Social Media Leads the Future of Technology

By Martha Lagace at HBS Working Knowledge

Internet connected televisions, social media, and the power of simplicity were all cited as launch pads for future innovation in technology, according to a panel of experts that convened at Harvard Business School as part of the HBS Centennial Business Summit in October.

And though advertisers love the Internet, to what extent they can capitalize on these transformations remains an open question.

HBS professor David Yoffie moderated the session on "The Technology Revolution and its Implications for the Future," with panelists James Breyer (HBS MBA '87), partner of the venture capital firm Accel Partners; Susan L. Decker (HBS MBA '86), president of Yahoo! Inc.; and Eric Kim (HBS MBA '81), senior vice president and general manager of Intel Corporation's Digital Home Group.

The first computer, the ENIAC, cleared the path for future innovation in the late 1940s, said Yoffie, who set the context for the ensuing discussion. Today, millions of Web users generate free content, and we are witnessing an "explosion" in video and cell phone use, he continued, with more than 100 million smartphones already in use. In addition, there is the phenomenon of virtual worlds, where approximately 217 million online players interact.

This is an evolving landscape, with much growth remaining, Yoffie said. Of 6.5 billion people in the world, about 1.5 billion have Internet access, more than 300 million have broadband access to the home, and 3 billion have cell phones, a growing number of which offer Internet access.

What these statistics suggest is that "the most precious currency today is information," said panelist Jim Breyer, an early investor in Facebook and a director of Wal-Mart Stores. "Each year there is more information created on the Web than in all the previous years combined. Investment initiatives are around participating in the information flow. We [at Accel] are interested in companies that help us understand how to structure information, communicate, categorize some of that self-generated information, and then act on it."

A sticking point currently for businesses is spanning the gap between the physical and the digital world, he continued.

"Right now there are significant problems understanding how to take what we are getting at point of sale in the physical world environment—very valuable info on customers—and how to integrate it with all the information that is being generated on the Web. To date, there is no company that allows one to take quickly all this information 'in the cloud' and integrate it with the vast arrays of information in the physical world."

Difficulties aside, Breyer said the promise of technology meant that innovation to solve a problem could arrive from any quarter: prominent companies, nonprofit enterprises, "two students in a dorm room, or mothers or fathers after they have done their school pickups." He continues to be impressed by businesses that start with little capital—anywhere from $10,000 to $50,000—yet get to scale quickly and build new applications on the Web.

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