Ten forecasts for 2010 (Part2)

Hi again,

Continuing where I left off last week, we go straight to number five in my list of top ten trends for 2010.

Let me know what you think about my forecasts using the comments box below.

Charles

5 VCs come charging back

Getting funding from venture capitalists has become brutally hard over the last two years. Their reticence has been, in part, to the inability to sell on any investments in the secondary buyout market. In fact the secondary buyout market is in a dire condition – its worst in living memory.

In 2010 this will change. The buyout market is showing signs of bursting back to life, and since VCs love a cut price bargain this could be a spectacular recovery. Furthermore we should see the launch of a new £1bn government VC fund to offer investments of £2m to £10m to plug the “equity gap” which could kick-start the process.

4 The cost of borrowing will soar

Financial Times economics editor Chris Giles describes the latest inflation figures with the word: “Ouch”.

Consumer prices in December were 2.9 per cent higher than a year earlier, sharply above forecasts. The danger that the Bank of England’s quantitative easing (printing money, also known as Mugabenomics) is causing price inflation. The worst case scenario is that inflation gets high enough to require a sharp rise in interest rates – causing a nightmare for anyone who has borrowed money, such as homeowners and businesses.

What you need to do: Calculate exposure to rising interest rates. Hedge, using fixed interest rates if necessary.

3 Augmented Reality

The movie Avatar is the perfect art-form for 2010 – the year when technology really starts to intrude on reality. We’ll see digital books become commonplace, laptops and writing pads merge in the form of Apple’s iSlate and 3D will shake up the entertainment business. But the real star will be augmented reality – the real-time fusing of camera footage with digital enhancements.

iPhone owners can already experience the joys of augmented reality through apps such as Layar and Nearest Tube. This year you can expect a glut of aug-reality applications, from in-store video screens to websites using webcams and XBox games. Toyota is planning to introduce head-up displays onto even basic models.

What you need to do: Understand that this technology isn’t a fad, and isn’t expensive to develop either. For example, an augmented reality iPhone app can be developed for £10,000. Get investing!

2 Every business will become a software business

Seriously. Every business. Take farming, where the use of in-vehicle GPS and yield management software has transformed the harvest from a labour intensive event to a mechanised data harvest process. Combines use automatic steering so they can run at night, without drivers, to a path accurate to 2cm. The National Farmers Union forecasts that robots will soon perform all the heavy-duty manual tasks on the farm, from sowing, spraying fertilizer, sample taking and ploughing, leaving the farmer to stay indoors to play with his software.

Even physical, “real world” industries such as shipping and logistics are being taken over by the silicon chip. The world’s biggest container ship, the Emma Maersk, which is so big it would take a train 72km long to hold her cargo, has a crew of just twelve. The ship can sail from Hong Kong to Rotterdam without human input.

No profession is safe from this trend.

What you need to do: Retrain as a software engineer. Or consider early retirement.

1 Customers don’t believe you

We live in a cynical age – and this is the year when customers finally stop listening to what you say about your product and start relying on the opinion of their peers. Review sites such as Reevoo and ReviewCentre have been around for years, but consumers have started to use them in more aggressive ways. Smartphone apps mean customers can read online reviews whilst in store, in fact they can even bring up price comparisons and reviews by scanning in the barcode of any product using only their phone. Entrepreneurial businesses are endorsing this trend by actively encouraging customers to refer to review sites. Brother, Canon, Hotpoint and Kodak are just some of the brands which publish uncensored Reevoo listings on their own websites.

What you need to do: Acknowledge that consumers prefer honest, third-party advice to your own marketing message, and help them find and use that advice.

And the next 30 years?

  • 2014  Automatic house cleaning robots will have become common.
  • 2020 PCs as powerful as the human brain
  • Nanobots make eating obsolete
  • 2022  Life expectancy increases by more than one year per year, permitting immortality
  • 2030  Mind uploading becomes possible
  • 2040 People spend most of their time in full-immersion virtual reality
  • 2045  Machines supersede humans, developing a planet-wide dimension of super-consciousness. “The Singularity” is upon us.
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