An Exponential Tomorrow

Host of the Exponential View podcast Azeem Azhar weaves today’s technology trends into a cohesive, urgent wake-up call. Exponentially improving computational, biological, manufacturing and energy technologies, he believes, will change the world profoundly in the coming decade. Azhar argues that unless 20th-century mind-sets and institutions adapt – and he doubts they understand the speed required to do so – a depressing future awaits.

Exponential Technologies

Technology operates, Azhar explains, within a complex system of existing norms, attitudes, cognitive capabilities, economics, geopolitics and international trade.

An inflection point has been reached, and we are witnessing our systems transforming before our very eyes.Azeem Azhar

The coming convergence of paradigm-shifting “general purpose technologies” (“GPTs”), each improving at least 10% each year for decades, will change the world quickly and profoundly.

Azhar takes as his starting point how home computers (PCs) hit the market in the late 1970s. Slow, and with a few megabytes of memory, these clunky, costly machines ran sophisticated programs and games. Only two decades later, PCs were millions of times more powerful, and much cheaper. They progressed according to Moore’s law, which states that computer processing power will double every two years. This exponential improvement in computing power enabled the integration of computers into daily life.

Exponential technologies such as photovoltaic cells, for example, increase in capacity, and decrease in cost so rapidly that solar power now costs less to generate than any other form of electricity.

We are no longer just living in a world of exponential technologies – but at a time when these technologies and their effects are a defining force in our society.Azeem Azhar

The spread of standardization – which makes components of many items interchangeable and easier to integrate – accelerates the combining technologies. Faster learning, increasing demand, the interoperability and combination of GPTs, and the vast, free flow of information drive the Exponential Age.

The Exponential Gap

Azhar cites Amazon, for example, which he regards as practical and realistic because it budgeted $36 billion for R&D in 2019. He believes its leaders understand what dominance requires in the Exponential Age. Tesla factored in exponential improvements in renewable energy, battery storage capabilities and price drops years before they occurred.

The exponential gap between the majority of the population – and their institutions – and those leading exponential companies might derail society. Exponential technologies of the Industrial Revolution, for example, drove enormous change. But national institutions – such as laws and workplace norms – required decades to catch up to and overcome the horrific conditions that industrialization inflicted on workers and their families.

The institutions that govern our economies today will soon cease to be fit for purpose.Azeem Azhar

Even within firms, disruptive technologies move faster than existing norms and culture. Kodak, for example, invented digital photography in the mid-1970s, but did not adapt to exploit its invention. Firms, nations and individuals who land on the wrong side of the exponential gap will fall even further behind firms and individuals driving change. The massive problems humanity faces demand that exponential technological improvements furnish solutions.

Superstar Monopolies

Google, Apple, Tencent, Amazon and Facebook dominate the world. Governments have never dealt with the flywheels these superstars create.

Firms such as Uber in transportation, Google in search and eBay in auctions rarely produce tangible products. They control and profit from the exchange of services and intangibles such as data. Firms aim for first-mover advantage, and compete aggressively to become the market – to own it. So consumers and governments have little choice but to participate in their markets, and follow their rules. These firms constantly acquire promising start-ups, suppressing competition and innovation.

Governments might give superstar monopolies a pass because so far, consumers and the economy seem to gain. Workers, on the other hand, experience the negative effects, whether selling through the platforms – such as Uber drivers or app developers – or laboring in the lower end of superstars’ value chains, such as Amazon’s giant distribution centers. Superstars’ relentless pursuit of automation does not result in job loss. Those who lose their jobs work for firms that automate passively or too late. Technologically sophisticated firms such as Amazon and Google continue to grow, and add workers alongside robots. 

Data network effects are a bit like a perpetual motion machine for intangible assets. The more these effects operate, the more they give.Azeem Azhar

Though AI and automation won’t result in fewer overall jobs anytime soon, automation renders current jobs less humane. Invasive spyware, sensors and algorithms, for example, measure every aspect of workers’ output. Platform gig work pits workers against each other to charge the least, or punishes them by algorithm for falling behind on delivery times or failing to ferry a sufficient number of passengers within a preset time frame. Some gig workers gain greater flexibility over their work lives, but others suffer low pay, no benefits, and no real rights. This evokes the worst aspects of the Industrial Revolution. 

The gaps between haves and have-nots and between elite and service workers may expand. To forestall or postpone this, governments could require firms to divest acquired assets when those acquisitions grant them too much power. As governments forced mobile firms to ensure interoperability, platforms might face the same stricture, so consumers can move data, recommendations and connections between them. Governments should classify platform players as utilities – essential services functioning under government standards and controls. 

A Grim Future

Podcaster Azeem Azhar weaves significant technology trends into a cohesive wake-up call. He argues that unless 20th-century mind-sets and institutions adapt and adapt quickly, a gloomy future awaits the majority. Azhar claims to be neutral, a mere reporter of observed phenomenon, but his essential message – unless you’re a stockholder or executive of the dominant exponential companies – is that until governments, citizens and societies adapt, the exponential future is going to leave them on the outside looking in. A convincing writer and astute observer, Azhar is not a policy futurist. He recommends few solutions and those are neither specific nor all that practical. But he does, for better or worse, identify and define today’s and tomorrow’s worrying trends.