio-sensors and attachments for mobile phones  New forms of skin patches  Smart prosthetics (e.g., exoskeletons)  New forms of drug delivery, smart pills, implanted electronics  Organ on a chip
  113. 113. Potential Projects (2)  Big Data and Internet of Things for Health Care  New forms of software for health care including  HR software, hospital software, personal software, data base software  How can DNA sequencers and synthesizers help us develop better crops, biofuels, other materials?  What will these new crops, biofuels and other materials probably be?
  114. 114. Session Technology 4: Feb 4 Future of ICs, Electronic Systems, Internet 5: Feb 11 Sensors, MEMS and the Internet of Things 6: Feb 18 Bio-Electronics, Bio-Sensors, Health Care, and DNA Sequencers 21/2 – 29/2 Mid-semester break, no class 7: Mar 3 Lighting, Displays, lasers, 3D printers, R2R Printing 8: Mar 10 Human-Computer Interfaces, Wearable Computing 9: Mar 17 IT and Transportation 10: Mar 24 Nano-technology and Superconductivity Note that slides for other technologies are also available on IVLE and my slideshare account (telecom, solar cells, energy storage, wind turbine) Technologies Experiencing Rapid Rates of Improve- ment and New Types of Higher Level Systems
  115. 115. Background Information  Improvements in efficiency (new materials) for past and new forms of lighting and lasers  Incandescent, fluorescent, and compact fluorescent  LEDs (light emitting diodes), OLEDs (Organic LEDs), lasers  Improvements in old and new forms of displays  LCDs, including 3D Displays  Organic Light Emitting Diode (OLEDs) based displays  Flexible displays  Holographic displays  Geometric scaling in liquid crystal displays (LCDs)  Larger (and thinner) substrates/production equipment lead to lower costs  Also with roll-to roll printing
  116. 116. Potential Projects (1)  New forms of lighting  LEDs or OLEDs  Smart lighting: combine motion sensors and LEDs/OLEDs to provide more effective and aesthetic lighting  Lighting as a Service  New forms of systems from LEDs and lasers  LEDs for greenhouses  3D printers  Scanners for different applications including those that involve 3D printing  LiFi – Light field communication
  117. 117. Potential Projects (2)  New forms of displays  Organic Light Emitting Diode (OLEDs) based displays  Electronic paper such as that used in eBooks  Flexible displays, holographic displays  New applications of displays  3D Televisions  Public displays  Home displays: kitchens and living, dining, and bathrooms  Smart watches, or wrist displays  Impact of better displays on daily activities  Roll to roll printing of displays and other technologies
  118. 118. Session Technology 4: Feb 4 Future of ICs, Electronic Systems, Internet 5: Feb 11 Sensors, MEMS and the Internet of Things 6: Feb 18 Bio-Electronics, Bio-Sensors, Health Care, and DNA Sequencers 21/2 – 29/2 Mid-semester break, no class 7: Mar 3 Lighting, Displays, lasers, 3D printers, R2R Printing 8: Mar 10 Human-Computer Interfaces, Wearable Computing 9: Mar 17 IT and Transportation 10: Mar 24 Nano-technology and Superconductivity Note that slides for other technologies are also available on IVLE and my slideshare account (telecom, solar cells, energy storage, wind turbine) Technologies Experiencing Rapid Rates of Improve- ment and New Types of Higher Level Systems
  119. 119. Background Information  New forms of human-computer interfaces (HCI)  Touch, Voice, Gesture, Neural  Emphasis on new forms of touch displays  Impact of improvements in ICs, cameras, sensors, magnetic imaging on these interfaces  Augmented reality (cameras and phones)  Virtual Reality  Wearable computing  For different body parts  E.g., Google Glass
  120. 120. Potential Projects (1)  New forms of touch, gesture, touch, voice, and neural interfaces  New forms of augmented reality  More details on wearable computing – where are the best places to put these computers?  New forms of virtual reality?  What kinds of applications might emerge, particularly non- game applications?  Can these applications reduce need for face-to face meetings?
