Tag: future

Definitions During a Crisis – COVID-19 series

Posted on by Steve Sammartino

(12 min read – long, but worth it) 

Historian and author Yuval Harari says that if something doesn’t feel, then it isn’t real.  While an economy can grow or decline – it’s an abstract concept. Many of the parts that make an economy are real – like people – but much of it is just aggregated concepts for which measurements are possible.

Weirdly, it seems many governments (Australia and the USA come to mind) are more concerned with abstract concepts than real people’s needs. So with that in mind, I’ve decided to bust out some truth bombs and break down what is really happening during this crisis.

The Economy – The word economics can be traced back to mean household management. Of course, if a household has no resources, it can’t participate in the wider economy. This would also flow through to business to business transactions, because the only reason they exist is to facilitate the production of goods and services for other households as well. Ultimately it all starts and ends with the household. How quickly our federal government forgot that if we want the economy to survive, we need to go back to the original meaning of economics and help out households. If that means replacing incomes temporarily, then the government should do this. The best thing our government could do right now is think bottom up, not top down. If people have resources (money), everything else will be OK in the long run. If the government helps businesses first, then they’ve forgotten why businesses actually exist. Go to the source. In times where efficiency of resource allocation is desperately needed, cutting out the middle man is a damn good place to start.

Capitalism – We don’t live in a capitalist economy, but a mixed economy where we have a financial competition backed up with social protections. That’s what our taxes and governments are for. Right now the pendulum needs to swing very far to the side of socialism. We’ve always had publicly provided, healthcare, pensions, disability and unemployment benefits. What we need right now is a strategy or short term government policy that could save lives. Any murmur of dissent from so-called ‘capitalists’ needs to be pushed back hard by all of us.

The Corporation – A corporation is a legal entity set up to reduce the personal risk of people who own it. If corporations are designed to protect people, it might be time ignore the structure and think of the people they are made up of. Save the people and the corporations will be fine. If this sounds ridiculously simple, it actually is.

Yield – Our economy for too long has been based on capital growth instead of yield. We’re about to transition from growth to yield. People and companies have been obsessed with acquiring things in the hope they’ll be worth more tomorrow, simply because there is demand for it rather than the fruit it bears. Growth should be a function of expected future yield, but that seems to have gotten lost somewhere along the line. It’s about to make a serious comeback in the sharemarket, real estate and pretty much anything we invest in. The market will start to ask what’s the yield and base their decisions on that. This is a good thing.

Trickle Down Economics – This is the flawed idea that if we reduce taxes and costs for businesses and the wealthy, it will stimulate business investment in the short term and benefit society at large in the long term. The reality is that it’s called trickle down, because the 99% end up with only a trickle. The clue was in the name, and yet those who divined this strategy managed to sell it to the world. We are about to see it doesn’t work and the truth is that our economy is bottom up – it always has been. Governments around the world will realise very quickly that unless you replace lost incomes at the household level (like Denmark are doing), we are headed for a deep and long depression.

Bailouts – If Australia or any other country bails out an industry, it should be a buyout instead. Bailouts are a hoax where the stockholder get to profit in good times and make tax payers take the downside. It’s a case of private profit and public losses. If a firm is important enough for a government to bailout, then it should be nationalised or at a minimum, the government should take equity positions to the equivalent value of their market cap at the time of the bailout. These equity positions should take the form of preferred convertible stock.

Here’s an example: Qantas has performed share buybacks (when a company buys its own stock to take it off the market and boost the share price, benefiting existing shareholders and often bonus-incentivised executives) of over a billion dollars in the last 2 years. If they hadn’t done the buybacks, they would have a war chest of over a billion dollars in their balance sheet for moments like these. In an industry plagued with Black Swan events like this every decade or so, it would have been a more prudent management strategy. I bet Allan Joyce won’t give back any of his $20 million in non salary benefits he received last financial year.

