Glyn Moody: The great prize: open innovation

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talk given at European Parliament, 31 May. Details here: http://www.greenmediabox.eu/archive/2011/05/31/innovation/ and http://blogs.computerworlduk.com/open-enterprise/2011/06/the-great-prize-innovating-without-monopolies/index.htm

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Glyn Moody: The great prize: open innovation

  1. 1. the great prize: open innovation <ul>glyn moody </ul>
  2. 2. <ul>once in a lifetime? </ul><ul><li>global society is passing through a major transition
  3. 3. transition from analogue to digital </li><ul><li>vinyl LPs to CDs
  4. 4. video tapes to DVDs
  5. 5. books to ebooks </li></ul><li>*not* once in a lifetime
  6. 6. once in a *civilisation* </li></ul>
  7. 7. the digital world <ul><li>the passage from analogue to digital touches most facets of modern life
  8. 8. most evident in the realm of content – music, film, text
  9. 9. brings need to move from approaches based on scarcity to those based on abundance </li></ul>
  10. 10. digital abundance <ul><li>marginal cost of a digital copy is close to zero
  11. 11. today: €50 memory stick, capacity 32 Gbytes, stores 5,000 songs
  12. 12. tomorrow: €50 memory stick, capacity 32 Tbytes = 32,000 Gbytes, stores 5,000,000 songs </li><ul><li>Spotify: 13,799,112 tracks </li></ul></ul>
  13. 13. digital knowledge <ul><li>day after tomorrow: able to put all recorded knowledge – text, sounds, pictures, video - on a memory stick
  14. 14. everyone with a smartphone can access *all* of it, anywhere
  15. 15. innovation driven not just by knowledge, but by connections
  16. 16. network effects – of knowledge, of knowers </li></ul>
  17. 17. ”analogue” innovation <ul><li>innovation in an analogue (pre-Web) world </li><ul><li>centralised
  18. 18. top-down
  19. 19. collaboration hard
  20. 20. not scalable </li><ul><li>The Mythical Man-Month (1975) : ”adding manpower to a late software project makes it later”
  21. 21. adding knowledge to traditional innovation makes it slower </li></ul></ul></ul>
  22. 22. ” digital” innovation <ul><li>new kind of innovation first appeared in the earliest digital domain: software
  23. 23. its birth and characteristics can be observed in the story of the free operating system, GNU/Linux </li></ul>
  24. 24. what's GNU? <ul><li>GNU born in 1984 at MIT
  25. 25. GNU is ”GNU's Not Unix” - a recursive acronym
  26. 26. one man's attempt to create a free version of the leading Unix operating system </li></ul>
  27. 27. a change of heart <ul><li>by 1991, GNU was still unfinished: it lacked a ”kernel” - the heart of the operating system
  28. 28. in March 1991, 21-year-old student Linus Torvalds started writing one ”just for fun” – in his Helsinki bedroom
  29. 29. key inflection was August 1991, when he opened up his ”Linux” project using the Internet </li></ul>
  30. 30. open innovation <ul><li>decentralised </li><ul><li>anyone, anywhere, could join in </li></ul><li>bottom-up </li><ul><li>people fed suggestions, problems and solutions to Linus </li></ul><li>collaboration easy </li><ul><li>Internet was more affordable </li></ul><li>scalable </li><ul><li>no formal training required – everything is out in the open </li></ul></ul>
  31. 31. Linus' Law <ul><li>Eric Raymond: ”given enough eyeballs, all bugs are shallow”
  32. 32. different people approach a problem in different ways
  33. 33. adding more people increases the probability that someone’s approach will matched the problem in such a way that the solution is obvious (”shallow”) to that person </li></ul>
  34. 34. power, economy, reliability <ul><li>91% of top 500 supercomputers run Linux </li><ul><li>1% run Microsoft Windows </li></ul><li>Google runs its services on millions of servers running Linux </li><ul><li>so does Facebook, Twitter etc. </li></ul><li>Android mobile phone system runs on Linux </li><ul><li>400,000 handsets activated daily
  35. 35. launched November 2007 </li></ul></ul>
  36. 36. open innovation projects <ul><li>open genomics </li><ul><li>Human Genome Project </li></ul><li>open access </li><ul><li>arXiv, Public Library of Science </li></ul><li>open content </li><ul><li>Wikipedia </li></ul><li>open data </li><ul><li>OpenStreetMap </li></ul></ul>