  121. 121. Potential Projects (2)  New human-computer interfaces for specific applications (not just for typical users like us)  For example, Google Glass, Microsoft HoloLens, or other types of augmented reality for specific applications  assemblers can see drawings  construction workers can see through walls, wires, and pipes  prospectors can see through the ground  architects can see entire 3D image of building  similar systems could be useful for tourists, shopping, soldiers, and artists  Engineers can see new products and how they interact with our world  360 degree view for drivers and pilots
  122. 122. Session Technology 4: Feb 4 Future of ICs, Electronic Systems, Internet 5: Feb 11 Sensors, MEMS and the Internet of Things 6: Feb 18 Bio-Electronics, Bio-Sensors, Health Care, and DNA Sequencers 21/2 – 29/2 Mid-semester break, no class 7: Mar 3 Lighting, Displays, lasers, 3D printers, R2R Printing 8: Mar 10 Human-Computer Interfaces, Wearable Computing 9: Mar 17 IT and Transportation 10: Mar 24 Nano-technology and Superconductivity Note that slides for other technologies are also available on IVLE and my slideshare account (telecom, solar cells, energy storage, wind turbine) Technologies Experiencing Rapid Rates of Improve- ment and New Types of Higher Level Systems
  123. 123. Background Information  Role of IT in Transportation  Better ICs and other components  Open Source Software  Improvements in IT are improving economics of  Mobile phones and GPS for buses  Private bus and ride sharing services through mobile apps  Mobile phones and GPS for bike sharing and combining bike sharing with trains  Roads dedicated to autonomous vehicles  Charging stations, both wireless and wired, for electric vehicles  Will this lead to fewer private vehicles?
  124. 124. Potential Projects  Mobile phones and GPS for buses  Private bus and ride sharing services through mobile apps  Use big data to identify new bus routes (mini-and full size buses)  Mobile phones and GPS for Bike sharing  Roads dedicated to autonomous vehicles  Charging stations for electric vehicles  Wired charging  Wireless charging  Note: for all topics, future projects must go beyond projects done in previous semesters
  125. 125. Session Technology 4: Feb 4 Future of ICs, Electronic Systems, Internet 5: Feb 11 Sensors, MEMS and the Internet of Things 6: Feb 18 Bio-Electronics, Bio-Sensors, Health Care, and DNA Sequencers 21/2 – 29/2 Mid-semester break, no class 7: Mar 3 Lighting, Displays, lasers, 3D printers, R2R Printing 8: Mar 10 Human-Computer Interfaces, Wearable Computing 9: Mar 17 IT and Transportation 10: Mar 24 Nano-technology and Superconductivity Note that slides for other technologies are also available on IVLE and my slideshare account (telecom, solar cells, energy storage, wind turbine) Technologies Experiencing Rapid Rates of Improve- ment and New Types of Higher Level Systems
  126. 126. Background Information  Nano-technology is general term representing continued  reductions in feature sizes (<100 nanometers)  these reductions in size increase importance of certain physical phenomena (e.g., quantum effects)  Improvements are occurring in  Fullerene, Carbon Nanotubes, Graphene and many other ultra thin materials  Quantum Dots, Nanoparticles, Nanofibers  Improvements in superconductors primarily from creating new materials/processes  Increases in critical temperature, current densities, magnetic fields, Reductions in cost  Applications: computing, energy
  127. 127. Potential Projects (1)  Cost and performance trends for Fullerene, Graphene, Carbon Nanotubes, Quantum Dots, Nanoparticles, or Nanofibers  Increasing number of ultra-thin (single- or double atom) materials  What kinds of materials and complex systems will emerge as these materials are combined with each other and with graphene?  Applications for CNTs and grapheme: include transparent electrodes, flywheels, aircraft and vehicle bodies  Applications for Quantum Dots, nanoparticles, nanofibers  How will these applications impact on higher level systems?
  128. 128. Potential Projects (2)  To what extent are superconductors getting cheaper and better?  How are these improvements in superconductors making new applications economically feasible  Energy generation, distribution, and transmission  Quantum computers  Magnetic levitating trains (MagLev)  Google’s purchase of a quantum computer from D- Wave increased interest in quantum computers
  129. 129. Summary  Technologies that experience rapid improvements in performance and cost or systems composed from them are more likely to become economically feasible than are other technologies  Understanding the technologies experiencing rapid rates of improvement can help us better understand the future  We will learn  drivers of improvements in Session 2  about the dynamics of technology change including the dynamics of economic feasibility in Session 3  Specific technologies in Sessions 4 to 10  How to analyze technologies and present your findings throughout this module
  130. 130. Forming Groups  Start now!  I let you form your own groups in order to make it easier for you to choose a project theme/research topic that is closer to your interests  Please start as soon as possible  Number of students/per group:  If there are <40 students, 3-4 students per group  If >40 students, 4-5 students per group  If >50 students, 5-6 students per group  If you can’t find a group, please let me know
  131. 131. Who am I (1)  Education  B.S. in Physics  Graduate studies in Electrical Engineering  M.S. Mechanical Engineering (Carnegie Mellon University)  Interdisciplinary Ph.D. (Engineering & Public Policy) from Carnegie-Mellon University (1984)  Worked at Hughes Aircraft on semiconductors (1978-1980) and Westinghouse (1985-1990) on implementation of new design and manufacturing techniques/technology  Taught at  Pennsylvania State University (1991-1995)  Kobe University (1996-2003)  Hitotsubashi University (2003-2007)  NUS (from 2007)
