The American Entrepreneur

The Internet Changes The World (Again)

I saw one of those editorial page cartoons the other day.  This one had a young boy, probably about nine years old, sitting at a computer terminal. His father says to him, “What are you doing, son?”

The young boy looks up at his dad and says, “It’s a new video game Dad --- you use a thing called “the Internet” to attack and destroy traditional American industries --- so far, I’ve killed off publishing, television, and the United States Postal Service. I’m right now at Level Four – formal education.”

Funny? You betcha. In fact, it’s scary funny. This young man could easily have mentioned the “travel,” and “retailing” industries as well. Let’s face it - the Internet is an equal opportunity road grader.

This cartoon came into my mind just yesterday, while I was interviewing a gentleman by the name of David Silver.  Author of some 32 books, one of Silver’s latest tomes, written in 2006 and called “Smart Start-ups,” is almost as frightening to read as is “One Second After” (William Forstchen’s fictional account of an EMP attack on America) in that it predicts a future whereby Web sites no longer depend upon advertising revenue to survive and prosper. Instead, Silver predicts a society driven by affiliated bloggers who share a common passion.

Let me explain. When Silver was hypothesizing the direction of the Internet back in 2006, one of the things he saw was the ascendancy of Internet-based affinity groups. These groups, unlike their predecessors in the past, take full advantage of the very essence of this instantaneous, collaborative tool. So, and whereas in the past people would have to either physically meet at some enormous conference facility or sit for hours on the world’s largest teleconference, they can now instead go to their computer screen and “join minds” with their respective soul mates.

Maybe I can best explain this by using an example that Silver writes about; it’s a group called “Histers’ Sisters.” Basically, Histers’ Sisters (which I’ll refer to as HS) is made up of more than a half million women who have experienced, or are about to undergo a hysterectomy. By going to this site, these women can share their fears, their hopes, and their experiences with one another. In real time. They can also talk about their treatment --- what works, what doesn’t --- not to mention the fact that they can also critique that treatment.

What value! I remember clearly the day that I was told that I had cancer in my liver and pancreas, and that my cancer was known as “neuroendocrine cell” cancer. Hell, I knew nothing about cancer, much less the endocrine system, much, much less, neuroendocrine cell cancer. But I knew what I did know, and that was the fact that all I really wanted to do was talk to someone who had this exact same cancer and in the same organs. (Note: It turned out that there were damned few of these people in the entire world --- neuroendicrine cell cancer is extremely rare --- two of its 15,000 annual victims, by the way were/are deceased Lt. Gov. Catherine Baker Knoll and current Apple CEO, Steve Jobs.)

Imagine my glee wouldst that someone could possibly contact me to talk about his/her personal experience with this disease. (Note: I finally did make contact with one … that’s right, just ONE … person with N/E cell cancer, and boy did I bug the hell out of this guy!)

In 2004, no such site existed. But today, there is a site called PatientsLikeMe.com that receives, roughly, 100,000 unique visitors each month.

Now, here’s the game-changer. By its very essence, HS cannot deploy (nor even accept) commercial advertising! Think about it, this site has got to remain as pure and fresh as last February’s snow storm. Even one misguided advertisement could bring down the credibility of this site.

“So how then does HS make money?”, you ask. The answer is, “By providing access to the Sisters!” Specifically, HS regularly runs surveys and focus groups in and among its membership. These data are then compiled and tabulated and then sold off to such entities as drug companies, gynecologists, psychologists, and hospitals (among others). And from what I’m told, this company presently turns an enormous profit.

And why not? They have absolutely no cost of goods sold, a first-rate product (what could be more fresh?), nominal overhead, and --- they don’t even have to spend money marketing to site visitors.

Which begs the question: “Might this then be the company of the future?”

Sure seems like it to me. And if this is true, we might just kiss goodbye entities such as commercial radio, television, newspaper, magazine, and even billboards. All, gone. (Don’t forget our cartoon.)

Now, before you take the bridge, I can think of numerous reasons why this model may not happen. But I can also tell you that, prior to yesterday, I had not, and even in my wildest dreams, thought up a revenue model like this. Frankly, it’s just way beyond my ability to comprehend.

But I guess that’s also the good news. There are more applications and uses of the Internet yet undiscovered as have been discovered from the invention of this technology until this particular point in time.

I often tell my Duquesne students, “Find non-traditional solutions to traditional problems and you will very often be successful.” So, I present the same challenge to you, dear reader. Let me leave you with just this one last thought.

The other day on our radio show, we spoke with Dan Bricklin. For those of you under the age of 40, Dan Bricklin is the inventor of VisiCalc, which is generally regarded as the first ever software “product.”

So as I was talking to Dan about “Social Media” (BTW, “Social Media” is a term that I had not myself ever even heard of about until about a year ago), I asked him specifically about the new, “hot” product known as “Twitter.” “Ahhhh, Twitter,” he said, “I call Twitter The Product that allows you to actually feel disturbances in the force as they happen.”

I instantly knew what he meant. And then it struck me. “Damn it --- Twitter does enable me to “feel disturbances in the force.” Moreover, it enables me to feel those disturbances as they are happening!

Who’d-a-thunk it? Certainly not I. But think what a field day marketeers and communicators are right now having with this instant-feedback loop.

It’s a brave new world out there, folks. All I can tell you is “Keep your lines of defense fluid.” Build no Maginot Lines, as fixed fortifications are “Monuments to Man’s Stupidity” (to quote General George Patton). And when you’re fighting a battle and some young salesperson taps you on the shoulder, wanting to sell you a machine gun, buy it! Don’t just send him away.

And above all, hang out with enough young people to ensure that you stay, “fresh.” (Except my young people, that is.)

This last one is really, really important.

Respond

3 Comments

David Eson

Ron:

Love your show and listen to it when I can.  This article is right on.  I run an internet based food business that is changing the way people connect to locally produced vegetables, fruits, dairy products, meats and more.

Never in a million years would I take on the overhead of running a small market niche grocery store in a market where GE is dominant.  Instead, we use nimbleness, frugalness and innovation to bring healthy, local and organic products to consumers in the greater Pittsburgh region.

Check us out on the web at http://www.isidorefoods.com/

Kevin Holesh

I couldn’t agree more, Ron. The internet has a funny way of stripping down traditional barriers and allowing people to easily connect.

The best example I’ve seen in a while is Sal Khan. He makes educational YouTube videos and gives them away for free. He teaches anything from math to science to World War II history. He now has over 1,500 videos for students all over the world to view, some having never gone to school.

He singlehandedly runs the biggest school in the world. One guy on one computer with one microphone and he’s educated hundreds of thousands of students.

He has an interesting story and I suggest giving this video a look. He’s also quite funny:
http://vimeo.com/11731351

Josh Bulloc

Dear Ron,

I have 2 hypotheses about technology. 

1.    Technology (like money) is only an extension of who we are.  It will always trend toward our core nature; as in we are social creature so the internet makes it easier to be social (even if it is different to how you were social growing up).  If you want to make a ton of money study human nature and then make products that make it easier to answer to our nature.
2.  Many people do not realize that technology is generally only good at doing very simple tasks; it just can be done very fast and repeatedly.  This gives us 2 opportunities: to think less because the technology can do this for us or to use our brains for higher level thinking like problem solving and creativity.

Josh Bulloc
Kansas City, MO

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