Prajakta discusses emerging trends in technology and connectivity with her professor Mankad Sir over coffee. She outlines 3 major trends: 1) Increased digital connectivity through video conferencing and social media. 2) Expanded GPS and satellite connectivity, allowing communication between cars and infrastructure. 3) Growth of communal connectivity through broadband internet, strengthening public services, education, healthcare and civic engagement. However, she also notes potential trade-offs, such as loss of personal identity, intellectual property issues, and risk of hacking. When asked how markets might adjust, Prajakta describes how networks and infrastructure will develop to support technology, software/hardware will improve efficiency, and businesses will find new models to increase internet usage.

1. McKinsey’s emerging trends
And
Mankiw’s Principles of Economics
Figure 1: The connected world
Individual assignment Managerial Economics
By – Prajakta Talathi
GSEP13CMM031

2. One fine evening Mankad Sir and his student, Prajakta were chatting over a cup of
coffee after Microeconomics class. Mankad Sir asked Prajakta what she thinks will happen
to technology in the coming decade. Coming from engineering especially IT Background,
Prajakta replied promptly “Connectivity will change the way we live”
Amused, Mankad Sir asked, “How will Technological connectivity transform the way
people live and interact?”
Figure 2: Mankad Sir and Prajakta chatting at coffee table
To this Prajakta replied, “Today we are at the early, not mature, stage of this
technology revolution. Individuals, public sectors, and businesses are learning how to make
the best use of Information Technology in designing processes and in developing and
accessing knowledge. More transformational than technology is the shift in behaviour that
enables it. In future, boundaries and geography will not be the primary constraint on the
limits of social and economic organization.”
Figure 3: Technology Revolution and Connectivity

3. Sir said, “Prajakta, there are few areas which are already using connectivity like:
 Digital Technology – Telecommunication, internet etc.
 Flights – Flight signals
 Railways – Railway Signals
 Satellites – Satellite broadcasting, satellite communications etc.
 Ships – Naval Signals
 GPS – Uses satellite communication
 Radio – Air or frequency communication
Then what will be the change in future?”
Prajakta said that, “Largely all signals or communications these days have been
converted into digital communications. To explain this better let us keep the scope of our
conversation limited to Digital Connectivity”
“Sir, I am sure you are aware of the Present Applications of Connectivity:
In additiontogrowingconsumerneeds, government,business, library, research, education,
healthcare, and community, institutions require high-speed connectivity in below sectors:
 Education – Facilitates Online or distance education, provides interconnected educational
software
 Environment – Reduces carbon emissions by reducing travel using telecommuting, video
conferencing and high-quality video collaboration
 Public Safety – Makes use of Video cameras, enhances information sharing
 Healthcare – Increases accessto healthcare,Enablesremoteanalysisof medical information
 Smart Infrastructure Development–Supportsdistributednetworked sensors and actuators
 Civic Engagement and Access to Information – Fosters a greater civic discourse”
Figure 4:Present Applications of Connectivity

4. Sir: “Yes Prajakta, what I want to know are the Trends in near future for technology and
connectivity:”
Prajakta: “Sir, as you are aware that, with the rapid advancement in technology, the near
future shows looks bright for technology. Effective technology facilitates connectivity between
human and human, human and machines and machines and machines etc.”
“Let me throw some light on 3 most promising trends:
1. Digital Connectivity– The most widespreaduse is Digitization of technology. The emerging
trend in communication technology is video-conferencing and telecommunication using
medialike Skype,WhatsAppetc.Informationsharing viaYouTube,Wikipedia etc. and social
networking through sites like Facebook and LinkedIn, will take a huge leap. All thanks to
these means that I am able to comfortably and at cheaper rates talk to my parent back in
Mumbai.
Notso surprising, Robotswill replace human services and using mobile phones and
internet, commands can be given to these robots. Additionally home appliances will have
devicesorchipsfittedin,whichcanbe directedbysending codes. This will reduce time and
improve efficiency of homemakers.
What fascinatesme the mostisthe currentboom in video-conferencing, which will
introduce 3-dimensional communication using the technique of telecommunication and
objectprojections. Social networkingandinformationsharingwill bringthe worldcloser and
eliminateboundariesatleastvirtually. Inhealthcare sector,informationsharingwill enhance
integration of clinical data and improve point-of-care systems that will provide better
treatment and fewer medical errors.
Web services like YouTube or 4shared, created the conditions to disseminate
cultural artefacts head to head with the mainstream forms of culture. Previously invisible
voicesfromthe region’speripherieswerethusempoweredbytoolslike social networks and
torrents, by-passing the traditional media channels.”
Figure 5: Information Sharing and Social Networking