Unemployment Statistics – For a long time the ‘underemployed’ (people who want more work than they currently have) have not been regarded as unemployed. I’ve even read predictions as recently as this week claiming unemployment might even get to 11-15%. These unemployment predictions are laughable. Get ready for 30-50% unemployment. In times of great change we need to get our heads out of the spreadsheet and into the real world. Most things happen on the street before they can be measured empirically in any meaningful way. Maybe the people coming up with these numbers should go and ask a broad sample of 100 people if they are currently working… then they’d get some real numbers.

De-globalisation – We can also expected a re-consideration of running global supply chains. The true national risk of every country’s supply chain will be exposed during this crisis. You better hope like hell your country is good at making food, generating energy and has a good healthcare system. Post COVID-19, we will see many countries taking steps to secure supply chains on vital industries. We are learning really quickly the difference between essential and optional. Sorry, Team Kardashian.

Economic Shock – It’s important we understand that this isn’t an economic disaster or shock, but a natural disaster. The consequences of which are different. If we thwart the virus quickly, there’s a big chance we will come out of this economic trough more quickly than we would if it were an economic-driven recession. If it lasts more than a couple of seasons it will shift the culture, change how we spend and invest in a longitudinal way. Human culture in every corner of the world is a function of their natural environment. In a highly populated city-based connected economy, this could change social and financial behaviour for a very long time.

Natural Monopolies & Utilities – Countries that still control their utilities and natural monopolies will handle COVID-19 a lot better than those with largely privatised utilities. If Australia still owned and controlled its water, energy and telecoms, it could simply pause all bills for x period of time. What could be a massive financial relief for households is now not possible.

The good news is that many countries will rightly reconsider the re-nationalisation of vital infrastructure. This would not only allow flexibility in times like these, but allow build-outs of leading edge technology as most of these assets are going through a technological upheaval. It would also provide secure forms of employment and training which matches market needs.  I’ve written about this extensively before.

Power of Big Tech – Ironically, the companies benefiting the most from this crisis are those who need it least: Big Tech businesses like Google, Facebook, Amazon, Microsoft and Apple. They already too powerful will only become even more powerful after this event. Just yesterday, the Australian Government announced a new app specifically to communicate with constituents about the crisis. It’s a nice idea – but even our Government had to abide by the rules of Big Tech and rely on Apple and Google to make it available on their app store. They also created a WhatsApp tool to extend their reach, relying on Facebook. Post COVID-19, many countries will realise they do not have and desperately need digital sovereignty

Discrimination –  This disease doesn’t discriminate. From princes to Prime Ministers, no one is immune. We’ve also realised the difference between essential services and optional indulgences. Health, housing, food, energy and humble logistics. It’s worth sparing a moment of thought for people working in supermarkets and hospitals, and putting themselves at risk for us.

It’s moments like this we realise that we are all in this together.

Privacy as a Luxury

Posted on by Steve Sammartino

Here’s some light entertainment to end the week. Our latest Future Sandwich Now-Soon-Later episode. In this episode we take a look at in big tech’s move to infiltrate our homes (ironically when we are spending more time in them)  Smart speakers, sorry, microphones, smart homes and surveillance capitalism. You’ll learn about the one thing we all used to have, that we’ll have to pay for to get back.

I’d love it if you could subscribe to our Future Sandwich Youtube channel, make a comment (feel free to disagree) and share with someone who has let Big Tech spy on them inside their house! There’s a free Google Nest Mini for the best comment. Oh, before I forget, this was recorded pre Social-Distancing.

I hope you’re all keeping safe, healthy and minimising contact. Just like business, if we do more than we’re asked, we might get a better result, and out of this situation sooner.

Steve.

P.S. Due to many requests I’m currently writing up how I see the world changing forever post Corona – which I’ll share here at a later date. 

How to make the Gig Economy ‘Work’

Posted on by Steve Sammartino

Over 100 million workers around the world are hoping even harder than their peers that they don’t come down with coronavirus COVID-19. Who are they? Those working in the gig economy, where benefits like sick leave are something they can’t rely on. The worst part? If they do get sick, they might just have to keep on working, which puts everyone else’s health at risk. It’s about time we got innovative to improve the gig economy for everyone.

Let’s be clear on one thing – the gig economy isn’t going away. It is not a short-term aberration, but a long-term shift. Currently, the number of gig workers is growing more than 30% every year.

