After my last post on how you can blame Silicon Valley for Donald Trump, I got a lot of questions as to why productivity is stagnating. Stagnating productivity leads to people being angry with their economic well being and turning to easy sounding solutions spouted by Mr Trump. Silicon Valley is the self proclaimed world capital of innovation, but as of yet none of the Bay Area break throughs is accelerating the sluggish productivity growth.
But why? How is it possible that giving everybody in the world access to all the information in the world doesn’t show up in economic statistics? Here are five theories.
Hello, NewCo Shift readers. Thanks so much for reading. I’d like to share with you some of my favorites on our site right now:
Scott Rosenberg has a terrific piece on The Idea That’s Killing Mission-Driven Companies. If profit isn’t your only goal, congratulations. You’re now at odds with neoliberalism, the economic consensus of the last three decades (Lady Thatcher, above, was a severe proponent). Rosenberg dives deep into this much-cited but little-understood economic philosophy and shows what NewCos can do about it.
Preterm and underweight babies who survive their first month can still suffer severe long-term health problems — diabetes, heart disease, developmental delay. Keeping them warm can help prevent those problems. Founded in 2008 and based in San Francisco, Embrace Innovations has done just that for more than 200,000 babies across 14 countries with its simple, cost-effective infant warmers. It hopes to help even more babies in the developing world with an assist from its first commercial products.
Jane Chen, Embrace Innovations’ CEO and co-founder, tells NewCo that over the next few years the company wants to help one million babies. It’s created a consumer-facing product — Little Lotus. For every Little Lotus product purchased in the U.S., $25 goes toward the purchase of an Embrace infant warmer for use in the developing world. In the U.S., traditional incubators cost about $20,000; Embrace’s infant warmer costs just one percent of that.
Why are you outsourcing the future of your business to the tech industry?
A large company doesn’t sue the Department of Justice without thinking long and hard about whether such a move ultimately helps its business. But perhaps taking Apple’s recent tussle as a cue, Microsoft has done just that. This is all the more remarkable given the company was permanently scarred when it lost a major antitrust suit to the DOJ in 2001. If you lose to the government in a high profile case, the results can be catastrophic: A Microsoft executive involved in that case recently told me “we lost more than ten years” of innovation and industry leadership as a result. During those years, Google, Apple, and Facebook all rose to power, and Microsoft’s stock –and its reputation –both languished.
But there’s much more at stake here than the future of Microsoft’s business –as Microsoft’s executives and lawyers are well aware. It’s a bold (and perhaps opportunistic) move: go on offense and sue the very agency that litigated the company into a 15-year defensive crouch. Microsoft’s newest case will likely find its way to the Supreme Court. To win, the company will need help from all quarters: the tech industry and consumer advocacy groups, to be sure, but more important, from the stalwarts of the Fortune 500.
AI and the Internet of Things Have Arrived. Andy Rubin Wants Them To Play Together Nicely.
Smack in the center of Palo Alto, Calif., sits a huge warehouse featuring three-story ceilings and at least 15,000 square feet of open space. Standing as it does in the very zip code that gave birth to Google, Facebook, and HP, this building represents some of the most valuable real estate on the planet. Inside, a platoon of workers bend metal and install soundproof glass, readying the structure for its rebirth. If Andy Rubin and his backers have their way, this former apricot canning facility will become ground zero for a massive shift in how society and business understand not just data, computing, and the Internet, but the very workings of the world around us.