5. Sir, “That’s good Prajakta, What else do you think?”
Prajakta:“Sir,I wish that we take the privilege of satellite communication to a higher level
and do something good to society.”
Mankad Sir: “Like what Prajakta?”
Prajakta –
2. GPS/Satellite Connectivity–Will make optimumuse of satellite communication.Apart from
road directions and navigations, signals transmitted via satellite will be used by cars for
communication.Thiswill help in reducing the number of road accidents. It will also help in
traffic controlling and diverting. One of the added advantages will be observed during
emergencies, where cars will communicate amongst each other and help in redressing.
E.g. ambulance and firefighting or police chasing vans will communicate with the
cars on road and other cars can free lanes and allow these vans to pass. Also, in case of
accidents or car break downs, cars can communicate internally and contact the nearest
desired service providers. General Motors has already begun research and started
implementing this technology in their upcoming cars. Isn’t it interesting!
Satellites can be used to communicate with other Planets and Moon and this
communication can be used in foreseeing a natural calamity and thereby helping in taking
preventive measures.”
Figure 6: GPS/Satellite Connectivity 2. GPS/Satellite Connectivity
Mankad Sir, “This is really very interesting. These days anything and everything is possible
withtechnology! Whatdoyouthinkwill happen to the government and society? Will they be open
to all this?”
Prajakta happily replied, “Of course Sir! Looking at the benefits, all will welcome the
changes.

6. 3. Communal Connectivity– Internetandbroadbandwill create anactive synergybetweenthe
digital and physical infrastructure of the state. Broadband will accelerate the type and
qualityof governmentalinformationdeliveredto consumers and will increase the ability of
all residents to take part in democratic governance.
Increasingbothaccessto and use of broadbandwill strengthenpublicsafetyresources, build
economic capital, expand educational and healthcare opportunities, improve living
standards and raise the levels of civic engagement and governmental transparency.”
Figure 7: Communal Connectivity
Laughing,MankadSir asked,“My dear Prajakta, I hope you know that there is no such thing
as free meal. Our future looks really good and I hope to see this prosperous future, but with my
experience I can surely say that everything comes with a price!”
Sad buthopeful,Prajaktareplied,“YesSir,youare speakingthe harshreality. Asrightly said,
‘Every coin has 2 sides’. And according to Mankiw, “Every choice involves trade-off”
Sir to Prajakta, “Now my child you are speaking economics. Can you please tell me three
trade-offs which you think are possible?”
Like always smiling Prajakta replied, “Sir being little emotional, I feel the biggest trade off
one will have to face is:
1. Losing identity and personal touch
The emergence of hyper-connectivityis changingnotions of identity of members of a social
network.To addto this and the proliferationof devicesandvirtuallyunlimited storage capacity;
internetallowspeople to document any aspect of their lives, creating a huge store of personal
data which is distributed across multiple platforms which can be data-mined by advertisers,
the government, service providers and hackers.”
“Secondly, how can I forget what I have learnt working for a giant IT company like Infosys,