  37. 37. <ul>motivating open innovation </ul><ul><li>personal satisfaction ( aka ”fun”)
  38. 38. peer esteem
  39. 39. altruism
  40. 40. money </li><ul><li>but generally work is aligned with one or more of the above as well </li></ul></ul>
  41. 41. crowdsourcing <ul><li>open problem-solving (2004) </li><ul><li>not formal projects
  42. 42. open call for solution
  43. 43. self-selecting group respond </li></ul><li>large-scale, loosely-specified, no reward – UK MPs expenses
  44. 44. smaller-scale, tightly-specified, payment by results – DesignCrowd
  45. 45. mixed specification and payment terms – Challenge.gov </li></ul>
  46. 46. <ul>inducement prizes (1) </ul><ul><li>highly-directed, highly-rewarded, high-profile form of problem-based open innovation
  47. 47. Longitude Prize (1714) for simple way to determine ship's longitude </li><ul><li>£20,000 - determine longitude within 30 nautical miles (56 km)
  48. 48. worth €40 ,000,000 present-day money
  49. 49. won unexpectedly by clockmaker, John Harrison </li></ul></ul>
  50. 50. <ul>inducement prizes (2) </ul><ul><li>Orteig Prize (1919) for flying non-stop New York-Paris ($25,000) </li><ul><li>won by Charles Lindbergh 1927
  51. 51. 9 teams spent $400,000 </li></ul><li>instigated US aviation boom: </li><ul><li>300% more applications for pilot's licence in 1927; 400% more licensed aircraft in 1927;air passengers went from 5,800 (1926) to 173,400 (1927) </li></ul><li>huge media event </li></ul>
  52. 52. <ul>inducement prizes (3) </ul><ul><li>Ansari X Prize for building and launching a spacecraft capable of carrying three people to 100 kilometres above the earth's surface, twice within two weeks ($10 million) </li><ul><li>26 teams spent more than $100 million trying to win prize
  53. 53. $1.5 billion dollars spent on private spaceflight industry
  54. 54. widespread publicity </li></ul></ul>
  55. 55. <ul>inducement prizes (4) </ul><ul><li>more X Prizes </li><ul><li>sequence 100 human genomes within 10 days or less, $10,000 per genome ($10 million)
  56. 56. launching, landing, and operating a rover on the lunar surface ($20 million)
  57. 57. improved point-of-care TB diagnostic suitable for the developing world </li></ul></ul>
  58. 58. open inducement prizes (1) <ul><li>wide open </li><ul><li>Scotland's Saltire Prize - £10 million purse to reward wave and tidal energy breakthroughs: ”open to any individual, team or organisation”
  59. 59. 16 year-old Canadian won national science contest with drug cocktail for helping cystic fibrosis patients
  60. 60. largest pool of participants </li></ul></ul>
  61. 61. open inducement prizes (2) <ul><li>big problems, loose solutions </li><ul><li>inspire *and* liberate
  62. 62. need clear end-points, ideally with milestones against which progress can be checked
  63. 63. need maximum freedom for achieving those milestones and the final result </li></ul></ul>
  64. 64. open inducement prizes (3) <ul><li>transparent process </li><ul><li>participants can gain peer esteem and assume leadership roles
  65. 65. new communities can be created around problems
  66. 66. feedback from even wider circle of interested parties can be offered
  67. 67. provides broad educational benefits </li></ul></ul>
  68. 68. open inducement prizes (4) <ul><li>clear social benefit </li><ul><li>taps into altruism
  69. 69. motivates people to participate
  70. 70. easier to create sustained media interest
  71. 71. public is more engaged with prize and participants </li></ul></ul>
  72. 72. open inducement prizes (5) <ul><li>sharing </li><ul><li>encourage contestants to share results among themselves, through sub-prizes based on contributions, ”open source dividend” etc.
  73. 73. stops re-invention of the wheel
  74. 74. accelerates open innovation
  75. 75. adds to knowledge abundance
  76. 76. drives further open innovation
  77. 77. creates virtuous circle </li></ul></ul>
  78. 78. the great prize: open innovation <ul>[email_address] @glynmoody on identi.ca/Twitter opendotdotdot.blogspot.com </ul>

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