1/ In 1968, former ARPA director J. C. R. Licklider published "The Computer As A Communication Device"
Given it was written right before the launch of the ARPANET, this is basically the founding document of the internet
And its predictions hold up remarkably well!
2/ For context: Mitchell Waldrop has called JCR Licklider "computing's Johnny Appleseed." As an ARPA director in the 60s, he basically funded half of the projects that became the internet
This paper was the brainchild of him & protege Bob Taylor, who later led Xerox PARC
3/ Licklider opens straight to the point:
"In a few years, men will be able to communicate more effectively through a machine than face to face."
"The programmed digital computer can change communication more profoundly than did the printing press and the picture tube"
4/ Networked computing existed before 1969. But the ARPANET was the first universal network, connecting different proprietary hardware / OSes. This was possible due to packet switching, with each node connected by new 'message processors' (basically the first routers)
5/ Licklider's paper is oftentimes cited as a precursor to cloud computing as much as the internet. Really, the two are intertwined
This 1968 description of a hypothetical ARPANET user basically sounds like developer opening up the AWS web console!
6/ Who's going to pay for the ARPANET? Moore's law will
7/ The promise of the ARPANET: inventing email, and… Zoom
"You will not send a letter or a telegram; you will simply identify the people whose files should be linked to yours"
"You will seldom make a phone call; you will ask the network to link your consoles together"
8/ One prediction that... hasn't quite panned out yet:
"You will seldom make a purely business trip, because linking consoles will be so much more efficient… you will spend much more time in computer-facilitated teleconferences"
9/ What else will be available via the ARPANET? Licklider proposed:
I've said it before, but I'll say it again: predicting the future is easy. Oftentimes the tech pioneers of the day will literally spell it out for you!
11/ The hard part is the gap between ideation and implementation. Despite the ARPANET launching in 1968, Licklider's ideas didn't *really* come to fruition until the invention of Netscape 26 years later
Are you prepared to wait that long?
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1/ A fun piece of tech history that I came across today: an online copy of Microsoft's 1986 IPO prospectus. At just 52 pages, a light piece of weekend reading!
2/ Most investors know 1980s-era Coke was an example of untapped pricing power - but *why* was this the case?
Turns out Coke was subject to a 100-year-old bottling agreement that had fixed its syrup pricing at $1 per gallon... in perpetuity! (+ later adjustments for inflation)
3/ The turning point was 1986: that's when Doug Ivester invented the "49% solution," a scheme to acquire Coke's old US bottlers and install discretionary pricing for the first time ever
Not coincidentally, Buffett starts buying stock a year later
2/ At its March 2006 launch, AWS was probably the 4th or 5th cloud service run by a Fortune 500 firm
HP launched its Flexible Computing Service in Nov 2005
Sun Grid went into beta in 2004
IBM launched "Linux Virtual Services" in 2002!
But AWS is the only one anybody remembers
3/ I'll focus on IBM here -
From the WSJ in *2002*: "Linux Virtual Services allows customers to run their own software on mainframes in IBM data centers and pay rates based largely on the amount of computing power they use"
Last year, I spent my winter holiday reading hundreds of pages of equity research from the 1999/2000 era, to try to understand what it was like investing during the bubble
A few people recently asked me for my takeaways. Here they are -
2/ Every document hereon comes from my former employer Bernstein Research's internal research archive, which extend back to 1994
Unfortunately, they're not available to the public (even Bernstein's client website cuts off at 2003), but happy to give more details if necessary
3/ LESSON #1: Everybody knew it was a bubble
Unfortunately, the quip "it's not a bubble if everyone says it is" just isn't true
Investors were comparing the internet sector to tulip mania as early as mid-98. Bernstein held an entire conference on it in June 99!
1/ In September 1993, then-Microsoft exec Nathan Myhrvold wrote his landmark memo "Road Kill on the Information Highway", laying out a dozen-ish predictions on the rise of the internet
27 years later, I think it's a super interesting case study. Let's evaluate the predictions -
2/ PREDICTION #1: The rise of a surveillance society - police bodycams, CCTV, 24/7 personal recording, and deepfakes
GRADE: A-
Pretty close!
3/ PREDICTION #2: Telecommuting, an end to the "tyranny of geography" and gerrymandering
GRADE: B-
Alas, the electoral college still matters today. The WFH prediction hits closer, but turns out it took two and a half decades + a pandemic to get things going
1/ One of the biggest macrohistorical tech trends that I feel like nobody talks about is the triumph of closed systems over open systems in the last 20 years
2/ Openness used to be the default. PCs beat mainframes, Windows beat Mac OS, the WWW beat AOL, etc.
As a result, industry literature from the 90s emphasized cooperation - Hal Varian's seminal 1999 book on internet economics devotes 70 pages to the art of standard setting alone
3/ Meanwhile in 2020, major platforms are closed by default
Today, you can't port your data between social networks - or for that matter, between clouds. iOS is obviously closed. And I don't even know what an open version of Uber would look like.