In the past, the reason we became employees was because the place of work was centralised – all the tools to do our jobs resided only in factories and offices. It was also difficult to find, train, ratify the skills and organise the work of people who weren’t under a company’s direct control. But the trajectory of technology today tells us that this is no longer the case. The traditional employee is no longer required and lower paid gig work is just the start of a freelance future for all. Sure, companies will still need to get things done, but they don’t need employees. The latest ABS data shows that 30% of adults participated in freelance work this month. Additionally, it is predicted that by 2027 there will be more independent workers than PAYG wage earners in Australia.

At the dawn of the industrial revolution, the major tools of production (think factory), became centralised. Before this, the large majority of labour was undertaken independently, either on the farm or as a craftsman. When we industrialised, people came to the cities en masse to partake in higher-paid work for large firms. To remove the friction of finding and training every week, workers became employees of the firm. This quasi-permanent engagement between the parties extended into office work as we entered the information phase of industrialised economies.

Fast forward to today and the friction of labour is being removed rapidly. The technology in our homes is as good as any office. Most forms of information work can be done anywhere, with NASA-powered computers in our pockets. Disparate labour can be organised around the world too, in real time. In the future, I believe that most people won’t be employees, but ‘digital craftspeople’ who hire their time to one, or many organisations. I’ll go as far to predict that within 50 years we’ll see global multi-billion dollar corporations with exactly zero employees. All their work will be performed by independent contractors – Uber on steroids. This will happen not only because it’s logistically possible, but far more profitable.

Problem: The current situation for gig workers is sub-optimal. Workers fought hard over decades for access to safe workplaces and fair remuneration, but these rights are now being eviscerated. Benefits like annual leave, sick leave, training, OH&S standards and superannuation have conveniently become the responsibility of the worker. This is a problem when we have economic shocks like the coronavirus. We don’t need to ban gig work, or make gig workers employees. We can be smarter than that. All we need is structural innovation and we only need look as far as superannuation to find an answer.

Gig Worker 2.0

It wasn’t until 1983 that employee superannuation contributions started with The Accord and became mandatory in Australia in 1992. Prior to that, superannuation was a benefit bestowed on only the fortunate few and workers with strong unions. What we need now is a new kind of gig worker benefit scheme akin to superannuation. This benefit scheme would provide a form of security for gig economy workers. For example, a simple percentage loading on labour fees could go into a fund to create employee-style benefits (annual leave, sick leave, superannuation etc) for gig workers, paid for by the firms hiring gig labour. Gig workers currently forego these benefits many of us take for granted. This way, gig workers can maintain their living standards and dignity while they are making their economic contribution . Governments the world over would do well to implement such a policy.

While the numbers would need to be verified, I would estimate the gig worker loading should be around 20%. While that might sound quite high, studies show that employee on-costs are anywhere up to 50% of their wages. If firms employing flexible labour say it won’t work – then I’d argue they don’t have a sustainable business model in the first instance.

The fund would need be in the worker’s name and ported wherever they perform gig labour. If we managed to pass such a law, our economy would be better placed to cope with the long-term shift to independent labour gigs, remain flexible, but also be able to cope with periodic shocks to the economy. It could also invent an entire industry for Australia – one whose model could actually become an export.

A New Industry

At some point in the near future, a smart government somewhere will implement such a policy (which is better than forcing gig workers to become employees), and lead the world in inventing an entirely new industry. In Australia alone, our Superannuation industry (which was spawned by the union movement) is now a $2.7 trillion industry and the 4th largest pension fund asset holder in the world. We’ve led the way. If we are first to set up this kind of a policy structure, we could export the financial management model of gig support the world over. However, this takes foresight, courage and political will.

