The Third Wave: Big Tech, Healthcare, and the Internet of Everything

“Change is the process by which the future invades our lives” — Alvin Toffler

Death and survival are natural phenomena when it comes to evolution.

Not much is different in technology.

Last month we saw something interesting at the annual JP Morgan Healthcare Conference; big tech.

Google, Amazon Web Services, and other tech companies had a presence at the conference.

We’ve officially entered a period where we will see tech companies enter heavily regulated public sectors.

Sectors such as healthcare, education, food, energy, and transportation.

The most interesting is healthcare.

We’ve are seeing the beginning of the Third Wave.

The First Transformation

Alvin Toffler was the first to write about a coming global transformation.

He described three waves of changes:

The First Wave of humanity was the settled agricultural society that was dominant for thousands of years.

The Second Wave was the post-Industrial Revolution world, where mass production and distribution transformed how people lived.

The Third Wave was the information age. Simply, an electronic global village, where people could access an endless array of services and information, participate in an interactive world and build a community based not on geography but common interests.

He predicted the world as we know it today.

Decades later, a catalyst helped society take a liberated step into an electrifying future.

That catalyst was America Online.

If you took Google, Spotify, Facebook, and Instagram to combine into one colossal tech giant, you have AOL.

AOL co-founder Steve Case was inspired by Toffler’s vision and wanted to be part of building the third wave.

He wrote a new version of the book to describe the waves of technology since the birth of computers as well as forecast our generation’s “Third Wave”.

The Third Wave is taking form and barreling towards the beachhead of healthcare.

The First Wave

The First Wave of the internet was all about building the infrastructure and foundation for an online world. Here were the major players:

Cisco Systems, Sprint, HP, Sun Microsystems, Microsoft, Apple, IBM, AOL.

These companies developed the hardware, software, and networks people needed to connect to the internet and to one another.

This was the birth of the information superhighway and to Case, these companies were the on-ramps.

This group of online pioneers was up against it all.

They had to haggle to reduce the cost of getting people connected.

They had to beg PC manufacturers to consider making their computers with built-in modems.

They had to work with each other to form partnerships and influence policies.

They had to fight for everything.

What was sacrificed gave the next generation of innovators a rich foundation to build on top of.

The Second Wave

The Second Wave of the Internet began at the death of the Y2K scare and birth of the 2000s.

As in nature, this also saw the first Internet extinction event, the dot-com bubble burst.

The death of many dot-com startups and investments was in sacrifice to something greater.

Those that survived adapted and evolved enough to prime the next evolution of Internet innovations that would add enormous momentum to the Second Wave.

The Second Wave was about catching the momentum generated from the First Wave.

Unlike its predecessor, the Second Wave didn’t require much fighting to establish policy, seeking partnerships, and developing perseverance for long sales cycles and adoption.

There was plenty of investment around and not as much competition at the moment.

Plus, you could literally just create a minimally viable product to launch into the market and see if it gets traction (or in our case catches a wave).

Of course, that also meant a rush of many that tried to ride the Second Wave.

Photo courtesy of @cameronstow

The companies that emerged added efficiency to the internet and helped to take the average person online.

Here are a few of those players that helped bring the internet into our everyday lives:

Google made it easier to explore the infinite volume of information online.

Amazon and eBay took the local corner store online.

This is also when social networking was conceived.

With search engines organizing information, social networks helped society organize itself.

This was accelerated with the introduction of smartphones such as Apple’s iPhone and Google’s Android.

Mobile added a deep, dynamic element that gave the second wave such power that nobody ever anticipated.

Software as a service took off, and features of larger social networks were conceived such as Twitter and Instagram.

Remember when Twitter first launched and people said: “who cares about what Im doing/thinking at this moment?”

Apparently, a lot of people.

Today, Twitter has a market cap of $22 billion.

Other companies emerged such as Waze, Groupon, Netflix, and more.

These companies all shared two interesting characteristics:

  1. Infinitely scalable
  2. Infinitely replicable

This was taking the Industrial Age of mass manufactured goods and introduced the concept of “infinite”.

The Second Wave is now starting to birth something new. With the scale of the internet and accessibility, the technological age has permeated all areas of life.

Since the Internet makes everything infinitely replicable at scale and infinitely scalable, our smart devices have become portals for the internet to reach through into our physical world.

Our homes, workplaces, vehicles, have all become technological doorways into the real world.

It is now a ubiquitous force that is integrating into everything we do.

That door can never be closed. You might even say that the force of the Second Wave ripped that door out of its hinges.

And this is when the Third Wave arrives.

The Third Wave

Photo courtesy of @robertbye

The Third Wave is an era when the Internet has infinitely expanded to be so vast that it no longer belongs to Internet companies.