7. 2. Violation of Intellectual Property Rights and Copyright
As anythingprefixedwith “e” might become a crucial issue in coming years, it will increase
the severity of questions raised on Piracy, Copyright and Intellectual Property Right.
If materials includingfilmsormusic, information,valuable resources,software are sharedon
across to the public, copyrightissues will arise. Proper measures need to be taken to curb such
incidents. The next few years will show whether the transition to multimedia will represent
another clash between intellectual property and social practices.
The nextfewyearswill have tremendous impact for our societies and intellectual property
researchers, educators, industry, policymakers and all will have to be prepared to anticipate
the technological changes that are rapidly transforming the ecology of access. Ignoring them
will not only hamper innovation, but also keep vast parts of the population living somewhere
betweenthe formal andthe informal world. Itwill create avastclass of citizensthat cannot fully
benefit from the expanding access to Internet Connection Technology without the stigma of
illegality.”
Figure 8: Violation of Intellectual Property Rights and Copyright
“And lastly, the nightmare of all,
3. Hacking of Information and Terrorism
The ease of accessto informationwillenhance the activities of hacking and terrorism. Even
if the data shared is through secured channels, as technology advances, security of data
tightens. Nevertheless the data is still prone to hacking and misuse.
Easily available information and improved encryption-decryption techniques will aid
terrorism. Using somebody else’s identity creating forgery over the digital channel will give
these activities an edge in case the technology advancement does not take the necessary
measures for protection of information.”

8. Figure 9: Hacking and Terrorism
Sir,“Yes itis true Prajakta.I understoodyourlasttwo trade-offs but could you please elaborate
what you meant by “Losing identity and personal touch”?
Prajakta cheerfully replied, “Happy to explain Sir.”
“The individual isseenasthe owner of theiridentity.Yet,there are increasingly trends that
might affect this principle. For instance, what rights do individuals have to their digital identities
afterdeath,whentheirarchivesandotheronline storeddatamaybecome opentohacking,criminal
exploitation,identitytheftandtocontrol by others? At the same time, however, there may also be
more opportunitiesfortracking and detecting criminal activities, through open source intelligence
Hyper-connectivity can have a positive impact on migrant communities keen to keep in
touch withtheirfamilyandfriends.However,the digital connectionandvideo conferencing will fail
to replace the emotional bondingor personal touch sharedwithinthe familyinphysical presence of
the family members.
Machines replacing human services will no doubt improve the efficiency of work but will
decrease the influence of humanbrainand emotions behind those services. For example, consider
cookingandservingbeingreplacedbyrobotsperformingthe saidtaskunder the command given by
itsmaster.The foodwill have the same taste whichwill eventuallybe monotonous.Also,the serving
will be manual andlackthe feelingof the host. The best analogy which can explain this is instead of
having my mom sing lullaby to me, I listen to some songs and sleep. This loses my mom’s familiar
touch. As a food gourmet I can also relate this to Dhoklas being cooked in microwave instead of
being steamed on gas. It loses its true essence.
Social networkingwill increase tremendously butwill it increase the human network or just
the digital network? Maintainingan online presence would become normalised to the point where
refusingtoparticipate inonline mediacouldappearunusualorevensuspicious. Wouldn’t this harm
the privacy of an individual?
Sir, my kids will have easy access to information, digital games, and resources, but it will
take away the fun of playingfieldgames,goingout and collectinguseful information etc. which we
had in our childhood.”

9. Figure 10: Losing identity and personal touch
Dreamily Mankad Sir smiles and says, “Of course I can see my granddaughters, they are
glued in front of either the television sets or laptops. Oh God bless the next generations!”
“Prajakta,coming back to economics, how do you think will market react to these trends?”
“Sir,I am a goodlearnerandat present all I can think of is Mankiw’s Principle 6: Market is a
good way to organize economic activities.”
To this Mankad Sir says, “Being a Gujju, I love to chat. And market is my favourite topic in
economics.Iwon’tletgooff you so easily. I want to know three characteristics of how will markets
vis-à-vis Digital Connectivity”
Prajaktasheepishlyreplies,“Youhave caught me on Economics Sir. But since we are talking
about Technology, I am sure my experience will come handy. To begin with the Market
Characteristics,”
1. Markets will adjust to support technology enhancements
Sir, let us first understand the history of technology changes. In 1991, when the world
adopted digital technology, there was a shift from 1G to 2G (G-Generation), followed by 3G in
2001 and now 4G in 2011. As per the trend in next 10 years we will have either 5G or 6G in
internettechnologydependingonthe speed of growth of technology and the nature of market
adaptability.”
“Of course, bigger the engagement, more are the rewards.
2. Engage and reward
Engage and reward broadband innovation and research. Develop model permitting
standardsand encourage collaboration among providers. Local competition will vanish and big
service providers will take charge. Technology development is a costly affair and eventually
providerslike Reliance,VodafoneandAirtel havinggreater economiesofscale will take the lead.
These players will have capital for research and innovation and for resources required.

