Survival of the Fittest

I am sure you can remember a time in your life where external forces cornered you into a tough predicament. Last month I read a book called “Only the Paranoid Survive” by former CEO of Intel, Andrew Grove. Grove coins the term “strategic inflection point” in his book, which is essentially a crisis point that every business will face somewhere along the line. No matter how successful the company, as industries change and innovate, there will be a moment where business’s can stick to their day 1 plans, or take the risk of pivoting the company’s direction toward the potential future of the industry. For Intel in the 1980s, this was a shift from memory chips to microprocessors in the computer industry. While this concept is applicable to all industries, I want to dive deeper into how this can be affecting tech in the march toward a future with blockchain and artificial intelligence.

The IPhone Becomes the New “Standard”

Growing up I could have never imagined anything better than my Dad’s flip phone. At the time, the only thing a cell phone was able to do is text, call, and maybe take pictures, until Apple released the IPhone. We can look at this as a strategic inflection point in the phone industry. Apple created a profound change in the way companies produce phones, introducing a touch screen concept that includes apps, a calendar, the internet, and countless other features. Grove mentions in his book that when the industry begins to shift, “the practitioners of the old art may have trouble.” And he was exactly right. Apple was the first-mover in these uncharted territories which helped them immensely and created difficulties for other companies to keep up. While older companies rode the struggle bus, the IPhone created a whole new job market for app development. Sometimes you gotta love capitalism. This inflection point hit all competitors in the phone industry, and we see today, many companies never adapted. In the grand scheme of things, this is only a small sector of tech. What would happen if there was a new technology that presented all of tech and even parts of finance with a strategic inflection point?

Is Blockchain a Crisis Point for Companies?

Depending on the company, blockchain may very well be a strategic inflection point. Blockchain is a public ledger of transactions, mostly made by cryptocurrencies, that is maintained across different computers using a peer-to-peer network. Since 2009, when Satoshi Nakamoto launched Bitcoin, we see what some call the advent of “Web 3”. Web 2 is essentially the internet. We associate Web 2 with companies like Amazon, Google, Microsoft, and Apple. Web 3 is defined by blockchain, cryptocurrenies, and NFTs. Some companies or projects include Bitcoin, Ethereum, Bored Ape Yacht Club, and Polygon. Keep in mind, as Web 3 develops, artificial intelligence and augmented reality are also developing at a rapid rate. Just like the Dot Com boom in the late 1990s, blockchain technology is misunderstood by most people given it’s nuance. So how do these big Web 2 companies transition toward web 3? Let’s look at Apple and Google.

Will Apple thrive in Web 3?

Although Apple led the charge in the bundle of big tech companies that pioneered the last technological revolution, that may not be the case in the future. Apple makes a fantastic phone and an even better laptop, but can they integrate AI, blockchain, and crypto into these products? Just last week Coinbase CEO, Brian Armstrong, stated that Apple demanded IOS apps like Coinbase Wallet to share 30 percent of gas fees generated from NFT transfers. Without boring you with extreme detail, I will just outright say that this is not possible. Gas fees are payed out to stakers and miners in a decentralized manner, not to Apple through their centralized in-app purchase system. When Grove mentioned the old timers having the most trouble adapting, this is what he was talking about. I am sure Apple has hosted many meetings, debating whether they should focus on using this technology, but their lack of understanding on a basic topic in Web 3, leads me to believe they are simply uneducated.

Can Google Compete with ChatGPT?

For those of you who do not know, ChatGPT stands for chat generative pre-trained transformer and it is a chatbot created by OpenAI. If you are asking yourself what the hell I just said, I’ll break it down. It is kind of like a search engine that uses artificial intelligence to generate a human like conversation, therefore you are able to ask it questions or tell it a story. The results are astonishing. I asked it to come up with a good name for a crypto-related newsletter, this is what it said:

This is just a simple question. If you look at examples of people interacting with it on Twitter, it is apparent that it’s complexity stretches far beyond what I wrote. I have seen multiple developers ask it to debug their code, and with ease, it responded intricately explaining how to solve the problem and had model code to follow in order to reach that solution. The alarming part of this is the response from Google when asked the same coding question. Google gave a vague explanation that basically redirected you to another link, assuming that you had 30 spare minutes to read through the novel of code they recommended. Personally, I see this becoming a major crisis point for Google. I have already favored ChatGPT over Google for many things in the last few weeks. I would assume Google is using an AI technology of their own, however if they are not able to adapt to potentially the new wave of search engines/chat bots, they may fall behind.

Only the Paranoid Survive

The title of this book is a good place to end. It is clear that crisis points for business’s are unexpected and hard to deal with. That is why the book follows the notion that business’s must remain “paranoid” in order to be ready to go in ever-changing circumstances. It is no mystery that Web 3 and Artificial Intelligence opens the gates to the next technological revolution, leaving us with the final question. Who will survive?

Book/Podcast Recommendation of the Week:

Only the Paranoid Survive by Andrew Grove

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