Wrong predictions

Forecasts that come true are easily forgotten. The prophet who live to see his prediction falsified by reality wishes it would slide into oblivion. But precisely these statements are echoed hilariously because, with superior hindsight, we know better than the famous person who made the prediction.

There are several interesting books about the phenomenon. Steven Schnaars’Megamistakes is one of the nicest. Several websites also carry nice collections of bad forecasts, e.g. this Wikipedia page.
Here’s a collection of my favourite forecasts that are off the mark.

  • “Computers in the future may weigh no more than 1.5 tons.”
    — Popular Mechanics, forecasting the relentless march of science, 1949
  • “I think there is a world market for maybe five computers.”
    — Thomas Watson, chairman of IBM, 1943
  • “There is no reason anyone would want a computer in their home.”
    — Ken Olson, president, chairman and founder of Digital Equipment Corp., 1977
  • “This ‘telephone’ has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us.”
    — Western Union internal memo, 1876.
  • “640K ought to be enough for anybody.”
    — Attributed to Bill Gates, 1981, but believed to be an urban legend
  • “Who the hell wants to hear actors talk?”
    — H. M. Warner, Warner Brothers

  • Collected forecasts

    The one thing that’s certain about forecasts is that they never come true. That doesn’t mean they’re useless. In mature markets, sales don’t change overnight and the error usually is marginal. In emerging markets, the hockey stick forecast can be too early and/or too high. By collecting curves of two or three years in a row their reliability will become clear.
    Market research companies love new markets with uncertain and dynamic outlooks, since that’s when they can sell and sell again their research reports to product marketeers who need to justify their new product business and investements with company management. In fact “in every new business area there’s a period in which the only people making money are market researchers and conference organizers”. (I call this Odijk’s rule)

    An alternative to buying a complete well-digestible report is to collect the snippets of data that appears in newspapers, press releases of market research firms etc. Analyze and compare data from various sources and moments in time, and most often a good picture of the market arises.
    This is a page of snippets (just started: I forecast that the data will double every week, for the next 4 weeks) . See if you can get the big picture.

    btw: For, often funny, forecasting mistakes see the post “wrong predictions”

    Mobile devices, software and Apps

    Tablet sales

    The next graph by IHS iSupply is looking back, so these numbers are an estimate of actual sales.

    And here’s a prediction from IDC:

    Chart: Worldwide Media Tablet Shipments Split by OS Historical and Forecast* 2010 – 2016 (Units in Millions)Description: Kindle’s latest performance threatens the iPad’s future.Tags: IDC, Tracker, Worldwide, Media Tablets, Media Tablet, OS, Android, iOS, Apple, iPad,Author: IDCcharts powered by iCharts


    Apparently, the ww sales of apps are 11.7 B$ in 2012. If that’s true, the number for 2015 number of $ 37 B makes sense. A further check shows that Gartner states 15.1 B$ for 2011, an even bigger market already.

    Wireless technologies

    Devices with embedded wireless local area networking (WLAN) capability

    Below figure comes from a study published in April 2011 by IHS iSuppli

    The growth in WLAN-enabled devices has been led by cell phones, with 512.8 million units projected to ship this year. Mobile PCs are a distant number two, with 230.1 million set to ship in 2011.
    Future WLAN-enabled device growth, however, will be spurred by newer categories of embedded devices. IHS iSuppli contends that automotive installations will lead the growth curve, with a compound annual growth rate of 98.2 per cent from 2010 to 2015. WLAN-enabled televisions will be close behind, with a growth rate of 77.8 per cent during the same period.

    More to follow ….

    Art, Innovation and S curves (on Anish Kapoor)

    An excellent documentary by Heinz Peter Schwerfel, “The world according to Anish Kapoor” lets the artist talk about his impressive and intriguing sculptures. Last night when the ‘Ars Longa’ art circle of Son en Breughel replayed the documentary, it struck me that it was as if you hear a silicon entrepeneur talk about his start-up’s business approach.
    “The studio is a place of experimentation. So what I want to do is fail, and fail often, fail fast.Not to take months or years to fail at something, that’s terrible. I want to go through ideas as quickly as possible and fail at them if they have to, but fail fast.”
    Compare that to what Steven Johnson has to say in “Where good ideas come from”:   “It’s no accident that one of the mantras of the Web startup world is fail faster. It’s not that mistakes are the goal— they’re still mistakes, after all, which is why you want to get through them quickly. But those mistakes are an inevitable step on the path to true innovation.”

    Or take Tina Seelig, Executive Director of the Stanford Technology Ventures Program: “The secret sauce of Silicon Valley is failure. To develop more successes, entrepreneurs have got to take a risk. Venture capitalists fund risk and, by association, failure, in order to find the “hits” in the haystack. Failure is a perfectly acceptable part of the entrepreneurial process, provided that the smart entrepreneur learns from their errors along the way.”

    Kapoor’s risk taking can’t be denied. His Cloud Gate sculpture in Chicago was estimated to cost $ 6M, but came out at $ 23M and it wasn’t publicly funded, that’s all individual & corporate donations. (of which $ 3M came from the opening’s gala diner)
    And …”Kapoor’s contract states that the constructed piece should be expected to survive for 1,000 years.
    The entrepreneurial artist is a collateral effect of the economic crisis, as new courses, institutes, and a European Commission report testify. \So if that’s what you aspire, take a look at the rest of this site and find that I have the required skills and experience to teach and assist you in becoming an entrepreneurial arist. And as for fees: I’m entrepreneurial too and ready to be paid in paintings or sculptures – that’s my business risk and incentive for success.
    Oh. by the way, let’s go back to Anish Kapoor for one moment. In 2006 he delivered another great sculpture, and which nicely fits one of my themes: Here’s Anish Kapoor’s S curve

    The origins of the S Curve (about Everett Rogers’ Diffusion of Innovations)

    50 years ago today (2012), Everett Rogers published his book Diffusion of Innovations in which he described the lifecycle of innovations. His theory of innovation has become a standard model in the marketing world, and has been further developed from an explanatory model to a marketing tool, aimed at influencing speed of take up and penetration of innovations.

    Rogers’ is still worth reading, as I found out recently and it contains some nice surprises. Given the current use of the S curve, one would expect this book to be about the introduction and adoption of consumer products. Actually, most cases in the book are about the spread of agricultural innovations in communities of farmers, in the USA and other countries. The measurements from extensive fieldwork are plotted in many graphs and reveal the well-known sigmoid pattern. There’s no case in the book about consumer products, but marketeers got the picture and were eager to apply it. Their favorite picture is the derivative function, showing the number of adopters over time. It’s adopter categorization lead to the notions of innovators, early adopters, early and late majority and laggards, the first target group “segmentation” in the history of marketing. Continue reading