Unions & The Gig Economy

Union memberships are in steep decline – it’s now less than 15% of workforce. In 1960, it was 60%.  It is difficult to see a future for unions. unless they reinvent themselves and pivot to offering non-union workers something they need in the future. Fighting for gig economy workers is the perfect innovation staring the union movement in the face. Unions should start focusing on representing new types of labour, who have powerful forces (like Big Tech) exploiting them. Enter, gig workers. Fuelling the erosion of the union member base is a myopic view of the type of labour that fits their model. They have an opportunity right now to go beyond traditional blue collar work, start a movement and become relevant again. Instead of using standover tactics to create profit share and inordinate wage rises, they can focus on what gave them relevance over 100 years ago, and that is fighting for fairness and a sustainable workforce.

If there’s anything we need in our economy, it is regulatory innovation to match the rapidly changing technology driven labour market. Yes – governments need to innovate too.

I spoke about this topic on ABC radio yesterday – click here to listen.

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Robot Love

Posted on by Steve Sammartino

We don’t just have a relationship with technology, we use technology to find relationships. Newspapers, video dating, website matching services and apps – and to the most direct of all – Tinder.

The reason Tinder works is simple. It replicates human behaviour in the real world. The moment someone walks into a night club they look around at the faces of people and say to themselves, Yes, No, No ,Yes, No, No, No, No Yes, Yes. And the people they are looking at are doing the same thing back at them – assuming of course they are both looking to meet someone. But in the actual nightclub there is that awkward discovery process of trying to work out if the other party feels the same way. Which then becomes the business model of the nightclub – Sell people drinks for that few hours of the discovery process.

One of the core functions of the alcoholic drinks was to make people look better, and feel more confident. Well, technology has managed to do replace this as well – let’s just say that instagram filters are the new beer goggles!

Technology has a way of replicating what we do in the real world, and in doing so, it creates competition in business which are non traditional, even hard to align. Beer volumes may decline due digital photo filters. Insights like this are very difficult to report in a corporate market share update.

In the not too distant future – things could get even weirder. People developing serious relationships with humanoid robots – Robots which look, feel and act, just like humans. The vote 50 years from now might make gay marriage seem so minor as we vote on whether or not humans and robots can get married!

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Happy Valentines Day.

The Decade in Tech

Posted on by Steve Sammartino

It’s pretty easy to forget how much a new technology changes our lives once it’s adopted. Sure, some new technologies are like shooting stars, but some change everything forever. So, for posterity’s sake, I’ve laid out a list of new technologies that changed how we do things, and maybe even the direction of our species. Enjoy!

2010

What happened: Google leaves China + Uber launches in App Store

Why it mattered: Google leaving China was the start of a New Cold War. China pushed hard to create clones of Western online services and even made better ones – see WeChat. This time the Cold War isn’t an arms race, but a race for quantum and data supremacy. The weird part is that USA and China both surveil their citizens, though the Chinese government isn’t making a secret of tracking their citizens, while the USA is pretending it’s about security when clearly it’s not.

Uber hitting the App Store was about much more than putting taxis on notice for terrible service. It was the start of the immediacy economy – anything and everything on demand, delivered to wherever we happen to be. The start of a massive GPS-driven logistics and mobility revolution.

2011

What happened: Twitch is launched + Steve Jobs dies

Why it mattered: For the uninitiated, Twitch is an online streaming service to watch people play video games. If it sounds ridiculous to you, then just remember that in many cultures we gather in giant stadiums to watch teams of adult humans dressed in co-ordinated attire kick dead animal skins through white sticks (football). It really was the start of the meta-economy where online activities are starting to gather layers and blur with the ‘real world’.

The death of Steve Jobs cemented his legacy as a quasi-Jesus figure for tech fans the world over. The problem was this created a dangerous idolatry of any innovation big tech companies launched at us. From this, the negative externalities have been ignored for far too long – including the massive issues we are now facing with Big Tech’s monopoly powers on par with nation states.

2012

What happened: Facebook buys Instagram for $US 1 billion + Tinder launches

Why it mattered: An open and fair internet took a massive hit when Facebook bought Instagram. This was the start of a serious economic consolidation of power while regulators were asleep at the wheel. The fact that we have a single ‘media’ organisation – and yes they are a media company – with massive influence over 2.4 billion constituents should make all of us lose sleep at night.

