I realised this recently when I listened to Joi Ito's talk at Le Web 3. This was probably the best talk I have ever heard. I have embedded a video of it below and I highly, highly recommend you watch it. If it does not affect your way of thinking then watch it again :P.
Joi talks about trends in multiplayer gaming (MMO), as well as gaps in the market where he feels innovation could happen. Mainly between gaps in innovation between traditional media, the web and gaming technology. Its very interesting.
That got me thinking.
Firstly my thoughts: Startups are generally most successful when they are innovating something at the edge of a trend. So for example, trying to do a startup in car technology right now would be very hard. You might have something innovative to do there but most of the easy innovations are already taken and you would need lots of money to make and market something significantly better than what exists. Compare this to a 100 years ago ( I don't know anything about car history :) ), a 100 years ago it was possible for an enthusiast to really understand cars and push the technology of the age and even make a very successful company out of it. Even then I am sure it would have taken a lot of money and infrastructure to start a car business, but the cost of starting up a website is much smaller, and the only thing holding one back is a team, creativity and time.
I see innovation on the web like thousands of little ants attacking every single aspect of the web sugar hive. Some get through and make it big, some die in the fight, some make it big and then die from obesity, but generally its all so young that its still there for the taking.
There are of course trends happening outside the web that lead to some interesting opportunities. Take for example the trend in the UK for healthier, higher quality groceries. This lead to the rapid rise of Innocent fruit smoothies, which probably at most other times in UK history would have been a complete flop.
So coming back to the web, since I know slightly more about that. Some other interesting trends.
- Virtual Goods. I love these. If you think about it we are all very familiar with virtual goods, music is a virtual good and so are movies. They are packaged up with materials that cost money but essentially we are used to buying virtual goods. So it should not be that surprising that people are actually willing to pay people to buy a powerful sword in a game or to send virtual gifts to people. But having said that I still find it amazing and equally amazing how much money is being made here.
People spend over $1.5 billion on virtual items every year. Pets, coins, avatars, and bling (from tc)That to me is just astounding, and so out of my world. In some ways I feel that all things with zero marginal costs tend towards becoming free and ad-supported, but maybe I am wrong.
- Mobile. Here is something that for some reason has never really interested me. I think its because the experience is not fulfilling enough compared to the Internet. But it should be fairly obvious that a lot of innovation is happening on the mobile web. There are a lot of mobile web users in the world, with many people in Africa and Asia only experiencing the Internet on there mobile phones. That's pretty crazy.
- China in general. Enough said. Interesting trends. Most Internet users than all of the US shortly (or maybe its already happened).
I am sure there are a lot of other trends. But hopefully I have conveyed to some extent the value of watching your trends. And you should watch this video if you haven't yet ;-)