  132. 132. Who am I (2)  Research:  Management of Technology: Product Development, Standards, Modular Design and Vertical Disintegration Technological Discontinuities,  Mobile Phone: many years. Received the DoCoMo Mobile Science Award for lifetime contributions in mobile communications in 2004  Publications  About 40 papers in refereed journals  Six books  Consulting: Bouygues Telecom, Nokia, NTT DoCoMo, Vodafone, Gehrson Lehman, Panasonic, Vodafone, Motorola, Huawei, Texxi
  133. 133. Who Am I (3)  Six books, the two most recent  Technology Change and the Rise of New Industries, Stanford University Press (2013)  Exponential Change: What drives it? What does it tell us about the future? (2014); Price is 0.99USD http://www.amazon.com/dp/B00HPSAYEM  Exponential Change can also be read on other devices besides Amazon Kindle. Here are appropriate apps:  http://www.amazon.com/gp/feature.html?docId=1000493771  Summaries of recent books in papers  What Drives Exponential Improvements, California Management Review, Spring 2013  Rapid Improvements with No Commercial Production: How do the improvements occur, forthcoming, Research Policy
  134. 134. "Explaining much about innovation that others have ignored, Funk helps us better understand how improvements in costs and performance occur with new technologies. While the conventional wisdom suggests that costs fall as cumulative production increases, Funk shows us that the reality of this relationship is different and more interesting. For example, technologies that benefit from reductions in scale (e.g., integrated circuits) have seen dramatic advances; finding these kinds of technologies (and products based on them) is a major task for R&D managers.“ —Christopher L. Magee, Professor and Director, Center for Innovation in Product Development, Massachusetts Institute of Technology
  135. 135. Jeff Funk examines what it will take to realize the potential of new technologies for innovating out of the economic challenges that we face. He argues that many theories of innovation are incomplete, outdated, or just plain wrong, and that new insights are sorely needed to address such issues is how much time will be required to get alternative energy technologies to the mass market“ Anita M. McGahan, University of Toronto and Author of How Industries Evolve "Jeff Funk's provocative elaboration on Giovanni Dosi's notion of technology paradigms calls for a fundamental re-examination of conventional management wisdom about technologies and technology evolutions. In particular, Funk's clear exposition of the supply-side technology dynamics that drive disruptive innovations provides a long overdue corrective to the demand-side story widely advanced by Clayton Christensen, for example. More generally, Funk's framework for analyzing and predicting future technology trajectories establishes a new and essential perspective for both technology strategists and technology policymakers."—Ron Sanchez Copenhagen Business School
  136. 136. "Without resorting to singular case studies, Funk takes a sophisticated approach to characterizing techno- logical emergence and change, and the role that governments play in developmental trajectories. He builds a descriptive model using a historical analytical approach to reinterpret data from a host of industries. Based on this model, the book takes a daring a daring step to speculate on future technological developments in energy and electronics, providing sobering advice to those who think that government intervention is the panacea for national innovation.“ —Phillip Phan, Professor and Interim Dean, The Johns Hopkins Carey Business School "In this vitally important advance in the analysis of innovation, Funk explores the limits of learning curves as a mere function of forced or subsidized volumes. Learning has to be real, integrated, and multifaceted in order to benefit from different paths to improvement in cost and performance. Trenchantly demonstrating the need for multi-dimensional, supply side innovation in the case of clean energy, he shows the futility of our current demand-side focus."—George Gilder, venture capitalist
  137. 137. Session 4 Topics for Write-ups  Identify all the entrepreneurial opportunities for one of the following technologies  Big Data  WiFi Phones  3D ICs  E-commerce
  138. 138. Session 5 Topics for Write-ups  Identify all the entrepreneurial opportunities for one of the following technologies  IoT for agriculture  smart homes  food sensors  Drones
  139. 139. Session 6 Topics for Write-ups  Identify all the entrepreneurial opportunities for one of the following technologies  Skin patches  Smart contact lens  Attachments to mobile phones such as ultrasound and glucose meters (choose one of them)  New types of fish from DNA sequencing and synthesizing (GMOs)
  140. 140. Session 7 Topics for Write-ups  Identify all the entrepreneurial opportunities for one of the following technologies  Smart lighting  LiFi  Refrigerator displays
  141. 141. Session 8 Topics for Write-ups  Identify all the entrepreneurial opportunities for one of the following technologies  Google glass  Gesture interface  Health data recorded with wrist device  Augmented reality with cameras and phones
  142. 142. Session 9 Topics for Write-ups  Identify all the entrepreneurial opportunities for one of the following technologies  App-based ride sharing with multiple passengers  Dedicated roads for autonomous vehicles in Singapore  Electric vehicles in Singapore
  143. 143. Session 10 Topics for Write-ups  Identify all the entrepreneurial opportunities for one of the following technologies  Ultra-thin materials for aircraft  Quantum computers  Superconductors for energy transmission and distribution in Singapore  CNT for transistors

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