We’ve been finding mates online and in personal columns for decades, but Tinder normalised digital as a preamble to the physical meetup process. Meeting online went from weird to just plain ordinary.

2013

What happened: Edward Snowden’s NSA revelations + Facebook goes public with IPO.

Why it mattered: Snowden’s revelations of a mass surveillance programme targeting US citizens was the first time the wider population saw the downside of digital. While most people still don’t care, or at least act like they don’t, it did signal that privacy and security will eventually become the workplace health and safety of the modern era. If we are fortunate, it might spawn a new industry to protect our civil rights, while society and lawmakers catch up with the the reality of the risks.

Facebook goes public. Interestingly, its founder and CEO Mark Zuckerberg sends a letter to shareholders claiming that its mission of connecting (controlling) the world is more important than profit – but he fails to mention in said letter that he can never be removed from office or voted out. Just think of this: Mark Zuckerberg is in control of more people than anyone, ever, in history. To date, its market capitalisation has now increased fourfold since the IPO. Welcome to the Zuckerberg Dynasty.

2014

What happened: Facebook buys WhatsApp + Amazon Echo is launched

Why it mattered: It’s strange to me that Facebook was able to make an acquisition valued at $US 16 billion and still not capture the attention of antitrust regulation. They also said it was ‘impossible’ to integrate FB and WhatsApp services and data. Then, just like magic, they were able to do it a couple of years later, lolz… see 2012 above.

The launch of the voice services with Amazon Echo will be remembered in the future as the time when we truly started to communicate with AI. This was that moment. This will be when it got real.

2015

What happened: Google driverless vehicle hits the road + SpaceX lands first rocket

Why it mattered: When Google (now Waymo) put its driverless car out for all to see on a real road, industrialists sat up and took notice. We realised that cars were very quickly becoming rolling computers, that the digital world now shaped the physical world too. That was the moment that every business knew it too was now in the technology business.

The Space Race was once the exclusive domain of Big Gov. After a few decades of neglect, it has been miraculously revived as a private industry. If anything – this should signify the era of the bodacious billionaire where they have as much (or more?) power than elected governments.

2016

What happened: Donald Trump elected President + Theranos implodes

Why it mattered: In my view Trump is an inevitable symptom of crazy times and a radical pace of change. But it was the moment the wider world realised that news isn’t news anymore. We all live in echo chambers of existing belief systems and our minds can be hacked by the power of algorithms.

When blood diagnosis health startup Theranos was exposed as a scam – everyone started to understand that not all unicorns would live up to their hype, valuations or even their product promises. It was time to be very aware that in the real physical world beyond photo sharing apps, it’s very important that products actually work.

2017

What happened: Cambridge Analytica scandal + Bitcoin bubble

Why it mattered: The Cambridge Analytica scandal particularly annoyed me because it wasn’t the Cambridge Analytica scandal – it was actually a Facebook scandal. I don’t know how The Zuck pulled it off, but it was a stunning exercise showcasing the dark arts of blame deflection.

The bursting of the Bitcoin and crypto bubble was one we had to have. I liken it to the dot-com bubble of 1999. Cryptocurrency too will come back and change our lives, and this new financial system might change the world even more than the internet has.

Here’s the history of Bitcoin price:

2018

What happened: GDPR + Deep Fakes arrive

Why it mattered: The EU’s General Data Protection Regulation (GDPR) put surveillance capitalism on notice. While the opening gambit was small and probably affected the competitors of Big Tech more than those it was aimed at, it was the start of a movement to give power back to the people.

The first flurry of deepfakes hit the world and blew minds. But just wait until they are free and anyone can do it. It might just spell the end of audio visual truth. A few years from now, we’ll be asking people if they were actually there to prove it happened. This could put a massive schism into the entire web and anything news-related.

2019

What happened: Antitrust actions commence on Big Tech + Greta Thunberg named Time Magazine’s Person of the Year

Why it mattered: Antitrust actions taking place this year are a classic turning of the tide and the realisation we are in the middle of a gilded technopoly. The next decade will be one of regulation versus innovation – with the former taking precedence over the latter. It won’t be about stopping or slowing down technology, rather about civilising it so we can have progress for all humanity, not just the fortunate few.