10. “Infrastructure being the backbone, technology will not see its future in the absence of
proper infrastructure.
3. Infrastructure Developments
Countries will continue to partner with other providers to leverage everyone’s resources.
Optical fibresunderthe seawill be usedoptimum. Exponentially growing users of internet will
be in need for more and more bandwidth. Investment in broadband should not be limited to
physical infrastructure, but instead should include policies to increase adoption of broadband
technologies. Eventhoughbroadbandwill not existwithoutinfrastructure, government policies
must be geared toward creating the necessary infrastructure and for encouraging more and
more consumers.
“Sounds interesting Prajakta. Let us analyse the characteristic that “Markets will
adjust to support technology enhancements” of market in detail:
As far as I know, the adjustments focus on 3 important levers:
 Making broadband access affordable to all by making it more efficient to deliver
data
Your inputs on this?”
Prajakta: “Sir, I think that network connection speeds and adoption levels will
continue to increase around the world, because of availability of faster connections, and
affordability of such connections. LAN connections are getting cheaper since more and
more localities are coming together to form the network. Wi-Fi technology will become
more popular since 1 household will have lot of devices communicating with each other
wirelessly.
With the monopolistic competition in the market for internet service providers and
supporting devices, the consumer will be the beneficiary. We can consider the
introduction of 4G in the market. 4G being expensive and people have chosen the trade-
off between speed and price and so people are more using 3G at cheaper rates.”
Encouraging as he always is, Mankad Sir tells Prajakta the second lever:
 Using less data (bandwidth) by improving the efficiency of the software and
hardware
Understanding the lever, Prajakta replies, “Transition from IPv4 to IPv6 will take
place which will enhance the efficiency to deliver data. At present available IPv4 address
space is getting rapidly depleted, so according to me, there will be a rapid increase in

11. IPv6 adoption across all Internet Service Providers. Moreover content providers will start
making their sites, applications and other media available via IPv6.
Today an introduction of HTML5 has integrated multimedia and graphic usage in the
normal text. In future mark-up languages will improve and so will the compression
techniques.
Improved routers, hubs and switches will facilitate faster and efficient data delivery.
Software like apps and operating systems will be made compatible with the latest
technology. In case there is the technology gets revamped, the whole market will get
impacted making the older technologies obsolete like that of Android operating
System’s entry in the mobile devices, throwing the Symbian OS out of the market.”
“Wohoo! Very much technical Prajakta! Now let me tell you the third lever, which
definitely does not depend on technology. Now I will push you out of your comfort zone
of technology,” says Mankad Sir teasingly.
He continues with the last lever:
 Helping businesses to develop a new model to get more people to use the internet
Unsure yet confident, Prajakta tries to figure out the answer. “Government policies,
markets and non-profit initiatives are contributing to improve the overall connectivity in
the region. Providing more and more information and easy access to this information to
the users, more and more people will start using internet.
For countries like China and Africa, which have strict internet laws, the market
conditions behind the growth of technology will compel these laws to change.
One of the challenges ahead for us is precisely to better understand the
disconnection between the legal and regulatory system, and the connectivity practices
of the majority of the region’s population.”
Satisfied, Mankad Sir says, “Very Good Prajakta! I am impressed that you could very
well relate techno-eco-socio aspects together. I would like to conclude our interesting
discussion by saying that ‘The future of technology is uncertain but the growth in
technology and the overall standard of living of individuals and hence the growth of the
technologically advanced countries is certain!’ Hope to see you do well in this new emerging
world of connectivity”
Prajakta: “Thanks a lot Sir! I hope I was able to do justice to the economics you have
taught me so far!”

12. References:
Images taken from internet
Referred Wikipedia and investopedia for few terminology definitions
Mankiw’s Book: Principles of Economics