The garden becomes nature when it grows out of its walled confines.

What was once controlled and walled off now engulfs the very thing that confined it.

It was the nature-like world of the Internet confined within the walled garden that is the computer.

Now, it has expanded outside of its hardware and is approaching ubiquity.

In my eyes, Ray Kurzweil’s Singularity is slowly becoming a reality, where these superintelligent creations abruptly trigger runaway technological growth, resulting in unfathomable changes to human civilization.

This is an era that demands products to require the Internet even if the internet doesn’t define them.

To exist makes it necessary to have some interaction with the new technological ecosystem.

Saying that something is “Internet-enabled” is as crazy as saying something is “Electricity-enabled”.

We have left the age of “Internet of Things” to the time of “Internet of Everything”.

The Beachhead of Healthcare

Healthcare is begging for disruption.

The healthcare system makes up 18% of our economy’s expenditures and with a $3 trillion market, Big Tech wants to be part of it.

For instance, Amazon recently entered the pharmaceutical distribution sector with its acquisition of PillPack. Meanwhile, Google has increased its stake in health insurance startup Oscar Health to 10% with its recent $375M investment.

Due to its ability for infinite scale and replicability, the Second Wave transferred an unstoppable amount of momentum to the Third Wave.

Healthcare’s beachhead is in the path of the Third Wave’s barrelling force.

Despite the increasing momentum from technology waves, most current healthcare companies are rooted in the past.

Healthcare is barely applying technological innovation that already exists, let alone developing new forms.

The culture of medicine stems from one that is skeptical, conservative, and steadfast. It isn’t surprising to me that this culture also influenced the industry.

That is all set to change due to the Third Wave.

Removing the Barrier

After years of watching from the shore, patient’s have potentially become the most important players in healthcare’s disruption story.

As patients have surfed the technological Third Wave in other industries they now begin to remove the barriers that have kept tech out of healthcare’s beachhead.

One reason is the evolution of healthcare toward predictive health.

The Predictive Health Institute of Emory University and Georgia Tech states that the category looks to cause a fundamental shift from “medically-oriented disease care to a proactive system focused on health and wellness.

This approach aims to move the medical system from the traditional focus on diagnosing and treating the disease to a focus on recognizing, maintaining and sustainably optimizing health.

After years of contending with limited options for healthcare, consumers now have choices of when, where, how, and from whom they receive care from.

A growing variety of delivery models, including telemedicine, home health, concierge care, and online self-help have contributed to this.

Consumers have been conditioned through the retail and food industries to have a variety of choices. The internet has turned into a portal where these expectations have begun to appear in other industries such as transportation (Uber, Lyft) and education (online universities and courses).

As this occurs more in healthcare, they will also gain access to treatments that are specifically tailored to their genetic makeup and health history.

The “Quantified Self” with wearables, mobile tracking, and other smart devices has exposed the healthcare beachhead and allowed for barriers to be removed.

At first it was patients but now providers are beginning to allow more of the Third Wave to wash up onto healthcare’s shore.

Some reports have shown that up to 88% of physicians want patients to monitor their health parameters at home.

While healthcare has a long way to go before it can be considered consistently customer-centric, these new channels offer consumers qualities they look for from other service providers, including convenience, attentiveness, timeliness, value and price transparency.

A key to disrupting healthcare is part of the framework of Big Tech’s customer-centric business model.

That framework is using technology to address issues around access, value, and cost.

Doctors will also benefit from improvements in IT. Bringing together the disparate pieces of information can vastly lower costs and improve quality by keeping a patient’s various providers informed — technology that has been available for years, but never fully embraced.

Surviving and Thriving in a Third Wave World

This age becomes a bridge for entrepreneurs to disrupt heavily regulated public sectors; healthcare, agriculture, transportation, and education.

Steve Case points to the playbook of first wave companies that third wave entrepreneurs must utilize.

Like the first wave, the barriers to entry are enormous, skepticism is high, and the new ecosystem is still young. This made partnerships a necessity in order to survive and thrive at scale.

Symbiotic relationships in nature exist when the ecosystem is too harsh for any organism to survive on its own.

3 things that we will see in this violent step into the Internet of Everything:

1. The internet will soon permeate everything on earth.

2. To thrive in a Third Wave world you must embrace disruption.

3. Success will rely on cooperation with Second Wave incumbents.

This last wave will be shaped by the Internet of Things, in which connection is unlimited.

A key for survival is embracing big, sudden changes, and even disrupting yourself to make it in a Third Wave world.

This is what Nassim Nicholas Taleeb spoke about in “Antifragile” over half a decade ago.

The winners of tomorrow must partner with the winners of yesterday.

This is Darwinism at its finest.

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