Greta showed the world than even a child can command attention on issues vital for humanity. It’s amazing what can be said when words are not guided by vested interests. Here’s what I know for sure: we have all the technology we need today to have a low carbon emission economy. The kicker is that such a shift to a new energy model is probably the only way to maintain the economic growth the grownups seem to love so much.

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For me this is an era where the development of technology won’t slow – but its implementation might and it will certainly be more considered, competitive and wide-reaching for whom it benefits. I can’t wait to push deeper into the next decade and help build a future we all deserve.

Trickery as a Business Model – Rental Cars

Posted on by Steve Sammartino

Customer service systems have improved so much in the past 20 years that we take for granted how arduous some things used to be. I was reminded yesterday when I had to pick up a hire car that not every industry has embraced the possible. Why? To maximise profit while the barriers to entry are still high. It made me wonder if one car rental brand is called Hertz on purpose!

The picture above is the line I was waiting in. It inspired this spur of the moment LinkedIn post which really seems to really have struck a nerve. Here’s what I posted below:

Dear Rental Car Industry: this is a queue from today. Most brands have it at the airport today & often. The problem isn’t a busy day, it’s that your rental process is stuck in 1989. We waited nearly an hour! I don’t buy for 1 second that this process couldn’t be all digital and all automated. A simple text with my car rego and bay number is all we need. Condition reports can be pics on drive out, insurance, copies of driver licenses and credit card details all can and should be automated. Let’s call it ‘sub-optimal’ – I could redesign this in a day & fix this in 2 weeks.

As I write this the post has had 73,157 views, had 978 reactions and 196 comments.

The comments on the LinkedIn post provided some deep insight into industry disruption, technology and CX. But more importantly, it was filled with many customer centric fixes, and startups in the process of doing so.

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The story doesn’t end there.

Once I finally got to the check-in counter, I was then asked if I wanted insurance, and that the excess for not choosing insurance was $5000. Seriously? I felt extorted. The risk of not taking the insurance seemed far too high not to proceed. The crazy bit is that it added more than $200 to my final rental price for a few days, which almost doubled what I had paid for when I booked it online. What is clear is that this isn’t offered at the time of booking online because it exposes the ‘real price’ during the booking process, when switching to an alternative is easier. It also seems as if the ‘analogue’ pick-up process is designed on purpose to perform this upsell to customers. (Oh, and I’m being generous with the term upsell).  The car I ended up getting wasn’t the one I ordered, either. It was in the same size class, and I am aware that the offer is ‘Car XYZ or similar’ when booked. This presents a major problem. I ordered our specific car on purpose because I know it fits our luggage and my surfboard. The one I got didn’t. I’m struggling to understand why any car rental firm wouldn’t have the exact same model of each car in each size category. Surely that wouldn’t not only reduce purchase price via negotiating power, but reduce also operating costs. Not to mention, customers would actually know what they are getting. Maybe it’s just a little bit too much commonsense here from the Sammatron? Other times I’ve even been ‘upgraded’ to larger cars, which isn’t really an upgrade in cities overseas where I want a small car on purpose because the streets are small and I’m unfamiliar with the roads. It does seem that this industry is entirely built on serving itself and its existing infrastructure instead of its customers.

The problem as I see it isn’t really the prices. It’s the process, lack of respect and lack of dignity they afford their customers. It’s the fact that it could provide a much better experience.

While some premium memberships and other firms and startups in this space offer a superior digital check-in process, it seems that a poor experience is most common. To the credit of Avis, their AP Commercial Director did reach out to discuss the issue and improvement plans. (I’ll update you on that in due course.)

Why do they get away with it?

As far as I can tell – this business has far more barriers to entry than taxis did. Firstly, a fleet of cars is required, and retail and parking space in airports comes at a super premium. This alone would keep out most players wanting to disrupt the space. Also, given that any alternative couldn’t be a pure SaaS play, most Venture Capitalists would shy away from funding a new disruptor. But buckle your seat belt, some big players are coming.

What’s coming soon

New competitors are about to arrive and it is not Uber, Lift, Didi, Hola, GoGet or new car rental startups. It’s the OEM Car Manufacturers themselves. As soon as autonomy arrives, and it is coming quicker than you think, they won’t just sell cars, they’ll be renting them too. By the trip, by the hour, the day and the month via subscriptions. Lucky for them, consumers have already been trained through ride sharing companies’ hard work.

Once cars can drive themselves, the car manufacturers can avoid the need for a retail space and a car park in an airport and simply summon a car to the kerbside of the airport to rent out. In fact, car manufacturers can do all sorts of interesting things like provide free rental to existing new car purchasers and sell cars via monthly subscriptions which are ‘location agnostic’. This is all with a massive pricing advantage given they won’t have to buy cars from third parties like rental incumbents do.

The Lesson? 

The lesson is simple, really. It’s very easy to assume that as soon as better technology becomes available, large corporations will adopt it. The opposite is most often the case. They tend to lag behind the potential of technology and customer expectations as long as possible. Especially when the barriers to entry are high. It’s also a good reminder that opportunities to improve an industry are everywhere and not dependent on new tech. They are mostly about lazy incumbents taking advantage of a glitch as long as they possibly can.

Zero External Energy Buildings

Posted on by Steve Sammartino

Our buildings are a great reflection of where we’re at technologically. Once a revolution is truly mainstream, we see it in our homes. In the past century, we’e added electricity, indoor plumbing, white goods, entertainment devices, and even computational power and AI. But we are about to do something so different, it might require new language to describe it.

Zero External Energy (ZEE) Buildings

In the near future, buildings will be rated not just on their efficiency, but on their energy generation-to-usage ratio. But this will be for the entire building and essentially, an input/output measure. As the cost of going off-grid with solar panels and battery storage plummets, fossil fuels’ days are numbered. Once most houses are powered by renewables, a new measurement will occur. We’ll want to know how much external energy the building uses. We will enter the world of the ZEE building.

A Zero External Energy building is one that generates all the energy it needs to sustain itself entirely – 24 hours a day, 365 days a year. Most will be via solar, but some buildings will employ wind, geothermal and other emerging renewables like artificial photosynthesis. Expect to hear someone say, ‘My new house is fully ZEE’ within 10 years. In this world, walls and surfaces of a building will have a purpose beyond keeping the weather out. Every inch of the roof will capture energy and so will our windows. An amazing Australian company called ClearVue already produces solar panel windows as seen below:

ZEE buildings will:

  • not have an energy-based carbon footprint
  • have enough energy to charge electric cars
  • eventually produce more energy than they need.

So, what do we do with all that extra energy? We’ll trade it.

Enter the Energy Internet

No, we won’t trade this energy with power companies. Instead, we’ll trade it with each other across an energy network, as the grid becomes decentralised, looking and behaving a lot like the internet. It’s often referred to as the Energy Internet. Just like we produce content that we trade with each other over the communications internet, we’ll trade the excess energy our buildings produce with other services, markets or places who need it when we have an excess. But in the long run, the exponential improvement in energy capture will lead to buildings using this energy to grow food.

A New Kind of Calorie Count

Many spaces in buildings will be deployed to grow food with new types of urban agriculture. These will be managed by AI and robotics so we don’t need to attend to them with human labour. Green buildings will have a yield which isn’t a return on investment from tenants – but food grown on walls, top floors and even in car parks.

As cars become autonomous, many car parking spaces will be converted into urban agriculture – even car spaces which are underground. Remember, we don’t necessarily need sun – we just need light, energy and water which we will have an abundance of. Once this happens we’ll also start valuing buildings based on how many calories they produce each year. “I live in an 180 million calorie house – it can feed a family of four.”

While this might sound weird – compare how weird it would have been to own a refrigerator just 200 years ago, let alone an energy rating for it. For this and ideas like it to happen, we have to start thinking sideways. We have to look for ways to apply technology it was not designed for. When we start cross-fertilising tech ideas like this (and yes, that pun was totally intended), then we can take giant leaps towards solving our biggest ecological challenges.